What determines whether a franchisee is considered an 'Ultra Franchisee' when purchasing a Byrider franchise?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
opment Agreement Rider. If you are granted the right to purchase additional franchises, you must sign the applicable Area Development Agreement Rider. If you or your affiliate(s) have signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021 for at least one Byrider Business, and you are otherwise in compliance with that agreement and all other franchise agreements with Byrider Franchising Partners, you will be considered a "Traditional Franchisee." If you or your affiliate(s) have not signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021 for at least one Byrider Business, then you will be considered a "Ultra Franchisee." If you are a Traditional Franchisee, you will sign the Traditional Area Development Agreement Rider, attached to this disclosure document as Exhibit C-1 (the "Traditional Area Development Agreement"), or if you are an Ultra Franchisee, you will sign the Ultra Area Development Agreement Rider, attached to this disclosure document as Exhibit C-2 (the "Ultra Area Development Agreement").
Under the Traditional Area Development Agreement, you must pay us a development fee of $17,500 multiplied by the number of Byrider Businesses to be developed under the Development Schedule in addition to the first Byrider Business. Under the Ultra Area Development Agreement, you must pay us a development fee of $20,000 multiplied by the number of Byrider Businesses to be developed under the Development Schedule in addition to the first Byrider Business. The applicable development fee is due and payable at the time you sign the respective Area Development Agreement. We credit the development fee, in $17,500 (for Traditional Franchisees) or $20,000 (for Ultra Franchisees) increments, against the respective initial franchise fee that is due as Franchise Agreements are signed until the aggregate amount of such credits equals the initial development fee you paid to us under the respective Area Development. We will fully earn the development fee due under the respective Area Development Agreement when paid, and you must pay us the development fee in one lump sum.
Source: Item 5 — Initial Fees (FDD pages 19–21)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, whether a franchisee is considered a "Traditional Franchisee" or an "Ultra Franchisee" depends on their prior franchise agreement history with Byrider. Specifically, if the franchisee or their affiliate(s) had signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021, for at least one Byrider Business, and are in compliance with all agreements, they are classified as a "Traditional Franchisee."
Conversely, if the franchisee or their affiliate(s) had not signed a Franchise Agreement with Byrider Franchising prior to January 1, 2021, for at least one Byrider Business, they are classified as an "Ultra Franchisee." This distinction is important because it determines which Area Development Agreement Rider they will sign: either the Traditional Area Development Agreement Rider or the Ultra Area Development Agreement Rider. These riders, attached as exhibits to the FDD, outline the terms for purchasing additional franchises.
The classification also affects the development fees and initial franchise fees for additional franchises. Under the Traditional Area Development Agreement, the development fee is $17,500 multiplied by the number of Byrider Businesses to be developed, while under the Ultra Area Development Agreement, it is $20,000 multiplied by the number of businesses. Similarly, the initial franchise fee for each additional franchise is $35,000 for Traditional Franchisees and $40,000 for Ultra Franchisees. These fees are subject to change at Byrider's discretion without prior notice.
Therefore, a prospective franchisee should determine their status (Traditional or Ultra) based on their prior agreement history with Byrider, as this status impacts the fees associated with expanding their franchise operations. Understanding this distinction is crucial for financial planning and assessing the overall investment required for multi-unit development.