What is the Development Fee for a Stretch Zone Area Development Agreement to develop 2 Franchise Businesses?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
n Program. If you are an honorably discharged veteran and you meet our qualifications for purchasing a Franchise Business, for your first Franchise Business only, we will discount our standard Initial Franchise Fee by 10% (a discount of $5,950). Under these circumstances, the Initial Franchise Fee for that Franchise Business will be $53,550.
DEVELOPMENT FEE
We also offer to certain qualified persons rights to develop 2 or more Franchise Businesses within a Development Area under a Stretch Zone Area Development Agreement. In consideration of the Area Development Rights we grant to you, you will pay to us a Development Fee based on the number of Franchise Businesses you commit to developing. To develop 2 Franchise Businesses, the Development Fee is $119,000, representing the Initial Franchise Fees for both Franchise Businesses. To develop 3 Franchise Businesses, the Development Fee is $148,750, representing the Initial Franchise Fees for the first 2 Franchise Businesses and 50% of the Initial Franchise Fee for the 3rd Franchise Business. When you sign the Franchise Agreement for your 3rd Franchise Business, you must pay the remaining 50% of the Initial Franchise Fee for the 3rd Franchise Business. To develop 4 Franchise Businesses, the Development Fee is $178,500, representing the Initial Franchise Fees for the first 2 Franchise Businesses and 50% of the Initial Franchise Fees for the 3rd and 4th Franchise Businesses. When you sign the Franchise Agreement for each of your 3rd and 4th Franchise Businesses, you must pay the remaining 50% of the Initial Franchise Fee for the applicable Franchise Business. To develop 5 Franchise Businesses, the Development Fee is $238,000, representing the Initial Franchise Fees for the first 3 Franchise Businesses and 50% of the Initial Franchise Fees for the 4th and 5th Franchise Businesses. When you sign the Franchise Agreement for each of your 4th and 5th Franchise Businesses, you must pay the remaining 50% of the Initial Franchise Fee for the applicable Franchise Business. To develop 6 Franchise Businesses, the Development Fee is $267,750, representing the Initial Franchise Fees for the first 3 Franchise Businesses and 50% of the Initial Franchise Fee for the 4th, 5th and 6th Franchise Businesses. When you sign the Franchise Agreement for each of your 4th, 5th and 6th Franchise Businesses, you must pay the remaining 50% of the Initial Franchise Fee for the applicable Franchise Business. To develop 7 or more Franchise Businesses, generally, the Development Fee is equal to (a) 100% of the Initial Franchise Fees for 50% of the number of Franchise Businesses to be developed under the Area Devel
Source: Item 4 — ITEM -4 BANKRUPTCY (FDD pages 15–16)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the Development Fee for an Area Development Agreement to develop 2 franchise businesses is $119,000. This fee represents the combined Initial Franchise Fees for both businesses.
This means that if a prospective franchisee wants to secure the rights to develop two Stretch Zone locations within a specific area, they must pay $119,000 upfront. This fee is not just a deposit; it covers the full Initial Franchise Fees for both locations. The FDD specifies that this fee is fully earned by Stretch Zone upon signing the Area Development Agreement.
It's important for potential Area Developers to understand that this $119,000 is non-refundable. This is a common practice in franchising, as the fee compensates the franchisor for granting exclusive development rights and providing initial support. Franchisees should carefully consider their financial capacity and commitment to developing multiple locations before entering into an Area Development Agreement with Stretch Zone.