Income Fund Structure

The Fund earns equity income from its investment in the Partnership and interest income on a $30 million loan to Pizza Pizza Limited (the “PPL Loan”). The Fund´s equity income from the Partnership is calculated as the royalty income less the Partnership´s operating expenses less earnings attributable to Pizza Pizza.

The Fund´s interest income on the PPL Loan is calculated at 6% per annum, payable monthly. The Fund, indirectly through the Partnership, earns royalty income equal to 6% of the Royalty Pool system sales of the Pizza Pizza restaurants.

The Partnership´s operating expenses include administrative expenses, deferred financing fees and interest paid on a $47 million bank term loan.

Pizza Pizza´s interest in the earnings of the Partnership is from its ownership in Class B and Class C Partnership units. Subject to the Subordination Agreement, each Class B Unit can be exchanged indirectly for that number of units equal to the Class B Exchange Multiplier as defined in the Licence and Royalty Agreement applicable at the date of the exchange. Class C Units can be exchanged by requiring the Trust to purchase those Class C Units in consideration of the assumption by the Trust of an amount of the indebtedness under the PPL Loan equal to $10.00 per Class C Unit to be transferred.