Sentinel and Caxton-Iseman acquire Buffets, Inc. for $665 million

NEW YORK, October 4, 2000 - Sentinel Capital Partners, Caxton-Iseman Capital, Inc. and management of Buffets, Inc. (NASDAQ:BOCB) are pleased to announce the acquisition of the company in a transaction valued at $665 million. Buffets, headquartered in Eagan, Minnesota, is the largest operator of high quality buffet-style restaurants in the United States with 403 restaurants in 38 states operating under the brand names Old Country Buffet and HomeTown Buffet.

"This deal is consistent with Sentinel's plan to invest selectively in quality restaurant franchises," said David Lobel, Sentinel's Founder and Managing Partner. "Buffets enjoys a leading position in the scatter-bar segment of the restaurant industry, which has enjoyed a 17% compound annual growth rate since 1990.

"Buffets is the market leader, currently holding 22% of the $4.2 billion buffet/cafeteria segment, making it nearly twice as large as its next largest competitor," Lobel added. "Naturally, we are delighted to join in this deal with Caxton-Iseman Capital Partners, a leading private equity firm, and we look forward to serving with them on Buffets' Board of Directors as we assist the company's management team in every way possible."

Lehman Brothers Inc., Fleet Securities Inc. and First Union National Bank provided senior debt financing for the transaction. Credit Suisse First Boston Corp. arranged mezzanine financing.

Buffets is well positioned in the mid-scale dining segment and offers a convenient, value-priced selection of high quality food and excellent customer service. Buffets was an early innovator of the scatter-bar concept, in which food is presented on self-service islands from which customers select the items and portions of their choice. With innovations such as the scatter-bar system and all-inclusive pricing, Buffets' brands are synonymous with the modern buffet concept.

Buffets' formula of exceptional value, convenience, quality, and service has generated consistent growth in sales and profits for the past 16 years. Buffets has also successfully grown comparable store sales for 11 consecutive quarters. Management's strategic objective is to reinforce Buffets' position as the market leader in the buffet-style restaurant segment by expanding its core Old Country Buffet and Hometown Buffet concepts. Buffets will also selectively expand its complementary Tahoe Joe's and Original Roadhouse Grill concepts.

About Caxton-Iseman Capital
Caxton-Iseman Capital is a New York-based private equity investment firm specializing in leveraged buyouts. The firm's investment vehicles currently have $700 million of capital available to them for leveraged buyouts. Caxton-Iseman Capital is funded primarily by affiliates of Caxton Corporation, a New York investment firm whose affiliated companies have in excess of $3.5 billion of capital.