Janes Acquisition Corp. Announces Completion of Offer for Units of SIR Royalty and Comments on Recent Press Releases

TORONTO, Feb. 11, 2021 /CNW/ - Janes Acquisition Corp. (the "Offeror") today announced that it received and accepted 322,688 trust units ("Units") of SIR Royalty Income Fund (TSX: SRV.UN) (the "Fund") at a purchase price of $4.75 per Unit in cash, for an aggregate cost of $1,532,768. The Offeror will complete the purchase of the 322,688 Units (the "Purchased Units") within three business days.

Mr. Janes Significantly Increases Investment in the Fund over Past Year

On March 23, 2020, the Fund announced that "[a]s a result of the suspension of SIR's dine-in operations, the Trustees of the Fund have temporarily suspended unitholder distributions until further notice."  Since that date, the trading price of the Units has dropped significantly and Mr. Lembit Janes, the controlling shareholder of the Offeror, has directly or indirectly purchased over 800,000 Units (including the Purchased Units) for investment purposes.

Mr. Janes stated, "The purchases of Units I have made over the past year have provided those unitholders who sold their Units with immediate liquidity. As a long-term unitholder, my interests and goals are fully aligned with other long-term unitholders who believe that the current trading price of the Units does not represent their underlying value. During the past two weeks I have heard from numerous unitholders and it is clear that they also believe in the long term value of the Fund."

The Offeror and its affiliates and associates beneficially own and exercise control or direction over 833,100 Units, which represents approximately 9.95% of the issued and outstanding Units. Following the purchase of the Purchased Units by the Offeror, the Offeror and its affiliates and associates will beneficially own and exercise control or direction over 1,155,788 Units, which will represent approximately 13.80% of the issued and outstanding Units.

SIR Corp.'s February 10, 2021 Press Release

In its February 10, 2021 press release, SIR Corp. ("SIR") announced that it would not proceed with its January 6, 2021 proposal, and that it would not participate in any strategic process that may be undertaken by the Independent Trustees of the Fund.

In response to those announcements, Mr. Janes noted "I am pleased that SIR has abandoned its January 6, 2021 proposal, but am obviously disappointed that SIR will not assist the Fund in seeking to maximize value for all unitholders. We will nevertheless seek to work with SIR, the Fund and all other stakeholders in order to ensure that the interests of all unitholders are addressed by restoring distribution payments and maximizing the value of the Units."

Addressing Misstatements in the Fund's February 8, 2021 Press Release

In the Fund's February 8, 2021 press release (the "Fund Press Release"), the Independent Trustees alleged that we had misled our fellow unitholders by stating that SIR and the Trustees of the Fund had decided to stop all distributions. The Independent Trustees then stated "that such a decision was not made voluntarily, but was agreed to with SIR's senior lender as a condition to various covenant waivers." The Offeror notes that, as set out above, on March 23, 2020, the Fund announced the temporary suspension of distributions "as a result of the suspension of SIR's dine-in operations". Contrary to the Fund Press Release, an agreement with SIR's senior lender was not reached until May 27, 2020.

The Fund Press Release also notes that notwithstanding that the Offeror has stated that it is committed to working with the Independent Trustees to seek out every alternative that can maximize value for all unitholders, the Offeror has not approached the Independent Trustees in that regard. The Offeror reiterates its willingness to work with the Independent Trustees and will seek to formally engage with the Independent Trustees shortly. Mr. Janes expects and hopes that the Independent Trustees will work with him, as the largest independent unitholder of the Fund, in the best interests of ALL unitholders.

Additional Information

Depending on market conditions and other factors, the Offeror or its affiliates may in the future increase or decrease their control or direction over securities of the Fund through open market transactions, private agreements or otherwise. The Offeror is committed to working with the Fund to pursue alternatives that can maximize value for all unitholders, but nevertheless reserves the right to take whatever other steps and actions that it believes may be appropriate to maximize the value of the Units. Such steps and actions may include, without limitation, speaking with certain unitholders and other persons.  

The Offeror's head office is located at 181 Bay Street, Suite 4400, Brookfield Place, Toronto, Ontario, M5J 2T3. The Fund's principal and head office is located at 5360 South Service Road, Suite 200, Burlington, Ontario, L7L 5L1.

This press release is being issued, in part, pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issuers, which requires a report to be filed under the Fund's profile on SEDAR (www.sedar.com) containing additional information respecting the foregoing matters. A copy of such report may be obtained by contacting Mr. Lembit Janes at 416-882-7392 or by email at [email protected]. 

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release, including statements regarding the maximization of the value of the Units, 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 the Offeror 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 the assumption that the negative impact of the COVID-19 pandemic on the business and economic conditions affecting SIR's and the Fund's operations will abate over the short time, 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. The Offeror 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 the Offeror 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; changes in demographic trends; weather; changing consumer preferences and discretionary spending patterns; changes in consumer confidence; changes in national and local business and economic conditions; pandemics or other material outbreaks of disease or safety issues affecting humans or animals or food products; changes in tariffs and international trade; changes in foreign exchange; changes in availability of credit; legal proceedings and challenges to intellectual property rights; dependence of the Fund on the financial condition of SIR; legislation and governmental regulation, including the cost and/or availability of labour as it relates to changes in minimum wage rates or other changes to labour legislation and forced closures of restaurants and bars; and laws affecting the sale and use of alcohol (including availability and enforcement).These are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of the Offeror's forward-looking statements. Other unknown and unpredictable factors could also impact its results. Many of these risks and uncertainties relate to factors beyond the Offeror's ability to control or estimate precisely. Consequently, there can be no assurance that the actual results or developments anticipated by the Offeror will be realized or, even if substantially realized, that they will have the expected consequences for, or effects on, the Offeror, the Fund or SIR and their respective future results and performance. Forward-looking statements in this press release are based on the Offeror's 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 the Offeror disavows and disclaims any obligation to do so, except as required by applicable law.

SOURCE Janes Acquisition Corp.

Mr. Lembit Janes can also be reached at 416-882-7392 or by email at [email protected]