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IHOP Corp. To Acquire Applebee's International, Inc. For $25.50 Per Share In All-Cash Transaction

Combination Brings Together Two Leading Restaurant Brands and Creates Significant Opportunities to Generate Shareholder Value

Glendale, Calif. and Overland Park, Kan., July 16, 2007 – IHOP Corp. (NYSE: IHP) and Applebee's International, Inc. (NASDAQ: APPB), today jointly announced a definitive agreement under which IHOP Corp. ("IHOP") will acquire Applebee's International, Inc. ("Applebee's") for $25.50 per share in cash, representing a total transaction value of approximately $2.1 billion. Over the last five years, IHOP has successfully re-energized its nearly 50-year old brand while transforming itself into a pure-play franchisor with more than 99% of its 1,319 restaurant system owned and operated by franchisees. IHOP believes that it can employ similar strategies to transform and re-energize Applebee's. IHOP intends to franchise a substantial majority of Applebee's 508 company-operated restaurants and expects to realize significant cost savings as a result. Additionally, management will focus on driving marketing and operational improvements aimed at re-energizing Applebee's system performance. These changes are expected to result in significant and increasing cash flow over time, which will be used to initially reduce debt incurred in connection with the acquisition. Once debt levels are reduced, IHOP intends to return to its long-term commitment of returning cash to its shareholders through share repurchases. At present, IHOP expects to continue quarterly dividend payments at the discretion of its Board of Directors.

IHOP Chairman and Chief Executive Officer Julia Stewart, who will lead the management team of the combined Company, said, "Over the past year and a half, we have been evaluating alternatives that would allow us to leverage IHOP's proven competencies in order to create additional long-term value for shareholders, including a potential acquisition. Applebee's meets all of our acquisition criteria and we expect the combination to generate significant additional value for our shareholders." Added Ms. Stewart, "We look forward to applying the same focus and discipline to Applebee's that we have employed at IHOP over the last several years. We have successfully restructured our own company, and in the process, re-energized our brand, improved our operational performance and maximized the development of franchise restaurants."

"This transaction represents the culmination of a comprehensive strategic alternatives process led by the Strategy Committee of our Board of Directors to identify the best alternative to create value for Applebee's shareholders," said Dave Goebel, President and Chief Executive Officer of Applebee's International. "We believe the combined Company, and the strength of the two brands, will drive significant value creation. Our management team looks forward to working with the IHOP management team during the transition period."

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