Does Pearce Bespoke require a renewal provision in its franchise agreements?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Term.
The term of this Agreement will be for ten (10) years commencing on the Effective Date, unless terminated sooner in accordance with the terms hereof.
B. Renewal.
Franchisee will have the right to renew its Pearce Bespoke franchise for the Franchised Territory for two (2) successive five (5) year terms, provided Franchisee meets the following conditions:
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- Franchisee has given Franchisor written notice at least one hundred eighty (180) days before the end of the term of this Agreement of its intention to renew; and
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- Franchisee has complied with all of the material provisions of this Agreement, including the payment of all monetary obligations owed by Franchisee to Franchisor and its affiliates and suppliers, and has complied with Franchisor's material operating and brand standards and procedures and meets all current brand standards during the term of the Franchise Agreement; and
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- Franchisee has at its expense made such reasonable capital expenditures necessary to replace and modernize the supplies, items, and custom equipment in Franchisee's business so that Franchisee's business reflects the then current requirements of a new Pearce Bespoke Franchise; and
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- At Franchisor's discretion, assist Franchisor or its designee with an audit of the Pearce Bespoke Franchise, which shall be conducted by Franchisor or its designee, including without limitation, a financial audit and an operational audit to determine their compliance with then current brand standards. Any deficiencies identified during the audit must be satisfied prior to the expiration of the then current term. If any audit reveals any deficiencies the costs incurred by Franchisor in connection with any such audit are payable upon demand by Franchisee prior to the expiration of the then existing term, including any audit costs, transportation, lodging, meals, and any other expenses incurred.
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- Franchisee has paid a Renewal Fee equal to the greater of (i) Five Thousand Dollars ($5,000.00), or (ii) twenty-five percent (25%) of the then-current franchise fee to Franchisor at least thirty (30) days before the expiration of the initial (and any renewal) term of this Agreement expires; and
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- Execute prior to the expiration of the then existing term the then-current Franchise Agreement, provided, however, that Franchisee will be required to p
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, franchisees have the option to renew their franchise agreement for two additional terms, each lasting five years. This right to renew is contingent upon meeting specific conditions set by Pearce Bespoke.
To qualify for renewal, a franchisee must provide written notice of their intent to renew at least 180 days before the current term expires. They must also demonstrate full compliance with all material provisions of the Franchise Agreement, including timely payment of all financial obligations to Pearce Bespoke, its affiliates, and suppliers. Furthermore, franchisees must adhere to Pearce Bespoke's operational and brand standards throughout the term of the agreement and meet all current brand standards at the time of renewal.
Additional requirements include making necessary capital expenditures to modernize and replace supplies and equipment to reflect the standards of a new Pearce Bespoke franchise. Franchisees must also cooperate with an audit conducted by Pearce Bespoke to ensure compliance with brand standards, covering financial and operational aspects. Any deficiencies identified in the audit must be rectified before the current term's expiration, and the franchisee is responsible for covering the costs associated with the audit if deficiencies are found.
Finally, franchisees must pay a renewal fee equal to the greater of $5,000 or 25% of the then-current initial franchise fee, at least 30 days before the expiration of the current term. They must also execute the then-current Franchise Agreement, which will not include any further renewal rights but may contain continuing rates. This new agreement replaces the initial franchise fee with the renewal fee.