According to the Del Taco FDD, what is the purpose of Exhibit A?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
d:12)(cid:12)(cid:12)(cid:12) (cid:3)(cid:1)(cid:15)(cid:10)(cid:18)(cid:18)(cid:23)(cid:10)(cid:14)(cid:17)(cid:18)(cid:1) (cid:3)(cid:1)(cid:15)(cid:10)(cid:18)(cid:14)(cid:23)(cid:10)(cid:17)(cid:18)(cid:22)(cid:1) | | | The following map shall serve only as a general illustration of the area described above. In the event of any conflict between the foregoing description and the following map, the foregoing description shall control.
Developer is granted protected rights within the Development Area described in this Exhibit A, attached hereto and incorporated herein by this reference, as expressly set forth in the Development Agreement ("Agreement"); provided, however, that (i) such territorial protection will terminate in the event Developer fails to meet its obligations under this Agreement or any other agreement to develop restaurants within the Development Area; and (ii) Developer understands and acknowledges that certain locations within the Development Area are excluded from the Agreement as they may be more appropriately developed by Company, or by a company that specializes in institutional foodservice operations or has exclusivity rights or master lease rights. These locations include airports, the campuses of universities or colleges, hospitals, public transportation facilities, amusement parks, government facilities, malls, stadiums, or other sports facilities, and similarly situated sites and other "Alternative Points of Distribution" as defined in the Agreement. Notwithstanding any provision of the Agreement to the contrary, at any time, Del Taco may develop and operate, or franchise others to develop and operate, Del Taco restaurants at such sites whether or not the sites are located within the Development Area. The development and operation of such sites by Del Taco and/or other developers shall not constitute a violation of the Agreement.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, Exhibit A defines the Development Area granted to the Developer. The exhibit, which is attached to and incorporated into the Development Agreement, outlines the specific geographic region where the developer has certain protected rights to establish Del Taco restaurants. This means Del Taco will not establish or grant franchises to others within that area, giving the developer a degree of exclusivity. However, this protection is contingent on the developer meeting their obligations under the Development Agreement.
It's important to note that the territorial protection described in Exhibit A can terminate if the developer fails to meet their development obligations. Additionally, certain locations within the Development Area are excluded from the agreement and may be developed by Del Taco or other entities specializing in institutional foodservice operations. These locations include airports, university campuses, hospitals, transportation facilities, amusement parks, government facilities, malls, stadiums, and similar sites, referred to as "Alternative Points of Distribution."
Del Taco retains the right to develop or franchise others to develop Del Taco restaurants at these excluded sites, regardless of their location within the Development Area. If Del Taco allows the developer to build at one of these excluded sites, it will not count towards the developer's required development obligations. The FDD states that in the event of any conflict between the description of the development area and any map provided, the written description will take precedence.