SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended January 3, 1999            Commission File No. 0-19542


                               AVADO BRANDS, INC.
             (Exact name of registrant as specified in its charter)

        Georgia                                         59-2778983
(State of Incorporation)                    (I.R.S. Employer Identification No.)

       Hancock at Washington
         Madison, Georgia                                               30650
(Address of Principal Executive Offices)                              (Zip Code)

       Registrant's telephone number, including area code: (706) 342-4552

               Securities registered pursuant to Section 12(b) of
                                    the Act:

                                      None

           Securities registered pursuant to Section 12(g) of the Act:

                     Common Stock, par value $0.01 per share
                                (Title of Class)

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. YES X NO_____

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's  knowledge,  in the definitive proxy statement incorporated
by reference  in Part III of this Form 10-K or any  amendment to this Form 10-K.
[X] 

             ------------------------------------------------------

     As of March 30 , 1999,  the  aggregate  market value of the common stock of
the registrant held by  non-affiliates  of the registrant,  as determined by the
last sales price, was $134,773,000.

     As of March 30, 1999, the number of shares of common stock  outstanding was
29,068,586.

                      DOCUMENTS INCORPORATED BY REFERENCE:

     (1) Annual Report to Shareholders for the fiscal year ended January 3, 1999
(Part II of Form 10-K).

     (2) Definitive  Proxy  Statement for use in connection with the 1999 Annual
Meeting of Shareholders (Part III of Form 10-K).

<PAGE>
                                     PART I
Item 1.  Business

General

     Avado Brands, Inc. (formerly Apple South, Inc.), including its wholly owned
subsidiaries  (the "Company" or "Avado Brands"),  is a multi-concept  restaurant
company  owning and  operating  restaurants  in 29 states  plus the  District of
Columbia.   Since  its  inception  in  1986,   the  Company  has  increased  its
profitability and size through the efficient management of restaurant operations
and  through  a  series  of  strategic  restaurant  openings,  acquisitions  and
divestitures.  At January 3, 1999, the Company  operated 123 Don Pablo's Mexican
Kitchen restaurants,  47 Hops Restaurant Bar & Brewery restaurants, 23 McCormick
& Schmick's  seafood  dinner  houses,  19 Canyon Cafe  restaurants as well as 44
Applebee's  Neighborhood  Grill & Bar restaurants  which were held for sale. All
brands are owned on a proprietary basis except Applebee's,  which is franchised.
For the year ended January 3, 1999,  total restaurant sales were $862.7 million.
Avado  Brands  also owns a  20-percent  equity  interest  in Belgo  Group PLC, a
ten-unit United Kingdom restaurant company,  and a 25-percent equity interest in
11 Harrigans Grill and Bar restaurants.

     In November 1995, 44 Don Pablo's  restaurants and 12 Harrigans  restaurants
were acquired through a pooling of interests  transaction with DF&R Restaurants,
Inc.  During 1997,  three purchase  business  combinations  were completed which
included  the  acquisition  of 16  McCormick  & Schmick's  restaurants,  21 Hops
restaurants and 13 Canyon Cafe restaurants.  Also in 1997, the Company announced
its decision to sell its franchised Applebee's  restaurants in order to focus on
the continued  development of its higher margin,  better return,  greater growth
proprietary concepts.  During 1998, the divestiture was substantially  completed
with  the  sale  of 233 of 279  Applebee's  locations  and  the  closing  of two
additional  locations.  Gross proceeds from the sale transactions totaled $434.8
million including $6.8 million in notes and other amounts due. Also during 1998,
the Company divested its Harrigans restaurants, retaining a 25-percent ownership
in the  ongoing  business,  and  acquired a  20-percent  interest  in Belgo.  In
addition,  the Company and Belgo have established two, 50/50 joint ventures: one
for the  initial  development  of one of the  Company's  proprietary  brands  in
Europe,  probably  McCormick & Schmick's,  and the other for the  development of
Belgo restaurants in the Western Hemisphere. In January of 1999, the first Belgo
restaurant  in the United  States was opened in New York City.  In  February  of
1999, the Company announced the establishment of a new, 50/50 joint venture with
London-based  PizzaExpress PLC for the North American development of the upscale
PizzaExpress brand. The joint venture's first U.S. restaurant opened in March of
1999 in Philadelphia under the name San Marzano.

     The Company's strategy includes the acquisition, development, operation and
growth  of  niche-leading  restaurant  brands  within  a  unique  organizational
structure that rewards entrepreneurial decision-making.  Each brand functions on
a  decentralized   basis  with  its  own  executive   management,   real  estate
development,   purchasing,  recruiting,  training,  marketing,  accounting,  and
restaurant  operations.  This consumer-based  operating  philosophy allows Avado
Brands to gain competitive  advantage by sharing best practices and centralizing
non-brand  critical  processes such as human  resources,  finance,  treasury and
capital formation. During 1999, a total of 40 restaurants, including 20 Hops, 15
Don Pablo's,  four McCormick & Schmick's and one Canyon Cafe, are expected to be
opened.

     On October 13, 1998,  the Company  changed its  corporate  name from "Apple
South,  Inc." to "Avado  Brands,  Inc." The name  change was made to reflect the
evolution of the nature and character of the business, including the divestiture
of the Company's  Applebee's brand, and the emphasis on a multi-brand  strategy.
In connection  with the corporate  name change,  the Company  changed the Nasdaq
National Market trading symbol of its common stock from "APSO" to "AVDO."



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Avado Brands' Restaurant Concepts

                                   Don Pablo's

     The first Don Pablo's was opened in Lubbock, Texas in 1985. The restaurants
feature  traditional  Mexican  dishes served in a  distinctive,  festive  dining
atmosphere  reminiscent of a Mexican  village plaza.  Each restaurant is staffed
with a highly experienced management team that is visible in the dining area and
interacts with both customers and the staff to ensure attentive customer service
and consistent food quality. Items are prepared fresh on-site using high-quality
ingredients at relatively low prices.  The diverse menu,  generous  portions and
attractive price/value relationship appeal to a broad customer base.

     Menu. The menu offers a wide variety of entrees,  including  enchiladas and
tacos served with various sauces and homemade salsa plus mesquite-grilled  items
such as fajitas,  carne asada and chicken. The menu also includes tortilla soup,
a selection of salads,  Mexican-style  appetizers such as quesadillas and unique
desserts.  During 1998,  the cost of a typical meal,  including  beverages,  was
$8.00 to $9.50 for lunch and $9.50 to $11.50  for  dinner.  In  addition  to its
regular menu, Don Pablo's  offers 15 lunch  specials  priced from $4.49 to $7.19
each and a lower- priced  children's  menu.  Full bar service is also  provided.
Alcoholic beverage sales accounted for approximately 19% of sales in 1998.

     Restaurant  Layout.  Distinctive  Mexican  architecture  and interior decor
provide a casual, fun dining atmosphere.  The restaurants have an open, spacious
feel, created with the use of sky-lights and a Mexican village plaza design, and
are  enhanced by an indoor  fountain and the use of stucco,  brick and tile,  as
well as plants, signs and art work. Homemade tortillas cooked in the dining area
underscore  the  commitment  to  fresh,  authentic  Mexican  food.  Both one and
two-story building designs are utilized. The two-story design features a balcony
which  provides  seating  for bar  patrons  and dining  customers  waiting to be
seated.  The one-story design  incorporates a smaller bar adjacent to the dining
area.  Both  designs  use high  ceiling  architecture  and have  similar  dining
capacities.  Restaurants  range in size from 6,000  square feet to 9,900  square
feet, with the average restaurant  containing  approximately  8,000 square feet.
The  restaurants  generally  have dining  room  seating  for  approximately  230
customers and bar seating for approximately 70 additional customers.

     Unit  Economics.  In 1998, the average cost of developing and opening a Don
Pablo's  restaurant  was  approximately  $1.7 million,  excluding land costs and
preopening  expenses.  The  cost of  land  for  these  restaurants  ranged  from
approximately  $600,000  to  $1,275,000;   preopening  expenses,  which  consist
primarily of wages and  salaries,  hourly  employee  recruiting,  license  fees,
meals,  lodging and travel plus the cost of hiring and training  the  management
teams, averaged $185,000.

     Field Management. Management is shared by 36 district and area managers who
report to two Regional Vice  Presidents of  Operations.  The strategy is to have
each  area  manager  responsible  for a  limited  number  of  restaurants,  thus
facilitating  a focus on  quality  of  operations  and unit  profitability.  The
management staff of a typical  restaurant  consists of one general manager,  one
kitchen  manager and three  assistant  managers.  General  managers  and kitchen
managers  are  eligible  to  receive  bonuses  equal  to a  percentage  of their
restaurant's sales, subject to operating within budgeted costs.

     Advertising and Marketing.  Don Pablo's  advertising and marketing strategy
combines  the use of  television  and radio  advertising  in core markets with a
focus on local  efforts and community  involvement  at all  locations.  In 1998,
advertising  contributed to a 1% increase in annual sales for those  restaurants
open for all of 1997 and 1998 as well as benefitting  new  restaurant  openings.
Current  strategies  are  expected  to continue in 1999 with a focus on efforts,
such as Manager's  Specials and other  promotions,  designed to increase traffic
counts and check average. 

                         Hops Restaurant Bar & Brewery

     The first Hops was opened in Clearwater,  Florida in 1989.  Each restaurant
offers a diverse menu of popular foods,  freshly  prepared in a display  kitchen
with a strict commitment to quality and value. Additionally, each



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restaurant features an on-premises  microbrewery.  Tom Schelldorf, co-founder of
of the concept, is the current Chief Executive Officer of the brand.

     Menu.  The  restaurants  feature an  American-style  menu that includes top
choice  steaks and prime rib,  smoked baby back ribs,  fresh  fish,  chicken and
pasta dishes,  deluxe burgers and sandwiches,  hand-tossed  salads with homemade
dressings,  appetizers,  soups and desserts. The menu offers separate selections
for children. The cost of a typical meal, including beverages, ranges from $6.00
to $9.00 per person for lunch and $13.00 to $15.00 per person for  dinner.  Each
restaurant offers four distinctive lager-style beers and ales, plus a variety of
blends of these beers, that are brewed on-premises.  An observation microbrewery
at each restaurant  allows customers to view the entire brewing process.  Except
for one  non-alcoholic  beer,  the  brewed  beers are  typically  the only beers
served.  Full  bar  service  is also  available  at each  restaurant.  Alcoholic
beverages accounted for approximately 16% of sales in 1998.

     Restaurant Layout.  Restaurants range in size from  approximately  5,000 to
7,300 square feet. The on-premise brewing equipment is an integral aspect of the
design and occupies from 450 to 750 square feet. The  restaurant  dining and bar
areas seat from 160 to 240 customers.

     Unit  Economics.  The cost of developing and opening a restaurant  averaged
approximately  $1,525,000  in 1998,  excluding  land and  preopening  costs  but
including  approximately $160,000 in microbrewery  equipment.  Land costs ranged
from $675,000 to $1,000,000 and preopening costs averaged $170,000.

     Field  Management.  Management  is shared by seven  operating  partners and
three area managers who report to both the Vice  President of Operations and the
Chief Executive Officer.  Each operating partner is responsible for four to five
restaurants,  thus  facilitating  a focus  on  quality  of  operations  and unit
profitability.  The  management  staff of a typical  restaurant  consists of one
general  manager,  one  kitchen  manager  and two  assistant  managers.  General
managers  and  kitchen  managers  are  eligible  to receive  bonuses  equal to a
percentage of their restaurant's controllable income, subject to operating above
a minimum operating margin.

     Advertising and Marketing.  Hops'  advertising  and marketing  strategy has
historically   focused   primarily  on  grassroots   efforts  utilizing  special
promotions  in local markets and special  event  equipment  designed to increase
customer awareness and name recognition.  During 1998, advertising and marketing
efforts were expanded  primarily through the use of radio  advertising,  outdoor
boards and print media in regional editions of national publications.  Increased
efforts  are  expected  to  continue  into  1999  with  the  use  of  television
advertising  in core markets and the  continued  use of radio and print media as
well as grassroots efforts.

                              McCormick & Schmick's

     McCormick & Schmick's was  established  in the early 1970's by  co-founders
William  P.  McCormick  and  Douglas  L.  Schmick,  current  Chairman  and Chief
Executive  Officer,  respectively.  Each  restaurant  is designed to capture the
distinctive   attributes  of  the  local  market.   Varying  in  design  from  a
traditional,  New England-style  fish house to a more contemporary  dinner house
with  spectacular  waterfront  views,  many of the  restaurants  are  located in
historical buildings.  Traditional-style  bars are an integral component of each
restaurant.  The same philosophy of distinctiveness  and quality applies equally
to the bar  operation  and the dining  rooms.  Alcoholic  beverages  represented
approximately  27% of sales in 1998.  Restaurants  are operated  under the names
McCormick & Schmick's, McCormick's Fish House, Harborside, Jake's, M&S Grill and
McCormick &  Kuleto's.  McCormick &  Schmick's  offers  superior  service to its
guests and is positioned in a price range at the upper end of moderate.

     Menu.  McCormick & Schmick's  features a daily menu,  offering the freshest
seafood  available  based  on  price  and  product  availability.  With 25 to 30
distinctive species and over 85 individual  selections,  the menu gives range in
culinary  appeal  as well as  price  selection.  The  cost  of a  typical  meal,
including  beverage,  is approximately  $10.00 to $20.00 for lunch and $25.00 to
$35.00 for dinner.



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<PAGE>
     Restaurant  Layout.  Restaurants  range in size from 6,000 to 14,000 square
feet with an average restaurant containing  approximately 8,500 square feet. The
restaurants  generally  seat 200 to 300  customers  in the dining room with some
locations having 40 to 60 additional patio seats available.

     Unit   Economics.   The  average  cost  of  developing  a  restaurant   was
approximately $2,450,000 in 1998, including leasehold improvements, fixtures and
equipment.  All  restaurant  real  estate is  leased.  Additionally,  preopening
expenses average $300,000.

     Field Management. Management is shared by seven multi-unit senior managers,
three  of  which  have  regional  responsibility,  and two  Vice  Presidents  of
Operations.  Staffing  levels  vary  depending  on  restaurant  size.  A typical
restaurant  has a  general  manager,  an  executive  chef,  a sous chef and four
assistant  managers and will employ 80 to 90 full and part-time  employees.  The
McCormick & Schmick's operating philosophy  encourages and trains the management
of  individual  restaurant  units to be creative by  promoting a large degree of
self-sufficiency.

     Advertising and Marketing. Advertising and marketing efforts are focused on
a grassroots philosophy. Each region utilizes the services of a public relations
firm and makes full use of media events targeting the local market.  Advertising
strategies focus on existing and local customers, but also emphasize out-of-town
travelers as a key customer component.  Marketing begins in each restaurant with
daily printed menus and other local  efforts.  A primary focus is to expand name
and location awareness through the use of promotional discount  certificates and
periodic contact with  organizations in the  travel/convention  industry such as
hotels, travel agents and convention centers.

                                   Canyon Cafe

     Canyon Cafe  restaurants  operate under the names Canyon Cafe,  Desert Fire
and Sam's Cafe. The first restaurant was opened in Dallas, Texas in 1989. Canyon
Cafe is dedicated to the flavor and feel of the American Southwest.

     Menu.  The menu offers a wide  variety of unique  items such as Desert Fire
Pasta,  Chile  Rubbed  Grilled  Tuna and  Chipotle  Chicken.  A variety  of more
traditional  items  including  chicken tacos and grilled  chicken salad are also
offered. During 1998, the cost of a typical meal, including beverages, was $9.00
to $14.00 for lunch and $14.00 to $20.00 for  dinner.  Full bar  service is also
provided. Alcoholic beverages accounted for approximately 18% of sales in 1998.

     Restaurant  Layout.  The  restaurants  are based on a Santa Fe design which
reflects a strong southwestern influence through the use of heavy ponderosa pine
timbers.  The walls,  floors and furniture reflect surfaces and colors native to
the American Southwest.  Restaurants are located in malls, in-line power centers
and as freestanding buildings.  In-line and mall sites average 7,000 square feet
with some locations  featuring an additional  800-1,000  square foot patio.  The
freestanding  buildings  have 6,700  square feet with a 1,050 square foot patio.
All locations  typically have a minimum of 190 interior dining seats, an average
of 26 bar seats and 45-50 patio seats.

     Unit  Economics.  In 1998,  the cost of developing and opening a restaurant
averaged  $1,400,000 for in-line/mall  locations and $1,600,000 for freestanding
locations,  excluding land costs and preopening expenses. In 1998, one land site
was purchased at a cost of $947,000. Preopening expenses averaged $151,000.

     Field Management.  Management is structured with a general manager,  two to
three assistant managers,  an executive chef and a sous chef. Regional Directors
are responsible for quality of operations and sales and profitability of four to
five  restaurants  and report to a Director  of  Operations.  All  managers  are
eligible  to  receive   bonuses   based  on  individual   restaurant   operating
performance.

     Advertising  and  Marketing.  Advertising  and  marketing  strategy  relies
on  grassroots  efforts  focused  on  developing  a  strong  brand  identity and
strong   core-customer   recommendations.   Advertising  and  marketing  efforts
include local  radio,  media  appearances,  event  involvement and billboards as
well as direct mail and other print media.



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Additional  local  efforts,  such  as  a system-wide  "neighborhood  networking"
program, are utilized to develop a direct relationship with targeted customers.

                     Other Restaurant Operational Functions

     Quality Control. All levels of management are responsible for ensuring that
restaurants are operated in accordance with strict quality standards. Management
structure allows restaurant  general managers to spend a significant  portion of
their time in the dining area of the restaurant  supervising staff and providing
service to customers. Compliance with quality standards is monitored by periodic
on-site visits and formal periodic inspections by multi-unit management.

     Training.  Each brand requires  employees to participate in formal training
programs.  Management  training  programs  generally  last ten to 16  weeks  and
encompass  three  general  areas,  including  (i) all  service  positions,  (ii)
management accounting,  personnel management, and dining room and bar operations
and (iii)  kitchen  management.  Management  positions  at new  restaurants  are
typically  staffed  with  personnel  who  have  had  previous  experience  in  a
management  position  at  another  of the  respective  brands'  restaurants.  In
addition,  a highly experienced opening team assists in opening each restaurant.
Prior to opening,  all personnel  undergo  intensive  training  conducted by the
restaurant opening team.

     Purchasing.  Avado Brands  strives to obtain  consistent  quality  items at
competitive  prices from  reliable  sources  for all of its brands.  The Company
continually  researches and tests various  products in an effort to maintain the
highest  quality  products and to be  responsive  to changing  customer  tastes.
Purchasing  is handled by each brand,  which,  with the exception of McCormick &
Schmick's,  uses one primary  distributor  for food products other than produce,
which is typically  purchased locally.  At McCormick & Schmick's,  purchasing is
under the direction of each  restaurants'  executive chef in order to obtain the
freshest,  highest quality seafood  available with a focus on local tastes.  All
food and  beverage  products  are  available  on short  notice from  alternative
qualified  suppliers.  The Company has not experienced any significant delays in
receiving food and beverage inventories, restaurant supplies or equipment.

     Restaurant   Reporting.   Financial   controls  are  maintained  through  a
centralized  accounting  system at each brands'  headquarters.  A  point-of-sale
reporting system is utilized in each restaurant.  Restaurant  management submits
to brand headquarters various daily and weekly reports of cash, deposits, sales,
labor costs,  etc. Physical  inventories of all food,  beverage and supply items
are taken at least  monthly.  Operating  results  compared to prior  periods and
budgets are closely monitored by both brand and corporate personnel.

                             Trademarks and Licenses

     Avado Brands has registered the principal trademarks and service marks used
by its restaurant brands with the United States Patent and Trademark Office. The
Company  believes  that its  trademarks  and  service  marks  are  integral  and
important  factors in establishing  the identity and marketing of its restaurant
brands.  Although the Company is aware of certain marks used by other persons in
certain  geographical  areas  which may be similar in  certain  respects  to the
Company's  marks, the Company believes that these other marks will not adversely
affect the Company or its business.

     The restaurant  concepts for the Company's  joint ventures with Belgo Group
PLC and  PizzaExpress  PLC are  licensed  from these  joint  venturers  or their
affiliates.  Such  licenses  are  essential  for the  operation  of these  joint
ventures and include the  licensing  of related  trademarks  and service  marks.

                            Governmental Regulation

     Alcoholic Beverage Regulation.  Each restaurant is subject to licensing and
regulation by a number of  governmental  authorities,  which  include  alcoholic
beverage control and health,  safety and fire agencies in the state,  county and
municipality  in which the  restaurant is located.  Difficulties  or failures in
obtaining the required  licenses or approvals could delay or prevent the opening
of a new restaurant in a particular area. Alcoholic beverage control regulations
require  restaurants to apply to a state  authority  and, in certain  locations,
county  or  municipal  authorities  



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for  a  license  or permit  to sell  alcoholic  beverages on the premises and to
provide  service for extended hours and on Sundays.  Some counties  prohibit the
sale of alcoholic beverages on Sundays.  Typically,  licenses or permits must be
renewed  annually  and may be  revoked  or  suspended  for  cause  at any  time.
Alcoholic  beverage  control   regulations  relate  to  numerous  aspects  of  a
restaurant's operations,  including minimum age of patrons and employees,  hours
of operation, advertising, wholesale purchasing, inventory control and handling,
storage and dispensing of alcoholic beverages.

     The Company may be subject in certain states to "dram-shop"  statutes which
generally provide a person injured by an intoxicated patron the right to recover
damages from an establishment that wrongfully served alcoholic  beverages to the
intoxicated person. The Company carries liquor liability coverage as part of its
existing comprehensive general liability insurance.

     Brewpub Regulation.  Hops is subject to additional  regulations as a result
of the on-premises microbrewery in each restaurant.  Historically, the alcoholic
beverage laws of most states  prohibited the manufacture and retail sale of beer
to consumers  by a single  person or entity or related  persons or entities.  At
present,  all 50 states  allow for the  limited  manufacture  and retail sale of
microbrewed  beer by restaurants and bars  classified as "brewpubs"  under state
law. The Hops restaurants are required to comply with such state brewpub laws in
order to obtain necessary state licenses and permits. Additionally,  many states
impose restrictions on the operations of brewpubs,  such as a prohibition on the
bottling  of beer,  a  prohibition  on the sale of beer for  consumption  off of
restaurant  premises,  and a limitation on the volume of beer that may be brewed
at any location, as well as certain geographic limitations. In addition, certain
states limit the number of brewpubs that may be owned by any person or entity or
a related  group of  entities.  The  Company's  ability to own and operate  Hops
restaurants  in any state is and will continue to be dependent  upon its ability
to operate within the regulatory scheme of such states.

     Other Regulation.  The Company's restaurant  operations are also subject to
Federal  and  state  laws  governing  such  matters  as  minimum  wage,  working
conditions,  overtime and tip credits. The Company experienced a slight increase
in hourly labor costs as a result of the 1996 and 1997  increases in the federal
minimum wage rate.

                                   Competition

     The restaurant  industry in the U.S. is highly  competitive with respect to
price, service, location, and food type and quality, and competition is expected
to  intensify.  There  are a  few,  well-established  competitors  with  greater
financial  and  other  resources  than  Avado  Brands.  Some  of  the  Company's
competitors have been in existence for a substantially  longer period than Avado
Brands  and  may be  better  established  in the  markets  where  the  Company's
restaurants are or may be located.  The restaurant business is often affected by
changes in consumer  tastes,  national,  regional or local economic  conditions,
demographic  trends,  traffic  patterns,  the  availability and cost of suitable
locations,  and the type,  number and  location of  competing  restaurants.  The
Company also  experiences  competition  in attracting  and  retaining  qualified
management level operating  personnel.  In addition,  factors such as inflation,
increased food,  labor and benefits costs,  and difficulty in attracting  hourly
employees  may  adversely  affect the  restaurant  industry in general and Avado
Brands' restaurants in particular.

                                   Employees

     As of January 3, 1999, Avado Brands employed  approximately  20,300 persons
in 29 states plus the District of Columbia.  Of those  employees,  approximately
280  held  management  or  administrative  positions,  1,500  were  involved  in
restaurant  management,  and the  remainder  were  engaged in the  operation  of
restaurants.  Management  believes  that the  Company's  continued  success will
depend to a large  degree on its ability to attract  and retain good  management
employees.  While  the  Company  will  have to  continually  address  a level of
employee attrition normally expected in the food-service industry,  Avado Brands
has taken steps to attract and keep qualified  management  personnel through the
implementation  of a variety of employee  benefit  plans,  including an Employee
Stock  Ownership Plan, a 401(k) Plan, and an incentive stock option plan for its
key  employees.  None of the  Company's  employees  is covered  by a  collective
bargaining agreement. The Company considers its employee relations to be good.



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Item 2.  Properties

     The  Company  owns a  renovated  historic  building  in  Madison,  Georgia,
containing  approximately  19,000  square feet of office  space and an adjoining
building  containing  approximately  41,000 square feet of office  space.  These
office  buildings  have  served  as  the  Company's   corporate  and  Applebee's
headquarters. In 1997, the Company completed construction of a new 44,100 square
foot  facility in Bedford,  Texas,  to house the Don Pablo's  headquarters.  The
headquarters for McCormick & Schmick's is located in approximately 12,000 square
feet of leased space in Portland,  Oregon.  The headquarters for Hops is located
in  approximately  15,000 square feet of leased space in Tampa,  Florida and the
headquarters  for Canyon Cafe is located in  approximately  7,500 square feet of
leased space in Dallas, Texas. The Company believes that its corporate and brand
headquarters are sufficient for its present needs.

     In  selecting  restaurant  sites,  the Company  attempts  to acquire  prime
locations in market areas to maximize both short- and long-term  revenues.  Site
selection is made by each brand's development  department,  subject to executive
officer  approval.  Within the target market areas,  the brands  evaluate  major
retail and office  concentrations  and major traffic arteries to determine focal
points.  Site specific factors include  visibility,  ease of ingress and egress,
proximity  to direct  competition,  accessibility  to  utilities,  local  zoning
regulations,  laws regulating the sale of alcoholic beverages, and various other
factors.



                                       8
<PAGE>
     As of March 1, 1999,  the Company  operated  248  restaurants.  The Company
leases the underlying real estate on which 99 of the restaurants are located and
leases  both the  buildings  and  underlying  real estate for an  additional  60
restaurants.  The remaining 89 restaurants  and related real estate are owned by
the Company. The following table presents restaurant locations by brand:
<TABLE>
<CAPTION>
                       Don                   McCormick       Canyon
                     Pablo's     Hops       & Schmick's       Cafe       Sub-total     Applebee's        Total
-------------------------------------------------------------------------------------------------------------------
<S>                   <C>         <C>              <C>          <C>          <C>             <C>           <C>
Florida                18         27                                          45                            45
Texas                  15                                        5            20                            20
Ohio                   15                                                     15                            15
Indiana                10                                                     10              1             11
California                                          7            2             9                             9
North Carolina          4          5                                           9                             9
Tennessee               5          3                             1             9                             9
Georgia                 4          2                             2             8                             8
Michigan                8                                                      8                             8
Minnesota               7          1                                           8                             8
Pennsylvania            8                                                      8              1              9
Virginia                7                           1                          8              9             17
Colorado                           5                1            1             7                             7
Arizona                 3                                        3             6                             6
Kentucky                4          2                                           6              7             13
South Carolina          2          4                                           6                             6
Washington                                          4            2             6                             6
Maryland                4                           1                          5             10             15
Oregon                                              5                          5                             5
New York                4                                                      4                             4
Oklahoma                4                                                      4                             4
Washington D.C.                                     2                          2                             2
Illinois                1                           1                          2                             2
Missouri                                                         2             2                             2
New Jersey              2                                                      2                             2
Alabama                 1                                                      1                             1
Iowa                    1                                                      1                             1
Nevada                                              1                          1                             1
Delaware                                                                                      2              2
West Virginia                                                                                 1              1
-------------------------------------------------------------------------------------------------------------------
       Totals         127         49               23           18           217             31            248
===================================================================================================================
</TABLE>



                                       9
<PAGE>
Item 3. Legal Proceedings

     In 1997, two lawsuits were filed by persons seeking to represent a class of
shareholders of the Company who purchased  shares of the Company's  common stock
between May 26, 1995 and September 24, 1996.  Each  plaintiff  named the Company
and certain of its officers and directors as defendants.  The complaints alleged
acts  of  fraudulent  misrepresentation  by the  defendants  which  induced  the
plaintiffs to purchase the Company's  common stock and alleged  illegal  insider
trading by certain of the defendants, each of which allegedly resulted in losses
to the  plaintiffs  and  similarly  situated  shareholders  of the Company.  The
complaints  each sought  damages and other relief.  In 1998,  one of these suits
(Artel Foam  Corporation  Pension  Trust,  et al. v. Apple South,  Inc., et al.,
Civil Action No. CV-97-6189) was dismissed. Although the ultimate outcome of the
remaining  lawsuit cannot be determined at this time, the Company  believes that
the  allegations  therein are without  merit and  intends to  vigorously  defend
itself.  

     The Company is involved in various other claims and legal  actions  arising
in the ordinary course of business.  In the opinion of management,  the ultimate
disposition  of these  matters  will not have a material  adverse  effect on the
Company's consolidated financial position or results of operations.

Item 4.  Submission of Matters to a Vote of Security Holders

     The  Company  did not submit any matter to a vote of its  security  holders
during the fourth quarter of the fiscal year ended January 3, 1999.

                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters

     Information in response to this item is  incorporated  by reference to page
36 of the  Company's  Annual  Report to  Shareholders  for the fiscal year ended
January 3, 1999,  the  relevant  portion of which is  attached  as Exhibit  13.1
hereto.

Item 6.  Selected Financial Data

     Information in response to this item is  incorporated  by reference to page
17 of the  Company's  Annual  Report to  Shareholders  for the fiscal year ended
January 3, 1999,  the  relevant  portion of which is  attached  as Exhibit  13.1
hereto.

Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         Of Operations

     Information in response to this item is  incorporated by reference to pages
18 through 22, inclusive, of the Company's Annual Report to Shareholders for the
fiscal year ended January 3, 1999, the relevant  portion of which is attached as
Exhibit 13.1 hereto.

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk

     Information in response to this item is  incorporated  by reference to page
22 of the  Company's  Annual  Report to  Shareholders  for the fiscal year ended
January 3, 1999,  the  relevant  portion of which is  attached  as Exhibit  13.1
hereto.



                                       10
<PAGE>
 Item 8.  Financial Statements and Supplementary Data

     Information in response to this item is  incorporated by reference to pages
23 through 35, inclusive, of the Company's Annual Report to Shareholders for the
fiscal year ended January 3, 1999, the relevant  portion of which is attached as
Exhibit 13.1 hereto.

Item 9.  Changes  in  and  Disagreements with  Accountants  on  Accounting   and
         Financial Disclosure

       Not applicable

                                    Part III

Item 10.  Directors and Executive Officers of the Registrant

     Information  in response to this item is  incorporated  by reference to the
information  contained  under the headings  "Nominees for Director" , "Executive
Officers",  and "Section 16(a) Beneficial Ownership Reporting Compliance" in the
Company's  definitive Proxy Statement for use in connection with the 1999 Annual
Meeting of Shareholders, filed with the Commission on March 31, 1999.

Item 11.  Executive Compensation

     Information  in response to this item is  incorporated  by reference to the
information  contained under the heading "Compensation of Executive Officers" in
the Company's  definitive  Proxy  Statement for use in connection  with the 1999
Annual Meeting of Shareholders,  filed with the Commission on March 31, 1999. In
no event  shall  the  information  contained  in the Proxy  Statement  under the
heading  "Comparison  of  Five-Year  Cumulative  Shareholder  Return"  be deemed
incorporated herein by such reference.

Item 12.  Security Ownership of Certain Beneficial Owners and Management

     Information  in response to this item is  incorporated  by reference to the
information contained under the heading "Voting Securities and Principal Holders
Thereof" in the Company's  definitive Proxy Statement for use in connection with
the 1999 Annual Meeting of Shareholders,  filed with the Commission on March 31,
1999.

Item 13.  Certain Relationships and Related Transactions

     In March 1995, the Company entered into a Split Dollar Insurance  Agreement
(the  "Agreement")  with The DuPree  Insurance  Trust (the "Trust")  whereby the
Company agreed to make premium  payments on certain life  insurance  policies of
which the Trust is the owner and beneficiary.  These policies provide a total of
$50  million in death  proceeds  payable  upon death of the  survivor  of Tom E.
DuPree,  Jr., and his wife.  The devisees  under the wills of Mr. DuPree and his
wife are the beneficiaries of the Trust.

     The Trust has agreed to  reimburse  the Company on an annual basis for that
portion of the premiums which equals the current value of the economic  benefit,
as defined by the Internal Revenue  Service,  attributable to the life insurance
protection  provided.  The premiums due under the  policies  total  $850,000 per
year.  Reimbursements for the current value of the economic benefit attributable
to the life  insurance  provided in fiscal 1998  totaled  $2,308.  There were no
reimbursements due to the Company from the Trust at January 3, 1999.

     The  Company  or the Trust  can  cancel  the  Agreement  at any time.  Upon
cancellation, the Trust is obligated to repay the Company an amount equal to the
lesser of either the cash surrender value of the policies or the total amount of
unreimbursed  premiums paid by the Company.  Upon receipt of the death  proceeds
under  the  policies,  the  Trust 



                                       11
<PAGE>
is  required  to  repay  the  Company for all unreimbursed premium payments. The
policies have been  assigned to the Company to secure the repayment  obligations
of the Trust.

     In 1998,  the  Board of  Directors  approved  loans  to  certain  executive
officers  of the  Company.  At January 3, 1999,  the  Company  held three  notes
receivable  from Tom E.  DuPree,  Jr.,  the  Chairman  of the  Board  and  Chief
Executive  Officer of the  Company,  totaling  $7,851,500.  The notes are due in
November  and  December  of 2000 or earlier  upon demand of the Company and bear
interest at 7.0% with interest  payment due at maturity.  The Company also holds
notes  receivable from Erich J. Booth,  Chief  Financial  Officer and Treasurer,
totaling $107,000 and from Margaret E. Waldrep,  Chief  Administrative  Officer,
totaling  $41,500.  The notes are due in October  and  November of 1999 and bear
interest at 5.06% with interest payment due at maturity.

                                     PART IV

Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a) The following documents are filed as part of this Report:

   1.  Financial Statements

     The following  financial  statement items are set forth in pages 23 through
35 of the  Company's  Annual  Report to  Shareholders  for the fiscal year ended
January 3, 1999,  the  relevant  portion of which is  attached  as Exhibit  13.1
hereto:

     Consolidated  Statements  of Earnings for the years ended  January 3, 1999,
     December 28, 1997 and December 29, 1996

     Consolidated  Balance  Sheets as  ofJanuary  3, 1999 and  December 28, 1997

     Consolidated  Statements of Shareholders'  Equity and Comprehensive  Income
     for the  years  ended  January  3, 1999, December 28, 1997 and December 29,
     1996

     Consolidated  Statements of Cash Flows for the years ended January 3, 1999,
     December  28,  1997  and  December  29,  1996  

     Notes to Consolidated Financial Statements 

     Report of Management Independent 

     Auditors' Report

   2.  Financial Statement Schedules

       None

   3.  Exhibits

     2.1 Agreement  and Plan of Merger,  dated August 15, 1995, by and among the
Company, SALSA Acquisition Corp., and DF&R Restaurants, Inc. (4)

     2.2 Agreement and Plan of Merger among Apple South,  Inc., M&S  Acquisition
of Delaware Inc., and McCormick & Schmick Holding Corp., et. al., dated February
6, 1997. (7)

     2.3 Agreements  and Plan of Merger among Apple South,  Inc., HG Acquisition
Corp., and Mason and Schelldorf  Leasing Company,  Hops  Restaurants,  Inc., et.
al., dated February 6, 1997. (7)

     2.4  Agreement  and  Plan  of  Merger  among  Apple  South,   Inc.,  Coyote
Acquisition Corp., and Canyon Cafes, Inc., et. al., dated June 19, 1997. (8)



                                       12
<PAGE>
     2.5  Asset  Purchase  Agreement  dated  December  23,  1997  by  and  among
Applebee's International, Inc. and Apple South, Inc. (9)

     2.6 Asset  Purchase  Agreement  dated March 16,  1998 by and among  Quality
Restaurant Concepts, L.L.C., and Apple South, Inc. (11)

     2.7 Asset purchase agreement dated April 23, 1998, by an among Apple South,
Inc. and Whit-Mart, Inc. (13)

     2.8 Asset purchase  agreement  dated May 1, 1998, by and among Apple South,
Inc. and T.S.S.O., Inc., and Lois Sedowicz. (13)

     2.9 Asset purchase  agreement  dated May 4, 1998, by and among Apple South,
Inc. and Florida  Apple North,  LLC.,Florida  Apple South,  LLC.,  Florida Apple
West, LLC., and Wigel Partnership. (13)

     2.10 Asset  purchase  agreement  dated June 19,  1998,  by and among  Apple
South, Inc. and U.S. Restaurant Properties Operating LP. (13)

     2.11 Asset  purchase  agreement  dated June 19,  1998,  by and among  Apple
South, Inc. and Darrel L. Rolph. (13)

     2.12 Asset  purchase  agreement  dated July 31,  1998,  by and among  Apple
South, Inc. Delta Bluff , LLC. (14)

     2.13 Asset  purchase  agreement  dated August 20, 1998,  by and among Apple
South,  Inc. and WHG Real Estate South,  LLC. and Wisconsin  Hospitality  Group,
LLC. (15)

     2.14 Asset  purchase  agreement  dated August 20, 1998,  by and among Apple
South, Inc. and WHG Real Estate East, LLC. and Wisconsin Hospitality Group, LLC.
(15)

     2.15 Asset  purchase  agreement  dated  April 6, 1998,  by and among  Apple
South, Inc. and Woodland Group, Inc. (15)

     2.16 Asset purchase agreement dated May 15, 1998, by and among Apple South,
Inc. and Bloomin' Apple, LLC. (15)

     2.17 Asset  purchase  agreement  dated June 26,  1998,  by and among  Apple
South, Inc. and Apple J, L.P. (15)

     2.18 Asset purchase  agreement dated September 15, 1998, by and among Apple
South,  Inc., and WHG Real Estate North,  LLC and Wisconsin  Hospitality  Group,
LLC.

     3.1 Amended and  Restated  Articles of  Incorporation  of the  Company,  as
amended October 13, 1998. (3)

     3.2 By-laws of the Company. (1)

     4.1 See Exhibits 3.1 and 3.2 for  provisions in the  Company's  Amended and
Restated Articles of Incorporation and by-laws defining the rights of holders of
the Company's Common Stock. (1) (3)

     4.2  Indenture  dated May 1, 1996,  between the Company and SunTrust  Bank,
Atlanta, as Trustee. (5)

     4.3 Trust  Agreement  of Apple South  Financing I, dated as of February 18,
1997, among Apple South, Inc., First Union National Bank of Georgia, First Union
Bank of Delaware and Lansing S. Patterson.(10)

     4.4 Amended and Restated  Declaration of Trust of Apple South  Financing I,
dated as of March 11, 1997,  among Apple South,  Inc.,  as Sponsor,  First Union
National  Bank  of  Georgia,  as  Institutional  Trustee,  First  Union  Bank of
Delaware, as Delaware Trustee, and the Regular Trustees named therein. (10)



                                       13
<PAGE>
     4.5 Indenture for the 7% Convertible Subordinated  Debentures,  dated as of
March 6, 1997,  between  Apple  South,  Inc.  and First Union  National  Bank of
Georgia, as Trustee. (10)

     4.6 Form of $3.50 Term Convertible Security,  Series A (included in Exhibit
4.4).

     4.7 Form of 7%  Convertible  Subordinated  Debenture  (included  in Exhibit
4.5).

     4.8 Preferred Securities  Guarantee Agreement,  dated as of March 11, 1997,
between  Apple South,  Inc.,  as  Guarantor,  and First Union  National  Bank of
Georgia, as Preferred Guarantee Trustee. (10)

     4.9 Registration  Rights Agreement,  dated as of March 11, 1997 among Apple
South,  Inc., Apple South Financing I, J.P. Morgan  Securities,  Inc., and Smith
Barney, Inc. (10)

     4.10 Solicitation of Consents to Proposed  Amendments to 9.75% Senior Notes
due 2006 of Apple South, Inc. (13)

     10.1 Apple South, Inc. 1988 Stock Option Plan. (1)

     10.2 Form of Stock Option Agreement under the Apple South,  Inc. 1988 Stock
Option Plan. (1) (6)

     10.3  Form  of  Apple  South,  Inc.  Director's  Indemnification  Agreement
executed by and  between the Company and each member of its Board of  Directors.
(1)

     10.4 Form of Apple South, Inc. Officer's Indemnification Agreement executed
between the Company and each of its executive officers. (1)

     10.5 Apple South, Inc. Employee Stock Ownership Plan and Trust. (1) (6)

     10.6 Apple South, Inc. Profit Sharing Plan and Trust. (1) (6)

     10.7 Amendment No. 2 to the Apple South, Inc. Employee Stock Ownership Plan
and Trust, dated November 22, 1993. (2)

     10.8 Apple  South,  Inc.  [Restated]  Profit  Sharing  Plan and Trust dated
October 26, 1993. (2)

     10.9  Amended form of Stock Option  Agreement  under the Apple South,  Inc.
1988 Stock Option Plan. (2)

     10.10 Apple South, Inc. 1993 Stock Incentive Plan. (2)

     10.11 Form of Stock Option Agreement under the Apple South, Inc. 1993 Stock
Incentive Plan. (2)

     10.12 Second Amended and Restated  Credit  Agreement,  dated March 1, 1998,
among Apple South, Inc. Wachovia Bank,  National  Association,  as agent for the
lenders, and the Banks listed as parties thereto. (11)

     10.13 Participation Agreement (Apple South Trust No. 97-1), dated September
24, 1997,  among Apple South,  Inc., as lessee,  First Security  Bank,  National
Association, as lessor, SunTrust Bank, Atlanta, as administrative agent, and the
holders and lenders signatory thereto. (11)

     10.14  First  amendment,  dated  as of March  27,  1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto. (12)



                                       14
<PAGE>
     10.15  Second  amendment,  dated as of August 14,  1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.16 Third  amendment,  dated as of November  13, 1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.17 Fourth  amendment,  dated as of February 22, 1999,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.18 $70 million Credit  Agreement,  dated December 10, 1997,  among Apple
South, Inc., Wachovia Bank, National Association,  as agent for the lenders, and
the Banks listed as parties thereto. (11)

     10.19 $100  million  Credit  Agreement,  dated  April 1, 1998,  among Apple
South, Inc.,  Wachovia Bank, National  Association,  as agent for the banks, and
the banks listed as parties thereto. (12)

     10.20 First  amendment,  dated as of June 1, 1998,  to $100 million  Credit
Agreement, dated April 1, 1998, among Apple South, Inc., Wachovia Bank, National
Association, as agent for the banks, and the banks listed as parties thereto.

     10.21  Second  amendment,  dated as of October 15,  1998,  to $100  million
Credit Agreement,  dated April 1, 1998, among Apple South, Inc.,  Wachovia Bank,
National  Association,  as agent for the banks,  and the banks listed as parties
thereto.

     10.22 Third amendment, dated as of January 22, 1999, to $100 million Credit
Agreement, dated April 1, 1998, among Apple South, Inc., Wachovia Bank, National
Association, as agent for the banks, and the banks listed as parties thereto.

     10.23 $30 million Credit  Agreement,  dated May 8, 1998, among Apple South,
Inc. as borrower and First Union National Bank as lender.

     10.24 First  amendment,  dated as of June 28, 1998,  to $30 million  Credit
Agreement,  dated May 8, 1998,  among Apple  South,  Inc. as borrower  and First
Union National Bank as lender.

     10.25  Second  amendment,  dated as of November  17,  1998,  to $30 million
Credit  Agreement,  dated May 8, 1998,  among Apple South,  Inc. as borrower and
First Union National Bank as lender.

     10.26 Third amendment, dated as of February 26, 1999, to $30 million Credit
Agreement,  dated May 8, 1998,  among Apple  South,  Inc. as borrower  and First
Union National Bank as lender.

     10.27 $30 million  Supplemental Credit Facility  Agreement,  dated December
24, 1998, among Avado Brands, Inc. and Wachovia Capital Investments, Inc.

     10.28   Addendum  1,  dated  as  of  February  26,  1999,  to  $30  million
Supplemental  Credit Facility  Agreement,  dated December 24, 1998,  among Avado
Brands, Inc. and Wachovia Capital Investments, Inc.

     10.29  Addendum 2, dated as of March 8, 1999,  to $30 million  Supplemental
Credit Facility Agreement, dated December 24, 1998, among Avado Brands, Inc. and
Wachovia Capital Investments, Inc.



                                       15
<PAGE>
     13.1 Excerpts from Annual Report to Shareholders  for the fiscal year ended
January 3, 1999.

     22.1 Subsidiaries of the Registrant.

     23.1 Consent of KPMG LLP.

     27.1 Financial Data Schedule (EDGAR version only).

     99.1 Safe harbor  under the  Private  Securities  Litigation  Reform Act of
1995. (8)

     ---------------------------------------------------------------------------
     (1)  Incorporated  by reference to the  corresponding  exhibit number filed
with the registrant's Registration Statement on Form S-1, File No. 33-42662.

     (2)  Incorporated  by reference to the  registrant's  Annual Report on Form
10-K for its fiscal year ended December 31, 1993.

     (3)  Incorporated by reference to the  registrant's  Current Report on Form
8-K dated October 13, 1998.

     (4) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended October 1, 1995.

     (5) Incorporated by reference to the registrant's registration statement on
Form S-3, File No. 333-02958.

     (6)  Incorporated  by reference to the  registrant's  Annual Report on Form
10-K for the fiscal year ended December 31, 1995.

     (7) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended March 30, 1997.

     (8) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended June 29, 1997.

     (9) Incorporated by reference to the registrant's  Report on Form 8-K dated
January 15, 1998.

     (10) Incorporated by reference to the registrants's  registration statement
on Form S-3, File No. 333-25205.

     (11)  Incorporated by reference to the  registrant's  Annual Report on form
10-K for the fiscal year ended December 28, 1997.

     (12) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended March 29, 1998.

     (13) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended June 28, 1998.

     (14) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended September 27, 1998.

     (15) Incorporated by reference to the registrant's Report on Form 8-K dated
September 14, 1998.


(b)   Reports on Form 8-K

       Form 8-K dated October 13, 1998, reporting the Company's name change.



                                       16
<PAGE>
     SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, as amended,  the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

                               AVADO BRANDS, INC.


                                                By:  /s/ Tom E. DuPree, Jr.
                                                     ---------------------------
                                                     Tom E. DuPree, Jr.
                                                     Chief Executive Officer and
                                                     Chairman of the Board

March 16, 1999
Atlanta, Georgia

     Pursuant to the  requirements  of the  Securities  Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.

Signature                            Title                            Date


/s/ Tom E. DuPree, Jr.       Chairman of the Board of             March 16, 1999
------------------------     Directors and Chief Executive
Tom E. DuPree, Jr.           Officer (principal executive officer)
                                                   
/s/ Erich J. Booth           Director and Chief Financial         March 16, 1999
------------------------     Officer (principal financial officer) 
Erich J. Booth                              

/s/ John G. McLeod, Jr.      Senior Vice President - Human        March 16, 1999
------------------------     Resources, and Secretary
John G. McLeod, Jr.                         

/s/ Margaret E. Waldrep      Chief Administrative Officer         March 16, 1999
------------------------
Margaret E. Waldrep

/s/ Louis J. Profumo         Chief Accounting Officer             March 16, 1999
------------------------     (principal accounting officer)
Louis J. Profumo                           

/s/ Thomas R. Williams       Director                             March 16, 1999
------------------------
Thomas R. Williams

/s/ James W. Rowe            Director                             March 16, 1999
------------------------
James W. Rowe

/s/ Dr. Ruth G. Shaw         Director                             March 16, 1999
------------------------
Dr. Ruth G. Shaw

/s/ John L. Moorhead         Director                             March 16, 1999
------------------------
John L. Moorhead



                                       17
<PAGE>
                                 Exhibit Index

Exhibit Number

  2.1 Agreement  and Plan of Merger,  dated August 15, 1995, by and among the
Company, SALSA Acquisition Corp., and DF&R Restaurants, Inc. (4)

     2.2 Agreement and Plan of Merger among Apple South,  Inc., M&S  Acquisition
of Delaware Inc., and McCormick & Schmick Holding Corp., et. al., dated February
6, 1997. (7)

     2.3 Agreements  and Plan of Merger among Apple South,  Inc., HG Acquisition
Corp., and Mason and Schelldorf  Leasing Company,  Hops  Restaurants,  Inc., et.
al., dated February 6, 1997. (7)

     2.4  Agreement  and  Plan  of  Merger  among  Apple  South,   Inc.,  Coyote
Acquisition Corp., and Canyon Cafes, Inc., et. al., dated June 19, 1997. (8)

     2.5  Asset  Purchase  Agreement  dated  December  23,  1997  by  and  among
Applebee's International, Inc. and Apple South, Inc. (9)

     2.6 Asset  Purchase  Agreement  dated March 16,  1998 by and among  Quality
Restaurant Concepts, L.L.C., and Apple South, Inc. (11)

     2.7 Asset purchase agreement dated April 23, 1998, by an among Apple South,
Inc. and Whit-Mart, Inc. (13)

     2.8 Asset purchase  agreement  dated May 1, 1998, by and among Apple South,
Inc. and T.S.S.O., Inc., and Lois Sedowicz. (13)

     2.9 Asset purchase  agreement  dated May 4, 1998, by and among Apple South,
Inc. and Florida  Apple North,  LLC.,Florida  Apple South,  LLC.,  Florida Apple
West, LLC., and Wigel Partnership. (13)

     2.10 Asset  purchase  agreement  dated June 19,  1998,  by and among  Apple
South, Inc. and U.S. Restaurant Properties Operating LP. (13)

     2.11 Asset  purchase  agreement  dated June 19,  1998,  by and among  Apple
South, Inc. and Darrel L. Rolph. (13)

     2.12 Asset  purchase  agreement  dated July 31,  1998,  by and among  Apple
South, Inc. Delta Bluff , LLC. (14)

     2.13 Asset  purchase  agreement  dated August 20, 1998,  by and among Apple
South,  Inc. and WHG Real Estate South,  LLC. and Wisconsin  Hospitality  Group,
LLC. (15)

     2.14 Asset  purchase  agreement  dated August 20, 1998,  by and among Apple
South, Inc. and WHG Real Estate East, LLC. and Wisconsin Hospitality Group, LLC.
(15)

     2.15 Asset  purchase  agreement  dated  April 6, 1998,  by and among  Apple
South, Inc. and Woodland Group, Inc. (15)

     2.16 Asset purchase agreement dated May 15, 1998, by and among Apple South,
Inc. and Bloomin' Apple, LLC. (15)

     2.17 Asset  purchase  agreement  dated June 26,  1998,  by and among  Apple
South, Inc. and Apple J, L.P. (15)

     2.18 Asset purchase  agreement dated September 15, 1998, by and among Apple
South,  Inc., and WHG Real Estate North,  LLC and Wisconsin  Hospitality  Group,
LLC.

     3.1 Amended and  Restated  Articles of  Incorporation  of the  Company,  as
amended October 13, 1998. (3)



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<PAGE>
     3.2 By-laws of the Company. (1)

     4.1 See Exhibits 3.1 and 3.2 for  provisions in the  Company's  Amended and
Restated Articles of Incorporation and by-laws defining the rights of holders of
the Company's Common Stock. (1) (3)

     4.2  Indenture  dated May 1, 1996,  between the Company and SunTrust  Bank,
Atlanta, as Trustee. (5)

     4.3 Trust  Agreement  of Apple South  Financing I, dated as of February 18,
1997, among Apple South, Inc., First Union National Bank of Georgia, First Union
Bank of Delaware and Lansing S. Patterson.(10)

     4.4 Amended and Restated  Declaration of Trust of Apple South  Financing I,
dated as of March 11, 1997,  among Apple South,  Inc.,  as Sponsor,  First Union
National  Bank  of  Georgia,  as  Institutional  Trustee,  First  Union  Bank of
Delaware, as Delaware Trustee, and the Regular Trustees named therein. (10)

     4.5 Indenture for the 7% Convertible Subordinated  Debentures,  dated as of
March 6, 1997,  between  Apple  South,  Inc.  and First Union  National  Bank of
Georgia, as Trustee. (10)

     4.6 Form of $3.50 Term Convertible Security,  Series A (included in Exhibit
4.4).

     4.7 Form of 7%  Convertible  Subordinated  Debenture  (included  in Exhibit
4.5).

     4.8 Preferred Securities  Guarantee Agreement,  dated as of March 11, 1997,
between  Apple South,  Inc.,  as  Guarantor,  and First Union  National  Bank of
Georgia, as Preferred Guarantee Trustee. (10)

     4.9 Registration  Rights Agreement,  dated as of March 11, 1997 among Apple
South,  Inc., Apple South Financing I, J.P. Morgan  Securities,  Inc., and Smith
Barney, Inc. (10)

     4.10 Solicitation of Consents to Proposed  Amendments to 9.75% Senior Notes
due 2006 of Apple South, Inc. (13)

     10.1 Apple South, Inc. 1988 Stock Option Plan. (1)

     10.2 Form of Stock Option Agreement under the Apple South,  Inc. 1988 Stock
Option Plan. (1) (6)

     10.3  Form  of  Apple  South,  Inc.  Director's  Indemnification  Agreement
executed by and  between the Company and each member of its Board of  Directors.
(1)

     10.4 Form of Apple South, Inc. Officer's Indemnification Agreement executed
between the Company and each of its executive officers. (1)

     10.5 Apple South, Inc. Employee Stock Ownership Plan and Trust. (1) (6)

     10.6 Apple South, Inc. Profit Sharing Plan and Trust. (1) (6)

     10.7 Amendment No. 2 to the Apple South, Inc. Employee Stock Ownership Plan
and Trust, dated November 22, 1993. (2)

     10.8 Apple  South,  Inc.  [Restated]  Profit  Sharing  Plan and Trust dated
October 26, 1993. (2)

     10.9  Amended form of Stock Option  Agreement  under the Apple South,  Inc.
1988 Stock Option Plan. (2)

     10.10 Apple South, Inc. 1993 Stock Incentive Plan. (2)



                                       19
<PAGE>
     10.11 Form of Stock Option Agreement under the Apple South, Inc. 1993 Stock
Incentive Plan. (2)

     10.12 Second Amended and Restated  Credit  Agreement,  dated March 1, 1998,
among Apple South, Inc. Wachovia Bank,  National  Association,  as agent for the
lenders, and the Banks listed as parties thereto. (11)

     10.13 Participation Agreement (Apple South Trust No. 97-1), dated September
24, 1997,  among Apple South,  Inc., as lessee,  First Security  Bank,  National
Association, as lessor, SunTrust Bank, Atlanta, as administrative agent, and the
holders and lenders signatory thereto. (11)

     10.14  First  amendment,  dated  as of March  27,  1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto. (12)

     10.15  Second  amendment,  dated as of August 14,  1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.16 Third  amendment,  dated as of November  13, 1998,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.17 Fourth  amendment,  dated as of February 22, 1999,  to  Participation
Agreement  (Apple South Trust No 97-1),  dated  September 24, 1997,  among Apple
South, Inc., as lessee,  First Security Bank, National  Association,  as lessor,
SunTrust Bank,  Atlanta,  as  administrative  agent, and the holders and lenders
signatory thereto.

     10.18 $70 million Credit  Agreement,  dated December 10, 1997,  among Apple
South, Inc., Wachovia Bank, National Association,  as agent for the lenders, and
the Banks listed as parties thereto. (11)

     10.19 $100  million  Credit  Agreement,  dated  April 1, 1998,  among Apple
South, Inc.,  Wachovia Bank, National  Association,  as agent for the banks, and
the banks listed as parties thereto. (12)

     10.20 First  amendment,  dated as of June 1, 1998,  to $100 million  Credit
Agreement, dated April 1, 1998, among Apple South, Inc., Wachovia Bank, National
Association, as agent for the banks, and the banks listed as parties thereto.

     10.21  Second  amendment,  dated as of October 15,  1998,  to $100  million
Credit Agreement,  dated April 1, 1998, among Apple South, Inc.,  Wachovia Bank,
National  Association,  as agent for the banks,  and the banks listed as parties
thereto.

     10.22 Third amendment, dated as of January 22, 1999, to $100 million Credit
Agreement, dated April 1, 1998, among Apple South, Inc., Wachovia Bank, National
Association, as agent for the banks, and the banks listed as parties thereto.

     10.23 $30 million Credit  Agreement,  dated May 8, 1998, among Apple South,
Inc. as borrower and First Union National Bank as lender.

     10.24 First  amendment,  dated as of June 28, 1998,  to $30 million  Credit
Agreement,  dated May 8, 1998,  among Apple  South,  Inc. as borrower  and First
Union National Bank as lender.

     10.25  Second  amendment,  dated as of November  17,  1998,  to $30 million
Credit  Agreement,  dated May 8, 1998,  among Apple South,  Inc. as borrower and
First Union National Bank as lender.



                                       20
<PAGE>
     10.26 Third amendment, dated as of February 26, 1999, to $30 million Credit
Agreement,  dated May 8, 1998,  among Apple  South,  Inc. as borrower  and First
Union National Bank as lender.

     10.27 $30 million  Supplemental Credit Facility  Agreement,  dated December
24, 1998, among Avado Brands, Inc. and Wachovia Capital Investments, Inc.

     10.28   Addendum  1,  dated  as  of  February  26,  1999,  to  $30  million
Supplemental  Credit Facility  Agreement,  dated December 24, 1998,  among Avado
Brands, Inc. and Wachovia Capital Investments, Inc.

     10.29  Addendum 2, dated as of March 8, 1999,  to $30 million  Supplemental
Credit Facility Agreement, dated December 24, 1998, among Avado Brands, Inc. and
Wachovia Capital Investments, Inc.

     13.1 Excerpts from Annual Report to Shareholders  for the fiscal year ended
January 3, 1999.

     22.1 Subsidiaries of the Registrant.

     23.1 Consent of KPMG LLP.

     27.1 Financial Data Schedule (EDGAR version only).

     99.1 Safe harbor  under the  Private  Securities  Litigation  Reform Act of
1995. (8)

     ---------------------------------------------------------------------------
     (1)  Incorporated  by reference to the  corresponding  exhibit number filed
with the registrant's Registration Statement on Form S-1, File No. 33-42662.

     (2)  Incorporated  by reference to the  registrant's  Annual Report on Form
10-K for its fiscal year ended December 31, 1993.

     (3)  Incorporated by reference to the  registrant's  Current Report on Form
8-K dated October 13, 1998.

     (4) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended October 1, 1995.

     (5) Incorporated by reference to the registrant's registration statement on
Form S-3, File No. 333-02958.

     (6)  Incorporated  by reference to the  registrant's  Annual Report on Form
10-K for the fiscal year ended December 31, 1995.

     (7) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended March 30, 1997.

     (8) Incorporated by reference to the registrant's  Quarterly Report on Form
10-Q for its fiscal quarter ended June 29, 1997.

     (9) Incorporated by reference to the registrant's  Report on Form 8-K dated
January 15, 1998.

     (10) Incorporated by reference to the registrants's  registration statement
on Form S-3, File No. 333-25205.

     (11)  Incorporated by reference to the  registrant's  Annual Report on form
10-K for the fiscal year ended December 28, 1997.

     (12) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended March 29, 1998.

     (13) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended June 28, 1998.

     (14) Incorporated by reference to the registrant's Quarterly Report on Form
10-Q for its fiscal quarter ended September 27, 1998.

     (15) Incorporated by reference to the registrant's Report on Form 8-K dated
September 14, 1998.



                                       21