Under what circumstances is the Rider to the License Agreement executed between Budget and the Licensee?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
NFIDENTIALITY AGREEMENT REQUIRED BY THE STATE OF MINNESOTA
| ("PROSPEC | CTIVE LICENSEE"). | |---------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | certain "Con | Background. BUDGET and PROSPECTIVE LICENSEE are parties to that fidentiality License Agreement" dated | | executed cor | | | of the Confid | | | that PROSPE | | | be located in | | | License Agre | | | will be effe | | | 2. | Injunctive Relief . The second sentence of Paragraph 5 of the Confidentiality is deleted in its entirety and the following is substituted in its place: | | Agreement | DGET will be entitled to seek injunctive relief without bond to enjoin any all or threatened conduct in violation of this Agreement." | | 3. | Law and Jurisdiction . The following language is added to the end of of the Confidentiality Agreement: | | Paragraph 7 | | | shall | rsuant to Minn. Stat. '80C.21 and Minn. Rule Part 2860.4400J, this section I not in any way abrogate or reduce PROSPECTIVE LICENSEE's rights as rided in Minnesota Statutes, 1984, Chapter 80C, including any right to submit ters to the jurisdiction of the courts of Minnesota." | | prov | | IN WITNESS WHEREOF, the parties hereto have executed and delivered this Rider on the day and year first above written.
PROSPECTIVE LICENSEE
| By: Its: | ||
|---|---|---|
| Accepted and Acknowledged: | ||
| BUDGET RENT A CAR SYSTEM, INC. | ||
| By: | ||
| Its: |
RIDER TO BUDGET RENT A CAR SYSTEM LICENSE AGREEMENT REQUIRED BY THE STATE OF MINNESOTA
| This Rider is made and entered into this day of , |
|---|
| , by and between Budget Rent A Car System, Inc., a Delaware corporation ("Budget"), |
| 20 |
| and |
| d/b/a Budget Rent A Car of |
| ("Licensee"). |
| 1. |
| Background. Budget |
| and Licensee |
| are |
| parties |
| to |
| that |
| certain "License |
| Agreement" dated |
| , 20 |
| that has been executed concurrently |
| with the execution of this Rider. This Rider is annexed to and forms part of the License |
| Agreement. This Rider is being executed because (a) the Budget Franchise that Licensee will |
| operate under the License Agreement is located in the State of Minnesota; and/or (b) any of the |
| offering or sales activity with respect to the License Agreement occurred in the State of |
| Minnesota. |
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the Rider to the License Agreement is executed under specific circumstances related to the location and legal requirements of certain states. For franchisees operating in Illinois, the Rider is executed if the franchisee is a resident of Illinois, or if the Budget franchise will be located within Illinois, and the offering or sales activity related to the License Agreement occurred or will occur in Illinois. The terms of the Rider are only effective if the jurisdictional requirements of the Illinois Franchise Disclosure Act are independently met, without relying on the Rider itself.
Similarly, for franchisees operating in Minnesota, the Rider is executed if the Budget franchise will be located in Minnesota, or if any of the offering or sales activity related to the License Agreement occurred in Minnesota. As with Illinois, the provisions of the Rider are only effective if the jurisdictional requirements of the Minnesota Franchise Act and its regulations are independently satisfied, without reference to the Rider.
In essence, the Rider serves to ensure compliance with state-specific franchise laws. It appears that Budget uses this mechanism to tailor the standard License Agreement to meet the legal requirements of states like Illinois and Minnesota, where franchise laws may have specific provisions that need to be addressed separately. This approach allows Budget to maintain a more uniform License Agreement while still adhering to varying state regulations, which is a common practice in franchising to manage legal complexities across different jurisdictions.