If a Pearce Bespoke franchisee breaches the non-competition covenant, how is the noncompetition period extended?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise | Summary | |
|---|---|---|---|
| r. | Non-competition covenants after the franchise is terminated or expires | Sections 18(B) and (C) | No direct or indirect involvement in any resale mobile business involving the purchase and/or sale of custom clothing and accessories for 2 years within 10 miles of the Franchise or any other Pearce Bespoke Franchise. If the franchisee is in breach of this provision, the noncompetition period will be extended for a period of time equal to the time the franchisee operated a competing business, subject to state law. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 31–34)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the non-competition period is extended if a franchisee violates the non-competition covenant. Specifically, the standard two-year non-compete period can be extended.
The extension is calculated based on the duration the franchisee operated a competing business. For example, if a Pearce Bespoke franchisee improperly engaged with a competing business for six months, the non-competition period would be extended by six months, resulting in a total non-compete period of two years and six months.
This provision aims to protect Pearce Bespoke's interests by preventing franchisees from using the franchisor's confidential information and business model to unfairly compete after the franchise agreement terminates or expires. Prospective franchisees should carefully consider the implications of this non-competition clause and the potential for extension before entering into a franchise agreement.