What happens if a Byrider franchisee is not in compliance with all Franchise Agreements?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
| $13,431 per month | | |
However, if you or your affiliate(s) have signed a Franchise Agreement prior to January 1, 2021 and would otherwise qualify for the Traditional Royalty Fee, you may elect (if you have not already previously elected) to pay the Multi-Location Flat Rate ("MLFR"), so long as each of your (or your affiliates') Byrider businesses have at least 51% in common equity ownership and voting control. You (and your affiliates) must continue to operate at least two Byrider Businesses and remain in compliance with all franchise agreements and all other agreements with Byrider Franchising Partners (or its affiliate) to maintain the MLFR option. If you no longer qualify for the MLFR, you (and your affiliates) will revert to paying the Traditional Royalty Fee. The MLFR is calculated as follows:
| Number of Byrider Franchised Locations | Founder Franchisee | Legacy Founder Franchisee or Interim Founder Franchisee | Legacy Interim Founder Franchisee or Standard Franchisee |
|---|---|---|---|
| 1 | $8,954.00 | $11,192.00 | $12,312.00 |
| 2 | $8,954.00 | $11,192.00 | $11,192.00 |
| 3 | $8,954.00 | $10 |
Source: Item 6 — Other Fees (FDD pages 21–32)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, non-compliance with franchise agreements can have specific repercussions for franchisees electing to pay the Multi-Location Flat Rate (MLFR). Specifically, if a Byrider franchisee (or their affiliates) has at least 51% common equity ownership and voting control across their Byrider businesses and chooses the MLFR option, they must remain in compliance with all franchise agreements and other agreements with Byrider Franchising Partners to maintain this option.
If a Byrider franchisee no longer qualifies for the MLFR due to non-compliance, they (and their affiliates) will revert to paying the Traditional Royalty Fee. This means the franchisee will lose the flat-rate benefit and instead be subject to the standard royalty fee structure, which may be higher depending on their specific circumstances and category designation.
Beyond the MLFR implications, if an audit reveals a discrepancy showing that a Byrider franchisee underpaid Byrider Franchising Partners by more than 2%, and Byrider Franchising Partners concludes that the underpayment was intentional or grossly negligent, the franchisee must promptly pay Byrider Franchising Partners an amount equal to 3 times the Royalty Fees and/or the Advertising Fees that are due. The franchisee will also be responsible for interest at the highest rate allowed by law and all costs and expenses related to the audit, including salaries, travel costs, room and board, and travel fees for Byrider representatives.