What is a Byrider franchisee required to do if a suit is filed against them in connection with the operation of their Byrider business?
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, if a franchisee is sued in connection with their Byrider business, they must promptly notify Byrider of the suit. Additionally, upon Byrider's request, the franchisee must provide copies of any documents related to the suit.
This requirement is part of the indemnification agreement, where the franchisee agrees to protect Byrider from losses, expenses, judgments, claims, attorney's fees, and damages arising from the franchisee's business operations. This means that if a customer or other party sues the franchisee for something related to the business (e.g., a faulty car, a financing dispute), the franchisee is responsible for covering Byrider's costs associated with the suit, provided the claim arises directly or indirectly from the franchisee's operation.
However, Byrider also provides indemnification to the franchisee under certain conditions. Byrider will protect the franchisee from claims and the costs of defending those claims if the claims are caused by Byrider's gross negligence or willful misconduct, or if they arise from a mandatory specification, standard, or procedure in the manual that is determined to be unlawful. For Byrider to provide this protection, the franchisee must give Byrider timely notice of the claim and not be in default under the Franchise Agreement. Byrider also has the right to participate in and control any litigation or proceeding it deems necessary.