Starbucks 2004 Annual Report Download - page 26

Fiscal 2004 Annual Report 37
As of October 3, 2004, there were 21.1 million shares of common stock available for issuance pursuant to future stock option grants.
Additional information regarding options outstanding as of October 3, 2004, is as follows:
Options Outstanding Options Exercisable
Weighted
Average Weighted Weighted
Remaining Average Average
Range of Contractual Exercise Exercise
Exercise Prices Shares Life (Years) Price Shares Price
$ 4.14 – $ 9.20 6,115,368 2.33 $ 8.16 6,115,368 $ 8.16
9.21 – 14.80 9,934,624 5.66 12.99 9,062,892 12.81
15.51 – 20.19 5,046,033 6.17 19.77 4,600,521 19.88
20.25 – 30.25 9,072,745 7.84 21.46 4,866,404 21.24
30.46 – 46.02 8,247,840 9.17 31.32 2,043,930 30.46
$ 4.14 – $ 46.02 38,416,610 6.47 $ 19.05 26,689,115 $ 15.85
Employee Stock Purchase Plans
The Company has an employee stock purchase plan which
provides that eligible employees may contribute up to 10%
of their base earnings toward the quarterly purchase of the
Company’s common stock. The employee’s purchase price
is 85% of the lesser of the fair market value of the stock on
the fi rst business day or the last business day of the quarterly
offering period. Employees may purchase shares having a fair
market value of up to $25,000 (measured as of the fi rst day
of each quarterly offering period for each calendar year). No
compensation expense is recorded in connection with the plan.
The total number of shares issuable under the plan is 16.0
million. There were 979,592 shares issued under the plan during
fi scal 2004 at prices ranging from $21.53 to $37.93. There were
712,046 shares issued under the plan during fi scal 2003 at prices
ranging from $17.32 to $20.87. There were 991,742 shares issued
under the plan during fi scal 2002 at prices ranging from $12.58
to $19.81. Since inception of the plan, 6.6 million shares have
been purchased, leaving 9.4 million shares available for future
issuance. Of the 54,623 employees eligible to participate, 14,253
were participants in the plan as of October 3, 2004.
Starbucks has an additional employee stock purchase plan that
allows eligible U.K. employees to save toward the purchase of
the Company’s common stock. The employee’s purchase price
is 85% of the fair value of the stock on the fi rst business day of
a three-year offering period. No compensation expense was
recorded in connection with the plan during fi scal years 2004,
2003 or 2002. The total number of shares issuable under the
plan is 600,000. There were 4,480 shares issued under the plan
during fi scal 2004 at prices ranging from $14.13 to $18.95.
There were 31,294 shares issued under the plan during fi scal
2003 at prices ranging from $11.33 to $12.02. No shares had
been issued prior to fi scal 2003 and 564,226 shares remain
available for future issuance. During fi scal 2004, the Company
suspended future offerings under this employee stock purchase
plan, with the last offering made in December 2002 and
maturing in February 2006. A new employee stock purchase
plan, the UK Share Incentive Plan, was introduced during
fi scal 2004 and will allow eligible U.K. employees to purchase
shares of common stock through payroll deductions during
six-month offering periods, at the lesser of the fair market
value of the stock at the beginning or end of the offering
period. The Company will award one matching share for each
six shares purchased under the plan. The total number of
shares issuable under the plan is 700,000, of which no shares
were issued as of October 3, 2004.
Deferred Stock Plan
Starbucks has a deferred stock plan for certain key employees that
enables participants in the plan to defer receipt of ownership of
common shares from the exercise of nonqualifi ed stock options.
The minimum deferral period is fi ve years. As of October 3,
2004, receipt of 1,697,100 shares was deferred under the terms
of this plan. The rights to receive these shares, represented by
common stock units, are included in the calculation of basic and
diluted earnings per share as common stock equivalents.
Defi ned Contribution Plans
Starbucks maintains voluntary defi ned contribution plans
covering eligible employees as defi ned in the plan documents.
Participating employees may elect to defer and contribute a
portion of their compensation to the plans up to limits stated
in the plan documents, not to exceed the dollar amounts set by
applicable laws. For employees in the United States and Canada,
the Company matched 25% to 150% of each employee’s eligible
contribution based on years of service, up to a maximum of the
fi rst 4% of each employee’s compensation.
The Company’s matching contributions to all plans were
approximately $9.8 million, $6.8 million and $3.1 million in
fi scal years 2004, 2003 and 2002, respectively.