What payments must be current before a Creative World School franchise transfer can be approved?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
If you (and your owners) are in full compliance with this Agreement then we will approve a transfer that meets all the applicable requirements of this Section.
If the transfer is of this Agreement or a controlling interest in you, or is one of a series of transfers which in the aggregate constitute the transfer of this Agreement or a controlling interest in you, all of the following conditions must be met prior to or concurrently with the effective date of the transfer:
- (b) you have paid all Royalties, Marketing Fund contributions, amounts owed for purchases from us and all other amounts owed to us or to third-party creditors and have submitted all required reports and statements;
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
According to Creative World School's 2025 Franchise Disclosure Document, a franchisee must be current on all financial obligations to both the franchisor and third-party creditors before a transfer of ownership can be approved. Specifically, all Royalties, Marketing Fund contributions, amounts owed for purchases from Creative World School, and all other amounts owed to Creative World School or to third-party creditors must be paid.
This requirement ensures that the Creative World School franchise system maintains financial stability and that new owners are not burdened with pre-existing debts. It also protects the interests of the franchisor and any third-party creditors who have extended credit or services to the franchisee.
For a prospective franchisee, this means that if they are considering purchasing an existing Creative World School franchise, they should verify that all outstanding payments have been made current by the seller. Failure to do so could delay or prevent the transfer of the franchise. It is a standard practice in franchising to require all debts to be settled before a transfer is approved, safeguarding the brand and the financial health of the franchise system.