RULES OF THE STARBUCKS UK SHARE INCENTIVE PLAN

Stock Option Agreement

You are currently viewing:

This Stock Option Agreement involves

STARBUCKS CORP

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.

Title: RULES OF THE STARBUCKS UK SHARE INCENTIVE PLAN
Governing Law: Washington Date: 3/31/2004
Industry: Restaurants Sector: Services

RULES OF THE STARBUCKS UK SHARE INCENTIVE PLAN, Parties: starbucks corp

<PAGE>

EXHIBIT 10.1

RULES OF THE STARBUCKS UK SHARE INCENTIVE PLAN

1 INTERPRETATION

1.1 In the Rules, unless the context otherwise requires, the following

words and expressions have the following meanings:

ACCUMULATION PERIOD a period determined at the discretion of

the Company, not exceeding 12 months

which must be the same for all

individuals entering into Partnership

Shares Agreements;

APPROPRIATE to confer a beneficial interest in

Matching Shares on a Participant, subject

to the provisions of the Plan, and the

expressions "Appropriation" and

"Appropriated" shall be construed

accordingly;

ASSOCIATE the meaning set out in paragraphs 22, 23

and 24 of Schedule 2;

ASSOCIATED COMPANY in relation to two companies if:

(a) one company has control of the

other; or

(b) both are under the control of the

same person or persons;

and for the purposes of this definition,

"control" has the meaning set out in

section 416(2) to (6) ICTA 1988;

AWARD the award to Participants of Partnership

Shares or Matching Shares in accordance

with the Plan and "Awarded" shall be

construed accordingly;

CAPITAL RECEIPT a receipt by the Trustee of money or

money's worth of the type defined in

section 502 ITEPA 2003;

CLOSE COMPANY the meaning set out in section 414 ICTA

1988 as modified by paragraph 20 of

Schedule 2;

<PAGE>

COMPANY Starbucks Corporation, incorporated under

the laws of the State of Washington,

United States of America;

CONNECTED COMPANY (a) a company which Controls or is

Controlled by the Company or which

is controlled by a company which

also Controls the Company; or

(b) a company which is a member of a

Consortium owning the Company or

which is owned in part by the

Company as a member of the

Consortium;

CONSORTIUM the meaning set out in section 99(3) of

Schedule 2;

CONTROL the meaning set out in section 840 ICTA

1988;

DIRECTORS the board of directors of the Company or

a duly authorised committee thereof;

ELIGIBLE PARTNER (a) an individual who in the case of

Partnership Shares or Matching

(i) if there is no Accumulation

Period, at the time the money for

the acquisition of such

Partnership Shares is deducted;

and

(ii) if there is an Accumulation

Period, at the time of the first

deduction of money for the

acquisition of such Partnership

in either case:

(aa) is an employee of a

Participating Company;

(ab) has been such an employee

(or has otherwise been an

employee of a Qualifying

Company) at all times

during any Qualifying

Period;

(2)

<PAGE>

(ac) has earnings in respect of

his office or employment

with a Participating

Company which are (or would

be if there were any)

general earnings to which

section 15 or 21 of ITEPA

2003 applies;

(ad) has not either himself or

through any Associate and

whether in either case

alone or together with one

or more Associates has not

had within the preceding 12

months, a Material Interest

in a Close Company whose

shares may be Appropriated

or acquired under the Plan

or a company which has

Control of such a company

or is a member of a

Consortium which owns such

a company; and

(ae) does not at the same time

participate in a share

incentive plan approved

under Schedule 2 (other

than the Plan) established

by the Company or a

Connected Company (which

for the avoidance of doubt

shall include where an

employee would have

participated but for his

failure to obtain a

performance allowance);

(b) an individual who at the relevant

time satisfies the requirements at

(a) above, excluding (ac), whom the

Company has, in its absolute

discretion, determined should be

included;

EMPLOYEES' SHARE SCHEME the meaning set out in section 743 of the

Companies Act 1985;

EMPLOYER COMPANY the Participating Company which employs

an Eligible Partner or, if a Participant

is no longer an Eligible Partner, the

company which employs the

(3)

<PAGE>

Participant (or last employed the

Participant) in Relevant Employment so

long as that company is one to which PAYE

regulations apply at that time;

EXCHANGE RATE for any day means the closing mid-point

spot rate UK Pound against the US Dollar

for that day, as quoted by the Financial

Times newspaper;

FORFEITURE PERIOD the period(s) determined by the Company

pursuant to Rule 9.2.5 or 9.2.6, as

appropriate, provided that the period(s)

shall not exceed 3 years from the

relevant date of Appropriation;

ICTA 1988 the Income and Corporation Taxes Act

1988;

INITIAL MARKET VALUE the Market Value of a Matching Share on

the Matching Shares Appropriation Date;

ITEPA 2003 the Income Tax (Earnings and Pensions)

Act 2003;

MARKET VALUE (a) on any date, (if agreed for the

purposes of the Plan with Inland

Revenue Shares Valuation on or

before that day) the regular

trading session closing price of a

Share on that day as reported by

The Nasdaq Stock Market, Inc.

converted into UK Pounds at the

Exchange Rate for that date; or

(b) if on that date the shares are not

traded on Nasdaq, the market value

of a Share as determined in

accordance with the provisions of

Part VIII TCGA 1992 and paragraph

92 of Schedule 2 and agreed for the

purposes of the Plan with Inland

Revenue Shares Valuation on or

before that day;

MATCHING SHARES Shares entitlement to which is as set out

in Part II which shall:

(a) be shares of the same class and

carry the same rights as the

Partnership Shares to which they

relate;

(4)

<PAGE>

(b) be Appropriated on the same day as

the Partnership Shares to which

they relate are acquired; and

on exactly the same basis;

MATCHING SHARES the date on which the Trustee

APPROPRIATION DATE Appropriates an Award of Matching Shares;

MATCHING SHARES HOLDING the period beginning on the Matching

PERIOD Shares Appropriation Date and ending on a

date determined from time to time at the

discretion of the Company, and being not

earlier than the third anniversary nor

later than the fifth anniversary of the

Matching Shares Appropriation Date or, if

earlier, the date on which the

Participant ceases to be in Relevant

Employment, and which period shall be the

same for all Matching Shares comprised in

the same Award and shall not be increased

at any time in respect of Matching Shares

already Appropriated;

MATERIAL INTEREST the meaning set out in paragraphs 19 to

21 of Schedule 2;

PARTICIPANT an Eligible Partner to whom the Trustee

has made an Appropriation or on whose

behalf Partnership Shares have been

acquired or, where the context permits,

an individual who has submitted a duly

completed Partnership Shares Agreement in

accordance with Rule 4.3.5;

PARTICIPATING COMPANY any Subsidiary which is a party to the

Trust Deed or has pursuant to clause 9

executed a deed of adherence and to which

the Plan continues to extend;

PARTNERSHIP SHARES Shares entitlement to which is as set out

in Part I;

(5)

<PAGE>

PARTNERSHIP SHARES the date determined by the Trustee in

ACQUISITION DATE accordance with Rule 4.3.4;

PARTNERSHIP SHARES an agreement issued by the Company under

AGREEMENT Rule 4.4;

PARTNERSHIP SHARES the date specified in the Partnership

CLOSING DATE Shares Invitation by which the completed

Partnership Shares Agreement must be

received by the Trustee;

PARTNERSHIP SHARES an invitation issued by the Company under

INVITATION Rule 4;

PARTNERSHIP SHARES in the case of a Partnership Shares

MARKET VALUE Agreement with:

(a) an Accumulation Period, the lower

of the Market Value of a Share on:

(i) the first day of the

Accumulation Period; or

(ii) the Partnership Shares

Acquisition Date;

(b) no Accumulation Period, the Market

Value of a Share on the Partnership

Shares Acquisition Date;

PARTNERSHIP SHARES MONEY the meaning given to that term by Rule

4.5.2;

PLAN the Starbucks UK Share Incentive Plan as

constituted by the Trust Deed and the

Rules in their present form or as amended

from time to time;

PLAN SHARES Partnership Shares and Matching Shares

which have been Appropriated to, or

acquired on behalf of, a Participant or

are held on his behalf by the Trustee;

QUALIFYING COMPANY the meaning set out in paragraph 17 of

Schedule 2;

QUALIFYING CORPORATE BOND the meaning set out in section 117 TCGA

1992;

(6)

<PAGE>

QUALIFYING PERIOD a period determined by the Company in

relation to any Award of Shares under the

Plan which may be different for different

Awards provided that:

(a) in the case of Partnership Shares

and Matching Shares where there is

an Accumulation Period it shall not

exceed the period of 6 months

before the beginning of the

Accumulation Period;

(b) in the case of Partnership Shares

and Matching Shares where there is

no Accumulation Period it shall not

exceed the period of 18 months

before the deduction of money for

the acquisition of the Partnership

Shares;

RELEVANT AMOUNT in respect of Partnership Shares, in any

Year of Assessment, the lower of:

(i) L1,500; and

(ii) 10% of Salary

subject in each case to such amendment as

may be made to any one of more of those

limits as contained in ITEPA 2003 from

time to time and where in the same Year

of Assessment an Eligible Partner

participates in one or more other share

incentive plans approved under Schedule 2

and established by the Company or a

Connected Company, any shares acquired

under such plans shall be aggregated with

any Shares acquired under the Plan for

the purposes of determining the Relevant

Amount;

RELEVANT EMPLOYMENT employment by the Company or any

Associated Company of the Company;

RETIREMENT AGE the age of 50;

RULES these rules as from time to time amended;

(7)

<PAGE>

SALARY the meaning set out in paragraph 43(4) of

Schedule 2 (subject to the Company

determining that any particular

description of earnings should not be

counted as part of an employee's salary

in accordance with paragraph 46(4A)(b) of

Schedule 2);

SCHEDULE 2 Schedule 2 to ITEPA 2003;

SHARES fully paid shares of common stock of the

Company (or any shares representing the

same) which satisfy the conditions in

paragraphs 26 to 33 inclusive of Schedule

SUBSIDIARY any company over which the Company has

Control;

TCGA 1992 the Taxation of Chargeable Gains Act

1992;

YEAR OF ASSESSMENT a period commencing on 6 April in any

year and ending on 5 April in the

following year.

1.2 In the Plan, unless otherwise specified:

1.2.1 the contents, clause and Rule headings are inserted for ease

of reference only and do not affect the interpretation of the

Plan;

1.2.2 references to clauses, Rules, Parts and the Schedule are

respectively to clauses, rules, parts of, and this schedule to

the Trust Deed;

1.2.3 save as provided for by law and subject to Rule 24.6, a

reference to writing includes any mode of reproducing words in

a legible form and reduced to paper or electronic format or

communication including, for the avoidance of doubt,

correspondence via e-mail;

1.2.4 the singular includes the plural and vice-versa and the

masculine includes the feminine;

1.2.5 a reference to a statutory provision includes any statutory

modification, amendment or re-enactment thereof;

(8)

<PAGE>

1.2.6 the Interpretation Act 1978 applies to the Plan in the same

way as it applies to an enactment; and

1.2.7 unless the context otherwise requires, the definitions set out

in clause 1.1 of the Trust Deed shall apply to the Rules.

2 PURPOSE OF PLAN

The purpose of the Plan is to enable Eligible Partners of Participating

Companies to acquire shares in the Company which give them a continuing

stake in the Company.

3 PARTICIPATION ON SAME TERMS

On each occasion when an Award is to be made, every Eligible Partner or

individual who may be an Eligible Partner for the Award in question

shall be invited to participate in an Award on the same terms and those

who do actually participate must do so on the same terms.

(9)

<PAGE>

PART I - PARTNERSHIP SHARES

4 PARTNERSHIP SHARES INVITATIONS

4.1 ISSUE OF PARTNERSHIP SHARES INVITATIONS

The Company may in its absolute discretion determine that an Award of

Partnership Shares may be made and, accordingly, issue invitations.

4.2 TIMING OF PARTNERSHIP SHARES INVITATIONS

Where Partnership Shares Invitations are to be issued, this must occur

before the commencement of any relevant Accumulation Period.

4.3 CONTENTS OF PARTNERSHIP SHARES INVITATIONS

Partnership Shares Invitations shall be in such form as the Company may

determine from time to time and shall state:

4.3.1 the Partnership Shares Closing Date;

4.3.2 the maximum Salary deduction permitted under the Partnership

Shares Agreement (being the lesser of the Relevant Amount and

such other amount as the Company may determine and specify);

4.3.3 the minimum Salary deduction permitted determined by the

Company which sum must be no greater than L10 on any occasion

(or such other amount as may be permitted from time to time

under paragraph 47 of Schedule 2);

4.3.4 the expected Partnership Shares Acquisition Date being a date

determined by the Trustee and the Company which:

4.3.4.1 where there is no Accumulation Period, shall be

within 30 days after the deduction from Salary

referred to in Rule 4.5.2 is made;

4.3.4.2 where there is an Accumulation Period shall be not

more than 30 days after the end of the Accumulation

Period.

4.3.5 that an Eligible Partner or individual who may be an Eligible

Partner who wishes to accept Partnership Shares under the

Award shall submit to the Trustee, prior to the Partnership

Shares Closing Date, a duly completed Partnership Shares

Agreement;

(10)

<PAGE>

4.3.6 if applicable, the maximum number of Partnership Shares to be

made subject to the Award on this occasion; and

4.3.7 if appropriate, the commencement date (which may not commence

later than the date of the first Salary deduction to be made

under the individual's Partnership Shares Agreement) and

length of the Accumulation Period.

4.4 PARTNERSHIP SHARES AGREEMENT AND PARTNERSHIP SHARES INVITATION

Each Eligible Partner or individual who may be an Eligible Partner for

the Award in question who does not already have in force a Partnership

Shares Agreement in respect of the relevant Award of Partnership Shares

shall be sent a Partnership Shares Agreement in respect of the relevant

Award of Partnership Shares.

4.5 CONTENTS OF PARTNERSHIP SHARES AGREEMENT

A Partnership Shares Agreement shall be in such form as the Company may

determine from time to time and shall:

4.5.1 set out a notice in the form prescribed by regulations

pursuant to paragraph 48 of Schedule 2;

4.5.2 require the individual executing the relevant Partnership

Shares Agreement to state the amount of Salary deduction(s)

and not exceeding the maximum permitted under Rule 4.3.2)

which he wishes to allocate for the purchase of Partnership

Shares under the Partnership Shares Agreement (the

"Partnership Shares Money"); and

4.5.3 state the intervals at which such amounts should be deducted;

and

4.5.4 state whether any excess amount remaining after the

acquisition of Partnership Shares will be:

4.5.4.1 paid over to the Participant subject to the Trustee

complying with Rule 19; or

4.5.4.2 with the agreement of the Participant, retained by

the Trustee and added to the next Accumulation Period

or where there is no next Accumulation Period,

retained by the Trustee and added to the next Salary

deduction; and

(11)

<PAGE>

4.5.5 state the commencement date (which may not commence later than

the date of the first Salary deduction to be made under the

Eligible Partner's Partnership Shares Agreement) and length of

the Accumulation Period, if applicable.

4.6 AGREEMENT MAY BE WITHDRAWN

A Partnership Shares Agreement shall take effect in relation to any

Award of Partnership Shares until such time as a Participant notifies

the Employer Company that he no longer wishes to so participate.

4.7 EXCESS SALARY DEDUCTIONS

Any amounts deducted in excess of the amounts permitted must be paid

over to the Participant as soon as practicable.

4.8 SCALING DOWN

If the number of Partnership Shares for which applications have been

received is in excess of any maximum specified in accordance with Rule

4.3.6 the amount of deduction of Partnership Shares Money specified by

each Participant shall be reduced pro rata. For the purpose of this

Rule 4.8, the number of Partnership Shares for which applications have

been received shall be:

4.8.1 where there is not an Accumulation Period, the total amount to

be deducted during the month divided by the Market Value on

the first day of the month; and

4.8.2 where there is an Accumulation Period, the total amount

expected to be deducted during the Accumulation Period

(assuming no instructions are received from Participants under

Rule 5) divided by the Market Value on the first day of the

Accumulation Period.

4.9 PARTNERSHIP SHARES MONEY HELD FOR PARTICIPANT

Partnership Shares Money must, subject to Rules 5.4 and 8.2, be:

4.9.1 paid to the Trustee as soon as practicable; and

4.9.2 held by the Trustee on behalf of a Participant with:

4.9.2.1 a person falling within section 840A (1) (b) of ICTA

1988;

4.9.2.2 a building society; or

(12)

<PAGE>

4.9.2.3 a firm falling within section 840A(1)(c) of ICTA

1988;

until it is used to acquire Partnership Shares on behalf of the

Participant from whose Salary the Partnership Shares Money has been

deducted.

4.10 INTEREST ON PARTNERSHIP SHARES MONEY

The Trustee must account to the Participant from whose Salary the

Partnership Shares Money had been deducted, for any interest received

on Partnership Shares Money held on his behalf. For the avoidance of

doubt there is no obligation on the Trustee to arrange for any

Partnership Shares Money to be deposited in an interest bearing

account.

Any Trustee which is a bank or building society shall, notwithstanding

any benefit which may accrue to it as a result, itself be entitled to

hold Partnership Shares Money in a designated account in its capacity

as a bank or building society and not be obliged to account for any

resultant profit.

5 INSTRUCTIONS GIVEN DURING ACCUMULATION PERIOD

5.1 VARIATION OF SALARY DEDUCTIONS AND INTERVALS

Subject to Rules 4.3.2, 4.3.3, and 4.3.6, and notwithstanding Rule

4.5.6 a Participant may, with the prior agreement of the Employer

Company, vary the amount and or the intervals of the Salary deduction

authorised under his Partnership Shares Agreement.

5.2 NOTICE TO SUSPEND SALARY DEDUCTIONS

A Participant may, at any time, direct the Employer Company by notice

in writing to:

5.2.1 suspend the making of Salary deductions; or

5.2.2 recommence the making of Salary deductions

under his Partnership Shares Agreement provided always that:

5.2.3 the Participant may not permit the Employer Company to make

additional Salary deductions to make up for any Salary

deductions which were missed; and

5.2.4 the Participant may only make a direction under Rule 5.2.2

once in any Accumulation Period.

(13)

<PAGE>

5.3 NOTICE TO TERMINATE PARTNERSHIP SHARES AGREEMENT

A Participant may at any time notify the Employer Company in writing

that he wishes to terminate his Partnership Shares Agreement.

5.4 EMPLOYER COMPANY TO GIVE EFFECT TO NOTICES

5.4.1 Where the Employer Company receives a notice to suspend or

terminate deductions under Rule 5.2 or 5.3, it shall (unless a

later date is specified in the notice) within 30 days of

receipt of the notice give effect to the same, and shall:

5.4.1.1 cease all further deductions of Partnership Shares

Money under the Participant's Partnership Shares

Agreement;

5.4.1.2 in the case of a notice under Rule 5.3 subject to

first complying with Rule 19 pay over or, as

applicable, instruct the Trustee to pay over to that

Participant as soon as practicable all Salary

deductions of Partnership Shares Money that have been

made under his Partnership Shares Agreement.

5.4.2 When the Employer Company or the Trustee, as applicable,

receives a notice to recommence Salary deductions under Rule

5.2, the Employer Company shall (unless a later date is

specified in the notice) recommence deductions on the date of

the first deduction due under the Partnership Shares Agreement

following 30 days after receipt of the notice.

5.5 PARTNERSHIP SHARES AGREEMENT TO APPLY TO NEW HOLDING

Where during an Accumulation Period a transaction occurs in relation to

any of the Shares to be acquired under a Partnership Shares Agreement

which results in a new holding of shares being equated with the

original holding for the purposes of capital gains tax and the

Participant gives his consent, the Partnership Shares Agreement shall

have effect following that transaction as if it were an agreement for

the purchase of shares comprised in the new holding. In the context of

a new holding, any reference in this Rule 5.5 to shares includes a

reference to securities and rights of any description which form part

of the new holding for the purpose of Chapter II of Part IV TCGA 1992.

(14)

<PAGE>

6 ACQUISITION OF PARTNERSHIP SHARES

6.1 ACQUISITION OF SHARES BY TRUSTEE (NO ACCUMULATION PERIOD)

After the deduction of Partnership Shares Money the Trustee shall

calculate the number of Partnership Shares to be acquired on behalf of

each Participant by dividing (as nearly as possible) each Participant's

Partnership Shares Money deducted under his Partnership Shares

Agreement by the Partnership Shares Market Value and shall acquire such

Shares on behalf of Participants within 30 days of such deduction

PROVIDED THAT if the number of Partnership Shares to be acquired would

exceed the maximum specified under Rule 4.3.6, the number of

Partnership Shares acquired on behalf on each Participant shall be

reduced proportionately.

6.2 ACQUISITION OF SHARES BY TRUSTEE (WITH ACCUMULATION PERIOD)

6.2.1 After the expiry of the Accumulation Period the Trustee shall

calculate the number of Partnership Shares to be acquired on

behalf of each Participant by dividing (as nearly as possible)

each Participant's aggregate Partnership Shares Money deducted

under his Partnership Shares Agreement during the Accumulation

Period

SITE SEARCH

AGREEMENTS / CONTRACTS

CLAUSES

Search Contract Clauses >>

Browse Contract Clause Library>>

Get Email Updates