Under what conditions will Budget hold a licensee responsible for damage or expense related to equipment?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) If Licensee fails to install, maintain, implement and observe the Controls as mandated by ABCR in written procedures, Licensee will be in material breach of the Rental System Agreement, the License Agreement and responsible for any resulting damage or expense incurred by ABCR and the System.
Licensee will be responsible for the expense required to correct any non-conformity of Licensee's Equipment or communication systems employed by Licensee with the System, including non-PCI compliance.
As a result of any such material breach, Licensee will be suspended from network access until the failure is remedied to ABCR'S satisfaction.
If any such failure happens more than twice within any one-year period, ABCR may also, at its discretion, suspend permanently Licensee's connection to the System via the Internet, and require Licensee to follow dedicated connection procedures at Licensee's expense as provided in the Rental System Agreement.
(d) Licensee will be responsible for any damage suffered by ABCR and/or the System as a result of unauthorized access, use or code or file transmission from Licensee's Equipment during any period in which the Controls are not in place on Licensee's Equipment.
(e) Licensee is responsible for the actions of all of its authorized users who have access to Licensee's Equipment at Licensee's locations, regardless of the location of the persons or the means by which such persons access the Equipment.
This responsibility exists regardless of the security mechanisms that are in place.
This responsibility also extends to actions taken by persons who are not authorized to (i) use Licensee's Equipment but who use Licensee's Equipment while physically located at one of Licensee's locations or (ii) access the System remotely but nevertheless have such access due to Licensee's intentional or negligent act or omission.
Licensee is expected to employ the Controls available, and commercially reasonable security mechanisms and procedures including those specified herein.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, a licensee can be held responsible for damage or expenses related to equipment under specific circumstances. If the licensee fails to install, maintain, implement, and observe the controls mandated by Budget in written procedures, this constitutes a material breach of the Rental System Agreement and the License Agreement. Consequently, the licensee will be responsible for any resulting damage or expense incurred by Budget and the System. This includes expenses required to correct any non-conformity of the licensee's equipment or communication systems with the System, including non-PCI compliance.
As a result of such a material breach, Budget may suspend the licensee's network access until the failure is remedied to Budget's satisfaction. Furthermore, if the same failure occurs more than twice within a one-year period, Budget has the discretion to permanently suspend the licensee's connection to the System via the Internet and require the licensee to follow dedicated connection procedures at the licensee's expense, as outlined in the Rental System Agreement.
The licensee is also responsible for any damage suffered by Budget and/or the System as a result of unauthorized access, use, or code or file transmission from the licensee's equipment during any period in which the controls are not in place on the licensee's equipment. This responsibility extends to the actions of all authorized users who have access to the licensee's equipment at the licensee's locations, regardless of their physical location or the means by which they access the equipment. This responsibility also extends to actions taken by unauthorized persons who use the licensee's equipment while physically located at one of the licensee's locations or who access the System remotely due to the licensee's intentional or negligent act or omission. The licensee is expected to employ the available controls and commercially reasonable security mechanisms and procedures, including those specified by Budget.