factual

Does the indemnification obligation in the Card My Yard franchise agreement survive the termination or expiration of the agreement?

Card_My_Yard Franchise · 2025 FDD

Answer from 2025 FDD Document

You agree to indemnify, defend and hold harmless us, our Affiliates, and our and their respective shareholders, directors, officers, employees, agents, successors and assignees (the "Indemnified Parties") against, and to reimburse any one or more of the Indemnified Parties for, any and all claims, and liabilities directly or indirectly arising out of the operation of the Card My Yard business or your breach of this Agreement, without limitation and without regard to the cause or causes thereof or the negligence (whether such negligence be sole, joint or concurrent, or active or passive) or strict liability of us or any other party or parties in connection therewith. Notwithstanding the foregoing, this indemnity shall not apply to any liability arising from our gross negligence or willful misconduct, except to the extent that joint liability is involved, in which event the indemnification provided herein shall extend to any finding of comparative or contributory negligence attributable to you, your Owners, officers, directors, employees, independent contractors or Affiliates. For purposes of this indemnification, "claims" includes all obligations, damages (actual, consequential, exemplary or other) and costs reasonably incurred in the defense of any claim against any of the Indemnified Parties, including, without limitation, accountants', mediators', arbitrators', attorneys' and expert witness fees, costs of investigation and proof of facts, court costs, other expenses of litigation, arbitration or alternative dispute resolution and travel and living expenses. We have the right to defend any such claim against us. This indemnity will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement. Under no circumstances will we or any other Indemnified Party be required to seek recovery from any insurer or other third party, or otherwise to mitigate our, their or your losses and expenses, in order to maintain and recover fully a claim against you. You agree that a failure to pursue such recovery or mitigate a loss will in no way reduce or alter the amounts we or another Indemnified Party may recover from you. The terms of this Article XVI. shall survive the termination, expiration or transfer of this Agreement or any interest herein.

Source: Item 23 — RECEIPTS (FDD pages 84–259)

What This Means (2025 FDD)

According to Card My Yard's 2025 Franchise Disclosure Document, the franchisee's obligation to indemnify the franchisor continues even after the franchise agreement expires or is terminated. Specifically, the franchisee agrees to indemnify, defend, and hold harmless Card My Yard, its affiliates, and their respective shareholders, directors, officers, employees, agents, successors, and assignees from any claims and liabilities arising from the operation of the Card My Yard business or any breach of the franchise agreement.

This indemnification extends to all obligations, damages, and costs reasonably incurred in defending against any claim, including legal fees and expenses. However, the franchisee is not responsible for liabilities arising from Card My Yard's gross negligence or willful misconduct, except in cases of joint liability where the franchisee's comparative or contributory negligence is involved.

This clause remains in effect even after the agreement's termination, expiration, or transfer, meaning that a former franchisee could still be liable for claims arising from their past operation of the Card My Yard business. Card My Yard is not required to seek recovery from any insurer or third party before pursuing a claim against the franchisee, and the franchisee's failure to mitigate losses will not reduce the amounts Card My Yard may recover.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.