SIR Royalty Income Fund Announces Filing of Information Circular for its Upcoming Annual General Meeting

BURLINGTON, ON, June 2, 2021 /CNW/ - SIR Royalty Income Fund (TSX: SRV.UN) (the "Fund") today announced that the Fund has SEDAR-filed its Information Circular in connection with the Annual General Meeting of voting unitholders of the Fund to be held on June 29, 2021, and that the mailing process is underway.

As announced on May 31, 2021, SIR Corp. ("SIR") is expected to recommence royalty payments shortly and, with the consent of its bank lender and in conjunction with the extension of its credit facilities, has announced a plan to enable SIR to catch up on deferred payments by July 6, 2022. In addition, with vaccination rates rising and COVID-19 case counts declining, governments across Canada have been announcing re-opening plans. As a result, Fund distributions, which are expected to be modest at first and increase over time, are expected to recommence shortly.

The Fund's trustees have worked diligently to help the Fund and SIR Corp. through this difficult time, culminating in this pending resumption of distributions to unitholders. They strongly believe that now is not the time for a wholesale change in the make-up of the board of trustees, but for continued leadership by experienced trustees who understand the complexities of the Fund's structure and who have an appropriate depth of understanding of SIR's business and its impact on the Fund.

Lembit Janes has proposed that his three nominees (the "Janes' Nominees") fully replace the Fund's three current independent trustees. In addition, he has improperly besmirched the incumbents' integrity and independence. Replacing them with his three nominees would give Mr. Janes full control of the Fund, despite only holding approximately 16% of the Fund's equity and voting rights. Both the Fund's trustees and SIR believe that it would be reasonable for Mr. Janes, as a significant unitholder, to be represented on the board of trustees of the Fund should he wish to be so represented. However, they do not believe that it would be appropriate or reasonable for him to take control of the board of trustees by replacing all of the independent trustees with the Janes' Nominees.

For the reasons outlined above and as further outlined in the Information Circular, including Mr. Janes' demonstrated history of litigiousness and disruption, his continued misstatements, his failure to make any proposals with respect to dealing with SIR's senior lender, and the lack of clarity as to his true intentions, the Fund is proposing to increase the size of the board of trustees to nine members so as to facilitate board representation for Mr. Janes, but not control by Mr. Janes. One of the existing independent trustees, Peter Luit, has advised that he will not stand for re-election, and three new proposed independent trustees, Douglas Buchanan, Sandra Levy and Norm Mayr, are being recommended by the Fund. The trustees are recommending that unitholders withhold their votes for the Janes' Nominees. Mr. Luit is thanked for his service and dedication for the past 17 years.

As a result of the COVID-19 pandemic, the meeting is to be held primarily by telephone conference call, and all votes will be conducted by ballot. Special procedures, as outlined in the information circular, have been adopted to enable ballots to be deposited in advance of the meeting if unitholders wish to appoint proxyholders other than the management nominees identified on the Fund's GOLD proxy or voting instruction form.

About SIR Royalty Income Fund

The Fund is a trust governed by the laws of the province of Ontario that indirectly has interests in the trademarks used by SIR.

About SIR Corp.

SIR Corp. ("SIR") is a privately held Canadian corporation that owns a portfolio of 53 restaurants in Canada. SIR's Concept brands include: Jack Astor's Bar and Grill®, with 37 locations; Scaddabush Italian Kitchen & Bar® with nine locations; and Canyon Creek®, with two locations. SIR also operates one-of-a-kind "Signature" brands including Reds® Wine Tavern, Reds® Square One and The Loose Moose®. All trademarks related to the Concept and Signature brands noted above are used by SIR under a License and Royalty Agreement with SIR Royalty Limited Partnership. SIR also owns one Duke's Refresher® & Bar locations in downtown Toronto, and one seasonal Signature restaurant, Abbey's Bakehouse®, which are currently not in consideration to be part of the Royalty Pool. For more information on SIR Corp. or the SIR Royalty Income Fund, please visit www.sircorp.com.

Caution concerning forward-looking statements

Certain statements contained in this report, or incorporated herein by reference, including the information set forth as to the future financial or operating performance of the Fund or SIR Corp. ("SIR Corp." or the "Corporation"), that are not current or historical factual statements may constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Statements concerning the objectives, goals, strategies, intentions, plans, beliefs, expectations and estimates, and the business, operations, financial performance and condition of the Fund, SIR Holdings Trust (the "Trust"), SIR Royalty Limited Partnership (the "Partnership"), SIR Corp. or industry results, are forward-looking statements. The words "may", "will", "should", "could", "would", "expect", "believe", "plan", "anticipate", "intend", "estimate" and other similar terminology and the negative of such expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Fund, the Trust, the Partnership, SIR Corp. or industry results to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. These statements reflect SIR Corp. management's ("Management") current expectations, estimates and projections regarding future events and operating performance and are based on information currently available to Management, Management's historical experience, perception of trends and current business conditions, expected future developments and other factors which management considers appropriate. The forward-looking statements speak only as of the date hereof. Readers should not place undue importance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur, and readers should not rely upon this information as of any other date. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements. Risks related to forward-looking statements include, among other things, challenges presented by a number of factors, including, without limitation: the impact of the COVID-19 pandemic, including a worsening of the COVID-19 pandemic, changes in governmental or customer responses to the COVID-19 outbreak, continued availability of required employees, business interruptions, access to restaurant locations and access to needed supplies and capital; market conditions; competition; 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 or interest rates; changes in availability of credit; legal proceedings and challenges to intellectual property rights; dependence of the Fund on the financial condition of SIR Corp.; 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; changes in laws affecting the sale and use of alcohol (including availability and enforcement); changes in cannabis laws; changes in tax laws; changes in accounting policies and practices; and the results of operations and financial condition of SIR Corp. The foregoing list of factors is not exhaustive. Many of these issues can affect the Fund's or SIR Corp.'s actual results and could cause their actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Fund or SIR Corp.  There can be no assurance that SIR Corp. will remain compliant in the future with all of its financial covenants under the Credit Agreement (as defined herein) and otherwise, particularly amid the COVID-19 outbreak. Given these uncertainties, readers are cautioned that forward-looking statements are not guarantees of future performance and should not place undue reliance on them. The Fund and SIR Corp. expressly disclaim any obligation or undertaking to publicly disclose or release any updates or revisions to any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are based on Management's current plans, estimates, projections, beliefs and opinions, and the Fund and SIR Corp. do not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change, except as expressly required by applicable securities laws.

In formulating the forward-looking statements contained herein, Management has assumed that its businesses will be able to continue to operate following the resolution of the COVID-19 pandemic and that business and economic conditions affecting SIR Corp.'s restaurants and the Fund will return to normalcy within the medium term. However, the continuation or escalation of this public health crisis could create adverse impacts on the Fund's and SIR Corp.'s workforce, supply chain and customer access and could reduce revenue for the Fund and SIR Corp., which could have a material adverse effect on SIR Corp.'s business, financial condition and results of operations. Management has also assumed that SIR Corp. will remain compliant in the future with, or receive waivers from, all of its financial covenants under the Credit Agreement and otherwise. These assumptions, although considered reasonable by Management at the time of preparation, may prove to be incorrect. For more information concerning the Fund's risks and uncertainties, please refer to the Fund's annual information form dated March 31, 2021 for the period ended December 31, 2020, which is available under the Fund's profile at www.sedar.com.

All of the forward-looking statements made herein are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Fund or SIR Corp. In particular, there can be no assurance that restaurants will be able to reopen as currently anticipated, or that current or deferred royalty payments will be able to be made as currently anticipated. See "Risk Factors" in the Fund's annual information form dated March 31, 2021 for the period ended December 31, 2020.

SOURCE SIR Royalty Income Fund

Jeff Good, Chief Financial Officer, Tel: [phone]; Bruce Wigle, Bay Street Communications, Tel: [phone]; Christine Carson, Carson Proxy Advisors, [email protected], 416-804-0825