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`SECFilings: Forms You Need To Know
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`SEC Filings: Forms You Need To Know
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`The Securities and Exchange Commission (SEC) requires public companies, certain
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`companyinsiders, and broker-dealersto file periodic financial statements and other
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`disclosures. Finance professionals and investors rely on SEC filings to make informed
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`decisions when evaluating whetherto invest in a company. SECfilings can be accessed for
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`free at EDGAR,the commission's online database.
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`The SEC wascreated through the Securities Exchange Act of 1934, which wassignedinto
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`law by President Franklin D. Roosevelt.’ The act was intendedto help restore investor
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`governmentagency tasked with protecting investors, maintaining a fair and orderly market,
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`The SECselectively reviews the information it receives to monitor and enhance
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`compliance. * Investors study thesefilings to form a view of a company's performance and
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`activities. Here are some of the most commonforms that companies are required to submit
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`to the SEC. Understanding how to read SECfilings can be beneficial to investors as they
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`perform their due diligence. In this article, we'll discuss thesefilings in greater detail.
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`KEY TAKEAWAYS
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`e SECfilings are important regulatory documents required ofall public companies to
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`Apotex Exhibit 1050
`Page 3 of 10
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`1/20/2021
`SEC Filings: Forms You Need To Know
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`Chairman or CEO, and a summary overviewof the financials. The 10-K is a longer, more
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`thorough technical documentthatwill have all of the company's financial statements
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`available for fundamental analysis. Fundamental analysis is a common wayto evaluate a
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`firm by constructing ratios and other metrics by extracting information from the balance
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`sheet, income statement, and statement of cash flows. For stocks, fundamental analysis
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`looks to revenues, earnings, future growth, return on equity (ROE), profit margins, and equity
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`multiples to determine a company's underlying value and potential for future growth. For
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`In addition to the quantitative approach to fundamental analysis, readers of a 10-K should
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`also payattention to its "Item 1", which explains what the company does, whoits customers
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`are, and the primary industry in whichit operates. ® Then, lookfor risk factors such aslegal
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`proceedings or statements indicating future chargesorvolatility.
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`Also, pay attention to any footnotes that are included in the report. These noteswill tell you
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`accounting method andindustry standards. This information can flag potentially shady
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`accounting practices. Other details mentioned in the footnotes include errors in previous
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`accounting statements, looming legal cases in which the companyis involved, and details of
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`Asan investor, pay special attention to any footnotes in Form 10-K, as they can
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`help you flag any questionable accounting practices in the company you are
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`Form 10-Q
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`Form 10-Q is a truncated version of Form 10-K thatis filed quarterly. The form provides a
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`view of the company's ongoing financial condition throughout the year. The Form 10-Q must
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`be filed for the first three quarters of the company's fiscal year. The deadlinetofile is within
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`40 daysfrom the end of the quarter. Unlike Form 10-K, the financial statements in Form 10-Q
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`are unaudited, and the information required is less detailed. °
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`Why Form 10-Q Is Important to Investors
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`The 10-Q is important sinceit is updated quarterly, while the more comprehensive 10-Kis
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`ratios without as muchof a lag. Investors can use the 10-Q to observe any changesthat may
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`be taking place within the corporation even beforeit files its annual report.
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`Some areasof interest to investors that are commonlyvisible in the 10-Q include changesto
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`working capital and/or accounts receivables, factors affecting a company's inventory, share
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`buybacks, and evenanylegal risks that a company faces. You can use a close competitor's
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`10-Q as a comparison companyto put side-by-side the company you are considering to see
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`https://www.investopedia.com/articles/fundamental-analysis/08/sec-forms.asp
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`Apotex Exhibit 1050
`Apotex Exhibit 1050
`Page 4 of 10
`Page 4 of 10
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`1/20/2021
`SEC Filings: Forms You Need To Know
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`how it's performing on a relative basis. This will give you a broader idea of whether your
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`investment is a strong choice, where its weaknessesare, and howit could stand to improve.
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`Form 8-K
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`The Form 8-K is what a companyusesto disclose major developments that occur between
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`filings of the Form 10-K or Form 10-Q. Major company events that would necessitate the
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`filing of a Form 8-K include bankruptcies or receiverships, material impairments, completion
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`of acquisition or disposition of assets, or departures or appointments of executives. '°
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`Why Form 8-K Is Important to Investors
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`Form 8-K providesinvestors with timely notification of significant changes at a company.
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`Many of these changesare defined explicitly by the SEC (such as a merger or acquisition),
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`while others are simply events that firms consider to be sufficiently noteworthyforits
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`shareholders (such as a new productrelease or upgrade). Either way, the 8-K provides a
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`Form 8-K also provides a valuable record for financial research and analysis. For example,
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`an analyst may wonder whatinfluence certain corporate events have on stockprices. It is
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`possible to estimate the impact of these events using statistical techniqueslike regressions,
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`Proxy Statement
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`In the proxy statement, investors can view the salaries of the management of a company and
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`presented prior to the shareholder meeting and must befiled with the SEC beforesoliciting a
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`shareholdervote on the election of directors and approvalof other corporate actions. ®
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`Whya Proxy Statementis Important to Investors
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`Public companies hold annual meetings where shareholders convene to vote on various
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`corporate actions or for new membersto the board of directors. Owning commonstockin a
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`companygives you a vote (usually one vote per share), butit is not typically feasible to
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`attend the annual meeting. The proxy statementallows you to cast your votes using a
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`designated person, who will aggregate votes and cast them on your behalf. This person is
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`knownas a proxy and will cast a proxy vote in line with the shareholder's directions as
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`written on their proxy card. Proxy votes maybe cast by mail, phone, or online before the
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`cutoff time. This deadline is usually 24 hours before the shareholder meeting commences.
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`Vote responseswill typically include "For," "Against," "Abstain," or "Not Voted."
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`The proxy statementwill therefore present the items that will be voted on and allow you to
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`return a form to the companyto inform your proxy how your votes should becast.
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`https://www.investopedia.com/articles/fundamental-analysis/08/sec-forms.asp
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`Apotex Exhibit 1050
`Apotex Exhibit 1050
`Page 5 of 10
`Page 5 of 10
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`
`
`SECFilings: Forms You Need To Know
`ÿ
`
`
`1/20/2021
`
`Forms 3, 4, and 5
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`Corporate insiders mustfile Forms 3, 4, and 5. The SEC defines a corporate insider as "a
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`company's officers and directors, and any beneficial owners of more than ten percent of a
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`ExchangeAct of 1934." These forms are meant to reveal more information about the
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`Why Forms 3, 4, and 5 Are Important to Investors
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`If you're an investor, it pays to know what the company's owners and mostimportant
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`shareholders(i.e., insiders) are doing. By watching the trading activity of
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`corporateinsiders and large institutional investors, it's easier to get a sense of a stock's
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`By paying close attention to whatinsiders do with their company shares, savvy investors can
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`the rest of us outsiders. So, if insiders are buying sharesin their own companies, they might
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`Oneof the greatest investors ofall time, Peter Lynch, oncesaid, "insiders mightsell their
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`Schedule 13D
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`within 10 days of reaching the 5% threshold. It provides the following information:
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`Apotex Exhibit 1050
`Apotex Exhibit 1050
`Page 6 of 10
`Page 6 of 10
`
`
`
`1/20/2021
`SEC Filings: Forms You Need To Know
`
`ÿ
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`The acquirer's name, address, and other background information
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`Type of relationship this owner has with the company
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`Whether the person has been convicted of a crime in the pastfive years
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`Why Schedule 13D is Important to Investors
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`Section 13D was added to the Securities Exchange Act of 1934 as part of a 1968
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`of tender offers as part of corporate takeovers. Schedule 13D was designedto give
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`Investors use Schedule 13D to both detect red flags in the consolidation of insider ownership
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`Form 144
`ÿ 22
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`Form 144 is required when corporate insiders want to dispose of company stock. Form 144
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`is a notice of the intent to sell restricted stock, typically acquired by insiders or affiliates in a
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`transaction not involving a public offering. The stock is restricted because it must meet
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`made within 90 daysoffiling. Form 144 is required when the amountsold during any three-
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`ÿ ÿ- ÿ4( ÿ ÿÿ54 ( .ÿ
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`Why Form 144 Is Important to Investors
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`While investors can look to Forms 3, 4, and 5 for changesin insider ownership, Form 144 is
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`muchastockprice might suffer if a flood of new sale orders enter the market when the lock-
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`Underwriters and regulators require that a company's executives, managers, employees,
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