What is the impact of the State Addendum on the Itan FDD?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
MENTAL AGREEMENTS AND FRANCHISE DISCLOSURE DOCUMENT FOR CERTAIN STATES**
BACKGROUND AND PURPOSE
The following modifications are made to the iTAN Franchise Disclosure Document ("FDD" or "Disclosure Document") issued by iTAN Franchising, Inc. ("we" or "us" or "franchisor") to franchisee ("you" or "franchisee") and may supersede certain portions of the Franchise Agreement between you and us dated _________________________, 202__ (the "Franchise Agreement"). When the term "Supplemental Agreements" is used, it means any area development agreement, area representative agreement, master franchise agreement, or similar agreement entered into between us and you, if applicable.
Certain states have laws governing the franchise relationship and franchise documents. Certain states require modifications to the FDD, Franchise Agreement, Supplemental Agreements and other documents related to the sale of a franchise. This State-Specific Addendum ("State Addendum") will modify these agreements to comply with the applicable state's laws. The terms of this State Addendum will only apply if you meet the requirements of the applicable state independently of your signing of this State Addendum. The terms of this State Addendum (but only the State Addendum for the applicable State) will override any inconsistent provision of the FDD, Franchise Agreement or any Supplemental Documents. This State Addendum only applies to the following states: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin.
If your state requires these modifications, you will sign this State Addendum along with the Franchise Agreement and any Supplemental Agreements. If you sign this State Addendum, only the terms applicable to the state or states whose franchise laws apply to your transaction will govern. If you sign this State Addendum, but none of the state franchise laws listed above applies because their jurisdictional requirements have not been met, then this State Addendum will be void and inapplicable to you.
CALIFORNIA
-
- The California Franchise Investment Law requires a copy of all proposed agreements relating to the sale of the Franchise be delivered together with the Disclosure Document.
-
- Section 31125 of the California Corporations Code requires us to give you a disclosure document, in a form containing the information that the Commissioner may by rule or order require, before a solicitation of a proposed material modification of an existing franchise.
-
- Neither the franchisor nor any person or franchise broker in Item 2 of the FDD is subject to any currently effective order of any national securities association or national securities exchange, as defined in the Securities Exchange Act of 1934, 15 U.S.C.A. 78a et seq., suspending or expelling such persons from membership in such association or exchange.
-
- The earnings claims figures do not reflect the costs of sales, operating expenses, or other costs or expenses that must be deducted from the gross revenue or gross sales figures to obtain your net income or profit.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to the 2025 Itan Franchise Disclosure Document, certain states have laws that govern the franchise relationship and franchise documents, which may require modifications to the FDD, Franchise Agreement, Supplemental Agreements, and other related documents. To address these requirements, Itan includes a State-Specific Addendum ("State Addendum") that modifies these agreements to comply with applicable state laws. The terms of the State Addendum will only apply if the franchisee meets the requirements of the applicable state, independent of signing the addendum. The State Addendum terms for the applicable state will override any inconsistent provision of the FDD, Franchise Agreement, or any Supplemental Documents.
The State Addendum applies specifically to California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If a franchisee's state requires these modifications, they will sign the State Addendum along with the Franchise Agreement and any Supplemental Agreements. However, if none of the listed state franchise laws apply because their jurisdictional requirements haven't been met, the State Addendum will be void and inapplicable.
For example, in Illinois, the Disclosure Document, Franchise Agreement, and Supplemental Agreements are amended to comply with the Illinois Franchise Disclosure Act. Illinois law governs the Franchise Agreement and Supplemental Agreements, and any provision designating jurisdiction and venue outside of Illinois is void, although arbitration may occur outside the state. The franchisee's rights upon termination and non-renewal are as set forth in the Illinois Franchise Disclosure Act, and any condition requiring waiver of compliance with Illinois franchise law is void. To the extent any provision in the Illinois State Addendum is inconsistent with the Franchise Agreement, the Addendum provision controls. Similar amendments are made for Indiana to comply with the Indiana Franchise Disclosure Law.