EXHIBIT 10.3


 


MARKETING ASSISTANCE AGREEMENT


 


Papa
John’s International, Inc. (“PJI”), as Franchisor, and the undersigned,
individually and on behalf of the Franchisee, hereby agree to the following:


 


1.                                       PJI
will contribute funds to the Franchisee on the terms and conditions set forth
in the attached Marketing Assistance Requirements, which is incorporated herein
by reference.


 


2.                                       This
program is a special accommodation implemented at the discretion of PJI in
response to a request from Franchisee. 
The Franchise Agreements pursuant to which Franchisee operates Papa John’s
restaurants (“Franchise Agreements”) shall continue according to their terms
and conditions, and this program shall not constitute an amendment to any such
agreement.


 


3.                                       In
exchange for these commitments, which Franchisee expressly acknowledges
constitute valuable consideration and are not required under the terms of any
agreement with PJI, Franchisee releases PJI and its subsidiaries, officers and
directors (“Releasees”) from any and all claims it may have against any such
Releasee, provided this shall not release PJI from its obligations under
current franchise agreements.


 


4.                                       Any
dispute regarding the Marketing Assistance program or this document shall be
resolved in the same manner as other disputes as set forth in the Franchise
Agreements.


 


IN WITNESS
WHEREOF, the parties have executed this Agreement as of the dates set forth
below:


 


	
  PAPA
  JOHN’S INTERNATIONAL, INC.

  	
  PJ
  UNITED, INC.

  
	
   

  	
   

  
	
  By:

  	
  /s/ Charles W.
  Schnatter

  	
   

  	
  By:

  	
  /s/ Doug
  Stephens

  
	
   

  	
   

  	
  Doug Stephens,
  President

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice
  President and Chief

  	
   

  	
   

  	
   

  
	
   

  	
  Development
  Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
  March 1,
  2004

  	
   

  	
  Date:

  	
  February 27,
  2004

  



 


 


Attachment:  2004 PJ United, Inc. Marketing Assistance
Requirements — Revised 2/17/04


 





















 


2004
PJ UNITED, INC. MARKETING ASSISTANCE


 


REQUIREMENTS


 


All 16 restaurants owned by the Franchisee in
the Portland, Oregon DMA, including Vancouver, WA and Corvallis (“DMA”) must
participate and follow all requirements detailed below:


 


MARKETING


 


•                  Franchisee’s
total marketing investment must be a minimum of 8% of Net Sales effective January 1,
2004 through December 31, 2004. 
This includes any required co-op contribution, national marketing fund
contribution, and local restaurant marketing (LRM).


 


•                  Co-op
contributions and corporate assistance dollars will be used primarily to
purchase electronic broadcast advertising (TV and radio).


 


•                  PJI
must approve the use of any advertising or marketing firm used by the
Franchisee.  Any firm used must follow
Papa John’s International (PJI) guidelines for media buying, and media buys
must be audited by Media Management Inc. to ensure the effective investment of
the marketing dollars.


 


•                  All
marketing by the Franchisee must be approved by PJI prior to commitment,
whether placed through an advertising or marketing firm or placed directly.


 


•                  Franchisee
must provide to PJI a monthly P&L statement, including details on the types
and costs of all marketing activities.


 


•                  The Regional Marketing Director is
the key point person in maintaining this process, with support from the
Regional Franchise Director. The Regional Marketing Director will review the
co-op marketing and media plans with the Senior Director of National Field
Marketing and Media prior to placement.


 


OPERATIONS


 


•                  All
of Franchisee’s restaurants must successfully pass Papa John’s Mission Critical
Evaluations according to Papa John’s policy. 
The Franchisee’s restaurants must maintain a 70% or above average,
computed by period, on the Mission Critical Evaluation (MCE).  If the Franchisee fails to average a minimum
70% on all evaluations completed in a given period, the Franchisee will be
given a probationary period to improve its MCE scores.  If the Franchisee fails to average 70% or
above during the “probationary period”, PJI will suspend the marketing
contribution, beginning with the next cancelable media flight, until the
Franchisee reaches a 70% on the MCE for an entire period (i.e. if the group
falls below 70% average for a period, the program will be suspended beginning with
the next cancelable media flight, and all periods after that until the
Franchisee improves it’s average MCE score to above 70%.)  This clause is for the Franchisee’s average,
not individual store averages.


 


•                  Inclusion
in the Assistance Program does not exclude restaurants from any portion of PJI’s
PRIMSERVE program.


 





















 


•                  All
of Franchisee’s restaurants must successfully complete PJI’s SCRUB program, or
provide the AFD/RFD with confirmation of scheduled contractor work to be
completed before the end of Q2’04. 
AFD/RFD will determine compliance by completing store reviews.  Any store note in compliance at the end of Q2’04
will force suspension of the entire program until all restaurants are brought
into SCRUB compliance.


 


•                  Any
restaurant not meeting Mission Critical Performance must adopt and adhere to an
approved M.C. Action Plan.


 


DOCUMENTATION


 


•                  Implementation
of this program is conditioned upon Franchisee signing and returning the
document and the attached Marketing Assistance Agreement


 


TERMS
OF ASSISTANCE


 


•                  The
assistance will be paid quarterly commencing with the first quarter of 2004 (January through
March), and ending with the fourth quarter of 2004 (October through
December).


 


•                  The
contribution from PJI shall be based on total sales upon which Royalties are
actually received in cash by PJI for each quarter from the franchisee’s 16
stores in the DMA (no other restaurants or markets are included).


 


•                  The
quarterly contribution shall be equivalent to the following percentage of total
restaurant sales upon which Royalties are actually received in cash by PJI:


 


	
  Quarterly

  PSA

  	
   

  	
  Marketing

  Assistance

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Below $12,000

  	
   

  	
  4

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  $12,001 — $12,500

  	
   

  	
  2

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  $12,501 — $13,000

  	
   

  	
  1

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  Over $13,000

  	
   

  	
  0

  	
  %

  



 


•                  PJI
may terminate the program beginning with the next cancelable media flight if:
(1) any restaurant is closed without express written consent of PJI’s Chief
Development Officer, not to be unreasonably withheld; or (2) any claim or
lawsuit arises between PJI and Franchisee.