When is the Pearce Bespoke Development Fee considered fully earned?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon execution of this Agreement, you must pay us a development fee in the amount specified in Exhibit A (the "Development Fee"), which is based on the initial franchise fee you must pay for each Mobile Franchise that you develop (the "Franchise Fee", which is also specified in Exhibit A). The Development Fee will be credited towards 100% of the Franchise Fee due under the Franchise Agreement for each Mobile Franchise that you develop pursuant to this Agreement, including the Initial Franchise Agreement. The Development Fee is fully earned by us when we and you sign this Agreement and is non-refundable, even if you do not comply with the Development Schedule.
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, the Development Fee is considered fully earned when both Pearce Bespoke and the franchisee sign the Area Development Agreement. The Development Fee amount is specified in Exhibit A of the agreement.
This fee is non-refundable, regardless of whether the franchisee adheres to the Development Schedule outlined in the agreement. However, the Development Fee will be credited towards 100% of the Franchise Fee due under the Franchise Agreement for each Mobile Franchise that the franchisee develops under the Area Development Agreement, including the Initial Franchise Agreement.
This means that once the Area Development Agreement is signed, Pearce Bespoke has earned the Development Fee and is under no obligation to return it, even if the franchisee fails to open the agreed-upon number of locations or otherwise does not fulfill the development schedule. Prospective franchisees should carefully consider the development schedule and their ability to meet it before signing the Area Development Agreement, as failure to comply does not entitle them to a refund of the Development Fee.