What is the C12 Group's policy on terminating a Franchise Agreement for nonperformance?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Training to ensure alignment and success factors for new Area Chairs.
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. Each franchisee's Baseline Target is established on a case-by-case basis. C12 also reserves the unilateral right to terminate a Franchise Agreement for nonperformance after a 90-day right to cure on the part of the franchisee. C12 reserves the right to require additional Baseline Target requirements after 36 months, including achieving greater than 100% of your original Baseline Target (see the example at the end of this Item 12), in order to ensure continued market growth and development. Your original Baseline Target only represents 10% of the estimated number of evangelical CEOs and senior business managers employed by companies in your Territory. During the initial launch period, the franchisee will be responsible for demonstrating good faith development pursuits demonstrated by execution of the business plan crafted during New Chair Training or making at least eight new contacts per week until two CEO Forums are operating with more than six members each. C12 reserves the right to impose a cure process in subsequent months in the case of failure to demonstrate good faith development of a Territory.
You may not solicit current or prospective C12 members who live and work outside your own Territory via direct (e.g., face-to-face, telephone, direct mail, telemarketing, email) or indirect means (e.g., via third parties, other channels of distribution such as the Internet or mutual friends). Any solicited or unsolicited inquiries from outside your Territory will necessitate that the candidate be given the opportunity to attend any Business Forum meeting in their home Territory (i.e., their 'local' CEO Forum) as well as your Business Forum before selecting the specific Business Forum they would like to join. If contacted by such a prospect, you must inform them that there is another C12 Business Forum option and provide contact information for the applicable franchisee. The qualified prospective member is free to elect, based on their own needs, priorities, and evaluation, which Business Forum they would like to join.
Source: Item 12 — TERRITORY (FDD pages 29–32)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, C12 Group can terminate a Franchise Agreement for nonperformance under specific conditions. If a franchisee fails to meet the minimum required levels of target market penetration, which is defined as 33% of the Baseline Target within 24 months and 50% within 36 months of becoming a franchisee, and also fails to have at least one CEO Forum with at least ten CEO Members within two years of opening the business (should 33% of Baseline Target be less than ten CEOs), C12 Group has the right to redefine the exclusive and non-exclusive Territory definitions. However, C12 Group will try to discuss and plan these changes jointly with the franchisee in advance.
Furthermore, C12 Group reserves the unilateral right to terminate a Franchise Agreement for nonperformance, but only after providing the franchisee a 90-day right to cure the nonperformance. C12 Group also reserves the right to require additional Baseline Target requirements after 36 months, potentially exceeding 100% of the original Baseline Target, to ensure continued market growth and development.
Additionally, C12 Group may terminate the Franchise Agreement or revise the franchisee's territorial size and exclusivity if, within the first 90 days after executing the Franchise Agreement, the franchisee has not started building a CEO Forum. This is demonstrated by the franchisee's diligence in performing duties such as making an average of eight contacts per week, attending mandatory Semi-Annual Chair Training sessions and the Sales Training Series, launching a direct marketing campaign, having a specific plan for the first C12 introductory event and/or initial CEO Forum in the Territory, and reporting progress on the Business Plan Goals and Action Plan Goals established during Training Week.