What obligations does a Learningrx franchisee have upon termination or non-renewal of the agreement, as outlined in Sections 9.02?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Area Developer Agreement | Summary | |
|---|---|---|---|
| i. | Franchisee's obligations on termination/nonrenewal | Sections 9.02 | Obligations include complete de-identification, non-competition and payment of amounts due. |
| r. | Non-competition covenants after the franchise is terminated or expires | Section 9.02 | Except as restricted by applicable state law, no involvement in competing business for 2 years within Development Territory, within adjacent counties, 50 miles from Development Territory or another LearningRx Area Developer or LearningRx Training Center, on the internet or other Multi-Area marketing channels |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, Section 9.02 outlines the obligations of an Area Developer upon termination or non-renewal of the agreement. These obligations include complete de-identification, which means removing all Learningrx branding and trademarks from the business location and materials. Additionally, the franchisee is subject to non-competition covenants, restricting their involvement in any competing business. Finally, the franchisee is responsible for the payment of any outstanding amounts due to Learningrx.
Specifically, the non-competition covenant restricts involvement in a competing business for two years after termination or expiration. This restriction applies within the Development Territory, adjacent counties, or within 50 miles of the Development Territory. It also includes restrictions related to other LearningRx Area Developers or LearningRx Training Centers, as well as online or multi-area marketing channels. These restrictions may be subject to applicable state laws.
These obligations are fairly standard in franchising to protect the brand and prevent unfair competition. Prospective Learningrx franchisees should carefully consider these post-termination obligations, especially the non-compete clause, to understand how it might affect their future business opportunities after leaving the Learningrx system. It is important to consult with a legal professional to fully understand the implications of these clauses in their specific state.