What is the definition of 'Entity' as it pertains to the Noodles & Company franchise agreement?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
If you are a corporation, partnership, limited liability company or other entity, all persons who have a legal or beneficial interest in you ("Owners") must also execute this Agreement.
You must be a legal entity such as a business corporation, partnership, limited liability company or other legal entity formed for and used for the purpose of developing and holding franchises to operate Noodles & Company Restaurants. You and each of your Principal Owners represent, warrant and agree that: (a) you are duly organized and validly existing under the laws of the state of your organization and you are duly qualified to transact business in the state in which your Noodles & Company Restaurant is located; (b) you have the authority to execute and deliver this Agreement and to perform your obligations hereunder; (c) true and complete copies of the articles or certificate of incorporation, partnership agreement, bylaws, subscription agreements, buy-sell agreements, voting trust agreements and all other documents relating to your ownership, organization, capitalization, management and control have been delivered to us and all amendments thereto shall be promptly delivered to us; (d) your and your entity's activities are restricted to those necessary solely for the development, ownership and operation of your Noodles & Company Restaurant in accordance with this Agreement and in accordance with any other agreements entered into with us or our Affiliate, as applicable; (e) the articles or certificate of incorporation, partnership agreement or other organizational documents recite that the issuance, transfer or pledge of any direct or indirect legal or beneficial ownership interest is restricted by the terms of this Agreement; (f) all certificates
Neither you, your partners, shareholders, members of an LLC nor the entity formed to operate the restaurants may be, or become, during the term of this Agreement and any other agreements between us, including the Franchise Agreement, a Publicly Held Entity.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, if a franchisee is a corporation, partnership, limited liability company, or other entity, all individuals or entities with a legal or beneficial interest in the franchisee are considered "Owners" and must also sign the Franchise Agreement. This requirement ensures that all parties with a stake in the franchise are bound by the agreement's terms and conditions.
Noodles & Company requires franchisees to be a legal entity such as a business corporation, partnership, limited liability company or other legal entity formed for the purpose of developing and holding franchises to operate Noodles & Company Restaurants. The organizational documents must confirm that the entity is duly organized and validly existing under the laws of its state and qualified to conduct business in the relevant state. Furthermore, these documents must restrict the entity's activities solely to the development, ownership, and operation of Noodles & Company restaurants, and any transfer of ownership interests must be restricted by the terms of the Franchise Agreement.
The agreement also stipulates that neither the franchisee, nor its partners, shareholders, or members, may be or become a Publicly Held Entity during the term of the agreement. This provision ensures that the ownership and control of the franchise remain within a defined group, preventing the diffusion of ownership that could occur with a publicly traded entity. This requirement is designed to maintain the integrity and standards of the Noodles & Company brand and operational model.
Prospective franchisees should note that Noodles & Company retains significant control over the organizational structure and ownership of its franchises. Franchisees must provide complete copies of all organizational documents and obtain Noodles & Company's approval for any changes to the entity's form. These requirements are typical in franchising, as franchisors seek to maintain consistency and protect their brand standards across all franchise locations.