What happens to the franchise agreements if the License Agreement is terminated for 1 800 Packouts?

According to 1 800 Packouts's 2025 Franchise Disclosure Document, the License Agreement between Packout Holdings and 1 800 Packouts dictates the use of the Marks for franchising. The License Agreement, effective as of July 2, 2015, allows 1 800 Packouts to use the Marks for offering, selling, and supporting franchises. It remains in effect perpetually unless there is a material breach, in which case either party can terminate it.

If the License Agreement is terminated, 1 800 Packouts must immediately stop using the Marks. More importantly for franchisees, 1 800 Packouts is obligated to assign all of its franchise agreements that license the use of the Marks to Packout Holdings. Packout Holdings, in turn, has agreed to assume all obligations under these franchise agreements from the point of assignment forward.

This arrangement provides a level of security for 1 800 Packouts franchisees. Even if the License Agreement between 1 800 Packouts and Packout Holdings is terminated, Packout Holdings will take over the franchise agreements and assume the obligations, ensuring continuity for the franchisees. This transfer of responsibility aims to protect the franchisees' interests and maintain the operational status of their businesses under the 1 800 Packouts brand, even in the event of a dispute between 1 800 Packouts and Packout Holdings.