Bed, Bath and Beyond 2008 Annual Report Download - page 53

BED BATH & BEYOND PROXY STATEMENT
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Restricted Stock Awards. The 2004 Plan authorizes the Committee to grant restricted stock awards in the form of restricted stock
or restricted stock units. Recipients of restricted stock awards enter into an agreement with the Company subjecting the restricted
stock awards to transfer and other restrictions and providing the criteria or dates on which such restrictions lapse. Restricted stock
awards may vest over time, based on performance criteria or other factors (including, without limitation, performance goals that
are intended to comply with the performance-based compensation exception under Section 162(m) of the Code), as determined
by the Committee at grant. Unless the Committee determines otherwise at grant, the minimum restriction period for a restricted
stock award will be three years (permitting pro-rata vesting over such three year period), subject to acceleration provisions (if any)
as determined by the Committee. A holder of a restricted stock award does not have any of the rights of a stockholder until such
holder becomes a stockholder of record (with the exception of certain dividend rights). A shareholder of record generally has all
of the attendant rights of a stockholder including the right to receive dividends, if any, subject to vesting conditions as described
below, the right to vote shares and, subject to and conditioned upon the full vesting of shares, the right to tender such shares.
Awards agreements generally provide that the right to receive dividends is subject to the vesting requirements of the restricted
stock award.
Performance Awards. The 2004 Plan authorizes the Committee to grant performance awards entitling participants to receive a
fixed number of shares of common stock or cash, as determined by the Committee, upon the attainment of performance goals
with respect to a designated performance period. Unless the Committee determines otherwise at grant, the minimum perform-
ance period shall be one year.
Other Awards. The 2004 Plan authorizes the Committee to grant awards of common stock and other awards that are valued in
whole or in part by reference to, or are payable in or otherwise based on, common stock, including but not limited to: shares of
common stock awarded purely as a bonus in lieu of cash and not subject to any restrictions or conditions; shares of common stock
in payment of the amounts due under an incentive or performance plan sponsored or maintained by the Company or an affiliate;
stock equivalent units; restricted stock units; and awards valued by reference to book value of shares of common stock.
As noted above, performance-based awards granted under the 2004 Plan that are intended to satisfy the performance-based com-
pensation exception under Section 162(m) of the Code will vest based on attainment of specified performance goals established
by the Committee. These performance goals will be based on the attainment of a certain target level of, or a specified increase in
(or decrease where noted) one or more of the following criteria selected by the Committee:
•enterprise value or value creation targets;
•after-tax or pre-tax profits of the Company, including, without limitation, that attributable to continuing and/or
other operations;
•operational cash flow or economic value added;
•gross or operating margins;
•reduction of, or other specified objectives with regard to limiting the level of increase in all or a portion of, the
Company’s bank debt or other long-term or short-term public or private debt or other similar financial obligations of
the Company, which may be calculated net of cash balances and/or other offsets and adjustments as may be established
by the Committee;
•earnings per share or earnings per share from continuing operations;
•net sales, revenues, net income or earnings before income tax or other exclusions;
•return on capital employed or return on invested capital;
•after-tax or pre-tax return on stockholder equity; or
•fair market value of the shares of the common stock of the Company.
The criteria to establish performance goals also include the growth in the value of an investment in the common stock of the
Company assuming the reinvestment of dividends, or a transaction that results in the sale of stock or assets of the Company.
The Committee may also exclude the impact of an event or occurrence which the Committee determines should be appropriately
excluded, including: restructurings, discontinued operations, extraordinaryitems and other unusual or non-recurring charges;
an event either not directly related to the operations of the Company or not within the reasonable control of the Company’s
management; or a change in accounting standards required by generally accepted accounting principles.
In addition, such performance goals may be based upon the attainment of specified levels of Company performance under one
or moreof the measures described above relative to the performance of other corporations.