What is the deadline for transferring the interest of a deceased or disabled Operating Partner or controlling Owner of a Noodles & Company franchise?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
| m. Conditions for our approval of transfer | Section 7.02 | You and your Owners and affiliates must be in compliance with Area Development Agreement; the proposed transferee must be an entity that is not publicly held and meets our qualifications and standards for approval; the proposed transferee must agree to be bound to our then current Area Development Agreement for the remainder of the Development Term; all rights to your not yet developed and/or operating Noodles & Company restaurants must be transferred; transfer fee must be paid; you must sign a general release and non-compete agreement; we must approve price and payment terms; we must waive our right of first refusal; any financing you provide to the proposed transferee must be subordinate to the transferee's obligations to pay amounts due to us; there must have been no change in the law since we entered into the Area Development Agreement that would limit our right as to the proposed transferee; the proposed transferee must obtain assignment of leases from all landlords; after the transfer, the proposed transferee must own the minimum number of restaurants that we require of Area Operators; and you must meet any other reasonable requirements we may impose to protect our rights. |
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| n. Our right of first refusal to acquire your business | Section 7.06 | We have the right to purchase your Development Rights for the same price and on the same terms and conditions as any bona fide offer for your business. |
| o. Our right to purchase your | Not applicable | |
| business | ||
| p. Your death or disability | Section 7.05 | Upon death or disability of your Operating Partner or any Owner of a controlling interest in you, all rights of that person in your Area Development Agreement or you must be assigned to an approved buyer within a reasonable time period not to exceed 6 months after the death or disability. |
| q. Non-competition covenants during the term of the franchise | Section 6.02 | Except for a 5.0% or less ownership interest in a publicly traded company, you may not directly or indirectly own or have any legal or beneficial interest in, or render services or give advice to any competitive business located in the United States. A competitive business is any business that operates or franchises one or more restaurants: (1) whose sales of Specified Dishes (as defined below) collectively constitute more than 10.0% of restaurant operating revenues; (2) that are the same as, or substantially similar to, the Noodles & Company concept as it evolves or changes over time; or (3) that operates in a fast casual or quick casual format. As used in this Agreement, "Specified Dishes" means noodle dishes, pasta dishes, Asian dishes, Italian or Mediterranean dishes and any other dishes that are the same or substantially similar to the dishes on the Noodles & Company menu ("Noodles & Company Dishes") as it may evolve or change over time. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 63–83)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, in the event of the death or disability of an Operating Partner or any Owner holding a controlling interest in the franchise, the rights of that person must be assigned to an approved buyer. This assignment must occur within a reasonable timeframe, specifically not exceeding 6 months following the death or disability.
This requirement ensures that the Noodles & Company franchise continues to operate under approved management even in unforeseen circumstances. The 6-month deadline provides a structured period for the transfer of ownership, allowing the estate or legal representatives of the deceased or disabled owner to find a suitable and approved buyer.
Noodles & Company retains the right to approve the buyer, ensuring that the new owner meets the company's qualifications and standards. This protects the brand and the interests of other franchisees within the Noodles & Company system. The franchisor also has the right of first refusal to purchase the business in connection with a proposed transfer following death or disability.