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): April 27, 2023
Purple Innovation, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Delaware | 001-37523 | 47-4078206 | ||
| (State 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
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K 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 |
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 3.03 MATERIAL MODIFICATION TO RIGHTS OF SECURITY HOLDERS
As previously disclosed, on April 19, 2023, Purple Innovation, Inc., a Delaware corporation (the “Company”), entered into a Cooperation Agreement (the “Cooperation Agreement”) with Coliseum Capital Management, LLC, a Delaware limited liability company (“Coliseum”) (and, solely for purposes of releases and dismissing litigation under the terms of the Cooperation Agreement, Pano Anthos, Gary DiCamillo, Claudia Hollingsworth, Paul Zepf, Dawn Zier, Coliseum Capital Partners, L.P., Coliseum Capital, LLC, and Coliseum Capital Co-Invest III, L.P.). A copy of the Cooperation Agreement is attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 21, 2023, and is incorporated herein by reference.
Stockholder Rights Agreement
On September 25, 2022, the Special Committee (the “Special Committee”) of the Board of Directors of the Company approved the Company’s entry into a stockholder rights agreement and declared a dividend of one right (a “Right”) for each outstanding share of Class A common stock, par value $0.0001 per share and Class B common stock, par value $0.0001 per share, to stockholders of record at the close of business on October 6, 2022. The terms of the Rights were set forth in a Stockholder Rights Agreement, dated as of September 25, 2022, between the Company and Pacific Stock Transfer Company, as rights agent (the “Stockholder Rights Agreement”).
On April 27, 2023, pursuant to the Cooperation Agreement, the Company and Pacific Stock Transfer Company entered into the First Amendment to the Stockholder Rights Agreement (the “Amendment”). The Amendment changed the final expiration time of the Stockholder Rights Agreement from 5:00 p.m. New York City time on September 25, 2023 to 5:00 p.m. New York City time on April 27, 2023. The foregoing description of the Amendment does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Amendment, a copy of which is filed as Exhibit 4.1 hereto and is incorporated herein by reference. The Stockholder Rights Agreement and a description of its material terms were filed with the Securities and Exchange Commission in a Registration Statement on Form 8-A on September 27, 2022.
With this, the Rights expired pursuant to the Stockholder Rights Agreement on April 27, 2023. On the same date, the Company filed with the Secretary of State for the State of Delaware a Certificate of Elimination eliminating from its Second Amended and Restated Certificate of Incorporation, as amended, the designation of certain shares of its preferred stock as Series A Junior Participating Preferred Stock, which had been designated for potential use in connection with the Stockholder Rights Agreement. As a result, all shares of preferred stock previously designated as Series A Junior Participating Preferred Stock were eliminated and returned to the status of authorized but unissued shares of preferred stock, without designation. The foregoing summary of the Certificate of Elimination of the Series A Junior Participating Preferred Stock does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Certificate of Elimination of the Series A Junior Participating Preferred Stock, a copy of which is attached hereto as Exhibit 3.1 and is incorporated herein by reference.
Pursuant to the Cooperation Agreement, the Company agreed not to adopt a new stockholder rights agreement prior to the termination of the Cooperation Agreement without Coliseum’s prior consent.
Proportional Representation Preferred Linked Stock
On April 27, 2023, pursuant to the Cooperation Agreement, the Company redeemed all shares of the Company’s Proportional Representation Preferred Linked Stock (the “PRPLS”) outstanding as of April 27, 2023. On the same date, the Company filed with the Secretary of State for the State of Delaware a Certificate of Elimination eliminating from its Second Amended and Restated Certificate of Incorporation, as amended, the designation of certain shares of its preferred stock as PRPLS. As a result, all shares of preferred stock previously designated as PRPLS were eliminated and returned to the status of authorized but unissued shares of preferred stock, without designation.
The foregoing summary of the Certificate of Elimination of the PRPLS does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Certificate of Elimination of the PRPLS, a copy of which is attached hereto as Exhibit 3.2 and is incorporated herein by reference.
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ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS
Resignation of Directors
Pursuant to the Cooperation Agreement, and not due to any disagreement with the Company or the Company’s Board of Directors (the “Board”) on any matter relating to the Company’s operations, policies, or practices, on April 27, 2023, Pano Anthos and Paul Zepf resigned as directors of the Company. At the time of their resignations, Mr. Anthos served on the Audit Committee and the Nomination & Governance Committee of the Board and Mr. Zepf served as Chair of the Board.
Appointment of New Directors to Board
Pursuant to the Cooperation Agreement, on April 27, 2023, the Company increased the size of the Board to eight (8) directors and appointed S. Hoby Darling, R. Carter Pate, and Erika Serow (the “New Directors”) to the Board. In addition, the Board appointed Adam Gray as Chair of the Board and Gary DiCamillo as Chair of the Nomination & Governance Committee. The New Directors were identified as potential directors and introduced to the Board by Coliseum and were appointed to the Board pursuant to the Cooperation Agreement.
The New Directors shall receive compensation consistent with the Company’s compensation program for non-employee directors, as described in the section title “Directors – Director Compensation” of the Company’s Definitive Proxy Statement filed with the SEC on April 1, 2022. In addition, the Company anticipates entering into an indemnification agreement with each of the New Directors on substantially the same terms as indemnification agreements entered into with other directors.
Except as otherwise disclosed in this Current Report on Form 8-K, there are no arrangements or understandings between any of the New Directors and any other persons pursuant to which they were appointed to the Board and none of the New Directors have direct or indirect material interests in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Termination of Special Committee
Pursuant to the Cooperation Agreement, on April 27, 2023, the Board terminated the Special Committee which had been created on September 25, 2022.
The disclosure set forth in Item 3.03 above is incorporated herein by reference.
ITEM 5.03 AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR
Pursuant to the Cooperation Agreement, on April 27, 2023, the Company amended and restated its bylaws in their entirety. Changes in the Third Amended and Restated Bylaws include, but are not limited to, references to the Company’s Lead Independent Director Charter.
The foregoing summary of the Third Amended and Restated Bylaws does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Third Amended and Restated Bylaws, a copy of which is attached as Exhibit 3.3 to the Company’s Current Report on Form 8-K filed on April 21, 2023 and is incorporated herein by reference.
The disclosure set forth in Item 3.03 above is incorporated herein by reference.
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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits:
3
SIGNATURES
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: April 28, 2023 | PURPLE INNOVATION, INC. | |
| By: | /s/ Casey K. McGarvey | |
| Casey K. McGarvey | ||
| Chief Legal Officer, Secretary | ||
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Exhibit 3.1
CERTIFICATE OF ELIMINATION
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
PURPLE INNOVATION, INC.
Pursuant to Section 151(g) of the
General Corporation Law of the State of Delaware
Purple Innovation, Inc., a Delaware corporation (the “Company”), does, as of this 27th day of April 2023, hereby certify as follows:
1. Pursuant to Section 151(g) of the General Corporation Law of the State of Delaware (the “DGCL”) and the authority conferred upon the Board of Directors of the Company (the “Board”) in accordance with the Company’s Second Amended and Restated Certificate of Incorporation, as amended (the “Charter”), and the Company’s Second Amended and Restated Bylaws, as amended, the Board adopted the following resolutions respecting the Company’s Series A Junior Participating Preferred Stock, which resolutions have not been amended or rescinded:
FURTHER RESOLVED, that no shares of Series A Junior Participating Preferred Stock, par value $0.0001 per share (“Series A Junior Participating Preferred Stock”) are outstanding, and no shares will be issued subject to the Certificate of Designation of Series A Junior Participating Preferred Stock previously filed with the Secretary of State of the State of Delaware on September 26, 2022 with respect to such Series A Junior Participating Preferred Stock (the “Series A Junior Participating Preferred Stock Certificate of Designation”);
FURTHER RESOLVED, that a Certificate of Elimination of the Series A Junior Participating Preferred Stock (the “Series A Junior Participating Preferred Stock Certificate of Elimination”) shall be filed with the Secretary of State of the State of Delaware; and
FURTHER RESOLVED, that when the Series A Junior Participating Preferred Stock Certificate of Elimination setting forth these resolutions becomes effective, it shall have the effect of eliminating from the Charter all matters set forth in the Series A Junior Participating Preferred Stock Certificate of Designation with respect to such Series A Junior Participating Preferred Stock, and all of the shares that were designated as Series A Junior Participating Preferred Stock shall be returned to the status of shares of preferred stock of the Company, without designation as to series.
2. This Certificate of Elimination shall be effective as of 5:00 p.m. Eastern Standard Time on April 27, 2023 (the “Effective Date”).
3. In accordance with Section 151(g) of the DGCL, effective as of the Effective Date, all matters set forth in the Series A Junior Participating Preferred Stock Certificate of Designation, are hereby eliminated from the Charter.
* * * * * * *
IN WITNESS WHEREOF, the Company has caused this Certificate to be signed by its duly authorized officer as of the date first written above.
| PURPLE INNOVATION, INC. | |||
| By: | /s/ Casey K. McGarvey | ||
| Name: | Casey K. McGarvey | ||
| Title: | Chief Legal Officer, Secretary | ||
Certificate of Elimination of Series A Junior Participating Preferred Stock
Exhibit 3.2
CERTIFICATE OF ELIMINATION
OF
PROPORTIONAL REPRESENTATION PREFERRED LINKED STOCK
OF
PURPLE INNOVATION, INC.
Pursuant to Section 151(g) of the
General Corporation Law of the State of Delaware
Purple Innovation, Inc., a Delaware corporation (the “Company”), does, as of this 27th day of April 2023, hereby certify as follows:
1. Pursuant to Section 151(g) of the General Corporation Law of the State of Delaware (the “DGCL”) and the authority conferred upon the Board of Directors of the Company (the “Board”) in accordance with the Company’s Second Amended and Restated Certificate of Incorporation, as amended (the “Charter”), and the Company’s Second Amended and Restated Bylaws, as amended, the Board adopted the following resolutions respecting the Proportional Representation Preferred Linked Stock, which resolutions have not been amended or rescinded:
FURTHER RESOLVED, . . . that no shares of the Company’s “Proportional Representation Preferred Linked Stock” (the “PRPLS”) are outstanding and none shall be issued subject to the Certificate of Designation filed with the Secretary of State of the State of Delaware on February 14, 2023 (the “PRPLS COD”);
FURTHER RESOLVED, that a Certificate of Elimination of the PRPLS (the “PRPLS Certificate of Elimination”) shall be filed with the Secretary of State of the State of Delaware; and
FURTHER RESOLVED, that when the PRPLS Certificate of Elimination setting forth these resolutions becomes effective, it shall have the effect of eliminating from the Charter all matters set forth in the Certificate of Designation with respect to such PRPLS, and all of the shares that were designated as PRPLS shall be returned to the status of authorized but unissued shares of preferred stock of the Company, without designation as to series.
2. This Certificate of Elimination shall be effective as of 5:00 p.m. Eastern Standard Time on April 27, 2023 (the “Effective Date”).
3. In accordance with Section 151(g) of the DGCL, effective as of the Effective Date, all matters set forth in the PRPLS COD, are hereby eliminated from the Charter.
* * * * * * *
IN WITNESS WHEREOF, the Company has caused this Certificate to be signed by its duly authorized officer as of the date first written above.
| PURPLE INNOVATION, INC. | |||
| By: | /s/ Casey K. McGarvey | ||
| Name: | Casey K. McGarvey | ||
| Title: | Chief Legal Officer, Secretary | ||
Certificate of Elimination of Proportional Representation Preferred Linked Stock
Exhibit 4.1
FIRST AMENDMENT TO
STOCKHOLDER RIGHTS AGREEMENT
THIS FIRST AMENDMENT TO THE STOCKHOLDER RIGHTS AGREEMENT, dated as of April 27, 2023 (this “Amendment”), is made by and between Purple Innovation, Inc., a Delaware corporation (the “Company”), and Pacific Stock Transfer Company, a registered transfer agent, as rights agent (the “Rights Agent”).
WHEREAS, the Company and the Rights Agent entered into the Stockholder Rights Agreement, dated as of September 25, 2022 (the “Agreement”);
WHEREAS, Section 27 of the Agreement provides, among other things, that, prior to the Stock Acquisition Date (as defined in the Agreement), the Company and the Rights Agent may from time to time supplement or amend the Agreement without the approval of any holders of Rights (as defined in the Agreement);
WHEREAS, no Stock Acquisition Date has occurred on or prior to the date hereof;
WHEREAS, the Board of Directors of the Company (the “Board”) has determined it is in the best interests of the Company and its stockholders to amend the Agreement as set forth herein; and
WHEREAS, the Board has authorized and approved this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company hereby agrees to amend the Agreement as follows and directs the Rights Agent to execute this Amendment:
| 1. | The text of clause (a)(i) of Section 7 of the Agreement is hereby deleted and replaced in its entirety with the following: “the Close of Business on April 27, 2023 (the “Final Expiration Time”),”. |
| 2. | Exhibit B to the Agreement is hereby amended as follows: |
| a. | The reference to “SEPTEMBER 25, 2023” on page B-1 is hereby deleted and replaced in its entirety with the following: “APRIL 27, 2023”. |
| b. | The first sentence on page B-2 is hereby deleted and replaced in its entirety with the following: |
“This certifies that __________, or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of the Rights Agreement, dated as of September 25, 2022 (as amended from time to time in accordance with its terms, the “Rights Agreement”), by and between Purple Innovation, Inc., a Delaware corporation (the “Company”), and Pacific Stock Transfer Company, the rights agent (and any successor rights agent, the “Rights Agent”), to purchase from the Company at any time prior to 5:00 P.M. (New York City time) on April 27, 2023 at the office or offices of the Rights Agent designated for such purpose, or its successors as Rights Agent, one one-thousandth of a fully paid, non-assessable share of Series A Junior Participating Preferred Stock, par value $0.0001 per share (the “Preferred Stock”), of the Company, at an exercise price of $20.00 per one one-thousandth of a share (the “Exercise Price”), upon presentation and surrender of this Rights Certificate with the Form of Election to Purchase and related Certificate properly completed and duly executed.”
| 3. | Exhibit C to the Agreement is hereby amended as follows: |
| a. | The text of clause (a) in the paragraph titled “Expiration Time” on page C-2 is hereby deleted and replaced in its entirety with the following: “the close of business on April 27, 2023 (the “Final Expiration Time”),”. |
| 4. | This Amendment is effective as of the date first set forth above. |
| 5. | Capitalized terms used but not defined herein shall have the respective meanings ascribed to such terms in the Agreement. |
| 6. | This Amendment may be executed in any number of counterparts; each such counterpart shall for all purposes be deemed to be an original; and all such counterparts shall together constitute but one and the same instrument. A signature to this Amendment executed and/or transmitted electronically shall have the same authority, effect and enforceability as an original signature. |
| 7. | Except as modified hereby, the Agreement is reaffirmed in all respects, and all references therein to “the Agreement” shall mean the Agreement, as modified hereby. |
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first written above.
| PURPLE INNOVATION, INC. | |||
| By: | /s/ Casey K. McGarvey | ||
| Name: | Casey K. McGarvey | ||
| Title: | Chief Legal Officer, Secretary | ||
| PACIFIC STOCK TRANSFER COMPANY | |||
| By: | /s/ William Miller | ||
| Name: | William Miller | ||
| Title: | Chief Operating Officer | ||
Signature Page to First Amendment to Stockholder Rights Agreement