Buffets receives consents needed to amend 11¼% notes

By Laura Lutz

Des Moines, Oct. 17 - Buffets Holdings Inc. announced that Buffets, Inc. received the consents that it needed in its tender offer and consent solicitation for its 11¼% senior subordinated notes due 2010.

Holders of 97% of the notes submitted tenders before the early tender deadline at 9 a.m. ET on Oct. 16.

The tender offer will continue until 9 a.m. ET on Oct. 31.

The consent solicitations allow Buffets to amend the note indentures to eliminate substantially all of the restrictive covenants and certain events of default.

Buffets will pay $1,058.75 per $1,000 principal amount plus accrued interest up to but excluding the payment date.

The payout includes a $30.00 per $1,000 principal amount at maturity consent payment that will only be paid to holders who tendered with consents by the early tender date.

The offer was announced on Sept. 15 alongside a tender offer by Buffets Holdings for its $132 million principal amount at maturity of 13 7/8% senior discount notes due 2010.

On Oct. 16, the early tender deadline for the 13 7/8% notes was moved to 9 a.m. ET on Oct. 19 from Oct. 16, and the offer was extended to 9 a.m. ET on Nov. 3, from Oct. 31.

For each $1,000 principal amount of the 13 7/8% notes, Buffets Holdings will pay the sum of the accreted value of the $1,000 principal amount at maturity on the applicable payment date and 50% of a make-whole premium determined using the yield of a U.S. Treasury security maturing on or near the July 31, 2008 first redemption date for the notes plus 50 basis points and an additional premium amount.

After an Oct. 16 revision, the additional premium amount will be equal to 1.377181 multiplied by the difference between the accreted value of the note on the applicable payment date and its accreted value on Dec. 29, 2005.

Buffets had not previously announced the size of the additional premium, saying that it was described in the tender offer documents.

The 13 7/8% tender payment also includes a $30 consent fee per $1,000 principal amount or principal amount at maturity of notes tendered before the early tender deadline.

Holders who tender are required to deliver consents in both offers.

Buffets said On Sept. 15 that holders of more than 80% of the 13 7/8% notes had already agreed to tender their notes by Oct 16.

The tenders are subject to conditions including the receipt of consents from holders of a majority of each series of notes and Buffets obtaining the financing needed to pay for the notes.

Credit Suisse Securities (USA) LLC is dealer manager for both offers (800 820-1653 or collect 212 538-0652). Morrow & Co., Inc. is the information agent (800 607-0088).

Buffets is an Eagan, Minn., restaurant operator.

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