Who are the Franchisee Indemnifying Parties that agree to indemnify Franchisor under the Belocal franchise agreement?

According to Belocal's 2025 Franchise Disclosure Document, the Franchisee Indemnifying Parties agree to indemnify Indemnitees and any third-party manager (as well as their affiliates, representatives, and employees) against any fines, claims, suits, or proceedings that may arise from the management of the Franchised Business by Belocal or a third-party manager. This indemnification is specifically applicable when Belocal exercises its step-in rights to manage the Franchised Business.

This means that if Belocal steps in to manage a franchise location, the franchisee and related parties are responsible for covering any legal or financial issues that arise during that management period. This includes responsibility for the actions of Belocal or a third-party manager while they are running the business.

This clause is significant because it shifts the risk of business operation during a step-in period back onto the franchisee, even though Belocal or a third party is in control. A prospective franchisee should carefully consider the potential financial implications of this indemnification, especially the possibility of incurring additional expenses and liabilities during a period when they are not directly managing their business. It is advisable to seek legal counsel to fully understand the scope of this indemnity and its potential impact.