What documents related to financing must a buyer provide to the seller for Del Taco franchise approval?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
- The following shall constitute conditions precedent to Seller's obligations under this Agreement. Seller shall determine, in its sole discretion, whether such conditions have been satisfied as of the Closing Date. In the event Seller does not waive any of the conditions set forth below prior to the Closing Date, this Agreement shall terminate, and the parties shall have no further obligations hereunder.
- (i) Seller shall have reviewed and approved Buyer's loan term sheets and(or) commitment letters, and such other information as may be reasonably requested by Seller, in its sole discretion, to determine Buyer's ability to obtain financing sufficient to complete the transaction contemplated in this Agreement. Buyer shall cooperate with Seller in connection with the foregoing condition by promptly providing to Seller any and all such documents and information requested by Seller.
- (ii) The terms and provisions of this transaction shall have been approved by Seller's executive management.
- (iii) Seller shall have reviewed and approved Buyer's financial status and liquidity, including, without limitation, Buyer's bank statements, financial statements, loan term sheets and(or) commitment letters, and such other information as may be requested by Seller, in its sole discretion, to determine Buyer's financial capability to complete the transaction contemplated in this Agreement. Buyer shall cooperate with Seller in connection with the foregoing condition by promptly providing to Seller any and all such documents and information requested by Seller.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, a prospective buyer must provide certain financial documents to the seller for approval. Specifically, the seller needs to review and approve the buyer's loan term sheets and/or commitment letters. The seller may also request other information to assess the buyer's ability to obtain sufficient financing to complete the transaction.
In addition to financing-related documents, the seller will also evaluate the buyer's overall financial status and liquidity. This includes reviewing bank statements and financial statements. Again, the seller may request additional information to determine the buyer's financial capability to complete the transaction.
The buyer is obligated to cooperate with the seller by promptly providing all requested documents and information. The seller has sole discretion in determining whether these conditions have been met as of the closing date. If the seller does not waive any of these conditions before the closing date, the agreement may be terminated, and neither party will have further obligations.
This requirement ensures that prospective Del Taco franchisees have the financial resources necessary to complete the purchase of a franchise. It protects both the seller and the Del Taco brand by verifying the buyer's financial stability and ability to manage the business effectively. Prospective buyers should be prepared to provide comprehensive financial documentation to facilitate the approval process.