What happens if a Learningrx franchisee or employee is convicted of a felony?

According to the 2025 Learningrx Franchise Disclosure Document, a franchisee's agreement can be terminated if the franchisee, any owner of the franchisee entity, manager, or employee is convicted of a felony. This also applies to convictions of a crime involving moral turpitude, any crime or offense that is reasonably likely, in the sole opinion of Learningrx, to materially and unfavorably affect the LearningRx system, marks, goodwill, or reputation, or charged or convicted of any crime or misdemeanor involving children.

This provision gives Learningrx broad discretion to terminate the franchise agreement based on criminal convictions or charges of the franchisee, their owners, managers, or employees. The standard is not limited to felonies but extends to any crime or offense that Learningrx believes could negatively impact the LearningRx system's reputation. The inclusion of crimes involving 'moral turpitude' and any offense involving children further broadens the scope of this clause.

For a prospective Learningrx franchisee, this means that they must exercise extreme caution in their hiring practices and ensure that neither they nor their employees engage in any behavior that could lead to a criminal charge or conviction. The franchisee bears the risk of their employees' actions potentially leading to the termination of their franchise agreement. This clause highlights the importance of thorough background checks and careful monitoring of employee conduct to protect the franchise investment.

It is important to note that the FDD states that Learningrx has the sole opinion to determine if the crime or offense is likely to materially and unfavorably affect the LearningRx system, marks, goodwill, or reputation. This could be seen as a subjective standard, and a prospective franchisee should seek clarification from Learningrx regarding what specific types of offenses would trigger this clause.