Under what circumstances can Del Taco refuse a transfer of ownership of a Del Taco franchise?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in the Agreement | Summary |
|---|---|---|
| n. Our right of first refusal to acquire your business | 12.6 | We have an option for 30 days to purchase upon same terms and conditions offered to the third party. |
| o. Our option to purchase your business | 12.6 | We have an option to purchase your business upon the termination or expiration of your Franchise Agreement. |
| p. Your death or disability | 12.7 and 12.8 | We will not withhold consent unreasonably to a transfer to a third party within 6 months, provided the transferee meets our general conditions of transfer. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–46)
What This Means (2025 FDD)
According to the 2025 Del Taco Franchise Disclosure Document, Del Taco has a right of first refusal to acquire a franchisee's business. This means that if a franchisee receives an offer from a third party to purchase their Del Taco franchise, Del Taco has the option to purchase the franchise on the same terms and conditions as the third party's offer. Del Taco has 30 days to exercise this option.
Additionally, Del Taco retains the option to purchase a franchisee's business upon the termination or expiration of the Franchise Agreement. This gives Del Taco control over who operates a Del Taco restaurant after the initial franchise term or if the agreement is terminated.
However, in the event of a franchisee's death or disability, Del Taco will not unreasonably withhold consent to a transfer of the franchise to a third party, provided the transferee meets Del Taco's general conditions for transfer. This provision aims to provide some flexibility and consideration for the franchisee's family or estate in such circumstances, while still ensuring that any new franchisee meets Del Taco's standards.