Buffets Holdings gets consents for 81% of 13 7/8% notes by early deadline

By Laura Lutz

Des Moines, Oct. 19 - Buffets Holdings Inc. announced that it received the consents that it needed in its tender offer and consent solicitation for its $132 million principal amount at maturity of 13 7/8% senior discount notes due 2010.

Holders of 81% of the notes submitted tenders before the early tender deadline at 9 a.m. ET on Oct. 19.

The consents allow the company to amend the note indentures to eliminate substantially all of the restrictive covenants and certain events of default.

The tender offer will continue until 9 a.m. ET on Nov. 3.

When the tender offer was announced on Sept. 15, Buffets said that holders of more than 80% of the 13 7/8% notes had already agreed to tender their notes by Oct 16.

On Oct. 16, the early tender deadline and tender expiration had been extended from Oct. 16 and Oct. 31, respectively.

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.

Following an Oct. 16 amendment, 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 originally disclosed the size of the additional premium, saying that it was described in the tender offer documents.

The tender payment includes a $30 consent fee per $1,000 principal amount at maturity of notes tendered before the early tender deadline.

The offer was announced alongside a tender offer for the 11¼% senior subordinated notes due 2010 of Buffets, Inc..

Buffets announced on Oct. 17 that it had received tenders and consents from holders of 97% of the 11¼% notes by the early tender deadline on Oct. 16.

Those consents also allow Buffets to amend the note indentures to eliminate substantially all of the restrictive covenants and certain events of default.

For the 11¼% notes, Buffest will pay $1,058.75 per $1,000 principal amount plus accrued interest up to but excluding the payment date.

The payout for the 11¼% notes includes a $30.00 per $1,000 principal amount consent payment that will only be paid to holders who tendered with consents by the early tender date.

The 11¼% tender offer ends at 9 a.m. ET on Oct. 31.

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

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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