SECOND AMENDMENT TO PARTICIPATION AGREEMENT

     THIS SECOND AMENDMENT TO  PARTICIPATION  AGREEMENT (this  "Amendment"),  is
entered into as of August 14, 1998,  among (i) APPLE SOUTH,  INC., a corporation
organized  and existing  under the laws of Georgia  (herein,  together  with its
successors and assigns  permitted  hereunder,  called the "Lessee"),  (ii) FIRST
SECURITY BANK,  NATIONAL  ASSOCIATION,  a national banking  association  ("First
Security"),  not in its individual capacity except as expressly provided herein,
but solely as Owner  Trustee  under Apple  South Trust No. 97-1  (herein in such
capacity,  together with its successors and assigns permitted hereunder,  called
the "Owner Trustee"),  (iii) STI CREDIT CORPORATION,  a Nevada  corporation,  as
assignee  of  SunTrust  Bank,  Atlanta,  in its  capacity  as the  holder of the
beneficial  interest in the trust estate established under Apple South Trust No.
97-1 (in such capacity as of the date hereof,  the  "Holder",  and together with
its successors and assigns permitted hereunder,  called the "Holders"), (iv) the
financial  institutions now parties to the  Participation  Agreement (as defined
below) as Lenders (each herein in such  capacity,  together with its  successors
and  assigns  permitted  hereunder,  called a  "Lender"  and  collectively,  the
"Lenders"),  and (v) SUNTRUST BANK, ATLANTA, a banking corporation organized and
existing  under  the laws of  Georgia,  ("SunTrust"),  as  collateral  agent and
administrative  agent for the Lenders and the  Holders  (in such  capacity,  the
"Administrative Agent").

                               W I T N E S S E T H

     WHEREAS,  the Lessee,  the Owner Trustee,  the Holder,  the Lenders and the
Administrative Agent are parties to that certain Participation Agreement,  dated
as of September 24, 1997, as amended by the First Amendment to the Participation
Agreement,  dated  as of  March  27,  1998 (as so  amended,  the  "Participation
Agreement");

     WHEREAS,  the Lessee,  the Owner Trustee,  the Holder,  the Lenders and the
Administrative Agent have agreed to amend the Participation Agreement in certain
respects, as described more particularly below;

     NOW,  THEREFORE,  in consideration of the sum of TEN DOLLARS ($10.00),  the
foregoing  premises,  to  induce  the  Holder  and  the  Lenders  to  amend  the
Participation Agreement and to continue to perform their obligations thereunder,
and for other good and valuable  consideration,  the  sufficiency and receipt of
all of which are acknowledged,  the Lessee,  the Owner Trustee,  the Holder, the
Lenders and the Administrative Agent agree as follows:

                                 A. DEFINITIONS

     Unless the context  otherwise  requires,  all capitalized terms used herein
and not otherwise defined herein shall have the meanings set forth in Appendix A
to the Participation  Agreement for all purposes of this Amendment.  The General
Provisions of Appendix A to the Participation  Agreement are hereby incorporated
by reference herein.

                                  B. AMENDMENTS

     1.  Section  5.11 of the  Participation  Agreement  is amended by  deleting
clause (g) thereof in its entirety and  substituting  in its place the following
revised clause (g):

     (g)  Subsidiaries.  Make  investments in  Consolidated  Subsidiaries of the
Lessee in the ordinary  course of, and pursuant to the  reasonable  requirements
of, the Lessee's and such Subsidiaries' respective businesses, provided that the
aggregate  amount of such  investments  which may be outstanding at any one time
hereafter,  as to all such  Subsidiaries,  other  than any which are  Subsidiary
Guarantors  (as to which no  limitation  shall  apply),  shall not  exceed  five
percent  (5%) of  consolidated  total  assets  of  Lessee  and its  Consolidated
Subsidiaries;  it being  understood  and agreed that (a) there shall be excluded


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from  such  calculation  any  investment  deemed  made  by the  Lessee  in  DF&R
Restaurants,  Inc., a Texas  corporation  which is a wholly-owned,  Consolidated
Subsidiary of the Lessee,  pursuant to the accounting for the prior  acquisition
of such corporation by the Lessee as a pooling of interests;  (b) there shall be
deducted in any event from the amount of investments in  Subsidiaries  which may
be made pursuant to this clause (g) the aggregate  amount of  Capitalized  Lease
Obligations of all Subsidiaries which are at any time outstanding, if and to the
extent not already counted against such amount as an investment of Lessee; i.e.,
as a Capitalized  Lease Obligation  owing to Lessee as lessor or sublessor;  and
(c) the provisions of this clause (g) shall be the exclusive  means by which the
Lessee (or any Subsidiary) may make investments in any Subsidiaries  (whether or
not wholly-owned  Subsidiaries)  and shall override any other provisions of this
Section 5.11 (including, particularly, clauses (j), (k) and (l) below) which may
be construed otherwise to permit such investments.

     2. Section 5.19 of the Participation Agreement is amended by adding thereto
immediately  after the words "any of the  following" and before the colon in the
fourth line thereof, these words:

     , unless such  Subsidiary has executed and delivered to the  Administrative
Agent a Subsidiary Guaranty and all related documents required by Section 5.27

such that Section 5.19, as so amended, shall read in its entirety as follows:

     SECTION 5.19. Subsidiary Debt.

     Except to the extent  expressly  permitted  in clause(g) of Section 5.11 of
this Agreement,  the Lessee will not permit any  Consolidated  Subsidiary of the
Lessee  which is a wholly  owned  Subsidiary,  directly  or  indirectly,  of the
Lessee,  to create,  incur or suffer to exist any of the following,  unless such
Subsidiary has executed and delivered to the  Administrative  Agent a Subsidiary
Guaranty and all other Subsidiary  Guaranty  Documents required by Section 5.27:
(i)  indebtedness  for  borrowed  funds;  (ii)  Capitalized  Lease  Obligations,
provided,  however,  that DF&R Restaurants,  Inc. and its Subsidiaries may incur
Capitalized Lease  Obligations in an aggregate amount not to exceed  $10,000,000
at any one time  outstanding;  (iii)  Guarantees;  (iv)  debts,  liabilities  or
obligations  to any  seller  incurred  to pay the  deferred  purchase  price  of
property or services  having a deferred  purchase  price of  $1,000,000 or more,
excepting,  in any event,  trade accounts payable arising in the ordinary course
of  business  and  purchase  options  prior to their  exercise;  and (v)  debts,
liabilities or obligations in respect of Synthetic Leases.

     3. The  Participation  Agreement is further amended by adding the following
as a new Section 5.27 thereto:

     SECTION 5.27 Subsidiary Guaranties.

     Effective  as of August 14,  1998,  Lessee  shall  cause each  Consolidated
Subsidiary  of the  Lessee  which  is a wholly  owned  Subsidiary,  directly  or
indirectly,  of Lessee  then  existing  or  thereafter  acquired  or coming into
existence (excepting therefrom any having total assets of less than Ten Thousand
Dollars  ($10,000))  to execute a Subsidiary  Guaranty,  together with all other
such  documents  which  the  Administrative  Agent  may  reasonably  request  in
connection  therewith,  including  a  secretary's  certificate,  confirming  the
existence of enabling  authorization in respect of such Subsidiary Guarantor and
signing  officer  incumbency,  and an opinion of counsel,  confirming  that such
Subsidiary  Guaranty  is a valid,  binding  and  enforceable  obligation  of the
Subsidiary  party  thereto,  subject to customary  assumptions,  exceptions  and
limitations  acceptable to  Administrative  Agent (herein called,  collectively,
together with the Subsidiary  Guaranties,  the "Subsidiary Guaranty Documents").
As to all such  Subsidiaries in existence on August 14, 1998, Lessee shall cause
all such Subsidiary  Guaranty Documents in respect thereof to have been executed
and delivered as soon as practicable  but in any event by August 14, 1998. As to
all such Subsidiaries acquired or coming into existence subsequent to August 14,
1998,  Lessee  shall cause all such  Subsidiary  Guaranty  Documents  in respect


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thereof to have been executed and delivered as soon as practicable after, but in
any event within thirty (30) days after, its acquisition or creation.

     4.  Appendix  A of the  Participation  Agreement  is  amended by adding the
following definitions to Appendix A in proper alphabetical order:

     "Subsidiary  Guarantor"  shall mean any  wholly-owned  Subsidiary of Lessee
which has executed a Subsidiary Guaranty pursuant to Section 5.27.

     "Subsidiary  Guaranty" shall mean a guaranty,  in substantially the form of
Exhibit A attached hereto, pursuant to which a wholly-owned Subsidiary of Lessee
shall guarantee all debts,  liabilities and obligations of the Lessee hereunder,
all in accordance with Section 5.27.

                                C. MISCELLANEOUS

     1. Upon the Administrative Agent's receipt of executed signature pages from
all parties to this  Amendment,  all amendments to the  Participation  Agreement
made herein shall become  effective  as of August 14, 1998;  provided,  however,
that the following shall have been executed and delivered to the  Administrative
Agent on or before such date,  in form and substance  satisfactory  to the Owner
Trustee,  the Holder,  the Lenders and the Administrative  Agent,  to-wit: (i) a
Secretary's (or Assistant  Secretary's)  Certificate  for the Lessee;  (ii) this
Amendment;  (iii) Subsidiary  Guaranties and corresponding  Subsidiary  Guaranty
Documents for each  wholly-owned  Subsidiary  of Lessee  existing on the date of
this Amendment.

     2. Except as expressly set forth herein, this Amendment shall be deemed not
to waive or modify any  provision  of the  Participation  Agreement or the other
Operative Agreements,  and all terms of the Participation  Agreement, as amended
hereby,  shall be and shall remain in full force and effect and shall constitute
a legal,  valid,  binding and enforceable  obligations of the Lessee,  the Owner
Trustee, the Holder, the Lenders and the Administrative Agent. All references to
the Participation Agreement shall hereinafter be references to the Participation
Agreement as amended by this  Amendment.  To the extent any terms and conditions
in any of the Operative  Agreements  shall contradict or be in conflict with any
terms or conditions of the Participation Agreement,  after giving effect to this
Amendment,  such terms and  conditions  are hereby  deemed  modified and amended
accordingly to reflect the terms and conditions of the  Participation  Agreement
as modified  and amended  hereby.  It is not  intended by the parties  that this
Amendment  constitute,  and this Amendment shall not  constitute,  a novation or
accord and satisfaction.

     3.  To  induce  the  Owner  Trustee,   the  Holder,  the  Lenders  and  the
Administrative Agent to enter into this Amendment (A) Lessee hereby restates and
renews each and every  representation and warranty  heretofore made by it under,
or in  connection  with,  the  execution  and  delivery  of,  the  Participation
Agreement;  (B) Lessee hereby  restates,  ratifies and reaffirms  each and every
term and condition set forth in the Participation  Agreement, as amended hereby,
and in  the  Operative  Agreements  as  amended  hereby,  and  in the  Operative
Agreements,  effective as of the date hereof;  and (C) Lessee  hereby  certifies
that no Lease Event of Default has occurred and is continuing.

     4. THIS AMENDMENT  SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE  WITH,
THE LAWS OF THE STATE OF GEORGIA AND ALL APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA.

     5. This  Amendment  may be  executed in one or more  counterparts,  each of
which shall be deemed an original,  but all of which together  shall  constitute
one and the same document.

     6. This  Amendment  shall be binding on, and shall inure to the benefit of,
the successors and assigns of the parties hereto.

     7. In the  event  that  any  part of this  Agreement  shall  be found to be


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illegal or in violation of public  policy,  or for any reason  unenforceable  at
law, such finding shall not invalidate any other part thereof.

     8. TIME IS OF THE ESSENCE UNDER THIS AGREEMENT.

     9. The parties agree that their  signatures by telecopy or facsimile  shall
be effective  and binding upon them as though  executed in ink on paper but that
the parties shall exchange original ink signatures  promptly  following any such
delivery by telecopy or facsimile.

     10.  Lessee  agrees to pay all costs and expenses of  Administrative  Agent
incurred in connection with the preparation, execution, delivery and enforcement
of this  Amendment  and all other  Operative  Agreements  executed in connection
herewith,   including  the  reasonable  fees  and   out-of-pocket   expenses  of
Administrative Agent's counsel.

     11. This Amendment shall constitute a Operative  Agreement for all purposes
of the Participation Agreement and shall be governed accordingly.












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     IN WITNESS WHEREOF,  the Lessee, the Owner Trustee, the Holder, each Lender
and the  Administrative  Agent have set their hands as of the day and year first
above written.

                              "LESSEE"

                              APPLE SOUTH, INC.

                              By:_________________________________
                                 Erich J. Booth, Chief Financial
                                 Officer and Treasurer

                              Attest:_____________________________
                                     Tonya Benjamin, Assistant Secretary


                              "OWNER TRUSTEE"

                              FIRST SECURITY BANK, N.A.

                              By:_________________________________
                              Name:____________________________
                              Title:_____________________________


                              "HOLDER"

                              STI CREDIT CORPORATION

                              By:_________________________________
                              Name:____________________________
                              Title:_____________________________


                              "LENDERS"

                              SUNTRUST BANK, ATLANTA, as the Administrative 
                              Agent and as a Lender

                              By:_________________________________
                              Name:____________________________
                              Title:_____________________________

                              By:_________________________________
                              Name:____________________________
                              Title:_____________________________


                              BANCBOSTON LEASING, INC.

                              By:_________________________________
                              Name:____________________________
                              Title:_____________________________


                              SOUTHTRUST BANK, N.A.

                              By:_________________________________
                              Name:____________________________
                              Title:________________


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