What does the Hyper Kidz franchisee agree to do regarding indemnification of the franchisor and its affiliates?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
TO THE FULLEST EXTENT PERMITTED BY LAW, FRANCHISEE AGREES TO EXONERATE AND INDEMNIFY AND HOLD HARMLESS BOOMERANG FRANCHISE LLC 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 "HYPER KIDZ INDEMNITEES"), FROM ALL CLAIMS BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATED TO THE OPERATION, CONDITION, OR ANY PART OF FRANCHISEE'S HYPER KIDZ® 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 HYPER KIDZ 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. THE HYPER KIDZ INDEMNITEES SHALL HAVE THE RIGHT TO SELECT AND APPOINT INDEPENDENT COUNSEL TO REPRESENT ANY OF THE HYPER KIDZ INDEMNITEES IN ANY ACTION OR PROCEEDING COVERED BY THIS INDEMNITY. FRANCHISEE AGREES THAT TO HOLD THE HYPER KIDZ INDEMNITEES HARMLESS, FRANCHISEE WILL REIMBURSE THE HYPER KIDZ INDEMNITEES AS THE COSTS AND EXPENSES ARE INCURRED BY THE HYPER KIDZ INDEMNITEES.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, the franchisee agrees to exonerate, indemnify, and hold harmless Boomerang Franchise LLC, its parent company, subsidiaries, divisions, affiliates, successors, assigns, designees, as well as their directors, officers, employees, agents, shareholders, successors, designees, and representatives from all claims related to the franchisee's Hyper Kidz franchise. This includes claims arising from the operation, condition, or any part of the franchise, the franchised business, the products, the premises, or any aspect of the real estate connected to the franchised business. The indemnification extends to situations caused by the franchisee, their agents, or employees, and also covers issues arising from the franchisee's advertising or business practices.
The franchisee is responsible for covering all losses and expenses, including attorneys' fees, incurred by the Hyper Kidz indemnitees in connection with any action, suit, proceeding, or inquiry, regardless of whether it results in a judgment or determination. This also includes any settlement related to the indemnification. The Hyper Kidz indemnitees have the right to select and appoint independent counsel to represent them in any action covered by this indemnity.
The franchisee is obligated to reimburse the Hyper Kidz indemnitees for costs and expenses as they are incurred. This means that the franchisee's financial responsibility for legal and other costs arises as these costs are billed, rather than waiting for the resolution of a claim. This indemnification clause is extensive, placing a significant responsibility on the franchisee to protect Hyper Kidz from liabilities associated with the operation of the franchise.