A&W REVENUE ROYALTIES INCOME FUND AND A&W FOOD SERVICES OF CANADA INC. ANNOUNCE SECONDARY BOUGHT DEAL OFFERING OF UNITS
February 09 2011 - 5:42PM
PR Newswire (Canada)
VANCOUVER, Feb. 9 /CNW/ -- Toronto Stock Exchange: AW.UN VANCOUVER,
Feb. 9 /CNW/ - A&W Revenue Royalties Income Fund (the "Fund")
and A&W Food Services of Canada Inc. ("Food Services") announce
that the Fund and Food Services have entered into an agreement with
CIBC and National Bank Financial Inc. and a syndicate of
underwriters (collectively, the "Underwriters") to complete a
secondary bought deal offering of units of the Fund ("Units").
Under the agreement, the Underwriters will purchase 2,997,000 Units
at a purchase price of $23.35 per Unit for gross proceeds of
$69,979,950. The Units are being sold by Food Services. The Fund
will not receive any proceeds from the offering. The offering will
be made pursuant to a short form prospectus to be filed with
securities regulators in each of the provinces of Canada. The
offering is expected to close on or about March 2, 2011. Closing is
subject to a number of customary conditions, including receipt of
all necessary regulatory approvals. Food Services currently owns
securities indirectly exchangeable for 4,247,358 Units (the
"Exchangeable Securities"), representing a 34% indirect interest in
the Fund. Prior to closing of the offering, Food Services will
exchange only 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 will own Exchangeable
Securities indirectly exchangeable for 1,250,358 Units, or
approximately a 10% indirect interest in the Fund. This press
release shall not constitute an offer to sell or the solicitation
of an offer to buy, which may be made only by means of the
prospectus, nor shall there be any sale of the Units in any state,
province or other jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the securities laws of any state, province or jurisdiction. The
Units have not been, and will not be registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold
in the United States absent registration or compliance with an
applicable exemption from the registration requirement under U.S.
securities laws. 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)
receives royalties equal to 3% of the sales of A&W restaurants
in the Royalty Pool. Food Services is the second largest
quickservice 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. Food Services
currently owns 34% of the common shares of TMI, and therefore
currently owns the equivalent of 34% of the Units of the Fund on a
fully-diluted basis. 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/February2011/09/c9473.html
pbContact/bbr/ Don Leslie, Chief Financial Officer: (604) 988-2141
or a
href="mailto:investorrelations@aw.ca"investorrelations@aw.ca/a/p
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