Exhibit 10.24
PLEDGE AGREEMENT
The undersigned ("Pledgor") hereby pledges, assigns and grants to Select Comfort
Corporation, a Minnesota corporation ("Secured Party"), a security interest in
150,000 shares of the common stock, par value $0.01 per share, of Secured Party
represented by certificate number 142 registered in the name of Pledgor, as well
as any and all proceeds thereof (as that term is defined in the Uniform
Commercial Code in effect in the State of Minnesota, as amended from time to
time), whether such proceeds constitute cash or noncash proceeds, including
noncash proceeds of every type and classification whether or not acquired with
cash proceeds (the "Collateral"), in order to secure payment to Secured Party of
any and all amounts due under the terms of that certain Promissory Note of even
date herewith payable by Pledgor to Secured Party in the original principal
amount of $386,546.64 (the "Note").
Pledgor warrants, represents and agrees that:
1. TERM OF THE PLEDGE. The Collateral shall be pledged to Secured Party
pursuant to this Pledge Agreement until payment in full of all obligations of
Pledgor under the Note.
2. COLLATERAL ON DEPOSIT. Throughout the term of this Pledge Agreement, the
Collateral shall remain in the possession of Secured Party, together with a
separate stock power enabling Secured Party to effect a transfer of the
Collateral on the books of the Company.
3. LIENS AND ENCUMBRANCES. Pledgor presently has and will maintain as long as
the Note remains outstanding, absolute title to the Collateral free and clear of
any and all liens and encumbrances. Any and all costs of maintaining the
Collateral free and clear of any encumbrances and security interests which are
prohibited by the terms of this Pledge Agreement and of removing the same, if
they should arise, shall be borne and paid solely by Pledgor.
4. NO RESTRICTIONS. Pledgor has the full power and authority to execute this
Pledge Agreement and to subject the Collateral to the security interest created
hereby. No pledge agreement, financing statement or assignment (reflecting the
grant of a security interest in favor of one other than Secured Party) covering
all or any part of the Collateral is in existence or on file in any public
office; nor is any of the Collateral which is pledged hereunder subject to any
restrictions on distribution, except pursuant to federal and state securities
laws.
5. NO DISPOSITION OF COLLATERAL. Except as otherwise agreed to from time to
time by Pledgor and Secured Party, Pledgor will not sell, transfer, lease, grant
a security interest in or otherwise dispose of any of the Collateral, to any
person, party or entity other than Secured Party, and Pledgor shall pay, when
such sums become due and owing, all taxes and other governmental charges levied
or assessed upon any of the Collateral.
6. EVENTS OF DEFAULT. The occurrence of any of the following shall constitute
an event of default hereunder (an "Event of Default"): (a) the failure on the
part of Pledgor to comply with any material obligation contained herein or in
the Note; or (b) any statement, representation or warranty of Pledgor that is
made herein or at any time furnished in writing to Secured Party is untrue or
misleading in any respect as of the date that such statement, representation or
warranty is made.
7. REMEDIES. If any Event of Default arises, Secured Party may, at its
option, exercise any and all rights and remedies of a secured party under the
Uniform Commercial Code (as then in effect in the State of Minnesota) or any
other applicable law.
8. MISCELLANEOUS. This Pledge Agreement shall be binding upon and inure to
the benefit of Pledgor and Secured Party and their respective heirs,
representatives, successors and assigns. It shall take effect when signed by
Pledgor and delivered to Secured Party, and Pledgor hereby waives notice of
Secured Party's acceptance hereof. This Pledge Agreement shall be governed by
and construed in accordance with the laws of the State of Minnesota and, unless
the context otherwise requires, all of the terms used herein which are defined
in Articles 1 and 9 of the Uniform Commercial Code (as in effect in the State of
Minnesota and as amended from time to time) shall have the meanings stated
therein. If any provision or application of this Pledge Agreement is held by an
appropriate tribunal to be unlawful or unenforceable in any respect, then such
illegality or unenforceability shall not affect any other provision or
application of this Pledge Agreement which may be given effect, and this Pledge
Agreement shall be construed as if the unlawful or unenforceable provision or
application had never been contained herein or prescribed hereby. Any and all
representations and warranties contained in this PledgeAgreement shall survive
the execution and delivery of this Pledge Agreement and shall expire upon
payment of all sums due under the Note.
IN WITNESS WHEREOF, the undersigned has caused this Pledge Agreement to be
executed and delivered effective as of February 20, 1997.
/S/
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Xxxx X. xx Xxxxx
STOCK POWER
FOR VALUE RECEIVED, Xxxx X. Xx Xxxxx, hereby sells, assigns and transfers unto
Select Comfort Corporation (the "Company"), One Hundred Fifty Thousand (150,000)
shares of the Common Stock of the Company standing in his name on the books of
the Company represented by Certificate No. 142, and does hereby irrevocably
constitute and appoint the Secretary of the Company as attorney-in-fact to
transfer such shares on the books of the Company with full power of substitution
in the premises.
Dated February 20, 1997
/s/
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Xxxx X. xx Xxxxx
In Presence of
/s/
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