Does the text prohibit any actions related to C12 Group contracts?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees to not own an interest or participate in any business viewed as competitive, injurious, or incompatible with Franchisor and the C12 Franchised Business. Franchisee agrees to engage in the C12 Franchised Business as Franchisee's primary vocation with no other vocational interests that may materially adversely impair Franchisee's ability to perform Franchisee's obligations hereunder.
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- Post-Termination Non-Competition. For two (2) years after the termination of this Agreement for any reason, Franchisee shall not directly or indirectly own an interest in or otherwise be employed by or engaged with a Competitive Business within the Territory, within ten (10) miles of the Territory, within the territory of any other C12 franchise, or within ten (10) miles of the territory of any other C12 franchise. For purposes of this Section, a "Competitive Business" is any business that offers peer mentorship and coaching to Christian business leaders. The post-termination non-competition obligations under this Section shall not apply if Franchisee pays Franchisor the Exit Fee described above.
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- Non-Solicitation of Members. Fra
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 C12 Group FDD, there are certain restrictions and stipulations regarding franchisee behavior, particularly concerning competition and member solicitation. During the term of the agreement, franchisees are prohibited from owning an interest in or participating in any business viewed as competitive, injurious, or incompatible with C12 Group. Franchisees must also commit to the C12 franchised business as their primary vocation, ensuring that no other vocational interests materially impair their ability to fulfill their obligations under the agreement. These measures aim to protect C12 Group's market position and ensure franchisees remain dedicated to the brand.
Post-termination, for a period of two years, franchisees are restricted from owning an interest in or being employed by a Competitive Business within their former territory, within ten miles of that territory, or within or near any other C12 franchise territory. A Competitive Business is defined as one that offers peer mentorship and coaching to Christian business leaders. This non-compete clause is waived if the franchisee pays C12 Group an Exit Fee. Additionally, franchisees are prohibited from soliciting members after termination. These covenants are designed to prevent former franchisees from leveraging their knowledge and relationships gained during their time with C12 Group to unfairly compete with the franchise system.
These restrictions have significant implications for prospective franchisees. They must be prepared to fully commit to the C12 Group business during the term of the agreement and understand the limitations on their activities post-termination. The non-compete clause, while standard in many franchise agreements, could restrict a franchisee's future business opportunities. The option to pay an Exit Fee to waive this clause provides some flexibility but represents an additional cost to consider. Prospective franchisees should carefully evaluate these restrictions and their potential impact on their long-term career and business goals.