What representation does the Noodles & Company buyer make regarding their organizational status?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
- 1.a Buyer and Guarantor, jointly and severally, represent and warrant to Seller (each of which shall be deemed material and independently relied upon by Seller) as follows:
- (i) Buyer and each entity comprising Buyer, if applicable, is duly organized, validly existing and in good standing under the laws of the state of its organization with full power and authority to own its properties and assets and to conduct its business as now conducted or proposed to be conducted.
- (ii) Buyer has the full power and authority to enter into and perform this Agreement and to consummate the transactions contemplated by this Agreement in accordance with the terms of this Agreement.
- (iii) Buyer has taken all necessary corporate actions to authorize and approve the execution, delivery and performance of this Agreement and the transactions contemplated by this Agreement. This Agreement constitutes a legal, valid and binding obligation of Buyer and Guarantor enforceable against Buyer and Guarantor in accordance with its terms.
Buyer and Guarantor each hereby covenants and agrees that the foregoing representations and warranties are true and correct as of the date given and shall be true and correct as of the Closing unless Buyer notifies Seller in writing otherwise.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company Franchise Disclosure Document, the buyer represents and warrants their organizational status to the seller. Specifically, the buyer, including each entity comprising the buyer, if applicable, must be duly organized, validly existing, and in good standing under the laws of its state of organization. They must possess full power and authority to own their properties and assets and to conduct their business as it is currently conducted or proposed to be conducted.
Furthermore, the buyer must have the full power and authority to enter into and perform the franchise agreement and to complete the transactions outlined in the agreement, adhering to its terms. The buyer confirms that all necessary corporate actions have been taken to authorize and approve the execution, delivery, and performance of the agreement and its contemplated transactions. This ensures that the agreement constitutes a legal, valid, and binding obligation of the buyer, enforceable in accordance with its terms.
These representations and warranties must be true and correct as of the date they are given and must remain true and correct as of the closing date, unless the buyer notifies the seller in writing otherwise. This places a responsibility on the buyer to ensure their organizational status remains compliant throughout the transaction process. This is a standard practice in franchising to ensure the franchisor is dealing with a legitimate and legally sound entity.