EXHIBIT 10.4
AMENDED AND RESTATED
GENERAL MILLS, INC.
EXECUTIVE INCENTIVE PLAN
JUNE 1, 2001 AND AS AMENDED THROUGH MAY 17, 2002
AMENDED AND RESTATED
GENERAL MILLS, INC.
EXECUTIVE INCENTIVE PLAN
1. PURPOSE OF THE PLAN
The purpose of the General Mills, Inc., Executive Incentive Plan (the
"Plan") is to provide financial rewards to key executives of General
Mills, Inc. ("General Mills"), its subsidiaries and affiliates (defined
as entities in which General Mills, Inc., has a significant equity or
other interest) (collectively with General Mills, the "Company") in
recognition of their contributions to the success of the Company, and
to align the interests of such executives with the interests of the
stockholders of the Company.
2. EFFECTIVE DATE
This Plan, as amended and restated herein, shall become effective as of
September 25, 2000, subject to the approval of the stockholders of
General Mills at the Annual Meeting of Stockholders on that date. This
Plan is a successor to and replaces the Executive Incentive Plan,
amended and approved by stockholders on September 30, 1996. Definitions
used in the Plan can be found in Section 16.
3. ELIGIBLE PERSONS
All officers of the Company shall be "Participants" eligible to receive
Awards under the Plan.
4. AWARD TYPE
Under this Plan, the Committee may award Participants Cash Bonuses and
the right to receive shares of Common Stock subject to certain
restrictions ("Restricted Stock" or "Restricted Stock Units"). Cash
bonuses, Restricted Stock and Restricted Stock Units are sometimes
referred to as "Awards."
5. AWARDS OF CASH BONUSES, RESTRICTED STOCK and restricted stock UNITS
(a) Performance Goal. In order for any Participant to receive an
Award for a Performance Period, the Net Earnings of the
Company must be greater than zero.
(b) Grants. At the end of the Performance Period, if the Committee
certifies that the requirement of Section 5(a) has been met,
each Participant shall be deemed to have earned Awards equal
in value to the Maximum Amount, or such lesser amount as the
Committee shall determine in its discretion to be appropriate.
Such Awards
shall consist of Cash Bonuses, Restricted Stock or Restricted
Stock Units, or a combination thereof, as determined by the
Committee, subject to the limitation that Restricted Stock and
Restricted Stock Units may not constitute more than 50 percent
of each Participant's Award. The Committee, in its discretion,
may require, as a condition to the grant of Restricted Stock
or Restricted Stock Units, the purchase and deposit of Common
Stock owned by the Participant receiving such grant and the
forfeiture of such grant if such deposit is not made or
maintained during a required holding period. Such shares of
deposited Common Stock may not be otherwise sold or disposed
of during the applicable holding period. For purpose of
computing the value of Awards, each Restricted Stock or
Restricted Stock Unit shall be deemed to have a value
equivalent to the Fair Market Value of one share of Common
Stock on the Grant Date.
(c) Delivery of Awards. As soon as practicable following the end
of the Performance Period, the Company shall cause Common
Stock to be issued on an unrestricted basis in respect of
Restricted Stock and all Restricted Stock Units earned by a
Participant and shall pay each Participant all Cash Bonuses
earned by the Participant, except to the extent the
Participant elects to defer receipt of such Restricted Stock,
Restricted Stock Units or Cash Bonuses pursuant to the General
Mills, Inc., Deferred Compensation Plan.
(d) Maximum Amount. Notwithstanding any other provision of this
Plan, in no event shall the total Awards value earned by any
Participant for any one Performance Period exceed 0.5 percent
of the Company's Net Earnings for that Performance Period
(such amount, the "Maximum Amount").
(e) Profit Sharing Resolution. All awards under this Plan shall be
subject to General Mills' 1933 Shareholder Resolution on
Profit Sharing, as amended.
6. RESTRICTED STOCK AND RESTRICTED STOCK UNITS
(a) Vesting. Subject to the provisions of Sections 10 and 11, the
Vesting Date for Restricted Stock and Restricted Stock Units
shall be a date set forth in the applicable Grant Agreement
but which may not be earlier than 180 days after the
applicable Grant Date. The period between the applicable Grant
Date and the Vesting Date is referred to as the "Restricted
Period."
(b) Common Stock Issuance. As soon as reasonably practicable after
the Vesting Date for a Grant, General Mills shall issue to the
Participant a number of shares of Common Stock equal to the
number of shares of Restricted Stock or Restricted Stock Units
that vested on such Vesting Date, except to the extent the
Participant has elected to defer receipt of the Common Stock
pursuant to the General Mills, Inc., Deferred Compensation
Plan.
(c) Dividends and Cash Dividend Equivalents. Subject to the
restrictions set forth in Section 5(b), each Participant who
receives Restricted Stock shall have all rights as
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a Stockholder with respect to such shares, including the right
to vote the shares and receive dividends and other
distributions. A Participant who is credited with Restricted
Stock Units shall have no rights as a stockholder with respect
to such Restricted Stock Units until such time as share
certificates for Common Stock are issued to the Participant.
During the Restricted Period, however, the Company shall pay
to the Participant, on a quarterly basis, an amount (the "Cash
Dividend Equivalent") equal to the sum of all cash dividends
declared by General Mills with record dates during the prior
quarter with respect to that number of shares of Common Stock
equivalent to the number of Restricted Stock Units credited to
the Participant's Restricted Stock Units Account as of the
applicable record date.
(d) Grant Agreement. Each Grant shall be confirmed by, and be
subject to, the terms of an applicable Grant Agreement.
7. COMMON STOCK
(a) Adjustments for Corporate Transactions. The Committee may
determine that a corporate transaction has occurred affecting
the Common Stock such that an adjustment or adjustments to
outstanding shares of Restricted Stock or Restricted Stock
Units is required to preserve (or prevent enlargement of) the
benefits or potential benefits intended at the time of grant.
For this purpose, a corporate transaction includes, but is not
limited to, any noncash dividend or other noncash distribution
(whether in the form of Common Stock, securities of a
subsidiary of the Company, other securities or other
property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Common Stock or other
securities of the Company, issuance of warrants or other
rights to purchase Common Stock or other securities of the
Company, or any other similar corporate transaction. In the
event of such a corporate transaction, the Committee may, in
such manner as it deems equitable, adjust the number and kinds
of shares represented by outstanding Restricted Stock and
Restricted Stock Units.
(b) Limits on Distribution. Notwithstanding any other provision of
the Plan, the Company shall have no obligation to deliver any
shares of Common Stock under the Plan unless all of the
following conditions have been fulfilled:
(i) Listing or approval for listing upon notice of
issuance, of such shares on the New York Stock
Exchange; or such other securities exchange as may at
the time be the principal market for the Common
Stock, if applicable;
(ii) Any registration or other qualification of such
shares of General Mills under any state or federal
law or regulation, or the maintaining in effect of
any such registration or other qualification that the
Committee shall, in its absolute discretion upon the
advice of counsel, deem necessary or advisable; and
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(iii) Obtaining any other consent, approval or permit from
any state, federal or foreign governmental agency
which the Committee shall, in its absolute discretion
after receiving the advice of counsel, determine to
be necessary or advisable.
(c) Noncertificated Issuance of Shares. To the extent that the
Plan provides for issuance of stock certificates to reflect
the issuance of shares of Common Stock or Restricted Stock,
the issuance may be effected on a noncertificated basis, to
the extent not prohibited by applicable law or the applicable
rules of any stock exchange.
8. TRANSFERABILITY OF GRANTS
Except as otherwise provided by rules of the Committee, shares of
Restricted Stock, Restricted Stock Units and other rights of
Participants under this Plan shall not be transferable by a Participant
otherwise than by (i) the Participant's last will and testament or (ii)
by the applicable laws of descent and distribution.
9. TAXES
Whenever General Mills issues Common Stock under the Plan, the Company
may require the recipient to remit to the Company an amount sufficient
to satisfy any federal, state or local tax withholding requirements
prior to the delivery of such Common Stock, or, in the discretion of
the Committee, upon the election of the Participant, the Company may
withhold from the cash payments and shares to be delivered cash and
shares, respectively, sufficient to satisfy all or a portion of such
tax-withholding requirements.
10. CHANGE OF CONTROL
(a) Upon a Change of Control:
(i) All shares of Restricted Stock and Restricted Stock
Units shall immediately vest and Common Stock free of
restrictions shall be distributed to Participants,
effective as of the date of the Change of Control,
and
(ii) The Committee may make such additional adjustments
and/or settlements of outstanding Grants for the
Performance Period within which the Change of Control
occurs as it deems appropriate and consistent with
the Plan's purposes.
(b) "Change of Control" means the occurrence of any of the
following events:
(i) The acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2)
of the 1934 Act), (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3
promulgated under the 1934 Act) of voting securities
of General Mills where such acquisition causes
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such Person to own 20 percent or more of the combined
voting power of the then outstanding voting
securities of General Mills entitled to vote
generally in the election of directors (the
"Outstanding Voting Securities"); provided, however,
that for purposes of this subsection (i), the
following acquisitions shall not be deemed to result
in a Change of Control: (w) any acquisition directly
from General Mills, (x) any acquisition by the
Company, (y) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by
General Mills or any corporation controlled by
General Mills or (z) any acquisition by any
corporation pursuant to a transaction that complies
with clauses (x), (y) and (z) of subsection (iii)
below; and provided, further, that if any Person's
beneficial ownership of the Outstanding Voting
Securities reaches or exceeds 20 percent as a result
of a transaction described in clause (w) or (x)
above, and such Person subsequently acquires
beneficial ownership of additional voting securities
of General Mills, such subsequent acquisition shall
be treated as an acquisition that causes such Person
to own 20 percent or more of the Outstanding Voting
Securities; or
(ii) Individuals who, as of the date hereof, constitute
the Board (the "Incumbent Board") cease for any
reason to constitute at least a majority of the
Board, provided, however, that any individual
becoming a director subsequent to the date hereof
whose election, or nomination for election by the
shareholders of General Mills, was approved by a vote
of at least a majority of the directors then
comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs
as a result of an actual or threatened election
contest with respect to the election or removal of
directors or other actual or threatened solicitation
of proxies or consents by or on behalf of a Person
other than the Board; or
(iii) The approval by the shareholders of General Mills of
a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the
assets of General Mills ("Business Combination") or,
if consummation of such Business Combination is
subject, at the time of such approval by
stockholders, to the consent of any government or
governmental agency, the obtaining of such consent
(either explicitly or implicitly by consummation);
excluding, however, such a Business Combination
pursuant to which (x) all or substantially all of the
individuals and entities who were the beneficial
owners of the Outstanding Voting Securities
immediately prior to such Business Combination
beneficially own, directly or indirectly, more than
60 percent of, respectively, the then outstanding
shares of common stock and the combined voting power
of the then outstanding voting securities entitled to
vote generally in the election of directors, as the
case may be, of the corporation resulting from such
Business Combination (including, without
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limitation, a corporation that as a result of such
transaction owns General Mills or all or
substantially all of the assets of General Mills
either directly or through one or more subsidiaries)
in substantially the same proportions as their
ownership, immediately prior to such Business
Combination of the Outstanding Voting Securities, (y)
no Person (excluding any employee benefit plan, or
related trust, of General Mills or such corporation
resulting from such Business Combination)
beneficially owns, directly or indirectly, 20 percent
or more of, respectively, the then outstanding shares
of common stock of the corporation resulting from
such Business Combination or the combined voting
power of the then outstanding voting securities of
such corporation, except to the extent that such
ownership existed prior to the Business Combination
and (z) at least a majority of the members of the
board of directors of the corporation resulting from
such Business Combination were members of the
Incumbent Board at the time of the execution of the
initial agreement, or of the action of the Board,
providing for such Business Combination; or
(iv) Approval by the stockholders of General Mills of a
complete liquidation or dissolution of General Mills.
11. TERMINATION OF EMPLOYMENT
The following rules regarding the effect of a Participant's termination
of employment on his or her Restricted Stock or Restricted Stock Units
shall apply unless otherwise determined by the Committee.
(a) If the Participant's employment by the Company is terminated
by either:
(i) the voluntary resignation of the Participant or
(ii) a Company discharge due to Participant's illegal
activities, poor work performance, misconduct or
violation of the Company's policies or practices,
the Participant's shares of Restricted Stock or Restricted
Stock Units, which are unvested on the date of termination,
shall be forfeited.
(b) If the Participant's employment by the Company is terminated
for any reason other than specified in Section 11(a), (c), (d)
or (e), the following rules shall apply:
(i) In the event that, at the time of such termination,
the sum of Participant's age and service with the
Company equals or exceeds 70, the Participant's
Restricted Stock and Restricted Stock Units shall
continue to vest according to the schedule
established at the time of grant, unless otherwise
provided in the Grant Agreement.
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In the event that, at the time of termination, the
sum of Participant's age and service with the Company is less
than 70, Restricted Stock and Restricted Stock Units shall
vest in a pro-rata amount based on full months of employment
completed during the Restricted Period from the date of grant
to termination, and the Participant's remaining Restricted
Stock and Restricted Stock Units shall be forfeited; except if
the Participant is an executive officer of the Company, all
Restricted Stock and Restricted Stock Units shall fully vest
as of the date of termination.
(c) Death. A Participant who dies during the Restricted Period for
any Restricted Stock or Restricted Stock Units granted on or
after June 1, 2002 shall fully vest in such shares of
Restricted Stock or Restricted Stock Units, effective as of
the date of death. A Participant who dies during the
Restricted Period, for any Restricted Stock or Restricted
Stock Units granted prior to June 1, 2002, shall vest in a
proportionate number of such shares of Restricted Stock or
Restricted Stock Units, effective as of the date of death.
Such proportionate vesting shall be pro-rata, based on the
number of full months of employment completed during the
Restricted Period prior to the date of death, as a percentage
of the applicable Restricted Period.
(d) Retirement. The Committee shall determine, at the time of a
Grant, the treatment of the Restricted Stock or Restricted
Stock Units upon the retirement of the Participant during the
Restricted Period. Unless other terms are specified in the
original Grant or the Grant Agreement, if the termination of
employment is due to a Participant's retirement on or after
age 55, the Participant shall fully vest in all Restricted
Stock or Restricted Stock Units effective as of the date of
retirement.
(e) Spin-offs. If the termination of employment during the
Restricted Period for any Restricted Stock or Restricted Stock
Units is due to the cessation, transfer or spin-off of a
complete line of business of the Company, the Committee, in
its sole discretion, shall determine the treatment of such
Restricted Stock and Restricted Stock Units.
12. ADMINISTRATION OF THE PLAN
(a) Administration. The authority to control and manage the
operations and administration of the Plan shall be vested in
the Committee in accordance with this Section 12, subject to
the following:
(i) Subject to the provisions of the Plan, the Committee
shall have the authority and discretion to select
from among the eligible Company employees those
persons who shall receive Awards, to determine the
time or times of receipt, to determine the types of
Awards and the Target Amounts covered by the grants,
to establish the terms, conditions, restrictions, and
other provisions of such Grants, and (subject to the
restrictions imposed by Section 13) to cancel or
suspend Grants. In making such determinations, the
Committee may take into account the
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nature of services rendered by the individual, the
individual's present and potential contribution to
the Company's success and such other factors as the
Committee deems relevant.
(ii) The Committee shall have the authority and discretion
to establish terms and conditions of Awards as the
Committee determines to be necessary or appropriate
to conform to applicable requirements or practices of
jurisdictions outside the United States.
(iii) The Committee shall have the authority and discretion
to interpret the Plan, to establish, amend and
rescind any rules and regulations relating to the
Plan, to determine the terms and provisions of any
agreements made pursuant to the Plan, and to make all
other determinations that may be necessary or
advisable for the administration of the Plan.
(iv) Any interpretation of the Plan by the Committee and
any decision made by it under the Plan shall be final
and binding.
(b) Delegation by Committee. Except to the extent prohibited by
applicable law or the applicable rules of a stock exchange,
the Committee may delegate all or any portion of its
responsibilities and powers to any one or more of its members
and may delegate all or any part of its responsibilities and
powers to any person or persons selected by it. Any such
allocation or delegation may be revoked by the Committee at
any time.
13. AMENDMENTS OF THE PLAN
The Committee may from time to time prescribe, amend and rescind rules
and regulations relating to the Plan. Subject to the approval of the
Board, where required, the Committee may at any time terminate, amend
or suspend the operation of the Plan, provided that no action shall be
taken by the Board or the Committee without the approval of the
stockholders of General Mills which would amend the Maximum Amount, set
forth in Section 5(d), that may be granted to any single Participant.
No termination, modification, suspension or amendment of the Plan shall
alter or impair the rights of any Participant pursuant to an
outstanding Grant without the consent of the Participant. There is no
obligation for uniformity of treatment of Participants under the Plan.
14. FOREIGN JURISDICTIONS
It is intended that in lieu of awarding Restricted Stock, the Committee
may grant Restricted Stock Units to employees of the Company who are
subject to the laws of foreign jurisdictions and entitled to receive
Awards under the Plan. In addition, the Committee may adopt, amend and
terminate arrangements, not inconsistent with the intent of the Plan,
as it may deem necessary or desirable to make available tax or other
benefits of the laws of any foreign jurisdiction, to employees of the
Company who are subject to such laws and who receive Grants under the
Plan.
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15. NOTICE
All notices to the Company regarding the Plan shall be in writing,
effective as of actual receipt by the Company, and shall be sent to:
General Mills, Inc.
Number One General Mills Boulevard
Minneapolis, Minnesota 55426
Attention: Corporate Compensation
16. DEFINITIONS
For purposes of this Plan, the following terms shall have the meanings
set forth below.
"1934 ACT" means the Securities Exchange Act of 1934.
"AWARD" is defined in Section 4.
"BOARD" means the Board of Directors of General Mills.
"BUSINESS COMBINATION" is defined in Section 10(b)(iii).
"CASH DIVIDEND EQUIVALENT" is defined in Section 6(c).
"CHANGE OF CONTROL" is defined in Section 10(b).
"COMMITTEE" means the Compensation Committee of the Board, or such
other committee as the Board may from time to time select, provided
that the Committee must at all times be composed of two or more members
of the Board, each of whom qualifies as an "outside director" within
the meaning of Section 162(m) of the Internal Revenue Code of 1986, as
amended.
"CASH BONUSES" means cash payments to Participants under this Plan.
"COMMON STOCK" means the common stock, par value $0.10 per share, of
General Mills.
"COMPANY" is defined in Section 1.
"FAIR MARKET VALUE" of a share of Common Stock as of any given date
means, except as otherwise determined by the Committee, the mean of the
highest and lowest reported sales prices during regular trading hours
on that date (or, if there are no such reported sales on that date, on
the last date prior to such date on which there were such sales) of the
Common Stock on the New York Stock Exchange.
"GENERAL MILLS" is defined in Section 1.
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"GRANT" means a grant to an eligible employee of the opportunity to
earn Awards under this Plan for any Performance Period pursuant to
Section 5(b), including the awarding of Restricted Stock and crediting
of Restricted Stock Units to a Restricted Stock Units Account.
"GRANT AGREEMENT" is defined in Section 6(d).
"GRANT DATE" is the first business day after the end of the applicable
Performance Period.
"INCUMBENT BOARD" is defined in Section 10(b)(ii).
"MAXIMUM AMOUNT" is defined in Section 5(d).
"NET EARNINGS" means the Company's earnings from continuing operations
before unusual items and after taxes.
"OUTSTANDING VOTING SECURITIES" is defined in Section 10(b)(i).
"PARTICIPANT" is defined in Section 3.
"PERFORMANCE PERIOD" means a fiscal year of the Company, or such other
period as the Committee may from time to time establish.
"PERSON" is defined in Section 10(b)(i).
"PLAN" is defined in Section 1.
"RESTRICTED PERIOD" is defined in Section 6(a).
"RESTRICTED STOCK" is defined in Section 4.
"RESTRICTED STOCK UNIT" IS DEFINED IN SECTION 4.
"VESTING DATE" means the date on which Restricted Stock or Restricted
Stock Units vest, pursuant to Sections 6, 10, or 11.
Effective September 25, 2000
Amended June 1, 2001
Amended May 17, 2002
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