Under what conditions will Learningrx not franchise or license others in the development territory?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
During the term of this Agreement and any extensions, neither Franchisor nor its affiliates will own, operate or franchise a fixed location for the operation of any other Center within your Territory as designated in Attachment I to this Agreement.
Franchisee will also have the right to service any persons in the Territory, regardless of the method of sales, subject to Franchisor's express reservation of rights set forth in Section 4.5.
Once established, the boundaries of Franchisee's Territory will not be adjusted by Franchisee without Franchisor's written consent regardless of whether the population of Franchisee's Territory increases or decreases over time.
Notwithstanding the foregoing, Franchisee acknowledges that prior to the term of this Agreement, Franchisor or its affiliate may have licensed to a third-party the right to use the System and/or Marks to operate a business that may be similar to the LearningRx Center operated by Franchisee under this Agreement pursuant to a PACE license or a Clinical license in a portion of Franchisee's Territory.
The pre-existing PACE licensee and/or Clinical licensee has the right to continue to operate the business per the PACE license and/or Clinical license in the portion of Franchisee's Territory and such ongoing use will not constitute a breach of this Agreement, including this Section 4.02 or an Area Developer Agreement, if any.
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to the 2025 Learningrx Franchise Disclosure Document, Learningrx grants franchisees a territory where neither Learningrx nor its affiliates will operate or franchise a fixed location for another Learningrx center. However, this is subject to certain pre-existing agreements.
Specifically, Learningrx or its affiliates may have previously licensed a third party to operate a similar business under a PACE or Clinical license within the franchisee's territory before the current agreement. These pre-existing licensees retain the right to continue operating their businesses, and this operation does not constitute a breach of the current franchise agreement. This means a Learningrx franchisee might find a similar, pre-existing business already operating within their designated territory.
Learningrx also retains several rights within the franchisee's territory. These include the right to use and franchise trademarks other than the Learningrx marks, offer services or products through alternative channels of distribution (excluding "trainer to student" products), market on the internet, and acquire similar businesses within the territory. These reservations mean that while Learningrx grants a territory, it retains significant control and the ability to operate or license others in ways that could potentially compete with the franchisee's Learningrx center.