Dollar General 2011 Annual Report Download - page 66

Proxy
In this proxy statement, we sometimes refer to these awards as ‘‘Other Stock-Based Awards.’’
The Committee will determine the form, terms and conditions of Other Stock-Based Awards, including
vesting provisions and whether such awards will be settled in shares, in cash, or in a combination of
shares and cash. Other Stock-Based Awards may be granted alone or in connection with any other
awards under the plan, and may provide for vesting upon the completion of a specified period of
service, the occurrence of an event, and/or the attainment of performance objectives.
Other Stock-Based Awards may be granted in a manner intended to qualify as performance-
based compensation meeting the requirements of Section 162(m). To qualify as performance-based:
• the compensation must be paid solely on account of the attainment of one or more
pre-established, objective performance goals;
• the performance goal(s) under which compensation is paid must be established by a
committee comprised solely of two or more directors who qualify as outside directors for
purposes of the exception;
• the material terms under which the compensation is to be paid must be disclosed to and
approved by shareholders before payment is made in a separate vote; and
• the Committee must certify in writing before payment of the compensation that the
performance goal(s) and any other material terms were in fact satisfied.
Under the Internal Revenue Code, a director is an ‘‘outside director’’ if he or she is not a
current employee of Dollar General; is not a former employee who receives compensation for prior
services (other than under a qualified retirement plan); has not been an officer of Dollar General; and
does not receive, directly or indirectly (including amounts paid to an entity that employs the director or
in which the director has at least a 5% ownership interest), remuneration from Dollar General in any
capacity other than as a director.
Under the 2007 Stock Incentive Plan, the Committee may base the objective performance goals
on one or more of the following business criteria, which may relate to Dollar General, to one or more
of our affiliates, to one or more of our or our affiliates’ divisions or units, or to any combination of the
foregoing:
• net earnings or net income (before or after taxes) • expense targets
• earnings per share • margins
• net sales or revenue growth • operating efficiency
• gross or net operating profit • customer satisfaction
• return measures (including, but not limited to, • working capital targets
return on assets, capital, invested capital, equity, • economic value added
sales, or revenue) • volume
• cash flow (including, but not limited to, operating • capital expenditures
cash flow, free cash flow, and cash flow • market share
return on capital) • costs
• earnings before or after taxes, interest, • regulatory ratings
depreciation, and/or amortization • asset quality
• gross or operating margins • net worth
• productivity ratios • safety
• share price (including, but not limited to, growth
measures and total shareholder return)
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