Document:

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                      MATTRESS HOLDINGS INTERNATIONAL, LLC

                       LIMITED LIABILITY COMPANY AGREEMENT
                          ----------------------------

                            DATED AS OF JUNE 30, 1999

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT
OR AN EXEMPTION FROM REGISTRATION THEREUNDER.

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS INSTRUMENT ARE ALSO SUBJECT TO
ADDITIONAL RESTRICTIONS ON TRANSFERABILITY AS SET FORTH IN THIS AGREEMENT.

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                               Table of Contents

                                                               Page
                                                               ----
ARTICLE 1  GENERAL                                              1
1.1   Definitions............................................   1
1.2   Construction...........................................   5

ARTICLE 2  ORGANIZATION                                         5
2.1   Formation..............................................   5
2.2   Name                                                      5
2.3   Registered Office; Agent...............................   5
2.4   Term                                                      6
2.5   Purpose; Powers........................................   6
2.6   Execution of Documents.................................   6

ARTICLE 3  MEMBERSHIP                                           6
3.1   Units Generally; Membership Interests..................   6
3.2   Authorization and Issuance of Units....................   6
3.3   Issuance of Units......................................   7
3.4   New Members from the Issuance of Membership Interests..   7

ARTICLE 4  CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS           7
4.1    Capital Contributions.................................   7
4.2    Capital Accounts......................................   8
4.3    Negative Capital Accounts.............................   9
4.4    No Withdrawal.........................................  10
4.5    Loans From Members....................................  10
4.6    Status of Capital Contributions.......................  10

ARTICLE 5  ALLOCATIONS OF PROFITS AND LOSSES                   10
5.1    Allocation of Profits and Losses......................  10
5.2    Regulatory and Special Allocations....................  10
5.3    Curative Allocations..................................  11
5.4    Tax Allocations.......................................  12

ARTICLE 6  DISTRIBUTIONS                                       13
6.1    Generally.............................................  13
6.2    Distributions.........................................  13

ARTICLE 7  MANAGEMENT OF THE COMPANY                           13
7.1    Officers of the Company...............................  13
7.2    Performance of Duties; Liability of Officers..........  14
7.3    Indemnification.......................................  15

ARTICLE 8  MEMBERS; VOTING RIGHTS                              15
8.1    Voting Rights.........................................  15

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8.2    Withdrawal; Resignation...............................  15
8.3    Authority.............................................  15
8.4    Limitation of Liability...............................  15

ARTICLE 9  TRANSFER OF MEMBERSHIP INTERESTS                    16
9.1    Restrictions..........................................  16
9.2    General Restrictions on Transfer......................  16
9.3    Procedure for Transfers...............................  16
9.4    Limitations...........................................  17

ARTICLE 10  DISSOLUTION AND LIQUIDATION                        17
10.1   Dissolution...........................................  17
10.2   Liquidation...........................................  18

ARTICLE 11  GENERAL/MISCELLANEOUS PROVISIONS                   19
11.1   Notices...............................................  19
11.2   Governing Law.........................................  19
11.3   Entire Agreement......................................  19
11.4   Amendment or Modification.............................  19
11.5   Binding Effect........................................  20
11.6   Counterparts..........................................  20
11.7   Severability..........................................  20
11.8   Headings..............................................  20
11.9   Parties in Interest...................................  20
11.10  Further Assurances....................................  20
11.11  No Strict Construction................................  20
11.12  Time of the Essence; Computation of Time..............  20

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                      MATTRESS HOLDINGS INTERNATIONAL, LLC

                       LIMITED LIABILITY COMPANY AGREEMENT
                       -----------------------------------

          This LIMITED LIABILITY COMPANY AGREEMENT of MATTRESS  HOLDINGS
INTERNATIONAL, LLC (the "Company") is made as of June 30, 1999, by and among
each of the Persons executing this Agreement and listed on the Members Schedule
(as herein defined).

          WHEREAS, the Members wish to form a limited liability company pursuant
to the Delaware Limited Liability Company Act, Delaware Code, Title 6, Sections
18-101, et seq., as amended from time to time (the "Delaware Act"), by having a
Certificate of Formation of the Company (the "Certificate of Formation") filed
with the Secretary of State of the State of Delaware and entering into this
Agreement.

          NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein made and other good and valuable consideration, the Members
hereby agree as follows:

                                 ARTICLE 1

                                 GENERAL

     1.1  Definitions. For purposes of this Agreement, the following terms
shall have the following meanings:

          "Adjusted Capital Account Deficit" means, with respect to any Member,
the deficit balance, if any, in such Member's Capital Account as of the end of
the relevant Taxable Year, after giving effect to the following adjustments:

          (i) Crediting to such Capital Account any amount which such Member is
     obligated to restore or is deemed to be obligated to restore pursuant to
     Treasury Regulation Sections 1.704-1(b)(2)(ii)(c), 1.704-2 (g)(1), and
     1.704-2(i); and

          (ii) Debiting to such Capital Account the items described in Treasury
     Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

          "Agreement" means this Limited Liability Company Agreement, as
originally executed and as may be amended, modified, supplemented or restated
from time to time.

          "Bain" means Bain Capital, Inc., a Delaware corporation.

          "Bain Securities Purchase Agreement" means the Securities Purchase
Agreement, dated as of the date hereof, between the Company and Bain.

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          "Bankruptcy" means, with respect to a Member, (i) that such Member has
(A) made an assignment for the benefit of creditors, (B) filed a voluntary
petition in bankruptcy, (C) been adjudged bankrupt or insolvent, or had entered
against such Member an order of relief in any bankruptcy or insolvency
proceeding, (D) filed a petition or an answer seeking for such Member any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation or filed an answer or
other pleading admitting or failing to contest the material allegations of a
petition filed against such Member in any proceeding of such nature, or (E)
sought, consented to, or acquiesced in the appointment of a trustee, receiver or
liquidator of such Member or of all or any substantial part of such Member's
properties; (ii) 120 days have elapsed after the commencement of any proceeding
against such Member seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any statute, law
or regulation and such proceeding has not been dismissed; or (iii) 90 days have
elapsed since the appointment without such Member's consent or acquiescence of a
trustee, receiver or liquidator of such Member or of all or any substantial part
of such Member's properties and such appointment has not been vacated or stayed
or the appointment is not vacated within 90 days after the expiration of such
stay.

          "Book Value" means, with respect to any Company property, the
Company's adjusted basis for federal income tax purposes, adjusted from time to
time to reflect the adjustments required or permitted by Treasury Regulation
Section 1.704-1(b)(2)(iv)(d)--(g); provided that the Book Value of each asset of
the Company shall be adjusted as of the date of any Capital Contribution
pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(f) in a manner
determined by the President or Secretary of the Company so that the aggregate
Book Value of the Company's assets (net of the Company's liabilities) as of such
date is equal to the aggregate initial Capital Account balances of the Members
(immediately after the Member's Capital Contribution is made).

          "Capital Account" means the capital account maintained for a Member
pursuant to Section 4.2.

          "Capital Contribution" means the cash and/or agreed fair market value
of any asset or property of any nature contributed by a Member to the Company
with respect to the Membership Interests held by such Member.

          "Certificate" means the Certificate of Formation, as such Certificate
of Formation may be amended, supplemented or restated from time to time.

          "Class A Common Unit" means a Unit having the rights and obligations
specified with respect to Class A Common Units in this Agreement.

          "Class B Common Unit" means a Unit having the rights and obligations
specified with respect to Class B Common Units in this Agreement.

          "Code" means the Internal Revenue Code of 1986, as amended from time
to time.

          "Common Units" means collectively the Class A Common Units and the
Class B Common Units.

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          "Company Minimum Gain" has the meaning set forth for "partnership
minimum gain" in Treasury Regulation Section 1.704-2(d).

          "Contributed Capital Account" means, with respect to any Member at any
time, the aggregate amount of Capital Contributions that such Member has
theretofore contributed to the Company pursuant to Section 4.1.

          "Liquidating Distribution" means any distribution pursuant to Section
10.2 hereof.

          "Majority in Interest" means, as applied to all of the Members,
Members whose Pro Rata Voting Percentages, in the aggregate, constitute more
than 50% of the Pro Rata Voting Percentages of all of the Members.

          "Member Minimum Gain" with respect to each Member Nonrecourse Debt,
means the amount of Company Minimum Gain (as determined according to Treasury
Regulation Section 1.704-2(d)(1)) that would result if such Member Nonrecourse
Debt were treated as a nonrecourse liability, determined in accordance with
Treasury Regulation Section 1.704-2(i)(3).

          "Member Nonrecourse Debt" has the meaning set forth in Treasury
Regulation Section 1.704-2(b)(4), substituting the term "Company" for the term
"partnership" and the term "Member" for the term "partner" as the context
requires.

          "Member Nonrecourse Deduction" has the meaning set forth in Treasury
Regulation Section 1.704-2(i), substituting the term "Member" for the term
"partner" as the context requires.

          "Members" means each Person identified on the Members Schedule as of
the date hereof who has executed this Agreement or a counterpart hereof and each
Person who may hereafter be admitted as a Member in accordance with the terms of
this Agreement.  The Members shall constitute the "members" (as that term is
defined in the Delaware Act) of the Company.

          "Membership Interest" means the entire interest of a Member (a) to a
distributive share of Profits, Losses, and other items of income, gain, loss,
deduction and credits of the Company, (b) to a distributive share of the assets
of the Company, (c) to vote on, consent to or otherwise participate in any
decision of the Members, and (d) to any and all other benefits to which such
Member may be entitled as provided in this Agreement or the Delaware Act.

          "Nonrecourse Deductions" has the meaning set forth in Treasury
Regulation Section 1.704-2(b) (substituting the term "Company" for the term
"partnership" as the context requires).

          "Nonvoting Units" means the Class B Common Units.

          "Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, a governmental entity or any
department, agency or political subdivision thereof or any other entity or
organization.

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          "Pro Rata Percentage" means, with respect to any Member, the
percentage determined by dividing the number of Common Units held by that Member
by the aggregate number of Common Units held by all Members.

          "Pro Rata Voting Percentage" means, with respect to any Member, the
percentage determined by dividing the number of Class A Common Units held by
that Member by the aggregate number of Class A Common Units held by all Members.

          "Sealy" means Sealy, Inc., an Ohio corporation.

          "Sealy Credit Agreement" means credit agreement and/or other agreement
or document pursuant to which debt financing is provided to Sealy and/or any of
its subsidiaries, as well as any pledge agreement executed in connection
therewith.

          "Sealy Securities Purchase Agreement" means the Securities Purchase
Agreement, dated as of the date hereof, between the Company and Sealy.

          "Securities Act" means the Securities Act of 1933, as amended from
time to time.

          "Taxable Year" means the Company's taxable year ending on the Sunday
closest to November 30 (or part thereof in the case of the Company's first and
last taxable year), or such other year as is (i) required by Section 706 of the
Code or (ii) determined by the President or Secretary of the Company (if no year
is so required by Section 706 of the Code).

          "Transfer" means any direct or indirect sale, transfer, conveyance,
assignment, pledge, hypothecation, gift, delivery or other disposition; provided
that, notwithstanding anything contained herein to the contrary, the pledge by
Sealy of Units owned by Sealy pursuant to the terms of the Sealy Credit
Agreement shall not be in a "Transfer" for purposes of this Agreement, but any
actual transfer of title pursuant to such pledge shall be a "Transfer" for
purposes of this Agreement.

          "Treasury Regulations" shall mean, except where the context indicates
otherwise, the final, temporary, proposed, or proposed and temporary regulations
of the Department of the Treasury under the Code as such regulations may be
lawfully changed from time to time.

          "Unit" means a fractional part of a Membership Interest, as provided
in this Agreement.

          "Voting Units" means the Class A Common Units.

     1.2 Construction. Whenever the context requires, the gender of all words
used in this Agreement includes the masculine, feminine and neuter and the
singular number includes the plural number and vice versa. All references to
Articles and Sections refer to articles and sections of this Agreement, and all
references to Schedules are to Schedules attached hereto, each of which is made
a part hereof for all purposes.

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                                    ARTICLE 2

                                  ORGANIZATION

     2.1  Formation.

          (a) The Certificate of Formation was prepared, executed and filed with
the Secretary of State of the State of Delaware on June 21, 1999, by Cindy
Rashed, as an "authorized person" for such purpose within the meaning of the
Delaware Act, all of which is hereby authorized and ratified in all respects.
The Members hereby constitute the existence of the Company under this Agreement
and the Delaware Act.  The rights, powers, duties, obligations and liabilities
of the Members shall be determined pursuant to the Delaware Act and this
Agreement.  To the extent that the rights, powers, duties, obligations and
liabilities of any Member are different by reason of any provision of this
Agreement than they would be in the absence of such provision, this Agreement
shall, to the extent permitted by the Delaware Act, control.

          (b) Any officer of the Company as an "authorized person" within the
meaning of the Delaware Act, shall, at any time he becomes aware that any
statement in the Certificate was false when made, or that any matter described
therein has changed making the Certificate false in any material respect,
promptly execute, deliver and file any and all amendments thereto and
restatements thereof in accordance with the Delaware Act.

          (c) At the time the Company has more than one Member, the Company
shall be treated as a partnership for federal, foreign and, if applicable, state
and local income tax purposes, and each Member and the Company shall file all
tax returns and shall otherwise take all tax and financial reporting positions
in a manner consistent with such treatment.  The Company shall not be deemed a
partnership or joint venture for any other purpose.

     2.2  Name. The name of the limited liability company constituted by this
Agreement is Mattress Holdings International, LLC or such other name or names as
the President or Secretary of the Company may from time to time designate;
provided, that the name shall always contain the words "Limited Liability
Company", "LLC" or "L.L.C."

     2.3  Registered Office; Agent. The Company shall maintain a registered
office in the State of Delaware at c/o Corporation Service Company, 1013 Centre
Road, Wilmington, New Castle County, Delaware 19805 or at such other place
within Delaware as the President or Secretary of the Company may designate.  The
name and address of the Company's registered agent for service of process on the
Company in the State of Delaware is Corporation Service Company, 1013 Centre
Road, Wilmington, New Castle County, Delaware 19805 or such other agent as the
President or Secretary of the Company may from time to time designate.

     2.4  Term. The term of the Company shall continue perpetually unless
terminated in accordance with the provisions of this Agreement.

     2.5  Purpose; Powers. The purposes and character of the business of the
Company shall be to transact any or all lawful business for which limited
liability companies may be organized under the Delaware Act.  The Company shall
have any and all powers which are necessary or desirable to carry out the
purposes and business of the Company, to the extent the same may be legally
exercised by limited liability companies under the Delaware Act.  The Company
shall carry

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out the foregoing activities pursuant to the arrangements set forth in this
Agreement. Notwithstanding anything herein to the contrary, nothing set forth
herein shall be construed as authorizing the Company to possess any purpose or
power, or to do any act or thing, forbidden by law to a limited liability
company organized under the laws of the State of Delaware.

     2.6  Execution of Documents. On June 22, 1999, E. Lee Wyatt, as an
"authorized person" of the Company, executed, on behalf of the Company, that
certain Stock Purchase Agreement ("Purchase Agreement"), between the Company and
Malachi Mattress America, Inc., a Delaware corporation ("MMA"), pursuant to
which the Company agreed to purchase common stock and preferred stock of MMA,
all of which is hereby authorized and ratified in all respects.  On June 28,
1999, Kenneth L. Walker, as an "authorized person" of the Company, executed, on
behalf of the Company, that certain the Stockholders Agreement, between MMA, the
Company and the other stockholders of MMA, and other documents contemplated by
the Purchase Agreement, all of which is hereby authorized and ratified in all
respects.

                                 ARTICLE 3

                                 MEMBERSHIP

     3.1  Units Generally; Membership Interests. The Membership Interests of
the Members shall be represented by issued and outstanding Units, which may be
divided into one or more types of classes, with each type or class having the
rights and privileges, including voting rights, if any, set forth in this
Agreement.  As of the date hereof, the Members of the Company are the Persons
whose names are set forth on the signature pages hereto and listed on the
Members Schedule (as herein defined) as in effect on the date hereof.  The
Secretary of the Company shall maintain a schedule of all Members from time to
time, their respective mailing addresses, the Contributed Capital Account, the
number and class of Common Units, and the Pro Rata Percentages for each such
Member (as the same may be amended, modified or supplemented from time to time,
the "Members Schedule"), a copy of which as of the date hereof is attached
hereto as Schedule A.  The Members shall have no interest in the Company other
than the interests conferred by this Agreement.

     3.2  Authorization and Issuance of Units.

          (a) Class A Common Units. The Company hereby authorizes the issuance
of Class A Common Units; 10 of which are outstanding as of the date hereof as
set forth on the Members Schedule (as in effect on the date hereof).

          (b) Class B Common Units. The Company hereby authorizes the issuance
of Class B Common Units; 273,900 of which are outstanding as of the date hereof
as set forth on the Members Schedule (as in effect on the date hereof).

          (c) Additional Units. Except as expressly provided by this Agreement,
the Company shall not authorize, issue or sell, or cause to be authorized,
issued or sold, any Units.

     3.3  Issuance of Units. Subject to the limitations contained in Section
9.4 hereof, the Company (with the approval of the Board) shall have the right to
issue any authorized but unissued

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Units; provided, that the Company shall not issue any Units to any Person who is
not then a Member unless such Person has executed and delivered to the Secretary
of the Company the documents described in Section 3.4 hereof. Upon the issuance
of Units, the Board shall adjust the Capital Accounts of the Members as
necessary in accordance with Section 4.2.

     3.4  New Members from the Issuance of Membership Interests. After the
date hereof, in order for a Person to be admitted as a Member of the Company
pursuant to the issuance of Membership Interests to such Person such Person
shall have executed and delivered to the Secretary of the Company a written
undertaking to be bound by the terms and conditions of this Agreement
substantially in the form of Exhibit A hereto.  Upon the amendment of the
Members Schedule by the Secretary of the Company and the satisfaction of any
other applicable conditions, including the receipt by the Company of payment for
the issuance of the applicable Membership Interests, such Person shall be
admitted as a Member and deemed listed as such on the books and records of the
Company and thereupon shall be issued his or its Membership Interests.  The
Board shall also adjust the Capital Accounts of the Members as necessary in
accordance with Section 4.2.

                                 ARTICLE 4

                   CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS

     4.1  Capital Contributions.

          (a) Contemporaneously with the execution of this Agreement:

               (i) Bain, a Member of the Company, has made a Capital
          Contribution to the Company in the amount of $1,000, which is such
          Member's Contributed Capital Account as of the date hereof, and Bain
          has received in exchange for such Capital Contribution 10 Class A
          Common Units which represents an initial Pro Rata Percentage of
          0.00365%, all of which is set forth on the Members Schedule as of the
          date hereof.  As set forth in the Bain Securities Purchase Agreement,
          such Capital Contribution consists of cash in the amount of $1,000.

               (ii) Sealy, a Member of the Company, has made a Capital
          Contribution to the Company in the amount of $27,390,000, which is
          such Member's Contributed Capital Account as of the date hereof, and
          Sealy has received in exchange for such Capital Contribution 273,900
          Class B Common Units which represents an initial Pro Rata Percentage
          of 99.99635%, all of which is set forth on the Members Schedule as of
          the date hereof.  As set forth in the Sealy Securities Purchase
          Agreement, such Capital Contribution consists of cash in the amount of
          $27,390,000.

          (b) No Member shall make or be required to make any additional Capital
Contributions to the Company with respect to such Member's Units.  Except as
expressly provided herein, no Member, in its capacity as a Member, shall have
the right to receive any other cash or any property of the Company.

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     4.2  Capital Accounts.

          (a) Maintenance Rules. The Company shall maintain for each Member a
separate capital account (a "Capital Account") in accordance with this Section
4.2(a).  Each Capital Account shall be maintained in accordance with the
following provisions:

               (i) Such Capital Account shall be increased by the cash amount or
          Book Value of any property contributed by such Member to the Company
          pursuant to this Agreement, such Member's allocable share of Profits
          and any items in the nature of income or gains which are specially
          allocated to such Member pursuant to Section 5.2 or Section 5.3, and
          the amount of any liabilities of the Company assumed by such Member or
          which are secured by any property distributed to such Member.

               (ii) Such Capital Account shall be decreased by the cash amount
          or Book Value of any property distributed to such Member pursuant to
          this Agreement, such Member's allocable share of Losses and any items
          of in the nature of deductions or losses which are specially allocated
          to such Member pursuant to Section 5.2 or Section 5.3, and the amount
          of any liabilities of such Member assumed by the Company or which are
          secured by any property contributed by such Member to the Company.

               (iii)  If all or any portion of a Membership Interest is
          Transferred in accordance with the terms of this Agreement, the
          transferee shall succeed to the Capital Account, the Contributed
          Capital Account and the Pro Rata Percentages of the transferor to the
          extent it relates to the transferred Membership Interest.

               (iv) If a new or existing Member contributed money or property to
          the Company (other than a de minimis amount as determined by the
          Board) as consideration for the issuance by the Company of any Units
          after the date hereof, the Capital Accounts of the Members shall be
          adjusted in accordance with Treasury Regulation Section 1.704-
          1(b)(2)(iv)(f).

The foregoing provisions and the other provisions of this Agreement relating to
the maintenance of Capital Accounts are intended to comply with Section 1.704-
1(b) of the Treasury Regulations and shall be interpreted and applied in a
manner consistent with such Treasury Regulations.  If the President or Secretary
of the Company determines that it is prudent to modify the manner in which the
Capital Accounts, or any increases or decreases to the Capital Accounts, are
computed in order to comply with such Treasury Regulations, the President or
Secretary of the Company may authorize such modifications.

          (b) Definition of Profits and Losses. "Profits" and "Losses" mean,
for each Taxable Year or other period, an amount equal to the Company's taxable
income or loss for such Taxable Year or other period, determined in accordance
with Code Section 703(a) (for this purpose, all items of income, gain, loss or
deduction required to be stated separately pursuant to Code Section 703(a)(1)
shall be included in taxable income or loss), with the following adjustments:

                  (i) The computation of all items of income, gain, loss and
          deduction shall include tax-exempt income and those items described in
          Treasury Regulation

                                      -8-
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          Section 1.704-1(b)(2)(iv)(i), without regard to the fact that such
          items are not includable in gross income or are not deductible for
          federal income tax purposes.

                  (ii) If the Book Value of any Company property is adjusted
          pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(e) or (f),
          the amount of such adjustment shall be taken into account as gain or
          loss from the disposition of such property.

                  (iii)  Items of income, gain, loss or deduction attributable
          to the disposition of Company property having a Book Value that
          differs from its adjusted basis for tax purposes shall be computed by
          reference to the Book Value of such property.

                  (iv) Items of depreciation, amortization and other cost
          recovery deductions with respect to Company property having a Book
          Value that differs from its adjusted basis for tax purposes shall be
          computed by reference to the property's Book Value in accordance with
          Treasury Regulation Section 1.704-1(b)(2)(iv)(g).

                  (v) To the extent an adjustment to the adjusted tax basis of
          any Company property pursuant to Code Sections 732(d), 734(b) or
          743(b) is required, pursuant to Treasury Regulation Section 1.704-
          1(b)(2)(iv)(m), to be taken into account in determining Capital
          Accounts, the amount of such adjustment to the Capital Accounts shall
          be treated as an item of gain (if the adjustment increases the basis
          of the asset) or loss (if the adjustment decreases such basis).

     4.3  Negative Capital Accounts. If any Member has a deficit balance in
its Capital Account, such Member shall have no obligation to restore such
negative balance or to make any Capital Contributions to the Company by reason
thereof, and such negative balance shall not be considered an asset of the
Company or of any Member.

     4.4  No Withdrawal. No Member shall be entitled to withdraw any part of
its Capital Contribution or Capital Account or to receive any distribution from
the Company, except as expressly provided herein.

     4.5  Loans From Members. Loans by Members to the Company shall not be
considered Capital Contributions.

     4.6  Status of Capital Contributions.

          (a) No Member shall receive any interest, salary or drawing with
respect to its Capital Contributions or its Capital Account, except as otherwise
specifically provided in this Agreement.

          (b) Except as otherwise provided herein and by applicable state law,
the Members shall be liable only to make their Capital Contributions pursuant to
Section 4.1(a) hereof, and no Member shall be required to lend any funds to the
Company or, after a Member's Capital Contributions have been fully paid pursuant
to Section 4.1(a) hereof, to make any additional Capital

                                      -9-
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Contributions to the Company. No Member shall have any personal liability for
the repayment of any Capital Contribution of any other Member.

                                    ARTICLE 5

                        ALLOCATIONS OF PROFITS AND LOSSES

     5.1  Allocation of Profits and Losses.

          (a) Allocation of Profits. After giving effect to the allocations set
forth in Section 5.2 and Section 5.3, Profits for any Taxable Year (or other
period) shall be allocated to holders of Common Units pro rata according to
their Pro Rata Percentages.

          (b) Allocation of Losses. After giving effect to the allocations set
forth in Section 5.2 and Section 5.3, Losses for any Taxable Year (or other
period) shall be allocated to the holders of Common Units pro rata according to
their Pro Rata Percentages.

     5.2  Regulatory and Special Allocations. Notwithstanding the provisions
of Section 5.1:

          (a) To the extent an adjustment to the adjusted tax basis of any
Company asset pursuant to Code Section 734(b) or 743(b) is required to be taken
into account in determining Capital Accounts, the amount of such adjustment to
the Capital Accounts shall be treated, as provided in Treasury Regulation
Section 1.704-1(b)(2)(iv)(m), as an item of Profits (if the adjustment increases
the basis of the asset) or Losses (if the adjustment decreases such basis) and
such Profits or Losses shall be specially allocated to the Members in a manner
consistent with the manner in which their Capital Accounts are required to be
adjusted pursuant to such Section of the Treasury Regulations.

          (b) If there is a net decrease in Company Minimum Gain (determined
according to Treasury Regulation Section 1.704-2(d)(1)) during any Taxable Year,
each Member shall be specially allocated Profits for such Taxable Year (and, if
necessary, subsequent Taxable Years) in an amount equal to such Member's share
of the net decrease in Company Minimum Gain, determined in accordance with
Treasury Regulation Section 1.704-2(g).  The items to be so allocated shall be
determined in accordance with Treasury Regulation Sections 1.704-2(f)(6) and
1.704-2(j)(2).  This paragraph is intended to comply with the minimum gain
chargeback requirement in Treasury Regulation Section 1.704-2(f) and shall be
interpreted consistently therewith.

          (c) Member Nonrecourse Deductions shall be allocated in the manner
required by Treasury Regulation Section 1.704-2(i).  Except as otherwise
provided in Treasury Regulation Section 1.704-2(i)(4), if there is a net
decrease in Member Minimum Gain during any Taxable Year, each Member that has a
share of such Member Minimum Gain shall be specially allocated Profits for such
Taxable Year (and, if necessary, subsequent Taxable Years) in an amount equal to
that Member's share of the net decrease in Member Minimum Gain.  Items to be
allocated pursuant to this paragraph shall be determined in accordance with
Treasury Regulation Sections 1.704-2(i)(4) and 1.704-2(j)(2).  This paragraph is
intended to comply with the minimum gain chargeback requirements in Treasury
Regulation Section 1.704-2(i)(4) and shall be interpreted consistently
therewith.

                                      -10-
<PAGE>

          (d) In the event any Member unexpectedly receives any adjustments,
allocations or distributions described in Treasury Regulation Section 1.704-
1(b)(2)(ii)(d)(4), (5) or (6), Profits shall be specially allocated to such
Member in an amount and manner sufficient to eliminate the Adjusted Capital
Account Deficit created by such adjustments, allocations or distributions as
quickly as possible.  This paragraph is intended to comply with the qualified
income offset requirement in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)
and shall be interpreted consistently therewith.

          (e) The allocations set forth in paragraphs (a), (b), (c) and (d)
above (the "Regulatory Allocations") are intended to comply with certain
requirements of the Treasury Regulations under Code Section 704.
Notwithstanding any other provisions of this Article 5 (other than the
Regulatory Allocations), the Regulatory Allocations shall be taken into account
in allocating Profits and Losses among Members so that, to the extent possible,
the net amount of such allocations of Profits and Losses and other items and the
Regulatory Allocations to each Member shall be equal to the net amount that
would have been allocated to such Member if the Regulatory Allocations had not
occurred.

     5.3  Curative Allocations. If the President or Secretary of the Company
determines, after consultation with counsel experienced in income tax matters,
that the allocation of any item of Company income, gain, loss, deduction or
credit is not specified in this Article 5 (an "unallocated item"), or that the
allocation of any item of Company income, gain, loss, deduction or credit
hereunder is clearly inconsistent with the Members' economic interests in the
Company (determined by reference to the general principles of Treasury
Regulation Section 1.704-1(b) and the factors set forth in Treasury Regulation
Section 1.704-1(b)(3)(ii)) (a "misallocated item"), then the President or
Secretary of the Company may allocate such unallocated items, or reallocate such
misallocated items, to reflect such economic interests; provided that no such
allocation will be made without the prior consent of each Member that would be
affected thereby (which consent no such Member may unreasonably withhold) and
provided further that no such allocation shall have any material effect on the
amounts distributable to any Member, including the amounts to be distributed
upon the complete liquidation of the Company.

     5.4  Tax Allocations.

          (a) All income, gains, losses, deductions and credits of the Company
shall be allocated, for federal, state and local income tax purposes, among the
Members in accordance with the allocation of such income, gains, losses,
deductions and credits among the Members for computing their Capital Accounts,
except that if any such allocation for tax purposes is not permitted by the Code
or other applicable law, the Company's subsequent income, gains, losses,
deductions and credits shall be allocated among the Members for tax purposes, to
the extent permitted by the Code and other applicable law, so as to reflect as
nearly as possible the allocation set forth herein in computing their Capital
Accounts.

          (b) Items of Company taxable income, gain, loss and deduction with
respect to any property contributed to the capital of the Company shall be
allocated among the Members in accordance with Code Section 704(c) and the
traditional method of Treasury Regulation Section 1.704-3(b) so as to take
account of any variation between the adjusted basis of such property to the
Company for federal income tax purposes and its Book Value.

                                      -11-
<PAGE>

          (c) If the Book Value of any Company property is adjusted pursuant to
Section 4.2, subsequent allocations of items of taxable income, gain, loss and
deduction with respect to such property shall take account of any variation
between the adjusted basis of such property for federal income tax purposes and
its Book Value in the same manner as under Code Section 704(c).

          (d) Allocations of tax credit, tax credit recapture, and any items
related thereto shall be allocated to the Members according to their interests
in such items as determined by the President or Secretary of the Company taking
into account the principles of Treasury Regulation Section 1.704-1(b)(4)(ii).

          (e) Allocations pursuant to this Section 5.4 are solely for purposes
of federal, state and local taxes and shall not affect, or in any way be taken
into account in computing, any Member's Capital Account or share of Profits,
Losses, distributions or other items pursuant to any provisions of this
Agreement.

                                    ARTICLE 6

                                  DISTRIBUTIONS

     6.1  Generally.

          (a) Subject to Section 6.2, the President of the Company shall have
sole discretion regarding the amounts and timing of distributions to Members, in
each case subject to the retention and establishment of reserves of, or payment
to third parties of, such funds as it deems necessary with respect to the
reasonable business needs of the Company which shall include the payment or the
making of provision for the payment when due of the Company's obligations,
including the payment of any management or administrative fees and expenses or
any other obligations.

          (b) Notwithstanding any provision to the contrary contained in this
Agreement, the Company shall not make any distribution to Members if such
distribution would violate Section 18-607 of the Delaware Act or other
applicable law.

     6.2  Distributions. Distributions to be made by the Company on any date
shall be made to the holders of Common Units pro rata according to their Pro
Rata Percentages.

                                    ARTICLE 7

                            MANAGEMENT OF THE COMPANY

     7.1  Officers of the Company.

          (a) Establishment. A Majority in Interest of the Members shall
appoint individuals as officers ("officers") of the Company, which shall include
(i) a President, (ii) a

                                      -12-
<PAGE>

Secretary and (iii) such other officers (such as any number of Vice Presidents)
as a Majority in Interest of the Members deems advisable. Management and control
of the Company is hereby delegated to the officers, who shall conduct, direct,
and exercise full control over all activities of the Company as provided herein;
provided that all officers other than the President shall report to and shall be
under the direction of the President. An individual can be appointed to more
than one office. Each officer shall be a "manager" (as that term is defined in
the Delaware Act) of the Company.

          (b) Appointment. Effective as of the date hereof, the Majority in
Interest of the Members hereby appoint (i) Michael Krupka as President of the
Company and (ii) Michael Krupka as Secretary of the Company, in each case, until
their successors have been duly appointed and qualified, or until their earlier
death, resignation or removal in accordance with the terms of this Agreement.

          (c) Powers. The business and affairs of the Company shall be managed
by or under the direction of the President of the Company and the other
officers.

          (d) Authority of Officers. Any officer of the Company shall have the
right, power and authority to transact business in the name of the Company or to
act for or on behalf of or to bind the Company.  Third parties dealing with the
Company may rely conclusively upon any certificate of any officer to the effect
that such officer is acting on behalf of the Company.

          (e) Removal, Resignation and Filling of Vacancy of Officers. A
Majority in Interest of the Members may remove any officer, for any reason or
for no reason, at any time.  Any officer may resign at any time by giving
written notice to the Members, and such resignation shall take effect at the
date of the receipt of that notice or any later time specified in that notice;
provided, that unless otherwise specified in that notice, the acceptance of the
resignation shall not be necessary to make it effective.  Any such resignation
shall be without prejudice to the rights, if any, of the Company or such officer
under this Agreement.  A vacancy in any office because of death, resignation,
removal or otherwise shall be filled in the manner prescribed in this Agreement
for regular appointments to that office.

          (f) Compensation of Officers. No officer shall be entitled to receive
compensation from the Company for performing its duties as an officer under this
Agreement.

          (g) President. The President shall manage the business and affairs of
the Company.

          (h) Secretary. The Secretary shall (i) be custodian of the company
records; (ii) keep a register of the addresses of each Member which shall be
furnished to the Secretary by such Member; (iii) have general charge of the
Members Schedule; and (iv) in general perform all duties incident to the office
of a secretary of a company.  The Secretary shall have such other powers and
perform such other duties as are provided in this Agreement and as may from time
to time be prescribed by the President.

     7.2  Performance of Duties; Liability of Officers. In performing his or
her duties, each of the officers shall be entitled to rely in good faith on the
provisions of this Agreement and on

                                      -13-
<PAGE>

information, opinions, reports, or statements (including financial statements
and information, opinions, reports or statements as to the value or amount of
the assets, liabilities, profits or losses of the Company or any facts pertinent
to the existence and amount of assets from which distributions to Members might
properly be paid), of the following other Persons or groups: (a) one or more of
the other officers or employees of the Company; (b) any attorney, independent
accountant, or other Person employed or engaged by the Company; or (c) any other
Person who has been selected with reasonable care by or on behalf of the
Company, in each case as to matters which such relying Person reasonably
believes to be within such other Person's professional or expert competence. The
preceding sentence shall in no way limit any Person's right to rely on
information to the extent provided in Section 18-406 of the Delaware Act. No
individual who is an officer of the Company shall be personally liable under any
judgment of a court, or in any other manner, for any debt, obligation, or
liability of the Company, whether that liability or obligation arises in
contract, tort, or otherwise, solely by reason of being an officer of the
Company.

     7.3  Indemnification. The officers shall not be liable, responsible or
accountable for damages or otherwise to the Company, or to the Members, and, to
the fullest extent allowed by law, each officer shall be indemnified and held
harmless by the Company, including advancement of reasonable attorneys' fees and
other expenses, but only to the extent that the Company's assets are sufficient
therefor, from and against all claims, liabilities, and expenses arising out of
any management of Company affairs; provided that (a) such officer's course of
conduct was pursued in good faith and believed by him to be in the best
interests of the Company and (b) such course of conduct did not constitute gross
negligence or willful misconduct on the part of such officer and otherwise was
in accordance with the terms of this Agreement.  The rights of indemnification
provided in this Section 7.3 are intended to provide indemnification of the
officers to the fullest extent permitted by Delaware General Corporation Law
regarding a corporation's indemnification of its directors and officers and will
be in addition to any rights to which the officer may otherwise be entitled by
contract or as a matter of law and shall extend to his heirs, personal
representatives and assigns.  The absence of any express provision for
indemnification herein shall not limit any right of indemnification existing
independently of this Section 7.3.  Each officer's right to indemnification
pursuant to this Section 7.3 may be conditioned upon the delivery by such
officer of a written undertaking to repay such amount if such individual is
determined pursuant to this Section 7.3 or adjudicated to be ineligible for
indemnification, which undertaking shall be an unlimited general obligation.

                                    ARTICLE 8

                             MEMBERS; VOTING RIGHTS

     8.1  Voting Rights. Except as specifically provided herein or otherwise
required by applicable law, each Member shall be entitled to (x) one vote per
Voting Unit held by such Member and (y) no votes for any Nonvoting Units held by
such Member.

     8.2  Withdrawal; Resignation. A Member shall not cease to be a Member as
a result of the Bankruptcy of such Member.  So long as a Member continues to own
or hold any Membership Interests, such Member shall not have the ability to
resign as a Member prior to the dissolution and

                                      -14-
<PAGE>

winding up of the Company and any such resignation or attempted resignation by a
Member prior to the dissolution or winding up of the Company shall be null and
void.

     8.3  Authority. No Member, in his or its capacity as a Member, shall
have the power to act for or on behalf of, or to bind the Company.

     8.4  Limitation of Liability. No Member, in his or its capacity as
Member, shall have any liability for the debts, obligations and liabilities of
the Company, whether arising in contract, tort or otherwise.

                                    ARTICLE 9

                        TRANSFER OF MEMBERSHIP INTERESTS

     9.1  Restrictions. Each Member acknowledges and agrees that such Member
shall not Transfer any Membership Interest(s) except in accordance with the
provisions of this Article 9.  Any attempted Transfer in violation of the
preceding sentence shall be deemed null and void for all purposes, and the
Company will not record any such Transfer on its books or treat any purported
transferee as the owner of such Membership Interest(s) for any purpose.

     9.2  General Restrictions on Transfer.

          (a) Notwithstanding anything to the contrary in this Agreement, no
transferee of any Membership Interest(s) received pursuant to a Transfer (but
excluding transferees that were Members immediately prior to such a Transfer)
shall become a Member in respect of or be deemed to have any ownership rights in
the Membership Interest(s) so Transferred unless a Person is admitted as a
Member as set forth in Section 9.3(a).

          (b) Following a Transfer of any Membership Interest(s) that is
permitted under this Article 9, the transferee of such Membership Interest(s)
shall succeed to the Capital Account, Contributed Capital Account and the Pro
Rata Percentages associated with such Membership Interest(s) and shall receive
allocations and distributions under Articles 4, 5, 6 and 10 in respect of such
Membership Interest(s).

          (c) Any Member who Transfers all of his or its Membership Interests
(i) shall cease to be a Member upon such Transfer, and (ii) shall no longer
possess or have the power to exercise any rights or powers of a Member of the
Company.

          (d) Notwithstanding anything contained herein to the contrary, no
Member may Transfer any Membership Interest(s) without the prior written consent
of the President of the Company (provided that the President of the Company
shall be deemed to have given his prior written consent to any Transfer of
Membership Interest(s) by any Member pursuant to the Sealy Credit Agreement).

     9.3  Procedure for Transfers. Subject in all events to the general
restrictions on Transfers contained in Sections 9.1 and 9.2, a Member may
Transfer all or any part of his or its Membership Interests in accordance with
this Section 9.3.

                                      -15-
<PAGE>

          (a) No Transfer of Membership Interest(s) may be completed until the
prospective transferee is admitted as a Member of the Company by executing and
delivering to the Secretary of the Company a written undertaking to be bound by
the terms and conditions of this Agreement substantially in the form of Exhibit
A hereto.  Upon the amendment of the Members Schedule by the Secretary of the
Company and the satisfaction of any other applicable conditions, such
prospective transferee shall be admitted as a Member and deemed listed as such
on the books and records of the Company.

          (b) Unless waived by the President or Secretary of the Company, no
Member may Transfer any Membership Interests (except pursuant to an effective
registration statement under the Securities Act) without first delivering to the
Company an opinion of counsel reasonably acceptable in form and substance to the
Company (which counsel will be reasonably acceptable to the Company) that
registration under the Securities Act is not required in connection with such
Transfer.

     9.4  Limitations.

          (a) Notwithstanding anything to the contrary in this Agreement, no
Membership Interest may be Transferred if such Transfer would result in the
Company having more than 100 "beneficial owners" as defined and determined by
the Investment Company Act of 1940, as amended from time to time.

          (b) In order to permit the Company to qualify for the benefit of a
"safe harbor" under Code Section 7704, notwithstanding anything to the contrary
in this Agreement, no Transfer of any Membership Interest shall be permitted or
recognized by the Company (within the meaning of Treasury Regulation Section
1.7704-1(d)) if and to the extent that such Transfer would cause the Company to
have more than 100 partners (within the meaning of Treasury Regulation Section
1.7704-1(h), including the look-through rule in Treasury Regulation Section
1.7704-1(h)(3)).

                                   ARTICLE 10

                           DISSOLUTION AND LIQUIDATION

     10.1  Dissolution. The Company shall be dissolved and its affairs wound
up only upon the happening of any of the following events:

          (a) the sale or other disposition by the Company of all or
substantially all of the assets it then owns;

          (b) the written consent of a Majority in Interest of the Members;

          (c) the entry of a decree of judicial dissolution under (S) 18-802 of
the Delaware Act.

Dissolution of the Company shall be effective on the day on which the event
occurs giving rise to the dissolution, but the Company shall not terminate until
the winding up of the Company has been

                                      -16-
<PAGE>

completed, the assets of the Company have been distributed as provided in
Section 10.2 and the Certificate shall have been canceled.

     10.2  Liquidation.

          (a) Upon dissolution of the Company, a liquidator or liquidating
committee appointed by a Majority in Interest of the Members shall be the
liquidator (the "Liquidator").  The Liquidator shall be entitled to receive such
compensation for its services as may be approved by a Majority in Interest of
the Members.  The Liquidator shall agree not to resign at any time without 30
days prior written notice.  Except as expressly provided in this Article 10, the
Liquidator appointed in the manner provided herein shall have and may exercise,
without further authorization or consent of any of the parties hereto, all of
the powers conferred upon the officer of the Company under the terms of this
Agreement (but subject to all of the applicable limitations, contractual and
otherwise, upon the exercise of such powers) to the extent necessary or
desirable in the good faith judgment of the Liquidator to carry out the duties
and functions of the Liquidator hereunder for and during such period of time as
shall be reasonably required in the good faith judgment of the Liquidator to
complete the winding up and liquidation of the Company as provided for herein.

          (b) The Liquidator shall liquidate the assets of the Company, and
apply and distribute the proceeds of such liquidation, in the following order of
priority, unless otherwise required by mandatory provisions of applicable law:

                  (i) the payment to the creditors of the Company, including
          Members, in order of priority as provided by law;

                  (ii) to establish or add to such reserves as the Liquidator
          may deem necessary or appropriate; and

                  (iii)  to the Members as provided in Section 6.2.

The reserves established pursuant to subparagraph (ii) shall be paid over by the
Liquidator to a bank or other financial institution, to be held in escrow for
the purpose of paying any contingent or unforeseen liabilities or obligations
and, at the expiration of such period as the Liquidator deems advisable, such
reserves shall be distributed to the Members in the priorities set forth in this
Section 10.2(b).

          (c) The Members shall not be responsible for restoring any negative
balance in their Capital Accounts upon termination or dissolution of the
Company.

          (d) In any termination or dissolution of the Company, the Company may
distribute the assets of the Company to Members in cash, ratably in kind or any
combination thereof.  Each distribution in kind of property pursuant to Section
10.2(b)(iii) shall be distributed based upon the fair market value of such
property.  If a Liquidating Distribution is made both in cash and in kind, such
Liquidating Distribution shall be made so that, to the fullest extent
practicable, the percentage of cash and any other assets distributed to each
Member is identical.

                                      -17-
<PAGE>

          (e) Distributions upon liquidation of the Company (or any Member's
interest in the Company) and related adjustments shall be made by the end of the
Taxable Year of the liquidation (or, if later, within ninety (90) days after the
date of such liquidation) or as otherwise permitted by Treasury Regulation
Section 1.704-1(b)(2)(ii)(b), including requirements (2) and (3) thereof.

          (f) Upon completion of the distribution of the assets of the Company
as provided in Section 10.2(b) hereof, the Company shall be terminated and the
Liquidator shall cause the cancellation of the Certificate in the State of
Delaware and of all qualifications and registrations of the Company as a foreign
limited liability company in jurisdictions other than the State of Delaware and
shall take such other actions as may be necessary to terminate the Company.

          (g) Each Member hereby waives any rights to partition of the assets of
the Company.

                                   ARTICLE 11

                        GENERAL/MISCELLANEOUS PROVISIONS

     11.1  Notices. Except as expressly set forth to the contrary in this
Agreement, all notices, requests or consents provided for or permitted to be
given under this Agreement must be in writing and must be given either by
depositing that writing in the United States mail, addressed to the recipient,
postage paid, and registered or certified with return receipt requested or by
delivering that writing to the recipient in person, by courier, or by facsimile
transmission; and a notice, request, or consent given under this Agreement is
effective on receipt by the Person who receives it.  All notices, requests and
consents to be sent to a Member must be sent to or made at the address (or
facsimile number) given for that Member on the Members Schedule or such other
address (or facsimile number) as that Member may specify by notice to the
Secretary of the Company.  Any notice, request or consent to the Company must be
given to the Secretary of the Company.  Whenever any notice is required to be
given by law or this Agreement, a written waiver thereof, signed by the Person
entitled to notice, whether before or after the time stated therein, shall be
deemed equivalent to the giving of such notice.

     11.2  Governing Law. THIS AGREEMENT AND THE RIGHTS OF THE PARTIES
HEREUNDER SHALL BE INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE, AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

     11.3  Entire Agreement. This Agreement, the Bain Securities Purchase
Agreement and the Sealy Securities Purchase Agreement constitutes the entire
agreement of the parties thereto relating to the Company and supersede all prior
contracts or agreements with respect to the Company, whether oral or written.

     11.4  Amendment or Modification. This Agreement and any provision hereof
may be amended or modified from time to time, only by the prior approval of a
Majority in Interest of the Members.

                                      -18-
<PAGE>

     11.5  Binding Effect. Subject to the restrictions on Transfers set forth
in this Agreement, this Agreement is binding on and shall inure to the benefit
of the Members and their respective heirs, legal representatives, successors and
permitted assigns.

     11.6  Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original for all purposes, but all of
which taken together shall constitute only one agreement.

     11.7  Severability. Each provision of this Agreement shall be considered
severable and if for any reason any provision or provisions herein (a) are
determined to be invalid or contrary to any existing or future law, such
invalidity shall not impair the operation of or affect those portions of this
Agreement which are valid or (b) would cause any Member to be bound by the
obligations of the Company under the laws of any state or locale as the same may
now or hereafter exist, such provision or provisions shall be deemed void and of
no effect.

     11.8  Headings. All section headings or captions contained in this
Agreement are for convenience only and shall not be deemed part of the text of
this Agreement.

     11.9  Parties in Interest. Nothing herein shall be construed to be to
the benefit of or enforceable by any third party including, but not limited to,
any creditor of the Company.

     11.10  Further Assurances. The Members will execute and deliver such
further instruments and do such further acts and things as may be required to
carry out the intent and purposes of this Agreement.

     11.11  No Strict Construction. The parties to this Agreement have
participated jointly in the negotiation and drafting of this Agreement.  In the
event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties to this
Agreement, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement.

     11.12  Time of the Essence; Computation of Time. Time is of the essence
for each and every provision of this Agreement.  Whenever the last day for the
exercise of any privilege or the discharge or any duty hereunder shall fall upon
a Saturday, Sunday, or any date on which commercial banks in the State of
Delaware are authorized to be closed, the party having such privilege or duty
may exercise such privilege or discharge such duty on the next succeeding day
which is a regular business day.

                                    * * * * *

                                      -19-
<PAGE>

     IN WITNESS WHEREOF, this Limited Liability Company Agreement has been duly
executed on the day and year first above written.

                              SEALY, INC.

                              By:
                                   ----------------------------
                                   Name:
                                   Title:

                              BAIN CAPITAL, INC.

                              By:
                                   ----------------------------
                                   Name:
                                   Title:

                                      -20-
<PAGE>

                                                                      SCHEDULE A
                                                                      ----------
                                                                     Page 1 of 2
                      Mattress Holdings International, LLC
                                Members Schedule
                             (as of June 30, 1999)

<TABLE>
<CAPTION>
                           Contributed           Common Units
                             Capital       -----------------------------        Pro Rata
    Name of Member           Account       Class A    Class B      Total       Percentages
--------------------------------------------------------------------------------------------
<S>                      <C>              <C>        <C>         <C>         <C>

Bain Capital, Inc.           $     1,000         10           -          10          0.00365%

Sealy, Inc.                  $27,390,000          -     273,900     273,900         99.99635%

     Totals                  $27,391,000         10     273,900     273,910            100.0%
</TABLE>

                                     -A-1-
<PAGE>

                                                                      SCHEDULE A
                                                                      ----------
                                                                     Page 2 of 2
                      Mattress Holdings International, LLC
                                Members Schedule
                             (as of June 30, 1999)

Addresses of Members
--------------------
1. Bain Capital, Inc.
   Two Copley Plaza
   Boston, Massachusetts 02116
   Attention:  Michael Krupka

2. Sealy, Inc.
   One Office Parkway
   Trinity, North Carolina 27370
   Attention:  Ron Jones

                                     -A-2-
<PAGE>

                                                                       EXHIBIT A
                                                                       ---------

                               FORM OF JOINDER TO
                       LIMITED LIABILITY COMPANY AGREEMENT
                       -----------------------------------

          THIS JOINDER to the Limited Liability Company Agreement of Mattress
Holdings International, LLC, a Delaware limited liability company (the
"Company"), dated as of June 30, 1999, as amended or restated from time to time,
by and among the Members of the Company (the "Agreement"), is made and entered
into as of _________ by and between the Company and ________________ ("Holder").
Capitalized terms used herein but not otherwise defined shall have the meanings
set forth in the Agreement.

          WHEREAS, on the date hereof, Holder has acquired [CLASS A/CLASS B]
Common Units from _____________ and the Agreement and the Company require
Holder, as a holder of such [CLASS A/CLASS B] Common Units, to become a party to
the Agreement, and Holder agrees to do so in accordance with the terms hereof.

          NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties to this Joinder hereby agree as
follows:

     1.  Agreement to be Bound.  Holder hereby agrees that upon execution of
this Joinder, it shall become a party to the Agreement and shall be fully bound
by, and subject to, all of the covenants, terms and conditions of the Agreement
as though an original party thereto and shall be deemed, and is hereby admitted
as, a Member for all purposes thereof.

     2.  Members Schedule.  For purposes of the Members Schedule, the address of
the Holder is as follows:

                    [NAME]
                    [ADDRESS]

     3.  GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS OF THE PARTIES HEREUNDER
SHALL BE INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, AND
ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.

     4.  Descriptive Headings.  The descriptive headings of this Joinder are
inserted for convenience only and do not constitute a part of this Joinder.

                                    * * * * *
<PAGE>

          IN WITNESS WHEREOF, the parties hereto have executed this Joinder as
of the date first above written.

                              MATTRESS HOLDINGS INTERNATIONAL, LLC

                              By: _________________________________
                                  Name:
                                  Title:

                              [HOLDER]

                              By: _________________________________
                                  Name:
                                  Title:

                                      -2-<PAGE>

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

                                                                   EXHIBIT 10.32

                                               MC941121LD
                                               Page 1 of 19

                       ADVERTISING/MARKETING AGREEMENT

                                  WITNESSETH:

That in consideration of the agreements expressed herein, AT&T
Communications, Inc. - Business Communications Services ("AT&T") having an
office at 55 Corporate Drive, Bridgewater, New Jersey 08807 and Bronner
Slosberg Humphrey Inc., a corporation of the Commonwealth of Massachusetts
("Agency"), having an office at 695 Atlantic Avenue, Boston, Massachusetts
02111, do hereby agree as follows:

ARTICLE 1 - AGENCY SERVICES

The Agency shall act as AT&T's advertising/marketing agency in the planning,
preparing, and placing of such advertising/marketing, as may be requested by
AT&T. The Agency shall perform other services as AT&T may request, as outlined
in Article 30, subject to mutual written agreement of the parties.

Agency shall devote its best efforts on behalf of AT&T to farther AT&T's
interests and shall reasonably endeavor in every proper way to make AT&T's
advertising/marketing and associated efforts, for which the Agency is herein
responsible, successful. To accomplish the foregoing, Agency specifically agrees
that its services shall include but not be limited to the following:

    A.  Assigning and maintaining, with AT&T's consent executive strategic
        input and review, an account management group, creative, systems and
        fulfillment, research and analysis, teleservices marketing, partnership
        marketing, production, media and traffic teams necessary to service the
        AT&T account;

    B.  Provide direct marketing services, including the creation, production
        and placement, insertion or distribution of direct mail and direct
        response advertising.

    C.  Attending meetings, as requested by AT&T, with AT&T's staff and
        periodic meetings with AT&T's top management;

    D.  Familiarizing itself with the business of AT&T, its products and
        services, and the industry in which AT&T operates; and analyzing the
        present and potential advertising/marketing opportunities for such
        products and services so as to provide AT&T with marketing and
        advertising counsel, including specific advertising/marketing
        objectives, strategies and plans for reaching AT&T's business
        objectives;

    E.  Preparing layouts, copy, artwork, scripts and storyboards and furnishing
        other elements and materials to be used in finished advertisements for
        all media and promotions to be used by AT&T;
<PAGE>

                                               MC941121LD
                                               Page 2 of 19

    F.  Advising AT&T of the availability of all broadcast, publication and out-
        of-home media which can appropriately be used to advertise AT&T products
        and services; and developing media plans suitable for AT&T;

    G.  When publications media are to be used, arranging for insertions and
        checking the advertisements in accordance with mutually acceptable
        practices for date, appearance, position, size, quality and mechanical
        reproduction;

    H.  When broadcast media are to be used, arranging for the programs,
        commercials, time and talent, and plan; rendering all services necessary
        for the proper and efficient use of the media; auditing the audience
        share of broadcasts and verifying the broadcasts in accordance with
        mutually acceptable practices for time, accuracy and other related
        factors;

    I.  When outdoor posters, carcards, painted boards and other media are to
        be used, arranging for displays and verifying in accordance with
        mutually acceptable practices for date, appearance, position, site,
        workmanship and mechanical reproduction;

    J.  Supervising the production of all finished advertising and marketing
        material;

    K.  Negotiating, arranging and contracting for any special talent required,
        with AT&T's approval, and for all photography, models, special effects,
        layout, artwork and for all printing for use in the
        advertising/promotions program; and making appropriate arrangements for
        tax withholdings from talent;

    L.  Analyzing advertising, marketing and consumer research to aid AT&T in
        developing advertising strategy and developing and evaluating AT&T's
        advertising and media;

    M.  Conducting and analyzing competitive advertising tracking.

The above services shall be performed to the satisfaction of AT&T, shall be
performed in accordance with the highest professional standards and shall be in
accordance with such requirements or restrictions as may be lawfully imposed by
governmental authority. Services not completed to the reasonable satisfaction of
AT&T shall be reperformed at no cost to AT&T.

ARTICLE 2 - APPROVALS BEFORE COMMITMENT

No commitment of any kind shall be made by the Agency on behalf of AT&T unless
specifically authorized in writing by AT&T, except as provided in Article 3
(Estimates).

The Agency shall submit concepts, scripts, print copy and other materials as
early as possible to AT&T for internal review and required legal and technical
approval, and when appropriate to the networks' Broadcast
<PAGE>

                                               MC941121LD
                                               Page 3 of 19

Standards Departments, for specific approval prior to initial photographing,
broadcasting, telecasting, or print production of commercials or print
advertisements.

Agency shall contract with suppliers of media and such contracts shall provide
that Agency shall be solely liable for payment of media for time and/or space
costs incurred on behalf of AT&T from and after the time at which AT&T shall put
Agency in funds for payment thereof, and that all billing shall be sent to the
Agency.

ARTICLE 3 - ESTIMATES

The Agency shall furnish to AT&T, in writing and in advance, labor fee and a
cost estimate of all expenditures in connection with all services and projects
recommended by Agency or requested by AT&T. Prior to undertaking such projects
or committing AT&T's funds, Agency shall obtain written authorization from
AT&T. Agency shall furnish revisions of these estimates when changes in costs
are anticipated in excess of ten percent (10%), plus or minus. Each estimate as
approved by AT&T shall be executed by both parties. Approved estimates shall
constitute the only authorization for the Agency to take any action, make any
commitments or expend any money. In those situations where time or circumstances
will not permit specific prior written authorization, commitments not to exceed
$50,000 may be made with oral approval, provided such approval shall be
confirmed by an approved written estimate no later than ten (10) working days
thereafter.

ARTICLE 4 - DISCOUNTS

Agency shall obtain all prompt payment or other similar discounts available to
it from media and other suppliers from which it makes purchases in the
performance of the services hereunder. When Agency receives a cash discount,
rebate, frequency discount, volume discount, promotional consideration, or other
similar credit from such media or other suppliers, AT&T shall receive full
allowance for each such amount, provided Agency, after timely notification,
receives payment from AT&T within the applicable discount period.

ARTICLE 5 - ANNUAL REVIEW

An annual review shall take place during the first quarter (January - March) of
each calendar year for the review of the previous year's performance, to be
attended by appropriate AT&T management representatives and by Agency management
and senior members of the AT&T agency group. The purpose of this review is for
AT&T to present its evaluation of Agency performance to Agency and for Agency to
present its evaluation of AT&T management to AT&T, for AT&T and Agency to
mutually agree on any corrective action that may be needed and for AT&T and
Agency to set annual objectives.
<PAGE>

                                               MC941121LD
                                               Page 4 of 19

ARTICLE 6 - DEFINITIONS

A.  "Gross Revenue" as used herein shall mean the total amount of compensation,
    exclusive of pass-through costs, the Agency receives from AT&T for a
    advertising/marketing services performed after reconciliation and any
    rebates or supplementary fees are paid.

B.  "Annual Salary" as used herein shall mean annual base salary, excluding
    bonuses. It does not include employer paid FICA, insurance and medical
    benefits its or payments into retirement plans.

C.  "Direct Salaries" as used herein shall mean the [***] of [***] (including
    [***]) in [***], [***] (including [***] and [***]), [***], [***] (including
    [***]) and [***], [***] and [***], [***], [***] and [***] on the [***] which
    are [***] to the [***].

    1.  [***] for an individual who works on the AT&T account is to be computed
        as follows:

             [***] multiplied by the [***] of [***] on the [***] divided by the
             [***] of [***] on any [***].

        [***] on Agency business means [***] on any [***] and on [***] and other
        [***] It does not include [***], [***] or [***].

    2.  At AT&T's option, such option to be obtained by the Agency in writing
        from AT&T, AT&T may elect to "buy-out" designated individuals. For those
        individuals bought out by AT&T, AT&T shall be responsible for that
        person's total annual base salary, excluding bonuses.

D.  "Indirect Salaries" as used herein shall mean all [***] to the [***] other
    than [***] as defined herein.

E.  "All Other Expenses (ACE)" as used herein shall mean all other allowable
    expenses allocable to AT&T and shall include:

    1.  Other salaries that can be directly allocable to the AT&T account that
        are not included in direct salaries as defined in Section C above.

    2.  Payroll Related Expenses such as employer paid FICA, insurance and
        medical benefits.

    3.  Employer payments into ERISA-approved retirement plans.

    4.  Indirect Costs which include indirect salaries, agency overhead costs
        (e.g., space and facilities, professional fees and general corporate
        expenses). Donations are not to be included in Indirect Costs.

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

<PAGE>

                                               MC941121LD
                                               Page 5 of 19

    For purposes of compensation computation as set forth in Article 7, All
    Other Expenses are equal to [***] X [***] as defined hereof.

F.  "Direct Client Service Expenses" as used herein shall include out-of-pocket
    expenses of Agency employees related to the AT&T account.

G.  "Total Costs" as used herein shall equal [***] X [***].

H.  "Profit Before Taxes" as used herein shall mean [***] minus [***], where
    [***] equals ([***] + [***]) X [***].

ARTICLE 7 - AGENCY COMPENSATION

A.  Agency compensation for the calendar year shall be computed as follows:

    1.  During the last quarter of the previous calendar year, AT&T and the
        Agency shall meet to determine:

        a.  The account staffing (including all functions as defined in Article
            6, Paragraph C) for the AT&T account for the next calendar year.

        b.  The aggregate Direct Salaries, as defined herein, of the agreed upon
            account staff.

    2.  The fee for the calendar year is then ([***] + .[***]) X ([***] + [***])
        X [***].

    3.  For 1994 the yearly fee is [***]. For each subsequent year, the
        yearly fee shall be mutually agreed upon by the parties in writing and
        attached as an amendment hereto.

B.  [***] (expressed as a percent of [***]) as herein defined shall be based on
    [***] of [***] for the [***]. The specific criteria for evaluation shall be
    mutually agreed upon by the parties. However, the yearly Agency evaluation
    as performed by AT&T shall be at the sole discretion of AT&T.

    1.  At the end of each calendar year, the Agency shall submit to AT&T actual
        Direct Salaries as defined herein, and a computation of Profit Before
        Taxes according to the formula:

            Profit = Fee from [***] of this [***] - ([***] + [***]) X [***]

    2.  Based on the Agency evaluation as decided by AT&T, the Agency shall be
        allowed:

        a.  [***]% profit (expressed as a percent of Total Costs) if Agency
            evaluation is rated "unacceptable."

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

<PAGE>

                                               MC941121LD
                                               Page 6 of 19

        b.  [***]% profit (expressed as a percent of Total Costs) if Agency
            evaluation is rated "fully meets."

        c.  [***]% profit (expressed as a percent of Total Costs) if
            Agency evaluation is rated "exceeds."

        d.  [***]% profit (expressed as a percent of Total Costs) if Agency
            evaluation is rated "far exceeds."

    Agency shall use its best effort to provide actual Direct Salaries, actual
    All Other Expenses and Profit calculations within sixty (60) days of the end
    of the calendar year but in no event later than ninety (90) days after the
    end of the calendar year, so that reconciliation can be made. Agency agrees
    to keep accurate books of account and records, in accordance with generally
    accepted accounting principles, concerning all transactions hereunder,
    including documentation supporting all charges and including out-of-pocket
    expenses. An independent certified public accounting firm of the Agency's
    choice and at the Agency's expense shall annually review the Agency's
    books of account and records and shall certify that the bills to AT&T and
    actual Direct Salaries and Profit computations are accurate and in
    accordance with the definitions set forth in this Agreement. Verification of
    Direct Salaries shall be performed as outlined in Schedule I, attached
    hereto and made a part hereof. This audit privilege shall include access by
    the independent auditors to individual payroll and personnel records. Said
    books of account and records (excluding individual payroll and personnel
    records) shall be preserved and maintained by Agency and kept available for
    inspection by AT&T for at least three (3) years from the end of each
    accounting period.

C.  AT&T shall pay the Agency on dates to be mutually agreed upon by the
    parties.

D.  If for any reason Agency anticipates exceptional increases in Direct
    Salaries during any quarter of the year, a meeting between Agency and AT&T
    shall be called by the Agency to discuss what action should be taken while
    still providing AT&T with needed services.

E.  If for any reason AT&T expects the advertising/marketing budget to decline
    or increase significantly above or below the anticipated budget for the
    year, AT&T will notify Agency of this change as soon as possible.

F.  AT&T agrees to reimburse the Agency directly for reasonable Direct Client
    Service Expenses, including travel and living expenses authorized by AT&T
    and incurred in connection with this Agreement. Reimbursement for travel and
    living expenses shall be in accordance with the following guidelines:

    1.  Transportation

    a.  Airline Tickets - Agency will be reimbursed for air fare that has been
        purchased at coach fare for domestic travel (business class is allowed
        for international flights over six (6) hours in

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

<PAGE>

                                               MC941121LD
                                               Page 7 of 19

    duration). Agency employees may not request specific flights/carriers or
    arrange/alter travel plans to obtain airline promotional benefits. Agency
    employees traveling under first class status will be responsible for the
    expense difference incurred. The ticket stub must be presented and relate
    directly to the AT&T assignment. Reimbursement will not be made for the
    purchase of travel insurance.

b.  Reasonable taxi, bus, rail or car rental expenses will be reimbursed along
    with associated receipts from tolls, tips, and parking fees will be
    reimbursed by AT&T. Reimbursement for car rental expenses will be made upon
    presentation of a car rental agreement/receipt. Car rentals must be
    contracted at the lowest available rate and in the compact/subcompact
    category where possible, unless special requirements dictate otherwise, in
    which cases AT&T prior approval is required. For more than two people, a
    mid-size rental is acceptable, however, names of the people must be
    indicated on the car rental receipt.

    AT&T will not reimburse car rental refueling charges.

    Cab fares for "late nights" (after 8PM) are billable.

c.  A mileage allowance, as approved yearly by the IRS, will be reimbursed to
    Agency employees who use their own personal automobiles for services
    provided on behalf of AT&T. Allowable mileage is determined by deducting the
    normal commuting mileage.

    When traveling, use public transportation as a first choice, personal car as
    a second choice, and car rental as the last choice.

2.  Lodging and Meals - Maximum of $150.00/day hotel allowance for domestic
    travel, unless special requirements dictate otherwise, in which case AT&T
    prior approval is required. Lower rates should be used if available. Agency
    shall only invoice hotel expenses that are directly related to the work
    performed under this Agreement. Expenses incurred at hotels for AT&T
    business-related services (fax, typing, photocopying) are reimbursable.

    AT&T will reimburse the Agency for meal expenses not exceeding $65.00 per
    day, per person, which shall include room service and gratuities. Business
    lunches are billable (only if an AT&T employee is present). Overtime meals
    are not billable.

3.  Business Calls - Business calls made on AT&T's behalf while staying
    overnight are billable. Calls must list reason and person called and be on
    the AT&T Network. Personal calls are not billable.

4.  Personal Expenses - AT&T will not reimburse personal expenses of Agency
    employees. If expenses of a personal nature (i.e., hotel/ship purchases,
    alcoholic beverages, telephone and long
<PAGE>

                                               MC941121LD
                                               Page 8 of 19

        distance charges, in-room movies, sundry items, etc.) are charged
        against the room, the amount will be deducted from the invoice presented
        to AT&T. For trips which extend beyond five (5) days, reasonable valet
        and laundry charges will be reimbursed. AT&T will reimburse reasonable
        gratuities.

    5.  Magazines/Newspapers/Books are not billable unless specifically
        requested, in writing, by AT&T.

    E.  Services provided by Agency employees - For services requested by AT&T,
        the Agency shall provide, as a maximum, the following number of people:

                                               Maximum Number of People

        a.  Location Shoots                              3
        b.  Press Runs                                   1
        c.  Strategy Meetings                            *
        d.  Review Meetings                              *
        e.  Research Meetings (Focus Groups)             *

        * Agency shall obtain prior approval from AT&T regarding the number of
          people to attend.

    The Agency shall submit copies of all hotel bills and other reimbursable
    expenses along with the associated charge receipt(s). Expenses shall be
    billed at cost and invoices for all reimbursable expenses shall list the
    date(s), company, person(s) visited and business purpose for the expense.

ARTICLE 8 - DURATION

The term of this Agreement shall begin on January 1, 1994 and shall continue
until terminated by either party for their convenience by giving ninety (90)
days written notice or as otherwise provided herein.

After expiration of the period of notice, no rights or liabilities shall arise
out of this relationship, regardless of any plans which may have been made for
future advertising promotions, except that: (1) if AT&T terminates, any non-
cancelable contracts made on AT&T's authorization (or any uncompleted work
previously approved by AT&T either specifically or as part of a plan, and still
existing at the expiration of the period of notice), which contracts were not or
could not be assigned by the Agency to AT&T or AT&T's assignee, shall be
carried to completion by the Agency and paid for by AT&T; and (2) if Agency
terminates, it shall be similarly responsible for any non-cancelable contracts
unless AT&T chooses to assume such contracts. Upon termination of this
Agreement, the Agency shall transfer, assign, and make available to AT&T, all
property and materials in the Agency's possession or control belonging to and
paid for by AT&T, and all information regarding AT&T's advertising. The Agency
also agrees to give all reasonable cooperation towards transferring, with the
approval of third parties in interest, all assignable reservations, contracts
and agreements with advertising media, or others, for advertising space,
<PAGE>

                                               MC941121LD
                                               Page 9 of 19

broadcast time or materials yet to be used and all rights and claims thereto and
therein, upon being duly released from the obligation thereof. Upon termination,
unused advertising/promotional plans and ideas prepared by the Agency for AT&T
prior to the date of termination shall remain AT&T's property.

Except as otherwise specifically set forth, all the rights and liabilities of
the parties arising out of this Agreement shall cease on the date of
termination.

ARTICLE 9 - BILLING AND PAYMENT

A.  Agency's bills for space in publications, outdoor and carcard advertising,
    and radio and TV time and talent shall be rendered to AT&T in sufficient
    time to afford AT&T a reasonable opportunity to remit funds to enable Agency
    to pay charges incurred for AT&T's account on their due dates, and AT&T
    agrees to pay such bills within the time herein specified for payment.
    Agency's bills for other items will be rendered to AT&T from time to time;
    unless otherwise specified, such bills will be due and payable within
    thirty (30) days from date thereof. Agency shall submit all media and other
    invoices in time for AT&T to obtain customary cash discounts. All bills
    submitted to AT&T by Agency shall be net of all commissions and/or markups.

    All non-media billing charges shall be in accordance with Schedule II,
    attached hereto and made a part hereof. In no event shall AT&T be liable for
    media or non-media bills unless the Agency submits such bills to AT&T within
    three (3) months from the date in which costs were incurred.

B.  Receipt or acceptance by AT&T of any statement or invoice furnished pursuant
    hereto or any sums paid by AT&T hereunder shall not preclude AT&T from
    questioning the correctness thereof within two (2) years of the year in
    question, and if any inconsistencies or mistakes are discovered in such
    statements or payments, they shall be immediately rectified and prompt
    adjustments and corresponding payments shall be made to compensate thereof.

C.  AT&T agrees to pay any "short rates" with which AT&T is justly charged by
    the media placed on AT&T's behalf by Agency for any premature termination
    of a contract that is caused by AT&T. Agency shall pay any "short rates"
    with which AT&T is charged by media for any premature termination of a
    contract that is caused by Agency.

The Agency shall submit invoices for all work performed under this Agreement.
Invoices against this Agreement shall indicate the work performed for which
billing is rendered, shall be in accordance with approved estimates and shall be
submitted in duplicate.
<PAGE>

                                               MC941121LD
                                               Page 10 of 19

ARTICLE 10 - NOTICES

Any notice or demand which under the terms of this Agreement or under any
statute must or may be given or made by Agency or AT&T shall be in writing and
shall be given or made by telegram, telex, confirmed facsimile or by certified
or registered mail.

Such notice or demand shall be deemed to have been given or made when sent by
telegram, telex, or facsimile or when deposited, postage prepaid in the
U.S. mail.

ARTICLE 11 - TITLE

A.  Except as set forth in Paragraph C below, all creative work and work
    products, including, but not limited to, advertising and/or marketing plans,
    media plans, ideas, and advertising materials developed by the Agency, or on
    Agency's behalf, for AT&T in connection with this Agreement, and any and all
    copyrights therein are hereby assigned and agreed to be assigned by Agency
    to AT&T and shall be and will remain the exclusive property of AT&T, which
    may use any of such as it deems appropriate. All such work and work products
    shall be considered "works made for hire" to the extent allowed by law.
    Agency shall acquire for AT&T from Agency subcontractors or others all such
    assignments, rights and covenants, and will furnish AT&T with all such
    documentation, as, any of them, are needed in AT&T's reasonable opinion to
    assure vesting in it of title to, and unrestricted ownership rights in, such
    work, work products and copyrights, and to perfect the enforceability of
    such copyrights.

    Should the Agency desire to use material developed for AT&T for another
    client or for other business reasons it may request AT&T's permission to do
    so. Granting of any such permission shall be at AT&T's sole discretion.

B.  If Agency furnishes AT&T with materials previously copyrighted by Agency and
    not originally prepared hereunder, Agency hereby grants and agrees to grant
    to AT&T unrestricted, non-exclusive, royalty-free licenses for all purposes
    under any and all copyrights in such materials, with the unrestricted right
    to grant such sublicenses under those licenses as AT&T may see fit, to the
    extent that such materials are used in conjunction with any of the work and
    work products referred to in Paragraph A of this Article.

C.  If AT&T has consented to the inclusion of materials owned or copyrighted by
    others, or in which other rights may be claimed by others (and there shall
    be no such inclusion without AT&T's prior consent), then the Agency shall
    notify AT&T of the scope of the rights and permissions the Agency intends to
    obtain with respect to such materials and shall modify the scope of same as
    requested by AT&T. Copies of all rights and permissions clearly identifying
    the included works to which they apply shall be supplied to AT&T prior to
    program completion.
<PAGE>

                                               MC941121LD
                                               Page 11 of 19

D.  Agency warrants the originality of the work prepared for AT&T hereunder
    (except if such work is in the public domain) and its disclosure to AT&T
    exclusively and that, except as provided in Paragraphs B and C above, no
    portion of the material prepared for AT&T under this Agreement is derived
    from copyrighted material.

E.  Agency undertakes that no part of the creative work or work products
    developed for AT&T in connection with this Agreement, whether or not
    copyrightable, shall be disclosed to any persons or used by the Agency to
    produce creative materials for any persons other than AT&T without the
    express written permission of AT&T.

F.  Agency shall retain all materials for two years or for such longer period as
    is necessary for purposes of carrying out Agency's obligations hereunder
    after which time they will be returned to AT&T, placed in public storage at
    AT&T's expense, or destroyed as requested by AT&T. Agency shall safeguard
    and be responsible for all materials entrusted to it by or on behalf of AT&T
    and shall return such materials to AT&T upon request of AT&T, and, in any
    event, as soon as practicable upon termination of this Agreement. Agency
    shall provide copies of materials requested by AT&T to the extent necessary
    for AT&T to litigate or negotiate claims or to handle proceedings before
    regulatory agencies.

ARTICLE 12 - USE OF INFORMATION

Except under the conditions stated in the next sentence, any materials and/or
information furnished or disclosed by AT&T or developed by the Agency hereunder
is the property of and shall be deemed confidential to AT&T and shall be
surrendered to AT&T at the conclusion of this Agreement, or shall be destroyed
if AT&T shall so direct in writing. Unless such information or materials were
previously known to the Agency free of any obligation to keep it confidential,
or is subsequently made public by AT&T or by a third party having a legal right
to make such disclosure, it shall be held in confidence by the Agency, shall be
used only for the purposes hereunder, and may be used for other purposes only
upon such terms and conditions as may be mutually agreed upon in writing.

ARTICLE 13 - EXCLUSIVITY AND RESERVATION OF RIGHTS

A.  For the duration of this Agreement, including the period of notice prior to
    its effectiveness of termination, Agency and any of its constituent
    companies anywhere in the world shall not undertake any work for any of the
    following companies: Ameritech, Bell Atlantic, Bell South, British Telecom,
    IBM, MCI, NYNEX, Pacific Telesis, Southwestern Bell, Sprint or US West.

B.  Further, Agency and any of its constituent companies shall not work for
    other companies that compete with any AT&T unit unless Agency receives
    written approval from AT&T and the following three (3) conditions are met:
<PAGE>

                                               MC941121LD
                                               Page 12 of 19

    1.  The non-AT&T business is not competitive with the AT&T account handled
        by the Agency.

    2.  A "virtual wall" is erected so that none of the people working
        on AT&T's business share any information with people working on the
        competitive account.

    3.  The Agency understand that if the competitive company shifts its focus
        and strategy to become a strategic competitor, the Agency must then
        choose to work only for AT&T or the competitor.

ARTICLE 14 - AGENCY'S INFORMATION

No specifications, drawings, sketches, models, samples, tools, computer or other
apparatus programs, technical or business information or data, written, oral or
otherwise, furnished by Agency to AT&T under this Agreement, or in contemplation
of this Agreement, shall be considered by Agency to be confidential or
proprietary unless subject matter so furnished is owned by AT&T as defined and
provided under the Article 11 (Title) or Article 12 (Use of Information),
contained herein.

ARTICLE 15 - INDEMNIFICATION/INFRINGEMENT

The Agency agrees to indemnify and save harmless AT&T, its subsidiaries,
affiliates and its customers and their officers, directors, employees successors
and assigns (collectively referred to as "AT&T") from and against the following
claims, losses, suits, demands, or liens:

A.  Any tortious act, omission, or statement of the Agency or any person
    employed by or under contract with the Agency that results in
    injury (including death), loss or damage to any person or property,
    including libel, slander, and defamation;

B.  Injuries or death to persons or damage to property, including theft, in any
    way arising out of or occasioned by, caused or alleged to have been caused
    by or on account of the performance of the work or services performed by
    Agency or persons furnished by Agency, except to the extent such injury or
    damages are caused by AT&T's sole negligence or willful misconduct;

C.  Any failure on the part of the Agency to satisfy all claims for labor,
    equipment, materials and other obligations relating to the performance of
    the work hereunder;

D.  Piracy, unfair competition, plagiarism, idea misappropriation under implied
    contract;

E.  Assertions under Worker's Compensation or similar acts made by persons
    furnished by Agency or by any subcontractor, or by reason of any injuries to
    such persons for which AT&T would be responsible under Worker's
    Compensation or similar acts if the persons were employed by AT&T;
<PAGE>

                                               MC941121LD
                                               Page 13 of 19

F.  Any failure by the Agency to perform Agency's obligations under this clause
    or, Article 16 (Insurance); and

G.  Any act of infringement of any patent, trademark, or copyright; any title,
    slogan, or other trademark; or any unauthorized use of trade secret or other
    proprietary interest, except where such infringement or unauthorized use
    arises solely from Agency's adherence to AT&T's written instructions which
    are so specific as to directly cause said infringement or unauthorized use,
    in which case AT&T shall so indemnify Agency; provided however, if such
    instructions specify (1) commercial material which is available on the open
    market or is the same as such material or (2) material of Agency's origin,
    design or selection, and the adherence to such instructions results in the
    infringement or unauthorized use, then Agency shall indemnify AT&T for any
    such infringement or unauthorized use.

However, the indemnification in (A) shall not apply to claims for loss or damage
to property arising solely from Agency's reasonable reliance upon the accuracy,
completeness and propriety of information furnished by AT&T concerning its and
its competitors organization, products, industry and services in developing or
producing work or work products under this Agreement.

Each party shall defend or settle, at its own expense, any action or suit
against the other for which it is responsible hereunder and shall reimburse the
other for reasonable attorneys' fees, interest, costs of suit and all other
expenses incurred by the other in connection therewith. Each party shall notify
the other promptly of any claim for which the other is responsible hereunder and
shall cooperate with the other in every reasonable way to facilitate the defense
of any such claim.

ARTICLE 16 - INSURANCE

Agency shall maintain during the term of this Agreement (1) Worker's
Compensation insurance as prescribed by the law of the state or nation in which
the work is performed; (2) employer's liability insurance with limits of at
least $300,000 for each occurrence; (3) comprehensive automobile liability
insurance if the use of motor vehicles is required, with limits of at least
$1,000,000 combined single limit for bodily injury and property damage for each
occurrence; (4) Comprehensive General Liability ("CGL") insurance, including
Advertiser's Liability and Blanket Contractual Liability and Broad Form
Property damage, with limits of at least $5,000,000 combined single limit for
personal injury and property damage for each occurrence. All CGL insurance shall
designate AT&T as an additional insured for work Agency performs for AT&T.
Agency shall cause its subcontractors to maintain insurance similar in form and
account as AT&T shall approve, which approval shall not be reasonably withheld.
All such insurance must be primary and required to respond and pay prior to any
other available coverage.

Agency agrees that Agency, Agency's insurer(s) and anyone claiming by, through,
under or in Agency's behalf shall have no claim, right of action or right of
subrogation against AT&T and its customers based on any loss
<PAGE>

                                               MC941121LD
                                               Page 14 of 19

or liability insured against under the foregoing insurance. Agency shall furnish
prior to the start of work certificates or adequate proof of the foregoing
insurance. AT&T shall be notified in writing at least thirty (30) days prior to
cancellation of or any change in the policy.

ARTICLE 17 - RELATIONSHIP

The Agency shall exercise full control and direction over the employees of the
Agency performing the work covered by this Agreement. Any changes in personnel
performing services for AT&T that may be reasonably requested by AT&T through
its authorized representative shall be made promptly.

Neither the Agency nor its employees or agents shall be deemed to be AT&T's
employees or agents, it being fully understood that Agency employees are
entitled to no benefits or compensation from AT&T. It is understood that the
Agency is an independent contractor for all purposes and at all times. The
Agency is wholly responsible for withholding and payment of all applicable
federal, state and local income and other payroll taxes with respect to its
employees, including contributions from them as required by law. Agency agrees
to indemnify, defend and hold AT&T harmless from any claims made by Agency
employees or former Agency employees, their heirs or assigns, against AT&T for
direct compensation, including salaries and bonuses, or for any benefits such as
medical, dental, life insurance or pension benefits.

ARTICLE 18 - SUBCONTRACTS

The Agency shall be responsible for informing subcontractors of their
responsibility to protect any confidential and proprietary information included
in any work subcontracted hereunder, and Agency shall undertake all necessary
precautions to insure that each subcontractor is in compliance with this
Article. This Agreement is not intended to create any legal rights or interests
as to persons not directly a party hereto. In accordance with this
understanding, Agency shall remain fully, directly and solely responsible for
all expenses it incurs of any nature whatsoever and shall indemnify, defend and
hold AT&T harmless from any and all claims made against AT&T by persons not a
party to this Agreement for non-payment of such expenses (except those incurred
as an authorized and disclosed advertising agent for AT&T in connection with
approved work or services performed or purchases made hereunder).

If Agency elects to subcontract out any work, then the Agency shall request
competitive quotations from a minimum of three vendors when the subcontracted
work is estimated to exceed $20,000. The quotation process shall be
administered by the Agency and contracts awarded by the Agency, but only with
the prior concurrence of AT&T. Copies of the quotations shall be submitted to
AT&T for review and approval prior to the award of a contract. In the event a
selected vendor cannot perform, the Agency shall select another vendor upon
notification to and approval by AT&T. The Agency shall not fragment any
subcontracted work to avoid the obligation to obtain quotations.
<PAGE>

                                               MC941121LD
                                               Page 15 of 19

ARTICLE - 19 USE OF AT&T'S NAME, LOGO, AND MARKS

All use of AT&T's name, logo and marks shall be in strict conformance with any
written BCS, Corporate or other guidelines provided by AT&T and shall be
approved in advance by AT&T.

ARTICLE 20 - AUDIT

Agency shall maintain accurate and complete records including a physical
inventory, if applicable, of all costs incurred under this Agreement in
performing the services covered by this Agreement, including the costs of labor
(other than individual salaries and bonuses of agency employees), equipment,
materials, and other disbursements. These records shall be maintained in
accordance with recognized commercial accounting practices so they may be
readily audited and shall be held until costs have been finally determined under
this Agreement and payment or final adjustment of payment, as the case may be,
has been made. Agency shall permit AT&T or AT&T's representative to examine and
audit these records on reasonable notice. Audits shall be made not later than
two (2) calendar years after the end of the year in question.

ARTICLE 21 - ASSIGNMENT

The Agency shall not assign any right under this Agreement (excepting monies due
or to become due), subcontract any work or delegate any other obligations to be
performed or owed under this Agreement without the prior written consent of
AT&T. Any attempted assignment or delegation in contravention of the above
provisions shall be void and ineffective. Any assignment of monies shall be void
and ineffective to the extent that (1) Agency shall not have given AT&T at least
thirty (30) days prior written notice of such assignment or (2) such assignment
attempts to impose upon AT&T obligations to the assignee additional to the
payment of such monies, or to preclude AT&T from dealing solely and directly
with Agency in all matters pertaining to this Agreement including the
negotiation of amendments or settlements of charges due. All work performed by
Agency's subcontractor(s) at any time shall be deemed work performed by the
Agency.

ARTICLE 22 - TAXES

AT&T shall reimburse Agency only for the following tax payments with respect to
transactions under this Agreement unless an exemption applies: state and local
sales and use taxes, as applicable. Taxes payable by AT&T shall be billed as
separate items on Agency's invoices and shall not be included in Agency's
prices. AT&T shall have the right to have Agency contest any such taxes that
AT&T reasonably deems improperly levied, at AT&T's expense and subject to its
direction and control.
<PAGE>

                                               MC941121LD
                                               Page 16 of 19

ARTICLE 23 - COMPLIANCE WITH LAWS

Agency and all persons furnished by Agency shall comply at their own expense
with all applicable federal, state and local laws, ordinances, regulations and
codes, including identification and procurement of required permits,
certificates, licenses, insurance approvals and inspections, in performance
under this Agreement. Agency agrees to indemnify AT&T and its customers for any
loss or damage that may be sustained by reason of any failure to do so.

ARTICLE 24 - PUBLICITY, ADVERTISING

The Agency agrees not to advertise, promote, make use of any identification of
AT&T or publicize matters relating to the services performed under this
Agreement or to mention or imply any relationship or connection with AT&T in
such advertising, promotion or publicity without the prior written consent of
AT&T. The term "identification" includes any trade name, trademark, service
mark, insignia, symbol, or any simulation thereof, and any code, drawing,
specification, or evidence of AT&T's inspection. This article does not modify
Article 12 (Use of Information).

ARTICLE 25 - WAIVER

The failure of either party at any time to enforce any right or remedy available
to it under this Agreement with respect to any breach or failure by the other
party shall not be construed to be a waiver of such right or remedy with respect
to any other breach or failure by the other party.

ARTICLE 26 - SEVERABILITY

In the event that any one or more of the provisions contained herein shall for
any reason be held to be unenforceable in any respect under the laws of any
state, or of the United States of America, such unenforceability shall not
affect any other provision of this Agreement, but this Agreement shall then be
construed as if such unenforceable provision or provisions had never been
contained herein.

ARTICLE 27 - SURVIVAL OF OBLIGATION

The obligations of the parties under this Agreement that by their nature would
continue beyond the termination, cancellation or expiration of this Agreement,
including by way of illustration only and not limitation, those in the clauses
in Article 23 (Compliance With Laws), Article 16 (Insurance), Article 15
(Indemnification/Infringement), Article 12 (Use of Information), shall survive
termination, cancellation or expiration of this Agreement.
<PAGE>

                                               MC941121LD
                                               Page 17 of 19

ARTICLE 28 - CHOICE OF LAW

The construction, interpretation and performance of this Agreement shall be
governed by the laws of the State of New Jersey, excluding its choice of law
rules.

ARTICLE 29 - RELEASES VOID

Neither party shall require (1) waivers or releases of any personal rights or
(2) execution of documents, which conflict with the terms of this Agreement from
employees, representatives or customers of the other in connection with visits
to its premises and both parties agree that no such releases, waivers or
documents shall be pleaded by them or third persons in any action or proceeding.

ARTICLE 30 - SPECIAL SERVICES

At the request of AT&T, Agency may be asked to perform the following special
marketing communications services:

A.  Create and produce sales promotion and collateral material.

B.  Develop new product or service concepts and test marketing of new products
    and services.

C.  Conduct special advertising or market research.

D.  Provide publicity and public relations services.

E.  Provide specialized advertising services such as classified and recruitment
    advertising.

F.  Manage print media contracts and maintain total AT&T print data base.

G.  Negotiate services for print media.

H.  Negotiate services for media appearing outside the United States
    (international).

I.  Design services including packaging, trademarks and corporate identity
    programs.

J.  Stage and conduct sales, marketing positioning, sporting or other events and
    meetings.

K.  Design and prepare exhibits for trade shows or other venues.

L.  Prepare visual presentation materials.

M.  Produce television and/or radio programming other than commercials, or print
    materials which are not advertising.
<PAGE>

                                               MC941121LD
                                               Page 18 of 19

For any special services requested by AT&T and performed by Agency, compensation
shall be mutually agreed upon in writing prior to the start of work.

ARTICLE 31 - NONEXCLUSIVE RIGHTS

It is expressly understood and agreed that this Agreement does not grant to the
Agency an exclusive right or privilege to provide any and all of the services
described in this Agreement which AT&T may require. It is, therefore, understood
that AT&T may contract with other agencies for the procurement of the same or
comparable services.

ARTICLE 32 - CHANGES IN, TERMINATION, OR SUSPENSION OF PARTICULAR WORK

AT&T may, at any time, by written notice, advise the Agency of AT&T's intent to
make changes in, additions to, or deductions from, the work on any specific
program under an approved estimate. If such intended changes cause an increase
or decrease in the amount or character of the services to be rendered under this
Agreement, or in the time required for its performance, the Agency shall
promptly so advise AT&T, specifying the impact of such change on the approved
estimates. Thereafter, if AT&T elects to make such change, an equitable
adjustment to all appropriate terms and conditions, including the amount to be
paid to the Agency and the time for performance shall be made and this Agreement
shall be modified accordingly in writing. Notwithstanding anything contained in
this Article 32 to the contrary no change shall have the effect of reducing the
required ninety (90) days notice of termination.

ARTICLE 34 - ENTIRE AGREEMENT

This Agreement constitutes the entire agreement between the Agency and AT&T
relating to the subject matter hereof and shall not be modified or rescinded in
any manner except by a writing executed by both parties. Other than as expressly
provided herein, both the Agency and AT&T agree that no prior or contemporaneous
oral representations form a part of their agreement. Additional or different
terms inserted in this Agreement by Agency, or deletions thereto, whether by
alterations, addenda, or otherwise, shall be of no force and effect, unless
expressly consented to by AT&T in writing. The provisions of this Agreement
supersede all contemporaneous oral agreements and all prior oral and written
quotations, communications, agreements and understandings of the parties with
respect to the subject matter of this Agreement.

It is agreed and understood that Agreement Number AD911475LD executed on May 7,
1991 shall be deemed terminated, superseded and replaced by the terms and
conditions of this Agreement effective January 1, 1994.
<PAGE>

                                               MC941121LD
                                               Page 19 of 19

WITNESS WHEREOF, the Agency and AT&T have executed this Agreement in duplicate
on the day and year below written.

                                      AT&T COMMUNICATIONS, INC.
BRONNER SLOSBERG HUMPHREY INC.        BUSINESS COMMUNICATIONS SERVICES

By: /s/ Robert E. Stoloff              By:  /s/ David W. Robertson
    -------------------------------       ------------------------------------
             (Signature)                              (Signature)

        Robert E. Stoloff                         David W. Robertson
    SVP & Chief Financial Officer                     - Director
    -------------------------------       ------------------------------------
    (Name & Title Typed or Printed)          (Name & Title Typed or Printed)

          October 11, 1995                         September 11, 1995
    -------------------------------       ------------------------------------
                 (Date)                                 (Date)
<PAGE>

                                                 MC941121LD
                                                 Schedule I
                                                 Page 1 of 3

                                  SCHEDULE I

    [***] & ALL OTHER EXPENSES AUDIT INSTRUCTIONS

A.  General

1.  Obtain the current agency agreement between the Agency and AT&T.

2.  Obtain the AT&T agency fee computation.

B.  [***]

1.  [***], for all [***] in the [***] as defined herein in [***], [***], [***]
    on the [***], which [***] by [***] and [***], all [***]
    during the [***].

    a.  [***], on a [***] or as [***] by [***], [***] ([***]%) of the [***] who
        have [***] on the [***] during the [***] ([***] of [***]). This [***]
        would include the [***] by [***], if applicable. Note that at least
        [***] ([***]%) of the [***] must have [***] at least [***] ([***]%) of
        their [***] on the [***]. (See [***] [***].[***].[***] below).

    b.  If more than [***]-[***][***] ([***]%) of [***] in [***]
        [***].[***].[***]. above have [***] less than [***] ([***]%) of their
        [***] on [***], on a [***], [***] who [***] less than [***] ([***]%) of
        their [***] to [***] and [***] with a [***], until [***] ([***]%) of the
        [***] ([***]%) or more of their [***] to the [***].

    c.  For [***] a [***] of [***] ([***]) [***] or [***] ([***]) [***] on a
        [***], [***] ([***], [***] and [***]) to [***].

    d.  [***] does not include [***], [***] and [***].

    e.  [***] the [***] to each [***] by the [***] to [***] at a [***] by [***].

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.
<PAGE>

                                                                    MC941121LD
                                                                    Schedule I
                                                                   Page 2 of 3

2.   [***] of [***] (including [***], but
     excluding [***]) for the [***] in [***].[***].[***]. above.

     a.   [***] the [***] in the [***] to the [***]-[***][***], [***] and
          [***]([***]) [***] on a [***].

     b.   If [***] in [***] were [***] during the [***], [***] the [***], the
          [***] shall be [***] to be the [***] of the [***] during the [***].
          In these [***], [***] the [***] of the [***].

     c.   [***] that no [***], [***], [***] or [***] are included in the [***]
          of [***]. Note that [***] are not included as [***] of the [***].

3.   [***] of [***] by [***].

     a.   [***] the [***] per [***].[***]. above and [***] per
          [***].[***].[***]. above, [***] the [***] and [***] to the [***].

     b.   [***] the [***] of the [***].

4.   [***] the [***] in [***].[***]. through [***].[***]. above, to the [***] in
     [***]. below.

C.   Overall Salary Testing
     ----------------------

     Obtain report of annual base salary (including regular time, overtime but
     excluding bonus payments) for all employees who charged time to the AT&T
     account. Agree the information contained in this report to the year-end
     payroll register.

D.   Profit Calculation
     ------------------

     Recalculate the agency fee computation, obtained in Step A.2 above, as
     defined in Article 7 of the Agreement.

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

<PAGE>

                                                                      MC941121LD
                                                                      Schedule I
                                                                     Page 3 of 3

E. Compliance Procedures
   ---------------------

1. If any errors were noted in Step B above, ensure the profit calculation is
   corrected by the Agency prior to submission of the final fee calculation to
   AT&T. If not corrected, include a summary of all errors as an Exhibit to the
   report.

2. If the number of errors noted in Step B above exceeded ten (10), make another
   selection as outlined in Step B.1 above, repeat Step B above and note in the
   report to AT&T. If errors exceeded ten (10) in this secondary selection and
   the effect of the errors equals or exceeds one percent (1%) of the fee to
   AT&T, notify Agency and AT&T that audit can not be completed.

F. All Other Expenses
   ------------------

   Use the definition of All Other Expenses (AOE) as defined in Article 6,
   Paragraph E to determine and report the actual AOE for the year being
   audited.

G. Representation Letter
   ---------------------

1. Obtain letter signed by the appropriate Agency representative which confirms
   management's responsibility for the fair presentation and calculation of the
   charges to AT&T, that management is not aware of any irregularities involving
   management or employees who have significant roles in the system of internal
   accounting control or any other irregularities involving other employees that
   could have a material effect on the charges to AT&T or any violations or
   possible violations of laws or regulations whose effects should be considered
   for disclosure or for recording a loss contingency, that there have been no
   communications from AT&T concerning noncompliance with or deficiencies in
   financial reporting practices that could have a material effect on the
   charges to AT&T and that no matters or occurrences have come to management's
   attention up to the date of the letter which would materially affect the
   charges to AT&T for the year the audit covers.

2. Clear draft of report with Agency prior to submission to AT&T, including
   applicable items noted in Step D above.

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

<PAGE>

                                                  MC941121LD
                                                  Schedule II
                                                  Page 1 of 5

                                  SCHEDULE II

                          NON-MEDIA BILLING SCHEDULE

Net out-of-pocket ("Net O-O-P") as used in this Schedule II shall mean the
amount of money the Agency pays to outside suppliers on behalf of AT&T based on
an authorized estimate.

A.  Charges for Publication Advertising and Outdoor Advertising

    1.  Preparation of rough layouts and copy      No Charge

    2.  Production of comprehensive layouts:

        - purchased from outside suppliers         Net O-O-P

        - produced by Agency personnel             Quoted in advance

    3.  Type composition, printing, engraving,
        electrotypes, finished art, photographs,
        photostats and other reproduction mats,
        stereotypes, quantity proofs:

        - purchased from outside suppliers         Net O-O-P

        - produced by Agency personnel             Quoted in advance

    4.  Endorsement fees, testimonials, etc.       Net O-O-P

    5.  Fashion Coordination performed by:

        - studio and/or stylist                    Net O-O-P

        - Agency personnel (Competitive Fee
          Schedule)                                Net O-O-P

    6.  Travel expenses of Agency personnel to     Net O-O-P
        supervise production, obtain testimonials
        and otherwise directly attributable to
        specific publication and outdoor
        advertising

    7.  Supervision and checking                   No Charge
<PAGE>

                                                          MC941121LD
                                                          Schedule II
                                                          Page 2 of 5

    8. Talent for use in test and/or finished      Net O-O-P
       advertising

    9. Production of test advertisements           Net O-O-P

   10. Research and licensing costs for stock      Net O-O-P
       photography

   11. Location scouting                           Net O-O-P

   12. All other elements required to produce      Net O-O-P
       publications and outdoor advertising
       not referred to above

B. Charges for Broadcast Advertising

    1. Preparation of copy and rough storyboards   No Charge
       by Agency for the Agency's presentation
       of creative executions

    2. Regular storyboards and reproduction
       copies of all regular storyboards and
       animatics:

       - purchased from outside suppliers          Net O-O-P

       - produced by Agency                        Quoted in advance

    3. Talent for use in programs and              Net O-O-P
       commercials when separately contracted
       for the Agency

    4. Packaged shows and films                    Net O-O-P

    5. Programs and scripts by outside             Net O-O-P
       speciality writers or producers

    6. Music rights, jingles, prize money,         Net O-O-P
       dramatic literary or musical adaptions
       or arrangements
<PAGE>

                                                      MC941121LD
                                                      Schedule II
                                                      Page 3 of 5

  7.  Previewing, auditioning, selecting,          No Charge
      negotiating, contracting of programs
      and talent

  8.  Producer's charges for filming, taping       Net O-O-P
      or recording commercials

  9.  Film production charges, studio and          Net O-O-P
      equipment rentals, scenery, props and
      costumes and location scouting

 10.  Fashion Coordination/hair and makeup:

      - by Agency personnel                        No Charge

      - by studio and/or stylist                   Net O-O-P

 11.  Release prints and duplicate tapes for       Net O-O-P
      distribution

 12.  Distribution of release prints and           Net O-O-P
      duplicate tapes

13.   Motion picture, slide and slidefilm          Net O-O-P
      processing

14.   Checking, including air checks               No Charge

15.   Endorsement fees, testimonials, etc.         Net O-O-P

16.   Travel expenses of Agency personnel to       Net O-O-P
      supervise production or expenses otherwise
      directly attributable to specific
      commercial production

17.   Music production associated with creative    Net O-O-P
      presentation, demos and test ads

18.  Talent, including voice over, associated      Net O-O-P
     with creative presentations, demos and
     test ads
<PAGE>

                                                       MC941121LD
                                                       Schedule II
                                                       Page 4 of 5

   19. Closed captioning expenses                  Net O-O-P

   20. All production costs for rough or test      Net O-O-P
       productions

   21. All other elements required to televise or
       broadcast television or radio commercials
       and not referred to above:

       -  purchased from outside suppliers         Net O-O-P

       - produced by Agency                        No Charge

C.  Postage, Express and Freight and Sales Taxes

    1. Incidental to normal business routine       No Charge
       between Agency and client home office

    2. Shipment of advertising materials to        Net O-O-P
       suppliers, media, etc.

    3. Sales Taxes                                 Net O-O-P

D.  Telephone, Teletype, Telegraph and Facsimile

    1. Incidental to normal business routine       No Charge
       between Agency and client home office

    2. Attributable to unusual service or to the   Net O-O-P
       production of specific advertising
       projects

E.  Research

    1. All research conducted by Agency unless     No Charge
       authorized by client

    2. All media research normally provided by     No Charge
       agencies
<PAGE>

                                                       MC941121LD
                                                       Schedule II
                                                       Page 5 of 5

    3.  Test materials                             Net O-O-P

    4.  Travel for Agency personnel to supervise,  Net O-O-P
        participate in and observe the research

F.  Free-Lance Creative/Technical Talent           Net O-O-P
<PAGE>

                                                 MC941121LD
                                                 Amendment No. 1
                                                 Page 1 of 1

                   ADVERTISING/MARKETING AGREEMENT AMENDMENT

AGREEMENT NUMBER: MC941121LD

AMENDMENT NUMBER: 1

AGENCY:  BRONNER SLOSBERG HUMPHREY INC.
         695 Atlantic Avenue
         Boston, Massachusetts 02111

Advertising/Marketing Agreement MC941121LD dated October 11, 1995 between
AT&T Communications, Inc. - Business Communications Services and Bronner
Slosberg Humphrey Inc., is hereby amended as follows:

Effective January 1, 1995, Article 7, Section A.3. is deleted in its entirety
and replaced with the following:

     Article 7.A.3
     For 1995 the yearly fee is [***]. For each subsequent year, the yearly
     fee shall be mutually agreed upon by the parties in writing and attached as
     an amendment hereto.

ALL OTHER TERMS AND CONDITIONS TO REMAIN UNCHANGED

Accepted:

BRONNER SLOSBERG                        AT&T COMMUNICATIONS, INC.
HUMPHREY INC.                           BUSINESS COMMUNICATIONS SERVICES

By: /s/ Robert E. Stoloff               By: /s/ David W. Robertson
    ------------------------------          ------------------------------

                                        David W. Robertson - Director/Adv.
---------------------------------       ----------------------------------
     (Name & Title-Printed)                   (Name & Title-Printed)

                                                      11/27/95
---------------------------------       ----------------------------------
             (Date)                                    (Date)

CONFIDENTIAL INFORMATION HAS BEEN OMITTED PURSUANT TO RULE 406 UNDER THE
SECURITIES ACT AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION. THE LOCATIONS OF THE OMITTED INFORMATION HAVE BEEN INDICATED WITH
ASTERISKS.

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