Does the text mention any termination conditions for C12 Group contracts?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
ear in which this Agreement is executed. For example, if this Agreement is executed on May 31, 2024, the Term shall expire on December 31, 2025. Unless sooner terminated, as hereafter provided, the Term of this Agreement is meant to be renewed each calendar year for additional one-year Renewal Terms (with each Renewal Term being one calendar year) so long as (i) both Franchisor and Franchisee agree to such renewal, (ii) Franchisee remains active in operating the Franchised Business, and (iii) Franchisee is in good standing under this Agreement. Being in good standing requires Franchisee to remain in compliance with the terms of this Agreement and Franchisee's agreement to any updates or changes in Franchisor's business model and Operations Manual that have occurred during the prior year. Any changes made in Franchisor's business model will be made at Franchisor's sole discretion and based on Franchisor's belief that the changes will strengthen the overall platform and enhance the C12 Group franchise system's long-term value to both members and franchisees. There is no additional renewal fee associated with these annual renewals. If there are material updates or changes, Franchisor may present Franchisee with a consent letter incorporating such terms, which shall act to renew this Agreement for another calendar year. Franchisor shall notify Franchisee of material changes to Royalty Fees and minimum membership fees (as the basis for calculating Royalty Fees) at least twelve (12) months before the expiration of the Term or any Renewal Term.
Franchisee shall notify Franchisor of Franchisee's intent to not renew the Term of this Agreement no later than ninety (90) days prior to the expiration of the Term, as may be renewed. If Franchisee elects to not renew the Term of this Agreement, Franchisee shall take all reasonable steps necessary to ensure the continuity of the Franchised Business or, if Franchisor decides to wind down the Franchised Business in Franchisor'
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, there are several conditions that could lead to the termination of the franchise agreement. The agreement has an initial term that extends through December 31st of the year following the agreement's execution. Renewal occurs each calendar year if both C12 Group and the franchisee agree, the franchisee is active, and the franchisee remains in good standing by complying with the agreement and any updates to C12 Group's business model or Operations Manual.
C12 Group may reduce the size of a franchisee's territory, authorize another franchisee within that territory, or operate a C12 Group business within the franchisee's territory if the franchisee fails to meet minimum performance standards. Additionally, if the franchisee engages in 'poaching' by soliciting prospective C12 members who live and work in another franchisee's territory, C12 Group considers this a material breach of the agreement and grounds for termination upon notice.
Furthermore, if the franchisee is an entity, C12 Group may terminate the agreement if the designated owner and officer of the franchisee who meets C12 Group's ongoing training requirements (a "C12 Area Chair") is no longer in that role and a suitable replacement is not found and approved by C12 Group. These termination conditions highlight the importance of maintaining compliance, meeting performance standards, and adhering to C12 Group's policies to avoid potential termination of the franchise agreement.