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): July 27, 2023

SLEEP NUMBER CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota

(State or other jurisdiction of incorporation)



000-25121			41-1597886
(Commission File Number)			(IRS Employer Identification No.)

1001 Third Avenue South, Minneapolis, MN 55404

(Address of principal executive offices) (Zip Code)

(763) 551-7000

(Registrant’s telephone number, including area code)

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

Common Stock, par value $0.01 per share

SNBR

Nasdaq Global Select Market

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 5.02			DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On July 27, 2023, Sleep Number Corporation (the “Company”) announced that Francis K. Lee has been appointed to the position of Executive Vice President and Chief Financial Officer, effective as of August 14, 2023.

Since 2021, Mr. Lee, age 52, has served as Chief Financial Officer of Wyze Labs, a smart home innovator. Prior to 2021, Mr. Lee held various leadership roles over his 13 years at Nike, Inc., an athletic footwear and apparel brand, including most recently as Vice President, Global Marketing Finance, and previously as Vice President, Strategic Investments, and Vice President, Global Categories and Brand Finance, among other roles.

Pursuant to the terms of the Company’s offer letter dated June 29, 2023, Mr. Lee will be entitled to:

•An annual base salary of $625,000;

•Participate in the Company's Annual Incentive Plan (AIP) for fiscal 2023 with a target incentive of 70% of base salary; the incentive for fiscal 2023 will be prorated based on Mr. Lee's actual eligible earnings received in the fiscal year beginning with his start date;

•A sign-on bonus of $300,000, which must be repaid to the Company if Mr. Lee voluntarily terminates his employment during the first year of employment;

•A combination of long-term incentive awards, which are expected to be granted on August 15, 2023 in accordance with the Company's Long-Team Incentive Plan Grant Practices and Procedures Policy and subject to the terms of the 2020 Equity Incentive Plan and applicable Award Agreements:

–an award of 2023 Performance Stock Units (PSUs) with a total grant value of $900,000, vesting on the third anniversary of the date of grant with the number of shares to be earned based on actual Company performance for fiscal years 2023 to 2025 vs. net sales and net operating profit goals;

–an award of stock options with a total grant value of $1,400,000, vesting 33% per year on each of the first three anniversaries of the date of grant, subject to continued employment; and

–a grant of time-vested Restricted Stock Units (RSUs) with a total grant value of $800,000, vesting 33% per year of each of the first three anniversaries of the date of grant, subject to continued employment.

•Participate in the Company's Executive Severance Pay Plan (under which, upon termination of employment without cause, Mr. Lee would be entitled to severance pay equal to (a) one times the sum of (i) annual base salary and (ii) annual target incentive, plus (b) a pro rata annual incentive for the year of termination); and

•Receive the same perquisites provided to other senior executives of the Company, including reimbursement for tax and financial planning services and the ability to participate in an annual executive physical program; and

•Participate in the same health and welfare benefit plans as the Company makes available to all team members. Mr. Lee will also be eligible to participate in the Sleep Number Profit Sharing and 401(k) Plan and the Sleep Number Executive Deferral Plan in accordance with the respective terms of such plans.

The foregoing description of Mr. Lee's offer letter is a summary of the material terms of the offer letter, and is qualified in its entirety by reference to the complete text of the offer letter, which Sleep Number will file as an exhibit to its next Quarterly Report on Form 10-Q.


Exhibit No.						Description of Exhibit
99.1						Press Release dated July 27, 2023 (furnished herewith)
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURE

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

SLEEP NUMBER CORPORATION

(Registrant)

Dated: July 27, 2023

By:

/s/ Samuel R. Hellfeld

Name:

Samuel R. Hellfeld

Title:

Executive Vice President and Chief Legal and Risk Officer

Exhibit 99.1

FOR IMMEDIATE RELEASE

SLEEP NUMBER APPOINTS FRANCIS LEE TO

EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER

Lee brings a wealth of financial and operational experience from technology-focused, consumer-oriented companies.

MINNEAPOLIS – July 27, 2023 – Sleep Number Corporation (Nasdaq: SNBR), a wellness technology company, today announced the appointment of Francis Lee to Executive Vice President (EVP) and Chief Financial Officer (CFO), effective August 14, 2023. He will assume the role from Chris Krusmark, EVP and Chief Human Resources Officer, who has held the position of Interim CFO since January 2023.

Lee has extensive experience in corporate finance and strategy; his leadership spans consumer product, retail, and technology companies, including Nike, Gap, Inc., and Wyze Labs, an AI-powered, smart home innovator. Most recently, as Wyze Labs CFO, Lee increased cash flow and profitability through a business model evolution from hardware to software with recurring revenue, emphasizing customer lifetime value.

Prior to Wyze, Lee spent 13 years with Nike, including as CFO of Nike Japan, where he drove double-digit growth and margin expansion. He served as Vice President, Global Marketing Finance, a primary partner to the Chief Marketing Officer; Vice President of Finance, responsible for worldwide revenue and margin planning; and Vice President, Enterprise Strategic Investments. He also led corporate FP&A for industry-leading returns. At Gap, Inc., he worked in corporate strategy and business development. Earlier in his career, Lee developed capital allocation strategies as a consultant to Fortune 500 companies for shareholder value creation. He holds a bachelor’s degree from Massachusetts Institute of Technology and an MBA from the Kellogg School of Management at Northwestern University.

“We’re pleased that our comprehensive search led us to Francis. His experience in operational transformation for consumer value and increased profits will be catalysts for our evolving business model and differentiated strategy as we drive long-term superior shareholder value,” said Shelly Ibach, Chair, President and CEO, Sleep Number. “Francis’s deep expertise and personal values complement our business and purpose-driven culture. We’re excited to welcome him to Sleep Number.”

“I’m thrilled to join Sleep Number to have a positive impact on peoples’ lives,” said Lee. “As the company realizes its strategic vision of becoming a connected sleep health leader, I look forward to working with Shelly and the rest of this passionate team to drive

Exhibit 99.1

sustainable, profitable growth and further strengthen Sleep Number’s total shareholder return.”

Krusmark will resume his position of EVP and Chief Human Resources Officer. “I wish to thank Chris for his exceptional leadership as interim CFO. We appreciate his significant contributions to the business, team and the CFO search process,” Ibach said.

Sleep Number also announced its second quarter 2023 earnings today, which can be found on the Sleep Number newsroom.

About Sleep Number Corporation

Sleep Number is a wellness technology company. We are guided by our purpose to improve the health and wellbeing of society through higher quality sleep; to date, our innovations have improved over 14.5 million lives. Our wellness technology platform helps solve sleep problems, whether it’s providing individualized temperature control for each sleeper through our Climate360® smart bed or applying our 21 billion hours of longitudinal sleep data and expertise to research with global institutions.

Our smart bed ecosystem drives best-in-class engagement through dynamic, adjustable, and effortless sleep with personalized digital sleep and health insights; our millions of smart sleepers are loyal brand advocates. And our nearly 5,000 mission-driven team members passionately innovate to drive value creation through our vertically integrated business model, including our exclusive direct-to-consumer selling in 670 stores and online.

To learn more about life-changing, individualized sleep, visit a Sleep Number store near you, our newsroom and investor relations sites, or SleepNumber.com.

Forward-looking Statements

Statements used in this news release relating to future plans, such as the impacts of leaders on our evolving business model are forward-looking statements subject to certain risks and uncertainties. Additional information concerning these, and other risks and uncertainties, is contained in the company’s filings with the Securities and Exchange Commission (SEC), including the Annual Report on Form 10-K, and other periodic reports filed with the SEC. The company has no obligation to publicly update or revise any of the forward-looking statements in this news release.

###

Media contacts:

Julie Elepano

Senior Director, Public Relations

Julie.elepano@sleepnumber.com

Dave Schwantes

Vice President, Investor Relations

David.schwantes@sleepnumber.com

Cover	Jul. 27, 2023
Cover [Abstract]
Document Type	8-K
Document Period End Date	Jul. 27, 2023
Entity Registrant Name	SLEEP NUMBER CORP
Entity Central Index Key	0000827187
Amendment Flag	false
Entity Incorporation, State or Country Code	MN
Entity File Number	000-25121
Entity Tax Identification Number	41-1597886
Entity Address, Address Line One	1001 Third Avenue South
Entity Address, City or Town	Minneapolis
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55404
City Area Code	763
Local Phone Number	551-7000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	SNBR
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false