Under what circumstances is a Better Blend franchisee NOT obligated to indemnify an Indemnitee?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee shall indemnify and defend (with counsel reasonably acceptable to BBF) BBF, its parent entities, subsidiaries and affiliates, and their respective owners, directors, officers, employees, agents, successors and assignees (collectively, "Indemnitees") against all Losses in any Action by or against BBF and/or any Indemnitee directly or indirectly related to, or alleged to arise out of, the development or operation of the Business (including any Data Security Event), or any act or omission of Franchisee or any of Franchisee's Owners, officers, directors, employees or agents. Notwithstanding the foregoing, Franchisee shall not be obligated to indemnify an Indemnitee from Actions which Franchisee proves arose solely as a result of any Indemnitee's intentional misconduct or negligence. Any delay or failure by an Indemnitee to notify Franchisee of an Action shall not relieve Franchisee of its indemnity obligation except to the extent (if any) that such delay or failure materially prejudices Franchisee. Franchisee shall not settle an Action without the consent of the Indemnitee.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, a franchisee is generally required to indemnify Better Blend and its related parties (Indemnitees) against losses from actions related to the operation of the Better Blend business or any actions or omissions by the franchisee, its owners, officers, directors, employees, or agents. However, the franchisee is not obligated to indemnify an Indemnitee if the franchisee proves that the actions arose solely from the Indemnitee's intentional misconduct or negligence.
This means that if Better Blend or its related parties are directly responsible for intentional misconduct or negligence that leads to a claim or loss, the franchisee is not required to cover the costs of those actions. This provision aims to protect franchisees from being held liable for the franchisor's own wrongful actions.
It is important to note that the franchisee bears the burden of proof to demonstrate that the Indemnitee's intentional misconduct or negligence was the sole cause of the action. Additionally, any delay or failure by an Indemnitee to notify the franchisee of an action does not relieve the franchisee of their indemnity obligation unless such delay materially prejudices the franchisee's ability to defend against the action. The franchisee cannot settle any action without the Indemnitee's consent.