Does the Byrider franchise agreement require the franchisee to indemnify Byrider for losses arising from the franchisee's business operation?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
11.3 Indemnification.
- A. Franchisee shall indemnify and hold harmless the Company, its subsidiaries and affiliates, and their respective officers, directors, shareholders, agents and employees, from and against any and all losses, expenses, judgments, claims, reasonable attorneys' fees, and damages arising out of or in connection with any claim arising directly or indirectly from, as a result of, or in connection with Franchisee's operation of the Franchisee's Business. Franchisee shall promptly notify the Company of any suits filed by or against Franchisee in connection with the operation of the Franchisee's Business and, upon request, shall furnish the Company with copies of such documents from the suit as the Company may request.
- B. The Company shall indemnify and hold the Franchisee harmless from and against any and all claims, and the cost of defending such claims, caused by the gross negligence or willful misconduct of the Company or arising from any mandatory specification, standard or procedure contained in the Manual that is determined to be unlawful, provided that the Franchisee shall have given the Company timely notice of such claim or proceeding and is not in default under this Agreement and, provided further, that the Company shall have the right to participate in and, to the extent the Company deems necessary, to control any such litigation or proceeding.
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to the 2025 Byrider Franchise Disclosure Document, the franchisee is required to indemnify Byrider. Specifically, the franchisee must protect Byrider, its subsidiaries, affiliates, officers, directors, shareholders, agents, and employees from any losses, expenses, judgments, claims, reasonable attorneys' fees, and damages. This indemnification applies to claims that arise directly or indirectly from the franchisee's operation of the Byrider business. The franchisee is also required to promptly inform Byrider of any suits filed by or against them related to the business and provide copies of relevant documents upon request.
However, the FDD also states that Byrider will indemnify and hold the franchisee harmless from claims and defense costs resulting from Byrider's gross negligence or willful misconduct. This protection also extends to claims arising from any mandatory specification, standard, or procedure in the Byrider manual that is determined to be unlawful. For this protection to apply, the franchisee must provide timely notice of the claim and not be in default under the agreement. Byrider also retains the right to participate in and control any related litigation or proceeding if deemed necessary.
This mutual indemnification clause is a fairly standard practice in franchising. It outlines the responsibilities of both the franchisee and franchisor in the event of legal claims or losses. The franchisee's indemnification protects Byrider from liabilities caused by the franchisee's business operations, while Byrider's indemnification protects the franchisee from liabilities caused by Byrider's actions or requirements. Prospective franchisees should carefully review this section of the Franchise Agreement with legal counsel to fully understand their obligations and rights.