Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): September 22, 2024

WHEELS UP EXPERIENCE INC.

(Exact name of registrant as specified in its charter)

Delaware	001-39541	98-1617611
(State or other jurisdiction	(Commission	(I.R.S. Employer
of incorporation)	File Number)	Identification No.)

2135 American Way
Chamblee, Georgia	30341
(Address of principal executive offices)	(Zip Code)

(212) 257-5252

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange

on which registered

Class A common stock, $0.0001 par value per share

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 1.01

Entry into a Material Definitive Agreement.

On September 22, 2024, Wheels Up Experience Inc. (the “Company”) entered into Amendment No. 2 to Investment and Investor Rights Agreement (the “Investor Rights Agreement Amendment”), with each of Delta Air Lines, Inc. (“Delta”), CK Wheels LLC (“CK Wheels”), Cox Investment Holdings, LLC (“CIH” and, collectively with Delta and CK Wheels, the “Lead Investors”), Whitebox Multi-Strategy Partners, LP (“Whitebox MSP”), Whitebox Relative Value Partners, LP (“Whitebox RVP”), Pandora Select Partners, LP (“Pandora”), Whitebox GT Fund, LP (“Whitebox GT” and, collectively with Whitebox MSP, Whitebox RVP and Pandora, the “Whitebox Entities”) and Kore Air LLC (“Kore” and, collectively with the Whitebox Entities, the “Additional Investors” and, collectively with the Lead Investors, the “Investors”), to amend and extend, among others, certain transfer restrictions set forth in the Investment and Investor Rights Agreement, dated September 20, 2023, by and among, the Company and the Investors (as amended by Amendment No. 1 thereto, dated as of November 15, 2023, the “Investor Rights Agreement”). Pursuant to the Investor Rights Agreement Amendment, the Lead Investors agreed to extend the lock-up restriction with respect to all of their shares of the Company’s Class A common stock, $0.0001 par value per share (“Common Stock”), issued pursuant to the Investor Rights Agreement (“Shares”) for an additional year, until September 20, 2025, and the Additional Investors agreed to extend the lock-up restriction with respect to 72.5% of their Shares for an additional year, until September 20, 2025, in each case subject to limited exceptions for transfers to Permitted Transferees (as defined in the Investor Rights Agreement); provided, that any transfers or sales of Shares held by the Additional Investors that are not subject to the extended lock-up restriction shall not be at a price less than the minimum price per share specified in the Investor Rights Agreement Amendment. Pursuant to the Investor Rights Agreement Amendment, approximately 97.2% of the Shares will remain subject to a lock-up restriction until September 20, 2025.

In addition, on September 22, 2024, the holders that collectively beneficially own in excess of 66.67% of the Registrable Securities (as defined in the Registration Rights Agreement, dated as of September 20, 2023, by and among the Company and the equity holders set forth on Schedule 1 thereto) extended the deadline by which the Company must file an initial shelf registration statement to register the Shares under the Securities Act of 1933, as amended (the “Securities Act”), to September 20, 2025.

At the time the Investor Rights Agreement Amendment was entered into: (i) Delta beneficially owned approximately 37.8% of the outstanding shares of Common Stock, of which any shares in excess of 29.9% of shares of Common Stock entitled to vote at any annual meeting of the Company's stockholders that are held by Delta will be neutral shares with respect to voting rights; (ii) CK Wheels beneficially owned approximately 37.0% of the outstanding shares of Common Stock; (iii) CIH beneficially owned approximately 12.1% of the outstanding shares of Common Stock; and (iv)(a) each Investor was a lender under the Company’s secured credit facility, and was a party to certain other agreements concerning the governance of the Company and commercial arrangements, in each case as disclosed under the heading “Related Person Transactions with Holders of More than 5% of Our Voting Stock” in the Company’s definitive proxy statement on Schedule 14A, which was filed with the U.S. Securities and Exchange Commission (“SEC”) on April 24, 2024, and (b) Delta and the Company were parties to certain transactions described in Item 1.01 of the Company’s Current Report on Form 8-K filed with the SEC on June 17, 2024. The Investor Rights Agreement Amendment was approved by the disinterested, independent members of the Company’s Board of Directors (the “Board”) and Audit Committee of the Board.

The foregoing description of the Investor Rights Agreement Amendment does not purport to be complete and is qualified in its entirety by reference to a copy thereof, which is attached hereto as Exhibit 10.1 and incorporated by reference herein.

Item 7.01

Regulation FD Disclosure.

On September 23, 2024, the Company issued a press release regarding the lock-up extension described in Item 1.01 of this Current Report on Form 8-K (this “Current Report”), a copy of which is furnished as Exhibit 99.1 and incorporated by reference herein.

The information in Item 7.01 of this Current Report and Exhibit 99.1 is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing made by the Company under the Securities Act or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number		Description
10.1*		Amendment No. 2 to Investment and Investor Rights Agreement, dated September 22, 2024, by and among Wheels Up Experience Inc. and the Investors listed on the signature pages thereto

99.1**		Press Release, dated September 23, 2024

104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	*	Filed herewith.
	**	Furnished herewith.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WHEELS UP EXPERIENCE INC.


Date: September 23, 2024	By:	/s/ George Mattson
		Name:	George Mattson
		Title:	Chief Executive Officer

Exhibit 10.1

AMENDMENT NO. 2 TO INVESTMENT AND INVESTOR RIGHTS AGREEMENT

This Amendment No. 2 (“Amendment No. 2”), dated as of September 22, 2024, to the Investment and Investor Rights Agreement, dated as of September 20, 2023 (the “Original Investment Agreement”, as amended by Amendment No. 1 thereto, dated as of November 15, 2023 (“Amendment No. 1”), and as supplemented by the several Joinders thereto, dated November 15, 2023 (collectively, the “Investment Agreement Joinders”), collectively the “Investment Agreement”), by and among Wheels Up Experience Inc., a Delaware corporation (the “Company”), and the entities listed on Schedule A to the Investment Agreement (each, an “Investor” and collectively, the “Investors”), is made and entered into by and between the Company and the Investors listed on the signature pages hereto. Capitalized terms used herein without definition have the meanings assigned to them in the Investment Agreement.

W I T N E S S E T H:

WHEREAS, Section 8.03(b) of the Investment Agreement permits the amendment of the Investment Agreement provided such amendment is in writing and signed by each of the Parties to the Investment Agreement affected by such amendment; and

WHEREAS, the Investors and the Company desire to amend the Investment Agreement as set forth in this Amendment No. 2.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.             The Investment Agreement is hereby amended by deleting Section 6.06(a) in its entirety and replacing with the following:

(a)

(i)

(A) For the period beginning on the date of issuance of Shares under this Agreement until September 20, 2024 (the “Initial Restricted Period”), no Investor shall Transfer or permit the Transfer of any or all of its or its Affiliates’ Shares, except to one or more of its Permitted Transferees; and (B) during the period beginning immediately upon the end of the Initial Restricted Period until September 20, 2025 (the “Extended Restricted Period” and, together with the Initial Restricted Period, the “Restricted Period”), (y) each Additional Investor shall not Transfer or permit the Transfer of 72.5% of the number of Shares originally issued to the Additional Investor or its Affiliates, except to one or more of its Permitted Transferees, and (z) none of Delta, CK Opps I or Cox (collectively, the “Initial Investors”) shall Transfer or permit the Transfer of any or all of their Shares or respective Affiliates’ Shares, except to one or more of their respective Permitted Transferees. Upon the expiration of the Extended Restricted Period, all Shares held by the Investors shall cease to be subject to the restrictions set forth in this Section 6.06(a); provided, however, that such Shares shall continue to be subject to all other provisions applicable to the Shares as set forth in this Agreement. The use of “Restricted Period” in Section 6.06(b) shall mean (i) the Initial Restricted Period, with respect to the Transfer of Additional Investor Unrestricted Shares (as defined herein), and (ii) the Extended Restricted Period, for the Transfer of all Shares other than the Additional Investor Unrestricted Shares.

(ii)

Subject to compliance with the other provisions of this Agreement, during the Extended Restricted Period, each Additional Investor shall be permitted to Transfer or permit the Transfer of up to 27.5% of the number of Shares originally issued to the Additional Investor or its Affiliates (collectively such Shares, the “Additional Investor Unrestricted Shares”) by or to any Selected Broker (as defined herein) on an agency or principal basis at a price per share of Common Stock of not less than the Minimum Price (as defined herein). “Minimum Price” shall mean $1.50 per share of Common Stock; provided, however, that if during the Extended Restricted Period the Company consummates any issuance and sale of Common Stock in a public offering (a “Qualified Offering”) or pursuant to any at-the-market offering program (an “Equity Distribution Program”) at a price per share of Common Stock of less than $1.50, the Minimum Price shall be reduced to the price per share of Common Stock sold by the Company in such Qualified Offering (as set forth in any final prospectus or final prospectus supplement filed by the Company with the SEC for such public offering) or Equity Distribution Program (upon prompt written notice by the Company to each Additional Investor that a sale of Common Stock pursuant to such Equity Distribution Program has been executed at a price per share of Common Stock below the then applicable Minimum Price). Upon the occurrence of a stock split, reverse stock split, stock dividend, spin-off, rights offering or similar event with respect to the Common Stock, all numbers of shares of Common Stock and prices per share of Common Stock referenced in this Agreement shall be adjusted.

(iii)

Prior to any Transfers of Additional Investor Unrestricted Sales to any third-party during the Extended Restricted Period, the Additional Investors, at their sole cost and expense, shall select one or more registered broker-dealer(s) (each, a “Selected Broker”) through which the Additional Investors will facilitate any Transfer of Additional Investor Unrestricted Shares during the Extended Restricted Period and the Additional Investors shall not Transfer any Additional Investor Unrestricted Shares during the Extended Restricted Period other than through any such Selected Broker. If the Company determines, in its reasonable discretion, that any Additional Investor’s use of a Selected Broker represents a conflict with any activity or proposed activity by the Company involving such Selected Broker, the Additional Investors shall select one or more different Selected Broker(s) through which such Transfers will be facilitated through the end of the Extended Restricted Period. For each monthly anniversary of the Initial Restricted Period during the Extended Restricted Period, each Additional Investor shall provide to the Company, not later than 5 Business Days after the end of such calendar month, a monthly transaction report with respect to any Transfers of Additional Investor Unrestricted Shares by the Additional Investors or their respective Affiliates to a Selected Broker during the applicable calendar month in arrears.

(iv)

Following the end of the Initial Restricted Period, the Company shall promptly cooperate in good faith with the Additional Investors, the transfer agent and registrar for the Common Stock (the “Transfer Agent”), and any Selected Broker to remove any restrictive legends applicable to all of the Additional Investor Unrestricted Shares to facilitate a Transfer to such Additional Investor’s Permitted Transferee or a Selected Broker’s account at the Depository Trust Company, and based upon such Additional Investor complying with any applicable representations and covenants required by the Transfer Agent for the Common Stock with respect to removal of such legends. Upon the expiration of the Extended Restricted Period, the Company shall cooperate in good faith with the Investors, the Transfer Agent and any registered broker-dealer(s) designated by any Investor to remove any restrictive legends applicable to the Shares to facilitate a Transfer to such Investor’s Permitted Transferee or such registered broker-dealer(s), and based upon such Investor complying with any applicable requirements of the Transfer Agent for the Common Stock with respect to removal of such legends. The Company shall not be obligated to remove any restrictive legends applicable to any Shares held by any Investor until such time that any such Shares cease to be subject to the Initial Restricted Period or Extended Restricted Period, as applicable. Each Investor agrees and consents to the entry of stop transfer instructions with the Transfer Agent for the Shares relating to the Transfer, sale or disposal, or purported Transfer, sale or disposal, of such Investor’s Shares in violation of any provision of this Agreement.

(v)

Subject to the other provisions of this Agreement, nothing in this Section 6.06(a) shall prohibit any Investor from establishing a trading plan intended to comply with the requirements of Rule 10b5-1 promulgated under the Exchange Act (each, a “Rule 10b5-1 Trading Plan”) during the Restricted Period; provided, however, that the effectiveness or application of such Rule 10b5-1 Trading Plan shall not result in the Transfer, sale or other disposal of Shares in violation of any provision of this Agreement.

(vi)

In consideration for the provisions set forth in this Section 6.06(a), the Company and the Initial Investors agree that they will not amend the Registration Rights Agreement or Loan Documents (as defined in the Credit Facility) in a manner that adversely affects any Additional Investor (solely in such Additional Investor’s capacity as a Holder (as defined in the Registration Rights Agreement) or Lender (as defined in the Credit Facility) under the Credit Facility), as applicable, in a manner that is materially different from the other Holders (as defined in the Registration Rights Agreement) or Lenders (as defined in the Credit Facility), for so long as such Additional Investor shall hold any Registrable Securities (as defined in the Registration Rights Agreement), with respect to the Registration Rights Agreement, or any Commitments or Loans (as each term defined in the Credit Facility), with respect to the Loan Documents (as defined in the Credit Facility), as applicable.

2.             Miscellaneous.

The Minimum Price set forth herein has been determined solely for the purposes set forth in this Amendment No. 2 as of the date hereof, and is intended by the contracting parties to provide for the orderly sale of the Additional Investor Unrestricted Shares by the Additional Investors from time to time, is intended solely for the benefit of the parties to this Amendment No. 2, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to other of the Company’s investors. Such other Company investors are not third-party beneficiaries of this Amendment No. 2 and should not rely on the Minimum Price as indicative of any view of the value of the price per share of Common Stock or of the Company.

The Investment Agreement remains in full force and effect and nothing in this Amendment No. 2 shall otherwise affect any other provision of the Investment Agreement or the rights and obligations of the parties. Sections 8.07 (Governing Law; Jurisdiction), 8.08 (Specific Enforcement), 8.09 (Waiver of Jury Trial), 8.10 (Execution in Counterparts) and 8.12 (Investors Not a Group) of the Investment Agreement are incorporated herein by reference, mutatis mutandis. This Amendment No. 2, together with the Original Investment Agreement, Amendment No. 1 and the Investment Agreement Joinders shall supersede and replace all prior agreements, promises, and understandings between the parties regarding the subject matter contained in this Amendment No. 2. In the event of any conflict between this Amendment No. 2 and any other agreements or documents described herein, the terms of this Amendment No. 2 shall govern and prevail.

(Signature Page Follows; Remainder of Page Intentionally Left Blank)

IN WITNESS WHEREOF, the parties have executed this Amendment No. 2 to Investment and Investor Rights Agreement as of the date first above written.

	WHEELS UP EXPERIENCE INC.


	By:	/s/ George Mattson
	Name:	George Mattson
	Title:	Chief Executive Officer