What is the deadline for opening a Circle K Conversion Store after the Effective Date?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
2.1 Non-Exclusive License; Franchised Location; Store Opening. Subject to the terms and conditions herein, Franchisor hereby grants to Franchisee, and Franchisee hereby accepts, a non-exclusive license to establish and operate, during the Term, a Circle K Store, in conformity with the Business System, using the Marks (the "License"), at the location described in the Data Sheet attached hereto as Exhibit 1 (the "Franchised Location"). Franchisee agrees that the Store shall be constructed in accordance with the requirements of this Agreement and should be ready
to open within: (i) 1 year after the Effective Date, if the Store is a Conversion Store; or (ii) 2 years after the Effective Date, if the Store is a New Store. A failure to open a Conversion Store within one year or a New Store within two years will entitle Franchisor to immediately terminate this Agreement without Franchisor incurring any liability for such termination. If this Agreement is so terminated, Franchisee must comply with all post-termination obligations set forth herein, including but not limited to the payment of Liquidated Damages.
Source: Item 22 — CONTRACTS (FDD page 100)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, if a franchisee is opening a Conversion Store, it should be ready to open within one year after the Effective Date. The Effective Date is the date the Franchise Agreement is executed.
Failing to open the Conversion Store within the one-year timeframe entitles Circle K to immediately terminate the Franchise Agreement. If Circle K terminates the agreement due to the franchisee's failure to open the store on time, the franchisee must comply with all post-termination obligations. These obligations include the payment of Liquidated Damages.
Liquidated Damages are calculated based on a formula in Section 5.2 of the agreement. The franchisee will have to pay the average monthly Royalty Fee payments for a specified period. This period is either the 12 months preceding the termination or a shorter period commencing with the Effective Date of the agreement if the termination occurs within the first year. The amount is multiplied by the lesser of 48 or the remaining number of months under the term.