EMPLOYMENT AND NON-COMPETITION AGREEMENT
(Jay Spenchian)

 
THIS EMPLOYMENT AND NON-COMPETITION AGREEMENT (the “Agreement”) is executed as
of this 18 day of November, 2014, and is effective as of December 1, 2014 (the
“Date of Hire”), by and between Tempur Sealy International, Inc., a Delaware
corporation (the “Company”), and Jay Spenchian, an individual (“Employee”).
 
    In consideration of the premises and the mutual agreements and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the Company and Employee,
 
IT IS HEREBY AGREED AS FOLLOWS:

ARTICLE I

EMPLOYMENT
 
1.1  Term of Employment.  Effective as of the Date of Hire, the Company agrees
to employ Employee, and Employee accepts employment by the Company, for the
period commencing on the Date of Hire and ending on the first anniversary of the
Date of Hire (the “Initial Term”), subject to earlier termination as hereinafter
set forth in Article III.  Unless earlier terminated in accordance with Article
III, following the expiration of the Initial Term, this Agreement shall be
automatically renewed for successive one-year periods (collectively, the
“Renewal Terms”; individually, a “Renewal Term”) unless, at least ninety (90)
days prior to the expiration of the Initial Term or the then current Renewal
Term, either party provides the other with a written notice of intention not to
renew, in which case the Employee’s employment with the Company, and the
Company’s obligations hereunder, shall terminate as of the end of the Initial
Term or said Renewal Term, as applicable.  Except as otherwise expressly
provided herein, the terms of this Agreement during any Renewal Term shall be
the same as the terms in effect immediately prior to such renewal, subject to
any such changes or modifications as mutually may be agreed between the parties
as evidenced in a written instrument signed by both the Company and Employee.

The expiration of the Agreement at the end of the Initial Term or any Renewal
Term by reason of the Company giving notice of nonrenewal pursuant to this
Section 1.1, other than if the Company specifies that the reason for the
non-renewal, and related termination of employment, otherwise qualifies as:

•
a “For Cause” termination pursuant to Section 3.1(c) or

•
a “Death or Disability” termination pursuant to Section 3.1(d)

shall be deemed a termination by the Company “without Cause” pursuant to Section
3.1(a) of this Agreement, and Employee shall be eligible to receive the benefits
set forth in Section 3.2(a).

 
1.2  Position and Duties.  Employee shall be employed in the position of
Executive Vice President, Chief Marketing Officer or such other executive
position as may be assigned from time to time by the Company’s Chief Executive
Officer; provided that any executive position that does not also include
continuing in the role of Chief Marketing Officer will require the consent of
the Employee.  In such capacity, Employee shall be subject to the authority of,
and shall report to, the Company’s Chief Operating Officer.  Employee’s duties
and responsibilities shall include those customarily attendant to Employee’s
position and such other duties and responsibilities as may be assigned from time
to time by the Chief Operations Officer.  Employee shall devote Employee’s
entire business time, loyalty, attention and energies exclusively to the
business interests of the Company while employed by the Company, and shall
perform his duties and responsibilities diligently and to the best of his
ability.
 
1.3  Other Documents.  On or prior to the Date of Hire the Employee will execute
and deliver to the Company the following:  Relocation Repayment Agreement and
Code of Business Conduct and Ethics and Policy on Insider Trading and
Confidentiality acknowledgements, each in the form previously furnished by the
Company.

ARTICLE II

COMPENSATION AND OTHER BENEFITS

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2.1  Base Salary.  The Company shall pay Employee an initial annual salary of
$440,000.00 (“Base Salary”), payable in accordance with the normal payroll
practices of the Company.  The Employee’s Base Salary will be reviewed and be
subject to adjustment from time to time by the Board of Directors or its
Compensation Committee at their discretion in accordance with the Company’s
annual review policy.  Based on the Company’s current policy, the Company
expects Employee’s first annual review would be during the first quarter of
2016.
 
2.2  Performance Bonus. Employee will be eligible to earn an annual
performance-based bonus based on performance criteria approved by the Company’s
Board of Directors or its Compensation Committee for each full or pro rata
portion of any fiscal year during which Employee is employed by the Company
commencing with 2015 (each, a “Bonus Year”), the terms and conditions of which
as well as Employee’s entitlement thereto being determined annually in the sole
discretion of the Company’s Board of Directors or its Compensation Committee
(the “Performance Bonus”).  The amount of the Performance Bonus will vary based
on the achievement of Company and individual performance criteria established by
the Company’s Board of Directors or its Compensation Committee, but the
performance criteria will be set to target a Performance Bonus equal to a
designated percentage of Base Salary as of December 31st of the applicable Bonus
Year if the performance criteria are met (the “Target Bonus”). The performance
criteria for Employee’s 2015 Performance Bonus will be determined in accordance
with the Company’s Annual Incentive Bonus Plan For Senior Executives, and the
performance criteria will be set to target a Performance Bonus equal to 65% of
Employee’s Base Salary. Unless otherwise provided under Section 3.2, Employee
shall not be eligible to receive payment of a Performance Bonus unless Employee
was employed by the Company on December 31st of the applicable Bonus Year.
 
2.3  Grant of Equity           

(a)           Pursuant to the Tempur Sealy International, Inc. 2013 Equity
Incentive Plan, as amended, effective as of the Date of Hire (for purposes of
this paragraph, the “Grant Date”) the Employee shall be granted an award (the
“Award”) of restricted stock units (the “RSUs”) each such RSU representing the
right to a share of the common stock, par value $0.01 per share, of the Company
(the “Stock”) having a grant date fair value equal to six hundred thousand
dollars ($600,000) on the date of grant, rounded up or down to the nearest whole
share. Such Award shall be made pursuant to and subject to the terms and
conditions of a Restricted Stock Unit Award Agreement between the Company and
Employee (“Award Agreement”) in the form attached hereto as Exhibit A. Subject
to the provisions of the Award Agreement, this Award shall vest in full on the
third anniversary of the Grant Date.

(b)           The Company expects that Employee will be considered for an
additional equity award in the first quarter of 2015 in accordance with the
Company’s normal executive compensation practices, and annually thereafter, but
the timing, amount and terms of any future grants will be subject to the
discretion of the Board of Directors or the Compensation Committee.

2.4  Hiring Bonus. As additional consideration for Employee’s agreement to
accept employment with the Company, the Company will pay to Employee a one-time
bonus of $636,765. This bonus is payable ninety (90) days after the Date of
Hire, provided that, as of the date payment would otherwise be made, the
Employee is considered an employee of the Company in good standing; and provided
further that in the event that, within twelve months of the Date of Hire,
Employee is terminated for Cause pursuant to paragraph 3.1(c) below, or resigns
his employment with the Company other than for Good Reason, Employee shall repay
to the Company the entire amount of the bonus described above within thirty (30)
days of the termination of Employee's employment.

2.5  Benefit Plans.  Employee will be eligible to participate in the Company’s
retirement plans that are qualified under Section 401(a) of the Internal Revenue
Code of 1986, as amended (the “Code”), and in the Company’s welfare benefit
plans that are generally applicable to all executive employees of the Company
(the “Plans”), in accordance with the terms and conditions thereof.  A brief
description of the Company’s current benefits is contained in Exhibit B hereto.

2.6  Automobile Allowance.  The Company shall pay to Employee an automobile
allowance of $600.00 per month.

2.7  Vacation.  Employee shall be entitled to three weeks (fifteen (15) days)
vacation days in the calendar year after the Date of Hire and three weeks
(fifteen days) at Employee’s one-year anniversary and each year thereafter,
subject to and to be taken in accordance with the Company’s general vacation
policies for similarly situated executive employees.

2.8  Relocation Benefits.  The Company will provide Employee with relocation
assistance in accordance with the policy and other provisions set forth in
Exhibit C.

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2.9  Expenses.  The Company shall reimburse Employee for all authorized and
approved expenses incurred in the course of the performance of Employee’s duties
and responsibilities pursuant to this Agreement and consistent with the
Company’s policies with respect to travel, entertainment and miscellaneous
expenses, and the requirements with respect to the reporting of such expenses.

2.10  Withholdings.  All payments to be made by the Company hereunder will be
subject to any withholding requirements.

ARTICLE III

TERMINATION

3.1  Right to Terminate; Automatic Termination.

(a)  Termination by Company Without Cause.  Subject to Section 3.2, the Company
may terminate Employee’s employment and all of the Company’s obligations under
this Agreement at any time and for any reason.

(b)  Termination by Employee for Good Reason.  Subject to Section 3.2, Employee
may terminate his employment obligation hereunder (but not his obligations under
Article IV hereof) for “Good Reason” (as hereinafter defined) if Employee gives
written notice thereof to the Company within thirty (30) days of the event he
deems to constitute Good Reason (which notice shall specify the grounds upon
which such notice is given) and the Company fails, within thirty (30) days of
receipt of such notice, to cure or rectify the grounds for such Good Reason
termination set forth in such notice.  “Good Reason” shall mean any of the
following:  (i) relocation of Employee’s principal workplace over sixty (60)
miles from the Company’s existing workplaces without the consent of Employee
(which consent shall not be unreasonably withheld, delayed or conditioned), or
(ii) the Company’s material breach of this Agreement or any other written
agreement between Employee and the Company which is not cured within thirty (30)
days after receipt by the Company from Employee of written notice of such
breach.

(c)  Termination by Company For Cause.  Subject to Section 3.2, the Company may
terminate Employee’s employment and all of the Company’s obligations under this
Agreement at any time “For Cause” (as defined below) by giving notice to
Employee stating the basis for such termination, effective immediately upon
giving such notice or at such other time thereafter as the Company may
designate.  “For Cause” shall mean any of the following:  (i) Employee’s willful
and continued failure to substantially perform the reasonably assigned duties
with the Company which are consistent with Employee’s position and job
description referred to in this Agreement, other than any such failure resulting
from incapacity due to physical or mental illness, after a written notice is
delivered to Employee by the Board of Directors of the Company which
specifically identifies the manner in which Employee has not substantially
performed the assigned duties and allowing Employee thirty (30) days after
receipt by Employee of such notice to cure such failure to perform,
(ii) material breach of this or any other written agreement between Employee and
the Company which is not cured within thirty (30) days after receipt by the
Employee from the Company of written notice of such breach, (iii) any material
violation of any written policy of the Company which is not cured within thirty
(30) days after receipt by Employee from the Company of written notice of such
violation, (iv) Employee’s willful misconduct which is materially and
demonstrably injurious to the Company, (v) Employee’s conviction by a court of
competent jurisdiction of, or his pleading guilty or nolo contendere to, any
felony, or (vi) Employee’s commission of an act of fraud, embezzlement, or
misappropriation against the Company or any breach of fiduciary duty or breach
of the duty of loyalty, including, but not limited to, the offer, payment,
solicitation or acceptance of any unlawful bribe or kickback with respect to the
Company’s business.  For purposes of this paragraph, no act, or failure to act,
on Employee’s part shall be considered “willful” unless done, or omitted to be
done, in knowing bad faith and without reasonable belief that the action or
omission was in, or not opposed to, the best interests of the Company.  Any act,
or failure to act, expressly authorized by a resolution duly adopted by the
Board of Directors or based upon the written advice of counsel for the Company
shall be conclusively presumed to be done, or omitted to be done, in good faith
and in the best interests of the Company.  Notwithstanding the foregoing,
Employee shall not be deemed to have been terminated For Cause unless and until
there shall have been delivered to Employee a copy of a resolution, duly adopted
by the Board of Directors at a meeting of the Board called and held for such
purpose (after reasonable notice to Employee and an opportunity for Employee,
together with Employee’s counsel, to be heard before the Board), finding that in
the good faith opinion of the Board of Directors Employee committed the conduct
set forth above in (i), (ii), (iii), (iv), (v) or (vi) of this Section and
specifying the particulars thereof in detail.

(d)  Termination Upon Death or Disability.  Subject to Section 3.2, Employee’s
employment and the Company’s obligations under this Agreement shall
terminate:  (i) automatically, effective immediately and without any notice
being necessary, upon Employee’s death; and (ii) in the event of the disability
of Employee, by the Company giving notice of termination to Employee.  For
purposes of this Agreement, “disability” means the inability of Employee, due to
a physical or

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mental impairment, for ninety (90) days (whether or not consecutive) during any
period of 360 days, to perform, with reasonable accommodation, the essential
functions of the work contemplated by this Agreement.  In the event of any
dispute as to whether Employee is disabled, the matter shall be determined by
the Company’s Board of Directors in consultation with a physician selected by
the Company’s health or disability insurer or another physician mutually
satisfactory to the Company and the Employee.  The Employee shall cooperate with
the efforts to make such determination or be subject to immediate
discharge.  Any such determination shall be conclusive and binding on the
parties.  Any determination of disability under this Section 3.1(d) is not
intended to alter any benefits any party may be entitled to receive under any
long-term disability insurance policy carried by either the Company or Employee
with respect to Employee, which benefits shall be governed solely by the terms
of any such insurance policy.  Nothing in this subsection shall be construed as
limiting or altering any of Employee’s rights under State workers compensation
laws or State or federal Family and Medical Leave laws.

3.2  Rights Upon Termination.

(a)  Section 3.1(a) and 3.1(b) Termination.  If Employee’s employment terminates
pursuant to Section 3.1(a) or 3.1(b) hereof, Employee shall have no further
rights against the Company hereunder, except for the right to receive, following
execution of a release and waiver in form satisfactory to the Company in the
case of clauses (ii), (iii) and (v) below, (i) any unpaid Base Salary and the
value of any accrued but unused vacation, (ii) a pro-rata portion of any
Performance Bonus that would be payable with respect to the Bonus Year in which
the termination occurs (based on the number of days of the Bonus Year prior to
the effective date of termination and the amount of the Target Bonus set by the
Board of Directors or Compensation Committee for the Employee for such Bonus
Year) and whatever rights to equity awards Employee may have pursuant to any
equity award agreements with the Company, (iii) payment of Base Salary for
twelve (12) months (the “Severance Period”), payable in accordance with the
normal practices of the Company, (iv) reimbursement of expenses to which
Employee is entitled under Section 2.9 hereof, and (v) continuation of the
welfare plans of the Company as detailed in Section 2.5 hereof for the duration
of the Severance Period.

(b)  Section 3.1(c) and 3.1(d) Terminations or Voluntary Resignation.  If
Employee’s employment is terminated pursuant to Sections 3.1(c) or 3.1(d)
hereof, or if Employee quits employment (other than for Good Reason)
notwithstanding the terms of this Agreement, Employee or Employee’s estate shall
have no further rights against the Company hereunder, except for the right to
receive, following execution of a release and waiver in form satisfactory to the
Company in the case of clause (iii) below, (i) any unpaid Base Salary, (ii) in
the case of Section 3.1(d) hereof, the value of any accrued but unused vacation,
(iii) in the case of Section 3.1(d) hereof, a pro-rata portion (based on the
number of days of the Bonus Year prior to the effective date of termination) of
any Performance Bonus that would be payable with respect to the Bonus Year in
which the termination occurs, and whatever rights as to equity awards as
Employee may have pursuant to the any equity award agreement with the Company
and (iv) reimbursement of expenses to which Employee is entitled under Section
2.9 hereof.
 

ARTICLE IV

CONFIDENTIALITY; NON-COMPETITION; NON-SOLICITATION

4.1  Covenants Regarding Confidential Information, Trade Secrets and Other
Matters.  Employee covenants and agrees as follows:

(a)  Definitions.  For purposes of this Agreement, the following terms are
defined as follows:

(1)  “Trade Secret” means all information possessed by or developed for the
Company or any of its subsidiaries, including, without limitation, a
compilation, program, device, method, system, technique or process, to which all
of the following apply:  (i) the information derives independent economic value,
actual or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use and (ii) the information is the subject of efforts to
maintain its secrecy that are reasonable under the circumstances.

(2)  “Confidential Information” means information, to the extent it is not a
Trade Secret, which is possessed by or developed for the Company or any of its
subsidiaries and which relates to the Company’s or any of its subsidiaries’
existing or potential business or technology, which information is generally not
known to the public and which information the Company or any of its subsidiaries
seeks to protect from disclosure to its existing or potential competitors or
others, including, without limitation, for example:  business plans, strategies,
existing or proposed bids, costs, technical developments, existing or proposed
research projects, financial or business projections, investments, marketing
plans, negotiation strategies, training information and materials, information
generated for client

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engagements and information stored or developed for use in or with
computers.  Confidential Information also includes information received by the
Company or any of its subsidiaries from others which the Company or any of its
subsidiaries has an obligation to treat as confidential.

(b)  Nondisclosure of Confidential Information.  Except as required in the
conduct of the Company’s or any of its subsidiaries’ business or as expressly
authorized in writing on behalf of the Company or any of its subsidiaries,
Employee shall not use or disclose, directly or indirectly, any Confidential
Information during the period of his employment with the Company.  In addition,
following the termination for any reason of Employee’s employment with the
Company, Employee shall not use or disclose, directly or indirectly, any
Confidential Information.  This prohibition does not apply to Confidential
Information after it has become generally known in the industry in which the
Company conducts its business.  This prohibition also does not prohibit
Employee’s use of general skills and know-how acquired during and prior to
employment by the Company, as long as such use does not involve the use or
disclosure of Confidential Information or Trade Secrets.

(c)  Trade Secrets.  During Employee’s employment by the Company, Employee shall
do what is reasonably necessary to prevent unauthorized misappropriation or
disclosure and threatened misappropriation or disclosure of the Company’s or any
of its subsidiaries’ Trade Secrets and, after termination of employment,
Employee shall not use or disclose the Company’s or any of its subsidiaries’
Trade Secrets as long as they remain, without misappropriation, Trade Secrets.

(d)  Copyright.  All copyrightable work by the Employee relating to the
Company’s business or the business of any subsidiary or affiliate of the Company
during the term of the Employee’s employment by the Company is intended to be
“work made for hire” as defined in Section 101 of the Copyright Act of 1976, and
shall be the property of the Company.  If the copyright to any such
copyrightable work is not the property of the Company by operation of law, the
Employee will, without further consideration, assign to the Company all right,
title and interest in such copyrightable work and will assist the Company and
its nominees in every way, at the Company’s expense, to secure, maintain and
defend for the Company’s benefit, copyrights and any extensions and renewals
thereof on any and all such work including translations thereof in any and all
countries, such work to be and remain the property of the Company whether
copyrighted or not.

(e)  Exceptions.  The provisions of paragraphs (b) and (c) above will not be
deemed to prohibit any disclosure that is required by law or court order,
provided that Employee has not intentionally taken actions to trigger such
required disclosure and the Company is given reasonable prior notice and an
opportunity to contest or minimize such disclosure.

4.2  Non-Competition.

(a)  During Employment.  During Employee’s employment hereunder, Employee shall
not engage, directly or indirectly, as an employee, officer, director, partner,
manager, consultant, agent, owner (other than a minority shareholder or other
equity interest of not more than 1% of a company whose equity interests are
publicly traded on a nationally recognized stock exchange or over-the-counter)
or in any other capacity, in any competition with the Company or any of its
subsidiaries.

(b)  Subsequent to Employment.  For a one year period following the termination
of Employee’s employment for any reason or without reason, Employee shall not in
any capacity (whether in the capacity as an employee, officer, director,
partner, manager, consultant, agent or owner (other than a minority shareholder
or other equity interest of not more than 1% of a company whose equity interests
are publicly traded on a nationally recognized stock exchange or
over-the-counter), directly or indirectly advise, manage, render or perform
services to or for any person or entity which is engaged in a business
competitive to that of the Company or any of its subsidiaries (including without
limitation those businesses listed in Appendix A to the form of Restricted Stock
Unit Award Agreement attached hereto as Exhibit A) within any geographical
location wherein the Company or any of its subsidiaries produces, sells or
markets its goods and services at the time of such termination or within a
one-year period prior to such termination.

4.3  Non-solicitation.  For a two year period following the termination of
Employee’s employment for any reason or without reason, Employee shall not
solicit or induce any person who was an employee of the Company or any of its
subsidiaries on the date of Employee’s termination or within three months prior
to leaving his employment with the Company or any of its subsidiaries to leave
their employment with the Company.

4.4  Return of Documents.  Immediately upon termination of employment, Employee
will return to the Company, and so certify in writing to the Company, all the
Company’s or any of its subsidiaries’ papers, documents and things, including
information stored for use in or with computers and software applicable to the
Company’s and its subsidiaries’ business (and all copies thereof), which are in
Employee’s possession or under Employee’s control, regardless whether such
papers, documents or things contain Confidential Information or Trade Secrets.

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4.5  No Conflicts.  To the extent that they exist, Employee will not disclose to
the Company or any of its subsidiaries any of Employee’s previous employer’s
confidential information or trade secrets.  Further, Employee represents and
warrants that Employee has not previously assumed any obligations inconsistent
with those of this Agreement and that employment by the Company does not
conflict with any prior obligations to third parties.  In addition, Employee and
the Company agree that it is important for any prospective employer to be aware
of this Agreement, so that disputes concerning this Agreement can be avoided in
the future.  Therefore, the Employee agrees that, following termination of
employment with the Company, the Company may forward a copy of Article IV of
this Agreement (and any related Exhibits hereto) to any future prospective or
actual employer, and the Employee releases the Company from any claimed
liability or damage caused to the Employee by virtue of the Company’s act in
making that prospective or actual employer aware of Article IV of this Agreement
(and any related Exhibits hereto).

4.6  Agreement on Fairness.  Employee acknowledges that:  (i) this Agreement has
been specifically bargained between the parties and reviewed by Employee, (ii)
Employee has had an opportunity to obtain legal counsel to review this
Agreement, and (iii) the covenants made by and duties imposed upon Employee
hereby are fair, reasonable and minimally necessary to protect the legitimate
business interests of the Company, and such covenants and duties will not place
an undue burden upon Employee’s livelihood in the event of termination of
Employee’s employment by the Company and the strict enforcement of the covenants
contained herein.

4.7  Equitable Relief and Remedies.  Employee acknowledges that any breach of
this Agreement will cause substantial and irreparable harm to the Company for
which money damages would be an inadequate remedy.  Accordingly, notwithstanding
the provisions of Article V below, the Company shall in any such event be
entitled to seek injunctive and other forms of equitable relief to prevent such
breach and the prevailing party shall be entitled to recover from the other, the
prevailing party’s costs (including, without limitation, reasonable attorneys’
fees) incurred in connection with enforcing this Agreement, in addition to any
other rights or remedies available at law, in equity, by statute or pursuant to
Article V below.

ARTICLE V

AGREEMENT TO SUBMIT ALL EXISTING OR FUTURE DISPUTES
TO BINDING ARBITRATION

The Company and Employee agree that any controversy or claim arising out of or
related to this Agreement or Employee’s employment with or termination by the
Company that is not resolved by the parties shall be settled by arbitration
administered by the American Arbitration Association under its National Rules
for the Resolution of Employment Disputes.  Said arbitration shall be conducted
in Lexington, Kentucky.  The parties further agree that the arbitrator may
resolve issues of contract interpretation as well as law and award damages, if
any, to the extent provided by the Agreement or applicable law.  The parties
agree that the costs of the arbitrator’s services shall be borne by the
Company.  The parties further agree that the arbitrator’s decision will be final
and binding and enforceable in any court of competent jurisdiction.  In addition
to the A.A.A.’s Arbitration Rules and unless otherwise agreed to by the parties,
the following rules shall apply:

(a)  Each party shall be entitled to discovery under the Federal Rules of Civil
Procedure exclusively by the following means:  (i) requests for admission, (ii)
requests for production of documents, (iii) up to fifteen (15) written
interrogatories (with any subpart to be counted as a separate interrogatory),
and (iv) depositions of no more than six individuals.

(b)  Unless the arbitrator finds that delay is reasonably justified or as
otherwise agreed to by the parties, all discovery shall be completed, and the
arbitration hearing shall commence within five months after the appointment of
the arbitrator.

(c)  Unless the arbitrator finds that delay is reasonably justified, the hearing
will be completed, and an award rendered within thirty (30) days of commencement
of the hearing.

The arbitrator’s authority shall include the ability to render equitable types
of relief and, in such event, any aforesaid court may enter an order enjoining
and/or compelling such actions or relief ordered or as found by the
arbitrator.  The arbitrator also shall make a determination regarding which
party’s legal position in any such controversy or claim is the more
substantially correct (the “Prevailing Party”) and the arbitrator shall require
the other party to pay the legal and other professional fees and costs incurred
by the Prevailing Party in connection with such arbitration proceeding and any
necessary court action.

Notwithstanding the foregoing provisions of this Article V, the parties
expressly agree that a court of competent jurisdiction may enter a temporary
restraining order or an order enjoining a breach of Article IV of this Agreement
without prior submission

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of the underlying dispute to an arbitrator.  Such remedy shall be cumulative and
nonexclusive, and shall be in addition to any other remedy to which the parties
may be entitled.

ARTICLE VI

GENERAL PROVISIONS

6.1  Notices.  Any and all notices provided for in this 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 the address
designated below for such party as follows (or to such other address for such
party as such party may have substituted by notice pursuant to this Section
6.1):

(a) If to the Company:  

Tempur Sealy International, Inc.
1000 Tempur Way
Lexington, KY 40511
Attention: Chief Executive Officer
With a copy to Executive Vice President and General Counsel

(b) If to Employee:  

Jay Spenchian
790 Pinetree Rd.
Winter Park, FL 32789

6.2  Entire Agreement.  This Agreement, together with the exhibits hereto,
contains the entire understanding and the full and complete agreement of the
parties and supersedes and replaces any prior understandings and agreements
among the parties with respect to the subject matter hereof. The provisions of
this Agreement shall survive the termination of the Agreement, or of Employee’s
employment for any reason, to the extent necessary to enable the parties to
enforce their respective rights.

6.3  Miscellaneous.  This Agreement may be altered, amended or modified only in
a writing signed by both of the parties hereto, except that either party may
update its address set forth in Section 6.1 by providing a Notice of the updated
address in the manner set forth in Section 6.1.  Headings included in this
Agreement are for convenience only and are not intended to limit or expand the
rights of the parties hereto.  References to Sections herein shall mean sections
of the text of this Agreement, unless otherwise indicated.

6.4  Assignability.  This Agreement and the rights and duties set forth herein
may not be assigned by either of the parties without the express written consent
of the other party.  This Agreement shall be binding on and inure to the benefit
of each party and such party’s respective heirs, legal representatives,
successors and assigns.

6.5  Severability.  If any court of competent jurisdiction determines that any
provision of this Agreement is 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
such invalid or unenforceable provision shall be construed in a manner so as to
give the maximum valid and enforceable effect to the intent of the parties
expressed therein.

6.6  Waiver of Breach.  The waiver by either party of the breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by either party.

6.7  Governing Law; Jurisdiction; Construction.  This Agreement shall be
governed by the internal laws of the Commonwealth of Kentucky, without regard to
any rules of construction that would require application of the laws of another
jurisdiction.  Any legal proceeding related to this Agreement and permitted
under Section 4.7 and Article V hereof must be litigated in an appropriate
Kentucky state or federal court, and both the Company and the Employee hereby
consent to the exclusive jurisdiction of the Commonwealth of Kentucky for this
purpose.  The parties agree that they have been represented by counsel during
the negotiation and execution of this Agreement, and accordingly each party
waives the application of any law, holding

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or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party responsible for the drafting
thereof.

6.8.  Effective Date.  The terms and conditions of this Agreement shall be
effective as of the Date of Hire.  In the event of the failure of Employee to
commence his employment with the Company (or at such other date as the Employee
and the Company may mutually agree), this Agreement shall be null and void and
of no force or effect.

6.9.  Tax Compliance.

(a)  The Company may withhold from any amounts payable hereunder any amounts
required to be withheld under federal, state or local law and any other
deductions authorized by Employee.  The Company and the Employee agree that they
will execute any and all amendments to this Agreement as they mutually agree in
good faith may be necessary to ensure compliance with the provisions of Section
409A (together with any implementing regulations, “Section 409A”) of the Code
while preserving insofar as possible the economic intent of the respective
provisions, so that Employee will not be subject to any tax (including interest
and penalties) under Section 409A.
 
(b)  For purposes of Section 409A, the right to a series of installment payments
under this Agreement shall be treated as a right to a series of separate
payments.
 
(c)  With respect to any reimbursement of expenses of, or any provision of
in-kind benefits to, the Employee, as specified under this Agreement, such
reimbursement of expenses or provision of in-kind benefits shall be subject to
the following conditions: (1) the expenses eligible for reimbursement or the
amount of in-kind benefits provided in one taxable year shall not affect the
expenses eligible for reimbursement or the amount of in-kind benefits provided
in any other taxable year, except for any medical reimbursement arrangement
providing for the reimbursement of expenses referred to in Section 105(b) of the
Code; (2) the reimbursement of an eligible expense shall be made no later than
the end of the year after the year in which such expense was incurred; and (3)
the right to reimbursement or in-kind benefits shall not be subject to
liquidation or exchange for another benefit.

(d)  Notwithstanding anything to the contrary in this Agreement, if Employee is
a “specified employee” as determined pursuant to Section 409A as of the date of
Employee’s “separation from service” as defined in Treasury Regulation Section
1.409A-1(h) (or any successor regulation) and if any payments or entitlements
provided for in this Agreement constitute a “deferral of compensation” within
the meaning of Section 409A and cannot be paid or provided in the manner
provided herein without subjecting Employee to additional tax, interest or
penalties under Section 409A, then any such payment or entitlement which is
payable during the first six months following Employee’s “separation from
service” shall be paid or provided to Employee in a cash lump-sum on the first
business day of the seventh calendar month immediately following the month in
which Employee’s “separation from service” occurs or, if earlier, upon the
Employee’s death.  In addition, any payments or benefits due hereunder upon a
termination of Employee’s employment which are a “deferral of compensation”
within the meaning of Section 409A shall only be payable or provided to Employee
(or Employee’s estate) upon a “separation from service” as defined in Section
409A.  Finally, for the purposes of this Agreement, amounts payable under
Section 3.2 shall be deemed not to be a “deferral of compensation” subject to
Section 409A to the extent provided in the exceptions in Treasury Regulation
Sections 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9) (“separation pay
plans,” including the exception under subparagraph (iii)) and other applicable
provisions of Treasury Regulation Section 1.409A-1 - A-6.

6.10    Indemnification; Insurance Coverage.  The Company’s By-Laws, as may be
amended from time to time, provides to directors and executive officers of the
Company certain rights to indemnification by the Company and to directors’ and
officers’ insurance coverage.  The Employee shall be entitled to the same level
of protection provided to executive officers, as contemplated in the Company’s
By-Laws, as may be amended from time to time.  

[Remainder of Page Intentionally Left Blank]

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year written above.

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COMPANY:

TEMPUR SEALY INTERNATIONAL, INC.

By:    /s/ Brad Patrick                                                  
Title: EVP/Chief Human Resources Officer    

EMPLOYEE:

  /s/ Jay Spenchian                                                         
Jay Spenchian

WITNESSED BY:

  /s/ Rachel Wheeler                                             

Date:    11/18/14                                                  

Exhibits:

Exhibit A                      Form of Restricted Stock Unit Award Agreement
Exhibit B                      2015 U.S. Benefits Guide
Exhibit C                      Executive Relocation Program Guide