Is a Noodles & Company franchisee obligated to operate their restaurant at the designated Premises for the entire franchise term?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
2.01 Grant of Franchise and Term. Subject to the terms of this Agreement, we grant to you the right, and you assume the obligation, to operate a Noodles & Company Restaurant at the location set forth on the front page of this Agreement (the "Premises") and to use the Marks and System solely in connection therewith, for a term of 20 years, starting on the date of the opening of your Noodles & Company Restaurant (the "Term"). Immediately after the opening date, Noodles & Company may, at its discretion, deliver a Confirmation of Term Commencement Date in the form of Exhibit C hereto. You must conduct the business of your Noodles & Company Restaurant at the Premises for the duration of the Term. You may not conduct the business of your Noodles & Company Restaurant or use the System at any site other than the Premises, or relocate your
Noodles & Company Restaurant, without our consent. For the duration of the Term, you have the obligation to relocate a closed Noodles & Company Restaurant at a mutually acceptable location, unless we determine otherwise at our discretion. In connection with any catering program approved, implemented or maintained by us, you shall have the right to cater to businesses or other locations within the Protected Area if you follow all procedures and menu requirements, purchase all supplies, products and ingredients through Approved Suppliers and Designated Suppliers, and otherwise follow the Operations Manual as to catering. You may engage with third-party food ordering and delivery systems, and ring up and account for ordering, delivery and catering charges not included in the price of products, only in the manner we permit.
2.02 Your Protected Area. During the Term, we will not operate (directly or through an Affiliate), nor grant to another person the right to operate, any Noodles & Company Restaurant located within the geographical area depicted on the attached Exhibit E, Protected Area Exhibit, as the "Protected Area," unless such Restaurant(s) was in operation, under lease or construction or other commitment to open prior to execution of this Agreement, which Restaurant(s) is expressly excluded from this clause.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, a franchisee is obligated to operate their restaurant at the location specified in the franchise agreement for the entire 20-year term. Specifically, the franchisee must conduct the Noodles & Company restaurant business at the designated Premises for the duration of the Term.
Noodles & Company franchisees are prohibited from operating the restaurant or utilizing the Noodles & Company system at any location other than the designated Premises without prior consent from Noodles & Company. Furthermore, relocating the Noodles & Company restaurant requires the franchisor's consent. However, franchisees have the obligation to relocate a closed Noodles & Company restaurant at a mutually agreeable location, unless Noodles & Company determines otherwise at its discretion.
This clause ensures that Noodles & Company maintains control over where its brand is represented and that franchisees adhere to the agreed-upon location. This is typical in franchising, as location is a critical factor for success. The franchisee benefits from the protected area granted by Noodles & Company, where the franchisor will not operate or grant another franchise within the defined geographical area during the term, as detailed in Exhibit E of the franchise agreement.