Dollar General 2008 Annual Report Download - page 137

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135
Committee believed that a threshold level of 95% of target was more consistent with other
companies within the KKR portfolio.
Unlike the Teamshare program in prior years, there was no maximum level of EBITDA
performance associated with the 2008 Teamshare program. The Committee felt that setting a
maximum EBITDA performance level could discourage employees to strive to achieve EBITDA
results beyond the maximum level.
The Committee considered the 2008 Teamshare program target financial performance
level to be challenging and generally consistent with the level of difficulty of achievement
associated with the our performance-based awards for prior years. We did not achieve the
threshold Teamshare performance level in fiscal years 2006 or 2005. We achieved Teamshare
performance levels between threshold and target in fiscal years 2004 and 2002, between 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 payout levels, which are consistent with prior years’ payout
levels, were selected because they are within the median range of the Hewitt data for the market
comparator group.
Name
Target Payout Percentage
Mr. Dreiling (1)
100%
Mr. Bere (2)
70%
Mr. Tehle
65%
Ms. Guion
65%
Ms. Lanigan
65%
Mr. Buley
65%
Ms. Lowe
65%
(1) Mr. Dreiling’ s threshold and target bonus percentages are established in his employment
agreement with us, and he was guaranteed a payout at least at the threshold level (50% of his
target level) for fiscal 2008.
(2) Per Mr. Bere’ s April 9, 2008 letter agreement with us (the “Letter Agreement”), to the extent
earned for February and March of 2008, any payout will be based on the Threshold Bonus
(35%), Target Bonus (140%) and Maximum Bonus (280%) levels which were contemplated
in Mr. Bere’ s employment agreement entered into with us in fiscal 2007 (such payout levels
had been settled upon as a result of active renegotiations with Mr. Bere when he assumed the
position of Interim CEO and were deemed necessary to secure the critical services of Mr.
Bere at that time). We entered into the Letter Agreement at the end of the transition period
which followed Mr. Dreiling’ s hiring in January 2008 and ran through the date of the Letter
Agreement (the “Transition Period”). The Committee believed it was fair to use the bonus
payout levels that were in place under the employment agreement during the Transition
Period, but to modify those levels for all months after the Transition Period (as reflected in
this table) to reflect the Hewitt data for the market comparator group relative to Mr. Bere’ s
new position of Chief Strategy Officer.