Does Noodles & Company require franchisees to disclose any interest in a Competitive Business in writing?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 23: RECEIPT]
During the term of the Franchise Agreement, you and your Owners shall not, without Noodles & Company's prior written consent, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person, persons, partnership, limited liability company, or corporation:
(a) Divert or attempt to divert any business or customer of any Noodles & Company Restaurant to any competitor, by direct or indirect inducement or otherwise, or do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Noodles & Company's Marks or the System.
(b) [Intentionally omitted]
(c) Own, maintain, advise, be employed by, consult for, make loans to, operate, engage in or have an ownership interest (including any right to share in revenues or profits) in any Competitive Business which is, or is intended to be located within:
(1) the Protected Area;
(2) a radius of 15 miles from your Noodles & Company Restaurant;
(3) a radius of 15 miles of any Noodles & Company Restaurant; or
(4) the United States.
For purposes of this Agreement:
"Competitive Business" means any business that operates or franchises one or more restaurants: (1) whose sales of Specified Dishes (as defined below) collectively constitute more than 10% of restaurant operating revenues; (2) that are the same as, or substantially similar to, the Noodles & Company concept as it evolves or changes over time; or (3) that operate in a fast casual or quick casual format. As used in this Agreement, "Specified Dishes" means noodle dishes, pasta dishes, Asian dishes, Italian or Mediterranean dishes and any other dishes that are the same or substantially similar to the dishes on the Noodles & Company menu ("Noodles & Company Dishes") as it may evolve or change over time.
- 7.01 Confidential Information.
Prior to any training at Noodles & Company Central Support Office or at any Noodles & Company Restaurant, all your trainees must first execute the Confidentiality Agreement.
If you or your Owners cease to have an interest in Franchisee, you and your Owners, if any, must deliver to Noodles & Company any such Confidential Information in your or their possession.
For a continuous uninterrupted period commencing upon the expiration or termination of the Franchise Agreement and for two years thereafter, you and your Owners, shall not, without Noodles & Company's prior written consent, either directory or indirectly, for yourself or through, on behalf of, or in conjunction with any person, persons, partnership, limited liability company, or corporation:
- (a) Divert or attempt to divert any business or customer of any Noodles & Company Restaurant to any competitor, by direct or indirect inducement or otherwise, or
do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with Noodles & Company's Marks or the System.
(b) [Intentionally omitted]
(c) Own, maintain, advise, be employed by, consult for, make loans to, operate, engage in or have an ownership interest (including any right to share in revenues or profits) in any Competitive Business which is, or is intended to be located within:
(1) the Protected Area;
(2) a radius of 15 miles from your Noodles & Company Restaurant;
(3) a radius of 15 miles of any Noodles & Company Restaurant; or
(4) any Designated Market Area (as defined by Nielsen Media Research) where any Noodles & Company Restaurant is located.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company FDD, franchisees and their owners must obtain prior written consent from Noodles & Company before engaging in any Competitive Business during the term of their Franchise Agreement or Development Agreement. A Competitive Business is defined as any restaurant that operates or franchises one or more restaurants whose sales of specified dishes collectively constitute more than 10% of restaurant operating revenues, that are the same as, or substantially similar to, the Noodles & Company concept, or that operate in a fast casual or quick casual format. Specified Dishes include noodle dishes, pasta dishes, Asian dishes, Italian or Mediterranean dishes, and any other dishes that are the same or substantially similar to the dishes on the Noodles & Company menu.
This restriction applies if the Competitive Business is located within the franchisee's Protected Area, within a 15-mile radius of the franchisee's Noodles & Company Restaurant, within a 15-mile radius of any Noodles & Company Restaurant, or within the United States. After the agreement expires or terminates, these restrictions continue for two years, applying to the same geographic areas, including any Designated Market Area where a Noodles & Company Restaurant is located.
Noodles & Company requires all trainees to execute a Confidentiality Agreement before training at the Noodles & Company Central Support Office or any Noodles & Company Restaurant. Furthermore, if a franchisee or their owners cease to have an interest in the franchise, they must return all Confidential Information to Noodles & Company. This obligation ensures that franchisees and their owners do not use confidential information gained from Noodles & Company to unfairly compete, protecting the brand's trade secrets and competitive advantage.