Dollar General 2011 Annual Report Download - page 67

Proxy
The criteria listed above may be measured on an absolute basis, on a basis relative to one or
more peer group companies or indices, or any combination of the foregoing, all as the Committee shall
determine. In addition, to the extent consistent with Section 162(m) (or any successor section), the
performance goals may be calculated without regard to extraordinary or non-recurring items, as the
Committee may determine in its sole discretion.
Subject to adjustment in connection with certain significant corporate events, the maximum
number of shares of our common stock that can be awarded under the plan in the form of Other
Stock-Based Awards to any participant is 1.5 million per fiscal year. In addition, Other Stock-Based
Awards granted in a manner intended to qualify for the exemption from the compensation deductibility
limitation imposed by Section 162(m) are considered ‘‘performance-based awards.’’ The maximum
amount of a ‘‘performance-based award’’ denominated in shares of our common stock that may be
granted during a calendar year to any participant is 24 million.
The list of objective performance goals on which ‘‘performance-based awards’’ may be based
under the 2007 Stock Incentive Plan must be approved by our shareholders at least every five years (or
earlier if the goals are changed) in order for compensation based on these goals to be considered
performance-based compensation under Section 162(m). Approval of the material terms will restart the
period for re-approval for an additional five-year period.
The foregoing notwithstanding, in its discretion, the Committee may also use other
performance goals for awards under the plan that are not intended to qualify as performance-based
compensation under Section 162(m).
Dividend Equivalent Rights. The Committee may grant to participants, either alone or in
connection with the grant of another award (other than unearned performance shares), and determine
the terms of, dividend equivalent rights. A dividend equivalent right is the right to receive a payment in
respect of one share of our common stock that is equal to the amount of any dividend paid in respect
of one share of our common stock held by a Dollar General shareholder.
Amendment or Termination of the Plan. The Board of Directors generally may terminate the
2007 Stock Incentive Plan at any time and for any reason. The Board of Directors may amend the plan,
except that shareholder approval will be required for any such amendment to become effective if
(1) required by the Internal Revenue Code or other applicable law, rule or regulation; or (2) the
amendment increases the aggregate number of shares available for awards under the plan, decreases
the exercise price of outstanding stock options or stock appreciation rights, changes the requirements
relating to the Committee or extends the term of the plan. No termination or amendment of the plan
may, without the participant’s consent, adversely affect a participant in more than a minimal manner
with respect to any awards then outstanding.
Amendments of Awards. The Committee may amend the terms and conditions of any
outstanding awards consistent with the terms of the plan, except that a participant’s consent would be
required to modify an outstanding award in a manner that adversely impacts, other than in a de
minimis manner, a participant (other than adjustments pursuant to a change in control of Dollar
General (as defined in the plan) or pursuant to certain corporate events affecting our equity securities
or the value of our equity securities or changes made pursuant to Section 409A of the Internal
Revenue Code), unless such modification is provided for or contemplated in the terms of the award
agreement or the plan.
Effect of Certain Corporate Transactions. In the event of a change in control of Dollar General,
the Committee may accelerate the vesting of any outstanding awards, cancel outstanding awards for fair
value (as determined in its sole discretion), substitute new awards that will substantially preserve the
otherwise applicable terms and value of the awards being substituted, or provide for a period of at least
10 business days prior to the change in control in which any stock option or stock appreciation right
59