Exhibit 10.30 to General Mills, Inc. Form 10-K for fiscal year ended May 27, 2007








EXHIBIT 10.30


 


GENERAL MILLS, INC.


2006 COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS


 







GENERAL MILLS, INC.

2006 COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS



	
   

  	
   

  
	
  1.

  	
  PURPOSE

  



          The
purpose of the General Mills, Inc. 2006 Compensation Plan for Non-Employee
Directors (the “Plan”) is to provide a compensation program which will attract
and retain qualified individuals not employed by General Mills, Inc. and its subsidiaries
(the “Company”) to serve on the Board of Directors of the Company (the “Board”)
and to further align the interests of non-employee directors with those of the
stockholders by providing that a portion of compensation will be linked
directly to increases in stockholder value.


	
   

  	
   

  
	
  2.

  	
  EFFECTIVE DATE, DURATION OF PLAN

  



          This
Plan shall become effective as of September 25, 2006, subject to the approval
of the Plan by the stockholders. The Plan will terminate on September 30,
2011 or such earlier date as determined by the Board or the Compensation
Committee of the Board (the “Committee”); provided that no such termination
shall affect rights earned or accrued under the Plan prior to the date of
termination.


	
   

  	
   

  
	
  3.

  	
  DEFINITIONS

  



          Wherever
used in this Plan, the following terms have the meanings set forth below:


          “Board”
means the Board of Directors of the Company.


          “Change
of Control” has the meaning set forth in Section 11.


          “Code”
means the Internal Revenue Code of 1986, as amended.


          “Committee”
has the meaning set forth in Section 2.


          “Common
Stock” means Company common stock ($.10 par value).


          “Company”
means General Mills, Inc. and its subsidiaries.


          “Deferred
Compensation Account” has the meaning set forth in Section 6(d).


          “Election
Form” means a written form provided by the Committee pursuant to which a
Participant may elect the form and timing of distributions with respect to his or
her retainer, Stock Units and dividend equivalents under the Plan.






          “Fair Market
Value” means the closing price of the Common Stock on the New York Stock
Exchange on the applicable date.


          “Option”
has the meaning set forth in Section 7(a).


          “Plan”
means
the General Mills, Inc. 2006 Compensation Plan for Non-Employee
Directors as set forth herein and as amended.


          “Plan
Year” has the meaning set forth in Section 6(a).


          “Separation
from Service” or “Separate from Service” means a “separation from
service” within the meaning of Code section 409A.


          “Stock
Unit Account” has the meaning set forth in Section 8(a). 


          “Stock
Units” has the meaning set forth in 8(a).


	
   

  	
   

  
	
  4.

  	
  PARTICIPATION

  



          Each
member of the Board who is not an employee of the Company at the date
compensation is earned or accrued shall be eligible to participate in the Plan
unless prohibited from participating by the terms of their employment (a “Participant”).


	
   

  	
   

  
	
  5.

  	
  COMMON STOCK SUBJECT TO THE PLAN

  



          a)
General. The Common Stock to be issued under this Plan is to be made
available from the authorized but unissued Common Stock, shares of Common Stock
held in the treasury, or Common Stock purchased on the open market or
otherwise. Subject to the provisions of the next succeeding paragraphs, the
maximum aggregate number of shares authorized to be issued under the Plan shall
be 700,000 and the maximum number of shares authorized to be issued under the
Plan in a single Plan Year shall be 160,000.


          Upon
forfeiture or termination of Stock Units prior to vesting, the shares of Common
Stock subject thereto shall again be available for awards under the Plan.


          b)
Adjustments for Corporate Transactions. If a corporate transaction has
occurred affecting the Common Stock such that an adjustment to outstanding
awards is required to preserve (or prevent enlargement of) the benefits or
potential benefits intended at the time of grant, then in such manner as the
Committee deems equitable, an appropriate adjustment shall be made to (i) the
number and kind of shares which may be awarded under the Plan; (ii) the number
and kind of shares subject to outstanding awards; (iii) the number of shares credited
to a Stock Unit Account; and (iv) the exercise price of outstanding Options
provided that the number of shares of Common Stock subject to any Option
denominated in Common Stock shall always be a whole number. For this purpose a
corporate transaction includes, but is not limited to, 


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any dividend or other distribution (whether in the
form of cash, 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 other similar corporate transaction. Notwithstanding
anything in this Section to the contrary, an adjustment to an Option under this
Section 5(b) shall be made in a manner that will not result in a new grant of
an Option under Code Section 409A.


	
   

  	
   

  
	
  6.

  	
  RETAINER

  



          a)
General. Each non-employee director shall be entitled to receive a
retainer with respect to each one-year board term, beginning the day of each
annual stockholders’ meeting and ending the day before the succeeding annual
stockholders’ meeting (the “Plan Year”) in an amount determined from time to
time by the Board. Retainers shall be earned and paid at the end of each of the
Company’s fiscal quarters. 


          b)
Normal Payment Terms. The normal payment terms for retainers are cash in
a lump sum. In the absence of an affirmative election to the contrary, the
retainer (or the portion not subject to such elections) shall be paid 10
business days following the last day of each quarterly period described above
in (a). 


          c)
Deferral Elections. Each Participant may elect an alternative form (lump
sum vs. installments) in which a retainer may be delivered and the timing for
such delivery, pursuant to the terms of Section 9. Participants shall make such
election by filing an irrevocable Election Form with the Committee before the
calendar year in which a Plan Year begins. The election shall apply to amounts
earned in a period described in (a) above that begins during the Plan Year. Notwithstanding
the foregoing, in the first year in which a non-employee director becomes
eligible to participate in the Plan, an election may be made with respect to
services to be performed subsequent to the election, to the extent permitted
under Code section 409A. Such an election must be made on an Election Form
within 30 days after the date the non-employee director becomes eligible to
participate in the Plan. 


          d)
Deferred Cash Alternative. For each Participant who affirmatively elects
to defer receipt of his or her retainers in the form of deferred cash, the
Company shall establish a separate account (a “Deferred Compensation Account”)
and credit such deferred cash compensation into that Account as of the date the
amounts would otherwise be paid. A separate Deferred Compensation Account shall
be established for each Plan Year a Participant makes such a deferral election.
Earnings, gains and losses shall be credited to each such Deferred Compensation
Account based on the rate earned by the fund or funds selected by the Participant
from among funds or portfolios established under the General Mills, Inc. 401(k)
Savings Plan or any other qualified benefit plan maintained by the Company
which the Minor Amendment Committee, or its delegate, in its discretion, may
from time to time establish. 


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Distributions from a Deferred Compensation Account
shall be made in accordance with Section 9. 


          The
Company has established a Supplemental Benefits Trust with Wells Fargo Bank
Minnesota, N.A. as trustee to hold assets of the Company under certain
circumstances as a reserve for the discharge of the Company’s obligations as to
Deferred Compensation Accounts under the Plan and certain other deferred
compensation plans of the Company. In the event of a Change in Control as
defined in Section 11 below, the Company shall be obligated to immediately
contribute such amounts to the trust as may be necessary to fully fund all Deferred
Compensation Accounts payable under the Plan. Any Participant in the Plan shall
have the right to demand and secure specific performance of this provision. All
assets held in the trust remain subject only to the claims of the Company’s
general creditors whose claims against the Company are not satisfied because of
the Company’s bankruptcy or insolvency (as those terms are defined in the trust
agreement). No Participant has any preferred claim on, or beneficial ownership
interest in, any assets of the trust before the assets are paid to the Participant
and all rights created under the trust, as under the Plan, are unsecured
contractual claims of the Participant against the Company.


          e)
Common Stock Alternative. Each Participant may affirmatively elect to
receive all or a specified percentage of his or her retainers for a Plan Year
in shares of Common Stock, which, if elected, will be issued 10 business days
following the last day of each quarterly period during the Plan Year described
above in (a). Only whole numbers of shares will be issued, with any fractional
share amounts paid in cash. For purposes of computing the number of shares
earned each quarter during the Plan Year, the value of each share shall be
equal to the Fair Market Value on the third Business Day preceding the last day
of each quarter described above in (a) during the Plan Year. For the purposes
of this Plan, “Business Day” shall mean a day on which the New York Stock
Exchange is open for trading. 


          f)
Death. Notwithstanding any other provision of the Plan, if a Participant
dies during a Plan Year, the balance of the amount due for the full quarter in
which death occurs shall be payable in full to the Participant’s estate, in
cash, 60 days following the date of death.


	
   

  	
   

  
	
  7.

  	
  NON-QUALIFIED STOCK OPTIONS

  



          a)
Grant of Options. Each non-employee director on the effective date of
the Plan (or, if first elected after the effective date of the Plan, on the
date the non-employee director first attends a Board meeting) shall be awarded
an option (an “Option”) to purchase shares of Common Stock, in an amount
determined from time to time by the Board, or its delegate. As of the close of
business on each successive annual stockholders’ meeting after the date of the
original award, each Participant who is re-elected to the Board shall be
granted an additional Option to purchase shares of 


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Common Stock. All Options granted under the Plan shall
be non-statutory options not entitled to special tax treatment under Code section
422.


          b)
Option Exercise Price. The per share price to be paid by the Participant
at the time an Option is exercised shall be 100% of the Fair Market Value on
the date of grant, or on the last date preceding the date of grant on which the
Common Stock was traded.


          c)
Term of Option. Each Option shall expire ten (10) years from the date of
grant.


          d)
Exercise and Vesting of Option. Each Option will vest on the date of the
annual stockholders’ meeting next following the date the Option is granted. Upon
vesting, a Participant shall be given the full ten (10) year term to exercise
the Option without regard to whether he or she continues to serve on the Board.
If, for any reason, a Participant ceases to serve on the Board prior to the
date an Option vests, such Option shall be forfeited and all further rights of
the Participant to or with respect to such Option shall terminate. Notwithstanding
the foregoing, if a Participant should die during his or her term of service on
the Board, any vested Option may be exercised by the person designated in such Participant’s
last will and testament or, in the absence of such designation, by the Participant’s
estate, and any unvested Options shall fully vest and become exercisable upon
death for the remainder of the Option’s full term.


          e)
Method of Exercise. A Participant exercising an Option shall give notice
to the Company of such exercise and of the number of shares elected to be
purchased prior to 4:30 P.M. CST/CDT on the day of exercise, which must be a
business day at the executive offices of the Company. The exercise price shall
be paid to the Company at the time of such exercise, subject to any applicable
rule or regulation adopted by the Committee:


	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  in cash (including check, draft, money order or wire
  transfer made payable to the order of the Company);

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  through the tender of shares of Common Stock owned
  by the Participant (by either actual delivery or attestation); or

  
	
   

  	
   

  	
   

  
	
   

  	
  (iii)

  	
  by a combination of (i) and (ii) above.

  



To determine the amount of the payment, Common Stock
delivered pursuant to (ii) or (iii) shall have a value equal to the Fair Market
Value of the Common Stock on the date of exercise. 


          f)
Non-transferability. Except as provided by rule adopted by the
Committee, an Option shall be non-assignable and non-transferable by a Participant
other than by will or the laws of descent and distribution. A Participant shall
forfeit any Option 


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assigned or transferred, voluntarily or involuntarily,
other than as permitted under this subsection.


	
   

  	
   

  
	
  8.

  	
  STOCK UNITS

  



          a)
Awards. On the effective date of the Plan (or, if a Participant is first
elected after the effective date of the Plan, on the date the Participant first
attends a Board meeting) and at the close of business on each successive annual
stockholders’ meeting, each Participant shall be awarded the right to receive
shares of Common Stock (“Stock Units”), subject to vesting as provided in
Section 8(b). Only a Participant who is re-elected to the Board shall be
entitled to a grant under this Section 8(a) of Stock Units awarded at the close
of business on an annual meeting date after the date of the original grant to Participants.
A separate Stock Unit Account will be established for the Participant each time
an award of Stock Units is made.


                    The
maximum aggregate number of shares authorized to be issued under the Plan upon
vesting of Stock Unit awards shall be 175,000. Participants receiving Stock
Units will have no rights as stockholders of the Company with respect to
allocations made to their Stock Unit Account(s), except the right to receive
dividend equivalent allocations under Section 8(d). 


                    Stock
Units may not be sold, transferred, assigned, pledged or otherwise encumbered
or disposed of until such time as share certificates for Common Stock are
issued to the Participants.


          b)
Vesting of Stock Units. A Participant’s interest in the Stock Units
shall vest on the date of the annual stockholders’ meeting next following the
date of the award of the Stock Units. If, for any reason, a Participant ceases
to serve on the Board prior to the date the Participant’s interest in a grant
of Stock Units vests, such Stock Units shall be forfeited and all further
rights of the Participant to or with respect to such Stock Units shall
terminate. Notwithstanding the foregoing, a Participant who dies while serving
on the Board prior to the vesting of Stock Units shall fully vest in such Stock
Units, effective as of the date of death. 


          c)
Election Concerning Receipt of Common Stock. Each Participant receiving
an award of Stock Units under Section 8(a) may elect the time and form (lump
sum vs. installments) of distribution of Common Stock attributable to such
Stock Units, pursuant to the terms of Section 9. If no affirmative election is
made, all Stock Units shall be paid in shares of Common Stock 10 days following
vesting. 


          d)
Dividend Equivalents. The Participant may also elect to have dividend
equivalents payable on Stock Units paid currently in cash or reinvested in
Stock Units. If the amounts are reinvested, on each dividend payment date for
the Common Stock, the Company will credit each Stock Unit Account with an
amount equal to the dividends that would have been paid had the Stock Units been
actual shares of Common Stock, 


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which shall be used to “purchase” additional Stock
Units at a price equal to the Fair Market Value on the dividend date. Such
additional Stock Units shall be distributed at the same time and in the same
form as the rest of the Stock Unit Account balance. If the Participant fails to
make an election, the dividend equivalent amounts shall be paid in cash
currently.


          e)
Timing of Elections. In order to make an election under Sections 8(c)
and/or 8(d) with respect to Stock Units awarded for a Plan Year, a Participant
shall file an irrevocable Election Form with the Committee before the calendar
year in which the Plan Year begins. Notwithstanding the foregoing, in the first
year in which a non-employee director becomes eligible to participate in the
Plan, a deferral election may be made with respect to services to be performed
subsequent to the election, to the extent permitted under Code section 409A. Such
an election must be made on an Election Form within 30 days after the date the
non-employee director becomes eligible to participate in the Plan.


	
   

  	
   

  
	
  9.

  	
  DISTRIBUTION PROVISIONS FOR
  DEFERRED CASH AND STOCK UNITS

  



          The
following distribution provisions shall apply to Deferred Compensation Accounts
and Stock Unit Accounts:


          a)
Timing. Distributions from Deferred Compensation Accounts shall normally
commence at Separation from Service, however, a Participant may affirmatively
elect a specified date for commencement, provided said date is not later than
age 70. The same rule applies to Stock Units which have been deferred beyond
the vesting period described in Section 8(b). Elections as to the timing of
benefit commencement shall be made in accordance with Sections 6 and 8, as
appropriate.


          b)
 Form of Distribution. Distributions
shall normally be made in a lump sum. However, a Participant may affirmatively elect
to receive substantially equal annual installments over a period of up to 10
years. Such elections shall be made in accordance with Sections 6 and 8, as
appropriate.


          c)
Manner of Distribution. Amounts credited to Deferred Compensation
Accounts shall be paid in cash. Amounts credited to Stock Unit Accounts shall
be paid in Common Stock based on the number of Stock Units credited to the
Stock Unit Account and paid in cash equal to any dividend equivalent amounts
which had not been used to “purchase” additional Stock Units.


          d)
Distribution Upon Death. Notwithstanding any elections by a Participant
or provisions of the Plan to the contrary, if a Participant dies before full
distribution of a Deferred Compensation Account or Stock Unit Account, such
accounts shall be distributed to the Participant’s estate in a lump sum 60 days
following the date of death. 


          e)
Changes in Time or Form of Distribution. A Participant who has elected
to have an Account payable as of a specified date in (a) above (but not a
Participant who 


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has elected Separation from Service as the payment
timing) may make any number of subsequent elections to change the time of
commencement and/or form (lump sum vs. installments) of a distribution;
provided, however, that such an election shall be effective only if all of the
following conditions are satisfied:


	
   

  	
   

  
	
   

  	
            (i)
  the election may not take effect until at least twelve (12) months after the
  date on which the election is made;

  
	
   

  	
   

  
	
   

  	
            (ii)
  a distribution may not be made earlier than at least five (5) years from the
  date the distribution would have otherwise been made; 

  
	
   

  	
   

  
	
   

  	
            (iii)
  the election must be made at least twelve (12) months before the specified date;
  and

  
	
   

  	
   

  
	
   

  	
            (iv)
  the newly elected specified commencement date may not be beyond the
  Participant’s 70th birthday and no new election may be made after
  the Participant’s 65th birthday.

  



For purposes of elections made under this Section,
installment distributions shall be treated as a single distribution. 


          g)
Permitted Payment Delays. Notwithstanding any provision of this Plan to
the contrary, any distribution to a Participant under the Plan shall be delayed
upon the Committee’s determination that one or more of the following events may
occur:


	
   

  	
   

  
	
   

  	
            (i)
  the making of the payment would violate a term of a loan agreement to which
  the Company is a party, or other similar contract to which the Company is a
  party, and such violation would cause material harm to the Company; or

  
	
   

  	
   

  
	
   

  	
            (ii)
  the making of the payment would violate Federal securities laws or other
  applicable law;

  



provided, that any payment subject to this Section 9(g)
shall ultimately be paid in accordance with Code section 409A.


          h)
Payment Acceleration. If amounts deferred under the Plan must be
included in a Participant’s income under Code section 409A prior to the
scheduled distribution of such amounts, distribution of such amount shall be
made to the Participant.


	
   

  	
   

  
	
  10.

  	
  CHANGE OF CONTROL

  



          Notwithstanding
a Participant’s election or provisions of the Plan to the contrary, upon the occurrence
of a “Change of Control” (as defined in Section 11), all Options and Stock
Units shall fully and immediately vest, and shall be exercisable or paid
pursuant to the terms of the Plan that are otherwise applicable. If the Change
of 


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Control is also a “change in control” as defined under
Code section 409A(a)(2)(A)(v) and official guidance thereunder, all Stock Unit
Accounts shall be distributed in a single payment 30 days following such Change
of Control. 


	
   

  	
   

  
	
  11.

  	
  ADMINISTRATION

  



          The
Plan shall be administered by the Committee. The Committee shall have full
power to interpret the Plan, formulate additional details and regulations for
carrying out the Plan and amend, modify or terminate the Plan as from time to
time it deems proper and in the best interests of the Company, provided that
after a “Change of Control” no amendment, modification of or action to
terminate the Plan may be made which would affect compensation earned or
accrued prior to such amendment, modification or termination without the written
consent of a majority of Participants determined as of the day before a “Change
of Control.” Any decision or interpretation adopted by the Committee shall be
final and conclusive. A “Change of Control” means:


          a)
The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “1934 Act”)) (a “Person”) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the 1934 Act) of voting securities of the Company
where such acquisition causes such Person to own 20% or more of the combined
voting power of the then outstanding voting securities of the Company entitled
to vote generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that for purposes of this subsection (1), the
following acquisitions shall not be deemed to result in a Change of Control: (i)
any acquisition directly from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company or
(iv) any acquisition by any corporation pursuant to a transaction that complies
with clauses (i), (ii) and (iii) of subsection (3) below; and provided,
further, that if any Person’s beneficial ownership of the Outstanding Company
Voting Securities reaches or exceeds 20% as a result of a transaction described
in clause (i) or (ii) above, and such Person subsequently acquires beneficial
ownership of additional voting securities of the Company, such subsequent
acquisition shall be treated as an acquisition that causes such Person to own
20% or more of the Outstanding Company Voting Securities; or


          b)
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 Company’s
shareholders, 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


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          c)
The approval by the shareholders of the Company of a reorganization, merger,
consolidation, sale or other disposition of all or substantially all of the
assets of the Company (“Business Combination”) or, if consummation of such
Business Combination is subject, at the time of such approval by shareholders,
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 (i) all or substantially all of
the individuals and entities who were the beneficial owners of the Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 60% 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 limitation, a corporation that as a
result of such transaction owns the Company or all or substantially all of the
Company’s assets 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 Company Voting Securities, (ii) no
Person (excluding any employee benefit plan (or related trust) of the Company
or such corporation resulting from such Business Combination) beneficially
owns, directly or indirectly, 20% 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 (iii) 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


          d)
Approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company.


	
   

  	
   

  
	
  12.

  	
  GOVERNING LAW

  



          The
validity, construction and effect of the Plan and any such actions taken under
or relating to the Plan shall be determined in accordance with the laws of the
State of Delaware and applicable Federal law.


	
   

  	
   

  
	
  13.

  	
  NOTICES

  



          Unless
otherwise notified, all notices under this Plan shall be sent in writing to the
Company, attention Corporate Compensation, P.O. Box 1113, Minneapolis,
Minnesota 55440. All correspondence to the Participants shall be sent to the
address which is their recorded address as listed on the election forms.


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  14.

  	
  PLAN TERMINATION

  



          Upon
termination of the Plan, distribution of Deferred Compensation Accounts and
Stock Unit Accounts shall be made as described in Section 9, unless the Committee
determines in its sole discretion that all such amounts shall be distributed
upon termination in accordance with the requirements under Code section 409A. 


	
   

  	
   

  
	
  15.

  	
  COMPLIANCE WITH CODE SECTION 409A

  



          It is
intended that this Plan shall comply with the provisions of Code section 409A
and the Treasury regulations relating thereto so as not to subject the Participants
to the payment of additional taxes and interest under Code section 409A. In
furtherance of this intent, this Plan shall be interpreted, operated and administered
in a manner consistent with these intentions.



















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