Does the obligation to indemnify survive the termination or expiration of the Moes Southwest Grill Franchise Agreement?
Moes_Southwest_Grill Franchise · 2025 FDDAnswer from 2025 FDD Document
13. INDEMNIFICATION; INSURANCE
13.1 Indemnification.
- A.
Indemnification Obligation.
You must defend, indemnify, and hold harmless us and our affiliates, our and their permitted successors and assigns, and each of our and their respective direct and indirect owners, directors, officers, managers, employees, agents, attorneys, and representatives (collectively, the "Indemnified Parties") from and against all Losses (defined below), which any of the Indemnified Parties may suffer, sustain, or incur as a result of a claim asserted or inquiry made formally or informally, or a legal action, investigation, or other proceeding brought, by a third party and directly or indirectly arising out of or relating to: (i) the operation of the Franchised Business; (ii) the business you conduct under this Agreement; (iii) your breach of this Agreement; (iv) your noncompliance or alleged noncompliance with any Law; or (v) any allegation that we or another Indemnified Party is a joint employer or otherwise responsible for your acts or omissions relating to your employees. "Losses" include all obligations, liabilities, damages (actual, consequential, or otherwise), and reasonable defense costs that any Indemnified Party incurs.
Defense costs include arbitrators', attorneys', and expert witness fees, costs of investigation and proof of facts, court costs, travel and living expenses, and other expenses of litigation, arbitration, or alternative dispute resolution, regardless of whether litigation, arbitration, or alternative dispute resolution is commenced.
- B.
Indemnification Procedure.
We will promptly no
Source: Item 22 — Contracts (FDD page 92)
What This Means (2025 FDD)
According to the 2025 Moe's Southwest Grill Franchise Disclosure Document, the franchisee's obligation to defend, indemnify, and hold harmless Moe's Southwest Grill and its affiliates extends beyond the termination or expiration of the Franchise Agreement.
Specifically, the franchisee is obligated to protect the Indemnified Parties from any losses resulting from third-party claims related to the operation of the franchised business, the franchisee's conduct under the agreement, breaches of the agreement, noncompliance with laws, or allegations of joint employer status. These "Losses" encompass all obligations, liabilities, damages, and reasonable defense costs incurred by the Indemnified Parties.
This means that even after the franchise agreement ends, a former Moe's Southwest Grill franchisee could still be responsible for covering legal costs and damages if a claim arises from their past operation of the business. This could include issues like customer injuries, employee disputes, or violations of regulations that occurred during the franchise term. The indemnification procedure outlines that Moe's Southwest Grill will promptly notify the franchisee of any claim.