What is the definition of 'Rental Business' according to the Budget franchise agreement?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
In connection with the license granted to Licensee hereunder, the term "Rental Business" is defined exclusively as the business of renting and leasing Vehicles and such other vehicles, without drivers, as may be approved by Budget in writing, for a period not to exceed one hundred and eighty (180) days under the Marks and the System, and does not include or refer to the rental, lease or sharing of any other vehicle or product or to any other business or commercial activity, including any business engaged in the sale of new or used vehicles or the rental, lease or sharing of any type of vehicle not authorized by Budget.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the term "Rental Business" is specifically defined within the context of the franchise agreement. It is defined as the business of renting and leasing vehicles, as well as other vehicles approved in writing by Budget, without drivers, for periods not exceeding 180 days. This operation must be conducted under the Budget Marks and System.
This definition explicitly excludes the rental, lease, or sharing of any other vehicle or product not authorized by Budget. It also excludes any other business or commercial activity, including the sale of new or used vehicles, or the rental, lease, or sharing of any type of vehicle not specifically authorized by Budget. This means a franchisee's operations must strictly adhere to the approved vehicle rental model and cannot deviate into unauthorized areas without explicit permission.
This narrow definition is important for prospective franchisees as it sets clear boundaries for their business operations. Franchisees must ensure their business activities align with this definition to remain compliant with the franchise agreement. Any deviation could potentially lead to a breach of contract and subsequent penalties or termination of the franchise agreement.