Upland Software, Inc.UPLD
Upland Software, Inc. Debt Disclosure
6. Debt
Long-term debt consisted of the following at December 31, 2025 and December 31, 2024 (in thousands):
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
Senior secured loans (includes unamortized discount of $6,094 and $3,456 based on an imputed interest rate of 10.4% and 6.6%, at December 31, 2025 and December 31, 2024, respectively) | $ | 232,406 | $ | 290,194 | |||||||
| Less current maturities (including Excess Cash Flow payment) | (7,739) | (3,224) | |||||||||
| Total long-term debt | $ | 224,667 | $ | 286,970 | |||||||
On July 25, 2025, (the “Closing Date”), the Company entered into a Credit Agreement (the “Credit Agreement”) which provided for (i) a senior secured term loan facility in the aggregate principal amount of $240 million (the “Term Loan”) and (ii) a senior secured revolving credit facility in the aggregate principal amount of $30 million (the “Revolving Facility” and together with the Term Loan, the “Credit Facilities”).
On the Closing Date the proceeds of the Term Loan, together with cash on hand, were used to redeem all of the then current outstanding aggregate principal amount of the Company’s previous senior secured credit facility. The Term Loan matures on July 25, 2031 and bears an interest rate of the secured overnight financing rate, which shall not be less than 1.5%, plus a margin of 6.0% per annum (with step downs and a potential step up at specified leverage levels). At December 31, 2025, the floating interest rate was 9.7%.
Payments on the Term Loan are due quarterly in amounts equal to (a) 2.5% per annum of the original principal amount of the Term Loan commencing beginning December 31, 2025 through September 30, 2026, (b) 1.8% per annum of the original principal amount of the Term Loan commencing December 31, 2026 through September 30, 2027, and (c) 1.0% per annum of the original principal amount of the Term Loan commencing December 31, 2027 and continuing each fiscal quarter thereafter, with the balance payable on the maturity date. Quarterly Excess Cash Flow payments may be due approximately 90 days after each quarter end based on net leverage ratios as defined in the Credit Agreement. At December 31, 2025, the Excess Cash Flow payment due under the terms of the Credit Agreement was $3.3 million and is included in current maturities of long-term debt in the consolidated balance sheets.
The Revolving Facility matures on July 25, 2031 and bears the same interest rate as the Term Loan. The proceeds of loans under the Revolving Facility can be used by the Company for working capital and other general corporate purposes. No amounts were outstanding under the Revolving Facility as of December 31, 2025.
The Credit Facilities contains customary representations, warranties, covenants, including financial covenant, and events of default. The Credit Facilities are secured by substantially all of the Company’s assets, subject to certain exclusions. The Term Loan also includes (i) a covenant tested quarterly which limits the consolidated secured leverage ratio to 6.0 to 1.0 or under and (ii) certain other changes to the terms of the Credit Agreement, including with respect to certain negative covenants. The Revolving Facility is subject to the same covenants and terms as the Term Loan. As of December 31, 2025, the Company was in compliance with all covenants under the Credit Facilities.
The Company’s previous senior secured credit agreement provided for (i) 7 year, senior secured term loans which were repaid July 25, 2025 with the proceeds of the Term Loan and (ii) a $60 million, 5 year, revolving credit facility which matured August 6, 2024.
In conjunction with the repayment of the previous credit agreement, the Company incurred a loss on early extinguishment of debt of $2.3 million related to the write-off of unamortized debt discount and deferred financing fees, which was recorded as a loss on debt extinguishment in the consolidated statements of operations for the year ended December 31, 2025. The Company incurred $7.1 million of lender fees (debt discount) and third party financing costs associated with the Credit Agreement entered into in July 2025. The lender fees and third party costs associated with the Term Loan are recorded as a direct deduction from the long-term debt and the lender fees and third party costs associated with the Revolving Facility are recorded in Other assets in the consolidated balance sheets. All lender fees and third party costs are amortized into interest expense, net over the contractual term of the Credit Agreement.
Interest rate derivatives
In 2019 the Company entered into floating-to-fixed interest rate swap agreements to limit exposure to interest rate risk related to its debt, effectively converting a portion of the balance of the Company's debt from variable interest payments to fixed interest rate payments, based on an annualized fixed rate of 5.4%, through the maturity of the previous senior secured term loans, August 6, 2026. At the time the Company entered into the interest rate swap agreements, the Company designated all of the swaps as cash flow hedges. In August 2024, the Company de-designated all of the interest rate swaps and the realized and unrealized gains previously recognized as a component of accumulated other comprehensive loss are being amortized to interest expense, net as interest is accrued or prepayments are made on the Company’s debt. Subsequent to the de-designation, changes in the fair value of the interest rate swaps were recorded to interest expense, net. On July 18, 2025, the Company sold all of its remaining floating-to-fixed interest rate swap agreements.
Effective September 30, 2025, the Company entered into an interest rate cap agreement to limit exposure to interest rate risk, effectively capping the secured overnight financing rate at 4.5% related to $120.0 million of its outstanding debt. The interest rate cap is reported at fair value and is included in other assets on the consolidated balance sheets, and the change in the fair value of the interest rate cap is reported in interest expense, net on the consolidated statements of operations.
Amounts previously reported in accumulated other comprehensive loss related to the Company's interest rate swaps are reclassified to interest expense, net as interest is accrued on the Company’s variable-rate debt or prepayments are made. The impact of the Company’s derivative financial instruments on its consolidated statements of comprehensive loss was as follows (in thousands):
| Year Ended December 31 | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Unrealized gain (loss) recognized in other comprehensive loss on interest rate swaps | $ | — | $ | (2,918) | $ | (6,434) | ||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss to interest expense, net | (7,969) | (15,868) | (5,289) | |||||||||||||||||
| Total other comprehensive income (loss) on interest rate derivatives, net of reclassifications into earnings | $ | (7,969) | $ | (18,786) | $ | (11,723) | ||||||||||||||
The impact of the Company’s interest rate derivatives on its consolidated statements of operations was as follows (in thousands):
| Year Ended December 31 | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Unrealized loss in fair value of interest rate derivatives | $ | (3,237) | $ | (1,611) | $ | — | ||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss to interest expense, net | 7,969 | 15,868 | 5,289 | |||||||||||||||||
| Cash payments | 3,163 | 9,423 | 13,942 | |||||||||||||||||
| Total income (expense) related to interest rate derivatives in interest expense, net | $ | 7,895 | $ | 23,680 | $ | 19,231 | ||||||||||||||
In the next twelve months assuming no additional prepayments, the Company estimates that $2.7 million will be reclassified from accumulated other comprehensive loss to interest expense, net on the consolidated statements of operations.
Cash interest costs averaged 7.9%, 6.6%, and 7.2% for the years ended December 31, 2025, 2024, and 2023, respectively.
Debt Maturities
Under the terms of the Credit Facilities, future debt maturities of long-term debt excluding debt discounts at December 31, 2025 are as follows (in thousands):
| Year ending December 31: | Amount | |||||||
| 2026 | $ | 8,872 | ||||||
| 2027 | 3,750 | |||||||
| 2028 | 2,400 | |||||||
| 2029 | 2,400 | |||||||
| 2030 | 2,400 | |||||||
| Thereafter | 218,678 | |||||||
| Total debt outstanding | $ | 238,500 | ||||||
| Less unamortized discount | 6,094 | |||||||
| Total debt outstanding, net of discount | $ | 232,406 | ||||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 3, 2026 | Showing above |
| 2024 | Mar 12, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2021 | Feb 24, 2022 | |
| 2019 | Mar 2, 2020 | |
| 2018 | Mar 15, 2019 | |
| 2017 | Mar 9, 2018 | |
| 2016 | Mar 30, 2017 | |
| 2015 | Mar 30, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.