When is the indemnification payment due to Engel & Volkers?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Additional Technology Services Fees | According to then current Technology Price List. | Upon receipt of an invoice. | Payable to us or our agent. (See Note 12) |
| Development Services Designation Annual Fee | $2,500 - $6,000 depending on number of participating designees. | Upon receipt of an invoice. | Development services designation is an optional program for qualified franchisees. (See Note 13) |
| Development Services Consulting Fee | Varies. | Upon receipt of an invoice. | (See Note 13) |
| Commerical Designation Annual Fee | $5,000 - $6,000 per year (depending on obtaining a Commercial Designation) | Upon receipt of invoice | The Commercial Designation is an optional program for qualified franchisees. (See Note 13) |
| Limited Purpose Location Fee | $2,500 per location | Upon receipt of an invoice. | Payable if we permit you to open an additional physical location as a limited purpose location for sales or administrative purposes. |
| Transfer Fee (See Note 1) | $2,500 administrative fee. $10,000 or such higher amount as is necessary to reimburse our reasonable costs, in the case of a securities offering. | Before or at transfer. | There are no other requirements. (See Note 14) |
| Purchases of marketing articles (See Note 1) | (See Note 13) | Upon receipt of an invoice. | (See Note 15) |
| Renewal Fee (See Note 1) | 50% of Initial Franchise Fee | Before the effective date of the Renewal Term | There are other requirements for renewal in addition to paying the renewal fee. |
| Interest (See Note 1) | The highest rate permitted by applicable law, or if there is no such rate 4% above the prime rate of interest identified by Citibank, N.A. in New York City | On demand. | Payable on all amounts in arrears from the first day of each month that an amount is past due. For any fees that were not timely reported interest will be payable from the first day of each month that an amount is past due, should |
| Type of Fee | Amount | Due Date | Remarks they have been timely reported. |
| Attorneys’ Fees | Varies | On demand. | You are responsible for our costs and attorney’s fees if we incur them in any litigation proceeding with you in which we prevail or if we have to obtain an injunction against you. |
| Indemnification | You must indemnify us and other parties against all costs and expenses, including attorney’s fees, arising out of claims by third parties as a result of your actions or omissions | On demand | Payable to us or our affiliates and their respective directors, officers, employees or agents. |
| Tax indemnity | You must pay us the amount of any state or local sales, use, gross receipts or similar tax that w |
Source: Item 6 — OTHER FEES (FDD pages 22–30)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the indemnification payment is due on demand. Franchisees must indemnify Engel & Volkers and other parties against all costs and expenses, including attorney’s fees, arising out of claims by third parties as a result of the franchisee's actions or omissions. This payment is made to Engel & Volkers, its affiliates, and their respective directors, officers, employees, or agents.
This means that if a third party makes a claim against Engel & Volkers due to something the franchisee did or failed to do, the franchisee is responsible for covering all related costs. These costs can include attorney's fees and other expenses incurred by Engel & Volkers in defending against the claim. The payment is due when Engel & Volkers demands it, which could be at any point during the claim process.
Indemnification clauses are standard in franchise agreements. They protect the franchisor from liabilities arising from the franchisee's operations. For a prospective Engel & Volkers franchisee, this highlights the importance of operating the business responsibly and in compliance with all applicable laws and regulations to minimize the risk of third-party claims. It also underscores the need for adequate insurance coverage to protect against potential liabilities.