UC Asset announces plan of management stock buyback

Rhea-AI Summary

UC Asset LP (OTCQB: UCASU) has announced a management stock buyback plan, as disclosed in their recent Form 1-U filing with the SEC. The company's general partner members intend to purchase shares on the open market throughout the remainder of 2024 and potentially into 2025. Concurrently, UC Asset has cancelled its previously announced company stock repurchase program due to regulatory constraints and bylaw limitations.

Founder Larry Wu explained that company buybacks are subject to strict regulations, including price and volume limitations, which made it impractical for UC Asset given its low trading volume. Additionally, the company couldn't secure majority shareholder approval for necessary bylaw amendments. The management buyback, however, is not subject to the same restrictions and will be conducted at the discretion of the purchasing general partner members.

Positive

• Management's willingness to invest personal funds in company stock shows confidence in UC Asset's future
• Management buyback may potentially increase stock demand and support share price

Negative

• Cancellation of company stock repurchase program may disappoint some investors
• Low trading volume of UCASU stock indicates market liquidity
• Inability to secure shareholder approval for bylaw amendments suggests potential governance challenges

ATLANTA, Sept. 3, 2024 /PRNewswire/ -- UC Asset LP (OTCQB: UCASU) announces today that the company's management team intends to buy back its shares on the open market. The plan is included in its Form 1-U filed to SEC last Friday.

According to its Form 1-U, some members of UC Asset's general partner will purchase shares of the company on the open market in the rest of the year 2024, and may continue doing so in the year 2025.

In the same Form 1-U, it is also announced that the company has cancelled its stock repurchase program, which was first announced in January 2024.

"Company buyback is subject to certain laws and regulations such as Rule 10b-18 ("Safe Harbor" for Issuer Repurchases) of the Security Act. It limits the price of buyback to not higher than the highest independent bid or the last independent transaction price. Also, it limits the total volume of buyback on any single day to no more than 25% of the average daily trading volume," explains Larry Wu, founder of UC Asset. "Since the average daily trading volume of our shares is close to zero in the past months, it is practically impossible for the company to effect any stock buybacks following this specific rule."

"Besides, there are certain articles in our bylaw that can be interpreted as prohibiting stock buyback, so an effective buyback program requires material amendments to our bylaw," says Wu. "After months of discussion with shareholders who collectively hold a majority of voting rights in our company, we have concluded that we cannot secure majority vote to make these amendments. For the reasons above, the company has decided to cancel its share repurchase program."

Meanwhile, Wu asserts that he believes a management buyback will not be subject to the same regulations, and will not be prohibited by the company's bylaw.

The amount, price and time of such management buyback will be at the sole discretion of the purchasing general partner member. All purchases will be disclosed on Form 4 in a timely manner.

About UC Asset LP

UC Asset LP is a limited partnership formed for the purpose of investing in real estate with innovative strategies.  For more information about UC Asset, please visit: www.ucasset.com

Disclaimer:

This News Release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any these statements. You are cautioned not to place undue reliance on any those forward-looking statements. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this news release. None of such forward-looking statements should be regarded as a representation by us or any other person that the objectives and plans set forth in this News Release will be achieved or be executed.

For More Information Contact: IR@UCasset.com, +1 470-475-1035

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SOURCE UC Asset LP

FAQ

What is UC Asset's new stock buyback plan for 2024?

UC Asset's management team plans to buy back company shares on the open market throughout the remainder of 2024, with the possibility of continuing into 2025. This management buyback replaces the previously announced company stock repurchase program.

Why did UC Asset cancel its company stock repurchase program?

UC Asset cancelled its company stock repurchase program due to regulatory constraints, particularly Rule 10b-18 limitations on price and volume, which made buybacks impractical given the company's low trading volume. Additionally, the company couldn't secure majority shareholder approval for necessary bylaw amendments.

How will UC Asset's management buyback be different from the cancelled company program?

The management buyback will not be subject to the same regulatory restrictions as the company program. The amount, price, and timing of purchases will be at the sole discretion of the purchasing general partner members, and all purchases will be disclosed on Form 4 in a timely manner.

What is the trading symbol for UC Asset stock?

UC Asset's stock trades under the symbol UCASU on the OTCQB market.