What is the significance of the power of attorney being 'coupled with an interest' for Circle K?

According to the 2025 Circle K Franchise Disclosure Document, the power of attorney granted to TMC FRANCHISE CORPORATION is 'coupled with an interest,' making it irrevocable. This is significant because it means that the franchisee (DEBTOR) cannot revoke the power of attorney once it's granted. This power allows TMC FRANCHISE CORPORATION to act on behalf of the franchisee under specific circumstances, particularly during a default or event of default.

Specifically, TMC FRANCHISE CORPORATION can sell, transfer, or otherwise deal with the collateral as if it were the absolute owner, ensuring they can protect and realize their security interest. They can also file financing statements, including signing them on behalf of the franchisee, if necessary. This arrangement is designed to protect Circle K's interests in the collateral provided by the franchisee, giving them broad authority to manage and dispose of the assets if the franchisee fails to meet their obligations.

The FDD also clarifies that TMC FRANCHISE CORPORATION has no duty to exercise these powers, and they are only accountable for the amounts they actually receive from exercising them. Furthermore, neither TMC FRANCHISE CORPORATION nor its representatives are liable to the franchisee for any actions or failures to act, except in cases of gross negligence or willful misconduct. This protects Circle K from liability while ensuring they have the necessary authority to manage the collateral in case of a default, which is a common practice in franchising to protect the franchisor's investment and brand integrity.