Does the indemnification clause in the Aunt Millies Bakeries agreement include coverage for costs of settlement?

According to Aunt Millies Bakeries' 2025 Franchise Disclosure Document, the indemnification clause does include coverage for costs of settlement.

Section 12.5 of the agreement outlines that each party agrees to defend, indemnify, and hold the other harmless against third-party claims. This protection extends to any costs, charges, or claims, including reasonable attorneys' fees, expert fees, and costs of settlement. The claims must arise out of a party's direct or indirect failure to perform any obligation, discharge any liability under the agreement, or result from their negligence.

This means that if a franchisee of Aunt Millies Bakeries is sued by a third party due to negligence or failure to meet obligations under the Distribution Agreement, Aunt Millies Bakeries will cover the costs of defending against the lawsuit, including attorney's fees, expert witness fees, and any settlement costs. Conversely, the franchisee would have the same obligation to indemnify Aunt Millies Bakeries under similar circumstances. This mutual indemnification clause is a fairly standard provision in franchise agreements, designed to allocate risk and protect both parties from potential liabilities arising from their respective actions or inactions.