Does the Chem Dry Collateral Assignment specify any conditions under which the Franchisee's obligation to indemnify the Franchisor would NOT apply?
Chem_Dry Franchise · 2024 FDDAnswer from 2024 FDD Document
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- Indemnification of Franchisor: Franchisee agrees to indemnify and hold Franchisor and its parents, affiliates, stockholders, directors, officers, principals, franchisees/licensees and representatives harmless from and against any and all losses, liabilities, claims, proceedings, demands, damages, judgments, injuries, attorneys' fees, costs and expenses, that they incur resulting from any claim brought against any of them or any action which any of them are named as a party or which any of them may suffer, sustain or incur by reason of, or arising out of, Franchisee's breach of any of the terms of the Lease, including the failure to pay rent or any other terms and conditions of the Lease.
Source: Item 22 — CONTRACTS (FDD page 68)
What This Means (2024 FDD)
Based on the 2024 Chem Dry Franchise Disclosure Document, the Collateral Assignment outlines the franchisee's agreement to indemnify the franchisor. Specifically, the franchisee agrees to protect Chem Dry from losses, liabilities, claims, and expenses resulting from the franchisee's breach of the lease agreement. This includes failure to pay rent or adhere to any other terms of the lease.
However, the document does not explicitly state any conditions under which this obligation to indemnify Chem Dry would not apply. The agreement emphasizes the franchisee's responsibility to cover costs arising from lease-related breaches. The Collateral Assignment ensures Chem Dry's security interest in the lease and assets, allowing them to take action in case of franchisee default.
While the FDD excerpt details the franchisee's indemnification responsibilities, it does not list any scenarios where the franchisee would be exempt from this obligation. A prospective Chem Dry franchisee should seek clarification from the franchisor regarding any potential limitations or exceptions to the indemnification clause to fully understand their liabilities under the Collateral Assignment.