DAVID L. GOEBEL
 APPLEBEE'S INTERNATIONAL, INC.
 EMPLOYMENT AGREEMENT
 
 This Employment Agreement ("Agreement") is made effective as of January 9,
2006, by and between Applebee's International, Inc., a Delaware corporation (the
"Company"), and David L. Goebel (the "Executive").
 
 WHEREAS, the Company believes it to be in its best interest to provide for
continuity of management and to provide protection for its valuable trade
secrets and confidential information; and
 
 WHEREAS, the Company desires to employ the Executive and the Executive is
willing to render his services to the Company on the terms and conditions with
respect to such employment hereinafter set forth.
 
 NOW, THEREFORE, in consideration of premises and the mutual terms and
conditions hereof, the Company and the Executive hereby agree as follows:
 
 1. Employment. The Company hereby employs the Executive and the Executive
hereby accepts employment with the Company upon the terms and conditions
hereinafter set forth.
 
 2. Exclusive Services. The Executive shall devote all necessary working
time, ability and attention to the business of the Company during the term of
this Agreement and shall not, directly or indirectly, render any material
services to any business, corporation, or organization whether for compensation
or otherwise, without the prior knowledge and written consent of the chief
executive officer (the "CEO") or the Board of Directors of the Company
(hereinafter referred to as the "Board").
 
 3. Duties. The Executive is hereby employed as President and Chief
Operating Officer of the Company and shall render his services at the principal
business offices of the Company, as such may be located from time to time,
unless otherwise agreed in writing between the Board and the Executive. The
Executive shall have such authority and shall perform such duties as are
described in Exhibit A attached hereto.
 
 4. Term. This Agreement shall have an initial term of three (3) years
commencing as of January 3, 2006. This Agreement will automatically renew at the
end of the initial term and at the end of each subsequent term, for a subsequent
term of one (1) year unless either party gives written notice of non-renewal to
the other at least sixty (60) days prior to the expiration of the then current
term. Such notice may be given for any or no reason. This Agreement is subject
to earlier termination as hereinafter provided.
 
 5. Compensation. As compensation for his services rendered under this
Agreement, the Executive shall be entitled to receive the following:
 
 a. Base Salary. The executive shall be paid a base salary of at least
 $550,000 per year, payable in 26 equal bi-weekly installments during the
 term of this
 
 

 
 
 Agreement, prorated for any partial employment month. Such base salary
 ("Base Salary") may be increased by the Board in its sole discretion.
 
 b. Additional Compensation. The Executive shall be paid such
 additional compensation and bonuses as may be determined and authorized in
 the sole discretion of the Board. The Executive's target bonus for fiscal
 year 2006 is 100% of his Base Salary.
 
 6. Benefits. In addition to the compensation to be paid to the Executive
pursuant to Section 5 hereof, the Executive shall further be entitled to receive
the following:
 
 a. Participation in Employee Plans. The Executive shall be entitled to
 participate in any health, disability, group term life insurance plan, any
 pension, retirement, or profit sharing plan, any executive bonus plan, or
 any other perquisites and fringe benefits that may be extended generally
 from time to time to employees of the Company at the level of Executive
 Vice President.
 
 b. Vacation. The Executive shall be entitled to a minimum of four
 weeks vacation with full salary and benefits each year. Under current
 Company policy (which may be changed at the discretion of the Company) no
 cash or other payment will be due, however, for unused vacation and
 vacation may not be carried over from any calendar year to the next. Upon
 any termination of the Executive's employment, earned but unused vacation
 will be paid in accordance with the Company's policy then in effect.
 
 c. Equity Awards. The Executive shall be entitled to equity-based
 compensation awards that may be extended generally from time to time to
 employees of the Company at the level of Executive Vice President, as
 approved by the Board, subject to the terms and conditions of the
 respective equity-based compensation plans and award agreements and the
 provisions of this Agreement.
 
 7. Reimbursement of Expenses. Subject to such rules and procedures as from
time to time are specified by the Company, the Company shall reimburse the
Executive on a monthly basis for reasonable business expenses necessarily
incurred in the performance of his duties under this Agreement.
 
 8. Confidentiality/Trade Secrets. The Executive acknowledges that his
position with the Company is one of the highest trust and confidence both by
reason of his position and by reason of his access to and contact with the trade
secrets and confidential and proprietary business information of the Company.
Both during the term of this Agreement and thereafter, the Executive covenants
and agrees as follows:
 
 a. He shall use his best efforts and exercise reasonable diligence to
 protect and safeguard the trade secrets and confidential and proprietary
 information of the Company, including but not limited to the identity of
 its customers and suppliers, its arrangements with customers and suppliers,
 and its technical and financial data, records, compilations of information,
 processes, recipes and specifications relating to its customers, suppliers,
 products and services;
 
 
 -2-
 
 

 
 
 b. He shall not disclose any of such trade secrets and confidential
 and proprietary information, except as may be required in the course of his
 employment with the Company or by law; and
 
 c. He shall not use, directly or indirectly, for his own benefit or
 for the benefit of another, any of such trade secrets and confidential and
 proprietary information.
 
 All files, records, documents, drawings, specifications, memoranda, notes,
or other documents relating to the business of the Company, whether prepared by
the Executive or otherwise coming into his possession, shall be the exclusive
property of the Company and shall be delivered to the Company and not retained
by the Executive upon termination of his employment for any reason whatsoever or
at any other time upon request of the Board, or, at the option of the Executive,
he may destroy all such material and certify such destruction in writing to the
Company within ten (10) days following the termination of his employment or such
request by the Company.
 
 9. Discoveries. The Executive covenants and agrees that he will fully
inform the Company of and disclose to the Company all inventions, designs,
improvements, discoveries, and processes ("Discoveries") that he has now or may
hereafter have during his employment with the Company and that pertain or relate
to the business of the Company or to any experimental work, products, services,
or processes of the Company in progress or planned for the future, whether
conceived by the Executive alone or with others, and whether or not conceived
during regular working hours or in conjunction with the use of any Company
assets. All such Discoveries shall be the exclusive property of the Company
whether or not patent or trademark applications are filed thereon. The Executive
shall assist the Company, at any time during or after his employment, in
obtaining patents on all such Discoveries deemed patentable by the Company and
shall execute all documents and do all things necessary to obtain letters
patent, vest the Company with full and exclusive title thereto, and protect the
same against infringement by others, all at the expense of the Company. If such
assistance takes place after his employment is terminated, then the Executive
shall be paid by the Company at an hourly rate determined based on fifty percent
(50%) of his existing salary at the date of termination divided by 2500 for any
time actually spent in rendering such assistance at the request of the Company.
 
 10. Non-Competition. The Executive covenants and agrees that during the
period of his employment and for additional periods after termination of
employment as provided in Section 13 or 14, he shall not, without the prior
written consent of the CEO or the Board, directly or indirectly, as an employee,
employer, consultant, agent, principal, partner, shareholder, corporate officer,
director, or through any other kind of ownership (other than ownership of
securities of publicly held corporations of which the Executive owns less than
five percent 5% of any class of outstanding securities) or in any other
representative or individual capacity, engage in or render any services to any
business in North America engaged in the casual dining restaurant industry, or
in any other segment of the restaurant industry in which the Company or any
subsidiary of the Company may become involved after the date hereof and prior to
the date of termination of Executive's employment. For purposes of this
Agreement "casual dining restaurant industry" consists of "sit down table
service" restaurants serving alcoholic beverages, with a per guest average guest
check within the United States of under $20.00 (adjusted upward each year to
recognize Company menu price increases).
 
 
 -3-
 
 

 
 
 11. Nonsolicitation. The Executive agrees that during the period of his
employment, and for a period of two (2) years following the effective date of
the termination of the Executive's employment for any reason, he will not,
either directly or indirectly, for himself or for any third party, except as
otherwise agreed to in writing by the Company's Chief Executive Officer, employ
or hire any other person who is then employed by the Company, or solicit,
induce, recruit, or cause any other person who is then employed by the Company
to terminate his/her employment for the purpose of joining, associating, or
becoming employed with any business or activity that is engaged in the casual
dining restaurant industry or any other segment of the restaurant industry in
which the Company may become involved after the date hereof and prior to the
date of any termination of employment.
 
 12. Remedies for Breach of Covenants of the Executive.
 
 a. The Company and the Executive specifically acknowledge and agree
 that the foregoing covenants of the Executive in Sections 8, 9, 10, and 11
 are reasonable in content and scope and are given by the Executive for
 adequate consideration. The Company and the Executive further acknowledge
 and agree that, if any court of competent jurisdiction or other appropriate
 authority shall disagree with the parties' foregoing agreement as to
 reasonableness, then such court or other authority shall reform or
 otherwise the foregoing covenants as reason dictates.
 
 b. The covenants set forth in Sections 8, 9, 10 and 11 of this
 Agreement, as provided in Section 13 or 14, shall continue to be binding
 upon the Executive, notwithstanding the termination of his employment with
 the Company for any reason whatsoever. Such covenants shall be deemed and
 construed as separate agreements independent of any other provisions of
 this Agreement and any other agreement between the Company and the
 Executive. The existence of any claim or cause of action by the Executive
 against the Company, unless predicated on this Agreement, shall not
 constitute a defense to the enforcement by the Company of any or all such
 covenants. It is expressly agreed that the remedy at law for the breach of
 any such covenant is inadequate and injunctive relief and specific
 performance shall be available to prevent the breach or any threatened
 breach thereof.
 
 13. Termination. This Agreement (other than Sections 8, 9, 10 and 11, as
provided in Section 13 or 14, shall survive any termination hereof for any
reason, including the expiration hereof due to non-renewal (an "Expiration"))
may be terminated as follows:
 
 a. If within the two (2) year period following an Expiration of this
 Agreement the Executive ceases to continue in the employ of the Company,
 the Company may elect to make Severance Payments to the Executive under
 Section 13(g)(i), (ii) and (vii) and, if so, the provisions of Section 10
 shall survive and be in force for the Severance Payment Period. The Company
 must make an election and must notify the Executive of such an election to
 provide these Severance Payments within the first ninety (90) day period
 following an Expiration of this Agreement. If no such election is made by
 the Company to make Severance Payments within the first ninety (90) days
 following Expiration and the Executive is no longer in the employ of the
 Company and the Company did not offer renewal of this Agreement, the
 provisions of Section 10 will be
 
 
 -4-
 
 

 
 
 terminated effective ninety (90) days after Expiration of this Agreement.
 If no such election is made by the Company to make Severance Payments
 within the first ninety (90) days following Expiration and the Executive is
 no longer in the employ of the Company and the Expiration was caused by the
 Executive's election, then the Company shall have the balance of the two
 (2) year period following Expiration in which to elect to make Severance
 Payments. In addition, if the Executive does not continue to offer his
 services to the Company (illness notwithstanding) in his then capacity and
 consistent with his prior practice, for at least 120 days following an
 Expiration caused by his election, the provisions of Section 10 shall
 survive and be in force during such one hundred twenty (120) days and for
 one (1) year thereafter, and no Severance Payments of any kind shall be
 required of the Company.
 
 b. The Company may terminate this Agreement and the Executive's
 employment hereunder at any time, with or without Cause, upon written
 notice to the Executive. Upon any such termination by the Company, the
 Executive shall immediately resign from the Company's Board of Directors.
 The Executive may terminate this Agreement and his employment hereunder, at
 any time, with or without Good Reason. In the event of a termination by the
 Executive without Good Reason the provisions of Section 10 shall survive
 and be in force for 24 months.
 
 c. In the event of termination by the Company without Cause, (i) the
 effective date thereof shall be stated in a written notice to the Executive
 from the Board, which shall not be earlier than 30 days from the date such
 written notice is delivered to the Executive, (ii) the Executive shall be
 entitled to receive all Severance Payments under Section 13(g), (iii) the
 provisions of Section 10 shall survive and be in force for the Severance
 Payment Period, and (iv) the Executive may within the 30 day notice period
 in subparagraph (i), above, by written notice to the Company, elect to
 retire and receive all benefits to which he may entitled under the
 Company's Executive Retirement Program.
 
 d. In the event of termination by the Company with Cause, the
 Executive shall be entitled to receive only his salary through such date of
 termination and any bonus amounts as may be payable pursuant to the terms
 of any written plans in which the Executive was a participant immediately
 prior to the effective date of the termination and the provisions of
 Section 10 shall survive and be in force for 24 months. The Executive shall
 also be entitled to exercise his rights under COBRA at the Executive's
 expense.
 
 e. The following shall constitute "Cause":
 
 (i) The Executive is convicted of -- or pleads no contest / nolo
 contendre to -- any felony or any other serious criminal offense; or
 
 (ii) The Executive breaches any material provision of this
 Agreement (other than as related to Sections 8, 9, 10 and 11 which is
 covered by Section 13(e)(iii) below), or habitually neglects to
 perform his duties under this Agreement (other than for reasons
 related to illness, injury or temporary disability) and such breach or
 neglect is not corrected in the Company's good faith
 
 
 -5-
 
 

 
 
 belief within fifteen (15) business days after receipt of written
 notice from the Board of the Company; or
 
 (iii) The Executive breaches any provision of Section 8, 9, 10 or
 11, and such breach is not corrected in the Company's good faith
 belief within five (5) business days after receipt of written notice
 from the Chief Executive Officer; or
 
 (iv) The Executive is determined to have intentionally acted in
 material violation of any applicable local, state or federal law
 relating to discrimination or harassment;
 
 (v) The Executive violates any material Company policy applicable
 to senior executives of the Company;
 
 (vi) The Executive acts, without Board direction or approval, in
 a manner that is injurious to the financial condition of the Company;
 or
 
 (vii) The Executive dies or becomes permanently disabled from
 continuing to provide the level of service required under this
 Agreement. In the event of the Executive's permanent disability, the
 Executive, or his designated agent, may elect for the Executive to
 retire and receive all benefits to which he may entitled under the
 Company's Executive Retirement Program.
 
 f. The Executive shall have "Good Reason" to effect a termination in
 the event that the Company (i) breaches its obligations to pay any salary,
 benefit or bonus due hereunder or, (ii) requires the Executive to relocate
 more than 50 miles from the greater Kansas City area, (iii) diminishes the
 functional responsibilities of the Executive in a manner that would cause
 an analysis of the remaining functional responsibilities of the Executive
 to receive a Hay point rating of less than 3837, or (iv) reduces the total
 direct compensation of the Executive from one year to the next by more that
 20 percentage points from the average change in total direct compensation
 for the other four most highly paid executives of the Company (as an
 example, if the change for each of the other four executives was +6%, -8%,
 +10% and -4%, for an average change of +4%, then the change for the
 Executive could not be more than -16%); and in the event of any of (i),
 (ii), (iii) or (iv), the Executive has given written notice to the Board as
 to the details of the basis for such Good Reason within 30 days following
 the date on which the Executive alleges the event giving rise to such Good
 Reason occurred and the Company has failed to provide a reasonable cure
 within ten (10) days after its receipt of such notice. In the event of a
 termination by the Executive with Good Reason, the Executive will be
 entitled to all Severance Payments under Section 13(g) and the provisions
 of Section 10 shall survive and be in force for the Severance Payment
 Period.
 
 g. The "Severance Payments" consist of the following: (i) an amount
 paid monthly equal to one-twelfth (1/12) of the Executive's annual Base
 Salary at the current effective annual rate, paid for the Severance Payment
 Period; (ii) an amount paid monthly equal to one-twelfth (1/12) of the
 greater of (y) the average of the Executive's actual
 
 
 -6-
 
 

 
 
 bonus attributable to each of the preceding three (3) fiscal years or (z)
 Executive's target bonus amount for the fiscal year in which the
 termination occurred multiplied by the average percentage bonus attainment
 of the Executive over the preceding three (3) fiscal years, in either case
 paid for the Severance Payment Period; (iii) the immediate vesting of any
 unvested stock options, stock appreciation rights, and other equity-based
 awards held by the Executive as of the day immediately preceding the
 effective date of termination; (iv) with respect to all Restricted Share
 awards, all restrictions will immediately be removed and deemed to have
 been satisfied and any vesting periods will be accelerated; (v) if such
 payment was earned by the Executive at the effective time of the
 termination, the accelerated payment of the Company's FlexPerks benefit for
 the year in which the termination occurs; (vi) the continued payment for
 the duration of the Severance Payment Period, of the Company's matching
 portion of the Executive's Non-Qualified Deferred Compensation Plan (or
 such retirement arrangement, if any, as may replace it); and (vii) the
 payment by the Company of premiums on behalf of the Executive, for coverage
 substantially similar to that provided under the Company's group health and
 medical policies, for so long as the Executive elects to continue such
 coverage, but for no longer than the Severance Payment Period.
 
 h. The "Severance Payment Period" is initially the twenty-four (24)
 month period immediately following the effective date of termination of the
 Executive's employment. The Severance Payment Period may be extended, at
 the sole discretion of the Company, by written notice to the Executive
 within 30 days after the effective date of termination of employment, for
 up to 12 additional months by the continued payment of the amounts under
 Section 13(g)(i) and (ii). For clarity sake, such extension of the
 Severance Payment Period by the Company will cause all payments and
 benefits under this Agreement, including if the Executive has so elected,
 the amounts payable under subparagraph 13(g)(vii), above, to be made for a
 total of 36 months.
 
 i. In the event of any termination of the Executive, whether by the
 Executive or the Company and for any reason, participation by the Executive
 in all compensation and benefit plans of the Company will cease upon the
 effective termination date and all unvested bonuses, equity awards and
 other like items will immediately lapse, except as specifically provided in
 subsection (g), above. All amounts owed by the Executive to the Company for
 any reasons whatsoever will become immediately due and payable and the
 Company will have the right in its discretion to collect any or all such
 amounts by offset against any amounts due to the Executive from the Company
 whether or not under this Agreement. In addition, the Severance Payments
 hereunder are in lieu of and supercede any other severance or termination
 benefits to which the Executive might otherwise be entitled, including any
 benefits under the Company's Severance Program for Salaried Associates.
 
 14. Termination After Change in Control. If within 12 months following a
Change in Control, as defined below, the employment of the Executive is
terminated by the Company or by the Executive, for any reason whatsoever, then
the provisions of Section 13 shall not apply and the following shall occur:
 
 a. On the tenth business day following the effective date of such
 termination, the Executive shall receive a lump sum payment equal to two
 (2) times the sum of (A) the
 
 
 -7-
 
 

 
 
 Executive's Base Salary in effect immediately prior to the change in
 control, plus (B) the greater of (i) the average of the Executive's actual
 bonus attributable to each of the preceding three (3) fiscal years or (ii)
 the Executive's target bonus amount for the fiscal year in which the
 termination occurs multiplied by the average percentage bonus attainment of
 the Executive over the preceding three (3) fiscal years.
 
 b. The Company shall (i) pay premiums on behalf of the Executive, for
 coverage substantially similar to that provided under the Company's health,
 disability and group term life insurance plans, for so long as the
 Executive elects to continue such coverage, and (ii) continue to pay the
 Company's matching portion of the Executive's Non-Qualified Deferred
 Compensation Plan (or such retirement arrangement, if any, as may replace
 it), in both cases for up to a maximum of 24 months.
 
 c. The immediate vesting of any unvested stock options, stock
 appreciation rights, and other equity-based awards held by the Executive as
 of the day immediately preceding the effective date of termination and,
 with respect to all Restricted Share awards, all restrictions will
 immediately be removed and deemed to have been satisfied and any vesting
 periods will be accelerated, and, if such payment was earned by the
 Executive at the effective time of the termination, the accelerated payment
 of the Company's FlexPerks benefit for the year in which the termination
 occurs.
 
 d. Participation by the Executive in all compensation and benefit
 plans of the Company will cease upon the effective date of termination and
 all unvested bonuses, equity awards and other like items will immediately
 lapse, except as specifically provided in subsection (c), above. In
 addition, all amounts owed by the Executive to the Company for any reasons
 whatsoever will become immediately due and payable and the Company will
 have the right in its discretion to collect any or all such amounts by
 offset against any amounts due to the Executive from the Company whether or
 not under this Agreement.
 
 e. The Executive shall be bound by the non-competition provisions of
 Section 10, which shall remain in full force and effect for a period of 24
 months following the effective date of Executive's termination.
 
 f. In the event of a Change in Control, if the total amount payable by
 the Company to the Executive pursuant to this Section 14 (the "Section 14
 Amount") would create an excess parachute payment, as that term is defined
 in Section 280G of the Internal Revenue Code (the "Code"), then, the
 Executive shall be paid either (i) the Section 14 Amount, or (ii) the
 Section 14 Amount reduced to an amount equal to one-dollar ($1) less than
 the maximum amount allowed under the Code, whichever amount results in the
 greater after-tax payment to the Executive.
 
 15. Definitions of Change in Control. "Change in Control" means change in
control as defined by Code Section 409A and as permitted under Code Section 409A
and the regulations and guidance promulgated thereunder.
 
 
 -8-
 
 

 
 
 16. Arbitration of Disputes.
 
 a. Any dispute or claim arising out of or relating to this Agreement
 or any termination of the Executive's employment, other than with respect
 to Sections 8 through 12, shall be settled by final and binding arbitration
 in the greater Kansas City metropolitan area in accordance with the
 Commercial Arbitration rules of the American Arbitration Association, and
 judgment upon the award rendered by the arbitrators may be entered in any
 court having jurisdiction thereof.
 
 b. In the event that the Company does not submit to arbitration
 hereunder or submits to arbitration but seeks to nullify or reverse the
 effect of such arbitration by alleging that arbitration is unenforceable
 against it, the Company shall pay all costs (including expenses and
 attorneys' fees) incurred by the Executive as a result of such action by
 the Company and if the Company is successful in such attempt, it shall bear
 all legal costs incurred by the Executive in any resulting litigation
 relating to this Agreement or any termination of the Executive's
 employment.
 
 c. The fees and expenses of the arbitration panel shall be borne by
 the Company.
 
 d. If the Company breaches its obligations hereunder and the Executive
 is successful in a claim brought by him in arbitration for damages or other
 relief against the Company related to such breach, the Executive shall be
 entitled to an award of his costs (including expenses and attorneys' fees),
 incurred in such arbitration.
 
 17. Mitigation. The Executive shall have no duty to attempt to mitigate the
level of benefits payable by the Company to him hereunder and the Company shall
not be entitled to set off against the amounts payable hereunder any amounts
received by the Executive from any other source, including any subsequent
employer.
 
 18. Notices. Any notices to be given hereunder by either party to the other
may be effected either by personal delivery in writing or by mail, registered or
certified, postage prepaid, with return receipt requested. Mailed notices shall
be addressed as follows:
 
 a. If to the Company:
 
 Applebee's International, Inc.
 4551 West 107th Street, Suite 100
 Overland Park, Kansas 66207
 Attn: General Counsel
 
 b. If to the Executive:
 
 David L. Goebel
 9707 Sunset Circle
 Lenexa, KS 66220
 
 
 -9-
 
 

 
 
Either party may change its address for notice by giving notice in accordance
with the terms of this Section 18.
 
 19. General Provisions.
 
 a. Law Governing. This Agreement shall be governed by and construed in
 accordance with the laws of the State of Kansas.
 
 b. Invalid Provisions. If any provision of this Agreement is held to
 be illegal, invalid, or unenforceable, then such provision shall be fully
 severable and this Agreement shall be construed and enforced as if such
 illegal, invalid, or unenforceable provision had never comprised a part
 hereof; and the remaining provisions hereof shall remain in full force and
 effect and shall not be affected by the illegal, invalid, or unenforceable
 provision or by its severance herefrom. Furthermore, in lieu of such
 illegal, invalid, or unenforceable provision there shall be added
 automatically as a part of this Agreement a provision as similar in terms
 to such illegal, invalid, or unenforceable provision as may be possible and
 still be legal, valid or enforceable.
 
 c. Entire Agreement. This Agreement sets forth the entire
 understanding of the parties and supersedes all prior agreements or
 understandings, whether written or oral, with respect to the subject matter
 hereof other than the Indemnification Agreement executed between the
 Company and the Executive on June 17, 2004, and the Change in Control and
 Noncompete Agreement executed between the Company and the Executive on June
 16, 2004, and all agreements, acknowledgments, designations and directions
 of the Executive made or given under any Company policy statement or
 benefit program. No terms, conditions, warranties, other than those
 contained herein, and no amendments or modifications hereto shall be
 binding unless made in writing and signed by the parties hereto.
 
 d. Binding Effect. This Agreement shall extend to and be binding upon
 and inure to the benefit to the parties hereto, their respective heirs,
 representatives, successors and assigns. This Agreement may not be assigned
 by the Executive, but may be assigned by the Company to any person or
 entity that succeeds to the ownership or operation of the business in which
 the Executive is primarily employed by the Company.
 
 e. Waiver. The waiver by either party hereto of a breach of any term
 or provision of this Agreement shall not operate or be construed as a
 waiver of a subsequent breach of the same provision by any party or of the
 breach of any other term or provision of this Agreement.
 
 f. Titles. Titles of the paragraphs herein are used solely for
 convenience and shall not be used for interpretation or construing any
 work, clause, paragraph, or provision of this Agreement.
 
 g. Counterparts. This Agreement may be executed in two or more
 counterparts, each of which shall be deemed an original, but which together
 shall constitute one and the same instrument.
 
 
 -10-
 
 

 
 
 h. Compliance with IRC Section 409A. (i) Notwithstanding anything to
 the contrary in this Agreement, payments due to "separation from service"
 (within the meaning of Internal Revenue Code ("Code") Section
 409A(a)(2)(A)(i)) may not be made before the date which is six months after
 the date of separation from service, if either the separation from service,
 or the date that payments attributable to such separation from service,
 occurs during a "Delay Year" during which Executive is a "Specified
 Employee" (a "Six Month Delay"). A "Specified Employee" shall mean, for any
 Delay Year, any individual who during the calendar year that ended
 immediately before the beginning of the Delay Year, was an officer of the
 Company or an Affiliated Company whose compensation was for such calendar
 year greater than the amount described in Code Section 416(i)(1)(A)(i)
 ($135,000 for 2005), or any other person who was a "key employee" during
 such calendar year within the meaning of Code Section 416(i)(1)(A). This
 determination shall take into account all provisions of Code section
 416)(i) other than 416(i)(5), including the limitation on the number of
 officers to be counted. "Delay Year" means the twelve month period
 beginning each April 1. In the event of a Six Month Delay, the amounts that
 would have been paid pursuant to this Agreement during such delay if the
 delay had not been imposed, shall be paid in a lump sum as soon as is
 administratively practicable following the expiration of the Six Month
 Delay and any other amounts to be paid pursuant to this Agreement after the
 end of the Six Month Delay shall be paid in accordance with the terms of
 this Agreement. "Affiliated Company" means any corporation which is a
 participant of a controlled group of corporations (as defined in Section
 414(b) of the Code) which includes the Company; any trade or business
 (whether or not incorporated) which is under common control (as defined in
 Section 414(c) of the Code) with the Company; any organization (whether or
 not incorporated) which is a member of an affiliated service group (as
 defined in Section 414(m) of the Code) which includes the Company; and any
 other entity required to be aggregated with the Company pursuant to
 regulations under Section 414(o) of the Code. An entity shall be considered
 an Affiliated Company only during the period it meets one of the foregoing
 criteria.
 
 (ii) In the event payments are delayed for six months or more pursuant
 to subparagraph (i), above, then the Company will, at the time the first
 payment is made, also pay to the Executive an amount equal to the interest
 the Executive would have earned on any delayed payment from the date such
 payment would have been made under this Agreement through the date of such
 first payment at an interest rate equal to the rate interest that the
 Company paid on its indebtedness during such period of delay.
 
 (iii) While the Company has no discretion regarding a delay in
 payments pursuant to subparagraph (i), above, in the event such payments
 should have been delayed but were not due to the negligent or willful act
 of the Company, then the Company shall pay to the Executive any additional
 tax due to the IRS from the Executive within 30 days after the Executive's
 payment of the additional tax to the IRS.
 
 
 -11-
 
 

 
 
 IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the date and year first above written.
 
 THIS AGREEMENT CONTAINS AN ARBITRATION CLAUSE.
 
 
EXECUTIVE: APPLEBEE'S INTERNATIONAL, INC.
 
 
 
/s/ David L. Goebel By: /s/ Lloyd L. Hill
-------------------------------- --------------------------------------
DAVID L. GOEBEL LLOYD L. HILL
 
 
 By: /s/ Stanley M. Sword
 --------------------------------------
 STANLEY M. SWORD
 
 
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 Dave Goebel Employment Agreement
 Exhibit A - Duties and Responsibilities
 
 
1. The Executive is accountable for the Company's financial success and the
 creation of shareholder value.
 
  Provides leadership and vision in developing corporate strategy and is
 accountable to the Board for the successful implementation of the
 strategy.
 
  Creates shareholder value through the development and implementation
 of annual and long-term business plans that are consistent with
 corporate strategy.
 
  Provides leadership in developing annual sales, profit and asset
 utilization plans and is accountable to the Board for financial
 performance.
 
  Certifies and signs off on all quarterly financial statements and
 filings ensuring compliance with all provisions of the Sarbanes-Oxley
 Act, if required.
 
2. The Executive is accountable for the continual development of a
 performance-driven culture.
 
  Maintains a positive and ethical work climate that is conducive to
 attracting and motivating a diverse group of top quality associates at
 all levels.
 
  Fosters a corporate culture that promotes ethical practices,
 encourages individual integrity and fulfills social responsibility.
 
  Ensures that direct subordinates understand their performance
 expectations and that there exists a high degree of clarity, focus,
 and alignment throughout the organization regarding goals and
 objectives.
 
3. The Executive is accountable for creating a team of highly focused senior
 executives and ensures appropriate management development throughout the
 organization.
 
  Provides coaching and direction to senior executive team and evaluates
 their performance and provides appropriate feedback.
 
  Ensures continuity of executive and management talent by directing
 development and succession programs.
 
  Provides sponsorship to the development and implementation of
 leadership development throughout the organization.
 
 
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4. The Executive serves as a spokesperson for the Company to its various
 internal and external constituents.
 
  Represents the Company to its associates and franchisees.
 
  Presents the Company strategy and business plans at its annual
 shareholders meeting.
 
  Develops appropriate relationships with, and presents Company plans
 to, key shareholders, financial analysts and other interested parties.
 
5. Serves as a member of the Board of Directors and in that capacity
 contributes to the Board's discharge of its duties.
 
  In collaboration with the Chairman, with input from other Board
 members and Committee Chairs, develops the agenda for regularly
 scheduled and special Board meetings.
 
  Shares with the Board, the Company's overall vision, strategy and
 direction on an annual basis.
 
  On an annual basis, oversees the preparation of and presents operating
 plans and budgets to the Board.
 
  Provides the Board with timely, accurate and reliable financial
 information that allows the Board to fully understand the Company's
 performance.
 
These responsibilities result in a Hay point allocation of 4296 as of January,
2006. These responsibilities may be increased or decreased by the Company from
time to time, subject always to the Executive's rights under Section 13.f.
above.
 
 
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