{"url_path":"/sec/snbr/8-k/2026-06-16/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 Entry","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-06-16","source_url":"https://www.sec.gov/Archives/edgar/data/827187/0000950103-26-009081-index.html","accession_number":"0000950103-26-009081","cik":"0000827187","ticker":"SNBR","issuer_name":"Sleep Number Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/827187/0000950103-26-009081-index.html","primary_entity_key":"0000827187","primary_entity_name":"Sleep Number Corp"},"word_count":1347,"has_tables":true,"body_markdown":"**Item 1.01    Entry\ninto a Material Definitive Agreement**\n\n \n\nOn June 16, 2026, Sleep\nNumber Corporation (“Sleep Number” or the “Company”) and its subsidiaries (together with Sleep Number, the\n“Debtors”) entered into the Fourteenth Amendment (the “DIP Amendment”) to\nAmended and Restated Credit and Security Agreement (the “Prepetition Credit Agreement”, and as amended by the DIP\nAmendment, the “DIP Credit Agreement”). Pursuant to the DIP Credit Agreement, the prepetition lenders under the\nPrepetition Credit Agreement (collectively, the “DIP Lenders”) have committed to provide up to $260 million of\ndebtor-in-possession financing in the form of (i) new money superpriority senior secured term loan commitments in an aggregate\nprincipal amount of up to $65 million (the term loans made thereunder, the “DIP Loans”), available in multiple draws in\nan amount of up to $50 million upon entry of the interim DIP order and in an amount up to the difference between $65 million and the\namount of DIP Loans actually funded prior to the entry of the final DIP order and (ii) roll-up loans comprising secured obligations\nunder the Prepetition Credit Agreement that shall be converted and exchanged into roll-up loans under the DIP Credit Agreement in an\naggregate principal amount of up to $195 million (the “Roll-Up Loans”). On June 15, 2026, the Bankruptcy Court for the\nSouthern District of New York (the “Bankruptcy Court”) entered the interim DIP order approving the transaction on an\ninterim basis through the final hearing which is currently scheduled for July 9, 2026.\n\n \n\nSleep Number’s obligations\nunder the DIP Loans and the Roll-Up Loans are guaranteed by each subsidiary of the Company. In addition, subject to the terms of the\ninterim DIP order approving the DIP Loans and the Roll-Up Loans (or the final DIP order, when entered), the claims of the DIP Lenders\nare (or are expected to be) (i) entitled to superpriority administrative expense claim status and, subject to certain customary exclusions\nin the credit documentation, (ii) secured by (a) a perfected first priority lien on all DIP Collateral (as defined in the interim DIP\norder), to the extent such collateral is unencumbered, (b) a perfected priming senior security interest in and liens on the prepetition\ncollateral, and (c) a perfected junior security interest in and liens on the DIP Collateral to the extent such DIP Collateral is subject\nto permitted prior senior liens.\n\n \n\nPursuant to the DIP Amendment,\nSleep Number may make optional prepayments of the DIP Loans, in whole or in part, without penalty (other than applicable breakage and\nredeployment costs and the payment of certain other fees, including an exit fee). In addition, subject to certain exceptions and conditions\ndescribed in the DIP Amendment, Sleep Number is obligated to prepay the obligations thereunder with the net cash proceeds of certain asset\nsales, casualty insurance proceeds, extraordinary receipts or the proceeds of any indebtedness not permitted to be incurred pursuant\nto the terms of the DIP Amendment.\n\n \n\nThe scheduled maturity date\nof the DIP Loans and the Roll-Up Loans is September 16, 2026. The DIP Loans and the Roll-Up Loans will bear an interest rate per annum\nequal to either SOFR plus 8.00% or the “base rate” plus 7.00%.\n\n \n\nThe DIP Credit Agreement\ncontains representations, warranties and covenants that are typical and customary for these types of debtor-in-possession\nfacilities, including, but not limited to specified restrictions on indebtedness, liens, investments, loans and guaranties, mergers\nand sales of assets, acquisitions, restricted payments, voluntary payments of other indebtedness, transactions with affiliates, sale\nand leaseback transactions and compliance with case milestones (including regarding a sale of substantially all of the assets of the\nCompany and its subsidiaries), restrictive agreements, bankruptcy matters, cash management order and assumption or rejection of\ncontracts and leases. The DIP Credit Agreement contains customary events of default, including as a result of certain events\noccurring in the Chapter 11 Cases. The DIP Credit Agreement requires compliance with variance covenants that compare actual\noperating disbursements, expenditures and receipts to the budgeted amounts set forth in the DIP budgets\ndelivered to the DIP Agent and DIP Lenders on or prior to the closing date and updated periodically thereafter pursuant to the\nterms of the DIP Amendment. The proposed DIP facility remains subject to final approval by the Bankruptcy Court and each drawing\nthereunder is subject to certain conditions precedent.\n\n \n\nThe foregoing description\nof the DIP Amendment and DIP Credit Agreement does not purport to be complete and is qualified in its entirety by reference to the DIP\nAmendment and DIP Credit Agreement filed hereto as Exhibit 10.1.\n\n \n\n \n\n \n\n*Cautionary Statement Regarding Forward-Looking Statements*\n\n \n\nThis Current Report on Form\n8-K and the Exhibits hereto contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995,\nwhich are subject to risks, uncertainties and assumptions that are difficult to predict. Forward-looking statements are predictions based\non our current expectations and our projections about future events, and are not statements of historical fact. Forward-looking statements\ninclude statements concerning our business strategy, among other things, including anticipated trends and developments in, and management\nplans for, our business and the markets in which we operate. In some cases, you can identify these statements by forward-looking words,\nsuch as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,”\n“believe,” “forecast,” “foresee,” “likely,” “may,” “should,” “goal,”\n“target,” “might,” “will,” “could,” “predict,” and “continue,”\nthe negative or plural of these words and other comparable terminology. All forward-looking statements included in this Form 8-K are based\nupon information available to us as of the filing date of this Form 8-K, and we undertake no obligation to update any of these forward-looking\nstatements for any reason. You should not place undue reliance on these forward-looking statements. These forward-looking statements involve\nknown and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements\nto differ materially from those expressed or implied by these statements. These factors include the matters discussed in “Part I\n- Item 1A - Risk Factors” in our Annual Report on Form 10-K for the year ended January 3, 2026 as well as the additional factors\nincluded below. You should carefully consider the risks and uncertainties described under these sections.\n\n \n\nA wide range of factors relating\nto the Chapter 11 Cases could materially affect future developments and performance, including but not limited to:\n\n \n\n \n•\nour ability to continue as a going concern;\n\n \n•\nour ability to successfully consummate the planned sale of the business pursuant to Section 363 of the Bankruptcy Code to any potential acquirer through an auction process in Chapter 11 and if consummated, to obtain an adequate price;\n\n \n•\nour ability to successfully complete a reorganization under Chapter 11 and emerge from bankruptcy;\n\n \n•\nthe effects of the Chapter 11 Cases on us and on the interests of various constituents;\n\n \n•\nbankruptcy court rulings in the Chapter 11 Cases and the outcome of the Chapter 11 Cases in general;\n\n \n•\nthe length of time the Company will operate under the Chapter 11 Cases;\n\n \n•\nrisks associated with third-party motions in the Chapter 11 Cases;\n\n \n•\nthe potential adverse effects of the Chapter 11 Cases on our liquidity and results of operations;\n\n \n•\nincreased legal and other professional costs necessary to execute our reorganization;\n\n \n•\nthe conditions to which our debtor-in-possession financing is subject, and the risk that these conditions may not be satisfied for various reasons, including for reasons outside of our control;\n\n \n•\nthe consequences of the acceleration of our debt obligations;\n\n \n•\nemployee attrition and our ability to retain senior management and key personnel due to the distractions and uncertainties, including our ability to provide adequate compensation and benefits during the Chapter 11 Cases;\n\n \n•\nour ability to comply with the restrictions imposed by the DIP Amendment;\n\n \n•\nthe likely cancellation of our common shares in the Chapter 11 Cases;\n\n \n•\nthe potential material adverse effect of claims that are not discharged in the Chapter 11 Cases;\n\n \n•\nthe diversion of management’s attention as a result of the Chapter 11 Cases; and\n\n \n•\nvolatility of our financial results as a result of the Chapter 11 Cases."}