What costs are included in the indemnification provided by the Gold Star franchisee to the company?

According to Gold Star's 2025 Franchise Disclosure Document, the franchisee is required to indemnify, defend, and hold Gold Star harmless from any claims, debts, liabilities, or obligations that arise directly or indirectly from the operation of the store. This indemnification excludes liabilities caused by the franchisee's proper reliance on or use of procedures or materials provided by Gold Star, or liabilities caused by Gold Star's gross negligence.

The costs covered by the franchisee's indemnification include all costs incurred by Gold Star in defending against or responding to claims, including legal and accounting fees. This means that if a claim is made against Gold Star due to the franchisee's operations, the franchisee is responsible for covering Gold Star's expenses in dealing with the claim.

This indemnification clause is a standard practice in franchising, designed to protect the franchisor from liabilities arising from the franchisee's day-to-day operations. However, it's important to note the exceptions: Gold Star assumes responsibility for its own gross negligence and for issues arising from the franchisee's proper use of Gold Star's systems and materials. A prospective franchisee should carefully consider the scope of this indemnification and consult with a legal professional to fully understand their obligations and potential liabilities.