What must an Itan franchisee do if they develop an Improvement?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Improvements. You agree to assign to us or our designee, without charge, all rights to any Improvement developed by you, including the right to grant sublicenses. If applicable law precludes you from assigning ownership of any Improvement to us, then such Improvement shall be perpetually licensed by you to us free of charge, with full rights to use, commercialize and sublicense the same.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, if a franchisee employee or independent contractor develops an Improvement, the franchisee must assign all rights to Itan or its designee without any charge. An "Improvement" is defined as any idea, addition, modification, or improvement to various aspects of the salon, including goods, services, operational methods, processes, marketing materials, or intellectual property, whether developed by the franchisee, Itan, or any other person.
If applicable law prevents the franchisee from assigning ownership of the Improvement to Itan, the franchisee must perpetually license the Improvement to Itan free of charge. This license grants Itan full rights to use, commercialize, and sublicense the Improvement. This ensures that Itan can leverage any advancements or innovations made within the franchise system for the benefit of the entire network.
This requirement is fairly standard in franchising, as franchisors typically want to maintain control over any enhancements to their system. By assigning or licensing Improvements to Itan, the franchisee ensures that Itan can protect and utilize these advancements across all locations, maintaining consistency and quality throughout the Itan franchise system. This also allows Itan to update the Manual and System with new innovations.