Management Presentation

Management PresentationA Confidential Presentation June 23, 2015

An amended and restated preliminary base PREP prospectus containing important information relating to the securities described in this presentation has been filed with the securities regulatory authorities in each of the provinces and territories of Canada. A copy of the amended and restated preliminary base PREP prospectus, and any amendment, is required to be delivered with this presentation. The amended and restated preliminary base PREP prospectus is still subject to completion. There will not be any sale or any acceptance of an offer to buy the securities until a receipt for the final base PREP prospectus has been issued. This presentation does not provide full disclosure of all material facts relating to the securities offered. Investors should read the amended and restated preliminary base PREP prospectus, the final base PREP prospectus, the supplemented PREP prospectus and any amendments thereto, for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision. Capitalized terms used but not otherwise defined herein shall have the respective meaning ascribed thereto in the amended and restated preliminary base PREP prospectus.

Disclaimers

2

Prospective investors should rely only on the information contained in the amended and restated preliminary base PREP prospectus dated June 23, 2015 (the “preliminary prospectus”). This presentation is qualified in its entirety by reference to, and must be read in conjunction with, the information contained in the preliminary prospectus. Neither the Company nor any of the Underwriters has authorized anyone to provide prospective investors with different or additional information. If anyone provides prospective investors with additional or different or inconsistent information, including information or statements in media articles about the Company, prospective investors should not rely on it. Prospective investors should not assume that the information contained in this document is accurate as of any date other than the date of the preliminary prospectus, or where information is stated to be as of a date other than the date of the preliminary prospectus, such other applicable date. No securities regulatory authority has expressed an opinion about the securities described herein and it is an offence to claim otherwise. An investment in the securities described herein is speculative and involves a number of risks that should be considered by a prospective investor. Prospective investors should carefully consider the risk factors described under “Risk Factors” in the preliminary prospectus and other information included in the preliminary prospectus before investing in the Company and purchasing the securities described herein.

The Company is not offering, or soliciting offers to acquire, the securities described herein in any jurisdiction in which such offer or solicitation is not permitted. For prospective investors outside Canada, neither the Company nor the Underwriters have done anything that would permit the offering or distribution of this document together with the preliminary prospectus in any jurisdiction where action for that purpose is required, other than in Canada. Prospective investors are required to informthemselves about and to observe any restrictions relating to the offering and the distribution of this document and of the preliminary prospectus.

In this presentation, all amounts are in Canadian dollars, unless otherwise indicated. Terms undefined herein have the meanings ascribed to them in the preliminary prospectus.

Forward-looking InformationThis presentation contains “forward-looking information” within the meaning of applicable Canadian securities laws. Forward-looking information may relate to the Company’s future outlook and anticipated events or results and may include information regarding the financial position, business strategy, growth strategy (including the objectives to open new stores, to drive annual SSSG (1) and to increase revenue and Operating EBITDA (1) over the next five to seven years), budgets, operations, financial results, taxes, dividends, plans and objectives of the Company. Particularly, information regarding future results, performance, achievements, prospects or opportunities of the Company or the Canadian or U.S. market is forward-looking information. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects” or “does not expect”, “is expected”, “an opportunity exists”, “is positioned”, “estimates”, “intends”, “assumes”, “anticipates” or “does not anticipate” or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might”, “will” or “will be taken”, “occur” or “be achieved”.

Discussions containing forward-looking information in this presentation may be found, among other places, under the headings “Stable long-term growth”, “Future same store sales growth”, “Roadmap to growth – Continued implementation of enhanced store design”, “Roadmap to growth – Add stores in new, existing and satellite markets”, “Attractive financial model results in strong cash flow conversion”, “National scale has economic benefits”, “Regional dominance adds profitability and barrier to entry”, “Select Financial Highlights and Growth Targets”, “Capitalization”, “Investment Highlights” and “Summary of the Initial Public Offering”. These forward-looking statements include, among other things, statements relating to:

the Company’s expectations regarding its revenue, expenses and operations; the Company’s future growth plans, including new store openings and store closures, entry into existing, satellite and new markets, and acquisitions; the Company’s expectations with respect to SSSG and growth of revenue and Operating EBITDA; the Company’s expectations with respect to growth resulting from its marketing and advertising efforts; the Company’s expectations with respect to growth resulting from the continued implementation of the enhanced store design; the Company’s expectations with respect to growth resulting from the continued implementation of its sales associate training programs; the Company’s intention to declare dividends and the anticipated quantum of any dividends; the Company’s expectations with respect to its relationships with its suppliers; the Company’s expectations with respect to its ability to leverage its scale to improve margins; anticipated trends and challenges in the Company’s business and the market in which it operates; the Company’s anticipated use of the net proceeds of the Offering and completion of the Acquisition; and the market price for the Common Shares.

In addition, the Company’s assessment of potential new store openings and SSSG and increases in revenue and Operating EBITDA over the next five to seven years is considered forward-looking information. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations of SCCI — Outlook” in the preliminary prospectus for additional information concerning the Company’s strategies, assumptions and outlook in relation to this assessment.

These statements and other forward-looking information are based on opinions, assumptions and estimates made by the Company in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate and reasonable in the circumstances, but there can be no assurance that such estimates and assumptions will prove to be correct. In addition, if any of the assumptions or estimates made by management prove to be incorrect, actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this presentation. Accordingly, prospective purchasers are cautioned not to place undue reliance on such statements.

Forward-looking information is necessarily based on a number of the opinions, assumptions and estimates that, while considered reasonable by the Company as of the date such statements are made, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to the following factors described in greater detail in “Risk Factors” in the preliminary prospectus: industry risk and economic sensitivity; effectiveness and efficiency of advertising expenditures; ability to maintain profitability and implement growth strategy; fluctuations in same store sales; damage to the Company’s reputation; competition; seasonality and weather; real estate; dependence on key personnel; labour relations; relationship with suppliers; intellectual property; dependence on distribution centres and timely delivery to customers; dependence on management information systems; insurance; comfort and price guarantees; debt covenants in New Credit Facility; dependence on operating subsidiaries; fluctuations in product cost, inflation and foreign currency; legal proceedings; government regulation; third-party consumer financing arrangements; absence of a prior public market for the Offered Shares; price volatility of the Offered Shares; forward-looking information; risks relating to the Acquisition; significant ownership by the Birch Hill Entities; future sales of Common Shares by the Birch Hill Entities and directors and officers of the Company; payment of dividends; pro forma financial information; public company status; financial reporting and other public company requirements; dilution; and securities analysts’ research or reports could impact the price of the Common Shares. These factors and assumptions are not intended to represent a complete list of the factors and assumptions that could affect the Company. These factors and assumptions, however, should be considered carefully.

All of the forward-looking information in this presentation is qualified by these cautionary statements. Statements containing forward-looking information contained herein are made only as of the date of the preliminary prospectus. The Company expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.

(1) See “Non-IFRS Measures and Retail Industry Metrics” in the Prospectus.

Non-IFRS Measures and Retail Industry Metrics

3

This presentation makes reference to certain non-IFRS measures. These measures are not recognized measures under International Financial Reporting Standards (“IFRS”) and do not have a standardized meaning prescribed by IFRS. They are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The Company uses non-IFRS measures, including “Adjusted Net Income”, “EBITDA”, “Free Cash Flow”, “Free Cash Flow Conversion”, “Operating EBITDA” and “Working Capital”. This presentation also makes reference to certain operating metrics that are commonly used in the retail industry, including “AUSP”, “conversion” and “Same Store Sales Growth” or “SSSG”. These non-IFRS measures and retail industry operating metrics are used to provide investors with supplemental measures of the Company’s operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. The Company also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures and these retail industry metrics in the evaluation of issuers and to compare the Company’s performance against others in the retail industry. The Company’s management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and to determine components of management compensation. See “Selected Consolidated Financial Information” in the preliminary prospectus.

Prospective investors should review this information in conjunction with SCCI’s consolidated financial statements and the Company’s pro forma financial statements, including the notes thereto, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations of SCCI”, “Use of Proceeds”, “Capitalization” and “Description of Material Indebtedness”, included in the preliminary prospectus.

Sleep Country’s Executive Team

4

David Friesema Stewart Schaefer Robert Masson

Chief Executive OfficerPresident, Dormez-vous?

and Chief Business Development Officer

Chief Financial Officer and Corporate

Secretary

Stephen Gunn Christine Magee

Founder and Executive Co-Chair

Founder and Executive Co-Chair

Investment Highlights

5

The Leading Specialty Mattress Retailer in Canada

Best-in-Class Retailer Driven by Superior Strategy and Execution

Clear Growth Strategy

Attractive Financial Model with Strong Cash Flow Conversion

Compelling Industry Fundamentals

Experienced and Committed Management Team

Compelling Industry Fundamentals

Stable, long-term growth

7

(1) Source: ISPA.

Necessity purchase not a fashion item; even during an economic downturn sales are typically deferred and not lost

Recurring demand driven by 10-12 year replacement cycle

Consumer preferences evolving toward premium quality, larger mattresses given growing health awareness and preference for high-quality sleep

Price increases due to inflation are typically passed through to consumers

U.S. Mattress and Foundation Wholesale Sales (US$ billions) (1)

Recession

$0.8 $0.9 $0.9 $1.0 $1.1 $1.2 $1.3 $1.4 $1.4 $1.6 $1.7 $1.8 $1.9 $2.1 $2.3 $2.3 $2.3 $2.4 $2.6 $2.8 $3.0 $3.2 $3.3 $3.6$4.0

$4.4 $4.6 $4.6 $4.8$5.2

$5.8$6.5

$6.8 $6.9$6.2

$5.7 $5.9$6.3

$6.8 $7.0$7.5

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Similar trends experienced in the Canadian market

Specialty Mattress Retailers

58%

Furniture Retailers

26%

Others9%

Department Stores

7%

2014

Shift in consumer shopping preferences

8

(1) Source: Furniture Today.

North American retail mattress industry has undergone a fundamental shift in consumer preference toward specialty mattress retailers like Sleep Country

U.S. Specialty Mattress Retailers Taking Share (1)

Specialty Mattress Retailers

32%

Furniture Retailers

42%

Others13%

Department Stores13%

2000

2000 2013


Largest mattress retailer in Canada

10

215 stores and 16 distribution centres across 8 provinces (1)

Has opened 78 stores since the beginning of 2007

Only specialty mattress retailer with a national and regionally diverse footprint

(1) Store count as of March 31, 2015.(2) LTM as of March 31, 2015.

BC

AB

SKMB

ON QC

NL

NBPE

NS

36

26

67 86 747

Sleep Country's National Footprint (# of stores)

LTM (2) (C$ millions)

Sales $406

Operating EBITDA $56

Leading market share

11

(1) Source: Market Survey, September 2014. Purchase data based on six months ended September 2014.Note: Leon’s Furniture Ltd. owns both Leon’s and The Brick banners.

The Brick12%

IKEA 8%

Leon's 4%

Hudson's Bay 4%

Others 33%

Sleep Country Canada

24%

Sears Canada15%

BMTC 13%

IKEA 7%

The Brick5%

Matelas Bonheur

5%

Leon's2%

Hudson's Bay 2%

Others 38%

Sears Canada11%

Dormez-vous?17%

Canadian Mattress Industry Share of Consumer Transactions (1)

Leading specialty mattress retailer with an estimated national market share of 23%

Best-in-Class Retailer Driven by Superior Strategy and Execution

Highly focused strategy with exceptional execution

13

“Best-in-Class” Retailer

Strong Brand Recognition

1

Unrivalled In-Store Customer Experience

2

Highly Trained and Dedicated Workforce with a Strong

Culture of Customer Service

4Superior Home DeliveryExperience and Ongoing Customer Relationships

3

Leading brand recognition and traffic

14

(1) Source: Market Survey, September 2014. (2) Participants polled were asked: “Thinking about stores that sell mattresses, that you would shop at if you were buying a mattress, please tell me the name of the store that

comes to mind first.”(3) Traffic data based on six months ended September 2014.

Note: Leon’s Furniture Ltd. owns both Leon’s and The Brick banners.

"Top-of-Mind" Unaided Brand Awareness (1) (2)

27%

18%

12%

6%5%

Dormez-vous?

BMTC SearsCanada

MatelasBonheur

The Brick

36%

15%

13%

8%

5%

3%

SleepCountryCanada

SearsCanada

The Brick IKEA Leon's Hudson'sBay

Advertising strategy driving “top-of-mind” unaided brand awareness and leading share of customer visits

41%

34%

30%

16%

14% 13%

SleepCountryCanada

SearsCanada

TheBrick

IKEA Leon's Hudson'sBay

Customer Traffic (% of Shoppers Who Visited Store) (1) (3)

30%

27% 26%

16%

9%

Dormez-vous?

SearsCanada

BMTC The Brick MatelasBonheur

Unrivalled in-store customer experience

15

Customers Need Assistance

Sleep Country Offering

Effective sales force

Differentiated, multi-vendor product mix

Customer-oriented policies

Infrequent purchase

Big-ticket item

Highly personalized tastes, preferences, needs and budgets

Constantly evolving, difficult to compare product landscape

Leading shopper to buyer conversion

16

Shopper to Buyer Conversion (% of Shoppers that Purchase) (1) and Canadian Mattress Industry Share of Consumer Transactions (2)

(1) Source: Market Survey, September 2014. Conversion data based on six months ended September 2014.(2) Source: Market Survey, September 2014. Purchase data based on six months ended September 2014.

Note: Leon’s Furniture Ltd. owns both Leon’s and The Brick banners.

31%

31%

50%

40%

44%

59%

Hudson'sBay

Leon's

IKEA

The Brick

Sears Canada

Sleep Country Canada

4%

4%

8%

12%

15%

24%

Shopper to Buyer Conversion Share of ConsumerTransactions

40%

33%

50%

31%

70%

41%

50%

57%

Hudson'sBay

Leon's

MatelasBonheur

The Brick

IKEA

Sears Canada

BMTC

Dormez-vous?

2%

2%

5%

5%

7%

11%

13%

17%

Share of ConsumerTransactions

Shopper to Buyer Conversion

Superior home delivery experience and ongoing customer relationships

17

Home delivery is critical• Customers are sensitive about home

delivery• Final impression left with customers

Customers Sensitive to Service

Better people, better trained• Uniformed delivery personnel• Shoe covers to protect floors

Efficient delivery logistics• Enterprise-wide IT system supports

delivery logistics• Three-hour delivery time window

Recycle/donation of picked-up mattress sets

Sleep Country Offers Superior Execution

Creates high customer satisfaction and word-of-mouth marketing benefits

OntarioRank Retailer 2014

1 81.2

2 Kitchen Stuff Plus 75.9

3 Williams-Sonoma 71.0

4 Stokes 66.9

5 IKEA 59.2

6 Crate&Barrel 58.9

7 Pier 1 Imports 57.0

8 Sears Home Décor 56.2

9 The Brick 55.6

10 Home Sense 50.7

Strong culture of customer service

18

(1) Source: WOW! Retailer Ranking by Sector by Leger Metrics Inc.(2) Mercer Retail Industry Compensation and Benefits Survey, August 2014.

Note: Ontario survey based on 113 Ontario retailers. Over 500 recent customers 15 years of age or older were asked to respond to 16 dimensions. Québec survey based on 148 Québec retailers. Over 400 recent customers 15 years of age or older were asked to respond to 10 to 16 dimensions.

QuébecRank Retailer 2014

1 Ameublement Tanguay 80.7

2 67.7

3 Stokes 67.6

4 Williams-Sonoma 67.5

5 Brault & Martineau 66.4

6 Germain Larivière 65.2

7 Linen Chest 64.7

8 J.C. Perrault 63.8

9 IKEA 60.6

10 Pier 1 Imports 58.5

Leading Home Decor Customer Satisfaction Score (1)

Sleep Country’s Award Wining Corporate Culture

Low turnover rate (2)

• Sleep Country at 16% • Retail industry average of 44%


In 2012, implemented and invested in a number of strategic programs aimed at driving future growth

20

Revamped the Advertising Strategy

Increased internal and external marketing resources to bolster traditional and online marketing strategies

Expanded the creative messaging to create better breakthrough with consumers

Enhanced the Sales and Service Training

Enhanced already comprehensive onboarding and initial training programs Supplemented on-going training workshops and advanced training with a focus on

enriching the knowledge base and skill sets of its sales associate team

Redesigned and Expanded Accessories

Line

Focused on creating a broader selection of sleep accessories Additional training programs in sales and operations More than doubled complementary sleep products and accessories revenue

between 2006 and 2014

Broadened Real Estate Footprint Across

Canada

Placed greater focus on locating appropriate in-fill, satellite and new market stores • Added 30 new stores since the beginning of 2012

Upgraded Logistics Systems and Software

Upgraded point-of-sale software, leading to improved communication between stores and distribution centres

Additional upgrades to the logistics and routing software allowed Sleep Country to schedule and complete home deliveries in a more efficient manner

Differentiated strategy has delivered strong results and momentum

21

Sleep Country Quarterly Same Store Sales Growth (1)

(1) Source: Company report. See ‘‘Non-IFRS Measures and Retail Industry Metrics’’ and ‘‘Selected Consolidated Financial Information’’ in the Prospectus.

3.8%

(10.2%)

(2.5%)

(7.4%)

(3.9%)

(0.1%)

0.8%

7.3%

1.3%

9.1% 11.1%

10.2% 10.5%

(15.0%)

(10.0%)

(5.0%)

0.0%

5.0%

10.0%

15.0%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q12012 2013 2014 2015

Began to realize benefits of strategic operational initiatives

22

Future same store sales growth

Increase Traffic Increased marketing investment Expand messaging

Increase Conversionof Shoppers to Buyers

Continued focus on hiring the best people Additional training initiatives

Higher AUSP Continued shift to higher quality mattresses Larger sizes are increasing in popularity

Expand Accessory Sales

Expand and improve product lines Additional marketing messaging Enhanced training

Enhanced Store Design

Contemporary design creates bright and welcoming atmosphere Greater emphasis on accessory displays

$31

$73

2006 2014

Roadmap to growth – Increase accessories sales

23

Bedframes

Pillows

Mattress pads

Key Accessories Sleep Country Accessories Revenue (1) (C$ millions)

Sheets

Duvets

Headboards and Footboards

Opportunity to capture market share in an estimated $830 million highly fragmented yet addressable market in Canada

(1) Source: Company report.

11.5% CAGR

Roadmap to growth – Continued implementation of enhanced store design

24

Results for the four stores renovated in 2014 show an 18% increase in revenues

Roadmap to growth – Add stores in existing, satellite and new markets

25

(1) Source: Based on Statistic Canada’s total 2014 population in each province. Note: Store Count as of March 31, 2015.

(2) Assuming a 2% population growth per year for seven years.(3) Source: Company filings.

Significant white space is available given its low store density

84

60

All Markets High Density Markets

Population Per Store (thousand) (1) Population Per Store (thousand) (3)

162

140

Today 5-7 Years

Leading U.S. Specialty Mattress Retailer

(2)

Modest net new store cost of approximately $325,000 comprising of capex and working capital investment

Typically, new in-fill and satellite stores are cash flow positive within 6 and 12 months, respectively

In-Fill Store Opportunity – Demonstrated Success

26

Sleep Country’s most tenured market

Added six new stores from 2012 to 2014, growing the regional store footprint from 19 to 25 stores

Leveraged highly scalable centralized support infrastructure• Regional advertising• Management• Fixed distribution centre costs

New In-Fill Stores Continue to Drive Sales Growth in Longstanding Richmond Market

(1) See “Non-IFRS Measures and Retail Industry Metrics” in the Prospectus. (2) Inner blue circle indicates 3 km radius; outer blue circle indicates 10km radius

B.C. Case Study

19 Existing Stores6 In-Fill StoresCities

Results

Total sales in region increased by 29%• Existing stores achieved same store sales

growth of 7% (1)

• New stores contributed 22%

Scale: 20 km

Expanded View (2)

Legend

Attractive Financial Model with Strong Cash Flow Conversion

Attractive financial model results in strong cash flow conversion

28

Attractive Financial Model

National Scale Creates Economic Advantages

1

Regional Scale Optimizes Economics on a Per-Store Basis

2

Working Capital Funds Growth

3

Low Capital Expenditure Requirements

4

National scale has economic benefits

29

Vendor relationships

• Buying Power

Advertising efficiency

• National buys

Leveraging centralized corporate overheads

Leading Suppliers to Sleep CountrySleep Country’s Economic Advantages

Regional store density adds profitability and barrier to entry

30

RegionalStore

Density

RegionalStore

Density

High barrier to entry for competition

Leverage regional fixed costs

Build leadership position quickly

Add in-fill stores over time

Working capital funds growth

31

Sleep Country Working Capital Cycle

Day 33-48: Pay Supplier

Day 0: Customer Purchase Customer Payment

Day 3: Mattress Delivered

to Warehouse

Day 0 Day 33 Day 48Day 1

Day 1: Mattress Ordered

Day 3

30-45 Day Payment Terms from Supplier

Day 4

Day 4: Mattress Delivered

to Customer

“Just-in-time” inventory relationship with mattress suppliers results in cash flow generated from working capital to fund growth

Low capital expenditure model

32

Maintenance capital expenditures have averaged 1.0% of revenue from 2008 to 2014

(1) Source: Company report.

Sleep Country Maintenance and Growth Capital Expenditures (% of sales) (1)

1.4%

0.8% 0.8% 1.0%

1.3% 1.2%

0.5%

1.1%

0.7% 0.5%

0.9%

1.5% 1.9%

1.3%

2.6%

1.5% 1.2%

1.9%

2.9% 3.1%

1.8%

2008 2009 2010 2011 2012 2013 2014

Maintenance Growth

(C$ million unless otherwise stated) 2012 2013 2014 LTM (31-March-15) 5-7 Year Targets

Revenue $332.6 $353.9 $396.1 $406.4 $575 to $640

Same Store Sales Growth (4.2%) 1.0% 8.3% 10.3% 3-6%

Net New Stores 10 13 4 4 50-70 Total

Gross Profit $80.9 $88.1 $103.4 $108.0

Gross Margin 24.3% 24.9% 26.1% 26.6%

SG&A $42.6 $50.2 $54.9 $55.0

% of sales 12.8% 14.2% 13.9% 13.5%

Operating EBITDA $38.4 $39.4 $50.6 $55.8 $80 to $90

Operating EBITDA Margin 11.5% 11.1% 12.8% 13.7%

Select Financial Highlights and Growth Targets (1)

33


Capitalization

34

(1) At Closing, the Company is expected to have outstanding long term debt of approximately $157 million, consisting of $155 million drawn under the New Credit Facility and finance leases of approximately $2 million.

(2) Revolving credit facility in the maximum amount of $175 million which will mature five years from the Closing Date.

As at March 31, 2015(C$ millions) (unaudited) Pro Forma(1)

Revolving Credit Facility $30.0 $155.1

Senior Term Loan $125.1 --

Credit Facility $155.1 $155.1

Finance Leases $2.1 $2.1

Total Debt $157.2 $157.2

Debt / LTM Operating EBITDA 2.8x 2.8x

(2)

Capital structure provides financial flexibility to grow the business

Experienced and Committed Management Team

Proven management team committed to growing the business and shareholder value

36

Member Years at Sleep Country

Relevant Experience Biography

Dave Friesema Chief Executive Officer

20+ 20+ Held numerous senior positions at Sleep Country including Head of Sales, General Manager and Chief Operating Officer

Chairman of the Better Sleep Council Canada Helped establish and manage mattress retail organizations in the United States

Robert Masson Chief Financial Officer and

Corporate Secretary

2 20+ Chief Financial Officer of Second Cup from 2009 to 2013 Prior to joining Sleep Country, Robert had extensive management experience with several

other public and private companies including, IBM Canada, Manchuwok, Ernst & Young, Deloitte & Touche and Sappi

Stewart Schaefer President, Dormez-vous? Chief Business Development

Officer

10 20+ Founded Dormez-vous? in 1994; grew the business to five stores before being acquired by Sleep Country in 2006

In 1992, co-founded Heritage Classic Beds, a distributor of metal beds Commodity Broker in Chicago from 1986 to 1992, later returning to Montreal to work at

Dean Witter Reynolds and Refco Futures

Dave Howcroft Senior Vice President, Sales

20+ 20+ Created programs to consistently build, develop and motivate a first-class sales team Instrumental in developing and implementing various sales workshops, training programs

and sales processes

Sieg Will Senior Vice President, Operations

14 20+ Instrumental in development and implementation of standard operating policies and procedures across organization

Held senior positions with Canadian Tire and PepsiCo in the sales, operations and account management areas

Eric Solomon Senior Vice President,

Merchandising and Marketing

20+ 20+ Instrumental in growing the business by increasing "top-of-mind" brand awareness Provides oversight to the marketing department

Stephen Gunn Founder & Executive Co-Chair

20+ 20+ Co-founded Sleep Country in 1994 Co-founded and was President of Kenrick Capital, a private equity firm Management Consultant at McKinsey and Company from 1981 to 1987 Serves on the Board of Directors of Dollarama, Golfsmith International, Cara and

Mastermind Toys

Christine Magee Founder & Executive Co-Chair

20+ 20+ Co-founded Sleep Country in 1994 Senior Manager of Corporate and Commercial Lending with National Bank from 1985 to

1994 Serves on the Board of Directors of Sirius XM Canada, Trillium Health Partners and the

Advisory Board of the Ivey School of Business

Investment Highlights

37

Compelling Industry

Fundamentals

North American mattress and foundation industry is characterized by stable, long-term growth and a high degree of resiliency to economic swings

Industry demand driven by essential nature of product and replacement cycle of 10-12 years Shift in consumer preference towards larger size mattresses and premium quality products Consumers have shifted preference towards specialty mattress retailers due to big-ticket nature of mattress purchase and lack of consumer

product knowledge Low vulnerability to online competition and showrooming due to highly tactile purchase decision,


Only specialty mattress retailer in Canada with a national and regionally diverse footprint National footprint of 215 stores and 16 distribution centres across 8 provinces Leading specialty mattress retailer with an estimated national market share of 23%

Best-in-Class Retailer Driven by Superior Strategy

and Execution

Largest share of customer visits across Canada driven by “top-of-mind” unaided brand awareness and 20-year advertising investment Unrivalled in-store customer experience drives high conversion of sales, repeat business and superior sales per associate metrics Superior home delivery experience and ongoing customer relationships drives high customer satisfaction, repeat sales and word-of-mouth

advertising Highly trained and dedicated workforce with a strong culture of customer service Convenient and highly visible locations


Opportunity to grow Revenue and Operating EBITDA to $575-$640 million and $80-$90 million, respectively, in 5-7 years Strong same store sales growth(1) potential driven by increased mattress and accessories sales growth and continued implementation of

enhanced store design Opportunity to open 50-70 net new stores in the next 5-7 years in existing, satellite and new markets Operating leverage on sales growth through highly scalable centralized support infrastructure Selectively consider strategic acquisitions that are accretive and enhance market opportunities

Attractive Financial Model with Strong

Cash Flow Conversion

National scale creates economic advantages Regional scale optimizes economics on a per-store basis Negative working capital operating model facilitated by "just in time" inventory relationship with suppliers, funds growth Low capital expenditure requirements due to asset-light business model (~1.0% maintenance capex requirements) Compelling new store economics with in-fill locations typically becoming cash flow positive within 6 months of opening

Experienced and Committed

Management Team

Highly experienced management team with proven track record On average 15+ years of experience with Sleep Country and 20+ years of relevant industry experience Proven track record of success as a public company Co-founders remain committed to the business and its long-term success


Summary of the Initial Public Offering

Amount $200 million plus 15% over-allotment option

Offering Price $14.00 – $16.00 per Common Share

Initial Dividend Yield ~2.8% – ~3.2%

DRIP 3% discount to the 5-day VWAP

Use of Proceeds

Partially satisfy the purchase price for the acquisition of Sleep Country Canada Inc., Sleep Country US Holdco Canada Inc. and SC Management Holding Inc. from Existing Shareholders

Redeem Class A Common Shares held by the Birch Hill Entities Subscribe for additional common shares of Sleep Country Canada Inc.

Retained Interest Birch Hill Entities & Co-Investors: ~54% to ~59% (1)

Management and Directors: ~7%

Standstill / Lock-up 180 days for the Company, the Existing Shareholders and each director of the Company

Eligibility RRSPs, RRIFs, TFSAs, RESPs, RDSPs and DPSPs

Listing Closing of IPO conditional on TSX listing approval

Pricing Expected the week of July 6th, 2015

Closing Expected the week of July 13th, 2015

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(1) Including Common Shares held by the Co-Investors

Comparables

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In accordance with Section 13.7(4) of National Instrument 41-101 – General Prospectus Requirements, all the information relating to Sleep Country’s comparables and any disclosure relating to the comparables, which is contained in the presentation to be provided to potential investors, has been removed from this template version for purposes of its filing on the System for Electronic Document Analysis and Retrieval (SEDAR).

Description of Non-IFRS Measures and Retail Industry Metrics

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The financial statements included in the preliminary prospectus have been prepared in accordance with IFRS as issued by the International Accounting Standards Board and accounting policies adopted in accordance with IFRS. However, this presentation makes reference to certain non-IFRS measures including:

“Adjusted Net Income” is defined as net income (loss) from continuing operations adjusted for: (i) interest expense on the Series A and Series B promissory notes of SCCI; (ii) interest expense and fair value adjustment on Class A convertible shares and Class B common shares of SCCI; (iii) reduction in management bonuses; (iv) reduction in management compensation; (v) certain non-recurring items (shareholder capital reorganization, professional fees and customer deposit breakages and other provision); and (vi) share based compensation.

“AUSP” is defined as the average unit selling price of a mattress or foundation.

“EBITDA” is defined as net earnings (loss) from continuing operations before: (i) net interest expense and other financing charges; (ii) income taxes; (iii) depreciation of property, plant and equipment; and (iv) amortization of other assets.

“Conversion” is defined as the number of customers who entered a store and made a purchase divided by the total number of customers who entered the store (expressed as a percentage).

“Free Cash Flow” is defined as EBITDA less: (i) maintenance capital expenditures; and (ii) changes in Working Capital.

“Free Cash Flow Conversion” is defined as Free Cash Flow divided by EBITDA.

“Operating EBITDA” is defined as EBITDA adjusted for: (i) reduction in management bonuses; (ii) reduction in management compensation; (iii) certain non-recurring items (shareholder reorganization, professional fees and customer deposit breakages and other provision); and (iv) share based compensation.

“Same Store Sales Growth” or “SSSG” is a retail industry metric used to compare sales derived from the established stores of certain period over the same period in prior year. SSSG helps to explain what portion of sales growth can be attributed to growth in established stores and what portion can be attributed to the opening of the new stores. Sleep Country calculates SSSG as the percentage increase or decrease in sales of stores opened for at least 12 complete months relative to the same period in the prior year.

“Working Capital” is defined as the sum of trade and other receivables, inventories, prepaid expenses and deposits less trade and other payables and customer deposits.

These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. They are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS.

See “Selected Consolidated Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of SCCI” in the preliminary prospectus.

Documents

Management Presentation