Does the Beverly Anns Cookie franchisee's indemnification obligation extend to situations where the Indemnified Parties are alleged or proven to be negligent?
Beverly_Anns_Cookie Franchise · 2025 FDDAnswer from 2025 FDD Document
obligations to make payments either (i) to or for third party claimants by any and all Indemnified Parties, including refunds, or (ii) incurred by any and all Indemnified Parties to investigate, take action, respond to or defend a matter, including investigation and trial charges, costs and expenses, fees, fees paid to professionals, attorney fees, experts' fees, court costs, settlement amounts, judgments and costs of collection (collectively, "Losses and Expenses"), incurred by any Indemnified Parties for any investigation, claim, action, suit, demand, administrative or alternative dispute resolution proceeding, actually or allegedly, directly or indirectly, relating to, arising out of, or resulting from or in connection with: any transaction, occurrence, product or service involving the Franchised Business or this Franchise Agreement; your employment or other contractual relationship with your employees, workers, managers, or independent contractors, including but not limited to any allegation, claim, finding, or ruling that we are an employer or joint employer of your employees; your marketing, selling, or providing of items and services; and any breach of violation of any agreement (including this Franchise Agreement), or any law, regulation or ruling, by any act, error or omission (active or passive) of you, any party associated with you, or any of your or your affiliates' owners, officers, directors, managers, employees, owners and agents, including when any of the Indemnified Parties is alleged or proven to be negligent.
Source: Item 23 — RECEIPTS (FDD pages 57–235)
What This Means (2025 FDD)
According to Beverly Anns Cookie's 2025 Franchise Disclosure Document, the franchisee's indemnification obligation does extend to situations where the Indemnified Parties are alleged or proven to be negligent. The franchisee is required to indemnify, defend, and hold harmless the Indemnified Parties from all losses and expenses. This includes payments to third-party claimants, investigation costs, legal fees, and settlement amounts.
The franchisee's obligation covers any claim, action, suit, or proceeding that relates to the Franchised Business, the Franchise Agreement, the franchisee's employment relationships, marketing, and any breach of agreement or law. This broad coverage includes any act, error, or omission by the franchisee or their affiliates, even if the Indemnified Parties are alleged or proven to be negligent.
This means that a Beverly Anns Cookie franchisee could be responsible for covering the legal costs and damages incurred by Beverly Anns Cookie or its affiliates, even if the issue arises due to the negligence of Beverly Anns Cookie itself. This is a significant obligation that could expose the franchisee to substantial financial risk. Franchisees should carefully consider this indemnification clause and consult with legal counsel to understand the full extent of their potential liability.