Bed, Bath and Beyond 2007 Annual Report Download - page 48

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BED BATH& BEYOND PROXY STATEMENT
46
The Compensation Committee requested advice from JFR regarding the methodology for determining compensation for the
named executive officers and other key officers. Based upon advice from JFR, the Compensation Committee deemed it advisable
to modify its approach to granting stock option awards by determining the compensation allocated to these awards in dollars as
compared to its approach in prior years of determining these awards based on the number of shares covered by the options.
Accordingly, the Compensation Committee made aggregate and individual compensation determinations, including each element
of compensation, in dollars. The Compensation Committee also requested advice from JFR regarding the methodology for com-
puting the number of option share grants based on dollar-denominated awards of stock option grants as described under “Senior
Executive Compensation.”
The Compensation Committee solicits input from the Co-Chairmen when considering decisions concerning the compensation of
the Chief Executive Officer, and solicits input from the Co-Chairmen and the Chief Executive Officer when considering decisions
concerning the compensation of the other named executive officers. In connection with its determinations in the spring of 2008,
the Committee consulted with the Co-Chairmen, who are the Co-Founders of the Company and who have been continuously
involved in the affairs of the Company since its organization in 1971, with respect to the recommendations of JFR regarding the
compensation package of the Chief Executive Officer. The Committee also received and reviewed the recommendations of
the Co-Chairmen and Chief Executive Officer regarding the proposed salary and equity compensation awards for the other
named executive officers and certain other officers for the fiscal year ending February 28, 2009. In addition, JFR met with the
Co-Chairmen and the Chief Executive Officer individually to discuss compensation recommendations.
The compensation approved by the Compensation Committee for each of Messrs. Eisenberg, Feinstein and Temares for fiscal 2008
was in the amounts and comprised of the elements recommended by JFR. The compensation approved by the Compensation
Committee for the other named executive officers for fiscal 2008 was determined by the Compensation Committee, taking into
account the recommendations of the Co-Chairmen and Chief Executive Officer and data the Compensation Committee requested
from JFR relating to Peer Group 1 salary increases for executives.
Elements of Compensation
The Company seeks to provide total compensation packages to our employees, including our named executive officers, that
implement our compensation philosophy. The components of our compensation programs are base salary, equity compensation
(consisting of stock options and restricted stock awards), retirement and other benefits (consisting of health plans, a limited 401(k)
plan match and a deferred compensation plan) and perquisites. The Company believes that its executive cash compensation is
low compared to the other companies in our peer group. In fact, according to the analysis prepared by JFR, the aggregate total
cash compensation for the last three years of Messrs. Eisenberg, Feinstein and Temares was in the 16th percentile of Peer Group 1
compensation for the top three executives. The Company places greater emphasis in the compensation packages for named
executive officers on equity incentive compensation in order to align compensation more closely with the creation of shareholder
value. The Company does not have a cash bonus program for executive officers.
Base Salary
The Company pays base salaries to provide our named executive officers with current, regular compensation that is appropriate
for their position, experience and responsibilities. As noted above, the Company believes that cash compensation levels for our
named executive officers are lower than our peers as the Company places great emphasis on equity compensation.
Equity Compensation
In connection with the Hewitt Study, the Compensation Committee examined possible changes to the Company’s prior sole
reliance on stock options for equity incentive awards, including, among other things, the possibility of replacing stock options, in
whole or in part, with awards of restricted stock. In conducting its evaluation, the Compensation Committee considered changes
to the accounting rules pertaining to the compensation cost of stock-based payments to employees and the desirability of achiev-
ing various goals, including promoting long-term employee stock ownership, enhancing employee retention, minimizing dilution,
providing employees with rewards for the Company’s success and linking employee pay to shareholder returns.