Does Big Blue Swim School have the right to reject a site that does not meet their criteria?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
We will not unreasonably withhold our acceptance of a site if, in our experience and based on the factors outlined above, the proposed site is not inconsistent with sites that we regard as favorable or that otherwise have been successful sites in the past for BIG BLUE Swim Schools. However, we have the absolute right to reject any site not meeting our criteria or to require you to acknowledge in writing that a site you prefer is accepted but not recommended due to its incompatibility with certain factors that bear on a site's suitability as a location for a BIG BLUE Swim School. You must evaluate and ultimately approve the selection of the School's site. (Franchise Agreement—Section 4.B;
Development Rights Agreement—Section 5) We do not own locations for lease to franchisees. Under the DRA, we first must accept each new site you propose for each new BIG BLUE Swim School. Our then-current standards for sites will apply.
We have the right to terminate the Franchise Agreement (and, in limited circumstances, the Development Rights Agreement) if you reject a School site the location and physical and other characteristics of which, and the proposed commercial-lease terms for which (as encompassed in a lease letter of intent that we or your third-party vendor negotiated or reviewed), were accepted by our real-estate committee (a "Qualified Site"). (Franchise Agreement—Section 4.B; Development Rights Agreement—Section 5) There is no refund of any initial franchise fee or development fee upon such termination.
If an acceptable School site is not found and secured within 210 days after the Franchise Agreement's effective date (subject to any permitted extension), then we have the right to terminate the Franchise Agreement. The initial franchise fee is not refundable. (Franchise Agreement—Sections 4.B and 4.C) If we and you (or your affiliate) are parties to a DRA, the negotiated deadlines specified in the DRA will supersede certain deadlines specified above. (DRA—Section 5)
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 37–51)
What This Means (2025 FDD)
According to the 2025 FDD, Big Blue Swim School has the absolute right to reject any site that does not meet their criteria. However, Big Blue Swim School will not unreasonably withhold acceptance of a site if the proposed site is not inconsistent with sites they regard as favorable or that have been successful in the past. Even if a franchisee prefers a site that Big Blue Swim School deems incompatible, the franchisor can require the franchisee to acknowledge in writing that the site is accepted but not recommended.
The franchisee is responsible for locating, evaluating, and selecting the site for their Big Blue Swim School. The franchisee must provide all requested information to allow Big Blue Swim School to assess the proposed site. While Big Blue Swim School will not search for or select the site, they may propose potential sites using local commercial real estate brokers based on their current criteria. These criteria include factors such as population density, demographic characteristics, visibility, traffic flow, competition, accessibility, size, and other physical and commercial characteristics.
Big Blue Swim School also has the right to terminate the Franchise Agreement if the franchisee rejects a Qualified Site, which is a site accepted by Big Blue Swim School's real estate committee based on its location, physical characteristics, and proposed commercial lease terms. If an acceptable site is not secured within 210 days after the Franchise Agreement's effective date, Big Blue Swim School has the right to terminate the agreement, and the initial franchise fee is not refundable. These conditions highlight the importance of aligning site selection with Big Blue Swim School's standards and the potential financial risks associated with site rejection or delays.