Bed, Bath and Beyond 2014 Annual Report Download - page 57

The resulting 19 company peer group consisted of the following companies at the time of the analysis:
Advance Auto Parts, Inc. L Brands, Inc.
AutoZone, Inc. Macy’s, Inc.
Dick’s Sporting Goods, Inc. Nordstrom, Inc.
Dillard’s, Inc. O’Reilly Automotive, Inc.
Dollar General Corporation PetSmart, Inc.
Family Dollar Stores, Inc. Ross Stores, Inc.
Foot Locker, Inc. Staples, Inc.
GameStop Corp. Starbucks Corporation
The Gap, Inc. The TJX Companies, Inc.
Kohl’s Corporation
The methodology used by Gallagher also included reviewing available data based on the Company’s industry, revenue size and
financial performance. The peer group analyses prepared by Gallagher used public company proxy statements, third party
industry compensation surveys and other publicly available information.
At the request of the Compensation Committee, Gallagher conducted a compensation review for all executive officers,
including the named executive officers, and for certain other key executives. Gallagher benchmarked the named executive
officers’ total compensation and separately their cash compensation against data from the 19 company peer group. Gallagher
also assisted the Compensation Committee in determining the provisions, including the targets, for the one-year and three-
year performance tests. With respect to the grants of the performance stock units, the Compensation Committee, with
assistance from Gallagher, adopted a wider peer group of 50 retail companies against which performance tests based on EBIT
margin for its one-year test were, and ROIC for its three-year test will be measured. This larger peer group includes the 19
company benchmarking peer group described above and was created to establish a larger, more stable statistical base over the
duration of the performance periods.
The compensation approved by the Compensation Committee for each of Messrs. Eisenberg, Feinstein and Temares for fiscal
2014 was determined by the Compensation Committee taking into account recommendations of and certain data received
from Gallagher and, in the case of Mr. Temares, the recommendations of the Co-Chairmen (also co-founders). The
compensation approved by the Compensation Committee for the named executive officers for fiscal 2014, other than the Co-
Chairmen and Mr. Temares, was determined by the Compensation Committee, taking into account the recommendations of
the Co-Chairmen, Chief Executive Officer and Gallagher and data the Compensation Committee requested from Gallagher. No
executive was present during voting or deliberations with respect to matters relating to such executive’s compensation.
Based on the recommendations and data from Gallagher, and in light of the Company’s financial results for fiscal 2013, the
growth in the size and scope of the Company, its relative performance in its industry and other factors, the Compensation
Committee determined that the named executive officers of the Company should receive the total compensation packages for
fiscal 2014, further described below.
Elements of Compensation
The Company seeks to provide total compensation packages to its associates, including its named executive officers, which
implement its compensation philosophy. As noted above, the Company places greater emphasis in the compensation packages
for named executive officers on equity incentive compensation rather than cash compensation in order to align compensation
more closely with performance results and the creation of shareholder value. In practice, the Company does not award annual
cash bonuses, as it believes such bonuses lead to a more short-term focus and decision making that could negatively impact
the long-term success of the Company.
The components of the Company’s compensation programs for its executive officers and certain other key executives are base
salary, equity compensation (consisting of awards of performance stock units and stock options), retirement and other benefits
(consisting of health plans, a limited 401(k) plan match and a nonqualified deferred compensation plan) and perquisites.
Consistent with prior practice and the Company’s culture, the Company does not provide perquisites such as club
memberships, company planes or retreats. For those perquisites provided, see the footnotes to the ‘‘Summary Compensation
Table’’ below.
Base Salary
The Company pays base salaries to provide its named executive officers with current, regular compensation that is appropriate
for their position, experience and responsibilities. Changes in base salary, if any, are generally effective in May of each fiscal
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