Does the Cool Binz franchisee's obligation to indemnify the Indemnified Parties survive the termination or expiration of the Franchise Agreement?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
You must protect, defend, and indemnify us, and all of our past, present, and future shareholders, direct and indirect parent companies, subsidiaries, affiliates, officers, directors, employees, attorneys, and designees (the "Indemnified Parties"), and hold Indemnified Parties harmless from and against any and all costs and expenses, including attorneys' fees, court costs, losses, liabilities, damages, claims and demands of every kind or nature on account of any actual or alleged loss, injury, or damage to any person, firm, or corporation, or to any property arising out of, or in connection with, your operation of the COOL BINZ Business. Your obligation to indemnify us will survive the termination or expiration of your Franchise Agreement.
Under no circumstances will we, or any other Indemnified Party, be required to seek recovery from any insurer or other third party, in order to maintain and recover fully a claim against you. You agree that a failure to pursue recovery against others will in no way reduce or alter the amounts we or another Indemnified Party may recover from you.
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, the franchisee's obligation to indemnify the Indemnified Parties does indeed survive the termination or expiration of the Franchise Agreement. This means that even after the franchise agreement ends, either through termination or expiration of its term, the franchisee remains responsible for covering certain costs and expenses related to the operation of the Cool Binz business.
Specifically, the franchisee must protect, defend, and indemnify Cool Binz and its associated parties (including shareholders, parent companies, subsidiaries, officers, directors, employees, and attorneys) from any costs, expenses, losses, liabilities, damages, claims, and demands arising from the operation of the Cool Binz business. This includes expenses such as attorneys' fees and court costs. The obligation extends to any actual or alleged loss, injury, or damage to any person, firm, or corporation, or to any property connected with the Cool Binz business.
This survival clause has significant implications for a prospective Cool Binz franchisee. Even after ceasing operations, the franchisee could still be held financially responsible for incidents that occurred during the term of the franchise agreement. It is also important to note that Cool Binz is not required to seek recovery from any insurer or other third party before pursuing a claim against the franchisee. This could potentially expose the franchisee to substantial financial risk even after the franchise agreement has ended.