Does the tenant have the right to assign the lease to Del Taco or its designee during the lease term?

According to Del Taco's 2025 Franchise Disclosure Document, the lease or sublease agreement must include a provision that the Developer (tenant) has the unrestricted right to assign the lease to Del Taco or another Del Taco franchisee. This means that as a Del Taco franchisee, you have the contractual freedom to transfer your lease obligations and rights to Del Taco itself or to another approved franchisee within the Del Taco system without needing additional consent from the landlord.

This clause offers flexibility for the franchisee. For example, if a franchisee faces financial difficulties or wishes to sell their franchise, this provision simplifies the transfer of the lease to a more suitable party, subject to Del Taco's approval of the assignee if it is another franchisee. It also allows Del Taco to step in and assume the lease if the franchisee defaults, ensuring continuity of the Del Taco brand at that location.

However, Del Taco also retains some discretion in these matters. Del Taco may require the Developer and its landlord to execute a lease addendum to incorporate these provisions. Del Taco can also waive any of these requirements, and the Developer has no recourse if Del Taco chooses to do so. This highlights the importance of understanding the specific terms negotiated in your lease agreement and any addenda related to it.

It is important for a prospective Del Taco franchisee to carefully review the lease agreement and any related addenda to fully understand their rights and obligations regarding lease assignments. Franchisees should also seek legal counsel to ensure they understand the implications of these provisions and how they might affect their business operations and exit strategies.