Deep Dive with SEC: $UBER, $UBFO, $APRN,

Here are 3 SEC 8-K Filings worth discussing with potential material changes to the company’s forward-looking statements, powered by the Utradea SEC Dashboard. Why are 8-K Filings Important to Investors? Form 8-K is used to update investors and the SEC about a significant event affecting a company. The stock price of the company is often affected by 8-K triggering events, but whether the price goes up or down depends on whether the form contains good or bad news. Naturally, less significant news will have less of a significant impact on stock prices. As an investor, you can make your own decisions about whether the stock price shift is justified after a Form 8-K filing and decide whether to buy, sell or hold the company stock. $UBER: UBER 8-K Filing Uber’s subsidiary Aleka Insurance entered into a Loss Portfolio Transfer with James River Insurance, which allows James River to offload insurance claims to Aleka for Uber automobile insurance going forward. Key Details:  Aleka has to reinsure automobiles (affiliated with Uber) from 2013 - 2019. Aleka will do this as long as James River Insurance Company & James River Casualty Company pay a premium amount of $345.1 million (“Premium”).  Current claims (not affiliated to Uber) transacted by James River (a reference to both companies) will be transferred to 3rd party claims. A quick tip: Use the Smart Parser to identify dates and money values by clicking ‘Smart Parse’ for any given filing under the SEC Dashboard. What is an LPT? “A loss portfolio transfer (LPT) is a reinsurance treaty in which an insurer cedes policies and the loss reserves to pay them to a reinsurer. LPTs allow insurers to remove liabilities from their balance sheets, thus strengthening them, and to transfer risk.” Aleka, which is affiliated with Uber, will be absorbing new liabilities on the balance sheet as part of the reinsurance agreement with James River.  This enables Uber to better manage legacy claims for passengers and drivers affiliated with Uber. Aleka will be performing this work on behalf of Uber. Uber’s insurance teams can work on go-forward insurance costs, make time for better policy and implementations.  What does this mean for Uber and investors? This is a signal of Uber’s mandate to drive down insurance costs, spend less time on legacy claims, and focus more on managing our go-forward insurance costs. This is a better corporate governance decision because it enables Uber to focus on mitigating insurance risk with better policy decisions and future implementations, rather than handling administrative work on legacy claims which add no value to Uber’s business. All in all, a good decision to alleviate a key cost driver for Uber’s business model. $UBFO: United Security Bancshares 8-K Filing The board of directors declared $0.11 per share cash dividend to shareholders. UBFO just released the intent to pay cash dividends. If you’re a registered shareholder as of October 12, 2021, you may have access to this dividend payable on October 25th, 2021. Key Details:  For Recorded shareholders as of October 12, 2021. Payable: October 25, 2021.  Press release attached in the filing Exhibit found in the attached filing. A quick tip: Use the Smart Parser to identify dates and money values by clicking ‘Smart Parse’ for any given filing under the SEC Dashboard. What does this mean for UBFO and investors? They are going to pay a dividend, and as an investor, if you purchase shares by October 12, 2021 you are eligible to receive the dividend. One thing to note, this is usually priced in and the stock will swing leading up to the dividend issuance. $APRN: Blue Apron Holdings Inc 8-K Filing Blue Apron Announces Record Date for Proposed $45 Million Fully-Backstopped Rights Offering, one of many rights offerings planned for Blue Apron to raise an aggregate of $78 million. Key Details of the Current Rights Offering: The company intends to distribute outstanding class A common stock to shareholders. The company intends to distribute warrants for each outstanding class A common stock. The company intends to offer a non-transferable subscription for each share of class A common stock (currently held or purchased) issuable upon exercise of such warrants. Each non-transferable subscription has the 3 following exercise prices: one warrant to purchase the Applicable Fraction of 0.8 of one share at an exercise price of $15.00 per share one warrant to purchase the Applicable Fraction of 0.4 of one share at an exercise price of $18.00 per share one warrant to purchase the Applicable Fraction of 0.2 of one share at an exercise price of $20.00 per share A quick tip: The SEC Dashboard has a Smart Parser to quickly identify dates and money values referenced in the text. Here the parser picked up $78.0 million and the exercise options $15 per share, $18 per share, and $20 per share exercise price for each warrant. What does this mean for APRN and investors? High-Risk High Reward Play with Warrants Upside: Ride seasonal demand for meal kits and tailwind from Q3 with APRN while increasing your position in APRN at a comparatively lower investment cost due to the subscription rights. What APRN is offering is a call warrant, which can be extremely beneficial for existing shareholders to top off on their current equity position in APRN. The non-transferable subscription enables investors to increase their position in APRN at the comparatively lower exercise price if the future expectation of Blue Apron is bullish. Looking at the trajectory, there may be some tailwind coming from APRNs Q3 that will carry over to serve seasonal demand for Thanksgiving. Downside: risk is subject to a few catalyst events. APRN has known operation issues and has problems with customer retention. APRN is being investigated right now  APRN is experiencing corporate governance restructuring APRN has clear logistical issues in their supply chain

Deep Dive with SEC: $UBER, $UBFO, $APRN,

Tai Lin

10:24 AM

Oct 01 2021 (Fri)

Newsletter

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Image credit: Utradea

Here are 3 SEC 8-K Filings worth discussing with potential material changes to the company’s forward-looking statements, powered by the Utradea SEC Dashboard.

Why are 8-K Filings Important to Investors?

Form 8-K is used to update investors and the SEC about a significant event affecting a company. The stock price of the company is often affected by 8-K triggering events, but whether the price goes up or down depends on whether the form contains good or bad news. Naturally, less significant news will have less of a significant impact on stock prices. As an investor, you can make your own decisions about whether the stock price shift is justified after a Form 8-K filing and decide whether to buy, sell or hold the company stock.

$UBER: UBER 8-K Filing

Uber’s subsidiary Aleka Insurance entered into a Loss Portfolio Transfer with James River Insurance, which allows James River to offload insurance claims to Aleka for Uber automobile insurance going forward.

Key Details: 

  1. Aleka has to reinsure automobiles (affiliated with Uber) from 2013 - 2019. Aleka will do this as long as James River Insurance Company & James River Casualty Company pay a premium amount of $345.1 million (“Premium”). 
  2. Current claims (not affiliated to Uber) transacted by James River (a reference to both companies) will be transferred to 3rd party claims.

A quick tip: Use the Smart Parser to identify dates and money values by clicking ‘Smart Parse’ for any given filing under the SEC Dashboard.

What is an LPT?

“A loss portfolio transfer (LPT) is a reinsurance treaty in which an insurer cedes policies and the loss reserves to pay them to a reinsurer. LPTs allow insurers to remove liabilities from their balance sheets, thus strengthening them, and to transfer risk.”

Aleka, which is affiliated with Uber, will be absorbing new liabilities on the balance sheet as part of the reinsurance agreement with James River. 

  1. This enables Uber to better manage legacy claims for passengers and drivers affiliated with Uber. Aleka will be performing this work on behalf of Uber.
  2. Uber’s insurance teams can work on go-forward insurance costs, make time for better policy and implementations. 

 

What does this mean for Uber and investors?
This is a signal of Uber’s mandate to drive down insurance costs, spend less time on legacy claims, and focus more on managing our go-forward insurance costs. This is a better corporate governance decision because it enables Uber to focus on mitigating insurance risk with better policy decisions and future implementations, rather than handling administrative work on legacy claims which add no value to Uber’s business. All in all, a good decision to alleviate a key cost driver for Uber’s business model.

 

$UBFO: United Security Bancshares 8-K Filing

The board of directors declared $0.11 per share cash dividend to shareholders. UBFO just released the intent to pay cash dividends. If you’re a registered shareholder as of October 12, 2021, you may have access to this dividend payable on October 25th, 2021.

Key Details: 

  • For Recorded shareholders as of October 12, 2021.
  • Payable: October 25, 2021
  • Press release attached in the filing
    • Exhibit found in the attached filing.

A quick tip: Use the Smart Parser to identify dates and money values by clicking ‘Smart Parse’ for any given filing under the SEC Dashboard.

What does this mean for UBFO and investors?
They are going to pay a dividend, and as an investor, if you purchase shares by October 12, 2021 you are eligible to receive the dividend. One thing to note, this is usually priced in and the stock will swing leading up to the dividend issuance.

$APRN: Blue Apron Holdings Inc 8-K Filing

Blue Apron Announces Record Date for Proposed $45 Million Fully-Backstopped Rights Offering, one of many rights offerings planned for Blue Apron to raise an aggregate of $78 million.

Key Details of the Current Rights Offering:

  1. The company intends to distribute outstanding class A common stock to shareholders.
  2. The company intends to distribute warrants for each outstanding class A common stock.
  3. The company intends to offer a non-transferable subscription for each share of class A common stock (currently held or purchased) issuable upon exercise of such warrants.
    • Each non-transferable subscription has the 3 following exercise prices:
      • one warrant to purchase the Applicable Fraction of 0.8 of one share at an exercise price of $15.00 per share
      • one warrant to purchase the Applicable Fraction of 0.4 of one share at an exercise price of $18.00 per share
      • one warrant to purchase the Applicable Fraction of 0.2 of one share at an exercise price of $20.00 per share

A quick tip: The SEC Dashboard has a Smart Parser to quickly identify dates and money values referenced in the text. Here the parser picked up $78.0 million and the exercise options $15 per share, $18 per share, and $20 per share exercise price for each warrant.

What does this mean for APRN and investors?

High-Risk High Reward Play with Warrants

Upside: Ride seasonal demand for meal kits and tailwind from Q3 with APRN while increasing your position in APRN at a comparatively lower investment cost due to the subscription rights.

What APRN is offering is a call warrant, which can be extremely beneficial for existing shareholders to top off on their current equity position in APRN. The non-transferable subscription enables investors to increase their position in APRN at the comparatively lower exercise price if the future expectation of Blue Apron is bullish. Looking at the trajectory, there may be some tailwind coming from APRNs Q3 that will carry over to serve seasonal demand for Thanksgiving.

Downside: risk is subject to a few catalyst events. APRN has known operation issues and has problems with customer retention.

  1. APRN is being investigated right now 
  2. APRN is experiencing corporate governance restructuring
  3. APRN has clear logistical issues in their supply chain
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