What is the Pearce Bespoke franchisee's obligation regarding repairing or replacing damaged Operating Assets?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
ning additional Businesses in your Development Area, you must: (i) possess sufficient financial and organizational capacity to develop, open, operate, and manage each additional Mobile Franchise in our reasonable judgment; (ii) be in full compliance with all brand requirements at any existing Businesses you operate; and (iii) be in compliance with any Franchise Agreement or any other agreement entered into with us.
- 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).
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 FDD, if the equipment or vehicles ("Operating Assets") used in a Pearce Bespoke Mobile Franchise are damaged or destroyed due to causes beyond the franchisee's control, making them unusable, the franchisee must promptly notify Pearce Bespoke of the event. The franchisee is then obligated to diligently repair or replace the Operating Assets to resume business operations as quickly as possible.
For the purposes of the agreement, a Mobile Franchise that is closed due to such an event is still considered "in operation" for up to 30 days following the event. However, if the Mobile Franchise remains closed for more than 30 days after the damage or destruction, or if it closes for any other reason not approved by Pearce Bespoke in writing, Pearce Bespoke may exercise its remedies as outlined in Section 6.2 of the agreement.
Pearce Bespoke will not pursue those remedies if the Operating Assets are completely destroyed or irreparable, provided that the franchisee arranges with Pearce Bespoke or its designated supplier within 30 days to obtain new Operating Assets and reopens the Mobile Franchise in the protected territory within 90 days of the destruction event. This clause protects the franchisee from penalties as long as they take swift action to restore their business after an unforeseen event, but it also sets a firm deadline for resuming operations.