What is a Pearce Bespoke franchisee required to do immediately after a Destruction Event?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.2 Damaged Operating Assets. If the equipment and/or vehicles ("Operating Assets") used in the operation of any Mobile Franchise in your Development Schedule are destroyed or damaged by any cause beyond your control such that they may no longer continue to be utilized for the operation of a particular Business, you must immediately give us notice of such destruction or damage ("Destruction Event"). You must diligently work to repair and replace the Operating Assets of your Mobile Franchise as soon as possible to resume operation of your Business. If a Mobile Franchise is closed due to a Destruction Event, the Mobile Franchise will continue to be deemed "in operation" for the purpose of this Agreement for up to 30 days after the Destruction Event occurs. If a Mobile Franchise (i) is closed in a manner other than those described in this Section 3.2 or as otherwise agreed by us in writing or (ii) fails to reopen within 30 days after a Destruction Event, then we may exercise our rights under Section 6.2 (Our Remedies). In the event the Operating Assets are completely destroyed or otherwise incapable of being repaired following a Destruction Event, we will not exercise the remedies set forth under Section 6.2 provided, that (a) within the 30 days after the Destruction Event you have made arrangements with us or our designated supplier to obtain new Operating Assets for use in your Business; and (b) you are open and operating your Mobile Franchise in the protected territory within ninety (90) days of the Destruction Event.
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 FDD, a Pearce Bespoke franchisee operating a Mobile Franchise must immediately notify the franchisor of any destruction or damage to their equipment and/or vehicles that prevents them from operating the business. This event is referred to as a "Destruction Event."
Following this notification, the franchisee is required to diligently work to repair or replace the damaged Operating Assets as quickly as possible to resume business operations. The franchise will be considered "in operation" for up to 30 days after the Destruction Event, giving the franchisee a limited time to restore their business.
If the Mobile Franchise remains closed for more than 30 days due to the Destruction Event, Pearce Bespoke has the right to exercise its remedies, potentially leading to termination of the franchise agreement. However, Pearce Bespoke will not exercise these remedies if the franchisee arranges for new Operating Assets within 30 days of the Destruction Event and reopens the Mobile Franchise within 90 days of the Destruction Event.
This clause highlights the importance of insurance coverage for the franchisee's equipment and vehicles. It also places a significant responsibility on the franchisee to act quickly and decisively to mitigate the impact of any unforeseen events that could disrupt their business operations. Franchisees should clarify with Pearce Bespoke what constitutes acceptable arrangements for new Operating Assets and what documentation is required to demonstrate compliance with these requirements.