When Papa John’s signed Shaquille O’Neal to a major partnership one year ago that included nine franchises and a board seat, it was seen as a major turning point for the brand. The company had spent $50 million in 2018 to scrub founder John Schnatter’s face from pizza boxes and delivery vans, and O’Neal, a high-demand product endorser, will clearly be the marketing face of the brand moving forward.
But now a proxy firm wants O’Neal off the board for missing too many board meetings.
Institutional Shareholder Services (ISS), a corporate governance advisory firm, is encouraging Papa John’s (PZZA) shareholders to vote against O’Neal’s reelection to the board at the April 23 shareholders meeting because he attended fewer than 75% of meetings in his first term as a board member.
Shares of Papa John’s were down 1.75% on Monday afternoon amid a market rally. The stock is down 22% in 2020 so far.
Papa John’s, in its SEC filing in advance of the April 23 meeting, disclosed that every board member attended at least 75% of the board’s 16 meetings in 2019, “except for Shaquille O’Neal, who was unable to attend several board meetings due to prior business and broadcasting commitments made prior to Mr. O’Neal’s appointment to the Board, which could not be rescheduled.” If O’Neal did not make it to 75% of 16 meetings, it means he missed at least five meetings.
Papa John’s added in its SEC filing that the company and O’Neal “do not expect these scheduling conflicts to recur in 2020.” Yahoo Finance reached out to a representative for O’Neal for further comment.
In August, O’Neal told Yahoo Finance that he has been a fan of Papa John’s since college, and that when he did his homework on the corporate side of the brand, “I realized that there was a problem there: they didn’t have any diversity on the board.” He met with then-CEO Steve Ritchie and activist investor Jeff Smith of Starboard Capital and told them, “I would like to be involved, if I can be on the board and if I can purchase a couple franchises.”
Daniel Roberts is an editor-at-large at Yahoo Finance. Follow him on Twitter at @readDanwrite.
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