Must the Itan franchisee and Owners sign a General Release for a Transfer to be approved?

According to Itan's 2025 Franchise Disclosure Document, a General Release is required from both the franchisee and their Owners as part of the transfer approval process. Specifically, if a franchisee wishes to transfer their franchise to a new owner, Itan will not unreasonably withhold approval if certain conditions are met. One of these conditions is that the franchisee and their Owners must sign a General Release.

The General Release serves to release Itan from any claims, liabilities, or damages related to the franchise agreement or the transfer itself. This is a common practice in franchising to protect the franchisor from potential future legal issues arising from the former franchisee's operation or the transfer process. The General Release includes a release of all claims against Itan and its affiliates from the franchisee and their associated parties.

It is important to note that the General Release may have specific clauses depending on the franchisee's location. For example, the document mentions specific clauses for California and Washington franchisees related to the waiver of certain legal protections and franchise laws. Prospective Itan franchisees should carefully review the General Release with legal counsel to understand the full scope of the claims they are waiving and the implications of signing such a release.