SIR Corp. Announces Amendment to Debt Financing

BURLINGTON, ON, Nov. 25, 2011 /CNW/ - SIR Corp. ("SIR"), which has a number of agreements and interests related to SIR Royalty Income Fund (the "Fund") (TSX:  SRV.UN), announced today that it has entered into a First Amendment to the Amended and Restated Loan Agreement ("Amendment") that was negotiated August 26, 2011 ("Credit Agreement") with its existing senior lender GE Capital to extend and make coterminous the terms of the $12.0 million Development Loan and the $26.0 million Term Loan. Under the terms of the Amendment, the term of the $26.0 million Term Loan negotiated November 13, 2009 will be extended from November 14, 2012 to November 14, 2016 and the term of the Development Loan which was negotiated August 26, 2011, will be extended from August 26, 2016 to November 14, 2016. Additionally, under the terms of the Amendment the variable interest rate of the Term Loan is reduced to the same rate as that of the Development Loan. A copy of the Amendment will be filed on SEDAR.

The Development Loan is available to enable SIR to finance: (a) costs incurred in connection with the acquisition of furniture, fixtures, equipment and leasehold improvements relating to new locations, and (b) renovations and capital expenditure costs relating to existing locations.

Peter Fowler, President and CEO of SIR Corp., stated, "These extensions further enhance our senior debt facilities with GE Capital, the purpose of which are to finance prudent growth through building new corporately owned restaurants, as well as renovation programs for existing restaurants. We plan to build on our successful concepts, locating some of these new restaurants outside the Greater Toronto Area, which will both improve our geographic diversification and reduce per restaurant overhead. With a greater number of restaurants, funds available for marketing should also increase, helping further drive sales growth. Moreover, renovations of existing restaurants are typically followed by increased sales.  While not without risk (see below), all of these factors are expected to benefit both SIR Corp. and, ultimately, the unitholders of the Fund."

The financial covenants applicable to SIR, including a minimum fixed charge coverage ratio and senior debt leverage ratio, remain the same. The loan is secured by substantially all of the assets of SIR and most of its subsidiaries, which are also guarantors. The SIR Royalty Limited Partnership (the "Partnership") and the Fund have not guaranteed the loan, but have, as contemplated in  existing agreements, agreed to continue to subordinate and postpone their claims against SIR to the claims of GE Capital.

About SIR Corp.
SIR is a privately held Canadian corporation that owns and operates a portfolio of 48 restaurants in Canada. SIR's concept brands include: Jack Astor's Bar and Grill®, with 32 locations; Alice Fazooli's!®, with five locations; and Canyon Creek Chop House®, with eight locations. SIR also operates one-of-a-kind "signature" brands in downtown Toronto, which comprise the upscale reds®, Far Niente®/FOUR®/ Petit Four®, and the Loose Moose Tap & Grill®. All trademarks related to the concept and signature brands noted above are used by SIR under a license agreement with SIR Royalty Limited Partnership in consideration for a Royalty, payable by SIR to the Partnership, equal to six percent of the revenue of the 46 restaurants currently included in the Royalty pool.

About SIR Royalty Income Fund  
The Fund is a trust governed by the laws of the province of Ontario that receives distribution income from its investment in the SIR Royalty Limited Partnership and interest income from the SIR Loan. The Fund intends to pay distributions to unitholders on a monthly basis

Caution concerning forward-looking statements
Certain statements in this news release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Fund to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  When used in this document, such statements are such words as "may", "will", "expect", "believe", "plan", "anticipate", "intend", "estimate" and other similar terminology.  These statements reflect SIR Management's current expectations regarding future events and operating performance and speak only as of the date of this document.  The Fund and SIR expressly disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statements contained herein to reflect any change in expectations with regard thereto or any changes in events, conditions or circumstances on which any statement is based, except as expressly required by law. 

In formulating the forward-looking statements contained herein, Management has assumed that business and economic conditions affecting SIR's restaurants and the Fund will continue substantially in the ordinary course, including without limitation with respect to general industry conditions, general levels of economic activity (including in downtown Toronto), regulations (including those regarding employees, food safety, tobacco and alcohol), weather, taxes, foreign exchange rates and interest rates, that there will be no pandemics or other material outbreaks of disease or safety issues affecting humans or animals or food products, and that there will be no unplanned material changes in its facilities, equipment, customer and employee relations, or credit arrangements. These assumptions, although considered reasonable by Management at the time of preparation, may prove to be incorrect.  For more information concerning the Fund's risks and uncertainties, please refer to the Fund's periodic interim filings, and/or its March 31, 2011 Annual Information Form.

Additional information related to SIR, the Partnership and the Fund can be found at www.sedar.com

This document is being placed on www.sedar.com by SIR Corp. on a voluntary basis. It is not being placed by, or with the approval of, or on behalf of the SIR Royalty Income Fund, or any of its trustees or officers, or by SIR GP Inc., or SIR Holdings Trust, or their respective trustees, managing general partners, directors or officers, has not been approved by any of them, and is not to be regarded as a document placed, filed, furnished or submitted by, or on behalf of any of them, or by anyone with actual, implied or apparent authority to act on behalf of any of them. None of them has approved, authorized, permitted or acquiesced to the contents of this document.

SOURCE SIR ROYALTY INCOME FUND

For further information:

Jeff Good Lawrence Chamberlain
Chief Financial Officer          Investor Relations
SIR Corp. Tel: (416) 815-0700 ext. 257
Tel: 905-681-2997 Email: lchamberlain@equicomgroup.com

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