What is the consideration for the Pearce Bespoke franchise agreement?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
- A. We and you have entered into a certain Franchise Agreement dated the same date as this Agreement (the "Initial Franchise Agreement"), in which we have granted you the right to establish and operate one Pearce Bespoke franchised business within the protected territory set forth in the Initial Franchise Agreement (a "Mobile Franchise").
- B. We desire to grant to you the exclusive right to establish and operate a specified number of Businesses within a specified geographical area in accordance with a development schedule.
- C. If you are a corporation, limited liability company, partnership, or other entity (collectively, an "Entity"), all owners of a legal and/or beneficial interest in the Entity (the "Owners") are listed in Exhibit A to this Agreement.
- D. You desire to establish and operate additional Businesses upon the terms and conditions contained in our then-current standard franchise agreements (a "Franchise Agreement").
- NOW, THEREFORE, for and in consideration of the foregoing premises and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
1. Grant of Development Rights and Development Area
Subject to the terms and conditions of this Agreement, we grant to you the right, and you undertake the obligation, to establish and operate in the area designated in Exhibit A to this Agreement (the "Development Area") the number of Businesses specified in the development schedule in Exhibit A (the "Development Schedule"). This Agreement does not grant you any right to use the Marks (as defined in your Initial Franchise Agreement) or the System (as defined in your Initial Franchise Agreement). Rights to use the Marks and the System are granted only by the Franchise Agreements.
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 FDD, the Pearce Bespoke Area Development Agreement requires consideration from both the franchisor and the franchisee. The agreement states that it is made "for and in consideration of the foregoing premises and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged".
For Pearce Bespoke, the consideration is granting the franchisee the right, and obligating them, to establish and operate a specified number of businesses within a defined development area, according to a development schedule. This right is subject to the terms and conditions outlined in the agreement. However, the Area Development Agreement itself does not grant the franchisee the right to use Pearce Bespoke's marks or system; these rights are granted only through the individual Franchise Agreements that will govern each specific business location.
For the franchisee, the consideration is their commitment to fulfill the obligations outlined in the Area Development Agreement, including establishing and operating the agreed-upon number of Pearce Bespoke businesses within the designated area and adhering to the terms and conditions of both the Area Development Agreement and the individual Franchise Agreements. The "mutual covenants and agreements" suggest that both parties are exchanging promises and commitments that form the basis of the contractual relationship.