SOT.UN Slate Office REIT

Slate Office REIT (TSX: SOT.UN) (the “REIT”), an owner and operator of office real estate, announced today a Firm Offer1 to acquire an Irish entity and the closing of its previously announced public offering of 11,225,000 subscription receipts of the REIT (“Subscription Receipts”) at a price of C$4.90 per Subscription Receipt for gross proceeds of approximately C$55.0 million and C$75.0 million aggregate principal amount of 5.50% extendible convertible unsecured subordinated debentures (the “Debentures”) (collectively, the “Offering”). The Offering was conducted on a bought deal basis by a syndicate of underwriters led by RBC Capital Markets and BMO Capital Markets. The Subscription Receipts and the Debentures will commence trading today on the Toronto Stock Exchange under the ticker symbols SOT.R and SOT.DB.A, respectively.

Through a cross currency interest rate swap, the REIT has exchanged the Canadian dollar denominated principal and interest payments for C$75.0 million of the Debentures to Euro denominated principal and interest payments, resulting in an effective interest rate to the REIT of approximately 3.715%._____________1 Firm Offer is defined herein as a firm intention to make an offer under Rule 2.5 of the Irish Takeover Rules.

Together with the previously announced C$5.8 million private placement (the “Private Placement”) to Slate Asset Management L.P. (“Slate”), which is expected to close concurrent with closing of the Proposed Acquisition (as defined below), the total gross proceeds of the Offering and Private Placement are expected to be approximately C$135.8 million. Slate will maintain its approximate 9.5% effective interest in the REIT through ownership of Units and Class B LP Units following completion of the Private Placement and the Offering.

Having closed the Offering, the REIT, in conjunction with its wholly owned subsidiary, has made the Firm Offer to acquire all of the issued and outstanding shares of Yew Grove REIT plc (an Irish-incorporated real estate investment trust that is dual-listed on Euronext Dublin (Ireland) and the AIM market of the London Stock Exchange) (“Yew Grove”), for cash consideration of €1.017 per share (the "Proposed Acquisition"). This follows the REIT’s announcement on November 15, 2021 that it had reached agreement with Yew Grove on the terms of a proposed cash offer for Yew Grove in respect of which, subject to the closing of the Offering, the REIT would make the firm offer to acquire Yew Grove.

The Proposed Acquisition remains conditional on, amongst other things, the approval of Yew Grove’s shareholders. The Board of Yew Grove have confirmed their recommendation of the Proposed Acquisition.

The Firm Offer in respect of the Proposed Acquisition was announced today by the REIT and Yew Grove by way of an announcement of a firm intention to make an offer in accordance with the requirements of Rule 2.5 of the Irish Takeover Panel Act 1997, Takeover Rules 2013 (the "Irish Takeover Rules"). A copy of that announcement can be accessed on the REIT's website at slateofficereit.com/regulatory-filings.

Subject to the satisfaction of certain conditions, the Acquisition is expected to close in Q1 2022.

DETAILS OF THE OFFERING AND PRIVATE PLACEMENTOn closing of the Proposed Acquisition, subject to the satisfaction of all escrow release conditions: (i) one trust unit of the REIT (the “Unit”) will be automatically issued in exchange for each Subscription Receipt (subject to customary anti-dilution adjustments), without payment of additional consideration or further action by the holder thereof, (ii) an amount per Subscription Receipt equal to the amount per Unit of any cash distributions made by the REIT for which record dates have occurred during the period from and including November 19, 2021, to and including the date immediately preceding the date Units are issued, or deemed to be issued, to holders, net of any applicable withholding taxes, will become payable in respect of each Subscription Receipt, and (iii) the net proceeds from the sale of the Subscription Receipts and the Debentures will be released from escrow to or as directed by the REIT.

The Debentures bear an interest rate of 5.50% per annum, payable semi-annually in arrears on June 30 and December 31 in each year commencing June 30, 2022. The June 30, 2022 interest payment will represent accrued interest for the period from closing of the Offering to June 30, 2022. The maturity date for the Debentures will initially be the date upon which a Termination Event (as defined below) occurs (the “Initial Maturity Date”). If the Proposed Acquisition closing occurs prior to the occurrence of a Termination Event, the maturity date for the Debentures will automatically be extended to December 31, 2026 (the “Final Maturity Date”). Provided that the maturity date for the Debentures has been automatically extended to the Final Maturity Date, each Debenture will be convertible into Units at the option of the holder at a conversion rate of approximately 153.8462 Units per C$1,000 principal amount of Debentures, which is equal to a conversion price of C$6.50 per Unit.

Upon the occurrence of a Termination Event, the gross proceeds of the Offering and pro rata entitlement to interest earned or deemed to be earned on the Subscription Receipts, net of any applicable withholding taxes, will be paid to holders of the Subscription Receipts, and the Subscription Receipts will be cancelled.

A “Termination Event” means the earliest to occur of any of: (i) the failure to satisfy (or to be deemed to have satisfied) the escrow release conditions on or before 5:00 p.m. (Toronto time) March 4, 2022 as such date may be extended upon written agreement by the REIT and the Lead Underwriters, (ii) the REIT delivering to the Lead Underwriters a notice declaring that the Proposed Acquisition has been terminated or that the REIT will not be proceeding with the Proposed Acquisition, or (iii) the REIT formally announcing to the public by way of a press release that it does not intend to proceed with the Proposed Acquisition.

About Slate Office REIT (TSX: SOT.UN)

Slate Office REIT is an owner and operator of office real estate. The REIT owns interests in and operates a portfolio of 32 strategic and well-located real estate assets across Canada's major population centres and includes two assets in downtown Chicago, Illinois. 61% of the REIT’s portfolio is comprised of government or credit rated tenants. The REIT acquires quality assets and creates value for unitholders by applying hands-on asset management strategies to grow rental revenue, extend lease term and increase occupancy. Visit slateofficereit.com to learn more.

About Slate Asset ManagementSlate Asset Management is a global alternative investment platform focused on real estate. We focus on fundamentals with the objective of creating long-term value for our investors and partners. Slate’s platform spans a range of investment strategies, including opportunistic, value add, core plus and debt investments. We are supported by exceptional people and flexible capital, which enables us to originate and execute on a wide range of compelling investment opportunities. Visit slateam.com to learn more.

Statements required by the Irish Takeover RulesThe trustees of the REIT accept responsibility for the information contained in this announcement. To the best of the knowledge and belief of the trustees of the REIT (who have taken all reasonable care to ensure that this is the case) the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.

Forward-Looking StatementsCertain information herein constitutes “forward-looking information” as defined under Canadian securities laws which reflect management’s expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects and opportunities of the REIT. Some of the specific forward-looking statements contained herein include, but are not limited to, statements with respect to the intention of the REIT to complete the closing of the Proposed Acquisition, the Private Placement and the related transactions contemplated herein on the terms and conditions described herein, the effect of the Proposed Acquisition, the Offering, the Private Placement and the related transactions contemplated herein on the financial performance of the REIT, the expected timing for completion of the Proposed Acquisition, the closing date of the Private Placement and the use of proceeds of the Offering and the Private Placement. The words “plans”, “expects”, “does not expect”, “scheduled”, “estimates”, “intends”, “anticipates”, “does not anticipate”, “projects”, “believes”, or variations of such words and phrases or statements to the effect that certain actions, events or results “may”, “will”, “could”, “would”, “might”, “occur”, “be achieved”, or “continue” and similar expressions identify forward-looking statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations.

Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable by management as of the date hereof, are inherently subject to significant business, economic and competitive uncertainties and contingencies. When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ, possibly materially, from the results discussed in the forward-looking statements. Additional information about risks and uncertainties is contained in the filings of the REIT with securities regulators.

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For Further InformationInvestor Relations+1 416 644 4264ir@slateam.com