What are the conditions under which C12 Group may terminate a Franchise Agreement?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
lved in the monthly one-on-one consultation sessions with the client.
We may terminate the Franchise Agreement or revise your territorial size and exclusivity in our sole discretion if, by the conclusion of the first ninety (90) days after executing the Franchise Agreement, you have not started building a CEO Forum as is demonstrated by your diligence in performing the following duties: (i) making eight (8) Contacts per week on average; (ii) attending the mandatory Semi-Annual Chair Training sessions that occur during that period as well as the Sales Training Series; (iii) launching a direct marketing campaign; (iv) having a specific plan for the first C12 introductory event and/or initial CEO Forum in the Territory, and (v) reporting to us and making progress regarding the specific Business Plan Goals and Action Plan Goals that you established with us during Training Week. (See Franchise Agreement, Section VIII.6) Except as set forth above, the definition of your Territory may not be changed without our and your written consent. You are permitted, at your expense and discretion, to relocate your business, as long as the relocation occurs within the geographic territory boundaries as clearly defined in
your Franchise Agreement. You, under the Franchise Agreement, are NOT permitted, under any circumstances, to relocate the business outside of your Territory. You do not automatically receive the right to additional Territory Units in your area. Additionally, there are no options, rights of first refusal or similar rights under theFranchise Agreement.
You also will have the non-exclusive right to serve those who live or work outside of your Territory but desire to participate in Business Forum meetings hosted in your Territory provided that you follow the same exceptions and restrictions above.
The Franchise Agreement is automatically renewed on a year-to-year basis until (1) either you give C12 a notice to discontinue at least 90 days prior to the end of the then-current term, or C12 gives you a notice to discontinue at least 90 days prior to the end of the then-current term, (2) either party should breach its terms or conditions, or (3) franchisee fails to consent to any updates or changes in the C12 business model and Operations Manual which may have occurred during the prior year by signing a Franchise Compliance Administrative Update letter each year. Compliance with the Field Operations Manual will be understood to include the Brand Standards, mandatory elements of the Meeting Playbook and One-on- One Playbook, and any standard components of the C12 member experience put forth by the C12 Group, LLC.
Except as specifically stated herein, we cannot engage in activities in your Territory that are competitive with your franchise. Nor can we operate, plan to operate, or franchise any businesses under a different trademark that will sell similar goods or services to those of this franchise in your Territory.
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, C12 Group has the right to terminate a Franchise Agreement under certain conditions related to initial performance, ongoing performance, and adherence to the franchise agreement terms. Specifically, C12 Group may terminate the Franchise Agreement if the franchisee does not start building a CEO Forum within the first 90 days after executing the agreement, as demonstrated by specific duties. These duties include making an average of eight contacts per week, attending mandatory training sessions, launching a direct marketing campaign, having a plan for the first C12 introductory event or initial CEO Forum, and reporting progress on business plan goals.
Additionally, C12 Group can terminate the Franchise Agreement for nonperformance after providing a 90-day right to cure. This nonperformance is tied to failing to meet minimum required levels of target market penetration, which are 33% of the Baseline Target within 24 months and 50% within 36 months of becoming a franchisee. The franchisee must have at least one CEO Forum with at least ten CEO Members within two years of opening the business, should 33% of the Baseline Target be less than ten CEOs. C12 Group also reserves the right to redefine exclusive and non-exclusive Territory definitions if these targets are not met, although they will endeavor to discuss and plan such changes in advance.
Furthermore, C12 Group can discontinue the Franchise Agreement if either party breaches its terms or conditions, or if the franchisee fails to consent to any updates or changes in the C12 business model and Operations Manual by not signing a Franchise Compliance Administrative Update letter each year. Compliance with the Field Operations Manual includes adhering to Brand Standards, mandatory elements of the Meeting Playbook and One-on- One Playbook, and any standard components of the C12 member experience put forth by C12 Group, LLC. These termination conditions are fairly typical in franchising, as franchisors need to ensure franchisees are actively developing their territories and adhering to brand standards to maintain the overall health and reputation of the franchise system.