Who does the Mr. Sandless franchisee indemnify under the agreement?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
that we have no adequate remedy at law to prevent such harm. You acknowledge and agree on your own behalf and on behalf of the persons who are liable under this Section 18 that each has previously worked or been gainfully employed in other careers and that the provisions of this Section 18 in no way prevent any such person from earning a living. You further acknowledge and agree that the time limitation of this Section 18 shall be tolled during any default under this Section.
18.4 Covenants of Employees, Agents, and Third Persons
You shall require and obtain execution of covenants similar to those set forth in this Section 19.4 (including covenants applicable upon the termination of a person's employment with you) from all employees, contractors or third persons who will have access to Mr. Sandless proprietary and Confidential Information, and shall provide to us to an executed versions thereof. Such covenants shall be substantially in the form set forth in Attachment 4 as revised and updated from time to time and contained in the Manual.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, the franchisee is required to indemnify Mr. Sandless Franchise LLC. Specifically, the franchisee agrees to protect Mr. Sandless from any liability, loss, attorney's fees, or damages that Mr. Sandless might incur due to claims, demands, taxes, costs, or judgments. These liabilities must arise from allegations of an agent, partner, or employment relationship.
This means that if someone claims they were an employee or partner of Mr. Sandless due to the franchisee's actions and Mr. Sandless incurs costs defending against that claim, the franchisee is responsible for covering those costs. This clause emphasizes the independent contractor relationship between the franchisee and Mr. Sandless, ensuring that Mr. Sandless is shielded from liabilities arising from the franchisee's business operations.
Furthermore, the franchisee must secure similar covenants regarding confidential information from their employees, contractors, or any third parties who access Mr. Sandless's proprietary information. Should the franchisee fail to obtain these agreements, they are liable to indemnify and hold Mr. Sandless harmless from any resulting liability, loss, attorney's fees, or damage. This highlights the importance of protecting Mr. Sandless's confidential information and the franchisee's responsibility in ensuring that protection at all levels of their operation.
This indemnification extends to the failure to obtain executed restricted covenants from employees, agents, and third persons who have access to Mr. Sandless's confidential information. This means that the franchisee is responsible for ensuring that anyone with access to Mr. Sandless's confidential information signs an agreement to protect that information. If the franchisee fails to do so, they are responsible for any losses that Mr. Sandless incurs as a result.