<PAGE>

                           SCHEDULE 14A INFORMATION

          Proxy Statement Pursuant to Section 14(a) of the Securities
                    Exchange Act of 1934 (Amendment No.  )
        
Filed by the Registrant [X]

Filed by a Party other than the Registrant [_] 

Check the appropriate box:

[X]  Preliminary Proxy Statement         [_]  CONFIDENTIAL, FOR USE OF THE
                                              COMMISSION ONLY (AS PERMITTED BY
                                              RULE 14A-6(E)(2))

[_]  Definitive Proxy Statement 

[_]  Definitive Additional Materials 

[_]  Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

                        Papa John's International, Inc.
- --------------------------------------------------------------------------------
               (Name of Registrant as Specified In Its Charter)


- --------------------------------------------------------------------------------
   (Name of Person(s) Filing Proxy Statement, if other than the Registrant)

   
Payment of Filing Fee (Check the appropriate box):

[X]  No fee required

[_]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

   
     (1) Title of each class of securities to which transaction applies:

     -------------------------------------------------------------------------


     (2) Aggregate number of securities to which transaction applies:

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     (3) Per unit price or other underlying value of transaction computed
         pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
         the filing fee is calculated and state how it was determined):

     -------------------------------------------------------------------------
      

     (4) Proposed maximum aggregate value of transaction:

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     (5) Total fee paid:

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[_]  Fee paid previously with preliminary materials.
     
[_]  Check box if any part of the fee is offset as provided by Exchange
     Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
     was paid previously. Identify the previous filing by registration statement
     number, or the Form or Schedule and the date of its filing.
     
     (1) Amount Previously Paid:
 
     -------------------------------------------------------------------------


     (2) Form, Schedule or Registration Statement No.:

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     (3) Filing Party:
      
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     (4) Date Filed:

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<PAGE>
 
                                PRELIMINARY COPY



                           [Better Ingredients Logo]



                                 P.O. Box 99900
                        Louisville, Kentucky  40269-9990



                                                                  April 10, 1997

Dear Stockholder:

     On behalf of the entire Papa John's team, I invite you to join us for the
Company's upcoming Annual Meeting of Stockholders.  The meeting will begin at
11:00 a.m. on Thursday, May 22, 1997, at the Hyatt Regency Hotel, 320 West
Jefferson Street, Louisville, Kentucky.

     Following the formal items of business to be brought before the meeting, we
will discuss our 1996 results and answer your questions.  After the meeting, we
hope you will join us for a slice of the Perfect Pizza!

     Thank you for your continued support of Papa John's.  We look forward to
seeing you on May 22nd.

                                       Sincerely,



                                       John H. Schnatter
                                       Founder and Chief Executive Officer

<PAGE>
 
                        PAPA JOHN'S INTERNATIONAL, INC.
                                 P.O. Box 99900
                        Louisville, Kentucky  40269-9990


                    NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
                            TO BE HELD MAY 22, 1997

To the Stockholders:

     The Annual Meeting of Stockholders of Papa John's International, Inc. (the
"Company") will be held at the Hyatt Regency Hotel, 320 West Jefferson Street,
Louisville, Kentucky on Thursday, May 22, 1997, at 11:00 a.m. (E.D.T.), for the
following purposes:

     (1) To elect three directors to serve until the annual meeting of
         stockholders in 2000 and one director to serve until the annual meeting
         of stockholders in 1999;

     (2) To amend the Company's Certificate of Incorporation to increase the
         number of shares of common stock authorized;

     (3) To consider and approve amendments to the Papa John's
         International, Inc. 1993 Stock Ownership Incentive Plan;

     (4) To ratify the selection of Ernst & Young LLP as the Company's
         independent auditors for the fiscal year ending December 28, 1997; and

     (5) To transact such other business as may properly come before the meeting
         or any adjournment thereof.

     A Proxy Statement describing matters to be considered at the Annual Meeting
is attached to this Notice.  Only stockholders of record at the close of
business on March 26, 1997, are entitled to receive notice of and to vote at the
meeting.

                                       By Order of the Board of Directors



                                       Charles W. Schnatter
                                       Senior Vice President, Secretary
                                        and General Counsel
Louisville, Kentucky
April 10, 1997


                                   IMPORTANT

WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE MARK, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENVELOPE WHICH HAS BEEN PROVIDED.
IN THE EVENT YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE YOUR
SHARES IN PERSON.

<PAGE>
 
                        PAPA JOHN'S INTERNATIONAL, INC.
                                 P.O. Box 99900
                        Louisville, Kentucky  40269-9990

                                  ----------

                                PROXY STATEMENT

                         ANNUAL MEETING OF STOCKHOLDERS
                            TO BE HELD MAY 22, 1997

                                  ----------

                              GENERAL INFORMATION

          This Proxy Statement and accompanying proxy card are being furnished
in connection with the solicitation of proxies by the Board of Directors (the
"Board") of Papa John's International, Inc., a Delaware corporation (the
"Company"), to be voted at the Company's Annual Meeting of Stockholders (the
"Annual Meeting") and any adjournments thereof.  The Annual Meeting will be held
at the Hyatt Regency Hotel, 320 West Jefferson Street, Louisville, Kentucky on
Thursday, May 22, 1997, at 11:00 a.m. (E.D.T.) for the purposes set forth in
this Proxy Statement and the accompanying Notice of Annual Meeting.  This Proxy
Statement and accompanying proxy card are first being mailed to stockholders on
or about April 10, 1997.

          A stockholder signing and returning a proxy has the power to revoke it
at any time before the shares subject to it are voted by (i) notifying the
Secretary of the Company in writing of such revocation, (ii) filing a duly
executed proxy bearing a later date or (iii) attending the Annual Meeting and
voting in person.  If a proxy is properly signed and returned to the Company and
not revoked, it will be voted in accordance with the instructions contained
therein.  Unless contrary instructions are given, the proxy will be voted FOR
the nominees for director named in the Proxy Statement, FOR the amendment to the
Company's Certificate of Incorporation, FOR the amendments to the 1993 Stock
Ownership Incentive Plan, FOR the ratification of Ernst & Young LLP as the
Company's independent auditors for the 1997 fiscal year and, in the discretion
of proxy holders, on such other business as may properly come before the Annual
Meeting.

          The original solicitation of proxies by mail may be supplemented by
telephone and other means of communication and through personal solicitation by
officers, directors and other employees of the Company, at no compensation.
Proxy materials are being distributed by Corporate Investor Communications, Inc.
for a fee of approximately $1,500.  Proxy materials will also be distributed
through brokers, custodians and other like parties to the beneficial owners of
the Company's Common Stock, par value $.01 per share (the "Common Stock"), and
the Company will reimburse such parties for their reasonable out-of-pocket and
clerical expenses incurred in connection therewith.

<PAGE>
 
                       RECORD DATE AND VOTING SECURITIES

          The Board has fixed the record date (the "Record Date") for the Annual
Meeting as the close of business on March 26, 1997, and all holders of record of
Common Stock on this date are entitled to receive notice of and to vote at the
Annual Meeting and any adjournment thereof.  A list of stockholders entitled to
vote at the Annual Meeting will be available for inspection by any stockholder
for any purpose reasonably related to the Annual Meeting for a period of ten
days prior to the Annual Meeting at the Company's principal executive offices at
11492 Bluegrass Parkway, Louisville, Kentucky.  At the Record Date, there were
____________ shares of Common Stock outstanding.  For each share of Common Stock
held on the Record Date, a stockholder is entitled to one vote on each matter to
be considered at the Annual Meeting.  A majority of the outstanding shares
present in person or by proxy is required to constitute a quorum to transact
business at the meeting.

          Votes cast by proxy or in person at the Annual Meeting will be
tabulated by the inspectors of election appointed for the meeting, who also will
determine whether a quorum exists.  Abstentions or "withheld" votes will be
treated as present and entitled to vote for purposes of determining a quorum,
but as unvoted for purposes of determining the approval of matters submitted to
the stockholders.  Since Delaware law treats only those shares voted "for" a
matter as affirmative votes, abstentions or withheld votes will have the same
effect as negative votes or votes "against" a particular matter.  If a broker
indicates that it does not have discretionary authority as to certain shares to
vote on a particular matter, such shares will not be considered as present and
entitled to vote with respect to that matter.

             SECURITY OWNERSHIP OF MANAGEMENT AND PRINCIPAL HOLDERS

          The following table sets forth certain information as of the Record
Date with respect to the beneficial ownership of the Common Stock by (i) each
director or nominee for director of the Company, (ii) each of the executive
officers named in the Summary Compensation Table in this Proxy Statement, (iii)
all directors and executive officers as a group and (iv) each person known to
the Company to be the beneficial owner of more than 5% of the outstanding Common
Stock.

<TABLE> 
<CAPTION>
                                                     Number of     Percent of
        Directors and Executive Officers             Shares(1)      Class(2)
        --------------------------------             ---------      --------
<S>                                                  <C>            <C> 
John H. Schnatter
P.O. Box 99900
Louisville, Kentucky  40269-9990.................   8,892,523(3)         ____%
Charles W. Schnatter.............................     415,584(4)          ___%
Wade S. Oney.....................................     271,896(5)            *
Blaine E. Hurst..................................      45,409(6)            *
E. Drucilla Milby................................      20,426(7)            *
O. Wayne Gaunce..................................      62,007(8)            *
Jack A. Laughery.................................      35,250(9)            *
Michael W. Pierce................................      49,872(10)           *
Richard F. Sherman...............................     113,253(11)           *
 
All directors and executive officers as a group
(13 persons, including those named above)........  10,014,090(12)        ____% 
</TABLE>
 

                                      -2-

<PAGE>
 

Other 5% Beneficial Owners

Janus Capital Corporation
100 Fillmore Street
Denver, Colorado  80206-4923......................   4,035,676(13)         ___%
Pilgrim Baxter & Associates, Ltd.
1255 Drummers Lane, Suite 300
Wayne, Pennsylvania  19087.......................   2,859,275(13)         ___%
Putnam Investments, Inc.
One Post Office Square
Boston, Massachusetts  02109.....................   1,627,987(13)         ___%

- ----------------------------

*  Represents less than 1% of class.

(1)  Based upon information furnished to the Company by the named persons, and
     information contained in filings with the Securities and Exchange
     Commission (the "Commission").  Under the rules of the Commission, a person
     is deemed to beneficially own shares over which the person has or shares
     voting or investment power or which the person has the right to acquire
     beneficial ownership within 60 days.  Unless otherwise indicated, the named
     persons have sole voting and investment power with respect to shares shown
     as owned by them.
(2)  Based on _______ shares outstanding as of March 26, 1997, the Record Date
     for the Annual Meeting.
(3)  Includes 34,390 shares subject to options exercisable within 60 days of the
     Record Date.
(4)  Includes (a) 22,002 shares subject to options exercisable within 60 days of
     the Record Date, (b) 2,790 shares held in a trust for Mr. Schnatter's minor
     children as to which Mr. Schnatter has neither voting nor investment power
     and (c) 65,000 shares held by a partnership in which Mr. Schnatter shares
     voting and investment power.
(5)  Includes 263,340 shares subject to options exercisable within 60 days of
     the Record Date.
(6)  Includes 38,909 shares subject to options exercisable within 60 days of the
     Record Date.
(7)  Includes 17,594 shares subject to options exercisable within 60 days of the
     Record Date.
(8)  Includes (a) 37,125 shares subject to options exercisable within 60 days of
     the Record Date; (b) 6,150 shares held in a trust in which Mr. Gaunce is
     trustee with voting and investment power; (c) 6,882 shares which Mr. Gaunce
     is deemed to beneficially own through a corporation; and (d) 2,250 shares
     held by Mr. Gaunce's spouse, as to which shares Mr. Gaunce disclaims
     beneficial ownership.
(9)  Includes (a) 31,500 shares subject to options exercisable within 60 days of
     the Record Date, and (b) 3,750 shares held by Mr. Laughery's spouse, as to
     which shares Mr. Laughery disclaims beneficial ownership.
(10) Includes (a) 9,000 shares held by a partnership in which Mr. Pierce has a
     50% interest, as to which Mr. Pierce shares voting and investment power,
     (b) 114 shares held by Mr. Pierce's spouse, as to which shares Mr. Pierce
     disclaims beneficial ownership, and (c) 40,500 shares subject to options
     exercisable within 60 days of the Record Date.
(11) Includes 107,153 shares subject to options exercisable within 60 days of
     the Record Date and 6,100 shares held in a trust in which Mr. Sherman's
     daughter is trustee.
(12) Includes 649,895 shares subject to options exercisable within 60 days of
     the Record Date held by all directors and executive officers.
(13) As disclosed in a Schedule 13G filed with the Commission.  Reflects
     beneficial ownership (based on sole or shared voting or dispositive power)
     of the reporting entity and its affiliates as of December 29, 1996.

                                      -3-

<PAGE>
 
                           1.  ELECTION OF DIRECTORS

     The Company's Certificate of Incorporation provides for a classified board
of directors, with three classes of directors each nearly as equal in number as
possible.  Each class serves for a three-year term and one class is elected each
year.  The Board of Directors is authorized to fix the number of directors
within the range of three to fifteen members, and the Board size is currently
fixed at seven members.  Messrs. Gaunce, Laughery and Pierce are the members of
the class to be elected at the Annual Meeting and have been nominated to serve
as directors for a three-year term expiring at the annual meeting to be held in
2000.  Mr. Hurst was elected a director of the Company in October 1996 to serve
for a term expiring at the 1997 Annual Meeting and has been nominated for
election to serve for a two-year term expiring at the annual meeting to be held
in 1999.  The remaining three directors will continue to serve in accordance
with their previous elections.

     It is intended that shares represented by proxies received in response to
this Proxy Statement will be voted for the nominees listed below, unless
otherwise directed by a stockholder in his or her proxy.  Although it is not
anticipated that any of the nominees will decline or be unable to serve, if that
should occur, the proxy holders may, in their discretion, vote for a substitute
nominee or nominees.  Directors are elected by a plurality of the votes cast.

     Set forth below is information concerning the nominees and the other
directors who will continue in office, each of whom is currently a member of the
Board.

<TABLE>
<CAPTION>
 
                                                                       Director
Name                                    Age    Position or Office       Since
- ----                                    ---    ------------------      --------
<S>                                    <C>     <C>                     <C>
 
 NOMINEES FOR ELECTION TO THE BOARD
 For a 3-Year Term Expiring in 2000

O. Wayne Gaunce.......................  63     Director                   1993

Jack A. Laughery......................  62     Director                   1993

Michael W. Pierce.....................  45     Director                   1993

 For a 2-Year Term Expiring in 1999

Blaine E. Hurst.......................  40     President and Director     1996

  DIRECTORS CONTINUING IN OFFICE
      Term Expiring in 1999

John H. Schnatter.....................  35     Founder, Chairman of       1990
                                               the Board and Chief
                                               Executive Officer
 
      Term Expiring in 1998

Charles W. Schnatter..................  34     Senior Vice President,     1993
                                               Secretary, General
                                               Counsel and Director
 
Richard F. Sherman....................  53     Director                   1993
</TABLE>


                                      -4-

<PAGE>
 
          John H. Schnatter.  John Schnatter created the Papa John's concept and
founded the Company in 1985.  He has served as Chairman of the Board and Chief
Executive Officer since 1990, and from 1985 to 1990, served as President.  He
has been a Papa John's franchisee since 1986.

          Blaine E. Hurst.  Blaine Hurst has served as President since October
1996 and from February 1995 to October 1996, he served as Chief Information
Officer of the Company after having joined the Company in January 1995 as Vice
President of Information Systems.  From 1993 to 1995, Mr. Hurst was Vice
President of Information Systems for Boston Chicken, Inc.  From 1989 to 1993,
Mr. Hurst was a consulting partner with Ernst & Young.  He has been a Papa
John's franchisee since 1996.

          Charles W. Schnatter.  Charles Schnatter has served as General Counsel
and Secretary since 1991 and has been a Senior Vice President of the Company
since 1993.  From 1988 to 1991, he was an attorney with Greenebaum Doll &
McDonald PLLC, Louisville, Kentucky, a law firm which provides legal services to
the Company.  He has been a Papa John's franchisee since 1989.  Mr. Schnatter
serves on the board of directors of PJ America, Inc.

          Richard F. Sherman.  Mr. Sherman is a private investor who has been a
Papa John's franchisee, and a consultant to the Company, since 1991.  From 1987
to 1991, Mr. Sherman was Chairman and President of Rally's Hamburgers, Inc.
From 1984 to 1987, Mr. Sherman was President and a director of Church's Chicken,
Inc.  From 1971 to 1984, Mr. Sherman was Group Executive Vice President and
Director of Hardee's Food Systems, Inc. and its parent Imasco USA, Inc.  Mr.
Sherman serves on the board of directors of Taco Cabana, Inc., Hartz
Restaurants, Inc. and Reed's Jewelers, Inc. and is Chairman of the Board of PJ
America, Inc.

          O. Wayne Gaunce.  Since 1988, Mr. Gaunce has been the principal of
Gaunce Management, which oversees the operation of franchised restaurants,
including Papa John's, Long John Silver's and Jerry's restaurants.  For more
than the past five years, Mr. Gaunce has also developed and managed real estate
properties, principally in the restaurant industry.  Mr. Gaunce has been a Papa
John's franchisee since 1991. Mr. Gaunce serves on the board of directors of
Trans Financial, Inc.

          Jack A. Laughery.  Mr. Laughery is a restaurant investor and
consultant, and has been a Papa John's franchisee since 1992.  From 1990 until
his retirement in 1994, Mr. Laughery was Chairman of Hardee's Food Systems, Inc.
From 1962 to 1990, Mr. Laughery was employed by Hardee's Food Systems, Inc.,
retiring as Chief Executive Officer in 1990.  Mr. Laughery serves on the board
of directors of First Union Corporation, Mass Mutual Corporate Investors and
Mass Mutual Participation Investors.

          Michael W. Pierce.  Since 1987, Mr. Pierce has been President of
Arkansas Investment Group, Inc., which operates Rally's Hamburgers franchised
restaurants in central Arkansas.  Since 1992, Mr. Pierce has been President of
Arkansas Pizza Group, Inc., a Papa John's franchisee.  Since 1996, Mr. Pierce
has been President of Missouri Pizza Group, LLC, a Papa John's franchisee, and
Highbar Management Group, Inc. which provides management services.  From 1974 to
1985, Mr. Pierce was involved in real estate development and construction,
including development of restaurant properties.

          John and Charles Schnatter are brothers.  There are no other family
relationships among the Company's directors, executive officers and other key
personnel.
  
                                      -5-

<PAGE>
 
Meetings of the Board of Directors

          The Board met on seven occasions during 1996.  Each director attended
at least 75% of the meetings of the Board and its committees on which such
director served during his period of service in 1996.

Committees of the Board of Directors

          In addition to an Executive Committee, which is comprised of John
Schnatter, Charles Schnatter and Richard Sherman, the Board of Directors has
standing Compensation and Audit Committees.  The Board does not have a
nominating committee or other committee serving a similar function.

          The Compensation Committee is currently comprised of Messrs. Gaunce,
Laughery and Sherman. The functions of the Compensation Committee are to review
and approve annual salaries and bonuses for all corporate officers and
management personnel, review, approve and recommend to the Board of Directors
the terms and conditions of all employee benefit plans and administer the 1993
Stock Ownership Incentive Plan. The Compensation Committee met three times in
1996.

          The Audit Committee is comprised of Charles Schnatter and Messrs.
Sherman and Pierce. The functions of the Audit Committee are to recommend
annually to the Board of Directors the appointment of the independent auditors
of the Company, discuss and review the scope and the fees of the prospective
annual audit and review the results thereof with the independent auditors,
review and approve non-audit services of the independent auditors, review
compliance with accounting and financial policies of the Company, review the
adequacy of the financial organization of the Company and review management's
procedures and policies relative to the adequacy of the Company's internal
accounting controls and compliance with federal and state laws relating to
accounting practices. The Audit Committee met three times in 1996.

Compensation of Directors

          Directors who are not also employees of the Company are eligible to
participate in the Company's 1993 Non-Employee Directors Stock Option Plan (the
"Director Plan"). Under the terms of the Director Plan, non-employee directors
who do not otherwise hold options to purchase shares of Common Stock upon their
initial election to the Board of Directors are awarded options to purchase
27,000 shares of Common Stock upon joining the Board. Each non-employee director
(regardless of option ownership) is then eligible to receive an additional 9,000
options after three years of continuous Board service. The options are granted
at fair market value and vest in equal one-third installments upon the earlier
of each subsequent annual meeting of stockholders or the anniversary of the
option grant date. In addition, non-employee directors who serve on the
Executive Committee of the Board receive an annual award of 7,500 options (at
fair market value and with a two-year vesting schedule).

          Non-employee directors also receive reimbursement of reasonable out-
of-pocket expenses incurred in connection with their attendance at Board and
Committee meetings.  Directors who are employees of the Company do not receive
additional compensation for services rendered as a director.

          Mr. Sherman is compensated at a rate of $5,000 per month, plus group
health insurance coverage, for providing consulting services to the Company.
See "Compensation Committee Interlocks and Insider Participation."
  
                                      -6-

<PAGE>
 
                             EXECUTIVE COMPENSATION

          The following table sets forth information concerning the annual and
long-term compensation paid, earned or accrued by the Company's Chief Executive
Officer and its next four most highly compensated executive officers for
services rendered in all capacities to the Company for the years indicated.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                               Annual Compensation           Long-Term Compensation
                                      -----------------------------------    -----------------------
                                                                                    Awards
                                                                                    ------
                                                                  Other      Restricted    Securities
                                                                 Annual        Stock       Underlying      All Other
Name and                                                      Compensation     Awards         Stock       Compensation
Principal Position           Year     Salary($)     $Bonus($)    ($)(1)       ($)(2)       Options(#)       ($)(3)
- ---------------------------  ----     --------      --------  ------------   ----------    ----------     ------------
<S>                          <C>      <C>          <C>            <C>             <C>            <C>         <C> 
John H. Schnatter..........  1996     $ 99,000      $      0      $16,265           0         85,278        $383,700
  Founder, Chairman and      1995      121,365        13,125       13,788           0         22,500         394,226
  Chief Executive Officer    1994      162,500        84,375           --           0         45,000              --

Charles W. Schnatter.......  1996     $155,000      $ 22,500           --           0         83,564              --
  Senior Vice President,     1995      146,442         7,000           --           0         17,438              --
  Secretary and General      1994      120,000        46,000           --           0         22,500              --
  Counsel                                                                                             

Wade S. Oney(4)............  1996     $150,000      $115,000           --           0        187,305              --
  Chief Operating Officer    1995      141,500       111,200           --    $150,000        108,755              --

Blaine E. Hurst(4).........  1996     $191,346      $ 32,500           --           0        249,000              --
 President                   1995      142,116         3,500      $69,955           0         43,313              --

E. Drucilla Milby..........  1996     $149,904      $ 25,000           --           0         78,122              --
 Chief Financial Officer     1995      108,750        17,250           --                     14,063              --
 and Treasurer               1994       86,250        30,375           --           0         13,500              --
- --------------------------
</TABLE>


(1) Except as otherwise indicated, perquisites and other personal benefits paid
    to each named executive officer were less than 10% of the officer's annual
    salary and bonus. The amount reported for John Schnatter in 1996 includes an
    automobile allowance of $7,800, tax preparation services valued at $8,270
    and group term life insurance premiums of $195. The amount reported to Mr.
    Hurst in 1995 includes reimbursement for moving expenses of $65,905 and an
    automobile allowance of $4,050.

(2) Represents the value of shares of Common Stock awarded under the Company's
    1993 Stock Ownership Incentive Plan, which shares are restricted as to
    transferability for a period of six months after the date of award. There
    was no restricted stock outstanding held by the named executive officers at
    the Company's 1996 fiscal year-end. The aggregate restricted stock holdings
    of the named executive officers at the Company's 1995 fiscal year-end
    consisted of 5,625 shares held by Wade Oney, as to which shares the
    restrictions lapsed on June 28, 1996.

(3) Represents premiums advanced by the Company for the purchase of split-dollar
    life insurance coverage for John Schnatter. The premiums will be recovered
    by the Company out of the cash value or proceeds from the policy.

(4) First became an executive officer of the Company in 1995. Accordingly,
    disclosure with respect to previous years is not required under applicable
    Commission rules. Mr. Oney's bonus in 1995 includes a one-time signing bonus
    of $25,000.

                                      -7-

<PAGE>
 
                       OPTION GRANTS IN LAST FISCAL YEAR

     The following table sets forth information as to stock options granted to
the named executive officers during the 1996 fiscal year. The Company does not
grant stock appreciation rights ("SARs").

<TABLE>
<CAPTION>
                                                                                           Potential
                                                                                        Realizable Value
                          Number of          % of                                          at Assumed
                          Securities    Total Options                                    Annual Rates of
                          Underlying      Granted to     Exercise or                       Stock Price
                           Options       Employees in    Base Price   Expiration         Appreciation for
Name                      Granted(1)     Fiscal Year      ($/Share)      Date             Option Term(2)
- ----------------------   -----------    -------------    -----------  ----------   --------------------------
<S>                     <C>             <C>             <C>           <C>          <C>             <C>
                                                                                      5% ($)         10% ($)
                                                                                    ----------     ----------
John H. Schnatter.....     75,000(3)         3.7%          $26.83      08/15/06     $1,265,250     $3,207,000
                           10,278(4)          .5            17.22      01/04/06        139,781        282,028
Charles W. Schnatter..     75,000(3)         3.7            26.83      08/15/06      1,265,250      3,207,000
                            8,564(4)          .4            17.22      01/04/06        116,470        234,996
Wade S. Oney..........     48,268(5)         2.4            32.50      06/30/06        986,598      2,500,282
                           49,026(6)         2.8            33.83      09/29/06      1,043,273      2,643,482
                           46,491(7)         2.3            29.75      03/31/06        869,847      2,204,138
                           43,520(8)         2.1            32.56      12/29/06        891,290      2,258,253
Blaine E. Hurst.......     75,000(3)         3.7            26.83      08/15/06      1,265,250      3,207,000
                            5,250(9)          .3            17.22      01/04/06         71,400        144,060
                          168,750(10)        8.3            18.22      02/01/06      1,933,875      4,900,500
E. Drucilla Milby.....     75,000(3)         3.7            26.83      08/15/06      1,265,220      3,207,000
                            3,122(4)          .2            17.22      01/04/06         42,459         85,668
- --------------------------
</TABLE>

(1)  All options were awarded under the 1993 Stock Ownership Incentive Plan,
     have a term of 10 years and vest immediately in the event of a change in
     control of the Company.
(2)  Assumed annual appreciation rates are set by the Securities and Exchange
     Commission and are not a forecast of future appreciation.  The amounts
     shown are pre-tax and assume the options will be held throughout the entire
     ten-year term.  If Papa John's Common Stock does not increase in value
     after the grant date of the options, the options are valueless.
(3)  These options become exercisable in five annual installments of 10%, 10%,
     20%, 25% and 35% beginning on August 15, 1997.
(4)  These options become exercisable in four equal semi-annual installments
     beginning June 30, 1996.
(5)  These options were granted pursuant to Mr. Oney's employment agreement and
     became exercisable December 30, 1996.
(6)  These options were granted pursuant to Mr. Oney's employment agreement and
     became exercisable March 29, 1997.
(7)  These options were granted pursuant to Mr. Oney's employment agreement and
     became exercisable October 1, 1996.
(8)  These options were granted pursuant to Mr. Oney's employment agreement and
     become exercisable June 29, 1997.
(9)  These options become exercisable as follows:  1,313 shares each on June 30,
     1996 and December 29, 1996, and 1,312 shares each on June 29, 1997 and
     December 27, 1997.
(10) These options become exercisable in five annual installments of 10%, 10%,
     20%, 25% and 35% beginning February 1, 1997.

                                      -8-

<PAGE>
 
                      AGGREGATED OPTION EXERCISES IN LAST
                 FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

          Set forth below is information with respect to option exercises by the
named executive officers in the 1996 fiscal year and unexercised stock options
held by the named executive officers at the end of the Company's 1996 fiscal
year.  There were no SARs outstanding at the 1996 fiscal year-end.


<TABLE>
<CAPTION>
                                                     Number of Securities
                                                    Underlying Unexercised       Value of Unexercised
                                                           Options at           In-the-Money Options at
                           Shares                      Fiscal Year-End(#)        Fiscal Year-End($)(2)
                          Acquired       Value     --------------------------  --------------------------
Name                     On Exercise  Realized(1)  Exercisable  Unexercisable  Exercisable  Unexercisable
- ---------------------    -----------  -----------  -----------  -------------  -----------  -------------
<S>                      <C>          <C>          <C>          <C>            <C>          <C>
John H. Schnatter.....                                31,820       120,958      $  587,878    $1,287,429
Charles W. Schnatter..                                19,861       103,641         320,018       943,708
Wade S. Oney..........                               214,314       106,496       1,998,580       207,694
Blaine E. Hurst.......                                16,220       276,093         255,537     3,723,305
E. Drucilla Milby.....       2,400      $70,824       15,013        96,072         382,422       848,734
- -----------------------------
</TABLE>


(1)  The Value Realized represents the difference between the fair market value
     on the date of exercise and the total option price.
(2)  Based on the difference between the option exercise price and the last
     reported sale price of the Common Stock ($32.5625) as reported on The
     Nasdaq Stock Market on December 27, 1996, the last trading day of the
     Company's 1996 fiscal year.

Employment Agreement

          Wade Oney serves as Chief Operating Officer pursuant to an Employment
Agreement with the Company dated March 31, 1995, as amended (the "Employment
Agreement").  Mr. Oney was paid a signing bonus of $25,000 at the time the
Employment Agreement was entered into and is paid an annual salary of $150,000.
In addition, Mr. Oney is eligible to earn an annual bonus of up to $100,000 and
quarterly option awards ("Base Options") based on the achievement of operating
and sales targets at Company-owned restaurants.  Base Options are awarded with
an exercise price equal to the fair market value of the Common Stock at the date
of award.  If the exercise price of the Base Options exceeds $11.11, this excess
(the "Excess Option Price") will be used to calculate the award of additional
options to Mr. Oney.  The number of additional options, which are also awarded
at fair market value, will equal five times the number of Base Options,
multiplied by the ratio of the Excess Option Price to the Base Option exercise
price.

          Prior to his promotion to Chief Operating Officer, entities in which
Mr. Oney owned an equity interest were awarded franchise and development rights
to develop a total of 29 Papa John's restaurants in Orlando, Tampa and Southeast
Florida.  See "Compensation Committee Interlocks and Insider Participation --
Franchise and Development Arrangements."  Under the terms of the Employment
Agreement, the Company loaned one such franchise entity $500,000 at 1/4% below 
the prime rate solely for the development and operation of Papa
John's restaurants.  As of February 23, 1997, the outstanding principal balance 
of the loan was $430,556 and Mr. Oney's franchise groups had opened 17 of the 29
restaurants.

          The Employment Agreement terminates December 28, 1997.  In the event
Mr. Oney does not continue in the position of Chief Operating Officer subsequent
to December 28, 1997, his employment will be continued on mutually agreed terms
through December 26, 1999, to permit the vesting of certain options previously
awarded to Mr. Oney.

                                      -9-

<PAGE>
 
            COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

          The following report includes a discussion of the Compensation
Committee's philosophy on executive compensation, the primary components of the
Company's compensation program and a description of the Chief Executive
Officer's compensation package during 1996.

          Compensation Principles.  The Compensation Committee is responsible
for advising the Board of Directors on matters relating to the compensation of
the Company's executive officers and administering the Company's 1993 Stock
Ownership Incentive Plan (the "Incentive Plan").  The Compensation Committee
believes the following principles are important in compensating executive
officers:

     .Compensation awarded by the Company should be effective in attracting,
      motivating and retaining key executives;

     .Incentive compensation should be awarded based on the achievement of 
      growth or operational targets at the Company, its subsidiaries or
      restaurants, as appropriate to the executive officer; and

     .Executive officers should have an equity interest in the Company to 
      encourage them to manage the Company for the long-term benefit of 
      stockholders.

          The Company's executive officers are compensated through a combination
of salary, stock options or cash bonuses and awards under the Incentive Plan,
each of which is discussed below.

          Annual Salary.  The Committee reviews salary levels on an annual basis
with the Chief Executive Officer and the Company's other senior managers, and
makes adjustments as appropriate or necessary to keep employees motivated.  The
Committee gives great weight to the Chief Executive Officer's recommendations as
to annual salary levels of the Company's executive officers.

          Bonus Program.  During 1996, certain officers and employees within the
Company's restaurant operations, commissary and equipment areas, including
several executive officers, were eligible to receive bonuses based on the
attainment of operational goals during the fiscal year. The operational goals
include targeted sales and profits at the restaurant or commissary level, or on
a Company-wide basis, depending upon the employee's position, or the opening of
a targeted number of Company-owned or franchised restaurants. The Board retains
discretion to award bonuses in excess of the pre-determined maximum if growth or
performance is exceptional and results from the efforts of the officer or
employee. Certain of the Company's other officers received discretionary cash
bonuses based upon a review of performance by his or her supervisor or, in the
case of executive officers, the Committee.

          Incentive Plan Awards.  In late 1995, the Compensation Committee and
Board of Directors established a new stock option program (the "1996 Program")
designed to replace the cash bonus program previously used with the award of
options for the majority of the Company's executive officers.  Under the 1996
Program, options (ranging from 30,000 to 75,000 shares) were awarded to
executive officers under the Incentive Plan during the 1996 fiscal year.  Other
officers and management personnel were awarded options with the number of
options determined by dividing the closing price of the Common Stock on the
award date into the officer's annual salary, multiplied from one and one-half to
up to five times.  The options vest in five annual

                                      -10-

<PAGE>
 
installments with respect to 10%, 10%, 20%, 25% and 35% of the option amount.
The Company believes that these grants will garner the commitment and service of
key management personnel by allowing these employees to share substantially in
the appreciation and value of the Company's Common Stock.  All other staff
employees who had been employed by the Company at least one year were also
awarded stock options at fair market value with the number of options based on
lower multiples of salary. 

          The Committee believes that stock options and other equity-based
incentives are a valuable tool in encouraging executive officers and other
employees to align their interests with the interests of the stockholders and to
manage the Company for the long-term.  Non-qualified options to purchase 900,128
shares of the Company's Common stock were granted to all executive officers
(including the Company's Chief Executive Officer) in 1996, with an exercise
price equal to the fair market value of the underlying Common Stock on the date
of grant.

          Compensation of Chief Executive Officer.  Consistent with the
compensation policies and components described above, the Compensation Committee
determined the salary, bonus and stock options received by John H. Schnatter,
Founder, Chairman and Chief Executive Officer of the Company, for services
rendered in 1996.  Mr. Schnatter received a base salary of $99,000 for 1996.
Mr. Schnatter also received non-qualified options to purchase 85,278 shares of
the Company's Common Stock pursuant to the 1996 Program described above.  He did
not receive a cash bonus during 1996.

          OBRA Deductibility Limitation.  The Omnibus Budget Reconciliation Act
of 1993 limits the deduction by public companies of compensation of certain
executive officers to $1 million per year, per executive officer, unless certain
criteria are met.  The Company believes that, upon adoption of certain
amendments to the Plan by the stockholders at the Annual Meeting and the
establishment by the Board of a subcommittee of "outside" directors to
administer the Plan, it will have taken the necessary steps to qualify the stock
option and performance unit components of the Incentive Plan for tax
deductibility.

                                                          COMPENSATION COMMITTEE

                                                                    Wayne Gaunce
                                                                Jack A. Laughery
                                                              Richard F. Sherman

                                      -11-


<PAGE>
 
          COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

          Immediately prior to its initial public offering of common stock in
June 1993, the Company's Board of Directors adopted a policy requiring that all
future transactions with affiliates be on terms comparable to those that the
Company could obtain from unaffiliated third parties.  In addition, the policy
requires that all such transactions be approved by a majority of the members of
the Board who are not officers or employees of the Company and who do not have
an interest in the transaction.

          All of the current members of the Compensation Committee, Messrs.
Gaunce, Laughery and Sherman, are franchisees of the Company.  In addition, Mr.
Sherman provides consulting services to the Company pursuant to a consulting
agreement, as hereinafter described.  Set forth below is a description of
transactions during the Company's last fiscal year involving these directors, as
well as other directors and executive officers of the Company.

Franchise and Development Arrangements

          Prior to the Company's initial public offering of Common Stock in June
1993, certain executive officers and directors of the Company acquired equity
interests in entities that were franchisees of the Company and that had rights
to develop Papa John's restaurants.  Certain of the entities acquired
development rights at reduced development fees and also pay a reduced franchise
fee when each restaurant is opened. However, such entities pay royalties at the
same rate as other franchisees.  The Company has determined that additional
franchise and development agreements may be entered into with non-employee
directors and executive officers of the Company and entities in which they have
an equity interest on terms no more favorable than with independent third
parties.

          Set forth below is a description of franchise and development
arrangements between the Company and entities in which the Company's executive
officers and directors, as well as their immediate family members, have an
equity interest, and the amount of franchise fees, development fees and
royalties earned by or paid to the Company from such entities during the last
fiscal year:


<TABLE>
<CAPTION>
 
Name and Percentage Owned            Franchise Entity -- Amounts Earned/Development Rights
- -------------------------            -----------------------------------------------------
<S>                                  <C>
John H. Schnatter (76%)              Joe K Corporation -- Operates one restaurant in Louisville,
Annette Schnatter (24%)              Kentucky and two restaurants in Fort Collins and Greeley,
                                     Colorado.  Franchise and development fees earned by the
                                     Company in 1996 were $40,000.  Purchased area development
                                     rights in 1996 for four restaurants in Colorado for $20,000.
                                     Paid royalties of $52,652 in 1996.  John and Annette Schnatter
                                     are husband and wife.
 
John H. Schnatter (12.5%)            Ohio Pizza Delivery Co. -- Operates eight restaurants in Ohio.
Charles W. Schnatter (5.0%)          Franchise and development fees earned by the Company in 1996
                                     were $18,500.  Paid royalties of $308,148 in 1996.
 
John H. Schnatter (31.3%)            Norcar, Inc. -- Operates 16 restaurants in North Carolina.
Charles W. Schnatter (31.3%)         Franchise and development fees earned by the Company in 1996
Richard J. Emmett (6%)               were $106,050.  Purchased area development rights in 1996 for
                                     12 restaurants in North Carolina for $60,000.  Paid royalties of
                                     $327,853 in 1996.
</TABLE>


                                      -12-

<PAGE>
 

<TABLE>
<CAPTION>
Name and Percentage Owned            Franchise Entity -- Amounts Earned/Development Rights
- -------------------------            -----------------------------------------------------
<S>                                  <C>
Richard F. Sherman (79.75%)          Sherfiz, Inc. and Sherfiz II, Inc. -- Operates two restaurants in
John H. Schnatter (8.25%)            Ohio and one in West Virginia.  Paid royalties of $85,465 in
                                     1996.
 
Richard F. Sherman (79%)             P.J. Cambridge, Inc. -- Operates one restaurant in Ohio and two
John H. Schnatter (8.25%)            in West Virginia.  Franchise and development fees earned by the
                                     Company in 1996 were $20,000.  Paid royalties of $64,606 in
                                     1996.
 
Blaine E. Hurst (76.92%)             Mountain Pizza Group, L.L.C. -- Operates four restaurants in
                                     Colorado.  Purchased area development rights for 10 restaurants
                                     in Colorado in 1996 for $50,000.  Franchise and development
                                     fees earned by the Company in 1996 were $80,000.  Paid
                                     royalties of $22,419 in 1996.

Wade S. and Elizabeth Oney (100%)    Bam-Bam Pizza, Inc. -- Operates four restaurants in Florida.
                                     Franchise and development fees earned by the Company in 1996
                                     were $15,000.  Paid royalties of $94,451 in 1996.

Wade S. Oney (100%)                  L-N-W Pizza, Inc. -- Operates 12 restaurants in Florida.  Paid
                                     royalties of $346,644 in 1996.

Wade S. Oney (25%)                   Brown's Pizza, Inc. -- Operates one restaurant in Florida.  Paid
                                     royalties of $25,414 in 1996.

Richard J. Emmett (51%)              Williamsburg Pizza Group, Inc. -- Operates six restaurants in
                                     Virginia.  Paid royalties of $133,094 in 1996.

Richard F. Sherman (18.5%)           PJ Louisiana, Inc. (f/k/a Easy Cheese, L.L.C.) -- Operates four
                                     restaurants in Louisiana.  Franchise fees earned by the Company
                                     in 1996 were $48,500.  Paid royalties of $87,441 in 1996.

Richard F. Sherman (12.4%)           PJ America, Inc. ("PJ America") -- Formerly, among others,
Jack A. Laughery (6.5%)              Textra Cheese Corp. (of which Mr. Sherman was a 20% owner), Extra 
                                     Cheese, Inc. (of which Mr. Sherman was a 17.2% owner) and PJVA,
                                     Inc. (of which Mr. Sherman was a 26% owner and Mr. Laughery was a 
                                     26% owner). These entities and two others were combined to form 
                                     PJ America in connection with PJ America's initial public
                                     offering of common stock effective October 25, 1996. PJ America 
                                     operates 46 restaurants in Virginia, Alabama and Texas. Franchise 
                                     and development fees earned by the Company in 1996 were
                                     $111,000. Paid royalties of $1,210,815 in 1996.
 
Richard F. Sherman (26%)             P.J.N.C., Inc. -- Operates six restaurants in North Carolina.
Jack A. Laughery (26%)               Franchise and development fees earned by the Company in 1996
                                     were $18,500.  Paid royalties of $93,513 in 1996.
 
Richard F. Sherman (20.74%)          PJ Utah, L.L.C. -- Operates three restaurants in Utah.
Jack A. Laughery (10.9%)             Purchased area development rights in 1996 for 30 restaurants in
                                     Utah for $150,000.  Franchise and development fees earned by
                                     the Company in 1996 were $20,000.  Paid royalties of $177 in
                                     1996.
</TABLE>


                                      -13-

<PAGE>
 

<TABLE>
<CAPTION>
Name and Percentage Owned            Franchise Entity -- Amounts Earned/Development Rights
- -------------------------            -----------------------------------------------------
<S>                                  <C>
Richard F. Sherman (20.8%)           PJIOWA, L.C. -- Operates six restaurants in Iowa and one
Jack A. Laughery (20.8%)             restaurant in Illinois.  Franchise and development fees earned by
                                     the Company in 1996 were $129,500.  Paid royalties of $48,005
                                     in 1996.
 
Jack A. Laughery (30.4%)             Houston Pizza Venture, LLC  -- Operates 25 restaurants in
                                     Texas.  Franchise and development fees earned by the Company
                                     in 1996 were $166,500.  Paid royalties of $400,299 in 1996.

Michael W. Pierce (42.5%)            Missouri Pizza Group, LLC -- Operates two restaurants in
                                     Missouri.  Franchise and development fees earned by the
                                     Company in 1996 were $40,000.  Paid royalties of $5,352 in
                                     1996.

Michael W. Pierce (37.5%)            Arkansas Pizza Group, Inc. -- Operates 11 restaurants in
                                     Arkansas.  Paid royalties of $243,996 in 1996.

Wayne Gaunce (25%)                   H & H Pizza, Inc., ILMO, Inc., P & G Pizza, Incorporated and
Patrick Gaunce (35%)                 OWG, Inc. -- These entities operated 30 restaurants during 1996
                                     in Kentucky, Tennessee, Illinois, Mississippi, Missouri and
                                     Alabama.  Franchise fees earned by the Company from these
                                     entities in 1996 were $30,731.  Paid royalties aggregating
                                     $818,107 in 1996.  Patrick Gaunce is the son of Wayne Gaunce.
 
Wayne Gaunce (12.67%)                Texas P.B., Inc. -- Operates two restaurants in Texas.
Patrick Gaunce (17.5%)               Purchased area development rights in 1996 for one restaurant in
                                     Austin, Texas for $5,000.  Franchise fees earned by the
                                     Company in 1996 were $18,500.  Paid royalties of $30,995 in
                                     1996.
 
Patrick Gaunce (100%)                SPG, Inc. -- Operates two restaurants in Bowling Green,
                                     Kentucky.  Paid royalties of $76,125 in 1996.

Patrick Gaunce (30%)                 Michigan Restaurant Group, Inc. -- Operates three restaurants in
                                     Michigan.  Franchise and development fees earned by the
                                     Company in 1996 were $36,424.  Paid royalties of $37,000 in
                                     1996.
</TABLE>


PJ America, Inc. Stock Warrant

          PJ America, Papa John's largest franchisee, completed an initial
public offering of its common stock ("IPO") effective October 25, 1996. In
connection with the IPO, PJ America issued a warrant to purchase 225,000 shares
of its common stock to the Company. The warrant is exercisable in whole or in
part at any time within five years from the closing date of the IPO, and the
purchase price of each share of PJ America common stock pursuant to the warrant
is $11.25 per share (90% of the IPO price of $12.50 per share). The Company is
restricted from selling any PJ America common stock obtained by exercising the
warrant for a period of 180 days from the closing date of the IPO. The warrant
was issued by PJ America to the Company in consideration for the guarantee by
the Company of rights to enter into development agreements for certain specified
territories and the waiver by the Company of certain market transfer fees. The
Company's agreement with PJ America anticipates that PJ America will pay
standard development and franchise fees in connection with opening restaurants
in the specified territories. In addition to his ownership interest as set out
above, Mr. Sherman is Chairman of the Board of PJ America. Charles Schnatter is
also a director of PJ America.

                                      -14-

<PAGE>
 
Franchisee Loan Program

          The Company has established a program under which selected franchisees
may borrow funds for use in the construction and development of their
restaurants from Capital Delivery, Ltd., a wholly-owned subsidiary of the
Company.  Such loans bear interest at fixed or floating rates (ranging from 5.5%
to 9.25% at December 29, 1996), and are generally secured by the fixtures,
equipment, signage and, where applicable, land of each restaurant, the ownership
interests in the franchisee and, in certain circumstances, guarantees of the
franchisee owners.  Under the terms of the applicable loan agreement, interest
only is payable over the term of the loan, generally 12 to 24 months.
Thereafter, if the loan is not in default, the franchisee may convert the loan
to a term loan with principal and interest payable monthly, amortized over a
four- to six-year term.

          Set forth below is a description of franchise loan transactions
between Capital Delivery, Ltd. and entities in which the Company's executive
officers and directors, as well as their immediate family members, have an
equity interest, the largest aggregate amount of indebtedness outstanding since
the beginning of the Company's last fiscal year, the amount outstanding as of
February 23, 1997, and the rate of interest paid thereon as of February 23,
1997.


<TABLE>
<CAPTION>
                                                             Largest Aggregate    Principal Amount   Interest
         Name and                                           Amount Outstanding     Outstanding at      Rate
     Percentage Owned                 Franchisee           Since January 1, 1996  February 23, 1997     (%)
     ----------------                 ----------           ---------------------  -----------------  --------
<S>                            <C>                         <C>                    <C>                <C>
 
Michael W. Pierce (45%)        Missouri Pizza Group, Inc.          $295,500            $295,500        9.25%
 
Blaine E. Hurst (76.92%)       Mountain Pizza Group, Inc.           810,000             810,000        9.25
 
Wade S. Oney and               Bam-Bam Pizza, Inc.                  500,000             430,556         8.0
Elizabeth Oney (100%)
 
Wade S. Oney (100%)            L-N-W Pizza, Inc.                     53,348              53,348         6.0
                                                                    411,298             411,298         8.0
 
Richard F. Sherman (20.74%)    PJ Utah, L.L.C.                      500,000             500,000         7.5
Jack A. Laughery (10.99%)
</TABLE>


Disposition

          In December 1996, the Company sold its 10% ownership interest in L-N-W
Pizza, Inc. ("L-N-W"), a franchisee that operates 12 restaurants in Florida. 
L-N-W is now wholly-owned by Wade S. Oney. The Company sold its interest to L-N-
W for total consideration of $411,298, which represented a gross value of
approximately $400,000 per restaurant. L-N-W financed the purchase price with a
loan from Capital Delivery, Ltd. The consideration paid to the Company was
determined to be fair to the Company and its stockholders by the members of the
Board of Directors who are not employees of the company and not affiliated with
L-N-W. The factors considered in determining the sales price included the sales
level, financial condition, results of operations and future prospects of the
restaurants operated by L-N-W.

Consulting Agreement

          The Company and Mr. Sherman are parties to a Consulting Agreement
dated March 29, 1991, as amended (the "Consulting Agreement"), pursuant to which
the Company pays Mr. Sherman a monthly consulting fee of

                                      -15-

<PAGE>
 
$5,000 and provides him with group health insurance.  The total amount paid to
Mr. Sherman in 1996 under the Consulting Agreement was $60,000, and the value of
group health benefits provided to Mr. Sherman in 1996 was $3,300.  Mr. Sherman
is also entitled to compensation at a rate of $157 per hour for each hour of
consulting service provided in excess of 30 hours per month.  Under the
Consulting Agreement, Mr. Sherman was awarded an option on April 1, 1991, to
purchase 617,873 shares of Common Stock at an exercise price of $0.05 per share.
The option vested 25% immediately, with the remainder becoming exercisable in
three equal annual installments on the anniversary date of the grant.  At March
26, 1997, there were _______ shares remaining and available for exercise under
the option, which must be exercised by Mr. Sherman in full by April 1, 1997.
After termination of the Consulting Agreement, Mr. Sherman has agreed not to
compete with the Company in any capacity for a period of 12 months, and in any
business that offers pizza on a delivery basis anywhere in the United States for
a period of two years.

Other Transactions

          During 1996, the Company paid $500,000 to Hampton Airways, Inc.
("Hampton") and $15,000 to Hemisphere Airways, Inc. ("Hemisphere") for charter
aircraft services. Hampton's sole shareholder is John Schnatter, the Company's
Founder and Chief Executive Officer. Hemisphere's sole shareholder is Charles
Schnatter, the Company's Senior Vice President, General Counsel and Secretary.
The rates charged to the Company by Hampton and Hemisphere were at or below
rates which could have been obtained from an independent third party for a
similar aircraft.

                                      -16-


<PAGE>


- --------------------------------------------------------------------------------

               Comparison of Five-Year Cumulative Total Returns
                            Performance Graph 
                        Papa John's International, Inc.

Prepared by the Center for Research in Security Prices
Produced on 02/27/97 including data to 12/27/96



<TABLE>
<CAPTION>
                  Date      Company Index     Market Index      Peer Index
               <S>         <C>               <C>               <C>
                12/27/91                         81.763           70.741
                01/29/92                         89.163           79.246
                02/28/92                         91.706           87.375
                03/27/92                         87.584           88.385
                04/29/92                         82.350           77.234
                05/29/92                         84.716           78.016
                06/29/92                         80.698           74.608
                07/29/92                         83.811           79.953
                08/28/92                         81.775           81.081
                09/29/92                         83.932           88.158
                10/29/92                         88.208           91.667
                11/27/92                         94.634          103.242
                12/29/92                         97.459          100.026
                01/29/93                        101.402          102.326
                02/26/93                         97.620           96.062
                03/29/93                         98.985           97.375
                04/29/93                         95.702           94.454
                05/28/93                        101.902          106.854
                06/08/93        100.000         100.000          100.000
                06/29/93        114.286         101.966           96.003
                07/29/93        118.571         102.874           94.134
                08/27/93        132.857         106.412           95.776
                09/29/93        148.571         111.021          102.396
                10/29/93        142.857         113.497          101.914
                11/29/93        135.714         109.653           98.306
                12/23/93        155.714         110.356          103.193
                01/28/94        160.000         116.014          104.897
                02/28/94        155.714         115.527          104.518
                03/29/94        165.714         110.134          100.758
                04/29/94        147.143         107.014           96.537
                05/27/94        145.714         106.966           90.561
                06/29/94        145.714         103.040           84.701
                07/29/94        140.000         105.472           86.335
</TABLE>


- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>




                Date       Company Index    Market Index    Peer Index
             <S>          <C>               <C>             <C>
                08/29/94        155.714         111.786           91.679
                09/29/94        154.286         111.189           88.560
                10/28/94        178.571         113.876           87.546
                11/29/94        165.714         110.540           77.519
                12/23/94        155.714         109.163           75.502
                01/27/95        180.357         111.803           79.030
                02/28/95        177.143         117.137           82.136
                03/29/95        208.571         120.907           82.007
                04/28/95        197.857         124.405           83.623
                05/26/95        202.857         128.726           89.680
                06/29/95        198.571         136.930           90.216
                07/28/95        244.286         148.696           96.455
                08/29/95        222.500         148.589           96.657
                09/29/95        257.143         154.571           96.356
                10/27/95        212.143         152.095           91.890
                11/29/95        245.714         157.048           96.087
                12/29/95        235.357         156.456           92.319
                01/29/96        241.428         154.644           87.952
                02/29/96        294.286         163.222           93.929
                03/29/96        382.500         163.765          102.274
                04/29/96        414.643         176.993          106.469
                05/29/96        424.285         182.748          103.976
                06/28/96        417.857         177.133          106.444
                07/29/96        362.143         159.145           90.665
                08/29/96        387.857         170.898           99.144
                09/27/96        435.000         183.992           97.377
                10/29/96        410.357         178.561           88.080
                11/29/96        414.643         192.650           94.269
                12/27/96        418.660         192.690           89.732

</TABLE>



<TABLE>
<CAPTION>

                                    Legend
Symbol    CRSP Total Returns Index for:                            06/08/93     12/23/93    12/23/94    12/29/95      12/27/96
- ------    -----------------------------                            --------     --------    --------    --------      --------
<S>       <C>                                                      <C>           <C>        <C>         <C>           <C>

======    "  Papa John's International, Inc.                        100.0        155.7      155.7        235.4         418.7
 ...___    *  Nasdaq Stock Market (Us Companies)                     100.0        110.4      109.2        156.5         192.7
- - - -     .  NASDAQ Stocks (SIC 5800-5899 US Companies)             100.0        103.2       75.5         92.3          89.7
             Eating and drinking places
</TABLE>

 
Notes:
     A.  The lines represent annual index levels derived from compounded daily
         returns that include all dividends.
     B.  The indexes are reweighted daily, using the market capitalization on
         the previous trading day.
     C.  If the annual interval, based on the fiscal year-end, is not a trading
         day, the preceding trading day is used.
     D.  The index level for all series was set to $100.0 on 06/08/93.


                                      -17-

<PAGE>
 
            SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

          Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than 10% of
the Company's Common Stock, to file initial stock ownership reports and reports
of changes in ownership with the Securities and Exchange Commission and The
Nasdaq Stock Market. Based on a review of these reports and written
representations from the reporting persons, the Company believes that all
applicable Section 16(a) reporting requirements were complied with for all
Common Stock transactions in 1996.

               2. PROPOSAL TO ADOPT AMENDMENTS TO THE COMPANY'S
                      1993 STOCK OWNERSHIP INCENTIVE PLAN

          The Board of Directors has adopted, and recommends that stockholders
approve, amendments to the Company's 1993 Stock Ownership Incentive Plan (the
"Plan"). These amendments are being made to (i) increase the number of shares of
Common Stock reserved for issuance under the Plan from 3,487,500 shares to
__________ shares, and (ii) address certain tax deductibility limits imposed by
the Omnibus Budget Reconciliation Act of 1993 ("OBRA") and to preserve for the
Company the tax deduction for certain compensation paid thereunder. The primary
features of the Plan are set forth below. The proposed amendments are set forth
in Exhibit A to this Proxy Statement. The Company intends to file a registration
statement on Form S-8 under the Securities Act of 1933, as amended, with respect
to the additional shares issuable under options and awards granted under the
Plan.

Description of the Plan

          The Plan was approved by the Company's Board of Directors and
stockholders in 1993. The Plan permits the award to the Company's employees of
performance units (which may be paid in cash or shares of Common Stock),
restricted stock and stock options. The Plan currently reserves for issuance an
aggregate of 3,487,500 shares of Common Stock, not more than 225,000 shares of
which may be issued in the form of restricted shares. The Plan is intended to
advance the interests of the Company and its stockholders by encouraging
employees, who are largely responsible for the long-term success and development
of the Company, to acquire and retain an ownership interest in the Company. The
Company believes that equity incentives represented by stock options enhance the
Company's ability to attract and retain needed personnel. The amendment to the
Plan increases the number of shares of Common Stock reserved for option grants
and restricted stock awards by ____________ shares.

          Employees of the Company are eligible to receive awards under the Plan
when designated by the committee responsible for administering the Plan (the
"Committee"). Following the Annual Meeting, it is anticipated that the Committee
will be composed of "outside directors" within the meaning of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code"). The Committee may
designate eligible employees as it deems appropriate. At December 29, 1996, the
Company had approximately 9,544 employees.

          Restricted stock consists of shares of Common Stock which are sold or
transferred by the Company to an employee at a price which may be below their
fair market value or for no payment, but subject to restrictions on their sale
or other transfer by the employee.

          Performance units are rights to receive a payment from the Company
which may be payable in cash or shares of Common Stock or both, provided certain
levels of performance standards are met. The Plan provides that the Committee
will determine the performance goals for the calendar year based on business

                                     -18-

<PAGE>
 
criteria which may include net income, earnings per share or return on equity
for the Company, or net income or return on equity for a division, region,
subsidiary or other unit of the Company (the "Performance Goals"). The Committee
may establish more than one level of performance criteria such that a portion of
the maximum number of performance units is allocated if a level (other than the
highest level) is attained. The Committee determines the number of performance
units to be granted and any restrictions on sale or transfer of the performance
unit. If the Plan amendments to be voted on by stockholders at the Annual
Meeting are approved, the Committee will be required to establish Performance
Goals applicable to a fiscal year within 90 days of the commencement of that
year and the maximum number of performance units which may be allocated to a
participant in a calendar year will be limited to 150,000 units. Moreover, the
Committee will be required to certify that the Performance Goals have been
satisfied prior to the payment of any units. To date, no performance units have
been awarded under the Plan.

          The Committee may also grant stock options under the Plan. The
Committee determines the number and purchase price of the shares of Common Stock
subject to an option, the term of each option and the time or times during its
term when the option becomes exercisable. The term of a stock option may not
exceed ten years from the date of grant and generally may not be exercised
earlier than six months after the date of grant. No stock option will be issued
with an exercise price below the fair market value of a share of Common Stock on
the date of grant. On the Record Date, the closing price per share of the
Company's Common Stock as reported on the Nasdaq Stock Market was $__________.

          Stock options granted under the Plan may be either incentive stock
options ("ISOs") which qualify under Section 422 of the Code, or stock options
that do not so qualify ("NQSOs"). ISOs granted to any employee holding more than
10% of the combined voting power of all classes of stock of the Company must be
granted with an exercise price of not less than 110% of fair market value. To
date, no ISOs have been awarded under the Plan. Optionees may exercise options
under the Plan by paying cash, tendering shares of Common Stock or through a
cashless exercise procedure. Upon a Change in Control (as defined in the Plan)
of the Company, all outstanding options will become fully vested and immediately
exercisable.

          The Plan currently does not limit the number of options which may be
awarded to a participant in any calendar year. If the Plan amendments to be
voted on by stockholders at the Annual Meeting are approved, the maximum number
of stock options that may be awarded to any participant in any calendar year
will be limited to options for no more than 250,000 shares.

          The number of shares of Common Stock available for issuance under the
Plan will be adjusted in the event of a merger, consolidation, reorganization,
stock dividend, stock split or other change in corporate structure or
capitalization affecting the Common Stock. Shares of Common Stock subject to,
but not delivered under, an award terminating or expiring for any reason
generally will be available for the grant of future awards under the Plan.

          The Plan will terminate on the earliest to occur of (i) the date when
all shares of Common Stock available under the Plan have been acquired through
the exercise of options, lapse of restrictions or payment of benefits under the
Plan, (ii) April 15, 2003, or (iii) such earlier date as the Board of Directors
may determine. The Board may amend, modify or terminate the Plan, but not may
not, without the prior approval of stockholders, make any amendment which would
materially increase the benefits accruing to participants under the Plan,
materially increase the total number of shares of Common Stock which may be
issued under the Plan or materially modify the class of employees eligible to
participate in the Plan, if such approval is required by the Code, Section 16 of
the Exchange Act and the rules promulgated thereunder, any national securities
exchange or system on which the Common Stock is then listed or reported or a
regulatory body

                                     -19-

<PAGE>
 
having jurisdiction over the Company. No amendments of the Plan will impair the
rights of any participant without such participant's consent.

          The Federal income tax consequences of awards under the Plan, as
previously disclosed to stockholders, will not be impacted by the proposed
amendment. In general, the granting of an NQSO does not produce taxable income
to the optionee or a tax deduction to the Company. Taxable ordinary income will
generally be recognized by the optionee at the time of exercise in an amount
equal to the excess of the fair market value of the shares purchased at the time
of such exercise over the aggregate option price. The Company is entitled to a
corresponding Federal income tax deduction. In the case of an ISO, an optionee
will not recognize any taxable income at the time of grant and the Company will
not be entitled to a Federal income tax deduction. No ordinary income will be
recognized by the holder of an ISO at the time of exercise. If the optionee
holds the shares acquired upon exercise of the ISO for the greater of two years
after the date the option was granted or one year after the acquisition of such
shares, the difference between the aggregate option price and the amount
realized upon disposition of the shares will constitute a long-term capital gain
or loss, as the case may be, and the Company will not be entitled to a Federal
income tax deduction.

OBRA Deductibility Limits

          Under OBRA, publicly-held companies may not deduct compensation paid
to certain executive officers to the extent that such compensation exceeds $1
million in any one year for each such officer. The Code provides an exception
for certain types of compensation which are: (1) subject to the attainment of an
objective performance goal, (2) made under a plan administered by outside
directors, and (3) made pursuant to a plan approved by stockholders which
includes certain parameters for performance-based compensation. The purpose of
the proposed amendments is to qualify certain awards under the Plan for the
exception in the Code.

          In order to satisfy the requirements of OBRA with respect to
performance units and stock options, the Board has adopted and recommends that
the stockholders approve amendments to (i) require the meeting of certain
performance goals before performance units are issued, (ii) specify that no more
than 150,000 performance units be allocated to any single employee in any
calendar year, (iii) specify that options for no more than 250,000 shares may be
issued to any one employee in any calendar year, and (iv) limit the ability of
the Committee to exercise discretion under the Plan if the ability to exercise
such discretion or the exercise of such discretion itself would cause
compensation to fail to qualify as performance-based compensation. Approval of
the amendments by stockholders is intended to qualify performance units and
stock options granted in accordance with the Plan as exempt compensation under
OBRA, thus preserving the Company's tax deduction if and when performance units
are given to an employee. Restricted stock which may be granted under the Plan
is not, and assuming the proposed amendments are adopted will not be, exempt
from the OBRA deduction limitation.

          The affirmative vote of the holders of a majority of the shares of
Common Stock present, in person or by proxy, at the Annual Meeting is required
for the approval of the above-described amendments to the Plan. THE BOARD OF
DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT TO INCREASE THE
NUMBER OF SHARES AVAILABLE FOR ISSUANCE UNDER THE PLAN AND "FOR" AMENDMENTS TO
ADDRESS CERTAIN TAX DEDUCTIBILITY LIMITS IMPOSED BY OBRA. Shares of Common Stock
covered by proxies executed and received in the accompanying form will be voted
in favor of the amendments, unless otherwise specified on the proxy.

                                     -20-

<PAGE>
 
                      3.  AMENDMENT TO ARTICLE IV OF THE

                          CERTIFICATE OF INCORPORATION

          Article IV of the Company's Certificate of Incorporation presently
authorizes the issuance of 35,000,000 shares of Common Stock having $.01 par
value per share, and 5,000,000 shares of Preferred Stock having $.01 par value
per share. Article IV presently defines the relative rights, preferences and
limitations of the two classes of the Company's stock and authorizes the Board
of Directors to create series of the class of preferred stock and to fix the
relative rights of each series, including dividend rates, conversion prices,
voting prices, redemption prices and similar matters.

          At the Annual Meeting, the shareholders will be asked to approve the
Board of Directors' proposal that the Certificate of Incorporation be amended to
increase the number of authorized shares of Common Stock to 50,000,000.

Outstanding Shares; Reasons for and Effect of the Proposed Amendment

          As of the Record Date, the Company had __________ shares of Common
Stock issued and outstanding. The proposed amendment to the Certificate of
Incorporation will make available additional shares of Common Stock for issuance
by the Board of Directors from time to time for Company purposes, without
further shareholder approval, including stock splits, stock dividends,
acquisitions, future financing and employee benefit plans, including the Plan.

          The additional shares of Common Stock for which authorization is
sought would be identical to the shares of Common Stock of the Company now
authorized. The Board of Directors of the Company has no present intent to issue
and no specific plans as to any specific use or uses of additional shares of
Common Stock, if authorized.

          Although the Board of Directors is not aware of any proposed attempt
to acquire control of the Company (by, for example, a tender offer, merger or
proxy contest), the proposed amendment would create additional shares of Common
Stock that could be utilized in an effort to discourage any such attempt not
approved by the Board of Directors. The issuance of such shares could have the
effect of making the Company less attractive or making the acquisition of
control of the Company more expensive or impractical. Defensive uses of unissued
shares by incumbent managements in other instances have included, among others,
sales of shares to persons expected to be supportive of management. Any such
transactions in which the shares are issued and their effect on an attempted
acquisition of control could be unfavorable to the interests of shareholders.
The Board of Directors of the Company does not know of any person interested in
acquiring control of the Company and does not have any plans to use the
additional shares of Common Stock as a takeover defensive measure.

Vote Required

          The adoption of this proposal will require the affirmative vote of the
holders of a majority of the outstanding shares of Common Stock of the Company
voted on the proposal, assuming a quorum is present. THE BOARD OF DIRECTORS
UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THIS PROPOSAL.

                                     -21-

<PAGE>
 
           4.  RATIFICATION OF THE SELECTION OF INDEPENDENT AUDITORS

          The Board of Directors will request stockholders to ratify its
selection of Ernst & Young LLP, independent auditors, to examine the
consolidated financial statements of the Company for the fiscal year ending
December 28, 1997. Ernst & Young LLP has audited the Company's financial
statements since 1991. Representatives of Ernst & Young LLP will be present at
the Annual Meeting to make a statement if they desire to do so and respond to
questions by stockholders. The affirmative vote of a majority of the shares
represented at the meeting is required for the ratification of the Board's
selection of Ernst & Young LLP as the Company's independent auditors. THE BOARD
OF DIRECTORS RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE SELECTION OF ERNST
& YOUNG LLP AS INDEPENDENT AUDITORS OF THE COMPANY.

                                OTHER BUSINESS

          The Board of Directors is not aware of any other matters to be
presented at the Annual Meeting other than those set forth in the Notice of
Annual Meeting and routine matters incident to the conduct of the meeting. If
any other matters should properly come before the Annual Meeting or any
adjournment or postponement thereof, the persons named in the proxy, or their
substitutes, intend to vote on such matters in accordance with their best
judgment.


                             STOCKHOLDER PROPOSALS

          Any stockholder proposal intended to be presented at next year's
Annual Meeting of Stockholders must be received by the Company by December __,
1997, to be considered for inclusion in the Company's proxy materials for such
meeting. In addition, a stockholder who wishes to introduce a proposal at an
annual meeting of stockholders, regardless of whether the stockholder wants the
proposal included in the Company's proxy materials, must comply with certain
requirements set forth in the Company's Certificate of Incorporation. A copy of
the Certificate of Incorporation may be obtained by written request to the
General Counsel of the Company at its principal executive offices at P.O. Box
99900, Louisville, Kentucky 40269-9990.


                                 ANNUAL REPORT

          The Company's Annual Report to Stockholders for the fiscal year ending
December 29, 1996, accompanies this Proxy Statement.


                                 By Order of the Board of Directors



                                 Charles W. Schnatter
                                 Senior Vice President, Secretary
                                   and General Counsel

Louisville, Kentucky
April 10, 1997

                                     -22-

<PAGE>
 

                                   EXHIBIT A

1.  Section 3.2 of the Plan is amended by adding at the end thereof the
following:

     "Notwithstanding the foregoing, the Committee may not delegate its
     responsibilities hereunder if such delegation would jeopardize compliance
     with the "outside directors" requirement (or any other applicable
     requirement) under section 162(m) of the Code."


2.   The first sentence of Section 4.1 of the Plan is amended to read in its
entirety as follows:

     Subject to adjustment as provided in Section 4.3, the number of shares of
     Common Stock reserved for issuance under the Plan is __________.


3.   Section 6.2 of the Plan is amended by adding the following after the second
sentence of such section:

     "The maximum number of shares in respect of which Options may be granted to
     a Participant during any calendar year shall be 250,000 shares."


4.   Section 8.1 of the Plan is amended by adding at the end thereof the
following:

     "The maximum number of Performance Units which may be allocated to a
     Participant during any calendar year shall be 150,000 Units."


5.   Section 8.4 of the Plan is amended by adding at the end thereof the
following:

     "The Committee shall establish Performance Goals applicable to a particular
     fiscal year within ninety (90) days of the commencement of such fiscal
     year, provided that the outcome of the Performance Goals is substantially
     uncertain at the time of their adoption."


6.   Section 8.8 of the Plan is amended by adding the following after the first
sentence of such section:

     "The Committee shall certify that the Performance Goal(s) for awards of
     Performance Units under the Plan have been satisfied prior to the
     determination and payment of any such incentive in accordance with the
     Plan."


<PAGE>

                                  APPENDIX A

          THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
                        PAPA JOHN'S INTERNATIONAL, INC.
                                 P.O. Box 99900
                        Louisville, Kentucky  40269-9990
                    PROXY -- ANNUAL MEETING OF STOCKHOLDERS


     The undersigned, a stockholder of PAPA JOHN'S INTERNATIONAL, INC., a
Delaware corporation (the "Company"), hereby constitutes and appoints CHARLES W.
SCHNATTER and CHARLOTTE L. HENDRICK, and each of them, the true and lawful
attorneys and proxies with full power of substitution, for and in the name,
place and stead of the undersigned, to vote all shares of the Common Stock of
the Company which the undersigned would be entitled to vote if personally
present at the Annual Meeting of Stockholders to be held at The Hyatt Regency
Hotel, 320 West Jefferson Street, Louisville, Kentucky, on Thursday, May 22,
1997, at 11:00 A.M. (E.D.T.) and at any adjournment thereof.

     The undersigned hereby instructs said proxies or their substitutes:

     1.  ELECTION OF DIRECTORS
         NOMINEES:  O. Wayne Gaunce (Class II)
                    Jack A. Laughery (Class II)
                    Michael W. Pierce (Class II)
                    Blaine E. Hurst (Class III)
         [_]  For the above-named nominees.
         [_]  Withhold authority to vote for the above-named nominees.
     (INSTRUCTION: To withhold authority to vote for any individual nominee,
     write that nominee's name in the space provided below:)

     -------------------------------------------------------------------------

     2.   AMENDMENT TO THE COMPANY'S 1993 STOCK OWNERSHIP INCENTIVE PLAN:  To
          increase the number of shares available for issuance under the plan.
              [_]  FOR          [_]  AGAINST        [_]  ABSTAIN
 

     3.   AMENDMENTS TO THE COMPANY'S 1993 STOCK OWNERSHIP INCENTIVE PLAN:  To
          address certain tax deductibility limits imposed by the Omnibus
          Budget Reconciliation Act of 1993 and to preserve for the Company
          the tax deduction for certain compensation paid thereunder.
              [_]  FOR          [_]  AGAINST        [_]  ABSTAIN
 
 

<PAGE>

     4.   AMENDMENT TO ARTICLE IV OF THE CERTIFICATE OF INCORPORATION:  To
          increase the number of authorized shares of Common Stock to 50,000,000
               [_]  FOR           [_]  AGAINST        [_]  ABSTAIN
 
     5.   RATIFICATION OF THE SELECTION OF INDEPENDENT AUDITORS:  To ratify the 
          selection of Ernst & Young LLP as the Company's independent auditors 
          for the 1997 fiscal year.
               [_]  FOR           [_]  AGAINST        [_]  ABSTAIN

     6.   DISCRETIONARY AUTHORITY: To vote with discretionary authority with
          respect to all other matters which may properly come before the
          Meeting.

     This proxy, when properly executed, will be voted in accordance with any
directions hereinbefore given. Unless otherwise specified, this proxy will be
voted FOR the nominees named in Item 1 and FOR the Proposals set forth in Items
2, 3, 4 and 5. MANAGEMENT RECOMMENDS A VOTE FOR THE ABOVE MATTERS.

     The undersigned hereby revokes all proxies heretofore given and ratifies
and confirms all that the proxies appointed hereby, or either of them, or their
substitutes, may lawfully do or cause to be done by virtue hereof. The
undersigned hereby acknowledges receipt of a copy of the Notice of Annual
Meeting and Proxy Statement, both dated April 10, 1997, and a copy of the
Company's Annual Report for the fiscal year ended December 29, 1996.

                                 Please sign exactly as name appears on label.
                                 If shares are held by joint tenants, all
                                 parties in the joint tenancy must sign. When
                                 signing as attorney, executor, administrator,
                                 trustee or guardian, please sign in full
                                 corporate name by president or other authorized
                                 officer. If a partnership, please sign in
                                 partnership name by authorized person.


                                 ---------------------------------------------
                                 Signature                         Date   
                              

                                 ---------------------------------------------
                                 Signature, if held jointly        Date

<PAGE>
 
                                  Appendix B

                        PAPA JOHN'S INTERNATIONAL, INC.
                      1993 STOCK OWNERSHIP INCENTIVE PLAN


ARTICLE 1.  PURPOSE

     The purpose of this 1993 Stock Ownership Incentive Plan is to advance the
interests of Papa John's International, Inc. and its subsidiaries, by
encouraging employees who will largely be responsible for the long-term success
and development of the Company to acquire and retain an ownership interest in
the Company. The Plan is also intended to provide flexibility to the Company in
attracting and retaining such employees and stimulating their efforts on behalf
of the Company.

ARTICLE 2.  DEFINITIONS AND CONSTRUCTION

     2.1  Definitions.  As used in the Plan, terms defined parenthetically
immediately after their use shall have the respective meanings provided by such
definitions, and the terms set forth below shall have the following meanings (in
either case, such meanings shall apply equally to both the singular and plural
forms of the terms defined):

     (a)  "Award" shall mean, individually or collectively, a grant under the
Plan of Options, Restricted Stock or Performance Units.

     (b)  "Board" shall mean the Board of Directors of the Company.

     (c)  "Cause" shall mean (i) the failure by a Participant to render services
to the Company, which failure amounts to gross neglect or gross insubordination,
(ii) the commission by a Participant of an act of fraud or embezzlement against
the Company, or (iii) a Participant being convicted of a felony, or failing to
contest a felony prosecution.

     (d)  A "Change in Control" shall mean (i) the acquisition by any person
after the date hereof of beneficial ownership of 50% or more of the voting power
of the Company's outstanding voting stock, (ii) three or more of the current
members of the Board ceasing to be members of the Board (unless any replacement
director is elected by a vote of either at least 75% of the remaining directors,
or of at least 75% of the shares entitled to vote on such replacement) or (iii)
approval by the stockholders of the Company of (a) a merger or consolidation of
the Company with another corporation if the stockholders of the Company
immediately before such vote will not, as a result of such merger or
consolidation, own more than 50% of the voting stock of the corporation result-
ing from such merger or consolidation, or (b) a complete liquidation of the
Company or sale of all, or substantially all, of the assets of the Company.
Notwithstanding the foregoing, a Change in Control shall not occur solely
because 50% or more of the voting stock of the Company is

<PAGE>
 
acquired by (i) a trust which is part of an employee benefit plan maintained by
the Company or its Subsidiaries or (ii) a corporation which, immediately
following such acquisition, is owned directly or indirectly by the stockholders
of the Company in the same proportion as their ownership of stock in the Company
immediately prior to such acquisition.

     (e)  "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor thereto.

     (f)  "Committee" shall mean the committee described in Section 3.1.

     (g)  "Common Stock" shall mean shares of the Company's common stock, par
value $.01 per share.

     (h)  "Company" shall mean Papa John's International, Inc., a Delaware
corporation.

     (i)  "Disability" shall mean a physical or mental infirmity which the
Committee determines impairs the Participant's ability to perform substantially
his or her duties for a period of 180 consecutive days.

     (j)  "Effective Date" shall mean April 15, 1993, the date the Plan was
adopted by the Board.

     (k)  "Employee" shall mean an individual who is a full-time employee of the
Company or a Subsidiary.

     (l)  "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.

     (m)  "Fair Market Value" of a share of Common Stock shall mean, as of any
applicable date, the closing sale price of the Common Stock on the NASDAQ
National Market System or any national or regional stock exchange on which the
Common Stock is then traded.  If no such reported sale of the Common Stock shall
have occurred on such date, Fair Market Value shall mean the closing sale price
of the Common Stock on the next preceding date on which there was a reported
sale.  If the Common Stock is not listed on the NASDAQ National Market System or
a national or regional stock exchange, the Fair Market Value of a share of
Common Stock as of a particular date shall be determined by such method as shall
be determined by the Committee.

     (n)  "ISOs" shall have the meaning given such term in Section 6.1.

     (o)  "NQSOs" shall have the meaning given such term in Section 6.1.

     (p)  "Option" shall mean an option to purchase shares of Common Stock
granted pursuant to Article 6.

                                      -2-

<PAGE>
 
     (q) "Option Agreement" shall mean an agreement evidencing the grant of an
Option as described in Section 6.2.

     (r) "Option Exercise Price" shall mean the purchase price per share of
Common Stock subject to an Option, which shall not be less than the Fair Market
Value on the date of grant.

     (s) "Participant" shall mean any Employee selected by the Committee to
receive an Award under the Plan.

     (t) "Performance Goals" shall have the meaning given such term in Section
8.4.

     (u) "Performance Period" shall have the meaning given such term in Section
8.3.

     (v) "Performance Unit" shall mean the right to receive a payment from the
Company upon the achievement of specified Performance Goals as set forth in a
Performance Unit Agreement.

     (w) "Performance Unit Agreement" shall mean an agreement evidencing a
Performance Unit Award, as described in Section 8.2.

     (x) "Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and as used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d).

     (y) "Plan" shall mean this Papa John's International, Inc. 1993 Stock
Ownership Incentive Plan as the same may be amended from time to time.

     (z) "Restriction Period" shall mean the period determined by the Committee
during which the transfer of shares of Common Stock is limited in some way or
such shares are otherwise restricted or subject to forfeiture as provided in
Article 7.

     (aa) "Restricted Stock" shall mean shares of Common Stock granted pursuant
to Article 7 as to which the restrictions have not lapsed.

     (ab) "Restricted Stock Agreement" shall mean an agreement evidencing a
Restricted Stock Award, as described in Section 7.2.

     (ac) "Retirement" shall mean retirement by a Participant in accordance with
the terms of the Company's retirement or pension plans, if any, or, if the
Company has no such plans, then retirement after reaching age 65.

                                      -3-

<PAGE>
 
     (ad) "Subsidiary" shall mean, with respect to any company, any corporation
or other Person of which a majority of its voting power, equity securities, or
equity interest is owned, directly or indirectly, by such company.

     2.2  Gender and Number.  Unless otherwise indicated by the context,
reference to the masculine gender shall include the feminine gender, the plural
shall include the singular and the singular shall include the plural.

     2.3  Severability.  In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.

ARTICLE 3.  ADMINISTRATION

     3.1  The Committee.  The Plan shall be administered by the Compensation
Committee of the Board, or by any other committee (the "Committee") appointed by
the Board consisting of two or more directors of the Company who are
"disinterested persons" within the meaning of Rule 16b-3 (or any successor
provision) promulgated under the Exchange Act.  The members of the Committee
shall be appointed from time to time by, and shall serve at the discretion of,
the Board.

     3.2  Authority of the Committee.  Subject to the provisions of the Plan,
the Committee shall have full authority to:

     (a) select Participants to whom Awards are granted;

     (b) determine the size, types and frequency of Awards granted under the
Plan;

     (c) determine the terms and conditions of Awards, including any
restrictions or conditions to the Award, which need not be identical;

     (d) cancel or modify, with the consent of the Participant, outstanding
Awards and to grant new Awards in substitution therefor;

     (e) accelerate the exercisability of, and accelerate or waive any or all
the restrictions and conditions applicable to, any Award, for any reason;

     (f) extend the duration of an Option exercise period or term of an Award;

     (g) construe and interpret the Plan and any agreement or instrument entered
into under the Plan;

     (h) establish, amend and rescind rules and regulations for the Plan's
administration; and

                                      -4-

<PAGE>
 
     (i) amend the terms and conditions of any outstanding Award to the extent
such terms and conditions are within the discretion of the Committee as provided
in the Plan.

The Committee shall have sole discretion to make all other determinations which
may be necessary or advisable for the administration of the Plan.  To the extent
permitted by law and Rule 16b-3 promulgated under the Exchange Act, the
Committee may delegate its authority as identified hereunder.

     3.3  Decisions Binding.  All determinations and decisions made by the
Committee pursuant to the provisions of the Plan, and all related orders or
resolutions of the Board, shall be final, conclusive and binding upon all
persons, including the Company, its stockholders, Employees, Participants and
their estates and beneficiaries.

     3.4  Section 16 Compliance; Bifurcation of Plan.  It is the intention of
the Company that the Plan and the administration of the Plan comply in all
respects with Section 16(b) of the Exchange Act and the rules and regulations
promulgated thereunder.  If any Plan provision, or any aspect of the
administration of the Plan, is found not to be in compliance with Section 16(b)
of the Exchange Act, the provision or administration shall be deemed null and
void, and in all events the Plan shall be construed in favor of its meeting the
requirements of Rule 16b-3 promulgated under the Exchange Act.  Notwithstanding
anything in the Plan to the contrary, the Board or the Committee, in its
discretion, may bifurcate the Plan so as to restrict, limit or condition the use
of any provision of the Plan to Participants who are subject to Section 16 of
the Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.

ARTICLE 4.  SHARES AVAILABLE UNDER THE PLAN

     4.1 Number of Shares. Subject to adjustment as provided in Section 4.3,
the number of shares of Common Stock reserved for issuance under the Plan is
3,487,500. Any Common Stock issued under the Plan may consist, in whole or in
part, of authorized and unissued shares or treasury shares. If and to the extent
an Award shall expire or terminate for any reason without having been exercised
in full (including a cancellation and regrant of an Option), or shall be
forfeited, without, in either case, the Participant having realized any of the
economic benefits of a shareholder (such as the receipt of dividends or other
distributions paid on shares of Restricted Stock), the shares (including
Restricted Stock) associated with such Awards shall again become available for
Awards under the Plan.

     4.2  Shares of Restricted Stock Available Under the Plan.  Subject to
adjustment as provided in Section , the number of shares of Common Stock which
may be the subject of Awards granted in the form of Restricted Stock is limited
to 225,000 shares.

     4.3  Adjustments in Authorized Shares and Outstanding Awards.  In the event
of any change in the corporate structure of the Company affecting the Common
Stock, including a

                                      -5-

<PAGE>

merger, reorganization, consolidation, recapitalization, reclassification,
split-up, spin-off, separation, liquidation, stock dividend, stock split,
reverse stock split, share repurchase, share combination, share exchange,
issuance of warrants or debentures, the Committee may substitute or adjust the
total number and class of shares of Common Stock or other stock or securities
which may be issued under the Plan, and the number, class and/or price of shares
subject to outstanding Awards, as it, in its discretion, determines to be
appropriate and equitable to prevent dilution or enlargement of the rights of
Participants and to preserve, without exceeding, the value of any outstanding
Awards; provided, however, that the number of shares subject to any Award shall
always be a whole number.

ARTICLE 5.  ELIGIBILITY AND PARTICIPATION

     All Employees of the Company and its Subsidiaries are eligible to receive
Awards under the Plan. In selecting Employees to receive Awards under the Plan,
as well as in determining the number of shares subject to, and the other terms
and conditions applicable to, each Award, the Committee shall take into
consideration such factors as it deems relevant in promoting the purposes of the
Plan, including the duties of the Employees, their present and potential
contribution to the success of the Company and their anticipated number of years
of active service remaining with the Company or a Subsidiary.

ARTICLE 6.  STOCK OPTIONS

     6.1  Grant of Options.  Subject to the terms and provisions of the Plan,
the Committee may grant Options to Participants at any time and from time to
time, in the form of options which are intended to qualify as incentive stock
options within the meaning of section 422 of the Code ("ISOs"), Options which
are not intended to so qualify ("NQSOs") or a combination thereof.

     6.2  Option Agreement.  Each Option shall be evidenced by an Option
Agreement that shall specify the Option Exercise Price, the duration of the
Option, the number of shares to which the Option relates and such other
provisions as the Committee may determine or which are required by the Plan.
The Option Agreement shall also specify whether the Option is intended to be an
ISO or a NQSO and shall include such provisions applicable to the particular
type of Option granted.

     6.3  Duration of Options.  Subject to the provisions of Section , each
Option shall expire at such time as is determined by the Committee at the time
of grant; provided, however, that no Option shall at the time of grant be
exercisable later than the tenth anniversary of its grant.

     6.4  Exercise of Options.  Options shall be exercisable at such times and
be subject to such restrictions and conditions as the Committee shall approve at
the time of grant, which need not be the same for each grant or for each
Participant.  Options shall be exercised by delivery to the Company of a written
notice of exercise, setting forth the number of shares with respect to

                                      -6-

<PAGE>
 
which the Option is to be exercised and accompanied by full payment of the
Option Exercise Price and all applicable withholding taxes.

     6.5  Payment of Option Exercise Price.  The Option Exercise Price for
shares of Common Stock as to which an Option is exercised shall be paid to the
Company in full at the time of exercise either (a) in cash in the form of
currency or other cash equivalent acceptable to the Company, (b) by tendering
Common Stock having a Fair Market Value (at the close of business on the date
the Company receives the notice of exercise) equal to the Option Exercise Price,
(c) any other reasonable consideration that the Committee may deem appropriate
or (d) by a combination of the forms of consideration described in (a), (b) and
(c) of this Section 6.5. The Committee may permit the cashless exercise of
Options as described in Regulation T promulgated by the Federal Reserve Board,
subject to applicable securities law restrictions, or by any other means which
the Committee determines to be consistent with the Plan's purpose and applicable
law.

     6.6  Vesting Upon Change in Control.  Upon a Change in Control, any then
outstanding Options held by Participants shall become fully vested and
immediately exercisable.

     6.7  Termination of Employment.  If the employment of a Participant is
terminated for Cause, all then outstanding Options of such Participant, whether
or not exercisable, shall terminate immediately.  If the employment of a
Participant is terminated for any reason other than for Cause, death, Disability
or Retirement, to the extent then outstanding Options of such Participant are
exercisable, such Options may be exercised by such Participant or his personal
representative at any time prior to the earlier of (a) the expiration date of
the Options or (b) the date which is 90 days after the date of such termination
of employment.  In the event of the Retirement of a Participant, to the extent
then outstanding Options of such Participant are exercisable, such Options may
be exercised by the Participant (c) in the case of NQSOs, within one year after
the date of Retirement and (d) in the case of ISOs, within 90 days after
Retirement; provided, however, that no such Options may be exercised on a date
subsequent to their expiration.  In the event of the death or Disability of a
Participant while employed by the Company or a Subsidiary, all then outstanding
Options of such Participant shall become fully vested and immediately
exercisable, and may be exercised at any time within one year after the date of
death or determination of Disability; provided however that no such Options may
be exercised on a date subsequent to their expiration.  Options may be exercised
as provided in this Section 6.7 (e) in the event of the death of a Participant,
by the person or persons to whom rights pass by will or by the laws of descent
and distribution, or if appropriate, the legal representative of the decedent's
estate and (f) in the event of the Disability of a Participant, by the
Participant, or if such Participant is incapacitated, by the Participant's legal
representative.

ARTICLE 7.  RESTRICTED STOCK

     7.1  Grant of Restricted Stock.  Subject to the terms and provisions of the
Plan, the Committee may grant shares of Restricted Stock to Participants at any
time and from time to time

                                      -7-

<PAGE>
 
and upon such terms and conditions as it may determine. The purchase price for
shares of Restricted Stock shall be determined by the Committee, but shall not
be less than the par value of the Common Stock, except in the case of treasury
shares, for which no payment need be required.

     7.2 Restricted Stock Agreement. Each Restricted Stock grant shall be
evidenced by a Restricted Stock Agreement which shall specify the Restriction
Period, the number of shares of Restricted Stock granted and such other
provisions as the Committee may determine and which are required by the 
Plan.

     7.3  Non-Transferability of Restricted Stock. Except as provided in this
Article 7, shares of Restricted Stock may not be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated until the end of the applicable
Restriction Period as specified in the Restricted Stock Agreement, or upon
earlier satisfaction of any other conditions determined at the time of grant
specified in the Restricted Stock Agreement. Except as provided in Section 7.9,
however, in no event may any Restricted Stock become vested in a Participant
subject to Section 16(b) of the Exchange Act prior to 6 months following the
date of its grant.

     7.4  Other Restrictions.  The Committee shall impose such other
restrictions on shares of Restricted Stock as it may deem advisable, including,
without limitation, restrictions based upon the achievement of specific
performance goals (relating to the Company, a Subsidiary or regional or other
operating division of the Company), years of service and/or restrictions under
applicable Federal or state securities laws.  The Committee may provide that any
share of Restricted Stock shall be held (together with a stock power executed in
blank by the Participant) in custody by the Company until any or all
restrictions thereon shall have lapsed.

     7.5  Forfeiture.  The Committee shall determine and set forth in a
Participant's Restricted Stock Agreement such events upon which a Participant's
shares of Restricted Stock shall be forfeitable, which may include, without
limitation, the termination of a Participant's employment during the Restriction
Period.  Any such forfeited shares of Restricted Stock shall be immediately
returned to the Company by the Participant and the Participant shall only
receive the amount, if any, paid by the Participant for such Restricted Stock.

     7.6  Certificate Legend.  In addition to any legends placed on certificates
pursuant to Section 7.4, each certificate representing shares of Restricted
Stock shall bear the following legend:

          "The sale or other transfer of the shares represented by this
          Certificate, whether voluntary, involuntary or by operation of law, is
          subject to certain restrictions on transfer as set forth in the Papa
          John's International, Inc. 1993 Stock Ownership Incentive Plan, and in
          the related Restricted Stock Agreement.  A copy of the Plan and

                                      -8-

<PAGE>
 
          such Restricted Stock Agreement may be obtained from the Secretary of
          Papa John's International, Inc."

     7.7 Removal of Restrictions. Except as otherwise provided in this Article
7, shares of Restricted Stock shall become freely transferable by the
Participant and no longer subject to forfeiture after the last day of the
Restriction Period. Once the shares of Restricted Stock are released from their
restrictions, the Participant shall be entitled to have the legend required by
Section removed from the Participant's share certificate, which certificate
shall thereafter represent freely transferable and nonforfeitable shares of
Common Stock free from any and all restrictions under the Plan.

     7.8  Voting Rights; Dividends and Other Distributions. Unless the Committee
exercises its discretion as provided in Section , during the Restriction Period,
Participants holding shares of Restricted Stock may exercise full voting rights,
and shall be entitled to receive all dividends and other distributions paid with
respect to such Restricted Stock. If any dividends or distributions are paid in
Common Stock, such Common Stock shall be subject to the same restrictions as the
shares of Restricted Stock with respect to which they were paid.

     7.9 Lapse of Restrictions Upon Change in Control. Upon a Change in Control,
any restrictions and other conditions pertaining to then outstanding shares of
Restricted Stock held by Participants, including, but not limited to, vesting
requirements, shall lapse and such shares shall thereafter be immediately
transferable and nonforfeitable.

     7.10 Treatment of Dividends. At the time shares of Restricted Stock are
granted to a Participant, the Committee may, in its discretion, determine that
the payment of dividends, or a specified portion thereof, declared or paid on
such shares shall be deferred until the lapse of the restrictions with respect
to such shares, such deferred dividends to be held by the Company for the
account of the Participant. In the event of such deferral, there may be credited
at the end of each year (or portion thereof) interest on the amount of the
account during the year at a rate per annum as the Committee, in its discretion,
may determine. Deferred dividends, together with interest accrued thereon, if
any, shall be (a) paid to the Participant upon the lapse of restrictions on the
shares of Restricted Stock as to which the dividends related or (ii) forfeited
to the Company upon the forfeiture of such shares by the Participant.

     7.11 Termination of Employment. If the employment of a Participant is
terminated for any reason other than death or Disability prior to the expiration
of the Restriction Period applicable to any shares of Restricted Stock then held
by the Participant, such shares shall thereupon be forfeited immediately by the
Participant and returned to the Company, and the Participant shall only receive
the amount, if any, paid by the Participant for such Restricted Stock. If the
employment of a Participant is terminated as a result of death or Disability
prior to the expiration of the Restriction Period applicable to any shares of
Restricted Stock then held by the Participant, any restrictions and other
conditions pertaining to such shares then held by the Participant, including,
but not limited to, vesting requirements, shall immediately lapse and such

                                      -9-

<PAGE>
 
shares shall thereafter be immediately transferable and nonforfeitable.
Notwithstanding anything in the Plan to the contrary, the Committee may
determine, in its sole discretion, in the case of any termination of a
Participant's employment other than for Cause, that the restrictions on some or
all of the shares of Restricted Stock awarded to a Participant shall immediately
lapse and such shares shall thereafter be immediately transferable and
nonforfeitable.

ARTICLE 8.  PERFORMANCE UNITS
     
     8.1  Grant of Performance Units. The Committee may, from time to time and
upon such terms and conditions as it may determine, grant Performance Units
which will become payable to Participant upon achievement of specified
Performance Goals.

     8.2  Performance Unit Agreement.  Each Performance Unit grant shall be
evidenced by a Performance Unit Agreement that shall specify the Performance
Goals, the Performance Period and the number of Performance Units to which it
pertains.

     8.3  Performance Period. The period of performance ("Performance Period")
with respect to each Performance Unit shall be such period of time, which shall
not be less than one year, nor more than five years, as determined by the
Committee, for the measurement of the extent to which Performance Goals are
attained. The Performance Period may commence prior to the date of grant of the
Performance Unit to which it relates.

     8.4  Performance Goals.  The goals ("Performance Goals") that are to be
achieved with respect to each Performance Unit shall be those objectives
established by the Committee as it deems appropriate, and which may relate to
the net income, growth in net income, earnings per share, growth of earnings per
share, return on equity or return on capital, of the Company, or any other
performance objectives relating to the Company, a Subsidiary or regional or
other operating unit of the Company, or the individual Participant.  Each
Performance Unit Agreement shall specify a minimum acceptable level of
achievement with respect to the Performance Goals below which no payment will be
made and shall set forth a formula for determining the payment to be made if
performance is at or above such minimum based upon a range of performance levels
relating to the Performance Goals.

     8.5  Adjustment of Performance Goals.  The Committee may adjust Performance
Goals and the related minimum acceptable level of achievement if, in the sole
judgment of the Committee, events or transactions occur subsequent to the date
of grant which are unrelated to the performance of the Participant and which the
Committee expects to have a substantial effect on the ability of the Participant
to attain the Performance Goals.  If a Participant is promoted, demoted or
transferred to a Subsidiary or different operating division of the Company
during a Performance Period, then, to the extent that the Committee determines
the Performance Goals or Performance Period are no longer appropriate, the
Committee may, but shall not be required to, adjust, change or eliminate the
Performance Goals or the applicable Performance Period as it

                                      -10-

<PAGE>
 
deems appropriate in order to make them appropriate and comparable to the
initial Performance Goals or Performance Period.

     8.6  Termination of Employment.  If the employment of a Participant shall
terminate prior to the expiration of the Performance Period for any reason other
than for death, Disability or Retirement, the Performance Units then held by the
Participant shall terminate. In the case of termination of employment by reason
of death, Disability or Retirement of a Participant prior to the expiration of
the Performance Period, any then outstanding Performance Units of such
Participant shall be payable in an amount equal to the maximum amount payable
under the Performance Unit multiplied by a percentage equal to the percentage
that would have been earned under the terms of the Performance Unit Agreement
assuming that the rate at which the Performance Goals have been achieved as of
the date of such termination of employment would have continued until the end of
the Performance Period; provided, however, that if no maximum amount payable is
specified in the Performance Unit Agreement, the amount payable shall be such
amount as the Committee shall determine is reasonable.

     8.7  Payment Upon Change in Control.  Upon a Change in Control, any then
outstanding Performance Units shall become fully vested and immediately payable
in an amount which is equal to the greater of (a) the maximum amount payable
under the Performance Unit multiplied by a percentage equal to the percentage
that would have been earned under the terms of the Performance Unit Agreement
assuming that the rate at which the Performance Goals have been achieved as of
the date of such Change in Control would have continued until the end of the
Performance Period or (b) the maximum amount payable under the Performance Unit
multiplied by the percentage of the Performance Period completed by the
Participant at the time of the Change in Control; provided, however, that if no
maximum amount payable is specified in the Performance Unit Agreement, the
amount payable shall be such amount as the Committee shall determine is
reasonable.

     8.8  Payment of Performance Units.  Subject to such terms and conditions as
the Committee may impose, and unless otherwise provided in the Performance Unit
Agreement, Performance Units shall be payable within 90 days following the end
of the Performance Period during which the Participant attained at least the
minimum acceptable level of achievement under the Performance Goals, or 90 days
following a Change in Control, as applicable. The Committee, in its discretion,
may determine at the time of payment required in connection with a Performance
Unit whether such payment shall be made (a) solely in cash or (b) up to 50% in
shares of Common Stock (valued at their Fair Market Value as of the close of
business on the date of payment) with the balance in cash; provided, however,
that if a Performance Unit becomes payable upon a Change in Control, the
Performance Unit shall be paid solely in cash.

     8.9  Designation of Beneficiary.  Each Participant may, from time to time,
name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom the right to receive payments under a Performance Unit is
to be paid in case of the Participant's death before receiving any or all such
payments. Each such designation shall revoke all prior

                                     -11-

<PAGE>
 
designations by the Participant, shall be in a form prescribed by the Company
and shall be effective only when filed by the Participant in writing with the
Committee during the Participant's lifetime. In the absence of any such
designation, benefits remaining unpaid at the Participant's death shall be paid
to the Participant's estate.

ARTICLE 9.     AMENDMENT, MODIFICATION AND TERMINATION

     9.1  Termination Date.  The Plan shall terminate on the earliest to occur
of (a) the tenth anniversary of the Effective Date, (b) the date when all shares
of Common Stock available under the Plan shall have been acquired and the
payment of all benefits in connection with Performance Unit Awards has been made
or (c) such other date as the Board may determine in accordance with Section 
9.2.

     9.2  Amendment, Modification and Termination.  The Board may, at any time,
amend, modify or terminate the Plan.  However, without the approval of
stockholders of the Company (as may be required by the Code, Section 16 of the
Exchange Act and the rules promulgated thereunder, any national securities
exchange or system on which the Common Stock is then listed or reported or a
regulatory body having jurisdiction with respect hereto), no such amendment,
modification or termination may:

     (a) materially increase the benefits accruing to Participants under the
Plan;

     (b) materially increase the total number of shares of Common Stock which
may be issued under the Plan, except as provided in Section 4.3; or

     (c) materially modify the class of Employees eligible to participate in the
Plan.

The Committee may amend the terms of any Award, prospectively or retroactively,
but no such amendment shall impair the rights of any Participant without such
Participant's consent.

     9.3  Awards Previously Granted.  No amendment, modification or termination
of the Plan shall in any manner adversely affect any outstanding Award without
the written consent of the Participant holding such Award.

ARTICLE 10.  NON-TRANSFERABILITY

     A Participant's rights under this Plan may not be assigned, pledged or
otherwise transferred other than by will or the laws of descent and
distribution, except that upon a Participant's death, the Participant's rights
to payment pursuant to a Performance Unit may be transferred to a beneficiary
designated in accordance with Section 8.9. Notwithstanding anything herein to
the contrary, in the case of NQSOs, the Committee may, in its sole discretion,
by appropriate provisions in the Participant's Option Agreement, permit the
Participant to transfer all or a portion of the Option, without consideration,
to (i) the Participant's spouse or lineal

                                     -12-

<PAGE>
 
descendants ("Family Members"), (ii) a trust for the exclusive benefit of Family
Members, (iii) a charitable remainder trust of which the Participant and/or
Family Members are the exclusive beneficiaries (other than the charitable
beneficiary), or (iv) a partnership or a limited liability company in which the
Participant and Family Members are the sole partners or members, as applicable.
In the event that any Option is transferred by a Participant in accordance with
the provisions of the immediately preceding sentence, then subsequent transfers
of the Option by the transferee shall be prohibited. For purposes of the Option
Agreement and the Plan, the term "Optionee" shall be deemed to refer to the
transferee wherever applicable, and the provisions of Section 6.7 regarding
termination of employment shall refer to the Participant, not the transferee,
but the transferee shall be permitted to exercise the Option during the period
provided for in Section 6.7 and the Participant's Option Agreement following the
Participant's termination of employment.


ARTICLE 11.  NO GRANTING OF EMPLOYMENT RIGHTS

     Neither the Plan, nor any action taken under the Plan, shall be construed
as giving any Employee the right to become a Participant, nor shall
participation in, or any grant of an Award under, the Plan be construed as
giving a Participant any right with respect to continuance of employment by the
Company. The Company expressly reserves the right to terminate, whether by
dismissal, discharge or otherwise, a Participant's employment at any time, with
or without Cause, except as may otherwise be expressly provided by any written
agreement of employment between the Company and the Participant.

ARTICLE 12.  WITHHOLDING

     12.1  Tax Withholding.  A Participant shall remit to the Company an amount
sufficient to satisfy Federal, state and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any grant, exercise or lapse of restrictions made under, or occurring as a
result of, the Plan.

     12.2  Share Withholding.  If the Company has a withholding obligation upon
the issuance of Common Stock under the Plan, a Participant may, subject to the
discretion of the Committee, elect to satisfy the withholding requirement, in
whole or in part, by having the Company withhold shares of Common Stock having a
Fair Market Value on the date the withholding tax is to be determined equal to
the amount required to be withheld under applicable law.  Notwithstanding the
foregoing, the Committee may, by the adoption of rules or otherwise, modify the
provisions of this Section 12.2 or impose such other restrictions or limitations
on such elections as may be necessary to insure that such elections will be
exempt transactions under Section 16(b) of the Exchange Act.

                                     -13-

<PAGE>
 
ARTICLE 13.  INDEMNIFICATION

     No member of the Board or the Committee, nor any officer or Employee acting
on behalf of the Board or the Committee, shall be personally liable for any
action, determination or interpretation taken or made with respect to the Plan,
and all members of the Board, the Committee and each and any officer or Employee
of the Company acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Company with respect to any such action,
determination or interpretation.

ARTICLE 14.  SUCCESSORS

     All obligations of the Company with respect to Awards granted under the
Plan shall be binding on any successor to the Company, whether the existence of
such successor is a result of a direct or indirect purchase, merger,
consolidation or otherwise, of all or substantially all of the business and/or
assets of the Company.

ARTICLE 15.  GOVERNING LAW

     The Plan shall be governed by, and construed in accordance with, the laws
of the State of Delaware without regard to its conflict of laws rules; provided,
however, that with respect to ISOs, the Plan and all agreements under the Plan
shall be construed so that they qualify as incentive stock options within the
meaning of section 422 of the Code.


     IN WITNESS WHEREOF, Papa John's International, Inc. has caused this 1993
Stock Ownership Incentive Plan to be executed by its Board of Directors this
15th day of April, 1993.



                                    PAPA JOHN'S INTERNATIONAL, INC.


                                    By: /s/ John H. Schnatter
                                       --------------------------------------
                                        John H. Schnatter
                                        Chairman of the Board


Changes to Plan Document:
- ------------------------ 

The number of shares reserved for issuance under the Plan has been adjusted to
reflect (i) a 3-for-2 stock split, effected in the form of a 50% stock dividend,
effective March 25, 1996 for holders of record on March 12, 1996, and (ii) a 3-
for-2 stock split, effected in the form of a 50% stock dividend, effective
November 22, 1996 for holders of record on November 8, 1996.

                                      -14-

<PAGE>
 
Revised to reflect amendments approved by the Board of Directors on February 14,
1996 and stockholders on May 22, 1996.

Revised to reflect amendments approved by the Board of Directors October 29,
1996.

                                      -15-

<PAGE>
 
                                  AMENDMENT TO
                        PAPA JOHN'S INTERNATIONAL, INC.
                      1993 STOCK OWNERSHIP INCENTIVE PLAN


RECITALS:
- -------- 

     A.  Papa John's International, Inc. ("Company") adopted the Papa John's
International, Inc. 1993 Stock Ownership Incentive Plan, as heretofore amended
("Plan").

     B.  The Company desires to amend the Plan to increase the number of shares
of Common Stock reserved for issuance under the Plan and to address certain tax
deductibility limits imposed by the Omnibus Budget Reconciliation Act of 1993
and to preserve for the Company the tax deduction for certain compensation paid
thereunder.

AGREEMENT:
- --------- 

     In consideration of the premises, the Company hereby agrees as follows:

     1.   Amendment of Plan.
          ----------------- 

          (a) Section 3.2 of the Plan is amended by adding at the end thereof
the following:

     "Notwithstanding the foregoing, the Committee may not delegate its
     responsibilities hereunder if such delegation would jeopardize compliance
     with the "outside directors" requirement (or any other applicable
     requirement) under section 162(m) of the Code."


          (b) The first sentence of Section 4.1 of the Plan is amended to read
in its entirety as follows:

     Subject to adjustment as provided in Section 4.3, the number of shares of
     Common Stock reserved for issuance under the Plan is __________.

                                      -16-

<PAGE>
 
          (c) Section 6.2 of the Plan is amended by adding the following after
the second sentence of such section:

     "The maximum number of shares in respect of which Options may be granted to
     a Participant during any calendar year shall be 250,000 shares."


          (d) Section 8.1 of the Plan is amended by adding at the end thereof
the following:

     "The maximum number of Performance Units which may be allocated to a
     Participant during any calendar year shall be 150,000 Units."


          (e) Section 8.4 of the Plan is amended by adding at the end thereof
the following:

     "The Committee shall establish Performance Goals applicable to a particular
     fiscal year within ninety (90) days of the commencement of such fiscal
     year, provided that the outcome of the Performance Goals is substantially
     uncertain at the time of their adoption."


          (f) Section 8.8 of the Plan is amended by adding the following after
the first sentence of such section:

     "The Committee shall certify that the Performance Goal(s) for awards of
     Performance Units under the Plan have been satisfied prior to the
     determination and payment of any such incentive in accordance with the
     Plan."


          (g) Section 9.2 of the Plan is amended by adding at the end thereof
the following:

     "Each Option and certain Performance Units granted under the Plan are
     intended to be performance-based compensation within the meaning of Section
     162(m)(4)(C) of the Code.  The Committee shall not be entitled to exercise
     any discretion otherwise authorized hereunder

                                      -17-

<PAGE>
 
     with respect to such Options or Units if the ability to exercise such
     discretion or the exercise of such discretion itself would cause the
     compensation attributable to such Options or Units to fail to qualify as
     performance-based compensation."

 
     2.  Continuation of Plan.  Except as amended hereby, the Plan remains
unchanged and in full force and effect.

     3.  Governing Law.  This Amendment shall be governed by, and construed in
accordance with, the laws of the State of Delaware without regard to its
conflict of law rules.

     IN WITNESS WHEREOF, the Company has caused this Amendment to be signed as
of the _____ day of ________, 1997, being the effective date of the Amendment
specified by the Board of Directors.

                              PAPA JOHN'S INTERNATIONAL, INC.


                              By:
                                 ---------------------------
                              Title:
                                    ------------------------

                                      -18-