8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): December 8, 2006

DOLLAR TREE STORES, INC.

(Exact name of registrant as specified in its charter)

VIRGINIA

(State or Other Jurisdiction of Incorporation)

0-25464	54-1387365
(Commission File Number)	(I.R.S. Employer Identification No.)

500 Volvo Parkway

Chesapeake, VA 23320

(Address of Principal Executive Offices and Zip Code)

(757) 321-5000

(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On December 8, 2006, Dollar Tree Stores, Inc. (the “Company”) entered into an accelerated share repurchase program with Goldman, Sachs & Co. (“Goldman Sachs”) to repurchase $100 million of the Company’s common stock. The accelerated share repurchase program is part of a repurchase program authorized by the Company’s board of directors to repurchase up to $500 million of common shares that was previously announced on November 21, 2006.

Under the accelerated share repurchase program, the Company has entered into two accelerated stock repurchase agreements, the material terms of which are described below:

·   Under a collared agreement, the Company has repurchased for $50 million a number of shares to be determined based on the volume weighted average share price of the Company’s common stock during a specified period of time, subject to certain provisions that establish a minimum and maximum number of shares that may be repurchased by the Company. The minimum number of shares the Company has repurchased under the agreement will be determined by dividing $50 million by approximately 110% of the volume weighted average share price of the Company’s common stock over a period of up to eleven weeks following execution of the agreement, and the maximum number of shares subject to repurchase will be determined by dividing $50 million by approximately 97.5% of the volume weighted average share price over the same time period. Goldman Sachs will deliver the minimum number of shares to the Company within the first two weeks from the December 8, 2006 execution date.  Three months after execution, the Company may receive additional shares from Goldman Sachs depending on the volume weighted average price of the shares during that period, subject to the maximum share delivery provisions of the agreement.

·   Under a non-collared agreement, which covers approximately $50 million of share repurchase, the Company has repurchased a set number of shares, with a purchase price adjustment to be determined at the end of three months based on the volume weighted average share price of the Company’s common stock during the same period of time utilized to calculate the minimum and maximum shares under the collared agreement above. Goldman Sachs will deliver the entire amount of repurchased shares to the Company immediately after execution, there may be a settlement in cash or shares based on Goldman's execution in relation to the volume weighted share price over and up to the three month period.

Under the two agreements, the Company will prepay $100 million to Goldman Sachs on December 13, 2006 and receive approximately 2.7 million common shares. Thereafter, the Company has no other obligations under the collared agreement to pay additional amounts or deliver shares to Goldman Sachs.  In certain circumstances the completion dates of the agreements may be shortened or extended from the periods described above.

Shares repurchased under the accelerated stock repurchase program will be retired.

From time to time the Company engages Goldman Sachs as an advisor for investment banking and other corporate activities. In addition, Goldman Sachs Asset Management, L.P. owns approximately 1.3% of the outstanding common shares of the Company as of the latest reporting period.

Item 7.01 Regulation FD Disclosure.

The Company issued a press release concerning the accelerated share repurchase program before market open on December 11, 2006. The contents of such press release (attached to this Current Report on Form 8-K as Exhibit 99.1) are hereby incorporated by reference and furnished under this Item 7.01.

Item 9.01. Financial Statements and Exhibits.

(c)Exhibits.

99.1 Press Release dated December 11, 2006 issued by Dollar Tree Stores, Inc.

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SIGNATURES

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, hereunto duly authorized.

	DOLLAR TREE STORES, INC.
Date:  December 13, 2006	By:	/s/ Kent A. Kleeberger
		Kent A. Kleeberger
		Chief Financial Officer

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EXHIBITS

Exhibit 99.1 - Press release dated December 11, 2006 issued by Dollar Tree Stores, Inc.

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EX-99.1 CHARTER

Exhibit 99.1

Dollar Tree Stores, Inc. Announces $100 Million Accelerated Share Repurchase

CHESAPEAKE, Va. - December 11, 2006 - Dollar Tree Stores, Inc. (NASDAQ: DLTR), the nation's leading operator of single-price point dollar stores, today announced that after market close on December 8, 2006, it entered into two agreements with Goldman, Sachs & Co. to repurchase approximately $100 million of its common shares under an accelerated share repurchase program. Dollar Tree will acquire these common shares under the $500 million share repurchase program announced on November 21, 2006.

Under the accelerated share repurchase program, Dollar Tree will immediately pay $100 million and receive approximately 2.7 million shares. We expect to receive additional shares before, and may receive additional shares upon, the anticipated three-month maturity of the program, depending on the market value of our common shares. The first agreement, which covers half of the accelerated repurchase amount, includes collar provisions that establish the minimum and maximum numbers of shares. The second agreement, which covers the balance of the accelerated repurchase amount, includes purchase price adjustment provisions. The specific number of shares to be repurchased is generally based on the volume weighted average share price of the company’s common shares during the term of the accelerated share repurchase program, subject in part to collar provisions that establish the minimum and maximum numbers of shares under the first agreement. The company expects final delivery of any additional shares to occur in the first quarter of 2007, although in certain circumstances the completion date may be shortened or extended. All of the repurchased shares will be retired. Prior to issuance of this press release, no trading activity has occurred in the public market related to the accelerated share repurchase program.

"Our share repurchase program continues to represent an important part of our capital allocation strategy and an efficient and flexible way of returning value to shareholders," said President and CEO Bob Sasser. “We ended fiscal year 2005 with nearly $350 million in cash and investments and believe we have the ability to generate substantial free cash flow over the next five years. In anticipation of the ability to fund future growth while generating a significant amount of free cash flow, we believe that the accelerated share repurchase is a good use of capital and will provide long term benefit to our shareholders.”

Dollar Tree Stores operates 3,228 stores in 48 states as of November 25, 2006.

A WARNING ABOUT FORWARD-LOOKING STATEMENTS: This press release contains "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements address future events, developments or results and typically use words such as believe, anticipate, expect, intend, plan or estimate. For example, our forward-looking statements include statements regarding our intentions to repurchase stock, the method and timing as well as the number of shares repurchased, related expenditures and the benefits of such transaction. They also include statements about our future cash flow and our ability to fund future growth. For a discussion of the risks, uncertainties and assumptions that could affect our future events, developments or results, you should carefully review the “Risk Factors,” "Business," and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections in our Annual Report on Form 10- K filed April 12, 2006 and our Quarterly Report on Form 10-Q filed December 6, 2006. In light of these risks and uncertainties, the future events, developments or results described by our forward-looking statements in this document could turn out to be materially and adversely different from those we discuss or imply. We are not obligated to release publicly any revisions to any forward-looking statements contained in this press release to reflect events or circumstances occurring after the date of this report and you should not expect us to do so.

CONTACT:	Dollar Tree Stores, Inc., Chesapeake
	Timothy J. Reid
	757-321-5284
	www.DollarTree.com

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