Under the Best Western AutoClerk agreement, what specific events trigger the customer's obligation to indemnify AutoClerk?
Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
- 4.2 Customer's Indemnification.
Customer shall indemnify, defend and hold harmless AutoClerk and its Affiliates, and each of its and their respective officers, members, directors, employees, agents, subcontractors, successors and assigns (each, including AutoClerk, an "AutoClerk Indemnitee") from and against any and all Losses incurred by the AutoClerk Indemnitees in connection with any Action by a third party arising out of or related to: (i) Customer Content; (ii) use of the Service by or on behalf of Customer with any hardware, software, system, or service that is neither provided by AutoClerk nor authorized by AutoClerk; (iii) a breach by or on behalf of Customer of any representation, warranty, covenant or obligation under this Agreement; (iv) any gross negligence, misuse or act or omission by or on behalf of Customer with respect to the Service or in connection with this Agreement; or (v) use of the Service by or on behalf of Customer that is outside the use authorized by this Agreement.
- 4.3 Indemnification Procedure.
Each party shall promptly notify the other party in writing of any Action for which that party believes it is entitled to be indemnified.
Source: Item 23 — Receipts (FDD pages 108–413)
What This Means (2025 FDD)
According to Best Western's 2025 Franchise Disclosure Document, the AutoClerk agreement outlines specific situations where the customer (Best Western franchisee) must indemnify AutoClerk. This means the franchisee is responsible for defending and protecting AutoClerk from losses, damages, or legal actions brought by a third party.
The franchisee's indemnification obligations are triggered by events directly related to their actions or content. These include claims arising from the franchisee's content, use of the service with hardware or software not provided or authorized by AutoClerk, breaches of the agreement, gross negligence or misuse of the service, or unauthorized use of the service. Essentially, if a third party sues AutoClerk because of something the franchisee did related to the AutoClerk service, the franchisee is responsible for covering AutoClerk's losses.
This indemnification clause is a standard practice in franchise agreements to protect the franchisor from liabilities caused by the franchisee's operation. However, it's crucial for a prospective Best Western franchisee to understand the scope of this obligation. They should carefully review the AutoClerk agreement to fully grasp what actions or omissions could trigger the indemnification clause and potentially lead to significant financial responsibility.
The franchisee should also be aware that they are responsible for promptly notifying AutoClerk of any action for which they believe they are entitled to be indemnified and cooperate with AutoClerk at AutoClerk's sole cost and expense. The franchisee may participate in the proceedings at its own cost and expense with counsel of its own choosing.