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<SEC-DOCUMENT>0000950123-02-005774.txt : 20020531
<SEC-HEADER>0000950123-02-005774.hdr.sgml : 20020531
<ACCEPTANCE-DATETIME>20020531121925
ACCESSION NUMBER: 0000950123-02-005774
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 12
CONFORMED PERIOD OF REPORT: 20020302
FILED AS OF DATE: 20020531
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: BED BATH & BEYOND INC
CENTRAL INDEX KEY: 0000886158
STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-HOME FURNITURE, FURNISHINGS & EQUIPMENT STORES [5700]
IRS NUMBER: 112250488
STATE OF INCORPORATION: NY
FISCAL YEAR END: 0228
FILING VALUES:
FORM TYPE: 10-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-20214
FILM NUMBER: 02667406
BUSINESS ADDRESS:
STREET 1: 650 LIBERTY AVENUE
CITY: UNION
STATE: NJ
ZIP: 07083
BUSINESS PHONE: 2013791520
MAIL ADDRESS:
STREET 1: 715 MORRIS AVENUE
CITY: SPRINGFIELD
STATE: NJ
ZIP: 07081
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>y61131e10vk.htm
<DESCRIPTION>ANNUAL REPORT ON FORM 10-K
<TEXT>
<HTML>
<HEAD>
<TITLE>BED BATH & BEYOND INC.</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<HR size="4" noshade color="#000000" style="margin-top: -5px">
<HR size="1" noshade color="#000000" style="margin-top: -10px">
<P align="center"><FONT size="4"><B>SECURITIES AND EXCHANGE COMMISSION</B>
</FONT>
<DIV align="center"><FONT size="2"><B>Washington, D.C. 20549</B>
</FONT></DIV>
<P>
<HR width="26%" align="center" size="1" noshade>
<P>
<P align="center"><FONT size="4"><B>FORM 10-K</B>
</FONT>
<P align="center"><FONT size="2"><B>Annual Report Pursuant to Section 13 or 15(d) of the Securities<BR>
Exchange Act of 1934</B><BR>
For the fiscal year ended March 2, 2002
</FONT>
<P align="center"><FONT size="2">Commission File Number 0-20214
</FONT>
<P align="center"><FONT size="5"><B><U>BED BATH & BEYOND INC.</U></B>
</FONT>
<DIV align="center"><FONT size="2">(Exact name of registrant as specified in its charter)
</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="50%"> </TD>
<TD width="5%"> </TD>
<TD width="45%"> </TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2"><B>New York</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
<B>11-2250488</B></FONT></TD>
</TR>
<TR>
<TD align="center" valign="top"><HR size="1" noshade></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
<HR size="1" noshade></FONT></TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2">(State of incorporation)</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
(IRS Employer Identification No.)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2"><B>650 Liberty Avenue, Union, New Jersey</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
<B>07083</B></FONT></TD>
</TR>
<TR>
<TD align="center" valign="top"><HR size="1" noshade></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
<HR size="1" noshade></FONT></TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2">(Address of principal executive offices)</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
(Zip Code)</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">Registrant’s telephone number, including area code: <B><U>908/688-0888</U></B>
</FONT>
<P align="center"><FONT size="2"><B>Securities registered pursuant to Section 12(b) of the Act:</B>
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="50%"> </TD>
<TD width="5%"> </TD>
<TD width="45%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Name of each exchange on</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Title of each class</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>which registered</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD align="center" valign="top"><FONT size="2">None</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center" valign="top"><FONT size="2">
None</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2"><B>Securities registered pursuant to Section 12(g) of the Act:</B>
</FONT>
<P align="center"><FONT size="2"><B><U>Common Stock (par value $ 0.01 per share)</U></B><BR>
(Title of class)
</FONT>
<P><FONT size="2">Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes <IMG src="y61131checkbox.gif" alt="checkbox"> No <IMG src="y61131box.gif" alt="box">
</FONT>
<P><FONT size="2">Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. <IMG src="y61131box.gif" alt="box">
</FONT>
<P><FONT size="2">As of May 3, 2002, the aggregate market value of the common stock held by
non-affiliates (which was computed by reference to the closing price on such
date of such stock on the NASDAQ National Market) was $10,067,470,417.*
</FONT>
<P><FONT size="2">The number of shares outstanding of the issuer’s common stock (par value $0.01
per share) at May 3, 2002: 291,929,613
</FONT>
<P align="center"><FONT size="2"><B><u>Documents Incorporated by Reference</U></B>
</FONT>
<P><FONT size="2">Portions of the Registrant’s definitive proxy statement dated May 22, 2002
pursuant to Regulation 14A are incorporated by reference in Part III hereof.
</FONT>
<P><FONT size="2">Portions of the Registrant’s Annual Report to Shareholders for the fiscal year
ended March 2, 2002 are incorporated by reference in Part II hereof.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2">*</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">For purposes of this calculation, all outstanding shares of common stock have
been considered held by non-affiliates other than the 17,611,618 shares
beneficially owned by directors and executive officers, including in the case of
the Co-Chief Executive Officers trusts and foundations affiliated with them. In
making such calculation, the Registrant does not determine the affiliate or
non-affiliate status of any shares for any other purpose.</FONT></TD>
</TR>
</TABLE>
<P>
<HR size="1" noshade color="#000000" style="margin-top: -2px">
<HR size="4" noshade color="#000000" style="margin-top: -10px">
<P align="center"><FONT size="2">1</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<!-- TOC -->
<A name="toc"><DIV align="CENTER" style="page-break-before:always"><U><B>TABLE OF CONTENTS</B></U></DIV></A>
<P><CENTER>
<TABLE border="0" width="90%" cellpadding="0" cellspacing="0">
<TR>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="3%"></TD>
<TD width="76%"></TD>
</TR>
<TR><TD colspan="9"><A HREF="#000">PART I</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#001">ITEM 1 — BUSINESS</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#002">ITEM 2 — PROPERTIES</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#003">ITEM 3 — LEGAL PROCEEDINGS</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#004">ITEM 4 — SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#005">ITEM 5 — MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#006">ITEM 6 — SELECTED FINANCIAL DATA</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#007">ITEM 7 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#008">ITEM 7A — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#009">ITEM 8 — FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#010">ITEM 9 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE</A></TD></TR>
<TR><TD colspan="9"><A HREF="#011">PART III</A></TD></TR>
<TR><TD colspan="9"><A HREF="#012">PART IV</A></TD></TR>
<TR><TD></TD><TD colspan="8"><A HREF="#013">ITEM 14 — EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K</A></TD></TR>
<TR><TD colspan="9"><A HREF="#014">SIGNATURES</A></TD></TR>
<TR><TD colspan="9"><A HREF="#015">Independent Auditor’s Report on Schedule</A></TD></TR>
<TR><TD colspan="9"><A HREF="y61131exv10w18.htm">EXHIBIT 10.18</A></TD></TR>
<TR><TD colspan="9"><A HREF="y61131exv10w19.htm">EXHIBIT 10.19</A></TD></TR>
<TR><TD colspan="9"><A HREF="y61131exv13.htm">EXHIBIT 13</A></TD></TR>
<TR><TD colspan="9"><A HREF="y61131exv21.htm">EXHIBIT 21</A></TD></TR>
<TR><TD colspan="9"><A HREF="y61131exv23.htm">EXHIBIT 23</A></TD></TR>
</TABLE>
</CENTER>
<!-- /TOC -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P align="center"><FONT size="2"><B>TABLE OF CONTENTS</B>
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="4%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="73%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Form 10-K</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Item No.</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="2"><FONT size="1"><B>Name of Item</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="2"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>PART I</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 1.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Business</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 2.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Properties</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">12</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 3.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Legal Proceedings</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">13</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 4.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Submission of Matters to a Vote of
Security Holders</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">13</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>PART II</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 5.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Market for the Registrant’s Common Equity
And Related Shareholder Matters</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">13</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 6.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Selected Financial Data</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 7.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Management’s Discussion and Analysis
of Financial Condition and Results of
Operations</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 7A.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Quantitative and Qualitative Disclosures About
Market Risk</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 8.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Financial Statements and Supplementary
Data</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 9.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Changes in and Disagreements with
Accountants on Accounting and Financial
Disclosure</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>PART III</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 10.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Directors and Executive Officers of
the Registrant</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 11.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Executive Compensation</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 12.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Security Ownership of Certain Beneficial
Owners and Management</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3" valign="top"><FONT size="2">Item 13.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Certain Relationships and Related
Transactions</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>PART IV</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top" align="right"><FONT size="2"> </FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3" valign="top"><FONT size="2">Item 14.</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Exhibits, Financial Statement Schedules and
Reports on Form 8-K</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">15</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">2</FONT>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<!-- link1 "PART I" -->
<DIV align="left"><A NAME="000"></A></DIV>
<P align="center"><FONT size="2"><B>PART I</B>
</FONT>
<P><FONT size="2"> <I>Unless otherwise indicated, the terms “Company” and “Bed Bath & Beyond”
refer collectively to Bed Bath & Beyond Inc. and its subsidiaries as of March
2, 2002. The Company’s fiscal year is comprised of the 52 or 53 week period
ending on the Saturday nearest February 28. Accordingly, fiscal 2001
represented 52 weeks and ended on March 2, 2002; fiscal 2000 represented 53
weeks and ended on March 3, 2001; and fiscal 1999 represented 52 weeks and
ended on February 26, 2000. Unless otherwise indicated, all references herein
to periods of time (e.g., quarters and years) are to fiscal periods.</I>
</FONT>
<!-- link2 "ITEM 1 — BUSINESS" -->
<DIV align="left"><A NAME="001"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 1 — BUSINESS</B>
</FONT>
<P align="left"><FONT size="2"><B>Introduction</B>
</FONT>
<P><FONT size="2"> Bed Bath & Beyond believes that it is the nation’s largest operator of
stores selling predominantly better quality domestics merchandise and home
furnishings typically found in better department stores. Bed Bath & Beyond
stores are typically larger in size than other stores in its market selling
similar product categories and offering a breadth and depth of selection in
most of its product categories. The Company offers a wide assortment of
merchandise at everyday low prices that are substantially below regular
department store prices and generally comparable to or below department store
sale prices. The Company’s domestics merchandise line includes items such as
bed linens, bath accessories and kitchen textiles, and the Company’s home
furnishings line includes items such as cookware, dinnerware, glassware and
basic housewares. The Company believes that it offers a breadth and depth of
selection in most of its product categories that far exceeds what is generally
available in department stores or other specialty retail stores and that this
enables it to offer customers the convenience of one-stop shopping for most
household items.
</FONT>
<P><FONT size="2"> As of May 3, 2002, the Company operated 407 Bed Bath & Beyond stores in 44
states and one territory: Alabama (5), Arizona (5), Arkansas (2), California
(45), Colorado (12), Connecticut (7), Delaware (1), Florida (35), Georgia (14),
Idaho (1), Illinois (16), Indiana (8), Iowa (3), Kansas (5), Kentucky (3),
Louisiana (5), Maine (2), Maryland (11), Massachusetts (9), Michigan (19),
Minnesota (7), Mississippi (1), Missouri (7), Nebraska (1), Nevada (2), New
Hampshire (1), New Jersey (21), New Mexico (1), New York (18), North Carolina
(14), North Dakota (2), Ohio (16), Oklahoma (3), Oregon (4), Pennsylvania (20),
Rhode Island (2), South Carolina (6), Tennessee (7), Texas (31), Utah (4),
Vermont (1), Virginia (16), Washington (10), Wisconsin (3), and Puerto Rico
(1). These stores principally range in size from 25,000 square feet to 50,000
square feet, with some exceeding 80,000 square feet, and carry the Company’s
full line of both domestics merchandise and home furnishings.
</FONT>
<P align="left"><FONT size="2"><B>History</B>
</FONT>
<P><FONT size="2"> The Company was founded in 1971 by Leonard Feinstein and Warren Eisenberg,
the Co-Chief Executive Officers of the Company. Each has more than 40 years of
experience in the retail industry.
</FONT>
<P><FONT size="2"> The Company commenced operations in 1971 with the opening of two stores,
one in New York and one in New Jersey. These stores sold primarily bed linens
and bath accessories. In 1985, the Company introduced its first store carrying
a full line of domestics merchandise and home furnishings. The Company began
using the name “Bed Bath & Beyond” in 1987 in order to reflect the expanded
product line offered by its stores and to distinguish its stores from
conventional specialty retail stores offering only domestics merchandise or
home furnishings.
</FONT>
<P align="center"><FONT size="2">3</FONT>
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<P><FONT size="2"> The Company has been engaged in an ongoing expansion program involving the
opening of new Bed Bath & Beyond stores (including 85 in 2001, 70 in 2000, and
55 in 1999) and the expansion and relocation of existing stores (including two
in 2000, and four in 1999). As a result of its expansion program, the
Company’s store space has increased from approximately 917,000 square feet at
the beginning of 1992 to approximately 14,724,000 square feet at the end of
2001. The Company’s expansion program is continuing, and the Company currently
anticipates that in fiscal 2002 it will open approximately 88 new stores, which
includes the eleven new stores opened through May 3, 2002.
</FONT>
<P align="left"><FONT size="2"><B>Merchandising and Marketing</B>
</FONT>
<P><FONT size="2"> The Company’s strategy for merchandising and marketing is to offer better
quality merchandise at everyday low prices; to maintain a breadth and depth of
selection in its product categories that far exceeds what is generally
available in department stores or other specialty retail stores; to present
merchandise in a distinctive manner designed to maximize customer convenience
and reinforce customer perception of wide selection; and to emphasize
dedication to customer service and satisfaction.
</FONT>
<P><FONT size="2"> <B><u>Merchandise
Selection</u></B>
</FONT>
<P><FONT size="2"> The Company’s stores offer both domestics merchandise and home
furnishings, which include:
</FONT>
<P><FONT size="2"> <u>Domestics
Merchandise</u>
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">bed linens and related items: sheets, comforters, duvet covers,
bedspreads, quilts, window treatments (such as curtains and
valances), decorative pillows, blankets, dust ruffles, bed pillows
and mattress pads.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">bath items: towels, shower curtains and liners, waste baskets,
mirrors, hampers, robes, slippers, scales, bathroom rugs, wall
hardware and other bath accessories.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">kitchen textiles: tablecloths, placemats, cloth napkins, dish
towels and chair pads.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2"> <u>Home
Furnishings</u>
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">kitchen and tabletop items: cookware, cutlery, kitchen gadgets,
dinnerware, bakeware, flatware, drinkware, serveware, glassware, food
storage containers, tea kettles, trash cans and cleaning supplies.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">fine tabletop and giftware: formal dinnerware china, fine
crystal stemware and barware, crystal giftware, metal giftware and
flatware.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">basic housewares: storage items, closet-related items (such as
hangers, organizers and shoe racks), general housewares (such as
brooms, garbage pails and ironing boards), lifestyle accessories
(such as lamps, chairs, ready to assemble furniture, furniture
covers, accent rugs, wicker, fountains and clocks) and small electric
appliances (such as blenders, food processors, coffee makers,
vacuums, irons, toaster ovens, hair dryers, heaters and humidifiers).</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="5%"><FONT size="2"> </FONT></TD>
<TD width="1%" align="left" nowrap><FONT size="2">•</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="91%"><FONT size="2">general home furnishings: giftwrap, candles, personal care
products (such as soaps and lotions), picture frames, wall art,
juvenile items (such as toys and children’s books), artificial plants
and flowers and seasonal merchandise (such as summer and
holiday-related items).</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2"> The Company, on an ongoing basis, tests new merchandise categories and
adjusts the categories of merchandise carried in its stores and may add new
departments or adjust the size of existing departments as required. The Company
believes that the process of adding new departments and expanding or reducing
the size of various departments in response to changing conditions is an
important part of its merchandising strategy.
</FONT>
<P align="center"><FONT size="2">4</FONT>
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<P><FONT size="2"> The Company’s merchandise consists primarily of better quality merchandise
typically found at better department stores. For those product lines that have
brand names associated with them, the Company generally offers leading brand
name merchandise (including All-Clad, American Pacific, Black & Decker, Braun,
Brentwood, Brita, Calphalon, Cannon, Conair, Croscill, Cuisinart, Divatex,
Fieldcrest, Gillette, Hamilton Beach, Homedics, Hoover, J.A. Henckels,
KitchenAid, Krups, Laura Ashley, Martex, Mikasa, Nautica, Newell, Noritake,
OXO, Pacific Coast Feather Co., Pillowtex, Portmeirion, Reed & Barton, Royal
Doulton, Rubbermaid, Spode, Springs, Umbra, Villeroy & Boch, Wamsutta, Waverly
and Yankee Candle). The Company believes that brand name merchandise accounts
for a significant portion of its net sales.
</FONT>
<P><FONT size="2"> The Company offers a breadth and depth of product selection that enables
customers to select among a wide assortment of styles, brands, colors and
designs within each of the Company’s major product lines. The Company also
generally maintains consistent in-stock availability of merchandise in order to
reinforce customer perception of wide selection and build customer loyalty.
The Company estimates that most of its stores carry in excess of 30,000 active
stock-keeping units.
</FONT>
<P><FONT size="2"> <B><u>Pricing
Policy</u></B>
</FONT>
<P><FONT size="2"> The Company’s pricing policy is to maintain everyday low prices that are
substantially below regular department store prices and generally comparable to
or below department store sale prices. The Company regularly monitors price
levels at its competitors in order to ensure that the Company’s prices are
being maintained in accordance with its pricing policy. The Company believes
that the application of its everyday low price policy is essential to
maintaining the integrity of this policy and is an important factor in
establishing its reputation among customers.
</FONT>
<P><FONT size="2"> Because the Company has an everyday low price policy, the Company does not
run sales. However, the Company uses periodic markdowns and semi-annual
clearances for merchandise that it has decided to discontinue carrying. In
addition, the Company’s full-color circulars and mailing pieces include a
coupon, which may be redeemed at the point-of-sale. The Company also honors
competitor coupons.
</FONT>
<P><FONT size="2"> <B><u>Merchandise
Presentation</u></B>
</FONT>
<P><FONT size="2"> The Company has developed a distinctive style of merchandise presentation.
In each store, groups of related product lines are presented together in
separate areas of the store, creating the appearance that a Bed Bath & Beyond
store is comprised of several individual specialty stores for different product
lines. A “racetrack layout” that runs throughout the store facilitates moving
between areas and encourages customers to shop the entire store. The Company
believes that its format of merchandise presentation makes it easy for
customers to locate products, reinforces customer perception of wide selection
and communicates to customers that Bed Bath & Beyond stores offer a level of
customer service generally associated with smaller specialty stores.
</FONT>
<P><FONT size="2"> Merchandise is displayed in each of these separate areas from floor to
ceiling (generally 10 to 14 feet high) and, in addition, seasonal merchandise
and impulse items are prominently displayed in the front of the store. The
Company believes that its extensive merchandise selection, rather than
fixturing, should be the focus of customer attention and, accordingly,
typically uses simple modular fixturing throughout the store. This fixturing
is designed so that it can be easily reconfigured to adapt to changes in the
store’s merchandise mix and presentation. The Company believes that its floor
to ceiling displays create an exciting and attractive shopping environment that
encourages impulse purchases of additional items.
</FONT>
<P align="center"><FONT size="2">5</FONT>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P><FONT size="2"> <B><u>Customer
Service</u></B>
</FONT>
<P><FONT size="2"> The Company places great emphasis on customer service and satisfaction
and, over the past 30 years, has made this a defining feature of its corporate
culture. All managers provide leadership by example in this area by regularly
spending time assisting customers on the selling floor. The Company believes
that its success in the area of customer service is evidenced by its ability to
rely primarily on “word of mouth advertising”.
</FONT>
<P><FONT size="2"> The Company seeks to make shopping at its stores as pleasant and
convenient as possible. Each area within a store is staffed with knowledgeable
sales personnel who are available to assist customers in choosing merchandise,
to answer questions and to resolve any issues that may arise. In order to make
checking out convenient, checkout lines are continually monitored and
additional cashiers are added as necessary in order to minimize waiting time.
Returning merchandise is simplified through a return policy that permits
customers to return most items without presenting a sales receipt. Most Bed
Bath & Beyond stores are open seven days (and six evenings) a week in order to
enable customers to shop at times that are convenient for them.
</FONT>
<P><FONT size="2"> The Company launched its website, www.bedbathandbeyond.com, in 1999. The
website offers a broad range of online services and features, including online
shopping and gift registry. The Company believes that its E-Service efforts
have been well received by its customers.
</FONT>
<P><FONT size="2"> <B><u>Advertising</u></B>
</FONT>
<P><FONT size="2"> In general, the Company relies on “word of mouth advertising” and on its
reputation for offering a wide assortment of quality merchandise at everyday
low prices, supplemented by the use of paid advertising. The Company uses
full-color circulars and mailing pieces as its primary vehicles of paid
advertising. Also, to support the opening of new stores, the Company uses
“grand opening” full-color circulars and newspaper advertising. The Company
believes that its ability to rely primarily on “word of mouth advertising” will
continue and that its limited use of paid advertising permits it to spend less
on advertising than a number of its competitors.
</FONT>
<P><FONT size="2"> <B><u>Expansion</u></B>
</FONT>
<P><FONT size="2"> The Company is engaged in an ongoing expansion program involving the
opening of new stores in both existing and new markets and the expansion or
relocation of existing stores with larger stores. As a result of this
program, the total number of stores has increased from 34 at the beginning of
fiscal 1992 to 396 at the end of fiscal 2001, and the total square footage of
store space has increased from approximately 917,000 square feet at the
beginning of fiscal 1992 to approximately 14,724,000 square feet at the end of
fiscal 2001. During 2001, the Company opened 85 new stores, which resulted in
the addition of approximately 2,520,000 square feet of store space.
</FONT>
<P align="center"><FONT size="2">6</FONT>
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<P><FONT size="2"> The table below sets forth information concerning the Company’s expansion
program for the periods indicated:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="12%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="8%"> </TD>
<TD width="1%"> </TD>
<TD width="9%"> </TD>
<TD width="5%"> </TD>
<TD width="12%"> </TD>
<TD width="1%"> </TD>
<TD width="13%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="2%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="2%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="7"><FONT size="1"><B>Store Space</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="7"><FONT size="1"><B>Number of Stores</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="7"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="7"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Relocated</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>New</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Beginning</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>End</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Beginning</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>End</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Year</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Stores (1)</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Stores (2)</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>of Year</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>of Year</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>of Year</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>of Year</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center" colspan="25"><FONT size="1"><B><I>(in square feet)</I></B></FONT></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1992</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">917,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,128,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">34</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">38</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1993</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">9</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,128,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,512,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">38</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">45</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1994</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">16</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,512,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2,339,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">45</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">61</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1995</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">19</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2,339,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3,214,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">61</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">80</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1996</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">28</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3,214,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4,347,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">80</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">108</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1997</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">33</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4,347,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5,767,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">108</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">141</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1998</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">45</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5,767,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7,688,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">141</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">186</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1999</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">55</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7,688,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">9,815,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">186</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">241</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">2000</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">70</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">9,815,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">12,204,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">241</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">311</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD align="center"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">2001</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">0</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">85</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">12,204,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14,724,000</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">311</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">396</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><I>(1)</I></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><I>A relocated store is an existing store that was either expanded or
relocated to a new store in the same area.</I></FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><I>(2)</I></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><I>Excludes any new store that replaced an existing store in the same area.</I></FONT></TD>
</TR>
</TABLE>
<P><FONT size="2"> The Company intends to continue its expansion program and believes that
the continued growth of the Company is dependent, in large part, on the success
of this program. As part of its expansion program, the Company expects to open
new stores and, in addition, expects to expand existing stores as opportunities
arise.
</FONT>
<P><FONT size="2"> The Company expects to open new stores in new and existing markets. In
determining where to open new stores, the Company evaluates a number of
factors, including the availability of prime real estate and demographic
information (such as data relating to income and education levels, age and
occupation). The Company believes that because it does not use central
distribution centers, and since it relies on paid advertising to only a limited
extent, it has the flexibility to enter a new market with only one or two
stores. The Company will consider opening additional stores in that market
after the stores have been proven successful.
</FONT>
<P><FONT size="2"> From the end of fiscal 2001 through May 3, 2002, the Company has opened
eleven stores which are located in: Encino and Monrovia, California; Grand
Junction, Colorado; Manchester, Connecticut; Cumming, Georgia; Woodbury,
Minnesota; Mount Olive, New Jersey; Onslow, North Carolina; Eastgate, Ohio;
Erie, Pennsylvania; and Lynchburg, Virginia. During the balance of 2002, the
Company currently anticipates that it will open approximately 77 additional
stores.
</FONT>
<P><FONT size="2"> The Company has built its management structure with a view towards its
expansion and believes that, as a result, the Company has the management depth
necessary to support its anticipated expansion program. Each of the Company’s
area managers typically supervises up to three stores and district managers
typically supervise four to ten stores.
</FONT>
<P align="left"><FONT size="2"><B>Store Operations</B>
</FONT>
<P><FONT size="2"> <B><u>Merchandising</u></B>
</FONT>
<P><FONT size="2"> The Company maintains its own central buying group, comprising of three
Vice President — General Merchandising Managers, as well as a large staff of
divisional merchandising managers, buyers and assistant buyers. Merchandising
activities are overseen by the Chief Merchandising Officer and Senior Vice
President. The merchandise mix for each store is initially selected by the
central buying group, in consultation with store managers and other local store
personnel. The central buying group is generally responsible for the
procurement of merchandise, including: selecting the merchandise, ordering the
initial inventory required upon the opening of each store, ordering the first
shipment of any new product line that may be subsequently added to a store’s
merchandise mix and ordering seasonal merchandise.
</FONT>
<P align="center"><FONT size="2">7</FONT>
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<P><FONT size="2"> After a store is opened, local store personnel are primarily responsible
for monitoring inventory levels and reordering merchandise as required. In
addition, local store personnel are encouraged to monitor local sales trends
and market conditions and tailor the merchandise mix as appropriate to respond
to changing trends and conditions. The Company believes that its policy of
having the reordering function performed at the local store level, rather than
centrally, and having local store personnel determine the appropriate quantity
to reorder, encourages entrepreneurship at the store level. In addition, this
better ensures that in-stock availability will be maintained in accordance with
the specific requirements of each store. The factors taken into account in
selecting the merchandise mix for a particular store include store size and
configuration and local market conditions such as climate and demographics.
</FONT>
<P><FONT size="2"> The Company purchases its merchandise from more than 3,100 suppliers. In
2001, the Company’s largest supplier accounted for approximately 6% of the
Company’s merchandise purchases and the Company’s 10 largest suppliers
accounted for approximately 26% of such purchases. The Company purchases
substantially all of its merchandise in the United States, the majority from
domestic manufacturers and the balance from importers. The Company purchases a
small amount of its merchandise directly from overseas sources. The Company
has no long-term contracts for the purchase of merchandise. The Company
believes that most merchandise, other than brand name goods, is available from
a variety of sources and that most brand name goods can be replaced with
comparable merchandise.
</FONT>
<P><FONT size="2"> <B><U>Warehousing</U></B>
</FONT>
<P><FONT size="2"> Merchandise is shipped to each store from the Company’s vendors, making it
unnecessary for the Company to maintain central distribution centers. As a
result of the floor to ceiling displays used by the Company, a substantial
amount of merchandise is displayed on the sales floor of each store at all
times. Additional merchandise not displayed on the sales floor is stored in
warehouse space within or near the store (with an estimated 10% to 15% of the
store space dedicated to warehouse and receiving space). In the case of a few
stores, merchandise is also stored at nearby supplemental storage space leased
by the Company. At present, the warehouse space included in the Company’s
stores provides approximately 87% of the Company’s warehouse space requirements
and such nearby supplemental storage space provides the balance.
</FONT>
<P><FONT size="2"> <B><U>Management</U></B>
</FONT>
<P><FONT size="2"> The Company encourages responsiveness and entrepreneurship at the store
level by providing its managers with a relatively high degree of autonomy
relating to operations and merchandising. This is reflected in the Company’s
policy of having reordering conducted at the store level, as well as in the
Company’s policy of encouraging managers to tailor the merchandise mix of each
store in response to local sales trends and market conditions.
</FONT>
<P><FONT size="2"> In general, stores are staffed with two assistant managers, one operating
manager, and three to six department managers who all report to a store
manager, who in turn is supervised by an area or district manager. Area and
district managers report to one of several regional managers or directly to one
of five regional Vice Presidents of Stores, who in turn report to the Senior
Vice President — Stores. Decisions relating to pricing and advertising for all
stores are made centrally in the Company’s Procurement Office, and certain
store support functions (such as finance and information technology) are
performed centrally in the Company’s Corporate Office.
</FONT>
<P><FONT size="2"> <B><U>Training</U></B>
</FONT>
<P><FONT size="2"> The Company places great emphasis on the training of store level
management. All entry-level management personnel are generally required to
work in various departments of the store to acquire an overall understanding of
store operations. In addition, all associates receive formalized training,
including sales techniques and product knowledge, through the Bed Bath & Beyond
University program.
</FONT>
<P align="center"><FONT size="2">8</FONT>
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<P><FONT size="2"> The Company’s policy is to generally build its management organization
from within. Each of the Company’s area, district and regional managers was
recruited from the ranks of the Company’s store managers and each of the
Company’s store managers joined the Company in an entry-level position. The
Company believes that its policy of promoting from within, as well as the
opportunities for advancement generated by its ongoing expansion program, serve
as an incentive to persons to seek and retain employment with the Company
resulting in low turnover among its managers.
</FONT>
<P><FONT size="2"><B>Employees</B>
</FONT>
<P><FONT size="2"> As of March 2, 2002, the Company employed approximately 19,000 persons, of
whom approximately 11,000 were full-time employees and approximately 8,000 were
part-time employees. None of the Company’s Bed Bath & Beyond employees are
covered by collective bargaining agreements. The Company believes that its
relations with its employees are excellent and that the labor turnover rate
among its management employees is lower than that experienced within the
industry.
</FONT>
<P><FONT size="2"><B>Seasonality</B>
</FONT>
<P><FONT size="2"> The Company’s Bed Bath & Beyond stores exhibit less seasonality than many
other retail businesses, although sales levels are generally higher in August,
November and December, and generally lower in February and March.
</FONT>
<P><FONT size="2"><B>Competition</B>
</FONT>
<P><FONT size="2"> The market for domestics merchandise and home furnishings is fragmented
and highly competitive. While the Company believes it is the preeminent
marketer in its segment of the home goods industry, it competes directly with a
small number of chains of stores selling domestics merchandise and home
furnishings. In addition, the Company competes with many different types of
retail stores that sell many or most of the products sold by the Company. Such
competitors include: (i) better department stores, which often carry many of
the same product lines as the Company but do not typically have the same depth
or breadth of product selection, (ii) specialty stores (such as specialty
linens or housewares retailers), which often have a depth of product selection
but typically carry only a limited portion of the product lines carried by the
Company, and (iii) discount and mass merchandise stores. In addition, the
Company competes to a more limited extent with factory outlet stores that
typically offer limited quantities or limited lines of better quality
merchandise at discount prices.
</FONT>
<P><FONT size="2"> The Company believes that it is the largest operator of stores selling
predominantly better quality domestics merchandise and home furnishings
typically found in better department stores, and that it is well positioned to
compete successfully in its markets as measured by several factors, including
pricing, breadth and quality of product selection, in-stock availability of
merchandise, effective merchandise presentation, customer service and store
locations.
</FONT>
<P><FONT size="2"> The visibility of the Company has encouraged competitors to imitate the
Company’s format and methods.
Other retail chains continue to introduce new store concepts that include many
of the product lines carried by the Company. There can be no assurance that
the operation of store competitors, including those companies operating stores
similar to those of Bed Bath & Beyond, will not have a material effect on the
Company.
</FONT>
<P align="center"><FONT size="2">9</FONT>
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<P align="left"><FONT size="2"><B>Trade Names and Service Marks</B>
</FONT>
<P><FONT size="2"> The Company uses its nationally recognized “Bed Bath & Beyond” name and
logo and its “Beyond any store of its kind” tag line as service marks in
connection with retail services. The Company has registered these marks and
others with the United States Patent and Trademark Office. The Company also
has registered or has applications pending with the trademark registries of
several foreign countries. Management believes that its name recognition and
service marks are an important element of the Company’s merchandising strategy.
</FONT>
<P align="left"><FONT size="2"><B>Harmon Stores, Inc.</B>
</FONT>
<P><FONT size="2"> On March 5, 2002, the Company consummated the acquisition of Harmon
Stores, Inc., a health and beauty care retailer. As of May 3, 2002, the
Company operated 28 Harmon stores in 3 states: Connecticut (1), New Jersey
(22), and New York (5). These stores are primarily located in strip centers
and principally range in size from 5,000 square feet to 8,700 square feet.
</FONT>
<P><FONT size="2"> Harmon sells a broad variety of merchandise, primarily including health
and beauty products and cosmetics. The chain competes with drug store chains,
discount and mass merchandise stores, and supermarkets, among others. The Company
believes the acquisition will not have a material effect on its consolidated
results of operations or financial condition in fiscal 2002.
</FONT>
<P align="center"><FONT size="2">10</FONT>
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<P align="left"><FONT size="2"><B>Executive Officers of the Registrant</B>
</FONT>
<P><FONT size="2"> The following table sets forth the name, age and business experience of
the Executive Officers of the Registrant:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="30%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="57%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Name</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Age</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Positions</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Warren Eisenberg</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
71
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Co-Chairman, Co-Chief Executive Officer
and Director</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Leonard Feinstein</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
65
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Co-Chairman, Co-Chief Executive Officer
and Director</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Steven H. Temares</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
43
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">President, Chief Operating
Officer and Director</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Ronald Curwin</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
72
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Chief Financial Officer and Treasurer</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Arthur Stark</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
47
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Chief Merchandising Officer
and Senior Vice President</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">Matthew Fiorilli</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right" valign="top"><FONT size="2"> </FONT></TD>
<TD align="right" valign="top"><FONT size="2">
45
</FONT></TD>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Senior Vice President — Stores</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2"> <I>Mr. Eisenberg</I>, a co-founder of the Company, has been a director and
officer of the Company since the Company commenced operations in 1971 (serving
as President and Co-Chief Executive Officer until 1992, as Chairman and
Co-Chief Executive Officer until 1999, thereafter as Co-Chairman and Co-Chief
Executive Officer).
</FONT>
<P><FONT size="2"> <I>Mr. Feinstein</I>, a co-founder of the Company, has been a director and
officer of the Company since the Company commenced operations in 1971 (serving
as Co-Chief Executive Officer, Treasurer and Secretary until 1992, as President
and Co-Chief Executive Officer until 1999, thereafter as Co-Chairman and
Co-Chief Executive Officer).
</FONT>
<P><FONT size="2"> <I>Mr. Temares </I>joined the Company in 1992. Mr. Temares has been President
and Chief Operating Officer of the Company since January 1999. Prior to 1999,
Mr. Temares served as Executive Vice President — Chief Operating Officer from
1997 to 1999 and previously was Director of Real Estate and General Counsel.
</FONT>
<P><FONT size="2"> <I>Mr. Curwin</I>, a certified public accountant, joined the Company in 1994 as
Chief Financial Officer and Treasurer.
</FONT>
<P><FONT size="2"> <I>Mr. Stark </I>joined the Company in 1977. Mr. Stark has been Chief
Merchandising Officer and Senior Vice President since January 1999. Prior to
1999, Mr. Stark was Vice President — Merchandising from 1998 until 1999,
Director of Store Operations — Western Region from 1994 until 1998.
</FONT>
<P><FONT size="2"> <I>Mr. Fiorilli </I>joined the Company in 1973. Mr. Fiorilli has been Senior
Vice President — Stores since January 1999. Prior to 1999, Mr. Fiorilli was
Vice President — Stores from 1998 until 1999, Director of Store Operations — Eastern Region from 1994 until 1998.
</FONT>
<P><FONT size="2"> The Company’s executive officers are elected by the Board of Directors for
one-year terms and serve at the discretion of the Board of Directors. No
family relationships exist between any of the executive officers or directors
of the Company.
</FONT>
<P align="center"><FONT size="2">11</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<!-- link2 "ITEM 2 — PROPERTIES" -->
<DIV align="left"><A NAME="002"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 2 — PROPERTIES</B>
</FONT>
<P><FONT size="2"> The Company’s 407 Bed Bath & Beyond stores are located in 44 states and
one territory, principally in suburban areas of medium and large-sized cities.
These stores are situated in strip and power strip shopping centers, as well as
in major off-price and conventional malls, and free standing buildings. The
Company’s stores range in size from 7,000 to 103,000 square feet, but are
predominantly between 25,000 square feet and 50,000 square feet in major
markets. Approximately 85% to 90% of store space is used for selling areas and
the balance for warehouse, receiving and office space.
</FONT>
<P><FONT size="2"> The table below sets forth the number of stores located in each state and
one territory as of May 3, 2002:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="41%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="18%"> </TD>
<TD width="1%"> </TD>
<TD width="19%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
<TD width="1%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><I>Number of</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><I>Number of</I></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><I>State</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><I>Stores</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><I>State</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><I>Stores</I></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Alabama</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Nebraska</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Arizona</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Nevada</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Arkansas</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">New Hampshire</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">California</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">45</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">New Jersey</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">21</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Colorado</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">12</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">New Mexico</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Connecticut</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">New York</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">18</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Delaware</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">North Carolina</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Florida</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">35</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">North Dakota</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Georgia</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">14</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Ohio</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">16</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Idaho</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Oklahoma</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Illinois</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">16</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Oregon</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Indiana</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">8</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Pennsylvania</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">20</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Iowa</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Rhode Island</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Kansas</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">South Carolina</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">6</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Kentucky</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Tennessee</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Louisiana</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Texas</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">31</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Maine</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Utah</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Maryland</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">11</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Vermont</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Massachusetts</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">9</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Virginia</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">16</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Michigan</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">19</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Washington</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">10</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Minnesota</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Wisconsin</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Mississippi</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Missouri</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3"><FONT size="2">Puerto Rico</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2"> The Company currently leases most of its existing stores. The leases
provide for original lease terms that generally range from five to fifteen
years and certain leases provide for renewal options that range from five to
fifteen years, often at increased rents. Certain leases provide for scheduled
rent increases (which, in the case of fixed increases, the Company accounts for
on a straight-line basis over the noncancelable lease term) and/or for
contingent rent (based upon store sales exceeding stipulated amounts).
</FONT>
<P><FONT size="2"> The Company also leases merchandise storage space in nine locations
totaling approximately 286,000 square feet. This space is used to supplement
the warehouse facilities in the Company’s stores in proximity to these
locations. One of these locations also provides fulfillment for the Company’s
E-Service activities. See Item 1 “Business — Store
Operations — Warehousing.”
</FONT>
<P align="center"><FONT size="2">12</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P><FONT size="2"> The Company’s Corporate Office is located in 131,000 square feet of office
space in Union, New Jersey, and the Company’s Procurement Office is located in
80,000 square feet of office space in Farmingdale, New York. The Company plans
to lease additional office space at both of these locations.
</FONT>
<!-- link2 "ITEM 3 — LEGAL PROCEEDINGS" -->
<DIV align="left"><A NAME="003"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 3 — LEGAL PROCEEDINGS</B>
</FONT>
<P><FONT size="2"> There are no material pending legal proceedings, other than ordinary
routine litigation incidental to the business, to which the Company is a party.
</FONT>
<!-- link2 "ITEM 4 — SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS" -->
<DIV align="left"><A NAME="004"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 4 — SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS</B>
</FONT>
<P><FONT size="2"> There were no matters submitted to a vote of security holders through
solicitation of proxies or otherwise during the fourth quarter of the fiscal
year ended March 2, 2002.
</FONT>
<P align="center"><FONT size="2"><B>PART II</B>
</FONT>
<!-- link2 "ITEM 5 — MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS" -->
<DIV align="left"><A NAME="005"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 5 — MARKET FOR THE REGISTRANT’S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS</B>
</FONT>
<P><FONT size="2"> The following table sets forth the high and low reported closing prices of
the Company’s common stock on the NASDAQ National Market System for the periods
indicated.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="80%">
<TR valign="bottom">
<TD width="70%"> </TD>
<TD width="5%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>High</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>Low</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><I><U>Fiscal 2000 :</U></I></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1st Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">21.81</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">11.38</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">2nd Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">20.19</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">16.38</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">3rd Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">26.44</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">17.44</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">4th Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">27.06</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">20.17</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"> </FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><I><U>Fiscal 2001 :</U></I></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1st Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">31.73</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">23.19</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">2nd Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">33.03</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">28.28</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">3rd Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">33.58</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">20.38</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">4th Quarter</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">35.22</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">30.90</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"> </FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><I><U>Fiscal 2002 :</U></I></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">1st Quarter (through May 3, 2002)</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">37.17</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">31.45</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2"> The common stock is quoted through the NASDAQ National Market System under
the symbol BBBY. On May 3, 2002, there were approximately 698 shareholders of
record of the common stock (without including individual participants in
nominee security position listings). On May 3, 2002, the last reported sale
price of the common stock was $36.70.
</FONT>
<P align="center"><FONT size="2">13</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P><FONT size="2"> For the foreseeable future, the Company intends to retain all earnings for
use in the operation and expansion of its business and, accordingly, the
Company currently has no plans to pay dividends on its common stock. The
payment of any future dividends will be determined by the Board of Directors in
light of conditions then existing, including the Company’s earnings, financial
condition and requirements, business conditions and other factors. See Item 8
— Financial Statements and Supplementary Data.
</FONT>
<!-- link2 "ITEM 6 — SELECTED FINANCIAL DATA" -->
<DIV align="left"><A NAME="006"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 6 — SELECTED FINANCIAL DATA</B>
</FONT>
<P><FONT size="2"> The information required by this item is included in the registrant’s
Annual Report to Shareholders for the fiscal year ended March 2, 2002 on the
inside front cover and on page 1 and is incorporated herein by reference.
</FONT>
<!-- link2 "ITEM 7 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" -->
<DIV align="left"><A NAME="007"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 7 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</B>
</FONT>
<P><FONT size="2"> The information required by this item is included in the registrant’s
Annual Report to Shareholders for the fiscal year ended March 2, 2002 on pages
3 through 5 and is incorporated herein by reference.
</FONT>
<!-- link2 "ITEM 7A — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK" -->
<DIV align="left"><A NAME="008"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 7A — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</B>
</FONT>
<P><FONT size="2"> The Company’s exposure to market risk for changes in interest rates
relates primarily to the Company’s investment securities. The
Company is adverse to principal loss and seeks to preserve its invested funds
by limiting market risk. The Company’s
investment securities consist of fixed rate instruments. The
Company’s investments include cash and
cash equivalents of $429.5 million and investment securities of $51.9
million at a weighted average interest rate as of March 2, 2002
of 1.91% and 3.21%, respectively.
</FONT>
<!-- link2 "ITEM 8 — FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA" -->
<DIV align="left"><A NAME="009"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 8 — FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</B>
</FONT>
<P><FONT size="2"> The financial statements required by this item are included in the
registrant’s Annual Report to Shareholders for the fiscal year ended March 2,
2002 on pages 6 through 15 and are incorporated herein by reference. These
financial statements are indexed under Item 14(a)(1).
</FONT>
<!-- link2 "ITEM 9 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE" -->
<DIV align="left"><A NAME="010"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 9 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE</B>
</FONT>
<P><FONT size="2"> None.
</FONT>
<!-- link1 "PART III" -->
<DIV align="left"><A NAME="011"></A></DIV>
<P align="center"><FONT size="2"><B>PART III</B>
</FONT>
<P><FONT size="2"> The Executive Officers of the Registrant information required by Part III,
Item 10 — Directors and Executive Officers of the Registrant is included in
this document; all other information required by Part III (Item 10 — Directors
and Executive Officers of the Registrant, Item 11 — Executive Compensation,
Item 12 — Security Ownership of Certain Beneficial Owners and Management, and
Item 13 — Certain Relationships and Related Transactions) is incorporated
herein by reference from the Registrant’s definitive Proxy Statement for the
Annual Meeting of Shareholders to be held June 27, 2002 filed with the
Commission pursuant to Regulation 14A. The Compensation Report of the Board of
Directors, the Stock Price Performance Graph and the Audit Committee Report
included in such Proxy Statement shall not be deemed incorporated herein by
reference.
</FONT>
<P align="center"><FONT size="2">14</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<!-- link1 "PART IV" -->
<DIV align="left"><A NAME="012"></A></DIV>
<P align="center"><FONT size="2"><B>PART IV</B>
</FONT>
<!-- link2 "ITEM 14 — EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K" -->
<DIV align="left"><A NAME="013"></A></DIV>
<P align="left"><FONT size="2"><B>ITEM 14 — EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K</B>
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><B>(a)(1)</B></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><B>Financial Statements</B></FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">The following financial statements and reports are incorporated by
reference to pages 6 through 15 of the Company’s Annual Report to
Shareholders for the fiscal year ended March 2, 2002:</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Consolidated Balance Sheets as of March 2, 2002 and March 3, 2001.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Consolidated Statements of Earnings for the fiscal years ended March 2,
2002, March 3, 2001 and February 26, 2000.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Consolidated Statements of Shareholders’ Equity for the fiscal years ended
March 2, 2002, March 3, 2001 and February 26, 2000.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Consolidated Statements of Cash Flows for the fiscal years ended March 2,
2002, March 3, 2001 and February 26, 2000.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Notes to Consolidated Financial Statements</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Independent Auditors’ Report</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><B>(a)(2)</B></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><B>Financial Statement Schedule</B></FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Schedule 1 — The Supplementary Income Statement schedule is included in
this report.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Independent Auditors’ Consent on Schedule.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><B>(a)(3)</B></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><B>Exhibits</B></FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"> </FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">The exhibits to this Report are listed in the Exhibit Index included
elsewhere herein.</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><B>(b)</B></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">No reports on Form 8-K were filed by the Company during the fourth
quarter of the fiscal year covered by this report.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">15</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P align="center"><FONT size="2"><B>SCHEDULE 1</B>
</FONT>
<P align="center"><FONT size="2"><B>Bed Bath & Beyond Inc. and Subsidiaries<BR>
Supplementary Income Statement Schedule<BR>
(in thousands)</B>
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="5%"> </TD>
<TD width="38%"> </TD>
<TD width="5%"> </TD>
<TD width="6%"> </TD>
<TD width="1%"> </TD>
<TD width="7%"> </TD>
<TD width="5%"> </TD>
<TD width="6%"> </TD>
<TD width="1%"> </TD>
<TD width="7%"> </TD>
<TD width="5%"> </TD>
<TD width="6%"> </TD>
<TD width="1%"> </TD>
<TD width="7%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="11"><FONT size="1"><B>Fiscal Year Ended</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="11"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 3,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 26,</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2001</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2000</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B><u>Item</U></B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Advertising Costs</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">46,090</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">36,961</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">28,176</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"> </FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><HR size="4" noshade></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><HR size="4" noshade></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><HR size="4" noshade></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">16</FONT>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<!-- link1 "SIGNATURES" -->
<DIV align="left"><A NAME="014"></A></DIV>
<P align="center"><FONT size="2"><B>SIGNATURES</B>
</FONT>
<P><FONT size="2"> Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2"><B>BED BATH & BEYOND INC.</B></FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2"><B>By: <U><I>/s/ Warren Eisenberg</I></U></b><BR>
<B>Warren Eisenberg<BR>
Co-Chairman, Co-Chief Executive<BR>
Officer and Director</B></FONT></TD>
</TR>
</TABLE>
<P><FONT size="2"> Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="36%"> </TD>
<TD width="5%"> </TD>
<TD width="42%"> </TD>
<TD width="5%"> </TD>
<TD width="12%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Signature</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Capacity</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Date</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Warren Eisenberg</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Warren Eisenberg</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Co-Chairman, Co-Chief<BR>
Executive Officer and Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Leonard Feinstein</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Leonard Feinstein</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Co-Chairman, Co-Chief<BR>
Executive Officer and Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Steven H. Temares</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Steven H. Temares</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
President, Chief Operating<BR>
Officer and Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Eugene A. Castagna</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Eugene A. Castagna</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Vice President — Finance<BR>
(Principal Financial and<BR>
Accounting Officer)
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Dean S. Adler</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Dean S. Adler</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Klaus Eppler</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Klaus Eppler</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Robert S. Kaplan</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Robert S. Kaplan</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><FONT size="2"> </FONT></TD></TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"><I>/s/ Victoria A. Morrison</I><BR>
</FONT><HR size="1" noshade><FONT size="2">
<B>Victoria A. Morrison</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Director
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">May 31, 2002</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">17</FONT>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<!-- link1 "Independent Auditor’s Report on Schedule" -->
<DIV align="left"><A NAME="015"></A></DIV>
<P align="center"><FONT size="2"><B>Independent Auditor’s Report on Schedule</B>
</FONT>
<P align="left"><FONT size="2"><B>To the Board of Directors and Shareholders of Bed Bath & Beyond Inc.:</B>
</FONT>
<P><FONT size="2">Under the date of March 2, 2002, we reported on the balance sheets of Bed Bath
& Beyond Inc. and subsidiaries as of March 2, 2002 and March 3, 2001, and the
related consolidated statement of earnings, shareholders’ equity and cash flows
for each of the fiscal years in the three-year period ended March 2, 2002, as
contained in the Company’s Annual Report to Shareholders for the fiscal year
ended March 2, 2002. These consolidated financial statements and our report
thereon are incorporated by reference in the Annual Report and Form 10-K for
the fiscal year ended March 2, 2002. In connection with our audits of the
aforementioned consolidated financial statements, we also have audited the
related financial statement schedule listed in Part IV, Item 14(a)(2) of this
Form 10-K. This financial statement schedule is the responsibility of the
Company’s management. Our responsibility is to express an opinion on this
financial schedule based on our audits.
</FONT>
<P><FONT size="2">In our opinion, such financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.
</FONT>
<P><FONT size="2"><B><I>/s/ KPMG LLP</I></B><BR>
New York, New York<BR>
March 29, 2002
</FONT>
<P align="center"><FONT size="2">18</FONT>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P align="center"><FONT size="2"><B>EXHIBIT INDEX</B>
</FONT>
<P><FONT size="2">Unless otherwise indicated, exhibits are incorporated by reference to the
correspondingly numbered exhibits to the Company’s Registration Statement
on Form S-1 (Commission File No. 33-47250)
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="11%"> </TD>
<TD width="5%"> </TD>
<TD width="84%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>No.</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Restated Certificate of Incorporation</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Certificate of Amendment to the Company’s Certificate of
Incorporation (incorporated by reference to Exhibit 3 to the
Company’s Quarterly Report on Form 10-Q/A for the quarter ended
August 25, 1996)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Certificate of Amendment to the Company’s Certificate of
Incorporation (incorporated by reference to Exhibit 3.1 to the
Company’s Quarterly Report on Form 10-Q for the quarter ended August
30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Certificate of Change of Bed Bath & Beyond Inc. under Section 805-A
of the Business Corporation Law (incorporated by reference to Exhibit
3.2 to the Company’s Quarterly Report on Form 10-Q for the quarter
ended August 30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.5</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended and Restated By-laws, as amended through June 26, 1997
(incorporated by reference to Exhibit 3.3 to the Company’s Quarterly
Report on Form 10-Q for the quarter ended August 30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.6</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Certificate of Amendment of Certificate of Incorporation
(incorporated by reference to Exhibit 3.6 to the Company’s Form 10-K
for the year ended February 27, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended By-Laws of Bed Bath & Beyond Inc. (As amended through
December 17, 1998) (incorporated by reference to Exhibit 3.7 to the
Company’s Form 10-K for the year ended February 27, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.8</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended By-Laws of Bed Bath & Beyond Inc. (As amended through
September 22, 1999) (incorporated by reference to Exhibit 3.1 to the
Company’s Quarterly Report on Form 10-Q for the quarter ended August
28, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.9</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended By-Laws of the Company as amended through June 28, 2001
(incorporated by reference to Exhibit 10.1 to the Company’s Quarterly
Report on Form 10-Q for the quarter ended June 2, 2001)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">3.10</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Certificate of Amendment of Certificate of Incorporation of the
Company (incorporated by reference to Exhibit 10.1 to the Company’s
Quarterly Report on Form 10-Q for the quarter ended September 1, 2001)</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">19</FONT>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="11%"> </TD>
<TD width="5%"> </TD>
<TD width="84%"> </TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.1*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Agreement Concerning “Split Dollar” Life Insurance Plan, dated May
9, 1994, among the Company, Jay D. Waxenberg, as trustee of the
Warren Eisenberg Life Insurance Trust, Warren Eisenberg and Maxine
Eisenberg (incorporated by reference to Exhibit 10.12 to the
Company’s Form 10-K for the year ended February 27, 1994)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.2*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Agreement Concerning “Split Dollar” Life Insurance Plan, dated May
9, 1994, among the Company, Jay D. Waxenberg, as trustee of the
Leonard Joseph Feinstein Life Insurance Trust, Leonard Joseph
Feinstein and Susan Feinstein (incorporated by reference to Exhibit
10.13 to the Company’s Form 10-K for the year ended February 27,
1994)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.3*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Agreement Concerning “Split Dollar” Life Insurance Plan, dated June
16, 1995, among the Company, Jay D. Waxenberg, as trustee of the
Warren Eisenberg Life Insurance Trust, Warren Eisenberg and Maxine
Eisenberg (incorporated by reference to Exhibit 10.12 to the
Company’s Form 10-K for the year ended February 27, 1994)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.4*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Agreement Concerning “Split Dollar” Life Insurance Plan, dated June
16, 1995, among the Company, Jay D. Waxenberg, as trustee of the
Leonard Joseph Feinstein Life Insurance Trust, Leonard Joseph
Feinstein and Susan Feinstein (incorporated by reference to Exhibit
10.13 to the Company’s Form 10-K for the year ended February 27,
1994)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.5*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Stock Option Agreement between the Company and Warren Eisenberg,
dated as of August 26, 1997 (incorporated by reference to Exhibit
10.3 to the Company’s Quarterly Report on Form 10-Q for the quarter
ended August 30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.6*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Stock Option Agreement between the Company and Leonard Feinstein,
dated as of August 26, 1997 (incorporated by reference to Exhibit
10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter
ended August 30, 1997)</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">20</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="11%"> </TD>
<TD width="5%"> </TD>
<TD width="84%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>No.</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.7*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 1992 Stock Option Plan, as amended through August 26, 1997
(incorporated by reference to Exhibit 10.5 to the Company’s Quarterly
Report on Form 10-Q for the quarter ended August 30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.8*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 1996 Stock Option Plan, as amended through August 26, 1997
(incorporated by reference to Exhibit 10.6 to the Company’s Quarterly
Report on Form 10-Q for the quarter ended August 30, 1997)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.9*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Employment Agreement between the Company and Steven H. Temares
(dated as of December 1, 1994) (incorporated by reference to Exhibit
10.16 to the Company’s Form 10-K for the year ended February 28, 1998)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.10*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Form of Employment Agreement between the Company and certain
executives (including all of the executive officers of the Company
other than the Co-Chief Executive Officers, the Chief Operating
Officer and the Chief Financial Officer) (dated as of December 1,
1994) (incorporated by reference to Exhibit 10.17 to the Company’s
Form 10-K for the year ended February 28, 1998)</FONT></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.11*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 1998 Stock Option Plan (incorporated by reference to
Exhibit 10 to the Company’s Quarterly Report on
Form 10-Q for the quarter ended May 30, 1998)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.12*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Stock Option Agreement between the Company and Warren Eisenberg,
dated as of August 13, 1999 (incorporated by reference to Exhibit 10.1
to the Company’s Quarterly Report on Form 10-Q for the quarter ended
November 27, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.13*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Stock Option Agreement between the Company and Leonard Feinstein,
dated as of August 13, 1999 (incorporated by reference to Exhibit 10.2
to the Company’s Quarterly Report on Form 10-Q for the quarter ended
November 27, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.14*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Form of Standard Stock Option Agreement (incorporated by reference
to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for
the quarter ended November 27, 1999)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.15*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 2000 Stock Option Plan (incorporated by reference to
Exhibit 10 to the Company’s Quarterly Report on Form 10-Q for the
quarter ended May 27, 2000 which is incorporated by reference to
Exhibit A to the Registrant’s Proxy Statement dated May 22, 2000)</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">21</FONT>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="11%"> </TD>
<TD width="5%"> </TD>
<TD width="84%"> </TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><FONT size="1"><B>No.</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><FONT size="1"><B>Exhibit</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap align="center"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.16*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Form of Standard Stock Option Agreement (incorporated by reference
to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the
quarter ended August 26, 2000)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.17*</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 2001 Stock Option Plan (incorporated by reference to
Exhibit 10.29 to the Company’s Form 10-K for the year ended March 3,
2001)</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.18* **</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended and Restated Employment Agreement between the Company and
Warren Eisenberg, dated as of April 3, 2002.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">10.19* **</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Amended and Restated Employment Agreement between the Company and
Leonard Feinstein, dated as of April 3, 2002.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">13**</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Company’s 2001 Annual Report, certain portions of which have been
incorporated by reference herein</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">21**</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Subsidiaries of the Company<br>
Commission File No. 33-1</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2">23**</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
Independent Auditors’ Consent</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<HR size="1" width="18%" align="left" noshade>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2">*</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">This is a management contract or compensatory plan or arrangement.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2">**</FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2">Filed herewith.</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">22</FONT>
</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.18
<SEQUENCE>3
<FILENAME>y61131exv10w18.htm
<DESCRIPTION>EXHIBIT 10.18
<TEXT>
<HTML>
<HEAD>
<TITLE>A/R EMPLOYMENT AGREEMENT: EISENBERG</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"> </H5><P>
<!-- link2 "Exhibit 10.26" -->
<P align="right"><FONT size="2"><B>Exhibit 10.18</B>
</FONT>
<P align="center"><FONT size="2">AMENDED AND RESTATED EMPLOYMENT AGREEMENT
</FONT>
<P align="center"><FONT size="2">Dated as of April 3, 2002
</FONT>
<P><FONT size="2"> The parties to this agreement are Bed Bath & Beyond Inc., a New
York corporation (the
“Company”), and Warren Eisenberg (the “Executive”).
</FONT>
<P><FONT size="2"> The Company wishes to continue to employ the Executive and to
amend and restate the
existing employment agreement, dated as of June 30, 1997, between the
Company and the Executive,
which embodies the terms of such employment, and the Executive wishes to
amend and restate such
existing employment agreement and accept such continued employment on such
terms.
</FONT>
<P><FONT size="2"> Accordingly, the parties agree as follows:
</FONT>
<P><FONT size="2"> 1. Positions, Duties and Responsibilities
</FONT>
<P align="left"><FONT size="2"> (a) During the Executive’s employment under this agreement, the
Executive shall be employed as the co-chief executive officer
with Leonard Feinstein or chief executive officer of the Company
and be responsible for the general management of the affairs of
the Company. It is the intention of the parties that the
Executive be elected to and serve as a member of the board of
directors of the Company. The Executive, in carrying out his
duties under this agreement, shall report to the board of
directors of the Company.
</FONT>
<P align="left"><FONT size="2"> (b) Nothing in this agreement shall preclude the Executive from
(i) serving on the boards of directors of a reasonable number of
other corporations or the boards of a reasonable number of trade
associations and/or charitable organizations, (ii) engaging in
charitable activities and community affairs and (iii) managing
his personal investments and affairs, provided that such
activities do not materially interfere with the proper
performance of his duties and responsibilities under this
agreement.
</FONT>
<P><FONT size="2"> 2. Term of Employment. The Executive’s employment under this agreement
shall continue until the earlier of (a) June 30, 2007 (as that date
may be extended from time to time by mutual agreement of the parties)
(the “Final Date”) or (b) the termination of his employment in
accordance with this agreement.
</FONT>
<P><FONT size="2"> 3. Senior Status. Notwithstanding anything to the contrary in sections
1 and 2, at any time during the Executive’s employment under this
agreement and before the Final Date, the Executive may, at his option,
upon 90 days’ written notice given to the Company, elect to terminate
his positions, duties and responsibilities under section 1, and during
the period (the “Senior Status Period”) commencing 90 days after such
written notice is first given and continuing until the earlier of (a)
the tenth anniversary of the termination of his positions, duties and
responsibilities under section 1 or (b) the termination of the
Executive’s employment in accordance with this agreement, provide
consulting (but not line executive) services as an employee. If the
Executive shall not have exercised this option on or before the 90th
day before the Final Date the Executive shall be deemed to have
exercised this option on such date. It is the intention of the
parties that, during the Senior Status Period, the Executive shall
continue to be elected to and serve as a member of the board of
directors of the Company. The Executive, in carrying out his duties
during the Senior Status Period, shall report to the Company’s chief
executive officer or, if the Executive so elects, to the board of
directors of the Company. During the
</FONT>
<P align="center"><FONT size="2"> </FONT>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">Senior Status Period, the
Executive shall, at the request from time to time of the Company’s
chief executive officer or board of directors (whoever the Executive
then reports to), make
himself available to the Company, at times that are reasonably
convenient for him, to provide advisory services (it being
understood, however, that such services shall not require the
Executive to travel to a location more than 25 miles from his
residence from time to time or to devote more than fifty (50)
hours in any three-month period to the Company). During the
Senior Status Period, the Company shall provide the Executive an
office (at a location specified by the Executive, which need not
be where the Company’s offices are located), secretary, car and
driver, all on a basis comparable to what is currently provided
to the Executive.
</FONT>
<P><FONT size="2"> 4. Salary. During his employment under this agreement and prior to the
Senior Status Period, the Executive shall be entitled to an annual
salary (the “Executive Salary”), payable in accordance with the
regular payroll practices of the Company, of $800,000. During the
Senior Status Period, the Executive shall be entitled to an annual
salary (the “Senior Status Salary”), payable in accordance with the
regular payroll practices of the Company, of the greater of (i)
$400,000 plus the COLA Adjustment (as defined in section 5(b) below),
and (ii) fifty percent of the Executive Salary immediately prior to
the Senior Status Period. The Company may pay additional compensation
to the Executive, whether in the form of an increase in Executive
Salary or Senior Status Salary (as applicable), bonus or otherwise, if
and to the extent authorized by the board of directors of the Company,
in its sole discretion, from time to time, it being understood that
the board of directors may give consideration to increasing such
compensation at various intervals during the term of this agreement.
</FONT>
<P><FONT size="2"> 5. Employee Benefit Programs.
</FONT>
<P align="left"><FONT size="2"> (a) Generally. During the Executive’s employment under this
agreement, the Executive shall be entitled to participate in all
employee pension and welfare benefits plans and programs
available to the Company’s senior level executives or to its
employees generally, as such plans or programs may be in effect
from time to time, including, without limitation, pension, profit
sharing, savings and other retirement plans or programs, medical,
dental, hospitalization, short-term and long-term disability and
life insurance plans, accidental death and dismemberment
protection, travel accident insurance, and any other pension or
retirement plans or programs and any other employee welfare
benefit plans or programs that may be sponsored by the Company
from time to time, including any plans that supplement the
above-listed types of plans or programs, whether funded or
unfunded.
</FONT>
<P align="left"><FONT size="2"> (b) Supplemental Pension. In addition, the Executive shall be
entitled to payments in the nature of supplemental pension
payments at the rate of $200,000 (or such higher amount resulting
from the annual COLA Adjustment described below) per year,
payable in accordance with the regular payroll practices of the
Company, for the period following the termination of his
employment until the death of the survivor of the Executive and
his current spouse, such payments, however, to begin only
following the later of: (i) the termination of any salary
payments (including, without limitation, any salary continuation
payments contemplated under section 7(d)(ii), if applicable); and
(ii) the tenth anniversary of the Final Date if the Executive
receives a lump sum payment pursuant to section 7(d)(ii) or
section 8(b). Such supplemental pension payments shall be
payable upon the termination of the Executive’s employment under
all circumstances (including, but not limited to, a termination
pursuant to section 7(a)) other than termination by the Company
for Cause. The amount of such supplemental pension payments
shall be increased (the “COLA Adjustment”) during each year the
supplemental pension payments are payable by an amount which
reflects any increase in the
</FONT>
<P align="center"><FONT size="2">2</FONT>
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">cost of living on the immediately
preceding June 30th over the cost of living on June 30, 2000,
using as a basis for such increase the Consumer Price Index for
all Urban Consumers (CPI-U) for New York, Northern New
Jersey-Long Island, as published by the U.S. Department of Labor
(the “Index”) or, in the event such Index is no longer published,
such other index as is determined in good faith to be comparable
by the board of directors of the Company. The COLA Adjustment
shall be made each July 1st and shall remain applicable until the
next June 30th. The Executive acknowledges that the Company’s
obligation under section 5(b) is an unfunded, unsecured promise
to pay certain amounts to the Executive in the future. The
amounts payable under section 5(b) shall be paid out of the
Company’s general assets and shall be subject to the risk of the
Company’s creditors. In no event shall the Executive’s rights
under section 5(b) be greater than the right of any unsecured
general creditor of the Company.
</FONT>
<P><FONT size="2"> 6. Reimbursement of Business and Other Expenses. The Executive is
authorized to incur reasonable expenses in carrying out his duties and
responsibilities under this agreement, and the Company shall promptly
reimburse him for all business expenses incurred in carrying out the
business of the Company, subject to documentation in accordance with
the Company’s policies.
</FONT>
<P><FONT size="2"> 7. Termination of Employment
</FONT>
<P align="left"><FONT size="2"> (a) In the event the Executive’s employment terminates due to
his death, his estate or his beneficiaries, as the case may be,
shall be entitled to his salary for a period of one year
following his death, any amount owing but not yet paid under
section 6 and other or additional benefits owing but not yet paid
in accordance with applicable plans and programs of the Company.
</FONT>
<P align="left"><FONT size="2"> (b) In the event the Executive’s employment terminates due to
his inability substantially to perform his duties and
responsibilities under this agreement for a period of 180
consecutive days, he shall be entitled to his salary for a period
of one year following the date of termination (less any amounts
received under the Company’s benefit plans as a result of such
disability) and any amount owing but not yet paid under section
6. In no event shall a termination of the Executive’s employment
under this section 7(b) occur, unless the party terminating the
Executive’s employment gives written notice to the other party in
accordance with this agreement.
</FONT>
<P align="left"><FONT size="2"> (c) (i) As used in this agreement, the term “Cause”
means (A) the Executive is convicted of a felony involving
moral turpitude or (B) the Executive is guilty of willful
gross neglect or willful gross misconduct in carrying out
his duties under this agreement, resulting, in either case,
in material economic harm to the Company, unless the
Executive believed in good faith that such act or nonact was
in the best interests of the Company.
</FONT>
<P align="left"><FONT size="2"> (ii) The Company may terminate the Executive’s employment
under this agreement for Cause. A termination for Cause
shall not take effect, however, unless the provisions of
this paragraph (c)(ii) are complied with. The Executive
shall be given written notice by the board of directors of
the Company of the intention to terminate his employment
for Cause, such notice to state in detail the particular
act or acts or failure or failures to act that constitute
the grounds on which the proposed termination for Cause is
based. The Executive shall have 10 days after the date
that such written notice has been given in which to cure
such conduct, to the extent a cure is possible. If he
fails to cure such conduct, his employment shall be
terminated for Cause.
</FONT>
<P align="left"><FONT size="2"> (iii) In the event the Company terminates the Executive’s
employment for Cause, he shall be entitled to his salary
through the date of the termination of his
</FONT>
<P align="center"><FONT size="2">3</FONT>
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<P><FONT size="2">employment, any
amounts owing but not yet paid under section 6 and other
or additional benefits in accordance with applicable plans
or programs of the Company.
</FONT>
<P align="left"><FONT size="2"> (d) (i) As used in this agreement, the term
“Constructive Termination Without
Cause” means a termination of the Executive’s employment
at his initiative following the occurrence, without the
Executive’s prior written consent, of one or more of the
following events (except in consequence of a prior
termination):
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
<TD width="9%"></TD>
<TD width="91%"></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (A) a reduction in the Executive’s salary or a
material reduction of any employee benefit or
perquisite enjoyed by him (other than as part of any
across-the-board action applicable to all executive
officers of the Company);</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (B) the failure to elect or reelect the Executive to
any of the officer or director positions
referred to in section 1(a) or removal of him from
any of such positions;</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (C) a material diminution in the Executive’s duties
or the assignment to the Executive of duties
materially inconsistent with his duties or that
materially impair the Executive’s ability to
function, prior to the Senior Status Period, as the
co-chief executive officer or chief executive
officer of the Company;</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (D) the relocation of the Company’s principal
office, or the Executive’s own office location as
assigned to him by the Company, to a location more
than twenty-five (25) miles from Union, New Jersey.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"> (ii) In the event the Company terminates the Executive’s
employment without Cause, other than pursuant to section
7(a) or (b), or in the event there is a Constructive
Termination Without Cause, the Executive shall be entitled
to his salary through the date of termination of
employment, his Executive Salary through the Final Date
and thereafter his Senior Status Salary through the tenth
anniversary of the Final Date (provided that, at the
Executive’s option, exercised by written notice given to
the Company, the Company shall pay him the present value
of such salary continuation payments in a lump sum (using
as the discount rate the Applicable Federal Rate for
short-term Treasury obligations as published by the
Internal Revenue Service for the month in which such
termination occurs)), and any amount owing but not yet
paid under section 6.
</FONT>
<P align="left"><FONT size="2"> (e) Except with regard to a voluntary termination described in
section 8(b), in the event of a termination of employment by the
Executive on his own initiative other than a termination
otherwise provided for in this section 7, the Executive shall
have the same entitlements as provided in section 7(c)(iii) for a
termination for Cause.
</FONT>
<P align="left"><FONT size="2"> (f) In the event of a termination of employment other than
pursuant to section 7(c), the Executive (and his current spouse,
to the extent applicable) shall be entitled to continue to
participate at the Company’s expense in medical, dental,
hospitalization and life insurance coverage and in all other
employee plans and programs in which he or his family was
participating on the date of termination of his employment and
other or additional benefits in accordance with applicable plans
and programs of the Company until the earlier of (A) the death of
the survivor of the Executive and his current spouse or (B) the
date, or dates, the Executive receives equivalent coverage and
benefits under the plans and programs of a subsequent employer
(such coverages and benefits to be determined on a
coverage-by-coverage, or benefit-by-benefit, basis). If the
Executive is precluded from continuing his participation in any
benefit plan or program referred to in the immediately preceding
sentence, he shall be provided the after-tax economic equivalent
of the benefits provided under the plan or program in which he is
unable to participate. The economic equivalent of any benefit
foregone shall be deemed to be the cost
</FONT>
<P align="center"><FONT size="2">4</FONT>
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<P><FONT size="2">that would be incurred by
the Executive in obtaining such benefit himself on an individual
basis from a provider of insurance coverage acceptable to the
Executive. The payment of such after-tax economic equivalent
shall be made quarterly in advance. In addition, to the extent
the Executive (or his current spouse, if applicable) incurs tax
that the Executive would not have incurred as
an active employee as a result of the aforementioned coverage or
the benefits provided thereunder, the Executive (or his current
spouse, if applicable) shall receive from the Company an
additional payment in the amount necessary so that the Executive
(or his current spouse, if applicable) will have no additional
cost for receiving such items or any additional payment.
</FONT>
<P align="left"><FONT size="2"> (g) In the event of any termination of employment under this
section 7, the Executive shall be under no obligation to seek
other employment and there shall be no offset against amounts due
the Executive under this agreement on account of any remuneration
attributable to any subsequent employment that he may obtain,
except as specifically provided in this section 7. Except as set
forth in this agreement, the Company’s obligation to make the
payments provided for in this Agreement and otherwise to perform
its obligations hereunder shall not be affected by any
circumstances, including without limitation, set-off,
counterclaim, recoupment, defense or other claim, right or action
which the Company may have against the Executive or others.
</FONT>
<P><FONT size="2"> 8. Change in Control
</FONT>
<P align="left"><FONT size="2"> (a) As used in this agreement, the term “Change in Control”
means the occurrence of any one of the following events:
</FONT>
<P align="left"><FONT size="2"> (i) any “person,” as such term is used in sections
3(a)(9) and 13(d) of the Securities Exchange Act of 1934,
becomes a “beneficial owner,” as such term is used in Rule
13d-3 under that act, of 30% or more of the outstanding
common stock of the Company, excluding a person that is an
affiliate (as such term is used under that act) of the
Company on the date of this agreement, or any affiliate of
any such person;
</FONT>
<P align="left"><FONT size="2"> (ii) the majority of the board of directors of the Company
consists of individuals other than Incumbent Directors,
which term means the members of the board of directors of
the Company on the date of this agreement; provided that
any person becoming a director subsequent to such date
whose election or nomination for election was supported by
two-thirds of the directors who then comprised the
Incumbent Directors shall be considered an Incumbent
Director;
</FONT>
<P align="left"><FONT size="2"> (iii) the Company adopts any plan of liquidation providing
for the distribution of all or substantially all its
assets;
</FONT>
<P align="left"><FONT size="2"> (iv) all or substantially all the assets or business of
the Company are disposed of pursuant to a merger,
consolidation or other transaction (unless the
shareholders of the Company immediately prior to such
merger, consolidation or other transaction beneficially
own, directly or indirectly, in substantially the same
proportion as they own the common stock of the Company,
all the common stock or other ownership interests of the
entity or entities, if any, that succeed to the business
of the Company); or
</FONT>
<P align="left"><FONT size="2"> (v) the Company combines with another company and is the
surviving corporation, but, immediately after the
combination, the shareholders of the Company immediately
prior to the combination hold, directly or indirectly, 50%
or less of the common stock or other ownership interests
of the combined company (there being excluded from the
number of shares held by such shareholders, but not from
the common stock or other ownership
</FONT>
<P align="center"><FONT size="2">5</FONT>
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<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">interests of the
combined company, any shares other ownership interests
received by affiliates of such other company in exchange
for stock of such other company).
</FONT>
<P align="left"><FONT size="2"> (b) Following a Change in Control, the Executive may, at his
option, upon 90 days’ written notice given to the Company,
terminate his employment under this agreement and, in lieu of any
other amounts otherwise payable to him under section 7, (i) he
will be entitled to receive, in a single lump sum on or before
the 90th day after such written notice is given, an amount equal
to (A) the product of (1) the Executive Salary then in effect and
(2) three, if the written notice is given before the Senior
Status Period, or (B) the product of (1) one half of his Senior
Status Salary and (2) the number of years (including fractions),
if any, remaining in the Senior Status Period on the 90th day
after such written notice is given, if the written notice is
given during the Senior Status Period, and (ii) pursuant to
section 7(f), he shall be afforded continued participation in all
medical, dental, hospitalization and life insurance coverage and
in other employee benefit plans or programs in which he was
participating on the date of the termination of his employment.
</FONT>
<P align="left"><FONT size="2"> (c) In the event the amount provided to the Executive under
section 8(b) (the “Payment”) is determined to constitute a
“parachute payment,” as such term is defined in section
280G(b)(2) of the Internal Revenue Code of 1986, as amended (the
“Code”), notwithstanding anything to the contrary in this
agreement, the Executive shall be entitled to receive an
additional payment (a “Gross-Up Payment”) in an amount such that
after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest
and penalties imposed with respect thereto) and any excise tax
imposed by section 4999 of the Code (and any interest and
penalties imposed with respect thereto) (collectively, “Excise
Tax”) imposed upon the Gross-Up Payment, the Executive retains an
amount of the Gross-Up Payment equal to the Excise Tax imposed
upon the Payment. The determination of whether the Payment
constitutes a “parachute payment” and, if so, the amount to be
paid to the Executive and the time of payment pursuant to this
section 8(c) shall be made by an independent auditor (the
“Auditor”) jointly selected by the Company and the Executive and
paid by the Company. The Auditor shall be a nationally
recognized United States public accounting firm, which has not,
during the two years preceding the date of its selection, acted
in any way on behalf of the Company or any affiliate of the
Company. If the Executive and the Company cannot agree on the
firm to serve as the Auditor, the Executive and Company shall
each select one accounting firm and those two firms shall jointly
select the accounting firm to serve as the Auditor.
</FONT>
<P><FONT size="2"> 9. Indemnification
</FONT>
<P align="left"><FONT size="2"> (a) The Company agrees that, if the Executive is made a party, or
is threatened to be made a party, to any action, suit or
proceeding, whether civil, criminal, administrative or
investigation (a “Proceeding”), by reason of the fact that he is
or was a director, officer or employee of the Company or is or
was serving at the request of the Company as a director, officer,
member, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, including service with
respect to employee benefit plans, whether or not the basis of
such Proceeding is the Executive’s alleged action in an official
capacity while serving as director, officer, member, employee or
agent, the Executive shall be indemnified and held harmless by
the Company to the fullest extent permitted or authorized by the
Company’s certificate of incorporation or bylaws or, if greater,
by the laws of the state of New York, against all cost, expense,
liability and loss (including, without limitation, attorneys’
fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid or to be paid in settlement) reasonably
</FONT>
<P align="center"><FONT size="2">6</FONT>
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<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">incurred or
suffered by the Executive in connection therewith, and such
indemnification shall continue as to the Executive even if he has
ceased to be a director, member, employee or agent of the Company
or other entity and shall inure to the benefit of the Executive’s
heirs, executors and administrators. The Company shall advance
to the Executive all reasonable costs and expenses incurred by
him in connection with a Proceeding within 20 days after receipt
by the Company of a written request for such advance. Such
request shall include an undertaking by the Executive to repay the
amount of such advance if it shall ultimately be determined that
he is not entitled to be indemnified against such costs and
expenses.
</FONT>
<P align="left"><FONT size="2"> (b) Neither the failure of the Company (including its board or
directors, independent legal counsel or shareholders) to have
made a determination prior to the commencement of any
proceeding concerning payment of amounts claimed by the Executive
under section 9(a) that indemnification of the Executive is
proper because he has met the applicable standard of conduct, nor
a determination by the Company (including its board of directors,
independent legal counsel or shareholders) that the Executive has
not met such applicable standard of conduct, shall create a
presumption that the Executive has not met the applicable
standard of conduct.
</FONT>
<P align="left"><FONT size="2"> (c) The Company agrees to continue and maintain a director’s and
officers’ liability insurance policy covering the Executive to
the extent the Company provides such coverage for its other
executive officers.
</FONT>
<P><FONT size="2"> 10. Confidentiality. The Executive shall at all times during the period
of his employment and thereafter hold in confidence any and all
Confidential Information (as defined below) that may have come or may
come into his possession or within his knowledge concerning the
products, services, processes, businesses, suppliers, customers and
clients of the Company or its controlled affiliates. The Executive
agrees that neither he nor any person or enterprise controlled by him
will for any reason directly or indirectly, for himself or any other
person, use or disclose any trade secrets, proprietary or confidential
information, inventions, manufacturing or industrial processes or
procedures, patents, trademarks, trade names, customer lists, service
marks, service names, copyrights, applications for any of the
foregoing or licenses or other rights in respect thereof
(collectively, “Confidential Information”), owned or used by, or
licensed to, the Company or any of its controlled affiliates, provided
that the Executive may disclose Confidential Information that has
become generally available to the public other than as a result of a
breach of this agreement by the Executive or pursuant to an order of a
court of competent jurisdiction or of a governmental agency,
department or commission. Upon termination of his employment under
this agreement, the Executive shall promptly surrender to the Company
all documents he believes contain Confidential Information and that
are within his possession or control, other than documents to which
the Executive is or was a party or that relate to the Executive or the
basis, or purported basis, on which his employment was terminated.
</FONT>
<P><FONT size="2"> 11. Noncompetition and Nonsolicitation
</FONT>
<P align="left"><FONT size="2"> (a) The Executive agrees that from the date of this agreement and
subsequent to the termination of his employment under this
agreement and continuing for the period (the “Non-Compete
Period”) after termination of employment under section 7 (but not
under section 8) in respect of which salary continuation payments
would be required to be made under section 7(d) (regardless of
whether termination of employment occurs pursuant to section
7(d)), neither the Executive nor any person or enterprise
controlled by him will become a shareholder, lender, director,
officer, agent or employee of a corporation or member of or
lender to a partnership, engage as a sole proprietor in any
business, act as a consultant to any of the foregoing or
</FONT>
<P align="center"><FONT size="2">7</FONT>
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<P><FONT size="2">otherwise engage directly or indirectly in any business that is
in competition with the business then conducted by the Company or
any of its controlled affiliates in any state in the United
States or any other country in which the Company or any of its
controlled affiliates has engaged in such business during the
Executive’s employment under this agreement; provided, however,
that the foregoing shall not prohibit the Executive from owning
less than two percent of the outstanding securities of any class
of capital stock of a corporation the securities of which are
regularly traded or quoted on a national securities exchange or
on an inter-dealer quotation system.
</FONT>
<P align="left"><FONT size="2"> (b) The Executive agrees that, during the Non-Compete Period,
neither he nor any person or enterprise controlled by him will
(i) solicit for employment any person who was employed by the
Company or any of its controlled affiliates at any time within
one year prior to the time of the act of solicitation or (ii) in
any way cause, influence or participate
in the solicitation for employment of any such individual by
anyone else.
</FONT>
<P align="left"><FONT size="2"> (c) The Executive acknowledges that there is no adequate remedy
at law for a breach of this section 11 and that, in the event of
such a breach or attempted breach, the Company shall be entitled
to injunctive or other equitable relief to prevent any such
breach, attempted breach or continuing breach, without prejudice
to any other remedies for damages or otherwise.
</FONT>
<P><FONT size="2"> 12. Assignability; Binding Nature. This agreement shall inure to the
benefit of the parties and their respective successors, heirs (in the
case of the Executive) and assigns. No rights or obligations of the
Company under this agreement may be assigned or transferred by the
Company, except pursuant to a merger or consolidation, or the sale or
liquidation of all or substantially all the assets of the Company,
provided that, in the case of such a sale or liquidation, the assignee
or transferee assumes in writing the obligation to perform this
agreement (it being understood, however, that no such assignment or
transfer shall relieve the Company of its liabilities or obligations
under this agreement).
</FONT>
<P><FONT size="2"> 13. Amendment or Waiver. This agreement may not be amended or waived,
except by an instrument in writing signed by the party to be charged.
</FONT>
<P><FONT size="2"> 14. Severability. If any provision of this agreement is invalid or
unenforceable, the remaining provisions of this agreement shall remain
in effect.
</FONT>
<P><FONT size="2"> 15. Governing Law. This agreement shall be governed by and construed and
interpreted in accordance with the law of the state of New York as
applied to agreements among New York residents entered into and to be
performed entirely within New York.
</FONT>
<P><FONT size="2"> 16. Disputes. Except as otherwise expressly provided in this agreement,
any dispute arising under or in connection with this agreement shall,
at the election of the Executive, be resolved by binding arbitration
to be held in New York City in accordance with the rules of the
American Arbitration Association. Judgment upon the arbitrator’s
award may be entered in any court having jurisdiction. Costs of any
arbitration or litigation, including, without limitation, attorneys’
fees of both parties, shall be borne by the Company and advanced to
the Executive as appropriate from time to time, provided that, if the
arbitrator or judge, as the case may be, determines that the claims or
defenses of the Executive were without any reasonable basis, each
party shall bear his or its own costs.
</FONT>
<P><FONT size="2"> 17. Notices. All notices and other communications under this agreement
shall be in writing and may be given by any of the following methods:
(a) personal delivery; (b) facsimile transmission; (c) registered or
certified mail, postage prepaid, return receipt requested; or (d)
overnight delivery service. Notices shall be sent to the appropriate
party at its or his address or
</FONT>
<P align="center"><FONT size="2">8</FONT>
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<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">facsimile number given below (or at
such other address or facsimile number for that party as specified by
notice given under this section 17):
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">if to the Company, to it at:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">650 Liberty Avenue<BR>
Union, New Jersey 07083<BR>
Fax: 908-688-8385</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">if to the Executive, to him at:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">[***]</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">All such notices and communications shall be deemed given and
received upon (a) actual receipt by the addressee, (b) actual
delivery to the appropriate address or (c) in the case of a
facsimile transmission, upon transmission by the sender and
issuance by the transmitting
machine of a confirmation slip confirming that the number of
pages constituting the notice have been transmitted without
error. In the case of notices sent by facsimile transmission,
the sender shall contemporaneously mail a copy of the notice to
the addressee at the address provided above; however, such
mailing shall in no way alter the time at which the facsimile
notice is deemed given and received.
</FONT>
<P><FONT size="2"> 18. Headings. The section headings in this agreement are for convenience
only and shall not affect
the meaning or construction of any provision of this
agreement.
</FONT>
<P><FONT size="2"> 19. Counterparts. This agreement may be executed in counterparts.
</FONT>
<P><FONT size="2"> 20. Entire Agreement. This agreement contains the entire agreement and
understanding of the parties concerning its subject matter and
supersedes all prior agreements and understandings with respect to
that subject matter. Nothing in this agreement is intended to
</FONT>
<P align="center"><FONT size="2">9</FONT>
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<P><FONT size="2">or
shall affect the rights or obligations of the parties under any
agreement relating to the maintenance of life insurance or stock
options.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
<TD width="15%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="72%"> </TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3" valign="top" align="left"><FONT size="2">BED BATH & BEYOND INC.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
By:
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">/s/Leonard Feinstein</FONT></TD>
</TR>
<TR>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Name: Leonard Feinstein<BR>
Title: Co-Chief Executive Officer</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3" valign="top" align="left"><FONT size="2">THE EXECUTIVE:</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">/s/Warren Eisenberg</FONT></TD>
</TR>
<TR>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Warren Eisenberg</FONT></TD>
</TR>
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<DOCUMENT>
<TYPE>EX-10.19
<SEQUENCE>4
<FILENAME>y61131exv10w19.htm
<DESCRIPTION>EXHIBIT 10.19
<TEXT>
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<HEAD>
<TITLE>A/R EMPLOYMENT AGREEMENT: FEINSTEIN</TITLE>
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<P align="right"><FONT size="2"><B>Exhibit 10.19</B>
</FONT>
<P align="center"><FONT size="2">AMENDED AND RESTATED EMPLOYMENT AGREEMENT
</FONT>
<P align="center"><FONT size="2">Dated as of April 3, 2002
</FONT>
<P><FONT size="2"> The parties to this agreement are Bed Bath & Beyond Inc., a New York
corporation (the “Company”), and Leonard Feinstein (the “Executive”).
</FONT>
<P><FONT size="2"> The Company wishes to continue to employ the Executive and to amend and
restate the existing employment agreement, dated as of June 30, 1997, between
the Company and the Executive, which embodies the terms of such employment, and
the Executive wishes to amend and restate such existing employment agreement
and accept such continued employment on such terms.
</FONT>
<P><FONT size="2"> Accordingly, the parties agree as follows:
</FONT>
<P><FONT size="2"> 1. Positions, Duties and Responsibilities
</FONT>
<P align="left"><FONT size="2"> (a) During the Executive’s employment under this agreement, the Executive
shall be employed as the co-chief executive officer with Leonard Feinstein
or chief executive officer of the Company and be responsible for the
general management of the affairs of the Company. It is the intention of
the parties that the Executive be elected to and serve as a member of the
board of directors of the Company. The Executive, in carrying out his
duties under this agreement, shall report to the board of directors of the
Company.
</FONT>
<P align="left"><FONT size="2"> (b) Nothing in this agreement shall preclude the Executive from (i)
serving on the boards of directors of a reasonable number of other
corporations or the boards of a reasonable number of trade associations
and/or charitable organizations, (ii) engaging in charitable activities
and community affairs and (iii) managing his personal investments and
affairs, provided that such activities do not materially interfere with
the proper performance of his duties and responsibilities under this
agreement.
</FONT>
<P><FONT size="2"> 2. Term of Employment. The Executive’s employment under this agreement shall
continue until the earlier of (a)
June 30, 2007 (as that date may be extended from time to time by mutual
agreement of the parties) (the “Final Date”) or (b) the termination of his
employment in accordance with this agreement.
</FONT>
<P><FONT size="2"> 3. Senior Status. Notwithstanding anything to the contrary in sections 1
and 2, at any time during the
Executive’s employment under this agreement and before the Final Date, the
Executive may, at his option, upon 90 days’ written notice given to the
Company, elect to terminate his positions, duties and responsibilities
under section 1, and during the period (the “Senior Status Period”)
commencing 90 days after such written notice is first given and continuing
until the earlier of (a) the tenth anniversary of the termination of his
positions, duties and responsibilities under section 1 or (b) the
termination of the Executive’s employment in accordance with this
agreement, provide consulting (but not line executive) services as an
employee. If the Executive shall not have exercised this option on or
before the 90th day before the Final Date the Executive shall be deemed to
have exercised this option on such date. It is the intention of the
parties that, during the Senior Status Period, the Executive shall
continue to be
</FONT>
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<P><FONT size="2">elected to and serve as a member of the board of directors
of the Company. The Executive, in carrying out his duties during the
Senior Status Period, shall report to the Company’s chief executive
officer or, if the Executive so elects, to the board of directors of the
Company. During the Senior Status Period, the Executive shall, at the
request from time to time of the Company’s chief executive officer or
board of directors (whoever the Executive then reports to), make himself
available to the Company, at times that are reasonably convenient for him,
to provide advisory services (it being understood, however, that such
services shall not require the Executive to
travel to a location more than 25 miles from his residence from time to
time or to devote more than fifty (50) hours in any three-month period to
the Company). During the Senior Status Period, the Company shall provide
the Executive an office (at a location specified by the Executive, which
need not be where the Company’s offices are located), secretary, car and
driver, all on a basis comparable to what is currently provided to the
Executive.
</FONT>
<P><FONT size="2"> 4. Salary. During his employment under this agreement and prior to the Senior
Status Period, the Executive
shall be entitled to an annual salary (the “Executive Salary”), payable in
accordance with the regular payroll practices of the Company, of $800,000.
During the Senior Status Period, the Executive shall be entitled to an
annual salary (the “Senior Status Salary”), payable in accordance with the
regular payroll practices of the Company, of the greater of (i) $400,000
plus the COLA Adjustment (as defined in section 5(b) below), and (ii)
fifty percent of the Executive Salary immediately prior to the Senior
Status Period. The Company may pay additional compensation to the
Executive, whether in the form of an increase in Executive Salary or
Senior Status Salary (as applicable), bonus or otherwise, if and to the
extent authorized by the board of directors of the Company, in its sole
discretion, from time to time, it being understood that the board of
directors may give consideration to increasing such compensation at
various intervals during the term of this agreement.
</FONT>
<P><FONT size="2"> 5. Employee Benefit Programs.
</FONT>
<P align="left"><FONT size="2"> (a) Generally. During the Executive’s employment under this agreement,
the Executive shall be entitled to participate in all employee pension and
welfare benefits plans and programs available to the Company’s senior
level executives or to its employees generally, as such plans or programs
may be in effect from time to time, including, without limitation,
pension, profit sharing, savings and other retirement plans or programs,
medical, dental, hospitalization, short-term and long-term disability and
life insurance plans, accidental death and dismemberment protection,
travel accident insurance, and any other pension or retirement plans or
programs and any other employee welfare benefit plans or programs that may
be sponsored by the Company from time to time, including any plans that
supplement the above-listed types of plans or programs, whether funded or
unfunded.
</FONT>
<P align="left"><FONT size="2"> (b) Supplemental Pension. In addition, the Executive shall be entitled to
payments in the nature of supplemental pension payments at the rate of
$200,000 (or such higher amount resulting from the annual COLA Adjustment
described below) per year, payable in accordance with the regular payroll
practices of the Company, for the period following the termination of his
employment until the death of the survivor of the Executive and his
current spouse, such payments, however, to begin only following the later
of: (i) the termination of any salary payments (including, without
limitation, any salary continuation payments contemplated under section
7(d)(ii), if applicable); and (ii) the tenth anniversary of the Final Date
if the Executive receives a lump sum payment pursuant to section 7(d)(ii)
or section 8(b). Such supplemental pension payments shall be payable upon
the termination of the Executive’s employment under all circumstances
(including, but not limited to, a termination pursuant to
</FONT>
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<P><FONT size="2">section 7(a))
other than termination by the Company for Cause. The amount of such
supplemental pension payments shall be increased (the “COLA Adjustment”)
during each year the supplemental pension payments are payable by an
amount which reflects any increase in the cost of living on the
immediately preceding June 30th over the cost of living on June 30, 2000,
using as a basis for such increase the Consumer Price Index for all Urban
Consumers (CPI-U) for New York, Northern New Jersey-Long Island, as
published by the U.S. Department of Labor (the “Index”) or, in the event
such Index is no longer published, such other index as is determined in
good faith to be comparable by the board of directors of the Company. The
COLA Adjustment shall be made each July 1st and shall remain applicable
until the next June 30th. The Executive acknowledges that the Company’s
obligation under section 5(b) is an unfunded, unsecured promise to pay
certain amounts to the Executive in the future. The amounts payable under
section 5(b) shall be paid out of the Company’s general assets and shall
be subject to the risk of the Company’s creditors. In no event shall the
Executive’s rights under section 5(b) be greater than the right of any
unsecured general creditor of the Company.
</FONT>
<P><FONT size="2"> 6. Reimbursement of Business and Other Expenses. The Executive is authorized
to incur reasonable
expenses in carrying out his duties and responsibilities under this
agreement, and the Company shall promptly reimburse him for all business
expenses incurred in carrying out the business of the Company, subject to
documentation in accordance with the Company’s policies.
</FONT>
<P><FONT size="2"> 7. Termination of Employment
</FONT>
<P align="left"><FONT size="2"> (a) In the event the Executive’s employment terminates due to his death,
his estate or his beneficiaries, as the case may be, shall be entitled to
his salary for a period of one year following his death, any amount owing
but not yet paid under section 6 and other or additional benefits owing
but not yet paid in accordance with applicable plans and programs of the
Company.
</FONT>
<P align="left"><FONT size="2"> (b) In the event the Executive’s employment terminates due to his
inability substantially to perform his duties and responsibilities under
this agreement for a period of 180 consecutive days, he shall be entitled
to his salary for a period of one year following the date of termination
(less any amounts received under the Company’s benefit plans as a result
of such disability) and any amount owing but not yet paid under section 6.
In no event shall a termination of the Executive’s employment under this
section 7(b) occur, unless the party terminating the Executive’s
employment gives written notice to the other party in accordance with this
agreement.
</FONT>
<P align="left"><FONT size="2"> (c) (i) As used in this agreement, the term “Cause” means (A) the
Executive is convicted of a felony involving moral turpitude or (B)
the Executive is guilty of willful gross neglect or willful gross
misconduct in carrying out his duties under this agreement,
resulting, in either case, in material economic harm to the Company,
unless the Executive believed in good faith that such act or nonact
was in the best interests of the Company.
</FONT>
<P align="left"><FONT size="2"> (ii) The Company may terminate the Executive’s employment under this
agreement for Cause.
A termination for Cause shall not take effect, however, unless
the provisions of this paragraph (c)(ii) are complied with. The
Executive shall be given written notice by the board of directors of
the Company of the intention to terminate his employment for Cause,
such notice to state in detail the particular act or acts or failure
or failures to act that constitute the grounds on which the proposed
termination for Cause is based. The Executive shall have 10 days
after the date that such written notice has been given in which to
cure such
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<P><FONT size="2">conduct, to the extent a cure is possible. If he fails to
cure such conduct, his employment shall be terminated for Cause.
</FONT>
<P align="left"><FONT size="2"> (iii) In the event the Company terminates the Executive’s employment
for Cause, he shall be
entitled to his salary through the date of the termination of his
employment, any amounts
owing but not yet paid under section 6 and other or additional
benefits in accordance with
applicable plans or programs of the Company.
</FONT>
<P align="left"><FONT size="2"> (d) (i) As used in this agreement, the term “Constructive
Termination Without Cause” means a
termination of the Executive’s employment at his initiative
following the occurrence, without the Executive’s prior written
consent, of one or more of the following events (except in
consequence of a prior termination):
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
<TD width="9%"></TD>
<TD width="91%"></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (A) a reduction in the Executive’s salary or a material
reduction of any employee benefit or perquisite enjoyed by him
(other than as part of any across-the-board action applicable
to all executive officers of the Company);</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (B) the failure to elect or reelect the Executive to any of
the officer or director positions referred to in section 1(a)
or removal of him from any of such positions;</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (C) a material diminution in the Executive’s duties or the
assignment to the Executive
of duties materially inconsistent with his duties or that
materially impair the Executive’s ability to function, prior
to the Senior Status Period, as the co-chief executive
officer or chief executive officer of the Company;</FONT></TD>
</TR>
<TR>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR valign="top">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> (D) the relocation of the Company’s principal office, or the
Executive’s own office
location as assigned to him by the Company, to a location
more than twenty-five (25) miles from Union, New Jersey.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2"> (ii) In the event the Company terminates the Executive’s employment
without Cause, other than pursuant to section 7(a) or (b), or in the
event there is a Constructive Termination Without Cause, the
Executive shall be entitled to his salary through the date of
termination of employment, his Executive Salary through the Final
Date and thereafter his Senior Status Salary through the tenth
anniversary of the Final Date (provided that, at the Executive’s
option, exercised by written notice given to the Company, the
Company shall pay him the present value of such salary continuation
payments in a lump sum (using as the discount rate the Applicable
Federal Rate for short-term Treasury obligations as published by the
Internal Revenue Service for the month in which such termination
occurs)), and any amount owing but not yet paid under section 6.
</FONT>
<P align="left"><FONT size="2"> (e) Except with regard to a voluntary termination described in section
8(b), in the event of a termination of employment by the Executive on his
own initiative other than a termination otherwise provided for in this
section 7, the Executive shall have the same entitlements as provided in
section 7(c)(iii) for a termination for Cause.
</FONT>
<P align="left"><FONT size="2"> (f) In the event of a termination of employment other than pursuant to
section 7(c), the Executive (and his current spouse, to the extent
applicable) shall be entitled to continue to participate at the Company’s
expense in medical, dental, hospitalization and life insurance coverage
and in all other employee plans and programs in which he or his family was
participating on the date of termination of his employment and other or
additional benefits in accordance with applicable plans and programs of
the Company until the earlier of (A) the death of the survivor of the
Executive and his current spouse or (B) the date, or dates, the Executive
receives equivalent coverage and benefits under the plans and programs of
a subsequent employer (such coverages and benefits to be determined on a
coverage-by-coverage, or benefit-
</FONT>
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<P><FONT size="2">by-benefit, basis). If the Executive is
precluded from continuing his participation in any benefit plan or program
referred to in the immediately preceding sentence, he shall be provided
the after-tax economic equivalent of the benefits provided under the plan
or program in which he is unable to participate. The economic equivalent
of any benefit foregone shall be deemed to be the cost that would be
incurred by the Executive in obtaining such benefit himself on an
individual basis from a provider of insurance coverage acceptable to the
Executive. The payment of such after-tax economic equivalent shall be
made quarterly in advance. In addition, to the extent the Executive (or
his current spouse, if applicable) incurs tax that the Executive would not
have incurred as an active employee as a result of the aforementioned
coverage or the benefits provided thereunder, the Executive (or his
current spouse, if applicable) shall receive from the Company an
additional payment in the amount necessary so that the Executive (or his
current spouse, if applicable) will have no additional cost for receiving
such items or any additional payment.
</FONT>
<P align="left"><FONT size="2"> (g) In the event of any termination of employment under this section 7,
the Executive shall be under no obligation to seek other employment and
there shall be no offset against amounts due the Executive under this
agreement on account of any remuneration attributable to any subsequent
employment that he may obtain, except as specifically provided in this
section 7. Except as set forth in this agreement, the Company’s
obligation to make the payments provided for in this Agreement and
otherwise to perform its obligations hereunder shall not be affected by
any circumstances, including without limitation, set-off, counterclaim,
recoupment, defense or other claim, right or action which the Company may
have against the Executive or others.
</FONT>
<P align="left"><FONT size="2"> 8. Change in Control
</FONT>
<P align="left"><FONT size="2"> (a) As used in this agreement, the term “Change in Control” means the
occurrence of any one of the following events:
</FONT>
<P align="left"><FONT size="2"> (i) any “person,” as such term is used in sections 3(a)(9) and
13(d) of the Securities Exchange Act of 1934, becomes a “beneficial
owner,” as such term is used in Rule 13d-3 under that act, of 30% or
more of the outstanding common stock of the Company, excluding a
person that is an affiliate (as such term is used under that act) of
the Company on the date of
this agreement, or any affiliate of any such person;
</FONT>
<P align="left"><FONT size="2"> (ii) the majority of the board of directors of the Company consists
of individuals other than Incumbent Directors, which term means the
members of the board of directors of the Company on the date of this
agreement; provided that any person becoming a director subsequent
to such date whose election or nomination for election was supported
by two-thirds of the directors who then comprised the Incumbent
Directors shall be considered an Incumbent Director;
</FONT>
<P align="left"><FONT size="2"> (iii) the Company adopts any plan of liquidation providing for the
distribution of all or substantially all its assets;
</FONT>
<P align="left"><FONT size="2"> (iv) all or substantially all the assets or business of the Company
are disposed of pursuant to a merger, consolidation or other
transaction (unless the shareholders of the Company immediately
prior to such merger, consolidation or other transaction
beneficially own, directly or indirectly, in substantially the same
proportion as they own the common stock of the Company, all the
common stock or other ownership interests of the entity or entities,
if any, that succeed to the business of the Company); or
</FONT>
<P align="left"><FONT size="2"> (v) the Company combines with another company and is the surviving
corporation, but, immediately after the combination, the
shareholders of the Company
</FONT>
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<P><FONT size="2">immediately prior to the combination
hold, directly or indirectly, 50% or less of the common stock or
other ownership interests of the combined company (there being
excluded from the number of shares held by such shareholders, but
not from the common stock or other ownership interests of the
combined company, any shares other ownership interests received by
affiliates of such other company in exchange for stock of such other
company).
</FONT>
<P align="left"><FONT size="2"> (b) Following a Change in Control, the Executive may, at his option, upon
90 days’ written notice given to the Company, terminate his employment
under this agreement and, in lieu of any other amounts otherwise payable
to him under section 7, (i) he will be entitled to receive, in a single
lump sum on or before the 90th day after such written notice is given, an
amount equal to (A) the product of (1) the Executive Salary then in effect
and (2) three, if the written notice is given before the Senior Status
Period, or (B) the product of (1) one half of his Senior Status Salary and
(2) the number of years (including fractions), if any, remaining in the
Senior Status Period on the 90th day after such written notice is given,
if the written notice is given during the Senior Status Period, and (ii)
pursuant to section 7(f), he shall be afforded continued participation in
all medical, dental, hospitalization and life insurance coverage and in
other employee benefit plans or programs in which he was participating on
the date of the termination of his employment.
</FONT>
<P align="left"><FONT size="2"> (c) In the event the amount provided to the Executive under section 8(b)
(the “Payment”) is determined to constitute a “parachute payment,” as such
term is defined in section 280G(b)(2) of the Internal Revenue Code of
1986, as amended (the “Code”), notwithstanding anything to the contrary in
this agreement, the Executive shall be entitled to receive an additional
payment (a “Gross-Up Payment”) in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with
respect to such taxes), including, without limitation, any income taxes
(and any interest and penalties imposed with respect thereto) and any
excise tax imposed by section 4999 of the Code (and any interest and
penalties imposed with respect thereto) (collectively, “Excise Tax”)
imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payment. The
determination of whether the Payment constitutes a “parachute payment”
and, if so, the amount to be paid to the Executive and the time of payment
pursuant to this section 8(c) shall be made by an independent auditor (the
“Auditor”) jointly selected by the Company and the Executive and paid by
the Company. The Auditor shall be a nationally recognized United States
public accounting firm, which has not, during the two years preceding the
date of its selection, acted in any way on behalf of the Company or any
affiliate of the Company. If the Executive and the Company cannot agree
on the firm to serve as the Auditor, the Executive and Company shall each
select one accounting firm and those two firms shall jointly select the
accounting firm to serve as the Auditor.
</FONT>
<P><FONT size="2"> 9. Indemnification
</FONT>
<P align="left"><FONT size="2"> (a) The Company agrees that, if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding, whether
civil, criminal, administrative or investigation (a “Proceeding”), by
reason of the fact that he is or was a director, officer or employee of
the Company or is or was serving at the request of the Company as a
director, officer, member, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, including service
with respect to employee benefit plans, whether or not the basis of such
Proceeding is the Executive’s alleged action in an official capacity while
serving as director, officer, member, employee or agent, the Executive
shall be indemnified and held harmless by the Company to the fullest
extent permitted or authorized by the Company’s
</FONT>
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<P><FONT size="2">certificate of
incorporation or bylaws or, if greater, by the laws of the state of New
York, against all cost, expense, liability and loss (including, without
limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or
penalties and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Executive in connection therewith, and such
indemnification shall continue as to the Executive even if he has ceased
to be a director, member, employee or agent of the Company or other entity
and shall inure to the benefit of the Executive’s heirs, executors and
administrators. The Company shall advance to the Executive all reasonable
costs and expenses incurred by him in connection with a Proceeding within
20 days after receipt by the Company of a written request for such
advance. Such request shall include a undertaking by the Executive to
repay the amount of such advance if it shall ultimately be determined that
he is not entitled to be indemnified against such costs and expenses.
</FONT>
<P align="left"><FONT size="2"> (b) Neither the failure of the Company (including its board or directors,
independent legal counsel or shareholders) to have made a determination
prior to the commencement of any proceeding concerning payment of amounts
claimed by the Executive under section 9(a) that indemnification of the
Executive is proper because he has met the applicable standard of conduct,
nor a determination by the Company (including its board of directors,
independent legal counsel or shareholders) that the Executive has not met
such applicable standard of conduct, shall create a presumption that the
Executive has not met the applicable standard of conduct.
</FONT>
<P align="left"><FONT size="2"> (c) The Company agrees to continue and maintain a director’s and
officers’ liability insurance policy covering the Executive to the extent
the Company provides such coverage for its other executive officers.
</FONT>
<P><FONT size="2"> 10. Confidentiality. The Executive shall at all times during the period of his
employment and thereafter
hold in confidence any and all Confidential Information (as defined below)
that may have come or may come into his possession or within his knowledge
concerning the products, services, processes, businesses, suppliers,
customers and clients of the Company or its controlled affiliates. The
Executive agrees that neither he nor any person or enterprise controlled
by him will for any reason directly or indirectly, for himself or any
other person, use or disclose any trade secrets, proprietary or
confidential information, inventions, manufacturing or industrial
processes or procedures, patents, trademarks, trade names, customer lists,
service marks, service names, copyrights, applications for any of the
foregoing or licenses or other rights in respect thereof (collectively,
“Confidential Information”), owned or used by, or licensed to, the Company
or any of its controlled affiliates, provided that the Executive may
disclose Confidential Information that has become generally available to
the public other than as a result of a breach of this agreement by the
Executive or pursuant to an order of a court of competent jurisdiction or
of a governmental agency, department or commission. Upon termination of
his employment under this agreement, the Executive shall promptly
surrender to the Company all documents he believes contain Confidential
Information and that are within his possession or control, other than
documents to which the Executive is or was a party or that relate to the
Executive or the basis, or purported basis, on which his employment was
terminated.
</FONT>
<P><FONT size="2"> 11. Noncompetition and Nonsolicitation
</FONT>
<P align="left"><FONT size="2"> (a) The Executive agrees that from the date of this agreement and
subsequent to the termination of his employment under this agreement and
continuing for the period (the “Non-Compete Period”) after termination of
employment under section 7 (but not under section 8) in respect of which
salary continuation payments would be required to be made under section
7(d) (regardless of whether
termination of employment occurs pursuant to section 7(d)), neither
</FONT>
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<P><FONT size="2">the
Executive nor any person or enterprise controlled by him will become a
shareholder, lender, director, officer, agent or employee of a corporation
or member of or lender to a partnership, engage as a sole proprietor in
any business, act as a consultant to any of the foregoing or otherwise
engage directly or indirectly in any business that is in competition with
the business then conducted by the Company or any of its controlled
affiliates in any state in the United States or any other country in which
the Company or any of its controlled affiliates has engaged in such
business during the Executive’s employment under this agreement; provided,
however, that the foregoing shall not prohibit the Executive from owning
less than two percent of the outstanding securities of any class of
capital stock of a corporation the securities of which are regularly
traded or quoted on a national securities exchange or on an inter-dealer
quotation system.
</FONT>
<P align="left"><FONT size="2"> (b) The Executive agrees that, during the Non-Compete Period, neither he
nor any person or enterprise controlled by him will (i) solicit for
employment any person who was employed by the Company or any of its
controlled affiliates at any time within one year prior to the time of the
act of solicitation or (ii) in any way cause, influence or participate in
the solicitation for employment of any such individual by anyone else.
</FONT>
<P align="left"><FONT size="2"> (c) The Executive acknowledges that there is no adequate remedy at law for
a breach of this section 11 and that, in the event of such a breach or
attempted breach, the Company shall be entitled to injunctive or other
equitable relief to prevent any such breach, attempted breach or
continuing breach, without prejudice to any other remedies for damages or
otherwise.
</FONT>
<P><FONT size="2"> 12. Assignability; Binding Nature. This agreement shall inure to the benefit
of the parties and their
respective successors, heirs (in the case of the Executive) and assigns.
No rights or obligations of the Company under this agreement may be
assigned or transferred by the Company, except pursuant to a merger or
consolidation, or the sale or liquidation of all or substantially all the
assets of the Company, provided that, in the case of such a sale or
liquidation, the assignee or transferee assumes in writing the obligation
to perform this agreement (it being understood, however, that no such
assignment or transfer shall relieve the Company of its liabilities or
obligations under this agreement).
</FONT>
<P><FONT size="2"> 13. Amendment or Waiver. This agreement may not be amended or waived, except
by an instrument in writing
signed by the party to be charged.
</FONT>
<P><FONT size="2"> 14. Severability. If any provision of this agreement is invalid or
unenforceable, the remaining
provisions of this agreement shall remain in effect.
</FONT>
<P><FONT size="2"> 15. Governing Law. This agreement shall be governed by and construed and
interpreted in accordance
with the law of the state of New York as applied to agreements among New
York residents entered into and to be performed entirely within New York.
</FONT>
<P><FONT size="2"> 16. Disputes. Except as otherwise expressly provided in this agreement, any
dispute arising under or in
connection with this agreement shall, at the election of the Executive, be
resolved by binding arbitration to be held in New York City in accordance
with the rules of the American Arbitration Association. Judgment upon the
arbitrator’s award may be entered in any court having jurisdiction. Costs
of any arbitration or litigation, including, without limitation,
attorneys’ fees of both parties, shall be borne by the Company and
advanced to the Executive as appropriate from time to time, provided that,
if the arbitrator or judge, as the case may be, determines that the claims
or defenses of the Executive were without any reasonable basis, each party
shall bear his or its own costs.
</FONT>
<P><FONT size="2"> 17. Notices. All notices and other communications under this agreement shall
be in writing and may be
given by any of the following methods: (a) personal delivery; (b)
facsimile
</FONT>
<P align="center"><FONT size="2">8</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">transmission; (c) registered or certified mail, postage prepaid,
return receipt requested; or (d) overnight delivery
service. Notices shall be sent to the appropriate party at its or his
address or facsimile number given below (or at such other address or
facsimile number for that party as specified by notice given under this
section 17):
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">if to the Company, to it at:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">650 Liberty Avenue<BR>
Union, New Jersey 07083<BR>
Fax: 908-688-8385</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">if to the Executive, to him at:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="50%"><FONT size="2"> </FONT></TD>
<TD width="50%"><FONT size="2">[***]</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">All such notices and communications shall be deemed given and received
upon (a) actual receipt by the addressee, (b) actual delivery to the
appropriate address or (c) in the case of a facsimile transmission, upon
transmission by the sender and issuance by the transmitting machine of a
confirmation slip confirming that the number of pages constituting the
notice have been transmitted without error. In the case of notices sent
by facsimile transmission, the sender shall contemporaneously mail a copy
of the notice to the addressee at the address provided above; however,
such mailing shall in no way alter the time at which the facsimile notice
is deemed given and received.
</FONT>
<P><FONT size="2"> 18. Headings. The section headings in this agreement are for convenience
only and shall not affect the
meaning or construction of any provision of this agreement.
</FONT>
<P><FONT size="2"> 19. Counterparts. This agreement may be executed in counterparts.
</FONT>
<P><FONT size="2"> 20. Entire Agreement. This agreement contains the entire agreement and
understanding of the parties
concerning its subject matter and supersedes all prior agreements and
understandings with respect to that subject matter. Nothing in this
agreement is intended to
</FONT>
<P align="center"><FONT size="2">9</FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2">or shall affect the rights or obligations of the
parties under any agreement relating to the maintenance of life insurance
or stock options.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
<TD width="15%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="72%"> </TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3" valign="top" align="left"><FONT size="2">BED BATH & BEYOND INC.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">
By:
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">/s/ Warren Eisenberg</FONT></TD>
</TR>
<TR>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Name: Warren Eisenberg<BR>
Title: Co-Chief Executive Officer</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD colspan="3" valign="top" align="left"><FONT size="2">THE EXECUTIVE:</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">/s/ Leonard Feinstein</FONT></TD>
</TR>
<TR>
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="top"><FONT size="2">Leonard Feinstein</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">10</FONT>
</BODY>
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-13
<SEQUENCE>5
<FILENAME>y61131exv13.htm
<DESCRIPTION>EXHIBIT 13
<TEXT>
<HTML>
<HEAD>
<TITLE>2001 ANNUAL REPORT</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="center"><FONT size="2"><B>ANNUAL REPORT ON FORM 10-K</B>
</FONT>
<P align="center"><FONT size="2"><B>ITEM 14 (a)(3)</B>
</FONT>
<P align="center"><FONT size="2"><B>Exhibit 13</B>
</FONT>
<P align="center"><FONT size="2"><B>BED BATH & BEYOND INC.</B>
</FONT>
<P align="center"><FONT size="2"><B>Fiscal Year Ended March 2, 2002</B>
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>Selected Financial Data</B></FONT><FONT size="2"> <B>(in thousands, except per share and selected operating data)</B>
</FONT>
<DIV align="left"></DIV>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="35%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TR><TD>
</TR></TD>
<TD nowrap align="center" colspan="20"><FONT size="1"><B>Fiscal Year Ended</B><SUP><B>(1)</B></SUP></FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="21"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 3,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 26,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 27,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 28,</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2001</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2000</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1999</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1998</B></FONT></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>STATEMENT OF EARNINGS DATA</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net sales</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">2,927,962</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">2,396,655</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">1,857,505</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">1,382,345</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">1,057,135</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Gross profit</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">1,207,566</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">986,459</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">766,801</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">576,125</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">441,016</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Operating profit</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">346,100</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">272,838</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">209,340</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">158,052</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">118,914</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net earnings</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">219,599</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">171,922</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">131,229</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">97,346</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">73,142</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net earnings per share –
Diluted <SUP>(2)</SUP></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.74</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.59</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.46</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.34</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.26</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>SELECTED OPERATING DATA</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Number of stores open
(at period end)</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">396</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">311</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">241</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">186</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">141</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Total square feet of store space
(at period end)</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">14,724,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">12,204,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">9,815,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">7,688,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">5,767,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Percentage increase in
comparable store net sales</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">7.1</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">5.0</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">9.2</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">7.6</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">6.4</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>BALANCE SHEET DATA (AT PERIOD END)</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Working capital</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">715,439</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">532,524</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">360,585</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">267,557</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">188,293</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Total assets</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">1,647,517</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">1,195,725</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">865,800</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">633,148</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">458,330</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Long-term debt</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Shareholders’ equity</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">1,094,350</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">817,018</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">559,045</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">411,087</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">295,397</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
</TABLE>
<BR clear="all">
<P align="right"><FONT size="2">[Additional columns below]</FONT>
<P><FONT size="2">[Continued from above table, first column(s) repeated]</FONT>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="35%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="4%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TR><TD>
</TR></TD>
<TD nowrap align="center" colspan="20"><FONT size="1"><B>Fiscal Year Ended</B><SUP><B>(1)</B></SUP></FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="21"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 1,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 25,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 26,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 27,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>February 28,</B></FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1997</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1996</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1995</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1994</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>1993</B></FONT></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>STATEMENT OF EARNINGS DATA</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net sales</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">816,912</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">597,352</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">437,807</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">304,571</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">216,411</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Gross profit</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">341,168</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">250,036</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">183,819</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">127,972</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">90,528</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Operating profit</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">90,607</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">67,585</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">51,685</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">36,906</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">26,660</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net earnings</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">55,015</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">39,459</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">30,013</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">21,887</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">15,960</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Net earnings per share –
Diluted <SUP>(2)</SUP></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.20</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.14</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.11</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.08</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">.06</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>SELECTED OPERATING DATA</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Number of stores open
(at period end)</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">108</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">80</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">61</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">45</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">38</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Total square feet of store space
(at period end)</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">4,347,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">3,214,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">2,339,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">1,512,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">1,128,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Percentage increase in
comparable store net sales</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">6.1</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">3.8</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">12.0</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">10.6</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="right"><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">7.2</FONT></TD>
<TD nowrap><FONT size="1">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1"><B>BALANCE SHEET DATA (AT PERIOD END)</B></FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Working capital</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">127,333</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">91,331</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">74,390</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">56,001</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">34,842</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Total assets</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">329,925</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">235,810</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">176,678</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">121,468</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">76,654</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Long-term debt</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">5,000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">16,800</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">13,300</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">–</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Shareholders’ equity</FONT></DIV></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">214,361</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">151,446</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">108,939</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">77,305</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD align="right"><FONT size="1">$</FONT></TD>
<TD align="right"><FONT size="1">54,643</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
</TR>
</TABLE>
<BR clear="all">
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><I>(1)</I></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><I>Each fiscal year represents 52 weeks, except for fiscal 2000 (ended March
3, 2001) which represents 53 weeks and fiscal 1996 (ended March 1, 1997) which
represents 52 weeks and 6 days.</I></FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="top">
<TD width="1%" align="left" nowrap><FONT size="2"><I>(2)</I></FONT></TD>
<TD width="3%"><FONT size="2"> </FONT></TD>
<TD width="96%"><FONT size="2"><I>Net earnings per share amounts for fiscal 2000 and prior have been adjusted
for two-for-one stock splits of the Company’s common stock (each of which was
effected in the form of a 100% stock dividend), which were distributed in
fiscal 2000, 1998, 1996 and 1993. The Company has not declared any cash
dividends in any of the fiscal years noted above.</I></FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">PLEASE VOTE YOUR PROXY!<BR>
ELECTRONIC VOTING SAVES YOUR COMPANY MONEY
</FONT>
<P><FONT size="2"><I>Last year, many of our shareholders saved the Company money by voting their
proxies via internet or telephone, rather than by return mail. This year we
encourage all of our shareholders to take advantage of electronic voting.</I>
</FONT>
<P><FONT size="2"> <I>Most Bed Bath & Beyond shareholders hold their shares through a
stockbroker, bank or other nominee rather than directly in their own name. If
you hold your shares in one of these ways, you are considered a beneficial
owner. Your broker or nominee has enclosed a voting instruction form for you to
use in directing them in how to vote your shares. Most institutions make
internet or telephone voting options available to their beneficial owners, so
please see the voting instruction form for specific information.</I>
</FONT>
<P><FONT size="2"> <I>If your shares are registered directly in your name with Bed Bath &
Beyond’s transfer agent, you are considered the shareholder of record with
respect to those shares, and these proxy materials are being sent directly to
you. As the shareholder of record, you have the right to vote by proxy. We
encourage our registered shareholders to vote your proxy:</I>
</FONT>
<P><FONT size="2"><I>By internet – </I><B>www.proxyvote.com; </B><I>or</I>
</FONT>
<P><FONT size="2"><I>By touch-tone phone – </I><B>1-800-690-6903</B>
</FONT>
<P><FONT size="2"><I>Have your proxy card in hand when you access the web site or call the toll-free
number. You will be prompted to enter your 12-digit Control Number, which is
located below the voting instructions on the proxy card. Then you can follow
the directions provided.</I>
</FONT>
<P><FONT size="2"><B>Founded in 1971, Bed Bath & Beyond Inc. is a nationwide chain of stores selling
predominantly better quality domestics merchandise and home furnishings. The
Company’s 407 Bed Bath & Beyond stores (as of May 3, 2002) principally range in
size from 25,000 to 50,000 square feet, with some stores exceeding 80,000
square feet.
They combine superior service and a huge selection of items at everyday low
prices within a constantly evolving shopping environment that has proven to be
both fun and exciting for customers. The Company acquired Harmon Stores, Inc.,
a health and beauty care retailer, on March 5, 2002. The Company’s 28 Harmon
stores
(as of May 3, 2002) principally range in size from 5,000 to 8,700 square feet.
Bed Bath & Beyond Inc.’s stock is traded on the NASDAQ National Market under
the symbol BBBY and is included in the Standard & Poor’s 500 Index, the
NASDAQ-100 Index, and the Forbes 500.</B>
</FONT>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
1
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>To Our Fellow Shareholders:</B>
</FONT>
<P><FONT size="2">This is a new look for us, but we’re sure it comes as no surprise. We try to
keep things simple that ought to be kept simple. To present you with the
portrait of fiscal 2001, our 30th Anniversary and best year ever, we have
combined the Bed Bath & Beyond Inc. Notice of Annual Meeting and Proxy
Statement with our Annual Report. The Annual Report and Proxy materials are
about conveying information, and we are doing that as simply and directly as we
can. The color and the excitement are where they have always been: in the
stores.
</FONT>
<P><FONT size="2"> For 30 years, this Company’s primary focus has been on our merchandise and
the operation of our stores, because these are the things our customers see.
For the 10 years since our initial public offering, the ability of our people
to execute on this focus has resulted in our meeting or exceeding expectations
in each of our 39 quarters as a public company. Our formula constantly evolves,
it works, and we are enormously grateful for the efforts of all our associates
who make it work.
</FONT>
<P><FONT size="2"> In a way, what you see in these materials serves that same focus. We have
simplified these documents because we believe your money is better spent
elsewhere. This is another effort to return more value to our shareholders. By
pulling back a little on the glitz, we have a little more to spend where it
matters most – in the stores, online, and in support of all we do as merchants.
</FONT>
<P><FONT size="2"> In keeping with the spirit of simplification, we do want to share some of
the highlights from fiscal 2001 that you will see in the following pages. Net
earnings for the year (fifty-two weeks) ended March 2, 2002 totaled $219.6
million ($.74 per share), exceeding fiscal 2000 (fifty-three weeks) net
earnings of $171.9 million ($.59 per share) by approximately 27.7%.
</FONT>
<P><FONT size="2"> Net sales for fiscal 2001 were $2.9 billion, an increase of approximately
22.2% from the prior year. Comparable store sales for fiscal 2001 increased by
approximately 7.1%. During fiscal 2001, we opened 85 new Bed Bath & Beyond
stores. We ended the year with 395 stores in 44 states and one store in Puerto
Rico.
</FONT>
<P><FONT size="2"> Our balance sheet continues to strengthen. At the close of fiscal 2001,
cash and cash equivalents were $429.5 million, and the Company had an
additional $51.9 million in investment securities, compared to $239.3 million
in cash and cash
equivalents a year earlier. Shareholders’ equity at year end was $1.1 billion,
up from $817.0 million the prior year.
</FONT>
<P><FONT size="2"> This doesn’t just happen. Over 19,000 talented people work very hard,
creatively and constructively finding ways to please our customers. Ultimately,
the credit is theirs. For the 30 years we have been in business and the 10
years we’ve been sending out these annual reports, we’ve been talking about our
culture. It isn’t just a word. Our people are trained to know what is important to
the customer and empowered in our decentralized environment to act on that
knowledge. Our customer has other choices; we must exceed expectations.
Everything else flows from this, particularly the financial results that follow
in this booklet.
</FONT>
<P><FONT size="2"> While we celebrate our 30th Anniversary and our finest year ever, we are
of course mindful of the criminal acts committed against our nation this past
year. The events of September 11th and the ongoing war on terrorism temper our
celebration and place our accomplishments in proper perspective. Still, we are
again pleased with the results we have to report to you. In keeping with our
culture, however, pleased does not mean satisfied. We plan to open
approximately 88 new Bed Bath & Beyond stores in fiscal 2002, in new and
existing markets. We continue to evaluate new merchandise items, new
departments, system and process enhancements, new looks in fixturing and store
design, and every point of contact we have to improve the results of our
operations. On March 5, 2002, we consummated the acquisition of Harmon Stores,
Inc., a health and beauty care retailer currently operating 28 stores in New
Jersey (22), New York (5) and Connecticut (1). This represents something new
for us as well, and while we do not believe the benefits to be derived this
year will have any material effect on our overall results or financial
condition for 2002, we are excited by the opportunities.
</FONT>
<P><FONT size="2"> We know it all begins and ends with our customers. As we begin the next 30
years of our existence, we rededicate ourselves to the culture of exceeding
their expectations. By remaining committed to the principles upon which we were
founded, we intend to make 2002 another record year.
</FONT>
<P><FONT size="2"> Again, thank you to each of our associates, customers and business
partners who continue to lead us toward the ever more successful company we are
striving to become.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="22%"> </TD>
<TD width="10%"> </TD>
<TD width="32%"> </TD>
<TD width="3%"> </TD>
<TD width="32%"> </TD>
</TR>
<TR valign="bottom">
<TD valign="bottom"><FONT size="2">
<IMG src="y61131y61131s1.gif"><br>
WARREN EISENBERG<br>
<I>Co-Chairman and<br>
Co-Chief Executive Officer</I></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="bottom"><FONT size="2">
<IMG src="y61131y61131s2.gif"><br>
LEONARD FEINSTEIN<br>
<I>Co-Chairman and<br>
Co-Chief Executive Officer</I>
</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="left" valign="bottom"><FONT size="2"><IMG src="y61131y61131s3.gif"> <br>
STEVEN H. TEMARES<br>
<I>President & Chief Operating Officer<br>
and Member of the Board of Directors</I></FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="left"><FONT size="2"><I>May 3, 2002</I>
</FONT>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
2
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>Management’s Discussion and Analysis of Financial Condition and Results of Operations</B>
</FONT>
<P><FONT size="2"><B>RESULTS OF OPERATIONS</B><br>
The following table sets forth for the periods indicated (i) selected statement
of earnings data of the Company expressed as a percentage of net sales and (ii)
the percentage change in dollar amounts from the prior year in selected
statement of earnings data:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="40%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="1%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="1%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="1%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="2%"> </TD>
<TD width="1%"> </TD>
<TD width="2%"> </TD>
<TD width="5%"> </TD>
<TD width="2%"> </TD>
<TD width="1%"> </TD>
<TD width="2%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="19"><FONT size="1">FISCAL YEAR ENDED</FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="21"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="11"><FONT size="1">PERCENTAGE</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="7"><FONT size="1">PERCENTAGE CHANGE</FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="11"><FONT size="1">OF NET SALES</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="7"><FONT size="1">FROM PRIOR YEAR</FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="13"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="7"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>MARCH 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">MARCH 3,</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">FEBRUARY 26,</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>MARCH 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">MARCH 3,</FONT></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2001</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2000</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2001</FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="13"><HR size="1" noshade></TD>
<TD><FONT size="1"> </FONT></TD>
<TD colspan="7"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Net sales</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>100.0</B></FONT></TD>
<TD nowrap><FONT size="2"><B>%</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">100.0</FONT></TD>
<TD nowrap><FONT size="2">%</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">100.0</FONT></TD>
<TD nowrap><FONT size="2">%</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>22.2</B></FONT></TD>
<TD nowrap><FONT size="2"><B>%</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD nowrap align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">29.0</FONT></TD>
<TD nowrap><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Cost of sales</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>58.8</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">58.8</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">58.7</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>22.0</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">29.3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Gross profit</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>41.2</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">41.2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">41.3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>22.4</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">28.6</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Selling, general and
administrative expenses</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>29.4</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">29.8</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">30.0</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>20.7</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">28.0</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Operating profit</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>11.8</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">11.4</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">11.3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>26.9</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">30.3</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Earnings before provision
for income taxes</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>12.2</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">11.8</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">11.6</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>26.7</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">31.0</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Net earnings</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>7.5</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7.2</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7.1</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>27.7</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">31.0</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2"><B>FISCAL 2001 COMPARED WITH FISCAL 2000</B><br>
In fiscal 2001 (52 weeks), the Company expanded store space
by 20.6%, from 12,204,000 square feet at fiscal year end 2000
(53 weeks) to 14,724,000 square feet at fiscal year end 2001.
The 2,520,000 square feet increase was the result of opening
85 new stores.
</FONT>
<P><FONT size="2"> Net sales in fiscal 2001 increased $531.3 million to $2.928 billion,
representing an increase of 22.2% over the $2.397 billion net sales in fiscal
2000. Approximately 73% of the increase was attributable to new store net sales
and the balance to an increase in comparable store net sales.
</FONT>
<P><FONT size="2"> Approximately 54% and 46% of net sales in fiscal 2001 were attributable to
sales of domestics merchandise and home furnishings, respectively. The Company
estimates that bed linens accounted for approximately 19% of net sales during
fiscal 2001 and 21% of net sales during fiscal 2000. No other individual
product category accounted for 10% or more of net sales during either fiscal
year.
</FONT>
<P><FONT size="2"> Gross profit in fiscal 2001 was $1.208 billion or 41.2% of
net sales, compared with $986.5 million or 41.2% of net sales a year ago.
Gross profit, as a percentage of net sales, remained consistent due to the
similar product mix in fiscal 2001 and
fiscal 2000.
</FONT>
<P><FONT size="2"> Comparable store sales for fiscal 2001 (52 weeks vs. 52 weeks) increased
by approximately 7.1%, compared with an increase of approximately 5.0% in
fiscal 2000. The increase in comparable store net sales relative to fiscal 2000
reflected a number of factors, including but not limited to, the continued
consumer acceptance of the Company’s merchandise offerings,
a strong focus on customer service and the continued success of the
Company’s advertising program.
</FONT>
<P><FONT size="2"> Selling, general and administrative expenses (“SG&A”) were $861.5 million
or 29.4% of net sales in fiscal 2001 compared to $713.6 million or 29.8% of net
sales in fiscal 2000. The decrease in SG&A as a percentage of net sales
primarily reflects a relative decrease in payroll and payroll related items
primarily due to an increase in store productivity. Store opening and expansion
costs are charged to earnings as incurred.
</FONT>
<P><FONT size="2"> Interest income increased to $11.0 million in fiscal 2001 compared to $9.0
million in fiscal 2000 due to an increase in invested cash partially offset by
a decrease in the average investment rate.
</FONT>
<P><FONT size="2"> The effective tax rate decreased to 38.5% for fiscal 2001 compared with
39.0% for fiscal 2000 due to a decrease in the amount provided for state and
local taxes resulting primarily from the composition of states and the
territory in which the Company currently conducts business.
</FONT>
<P><FONT size="2"><B>FISCAL 2000 COMPARED WITH FISCAL 1999</B><br>
In fiscal 2000 (53 weeks), the Company expanded store space by 24.3%, from
9,815,000 square feet at fiscal year end 1999 (52 weeks) to 12,204,000 square
feet at fiscal year end 2000. The 2,389,000 square feet increase was the result
of opening 70 new stores and expanding two existing stores.
</FONT>
<P><FONT size="2"> Net sales in fiscal 2000 increased $539.2 million to $2.397 billion,
representing an increase of 29.0% over the $1.858 billion net sales in fiscal
1999. Approximately 83% of the increase was attributable to new store net sales
and the balance to an increase in comparable store net sales.
</FONT>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
3
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>Management’s Discussion and Analysis of Financial Condition and Results of Operations</B><br>
</FONT>
<DIV align="left"><FONT size="2"><I>(Continued)</I>
</FONT></DIV>
<P><FONT size="2"> Approximately 55% and 45% of net sales in fiscal 2000
were attributable to sales of domestics merchandise and home furnishings,
respectively. The Company estimates that bed linens accounted for approximately
21% of net sales during both fiscal 2000 and fiscal 1999. No other individual
product category accounted for 10% or more of net sales during either fiscal
year.
</FONT>
<P><FONT size="2"> Gross profit in fiscal 2000 was $986.5 million or 41.2% of
net sales, compared with $766.8 million or 41.3% of net sales
in fiscal 1999.
</FONT>
<P><FONT size="2"> Comparable store sales for fiscal 2000 (52 weeks vs. 52 weeks) increased
by approximately 5.0%, compared with an increase of approximately 9.2% in
fiscal 1999. The fiscal 2000 increase in comparable store net sales primarily
reflected a strong focus on customer service, as well as the continued consumer
acceptance of the Company’s merchandise offerings and the continued success of
the Company’s advertising program.
</FONT>
<P><FONT size="2"> SG&A was $713.6 million or 29.8% of net sales in fiscal 2000 compared to
$557.5 million or 30.0% of net sales in fiscal 1999. The decrease in SG&A as a
percentage of net sales primarily reflected a decrease in occupancy costs and
costs associated with new store openings and expansions partially offset by an
increase in payroll and payroll related items. Store opening and expansion
costs were charged to earnings as incurred.
</FONT>
<P><FONT size="2"> Interest income increased to $9.0 million in fiscal 2000 compared to $5.8
million in fiscal 1999 due to an increase in invested cash and an increase in
the average investment rate.
</FONT>
<P><FONT size="2"> The effective tax rate remained consistent at 39.0% in fiscal 2000 and
fiscal 1999 due to the consistent composition of states in which the Company
conducted business.
</FONT>
<P><FONT size="2"><B>EXPANSION PROGRAM</B><br>
The Company is engaged in an ongoing expansion program involving the opening of
new stores in both new and existing markets and the expansion or replacement of
existing stores with larger stores. In the ten-year period from the beginning
of fiscal 1992 to the end of fiscal 2001, the chain has grown from 34 stores to
396 stores. Total square footage grew from 917,000 square feet at the beginning
of fiscal 1992 to 14,724,000 square feet at the end of fiscal 2001.
</FONT>
<P><FONT size="2"> The Company intends to continue its expansion program and currently
anticipates that in fiscal 2002 it will open approximately 88 new Bed Bath &
Beyond stores (see details under “Liquidity and Capital Resources” below). The
Company believes that a predominant portion of any increase in its net sales in
fiscal 2002 will continue to be attributable to new store net sales.
Accordingly, the continued growth of the Company
is dependent, in large part, upon the Company’s ability to execute its
expansion program successfully, of which there can
be no assurance.
</FONT>
<P><FONT size="2"><B>LIQUIDITY AND CAPITAL RESOURCES</B><br>
The Company has been able to finance both its normal operations and its
expansion program through internally generated funds. The Company’s merchandise
inventories have grown from $470.4 million at the end of fiscal 1999, to $606.7
million at the end of fiscal 2000 and to $754.0 million at the end of fiscal
2001. The increases in inventory between the fiscal years were primarily
attributable to the addition of new store space.
</FONT>
<P><FONT size="2"> The Company’s working capital increased from $360.6 million at the end of
fiscal 1999, to $532.5 million at the end of fiscal 2000, and to $715.4 million
at the end of fiscal 2001. The increases between the fiscal years were
primarily the result of increases in cash and cash equivalents and merchandise
inventories, which were partially offset by increases in accounts payable and
accrued expenses and other current liabilities.
</FONT>
<P><FONT size="2"> The Company’s expansion program requires the Company to make capital
expenditures for furniture and fixtures, leasehold improvements and computer
equipment on an ongoing basis. The Company’s total capital expenditures were
$121.6 million, $140.4 million and $90.1 million during fiscal 2001, 2000 and
1999, respectively.
</FONT>
<P><FONT size="2"> During fiscal 2001, the Company entered into a $50 million uncommitted
line of credit which replaced the Company’s previous $25 million committed line
of credit (“the Credit Agreement”). The uncommitted line of credit, which
expires in September 2002, is intended to be used for letters of credit in the
ordinary course of business. During fiscal 2001, the Company had no direct
borrowings under the uncommitted line of credit or the Credit Agreement; during
fiscal 2000 and 1999, the Company did not borrow under the Credit Agreement.
The Company believes that during fiscal 2002, internally generated funds will
be sufficient to fund both its normal operations and its expansion program.
</FONT>
<P><FONT size="2"> The Company has contractual obligations consisting of all operating leases
for buildings, office facilities and equipment which are payable as follows as
of March 2, 2002:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="18%"> </TD>
<TD width="5%"> </TD>
<TD width="6%"> </TD>
<TD width="1%"> </TD>
<TD width="6%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">LESS THAN 1</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">AFTER 5</FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap><FONT size="1"><I>(in 000's)</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">TOTAL</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">YEAR</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">1-3 YEARS</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">4-5 YEARS</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">YEARS</FONT></TD>
</TR>
<TR>
<TD colspan="21" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Operating
Leases</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">2,141,947</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">198,275</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">611,716</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">385,997</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">945,959</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2"> As of May 3, 2002, the Company has leased sites for 61 new Bed Bath &
Beyond stores planned for opening in fiscal 2002, including eleven new stores
already opened in Encino
and Monrovia, California; Grand Junction, Colorado; Manchester,
Connecticut; Cumming, Georgia; Woodbury, Minnesota; Mount Olive, New Jersey;
Onslow, North Carolina; Eastgate, Ohio; Erie, Pennsylvania; and Lynchburg,
Virginia.
</FONT>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
4
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P><FONT size="2"> Approximate aggregate costs for the 61 leased stores planned for opening in
fiscal 2002 are estimated at $88.6 million for merchandise inventories, $54.3
million for furniture and fixtures and leasehold improvements and $13.4 million
for store opening expenses (which will be expensed as incurred). In addition to
the 61 locations already leased, the Company expects to open and lease
approximately 27 additional locations during fiscal 2002.
</FONT>
<P><FONT size="2"><B>RECENT ACCOUNTING PRONOUNCEMENT</B><br>
In August 2001, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for
the Impairment or Disposal of Long-Lived Assets,” which supersedes SFAS No.
121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of.” This statement addresses accounting and reporting
for the impairment or disposal of long-lived assets. The statement supersedes
SFAS No. 121, while retaining many of the fundamental provisions covered by
that statement. SFAS No. 144 differs fundamentally from SFAS No. 121 in that
goodwill and other intangible assets that are not amortized are excluded from
the scope of SFAS No. 144. SFAS No. 144 is effective for the Company in fiscal
2002. The Company does not believe that the adoption of SFAS No. 144 will have
a material impact on the Company’s consolidated financial statements.
</FONT>
<P><FONT size="2"><B>CRITICAL ACCOUNTING POLICIES</B><br>
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the
Company to establish accounting policies and to make estimates and judgments
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities as of the date of the consolidated financial
statements and the reported amounts of revenues and expenses during the
reporting period. The Company bases its estimates on historical experience and
on other assumptions that it believes to be relevant under the circumstances,
the results of which form the basis for making judgments about the carrying
value of assets and liabilities that are not readily apparent from other
sources. For a detailed discussion of our critical accounting policies and
related estimates and judgments, see Note 1 to the consolidated financial
statements. In particular, judgment is used in areas such as the provision for
sales returns, inventory valuation using the retail inventory method, and
accruals for self insurance, litigation and store relocations and closings.
Actual results could differ from these estimates.
</FONT>
<P><FONT size="2"><B>ACQUISITION</B><br>
Subsequent to year end, on March 5, 2002, the Company consummated the
acquisition of Harmon Stores, Inc., a health and beauty care retailer. The
Company believes the acquisition will not have a material effect on its
consolidated results of operations or financial condition in fiscal 2002.
</FONT>
<P><FONT size="2"> Effective March 3, 2002, the Company adopted SFAS No. 141, “Business
Combinations” and SFAS No. 142, “Goodwill and Other Intangible Assets.” SFAS
No. 141 requires the purchase method of accounting for business combinations
initiated or completed after June 30, 2001. SFAS No. 142 discontinued the
amortization of goodwill and other intangible assets with indefinite useful
lives and requires periodic goodwill impairment testing. Consequently, the
Company will not amortize any goodwill recognized as a result of the
acquisition described below and will perform impairment testing as required.
The Company does not believe that the adoption of SFAS No. 141 and SFAS No. 142
will have a material impact on the Company’s consolidated financial statements.
</FONT>
<P><FONT size="2"><B>FORWARD LOOKING STATEMENTS</B><br>
This Annual Report and, in particular, Management’s Discussion and Analysis of
Financial Condition and Results of Operations, and the Shareholder Letter,
contain forward looking statements within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended. The Company’s actual results and
future financial condition may differ materially from those expressed in any
such forward looking statements as a result of many factors that may be outside
the Company’s control. Such factors include, without limitation: general
economic conditions, changes in
the retailing environment and consumer spending habits, demographics and other
macroeconomic factors that may impact the level of spending for the types of
merchandise sold by the Company; unusual weather patterns; competition from
existing and potential competitors; competition from other channels of
distribution; pricing pressures; the ability to find suitable locations
at reasonable occupancy costs to support the Company’s expansion program; and
the cost of labor, merchandise and other costs and expenses.
</FONT>
<P><FONT size="2"><B>SEASONALITY</B><br>
Bed Bath & Beyond stores exhibit less seasonality than many other retail
businesses, although sales levels are generally higher in August, November and
December, and generally lower in February and March.
</FONT>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
5
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>Consolidated Balance Sheets</B>
</FONT>
<DIV align="left"><FONT size="2"><I>Bed Bath & Beyond Inc. and Subsidiaries</I>
</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="3%"> </TD>
<TD width="3%"> </TD>
<TD width="66%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">March 3,</FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap colspan="3"><FONT size="1"><I>(in thousands, except per share data)</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2001</FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>ASSETS</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Current assets:</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Cash and cash equivalents</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>429,496</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">239,328</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Merchandise inventories</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>753,972</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">606,704</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Other current assets</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>43,249</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">39,681</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Total current assets</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>1,226,717</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">885,713</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Investment securities</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>51,909</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>–</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Property and equipment, net</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>361,741</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">302,656</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Other assets</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>7,150</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">7,356</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"> </FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>1,647,517</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">1,195,725</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="4" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>LIABILITIES AND SHAREHOLDERS’ EQUITY</B></FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Current liabilities:</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Accounts payable</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>270,917</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">192,401</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Accrued expenses and other current liabilities</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>190,923</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">128,800</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Income taxes payable</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>49,438</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">31,988</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Total current liabilities</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>511,278</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">353,189</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Deferred rent and other liabilities</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>41,889</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">25,518</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Total liabilities</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>553,167</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">378,707</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Commitments and contingencies (notes 3, 7 and 9)</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Shareholders’ equity:</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Preferred stock – $0.01 par value; authorized – 1,000 shares;
no shares issued or outstanding</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>–</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">–</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Common stock – $0.01 par value; authorized –
900,000 shares; issued and outstanding –
March 2, 2002, 291,441 shares and
March 3, 2001, 287,890 shares</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>2,914</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">2,879</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Additional paid-in capital</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>238,672</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">180,974</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD><FONT size="2"> </FONT></TD>
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Retained earnings</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>852,764</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">633,165</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Total shareholders’ equity</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>1,094,350</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">817,018</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD colspan="3"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"> </FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>1,647,517</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">1,195,725</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="11" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="4" noshade></DIV></TD>
</TR>
</TABLE>
</CENTER>
<DIV><FONT size="2"><I>See accompanying Notes to Consolidated Financial Statements.</I>
</FONT></DIV>
<P align="center"><FONT size="2">BED BATH & BEYOND <B>ANNUAL REPORT 2001</B><BR>
6
</FONT>
<P align="center"><FONT size="2"> </FONT>
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"> </H5><P>
<P align="left"><FONT size="3"><B>Consolidated Statements of Earnings</B>
</FONT>
<DIV align="left"><FONT size="2"><I>Bed Bath & Beyond Inc. and Subsidiaries</I>
</FONT></DIV>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
<TD width="3%"> </TD>
<TD width="55%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
<TD width="3%"> </TD>
<TD width="5%"> </TD>
<TD width="1%"> </TD>
<TD width="5%"> </TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="11"><FONT size="1">FISCAL YEAR ENDED</FONT></TD>
</TR>
<TR valign="bottom">
<TD colspan="14"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>March 2,</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">March 3,</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">February 26,</FONT></TD>
</TR>
<TR valign="bottom">
<TD nowrap colspan="2"><FONT size="1"><I>(in thousands, except per share data)</I></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1"><B>2002</B></FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2001</FONT></TD>
<TD><FONT size="1"> </FONT></TD>
<TD nowrap align="center" colspan="3"><FONT size="1">2000</FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Net sales</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>2,927,962</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">2,396,655</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">1,857,505</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Cost of sales</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>1,720,396</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,410,196</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">1,090,704</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Gross profit</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>1,207,566</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">986,459</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">766,801</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Selling, general and administrative expenses</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>861,466</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">713,621</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">557,461</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Operating profit</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>346,100</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">272,838</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">209,340</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Interest income</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>10,972</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">9,001</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">5,790</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Earnings before provision for income taxes</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>357,072</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">281,839</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">215,130</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Provision for income taxes</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>137,473</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">109,917</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">83,901</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="1" noshade></DIV></TD>
</TR>
<TR valign="bottom" bgcolor="#eeeeee">
<TD><FONT size="2"> </FONT></TD>
<TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Net earnings</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>219,599</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">171,922</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">131,229</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
</TR>
<TR>
<TD colspan="14" align="left"><DIV style="margin-left:10px; text-indent:-10px"><HR size="4" noshade></DIV></TD>
</TR>
<TR valign="bottom">
<TD colspan="2"><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Net earnings per share – Basic</FONT></DIV></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2"><B>$</B></FONT></TD>
<TD align="right"><FONT size="2"><B>.76</B></FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">.61</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD><FONT size="2"> </FONT></TD>
<TD align="right"><FONT size="2">$</FONT></TD>
<TD align="right"><FONT size="2">.47</FONT></TD>
<TD><FONT size="2"> </FONT></TD>
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