What information must the transferee and its owners provide to Noodles & Company for approval?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
If we have not exercised our right of first refusal under Section 14.06, we will not unreasonably withhold our approval of a Transfer of the Franchise that meets all of the reasonable restrictions, requirements and conditions we
impose on the Transfer, the transferors, and/or the transferee(s), prior to the transfer being valid, including the following:
- (a) you have completed development of your Noodles & Company Restaurant and are operating your Noodles & Company Restaurant in accordance with this Agreement;
- (b) you and your Owners and Affiliates must be in compliance with the provisions of this Agreement and all other agreements with us or our Affiliate, as applicable;
- (c) the proposed transferee must be an entity, and its owners must provide us on a timely basis all information we request; the proposed transferee's owners must be individuals acting in their individual capacities who are of good character and reputation, who must have sufficient business experience, aptitude and financial resources to operate your Noodles & Company Restaurant, and who must otherwise meet our approval;
- (d) the proposed transferee may not be an entity, or be affiliated with an entity, that is required to comply with reporting and information requirements of the Securities Exchange Act of 1934, as amended or other Publicly Held Entity;
- (e) the transferee (or its Operating Partner) and its managers, shift supervisors and other personnel must have completed our initial training program or must be currently certified by us to operate and/or manage a Noodles & Company Restaurant to our satisfaction;
- (f) the transferee (and its owners) must agree to be bound by all of the provisions of this Agreement for the remainder of its Term or, at our option, execute our then-current Franchise Agreement, IT Support Services Agreement and related documents used in the state in which your Noodles & Company Restaurant is located (which may provide for different royalties, advertising contributions and expenditures, duration and other rights and obligations than those provided in this Agreement);
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, a proposed transferee and their owners must provide Noodles & Company with all information the company requests on a timely basis. The owners must be individuals acting in their individual capacities who are of good character and reputation. They also need to demonstrate sufficient business experience, aptitude, and financial resources to operate the Noodles & Company Restaurant, and must otherwise meet Noodles & Company's approval.
Furthermore, the proposed transferee cannot be an entity, or affiliated with an entity, that is required to comply with the reporting and information requirements of the Securities Exchange Act of 1934, as amended, or other Publicly Held Entity. The transferee and its owners must agree to be bound by all the provisions of the current Franchise Agreement for the remainder of its term. Alternatively, at Noodles & Company's option, they may need to execute the then-current Franchise Agreement, IT Support Services Agreement, and related documents used in the state where the restaurant is located, which may include different royalties, advertising contributions, duration, and other rights and obligations.
In addition to providing requested information and meeting the specified criteria, the transferee must obtain an assignment of leases from the landlords for all Restaurants being transferred and obtain liquor and other required licenses from all applicable authorities for all Restaurants being transferred. The proposed transferee must also meet all of the then-current Franchise Agreement requirements, approval processes, and criteria for new Area Operators of Noodles & Company Restaurants, including ownership of the required minimum number of Noodles & Company Restaurants after the Transfer.
Noodles & Company retains significant discretion in approving or denying a transfer. Even if the transferee meets all stated conditions, Noodles & Company can still withhold approval if any federal or state statute, regulation, rule, or law enacted or amended after the agreement date could materially and adversely affect Noodles & Company's rights, remedies, or discretion in its relationship with the proposed transferee. This broad clause underscores the importance of maintaining a positive and compliant relationship with Noodles & Company to facilitate any future transfer.