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Item 5. Other Information

2021-05-17 compared with 2020-11-10 · 36 added, 71 removed, 8 unchanged (93% of the section changed)

OTHER INFORMATION

On November 4, 2020,

the Company’s Board approved a Short-Term Cash Incentive Plan (the “STIP”) for the 2020 plan year.

Participation

in the STIP is limited to key employees who are employed to serve as Senior Vice Presidents, Vice Presidents, or Senior Directors.

Not all eligible employees are guaranteed to participate in the plan, as participation will be subject to Board discretion and

The STIP will be administered by the HR & Compensation Committee as authorized by the Board.

For the STIP to activate,

the company must achieve certain net revenue and adjusted EBITDA targets.

If the Company does not reach the minimum targets, no

cash awards will be paid to any of the participants under the Plan.

The amount of the total payment to each participant is adjustable

to account for personal performance criteria, as follows:

70% of the amount is based on the Company’s achievement of at least

the minimum Company-level performance targets and the remaining 30% is based on the participant’s achievement of personal

performance criteria selected or approved by the Board.

Subject to the other provisions of the STIP, payment to a participant will

be made in cash in an amount up to the product determined by multiplying a certain percentage from 50% to 150% by the participant’s

targeted bonus amount.

That percentage will be determined based on whether and the extent to which the net revenue target and adjusted

EBITDA target both exceed certain minimum target threshold amounts.

The bonus target applicable to each participant is determined

by multiplying (x) the participant’s annual base salary by (y) the participant’s share of the total bonus fund amount,

as determined in accordance with the STIP.

A participant will have no right to receive a payment under the STIP unless the

participant remains in good standing with the Company during the plan year and remains in the employ of the Company through and

including the payment date in 2021.

This summary of the STIP does not purport to be complete and is subject to, and qualified in

its entirety by, the full text of the STIP, which is attached as Exhibit 10.11 to this 10-Q and is incorporated by reference herein.

On November 9, 2020,

we mailed to Paul Zepf a notice terminating Mr.

Zepf’s Observer and Indemnification Agreement dated February 2, 2018 (the

“Observer Agreement”).

Zepf was appointed to the Board of Directors on August 18, 2020, his service as an

observer was no longer necessary.

The Observer Agreement provided for one-year automatic renewals until we provided written notice

of termination not less than thirty days prior to the renewal period.

Lease Agreement between Purple Innovation, LLC and PNK S2, LLC dated July 21, 2020.

License Transfer and IP Assignment Agreement between Purple Innovation, LLC and EdiZONE, LLC dated August 14, 2020.

Indemnification Agreement between Purple Innovation, Inc.

and Paul Zepf dated August 18, 2020.

Waiver and Consent to Amended and Restated Credit Agreement dated August 20, 2020.

Credit Agreement dated September 3, 2020 between and among Purple Innovation, LLC, Purple Innovation, Inc., KeyBank National Association, and the other lenders party thereto.

Pledge and Security Agreement dated September 3, 2020.

Guaranty dated September 3, 2020.

Collateral Assignment of Patents dated September 3, 2020.

Collateral Assignment of Trademarks dated September 3, 2020.

Collateral Assignment of Copyrights dated September 3, 2020.

Purple Innovation, Inc.

2020 Short-Term Cash Incentive Plan.

Certification by Joseph B.

Megibow, Chief Executive Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification by Craig L.

Phillips, Chief Financial Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification by Joseph B.

Megibow, Chief Executive Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification by Craig L.

Phillips, Chief Financial Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

and Restated Bylaws

1 to the Amended and Restated Bylaws

Amendment to Lease Agreement between Purple Innovation, LLC and PNK S2, LLC dated March 4, 2021.

Amendment to Lease Agreement between Purple Innovation, LLC and PNK S2, LLC dated March 26, 2021.

Certification

Megibow, Chief Executive Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant

to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification

Phillips, Chief Financial Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant

to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification

Megibow, Chief Executive Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant

to Section 906 of the Sarbanes-Oxley Act of 2002.

Certification

Phillips, Chief Financial Officer, pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant

to Section 906 of the Sarbanes-Oxley Act of 2002.

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