What happens to amounts owed to Noodles & Company and its Affiliates upon termination?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Noodles & Company may retain all fees paid pursuant to this Agreement, and Area Operator shall immediately pay any and all amounts owing to Noodles & Company and its Affiliates.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company Franchise Disclosure Document, if the Area Operator's rights are terminated or expire, the Area Operator must immediately pay all outstanding amounts owed to Noodles & Company and its affiliates. This means that any unpaid royalty fees, marketing fund contributions, or other debts must be settled immediately.
This provision protects Noodles & Company by ensuring that it receives all outstanding payments upon the termination of the franchise agreement. It also motivates franchisees to stay current on their payments to avoid accumulating a large debt that must be paid immediately if the agreement is terminated.
For a prospective Noodles & Company franchisee, this highlights the importance of maintaining good financial standing with the franchisor. Failure to do so could result in owing a substantial sum if the franchise agreement is terminated. Franchisees should carefully review their payment obligations and ensure they have a plan to meet them to avoid potential financial strain upon termination.