What is the scope of the Bee Organized franchisor's indemnification of the franchisee?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
10.C. INDEMNIFICATION BY FRANCHISOR
Franchisor shall indemnify, defend, and hold Franchisee and Franchisee's officers, directors, shareholders, members, owners, partners, agents, representatives, independent contractors, employees, assigns and successors (the "Franchisee Indemnified Parties") harmless from all losses, expenses, claims, causes of action, lawsuits, liabilities, taxes, costs, demands, proceedings, investigations, hearings, and/or damages solely arising out of, or solely relating to, Franchisor's gross negligence in the operation of Franchisee's Bee Organized Business that was the direct cause of any such loss, expense, liability or damage provided Franchisee immediately notifies Franchisor of such claim, cause of action, lawsuit, demand, proceeding, investigation or hearing, and Franchisor shall pay all of the Franchisee Indemnified Parties' reasonable costs, fees and expenses of defending any such claim, cause of action, lawsuit, demand, proceeding, investigation, and/or hearing brought against any of the Franchisee Indemnified Parties or any such claim, cause of action, lawsuit, demand, proceeding, investigation, and/or hearing in which any of the Franchisee Indemnified Parties is named as a party, including, without limitation, reasonable accountant fees, attorney
fees, and expert witness fees, court costs, deposition fees, travel expenses and other litigation expenses provided Franchisee immediately notifies Franchisor of such claim, cause of action, lawsuit, demand, proceeding, investigation or hearing. Franchisor agrees that the terms of this Article 10.C. shall survive the termination, expiration or Transfer of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 54–218)
What This Means (2025 FDD)
According to Bee Organized's 2025 Franchise Disclosure Document, the franchisor will indemnify, defend, and hold harmless the franchisee and their related parties from losses, expenses, claims, lawsuits, liabilities, taxes, costs, demands, proceedings, investigations, hearings, and/or damages. This indemnification applies only when these issues arise solely from the franchisor's gross negligence in the operation of the franchisee's Bee Organized Business and are the direct cause of the loss, expense, liability, or damage.
To be eligible for indemnification, the franchisee must immediately notify Bee Organized of any such claim, lawsuit, demand, proceeding, or investigation. Bee Organized will then cover the reasonable costs, fees, and expenses for defending against these claims, including accountant fees, attorney fees, expert witness fees, court costs, deposition fees, travel expenses, and other litigation expenses. Again, the franchisee must immediately notify Bee Organized of any such claim or legal action.
The terms of this indemnification survive the termination, expiration, or transfer of the Franchise Agreement, providing ongoing protection even after the franchise relationship ends. This protection is limited to situations directly caused by Bee Organized's gross negligence, emphasizing the importance of clear communication and documentation in the event of any claim or legal action.