Can Lees Famous Recipe unreasonably withhold consent for a franchisee to relocate their Restaurant?

According to Lees Famous Recipe's 2025 Franchise Disclosure Document, a franchisee may relocate their restaurant only with the franchisor's written consent, which Lees Famous Recipe will not unreasonably withhold. If Lees Famous Recipe permits the relocation, the franchisee must pay a relocation fee equal to 50% of the then-current Initial Franchise Fee. Additionally, the franchisee will need to build out the relocated restaurant to meet Lees Famous Recipe's current standards for new restaurants.

This policy provides some protection to the franchisee, as Lees Famous Recipe cannot arbitrarily deny a relocation request. However, the franchisee bears the financial burden of the relocation fee and the costs associated with building out the new location to Lees Famous Recipe's standards. The relocation fee, set at 50% of the initial franchise fee, could be a substantial expense, and the cost of construction to meet current standards could also be significant.

It is important for prospective franchisees to understand the conditions under which Lees Famous Recipe would consider a relocation request and what factors might lead to approval or denial. Franchisees should also inquire about the typical costs associated with relocation, including the relocation fee and build-out expenses, to assess the financial implications of potentially needing to move their restaurant in the future. This information can help franchisees make informed decisions about site selection and long-term business planning.