Under what circumstances is a Cicis franchisee required to indemnify the Indemnified Parties?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
You agree to indemnify, defend, and hold harmless us, our affiliates, and our and their respective owners, managers, directors, officers, employees, agents, successors, and assignees (the "Indemnified Parties") against, and to reimburse any one or more of the Indemnified Parties for, all claims, obligations, and damages directly or indirectly arising out of: (i) the operation of the business you conduct under this Agreement, (ii) your breach of this Agreement, including, without limitation, those alleged to be caused by the Indemnified Party's negligence, and/or (iii) instituted by your employees, or by others that arise from your employment practices, unless (and then only to the extent that) the claims, obligations, or damages are determined to be caused solely by the Indemnified Party's intentional misconduct in a final, unappealable ruling issued by a court with competent jurisdiction. For purposes of this indemnification, "claims" include all obligations, damages (actual, consequential, or otherwise), and costs that any Indemnified Party reasonably incurs in defending any claim against it, including, without limitation, reasonable accountants', arbitrators', attorneys', and expert witness fees, costs of investigation and proof of facts, court costs, travel and living expenses, and other expenses of litigation or alternative dispute resolution, regardless of whether litigation or alternative dispute resolution is commenced. Each Indemnified Party may defend any claim against it at your expense (including choosing and retaining its own legal counsel) and agree to settlements or take any other remedial, corrective, or other actions. This indemnity will continue in full force and effect subsequent to and notwithstanding this Agreement's expiration or termination. An Indemnified Party 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 you under this subparagraph. You agree that a failure to pursue a recovery or mitigate a loss will not reduce or alter the amounts that an Indemnified Party may recover from you under this Section 8.B.
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a franchisee must indemnify, defend, and hold harmless Cicis, its affiliates, and their respective owners, managers, directors, officers, employees, agents, successors, and assignees (collectively known as the "Indemnified Parties") against claims, obligations, and damages. This indemnification extends to any claims, obligations, and damages that directly or indirectly arise from the franchisee's business operation under the Franchise Agreement.
Specifically, the franchisee's duty to indemnify covers situations resulting from (i) the operation of the business they conduct under the Agreement, (ii) any breach of the Franchise Agreement by the franchisee, including those allegedly caused by the Indemnified Party's negligence, and/or (iii) claims instituted by the franchisee's employees or others arising from the franchisee's employment practices. However, the franchisee is not required to indemnify the Indemnified Parties to the extent that the claims, obligations, or damages are determined to be caused solely by the Indemnified Party's intentional misconduct, as ruled by a court with competent jurisdiction.
The term "claims" includes all obligations, damages (actual, consequential, or otherwise), and costs that any Indemnified Party reasonably incurs in defending against any claim, including reasonable accountants', arbitrators', attorneys', and expert witness fees, costs of investigation and proof of facts, court costs, travel and living expenses, and other expenses related to litigation or alternative dispute resolution. Each Indemnified Party has the right to defend any claim at the franchisee's expense, including choosing their own legal counsel, and can agree to settlements or take other remedial actions. This indemnification obligation remains in effect even after the Franchise Agreement expires or terminates. An Indemnified Party is not required to seek recovery from any insurer or mitigate losses before making a claim against the franchisee, and failure to do so will not reduce the amounts recoverable from the franchisee.