Does the Itan agreement apply to 'Owners' in addition to the Franchisee?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
This Franchise Owner Agreement (this "Agreement") is entered into by: (a) each of the undersigned Owners of Franchisee (defined below); and (b) the spouse of each such Owner who is a natural Person, in favor of iTAN Franchising, Inc., a California corporation, and its successors and assigns ("us"). Each signatory to this Agreement is referred to as "you".
1. DEFINITIONS. Capitalized terms not defined above have the meanings given to them below, or if not defined below, the meanings given to them in the Franchise Agreement:
- "Owner" means a Person who either: (a) directly signs this Agreement as the franchisee, either alone or in conjunction with one or more other Persons; or (b) directly or indirectly through one or more intermediaries owns an Equity Interest in the Business or Franchisee Entity.
- Representations and Warranties. You and Owner each represent and warrant that: (a) [Insert franchisee entity name] is duly authorized to execute this Agreement and perform its obligations hereunder; (b) neither you nor Owner has assigned, transferred or conveyed, either voluntarily or by operation of law, any of their rights or claims against any of the Franchisor Parties or any of the rights, claims or obligations being terminated or released hereunder; (c) you and Owner have not and shall not (i) institute or cause to be instituted against any of the Franchisor Parties any legal proceeding of any kind, including the filing of any claim or complaint with any state or federal court or regulatory agency, alleging any violation of common law, statute, regulation or public policy premised upon any legal theory or claim whatsoever relating to the matters released in this Agreement or (ii) make any verbal, written or other communication that could reasonably be expected to damage or adversely impact any Franchisor Party's reputation or goodwill; and (d) the individuals identified as Owners on the signature pages hereto together hold 100% of the legal and beneficial ownership interests in [Insert franchisee entity name].
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the agreements extend beyond just the franchisee to include 'Owners.' The Franchise Owner Agreement explicitly states that it is entered into by each of the undersigned Owners of the Franchisee. The agreement also includes the spouse of each Owner who is a natural person, thereby extending the obligations and benefits to them as well. Each signatory to the agreement is referred to as 'you.'
Itan defines 'Owner' as a person who either directly signs the agreement as the franchisee, alone or with others, or indirectly owns an equity interest in the business or franchisee entity through one or more intermediaries. This broad definition ensures that all individuals with a significant stake in the Itan franchise are bound by the terms of the Franchise Owner Agreement.
Furthermore, the document includes representations and warranties that 'you and Owner each represent and warrant,' indicating shared responsibilities and liabilities. For example, both the franchisee and the owner must warrant that they have not assigned any rights against the Franchisor Parties and will not institute any legal proceedings against them. This shared responsibility underscores the importance of all Owners being fully aware of and compliant with the franchise agreement's terms.
In practical terms, this means that anyone considering investing in an Itan franchise, either as a direct franchisee or as an owner of the franchisee entity, must carefully review and understand the Franchise Owner Agreement. Their actions and financial interests will be directly affected by the terms outlined in the agreement, and they will be held accountable for compliance alongside the franchisee.