What does it mean for a Fly Fitness franchisee to indemnify Fly Fitness Indemnitees?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
TO THE FULLEST EXTENT PERMITTED BY LAW, FRANCHISEE AGREES TO EXONERATE AND INDEMNIFY AND HOLD HARMLESS FLY FITNESS FRANCHISE, L.L.C., FLY HOLDINGS, LLC, LICENSOR, AND ANY OF THESE COMPANIES' PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES AS WELL AS THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES (COLLECTIVELY REFERRED TO AS THE "FLY FITNESS INDEMNITEES"), FROM ALL CLAIMS BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATED TO THE OPERATION, CONDITION, OR ANY PART OF FRANCHISEE'S FLY FITNESS 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.
FRANCHISEE AGREES TO PAY FOR ALL THE FLY FITNESS 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.
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, as a franchisee, you are responsible for protecting Fly Fitness Franchise, L.L.C., Fly Holdings, LLC, Licensor, and their parent company, subsidiaries, divisions, affiliates, successors, assigns, designees, directors, officers, employees, agents, shareholders, successors, designees, and representatives (collectively referred to as the "Fly Fitness Indemnitees") from claims related to your Fly Fitness franchise. This means you agree to cover any losses, expenses, or liabilities they incur due to the operation, condition, or any aspect of your franchise business, including issues related to the products, premises, real estate, advertising, or business practices. This holds true whether the issues are caused by you, your agents, or your employees.
In practical terms, if someone sues Fly Fitness because of an incident at your franchise location (for example, a customer injury), you would be responsible for covering Fly Fitness's legal costs, settlement amounts, and any other related expenses. This obligation extends to any action, suit, proceeding, or inquiry, regardless of whether it results in a judgment or settlement. The FDD emphasizes that you must pay for all losses and expenses, including attorney's fees, that the Fly Fitness Indemnitees incur in connection with any claim for which you've granted indemnification.
This indemnification clause is a standard practice in franchising, designed to protect the franchisor from liabilities arising from the franchisee's operations. It's important to understand that this responsibility can have significant financial implications, as you could be liable for substantial costs if a major claim arises. Therefore, maintaining adequate insurance coverage and adhering to Fly Fitness's operational standards are crucial to minimizing potential risks and fulfilling your indemnification obligations.
Prospective Fly Fitness franchisees should carefully consider the scope of this indemnification clause and consult with a legal professional to fully understand their obligations and potential liabilities. It is also important to ensure that your insurance coverage adequately protects you against potential claims and liabilities related to your franchise operation.