What must payments made by an indemnified party account for regarding insurance benefits in respect of such claims under the Bhc franchise agreement?

According to Bhc's 2025 Franchise Disclosure Document, any payments made by an indemnified party must account for any insurance benefits received in respect to the claims made. This means that if an indemnified party receives insurance benefits to cover a claim, the payments they make will be net of (reduced by) those insurance benefits.

In practical terms, this means that if Bhc is obligated to indemnify a franchisee due to a covered claim, and the franchisee receives insurance payments to offset the loss, the amount Bhc has to pay will be reduced by the amount the franchisee's insurance paid out. This prevents the franchisee from receiving double compensation for the same loss.

This provision ensures fairness in the indemnification process, preventing the indemnified party from profiting from a loss by receiving compensation from both the indemnifying party and their insurance company. Franchisees should ensure they understand their insurance coverage and how it interacts with the indemnification provisions in the franchise agreement.