EVANSTON, Ill., Sept. 17, 2024 /CNW/ - Magnetar Financial LLC ("Magnetar") today announced the filing of an early warning report with respect to the ownership of securities in Invesque Inc. ("Invesque") by Magnetar Constellation Master Fund, Ltd, Magnetar Xing He Master Fund Ltd, Magnetar Andromeda Select Fund LLC, Magnetar Constellation Master Fund V Ltd, Magnetar Constellation Fund II, Ltd, and Magnetar Structured Credit Fund, LP (collectively, the "Exchanging Magnetar Funds") and Magnetar Constellation Master Fund IV, Ltd and Magnetar SC Fund Ltd (collectively with the Exchanging Magnetar Funds, the "Magnetar Funds").

On September 16, 2024, the Exchanging Magnetar Funds entered into an exchange agreement (the "Exchange Agreement") with Invesque, pursuant to which the Exchanging Magnetar Funds have agreed to exchange their class A convertible preferred shares ("Preferred Shares") (2,802,009 Series 1 Preferred Shares, 3,172,086 Series 2 Preferred Shares, 1,586,042 Series 3 Preferred Shares and 1,538,461 Series 4 Preferred Shares) for 674,705,882 common shares of Invesque ("Common Shares"), having a value of US$114,700,000 (C$155,911,710) based on a price per Common Share of US$0.17 (C$0.2311), being a 15% premium to the 15-day VWAP of the Common Shares as of September 13, 2024 (the "Preferred Share Exchange"). The Preferred Share Exchange will be subject to certain conditions, including the substantially contemporaneous closing of the Debenture Exchange (as defined below), approval of the Toronto Stock Exchange (the "TSX") and shareholder approval, as required under the rules of the TSX.

Invesque has announced in its separate press release of September 17, 2024 its intention to seek the approval of holders of its 7.00% Convertible Unsecured Subordinated Debentures due January 31, 2025, of which US$24,850,000 aggregate principal amount is currently outstanding (the "2025 Debentures"), and its 8.75% Convertible Unsecured Subordinated Debentures due September 30, 2026, of which US$43,415,000 aggregate principal amount is currently outstanding (the "2026 Debentures" and, collectively with the 2025 Debentures, the "Debentures"), to amend the terms of the indentures governing the Debentures at meetings of holders of each of the 2025 Debentures and 2026 Debentures (the "Debenture Amendments"). Among other things, the Debenture Amendments would add covenants that the outstanding principal amount of the Debentures would be exchanged for an aggregate of 130,541,175 Common Shares and new unsecured subordinated debentures of Invesque (the "Debenture Exchange"). Subject to satisfaction of the closing conditions in respect thereof, the Debenture Exchange and the Preferred Share Exchange are expected to occur prior to January 31, 2025.

Based on securities outstanding and held on the date hereof, prior to the Preferred Share Exchange and the Debenture Exchange, Magnetar, together with the Magnetar Funds, would own and exercise control over (i) 14,558,121 Common Shares, representing approximately 25.89% of the outstanding Common Shares, and (ii) 9,098,598 Preferred Shares (2,802,009 Series 1 Preferred Shares, 3,172,086 Series 2 Preferred Shares, 1,586,042 Series 3 Preferred Shares and 1,538,461 Series 4 Preferred Shares), representing all of the outstanding Preferred Shares of all series. Based on securities outstanding and held on the date hereof, prior to the Preferred Share Exchange and the Debenture Exchange, assuming the voluntary conversion of all of such 9,098,598 Preferred Shares and taking into account the liquidation preference accretion pursuant to the terms of the Preferred Shares as of June 30, 2024, Magnetar and the Magnetar Funds would own and exercise control over an aggregate of 28,022,578 Common Shares, representing approximately 40.21% of the outstanding Common Shares. Based on securities outstanding and held on the date hereof, as a result of the Preferred Share Exchange, the Exchanging Magnetar Funds would acquire an aggregate of 674,705,882 Common Shares, representing approximately 78.32% of the outstanding Common Shares after giving effect to the Preferred Share Exchange and the Debenture Exchange. Immediately following the Preferred Share Exchange and the Debenture Exchange, Magnetar and the Magnetar Funds would own and exercise control over 689,264,003 Common Shares, representing approximately 80.01% of the outstanding Common Shares. Other than the Preferred Shares subject to the Preferred Share Exchange, Magnetar and the Magnetar Funds do not own or exercise control over securities convertible into or exchangeable for securities of Invesque or other rights to acquire securities of Invesque.

All of the Common Shares and Preferred Shares currently owned by Magnetar and the Magnetar Funds were acquired, and the Common Shares to be issued to the Exchanging Magnetar Funds in connection with the Preferred Share Exchange will be acquired, for investment purposes and, in the future, Magnetar and the Magnetar Funds may discuss with management and/or the board of directors of Invesque any of the transactions listed in clauses (a) to (k) of item 5 of Form F1 to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues and they may further purchase, hold, vote, trade, dispose of or otherwise deal in the securities of Invesque, in such manner as they deem advisable to benefit from changes in market prices of Invesque's securities, publicly disclosed changes in the operations of Invesque, their business strategy or prospects or from a material transaction of Invesque, and they will also consider the availability of funds, evaluation of alternative investments and other factors they may deem relevant.

Pursuant to the Exchange Agreement, Invesque, Magnetar and the Magnetar Funds will enter into an investor rights agreement (the "IRA"), providing for, among other things, the following rights of Magnetar and the Magnetar Funds: (i) board nomination rights in respect of a certain number of directors of Invesque (based on the size of the Invesque board and the securityholder percentage of Magnetar and the Magnetar Funds at the relevant times), (ii) customary demand and piggyback registration rights, (iii) customary pre-emptive rights with respect to equity securities of Invesque, and (iv) approval and consent rights in respect of certain actions of Invesque. The IRA will also provide for certain standstill restrictions on Magnetar and the Magnetar Funds until March 31, 2025.

A copy of the early warning report filed by Magnetar in accordance with applicable securities laws is available on SEDAR+ under Invesque's profile at and may be obtained directly from Magnetar upon request at the email address below. Invesque's registered office is located at 700 W Georgia Street, 25th Floor, Vancouver, British Columbia V7Y 1B3 and its head office is located at 333 Bay Street, Suite 3400, Toronto, Ontario, M5H 2S7. The address of each of the Magnetar Funds is c/o Magnetar Financial LLC, 1603 Orrington Avenue, Suite 1300, Evanston IL 60201 USA.

Forward-Looking Information

Certain statements in this press release constitute forward-looking information within the meaning of applicable securities laws, including statements with respect to the closing of the transactions contemplated herein, their expected effects, and future intentions regarding the securities of Invesque owned by Magnetar and the Magnetar Funds. Such statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Magnetar is not under any obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable law.

SOURCE Magnetar Financial LLC