Is there an exception to the post-termination non-compete clause for Pearce Bespoke franchisees if the termination is a result of the Franchisor's breach?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee (and all Personal Guarantors and owners of all or part of Franchisee) will not, directly or indirectly, for a period of two (2) years after this Agreement expires or is terminated (except for a termination as a result of a Franchisor's breach), on their own account or as an employee,
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to Pearce Bespoke's 2025 Franchise Disclosure Document, there is an exception to the post-termination non-compete clause if the franchise agreement is terminated as a result of the Franchisor's breach. Specifically, the standard two-year non-compete restriction does not apply in cases where Pearce Bespoke is the party responsible for the termination.
This exception is a significant benefit for franchisees. It means that if Pearce Bespoke violates the franchise agreement, forcing the franchisee to terminate the agreement, the franchisee is not restricted from immediately engaging in a similar business. This allows the franchisee to continue earning a living without being penalized for Pearce Bespoke's actions.
It is important for prospective franchisees to fully understand the circumstances that would constitute a breach by Pearce Bespoke that would justify termination and release them from the non-compete obligations. Consulting with a legal professional to review the franchise agreement and understand these rights is advisable.