Sample Business Contracts

Master Agreement - Select Comfort Corp. and Gumotex Co.

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                                MASTER AGREEMENT

This Master Agreement, made and entered into this, by and between Select Comfort
Corporation, a corporation organized and existing under the laws of the state of
Minnesota, hereinafter referred to as "Buyer" and XXXXXX, organized under the
laws of XXXXXXXX, hereinafter referred to as "Seller".

[Portions of this recital have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended. A copy of this Exhibit with this recital intact has been filed
separately with the Securities and Exchange Commission.]


         WHEREAS, Buyer is a user of the goods hereinafter described and desires
to establish a formal relationship for the purchase from Seller of such goods;

         WHEREAS, Seller is the manufacturer and supplier of such goods and is
willing to provide and sell them to Buyer, all upon the terms and conditions
hereinafter stated.

         NOW, THEREFORE, in consideration of the mutual promises and covenants
herein set forth, the parties hereby agree as follows:

                                   ARTICLE 1.

For purposes of this Agreement, the following terms, word and phrases, where
written with an initial capital letter, shall have the following meanings:

1.1      "Products" shall mean the air chambers manufactured by Seller according
         to the Master Specification Exhibit III attached;

1.2      "Improvements" shall mean modifications and/or enhancements to the
         design of products owned by Buyer, developed by either party during the
         term of this Agreement as per the Master Specification Exhibit III


                                   ARTICLE 2.
                               SUPPLY AND PURCHASE

2.1      During the term of this Agreement, Buyer agrees to purchase from
         Seller, and Seller agrees to supply to Buyer, at the prices determined
         in accordance herewith, and subject to the terms and conditions
         hereinafter set forth, the annual minimum volumes of Products set forth
         in Exhibit IV as defined by Exhibit III, Master Specification attached
         hereto from Seller.

2.2      Seller agrees that all air chamber "Products", as specified in Exhibit
         III, shall be delivered exclusively to Buyer or a company designated by
         the Buyer. All inquiries that Seller receives on a worldwide basis
         relative to Buyer's air chamber "Products" as specified in Exhibit III,
         shall be directed to Buyer.

                                   ARTICLE 3.

3.1      Purchase Orders. Buyer shall submit purchase orders for the Products a
         minimum of 14 days prior to the requested delivery date. The delivery
         date is the date the order is expected to leave the factory en-route to
         the FOB point. Seller shall advise within 2 business days of receipt of
         the order if they are unable to fulfill the order as requested. All
         purchase orders shall be mutually executed in accordance with the terms
         and conditions of this Agreement and at the prices established herein.

3.2      Delivery of Products. Seller shall deliver the Products within the
         times specified on the individual purchase orders, in the quantities
         specified on the individual purchase orders and at the prices specified
         herein, all in accordance with Buyer's instructions and Master
         Specifications (Exhibit III). Buyer reserves the right to adjust the
         mix of the product with a minimum of 14 days notice from the requested
         delivery date.

3.3      Stock outs: Buyer shall reserve the right to assert claims for actual
         costs incurred due to the Seller's failure to deliver the product
         against a confirmed purchase order on the confirmed ship date. All
         claims shall be submitted in writing to the Seller and accompanied with
         supporting documentation. Seller may reserve the right to have the
         claim audited by an independent 3rd party. This claim shall include,
         but not be limited to, the following costs: expedited freight, in-bound
         and out-bound, sales lost due to Buyer's inability to meet the 7-10 day
         delivery commitment to our Customers, or any additional handling or
         overtime costs incurred as a result of the late delivery.

3.4      Shipping Terms. The initial shipping term for Products delivered by
         Seller to Buyer pursuant to this agreement shall be the shipping term
         set forth in Exhibit I. Such shipping term may be changed by the
         parties upon mutual agreement in writing at any time during the term of
         this agreement. The shipping terms stipulated by the Parties shall be
         interpreted in accordance with the terms of the Incoterm '90 defined by
         the International Chamber of Commerce. In the event of a change in the
         shipping term, the parties shall adjust the prices for Products set
         forth in Exhibit I to reflect the changed shipping term.


3.5      Packaging and shipping will be done according to the Master
         Specification (Exhibit III) and Buyers instructions that will be in
         conformity with the other paragraphs of the Agreement.

                                   ARTICLE 4.
                               QUALITY OF PRODUCTS

The quality of all Products delivered by Seller shall be in accordance with the
Quality Requirements and Acceptance Criteria, Exhibit II.

                                   ARTICLE 5.

The parties agree to cooperate in value engineering and product development
efforts relating to quality improvement and cost reduction of the Products. Such
efforts shall take the form and extent as mutually agreed to by the parties in
writing. A cost sharing formula for any savings achieved by these efforts shall
be mutually determined and the unit pricing established under Exhibit I shall be
revised accordingly to reflect such savings. It is Buyer's expectation that the
Seller take a lead role in investigating and presenting new material and process
improvements in the air chamber technology.

                                   ARTICLE 6.
                               PRICES AND PAYMENT

Prices and Adjustments. The pricing to be paid by the Buyer for the Products
purchased hereunder shall be the prices set forth in Exhibit I attached hereto.
In addition to any changes to such prices pursuant to Paragraph 3.4, such prices
may be subject to adjustments as agreed to by the parities. A minimum of 60 days
written notice is required prior to the effective date of the requested price
adjustment. The adjusted price shall be guaranteed for a minimum of 6 (six)
months from the effective date of the price adjustment. Such adjusted prices
shall be substituted for the prices set forth in Exhibit I, and a new Exhibit I,
as so modified shall be attached to this Agreement.

6.1      Payment Terms. Payment for delivered Products shall be made via a wire
         transfer by Buyer in United States Dollars thirty (30) days from the
         date of the Bill of Lading for Products ordered and delivered. Such
         payment terms may be changed by the parties upon mutual agreement in
         writing at any time during the term of this agreement.


6.2      Late Payments. If the Buyer is in delay of payment to the Seller,
         Seller reserves the right to assert a claim to the buyer for interest
         incurred at the rate of 0.05% per day for each day payment is delayed
         beyond the original due date of the invoice.
6.2.1    In the event that payment is delayed beyond 30 days from the original
         due date of the invoice, Supplier reserves the right to withhold
         confirmed shipments to the Buyer until payment for outstanding invoices
         is received by the Seller.

                                   ARTICLE 7.

         Except as otherwise provided in this Agreement Seller shall be
         responsible for and shall pay any and all (a) export duties, (b) gross
         receipt, income and pre-sale taxes and (c) other governmental charges
         which relate to the production, delivery and sale of the Products, as
         such are now or may hereafter be imposed under or by any state, local
         or municipal governmental authority or agency in the XXXXXXXXX. Seller
         shall not be responsible and shall not pay any taxes or charges as
         outlined in above levied after delivery to Buyer.

         [A portion of this Article has been omitted pursuant to a request for
         confidential treatment under Rule 24b-2 of the Securities Exchange Act
         of 1934, as amended. A copy of this Exhibit with this Article intact
         has been filed separately with the Securities and Exchange Commission.]

                                   ARTICLE 8.
                             ACCEPTANCE AND WARRANTY

8.   Buyer shall accept all Product that meets the Select Comforts Air Chamber,
     Rubber/Cotton Vulcanized, Test and Inspection Specification SP-004,
     conducted at the Seller site prior to shipment to Buyer. Buyer may forego
     inspection at the point of receipt or in-coming and/or in-process quality
     acceptance tests at the time the products are being prepared for shipment
     to Buyer's customers at its principal place(s) of business in Minneapolis,
     Minnesota; Irmo, South Carolina; and, Salt Lake City, Utah. Buyer and
     Seller shall agree to a quality discount percentage that will be applied to
     invoices at the time the Product ships from the Seller to Buyer. This
     quality discount XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX The quality discount
     will be reviewed at least every XXXX and adjusted based on the last XXXXXX
     activity. A review of the quality discount will be warranted prior to
     XXXXXXX in the event the quality discount average varies more than XXXXX
     from the established quality discount over any XXXXXXX period. In the event
     of a change in the quality discount, Exhibit II will be updated to reflect
     the revised quality discount.

[Portions of this Exhibit have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended. A


copy of this Exhibit with the portions intact has been filed separately with the
Securities and Exchange Commission.] 9.

         8.1.1.   Seller warrants to the Buyer from the date of delivery of the
                  Products to the Buyer in accordance with Section 3.2 of this
                  Agreement that all Products sold hereunder shall (i) be free
                  from any defects in material or workmanship and be of good and
                  merchantable quality, (ii) conform to Buyer's specifications
                  to any sample or prototype approved by Buyer and (iii) comply
                  and have been produced, processed and delivered in conformity
                  with Article 4 herein for the period defined in the warranty
                  schedule contained in Exhibit II, Quality Requirements and

         8.1.2.   The foregoing warranties shall survive inspection of, delivery
                  of and payment for the Products and shall run in favor of
                  Buyer and its customers. If Seller breaches any of the
                  foregoing warranties during the term of the warranty period
                  specified in Exhibit II, or if Seller fails to perform or
                  comply with any provision of this Agreement, Seller shall be
                  liable to Buyer for any and all costs, expenses (including
                  reasonable attorneys' fees, court costs and litigation
                  expenses) and damages arising therefrom.

                                   ARTICLE 9.
                               PROPRIETARY RIGHTS

9.1   Buyer retains all proprietary rights in and to all designs of the air
      chambers, as specified in the Master Specification, Exhibit III. The
      Seller agrees to continuously undertake efforts concerning the quality
      improvements of the Products taking into consideration the market
      requirements and the economical production.

9.2   The Seller agrees to continue to make process and development improvements
      to the product according to special requests made by Buyer. Such
      improvements are made for consideration on basis of mutual written
      agreements of the parties. The costs of these development activities are
      to be borne as agreed upon in writing by both parties prior to the actual
      development activities.

9.3   Seller retains all proprietary rights in and to all engineering details
      and other data pertaining to its manufacturing technology and processes.

                                   ARTICLE 10.

Nothing contained in the Agreement will be deemed to grant either party any
right or interest in the trademarks, trade name, service marks, proprietary
words, or symbols which the other may have adopted or used at any time in the
course of its business.


                                   ARTICLE 11.

Each party agrees that all information disclosed to it or any of its affiliates
by other, whether verbally or in writing, shall be presumed to be proprietary
and confidential to such party, unless otherwise stated in writing. Each party
shall prevent the disclosure of any such proprietary information in strictest
confidence absent service of compulsory process. Each party shall not during the
term of this Agreement or thereafter, use any such proprietary information for
any purpose other than as specifically set forth in the Agreement.

                                   ARTICLE 12.
                             COMPETITIVE ACTIVITIES

During the term of this Agreement, Seller will not participate in the management
or operations of any enterprise engaged in activities in competition with the
business of Buyer.

                                   ARTICLE 13.
                              TERM AND TERMINATION

13.1     Term of Agreement. This agreement shall take effect as of the date
         hereof and shall continue in full force and effect for a period of (4)
         years and thereafter shall be automatically renewed for successive
         terms or (1) one year each. Either party may provide written notice to
         the other party at least 365 days prior to the expiration of the
         initial term or any renewal term of its desire not to renew this
         Agreement upon the expiration of the relevant term.

13.2     Termination. This Agreement may be terminated only in accordance with
         the following provisions:

         13.2.1   This Agreement may be terminated at any time upon the mutual
                  written consent of the parties hereto;

         13.2.2   Either party hereto may terminate this Agreement by giving
                  notice in writing to the other party in the event that the
                  other party is in material breach of this Agreement and shall
                  have failed to cure such breach within (30) thirty days of
                  receipt of written notice thereof from the first party
                  specifying the nature of the breach; or

         13.2.3   Either party hereto may terminate this Agreement at any time
                  by giving notice in writing to the other party, if (1) the
                  other party at any time (i) file or have filed against it a
                  petition of any type as to its bankruptcy, (ii) be adjudged
                  bankrupt or insolvent, (iii) make and assignment for the
                  benefit of its creditors, or (iv) go into liquidation
                  receivership; (2) a trustee, receiver or other equivalent
                  officer is appointed for the other party by any


                  court or governmental authority or any third party to
                  administrator or liquidate, who is not dismissed within (60)
                  sixty days of the date of appointment; or (3) dissolution
                  proceedings are commenced by or against the other party, which
                  are not dismissed within (60) sixty days of commencement.

         13.2.4   This Agreement may be terminated by Buyer or Seller with a
                  minimum of (365) three hundred sixty five days written notice
                  if either party discontinues using the Products in its

13.3     Rights and Obligations on Termination. In the event of the termination
         of this agreement, the parties hereto shall have the following rights
         and obligations:

         13.3.1   The obligations of Seller and Buyer under the terms of
                  Sections 4, 7, 8, 9, 10 and 11 hereof shall survive the
                  termination of this Agreement.

         13.3.2   Within (20) twenty days after the termination of this
                  Agreement, each party shall either return to the other any and
                  all proprietary or provide a written certification of
                  destruction of such confidential information in its possession
                  or under its control.

         13.3.3   Termination or expiration of this Agreement shall not
                  release either party from the obligation to make payment to
                  the other party of all amounts then and thereafter due payable
                  under this Agreement within (30) thirty days of termination.

                                   ARTICLE 14.
                                  FORCE MAJEURE

14.1      Definition. Force Majeure shall mean any event or condition, not
         existing as of the date of signature of this Agreement, not reasonably
         foreseeable as of such date and not reasonably within the control of
         either party, which prevents in whole or in material part the
         performance of such obligations so difficult or costly as to make such
         performance commercially unreasonable. Without limiting the foregoing,
         the following shall constitute events or conditions of Force Majeure:
         acts of State or, governmental action, riots, disturbance, war,
         strikes, lockouts, slowdowns, prolonged shortage of energy supplies,
         epidemics, fire, flood, hurricane, typhoon, earthquake, lightning and

14.2     Notice. Upon giving notice to the other party, a party affected by an
         event of Force Majeure shall be released without any liability on its
         part from the performance of its obligations under this Agreement,
         except for the obligation to pay any amounts due and owing hereunder,
         but only to the extent and only for the period that its performance of
         such obligations is prevented by the event of Force Majeure. Such
         notice shall include a description of the nature of the event of Force
         Majeure, its cause and possible consequences. The party claiming Force
         Majeure shall promptly notify the other party to the terminations of
         such event.

14.3     Suspension of Performance. During the period that the performance by
         one of the parties of its obligations under this Agreement has been
         suspended by reason of an event of Force


         Majeure, the other party may likewise suspend the performance of all or
         part of its obligations hereunder.

                                   ARTICLE 15.
                           DISPUTES AND GOVERNING LAW

15.1     Disputes. The parties hereto shall submit any disputes arising under
         this Agreement to arbitration. Such arbitration proceedings shall be
         conducted in English and shall be carried on in the city of Vienna,
         Austria or any other place mutually agreeable to the Parties, under the
         UNCITRAL Arbitration Rules. Judgement upon the award rendered by the
         arbitrator in favor of the prevailing party, which shall include an
         award for the payment of costs, attorneys' fees and expenses of the
         arbitration proceedings, may be entered in any court of competent
         jurisdiction and assets may be attached in any country in the world
         pursuant to such judgement.

                                   ARTICLE 16.
                          GENERAL TERMS AND CONDITIONS

16.1     Relationship. This Agreement does not make either party hereto the
         employee, agent or legal representative of the other party for any
         purpose whatsoever. Neither party hereto is granted any right or
         authority to assume or to create any obligation or responsibility,
         expressed or implied, on behalf of or in the name of the other party.
         In fulfilling its obligations pursuant to the Agreement, each party
         hereto shall act as an independent contractor.

16.2     Assignment. Each party shall not assign or otherwise transfer any of
         its rights or obligations under this Agreement without the prior
         written consent of the other party. This Agreement and the rights and
         obligation arising hereunder shall not be affected by any change in the
         corporate structure of ownership of the parties.

16.3     Notices. All notices permitted or required to be given hereunder shall
         be delivered personally or sent by telecopy or registered or certified
         air mail, postage prepaid, return receipt requested, addressed to the
         addresses of the parties hereto as set forth above or to such other
         addresses as the given parties may designate by like notice from time
         to time. Notices so given shall be effective (a) upon the date of
         personal delivery, (b) if sent by telecopy, concurrently with the
         transmission thereof if the sender's machine produces a transmission
         report without notice of a communication fault, (c) on the (3rd) third
         business day following the date on which such notice is mailed by
         registered or certified air mail.


16.4     Entire Agreement. This Agreement, including the Exhibits attached
         hereto and by this reference made an integral part hereof, constitute
         the entire agreement of the parties hereto with respect to the subject
         matter hereof and thereof, and supersede all previous proposals, verbal
         or written, expressed or implied, and all negotiations, conversations
         or discussions heretofore between the parties hereto related to the
         subject matter of this Agreement.

16.5     Amendment. This Agreement shall not be deemed or construed to be
         modified, amended, rescinded, canceled or waived, in whole or in part,
         except by written statement signed by both parties hereto.

16.6     Severability. In the event that any of the terms of this Agreement are
         in conflict with any rule of law or statutory provision or otherwise
         unenforceable under the laws or regulations of any government or
         subdivision thereof, such terms shall be deemed stricken from this
         Agreement, but such invalidity or unenforceability of any such
         provisions hereof does substantial violence to, or where the invalid or
         unenforceable provisions comprise an integral part of, or otherwise
         inseparable from, the remainder of this Agreement.

16.7     Compliance with Applicable Laws. The parties to this Agreement shall at
         all times conduct their activities hereunder in accordance with all
         applicable federal, state and local laws, rules and governmental

16.8     Waiver. No failure by either party hereto to take any action or assert
         any right hereunder shall be deemed to be a waiver of such right in the
         event of the continuation or repetition of the circumstances giving
         rise to such right.

16.9     Counterparts. This Agreement may be executed in (2) two or more
         counterparts in the English language, each of which shall be deemed an
         original, but all of which shall constitute (1) one and the same

16.10    Remedies Cumulative. Each of the right and remedies of the parties set
         forth in this Agreement shall be cumulative with all other rights and
         remedies, as well as with all rights and remedies of the partied hereto
         otherwise available at law or in equity.

16.11    Indemnification. Each party shall indemnify the other and hold it
         harmless from and against any and all costs including reasonable
         attorneys' fees, court costs and litigation expenses, losses, expenses
         and damages incurred by the other party in connection with any claim or
         cause of action brought by any third person or part against it which,
         in whole or in part is based upon or arises out of any breach of any of
         its obligations hereunder.


16.12    Captions. The captions of Articles and Sections of this Agreement are
         included for convenient reference only, shall not be construed as part
         of this Agreement and shall not be used to define, limit, extend or
         interpret the terms hereof.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
on the day and year first written above.


By /s/ Kathleen Graber                By /s/ Ing. Jiri Kaluzik
                       --------------                           --------------

Title VP Supply Chain Mgmt            Title Managing Director
                       --------------                           --------------

Date:10/18/02                         Date:10/22/02
                       --------------                           --------------

Product Part Number, Description and Pricing Structure

The following prices shall be in effect from January 2002 through December 2002
and shall only be amended in accordance with the provisions of Article 6.1,
Prices and payments. The baseline exchange rate used to determine the pricing is
$1.00 USD equals XXXX.

       ITEM NUMBER        DESCRIPTION                COST / EA.
         100133           Mini Display                 $xxxx
         100270           Twin                         $xxxx
         100271           Full                         $xxxx
         100272           Queen Single                 $xxxx
         100273           Queen Dual                   $xxxx
         100274           E-King                       $xxxx
         100275           C-King                       $xxxx
         100276           TXL                          $xxxx
         100277           Super Single                 $xxxx
         100278           Super Queen                  $xxxx
         100279           Super King                   $xxxx


       ITEM NUMBER        DESCRIPTION                COST / EA.

         100281           Euro                         $xxxx
         105757           Expanded Queen               $xxxx
         105758           Flawed Twin                  $xxxx
         105759           Flawed Full                  $xxxx
         105760           Flawed Queen Dual            $xxxx
         105761           Flawed E-King                $xxxx

[Portions of this Exhibit I have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended. A copy of this Exhibit with the portions intact has been filed
separately with the Securities and Exchange Commission.]


o        FOB German - Bremerhaven or Hamburg Ocean Port, full 20' or 40'
         container delivered


Each January 1st, for the years 2003 - 2005 Exhibit I will be updated to reflect
the respective annual price reduction. In addition to the annual XXX reduction,
there will be an annual rebate program based on the following volume:
         400,001 - 500,000 air chambers per year (Jan 1 - Dec 31) XXX
         500,001 +         air chambers per year (Jan 1 - Dec 31) XXX

[Portions of this Exhibit have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended. A copy of this Exhibit with the portions intact has been filed
separately with the Securities and Exchange Commission.]

These rebates will be calculated only on the air chambers shipped within the
calendar year, which exceed the volumes represented above. Eligible rebates will
be applied to the invoice at the point of shipment on the chambers that exceed
the volumes represented above.


Quality Requirements and Acceptance Criteria

The Buyers engineering specifications and engineering drawing requirements take
precedence over other requirements communicated to the Seller, whether such
requirements are verbal or written, except where a Deviation From Specification
(DFS) is approved and issued to the Seller by the Buyer.


The Seller shall review pre-production, prototype, first-piece, sample, or other
initial part or product, with the Buyer. This review shall include
representative samples, process data, and inspection and test data, for the
purpose of determining if the part or product meets the Buyers engineering
specifications and engineering drawing requirements, as well as safety and other
regulatory requirements specific to the part or product supplied.

Either Seller or Buyer may initiate a DFS where there is a realized need to
depart from requirements documented within the Buyers engineering specifications
or engineering drawings.

The Seller shall review known part or product deficiencies with the Buyer prior
to shipping the part or product to the Buyer. In some instances, Buyer may
approve a DFS to allow the Seller to produce deficient parts or products for a
limited period of time, or to ship a limited quantity of parts or products
exhibiting a known deficiency.

Seller disputes concerning requirements, or whether part or product meets the
Buyers engineering specifications or engineering drawing requirements, shall be
reviewed and mediated by the Buyers representatives from the Quality Control,
Manufacturing Engineering, R&D, and Supply Chain Management departments.

The Seller shall install appropriate controls and methods to ensure the part or
product supplied meets the Buyers engineering specifications and engineering
drawing requirements upon final delivery to the Buyer. Seller controls shall be
considered for, but not limited to, operations within raw material receiving,
work-in-process, finished goods, packaging, and shipping.

Buyer may, at any point, reject part or product that does not meet the Buyers
engineering specifications, engineering drawing requirements, or deviated
requirements (per an approved and issued DFS). This shall include at the
receiving, storage, value-added operations, packaging, shipping, or customer
service stages of Buyer's use, and/or sale of the supplied part or product.

Rejected part or product shall be reviewed by the Buyer with the Seller for the
purpose of making a disposition of the part or product. The Seller shall have
the opportunity to review rejected part or product, and to dispute the
determination of rejection.

Where a rejection is found to be valid, the Seller shall perform an analysis of
the part, product, process, or other element within the Seller's scope of
operations, as necessary, and issue a report of corrective action to the Buyer.

The Seller shall allow buyer representatives to discuss, review, inspect,
measure, test, or otherwise evaluate part or product issues with Seller
representatives within the Seller's manufacturing facility(ies), at a Buyer's
facility, or at a mutually agreed upon location. Upon suitable notification to
the Seller, Buyer shall be allowed to verify compliance with this agreement, and
to perform on-site audits of the Seller's


manufacturing processes related to part or product as specified and purchased by
the Buyer.

Seller efforts to improve, cost-reduce, boost efficiencies, or otherwise change
the part, product, or the process originally agreed to, shall be reviewed in
advance with the Buyer, whether or not this activity has any affect or influence
on the part or product meeting the Buyer's engineering specifications or
engineering drawing requirements.

The Seller shall review plans to subcontract to another corporate entity, any
part or product the Buyer has contracted with the Seller to supply. This review
shall be completed prior to any such subcontracting, and shall include the
review and approval by the buyer of the Seller's quality plan for the
subcontracted part or product. In some instances, Buyer will require first piece
samples, including inspection and test data, from the subcontractor prior to
approval of part or product manufactured by the subcontractor. In any event, the
Seller shall remain fully and completely responsible for supplying the part or
product to the Buyer's engineering specification and engineering drawing

All air chamber testing shall be in accordance with Select Comfort's Air
Chamber, Rubber/Cotton Vulcanized Construction, Test and Inspection
Specification SP-004.

QUALITY DISCOUNT PERCENTAGE: as of February 2002 is XXX and shall remain in
effect as outlined in Article 8.

[Portions of this Exhibit have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of 1934,
as amended. A copy of this Exhibit with the portions intact has been filed
separately with the Securities and Exchange Commission.]


January 1, 2002 - December 31, 2003         36 Month warranty period
January 1, 2004 - December 31, 2005         48 Month warranty period
January 1, 2006 and beyond                  60 Month warranty period


Master Specification

[The entire contents of this Exhibit III have been omitted pursuant to a request
for confidential treatment under Rule 24b-2 of the Securities Exchange Act of
1934, as amended. A copy of this Exhibit with the contents intact has been filed
separately with the Securities and Exchange Commission.


Exhibit IV
Forecasted Volume

Fiscal Year                  Volume Range

2002                         425,000 - 475,000
2003                         450,000 - 500,000
2004                         475,000 - 525,000
2005                         525,000 - 575,000

Best effort will be made to submit standard purchase orders that represent 12
equal monthly quantities plus or minus 20% in any given month.

Fiscal Year means the twelve-month period from January 1 through December 31.
Any changes to the volumes represented above shall be mutually agreed to with a
minimum of three months notice prior to the requested change date.