How does the Dryject franchisor's definition of the business relationship (Item 8) affect the franchisee's initial investment (Item 7)?
Dryject Franchise · 2025 FDDAnswer from 2025 FDD Document
The Franchise Disclosure Document for DryJect Management, LLC offering franchises under the "DryJect®" mark for use in the State of Maryland shall be amended as follows:
Item 5, "Initial Fee" shall be amended by the addition of the following paragraph:
Based upon the franchisor's financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until the franchisor completes its pre-opening obligations under the franchise agreement.
Item 17(v), "Choice of Forum", shall be amended by adding the following paragraph:
Section 4-216(c)(25) of the Maryland Franchise Registration and Disclosure Law requires a franchisor to file an irrevocable consent to be sued in Maryland. A franchisee may bring a lawsuit in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
Any claims arising under the Maryland Franchise Registration and Disclosure law must be brought within three years after the franchise is granted.
No statement, questionnaire, or acknowledgment signed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT FOR DRYJECT MANAGEMENT, LLC
STATE OF MINNESOTA
- Item 5 "Initial Fee" is amended by the addition of the following paragraph:
"All initial fees and payments shall be deferred until such time as the franchisor has fulfilled its initial pre-opening obligations and the franchise is open for business."
- Item 13 is amended to add the following:
DRYJECT MANAGEMENT, LLC will protect your right to use the DryJect® Mark and Trade Name or will indemnify you against any loss, costs, or expenses arising out of any claim, suit, or demand regarding your use of the Marks or Trade Name.
What This Means (2025 FDD)
According to Dryject's 2025 Franchise Disclosure Document, Item 8, concerning the business relationship, has specific addenda for franchisees in Maryland and Minnesota that directly affect the initial fees outlined in Item 5. For these states, the initial franchise fees and payments are deferred until Dryject has fulfilled its pre-opening obligations and the franchise is open for business. This amendment is based on the franchisor's financial condition, as required by the Maryland Securities Commissioner.
This deferral of initial fees provides a significant benefit to franchisees in Maryland and Minnesota. It reduces the upfront financial burden, allowing franchisees to conserve capital until the business is operational. This can be particularly helpful in managing cash flow during the initial setup phase, as franchisees won't have to pay the franchise fee until they are ready to open.
For prospective Dryject franchisees in Maryland and Minnesota, this deferral represents a considerable advantage. However, it's crucial to understand the specific pre-opening obligations that Dryject must fulfill before the fees become due. Franchisees should also confirm the details of this deferral with Dryject to ensure they fully understand the terms and conditions. This addendum does not apply to franchisees outside of Maryland and Minnesota, so they will need to adhere to the standard initial fee payment schedule.
The FDD also stipulates that Dryject will protect the franchisee's right to use the DryJect mark and trade name, or indemnify them against any losses, costs, or expenses arising from claims related to the use of the marks or trade name. This protection is particularly relevant in Minnesota, as it is explicitly mentioned in the addendum. This indemnity offers additional security to franchisees, ensuring they are not financially burdened by legal issues related to the brand's intellectual property.