8-KLeadership ChangesMaterial AgreementsCorporate Changes+2

DOLLAR TREE, INC. 8-K Report, Material Agreement (Jan 23, 2008)

Filed January 23, 2008For Securities:DLTR

Summary

Dollar Tree, Inc. (DLTR) filed an 8-K on January 23, 2008, primarily detailing changes to its director compensation structure and adding a new director. Effective at the 2008 Annual Meeting of Shareholders, non-employee directors will see their annual retainers increase from $80,000 to $100,000, with corresponding increases in committee chair and member stipends. Additionally, a Lead Director role has been introduced with an extra $10,000 annual compensation. These adjustments aim to align director pay with that of other public retailers and better incentivize shareholder value alignment. In other significant updates, the Board of Directors has expanded its size from twelve to thirteen members with the appointment of Arnold S. Barron as a Class II director, who will stand for election at the upcoming annual meeting. Furthermore, the filing discloses performance-based equity awards granted to key named executive officers, including Bob Sasser, Gary Philbin, and Robert Rudman, as well as Kathleen Mallas. These awards are contingent upon the company achieving specific fiscal year 2008 earnings per share targets and the executives' continued employment, reinforcing a performance-driven compensation philosophy.

Key Highlights

  • 1Director compensation is being enhanced, with annual retainers for non-employee directors increasing from $80,000 to $100,000 starting in 2008.
  • 2Committee stipends and a new Lead Director compensation ($10,000 annually) have also been increased, reflecting enhanced responsibilities and market alignment.
  • 3The Board of Directors has appointed Arnold S. Barron as a new Class II director, expanding the board size to thirteen members.
  • 4Performance-based equity awards (restricted stock units and options) have been authorized for named executive officers, contingent on achieving fiscal 2008 EPS targets and continued service.
  • 5Key executives receiving awards include Bob Sasser, Gary Philbin, Robert Rudman, and Kathleen Mallas.
  • 6Several equity plans (2004 Executive Officer Equity Plan, 2003 Equity Incentive Plan, 2003 Deferred Directors Compensation Plan) have been amended to comply with Section 409A of the Internal Revenue Code.
  • 7Amendments were also made to equity plans to adjust anti-dilution provisions and grant price procedures, ensuring consistency and compliance.

Frequently Asked Questions

Dollar Tree is increasing director compensation to align it with that of other public retailers and to better align director interests with shareholder interests. The new policy offers a more competitive total compensation package.

Arnold S. Barron has been appointed as a Class II director. He currently serves as a Senior Executive Vice President with The TJX Companies, Inc. He will stand for election by shareholders at the 2008 Annual Meeting.

The performance-based equity awards granted to executives are contingent upon Dollar Tree achieving a target level of earnings per share (EPS) in fiscal year 2008 and the executives remaining with the company for a specified period.

The company has amended its bylaws to increase the number of directors from twelve to thirteen and has made several amendments to its equity plans to comply with IRS Section 409A regulations and to adjust anti-dilution provisions and grant pricing procedures.