What are the conditions under which each provision of the Rider to the Budget License Agreement becomes effective?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
| This Rider is made and entered into this day of , |
|---|
| , by and between Budget Rent A Car System, Inc., a Delaware corporation ("Budget"), |
| 20 |
| and |
| d/b/a Budget Rent A Car of |
| ("Licensee"). |
| 1. |
| Background. Budget |
| and Licensee |
| are |
| parties |
| to |
| that |
| certain "License |
| Agreement" dated |
| , 20 |
| that has been executed concurrently |
| with the execution of this Rider. This Rider is annexed to and forms part of the License |
| Agreement. This Rider is being executed because (a) the Budget Franchise that Licensee will |
| operate under the License Agreement is located in the State of Minnesota; and/or (b) any of the |
| offering or sales activity with respect to the License Agreement occurred in the State of |
| Minnesota. Each provision of this Rider will be effective only to the extent, with respect to such |
| provision, that the jurisdictional requirements of the Minnesota Franchise Act and its regulations |
| are met independently without reference to this Rider. |
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the Rider to the Budget License Agreement is executed because the franchise is located in Minnesota, or any offering or sales activity occurred in Minnesota. Each provision of the Rider will be effective only to the extent that the jurisdictional requirements of the Minnesota Franchise Act and its regulations are met independently without reference to the Rider.
In simpler terms, this means that if you are opening a Budget franchise in Minnesota, or if any part of the franchise sales process took place there, a Rider is added to your License Agreement. However, the Rider's provisions only apply if they independently comply with Minnesota's franchise laws, regardless of what the Rider itself says.
This ensures that Budget complies with Minnesota state law. A prospective franchisee should consult with a legal expert to ensure full compliance.