Under what conditions can the license granted to Carls to access and use the Licensed Applications be considered a material breach of the agreement?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
3.1. License. Subject to the terms and conditions of the Agreement and the applicable Addendums, Olo hereby grants to Operator, during the Term, a non-exclusive, nonsublicensable (except as permitted hereunder), non-transferable (except pursuant to Section 10.4) license to access and use for itself and its End Users, the specific Licensed Applications selected in the applicable Customer Order Form. Operator shall not (a) assign this Agreement to any third party (it being understood that any such assignment shall be void ab initio); or (b) transfer, sell, or assign the right to use the Licensed Applications, including for the avoidance of doubt to any Customer Third Party Provider (except pursuant to Section 10.4). Olo reserves the right, in its sole discretion, to promulgate commercially reasonable standards that must be adhered to by Customer Third Party Providers (including, but not limited to, Olo's certification of all integrations to the Olo APIs). Any Customer Third Party Provider's breach or suspected breach of data security or confidentiality, abuse, or malicious or suspected malicious activities, may (at Olo's sole discretion) necessitate the immediate suspension, and possible termination, of Customer Third Party Provider's access to the Licensed Applications. A breach of the obligationsset forth in this Section 3.1 by Operator may constitute a material breach of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 80–480)
What This Means (2024 FDD)
According to the 2024 FDD, a breach of the obligations set forth in Section 3.1 of the agreement by the Operator (Carls franchisee) may constitute a material breach of the agreement. Section 3.1 outlines the terms of the license granted to the franchisee to access and use specific Licensed Applications.
Carls grants a non-exclusive, non-sublicensable, and non-transferable license to the franchisee to access and use the Licensed Applications selected in the Customer Order Form during the term of the agreement. The franchisee is prohibited from assigning the agreement to any third party or transferring, selling, or assigning the right to use the Licensed Applications, including to any Customer Third Party Provider, except as permitted.
Olo reserves the right to set commercially reasonable standards for Customer Third Party Providers, including certifying integrations to the Olo APIs. Any breach or suspected breach of data security or confidentiality, abuse, or malicious activities by a Customer Third Party Provider may lead to the suspension or termination of their access to the Licensed Applications at Olo's discretion. Therefore, any violation of these terms by the Carls franchisee could be considered a material breach of the agreement, potentially leading to termination of the agreement.