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): August 22, 2024
Purple Innovation, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Delaware | | 001-37523 | | 47-4078206 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer
Identification No.) |
| 4100 North Chapel Ridge Rd., Suite 200 | | |
| Lehi, Utah | | 84043 |
| (Address of principal executive offices) | | (Zip Code) |
Registrant’s telephone number, including area code: (801) 756-2600
N/A
(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 communication 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-commencements 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, par value $0.0001 per share | | PRPL | | The NASDAQ Stock Market LLC |
| Preferred Stock Purchase Rights | | N/A | | The NASDAQ Stock Market LLC |
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 2.05 COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES
On August 22, 2024, Purple Innovation, Inc. (the “Company”) announced the planned closure of its manufacturing facilities in Grantsville, Utah and Salt Lake City, Utah and the consolidation of its manufacturing operations into its McDonough, Georgia facility. The Company reduced headcount at its Lehi, Utah headquarters to additionally drive operating efficiencies. The closure of the Utah manufacturing facilities is expected to be completed during the first quarter of 2025. The consolidation into the McDonough, Georgia facility is expected to be completed by December 31, 2024. The reduction in workforce at the Lehi, Utah headquarters was completed on August 22, 2024.
These actions are expected to result in an estimated range of restructuring-related costs and charges of $35 million to $45 million, beginning in the third quarter of 2024 through the second quarter of 2025 and are expected to result in an approximate 13% net reduction of the Company’s workforce. These costs and charges are estimated to range from $4 million to $6 million related to employee terminations, $5 million to $7 million in wind-down expenses related to the closure of the Utah manufacturing facilities and relocation to the McDonough, Georgia facility and $26 million to $32 million in non-cash charges related to disposition of equipment and other write downs. The Company estimates it will incur future cash expenditures in the range of $9 million to $13 million related to the restructuring. Once the restructuring is fully implemented, the Company expects annualized savings in the range of $15 million to $20 million, starting in 2025.
ITEM 7.01 REGULATION FD DISCLOSURE
On August 22, 2024, the Company issued a press release related to the consolidation of its mattress production operations into its McDonough, Georgia facility and the planned closure of two manufacturing facilities in Salt Lake City and Grantsville, Utah. A copy of this press release is furnished as Exhibit 99.1 to this report.
The information in this Item 7.01, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed to be “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 to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in any such filing.
The press release furnished herewith in Exhibit 99.1 contains non-GAAP financial measures. Management believes non-GAAP financial measures assist management and investors in evaluating and comparing period-to-period results and projections in a more meaningful and consistent manner.
Forward-Looking Statements
Certain statements made herein that are not historical facts are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Statements based on historical data are not intended and should not be understood to indicate the Company’s expectations regarding future events. Forward-looking statements provide current expectations or forecasts of future events or determinations. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Factors that could influence the realization of forward-looking statements include, among others: changes in economic, financial and end-market conditions in the markets in which we operate; fluctuations in raw material prices and cost of labor; the financial condition of our customers and suppliers; competitive pressures, including the need for technology improvement, successful new product development and introduction; changes in consumer demand, including pullbacks in consumer spending; disruptions to our manufacturing processes; our ability to recognize the anticipated benefits of our planned facility closures and consolidation; charges, costs or actions, including adverse legal or regulatory actions, resulting from, or in connection with the closure of our Grantsville, Utah and Salt Lake City, Utah facilities; and the risk factors outlined in the “Risk Factors” section of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 12, 2024, and in our other filings made with the SEC. The Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits.
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.
| Dated: August 22, 2024 | PURPLE INNOVATION, INC. |
| | | |
| | By: | /s/ Todd Vogensen |
| | | Todd Vogensen |
| | | Chief Financial Officer |
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