What is included in the definition of 'claims' for indemnification purposes related to Bananas Smoothies Frozen Yogurt?
Bananas_Smoothies_Frozen_Yogurt Franchise · 2025 FDDAnswer from 2025 FDD Document
rmless from and against and to reimburse them for all claims, obligations and damages described in this Section, any and all taxes described in Paragraph 12.3 of Section 12 of this Agreement and any and all claims and liabilities directly or indirectly arising out of the operation of Developer's business (even if Franchisor's negligence is alleged, but not proven), Developer's breach of this Agreement or Developer's use of the Marks in any manner not in accordance with this Agreement. For purposes of this indemnification, "claims" means and includes all obligations, damages (actual, consequential or otherwise) and costs reasonably incurred in the defense of any claim against any of the Indemnified Parties including, without limitation, reasonable costs, other expenses of litigation, attorney fees, arbitration or alternative dispute resolution and travel and living expenses.
Source: Item 23 — RECEIPT (FDD pages 58–231)
What This Means (2025 FDD)
According to the 2025 FDD, the definition of "claims" for indemnification purposes related to Bananas Smoothies Frozen Yogurt includes all obligations, damages, and costs reasonably incurred in defending against any claim against the Indemnified Parties. This encompasses actual and consequential damages.
Specifically, the definition extends to reasonable costs, litigation expenses, attorney fees, arbitration or alternative dispute resolution costs, and travel and living expenses. This means that if a franchisee's actions lead to a claim against Bananas Smoothies Frozen Yogurt or its affiliates, the franchisee could be responsible for covering all associated costs, including legal representation and any resulting damages.
This indemnification clause is designed to protect Bananas Smoothies Frozen Yogurt from liabilities arising from the franchisee's operation of the business. It is important for prospective franchisees to understand the scope of this clause and to ensure they have adequate insurance coverage and risk management strategies in place to mitigate potential liabilities. The FDD also states that Bananas Smoothies Frozen Yogurt has the right to defend any claim against them as they see fit and are not required to seek recovery from any insurer or third party.