-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, V5DkKHxvWXuPgcBXZWO3qU8mwLLpBuYWphcL1xVDnv+86UsNveTGII3ekJ7GB0RH CFQUjoJYim2NlhMeCUFA2g== 0001005794-04-000507.txt : 20040628 0001005794-04-000507.hdr.sgml : 20040628 20040628162644 ACCESSION NUMBER: 0001005794-04-000507 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031231 FILED AS OF DATE: 20040628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DOLLAR GENERAL CORP CENTRAL INDEX KEY: 0000029534 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-VARIETY STORES [5331] IRS NUMBER: 610502302 STATE OF INCORPORATION: TN FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11421 FILM NUMBER: 04885219 BUSINESS ADDRESS: STREET 1: 100 MISSION RIDGE CITY: GOODLETTSVILLE STATE: TN ZIP: 37072 BUSINESS PHONE: 6158554000 MAIL ADDRESS: STREET 1: 100 MISSION RIDGE CITY: GOODLETTSVILLE STATE: TN ZIP: 37072 FORMER COMPANY: FORMER CONFORMED NAME: TURNER CAL DATE OF NAME CHANGE: 19710401 FORMER COMPANY: FORMER CONFORMED NAME: TURNER J L & SON INC DATE OF NAME CHANGE: 19710401 11-K 1 dg11k062504.txt FORM 11-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2003 Commission File No.: 001-11421 A. Full title of the plan: Dollar General Corporation 401(k) Savings and Retirement Plan B. Name of issuer of securities held pursuant to the plan and the address of principal executive office: Dollar General Corporation 100 Mission Ridge Goodlettsville, Tennessee 37072 AUDITED FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE Dollar General Corporation 401(k) Savings and Retirement Plan As of December 31, 2003 and 2002 and for the year ended December 31, 2003 with Report of Independent Registered Public Accounting Firm Dollar General Corporation 401(k) Savings and Retirement Plan Audited Financial Statements and Supplemental Schedule As of December 31, 2003 and 2002 and for the year ended December 31, 2003 Contents Audited Financial Statements Report of Independent Registered Public Accounting Firm........................1 Statements of Net Assets Available for Benefits................................2 Statement of Changes in Net Assets Available for Benefits......................3 Notes to Financial Statements...............................................4-10 Supplemental Schedule Schedule of Assets (Held at End of Year)......................................11 Report of Independent Registered Public Accounting Firm To the Participants and Plan Administrator of Dollar General Corporation 401(k) Savings and Retirement Plan We have audited the accompanying statements of net assets available for benefits of Dollar General Corporation 401(k) Savings and Retirement Plan as of December 31, 2003 and 2002, and the related statement of changes in net assets available for benefits for the year ended December 31, 2003. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2003 and 2002, and the changes in its net assets available for benefits for the year ended December 31, 2003, in conformity with U.S. generally accepted accounting principles. Our audits were performed for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedule of assets (held at end of year) as of December 31, 2003, is presented for the purpose of additional analysis and is not a required part of the financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. Nashville, Tennessee June 4, 2004 /s/ Ernst & Young LLP 1 Dollar General Corporation 401(k) Savings and Retirement Plan Statements of Net Assets Available for Benefits December 31, 2003 2002 --------------------------------- Assets Investments, at fair value: Dollar General Corporation common stock $35,793,491 $22,456,612 Registered investment companies 51,327,673 36,344,226 Participant notes receivable 2,966,526 2,173,613 Real estate limited partnerships 167,185 275,348 --------------------------------- Total investments 90,254,875 61,249,799 --------------------------------- Receivables: Employer contributions - 5,469,478 Participants' contributions 268,044 421,060 --------------------------------- Total receivables 268,044 5,890,538 Cash - 56,029 --------------------------------- Net assets available for benefits $90,522,919 $67,196,366 =================================
See accompanying notes to the financial statements. 2 Dollar General Corporation 401(k) Savings and Retirement Plan Statement of Changes in Net Assets Available for Benefits Year ended December 31, 2003 Additions: Additions to net assets attributed to: Investment income: Interest and Dividends $ 683,001 Net appreciation in fair value of investments 25,230,716 ---------------- 25,913,717 Contributions: Employer 2,484,086 Participant 6,152,712 Rollover 1,760,028 ---------------- 10,396,826 ---------------- Total additions 36,310,543 Deductions: Deductions from net assets attributed to: Benefits paid to participants 12,745,556 Administrative expenses 238,434 ---------------- Total deductions 12,983,990 ---------------- Net increase 23,326,553 Net assets available for benefits: Beginning of year 67,196,366 ---------------- End of year $90,522,919 ================
See accompanying notes to the financial statements. 3 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements December 31, 2003 1. Description of Plan The following brief description of the Dollar General Corporation 401(k) Savings and Retirement Plan (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. General The Plan is a defined contribution plan for all employees of Dollar General Corporation (the "Employer" or the "Company"). The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Contributions The Plan allows the participants to make contributions of the participants' earnings in the form of deferred compensation to a retirement plan before income taxes are deducted. The contributions are invested, and income earned is not taxed to the participant until withdrawn from the Plan. Participants may elect to contribute from 1% to 25% of pre-tax annual eligible compensation as defined in the Plan, subject to certain limitations under applicable federal law. Participants may also make rollover contributions to the Plan. The Employer has the option of matching up to 100% of the first 5% of eligible compensation contributed by the participants ("Employer Matching Contribution"). The participant contribution and Employer Matching Contribution are invested as directed by the participant. In addition to the Employer Matching Contribution described above, the Employer may contribute discretionary amounts from time to time ("Profit Sharing Contribution") as Profit Sharing Contributions. The Profit Sharing Contribution is invested as directed by the participant. Participants must be employed on the last day of the Plan year to receive a Profit Sharing Contribution. There was no Profit Sharing Contribution for the 2003 Plan year. Prior to January 1, 2003, the Employer also had the option to make contributions to the Plan on behalf of all participants which shall be treated as Qualified Nonelective Employer Contributions ("QNEC"). Effective January 1, 2003, the Company elected to discontinue QNEC contributions to the Plan. 4 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 1. Description of Plan (continued) Participant Accounts Each participant's account is credited with the participant's contributions and withdrawals, as applicable, and allocations of the Employer contributions and Plan earnings, and is charged with an allocation of administrative expenses. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. Vesting Participants who have one hour of service on or after January 1, 2003 are immediately vested in their contributions and the Employer Matching and Profit Sharing Contributions plus actual earnings thereon. Participants who do not have one hour of service on or after January 1, 2003 are subject to the prior vesting schedule under the Plan. Participants are 100% vested without regard to credited service in the event of death, disability, or attainment of retirement age. Participant Loans Participants in the Plan may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Only one loan may be outstanding at a time. Loans are secured by the balance in the participant's account and bear interest at a rate commensurate with local prevailing rates as determined by the Plan Administrator. Loans must be repaid within 5 years from the date of the loan unless proceeds are used to acquire the principal residence of the participant borrower. Principal and interest are paid ratably through weekly or semi-monthly payroll deductions. Payment of Benefits On termination of service, a participant may elect to receive a lump-sum amount equal to the value of the participant's vested interest in his or her account or, under certain circumstances, may purchase an annuity. 5 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 1. Description of Plan (continued) Forfeited Accounts Forfeited balances of terminated participants' nonvested accounts are used to reduce future contributions of the Company or to pay reasonable Plan expenses. In 2003, employer contributions were reduced by $1,382,471 and Plan expenses of $186,483 were paid from forfeited nonvested accounts. The balance of forfeited nonvested accounts was $364,902 and $571,039 at December 31, 2003 and 2002, respectively. Administrative Expenses Participants pay for the costs charged for originating loans. Fees and expenses associated with the administrative and recordkeeping services provided by an external provider are paid by the Plan. The Employer pays all other expenses. Change in Trustees and Plan Recordkeepers On November 1, 2003, State Street Bank and Trust Company ("State Street") replaced Matrix Capital Bank as Trustee of the Plan and CitiStreet LLP replaced BISYS Retirement Services, L.P. as Plan recordkeeper. As of November 17, 2003, all assets and records were transferred to State Street and CitiStreet. Plan Termination Although it has not expressed any intent to do so, the Employer has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, all participant accounts will become fully vested and the assets will be distributed to participants or their beneficiaries. 6 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 2. Summary of Significant Accounting Policies Basis of Accounting The financial statements of the Plan are prepared under the accrual method of accounting. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates. Investment Valuation and Income Recognition The Plan's investments are stated at fair value, which generally equals the quoted market price on the last business day of the Plan year. The shares of registered investment companies are valued at quoted market prices that represent the net asset value of shares held by the Plan at year-end. The Dollar General Corporation common stock is valued at the last reported sales price on the last business day of the Plan year. Real Estate limited partnership investments are valued at the appraised values as of the last business day of the Plan year. The participant loans receivable are valued at their outstanding balances, which approximate fair value. Purchases and sales of securities are recorded on a trade date basis. Dividend income is recorded on the dividend payable date. Interest income is recorded on the accrual basis. Payment of Benefits Benefits are recorded when paid. 7 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 3. Income Tax Status The Plan has received a determination letter from the Internal Revenue Service dated March 5, 2002, stating that the Plan is qualified under Section 401(a) of the Code and therefore, the related trust is exempt from taxation. Subsequent to this issuance of the determination letter, the Plan was amended. Once qualified, the Plan is required to operate in conformity with the Code to maintain its qualification. The Company has indicated that it will take the necessary steps, if any, to maintain the Plan's qualified status. 4. Investments During 2003, the Plan's investments (including gains and losses on investments purchased and sold, as well as held during the year) appreciated (declined) in fair value as follows: Year ended December 31, 2003 ----------------------- Registered investment companies $ 8,310,072 Dollar General Corporation common stock 16,931,835 Real estate limited partnerships (11,191) ----------------------- $25,230,716 ======================= 8 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 4. Investments (continued) Investments which represent 5% or more of the Plan's net assets available for benefits are as follows: December 31, - ------------------------------------------------------------------------------------------------------------------- Identity of Party Involved Description of Assets 2003 2002 - ------------------------------------------------------------------------------------------------------------------- Dollar General Corporation Dollar General Corporation common stock $35,793,491 $22,456,612 The American Funds Group Washington Mutual Investors Fund 10,144,177 7,037,951 INVESCO Institutional Invesco Stable Value Trust 12,484,808 - PIMCO Funds PIMCO Total Return Fund 4,754,651 - Dodge & Cox Funds Dodge & Cox Balanced Fund 18,056,186 - The American Funds Group The Income Fund of America - 14,275,848 The American Funds Group The Cash Management Trust of America - 4,351,489
5. Transactions with Parties-in-Interest Transactions with parties-in-interest include purchases and sales of assets through Matrix Capital Bank from January 1 through October 31, 2003 and through State Street Bank and Trust from November 1 through December 31, 2003. For the periods indicated, Matrix Capital Bank and State Street Bank and Trust also served as the depositor for the Plan's assets. Additional parties-in-interest transactions include contributions by the Employer and the Plan's investment in Company stock including reinvestment of dividends paid from the Company stock. 6. Commitments and Contingencies As previously disclosed in the Plan's Form 11-K for the year ended December 31, 2001 filed with the Securities and Exchange Commission on July 3, 2002 (the "2001 Form 11-K"), the Company restated its audited financial statements for fiscal years 1999 and 1998, and certain unaudited financial information for fiscal year 2000 (the "Restatement") by 9 Dollar General Corporation 401(k) Savings and Retirement Plan Notes to Financial Statements (continued) 6. Commitments and Contingencies (continued) means of its Form 10-K for the fiscal year ended February 2, 2001, which was filed on January 14, 2002. Also as described more fully in the 2001 Form 11-K, the Company settled the consolidated Restatement-related class action lawsuit filed in the United States District Court for the Middle District of Tennessee on behalf of a class of persons who purchased or otherwise made an investment decision regarding the Company's securities and related derivative securities between March 5, 1997 and January 14, 2002. The $162 million settlement was approved by the court on May 24, 2002 and was paid by the Company in the first half of its fiscal year ended January 31, 2003. As a member of the plaintiff class, the Plan expects that this agreement will result in a net payment to the Plan after attorneys' fees of approximately $1.4 million, which has not been reflected in the Plan's financial statements. 7. Risks and Uncertainties The Plan invests in various investment securities including Dollar General Corporation common stock, which comprises 40% and 37% of total investments at December 31, 2003 and 2002, respectively. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants' account balances and the amounts reported in the statements of net assets available for benefits. 10 Supplemental Schedule Dollar General Corporation 401(k) Savings and Retirement Plan EIN: 61-0502302 Plan: 002 Schedule of Assets (Held at End of Year) Schedule H, Line 4i Year Ended December 31, 2003 (c) Description of Investment including Maturity Date, Rate of (b) Identity of Issue, Borrower, Interest, Collateral, Par (a) Lessor, or Similar Party or Maturity Value (e) Current Value - ----------------------------------------------------------------------------------------------------------------------- * Dollar General Corporation Dollar General Corporation common stock $35,793,491 * State Street Bank & Trust State Street Short Term Investment Fund 1,580,075 Dodge & Cox Dodge & Cox Balanced Fund 18,056,186 The American Funds Group Washington Mutual Investors Fund 10,144,177 Invesco Invesco Stable Value Trust 12,484,808 PIMCO PIMCO Total Return Fund 4,754,651 Ariel Ariel Appreciation Fund 303,270 T. Rowe Price T. Rowe Price Small-Cap Stock Fund 318,490 Artisan Artisan International Fund 118,956 The American Funds Group The Growth Fund of America 3,567,060 * Participant notes receivable Interest rate ranging from 4% to 9.5% 2,966,526 Real estate limited partnerships: Interchange City Associates, Ltd. 15.5 units 157,325 Realty FD 85-1 200 units 9,860 ------------------------------ $90,254,875 ==============================
* Party-in-interest Column (d) has not been presented as this information is not applicable. 11 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the Administrator of the Dollar General Corporation 401(k) Savings and Retirement Plan has duly caused this Annual Report to be signed on its behalf by the undersigned hereunto duly authorized. Date: June 28, 2004 DOLLAR GENERAL CORPORATION ------------- By: /s/ Jeffrey R. Rice ----------------------------------------------- Name: Jeffrey R. Rice Title: Vice President, Human Resources EXHIBIT INDEX Exhibit No. Description - -------------------------------------------------------------------------------- 23 Consent of Independent Registered Public Accounting Firm EX-23 2 dgexhibit23062504.txt EXHIBIT 23 Exhibit 23 Consent of Independent Registered Public Accounting Firm We consent to the incorporation by reference in the Registration Statements (Form S-8 No. 333-102653 and Form S-8 No. 333-65789) pertaining to the Dollar General Corporation 401(k) Savings and Retirement Plan of our report dated June 4, 2004, with respect to the financial statements and schedule of the Dollar General Corporation 401(k) Savings and Retirement Plan included in this Annual Report (Form 11-K) for the year ended December 31, 2003. /s/ Ernst & Young LLP Nashville, Tennessee June 22, 2004 -----END PRIVACY-ENHANCED MESSAGE-----