Under what circumstances is an Eos Worldwide franchisee NOT required to indemnify the Indemnified Parties?
Eos_Worldwide Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) You agree to indemnify, defend and hold harmless us, our affiliates and our and our affiliates' respective members, directors, officers, owners, employees, agents, contractors, advisors, successors and assignees (each an "Indemnified Party" and collectively the "Indemnified Parties") against and to reimburse each Indemnified Party for all losses, expenses, judgments, settlements, claims, liabilities, investigations, reasonable legal fees, costs (including, without limitation, expert witness fees, court costs, accounting fees, travel and living expenses) and damages arising out of any claim directly or indirectly related to the operation of your Franchise or your Franchised Business, or arising out of a breach of this Agreement or any other agreement you sign with us or any affiliate of ours in connection with your Franchise as well as any and all of your obligations to file and pay taxes described in this Agreement; provided, however, that you shall not be required to hold harmless or indemnify us for any losses relating to any claim to the extent such losses arise out of our gross negligence or willful misconduct.
Source: Item 23 — RECEIPTS (FDD pages 74–246)
What This Means (2025 FDD)
According to the 2025 Eos Worldwide Franchise Disclosure Document, a franchisee is generally required to indemnify the Indemnified Parties, which include Eos Worldwide, its affiliates, and their respective members, directors, officers, owners, employees, agents, contractors, advisors, successors, and assignees. This means the franchisee must protect these parties from losses, expenses, judgments, settlements, claims, liabilities, investigations, legal fees, costs, and damages related to the operation of the franchise or any breach of agreements.
However, the FDD specifies an exception to this indemnification requirement. An Eos Worldwide franchisee is not required to hold harmless or indemnify Eos Worldwide for losses relating to any claim if such losses arise out of Eos Worldwide's gross negligence or willful misconduct. This provision offers a degree of protection to the franchisee in situations where Eos Worldwide's own actions are the primary cause of the losses.
This type of clause is relatively standard in franchise agreements. It aims to balance the responsibilities between the franchisor and franchisee. While franchisees are typically responsible for their own actions and the operation of their specific franchise, franchisors usually retain liability for their own gross negligence or willful misconduct. Prospective Eos Worldwide franchisees should carefully consider this indemnification clause and understand the circumstances under which they may or may not be responsible for covering losses.