Wheels Up Experience Inc.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we are subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. The outcome of these matters cannot be predicted with certainty. See Note 12, Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 “Financial Statements” in this Quarterly Report for a discussion of loss contingencies, if any. Below is a discussion of the Company’s significant pending legal proceedings:

GRP Litigation

On July 5, 2023, we filed a lawsuit against Exclusive Jets, LLC d/b/a flyExclusive, a subsidiary of flyExclusive, Inc. (“FE”), in the United States District Court for the Southern District of New York (“NY Federal Court”), which was re-filed against FE in the Supreme Court of the State of New York in New York County (“NY State Court”) on August 23, 2023. We instituted the action to enforce our rights and remedies for wrongful termination by FE of that certain Fleet Guaranteed Revenue Program Agreement, dated November 1, 2021, between WUP and FE (the “GRP Agreement”). On June 30, 2023, FE notified us in writing of its immediate termination of the GRP Agreement. We believe that FE wrongfully terminated such agreement in breach thereof. We are seeking compensatory damages, including the return of material deposits held by FE under the GRP Agreement (collectively, the “GRP Deposit”) that were recorded in Other non-current assets on the condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024, as well as attorneys’ fees and costs.

Following remand to the NY State Court after removal to the NY Federal Court by FE, on April 9, 2025, FE filed in the NY State Court an answer and its defenses to the Company’s claims, as well as counterclaims for unpaid amounts it claims it is owed under the GRP Agreement. On April 22, 2025, the Company answered FE’s counterclaims and also filed a motion to amend and proposed amended complaint against FE in NY State Court (the “Amended Complaint”), which included, among other things, additional breach of contract claims and added Thomas James Segrave Jr., FE’s founder and Chief Executive Officer, as a defendant for a claim based on piercing the corporate veil. On May 6, 2025, FE filed an opposition to the Company’s motion to amend; however, on July 18, 2025, the NY State Court granted the Company’s motion to amend and the Company filed the Amended Complaint against FE and Mr. Segrave on July 23, 2025. The parties are currently engaged in the discovery process.

We intend to vigorously pursue the action to recover the outstanding deposits and other damages from FE and defend against any related counterclaims, but there can be no assurance as to the outcome of the dispute with FE. Our success in recovering the amounts from FE will depend on several factors, including the availability of funds by FE for the recoverable amounts, in light of the following:

•In its Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on May 1, 2024, FE disclosed that upon termination of the GRP Agreement, it applied a portion of the GRP Deposit against certain receivable balances that FE claims it was owed under the GRP Agreement. As a result, the GRP Deposit liability owed to the Company that was formerly reflected in FE’s financial statements was fully eliminated as of June 30, 2023 and the remainder of the GRP Deposit continues to be withheld from Wheels Up.

•In its Quarterly Report on Form 10-Q for the three months ended March 31, 2025 filed with the SEC on May 13, 2025, FE disclosed: (i) a net loss of $23.0 million for the three months ended March 31, 2025 and that it “expects to incur operating losses in the near term as [FE] advances its fleet modernization and associated cost savings initiatives”; (ii) net cash flows used in operating activities of $10.5 million during the three months ended March 31, 2025; (iii) that as of March 31, 2025, it had cash and cash equivalents of $14.7 million (versus $31.7 million as of December 31, 2024), $8.0 million in short-term investments in securities (versus $65.5 million as of December 31, 2024) and available borrowing capacity of $12.2 million under existing lines of credit, against a working capital deficit of $185.4 million (versus $150.8 million as of December 31, 2024); and (iv) as of May 13, 2025, cash and cash equivalents on hand, operating cash flows and proceeds from its fractional program will be sufficient to fund FE’s operations, including capital expenditure requirements, for at least 12 months, but it might need additional capital to fund growth plans or as circumstances change, which it disclosed it could obtain through equity issuances, refinancing existing debt or new borrowings, and if FE is not able to raise capital, its business, prospects, operating results and financial condition could be negatively impacted.

We are in the process of evaluating the effects of the foregoing events and we cannot make a reasonable estimate of any outcome, recovery or loss at this time. See the caption titled “Some of our business is dependent on our third-party operators to provide flights for our members and customers. If such third-party operators do not perform adequately or terminate their relationships with us, our costs may increase and our business, operations, liquidity, financial condition, and results of operations could be adversely affected” in Part I, Item 1A “Risk Factors” in our Annual Report for further information.