Can Circle K modify or terminate the Competitive Allowance amount, and if so, under what conditions?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
- (iii) Seller may, at any time, in its sole discretion and upon thirty (30) days' prior written notice, modify the Competitive Allowance amount payable hereunder or terminate the obligation to make any further Competitive Allowance payment to Purchaser without any liability to Purchaser. If the Motor Fuel Agreement or this Agreement is terminated or not renewed, Seller's obligation to pay, and Purchaser's entitlement to receive, the Competitive Allowance shall immediately terminate or expire, without notice, concurrently therewith.
- (iv) Purchaser shall not be obligated to reimburse to Seller the Competitive Allowance, or any portion thereof, received from Seller.
Source: Item 23 — RECEIPTS (FDD pages 100–359)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, Circle K (referred to as Seller in this section) has the authority to modify or terminate the Competitive Allowance. The Competitive Allowance is a specified amount paid to the franchisee (referred to as Purchaser) for each gallon of product purchased from Circle K under the Motor Fuel Agreement, as detailed in the Incentive Amounts Schedule.
Circle K can modify the Competitive Allowance amount or terminate the obligation to make further payments at any time. To do so, Circle K must provide the franchisee with thirty (30) days' prior written notice. This modification or termination can occur without Circle K incurring any liability to the franchisee.
Additionally, the obligation to pay the Competitive Allowance immediately terminates or expires without notice if the Motor Fuel Agreement or the agreement detailing the Competitive Allowance is terminated or not renewed. However, the franchisee is not obligated to reimburse Circle K for any Competitive Allowance amounts already received.