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Upland Software, Inc. Adopts Tax Benefit Preservation Plan for Net Operating Losses
AUSTIN, Texas--(BUSINESS WIRE)-- Upland Software, Inc. (“Upland”) (NASDAQ: UPLD) announced today that its Board of Directors (the “Board”) has adopted a tax
About this update from Upland Software, Inc.
[{"type":"text","content":" AUSTIN, Texas--(BUSINESS WIRE)--\nUpland Software, Inc. (“Upland”) (NASDAQ: UPLD) announced today that its Board of Directors (the “Board”) has adopted a tax benefit preservation plan (the “Plan”) designed to preserve the availability of its net operating loss carryforwards (“NOLs”) and other tax attributes under the Internal Revenue Code (the “Code”).\n\n\nAs of March 31, 2023, Upland had approximately $147 million of U.S. federal NOLs as well as other tax attributes that could be available in certain circumstances to reduce future U.S. corporate income tax liabilities. These NOLs are primarily attributable to the pre-acquisition operations of the entities acquired by Upland since its founding in 2010, including acquisition-related expenses. Upland’s ability to use these NOLs (as well as other tax attributes) would be substantially limited if Upland were to experience an “ownership change” within the meaning of Section 382 of the Code. In general, an ownership change would occur if stockholders that own (or are deemed to own) at least 5 percent or more of Upland’s stock increased their cumulative ownership in Upland by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. The Plan is intended to reduce the likelihood of such an ownership change by deterring any person or group from acquiring beneficial ownership of 4.9% or more of Upload’s outstanding common stock.\n\n\nThe Plan is similar to those adopted by numerous other public companies with significant NOLs. The Plan is not designed to prevent any action that the Board determines to be in the best interests of Upland and its stockholders, and will help to ensure that the Board remains in the best position to discharge its fiduciary duties.\n\n\nAs part of the Plan, the Board declared a dividend of one preferred stock purchase right, which are referred to as “rights,” for each outstanding share of Upland common stock. The dividend will be payable to holders of record as of the close of business on May 12, 2023. Any shares of Upland common stock issued after the record date will be issued together with the rights.\n\n\nThe rights will initially trade with Upland’s common stock and will generally become exercisable if a person or group, without the approval of the Board, acquires 4.9% or more of Upland’s outstanding common ...