What is the term length of the Del Taco Development Agreement?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
This Agreement and all Development Rights shall expire immediately upon the required opening date for the last Restaurant set forth on the Development Schedule or the actual opening date for the last Restaurant, whichever first occurs, unless sooner terminated in accordance with the terms and conditions of this Agreement.
Time of Essence.
Time is of the essence of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the Development Agreement's term length is tied to the Development Schedule. The agreement and all development rights expire either on the required opening date for the last restaurant in the schedule or the actual opening date of the last restaurant, whichever comes first. The agreement can also terminate sooner if specific terms and conditions within the agreement are not met.
This means that a Del Taco developer's rights are directly linked to their ability to meet the agreed-upon development timeline. If a developer fails to open restaurants according to the schedule, the agreement could expire prematurely. This incentivizes developers to adhere strictly to the development schedule outlined in Exhibit B of the Development Agreement.
Prospective Del Taco developers should carefully review the Development Schedule and assess their capacity to meet the required opening dates. Delays in site acquisition, construction, or obtaining necessary permits could impact the term of the agreement. Since time is of the essence, it is crucial to have a solid plan and resources in place to avoid potential termination of development rights.