Form 4: RumbleOn Insider Transactions: Cohen, SH Capital, and Stone House Capital Increase Stake Through Rights Offering

Mark Cohen, SH Capital Partners, and Stone House Capital Management have increased their holdings in RumbleOn through a rights offering and backstop agreement.

Summary

• Mark Cohen, along with SH Capital Partners and Stone House Capital Management, have reported changes in their beneficial ownership of RumbleOn, Inc. stock.
• SH Capital Partners acquired 317,343 shares of Class B Common Stock at $4.18 per share through a rights offering.
• These shares are expected to be formally issued around December 17, 2024.
• Stone House Capital Management agreed to purchase any remaining unsubscribed shares from the rights offering through a backstop private placement.
• Mark Cohen also holds 28,531 unvested restricted stock units (RSUs) awarded on August 9, 2024.
• The rights offering provided one subscription right for each share of Class B Common Stock owned as of November 25, 2024, with each right exercisable for 0.0677 shares.
• The total number of shares beneficially owned by the group after these transactions is 6,726,482 indirectly and 28,531 directly.

Sentiment

Score: 7

Explanation: The document indicates increased insider ownership, which is generally a positive sign. However, the backstop agreement suggests potential challenges in raising capital from other sources, which tempers the overall positive sentiment.

Positives

• The rights offering and backstop agreement demonstrate confidence in RumbleOn by key insiders.
• The acquisition of shares by SH Capital Partners and the backstop commitment by Stone House Capital Management provide additional capital to the company.
• The participation of insiders in the rights offering suggests a positive outlook on the company's future.

Negatives

• The document indicates that the results of the rights offering are preliminary and subject to change.
• The backstop agreement suggests that there may have been a lack of full subscription by other shareholders.

Risks

• The finalization of the rights offering is still pending, and the number of shares issued may change.
• The backstop agreement could indicate potential challenges in raising capital from other sources.
• The unvested RSUs held by Mark Cohen could potentially dilute the stock if they vest.

Future Outlook

The shares acquired through the rights offering are expected to be formally issued around December 17, 2024. The final results of the rights offering are still pending.

Management Comments

• Each reporting person disclaims beneficial ownership of the securities covered by this statement, except to the extent of the pecuniary interest of such person in such securities.
• Each reporting person may be deemed to be a member of a group with respect to the issuer or securities of the issuer.

Industry Context

This type of insider transaction is common in the financial markets, especially when companies are raising capital. Rights offerings are a way for existing shareholders to maintain their ownership percentage and can be a sign of confidence in the company's future.

Comparison to Industry Standards

• Rights offerings are a common method for companies to raise capital, particularly when they need to strengthen their balance sheet or fund growth initiatives.
• The backstop agreement with Stone House Capital Management is a typical measure to ensure the success of a rights offering, similar to other companies that use this mechanism to guarantee full subscription.
• The price of $4.18 per share is a key metric, and its impact on the stock price will be closely watched by investors, similar to how other companies' stock prices react to similar transactions.

Stakeholder Impact

• Shareholders who participated in the rights offering will see their ownership stake maintained or increased.
• The backstop agreement provides additional capital to the company, which could benefit all stakeholders.
• The increased insider ownership may boost investor confidence.

Next Steps

• The shares acquired through the rights offering are expected to be formally issued around December 17, 2024.
• The final results of the rights offering will be determined after the subscription procedures are finalized.

Key Dates

Keywords

RumbleOn, Rights Offering, Insider Transactions, Class B Common Stock, SH Capital Partners, Stone House Capital Management, Mark Cohen, Subscription Rights, Backstop Agreement, Beneficial Ownership