What costs and expenses are included in the indemnification that the undersigned agrees to cover for Del Taco?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
The undersigned each hereby jointly and severally agree to defend, indemnify and hold Del Taco harmless against any and all losses, damages, liabilities, costs, and expenses (including, but not limited to, reasonable attorney's fees, reasonable costs of financial and other investigation, court costs, and fees and expenses) resulting from, consisting of, or arising out of or in connection with any failure by Franchisee to perform any obligation of Franchisee under the Agreement, any amendment thereto, or any other agreement executed by Franchisee referred to therein.
Source: Item 22 — CONTRACTS (FDD pages 58–59)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the undersigned agrees to defend, indemnify, and hold Del Taco harmless against various financial burdens. These include any and all losses, damages, liabilities, costs, and expenses. The expenses covered encompass reasonable attorney's fees, reasonable costs of financial and other investigations, court costs, and associated fees. This indemnification is applicable when these financial burdens result from, consist of, or arise out of any failure by the franchisee to fulfill their obligations under the Franchise Agreement, any amendments to it, or any other agreement executed by the franchisee that is referenced within the Franchise Agreement.
In practical terms, this means that if a Del Taco franchisee fails to meet their contractual obligations, leading to financial losses or legal issues for Del Taco, the franchisee (or the undersigned guarantor) is responsible for covering all associated costs. This could include legal fees if Del Taco has to take action to enforce the agreement, the costs of investigating any financial discrepancies, and any damages or liabilities that Del Taco incurs as a result of the franchisee's actions or inactions. The indemnification extends to any agreement the franchisee has with Del Taco, ensuring comprehensive coverage for Del Taco.
This requirement protects Del Taco from financial risks associated with franchisee non-compliance. For a prospective franchisee, it highlights the importance of fully understanding and adhering to all contractual obligations. Additionally, anyone signing as a guarantor should be aware that they are assuming significant financial responsibility for the franchisee's performance. It is also important to note that the franchisee is responsible for covering Del Taco's legal fees, travel expenses, and other charges in proceedings involving the franchisee in which Del Taco is not a party.