Free Declaration - District Court of Colorado - Colorado

Case 1:01-cv-01451-REB-KLM

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Exhibit D

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UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION In re DOLLAR GENERAL CORPORATION SECURITIES LITIGATION x : : : : x : : : x Civ. Action No. 3:01-0388 CLASS ACTION Judge Wiseman/Magistrate Brown

This Document Relates to: ALL ACTIONS.

NOTICE OF CLASS CERTIFICATION AND SETTLEMENT OF CLASS ACTION TO: ALL PERSONS OR ENTITIES WHO PURCHASED, EXCHANGED, OTHERWISE ACQUIRED OR MADE AN INVESTMENT DECISION REGARDING DOLLAR GENERAL CORPORATION SECURITIES (AS DEFINED BELOW) OR SOLD PUT OPTIONS ON DOLLAR GENERAL SECURITIES DURING THE PERIOD MARCH 5, 1997 THROUGH JANUARY 14, 2002, INCLUSIVE PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. THIS NOTICE RELATES TO BOTH THE CERTIFICATION OF A CLASS AND A PROPOSED SETTLEMENT OF THIS CLASS ACTION AND, IF YOU ARE A CLASS MEMBER, CONTAINS IMPORTANT INFORMATION AS TO YOUR RIGHTS CONCERNING THE SETTLEMENT AS FURTHER DESCRIBED BELOW. IF YOU ARE A MEMBER OF THE CLASS AND DO NOT OPT OUT, YOU WILL BE BOUND BY THE RELEASE WHETHER OR NOT YOU SUBMIT A CLAIM. IF YOU ARE A MEMBER OF THE CLASS AND DO NOT OPT OUT, YOU WILL BE BOUND BY THE SETTLEMENT AND ANY JUDGMENT IN THIS ACTION. THIS NOTICE HAS BEEN SENT TO YOU PURSUANT TO FEDERAL RULE OF CIVIL PROCEDURE 23, THE PRIVATE SECURITIES LITIGATION REFORM ACT AND AN ORDER OF THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE (THE "COURT"). The purpose of this notice is to inform you that the Court has determined that this lawsuit (the "Litigation") should proceed for settlement purposes as a class action on behalf of all persons and entities who from March 5, 1997 through January 14, 2002, inclusive (the "Class Period") (i) purchased, exchanged, otherwise acquired or made an investment decision (i.e., a decision by a Class Member not to sell Dollar General Securities held by the Class Member or a decision to allow options or other rights with respect to Dollar General Securities to expire) involving Dollar General Securities, or (ii) sold put options on Dollar General Securities who have suffered a loss (the "Class"). This Notice also serves to inform you that a settlement of the Litigation has been proposed between the plaintiff Class and Defendants Dollar General Corporation ("Dollar General" or the "Company"), Cal Turner, Jr., James L. Clayton, John B. Holland, Barbara L. Bowles, Dr. E. Gordon Gee, Dennis C. Bohorff, Barbara M. Knuckles, Reginald D. Dickson, David Wilds, William S. Wire, II, Bob Carpenter, Brian M. Burr, Phil Richards and Randy Sanderson (the "Settlement"). The Settlement is subject to approval by the Court. This Notice describes the rights you may have in relation to the Settlement and this Litigation. This Notice is not intended to be, and should not be construed as, an expression of any opinion by the Court with respect to the truth of the allegations in the Litigation or the merits of the claims or defenses asserted. This Notice is to advise you of the Litigation, the certification of the Class for settlement purposes, and the proposed Settlement, and of your rights in connection therewith. SUMMARY OF THE SETTLEMENT The proposed Settlement as memorialized in the First Amended Stipulation of Settlement ("Stipulation") creates a cash settlement fund in the amount of $162 million, plus interest that accrues on the fund prior to distribution (the "Cash Settlement Fund"). The Settlement also requires Dollar General to adopt an array of corporate governance measures designed to enhance the Company's internal controls and corporate governance. Your recovery from the Cash Settlement Fund will depend on a number of variables, including the number and type of Dollar General Securities you purchased, and the number of put options on Dollar General Securities you sold, during the period March 5, 1997 through January 14, 2002, inclusive (the "Class Period"), the timing of your purchases and any sales, the number of claims submitted by eligible claimants, and the amount of Court approved attorneys' fees, litigation costs and administrative expenses deducted from the fund. Depending on the number of eligible Dollar General Securities purchased and sold by Class Members who file completed proofs of claim in the Settlement and subject to variation due to a variety of factors including those d iscussed in the preceding sentence, the average distribution per Dollar General Security from the Settlement is estimated at approximately $1.07 before deductions of Court-approved fees and expenses. Lead Plaintiffs and Defendants do not agree on the average amount of damages per share that would have been recoverable if the Lead Plaintiffs were to have prevailed on each claim alleged. The issues on which the parties disagree include among other things: (1) whether the statements made or facts allegedly omitted were material, false, misleading or otherwise actionable under the securities laws or state law; (2) the appropriate economic model or other means for determining the amount by which Dollar General Securities were allegedly artificially inflated (if at all) during the Class Period; (3) the amount by which Dollar General Securities were allegedly artificially inflated (if at all) during the Class Period; (4) the effect of various market forces influencing the trading price of Dollar General Securities at various times during the Class Period; (5) the extent to which external factors, such as general market and industry conditions, influenced the trading price of Dollar General Securities at various times during the Class Period; (6) the extent to which specific, non-fraud factors influenced the trading price of Dollar General Securities at various times during the Class Period; (7) the extent to which the various matters that Lead Plaintiffs alleged were materially false or misleading influenced (if at all) the trading price of Dollar General Securities at various times during the Class Period; and (8) the extent to which the various allegedly adverse material facts that Lead Plaintiffs alleged were misrepresented or omitted influenced (if at all) the trading price of Dollar General Securities at various times during the Class Period.

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Lead Plaintiffs believe that the proposed Settlement is a very good recovery and is in the best interests of the Class. Following the Settlement, Lead Plaintiffs engaged in extensive additional discovery, including a review of hundreds of thousands of pages of internal Dollar General documents and depositions of eleven current and former officers, directors and employees of Dollar General, six of whom are named as individual Defendants in this Litigation. This discovery confirms Lead Plaintiffs' belief that the terms of the Settlement are fair, adequate, and reasonable. Lead Counsel have not received any payment for their services in prosecuting this Litigation on behalf of the Lead Plaintiffs and the members of the Class, nor have they been reimbursed for out-of-pocket expenses. If the Settlement is approved by the Court, counsel for the Lead Plaintiffs will apply to the Court for attorneys' fees of not more than 20.9% of the Cash Settlement Fund, the effective percentage allowed under Lead Counsel's agreement negotiated with the institutional Lead Plaintiffs in this action. Lead Plaintiffs and their Counsel also plan to seek reimbursement from the Cash Settlement Fund of litigation expenses and such other sums as are awarded to the Lead Plaintiffs directly related to their service as the Lead Plaintiffs, together not to exceed $1,250,000. If the amount requested by counsel is approved by the Court, the average cost per Dollar General Security would be approximately $0.23. For further information regarding the Settlement on this Notice, you may contact any of the following: Rick Nelson, Esq. MILBERG, WEISS, BERSHAD, HYNES & LERACH, LLP 401 B Street, Suite 1700 San Diego, CA 92101 Phone: 619-231-1058 Fax: 619-231-7423 Vincent R. Cappucci, Esq. Robert N. Cappucci, Esq. Adam F. Jachimowski, Esq. ENTWISTLE & CAPPUCCI, LLP 299 Park Avenue, 14th Floor New York, NY 10171 Phone: 212 894-7200 Fax: 212 894-7272

Jay W. Eisenhofer, Esq. Richard M. Donaldson, Esq. John Kairis, Esq. GRANT & EISENHOFER, P.A. 1220 N. Market Street, Suite 500 Wilmington, DE 19801-2599 Phone: 302-622-7000 Fax: 302-622-7100 DO NOT CONTACT THE COURT REGARDING THIS NOTICE THE FAIRNESS HEARING Pursuant to an Order of the Court, a hearing (the "Fairness Hearing") will be held on May 24, 2002, at 10:00 a.m. before the Honorable Thomas A. Wiseman, Jr. at the United States District Courthouse, 801 Broadway, Nashville, Tennessee 37203, for the purpose of determining: (1) whether the proposed Settlement of the above-captioned Litigation should be approved by the Court as substantively and procedurally fair, reasonable and adequate; (2) whether a plaintiff class should be certified pursuant to Federal Rules of Civil Procedure 23(a) and 23(b)(3); (3) whether the Proposed Plan of Allocation of Settlement proceeds is fair, reasonable, adequate and in the best interest of the Class; (4) whether the application of Lead Counsel for an award of attorneys' fees and reimbursement of expenses incurred in connection with this Litigation, together with interest thereon, should be approved; and (5) whether the Litigation should be dismissed with prejudice. CERTAIN DEFINITIONS As used in this Notice, the following terms have the meanings specified below: 1. "Class" means all persons and entities who during the Class Period (i) purchased, exchanged, otherwise acquired or made an investment decision (i.e., a decision by a Class Member not to sell Dollar General Securities held by the Class Member or a decision to allow options or other rights with respect to Dollar General Securities to expire) involving Dollar General Securities, or (ii) sold put options on Dollar General Securities; provided however, that Class does not include (a) such persons or entities who submit valid and timely requests for exclusion from the Class in accordance with the procedures set out herein, (b) such persons or entities who settled an actual or threatened lawsuit or other proceeding with the Company and released the Company from any further claims concerning their purchase, exchange, acquisition of, or investment decision involving, Dollar General Securities, or their sale of put options or other derivative instruments on Dollar General Securities, or (c) such persons or entities who are Defendants, members of the immediate family of the Individual Defendants, any entity in which Dollar General has or had a controlling interest during the Class Period or the legal representatives, heirs, executors, successors or assigns of any such excluded person or entity, or any directors or officers of Dollar General during the Class Period. Also excluded from the Class is any Non-Settling Defendant. 2. "Class Members" means all members of the Class, whether acting collectively or individually. 3. "Class Period" means the period commencing on March 5, 1997 through January 14, 2002, inclusive. 4. "Dollar General Securities" means any securities (i) issued by Dollar General, including but not limited to stock, bonds or derivative instruments or (ii) that trade in whole or in part based on the price or value of any security issued by Dollar General, including but not limited to put or call options, the STRYPES and any other derivative instruments. 5. "Defendants" means Dollar General, Cal Turner, Jr., James L. Clayton, John B. Holland, Barbara L. Bowles, Dr. E. Gordon Gee, Dennis C. Bohorff, Barbara M. Knuckles, Reginald D. Dickson, David Wilds, William S. Wire, II, Bob Carpenter, Brian M. B Phil urr, Richards and Randy Sanderson. 2

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6. "Individual Defendants" means Cal Turner, Jr., James L. Clayton, John B. Holland, Barbara L. Bowles, Dr. E. Gordon Gee, Dennis C. Bohorff, Barbara M. Knuckles, Reginald D. Dickson, David Wilds, William S. Wire, II, Bob Carpenter, Brian M. Burr, Phil Richards and Randy Sanderson. 7. "Person" means an individual, corporation, limited liability corporation, professional corporation, limited liability partnership, partnership, limited partnership, association, joint stock company, estate, legal representative, trust, unincorporated association, government or any political subdivision or agency thereof, and any business or legal entity and their spouses, heirs, predecessors, successors, representatives, or assignees. 8. "Lead Plaintiffs" means the Florida State Board of Administration and the Teachers' Retirement System of Louisiana, whom the Court has appointed as co-lead plaintiffs on behalf of the Class. 9. "Non-Settling Defendant" means any person who Lead Plaintiffs, the Class or any Class Member may hereafter sue on any claim based upon, relating to or arising out of the Released Claims, including but not limited to Deloitte & Touche LLP or PricewaterhouseCoopers LLP. 10. "Related Parties" as to Dollar General means each of the present or former officers, directors, employees, affiliates, parents, subsidiaries, divisions, general and limited partners and partnerships, stockholders, subrogees, insurers, and attorneys of Dollar General, and their respective representatives, heirs, executors, spouses, administrators, successors, transferees and assigns, except that Deloitte & Touche LLP, PricewaterhouseCooper LLP or any Non-Settling Defendant shall not be considered a Related Party of Dollar General. 11. "Related Parties" as to the I dividual Defendants means each of their present or former agents, attorneys, representatives, n associates, general and limited partners and partnerships, heirs, executors, administrators, successors and assigns, except that Deloitte & Touche LLP, PricewaterhouseCoopers LLP or any Non-Settling Defendant shall not be considered a Related Party of any Defendants. 12. "Released Claims" means each and every Claim or Unknown Claim, whether arising under any federal, state, or foreign statutory or common law or rule, including, without limitation, each and every Claim for negligence, gross negligence, indemnification, breach of duty of care and/or breach of duty of loyalty, fraud, breach of fiduciary duty or violations of state or federal statutes, rules or regulations, that has been, or might have been, or could be asserted against any of the Releasees at any time by or on behalf of any Class Member, in any capacity, in the Litigation or in any court, tribunal, or other forum of competent jurisdiction, arising out of or related, directly or indirectly, to the purchase, acquisition, exchange, retention, transfer or sale of, or investment decision involving Dollar General Securities during the Class Period (i.e., a decision by a Class member not to sell Dollar General Securities held by the Class Member or a decision to allow options or other rights with respect to Dollar General Securities to expire) any Claims arising out of or relating to: (a) any or all of the acts, omissions, matters, transactions, occurrences, or oral, or written statements or representations that have been, may be or could be directly or indirectly allege, asserted, described, set forth or referred to in this Litigation; (b) any SEC filing by any of the Releasees relating to Dollar General Securities or Dollar General during the Class Period; (c) any forward-looking statement made by any of the Releasees during the Class Period; (d) any adjustments, revisions or restatements of financial information of Dollar General during the Class Period; (e) any disclosures of any sort made by any of the Releasees during the Class Period to any third party regarding, without limitation, Dollar General's financial condition, its operational results and/or its operational prospects, including without limitations, press releases and/or press reports, and presentations to analysts, rating agencies, banks, Company employees, potential investors and/or shareholders; (f) any internal and/or external accounting reports or opinions prepared during or relating in any way to the Class Period, or on which any Class Member allegedly relied during the Class Period in purchasing, acquiring, exchanging, retaining, transferring, selling or making an investment decision with respect to Dollar General Securities; (g) the Company's recordkeeping during or relating in any way to the Class Period; (h) any financial statement, audited or unaudited, and any report or opinion on any financial statement relating to Dollar General that was prepared or issued during or relating in any way to the Class Period, or on which any Class Member allegedly relied during the Class Period in purchasing, acquiring, exchanging, retaining, transferring, selling or making an investment decision with respect to Dollar General Securities; (i) any statements or omissions by any of the Releasees as to quarterly or annual results of Dollar General during the Class Period; (j) any internal accounting controls or internal audits of Dollar General during or relating in any way to the Class Period; (k) any purchases, acquisitions, exchanges, sales, transfers or other trading of Dollar General Securities during the Class Period by any of the Releasees, or any acts taken by Releasees to finance or pay for such trades; and (l) any issues relating to the Company's accounting for its operations, including but not limited to, inventory valuation and obsolescence, expense accruals, reserves, general ledger balance reconciliations and synthetic leases. 13. "Claim" means (i) a demand (whether written or oral) or cause of action for monetary or non-monetary relief or (ii) a demand, cause of action or allegation in a civil, criminal or administrative proceeding in any judicial, arbitral, regulatory or other forum for monetary or non-monetary relief.

14. "Unknown Claim" means any Released Claim that any Class Member does not know or suspect to exist in his, her, or its favor at any time on or before the date that Class Member's release becomes effective, and that, if known by him, her, or it, might have affected his, her, or its settlement with the Releasees or might have affected his, her, or its decision not to request exclusion from the Class or not to object to the Settlement Agreement. 3

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15. "Releasees" means each and every one of the following: Dollar General and all of its predecessors and present and former parents, subsidiaries a affiliates, and each of their respective past and present directors, officers, employees, partners, principals, agents, nd attorneys, advisors, consultants, representatives, directors and officers liability insurers, the Individual Defendants and each of t eir heirs, h executors, trusts, trustees, administrators and assigns and the Dollar General STRYPES Trust; provided however; that the term Releasees shall not include Deloitte & Touche or PricewaterhouseCoopers LLP. 16. "Settling Defendants" means Dollar General and the Individual Defendants.

17. "STRYPES" means the Structured Yield Product Exchangeable for Stock issued on May 21, 1998 by the Dollar General STRYPES Trust and exchanged at maturity on May 15, 2001 for Dollar General common stock. BACKGROUND OF THE LITIGATION On April 30, 2001, Dollar General reported that it would delay filing its Form 10-K and annual report for fiscal year 2000 in anticipation of restating its audited financial statements for fiscal years 1998 and 1999, as well as its unaudited financial information for year 2000 (the "Restatement"). The Company attributed the necessity of the Restatement to its discovery of "accounting irregularities." The Company also reported that its Audit Committee had engaged special counsel and independent accounting consultants and that the Company and the Audit Committee would investigate "allegations of fraudulent behavior" and review the Company's internal accounting controls and financial reporting processes. On the news, trading in Dollar General's stock, which had traded during the Class Period as high as $32.625 (taking into account stock splits), plunged to $16.50. On September 21, 2001, the Company reported that its Restatement would include a correction for its improper accounting for synthetic leases which should have been accounted for as operating leases, resulting in a further drop in Dollar General's stock to as low as $10.50 per share. Finally, on January 14, 2002, Dollar General filed its Restatement and audited financials for fiscal years 1998 through 2000. Following the Company's April 30, 2001 announcement, the following actions were filed in or transferred to the United States District Court for the Middle District of Tennessee, as class actions on behalf of persons who purchased the common stock of Dollar General, or sold put options on such stock, during a defined period of time: Pirelli Armstrong Tire Corp. Retiree Medical Benefits Trust v. Dollar General Corp., et al., Civ. Action No. 3:01-0388 Andre Engle v. Dollar General Corp., et al., Civ. Action No. 3:01-0389 Peter Medina v. Dollar General Corp., et al., Civ. Action No. 3:01-0392 Terri L. Koller IRRA FBO Terri L. Koller v. Dollar General Corp., et al., Civ. Action No. 3:01-0393 David F. Hinds v. Dollar General Corp., et al., Civ. Action No. 3:01-0394 Sharon Dickson v. Dollar General Corp., et al., Civ. Action No. 3:01-0396 Laura Kinder v. Dollar General Corp., et al., Civ. Action No. 3:01-0398 Charles Kitchner v. Dollar General Corp., et al., Civ. Action No. 3:01-0399 Ilene Armour v. Dollar General Corp., et al., Civ. Action No. 3:01-0400 Jody Eisenman v. Dollar General Corp., et al., Civ. Action No. 3:01-0401 Sharon Wolf v. Dollar General Corp., et al., Civ. Action No. 3:01-0407 James Hosford v. Dollar General Corp., et al., Civ. Action No. 3:01-0422 Snopes Capital Management v. Dollar General Corp., et al., Civ. Action No. 3:01-0425 David C. Baarlaer v. Dollar General Corp., et al., Civ. Action No. 3:01-0433 Harriet R. Stark v. Dollar General Corp., et al., Civ. Action No. 3:01-0438 Detectives Endowment Association Annuity Fund v. Dollar General Corp., et al., Civ. Action No. 3:01-0439 Case Stationery Company v. Dollar General Corp., et al., Civ. Action No. 3:01-0029 George Freeman v. Dollar General Corp., et al., Civ. Action No. 3:01-0506 Anthony Kurtz and Kimberly Kurtz v. Dollar General Corp., et al., Civ. Action No. 3:01-0514 Lee S. Grubman v. Dollar General Corp., et al., Civ. Action No. 3:01-0528 Shriners Hospitals for Children v. Dollar General Corp., et al., Civ. Action No. 3:01-0552 City of Philadelphia, acting through its Board of Pensions and Retirement v. Dollar General Corp., et al., Civ. Action No. 3:01-0587 Mark Seto v. Dollar General Corp., et al., Civ. Action No. 3:01-1274 Frank H. Adolf v. Dollar General Corp., et al., Civ. Action No. 3:01-1364 By order dated May 22, 2001, these actions (the "Litigation") were consolidated for all purposes as In re Dollar General Corporation Securities Litigation, Civ. Action No. 3:01-0388. On July 20, 2001, the Court also appointed Lead Plaintiffs and Lead Counsel for the proposed plaintiff class. Lead Counsel undertook an intensive months-long investigation into the matters giving rise to Dollar General's restated financials and the claims in the Litigation. That investigation involved, among other things, a review and analysis of Dollar General's public filings, literally dozens of witness interviews (including former Dollar General employees and management personnel), the creation of a website seeking relevant information and witnesses, and the independent efforts of two separate teams of outside investigators. Based on the results of this investigation, Lead Plaintiffs filed their Amended Complaint on January 3, 2002, and a Second Amended Complaint on April 1, 2002 ("Complaint") asserting claims under sections 10(b) (and Rule 10b-5) and 20 of the Securities Exchange Act of 1934 (the "1934 Act") and Tennessee common law.

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The Complaint is brought on behalf of Lead Plaintiffs and a Class consisting of all persons who purchased Dollar General Securities or sold put options or made an investment decision involving such Securities during the period from March 5, 1997 through January 14, 2002, inclusive. In the Complaint, Lead Plaintiffs allege, among other things, that the Defendants disseminated false and misleading information during the Class Period regarding, among other things, Dollar General's financial condition and prospects, which had the result of artificially inflating the market price of Dollar General Securities, causing those who engaged in transactions in such Securities or made investment decisions involving such Securities during the Class Period to do so based on inflated prices. The Complaint seeks damages for persons who sustained a loss upon the sale of D ollar General Securities purchased during the Class Period or who still hold their Securities purchased during the Class Period, and damages for those persons who sustained losses upon the sale of put options or the making of investment decisions during the Class Period. The Defendants include certain current and former officers, directors and/or employees of Dollar General. The Lead Plaintiffs and the Defendants ultimately held settlement discussions and subsequently agreed on the terms of an agreement w hich would resolve all claims asserted in the Litigation. During the course of the settlement discussions, the Lead Plaintiffs consulted with outside experts on key aspects of the Litigation, including complicated accounting and auditing issues. Lead Counsel and their experts also reviewed the Company's unaudited restated financial statements for the Company's fiscal year 1998, 1999 and 2000. The parties negotiated a stipulated protective order, pursuant to which Dollar General provided hundreds of thousands of pages of internal Company documents relating to the events and transactions that gave rise to the restated financials. These documents were reviewed and analyzed by Lead Counsel and their experts. Lead Counsel also conducted interviews and depositions of current and former Dollar General officers, directors and management personnel with key roles in or extensive knowledge of the decisions and transactions giving rise to this Litigation. EFFECT OF CLASS DETERMINATION If you are a member of the Class as defined herein, your legal rights with respect to the claims asserted against the Defendants will be determined in this action and you will be bound by any order or judgment that the Court has entered or will enter with respect to the Class, unless you timely request to be excluded from the Class in the manner set forth below. If you choose to be excluded from the Class, you will not be bound by the outcome of this Litigation but you will also not be entitled to share in any recovery in the Litigation (INCLUDING THE SETTLEMENT DESCRIBED BELOW), if any recovery is achieved. BENEFITS OF SETTLEMENT AND RISK OF FURTHER LITIGATION Lead Plaintiffs believe that the claims asserted in the Litigation have merit and that the evidence supports the claims against the Defendants. Lead Plaintiffs also believe that the proposed Settlement will provide a significant monetary benefit to Class Members, and provide significant future non-monetary benefits in the form of corporate governance changes and policies (described herein) that Dollar General must adopt which will enhance the Company's internal controls and corporate governance. However, Lead Plaintiffs recognize that there are significant risks associated with continuing to litigate and proceeding to trial. The Class faced the possibility that many of the claims in this case could have been disposed of pursuant to any motions to dismiss or motions for summary judgment that Defendants could file before trial. There was also a risk that the Class would not have been certified, or would not have prevailed on their claims against the Defendants even if those claims eventually went to trial, in which case the Class would receive nothing. Moreover, had the case proceeded to trial and assuming the Lead Plaintiffs had been able to establish liability of the Defendants, the amount of damages recoverable by Class Members would have been subject to rigorous attack by the Defendants. Recoverable damages are limited to losses caused by conduct actionable under applicable securities laws and, had the Litigation gone to trial, Defendants would have tried to prove that all or most of the losses (if any) of Class Members were caused by non-actionable market, industry or other general economic factors. The proposed Settlement eliminates these risks and provides an immediate recovery for Class Members. Based on their evaluation, Lead Plaintiffs and their counsel have determined that the Settlement is in the best interests of the Lead Plaintiffs and the Class. DEFENDANTS' DENIALS OF WRONGDOING AND LIABILITY The Defendants have denied and continue to deny each and all of the claims and contentions alleged by the Lead Plaintiffs in the Litigation. The Defendants expressly have denied and continue to deny all charges of wrongdoing or liability against them arising out of any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in the Litigation. The Defendants also have denied and continue to deny, inter alia, the allegations that the Lead Plaintiffs or the Class have suffered damage or that the Lead Plaintiffs or the Class were harmed by the conduct alleged in the Litigation. Nonetheless, the Defendants have concluded that further conduct of the Litigation would be protracted and expensive, and that it is desirable that the Litigation against them be fully and finally settled in the manner and upon the terms and conditions set forth in the Stipulation. The Defendants also have taken into account the uncertainty and risks inherent in any litigation, especially in complex cases like the Litigation. The Defendants have, therefore, determined that it is desirable and beneficial to them that the Litigation against them be settled in the manner and upon the terms and conditions set forth in the Stipulation. THE RIGHTS OF CLASS MEMBERS If you are a Class Member, you may receive the benefit of and you will be bound by the terms of the proposed Settlement described in this Notice, upon approval of the Settlement by the Court. If you are a Class Member, you have the following options: 1. You may file a Proof of Claim as described below. If you choose this option, you will remain a Class Member, you will share in the proceeds of the proposed Settlement if your claim is timely and valid and if the proposed Settlement is finally approved by the Court, and you will be bound by the Judgment and release described below.

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2. You may elect to be excluded from the Class. If you exclude yourself from the Class, you will not participate in the Settlement, and you will not receive the benefits of the Settlement. You will not be bound by the judgments to be entered in the Litigation dismissing the Defendants, and none of your claims will be released in connection with the Settlement. If you want to be excluded from the Class, you must mail or deliver, such that it is received on or before May 14, 2002 a written request for exclusion to the following: In re Dollar General Securities Litigation c/o The Garden City Group, Inc. Claims Administrator P.O. Box 8850 Melville, New York 11747-8850 This request for exclusion must be signed by you and must contain the following information: (a) your name and address, and the name and address of the record holder of your Dollar General Securities if different from your own; (b) the number and type of shares of Dollar General Securities you bought or otherwise acquired from March 5, 1997 through and including January 14, 2002, the date of each purchase or acquisition, and the purchase or acquisition price; (c) the number of put or call options on Dollar General common stock you sold, purchased or otherwise acquired from March 5, 1997 through and including January 14, 2002, the date of each sale, purchase or acquisition and the sale or purchase price. In your exclusion request, please include the reference Dollar General Securities Litigation. 3. If you have not requested to be excluded from the Class, you may object to the Settlement, the Plan of Allocation and/or the application of Lead Counsel for an award of attorneys' fees and reimbursement of expenses in the manner set forth below. The filing of a Proof of Claim by a Class Member does not preclude a Class Member from objecting to the Settlement. However, if your objection is rejected you will be bound by the Settlement and the Judgment (described below) just as if you had not objected. 4. You may do nothing at all. If you choose this option, and if you have not previously requested in writing to be excluded from the Class, you will not share in the proceeds of the Settlement, but you will be bound by any and all determinations or judgments in the Litigation in connection with the Settlement entered into or approved by the Court, whether favorable or unfavorable to the Class including, without limitation, the Judgment described below, and you shall be deemed to have, and by operation of the Judgment shall have fully released all of the Released Claims against the Defendants and the Related Parties. 5. If you are a Class Member, you may, but are not required to, enter an appearance through counsel of your own choosing at your own expense. If you do not do so, you will be represented by the law firms which have been appointed by the Court as co-lead counsel for the Lead Plaintiffs and the Class. TERMS OF THE PROPOSED SETTLEMENT Settlements have been reached in the Litigation between the Lead Plaintiffs and the Defendants which are embodied in (1) a Stipulation of Settlement between the Lead Plaintiffs (on behalf of themselves and all Class Members) and the Defendants, dated as of April 1, 2002 (the "Stipulation"), which is on file with the Court. The Settlement set forth in the Stipulation would resolve and extinguish all claims in the Litigation, and would result in dismissal of the Litigation with prejudice. The Lead Plaintiffs and their counsel, on the basis of, among other things, a thorough investigation of the facts and the law relating to the acts, events, and conduct complained of and the subject matter of the Litigation, have concluded that the proposed Settlement is fair to and in the best interests of the Class. The following description of the proposed Settlement of the Litigation is only a summary, and reference is made to the text of the Stipulation, on file with the Court, for a full statement of its provisions: 1. The Settlement will result in the creation of a Settlement Fund consisting of approximately $162 million in cash plus any interest that may accrue thereon prior to distribution. 2. The Settlement requires Dollar General to adopt an array of corporate governance measures designed to enhance the Company's internal controls and corporate governance. For example, these measures require the Company's directors to stand for election every year and at least two-thirds of the directors must be independent (as defined in the Stipulation); the independent directors must meet at least once per year without the Company's CEO or other non-independent directors; the board shall maintain an Audit Committee and a Corporate Governance Committee comprised entirely of independent directors; and the Company must maintain and intensive internal audit function and insider trading policies. 3. Upon approval of the Stipulation by the Court and entry of judgment that becomes a final judgment and upon satisfaction of the other conditions to the Settlement, described below, the Settlement Fund will be distributed as follows: (a) To pay costs and expenses in connection with providing notice to the members of the Class and administering the Settlement on behalf of the Class; (b) To pay Lead Plaintiffs and their attorneys such fees, expenses and costs, with interest thereon (the "Fee and Expense Award"), as are allowed by the Court; (c) To pay the reasonable costs incurred in the preparation of any tax returns required to be filed on behalf of the Settlement Fund as well as the taxes (and any interest and penalties determined to be due thereon) owed by reason of the earnings of the Settlement Fund, including all Taxes and Tax Expenses as defined in the Stipulation; and (d) Subject to the approval by the Court of the Plan of Allocation described below, the balance of the Settlement Fund (the "Net Settlement Fund"), shall be distributed to Class Members who submit valid, timely Proof of Claim forms ("Authorized Claimants").

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The proposed Plan of Allocation provides for distribution of the Net Settlement Fund to Authorized Claimants as follows: Each Person claiming to be an Authorized Claimant shall be required to submit a separate Proof of Claim and Release signed under penalty of perjury and supported by such documents as specified in the Proof of Claim as are reasonably available to the Authorized Claimant. All Proof of Claim forms must be postmarked or received by July 8, 2002, addressed as follows: In re Dollar General Securities Litigation c/o The Garden City Group, Inc. Claims Administrator P.O. Box 8850 Melville, New York 11747-8850 Unless otherwise ordered by the Court, any Class Member who fails to submit a properly completed and signed Proof of Claim within such period, or such other period as may be ordered by the Court, shall be forever barred from receiving any payments pursuant to the Stipulation, but will in all other respects be subject to the provisions of the Stipulation and the final judgment entered by the Court. The Net Settlement Fund will be distributed to Authorized Claimants pursuant to the terms of the Plan of Allocation described below. The Plan of Allocation provides that a Settlement Class Member will be eligible to participate in the distribution of the Net Settlement Fund only if he, she, or it has a net loss on all transactions in Dollar General common stock, call and put options, 8 5/8% Notes, and/or STRYPES (the "Dollar General Securities") during the Settlement Class Period. To the extent there are sufficient funds in the Net Settlement Fund, each Authorized Claimant will receive an amount equal to the Authorized Claimant's claim, as defined below. If, however, the amount in the Net Settlement Fund is not sufficient to permit payment of the total claim of each Authorized Claimant, then each Authorized Claimant shall be paid the percentage of the Net Settlement Fund that each Authorized Claimant's claim bears to the total of the claims of all Authorized Claimants. P ayment in this manner shall be deemed conclusive against all Authorized Claimants. A claim will be calculated as follows: Common Stock 1. For shares of Dollar General common stock that were purchased on March 5, 1997 through and including February 23, 1998, and a) sold prior to January 15, 2002, the claim per share is $0; or b) retained at the end of January 14, 2002, the claim per share is $0.05. For shares of Dollar General common stock that were purchased on February 24, 1998 through and including February 22, 1999, and a) sold prior to September 24, 2001, the claim per share is $0; b) sold from September 24, 2001 through January 14, 2002, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $0.96 (the difference in the price inflation during the purchase period and during the sales period); or c) retained at the end of January 14, 2002, the claim per share is $1.05. For shares of Dollar General common stock that were purchased on February 23, 1999 through and including February 21, 2000, and a) sold prior to February 22, 2000, the claim per share is $0; b) sold from February 22, 2000 through February 26, 2001, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $0.30 (the difference in the price inflation during the purchase period and during the sales period); c) sold from February 27, 2001 through April 29, 2001, the claim per share is $0; d) sold from April 30, 2001 through September 23, 2001, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $1.34 (the difference in the price inflation during the purchase period and during the sales period); e) sold from September 24, 2001 through January 14, 2002, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $3.10 (the difference in the price inflation during the purchase period and during the sales period); or f) retained at the end of January 14, 2002, the claim per share is $3.19. For shares of Dollar General common stock that were purchased on February 22, 2000 through and including February 26, 2001, and a) sold prior to April 30, 2001, the claim per share is $0; b) sold from April 30, 2001 through September 23, 2001, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments or (ii) $1.04 (the difference in the price inflation during the purchase period and during the sales period); c) sold from September 24, 2001 through January 14, 2002, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $2.81 (the difference in the price inflation during the purchase period and during the sales period); or 7

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retained at the end of January 14, 2002, the claim per share is $2.89.

For shares of Dollar General common stock that were purchased on February 27, 2001 through and including April 29, 2001, and a) sold prior to April 30, 2001, the claim per share is $0; b) sold from April 30, 2001 through September 23, 2001, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $2.83 (the difference in the price inflation during the purchase period and during the sales period); c) sold from September 24, 2001 through January 14, 2002, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $4.59 (the difference in the price inflation during the purchase period and during the sales period); or d) retained at the end of January 14, 2002, the claim per share is $4.68. For shares of Dollar General common stock that were purchased on April 30, 2001 through and including September 23, 2001, and a) sold prior to September 24, 2001, the claim per share is $0; b) sold from September 24, 2001 through January 14, 2002, the claim per share is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $1.76 (the difference in the price inflation during the purchase period and during the sales period); or c) retained at the end of January 14, 2002, the claim per share is $1.85. For shares of Dollar General common stock that were purchased on September 24, 2001 through and including January 14, 2002, and a) sold prior to January 15, 2002, the claim per share is $0; or b) retained at the end of January 14, 2002, the claim per share is $0.09. Call Options

6.

7.

1.

For Call Options on Dollar General common stock that were purchased on March 5, 1997 through and including February 23, 1998, and a) sold or expired prior to January 15, 2002, the claim per option is $0; or b) retained after January 14, 2002, the claim per option is $0.05. For Call Options on Dollar General common stock that were purchased on February 24, 1998 through and including February 22, 1999, and a) sold or expired prior to September 24, 2001, the claim per option is $0; b) sold or expired from September 24, 2001 through January 14, 2002, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $0.96; or c) open and retained after January 14, 2002, the claim per option is $1.05. For Call Options on Dollar General common stock that were purchased on February 23, 1999 through and including February 21, 2000, and a) sold or expired prior to February 22, 2000, the claim per option is $0; b) sold or expired from February 22, 2000 through February 26, 2001, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $0.30; c) sold or expired from February 27, 2001 through April 29, 2001, the claim per option is $0; d) sold or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $1.34; e) sold or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $3.10; or f) open and retained after January 14, 2002, the claim per option is $3.19. For Call Options on Dollar General common stock that were purchased on February 22, 2000 through and including February 26, 2001, and a) sold or expired prior to April 30, 2001, the claim per option is $0; b) sold or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $1.04; c) sold or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $2.81; or d) open and retained after January 14, 2002, the claim per option is $2.89. For Call Options on Dollar General common stock that were purchased on February 27, 2001 through and including April 29, 2001, and a) sold or expired prior to April 30, 2001, the claim per option is $0; b) sold or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $2.83; c) sold or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $4.59; or d) open and retained after January 14, 2002, the claim per option is $4.68.

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For Call Options on Dollar General common stock that were purchased on April 30, 2001 through and including September 23, 2001, and a) sold or expired prior to September 24, 2001, the claim per option is $0; b) sold or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the price paid and the proceeds received, or (ii) $1.76; or c) open and retained after January 14, 2002, the claim per option is $1.85. For Call Options on Dollar General common stock that were purchased on September 24, 2001 through and including January 14, 2002, and a) sold or expired prior to January 15, 2002, the claim per option is $0; or b) open and retained after January 14, 2002, the claim per option is $0.09. Put Options

7.

1.

For Put Options on Dollar General common stock that were sold on March 5, 1997 through and including February 23, 1998, and a) closed out or expired prior to January 15, 2002, the claim per option is $0; or b) open after January 14, 2002, the claim per option is $0.05. For Put Options on Dollar General common stock that were purchased on February 24, 1998 through and including February 22, 1999, and a) closed out or expired prior to September 24, 2001, the claim per option is $0; b) closed out or expired from September 24, 2001 through January 14, 2002, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $0.96; or c) open after January 14, 2002, the claim per option is $1.05. For Put Options on Dollar General common stock that were purchased on February 23, 1999 through and including February 21, 2000, and a) closed out or expired prior to February 22, 2000, the claim per option is $0; b) closed out or expired from February 22, 2000 through February 26, 2001, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $0.30; c) closed out or expired from February 27, 2001 through April 29, 2001, the claim per option is $0; d) closed out or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $1.34; e) closed out or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $3.10; or f) open after January 14, 2002, the claim per option is $3.19. For Put Options on Dollar General common stock that were purchased on February 22, 2000 through and including February 26, 2001, and a) closed out or expired prior to April 30, 2001, the claim per option is $0; b) closed out or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $1.04; c) closed out or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $2.81; or d) open after January 14, 2002, the claim per option is $2.89. For Put Options on Dollar General common stock that were purchased on February 27, 2001 through and including April 29, 2001, and a) closed out or expired prior to April 30, 2001, the claim per option is $0; b) closed out or expired from April 30, 2001 through September 23, 2001, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $2.83; c) closed out or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $4.59; or d) open after January 14, 2002, the claim per option is $4.68. For Put Options on Dollar General common stock that were purchased on April 30, 2001 through and including September 23, 2001, and a) closed out or expired prior to September 24, 2001, the claim per option is $0; b) closed out or expired from September 24, 2001, through January 14, 2002, the claim per option is the lesser of: (i) the difference between the proceeds paid and the price received, or (ii) $1.76; or c) open after January 14, 2002, the claim per option is $1.85. For Put Options on Dollar General common stock that were purchased on September 24, 2001 through and including January 14, 2002, and a) closed out or expired prior to January 15, 2002, the claim per option is $0; or b) open after January 14, 2002, the claim per option is $0.09. 8 5/8% Notes

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For Dollar General 8 5/8% Notes that were purchased on June 16, 2000 through and including April 29, 2001, and 9

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sold prior to April 30, 2001, the claim per note is $0; sold from April 30, 2001 through January 14, 2002, the claim per note is the purchase price less the sales price and cumulative interest payments; or retained at the end of January 14, 2002, the claim per note is the purchase price less the January 15, 2002 price and cumulative interest payments.

2.

For Dollar General 8 5/8% Notes that were purchased on April 30, 2001 through and including September 23, 2001, and a) sold prior to September 24, 2001, the claim per note is $0; b) sold from September 24, 2001 through January 14, 2002, the claim per note is the purchase price less the sales price and cumulative interest payments; or c) retained at the end of January 14, 2002, the claim per note is the purchase price less the January 15, 2002 price and cumulative interest payments. For Dollar General 8 5/8% Notes that were purchased on September 24, 2001 through and including January 14, 2002, and a) sold prior to January 14, 2002, the claim per note is $0; or b) retained at the end of January 14, 2002, the claim per note is the purchase price less the January 15, 2002 price and cumulative interest payments. STRYPES

3.

1.

For Dollar General STRYPES that were purchased on May 21, 1998 through and including February 22, 1999, the claim per STRYPES is $0. For Dollar General STRYPES that were purchased on February 23, 1999 through and including February 21, 2000, and a) sold prior to February 22, 2000, the claim per STRYPES is $0; b) sold from February 22, 2000 through February 26, 2001, the claim per STRYPES is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $0.58 (the difference in the price inflation during the purchase period and during the sales period); c) sold from February 27, 2001 through April 29, 2001, the claim per STRYPES is $0; d) sold from April 30, 2001 through May 15, 2001, the claim per STRYPES is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $2.62 (the difference in the price inflation during the purchase period and during the sales period); For Dollar General STRYPES that were purchased on February 22, 2000 through and including February 26, 2001, and a) sold prior to April 30, 2001, the claim per STRYPES is $0; b) sold from April 30, 2001 through May 15, 2001, the claim per STRYPES is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $2.04 (the difference in the price inflation during the purchase period and during the sales period); For Dollar General STRYPES that were purchased on February 27, 2001 through and including April 29, 2001, and a) sold prior to April 30, 2001, the claim per STRYPES is $0; b) sold from April 30, 2001 through May 15, 2001, the claim per STRYPES is the lesser of: (i) the purchase price less the sales price and cumulative dividend payments, or (ii) $5.52 (the difference in the price inflation during the purchase period and during the sales period); For Dollar General STRYPES that were purchased on April 30, 2001 through and including May 15, 2001, the claim per STRYPES is $0.

2.

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5.

The Claims for persons who held Dollar General common stock or put options at the beginning of the Class Period and made a decision during the Class Period not to sell their Dollar General common stock or exercise their put options will be calculated as the lesser of: (i) the actual purchase price of such security less the sale price, if any, or (ii) the price inflation of such security calculated as if the security had been purchased, exchanged or otherwise acquired on the first day of the Class Period. In no event shall the total recovery of purchasers of Call Options on Dollar General common stock exceed 1½% of the Net Settlement Fund. In no event shall the total recovery of purchasers of Put Options on Dollar General common stock exceed ½% of the Net Settlement Fund. In no event shall the total recovery of purchasers of Dollar General 8 5/8% Notes exceed 2% of the Net Settlement Fund. In no event shall the total recovery of purchasers of Dollar General STRYPES exceed 3% of the Net Settlement Fund. The date of purchase or sale is the "contract" or "trade" date as distinguished from the "settlement" date. The determination of the price paid per security and the price received per security, shall be exclusive of all commissions, taxes, fees and charges. For Class Members who held Dollar General at the beginning of the Class Period or made multiple purchases or sales during the Class Period, the first-in, first-out ("FIFO") method will be applied to such holdings, purchases and sales for purposes of calculating a claim. Under the FIFO method, a Dollar General Security sold during the Settlement Class Period will be matched, in chronological order, first against the Dollar General Security held at the beginning of the Settlement Class Period. The remaining sales of a Dollar General Security during the Settlement Class Period will then be matched, in chronological order, against such Dollar General Securities purchases during the Settlement Class Period. 10

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A Class Member will be eligible to receive a distribution from the Net Settlement Fund only if a Class Member had a net loss, after all profits from transactions in Dollar General Securities are subtracted from all losses. However, the proceeds from sales of Dollar General Securities which have been matched against Dollar General Securities held at the beginning of the Settlement Class Period will not be used in the calculation of such net loss. The Court has reserved jurisdiction to allow, disallow or adjust the claim of any Settlement Class Member on equitable grounds. Payment pursuant to the Plan of Allocation set forth above shall be conclusive against all Authorized Claimants. No Person shall have any claim against the Lead Plaintiffs or their counsel or any claims administrator or other agent designated by the Lead Plaintiffs or their counsel, or against Defendants or Defendants' counsel, based on distributions made substantially in accordance with the Stipulation and the Settlement contained therein, the Plan of Allocation, or further orders of the Court. All Class Members who fail to complete and file a valid and timely Proof of Claim and Release shall be barred from participating in distributions from the Settlement Fund (unless otherwise ordered by the Court), but otherwise shall be bound by all of the terms of the Stipulation, including the terms of any judgment(s) entered and the releases given. To share in the Settlement Fund, you must submit a valid Proof of Claim and Release on the form enclosed with this Notice no later than July 8, 2002 to the address set forth in the attached Proof of Claim form. The Settlement Fund, less any deductions for fees and costs allowed by the Court, taxes due and other deductions pursuant to the terms of the Stipulation, shall be maintained by the Escrow Agent for the benefit of the Class, as provided in the Stipulation. CONDITIONS FOR SETTLEMENT The Settlement is conditioned upon the occurrence of certain events described in the Stipulation. Those events include, among other things: (1) entry of the Judgment by the Court, as provided for in the Stipulation; and (2) expiration of the time to appeal from or alter or amend the Judgment(s). If, for any reason, any one of the conditions described in the Stipulation is not met, the Stipulation might be terminated and, if terminated, will become null and void, and the parties to the Stipulation will be restored to their respective positions prior to the Settlement. DISMISSAL AND RELEASE 1. If the Settlement is approved by the Court, the Court will enter judgment which in substance will have the following effects. First, all Class Member claims against Defendants and the Related Parties relating to the Litigation or Dollar General will be released and the Litigation will be dismissed with prejudice. Second, Defendants will be given certain protections against lawsuits by others in connection with Dollar General, resulting in the possibility of a reduction in the recovery by any Class Member who sues anyone else who then tries to sue a Defendant. (This is meant to be only a general description of the dismissal, release, and bar order provisions of the Settlement, and anyone interested in more detail is invited to study the Stipulation themselves.) 2. The Court shall retain jurisdiction over implementation of the Settlement, disposition of the Settlement Fund, hearing and determining Lead Plaintiffs' counsel's application(s) for attorneys' fees, costs, interest and expenses (including fees and costs of experts), and enforcing and administering the Stipulation, including any releases executed in connection therewith. 3. The judgments will provide that all Class Members who do not validly and timely request to be excluded from the Class shall be deemed to have released and forever discharged all released claims (to the extent Members of the Class have such claims) against all Defendants. NOTICE TO BANKS, BROKERS, AND OTHER NOMINEES Banks, brokerage firms, institutions, and other Persons who are nominees who purchased Dollar General Securities for the beneficial interest of other Persons as of any day from March 5, 1997 through and including January 14, 2002 are requested within ten (10) days of receipt of the Notice, to (1) provide the Claims Administrator with the names and addresses of such beneficial purchasers, or to (2) forward a copy of this Notice to each such beneficial purchaser and provide the Claims Administrator with written confirmation that this Notice has been so forwarded. Lead Counsel offer to reimburse your reasonable costs and expenses of complying with this provision upon submission of appropriate documentation. Additional postage pre-paid copies of the Notice may be obtained from the Claims Administrator for forwarding to such beneficial owners. All such correspondence to the Claims Administrator should be addressed as follows: In re Dollar General Securities Litigation c/o The Garden City Group, Inc. Claims Administrator P.O. Box 8850 Melville, New York 11747-8850 Toll-free line: 1-888-298-1077 ATTORNEYS' FEES, COSTS AND/OR EXPENSES OF PLAINTIFFS' COMMITTEE AND ITS ATTORNEYS To date, Lead Counsel have not received any payment for their services in conducting this Litigation on behalf of the Lead Plaintiffs and the members of the Class, nor have counsel been reimbursed for their out-of-pocket expenses. The Lead Plaintiffs and their counsel in the Litigation will apply to the Court at the conclusion of the Hearing described below, for an award of attorneys' fees of not to exceed 20.9% of the Settlement Fund. The Lead Plaintiffs and their counsel will also apply to the Court for reimbursement of litigation expenses which were advanced in connection with the Litigation and such other sums as are allowed to the Lead Plaintiffs directly relating to their representation of the Class, together not to exceed $1,250,000. Such sums as may be granted by the Court will be paid from the Settlement Fund. Class Members are not personally liable for any fees or expenses awarded by the Court. 11

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The fee requested by plaintiffs' counsel will compensate them for their efforts in achieving the Settlement Fund for the benefit of the Class, and for their risk in undertaking this case on a contingent basis. If approved by the Court, the fee requested would be within the range of fees awarded to plaintiffs' counsel under similar circumstances in litigation of this type. OBJECTIONS TO THE PROPOSED SETTLEMENT Any member of the Class who has not requested exclusion may appear at the Settlement Hearing to show cause why the proposed Settlement should not be approved, or the Litigation should not be dismissed with prejudice, and to present any opposition to the Plan of Allocation or the application of Lead Plaintiffs or their counsel for attorneys' fees, costs and expenses; provided, however, that no such Person shall be heard, unless his or her objection or opposition is made in writing and is filed, together with copies of all other papers and briefs by him or her with the Court no later than May 14, 2002 and received (by fax or otherwise) on or before May 14, 2002, by each of the following: Jay W. Eisenhofer, Esq. Richard M. Donaldson, Esq. John Kairis, Esq. GRANT & EISENHOFER, P.A. 1220 N. Market Street, Suite 500 Wilmington, DE 19801-2599 Phone: 302-622-7000 Fax: 302-622-7100 Keith F. Park, Esq. Darren J. Robbins, Esq. Helen J. Hodges, Esq. MILBERG, WEISS, BERSHAD, HYNES & LERACH, LLP 401 B Street, Suite 1700 San Diego, CA 92101 Phone: 619-231-1058 Fax: 619-231-7423 Ralph C. Ferrara, Esq. Jonathan R. Tuttle, Esq. DEBEVOISE & PLIMPTON 555 13th Street, N.W., Suite 1100 East Washington, DC 20004 Phone : 202-383-8000 Fax : 202-383-8118

Vincent R. Cappucci, Esq. Robert N. Cappucci, Esq. Adam F. Jachimowski, Esq. ENTWISTLE & CAPPUCCI, LLP 299 Park Avenue, 14th Floor New York, NY 10171 Phone: 212-894-7200 Fax: 212-894-7272

Unless otherwise ordered by the Court, any member of