Dollar General 2011 Annual Report Download - page 16

Proxy
The KKR Shareholders also have the right to designate one member to our CNG Committee
for as long as they have the right to designate at least one director to our Board, as long as such right
is permitted under applicable NYSE listing standards. Under current NYSE listing standards, this right
is anticipated to cease on April 2, 2013.
In addition, our employment agreement with Mr. Dreiling requires Dollar General to
(1) nominate him to serve as a member of our Board each year that he is slated for reelection to the
Board; and (2) recommend to the Board that Mr. Dreiling serve as Chairman of the Board. Our failure
to do so would give rise to a breach of contract claim.
How are nominees evaluated; what are the minimum qualifications?
Subject to the shareholders’ agreement and Mr. Dreiling’s employment agreement discussed
above, the CNG Committee is charged with recommending to the Board only those candidates that it
believes are qualified to become Board members consistent with the criteria for selection of new
directors adopted from time to time by the Board. We have a written policy to strive to have a Board
representing diverse experience at policy-making levels in areas that are relevant to our business. To
implement this policy, the CNG Committee assesses diversity by evaluating each candidate’s individual
qualifications in the context of how that candidate would relate to the Board as a whole. The CNG
Committee will periodically assess the effectiveness of this policy by considering whether the Board as a
whole represents such diverse experience and recommending to the Board changes to the criteria for
selection of new directors as appropriate. In connection with the ongoing director search, the CNG
Committee will continue to assess the diversity of experience of the Board and any newly-identified
director candidate. The CNG Committee recommends candidates, including those submitted by
shareholders, only if it believes the candidate’s knowledge, experience and expertise would strengthen
the Board and that the candidate is committed to representing the long-term interests of all Dollar
General shareholders.
The CNG Committee assesses a candidate’s independence, background and experience, as well
as the current Board’s skill needs and diversity. With respect to incumbent directors selected for
re-election, the CNG Committee assesses each director’s meeting attendance record and the suitability
of continued service. In addition, individual directors and any nominee should be in a position to
devote an adequate amount of time to the effective performance of director duties and possess the
following characteristics: integrity and accountability, informed judgment, financial literacy, a
cooperative approach, a record of achievement, loyalty, and the ability to consult with and advise
management.
What particular experience, qualifications, attributes or skills led the Board of Directors to conclude
that each nominee should serve as a director of Dollar General?
Our Board of Directors believes that each of the nominees can devote an adequate amount of
time to the effective performance of director duties and possesses the minimum qualifications identified
above. The Board has determined that the nominees, as a whole, complement each other, meet the
Board’s skill needs, and represent diverse experience at policy-making levels in areas relevant to our
business. The Board also considered the following in determining that the nominees should serve as
directors of Dollar General:
•Mr. Agrawal, who was nominated by the KKR Shareholders pursuant to the shareholders’
agreement, has over 10 years of experience in managing and analyzing companies owned by
private equity companies, including over 4.5 years with Dollar General. He has a strong
understanding of corporate finance and strategic business planning activities that are unique
to highly-leveraged companies such as Dollar General. While serving as a member of KKR’s
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