Papa John's founder John Schnatter resigned as chairman of the pizza company's board late Wednesday night, hours after apologizing for using the n-word during a May conference call with a marketing agency.
Schnatter previously stepped down as his company's chief executive in January after he said that the National Football League player protests were hurting his pizza sales. The 56-year-old admitted to and apologized for using the n-word Wednesday after he was the subject of a Forbes report that documented his use of the racial slur.
"News reports attributing the use of inappropriate and hurtful language to me during a media training session regarding race are true," he said in a statement. "Regardless of the context, I apologize. Simply stated, racism has no place in our society."
Hours later, the pizza company he founded in the 1980s announced in a brief statement that Schnatter had quit the board. It added that the company will appoint a new chairman in the coming weeks.
The Forbes report detailed that Schnatter uttered the slur during a call in May with other Papa John's executives and the marketing agency Laundry Service, going through a role-playing exercise meant to prepare for public relations challenges.
Schnatter reportedly was asked how he would separate himself from racist groups online and responded by "downplaying the significance of his NFL statement," according to Forbes.
"Colonel Sanders called blacks n—s," Schnatter reportedly said, complaining that Kentucky Fried Chicken had not faced any backlash over Sanders' statements.
Schnatter also reportedly recounted his early life in Indiana, stating that African Americans were dragged behind trucks until they died. Some people on the call told Forbes that they believed he was trying to explain how relatively harmless his actions seemed in relation to those hate crimes.
Laundry Service declined to comment on the Forbes story. It was reportedly forced to lay off 10 percent of its employees after revoking its contract with the restaurant.
Schnatter founded Papa John's Pizza shortly after graduating from Ball State University, according to the company's website. He opened the first restaurant in 1985 in Jeffersonville, Indiana and eventually expanded to more than 5,100 locations around the world.
Although he had stepped down as the chief executive, Schnatter was still acting as the chairman and as a de facto mascot for the company.
In November, Schnatter drew criticism after a call with investors when he blamed slow sales on the NFL's "poor" leadership over the National Anthem demonstration. Papa John's was an NFL advertiser and official pizza of the league.
"This year, the ratings have gone backwards because of the controversy," he said at the time. "The controversy is polarizing the customer, polarizing the country."
The company announced in December that he'd be stepping down as the chief executive on January 1.