Are there any exceptions to the Circle K franchisee's indemnification obligations as stated in the agreement?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
ARTICLE 17 INDEMNIFICATION
- 17.1 Indemnification.
Except as otherwise expressly provided in this Agreement, and without limiting Franchisor's common law rights of indemnification, Franchisee assumes sole and complete responsibility for and will, to the maximum extent permitted by law, defend, protect, indemnify, and hold harmless Franchisor, its Affiliates, and their respective directors, employees, officers, shareholders, managers, members, agents and successors and assigns (individually an "Indemnified Party" and collectively the "Indemnified Parties"), from and against any and all losses, costs, expenses, damages, and liability (including, without limitation, attorneys' fees and court costs) arising out of or relating to this Agreement, Franchisee's negligence, the operation or use of the Franchised Location or the Store, including any Additional Business, including any contracts with third parties related to the operation of the Store, or the equipment or supplies used in connection therewith, and whether arising from bodily injury, personal injury, or property damage, or any other violation of the rights of others, or in any other manner, whether incurred for an Indemnified Party's primary defense or for enforcement of its indemnification rights hereunder, on account of any personal injury, disease, or death of any person(s), damage to or loss of any property, or money damages or specific performance owed to any third party (by contract or operation of law), and any fines, penalties, assessments, environmental response costs, or injunctive obligations imposed upon any of the Indemnified Parties caused by, arising out of, or in any way incidental to, or in connection with, Franchisee's performance hereunder, or the performance, acts, or omissions by any retail customer or consumer served by Franchisee (including employees, agents, contractors, and invitees of Franchisee and Franchisee's resale customers and consumers), or any other person, including any Approved Third-Party Operator.
- 17.2 Risk Allocation.
Source: Item 22 — CONTRACTS (FDD page 100)
What This Means (2025 FDD)
According to the 2025 Circle K Franchise Disclosure Document, the franchisee's indemnification obligations are comprehensive, with one notable exception. The franchisee is generally responsible for defending, protecting, indemnifying, and holding harmless Circle K and its affiliates from any losses, costs, expenses, damages, and liabilities arising from the franchise agreement, the franchisee's negligence, or the operation of the Circle K store. This includes issues related to bodily injury, property damage, violations of rights, and environmental concerns.
However, the agreement states this indemnification applies "except as otherwise expressly provided in this Agreement". This means that if another section of the agreement specifically states that the franchisee is NOT responsible for certain liabilities or obligations, then that would take precedence over the general indemnification clause.
This exception is significant for prospective Circle K franchisees because it highlights the importance of carefully reviewing the entire franchise agreement to identify any specific situations where they might not be held responsible for certain liabilities. It is crucial to understand the full scope of responsibilities and potential liabilities, as well as any limitations or exceptions, before entering into the franchise agreement. Franchisees should seek legal counsel to fully understand their obligations and potential risks.