Feb. 9, 2011 (Canada NewsWire Group) --
BURLINGTON, ON, Feb. 9 /CNW/ - SIR Royalty Income Fund (TSX: SRV.UN) ("the Fund") today declared a cash distribution of $0.083 per trust unit for the period January 1, 2011 to January 31, 2011. The distribution will be payable on February 28, 2011 to unitholders of record at the close of business on February 18, 2011.
The cash distribution of $0.083 per trust unit reflects the obligation of the Fund to make tax payments as a result of certain legislative changes to the tax treatment of income trusts, commonly referred to as Specified Investment Flow Through Tax ("SIFT Tax"), effective January 1, 2011. As announced in August 2010, the Fund continues to operate as an income trust. The SIFT tax applies to the Fund at the estimated prevailing corporate tax rate of approximately 28.25% for 2011 and, as a result, cash available for the Fund to distribute to Unitholders is reduced by that amount.
The aforementioned distribution to Unitholders for the period January 1 to January 31, 2011 (payable February 28, 2011) is the first distribution to be affected by the implementation of the SIFT Tax.
Beginning with the aforementioned distribution for January 1 to January 31, 2011 (payable February 28, 2011), cash distributions to Unitholders are classified for tax purposes as eligible dividends. Unitholders who are Canadian residents and hold their Units in a non-tax deferred account may claim the dividend tax credit for eligible dividends, which would if applicable reduce the after tax impact of the SIFT Tax. Unitholders are advised to consult their own tax advisors to determine the impact of this change in tax laws on the distributions from their investment in the Fund.
About SIR Corp.
SIR is a privately held Canadian corporation that owns and operates a portfolio of 46 restaurants in Canada. SIR's concept brands include: Jack Astor's Bar and Grill®, with 30 locations; Alice Fazooli's!®, with five locations; and Canyon Creek Chop House®, with eight locations. SIR also operates one-of-a-kind "signature" brands in downtown Toronto, which comprise the upscale reds®, Far Niente®/FOUR™/ Petit Four™, and the Loose Moose Tap & Grill®. All trademarks related to the concept and signature brands noted above are used by SIR under a license agreement with SIR Royalty Limited Partnership in consideration for a Royalty, payable by SIR to the Partnership, equal to six percent of the revenue of the 46 restaurants currently included in the Royalty pool. For more information on SIR Corp. or the SIR Royalty Income Fund, please visit www.sircorp.com.
About SIR Royalty Income Fund
The Fund is a trust governed by the laws of the province of Ontario that receives distribution income from its investment in the SIR Royalty Limited Partnership and interest income from the SIR Loan. The Fund intends to pay distributions to unitholders on a monthly basis.
Caution concerning forward-looking statements
Certain statements in this news release may constitute "forward-looking" statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Fund to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. When used in this document, such statements are such words as "may", "will", "expect", "believe", "plan", "anticipate", "intend", "estimate" and other similar terminology. These statements reflect SIR Management's current expectations regarding future events and operating performance and speak only as of the date of this document. The Fund and SIR expressly disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statements contained herein to reflect any change in expectations with regard thereto or any changes in events, conditions or circumstances on which any statement is based, except as expressly required by law.
In formulating the forward-looking statements contained herein, Management has assumed that business and economic conditions affecting SIR's restaurants and the Fund will continue substantially in the ordinary course, including without limitation with respect to general industry conditions, general levels of economic activity (including in downtown Toronto), regulations (including those regarding employees, food safety, tobacco and alcohol), weather, taxes, foreign exchange rates and interest rates, that there will be no pandemics or other material outbreaks of disease or safety issues affecting humans or animals or food products, and that there will be no unplanned material changes in its facilities, equipment, customer and employee relations, or credit arrangements. These assumptions, although considered reasonable by Management at the time of preparation, may prove to be incorrect. For more information concerning the Fund's risks and uncertainties, please refer to the Fund's periodic interim filings, and/or its March 31, 2010 Annual Information Form.
|Peter Fowler |
Tel: (416) 815-0700 ext. 257