General Mills (GIS)

(3) Restructuring, Impairment, and Other Exit Costs

Restructuring, impairment, and other exit costs (income) were as follows:

During the third quarter of fiscal 2008, we recorded an additional charge of $2.8 million related to previously announced Bakeries and Foodservice segment restructuring actions. This amount consisted entirely of employee severance for 38 employees.

During the nine-month period ended February 24, 2008, we took additional restructuring actions beyond the item described above. We approved a plan to transfer Old El Paso production from our Poplar, Wisconsin facility to other plants and close the Poplar facility to improve capacity utilization and reduce costs. This action affects 113 employees at the Poplar facility and resulted in a charge of $2.7 million consisting entirely of employee severance. Due to declining financial results, we decided to exit our frozen waffle product line (retail and foodservice) and to close our frozen waffle plant in Allentown, Pennsylvania, affecting 111 employees. We recorded a charge of $10.8 million related to this closure, consisting mainly of $3.9 million of employee severance and a $6.2 million non-cash impairment charge against long-lived assets at the plant. We also completed an analysis of the viability of our Bakeries and Foodservice frozen dough facility in Trenton, Ontario, and decided to close the facility, affecting 470 employees. We recorded a $9.8 million charge largely for employee severance expenses and curtailment charges associated with a defined benefit pension plan. These actions, including the anticipated timing of the disposition of the plants we will close, are expected to be completed by February 28, 2009. We also restructured our production scheduling and discontinued our cake product line at our Chanhassen, Minnesota Bakeries and Foodservice plant. These actions affected 125 employees, and we recorded a charge for employee severance of $3.0 million. These actions are expected to be completed by the end of fiscal 2008.

Collectively, the charges we expect to incur with respect to these fiscal 2008 restructuring actions total approximately $73.0 million, of which approximately $50.0 million is expected to be recognized in fiscal 2008. This includes a $17.4 million non-cash charge related to accelerated depreciation on long-lived assets at our Trenton, Ontario plant. The accelerated depreciation charge is recorded in cost of sales in our Consolidated Statements of Earnings and in unallocated corporate expenses in our segment results.

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During the nine-month period ended February 24, 2008, we sold our previously closed Vallejo, California plant and received $10.6 million in proceeds.

In the nine-month period ended February 25, 2007, we sold our previously closed plant in San Adrian, Spain, for proceeds of $9.5 million. We also received net proceeds of $11.7 million from the divestiture of our par-baked bread product line.

(3) Restructuring, Impairment, and Other Exit Costs

Restructuring, impairment, and other exit costs (income) were as follows:

During the second quarter of fiscal 2008, we approved a plan to transfer Old El Paso production from our Poplar, Wisconsin facility to other plants and close the Poplar facility. This action to improve capacity utilization and reduce costs affects 113 employees at the Poplar facility, and resulted in a charge of $2.7 million consisting entirely of employee severance. We anticipate this project will be completed by January 31, 2009.

During the six-month period ended November 25, 2007, we took additional restructuring actions beyond the item described above. Due to declining financial results, we decided to exit our frozen waffle product line (retail and foodservice) and to close our frozen waffle plant in Allentown, Pennsylvania, affecting 111 employees. We recorded a charge of $10.1 million related to this closure, consisting of $3.9 million of employee severance and a $6.2 million non-cash impairment charge against long-lived assets at the plant. We also completed an analysis of the viability of our Bakeries and Foodservice frozen dough facility in Trenton, Ontario, and will close the facility, affecting 470 employees. We recorded an $8.5 million charge for employee severance expenses and curtailment charges associated with a defined benefit pension plan. These actions, including the anticipated timing of the disposition of the plants we will close, are expected to be completed by February 28, 2009. We also restructured our production scheduling and discontinued our cake product line at our Chanhassen, Minnesota Bakeries and Foodservice plant. These actions affected 125 employees, and we recorded a charge for employee severance of $3.0 million. These actions are expected to be completed by the end of fiscal 2008.

Collectively, the total charges we expect to incur with respect to these fiscal 2008 restructuring actions are approximately $70.0 million, of which $48.1 million is expected to be recognized in fiscal 2008. This includes a $17.3 million non-cash second quarter charge related to accelerated depreciation on long-lived assets at our Trenton, Ontario plant, and an additional amount will be recorded in the third quarter prior to the plant’s closure. The accelerated depreciation charges are recorded in cost of sales in our Consolidated Statements of Earnings, and in unallocated corporate expenses in our segment results.

During the six-month period ended November 25, 2007, we sold our previously closed Vallejo, California plant and received $10.6 million in proceeds.

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In the six-month period ended November 26, 2006, we sold our previously closed plant in San Adrian, Spain, for proceeds of $9.5 million. We also received net proceeds of $11.7 million from the divestiture of our par-baked bread product line.