Exhibit 10.1
--- Only to be issued to Named
Executive Officers ---
DOLLAR TREE, INC.
NAMED EXECUTIVE OFFICER
OPTION AGREEMENT
(FOR TIME-VESTED AND
PERFORMANCE-BASED AWARDS)
NOTE: This
document incorporates the accompanying Grant Letter, and together
they constitute a single Agreement which governs the terms and
conditions of your Option in accordance with the Company’s
2003 Equity Incentive Plan or 2004 Executive Officer Equity Plan,
as applicable.
THIS AGREEMENT (“Agreement”), is
effective as of the Grant Date specified in the accompanying Grant
Letter, by and between the Participant and Dollar Tree, Inc.
(“Company”).
A. The Company maintains both the 2003 Equity
Incentive Plan (“EIP”) and the 2004 Executive Officer
Equity Plan (“EOEP”).
B. The Participant has been selected by the
committee administering the EIP and EOEP (“Committee”)
to receive a Non-Qualified Stock Option Award under one of these
plans.
C. Key terms and important conditions of the
Award are set forth in the cover letter (“Grant
Letter”) which was delivered to the Participant at the same
time as this document. This Agreement contains general provisions
relating to the Award. The Grant Letter specifies whether the Award
is issued under the EIP or the EOEP (whichever is applicable, the
“Plan”).
IT IS AGREED, by and between the Company and the
Participant, as follows:
1. Terms of Award . The following terms
used in this Agreement shall have the meanings set forth in this
paragraph 1:
(a) The “Participant” is the
individual named in the Grant Letter.
(b) The “Grant Date” is the date of
the Grant Letter.
(c) The “Covered Shares” is that
number of shares of the Company’s Stock specified in the
Grant Letter.
(d) The “Exercise Price” is the
price per common share set forth in the Grant Letter.
Other terms
used in this Agreement are defined pursuant to paragraph 8 or
elsewhere in this Agreement.
2. Award and Exercise Price . This
Agreement specifies the terms of the option (the
“Option”) granted to the Participant to purchase the
number of Covered Shares at the Exercise Price per share. The
Option is not an “incentive stock option” as that term
is used in Code section 422.
3. Date of Exercise . Subject to the
limitations of this Agreement, the Option shall be exercisable in
accordance with the terms set forth in the Grant Letter. An Option
shall not become exercisable on the otherwise applicable vesting
date if the Participant’s Date of Termination (as defined in
paragraph 8) occurs on or before such vesting date. Notwithstanding
the foregoing provisions, however, the Option shall become
exercisable with respect to the Covered Shares (to the extent it is
not then otherwise exercisable) as follows:
(a) The Option shall become fully exercisable
upon the Participant’s Date of Termination, if the
Participant’s Date of Termination occurs by reason of the
Participant’s death, Retirement or
Disability. Notwithstanding the foregoing, if the Option
is conditioned on the achievement of one or more performance
objectives set forth in the Grant Letter, then the Option shall
become exercisable under this paragraph 3(a) only as of the
applicable vesting date (assuming achievement of the performance
objectives), with the number of Covered Shares exercisable
pro-rated based on the ratio of actual months of employment by the
Participant to the total number of months in the applicable vesting
schedule, if any.
(b) The Option shall become fully exercisable
upon a Change in Control, if (i) the Participant’s Date of
Termination does not occur before the Change in Control and (ii)
the Committee determines to accelerate such
exercisability. Notwithstanding the foregoing, if the
Option is conditioned on the achievement of one or more performance
objectives set forth in the Grant Letter, then the amount of
Covered Shares subject to accelerated vesting under this paragraph
3(b) shall not exceed the pro rata amount based on the ratio of
actual months of employment by the Participant to the date of the
Change of Control to the total number of months in the applicable
vesting schedule, if any. The accelerated vesting of
such pro rata portion is subject to attaining the performance
objectives, with partial settlement of the Option to occur as soon
as practical after the Compensation Committee certifies attainment
of the goals. If the Committee determines to accelerate
vesting of such Option in this manner, then the remainder of the
Covered Shares shall be unaffected, with full vesting of such
remaining Covered Shares on the applicable vesting date (only if
the performance objectives have been met).
The Option may
be exercised on or after the Date of Termination only as to that
portion of the Covered Shares as to which it was exercisable
immediately prior to the Date of Termination, or as to which it
became exercisable on the Date of Termination in accordance with
this paragraph 3.
4. Expiration . The Option shall not be
exercisable after the Company’s close of business on the last
business day that occurs prior to the Expiration Date. The
“Expiration Date” shall be earliest to occur
of:
(a) the ten year anniversary of the Grant
Date;
(b) if the Participant’s Date of
Termination occurs by reason of death, Disability or Retirement,
the ten year anniversary of the Grant Date;
(c) if the Participant’s Date of
Termination occurs for reasons other than “cause,”
death, Disability, or Retirement, the 90-day anniversary of such
Date of Termination;
(d) if the Participant’s Date of
Termination occurs for “cause,” the Date of
Termination; or
(e) the date on which the Committee determines
the Participant materially violated (i) the provisions of paragraph
10 below or (ii) any non-competition agreement which the
Participant may have entered into with the Company.
5. Method of Option Exercise .
(a) Subject to the terms of this Agreement and
the Plan, the Option may be exercised in whole or in part by filing
a written notice with the Chief People Officer (or such other party
as the Company may designate) of the Company at its corporate
headquarters prior to the Company’s close of business on the
last business day that occurs prior to the Expiration Date. Such
notice shall specify the number of Covered Shares which the
Participant elects to purchase, and shall be accompanied by payment
of the Exercise Price for such shares of Stock indicated by the
Participant’s election.
(b) Payment shall be by cash or by check payable
to the Company. Except as otherwise provided by the Committee
before the Option is exercised: (i) all or a portion of the
Exercise Price may be paid by the Participant by delivery of shares
of Stock that have been owned by the Participant for at least six
(6) months and are otherwise acceptable to the Committee having an
aggregate Fair Market Value (valued as of the date of exercise)
that is equal to the amount of cash that would otherwise be
required; and
(ii) the
Participant may pay the Exercise Price by authorizing a third party
to sell shares of Stock (or a sufficient portion of the shares)
acquired upon exercise of the Option and remit to the Company a
sufficient portion of the sale proceeds to pay the entire Exercise
Price and any tax withholding resulting from such
exercise.
(c) The Option shall not be exercisable if and
to the extent the Company determines that such exercise would
violate applicable state or Federal securities laws or the rules
and regulations of any securities exchange on which the Stock is
traded. If the Company makes such a determination, it shall use all
reasonable efforts to obtain compliance with such laws, rules and
regulations. In making any determination hereunder, the Company may
rely on the opinion of counsel for the Company.
(d) The Option does not include and may not be
amended to include any feature for the deferral of compensation
other than the income that may be deferred until the exercise of
the Option, or the time the stock acquired pursuant to the exercise
of the Option first becomes substantially vested.
6. Withholding . All deli
