Under what condition are Del Taco transfer fees collectable?

The 2025 Del Taco Franchise Disclosure Document states that the fees payable under Section 3 of the Franchise Agreement shall not become due until the opening of the business at the Franchised Site. This means that any transfer fees or other fees outlined in Item 5 of the FDD are only collectable once the Del Taco restaurant is open and operational.

This condition is favorable for prospective Del Taco franchisees because it aligns the payment of fees with the commencement of business operations. Franchisees are not required to pay these fees upfront before the restaurant is generating revenue. This reduces the initial financial burden and risk for the franchisee.

However, it is important to note that this condition may be subject to state-specific regulations. For example, the South Dakota Addendum states that the initial franchise fee and all other initial payments owed by Franchisee to Franchisor shall become due only upon the opening of the Restaurant. Therefore, franchisees should carefully review the FDD and any state-specific addenda to understand the exact conditions for fee collection in their specific location.