Under the Area Development Agreement for Noodles & Company, will I receive an exclusive territory?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
You will not receive an exclusive territory under the Area Development Agreement. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. The Area Development Agreement grants you the right to develop an agreed upon number of Noodles & Company restaurants within a geographical area described in Exhibit A to the Area Development Agreement (the "Development Area"). Except as described below, during the term of the Development Agreement, we will not operate (directly or through an affiliate), nor license anyone else to operate, any Noodles & Company restaurants located within the Development Area. The size of the Development Area will depend on the number of Noodles & Company restaurants suitable for the Development Area and the trade areas within the Development Area, as we and you determine in light of a number of factors, including, for example, population density, site economics and the residential or commercial character of the area. The Development Area will generally be a metropolitan area or part of a metropolitan or substantial suburban area. The number of Noodles & Company restaurants and the dates they are to be open, and operating will also be set out in Exhibit A to the Area Development Agreement (the "Development Schedule"). The Area Development Agreement does not provide you with any certain options, rights of first refusal or similar rights to acquire or develop additional Noodles & Company restaurants in the Development Area or in any other area. We describe the site selection process in Item 11.
Source: Item 12 — TERRITORY (FDD pages 48–53)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, if you sign an Area Development Agreement, you will not receive an exclusive territory. The agreement grants you the right to develop a specified number of Noodles & Company restaurants within a defined geographical area, known as the Development Area, as detailed in Exhibit A of the Area Development Agreement. During the term of the Development Agreement, Noodles & Company will not operate or license others to operate restaurants within your Development Area. However, this restriction has some exceptions.
The size of your Development Area depends on factors such as the number of suitable Noodles & Company restaurant locations, trade areas, population density, site economics, and the area's residential or commercial nature. The Development Area is typically a metropolitan area or a significant suburban region. The number of restaurants you are expected to open and their opening dates will be outlined in the Development Schedule, also found in Exhibit A.
It is important to note that the Area Development Agreement does not provide any options or rights of first refusal to develop additional Noodles & Company restaurants within or outside your Development Area. You may face competition from other franchisees, company-owned outlets, other distribution channels, or competitive brands controlled by Noodles & Company. Noodles & Company also retains the right to operate or license others to operate Noodles & Company restaurants outside your Development Area and within your Development Area after the Area Development Agreement terminates. They can also sell similar products under similar brand names through various channels like grocery stores and the internet.