Will the Area of Protection remain the same during the successor franchise for a Big Blue Swim School?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
When this Agreement expires (unless it is terminated sooner), you will have the right to acquire a successor franchise to continue operating the School as a BIG BLUE Swim School for ten (10) years under our then-current form of franchise agreement, but only if you:
- (1) have requested in writing and conducted with us a business review at least six (6) months, but not more than nine (9) months, before the end of the Term and then have formally notified us of your desire to acquire a successor franchise no less than three (3) months before the end of the Term;
- (2) have substantially complied with all of your obligations under this Agreement and all other agreements with us or our affiliates related to the School, including operated the School in substantial compliance with Brand Standards, during the Term, as noted in the business review we conduct;
- (3) continue complying substantially with all of your obligations under this Agreement and all other agreements with us or our affiliates related to the School between the time you formally notify us of your desire to acquire a successor franchise and the end of the Term; and
- (4) retain the right to occupy the School at its original site, have remodeled and upgraded the School, and otherwise have brought the School into full compliance with then-applicable specifications and standards for new BIG BLUE Swim Schools (regardless of cost) before this Agreement expires. We have no obligation to grant you a successor franchise if you wish to relocate the School or no longer have the right to occupy the School at its original site.
To acquire a successor franchise, you and your owners must: (i) sign our then-current form of franchise agreement (and related documents), which may contain terms and conditions differing materially from any and all of those in this Agreement, including higher Royalties, Software
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Big Blue Swim School FDD, the Area of Protection in a successor franchise agreement is not guaranteed to remain the same as in the original agreement. To acquire a successor franchise, a franchisee must sign Big Blue Swim School's then-current form of franchise agreement, which may contain terms and conditions that differ materially from the original agreement.
These differing terms and conditions can include higher royalties and software license fees. While the FDD specifies that during a transfer of the franchise, the Area of Protection defined in the original agreement will be substituted into the new franchise agreement for the balance of the initial term, this condition does not apply to successor franchises.
Therefore, when the original franchise term expires and a franchisee seeks a successor franchise, the new agreement could redefine the Area of Protection. This means the franchisee's protected territory could be altered, potentially impacting their business due to increased competition from other Big Blue Swim School locations or other businesses.
Prospective franchisees should carefully review the terms of the then-current franchise agreement at the time of renewal and understand how the Area of Protection may change. It is crucial to discuss this aspect with Big Blue Swim School to fully understand the potential implications for their business before committing to a successor franchise.