Mr. Samir Manji reports

ARTIS REAL ESTATE INVESTMENT TRUST AND RFA CAPITAL ("RFA") AGREE TO COMBINE TO FORM RFA FINANCIAL THROUGH A SHARE EXCHANGE TRANSACTION

Artis Real Estate Investment Trust and RFA Capital Holdings Inc., a privately held Canadian financial service organization, have entered into an agreement pursuant to which the parties will combine and RFA will acquire all of the outstanding units of Artis through a court-approved plan of arrangement.

Founded in 1996 and based in Toronto, RFA is a growing Canadian financial service organization, known for providing innovative financing solutions to the residential and commercial real estate sectors. RFA's primary business is a licensed bank, RFA Bank of Canada, which held over $2.5-billion in assets as of June 30, 2025. To diversify its offerings, RFA also operates a mortgage finance subsidiary, RFA Mortgage Corp., which originated over $2.9-billion in residential mortgages over the 12 months ended June 30, 2025.

Following completion of the transaction, Artis will become a subsidiary of RFA, and RFA will operate as RFA Financial. Holders of Artis common units will receive one common share of RFA Financial for each Artis unit held immediately prior to the effective time of the transaction, subject to customary adjustments set out in the arrangement agreement. Additionally, subject to the terms of the arrangement agreement, including Artis preferred unitholder approval voting as separate classes, holders of Artis preferred units, Series E and Series I, will receive one preferred share of RFA Financial, having the same terms and conditions as the Artis preferred units held immediately prior to the effective time of the transaction. Closing of the transaction is not conditional on the approval of Artis preferred unitholders. Pursuant to the transaction, the parties will seek listing of RFA Financial common shares and, if approved by Artis preferred unitholders, RFA Financial preferred shares on the Toronto Stock Exchange.

As a result of the transaction, current holders of Artis common units will own 68 per cent of the common shares of RFA Financial, while current holders of common shares of RFA will own the remaining 32 per cent of the common shares of RFA Financial. Upon closing, Ben Rodney, current chair of Artis and president, chief executive officer and managing partner of RFA, will be appointed president and CEO of RFA Financial, and Samir Manji will be appointed executive chair of the board of directors of RFA Financial. Furthermore, Jaclyn Koenig, chief financial officer of Artis, will be appointed as chief financial officer of RFA Financial, and Melody Lo, managing partner of RFA, will be appointed as chief operating officer of RFA Financial. The management team will be complemented by a board of directors consisting of Mr. Rodney (in his capacity as CEO of RFA Financial), five directors identified by Artis (including Mr. Manji) and three directors identified by RFA.

"By combining Artis with RFA, we are creating a scalable and growing financial services platform that benefits from diversification and built-in access to substantial growth capital," said Mr. Manji. "Following our decision to end Artis's strategic review process in December, 2024, the board of trustees and management have continued to explore innovative ways of enhancing unitholder value, and we believe this transaction achieves that goal. We are very excited to be partnering with Mr. Rodney and the team at RFA. Ben and his team have built an extraordinary organization and business over the past three decades. We believe RFA's various platforms, including RFA Bank of Canada and RFA Mortgage Corp., are ripe for significant growth harnessing the substantial capital currently embedded in the Artis real estate portfolio. We believe that under Ben's leadership, scaling RFA's various businesses represents significant upside potential and value creation opportunity for the owners of Artis and RFA."

"We see a highly attractive opportunity to grow RFA's balance sheet and invest in existing and new product capabilities. Having served on the board of trustees since June, 2019, I have developed a deep appreciation for Artis's asset management capabilities and the strength of its real estate portfolio," said Mr. Rodney. "As Artis continues to monetize its real estate holdings over the coming years, it is expected to release meaningful amounts of capital that can be redeployed into compelling investment opportunities. I am excited and committed to lead the combined enterprise through the next evolution of the RFA and Artis platforms."

Transaction rationale

Creation of a leading, bank-led financial service platform

The combined company will form a scaled and diversified financial service entity focused on its growing Schedule 1 bank. Unique in the Canadian marketplace, the merger will combine a growing Canadian bank and mortgage finance company with a diversified real estate portfolio. Artis unitholders are expected to continue to benefit from attractive cash flows generated from Artis's commercial real estate portfolio and will also realize enhanced returns as capital generated from commercial real estate asset sales is redeployed into the RFA Financial bank and mortgage platforms.

Attractive value creation opportunity through capital reallocation

Over the coming years, RFA Financial is expected to continue to rationalize its commercial real estate portfolio, generating substantial net proceeds from asset sales. While the expectation is to offer investors a stable and attractive dividend, the combined platform also intends to reinvest asset sale proceeds to support the growth opportunities in RFA Financial's expanding financial service platform. These investments are expected to generate materially higher returns on invested capital than would be possible if invested in commercial real estate assets. The combination provides the opportunity for compound earnings growth at a faster rate than would be achievable as a stand-alone real estate investment trust.

Multiple avenues for growth

RFA Financial will benefit from numerous paths to drive enhanced investor returns by investing in attractive growth opportunities in the Canadian financial service sector. RFA Financial intends to explore both organic and inorganic alternatives, with shareholder returns expected to be further supplemented by a sustaining and growing dividend. With a broad opportunity set identified, management will take a disciplined approach to capital allocation, deploying capital into the highest risk-adjusted return alternatives.

Accretive transaction supporting shareholder returns

The transaction is expected to accelerate growth and enhance the cash flow profile of RFA Financial. It is anticipated to be accretive to net income and cash flow generation over time, supporting long-term value creation and shareholder returns.

Provides exposure to the Canadian financial service sector

The combination will provide Artis unitholders with exposure to the highly attractive Canadian financial service sector through the ownership of RFA Bank of Canada, a licensed, Schedule 1 banking institution regulated by the Office of the Superintendent of Financial Institutions, and RFA Mortgage, a growing residential mortgage origination business. Canadian banking institutions have a demonstrated record of generating durable, double-digit returns on equity for investors throughout business cycles. Additionally, RFA Mortgage is expected to continue to generate a growing income stream as it continues to expand its operations in the domestic mortgage market.

Strengthened management team and board of directors

The combined company will leverage the expertise of both leadership teams, combining the significant real estate knowledge and public market expertise of Artis with experienced private market operators at RFA, which have a successful record of prudent capital allocation. The management teams combine a deep bench of seasoned executives across the various platforms, with senior leadership from both existing entities providing continuity.

As president and CEO of RFA Financial, Mr. Rodney brings 25-plus years of real estate lending and financial service experience, including as chair of the Artis board of trustees. Melody Lo, managing partner of RFA, will provide operational continuity to RFA Financial as its COO and benefits from a breadth of experience in senior roles at multiple publicly traded entities prior to joining RFA.

Samir Manji, the current president, CEO and trustee of Artis, will continue to bring his proven record and operational capabilities to RFA Financial as the executive chair of the board of directors.

Jaclyn Koenig, current CFO of Artis, will become the CFO of RFA Financial, and Kara Watson, current executive vice-president, general counsel and corporate secretary of Artis, will become EVP, legal, and corporate secretary of RFA Financial.

Expected dividend policy

RFA Financial intends to pay a quarterly cash dividend to shareholders, initially set at 11 cents per share, representing 44 cents per share on an annualized basis. RFA Financial's dividend policy will be to provide shareholders with a stable and predictable income stream, while also reinvesting for growth. It is the intention that dividends will increase as earnings grow, providing investors with an increasing return of capital over time (subject to performance and approval by the RFA Financial board of directors).

RFA Financial preferred shares will receive a dividend equivalent to the current distribution rate received from the existing Artis preferred units. The transaction is expected to provide current Artis preferred unitholders with a dividend that is supported by a larger enterprise benefiting from large and more diversified income streams.

The above dividends are expected to be eligible dividends for taxable Canadian shareholders, providing favourable tax treatment.

Significant unitholder support

Artis unitholders representing approximately 39.2 per cent of the total issued and outstanding common units of Artis (on an undiluted basis), including Sandpiper Group, Halcyon International Ltd. and Steven Joyce, and each of the trustees and officers of Artis has entered into voting support agreements whereby they agree to vote their units in favour of the transaction.

"Halcyon is committed to supporting the transaction. As one of the significant unitholders of Artis, we are confident this transaction presents a compelling opportunity to unlock long-term value for current unitholders by combining the scale of the Artis platform with the superior growth profile of RFA. As a substantial shareholder of RFA, we are excited about the prospects of transitioning RFA Financial into a leader in the industry," said Steven Joyce, president and chief executive officer of Halcyon, a significant securityholder of Artis and RFA.

Under the irrevocable voting support agreements signed by Sandpiper Group, Halcyon, Mr. Joyce, Mr. Manji and Mr. Rodney, who collectively hold approximately 39.0 per cent of the total issued and outstanding common units of Artis (on an undiluted basis), such persons are also precluded from supporting any other acquisition proposal relating to Artis on the conditions described in the arrangement agreement. The voting support agreements entered into by each trustee and officer of Artis, other than those entering into irrevocable voting support agreements, terminate automatically upon termination of the arrangement agreement or a change of recommendation by Artis's board of trustees made in accordance with the terms of the arrangement agreement.

Lock-up agreements

Artis unitholders representing approximately 22.1 per cent of the total issued and outstanding common units of Artis (on an undiluted basis), including Mr. Manji, Mr. Rodney and Halcyon, have entered into lock-up agreements with Artis, and RFA shareholders representing approximately 33.0 per cent of the total issued and outstanding shares of RFA, including Mr. Rodney, Mr. Joyce and Halcyon, have entered into lock-up agreements with RFA. Pursuant to the lock-up agreements, such Artis unitholders and RFA shareholders have agreed not to sell, transfer or otherwise dispose of the common shares of RFA Financial, for a period of 180 days following the effective date.

Medium-term targets

The business plan targets significant growth in the bank-led platform through investments in high-return-on-equity opportunities financed by proceeds from asset sales within the Artis real estate portfolio. As this strategy is executed on, RFA Financial is targeting the following key performance indicators for the three- to five-year period following the closing of the transaction:

• Total lending assets: $8.0-billion to $12.0-billion;
• RFA bank return on equity: low- to mid-teen double-digit percentage;
• Cumulative asset sales: $1.3-billion to $1.5-billion;
• RFA bank net income compound annual growth rate (compound annual growth rate): 40 per cent to 50 per cent;
• Earnings per share payout ratio target: less than 65 per cent.

Transaction details

Pursuant to the arrangement agreement, RFA will acquire all the units of the REIT through a share exchange, whereby each Artis unit will be exchanged for one RFA Financial common share, and, if approved by Artis preferred unitholders, each Artis preferred unit will be exchanged for one RFA Financial preferred share (in each case subject to customary adjustments set out in the arrangement agreement) by way of a statutory plan of arrangement under the provisions of the Business Corporations Act (Ontario). The transaction is expected to close in the first quarter of 2026 following the timely receipt of all required securityholder, regulatory and court approvals.

The arrangement agreement includes customary deal protections, including reciprocal non-solicitation provisions, with fiduciary-out provisions that allow the parties to terminate the arrangement agreement to accept an unsolicited superior proposal in certain circumstances. Additionally, a termination fee of $25-million is payable by Artis or RFA, respectively, in certain circumstances, including in connection with a superior proposal, as described in the arrangement agreement.

Artis unitholders and Artis preferred unitholders are expected to continue to receive their regular monthly and quarterly distributions, respectively, in the ordinary course until the transaction is completed.

Following the closing of the transaction, Artis will be delisted from the Toronto Stock Exchange, and it is anticipated that Artis will apply to cease to be a reporting issuer. In connection with the transaction, RFA Financial will apply to have its common shares and, if approved, preferred shares listed on the TSX.

In the event that one or both series of Artis preferred unitholders do not approve the transaction, all of the Artis preferred units will remain outstanding (provided that Artis may, in its discretion, allow only the series of Artis preferred units approving the transaction to be exchanged for RFA Financial preferred shares), and Artis will continue to be a reporting issuer and continue to maintain its status as a mutual fund trust and a real estate investment trust under the Income Tax Act (Canada).

The description of the arrangement agreement herein is qualified in its entirety by the provisions of the arrangement agreement, a copy of which will be filed under Artis's profile on SEDAR+.

In connection with the closing of the transaction, RFA Financial expects to complete a one-for-three share consolidation. The figures included in this press release are on a preconsolidation basis.

Required approvals

The transaction will require the approval of at least two-thirds of votes cast by Artis unitholders and, if required, a simple majority of the votes cast by Artis unitholders other than the votes of unitholders excluded for the purposes of any minority approval under Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions) at a special meeting of Artis unitholders. In addition, Artis will seek the approval of at least two-thirds of the votes cast by holders of outstanding preferred units of Artis, Series E and Series I, voting as separate classes. If Artis preferred unitholder approval is obtained and the other closing conditions are satisfied, each Artis preferred unit will be exchanged for one RFA Financial preferred share with substantially the same commercial terms and conditions as the Artis preferred units. The transaction is not conditional on Artis preferred unitholder approval, and, if not obtained, the Artis preferred units will remain outstanding beneficial interests of Artis, which will be a subsidiary entity of RFA Financial. It is expected that Artis will prepare and send a management information circular to Artis unitholders in due course, which will be available under Artis's profile on SEDAR+.

Additionally, the transaction will require the approval of at least 66-2/3rds per cent of votes cast by RFA shareholders at a special meeting of RFA shareholders.

The transaction is also subject to court approvals and customary regulatory approvals.

Special committee and board recommendations

The trustees of Artis (other than the interested trustee) and the directors of RFA (other than interested directors) have determined, after consultation with their respective financial and legal advisers, and following recommendations by the special committee of the board of trustees of Artis and the special committee of the board of directors of RFA, the transaction is in the best interests of Artis and RFA, respectively. Accordingly, the board of trustees of Artis (other than the interested trustee) and the board of directors of RFA (other than interested directors) have, acting on the unanimous recommendations of the Artis special committee and RFA special committee, respectively, unanimously approved the transaction, and each recommends that Artis unitholders, Artis preferred unitholders and RFA shareholders, respectively, vote in favour of the transaction. Additionally, the trustees and officers of Artis, and the directors and officers of RFA, have entered into voting support agreements pursuant to which they have agreed to vote in favour of the special resolutions approving the transaction at the respective special meetings of the unitholders of Artis and shareholders of RFA.

CIBC World Markets Inc. has provided fairness opinions to the board of trustees of Artis and Artis special committee that, as of the dates thereof and subject to the assumptions, limitations and qualifications set forth therein, the exchange ratio applying to the Artis unitholders and the consideration to be received by Series E and Series I preferred Artis unitholders are fair, from a financial point of view to such Artis unitholders. Furthermore, Haywood Securities Inc. has provided an independent fairness opinion to the board of trustees of Artis and Artis special committee that, as of the date of such opinion, subject to the assumptions, limitations and qualifications contained therein, the applicable exchange ratios are fair, from a financial point of view, to holders of Artis common units and holders of Artis preferred units, Series E and Series I.

Copies of each of the fairness opinions, as well as the additional details regarding the terms and conditions of the transaction and the rationale for the recommendation made by the board of trustees of Artis and the Artis special committee will be set out in the management information circular to be sent in connection with the transaction and filed by Artis on its SEDAR+ profile.

Conference call and webcast details

A conference call with management will be held on Monday, Sept. 15, 2025, at 10 a.m. CT (11 a.m. ET). To participate, please dial 1-437-900-0527 or 1-888-510-2154. You will be required to identify yourself and the organization on whose behalf you are participating.

Alternatively, you may access the simultaneous webcast by following the link from Artis's website. Prior to the webcast, you may follow the link to confirm you have the right software and system requirements.

If you cannot participate on Monday, Sept. 15, 2025, a replay of the conference call will be available by dialling 1-289-819-1450 or 1-888-660-6345 and entering passcode 28046 followed by the number sign. The replay will be available until Wednesday, Oct. 15, 2025. The webcast will be archived 24 hours after the end of the conference call and will be accessible for 90 days.

Advisers

CIBC World Markets Inc. is acting as financial adviser to Artis and has provided fairness opinions to the board of trustees of Artis and Artis special committee in connection with the transaction. Norton Rose Fulbright Canada LLP is acting as legal adviser to Artis. Haywood Securities has provided an independent fairness opinion to the board of trustees of Artis and Artis special committee in connection with the transaction.

BMO Capital Markets is acting as financial adviser to RFA in connection with the transaction. Borden Ladner Gervais LLP is acting as legal adviser to RFA.

Torys LLP is acting as counsel to the special committee of the board of directors of RFA Bank of Canada, a subsidiary of RFA, in connection with the transaction.

About Artis Real Estate Investment Trust

Artis is a diversified Canadian real estate investment trust with a portfolio of industrial, office and retail properties in Canada and the United States.

About RFA Capital Holdings Inc.

Founded in 1996, RFA is a Canadian-owned real estate investment firm. RFA specializes in residential mortgage lending and asset management through its subsidiaries: RFA Bank of Canada, a federally regulated Schedule 1 bank, RFA Mortgage, TM Investments and Five Continents Financial. Combined, RFA offers mortgage brokers a one-stop shop with a full suite of competitive prime, alternative, private, commercial mortgages and wealth management.

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