ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN
OFFICERS.
On July 6, 2022, Todd Vasos informed Dollar General Corporation (the "Company")
of his decision to step down from his position as Chief Executive Officer of the
Company effective November 1, 2022. To assist in the transition of leadership,
Mr. Vasos is expected to serve in a senior advisory position with the Company
beginning November 1, 2022, and continuing through April 1, 2023, at which time
he will retire from employment with the Company. The Company anticipates that it
will enter into a 2-year consulting agreement with Mr. Vasos following his
retirement from the Company. Mr. Vasos is expected to continue to serve as a
member of the Company's Board of Directors (the "Board"), including following
his retirement from the Company.
On July 8, 2022, the Board approved the promotion of Jeffery Owen, 52, to Chief
Executive Officer of the Company effective immediately following Mr. Vasos'
resignation from the Chief Executive Officer role. Mr. Owen has served as the
Company's Chief Operating Officer since August 2019. He returned to Dollar
General in June 2015 as Executive Vice President of Store Operations, with over
21 years of previous employment experience with the Company, including Senior
Vice President, Store Operations (August 2011-July 2014); Vice President,
Division Manager (March 2007-July 2011); Retail Division Manager
(November 2006-March 2007); and various other operations roles of increasing
importance and responsibility. He began his employment at Dollar General in
1992. Mr. Owen has also served as a director of Kirkland's, Inc. since
March 2015. The Board anticipates that it will elect Mr. Owen to serve as a
member of the Board for a term beginning on the date on which he assumes the
position of Chief Executive Officer.
On July 8, 2022, in connection with the approval of Mr. Owen's promotion, the
Compensation Committee of the Board approved, in each case effective upon the
date on which Mr. Owen assumes the position of Chief Executive Officer:
• an increase in Mr. Owen's annual base salary from $925,000 to $1,125,000; and
• an increase in Mr. Owen's targeted annual incentive opportunity from 100% to
150% of his base salary (with the annual incentive target and any actual
incentive payout to be prorated to reflect the portion of the year in each
position), with respect to the current fiscal year and based on the achievement
of the adjusted EBIT performance target previously established by the
Compensation Committee in accordance with the terms of the Company's annual
incentive plan.
The Compensation Committee also determined that a one-time long-term incentive
having an approximate value of $6,000,000 will be awarded to Mr. Owen in
connection with his promotion to Chief Executive Officer. This long-term
incentive will be delivered in non-qualified stock options (the "Option") to
purchase shares of the Company's common stock at a per share exercise price
equal to the closing price of the Company's common stock on the grant date of
the Option, which date shall coincide with the start of Mr. Owen's term as Chief
Executive Officer. The Option will be scheduled to vest ratably in installments
of 33 1/3% on each of the third, fourth and fifth anniversaries of the grant
date, subject to holding requirements through the fifth anniversary of the grant
date.
In addition, in connection with such promotion, on July 11, 2022, the Company
entered into an employment agreement with Mr. Owen (the "Employment Agreement"),
effective November 1, 2022 (the "Effective Date"), which will supersede and
replace his existing employment agreement on the Effective Date pursuant to the
terms and conditions of the Employment Agreement. The term of the Employment
Agreement will extend from the Effective Date until May 31, 2026, unless earlier
terminated in
1
accordance with the provisions of the Employment Agreement. The Employment
Agreement is subject to automatic one-year renewal periods; provides for the
terms and conditions of his employment as Chief Executive Officer of the
Company; commits to annually nominating Mr. Owen to serve on the Board during
his term as Chief Executive Officer of the Company; sets forth the material
terms of his compensation as Chief Executive Officer of the Company; and
contains certain business protections provisions, including non-competition and
non-solicitation provisions for two years following his service termination
date. The Employment Agreement is attached to this Form 8-K as Exhibit 99.2 and
is incorporated by reference as if fully set forth herein.
Pursuant to the Employment Agreement, if Mr. Owen is terminated by the Company
without cause (as defined in the Employment Agreement) or if he resigns from the
Company for good reason (as defined in the Employment Agreement), he will
receive (1) severance benefits of continued base salary payments over 24 months
plus a lump sum payment equal to two times his annual target bonus under the
Company's annual bonus program for senior executive officers in respect of the
Company's fiscal year in which the termination date occurs; (2) a lump sum
payment, payable at such time as annual bonuses are paid to other senior
executives of the Company, of a pro rata portion of the annual bonus, if any,
that he would have been entitled to receive for the fiscal year of termination,
if such termination had not occurred; (3) a lump sum payment equal to two times
the annual contribution that would have been made by the Company for the plan
year in which the employment termination occurs for his participation in the
Company's medical, pharmacy, dental and vision benefits programs; and
(4) reasonable outplacement services, as determined and provided by the Company,
for one year or until other employment is secured, whichever comes first.
The foregoing description of the Employment Agreement is a summary only, does
not purport to be complete, and is qualified in its entirety by reference to
Exhibit 99.2.
There are no arrangements or understandings between Mr. Owen and any other
persons pursuant to which Mr. Owen was selected to become Chief Executive
Officer, nor are there any family relationships between Mr. Owen and any of the
Company's directors or other executive officers. Neither Mr. Owen nor any
related person of Mr. Owen has a direct or indirect material interest in any
existing or currently proposed transaction to which the Company is or may become
a party that would require disclosure under Item 404(a) of Regulation S-K
promulgated under the Securities Exchange Act of 1934, as amended.
ITEM 7.01. REGULATION FD DISCLOSURE.
On July 12, 2022, the Company issued a press release regarding certain of the
matters discussed in Item 5.02. A copy of the press release is attached to this
Form 8-K as Exhibit 99.1 and is incorporated by reference as if fully set forth
herein.
The information contained within this Item 7.01, including the information in
Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, and shall not be deemed
incorporated by reference into any filing under the Securities Act of 1933, as
amended.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired. N/A
(b) Pro forma financial information. N/A
(c) Shell company transactions. N/A
(d) Exhibits. See Exhibit Index to this report.
2
© Edgar Online, source Glimpses