What is the franchisee's responsibility if Nothing Bundt Cakes receives notice of a Third-Party Claim?
Nothing_Bundt_Cakes Franchise · 2025 FDDAnswer from 2025 FDD Document
Promptly after the receipt by any of Our Indemnitees of notice of the commencement of any action against Our Indemnitee by a third party (such action, a "Third-Party Claim"), Our Indemnitee will, if a claim with respect thereto is to be made for indemnification pursuant to this Section 18.2 give a claim notice to you with respect to such Third-Party Claim. No delay or failure on the part of Our Indemnitee in so notifying you will limit any liability or obligation for indemnification pursuant to this Section 18.2, except to the extent of any material prejudice to you with respect to such claim caused by or arising out of such delay or failure. We will have the right to assume control of the defense of such Third-Party Claim, and you and your principals will be responsible for the costs incurred in connection with the defense of such Third-Party Claim. You and your principals will furnish us with such information as it may have with respect to such Third-Party Claim (including copies of any summons, complaint or other pleading which may have been served on such party and any written claim, demand, invoice, billing or other document evidencing or asserting the same) and will otherwise cooperate with and assist us in the defense of such Third-Party Claim. The fees and expenses of counsel incurred by us will be considered Losses and Expenses for purposes of this Agreement. We may as we deems necessary and appropriate take such actions to take remedial or corrective action with respect thereof as may be, in our reasonable discretion, necessary for the protection of Our Indemnitees or the collective Bakeries within our System. We will not agree to any settlement of, or the entry of any judgment arising from, any Third-Party Claim without the prior written consent of you and your principals, which will not be unreasonably withheld, conditioned or delayed. Any settlement or compromise of any Third-Party Claim must include a written release from liability of such claim for all Our Indemnitees. For purposes of this Section 18.2, "Losses and Expenses" means losses, liabilities, claims, penalties, damages (compensatory, exemplary, and punitive), fines, payments, attorneys' fees, experts' fees, court costs, costs associated with investigating and defending against claims, settlement
Source: Item 23 — RECEIPTS (FDD pages 93–309)
What This Means (2025 FDD)
According to Nothing Bundt Cakes' 2025 Franchise Disclosure Document, if Nothing Bundt Cakes receives notice of a Third-Party Claim, the franchisee has specific responsibilities. After Nothing Bundt Cakes receives notice of a Third-Party Claim against them, they will provide the franchisee with a claim notice. The franchisee's failure or delay to provide notice will not impact indemnification unless it materially prejudices the franchisee regarding the claim.
The franchisee and their principals must provide Nothing Bundt Cakes with all relevant information about the Third-Party Claim, including copies of any summons, complaints, pleadings, written claims, demands, invoices or other documents related to the claim. The franchisee must also cooperate with and assist Nothing Bundt Cakes in the defense of the Third-Party Claim.
Nothing Bundt Cakes has the right to assume control of the defense of any Third-Party Claim, and the franchisee and their principals are responsible for the costs incurred in connection with the defense. Nothing Bundt Cakes may take remedial or corrective action to protect its indemnitees or the collective bakeries within its system. Nothing Bundt Cakes will not agree to any settlement or judgment without the prior written consent of the franchisee and their principals, which cannot be unreasonably withheld, conditioned, or delayed. Any settlement must include a written release from liability for all of Nothing Bundt Cakes' indemnitees. The fees and expenses of counsel incurred by Nothing Bundt Cakes will be considered Losses and Expenses for purposes of the agreement.