-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VWDc6PTVvWdJjdsb978oKUKddPmqZm0w/yYBohP00joBGUmK/iL1mqybL9VvdjAK iuKQh3tpT90eHEdYAueyYg== 0000950123-99-000139.txt : 19990112 0000950123-99-000139.hdr.sgml : 19990112 ACCESSION NUMBER: 0000950123-99-000139 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19981128 FILED AS OF DATE: 19990111 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-Q SEC ACT: SEC FILE NUMBER: 000-20214 FILM NUMBER: 99504348 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 10-Q 1 BED BATH & BEYOND INC 1 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended November 28, 1998 COMMISSION FILE NUMBER 0-20214 BED BATH & BEYOND INC. (Exact name of registrant as specified in its charter) NEW YORK 11-2250488 (State of incorporation) (I.R.S. Employer Identification No.) 650 LIBERTY AVENUE, UNION, NEW JERSEY 07083 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (908) 688-0888 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 X No --- --- NUMBER OF SHARES OUTSTANDING OF THE ISSUER'S COMMON STOCK: CLASS OUTSTANDING AT NOVEMBER 28, 1998 ----- -------------------------------- Common Stock - $0.01 par value 139,201,141 (gives effect to a two-for-one stock split in the form of a stock dividend effected July 31, 1998) ================================================================================ 2 BED BATH & BEYOND INC. AND SUBSIDIARIES INDEX PAGE NO. -------- PART I - FINANCIAL INFORMATION Consolidated Balance Sheets November 28, 1998 and February 28, 1998 3 Consolidated Statements of Earnings Three Months and Nine Months Ended November 28, 1998 and November 29, 1997 4 Consolidated Statements of Cash Flows Nine Months Ended November 28, 1998 and November 29, 1997 5 Notes to Consolidated Financial Statements 6 Management's Discussion and Analysis of Financial Condition and Results of Operations 7 - 9 PART II - OTHER INFORMATION Item 5. Other information 10 Item 6. Exhibits and Reports on Form 8-K 10 Exhibit Index 11 3 BED BATH & BEYOND INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
November 28, February 28, 1998 1998 ------------ ------------ (unaudited) ASSETS Current assets: Cash and cash equivalents $ 74,550 $ 53,280 Merchandise inventories 401,749 270,357 Prepaid expenses and other current assets 7,517 2,323 -------- -------- Total current assets 483,816 325,960 -------- -------- Property and equipment, net 137,251 111,381 Other assets 25,801 20,989 -------- -------- $646,868 $458,330 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $163,354 $ 64,718 Accrued expenses and other current liabilities 85,197 73,610 Income taxes payable 9,820 12,015 -------- -------- Total current liabilities 258,371 150,343 -------- -------- Deferred rent 15,367 12,590 -------- -------- Total liabilities 273,738 162,933 -------- -------- Shareholders' equity: Preferred stock - $0.01 par value; authorized - 1,000,000 shares; no shares issued or outstanding -- -- Common stock - $0.01 par value; authorized - 350,000,000 shares; issued and outstanding -November 28, 1998, 139,201,141 shares and February 28, 1998, 138,087,946 shares 1,392 1,381 Additional paid-in capital 75,923 61,348 Retained earnings 295,815 232,668 -------- -------- Total shareholders' equity 373,130 295,397 -------- -------- $646,868 $458,330 ======== ========
See accompanying Notes to Consolidated Financial Statements. -3- 4 BED BATH & BEYOND INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA) (UNAUDITED)
Three Months Ended Nine Months Ended ----------------------------- ----------------------------- November 28, November 29, November 28, November 29, 1998 1997 1998 1997 ------------ ------------ ------------ ------------ Net sales $ 363,431 $ 280,978 $ 977,948 $ 761,535 Cost of sales, including buying, occupancy and indirect costs 214,958 165,556 577,353 449,255 ------------ ------------ ------------ ------------ Gross profit 148,473 115,422 400,595 312,280 Selling, general and administrative expenses 108,319 84,696 297,937 233,974 ------------ ------------ ------------ ------------ Operating profit 40,154 30,726 102,658 78,306 Interest income 761 714 2,149 1,855 ------------ ------------ ------------ ------------ Earnings before provision for income taxes 40,915 31,440 104,807 80,161 Provision for income taxes 16,264 12,497 41,661 31,864 ------------ ------------ ------------ ------------ Net earnings $ 24,651 $ 18,943 $ 63,146 $ 48,297 ============ ============ ============ ============ Net earnings per share - Basic $ 0.18 $ 0.14 $ 0.46 $ 0.35 Net earnings per share - Diluted $ 0.17 $ 0.13 $ 0.44 $ 0.34 Weighted average shares outstanding - Basic 138,971,762 137,813,970 138,667,458 137,558,418 Weighted average shares outstanding - Diluted 143,079,852 142,473,058 142,921,542 142,036,003
See accompanying Notes to Consolidated Financial Statements. -4- 5 BED BATH & BEYOND INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS, UNAUDITED)
Nine Months Ended --------------------------- November 28, November 29, 1998 1997 ------------ ------------ Cash Flows from Operating Activities: Net earnings $ 63,146 $ 48,297 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 16,642 13,147 Deferred income taxes (3,533) (2,050) Increase in assets: Merchandise inventories (131,392) (116,736) Prepaid expenses and other current assets (5,194) (672) Other assets (1,279) (1,027) Increase (decrease) in liabilities: Accounts payable 98,636 68,885 Accrued expenses and other current liabilities 11,587 21,920 Income taxes payable (2,195) (4,425) Deferred rent 2,777 2,627 --------- --------- Net cash provided by operating activities 49,195 29,966 --------- --------- Cash Flows from Investing Activities: Capital expenditures (42,512) (34,206) --------- --------- Net cash used in investing activities (42,512) (34,206) --------- --------- Cash Flows from Financing Activities: Proceeds from exercise of stock options 14,587 5,873 --------- --------- Net cash provided by financing activities 14,587 5,873 --------- --------- Net increase in cash and cash equivalents 21,270 1,633 Cash and cash equivalents: Beginning of period 53,280 38,765 --------- --------- End of period $ 74,550 $ 40,398 ========= =========
See accompanying Notes to Consolidated Financial Statements. -5- 6 BED BATH & BEYOND INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1) BASIS OF PRESENTATION The accompanying consolidated financial statements, except for the February 28, 1998 consolidated balance sheet, have been prepared without audit. In the opinion of Management, the accompanying consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position of Bed Bath & Beyond Inc. and subsidiaries (the "Company") as of November 28, 1998 and February 28, 1998 and the results of their operations for the three months and nine months ended November 28, 1998 and November 29, 1997, respectively, and their cash flows for the nine months ended November 28, 1998 and November 29, 1997. Because of the seasonality of the specialty retailing business, operating results of the Company on a quarterly basis may not be indicative of operating results for the full year. The accompanying unaudited consolidated financial statements are presented in accordance with the requirements for Form 10-Q and consequently do not include all the disclosures normally required by generally accepted accounting principles. Reference should be made to Bed Bath & Beyond Inc.'s Annual Report for the fiscal year ended February 28, 1998 for additional disclosures, including a summary of the Company's significant accounting policies. 2) STOCK SPLIT In June 1998, the Board of Directors approved a two-for-one split of the Company's common stock effected in the form of a stock dividend. The stock dividend was distributed on July 31, 1998 to shareholders of record on July 10, 1998. Accordingly, all shareholders' equity, share and per share amounts for all periods presented have been retroactively adjusted to give effect to the stock split. In June 1998, the Company's Certificate of Incorporation was amended to increase the number of authorized shares of common stock (par value $.01 per share) from 150,000,000 shares to 350,000,000 shares. -6- 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Three Months November 28, 1998 vs. Three Months November 29, 1997 Net sales for the third quarter ended November 28, 1998 were $363.4 million, an increase of $82.5 million or approximately 29.3% over net sales of $281.0 million for the corresponding quarter last year. Approximately 73.6% of the increase was attributable to new store net sales. The increase in comparable store net sales in the third quarter of 1998 was approximately 8.8%. The increase in comparable store net sales reflects a number of factors, including but not limited to, the continued consumer acceptance of the Company's merchandise offerings and customer service and the generally favorable retailing environment. Approximately 55% and 45% of net sales for the third quarter were attributable to sales of domestics merchandise and home furnishings merchandise, respectively. Gross profit for the third quarter of 1998 was $148.5 million or 40.9% of net sales compared with $115.4 million or 41.1% of net sales during the third quarter of 1997. The decrease in gross profit, as a percentage of net sales, was primarily attributable to an increase in coupons redeemed associated with the Company's marketing program. Selling, general and administrative expenses ("SG&A") were $108.3 million in the third quarter of 1998 compared with $84.7 million in the same quarter last year and as a percentage of net sales were 29.8% and 30.1%, respectively. The decrease in SG&A, as a percentage of net sales, primarily reflects a relative decrease in payroll and payroll related items. Operating profit in the third quarter of 1998 increased to $40.2 million from $30.7 million in the third quarter of 1997, reflecting primarily the increase in net sales and decrease in SG&A, which was partially offset by an increase in costs of sales. Nine Months November 28, 1998 vs. Nine Months November 29, 1997 Net sales for the nine months ended November 28, 1998 were $977.9 million, an increase of $216.4 million or approximately 28.4% over net sales of $761.5 million for the corresponding period last year. Approximately 80.1% of the increase was attributable to new store net sales. The increase in comparable store net sales for the first nine months of 1998 was approximately 6.2%. Gross profit for the first nine months of 1998 was $400.6 million or 41.0% of net sales compared with $312.3 million or 41.0% of net sales during the same period last year. SG&A was $297.9 million in the first nine months of 1998 compared with $234.0 million for the same period last year and as a percentage of net sales were 30.5% and 30.7%, respectively. The decrease in SG&A, as a percentage of net sales, primarily reflects a relative decrease in payroll and payroll related items. Operating profit in the first nine months of 1998 increased to $102.7 million from $78.3 million for the same period last year, primarily resulting from the increase in net sales and decrease in SG&A. -7- 8 EXPANSION PROGRAM 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 replacement of existing stores with larger stores. As a result of this program, the total number of stores has increased to 185 stores at the end of the third quarter of 1998 compared with 141 stores at the end of the corresponding quarter last year. Total square footage grew to 7,653,000 square feet at the end of the third quarter of 1998, from 5,767,000 square feet at the end of the third quarter of last year. During the first nine months of fiscal 1998, the Company opened 44 new superstores and expanded three stores resulting in an aggregate addition of 1,886,000 square feet to total store space. The Company anticipates opening one new store during the remainder of fiscal 1998. FINANCIAL CONDITION Total assets at November 28, 1998 were $646.9 million compared with $458.3 million at February 28, 1998, an increase of $188.5 million. Of the total increase, $157.9 million represented an increase in current assets and $30.7 million represented an increase in non-current assets. The increase in current assets was primarily attributable to an increase in merchandise inventories, which resulted from new store space. Total liabilities at November 28, 1998 were $273.7 million compared with $162.9 million at February 28, 1998, an increase of $110.8 million. The increase was primarily attributable to a $98.6 million increase in accounts payable (resulting from an increase in inventories) and a $11.6 million increase in accrued expenses and other current liabilities. Shareholders' equity was $373.1 million at November 28, 1998 compared with $295.4 million at February 28, 1998. The increase primarily reflects net earnings for the first nine months of fiscal 1998 and additional paid-in capital from the exercise of stock options. Capital expenditures for the first nine months of fiscal 1998 were $42.5 million compared with $34.2 million for the corresponding period last year. The increase is primarily attributable to furniture and fixtures and leasehold improvements for the 44 new superstores opened and three stores expanded during the first nine months compared to furniture and fixtures and leasehold improvements for the 33 new superstores opened and three stores expanded in the same period last year. YEAR 2000 During fiscal 1997, the Company conducted an extensive review of its computer systems and operations to identify the areas that could be affected by the Year 2000 issue. A plan was developed which focuses on the Company's information systems and third-party relationships. With respect to its own information systems, the Company has adopted a five-phase Year 2000 program consisting of: Phase I -- identification and ranking of the components of the Company's systems that may be vulnerable to Year 2000 problems; Phase II -- assessment of items identified in Phase I; Phase III -- remediation or replacement of non-compliant systems and components; Phase IV -- testing of systems and components following remediation; and Phase V -- developing contingency plans to address the most reasonably likely worst case Year 2000 scenarios. The Company has completed Phases I, II, and III, has substantially completed Phase IV, and is in the process of developing contingency plans for Phase V. -8- 9 With respect to its third-party relationships, the Company contacted its largest suppliers, vendors, and service providers to assess their state of Year 2000 readiness. This process is effectively complete and the Company is in the process of contingency planning to address the most reasonably likely worst case Year 2000 scenarios with respect to its third-party relationships, including developing alternate third-party relationships, if necessary. Potential sources of risk include the inability of principal suppliers to be Year 2000 compliant, which could result in delays in product deliveries from such suppliers, and disruption of the Company's distribution channel. Based on the efforts to date, the Company does not believe that the Year 2000 issue will have a material adverse effect on its financial condition or results of operations. The Company's costs incurred to date associated with the Year 2000 issue are not material. The Company estimates that the costs to complete its five-phase program, excluding any costs that may be incurred by the Company as a result of the failure of any third-parties to become Year 2000 compliant, will also not be material. The Company believes that by the end of fiscal 1998, it will have developed contingency plans to address its most reasonably likely worst case Year 2000 scenarios. FORWARD LOOKING STATEMENTS This Form 10-Q may contain forward looking statements. Important factors which may affect these statements are contained in the Company's Annual Report to shareholders for the fiscal year ended February 28, 1998. -9- 10 PART II - OTHER INFORMATION Item 5. Other Information On December 17, 1998, the Board of Directors adopted amendments to the Company's By-Laws, including amendments permissible as a result of recent changes in the New York Business Corporation Law. The By-Law amendments, among other changes, provide for shareholder meeting rules, and increase the minimum number of days by which shareholders must give notice for business properly to be brought before a shareholder meeting. The By-Laws of the Company, as amended, are being filed as an exhibit to this Report. Item 6. Exhibits and Reports on Form 8-K (a) The exhibits to this report are listed on the Exhibit Index included elsewhere herein. (b) No reports on Form 8-K were filed by the Company during the three month period ended November 28, 1998. Pursuant to the requirements 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. BED BATH & BEYOND INC. (Registrant) Date: January 11, 1999 By: /s/ Ronald Curwin ------------------------------------- Ronald Curwin Chief Financial Officer and Treasurer -10- 11 EXHIBIT INDEX ----------------------------------------------
Exhibit No. Exhibit Page No. - ----------- ------- -------- 3.1 Amended By-Laws of Bed Bath & Beyond Inc. 12-23 (As amended through December 17, 1998) 10.1 Fifth Amendment to the Credit Agreement 24-36 among the Company, bed 'n bath Stores, Inc., BBBL, Inc., Bed Bath & Beyond of California Limited Liability Company, BBBY Management Corporation and The Chase Manhattan Bank, dated October 26, 1998 10.2 Second Amended and Restated Revolving Credit 37-38 Note among the Company, bed 'n bath Stores, Inc., BBBL, Inc., Bed Bath & Beyond of California Limited Liability Company, BBBY Management Corporation and The Chase Manhattan Bank, dated October 26, 1998 27 Financial Data Schedule 39 (Filed electronically with SEC only)
-11- EX-3.1 2 AMENDED BY-LAWS 1 AMENDED BY-LAWS* OF BED BATH & BEYOND INC. (a New York Corporation) ARTICLE I - OFFICES The Corporation may have such offices within and without the State of New York as the Board of Directors may from time to time determine or the business of the Corporation may require. ARTICLE II - MEETINGS OF SHAREHOLDERS SECTION 1. PLACE OF MEETINGS. All meetings of the shareholders shall be held at such place within or without the State of New York as the Board of Directors may from time to time determine. SECTION 2. ANNUAL MEETINGS. The annual meeting of the shareholders for the election of directors and for the transaction of such other business as may properly be brought before the meeting shall be held on such date and at such hour as shall from time to time be fixed by the Board of Directors. The Board of Directors acting by resolution may postpone and reschedule any previously scheduled annual meeting of shareholders. SECTION 3. SPECIAL MEETINGS. Special meetings of the shareholders for any purpose or purposes shall be called and may be held at any time upon the written request of the Board of Directors, the Chairman or the President. Any such request shall state the purpose or purposes of the proposed meeting. The business transacted at any special meeting shall be confined to the purposes stated in the notice of the meeting. The Board of Directors acting by resolution may postpone and reschedule any previously scheduled special meeting of shareholders. SECTION 4. NOTICE OF MEETINGS. Written notice of each annual and special meeting of shareholders shall state the date, time, place and purpose or purposes of each such meetings of shareholders and, unless it is the annual meeting, shall indicate that it is being issued at the direction of the person or persons requesting the meeting. SECTION 5. FIXING RECORD DATE. For the purpose of determining the shareholders - -------- * As amended through December 17, 1998 -12- 2 entitled to notice of or to vote at any meeting of the shareholders or any adjournment thereof, or to express consent to or dissent from any taking of corporate action without a meeting, or for the purpose of determining shareholders entitled to receive payment of any dividend or other distribution or the allotment of any rights, or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a date as the record date for any such determination of shareholders. Such date shall not be less than ten (10) nor more than sixty (60) days before the date of any such meeting, nor more than sixty (60) days before any other action. When a determination of shareholders of record entitled to notice of or to vote at any meeting of shareholders has been made as provided in this Section 4, such determination shall apply to any adjournment thereof, unless the Board of Directors fixes a new record date for the adjourned meeting or further notice is required by statute. If no record date is fixed, it shall be determined by statute. SECTION 6. QUORUM. Unless otherwise provided by statute or by the Certificate of Incorporation, the holders of a majority of the votes of shares issued and outstanding and entitled to vote thereat, represented in person or by proxy, shall constitute a quorum at any meeting of shareholders for the transaction of business. When a quorum is once present to organize a meeting, it shall not be broken by the subsequent withdrawal of any shareholders. At any time a quorum is not present at a meeting of the shareholders, a majority of the shareholders present in person or by proxy and entitled to vote thereat may adjourn the meeting from time to time, without notice other than an announcement at the meeting of the place, date and hour of the adjourned meeting, until a quorum shall be present, and at the adjourned meeting at which a quorum is present any business may be transacted that might have been transacted at the meeting as originally called. SECTION 7. WAIVERS. Notice of meeting need not be given to any shareholder who signs and submits a waiver of notice, in person or by proxy, whether before or after the meeting. The attendance of any shareholder at a meeting, in person or by proxy, without protesting prior to the conclusion of the meeting the lack of notice of such meeting shall constitute a waiver of notice by such shareholder. SECTION 8. PROXIES. Every shareholder entitled to vote at a meeting of shareholders or to express consent or dissent without a meeting may authorize another person or other persons to act for him or her by proxy, in the manner and to the extent provided by statute. SECTION 9. QUALIFICATION OF VOTERS. Every shareholder of record shall be entitled at every meeting of the shareholders to one vote for each share standing in his or her name on the record of shareholders of the Corporation, unless otherwise provided by statute, by the Certificate of Incorporation or by these By-laws. SECTION 10. ORDER OF BUSINESS. For business properly to be brought before a meeting by a shareholder (including, without limitation, the nomination of a person or persons to the Board of Directors), the shareholder must have given timely notice thereof in proper written form -13- 3 to the Secretary of the Corporation. To be timely, a shareholder's notice must be delivered to or mailed and received at the principal executive offices of the Corporation (a) in the case of an annual or special meeting of shareholders, not fewer than sixty (60) days or more than ninety (90) days prior to the meeting at which such business will be considered; provided, however, that, if fewer than sixty (60) days' notice or prior public disclosure of the date of the meeting is given or made to shareholders, notice by the shareholder to be timely must be received not later than the close of business on the earlier of (i) the tenth day following the day on which such notice of the date of the meeting was mailed or such public disclosure was made or (ii) the last business day prior to the meeting date; and (b) in the case of an annual meeting of shareholders, not fewer than sixty (60) days in advance of the date of the previous year's annual meeting of shareholders. To be in proper written form, a shareholder's notice to the Secretary shall set forth in writing as to each matter the shareholder proposes to bring before the meeting: (w) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting; (x) the name and address, as they appear on the Corporation's books, of the shareholder proposing such business; (y) the class and number of shares of the Corporation that are held of record and that are beneficially owned by such shareholder; and (z) any material interest of such shareholder in such business. If the business proposed to be brought before the meeting by a shareholder involves the nomination of a person or persons to the Board of Directors, the notice to the Secretary also shall set forth all the information relating to the person or persons that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, pursuant to Regulation 14A under the Securities Exchange Act of 1934. Notwithstanding anything else in these By-laws to the contrary, no business shall be conducted at a meeting of shareholders that contravenes the procedures set forth in this Section 10. The chairman of a meeting shall, if the facts warrant, determine that business was not properly brought before the meeting in accordance with the provisions of this Section 10 and, if the chairman of the meeting should so determine, any such business not properly brought before the meeting shall not be transacted and a declaration to such effect shall be made to the meeting. The Board of Directors of the Company shall be entitled to make such rules or regulations for the conduct of meetings of shareholders as it shall deem necessary, appropriate or convenient. Subject to such rules and regulations of the Board of Directors, if any, the chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are necessary, appropriate or convenient for the proper conduct of the meeting, including, without limitation, establishing an agenda or order of business for the meeting, rules and procedures for maintaining order at the meeting and the safety of those present, limitations on participation in such meeting to shareholders of record of the Company and their duly authorized and constituted proxies, and such other persons as the Chairman shall permit, restrictions on entry to the meeting after the time fixed for the commencement thereof, limitations on the time allotted to questions or comment by participants and regulation of the opening and closing of the polls for balloting on matters which are to be voted on by ballot. Unless, and to the extent, otherwise determined by the Board of Directors or the chairman of the meeting, meetings of shareholders shall not be required to be held in accordance with rules of parliamentary procedure. -14- 4 SECTION 11. VOTING. Unless otherwise provided by statute or by the Certificate of Incorporation, all elections for directors shall be determined by a plurality of the votes cast, whether in person or by proxy, at a meeting of shareholders by the holders of shares entitled to vote in the election, and all other corporate action shall be by a majority of the votes properly cast at a meeting of shareholders, whether in person or by proxy. All voting for the election of directors shall be by ballot. SECTION 12. LIST OF SHAREHOLDERS. A list of shareholders as of the record date, certified by the corporate officer responsible for its preparation or by a transfer agent, shall be produced at any meeting upon the request thereat or prior thereto of any shareholder. If the right to vote at any meeting is challenged, the inspectors of the election, or person presiding thereat, shall require such list of shareholders to be produced as evidence of the right of the persons challenged to vote at such meeting, and all persons who appear from such list to be shareholders entitled to vote thereat may vote at such meeting. SECTION 13. INSPECTORS OF ELECTION. Prior to the holding of each annual or special meeting of the shareholders, one or more inspectors of election to serve thereat shall be appointed by the Board of Directors, or, if the Board shall not have made such appointment, by the Chairman of the Board or the President. If there shall be a failure to appoint an inspector, or if, at any such meeting, the inspector or inspectors so appointed shall be absent or shall fail to act or the office shall become vacated, the chairman of the meeting may, and at the request of a shareholder present in person and entitled to vote at such meeting shall, appoint such inspector or inspectors of election to act thereat. The inspector or inspectors of election so appointed to act at any meeting of the shareholders, before entering upon the discharge of their duties, shall be sworn faithfully to execute the duties of inspector at such meeting, with strict impartiality and according to the best of his or her ability, and the oath so taken shall be subscribed by such inspector. Such inspector or inspectors of election shall take charge of the polls, and, after the voting on any question, shall make a certificate of the results of the vote taken. No director or candidate for the office of director shall act as an inspector of an election of directors. Inspectors need not be shareholders. ARTICLE III - BOARD OF DIRECTORS SECTION 1. NUMBER, QUALIFICATION AND TERM OF OFFICE. The business of the Corporation shall be managed under the direction of the Board of Directors. The number of directors that shall constitute the whole Board of Directors shall be fixed exclusively by one or more resolutions adopted by the Board of Directors. The directors need not be residents of the State of New York and need not be shareholders. No decrease in the number of directors shall shorten the term of an incumbent director. Members of the Board of Directors shall be elected at each annual meeting of shareholders in accordance with and subject to the provisions of the Certificate of Incorporation. Directors so elected shall serve until their successors have been elected and qualified -15- 5 or until an earlier resignation, removal or other displacement from office as provided in these By-laws. SECTION 2. PLACE OF MEETINGS. The Board of Directors may hold its meetings, regular or special, at such place or places, within or without the State of New York, as the Board of Directors may from time to time determine or as may be specified in the notice of any meeting. SECTION 3. ANNUAL MEETINGS. An annual meeting of the Board of Directors shall be held following the annual meeting of the shareholders for the purposes of electing officers of the Corporation and the committees of the Board of Directors and transacting any other business which may properly come before the meeting. Notice of annual meetings of the Board of Directors need not be given in order legally to constitute the meeting, provided a quorum shall be present. SECTION 4. REGULAR MEETINGS. Regular meetings of the Board of Directors shall be held at times and dates fixed by the Board or at such other times and dates as the Chairman or President shall determine and as shall be specified in the notice of such meetings. Notice of regular meetings of the Board of Directors need not be given except as otherwise required by statute or these By-laws. SECTION 5. SPECIAL MEETINGS. Special meetings of the Board of Directors may be called by the Secretary of the Corporation upon the written request of the Chairman or President or any two directors. SECTION 6. NOTICE OF MEETINGS. Notice of each special meeting of the Board of Directors (and of each regular meeting for which notice shall be required) shall be given by the Secretary as hereinafter provided in this Section 6, which notice shall state the time, place and, if required by statute or these By-laws, the purposes of such meeting. Notice of each such meeting shall be mailed, postage thereon prepaid, to each director, by first-class mail, at least four days before the day on which such meeting is to be held, or shall be sent by facsimile transmission or comparable medium, or be delivered personally or by telephone, at least twenty-four hours before the time at which such meeting is to be held. Any meeting of the Board of Directors shall be a legal meeting without notice thereof having been given, if all the directors of the Corporation then holding office shall be present thereat. SECTION 7. WAIVERS. Notice of a meeting need not be given to any director who signs a waiver of notice, whether before or after the meeting. The attendance of any director at a meeting without protesting prior to the meeting or at its commencement the lack of notice of such meeting, shall constitute a waiver of notice by such director. SECTION 8. QUORUM. Unless otherwise provided by statute, the Certificate of Incorporation or these By-laws, a majority of the entire Board of Directors shall constitute a quorum -16- 6 for the transaction of business or of any specified item of business. At any time a quorum is not present at a meeting of the Board of Directors, a majority of the directors participating may adjourn the meeting from time to time until a quorum shall be present thereat; and notice of any adjournment to another time or place shall be given to the directors who were absent at the time of the adjournment and, unless the new time and place are announced at the meeting to be adjourned, to the other directors. SECTION 9. MEETING PARTICIPATION WITHOUT PHYSICAL PRESENCE. Any one or more members of the Board of Directors or of any committee thereof may participate in a meeting of the Board of Directors or of such committee by means of conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time. Participation by such means shall constitute presence in person at a meeting. SECTION 10. ACTION OF THE BOARD. Unless otherwise provided by statute, the Certificate of Incorporation or these By-laws, the vote of a majority of the directors at any meeting at which a quorum is present shall be the act of the Board of Directors. Each director shall have one vote regardless of the number of shares, if any, which he or she may hold. SECTION 11. ACTION BY CONSENT WITHOUT A MEETING. Any action required or permitted to be taken by the Board of Directors or any committee thereof may be taken without a meeting if all members of the Board or of such committee consent in writing to the adoption of a resolution authorizing such action. The written consent or consents to each such action, including the resolutions adopted thereby, shall be filed with the minutes of the proceedings of the Board of Directors or of the committee taking such action. SECTION 12. EXECUTIVE AND OTHER COMMITTEES. The Board of Directors, by resolution adopted by a majority of the entire Board, may designate from among its members an executive committee and other committees, each consisting of one (1) or more directors, and each of which shall have all the authority of the Board of Directors to the extent provided in the resolution, except as otherwise provided by statute. Each such committee shall serve at the pleasure of the Board of Directors and shall keep minutes of its meetings and report the same to the Board of Directors as and when requested by the Board and shall observe such other procedures with respect to its meetings as are provided in these By-laws or, to the extent not provided herein, as may be provided by the Board of Directors in the resolution appointing such committee or as may be adopted by the Board of Directors thereafter. SECTION 13. REMOVAL. Unless otherwise provided by statute, any or all directors may be removed for cause by vote of the shareholders or by action of the Board of Directors at a special meeting called for that purpose. SECTION 14. RESIGNATION. Any director may resign at any time by giving written notice to the Board of Directors, the President or the Secretary of the Corporation. Unless otherwise -17- 7 specified in the notice, the resignation shall take effect upon receipt thereof by the Board of Directors or such officer, and acceptance of the resignation shall not be necessary to make it effective. SECTION 15. NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Newly created directorships resulting from an increase in the number of directors and vacancies occurring in the Board of Directors for any reason shall be filled in accordance with and subject to the provisions of the Certificate of Incorporation. SECTION 16. COMPENSATION. The Board of Directors, by resolution and irrespective of any personal interest of any of its members, shall have the authority to establish reasonable compensation and fix reimbursement for reasonable expenses of all directors for their services to the Corporation as directors, officers or otherwise. ARTICLE IV - OFFICERS SECTION 1. OFFICERS. The officers of the Corporation shall include the Chairman, the President, one or more Vice Presidents (one or more of whom may be designated as Executive Vice Presidents or as Senior Vice Presidents or by other designations), the Secretary, the Treasurer and such other officers as the Board of Directors may from time to time deem necessary, each of whom shall have such duties, powers and functions as provided in these By-laws and as may be determined from time to time by resolution of the Board of Directors. Two or more offices may be held by the same person; provided, however, that no officer shall execute, acknowledge or verify any instrument in more than one capacity. Each of the officers shall, when requested, consult with and advise the other officers of the corporation. SECTION 2. ELECTION OR APPOINTMENT AND TERM OF OFFICE. Each officer shall be elected or appointed by the Board of Directors to hold office until the next annual meeting of the Board of Directors and until his or her successor is elected or appointed and qualified, or until such earlier date as shall be prescribed by the Board of Directors at the time of his or her election or appointment or until an earlier resignation, removal or displacement from office. Any officer elected or appointed by the Board of Directors may be removed at any time, with or without cause, by vote of a majority of the Board of Directors. SECTION 3. VACANCIES. In the event of the resignation, removal or other displacement from office of an officer elected or appointed by the Board of Directors, the Board, in its sole discretion, may elect or appoint a successor to fill the unexpired term. SECTION 4. THE CHAIRMAN. The Chairman shall, together with the President, have general direction over the day-to-day business of the Corporation, subject to the control and direction of the Board of Directors. The Chairman shall, when present, preside as chairman at all -18- 8 meetings of the shareholders and of the Board of Directors. The Chairman shall, in the absence or incapacity of the President, perform all duties and functions and exercise all the powers of the President. The Chairman shall also have such other powers and perform such other duties required by statute or by these By-laws or as the Board of Directors may from time to time determine. SECTION 5. THE PRESIDENT. The President shall, together with the Chairman, have general direction over the day-to-day business of the Corporation, subject to the control and direction of the Board of Directors. In the absence of the Chairman, the President shall preside at meetings of the shareholders and of the Board of Directors. The President shall, in the absence or incapacity of the Chairman, perform all duties and functions and exercise all the powers of the Chairman. The President shall also have such other powers and perform such other duties required by statute or by these By-laws or as the Board of Directors may from time to time determine. SECTION 6. VICE PRESIDENTS. Each Vice President shall have such powers and perform such duties as from time to time may be assigned to him or her by the Board of Directors or be delegated to him or her by the Chairman or by the President. In the absence or inability to perform of the Chairman and the President, the Vice President (or if there is more than one Vice President, then the Executive Vice President) shall have all the powers and functions of the President. SECTION 7. TREASURER. The Treasurer shall have the safekeeping and custody of the corporate funds and other valuable effects, including securities, shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation, and shall deposit all money and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. The Treasurer shall disburse the funds of the Corporation under the direction of the President or the Chairman, taking proper vouchers for such disbursements, and render to the President and the Chairman at the annual and regular meetings of the Board of Directors, or whenever the President or the Chairman require it, an account of all transactions as Treasurer and of the financial condition of the Corporation. The Treasurer shall make a full financial report at the annual meeting of shareholders. The Treasurer shall also have such other powers and perform such other duties incident to the office of Treasurer required by statute or by these By-laws or as the Board of Directors may from time to time determine. SECTION 8. SECRETARY. The Secretary shall keep or cause to be kept in one or more books provided for such purpose, the minutes of all meetings of the Board of Directors, shareholders and committees of the Board of Directors, see that all notices are duly given in accordance with the provisions of these By-laws and as required by law and see that the books, reports, statements, certificates and other documents and records required by law to be kept and filed are properly kept and filed. The Secretary shall also have such other powers and perform such other duties incident to the office of Secretary required by law or by these By-laws or as the Board of Directors may from time to time determine. -19- 9 SECTION 9. DESIGNATED OFFICERS. (a) Chief Executive Officer. Either the Chairman or the President, or both, as the Board of Directors may designate, shall be the Chief Executive Officer of the Corporation. The officer so designated shall have, in addition to the powers and duties applicable to his or her office set forth in this Article IV, general and active supervision and direction over the business and affairs of the Corporation and over its several officers, agents and employees, subject, however, to the control of the Board of Directors. The Chief Executive Officer shall also have such other powers and duties incident to the designated position of Chief Executive Officer as the Board of Directors may from time to time determine. Any reference to the Chief Executive Officer in these By-laws shall be deemed to mean, if there is a Co-Chief Executive Officer, either Co-Chief Executive Officer, each of whom may exercise the full powers and authorities of the designated position of Chief Executive Officer. (b) Other Designated Officers. The Board of Directors may from time to time designate officers to serve as Chief Financial Officer, Chief Accounting Officer and other such designated positions and to fulfill the responsibilities of such designated positions in addition to the powers and duties applicable to his or her office as set forth in this Article IV. Such designated officers shall also have such other powers and duties incident to his or her designated position as the Board of Directors may from time to time determine. SECTION 10. COMPENSATION. The salaries and other compensation of all officers elected by the Board of Directors shall be fixed from time to time by or under the direction of the Board of Directors. ARTICLE V - INDEMNIFICATION OF DIRECTORS AND OFFICERS The Corporation shall, to the fullest extent permitted by applicable law as in effect at any time, indemnify any director (and may indemnify any officer) made, or threatened to be made, a party to an action or proceeding, whether civil or criminal, including an action by or in the right of any other corporation of any type or kind, domestic or foreign, or any partnership, joint venture, trust, employee benefit plan or other enterprise, which any director or officer of the Corporation served in any capacity at the request of the Corporation, by reason of the fact that he or she, his or her testator or intestate, was a director or officer of the corporation, or served such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity, against judgments, fines, amounts paid in settlement and reasonable expenses, including reasonable attorneys' fees incurred as a result of such action or proceeding, or any appeal therein; provided that to the extent prohibited by applicable law no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that his or her acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that he or she personally gained in fact a financial profit or other advantage to which he or she was not legally entitled. The -20- 10 right to indemnification pursuant to this Article V is intended to be retroactive and shall, to the extent permitted by applicable law, be available with respect to events occurring prior to the adoption hereof and shall continue to exist after any future rescission or restrictive modification hereof with respect to any alleged cause of action that accrues, or any other incident or matter that occurs, prior to such rescission or modification. ARTICLE VI - SHARES SECTION 1. CERTIFICATES FOR SHARES. The certificates for shares of the Corporation shall be in such form as shall be determined by the Board of Directors, and shall be numbered and entered in the books of the Corporation as they are issued. Each certificate shall exhibit the registered holder's name, the number and class of shares, and the designation of any series, if any, that it evidences, and shall set forth such other statements as may be required by statute. Each certificate shall be signed by the Chairman or the President and by the Secretary or the Treasurer, any or all of whose signatures may be facsimile if such certificate is countersigned by a transfer agent or registered by a registrar. Each certificate may be sealed with the seal of the Corporation or a facsimile thereof. In case any one or more of the officers who have signed or whose facsimile signatures appear on any such certificate shall cease to be such officer or officers of the Corporation, whether because of resignation, removal or other displacement from office, before such certificate is issued and delivered, it may nonetheless be issued and delivered with the same effect as if such officer or officers had continued in office. SECTION 2. LOST, MUTILATED, STOLEN OR DESTROYED CERTIFICATES. The Board of Directors may direct a new certificate or new certificates be issued in place of any certificate theretofore issued by the Corporation alleged to have been lost, mutilated, stolen or destroyed. When authorizing such issue of a new certificate, the Board of Directors, in its discretion and as a condition precedent to the issuance thereof, may prescribe such terms and conditions as it deems expedient, and may require such indemnities as it deems adequate, to protect the Corporation from any claim that may be made against it with respect to any such certificate alleged to have been lost, mutilated, stolen or destroyed. SECTION 3. TRANSFER AGENT AND REGISTRAR; REGULATIONS. The Board of Directors may appoint transfer agents or registrars, or both, and may require all share certificates to bear the signature of either or both. The Board of Directors may make such additional rules and regulations as it may deem expedient concerning the issue, transfer and registration of certificates for shares of the Corporation. SECTION 4. TRANSFER OF SHARES. Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, the Corporation shall issue or cause the transfer -21- 11 agent to issue a new certificate to the person entitled thereto, shall cancel the old certificate and shall record such transfer upon the books of the corporation. SECTION 5. CANCELLATION OF CERTIFICATES. Each certificate for shares to be canceled shall be marked "CANCELED" across the face thereof by the Secretary, with the date of cancellation, and the transaction shall be immediately recorded in the certificate book opposite the memorandum of issue. The canceled certificate should be inserted thereafter in the certificate book. SECTION 6. CONTINGENT INTEREST IN SHARES. No entry shall be made in the books of the Corporation or on any certificate for shares that any person is entitled to any future, limited or contingent interest in any share. SECTION 7. UNCERTIFICATED SHARES. The Board of Directors may in its discretion authorize the issuance of shares which are not represented by certificates and provide for the registration and transfer thereof on the books and records of the Corporation or any transfer agent or registrar so designated. SECTION 8. SHAREHOLDER RECORDS. The names and addresses of the persons to whom shares are issued, and the number of shares and the dates of issue and any transfer thereof, whether in certificated or uncertificated form, shall be entered on records kept for that purpose. The stock transfer records and the blank stock certificates shall be kept by the transfer agent, or by the treasurer, or such other officer as shall be designated by the Board of Directors for that purpose. ARTICLE VII - GENERAL SECTION 1. FISCAL YEAR. The fiscal year of the Corporation shall be fixed and may from time to time be changed by resolution of the Board of Directors. SECTION 2. SEAL. The seal of the Corporation, if any, shall be circular in form and bear the name of the Corporation, the year of its organization and the words "Corporate Seal New York." The seal may be used by causing it or a facsimile thereof to be impressed, affixed or reproduced directly on the instrument or writing to be sealed. SECTION 3. INSTRUMENTS AND DOCUMENTS. All corporate instruments and documents shall be signed, countersigned, executed, verified or acknowledged by such officers or other person or persons as the Board of Directors may from time to time designate. SECTION 4. AMENDMENTS. These By-laws may be amended or repealed or new By-laws may be adopted by the shareholders at any annual or special meeting if the notice thereof mentions that amendment or repeal or the adoption of new By-laws is one of the purposes of such -22- 12 meeting; provided, however, that the provisions of the By-laws relating to the Board of Directors and meetings of shareholders may be amended or modified only by (i) the affirmative vote of the holders of at least 80% of voting power of all the then-outstanding shares of voting stock of the corporation entitled to vote at an election of directors, voting together as a single class, or (ii) the affirmative vote of a majority of the total number of directors then in office. These By-laws may also be amended or repealed or new By-laws may be adopted by the affirmative vote of a majority of the Board of Directors given at any meeting, if the notice thereof mentions that amendment or repeal or the adoption of new By-laws is one of the purposes of such meeting. If any By-laws relating to the election of directors or meetings of shareholders are amended, notice of such amendment shall be given to shareholders to the extent required by law. -23- EX-10.1 3 FIFTH AMENDMENT TO THE CREDIT AGREEMENT 1 FIFTH AMENDMENT TO CREDIT AGREEMENT THIS FIFTH AMENDMENT TO CREDIT AGREEMENT (this "Fifth Amendment") is made as of October 26, 1998, by and among BED BATH & BEYOND INC., a New York corporation (the "Company"), and BED-N-BATH STORES INC., a New Jersey corporation ("BNBS"), BBBL, INC., a Delaware corporation ("BBBL"), BED BATH & BEYOND OF CALIFORNIA LIMITED LIABILITY COMPANY, a Delaware limited liability company ("Calco"), and BBBY MANAGEMENT CORPORATION, a New Jersey corporation ("BBBY", and together with BNBS, BBBL and Calco, collectively, the "Guarantors" and individually, a "Guarantor," and the Guarantors together with the Company, collectively, the "Credit Parties"), and THE CHASE MANHATTAN BANK, a New York banking corporation ("Chase"). W I T N E S S E T H: WHEREAS, the Credit Parties and Chase are parties to that certain Credit Agreement dated as of October 26, 1994, as amended that certain First Amendment, dated as of October 1, 1995, as further amended by that certain Second Amendment, dated as of February 24, 1997, that certain Third Amendment, dated as of September 11, 1997 and that certain Fourth Amendment, dated as of September 19, 1997 (such Credit Agreement, as amended by the First Amendment, the Second Amendment, the Third Amendment and the Fourth Amendment, shall hereafter be known as, the "Credit Agreement"); and WHEREAS, the Credit Parties and Chase have agreed to further amend the Credit Agreement, to (i) extend the term of the revolving credit facility thereunder and eliminate the conversion option thereof to a term loan, (ii) eliminate the "L/C Commitment," and (iii) otherwise modify certain of the terms and provisions therein; NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the parties hereto hereby agree as follows: 1. MODIFICATION OF THE CREDIT AGREEMENT. The Credit Agreement is hereby amended in the following particulars, effective as of the date hereof: (A)(i) The following new or revised definitions are hereby inserted in Section 1.1 of the Credit Agreement (Defined Terms) as follows: "Applicable Margin": for each Type of Loan, the rate per annum under the relevant column heading below: Eurodollar COF Chase Rate Loan Loans Rate Loans - --------------- ----- ---------- -1.00% 0.50% 0.50% -24- 2 "Bank": means Chase (and "Chase" and "Bank" are used interchangeably throughout this Agreement). "Consolidated Adjusted Debt": at a particular date, Consolidated Funded Debt plus the product of eight (8) times Rental Payments. "Consolidated EBITDAR": for any period, the sum of (i) Consolidated Net Income plus (ii) Consolidated Interest Expense plus (iii) the income tax expense of the Company and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP plus (iv) the amount reported as the depreciation of the assets of the Company and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, as such item is used in the computation of Consolidated Net Income for such period plus (v) the amount reported as the amortization of Consolidated Intangibles of the Company and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, as such item is used in the computation of Consolidated Net Income for such period plus Rental Payments. "Consolidated Funded Debt": at a particular date, the sum of (i) the aggregate principal amount of all indebtedness outstanding as of such date that would appear as Indebtedness on a consolidated balance sheet of the Company and its Subsidiaries prepared as of such date in accordance with GAAP plus (ii) the aggregate principal amount outstanding of all consolidated Guarantee Obligations of the Company and its Subsidiaries as of such date plus (iii) obligations under Financing Leases. "Permitted Acquisitions": means the acquisition by any of the Credit Parties or any wholly owned Subsidiary of a Credit Party of all or substantially all of the capital stock, securities, assets or other ownership interests of any Person in any transaction or series of related transactions provided that (i) at the time of such acquisition, no Event of Default has occurred and is continuing or after giving effect to such acquisition would at the time of such acquisition occur; (ii) such Person, at the time of acquisition, engages in a substantially similar business (it being agreed that the term "substantially similar business" shall mean any retail business operating through any medium, including, without limitation, by operating stores, distributing catalogs, maintaining an internet "web page" or other on-line presence) in which the Company, any Credit Party or Subsidiary engages on the date hereof; (iii) at the time of such acquisition, the Credit Parties shall have provided to Chase financial projections (certified by the Company's chief financial officer), for the twelve (12) month period immediately subsequent to such acquisition, which projections shall show that after giving effect to such acquisition, the Credit Parties shall be in compliance with all the financial covenants and other provisions of this Agreement; (iv) the aggregate consideration paid for all such acquisitions throughout the term of this Agreement (including, without limitation, by payment in cash, issuance of capital stock, issuance of subordinated debt or assumption of Indebtedness) shall not exceed $100,000,000; (v) the proposed acquisition may not be "contested" by any Person; (vi) the proposed acquisition documents (including, without limitation, the stock or asset purchase agreement) shall have been provided to Chase at least fourteen (14) days prior to the date of the proposed consummation thereof; and (vii) Chase shall have been provided at least fourteen (14) days prior to the date of the proposed acquisition consolidated and consolidating financials of the Credit Parties prepared on a pro forma basis taking into account the proposed acquisition (certified as to accuracy by the Company by a certificate signed on the Company's behalf by its chief financial officer); -25- 3 provided, however, that if the aggregate consideration paid for such acquisitions does not exceed $20,000,000, the provisions of clause (ii) shall not be applied in determining whether same constitutes a Permitted Acquisition. "Rental Payments": means for each four-quarter period ending on the last day of the accounting period covered by the consolidated financial statements of the Company and its Subsidiaries, and delivered pursuant to this Agreement, the dollar amount of the fixed payments which the Company or its Subsidiaries are required to make by terms of any lease to its landlords during such four-quarter period, (a) excluding, however, (i) rentals under Financing Leases, and (ii) maintenance, repairs, taxes and other similar charges included in such payments and (b) less (x) rental income and (y) amortization of gains on sale-leasebacks. "Termination Date": means October 26, 2001. (ii) The following definitions in Section 1.1 of the Credit Agreement are hereby deleted: "L/C Commitment" "Term-out Loan" "Term-out Note" (iii) All references to the "Credit Parties" in the Credit Agreement are deemed to mean the Credit Parties as defined in this Fifth Amendment; all references to the "Revolving Credit Note(s)" or the "Note(s)" in the Credit Agreement are deemed to mean the Second Amended and Restated Revolving Credit Note, dated as of October 26, 1998 (the "1998 Note"); and all references to the "Obligations" in the Credit Agreement are deemed to include, along with the other obligations set forth therein, all obligations of the Credit Parties to the Bank under the 1998 Note. (B) The reference to "October 1, 1995" in the last sentence of Section 2.2 of the Credit Agreement (Revolving Credit Notes) is hereby amended to read: "October 26, 1998." (C) Section 2.4 of the Credit Agreement (Commitment Fee) is hereby amended and restated in its entirety to read as follows: "2.4. Commitment Fee. The Company agrees to pay to Chase a commitment fee for the period from and including October 26, 1998 to the Termination Date, computed at the rate of 1/8% of 1% per annum on the average daily amount of the aggregate Available Revolving Credit Commitment, during the period for which payment is made, payable quarterly, in arrears on the last day of each March, June, September and December and on the Termination Date or such earlier date as the Revolving Commitment shall terminate as provided herein, commencing on the first of such dates to occur after the date hereof." (D) Sections 2.6 and 2.7 and any and all other provisions dealing with the Term-out Loan and the Term-out Note(s) are hereby deleted from the Credit Agreement in their entirety. -26- 4 (E) The first sentence of Section 3.1(a) of the Credit Agreement (L/C Commitment) is hereby amended by deleting clause (i) thereof so that the proviso will hereby read as follows: "provided that Chase shall have no obligation to issue any Letter of Credit if, after giving effect to such issuance, the Available Revolving Credit Commitment would be less than zero." (F) Section 3.1(b) of the Credit Agreement (L/C Commitment) is hereby amended so that the references to "the State of New Jersey" is amended to read: "the State of New York." (G) Section 6 of the Credit Agreement (Representations and Warranties) is hereby amended as follows: (i) Section 6.2 of the Credit Agreement (No Change) is hereby amended by inserting the phrase "to the best of the Company's knowledge," at the beginning of clause (a) on the 3rd and 4th lines thereof. (ii) Section 6.3 of the Credit Agreement (Corporate Existence; Compliance with Law) is hereby amended by deleting the proviso in clause (d), so that clause (d) will read as follows: "(d) is in compliance with Requirements of Law except to the extent that the failure to comply therewith could not, in the aggregate, have a Material Adverse Effect." (iii) Section 6.7 of the Credit Agreement (No Default) s hereby amended by deleting the second sentence thereof in its entirety. (iv) Section 6.11 of the Credit Agreement (Taxes) is hereby amended by adding the words "which could have a Material Adverse Effect" to the end thereof after the word "charge." (v) Section 6.15 of the Credit Agreement (Subsidiaries) is hereby amended by deleting the first sentence thereof and by replacing the word "Guarantors" with the words "Credit Parties." -27- 5 (H) Section 6 of the Credit Agreement (Representations and Warranties) is hereby amended to add the following new Section 6.18 as follows: "6.18 Year 2000. To the best of the Company's knowledge, any reprogramming required to permit the proper functioning, in and following the year 2000, of (i) the Company's and its Subsidiaries' computer systems and (ii) equipment containing embedded microchips (including systems and equipment supplied by others or with which Company's and its Subsidiaries' system interface) and the testing of all such systems and equipment, as so reprogrammed, will be completed on or prior to the end of the second fiscal quarter of 1999. To the best of the Company's knowledge, the cost to the Company and its Subsidiaries of such reprogramming and testing and of the reasonably foreseeable consequences of year 2000 to the Company and its Subsidiaries (including, without limitation, reprogramming errors and the failure of others' systems or equipment) will not result in a Default, Event of Default, or a Material Adverse Effect. Except for such of the reprogramming referred to in the preceding sentence as may be necessary, to the best of the Company's knowledge, the computer and management information systems of the Company and its Subsidiaries are and, with ordinary course upgrading and maintenance, will continue for the term of this Agreement to be, sufficient to permit each of the Company and its Subsidiaries to conduct its business without Material Adverse Effect." (I) Section 9.1(a) of the Credit Agreement (Maintenance of Current Ratio) is hereby deleted in its entirety and is replaced by the following: "(a) Maintenance of Cash Flow Leverage. Permit the ratio of Consolidated Adjusted Debt at the end of any fiscal quarter to Consolidated EBITDAR for the period of four (4) consecutive fiscal quarters ending on such date to be greater than 3.50 to 1.00." (J) Section 9.1(b) of the Credit Agreement (Maintenance of Tangible Net Worth) is hereby amended and restated in its entirety to read as follows: "(b) Maintenance of Tangible Net Worth. Permit the Consolidated Tangible Net Worth of the Company at any time during any fiscal quarter to be less than the sum of (x) $277,125,000 less the amount of any declared but unpaid dividends described in Section 9.9 plus (y) 50% of cumulative Consolidated Net Income for the prior fiscal year then ended." (K) Section 9.3 of the Credit Agreement (Adjusted Senior Debt/TNW) is hereby deleted in its entirety to read as follows: "Intentionally Omitted." (L) Section 9.4 of the Credit Agreement (Limitation on Indebtedness) is hereby amended and restated in its entirety to read as follows: "9.4 Limitation on Indebtedness. Create, incur, assume or suffer to exist any Indebtedness, except: (a) Indebtedness in respect of the Loans, the Note, the Letter of Credit and other obligations of the Company under this Agreement; -28- 6 (b)(i) Indebtedness of any Credit Party (A) to any other Credit Party or (B) consisting of Indebtedness of the Company which is subordinated to the Loans on terms reasonably satisfactory to Chase, and (ii) Indebtedness of any Credit Party or any of their respective Subsidiaries to the Company or the Guarantors. (c) Indebtedness of the Credit Parties and their Subsidiaries in an aggregate principal amount not exceeding as to the Credit Parties and their respective Subsidiaries $40,000,000 at any time outstanding. The amount permitted in this subsection 9.4(c) shall not be in addition to that amount permitted under Sections 9.6 and 9.14 but shall be cummulative with such amount so that the total amount of Indebtedness, direct or contingent, or sale/leaseback transactions permitted by Sections 9.4(c), 9.6 and 9.14 shall not exceed in the aggregate principal amount of $40,000,000; (d) Indebtedness outstanding on the Closing Date and listed on Schedule II; (e) Accrued future lease payments determined in accordance with GAAP; and (f) Deferred compensation payable to present and past employees of the Credit Parties and their respective Subsidiaries." (M) Section 9.5(b) of the Credit Agreement (Limitation on Liens) is hereby amended and restated in its entirety to read as follows: "(b) Any lien or liens, including without limitation, carriers', warehousemen's, mechanics', materialmen's, repairmen's or judgement liens, involving in the aggregate a liability (not paid or covered by insurance) of $10,000,000 or less." (N) Section 9.6 of the Credit Agreement (Limitation on Guarantee Obligations) is hereby amended and restated in its entirety to read as follows: "9.6 Limitation on Guarantee Obligations. Create, incur, assume or suffer to exist any Guarantee Obligation except (i) the Guarantee Obligation of the Guarantors pursuant to Section 11, (ii) guarantees by the Company of lease obligations of its Subsidiaries under leases of stores and other facilities, (iii) guaranties made by the Credit Parties of obligations of any of the other Credit Parties, and (iv) subject to the "basket" limitations set forth in Section 9.4(c), guarantees of up to the aggregate principal amount of $40,000,000 at any time outstanding by the Credit Parties of obligations of any of their Subsidiaries that are not Credit Parties." (O) Section 9.7 of the Credit Agreement (Limitations on Fundamental Changes) is hereby amended and restated in its entirety to read as follows: "9.7 Limitations on Fundamental Changes. Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer or other wise dispose of, all or substantially all -29- 7 of its property, business or assets, or make any material change in its present method of conducting business, except: (a) any Credit Party may be merged or consolidated with or into any other Credit Party (provided that such Credit Party shall be the continuing or surviving corporation or entity); (b) any Subsidiary of any Credit Party may be merged or consolidated with or into any Credit Party (provided that such Credit Party shall be the continuing or surviving corporation or entity or with or into any one or more wholly owned Subsidiaries of any Credit Party (provided that the wholly owned Subsidiary or Subsidiaries shall be the continuing or surviving corporation); (c) any Credit Party may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation, by dividend or otherwise) to any other Credit Party; (d) any wholly owned Subsidiary of a Credit Party may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any Credit Party or any other wholly owned Subsidiary of any Credit Party; and (e) any Credit Party or any wholly owned Subsidiary of a Credit Party may make Permitted Acquisitions." (P) The last proviso in Section 9.9 of the Credit Agreement (Limitations on Dividends) is hereby amended and restated in its entirety to read as follows: "provided, further, that any Credit Party (including, the Company) may declare and pay a Dividend of any amount to any other Credit Party." (Q) Section 9.11(c) of the Credit Agreement (Limitations on Investments, Loans and Advances) is hereby amended by replacing the amount "$500,000" on the fifth (5th) line thereof with the amount "$2,000,000." (R) Section 9.11(d) of the Credit Agreement (Limitations on Investments, Loans and Advances) is hereby amended and restated in its entirety to read as follows: "(d)(A) investments by the Credit Parties in any of the other Credit Parties, (B) investments by the Credit Parties in their respective Subsidiaries or Affiliates that are not Credit Parties not to exceed $20,000,000 in the aggregate, (C) investments by such Subsidiaries in the Credit Parties and in other Subsidiaries and (D) investments by the Credit Parties in Canadian Subsidiaries in the form of contributions or indebtedness as permitted under Section 9.4(b)." (S) Section 9.13 of the Credit Agreement (Transactions with Affiliates) is hereby amended and restated in its entirety to read as follows: -30- 8 "9.13 Transactions with Affiliates. Enter into any transaction, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service with any Affiliate which is not a Credit Party unless such transaction is otherwise permitted under this Agreement or is in the ordinary course of the Credit Party's or such Subsidiary's business, and is upon fair and reasonable terms no less favorable to the Credit Party or such Subsidiary, as the case may be, than it would obtain in a comparable arm's length transaction with a Person not an Affiliate." (T) Section 9.14 of the Credit Agreement (Sale and Leaseback) is hereby amended and restated in its entirety to read as follows: "9.14 Sale and Leaseback Enter into any arrangement with any Person providing for the leasing by any Credit Party or any of their respective Subsidiaries of real or personal property which has been or is to be sold or transferred by such Credit Party or such Subsidiary to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Credit Party or such Subsidiary, except for any business equipment and except for the sale or leaseback of store premises up to $40,000,000 in the aggregate amount of purchase price of such real estate, which amounts shall be included in the "basket" limitations set forth in subsections 9.4(c)." (U) Section 9.15 of the Credit Agreement (Corporate Documents) is hereby amended and restated in its entirety to read as follows: "9.15 Corporate Documents. Amend its certificate of incorporation or bylaws or certificate of formation or operating agreement or other organizational document, except if such amendment would not have a Material Adverse Effect. (V) Section 9.16 of the Credit Agreement (Fiscal Year) is hereby eliminated in its entirety and shall read as follows: "Section 9.16 Intentionally Omitted." (W) Section 10.8 of the Credit Agreement (Events of Default) is hereby amended by replacing the amount of "3,000,000" therein with the amount "$10,000,000." (X) Section 10.9 of the Credit Agreement (Events of Default) is hereby amended by replacing the amount of "$3,000,000" therein with the amount of "$10,000,000." (Y) Section 14.2 of the Credit Agreement (Notices) is hereby amended so that notices to Chase read as follows: "Chase: The Chase Manhattan Bank East 36 Midland Avenue Paramus, New Jersey 07652 Attention: Valerie Schanzer, VP Telecopy: (201) 599-6755 -31- 9 with a copy to: Schenck, Price, Smith & King, LLP 10 Washington Street Morristown, New Jersey 07963-0905 Attention: Patti S. Liberman, Esq. Telecopy: (973) 540-7300" (Z) Section 14.11 of the Credit Agreement (Governing Law) is hereby amended and restated in its entirety to read as follows: "14.11 GOVERNING LAW. THIS AGREEMENT AND THE NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK." (AA) Section 14.12(a) of the Credit Agreement (Submission to Jurisdiction; Waivers) is hereby amended to read as follows: "(a) submits for itself and its property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the Courts of the State of New York, the courts of the United States of America for the Southern District of New York, and appellate courts from any thereof." (BB) SCHEDULE I and SCHEDULE III to the Credit Agreement are hereby replaced by SCHEDULE I and SCHEDULE III to this Fifth Amendment. 2. ESTOPPEL. To induce the Credit Parties to enter into this Fifth Amendment, each of the Credit Parties hereby represents and warrants to Chase that: (A) As of the date hereof, there is currently $-0- of principal, together with accrued interest thereon, outstanding under the Revolving Credit Loan; and to the best of the Company's knowledge, the Company has no defenses, offsets or counterclaims regarding the same. (B) As of the date hereof, there is currently the amount set forth in SCHEDULE I to this Fifth Amendment of L/C Obligations outstanding under the Credit Agreement, and to the best of the Company's knowledge, the Company has no defenses, offsets or counterclaims regarding the same. (C) As of the date hereof, the Company, to the best of its knowledge, has no defenses, offsets or counterclaims regarding its other Obligations to Chase under the Credit Agreement. (D) As of the date hereof, each of the Guarantors, to the best of its knowledge, has no defenses, offsets or counterclaims regarding its Obligations to Chase under the Credit Agreement. 3. CONDITIONS PRECEDENT. The agreement of Chase to amend the Credit Agreement as -32- 10 set forth in this Fifth Amendment shall not become effective unless Chase shall have received, in form and substance reasonably satisfactory to Chase and its counsel, the following: (A) This Fifth Amendment, duly executed and delivered by the parties hereto; (B) The 1998 Note, duly executed and delivered by the Company; (C) (i) True and complete copies (including all amendments) of the charters and bylaws of each of the Credit Parties other than Calco, all certified by the corporate secretaries of each of the Credit Parties other than Calco to be in full force and effect as of such date; (ii) the certificate of formation and operating agreement of Calco, certified by the corporate secretary of the sole member of Calco to be in full force and effect as of such date; and (iii) corporate resolutions of each of the boards of directors of the Company and the other Credit Parties other than Calco, respectively, certified by each of their corporate secretaries as of the date hereof and in full force and effect and a resolution of the sole member of Calco, certified by the corporate secretary of the sole member of Calco as of such date, authorizing (x) the consummation of the transactions contemplated by this Fifth Amendment, and (y) specific officers to execute and deliver this Fifth Amendment and such other instruments and documents as may be executed in connection herewith; (D) Certificates of the corporate secretaries of each of the Company and the other Credit Parties (including the sole member of Calco) certifying the names of the officers authorized to execute this Fifth Amendment and such other instruments and documents as may be executed in connection herewith, together with true and genuine signatures of each of such officers; (E) Good standing certificates of the appropriate Governmental Authorities, dated the most recent practicable date prior to the date hereof, showing each of the Company and the other Credit Parties to be in good standing in their respective states of incorporation and such states in which such entities are authorized to do business; (F) Payment of an amendment fee of $15,000 by the Company to Chase in connection with this Fifth Amendment; (G) Payment of all other reasonable fees and expenses incurred by Chase in connection with this Fifth Amendment, including, but not limited to, reasonable fees and expenses of counsel to Chase; and (H) Such other documents, certificates, opinions, affidavits, etc. as Chase may reasonably request. Notwithstanding anything contained in Section 3 to the contrary, the items set forth in Paragraphs (C), (D) and (E) of this Section 3 may be delivered within fourteen (14) days after the date of this Fifth Amendment. The failure to delivery such items within such time period will constitute an Event of Default. 4. REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each of Company and the other Credit Parties hereby reaffirms the representations and warranties made by it in the Credit -33- 11 Agreement and all of the other Loan Documents as fully and completely as if set forth herein at length. All of such representations and warranties are true, correct and complete on the date hereof (except as to such representations and warranties, which are made as of a specified date, in which case such representations and warranties remain true as of such date). In addition, each of Company and the other Credit Parties represents and warrants to Chase that: (A) Each of the Company and the other Credit Parties has the power and authority to enter into this Fifth Amendment; (B) The execution, delivery and performance of this Fifth Amendment and the instruments and documents executed and delivered by the Company and the other Credit Parties have been duly authorized by all requisite corporate or other action and this Fifth Amendment and the instruments and documents executed and delivered in connection herewith constitute the legal, valid and binding obligations of the Company and the other Credit Parties, enforceable against each of them (to the extent each is a party thereto), in accordance with its terms; and (C) No Event of Default, or to the best of the Credit Parties' knowledge, no Default, has occurred and is continuing. (D) The execution and delivery of this Fifth Amendment and the instruments and documents executed and delivered in connection herewith, the consummation of the transactions contemplated hereunder and the fulfillment of or compliance with the terms and conditions contained herein by the Credit Parties, to the best of the Credit Parties' knowledge, are not prevented, or limited by, and do not result in the breach of, any terms, conditions or provisions of any requirements of law or any contractual obligations of the Credit Parties in any respect which could have a Material Adverse Effect. 6. POST CLOSING UNDERTAKING. By executing this Fifth Amendment, the Credit Parties agree to deliver to Chase within ninety (90) days of October 26, 1998, financial projections for the immediately succeeding three (3) years including a consolidated income statement, consolidated statement of cash flows and a consolidated balance sheet, in form and substance satisfactory to Chase. 7. MISCELLANEOUS. (A) EFFECT OF AMENDMENT. Except as amended by this Fifth Amendment, all terms and provisions of the Credit Agreement and the other Loan Documents, and all rights of Chase and obligations of the Company and the other Credit Parties thereunder, remain unchanged and in full force and effect, and are hereby ratified, adopted and confirmed in all respects. This Fifth Amendment is incorporated by reference in the Credit Agreement and the other Loan Documents. This Fifth Amendment is given as a modification of the Company's and the other Credit Parties' obligations to Chase under the Credit Agreement and is not give in substitution therefor or extinguishment thereof and is not intended to be a novation. (B) COSTS AND EXPENSES. Each of the Company and the other Credit Parties agrees to pay all reasonable costs and expenses (including, without limitation, reasonable attorneys' -34- 12 fees and expenses) incurred by Chase in connection with the preparation, execution, delivery and administration of this Fifth Amendment and the documents executed and delivered in connection herewith. (C) REFERENCES TO CREDIT AGREEMENT. All references to the "Agreement" or "this Agreement" in the Credit Agreement are deemed to mean the Credit Agreement, as amended by this Fifth Amendment. (D) COUNTERPARTS. This Fifth Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same agreement. (E) GOVERNING LAW. This Fifth Amendment shall be governed by and construed in accordance with the internal laws (and not the law of conflicts) of the State of New York. [SIGNATURES ON NEXT PAGE] -35- 13 IN WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment to be duly executed and delivered by their respective officers duly authorized as of the date set forth above. BED BATH & BEYOND INC. By:_____________________________ Name: Warren Eisenberg Title: Co-Chief Executive Officer BED-N-BATH STORES INC. By:_____________________________ Name: Warren Eisenberg Title: President BBBL, INC. By:_____________________________ Name: Warren Eisenberg Title: President BBBY MANAGEMENT CORPORATION By:_____________________________ Name: Warren Eisenberg Title: President BED BATH & BEYOND OF CALIFORNIA LIMITED LIABILITY COMPANY By: BBBL, INC., sole member By:_________________________ Name: Warren Eisenberg Title: President THE CHASE MANHATTAN BANK By:_____________________________ Name: Title: -36- EX-10.2 4 SECOND AMENDED AND RESTATED REVOLVING CREDIT AGMT 1 SECOND AMENDED AND RESTATED REVOLVING CREDIT NOTE $45,000,000 New York, New York as of October 26, 1998 FOR VALUE RECEIVED, the undersigned (the "Borrower"), a New York corporation, hereby unconditionally promises to pay to the order of THE CHASE MANHATTAN BANK (the "Bank"), at the office of the Bank located at East 36 Midland Avenue, Paramus, New Jersey 07652 or at such other place as the Bank or any holder hereof may from time to time designate, on the Termination Date (as defined in the Credit Agreement referred to below) in lawful money of the United State of America and in immediately available funds, the principal amount of (a) FORTY-FIVE MILLION DOLLARS ($45,000,000) or, if less, (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant to Subsection 2.1 of the Credit Agreement. The Borrower further agrees to pay interest in like money on the unpaid principal amount hereof from time to time from the date hereof at said office, on the dates, at the rates and for the periods specified in Sections 2 and 5 of the Credit Agreement. The holder of this Second Amended and Restated Revolving Credit Note is authorized to record the date, Type and amount of each Loan made by the Bank, each continuation thereof, each conversion of all or a portion thereof to another Type, the date and amount of each payment or prepayment of principal thereof and the length of each Interest Period with respect thereto, on the schedule annexed hereto and made a part hereof, which recordation shall constitute prima facie evidence of the accuracy of the information recorded absent manifest error; provided, however, that failure by any holder to make any such recordation on such schedules or continuation thereof shall not in any manner affect any of the obligations of the Borrower to make payments of principal and interest in accordance with the terms of this Second Amended and Restated Revolving Credit Note and the Credit Agreement. This Second Amended and Restated Revolving Credit Note is the Revolving Credit Note referred to in, and is entitled to the benefits of, the Credit Agreement dated as of October 26, 1994, as amended (as so amended, and as the same may hereafter be amended, modified or supplemented from time to time, the "Credit Agreement"; capitalized terms not otherwise defined in this Second Amended and Restated Revolving Credit Note shall have the meanings assigned to them in the Credit Agreement) among the Borrower, Bed-N-Bath Stores Inc., BBBL, Inc., Bed Bath & Beyond of California Limited Liability Company, BBBY Management Corporation and the Bank. This Second Amended and Restated Revolving Credit Note shall supersede and replace, the Amended and Restated Revolving Credit Note dated as of October 1, 1995 of the undersigned to the order of Chemical Bank (the predecessor of the Bank) (the "Prior Note") and shall not be considered a repayment or novation of the Prior Note. This Second and Amended and Restated -37- 2 Revolving Credit Note shall continue the indebtedness of the undersigned to the Bank under the Prior Note. The Credit Agreement, among other things, contains provisions for acceleration of the maturity hereof upon the happening of certain stated events and also for optional and mandatory prepayments on account of principal hereof prior to the maturity hereof on the terms and conditions therein specified. All parties now or hereafter liable with respect to this Second Amended and Restated Revolving Credit Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind. THIS AMENDED AND RESTATED REVOLVING CREDIT NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. BED BATH & BEYOND INC. By: Name: Warren Eisenberg Title: Co-Chief-Executive Officer -38- EX-27 5 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the Consolidated Balance Sheet as of November 28, 1998 and the Consolidated Statement of Earnings for the nine months ended November 28, 1998, and is qualified in its entirety by reference to such financial statements. 9-MOS FEB-27-1999 NOV-28-1998 74,550 0 0 0 401,749 483,816 210,893 (73,642) 646,868 258,371 0 0 0 1,392 371,738 646,868 977,948 977,948 577,353 577,353 297,937 0 (2,149) 104,807 41,661 63,146 0 0 0 63,146 .46 .44
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