EXHIBIT 10.1

 

DOLLAR TREE STORES, INC.

2005 EMPLOYEE STOCK PURCHASE PLAN

 

ARTICLE 1

GENERAL

 

1.1 Purpose. The Dollar Tree Stores, Inc. 2005 Employee Stock Purchase Plan
(“Plan”) is intended to attract and retain employees of Dollar Tree Stores, Inc.
and its wholly owned subsidiaries (“Company”) by providing them with an
opportunity to purchase shares of stock in the Company. The Plan is intended to
qualify as an employee stock purchase plan under Section 423 of the Internal
Revenue Code of 1986, as amended, but is not intended to be subject to the
Employee Retirement Income Security Act of 1974, as amended.

 

1.2 Effective Date. The Plan shall be effective on September 1, 2005.

 

ARTICLE 2

DEFINITIONS

 

For the purpose of this Plan, the following terms shall have the meanings set
forth in this Article unless a different meaning is required by the context:

 

2.1 Administrator. The Chief People Officer of the Company or such other person
as may be authorized from time to time pursuant to Section 3.4 hereof.

 

2.2 Board. Board of Directors of the Company.

 

2.3 Code. The Internal Revenue Code of 1986, as amended.

 

2.4 Committee. The committee appointed by the Board to administer the Plan as
described in ARTICLE 2 of the Plan or if no such Committee is appointed, the
entire Board.

 

2.5 Common Stock. The common stock $0.01 par value of the Company or the number
and kind of shares of stock or other securities into which such Common Stock may
be changed in accordance with Section 10.6 of the Plan.

 

2.6 Compensation. Wages reported on Form W-2 before the deduction for elective
deferrals to a Section 401(k) plan or Section 125 plan as those plans are
defined in the Code.

 

2.7 Eligible Recipient. An Employee who satisfies the eligibility requirements
contained in Section 4.1.

 

2.8 Employee. A common law employee of the Dollar Tree Stores, Inc. or any
Subsidiary Corporation.

 

2.9 Entry Dates. The first day of the calendar quarter, i.e., January 1, April
1, July 1 or October 1, next following the date on which an Employee has
satisfied the eligibility requirements contained in Section 4.2.

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2.10 Exchange Act. The Securities Exchange Act of 1934, as amended.

 

2.11 Fair Market Value. The Fair Market Value of the Common Stock shall be:

 

  2.11.1 If the Common Stock is listed or admitted to unlisted trading
privileges on any national securities exchange or is not so listed or admitted
but transactions in the Common Stock are reported on The Nasdaq National Market
System, the last sale price of the Common Stock on such exchange or reported by
The Nasdaq National Market System as of such date (or, if no shares were traded
on such day, as of the next preceding day on which there was such a trade).

 

  2.11.2 If the Common Stock is not so listed or admitted to unlisted trading
privileges or reported on The Nasdaq National Market System, and bid and asked
prices therefor in the over-the-counter market are reported by The Nasdaq
SmallCap Market® or the National Quotation Bureau, Inc. (or any comparable
reporting service), the mean of the closing bid and asked prices as of such
date, as so reported by The Nasdaq System, or, if not so reported thereon, as
reported by the National Quotation Bureau, Inc. (or such comparable reporting
service).

 

  2.11.3 If the Common Stock is not so listed or admitted to unlisted trading
privileges, or reported on the Nasdaq National Market System, and such bid and
asked prices are not so reported, such price as the Committee determines in good
faith in the exercise of its reasonable discretion.

 

2.12 Offering. An offer made by the Company to the Participants for the purchase
of shares of Common Stock, on a quarterly basis commencing on the Offering
Commencement Date and ending on the Offering Termination Date, through payroll
deductions subject to the terms and conditions of the Plan. The Committee shall
have the power to change the duration of Offerings (including the Offering
Commencement Date) with respect to future Offerings without shareholder approval
if such change is announced at lease five (5) days prior to the scheduled
beginning of the first Offering to be affected thereafter.

 

2.13 Offering Commencement Date. The first day of each calendar quarter.

 

2.14 Offering Termination Date. The last day of each calendar quarter.

 

2.15 Option. The right of an Eligible Recipient to purchase Common Stock under
the Plan.

 

2.16 Option Agreement. The Agreement described in Section 4.5.

 

2.17 Option Price. The purchase price for each share of Common Stock shall be
the lower of: (i) 85% of the Fair Market Value of the Common Stock on the
Offering Commencement Date; or (ii) 85% of the Fair Market Value of the Common
Stock on the Offering Termination Date.

 

2.18 Participant. An Eligible Recipient who has elected to participate in the
Plan in accordance with procedures established herein.

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2.19 Subsidiary Corporation. Any subsidiary corporation of the Company within
the meaning of Section 424(f) of the Code.

 

ARTICLE 3

PLAN ADMINISTRATION

 

3.1 The Committee. The Plan shall be administered by the Committee. Members of
such a committee, if established, shall be appointed from time to time by the
Board, shall serve at the pleasure of the Board and may resign at any time upon
written notice to the Board. A majority of the members of such a committee shall
constitute a quorum. Such a committee shall act by majority approval of the
members, shall keep minutes of its meetings and shall provide copies of such
minutes to the Board. Action of such a committee may be taken without a meeting
if unanimous written consent is given. Copies of minutes of such a committee’s
meetings and of its actions by written consent shall be provided to the Board
and kept with the corporate records of the Company.

 

3.2 Requirements of the Exchange Act or the Code. Notwithstanding Section 3.1
above, in the event that Rule 16b-3 of the Exchange Act or Section 162(m) of the
Code or any successor provisions thereto provides specific requirements for the
administrators of plans of this type, then the Plan shall only administered by
such body and in such a manner as shall comply with the applicable requirements
of Rule 16b-3 and Section 162(m).

 

3.3 Authority of the Committee. Subject to the express provisions of the Plan,
the Committee shall have plenary authority in its discretion to interpret and
construe any and all provisions of the Plan, to adopt rules and regulations for
administering the Plan, and to make all other determinations deemed necessary or
advisable for administering the Plan. The Committee’s determination in the
foregoing matters shall be conclusive.

 

3.4 Delegation by Committee. Except to the extent prohibited by applicable law
or the applicable rules of a stock exchange, the Committee may allocate all or
any portion of its responsibilities and powers to any one or more of its members
and may delegate all or any part of its responsibilities and powers to any
person or persons selected by it. Any such allocation or delegation may be
revoked by the Committee at any time.

 

ARTICLE 4

ELIGIBILITY AND PARTICIPATION

 

4.1 Conditions of Eligibility. An Eligible Recipient is an Employee who has been
employed by the Company and/or a Subsidiary Corporation for four (4) months.

 

4.2 Effective Date of Participation. An Eligible Recipient may become a
Participant as of the first day of the calendar quarter (“Entry Date”) next
following the date on which the Employee met the eligibility requirements
contained in Section 4.1, provided that the Eligible Recipient remains employed
on the Entry Date.

 

4.3 Election to Participate. An Eligible Recipient may become a Participant by
completing an Option Agreement, which includes the authorization for a payroll
deduction, on the form, including an electronic format, provided by the Company
and filing it with the Administrator on or before the date set by such officer,
which date shall be prior to the Offering Commencement Date for which
participation is sought. Properly authorized payroll deductions for a
Participant shall commence on the applicable Offering Commencement Date and
shall end when terminated by the terms of the Option Agreement or when
terminated by the Participant as provided in ARTICLE 8.

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4.4 Restrictions on Participation. Notwithstanding any provisions of the Plan to
the contrary, no Employee shall be granted an Option to participate in the Plan:

 

  4.4.1 if, immediately after the grant, such Employee would own stock, and/or
hold outstanding Options to purchase stock, possessing 5% or more of the total
combined voting power or value of all classes of stock of the Company (for
purposes of this paragraph, the rules of Section 424(d) of the Code shall apply
in determining stock ownership of any employee); or

 

  4.4.2 which permits an Employee’s rights to purchase Common Stock under all
employee stock purchase plans of the Company to accrue at a rate which exceeds
$25,000 in fair market value of the Common Stock (determined at the time such
Option is granted) for each calendar year in which such Option is outstanding.

 

4.5 Option Agreement. Each Eligible Recipient shall receive an Option Agreement.
The Option Agreement shall contain the terms for the purchase of Common Stock
pursuant to the provisions of the Plan and the discretion of the Committee where
applicable. The Option Agreement shall also contain authorization for the
payroll deduction. An Eligible Recipient may only become a Participant upon the
timely completion and return of the Option Agreement according to the terms
contained therein.

 

ARTICLE 5

OFFERINGS AND OPTION GRANTS

 

5.1 Duration of Offerings. The Plan shall be implemented in a series of
quarterly Offerings which shall continue until all shares of Common Stock
reserved for this Plan have been issued to the Participants. Notwithstanding
anything to the contrary, this Plan shall terminate and there shall be no
further Offerings upon the earlier of: (1) the issuance of all shares reserved
under Section 9.1 of Common Stock or (2) the end of the fortieth (40th)
quarterly Offering.

 

5.2 Number of Option Shares. On each Offering Commencement Date, a Participant
shall be granted an Option to purchase on each Offering Termination Date up to a
number of shares of Common Stock of the Company determined by dividing such
Participants accumulated payroll deductions as of the Offering Termination Date
by the applicable Option Price; provided that in no event shall a Participant be
permitted to purchase during each Offering more than 1,000 shares of Common
Stock of the Company, and provided further that such purchase shall be subject
to the limitations of Sections 4.4 and 10.1. The Committee may for future
offerings, increase or decrease, in its absolute discretion, the maximum number
of shares of Common Stock that a Participant may purchase during each Offering.
Exercise of the Option shall occur as provided herein, unless the Participant
has withdrawn pursuant to ARTICLE 8. The Option shall expire on the Offering
Termination Date.

 

ARTICLE 6

PAYROLL DEDUCTIONS

 

6.1 Amount of Deduction. Upon filing the Option Agreement, the Participant shall
elect to have deductions made from his paycheck on each payday during the time
he is a Participant in an Offering at the rate of 1, 2, 3, 4, 5, 6, 7, 8, 9 or
10% of his compensation as determined for each applicable paycheck.

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6.2 Participant’s Account. The Company shall establish a bookkeeping account for
each Participant and all payroll deductions made for a Participant shall be
credited to his account under the Plan.

 

6.3 Changes in Payroll Deductions. A Participant may discontinue his
participation in the Plan as provided in ARTICLE 8, but no other change can be
made during an Offering and, specifically, a Participant may not alter the
amount of his payroll deductions for that Offering.

 

ARTICLE 7

EXERCISE OF OPTION

 

7.1 Automatic Exercise. Unless a Participant gives written notice to the Company
as hereinafter provided, his Option for the purchase of Common Stock with
payroll deductions made during any Offering will be deemed to have been
exercised automatically on the Offering Termination Date applicable to such
Offering, for the purchase of the number of full shares of Common Stock which
the accumulated payroll deductions in his account at that time will purchase at
the applicable Option Price (but not in excess of the number of shares for which
Options have been granted to the employee pursuant to Section 5.2 ) and any
excess in his account at that time will be returned to him, except as provided
in Section 7.3.

 

7.2 Withdrawal of Account. By written notice to the Administrator, at any time
prior to the Offering Termination Date applicable to any Offering, a Participant
may elect to withdraw all the accumulated payroll deductions in his account at
such time.

 

7.3 Fractional Shares. Fractional shares will not be issued under the Plan and
any accumulated payroll deductions which would have been used to purchase
fractional shares shall, unless otherwise requested by the Participant, be held
in the Participant’s account for the purchase of Common Stock during the next
Offering.

 

7.4 Transferability of Option. During a Participant’s lifetime, Options held by
such Participant shall be exercisable only by that Participant.

 

7.5 Delivery of Stock. As promptly as practicable after the Offering Termination
Date of each Offering, the Company shall arrange the delivery to each
Participant, as appropriate, of a record of the shares purchased. The
Administrator may permit or require that such shares be deposited directly with
a broker designated by such officer or to a designated agent of the Company, and
the Administrator may utilize electronic or other automated methods of share
transfer. Common Stock will be issued in the name of the Participant, or, if the
Participant so directs by written notice to the Administrator prior to the
Offering Termination Date applicable thereto, in the names of the Participant
and one such other person as may be designated by the Participant, as joint
tenants with rights of survivorship or as tenants by the entireties, to the
extent permitted by applicable law. No participant shall have any voting,
dividend, or other shareholder rights with respect to shares of Common Stock
subject to any Option granted under the Plan until such shares have been
purchased and delivered to the Participant as provided in this Section 7.5.

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ARTICLE 8

WITHDRAWAL

 

8.1 In General. Under procedures established by the Committee, a participant may
withdraw all but not less than all the payroll deductions credited to his or her
account and not yet used to exercise his or her Option under the Plan by
submitting to the Administrator a notice of withdrawal in the form and manner
prescribed by the Committee for such purpose. Unless otherwise determined by the
Committee on a uniform and non-discriminatory basis, any election to withdraw
from an Offering will be effective only with respect to the Offering Termination
Dates that are at least five (5) business days after the properly completed
election is received by the Administrator. All of the Participant’s payroll
deductions credited to his or her account shall be paid to such participant as
promptly as practicable after the effective date of his or her withdrawal and
such Participant’s Option for the Offering shall be automatically terminated,
and no further payroll deductions for the purchase of shares shall be made for
such Offering. Once a Participant has withdrawn from an Offering, the
Participant may not re-enroll in the same Offering. Moreover, payroll deductions
shall not resume at the beginning of the succeeding Offering unless the
Participant re-enrolls in the Plan in accordance with provisions of Section 4.3.

 

8.2 Effect on Subsequent Participation. A Participant’s withdrawal from any
Offering will not have any effect upon his eligibility to participate in any
succeeding Offering or in any similar plan which may hereafter be adopted by the
Company.

 

8.3 Termination of Employment. Upon termination of the Participant’s employment
for any reason, including retirement (but excluding death while in the employ of
the Company or any Subsidiary Corporation), the Participant shall be deemed to
have elected to withdraw from the Plan and the payroll deductions credited to
such Participant’s account during the Offering but not yet used to exercise the
Option shall be returned to such Participant or, in the case of his or her
death, to the person or persons entitled thereto under Section 10.2, and such
Participant’s Option shall be automatically terminated.

 

8.4 Termination of Employment Due to Death. Upon termination of the
Participant’s employment because of his death, his beneficiary (as defined in
Section 10.2) shall have the right to elect, by written notice given to the
Administrator prior to the earlier of the Offering Termination Date or the
expiration of a period of sixty (60) days commencing with the date of death of
the Participant, either:

 

  8.4.1 to withdraw all of the payroll deductions credited to the Participant’s
account under the Plan, or

 

  8.4.2 to exercise the Participant’s Option for the purchase of Common Stock on
the Offering Termination Date next following the date of the Participant’s death
for the purchase of the number of full shares of Common Stock which the
accumulated payroll deductions in the Participant’s account at the date of the
Participant’s death will purchase at the applicable Option Price, and any excess
in such account will be returned to said beneficiary, without interest.

 

In the event that no such written notice of election shall be duly received by
the treasurer of the Company, the beneficiary shall automatically be deemed to
have elected, pursuant to paragraph 8.4.2, to exercise the Participant’s Option.

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ARTICLE 9

STOCK

 

9.1 Maximum Shares. The maximum number of shares of Common Stock which shall be
issued under the Plan, subject to adjustment upon changes in capitalization of
the Company as provided in Section 10.6 shall be equal to the sum of (i) one
million (1,000,000) shares of Common Stock, and (ii) any shares of Common Stock
available for future awards under any prior employee stock purchase plan of the
Company (the “Prior Plans”) as of the Effective Date; and (iii) any shares of
Common Stock that are represented by options granted under any Prior Plans which
are forfeited, expire or are canceled without delivery of shares of Common Stock
or which for any reason result in the forfeiture of the shares of Common Stock
back to the Company. If the total number of shares of Common Stock for which
Options are exercised on any Offering Termination Date in accordance with
ARTICLE 5 exceeds the maximum number of shares reserved for this Plan, the
Company shall make a pro rata allocation of the shares of Common Stock available
for delivery and distribution in as nearly a uniform manner as shall be
practicable and as it shall determine to be equitable, and the balance of
payroll deductions credited to the account of each Participant under the Plan
shall be returned to him as promptly as possible.

 

9.2 Participant’s Interest in Common Stock. The Participant will have no
interest in the Common Stock covered by his Option until such Option has been
exercised on the applicable Offering Termination Date.

 

ARTICLE 10

MISCELLANEOUS

 

10.1 Compliance with Applicable Laws. The Plan, the grant and exercise of
options to purchase shares under the Plan, and the Company’s obligation to sell
and deliver shares upon the exercise Options to purchase shares shall be subject
to compliance with all applicable federal, state and foreign laws, rules and
regulations and the requirements of any stock exchange on which the shares may
then be listed.

 

10.2 Designation of Beneficiary. The designated beneficiary pursuant to a
qualified plan (as described in Section 401(a) of the Code) maintained by the
Company shall be the designated beneficiary for this Plan, unless a Participant
files a written designation of a beneficiary pursuant to this Plan. Such
designation of beneficiary may be changed by the Participant at any time by
written notice to the Administrator. Upon the death of a Participant and upon
receipt by the Company of proof of identity and existence at the Participant’s
death of a beneficiary validly designated by him under the Plan, the Company
shall deliver such Common Stock and/or cash to such beneficiary. In the event of
the death of a Participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such Participant’s death,
the Company shall deliver such Common Stock and/or cash to the executor or
administrator of the estate of the Participant, or if no such executor or
administrator has been appointed (to the knowledge of the Company), the Company,
in its discretion, may deliver such Common Stock and/or cash to the spouse or to
any one or more dependents of the Participant as the Company may designate. No
beneficiary shall, prior to the death of the Participant by whom he has been
designated, acquire any interest in the stock or cash credited to the
Participant under the Plan.

 

10.3

Transferability. Neither payroll deductions credited to a Participant’s account
nor any rights with regard to the exercise of an Option or to receive Common
Stock under the Plan

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may be assigned, transferred, pledged, or otherwise disposed of in any way by
the Participant other than by will or the laws of descent and distribution. Any
such attempted assignment, transfer, pledge or other disposition shall be
without effect, except that the Company may treat such act as an election to
withdraw funds in accordance with Section 7.2.

 

10.4 Use of Funds. Any payroll deductions received or held by the Company under
this Plan may be used by the Company for any corporate purpose and the Company
shall not be obligated to segregate such payroll deductions.

 

10.5 Interest. No interest will be paid or allowed on any money paid into the
Plan or credited to the account of any Participant.

 

10.6 Adjustment Upon Changes in Capitalization.

 

  10.6.1 In the event of any reorganization, merger, consolidation,
recapitalization, liquidation, reclassification, stock dividend, stock split,
combination of shares, rights offering, extraordinary dividend or divesture
(including a spin-off) or any other change in the corporate structure or shares
of the Company, the Committee (or, if the Company is not the surviving
corporation in any such transaction, the board of directors of the surviving
corporation) shall make appropriate adjustment (which determination shall be
conclusive) as to the number and kind of securities subject to outstanding
Options. Without limiting the generality of the foregoing, in the event that any
of such transactions are effected in such a way that holders of Common Stock
shall be entitled to receive stock, securities or assets, including cash, with
respect to or in exchange for such Common Stock, all Participants holding
outstanding Options shall upon the exercise of such Option receive, in lieu of
any shares of Common Stock they may be entitled to receive, such stock
securities or assets, including cash, as have been issued to such Participants
if their Options had been exercised and such Participants had received Common
Stock prior to such transaction.

 

  10.6.2 Upon: (a) the sale, lease, exchange or other transfer of all or
substantially all of the assets of the Company (in one transaction or in a
series of related transactions) to a corporation that is not controlled by the
Company, (b) the approval by the shareholders of the Company of any plan or
proposal for the liquidation or dissolution of the Company, (c) a successful
tender offer for the Common Stock of the Company, after which the tendering
party holds more than 30% of the issued and outstanding Common Stock of the
Company, or (d) a merger, consolidation, share exchange, or other transaction to
which the Company is a party pursuant to which the holders of all of the shares
of the Company outstanding prior to such transaction do not hold, directly or
indirectly, at least 70% of the outstanding shares of the surviving company
after the transaction, the holder of each Option then outstanding under the Plan
will thereafter be entitled to receive at the next Offering Termination Date
upon the exercise of such Option for each share as to which such Option shall be
exercised, as nearly as reasonably may be determined, the cash, securities
and/or property which a holder of one share of Common stock was entitled to
receive upon and at the time of such transaction. The Board of Directors shall
take such steps in connection with such transactions as the Board shall deem
necessary to assure that the provisions of this Section 10.6 shall thereafter be
applicable, as nearly as reasonably may be determined, in relation to the said
cash, securities and/or property as to which such holder of such Option might
thereafter be entitled to receive.

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10.7 Amendment and Termination. The Board may suspend or terminate the Plan or
any portion thereof at any time, and may amend the Plan from time to time in
such respects as the Board may deem advisable in order that Options under the
Plan shall conform to any change in applicable laws or regulations or in any
other respect the Board may deem to be in the best interests of the Company;
provided, however, that no such amendment shall be effective, without approval
of the shareholders of the Company, if shareholder approval of the amendment is
then required to comply with or obtain exemptive relief under any tax or
regulatory requirement the Board deems desirable to comply with or obtain
exemptive relief under, including without limitation, pursuant to Rule 16b-3
under the Exchange Act or any successor rule or Section 422 of the Code or under
the applicable rules or regulations of any securities exchange or the NASD, and
provided further that no such amendment shall change the terms, conditions or
eligibility requirements of an Option granted under the Plan. No termination,
suspension or amendment of the Plan shall alter or impair any outstanding Option
without the consent of the Participant affected thereby; provided, however, that
this sentence shall not impair the right of the Committee to take whatever
action it deems appropriate under Section 10.6.1 or Section 10.6.2 of the Plan.

 

10.8 No Employment Rights. Nothing in the Plan shall interfere with or limit in
any way the right of the Company or any Subsidiary to terminate the employment
or service of any Eligible Recipient or Participant at any time, nor confer upon
any Eligible Recipient or Participant any right to continue in the employ or
service of the Company or any Subsidiary.

 

10.9 Effect of Plan. The provisions of the Plan shall, in accordance with its
terms, be binding upon, and inure to the benefit of, all successors of each
employee participating in the Plan, including, without limitation, such
Employee’s estate and the executors, administrators or trustees thereof, heirs
and legatee, and any receiver, trustee in bankruptcy or representative of
creditors of such Employee.

 

10.10 Governing Law. The place of administration of the Plan shall be
conclusively deemed to be within the Commonwealth of Virginia, and the rights
and obligations of any and all persons having or claiming to have had an
interest under the Plan or under any agreements evidencing Options shall be
governed by and construed exclusively and solely in accordance with the laws of
the Commonwealth of Virginia without regard to conflict of laws provisions of
any jurisdictions. All parties agree to submit to the jurisdiction of the state
and federal courts of Virginia with respect to matters relating to the Plan and
agree not to raise or assert the defense that such forum is not convenient for
such party.

 

10.11 Construction and Headings. The use of the masculine gender shall also
include within its meaning the feminine, and the singular may include the plural
and the plural may include the singular, unless the context clearly indicates to
the contrary. The headings of the Articles and Sections of the Plan are for
convenience of reading only and are not meant to be of substantive significance
and shall not add or detract from the meaning of such Article or Section.