What are the specific obligations of a Byrider franchisee regarding the maintenance and security of the Proprietary Computer Software (Item 8) and how are these obligations listed in Item 9?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
CES OF PRODUCTS AND SERVICES**
A. Proprietary Computer Software and Starter Kit. You must license Byrider Franchising Partners' Proprietary Computer Software from Byrider Franchising Partners and enter into a Software Services and User Agreement (see Exhibit E attached to the Franchise Agreement) with Byrider Franchising Partners for ongoing service and support to the Proprietary Software and all other components of the technology system. Byrider Franchising Partners does not provide lease packages for its Proprietary Software but may provide you with a list of third parties that offer lease packages for the entire technology system as described in Item 11. Any financing you arrange for the purchase or lease of the technology system may not contain terms that encumber the Proprietary Software in any way. Under no circumstances will the ownership rights to the Proprietary Software change from Byrider Franchising Partners to you or to a third party.
You may also purchase a starter kit from Byrider Franchising Partners' approved suppliers for a cost of approximately $2,500. This kit is assembled to facilitate the start-up phase and general operation of your Business. The starter kit currently contains posters, menu boards, springboards, and other internal decorations.
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, franchisees have specific obligations regarding the maintenance and security of the Proprietary Computer Software. Item 8 states that franchisees must license Byrider's Proprietary Computer Software and enter into a Software Services and User Agreement for ongoing service and support. Franchisees cannot encumber the Proprietary Software through financing arrangements, and ownership of the software remains with Byrider. Franchisees are required to maintain a secure environment with regular patching of Operating Systems and software. They may also be required to periodically update technology to match current standards. Byrider will assist in the installation of the Proprietary Software. Item 11 also mentions that Byrider Franchising Partners maintains specific standards for networks, security, software, and hardware that all franchisees must comply with.
Item 11 outlines that franchisees are responsible for acquiring, installing, and maintaining all technology at their location, including a stable, business-class internet connection. Byrider will provide VPN client access for a fee per user. Franchisees must also license and use the Byrider technology system necessary to operate their business, paying the costs to the appropriate vendor as shown on Exhibit D, Appendix B. Exhibit D, Appendix A, identifies the items typically required per franchised location, with potential substitutions allowed at Byrider's discretion if they do not materially impact service or support.
Upon termination or expiration of the Franchise Agreement, the Software Agreement also terminates, and Byrider is no longer obligated to provide access to the BYRIDER Computer Software, according to Article 17.2. However, Byrider will provide the franchisee with information needed to collect receivables and wind down the business. Article 17.1(B) states that upon termination, the franchisee must promptly return to Byrider the Manual and other confidential materials, including all the BYRIDER Computer Software.
While the FDD excerpts detail the franchisee's obligations to license, maintain, and secure the proprietary software, the excerpts do not specifically list these obligations within Item 9. A prospective franchisee should review the full FDD and specifically ask Byrider for clarification on where these obligations are detailed within Item 9, as the provided excerpts do not contain this information.