The information in this article pertains solely to the Toppers Pizza franchise based in the United States. Nothing in this article relates to Topper’s Franchising in Canada, which is a completely separate entity.

If you are considering a Toppers Pizza franchise, don’t get blindsided by these 30 important franchise fees (from the initial franchise fee, to the royalty fee, to 28 other fees found in Items 5 and 6 of Toppers Pizza’s 2023 FDD).

1.  Initial Franchise Fee:  $30,000

• • The initial franchise fee under each Franchise Agreement is $30,000. The initial franchise fee is due in a lump sum and fully earned by Toppers when you sign your Franchise Agreement, and is non-refundable except as described below.

• If Toppers determines that you and/or your owners have insufficient prior experience in operating a restaurant, then, in addition to the initial training program described in Item 11, Toppers may require you and your manager(s) to attend, at your cost, such additional training as it deems necessary (“New Operator Training”).

• If you and your manager(s) do not complete all New Operator Training to Toppers’ satisfaction, it may terminate the Franchise Agreement, in which case it would, upon receipt of a general release in a form satisfactory to it from you and your owners, refund you $10,000 of the initial franchise fee.

• If you are eligible and opt to participate in the Sponsorship Program, you will pay a reduced initial franchise fee of $15,000, which amount will be payable under the Sponsorship Note, which will have a ten-year term.

• Toppers is a member of the International Franchise Association (“IFA”) and participates in the IFA’s VetFran Program. If you are a veteran of the U.S. Armed Forces qualified under the VetFran Program, Toppers will reduce the initial franchise fee for your first Toppers Pizza Restaurant by $10,000 from the then-current initial franchise fee.

2.  Project Management Fee:  $7,500

• If you are opening your first Toppers Pizza restaurant, Toppers requires you to enter into the Project Management Agreement at the same time you sign the Franchise Agreement. Under the Project Management Agreement, Toppers will provide you with Project Management Assistance.

• The fee for Project Management Assistance is $7,500, payable to Toppers in 3 equal installments upon completion of certain milestones. The first installment is due upon the later of the date you sign the Project Management Agreement or the date Toppers approves your proposed location. The second installment is due upon completion of the rough-in inspection. The third installment is due upon completion of the project closeout (punch list) inspection.

• Each installment is fully earned by Toppers upon completion of the relevant milestone, and is non-refundable.

3.  Opening Extension Fee:  $5,000

• Under the Franchise Agreement, you must acquire possession of a location for your Restaurant within 180 days after signing the Franchise Agreement and have your Restaurant open and operating within 180 days after signing the lease or acquiring the location.

• If you fail to meet the deadline to open your Restaurant and you wish to extend the deadline, Toppers may grant you a one-time, six-month extension to have your Restaurant open and operating. In exchange for Toppers granting you this opening extension, you agree to pay Toppers a non-refundable extension fee of $5,000.

4.  Software License and Installation of Point-of-Sale System:  varies

• Before you open your Restaurant, you must license proprietary POS software directly from Toppers (known as “PiZMET”). The current cost for the PiZMET software site license is $2,500 per Restaurant, which is fully earned by Toppers upon payment and is non-refundable.

• In addition, Toppers requires you to pay it an installation fee for your POS system. Toppers estimates the installation fee to be $2,000 to $5,000, depending on the complexity of the installation and Toppers’ travel costs. The installation fee is fully earned by Toppers before it installs the POS system and is nonrefundable.

• Toppers may choose to outsource the installation of the POS system, in which case any installation fees would be payable to the third-party installer.

5.  Area Development Fee for Restaurants to Be Developed Under Area Development Agreement:  varies

• If you sign an Area Development Agreement, you will be required to pay an Area Development Fee. The Area Development Fee equals (1) 100% of the initial franchise fee due under the first Franchise Agreement you are required to sign plus (2) 50% of the initial franchise fees Toppers currently charges for the remaining Toppers Pizza Restaurants to be developed.

• Typically, an area developer is expected to develop 2 to 5 Restaurants and the range of the Area Development Fee is $45,000 to $90,000. However, it may be higher depending on the number of Restaurants to be developed.

• Toppers will apply the Area Development Fee as a credit against the initial franchise fees due under each Franchise Agreement which you must sign under the Area Development Agreement.

6.  Continuing Royalty:  5.5% of Gross Sales

• Due Date:  Every Friday, for Gross Sales from the previous week (defined as Monday through Sunday).

7.  Brand Development Fund Fee:  currently, 3.3% of Gross Sales

• Due Date:  Every Friday, for Gross Sales from the previous week (defined as Monday through Sunday).

• If you fail to meet your minimum local advertising expenditure requirement during an annual period, Toppers Pizza may require you to pay the difference between the amount you were required to spend and your actual local advertising expenditures to the Brand Development Fund, within three months of the end of the annual period.

8.  Additional Investor-Owner Training:  $300 to $500 per day for each trainee, plus travel and living expenses

• Due Date:  Before investor-owner training begins.

• If a new direct or indirect owner obtains an interest in you, the new owner must attend investor-owner training, and you must pay Toppers’ then-current fee for investor-owner training.

• You will pay all travel and living expenses during additional investor-owner training.

9.  Additional Initial Training:  $300 to $500 per day for each trainee, plus travel and living expenses

• Due Date:  Before additional initial training begins.

• If you send more than 2 people to initial training, or if you or any of your trainees fail to successfully complete Toppers’ initial training program, you will pay Toppers $300 to $500 per day for each additional trainee.

• You will pay all travel and living expenses during additional initial training.

10.  Initial On-Site Training and Opening Support:  actual travel and living expenses for Toppers’ training personnel sent to your Restaurant

• Due Date:  Upon Toppers’ issuance of an invoice after completion of on-site training.

• Depending upon your experience, Toppers will provide 7 to 28 days of additional on-site training and opening support for your first Restaurant (7 to 14 days if you or an affiliate already operate a Restaurant) immediately before, at the time of, and just after the opening of the Restaurant.

• This training will be at no extra charge; however, you must pay the travel and living expenses of each trainer Toppers sends.

11.  Additional On-Site Training:  $300 to $500 per day per trainer, plus actual travel and living expenses incurred by the trainers Toppers sends

• Due Date:  Upon completion of additional onsite training.

• You may request or Toppers may require additional on-site training. Toppers is not obligated to provide this additional on-site training, but if it does, it will impose a daily fee of $300 to $500 per trainer for each additional day of training you request or Toppers requires, plus actual travel and living expenses incurred by the trainers Toppers sends.

12.  Optional Supplementary Training:  training fee to be established, and all travel and living expenses

• Due Date:  At time of training.

• Toppers may provide optional supplementary training, which you may elect to attend, for which Toppers may establish a training fee to be paid by you. You will also pay all travel and living expenses for your trainees.

13.  Relocation Review Fee:  $1,500

• Due Date:  Upon Toppers’ request.

• To offset Toppers’ costs in evaluating your planned relocation.

14.  Transfer Fee – Franchise Agreement:  $10,000 if the proposed transfer is to a new franchisee who is not currently operating a Toppers Pizza Restaurant; otherwise $5,000 if the proposed transfer is to a franchisee who is currently operating a Toppers Pizza Restaurant

• Due Date:  Before transfer.

• Toppers will charge no transfer fee if the transfer is to an existing owner of you (if you are a business entity) or to members of your (or your owner’s) immediate family, but it may require you to reimburse it for any direct costs it incurs in documenting and processing the transfer, including its reasonable legal fees.

• If you are a multi-unit owner and transfer multiple restaurants to a new franchisee in the same transaction, then the transfer fee will be $10,000 each for the first two restaurants and $5,000 for each additional restaurant.

15.  Transfer Fee – Area Development Agreement:  $10,000

• Due Date:  Before transfer.

• Toppers will charge no transfer fee if the transfer is to an existing owner of you (if you are a business entity) or to members of your (or your owner’s) immediate family, but it may require you to reimburse it for any direct costs it incurs in documenting and processing the transfer, including its reasonable legal fees.

16.  Interest:  18% per year or the highest commercial lending rate that the law allows on amounts owed to Toppers or to its affiliates that are considered delinquent.

• Due Date:  Upon Toppers’ request.

17.  Audit Costs and Interest:  cost of audit, plus a percentage of interest on underpayments

• Due Date:  Upon determination of the amount due.

• Payable if an audit reveals an understatement exceeding 0.5% of the Gross Sales reported for any period.

18.  Testing and Evaluation Fee:  Toppers’ then-current fee (currently, the fee will not exceed the actual cost of the test)

• Due Date:  Upon your request that Toppers review alternate products or supplies.

19.  Contributions to a Cooperative:  not currently charged

• Due Date:  Every Friday, for Gross Sales from the previous week (defined as Monday through Sunday).

• Currently, you are required to participate in the Toppers Cooperative Advertising Association.

• Your contributions to the Toppers Cooperative Advertising Association will be credited against your local advertising requirement.

20.  Technology Fee:  currently, 2% of your Online Gross Sales. Toppers may increase the Technology Fee to a maximum of 2.5% of your Online Gross Sales.

• Due Date:  Every Friday, for Gross Sales from the previous week (defined as Monday through Sunday).

• This fee is used in Toppers’ discretion toward maintaining and enhancing technology services and may be used to pay for costs and expenses such as, but not limited to, an “Online Ordering System,” hosting fees, third-party professional services, software fees, software maintenance fees, support services, and security.

• “Online Gross Sales” means Gross Sales derived from orders placed through the Online Ordering System.

21.  POS System Fees:  currently, $208.33 per month

• Due Date:  Monthly.

• If Toppers requires you to sign the POS Subscription Agreement, you will pay Toppers for PiZMET site maintenance at an annual cost of $1,900 (payable in equal monthly installments of $158.33).

• In addition, Toppers requires you to have access to its required enterprise reporting software, which costs $50 per month and is payable to Toppers.

22.  Inspection:  the greater of $500 or the actual cost of re-inspection if you fail an inspection

• Due Date:  As incurred.

• If you fail an inspection, a re-inspection will be conducted, and Toppers may withdraw by ACH the greater of $500 or the cost of the re-inspection (or any subsequent re-inspection).

23.  Quality and Service Training:  Toppers’ then-current fee for each person assigned to your Restaurant (currently $300 to $500 per person), plus travel and living expenses

• Due Date:  As incurred.

• If you fail to maintain the standards of quality or service established by Toppers, it has the right to assign to your Restaurant individuals it deems necessary for the training of your employees to ensure that standards of quality and service are maintained.

24.  Additional Printed Materials:  cost of any printed materials ordered on your behalf, plus delivery fees. The materials ordered on your behalf will typically cost between $100 and $200.

• Due Date:  As incurred.

• Toppers reserves the right to order and have shipped to your Restaurant, menus, menu boards, food preparation posters, sales material, systems advertising material, and other marketing material on your behalf and invoice you (or debit your account by ACH) for such items and their delivery.

25.  Costs and Attorneys’ Fees:  will vary under circumstances

• Due Date:  As incurred.

• Due prevailing party in any legal proceeding or arbitration.

26.  Indemnification:  will vary under circumstances

• Due Date:  As incurred.

• You must reimburse Toppers and its affiliates if any of them are held liable for claims related to your Restaurant’s operations.

27.  Insurance Premiums/Rent:  will vary under circumstances

• Due Date:  As incurred.

• If you do not pay your insurance premiums or rent, Toppers or its affiliates can pay them for you and you must reimburse the payor.

• Rent includes any payments required under your lease.

28.  Damages:  will vary under circumstances

• Due Date:  As incurred.

29.  Assumption of Management:  10% of Gross Sales, plus costs and expenses

• Due Date:  As incurred.

• Toppers may assume management of your Restaurant, if: (1) you abandon or fail to actively operate your Restaurant; (2) you fail to comply with any provision of the Franchise Agreement or any system standard and do not cure the failure within the specified time period; or (3) the Franchise Agreement expires or is terminated and Toppers is deciding whether to exercise its option to purchase your Restaurant.

30.  Toppers’ Cure of Your Default:  will vary under circumstances

• Due Date:  As incurred.

• If you default in the performance of any of your obligations or breach any term or condition of the Franchise Agreement or any related agreement, Toppers may cure the default or breach on your behalf. Toppers will collect the amount it expends in curing the default from you.