Under what condition is a transfer deemed to occur for a C12 Group franchise?

According to the 2025 C12 Group Franchise Disclosure Document, a transfer of the franchise is deemed to occur when more than fifty percent (50%) of the equity ownership of the franchisee is sold or transferred to a third party, calculated from the date of the Franchise Agreement. This means that if a franchisee initially owns 100% of the business, selling or transferring more than 50% of that ownership to someone else is considered a transfer under the terms of the agreement.

This provision is important for prospective C12 Group franchisees because it outlines the circumstances under which the franchisor's approval is required for changes in ownership. If a franchisee plans to sell a significant portion of their business, they need to be aware that it triggers the transfer clause, requiring them to seek approval from C12 Group. This approval process may involve evaluating the qualifications of the new owner, assessing their business plan, and ensuring they complete the necessary training.

Furthermore, the FDD states that such a sale or transfer will result in the franchisee or the transferee executing C12 Group's then-current form of franchise agreement, which may contain terms materially different than the original agreement. The franchisor may also require a $6,000 transfer fee and potentially a training fee if the transferee is not an existing C12 Group franchisee. Therefore, franchisees need to consider these costs and potential changes to the franchise agreement when contemplating a transfer of ownership.