What is the franchisee acknowledging regarding the lack of reliance on any express guarantee from Pearce Bespoke?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee acknowledges that (i) the Territory was mutually agreed upon by Franchisor and Franchisee, (ii) prior to the Effective Date hereof, Franchisee conducted Franchisee's own due diligence with regard to potential customers and other matters relative to the operation of the Pearce Bespoke Franchise in the Territory, and (iii) Franchisor's agreement to the Territory is permission only, does not constitute a representation, promise, warranty, or guarantee, express or implied, by Franchisor that the Pearce Bespoke Franchise operated therein will be profitable or otherwise successful, and cannot, and does not, create any liability for Franchisor.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, the franchisee acknowledges several key points regarding their territory and the franchisor's guarantees. Specifically, the franchisee agrees that the territory was mutually decided upon with Pearce Bespoke, and that they (the franchisee) conducted their own due diligence regarding potential customers and operational matters within that territory before the agreement's effective date.
Furthermore, the franchisee acknowledges that Pearce Bespoke's agreement to the territory is simply permission to operate there. It does not constitute any representation, promise, warranty, or guarantee, whether express or implied, that the Pearce Bespoke franchise will be profitable or successful in that territory. This understanding also means that Pearce Bespoke cannot be held liable if the franchise does not perform as expected.
This acknowledgement is a standard practice in franchising, where the franchisee bears the responsibility for assessing the market potential and risks associated with their specific location. While Pearce Bespoke grants the franchise and provides a protected territory, the ultimate success of the business depends on the franchisee's efforts and local market conditions. This clause protects Pearce Bespoke from liability related to the franchisee's business performance.