During the term of the Noodles & Company Franchise Agreement, can I divert business from a Noodles & Company Restaurant to a competitor?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
During the Term, you 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.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to the 2025 Noodles & Company Franchise Disclosure Document, during the term of the agreement, a franchisee is prohibited from diverting or attempting to divert business from any Noodles & Company Restaurant to a competitor. This restriction applies whether the inducement is direct or indirect and requires Noodles & Company's prior written consent.
This means that as a Noodles & Company franchisee, you cannot actively try to take customers away from the Noodles & Company system and direct them towards a competing business. This includes actions that could harm the goodwill associated with Noodles & Company's trademarks or the overall system.
The FDD specifies that franchisees are also restricted from owning, maintaining, or being involved with a Competitive Business within the Protected Area, a 15-mile radius of their Noodles & Company Restaurant, a 15-mile radius of any Noodles & Company Restaurant, or anywhere in the United States. These in-term and post-term covenants are typical in franchising to protect the brand and prevent franchisees from using the franchisor's knowledge to compete against the system.