Does Circle K offer financing through a secured promissory note?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
If any provision of this Note, or the application of it to any party or circumstance, is held void, invalid, or unenforceable by a court of competent jurisdiction, the
Exhibit G - Motor Fuel Agreement – Exhibit 2 – Incentive and Amortization Agreement – Exhibit A (Secured Promissory Note) CK 2024 Multi-State FDD G-2-14
remainder of this Note, and the application of such provision to other parties or circumstances, shall not be affected thereby, the provisions of this Note being severable in any such instance. Maker represents and warrants to Payee that the proceeds of this Note will be used solely for business, commercial investment, or similar purposes, and that no portion of it will be used for personal, family, or household purposes. The parties agree that this Note and the Loan Documents are a product of their joint effort. As a result, any rules of construction, including but not limited to Civil Code section 1654 and the rule that a contract should be construed against the drafter, shall not apply.
Source: Item 23 — RECEIPTS (FDD pages 100–359)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, Circle K utilizes secured promissory notes as part of its financing arrangements. Specifically, Exhibit A of the Incentive and Amortization Agreement is a Secured Promissory Note. TMC Franchise Corporation, a subsidiary of Circle K Stores, Inc., may extend funding or credit to franchisees through a Credit Agreement, which may involve promissory notes. These notes are part of the obligations the debtor (franchisee) owes to TMC Franchise Corporation. The proceeds from these notes are to be used solely for business, commercial investment, or similar purposes, and not for personal, family, or household use.
The Security Agreement outlines the obligations of the franchisee (DEBTOR) to TMC Franchise Corporation, covering all indebtedness and liabilities, whether direct or indirect, arising from the Franchise Agreement, Motor Fuel Agreement, or Credit Agreement. This includes any promissory notes or instruments associated with these agreements. The agreement specifies that it is governed by the Uniform Commercial Code of the relevant state, ensuring that the security interests are legally enforceable.
Furthermore, the FDD states that if any part of the promissory note is deemed void or unenforceable, the remaining provisions will still apply. This severability clause ensures that the rest of the agreement remains in effect. The agreement also clarifies that it is a product of joint effort, meaning that any rules of construction that would typically construe a contract against the drafter do not apply, ensuring a balanced interpretation of the document.