Dollar General 2011 Annual Report Download - page 43

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• Payment of the premiums on certain personal long-term disability insurance policies (which
was also required under the prior agreement).
• Reimbursement of reasonable legal fees, up to $15,000 and grossed up for all federal and
state income and employment taxes (and for such taxes on such gross-up payment) to the
extent any such amount is taxable to Mr. Dreiling, incurred by him in connection with any
legal consultation regarding the amended employment agreement.
Severance Arrangements
As noted above, we have an employment agreement with each of our named executive officers
that, among other things, provides for such executive’s rights upon a termination of employment. We
believe that reasonable severance benefits are appropriate to protect the named executive officer
against circumstances over which he or she does not have control and as consideration for the promises
of non-disclosure, non-competition, non-solicitation and non-interference that we require in our
employment agreements. A change in control, by itself, does not trigger any severance provision
applicable to our named executive officers, except for the provisions related to long-term equity
incentives under our 2007 Stock Incentive Plan.
Retirement Agreement with Ms. Guion
Ms. Guion intends to retire from employment with the Company effective July 31, 2012 (the
‘‘Retirement Date’’). We entered into a Retirement Agreement with Ms. Guion, dated as of July 20,
2011 (the ‘‘Retirement Agreement’’), in order to set forth the terms of her employment through the
Retirement Date, the transition of her current duties, and her role and responsibilities with the
Company through the Retirement Date. Key compensatory provisions of the Retirement Agreement
include:
• Through the Retirement Date, and except as otherwise provided in the Retirement
Agreement, Ms. Guion will maintain her current base salary, retain coverage under all
employee benefit plans, and be entitled to all welfare, pension and fringe benefits to which
she was entitled immediately prior to the date of the Retirement Agreement.
• Ms. Guion is not eligible to participate in any Company bonus program, including
Teamshare, for fiscal year 2012, nor is she eligible to receive equity grants in 2012.
• Promptly following the Retirement Date, Ms. Guion will receive (i) any unpaid base salary
accrued through the Retirement Date and (ii) the amount of any unreimbursed business
expenses incurred in accordance with our policy prior to the Retirement Date. She shall also
be entitled to any other vested and accrued benefits under our CDP/SERP and 401(k) plan.
• We will continue to provide to Ms. Guion the financial planning perquisite through April 15,
2013.
• Ms. Guion’s July 6, 2007 Stock Option Agreement will be amended effective as of the
Retirement Date, if she remains employed through the Retirement Date, to allow exercise of
the outstanding vested options at any time through July 31, 2015.
• Ms. Guion’s July 6, 2007 Management Stockholder’s Agreement will terminate effective as of
the Retirement Date if Ms. Guion remains employed through the Retirement Date.
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