Form 4: Uber Sells $1.15 Billion in Exchangeable Senior Notes Due 2028

Uber Technologies sold $1.15 billion in exchangeable senior notes due 2028 in a private placement, with the notes exchangeable into cash, Aurora Innovation Class A common stock, or a combination thereof.

Summary

• Uber Technologies, Inc. sold $1,150,000,000 aggregate principal amount of its 0.0% exchangeable senior notes due 2028 (the 'Notes') to an investment bank acting as initial purchaser in a private placement pursuant to Rule 144A.
• The notes were issued on May 20, 2025, pursuant to an indenture among Uber, its indirect wholly-owned subsidiary Neben Holdings, LLC, and a trustee.
• The notes are exchangeable into cash, shares of Class A common stock of Aurora Innovation, Inc., or a combination thereof, at Uber's election.
• The initial exchange rate is 117.6471 shares of Aurora Innovation Class A common stock per $1,000 principal amount of notes, equivalent to an initial exchange price of approximately $8.50 per share.
• The notes are immediately exchangeable, subject to the terms and conditions described in the indenture.
• Holders may require Uber to repurchase the notes for cash under certain circumstances, such as an 'Uber fundamental change', an 'Aurora fundamental change', or a 'share ownership event'.

Sentiment

Score: 7

Explanation: The sentiment is neutral to positive. The transaction provides Uber with additional capital and flexibility, but also carries potential risks related to dilution and repurchase obligations.

Positives

• Uber secures $1.15 billion in financing through the issuance of exchangeable senior notes.
• The exchange feature provides Uber with flexibility in managing its investment in Aurora Innovation.
• The private placement allows Uber to access capital markets efficiently.

Negatives

• The exchange feature could potentially dilute existing Aurora Innovation shareholders if Uber elects to exchange the notes for shares.
• The repurchase provision could require Uber to use cash to repurchase the notes under certain circumstances.

Risks

• The exchange rate is subject to adjustment, which could impact the value of the notes.
• The occurrence of a fundamental change event could trigger a repurchase obligation for Uber.
• Market conditions and the performance of Aurora Innovation's stock could affect the value of the notes and Uber's ability to exchange them favorably.

Future Outlook

The notes are immediately exchangeable subject to the terms and conditions described in the Indenture. The exchange rate will be subject to adjustment in some events. In addition, following certain corporate events that occur prior to the maturity date or if the Reporting Person delivers a notice of redemption, the Reporting Person will, in certain circumstances, increase the exchange rate for a holder who elects to exchange its notes in connection with such a corporate event or exchange its Notes called (or deemed called) for redemption during the related redemption period, as the case may be.

Industry Context

The issuance of exchangeable notes is a common financing strategy for companies seeking to raise capital while retaining flexibility in managing their equity investments. This transaction allows Uber to monetize a portion of its investment in Aurora Innovation while potentially benefiting from future appreciation in Aurora's stock price.

Comparison to Industry Standards

• Exchangeable notes are frequently used by companies holding significant stakes in other publicly traded entities.
• Comparable transactions include the issuance of exchangeable notes by companies like Tesla to monetize their holdings in SolarCity prior to its acquisition.
• The terms of the notes, including the exchange rate and maturity date, are generally consistent with market standards for similar instruments.

Stakeholder Impact

• Shareholders of Uber may experience a slight dilution if Uber elects to exchange the notes for Aurora Innovation shares.
• Shareholders of Aurora Innovation may experience dilution if Uber elects to exchange the notes for Aurora Innovation shares.
• Noteholders will receive interest payments and have the option to exchange their notes for cash or Aurora Innovation shares.

Next Steps

• Uber will continue to monitor the performance of Aurora Innovation's stock and market conditions to determine the optimal timing for exchanging the notes.
• Holders of the notes will have the option to exchange their notes for cash, Aurora Innovation shares, or a combination thereof, subject to the terms of the indenture.

Key Dates

Keywords

exchangeable senior notes, Aurora Innovation, Uber, private placement, financing, debt, notes, investment