Which sections of the Floyds 99 Franchise Agreement and Development Agreement cover indemnification obligations?
Floyds_99 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 21.3 Indemnification.
The Franchisee shall indemnify, defend and hold harmless the Franchisor, its subsidiaries, parents and affiliates, and their respective shareholders, equity owners, partners, directors, officers, managers, members, employees, agents, representatives, successors and assigns (the "Indemnified Parties"), against, and to reimburse them for all claims, obligations, fines, suits, proceedings, demands, actions of any kind and nature, and damages described in this Section 21.3, any and all obligations described in Section 21.2 and any and all claims and liabilities directly or indirectly arising out of or is based upon or related to this Agreement, the operation of the FLOYD'S 99 Shop or arising out of all acts and omissions of the Franchisee and its employees related to labor or employment practices, failure to comply with any applicable laws or regulations, or the use of the Marks and Licensed Methods in any manner not in accordance with this Agreement.
For purposes of this indemnification, claims shall mean and include all obligations, actual and consequential damages and costs reasonably incurred in the defense of any claim against the Indemnified Parties (including any claims Franchisee brings against the Indemnified Parties), including, without limitation, reasonable accountants', attorneys' and expert witness fees, costs of investigation and proof of facts, court costs, other litigation expenses and travel and living expenses.
The Franchisor shall have the right to defend any such claim against it.
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 29–30)
What This Means (2025 FDD)
According to the 2025 Floyds 99 Franchise Disclosure Document, Section 21.3 of the Franchise Agreement outlines the franchisee's indemnification obligations to the franchisor. This section requires the franchisee to indemnify, defend, and hold harmless the franchisor and its related parties from all claims, suits, proceedings, demands, and actions arising out of the Franchise Agreement, the operation of the Floyds 99 shop, or the acts and omissions of the franchisee and its employees. This includes claims related to labor or employment practices, failure to comply with laws or regulations, or the use of the Marks and Licensed Methods in a manner not in accordance with the agreement.
The indemnification extends to all obligations described in Section 21.2, which pertains to the franchisee's responsibility for paying third parties, taxes, and any claims arising from labor or employment law violations committed by the franchisee. The definition of "claims" for indemnification purposes includes all obligations, actual and consequential damages, and costs reasonably incurred in defending against any claim, including accountants', attorneys', and expert witness fees, investigation costs, court costs, and other litigation expenses.
The franchisor retains the right to defend any claim against it. For franchisees in New York, a rider modifies Section 21.3, stating that the franchisee is not required to indemnify the franchisor for liabilities resulting from the franchisor's breach of the agreement or other civil wrongs committed by the franchisor. This indemnification clause is a standard inclusion in franchise agreements, designed to protect the franchisor from liabilities caused by the franchisee's actions or inactions during the operation of the franchise.