Exhibit
10.34


 


Form
of Restricted Stock Award Agreement


under
the


Select
Comfort Corporation 2004 Stock Incentive Plan


 


RESTRICTED STOCK AWARD AGREEMENT


 


THIS AGREEMENT is entered
into and effective as of this         
day of                               ,
20     (the “Date of Grant”), by and between Select Comfort
Corporation (the “Company”) and                               
(the “Grantee”).


 


A.                                   The Company has adopted the Select
Comfort Corporation 2004 Stock Incentive Plan (the “Plan”) authorizing the grant
of Restricted Stock Awards to employees and non-employee directors, consultants
and independent contractors of the Company and its Subsidiaries (as defined in
the Plan).


 


B.                                     The Company desires to give the Grantee a
proprietary interest in the Company and an added incentive to advance the
interests of the Company by granting to the Grantee a Restricted Stock Award
pursuant to the Plan.


 


Accordingly, the parties
agree as follows:


 


1.                                       Grant of Award.


 


The Company hereby grants
to the Grantee a Restricted Stock Award (the “Award”) consisting of                                          
(                              )
shares (the “Award Shares”) of the Company’s common stock, par value $0.01 per
share (the “Common Stock”), subject to the terms, conditions and restrictions
set forth below and in the Plan. 
Reference to the Award Shares in this Agreement will be deemed to
include the Dividend Proceeds (as defined in Section 3.3 of this
Agreement) with respect to such Award Shares that are retained and held by the
Company as provided in Section 3.3 of this Agreement.


 


2.                                       Grant Restriction.


 


2.1                                 Restriction and Forfeiture. 
The Grantee’s right to retain the Award Shares will be subject to the
Grantee remaining in the continuous employ or service of the Company or any
Subsidiary for a period of four (4) years (the “Restriction Period”) following
the Date of Grant; provided, however, that such employment/service period
restrictions (the “Restrictions”) will lapse and terminate prior to end of the
Restriction Period as set forth in Sections 2.2 and 2.3 below.


 


2.2                                 Termination of Employment or Other
Service.


 


(a)                                  Termination Due to Death or Disability. 
In the event that the Grantee’s employment or other service with the
Company and all Subsidiaries is terminated by reason of the Grantee’s death or
Disability (as defined in the Plan), the Restrictions applicable to the Award
Shares will immediately lapse and terminate.


 





















 


(b)                                 Termination Due to Retirement. 
In the event that the Grantee’s employment or other service with the
Company and all Subsidiaries is terminated by reason of the Grantee’s
Retirement (as defined in the Plan), the Restrictions applicable to the Award
Shares will immediately lapse and terminate with respect to a pro rata portion
of the Award Shares on the basis of the portion of the Restriction Period that
has passed as of the date of the Retirement.


 


(c)                                  Termination for Reasons other than Death,
Disability or Retirement.  In the event the Grantee’s
employment or other service with the Company and all Subsidiaries is terminated
for any reason other than death, Disability or Retirement, or the Grantee is in
the employ or service of a Subsidiary and the Subsidiary ceases to be a
Subsidiary of the Company (unless the Grantee continues in the employ or service
of the Company or another Subsidiary), all rights of the Grantee under the Plan
and this Agreement will terminate immediately without notice of any kind, and
this Award will be terminated and all Award Shares with respect to which the
Restrictions have not lapsed will be forfeited.


 


2.3                                 Change in Control.  If
a Change in Control (as defined in the Plan) of the Company occurs, the
Restrictions applicable to the Award Shares will immediately lapse and
terminate.


 


3.                                       Issuance of Award Shares.


 


3.1                                 Privileges of a Shareholder;
Transferability.  As soon as practicable after the execution
and delivery of this Agreement and the satisfaction of any conditions to the
effective issuance of such Award Shares, the Grantee will be recorded on the
books of the Company as the owner of the Award Shares, and the Company will
issue one or more duly issued and executed stock certificates evidencing the
Award Shares.  Except as otherwise
expressly provided in this Agreement, the Grantee will have all voting,
dividend, liquidation and other rights with respect to the Award Shares in
accordance with their terms upon becoming the holder of record of such Award
Shares; provided, however, that prior to the lapse or other termination of the
Restrictions applicable to Award Shares, such Award Shares will not be
assignable or transferable by the Grantee, either voluntarily or involuntarily,
and may not be subjected to any lien, directly or indirectly, by operation of
law or otherwise.  Any attempt to
transfer, assign or encumber the Award Shares other than in accordance with
this Agreement and the Plan will be null and void and will void the Award, and
all Award Shares for which the Restrictions have not lapsed will be forfeited
and immediately returned to the Company.


 


3.2                                 Enforcement of Restrictions. 
To enforce the Restrictions imposed by this Agreement and the Plan, the
Company may place a legend on the stock certificates referring to the
Restrictions and may require the Grantee, until the Restrictions have lapsed
with respect to Award Shares, to keep the stock certificates evidencing such
Award Shares, together with duly endorsed stock powers, in the custody of the
Company or its transfer agent or to maintain evidence of stock ownership of
such Award Shares, together with duly endorsed stock powers, in a
certificateless book-entry stock account with the Company’s transfer agent.


 


3.3                                 Dividends and Other Distributions. 
Unless the Compensation Committee of the Board of Directors (the “Committee”)
determines otherwise in its sole discretion (including, without limitation, at
any time after the grant of the Restricted Stock Award), any dividends or
distributions (including, without limitation, any cash dividends, stock
dividends or dividends in kind, the proceeds of any stock split or the proceeds
resulting from any changes or exchanges


 


2





















 


described in Section 6
of this Agreement, all of which are referred to herein collectively as the “Dividend
Proceeds”) that are paid or payable with respect to shares of Common Stock
subject to the unvested portion of a Restricted Stock Award will be subject to
the same rights and restrictions under this Agreement as the shares to which
such dividends or distributions relate. 
The Committee may, in its sole discretion, distribute such Dividend
Proceeds to the Grantee or it may retain and hold such Dividend Proceeds
subject to the Restrictions and the other terms and conditions of this
Agreement.  In the event the Committee
determines not to pay such Dividend Proceeds currently, the Committee will
determine in its sole discretion whether any interest will be paid on such
Dividend Proceeds.  In addition, the
Committee in its sole discretion may require such Dividend Proceeds to be
reinvested (and in such case the Committee may require the Participant’s
consent to such reinvestment) in shares of Common Stock that will be subject to
the same restrictions as the shares to which such Dividend Proceeds
relate.  In addition, the Committee may,
in its sole discretion, cause such Dividend Proceeds to be paid to the Company
pursuant to Section 5 of this Agreement in order to satisfy any federal,
state or local withholding or other employment-related tax requirements
attributable to such dividends or distributions or to the Grantee’s receipt of
the Award or the lapse or termination of the Restrictions applicable to Award
Shares.


 


4.                                       Rights of Grantee.


 


4.1                                 Employment or Service. 
Nothing in this Agreement will interfere with or limit in any way the
right of the Company or any Subsidiary to terminate the employment or service
of the Grantee at any time, nor confer upon the Grantee any right to continue
in the employ or service of the Company or any Subsidiary at any particular
position or rate of pay or for any particular period of time.


 


4.2                                 Rights as a Shareholder. 
The Grantee will have no rights as a shareholder until the Grantee
becomes the holder of record of such Award Shares, and no adjustment will be
made for dividends or distributions with respect to the Award Shares as to
which there is a record date preceding the date the Grantee becomes the holder
of record of the Award Shares, except as may otherwise be provided in the Plan
or determined by the Committee in its sole discretion.


 


5.                                       Withholding Taxes.


 


The Company is entitled
to (a) withhold and deduct from future wages of the Grantee (or from other
amounts that may be due and owing to the Grantee from the Company), or cause to
be paid to the Company out of Dividend Proceeds, 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 receipt of the Award, the receipt of dividends or
distributions on Award Shares, or the lapse or termination of the Restrictions
applicable to Award Shares, or (b) require the Grantee promptly to remit the
amount of such withholding to the Company. 
In the event that the Company is unable to withhold such amounts, for
whatever reason, the Grantee agrees 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.


 


6.                                       Adjustments.


 


In the event of any
reorganization, merger, consolidation, recapitalization, liquidation,
reclassification, stock dividend, stock split, combination of shares, rights
offering or divestiture


 


3





















 


(including a
spin-off) or any other change in the corporate structure or shares of the
Company, the Committee (or, if the Company is not the surviving corporation in
any such transaction, the board of directors of the surviving corporation), in
order to prevent dilution or enlargement of the rights of the Grantee, will
make appropriate adjustment (which determination will be conclusive) as to the
number and kind of securities or other property (including cash) subject to
this Award.


 


7.                                       Subject to Plan.


 


The Award and the Award
Shares granted pursuant to this Agreement have been granted under, and are
subject to the terms of, the Plan.  Terms
of the Plan are incorporated by reference in this Agreement in their entirety,
and the Grantee, by execution hereof, acknowledges having received a copy of
the Plan.  The provisions of this
Agreement will be interpreted as to be consistent with the Plan, and any
ambiguities in this Agreement will be interpreted by reference to the
Plan.  In the event that any provision of
this Agreement is inconsistent with the terms of the Plan, the terms of the
Plan will prevail.


 


8.                                       Miscellaneous.


 


8.1                                 Binding Effect. 
This Agreement will be binding upon the heirs, executors, administrators
and successors of the parties to this Agreement.


 


8.2                                 Governing Law. 
This Agreement and all rights and obligations under this Agreement will
be construed in accordance with the Plan and governed by the laws of the State
of Minnesota, without regard to conflicts of laws provisions.  Any legal proceeding related to this
Agreement will be brought in an appropriate Minnesota court, and the parties to
this Agreement consent to the exclusive jurisdiction of the court for this
purpose.


 


8.3                                 Entire Agreement. 
This Agreement and the Plan set forth the entire agreement and
understanding of the parties to this Agreement with respect to the grant and
vesting of this Award and the administration of the Plan and supersede all
prior agreements, arrangements, plans and understandings relating to the grant
and vesting of this Award and the administration of the Plan.


 


8.4                                 Amendment and Waiver. 
Other than as provided in the Plan, this Agreement may be amended,
waived, modified or canceled only by a written instrument executed by the
parties to this Agreement or, in the case of a waiver, by the party waiving
compliance.


 


4





















 


The parties hereto have
executed this Agreement effective the day and year first above written.


 


	
   

  	
  SELECT COMFORT CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By execution of this Agreement,

  	
  GRANTEE

  
	
  the Grantee acknowledges having

  	
   

  	
   

  
	
  received a copy of the Plan.

  	
   

  	
   

  
	
   

  	
   

  	
         (Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (Name and Address)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
					



 


5