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12 Oct 2006

Activist Hedge Fund reports 5% Ownership of Applebees

Breeden Capital Management LLC, the activist hedge fund of former Securities and Exchange Commission Chairman Richard Breeden, reported that it owns 3.9 million shares, or 5.24% of Applebee’s International Inc.’s common stock.

In a filing with the Securities and Exchange Commission, Breeden Capital said that it had bought the shares due to their undervalued price listings, not to retain control. The purchase price for the shares was $77.7 million.

Breeden Capital said it had spoken with Applebee’s CEO Dave Goebel and recommended to Applebee’s CEO Dave Goebel, that the company should refranchise and modify executive compensation practices to increase shareholder value.

Between Sept. 18 and Sept. 29, Breeden Capital bought about 740,000 shares of Applebee’s stock for about $22 a share, or a total of $16.3 million, the filing said.

Breeden Capital Management is registered as an investment adviser to Breeden Partners LP as well as Breeden Partners Ltd., a private fund organized as an exempted company under the laws of the Cayman Islands, according to filings with the SEC.

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