Under what circumstances is the sale of Salon assets NOT considered a 'Transfer' for an Itan franchise?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
ng, security or improvement of these systems.
"Transfer" means a transfer or assignment of: (a) the Franchise Agreement or ADA (or any interest in either such agreement); (b) the Salon's assets (other than the sale of fixtures or equipment in the ordinary course of business); (c) any ownership interest in the entity that is the "franchisee" or "area developer"; or (d) the franchised business you conduct under the Franchise Agreement or ADA.
"Travel Expenses" means all travel, meals, lodging, local transportation and other living expenses incurred: (a) by us and our trainers, field support personnel, auditors or other representatives to visit your Salon; or (b) by you or your personnel to attend training programs or conferences.
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- CPI Adjustments: All fees expressed as a fixed dollar amount are subject to adjustment based on changes to the U.S. Consumer Price Index (CPI).
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the sale of salon assets is generally considered a 'Transfer,' but there is a specific exception. The sale of fixtures or equipment in the ordinary course of business is excluded from the definition of a 'Transfer'.
This means that an Itan franchisee can sell typical salon fixtures and equipment as part of their regular business operations without it being classified as a transfer of the franchise agreement or the salon's assets. This provides some flexibility for franchisees to manage and update their salon's equipment without needing to seek franchisor approval for a 'Transfer,' which would likely involve fees and other requirements.
However, it is important to note that this exception is limited to sales made in the 'ordinary course of business.' Any sale of assets outside of this normal operational context would likely be considered a transfer, requiring franchisor consent and potentially triggering transfer fees. Franchisees should consult with Itan to clarify what constitutes the 'ordinary course of business' to ensure compliance with the franchise agreement.