Bed Bath & Beyond (BBBY)

Item 1.01  Entry into a Material Definitive Agreement.

On November 16, 2009, Bed Bath & Beyond Inc. (the “Company”) entered into an amendment and restatement of its Supplemental Executive Retirement Benefit agreement, dated January 11, 2006, with Mr. Steven H. Temares, the Company’s Chief Executive Officer (the “SERP”), and a related escrow agreement (with the amendment and restatement and the related escrow agreement being hereinafter collectively referred to as the “Amendment”).

The Amendment was entered into principally to address the requirements of Section 409A of the Internal Revenue Code.  Under the SERP as previously in effect, in the event of a voluntary termination of employment by Mr. Temares after the twentieth anniversary of Mr. Temares’ employment with the Company (June 12, 2012), Mr. Temares would have, in general, been entitled to receive in each year over a 10-year period an amount equal to 50% of his annual base salary, payable in accordance with the Company’s normal payroll practices.  Under the Amendment, the Company would instead, six months after Mr. Temares’ voluntary termination, pay to Mr. Temares an amount equal to 1/10 of the present value of the installment payments described above, and pay into escrow 9/10 of such present value, in each case, net of all taxes required to be withheld as a result of the payment (including federal and state income taxes and all other applicable withholdings), with, in general, the amount in escrow being paid to Mr. Temares in equal installments on the first 9 anniversaries of the payment into escrow.  Consistent with the SERP as previously in effect, payment of the escrow amount to Mr. Temares would be subject to acceleration upon Mr. Temares’ death or a Change of Control of the Company (as defined in the SERP).  Under a separate agreement, Mr. Temares is subject to a non-competition restrictive covenant during the period of his employment with the Company and for one year thereafter.  Under the SERP as previously in effect, if Mr. Temares breaches the restrictive covenant (or engages in activities after the one-year non-competition period that would have constituted a breach during the non-competition period), any future payments during the 10-year installment payment period would have been forfeited.  Under the Amendment, in the event of any such breach (or activities after the one-year non-competition period that would have constituted a breach during such period), any remaining amount in escrow would be forfeited by Mr. Temares and repaid to the Company.  Any such forfeiture would leave Mr. Temares in substantially the same position as he was under the SERP as previously in effect.  Because any amount deposited into escrow under the Amendment would be net of the taxes imposed on the payment into escrow (including any amounts which may be subsequently forfeited by Mr. Temares and repaid to the Company), any such forfeiture would likely not make the Company whole for the taxes previously paid with respect to the forfeited amounts.  Accordingly, under the Amendment, Mr. Temares has agreed that in the event any amount in escrow is forfeited, he will use commercially reasonable efforts to obtain a refund of applicable taxes and remit such refund to the Company and the Company has agreed to reimburse Mr. Temares, or to pay on his behalf, reasonable legal fees and expenses incurred in connection with such a refund request.

As noted above, the Amendment has been drafted to comply with the requirements of Section 409A of the Internal Revenue Code and the regulations and guidance issued thereunder; however, in light of the complexities and uncertainties surrounding Section 409A, the Amendment also provides that Mr. Temares will be protected from any impact resulting from the possible application of Section 409A to the terms of the SERP such that Mr. Temares will be entitled to a payment that places him in that same economic position he would have been in under the SERP prior to the application of Section 409A.

The foregoing description of the Amendment is a summary only, and is qualified in its entirety by reference to Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K, which are incorporated herein by reference.

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On March 22, 2007, Bed Bath & Beyond Inc. (the “Company”) issued a press release announcing the acquisition of Buy Buy Baby, Inc. (“Baby”). A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

On March 22, 2007, the Company entered into a definitive agreement for and simultaneously closed on the purchase of Baby, a privately held retailer of infant and toddler merchandise, for approximately $67 million (net of cash acquired) and repayment of debt of approximately $19 million. Based in Garden City, New York, Baby operates a total of eight stores in New York, New Jersey, Maryland and Virginia. The stores range in size from 28,000 to 60,000 square feet and offer a broad assortment of premier infant and toddler merchandise in categories including furniture, car seats, strollers, feeding, bedding, bath, health and safety essentials, toys, learning and development products, clothing and a unique selection of seasonal and holiday products.

Baby was founded in 1996 by Richard and Jeffrey Feinstein, both of whom were previously employed by the Company and are the sons of Leonard Feinstein, one of the Company’s Co-Chairmen.  They will remain with Baby and continue to run its operations.  The acquisition was approved by a special committee of independent members of the Board of Directors of the Company. The special committee retained Merrill Lynch & Co. to serve as its independent financial advisor and render a fairness opinion in connection with the transaction, as well as Chadbourne & Parke LLP to serve as independent legal counsel to oversee the acquisition negotiations.  The Company’s Co-Chairmen, Leonard Feinstein and Warren Eisenberg, recused themselves from deliberations relating to the transaction.

Of the approximately $19 million of indebtedness repaid in connection with the transaction, approximately $16 million was held by Richard and Jeffrey Feinstein and approximately $3 million was held by Leonard Feinstein.  Richard and Jeffrey Feinstein, and Leonard Feinstein and his wife, have provided personal guaranties in respect of certain of Baby’s leases.  In connection with this transaction, the sellers negotiated to have the Company, as sole and controlling owner of Baby, assume these obligations. Therefore, under the terms of the purchase agreement, the Company has agreed to offer the landlords under these leases substitute guaranties from the Company on substantively the same terms as the existing personal guaranties, and to indemnify such guarantors against liability under the guaranties if the substitute guaranties are not accepted by the landlords.  The landlord of one of the Baby stores is an entity owned by the families of Richard and Jeffrey Feinstein; in connection with the transaction, the lease for that store was amended to make its terms more consistent with the Company’s standard lease terms.

Effective January 11, 2006, Bed Bath & Beyond Inc. (the “Company”) has entered into a Supplemental Executive Retirement Benefit agreement (the “Agreement”) with an executive officer. A copy of the Agreement is attached as Exhibit 10.1 and incorporated herein by reference.

Item 1.01               Entry into a Material Definitive Agreement

Effective January 1, 2006, Bed Bath & Beyond Inc. has adopted the Bed Bath & Beyond Inc. Nonqualified Deferred Compensation Plan (the “Plan”) for the benefit of certain employees as described in the Plan.  A copy of the Plan is attached as Exhibit 10.1 and incorporated herein by reference.

Item 1.01               Entry into A Material Definitive Agreement.

Historically, the Company has used stock options for all equity incentive awards to its executive officers.  At the Company's 2004 annual meeting, shareholders approved the Company's 2004 Incentive Compensation Plan, providing for awards of restricted stock as well as grants of stock options.  On April 20, 2005, the Compensation Committee made awards to executive officers consisting of a combination of restricted stock and stock option grants.  Consistent with past practice, the stock options granted to these executives will vest over time, subject, in general, to the executive’s remaining in the Company’s employ on specified vesting dates.  Vesting of the restricted stock awarded to these executives will be dependent on (i) the Company’s achievement of a performance-based test for the fiscal year of grant, and (ii) assuming achievement of the performance-based test, time vesting, subject, in general, to the executive remaining in the Company’s employ on specified vesting dates.

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