Where in the Byrider franchise agreement can I find the definition of 'Royalty Fee', and on what page is it located?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
See Exhibit B for Franchisee's additional franchise category designation ("Additional Franchise Category")
- 3.9 Service Center. The term "Service Center" shall mean the service center located at the Business to service vehicles sold by Businesses in accordance with the Company's standards and specifications.
- 3.10 Royalty Fee. The Royalty Fee commencement date is the earlier of the date the Franchisee's Business is open to the public or the one-year anniversary of the date of this Agreement. The term "Royalty Fee" shall mean that amount calculated monthly as follows:
Gross Sales (Byrider Vehicle Sales):
- A. During the first year of operation of Franchisee's Business: $5,500 per month;
- B. During the second year of operation of Franchisee's Business: the greater of $6,700 per month or 1% of the Franchisee's Gross Sales (Byrider Vehicle Sales) for that month; and
- C. After the second year of operation of Franchisee's Business: the greater of $7,800 per month or 1% of the Franchisee's Gross Sales (Byrider Vehicle Sales) for that month.
The foregoing $7,800 minimum monthly payment provided in subsection (B) above will increase by 4.0% on January 1st of every other year (for example, it will increase by 4.0% on January 1, 2026 and increase by another 4.0% on January 1, 2028, etc.) throughout the Term (as defined in Section 5.1 below).
plus,
Gross Receipts (CNAC Collections):
After the first year of
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, the definition of 'Royalty Fee' can be found in Article III, Section 3.10 of the franchise agreement. This section is located on page 102. The Royalty Fee commencement date is the earlier of when the Franchisee's Business opens to the public or one year from the agreement date.
The Royalty Fee is calculated monthly and varies depending on the number of years the Byrider franchise has been in operation. During the first year, the fee is a fixed $5,500 per month. In the second year, it is the greater of $6,700 per month or 1% of Gross Sales (Byrider Vehicle Sales). After the second year, the fee becomes the greater of $7,800 per month or 1% of Gross Sales (Byrider Vehicle Sales).
The minimum monthly payment of $7,800 increases by 4.0% on January 1st of every other year, starting January 1, 2026. In addition to the above, after the first year of operation, a franchisee must pay 1.90% of Gross Receipts (CNAC Collections). However, if the franchisee operates at least two additional Byrider Businesses under separate agreements, and is in compliance with all agreements, the fee is reduced to 1.65% of Gross Receipts (CNAC Collections). Franchisees should be aware of these escalating royalty fees as they project their potential earnings.