What information must be provided to Learningrx about the proposed transferee?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
transferee's obligations;
- (h) the proposed transferee demonstrates to Franchisor's satisfaction that it, in all respects, meets Franchisor's standards applicable to new franchisees regarding experience, personal and financial reputation and stability, willingness and ability to devote his or her full time and best efforts to the operation of the franchised Business, and any other conditions as Franchisor may reasonably apply in evaluating new franchisees. Franchisor must be provided all information about the proposed transferee as it may reasonably require. Because of the confidential information available to a franchisee, no assignment to a competitor of the System will be permitted, and;
- (i) in the event the proposed transfer is the result of the introduction from a third-party broker, Franchisee or the transferee will be solely responsible for payment of such brokerage commissions, and all such commissions must be paid in full before the transfer is deemed effective by Franchisor.
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, a franchisee looking to transfer their business must provide Learningrx with all information it may reasonably require about the proposed transferee. Specifically, the proposed transferee must demonstrate to Learningrx's satisfaction that they meet the standards applicable to new franchisees. These standards include experience, personal and financial reputation and stability, willingness and ability to devote full time and effort to operating the franchised business, and any other conditions Learningrx may reasonably apply when evaluating new franchisees.
In addition, the individual proposed transferee, or the relevant parties of a proposed entity transferee (stockholders, partners, members, trustees, and beneficiaries), must execute a personal guarantee. This guarantee ensures they are jointly and severally responsible for the proposed transferee's obligations. This requirement aims to protect Learningrx by ensuring the transferee is fully committed and financially stable.
It is important to note that Learningrx prohibits any assignment to a competitor of the Learningrx system due to the confidential information available to franchisees. This restriction is in place to safeguard Learningrx's trade secrets and competitive advantage. Prospective franchisees should be prepared to provide comprehensive documentation and information about any potential transferee to ensure a smooth transfer process that meets Learningrx's requirements.