What is the standard of negligence that triggers indemnification by the Bee Organized franchisor?
Bee_Organized Franchise · 2025 FDDAnswer from 2025 FDD Document
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 a franchisee if the loss, expense, liability, or damage arises solely from the franchisor's gross negligence in the operation of the franchisee's Bee Organized business. The gross negligence must be the direct cause of the loss, expense, liability, or damage.
For a Bee Organized franchisee, this means that the franchisor is only responsible for covering losses if its actions are more than just negligent; they must be grossly negligent. Gross negligence typically implies a significant disregard for the well-being or safety of others. This is a higher standard than ordinary negligence, which is the failure to exercise reasonable care.
To be eligible for indemnification, the franchisee must immediately notify Bee Organized of any claim, cause of action, lawsuit, demand, proceeding, investigation, or hearing. If these conditions are met, Bee Organized will cover the franchisee's reasonable costs, fees, and expenses of defending against any such claim. This includes accountant fees, attorney fees, expert witness fees, court costs, deposition fees, travel expenses, and other litigation expenses. The terms of this indemnification survive the termination, expiration, or transfer of the Franchise Agreement.