What activities are prohibited regarding Competitive Businesses within the Protected Area for a Noodles & Company franchisee?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
During the Term, you shall not, without Noodles & Company's prior written consent, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person, persons, partnership, limited liability company, or corporation:
(a) Divert or attempt to divert any business or customer of any Noodles & Company Restaurant to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Noodles & Company's Marks or the System.
(b) [Intentionally omitted]
(c) Own, maintain, advise, be employed by, consult for, make loans to, operate, engage in or have an ownership interest (including any right to share in revenues or profits) in any Competitive Business which is, or is intended to be located within:
(1) the Protected Area;
(2) a radius of 15 miles from your Noodles & Company Restaurant;
(3) a radius of 15 miles of any Noodles & Company Restaurant; or
(4) the United States.
- 7.03 Post-Term Covenants. For a continuous uninterrupted period commencing upon the expiration or termination of this Agreement and for two years thereafter, you shall not, without Noodles & Company's prior written consent, either directory or indirectly, for yourself, or through, on behalf of, or in conjunction with any person, persons, partnership, limited liability company, or corporation:
- (a) Divert or attempt to divert any business or customer of any Noodles & Company Restaurant to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Noodles & Company's Marks or the System.
(b) [Intentionally omitted]
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company FDD, both during the term of the agreement and for a period of two years after the agreement's expiration or termination, a franchisee and their owners are restricted from certain activities related to competitive businesses. These restrictions apply unless Noodles & Company provides prior written consent.
Specifically, franchisees are prohibited from owning, maintaining, advising, being employed by, consulting for, making loans to, operating, engaging in, or having an ownership interest in any Competitive Business. This includes any right to share in revenues or profits from such a business. The restriction applies to businesses located within the franchisee's Protected Area.
These restrictions also extend to Competitive Businesses located within a 15-mile radius of the franchisee's Noodles & Company restaurant, a 15-mile radius of any Noodles & Company restaurant, or any Designated Market Area (as defined by Nielsen Media Research) where a Noodles & Company restaurant is located. These post-term covenants do not apply after the second anniversary of when the franchisee ceases to have an ownership interest or stops providing services to the franchisee.