Does Noodles & Company's approval of a transfer constitute a representation as to the fairness of the terms between the franchisee and the transferee?

According to Noodles & Company's 2025 Franchise Disclosure Document, the company's approval of a franchise transfer does not represent an endorsement of the fairness of the terms between the franchisee and the transferee. Noodles & Company explicitly states that its approval isn't a guarantee of the agreement's fairness or the potential success of the restaurant under the new owner.

This means that a prospective franchisee cannot assume that Noodles & Company has vetted the financial or contractual arrangements of the transfer. It is the responsibility of both the seller (franchisee) and the buyer (transferee) to conduct their own due diligence and seek independent legal and financial advice regarding the transfer agreement. Noodles & Company's focus is on ensuring the transferee meets their standards and obligations as a franchisee, not on mediating or guaranteeing the terms of the private transaction between the parties.

This is a fairly standard practice in franchising, as franchisors typically want to avoid liability related to disputes between franchisees and transferees. The franchisor's primary concern is maintaining brand standards and ensuring the ongoing success of the franchise system as a whole. Therefore, prospective franchisees should carefully review all transfer agreements and not rely solely on the franchisor's approval as an indication of a fair deal.