If a Budget licensee undertakes a stock offering, what disclaimer must be included in all filings and offering documents regarding Budget's involvement?

According to Budget's 2025 Franchise Disclosure Document, if a licensee undertakes a stock offering, they must include a specific disclaimer in all filings and offering documents. This disclaimer must state that Budget (including its parents, affiliates, and subsidiaries) is not participating in, or in any way approving of, the underwriting or other accounting procedures utilized in the offering. This requirement ensures that potential investors understand that Budget is not endorsing or involved in the financial aspects of the licensee's stock offering.

This disclaimer is crucial for protecting Budget from any liability or misrepresentation related to the stock offering. By explicitly stating its non-involvement, Budget avoids any implication of guaranteeing the success or soundness of the licensee's financial endeavors. This is a standard practice in franchising, where franchisors want to maintain a clear separation between their brand and the individual financial activities of their franchisees.

For a prospective Budget franchisee, this requirement means that if they plan to raise capital through a stock offering, they must adhere to this disclaimer to maintain compliance with the franchise agreement. Failing to include this disclaimer could result in a breach of contract and potential legal repercussions. It is essential for franchisees to consult with legal and financial advisors to ensure all necessary disclosures and disclaimers are accurately included in their offering documents.