Does the Floyds 99 franchisee's indemnification obligation continue after the expiration or termination of the franchise agreement?

According to Floyds 99's 2025 Franchise Disclosure Document, the franchisee's obligation to indemnify the franchisor extends beyond the termination or expiration of the franchise agreement. This means that even after the franchise agreement ends, the franchisee may still be responsible for covering losses, damages, or liabilities that the franchisor incurs due to the franchisee's actions or the operation of the Floyds 99 shop. This indemnification clause remains in effect regardless of whether the agreement ends naturally through expiration or is terminated early.

This continued obligation has significant implications for a prospective Floyds 99 franchisee. It means that even after ceasing operations, the franchisee could face financial responsibility for past actions or events related to the franchise. For example, if a customer injury occurred during the franchise term but a lawsuit is filed after the agreement ends, the franchisee could still be liable for indemnifying Floyds 99 against any resulting costs.

Franchisees should carefully consider the scope of the indemnification clause and understand the potential long-term financial risks. It is advisable to consult with a legal professional to fully grasp the extent of these obligations and to assess appropriate risk management strategies, such as insurance coverage, to mitigate potential liabilities that may arise even after the franchise agreement has concluded. This is not unusual in the franchise industry, as franchisors seek to protect themselves from liabilities arising from the franchisee's operation of the business, even after the business relationship has ended.