Does a C12 Group franchisee have options or rights of first refusal for additional territory?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
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.
Once you have achieved two full Business Forums, you may also request an expansion of your Territory based on a proposed business plan. C12 must review and approve any such plan before it is pursued. Territory expansion will require a payment for each additional Unit of market potential (calculated as described in Item 5 & Item 7) according to C12's prevailing Franchise Fee (i.e., currently discounted for compliant franchisees seeking to expand at $20,000 per additional Unit).
You will have a specific exclusive Territory, which is defined mutually by C12 and you and should be incorporated in your business plan development in conjunction with C12. This Territory will be defined based on geography, in terms of cities, zip codes, counties, states, or the radius around your home address. There is no minimum granted Territory size. No other franchisee shall have the right to establish, acquire, or operate a franchise within your exclusive Territory. You will have the exclusive right to offer C12 services, programs, and materials in your Territory via the hosting of CEO Forum meetings and Key Players Forum meetings in that geography
C12 grants exclusive territory to the C12 Principal Chairs (franchisees). If you fail to meet minimum required levels of target market penetration (i.e., 33% of Baseline Target within 24 months and 50% within 36 months of becoming a franchisee with at least one (1) CEO Forum with at least ten (10) CEO Members within two years of opening the business should 33% of Baseline Target be less than ten (10) CEOs), C12 has the unilateral right to redefine exclusive and non-exclusive Territory definitions but will endeavor to jointly discuss and plan such changes in advance.
"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.
Your original Baseline Target only represents 10% of the estimated number of evangelical CEOs and senior business managers employed by companies in your Territory.
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, a franchisee does not automatically receive the right to additional territory units in their area, nor do they have options or rights of first refusal under the Franchise Agreement. However, once a franchisee has established two full Business Forums, they can request an expansion of their territory based on a proposed business plan, which C12 Group must review and approve. Territory expansion requires a payment for each additional Unit of market potential, currently discounted for compliant franchisees at $20,000 per additional Unit.
The territory is defined based on geography, such as cities, zip codes, counties, states, or the radius around the franchisee's home address, and there is no minimum granted territory size. The franchisee has the exclusive right to offer C12 Group services, programs, and materials in their territory via hosting CEO Forum meetings and Key Players Forum meetings. The potential value of a territory is determined by its geographic size and the estimated number of evangelical Christians who are owners, CEOs, or senior managers of companies with at least ten employees and $1 million in annual revenue.
C12 Group also grants exclusive territory to its Principal Chairs (franchisees). However, if a franchisee fails to meet minimum required levels of target market penetration (33% of Baseline Target within 24 months and 50% within 36 months), C12 Group has the right to redefine exclusive and non-exclusive territory definitions. The Baseline Target is the specific number of C12 Group members for a given territory, equating to the level of market penetration determined by calculations based on the number of companies in the territory, the applicable Evangelical Rate, and a 10% market penetration rate. The original Baseline Target represents 10% of the estimated number of evangelical CEOs and senior business managers in the territory.