Does the Southern Steer franchise agreement require franchisees to indemnify for claims related to breaches of security?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchisee will indemnify the Indemnified Parties, without limitation, for all Damages arising from, out of, in connection with, relating to, or as a result of any and all Claims including, but not limited to:
- ix.
Breaches of Security, regardless of whether an Indemnified Party is required to take any action under any state or federal law;
x. violation of any data privacy laws;
xi. failure to comply with the PCI DSS and/or other information security standards required by the Franchisor; and
xii. any other Claims brought against any of the Indemnified Parties.
17.5.
Franchisor's Gross Negligence and Intentional Misconduct.
The Franchisee will not be obligated to indemnify the Indemnified Parties for any Damages attributable to, arising out of, from, in connection with, or as a result of any gross negligence or intentional misconduct by the Indemnified Parties.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to the 2025 Southern Steer Franchise Disclosure Document, franchisees are required to indemnify the franchisor for claims related to breaches of security. Specifically, the franchisee will indemnify the Indemnified Parties for all Damages arising from Breaches of Security, regardless of whether an Indemnified Party is required to take any action under any state or federal law. This means the franchisee is responsible for covering costs the franchisor incurs due to security breaches.
Furthermore, the franchisor has the right to take necessary actions to remedy a Breach of Security, including investigations and notifications. The franchisee is obligated to cooperate with Southern Steer and provide all necessary information to aid in compliance with data breach notification laws and to help determine if the breach was effectively mitigated.
The franchisee is responsible for all costs and expenses incurred by Southern Steer related to the Breach of Security and compliance with the law. This includes any government fines or penalties imposed on Southern Steer as a result of the breach. Alternatively, Southern Steer can require the franchisee to take action to remedy the Breach of Security at the franchisee's expense. However, the franchisee is not obligated to indemnify the Indemnified Parties for any Damages attributable to, arising out of, from, in connection with, or as a result of any gross negligence or intentional misconduct by the Indemnified Parties.