Sleep Number (SNBRQ) ups asset sale to $529.5M cash deal

Rhea-AI Filing Summary

Sleep Number Corporation agreed to an Amended and Restated Asset Purchase Agreement with SNBR, Inc., a subsidiary of Sleep Country Canada Inc., for the sale of substantially all of its assets. The base cash purchase price increased from $415,000,000 to $529,500,000, subject to purchase price adjustments. The Purchaser’s deposit into the adjustment escrow account was reduced from $25,000,000 to $10,000,000, and several potential purchase price deductions related to undelivered customer orders, payment card processor reserves, and cure costs were narrowed.

The revised agreement eliminates certain pre-closing covenants and closing conditions, including minimum marketing expenditures, a pre-closing inventory count, and minimum employee and executive acceptance thresholds. It adds a new closing condition requiring funding of a segregated Stub Rent Reserve of $5,193,168 for unpaid lease obligations from June 12–30, 2026. Completion of the asset sale remains subject to Bankruptcy Court approval, antitrust clearance under the Hart-Scott-Rodino Act, absence of blocking governmental orders or antitrust actions, performance and accuracy of the parties’ obligations and representations, and the Purchaser’s condition that the Company has not experienced a material adverse effect. The agreement also provides for a break-up fee, expense reimbursement to the Purchaser in certain events, and potential forfeiture of a deposit to the Company.

8-K Event Classification

2 items: 1.01, 9.01

2 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Key Figures

Base purchase price: $529,500,000 Original stalking horse price: $415,000,000 Revised escrow deposit: $10,000,000 +2 more

5 metrics

Base purchase price $529,500,000 Cash consideration under the Amended and Restated Asset Purchase Agreement for substantially all assets

Original stalking horse price $415,000,000 Base cash purchase price in the initial Stalking Horse Purchase Agreement

Revised escrow deposit $10,000,000 Amount to be deposited by the Purchaser into the adjustment escrow account under the amended agreement

Prior escrow deposit $25,000,000 Escrow amount required under the original Stalking Horse Purchase Agreement

Stub Rent Reserve $5,193,168 Segregated reserve for unpaid lease obligations from June 12, 2026 through June 30, 2026, required at closing

Key Terms

stalking horse, Asset Purchase Agreement, Stub Rent Reserve, Hart-Scott-Rodino Antitrust Improvements Act of 1976, +1 more

5 terms

stalking horse financial

"entered into a “stalking horse” Asset Purchase Agreement"

A stalking horse is an initial bidder chosen in a court-supervised sale of a company or its assets to set a baseline offer and encourage competitive bidding. Think of it as the opening bid at an auction: it establishes a minimum price and terms for the sale and often receives a small fee or protection if another buyer tops the offer, which helps protect value for creditors and informs investors about likely recovery from the sale.

Asset Purchase Agreement financial

"entered into an Amended and Restated Asset Purchase Agreement"

An asset purchase agreement is a legal contract in which a buyer agrees to buy specific assets and contracts of a business rather than buying the company’s stock or ownership. It matters to investors because it determines exactly what is being bought and what liabilities stay behind — like buying the furniture and equipment from a store but not the building or past debts — which affects the deal’s value, taxes and future risk exposure.

Stub Rent Reserve financial

"funded a segregated “Stub Rent Reserve” in the amount of $5,193,168"

Hart-Scott-Rodino Antitrust Improvements Act of 1976 regulatory

"waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976"

material adverse effect financial

"conditioned upon the Company having not experienced a material adverse effect"

A material adverse effect is a significant negative change or event that substantially reduces a company’s business, financial condition, or future prospects — think of it like a sudden major engine failure that makes a car unreliable. Investors care because such an event can lower expected profits, trigger contract clauses (allowing counterparties to renegotiate or walk away), and prompt swift stock-price reassessment based on the higher risk and uncertainty.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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FAQ

What asset sale agreement did Sleep Number (SNBRQ) enter into on July 18, 2026?

Sleep Number entered into an Amended and Restated Asset Purchase Agreement with SNBR, Inc., a subsidiary of Sleep Country Canada Inc., to sell substantially all of its assets for a cash purchase price subject to defined adjustments and conditions.

How did the asset sale purchase price change for Sleep Number (SNBRQ)?

The base cash purchase price increased from $415,000,000 under the stalking horse agreement to $529,500,000 in the amended agreement. The Purchaser’s adjustment escrow deposit decreased from $25,000,000 to $10,000,000, and certain potential purchase price deductions were reduced.

What major conditions must be met before Sleep Number (SNBRQ) can close the asset sale?

Closing requires a Bankruptcy Court order approving the sale, expiration or termination of the Hart-Scott-Rodino waiting period, no blocking FTC or DOJ antitrust actions, no governmental order prohibiting the sale, performance of obligations, accurate representations, and no material adverse effect on the Company.

What is the Stub Rent Reserve requirement in Sleep Number’s (SNBRQ) amended agreement?

The amended agreement requires Sleep Number to fund a segregated Stub Rent Reserve of $5,193,168 under the approved budget. This reserve is on account of unpaid lease obligations for the period from June 12, 2026 through June 30, 2026 and is a condition to closing.

Which pre-closing covenants were removed in Sleep Number’s (SNBRQ) amended asset purchase agreement?

The amended agreement removes covenants requiring minimum marketing expenditures through closing, a pre-closing inventory count, and closing conditions tied to a minimum employee acceptance threshold and acceptance of employment by a specified percentage of designated executives.

Does Sleep Number’s (SNBRQ) amended agreement include break-up protections?

Yes. The amended agreement includes a break-up fee and expense reimbursement payable to the Purchaser if certain events occur, and also provides that the Purchaser’s deposit may be forfeited to the Company upon the occurrence of other specified events.

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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 18, 2026

Sleep Number Corporation

(Exact name of registrant as specified in its charter)

Minnesota	000-25121	41-1597886
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1001 3rd 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 (see General Instruction A.2. below):

☐ 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 communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communication 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: None

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405 of this chapter) or Rule 20-2 of the Securities Exchange Act of 1934 (17 CFR §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 1.01 Entry into a Material Definitive Agreement

As previously disclosed, on June 12, 2026, Sleep Number Corporation (“Sleep Number” or the “Company”) entered into a “stalking horse” Asset Purchase Agreement (the “Stalking Horse Purchase Agreement”) with SNBR, Inc., a wholly-owned subsidiary of Sleep Country Canada Inc. (in such capacity, the “Purchaser”) and Sleep Country Canada Inc. pursuant to which the Purchaser agreed to purchase substantially all of the assets of the Company (such assets, the “Assets,” and such transaction, the “Asset Sale”) for a purchase price of $415 million in cash and the assumption of certain liabilities, subject to certain potential purchase price adjustments, in each case, as set forth in the Stalking Horse Purchase Agreement.

Following a Bankruptcy Court-supervised auction process, on July 18, 2026, the Company entered into an Amended and Restated Asset Purchase Agreement (the “Amended and Restated Purchase Agreement”) with the Purchaser and Sleep Country Canada Inc., which amends and restates the Stalking Horse Purchase Agreement in its entirety.

The Amended and Restated Purchase Agreement includes an increase in the base purchase price payable in cash from $415,000,000 to $529,500,000, subject to certain purchase price adjustments, and reduced the amount to be deposited by the Purchaser into the adjustment escrow account from $25,000,000 to $10,000,000.

The Amended and Restated Purchase Agreement also reduced a number of potential purchase price deductions that were included in the Stalking Horse Purchase Agreement, including potential adjustments to the purchase price related to undelivered customer orders, payment card processor reserve deposits, and cure costs payable to counterparties in connection with the assumption and assignment of executory contracts and unexpired leases. In addition, the Amended and Restated Purchase Agreement eliminates certain pre-closing covenants and related closing conditions that had been included in the Stalking Horse Purchase Agreement, including a covenant requiring the Company to maintain certain minimum marketing expenditures during the interim period through closing, a covenant requiring a pre-closing inventory count and a closing conditions requiring the satisfaction of a minimum employee acceptance threshold and acceptance of employment by a specified percentage of designated executives.

The Amended and Restated Purchase Agreement includes a new closing condition requiring the Company to have funded a segregated “Stub Rent Reserve” in the amount of $5,193,168, in accordance with the approved budget, on account of unpaid lease obligations due under property leases for the period from June 12, 2026 through June 30, 2026.

The Amended and Restated Purchase Agreement contains customary representations, warranties and covenants of the parties for a transaction involving the acquisition of assets from a debtor in bankruptcy, and the completion of the Asset Sale is subject to a number of conditions, which, among others, include (i) the entry of an order of the Bankruptcy Court authorizing and approving the Asset Sale, (ii) the performance by each party of its obligations under the Amended and Restated Purchase Agreement (subject to certain materiality qualifiers), (iii) the accuracy of each party's representations (subject to certain materiality qualifiers), (iv) the delivery of certain closing deliverables, (v) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, (vi) the absence of any judicial or administrative proceeding by the Federal Trade Commission or the United States Department of Justice Antitrust Division that seeks to prevent, restrain, enjoin or prohibit the Asset Sale under antitrust laws, and (vii) the absence of any order by any governmental authority that restrains, enjoins, stays, or prohibits the consummation of the Asset Sale. The obligation of the Purchaser to consummate the Asset Sale is also conditioned upon the Company having not experienced a material adverse effect. The Amended and Restated Purchase Agreement also provides for a break-up fee and expense reimbursement payable to the Purchaser upon the occurrence of certain events, and the forfeiture of a deposit to the Company upon the occurrence of certain events.

The foregoing description of the Amended and Restated Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Purchase Agreement, a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number		Description
10.1*		Amended and Restated Asset Purchase Agreement, dated as of July 18, 2026, by and between the Company, the Purchaser and for certain sections therein, Sleep Country Canada Inc.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

* In accordance with Item 601(a)(5) of Regulation S-K, certain schedules or similar attachments to this exhibit have been omitted from this filing.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

				Sleep Number Corporation (Registrant)
Date: July 23, 2026				By:		/s/ Samuel R. Hellfeld
				Name:		Samuel R. Hellfeld
				Title:		Executive Vice President, Chief Legal and Risk Officer

Filing Exhibits & Attachments

4 documents

Agreements & Contracts

• EX-10.1 EXHIBIT 10.1 613.7 KB

Other Documents

• EX-101 XBRL SCHEMA FILE 3.0 KB
• EX-101 XBRL LABEL FILE 33.4 KB
• EX-101 XBRL PRESENTATION FILE 21.8 KB