What is the purpose of the Noodles & Company deferred compensation plan?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
sted in their own contributions. In 2019, the board of directors authorized matching contributions equal to 25% of the first 4% of compensation that is deferred by the participant. The Company recognized matching contribution expense of $0.4 million in each of the fiscal years 2024, 2023 and 2022, respectively.
Deferred Compensation Plan
The Company's deferred compensation plan, under which compensation deferrals began in 2013, is a non-qualified deferred compensation plan which allows highly compensated employees to defer a portion of their base salary and variable compensation, including 401(k) refund, each plan year. To offset its obligation, the Company holds a portfolio of mutual funds in a Rabbi Trust. As of December 31, 2024 and January 2, 2024, $1.2 million and $1.2 million, respective
Source: Item 22 — CONTRACTS (FDD pages 98–99)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, the deferred compensation plan allows highly compensated employees to defer a portion of their base salary and variable compensation, including 401(k) refunds, each plan year. This plan is a non-qualified deferred compensation plan, and compensation deferrals began in 2013.
To offset its obligation, Noodles & Company holds a portfolio of mutual funds in a Rabbi Trust. As of December 31, 2024 and January 2, 2024, the value of the mutual funds held by Noodles & Company was $1.2 million, which was included in other assets, net. Correspondingly, $1.2 million was included in accrued expenses and other current liabilities and other long-term liabilities, representing the carrying value of the liability for deferred compensation.
For a prospective franchisee, this information is relevant in understanding the financial obligations and strategies Noodles & Company employs for its highly compensated employees. While it doesn't directly impact the franchisee's operations, it provides insight into the company's overall financial management and employee compensation practices.