MHR Fund Management LLC files amended Early Warning Report for Telesat Corporation

NEW YORK, July 9, 2026 /CNW/ - Today, MHR Fund Management LLC ("Fund Management") filed an early warning report in accordance with Section 5.2(2)(b) of National Instrument 62-104 – Take-Over Bids and Issuer Bids (the "Early Warning Report") to amend its existing early warning report for the Fund Management's investment in Telesat Corporation ("Telesat"), including through its interest in Telesat Partnership LP (the "Partnership"). The report was filed in conjunction with Fund Management's Schedule 13D filing with the U.S. Securities and Exchange Commission as of the date hereof, a copy of which is available on EDGAR at www.sec.gov. 

The Early Warning Report updates information disclosed in previous early warning reports filed by the Acquiror (as defined herein) on May 14, 2024 and on November 22, 2021 (the "2021 Report").

Item 1 - Security and Reporting Issuer

1.1 State the designation of securities to which this report relates and the name and address of the head office of the issuer of the securities.

This report relates to Class B units ("Class B Units") of Telesat Partnership LP (the "Partnership") and Class B variable voting shares ("Class B Shares") of Telesat Corporation (the "Company" or the "Issuer"). The head office of each of the Partnership and the Company is located at:

160 Elgin Street, Suite 2100
Ottawa, Ontario K2P 2P7, Canada

1.2 State the name of the market in which the transaction or other occurrence that triggered the requirement to file this report took place.

Not applicable.

Item 2 - Identity of the Acquiror

2.1 State the name and address of the acquiror.

MHR Fund Management LLC (the "Acquiror")
40 West 57th Street, Floor 24
New York, NY, 10019

The Acquiror is a Delaware limited liability company.

2.2 State the date of the transaction or other occurrence that triggered the requirement to file this report and briefly describe the transaction or other occurrence.

On July 8, 2026, MHR Institutional Partners II LP ("Institutional Partners II"), MHR Institutional Partners IIA LP ("Institutional Partners IIA") and MHR Institutional Partners III LP ("Institutional Partners III LP" and together with Institutional Partners II and Institutional Partners IIA, the "Participating MHR Funds") and certain other affiliated entities consummated a series of transactions (collectively, the "CV Transaction") whereby the Participating MHR Funds transferred the Class B Units held by them to certain continuation vehicles that continue to be controlled by Dr. Rachesky, the Acquiror and entities under their control.

In connection with the CV Transaction, each limited partner in Institutional Partners II, Institutional Partners IIA and Institutional Partners III was offered the option to either (1) receive cash in respect of their indirect interests in Class B Units and indirect interests in another unrelated company (the "Other Portfolio Company Investment") held by such limited partner through the Participating MHR Funds or (2) rollover their indirect interests in Class B Units and the Other Portfolio Company Investment held by such limited partner through the Participating MHR Funds.

In connection with the consummation of the CV Transaction on July 8, 2026, certain Class B Units were transferred, through a series of related transactions steps, from Institutional Partners II, Institutional Partners IIA and Institutional Partners III to MHR SAT Holdco A LP ("SAT Holdco A"), MHR SAT SubHoldco A LP ("SAT SubHoldco A"), MHR SAT Holdco B LP ("SAT Holdco B") and MHR SAT SubHoldco B LP ("SAT SubHoldco B"). These transfers were made in respect of the indirect interests in Class B Units held by the limited partners of Institutional Partners II, Institutional Partners IIA and Institutional Partners III that elected to exercise the cash option described above. Each of SAT Holdco A, SAT SubHoldco A, SAT Holdco B and SAT SubHoldco B are newly formed special purpose vehicles managed by the Acquiror and controlled by MHR Sun GP LLC ("MHR Sun GP") (as its general partner), which is in turn controlled by The Rachesky Revocable Trust (the "Trust") (as MHR Sun GP's managing member). SAT Holdco A, SAT SubHoldco A, SAT Holdco B and SAT SubHoldco B were indirectly funded by funds affiliated with RenWave Kore LLC (together with its affiliated funds, the "Lead Investor") and MHR Sun Holdings LP ("MHR Sun Holdings"), a holding company controlled by Dr. Rachesky.

The transfers of Class B Units from Institutional Partners II to MHR Sun II LP ("MHR Sun II"), from Institutional Partners IIA to MHR Sun IIA LP ("MHR Sun IIA") and from Institutional Partners III to MHR Sun III LP ("MHR Sun III") were made in respect of the indirect interests in Class B Units held by the limited partners of Institutional Partners II, Institutional Partners IIA and Institutional Partners III that elected to exercise the rollover option described above. Each of MHR Sun II, MHR Sun IIA and MHR Sun III are managed by the Acquiror and controlled by MHR Institutional Advisors II LLC (in the case of MHR Sun II and MHR Sun IIA) and MHR Institutional Advisors III LLC (in the case of MHR Sun III). 

Item 3 - Interest in Securities of the Reporting Issuer

3.1 State the designation and number or principal amount of securities acquired or disposed of that triggered the requirement to file this report and the change in the acquiror's securityholding percentage in the class of securities.

See item 2.2 above. There was no change in the Acquiror's securityholding percentages in the Class B Units or Class B Shares as a result of the CV Transaction.

3.2 State whether the acquiror acquired or disposed ownership of, or acquired or ceased to have control over, the securities that triggered the requirement to file this report.

See item 3.1 above.

3.3 State the designation and number or principal amount of securities and the acquiror's securityholding percentage in the class of securities, immediately before and after the transaction or other occurrence that triggered the requirement to file this report.

For purpose of calculating the percentages in this item 3.5, the Reporting Persons have assumed that 51,003,269 Issuer Voting Securities are issued and outstanding. This is based on 14,730,782 Class A Common Shares and Class B Variable Voting Shares, 112,841 Class C Shares, and 36,159,646 Class A Units, Class B Units and Class C Units, reported to be outstanding at December 31, 2025 (as reported on the Issuer's Form 20-F on March 17, 2026). 

The Acquiror beneficially owns, through the MHR Funds,18,035,092 Class B Units, representing approximately 35.4% of the outstanding Class B Shares. In addition, Dr. Rachesky owns 15,000 Class B Units, representing approximately 0.08% of the outstanding Class B Units, and 46,136 Class B Shares, representing approximately 0.4% of the outstanding Class B Shares.

Collectively, the Acquiror, through the MHR Funds, and Dr. Rachesky beneficially own, or exercise control or direction over, an aggregate 18,050,092 Class B Units and 46,136 Class B Shares, representing approximately 35.5% of the issued and outstanding shares in the capital of the Company on a fully exchanged and converted basis.

In addition, Dr. Rachesky owns 42,856 deferred share units which, upon vesting, entitle Dr. Rachesky to an equal number of Class B Shares and/or cash.

Item 4 - Consideration Paid

4.1 State the value, in Canadian dollars, of any consideration paid or received per security and in total.

Not applicable.

Item 5 - Purpose of the Transaction

State the purpose or purposes of the acquiror and any joint actors for the acquisition or disposition of securities of the reporting issuer. Describe any plans or future intentions which the acquiror and any joint actors may have which relate to or would result in any of the following:

(a) the acquisition of additional securities of the reporting issuer, or the disposition of securities of the reporting issuer;

(b) a corporate transaction, such as a merger, reorganization or liquidation, involving the reporting issuer or any of its subsidiaries;

(c) a sale or transfer of a material amount of the assets of the reporting issuer or any of its subsidiaries;

(d) a change in the board of directors or management of the reporting issuer, including any plans or intentions to change the number or term of directors or to fill any existing vacancy on the board;

(e) a material change in the present capitalization or dividend policy of the reporting issuer;

(f) a material change in the reporting issuer's business or corporate structure;

(g) a change in the reporting issuer's charter, bylaws or similar instruments or another action which might impede the acquisition of control of the reporting issuer by any person or company;

(h) a class of securities of the reporting issuer being delisted from, or ceasing to be authorized to be quoted on, a marketplace;

(i) the issuer ceasing to be a reporting issuer in any jurisdiction of Canada;

(j) a solicitation of proxies from securityholders;

(k) an action similar to any of those enumerated above.

All of the Class B Units and Class B Shares reflected in this report were acquired for investment purposes. The Reporting Persons intend to review their holdings in the Company on a continuing basis and as part of this ongoing review, evaluate various alternatives that are or may become available with respect to the Company and its securities. The Reporting Persons may from time to time and at any time (in accordance with any trading policy of the Company or its subsidiaries and affiliates that may then be applicable to the Reporting Persons) in their sole discretion acquire, or cause to be acquired, additional equity or debt securities or other instruments of the Company or its subsidiaries or affiliates, or dispose, or cause to be disposed, such equity or debt securities or instruments, in any amount that the Reporting Persons may determine in their sole discretion, through public or private transactions or otherwise.

The Reporting Persons reserve the right to and may, from time to time and at any time, in their sole discretion, formulate and implement other purposes, plans or proposals regarding the Company or any of its subsidiaries or affiliates or any of their equity or debt securities as the Reporting Persons may deem advisable in their sole discretion. The information set forth in this Item 5 is subject to change from time to time and at any time, and there can be no assurances that any of the Reporting Persons will or will not take, or cause to be taken, any of the actions describe above or any similar actions.

Item 8 - Exemption

If the acquiror relies on an exemption from requirements in securities legislation applicable to formal bids for the transaction, state the exemption being relied on and describe the facts supporting that reliance.

Not applicable.

For further information and to obtain a copy of the early warning report filed by MHR under applicable Canadian securities laws in connection with the acquisitions, please see Telesat's issuer profile on the System for Electronic Document Analysis and Retrieval + at www.sedarplus.ca or please contact Charles Zehren at [phone] or [email protected].

SOURCE MHR Fund Management LLC