Is a C12 Group franchisee allowed to have any competing commercial interests?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
sources or subscriptions as Franchisor determines to be broadly beneficial for Franchisee, Franchisee's C12 members, and the C12 franchise system.
IV. Franchisee's Duties
-
- General Operation of the Franchised Business. Upon completing New Chair Training and being approved by Franchisor to open for business, Franchisee agrees to perform the following in regard to each area of the C12 business for as long as this Agreement is in effect in order to (i) facilitate consistency among C12 franchisees, (ii) provide reliable quality and member value based on proven C12 methods and materials, (iii) promote consistency in advertising, marketing and brand building efforts, and (iv) to remain an integral part of the community of C12 leaders devoted to working together to continually enhance the Franchisor's standardized offering for Franchisor and Franchisee's mutual benefit and the benefit of all those in the C12 network of peer Christian business leaders globally:
- a. Full-Time Vocation. Franchisee shall operate the Franchised Business on a full-time basis, dedicating Franchisee's full time and attention to the operation thereof. Franchisee must not have any competing commercial interests.
- b. Entity Ownership. If Franchisee is an entity and not an individual, the Franchised Business must be under the daily supervision of someone who is an owner and, if applicable, an officer of the
Franchisee who meets all of Franchisor's ongoing training requirements (a "C12 Area Chair"). If circumstances should ever change, and such person is no longer both an owner and officer of Franchisee and Franchisee does not have a suitable replacement candidate for the role of C12 Area Chair (contingent on Franchisor's approval), then Franchisor may, in its sole discretion, terminate this Agreement or allow the Franchised Business to be transferred or sold to an approved third-party. All owners with a five percent (5%) or greater beneficial interest in Franchisee must, as a condition precedent to the effectiveness of this Agreement, agree to honor the terms of this Agreement in their individual capacities by executing the Owners Guaranty attached hereto as Attachment A. Such individuals' liability under this Agreement shall be joint and several.
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, a franchisee is not allowed to have any competing commercial interests. The FDD states that the franchisee must operate the franchised business on a full-time basis, dedicating their full time and attention to its operation.
This requirement ensures that the franchisee is fully committed to the C12 Group business and does not divert resources or attention to other ventures that could compete with or detract from the success of the C12 Group franchise. This full-time commitment is a standard expectation in many franchise systems, as it helps maintain brand consistency and quality of service.
Furthermore, the franchise agreement specifies that the franchisee agrees not to own an interest or participate in any business viewed as competitive, injurious, or incompatible with C12 Group. The franchisee must engage in the C12 Group franchised business as their primary vocation, without other vocational interests that could materially and adversely impair their ability to fulfill their obligations under the agreement. This clause is designed to protect C12 Group's market position and prevent franchisees from using the C12 Group system to benefit other competing businesses.
These restrictions are in place during the term of the franchise agreement. After termination of the agreement, a non-compete clause is in effect for two years, preventing the franchisee from engaging with a competitive business that offers peer mentorship and coaching to Christian business leaders within the territory or nearby areas. This post-termination restriction underscores the importance C12 Group places on protecting its business model and member relationships.