Does the obligation of an Apricot Lane franchisee to indemnify the franchisor survive the termination or expiration of the Franchise Agreement?
Apricot_Lane Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE shall defend at its own cost and indemnify and hold harmless FRANCHISOR and FRANCHISOR's shareholders, directors, officers, employees and agents, from and against any and all loss, costs, expenses (including, without limitation, reasonable accountants', attorneys' and expert witness fees, costs of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses), damages, causes of action, demands and liabilities, however caused, resulting directly or indirectly from any acts or omissions of FRANCHISEE or its agents, representatives, employees or contractors, including but not limited to those from or pertaining to the construction or operation of the Franchised Business, the use of the Marks by FRANCHISEE or any breach of this Agreement by FRANCHISEE unless such damages or liabilities were proximately caused by the negligence or unlawful conduct of FRANCHISOR. All such indemnification obligations shall survive termination or expiration of this Agreement for any reason.
Source: Item 23 — RECEIPTS (FDD pages 51–222)
What This Means (2025 FDD)
According to Apricot Lane's 2025 Franchise Disclosure Document, the franchisee's obligation to indemnify the franchisor does indeed survive the termination or expiration of the Franchise Agreement. This means that even after the agreement ends, the franchisee remains responsible for covering certain losses, costs, and expenses incurred by Apricot Lane due to the franchisee's actions or omissions. This survival clause ensures that Apricot Lane is protected from potential liabilities arising from the franchisee's conduct during the term of the agreement, even after the franchise relationship has ended.
The franchisee is required to defend and hold Apricot Lane harmless from any losses, costs, expenses, damages, causes of action, demands, and liabilities resulting from their actions or omissions. These include those related to the construction or operation of the franchised business, the use of Apricot Lane's marks, or any breach of the Franchise Agreement. The only exception is if the damages or liabilities were directly caused by the negligence or unlawful conduct of Apricot Lane itself.
This indemnification clause is a standard provision in franchise agreements, designed to protect the franchisor from potential liabilities arising from the franchisee's operations. Prospective Apricot Lane franchisees should carefully consider the scope of this indemnification obligation and understand that it extends beyond the term of the agreement. It is advisable to consult with legal counsel to fully understand the implications of this clause and to assess the potential risks associated with it.