SIR.L Regulatory News (SIR)

15 April 2015

Secure Income REIT Plc

(the "Company")

Issue of Shares in connection with pre-existing arrangements

The Company announces that it has issued today 11,900,432 new ordinary shares of 10 pence each ("Shares") to Prestbury Incentives Limited ("Prestbury Incentives"), a wholly owned subsidiary of the Company's Investment Adviser, in relation to fees payable for the year ended 31 December 2014, as reported in the Company's results announcement of 12 March 2015 and under arrangements entered into at the time of the Company's listing in June 2014.

The terms of the Company's Investment Advisory Agreement entered into by the Company and its Investment Adviser include arrangements which are designed to reward growth in EPRA NAV per share above and beyond agreed benchmarks and to align the interest of the Investment Adviser with those of all shareholders. The fee entitlement is calculated annually with any fee payable settled in shares in the Company subject to certain limited exceptions. It is calculated at the lower of:

(i) 20% of the excess of shareholder returns over a 10% annual return with the hurdle automatically resetting each year to 10% over the previous year's EPRA NAV plus cumulative distributions paid since listing; and

(ii) 20% of the excess of year end EPRA NAV per share plus cumulative distributions paid over the "high watermark", being EPRA NAV per share plus cumulative distributions per share as at the last time a performance fee was paid.

For a performance fee to arise for the period to 31 December 2014, the EPRA NAV per share of the Group had to exceed 182 pence per share at 31 December 2014. Since this was achieved, 20% of shareholder returns in excess of that level are attributable to Prestbury Incentives, payable by the issue of Shares with the VAT thereon payable in cash. The number of shares issued has been calculated in accordance with the Investment Advisory Agreement at a price equal to the average closing price for the financial period ended 31 December 2014, being 270 pence per share.

Following the issue of the Shares, Prestbury Incentives has a total shareholding in the Company of 11,900,432 ordinary shares, representing 6.6% of the Company's voting rights. Under the terms of the Investment Advisory Agreement, Prestbury Incentives agreed at the time of listing that any shares received under these arrangements will not be permitted to be disposed for a minimum of 18 months and up to 42 months from the end of the relevant accounting period in respect of which they were earned, save under certain limited circumstances including a sale of Shares if required to fund payment of the Prestbury Incentives tax liability arising on receipt of the Shares. The parties to the Investment Advisory Agreement have agreed that the timing of the commencement of the lock-in period as set out in the agreement required clarification and have confirmed that the relevant lock-in dates will commence from Prestbury Incentives' year end date, being 31 March 2015. Hence none of the Shares may be sold before 30 September 2016 following which one third may be sold; a further one third may not be sold before 30 September 2017 and the remaining one third may not be sold before 30 September 2018. Any future Shares issued under the terms of the Investment Advisory Agreement will also be locked in from the 31 March following the end of the relevant accounting period in which any such fees are earned.

The ultimate beneficial owners of Prestbury Incentives include Nick Leslau, Mike Brown and Sandy Gumm each of whom is a director of the Company and a member of the Prestbury Concert Party as defined in the 30 May 2014 Admission Document. Following the issue of Shares to Prestbury Incentives, the Prestbury Concert Party, has a beneficial holding of 55,381,987 ordinary shares, representing 30.7% of the Company's voting rights. The Concert Party as defined in the 30 May 2014 Admission Document (the "Admission Document"), which includes the Prestbury Concert Party, holds 66,036,862 Shares following the issue of the performance fee shares, representing 36.6% of the voting rights in the Company.

The Panel on Takeover and Mergers has previously confirmed to the Company that neither the Concert Party nor the Prestbury Concert Party will be required to make a mandatory offer for the Company under Rule 9 of the City Code on Takeover and Mergers so long as any increase in share interests arises under the specific circumstances detailed in the Admission Document. These circumstances include the allotment of shares in satisfaction of performance fees, so long as the Concert Party does not exceed 40% of the issued share capital of the Company. This confirmation applied at listing and continues to apply.

The fee, number of shares issued and the impact of the VAT element were all accounted for in the results of the Company for the period ended 31 December 2014 announced on 12 March 2015 and amounted to a charge for the fee of £32.1 million plus irrecoverable VAT of £3.1 million.

The Application has been made for the 11,900,432 Shares to be admitted to trading on AIM and admission is expected to be effective at 8.00 a.m. on or around 21 April 2015.

Following the allotment of the Shares, and in accordance with the Disclosure and Transparency Rules, the Company's issued voting ordinary share capital will comprise 180,344,210 ordinary shares. There are no Shares held in treasury. The above figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the ordinary share capital of the Company under the Disclosure and Transparency Rules.

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About Secure Income REIT

Secure Income REIT floated as a Real Estate Investment Trust on the AIM segment of the London Stock Exchange in June 2014. Upon Admission, the Company had a share price of 174p, representing a market capitalisation of £293 million, which has subsequently grown to 305p, valuing the Company in excess of £500 million.

The Company specialises in generating long term, inflation protected, secure income from real estate investments. Its investment strategy is designed to satisfy investors' growing requirements for high quality, safe, inflation protected income flows.

At its preliminary results to 31 December 2014 the Company reported gross assets of £1.63 billion and, with a weighted average unexpired lease term of 25 years across its portfolio, all with fixed or RPI rental uplifts, has one of the longest income profiles in quoted property sector.

The Company's Board is chaired by Martin Moore and also comprises three further independent Directors in Leslie Ferrar, Jonathan Lane and Ian Marcus, as well as three members of the Prestbury Team in Nick Leslau, Mike Brown and Sandy Gumm.

The Company is externally managed by Prestbury Investments LLP which was external manager to Max Property Group plc until August 2014, when was sold to Blackstone Group.

Prestbury and Sir Tom Hunter are majority shareholders in Secure Income REIT with 25% each.