What is Byrider Franchising Partners' obligation regarding advertising plans and materials for franchisees?

uirements, Guidance and Approval. Periodically Byrider Franchising Partners provides you with advertising plans, materials and advice on advertising, promotional and public relations matters. (Franchise Agreement Article 6.9 E).

In addition, Byrider Franchising Partners has the right to approve or disapprove of all advertising and promotional materials you propose to use. (Franchise Agreement - Article 10.1) Advertising is explained in more detail below.

• 1. Annual Meetings. Byrider Franchising Partners holds one to three annual meetings at which you must be represented. Byrider Franchising Partners notifies you of the dates and locations of these meetings, and you are responsible for your own transportation and traveling expenses and your pro rata share of the meeting expenses that are associated with attending these meetings, which typically ranges between $599 and $1,499 for each meeting. Byrider Franchising Partners reserves the right to increase or decrease the number of meetings. (Franchise Agreement Article 6.11).
• C. Advertising Funds. Advertising through your efforts is placed in television, radio, magazine and newspaper media. You will participate in advertising in local and regional areas. In the future, Byrider Franchising Partners may establish, maintain and administer a National Advertising Fund to expand advertising efforts to national coverage. When and if Byrider Franchising Partners creates this fund, you must contribute to the fund as required by Byrider Franchising Partners. However, your contributions to any National Advertising Fund (if established) and your Local Advertising Requirement (as defined below) will not collectively exceed 4% of your Gross Sales (Byrider Vehicle Sales) (collectively, the "Advertising Spend Cap").

Your required payment of the Advertising Fees to Byrider Franchising Partners, as provided in Item 6, is excluded from the Advertising Spend Cap. These funds are typically spent to produce advertising materials. These funds are not used to place advertisements in any given market. Byrider Franchising Partners may increase the monthly contribution, but such increase(s) will not exceed $400.00 in the aggregate during any 24-month period.

In 2023, the advertising expenditures were as follows: Production (31.7% of funds); and Administrative Expenses (68.3% of funds). Byrider Franchising Partners is not required to spend any particular amount on advertising in your area or territory. Any fees that are not spent in the year that they are contributed to Byrider Franchising Partners are carried over to the next year. No part of the Advertising Fees is used to solicit franchise sales.

Source: Item 11 — (FDD pages 42–50)