GENERAL MILLS INC - DEF 14A - 20020815 - AUDIT_COMMITTEE
REPORT OF THE AUDIT COMMITTEE
THE COMMITTEE. The Audit Committee of the Board of Directors consists of five
non-employee directors, who are independent directors as defined by New York
Stock Exchange listing standards. The Committee is primarily responsible for
oversight of the Company's financial reporting process, assessing and ensuring
the independence of the independent auditor, reviewing the Company's risk
assessment process and compliance program and reviewing and approving the annual
audited financial statements for the Company before issuance, subject to Board
of Directors approval.
REVISION OF AUDIT COMMITTEE CHARTER. In June 2002, the Audit Committee of the
Board of Directors revised its Charter and recommended its approval by the full
Board of Directors. The revised Charter, attached as Exhibit A to this Proxy
Statement, sets forth the Audit Committee's principal accountabilities,
including recommending the independent auditor for approval by the Board of
Directors and approving the services to be provided by the independent auditor.
COMMITTEE REPORT. The following is the report of the Audit Committee with
respect to the Company's audited financial statements for fiscal year ended May
26, 2002.
The Committee has reviewed and discussed the Company's audited financial
statements with management, the internal auditors and KPMG LLP, the Company's
independent auditors, with and without management present. The Committee
included in their review results of the auditors' examinations, the Company's
internal controls and the quality of the Company's financial reporting. The
Committee is satisfied that the internal control system is adequate and that the
Company employs appropriate accounting and auditing procedures.
The Committee has also discussed with KPMG LLP matters relating to the auditors'
judgments about the quality, as well as the acceptability, of the Company's
accounting principles, as applied in its financial reporting as required by
Statement of Auditing Standards No. 61, Communications with Audit Committees. In
addition, the Committee has discussed with KPMG their independence from
management and the Company, as well as the matters in the written disclosures
received from its independent auditors and required by Independence Standards
Board Standard No. 1, Independence Discussions with Audit Committees. The
discussions included review of the scope of KPMG's audits and all fees paid to
KPMG during the fiscal year. The Committee has reviewed and considered the
compatibility of KPMG's performance of non-audit services with the maintenance
of KPMG's independence as the Company's independent auditor.
Based on the Committee's review and discussions referred to above, the Committee
recommended to the Company's Board of Directors that the Company's audited
financial statements be included in the Company's Annual Report on Form 10-K for
the fiscal year ended May 26, 2002 for filing with the Securities and Exchange
Commission.
SUBMITTED BY THE AUDIT COMMITTEE:
A. Michael Spence, Chair
Livio D. DeSimone
Raymond V. Gilmartin
Robert L. Johnson
Dorothy A. Terrell
19
STOCKHOLDER PROPOSAL ON GENETIC
ENGINEERING IN FOOD PRODUCTS
Item No. 3 (see page 5) asks the stockholders to consider a proposal of the
Camilla Madden Charitable Trust, c/o Adrian Dominican Sisters, 1257 East Siena
Heights Drive, Adrian, MI 49221-1793, owners of 62,500 shares, Joan Inman, c/o
Harrington Investments, Inc., 1001 Second Street, Suite 325, Napa, CA 94559,
owner of 400 shares, Trinity Health, 29000 Eleven Mile Road, Farmington Hills,
MI 48336, owners of 7,700 shares, the Charitable Trust of the Sisters of Mercy
Regional Community of Detroit, 29000 Eleven Mile Road, Farmington Hills, MI
48336, owners of 900 shares, and the Sisters of St. Joseph of Nazareth, 3427
Gull Road, P.O. Box 13, Nazareth, MI 49074, owners of 100 shares, who have
notified the Company in writing that they intend to present the following
resolution at the annual meeting.
"RESOLVED: Shareholders request that (unless long-term safety testing
demonstrates that genetically engineered (GE) crops, organisms, or products
thereof are not harmful to humans, animals, and the environment) the Board of
Directors adopt a policy to identify and label all food products manufactured or
sold by the company under the company's brand names or private labels that may
contain GE ingredients."
SUPPORTING STATEMENT
International markets for genetically engineered (GE) foods are threatened by
extensive resistance:
* Many of Europe's larger food retailers have committed to removing GE
ingredients from their store-brand products, as have some U.S.
retailers;
* In the UK, three fast-food giants -- McDonald's, Burger King, and KFC
-- are eliminating GE soy and corn ingredients from their menus;
* McCain Foods of Canada announced it would no longer accept genetically
engineered Bt potatoes for their brand-name products (11/99);
* Gerber Products Co. announced in July 1999 that it would not allow GE
corn or soybeans in any of their baby foods;
* Frito Lay, a division of Pepsico, asked farmers that supply corn for
Frito Lay to provide only non-genetically engineered corn;
* Since fall of 2000, hundreds of millions of dollars may have been
spent by food companies in recalling food containing GE corn not
approved for human consumption;
* Upon ratification by 50 countries, the Biosafety Protocol, signed by
over 100 countries, will require that genetically engineered organisms
(GEOs) intended for food, feed and processing must be labeled "may
contain" GEOs, and countries can decide whether to import those
commodities based on a scientific risk assessment.
There is scientific concern that genetically engineered agricultural products
may be harmful to humans, animals, or the environment:
* For human health and environmental concerns, the European Union has
proposed regulations to phase out by 2005 antibiotic-resistant marker
genes, widely used to develop GE seeds;
* Research has shown that Bt crops are building up Bt toxins in the soil
with unknown long-term effects on soil ecology;
* The National Academy of Sciences report, Genetically Modified
Pest-Protected Plants, recommends development of improved methods for
identifying potential allergens in genetically engineered
pest-protected plants. The report found the potential for gaps in
regulatory coverage (4/2000);
* GE-crops grown for pharmaceutical purposes, including contraceptive
effects, may contaminate other crops and soil and adversely effect
human health;
* Uncertainty about the ecological risks of genetically engineered crops
persists. (Science 12/15/2000);
20
In the U.S., a long tradition of citizens' "right to know" is expressed in laws
requiring nutritional labeling of foods:
* Focus groups conducted by the Food and Drug Administration in spring
2000 indicated strong public support for mandatory labeling;
* Over a dozen polls in the U.S. show that about 70-93% of people
surveyed want GE food to be labeled as such;
* It is difficult for individuals to avoid GE-foods for religious or
ethical reasons unless they are labeled;
* The European Union, Japan, New Zealand, South Korea and Australia have
passed regulations that require labeling of GE-foods."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST THE PROPOSAL
ON LABELING GENETICALLY ENGINEERED FOOD PRODUCTS FOR THE FOLLOWING REASONS:
Modern biotechnology holds much promise for society, for consumers and for the
world. It is already being used in agriculture to reduce the use of chemical
pesticides and for low-impact, low-tillage farming. It is viewed by some
organizations dedicated to alleviating Third World food and nutrition deficits,
such as the Rockefeller Foundation and the Food and Agricultural Organization of
the United Nations, as a potentially important tool in meeting the world's food
needs. And it has the clear potential to foster the development of food products
that confer additional health and nutrition benefits on consumers.
It is a fundamental commitment of General Mills that every food product we make
and sell is safe for human consumption. The U.S. Food and Drug Administration,
the Department of Agriculture and the Environmental Protection Agency have each
determined that food containing ingredients improved through modern
biotechnology is safe and is no different in any meaningful way from other
foods. The National Academy of Science has reached the same conclusion on three
occasions, and so have the national academies of several other countries and the
American Medical Association. There is no evidence of any harm related to the
inclusion of genetically engineered ingredients in food products.
The proposal asks the Company to `identify and label all products manufactured
or sold by General Mills under the company's brand names or private labels that
may contain genetically engineered ingredients.' It should be noted that the FDA
already requires labeling of products containing genetically engineered
ingredients whenever such ingredients change the nutritional composition of the
product or are allergenic. In January 2001, the FDA issued proposed voluntary
guidelines, which continue to add clarity to the FDA's labeling requirements
already in place for products of modern biotechnology. We support these labeling
policies. We also support the FDA's move to make mandatory its review of all
bioengineered ingredients. And we support the agency's initiatives to resolve
issues uniformly and take whatever steps are necessary to continue to assure
that any new food technology is safe for consumers and the environment based on
a comprehensive, balanced evaluation and sound science.
It is worth noting that the FDA is concerned that special labeling for foods
containing ingredients improved through modern biotechnology may be misleading
to consumers because many would interpret such a label as a warning when, in
fact, there is no scientific basis to suggest that such foods are in any
meaningful way different from their non-biotech counterparts. There is also the
practical difficulty of successfully segregating biotech from non-biotech crops
in North America. Instituting such a system would be very costly and result in
higher prices to consumers for no apparent benefit.
Similar proposals have been presented to General Mills shareholders in both 2000
and 2001. Each time, the proposal was soundly defeated, receiving less than a
10% favorable vote.
21
STOCKHOLDER PROPOSAL ON
GLOBAL WORKERS RIGHTS STANDARDS
Item No. 4 (see page 6) asks the stockholders to consider a proposal of the
Comptroller of the City of New York, as custodian and/or trustee of the New York
City Employees Retirement System (NYCERS), the New York City Teachers Retirement
System, the New York City Fire Department Pension Fund and the New York City
Police Pension Fund, 1 Centre Street, New York, NY 10007-2341, owners of 877,580
shares, who has notified the Company in writing that these funds intend to
present the following resolution at the annual meeting:
"Whereas, General Mills, Inc. currently has extensive overseas operations, and
Whereas, reports of human rights abuses in the overseas subsidiaries and
suppliers of some U.S.-based corporations has lead to an increased
public awareness of the problems of child labor, "sweatshop"
conditions, and the denial of labor rights in U.S. corporate overseas
operations, and
Whereas, corporate violations of human rights in these overseas operations can
lead to negative publicity, public protests, and a loss of consumer
confidence which can have a negative impact on shareholder value, and
Whereas, a number of corporations have implemented independent monitoring
programs with respected human rights and religious organizations to
strengthen compliance with international human rights norms in
subsidiary and supplier factories, and
Whereas, these programs incorporate the core conventions of the United Nations'
International Labor Organization (ILO) on workplace human rights which
include the following principles:
1) All workers have the right to form and join trade unions and to
bargain collectively. (ILO Conventions 87 and 98)
2) Workers representatives shall not be the subject of discrimination
and shall have access to all workplaces necessary to enable them to
carry out their representation functions. (ILO Convention 135)
3) There shall be no discrimination or intimidation in employment.
Equality of opportunity and treatment shall be provided regardless
of race, color, sex, religion, political opinion, age, nationality,
social origin, or other distinguishing characteristics. (ILO
Convention 100 and 111)
4) Employment shall be freely chosen. There shall be no use of force,
including bonded or prison labor. (ILO Conventions 29 and 105)
5) There shall be no use of child labor. (ILO Convention 138), and,
Whereas, independent monitoring of corporate adherence to these principles is
essential if consumer and investor confidence in our company's
commitment to human rights is to be maintained,
Therefore, be it resolved that shareholders request that the company commit
itself to the implementation of a code of corporate conduct based on the
aforementioned ILO human rights Conventions by its international suppliers and
in its own international production facilities and commit to a program of
outside, independent monitoring of compliance with these standards."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE AGAINST THE PROPOSAL
ON GLOBAL WORKERS RIGHTS STANDARDS FOR THE FOLLOWING REASONS:
General Mills strongly supports human rights in the workplace, and our corporate
policies and practices specifically address the matters raised in this proposal.
These corporate policies make clear our commitment to ethical business conduct
and worker human rights in every aspect of our business and in every location
where we operate. Our policies require that our facilities and those of our
vendors, licensees and contract manufacturers not use forced or prison labor of
any kind or any form of physical abuse. Our facilities and those we do business
with must comply with applicable wage and hour laws. Our policies prohibit the
use of child labor. We strongly believe that no employer should unlawfully
22
discriminate against anyone and we are committed to operating within the spirit
and letter of all laws and regulations affecting our businesses and employees.
We regularly distribute our corporate policies to ensure that our employees
understand our values, and we annually ask a wide range of management and
professional employees to certify their compliance with key policies, to notify
us of any breach or potential for breach, and to ensure that the policies are
discussed with the people who work for them.
General Mills monitors compliance with its workplace corporate policies through
regular reviews of supplier and owned facilities. Where risks of non-compliance
are greatest, regular audits are conducted by third party compliance auditors or
by specifically trained General Mills employees.
General Mills has a long history of being recognized for our commitment to
corporate social responsibility, fairness and diversity. For example, in the
last three years we have received the Catalyst Award, for support of women in
the workplace, the Ron Brown Award for Corporate Leadership, FORTUNE magazine
has named us one of America's Most Admired Companies, and Business Ethics, the
Corporate Responsibility Report, has placed us on the list of 100 Best Corporate
Citizens. In addition, we have received the Council on Economic Priorities'
Corporate Conscience Award four times in the last several years.
Because of our existing policies addressing issues identified in the proposal,
and our ongoing monitoring of compliance with those policies, we do not believe
that adoption of this proposal is necessary or in the best interest of
shareholders.
23
TOTAL RETURN TO STOCKHOLDERS
This line graph and table compare the cumulative total stockholder return for
holders of General Mills common stock with the cumulative total return of the
Standard & Poor's 500 Stock Index and the Standard & Poor's Food Products Index
for the last five-year period. The graph and table assume the investment of $100
in each of General Mills' common stock and the specified indexes at the
beginning of the applicable period, and assume the reinvestment of all
dividends.
[PLOT POINTS CHART]
----------------------------------------------------------
MAY 97 MAY 98 MAY 99 MAY 00 MAY 01 MAY 02
--------------------------------------------------------------------------------
General Mills 100 110 133 140 148 162
--------------------------------------------------------------------------------
S&P Food Products 100 134 119 108 125 144
--------------------------------------------------------------------------------
S&P 500 100 131 158 175 156 135
--------------------------------------------------------------------------------
24
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
THE COMMITTEE'S RESPONSIBILITIES
The Compensation Committee of the Board (the "Committee") is responsible for
setting and administering the policies that govern executive compensation. The
Committee is composed entirely of independent, non-employee directors. Reports
of the Committee's actions and recommendations are presented to the full Board.
The purpose of this report is to summarize the philosophical principles,
specific program elements and other factors considered by the Committee in
making decisions about executive compensation.
COMPENSATION PHILOSOPHY
The Committee bases its compensation decisions on the following core principles:
* Pay is performance-based. Base salaries at General Mills are generally
lower than those at comparable companies in the food and consumer products
business sector, but they are coupled with an incentive system that pays
more with good performance and less for below-par performance.
* Stock ownership is emphasized. The Committee believes that broad and deep
employee stock ownership effectively aligns the interests of employees with
those of stockholders and provides a strong motivation to build stockholder
value. The Company has established specific stock ownership objectives for
key management employees and programs have been created that encourage all
employees, particularly key management employees, to have an ownership
interest in the Company.
* Compensation opportunities must be competitive to attract and retain
talented employees. The Committee evaluates Company performance, actual
compensation and share ownership, and compares them with data for peer food
and consumer product companies as well as a broader group of leading
industrial companies.
PROGRAM ELEMENTS
General Mills' executive compensation program comprises base salary, annual
incentive and long-term incentive compensation.
BASE SALARY. Base salaries for officers are generally lower than at comparable
companies due to our emphasis on performance-oriented incentive compensation and
because historically many of our executives received stock options in lieu of
salary increases under the Salary Replacement Stock Option Plan. All salaried
employees, including executives, are eligible for an annual merit increase to
base salary based primarily on performance of job responsibilities and
accomplishment of predetermined performance objectives.
ANNUAL INCENTIVE. General Mills provides executives with an annual opportunity
to earn cash incentive awards through the Executive Incentive Plan (EIP). Under
the EIP, fiscal 2002 incentive amounts were determined by the Committee at the
end of the year based upon corporate, business unit and individual perfor-
mance. For each of the five most highly compensated officers, including the CEO,
this incentive amount was limited to a maximum amount established under the EIP,
and was adjusted downward from the maximum by the Compensation Committee
according to a schedule determined by the Committee at the start of the year.
In fiscal 2002, the schedule that established the year-end corporate performance
rating was weighted 50 percent to the Company's earnings-per-share performance
and 50 percent to key Pillsbury integration success and performance momentum
objectives. Key integration measurements included achievement of acquisition
financial synergies, integration of financial information systems and sales
organizations and completion of plant conversions for the businesses divested.
Although the Company successfully met all Pillsbury integration milestones,
fiscal 2002 earnings per share fell well short of goal. Accordingly, the
Committee assigned an incentive rating of 1.16 that is approximately 32 percent
below the fiscal 2001 rating and 25 percent below the average rating of the
prior five fiscal years.
Business unit ratings were based 75 percent on financial performance and 25
percent on the quality of this financial performance and progress against
strategic growth priorities. Unit financial performance was measured by earnings
before interest and taxes, volume, productivity improvements and/or
cost-per-case targets.
Individual performance ratings were based upon each executive's achievement of
specific annual
25
financial objectives as well as other factors like achievement of Pillsbury
integration milestones, the quality of business plans and strategies, progress
in organizational and management development and diversity.
For senior officers, cash incentive awards were determined by multiplying fiscal
year base salary by a base incentive rate (a percentage of salary that increases
with the level of responsibility), the individual performance rating and the
corporate performance rating. For officers in operating units, the corporate
rating was weighted with a business unit rating. The scale for corporate and
business unit ratings ranged from 0 to 1.80, with superior performance resulting
in ratings of 1.50 or higher. The scale for individual ratings ranged from 0 to
1.50. Executives were permitted to defer receipt of cash incentive awards earned
under the EIP to a subsequent date. Cash incentive awards are included in the
Summary Compensation Table on page 28 under the Bonus column.
Under the EIP, in fiscal 2002 executives also were eligible to receive a
supplemental restricted stock matching award equal to 30 percent of the cash EIP
award. This award can be adjusted up or down by up to 25 percent of the award
according to a schedule based on the corporate performance rating. To receive
the supplemental restricted stock award, the executive must place on deposit
with the Company personally owned shares equal in number to the number of shares
awarded as restricted stock. The restricted stock vests after four years,
provided the owned shares remain on deposit with the Company for the entire
four-year period. Restricted shares granted under the EIP are included in the
Summary Compensation Table on page 28 under the Restricted Stock Award(s)
column.
LONG-TERM INCENTIVE. General Mills provides executives with a long-term
incentive compensation opportunity through the 1998 Senior Management Stock
Plan. Each December, stock options are granted to officers and other selected
employees based upon their level of responsibility, ability to impact results
and individual performance. The size of regular stock option grants to the
executive officers, including the Chief Executive Officer, is periodically
reviewed against option grants made by other large food and consumer products
companies to their CEO and other senior executives. Our targeted level of stock
option grants ranks above the median range of option grants made by the
comparative organizations. The stock option grant can be adjusted up or down by
25 percent according to a schedule based on corporate performance rating.
The table on page 29 summarizes the options granted in fiscal 2002 to all
employees and to the five named officers. Also, we have periodically provided
special stock option grants to all employees not receiving regular stock option
grants. General Mills made such grants to eligible employees in fiscal years
1994, 1996, 2000 and 2002. These broad-based option awards are designed to
expand employee stock ownership and provide further motivation throughout the
Company to achieve corporate performance objectives. In special circumstances,
we make limited special grants of restricted stock to certain key employees.
Executives and selected employees were given an opportunity to exchange a
portion of their merit-related base salary increase for a supplemental stock
option grant through the Salary Replacement Stock Option Plan, which was
discontinued in September 2001. The size of the option grant is determined by
calculating the estimated present value of the foregone salary increase
(including pay-related compensation and benefits, such as annual incentive,
savings plan match and pension accrual) and dividing it by the estimated present
value of a stock option, assuming an 8 percent annual growth rate in the common
stock price. Approximately 1,107 employees participated in this program in
fiscal 2002, which was the last year of the program; the table on page 29
includes stock options granted under this program to the five named officers.
CEO COMPENSATION AND PERFORMANCE
The compensation of the Company's Chief Executive Officer for fiscal 2002
consisted of base salary, annual incentive and stock options. The Committee
determined the level for each of these elements using methods consistent with
those used for other senior executives. When determining the CEO's merit
increase to base salary, individual incentive award and annual stock option
grant, the Committee evaluates his performance and reports on that evaluation to
the independent directors of the Board. In determining Mr. Sanger's 2002
individual incentive award, the Committee's analysis began with the corporate
performance rating used to determine the annual incentive of other executive
officers. Then the Committee considered Mr. Sanger's personal performance
against pre-established objectives in numerous
26
areas, including Company financial performance, growth, innovation, productivity
improvement, new ventures, organizational development, diversity, and customer
and stockholder relations.
DEDUCTIBILITY OF EXECUTIVE COMPENSATION
The Internal Revenue Code requires that the Company meet specific criteria,
including stockholder approval of certain stock and incentive plans, in order to
deduct, for federal income tax purposes, compensation over $1 million paid to
the five officers named in the Proxy Statement. The Company expects to meet the
requirements of the Code and receive a deduction for all compensation paid to
those executive officers in fiscal 2002.
CONCLUSION
The Committee is satisfied that the compensation and long-term incentive plans
provided to the officers of the Company are structured and operated to create
strong alignment with the long-term best interests of the Company and its
stockholders.
SUBMITTED BY THE COMPENSATION
COMMITTEE:
Livio D. DeSimone, Chair
William T. Esrey
Raymond V. Gilmartin
Heidi G. Miller
A. Michael Spence
27
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION
ANNUAL COMPENSATION AWARDS
-------------------------------------------------------------- -------------------------
RESTRICTED
OTHER ANNUAL STOCK ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION AWARD(S) COMPENSATION
POSITION YEAR ($) ($) ($) ($) (a) OPTIONS (#) ($) (b)
--------------------------------- ---- ------- --------- ------------ ---------- ----------- ------------
S. W. SANGER 2002 784,462 941,044 65,252(c) 282,288 719,050 57,337
Chairman of the Board and 2001 696,150 1,261,100 97,102(c) 472,906 785,811 104,519
Chief Executive Officer 2000 696,150 1,264,600 -- 316,138 735,958 104,659
R. G. VIAULT 2002 593,604 511,339 -- 153,392 226,950 53,327
Vice Chairman 2001 550,000 701,300 -- 262,962 263,121 66,603
2000 533,334 753,825 -- --(d) 239,000 61,088
S. R. DEMERITT 2002 541,542 466,565 96,697(e) 139,969 221,350 32,392
Vice Chairman 2001 500,000 629,000 -- 235,836 266,073 50,728
2000 459,569 646,500 342,124(e) 161,557 208,418 135,614
J. A. LAWRENCE 2002 462,088 373,943 -- 112,174 171,050 24,699
Executive Vice President 2001 425,000 495,200 -- 185,671 183,121 45,450
and Chief Financial Officer 2000 425,000 478,800 -- 119,730 158,392 37,291
S. S. MARSHALL 2002 348,733 252,642 -- 75,792 104,400 34,543
Senior Vice President, Corporate 2001 320,000 315,500 -- 118,259 115,067 31,413
Affairs, General Counsel and 2000 315,522 307,000 -- 913,351(f) 107,304 33,934
Secretary
(a) The amounts in this column reflect the value of the restricted stock or
restricted stock units awarded annually under the Executive Incentive Plan
("EIP"), except as described in note (f). Recipients must deposit with the
Company one personally owned share of common stock for each share of
restricted stock awarded. The restricted stock granted in 2002 and 2001
vests in four years and the restricted stock granted in 2000 vests 50%
after three years and 50% after six years, in each case, provided the
participant's shares remain on deposit until the end of the restricted
period. Regular dividends are paid on the restricted stock. Restricted
stock under the EIP vests in the event of a change in control. At the end
of fiscal 2002, the number and value of the aggregate restricted
stockholdings for the named officers were:
S. W. Sanger 34,343 shares $1,547,838
R. G. Viault 15,257 687,633
S. R. Demeritt 15,112 681,099
J. A. Lawrence 22,416 1,010,289
S. S. Marshall 29,013 1,307,616
(b) The amounts for all officers, other than Mr. Demeritt, represent the
Company's matching contributions to retirement savings plans (tax-qualified
and supplemental) and, for certain officers, the Company's matching
allocations to the deferred compensation plan on behalf of the named
officers. Amount for Mr. Demeritt includes $92,249 in 2000 relating to his
foreign assignment at Cereal Partners Worldwide.
(c) This amount represents perquisites used by Mr. Sanger, including $40,635
for the personal use of the Company aircraft in 2002 and $73,658 in 2001.
(d) Because Mr. Viault's age exceeds 55, in lieu of his restricted stock award
he may elect to receive an additional cash amount equal to 15% of his
annual cash bonus. His additional cash amount is reflected in the Bonus
column.
(e) This amount represents reimbursements made to Mr. Demeritt for incremental
taxes resulting from his foreign assignment.
(f) This amount includes the value of a special restricted stock grant made to
Ms. Marshall. Regular dividends are paid on shares of restricted stock.
28
OPTION GRANTS IN LAST FISCAL YEAR
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS (a) FOR OPTION TERM ($) (b)
------------------------------------------------------------------------ -------------------------------------------------
% OF TOTAL
OPTIONS
OPTIONS GRANTED TO EXERCISE
GRANTED EMPLOYEES IN PRICE EXPIRATION
NAME (#) FISCAL YEAR ($/SHARE) DATE 0% ($) (c) 5% ($) 10% ($)
---------------- ---------- ------------ --------- ---------- ---------- -------------- --------------
Sanger 625,000(d) 4.29% 49.61 1/17/2012 0 19,697,185 50,031,525
94,050(e) 0.65% 43.79 9/1/2011 0 2,616,307 6,645,509
Viault 187,500(d) 1.29% 49.61 1/17/2012 0 5,909,155 15,009,458
39,450(e) 0.27% 43.79 9/1/2011 0 1,097,430 2,787,510
Demeritt 187,500(d) 1.29% 49.61 1/17/2012 0 5,909,155 15,009,458
33,850(e) 0.23% 43.79 9/1/2011 0 934,137 2,372,740
Lawrence 156,250(d) 1.07% 49.61 1/17/2012 0 4,924,296 12,507,881
14,800(e) 0.10% 43.79 9/1/2011 0 411,710 1,045,758
Marshall 93,750(d) 0.64% 49.61 1/17/2012 0 2,954,578 7,504,729
10,650(e) 0.07% 43.79 9/1/2011 0 296,264 752,522
All Stockholders NA NA NA NA 0 11,236,165,753(f) 28,540,246,955(f)
All Optionees 14,567,018 100% 48.17(g) (g) 0 445,761,149 1,132,248,629
As a % of All
Stockholders'
Potential Gain NA NA NA NA NA 4.0% 4.0%
(a) All options are granted at the fair market value of the common stock on the
grant date and generally expire 10 years and one month from the grant date.
All options become fully exercisable for a period of one year after a
change of control. Options include the right to pay the exercise price in
cash or previously acquired common stock and the right to have shares
withheld by the Company to pay withholding tax obligations due upon
exercise.
(b) These assumed values result from using certain rates of stock price
appreciation prescribed under Securities and Exchange Commission rules and
are not intended to forecast possible future appreciation in the Company's
common stock. The actual value of these option grants is dependent on
future performance of the common stock and overall stock market conditions.
There is no assurance that the values reflected in this table will be
achieved.
(c) No gain or benefit to the optionees is possible without stock price
appreciation, which will benefit all stockholders commensurately.
(d) This stock option grant under the 1998 Senior Management Stock Plan becomes
exercisable on December 17, 2005.
(e) Options granted under the 1995 Salary Replacement Stock Option Plan are
awarded in lieu of cash compensation to an executive. The option becomes
exercisable over a four-year period, beginning on the grant date. The Plan
was discontinued in September 2001.
(f) For All Stockholders, the potential gain is calculated using an exercise
price of $48.17, representing the weighted average exercise price for all
options awarded in fiscal 2002, and the total amount of outstanding common
stock on May 26, 2002. The potential gain is measured over an option term
of 10 years and one month.
(g) Exercise price shown is a weighted average of all options awarded in fiscal
2002. Options expire on various dates through the year 2012.
29
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES ACQUIRED VALUE OPTIONS AT 5/24/02 (#) OPTIONS AT 5/24/02 ($) (a)
ON EXERCISE REALIZED ----------------------------- -----------------------------
NAME (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- --------- ----------- ------------- ----------- -------------
Sanger 70,568 3,959,129 2,194,173 2,810,753 37,711,753 16,186,648
Viault 66,500 1,107,225 427,140 901,311 5,256,787 5,360,496
Demeritt 45,063 2,624,984 403,248 830,655 5,878,204 4,814,983
Lawrence 0 0 33,710 778,853 214,250 5,156,029
Marshall 0 0 281,512 432,623 4,699,097 2,531,414
(a) Value of unexercised options equals the fair market value of the shares
underlying in-the-money options at May 24, 2002 ($45.07), less the exercise
price, multiplied by the number of in-the-money options outstanding.
DEFINED BENEFIT RETIREMENT PLAN
FINAL AVERAGE EARNINGS 10 YEARS OF 15 YEARS OF 20 YEARS OF 25 YEARS OF 30 OR MORE YEARS OF
(AS DEFINED) SERVICE SERVICE SERVICE SERVICE SERVICE*
----------------------------------------------------------------------------------------------------------
$ 300,000 $ 50,000 $ 75,000 $100,000 $125,000 $ 150,000
500,000 83,333 125,000 166,666 208,333 250,000
600,000 100,000 150,000 200,000 250,000 300,000
700,000 116,666 175,000 233,333 291,666 350,000
800,000 133,333 200,000 266,666 333,333 400,000
900,000 150,000 225,000 300,000 375,000 450,000
1,000,000 166,666 250,000 333,333 416,666 500,000
1,100,000 183,333 275,000 366,666 458,333 550,000
1,200,000 200,000 300,000 400,000 500,000 600,000
1,300,000 216,666 325,000 433,333 541,666 650,000
1,400,000 233,333 350,000 466,666 583,333 700,000
1,500,000 250,000 375,000 500,000 625,000 750,000
1,600,000 266,666 400,000 533,333 666,666 800,000
1,700,000 283,333 425,000 566,666 708,333 850,000
1,800,000 300,000 450,000 600,000 750,000 900,000
1,900,000 316,666 475,000 633,333 791,666 950,000
2,000,000 333,333 500,000 666,666 833,333 1,000,000
2,100,000 350,000 525,000 700,000 875,000 1,050,000
*No additional benefits accrue after 30 years of service.
The preceding table sets forth the pension benefits payable under the Company's
tax-qualified Retirement Income Plan (the "RIP") and Supplemental Retirement
Plan to the persons named in the Summary Compensation Table (see page 28),
showing the estimated annual aggregate benefits payable at normal retirement
(age 65) for various classifications of earnings and years of benefit service.
Because federal law limits the benefits that may be paid from a tax-qualified
retirement plan like the RIP, the Supplemental Retirement Plan provides for the
payment of additional amounts to certain executive officers (including the
officers named in the Summary Compensation Table) so that they will receive, in
the aggregate, the benefits they would have been entitled to receive had the RIP
not been subject to such maximum limitations. This table is based on the maximum
benefit under the RIP of 50 percent of Final Average Earnings for a participant
with 30 years of benefit service, less 50 percent of the employee's projected
Social Security benefit. Final Average Earnings is the average of the employee's
five highest years' remuneration. Such remuneration generally equals the salary
and bonus reported in the Summary Compensation Table plus the value of vested
restricted stock and stock units granted under the EIP. The effects of
integration with Social Security benefits have been excluded from the table,
because the amount of the reduction in benefits due to integration varies
depending on the participant's age at the time of retirement and changes in the
Social Security laws.
The officers listed in the Summary Compensation Table are credited,
respectively, with the following full years of benefit service under the RIP:
S. W. Sanger, 28 years; R. G. Viault, 6 years; S. R. Demeritt, 32 years; J. A.
Lawrence, 3 years; and S. S. Marshall, 7 years.
30
In addition, the Company has agreed to provide supplemental retirement benefits
to R. G. Viault to compensate for the difference, if any, between the pension
benefit he would have received from his previous employer's retirement plan and
the benefit he receives from the combination of his previous employer's plan and
the Company's plans.
CHANGE OF CONTROL ARRANGEMENTS
The Company has agreements with some of its executive officers providing for
guaranteed severance payments equal to three times the annual compensation of
the officer (salary plus cash incentive award) and continuation of health and
similar benefits for a three-year period if the officer is terminated within two
years after a change of control. These agreements also provide for a cash
payment of the amount necessary to insure that the foregoing payments are not
subject to reduction due to the imposition of excise taxes payable under Code
Section 4999 or any similar tax.
The Company has two nominally funded trusts to provide for payments under its
nonqualified deferred compensation plans, including the directors' compensation
plan, the EIP, the management continuity agreements and the Supplemental Savings
and Retirement Plans. Full funding is required in the event of a change of
control.
Based on a review of reports filed with the SEC by General Mills directors and
executive officers regarding their ownership of and transactions in General
Mills common stock, and written representations from those officers and
directors, General Mills believes that each has filed timely and complete
reports under Section 16(a) of the Securities Exchange Act of 1934.
COSTS OF SOLICITATION
The Company will pay for preparation, printing and mailing this Proxy Statement.
We have engaged Georgeson Shareholder Communications Inc. to help us solicit
proxies from stockholders for a fee of $10,500 plus their out-of-pocket
expenses. Proxies may also be solicited personally or by telephone by regular
employees of the Company without additional compensation as well as by employees
of Georgeson. The Company will reimburse banks, brokers and other custodians,
nominees and fiduciaries for their costs of sending the proxy materials to our
beneficial owners.
DELIVERY AND VIEWING OF PROXY MATERIALS
DELIVERY OF PROXY MATERIALS. Securities and Exchange Commission rules now allow
us to deliver a single copy of an annual report and proxy statement to any
household at which two or more stockholders reside, if we believe the
stockholders are members of the same family. This rule benefits both you and the
Company. We believe it eliminates irritating duplicate mailings that
stockholders living at the same address receive and it reduces our printing and
mailing costs. This rule applies to any annual reports, proxy statements, proxy
statements combined with a prospectus or information statements.
Your household may have received a single set of proxy materials this year. If
you prefer to receive your own copy now or in future years, please request a
duplicate set by writing to Wells Fargo Bank Minnesota, N.A. Shareowner
Services, Attn: Admin/General Mills, P.O. Box 64854, St. Paul, MN 55164-0854.
Each stockholder will continue to receive a separate proxy card or voting
instruction card.
If a broker or other nominee holds your shares, you may continue to receive some
duplicate mailings. Certain brokers will eliminate duplicate account mailings by
allowing stockholders to consent to such elimination, or through implied consent
if a stockholder does not request continuation of duplicate mailings. Since not
all brokers and nominees may offer stockholders the opportunity this year to
eliminate duplicate mailings, you may need to contact your broker or nominee
directly to discontinue duplicate mailings from your broker to your household.
VIEWING OF PROXY MATERIALS VIA THE INTERNET. We are able to distribute the
Annual Report and Proxy Statement to General Mills stockholders in a fast and
efficient manner via the Internet. This reduces the
31
amount of paper delivered to a stockholder's address and eliminates the cost of
sending these documents by mail. Stockholders may elect to view all future
annual reports and proxy statements on the Internet instead of receiving them by
mail. If you choose to view these materials online, you will continue to receive
a proxy card in the mail. You may make this election when voting your proxy this
year: simply follow the instructions to vote via the Internet or go directly to
http://www.econsent.com/gis/ to register your consent. Your election to view
proxy materials online is perpetual unless you revoke it later. Future proxy
cards will contain the Internet website address and instructions to view the
materials. You will continue to have the option to vote your shares by
telephone, mail or via the Internet.
ANNUAL REPORT
The 2002 Annual Report to Stockholders, which includes the consolidated
financial statements of the Company for the fiscal year ended May 26, 2002, was
mailed on or about August 15, 2002, to all stockholders entitled to vote at the
annual meeting. If you have not received the Annual Report, please call
1-800-245-5703, and a copy will be sent to you without charge. You may also
request a free copy by writing to the Company Secretary, General Mills, Inc.,
P.O. Box 1113, Minneapolis, MN 55440.
YOUR VOTE IS IMPORTANT!
Please vote by phone, via the Internet or sign and promptly return your proxy
card in the enclosed envelope.
32
APPENDIX A
GENERAL MILLS, INC.
AUDIT COMMITTEE CHARTER
(Revised June 2002)
(This page has been left blank intentionally.)
GENERAL MILLS, INC.
AUDIT COMMITTEE CHARTER
ORGANIZATION. The Audit Committee of General Mills, Inc. is a standing committee
of the Board of Directors. The Committee shall consist of not less than five,
nor more than seven members of the Board. The members shall be elected annually
by the Board, with one member designated by the Board to be the Chair, and shall
not be officers or employees of the Company or of any of its subsidiaries.
Committee members will be independent of management and free from material
business relationships that might interfere with the exercise of independent
judgment as Committee members. They will satisfy such other requirements,
including financial literacy, as may be specified by the rules of the New York
Stock Exchange or regulatory authorities.
The Committee shall meet at least three times annually and may, in its
discretion, delegate specific responsibilities to a subcommittee comprised of
one or more members of the Committee.
STATEMENT OF POLICY. The Audit Committee will assist the Board of Directors in
fulfilling its oversight responsibilities involving:
* The integrity of the Company's financial statements and financial reporting
process.
* The independence of the Company's independent auditors and the performance
of the independent audit.
* The adequacy of the Company's accounting processes and financial controls.
* Compliance with applicable laws and the Company's policy on business ethics
and conduct.
In so doing, it is the responsibility of the Committee to maintain free and open
means of communication among the directors, the independent auditors, the
internal auditors and the management of the Company. The Committee will report
to the Board all significant issues discussed by the Committee and all
recommendations that are to be acted upon by the full Board. The Committee shall
have the resources and authority necessary to discharge its responsibilities,
including the authority to retain independent counsel and other experts or
consultants.
RESPONSIBILITIES. Specific responsibilities of the Audit Committee include:
1. To recommend to the Board the independent auditors for the annual audit of
the Company, evaluate the independence and performance of the independent
auditors, and, if deemed appropriate, recommend that the Board replace the
independent auditors. Because the independent auditors are ultimately
accountable to the Board of Directors, the selection of the independent
auditors shall be the responsibility of the Board and shall be ratified by
the stockholders at the annual meeting.
2. To review and approve the services to be provided by the independent
auditors for the coming year, including the scope of the annual audit of
the Company's financial statements and audit services for pension and
benefit plans.
3. To establish Company guidelines to ensure that independence of the
independent auditor from the Company is maintained. The Company's
independent auditors are permitted to perform the following non-audit
services without specific approval from the Audit Committee:
* Review financial statements of the Company and its subsidiaries, joint
ventures, equity investments, benefit plans and the General Mills
Foundation.
* Conduct statutory audits of foreign operations.
* Prepare statutory tax returns for foreign operations.
* Prepare tax returns for designated employees on international
assignment.
* Prepare supplementary documents to support SEC filings associated with
corporate activities.
* Conduct due diligence reviews in connections with corporate
transactions or investments.
A-1
* With the approval of the Audit Committee, the Company's independent
auditors may perform other non-audit services not prohibited by law or
regulation, up to a maximum of $1,000,000 in the aggregate during a
fiscal year.
The Company's independent auditors may not perform the following services
for the Company:
* Accounting or bookkeeping services.
* Internal audit services related to accounting controls, financial
systems or financial statements.
* Financial information systems design or implementation.
* Operating management services.
4. To meet separately with the independent auditors, with and without
management present, to discuss the results of their audits and
examinations, management's responses and other matters the Committee or the
independent auditors wish to discuss, and to review with the independent
auditors the matters required to be discussed under generally accepted
auditing standards relating to the conduct of the audit.
5. To receive at least annually from the independent auditors a written
statement delineating all relationships between the independent auditors
and the Company, to discuss with the independent auditors any relationships
or non-audit services that may impair their objectivity and independence,
and, if necessary, to take or recommend that the Board take appropriate
action to ensure the independence of the independent auditors.
6. To review with senior management, the internal auditors and the independent
auditors, the adequacy and effectiveness of the Company's accounting and
financial controls and processes to monitor and manage business and
financial risk and legal and ethical compliance.
7. To review with management and the independent auditors significant changes
proposed for the accounting policies of the Company, accounting, tax or
financial reporting proposals that have or may have a material effect on
the Company's financial situation and/or financial reports, the
reasonableness of significant assumptions, accounting judgments or
estimates utilized by the Company in connection with its financial
statements, and the effect of alternative GAAP methods on the Company's
financial statements and a description of any transactions as to which
management obtained advice from the independent auditor on the application
of certain accounting principles.
8. To review and discuss with management and the independent auditors the
Company's audited financial statements, and to recommend to the Board that
the audited financial statements be included in the Company's annual report
on Form 10-K.
9. To review with management and the independent auditors the Company's
quarterly financial statements and other matters required to be discussed
with the Committee by the independent auditors under generally accepted
auditing standards. The Chair of the Committee may represent the entire
Committee for purposes of this review.
10. To approve any Committee report required to be included in the proxy
statement for the Company's annual meeting of stockholders.
11. To review and approve the audit plan, budget and staffing of the Company's
internal audit function for the coming year.
12. To review periodically the quality and depth of staffing in the Company's
auditing, accounting, and financial departments.
13. To review and reassess the adequacy of this charter annually and to
recommend any proposed changes to the Board for approval.
A-2
(This page has been left blank intentionally.)
NOTICE OF 2002 ANNUAL MEETING OF STOCKHOLDERS
AND
PROXY STATEMENT
GENERAL MILLS, INC.
[LOGO] GENERAL MILLS
ANNUAL MEETING OF STOCKHOLDERS
MONDAY, SEPTEMBER 23, 2002
11:00 A.M. (CENTRAL DAYLIGHT TIME)
THE CHILDREN'S THEATRE COMPANY
2400 THIRD AVENUE SOUTH
MINNEAPOLIS, MN
GENERAL MILLS, INC.
[LOGO]
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS PROXY
2002
I appoint Stephen W. Sanger, Stephen R. Demeritt and Raymond G. Viault, together
and separately, as proxies to vote all shares of common stock that I have power
to vote at the annual meeting of stockholders to be held on September 23, 2002
at Minneapolis, Minnesota, and at any adjournment thereof, in accordance with
the instructions on the reverse side of this card and with the same effect as
though I were present in person and voting such shares. The proxies are
authorized in their discretion to vote upon such other business as may properly
come before the meeting and they may name others to take their place.
(CONTINUED, AND TO BE SIGNED AND DATED ON REVERSE SIDE)
VOTE BY PHONE VOTE VIA INTERNET VOTE BY MAIL
(FROM THE U.S. AND CANADA) http://www.eproxy.com/gis/
1-800-240-6326 --------------------------
Use any touch-tone telephone Use the Internet to vote your Mark, sign and date
to vote your proxy 24 hours proxy 24 hours a day, 7 days your proxy card and
a day, 7 days a week. Have a week. Have your proxy card return it in the
your proxy card in hand when in hand when you access the postage-paid envelope
you call. You will be prompted web site. You will be prompted we have provided.
to enter your 3-digit to enter your 3-digit company
company number and a 7-digit number and a 7-digit control
control number, which are number, which are located above,
located above, and then to create an electronic ballot.
follow the simple intructions.
Your telephone or Internet vote authorizes the named proxies to vote your shares
in the same manner as if you marked, signed and returned the proxy card. The
deadline for telephone or Internet voting is noon EDT, Sunday, September 22,
2002.
IF YOU VOTE BY PHONE OR INTERNET, PLEASE DO NOT MAIL YOUR PROXY CARD
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1 AND 2.
1. ELECTION OF 01 Stephen R. Demeritt 02 Livio D. DeSimone [ ] FOR all listed [ ] WITHHOLD
DIRECTORS: 03 William T. Esrey 04 Raymond V. Gilmartin nominees AUTHORITY
05 Judith R. Hope 06 Robert L. Johnson (except as to vote for all listed
07 John M. Keenan 08 Heidi G. Miller marked below) nominees
09 Stephen W. Sanger 10 A. Michael Spence
11 Dorothy A. Terrell 12 Raymond G. Viault
13 Paul S. Walsh
PLEASE FOLD HERE
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE(S),
WRITE THE NUMBER(S) OF THAT INDIVIDUAL(S) IN THE BOX PROVIDED TO THE RIGHT.)
| |
| |
--------------------------------
2. APPROVAL OF APPOINTMENT OF KPMG LLP AS INDEPENDENT AUDITORS. [ ] For [ ] Against [ ] Abstain
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" ITEMS 3 AND 4.
-------
3. STOCKHOLDER PROPOSAL CONCERNING GENETICALLY ENGINEERED
FOOD PRODUCTS. [ ] For [ ] Against [ ] Abstain
4. STOCKHOLDER PROPOSAL CONCERNING GLOBAL WORKERS RIGHTS STANDARDS. [ ] For [ ] Against [ ] Abstain
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, IT WILL BE VOTED
"FOR" ITEMS 1 AND 2 AND "AGAINST" ITEMS 3 AND 4.
SIGN-UP TODAY TO VIEW FUTURE PROXY STATEMENTS AND ANNUAL REPORTS VIA THE
INTERNET, INSTEAD OF RECEIVING THEM BY MAIL. TO REGISTER, FOLLOW INSTRUCTIONS
FOR INTERNET VOTING OR REGISTER YOUR CONSENT DIRECTLY BY GOING TO
http://www.econsent.com/gis/.
--------------------------------
| |
| |
--------------------------------
Signature(s) of Stockholder(s)
in Box
PLEASE SIGN exactly as name
appears at left. Joint owners
should each sign. Executors,
administrators, trustees, etc.
should so indicate when signing.
If signer is a corporation,
please sign full name by duly
authorized officer.
[LOGO] GENERAL MILLS
ANNUAL MEETING OF STOCKHOLDERS
MONDAY, SEPTEMBER 23, 2002 PROXY
11:00 A.M. (CENTRAL DAYLIGHT TIME) 2002
THE CHILDREN'S THEATRE COMPANY
2400 THIRD AVENUE SOUTH
MINNEAPOLIS, MN
I appoint Stephen W. Sanger, Stephen R. Demeritt and Raymond G. Viault, together
and separately, as proxies to vote all shares of common stock that I have power
to vote at the annual meeting of stockholders to be held on September 23, 2002
at Minneapolis, Minnesota, and at any adjournment thereof, in accordance with
the instructions on the reverse side of this card and with the same effect as
though I were present in person and voting such shares. The proxies are
authorized in their discretion to vote upon such other business as may properly
come before the meeting and they may name others to take their place.
(CONTINUED, AND TO BE SIGNED AND DATED ON REVERSE SIDE)
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1 AND 2.
1. ELECTION OF 01 Stephen R. Demeritt 02 Livio D. DeSimone [ ] FOR all listed [ ] WITHHOLD
DIRECTORS: 03 William T. Esrey 04 Raymond V. Gilmartin nominees AUTHORITY
05 Judith R. Hope 06 Robert L. Johnson (except as to vote for all listed
07 John M. Keenan 08 Heidi G. Miller marked below) nominees
09 Stephen W. Sanger 10 A. Michael Spence
11 Dorothy A. Terrell 12 Raymond G. Viault
13 Paul S. Walsh
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE(S),
WRITE THE NUMBER(S) OF THAT INDIVIDUAL(S) IN THE BOX PROVIDED TO THE RIGHT.)
| |
| |
--------------------------------
2. APPROVAL OF APPOINTMENT OF KPMG LLP AS INDEPENDENT AUDITORS. [ ] For [ ] Against [ ] Abstain
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" ITEMS 3 AND 4.
-------
3. STOCKHOLDER PROPOSAL CONCERNING GENETICALLY ENGINEERED
FOOD PRODUCTS. [ ] For [ ] Against [ ] Abstain
4. STOCKHOLDER PROPOSAL CONCERNING GLOBAL WORKERS RIGHTS STANDARDS. [ ] For [ ] Against [ ] Abstain
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, IT WILL BE VOTED
"FOR" ITEMS 1 AND 2 AND "AGAINST" ITEMS 3 AND 4.
--- -------
Dated __________________________
--------------------------------
| |
| |
--------------------------------
Signature(s) of Stockholder(s)
in Box
PLEASE SIGN exactly as name
appears at left. Joint owners
should each sign. Executors,
administrators, trustees, etc.
should so indicate when signing.
If signer is a corporation,
please sign full name by duly
authorized officer.
GENERAL MILLS, INC.
NOTICE OF 2002 ANNUAL MEETING OF STOCKHOLDERS
MONDAY, SEPTEMBER 23, 2002
August 16, 2002
Dear Stockholder:
The Annual Meeting of Stockholders of General Mills, Inc. will be held on
Monday, September 23, 2002, at 11:00 a.m., Central Daylight Time, in the
auditorium of the Children's Theatre Company, 2400 Third Avenue South,
Minneapolis, Minnesota for the following purposes:
1) To elect 13 directors;
2) To approve KPMG LLP as independent auditors for fiscal year 2003;
3) To act on a stockholder proposal concerning genetically engineered
food products, if presented;
4) To act on a stockholder proposal concerning global workers rights
standards, if presented; and
5) To act on any other proper business of the meeting.
RECORD DATE
July 25, 2002 has been fixed as the record date for determining stockholders who
are entitled to vote at the annual meeting. If you held General Mills common
stock on that date, or held shares of Ralcorp Holdings, Inc. common stock that
can be exchanged for General Mills stock as a result of the Company's 1997
acquisition of the Ralcorp branded cereal and snack businesses, you can vote at
the annual meeting.
DUPLICATE MAILINGS OF PROXY MATERIALS
Many stockholders have asked us to help eliminate the amount of duplicate
materials being delivered to their household. In May 2002, we sent a letter to
you asking whether you wanted to continue receiving more than one set of proxy
materials at your address. Since you did not object to receiving a single copy
of our Annual Report and Proxy Statement, only one copy of these materials has
been mailed to your address. Each General Mills stockholder residing at your
address, however, will receive a separate proxy card in its own envelope.
Stockholders who instructed us to continue sending a duplicate set of the Annual
Report and Proxy Statement have been mailed a complete set of materials.
Enclosed is a proxy card and voting instructions. Please review the Annual
Report and Proxy Statement that have been mailed to your household before voting
on the proposals set forth on the proxy card. You may vote by mail, telephone or
via the Internet as instructed on the card. Please contact Wells Fargo
Shareowner Services at 1-877-602-7615 or 651-450-4104 if you have not received
all proxy cards for your household by September 3, 2002. If you would like to
receive a duplicate set of proxy materials, you may contact Wells Fargo
Shareowner Services directly.
Sincerely,
Siri S. Marshall, Secretary
PLEASE NOTE THAT ONLY ONE COPY OF OUR ANNUAL REPORT AND PROXY STATEMENT HAS BEEN
MAILED, IN A SEPARATE ENVELOPE, TO YOUR HOUSEHOLD.
KATHLEEN M. CURRAN
Manager, Corporate Secretary's Office
and Assistant Secretary
Telephone: (763) 764-5676
Facsimile: (763) 764-5011
August 16, 2002
Dear Stockholder:
On January 31, 1997, General Mills purchased the branded cereal and snack food
businesses of Ralcorp Holdings, Inc. and you, as a Ralcorp shareholder, became
entitled to receive General Mills common stock in exchange for your Ralcorp
stock.
Our records show that you have not yet exchanged your Ralcorp shares (these are
the green certificates) for General Mills shares. Until that exchange is made,
we cannot pay General Mills dividends to you. Since the Ralcorp acquisition, we
have paid $8.66 in dividends per General Mills share. Your dividends are being
held for you and will be paid at the time you exchange your shares.
We encourage you to exchange your Ralcorp shares. If no exchange is made, we are
required by law to turn over the shares and accumulated dividends to the state
of last known address as unclaimed property, based on each state's escheat
schedule.
If you have questions about how to exchange your shares or you have lost your
letter of transmittal, please call Wells Fargo Shareowner Services (formerly
Norwest) at 1-800-380-1372. We look forward to serving your needs as a General
Mills stockholder.
Very truly yours,
Kathleen M. Curran
PROXY BY PHONE
2002 PHONE VOTING SCRIPT
PROPOSAL BY PROPOSAL
SPEECH 1 Welcome. Please enter your three digit company
number located in the box in the upper right hand
corner of the proxy card.
IF NOT ENTERING AFTER ONE OR TWO PROMPTS,
Please enter the three digit company number now.
IF NOT ENTERING AFTER THREE PROMPTS,
I'm sorry. You are experiencing problems. Please
call again later or sign your proxy card and return
it in the postage-paid envelope.
--------------------------------------------------------------------------------
SPEECH 2 Please enter your seven digit NUMERIC Control Number
that is located in the box, directly under your
company number.
--------------------------------------------------------------------------------
SPEECH 2A IF INCORRECT CONTROL NUMBER HAS BEEN ENTERED,
I'm sorry. That was an incorrect control number.
Please reenter the seven digit numeric control
number now.
IF INCORRECTLY ENTERED THREE TIMES,
I'm sorry. The control numbers you entered were
invalid. Please call again later or sign your proxy
card and return it in the postage-paid envelope.
IF NOT ENTERING AFTER ONE OR TWO PROMPTS,
Please enter your seven digit control number now.
IF NOT ENTERING AFTER THREE PROMPTS,
I'm sorry. You are experiencing problems. Please
call again later or sign your proxy card and return
it in the postage-paid envelope.
WHEN CORRECTLY ENTERED, SYSTEM GOES TO SPEECH 3.
--------------------------------------------------------------------------------
SPEECH 3 To vote as the General Mills, Inc. Board recommends
on ALL proposals - Press 1 now. To vote on each
proposal separately, Press 0 now.
IF 1 IS PRESSED, SYSTEM GOES TO CLOSING A. IF 0 IS
PRESSED, SYSTEM GOES TO SPEECH 4.
--------------------------------------------------------------------------------
SPEECH 4 Proposal 1:
To vote for ALL Nominees, Press 1; to Withhold from
all Nominees, Press 9; To withhold from an
individual nominee, Press 0. Make your selection
now.
IF 1 IS PRESSED, SYSTEM GOES TO SPEECH 6. IF 9 IS
PRESSED, SYSTEM GOES TO SPEECH 6. IF 0 IS PRESSED,
SYSTEM GOES TO SPEECH 5.
SPEECH 5 Enter the two digit number that appears next to the
nominee you DO NOT wish to vote for. Make your
selection now.
Press 1 to withhold from another Nominee or Press 0
if you have completed voting on Directors.
SUBSET: IF 1 - REPEAT SUBSET - "ENTER THE TWO....."
IF 0 - GO TO PROPOSAL 2, SPEECH 6.
--------------------------------------------------------------------------------
SPEECH 6 Proposal 2:
To vote FOR, Press 1; AGAINST, Press 9; Abstain,
Press 0. IF 1, 9 OR 0 PRESSED, GO TO SPEECH 7.
--------------------------------------------------------------------------------
SPEECH 7 Proposal 3:
To vote FOR, Press 1; AGAINST, Press 9; Abstain,
Press 0. IF 1,9 OR 0 PRESSED, GO TO SPEECH 8.
--------------------------------------------------------------------------------
SPEECH 8 Proposal 4:
To vote FOR, Press 1, AGAINST, Press 9, Abstain,
Press 0. AFTER COMPLETION - GO TO CLOSING B
--------------------------------------------------------------------------------
CLOSING A You have voted as the Board recommended. If this is
correct, Press 1; if incorrect, Press 0.
IF 1 IS PRESSED, GO TO SPEECH 9. IF 0 IS PRESSED, GO
TO SPEECH 10.
--------------------------------------------------------------------------------
CLOSING B Your votes have been cast as follows:
Proposal 1 - For All - Withhold All -
For All Except___
Proposal 2 - For, Against, Abstain
Proposal 3 - For, Against, Abstain
Proposal 4 - For, Against, Abstain
If this is correct, Press 1; if incorrect, Press 0.
IF 1 IS PRESSED, GO TO SPEECH 10. IF 0 IS PRESSED,
GO TO SPEECH 9.
--------------------------------------------------------------------------------
SPEECH 9 Your votes have been canceled. Please call again,
or mark, sign, date and return your proxy card in
the envelope provided. Good bye.
--------------------------------------------------------------------------------
SPEECH 10 Thank you for voting.
--------------------------------------------------------------------------------
[LOGO] General Mills
WELCOME TO GENERAL MILLS, INC.'S ELECTRONIC VOTING.
Access to this site is secured.
You will need the 3 digit company number and the 7 digit control number from the
top of the card you received by mail along with the Proxy Statement.
Please click on the proceed button below to continue to the secure voting site.
[Proceed]
[LOGO] General Mills
GENERAL MILLS, INC.'S ELECTRONIC VOTING
Please enter and submit the 3 digit company number and the 7 digit control
number from the top of the card you received by mail along with the Proxy
Statement.
Company number (3 digits):
/---------------------------------/
Control number (7 digits):
/---------------------------------/
[Submit]
ADDITIONAL INFORMATION ABOUT GENERAL MILLS, INC. IS AVAILABLE AT OUR
CORPORATE PAGE.
If you encounter difficulties in voting electronically, please complete the card
you received with the Proxy Statement and mail it in the envelope provided to
you.
[LOGO] General Mills
GENERAL MILLS, INC.'S ELECTRONIC VOTING
The control number or the company number that you entered was not recognized.
Please use the Back button on your browser, enter the appropriate information
and click on the Proceed button.
ADDITIONAL INFORMATION ABOUT GENERAL MILLS, INC. IS AVAILABLE AT OUR
CORPORATE PAGE.
If you encounter difficulties in voting electronically, please complete the card
you received with the Proxy Statement and mail it in the envelope provided to
you.
[LOGO] General Mills
GENERAL MILLS, INC.'S ELECTRONIC VOTING
Your identification number was recognized. Your name, address, and the number of
shares you owned as of the record date on the records of Wells Fargo Shareowner
Services, General Mills, Inc.'s transfer agent, appear below. If you own shares
in street name or through a broker, they will not appear in this listing.
---------------------------- ---------------------------- -------------------
Stockholder Source of Shares Number of Shares
---------------------------- ---------------------------- -------------------
Test Person COM 144.235
Somewhere Nice
Anywhere, Anystate 11111 RS 35,646.000
VIP 7,187.319
---------------------------- ---------------------------- -------------------
The following online proxy card allows you to electronically authorize the
voting of these shares. Your vote will not be authorized until you have clicked
the SUBMIT YOUR VOTE button. Voting is explained in the Proxy Statement which
you received by mail.
[Proceed]
ADDITIONAL INFORMATION ABOUT GENERAL MILLS, INC. IS AVAILABLE AT OUR
CORPORATE PAGE.
If you encounter difficulties in voting electronically, please complete the card
you received with the Proxy Statement and mail it in the envelope provided to
you.
The following online proxy card allows you to electronically authorize the
voting of your shares. Your vote will not be authorized until you have clicked
the SUBMIT YOUR VOTE button. The items to be voted are explained in the Proxy
Statement which you received by mail.
GENERAL MILLS, INC.
ANNUAL MEETING OF STOCKHOLDERS
MONDAY, SEPTEMBER 23, 2002
11:00 a.m. (CENTRAL DAYLIGHT TIME)
THE CHILDREN'S THEATRE COMPANY
2400 THIRD AVENUE SOUTH
MINNEAPOLIS, MN
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
I appoint Stephen W. Sanger, Stephen R. Demeritt and Raymond G. Viault, together
and separately, as proxies to vote all shares of common stock that I have power
to vote at the annual meeting of stockholders to be held on September 23, 2002
at Minneapolis, Minnesota, and at any adjournment thereof, in accordance with
the instructions below and with the same effect as though I were present in
person and voting such shares. The proxies are authorized in their discretion to
vote upon such other business as may properly come before the meeting and they
may name others to take their place.
If you click on the "Submit Your Vote" button without direction on any matter,
the proxy will be voted "FOR" Items 1 and 2 and "AGAINST" Items 3 and 4.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1 and 2 AND "AGAINST" ITEMS
3 and 4.
THE BOARD RECOMMENDS A VOTE "FOR" ALL NOMINEES FOR DIRECTOR.
For all Nominees Withhold
Except As Noted As To All
Below Nominees
1. Election of directors: [ ] [ ]
(INSTRUCTIONS: To withhold authority to vote for any individual nominee(s),
click on the box next to the nominee's name below.)
[ ] Stephen R. Demeritt [ ] Livio D. DeSimone
[ ] William T. Esrey [ ] Raymond V. Gilmartin
[ ] Judith R. Hope [ ] Robert L. Johnson
[ ] John M. Keenan [ ] Heidi G. Miller
[ ] Stephen W. Sanger [ ] A. Michael Spence
[ ] Dorothy A. Terrell [ ] Raymond G. Viault
[ ] Paul S. Walsh
THE BOARD RECOMMENDS A VOTE "FOR" PROPOSAL 2.
For Against Abstain
2. Approval of appointment of KPMG LLP as independent
auditors. [ ] [ ] [ ]
THE BOARD RECOMMENDS A VOTE "AGAINST" PROPOSALS 3 AND 4.
For Against Abstain
3. Stockholders proposal concerning genetically
engineered food products. [ ] [ ] [ ]
For Against Abstain
4. Stockholders proposal concerning global workers
rights standards. [ ] [ ] [ ]
--------------------------------------------------------------------------------
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION IS MADE, IT WILL BE VOTED
"FOR" ITEMS 1 AND 2 AND "AGAINST" ITEMS 3 AND 4.
If you are a joint owner of the shares being voted, by clicking the SUBMIT YOUR
VOTE button, you attest that all owners of such shares have consented to the
authorization of this proxy.
If you are holding the shares being voted as an executor, administrator,
trustee, guardian, or attorney-in-fact, or if you are an officer of a corporate
stockholder, by clicking the SUBMIT YOUR VOTE button, you attest that you have
the authority to authorize this proxy.
SUBMIT YOUR VOTE
ADDITIONAL INFORMATION ABOUT GENERAL MILLS, INC. IS AVAILABLE AT OUR CORPORATE
PAGE.
If you encounter difficulties in voting electronically, please complete the card
you received with the Proxy Statement and mail it in the envelope provided to
you.
4. Stockholders proposal concerning global workers rights standards.
AGAINST
If this IS NOT how you intended to vote, please use the back function of your
browser to return to the card and correct your vote.
If this is how you intended to vote, please select the proceed button below.
PROCEED
ADDITIONAL INFORMATION ABOUT GENERAL MILLS, INC. IS AVAILABLE AT OUR CORPORATE
PAGE.
If you encounter difficulties in voting electronically, please complete the card
you received with the Proxy Statement and mail it in the envelope provided to
you.
Next Section
Previous Section