Company: UP
Filing Date: 2025-03-11
Form Type: 10-K
Source: 0001819516-25-000012
Chunk: 219

Company: Wheels Up Experience Inc.
Filing Date: 2025-03-11
Form: 10-K
Item: Item 8
Chunk 219
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 Officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected or preventable.

ITEM 9B. OTHER INFORMATION

(a)    As part of the Company’s continuing cost reduction initiatives, in the first quarter of 2025, the Company leased alternative corporate office space in New York, New York and vacated a larger leased corporate office space in New York, New York, for which the Company is actively seeking a sublease tenant. Due to a general reduction in demand for corporate office space in the locale, the Company anticipates reduced sublease rent rate for the vacated space and that the terms of any sublease may differ from the underlying lease to which the Company is a party. As a result, the Company concluded on March 9, 2025 that it expects to record a non-cash, pre-tax impairment charge related to a right of use asset associated with the vacated corporate office space ranging from approximately $20.0 million to $24.0 million in the first quarter of 2025, virtually all of which will result in future cash expenditures. Following these actions, the Company expects a significant decrease in future operating expenses related to leased corporate office space. Following these actions, the Company expects