Does the Del Taco Development Agreement include any provisions for termination?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
equired by applicable state law) after Del Taco gives written notice of the default to the Developer.
- (b) With regard to any default not involving the non-payment of money or a noncurable default listed below, Del Taco may terminate this Agreement if the Developer fails to cure the default within 30 days (or any longer period required by applicable state law) after Del Taco gives written notice of the default to the Developer.
- (c) With regard to any of the defaults other than those listed in paragraphs (a), (f), (k) or (l) of Section 14, Del Taco may terminate this Agreement immediately upon written notice to the Developer, subject to applicable state law.
- (d) Upon termination of this Agreement for any reason, and without limiting any rights or remedies available to Del Taco under this Agreement or the law, the Developer shall cease immediately any attempts to select or develop sites on which to construct Restaurants.
- (e) The termination of this Agreement shall not affect the rights of the Developer to operate Restaurants in accordance with the terms of any Franchise Agreement with Del Taco until and unless those agreement terminate or expire.
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- Legal Form of Developer. If the Developer or its successor is a legal entity, the following provisions shall apply:
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to the 2025 Del Taco Franchise Disclosure Document, the Development Agreement does include provisions for termination. Del Taco can terminate the agreement immediately upon written notice to the Developer for defaults, excluding those listed in paragraphs (a), (f), (k) or (l) of Section 14, subject to applicable state law.
Upon termination, the Developer must immediately cease any attempts to select or develop sites for Restaurants, but the termination of the Development Agreement does not affect the Developer's rights to operate Restaurants under existing Franchise Agreements until those agreements terminate or expire.
Additionally, if any provision in the Development Agreement is held invalid and, in Del Taco's reasonable opinion, frustrates the purpose of the agreement, Del Taco has the right to terminate the agreement immediately by written notice to the Franchisee. These termination provisions are typical in franchise agreements, allowing the franchisor to protect its brand and system while also outlining the franchisee's obligations upon termination.