Caught in the Act

Katharine McPhee & Megan Hilty's Celebratory Champagne-Filled Dinner Party

07/13/2012 at 06:00 AM EDT

Katharine McPhee and Megan Hilty were back on set Tuesday, filming season two of Smash, but a long work day didn't prevent the ladies from a bubbly-filled night of fun to celebrate being together again.

Sipping on Champagne Nicolas Feuillatte and noshing on French cuisine at Bagatelle in New York City, the ladies were joined by Hilty's beau Brian Gallagher and some new and returning cast members of the show.

"Everyone was smiling and toasting away," an onlooker tells PEOPLE. "They referred to the first day back on set as 'the first day of school,' but seemed to be loving every minute of it.' "

At one point, says the source, Hilty took the remaining cork and collar from one of the table's champagne bottles and said she wanted to make a necklace out of it as a "keepsake of the evening."
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