SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
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General Mills, Inc.
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(Name of Registrant as Specified in Its Charter)
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On September 4, 2003, James A. Lawrence, Executive Vice President and Chief
Financial Officer of General Mills, Inc., made a webcast presentation to
investors. Selected pages from the script and slides for the presentation are
attached to this Schedule.
For more than 15 years, General Mills has sponsored long-term compensation plans
designed to ensure all employees are owners. These plans are part of an overall
compensation system that is highly dependent on performance. Base salaries at
General Mills are generally lower than those at peer companies. These salaries
are coupled with annual cash incentives determined by individual, business unit
and overall company performance. So we earn above-average compensation in years
when our performance is strong, and our compensation falls when results don't
meet our goals.
Long-term compensation has been entirely stock-based, with programs
ranging from all-employee option grants to an innovative salary replacement
program that allowed eligible employees to forego their annual merit salary
increases and choose stock options instead.
These programs did exactly what they were designed to do -- they made
our employees shareholders, and they strengthened everyone's focus on the
importance of making business decisions that lead to sustained business growth
and returns. Our stock plans also have created a large balance of options
outstanding, because they have been extended to all employees, they typically
require a 4-year vesting period, and our track record of consistent growth
causes many people to wait until close to the 10-year expiration date before
they exercise.
SLIDE 39 - GMI COMPENSATION PHILOSOPHY
GENERAL MILLS
COMPENSATION PHILOSOPHY
o Stock Ownership is Emphasized
o Pay is Performance-based
o Long-term Compensation is
Stock-based
- All-employee Stock Option Grants
- Innovative Programs to Build Employee
Ownership
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GENERAL MILLS
We've been modifying our stock-based plans over the last several years in order
to begin reducing our options overhang. The 2003 stock plan shareholders are
being asked to approve at our annual meeting later this month will continue this
process, because it calls for a blend of restricted stock and stock options,
rather than options alone. The grant size will vary with company performance
against financial measures set at the beginning of each year. We think this plan
strikes a good balance of reducing our option overhang and sustaining our
commitment to stock-based compensation as a means of aligning company and
shareholder interests. I hope those of you in the audience who are General Mills
shareholders will review the background materials we've provided in the proxy
and vote in support of this plan.
SLIDE 40 - 2003 STOCK PLAN
GENERAL MILLS
2003 STOCK PLAN
o A Blend of Stock Options and
Restricted Stock
o Size of Stock Grant is Based on
Company Performance
o Reduces Company's Stock Usage Rate
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GENERAL MILLS