Under what conditions does the Del Taco software license agreement terminate?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
Term. The term of this Agreement shall begin on the Effective Date and shall expire upon the expiration date of the Franchise Agreement (i.e. (a) the expiration of the initial term of the Franchise Agreement, in the event Licensee does not renew its right to operate the Licensed Restaurant pursuant to Section 2.2 of the Franchise Agreement, or (b) the expiration of such renewal term, in the event Licensee renews its right to operate the Licensed Restaurant pursuant to Section 2.2 of the Franchise Agreement), unless terminated sooner pursuant to Article 12 of this Agreement, or pursuant to the terms of the Franchise Agreement.
USE LIMITATIONS
Termination. If Licensee exceeds the authorized scope of the License granted under this Agreement or violates any obligation under Articles 3 or 8 of this Agreement with respect to any License, Del Taco may, in its sole discretion, immediately terminate this Agreement or the License granted with respect to any or all of the Licensed Restaurants without prior notice. Del Taco may, in its sole discretion, immediately terminate this Agreement or the License granted with respect to any Licensed Restaurant(s): (i) without prior notice, if Licensee fails to pay the License Fee or Support Services Fee pertaining to that Licensed Restaurant within 30 days after it is due; (ii) without prior notice, if the franchise or license agreement for that Licensed Restaurant is terminated; (iii) without prior notice, if the franchise, franchise agreement or Licensed Restaurant is transferred; or (iv) if Licensee fails to cure any other breach of this Agreement within 15 days of written notice of the breach.
Discontinuation of Software and Documentation. Del Taco may discontinue publication or distribution of the Software and Documentation for any reason. If Del Taco discontinues publication or distribution of the Software and Documentation, this Agreement shall terminate immediately with respect to all Licenses. In that event, Del Taco will refund or credit a pro rata portion of any License Fees already paid by Licensee, as determined by Del Taco in its sole discretion.
Injunction. If a final injunction is obtained against the use of any part of the Software by reason of infringement of a U.S. copyright or patent, Del Taco shall have the right, at its option, either to: (i) procure for Licensee the right to continue to use the Software; (ii) modify the Software so that it becomes non-infringing; or (iii) terminate this Agreement without penalty.
Source: Item 23 — RECEIPTS (FDD pages 59–325)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the software license agreement can terminate under several conditions. The agreement's term begins on the effective date and expires when the Franchise Agreement expires, either at the end of its initial term if the franchisee doesn't renew, or at the end of the renewal term if they do. However, the agreement can be terminated sooner under specific circumstances outlined in Article 12 of the agreement or within the Franchise Agreement itself.
Del Taco has the discretion to immediately terminate the agreement or the license for specific restaurants if the franchisee exceeds the authorized scope of the license or violates Articles 3 or 8 of the agreement. Additionally, Del Taco can terminate the agreement immediately, without prior notice, if the franchisee fails to pay the License Fee or Support Services Fee within 30 days of the due date, if the franchise agreement for a restaurant is terminated, or if the franchise or restaurant is transferred. Del Taco can also terminate the agreement if the franchisee fails to correct any other breach of the agreement within 15 days of receiving written notice.
Furthermore, Del Taco may discontinue the publication or distribution of the software and documentation for any reason, which would result in the immediate termination of the agreement for all licenses. In such a case, Del Taco will refund or credit a pro rata portion of any License Fees already paid, with the exact amount determined at Del Taco's discretion. If a final injunction is obtained against the use of any part of the Software by reason of infringement of a U.S. copyright or patent, Del Taco has the right to either procure for Licensee the right to continue to use the Software; modify the Software so that it becomes non-infringing; or terminate this Agreement without penalty.