Development Agreement - Friendly Ice Cream Corp. and FriendCo Restaurants Inc.
DEVELOPMENT AGREEMENT
BETWEEN
FRIENDLY ICE CREAM CORPORATION
1855 Boston Road
Wilbraham, Massachusetts 01095
AND
FRIENDCO RESTAURANTS, INC.
1657 Crofton Boulevard
Crofton, Maryland 21114
DATED
July , 1997
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TABLE OF CONTENTS
Section Page
1. Schedule and Exclusivity ............ 2
2. Term.................................. 6
3. Fees.................................. 6
4. Application of Development Fee ....... 7
5. Application Procedures ............... 8
6. Restaurant Closing Procedure.......... 9
7. Assignment........................... 11
8. Non-Competition...................... 12
9. Default and Termination ............. 14
10. Agency and Indemnity................. 17
11. Notices.............................. 19
12. Miscellaneous ....................... 20
13. Acknowledgement of Risk.............. 21
EXHIBITS:
Exhibit A: Territory and Time Schedule.. A-1
Exhibit B: Omitted
Exhibit C: Franchise Agreement ......... C-1
Exhibit D: Commitment Agreement......... D-1
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DEVELOPMENT AGREEMENT
THIS AGREEMENT dated --------------, 19------, between FRIENDLY'S
RESTAURANTS FRANCHISE, INC., a Delaware corporation ("Friendly's"), and
FRIENDCO RESTAURANTS, INC., a Maryland corporation ("Developer").
WHEREAS, Friendly's owns, operates and licenses others to operate
distinctive high quality restaurants ("Friendly's Restaurants") serving the
public under the name Friendly's" (the "System"); and
WHEREAS, Friendly's desires to achieve market penetration in various
areas of the United States in order to more effectively expand, advertise
and market the System, and
WHEREAS, Friendly's has concluded that to further its goals, it desires
to grant to experienced and financially qualified persons or organizations
the opportunity for exclusive development of Friendly's Restaurants using
the System within limited territories for specified periods of time; and
WHEREAS, Developer desires to obtain the right to acquire sites within a
specific territory during a specified period of time on which to construct
Friendly's Restaurants using the System, to submit to Friendly's
applications for franchise agreements to operate Friendly's Restaurants on
such sites, and upon the approval of each such application, to
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enter into a franchise agreement with Friendly's to operate a Friendly's
Restaurant using the System upon such sites; and
WHEREAS, Developer represents that it has the organizational, operational
and financial strength, experience and resources necessary to carry out the
multiple development of Friendly's Restaurants within the Territory, as
defined below, in the specified time set forth below.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and pursuant to the terms and conditions of this Agreement, the parties
hereby agree as follows:
1. SCHEDULE AND EXCLUSIVITY.
A. Developer agrees to construct, equip and open seventy-four (74)
Friendly's Restaurants using the System within the time schedule and
territory (the "Territory") set forth on Exhibit A attached hereto and made a
part hereof, and to maintain the operation of an additional thirty-four (34)
Friendly's Restaurants pursuant to a franchise agreement, subject to
Paragraph 1.G., infra.
B. Developer agrees that time is of the essence under this Agreement,
and agrees to comply strictly with each and every element of the time
schedule set forth on Exhibit A. Developer further agrees that Exhibit A
sets forth the minimum number of Friendly's Restaurants to be constructed,
that Developer will be required to have
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the minimum number under contract and to demonstrate the number under
contract in order to qualify for any cure period for any default, and that
it is the mutual goal of Friendly's and Developer that Developer construct,
equip and open a greater number in an extended time period (the "Target
Number") of Friendly's Restaurants as described on Exhibit A, but the
failure to open the Target Number shall not be a default hereunder.
C. For the purposes of this Agreement, a restaurant will be considered
open or under construction in such calendar year as the construction permit
is obtained and the building footings are poured. The Developer will have
six (6) months for the date construction commences to have the restaurant
open for business in order for the restaurant to be included in the minimum
number required to be open or under construction in any given year.
D. During the term of this Agreement, Friendly's shall not operate, or
license or franchise others to operate restaurants using the System within
the Territory except as provided in this Agreement; provided however, that
if the Target Number has not been achieved, Friendly's may operate, or
license others to operate Friendly's Restaurants within the Territory and,
provided further, that during the term of this Agreement only, Friendly's
shall not own, license or franchise any Friendly's Restaurant within the
Trade Area (as defined in Paragraph 8) of any Friendly's Restaurant operated
by Developer.
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E. Developer agrees that this Agreement does not grant it the right to
use the System at any location, nor does it grant Developer any rights with
respect to the System or to use any of the trademarks or trade secrets of
Friendly's, such rights being exclusively governed by a Franchise Agreement
for each Friendly's Restaurant opened hereunder.
F. Each Friendly's Restaurant as and when constructed, equipped and
opened, and the relationship of Developer and Friendly's with respect to
each such restaurant, shall be governed by the terms of an individual
Franchise Agreement on the form of such agreement attached hereto as Exhibit
C which will be granted to Developer by Friendly's in the good faith
exercise of its sole discretion; provided, however, that upon the earlier of
the expiration of this Agreement, the completion the Target number or the
elapse of ten (10) years from December 31, 1997, Developer shall thereafter
use the then current form of Franchise Agreement.
G. Developer agrees that all Friendly's Restaurants set forth on
Exhibit A must be open and operating during established business hours at
all times (excepting casualty or condemnation or act of God) on and after
their scheduled opening date and in the event any such restaurant(s) is not
at all times open and operating during established business hours, it will
constitute a default hereunder, except for such restaurant closings as are
permitted in accordance with Paragraph 6 hereof.
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H. Upon final expiration or termination of this Agreement for any
reason, Developer's territorial rights and rights to construct, equip, open
and operate Friendly's Restaurants shall terminate and expire and Developer's
rights to use the System shall be limited to those Friendly's Restaurants
operating pursuant to effective Franchise Agreements which Friendly's and
Developer may have entered into prior to the final expiration or termination
of this Agreement.
I. Developer shall have a right of first refusal on the operation of
any Friendly's Restaurant located in the Territory in an Institutional Site
(such as a government office, theme park, hospital, airport, university or
college, military base or similar setting serving essentially a captive
audience or customer base). The sole exceptions to the exclusivity of
territory granted hereunder shall be the fourteen (14) managed Restaurants,
the two (2) restaurants operated by F.I.C.C. (which shall be closed and
de-identified no later than four (4) months after the Effective Date and the
Maryland Science Center restaurant. Any Friendly's Restaurant in the
Territory which is not managed or operated by Developer may only be managed
and operated by employees of Friendly Ice Cream Corporation during the term
of this Agreement. Such exclusivity shall not limit the rights reserved by
Friendly's or F.I.C.C. under Paragraph 1.C. of the Franchise Agreement.
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2. TERM.
This Agreement shall commence upon the date first written above and shall
terminate upon the earlier of December 31, 2007, or the date of Developer's
execution of a Termination Agreement following the opening of the
seventy-fourth (74th) Friendly's Restaurant required to be constructed,
equipped, opened and operating pursuant to this Agreement, unless terminated
earlier as provided for herein. The feasibility of further development in
the Territory shall be assessed by Friendly's and Developer after the
completion of the 74th restaurant and again after the completion of the
100th restaurant, and thereafter every five (5) years. An agreement to
continue the development of additional restaurants hereunder shall operate
to extend the Term of this Agreement. In no event shall the completion of
the 74th restaurant cause this Agreement to terminate prior to December 31,
2003.
3. FEES.
In consideration of the rights granted Developer, Developer shall pay to
Friendly's the sum of Nine Hundred Thirty Thousand and 00/100 Dollars
($930,000.00) (the "Development Fee") all of which is non-refundable except
as provided under Paragraph 9G and all or part of which has either heretofore
been paid or is tendered herewith.
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4. APPLICATION OF DEVELOPMENT FEE.
A. Developer agrees that Friendly's is not obligated in any event,
including the termination or expiration of this Agreement, to return to
Developer all or any part of the Development Fee, except as provided in
Paragraph 9G of this Agreement.
B. Developer has no rights in the Development Fee except as are
specifically set out in this Agreement.
C. Friendly's agrees that, at such time as Developer and Friendly's
execute a Commitment Agreement for the issuance of a Franchise Agreement
("Commitment Agreement") for any of the Friendly's Restaurants to be
constructed, equipped and opened hereunder, Friendly's shall apply the
Development Fee in an amount equal to one half ( ) of the initial franchise
fee required to be paid in connection with each such application and
subsequent grant of a Franchise Agreement. The Franchise Fee shall be Thirty
Thousand Dollars ($30,000.00) for the first two (2) restaurants constructed
hereunder and Twenty-Five Thousand Dollars ($25,000.00) for each additional
restaurant set forth in Exhibit A, and thereafter shall be an amount equal to
the then-current initial franchise fee.
D. In the event the Development Fee has been applied such that there
is a balance owed against any initial fee(s) which may become due, Developer
shall pay
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any balance of such initial fee due to Friendly's with Developer's
application for a Franchise Agreement.
5. APPLICATION PROCEDURES.
A. Developer acknowledges and agrees that franchise agreements are
granted by Friendly's only after submission and approval of a formal
application on Friendly's then-current application form supplying all
information requested thereon and paying all required fees. Developer
further understands that a Commitment Agreement is first executed and
delivered following approval of such application and that if the terms and
conditions of the Commitment Agreement are complied with, a Franchise
Agreement granting a franchise to operate a Friendly's Restaurant will be
executed and delivered. Developer acknowledges and agrees that the Commitment
Agreement and the Franchise Agreement will be the forms of such agreements
as are attached hereto as Exhibits C and D for the restaurants developed in
accordance with Exhibit A .
B. Developer shall comply in all respects with Friendly's franchise
application policies and procedures when Developer applies for a Franchise
Agreement in order to fulfill its obligations under this Agreement.
Developer understands that it should obtain a Commitment Agreement before
making any unconditional binding commitments to third parties, and
understands and agrees
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that any activities undertaken in reliance on this Agreement prior to such
time are at Developer's own risk and expense.
C. Developer acknowledges and agrees that Friendly's may choose to
grant or deny applications for franchise agreements; however, Friendly's
will exercise good faith in exercising its discretion.
D. Developer shall be solely responsible for locating appropriate sites
for the construction of Friendly's Restaurants as contemplated hereunder and
taking all other actions necessary to finance, build, and construct such
restaurants. Developer understands and agrees that all proposed sites are
subject to Friendly's prior approval, not to be unreasonably withheld.
6. RESTAURANT CLOSING PROCEDURE.
A. Developer may discontinue operations at any Friendly's Restaurant
opened or maintained pursuant to this Development Agreement (other than
through condemnation or casualty loss) only in accordance with the procedure
set forth in this Section 6. Developer shall notify Friendly's that the
restaurant to be discontinued does not produce a profit at a restaurant
operating level, and shall afford Friendly's not less than thirty (30) days
to audit the operations of such restaurant, should Friendly's choose to do
so. Evidence of a restaurant's failure to produce a profit shall be
established through six (6) quarters of consecutive losses totaling
Seventy-Five
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Thousand Dollars ($75,000.00) or if an aggregate loss of Seventy-Five
Thousand Dollars ($75,000.00) is achieved in such shorter period when
measured on the basis of restaurant operating income. Thereafter, Developer
may proceed to discontinue operations at the restaurant so long as
de-identification of the restaurant occurs within fifteen (15) days of the
cessation of restaurant operations.
B. Developer shall replace any closed restaurant with (and shall
transfer the Franchise Agreement for such closed restaurant) to a newly
constructed or remodeled restaurant within eighteen (18) months of the
cessation of restaurant operations, if the replacement restaurant does not
have a drive-thru window, or within twenty-four (24) months if the
replacement restaurant does have a drive-thru window (collectively, such
period shall be considered the "Replacement Period").
C. Developer shall be entitled to a moratorium on royalties and
marketing fees for the Replacement Period for a total of four (4) closed
restaurants; however, for each additional closed restaurant, Developer shall
continue to pay the average monthly royalty and marketing fee for such
restaurant as was paid during the last twelve (12) months of operation until
each such additional restaurant is replaced pursuant to the terms of this
Paragraph 6, and the Franchise Agreement for such closed restaurant is
transferred to the replacement restaurant.
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D. For each closed
Restaurant to be replaced, Developer shall pay a Site Replacement Fee to
Friendly's to cover Friendly's costs of reviewing and approving the
proposed replacement site, such Fee to be in the amount of the lesser of
Friendly's actual costs or Two Thousand Five Hundred Dollars ($2,500.00).
7. ASSIGNMENT.
A. Friendly's may assign all or any part of its rights or obligations
hereunder to any person or entity, provided, however, that such person or
entity has no right or authority, at the time of such assignment, to license
others to operate Friendly's Restaurants within the Territory, unless and
until this Agreement has expired or terminated.
B. The rights and obligations of Developer hereunder are not assignable
without the prior written consent of Friendly's which may be withheld in
Friendly's sole discretion. For the purposes of this clause, an assignment
includes an assignment, sale, or other transfer, directly or indirectly of
any interest in Developer, but shall not include a transfer by merger with
the corporate parent or other affiliate of Developer, provided that the net
worth of the affiliate successor entity is the same or greater than the net
worth of the Developer and its corporate parent as of the Effective Date.
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C. Developer shall not assign, sell or transfer any interest in
Developer during the term hereof without the prior written consent of
Friendly's, not to be unreasonably withheld.
D. Any purported assignment contrary to the foregoing provisions shall
be void and of no force and effect and shall constitute a default hereunder.
8. NON-COMPETITION.
Developer acknowledges and agrees that Friendly's has invested a
substantial amount of time and money in developing the System and the
confidential information associated therewith (the "Confidential
Information") and that Friendly's would be unable to protect its System, the
Confidential Information and trade secrets against unauthorized use or
disclosure and would be unable to encourage a free exchange of ideas and
information among Friendly's and its licensees if prospective licensees or
licensees were permitted to hold interests in or perform services for any
competing business and that the following restrictions are reasonably
required in order to protect Friendly's information, marketing strategies,
operating policies and other elements of the System from unauthorized
appropriation and to ensure that Developer is using its best efforts in
employing its financial and management resources effectively to meet and
exceed the minimum and target development schedule set forth in this
Agreement. Therefore, Developer agrees that, during the term of this
Agreement, neither Developer nor any of its corporate parent, subsidiaries
or their affiliates will have any direct or indirect legal or beneficial
interest or perform
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services in any business which owns, operates, licenses, franchises or
develops any restaurant concept which both (i) has sit down, table service,
and (ii) is a mid-scale priced, family style restaurant, coffee shop or ice
cream/frozen yogurt shoppe (as defined by CREST operators list as of June 1,
1997) including but not limited to Denny's Shoney's Big Boy, Country
Kitchen, Bob Evans, Cracker Barrel, IHOP, Village Inn, Waffle House, Dairy
Queen, Swensen's, Carvel, Baskin Robbins, TCBY or similar. Notwithstanding
the above, a restaurant concept which is a mid-scale priced family style
restaurant will be deemed competitive if frozen deserts comprise 5% or more
of the sales mix as measured on any six (6) month basis. Developer further
agrees that for a period of two (2) years after the termination or expiration
of this Agreement, Developer and all of such persons will be subject to the
same restriction on competing activities (i) within the Territory and (ii)
within the trade area (as reasonably determined by Friendly's) of any
Friendly's Restaurant currently operated by Friendly's or any licensee, but
in no event within a radius of three (3) miles from any such restaurant.
Developer further acknowledges that this paragraph confers no exclusivity on
Developer with respect to Developer's further operation of any Restaurant
within the Territory after the expiration or termination of this Agreement.
The restrictions of this section shall not be applicable to the
Friendly's Restaurants operated under franchise agreements between Developer
and Friendly's, to the ownership of shares of a class of securities listed on
a stock exchange or traded on the over-the-counter market that represent five
percent (5%) or less of the numbers of shares of that class of
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securities issued and outstanding, or to any restaurants franchised by
Wendy's International and operated by the corporate parent or any affiliate
of Developer.
9. DEFAULT AND TERMINATION.
A. This Agreement shall terminate without further notice at the time
and date set forth in Paragraph 2 hereof, unless extended or earlier
terminated as set forth hereinbelow.
B. This Agreement shall automatically terminate without notice in the
event Developer becomes insolvent or is unable to pay its debts as they may
mature or make an assignment for the benefit of creditors or an admission of
inability to pay obligations as they become due or file a voluntary petition
in bankruptcy or any pleading seeking any reorganization, liquidation,
dissolution or composition or other settlement with creditors under any law,
or admitting or failing to contest the material allegations of any such
pleading filed against Developer, or its adjudicated a bankrupt or insolvent
or a receiver or other custodian is appointed for a substantial part of
Developer's assets or the assets of any Friendly's Restaurant owned by
Developer or a final judgment remains unsatisfied or of record for ninety
(90) days or longer (unless supersedeas bond is filed), or if execution is
levied against any substantial part of Developer's assets is made, or suit to
foreclose any lien or mortgage against Developer or any Friendly's Restaurant
owned by Developer is instituted and is not dismissed within ninety (90)
days, or if a substantial part of Developer's real or
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personal property is sold after levy of judgment thereupon by any sheriff,
marshal or constable, or the claims of Developer's creditors are abated or
subject to a moratorium under any law;
C. In the event Developer materially fails to comply with any of the
terms and conditions of this Agreement (excepting only by reason of force
majeure, such as, but not limited to: civil strife or commotion, labor
strike, lockout or Acts of God) or the terms and conditions of any Commitment
Agreement, Franchise Agreement orother agreement between Friendly's and
Developer, it shall constitute a default of this Agreement, and if Developer
fails to cure such default(s) within one hundred eighty (180) days in the
first year of this Agreement, or sixty (60) days in the next four (4)
subsequent years, of Friendly's giving written notice of said default(s) to
Developer or the cure period provided in such other agreement, Friendly's, in
its sole and absolute discretion, and in addition to any other rights and
remedies it may have at law or in equity, may terminate this Agreement and
any Commitment Agreements in force at the time of the default without further
notice.
D. In the event of termination of this Agreement, Friendly's shall
retain all of the Development Fee, as a liquidated damage except as provided
for in Subparagraph G herein, and any unaccrued portion of the Development
Fee shall be retained by Friendly's without the necessity of notice thereof.
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E. A default under this Agreement shall not constitute a default under
any Franchise Agreement between Friendly's and Developer. However, the
failure of Developer to complete the minimum development required hereunder
shall grant to Friendly's the option to purchase the assets and rights
relating to the original thirty-four (34) restaurants sold to Developer by
Friendly Ice Cream Corporation at the same multiple of cash flow (i.e. 5.3
times EBITDA on a trailing twelve (12) month basis) as in the original
transaction by Friendly Ice Cream Corporation and Developer, pursuant to the
Purchase and Sale Agreement dated July 10, 1997.
Upon the exercise of the repurchase option, the leases and subleases
between Friendly Ice Cream Corporation and Developer, as well as any
guarantee of such leases or subleases by DavCo Restaurants, Inc. will
terminate, excepting only such leases or subleases which Developer shall have
assigned or sublet to a third party (the "Remaining Leases").
The assignment or sublease between Developer and any third party on the
Remaining Leases shall attorn to Friendly Ice Cream Corporation, and any
guarantee of the Remaining Leases by DavCo Restaurants, Inc. shall remain in
full force and effect throughout the remainder of the base term (and renewals
at the sole discretion of such third party) of such assignment or sublease.
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F. Upon final expiration or termination of this Agreement for any
reason, Developer's territorial rights and rights to construct, equip, open
and operate Friendly's Restaurants using the System shall automatically
terminate and expire and Developer's rights to use the System shall be
limited to those Friendly's Restaurants pursuant to effective Franchise
Agreements which Friendly's and Developer may have executed and delivered
prior to such expiration or termination.
G. Friendly's failure to comply with the terms and conditions of this
Agreement shall constitute a default hereunder. If Friendly's fails to cure
such default(s) within thirty (30) days of its receipt of written notice
thereof, this Agreementshall terminate and any portion of the Development
Fee not applied pursuant to Paragraph 4 hereunder shall be refunded to
Developer.
10. AGENCY AND INDEMNITY.
A. Developer and Friendly's agree that this Agreement does not create
any fiduciary relationship between them and nothing in this Agreement is
intended to make either party an agent, legal representative, joint venturer,
partner, employee or servant of the other for any purpose whatsoever. Each
party to this Agreement is an independent contractor and shall hold itself
out to the public as an independent contractor.
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B. Developer shall not make any contract, agreement, warranty or
representation in the name of Friendly's, and Friendly's assumes no
liability for, nor shall it be deemed liable by reason of, any action or
omission of Developer and its conduct of business pursuant to this Agreement
or any claim or action arising therefrom.
C. Developer shall indemnify and hold Friendly's harmless from and
promptly reimburse it for any and all claims, demands, taxes or penalties,
actions and payment of money (including, but not limited to, fines, damages
legal fees and expenses) by reason of any or all claims, demands, taxes, or
penalties arising directly or indirectly from, as a result of, or in
connection with Developer's actions oromissions hereunder or those of its
agents or employees, including those of its contractors and subcontractors.
At the election of Friendly's, Developer will also defend Friendly's against
same at Developer's expense. In any event, and regardless of Developer's
payment of legal fees, Friendly's will have the right, through counsel of its
choice, to control any claim, demand, action or matter to the extent it
could directly or indirectly affect Friendly's financially, and all such
expenses shall be subject to indemnity hereunder. Developer's obligations
under this paragraph shall survive the termination or expiration of this
Agreement.
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D. Except as provided above, Friendly's and Developer shall indemnify,
defend and hold each other harmless from claims, demands and causes of
action asserted against the indemnitee by any person for personal injury or
death or for loss of or damage to property and resulting from the
indemnitor's active or passive negligence or willful misconduct. Where such
injury, death, loss or damage is the result of joint active or passive
negligence or willful misconduct, the duty of indemnification shall be in
proportion to the allocable share of the joint active or passive negligence
or willful misconduct.
11. NOTICES.
All notices required under this Agreement shall be in writing and shall
be personally delivered, sent by facsimile or overnight courier or mailed by
United States Mail, Return Receipt Requested, to the respective parties at
the following addresses unless and until a different address has been
designated by written notice to the other party:
Friendly's: FRIENDLY'S RESTAURANTS FRANCHISE, INC.
1855 Boston Road
Wilbraham, Massachusetts 01095
Attention: General Counsel
Developer: FRIENDCO RESTAURANTS, INC.
1657 Crofton Boulevard
Crofton, Maryland 21114
Attention: President
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Notices sent (i) by personal delivery or facsimile shall be effective
when received; (ii) by mail on the third business day after mailing; and
(iii) by overnight courier on the second business day after delivery to the
courier.
12. MISCELLANEOUS.
A. No failure or delay of Friendly's or Developer to exercise any
rights reserved to it in this Agreement or to insist upon compliance by
either party of any obligation or condition in this Agreement, and no custom
or practice of the parties at variance with the terms hereof, shall
constitute a waiver of either party's right to demand strict compliance with
the terms of this Agreement. Waiver by either party of any particular
default will not affect or impair the rights of Friendly's or Developer with
respect to any subsequent default of the same or a different nature.
B. This Agreement is solely for the benefit of the parties hereto and
their permitted assignees and is not intended to and shall not be construed
to benefit any other person, firm or entity.
C. The title headings of the respective paragraphs of this Agreement
are for reference purposes only and shall not effect the meaning or
interpretation of this Agreement in any way.
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D. This Agreement and any rights or liabilities arising from or in
connection with this Agreement shall be governed by the laws of the State of
Delaware. Any action brought to enforce any provision of this Agreement
shall be brought and maintained only in a state or federal court of competent
jurisdiction in Wilmington, Delaware.
E. This is the entire agreement between the parties concerning the
development of Friendly's Restaurants within the Territory and any
modifications must be in writing and signed by both parties, or said
modifications will be void and of no force and effect.
F. If any term or provision of this Agreement or the application
thereof to any person or circumstances shall, to any extent, be invalid or
unenforceable, the remainder of this Agreement, or the application of such
term or provision to persons whose circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby.
13. ACKNOWLEDGEMENT OF RISK.
A. Developer acknowledges the success of the business ventures
contemplated by this Agreement involves substantial business risks and is
dependent upon the Developer's ability. Friendly's expressly disclaims the
making of, and Developer acknowledges that it has not received and is not
relying upon, any
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warranty or guarantee, express or implied, as to the potential volume,
profits, or success of the business venture contemplated by this Agreement.
B. Developer represents that it has independently investigated the
risks of the business venture contemplated by this Agreement and has read
the disclosure documents prepared by Friendly's in accordance with the state
and federal franchise laws and agrees that Friendly's has made no
representation that is not fully set forth therein or herein.
C. Developer acknowledges that it has not and agrees that it will not
rely upon any representations not contained herein or in the disclosure
documents prepared by Friendly's in accordance with state and federal
franchise laws.
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WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date and year first above written.
ATTEST: FRIENDLY'S RESTAURANTS
FRANCHISE, INC.
_____________________________ By: ____________________________
Print Name:
Its:
Date:
WITNESS: DEVELOPER
____________________________ By: ____________________________
Print Name:
Its:
Date:
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E X H I B I T A
to
DEVELOPMENT AGREEMENT
Dated: ---------------------- , 199
between
FRIENDLY'S RESTAURANTS FRANCHISE, INC.
and
TERRITORY:
States of Delaware, Maryland, the District of Columbia and following Virginia
counties: Alexandria, Arlington, Caroline, Clarke, Culpeper, Essex,
Fairfax, Fauquier, Frederick, King George, Lancaster, Loudoun, North
Umberland, Prince William, Rappahanock, Richmond, Shenandoah, Spotsylvania,
Stafford, Warren and Westmoreland.
The boundaries of the Territory defined above shall, throughout the term of
this Development Agreement, be those boundaries as they exist as of the date
hereof.
TIME SCHEDULE:
No later than (Date) Minimum number of new Target number of Friendly's
Friendly's Restaurants to be Restaurants to be opened or
opened or under construction under construction
(permits obtained, footings
poured - six (6) months to to
complete construction)
December 31, 1998 11
December 31, 1999 26
December 31, 2000 41
December 31, 2001 52
December 31, 2002 63
December 31, 2003 74
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December 31, 2004 81
December 31, 2005 88
December 31, 2006 94
December 31, 2007 100