What documents must a Circle K franchisee execute to obtain Incentive / Conversion Funding?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
e same construction allowance as described at the time you signed your RFD Agreement.
Motor Fuel Business
We offer an Incentive / Conversion Funding Program for our Motor Fuel Business offering. Below is a summary of the Incentive / Conversion Funding Program. If you accept Incentive / Conversion Funding from us, you will sign an Incentive and Amortization Agreement, Promissory Note, Security Agreement (form copies of each are attached as Exhibit 6 to the Motor Fuel Agreement (which is Exhibit G to this Disclosure Document)) and the Personal Guaranty (a sample copy of which is included as Exhibit J to the Franchise Disclosure Document) that you sign in connection with the Convenience Store Franchise Agreement will apply to your obligations under the Incentive/Conversion Funding Program.
| Average Gross Sales (last 12 months) | Equipment/Construction Funding Available |
|---|---|
| $50,000 or less | Up to 0.8 times Gross Sales |
| $50,001 to $75,000 | Up to 0.9 times Gross Sales |
| $75,001 to $100,000 | Up to 1.1 times Gross Sales |
| $100,001 to $150,000 | Up to 1.2 times Gross Sales |
| $150,001+ | Up to 1.3 times Gross Sales |
Notes:
- (1) The amount of Incentive / Conversion Funding offered will depend on the condition of the Business including, the amount of necessary improvements and branding requirements.
- (2) The term of the loan will vary depending on each particular loan and the related circumstances (Section 6 of Incentive and Amortization Agreement).
Source: Item 10 — FINANCING (FDD pages 55–60)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, to obtain Incentive / Conversion Funding for the Motor Fuel Business, a franchisee must sign several agreements. These include an Incentive and Amortization Agreement, a Promissory Note, and a Security Agreement. Form copies of each of these agreements are attached as exhibits to the Motor Fuel Agreement, which itself is an exhibit to the Disclosure Document.
In addition to these documents, the Personal Guaranty that the franchisee signs in connection with the Convenience Store Franchise Agreement will also apply to the franchisee's obligations under the Incentive/Conversion Funding Program. This includes obligations related to the Security Agreement and the Promissory Note. The Security Agreement covers items such as accounts, inventory, equipment, furniture, fixtures, tangible property, general intangibles, chattel paper, and other instruments, with a sample copy included as an exhibit to the Incentive and Amortization Agreement.
It's important for prospective Circle K franchisees to carefully review all these documents with legal and financial advisors. Understanding the terms of each agreement, especially the conditions under which the Incentive / Conversion Funding can be accelerated or defaulted, is crucial. A default under the Incentive and Amortization Agreement constitutes a default under the Motor Fuel Agreement, potentially leading to significant financial and operational repercussions for the franchisee.