Bed, Bath and Beyond 2015 Annual Report Download - page 37

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PROPOSAL 3—APPROVAL, BY NON-BINDING VOTE, OF 2015 EXECUTIVE COMPENSATION
Stock Options
Stock option awards are made in dollars (with the number of shares covered by the options determined by dividing the dollar
amount of the grant by the Stock Option Fair Value, as defined below). The Compensation Committee believes that making
stock option awards in dollar amounts rather than share amounts is advisable because making stock option awards in dollar
amounts allows the Compensation Committee to align stock option awards with the value of the option grants. Awarding stock
options in a fixed dollar amount also enables the Compensation Committee to more readily evaluate appropriate aggregate
compensation amounts and percentage increases or decreases for executives, in comparison to making stock option awards
in share amounts (the value of which varies depending on the trading price of the Company’s stock and other factors). In
making the awards, the Compensation Committee considered the fair value of these options on the date of grant determined in
accordance with Accounting Standards Codification Topic No. 718, “Compensation—Stock Compensation” (the Stock Option
Fair Value).
Consistent with the Company’s historic practice, the stock options vest over time, subject, in general, to the Named Executive
Officers remaining in the Company’s service on specified vesting dates.
Time Vested Restricted Stock
All executives (other than Named Executive Officers and other key executives whose compensation is determined by the
Compensation Committee) and associates awarded incentive compensation receive grants consisting solely of restricted
stock. Vesting of restricted stock awarded to these associates is based solely on time with no performance-based test.
All 2015 awards of equity compensation were made under the Company’s 2012 Incentive Compensation Plan approved by the
Company’s shareholders, which is the only equity incentive plan under which the Company can currently make awards of
equity compensation.
Senior Executive Compensation
The Compensation Committee reviews the compensation packages for the Chief Executive Officer, the other Named
Executive Officers and the other senior executives believed to be the most important and influential in determining the
continued success of the Company.
In the spring of 2015, when the Compensation Committee made its determinations relating to executive compensation for the
Company’s Named Executive Officers for fiscal 2015, the Compensation Committee took into account, among other things, the
following:
• the Company’s net earnings per diluted share had increased to $5.07 for fiscal 2014 from $4.79 in the prior year;
• the Company had returned approximately $2.251 billion to shareholders through share repurchases in fiscal year 2014;
and
• the Company had made capital expenditures exceeding $300 million in fiscal 2014, principally for strategic investments
related to enhancing its omnichannel capabilities to further position the Company for continued growth and success in
the ever-evolving retail environment, and operated approximately 1,500 stores.
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