Under what circumstances must an Americas Best Value Inn franchisee indemnify the franchisor?

According to the 2025 Americas Best Value Inn FDD, provisions requiring a franchisee to indemnify the franchisor are modified under certain conditions. Specifically, an Americas Best Value Inn franchisee is not obligated to indemnify, reimburse, defend, or hold harmless the franchisor or any other indemnified party if the losses or liabilities are caused by the indemnified party's gross negligence, willful misconduct, strict liability, or fraud. This modification is applicable to any such provision within the franchise agreement or related agreements.

This modification serves as a protective measure for the franchisee, ensuring they are not held responsible for liabilities arising from the franchisor's own actions or negligence. It shifts the responsibility for such losses back to the franchisor, which is a significant consideration for prospective franchisees. This clause is particularly relevant in states like Washington, where franchise laws provide specific protections to franchisees.

For a prospective Americas Best Value Inn franchisee, this means that while the franchise agreement may initially contain clauses requiring indemnification, these clauses are limited. The franchisee should carefully review the franchise agreement and related documents to understand the scope of their indemnification obligations, ensuring they are aware of the protections afforded to them under applicable state laws. It is advisable to seek legal counsel to fully understand the implications of these provisions and how they apply in the franchisee's specific circumstances.