Dollar General 2008 Annual Report Download

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 30, 2009
Commission file number:
001-11421
DOLLAR GENERAL CORPORATION
(Exact name of registrant as specified in its charter)
TENNESSEE
(State or other jurisdiction of
incorporation or organization)
61-0502302
(I.R.S. Employer
Identification No.)
100 MISSION RIDGE
GOODLETTSVILLE, TN 37072
(Address of principal executive offices, zip code)
Registrant’s telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act: None
(615) 855-4000
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes [ ] No [X]
Indicate by check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Act. Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best of registrant’ s
knowledge, in definitive proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [X]

Table of contents

  • Page 1
    ..., 2009 Commission file number: 001-11421 DOLLAR GENERAL CORPORATION (Exact name of registrant as specified in its charter) TENNESSEE (State or other jurisdiction of incorporation or organization) 61-0502302 (I.R.S. Employer Identification No.) 100 MISSION RIDGE GOODLETTSVILLE, TN 37072 (Address of...

  • Page 2
    ... [X] The aggregate fair market value of the registrant' s common stock outstanding and held by non-affiliates as of August 1, 2008 was $3,230,750, all of which was owned by employees of the registrant and not traded on a public market. For this purpose, directors, executive officers and greater than...

  • Page 3
    ... that concern our strategy, plans or intentions. For example, all statements relating to our estimated and projected earnings, costs, expenditures, cash flows and financial results, our plans and objectives for future operations, growth or initiatives, or the expected outcome or impact of pending or...

  • Page 4
    ... funds affiliated with Kohlberg Kravis Roberts & Co., L.P. ("KKR" or "Sponsor"), as discussed in more detail under "Our 2007 Merger" below. We have increased our total number of stores from 6,700 on January 30, 2004, to 8,362 on January 30, 2009, a 4.5% compounded annual growth rate ("CAGR"). Over...

  • Page 5
    ... have developed a business strategy of providing our customers with a focused assortment of everyday low priced merchandise in a convenient, small-store format. Our Customers. In general, we locate our stores and base our merchandise selection on the needs of households seeking value and convenience...

  • Page 6
    ... a low-cost operating structure and a focused assortment of merchandise allows us to offer quality merchandise at competitive prices. As part of this strategy, we emphasize even-dollar prices on many of our items. In the typical Dollar General store, the majority of the products are priced at $10...

  • Page 7
    ... has positively impacted customer satisfaction as well as our store employees' ability to manage stores. Project Alpha also encompassed significant improvements to our real estate practices. We have integrated the functions of site selection, lease renewals, relocations, remodels and store closings...

  • Page 8
    ..., 2009. We are the largest player in the U.S. small box deep discount segment based on sales. We believe we are well positioned to further increase our market share as we continue to execute our business strategy and implement our operational initiatives. Our target customers are those seeking value...

  • Page 9
    ... all of 2007 reflect the impact of certain strategic real estate and inventory management initiatives as discussed above in "Overall Business Strategy." Merchandise We separate our merchandise into the following four categories for reporting purposes: highly consumable, seasonal, home products, and...

  • Page 10
    ... The Procter & Gamble Company. Our next largest supplier accounted for approximately 6% of our purchases in 2008. We directly imported approximately 10% of our purchases at cost (14% at retail) in 2008. The Dollar General Store The average Dollar General store has approximately 7,000 square feet of...

  • Page 11
    ... cost operating structure and the relatively limited assortment of products offered. Historically, we have minimized labor by offering fewer price points and a reliance on simple merchandise presentation. We maintain strong purchasing power due to our leadership position in the dollar store retail...

  • Page 12
    Available Information Our Web site address is www.dollargeneral.com. We make available through this address, without charge, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15...

  • Page 13
    ...indentures governing our debt securities. If new indebtedness is added to our current debt levels, the related risks that we now face could intensify. Our debt agreements contain restrictions that limit our flexibility in operating our business. Our Credit Facilities and the indentures governing our...

  • Page 14
    ... sales, decreases in inventory turnover, greater markdowns on inventory, and a reduction in profitability due to lower margins. Many of those factors, as well as commodity rates, transportation costs, costs of labor, insurance and healthcare, foreign exchange rate fluctuations, lease costs, changes...

  • Page 15
    ...and international suppliers. Approximately 10% of our purchases in 2008 were from The Procter & Gamble Company. Our next largest supplier accounted for approximately 6% of our purchases in 2008. We directly imported approximately 10% of our purchases at cost in 2008, but many of our domestic vendors...

  • Page 16
    ... rates, minimum wage laws, health and other insurance costs and changes in employment and labor legislation (including changes in the process for our employees to join a union) or other workplace regulation (including changes in entitlement programs such as health insurance and paid leave programs...

  • Page 17
    ... and international transportation infrastructure that lead to delays or interruptions of service would adversely affect our business. Our planned future growth will be impeded, which would adversely affect sales, if we cannot open new stores on schedule or if we close a number of stores materially...

  • Page 18
    ...highly competitive. We operate in the discount retail merchandise business, which is competitive with respect to price, store location, merchandise quality, assortment and presentation, in-stock consistency, and customer service. This competitive environment subjects us to the risk of adverse impact...

  • Page 19
    ...or other energy) prices or a fuel shortage, the temporary or permanent closure of one or more of our stores or distribution centers, delays in opening new stores, the temporary lack of an adequate work force in a market, the temporary or long-term disruption in the supply of products from some local...

  • Page 20
    ... to make payments under our outstanding notes. The Investors are also in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. The Investors may also pursue acquisition opportunities that are...

  • Page 21
    ... Florida Georgia Illinois Indiana Iowa Kansas Kentucky Louisiana Maryland Michigan Minnesota Mississippi Missouri Number of Stores 465 52 227 21 23 424 476 307 318 171 145 309 332 57 237 16 266 311 State Nebraska New Jersey New Mexico New York North Carolina Ohio Oklahoma Pennsylvania South Carolina...

  • Page 22
    ...is no established public trading market for our common stock. There were approximately 188 shareholders of record of our common stock as of March 17, 2009. Our Board of Directors declared a quarterly dividend in the amount of $0.05 per share payable on or before April 19, 2007 to common shareholders...

  • Page 23
    ... table sets forth selected consolidated financial information of Dollar General Corporation as of the dates and for the periods indicated. The selected historical statement of operations data and statement of cash flows data for the fiscal years or periods, as applicable, ended January 30, 2009...

  • Page 24
    ...post-Merger results of Dollar General Corporation for the period from July 7, 2007 through February 1, 2008. Includes the effects of certain strategic merchandising and real estate initiatives that resulted in the closing of approximately 460 stores and changes in the Company' s inventory management...

  • Page 25
    ... the impact of the business combination and associated purchase price allocation of the merger of Dollar General Corporation and Buck Acquisition Corp. ("Buck"), from July 7, 2007 to February 1, 2008. Buck was formed on March 6, 2007, and its results of operations prior to the Merger, related solely...

  • Page 26
    ... proposition for our customers based on convenient store locations, easy in and out shopping and quality merchandise in a friendly shopping environment at highly competitive prices. We believe our combination of value and convenience distinguishes us from other discount, convenience and drugstore...

  • Page 27
    ...$45.0 million, or 115 basis points, related to closing underperforming stores. We recorded litigation expense of $32 million to reflect the settlement and related expenses, net of insurance proceeds, of a class action lawsuit filed as a result of the Merger in 2007. We determined that the settlement...

  • Page 28
    ... practices and employee retention. In 2008, higher sales volumes contributed to our ability to leverage transportation and distribution costs, and we were able to offset the impact of higher average fuel costs for the year through better trailer utilization, expansion of backhaul opportunities and...

  • Page 29
    ... regard to planned new store openings, our criteria are based on numerous factors including, among other things, availability of appropriate sites, expected sales, lease terms, population demographics, competition, and the employment environment. We use various real estate site selection tools to...

  • Page 30
    ... stores and our merchandise to better serve the needs of our customers. Key Financial Metrics. We have identified the following as our most critical financial metrics for 2008 and 2009 Same-store sales growth / sales per square foot; Gross profit, as a percentage of sales; Inventory turnover; Cash...

  • Page 31
    ... of Dollar General Corporation for the period from July 7, 2007 through February 1, 2008. (b) Includes the pre-Merger results of Dollar General Corporation for the period from February 3, 2007 through July 6, 2007. (c) Includes the impacts of certain strategic real estate and inventory management...

  • Page 32
    ... Financial Information" below. Pro Forma (amounts in millions) Net sales by category: Highly consumable % of net sales Seasonal % of net sales Home products % of net sales Basic clothing % of net sales Net sales Cost of goods sold % of net sales Gross profit % of net sales Selling, general...

  • Page 33
    ... the Executive Overview. Both the number of customer transactions and average transaction amount increased for the year. and we believe that our stores benefited to some degree from attracting new customers who are seeking value as a result of the current economic environment. The net sales increase...

  • Page 34
    ... with our vendors and by increasing retail prices as necessary. On a quarterly basis, we estimate the annual impact of commodity cost fluctuations based upon the best available information at that point in time. The gross profit rate as a percentage of sales was 27.3% in the 2007 Predecessor period...

  • Page 35
    ... the closing of stores and the elimination of our packaway inventory strategy; a $12.0 million loss in the 2007 pro forma period compared to a $5.0 million gain in 2008 relating to possible losses on distribution center leases; and decreases in workers compensation and other insurance-related costs...

  • Page 36
    ... the Merger-related shareholder lawsuit. The income tax rate for the Successor period ended February 1, 2008 is a benefit of 26.9%. This benefit is less than the expected U.S. statutory rate of 35% due to the incurrence of state income taxes in several of the group' s subsidiaries that file their...

  • Page 37
    ... forma condensed consolidated financial information is presented for the Predecessor and Successor relating to the periods preceding and succeeding the Merger, respectively. As a result of the Merger, we applied purchase accounting standards and a new basis of accounting effective July 7, 2007. The...

  • Page 38
    ... Year Ended February 1, 2008 (In thousands) Net sales Cost of goods sold Gross profit Selling, general and administrative Transaction and related costs Operating profit Interest income Interest expense Other (income) expense Income (loss) before income taxes Income tax expense (benefit) Net loss...

  • Page 39
    ... of transaction costs we incurred that were expensed as one-time charges upon the close of the Merger. Such adjustments do not include any adjustments to reflect the effects of our new stock based compensation plan. (d) Reflects pro forma interest expense resulting from our new capital structure as...

  • Page 40
    ... February 2, 2007 has been adjusted to reflect changes required by FIN 48 as if FIN 48 had been adopted as of the beginning of the year. Effects of Inflation In 2008, increased commodity cost pressures mainly related to food and pet products which have been driven by fruit and vegetable prices and...

  • Page 41
    ... base. The tranche A borrowing base equals the sum of (i) 85% of the net orderly liquidation value of all our eligible inventory and that of each guarantor thereunder and (ii) 90% of all our accounts receivable and credit/debit card receivables and that of each guarantor thereunder, in each case...

  • Page 42
    ... fully paid down. Interest Rates and Fees. Borrowings under the Credit Facilities bear interest at a rate equal to an applicable margin plus, at our option, either (a) LIBOR or (b) a base rate (which is usually equal to the prime rate). The applicable margin for borrowings is (i) under the term loan...

  • Page 43
    .... All obligations and related guarantees under the term loan credit facility are secured by: • a second-priority security interest in all existing and after-acquired inventory, accounts receivable, and other assets arising from such inventory and accounts receivable, of our company and each...

  • Page 44
    ... senior secured credit agreements contain a number of covenants that, among other things, restrict, subject to certain exceptions, our ability to: incur additional indebtedness; sell assets; pay dividends and distributions or repurchase our capital stock; make investments or acquisitions; repay...

  • Page 45
    ... the obligations under our Credit Facilities. We may redeem some or all of the notes at any time at redemption prices described or set forth in the indentures. We also may seek, from time to time, to retire some or all of the notes through cash purchases on the open market, in privately negotiated...

  • Page 46
    ...ii) operating cash flows determined in accordance with U.S. GAAP. Additionally, EBITDA and Adjusted EBITDA are not intended to be measures of free cash flow for management' s discretionary use, as they do not consider certain cash requirements such as interest payments, tax payments and debt service...

  • Page 47
    ... rate swaps Contingent (gain) loss on distribution center leases Impact of markdowns related to inventory clearance activities, net of purchase accounting adjustments SG&A related to store closing and inventory clearance activities Operating losses (cash) of stores to be closed Hurricane-related...

  • Page 48
    ...including contractual terms, market prices, yield curves, credit curves, measures of volatility, and correlations of such inputs. For our derivatives, all of which trade in liquid markets, model inputs can generally be verified and model selection does not involve significant management judgment. To...

  • Page 49
    ... agreements for software licenses and support, supplies, fixtures, and merchandise purchases excluding such purchases subject to letters of credit. In 2008 and 2007, our South Carolina-based wholly owned captive insurance subsidiary, Ashley River Insurance Company ("ARIC"), had investments in...

  • Page 50
    .... Our current credit ratings, as well as future rating agency actions, could (1) negatively impact our ability to obtain financings to finance our operations on satisfactory terms; (2) have the effect of increasing our financing costs; and (3) have the effect of increasing our insurance premiums and...

  • Page 51
    ... under "Results of Operations." In addition, we experienced increased inventory turns and improved merchandise payment terms in 2008 as compared to the 2007 periods. Accounts payable balances increased by $140.4 million in 2008 compared to a decline of $41.4 million in the 2007 Successor period and...

  • Page 52
    ... for new stores; $17 million for distribution and transportation-related capital expenditures; and $13 million for information systems upgrades and technology-related projects. During 2008 we opened 207 new stores and remodeled or relocated 404 stores. Purchases and sales of short-term investments...

  • Page 53
    ...repayments, under our new asset-based revolving credit facility of $102.5 million. Cash flows used in financing activities during 2006 included the repurchase of approximately 4.5 million shares of the Predecessor' s common stock at a total cost of $79.9 million, cash dividends paid of $62.5 million...

  • Page 54
    ... of products that is not fairly uniform in terms of its cost and selling price relationship and turnover; applying the RIM to transactions over a period of time that include different rates of gross profit, such as those relating to seasonal merchandise; inaccurate estimates of inventory shrinkage...

  • Page 55
    ... in this testing process may include projecting future cash flows, determining appropriate discount rates and other assumptions. Projections are based on management' s best estimates given recent financial performance, market trends, strategic plans and other available information. Changes in these...

  • Page 56
    ...' compensation, employee health insurance, general liability, property loss and automobile coverage. These costs are significant primarily due to the large employee base and number of stores. At the date of the Merger the liability for workers' compensation and general liability was discounted in...

  • Page 57
    ... consolidated financial statements. Lease Accounting and Excess Facilities. The majority of our stores are subject to shortterm leases (usually with initial or current terms of 3 to 5 years) with multiple renewal options when available. We also have stores subject to build-to-suit arrangements with...

  • Page 58
    ... options are expected to be outstanding, an estimate of the volatility of our stock price (which is based on a peer group of publicly traded companies), applicable interest rates and the dividend yield of our stock. Other factors involving judgments that affect the expensing of share-based payments...

  • Page 59
    ... payments (or receipts) and the discounted expected variable cash receipts (or payments). The variable cash receipts (or payments) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. Derivative Financial Instruments. We account...

  • Page 60
    ... affect an entity' s financial position, results of operations, and cash flows. SFAS 161 is effective as of the beginning of an entity' s first fiscal year that begins after November 15, 2008. We plan to adopt SFAS 161 during the first quarter of our 2009 fiscal year and its impact is expected to be...

  • Page 61
    ... and the underlying exposure being hedged, fluctuations in the value of the financial instruments are generally offset by reciprocal changes in the value of the underlying economic exposure. Interest Rate Risk We manage our interest rate risk through the strategic use of fixed and variable interest...

  • Page 62
    ...-tax earnings and cash flows; whereas a change in interest rates on fixed rate debt impacts the economic fair value of debt but not our pre-tax earnings and cash flows. Our interest rate swaps qualify for hedge accounting as cash flow hedges. Therefore, changes in market fluctuations related to the...

  • Page 63
    ... consolidated financial position of Dollar General Corporation and subsidiaries at January 30, 2009 (Successor) and February 1, 2008 (Successor), and the consolidated results of their operations and their cash flows for the year ended January 30, 2009 (Successor), the periods from March 6, 2007 to...

  • Page 64
    DOLLAR GENERAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands except per share amounts) Successor January 30, 2009 ASSETS Current assets: Cash and cash equivalents Short-term investments Merchandise inventories Income taxes receivable Deferred income taxes Prepaid expenses ...

  • Page 65
    ... July 6, 2007 (reflecting the change in fair value of interest rate swaps), and the post-Merger results of Dollar General Corporation for the period from July 7, 2007 through February 1, 2008. See Notes 1 and 2. The accompanying notes are an integral part of the consolidated financial statements...

  • Page 66
    ...February 2, 312,436 2007 Comprehensive income: Net loss Reclassification of net loss on derivatives Comprehensive loss Cash dividends, $0.05 per common share Issuance of common stock under stock incentive plans 2,496 Tax benefit from stock option exercises Share-based compensation expense Vesting of...

  • Page 67
    ... taxes Tax benefit of stock options Noncash inventory adjustments and asset impairments Noncash share-based compensation Other noncash gains and losses Change in operating assets and liabilities: Merchandise inventories Prepaid expenses and other current assets Accounts payable Accrued expenses...

  • Page 68
    Supplemental cash flow information: Cash paid (received) for: Interest Income taxes Supplemental schedule of noncash investing and financing activities: Purchases of property and equipment awaiting processing for payment, included in Accounts payable Purchases of property and equipment under capital...

  • Page 69
    DOLLAR GENERAL CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Basis of presentation and accounting policies Basis of presentation These notes contain references to the years 2008 and 2006, which represent fiscal years ended January 30, 2009 and February 2, 2007, ...

  • Page 70
    ..., Florida; Zanesville, Ohio; Jonesville, South Carolina and Marion, Indiana. The Company purchases its merchandise from a wide variety of suppliers. Approximately 10% of the Company' s purchases in 2008 were made from The Procter & Gamble Company. The Company' s next largest supplier accounted for...

  • Page 71
    ... interest rates that are generally reset every 28-35 days under an auction system. There were no such investments outstanding as of January 30, 2009 or February 1, 2008. In 2008 and 2007, the Company' s South Carolina-based wholly owned captive insurance subsidiary, Ashley River Insurance Company...

  • Page 72
    ... $ 101,234 On January 30, 2009 and February 1, 2008, these investments were included in the following accounts in the consolidated balance sheets (in thousands): Successor January 30, 2009 Prepaid expenses and other current assets Other assets, net Long-term obligations (see Note 8) Held-toMaturity...

  • Page 73
    ...with its vendors and by increasing retail prices as necessary. On a quarterly basis, the Company estimates the annual impact of commodity cost fluctuations based upon the best available information at that point in time. Store pre-opening costs Pre-opening costs related to new store openings and the...

  • Page 74
    ... when the carrying value of the assets exceeds the undiscounted future cash flows over the life of the lease. The Company' s estimate of undiscounted future cash flows over the lease term is based upon historical operations of the stores and estimates of future store profitability which encompasses...

  • Page 75
    ... a Vendor." Cash consideration received from a vendor is generally presumed to be a rebate or an allowance and is accounted for as a reduction of merchandise purchase costs and classified as a current or long term liability, as applicable, until recognition in the statement of operations at the time...

  • Page 76
    ... lease contract termination liabilities for closed stores, common area and other maintenance charges, store insurance liabilities and income tax related reserves. Insurance liabilities The Company retains a significant portion of risk for its workers' compensation, employee health, general liability...

  • Page 77
    ...) Compensation and benefits Insurance Income tax related reserves Derivatives Other Other liabilities consist primarily of deferred rent, lease contract termination liabilities for closed stores, leasehold interests liabilities, and rebate obligations. Fair value accounting On February 2, 2008...

  • Page 78
    ... the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments (or...

  • Page 79
    ... amounts reflected in the consolidated balance sheets for cash, cash equivalents, short-term investments, receivables and payables approximate their respective fair values. At January 30, 2009, the fair value of the Company' s debt, excluding capital lease obligations, was approximately $3.747...

  • Page 80
    ... of SFAS 123, "Accounting for Stock-Based Compensation," for unvested options granted prior to the adoption date and (b) grant date fair value estimated in accordance with the provisions of SFAS 123(R) for unvested options granted after the adoption date. The Company adopted SFAS 123(R) under...

  • Page 81
    ...Through January 30, 2009, the Company has not recorded any breakage income related to its gift card program. Advertising costs Advertising costs are expensed upon performance, "first showing" or distribution, and are reflected net of qualifying cooperative advertising funds provided by vendors in SG...

  • Page 82
    ... related to uncertain income tax positions was recorded. As of the date of adoption, approximately $27.1 million of the reserve for uncertain tax positions would have impacted the Company' s effective income tax rate subsequently if the Company were to recognize the tax benefit for these positions...

  • Page 83
    ...and related hedged items affect an entity' s financial position, results of operations, and cash flows. SFAS 161 is effective as of the beginning of an entity' s first fiscal year that begins after November 15, 2008. The Company plans to adopt SFAS 161 during the first quarter of 2009 and its impact...

  • Page 84
    ... of the 2006 and 2007 amounts have been made to conform to the 2008 presentation. 2. Merger On March 11, 2007, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with Buck Holdings L.P., a Delaware limited partnership ("Parent"), and Buck, a Tennessee corporation and...

  • Page 85
    The allocation of the purchase price is as follows (in thousands): Cash and cash equivalents Short-term investments Merchandise inventories Income taxes receivable Deferred income taxes Prepaid expenses and other current assets Property and equipment, net Goodwill Intangible assets Other assets, net...

  • Page 86
    ... related to its historical inventory management and real estate strategies, as more fully described below. Inventory management In November 2006, the Company undertook an initiative to discontinue its historical inventory packaway model for virtually all merchandise by the end of fiscal 2007...

  • Page 87
    ...to February 1, 2008. The Company has recorded the following pre-tax costs associated with the closing of these approximately 460 stores (in millions): Total (a) Lease contract termination costs (c) One-time employee termination benefits Other associated store closing costs Inventory liquidation fees...

  • Page 88
    ... at cost and summarized as follows: Successor January 30, February 1, 2009 2008 $ 137,779 $ 137,539 518,933 516,482 117,846 87,343 781,425 645,376 5,025 2,823 1,561,008 1,389,563 292,048 115,318 $ 1,268,960 $1,274,245 (In thousands) Land and land improvements Buildings Leasehold improvements...

  • Page 89
    ... the Merger-related shareholder lawsuit. The income tax rate for the Successor period ended February 1, 2008 is a benefit of 26.9%. This benefit is less than the expected U.S. statutory rate of 35% due to the incurrence of state income taxes in several of the group' s subsidiaries that file their...

  • Page 90
    ... deferred tax assets Deferred tax liabilities: Property and equipment Inventories Trademarks Amortizable assets Insurance related tax method change Other Total deferred tax liabilities Net deferred tax liabilities Successor January 30, February 1, 2009 2008 $ 5,350 4,815 4,830 66,091 23,016 25,327...

  • Page 91
    ...is included in the Company' s reserve for uncertain tax positions. Generally, the Company' s tax years ended in 2005 and forward remain open for examination by the various state taxing authorities. As of January 30, 2009, the total uncertain tax benefits, interest expense related to income taxes and...

  • Page 92
    ... of the uncertain tax positions would impact the Company' s effective income tax rate if the Company were to recognize the tax benefit for these positions. A reconciliation of the uncertain income tax positions from February 3, 2007 (the date of adoption) through January 30, 2009 is as follows: (In...

  • Page 93
    ... Company' s option, either (a) LIBOR or (b) a base rate (which is usually equal to the prime rate). The applicable margin for borrowings is (i) under the term loan facility, 2.75% for LIBOR borrowings and 1.75% for base-rate borrowings (ii) as of January 30, 2009 and February 1, 2008, respectively...

  • Page 94
    ... base. Beginning September 30, 2009, the Company is required to repay installments on the loans under the term loan credit facility in equal quarterly principal amounts in an aggregate amount per annum equal to 1% of the total funded principal amount at July 6, 2007, with the balance payable...

  • Page 95
    ... asset-based revolving credit facility, with excess availability under that facility of $932.8 million and $769.2 million. As of January 30, 2009 and February 1, 2008, the Company had $2.3 billion outstanding under the term loan facility. In addition, on July 6, 2007, in conjunction with the Merger...

  • Page 96
    ... the swaps of $1.7 million during the same time period. In October 2008 the Company terminated one of the interest rate swaps entered into by Buck in April 2007 with a notional amount equal to $486.7 million as of the date of termination. The termination was the result of the bankruptcy declaration...

  • Page 97
    ... million during 2008 and the 2007 Successor period, respectively. In February 2009, the Company entered into a contract to hedge approximately 50% of its anticipated 2009 fuel usage related to the transportation of merchandise. Such contract is not expected to qualify for hedge accounting treatment...

  • Page 98
    ... recorded in the consolidated balance sheets. In August 2007, the Company purchased a secured promissory note (the "Ardmore Note") from Principal Life Insurance Company, which had a face value of $34.3 million at the date of purchase and approximated the remaining financing obligation. The Ardmore...

  • Page 99
    ...was filed in the United States District Court for the Northern District of Alabama (Case No. 7:06-cv-01537-LSC) ("Richter") in which the plaintiff alleges that she and other current and former Dollar General store managers were improperly classified as exempt executive employees under the Fair Labor...

  • Page 100
    ...and Dollar General Corporation (Western District of New York, Case No. 6:06-cv-06084-DGL, originally filed on February 9, 2006 and amended on May 12, 2006 ("Brickey")). The Brickey plaintiffs seek to proceed collectively under the FLSA and as a class under New York, Ohio, Maryland and North Carolina...

  • Page 101
    ... Pay Act. The Company opposed plaintiffs' motion. On November 30, 2007, the court conditionally certified a nationwide class of females under the Equal Pay Act who worked for Dollar General as store managers between November 30, 2004 and November 30, 2007. The notice was issued on January 11, 2008...

  • Page 102
    ...Dollar General Corporation, et al., Case No.1:08-cv-01298 JDB) in which the plaintiff, on behalf of herself and a putative class of nonexempt store employees, alleges that the Company violated the Fair Labor Standards Act by failing to pay for all hours worked, including overtime hours. At this time...

  • Page 103
    ..., for matching contributions. The Merger did not significantly impact the comparability of such expense amounts between periods. The Company also has a nonqualified supplemental retirement plan ("SERP") and compensation deferral plan ("CDP"), called the Dollar General Corporation CDP/SERP Plan, for...

  • Page 104
    a select group of management and highly compensated employees. The supplemental retirement plan is a noncontributory defined contribution plan with annual Company contributions ranging from 2% to 12% of base pay plus bonus depending upon age plus years of service and job grade. Under the CDP, ...

  • Page 105
    ... payable upon a "change in control" of the Company, as defined by the Plan. As a result of the Merger, which constituted a change in control under the Plan, all accounts held in the Deferred Compensation Plan for Non-Employee Directors were distributed. 10. Share-based payments The Company accounts...

  • Page 106
    ... exercise price of each in-the-money option. Additionally, each restricted stock and restricted stock unit holder received $22.00 in cash, without interest and less applicable withholding taxes. Certain stock options held by Company management were exchanged for new options to purchase common stock...

  • Page 107
    ... and the exercise price of any Rollover Options that they hold. This repurchase right existed for a period of 365 days following termination of employment within the required timeframe. As noted above, each of the shares, whether held by general members of management or executive officers, has been...

  • Page 108
    ...vesting of such rights is based upon continued employment and either a change in control of the Company or a qualified public offering as defined in the Rights Plan. Through January 30, 2009, no compensation expense related to the Rights Plan had been recognized based primarily on the uncertainty of...

  • Page 109
    ... price changes from the date of grant over a past period representative of the expected life of the options to determine volatility. Subsequent to the Merger the expected volatilities have been based upon the historical volatilities of a peer group of four companies, as the Company' s common stock...

  • Page 110
    ...period ended July 6, 2007 and year ended February 2, 2007 under the terms of the Company' s pre-Merger stock incentive plan were non-qualified stock options issued at a price equal to the fair market value of the Company' s common stock on the date of grant, were originally scheduled to vest ratably...

  • Page 111
    ..., and there is no change in control, no compensation cost relating to these Performance Options will be recognized and any compensation cost recognized to date will be reversed. In January 2008, the Company granted 890,000 nonvested restricted shares to its Chief Executive Officer. These shares vest...

  • Page 112
    ... secured term loan during 2008. The Company paid $0.2 million to Citicorp North America, Inc. for its services relating to this facility in 2008 as further discussed in Note 6. Goldman, Sachs & Co. is a counterparty to an amortizing interest rate swap totaling $433.3 million as of January 30, 2009...

  • Page 113
    Executive Officer of Capstone served on the Company' s Board of Directors until March 2009. Although neither KKR nor any entity affiliated with KKR owns any of the equity of Capstone, prior to January 1, 2007 KKR had provided financing to Capstone. The aggregate fees incurred for Capstone services ...

  • Page 114
    ... (reflecting the change in fair value of interest rate swaps), and the post-Merger results of Dollar General Corporation for the period from July 7, 2007 through February 1, 2008. See Notes 1 and 2. As discussed in Note 1, in the second, third, and fourth quarters of 2008, the Company recorded LIFO...

  • Page 115
    ... of 2008, the Company recorded net additional pre-tax expenses of $3.3 million related to underperforming stores closed in fiscal years 2006 and 2007. These additional expenses are related to re-evaluation of the existing lease contract termination liabilities based on current market conditions...

  • Page 116
    SUCCESSOR DOLLAR GENERAL CORPORATION BALANCE SHEET: ASSETS Current assets: Cash and cash equivalents Merchandise inventories Income tax receivable Deferred income taxes Prepaid expenses and other current assets Total current assets Net property and equipment Goodwill Intangible assets Deferred ...

  • Page 117
    SUCCESSOR DOLLAR GENERAL CORPORATION BALANCE SHEET: ASSETS Current assets: Cash and cash equivalents Short-term investments Merchandise inventories Income tax receivable Deferred income taxes Prepaid expenses and other current assets Total current assets Net property and equipment Goodwill ...

  • Page 118
    ... (2,788) 194,403 86,221 108,182 $ $ $ $ $ SUCCESSOR DOLLAR GENERAL CORPORATION STATEMENTS OF OPERATIONS: Net sales Cost of goods sold Gross profit Selling, general and administrative Transaction and related costs Operating profit (loss) Interest income Interest expense Other (income) expense...

  • Page 119
    PREDECESSOR DOLLAR GENERAL CORPORATION STATEMENTS OF OPERATIONS: Net sales Cost of goods sold Gross profit Selling, general and administrative Transaction and related costs Operating profit (loss) Interest income Interest expense Income (loss) before income taxes Income taxes Equity in subsidiaries'...

  • Page 120
    ...: Merchandise inventories Prepaid expenses and other current assets Accounts payable Accrued expenses and other Income taxes Other Net cash provided by (used in) operating activities Cash flows from investing activities: Purchases of property and equipment Purchases of short-term investments Sales...

  • Page 121
    ... in operating assets and liabilities: Merchandise inventories Prepaid expenses and other current assets Accounts payable Accrued expenses and other Income taxes Other Net cash provided by (used in) operating activities Cash flows from investing activities: Merger, net of cash acquired Purchases of...

  • Page 122
    ...Merchandise inventories Prepaid expenses and other current assets Accounts payable Accrued expenses and other Income taxes Other Net cash provided by operating activities Cash flows from investing activities: Purchases of property and equipment Purchases of short-term investments Sales of short-term...

  • Page 123
    ...Merchandise inventories Prepaid expenses and other current assets Accounts payable Accrued expenses and other Income taxes Other Net cash provided by operating activities Cash flows from investing activities: Purchases of property and equipment Purchases of short-term investments Sales of short-term...

  • Page 124
    ... that permit us to provide only management' s report in this annual report. (c) Changes in Internal Control Over Financial Reporting. There have been no changes during the quarter ended January 30, 2009 in our internal control over financial reporting (as defined in Exchange Act Rule 13a-15...

  • Page 125
    ...Board of Directors. Under the 2009 Teamshare Program, the named executive officers will be eligible to receive a cash bonus payment equal to a certain percentage of base salary based upon the Company' s achievement in fiscal 2009 of a pre-established financial performance measure based upon earnings...

  • Page 126
    ... performance with the bonus program. For fiscal 2008, we achieved a Teamshare performance level of approximately 218% of the target. The bonus payable to each named executive officer if we reach the 2009 target financial performance level is equal to the applicable percentage, as set forth in the...

  • Page 127
    ... her bonus target. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE (a) Information Regarding Directors and Executive Officers. Information regarding our current directors and executive officers as of March 17, 2009 is set forth below. Each of our directors holds office for...

  • Page 128
    ... is currently on the board of directors of Biomet, Inc., Education Management Corporation, HealthMarkets, Inc. and Signature Hospital, LLC. He has been a member of our Board of Directors since July 2007. Mr. Dreiling joined Dollar General in January 2008 as Chief Executive Officer and a member of...

  • Page 129
    ... joined Dollar General in December 2006 as President and Chief Operating Officer. He also served as our Interim Chief Executive Officer from July 6, 2007 to January 21, 2008. In April 2008, he was named President and Chief Strategy Officer. He served as a member of our Board of Directors from 2002...

  • Page 130
    ... food products from Safeway distribution centers to all retail outlets, inbound traffic and transportation. He also held distribution and logistics leadership positions at Vons - a Safeway company, Specialized Distribution Management Inc., and Crum & Crum Logistics. Mr. Ravener joined Dollar General...

  • Page 131
    ... to Dollar General Corporation, c/o Investor Relations Department, 100 Mission Ridge, Goodlettsville, TN 37072. We intend to provide any required disclosure of an amendment to or waiver from the Code that applies to our principal executive officer, principal financial officer, principal accounting...

  • Page 132
    ... agreements also provide for standard protections to both the officer and to Dollar General should the officer' s employment terminate. Named Executive Officer Compensation Process Oversight. The Compensation Committee of our Board of Directors is responsible for recommending CEO compensation to our...

  • Page 133
    ... HR Officer"), as well as with non-executive members of our human resources group, both with respect to management' s work in connection with named executive officer compensation (as described below under "Management' s Role") and in connection with general employee compensation and benefits matters...

  • Page 134
    ...2007 or at the time they were employed, as applicable, is sufficiently retentive and otherwise adequately meets our compensation objectives as discussed under "Long-Term Incentive Program" below. Elements of 2008 Named Executive Officer Compensation We provide compensation in the form of base salary...

  • Page 135
    ... of any salary increase was determined on the basis of benchmarking information from Hewitt regarding the compensation and role of each named executive officer within our management structure in comparison to the compensation that companies in our market comparator group provide to similarly...

  • Page 136
    ... provides an opportunity for each named executive officer to receive a cash bonus payment equal to a certain percentage of base salary based upon Dollar General' s achievement of a pre-established financial performance measure. As it did in 2007, the Compensation Committee selected as the 2008...

  • Page 137
    ... target and maximum in fiscal year 2007, and at maximum in fiscal year 2003. The bonus payable to each named executive officer if Dollar General reached the 2008 target financial performance level was equal to the applicable percentage of each officer' s salary as set forth in the chart below. Such...

  • Page 138
    ... EBITDA increase over 110%, each named executive officer was eligible to receive an additional 7.1491% of his or her bonus target. Individual awards are capped at $2.5 million per the terms of the plan under which our Teamshare program operates. This pro ration schedule, through 110% of the target...

  • Page 139
    ...a maximum level of EBITDA performance under the 2009 Teamshare program. The bonus payable to each named executive officer if Dollar General reaches the 2009 target financial performance level is equal to the applicable percentage of each officer' s salary as set forth in the chart below. Such payout...

  • Page 140
    ... financial investment in Dollar General is a prerequisite to eligibility to receive an option grant under the 2007 Plan. In 2007, that personal investment could be made in the form of cash, rollover of stock and/or rollover of in-the-money options issued prior to the Merger. Each named executive...

  • Page 141
    ... benefit opportunities lost due to regulatory limits. We also provide named executive officers with benefits and perquisites as additional forms of compensation that are believed to be consistent and competitive with benefits and perquisites provided to similar positions in our market comparator...

  • Page 142
    ... benefits comparable to the group plan applicable to all salaried employees. Each named executive officer may choose either a leased automobile (for which we pay for gasoline, repairs, service and insurance) or a fixed monthly automobile allowance. We provide a gross-up payment to pay the tax cost...

  • Page 143
    ... stock and options to purchase 2.5 million shares of Dollar General at $5 per share (the fair market value on the grant date). The restricted stock is scheduled to vest upon the earlier to occur of the last day of fiscal 2011, a change in control, an initial public offering, termination without...

  • Page 144
    ... service to Dollar General, we transferred to Ms. Lowe title to her Company-leased automobile in connection with her separation from our employment. In addition, we extended health insurance coverage benefits to Ms. Lowe and her eligible dependents from the date of her employment termination through...

  • Page 145
    ...-based. Because our common stock is not publicly traded, Section 162(m) will not limit the tax deductibility of any executive compensation for 2008. The Compensation Committee administers our compensation programs with the good faith intention of complying with Section 409A of the Internal...

  • Page 146
    ... basis over the restriction period based on the market price of the underlying stock on the grant date. There were no forfeitures of restricted stock or RSUs held by the named executive officers during fiscal 2008, fiscal 2007 or fiscal 2006. For more information regarding the assumptions used in...

  • Page 147
    ... dividend yield Expected stock price volatility Risk-free interest rate Expected life of options (years) Exercise price Stock price on date of grant For more information regarding the assumptions used in the valuation of these awards, see Note 10 of the annual consolidated financial statements...

  • Page 148
    ... and costs incurred in connection with a medical physical exam. Grants of Plan-Based Awards in Fiscal 2008 The table below sets forth each named executive officer' s annual Teamshare bonus opportunity established for fiscal 2008. Actual bonus amounts earned by each named executive officer for...

  • Page 149
    ... Equity Awards at 2008 Fiscal Year-End The table below sets forth information regarding outstanding equity awards held by our named executive officers as of the end of fiscal 2008, including (1) equity awards granted under our 2007 Stock Incentive Plan; and (2) Rollover Options, as defined and...

  • Page 150
    ...Board at the time of the determination, including a report on material pending and threatened litigation and financial results through the end of the period immediately preceding the date of such valuation. (5) These options were granted under our 2007 Stock Incentive Plan and vested on July 6, 2008...

  • Page 151
    ... stock previously purchased from us by each executive as well as all vested options and Rollover Options held by each executive. All unvested options held by Mr. Buley and Ms. Lowe were automatically cancelled upon the employment terminations. The table below provides information regarding the value...

  • Page 152
    ...of stock that she previously purchased from us at fair market value. Pension Benefits Fiscal 2008 We have omitted the Pension Benefits table as it is inapplicable. Nonqualified Deferred Compensation Fiscal 2008 Information regarding each named executive officer' s participation in our CDP/SERP Plan...

  • Page 153
    ... of the Internal Revenue Code. We currently match base pay deferrals at a rate of 100%, up to 5% of annual salary, with annual salary offset by the amount of match-eligible salary under the 401(k) plan. All named executive officers are 100% vested in all compensation and matching deferrals and...

  • Page 154
    ... employed may request an "unforeseeable emergency hardship" in-service lump sum distribution of vested amounts credited to the participant' s CDP account. Account balances deemed to be invested in the Mutual Fund Options are payable in cash. As a result of the Merger, the CDP/SERP Plan liabilities...

  • Page 155
    ... with any applicable early retirement policy then in effect or as may be approved by our Compensation Committee. Payments Upon Termination Due to Death or Disability In the event of death or disability, with respect to each named executive officer: • The 20% portion of the time-based options that...

  • Page 156
    ... our disability insurance program since the same benefit level is provided to all of our salaried employees. The named executive officer' s CDP/SERP Plan benefit also becomes fully vested (to the extent not already vested) upon his or her death and is payable in a lump sum within 60 days after the...

  • Page 157
    ... to the fair market value of the shares underlying the vested options, less the aggregate exercise price of the vested options, the named executive officer generally may exercise vested options for a period of 180 days (90 days in the case of Rollover Options) from the termination date. Any unvested...

  • Page 158
    ... bonus plan as in effect on July 6, 2007). A lump sum payment equal to 2 times our annual contribution for the named executive officer' s participation in our medical, dental and vision benefits program (in the case of Mr. Dreiling, the medical, dental and vision benefit instead will be in the form...

  • Page 159
    ...the information remains a trade secret under applicable law and (b) confidential information for a period of 2 years following the employment termination date. For a period of 2 years after the employment termination date, the named executive officer may not accept or work in a "competitive position...

  • Page 160
    ... grant date, depending upon the executive officer) of the excess of the fair market value of one of our shares over the per share Base Price, minus (z) the per share exercise price of a Rollover Option. Payments Upon Involuntary Termination The payments to be made to a named executive officer upon...

  • Page 161
    ...a lump sum payment equal to the sum of (x) 2 times the named executive officer' s annual base salary plus 2 times the named executive officer' s target incentive bonus, each as in effect immediately prior to the change-in-control (or in each case, if greater, at the employment termination date) plus...

  • Page 162
    ... CDP/SERP Plan and the named executive officers' (other than Messrs. Dreiling and Bere) employment agreements, a change-in-control generally is deemed to occur (as more fully described in those documents): • if any person (other than Dollar General or any of our employee benefit plans) acquires 35...

  • Page 163
    ... or her annual base salary as in effect at the relevant employment termination date, plus (y) 2 times his or her target incentive bonus for fiscal 2008, plus (z) 2 times our annual contribution for his or her participation in our medical, dental and vision benefits program. In lieu of providing Mr...

  • Page 164
    ...the title to her Company-provided vehicle (valued at $32,650), and we extended to her and her eligible dependents coverage under our health benefits plan from the date of her termination through December 31, 2008. Ms. Lowe paid 100% of the premium costs of such extended insurance coverage. Mr. Buley...

  • Page 165
    ... Stock Due to the Event SERP Benefits Prior to the Event SERP Benefits Due to the Event Deferred Comp Plan Balance Prior to and After the Event Cash Severance Health and Welfare Payment Outplacement(3) Section 280(G) Excise Tax and Gross-Up Life Insurance Proceeds Total David M. Tehle Vested Options...

  • Page 166
    ... on outplacement services to recently terminated NEOs. Payments to Mr. Buley in Connection With Termination on April 15, 2008 Vested Options Called by Company SERP Benefits Vested Prior to the Event SERP Benefits Due to the Event Deferred Comp Plan Balance Paid Cash Severance Health and Welfare...

  • Page 167
    ...payment is made. Compensation Committee Interlocks and Insider Participation Each of Messrs. Michael Calbert, Raj Agrawal and Adrian Jones was a member of our Compensation Committee during fiscal 2008. None of these persons was at any time during fiscal 2008 an officer or employee of Dollar General...

  • Page 168
    ... to Dollar General business. We allow directors to travel on the Dollar General airplane for those purposes. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS (a) Equity Compensation Plan Information. The following table sets forth information...

  • Page 169
    ...and thus disclaims beneficial ownership with respect thereto. KKR' s address is c/o Kohlberg Kravis Roberts & Co. L.P., 2800 Sand Hill Road, Suite 200, Menlo Park, CA 94025. (2) Indirectly held through Buck Holdings, L.P. (3) Includes the following number of shares held by the following entities: GS...

  • Page 170
    ... not believe any of our current Board members or Messrs. Bere or Nelson would be considered independent under the listing standards of the New York Stock Exchange, on which our common stock was listed prior to the Merger, either because of service on our management team or relationships with certain...

  • Page 171
    ...Global Supply Chain, and Robert Ravener, Senior Vice President and Chief People Officer, purchased shares of Dollar General common stock that were issued pursuant to our 2007 Stock Incentive Plan, as follows: Name Mr. Vasos Mr. Flanigan Mr. Ravener Effective Date of Purchase 12/19/2008 08/28/2008 08...

  • Page 172
    ...portion of fiscal 2008, Mr. Bere served as a director of Buck Holdings, LLC for which Messrs. Calbert, Agrawal and Jones (our Compensation Committee members) serve as executive officers. Relationships with the Investors. Goldman, Sachs & Co. and KKR provide management and advisory services to us and...

  • Page 173
    ... LP. Funds managed by Citigroup Private Equity LP indirectly own approximately 7% of our common stock. We use Capstone Consulting, LLC, a team of executives who work exclusively with KKR portfolio companies providing certain consulting services. We pay Capstone a monthly fee, currently $210,000...

  • Page 174
    ... compensation or benefit as a result. Transactions where the interest arises solely from share ownership in Dollar General and all of our shareholders receive the same benefit on a pro rata basis. Transactions where the rates or charges are determined by competitive bid. Transactions for services...

  • Page 175
    ... Merger and the subsequent exchange offer Registration Statement on Form S-4 filed with the SEC. Such amounts include fees for services rendered for the fiscal year, notwithstanding when the service was provided and billed. 2008 fees include services relating to the employee benefit plan audit. 2007...

  • Page 176
    ...' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements All schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions, are inapplicable or the information is included in the Consolidated...

  • Page 177
    ... has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DOLLAR GENERAL CORPORATION Date: March 24, 2009 By: /s/ Richard W. Dreiling Richard W. Dreiling, Chairman and Chief Executive Officer We, the undersigned directors and officers of the registrant...

  • Page 178
    ... holders an annual report covering its last fiscal year. In addition, the Registrant has not sent to security holders any proxy statement, form of proxy or other proxy soliciting material since such time as the registration of Registrant' s securities under Section 12 of the Act was terminated...

  • Page 179
    ... Plan of Merger, dated as of March 11, 2007, by and among Buck Holdings, L.P., Buck Acquisition Corp., and Dollar General Corporation (incorporated by reference to Exhibit 2.1 to Dollar General Corporation' s Current Report on Form 8-K dated March 11, 2007, filed with the SEC on March 12, 2007 (file...

  • Page 180
    ... 4.2 to Dollar General Corporation' s Quarterly Report on Form 10-Q for the quarter ended November 3, 2006, filed with the SEC on December 12, 2006 (file number 001-11421)) Tenth Supplemental Indenture, dated as of July 6, 2007, by and among Dollar General Corporation, the guarantors named therein...

  • Page 181
    ... 99 to Dollar General Corporation' s Current Report on Form 8-K dated February 25, 2009, filed with the SEC on February 25, 2009 (file number 001-11421)) Senior Subordinated Indenture, dated July 6, 2007, among Buck Acquisition Corp., Dollar General Corporation, the guarantors named therein and...

  • Page 182
    ...purchasers named therein (incorporated by reference to Exhibit 4.10 to Dollar General Corporation' s Current Report on Form 8-K dated July 6, 2007, filed with the SEC on July 12, 2007 (file number 001-11421)) Registration Rights Agreement, dated July 6, 2007, among Buck Holdings, L.P., Buck Holdings...

  • Page 183
    Dollar General Corporation' s Current Report on Form 8-K dated July 6, 2007, filed with the SEC on July 12, 2007 (file number 001-11421)) 4.29 Supplement No.1, dated as of September 11, 2007, to the Security Agreement, between DC Financial, LLC, as New Grantor, and Citicorp North America, Inc., as ...

  • Page 184
    ... Corporation' s Current Report on Form 8-K dated May 29, 2008, filed with the SEC on June 2, 2008 (file number 001-11421))* Form of Stock Option Agreement between Dollar General Corporation and officers of Dollar General Corporation granting stock options pursuant to the 2007 Stock Incentive Plan...

  • Page 185
    ... between Buck Holdings, L.P. and certain officerlevel employees, dated July 6, 2007 (incorporated by reference to Exhibit 10.5 to Dollar General Corporation' s Registration Statement on Form S-4, filed with the SEC on December 21, 2007 (file number 333-148320))* 1998 Stock Incentive Plan (As...

  • Page 186
    ... Summary of Dollar General Corporation Life Insurance Program as Applicable to Executive Officers (incorporated by reference to Exhibit 10.19 to Dollar General Corporation' s Annual Report on Form 10-K for the fiscal year ended February 2, 2007, filed with the SEC on March 29, 2007) (file number 001...

  • Page 187
    ... reference to Exhibit 10.1 to Dollar General Corporation' s Current Report on Form 8-K dated July 6, 2007, filed with the SEC on July 12, 2007 (file number 001-11421))* 10.25 Extension of Initial Term of Employment Agreement, dated December 27, 2007, between Dollar General Corporation and David Ber...

  • Page 188
    ... Holdings, L.P., Dollar General Corporation, Kohlberg Kravis Roberts & Co L.P., and Goldman, Sachs & Co. (incorporated by reference to Exhibit 10.26 to Dollar General Corporation' s Registration Statement on Form S-4, filed with the SEC on December 21, 2007 (file number 333148320)) 10.44 Purchase...

  • Page 189
    24 31 32 * Powers of Attorney (included as part of the signature pages hereto) Certifications of CEO and CFO under Exchange Act Rule 13a-14(a) Certifications of CEO and CFO under 18 U.S.C. 1350 Management Contract or Compensatory Plan 187