conditional

If an Indemnified Party is found negligent, does that automatically relieve the Focalpoint Coaching franchisee of their indemnification obligations?

Focalpoint_Coaching Franchise · 2025 FDD

Answer from 2025 FDD Document

and damages directly or indirectly arising out of the Franchised Business' operation, employment matters in connection with the Franchised Business, the business Franchisee conducts under this Agreement, or Franchisee's breach of this Agreement, including, without limitation, those alleged to be or found to have been caused by the Indemnified Party's negligence, unless (and then only to the extent that) the claims, obligations, or damages are determined to be caused solely by Franchisor's gross negligence or willful misconduct in a final, unappealable ruling issued by a court or arbitrator with competent jurisdiction. Franchisee agrees to give Franchisor and the Indemnified Parties written notice of any action, suit, proceeding, claim, demand, inquiry or investigation that could be the basis for a claim for indemnification by any of the Indemnified Parties within three (3) days of Franchisee's actual or constructive knowledge of it. The Indemnified Parties shall have the right, in their sole discretion to: (i) retain counsel of their own choosing to represent them with respect to any claim; and (ii) control the response thereto and the defense thereof, including the right to enter into settlements or take any other remedial, corrective, or other actions. Franchisee agrees to give its full cooperation to the Indemnified Parties in assisting the Indemnified Parties with the defense of any such claim, and to reimburse the Indemnified Parties for all of their costs and expenses in defending any such claim, including court costs and reasonable attorneys' fees, within ten (10) days of the date of each invoice delivered by the Indemnified Parties to Franchisee enumerating such costs, expenses and attorneys' fees.

Source: Item 22 — Contracts (FDD pages 56–57)

What This Means (2025 FDD)

According to the 2025 Focalpoint Coaching Franchise Disclosure Document, a franchisee's indemnification obligations are not automatically relieved if an Indemnified Party is found negligent. The franchisee is still responsible for covering claims and damages arising from the operation of the franchised business, employment matters, the franchisee's conduct, or any breach of the agreement, even if the Indemnified Party's negligence contributed to the issue.

However, there is an exception: the franchisee is only relieved of their indemnification obligations to the extent that the claims, obligations, or damages are determined to be caused solely by Focalpoint Coaching's gross negligence or willful misconduct. This determination must be made by a court or arbitrator with competent jurisdiction in a final, unappealable ruling.

This means that a Focalpoint Coaching franchisee could still be responsible for significant costs even if the franchisor was partially at fault. The franchisee should give Focalpoint Coaching written notice of any action that could lead to a claim for indemnification within three days of becoming aware of it. Focalpoint Coaching also has the right to choose legal counsel and control the response to any claim. The franchisee must cooperate fully in the defense of any claim and reimburse Focalpoint Coaching for all costs, including legal fees, within ten days of receiving an invoice.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.