What is the scope of 'Damages' that a Ledgers franchisee is liable for under the indemnity clause?

According to the 2025 Ledgers Franchise Disclosure Document, the scope of damages a franchisee is liable for under the indemnity clause is limited. Specifically, in Washington state, the franchisee is not obligated to indemnify Ledgers or any other indemnified party for losses or liabilities resulting from the indemnified party's negligence, willful misconduct, strict liability, or fraud. This modification protects the franchisee from liability for damages caused by Ledgers's own actions or omissions.

This provision is particularly important for prospective franchisees as it clarifies the extent to which they are responsible for covering the franchisor's potential liabilities. Without this modification, a franchisee could be held liable for damages even when the franchisor is at fault. This limitation on the indemnity clause provides a more equitable distribution of risk between Ledgers and its franchisees.

It is important to note that this modification specifically applies to franchises governed by Washington state law. Franchisees in other states may have different indemnity obligations, so it is crucial to review the specific terms of the franchise agreement and any applicable state laws to fully understand their potential liabilities. Prospective franchisees should consult with legal counsel to ensure they understand the implications of the indemnity clause and how it may affect their business.