In Michigan, can Goldfish Swim School exercise a right of first refusal to purchase a Goldfish Swim School franchise?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
FOR THE STATE OF MICHIGAN
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- THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU.
- A prohibition of your right to join an association of Franchisees.
- A requirement that you assent to a release, assignment, novation, waiver or estoppel that deprives you of rights and protections provided in this act. This shall not preclude you, after entering into a Franchise Agreement, from settling any and all claims.
- A provision that permits us to terminate a franchise prior to the expiration of this term except for good cause. Good cause shall include your failure to comply with any lawful provision of the Franchise Agreement and to cure the failure after being given written notice of the failure and a reasonable opportunity, which in no event need be more than 30 days, to cure the failure.
- A provision that permits us to refuse to renew a franchise without fairly compensating you by repurchase or other means for the fair market value at the time of expiration of your inventory, supplies, equipment, fixtures and furnishings. Personalized materials that have no value to us and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct of the Franchised Swim School are not subject to compensation. This subsection applies only if: (a) the term of the franchise is less than 5 years, and (b) you are prohibited by the franchise agreement or other agreement from continuing to conduct substantially the same business under another trademark, service mark, trade name, logotype, advertising or other commercial symbol in the same area subsequent to the expiration of the franchise or you do not receive at least 6 months advance notice of our intent not to renew the franchise.
- A provision that permits us to refuse to renew a franchise on terms generally available to other Franchisees of the same class or type under similar circumstances. This section does not require a renewal provision.
Source: Item 22 — CONTRACTS (FDD pages 76–77)
What This Means (2025 FDD)
The 2025 Goldfish Swim School Franchise Disclosure Document includes specific stipulations for Michigan franchisees. According to the FDD, Michigan law prohibits certain unfair provisions that are sometimes included in franchise documents. If any of these prohibited provisions are present in the Goldfish Swim School franchise documents, they are considered void and unenforceable against the franchisee.
Among the provisions that Michigan law prohibits is anything that requires the franchisee to waive rights and protections provided under the act. There is no mention of a right of first refusal being prohibited.
Prospective franchisees in Michigan should carefully review the franchise agreement and related documents with legal counsel to ensure full compliance with Michigan law and to understand their rights and obligations. Understanding these protections is crucial for making an informed decision about investing in a Goldfish Swim School franchise in Michigan.