For Circle K franchisees, what agreements are included under the term 'Obligations'?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
- (c) The term "Obligations," as used herein, means all of the indebtedness, obligations and liabilities of DEBTOR to TMC FRANCHISE CORPORATION, individually or collectively, whether direct or indirect, joint or several, absolute or contingent, due or to become due, now existing or hereafter arising in any manner or at any time, including those arising under or in respect of the Circle K Franchise Agreement entered into between TMC FRANCHISE CORPORATION and DEBTOR (the "Franchise Agreement"), Motor Fuel Agreement entered into between TMC FRANCHISE CORPORATION and DEBTOR], any agreement or agreements by which TMC FRANCHISE CORPORATION extends any funding or credit to DEBTOR, no matter how such agreement is denominated (the "Credit Agreement"), any promissory notes or other instruments or agreements executed and delivered pursuant thereto or in connection therewith or this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 100–359)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, the term "Obligations" in the Security Agreement encompasses all financial responsibilities and liabilities that a franchisee (referred to as DEBTOR) owes to TMC Franchise Corporation. These obligations can arise in various forms, whether direct or indirect, and can be related to different agreements. This definition is important because it establishes the scope of the security interest granted to TMC Franchise Corporation, meaning that the franchisor has a claim on the franchisee's assets to the extent of these defined obligations.
The obligations include any indebtedness, liabilities, and responsibilities the franchisee has towards TMC Franchise Corporation. These can be joint or individual, absolute or conditional, and can be currently due or due in the future. The obligations also include those that arise under or are related to the Circle K Franchise Agreement itself.
Furthermore, the definition extends to obligations arising from the Motor Fuel Agreement between TMC Franchise Corporation and the franchisee, as well as any agreements related to funding or credit provided by TMC Franchise Corporation, regardless of how these agreements are named. This includes any promissory notes or other financial instruments associated with these agreements. In essence, "Obligations" is a broad term designed to capture all possible financial liabilities of the franchisee to TMC Franchise Corporation under various agreements.