Does the Circle K franchisor require approval of the lease for the franchised location?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
- 7.7 Franchised Location; Franchisor's Approval of the Lease. Franchisor must approve any lease or other agreement granting Franchisee the right to occupy the Franchised Location as contemplated hereunder (the "Lease"), and such approval will not be unreasonably withheld if the landlord ("Lessor") agrees in the Lease as follows:
- (A) The initial term, or initial term with renewal terms, must be for at least 10 years, or the term of the Franchise Agreement, whichever is longer.
- (B) The Lessor consents to Franchisee's use of the Marks and to the operation of a convenience store on the leased premises as required hereunder.
- (C) Franchisee may not (i) sublease or assign all or any part of its rights under the Lease or (ii) extend or renew the Lease, in each case witho
Source: Item 22 — CONTRACTS (FDD page 100)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, Circle K requires that any lease or agreement that grants the franchisee the right to occupy the franchised location must be approved by Circle K. However, such approval will not be unreasonably withheld if the landlord agrees to certain conditions in the lease.
The lease must have an initial term, or initial term with renewal terms, of at least 10 years, or the term of the Franchise Agreement, whichever is longer. The landlord must consent to the franchisee's use of Circle K's marks and to the operation of a convenience store on the leased premises. The franchisee is restricted from subleasing or assigning rights under the lease, or extending or renewing the lease, without the franchisor's consent.
This requirement ensures that Circle K maintains control over the locations operating under its brand. By mandating approval of the lease and setting minimum terms, Circle K protects its brand image and ensures franchisees have a stable business location. The conditions placed on the landlord and franchisee regarding subleasing, assignment, and renewal further safeguard Circle K's interests in the location and its operation.