Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District of Delaware in Wilmington is set to consider confirming the plan and approving the financing on June 27.

Buffets disclosed the terms of the exit loan in a plan supplement filed June 20. An ad hoc group of first-lien lenders will provide the loan. Lenders that participated in Buffets' $50 million debtor-in-possession loan would be given the option to commit under the exit loan.

The $50 million term loan exit facility would repay Buffets' DIP in full and provide working capital for the reorganized company. The loan would bear interest at adjusted LIBOR plus 9%, with a floor of 1.5%, or an alternate base rate plus 8%. ABR is the greatest of prime, the federal funds rate plus 0.5%, adjusted LIBOR and 2.5%.

The loan, which would mature fie years after closing, would carry a 1% backstop fee, a 1% closing fee and an undisclosed agency fee.

The exit facility would repay an all-new-money DIP led by the Cayman Islands branch of Credit Suisse Group. The DIP includes a $20 million synthetic letter-of-credit facility and a $30 million term loan, which was split into three tranches. The LOC facility and the first two term loan tranches, similar to the exit loan, accrue interest at an alternate base rate plus 8% or adjusted LIBOR plus 9%, with a LIBOR floor of 1.5%. The third term loan tranche is priced 250 basis points higher.

Buffets filed for Chapter 11 on Jan. 18 with a prenegotiated plan supported by 83% of its first-lien lenders. The restaurant operator amended the plan on April 20 to provide $4 million for general unsecured creditors, previously slated to receive nothing. The debtor filed its latest version on April 30, which contained no significant changes.

Under the plan, administrative, priority tax and priority nontax claims would be paid in full on the plan's effective date.

First-lien lenders would receive a pro rata share of 100% of the reorganized equity in Buffets, subject to dilution from a management incentive plan and reserved shares. All outstanding amounts under the first-lien credit agreement would remain on deposit from the effective date through April 22, 2015, and would subsequently be returned to the lenders.

The equity would repay about $245 million in debt, as well as about $30 million in annual interest. Buffets estimated a 50% recovery for first-lien lenders.

Second-lien lenders would receive a pro rata share of amounts on deposit related to letters of credit. In its disclosure statement, Buffets said the second-lien lenders could receive anywhere from 0% to 100% of their claims.

Other secured claims would be either reinstated or paid in full 30 days after the effective date.

General unsecured creditors would receive a pro rata share of the $4 million cash pool, for a recovery of about 6% to 9%.

Equity holders would be wiped out.

Walrath approved the plan's disclosure statement on April 30.

Court papers filed Monday, June 25, show all first- and second-lien lenders voted in favor of the plan, as did 94.33% of general unsecured creditors holding 81.83% of voted claim amounts.

When it filed for Chapter 11, Buffets operated 483 steak-buffet restaurants under the names Old Country Buffet, Country Buffet, HomeTown Buffet, Ryan's and Fire Mountain, as well as 11 full-service Tahoe Joe's Famous Steakhouse casual dining restaurants, serving about 2.7 million customers per week. It now operates more than 350 restaurants.

Buffets previously filed for Chapter 11 on Jan. 22, 2008, and exited that case on April 28, 2009, with about $304 million in first- and second-lien financing from Credit Suisse Securities (USA) LLC and Credit Suisse Group.

Even when it exited its previous reorganization, however, Buffets didn't believe it would turn a profit for several years, and the company suffered due to a sluggish economy, documents show.

The Eagan, Minn., debtor listed assets of $100 million to $500 million and liabilities of $300.47 million in court papers.

Jeffrey D. Saferstein of Paul, Weiss, Rifkind, Wharton & Garrison LLP is debtor counsel. Pauline K. Morgan of Young Conaway Stargatt & Taylor LLP is Buffets' co-counsel.

Scott L. Hazan and Jenette A. Barrow-Bosshart of Otterbourg, Steindler, Houston & Rosen PC and Bradford J. Sandler and Peter J. Keane of Pachulski Stang Ziehl & Jones LLP represent the official committee of unsecured creditors.

Matthew A. Feldman, Paul V. Shalhoub and Marina Zelinsky of Willkie Farr & Gallagher LLP and Bonnie Glantz Fatell and Alan M. Root of Blank Rome LLP are counsel to a committee of first-lien lenders. Its financial adviser is CDG Group LLC.