Is the Developer required to indemnify the Baya Bar Franchisor under the agreement?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
ation of the terms of the covenants not to compete set forth in this Agreement.
- 8.7 No Defense. Developer expressly agrees that the existence of any claims he or she may have against Franchisor, whether or not arising from this Agreement, shall not constitute a defense to the enforcement by Franchisor of the covenants in this Section.
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- INDEMNIFICATION. TO THE FULLEST EXTENT PERMITTED BY LAW. DEVELOPER AGREES TO EXONERATE AND INDEMNIFY AND HOLD HARMLESS BAYA BAR FRANCHISE SYSTEMS, LLC, BAYA BAR, LLC, AND ANY OF THE ABOVE'S PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES, AS WELL AS THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES (COLLECTIVELY REFERRED TO AS THE "BAYA BAR INDEMNITEES"). FROM ALL CLAIMS BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATED TO THE DEVELOPMENT, OPERATION, CONDITION, OR ANY PART OF ANY OF DEVELOPER'S BAYA BAR OUTLETS TO BE DEVELOPED HEREUNDER, THE PRODUCTS, THE PREMISES, OR ANY ASPECT OF THE REAL ESTATE CONNECTED TO ANY OF SUCH BAYA BAR OUTLETS, WHETHER CAUSED BY DEVELOPER'S AGENTS OR EMPLOYEES, OR ARISING FROM DEVELOPER'S ADVERTISING OR BUSINESS PRACTICES. DEVELOPER AGREES TO PAY FOR ALL THE BAYA BAR INDEMNITEES' LOSSES, EXPENSES (INCLUDING, BUT NOT LIMITED TO ATTORNEYS' FEES) OR CONCURRENT OR CONTRIBUTING LIABILITY INCURRED IN CONNECTION WITH ANY ACTION, SUIT, PROCEEDING, INQUIRY (REGARDLESS OF WHETHER THE SAME IS REDUCED TO JUDGMENT OR DETERMINATION), OR ANY SETTLEMENT THEREOF FOR THE INDEMNIFICATION GRANTED BY DEVELOPER HEREUNDER. THE BAYA BAR INDEMNITEES SHALL HAVE THE RIGHT TO SELECT AND APPOINT INDEPENDENT COUNSEL TO REPRESENT ANY OF THE BAYA BAR INDEMNITEES IN ANY ACTION OR PROCEEDING COVERED BY THIS INDEMNITY. DEVELOPER AGREES THAT TO HOLD THE BAYA BAR INDEMNITEES HARMLESS, DEVELOPER WILL REIMBURSE THE BAYA BAR INDEMNITEES AS THE COSTS AND EXPENSES ARE INCURRED BY THE BAYA BAR INDEMNITEES.
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10. DISPUTE RESOLUTION
- 10.1 Internal Dispute Resolution. Developer shall first bring any claim, controversy or dispute arising out of or relating to this Agreement, the Exhibits hereto or the relationship created by this Agreement to Franchisor's president and/or chief executive officer for resolution. After providing notice as set forth in Section 12.7 below. Developer must exhaust this internal dispute resolution procedure before Developer may bring Developer's dispute before a third party. This agreement to first attempt resolution of disputes internally shall survive termination or expiration of this Agreement.
- 10.2 Mediation. At Franchisor's option, any claim, controversy or dispute that is not resolved pursuant to Section 10.1 hereof shall be submitted to non-binding mediation. Developer shall provide Franchisor with written notice of Developer's intent to pursue any unresolved claim, controversy or dispute, specifying in sufficient detail the nature thereof, prior to commencing any legal action. Franchisor shall have thirty (30) days following receipt of Developer's notice to exercise Franchisor's option to submit such claim, controversy or dispute to mediation. Mediation shall be conducted through a mediator or mediators in accordance with the American Arbitration Association Commercial Mediation Rules.
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the Developer is required to indemnify Baya Bar Franchise Systems, LLC, Baya Bar, LLC, its parent company, subsidiaries, divisions, affiliates, successors, assigns and designees, as well as their directors, officers, employees, agents, shareholders, successors, designees, and representatives. This indemnification extends to all claims related to the development, operation, condition, or any part of the Developer's Baya Bar outlets, the products, the premises, or any aspect of the real estate connected to the outlets. This includes claims caused by the Developer's agents or employees, or arising from the Developer's advertising or business practices.
The Developer is responsible for paying all losses and expenses, including attorneys' fees, incurred in connection with any action, suit, proceeding, or inquiry related to the indemnification. Baya Bar Indemnitees have the right to select and appoint independent counsel to represent them in any action or proceeding covered by this indemnity. The Developer must reimburse the Baya Bar Indemnitees as costs and expenses are incurred.
Furthermore, the Developer is considered an independent licensee and must indemnify Baya Bar and hold it harmless from any liability, loss, attorney's fees, or damage Baya Bar may suffer due to claims, demands, taxes, costs, or judgments against Baya Bar arising out of the established relationship. This includes costs, losses, expenses, and attorney's fees related to assignment or transfer of development rights, transactional costs, defaults under leases, subleases, notes, receipt of revenues, or any other relationships arising directly or indirectly out of the development and operation of the Baya Bar outlets. This means the developer takes on significant financial responsibility for any legal or financial issues that arise from their actions or the operations of their Baya Bar locations.