Does the definition of 'Owner' in the Itan agreement include someone who indirectly owns an Equity Interest?

According to Itan's 2025 Franchise Disclosure Document, the definition of "Owner" includes individuals who directly or indirectly own an Equity Interest in the Development Business or Developer Entity. Specifically, the FDD states that an "Owner" means a person who directly or indirectly through one or more intermediaries owns an Equity Interest in the Development Business or Developer Entity. This definition extends to those who sign the Area Development Agreement directly or a Franchise Agreement as the franchisee.

This definition has significant implications for prospective Itan franchisees. It means that not only direct owners but also those with indirect ownership, even through multiple layers of intermediaries, are considered "Owners" under the agreement. This is a broad definition that captures a wide range of ownership structures.

For example, if a franchisee sets up a holding company that owns the franchise entity, the individuals who own the holding company would also be considered "Owners." This is important because "Owners" are typically required to sign a Franchise Owner Agreement and may be subject to certain obligations and restrictions under the franchise agreement, such as post-term non-compete clauses. Therefore, prospective franchisees need to be aware of this broad definition and understand who will be considered an "Owner" in their particular ownership structure.

It is also important to note that the definition of "Equity Interest" itself includes both direct and indirect ownership or beneficial interest in the capital stock, partnership, or membership interest in a business or entity, including voting rights. This further clarifies that indirect ownership extends to various forms of beneficial interests and voting rights, ensuring comprehensive coverage of different ownership arrangements.