AMENDMENT NUMBER ONE TO THE SEALY BONUS PLAN
Exhibit 10.38
AMENDMENT NUMBER ONE
TO THE
SEALY BONUS PLAN
WHEREAS, The Sealy Corporation, a Delaware Corporation (“Company”), maintains this incentive compensation plan (“Plan”) for the benefit of its eligible employees; and
WHEREAS, Section 8 of the Plan reserves to the Company the right to amend the Plan; and
WHEREAS, the Company now desires to amend the Plan to increase the potential bonus payout for certain participants,
NOW, THEREFORE, the Company does hereby amend the Plan, to be effective retroactive to December 1, 1995, as follows:
FIRST: Section 3 of the Plan is deleted in its entirety and the following is substituted therefor:
3. Participation. Participants in the Plan are selected during each fiscal year by the Board from exempt salaried employees. Participants are assigned to a bonus group at the sole discretion of the Board, with groupings generally as follows:
| Group 8: |
| Selected Senior Company Executives |
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| Group 7: |
| Senior Company Executives |
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| Group 6: |
| Corporate and Regional Vice Presidents |
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| Group 5: |
| Other Senior Management |
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| Group 4: |
| Plant Managers, Sales Managers |
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| Group 3: |
| Other Middle Management |
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| Group 2: |
| Plant Controllers, Senior Professionals and Supervisors |
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| Group 1: |
| Selected Exempt Employees |
SECOND: Section 4 of the Plan is deleted in its entirety and the following is substituted therefor:
4. Amount of Award. Bonus awards under the Plan are based on the degree to which the financial performance of the Company, its operating plants, regions and selected subsidiaries meet the goals established for each fiscal year.
Individual awards under the Plan are based on the performance of the business segment (i.e., Company, division, plant and/or region) to which such participant is assigned. The percentage of salary used in the bonus award calculation for each Group increases from zero to a stated maximum as performance exceeds the minimum goal according to the following Schedule of Bonus Awards:
| GROUP |
| MINIMUM |
| TARGET |
| MAXIMUM |
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| 8 |
| (As determined by the Board for each participant) | ||||
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| 7 |
| 0% |
| 35% |
| 70% |
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| 6 |
| 0% |
| 30% |
| 60% |
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| 5 |
| 0% |
| 25% |
| 50% |
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| 4 |
| 0% |
| 20% |
| 40% |
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| 3 |
| 0% |
| 15% |
| 30% |
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| 2 |
| 0% |
| 10% |
| 20% |
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| 1 |
| 0% |
| 5% |
| 10% |
Subject to section 5 below, bonus awards will be calculated as a percentage of a participant’s weighted average annual rate of base salary in effect for the fiscal year for which a bonus is payable.
IN WITNESS WHEREOF, the Company, by its duly authorized officers, has executed this instrument in several counterparts this 30th day of Oct., 1996.
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| SEALY CORPORATION | ||
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| By: | /s/ Ron L. Jones |
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| Its: | President / C.E.O. |
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| And: | /s/ Jeffrey C. Claypool |
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| Its: | V.P. Human Resources |
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