What is the relevant section of the U.S. Code regarding bankruptcy that may affect Pearce Bespoke's termination rights?

According to Pearce Bespoke's 2025 Franchise Disclosure Document, the franchisor's right to terminate a franchise agreement upon the franchisee's bankruptcy may not be enforceable under federal bankruptcy law. Specifically, this is addressed under Title 11 of the United States Code (11 U.S.C. §101 et. seq.).

This information is part of an addendum to the FDD required by the state of Maryland. This addendum clarifies that certain provisions in Pearce Bespoke's franchise documents are amended to comply with Maryland Franchise Law. The statement regarding bankruptcy law serves as a protective measure for franchisees, acknowledging that federal law may supersede the termination clauses related to bankruptcy within the franchise agreement.

For a prospective Pearce Bespoke franchisee, this means that if they were to file for bankruptcy, Pearce Bespoke's ability to automatically terminate the franchise agreement might be restricted by the protections afforded under federal bankruptcy law. It is important for franchisees to consult with a legal professional to understand their rights and obligations under both the franchise agreement and federal bankruptcy law.