NOTICE OF SPECIAL MEETING AND MANAGEMENT INFORMATION CIRCULAR FOR THE SPECIAL MEETING OF UNITHOLDERS TIMBERCREEK GLOBAL REAL ESTATE INCOME FUND

Transcription

1 NOTICE OF SPECIAL MEETING AND MANAGEMENT INFORMATION CIRCULAR FOR THE SPECIAL MEETING OF UNITHOLDERS OF TIMBERCREEK GLOBAL REAL ESTATE INCOME FUND To be held on Tuesday, December 19, 2017 at 9:30 a.m. (Eastern Time), at the offices of McCarthy Tétrault LLP, TD Bank Tower, 53 rd Floor, 66 Wellington Street West Toronto, Ontario, Canada, M5K 1E6. November 14, 2017

2 TABLE OF CONTENTS NOTICE OF SPECIAL MEETING... 1 MANAGEMENT INFORMATION CIRCULAR... 1 SOLICITATION OF PROXIES... 1 PROPOSED FUND MERGER... 1 APPOINTMENT AND REVOCATION OF PROXIES... 7 VOTING OF PROXIES... 7 RECORD DATES... 7 VOTING UNITS AND PRINCIPAL HOLDERS THEREOF... 7 INTEREST OF INSIDERS IN THE PROPOSED MERGER... 8 OTHER BUSINESS... 9 ADDITIONAL INFORMATION... 9 RECOMMENDATION REGARDING THE MERGER... 9 CERTIFICATE SCHEDULE A i

3 TIMBERCREEK GLOBAL REAL ESTATE INCOME FUND (the Continuing Fund ) NOTICE OF SPECIAL MEETING Tuesday, December 19, 2017 NOTICE IS HEREBY GIVEN that a special meeting (the Special Meeting ) of unitholders of the Continuing Fund will be held on Tuesday, December 19, 2017 at 9:30 a.m. (Eastern Time), at the offices of McCarthy Tétrault LLP, TD Bank Tower, 53rd Floor, 66 Wellington Street West, Toronto, Ontario, Canada, M5K 1E6. If a quorum for the Special Meeting is not present, then the Special Meeting will be adjourned and such adjourned Special Meeting will be held on January 2, 2018 at 9:30 a.m. (Eastern Time), at the offices of McCarthy Tétrault LLP, TD Bank Tower, 53rd Floor, 66 Wellington Street West, Toronto, Ontario, Canada, M5K 1E6. If the Special Meeting is adjourned, this notice shall constitute notice of the adjourned Special Meeting. The purpose of the Special Meeting is to consider and if advisable pass resolutions to approve the following: 1. the merger of Timbercreek Global Real Estate Fund (the Terminating Fund ) into the Continuing Fund to be effected on or about January 22, 2018 (the Merger ), and the matters related thereto described in the resolution attached to the accompanying management information circular (the Circular ); and 2. to transact such further or other business as may properly come before the Special Meeting or any adjournment(s) thereof. A Circular dated November 14, 2017 describing the matters to be considered at the Special Meeting and a proxy form accompany this notice. A copy of the text of the proposed resolutions authorizing the above change is set out in Schedule A of the accompanying Circular. Only unitholders of record of the Continuing Fund as of the close of business on November 14, 2017 will be entitled to receive notice of and vote at the Special Meeting. Unitholders who are entitled to vote, but are unable to attend the Special Meeting in person, are requested to exercise their right to vote by completing, dating, signing and returning, in the envelope provided for that purpose, the enclosed proxy form. To be effective, completed proxies must be received by Broadridge Investor Services Inc. as proxy agent at: Broadridge Investor Services Inc., Data Processing Centre, PO Box 2800, Stn. LCD, Malton, Mississauga, Ontario, L5T 9Z9 or by fax to Alternatively, you may enter your voting instructions by telephone at or via the internet at Completed proxies or voting instructions must be received not later than 4:00 p.m. (Eastern time) on December 15, 2017, or, in the case of an adjournment of the Special Meeting, at least 24 hours (excluding Saturdays, Sundays and statutory holidays in the City of Toronto, Ontario) before the time of the adjourned meeting. 1

4 The approval of the resolutions will require the affirmative vote of not less than 50% of the votes attached to the units of the Continuing Fund represented and voted at the Special Meeting. Those unitholders present in person or represented by proxy will constitute a quorum. Timbercreek Investment Management Inc. ( Timbercreek ), as manager of the Continuing Fund, recommends that unitholders of the Continuing Fund vote FOR the Merger. As required by National Instrument Independent Review Committee for Investment Funds, Timbercreek presented the terms of the Merger to the Independent Review Committee ( IRC ) for its review. The IRC has reviewed the potential conflicts of interest matters relating to the Merger and the reasons for the Merger set forth in the accompanying Circular. After consideration of those matters, the IRC was of the opinion that the Merger, if implemented, will achieve a fair and reasonable result for unitholders of the Continuing Fund. While the IRC has considered the Merger of the Terminating Fund and Continuing Fund from a conflict of interest perspective, the IRC is not recommending that unitholders vote in favour of or against the Merger. It is not the role of the IRC to recommend that unitholders vote in favour of or against the Merger. Unitholders should review the Merger and make their own decision. DATED at Toronto, Ontario, the 14 th day of November, By order of the Board of Directors of Timbercreek Investment Management Inc., as Trustee and Manager of the Continuing Fund By: R. Blair Tamblyn R. Blair Tamblyn President and Chief Executive Officer 2

5 TIMBERCREEK GLOBAL REAL ESTATE INCOME FUND (the Continuing Fund ) MANAGEMENT INFORMATION CIRCULAR SOLICITATION OF PROXIES This management information circular (the Circular ) is furnished to unitholders of the Continuing Fund in connection with the solicitation of proxies by Timbercreek Investment Management Inc. ( Timbercreek or the Manager ) in its capacity as manager of the Continuing Fund, to be used at the special meeting of unitholders of the Continuing Fund (the Special Meeting ) to be held on Tuesday, December 19, 2017 at 9:30 a.m. (Eastern Time), at the offices of McCarthy Tétrault LLP, TD Bank Tower, 53rd Floor, 66 Wellington Street West, Toronto, Ontario, Canada, M5K 1E6, to consider merging (the Merger ) Timbercreek Global Real Estate Fund (the Terminating Fund ) into the Continuing Fund effective on or about January 22, 2018 (the Merger Date ) and to transact such other business as may properly come before the Special Meeting. If a quorum for the Special Meeting is not present, then the Special Meeting will be adjourned and such adjourned meeting(s) will be held on January 2, 2018 at 9:30 a.m. (Eastern Time), at the offices of McCarthy Tétrault LLP, TD Bank Tower, 53rd Floor, 66 Wellington Street West, Toronto, Ontario, Canada, M5K 1E6. In respect of the Special Meeting, it is anticipated that proxies will be primarily solicited by mail. However, directors, officers or employees of the Manager may solicit proxies by mail or personally. The cost of solicitation of proxies for the Special Meeting will be borne by the Manager. Except as otherwise stated, the information contained in this Circular is given as of October 31, A. Introduction PROPOSED FUND MERGER The Terminating Fund is a closed-end investment fund established as a trust under the laws of the Province of Ontario pursuant to a declaration of trust dated August 5, The Terminating Fund is a non-redeemable investment fund and is not considered to be a mutual fund under the securities legislation of the provinces and territories of Canada. The Terminating Fund most recently offered its class A units in all of the provinces of Canada pursuant to a short form prospectus dated September 23, The Terminating Fund s class A units are listed on the Toronto Stock Exchange (the TSX ). The Terminating Fund s class B units are not listed on any stock exchange. The Continuing Fund is an open-end mutual fund trust established under the laws of the Province of Ontario and governed by a fifth amended and restated declaration of trust dated as of June 29, 2017, as amended (the Declaration of Trust ). The Continuing Fund was established on April 18, 2013 as a non-public mutual fund. Series A units, Series AX units, Series AY units, Series F units, Series FX units, Series FY units and Series I units of the Continuing Fund are offered for sale pursuant to a simplified prospectus dated June 29, 2017, as amended (the Simplified Prospectus ). Series M units, Series S units and Series T units of the Continuing Fund are currently not available for purchase under the Simplified Prospectus or any other prospectus. B. Structure of Merger The proposed Merger of the Terminating Fund into the Continuing Fund will be structured as follows: (a) (b) (c) Unitholders of the Continuing Fund will be asked at the Special Meeting to approve the Merger and such other matters as are set forth in the resolutions in respect of the Merger attached as Schedule A to this Circular. Prior to effecting the Merger, the Terminating Fund will liquidate portfolio securities that do not meet the investment objective and investment strategies of the Continuing Fund. The Terminating Fund will determine the amount of income and net taxable gains (if any) it has realized during the taxation year including the Merger Date. If applicable, the Terminating Fund will distribute sufficient net income and net capital gains to unitholders (which may be effected through cash or unit distributions) to ensure that the Terminating Fund will not be subject to tax under Part I of the Income Tax Act (Canada) (the Tax Act ). 1

6 (d) (e) (f) (g) (h) The Continuing Fund will acquire the portfolio securities and other assets of the Terminating Fund in exchange for Series A and Series F units of the Continuing Fund. The Series A units and the Series F units of the Continuing Fund will have an aggregate net asset value equal to the value of the portfolio securities and other assets that the Continuing Fund is acquiring from the Terminating Fund, and the Series A units and Series F units of the Continuing Fund will be issued at the applicable series net asset value per unit as of the close of business on the Merger Date. The Continuing Fund will not assume any liabilities of the Terminating Fund and the Terminating Fund will retain sufficient cash or property to satisfy its estimated liabilities, if any, as of the Merger Date. Immediately thereafter, Series A units of the Continuing Fund will be distributed to class A unitholders of the Terminating Fund and Series F units of the Continuing Fund will be distributed to class B unitholders of the Terminating Fund upon the redemption of their units in the Terminating Fund. The Terminating Fund and the Continuing Fund will file an election under section of the Tax Act. Following the Merger, and in any case within 60 days thereof, the Terminating Fund will be wound up and delisted from the TSX. Should unitholders of the both the Terminating Fund and the Continuing Fund (collectively referred to as the Funds ) approve the Merger, it is proposed that the Merger will occur on the Merger Date, or on such later date as may be determined by the Manager, subject to obtaining any requisite unitholder and stock exchange approval. National Instrument Independent Review Committee for Investment Funds ( NI ) requires the Manager to refer all conflicts of interest matters (as described in NI ) to the Continuing Fund s independent review committee (the IRC ) for its review and recommendation or, in certain circumstances, approval of the matter. Further information about the composition and duties of the IRC is contained in the current annual information form of the Continuing Fund a copy of which is available on SEDAR at At a meeting held on November 14, 2017, the IRC reviewed the potential conflict of interest matters relating to the Merger and the reasons for the Merger set forth in Section C of this Circular. After consideration of these matters, the IRC was of the opinion that the Merger, if implemented, will achieve a fair and reasonable result for unitholders of the Continuing Fund. While the IRC has considered the Merger of the Terminating Fund and Continuing Fund from a conflict of interest perspective, the IRC is not recommending that unitholders vote in favour of or against the Merger. It is not the role of the IRC to recommend that unitholders vote in favour of or against the Merger. Unitholders should review the Merger and make their own decision. The Manager may, in its discretion, postpone implementing the approved Merger until a later date (which shall be no later than February 28, 2018, where it considers such postponement to be appropriate. The Manager may also cancel the approved Merger, at any time, where the Manager considers such cancellation to be in the best interests of unitholders of the Funds. The cost of effecting the Merger will be borne by the Manager and not by the Funds. C. Reasons for the Merger The Manager believes the Merger will be beneficial to unitholders of the Terminating Fund and unitholders of the Continuing Fund for the following reasons: (a) (b) (c) Unitholders of both the Terminating Fund and the Continuing Fund will enjoy increased economies of scale as part of a larger combined Continuing Fund; The Continuing Fund will have a portfolio of greater value, allowing for increased portfolio diversification opportunities, which may lead to increased returns and/or a reduction of risk; The management expense ratios (the MERs ) of the Series A units and Series F units, as applicable, of the Continuing Fund after the Merger are expected to be lower than the MERs of the Series A units and Series F units of the Continuing Fund prior to the Merger; and 2

7 (d) The Continuing Fund, as a result of its greater size, and thus larger profile in the marketplace, will benefit from potentially attracting more securityholders and enabling it to maintain a critical mass. D. Comparison of Investment Objectives and Strategies Investment Objectives The investment objectives of the Terminating Fund are to provide unitholders with quarterly distributions and to preserve capital while providing the opportunity for long-term capital appreciation for unitholders by investing in a diversified portfolio of premier real estate securities including common equity, preferred shares and debt of both public and private real estate investment trusts and real estate companies in Canada, the United States, the United Kingdom, Continental Europe, Japan, Australia, Hong Kong, Singapore and other countries. The investment objectives of the Continuing Fund are to provide unitholders with monthly distributions and to preserve capital while providing the opportunity for long-term capital appreciation for unitholders by investing in the common equity, preferred equity and debt securities issued by real estate investment trusts and other real estate investment issuers. The Continuing Fund will provide unit holders with exposure to the global real estate market by owning a diversified portfolio of dividend paying real estate securities in developed markets from around the world. Investment Strategies The investment strategy of the Terminating Fund has been designed to capitalize on pricing inefficiencies in the global real estate securities market relative to the global direct real estate market in order to deliver a stable income stream acquired at a price that the Manager believes does not reflect the long-term value of the underlying assets. Furthermore, the Manager believes that the current pricing in global equity markets provides the Terminating Fund with the opportunity to assemble a global portfolio of real estate securities at prices that generate attractive, stable yields with the potential for capital appreciation. The investment strategy of the Continuing Fund has been designed to capitalize on pricing inefficiencies in the global real estate securities market relative to the global direct real estate market in order to deliver a stable income stream acquired at a price that the Manager believes does not reflect the long-term value of the underlying assets. Furthermore, the Manager believes that the current pricing in global equity markets provides the Continuing Fund with the opportunity to assemble a global portfolio of real estate securities at prices that generate attractive, stable yields with the potential for capital appreciation. The investment strategies of the Terminating Fund and the Continuing Fund differ in some respects, including that the Terminating Fund, structured as a closed-end investment fund, is permitted to employ leverage and to purchase illiquid investments that represent up to 20% of the Terminating Fund s total assets. The Continuing Fund is not permitted to use leverage (except as permitted under National Instrument Investment Funds ( NI )) and is subject to a limit of 10% of its net asset value with respect to the acquisition of illiquid assets. Portfolio Management Team for the Funds Timbercreek Investment Management Inc. acts as manager and portfolio advisor of the Terminating Fund and the Continuing Fund. Corrado Russo, as portfolio manager of the Manager, is principally responsible for the day-to-day management of the portfolios of the Funds. Following the Merger, Timbercreek Investment Management Inc. will continue to act as portfolio manager to the Continuing Fund and Corrado Russo will continue to be principally responsible for the day-to-day management of the portfolio of the Continuing Fund. E. Comparison of Asset Size, Fees and Expenses of the Funds The following table sets out the combined net assets for the Terminating Fund and the Continuing Fund and the management fees, trailer fees and management expense ratios for the Terminating Fund and Series A and Series F units of the Continuing Fund: 3

8 Combined Net Assets for All Classes or Series as of October 31, 2017 Management Fee (%) for each Class or Series Timbercreek Global Real Estate Fund (Terminating Fund) $86,198,322 $51,527,438 Class A units and Class B units: 0% of net asset value per annum in years in which the Total Return (as defined below) is negative; 1.25% of net asset value per annum in years in which the Total Return is between 0% and 7.99%; Timbercreek Global Real Estate Income Fund (Continuing Fund) Series A units 2.00% per annum of the Series A net asset value of the Series A units of the Continuing Fund Series F units 1.00% per annum of the Series F net asset value of the Series F units of the Continuing Fund Trailer Fees Management Expense Ratio as of June 30, % of net asset value per annum in years in which the Total Return is between 8% and 11.99%; and 1.8% of net asset value per annum in years in which the Total Return is in excess of 12%. Total Return means the return generated on the units, including income from distributions declared, as well as the appreciation or depreciation in the net asset value per unit, over the calendar year, calculated on December 31 of each year. The Manager pays to each registered dealer a service fee (the Service Fee ) equal to 0.40% annually of the net asset value per Class A unit for each Class A unit held by clients of such registered dealer. This Service Fee is reflected in the calculation of the net asset value for the Class A units. There is no Service Fee applicable to Class B units. Class A units 2.78% Class B units 2.42% The Manager pays to brokers an annual trailer fee of up to 1.00% of the value of Series A units of the Continuing Fund held by clients of such brokers. The Manager does not pay an annual trailer fee in respect of the Series F units of the Continuing Fund. Series A units 2.58% Series F units 1.44% In addition to the management fee, the Terminating Fund also pays for all ordinary expenses it incurs or is incurred on its behalf by the Manager in connection with the Terminating Fund s operation and management. In addition to the fees and expenses referenced above, these expenses include, without limitation, as applicable: (a) financial reporting costs and mailing and printing expenses for periodic reports to security holders and other security holder communications including marketing and advertising expenses; (b) any taxes payable by the Terminating Fund; (c) fees payable to the Terminating Fund s transfer agent, fund administrator, lenders, record keeper and custodian; (d) costs and fees payable to any valuator, technical consultant, accountant or auditor or other third party service provider; (e) ongoing regulatory filing fees, maintenance of listing fees or other stock exchange requirement fees, licence fees and other fees; (f) any expenses incurred in connection with any legal proceedings in which the Manager participates on behalf of the Terminating Fund or any other acts of the Manager or any other agent of the Terminating Fund in connection with the maintenance or protection of the property of the Terminating Fund; (g) any fees payable to, and expenses incurred by, independent trustees and the IRC; (h) any additional fees payable to the Manager for performance of extraordinary services on behalf of the Terminating Fund; and 4

9 (i) consulting fees and expenses associated with the preparation of tax filings. The Terminating Fund is also responsible for all taxes, commissions, brokerage commissions and other costs of securities transactions, debt service and costs relating to any credit facilities and any extraordinary expenses which it may incur or which may be incurred on its behalf from time to time, as applicable. In addition to the management fee and applicable GST/HST and PST that is payable by the Continuing Fund described above, the Continuing Fund is required to pay its operating expenses which include expenses directly related to portfolio transactions, brokerage commissions, custodial, unitholder record keeping and unitholder communication charges, legal and audit expenses and applicable GST/HST and PST as well as any taxes and interest related to the operation of the Continuing Fund. The Manager allocates operating expenses incurred for the benefit of two or more Series of units of the Continuing Fund offered proportionately among the relevant Series of units of the Continuing Fund. Operating expenses that are specific to a Series are allocated to that Series. Certain operating expenses are subject to applicable taxes. The Manager may, in its sole discretion, waive the management fee and/or pay on behalf of the Continuing Fund, a portion of the operating expenses otherwise payable by the Continuing Fund. The waiver of management fees and/or payment of the operating expenses, on behalf of the Continuing Fund, may be terminated at any time by the Manager, at its discretion, or may be continued indefinitely by the Manager, at its discretion. Each member of the IRC of the Continuing Fund will receive an annual retainer of $12,000, plus expenses for each meeting, if applicable. These fees and expenses, plus associated legal and insurance costs, are allocated among all of the funds managed by the Manager in a manner that is considered by the Manager to be fair and reasonable. F. Required Approvals for the Merger Authorization of Unitholders The Merger requires the approval of unitholders of the Continuing Fund under NI The Merger is considered to be a material change for the Continuing Fund, as the net asset value of the Terminating Fund is substantially greater than the net asset value of the Continuing Fund. In order to carry out the proposed Merger, unitholders of the Continuing Fund must authorize the Manager to: (a) (b) transfer all of the portfolio securities and other assets of the Terminating Fund in exchange for Series A units and Series F units of the Continuing Fund; and amend the Declaration of Trust of the Continuing Fund to the extent necessary to give effect to the foregoing. To give effect to the foregoing, unitholders of the Continuing Fund are requested to approve the resolutions that are set out in Schedule A to this Circular. Approval will require the affirmative vote of not less than 50% of the outstanding units of the Continuing Fund represented and voted at the Special Meeting in respect of the resolutions. The Merger also requires the approval of unitholders of the Terminating Fund under NI Approval will be sought at a special meeting of unitholders of the Terminating Fund. Securities Regulatory Authorities Approval The Continuing Fund and the Terminating Fund are not required to seek the approval of the Canadian securities regulatory authorities (the CSA ) in connection with the Merger because all of the criteria for pre-approval of the Merger by the CSA are expected to be satisfied. The Merger will not proceed unless and until any necessary regulatory approvals have been obtained. G. Canadian Federal Income Tax Consequences of the Merger The following is a summary of the principal Canadian federal income tax considerations relating to the proposed Merger that are generally applicable to unitholders of the Continuing Fund (the Holders ) who are individuals (other than trusts) and who, at all relevant times, are resident or deemed to be resident in Canada (for purposes of the Tax Act), hold Continuing Fund units, as capital property, have not entered into, with respect to Continuing Fund units, a derivative forward agreement as defined in the Tax Act, and deal at arm s length with and are not affiliated with the Terminating Fund or the Continuing Fund. Generally, Continuing Fund units will be considered to be capital property to a Holder provided that the Holder does not hold the units in the course of carrying on a business and has not acquired the units in one or more transactions considered to be an adventure or concern in the nature of trade. Certain Holders whose Continuing Fund units might not otherwise qualify as capital property may be entitled to make the irrevocable election in the circumstances permitted by subsection 39(4) of the Tax Act to deem such units (and all 5

10 other Canadian securities owned by the Holder) to be capital property. Holders who do not hold their Continuing Fund units as capital property should consult their own tax advisors regarding their particular circumstances. This summary is based on the current provisions of the Tax Act, the regulations thereunder (the Regulations ), all specific proposals to amend the Tax Act and Regulations publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the Tax Proposals ), and the current administrative policies and assessing practices of the Canada Revenue Agency ( CRA ) published in writing by it prior to the date hereof. This summary is not exhaustive of all possible Canadian federal income tax considerations and, except for the Tax Proposals, does not take into account or anticipate any changes in law, nor does it take into account provincial, territorial, foreign or other tax considerations, which may differ significantly from those discussed herein. This summary is also based on the assumptions that the Terminating Fund and the Continuing Fund qualify at all relevant times as mutual fund trusts within the meaning of the Tax Act, were not established and are not and will not be maintained for the benefit of non-residents of Canada for the purpose of the Tax Act and are not SIFT trusts within the meaning of the Tax Act. This summary further assumes that the Terminating Fund and the Continuing Fund will file an election under section of the Tax Act in the manner and time prescribed in relation to the Merger. If either Fund were not to qualify as a mutual fund trust at all relevant times or were to be a SIFT trust, the Canadian federal income tax considerations could be materially and adversely different from those described in this summary. This summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Holder, and no representations with respect to the income tax consequences to any particular Holder are made. Accordingly, Holders should consult their own tax advisors for advice with respect to the tax consequences to them of the Merger, including the application and effect of the income and other tax laws of any country, province, territory, state or local tax authority. Redemption of Continuing Fund Units Prior to the Merger A Holder who redeems Continuing Fund units on or before the date of the Merger will realize a capital gain (or capital loss) in the amount by which the proceeds of redemption of such Continuing Fund units, which generally will not include any amount of income of the Continuing Fund otherwise payable to such Holder or capital gains of the Continuing Fund allocated to such Holder in respect of such redemption, exceed (or are less than) the aggregate of the Holder s adjusted cost base of such Continuing Fund units and any reasonable costs of disposition. One-half of any capital gain (a taxable capital gain ) realized by a Holder on a disposition or deemed disposition of units and the amount of any net taxable capital gains designated by the Terminating Fund in respect of a Holder must generally be included in the Holder s income as a taxable capital gain in the taxation year in which the disposition occurs or in respect of which a net taxable capital gains designation is made by the Continuing Fund. One-half of any capital loss realized by a Holder on a disposition or deemed disposition of units generally must be deducted by the Holder against taxable capital gains of the Holder in the year of disposition, and to the extent one-half of any such losses exceed taxable capital gains in that year, such excess may be deducted only from net taxable capital gains, in the three preceding taxation years or in any subsequent taxation year in accordance with the detailed provisions of the Tax Act. A Holder may be subject to alternative minimum tax in relation to taxable capital gains realized by such Holder or in respect of dividends or net taxable capital gains allocated to such Holder by the Continuing Fund. The taxation of any income payable to such Holder or capital gains allocated to such Holder in respect of such redemption will be the same as described in the Simplified Prospectus of the Continuing Fund. Tax Consequences of the Merger The Merger of the Terminating Fund with the Continuing Fund will occur on a tax-deferred basis. The Terminating Fund will elect jointly with the Continuing Fund for the Merger to be completed as a qualifying exchange in accordance with the mutual fund merger rules in the Tax Act so that the Merger will occur on a tax-deferred basis. The Continuing Fund will be deemed for tax purposes to dispose of and reacquire all of its assets on the date of the Merger. Each asset of the Continuing Fund will be deemed to be disposed of and reacquired for (i) its fair market value, where there is an accrued loss on the asset and (ii) an amount, elected by the Terminating Fund and the Continuing Fund, between the Continuing Fund s adjusted cost base and the fair market value of the asset, where the asset has an accrued gain. The Continuing Fund intends to elect at an amount to realize gains on its assets described in (ii) to offset the losses realized on the disposition of the assets described in (i) above and any existing losses in the Continuing Fund. As a result, the Continuing Fund is expected to realize all of its accrued capital losses and to the extent it elects, accrued capital gains. Any unused losses of the Continuing Fund realized on or before the Merger will expire. 6

11 The Merger will result in a tax year end for the Continuing Fund following the transfer of the assets of the Terminating Fund to the Continuing Fund. The Continuing Fund will distribute a sufficient amount of its net income and net realized capital gains to unitholders on the date of the Merger to ensure that the Continuing Fund will not be subject to tax for its taxation year ended on the date of the Merger. A Holder will be sent a statement for tax purposes that will include the Holder s share of the Continuing Fund s income and capital gains for the taxation year ending on the date of the Merger. The taxation of any distributions paid to a Holder will be the same as described in the Simplified Prospectus of the Continuing Fund. Eligibility for Investment Units of the Continuing Fund are qualified investments under the Tax Act for registered retirement savings plans, registered retirement income funds, deferred profit sharing plans, registered education savings plans, registered disability savings plans, and tax-free savings accounts (collectively, Registered Plans ). The Merger will not change the tax treatment of, or the tax considerations relevant to, Registered Plans as described in the Simplified Prospectus of the Continuing Fund. APPOINTMENT AND REVOCATION OF PROXIES The persons named in the proxy form accompanying this Circular are each an officer and/or director of the Manager. A unitholder has the right to appoint a person (who need not be a unitholder) other than the persons specified in such proxy form to attend and act for such unitholder and on behalf of such unitholder at the Special Meeting. Such right may be exercised by striking out the names of the persons specified in the proxy form, inserting the name of the person to be appointed in the blank space so provided, signing the proxy form and returning it in the reply envelope. A unitholder who executes and returns the proxy form may revoke it: (i) by depositing an instrument of revocation in writing executed by him or her or by his or her attorney authorized in writing, or if the unitholder is a corporation, under the corporate seal or under the hand of an officer or attorney so authorized, at Broadridge Investor Services Inc., Data Processing Centre, PO Box 2800, Stn. LCD, Malton, Mississauga, Ontario, L5T 9Z9, at any time up to and including the last business day preceding the Special Meeting, or any adjournment thereof; or (ii) by depositing such instrument in writing with the Chair of the Special Meeting on the day of such meeting or any adjournment thereof; or (iii) by completing and signing a proxy bearing a later date and depositing it as described above; or (iv) in any other manner permitted by law. In order to be voted, proxies must be received by Broadridge Investor Services Inc. as proxy agent at: Broadridge Investor Services Inc., Data Processing Centre, PO Box 2800, Stn. LCD, Malton, Mississauga, Ontario, L5T 9Z9 or by fax to Alternatively, you may enter your voting instructions by telephone at or via the internet at Completed proxies or voting instructions must be received not later than 4:00 p.m. (Eastern time) on December 15, 2017, or, in the case of an adjournment of the Special Meeting, at least 24 hours (excluding Saturdays, Sundays and statutory holidays in the City of Toronto, Ontario) before the time of the adjourned meeting. VOTING OF PROXIES The persons named in the enclosed form of proxy will vote the units for which they are appointed proxy in accordance with the instructions of the unitholder as indicated on the proxy. Except as indicated below, where no direction is given by a unitholder submitting a proxy, the persons named in the enclosed proxy form will vote the units in favour of each of the matters set out therein. If no date is inserted on a signed proxy, the proxy will be deemed to have been dated on the date the proxy is received. The enclosed proxy form confers discretionary authority upon the persons named therein with respect to amendments or variations to the matters identified in the Notice of Special Meeting and with respect to other matters which may properly come before the Special Meeting in respect of which the proxy is granted or any adjournment of the Special Meeting. As of the date hereof, the Manager knows of no such amendments, variations or other matters to come before the Special Meeting. RECORD DATES November 14, 2017 is the record date for the determination of beneficial ownership of unitholders entitled to receive notice of and to vote at the Special Meeting to be held on or about Tuesday, December 19, 2017, or any adjournment of such Special Meeting. VOTING UNITS AND PRINCIPAL HOLDERS THEREOF The following table represents the issued and outstanding units of each series of the Continuing Fund as at October 31, 2017: 7

12 Timbercreek Global Real Estate Income Fund Series A 644, Series AX Nil Series AY Nil Series F 2,668, Series FX Nil Series FY Nil Series M 1,806, Series S 158, Series T Each unit of the Continuing Fund entitles the owner to one vote for each unit owned by such unitholder at the close of business on the record date for voting. Fractional units are not entitled to be voted. To the knowledge of the Manager, as at the date hereof, except as disclosed below under Interest of Insiders in the Proposed Merger, no unitholders beneficially owned, directly or indirectly, or exercised control or direction over, more than 10% of any series of the issued and outstanding units of the Continuing Fund. The approval of the resolution will require an affirmative vote of not less than 50% of the votes attached to units of the Continuing Fund represented and voted at the Meeting. The Manager INTEREST OF INSIDERS IN THE PROPOSED MERGER Timbercreek Investment Management Inc. currently provides management services to the Terminating Fund pursuant to a management agreement dated August 5, 2010 and provides management services to the Continuing Fund pursuant to the terms of the Continuing Fund s Declaration of Trust. The Manager also provides portfolio management services to each of the Terminating Fund and the Continuing Fund. Each Fund pays fees to the Manager for the services provided to the Fund. The management fees paid by the Terminating Fund and Continuing Fund to the Manager during the year ended December 31, 2016 and from such date to October 31, 2017 were as follows: Management Fees Paid During the Financial Year Ended December 31, 2016 Management Fees Paid from January 1, 2017 to October 31, 2017 Timbercreek Global Real Estate Fund (Terminating Fund) Timbercreek Global Real Estate Income Fund (Continuing Fund) $1,663,822 $1,030,569 $213,543 1 $445, $173,878 in operating expenses absorbed by an affiliate of the Manager. 2 $274,743 in operating expenses absorbed by an affiliate of the Manager. 8

13 The names, places of residence and present positions held by the directors and officers of the Manager are listed below. Name and Municipality of Residence Corrado Russo Toronto, Ontario R. Blair Tamblyn Toronto, Ontario Cameron Goodnough Toronto, Ontario Carrie Morris Toronto, Ontario Gigi Wong Toronto, Ontario Peter Hawkings Toronto, Ontario Andrew Ma Mississauga, Ontario Position Held with Manager Senior Managing Director, Investments & Global Head of Securities, and Director Ultimate Designated Person, Founding Managing Director, President, Chief Executive Officer and Director Managing Director, Corporate Development, and Director Managing Director, Capital Markets & Corporate Communications, and Director Chief Financial Officer Executive Director, General Counsel Chief Compliance Officer Other than ownership of units of the Continuing Fund, if any, none of the above individuals was indebted to or had any transaction arrangement with the Continuing Fund during the last fiscal year of the Continuing Fund. As at the date hereof, R. Blair Tamblyn and Ugo Bizzarri indirectly own more than 10% of the outstanding common shares of the Manager, each holding beneficially an approximate 22.85% ownership interest in the Manager. In addition, certain other officers and directors of the Manager own indirectly, in the aggregate, approximately 7.23% of the Manager. As at the date hereof, Sun Life Assurance Company of Canada owns 158,580 Series S units of the Continuing Fund, being 100% of the Series S units of the Continuing Fund. As at the date hereof, Paul Tsourounis owns 234 Series T units of the Continuing Fund, being 24.9% of the Series T units of the Continuing Fund. OTHER BUSINESS The Manager knows of no other business to be presented at the Meeting. If any additional matters should be properly presented, it is intended that the enclosed proxy will be voted in accordance with the judgment of the persons named in the proxy. ADDITIONAL INFORMATION Any additional information relating to the Terminating Fund or the Continuing Fund can be found on the SEDAR website at RECOMMENDATION REGARDING THE MERGER For the reasons set out above, the Manager strongly recommends that unitholders of the Continuing Fund vote FOR the proposed Merger. 9

14 CERTIFICATE The contents of this Circular and its distribution have been approved by the board of directors of Timbercreek Investment Management Inc., as the manager of the Continuing Fund. DATED at Toronto, Ontario, this 14 th day of November, By order of the Board of Directors of Timbercreek Investment Management Inc., as Trustee and Manager of the Continuing Fund By: R. Blair Tamblyn R. Blair Tamblyn President and Chief Executive Officer 10

15 SCHEDULE A RESOLUTIONS OF THE UNITHOLDERS OF TIMBERCREEK GLOBAL REAL ESTATE INCOME FUND (the Continuing Fund ) WHEREAS it is in the best interests of the Continuing Fund and its unitholders to merge Timbercreek Global Real Estate Fund (the Terminating Fund ) into the Continuing Fund and to wind up the Terminating Fund as hereinafter provided; BE IT RESOLVED THAT: 1. The merger of the Terminating Fund into the Continuing Fund (the Merger ) as described in the management information circular dated November 14, 2017 (the Circular ) be and the same is hereby authorized and approved; 2. Timbercreek Investment Management Inc. (the Manager ), as the manager and trustee of the Continuing Fund, be and is hereby authorized to: (a) (b) transfer all of the portfolio securities and other assets of the Terminating Fund in exchange for Series A units and Series F units of the Continuing Fund; and amend the Declaration of Trust of the Continuing Fund to the extent necessary to give effect to the foregoing. 3. Any one officer or director of the Manager be and is hereby authorized and directed, on behalf of the Continuing Fund, to execute and deliver all such documents and do all such other acts and things as may be necessary or desirable for the implementation of this resolution; and 4. The Manager be and is hereby authorized to revoke this resolution for any reason whatsoever in its sole and absolute discretion, without further approval of the unitholders of the Continuing Fund, at any time prior to the implementation of the changes described above if it is considered to be in the best interests of the Continuing Fund and its unitholders not to proceed. 11