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Exhibit 10.2
 
TEMPUR SEALY INTERNATIONAL, INC.
(Formerly Known as Tempur-Pedic International Inc.)
SEVERANCE AND RETENTION PLAN

PLAN DOCUMENT AND
SUMMARY PLAN DESCRIPTION

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TEMPUR SEALY INTERNATIONAL, INC.
SEVERANCE AND RETENTION PLAN

This Tempur Sealy International, Inc. (formerly known as Tempur-Pedic
International Inc.) Severance and Retention Plan (the “Plan”) is established by
Tempur Sealy International, Inc. (the “Company”), effective as of the Effective
Date.  All references to the “Tempur-Pedic International Inc. Severance and
Retention Plan” or the “Tempur Sealy International, Inc. Severance and Retention
Plan” in Agreements entered into by the Company or its subsidiaries shall be
deemed to refer to this Plan.

The Plan will be administered for the exclusive purpose of providing Eligible
Employees with severance and retention benefits in accordance with the
provisions of the Plan.  The Plan is designed to attract and retain Eligible
Employees to remain with and devote their best efforts to the Company’s business
and their employment with an Employer, and to offer a form of protection in the
event their employment with an Employer terminates for a reason covered by the
Plan.  The Plan provides retention benefits in the form of cash and equity and
severance benefits to Eligible Employees who satisfy the employment conditions
established by their Employer.  This Plan is intended to be an “employee welfare
benefit plan” within the scope of Section 3(1) of ERISA.  The Plan is not
intended to be a pension plan under Section 3(2)(A) of ERISA and shall be
maintained and administered so as not to be such a plan.  All amounts payable
under this plan are intended to comply with either the “short term deferral”
exception from Code Section 409A specified in Treas. Reg. § 1.409A-1(b)(4) (or
any successor provision) or one or more of the “separation pay plan” exceptions
specified in Treas. Reg. § 1.409A-1(b)(9) (or any successor provision), and
shall be interpreted in a manner consistent with those exceptions. The benefits
provided under this plan are not intended to be deferred compensation under Code
Section 409A and Treas. Reg. § 1.409A-1(b)(9)(iii).

This document is the official plan document, as well as the summary plan
description.  In the event of any unintended inconsistency between the Plan
document and any oral or written communication relating to the Plan or Plan
Benefits, the Plan document shall control.

ARTICLE I.  DEFINITIONS
 
For purposes of the Plan, the following terms, when used with an initial capital
letter, will have the meaning set forth below unless a different meaning is
provided in the Agreement or plainly required by the context.

“Affiliate” shall mean a person or entity that directly or indirectly owns or
controls, is owned or controlled by, or is under the common ownership or control
of another person or entity.

“Agreement” means an employment agreement, offer letter, award agreement under
the Equity Incentive Plan, or any other written agreement between an Eligible
Employee and an Employer providing for the payment of Retention Benefits,
Severance Benefits or both.

“Accrued Benefits” means (i) the Participant’s Base Salary paid through the
Participant’s Termination Date; (ii) reimbursement for reasonable business
expenses incurred in the ordinary course of the Participant’s duties prior to
the Participant’s Termination Date in accordance with the Employer’s policies;
provided claims for such reimbursement are submitted to the Employer within 60
days following the Participant’s Termination Date; and (iii) the value of any
accrued unused vacation.
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“Base Salary” means, unless otherwise specified in an Agreement, a Participant’s
base salary as in effect on the Termination Date, excluding overtime, bonuses,
incentive pay, commissions, premium pay, the cash value of any and all non-cash
benefits, expense reimbursements, and similar amounts.  Base Salary shall be
calculated before any reductions or withholdings for taxes, employee benefits,
or other similar reasons.

 
“Benefits” shall mean Severance Benefits, Cash Retention Bonus and Equity
Retention Grant.

“Cash Retention Bonus” means a cash bonus that an Eligible Employee may be
eligible to receive pursuant to Section 3.1.

“Cause” shall mean, unless otherwise specifically provided in an Agreement, any
of the following:  (i)  performance by the Employee of illegal or fraudulent
acts, criminal conduct, or willful misconduct relating to the activities of the
Company or any Employer; (ii) performance by the Employee of any acts involving
moral turpitude and having a material adverse effect on the Company or any
Employer, including without limitation upon profitability, reputation or
goodwill; (iii) willful or grossly negligent failure by the Employee to perform
the duties he is assigned by the Employer in a manner that he knows, or has
reason to know, to be in the Company’s or the Employer’s best interests
including, but not limited to, the Employee’s failure to fully cooperate in
transitioning his work duties as required by the Company or the Employer; (iv)
willful and bad faith refusal by the Employee to carry out reasonable
instructions of the Employer; and (v) any other material breach of the
Employee’s obligations to the Company or the Employer which is incurable or
which the Employee fails to cure promptly after receiving written notice
thereof.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time.

“Committee” shall mean a committee comprised of individuals who hold the
following positions from time to time at the Company:   EVP & Chief Operating
Officer, EVP & Chief Financial Officer, EVP & Chief Human Resources Officer, SVP
Human Resources, and SVP Global Operations.

“Company” means Tempur Sealy International, Inc. (formerly known as Tempur-Pedic
International Inc.), a corporation organized under the laws of the State of
Delaware, and any predecessor or successor thereto.

“Disability” shall mean a Participant’s physical or mental impairment such that
he or she qualifies for benefits under a long-term disability insurance plan
sponsored by his or her Employer.

“Effective Date” means March 18, 2013.
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“Eligible Employee” means any Employee who has been selected by the Committee to
participate in the Plan; provided, however, any individual who falls within one
or more of the following categories will not be considered an Eligible Employee:
 
(i)            any Employee who is covered by a collective bargaining agreement;
 
(ii)            any Employee who is employed by his Employer as an intern or on
a temporary, vacation relief, leave of absence relief or seasonal basis, or any
similar basis;
 
(iii)           any Employee in a division or operating unit of an Employer the
Employee(s) of which are designated as excluded from coverage under the Plan, or
who is a member of a group of Employee(s) that is designated as excluded from
coverage under the Plan by action of an Employer; and
 
(iv)          any Employee who is employed under an agreement that states that
the Employee is not eligible to participate in the Plan.

The Committee shall have broad discretionary powers to interpret this definition
of Eligible Employee and to exclude such persons as it determines are excluded
hereby.

“Employee” means any individual who is providing services to an Employer as a
common-law employee and who is designated as an employee of the Employer on the
payroll records thereof.  The term “Employee” shall not include any individual
during any period he or she is classified or treated by the Employer as an
independent contractor, a consultant, or any employee of an employment,
consulting, or temporary agency or any other entity other than the Employer,
without regard to whether such individual is subsequently determined to have
been, or is subsequently retroactively reclassified as a common-law employee of
the Employer during such period.

“Employer” shall mean the Company or any Affiliate of the Company (now in
existence or hereafter formed or acquired) that is designated as a participating
employer by the Committee.  Each Employer who participates in the Plan shall be
deemed to appoint the Company, the Committee and the Board of Directors of the
Company with all the power and authority conferred in the Plan upon such
parties.  Such power and authority to act as such agents for the Employer shall
continue until the Plan is completely terminated as to the Employer.  With
respect to a given Participant, references to the Employer mean the Employer
which employs the Participant, unless the context otherwise requires.
 
“Equity Incentive Plan” means the Amended and Restated Tempur-Pedic
International Inc. 2003 Equity Incentive Plan, or any successor plan.

“Equity Retention Grant” means the grant of Restricted Stock Units, or such
other form of equity grant described in an Agreement and granted in accordance
with and, subject to the terms and conditions of, the Equity Incentive Plan,
that an Eligible Employee may be eligible to receive pursuant to Section 3.2.
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“ERISA” means Employee Retirement Income Security Act of 1974, as amended from
time to time.

“Initial Term” with respect to a Sealy Participant means, unless otherwise
specifically defined in an Agreement, the period commencing on the Sealy
Transaction Date and ending on the second anniversary thereof.

“Good Reason” means, except as otherwise provided in an Agreement, any of the
following: (i) relocation of Participant’s principal workplace over sixty (60)
miles from the Employer’s existing workplaces without the consent of Participant
(which consent shall not be unreasonably withheld, delayed or conditioned), or
(ii) the Employer’s material breach of an Agreement or any other written
agreement between Participant and the Employer which is not cured within thirty
(30) days after receipt by the Employer from Participant of written notice of
such breach.
 
“Grant Date” means the date on which an Equity Retention Grant is granted to an
Eligible Employee pursuant to the terms of the Equity Incentive Plan.

“Participant” means an Eligible Employee who has satisfied the conditions for
participation set forth in Section 2.1.

“Plan” means this Tempur Sealy International, Inc. Severance and Retention Plan,
as amended from time to time.

“Plan Administrator” means the Committee.

“Release” means a fully executed release, in a form satisfactory to the
Employer, by which a Participant releases any and all claims against the Company
and the Employer relating to or arising out of his or her employment and
termination with the Employer.  A Release is valid only if it is submitted to
the Employer within the timeframe set forth in the Release and it is not revoked
within the time period permitted by law.

“Renewal Term” with respect to a Sealy Participant means, unless otherwise
specifically defined in an Agreement, each successive one-year period, following
the expiration of the Initial Term, for which the Employer agrees to employ
Participant and the Participant accepts employment with the Employer, in
accordance with the terms of an Agreement.

“Retention Benefits” shall mean the Cash Retention Bonus and Equity Retention
Grant described in Article III.

“Retention Period” shall mean the period specified in an Agreement during which
the Eligible Employee must remain an Employee in order to become entitled to
Retention Benefits and Severance Benefits, or such earlier date as the Employer
may specify in writing from time to time.  With respect to a Sealy Participant,
the Retention Period shall end at the end of the Initial Term, or such other
date as may be agreed to in writing by the Employer and a Participant.
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“Restricted Stock Unit” or “RSU” means a restricted stock unit granted under and
pursuant to the terms of an Equity Incentive Plan and in accordance with Section
3.2 of this Plan.

“Salary Grade” means the classification grade for a Participant’s job position,
determined utilizing the compensation policy of the Participant’s Employer in
effect as of the time of any award of Benefits.

“Sealy” means Sealy Corporation, a Delaware corporation, a subsidiary of the
Company.

“Sealy Participant” means an individual who was employed by Sealy immediately
prior to the Sealy Transaction and who, in connection with the Sealy
Transaction, became an Employee and entered into an Agreement providing for Plan
participation.

“Sealy Transaction” means the acquisition of Sealy by the Company

“Sealy Transaction Date” means the closing date of the Sealy Transaction.

“Severance Benefits” means, except as otherwise provided in an Agreement, the
compensation and benefits, if any, other than Accrued Benefits, a Participant
may be entitled to receive under Section 4.1.

“Severance Period” means the period of time that a Participant may be eligible
to receive Severance Benefits.  Unless otherwise specifically provided in an
Agreement, a Participant’s Severance Period shall be based on the Participant’s
Years of Service and Salary Grade.

“Stock” means common stock, par value $0.01 per share, of the Company and such
other securities as may be substituted for Stock pursuant to an Equity Incentive
Plan.

“Termination Date” means the last day worked by a Participant for his or her
Employer.

“Years of Service” means, except as otherwise provided in an Agreement, the
number of years and portions thereof of continuous employment with any Employer,
calculated as of an individual’s Termination Date.  With respect to a Sealy
Participant, “Years of Service” means the number of years and portions thereof
of continuous employment with Sealy and/or any Sealy subsidiary, calculated as
of the Sealy Transaction Date.

“Vesting Date” means the date upon which a Retention Benefit vests in accordance
with Sections 3.1(a) and 3.2(a), as applicable.

“Voluntary Termination” means any retirement or voluntary resignation from
employment other than for Good Reason.
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ARTICLE II.  ELIGIBILITY AND PARTICIPATION
 
Section 2.1       Eligibility for Plan Benefits Generally.  Each Eligible
Employee who has received an Agreement may become a Participant eligible for
Plan Benefits if he or she elects to participate in the Plan by (i) agreeing to
and signing the Agreement and (ii) returning the signed Agreement to the
Committee within the time period specified in the Agreement, or if none, the
time period determined by the Committee. Each Agreement will specify the amount
and type of any applicable Retention Benefits and Severance Benefits, vesting
conditions, payment terms and such other terms and conditions specified by the
Committee.
 

(a)           Eligibility for Retention Benefits.  Except as otherwise provided
in an Agreement, a Participant will be entitled to receive Retention Benefits
if:
 
(i)            The Participant remains employed by the Employer through the end
of the Retention Period while fulfilling all obligations set forth in an
Agreement; or
 
(ii)            The Participant’s employment is terminated by the Employer
without Cause or by the Participant for Good Reason during the Retention Period
and the Participant executes and delivers a Release to the Employer on or after
the Participant’s Termination Date and the Release has become effective.
 
Except as otherwise provided in an Agreement, Participants shall not be entitled
to receive Retention Benefits if they are terminated for any other reason before
the end of the Retention Period.
 
(b)            Eligibility for Severance Benefits.  Except as otherwise provided
in an Agreement, a Participant will be entitled to Severance Benefits if the
Participant’s employment with the Employer is terminated by the Employer without
Cause or by the Participant for Good Reason, and with respect to a Sealy
Participant, after the end of the Initial Term but before the end of a Renewal
Term, provided that in either case the Participant executes and delivers a
Release to the Employer on or after the Participant’s Termination Date and the
Release has become effective.  Participants shall not be entitled to receive
Severance Benefits (other than Accrued Benefits) if they are terminated for any
other reason, including, with respect to a Sealy Participant, termination at the
end of the Initial Term or any Renewal Term.
 

(c)            Restrictive Covenants.  As consideration for the Committee’s
offer of participation in this Plan to Eligible Employees and for other good and
valuable consideration, during employment and upon termination of employment for
any reason, each Participant must comply with the restrictive covenants, if any,
set forth in an Agreement or other Company or Employer policy.  In addition,
receipt of Severance Benefits other than Accrued Benefits is expressly
conditioned upon such Participant’s continued compliance with any such
restrictive covenants.
 
ARTICLE III.  RETENTION BENEFITS
 
Section 3.1             Cash Retention Bonus.  The Company, in its sole
discretion, may award a Cash Retention Bonus to any Eligible Employee.  The
amount of the Cash Retention Bonus shall be determined by the Company in its
sole discretion and specified in the Agreement between the Employer and the
Eligible Employee.
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(a)            Vesting.  Except as otherwise provided in the Plan or an
Agreement, the Cash Retention Bonus will vest at the end of the Retention
Period, or, with respect to a Sealy Participant, will vest if Participant
remains employed by the Employer from the Sealy Transaction Date through the
Vesting Dates described below while fulfilling all obligations set forth in the
Agreement:
 
(i)            Thirty-three (33%) of the Cash Retention Bonus shall vest upon
the first anniversary of the Sealy Transaction Date; and
 
(ii)            The remaining sixty-seven percent (67%) of the Cash Retention
Bonus shall vest upon the second anniversary of the Sealy Transaction Date.
 

(b)            Form and Time of Payment.  Except as otherwise provided in the
Plan or Agreement, the vested portion of the Cash Retention Bonus will be paid
to the Participant (or to his or her estate in the event of the Participant’s
death after a Vesting Date but prior to payment), subject to any required tax or
other withholdings, in a single lump sum within 60 days following the applicable
Vesting Date.
 
Section 3.2             Equity Retention Grant.  The Company, in its sole
discretion, may grant an Equity Retention Grant to any Eligible Employee on any
date.  The Equity Retention Grant shall be granted in accordance with and,
subject to the terms and conditions of, an Equity Incentive Plan and the terms
of the Equity Retention Grant shall be set forth in a separate written
agreement.  Each RSU that is subject to an Equity Retention Grant shall entitle
the recipient to a share of Stock upon the satisfaction of the vesting
conditions set forth in Section 3.2(a).  Any such Equity Retention Grant shall
have a Grant Date fair value equal to a dollar amount determined by the
Committee in its sole discretion and specified in the Agreement between the
Employer and the Eligible Employee.

 
(a)            Vesting.  Except as otherwise provided in the Plan or an
Agreement, the Equity Retention Grant will vest at the end of the Retention
Period, or, with respect to a Sealy Participant, will vest if Participant
remains employed by the Employer from the Sealy Transaction Date through the
Vesting Dates described below while fulfilling all obligations set forth in the
Agreement:
 
(i)            Thirty-three (33%) of the RSUs shall vest upon the first annual
anniversary of the Sealy Transaction Date; and
 
(ii)            The remaining sixty-seven percent (67%) of the RSUs shall vest
upon the second annual anniversary of the Sealy Transaction Date.
 
(iii)            Form and Time of Payment.  Except as otherwise provided in the
Plan or Agreement, the Participant (or in the event of the Participant’s death
after a Vesting Date but prior to settlement, his or her estate) shall receive a
share of Stock for each vested RSU, subject to any required tax or other
withholdings, and any such shares of Stock will be distributed within 60 days
following the RSU’s Vesting Date.
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Section 3.3        Withholding.  Any payment of Retention Benefits, including
dividend equivalents, if any, are subject to such withholding and to such other
deductions as may be required under any applicable income tax or other law,
whether of the United States or any other country, and whether federal, state or
local.  In the event of any distribution of Stock, the Employer may require the
recipient to remit an amount sufficient to satisfy any such applicable
withholding requirements or allow the recipient to satisfy any withholding
obligations by having shares of Company stock withheld up to an amount that does
not exceed the minimum withholding requirements under applicable law.
 
Section 3.4        Termination.  Any unvested Retention Benefits shall be paid
to a Participant if the Participant’s employment is terminated by the Employer
without Cause, by the Participant for Good Reason during the Retention Period
and in other circumstances provided in an Agreement, provided in all cases that
the Participant executes, and does not revoke, a Release.  The unvested portion
of the Cash Retention Benefit shall be paid in a lump sum in cash and, with
respect to the unvested portion of the Equity Retention Grant, shares of Stock,
within sixty (60) days following Participant’s Termination Date, provided that
Participant has executed and delivered a Release and the Release has become
effective.
 
Section 3.5        Death.  Except as otherwise provided in an Agreement, for the
avoidance of doubt, (a) a Participant shall not vest in any portion of a Cash
Retention Bonus or Equity Retention Grant that is unvested as of the date of the
Participant’s death and (b) a Participant must be employed by the Employer on
the Vesting Date to become vested in the Benefit.  A Participant’s estate shall
only receive the vested portion, if any, of a Cash Retention Bonus, Equity
Retention Grant or both that is unpaid as of the date of the Participant’s
death.
 
ARTICLE IV.  SEVERANCE BENEFITS
 
Section 4.1        Termination Without Cause or for Good Reason.  The Company,
in its sole discretion, may award Severance Benefits to any Eligible Employee
who satisfies the requirements set forth in Section 2.1(b).  Severance Benefits
shall be determined by the Company in its sole discretion and specified in the
Agreement between the Employer and the Eligible Employee.  Severance Benefits
may include, but need not be limited to:

 
(a)            Cash severance payments; and
 
(b)            Continued health insurance coverage for a limited period of time
in accordance with the Employer’s policy in effect for a Participant on the
Participant’s Termination Date, and following that coverage, if any, the
opportunity to elect continuation of coverage pursuant to the requirements of
the Consolidated Omnibus Budget Reconciliation Act (“COBRA”).
 
Section 4.2        Voluntary Termination; Termination for Death or Disability.
 Except as otherwise provided in an Agreement, if a Participant’s employment
terminates on account of (a) Voluntary Termination, (b) death, or (c)
Disability, Participant shall not be entitled to receive Severance Benefits
under this Plan and shall be entitled only to receive his or her Accrued
Benefits.
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Section 4.3       Termination for Cause.  If a Participant’s employment is
terminated by the Employer for Cause, the Participant shall not be entitled to
receive Severance Benefits under this Plan and shall be entitled only to receive
his or her Accrued Benefits.  Notwithstanding any other provision of the Plan to
the contrary, if the Employer determines, at any time, that a Participant has
engaged in conduct prior to the Participant’s Termination Date that constitutes
Cause, any Severance Benefits payable or provided to the Participant under the
Plan shall immediately cease, and the Participant shall be required to return
any Severance Benefit paid or provided to the Participant prior to such
determination.  Except as described in this Section, the Company and the
Employer shall have no further obligations to such Participant under the Plan.
 
Section 4.4        Payment of Severance Benefits in the Event of Death.  If a
Participant dies after becoming eligible to receive Severance Benefits in
accordance with Section 2.1(b), all such cash amounts, unless otherwise provided
herein, shall be paid to the Participant's estate as if Participant had
continued to live.

 
Section 4.5        Release Required.  If the Participant does not deliver an
executed Release to the Employer within the time set forth in the Release or if
the Participant revokes an executed Release within the time period permitted by
law, the Participant shall not be entitled to the Severance Benefits (other than
the Accrued Benefits) set forth in Section 4.1 or the Retention Benefits payable
upon the Participant’s termination of employment, set forth in Section 3.4.

 
Section 4.6       Withholding.  Any payment of Severance Benefits or Accrued
Benefits to a Participant are subject to such withholding and to such other
deductions as may be required under any income tax or other law, whether of the
United States or any other country, and whether federal, state or local.

 
Section 4.7        Benefit Plans.  Except as otherwise provided in the Plan or
an Agreement, as of a Participant’s Termination Date, the Participant shall
cease active participation in and eligibility for any Employee benefit plan,
program or policy sponsored or subsidized by the Employer, unless otherwise
specifically required to be continued pursuant to applicable law or the terms of
such plan, program, or policy.
 
ARTICLE V.  ADMINISTRATION OF THE PLAN
 
Section 5.1       Administration.  The Committee shall be the Plan
Administrator, and will be the named fiduciary of this Plan for purposes of
ERISA.  The Committee shall have the sole and final discretionary authority and
responsibility for all matters in connection with the operation and
administration of the Plan, including, but not limited to:
 
(a)            the authority to construe and interpret the terms of the Plan and
all facts surrounding claims for benefits under the Plan;
 
(b)            to determine claims for violation of applicable employment laws,
whether of the United States or any other jurisdiction, including federal, state
or local laws addressing the employment practices described in Section 7.12, in
the selection of Participants and payment of Plan Benefits;
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(c)            to adopt, prescribe, amend and rescind rules and practices
concerning Plan administration;
 
(d)            to delegate any or all of its authority to an individual, entity
or committee as it deems appropriate and to rescind any such delegation in whole
or in part;
 
(e)            interpret, administer, reconcile any inconsistency in, correct
any defect in and/or supply any omission in the Plan and any instrument, or
agreement relating to the Plan; and
 
(f)            to make all other determinations necessary or advisable in its
discretion for the administration of the Plan, including, but not limited to,
those concerning eligibility for benefits and resolving disputed issues of fact.
 
Section 5.2        Non-Uniform Treatment.  The Committee's determinations under
the Plan need not be uniform and any such determinations may be made selectively
among Participants. Without limiting the generality of the foregoing, except to
the extent prohibited by applicable law, the Committee shall be entitled, among
other things, to make non-uniform and selective determinations with regard to
the amount, terms or conditions of any Cash Retention Bonus, Equity Retention
Grant or Severance Benefit.
 
Section 5.3        Committee Decisions Final.  All determinations of the
Committee (or its designee) with respect to the Plan will be conclusive and
binding on all parties, unless such decisions are determined by a court having
jurisdiction to be arbitrary and capricious.
 
Section 5.4       Indemnification. The Company shall indemnify and hold harmless
the Committee and each member thereof against any claim, cost, expense
(including reasonable attorneys’ fees), judgment or liability (including any sum
paid in settlement of a claim with the approval of the Company) arising out of
any act or omission to act of the Committee or a member thereof under the Plan,
except in the case of willful misconduct.
 
ARTICLE VI.  CLAIMS PROCEDURES
 
Section 6.1        Procedure for Granting or Denying Claims.  Any claim for
benefits under this Plan shall be made in writing to the Committee, in person or
by mail, postage paid.  All such claims must be filed no later than one year
following the date on which an individual ceased to be an Employee, or if still
an Employee, within one year following the date on which the claim arose.  A
former Employee’s rights with respect to any claim that is not submitted within
the applicable time limit shall be waived.  Within 90 days after receipt of any
claim, the Committee will notify the claimant of the granting or denying, in
whole or in part, of such claim, unless special circumstances require an
extension of time for processing the claim.  If such extension is necessary, the
Committee will notify the claimant within the initial 90-day period that the
Committee needs up to an additional 90 days to review the claim.  The Committee
will have full discretion to deny or grant a claim in whole or in part.
 
Section 6.2        Notice of Denial.  The Committee will provide to every
claimant who is denied a claim for benefits a written notice setting forth in a
manner calculated to be understood by the claimant:
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(a)            The specific reason or reasons for the denial;
 
(b)            Specific reference to pertinent Plan provisions on which the
denial is based;
 
(c)            A description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why such material or
information is necessary; and
 
(d)            An explanation of the Plan’s claim review procedures and the time
limits applicable to such procedures, including a statement of the claimant’s
right to bring a civil action under Section 502(a) of ERISA following an adverse
determination on review.
 
The decision or action of the Committee shall be final, conclusive and binding
on all persons having any interest in the Plan, unless a written appeal is filed
as provided in Section 6.3 hereof.
 
Section 6.3        Review of Claim Denial.  Within 60 days after the receipt by
the claimant of notice of denial of a claim, the claimant may (1) file a request
with the Committee that it conduct a full and fair review of the denial of the
claim, (2) receive, upon request and free of charge, reasonable access to, and
copies of, all documents, records, and other information relevant to the claim
for benefits, and (3) submit questions and comments to the Committee in writing.
 
Section 6.4        Decision After Review.  Within 60 days after the receipt of a
request for review under Section 6.3, the Committee shall deliver to the
claimant a written decision with respect to the claim, except that if there are
special circumstances which require more time for processing, the 60-day period
shall be extended to 120 days upon notice to that effect to the claimant.  The
decision shall be written in a manner calculated to be understood by the
claimant and shall (1) include the specific reason or reasons for the decision,
(2) contain a specific reference to the pertinent Plan provisions upon which the
decision is based, (3) a statement that the claimant is entitled to receive,
upon request and free of charge, reasonable access to, and copies of, all
documents, records, and other information relevant to the claim for benefits,
and (4) a statement of the claimant’s right to bring a civil action under
Section 502(a) of ERISA.  All interpretations, determinations and decisions of
the Committee with respect to any claim shall be made in its sole discretion,
and shall be final and conclusive.
 
Section 6.5       Bar to Legal Action.  A claimant must exhaust the claims
procedures set forth in this Article 6 of the Plan prior to commencing a legal
action to (i) recover benefits under the plan, (ii) enforce the claimant’s
rights under the terms of the plan, or (iii) clarify the claimant's right to
future benefits under the terms of the plan.
 
Section 6.6        Limitation on Forum and Time Limitation on Actions.  If,
after exhausting the claims procedures set forth in this Article 6, a claimant
wishes to pursue legal action, any action by the claimant to (i) recover
benefits under the plan, (ii) enforce the claimant’s rights under the terms of
the plan, or (iii) clarify the claimant's right to future benefits under the
terms of the plan, or any combination of them must be brought in the United
States District Court for the Eastern District of Kentucky in Lexington,
Kentucky.  Any such action must be filed within 6 months of receipt of the final
decision rendered by the Committee in accordance with Section 6.4, above.  A
claimant will waive any claims not brought within 6 months following the
Committee’s final decision.
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ARTICLE VII.  MISCELLANEOUS
 
Section 7.1       Amendment or Termination.  The Company hereby reserves the
right to amend or terminate the Plan or any Plan Benefits, in whole or in part,
at any time without the consent of, or the prior notification to, Participants.
 Any such amendment or termination shall be set forth in writing and must be
adopted by the Company.  No such amendment or termination shall reduce the Plan
Benefits payable pursuant to an Agreement that is in effect at the time the Plan
is amended or terminated without the written consent of the Participant.
 
Section 7.2        No Right to Continued Employment.  Nothing contained in this
Plan, any Agreement or any documents relating to this Plan shall (1) affect any
Participant’s status as an “at-will” employee of the Employer; (2) confer on a
Participant any right to continue in the employ of the Employer, the Company or
any of their Affiliates; or (3) interfere in any way with the Employer’s right
to terminate Participant’s employment at any time, with or without cause.
 
Section 7.3        Unfunded Plan; Unsecured General Creditor.  The Plan shall be
unfunded. No Participant or any other party claiming an interest in amounts
earned under the Plan shall have any interest whatsoever in any specific asset
of the Company, the Employer or any of their Affiliates.  To the extent that any
party acquires a right to receive payments under the Plan, such right shall be
equivalent to that of an unsecured general creditor of the Company and the
Employer.
 
Section 7.4       Company Liability.  The liability of the Company, the Employer
and any of their Affiliates for Plan Benefits is defined only by the Plan.  The
Company, the Employer and any of their Affiliates have no obligation to
Participants except as expressly provided in the Plan.  Nothing in this document
should be construed to mean that the Plan Benefits are guaranteed.
 
Section 7.5        Plan Exclusive Source of Rights.  This Plan and the
Agreements contain all of the terms and conditions with respect to Retention
Benefits and Severance Benefits, and no Employee or former Employee may rely on
any other communication or representation, whether oral or written, of the
Company, the Employer or any of their Affiliates, or any officer or Employee of
the Company, the Employer or any of their Affiliates, as creating any right or
obligation not expressly provided by this Plan.
 
Section 7.6        Effect on Other Benefits. The value of any Severance Benefits
shall not be considered eligible earnings for purposes of any other plans
maintained by the Employer. Neither shall such value be considered part of the
Participant’s compensation for purposes of determining or calculating other
benefits that are based on compensation.
 
Section 7.7       Integration With Other Payments.  Plan Benefits are not
intended to duplicate such benefits as workers' compensation wage replacement
benefits, disability benefits, pay-in-lieu-of-notice, severance pay, or similar
benefits under other benefit plans, severance programs, employment contracts, or
applicable laws, such as the WARN Act.  Should such other benefits be payable, a
Participant’s Benefits will be reduced accordingly or, alternatively, Benefits
previously paid under this Plan will be treated as having been paid to satisfy
such other benefit obligations.  In either case, the Committee, in its sole
discretion, will determine how to apply this provision and may override other
provisions in this Plan in doing so.
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Section 7.8        Nonassignability.  Except as otherwise provided in an
Agreement, no benefit payable under the Plan or Agreement to any Participant may
be sold, transferred, assigned, alienated, pledged, or encumbered other than to
a designated beneficiary upon the Participant's death or by will or the laws of
descent or distribution.  To the maximum extent permitted by law, Plan benefits
shall not in any way be subject to claim of creditors or liable to attachment,
execution or other process of law.  The Employer retains the discretion at all
times in accordance with the laws of the United States or any other
jurisdiction, and whether federal, state or local, to reduce the amount of
benefits payable under the Plan to any Participant to recover any amounts which
the Participant owes the Company, the Employer or any of their Affiliates.
 
Section 7.9        Right to Recovery.  All Plan Benefits and payment thereof
shall be subject to any applicable clawback or recoupment policy of the Company
or the Employer, as may be adopted from time to time.  In the event any payments
are made in error, the Plan, the Company and/or the Employer shall have the
right to recover any such amounts.
 
Section 7.10     Acceptance; Acknowledgement of Authority.  All Plan Benefits
shall be provided conditionally upon the Participant’s acknowledgement and
agreement, by returning a signed copy of the Agreement to the Committee within
the time period required by the Committee, (a) to be bound by the terms of the
Plan and the Agreement, (b) to sign any ancillary documents or forms necessary
to effectuate the intent of the Plan and provisions of Benefits under the Plan,
as determined by the Committee; (c) to be bound by the determinations and
decisions of the Committee with respect to the Agreement, the Plan and the
Participant's rights to benefits under the Agreement and the Plan, and (d) that
all such determinations and decisions of the Committee shall be binding on the
Participant, his or her beneficiaries and any other person having or claiming an
interest in such Agreement and the Plan on behalf of the Participant.
 
Section 7.11     Notices.  Any and all notices provided for in the Plan or
Agreement shall be given in writing and shall be deemed given to a party at the
earlier of (i) when actually delivered to such party, or (ii) when mailed to
such party by registered or certified mail (return receipt requested) or sent to
such party by courier, confirmed by receipt, and addressed to such party at:
 (y) if to an Employee, at his or her residence address last filed with the
Employer and (Z) if to the Employer, to the following:
 
Tempur Sealy International, Inc.
1000 Tempur Way
Lexington, Kentucky 40511
Attention: Executive Vice President and Chief Human Resources Officer
 
With a copy to:
 
Legal Department
Tempur Sealy International, Inc.
1000 Tempur Way
Lexington, Kentucky 40511
Attention: Executive Vice President, General Counsel and Secretary
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Section 7.12    Applicable Laws.  This Plan shall be construed in a manner to
comply with applicable laws prohibiting discrimination on the basis of race,
color, religion, sex, age, national origin, marital status, physical or mental
disability, or any other status protected under the laws of the United States or
any other jurisdiction, and whether federal, state or local.
 
Section 7.13     Governing Law, Jurisdiction.  The validity, interpretation,
construction and performance of the obligations created under this Plan will be
governed by ERISA, and the laws of the Commonwealth of Kentucky without regard
to its conflicts of law principles.
 
Section 7.14     Validity.  If any provision of this Plan is determined to be
invalid or unenforceable, then such invalidity or unenforceability shall have no
effect on the other provisions hereof, which shall remain valid, binding and
enforceable and in full force and effect, and the Plan shall be construed as if
any such invalid or unenforceable provision were not a part hereof.
 
Section 7.15     Successors.  This Plan shall be binding upon and inure to the
benefit of the Company and any successor to the Company and the Participant’s
heirs, executors, administrators and legal representatives.
 
Section 7.16     Headings; Gender; Number.  Article and section headings are for
convenience only and the language of the Plan itself will be controlling.
 Except where otherwise indicated by the context, any masculine term used herein
also shall include the feminine; the plural shall include the singular and the
singular shall include the plural.
 
Section 7.17     Code Section 409A; Taxes.  All amounts payable under this Plan
are intended to comply with the “short term deferral” exception from Code
Section 409A (“Section 409A”) specified in Treas. Reg. § 1.409A-1(b)(4) (or any
successor provision) or the “separation pay plan” exception specified in Treas.
Reg. § 1.409A-1(b)(9) (or any successor provision), and shall be interpreted in
a manner consistent with those exceptions. Notwithstanding the foregoing, to the
extent that any amounts payable in accordance with the Plan are subject to
Section 409A, the Plan shall be interpreted and administered in such a way as to
comply with the applicable provisions of Section 409A to the maximum extent
possible.  To the extent that the Plan is subject to Section 409A and fails to
comply with the requirements of Section 409A, the Committee reserves the right
(without any obligation to do so) to amend or terminate the Plan and/or amend,
restructure, terminate or replace the Plan in order to cause the Plan either to
comply with the applicable provisions of Section 409A or not be subject to
Section 409A.  Each payment of compensation under the Plan shall be treated as a
separate payment of compensation for purposes of applying Section 409A.   If
 payment of any amount of “deferred compensation” (as defined under Section 409A
) is triggered by a separation from service that occurs while the Participant is
a “specified employee” (as defined under Section 409A), and if such amount is
scheduled to be paid within six (6) months after such separation from service,
the amount shall accrue without interest and shall be paid on the first business
of the seventh calendar month immediately following the month in which the
Participant’s separation from service occurred or, if earlier, upon the
Participant’s death.  “Termination of employment” or words of similar import, as
used in this Plan shall mean, with respect to any payments of deferred
compensation subject to Section 409A, the Participant’s “separation from
service” as defined in Section 409A.  In no event may the Participant, directly
or indirectly, designate the calendar year of payment.  If any payment of
deferred compensation subject to Section 409A is contingent on the Participant’s
delivery of a Release and the Release becoming effective, if the 60-day period
during which Participant must deliver the Release begins in one calendar year
and ends in another calendar year, then the payments subject to Section 409A
will occur or commence in the later year.  Nothing herein shall be construed as
a guarantee of any particular tax treatment to a Participant.  Each Participant
shall be solely responsible for the payment of all taxes that become due as a
result of a payment to the Participant under this Plan, and in no event shall
the Company or any Employer have any responsibility or liability if this Plan
does not meet any applicable requirements of Section 409A.
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ARTICLE VIII.  ERISA RIGHTS
 
As a participant in the Tempur-Pedic International Inc. Severance and Retention
Plan (the “Plan”), you are entitled to certain rights and protections under the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), which
provides that all Plan participants will be entitled to:

Receive information about your Plan and benefits:  Examine, without charge, at
the Plan Administrator’s office and at other specified locations, all documents
governing the Plan and a copy of the latest annual report filed by the Plan with
the U.S. Department of Labor, and available at the Public Disclosure Room of the
Employee Benefits Security Administration.

Obtain copies:  Upon written request to the Plan Administrator, copies of all
documents governing the operation of the Plan, and copies of the latest annual
report and updated summary plan description.  The Plan Administrator may make a
reasonable charge for the copies.

Summary Financial Report:  Receive a summary of the Plan’s annual financial
report.  The Plan Administrator is required by law to furnish each participant
with a copy of this summary annual report.

Prudent actions by the Plan fiduciaries:  In addition to creating rights for
Plan participants, ERISA imposes obligations upon the people who are responsible
for the operation of the Plan.  The people who operate the Plan, called
“fiduciaries” of the Plan, have a duty to do so prudently and in the interest of
you and other Plan participants and beneficiaries.  No one, including your
employer or any other person, may fire you or otherwise discriminate against you
in any way to prevent you from obtaining benefits or exercising your rights
under ERISA.

Enforce your rights:  If your claim for a benefit is denied or ignored, in whole
or in part, you have a right to know why this was done, to obtain copies of
documents relating to the decision without charge, and to appeal any denial, all
within certain time frames.  You have the right to have the Plan review and
reconsider your claim.  Under ERISA, there are steps you can take to enforce the
above rights.  For instance, if you request a copy of plan documents or the
latest annual report from the Plan Administrator and do not receive them within
thirty (30) days, you may file suit in a Federal court.  In such a case, the
court may require the Plan Administrator to provide the material and pay you up
to $110 a day until you receive the materials, unless the materials were not
sent because of reasons beyond the control of the Plan Administrator.  If you
have a claim for benefits which is denied or ignored, in whole or in part, you
may file suit in a state or Federal court in the United States subsequent to
exhausting the Plan’s claims procedures.  If it should happen that the Plan
fiduciaries misuse the Plan’s money, or if you are discriminated against for
asserting your rights, you may seek assistance from the U.S. Department of
Labor, or you may file suit in a Federal court.  The court will decide who
should pay court costs and legal fees.  If you are successful, the court may
order the person you have sued to pay these costs and fees.  If you lose, the
court may order you to pay these costs and fees, if it finds that your claim is
frivolous.
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Assistance with your questions:  If you have any questions about the Plan, you
should contact the Plan Administrator.  If you have any questions about this
statement or about your rights under ERISA, or if you need assistance in
obtaining documents from the Plan Administrator, you should contact the nearest
office of the Employee Benefits Security Administration, U.S. Department of
Labor, listed in your telephone directory, or the Division of Technical
Assistance and Inquiries, Employee Benefits Security Administration, U.S.
Department of Labor, 200 Constitution Avenue, NW Washington, D.C. 20210.  You
may also obtain certain publications about your rights and responsibilities
under ERISA by calling the publications hotline of the Employee Benefits
Security Administration.

ARTICLE IX.  GENERAL INFORMATION
 
Plan Sponsor:
Tempur Sealy International, Inc.
 
Plan Sponsor’s Employer Identification Number:
33-1022198
 
Plan Year:
January 1- December 31
 
Type of Welfare Plan:
The Plan is a separation pay plan.
 
Type of Administration:
The Plan is administered by the Committee.
 
Plan Number:
501
 
Plan Administrator:
The Plan is administered by the Committee.
 
Funding:
Benefits are provided from the general assets of the Employer.
 
Agent for Service of Legal Process:
Legal process may be served upon the Plan Administrator at the address specified
above.

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IN WITNESS WHEREOF, the Company, by its duly authorized officer acting in
accordance with a resolution duly adopted by the Board of Directors of the
Company, has executed this Plan on ____________, 2013, effective as of the
Effective Date.
 
 
Tempur Sealy International, Inc.
 
 
 
ATTEST:
By:

 
 
 
 
Its:

 
 
 
 
Date:  

 
 
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