What standards must the proposed transferee meet to be approved by Creative World School?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
divorce, insolvency or corporate or partnership dissolution proceeding or otherwise by operation of law;
(v) transfer of an interest in you, this Agreement or the School, in the event of your death or the death of one of your owners, by will, declaration of or transfer in trust or under the laws of intestate succession; or
(vi) pledge of this Agreement (to someone other than us) or of an ownership interest in you as security, foreclosure upon the School or your transfer, surrender or loss of possession, control or management of the School.
15.03 Conditions for Approval of Transfer. 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. The proposed transferee and its direct and indirect owners must be individuals of good character and otherwise meet our then applicable standards for School franchisees. A transfer of ownership, possession or control of the School may be made only in conjunction with a transfer of this Agreement. 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:
- (a) the transferee has sufficient business experience, aptitude and financial resources to Construct (if necessary) and operate the School;
- (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;
- (c) the transferee (or its Manager) and its managerial employee (if different from your manager) have agreed to complete our standard training program;
- (d) the transferee has agreed to be bound by all of the terms and conditions of this Agreement;
- (e) you or the transferee pay us a t
Source: Item 23 — RECEIPTS (FDD pages 80–247)
What This Means (2025 FDD)
According to Creative World School's 2025 Franchise Disclosure Document, a proposed transferee must meet several conditions to be approved. The transferee and its direct/indirect owners must be of good character and meet Creative World School's standards for franchisees at the time of the transfer. A transfer of ownership can only occur with the transfer of the Franchise Agreement itself.
Specifically, the transferee must demonstrate sufficient business experience, aptitude, and financial resources to construct (if necessary) and operate the school. All outstanding payments, including royalties, marketing fund contributions, and amounts owed for purchases, must be settled, and all required reports submitted. The transferee (or its Manager) and its managerial employee (if different from your manager) must agree to complete Creative World School's standard training program and agree to be bound by all the terms and conditions of the Franchise Agreement.
Additionally, either the current franchisee or the transferee must pay a transfer fee equal to the greater of $20,000 or 25% of Creative World School's then-current initial franchise fee. The transferring franchisee must execute a general release of all claims against Creative World School and its affiliates. Creative World School must also approve the material terms and conditions of the transfer, ensuring that the price and payment terms do not adversely affect the transferee's operation of the school.
These conditions ensure that any new franchisee is well-qualified and financially stable, protecting the Creative World School brand and the interests of other franchisees. Prospective franchisees should carefully consider these requirements and ensure they can meet them before attempting to transfer their franchise.