Under what circumstances does 1 800 Packouts have an obligation to approve or not unreasonably withhold approval of a franchisee's actions or requests?

According to the 2025 1 800 Packouts Franchise Agreement, the franchisor is generally not obligated to approve franchisee requests or to avoid unreasonably withholding approval unless the agreement explicitly states otherwise. Specifically, the agreement states that 1 800 Packouts has the absolute right to refuse any request or withhold approval of any actions requiring their approval, except where the agreement expressly obligates them to act reasonably. This means that franchisees should pay close attention to the specific terms of the Franchise Agreement to understand when 1 800 Packouts is legally bound to act reasonably in considering their requests or actions.

However, a lease agreement addendum specifies one instance where 1 800 Packouts must act reasonably. According to the lease agreement, a 1 800 Packouts franchisee has the right to install customary and usual display signs on the building façade, subject to the landlord's approval, which "shall not be unreasonably withheld." This obligation is also subject to applicable government ordinances and restrictive covenants, as well as the shopping center signage criteria attached as an exhibit to the lease. All signage requires the landlord's prior review and approval before fabrication and installation.

This clause provides some protection to the franchisee, ensuring they can display appropriate signage for their business. However, it's important to note that this protection is limited to signage and is also subject to external factors like local regulations and shopping center rules. The franchisee is also permitted to display signs and promotional items on the inside of the premises consistent with 1 800 Packouts's national standards.