Does the C12 Group agreement specify how the territory definition impacts the franchisee's obligations?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
oliciting or accepting orders from inside the franchisee's Territory.
Your Franchise Agreement will include a specified geographic Territory (the "Territory") in which you will have the exclusive right to operate a C12 franchise which includes the right to develop and facilitate CEO Forums and Key Player Forums and to use C12 materials and resources in that Territory. "CEO Forum" is defined as a business peer executive roundtable of business owners and/or CEOs who meet together monthly to exchange advice about running their businesses and apply C12's content and resources aligned with biblical truth to their companies. "Key Players Forum" is defined as a business peer executive roundtable of presidents, vice presidents, general managers, directors, and other executive leaders within a company which is principally led by a member of a CEO Forum and which covers and applies the same C12 content and processes as a CEO Forum.
Although a Territory is defined in terms of geography in your Franchise Agreement, the geographic size of a Territory is only one of two factors used in determining the potential value of the Territory to a C12 franchisee. The other factor is the estimated number of evangelical or "Bible-minded and practicing" Christians within the Territory who are owners, chief executive officers, or equivalent senior managers of companies having headquartered in the Territory and that have at least ten employees and/or at least $1 million in annual revenue, excluding public and government offices, public schools, adult entertainment, and other non-applicable SIC codes ("Target Companies"). Therefore, in addition to a Territory having a geographic description in a Franchise Agreement, it also is described in terms of the number of Units included within such geographic region, with the estimated number of evangelical Christian chief executive officers and senior business managers employed by companies ("Evangelical Rate") within the Territory having at least 10 employees and at least $1 million in annual revenue, as calculated by C12 using data from Intelligent Direct, Inc. ("IDI") dba GbBIS, Inc. and The Barna Group, Ltd.
For example, using October 2022 data, the Indianapolis, Indiana Metropolitan Statistical Area (MSA) included 5,590 Target Companies, with 15% of the chief executive officers or equivalent senior business managers of such Target Companies likely to be evangelical Christians. Therefore, the number of Units corresponding to that Territory would be equal to 3.49, calculated asfollows:
5,590 Target Companies x 15% Evangelical Rate x 10% Market Penetration / 24 CEOs per Unit = 3.49
"Baseline Target" is defined as the specific number of C12 members for a given Territory that equates to the level of market penetration that is determined by the calculations set forth below. Each franchisee's Companies in the Territory, the applicable Evangelical Rate for the region, and a 10% market penetration rate. This rate is based on a defined geographical area from business census data provided by IDI. It is based on businesses with 10+ full-time employees and $1 million+ in revenue. The 10% penetration rate represents a reasonable and customary formula for establishing franchise territories.
For example, the Baseline Target for Indianapolis is as follows:
5,590 Target Companies x 15% Evangelical Rate x 10% Market Penetration Rate = 84 C12 CEO Members
ITEM 13: TRADEMARKS
C12 is the owner of certain trademarks, service marks, trade names, logotypes, internet domain names, and other commercial symbols which you will use under license from us through the Franchise Agreement. The C12 Group ® service marks listed below are registered with the United States Patent and Trademark Office ("USPTO"), as Principal Register federal registrations, thereby granting C12 certain presumptive rights.
| TRADEMARK | REGISTRATION NUMBER | DATE OF REGISTRATION | REGISTER | |---|---|---|---| | The C12 Group | 2,720,517 | June 3, 2003 | Principal | | | 4,574,577 | July 29, 2014 | Principal | |---|---|---|---| | | 6,073,903 | June 9, 2020 | Principal | | BUILDING GREAT | 6,254,358 | January 26, 2021 | Principal | | BUSINESSES FOR A | | | | | GREATER PURPOSE | | | | | | 6,966,865 | January 31, 2023 | Principal | | MISSIONPRENEUR | 7,576,028 | November 26, 2024 | Principal | | FORUM | | | | All required affidavits and renewals have been filed.
The C12 Group ® service marks listed below are pending registration with the USPTO, as Principal Register federal registrations, thereby granting C12 certain presumptive rights.
| TRADEMARK | SERIAL NUMBER | DATE OF APPLICATION | REGISTER | |---|---|---|---| | Buffalo Culture | 98,180,822 | September 14, 2023 | Principal | | | 98,180,817 | September 14, 2023 | Principal | We do not have a federal registration for the two pending trademarks in the preceding table. Therefore, our trademarks do not have many legal benefits and rights as a federally registered trademark. If our right to use the trademarks is challenged, you may have to change to alternative trademarks, which may increase your expenses.
We currently have opposition proceedings regarding our two pending trademarks. The opposition is ongoing, and the parties are working toward a settlement agreement that would allow for the registration of both marks.
You agree to use our current and future trademarks, service marks, trade names, document templates, logotypes, and domain names only in the ways we have approved in advance in writing as we have set
forth in our training and operating manuals or in other routine communications to C12, such a semiannual workshops and via our www.C12forums.com web-based portal for franchisee materials, resources, and information. C12 branding and marks will only be used in conjunction with the delivery of C12's goods and services and not with unaffiliated business which may be transacted by a C12 franchisee.
Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD page 36)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, the franchise agreement specifies several ways the territory definition impacts a franchisee's obligations. C12 Group grants the franchisee the right to operate within a defined territory, which is described in a map and list of zip codes. Franchisees must comply with C12 Group's standards and Christian conduct, and can only offer approved services and products within their territory.
The franchisee has the exclusive right to establish a C12 Group business and market its services within the territory. Franchisees cannot host meetings outside their territory but can serve members who live or work outside the territory but attend meetings within it. Franchisees must reside within their territory unless C12 Group approves otherwise. They are also restricted from soliciting current or prospective members who live and work outside of their territory, and if contacted by such individuals, they must inform them of other C12 Group options and provide contact information for the relevant franchisee.
Franchisees are not allowed to relocate their business outside of their territory. Expansion of the territory is possible upon achieving two full Business Forums and with C12 Group's approval of a proposed business plan, requiring payment for each additional unit of market potential. C12 Group also retains the right to negotiate enterprise relationships with national brands, which the franchisee must honor, potentially affecting pricing and benefits offered to members within their territory.