PADLOCK FUNDS ANNOUNCE RECEIPT OF EXEMPTIVE RELIEF RELATING TO SPECIAL MEETINGS

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TORONTO, July 19, 2024 /CNW/ - Padlock Partners UK Fund I ("Fund I"), Padlock Partners UK Fund II ("Fund II") and Padlock Partners UK Fund III ("Fund III", and together with Fund I and Fund II, the "Padlock Funds") today announced that further to the announcement on June 19, 2024 of the Padlock Funds relating to the proposed consolidation of the assets of the Padlock Funds through an acquisition of Fund II and Fund III by Fund I, which will be renamed Padlock Euro Storage Fund I (the "Merged Fund") by way of a plan of arrangement (the "Arrangement"), the Padlock Funds have received discretionary exemptions from the Ontario Securities Commission (the "OSC") from the certain requirements of Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions ("MI 61-101") which would allow the Padlock Funds to conduct a single vote of each Padlock Fund with unitholders voting together as a single class in connection with the previously announced security holder meetings to approve the Arrangement.

MI 61-101 requires approval of the Arrangement to be received from a majority of the votes attached to the existing units of each of the Padlock Funds ("Existing Units") voted by disinterested unitholders voting separately on a class-by-class basis at each of the Padlock Fund's meetings. The OSC has granted exemptive relief from this requirement, and instead unitholders of each Padlock Fund will vote as a single class, on the basis that, among other reasons (i) each Padlock Fund's governing declaration of trust provides that unitholders vote as a single class unless the nature of the business to be transacted at the meeting affects holders of one class of units in a manner materially different from its effect on holders of another class of units, and each Padlock Fund, the asset managers of the Padlock Funds and the independent trustees of each Padlock Fund have determined that the Arrangement does not affect holders of one class of Existing Units in a manner materially different from its effect on holders of another class of Existing Units of that Padlock Fund; (ii) as the relative returns (and, accordingly, the number of units of the Merged Fund to be received on exchange of Existing Units of each class of each Padlock Fund) are to be determined in accordance with the terms established in the governing declaration of trust of each Padlock Fund that were set at the time of each such issuer's initial public offering when investors selected their preferred class and purchased their Existing Units, the interests of the holders of each class of Existing Units of each Padlock Fund are aligned in respect of the Arrangement, and (iii) the Arrangement is subject to a number of procedural mechanisms to ensure the collective interests of the existing Padlock Fund unitholders were protected, including, but not limited to, that (a) negotiation of the Arrangement was overseen by the independent trustees of each Padlock Fund, (b) both the independent trustees of each Padlock Fund and the board of trustees of each Padlock Fund have received a fairness opinion, (c) the independent trustees of each Padlock Fund determined that the net asset value attributable to each Padlock Fund, respectively, and the exchange ratio, were reasonable, (d) each Padlock Fund will hold its respective meeting to allow unitholders to consider and, if deemed advisable, approve the Arrangement, and (e) the Padlock Funds have prepared and delivered to its respective unitholders an information circular dated June 24, 2024 (the "Information Circular") which describes the Arrangement.

As of the date hereof and to the knowledge of each of the Padlock Funds, pursuant to MI 61-101, no Existing Units are held by existing Padlock Fund unitholders that would not be "disinterested unitholders" within the meaning of MI 61-101.

Subject to obtaining Court approval and the satisfaction or waiver of all other conditions relating to the Arrangement, if unitholder approvals from each of the Padlock Funds are obtained at each respective meeting, it is anticipated that the Arrangement will be completed in late-July 2024.

About the Padlock Funds

Each of the Padlock Funds is an unincorporated investment trusts formed under the laws of the Province of Ontario and was established for the primary purpose of investing in a diversified portfolio of income producing commercial real estate properties in the United Kingdom with a focus on self-storage and mixed-use properties. Currently, the Padlock Funds have acquired self-storage properties in Bicester, Letchworth, Leighton Buzzard, Wimbledon, Chippenham, Enfield, Huntingdon, Brentwood, Newmarket, Houghton Regis, Brighton, Watford, Woking, Southend and Seaford.

Forward-Looking Statements

This news release includes certain statements which may constitute forward-looking information within the meaning of Canadian securities laws, including, but not limited to, statements or information relating to the successful completion of the Arrangement and timing thereof. Such forward-looking information, in some cases, can be identified by terminology such as "may", "will", "would", "expect", "plan", "anticipate", "believe", "intend", "target", "potential", "continue", or the negative thereof or other similar expressions concerning matters that are not historical facts.

By their nature, forward-looking statements and information involve known and unknown risks, uncertainties and other factors that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the control of the Padlock Funds, affect the operations, performance and results of such issuer's and their respective businesses, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking information as there can be no assurance that actual results will be consistent with such forward-looking information. These risks include, but are not limited to, the risk of failure to satisfy the conditions to completion of the Arrangement. For more information on risks relating to the Arrangement, read the Information Circular.

Information contained in forward-looking statements are based upon certain material assumptions that were applied in drawing a conclusion or making a forecast or projection, as well as other considerations that are believed to be appropriate in the circumstances.

These forward-looking statements are made as of the date of this news release and, except as expressly required by law, the Padlock Funds undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

SOURCE Padlock Partners UK Fund I, Padlock Partners UK Fund II and Padlock Partners UK Fund III

To learn more about the Padlock Funds, contact: John Stevenson, Chief Executive Officer, Padlock Partners UK Fund I, Padlock Partners UK Fund II and Padlock Partners UK Fund III, [email protected]; Matthew Collins, Chief Financial Officer, Padlock Partners UK Fund I, Padlock Partners UK Fund II and Padlock Partners UK Fund III, [email protected]