Dollar General 2012 Annual Report Download - page 29

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What related-party transactions existed in 2012 or are planned for 2013?
We describe below the transactions that have occurred since the beginning of 2012, and any
currently proposed transactions, that involve Dollar General and exceed $120,000, and in which a
related party had or has a direct or indirect material interest. In addition, we describe below certain
other relationships between Dollar General and related parties in which a related party has an interest
that may not be material.
Relationships with Management. Simultaneously with the closing of our 2007 merger and
thereafter through May 2011, we, Buck Holdings L.P. and certain of our employees (collectively,
‘‘management shareholders’’) entered into shareholder’s agreements (each, a ‘‘Management
Stockholder’s Agreement’’) that impose significant restrictions on transfer of covered shares of our
common stock held by the management shareholders. Generally, shares are nontransferable prior to the
fifth anniversary of either the closing date of our 2007 merger or a later specified date (depending on
the terms of the applicable agreement) except (i) sales pursuant to an effective registration statement
filed by us under the Securities Act of 1933 (the ‘‘Securities Act’’) in accordance with the Management
Stockholder’s Agreement, (ii) a sale to certain permitted transferees, or (iii) as otherwise permitted by
our Board of Directors or pursuant to a waiver of the transfer restrictions; provided, that, in the event
KKR or its affiliates transfer their limited partnership units to a third party, such transfer restrictions
shall lapse with respect to the same proportion of shares of common stock owned by a management
shareholder as the proportion of limited partnership units transferred by KKR and such affiliates
relative to the aggregate number of limited partnership units they owned prior to such transfer.
Following our initial public offering in 2009, we amended the Management Stockholder’s Agreements
to exclude from the transfer restrictions any shares acquired in the open market or through the
directed share program administered as part of the initial public offering. Shares acquired by executive
officers in the open market or through the directed share program will still be subject to any lock-up
arrangements with the underwriters of any public offering of shares. Limited waivers of the transfer
restrictions on a certain percentage of the shares subject to the Management Stockholder’s Agreement
have been granted since 2009, and a complete waiver of all remaining transfer restrictions, including
those applicable to Mr. Vasos and to two other of our Executive Vice Presidents, Messrs. Flanigan and
Ravener, was granted on February 1, 2013. These transfer restrictions had expired for a significant
number of management shareholders, including some of our executive officers (Messrs. Dreiling and
Tehle and Mss. Lanigan and Elliott) in July 2012.
In the event that a registration statement is filed with respect to our common stock, the
Management Stockholder’s Agreement prohibits management shareholders from selling shares not
included in the registration statement from receipt of notice that we have filed or intend to file such
registration statement until 180 days (in the case of an initial public offering) or 90 days (in the case of
any other public offering) of the effective date of the registration statement, unless the underwriters, if
any, agree to a shorter period. The Management Stockholder’s Agreement also enables the
management shareholder to cause us to repurchase his or her covered stock and vested options in the
event of his or her death or disability, and enables us to cause the management shareholder to sell his
or her covered stock or options to us upon certain termination events, all for the period of time
specified in the Management Stockholder’s Agreement. These put and call rights expired for a
significant number of the management shareholders, including some of our executive officers
(Messrs. Dreiling and Tehle and Mss. Lanigan and Elliott), in July 2012 and are scheduled to expire for
our remaining covered executive officers at various points in 2013.
Certain members of senior management, including our executive officers other than Mr. Sparks
(the ‘‘Senior Management Shareholders’’), have limited ‘‘piggyback’’ registration rights with respect to
their shares of our common stock in the event that certain investors sell, or cause to be sold, shares of
our common stock in a public offering. Such rights may be voluntarily extended to other members of
management as determined by our Board in connection with any given future such sale by certain
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