What is the 'Development Fee' that an Itan developer must pay upon execution of the Development Agreement?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
- 6. DEVELOPMENT FEE. Upon execution of this Agreement, you must pay us a development fee (the "Development Fee") in the amount set forth in Part B of ATTACHMENT "A". The Development Fee is calculated as the sum of the initial franchise fees applicable to all Required Salons listed in the Development Schedule. The Development Fee, and the initial franchise fees for the Required Salons comprised by the Development Fee, are fully earned and nonrefundable upon receipt.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, a development fee is required upon execution of the Area Development Agreement. The amount of the Development Fee is detailed in Part B of ATTACHMENT "A" of the agreement. This fee is calculated by summing the initial franchise fees for all Required Salons listed in the Development Schedule. Once paid, the Development Fee, along with the initial franchise fees for the Required Salons, are considered fully earned and nonrefundable by Itan.
In simpler terms, if you plan to develop multiple Itan salons in a specific area, you'll need to pay a development fee upfront. This fee essentially covers the initial franchise fees for each of the salons you're obligated to open under the development agreement. The specific amount will depend on how many salons you commit to developing.
Prospective Itan developers should carefully review Part B of ATTACHMENT "A" to understand the exact Development Fee amount. Since the Development Fee is nonrefundable, it's crucial to fully understand the development obligations and schedule before signing the agreement and paying the fee. This is a standard practice in area development franchise agreements, where developers pay upfront for the rights to develop multiple units.