What sections of the Franchise Agreement relate to engaging other qualified personnel in a C12 Group franchise?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
The Principal Chair must be actively involved in the day-to-day operation of your franchise as a fullytrained Principal Chair (FA Sections IV, XVIII) and pursue effective stewardship in addressing the full market potential available in your assigned Territory as You serve local Christian business owners, CEOs, and presidents. Although it is possible to engage other qualified and fully-trained personnel in serving your Territory's demand as a part of your C12 practice (FA Sections I, IV, IX), you must remain active in the role of Principal Chair to retain the franchise. If the franchise is owned by an entity (e.g., a corporation, limited liability company, or partnership), then the franchise must be operated by someone who is an owner and officer of such an entity (a "Principal") and who has met all the on-going requirements of a fullytrained C12 Principal Chair (FA Sections X, XVIII). If circumstances should ever change such that such Principal is no longer both an owner and officer of such entity and such entity does not have a suitable replacement candidate for the role of C12 Principal Chair (contingent on C12's approval), then the franchise must be operated by the Principal Chair, or, failing that, transferred to C12 (at C12's option), an approved third-party (at C12's discretion), or terminated (FA Sections VIII, X).
C12 permits third party investors, silent equity positions, and non-operating ownership of a C12 franchise when all parties and agreements are reviewed and approved by C12. A non-operating ownership entity may designate a Principal Chair to operate the franchise and lead teams of Area Chairs as long as agreements and assignments are approved by C12 in writing. This includes the stipulation that C12 must approve and train all subsequent Area Chairs (whether designated as Principal Chairs by responsibility or not). The allowance is to both support capitalizing franchise launches as well as succession and liquidation of franchisees upon exit scenarios.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 35–36)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, Item 15 addresses the franchisee's obligation to participate in the actual operation of the franchise business and references sections of the Franchise Agreement that relate to engaging other qualified personnel. Specifically, it mentions that while it is possible to engage other qualified and fully-trained personnel in serving the Territory's demand as part of the C12 Group practice, the franchisee must remain active as the Principal Chair to retain the franchise (FA Sections I, IV, IX).
The FDD states that if the franchise is owned by an entity, it must be operated by a Principal who is an owner and officer of the entity and meets the requirements of a fully trained C12 Principal Chair (FA Sections X, XVIII). If the Principal is no longer both an owner and officer, the entity must have a suitable replacement candidate approved by C12 Group. Otherwise, the franchise must be operated by the Principal Chair, transferred to C12 Group or an approved third party, or terminated (FA Sections VIII, X).
C12 Group permits third-party investors, silent equity positions, and non-operating ownership of a C12 Group franchise, subject to C12 Group's review and approval of all parties and agreements. A non-operating ownership entity may designate a Principal Chair to operate the franchise and lead teams of Area Chairs, provided that C12 Group approves the agreements and assignments in writing. This includes the stipulation that C12 Group must approve and train all subsequent Area Chairs, whether designated as Principal Chairs or not. This allowance supports capitalizing franchise launches and succession and liquidation of franchisees upon exit scenarios.