Prime Restaurants Royalty Income Fund

Prime Restaurants Royalty Income Fund

February 18, 2010 17:34 ET

Prime Restaurants Royalty Income Fund Announces February 2010 Cash Distribution

MISSISSAUGA, ONTARIO--(Marketwire - Feb. 18, 2010) - Prime Restaurants Royalty Income Fund (TSX:EAT.UN) announced today that it has declared a cash distribution of $0.04 per trust unit for the period February 1 to February 28, 2010. The distribution will be made on March 15, 2010 to Unitholders of record at the close of business on February 28, 2009.

Due to the difficult operating environment, Prime Restaurants of Canada ("PRC") has requested that PRC Trademarks Inc. ("TradeMarkCo") defer collecting a portion of the royalty payable to it from PRC in the month of March 2010 under the Amended and Restated License and Royalty Agreement dated March 13, 2008 (the "Royalty Agreement"). TradeMarkCo has agreed to defer collecting a portion of the royalty payable in the month of March and to refrain from taking any actions under the Royalty Agreement until March 31, 2010 (or earlier in certain limited circumstances). This will not prejudice TradeMarkCo's rights and remedies after March 31, 2010 in respect of all amounts payable under the Royalty Agreement. In connection with the foregoing, the Fund has notified TradeMarkCo that it will waive a portion of the interest that otherwise would have been owing on the notes of TradeMarkCo held by the Fund in the month of March 2010, which is the source of cash for distributions to Unitholders.

About the Royalty Income Fund

The Fund is a limited purpose trust authorized to issue an unlimited number of Trust Units ("Units") and established to invest in TradeMarkCo. The source of revenue for the Fund is through its ownership in, and debt instrument issued by, TradeMarkCo. The Fund receives interest income on the TradeMarkCo Note which it distributes to its Unitholders. TradeMarkCo owns certain trade-marks and licenses their use to PRC, which operates and franchises the restaurant and bar business. In return, TradeMarkCo receives royalty income from the royalty pooled restaurants operated and franchised by PRC.

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