Dallas, December 15, 2022 /PRNewswire/ — The following is a letter from AWH Capital, LP to the Chief Executive Officer of Purple Innovation regarding Coliseum Capital Management’s recent acquisition proposal.

December 15, 2022
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Paul Zepf
President of the Board of Directors
Lila Innovation, Inc.
4100 North Chapel Ridge Road, Suite 200
Lehi, U.T 84043

Dear Paul,

We are shareholders of Purple Innovation, Inc. (“Purple”). We believe that Purple is currently trading at a significant discount to intrinsic value and could appreciate significantly over time. As such, we believe Coliseum Capital Management Purple’s recent takeover proposal should be significantly underrated and rejected.

In a challenging year for the mattress industry, CEO of Purple Rob DeMartini and his team have achieved quarterly profitability while making significant improvements to their operational structure. These improvements include: focusing marketing spend on more effective channels; Manufacturing footprint optimization; addressing balance sheet issues; and completed a value-added acquisition that enhances the premium end of its product portfolio. The company is now preparing to launch new products that will broaden the breadth of its offering and allow better differentiation between price tiers while reducing input costs.

The mattress industry has generally been resilient over time and now appears to be stabilizing. We look forward to seeing you Rob DeMartini as CEO due to his track record as CEO of New Balance, his understanding of the value of the Purple brand and his focus on execution. In addition, we have strong confidence in Purple’s competitive position given its leadership role in the emerging but growing gel grid segment of the mattress industry.

We call on the company to fulfill its fiduciary duty to all shareholders and oppose Coliseum’s proposal.

sincerely,

Austin Hopper