When are Dryject initial franchise fees considered fully earned?

According to Dryject's 2025 Franchise Disclosure Document, the initial franchise fees are billed and collected when the franchise agreement is signed. Dryject states that the entire initial fee is earned in full upon signing the agreement. However, the fees are recognized when all initial and substantial services of the franchise agreement have been performed and other material conditions or obligations related to substantial performance exist. Dryject evaluates each initial franchise fee at year end for any unfilled obligations and generally satisfies the conditions within 60 days of signing the agreement.

For prospective Dryject franchisees, this means that while the initial fee is collected upfront, Dryject doesn't fully recognize the revenue until they have fulfilled their obligations to help the franchisee get started. This is a fairly standard practice in franchising, as it aligns the franchisor's incentives with the franchisee's success.

However, there are addendums for franchisees in Maryland and Minnesota. For these states, all initial fees and payments are deferred until Dryject has fulfilled its initial pre-opening obligations and the franchise is open for business. This provides additional financial protection for franchisees in those states.