What recourse does a party have if the Noodles & Company agreement is wrongfully terminated?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
egistrar and all listing agencies, upon the termination or expiration hereof, of the termination of Area Operator's right to use any domain name, web page and other Internet devise associated with Noodles & Company or the Restaurant, and authorize and instruct their cancellation or transfer to Noodles & Company, as directed by us. Area
Operator is not entitled to any compensation from us if we exercise our said rights or options. For the avoidance of doubt, nothing in this Section 16 shall be deemed to permit Area Operator to use the Marks, or any of them in whole or in part, in connection with the Internet, except with our prior written consent as provided in this Agreement.
- 16.02 Survival of Obligations. Termination or expiration shall be without prejudice to any other rights or remedies that Noodles & Company or Area Operator, as the case may be, shall have in law or in equity, including, without limitation, the right to recover benefit of the bargain damages. In no event shall a termination or expiration of this Agreement affect Area Operator's obligations to take or abstain from taking any action in accordance with this Agreement. The provisions of this Agreement which constitute posttermination covenants and agreements including the parties' obligation to arbitrate any and all disputes shall survive the termination or expiration of this Agreement. Area Operator shall provide us written confirmation that it has complied with all aspects of Section 16 and will continue to comply with such provisions within 30 days of the effective date of the termination.
- 16.03 No Ownership of Marks. Area Operator acknowledges and agrees that rights in and to Noodles & Company's Marks and the use thereof shall be and remain our property.
- 16.04 Government Filings. In the event Area Operator has registered any of Noodles & Company's Marks or the name Noodles & Company as part of Area Operator's assumed, fictitious or corporate name, Area Operator shall promptly amend such registration to delete Noodles & Company's Marks and any confusingly similar marks or names therefrom.
- 16.05 Post-Term Covenants. Without limiting the generality of Section 16.02, the Post-Term covenants provided in Section 7.03 of this Agreement shall apply up on the expiration or termination of this Agreement.
17. SUCCESSOR FRANCHISE RIGHTS.
- 17.01 Your Right To Renewal. You will have an option to renew your Franchise Agreement for the Noodles & Company Restaurant you operate at the Premises after the Initial Term for two Renewal Terms of 10 years each, subject to the following conditions:
- (i). Not less than 12 months nor more than 18 months before the end of the Initial Term or a subsequent Renewal Term you must have given us written notice of your election to exercise the option. If you do not provide timely written notice of your election to exercise the option, you will be deemed to have waived the option.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company Franchise Disclosure Document, both Noodles & Company and the Area Operator have rights and remedies available in law or equity if the agreement is terminated. This includes the right to recover damages that compensate for the benefit of the bargain. The termination or expiration of the agreement does not affect either party's obligations to take or abstain from taking actions as outlined in the agreement.
Specifically, the Area Operator may be liable for actual and consequential damages if Noodles & Company terminates the agreement due to the Area Operator's default. The Area Operator acknowledges that their default, not Noodles & Company's decision to terminate, is the cause of these damages.
Furthermore, Noodles & Company can seek injunctive relief if the Area Operator violates certain sections of the agreement, such as those relating to trade secrets, confidential information, or post-termination obligations. The Area Operator waives the right to claim damages for the issuance of such an injunction and agrees that any claims they may have against Noodles & Company will not be a defense against the enforcement of these sections. If any legal action is initiated, the prevailing party is entitled to recover reasonable expenses, including attorney fees, from the adverse party.