What is the Crawlspace Medic franchisee's responsibility regarding indemnification obligations?
Crawlspace_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
15.6.Indemnification. TO THE FULLEST EXTENT PERMITTED BY LAW, FRANCHISEE AGREES TO EXONERATE AND INDEMNIFY AND HOLD HARMLESS CSM FRANCHISE GROUP, LLC, CRAWLSPACE MEDIC, LLC, AND ANY OF EITHER'S PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES (COLLECTIVELY REFERRED TO AS THE "CRAWLSPACE MEDIC INDEMNITEES") AS WELL AS THE CRAWLSPACE MEDIC INDEMNITEES' DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES, FROM ALL CLAIMS BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATED TO THE OPERATION, CONDITION, OR ANY PART OF FRANCHISEE'S CRAWLSPACE MEDIC FRANCHISE, THE FRANCHISED BUSINESS, THE PRODUCTS, THE PREMISES, OR ANY ASPECT OF THE REAL ESTATE CONNECTED TO FRANCHISEE'S FRANCHISED BUSINESS, WHETHER CAUSED BY FRANCHISEE, FRANCHISEE'S AGENTS OR EMPLOYEES, OR ARISING FROM FRANCHISEE'S ADVERTISING OR BUSINESS PRACTICES, REGARDLESS OF WHETHER THE ALLEGED INJURY OR LIABILITY IS CAUSED IN WHOLE OR IN PART BY ANY NEGLIGENT ACT OR OMISSION OF THE CRAWLSPACE MEDIC INDEMNITEES. FRANCHISEE AGREES TO PAY FOR ALL THE CRAWLSPACE MEDIC INDEMNITEES' LOSSES, EXPENSES (INCLUDING, BUT NOT LIMITED TO ATTORNEYS' FEES) OR CONCURRENT OR CONTRIBUTING LIABILITY INCURRED IN CONNECTION WITH ANY ACTION, SUIT, PROCEEDING, INQUIRY (REGARDLESS OF WHETHER THE SAME IS REDUCED TO JUDGMENT OR DETERMINATION), OR ANY SETTLEMENT THEREOF FOR THE INDEMNIFICATION GRANTED BY FRANCHISEE HEREUNDER. THE CRAWLSPACE MEDIC INDEMNITEES SHALL HAVE THE RIGHT TO SELECT AND APPOINT INDEPENDENT COUNSEL TO REPRESENT ANY OF THE CRAWLSPACE MEDIC INDEMNITEES IN ANY ACTION OR PROCEEDING COVERED BY THIS INDEMNITY. FRANCHISEE AGREES THAT TO HOLD THE CRAWLSPACE MEDIC INDEMNITEES HARMLESS, FRANCHSIEE WILL REIMBURSE THE CRAWLSPACE MEDIC INDEMNITEES AS THE COSTS AND EXPENSES ARE INCURRED BY THE CRAWLSPACE MEDIC INDEMNITEES.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2024 FDD)
According to the 2024 Crawlspace Medic Franchise Disclosure Document, the franchisee has extensive indemnification responsibilities to protect Crawlspace Medic and its related entities. The franchisee agrees to exonerate, indemnify, and hold harmless CSM Franchise Group, LLC, Crawlspace Medic, LLC, and their parent companies, subsidiaries, affiliates, successors, assigns, designees, as well as their directors, officers, employees, agents, shareholders, successors, designees, and representatives. This indemnification covers all claims related to the franchisee's Crawlspace Medic franchise operation, the franchised business, products, premises, or any aspect of the real estate connected to the franchised business.
The franchisee's indemnification extends to situations caused by the franchisee, their agents, or employees, and also includes issues arising from the franchisee's advertising or business practices. Importantly, this obligation applies regardless of whether the alleged injury or liability is partly or wholly due to any negligent act or omission by Crawlspace Medic itself. This means that even if Crawlspace Medic is partially at fault, the franchisee may still be responsible for covering the full extent of the claims.
The franchisee is responsible for paying all losses and expenses, including attorneys' fees, incurred by Crawlspace Medic in connection with any action, suit, proceeding, or inquiry related to the indemnification. Crawlspace Medic has the right to select and appoint independent counsel to represent them in any action covered by this indemnity. The franchisee must reimburse Crawlspace Medic for these costs and expenses as they are incurred, ensuring that Crawlspace Medic is held harmless. This section of the FDD highlights a significant financial responsibility for the franchisee, as they could be liable for substantial costs arising from various operational aspects of their franchise.