What are the names of the related parties under common control of Itan's owner?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
mpanies share common expenses. The Company leases office space from Evolv (see note 4). The Company and the entities under common control are not parties to any arrangements in which they are liable for mutual financial support nor events that would cause the Company to report a loss beyond any amounts reported as receivables.
During the years ended December 31, 2024 and 2023, KHI paid for expenses on behalf of the Company totaling $362 and $3,030 and the Company paid for expenses on behalf of KHI totaling $0 and $69,478, respectively. For the years ended December 31, 2024 and 2023, $0 and $181, respectively, is due to KHI and is reflected in accounts payable on the balance sheets.
In addition, as of December 31, 2023, KHI owned five franchise locations. At the end of 2023, KHI sold all five franchise locations to a third party. Per the franchise agreement, KHI paid no royalty fees to the Company during the year ended December 31, 2023. Total marketing fund fees from KHI for the year ended December 31, 2023 were $96,154. KHI owes marketing fees and amounts for workers compensation insurance, supplies, and services to the Company of $0 and $6,706 for the years ended
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December 31, 2024 and 2023, respectively. These balances due from this related party are reflected in accounts receivable on the balance sheets. At December 31, 2024 and 2023, the Company had a $1,700,000 and $250,000 receivable, respectively, from KHI. This amount is a short-term loan and is reflected in due from related parties on
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, there are two related parties under common control of Itan's owner: KHI and Evolv.
Specifically, the document mentions that as of December 31, 2023, KHI owned five franchise locations, which were later sold to a third party. During 2023, KHI did not pay royalty fees to Itan, but paid $96,154 in marketing fund fees. KHI also owed Itan $0 and $6,706 for marketing fees, worker's compensation insurance, supplies, and services for the years ended December 31, 2024 and 2023, respectively. Additionally, Itan had receivables from KHI of $1,700,000 and $250,000 as short-term loans for the years ended December 31, 2024 and 2023, respectively, which did not accrue interest.
The document also states that rent paid to Evolv for the years ended December 31, 2024 and 2023 was $37,022 and $35,933, respectively. Evolv paid for expenses on behalf of Itan of $2,745 and $2,387 during those years, while Itan paid for expenses on behalf of Evolv totaling $14,887 and $19,065, respectively. There was $0 and $230 due from Evolv to Itan for the years ended December 31, 2024 and 2023, respectively, and $27 and $89 due to Evolv from Itan for the same periods.