The branches of Dollar Tree's settlement

Dollar Tree's board reshuffle shows that activist hedge funds come in all shapes and sizes, and that the quality of a board slate plays a huge role in deciding whether a proxy fight is worth the trouble or not.

Why it matters: Activists continue to descend upon retail companies and the outcomes of these fights can play a huge role in whether the banner emerges a stronger player or a shell of itself.

Catch up fast: Mantle Ridge, which had launched a Dollar Tree proxy fight, is not your typical activist hedge fund. Unlike most activists that take short-term stakes in anywhere from 10 to dozens of companies, Mantle Ridge raises one big chunk of cash for one long-term investment.

Of note: Many hedge funds allow their own investors to redeem month-to-month so activists in this fund category tend to seek quick home runs (such as pushing for a sale-leaseback or the divestiture of a division) that will jack up a stock.

• Macellum Advisor's proxy fight against Kohl's is an example.

Details: Mantle Ridge's campaign hinged on Dollar Tree making improvements to its Family Dollar division — not selling or spinning it, as a typical activist would want.

Yes, but: As constructive as that all sounds, Mantle Ridge still took the bold step of filing a 13D regarding its stake without much warning (an aggressive move) and launched a slate of new directors (super aggressive), the first major step in a proxy fight.

Zoom out: What the activist wanted (and got) was a refreshed board and the leadership of Rick Dreiling, the former chairman and CEO of rival Dollar General.

The bottom line: Though Dollar Tree initially pushed back against Mantle Ridge, yesterday's settlement (which includes the replacement of six, long-tenured Dollar Tree directors) shows that other investors, and perhaps key members of the management team, recognized that Mantle Ridge's slate was high quality.