What payments must a Creative World School franchisee make before a transfer can be approved?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
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;
(e) you or the transferee pay us a transfer fee equal to the greater of: (a) $20,000 or (b) 25% of our then-current initial franchise fee.
Cost of training the transferee (or its Manager) and its managerial personnel is included in the fee;
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 meet specific financial obligations before a transfer of ownership can be approved. The franchisee must have paid all outstanding royalties, marketing fund contributions, amounts owed for purchases from Creative World School, and any other debts to the company or third-party creditors. Additionally, all required reports and statements must be submitted and up to date.
Furthermore, either the franchisee or the transferee is required to pay a transfer fee to Creative World School. This fee is the greater of $20,000 or 25% of the then-current initial franchise fee. This transfer fee covers the cost of training the transferee or their manager and managerial personnel.
In addition to these payments, the franchisee must also ensure that the proposed transferee meets certain qualifications, such as having sufficient business experience, aptitude, and financial resources to operate the school. The transfer must also include a general release of any claims against Creative World School and its affiliates. These conditions ensure that the transfer process is thorough and that the new owner is well-prepared to maintain the standards of the Creative World School franchise.