Does the indemnification obligation of Amerispec Inspection Services survive the expiration or termination of the Franchise Agreement?
Amerispec_Inspection_Services Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE AND THE GUARANTORS, BY SIGNING THIS AGREEMENT, INDEMNIFY AND AGREE TO DEFEND AND HOLD HARMLESS THE COMPANY AND ITS RELATED PARTIES AGAINST ALL LOSSES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, LIABILITIES AND EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL EXPENSES OF LITIGATION OR PREPARATION FOR LITIGATION WHETHER OR NOT THE COMPANY IS A PARTY TO THE LITIGATION) THAT THE COMPANY OR ANY OF ITS
RELATED PARTIES MAY PAY OR INCUR ARISING OUT OF OR RELATING TO THIS AGREEMENT OR TO FRANCHISEE'S OPERATION OF THE FRANCHISED BUSINESS EVEN IF CAUSED IN WHOLE OR IN PART BY THE NEGLIGENCE (WHETHER SOLE, JOINT OR CONCURRENT), OF THE COMPANY.
- 22.3 Indemnification by Company. The Company agrees to indemnify the Franchisee against, and to reimburse the Franchisee for, any obligation or liability for damages payable to persons other than the Franchisee or its owners that are attributable to agreements, representations or warranties of the Company, or solely caused by the negligent or willful action of the Company, and for costs (as hereinabove defined) reasonably incurred by the Franchisee in the defense of any claim brought against it as a result of the foregoing or in any such action in which it is named as a party. The Company shall have the right to participate in and to control any litigation or proceeding which might result in liability of or expense to the Franchisee subject to indemnification by the Company.
- 22.4 Survival of Obligations. The indemnity and assumption of liability obligations herein shall continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement.
Source: Item 23 — Receipts (FDD pages 47–172)
What This Means (2025 FDD)
According to Amerispec Inspection Services's 2025 Franchise Disclosure Document, the indemnification obligations of both the franchisee and Amerispec Inspection Services survive the expiration or termination of the Franchise Agreement. Specifically, the franchisee agrees to indemnify, defend, and hold harmless Amerispec Inspection Services against losses, claims, damages, penalties, judgments, liabilities, and expenses arising from the agreement or the franchisee's operation, even if caused by Amerispec Inspection Services's negligence.
Conversely, Amerispec Inspection Services agrees to indemnify the franchisee against obligations or liabilities for damages payable to others, attributable to Amerispec Inspection Services's agreements, representations, warranties, or negligent/willful actions. This includes costs incurred by the franchisee in defending claims resulting from the aforementioned issues. Amerispec Inspection Services retains the right to control any litigation that could result in liability or expense for the franchisee.
This survival clause means that even after the franchise agreement ends, both parties remain responsible for any indemnification obligations that arose during the term of the agreement. This is a standard practice in franchising to ensure that liabilities and responsibilities are addressed even after the business relationship concludes. The franchisee should carefully consider the scope of these indemnification obligations and understand the potential long-term financial implications.