Shaq, Papa Johns agree to $5.6 million renewal deal

Shaquille O’Neal has scored a new multi-million dollar endorsement deal with Papa Johns that, among other things, assures his signature Shaq-A-Roni pizza can produce personal and charitable rewards. The contract, which Papa Johns detailed in a filing with the federal Securities and Exchange Commission this week, will pay the Basketball Hall of Famer $5.625 million over three years. It will also pay O'Neal—a spokesman and board member for Papa Johns since 2019—a royalty fee for Shaq-A-Roni pizza sales that kicks in if those sales exceed his annual pay, at a rate of 20 cents per item sold. Based on an average yearly salary of $1.875 million and a Shaq-A-Roni pizza retail price of $13, that perk would pay off after Papa Johns sells about 144,000 Shaq-A-Roni pizzas. The restaurant chain sold more than 3 million Shaq-A-Roni pizzas over a promotion during September and October of last year, CEO Robert Lynch told analysts in a conference call in November. “Shaq-A-Roni was a big success for us,” he said, both as a means to win new customers but also because of an associated charitable element that supports the company’s brand and values. O'Neal takes credit for creating the Shaq-A-Roni, which is a 16-inch pizza with extra cheese and pepperoni, and a thin crust served in eight slices, compared to 10 for typical Papa Johns’ pies. Sales revenue from the product supports charities supported by O'Neal and the brand. In the U.S., a donation of $1 per pizza sold will support The Papa John’s Foundation for Building Community. One Canadian dollar for each unit sold in Canada will be donated to a charity mutually agreed upon between the parties, the filing said. Papa Johns receives the right and license to use O’Neal’s name, nickname, initials, autograph, voice, video or film portrayals, photographs, likeness and certain other intellectual property rights. Enter the 2022 Small Agency Awards at AdAge.com/SAA2022 The endorsement deal, which has substantially the same terms as the one it succeeds, became effective March 15. It also grants O’Neal 55,898 restricted stock units, which can be converted into stock over the course of the three-year contract. O’Neal joined Papa Johns’ board in June of 2019, taking an interest in nine Atlanta-area franchises at the same time. The company at that time was overcoming the repercussions of an ugly split with its founder and former CEO John Schnatter that hurt its reputation both as a sports marketer and with Black consumers. In 2017, Schnatter’s remarks over Colin Kaepernick’s social protests and their effect on the chain’s NFL sponsorships triggered controversy; a year later, he used a racial slur in a marketing training call that eventually led to his departure from the company. O’Neal encountered controversy for his role with the brand a year ago when the proxy firm Institutional Shareholder Services reportedly called for his ouster over a spotty attendance record at board meetings. RSVP for Ad Age In-Depth: TV Pivot on May 24 and 25 at AdAge.com/TVPivot

Shaq, Papa Johns agree to $5.6 million renewal deal

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