Mr. Sean Morrison reports

DIVERSIFIED ROYALTY CORP. ANNOUNCES $50 MILLION BOUGHT DEAL PUBLIC OFFERING OF COMMON SHARES

Diversified Royalty Corp. has entered into an agreement with a syndicate of investment dealers led by CIBC Capital Markets and ATB Cormark Capital Markets, pursuant to which the underwriters have agreed to purchase 10.73 million common shares from the treasury of the corporation, at a price of $4.66 per common share, for total gross proceeds of approximately $50-million.

In addition, the corporation has granted the underwriters an option to purchase up to an additional 1,609,500 common shares from the treasury of the corporation at the offering price for additional gross proceeds of up to approximately $7.5-million for market stabilization purposes and to cover overallotments, if any. The overallotment option is exercisable, in whole or in part, by the underwriters at any time up to 30 days following the closing of the offering.

The net proceeds of the offering will be used to repay outstanding amounts under Diversified Royalty's acquisition facility that was drawn in connection with Diversified Royalty's recent acquisition of the Mr. Lube + Tires franchisor business and for working capital and general corporate purposes.

The offering will be made by way of a prospectus supplement to the corporation's existing short form base shelf prospectus dated July 22, 2025. The prospectus supplement will be filed with the securities commissions in all of the provinces and territories of Canada, except Quebec. Access to the prospectus supplement, the base shelf prospectus and any amendment to the offering documents is provided in accordance with securities legislation relating to procedures for providing access to a shelf prospectus supplement, a base shelf prospectus and any amendment. The base shelf prospectus is, and the prospectus supplement will be (within two business days from the date hereof), accessible on SEDAR+. The offering documents will contain important detailed information about the securities being offered. An electronic or paper copy of the prospectus supplement, the base shelf prospectus and any amendment to such offering documents may be obtained without charge from CIBC Capital Markets at 161 Bay St. (fifth floor), Toronto, Ont., M5J 2S8, or by telephone at 1-416-956-6378 or by e-mail at mailbox.Canadianprospectus@cibc.com, or from ATB Cormark Capital Markets at Royal Bank Plaza, North Tower, Suite 1800, 200 Bay Street, Toronto, Ont., M5J 2J2, or by e-mail at: atbcm_ecm@atb.com, by providing the contact with an e-mail address or address, as applicable. Prospective investors should read the base shelf prospectus and the prospectus supplement (when filed) before making an investment decision.

Closing of the offering is expected to occur on or about July 6, 2026, and is subject to regulatory approval, including that of the Toronto Stock Exchange.

Recent updates

As announced on June 16, 2026, Diversified Royalty completed the acquisition of the Mr. Lube + Tires franchisor business for a gross purchase price of $235-million, subject to customary closing and postclosing adjustments.

Diversified Royalty is currently in non-binding discussions with Sutton Group Realty Services Ltd. with respect to potential amendments to the royalty arrangements between the parties to replace the current fixed royalty payments with variable royalty payments. Sutton is currently receiving 33.3-per-cent royalty relief from Diversified Royalty through to the end of December, 2026, pursuant to a previously disclosed royalty relief agreement. If the amended royalty arrangements are not entered into, Sutton may require additional royalty relief. As at June 30, 2026, Diversified Royalty may write down intangible assets related to Sutton based on estimated associated future cash flows.

About Diversified Royalty Corp.

Diversified Royalty is a multiroyalty corporation, engaged in the business of acquiring top-line royalties from well-managed multilocation businesses and franchisors in North America. Diversified Royalty's objective is to acquire predictable, growing royalty streams from a diverse group of multilocation businesses and franchisors. Diversified Royalty, through its subsidiary, Mr. Lube Canada Ltd., also operates the Mr. Lube + Tires franchisor business in Canada. Mr. Lube + Tires is the leading Canadian automotive service chain specializing in fast, drive-in drive-through, no-appointment-needed vehicle maintenance.

Diversified Royalty currently owns the Sutton, Mr. Mikes, Nurse Next Door, Oxford Learning Centres, Stratus Building Solutions, BarBurrito, Cheba Hut and AIR MILES trademarks, which Diversified Royalty licenses to its royalty partners. Sutton is among the leading residential real estate brokerage franchisor businesses in Canada. Mr. Mikes operates casual steakhouse restaurants primarily in Western Canadian communities. Nurse Next Door is a home care provider with locations across Canada and the United States, as well as in Australia. Oxford Learning Centres is one of Canada's leading franchisee supplemental education services. Stratus Building Solutions is a leading commercial cleaning service franchise company, providing comprehensive janitorial, building cleaning and office cleaning services primarily in the United States. BarBurrito is the largest quick-service Mexican restaurant food chain in Canada. Cheba Hut is a fast casual toasted sub sandwich franchise with locations in the United States. AIR MILES was a Canadian loyalty program.

Diversified Royalty's objective is to increase cash flow per share by making accretive royalty purchases and through the growth of both purchased royalties and the Mr. Lube + Tires franchisor business. Diversified Royalty intends to continue to pay a predictable and stable monthly dividend to shareholders and increase the dividend over time, in each case as cash flow per share allows.

We seek Safe Harbor.