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VANCOUVER, March 2 /CNW/ --
/NOT FOR DISTRIBUTION TO THE UNITED STATES NEWS WIRE SERVICES OR
DISSEMINATION IN THE UNITED STATES/
Toronto Stock Exchange AW.UN
VANCOUVER, March 2 /CNW/ - A&W Revenue Royalties Income Fund (the
"Fund") and A&W Food Services of Canada Inc. ("Food Services")
announced today that Food Services has completed a secondary bought
deal offering of units of the Fund (the "Offering") in connection with
an agreement with a syndicate of underwriters led by CIBC and National
Bank Financial Inc. and including BMO Capital Markets, RBC Capital
Markets, Scotia Capital Inc., TD Securities Inc., Canaccord Genuity
Corp., HSBC Securities (Canada) Inc. and Raymond James Ltd.
(collectively, the "Underwriters"). The Underwriters purchased
2,997,000 units of the Fund ("Units") from Food Services at a purchase
price of $23.35 per Unit for gross proceeds of $69,979,950. The Fund
did not receive any proceeds of the Offering. Food Services paid the
expenses of the Offering.
Prior to the closing of the Offering, Food Services owned securities
indirectly exchangeable for 4,247,358 Units (the "Exchangeable
Securities"), representing approximately a 34% indirect interest in the
Fund. Food Services only exchanged the number of Exchangeable
Securities needed for the number of Units to be sold pursuant to the
Offering. Following the closing of the Offering, Food Services now
owns Exchangeable Securities indirectly exchangeable for 1,250,358
Units, or approximately a 10% indirect interest in the Fund.
There is no change in the total number of equivalent Units outstanding
and no change in the amount of cash available to pay distributions as a
result of the Offering. The regular monthly distribution will remain
at 11.7 cents per month per Unit. The first distribution that
purchasers of the Units acquired under the Offering will be entitled to
receive is the distribution expected to be paid on March 31, 2011 to
unitholders of record on March 15, 2011.
Food Services has today declared a dividend in the aggregate amount of
$62,730,000 to its shareholder of record on March 9, 2011.
This news release does not constitute an offer to sell or a solicitation
of an offer to buy any securities in the United States. The securities
have not been registered under the U.S. Securities Act of 1933, as
amended, or any state securities laws, and may not be offered or sold
within the United States, absent such registration or an applicable
exemption from such registration requirements.
About the Fund
The Fund is a limited purpose trust established to invest in A&W Trade
Marks Inc. ("TMI"), which through its interest in the A&W Trade Marks
Limited Partnership (the "Partnership"), owns the A&W trade-marks used
in the A&W quick service restaurant business in Canada. The A&W
trade-marks comprise some of the best-known brand names in the Canadian
foodservice industry. In return for licensing Food Services to use its
trade-marks, TMI (through the Partnership) received royalties equal to
3% of the sales A&W restaurants in the Royalty Pool. Food Services is
the second largest quick service hamburger restaurant chain in Canada.
Operating coast-to-coast, A&W restaurants feature famous trade-marked
menu items such as The Burger Family, Chubby Chicken and A&W Root Beer.
The Royalty Pool is adjusted annually to reflect sales from new A&W
restaurants, net of the sales of any A&W restaurants that have
permanently closed. Additional limited partnership units are issued to
Food Services to reflect the annual adjustment. Food Services'
additional limited partnership units are exchangeable for additional
non-voting common shares of TMI which shares are exchangeable for Units
of the Fund.
TMI's dividends to the Fund and to Food Services, and the Fund's
distributions to unitholders are based on top-line revenues of the A&W
restaurants in the Royalty Pool, less interest, general and
administrative expenses and current income taxes of TMI, and are
thereby isolated from many of the factors that impact an operating
business.
Certain statements in this report may be forward-looking in nature.
Actual results may differ materially from those expressed or implied in
these forward-looking statements. The forward-looking statements are
based on assumptions that management considered reasonable at the time
they were prepared. These forward-looking statements are subject to a
number of risk factors, including general economic and business
conditions, unemployment, harmonization of sales taxes, financial and
political instability, changes in income tax laws or their application
to the Fund and other factors disclosed previously and from time to
time in the Fund's public filings. Forward-looking information is
provided as of the date hereof and, except as required by law, we
assume no obligation to update or revise forward-looking information to
reflect new events or circumstances.
Additional information relating to the Fund is on SEDAR at www.sedar.com and on the Fund's website at www.awincomefund.ca.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/March2011/02/c7035.html
pDon Leslie, Chief Financial Officer: (604) 988-2141 or a href="mailto:investorrelations@aw.ca"investorrelations@aw.ca/a/p