Is the license granted to a Goldfish Swim School franchisee exclusive, allowing them to be the only Goldfish Swim School in a specific area?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
is Agreement and Franchisor will determine in its sole discretion the Area of Primary Responsibility and insert that description into Exhibit 10.
2.4 Sub-franchising/Agents
Franchisee shall not sublicense the use of the System or Marks to any person or entity. Except as may be permitted pursuant to Section 18, Franchisee shall not grant any person or entity the right to perform any part of Franchisee's rights or obligations licensed hereunder.
2.5 Area of Primary Responsibility
Franchisee shall receive a territory called the Designated Area or "Area of Primary Responsibility" as determined by Franchisor and described and depicted in the map in Exhibit 10 to this Agreement. If at the time of execution of this Agreement, the Approved Location is not available, when the Approved Location is determined, its address shall be inserted into Exhibit 10 to this Agreement and Franchisor will determine in its sole discretion the Area of Primary Responsibility and insert that description into Exhibit 10. Franchisee will operate the Franchised Swim School in the designated Area of Primary Responsibility. As long as this Agreement is in full force and effect and Franchisee is not in default under any of the terms hereof, Franchisor will not establish other franchised or company-owned swim schools using the System with a physical location in your Area of Primary Responsibility. Franchisee's rights in the Area of Primary Responsibility are subject to Franchisor's rights articulated in Section 2.7.
2.6 Map and Description of Area of Primary Responsibility
The Description of the Designated Area or Area of Primary Responsibility and the map depicting the Designated Area or Area of Primary Responsibility shall be designated by Franchisor and attached to this Agreement as Exhibit 10.
2.7 Franchisor's Rights
Franchisee acknowledges that except to the extent provided in Section 2.5 above, Franchisor expressly retains all rights and discretion with respect to the Marks and System, including the right to:
2.7.1 establish, own or operate, and license others to establish, own or operate, Goldfish Swim Schools with a physical location outside of the Area of Primary Responsibility as Franchisor deems appropriate;
- 2.7.2 establish, own or operate, and license others to establish, own or operate other non-swim lesson based businesses under other systems using the same or other trademarks at locations inside and outside of the Area of Primary Responsibility;
- 2.7.3 purchase or otherwise acquire the assets or controlling ownership of one (1) or more businesses identical or similar to the Franchised Swim School (and/or acquire franchise, license and/or similar agreements for such businesses), some or all of which may be located anywhere, including within the Area of Primary Responsibility. If Franchisor purchases or acquires franchises or licenses, Franchisor may, in its sole discretion, act as franchisor or licensor with respect to such franchisees or licensees wherever located, pursuant to the individual franchise or license agreement(s) between Franchisor and such franchisee(s) or licensee(s). If Franchisor purchases or acquires such businesses within the Area of Primary Responsibility which are not franchised or licensed, Franchisor may, in its sole discretion:
- 2.7.3.1 offer to sell any such businesses to Franchisee or to any third party at the business's fair market value to be operated as a Goldfish Swim School; or
- 2.7.3.2 offer Franchisee the opportunity to operate such business(s) in partnership with Franchisor (or an Affiliate) under the business(s) existing trade name or a different trade name.
- 2.7.4 be acquired (regardless of the form of transaction) by any business, even if the other business operates, franchises and/or licenses Competitive Businesses within the Area of Primary Responsibility;
Source: Item 23 — RECEIPTS (FDD pages 77–389)
What This Means (2025 FDD)
According to the 2025 Goldfish Swim School Franchise Disclosure Document, franchisees are granted an Area of Primary Responsibility. Goldfish Swim School will not establish other franchised or company-owned swim schools using their system with a physical location in the franchisee's Area of Primary Responsibility as long as the Franchise Agreement is in full effect and the franchisee is not in default. However, the franchisee's rights in their Area of Primary Responsibility are subject to Goldfish Swim School's rights articulated in Section 2.7 of the agreement.
Goldfish Swim School retains specific rights, including the right to establish, own, operate, and license others to establish, own, or operate Goldfish Swim Schools with a physical location outside of the Area of Primary Responsibility as they deem appropriate. This means that while franchisees have some territorial protection, Goldfish Swim School can still expand outside of those areas.
Goldfish Swim School also retains the right to establish, own, or operate other non-swim lesson based businesses under other systems using the same or other trademarks at locations inside and outside of the Area of Primary Responsibility. They can also purchase or acquire businesses identical or similar to the Franchised Swim School, some or all of which may be located anywhere, including within the Area of Primary Responsibility. These stipulations mean that Goldfish Swim School retains considerable latitude to operate or acquire businesses, even those that might compete, within or near a franchisee's territory under certain conditions.
Furthermore, Goldfish Swim School retains the right to provide services and sell products authorized for Goldfish Swim Schools through alternate channels of distribution other than a Franchised Swim School situated within the Area of Primary Responsibility, including the internet, retail outlets, mail order, or any other channel of distribution. This indicates that a franchisee's protected territory applies only to physical Goldfish Swim School locations and not to other methods of service or product delivery. Therefore, while a franchisee is granted an Area of Primary Responsibility, this area is subject to numerous exceptions and retained rights by Goldfish Swim School.