Is the Learningrx Transfer Fee refundable?
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
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, the Transfer Fee is generally non-refundable. Specifically, the FDD states that the Transfer Fee is fully earned upon payment and is non-refundable under any circumstances. The amount of the Transfer Fee is $10,000, unless the transferee is a current Learningrx franchisee, in which case the Transfer Fee is $5,000.
This means that if a Learningrx franchisee decides to sell their franchise to a third party, they will be required to pay Learningrx a Transfer Fee. Once this fee is paid, it will not be refunded, regardless of whether the transfer is completed or not. This is a standard practice in franchising, as the franchisor incurs costs in connection with the transfer, such as reviewing the transferee's qualifications and providing training.
However, the Learningrx FDD notes some exceptions where a transfer fee is not required. No Transfer Fee is required if the transfer is to a corporation where the franchisee is the majority stockholder, or to the franchisee's child, parent, sibling, or spouse, provided Learningrx approves the transfer. These situations typically involve transfers within the franchisee's existing business structure or family, so Learningrx waives the fee.
Prospective Learningrx franchisees should carefully consider the implications of the non-refundable Transfer Fee. If they anticipate selling their franchise in the future, they should factor this cost into their financial planning. They should also be aware of the limited circumstances in which the Transfer Fee may be waived.