What failures related to laws or regulations require the Multi-Unit Developer to indemnify the Franchisor Indemnified Parties for Southern Steer?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
vironmental contamination resulting from any act or omission of the Multi-Unit Developer and/or Controlled Entity (if any) or their Executive Management, employees, agents or representatives;
- (b) any failure on the part of the Multi-Unit Developer and/or Controlled Entity (if any) to comply with any requirement of any federal or state laws or any rules or regulations of any Governmental Authority;
- (c) any failure of the Multi-Unit Developer and/or Controlled Entity (if any) to pay any of its obligations to any person or Entity;
- (d) any failure of the Multi-Unit Developer and/or Controlled Entity (if any) to comply with any requirement or condition of this Agreement, the Brand Manual, any Franchise Agreement or any other agreement with the Franchisor and/or the Franchisor Indemnified Parties;
- (e) any misfeasance or malfeasance by the Multi-Unit Developer and/or Controlled Entity (if any) or their Executive Management, employees, agents or representatives;
- (f) any tort committed by the Multi-Unit Developer and/or Controlled Entity (if any) or their Executive Management, employees, agents or representatives;
- (g) any determination by a court or agency that the Franchisor is the employer or a joint employer of any of Multi-Unit Developer and/or Controlled Entity's (if any) employees;
- (h) any claim, action, suit, or proceeding by Franchisee's employees, including but not limited to workers compensation, unemployment, and wage-and-hour claims; and
- (i) any other Claims brought against any of the Franchisor Indemnified Parties.
- Franchisor's Gross Negligence and Intentional Misconduct. Neither the Multi-Unit Developer nor the Controlled Entity (if any) will be obligated to indemnify the Franchisor Indemnified Parties for any Damages attributable to, arising out of, from, in connection with, or as a result of any gross negligence or intentional misconduct by the Franchisor Indemnified Parties.
- Payment of Costs and Expenses. The Multi-Unit Developer and/or the Controlled Entity (if any) will pay all reasonable attorneys' fees, costs and expenses incurred by the Franchisor Indemnified Parties to defend any action brought by a third party against any of the Franchisor Indemnified Parties as set forth in Section 13.1.
- Survival.
Source: Item 5 — and 7 of the FDD, Section 3.1 of the Franchise Agreement and Section 4.1 of the Multi-Unit Development Agreement are hereby amended to state that payment of the initial franchise fee and development fee will be deferred until We have satisfied Our pre-opening obligations, and You have commenced business operations. (FDD pages 168–290)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, the Multi-Unit Developer must indemnify the Franchisor Indemnified Parties for damages resulting from failures to comply with laws and regulations. Specifically, the Multi-Unit Developer is responsible for covering damages if they or their Controlled Entity fail to meet the requirements of any federal or state laws, or the rules and regulations of any Governmental Authority. This means that if the Multi-Unit Developer's actions, or inactions, lead to legal or regulatory violations, they are obligated to protect the Franchisor Indemnified Parties from any resulting claims or losses.
This indemnification extends to various types of claims, including personal injury, property damage, commercial loss, or environmental contamination arising from the actions or omissions of the Multi-Unit Developer, their management, employees, or representatives. It also covers any failure to pay obligations to any person or entity, non-compliance with the Multi-Unit Developer Agreement, the Brand Manual, any Franchise Agreement, or any other agreement with Southern Steer. The Multi-Unit Developer is also responsible for misfeasance, malfeasance, or any tort committed by them or their representatives.
Furthermore, the Multi-Unit Developer is liable for claims arising from a determination that Southern Steer is the employer or joint employer of the Multi-Unit Developer's employees, as well as any claims by the Multi-Unit Developer's employees, such as workers' compensation, unemployment, and wage-and-hour claims. The Multi-Unit Developer is also responsible for any other claims brought against the Franchisor Indemnified Parties. However, the Multi-Unit Developer is not required to indemnify the Franchisor Indemnified Parties for damages resulting from the gross negligence or intentional misconduct of the Franchisor Indemnified Parties.
This indemnification clause places a significant responsibility on the Multi-Unit Developer to ensure compliance with all applicable laws and regulations. It is crucial for prospective Multi-Unit Developers to understand the scope of this obligation and to implement robust compliance measures to mitigate the risk of incurring substantial damages. They should also consult with legal counsel to fully understand their obligations and potential liabilities under the Multi-Unit Developer Agreement.