Is Pearce Bespoke Franchising, LLC a party to the franchise agreement?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
ee;
WHEREAS, you are or are about to be an employee, independent contractor, officer and/or director of a Pearce Bespoke Business that is independently owned and operated by us;
WHEREAS, in the course of your employment, independent contractor relationship and/or association with us, you may gain access to Confidential Information (defined below in this Agreement) and you understand that it is necessary to protect the Confidential Information and for the Confidential Information to remain confidential;
WHEREAS, our franchisor, Pearce Bespoke Franchising, LLC is not a party to this agreement and does not own or manage the Pearce Bespoke Business but is an intended third-party beneficiary of this Agreement;
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, Pearce Bespoke Franchising, LLC is not a party to the sample confidentiality agreement provided in Exhibit H. However, Pearce Bespoke Franchising, LLC is identified as an intended third-party beneficiary of the agreement. This means that while the franchisee and their employees or contractors are the direct parties to the confidentiality agreement, Pearce Bespoke Franchising, LLC retains certain rights and protections under that agreement.
Specifically, the confidentiality agreement excerpt states that a failure to comply with its terms will cause irreparable harm not only to the franchisee but also to Pearce Bespoke Franchising, LLC and other Pearce Bespoke franchisees. As a result, both the franchisee and Pearce Bespoke Franchising, LLC are entitled to injunctive relief in the event of a breach. This allows Pearce Bespoke Franchising, LLC to seek a court order to stop any violation of the confidentiality agreement, protecting their brand and confidential information.
This arrangement is not uncommon in franchising, as franchisors often want to ensure that their brand standards, trade secrets, and customer information are protected, even at the local franchisee level. By being named as a third-party beneficiary, Pearce Bespoke Franchising, LLC can directly enforce the confidentiality agreement without necessarily being a direct signatory to it. This provides an additional layer of security for the Pearce Bespoke system.
Prospective franchisees should carefully review Exhibit H and understand the implications of the confidentiality agreement, including Pearce Bespoke Franchising, LLC's role as a third-party beneficiary. It is also important to note that the document explicitly states, "THIS IS NOT AN EMPLOYMENT AGREEMENT." This clarifies that the agreement focuses solely on confidentiality and does not establish an employment relationship.