What is the formula for calculating the Pearce Bespoke renewal fee if it exceeds the minimum?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
ion with any such audit are payable upon demand by Franchisee prior to the expiration of the then existing term, including any audit costs, transportation, lodging, meals, and any other expenses incurred.
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- Franchisee has paid a Renewal Fee equal to the greater of (i) Five Thousand Dollars ($5,00
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, a franchisee can renew their franchise agreement for two additional five-year terms if they meet certain conditions. One of these conditions involves paying a renewal fee.
The renewal fee is calculated as the greater of two amounts: $5,000 or 25% of the then-current initial franchise fee. This means that if 25% of the initial franchise fee at the time of renewal is more than $5,000, the franchisee will have to pay the higher amount as the renewal fee. For example, if the initial franchise fee is $25,000 at the time of renewal, then 25% of that fee would be $6,250, which would be the renewal fee since it is greater than the minimum $5,000.
It is important to note that the renewal fee must be paid at least 30 days before the expiration of the current franchise term. Additionally, franchisees must meet other conditions to be eligible for renewal, such as complying with the franchise agreement, meeting brand standards, and modernizing equipment. Failing to meet these conditions could result in the inability to renew the Pearce Bespoke franchise.