Ross Stores (ROST)

Employment Agreements.

Michael Balmuth. The Company’s current employment agreement with Michael Balmuth, Vice Chairman of the Board, President and Chief Executive Officer, extends through January 29, 2011. The Company recently approved an extension through January 28, 2012. The current employment agreement provides that Mr. Balmuth will receive an annual salary of not less than $988,000, subject to annual increases as part of the Company’s annual review process.

John G. Call. The Company’s current employment agreement with John G. Call, Senior Vice President and Chief Financial Officer, extends through March 31, 2010. The Company recently approved an extension through March 31, 2012. The current agreement provides that Mr. Call will receive an annual salary of not less than $466,000, subject to annual increases as part of the Company’s annual review process.

Barbara Rentler. The Company’s current employment agreement with Barbara Rentler, Executive Vice President, Merchandising, extends through March 31, 2011. The Company recently approved an extension through March 31, 2013. The current agreement provides that Ms. Rentler will receive an annual salary of not less than $750,000, subject to annual increases as part of the Company’s annual review process.

Lisa Panattoni. The Company’s current employment agreement with Lisa Panattoni, Executive Vice President, Merchandising, extends through March 31, 2011. The Company recently approved an extension through March 31, 2013. The current agreement provides that Ms. Panattoni will receive an annual salary of not less than $685,000, subject to annual increases as part of the Company’s annual review process.

Michael O’Sullivan. The Company’s current employment agreement with Michael O’Sullivan, Executive Vice President, Chief Administrative Officer, extends through March 31, 2011. The Company recently approved an extension through March 31, 2013. The current agreement provides that Mr. O’Sullivan will receive an annual salary of not less than $595,000, subject to annual increases as part of the Company’s annual review process.

Employment Agreements.

Michael Balmuth. The Company and Michael Balmuth, Vice Chairman of the Board, President and Chief Executive Officer, entered into an employment agreement on May 31, 2001 that was most recently amended effective April 6, 2007. The current term runs through January 29, 2011. Upon notice from Mr. Balmuth at specified times, the Board will consider extending the term of the employment agreement for successive two-year periods. The employment agreement provides that Mr. Balmuth will receive an annual salary of not less than $988,000, subject to annual increases as part of the Company’s annual review process.

John G. Call. The Company most recently entered into an employment agreement with John G. Call, Senior Vice President and Chief Financial Officer, effective October 1, 2007, which extends through March 31, 2010. The agreement provides that Mr. Call will receive an annual salary of not less than $466,000, subject to annual increases as part of the Company’s annual review process.

Lisa Panattoni. The Company most recently entered into an employment agreement with Lisa Panattoni, Executive Vice President, Merchandising, effective January 1, 2007. The current term extends through March 31, 2011. The agreement provides that Ms. Panattoni will receive an annual salary of not less than $685,000, subject to annual increases as part of the Company’s annual review process.

Barbara Rentler. The Company most recently entered into an employment agreement with Barbara Rentler, Executive Vice President, Merchandising, effective January 1, 2007, which extends through March 31, 2011. The agreement provides that Ms. Rentler will receive an annual salary of not less than $750,000, subject to annual increases as part of the Company’s annual review process.

James S. Fassio. The Company most recently entered into an employment agreement with James S. Fassio, Executive Vice President, Property Development, Construction and Store Design, effective March 22, 2007, which extends through March 31, 2011. The agreement provides that Mr. Fassio will receive an annual salary of not less than $595,000, subject to annual increases as part of the Company’s annual review process.

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Employment Agreements

All NEOs have entered into employment agreements with the Company. The CEO’s contract was last renewed effective May 2005. In March 2007, subsequent to the end of the 2006 fiscal year, the Compensation Committee approved an additional extension of the term of the CEO’s agreement through January 2011. The employment agreements with our other NEOs – Mr. Call, Ms. Panattoni, Ms. Rentler and Mr. Fassio – are subject to two-year renewals if not terminated by either party. (See detailed discussion of NEO contract terms and severance benefits on pages 15 and 22 through 27 of this Proxy Statement.)

We believe these employment agreements benefit both the NEOs and the Company as they allow our executives to focus on their responsibilities and objectives without concern for their employment security in the event of a termination or change in control. All employment agreements for both the CEO and all other executive officers provide for severance benefits under certain events.

We also believe that these employment agreements are an effective retention tool for executives while also providing protection for the Company. The agreements reaffirm protection of our confidential information and trade secrets, as well as post-termination restrictions on recruiting our current associates. These agreements also include limitations on the executive accepting post-termination employment with certain competitors. (See further discussion under “Potential Payments upon Termination or Change in Control”).