Can Budget run background and credit checks on the Budget licensee's officers, directors, and managers?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
Licensee shall notify Budget of the names and addresses of all of Licensee's officers, directors and managers.
Licensee shall notify Budget immediately in the event changes in any such positions occur, including providing Budget with organizational documents executed to effect or approve such change, as set forth in Exhibit G.
Budget reserves the right to periodically run criminal background checks and credit checks on any of Licensee's officers, directors and managers, including at the time of renewal.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, Budget retains the right to conduct background and credit checks on the licensee's officers, directors, and managers. This includes the ability to perform these checks periodically and at the time of renewal.
This provision allows Budget to ensure that individuals in leadership positions within the franchise meet certain standards of financial responsibility and do not have a criminal history that could negatively impact the brand. Licensees are required to notify Budget of the names and addresses of all officers, directors, and managers, as well as any changes in these positions, along with the relevant organizational documents.
For a prospective franchisee, this means that Budget will likely scrutinize the backgrounds of key personnel. It is important to ensure that all officers, directors, and managers are aware of this policy and are prepared to undergo these checks. Failure to comply with this requirement or the discovery of adverse information could potentially affect the franchise agreement or renewal.