What right does the Franchise Agreement grant to the franchisee of a Noodles & Company restaurant?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
After the ADA has been executed, you must sign our then-current form of franchise agreement (the "Franchise Agreement") for each Noodles & Company restaurant that we agree you may open, which may be different than our current form of Franchise Agreement attached hereto as an exhibit. Each Franchise Agreement will grant you the right to own and operate a single Noodles & Company restaurant at an agreed-upon location. A copy of our current form of Franchise Agreement is attached as Exhibit C.
Source: Item 1 — The Franchisor and any Parents, Predecessors, and Affiliates (FDD pages 10–12)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, the Franchise Agreement grants the franchisee the right to own and operate a single Noodles & Company restaurant at an agreed-upon location. However, Noodles & Company sells franchises only as part of a multi-unit area development agreement with a minimum commitment of three restaurants. Prospective franchisees must first submit personal, financial, and business information for review. If Noodles & Company decides to proceed, they will require the franchisee to develop and open an agreed-upon number of restaurants within a specific geographic area and according to a development schedule, as outlined in the Area Development Agreement (ADA).
After the ADA is executed, the franchisee must sign Noodles & Company's current form of Franchise Agreement for each restaurant they are approved to open. It is important to note that the Franchise Agreement signed at this stage may differ from the sample Franchise Agreement included as an exhibit in the FDD. This means that the terms and conditions could change between the initial review and the actual signing of the agreement for each location.
In addition to the standard franchise arrangement, Noodles & Company may also offer franchises for restaurants in non-traditional venues such as airports, military bases, and universities. The terms and conditions for these non-traditional venues can vary significantly from the standard Franchise Agreement and ADA. Furthermore, Noodles & Company may sell and franchise company-owned restaurants, requiring the franchisee to sign a Franchise Agreement and possibly an ADA for development in the area where the purchased restaurant is located, with financial and other terms potentially differing from the standard agreements.
Prospective franchisees should carefully review the Area Development Agreement and the Franchise Agreement, paying close attention to the development schedule, geographic area, and any potential variations in terms for non-traditional venues or purchased company-owned restaurants. It is also crucial to understand the minimum three-restaurant commitment and the financial implications of developing multiple units. Consulting with a franchise attorney is advisable to fully comprehend the obligations and rights outlined in these agreements.