Leading Proxy Advisor Recommends Unitholders of A&W Revenue Royalties Income Fund Vote FOR Combination Transaction with A&W Food Services

VANCOUVER, BC, Oct. 2, 2024 /CNW/ - A&W Revenue Royalties Income Fund (TSX: AW.UN) (the "Fund") is pleased to announce that Institutional Shareholder Services Inc. ("ISS"), a leading independent proxy advisory firm, has recommended that unitholders of the Fund vote FOR the proposed strategic combination (the "Transaction") between the Fund and A&W Food Services of Canada Inc. ("A&W Food Services") to create a leading publicly traded growth-focused quick-service restaurant ("QSR") franchisor ("A&W Food Services NewCo").

ISS cited the "compelling strategic rationale, premium, credible valuation, and non-approval risk" as the basis for its recommendation that unitholders vote in favour of the Transaction.

"The endorsement from ISS is a testament to the strategic benefits of the transaction," said Susan Senecal, President and Chief Executive Officer of the Fund and A&W Food Services. "We are confident that this combination will deliver significant value to our unitholders and drive further growth in the years to come."

The Board of Trustees of the Fund recommends that unitholders vote FOR the Transaction in advance of the deadline of 10:00 a.m. (Vancouver Time) on October 7, 2024.

Unitholder Meeting

On September 3, 2024, the Fund filed a management information circular (the "Circular") and related meeting materials (collectively with the Circular, the "Meeting Materials") in connection with the Fund's special meeting of unitholders (the "Meeting") scheduled to be held at Suite 300, 171 West Esplanade, North Vancouver, British Columbia, V7M 3K9 on October 8, 2024 at 10:00 a.m. (Vancouver Time). Unitholders have the option of listening to the Meeting via teleconference at 1-437-781-4585 (Canada) or 1-617-675-4444 (United States), PIN 724 785 712 1793#. Unitholders listening to the Meeting via teleconference will not be permitted to vote, ask questions or otherwise participate at the Meeting. The Meeting Materials are available on the SEDAR+ profile of the Fund at www.sedarplus.ca and on the Fund's website at https://awincomefund.ca/investors/special-meeting-2024. Unitholders are encouraged to review the Meeting Materials prior to voting on the Transaction.

Election Deadline

Under the terms of the Transaction, each unitholder can elect to receive in exchange for each unit of the Fund:

• $37.00 in cash (representing a premium of 30% to the closing trading price of the units on the Toronto Stock Exchange of $28.54 on July 19, 2024, the last trading day prior to the public announcement of the Transaction) (the "Cash Consideration");
• one common share (an "A&W Food Services NewCo Share") of A&W Food Services NewCo (the "Share Consideration"); or
• a combination of 32.54277% of the Cash Consideration (being $12.040825) and 67.45723% of the Share Consideration (being 0.6745723 of an A&W Food Services NewCo Share).

The elections of unitholders to receive Cash Consideration or Share Consideration will be subject to proration in the event that unitholders elect, in the aggregate, to receive more or less than $175.6 million in cash consideration, such that in all cases, a total of 4,746,582 units will be purchased for cash at $37.00 per unit, representing approximately 32.5% of the outstanding units as of July 19, 2024. Unitholders electing Combination Consideration will not be subject to further proration.

Unitholders are reminded that, in order to make a valid election (a) as to the form of consideration they wish to receive under the Transaction and, if applicable, (b) to be able to receive any A&W Food Services NewCo Shares on a wholly or partially tax-deferred basis for Canadian federal income tax purposes, unitholders must sign and return the letter of transmittal and election form and make a valid election thereunder and return it with accompanying certificate(s) or direct registration statements(s) representing their units to the depositary for the Transaction prior to 5:00 p.m. (Vancouver Time) on October 4, 2024 (the "Election Deadline"). Unitholders that hold their units through an intermediary, such as a broker or investment dealer, will not receive a letter of transmittal and election form and should contact their intermediary for instructions and assistance and carefully follow any instructions provided by such intermediary. If a unitholder does not make proper election prior to the Election Deadline, they will be deemed to have made an election to receive the Share Consideration in respect of each unit held, or, only to the extent of any deemed election to receive Cash Consideration as a result of proration (as further described in the Circular), the Cash Consideration, and will not be eligible to receive any Share Consideration on a tax-deferred basis.

Unitholder Questions and Voting Assistance

For any questions or requests for voting assistance, please contact the Fund's proxy solicitation agent, Laurel Hill Advisory Group, by telephone at 1-877-452- 7184 (North American Toll Free) or 1-416-304-0211 (Outside North America), or by email at [e-mail].

About A&W Revenue Royalties Income Fund

A&W Revenue Royalties Income Fund is a limited purpose trust established to invest in Trade Marks, 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 QSR 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 A&W Food Services to use its trade-marks, Trade Marks (through the Partnership) is entitled to royalties equal to 3% of the gross sales reported by A&W restaurants in the Royalty Pool.

The Royalty Pool is adjusted annually to reflect gross sales from new A&W restaurants added to the Royalty Pool, net of the gross sales of any A&W restaurants in the Royalty Pool that have permanently closed. Additional LP units are issued to A&W Food Services to reflect the annual adjustment. A&W Food Services' additional LP units are exchanged for additional common shares of Trade Marks which are exchangeable for Trust Units. The 22nd annual adjustment to the Royalty Pool took place on January 5, 2024 at which time the number of restaurants in the Royalty Pool increased from 1,037 to 1,047.

Trade Marks' dividends to A&W Food Services and the Fund and the Fund's distributions to unitholders are based on 3% of top-line revenues of the A&W restaurants in the Royalty Pool, less cash expenses including interest, general and administrative expenses and current income taxes of Trade Marks.

About A&W Food Services

A&W is a leading QSR and the second largest burger chain in Canada with a 68-year history of service excellence, menu innovation and value creation. Operating coast-to-coast and serving over 197 million guests annually, A&W restaurants feature famous trade-marked menu items such as The Burger Family^®, Chubby Chicken^® and A&W Root Beer^®.

® trademark of A&W Trade Marks Limited Partnership, used under license.

Forward-looking Information:

Certain statements in this press release contain forward-looking information within the meaning of applicable securities laws in Canada. The forward-looking information in this press release includes, but is not limited to, expectations regarding the Meeting and the expected benefits of the Transaction, including, without limitation, expectations with respect to A&W Food Services NewCo's potential for growth and value creation. The words "expects", "plans", "will", and similar expressions are often intended to identify forward-looking information, although not all forward-looking information contains these identifying words.

This forward-looking information is based on a number of assumptions that, while considered reasonable as of the date such statements are made, are subject to known and unknown risks, uncertainties and other factors that may cause the actual results to be materially different from those expressed or implied by such forward-looking information. Such assumptions include, but are not limited to: the Fund's ability to obtain unitholder approval, TSX approval and court approval and consummate the Transaction on the terms and conditions currently contemplated; and that A&W Food Services NewCo will be successful in executing its business strategies and pursuing its growth opportunities.

Inherent in forward-looking information are risks and uncertainties beyond management's or the Fund's or A&W Food Services' ability to predict or control that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. The forward-looking information in this press release is subject to, among others, the specific risks and uncertainties relating to the Transaction and the A&W Food Services NewCo Shares set out in the Circular under "Risk Factors" and the risk factors relating to the business of A&W Food Services NewCo set out in the Circular under "Information Concerning A&W Food Services NewCo After Giving Effect to the Transaction", in addition to the other information contained, or incorporated by reference, in the Circular. Readers are cautioned that the risk factors referred to above are not exhaustive and additional risks and uncertainties, including those currently unknown or considered immaterial to Fund may also adversely effect the Transaction, the A&W Food Services NewCo Shares or A&W Food Services NewCo following completion of the Transaction. There can be no assurance that forward-looking information contained in this press release will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information.

The forward-looking information contained in this press release is based on the beliefs of the Fund and A&W Food Services' management as well as on assumptions which such management believes to be reasonable based on information available at the date hereof and is subject to change after such date. All forward-looking information in this press release is qualified in its entirety by this cautionary statement and, except as required by law, the Fund and A&W Food Services undertake no obligation to revise or update any forward-looking information as a result of new information, future events or otherwise after the date hereof.

SOURCE A&W Revenue Royalties Income Fund

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