If a Crave franchisee breaches an agreement with the franchisor, is the franchisee required to indemnify the franchisor?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
CRAVE Franchising, LLC ("Franchisor") and ("Franchisee") are parties , to for a the Franchise operation Agreement of dated a Crave restaurant at (the "Franchised Business"). In accordance with Article 2 of the Franchise Agreement, Franchisee certifies to Franchisor that, to the best of Franchisee's knowledge, the Franchised Business and its adjacent areas comply with all applicable federal, state and local accessibility laws, statutes, codes, rules, regulations and standards, including but not limited to the Americans with Disabilities Act. Franchisee acknowledges that it is an independent licensee and the requirement of this certification by Franchisee does not constitute ownership, control, leasing or operation of the Franchised Business. Franchisee acknowledges that Franchisee has relied on the information contained in this certification. Furthermore, Franchisee acknowledge its obligation under this Franchise Agreement directors, to and indemnify employees of and the in officers, connection with any and all claims, losses, costs, expenses, liabilities, compliance costs, and damages incurred by the indemnified party(ies) as a result of any matters associated with Franchisee's compliance with the Americans with Disabilities Act, as well as the costs, including attorneys' fees, related to the same.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees acknowledge their obligation to indemnify the franchisor under certain conditions. Specifically, in Attachment 7 to the Franchise Agreement, the franchisee agrees to indemnify the franchisor, its officers, directors, and employees.
This indemnification extends to any claims, losses, costs, expenses, liabilities, compliance costs, and damages incurred by the franchisor. This obligation is specifically tied to matters associated with the franchisee's compliance with the Americans with Disabilities Act (ADA), including all related costs and attorney's fees.
In practical terms, this means that if a Crave franchisee fails to comply with ADA regulations at their restaurant, and this failure leads to any legal claims or expenses for the franchisor, the franchisee is responsible for covering those costs. This could include expenses related to lawsuits, settlements, or any necessary changes to ensure ADA compliance. Franchisees should ensure they fully understand and comply with all ADA requirements to avoid potential indemnification obligations.