Under what conditions can the Buyer assign its rights or obligations under the Noodles & Company agreement?

According to the 2025 Noodles & Company Franchise Disclosure Document, a buyer's ability to assign their rights or obligations is restricted and requires the seller's prior written consent. This consent can be withheld at the seller's sole discretion, meaning Noodles & Company has significant control over who can assume the buyer's responsibilities and rights under the agreement. This condition applies to any assignment, whether direct, indirect, or by operation of law.

This requirement protects Noodles & Company by ensuring that any new party taking over a franchise meets their standards and is capable of maintaining the brand's reputation and operational consistency. It allows Noodles & Company to evaluate the proposed transferee's financial stability, business acumen, and commitment to adhering to the franchise agreement. Without this control, a franchisee could potentially transfer their obligations to an unqualified party, which could harm the Noodles & Company brand.

For a prospective Noodles & Company franchisee, this means that exiting the agreement by transferring it to another party is not guaranteed. They must obtain approval from Noodles & Company, and there is no assurance that such approval will be granted. This lack of certainty could affect the franchisee's ability to sell the franchise if they decide to exit the business, as the pool of potential buyers is limited to those approved by Noodles & Company. Therefore, understanding the criteria Noodles & Company uses to evaluate potential transferees is crucial for any prospective franchisee.

In contrast, the franchise agreement is fully transferable and assignable by Noodles & Company. This asymmetry is common in franchising, where the franchisor retains broad rights to transfer the agreement to ensure business continuity and flexibility in corporate restructuring or acquisitions. Franchisees should be aware of this imbalance and consider its implications for their investment and exit strategy.