What secures the Creative World School promissory note?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
| from the date of this Note at the rate and time later provided, on the balance from time to time | |
|---|---|
| remaining unpaid. The Loan represented by this Note is subject to the terms and conditions of a | |
| CREATIVE WORLD SCHOOL® Franchise Agreement dated | , 201 |
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
Based on the 2025 Creative World School Franchise Disclosure Document, the promissory note is subject to the terms and conditions of the Creative World School Franchise Agreement. This means that the franchise agreement itself provides the framework for the loan represented by the promissory note, indicating that the franchisee's obligations under the franchise agreement are linked to the loan.
This arrangement is typical in franchising, where the franchisor provides financing to the franchisee. The security for the loan is often tied to the franchise agreement, meaning that a breach of the franchise agreement could also trigger a default on the promissory note. This could include failure to meet performance standards, non-payment of royalties, or violation of brand standards.
Prospective Creative World School franchisees should carefully review the franchise agreement and promissory note to understand the specific terms and conditions. They should pay close attention to the events that could trigger a default on the loan and the remedies available to the franchisor in such a case. Understanding these details is crucial for managing the financial risks associated with the franchise.