Is a Learningrx Spousal Affiliate allowed to perform services for a Competitive Business without the Franchisor's approval?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
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- In order to protect the goodwill and unique qualities of the System and the confidentiality and value of the Trade Secrets, and in consideration for the disclosure to Spousal Affiliate of the Trade Secrets, Spousal Affiliate further agrees and covenants that Spousal Affiliate will not without the prior written consent of Franchisor:
- a. Have any direct or indirect interest as a disclosed or beneficial owner in a Competitive Business, except with Franchisor's approval;
- b. Perform services as a director, officer, manager, employee, consultant, representative, agent or otherwise for a Competitive Business wherever operating except with Franchisor's approval;
- c. Employ, or seek to employ, any person who is at the time or was within the preceding 180 days employed by Franchisor, any of its affiliates or any of its franchisees, or otherwise directly or indirectly induce such person to leave that person's employment; or
- d. Divert or attempt to divert, directly or indirectly, any business, business opportunity or customer of the LearningRx Business to any competitor;
- e. Make any disparaging remarks, or otherwise take any action or do anything that could reasonably be anticipated to cause loss or damage to the business or business opportunities, affairs, reputation and goodwill of, or otherwise negatively reflect upon, Franchisor, the System or the Licensed Marks; and
The term "Competitive Business" as used in this Agreement will mean any business offering or granting franchises or licenses to others to provide: (i) learning enhancement courses, programs or products; (ii) brain training or cognitive training courses, programs or products; or (iii) math and reading training courses, programs, or products.
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, a Spousal Affiliate is restricted from performing services for a Competitive Business without prior written consent from Learningrx. Specifically, the Spousal Affiliate cannot act as a director, officer, manager, employee, consultant, representative, or agent for a Competitive Business unless Learningrx approves it in writing. This restriction applies regardless of where the Competitive Business operates. The term "Competitive Business" includes businesses that offer or franchise learning enhancement, brain training, or math and reading training courses, programs, or products.
This requirement is part of a broader set of covenants not to compete designed to protect Learningrx's goodwill, unique system, and trade secrets. These covenants also prevent the Spousal Affiliate from having a direct or indirect interest in a Competitive Business without approval, diverting business or customers to a competitor, or disparaging Learningrx. These restrictions are in place to ensure that individuals associated with the Learningrx franchise do not use confidential information or their position to benefit competing businesses.
The non-compete obligations extend both during the Spousal Affiliate's association with the Learningrx franchisee and for a period after their association ends. This post-term restriction lasts for two years following the termination of the Spousal Affiliate's relationship with the franchisee. During this period, the restrictions apply within the franchisee's territory, adjacent counties, areas under development by Learningrx or its franchisees, and within a fifty-mile radius of any Learningrx Training Center. The restrictions also apply to online activities and multi-area marketing channels used by Learningrx.
Prospective franchisees should carefully consider these restrictions and ensure that their Spousal Affiliates understand and are willing to comply with these obligations. Failure to obtain prior written consent from Learningrx before engaging in activities with a Competitive Business could result in a breach of the franchise agreement and potential legal consequences.