Does Noodles & Company require approval for private placements of securities by franchisees or their affiliates?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
Any proposed private placement of your or of your Affiliate's securities must be approved by us and our legal counsel prior to the offering of securities. You shall pay the costs of such review and associated legal fees.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, any proposed private placement of securities by a franchisee or their affiliates requires approval from Noodles & Company and its legal counsel. This means that if a franchisee or an affiliated entity intends to raise capital through a private placement, they must first seek and obtain permission from Noodles & Company.
Furthermore, the franchisee is responsible for covering the costs associated with the review process and any related legal fees incurred by Noodles & Company. This financial burden adds an extra layer of expense for the franchisee when seeking approval for private placements.
This requirement allows Noodles & Company to maintain control over the financial activities of its franchisees and their affiliates, ensuring that such activities align with the brand's overall interests and legal compliance. It also protects Noodles & Company from potential liabilities or negative impacts that could arise from unauthorized or poorly executed private placements. Franchisees need to factor in both the approval process and the associated costs when considering raising capital through private placements.