What is the 'Payment Day' for Creative World School royalty payments?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
We will designate the date each month (the "Payment Day") for the Royalty payment.
You agree to comply with the procedures we specify in our Manuals and perform such acts and sign and deliver such documents as may be necessary to accomplish payment by this method.
On the Payment Day, you will report to us by telephone or electronic means or on written form, as we direct, the School's true and correct Gross Revenues and Adjusted Gross Revenues for the immediately preceding week.
You will give us authorization, in a form that we designate, to initiate debit entries or credit correction entries to the School's bank operating account (the "Account") for payments of Royalties and other amounts due under this Agreement, including any applicable interest charges.
For new Schools, you must provide this authorization at least 30 days prior to opening your School.
You will make the funds available in the Account for withdrawal by electronic transfer no later than the Payment Day.
The amount actually transferred from the Account to pay Royalties will be based on the School's Adjusted Gross Revenues reported to us.
If you have not reported the School's Adjusted Gross Revenues to us for any reporting period, we will transfer from the Account an amount calculated in accordance with our reasonable estimate of the School's Adjusted Gross Revenues during any such reporting period.
If we determine at any time that you have underreported Gross Revenues or Adjusted Gross Revenues or underpaid Royalties or other amounts due to us, we will be authorized to immediately initiate a transfer from the Account in the appropriate amount in accordance with the foregoing procedures, including applicable interest and late charges.
Any overpayment will be credited to the Account through a credit, effective as of the first reporting date after you and we determine that such credit is due.
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
According to Creative World School's 2025 Franchise Disclosure Document, the specific date for the 'Payment Day' each month for royalty payments will be designated by the franchisor. The franchisee must authorize Creative World School to initiate debit entries from the school's bank operating account for royalty payments and other amounts due, including interest charges. This authorization must be provided at least 30 days before the school opens.
On the Payment Day, the franchisee is required to report the school's Gross Revenues and Adjusted Gross Revenues for the preceding week via telephone, electronic means, or written form, as directed by Creative World School. The funds for the royalty payment must be available in the franchisee's account for electronic transfer on the Payment Day. The actual amount transferred will be based on the reported Adjusted Gross Revenues.
If the franchisee fails to report Adjusted Gross Revenues, Creative World School will estimate the revenues and transfer an amount based on that estimate. If Creative World School determines that the franchisee has underreported revenues or underpaid royalties, they are authorized to immediately transfer the appropriate amount from the franchisee's account, including interest and late charges. Overpayments will be credited back to the franchisee's account on the first reporting date after the overpayment is determined.
This payment system ensures that Creative World School receives royalty payments in a timely and consistent manner. It also places the responsibility on the franchisee to accurately report their revenues and maintain sufficient funds in their account. Prospective franchisees should be aware of these requirements and ensure they have the necessary systems in place to comply with them.