How is the Ultra2 Royalty Fee calculated for a Byrider franchise during the second year of operation?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
ITEM 6
OTHER FEES
| Name of Fee 1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Ultra2 Royalty Fee | $5,500-$7,800 plus 1.65%-1.90% Gross Receipts | Monthly | Gross Sales (Byrider Vehicle Sales): (i) during first year of operation of the Business, $5,500 per month; (ii) during second year of operation of the Business, the greater of $6,700 or 1% of Gross Sales (Byrider Vehicle Sales); and (iii) after second year of operation of Business, the greater of $7,800 or 1% of Gross Sales (Byrider Vehicle Sales). See Note 2. |
| Gross Receipts (CNAC Collections): After the first year of operation of the Business, 1.90% of your Gross Receipts (CNAC) throughout the remaining term of the Franchise Agreement, except, if you're signing your third (or more) Franchise Agreement, you will pay 1.65% of your Gross Receipts (CNAC Collections), so long as you are in compliance with all Franchise Agreements with Byrider Franchising, Partners and you continue to operate at least two additional Byrider Businesses that are open to the public. If you fail to meet these conditions, you will pay 1.90% for the remaining term of your third (or mo |
Source: Item 6 — Other Fees (FDD pages 21–32)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, the Ultra2 Royalty Fee calculation for a franchise in its second year of operation involves two components related to Gross Sales (Byrider Vehicle Sales) and Gross Receipts (CNAC Collections).
During the second year, the franchisee must pay the greater of $6,700 or 1% of Gross Sales (Byrider Vehicle Sales). This means Byrider will assess the franchisee's gross sales from vehicle sales and calculate 1% of that amount. If the result is greater than $6,700, the franchisee pays that percentage amount. However, if 1% of gross sales is less than $6,700, the franchisee must pay the minimum amount of $6,700.
In addition to the above, the franchisee must also pay 1.90% of Gross Receipts (CNAC) after the first year of operation. However, if the franchisee is signing their third (or more) Franchise Agreement, they will pay a reduced rate of 1.65% of Gross Receipts (CNAC Collections), provided they are in compliance with all Franchise Agreements with Byrider Franchising Partners and operate at least two additional Byrider Businesses open to the public. Failure to meet these conditions results in the franchisee paying the higher 1.90% rate. These fees are paid monthly.