What information and documentation related to a third-party offer must a Del Taco franchisee provide to Del Taco?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
- 12.6.1 If Franchisee or any owner desires to accept any bona fide offer from a third party to purchase Franchisee, all or substantially all of the assets of the Restaurant, or any direct or indirect interest in Franchisee, Franchise or such owner shall promptly notify Del Taco of such offer and shall provide such information and documentation relating to the offer as Del Taco may require. Del Taco shall have the right and option, exercisable within thirty (30) days after receipt of all such information, to send written notice to the seller that Del Taco intends to purchase the seller's interest on the same terms and conditions offered by the third party. If Del Taco elects to purchase the seller's interest, the closing on such purchase shall occur within sixty (60) days from the date of notice to the seller of the election to purchase by Del Taco.
- 12.6.2 Any material change in the terms of the bona fide offer prior to closing shall constitute a new offer subject to the same rights of first refusal by Del Taco as in the case of the third party's initial offer. Del Taco's failure to exercise the option afforded by this Section 12.6 shall not constitute a waiver of any other provision of this Agreement, including all of the requirements of this Section 12.6, with respect to a proposed transfer, or a waiver of any subsequent offer.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, if a franchisee receives a legitimate offer from a third party to purchase the franchise, its assets, or any interest in the franchise, the franchisee must promptly inform Del Taco of the offer. This notification must include providing Del Taco with any information and documentation related to the offer that Del Taco may require. This requirement ensures Del Taco has the opportunity to exercise its right of first refusal.
Del Taco has the option to purchase the franchisee's interest on the same terms and conditions as the third-party offer. Del Taco has 30 days after receiving all required information to notify the seller in writing of its intent to purchase the interest. If Del Taco decides to purchase the interest, the closing must occur within 60 days from the date Del Taco notifies the seller of its election to purchase.
Furthermore, any significant change to the terms of the offer before closing is considered a new offer, which is also subject to Del Taco's right of first refusal. Even if Del Taco chooses not to exercise its option to purchase the franchise at this time, it does not waive any other provisions of the agreement or its right to evaluate any subsequent offers.