Does the Hydrodog franchisee's indemnification obligation extend to claims arising from the Hydrodog Business's operation?
Hydrodog Franchise · 2025 FDDAnswer from 2025 FDD Document
- 18.4 Indemnification. You agree to indemnify, defend and hold harmless us, our affiliates, our parents, and our and our affiliates' and parents' respective shareholders, directors, officers, employees, agents, successors and assignees (the "Indemnified Party(ies)") against and to reimburse any one or more of the Indemnified Parties for all claims, obligations and damages described in this Section, any and all taxes described in this Agreement and any and all claims and liabilities directly or indirectly arising out of your HydroDog Business's operation (even if our negligence is alleged, but not proven) or your breach of this Agreement. For purposes of this indemnification, "claims" includes all obligations, damages (actual, consequential or otherwise) and costs reasonably incurred in the defense of any claim against any of the Indemnified Parties, including, without limitation, reasonable accountants', arbitrators', attorneys', paralegals' and expert witness fees, costs of investigation and proof of facts, court costs, other expenses of litigation, arbitration or alternative dispute resolution and travel and living expenses. We have the right to defend any such claim against us. This indemnity will continue in full force and effect subsequent to and notwithstanding the expiration or termination of this Agreement. Under no circumstances will we or any other Indemnified Party be required to seek recovery from any insurer or other third party, or otherwise to mitigate our, their or your losses and expenses, in order to maintain and recover fully a claim against you. You agree that a failure to pursue such recovery or mitigate a loss will in no way reduce or alter the amounts we or another Indemnified Party may recover from you.
Source: Item 23 — RECEIPTS (FDD pages 43–166)
What This Means (2025 FDD)
According to Hydrodog's 2025 Franchise Disclosure Document, the franchisee's indemnification obligation does extend to claims arising from the Hydrodog Business's operation. Specifically, the franchisee must indemnify Hydrodog and its related parties against claims and liabilities that directly or indirectly arise out of the Hydrodog Business's operation. This obligation exists even if Hydrodog's negligence is alleged, unless proven.
This means that as a Hydrodog franchisee, you could be responsible for covering Hydrodog's legal costs and damages resulting from the operation of your franchise. The definition of "claims" includes all obligations, damages (actual, consequential, or otherwise), and costs reasonably incurred in defending against any claim, including legal fees, investigation costs, court costs, and travel expenses.
Hydrodog retains the right to defend any claim against them, and neither Hydrodog nor any indemnified party is required to seek recovery from any insurer or mitigate losses before pursuing a claim against the franchisee. The franchisee's obligation to indemnify Hydrodog remains in effect even after the franchise agreement expires or is terminated. This broad indemnification clause places a significant financial risk on the franchisee, as they could be liable for substantial costs and damages arising from their business operations, even if those issues are partially attributable to Hydrodog.