What was the loss on extinguishment of debt for Del Taco in 2022?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
e letters of credit. As of September 29, 2024, we had $6.0 million in outstanding borrowings and had available borrowing capacity of $94.5 million, net of letters of credits issued of $49.5 million.
The net proceeds of the sale of the 2022 Notes were used to repay in full of $570.7 million in aggregate outstanding principal amount of the Company's Series 2019-1 Class A-2-I Notes, together with the applicable make-whole premium and unpaid interest, and was used to fund a portion of the Company's acquisition of Del Taco. As a result, the Company recorded a loss on early extinguishment of debt of $5.6 million during the second quarter of 2022, which
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 58)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, in 2022, the company recorded a loss on early extinguishment of debt of $5.6 million. This loss occurred during the second quarter of 2022.
The loss was a result of repaying $570.7 million in outstanding principal amount of the Company's Series 2019-1 Class A-2-I Notes. The loss of $5.6 million included the write-off of certain deferred financing costs and a specified make-whole premium payment. This expense is presented within "Interest expense, net" in the consolidated statement of operations.
For a prospective Del Taco franchisee, this information provides insight into the financial transactions and debt management of the parent company. While this specific loss does not directly impact the day-to-day operations of a franchise, it reflects the financial activities undertaken during the acquisition of Del Taco and the refinancing of debt. Understanding these financial aspects can help franchisees assess the overall financial health and stability of the Del Taco brand.