PDM Royalties Income Fund announces increase to royalty pool

    Estimated $1.5 million in new royalties on $22.6 million net sales

    MONCTON, NB, Feb. 18 /CNW/ - PDM Royalties Income Fund ("PDM" or the
"Fund") (TSX: PDM.UN) announced that twelve new restaurants have been added to
the royalty pool on which the Fund earns royalty revenue, while twelve
underperforming restaurants have been closed. The changes to the portfolio are
expected to generate an estimated additional $1.5 million in annual royalties
for the Fund, based on a $22.6 million estimated net sales increase as a
result of the transactions.
    As of January 1, 2009: 12 new restaurants comprised of 3 Scores, 7 Baton
Rouge, and 2 Mikes restaurants, opened during the period January 1, 2008
through December 31, 2008, were added to the royalty pool on which the Fund
earns royalty revenue. The sales from these 12 new restaurants will generate
an estimated $32.8 million in annual sales.
    Imvescor Inc. (Imvescor), the related franchisor that manages the Pizza
Delight, Mike's, Scores and Baton Rouge restaurant brands, closed 12
restaurants with annual sales of $10.2 million. The closed locations included
8 Mikes, 3 Pizza Delight, and 1 Scores restaurants.
    Following these transactions, the pool of restaurants generating revenues
for PDM will remain at 259 locations.
    The Fund will compensate Imvescor for the increased revenue stream based
on a formula set out in the License agreement. There is a 7.5% discount
applied to the value of the revenues which provides added value to the
existing unitholders. The consideration to Imvescor will represent the
equivalent of 1,012,936 units increasing the retained interest by 9.5% (7.8%
on a fully diluted basis). This amount will be adjusted at December 31, 2009
once the actual sales for the new restaurants are determined.
    In addition, the adjustment to the January 2008 addition of restaurants
to the royalty pool has now been finalized. The actual annual sales for 2008
for the new restaurants added on January 1, 2008 were $44.9 million compared
to the original estimate of $48.8 million. Due to the sales variance, the unit
entitlement decreased from 1,514,862 to 1,362,694.
    The net impact of these changes increases the retained interest held by
Imvescor to approximately 3.9 million units or 37.0 percent of the Fund (30.5%
on a fully diluted basis).

    Restaurant Development

    New restaurant development at Scores and Baton Rouge was strong in 2008.
Scores has also opened its second Ontario restaurant in Mississauga and is
steadily gaining consumer acceptance. The new "Oven Fresh Kitchen" Pizza
Delight concept and "Trattoria" Mikes has met with excellent consumer support
and the franchisees for each brand have started to commit to renovations with
eight Pizza Delights and twelve Mikes completed.
    Imvescor intends to open new restaurants and carry out renovations in
2009; however, actual numbers will depend on market conditions in Imvescor's
chosen markets. Development of new restaurants in 2009 will be focused in
Ontario and Quebec. Renovations of existing restaurants will be focused on the
Pizza Delight and Mike's brands, primarily in Atlantic Canada and Quebec.

    About PDM Royalties Income Fund

    PDM Royalties Income 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),
Mikes(R), Scores(R) and Baton Rouge(R) brands and has licensed them to
Imvescor in consideration for a royalty equal to 4% of system sales for Pizza
Delight and Mikes, and in the case of Scores and Baton Rouge, the royalty rate
is 6%.

    About Imvescor

    Imvescor is a privately owned corporation, headquartered in Moncton, New
Brunswick. It operates franchised and corporate restaurants under the brand
names Pizza Delight, Mikes, Scores, and Baton Rouge restaurants. Pizza Delight
operates primarily in Atlantic Canada, where it dominates the family/mid-scale
segment. Mikes and Scores restaurants operate primarily in Quebec in the
family and casual dining segments and the take-out and delivery segments.
Baton Rouge has operations in Quebec and Ontario in the high end casual

    Forward-Looking Statements

    Certain information regarding the Fund contained herein may constitute
forward-looking statements within the meaning of applicable securities laws.
Forward-looking statements may include estimates, plans, expectations,
opinions, forecasts, projections, guidance or other statements that are not
statements of fact. Although the Fund believes that the expectations reflected
in such forward-looking statements are reasonable, it can give no assurance
that such expectations will prove to have been correct. The Fund cautions that
actual performance will be affected by a number of factors, many of which are
beyond the Fund's control, and that future events and results may vary
substantially from what the Fund currently foresees. Discussion of the various
factors that may affect future results is contained in the annual information
form of the Fund dated March 28, 2008 which is available at www.sedar.com. The
Fund's forward-looking statements are expressly qualified in their entirety by
this cautionary statement.

For further information:

For further information: Mélanie Joly, Cohn & Wolfe, Montréal, (514)
845-2257 ext 247; Or visit: www.pdmfund.ca, www.imvescor.ca,
www.pizzadelight.ca, www.mikes.ca, www.scores.ca,

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