Item 2.05 Costs Associated with Exit or Disposal Activities.
On June 30, 2022, Enjoy Technology Canada Ltd. ("Enjoy Canada"), an indirect,
wholly owned subsidiary of Enjoy Technology, Inc. (the "Company"), commenced a
reduction in force ("Reduction in Force") with respect to their Canadian-based
employees. This Reduction in Force is part of Enjoy's restructuring efforts. The
Reduction in Force was authorized by Enjoy Canada's board of directors on
June 30, 2022 and involves a reduction of the Company's workforce in the
aggregate of approximately 145 employees, representing approximately 7.8% of the
Company's global workforce as of June 30, 2022. The Company estimates that it
will have 1,707 total employees following the effectiveness of the Reduction in
Force. The Company expects execution of the Reduction in Force to be
substantially complete in the second half of 2022.
In connection with the Reduction in Force, the Company estimates that it will
incur approximately $0.2 million in expenses, all of which are expected to be in
the form of future cash-based expenditures and substantially all of which are
expected to be related to employee severance and other termination benefits. The
Company expects to recognize substantially all of these charges in the second
quarter of 2022. The foregoing estimated amounts do not include any non-cash
charges associated with stock-based compensation. The Company expects to
recognize a stock-based compensation expense related to vested awards and does
not anticipate modifying the affected employees' stock awards to accelerate the
vesting of such awards or to otherwise modify such awards in a manner that would
result in such charges.
Item 8.01 Other Events.
The information set forth in Item 2.05 of this Current Report on Form 8-K is
incorporated into this Item 8.01.
On June 30, 2022, the Company announced that it expects to commence the wind
down of the operations of Enjoy Canada on or about July 4, 2022.
This Current Report on Form 8-K contains forward-looking statements including,
but not limited to, statements related to the expected cost of the Reduction in
Force; the number of positions affected by the Reduction in Force; the time
frame for completion of, and recognition of charges associated with, the
Reduction in Force. These forward-looking statements are based on management's
beliefs and assumptions and on information available to management as of the
date they are made. However, investors should not place undue reliance on any
such forward-looking statements because they speak only as of the date they are
made. The Company does not undertake any obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, except as required by law. In addition, forward-looking
statements are subject to certain risks and uncertainties that could cause
actual results, events and developments to differ materially from the Company's
historical experience and its present expectations. These risks and
uncertainties include other factors described in Enjoy's Quarterly Report on
Form 10-Q for the quarter ended March 31, 2022 filed with the Securities and
Exchange Commission ("SEC") on May 16, 2022 and those described in the Company's
other filings with the SEC.
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