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estimated at the date of grant based on the Company’s historical experience and future expectations. Prior to the adoption
of SFAS 123R, the effect of forfeitures on the pro forma expense amounts was recognized as the forfeitures occurred.
The following summarizes all stock option transactions from September 28, 2003, through October 1, 2006 (no
restricted stock, restricted stock units or stock appreciation rights were outstanding for any of these periods):
Shares Subject to
Options
Weighted Average
Exercise Price
per Share
Weighted Average
Remaining
Contractual Life
Aggregate
Intrinsic Value
(In thousands)
Outstanding, September 28, 2003 78,130,892 $ 7.74 6.7 $550,420
Granted 18,435,240 15.62
Exercised (15,416,982) 7.11
Cancelled (4,315,930) 11.88
Outstanding, October 3, 2004 76,833,220 9.52 6.5 1,082,324
Granted 15,627,550 27.17
Exercised (16,169,992) 8.08
Cancelled (3,831,872) 17.86
Outstanding, October 2, 2005 72,458,906 13.22 6.3 857,319
Granted 13,357,095 30.52
Exercised (13,222,729) 9.02
Cancelled (3,173,401) 24.51
Outstanding, October 1, 2006 69,419,871 16.83 6.2 1,196,209
Exercisable, October 1, 2006 49,203,321 12.56 5.3 1,057,584
The aggregate intrinsic value in the table above is before applicable income taxes and represents the amount optionees
would have received if all options had been exercised on the last business day of the period indicated, based on the
Company’s closing stock price. As of October 1, 2006, total unrecognized stock-based compensation expense related to
nonvested stock options was approximately $72 million, before income taxes, and is expected to be recognized over a
weighted average period of approximately 22 months. During the fiscal year ended October 1, 2006, the total intrinsic
value of stock options exercised was $327 million. During the fiscal year ended October 1, 2006, the total fair value of
options vested was $95 million.
The Company issues new shares of common stock upon exercise of stock options.
As of October 1, 2006, there were 62.3 million shares of common stock available for issuance pursuant to future stock
option grants. Additional information regarding options outstanding as of October 1, 2006, is as follows:
Range of Exercise Prices Shares
Weighted Average
Remaining
Contractual
Life (Years)
Weighted Average
Exercise Price Shares
Weighted Average
Exercise Price
OPTIONS OUTSTANDING OPTIONS EXERCISABLE
$ 3.96 – $ 7.40 16,185,466 2.7 $ 5.76 16,185,466 $ 5.76
7.76 – 10.96 14,067,683 5.3 10.25 13,757,120 10.23
11.00 – 19.60 14,020,218 6.9 14.92 11,499,384 14.76
20.99 – 30.20 13,437,687 8.2 27.00 6,661,116 27.10
30.28 – 37.86 11,708,817 9.1 30.67 1,100,235 30.42
69,419,871 6.2 16.83 49,203,321 12.56
Employee Stock Purchase Plans
The Company has an employee stock purchase plan allowing eligible employees to 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 first business day or the last business day of the quarterly offering period.
60 STARBUCKS CORPORATION, FORM 10-K