Document:

Exhibit 10.1

 

VOTING AGREEMENT

 

VOTING AGREEMENT (this “Agreement”), dated as of June 3, 2012, among Forestar Group Inc. (“Forestar”), a Delaware corporation (“Parent”), and the stockholders of CREDO Petroleum Corporation (the “Company”) signatory hereto (each a “Stockholder”).

 

WHEREAS, in order to induce Parent and Longhorn Acquisition Inc., a Delaware corporation, to enter into the Agreement and Plan of Merger, dated as of the date hereof (as amended from time to time, the “Merger Agreement”), with the Company, Parent has requested each Stockholder, and each Stockholder has agreed, to enter into this Agreement with respect to all shares of Company Common Stock beneficially owned by such Stockholder, whether beneficial ownership is acquired before, on or after the date of this Agreement (“Shares”).

 

NOW, THEREFORE, the parties hereto agree as follows:

 

ARTICLE 1

 

VOTING AGREEMENT; GRANT OF PROXY

 

Section 1.01                                Voting Agreement.  Each Stockholder shall, at any meeting of the stockholders of the Company, vote all Shares held at such time by such Stockholder: (i) for the Merger Agreement, the Merger and the other transactions contemplated thereby at any meeting of the stockholders of the Company, and at any adjournment thereof, at which such Merger Agreement and other related agreements (or any amended version thereof), or such other actions, are submitted for the consideration and vote of the stockholders of the Company, (ii) against (A) any Acquisition Proposal and (B) any other corporate action the consummation of which would prevent or materially delay the consummation of the transactions contemplated by the Merger Agreement and (iii) as directed by Parent with respect to any proposal to adjourn any meeting of the stockholders of the Company at which any of the foregoing matters are considered; provided that, nothing contained in this Section 1.01 shall restrict any Stockholder or any affiliate (as defined in Rule 12b-2 under the Exchange Act) of any Stockholder, if applicable, from taking any action in such Stockholder’s or such affiliate’s capacity as a director, officer or employee of the Company or any other Person which is permitted to be taken pursuant to the Merger Agreement.  The obligations of each Stockholder specified in this Section 1.01 shall apply whether or not (x) the Board of Directors of the Company (or any committee thereof) makes an Adverse Recommendation Change, or (y) the Company breaches any of its representations, warranties, agreements or covenants set forth in the Merger Agreement.  Each Stockholder shall retain the right to vote the Shares in such Stockholder’s sole discretion on all matters other than those set forth above in this Section 1.01, which are at any time and from time to time presented for a vote to the Company’s stockholders generally.

 

Section 1.02                                Irrevocable Proxy.  Each Stockholder hereby revokes any and all previous proxies granted with respect to such Stockholder’s Shares.  By entering into this Agreement, each Stockholder hereby grants a proxy appointing Parent as such Stockholder’s attorney-in-fact and proxy, with full power of substitution, for and in such Stockholder’s name, to vote such Stockholder’s Shares in the manner contemplated by Section 1.01 if and only if such Stockholder

 

 

(i) fails to vote or (ii) attempts to vote such Shares in a manner inconsistent with Section 1.01.  Except as set forth below, the proxy granted by each Stockholder pursuant to this Section 1.02 is irrevocable and is granted in consideration of Parent entering into this Agreement and the Merger Agreement and incurring certain related fees and expenses.  Each Stockholder hereby affirms that the proxy granted in this Section 1.02 is coupled with an interest and may under no circumstances be revoked.  The proxy contained herein with respect to the Shares is intended to be irrevocable in accordance with the provisions of Section 212(e) of the Delaware General Corporation Law.  Notwithstanding the foregoing, the proxy granted by each Stockholder pursuant to this Section 1.02 shall be revoked and terminated upon termination of this Agreement in accordance with its terms.

 

ARTICLE 2

 

REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS

 

Each Stockholder represents and warrants, on behalf of such Stockholder only and not on behalf of any other Stockholder, to Parent that:

 

Section 2.01                                Authorization.  Stockholder has the requisite entity power and authority (and, in the case of an individual, the capacity) to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby.  This Agreement constitutes a valid and binding agreement of the Stockholder enforceable against the Stockholder, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, moratorium, reorganization or similar laws in effect that affect the enforcement of creditors rights generally or (b) general principles of equity, whether considered in a proceeding at law or in equity.  If Stockholder is married and the Shares set forth on Exhibit A, attached hereto, constitute community property under applicable Law, this Agreement has been duly authorized, executed and delivered by, and constitutes the valid and binding agreement of, Stockholder’s spouse.

 

Section 2.02                                Non-Contravention.  The execution, delivery and performance by Stockholder of this Agreement and the consummation of the transactions contemplated hereby do not and will not (i) violate any applicable Law or (ii) require any consent or other action by any Person under, constitute a default under, or give rise to any right of termination, cancellation or acceleration or to a loss of any benefit to which Stockholder is entitled under any provision of any agreement or other instrument binding on Stockholder.

 

Section 2.03                                Ownership of Shares and Other Securities.

 

(a)                                  Schedule A to this Agreement sets forth the number and type of Shares and the number and type of Shares that are issuable upon exercise of outstanding warrants, options or other derivative securities, whether or not exercisable (the “Derivative Securities”), of which such Stockholder is the record and beneficial owner.  Such Stockholder owns such Shares and Derivative Securities, free and clear of any Lien and any other limitation or restriction (including any restriction on the right to vote or dispose of such Shares) except as established hereby.  None of such Stockholder’s Shares are subject to any voting trust or other agreement or arrangement with respect to the voting of such Shares except as established hereby.

 

2

 

(b)                                 As of the date hereof, except for the Shares, Company Options and Derivative Securities set forth on Exhibit A, Stockholder does not beneficially own any (i) shares of capital stock or voting securities of the Company, (ii) securities of the Company convertible into or exchangeable for shares of capital stock or voting securities of the Company or (iii) options or other rights to acquire from the Company any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of the Company.

 

ARTICLE 3

 

REPRESENTATIONS AND WARRANTIES OF PARENT

 

Parent represents and warrants to each Stockholder that:

 

Section 3.01                                Authorization.  Parent has the requisite corporate power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby.  The execution, delivery and performance by Parent of this Agreement and the consummation by Parent of the transactions contemplated hereby have been duly authorized by the Board of Directors of Parent.  This Agreement constitutes a valid and binding Agreement of Parent enforceable against Parent, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, moratorium, reorganization or similar laws in effect that affect the enforcement of creditors rights generally or (b) general principles of equity, whether considered in a proceeding at law or in equity.

 

Section 3.02                                Non-Contravention.  The execution, delivery and performance by Parent of this Agreement and the consummation of the transactions contemplated hereby do not and will not (i) violate any applicable Law or (ii) require any consent or other action by any Person under, constitute a default under, or give rise to any right of termination, cancellation or acceleration or to a loss of any benefit to which Parent is entitled under any provision of any agreement or other instrument binding on Parent.

 

ARTICLE 4

 

COVENANTS OF STOCKHOLDER

 

Stockholder hereby covenants and agrees, on behalf of itself only and not on behalf of any other Stockholder, that:

 

Section 4.01                                No Proxies for, Encumbrances on or Transfers of Shares.  Stockholder shall not, without the prior written consent of Parent, directly or indirectly, (i) grant any proxies or enter into any voting trust or other agreement or arrangement with respect to the voting of any Shares or (ii) sell, assign, transfer, pledge, encumber or otherwise dispose of, or enter into any contract, option or other arrangement or understanding with respect to the direct or indirect sale, assignment, transfer, encumbrance or other disposition of, any Shares during the term of this Agreement; provided, however, that Stockholder may, if Stockholder is an individual, (x) transfer Shares to any member of Stockholder’s immediate family for estate planning purposes, and (y) transfer Shares upon the death of Stockholder (each, a “Permitted Transfer”); provided, further, that any such transfer shall be a Permitted Transfer only if, as a precondition to such

 

3

 

transfer, the transferee enters into an agreement substantially similar to this Agreement with Parent.

 

Section 4.02                                Appraisal Rights.  Stockholder agrees not to exercise any rights (including under Section 262 of the General Corporation Law of the State of Delaware) to demand appraisal of any Shares which may arise with respect to the Merger.

 

Section 4.03                                Standstill Provision.  Each Stockholder agrees that, during the term of this Agreement, such Stockholder shall not acquire, offer or propose to acquire or agree to acquire, whether by purchase, tender or exchange offer, through the acquisition of control of another Person, by joining a partnership, limited partnership, syndicate or other “group” (within the meaning of Section 13(d)(3) of the Exchange Act) or otherwise, beneficial ownership (as defined in Rule 13d-3 promulgated under the Exchange Act) of any securities of the Company or rights to acquire (whether currently, upon lapse of time, following the satisfaction of any conditions, upon the occurrence of any event or any combination of the foregoing) any securities of the Company; except however, for any acquisition of Shares by such Stockholder (i) as the result of exercise of employee stock options, or (ii) as the result of any pro rata stock dividend, stock split or other similar actions of the Company.

 

Section 4.04                                Non-Solicitation.  Except as permitted pursuant to the Merger Agreement, each Stockholder agrees that, during the term of this Agreement, such Stockholder shall not, directly or indirectly, knowingly solicit, initiate or encourage any inquiry or proposal that constitutes or could reasonably be expected to lead to an Acquisition Proposal, knowingly provide any non-public information or data to any Person relating to an Acquisition Proposal, engage in any discussions or negotiations concerning an Acquisition Proposal, or otherwise knowingly facilitate any effort or attempt to make or implement an Acquisition Proposal or agree to, recommend or accept an Acquisition Proposal.

 

Section 4.05                                Special Meetings of Stockholders.  Each Stockholder agrees that, during the term of this Agreement, such Stockholder shall not, alone, as part of a “group” (within the meaning of Section 13(d)(3) of the Exchange Act), or otherwise, exercise any right to call a special meeting of stockholders of the Company.

 

ARTICLE 5

 

MISCELLANEOUS

 

Section 5.01                                Definitional and Interpretative Provisions.

 

(a)                                  Capitalized terms used but not defined herein shall have the respective meanings set forth in the Merger Agreement.

 

(b)                                 The words “hereof”, “herein” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof.  Any singular term in this Agreement shall be deemed to include the plural, and any plural term the singular.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to

 

4

 

be followed by the words “without limitation”, whether or not they are in fact followed by those words or words of like import.  “Writing”, “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form.  References to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof.  References to any Person include the successors and permitted assigns of that Person.  References from or through any date mean, unless otherwise specified, from and including or through and including, respectively.

 

Section 5.02                                Further Assurances.  Parent and Stockholder will each execute and deliver, or cause to be executed and delivered, all further documents and instruments and use reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Law, to consummate and make effective the transactions contemplated by this Agreement.

 

Section 5.03                                Amendments; Termination.  Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement, or in the case of a waiver, by the party against whom the waiver is to be effective.  This Agreement shall terminate upon the earlier of (x) the termination of the Merger Agreement, (y) an amendment to the Merger Agreement that reduces the aggregate consideration payable to the Company’s stockholders and (z) the Effective Time.

 

Section 5.04                                Expenses.  All costs and expenses incurred in connection with this Agreement shall be paid by the party incurring such cost or expense.

 

Section 5.05                                Successors and Assigns.  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided that no party may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without the consent of the other parties hereto, except that Parent may transfer or assign its rights and obligations to any affiliate (as defined in Rule 12b-2 under the Exchange Act) of Parent.

 

Section 5.06                                Governing Law.  This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware.

 

Section 5.07                                Counterparts; Effectiveness.  This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto.  Until and unless each party has received a counterpart hereof signed by the other party hereto, this Agreement shall have no effect and no party shall have any right or obligation hereunder (whether by virtue of any other oral or written agreement or other communication).

 

Section 5.08                                Severability.  If any term, provision or covenant of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the

 

5

 

remainder of the terms, provisions and covenants of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

 

Section 5.09                                Specific Performance.  The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement is not performed in accordance with the terms hereof and that each of the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in addition to any other remedy to which they are entitled at law or in equity.  The parties further agree that no party to this Agreement shall be required to obtain, furnish or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this Section 5.10 and each party waives any objection to the imposition of such relief or any right it may have to require the obtaining, furnishing or posting of any such bond or similar instrument.

 

[Remainder of this page intentionally left blank]

 

6

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written.

 

 

	
 
    	
FORESTAR GROUP INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ James M. DeCosmo
    
	
 
    	
 
    	
Name: James M. DeCosmo
    
	
 
    	
 
    	
Title: President and Chief Executive Officer
    

 

[Signature Page to Voting Agreement]

 

 

	
 
    	
/s/ James T. Huffman
    
	
 
    	
Name: JAMES T. HUFFMAN
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
RCH ENERGY OPPORTUNITY FUND III, LP
    
	
 
    	
By: RCH Energy Opportunity Fund III GP, LP
    
	
 
    	
Its General Partner
    
	
 
    	
By: RR Advisors, LLC
    
	
 
    	
Its General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert Raymond
    
	
 
    	
Robert Raymond, Sole-Member
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
RCH ENERGY SSI FUND, LP
    
	
 
    	
By: RCH Energy SSI GP, LP
    
	
 
    	
Its General Partner
    
	
 
    	
By: RR Advisors, LLC
    
	
 
    	
Its General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert Raymond
    
	
 
    	
Robert Raymond, Sole-Member
    

 

[Signature Page to Voting Agreement]

 

 

EXHIBIT A

 

Equity Ownership

 

	
 
    	
 
    	
James T. Huffman
    	
 
    	
RCH Energy Opportunity 
   Fund III, LP
    	
 
    	
RCH Energy SSI 
   Fund, LP
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Shares of Company Common Stock:
    	
 
    	
285,586 shares
    	
 
    	
687,000 shares
    	
 
    	
1,150,000
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Vested Company Options:
    	
 
    	
56,563 options
    	
 
    	
0
    	
 
    	
0
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Unvested Company Options:
    	
 
    	
0
    	
 
    	
0
    	
 
    	
0
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Derivative Securities
    	
 
    	
0
    	
 
    	
0
    	
 
    	
0Exhibit 10.1

 

 

2012 Teamshare Incentive Program

 

I.            Definitions

 

As used in this document:

 

“AIP” shall mean the Amended and Restated Dollar General Corporation Annual Incentive Plan, as amended from time to time.

 

“Applicable Base Pay” shall mean the eligible employee’s annual salary (or day of pay if hourly) plus shift differential, subject to adjustment based on all other eligibility requirements and administrative rules.

 

“Committee” shall mean the Compensation Committee of the Board or any subcommittee thereof which meets the requirements of Section 162(m).

 

“Covered Employees” shall mean those officers who could, in respect of the Company’s 2012 fiscal year, be “covered employees” under Section 162(m).

 

“Dollar General” or “the Company” means Dollar General Corporation.

 

“Eligible Employee” shall have the meaning set forth in Section V below.

 

“Management” refers to an individual Teamshare participant’s direct supervisor and/or the Company’s executive officers up to and including the Chief Executive Officer.

 

“Merit Effective Date” shall mean April 1 of the applicable performance period or, if later, the applicable date of the annual merit increase (e.g., for the 2012 Teamshare program, the Merit Effective Date for salaried employees is April 1, 2012).

 

“Section 162(m)” refers to Section 162(m)(4)(C) of the Internal Revenue Code of 1986, as amended, and the regulations and guidance issued thereunder from time to time.

 

“Teamshare” shall mean this 2012 Teamshare Incentive Program.

 

II.          Teamshare Overview

 

The Committee has established the terms of Teamshare, which provides each Eligible Employee with an opportunity to receive a cash bonus payment equal to a certain percentage of his or her Applicable Base Pay based upon Dollar General’s achievement of one or more pre-established financial performance measures for a specified performance period (typically, our fiscal year).  When more than one financial performance measure is selected, the Committee determines the applicable weight to be assigned to each of the selected measures.

 

1

 

Threshold and target performance levels are established for each of the selected performance measures. No Teamshare payout may be made unless the threshold performance level is achieved. The amount payable to each Eligible Employee if the Company reaches the target performance level(s) is equal to a specified percentage of the Eligible Employee’s Applicable Base Pay, subject to adjustment for performance discussed under Section IV  below (except in the case of officers).  Teamshare payments for financial performance below or above the applicable target levels are prorated on a graduated scale commensurate with performance.

 

III.         2012 Teamshare Program

 

For the 2012 Teamshare program, the Committee selected financial performance measures based upon earnings before interest, taxes, depreciation and amortization, as adjusted for certain items (“Adjusted EBITDA”) and return on invested capital (“Adjusted ROIC”).  The Adjusted EBITDA measure and the Adjusted ROIC measure are weighted 90% and 10%, respectively, of the total Teamshare pool.  If, for example, the Company achieves the target Adjusted EBITDA performance level but does not achieve the threshold Adjusted ROIC performance level, the Teamshare pool will fund at 90%. In determining the level of performance the Company has achieved for each performance measure at year end, certain categories of items previously identified by the Committee may be excluded from the calculation.  Threshold performance results for both Adjusted EBITDA and Adjusted ROIC coincide with potential Teamshare payout levels equal to 50% of individual payout targets (as a percentage of the Eligible Employee’s Applicable Base Pay).

 

For purposes of the 2012 Teamshare program, Adjusted EBITDA is computed in accordance with the Company’s credit agreements, and Adjusted ROIC is calculated as total return (calculated as the sum of operating income, depreciation and amortization and minimum rentals, less taxes) divided by the result of (x) the sum of the averages of total assets and accumulated depreciation and amortization, less (y) cash, goodwill, accounts payable, other payables, accrued liabilities, plus 8x minimum rentals), all of the foregoing as determined under the Company’s financial statements.  Each of Adjusted EBITDA and Adjusted ROIC calculations shall exclude:

 

(1)  the impact of (a) certain costs, fees and expenses related to our acquisition and related financing by Kohlberg Kravis Roberts & Co., any refinancings, any related litigation or settlements of such litigation, and the filing and maintenance of a market maker registration statement; (b) any costs, fees and expenses directly related to any transaction that results in a Change in Control (within the meaning of the Company’s Amended and Restated 2007 Stock Incentive Plan) or related to any primary or secondary offering of the Company’s common stock or other security; (c) share-based compensation charges (for Adjusted EBITDA only); (d) any gain or loss recognized as a result of derivative instrument transactions or other hedging activities; (e) any gains or losses associated with the early retirement of debt obligations; (f) charges resulting from significant natural disasters; and (g) any significant gains or losses associated with our LIFO computation; and

 

2

 

(2)  unless the Committee disallows any such item, (a) non-cash asset impairments; (b) any significant loss as a result of an individual litigation, judgment or lawsuit settlement (including a collective or class action lawsuit and security holder lawsuit, among others); (c) charges for business restructurings; (d) losses due to new or modified tax or other legislation or accounting changes enacted after the beginning of the 2012 fiscal year; (e) significant tax settlements; and (f) any significant unplanned items of a non-recurring or extraordinary nature.

 

IV.   Determination of Bonuses

 

(a)   If the Company achieves at least the threshold financial performance levels, each Eligible Employee who participates in Teamshare will become eligible to receive a Teamshare payout if he or she receives at least a satisfactory individual performance review.

 

(b)   In the case of officers (including Covered Employees), the Committee, and in the case of all other employees, Management, will determine whether a participant in Teamshare has received at least a satisfactory individual performance review.

 

(c)   Bonuses for executive officers of the Company and hourly employees are paid 100% based on Company financial performance.  Bonuses for all other employees are calculated 100% on Company financial performance, with 20% subject to reduction based on individual performance; provided, however, that Management may adjust upward or downward, or entirely eliminate, the Teamshare payout otherwise due to any Eligible Employee (excluding officers which are addressed in (d) below) based upon personal performance of any such Eligible Employee, provided the total funded amount of the Teamshare pool is not exceeded.

 

(d)   In the case of officers (excluding executive officers and Covered Employees), the Committee may adjust upward or downward, or entirely eliminate, the Teamshare payout otherwise due to any eligible officer, provided the total funded amount of the Teamshare pool is not exceeded.

 

(e)   Bonus payouts to Covered Employees may be subject to reduction or elimination, but not upward adjustment, pursuant to the terms of the AIP.

 

(f)    Bonuses that are not allocated out of the Teamshare pool are subject to distribution at the discretion of the Chief Executive Officer of the Company, except that no such unallocated bonus amounts may be allocated to any Covered Employee.

 

V.          Individual Eligibility

 

(a)   To be eligible for a Teamshare payout, an employee must be an “Eligible Employee”, which for purposes of Teamshare means an employee must:

 

3

 

1.     Be an active regular, full-time or part-time store support center (SSC) or distribution center (DC) employee during the performance period (for Teamshare program, the Company’s 2012 fiscal year).

 

2.     Be hired by January 15 of the performance period.

 

3.     Be employed with the Company through the end of the performance period and on the date on which the Teamshare payment is made (unless otherwise required by  law).

 

4.     Have received a year-end performance rating of “Needs Improvement” or better (for officers, any Teamshare payment is in the Committee’s discretion if the officer receives a “Needs Improvement” performance rating). Employees rated “Unsatisfactory” are ineligible for a bonus under Teamshare.

 

(b)   Bonuses for the estates of Eligible Employees will be eligible to receive the Teamshare payment if the employee’s death occurs on or after the end of the performance period.

 

VI.         Administrative Rules

 

(a)   Except as provided in (c) below, bonuses for Eligible Employees classified as exempt  or salaried non-exempt are calculated based on the Company financial performance and subject to adjustment by Management based on individual performance. At year-end, Management will use the following guidelines in determining an adjustment:

 

 

	
Performance Rating
    	
 
    	
Total Bonus Opportunity
    	
 
    
	
O
    	
 
    	
105% - 115%
    	
 
    
	
VG
    	
 
    	
100% - 110%
    	
 
    
	
G
    	
 
    	
90% - 100%
    	
 
    
	
NI
    	
 
    	
40% - 80%
    	
 
    
	
U
    	
 
    	
0%
    	
 
    

 

(b)   At year-end, the guidelines above will also be provided to Management for adjusting any Teamshare payouts for eligible hourly employees rated “Needs Improvement”.

 

(c)   Any adjustments to Teamshare payouts for officers are determined by the Committee within the parameters of Section IV. Notwithstanding anything in this Teamshare plan document to the contrary, the determination of the Adjusted EBITDA and Adjusted ROIC performance measures and all other relevant actions applicable to the determination of bonus payout amounts to Covered Employees under Teamshare shall be pursuant to the terms of the AIP.

 

(d)   Each Eligible Employee’s Teamshare payout is computed as a percentage of the Applicable Base Pay plus any shift differential.

 

4

 

(e)   Teamshare payouts will be prorated for changes to an Eligible Employee’s position, pay, individual target, shift differential or, status that occur during the performance period based on the number of days the applicable element applies. The Applicable Base Pay used for Teamshare from the beginning of the performance period to the Merit Effective Date will be based on the eligible employee’s pay as of the Merit Effective Date.

 

(f)    Teamshare payouts are prorated to exclude leaves of absence during the performance period (unless otherwise required by law).

 

(g)   Teamshare payouts will be made no later than April 15 of the year following the fiscal year in which financial performance is measured (e.g., for the 2012 Teamshare program, payouts, if any, will be made no later than April 15, 2013).

 

(h)   Teamshare information is proprietary and confidential. Employees are reminded that they may not disclose Teamshare information relating to the Company’s financial goals or performance. Such disclosure may result in disciplinary action, up to and including termination. The Company reserves the right to adjust, amend or suspend Teamshare at any time for any reason, including, but not limited to, unforeseen events.

 

(i)    Solely for purposes of Covered Employees, the provisions and payouts under this 2012 Teamshare program shall be pursuant to and subject to the terms of the AIP, and in the event of any conflict between the provisions of this Teamshare program and the AIP, the terms of the AIP shall govern.

 

VII.       Tax and Other Withholding Information

 

The IRS considers incentive payments as supplemental wages.  In accordance with IRS guidelines, Dollar General will withhold federal income taxes at the supplemental rate (currently established at 25%).  In addition, this payment will be subject to applicable social security, Medicare, state and local taxes. Voluntary deductions (e.g. health insurance, 401k, etc.) will not be deducted from this amount.  Where required by law, specific garnishments (e.g., child support) may be deducted, as appropriate, from this amount.  Certain state laws require incentive payments be held for up to 30 days after the check date pending review of applicable child support garnishments.  After the Company receives notification from the state child support agencies regarding whether part or all of the impacted employee’s incentive payment should be paid toward child support, the Company will pay any remaining incentive funds with the next regular payroll.

 

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00204-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00204-of-00352.parquet"}]]