2016 Say on Pay Supplementary Material: Compensa8on Program Designed to Deliver Long-‐Term Value
1
April 2016
Board Recommends Shareholders Vote "FOR" All Proposals Tempur Sealy's Board of Directors unanimously recommends that all shareholders vote "FOR" the following proposals at the Company's 2016 Annual MeeGng
Proposal One: "FOR" the elecGon of Evelyn S. Dilsaver, John A. Heil, Jon L. Luther, Usman Nabi, Richard W. Neu, ScoT L. Thompson and Robert B. Trussell, Jr. as Nominees to the Company's Board of Directors
Proposal Two: "FOR" the raGficaGon of the appointment of Ernst & Young LLP to serve as Tempur Sealy's Independent Auditors
Proposal Three: "FOR" the advisory vote to approve the compensaGon of named execuGve officers
The following slides are intended to provide shareholders with addiGonal background informaGon pertaining to Proposal Three: Say on Pay and to further elaborate how the Board specifically designed our compensaGon program to incent the creaGon of long-‐term shareholder value
Overview of 2015 Proxy Contest & Referendum
In 2015, Tempur Sealy's Largest Shareholder Asked forShareholder Support to Reinvigorate Five Cri/cal Founda/ons
In early 2015, H Partners Management ("H Partners"), Tempur Sealy's largest shareholder, commenced a proxy solicitaGon intended to reposiGon the Company for long-‐term success
CiGng Tempur Sealy's stock relaGve underperformance, poor financial results, and lack of effecGve board oversight, H Partners proposed a referendum ("the Referendum") outlining changes to five enduring foundaGons which, if implemented, would likely create significant shareholder value
Two aspects of the Referendum - (i) the recruitment of a capable CEO and (ii) alignment with stretch goals - need to be considered when vo>ng on our now restructured compensa>on program
A Capable CEO Replace underperforming CEO with a proven leader with an operaGonally-‐intensive background
Appropriate Org.
Structure
Immediately review if execuGon mistakes are occurring due to gaps in operaGons team, and fill vacant roles
A Focused Strategy
Narrow strategic focus to emphasize profitability vs. unprofitable sales growth; prioriGze high-‐value projects
Alignment with
Stretch Goals
Re-‐align employees to deliver substanGally higher margins; reduce number of compensaGon metrics
Clear CommunicaGon
Communicate clearly and repeatedly with all employees, retail partners and shareholders; set credible earnings goals
Source: H Partners Investor Presentation, April 7, 2015.
Tempur Sealy International Inc. issued this content on 25 April 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 25 April 2016 16:44:24 UTC
Original Document: http://investor.tempurpedic.com/common/download/download.cfm?companyid=TPX&fileid=887573&filekey=2D0A4853-ACEA-49CE-A76B-B6F05B0003CF&filename=TPX_2016_Proxy_Supplementary_Slides_4.24.16_-1.pdf