factual

What does the Del Taco franchise agreement state regarding Del Taco's right to change or improve the System?

Del_Taco Franchise · 2025 FDD

Answer from 2025 FDD Document

rantee, Indemnification and Acknowledgement in the form attached to this Agreement as Exhibit E, provided, however, that no guarantee shall be required from a person who acquires Franchisee's securities (other than a controlling interest) if and after Franchisee becomes registered under the Securities Exchange Act of 1934.

  • 5.29 System Modifications. Franchisee acknowledges and agrees that from time to time hereafter Del Taco may change or modify the System as Del Taco deems appropriate, including to reflect the changing market and/or to meet new and changing consumer demands, and that variations and additions to the System may be required from time to time to preserve and enhance the public image of the System and operations of Del Taco Restaurants. Del Taco's changes to the System may include the adoption and use of new or modified products, services, equipment and furnishings and new techniques and methodologies relating to the preparation, sale, promotion and marketing of food and beverage products and services, and new trademarks, service marks and copyrighted materials. Notwithstanding the provisions and limitations of Section 5.9, Franchisee shall, upon reasonable notice, accept, implement, use and display in the operation of the Restaurant any such changes in the System, as if they were part of this Agreement at the time of execution hereof, at Franchisee's sole expense. Additionally, Del Taco reserves the right, in its sole discretion, to vary the standards throughout the System, as well as the services and assistance that Del Taco may provide to some franchisees based upon the peculiarities of a particular site or circumstance, existing business practices, or other factors that Del Taco deems to be important to the operation of any Del Taco Restaurant or the System. Franchisee shall have no recourse against Del Taco on account of any variation to any franchisee and shall not be entitled to require Del Taco to provide Franchisee with a like or similar variation hereunder.
  • 5.30 No Third-Party Management. The Restaurant shall be operated under the control and supervision of Franchisee, its Operating Principal, the Restaurant Manager or another manager hired by and employed by Franchisee and approved by Del Taco. Franchisee shall not hire or retain a management company, manager (other than an employee manager trained and approved by Del Taco), or third party to

undertake any of the management or operational functions of the Restaurant. Franchisee shall not be managed or otherwise controlled by any individual not identified as its Operating Principal or owner.

6. Advertising and Marketing.

Recognizing the value of advertising and marketing, and the importance of the standardization of advertising and marketing programs to the furtherance of the goodwill and public image of the System, the parties agree as follows:

  • 6.1 Marketing Fee Expenditure. Del Taco shall use the Marketing Fee for any and all costs of maintaining, administering, directing, conducting, creating and/or otherwise preparing advertising, marketing, public relations and/or promotional programs and materials, and any other activities which Del Taco believes will enhance the image of the System, including the costs of preparing and/or conducting: media advertising campaigns; social media campaigns; direct mail advertising; marketing surveys and other public relations activities; employing advertising and/or public relations agencies to assist therein; brand research and development;

Source: Item 22 — CONTRACTS (FDD pages 58–59)

What This Means (2025 FDD)

According to Del Taco's 2025 Franchise Disclosure Document, Del Taco retains the right to modify the System as it deems appropriate to reflect market changes and consumer demands. These modifications may include new or modified products, services, equipment, furnishings, techniques, methodologies, trademarks, service marks, and copyrighted materials. Franchisees are required to implement these changes at their own expense upon reasonable notice, as if the changes were part of the original agreement.

Del Taco also reserves the right to vary standards throughout the System and the services it provides to franchisees, based on site-specific circumstances, existing business practices, or other factors it deems important. Franchisees are not entitled to recourse or similar variations based on variations offered to other franchisees.

Furthermore, Del Taco may operate and change the System in any manner not expressly prohibited by the franchise agreement. Del Taco's decisions are based on its judgment of what is in the best interest of Del Taco, the System, and the brand overall, without regard to whether other decisions could have been made, whether the decision promotes Del Taco's interests, or whether the decision applies differently to different franchisees. Franchisees must also implement and periodically upgrade the Technology System and Required Software as Del Taco requests in writing, at the franchisee's own expense.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.