Dollar Tree 2011 Annual Report Download - page 46

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Deferred Compensation Plan
e Company has a deferred compensation plan which
provides certain officers and executives the ability to defer a
portion of their base compensation and bonuses and invest
their deferred amounts. e plan is a nonqualified plan
and the Company may make discretionary contributions.
e deferred amounts and earnings thereon are payable
to participants, or designated beneficiaries, at specified
future dates, or upon retirement or death. Total cumulative
participant deferrals were approximately $3.3 million and
$2.8 million, respectively, at January 28, 2012 and January
29, 2011, and are included in “other liabilities” on the
accompanying consolidated balance sheets. e related
assets are included in “other assets, net” on the accompa-
nying consolidated balance sheets. e Company did not
make any discretionary contributions in the years ended
January 28, 2012, January 29, 2011, or January 30, 2010.
NOTE 9—STOCK-BASED COMPENSATION PLANS
At January 28, 2012, the Company has nine stock-based
compensation plans. Each plan and the accounting
method are described below.
Fixed Stock Option Compensation Plans
Under the Non-Qualified Stock Option Plan (SOP), the
Company granted options to its employees for 1,570,896
shares of Common Stock in 1993 and 1,572,434 shares
in 1994. Options granted under the SOP have an exercise
price of $0.57 and are fully vested at the date of grant.
Under the 1995 Stock Incentive Plan (SIP), the
Company granted options to its employees for the
purchase of up to 18.9 million shares of Common Stock.
e exercise price of each option equaled the market price
of the Company’s stock at the date of grant, unless a higher
price was established by the Board of Directors, and an
option’s maximum term is 10 years. Options granted under
the SIP generally vested over a three-year period. is
plan was terminated on July 1, 2003 and replaced with the
Company’s 2003 Equity Incentive Plan (EIP).
Under the EIP, the Company granted up to 9.0
million shares of its Common Stock, plus any shares
available for future awards under the SIP, to the
Company’s employees, including executive officers
and independent contractors. e EIP permitted the
Company to grant equity awards in the form of stock
options, stock appreciation rights and restricted stock.
e exercise price of each stock option granted equaled
the market price of the Company’s stock at the date
of grant. e options generally vest over a three-year
period and have a maximum term of 10 years. is plan
was terminated on June 16, 2011 and replaced with the
Company’s Omnibus Incentive Plan (Omnibus Plan).
e Executive Officer Equity Incentive Plan (EOEP)
was available only to the Chief Executive Officer and
certain other executive officers. ese officers no longer
received awards under the EIP. e EOEP allowed the
Company to grant the same type of equity awards as the
EIP. ese awards generally vest over a three-year period,
with a maximum term of 10 years. is plan was termi-
nated on June 16, 2011 and replaced with the Company’s
Omnibus Incentive Plan (Omnibus Plan).
Stock appreciation rights may be awarded alone or in
tandem with stock options. When the stock appreciation
rights are exercisable, the holder may surrender all or a
portion of the unexercised stock appreciation right and
receive in exchange an amount equal to the excess of
the fair market value at the date of exercise over the fair
market value at the date of the grant. No stock apprecia-
tion rights have been granted to date.
Any restricted stock or RSUs awarded are subject to
certain general restrictions. e restricted stock shares or
units may not be sold, transferred, pledged or disposed
of until the restrictions on the shares or units have lapsed
or have been removed under the provisions of the plan.
In addition, if a holder of restricted shares or units ceases
to be employed by the Company, any shares or units in
which the restrictions have not lapsed will be forfeited.
e 2003 Non-Employee Director Stock Option
Plan (NEDP) provided non-qualified stock options
to non-employee members of the Company’s Board of
Directors. e stock options were functionally equivalent
to such options issued under the EIP discussed above. e
exercise price of each stock option granted equaled the
closing market price of the Company’s stock on the date of
grant. e options generally vested immediately. is plan
was terminated on June 16, 2011 and replaced with the
Company’s Omnibus Incentive Plan (Omnibus Plan).
e 2003 Director Deferred Compensation Plan
permits any of the Company’s directors who receive a
retainer or other fees for Board or Board committee
service to defer all or a portion of such fees until a future
date, at which time they may be paid in cash or shares of
the Company’s common stock, or receive all or a portion
of such fees in non-statutory stock options. Deferred fees
that are paid out in cash will earn interest at the 30-year
Treasury Bond Rate. If a director elects to be paid in
common stock, the number of shares will be determined
by dividing the deferred fee amount by the closing market
price of a share of the Company’s common stock on
the date of deferral. e number of options issued to a
director will equal the deferred fee amount divided by
33% of the price of a share of the Company’s common
stock. e exercise price will equal the fair market value
of the Company’s common stock at the date the option is
44 Dollar Tree, Inc.