Boston Pizza Royalties Income Fund Announces Intention to Make Normal Course Issuer Bid

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 21, 2009) - Boston Pizza Royalties Income Fund (the "Fund") (TSX:BPF.UN) announced today that it has received Toronto Stock Exchange ("TSX") approval of a Notice of Intention to Make a Normal Course Issuer Bid through the facilities of the TSX from October 1, 2009 to no later than September 30, 2010. The Normal Course Issuer Bid will permit the Fund to repurchase for cancellation up to 1,201,783 units, being approximately 8.4% of the Fund's issued and outstanding units (as at September 18, 2009) and approximately 10.0% of its public float, currently comprised of 12,017,833 units. The Fund has 14,360,014 units issued and outstanding as at September 18, 2009. The average daily trading volume of the Fund's units for the period between March 1, 2009 and August 31, 2009 was 25,334 units. In accordance with the rules of the TSX, the maximum number of units that can be purchased on a daily basis by the Fund is 6,333 units, subject to the block purchase exception.

The board of trustees of the Fund believes that current market conditions provide opportunities for the Fund to acquire units at attractive prices and that the purchases are an appropriate use of funds and will enhance unitholder value.

The Fund intends to finance purchases under the Normal Course Issuer Bid by drawing on the $20 million credit facility previously established by a subsidiary of the Fund, Boston Pizza Royalties Limited Partnership (the "Partnership"), with a Canadian Chartered Bank (the "Lender") for the purpose of funding purchases of units under normal course issuer bids (the "NCIB Credit Facility"). The NCIB Credit Facility bears interest at variable rates, comprised of either or a combination of the bank's prime rate plus 0.50% per annum or bankers' acceptance rates plus 2.00%, and has a maturity date of September 22, 2012. The Partnership had currently drawn down the NCIB Credit Facility by $11.4 million.

The Fund has established an automatic securities purchase plan with its broker, BMO Nesbitt Burns Inc., to allow for the repurchase of Fund units under the Normal Course Issuer Bid at any time, including when it ordinarily would not be active in the market due to its own internal trading blackout periods, insider trading rules or otherwise. The plan will terminate on the earliest of: (a) the date on which the purchase limits specified in the plan have been attained, (b) the date on which the Normal Course Issuer Bid terminates, (c) the Fund terminates the plan in accordance with the terms of the plan, in which case the Fund will issue a press release announcing such termination, and (d) September 30, 2010. All purchases will be made on the open market through the facilities of the TSX in accordance with the requirements of the TSX.

The Fund previously established a Normal Course Issuer Bid (the "2008 NCIB"), pursuant to which it was permitted to repurchase for cancellation up to 1,336,154 Units through the facilities of the TSX. Purchases under the 2008 NCIB commenced on October 1, 2008 and were completed on February 23, 2009 as a result of the Fund having acquired 1,336,154 Units, being the maximum number of units permitted under the 2008 NCIB, at an average price of $8.54 per unit. The Fund paid the market price at the time of acquisition for units purchased through the facilities of the TSX and all units acquired under the 2008 NCIB were cancelled. As a result of the repurchase and cancellation of units under the 2008 NCIB, there is a savings for the Fund in overall monthly cash distributions to unitholders that is partially offset by interest expense and the administrative costs of establishing the 2008 NCIB. At the current annualized distribution rate of $1.38 per Fund unit, the 1,336,154 Fund units acquired under the 2008 NCIB represent distribution savings of $1.8 million per year. At the prevailing interest rate on the NCIB Credit Facility of approximately 2.4%, the interest cost on the NCIB Credit Facility balance of $11.4 million is $0.2 million per year. The difference of $1.6 million per year, represents an accretive benefit to existing unitholders of $0.0876 per Fund unit per year as a direct result of the 2008 NCIB.

The Fund is a limited purpose, open-ended trust established under the laws of British Columbia to acquire indirectly certain trade marks and trade names used by Boston Pizza International Inc. ("BPI") in its Boston Pizza restaurants in Canada. The trade marks are licensed to BPI for 99 years for which BPI pays the Fund 4% of franchise revenues of its 323 Boston Pizza restaurants in the royalty pool.

The trustees of the Fund approved the contents of this news release.


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