Regarding indemnification for Dermani Medspa, are Indemnified Parties required to seek recovery from insurers or mitigate losses before making a claim against the franchisee?

According to Dermani Medspa's 2025 Franchise Disclosure Document, an Indemnified Party does not need to seek recovery from any insurer or other third party, or otherwise mitigate its losses and expenses, before making a claim against the franchisee. The franchisee agrees 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 them.

This means that if Dermani Medspa or its affiliates suffer a loss for which the franchisee is liable under the indemnification clause, they can immediately seek full recovery from the franchisee without first attempting to claim from insurance or reduce the loss in any way. This places a significant financial burden on the franchisee, as they could be responsible for covering the entire loss even if other potential sources of recovery exist.

This indemnification clause is broad and continues even after the franchise agreement expires or terminates. It is important for a prospective Dermani Medspa franchisee to fully understand the scope of this indemnification and to assess the potential financial risks associated with it. Franchisees should consult with a legal and financial advisor to evaluate the implications of this clause and to determine appropriate risk management strategies, such as insurance coverage.