Amended and Restated Non-Statutory Stock Option Award Agreement
Amended
and Restated
April 22,
2008
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President
& CEO
Select
Comfort Corporation
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Re:
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Non-Statutory
Options to Purchase Shares of Common Stock of Select Comfort Corporation
(the “Company”)
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This
letter agreement amends and restates in its entirety the terms of the
non-statutory stock option award granted to you on March 2, 2006. As
of such date (and after giving effect to a 3-for-2 stock split of the Company’s
common stock effected as of June 8, 2006), you were granted non-statutory stock
options under the Company’s 2004 Stock Incentive Plan (the “Plan”) giving you
the right to purchase up to five hundred sixty two thousand five hundred
(562,500) shares of the Company’s common stock at a price of $24.65 per share
(the “Options”), all of which Options were scheduled to become fully
exercisable, or to “vest,” as of March 2, 2011, so long as you remain
continuously employed by the Company and subject to the applicable terms and
conditions of the Plan.
For good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, you and the Company have agreed to extend the vesting date such
that all of the Options will become fully exercisable only as of December 2,
2015, so long as you remain continuously employed by the Company and subject to
earlier vesting only pursuant to the terms applicable upon (i) termination of
your employment due to death or disability or (ii) a change in control of the
Company, as described below.
Your
rights to exercise the Options will terminate as to all unexercised options at
5:00 p.m. (Minneapolis, Minnesota time) on March 1, 2016 (the “Expiration
Date”), subject to earlier termination as described below or in the
Plan.
The
vesting and termination provisions of the Options will be impacted by the
termination of your employment, depending on the reason for termination of your
employment, or by a change in control of the Company, as described
below:
Voluntary Termination or
Retirement. If your employment is terminated voluntarily by
you (whether upon retirement or otherwise), Options that are vested as of the
date of termination of employment will remain exercisable for up to three (3)
months after your employment ends, but not beyond the Expiration
Date.
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Termination by the Company
other than for Cause. If your employment is terminated by the
Company (other than for “cause,” as defined in the Plan), Options that are
vested as of the date of termination of employment will remain exercisable for
up to three (3) months after your employment ends, but not beyond the Expiration
Date.
Termination by the Company
for Cause. If your employment is terminated by the Company for
“cause,” as defined in the Plan, all of your rights under this letter agreement
and the Options will immediately terminate without notice of any
kind.
Termination due to Death or
Disability. If your employment is terminated due to death or
“disability,” as defined in the Plan, all of the Options will become immediately
exercisable in full and will remain exercisable for up to two (2) years after
termination of employment, but not beyond the Expiration Date.
Change in
Control. Pursuant to the standard terms of the Plan, if a
Change in Control of the Company (as defined by the Plan) occurs, then all of
the Options will become immediately exercisable in full and will remain
exercisable until the Expiration Date, regardless of whether you remain in
employment or service with the Company.
The
Company is not required to give you notice of the termination of the Options
under any of the foregoing circumstances.
Following
the exercise by you of the Options, the shares purchased by you will be freely
tradable, subject to the Company’s policies and SEC rules regarding ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇. Executive officers and members of the Board of Directors are
required to comply with SEC Rule 144 in connection with any sale of shares
received upon the exercise of any stock options.
Withholding
Taxes. The Company is entitled to (a) withhold and deduct from
your future wages (or from other amounts that may be due and owing to you from
the Company), or make other arrangements for the collection of all legally
required amounts necessary to satisfy any federal, state or local withholding
and employment-related tax requirements attributable to the exercise of the
Options, or (b) require you to promptly remit the amount of such withholding to
the Company. In the event that the Company is unable to withhold such
amounts, for whatever reason, you agree to pay to the Company an amount equal to
the amount the Company would otherwise be required to withhold under federal,
state or local law.
There may
be income tax consequences resulting from the exercise of the Options or sale of
the shares received upon the exercise of the Options. You are urged
to consult with your individual tax advisor regarding any tax
consequences.
The
Options are granted under the Company’s 2004 Stock Incentive Plan, and are
subject to all of the terms and conditions applicable to stock options granted
under the Plan, except as may be otherwise expressly provided
herein.
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Please
note that your rights to exercise the Options will become void and will expire
as to all unexercised Options at 5:00 p.m. (Minneapolis, Minnesota time) on
March 1, 2016, subject to earlier termination as set forth above or in the
Plan.
Please
indicate your acceptance of the terms and conditions of this Amended and
Restated Non-Statutory Stock Option Award Agreement by signing a copy of this
letter agreement where indicated below.
Very
truly yours,
/s/
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Chair,
Management Development and Compensation Committee
By
signing this letter, I acknowledge the amended and restated terms of the Options
as set forth in this Amended and Restated Non-Statutory Stock Option Award
Agreement.
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