Exhibit 10.3


FORM OF


OPTION ROLLOVER AGREEMENT


 


OPTION ROLLOVER AGREEMENT dated as of the date indicated on Schedule
I hereto (this “Option Rollover Agreement”) between Dollar General
Corporation, a Tennessee corporation (the “Company”), and the individual
listed on Schedule I hereto (the “Management Stockholder”).


 


WHEREAS, on March 11, 2007, the Company, Buck
Holdings, L.P., a Delaware limited partnership (“Parent”) and Buck Acquisition
Corp., a Tennessee corporation and a direct wholly owned subsidiary of Parent (“Merger
Sub”) entered into an Agreement and Plan of Merger (the “Merger Agreement”),
pursuant to which Merger Sub will merge with and into the Company (the “Merger”)
with the Company continuing as the surviving corporation (the effective time of
such merger, the “Effective Time”);


 


WHEREAS, the Management Stockholder currently holds options to acquire
shares of common stock, par value $0.50 per share, of the Company (“DG
Options”), all of which shall become fully vested upon consummation of the
Merger, pursuant to one or more of the following plans: the Company’s 1993
Employee Stock Incentive Plan, 1995 Employee Stock Incentive Plan, 1995 Stock
Option Plan for Outside Directors, and 1998 Stock Incentive Plan, and
Employment Agreement with David A. Perdue effective as of April 2, 2003
(the “DG Plans”), and has agreed, as of the Effective Time, to retain
certain of such DG Options (the “Rollover Options”) in lieu of receiving
the consideration specified in Section 2.3 of the Merger Agreement with
respect to such options, subject to the terms and conditions of this Option
Rollover Agreement; and


 


WHEREAS, the Management Stockholder desires to make an investment in
the equity securities of the Company in connection with the Merger, and the
Company desires to allow the Management Stockholder to make such an investment.


 


NOW THEREFORE, in consideration of the foregoing, and the covenants and
promises and representations set forth herein, and for other good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged and
accepted, the parties hereto agree, subject to the Company’s acceptance of the
Management Stockholder’s execution of this Agreement, to the following:


 


1.             The Management Stockholder
acknowledges that, in consideration of, among other good and valuable
consideration, including the Management Stockholder’s obligation pursuant to
the Management Stockholder’s Agreement to make an investment in the Company,
the Company has offered the Management Stockholder the opportunity to, among
other good and valuable consideration, satisfy such obligation to invest, in
whole or in part, pursuant to the “roll over” of certain of the DG Options held
by Management Stockholder (the “Rollover”).


 


2.             The Management Stockholder further
acknowledges and agrees that from and after the Effective Time:


 

















 


(a)           pursuant to the terms of the Merger
Agreement and the DG Plans, any DG Options, to the extent not exercised prior
to the Merger and not otherwise part of the Management Stockholder’s Rollover
(such options being the “Cancelled Options”), will be cancelled
immediately prior to the Effective Time and will thereafter represent only the
right to receive a cash
payment equal to the product of (x) the number of shares of common stock
of the Company underlying the options immediately prior to the Effective Time,
multiplied by (y) the amount (if any) by which $22.00 exceeds the per
share option exercise price relating
to such Cancelled Options,
without interest and less any applicable withholding taxes (the “Option Payment”), and will no longer be
exercisable for any securities of the Company, Parent or any of their
respective subsidiaries, successors or assigns, all in accordance with the
terms of the Merger Agreement; and


 


(b)           in accordance with the Merger
Agreement and the DG Plans, the Management Stockholder shall have no right to
receive payments in respect of any Cancelled Options, the exercise price of
which are equal to or greater than $22.00 per share (i.e., the Management
Stockholder’s “out of the money” Options); and


 


(c)           subject to the payment of the Option Payment, all of the
Management Stockholder’s rights and claims in respect of the Cancelled Options
(including the Management Stockholder’s “out of the money” Options) shall
terminate in all respects; and


 


(d)           all of the Management Stockholder’s
rights and claims in respect of the Management Stockholder’s DG Options that
are (and solely to the extent) permitted pursuant to this Agreement to become
Rollover Options as of the Effective Time (as defined in the Merger Agreement)
shall be limited to (i) the terms of the agreements or instruments
evidencing the grant of such awards and the applicable DG Plan governing such
awards, as amended as provided by this Agreement, and (ii) the terms and
conditions of a Management Stockholder’s Agreement, to be entered into by and
between the Company and the undersigned Management Stockholder effective as of
the Effective Time, and a Sale Participation Agreement, to be entered into by
and between the Management Stockholder and Parent, effective as of the
Effective Time.


 


3.             The Management Stockholder hereby
represents and warrants to the Company that the Management Stockholder is the
sole record and beneficial owner of the DG Options and that the Management Stockholder
has not sold, transferred, conveyed, pledged or hypothecated any interest in
the DG Options, and the Management Stockholder agrees not to take any action
that would cause the foregoing representations and warranties not to be true as
of the Effective Time.


 


4.             The Management Stockholder agrees
to retain, as Rollover Options, DG Options as set forth on Schedule I.  However, no DG Option with a Total Rollover
Value that is a negative number will be retained as a Rollover Option.  For purposes of this Option Rollover
Agreement, “Total Rollover Value” shall mean, with respect to a DG
Option immediately prior to the Effective Time, the excess of (a) the
product of (i) $22.00 and (ii) the number of shares of common stock
of the Company subject to such option over (b) the aggregate exercise
price per share of such option.


 


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5.             The terms of the Rollover Options
shall be amended, effective immediately upon the Effective Time, to provide for
the following:  each Rollover Option
shall be hereby adjusted such that (i) the exercise price per share of the
common stock of the Company (“Common Stock”) underlying each Rollover
Option will be as set forth on Exhibit A and (ii) the number of
shares of Common Stock underlying each Rollover Option will be equal to the
number set forth on Exhibit A.  For
the avoidance of doubt, for each Rollover Option, the adjustment referenced in
this Section 5 will not result in any difference between (i) the
excess of the product of (x) the fair market value of one share of Common
Stock as it exists immediately after the Effective Time and (y) the number
of shares of Common Stock subject to the Rollover Option immediately after the
Effective Time, over the aggregate exercise price per share of such Rollover
Option immediately after the Effective Time as compared to (ii) the Total
Rollover Value of the Rollover Option immediately prior to the Effective
Time.  In addition, the ratio of the
exercise price to the fair market value of the shares of Common Stock subject
to each Rollover Option immediately after the Effective Time will not be
greater than the ratio of the exercise price to the fair market value of the
shares subject to the Rollover Option immediately prior to the Effective Time.


 


6.             This Option Rollover Agreement
shall be governed by and construed in accordance with the laws of the State of
Tennessee, regardless of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.


 


7.             This Option Rollover Agreement may
be executed in counterparts, all of which shall be considered one and the same
agreement, it being understood that all parties need not sign the same
counterpart.


 


[Signatures on
next page.]


 


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Schedule
I


 


OPTION
ROLLOVER ELECTION FORM


 


Name of Management
Stockholder:
                                                                 


 


Do you wish to “roll over” certain of your options
to purchase shares of Common Stock of the Company which you currently hold for
options to purchase shares of common stock in the Surviving Corporation
pursuant to the Option Rollover Agreement? 
Please note that
you may not rollover a portion of a given grant.  Only whole grants may be rolled over.


o Yes    o No


If yes, please select either
A or B below:


 


A.                                   o  I, Management Stockholder, agree to rollover ALL
of the DG Options (as defined in the Option Rollover Agreement), other than DG
Options the exercise price of which are equal to or greater than $22.00 per share
(i.e., “out of the money” Options”)


 


B.                                     o I, Management
Stockholder, agree to rollover each DG Option identified in the chart below
that I have designated by checking the box in the far right column:


 


	
  Date of

  OptionGrant

  	
   

  	
  Expiration Date

  	
   

  	
  Number of

  Shares of

  Common Stock 

  of DG subject to

  the Grant

  	
   

  	
  Exercise Price

  Per Share

  	
   

  	
  Aggregate

  Spread Value at 

  time of Closing

  	
   

  	
  Please check the

  box to the right of

  each DG Option

  that you wish to

  rollover

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  o

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
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Executed this     
day of       , 2007 by:


 


 


	
   

  	
   

  
	
  Management Stockholder:

  



 

















 


Accepted this     
day of         , 2007 by:


 


 


DOLLAR GENERAL
CORPORATION


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 

















 


Exhibit A


 


	
  Exercise Price of the 

  DG Options

  	
   

  	
  Number of Shares

  Underlying the DG

  Options

  	
   

  	
  Adjusted Exercise Price of

  Rollover Options

  	
   

  	
  Number of Shares

  Underlying

  the Rollover Options

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


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