When is the Indemnification fee due for a Potbelly Sandwich Works franchise, and what does it cover?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
| Column 1 | Column 2 | Column 3 | Column 4 |
|---|---|---|---|
| Indemnification | Will vary under circumstances and depend on nature of third- party claim | As incurred | You must reimburse us if we are held liable for claims from your Shop’s operation or incur costs to defend them (when we are not at fault). |
Source: Item 6 — OTHER FEES (FDD pages 17–24)
What This Means (2025 FDD)
According to Potbelly Sandwich Works's 2025 Franchise Disclosure Document, the Indemnification fee is due 'as incurred.' The amount of the fee will vary based on the circumstances and the nature of the third-party claim.
This fee is charged to reimburse Potbelly Sandwich Works if they are held liable for claims arising from the operation of your Potbelly Sandwich Works shop, or if they incur costs to defend against such claims, provided they are not at fault. This means that if someone sues Potbelly Sandwich Works because of something that happened at your shop (for example, a customer injury), and Potbelly Sandwich Works has to pay damages or legal fees, you will be responsible for reimbursing them.
This type of indemnification clause is common in franchise agreements. It protects the franchisor from liabilities caused by the franchisee's business operations. As a prospective franchisee, it's important to understand that you are responsible for the actions and operations within your Potbelly Sandwich Works location and to maintain adequate insurance coverage to protect against potential claims.