Under what conditions is the deposit for a Creative World School refundable?
Creative_World_School Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Expenditure (1) | Low Amount | High Amount | Method Of Payment | When Due | To Whom Payment is to be Made | |
|---|---|---|---|---|---|---|
| Initial Franchise Fee (1)(2) | $75,000 | $80,000 | Lump Sum | Signing Franchise Agreement | Us | |
| Building / Leasehold Improvements, not including landscaping, irrigation, sidewalk, trail and fencing (4) | $3,500,000 | $6,000,000 | As Agreed | By agreement with provider | Lessors, Contractors, Subs | |
| Landscaping, Irrigation, Sidewalk, Trail, Fencing, Playground Equipment, and Playground Surfacing (4) | $800,000 | $1,000,000 | Lump Sum or Installments | As Incurred | Third Parties | |
| Impact Fees and Utility Connection Fees | $100,000 | $500,000 | Lump Sum | Prior to construction | City/County | |
| Land Costs (5) | $750,000 | $1,500,000 | As Agreed | By agreement with provider | Sellers | |
| Architectural/Enginee ring, Legal & Accounting Services (6) | $175,000 | $250,000 | As Agreed | By agreement with provider | Suppliers | |
| Training Expenses | $10,000 | $20,000 | As Agreed | As Incurred | Suppliers | |
| (lodging, food, travel) | ||||||
| Opening Package Fee (3) | $275,000 | $500,000 | As Agreed | By agreement with us or our designee | Us, or our Affiliate | |
| Accreditation Fee | $2,000 | $2,000 | Lump Sum | As Incurred | Us or Suppliers | |
| Systems Standards | $1,050 | $1,500 | Lump Sum | Monthly | Us | |
| Fee (3 months) | ||||||
| Signage | $12,000 | $20,000 | Lump Sum | Within 60 days of opening School | Suppliers | |
| Opening Inventory and Supplies (7) | $15,000 | $20,000 | Lump Sum | Within 60 days of opening School | Suppliers | |
| Type of Expenditure (1) | Low Amount | High Amount | Method Of Payment | When Due | To Whom Payment is to be Made | |
| Grand Opening Advertising | $15,000 | $50,000 | As Incurred | Within 60 days of opening School | Third Parties | |
| Utility Deposits | $3,000 | $10,000 | As Incurred | Prior to opening | Third Parties | |
| Insurance (8) | $9,000 | $40,000 | Lump sum | As Incurred | Third Parties | |
| Additional Funds ‒ 3 | $25,000 | $150,000 | As Incurred | As Incurred | Third Parties | |
| months(9) | ||||||
| TOTAL ESTIMATED | $5,767,050 | $10,143,500 | ||||
| INITIAL | ||||||
| INVESTMENT | ||||||
| UNDER THE | ||||||
| FRANCHISE | ||||||
| PROGRAM(9) | #### Explanatory Notes |
- (1) All fees payable to us or our affiliate are non-refundable, except for the Deposit. At our discretion, we may require a $5,000 Deposit when you apply to be a Creative World School franchisee. The Deposit will be credited toward the amount of the Initial Franchise Fee when you sign the Franchise Agreement. If you do not sign a Franchise Agreement within 180 days after signing the Site Assessment Deposit Agreement, then we will refund the Deposit less the greater of: (i) $2,500; or (ii) our out-of-pocket expenses for time and effort expended in reliance upon your application.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT (FDD pages 18–21)
What This Means (2025 FDD)
According to the 2025 Creative World School Franchise Disclosure Document, a $5,000 deposit may be required when applying for a franchise. This deposit is generally credited towards the initial franchise fee upon signing the Franchise Agreement.
However, the deposit's refundability is subject to specific conditions. If a Franchise Agreement is not signed within 180 days after signing the Site Assessment Deposit Agreement, Creative World School will refund the deposit, but will deduct the greater of (i) $2,500 or (ii) their out-of-pocket expenses incurred while processing the application. This clause protects Creative World School from losses incurred during the site assessment and application process if the agreement is not finalized.
Once Creative World School and the franchisee have approved a site for the school, the deposit becomes non-refundable. This condition implies that the franchisor has invested significant resources into site selection and preparation, making a refund no longer feasible after site approval. Therefore, prospective franchisees should carefully consider these conditions before paying the deposit and ensure they are committed to the franchise and site before the approval stage to avoid potential loss of the deposit.