Under what condition will the termination of the Pearce Bespoke Development Agreement NOT constitute cause for termination of a previously executed Franchise Agreement?
Pearce_Bespoke Franchise · 2025 FDDAnswer from 2025 FDD Document
Notwithstanding anything to the contrary herein, a termination of this Agreement resulting from your failure to open and thereafter operate Businesses in accordance with the Development Schedule will not, in itself, constitute cause for us to terminate any previously executed Franchise Agreement in effect at the time of such termination.
Source: Item 23 — RECEIPTS (FDD pages 39–172)
What This Means (2025 FDD)
According to the 2025 Pearce Bespoke Franchise Disclosure Document, the termination of the Area Development Agreement will not automatically trigger the termination of a pre-existing Franchise Agreement if the termination results from the franchisee's failure to meet the development schedule.
Specifically, if a Pearce Bespoke franchisee with an existing franchise fails to open and operate the number of businesses outlined in the Development Schedule, leading to the termination of the Development Agreement, this failure alone will not be grounds for Pearce Bespoke to terminate any Franchise Agreements already in effect at the time of the Development Agreement's termination. This provision protects franchisees who may have an initial successful location but struggle to meet the expansion requirements of the Development Agreement.
This clause provides a degree of security for franchisees who have already established a Pearce Bespoke business. It allows them to continue operating their existing franchise even if they cannot fulfill the obligations of the Development Agreement, which typically involves opening multiple locations within a specified timeframe. However, it's important to note that other breaches of the Franchise Agreement could still lead to termination, regardless of the status of the Development Agreement.