Does Noodles & Company reserve rights beyond those granted to the Area Operator?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
- (e) Additional Reservation of Rights.
Except for the rights specifically granted to you, we reserve all other rights, including, for example, the following rights:
(i) We reserve the right to manufacture and sell anywhere products that are the same or similar to products sold in Noodles & Company restaurants using brand names that are similar to or the same as the Marks through any channel of distribution, including, for example, grocery stores, supermarkets, convenience stores, caterers and gas stations.
(ii) We reserve the right to sell products and services through other channels of distribution including Internet, wholesale, mail order and catalog.
The Internet is a channel of distribution reserved exclusively to us and you may not independently market on the Internet or conduct e-commerce except as we approve, in our sole discretion.
(iii) We reserve the right to operate and franchise and license others to operate other concept restaurants.
(iv) We reserve the right to develop and/or own other franchise systems for the same or similar products and services using different trademarks than those licensed to you.
(v) We reserve the right to produce, license, manufacture, sell, distribute and market Noodles & Company brand named products, and products bearing other marks, including food and beverage products, clothing, souvenirs, and novelty items through any channel of distribution, including, for example, grocery stores, supermarkets, convenience stores, caterers, and gas stations.
(vi) We reserve the right to purchase or be purchased by, or merge or combine with, competing businesses wherever located.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, Noodles & Company retains significant rights beyond those granted to its Area Operators. Specifically, Noodles & Company reserves the right to manufacture and sell products similar to those sold in Noodles & Company restaurants, even using similar brand names, through various distribution channels such as grocery stores, supermarkets, convenience stores, caterers, and gas stations. This reservation extends to sales through the Internet, wholesale, mail order, and catalogs, with the Internet being exclusively reserved for Noodles & Company itself unless they grant specific approval for franchisee e-commerce activities.
Furthermore, Noodles & Company retains the right to operate, franchise, and license others to operate other concept restaurants. They can also develop or own other franchise systems offering similar products and services under different trademarks. Noodles & Company can produce, license, manufacture, sell, distribute, and market Noodles & Company branded products, including food, beverages, clothing, souvenirs, and novelty items, through any distribution channel. Additionally, Noodles & Company reserves the right to purchase or merge with competing businesses, regardless of location.
These reserved rights highlight that while franchisees are granted the right to operate Noodles & Company restaurants within a defined territory and system, Noodles & Company maintains control over broader market strategies, alternative distribution channels, and potential diversification. This is a fairly standard practice in franchising, allowing the franchisor to adapt to changing market conditions and explore new revenue streams without being restricted by individual franchise agreements. However, prospective franchisees should carefully consider these reservations and how they might impact their own business operations and market potential.
It is important for potential franchisees to understand that the rights granted to them are specifically defined, and all other rights remain with Noodles & Company. This includes the ability to compete with franchisees through alternative channels and potentially through other restaurant concepts. While this allows Noodles & Company to maintain flexibility and control, it also introduces a level of competition that franchisees should be aware of when evaluating the franchise opportunity.