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Papa John's prohibits founder John Schnatter from talking to the press, ejects him from headquarters

Key Points
  • Papa John's created a special committee of independent directors to evaluate the relationship and arrangements between the company and its founder.
  • The special committee ordered the termination of Schnatter's "Founder Agreement," which designated him as the face of the company's advertising and marketing.
  • It also asked the board to end Schnatter's sublease agreement, which granted him the right to use office space in Papa John's corporate headquarters in Kentucky.
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Papa John's founder John Schnatter resigns as chairman after N-word comment

Papa John's continued to distance itself from founder John Schnatter over the weekend, prohibiting him from talking to the press, removing him from the pizza chain's advertising materials and revoking his office space at the company's headquarters.

"The company has specifically requested that Mr. Schnatter cease all media appearances, and not make any further statements to the media regarding the company, its business or employees," Papa John's said in a press release late Sunday.

The company created a special committee of independent directors to evaluate the ties between Papa John's and its founder after he admitted last week to using a racially charged slur during a May conference call.

The committee terminated Schnatter's "Founder Agreement," which designated him as the face of the company's advertising and marketing, and terminated his sublease agreement for office space at Papa John's Louisville, Kentucky, headquarters.

Schnatter resigned as CEO in December and stepped down as chairman last week after several media blunders that started last fall when he blamed the NFL for its "poor leadership" in handling player protests during the national anthem.

Schnatter, who according to FactSet owns a nearly 30 percent stake in Papa John's, remains on the company's board.

Papa John's CEO Steve Ritchie announced a number of steps Friday that the company is taking to regain customer trust. Executives will visit local shops to hold a series of "listening sessions" with employees and are conducting an outside audit of its business to gauge diversity efforts.

The special committee will oversee this audit, the company said.