What evidence of compliance must an Itan franchisee provide after termination, expiration, or transfer?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
- 24.11.Survival.
All provisions that expressly or by their nature survive the termination, expiration or Transfer of this Agreement, or the Transfer of an ownership interest in the Salon or Franchisee Entity, shall continue in full force and effect subsequent to and notwithstanding its termination, expiration or Transfer and until they are satisfied in full or by their nature expire, including, without limitation, §13, §14, §16, §18, §21, §22 and §24.
- **19.5.
Our Right of First Refusal.** If you or an Owner wish to engage in a Transfer, you or the Owner, as applicable, must obtain and send us a bona-fide offer executed by the purchaser after completion of due diligence.
(j) you and your Owners sign a General Release;
(k) you agree to subordinate the transferee's financial obligations to you to the transferee's financial obligations owed to us pursuant to the franchise agreement (we may require you to enter into a written subordination agreement);
(l) we choose not to exercise our right of first refusal described in §19.5; and
(m) you or the transferring Owner, as applicable, and the transferee satisfy all other conditions we reasonably require as a condition to approval of the Transfer.
Our consent to a Transfer shall not constitute a waiver of any Claims we have against the transferor or our right to demand the transferee comply with all terms of the franchise agreement.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, several sections of the franchise agreement survive the termination, expiration, or transfer of the agreement. These include sections 13, 14, 16, 18, 21, 22, and 24. These sections remain in full effect until they are completely satisfied or naturally expire.
Specifically regarding transfers, if a franchisee or owner wishes to transfer their Itan franchise, they must obtain a bona-fide offer executed by the purchaser after due diligence and send it to Itan. Additionally, in the event of a transfer, the franchisee and their owners must sign a General Release. They must also agree to subordinate the transferee's financial obligations to the obligations owed to Itan under the franchise agreement, potentially requiring a written subordination agreement.
Furthermore, Itan retains the right of first refusal, and the franchisee or transferring owner, along with the transferee, must meet any other conditions Itan reasonably requires for approval of the transfer. It is important to note that Itan's consent to a transfer does not waive any claims they may have against the transferor, nor does it negate the transferee's obligation to comply with all terms of the franchise agreement. These measures ensure that Itan maintains control over who operates under their brand and that all obligations are met even after a transfer.