TORONTO, Jan. 19 /CNW/ - Priszm Income Fund (TSX: QSR.UN) ("Priszm" or
the "Company") reported today that the Company has executed a
forbearance agreement to extend the maturity date of its senior debt
facility, including the payment of all interest accrued but unpaid to
January 31, 2011. In addition the senior debt lender will temporarily
suspend action to exercise its remedies for the Company's defaults in
respect of the existing terms of its senior debt facility. As part of
the agreement, the Company is not permitted to make payments in respect
of obligations that are subordinated to the senior debt facility, other
than those relating to the direct operation of the business in ordinary
The senior debt lender and the Company also executed a separate
short-term financing agreement that provides the Company a supplemental
facility of up to $4 million to ensure the business has sufficient
liquidity to continue operations while a longer-term plan is
developed. The facility bears interest of 10% per annum with a maximum
one draw per week and matures January 31, 2011.
The Company remains in discussions with its senior debt lender and
franchisor on various options to restructure the business which may
include the sale of all assets. The Company's interim agreement with
its franchisor, YUM! Restaurants International, with respect to the
franchise agreements for 70 restaurants expired on January 15, 2011 as
did its interim agreement to defer unpaid continuing fees. The Company
continues to work with the two key stakeholders to come to both short
and long-term resolutions that are mutually satisfactory.
About Priszm Income Fund
Priszm Income Fund (TSX: QSR.UN) holds approximately a 60 per cent
interest in Priszm Limited Partnership, which owns and operates more
than 400 quick service restaurants in seven provinces across Canada.
The KFC, Taco Bell and Pizza Hut restaurants under Priszm serve more
than one million customers a week and employ approximately 7,300
people. Approximately 100 locations are multi-branded, combining two or
more of the Fund's restaurant concepts.
To find out more about Priszm Income Fund (TSX: QSR.UN), visit our
website at http://www.priszm.com.
Certain information in this document may constitute forward-looking
statements within the meaning of securities laws that involve known and
unknown risks, uncertainties, future expectations and other factors
with respect to industry sector performance, business plans,
activities, trends and events anticipated by the Priszm Income Fund
(the "Company") and which may cause the Company's future performance
and results to be materially different from those implied by the
forward-looking information. In some cases, forward-looking statements
can be identified by terminology such as "may," "will," "should,"
"expect," "plan," "anticipate," "believe," "estimate," "predict,"
"potential," "continue," or the negative of these terms or other
comparable terminology concerning matters that are not historical
facts. Forward-looking information is based on certain factors and
assumptions regarding, among other things, the number of restaurants,
the renewal of the franchise agreements, ability to meet capital
expenditure requirements, the industry sector performance, business
plans, activities, success of refinancing on commercially viable terms,
trends and events anticipated by the Company. Although the Company
believes that the assumptions underlying such statements are
reasonable, any of the assumptions may prove to be inaccurate and, as a
result, the forward-looking information may prove to be incorrect. The
forward-looking information, assumptions and statements reflect the
views of the Company's management with respect to future events and
outcomes as of the date of this document and there should be no
expectation that such information will be updated, revised and/or
supplemented whether as a result of new information, changing
circumstances, future events or other cause. Actual events or outcomes
may be materially different and cause the performance of the Company to
differ materially from any forward-looking statement.
SOURCE Priszm Income Fund
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