Who must personally guarantee all obligations under the Franchise Agreement for a Big Blue Swim School?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) You (and/or your Approved Affiliates) will operate each BIG BLUE Swim School under a separate franchise agreement (and related documents) with us. The franchise agreement (and related documents, including Guaranty and Assumption of Obligations) that you and your owners (or your Approved Affiliate and its owners) must sign for each BIG BLUE Swim School to be constructed and developed pursuant to this DRA will be our then-current form of franchise agreement (and related documents, including Guaranty and Assumption of Obligations), any or all terms of which may differ substantially and materially from any or all terms contained in the First Franchise Agreement. However, each of the:
- (i) Royalty;
- (ii) Brand Fund contribution;
- (iii) Software License Fee;
- (iv) Local Marketing Spending Requirement; and
- (v) minimum required Market Introduction Program expense,
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 59–61)
What This Means (2025 FDD)
According to Big Blue Swim School's 2025 Franchise Disclosure Document, if a franchisee or their owners establish a new legal entity to develop and operate a Big Blue Swim School, they will be required to sign a Guaranty and Assumption of Obligations. This document ensures that the franchisee and their owners personally guarantee the obligations under the Franchise Agreement.
Specifically, the franchisee and their owners must sign the Guaranty and Assumption of Obligations for each Big Blue Swim School to be constructed and developed under the Development Rights Agreement (DRA). This requirement applies to the then-current form of the franchise agreement and related documents, which may differ substantially from the initial Franchise Agreement.
This means that prospective Big Blue Swim School franchisees should be aware that they, along with their owners, will be held personally liable for the financial and operational obligations of each franchised location, even if those locations are operated through a separate legal entity. This personal guarantee is a standard practice in franchising and is intended to ensure the franchisee's commitment to the success of the business.