What is Budget's responsibility regarding agreements, representations, or warranties made by the Budget licensee to any person?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) Licensee an Independent Contractor. Licensee is an independent contractor and is not the agent, joint venture participant, partner or employee of Budget and, except as expressly provided herein, Budget will not be obligated by any agreements, representations or warranties made by Licensee to any person, nor with respect to any other action of Licensee, nor will Budget be obligated for any damages to any person, whether caused by Licensee's action, failure to act, negligence, or willful conduct. No modification of this Agreement shall be binding upon either party unless and until the same has been made in writing and duly executed by both parties. Notwithstanding the preceding sentence, Licensee understands and agrees that Budget may unilaterally issue new (or amend or modify existing) Standards, operating procedures, policies and guidelines in the Manual pertaining to the System.
- (b) Budget Does Not Control Licensee. Budget does not reserve any control over Licensee or any of its owners, officers or employees, except as herein provided with reference to the requirement that Licensee comply with the provisions of this Agreement and the Standards, nor will Budget have any control over the employment, discharge, compensation or working conditions of any owner, director or employee of Licensee.
- EXHIBIT H 14.4 Cross Defaults. Licensee agrees that its compliance with the terms of all airport concession agreements, voluntary participation agreements and other agreements signed by Licensee with Budget, including other license agreements, Programs (whether signed agreements
or as part of the Standards) and any of the Related Entities are essential to this Agreement and a default under any of these agreements and/or Programs will be a default under and breach of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, Budget licensees operate as independent contractors. As such, Budget is not bound by any agreements, representations, or warranties that a licensee makes to any person. This means that franchisees are solely responsible for their own actions and obligations.
This independence extends to the licensee's business operations. Budget does not exert control over the licensee, their owners, officers, or employees, except to ensure compliance with the franchise agreement and the brand's standards. This includes decisions related to employment, compensation, and working conditions within the franchise.
However, licensees must adhere to all airport concession agreements, voluntary participation agreements, and other agreements signed with Budget or its related entities. A default on any of these agreements constitutes a default and breach of the franchise agreement. This clause highlights the importance of fulfilling all contractual obligations with Budget and related parties to maintain good standing as a franchisee.