What is the deadline for an Indemnified Party to provide written notice to the franchisee after becoming aware of a claim under the Cicis franchise agreement?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
If a claim is commenced for which defense or indemnity is claimed to be due under Section 14.A or if an Indemnified Party becomes aware of facts which, if not corrected, might give rise to a right of defense or indemnification under that section, the Indemnified Party must give written notice thereof to you as soon as practicable but in no event more than 10 business days following the date on which the Indemnified Party becomes aware of such a claim.
Failure to give prompt notice will not relieve you of your obligation to defend or indemnify except to the extent you are materially prejudiced by such failure.
The Indemnified Party will reasonably cooperate with you and you counsel, at your expense, in the defense of the relevant claim.
In all cases, the Indemnified Party will use commercially reasonable efforts to mitigate the controllable costs it incurs in connection with any claims that are subject to indemnification under this Section 14.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, if an Indemnified Party (which could be Cicis or related parties) becomes aware of a claim that could trigger the franchisee's obligation to defend or indemnify them, they must provide written notice to the franchisee. This notice must be given as soon as practicable, but no later than 10 business days after the Indemnified Party becomes aware of the claim.
Missing this deadline does not automatically relieve the franchisee of their obligations. The franchisee is only excused from defending or indemnifying Cicis if the delay in notification materially prejudices their ability to mount a defense. This means the franchisee must demonstrate that the late notice significantly harmed their ability to respond to the claim effectively.
The Indemnified Party is also required to reasonably cooperate with the franchisee and their counsel in defending the claim, with the franchisee responsible for covering the expenses. Furthermore, the Indemnified Party must make commercially reasonable efforts to minimize controllable costs associated with any claims subject to indemnification under this section of the franchise agreement. This clause highlights the importance of clear and timely communication regarding potential claims to ensure both parties can effectively manage and mitigate risks.