Under what circumstances does the Circle K agreement terminate upon the expiration of the term?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon expiration of the Term, Licensee will have the option to renew its rights under this Agreement consistent with any renewal option Licensee elects under the terms of its CIRCLE K Franchise Agreement ("Franchise Agreement") governing the Premises (as defined below) (the "Renewal Term") provided Licensee has complied with all of the following conditions:
- (A) Licensee has given TMC written notice of its request for a new license at least six (6) months prior to the expiration of the Term.
Licensee's failure to timely provide written notice to TMC will be deemed a rejection of the option to renew or operate pursuant to a new license.
TMC will not unreasonably withhold its approval of such request for an offer of a new license, provided the conditions set forth in this Section 2 have been satisfied.
(B) Licensee meets TMC's then-current requirements for new licensees.
(C) Licensee has complied in good faith with all material terms and conditions of this Agreement throughout the Term of this Agreement and is not in default of this Agreement or any other agreement with TMC or its affiliates.
(D) TMC and Licensee execute a mutual release of all claims relating to this Agreement subject to any incomplete performance or continuing obligations, unless such releases are prohibited by applicable law.
Source: Item 23 — RECEIPTS (FDD pages 100–359)
What This Means (2025 FDD)
According to the 2025 Circle K Franchise Disclosure Document, the Circle K Branding Agreement will expire upon the expiration of the Franchise Agreement. However, the Licensee has the option to renew their rights under the Circle K Branding Agreement if they elect to renew their Circle K Franchise Agreement.
To renew the Circle K Branding Agreement, the Licensee must provide written notice to TMC Franchise Corporation at least six months before the expiration of the current term. The Licensee must also meet TMC's current requirements for new licensees and have complied with all material terms and conditions of the Branding Agreement throughout its term, remaining free of any defaults. Additionally, both TMC and the Licensee must execute a mutual release of all claims related to the agreement, unless such releases are prohibited by law.
If the Licensee fails to provide timely written notice, it will be considered a rejection of the option to renew. However, TMC will not unreasonably withhold approval of a new license if all specified conditions are met. This ensures that franchisees who maintain good standing and meet the necessary requirements have a reasonable opportunity to continue their relationship with Circle K.