What must the transferee-franchisee of a Pearce Bespoke franchise agree to in a written agreement?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
The transferee-franchisee enters into a written agreement in a form satisfactory to Franchisor assuming and agreeing to discharge all of Franchisee's obligations and covenants under this Agreement for the remainder of its term or, at Franchisor's option, executes Franchisor's then-current standard form of franchise agreement which may not contain any further rights of renewal, but may contain royalty rates and advertising contributions (which may be different than those contained in this Agreement), and an altered Franchised Territory;
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, a transferee-franchisee (the person buying an existing franchise) must enter into a written agreement that is satisfactory to Pearce Bespoke. In this agreement, the transferee-franchisee must assume and agree to fulfill all of the original franchisee's obligations and covenants under the existing Franchise Agreement for the remainder of its term.
Alternatively, Pearce Bespoke has the option to require the transferee-franchisee to execute the then-current standard form of the franchise agreement. This new agreement may not include any further rights of renewal for the franchisee.
Furthermore, the new agreement may specify different royalty rates and advertising contributions than those in the original agreement. It may also define an altered franchised territory for the incoming franchisee. This means that the terms of operating the franchise could change significantly upon transfer, potentially affecting the profitability and operational requirements for the new franchisee.