What is the transfer fee for a non-controlling ownership interest transfer at Big Blue Swim School?
Big_Blue_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
your creditors or any financial institution. Any security interest that may be created in this Agreement by virtue of Section 9-408 of the Uniform Commercial Code is limited as described in Section 9-408(d) of the Uniform Commercial Code.
17.C. Conditions for Approval of Transfer
If you and your owners are in full compliance with this Agreement, then, subject to this Section 17's other provisions:
We will approve the transfer of a non-controlling ownership interest in you if the proposed transferee and its owners are of good moral character, have no ownership interest
in and do not perform services for (and have no affiliates with an ownership interest in or performing services for) a Competitive Business, otherwise meet our then-applicable standards for non-controlling owners of BIG BLUE Swim School franchisees, sign our then-current form of Guaranty and Assumption of Obligations and pay us a Five Thousand Dollar ($5,000) transfer fee. The term "controlling ownership interest" is defined in Section 22.M.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to Big Blue Swim School's 2025 Franchise Disclosure Document, the transfer of a non-controlling ownership interest is subject to a $5,000 transfer fee. This fee is required to be paid to Big Blue Swim School. In addition to the fee, the proposed transferee and their owners must meet specific criteria, including demonstrating good moral character and not having an ownership interest in a competitive business. They must also meet Big Blue Swim School's standards for non-controlling owners and sign a Guaranty and Assumption of Obligations form.
However, if the transfer is to or among the franchisee's owners, their immediate family members, or an entity they control, a different transfer fee applies. In this specific scenario, the transfer fee increases to $12,500. This higher fee suggests that Big Blue Swim School differentiates between transfers to outside parties and those within the franchisee's existing network or family, potentially reflecting different levels of administrative and due diligence efforts required.
It is important to note that these fees and conditions are subject to change, and the specific requirements in place at the time of the proposed transfer will govern. A prospective franchisee should carefully review Section 17 of the franchise agreement for a complete understanding of the transfer process and associated obligations. Additionally, the franchisee must be in full compliance with the agreement for any transfer to be considered.