Does Itan's right of first refusal apply to a Permitted Transfer?

According to Itan's 2025 Franchise Disclosure Document, Itan's right of first refusal does not apply to a Permitted Transfer. This means that if a franchisee engages in a transfer that qualifies as a 'Permitted Transfer,' Itan will not have the option to purchase the franchise interest before it is sold to another party.

However, even with a Permitted Transfer, the franchisee must still provide Itan with at least 10 days' prior notice. Additionally, if the Permitted Transfer results in a new Franchisee Entity, Itan may request that the former Franchisee Entity sign a corporate guarantee to ensure the new entity meets its financial obligations under all Definitive Agreements. The franchisee and owners must also sign all documents Itan reasonably requests to complete and document the Permitted Transfer.

This exception to the right of first refusal can be advantageous for franchisees seeking to transfer their business under specific circumstances, as it streamlines the transfer process by removing Itan's preemptive purchasing option. However, franchisees must still adhere to the notification and documentation requirements to ensure the transfer is properly executed and recognized by Itan.