Can either party unilaterally terminate the License Agreement for 1 800 Packouts?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
In the License Agreement, Packout Holdings authorized us to use the Marks in connection with the offer, sale, and support of Franchised Businesses. The License Agreement does not contain any significant limitations on our right to use or license the Marks to you and is perpetual in duration and may be terminated unilaterally by either party only upon a material breach of the License Agreement. Upon termination of the License Agreement, we must immediately discontinue the use of the Marks and assign to Packout Holdings all of our franchise agreements licensing the use of the Marks, and Packout Holdings has agreed to assume all obligations under such agreements arising from and after their assignment.
Source: Item 13 — TRADEMARKS (FDD pages 44–45)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the License Agreement with Packout Holdings, which authorizes 1 800 Packouts to use the Marks in connection with the offer, sale, and support of Franchised Businesses, can be terminated unilaterally by either party. However, this right to unilateral termination is conditional.
The License Agreement can only be terminated unilaterally upon a material breach of the License Agreement. This means that one party must significantly violate the terms of the agreement for the other party to have the right to terminate it without the other party's consent.
Upon termination of the License Agreement, 1 800 Packouts must immediately discontinue the use of the Marks and assign to Packout Holdings all of its franchise agreements licensing the use of the Marks. Packout Holdings has agreed to assume all obligations under such agreements arising from and after their assignment. This ensures continuity for franchisees even if the License Agreement between 1 800 Packouts and Packout Holdings is terminated.