Ross Stores (ROST)

In fiscal 2007, non-employee directors were eligible to receive stock options granted automatically under the terms of the Company’s 2004 Equity Incentive Plan. The 2004 Equity Incentive Plan provides that new directors, upon joining the Board, receive an initial option, determined by a formula, for a number of shares equal to a base amount of $300,000 (which increased 3% each fiscal year beginning in 2006), divided by the current market price per share on the date of grant. In addition, the 2004 Equity Incentive Plan provides for the grant of an option to purchase 8,000 shares on May 20, 2004, to each incumbent non-employee director, followed by the annual grant of additional stock options, determined by formula, for a number of shares equal to $250,000 divided by the then current market price per share on the date of the annual stockholders meeting in 2005. The Plan provides that this base amount of $250,000 is to increase by 3% each fiscal year beginning in 2006. During fiscal 2007, each of Ms. Garrett and Messrs. Bjorklund, Bush, Ferber, Moldaw, Orban, and Seiler were granted options under this formula to purchase 8,094 shares of common stock under the 2004 Equity Incentive Plan on May 24, 2007, with an exercise price of $32.77, which was the closing price of the Company’s common stock as reported on NASDAQ on that date. Mr. Froman was granted an initial option to purchase 12,360 shares, with an exercise price of $25.75, which was the closing price of the Company’s common stock as reported on NASDAQ on that date. Mr. Froman resigned from the Board in March 2008.

Chairman of the Compensation Committee (Mr. Orban) received additional annual retainers of $44,000 and $10,000, respectively. The Nominating and Corporate Governance Committee met two times in fiscal 2006; the Compensation Committee met eight times in fiscal 2006; and the Audit Committee met eight times in fiscal 2006.

Non-employee directors are eligible to receive stock options granted automatically under the terms of the Company’s 2004 Equity Incentive Plan. The 2004 Equity Incentive Plan provides that new directors, upon joining the Board, receive an initial option, determined by a formula, for a number of shares equal to a base amount of $300,000 (which increases 3% each fiscal year beginning in 2006), divided by the current market price per share on the date of grant. In addition, the 2004 Equity Incentive Plan provided for the grant of an option to purchase 8,000 shares on May 20, 2004, to each incumbent non-employee director, followed by the annual grant of additional stock options, determined by formula, for a number of shares equal to $250,000 divided by the then current market price per share on the date of the annual stockholders meeting in 2005. The Plan provides that this base amount of $250,000 is increased by 3% each fiscal year beginning in 2006 (i.e., this amount will be $265,225 for the May 24, 2007 option grants). During fiscal 2006, each of Ms. Garrett and Messrs. Bjorklund, Bush, Ferber, Moldaw, Orban, and Seiler were granted options under this formula to purchase 9,351 shares of common stock under the 2004 Equity Incentive Plan on May 18, 2006, with an exercise price of $27.54, which was the closing price of the Company’s common stock as reported on NASDAQ on that date.

For the 2007 fiscal year, non-employee directors will receive an annual retainer of $37,000 (paid quarterly), plus $1,500 for attendance at each Board meeting. Audit and Compensation Committee members will receive $2,000 for attendance at each committee meeting. Nominating and Corporate Governance Committee members will receive $1,000 for attendance at each committee meeting. If more than one committee meeting is held on the same day, each committee member receives payment for only one committee meeting. In addition, the Chairman of the Audit Committee and the Chairman of the Compensation Committee will receive additional annual retainers of $44,000 and $25,000, respectively. Travel expenses are reimbursed.