OVERLAND PARK Kan. The merger agreement between Applebee’s International Inc. and its pending acquirer, IHOP Corp., calls for Applebee’s to pay IHOP $60 million should it back out of the deal, according to a Wednesday night filing with the Securities & Exchange Commission.
The pending $2.1 billion transaction, in which IHOP would purchase Applebee’s for $25.50 per share, is subject to approval by Applebee’s shareholders, customary closing conditions and regulatory authorizations. A date for a shareholder vote is not yet set.
According to the merger agreement, “under certain circumstances” Applebee’s could be required to pay IHOP a termination fee of $60 million. Both companies have said they expect the deal to close in the fourth quarter of this year. IHOP, parent of the mostly franchised, 1,319-unit family dining chain, is based in Glendale, Calif. Applebee’s, based here, operates or franchises a chain of 1,943 casual-dining locations.