Does the indemnification clause in the Aunt Millies Bakeries agreement include attorney's fees?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
r. This Agreement may be amended or modified only by a writing signed by both parties. Notwithstanding the foregoing, nothing in this Distribution Agreement and any related agreement is intended to disclaim the express representations made in the Franchise Disclosure Document, its exhibits and amendments.
- §12.5 INDEMNIFICATION: Each party hereby agrees to defend, indemnify and hold the other harmless against a third party as to any costs, charges or claims including, without limitation, reasonable attorneys' fees, expert fees and costs of settlement, which may arise out of such party's direct or indirect failure to perform any obligation and/or discharge any liability arising under this Agreement or arising out of such party's negligence.
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to Aunt Millies Bakeries's 2025 Franchise Disclosure Document, the indemnification clause does include attorney's fees. Specifically, Section 12.5 states that each party agrees to defend, indemnify, and hold the other harmless against third-party claims, including reasonable attorneys' fees. This means that if a franchisee of Aunt Millies Bakeries is sued by a third party due to the franchisor's failure to perform an obligation or negligence, Aunt Millies Bakeries would be responsible for covering the franchisee's reasonable attorney's fees, and vice versa.
Section 11.6 further clarifies the matter of attorney's fees, stating that the prevailing party in any arbitration or other action to enforce the agreement will be entitled to recover its attorney's fees, expert fees, costs, and expenses, except as specifically provided in Section 11.2. This provision ensures that if legal action is necessary to enforce the agreement, the party who wins the case can recover the costs associated with legal representation.
These clauses are important for a prospective Aunt Millies Bakeries franchisee to consider, as they outline the circumstances under which the franchisor will cover legal costs. It is important to understand the scope and limitations of these indemnification and attorney's fees provisions to be fully aware of potential financial responsibilities in case of disputes or third-party claims.