Document:

Exhibit 10.10

 

SECOND AMENDMENT TO AMENDED

BRANDED PRODUCT SUPPLY AGREEMENT

 

This Second Amendment (“Second Amendment”) to
the Amended Branded Product Supply Agreement dated November 12, 2003 is
entered into by and between Sealy Mattress Company (“Sealy”), Mattress Firm,
Inc. (“MFI”) and Mattress Firm Operating, Ltd. to be effective as of
March 31, 2004.

 

WHEREAS, Sealy and MFI entered into that
Amended Branded Product Supply Agreement, dated as of November 12, 2003
(“Current Agreement”);

 

WHEREAS, MFI is in the process of assigning
and otherwise transferring its Mattress Firm Stores located in the State of
Texas to Mattress Firm Operating, Ltd., a Texas limited partnership (“MFOL”)
who is an affiliate of MFI and is ultimately owned one hundred percent (100%)
by MFI;

 

WHEREAS, the parties desire that MFOL be
added as a party to the Current Agreement and bound by the rights and
obligations of MFI thereunder;

 

NOW THEREFORE, Sealy, MFI and MFOL hereby
agree as follows:

 

1.                                       For purposes of
the Current Agreement, all references to Mattress Firm, Inc. shall include
MFOL.

 

2.                                       MFOL hereby
agrees to be bound by the terms and conditions of the Current Agreement to the
extent that same apply to MFI Stores in the State of Texas.

 

3.                                       Except as
otherwise set forth herein, the terms and conditions of the Current Agreement
shall remain in full force and effect.

 

SIGNED AND ENTERED to be effective on the 31st
day of March, 2004.

 

 

	
   

  	
  SEALY MATTRESS COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth L. Walker

  
	
   

  	
   

  	
  Kenneth L. 
  Walker

  
	
   

  	
   

  	
  Corporate
  Vice President, General

  Counsel and Secretary

  

 

 

	
   

  	
  MATTRESS FIRM, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Fazio

  
	
   

  	
   

  	
  Gary Fazio

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MATTRESS FIRM OPERATING, LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  FESTRO, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Fazio

  
	
   

  	
   

  	
  Gary Fazio

  
	
   

  	
   

  	
  President

  

 

2Exhibit 10.11

 

REGISTRATION AGREEMENT

 

THIS REGISTRATION AGREEMENT
(this “Agreement”) is made as of March 24, 2003, by and among
Mattress Holding Corp., a Delaware corporation (the “Company”), Sun
Mattress, LLC, a Delaware limited liability company (“Sun”), and each of
the other Persons listed on the signature pages attached hereto (the “Other
Investors”).  Sun and the Other
Investors are collectively referred to herein as the “Stockholders,” and
are individually referred to herein as a “Stockholder.”  Otherwise undefined capitalized terms used
herein are defined in Section 9 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 Agreement hereby agree as follows:

 

1.                                       Demand Registrations.

 

(a)                                  Requests for Registration.  At
any time, the holders of at least a majority of the Sun Registrable Securities
may request registration under the Securities Act of all or any portion of such
Sun Registrable Securities on Form S-1 or any similar long-form registration
statement (“Long-Form Registrations”) or, if available, on Form S-2 or
S-3 or any similar short-form registration statement (“Short-Form
Registrations”).  All registrations
requested pursuant to this Section 1(a) are referred to herein as “Demand
Registrations.”  Each request for a
Demand Registration shall specify the approximate number of Registrable
Securities requested to be registered and the anticipated per share price range
for such offering.  Within ten days after
receipt of any such request, the Company shall give written notice of such
requested registration to all other holders of Registrable Securities and, subject
to Section 1(d) below, will include in such registration, in
addition to the Sun Registrable Securities that are requested to be registered
pursuant hereto, all Other Registrable Securities with respect to which the
Company has received written requests for inclusion therein within 15 days
after the receipt of the Company’s notice.

 

(b)                                 Long-Form Registrations.  The
holders of a majority of the Sun Registrable Securities shall be entitled to
request unlimited Long-Form Registrations in which the Company will pay all
Registration Expenses (as defined below in Section 5).  All Long-Form Registrations shall be
underwritten registrations.

 

(c)                                  Short-Form Registrations.  In
addition to the Long-Form Registrations provided pursuant to Section 1(b),
the holders of a majority of the Sun Registrable Securities shall be entitled
to request an unlimited number of Short-Form Registrations in which the Company
will pay all Registration Expenses. 
Demand Registrations will be Short-Form Registrations whenever the Company
is permitted to use any applicable short form. 
After the Company has become subject to the reporting requirements of
the Securities Exchange Act of 1934, as amended, the Company shall use its best
efforts to make Short-Form Registrations on Form S-3 available for the sale of
Registrable Securities.  All Short-Form
Registrations shall be underwritten registrations, unless otherwise agreed to
by the Company

 

(d)                                 Priority on Demand Registrations.  The
Company will not include in any Demand Registration any securities which are
not Registrable Securities without the prior written

 

 

consent of the holders of a
majority of the Registrable Securities included in such registration.  If a Demand Registration is an underwritten
offering and the managing underwriters advise the Company in writing that, in
their opinion, the number of Registrable Securities and, if permitted
hereunder, other securities requested to be included in such offering, exceeds
the number of Registrable Securities and other securities, if any, which can be
sold therein without adversely affecting the marketability of the offering, the
Company will include in such registration (i) first, the number of Registrable
Securities requested to be included in such registration which in the opinion
of such underwriters can be sold without adverse effect, pro rata among the
respective holders thereof on the basis of the number of Registrable Securities
owned by each such holder, and (ii) second, other securities requested to be
included in such Demand Registration, pro rata among the holders of such
securities on the basis of the number of such securities owned by each such
holder.

 

(e)                                  Restrictions on Demand Registrations.  The
Company will not be obligated to effect any Demand Registration within six
months after the effective date of a previous Long-Form Registration with
respect to securities offered by the Company for its own account.  The Company may postpone, for up to six
months (from the date of the request), the filing or the effectiveness of a
registration statement for a Demand Registration if the Company’s board of
directors believes, in good faith, that such Demand Registration would
reasonably be expected to have an adverse effect on any proposal or plan by the
Company or any Subsidiary thereof to engage in any acquisition of assets (other
than in the ordinary course of business) or any stock purchase, merger,
consolidation, tender offer, reorganization, or similar transaction; provided,
however, that in such event, the holders of Registrable Securities
initially requesting such Demand Registration will be entitled to withdraw such
request and, if such request is withdrawn, such Demand Registration shall be
treated as if it had never been made in the first instance, and the Company
will pay all Registration Expenses in connection with such registration.  The Company may delay a Demand Registration
hereunder only once in any 12-month period.

 

(f)                                    Selection of Underwriters.  The
holders of a majority of the Registrable Securities initially requesting
registration hereunder will have the right to select the investment banker(s)
and manager(s) to administer the offering under such Demand Registration,
subject to the Company’s approval, which will not be unreasonably withheld.

 

(g)                                 Other Registration Rights. 
Except as provided in this Agreement, the Company will not grant to any
Persons the right to request that the Company register any equity securities of
the Company, or any securities convertible into or exchangeable or exercisable
for any such securities, without the prior written consent of the holders of at
least a majority of the Registrable Securities.

 

2.                                       Piggyback Registrations.

 

(a)                                  Right to Piggyback. 
Whenever the Company proposes to register any of its equity securities
under the Securities Act (other than pursuant to a Demand Registration or a
registration on Form S-4 or S-8 or any successor or similar forms) and the
registration form to be used may be used for the registration of Registrable
Securities (a “Piggyback Registration”), whether or not for sale for its
own account, the Company will give prompt written notice to all

 

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holders of Registrable
Securities of its intention to effect such a registration and, subject to Sections
2(c) and 2(d) below, will include in such registration all Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within 10 days after the receipt of the Company’s notice.

 

(b)                                 Piggyback Expenses.  In
all Piggyback Registrations, the Registration Expenses of the holders of
Registrable Securities will be paid by the Company.

 

(c)                                  Priority on Primary Registrations.  If a
Piggyback Registration is an underwritten primary registration on behalf of the
Company, and the managing underwriters advise the Company in writing (with a
copy to each party hereto requesting registration of Registrable Securities)
that, in their opinion, the number of securities requested to be included in
such registration exceeds the number which can be sold in such offering without
adversely affecting the marketability of such offering, the Company will
include in such registration (i) first, the securities that the Company
proposes to sell, (ii) second, the Registrable Securities requested to be
included in such registration, pro  rata among the holders thereof
on the basis of the number of Registrable Securities owned by each such holder,
and (iii) third, other securities requested to be included in such registration
pro rata among the holders of such securities on the basis of the number of
such other securities owned by each such holder.

 

(d)                                 Priority on Secondary Registrations.  If a
Piggyback Registration is an underwritten secondary registration on behalf of
holders of the Company’s securities (it being understood that secondary
registrations on behalf of holders of Registrable Securities are addressed in Section 1
above rather than in this Section 2(d)), and the managing
underwriters advise the Company in writing that, in their opinion, the number
of securities requested to be included in such registration exceeds the number
which can be sold in such offering without adversely affecting the
marketability of the offering, the Company will include in such registration
(i) first, the securities requested to be included therein by the holders
requesting such registration, (ii) second, the Registrable Securities requested
to be included in such registration, pro rata among the holders of such
Registrable Securities on the basis of the number of Registrable Securities
owned by each such requesting holder, and (iii) third, other securities
requested to be included in such registration pro rata among the holders of
such other securities on the basis of the number of such securities owned by
each such holder.

 

(e)                                  Selection of Underwriters.  If
any Piggyback Registration is an underwritten offering, the selection of the
investment banker(s) and manager(s) for the offering must be approved by the
holders of a majority of the Registrable Securities included in such Piggyback
Registration, which approval shall not be unreasonably withheld.

 

(f)                                    Withdrawal by Company.  If,
at any time after giving notice of its intention to register any of its
securities as set forth in Section 2(a) and before the effective
date of such registration statement filed in connection with such registration,
the Company shall determine, for any reason, not to register such securities,
the Company may, at its sole discretion, give written notice of such
determination to each holder of Registrable Securities and thereupon shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses in connection therewith as provided herein).

 

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(g)                                 Other Registrations.  If
the Company has previously filed a registration statement with respect to
Registrable Securities pursuant to Section 1 or pursuant to this Section 2,
and if such previous registration has not been withdrawn or abandoned, the
Company will not file or cause to be effected any other registration of any of
its equity securities or securities convertible into or exchangeable or
exercisable for its equity securities under the Securities Act (except on Form
S-4 or S-8 or any successor form), whether on its own behalf or at the request
of any holder or holders of such securities, until a period of at least six
months has elapsed from the effective date of such previous registration.

 

3.                                       Holdback Agreements.

 

(a)                                  Each holder of Registrable Securities agrees
not to effect any public sale or distribution (including sales pursuant to Rule
144) of equity securities of the Company, or any securities, options, or rights
convertible into or exchangeable or exercisable for such securities, during the
seven days before and the 180-day period beginning on the effective date of any
underwritten public offering of the Company’s equity securities (including
Demand and Piggyback Registrations) (except as part of such underwritten
registration), unless the underwriters managing the registered public offering
otherwise agree.

 

(b)                                 The Company agrees (i) not to effect any
public sale or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such securities, during the
seven days before and during the 180-day period beginning on the effective date
of any underwritten public offering of the Company’s equity securities
(including Demand and Piggyback Registrations) (except as part of such
underwritten registration or pursuant to registrations on Form S-4 or S-8 or
any successor form), unless the underwriters managing the registered public
offering otherwise agree, and (ii) to cause each holder of its Common Stock, or
any securities convertible into or exchangeable or exercisable for Common
Stock, purchased or otherwise acquired from the Company at any time after the
date of this Agreement (other than in a registered public offering) to agree
not to effect any public sale or distribution (including sales pursuant to Rule
144) of any such securities during any such period (except as part of such
underwritten registration, if otherwise permitted), unless the underwriters
managing the registered public offering otherwise agree.

 

4.                                       Registration Procedures. 
Whenever the holders of Registrable Securities have requested that any
Registrable Securities be registered pursuant to this Agreement, the Company
will use its best efforts to effect the registration and the sale of such
Registrable Securities in accordance with the intended method of disposition
thereof and, pursuant thereto, the Company will as expeditiously as possible:

 

(a)                                  prepare and (within 60 days after the end of
the period within which requests for registration may be given to the Company)
file with the Securities and Exchange Commission a registration statement with
respect to such Registrable Securities and thereafter use its best efforts to
cause such registration statement to become effective (provided that, before
filing a registration statement or prospectus or any amendments or supplements
thereto, the Company will furnish to the counsel selected by the holders of a
majority of the Registrable Securities covered by such registration statement
copies of all such documents proposed to be filed, which documents will be
subject to review of such counsel);

 

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(b)                                 prepare and file with the Securities and
Exchange Commission such amendments and supplements to such registration statement
and the prospectus used in connection therewith as may be necessary to keep
such registration statement effective for a period of either (i) not less than
six months (subject to extension pursuant to Section 7(b)) or, if
such registration statement relates to an underwritten offering, such longer
period as in the opinion of counsel for the underwriters a prospectus is
required by law to be delivered in connection with sales of Registrable
Securities by an underwriter or dealer, or (ii) such shorter period as will
terminate when all of the securities covered by such registration statement
during such period have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof set forth in such
registration statement (but, in any event, not before the expiration of any
longer period required under the Securities Act), and to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement until such time as all of
such securities have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof set forth in such registration
statement;

 

(c)                                  furnish to each seller of Registrable
Securities such number of copies of such registration statement, each amendment
and supplement thereto, the prospectus included in such registration statement
(including each preliminary prospectus), and such other documents as such
seller may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such seller;

 

(d)                                 use its best efforts to register or qualify
such Registrable Securities under such other securities or blue sky laws of
such jurisdictions as any seller reasonably requests and do any and all other
acts and things which may be reasonably necessary or advisable to enable such
seller to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that the Company will not be required
to (i) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subsection, (ii) subject itself
to taxation in any such jurisdiction, or (iii) consent to general service of
process in any such jurisdiction);

 

(e)                                  notify each seller of such Registrable
Securities, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, upon discovery that, or upon the discovery
of the happening of any event as a result of which, the prospectus included in
such registration statement contains an untrue statement of a material fact or
omits any fact necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, and, at the request of
any such seller, the Company will prepare and furnish to such seller a
reasonable number of copies of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain an untrue statement of a material fact or omit
to state any fact necessary to make the statements therein not misleading in
the light of the circumstances under which they were made;

 

(f)                                    use best efforts to cause all such Registrable
Securities to be listed on each securities exchange on which similar securities
issued by the Company are then listed and, if not so listed, to be listed on a
securities exchange or the National Association of Securities Dealers (“NASD”)
automated quotation system

 

5

 

and, if listed on the NASD
automated quotation system, use its best efforts to secure designation of all
such Registrable Securities covered by such registration statement as a
“national market system security” of The Nasdaq Stock Market within the meaning
of Rule 11Aa2-1 of the Securities and Exchange Commission or, failing that, to
secure The Nasdaq Stock Market’s authorization for such Registrable Securities
and, without limiting the generality of the foregoing, to arrange for at least
two market makers to register as such with respect to such Registrable
Securities with the NASD;

 

(g)                                 use best efforts to provide a transfer agent
and registrar for all such Registrable Securities not later than the effective
date of such registration statement;

 

(h)                                 enter into such customary agreements
(including underwriting agreements in customary form) and take all such other
actions as the holders of a majority of the Registrable Securities being sold
or the underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities (including, without
limitation, effecting a stock split, combination of shares, recapitalization,
or reorganization);

 

(i)                                     make available for inspection by any seller
of Registrable Securities, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney, accountant, or other
agent retained by any such seller or underwriter, all financial and other
records, pertinent corporate and business documents and properties of the
Company, and cause the Company’s officers, directors, employees, agents,
representatives, and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant, or
agent in connection with such registration statement;

 

(j)                                     otherwise use its best efforts to comply with
all applicable rules and regulations of the Securities and Exchange Commission,
and make available to its security holders, as soon as reasonably practicable,
an earnings statement covering the period of at least 12 months, beginning with
the first day of the Company’s first full calendar quarter after the effective
date of the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;

 

(k)                                  permit any holder of Registrable Securities
which holder, in its sole and exclusive judgment, might be deemed to be an
underwriter or a controlling person of the Company to participate in the
preparation of such registration or comparable statement and to require the
insertion therein of material, furnished to the Company in writing, which in
the reasonable judgment of such holder and its counsel should be included;

 

(l)                                     in the event of the issuance of any stop
order suspending the effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any securities included in such registration statement for
sale in any jurisdiction, the Company will use its best efforts promptly to
obtain the withdrawal of such order;

 

(m)                               use its best efforts to cause such
Registrable Securities covered by such registration statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the sellers thereof to consummate the disposition of such
Registrable Securities;

 

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(n)                                 use best efforts to obtain a cold comfort
letter from the Company’s independent public accountants in customary form and
covering such matters of the type customarily covered by cold comfort letters,
which letter shall be addressed to the underwriters, and the Company shall use
its best efforts to cause such cold comfort letter to also be addressed to the
holders of such Registrable Securities; and

 

(o)                                 use best efforts to obtain an opinion from
the Company’s outside counsel in customary form and covering such matters of
the type customarily covered by such opinions, which opinion shall be addressed
to the underwriters and the holders of such Registrable Securities.

 

If any such registration or
comparable statement refers to any holder by name or otherwise as the holder of
any securities of the Company and if such holder, in its sole and exclusive
judgment, is or might be deemed to be an underwriter or a controlling person of
the Company, such holder shall have the right to require (i) the insertion therein
of language, in form and substance satisfactory to such holder and presented to
the Company in writing, to the effect that the holding by such holder of such
securities is not to be construed as a recommendation by such holder of the
investment quality of the Company’s securities covered thereby, and that such
holding does not imply that such holder shall assist in meeting any future
financial requirements of the Company, or (ii) in the event that such reference
to such holder by name or otherwise is not required by the Securities Act or
any similar federal or state statute then in force, the deletion of the
reference to such holder, provided that, with respect to this clause (ii), such
holder shall furnish to the Company an opinion of counsel to such effect, which
opinion and counsel shall be reasonably satisfactory to the Company.  The Company may require each seller of
Registrable Securities as to which any registration is being effected to
furnish the Company with such information regarding such seller and the
distribution of such securities as the Company may from time to time reasonably
request in writing.

 

5.                                       Registration Expenses.

 

(a)                                  All expenses incident to the Company’s
performance of or compliance with this Agreement, including, without limitation,
all registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, printing expenses, messenger and delivery
expenses, fees and disbursements of custodians, fees and disbursements of
counsel for the Company, and all independent certified public accountants,
underwriters (excluding discounts and commissions), and other Persons retained
by the Company (all such expenses being herein called “Registration Expenses”),
will be borne as provided in this Agreement, except that the Company will, in
any event, pay its internal expenses (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit or quarterly review, the
expense of any liability insurance, and the expenses and fees for listing the
securities to be registered on each securities exchange on which similar
securities issued by the Company are then listed or, if none are so listed, on
a securities exchange or the NASD automated quotation system.

 

(b)                                 In connection with each Demand Registration
and each Piggyback Registration, the Company shall reimburse the holders of
Registrable Securities included in such

 

7

 

registration for the
reasonable fees and disbursements of one counsel chosen by the holders of a
majority of the Registrable Securities included in such registration.

 

(c)                                  To the extent Registration Expenses are not
required to be paid by the Company, each holder of securities included in any
registration hereunder will pay those Registration Expenses allocable to the
registration of such holder’s securities so included, and any Registration
Expenses not so allocable will be borne by all sellers of securities included
in such registration in proportion to the aggregate selling price of each
seller’s securities to be so registered.

 

6.                                       Indemnification.

 

(a)                                  The Company agrees to indemnify and hold
harmless, to the full extent permitted by law, each holder of Registrable
Securities, its officers, directors, members, agents, and employees and each
Person who controls such holder (within the meaning of the Securities Act)
against any and all losses, claims, damages, liabilities, joint or several,
together with reasonable costs and expenses (including reasonable attorney’s
fees), to which such indemnified party may become subject under the Securities
Act or otherwise, insofar as such losses, claims, damages, or liabilities (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of, are based upon, are caused by, or result from (i) any untrue or
alleged untrue statement of material fact contained (A) in any registration
statement, prospectus, or preliminary prospectus or any amendment thereof or
supplement thereto, or (B) in any application or other document or
communication (in this Section 6 collectively called an “application”)
executed by or on behalf of the Company or based upon written information
furnished by or on behalf of the Company filed in any jurisdiction in order to
qualify any securities covered by such registration statement under the “blue
sky” or securities laws thereof, or (ii) any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and the Company will reimburse such holder and each
such director, officer, member, agent and employee for any legal or any other
expenses incurred by them in connection with investigating or defending any
such loss, claim, liability, action, or proceeding; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof), or
expense arises out of, is based upon, is caused by, or results from an untrue
statement or alleged untrue statement, or omission or alleged omission, made in
such registration statement, any such prospectus or preliminary prospectus or
any amendment or supplement thereto, or in any application, in reliance upon,
and in conformity with, written information prepared and furnished to the
Company by such holder or other indemnified party expressly for use therein or
by such holder’s failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such holder with a sufficient number of copies of the same.  In connection with any underwritten offering,
the Company will indemnify such underwriters, their officers and directors, and
each Person who controls such underwriters (within the meaning of the
Securities Act) to the same extent as provided above with respect to the
indemnification of the holders of Registrable Securities.

 

(b)                                 In connection with any registration statement
in which a holder of Registrable Securities is participating, each such holder
will furnish to the Company in writing

 

8

 

such information and
affidavits as the Company reasonably requests for use in connection with any
such registration statement or prospectus and, to the full extent permitted by
law, will indemnify and hold harmless the other holders of Registrable
Securities and the Company, and their respective directors, officers, members,
agents, and employees and each other Person who controls the Company (within
the meaning of the Securities Act) against any losses, claims, damages,
liabilities, joint or several, together with reasonable costs and expenses
(including reasonable attorney’s fees), to which such indemnified party may
become subject under the Securities Act or otherwise, insofar as such losses,
claims, damages, or liabilities (or actions or proceedings, whether commenced
or threatened, in respect thereof) arise out of, are based upon, are caused by,
or result from (i) any untrue or alleged untrue statement of material fact
contained in the registration statement, prospectus or preliminary prospectus
or any amendment thereof or supplement thereto or in any application, or (ii) any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading, but only to the
extent that such untrue statement or omission is made in such registration
statement, any such prospectus or preliminary prospectus or any amendment or
supplement thereto, or in any application, in reliance upon and in conformity
with written information prepared and furnished to the Company by such holder
expressly for use therein; provided, however, that the obligation to indemnify
will be individual to each holder and will be limited to the net amount of
proceeds received by such holder from the sale of Registrable Securities
pursuant to such registration statement.

 

(c)                                  Any Person entitled to indemnification
hereunder will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification (provided that the failure
to give prompt notice shall not impair any Person’s right to indemnification
hereunder to the extent such failure has not prejudiced the indemnifying
party), and (ii) unless in such indemnified party’s reasonable judgment a
conflict of interest between such indemnified and indemnifying parties may
exist with respect to such claim, permit such indemnifying party to assume the
defense of such claim with counsel reasonably satisfactory to the indemnified
party.  If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent will not be
unreasonably withheld).  An indemnifying
party who is not entitled to, or elects not to, assume the defense of a claim
will not be obligated to pay the fees and expenses of more than one counsel for
all parties indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim.

 

(d)                                 The indemnifying party shall not, except with
the approval of each indemnified party, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to each indemnified party of a
release from all liability in respect to such claim or litigation without any
payment or consideration provided by such indemnified party.

 

(e)                                  If the indemnification provided for in this Section 6
is unavailable to, or is insufficient to hold harmless, an indemnified party
under the provisions above in respect to any losses, claims, damages, or
liabilities referred to therein, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of such
losses,

 

9

 

claims, damages, or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the sellers of Registrable
Securities and any other sellers participating in the registration statement on
the other hand from the sale of Registrable Securities pursuant to the
registered offering of securities as to which indemnity is sought, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and of the sellers of Registrable Securities and any other sellers
participating in the registration statement on the other hand in connection
with the registration statement on the other in connection with the statement
or omissions which resulted in such losses, claims, damages, or liabilities, as
well as any other relevant equitable considerations.  The relative benefits received by the Company
on the one hand and the sellers of Registrable Securities and any other sellers
participating in the registration statement on the other hand shall be deemed
to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) to the Company bear to the total net proceeds from
the offering (before deducting expenses) to the sellers of Registrable
Securities and any other sellers participating in the registration
statement.  The relative fault of the
Company on the one hand and of the sellers of Registrable Securities and any
other sellers participating in the registration statement on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged omission to state a material fact relates to information supplied by
the Company or by the sellers of Registrable Securities or other sellers
participating in the registration statement and the parties’ relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission.

 

(f)                                    The Company and the sellers of Registrable
Securities agree that it would not be just and equitable if contribution
pursuant to this Section 6 were determined by pro  rata
allocation (even if the sellers of Registrable Securities were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph.  The amount paid or
payable by an indemnified party as a result of the losses, claims, damages, and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim.  Notwithstanding the provisions of this Section 6,
no seller of Registrable Securities shall be required to contribute any amount
in excess of the net proceeds received by such seller from the sale of
Registrable Securities covered by the registration statement filed pursuant
hereto.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation.

 

(g)                                 The indemnification and contribution by any
such party provided for under this Agreement shall be in addition to any other
rights to indemnification or contribution which any indemnified party may have
pursuant to law or contract and will remain in full force and effect regardless
of any investigation made or omitted by or on behalf of the indemnified party
or any officer, director, employee or controlling Person of such indemnified
party and will survive the transfer of securities.

 

10

 

7.                                       Participation in Underwritten Registrations.

 

(a)                                  No Person may participate in any registration
hereunder which is underwritten unless such Person (i) agrees to sell such
Person’s securities on the basis provided in any underwriting arrangements
approved by the Person or Persons entitled hereunder to approve such
arrangements (including, without limitation, pursuant to the terms of any
over-allotment or “green shoe” option requested by the managing underwriter(s);
provided that no holder of Registrable Securities will be required to sell more
than the number of Registrable Securities that such holder has requested the
Company to include in any registration), and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements, and
other documents reasonably required under the terms of such underwriting
arrangements.

 

(b)                                 Each Person that is participating in any
registration hereunder agrees that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section 4(e)
above, such Person will forthwith discontinue the disposition of its
Registrable Securities pursuant to the registration statement until such
Person’s receipt of the copies of a supplemented or amended prospectus as
contemplated by such Section 4(e). 
In the event that the Company shall give any such notice, the applicable
time period mentioned in Section 4(b) during which a Registration
Statement is to remain effective shall be extended by the number of days during
the period from and including the date of the giving of such notice pursuant to
this Section 7 to and including the date when each seller of a
Registrable Security covered by such registration statement shall have received
the copies of the supplemented or amended prospectus contemplated by Section 4(e).

 

8.                                       Current Public Information.  At
all times after the Company has filed a registration statement with the
Securities and Exchange Commission pursuant to the requirements of either the
Securities Act or the Securities Exchange Act, the Company will file all
reports required to be filed by it under the Securities Act and the Securities
Exchange Act and the rules and regulations adopted by the Securities and
Exchange Commission thereunder, and will take such further action as any holder
or holders of Registrable Securities may reasonably request, all to the extent
required to enable such holders to sell Registrable Securities pursuant to Rule
144 adopted by the Securities and Exchange Commission under the Securities Act
(as such rule may be amended from time to time) or any similar rule or
regulation hereafter adopted by the Securities and Exchange Commission.

 

9.                                       Definitions

 

“Common Stock” shall
mean the Non-Voting Common Stock and the Voting Common Stock.

 

“NASD” shall have the
meaning set forth in Section 3(f).

 

“Non-Voting Common Stock”
shall mean the Non-Voting Common Stock of the Company as constituted on the
date hereof and any stock into which any such Non-Voting Common Stock shall
have been changed or any stock resulting from any reclassification of any such
Non-Voting Common Stock.

 

11

 

“Other Registrable
Securities” means (i) all shares of Common Stock of the Company originally
issued, directly or indirectly, to any Other Investor, (ii) all shares of Common
Stock of the Company issued or issuable, directly or indirectly, with respect
to the securities referred to in clause (i) above upon exercise, conversion, or
exchange or by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation, or other
reorganization, and (iii) any other shares of Common Stock of the Company held
by Persons holding securities described in clauses (i) and (ii) above.  As to any particular Other Registrable
Securities, such securities shall cease to be Other Registrable Securities when
they have been distributed to the public pursuant to an offering registered
under the Securities Act or sold to the public through a broker, dealer, or
market maker in compliance with Rule 144 under the Securities Act (or any
similar rule then in force) or repurchased by the Company or any Subsidiary
thereof or purchased or otherwise acquired by Sun, and, if such Other
Registrable Securities are purchased or otherwise acquired by Sun, then such
Other Registrable Securities shall be deemed Sun Registrable Securities.  For purposes of this Agreement, a Person
shall be deemed to be a holder of Other Registrable Securities, and the Other
Registrable Securities shall be deemed to be in existence, whenever such Person
has the right to acquire, directly or indirectly, such Other Registrable
Securities (upon conversion or exercise in connection with a transfer of
securities or otherwise, but disregarding any restrictions or limitations upon
the exercise of such right other than vesting), whether or not such acquisition
has actually been effected, and such Person shall be entitled to exercise the
rights of a holder of Other Registrable Securities hereunder.

 

“Person” shall mean
an individual, a corporation, a limited liability company, an association, a
joint-stock company, a business trust or other similar organization, a
partnership, a joint venture, a trust, an unincorporated organization or a
government or any agency, instrumentality or political subdivision thereof.

 

“Registrable Securities”
means, collectively, the Sun Registrable Securities and the Other Registrable
Securities.

 

“Securities Act”
shall mean the Securities Act of 1933, as amended, or any successor federal
statute, and the rules and regulations promulgated thereunder, all as amended,
modified or supplemented from time to time.

 

“Securities and Exchange
Commission” includes any governmental body or agency succeeding to the
functions thereof.

 

“Securities Exchange Act”
means the Securities Exchange Act of 1934, as amended, or any similar federal
law then in force.

 

“Subsidiary” or
“Subsidiaries” means, with respect to any Person, any corporation, limited
liability company, partnership, association, or other business entity of which
(i) if a corporation, a majority of the total voting power of shares of stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers, or trustees thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the other
Subsidiaries of such Person or a combination thereof, or (ii) if a limited
liability company, partnership, association, or other business entity, a
majority of the partnership

 

12

 

or other similar ownership
interest thereof is at the time owned or controlled, directly or indirectly, by
any Person or one or more Subsidiaries of such Person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have a majority
ownership interest in a limited liability company, partnership, association, or
other business entity if such Person or Persons shall be allocated a majority
of limited liability company, partnership, association, or other business
entity gains or losses or shall be or control any managing director or general
partner of such limited liability company, partnership, association, or other
business entity.

 

“Sun Registrable
Securities” means (i) all shares of Common Stock of the Company originally
issued, directly or indirectly, to Sun, (ii) all shares of Common Stock of the
Company issued or issuable, directly or indirectly, with respect to the
securities referred to in clause (i) above upon exercise, conversion, or
exchange or by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation, or other
reorganization, and (iii) all other shares of Common Stock of the Company held
by Persons holding securities described in clauses (i) and (ii) above.  As to any particular Sun Registrable
Securities, such securities shall cease to be Sun Registrable Securities when
they have been distributed to the public pursuant to an offering registered
under the Securities Act or sold to the public through a broker, dealer, or
market maker in compliance with Rule 144 under the Securities Act (or any
similar rule then in force) or repurchased by the Company or any Subsidiary
thereof or purchased or otherwise acquired by any employee of the Company, and,
if such Sun Registrable Securities are purchased or otherwise acquired by any
employee of the Company, then such Sun Registrable Securities shall be deemed
Other Registrable Securities.  For purposes
of this Agreement, a Person shall be deemed to be a holder of Sun Registrable
Securities, and the Sun Registrable Securities shall be deemed to be in
existence, whenever such Person has the right to acquire directly or indirectly
such Sun Registrable Securities (upon conversion or exercise in connection with
a transfer of securities or otherwise, but disregarding any restrictions or
limitations upon the exercise of such right), whether or not such acquisition
has actually been effected, and such Person shall be entitled to exercise the
rights of a holder of Sun Registrable Securities hereunder.

 

“Voting Common Stock”
shall mean the Voting Common Stock of the Company as constituted on the date
hereof and any stock into which any such Voting Common Stock shall have been
changed or any stock resulting from any reclassification of any such Voting
Common Stock.

 

10.                                 Miscellaneous.

 

(a)                                  No Inconsistent Agreements.  The
Company will not hereafter enter into any agreement with respect to the
Company’s securities which is inconsistent with or violates the rights granted
to the holders of Registrable Securities in this Agreement.

 

(b)                                 Adjustments Affecting Registrable Securities. 
Except as provided in Section 10(c), The Company will not
take any action, or permit any change to occur, with respect to the Company’s
securities which would materially and adversely affect the ability of the
holders of Registrable Securities to include such Registrable Securities in a
registration undertaken pursuant to this Agreement or which would adversely
affect the marketability of such

 

13

 

Registrable Securities in
any such registration (including, without limitation, effecting a stock split,
combination of shares, or other recapitalization).

 

(c)                                  Amendment and Waiver.  Except
as otherwise provided herein, no modification, amendment, or waiver of any
provision of this Agreement will be effective against the Company or the
holders of Registrable Securities, unless such modification, amendment, or
waiver is approved in writing by the Company and the holders of at least a
majority of the Sun Registrable Securities; provided, however,
that in the event that such amendment or waiver would materially and adversely
affect a holder or group of holders of Registrable Securities in a manner
substantially different than any other holders of Registrable Securities, then
such amendment or waiver will require the consent of such holder of Registrable
Securities or a majority of the Registrable Securities held by such group of
holders materially and adversely affected. 
The failure of any party to enforce any of the provisions of this
Agreement will in no way be construed as a waiver of such provisions and will
not affect the right of such party thereafter to enforce each and every
provision of this Agreement in accordance with its terms.

 

(d)                                 Severability. 
Whenever possible, each provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal, or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality, or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed, construed, and
enforced in such jurisdiction as if such invalid, illegal, or unenforceable
provision had never been contained herein.

 

(e)                                  Entire Agreement. 
Except as otherwise expressly set forth herein, this Agreement, those
documents expressly referred to herein, and the other documents of even date
herewith embody the complete agreement and understanding among the parties and
supersede and preempt any prior understandings, agreements, or representations
by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.

 

(f)                                    Successors and Assigns.  This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective heirs, executors, successors and
assigns.  In addition, and whether or not
any express assignment shall have been made, the provisions of this Agreement
which are for the benefit of the holders of Registrable Securities (or any
portion thereof) as such shall be for the benefit of, and enforceable by, any
subsequent holder of any Registrable Securities (or of such portion thereof).

 

(g)                                 Counterparts.  This
Agreement may be executed in separate counterparts each of which will be an
original and all of which taken together shall constitute one and the same
agreement.

 

(h)                                 Remedies.  Any Person having rights under
any provision of this Agreement shall be entitled to enforce their rights under
this Agreement specifically to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights existing in their
favor; provided, however the parties hereto stipulate that the remedies
at law of any party hereto in the event of any default or threatened default by
any other party hereto in the performance of or compliance with the terms
hereof are not and will not be adequate and

 

14

 

that, to the fullest extent
permitted by law, such terms may be specifically enforced (without posting a
bond or other security) by a decree for the specific performance thereof,
whether by an injunction against violation thereof or otherwise.

 

(i)                                     Notices.  All communications provided
for herein shall be in writing and sent (a) by facsimile if the sender on the
same day sends a confirming copy of such communication by a recognized
overnight delivery service (charges prepaid), (b) by a recognized overnight
delivery service (charges prepaid), or (c) by messenger.  The respective addresses of the parties
hereto for the purposes of this Agreement are set forth on Exhibit A
attached hereto.  Any party may change
its address (or facsimile number) by notice to each of the other parties in
accordance with this Section 10(i). 
Notice shall be deemed given (and received) on the date of service or
transmission if personally served or transmitted by telegram, telex or
facsimile (with confirmation of successful transmission obtained); provided,
that if such service or transmission is not on a business day or is after
normal business hours, then such notice shall be deemed given (and received) on
the next business day.  Notice otherwise
sent as provided herein shall be deemed given (and received) on the next
business day following timely delivery of such notice to a reputable air
courier service.

 

(j)                                     Governing Law; Jurisdiction; Waiver of Jury
Trial.  This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of Delaware without
giving effect to any choice or conflict of law provision or rule (whether of
the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of
Delaware.  Each party hereto submits to
the jurisdiction of any state or federal court sitting in the State of
Delaware, in any action or proceeding arising out of or relating to this
Agreement and agrees that all claims in respect of the action or proceeding may
be heard and determined in any such court. 
Each party also agrees not to bring any action or proceeding arising out
of or relating to this Agreement in any other court.  Each party hereto waives any defense of
inconvenient forum to the maintenance of any action or proceeding so brought
and waives any bond, surety, or other security that might be required of any
other party with respect thereto.  Any
party may make service on any other party by sending or delivering a copy of
the process to the party to be served at the address and in the manner provided
for the giving of notices in Section 10(i) above.  Nothing in this Section 10(j),
however, shall affect the right of any party to bring any action or proceeding
arising out of or relating to this Agreement in any other court or to serve
legal process in any other manner permitted by law or at equity.  Each party agrees that a final judgment in
any action or proceeding so brought shall be conclusive and may be enforced by
suit on the judgment or in any other manner provided by law or at equity.  EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY SUIT, ACTION OR OTHER PROCEEDING INSTITUTED
BY OR AGAINST SUCH PARTY IN RESPECT OF ITS, HIS OR HER OBLIGATIONS HEREUNDER OR
THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(k)                                  No Strict Construction.  The
language used in this Agreement shall be deemed to be the language chosen by
the parties hereto to express their mutual intent, and no rule of strict
construction shall be applied against any party.

 

(l)                                     Business Days.  If
any time period for giving notice or taking action hereunder expires on a day
which is a Saturday, Sunday or legal holiday in the state in which the

 

15

 

Company’s chief executive
office is located, the time period shall automatically be extended to the
business day immediately following such Saturday, Sunday or legal holiday.

 

(m)                               Descriptive Headings.  The
descriptive headings of this Agreement are inserted for convenience only and do
not constitute a part of this Agreement.

 

[The
next page is the signature page]

 

16

 

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

 

	
   

  	
  MATTRESS HOLDING CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ M. Steven Liff

  
	
   

  	
  M. Steven Liff

  
	
   

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SUN MATTRESS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ M. Steven Liff

  
	
   

  	
   

  	
   M.
  Steven Liff

  
	
   

  	
   

  	
   Vice
  President

  
				

 

 

OTHER INVESTORS:

 

 

	
   

  	
  /s/Gary T. Fazio

  
	
   

  	
  Gary T. Fazio

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jim R. Black

  
	
   

  	
  Jim R. Black

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ James Gerard Ruehlmann

  
	
   

  	
  James Gerard Ruehlmann

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Marc B. Wolpow

  
	
   

  	
  Marc B. Wolpow

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Geoffrey S. Rehnert

  
	
   

  	
  Geoffrey S. Rehnert

  
	
   

  	
   

  
	
   

  	
  H.I.G. SUN PARTNERS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sami Mnaymneh

  
	
   

  	
  Name:

  	
   Sami Mnaymnhe

  
	
   

  	
  Its:

  	
    Secretary

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