Are there any exceptions to the Transfer Fee for a Learningrx franchise?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
goodwill or brand under any other agreement with Franchisor at the time Franchisee requests permission to transfer the Business or at the time of the transfer;
- (b) Franchisee has settled all outstanding accounts with Franchisor, and Franchisee, and every principal of Franchisee's entity, have executed a general release of Franchisor and all principals of Franchisor from all claims that may be brought by you or any principal;
- (c) the proposed transferee pays Franchisor a fee to transfer the Business ("Transfer Fee") in the amount of Ten Thousand and 00/100 Dollars ($10,000.00), unless the transferee is: (i) a corporation, partnership, or limited liability company of which Franchisee is the majority stockholder, or a child, parent, sibling or spouse of Franchisee, in which case no Transfer Fee will be required, or (ii) another franchisee of LearningRx, in which case the Transfer Fee will be Five Thousand and 00/100 Dollars ($5,000.00). The Transfer Fee is fully earned upon payment and is non-refundable under any circumstances;
- (d) the proposed transferee executes a separate franchise agreement with Franchisor, using the then-current form of franchise agreement;
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, there are specific instances where the transfer fee is waived or reduced. Typically, a Learningrx franchisee must pay a $10,000 transfer fee to the Franchisor when transferring the business. However, this fee is waived entirely if the transfer is to a corporation, partnership, or limited liability company where the franchisee holds a majority stake, or to a child, parent, sibling, or spouse of the franchisee.
There is also a reduced transfer fee for Learningrx franchisees. If the Learningrx center is transferred to another existing Learningrx franchisee, the transfer fee is reduced to $5,000.
These exceptions can significantly impact the financial planning of a Learningrx franchisee, especially when considering succession or business restructuring. It's important to note that even when the transfer fee is waived, other conditions such as settling outstanding accounts, executing a general release, and the transferee meeting training requirements still apply.