PDM Royalties Income Fund announces change to the operating period for new restaurants added to the royalty pool



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    SERVICES/

    MONCTON, NB, Oct. 15 /CNW/ - PDM Royalties Income Fund (the "Fund")
(TSX: PDM.UN) announced today amendments to its licence and royalty agreements
with Pizza Delight Corporation Ltd. ("PDC") and Mikes Restaurants Inc.
("Mikes") that remove the requirement that a restaurant be open for at least
90 consecutive days (the "Operating Period") before it may be included in the
royalty pool for the subsequent year on January 1st of each year when the
royalty pool is adjusted. Prior to this change, restaurants opened after
October 3rd in a given year would not be included in the royalty pool until
January 1st of the second following year.
    The elimination of the requirement that restaurants be open for the
Operating Period to be eligible for inclusion in the royalty pool was
recommended to the Fund by the directors of PDM Restaurants GP Inc. ("PDM
GP"), the managing partner of PDM Royalties Limited Partnership, administrator
of the Fund. Three of the five directors of PDM GP are independent of PDC and
Mikes. The change will affect the determination of the royalty pool as at
January 1, 2008 and in subsequent years. The adjustment to the royalty pool to
occur on January 1, 2008 will therefore include all new restaurants opened
between October 4, 2006 and December 31, 2007. During the period of October 4,
2006 to date, 14 new restaurants have been opened, comprised of one Pizza
Delight(R) restaurants, 1 Mikes(R) restaurants, 8 Scores(R) restaurants and
4 Baton Rouge(R) restaurants. It is anticipated that 4 additional restaurants
will be opened by December 31, 2007. On January 1st in each year after
January 1, 2008, restaurants opened between January 1st and December 31st of
the prior year will be included in the royalty pool.
    Consequential amendments were made to the amended and restated limited
partnership agreement among PDC, Mikes, PDM GP and PDM Holdings Trust to give
effect to this change.

    About the Fund

    The Fund is a limited purpose open-ended trust established under the laws
of Ontario. The Fund makes monthly distributions of its available cash to
holders of units. The Fund indirectly owns the trade marks and intellectual
property for the Pizza Delight(R) and Mikes(R) brands and has licensed them to
PDC and Mikes, respectively, in consideration for a royalty equal to 4% of
system sales generated by Pizza Delight(R) and Mikes(R) restaurants. The Fund
also indirectly owns the trade marks and intellectual property for the
Scores(R) Rôtisserie and Ribs and Baton Rouge(R) brands and has licensed each
to Mikes in consideration for a royalty equal to 6% of system sales generated
by Scores(R) Rôtisserie and Ribs and Baton Rouge(R) restaurants.

    About PDC

    PDC is a privately owned corporation, headquartered in Moncton, New
Brunswick. It operates franchised and corporate restaurants under the brand
names Pizza Delight(R), Mikes(R), Scores(R) Rôtisserie and Ribs and Baton
Rouge(R). Pizza Delight(R) restaurants operate primarily in Atlantic Canada,
where PDC dominates the family/mid-scale segment. Mikes(R) restaurants operate
primarily in Québec in the casual dining segment and the take-out and delivery
segments. Scores(R) Rôtisserie and Ribs restaurants operate primarily in
Québec in the family dining segment and the take-out and delivery segments.
Baton Rouge(R) restaurants operate in the casual dining segment in Ontario and
Québec.
    For additional information on our four brands visit:
    www.pizzadelight.com, www.mikes.ca, www.scores.ca or
    www.batonrougerestaurants.com.
    %SEDAR: 00018600E




For further information:

For further information: William Lane, CMA, Chief Financial Officer, PDM
Royalties Income Fund, (506) 853-0990, blane@pizzadelight.ca

Organization Profile

PIZZA DELIGHT CORPORATION LTD. (PDC)

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PDM ROYALTIES INCOME FUND

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