PROTOCOL SYSTEMS, INC.

                    RESTRICTED STOCK AWARD AGREEMENT


TO:      David F. Bolender                      Date of Grant: April 3, 1998

         We are pleased to inform you that you have been selected by the Board 
of Directors (the "Board") of Protocol Systems, Inc. (the "Company") to 
receive a Restricted Stock Award (the "Award") of 20,000 shares of the 
Company's $.01 par value common stock ("Shares").  This Award is subject to 
the following terms and conditions.

1.      VESTING:  The Shares will vest and become deliverable to you according 
to the following schedule:

Date On and After Which Shares Vest           Number of Shares Vested
-----------------------------------          ------------------------
       April 3, 1998                               5,000 shares
       July 3, 1998                                5,000 shares
       October 3, 1998                             5,000 shares
       January 3, 1999                             5,000 shares 

2.     WITHHOLDING TAXES:  As a condition to the delivery of the Shares, you 
must make such arrangements as the Company may require for the satisfaction of 
any federal, state or local withholding tax obligations that may arise in 
connection with issuance and delivery of the Shares.  

3.     TERMINATION:  If your relationship with the Company ceases because your 
employment with the Company terminates for any reason, including death or 
disability, then, notwithstanding the vesting schedule set forth above, you 
will be entitled to receive a number of Shares that is equal to the same 
percentage of the Shares that would vest on the next vesting date as the 
number of days you were employed during that vesting period divided by the 
number of days in the vesting period.

4.     TRANSFERABILITY OF AWARD:  This Award and the rights and privileges 
conferred hereby may not be transferred, assigned, pledged or hypothecated in 
any manner (whether by operation of law or otherwise) other than by will or by 
the applicable laws of descent and distribution and shall not be subject to 
execution, attachment or similar process.  Any attempt to transfer, assign, 
pledge, hypothecate or otherwise dispose of this Award or of any right or 
privilege conferred hereby, contrary to the provisions hereof, or the sale or 
levy or any attachment or similar process upon the rights and privileges 
conferred hereby will be null and void. Notwithstanding the foregoing, to the 
extent permitted by applicable law and regulation, the Company, in its sole 
discretion, may permit you to transfer this Award and the rights and 
privileges conferred hereby.

5.     CONTINUATION OF RELATIONSHIP:  Nothing in this Award will confer upon 
you any right to continue in the employ or other relationship of the Company, 
or to interfere in any way with the right of the Company to terminate your 
employment or other relationship with the Company at any time.

6.     DETERMINATION OF BOARD TO BE FINAL:  All determinations referred to 
herein will be made by the Board, and such determinations will be final, 
binding and conclusive.

7.     INVESTMENT INTENT:  You represent and warrant to the Company that you 
are acquiring the Shares for your own account and investment and not with a 
view to, or for sale in connection with, any distribution.

8.     RESTRICTED SECURITIES; LEGEND:  You understand that the Shares have not 
been registered under the Securities Act of 1933 in reliance upon an exemption 
from registration.  Such exemption depends upon, among other things, the bona 
fide nature of your investment intent stated in this Agreement.  You under-
stand that the Shares must be held indefinitely, unless the Shares 
subsequently are registered under the Securities Act of 1933 or unless an 
exemption from registration is otherwise available.  You understand that the 
Company is not obligated to register the Shares.  You agree that the Shares 
may not be offered, sold, transferred, pledged, or otherwise disposed of in 
the absence of an effective registration statement under the Securities Act of 
1933 and applicable state securities laws or an opinion of counsel acceptable 
to the Company that such registration is not required.  You understand that 
the certificate(s) representing the Shares will be imprinted with 
substantially the following legend:

       THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED 
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR APPLICABLE STATE 
SECURITIES LAWS.  THE SHARES HAVE BEEN ACQUIRED WITHOUT A VIEW TO DISTRIBUTION 
AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE 
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT 
AND UNDER ANY APPLICABLE SECURITIES LAWS, OR AN OPINION OF COUNSEL FOR THE 
HOLDER (CONCURRED IN BY LEGAL COUNSEL FOR THE CORPORATION) THAT SUCH REGISTRA-
TION IS NOT REQUIRED AS TO SUCH SALE OR OFFER.  THE STOCK TRANSFER AGENT HAS 
BEEN ORDERED TO EFFECTUATE TRANSFERS OF THIS CERTIFICATE ONLY IN ACCORDANCE 
WITH THE ABOVE INSTRUCTION.

9.     COMPENSATION CLAIM:  You understand and agree that this Award is made 
in lieu of the payment of cash compensation to you, and you agree that all of 
the Shares issued and delivered to you pursuant to this Agreement will be 
forfeited to the Company in the event that you make any legal claim for cash 
compensation for work performed during the vesting periods set forth above.

       Please execute the Agreement in the space below and return it to the 
undersigned.


                                    Very truly yours,

                                    PROTOCOL SYSTEMS, INC.


                                    By:
                                       ------------------------------

AGREED AND ACCEPTED:


------------------------
David F. Bolender


------------------------
Date
 

 
 

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