To whom is the Liquidated Damages fee payable for Pearce Bespoke?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
all costs including transportation, lodging, |
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| meals, and wages, if applicable. | |||
| Annual Certification Training | $199 per session | Yearly | All active clothiers will be required to attend our annual certification training (the "Annual Certification Training"), which may be held online or in person at a location that we designate. We anticipate the cost of recertification will be approximately $199 and will be held monthly. |
| Approval of Supplier Fee | $500 plus cost of examination and approval of a supplier requested by Franchisee. | Prior to examination | You will purchase only such types, models or brands of items, furniture, equipment, signs, and supplies that We approve for Pearce Bespoke as meeting its specifications and standards, including specifications and standards for quality, design, warranties, appearance, function, and performance. |
| Operational Standards | $250 to $1,000 per occurrence | As incurred | Payable to us. |
| Violation Fee | |||
| Liquidated Damages – Violation of Confidentiality or Non-Competition Covenants | $100,000, plus our attorneys' fees | Per Occurrence | Payable to us if you violate the confidentiality and/or non competition covenants in the Franchise Agreement |
Notes:
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- Except where otherwise noted, all fees are payable to Pearce Bespoke, are uniformly imposed, and are non-refundable.
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, the Liquidated Damages fee is payable to the franchisor. Specifically, if a franchisee violates the confidentiality and/or non-competition covenants outlined in the Franchise Agreement, they will be liable for a Liquidated Damages fee of $100,000, in addition to the franchisor's attorney's fees. This fee is payable to Pearce Bespoke.
This stipulation means that prospective Pearce Bespoke franchisees must carefully review and understand the confidentiality and non-competition clauses within the Franchise Agreement. Violating these covenants could result in a significant financial penalty. The $100,000 liquidated damages fee is a substantial amount that could severely impact a franchisee's financial stability.
Franchisees should seek legal counsel to fully comprehend the scope and limitations of these covenants. Understanding what actions constitute a violation is crucial to avoid inadvertently triggering the liquidated damages clause. It is also important to note that the franchisee would be responsible for Pearce Bespoke's attorney's fees in addition to the $100,000.
Liquidated damages clauses are common in franchise agreements to protect the franchisor's confidential information and prevent unfair competition. However, the specific amount and terms can vary widely. Prospective franchisees should compare the liquidated damages provisions of different franchise opportunities to assess the potential financial risks.