What was the UAR expense for Stretch Zone for the year ending December 31, 2022?
Stretch_Zone Franchise · 2025 FDDAnswer from 2025 FDD Document
| $ 8,159,875 |
|---|
Statements of Operations
Year Ended December 31,
| December 31, | |||
|---|---|---|---|
| 2023 | 2022 | ||
| Revenues: | |||
| Royalties | $ 6,249,900 | $ 4,723,154 | |
| Franchise and ADA fees | 1,563,002 | 911,918 | |
| Media fund | 2,063,598 | 1,497,709 | |
| Equipment | 339,535 | 364,423 | |
| Training | 436,917 | 352,917 | |
| Technology | 1,098,504 | 611,550 | |
| Miscellaneous | 140,480 | 128,862 | |
| Total revenues | 11,891,936 | 8,590,533 | |
| Operating expenses | 9,172,888 | 7,690,543 | |
| Other expense: | |||
| UAR expense | (12,466,993) | (17,897,523) | |
| Interest expense | (3,9 |
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 UAR (Unit Appreciation Rights) expense for the year ending December 31, 2022, was ($17,897,523). This figure represents a significant expense for Stretch Zone during that period.
For a prospective franchisee, understanding the UAR expense is crucial as it reflects a portion of Stretch Zone's overall financial obligations and can impact the company's profitability. This expense may be tied to specific events, such as the change in ownership that occurred in 2023, which triggered payments related to unit appreciation rights.
It is important for potential franchisees to investigate the nature of UAR expenses, how they are accounted for, and whether similar expenses are expected in the future. Understanding these factors will provide a clearer picture of the financial health and stability of Stretch Zone.