What condition must a Byrider franchisee meet to sell and assign retail installment contracts to unaffiliated third parties?

According to Byrider's 2025 Franchise Disclosure Document, a franchisee may sell and assign retail installment contracts to unaffiliated third parties if they meet certain conditions. First, the franchisee must obtain Byrider's approval of the third party, which Byrider will not unreasonably withhold. Second, the franchisee may not sell or assign retail installment contracts with contract values, in the aggregate, of more than 20% of the franchisee's Gross Sales 12-month rolling monthly average.

This means that a Byrider franchisee needs to get approval from Byrider for any third party they want to assign retail installment contracts to. This approval process is designed to ensure that the third party is reputable and capable of handling the contracts. Additionally, there is a limit on the total value of contracts that can be assigned to third parties, which is capped at 20% of the franchisee's average monthly gross sales over the previous year. This limitation likely aims to prevent franchisees from excessively relying on third-party assignments, which could potentially impact the financial stability of the franchise or the Byrider system.

It is important for prospective franchisees to understand these conditions, as they can impact the franchisee's ability to manage their finances and customer relationships. The franchisee also has to pay Byrider a Third Party Financed Sales Fee of $250 per contract sold or assigned at the time of the vehicle sale from the franchisee's dealer entity to the Third Party. Additionally, the franchisee must pay Byrider a Bulk Sale of Accounts Fee equal to 1.90% of gross amounts of Byrider-originated consumer retail installment contracts sold to a third party. Franchisees should carefully consider these fees and limitations when evaluating the financial viability of the franchise.