What losses are Bft Developers required to indemnify the Indemnitees against?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Indemnification. Developer agrees to indemnify, defend and hold Franchisor, its owners, affiliates, successors and assigns, and the directors, officers, owners, managers, employees, servants, agents of each (collectively, the "Indemnitees"), harmless from and against any and all losses, damage, claims, demands, liabilities and causes of actions of every kind or character and nature, as well as costs and expenses incident thereto (including reasonable attorneys' fees and court costs), that are brought against any of the Indemnitees that arise out of or are otherwise related to Developer's or an Indemnitee's (a) breach or attempted breach of, or misrepresentation under, this Agreement or in connection with the exercise of the Development Rights in any manner other than as authorized herein; (b) ownership, construction, development, management, or operation of any Studios that Developer or its affiliates own, including, without limitation, Developer's or an Indemnitee's employment practices; (c) gross negligence or intentional misconduct; and/or (d) alleging Developer's or its representatives' violation of Applicable Laws as set forth in Section 13.D below. Notwithstanding the foregoing, any Indemnitee may choose to engage counsel and defend against any such claim and may require immediate reimbursement from the Developer of all expenses and fees incurred in connection with such defense. This indemnity will continue in full force and effect subsequent to and notwithstanding this Agreement's expiration or termination. Indemnitees need not seek recovery from any insurer or other third party, or otherwise mitigate its losses and expenses, in order to maintain and recover fully a claim against Developer under this Section. Any Indemnitee's failure to pursue a recovery or mitigate a loss will not reduce or alter the amounts that person may recover from Developer under this Section.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the Developer agrees to protect the Indemnitees (which include Bft, its owners, affiliates, successors, assigns, and their respective directors, officers, owners, managers, employees, servants, and agents) from various losses. This means the Developer is financially responsible for covering certain costs and liabilities incurred by the Indemnitees.
The specific losses that Bft Developers must indemnify against include any losses, damages, claims, demands, liabilities, and causes of action, as well as related costs and expenses such as reasonable attorneys' fees and court costs. These liabilities arise if they are brought against any of the Indemnitees and stem from several key areas. These areas include any breach or attempted breach of the Development Agreement, or misrepresentations made by the Developer, especially concerning the authorized exercise of Development Rights.
Furthermore, the indemnification extends to issues related to the ownership, construction, development, management, or operation of any Studios owned by the Developer or its affiliates, including employment practices. It also covers situations involving gross negligence or intentional misconduct by the Developer, and allegations that the Developer or its representatives violated Applicable Laws. This indemnification clause remains effective even after the Development Agreement expires or is terminated. Indemnitees are not required to seek compensation from insurers or mitigate their losses before claiming against the Developer, and failure to do so does not reduce the Developer's liability.