What is the 'Minimum MDF Payment' defined as for Learningrx Standard Franchises?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
on its Website, as set forth in Section 9.02.
9. SOLICITATION AND ADVERTISING
- 9.1 Solicitation. Except as stated in this paragraph, Franchisee may not directly market to or solicit customers who reside outside the Territory. However, Franchisee will have the exclusive right to service customers within the Territory generated by Multi-Area Marketing Programs except through the Internet.
- 9.2 Marketing Development Fund. Franchisee must pay a fee into the Marketing Development Fund to develop marketing for the System. Franchisee will pay a Marketing Development Fund contribution equal to the greater of either (i) three percent (3%) per month of Franchisee's Gross Revenue, or, the "Minimum MDF Payment" of Two hundred and 00/100 Dollars ($200.00) for Micro Franchises and Three hundred and 00/100 Dollars ($300.00) for Standard Franchises, up to a maximum of Fifteen thousand and 00/100 Dollars ($15,000.00) per calendar year per Center, at the same time and in the same manner as the Royalty Fee. Company and Affiliate owned Centers will contribute to the Fund on the same basis as Franchisees. Franchisor will hold the Marketing Development Fund contributions in a separate bank account. Franchisor will use the Marketing Development Fund for development expenses such as the creation of marketing and sales tools for centers, development and maintenance of websites and Internet marketing, creating Pay-Per-Click campaigns, various digital marketing campaigns, other campaigns Centers can opt into, social media campaigns, media production, public relations, efforts to publish research studies, agency costs and other costs for resources or tools for developing marketing for use by Centers. This may include our attendance at trade shows, and
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, franchisees are required to contribute to a Marketing Development Fund (MDF). The purpose of this fund is to develop marketing strategies and materials for the Learningrx system as a whole.
For a Learningrx Standard Franchise, the 'Minimum MDF Payment' is defined as $300.00 per month. However, the franchisee is obligated to pay the greater of either 3% of their monthly Gross Revenue or the minimum MDF payment of $300.00. The contribution to the Marketing Development Fund is capped at a maximum of $15,000.00 per calendar year for each Learningrx center.
The funds collected are used at Learningrx's discretion for various marketing initiatives, which may include creating marketing and sales tools, website development, internet marketing campaigns, social media, public relations, and research studies. It's important to note that the FDD states that Learningrx has no fiduciary duty with respect to the fund, and expenditures may not be directly proportional to a franchisee's contributions or provide a direct benefit to each individual franchisee.