What was the net cash used in financing activities by Stretch Zone in 2023?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2023 | 2022 | |
|---|---|---|
| Cash flows from financing activities: | ||
| Debt issuance costs | (972,564) | - |
| Proceeds from term note | 40,000,000 | - |
| Contribution from member | 1,059,487 | - |
| Distributions to member and former member | (46,013,579) | (2,520,000) |
| Net cash used in financing activities | (5,926,656) | (2,520,000) |
Source: Item 3 — Franchisee/Debtor's Warranties. (FDD pages 263–364)
What This Means (2025 FDD)
According to Stretch Zone's 2025 Franchise Disclosure Document, the net cash used in financing activities in 2023 was $5,926,656. This figure reflects the overall cash flow impact from Stretch Zone's financing activities during that year.
Specifically, this amount is calculated from several components. These include debt issuance costs of $972,564, proceeds from a term note amounting to $40,000,000, a contribution from a member of $1,059,487, and distributions to members and former members totaling $46,013,579. The combination of these inflows and outflows determines the net cash used in financing activities.
For a prospective Stretch Zone franchisee, understanding these figures provides insight into how the company manages its finances and capital structure. It shows the extent to which Stretch Zone relies on debt, member contributions, and distributions, which can be useful in assessing the financial stability and practices of the franchisor. Reviewing these cash flow details can help potential franchisees evaluate the financial health and sustainability of Stretch Zone.