Reaches agreement for restaurants up for franchise renewal in 2009 and 2010
TORONTO, Nov. 26 /CNW/ - Priszm Income Fund (TSX: QSR.UN) ("Priszm" or the "Company") today announced that it has extended several franchise agreements with Yum! Restaurants International (Canada) ("Yum" or the "Franchisor") to operate KFC, Taco Bell and Pizza Hut restaurants in many locations across Canada.
These agreements are the first in a series that will extend Priszm's franchise contracts and upgrade its system. Priszm currently has 120 restaurants that meet Yum's current brand and image standards and today the Company has come to terms on an additional 75 restaurants.
Of the 120 restaurants that currently meet the Franchisor's standards, the renewal agreements will enable the Company to extend its right to use the KFC, Taco Bell or Pizza Hut trademarks, where applicable, for an additional 10-year term on 69 of those restaurants until 2019. The remaining agreements have various expiries over the next nine years.
Priszm also announced today that it has reached further agreement with Yum on the renewal terms for 10-year franchise contracts covering 75 additional restaurants. These restaurants, once renewed, will have a franchise term ending in 2020. The renewal of these restaurants will require a capital investment of between $15-16.5 million in 2010.
By the end of 2010, Priszm will have more than 150 restaurants with long term franchise agreements in place and 195 restaurants that meet the Franchisor's current brand and image standards. Renewals of the franchise agreements on the balance of the restaurants will be announced in the future upon completion of negotiations with Yum.
Priszm will close 16 underperforming stores before the end of 2010.
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 1 million customers a week and employ approximately 7,400 people. Currently, more than 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 agreement, the industry sector performance, business plans, activities, 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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