Is a Budget Licensee's failure to reasonably adhere to any provision cause for termination?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
Budget will have the right to terminate this Agreement for cause.
In addition to the grounds described in Paragraph 11.4, cause for termination will be Licensee's failure to reasonably adhere to any provision of this Agreement, including the Standards, and to cure any such failure within the notice period hereinafter prescribed.
Budget will not be limited to the reasons set forth in any notice of default or similar notice issued by Budget in any judicial proceeding in which the validity of the termination of this Agreement is at issue.
Any notice of default by Budget will specify the time period (if any) within which such failure or failures must be cured by Licensee, which Licensee agrees will be fifteen (15) days from the date of delivery of notice to Licensee in the case of all failures by Licensee to pay any sums owed to Budget and thirty (30) days from delivery in the case of failure of Licensee to adhere to any other provision of this Agreement or the Standards (except as otherwise set forth in Paragraph 11.4).
If Licensee fails to cure any such failure within the prescribed time period, this Agreement will terminate without further notice or action by Budget and upon expiration of the prescribed time period.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, Budget has the right to terminate the License Agreement if the licensee fails to reasonably adhere to any provision of the agreement, including the standards. However, the licensee has an opportunity to cure the failure within a prescribed notice period.
The notice of default issued by Budget will specify the time period within which the licensee must cure the failure. For failures to pay any sums owed to Budget, the cure period is fifteen (15) days from the date of delivery of the notice. For failures to adhere to any other provision of the agreement or the standards, the cure period is thirty (30) days from delivery of the notice, unless otherwise specified in Paragraph 11.4.
If the licensee fails to cure the failure within the prescribed time period, the License Agreement will terminate without further notice or action by Budget upon expiration of the cure period. This means that a Budget franchisee needs to be diligent in adhering to all aspects of the franchise agreement and correct any deficiencies promptly upon receiving notice to avoid termination of the agreement.