What standard of counsel is required for the Fly To Fit franchisee's defense of Indemnitees?

According to Fly To Fit's 2024 Franchise Disclosure Document, a franchisee is required to indemnify and defend Fly To Fit Franchise, its parent entities, subsidiaries, affiliates, and their respective owners, directors, officers, employees, agents, successors, and assignees (collectively, "Indemnitees") against all losses in any action related to the operation of the Fly To Fit business. The counsel used by the franchisee for this defense must be reasonably acceptable to Fly To Fit Franchise.

However, the franchisee is not obligated to indemnify an Indemnitee from actions arising from the Indemnitee's intentional misconduct or negligence. Any delay or failure by an Indemnitee to notify the franchisee of an action does not relieve the franchisee of their indemnity obligation unless the delay materially prejudices the franchisee. The franchisee cannot settle an action without the Indemnitee's consent, and this indemnity continues even after the franchise agreement ends.

Furthermore, an Indemnitee can choose to assume the defense of any action subject to indemnification, controlling all aspects of the defense, including negotiations and settlement, at the franchisee's expense. This assumption does not reduce the franchisee's obligation to indemnify the Indemnitees. This means that while the franchisee initially provides the defense with reasonably acceptable counsel, Fly To Fit has the option to take over the defense at the franchisee's expense, maintaining the franchisee's ultimate financial responsibility.