09:14:42 EDT Tue 24 May 2022
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SIR Royalty Income Fund
Symbol SRV
Shares Issued 8,375,567
Close 2022-01-27 C$ 12.48
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SIR Royalty investment to receive 6% Renegade royalty

2022-01-28 10:20 ET - News Release

Mr. Peter Fowler reports


The independent fund trustees of SIR Royalty Income Fund have provided approval to SIR Corp. to operate the Renegade Chicken takeout and delivery service on a trial basis in certain Jack Astor's locations in Ontario. The approval will be operative while dine-in operations are restricted or limited, but in any event until March 31, 2022, at SIR's option. In exchange, SIR has agreed to pay an amount equal to 6 per cent of the revenue related to these trial Renegade Chicken operations to the SIR Royalty LP. SIR is currently operating Renegade Chicken takeout and delivery service out of 21 Jack Astor's locations in Ontario. As this is a trial, no trademarks are being transferred.

"Operating Renegade Chicken out of these Jack Astor's locations during this time of restricted in-restaurant dining will not impact the current operations of Jack Astor's, rather it helps us to optimize revenue for the benefit of all our stakeholders, including our hospitality personnel. While the fund has no ownership interest in the Renegade Chicken trademark, the agreed payment to be made to the partnership will similarly provide value to fund unitholders," said Peter Fowler, chief executive officer of SIR. "Once we have more insight into the long-term viability of Renegade Chicken and greater certainty with regards to a return to a more normalized operating environment for Jack Astor's, we intend to consider the next steps for Renegade Chicken."

Renegade Chicken is a takeout and delivery concept that SIR launched in a test phase in late 2020 in an attempt to increase sales volume and help ensure the survival of SIR during the pandemic. It was intended as a ghost kitchen concept that, while increasing the volume of food produced in the initial test locations (certain Jack Astor's and Duke's Refresher & Bar locations), was specifically designed and marketed as distinctly different from Jack Astor's. Effective June 1, 2021, SIR temporarily ceased all Renegade Chicken operations within its Jack Astor's locations, but continued to operate Renegade Chicken at its Duke's Refresher & Bar location in the St. Lawrence Market neighbourhood in downtown Toronto, which is not part of the fund's royalty pool.

SIR believes that Renegade Chicken has multiunit growth potential and could eventually be considered, among other things, as a potential new concept brand for inclusion in the fund's royalty pool if it is successful in exceeding $12-million in annualized revenue. However, there can be no assurance as to the future of the Renegade Chicken concept.

About SIR Royalty Income Fund

SIR Royalty is a trust governed by the laws of Ontario that receives distribution income from its investment in the SIR Royalty LP and interest income from the SIR loan. The fund intends to pay distributions to unitholders on a monthly basis.

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