factual

How many monthly royalty payments must a Learningrx franchisee pay for both the Center and the Satellite Location?

Learningrx Franchise · 2025 FDD

Answer from 2025 FDD Document

The Gross Revenues for the Satellite Location shall be added to the Gross Revenues of Franchisee's Center to determine the Royalties owed to Franchisor each month.

Therefore, Franchisee must pay to Franchisor one (1) monthly royalty for both the Center granted to it under the Franchise Agreement and the Satellite Location granted to it under this Addendum, of the greater of either (i) eight percent (8%) of the combined Gross Revenues for its Center and its Satellite Location, or (ii) the Minimum Monthly Royalty, as defined in the Franchise Agreement.

Source: Item 23 — RECEIPT (FDD pages 54–209)

What This Means (2025 FDD)

According to Learningrx's 2025 Franchise Disclosure Document, a franchisee is required to make one monthly royalty payment that combines the gross revenues from both their main Learningrx center and any satellite location they operate. This single monthly royalty payment is calculated as the greater of either 8% of the combined gross revenues from the center and satellite location, or the Minimum Monthly Royalty as defined in the Franchise Agreement.

This means that Learningrx franchisees with a satellite location do not pay separate royalties for each location. Instead, the revenue from both locations is combined for royalty calculation purposes. This could simplify the payment process for franchisees and potentially reduce the overall royalty burden if the minimum monthly royalty is not exceeded.

However, it's important for prospective Learningrx franchisees to carefully review the definition of "Gross Revenue" in the Franchise Agreement to fully understand what receipts are included in the royalty calculation. Additionally, franchisees should be aware of the Minimum Monthly Royalty and how it might impact their royalty payments, especially during periods of lower revenue at either the main center or the satellite location.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.