Invitae Announces Convertible Notes and Share Exchange and New Convertible Notes Issuance

? In a transaction led by Deerfield Management, the Company effectively addresses ~96% of its 2024 convertible debt obligations ?

? Participating holders to exchange 90% of their existing 2024 notes for new notes due in 2028 and equitize 10% of their holdings; Certain investors will also provide an additional $30 million of capital ?

? The Company will discuss this announcement during its fourth quarter and full year 2022 earnings call at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time ?

SAN FRANCISCO, Feb. 28, 2023 /PRNewswire/ -- Invitae (NYSE: NVTA), a leading medical genetics company, today announced that it has signed exchange and financing agreements with a fund managed by Deerfield Management Company and other investors (collectively, the "Investors").

The privately negotiated agreements with the Investors' holdings of the Company's outstanding 2.00% Convertible Senior Notes due 2024 (the "Old Notes") calls for the exchange of approximately $306 million aggregate principal amount of the Old Notes into approximately $275 million aggregate principal amount of new 4.50% Series A Convertible Senior Secured Notes due 2028 (the "New Notes"), along with approximately 14.3 million shares of the Company's common stock (the "Shares"). Invitae will also sell $30 million of New Notes to the Investors for cash. These transactions are subject to customary closing conditions and are expected to close on or about March 7, 2023. The New Notes will be issued pursuant to an indenture.

"We are extremely pleased to have accomplished several important objectives for the Company and its stockholders with this transaction," said Ken Knight, president and chief executive officer of Invitae. "We have added $30 million in cash to our balance sheet and successfully refinanced the vast majority of our short-term obligations through 2028. With this demonstrated commitment from long-term financial investors, Invitae can focus on its goal of achieving positive cash flow and deliver on its mission to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people."

Based on the initial conversion price of $2.5740, the New Notes will be convertible into approximately 118.6 million shares of Common Stock, subject to the potential issuance of additional shares in certain events. Subject to certain requirements under the indenture, the Company will have the option to redeem all or any portion of the principal amount of the New Notes for cash and the issuance of warrants. The New Notes will be convertible at any time at the option of the holders thereof, subject to beneficial ownership cap and/or certain limitations imposed by the NYSE rules (if applicable) for any conversion into shares of Common Stock. The New Notes will be secured by a security interest in substantially all of the assets of the Company and its material subsidiaries and a pledge of the equity interests of the Company's direct and indirect subsidiaries.

"We are encouraged by the disciplined approach that Invitae has taken toward improving its operating metrics and balance sheet while continuing to invest to achieve its ambition to be a leader in applied genetics," said Avi Kometz, M.D., partner at Deerfield Management. "We view this financing as an important step in giving the Company the flexibility and runway to reach its goals."

The New Notes, the Shares and any shares of common stock issuable upon conversion of the New Notes have not been registered under the Securities Act of 1933, as amended, or under any state securities laws and may not be offered or sold without registration under, or an applicable exemption from, the registration requirements; provided that the New Notes (and underlying conversion shares) and Shares issued in exchange for the Old Notes will be freely tradeable by holders that are not affiliates of Invitae pursuant to Rule 144 under the Securities Act.

J. Wood Capital Advisors LLC, Goldman Sachs & Co. LLC, and Perella Weinberg Partners LP acted as financial advisors on the transaction. Latham & Watkins LLP acted as legal counsel to the Company in connection with the Transaction, Katten Muchin Rosenman LLP acted as legal counsel to Deerfield Management in connection with the Transaction, and Cooley LLP acted as legal counsel to the financial advisors in connection with the Transaction.

This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

Webcast and Conference Call Details

Management will discuss this announcement during its fourth quarter and full year 2022 earnings results call today at 4:30 p.m. Eastern Time / 1:30 p.m. Pacific Time. To access the conference call, please register at the link below:

https://www.netroadshow.com/events/login?show=d75171b5&confId=46549

Upon registering, each participant will be provided with call details and access codes.

The live webcast of the call and slide deck may be accessed here or by visiting the investors section of the Company's website at ir.invitae.com. A replay of the webcast will be available shortly after the conclusion of the call and will be archived on the Company's website.

About Invitae
Invitae (NYSE: NVTA) is a leading medical genetics company trusted by millions of patients and their providers to deliver timely genetic information using digital technology. We aim to provide accurate and actionable answers to strengthen medical decision-making for individuals and their families. Invitae's genetics experts apply a rigorous approach to data and research, serving as the foundation of their mission to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people.

To learn more, visit invitae.com and follow for updates on Twitter, Instagram, Facebook and LinkedIn @Invitae.

Safe Harbor Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the closing of the transaction, including the timing of and conditions to closing; the anticipated use of proceeds from the transaction; and any expected benefits from the transaction. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: risks related to whether the Company will be able to satisfy the conditions required to close the transaction; the fact that the Company's management will have broad discretion in the use of the proceeds from the transaction and risks and uncertainties related that use of proceeds; the potential impact of market and other general economic conditions; the ability of the Company to successfully execute its strategic business realignment plan and achieve the intended benefits thereof on the expected timeframe or at all; the Company's failure to manage growth effectively; the Company's failure to fully realize the anticipated benefits of the transaction; and the other risks set forth in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 and in the Company's subsequent filings with the Commission. These forward-looking statements speak only as of the date hereof, and the Company disclaims any obligation to update these forward-looking statements.

Contacts for Invitae:

Investor Relations
Hoki Luk
[email protected]

Public Relations
Amy Hadsock
[email protected] 

SOURCE Invitae Corporation