What qualifications must a person have to hold a C12 Group franchise?

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. Franchisor may, in its discretion, permit third-party investors, silent equity positions, and non-operating ownership of Franchisee when all proposed parties and agreements are reviewed and approved by Franchisor. If Franchisee is an entity, Franchisee must designate an owner of Franchisee, having authority to act on behalf of and to bind Franchisee, to operate the Franchised Business and lead teams of C12 Area Chairs.

• c. Computer Equipment. Franchisee must possess and use a personal computer in the day-today operation of the Franchised Business in order to effectively communicate with both Franchisor and Franchisee's local C12 members. Franchisee's computer must be up to date and be able to interface with Google Workspace. Franchisee must also have the capability to print C12 materials. In order to deliver the required content at monthly forums with mixed media capability, Franchisee agrees to acquire necessary computer devices, projection, audio/video and recording equipment sufficient to project digital video and broadcast audio as Franchisor may require from time to time. Franchisee must purchase and utilize all computer hardware, software, applications, and other means of technology as Franchisor may require from time to time.

• d. Certifications, Licenses, and Insurance. Franchisee must obtain and maintain appropriate certifications, licenses, registrations, and insurance coverage as necessary to conduct business locally and based on sound business judgment. Since Franchisee is not an agent, partner, or employee of Franchisor, Franchisee shall not cause Franchisor to incur any liability or undertake any obligations, and Franchisee shall bear the cost of defense of any financial or legal claims made against Franchisee. Franchisee shall be solely responsible for any debts Franchisee incurs in the operation of the Franchised Business.

• 1. Opening for Business. Franchisee shall not commence operation of the Franchised Business unless and until (i) Franchisee has successfully completed New Chair Training, (ii) Franchisor has approved in writing of Franchisee's business plan, and (iii) Franchisor has notified Franchisee in writing that Franchisee may commence operation.
• 1. Marketing Obligations. During the first ninety (90) days after the execution of this Agreement, Franchisee must perform the following:

• a. Franchisee shall communicate with at least eight (8) new "Contacts" per week on average. A Contact is a new person (whether a prospective member or referral source of prospective members) with whom Franchisee has had two-way communication (i.e., face-to-face, phone, email, business reply card). A Contact includes those who have positively responded to mass direct marketing appeals (e.g., direct mail, broadcast email, or other mass media campaigns) and have expressed interest or requested follow-up information and/or conversation.

• b. Franchisee shall attend the Sales Training Series via teleconference and in-person Semi-Annual Chair Training. If the next Semi-Annual Chair Training is outside the aforementioned ninety-day period, Franchisee must attend the next scheduled training. During the first twelve (12) months of Franchisee's operation, Franchisee will also have access to a number of optional topical workshops and training classes.

• c. Franchisee shall launch a direct marketing campaign.

• d. Franchisee shall host an initial C12 introductory event and/or initial CEO Forum meeting in the Territory.

• e.

Source: Item 22 — CONTRACTS (FDD page 46)