Does Goldfish Swim School have a right of first refusal if I attempt to sell my franchise?
Goldfish_Swim_School Franchise · 2025 FDDAnswer from 2025 FDD Document
If you attempt to sell your franchised swim school or transfer your interest from the franchised swim school to a third party, we may exercise our right of first refusal.
19.1 Submission of Offer
If Franchisee, or any of its owners, proposes to sell or otherwise transfer (including a transfer by death or Incapacity pursuant to Section 18.6) the Franchised Swim School (or any of its assets outside of the normal course of business), any ownership interest in Franchisee or any ownership interest in the Franchise granted hereunder, Franchisee shall obtain and deliver a bona fide, binding, executed written agreement to purchase such interest of Franchisee only, along with all pertinent documents including any contract or due diligence materials, to Franchisor. The offer must apply only to an approved sale of the assets or interests listed above and may not include any other property or rights of Franchisee or any of its owners.
19.2 Franchisor's Right to Purchase
Franchisor shall, for sixty (60) days from the date of delivery of all such documents, have the right, exercisable by written notice to Franchisee, to purchase the offered assets or interest for the price and on the same terms and conditions contained in such agreement communicated to Franchisee. Franchisor has the right to substitute cash for the fair market value of any form of payment proposed in such offer. Franchisor's credit shall be deemed at least equal to the credit of any proposed buyer. After providing notice to Franchisee of Franchisor's intent to exercise this right of first refusal, Franchisor shall have up to ninety (90) days to close the purchase. Franchisor shall be entitled to receive from Franchisee all customary representations and warranties given by Franchisee as the seller of the assets or such ownership interest or, at Franchisor's election, such representations and warranties contained in the agreement. Prior to closing, Franchisor may assign its rights under this section to an affiliate of Franchisor.
Source: Item 12 — TERRITORY (FDD pages 42–44)
What This Means (2025 FDD)
According to Goldfish Swim School's 2025 Franchise Disclosure Document, Goldfish Swim School does have a right of first refusal if a franchisee attempts to sell their franchised swim school or transfer their interest to a third party.
Specifically, if a franchisee proposes to sell or transfer the franchised swim school, its assets (outside the normal course of business), or any ownership interest, the franchisee must obtain and deliver a binding, executed written agreement to Goldfish Swim School Franchising LLC. This agreement must pertain only to the approved sale of the assets or interests mentioned and cannot include any other property or rights of the franchisee or its owners.
Goldfish Swim School then has 60 days from the date of delivery of all documents to exercise its right to purchase the assets or interest at the same price, terms, and conditions as in the agreement. Goldfish Swim School can substitute cash for the fair market value of any proposed form of payment and their credit is deemed at least equal to any proposed buyer. After providing notice of intent to exercise this right, Goldfish Swim School has up to 90 days to close the purchase. Goldfish Swim School is entitled to customary representations and warranties from the franchisee as the seller. Prior to closing, Goldfish Swim School may assign its rights to an affiliate.