Under what circumstances is the Indemnification fee payable to Zoomin Groomin?

According to Zoomin Groomin's 2025 Franchise Disclosure Document, the Indemnification fee is payable for any loss that Zoomin Groomin incurs as a result of the franchisee's operation of the Franchised Business. The amount of this fee will vary depending on the specific circumstances and is incurred as needed.

In practical terms, this means that if a franchisee's actions or inactions during the operation of their Zoomin Groomin franchise lead to a financial loss for the franchisor, the franchisee will be responsible for covering those losses. This could include a wide range of situations, such as legal liabilities, settlements, or damages resulting from the franchisee's negligence or breach of contract.

Franchisees should be aware that the Indemnification fee is in addition to other fees outlined in the FDD, such as the Royalty Fee, Advertising Fund Contribution, and Technology Fee. Given the potentially variable and unpredictable nature of this fee, it is crucial for prospective franchisees to fully understand their responsibilities and obligations under the Franchise Agreement and to operate their business in a manner that minimizes the risk of incurring losses that could trigger the Indemnification fee. It would be prudent to seek legal counsel to fully understand the scope and implications of this indemnification clause.

While the FDD specifies that the Indemnification fee is "payable for any loss we incur from your operation of the Franchised Business," it does not provide specific examples or scenarios that would trigger this fee. Therefore, it is important for prospective franchisees to seek clarification from Zoomin Groomin regarding the types of events or actions that could lead to the assessment of this fee.