Initial Public Offering Overview

The Fund completed its initial public offering on July 6, 2005, issuing 16,830,000 units. . The fund used the proceeds of the offering to indirectly acquire, through the Partnership, the “PPL Rights”. The Fund also acquired, directly from a bank, a loan outstanding to Pizza Pizza in the principal amount of $30 million.

On July 27, 2005, the Fund issued an additional 1,122,000 units pursuant to the exercise of the over-allotment option granted to the underwriters in connection with the FundĀ“s initial public offering. As a result of the exercise of the over-allotment by the underwriters, Pizza Pizza Limited is retaining an effective 20% interest in the Fund and an effective 20% interest in the Partnership. Pizza Pizza has agreed to maintain this 20% interest for two years (until June 30, 2007); distributions on the 20% interest will be subordinated during the two-year hold period pursuant to the terms of a subordination agreement.

Concurrent with the transfer of the PPL Rights to the Partnership, the Partnership granted a licence to Pizza Pizza for the use of the PPL Rights, for which Pizza Pizza will pay a 6% royalty to the Partnership on a monthly basis. The royalty is calculated based on the system sales of 340 traditional and 160 non-traditional quick service restaurants that were open throughout Canada on March13, 2005 (collectively the “Royalty Pool”). The initial term of this licence is 99 years.

Commencing January 1, 2006, and annually thereafter (each an “Adjustment Date”), an adjustment will be made to the Royalty Pool, to roll in new Pizza Pizza restaurants that were opened in the prior year. At each annual adjustment, the Fund will pay Pizza Pizza, in securities indirectly exchangeable for units of the Fund, 92.5% of the amount reflecting the value of any increase in the royalties at that time, less any reduction in royalties as a result of any permanent restaurant closures. The adjustment for new restaurants rolled into the Royalty Pool is designed to be accretive for current unitholders.