Mr. Todd Hudson reports

AXIS PROVIDES UPDATE ON STRATEGIC REVIEW PROCESS

Axis Auto Finance Inc. has provided a strategic review update.

As indicated in the May 15, 2024, press release, the company entered into non-binding letters of intent with two separate, arm's-length parties for potential sales of the auto finance and equipment finance businesses. Updates on these two potential sales are provided herein.

Equipment finance sale transaction

On Aug. 16, 2024, Axis Equipment Finance Inc., a subsidiary within the Axis group of companies, executed and closed an asset purchase agreement with an arm's-length party.

The assets sold include intangibles, customer lists, the assumption of certain vendor contracts and the transfer of employees to the purchaser.

Concurrent with this transaction, under its two master purchase and servicing agreements (MPSAs) that hold its securitization financing facilities, the servicing of the underlying customer contracts has been transferred back to the underlying financers that underwrote the contracts pursuant to the MPSAs. Furthermore, Axis Equipment's syndicated and serviced portfolios have been assigned back to their respective purchasers, which will undertake their continuing collections and servicing.

With the close of this transaction, the company intends to liquidate the remaining working capital positions in Axis Equipment in an orderly manner and dissolve the legal entity.

Auto finance sale transaction

As indicated in the May 15, 2024, press release, Axis has entered into a non-binding letter of intent to sell the auto finance business. The prospective purchaser has now completed its due diligence, and an agreement has been reached on the structure of the sale, and the company is in the process of negotiating the definitive agreement in respect of the proposed transaction.

There can be no assurances that the transaction to sell the auto finance business will be completed or that a successful transaction will result from the strategic process. The company will provide further updates on the process as developments warrant.

About Axis Auto Finance Inc.

Axis is a fintech (financial technology) lender providing alternative used vehicle financing options to non-prime borrowers. Axis loans are offered through over 3,000 automotive dealers nationwide. Approximately 30 per cent of Canadians (source: Equifax) that have credit scores in the non-prime range. All Axis auto loans report to the credit bureau, resulting in over 70 per cent of customers seeing a significant improvement of their credit scores.