What happens if a lender forecloses on the assets of my Big Blue Swim School?

According to the 2025 Big Blue Swim School FDD, if a lender forecloses on its lien on a substantial and material portion of the School's assets, it constitutes a cause for termination of the franchise agreement. This means that Big Blue Swim School has the right to terminate the franchise agreement if a lender forecloses on a significant portion of your school's assets.

If Big Blue Swim School terminates the agreement for this cause, or if the franchisee terminates the agreement without cause, before the term's scheduled expiration, the franchisee acknowledges that Big Blue Swim School will suffer substantial damages. These damages include lost royalties, lost brand fund contributions, lost market penetration and goodwill, loss of Big Blue Swim School representation in the School's market area, customer confusion, lost opportunity costs, and expenses that Big Blue Swim School will incur in developing or finding another franchisee to develop another Big Blue Swim School in the School's market area.

Because these brand damages are difficult to estimate accurately, the franchisee agrees to pay liquidated damages. These damages are equal to the product of either 24 or the number of months that would have remained in the Term, whichever is shorter, multiplied by the average monthly Royalties and Brand Fund contributions that were due and payable to Big Blue Swim School during the twelve months before the month of termination, or for such lesser period that the School has been open, if less than twelve months.