What is the 'Carved-Out Area' in relation to a Big Blue Swim School franchise territory?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
exercisable more than once during this DRA's term. In addition, except as noted in clause (c) below, the exercise of the Qualified Site Lease Rights will not modify or otherwise affect your obligation to comply strictly with the Schedule. We have the right to terminate this DRA under Section 7 above if you do not
timely satisfy any deadline under the Schedule notwithstanding our exercise (directly or through another franchisee) of the Qualified Site Lease Rights.)
- (b) If we exercise the Qualified Site Lease Rights (directly or through another franchisee), we have the unilateral right to amend immediately the definition and scope of the Territory to carve out and exclude from the Territory both (i) the BIG BLUE Swim School site that is the subject of the Qualified Site Lease Rights and (ii) an area of protection around that site the size and description of which will be consistent with the size and description of areas of protection that we customarily have granted or would grant to a franchisee developing a BIG BLUE Swim School in a similar market area. (This excised portion of the Territory is referenced as the "Carved-Out Area.") Our amendment of the Territory definition and scope will be effective upon our delivery of written notice to you. Your Territory definition otherwise will not be altered. After we deliver such written notice to you, you no longer will have any BIG BLUE Swim School development rights under this DRA in the Carved-Out Area.
- (c) Our or another franchisee's construction, development, and operation of a BIG BLUE Swim School within the Carved-Out Area, as permitted by the Qualified Site Lease Rights, will not count toward your compliance with the Schedule. However, each time the Qualified Site Lease Rights are exercised, you may elect to develop one less BIG BLUE Swim School in the Territory (based on the number of BIG BLUE Swim Schools remaining to be constructed and developed under the Schedule). You must noti
Source: Item 23 — RECEIPTS (FDD pages 76–278)
What This Means (2025 FDD)
According to Big Blue Swim School's 2025 Franchise Disclosure Document, a 'Carved-Out Area' refers to a specific portion of a franchisee's territory that Big Blue Swim School may remove under certain conditions. This occurs if Big Blue Swim School exercises its Qualified Site Lease Rights, either directly or through another franchisee.
Specifically, the 'Carved-Out Area' includes the Big Blue Swim School site that is the subject of the Qualified Site Lease Rights, as well as an area of protection around that site. The size and description of this protected area will align with the areas of protection Big Blue Swim School typically grants to franchisees developing a location in a similar market. Once Big Blue Swim School notifies the franchisee in writing, the amendment to the territory definition becomes effective, and the franchisee loses all development rights in the Carved-Out Area.
Big Blue Swim School's or another franchisee's operation within the Carved-Out Area does not count towards the original franchisee's development schedule. However, each time Big Blue Swim School exercises these rights, the franchisee can elect to develop one less Big Blue Swim School in their territory. The franchisee must notify Big Blue Swim School of this election within 30 days of receiving notice about the Carved-Out Area. If the franchisee chooses this option, the final Big Blue Swim School on their development schedule is removed, and Big Blue Swim School will refund the pro rata portion of the development fee associated with that location within 30 days of the notification.