What are the franchisee's obligations regarding pre-opening purchases/leases for Learningrx (Item 9) and how do these relate to the franchisor's requirements for operating the center (Item 8)?

According to Learningrx's 2025 Franchise Disclosure Document, Item 9 outlines the franchisee's obligations, including those related to pre-opening purchases and leases. Specifically, the table in Item 9 indicates that the franchisee is responsible for pre-opening purchases and leases, as detailed in Sections 10.02 and 12.6 of the Franchise Agreement, and further described in Item 11 of the Disclosure Document. Item 11 provides details regarding Learningrx's assistance before the business begins.

Specifically, Learningrx offers limited advice about selecting and analyzing a site for the Center. The franchisee's site for a Micro Center must be at least 800 square feet, and a Standard Center must be at least 1,000 square feet, unless Learningrx approves otherwise in writing before lease execution. The site must be located inside the franchisee's Territory, and the franchisee must maintain a physical location for their Center at all times. While site selection is the franchisee's responsibility, Learningrx will assist in the location selection process by considering factors such as population density, income levels, general location guidelines, and the proximity of the proposed site to other Learningrx Centers.

The franchisee is responsible for negotiating the terms and conditions of all agreements related to the purchase, lease, and alteration of the property. However, Learningrx requires the franchisee to include certain lease provisions. The costs associated with these activities can vary widely and may be significantly higher than projected, depending on factors such as property location, population density, economic climate, prevailing interest rates, the condition of the property, and the extent of alterations required. The franchisee must also maintain insurance policies covering them and LearningRx Franchise Corporation, as specified in the Operations Manual, including property insurance, general liability, and other coverages.

In summary, while Learningrx provides some assistance and sets certain standards, the franchisee bears the primary responsibility for site selection, acquisition/lease, pre-opening purchases/leases, and compliance with the standards and policies outlined in the Operations Manual. These obligations are closely tied to Learningrx's requirements for operating the center, as non-compliance can lead to termination of the Franchise Agreement.