Sleep Number Announces Inducement Grants under Nasdaq Listing Rule 5635(c)(4)

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Key Terms

restricted stock unit financial

A restricted stock unit is a promise from a company to give an employee shares of stock after certain conditions are met, like staying with the company for a set amount of time. It’s like earning a bonus that turns into company stock once you’ve proven your commitment, making it a way to motivate and reward employees.

performance stock unit financial

A performance stock unit is a type of reward companies give to employees, usually managers, that depends on how well the company performs over time. If the company hits specific goals, the employee earns shares of stock, like earning a prize for reaching certain levels in a game. It motivates employees to work hard because their rewards are tied to the company's success.

net sales financial

Net sales is the total money a company earns from selling its goods or services after subtracting returns, discounts, and allowances — like a store counting the cash it actually keeps after refunds and coupons. Investors use net sales to gauge true customer demand and the real size of a business’s revenue stream, since it forms the basis for profit margins, growth trends, and comparisons between companies.

free cash flow financial

Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.

total shareholder return financial

Total shareholder return is the overall gain an investor gets from owning a stock, combining changes in the share price plus any cash payouts like dividends, and assuming those payouts are reinvested in more shares. Investors use it like a single score that shows the true return on their investment—similar to checking both the growth of a savings account and the interest earned—to compare how well different companies or investments perform over time.

nasdaq listing rule 5635(c)(4) regulatory

NASDAQ Listing Rule 5635(c)(4) is a rule that requires a company to get approval from its shareholders before selling a large amount of its shares, usually over 20%. This helps protect investors by making sure the company doesn't flood the market with new shares without their say, which could lower the stock's value.

03/16/2026 - 04:00 PM

MINNEAPOLIS--(BUSINESS WIRE)-- Sleep Number Corporation (Nasdaq: SNBR) today announced that it granted equity awards on March 16, 2026, as a material inducement to the employment of the company's Executive Vice President and Chief Financial Officer, Amy O’Keefe.

As previously disclosed, in connection with the appointment of O’Keefe as Executive Vice President and Chief Financial Officer effective December 8, 2025, Sleep Number agreed to grant O’Keefe employment inducement awards on or around March 15, 2026. The equity awards granted on March 16, 2026 pursuant to that agreement consist of: (i) 66,965 shares of common stock underlying a time-vested restricted stock unit award, vesting in three equal installments on each anniversary of the grant date; and (ii) 89,286 shares of common stock underlying a performance stock unit award, assuming target performance, vesting on the third anniversary of the date of grant with the number of shares to be earned based on net sales growth and free cash flow goals for fiscal years 2026 to 2028 and as further adjusted based on the company’s relative total shareholder return. The performance stock unit award provides for a maximum payout of 200% of target, or up to 178,572 shares. The grants are subject to continued employment and the terms of the respective award agreements.

The inducement awards to O’Keefe were granted as a material inducement to her employment and were approved by the Sleep Number Board of Directors on November 28, 2025, in accordance with Rule 5635(c)(4) of The Nasdaq Stock Market LLC. The awards were granted outside Sleep Number’s equity incentive plan.

About Sleep Number Corporation

Sleep Number is the leader in personalized sleep wellness. Its mattresses are designed to evolve with each sleeper to help them feel and perform their best. With adjustable firmness, pressure-relieving support and temperature balancing comfort built into every mattress, Sleep Number^® beds adapt to customers’ changing needs, night after night, year after year.

Backed by almost 40 years of innovation, 1,000+ patents and patents pending, and billions of hours of sleep data, Sleep Number has helped more than 16 million people achieve their best sleep. The fully integrated model ensures quality, durability, and care at every step—from design and craftsmanship to delivery and long-term support.

Sleep Number products are awarded the industry's top recognitions, including ranked #1 in customer satisfaction for mattresses purchased in-store and online, and #1 in comfort, by J.D. Power. In addition, the company is the Official Sleep + Wellness Partner of the NFL, marking a relationship that leverages players, team partnerships, and league-wide initiatives to amplify brand awareness and drive consumer engagement.

Sleep Number mattresses, bases, bedding, and furniture are available exclusively at its 600 stores nationwide and online. To learn more, visit SleepNumber.com or a store near you.