Does the Big Blue Swim School non-compete agreement apply to the franchisee's immediate family?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
Upon our termination of this Agreement in compliance with its terms, your termination of this Agreement without cause, or expiration of this Agreement (without the grant of a successor franchise), you and your owners agree that neither you, they, nor any member of your or their Immediate Families will:
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- have any direct or indirect, controlling or non-controlling interest as an owner whether of record, beneficial, or otherwise—in any Competitive Business located or operating:
- a. at the School's site; or
- b. within ten (10) miles of the School's site; or
- c. within ten (10) miles of the physical location of another BIG BLUE Swim School in operation or under construction on the later of the effective date of termination or expiration or the date on which the restricted person begins to comply with this Section 20.F,
provided that this restriction does not prohibit ownership of shares of a class of securities publicly traded on a United States stock exchange and representing less than three percent (3%) of the number of shares of that class of securities issued and outstanding; or
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- perform services as a director, officer, manager, employee, consultant, representative, or agent for a Competitive Business located or operating:
- a. at the School's site; or
b. within ten (10) miles of the School's site; or
c. within ten (10) miles of the physical location of another BIG BLUE Swim School in operation or under construction on the later of the effective date of termination or expiration or the date on which the restricted person begins to comply with this Section 20.F.
The term "Immediate Family" includes the named individual, his or her spouse or domestic partner, and all children of the named individual or his or her spouse or domestic partner.
- (l) before the transfer's proposed effective date, you and your transferring owners (and members of their Immediate Families) agree, for the applicable timeframe beginning on the transfer's effective date, not to engage in any activity proscribed in Sections 20.E and 20.F below;
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Big Blue Swim School Franchise Disclosure Document, the non-compete agreement extends to the franchisee's immediate family under certain conditions. Specifically, upon termination or expiration of the franchise agreement, neither the franchisee, their owners, nor any member of their immediate families can have a direct or indirect interest in a competitive business within a specified radius of the Big Blue Swim School location. This restriction applies to businesses operating at the school's site or within ten miles of it, or within ten miles of another Big Blue Swim School.
The term "Immediate Family" is defined to include the named individual, their spouse or domestic partner, and all children of the named individual or their spouse or domestic partner. This definition clarifies the scope of individuals to whom the non-compete obligations extend, ensuring that family members cannot circumvent the agreement by engaging in competitive activities. The restriction does not prohibit ownership of less than three percent of shares in a publicly-traded company.
Furthermore, the non-compete agreement also restricts the franchisee and their immediate family from performing services for a competitive business within the same geographic limitations. This includes acting as a director, officer, manager, employee, consultant, representative, or agent. The restrictions are designed to protect Big Blue Swim School's market and prevent franchisees from leveraging their knowledge and experience gained during the franchise term to benefit a competing business. Before transferring ownership, the franchisee and their transferring owners (and members of their Immediate Families) must agree not to engage in any activity proscribed in Sections 20.E and 20.F.