Upland Software, Inc.UPLD

Upland Software, Inc. Fair Value Disclosure

10-KFiled Mar 3, 20262 min read
3. Fair Value Measurements
Assets measured at fair value on a recurring basis are summarized below (in thousands):
 Fair Value Measurements at December 31, 2025
 Level 1Level 2Level 3Total
Assets:
Cash equivalents - money market funds$18,551 $— $— $18,551 
Interest rate derivatives$— $15 $— $15 
Total$18,551 $15 $— $18,566 
 Fair Value Measurements at December 31, 2024
 Level 1Level 2Level 3Total
Assets:
Cash equivalents - money market funds$40,428 $— $— $40,428 
Interest rate derivatives— 9,742 — 9,742 
Total$40,428 $9,742 $— $50,170 
The Company’s cash equivalents - money market funds are measured at fair value using quoted market prices and active markets, therefore are categorized as Level 1.
The fair value of the Company's interest rate derivatives are measured at the end of each interim reporting period based on the then assessed fair value. As the fair value measure is based on the market approach, they are categorized as Level 2.
The Company’s other financial instruments consist principally of cash and cash equivalents, accounts receivable, accounts payable, and long–term debt. The carrying value of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value, primarily due to short maturities.
The Company believes the carrying value of its long-term debt approximates its fair value based on its variable interest rate feature and interest rates currently available to the Company. The estimated fair value and carrying value of the Company's debt, before debt discount, at December 31, 2025 and December 31, 2024 are $238.5 million and $293.7 million, respectively, based on valuation methodologies using interest rates currently available to the Company which are Level 2 inputs.
The Company’s non-financial assets, such as goodwill and intangible assets, are recorded at fair value upon a business combination and are remeasured at fair value only if an impairment charge is recognized. The Company uses unobservable inputs to the valuation methodologies that are significant to the fair value measurements, and the valuations require management’s judgment due to the absence of quoted market prices. The Company determines the fair value of its held and used assets, goodwill and intangible assets using an income, cost or market approach as determined reasonable. As the fair value measures are based on unobservable inputs, they are categorized as Level 3.
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Historical Timeline

Fiscal YearFiled
2025Mar 3, 2026Showing above
2024Mar 12, 2025
2023Feb 22, 2024
2021Feb 24, 2022
2019Mar 2, 2020
2018Mar 15, 2019
2017Mar 9, 2018
2016Mar 30, 2017
2015Mar 30, 2016

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

Income TaxesRevenueEarnings Per SharePP&EGoodwill & IntangiblesLeasesSegmentsDebtCommitmentsNew StandardsPay vs Performance