For Noodles & Company, how are real and personal property tax and assessment prorations calculated?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
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18.03 Taxes. We will have no liability for any sales, use, service, occupation, exercise, gross receipts, income, property or other taxes, whether levied upon your Noodles & Company Restaurant, your property or upon us, in connection with sales made or business conducted by you (except any taxes we are required by law to collect from you). Payment of all such taxes shall be your responsibility. In the event of a bona fide dispute as to your liability for taxes, you may contest your liability in accordance with applicable law. In no event, however, will you permit a tax sale, seizure, or attachment to occur against your Noodles & Company Restaurant or any of its assets.
You will promptly pay all federal, state and local taxes arising out of the operation of your business. We will not be liable for these or any other taxes and you herby do and will indemnify us for any such taxes that may be assessed or levied against us which arise or result from your business. You shall reimburse us for any sales tax, gross receipts tax, use tax or other tax or assessment imposed by any taxing authority in the state where the Restaurant is located on any fees or other amounts payable to us under this Agreement. Such taxes are distinguishable from income taxes imposed on us by the jurisdiction in which the Restaurant is located. Such income taxes are our responsibility.
19. DISPUTE RESOLUTION.
19.01 Mediation, Jurisdiction and Venue.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document for Noodles & Company does not specify how real and personal property tax and assessment prorations are calculated. However, it does state that franchisees are responsible for paying all taxes related to their Noodles & Company restaurant.
Specifically, franchisees must pay all federal, state, and local taxes arising from the operation of their business. Noodles & Company bears no liability for these taxes, and the franchisee must indemnify Noodles & Company for any such taxes assessed or levied against them that arise from the franchisee's business. This includes reimbursing Noodles & Company for any sales tax, gross receipts tax, use tax, or other tax or assessment imposed by any taxing authority where the restaurant is located on any fees or other amounts payable to Noodles & Company under the Franchise Agreement.
The FDD clarifies that the franchisee's tax responsibilities do not extend to Noodles & Company's income taxes. In the event of a legitimate dispute regarding tax liability, the franchisee may contest it in accordance with applicable law, but they cannot allow a tax sale, seizure, or attachment to occur against their Noodles & Company restaurant or its assets.
Since the FDD does not provide details on the calculation of property tax prorations, prospective franchisees should seek clarification from Noodles & Company regarding the specific procedures and responsibilities related to these taxes. Understanding how these prorations are handled is crucial for accurate financial planning and ensuring compliance with local tax regulations.