Does the restriction on operating a Competitive Business after termination of the Goldfish Swim School Franchise Agreement extend to the franchisee's territory if it is greater than 25 miles?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
- b) During the term of Individual's relationship with Franchisee, Individual shall not, directly or indirectly, for themselves or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other business entity, carry on, be engaged in or take part in, render services to, operate, or own or share in the earnings of any Competitive Business anywhere within the United States without the express written consent of Company, and for a period of two (2) years thereafter, regardless of the cause of termination, Individual shall not, directly or indirectly, for themselves or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other business entity, carry on, be engaged in or take part in, render services to, operate, or own or share in the earnings of any Competitive Business (a) within a twenty-five (25) mile radius of the location of Franchisee's Franchised Swim School or within Franchisee's territory as provided in the Franchise Agreement (whichever is greater), or (b) within a twenty-five (25) mile radius of the location of any other Goldfish Swim School in existence at the time of termination or expiration, without the express written consent of Company.
Source: Item 23 — RECEIPTS (FDD pages 77–389)
What This Means (2025 FDD)
According to Goldfish Swim School's 2025 Franchise Disclosure Document, the post-termination covenant not to compete restricts a franchisee from engaging in a Competitive Business for two years after the termination or expiration of the Franchise Agreement. This restriction applies regardless of the cause of termination.
The restriction extends to (a) within a twenty-five (25) mile radius of the location of Franchisee's Franchised Swim School or within Franchisee's territory as provided in the Franchise Agreement (whichever is greater), or (b) within a twenty-five (25) mile radius of the location of any other Goldfish Swim School in existence at the time of termination or expiration, without the express written consent of Company.
Thus, if a Goldfish Swim School franchisee's territory is larger than a 25-mile radius from their swim school's location, the non-compete extends to the full territory. This means a franchisee could not operate a competitive business within their larger territory for two years after the franchise agreement ends. This restriction also applies within a 25-mile radius of any other Goldfish Swim School.