Is ATFC's negligence a factor in the All Team USER's indemnification obligation?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
USER will indemnify, defend and save harmless ATFC and its employees, agents, officers, directors, parents, subsidiaries, affiliates, successors and assigns ("Indemnitees") from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, costs and expenses (including without limitation legal fees and expenses) of any kind and nature whatsoever, including without limitation damages or injuries suffered by Indemnitees, which may be imposed on, incurred by or asserted against the Indemnitees in any way arising out of the acts or omissions of USER or its employees, agents, officers, directors, parents, subsidiaries, affiliates, successors and assigns ("Indemnitors") pursuant to or relating to this Agreement or the transactions or relationships contemplated hereby or a breach or default by USER under this Agreement regardless of whether the Indemnities were negligent or that said negligence was a contributing factor in the liability.
Source: Item 23 — RECEIPT (FDD pages 34–161)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the USER's indemnification obligation extends to situations where ATFC (All Team Franchise Corporation) was negligent. The agreement stipulates that the USER will indemnify, defend, and hold harmless ATFC and its related parties from any liabilities, losses, damages, penalties, claims, actions, costs, and expenses arising from the acts or omissions of the USER, regardless of whether ATFC was negligent or if such negligence contributed to the liability.
This means that even if ATFC's own negligence plays a role in a claim or loss, the USER is still responsible for covering ATFC's costs and damages. This is a significant obligation for the USER, as it potentially exposes them to liability even when ATFC is partly at fault.
This type of indemnification clause is not uncommon in franchise agreements, but prospective All Team franchisees should carefully consider the scope of this obligation and its potential financial impact. It is advisable to consult with a legal professional to fully understand the implications of this clause and to assess the risks involved.