What is the definition of 'Incapacity' in relation to the Goldfish Swim School franchise agreement?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
18.6 Transfer by Death or Incapacity
18.6.1 Upon the death or Incapacity of Franchisee (if Franchisee is an individual) or any holder of a legal or beneficial interest in Franchisee (if Franchisee is a business entity), the appropriate representative of such person (whether administrator, personal representative or trustee) shall, within a reasonable time not exceeding one hundred eighty (180) days following such event, transfer such individual's interest in the Franchised Swim School or in Franchisee to a third party approved by Franchisor. Such transfers, including transfers by will or inheritance shall be subject to the conditions for assignments and transfers contained in this Agreement, unless prohibited by the laws of the state wherein Franchisee resided, with such choice of law provision being applicable only for this Section 18.6. During such one hundred eighty (180) day period, the Franchised Swim School must remain at all times under the primary
Source: Item 23 — RECEIPTS (FDD pages 77–389)
What This Means (2025 FDD)
According to the 2025 Goldfish Swim School Franchise Disclosure Document, Section 1 defines various terms used in the agreement; however, the definition of 'Incapacity' is not among them. The document does mention 'Incapacity' in the context of transferring ownership due to death or incapacity in Section 18.6.1.
Since the FDD does not explicitly define 'Incapacity', it is important for a prospective franchisee to understand what specific circumstances would be considered an 'Incapacity' that would trigger the transfer provisions of the franchise agreement. This is a crucial point, as it could significantly impact the franchisee's ability to operate the Goldfish Swim School and their family's future.
A potential franchisee should seek clarification from Goldfish Swim School regarding the criteria and documentation required to establish 'Incapacity'. Understanding this term is essential for both individual franchisees and those operating as a business entity, as the incapacity of a key individual could have serious implications for the franchise's operation and ownership.