Lembit Janes Provides Update on Efforts to Reconstitute Board of Trustees of SIR Royalty Income Fund

• Significant Support Voiced by Unitholders

TORONTO, May 20, 2021 /CNW/ - Lembit Janes provides an update to unitholders of SIR Royalty Income Fund (TSX: SRV.UN) (the "Fund") regarding his plans announced on April 12, 2021 to reconstitute the board of trustees of the Fund (the "Board"). Mr. Janes also wishes to thank the numerous unitholders who have contacted him on an unsolicited basis to voice their support for his actions. He is grateful for such strong and vocal support by unitholders who share his concerns regarding the direction of the Fund and the actions of its trustees.

Attempt to Reach an Agreement to Reconstitute Board Fails

Mr. Janes, and the two other persons (namely, Stephen Dewis and Michael Fisher) he will nominate as independent trustees (together with Mr. Janes, the "Unitholder Nominees") for election at the annual general meeting of unitholders of the Fund to be held on June 29, 2021 (the "Meeting"), met virtually with representatives of SIR Corp. ("SIR") and the Fund on April 29, 2021 in order to exchange views and understand more fully each side's perspectives. Proposals to reconstitute the Board were then put forward by each side, including a commitment by Mr. Janes not to seek reimbursement of the expenses he had incurred in order to reconstitute the Board for the benefit of all unitholders. Notwithstanding the efforts of Mr. Janes, a compromise appears unlikely as SIR does not accept that significant Board renewal is required.  Accordingly, Mr. Janes will push forward with his plan to replace 3 of the current trustees (namely John McLaughlin, Peter Luit and William Rogers).

Mr. Janes is the Fund's largest independent unitholder as he beneficially owns or exercises control or direction over 1,646,388 units, representing approximately 19.66% of the outstanding units and 15.91% of the votes that may be cast at the Meeting.

Reasons Why Change is Required

As outlined in more detail in Mr. Janes' April 12 press release, change is required for various reasons including:

• There has been no change in the three independent trustees since the Fund's IPO in 2004.
• The decision to suspend unitholder distributions for the benefit of SIR is concerning.
• The conduct of SIR is clearly self-serving and strong independent leadership is required to protect unitholders.
• Unitholders should be entitled to a royalty on sales of Renegade Chicken, or any other products, prepared in Jack Astor's kitchens with Jack Astor's staff and utilizing Jack Astor's point-of-sale processes.
• There is a lack of transparency that appears to only be rectified on an issue by issue basis after complaints have been registered, or by sending demand letters from counsel.

Next Steps

Mr. Janes is committed to taking the necessary steps to protect the interests of all unitholders by reconstituting the Board.  In order to improve director accountability and enhance shareholder democracy, he has asked that an agreement be negotiated on a protocol for the Meeting and a form of universal proxy to be used at the Meeting. This will ensure that the Meeting will be undertaken in a fair and open manner.  So far, neither SIR nor the Fund appear willing to make such an agreement.

Mr. Janes has also retained the services of Laurel Hill Advisory Group ("Laurel Hill") to assist unitholders in voting.

Unitholders with questions should contact Laurel Hill at 1-877-452-7184 (416-304-0211 outside North America) or email [email protected].

Additional Information

The information contained in this press release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable securities laws. Although Mr. Janes intends to nominate the Unitholder Nominees and reconstitute the Board, unitholders are not being asked at this time to execute a proxy in favour of the Unitholder Nominees or any other resolution. In connection with the Meeting, Mr. Janes has not decided whether he will file a dissident information circular.

Notwithstanding the foregoing, Mr. Janes is voluntarily providing the disclosure required under section 9.2(4) of National Instrument 51-102 ? Continuous Disclosure Obligations ("NI 51-102") and has filed an information document (the "Information Document") under the Fund's profile at www.sedar.com containing the disclosure required under section 9.2(6) of NI 51-102 in respect of the Unitholder Nominees in accordance with securities laws applicable to public broadcast solicitations. Unitholders are strongly encouraged to review the Information Document.

This press release and any solicitation made by Mr. Janes in advance of the Meeting is, or will be, as applicable, made by Mr. Janes, and not by or on behalf of the management of the Fund. All costs incurred for any solicitation will be borne by Mr. Janes (directly or indirectly). Mr. Janes has entered into an agreement with Laurel Hill pursuant to which Laurel Hill has agreed to provide certain consulting and related services. Pursuant to this agreement, Laurel Hill will receive a minimum fee of $45,000 plus out-of-pocket expenses.

Mr. Janes is not soliciting proxies in connection with the Meeting at this time, and unitholders are not being asked at this time to execute proxies in favour of the Unitholder Nominees (in respect of the Meeting) or any other resolution. Any proxies solicited by Mr. Janes in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian securities laws will be conveyed by way of public broadcast, including press release, speech or publication, and by any other manner permitted under applicable Canadian laws. In addition, such solicitation may be made by mail, telephone, facsimile, email or other electronic means as well as by newspaper or other media advertising and in person by Mr. Janes or his associates or affiliates.

A registered unitholder who has given a proxy may revoke the proxy (i) by completing a proxy signed by the unitholder or by the unitholder's attorney authorized in writing bearing a later date and depositing it with the transfer agent of the Fund; (ii) by depositing an instrument of revocation in writing executed by the unitholder or by the unitholder's attorney authorized in writing: * at the head office of the Fund (namely, Suite 200, 5360 South Service Road, Burlington, Ontario L7L 5L1) at any time up to and including the last business day preceding the day of the Meeting, or any adjournment of the Meeting, or (y) with the Chairperson at the Meeting, prior to the exercise of the proxy; or (iii) in any other manner permitted by law. A non?registered unitholder may revoke a form of proxy or voting instruction form given to an intermediary at any time by written notice to the intermediary in accordance with the instructions given to the non-registered unitholder by its intermediary. Non-registered unitholders should contact their broker for assistance in ensuring that forms of proxies or voting instructions previously given to an intermediary are properly revoked. None of Mr. Janes, or, to his knowledge, any of his associates or affiliates, has any material interest, direct or indirect, in any transaction since the commencement of the Fund's most recently completed financial year, or in any proposed transaction which has materially affected or will materially affect the Fund or any of its subsidiaries. None of Mr. Janes or, to its knowledge, any of his associates or affiliates, has any material interest, direct or indirect, by way of beneficial ownership of securities or  otherwise, in any matter to be acted upon at the Meeting, other than as set out herein.

Based on public disclosure documents, the Fund's principal and head office is located at 5360 South Service Road, Suite 200, Burlington, Ontario, L7L 5L1.

Mr. Janes has filed this press release, which contains the information required by section 9.2(4)(c) of NI 51-102, and the Information Document which contains the information required by section 9.2(6) of NI 51-102 and Form 51-102F5 Information Circular in respect of the Unitholder Nominees, under the Fund's profile on SEDAR at www.sedar.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release, including statements regarding the reconstitution of the Board, contain "forward-looking statements" and are prospective in nature. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties that could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of forward-looking words such as "plans", "expects", "intends", "anticipates", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Although Mr. Janes believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. Material factors or assumptions that were applied in formulating the forward-looking information contained herein include that the Board will be reconstituted by Mr. Janes at the Meeting, that there will be no further unplanned material changes to SIR's facilities, operations and customer and employee relations and that neither SIR nor the Fund will take any action to restrict rights currently held by unitholders. Mr. Janes cautions that the foregoing list of material factors and assumptions is not exhaustive. Many of these assumptions are based on factors and events that are not within the control of Mr. Janes and there is no assurance that they will prove correct. Important factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by such forward-looking statements include, among other things, the impact of the COVID-19 pandemic; breaches of material agreements entered into by SIR, the Fund or their respective affiliates; industry risk and other risks inherent in the running of the business of SIR and the Fund; legal proceedings and challenges to intellectual property rights; dependence of the Fund on the financial condition of SIR; and legislation and governmental regulation. These are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of Mr. Janes' forward-looking statements. Other unknown and unpredictable factors could also impact its results. Many of these risks and uncertainties relate to factors beyond Mr. Janes' ability to control or estimate precisely. Consequently, there can be no assurance that the actual results or developments anticipated by Mr. Janes will be realized or, even if substantially realized, that they will have the expected consequences for, or effects on, the Fund or SIR and their respective future results and performance. Forward-looking statements in this press release are based on Mr. Janes' beliefs and opinions at the time the statements are made, and there should be no expectation that these forward-looking statements will be updated or supplemented as a result of new information, estimates or opinions, future events or results or otherwise, and Mr. Janes disavows and disclaims any obligation to do so, except as required by applicable law.

SOURCE Janes Acquisition Corp.