e424b3
The
information contained in this prospectus supplement and the
accompanying prospectus is not complete and may be changed. A
registration statement relating to these securities has become
effective under the Securities Act of 1933, as amended. This
prospectus supplement and the accompanying prospectus are not an
offer to sell nor do they seek an offer to buy these securities
in any jurisdiction where the offer or sale is not permitted.
|
Filed Pursuant to
Rule 424(b)(3)
Registration Number
333-145572
Subject to Completion, Dated
August 20, 2007
Prospectus Supplement to
Prospectus dated August 20, 2007.
$
Starbucks Corporation
% Senior
Notes due 2017
Starbucks is offering
$ % Senior Notes due 2017 (the
notes). Starbucks will pay interest on the notes
on
and
of each year,
commencing ,
2008. The notes will be issued only in minimum denominations of
$2,000 and integral multiples of $1,000 thereof.
Starbucks may redeem the notes in whole or in part prior to
their maturity at any time at the redemption prices described in
Description of Notes Redemption
Optional Redemption of Notes.
See Risk Factors beginning on
page S-4
to read about important factors you should consider before
buying the notes.
Neither the Securities and Exchange Commission nor any other
regulatory body has approved or disapproved of these securities
or passed upon the accuracy or adequacy of this prospectus
supplement or the accompanying prospectus. Any representation to
the contrary is a criminal offense.
|
|
|
|
|
|
|
|
|
|
|
Per
Note
|
|
Total
|
|
Initial public offering price
|
|
|
|
%
|
|
$
|
|
|
Underwriting discount
|
|
|
|
%
|
|
$
|
|
|
Proceeds, before expenses, to
Starbucks
|
|
|
|
%
|
|
$
|
|
|
The initial public offering price set forth above does not
include accrued interest, if any. Interest on the notes will
accrue from August , 2007 and must be paid by
the purchasers if the notes are delivered after
August , 2007. The notes will not be listed on
any securities exchange or included in any automated quotation
system.
The underwriters expect to deliver the notes through the
facilities of The Depository Trust Company for the accounts
of its participants, including Clearstream and the Euroclear
System, against payment in New York, New York on
August , 2007.
Joint
Book-Running Managers
|
Banc
of America Securities
LLC
|
|
Prospectus Supplement dated August , 2007.
ABOUT THIS
PROSPECTUS SUPPLEMENT
You should carefully read this prospectus supplement and the
accompanying prospectus. You should rely only on the information
contained or incorporated by reference in this prospectus
supplement and the accompanying prospectus. We have not
authorized anyone to provide you with different information. If
anyone provides you with different or inconsistent information,
you should not rely on it. We are offering to sell, and seeking
offers to buy, the notes only in jurisdictions where such offers
and sales are permitted. The information contained in this
prospectus supplement and the accompanying prospectus is
accurate only as of the date of this prospectus supplement or
the date of the accompanying prospectus and the information in
the documents incorporated by reference in this prospectus
supplement and the accompanying prospectus is accurate only as
of the date of those respective documents, regardless of the
time of delivery of this prospectus supplement and the
accompanying prospectus or of any sale of the notes. If the
information varies between this prospectus supplement and the
accompanying prospectus, the information in this prospectus
supplement supersedes the information in the accompanying
prospectus.
This prospectus supplement and the accompanying prospectus are
part of a shelf registration statement that we have
filed with the Securities and Exchange Commission, or the SEC.
By using a shelf registration statement, we may sell any
combination of the securities described in the accompanying
prospectus from time to time and in one or more offerings.
Before purchasing any notes, you should carefully read both this
prospectus supplement and the accompanying prospectus, together
with documents incorporated by reference into this prospectus
supplement and the accompanying prospectus and the additional
information described under the heading Where You Can Find
More Information.
Our fiscal year ends on the Sunday closest to September 30.
References in this document to fiscal 2007 refer to our fiscal
year ending September 30, 2007. References to fiscal 2006
refer to our fiscal year ended October 1, 2006 and to
fiscal 2005 refer to our fiscal year ended October 2, 2005.
S-i
PROSPECTUS
SUPPLEMENT SUMMARY
This summary highlights selected information from, or
incorporated by reference in, this prospectus supplement or the
accompanying prospectus, but does not contain all the
information that may be important to you. You should read this
entire prospectus supplement, the accompanying prospectus and
those documents incorporated by reference into this document
carefully, including the Risk Factors and the
financial statements and the related notes, before making an
investment decision.
Starbucks
Corporation
Our principal executive offices are located at 2401 Utah Avenue
South, Seattle, Washington 98134, and our telephone number is
(206) 447-1575.
We maintain a website at
http://www.starbucks.com.
The information on our website is not part of this prospectus
supplement or the accompanying prospectus. Unless the context
requires otherwise, the terms Company,
Starbucks, we, us and
our refer to Starbucks Corporation together with its
subsidiaries.
Overview
We purchase and roast high-quality whole bean coffees and sell
them, along with fresh, rich-brewed coffees, Italian-style
espresso beverages, cold blended beverages, a variety of
complementary food items, coffee-related accessories and
equipment, a selection of premium teas and a line of compact
discs, primarily through company-operated retail stores. We also
sell coffee and tea products and license our trademark through
other channels and, through certain of our equity investees, we
produce and sell ready-to-drink beverages which include, among
others, bottled
Frappuccino®
coffee drinks and Starbucks
DoubleShot®
espresso drinks, and a line of superpremium ice creams. Our
objective is to establish Starbucks as one of the most
recognized and respected brands in the world. To achieve this
goal, we plan to continue rapid expansion of our retail
operations, to grow the activities we conduct outside of our
company-operated retail stores and to selectively pursue other
opportunities to leverage the Starbucks brand through the
introduction of new products and the development of new channels
of distribution. Our brand portfolio includes superpremium
Tazo®
teas, Starbucks Hear
Music®
compact discs, Seattles Best
Coffee®
and Torrefazione
Italia®
coffee.
The
Offering
The following summary is a summary of the notes, and is not
intended to be complete. It does not contain all of the
information that may be important to you. For a more complete
understanding of the notes, please refer to the section entitled
Description of Notes in this prospectus supplement
and the section entitled Description of Debt
Securities in the accompanying prospectus.
|
|
|
Issuer |
|
Starbucks Corporation, a Washington corporation. |
|
Notes Offered |
|
$
aggregate principal amount
of % senior notes due 2017. |
|
Maturity |
|
Unless redeemed earlier, the notes will mature
on ,
2017. |
|
Interest |
|
The notes will bear interest at %
per annum. All interest on the notes will accrue from
August , 2007. |
|
Interest Payment Dates |
|
Interest on the notes will be paid
on
and
of each year,
commencing ,
2008. |
|
Redemption |
|
We may redeem the notes in whole or in part prior to their
maturity at any time at the redemption price described in
Description of
Notes Redemption Optional
Redemption of Notes. |
S-1
|
|
|
Change of Control Triggering Event |
|
Upon the occurrence of a Change of Control Triggering
Event, as defined under Description of
Notes Purchase of Notes upon a Change of Control
Triggering Event, we will be required to make an offer to
repurchase the notes at a price equal to 101% of their aggregate
principal amount, plus accrued and unpaid interest to, but not
including, the date of repurchase. |
|
Ranking |
|
The notes will rank equally in right of payment with all of our
other unsecured senior indebtedness, whether currently existing
or incurred in the future. As of July 1, 2007, we had
$880 million in aggregate principal amount of unsecured
senior indebtedness outstanding. The notes will be senior in
right of payment to our subordinated indebtedness, and will be
effectively junior in right of payment to our secured
indebtedness to the extent of the value of the collateral
securing that indebtedness. The notes will not be guaranteed by
any of our subsidiaries and thus will be effectively
subordinated to any existing or future indebtedness or other
liabilities, including trade payables, of any of our
subsidiaries. |
|
Certain Covenants |
|
The indenture governing the notes contains covenants that, among
other things, will limit our ability to: |
|
|
|
incur, create, assume or guarantee any debt for
borrowed money secured by a lien upon any principal property or
shares of stock or indebtedness of any subsidiary that owns any
principal property;
|
|
|
|
enter into certain sale and lease-back transactions;
and
|
|
|
|
consolidate with or merge into, or transfer or lease
all or substantially all of our assets to, any other party.
|
|
|
|
These covenants are subject to important exceptions and
qualifications that are described under the heading
Description of Notes Certain
Covenants Limitation on Liens,
Limitation on Sale and Lease-Back Transactions and
Limitation on Mergers and Other Transactions
in this prospectus supplement. |
|
Ratings |
|
The notes are rated Baa1 by Moodys Investors Service, Inc.
and BBB+ by Standard & Poors Ratings Services,
in each case with a stable outlook. |
|
Use of Proceeds |
|
We intend to use the net proceeds from the offering to repay
indebtedness outstanding under a 364-day credit facility we
entered into on August 7, 2007 and for other general corporate
purposes, which may include the repayment of our other
indebtedness outstanding from time to time and the repurchase of
our common stock under our ongoing share repurchase program as
updated and approved by our board of directors. |
|
Form and Denomination |
|
The notes will be issued in minimum denominations of $2,000 and
integral multiples of $1,000 thereof. The notes will be
represented by one or more global notes in fully registered form |
S-2
|
|
|
|
|
without interest coupons. The global notes will be deposited
with the trustee as custodian for The Depository
Trust Company, or DTC, and registered in the name of a
nominee of DTC in New York, New York for the accounts of
participants in DTC. Beneficial interests in any of the notes
will be shown on, and transfers will be effected only through,
records maintained by DTC or its nominee and any such interest
may not be exchanged for certificated securities except in
limited circumstances described in this prospectus supplement. |
|
Listing |
|
The notes are not and are not expected to be listed on any
national securities exchange or included in any automated
quotation system. |
|
Trustee, Registrar and Paying Agent |
|
Deutsche Bank Trust Company Americas. |
|
Governing Law |
|
The notes will be governed by, and construed in accordance with,
the laws of the State of New York. |
|
Further Issuances |
|
We may, without notice to or consent of the holders or
beneficial owners of the notes, issue additional notes of the
same series having the same ranking, interest rate, maturity
and/or other terms as the notes offered hereby. |
|
Risk Factors |
|
Your investment in the notes will involve risks. You should
carefully consider all of the information contained in or
incorporated by reference into this prospectus supplement and
the accompanying prospectus as well as the specific factors
under the heading Risk Factors beginning on
page S-4. |
S-3
RISK
FACTORS
Investment in the notes offered pursuant to this prospectus
supplement involves risks. You should carefully consider the
risk factors described below as well as those incorporated by
reference to our most recent Annual Report on
Form 10-K
and our subsequent Quarterly Reports on
Form 10-Q
and the other information contained or incorporated by reference
in this prospectus supplement and the accompanying prospectus.
The occurrence of any of these risks might cause you to lose all
or part of your investment in the notes.
Risks relating to
this offering
Increased
leverage may harm our financial condition and results of
operations.
As of July 1, 2007, we had approximately $2.5 billion
of total liabilities on a consolidated basis, of which
$880 million represented indebtedness under outstanding
commercial paper. On August 7, 2007, we entered into a
$400 million
364-day
credit facility which may be used for general corporate purposes
including repurchases of shares of our common stock. We and our
subsidiaries may incur additional indebtedness in the future
and, subject to limitations on debt for borrowed money secured
by liens on our principal properties or shares of stock or
indebtedness of any subsidiaries that own any principal
properties, the notes do not restrict future incurrence of
indebtedness. This increase and any future increase in our level
of indebtedness will have several important effects on our
future operations, including, without limitation, that:
|
|
|
|
|
we will have additional cash requirements to support the payment
of interest on our outstanding indebtedness;
|
|
|
|
increases in our outstanding indebtedness and leverage may
increase our vulnerability to adverse changes in general
economic and industry conditions, as well as to competitive
pressure;
|
|
|
|
our ability to obtain additional financing for working capital,
capital expenditures, general corporate and other purposes may
be limited; and
|
|
|
|
our flexibility in planning for, or reacting to, changes in our
business and our industry may be limited.
|
Our ability to make payments of principal and interest on our
indebtedness depends on our future performance, which will be
subject to general economic conditions, industry cycles and
financial, business and other factors affecting our consolidated
operations, many of which are beyond our control. If we are
unable to generate sufficient cash flow from operations in the
future to service our debt, we may be required, among other
things:
|
|
|
|
|
to seek additional financing in the debt or equity markets;
|
|
|
|
to refinance or restructure all or a portion of our
indebtedness, including the notes;
|
|
|
|
to sell selected assets;
|
|
|
|
to reduce or delay planned capital expenditures; or
|
|
|
|
to reduce or delay planned operating expenditures.
|
Such measures might not be sufficient to enable us to service
our debt, including the notes. In addition, any such financing,
refinancing or sale of assets might not be available on
economically favorable terms.
S-4
The notes will
be effectively subordinated to the debt of our subsidiaries,
which may limit your recovery.
Our subsidiaries are separate and distinct legal entities and
have no obligation to pay any amounts due pursuant to the notes
or otherwise to make any funds available to us to repay our
obligations, whether by dividends, loans or other payments.
Moreover, our rights to receive assets of any subsidiary upon
its liquidation or reorganization, and the ability of holders of
the notes to benefit indirectly therefrom, will be effectively
subordinated to the claims of creditors of that subsidiary,
including trade creditors.
The notes are
subject to prior claims of any secured creditors, and if a
default occurs, we may not have sufficient funds to fulfill our
obligations under the notes.
The notes are our senior unsecured general obligations, ranking
equally with other senior unsecured indebtedness. The indenture
governing the notes permits us and our subsidiaries to incur
additional secured debt under specified circumstances. If we
incur any secured debt, all or a portion of our assets will be
subject to prior claims by our secured creditors. If our
subsidiaries incur any secured debt, all or a portion of their
assets will be subject to prior claims by their secured
creditors. In the event of our bankruptcy, liquidation,
reorganization, dissolution or other winding up, assets that
secure debt will be available to pay obligations on the notes
only after all debt secured by those assets has been repaid in
full. Holders of the notes will participate in our remaining
assets ratably with all of our other unsecured and senior
creditors, including our trade creditors. If we incur any
additional obligations that rank equally with the notes,
including trade payables, the holders of those obligations will
be entitled to share ratably with the holders of the notes in
any proceeds distributed upon our bankruptcy, liquidation,
reorganization, dissolution or other winding up. This may have
the effect of reducing the amount of proceeds paid to you. If
there are not sufficient assets remaining to pay all these
creditors, all or a portion of the notes then outstanding would
remain unpaid.
We intend to
repurchase our stock, which will reduce cash reserves and
shareholders equity that is available for repayment of the
notes.
We have repurchased, and expect to continue to repurchase, our
common stock in the open market or in privately negotiated
transactions. In the future, we may purchase our common stock
with cash or other of our assets. These purchases may be
significant, and any purchase would reduce cash and
shareholders equity that is available to repay the notes.
The provisions
of the notes will not necessarily protect you in the event of a
highly-leveraged transaction.
The terms of the notes will not necessarily afford you
protection in the event of a highly-leveraged transaction that
may adversely affect you, including a reorganization,
recapitalization, restructuring, merger or other similar
transactions involving us. As a result, we could enter into any
such transaction even though the transaction could increase the
total amount of our outstanding indebtedness, adversely affect
our capital structure or credit rating or otherwise adversely
affect the holders of the notes. These transactions may not
involve a change in voting power or beneficial ownership or
result in a downgrade in the ratings of the notes, or, even if
they do, may not necessarily constitute a change of control
triggering event that affords you the protections described in
this prospectus supplement. If any such transaction should
occur, the value of your notes may decline.
S-5
We have made
only limited covenants in the indenture governing the notes and
these limited covenants may not protect your
investment.
The indenture governing the notes does not:
|
|
|
|
|
require us to maintain any financial ratios or specific levels
of net worth, revenues, income, cash flows or liquidity and,
accordingly, does not protect holders of the notes in the event
that we experience significant adverse changes in our financial
condition or results of operations;
|
|
|
|
limit our subsidiaries ability to incur indebtedness which
would effectively rank senior to the notes;
|
|
|
|
limit our ability to incur indebtedness that is equal in right
of payment to the notes;
|
|
|
|
restrict our ability to repurchase our common stock; or
|
|
|
|
restrict our ability to make investments or to pay dividends or
make other payments in respect of our common stock or other
securities ranking junior to the notes.
|
Furthermore, the indenture governing the notes contains only
limited protections in the event of a change of control and
similar transactions. We could engage in many types of
transactions, such as acquisitions, refinancings or
recapitalizations, that could substantially affect our capital
structure and the value of the notes but may not constitute a
change of control that, upon any resulting downgrade in credit
rating below investment grade, permits holders to require us to
repurchase their notes.
We may not be
able to repurchase all of the notes upon a change of control
triggering event, which would result in a default under the
notes.
We will be required to offer to repurchase the notes upon the
occurrence of a change of control triggering event as provided
in the indenture governing the notes. However, we may not have
sufficient funds to repurchase the notes in cash at such time.
In addition, our ability to repurchase the notes for cash may be
limited by law or the terms of other agreements relating to our
indebtedness outstanding at the time. The failure to make such
repurchase would result in a default under the notes.
Redemption may
adversely affect your return on the notes.
We may choose to redeem the notes at times when prevailing
interest rates are relatively low. As a result, you may not be
able to reinvest the redemption proceeds in a comparable
security at an effective interest rate as high as the notes
being redeemed. Such redemption right of ours also may adversely
impact your ability to sell your notes,
and/or the
price at which you could sell your notes, as the redemption date
approaches.
Changes in our
credit ratings may adversely affect the value of the
notes.
The notes are rated Baa1 by Moodys Investors Service,
Inc. and BBB+ by Standard & Poors Ratings
Services, in each case with a stable outlook. Such ratings are
limited in scope, and do not address all material risks relating
to an investment in the notes, but rather reflect only the view
of each rating agency at the time the rating is issued. Such
ratings are not recommendations to buy, sell or hold the notes.
An explanation of the significance of such rating may be
obtained from such rating agency. There can be no assurance that
such credit ratings will remain in effect for any given period
of time or that such ratings will not be lowered, suspended or
withdrawn entirely by the rating agencies, if, in each rating
agencys judgment, circumstances so warrant. Actual or
anticipated changes or downgrades in our credit ratings,
including any announcement that our ratings are under further
review for a downgrade, are likely to adversely affect the
market value of the notes and could increase our corporate
borrowing costs. In this circumstance, no person or entity is
obliged to provide any additional support or credit enhancement
with respect to the notes.
S-6
There may not
be an active trading market for the notes.
There is no existing market for the notes and we do not intend
to apply for listing of the notes on any securities exchange or
any automated quotation system. Accordingly, there can be no
assurance that a trading market for the notes will ever develop
or will be maintained. Further, there can be no assurance as to
the liquidity of any market that may develop for the notes, your
ability to sell your notes or the price at which you will be
able to sell your notes. Future trading prices of the notes will
depend on many factors, including but not limited to prevailing
interest rates, our financial condition and results of
operations, the then-current ratings assigned to the notes and
the market for similar securities. Any trading market that
develops would be affected by many factors independent of and in
addition to the foregoing, including:
|
|
|
|
|
time remaining to the maturity of the notes;
|
|
|
|
outstanding amount of the notes;
|
|
|
|
the terms related to the optional redemption of the
notes; and
|
|
|
|
level, direction and volatility of market interest rates
generally.
|
USE OF
PROCEEDS
We estimate that the net proceeds of the offering will be
approximately $ million after
deduction of expenses and underwriter discounts. We intend to
use the net proceeds from the offering to repay indebtedness
outstanding under a
364-day
credit facility we entered into on August 7, 2007 and for
other general corporate purposes, which may include the
repayment of our other indebtedness outstanding from time to
time and the repurchase of our common stock under our ongoing
share repurchase program as updated and approved by our board of
directors.
Our 364-day
credit facility allows us to borrow up to $400 million. As
of August 17, 2007, we had no amounts outstanding under our
364-day
credit facility, although we have issued a notice of borrowing
for $100 million that will be funded on August 21,
2007. Amounts outstanding under our
364-day
credit facility are due to be paid in full on August 5,
2008, to the extent not previously repaid with the proceeds of
this offering. The lenders commitments under this the
364-day credit facility will be permanently reduced by the
amount of the net proceeds of this offering.
DESCRIPTION OF
NOTES
The following description of certain material terms of
the % senior notes due 2017
offered hereby does not purport to be complete. This description
adds information to the description of the general terms and
provisions of the debt securities in the accompanying
prospectus. To the extent this summary differs from the summary
in the accompanying prospectus, you should rely on the
description of notes in this prospectus supplement.
The notes will be issued under and governed by an indenture
dated as of August , 2007 (the base
indenture) between us and Deutsche Bank Trust Company
Americas, a New York banking corporation, as trustee (the
trustee), as supplemented by a supplemental
indenture to be entered into between us and the trustee on the
date of issue of the notes (together with the base indenture,
the indenture). The following description is subject
to, and is qualified in its entirety by reference to, the
indenture. Unless otherwise defined herein, capitalized terms
used in the following description are defined in the indenture.
As used in the following description, the terms
Starbucks, we, us,
our and Company refer to Starbucks
Corporation, a Washington corporation, and not any of its
subsidiaries, unless the context requires otherwise.
We urge you to read the indenture (including definitions of
terms used therein) because it, and not this description,
defines your rights as a beneficial holder of the notes. You may
request copies of
S-7
the indenture from us at our address set forth under
Incorporation of Certain Documents by Reference in
the accompanying prospectus.
General
The notes are a series of senior debt securities issued under
the indenture. The trustee will also act as registrar, paying
agent and authenticating agent and perform administrative duties
for us, such as sending out interest payments and notices under
the indenture.
The aggregate principal amount of the notes offered hereby will
initially be
$ ,
and the notes will mature
on ,
2017. The notes will be issued only in fully registered form
without coupons, in minimum denominations of $2,000 with
integral multiples of $1,000 thereof. The notes are general
unsecured senior obligations of Starbucks and will rank equally
in right of payment with all of our other unsecured senior
indebtedness, whether currently existing or incurred in the
future. As of July 1, 2007, we had $880 million in
aggregate principal amount of unsecured senior indebtedness
outstanding. See Description of Certain Other
Indebtedness. The notes will be senior in right of payment
to our subordinated indebtedness, and be effectively junior in
right of payment to our secured indebtedness to the extent of
the value of the collateral securing that indebtedness. The
notes will not be guaranteed by any of our subsidiaries and thus
will be effectively subordinated to any existing or future
indebtedness or other liabilities, including trade payables, of
any of our subsidiaries. The notes are not subject to, and do
not have the benefit of, any sinking fund.
The notes will bear interest at a fixed rate per year
of %, starting on
August , 2007 and ending on their maturity
date. Interest on the notes will be payable semiannually
on
and
of each year, starting
on ,
2008. All payments of interest on the notes will be made to the
persons in whose names the notes are registered on
the
or
next preceding the applicable interest payment date.
Interest on the notes will be calculated on the basis of a
360-day year
comprised of twelve
30-day
months. All dollar amounts resulting from this calculation will
be rounded to the nearest cent.
The notes will initially be evidenced by one or more global
notes deposited with a custodian for, and registered in the name
of, a nominee of DTC. Except as described herein, beneficial
interests in the global notes will be shown on, and transfers
thereof will be effected only through, records maintained by DTC
and its direct and indirect participants. We do not intend to
list the notes on any national securities exchange or include
the notes in any automated quotation systems.
Payments of principal of and interest on the notes issued in
book-entry form will be made as described below under
Book-Entry Delivery and Form
Depositary Procedures. Payments of principal of and
interest on the notes issued in definitive form, if any, will be
made as described below under Book-Entry Delivery
and Form Payment and Paying Agents.
If any interest payment date on a note other than the maturity
date is not a Business Day, such interest payment date will be
postponed to the next succeeding Business Day. If the maturity
date of a note or an interest payment date of a note falls on a
day that is not a Business Day, the related payment of principal
or interest will be made on the next succeeding Business Day as
if made on the date the payment was due. No interest will accrue
on such payment for the period from and after the maturity date
or such interest payment date, as the case may be, to the date
of such payment on the next succeeding Business Day.
We may, without notice to or consent of the holders or
beneficial owners of the notes, issue additional notes of the
same series having the same ranking, interest rate, maturity
and/or other
terms as the notes offered hereby. Any such additional notes
issued would be considered part of the same series of notes
under the indenture as the notes offered hereby.
The indenture does not contain any provisions that would limit
our ability to incur indebtedness or require the maintenance of
financial ratios or specified levels of net worth or liquidity.
S-8
Redemption
Optional
Redemption of Notes
The notes may be redeemed or purchased in whole or in part at
our option at any time prior to the maturity of the notes, at a
price equal to the greater of the following amounts, plus, in
each case, accrued but unpaid interest, if any, thereon to the
date of redemption or purchase (the
Redemption Date):
i. 100% of the aggregate principal amount of the notes to
be redeemed; or
ii. the sum of the present value at such
Redemption Date of (a) the principal amount of such
notes on the Redemption Date plus (b) all required
remaining scheduled interest payments due on such notes (but not
including any portion of such payments of interest accrued to
the Redemption Date) through the maturity date of such
notes computed using a discount rate equal to the Adjusted
Treasury Rate
plus basis
points.
Calculation of the foregoing will be made by us or on our behalf
by such Person as we shall designate; provided, however, that
such calculation shall not be a duty or obligation of the
trustee.
Adjusted Treasury Rate means, with
respect to any Redemption Date, the rate per annum equal to the
semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal
to the Comparable Treasury Price for such Redemption Date.
Comparable Treasury Issue means the
United States Treasury security selected by us as having an
actual or interpolated maturity comparable to the remaining term
of the notes to be redeemed that would be utilized, at the time
of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of the notes.
Comparable Treasury Price means, with
respect to any Redemption Date, (i) the average of the
Reference Treasury Dealer Quotations for such Redemption Date,
after excluding the highest and lowest such Reference Treasury
Dealer Quotations, or (ii) if the trustee is provided fewer
than four such Reference Treasury Dealer Quotations, the average
of all such Reference Treasury Dealer Quotations.
Reference Treasury Dealer means
(i) each of Goldman, Sachs & Co., Banc of America
Securities LLC and Citigroup Global Markets Inc., and their
respective successors; provided, however, that if any of the
foregoing ceases to be a primary U.S. Government securities
dealer in New York City (a Primary Treasury
Dealer), we will substitute another Primary Treasury
Dealer and (ii) any other Primary Treasury Dealer selected
by us.
Reference Treasury Dealer Quotations
means, with respect to each Reference Treasury Dealer and any
Redemption Date, the average of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to us and
the trustee by such Reference Treasury Dealer at 5:00 p.m.
on the third business day preceding such Redemption Date.
Selection and
Notice of Redemption
In the event that we choose to redeem less than all of the
notes, selection of the notes for redemption will be made by the
trustee either:
(i) in compliance with the requirements of the principal
national securities exchange, if any, on which the notes are
listed; or
(ii) if the notes are not so listed, on a pro rata basis,
by lot or by such method as the trustee shall deem fair and
appropriate.
S-9
No notes of a principal amount of $2,000 or less shall be
redeemed in part. Notice of redemption will be mailed by
first-class mail at least 30 but not more than 60 days
before the Redemption Date to each holder of notes to be
redeemed at its registered address. On and after the
Redemption Date, interest will cease to accrue on notes or
portions thereof called for redemption as long as we have
deposited with the paying agent funds in satisfaction of the
applicable redemption price.
Purchase of Notes
upon a Change of Control Triggering Event
Upon the occurrence of a Change of Control Triggering Event,
each holder will have the right to require that we purchase all
or a portion of such holders notes pursuant to the offer
described below (the Change of Control Offer), at a
purchase price equal to 101% of the principal amount thereof
plus accrued interest to the date of purchase.
Within 30 days following the date upon which the Change of
Control Triggering Event occurred, we must send, by first class
mail, a notice to each holder, with a copy to the trustee, which
notice shall govern the terms of the Change of Control Offer.
Such notice shall state, among other things, the purchase date,
which must be no earlier than 30 days nor later than
60 days from the date such notice is mailed, other than as
may be required by law (the Change of Control Payment
Date). Holders electing to have a note purchased pursuant
to a Change of Control Offer will be required to surrender the
note, with the form entitled Option of Holder to Elect
Purchase on the reverse of the note completed, to the
paying agent at the address specified in the notice prior to the
close of business on the third Business Day prior to the Change
of Control Payment Date.
If a Change of Control Offer is made, we cannot assure you that
we will have available funds sufficient to pay the Change of
Control purchase price for all the notes that might be delivered
by holders seeking to accept the Change of Control Offer. In the
event we are required to purchase outstanding notes pursuant to
a Change of Control Offer, we expect that we would seek third
party financing to the extent we do not have available funds to
meet our purchase obligations. However, we cannot assure you
that we would be able to obtain such financing.
Neither our board of directors nor the trustee may waive the
covenant relating to a holders right to redemption upon
the occurrence of a Change of Control Triggering Event.
Restrictions in the indenture described herein on the ability of
us and our subsidiaries to incur additional indebtedness secured
by a lien on our principal properties or shares of stock or
indebtedness of our subsidiaries that own principal properties
may also make more difficult or discourage a takeover of us,
whether favored or opposed by our management. Consummation of
any such transaction in certain circumstances may require
redemption or repurchase of the notes, and we cannot assure you
that we or the acquiring party will have sufficient financial
resources to effect such redemption or repurchase. Such
restrictions may, in certain circumstances, make more difficult
or discourage any leveraged buyout of us or any of our
subsidiaries by our management. While such restrictions cover a
wide variety of arrangements that have traditionally been used
to effect highly leveraged transactions, the indenture may not
afford the holders of the notes protection in all circumstances
from the adverse aspects of a highly leveraged transaction,
reorganization, recapitalization, restructuring, merger or
similar transaction.
We will comply with the requirements of
Rule 14e-1
under the Exchange Act and any other securities laws and
regulations thereunder to the extent such laws and regulations
are applicable in connection with the repurchase of notes
pursuant to a Change of Control Offer. To the extent that any
securities laws or regulations conflict with the Change of
Control Triggering Event provisions of the indenture, we
shall comply with the applicable securities laws and regulations
and shall not be deemed to have breached our obligations under
the Change of Control Triggering Event provisions of
the indenture by virtue thereof.
S-10
Certain
Covenants
The indenture will contain the following covenants:
Limitation on
Liens
(a) We will not (nor will we permit any subsidiary to)
issue, incur, create, assume or guarantee any Funded Debt
secured by a mortgage, deed of trust, security interest, pledge,
lien, charge or other encumbrance (collectively, a
mortgage) upon any Principal Property or upon any
shares of stock or indebtedness of any subsidiary that owns any
Principal Property (whether such Principal Property, shares or
indebtedness are now existing or owed or hereafter created or
acquired) without in any such case effectively providing,
concurrently with the issuance, incurrence, creation, assumption
or guaranty of any such Funded Debt, or the grant of such
mortgage, that the notes (together with, if we shall so
determine, any other indebtedness of or guaranty by us or such
subsidiary ranking equally with the notes) shall be secured
equally and ratably with (or, at our option, prior to) such
secured Funded Debt; provided that any mortgage created for the
benefit of holders of the notes pursuant to this provision shall
provide by its terms that such mortgage shall be automatically
and unconditionally released and discharged upon the release and
discharge of the mortgage that resulted in such provision
becoming applicable. The foregoing restriction, however, will
not apply to, and there will be excluded from any computation
under clause (b) below and under paragraph (b) of the
covenant described below under the caption
Limitation on Sale and Lease-Back Transactions, each of
the following:
(1) mortgages on property, shares of stock or indebtedness
or other assets of any person existing at the time such person
becomes a subsidiary;
(2) mortgages on property, shares of stock or indebtedness
or other assets existing at the time of acquisition thereof by
us or a subsidiary, or mortgages thereon to secure the payment
of all or any part of the purchase price thereof or the cost of
construction, installation, renovation, improvement or
development thereon or thereof, or mortgages on property, shares
of stock or indebtedness or other assets to secure any debt
incurred or guaranteed prior to, at the time of, or within
360 days after, the latest of the acquisition thereof or,
in the case of property, the completion of such construction,
installation, renovation, improvement or development or the
commencement of substantial commercial operation of such
property for the purpose of financing all or any part of the
purchase price thereof, such construction, installation,
renovation, improvement or development;
(3) mortgages in favor of us or a subsidiary to secure
Funded Debt owing to us or to a subsidiary;
(4) mortgages existing at the date of the initial issuance
of the notes;
(5) mortgages on property, shares of stock or indebtedness
or assets of a person existing at the time such person is merged
into or consolidated with Starbucks or a subsidiary or at the
time of a sale, lease or other disposition of the properties of
such person as an entirety or substantially as an entirety to us
or a subsidiary;
(6) mortgages in favor of the United States of America or
any state, territory or possession thereof (or the District of
Columbia), any foreign government, or any department, agency,
instrumentality or political subdivision of the United States of
America or any state, territory or possession thereof (or the
District of Columbia) or any foreign government, to secure
partial, progress, advance or other payments pursuant to any
contract or statute or to secure any indebtedness incurred or
guaranteed for the purpose of financing all or any part of the
purchase price or the cost of constructing or improving the
property subject to such mortgages (including, but not limited
to, mortgages incurred in connection with pollution control or
industrial revenue bonds or similar financing);
S-11
(7) mortgages created in connection with a project financed
with, and created to secure, a Nonrecourse Obligation; or
(8) extensions, renewals, refundings, or replacements, in
whole or in part, of any mortgage referred to in the foregoing
clauses; provided, however, that (i) the principal amount
of Funded Debt secured thereby shall not exceed the principal
amount of Funded Debt, plus any premium or fee payable in
connection with any such extension, renewal, refunding or
replacement, so secured at the time of such extension, renewal,
refunding, or replacement and (ii) such extension, renewal,
refunding or replacement mortgages will be limited to all or
part of the same property, shares of stock or indebtedness or
assets and improvement or development thereon or thereof which
secured the indebtedness so secured at the time of such
extension, renewal, refunding or replacement.
(b) Notwithstanding the restrictions in the first sentence
of the preceding paragraph, we or any subsidiary of ours may
issue, incur, create, assume or guarantee Funded Debt secured by
a mortgage which would otherwise be subject to such
restrictions, without equally and ratably securing the notes,
provided that after giving effect thereto, the aggregate amount
of all Funded Debt so secured by mortgages (not including Funded
Debt secured by mortgages permitted under clauses (1)
through (8) of the second sentence of paragraph
(a) above) plus the aggregate amount of all Attributable
Debt in respect of Sale and Lease-Back Transactions relating to
Principal Properties (excluding any Attributable Debt permitted
to be incurred pursuant to clauses (1) through (8) of
paragraph (b) of the covenant described below under the
caption Limitation on Sale and Lease-Back
Transactions) does not exceed 15% of our Consolidated Net
Tangible Assets.
Limitation on
Sale and Lease-Back Transactions
(a) We will not, nor will we permit any subsidiary to,
enter into any Sale and Lease-Back Transaction with respect to
any Principal Property. The foregoing restriction, however, will
not apply to, and there will be excluded from any computation
under clause (b) below and under paragraph (b) of the
covenant described above under the caption
Limitation on Liens, any Sale and Lease-Back Transaction
if:
(1) we or a subsidiary are permitted to create Funded Debt
secured by a mortgage pursuant to any of clauses (1)
through (8) inclusive under the second sentence of
paragraph (a) of the covenant described above under the
caption Limitation on Liens on the
Principal Property involved in such Sale and Lease-Back
Transaction, in an amount at least equal to the Attributable
Debt with respect to such Sale and Lease-Back Transaction,
without equally and ratably securing the notes;
(2) the proceeds of such Sale and Lease-Back Transaction
are at least equal to the fair market value of the affected
Principal Property (as determined in good faith by our Chief
Executive Officer, President, Chief Financial Officer, Treasurer
or Controller) and we or a subsidiary apply an amount equal to
net proceeds of such Sale and Lease-Back Transaction within
360 days thereof to the prepayment or retirement of debt
for borrowed money of Starbucks or a subsidiary (other than debt
that is subordinated to the notes or debt owed to us or a
subsidiary);
(3) we or a subsidiary apply an amount equal the net
proceeds of such Sale and Lease-Back Transaction within
360 days thereof to the purchase, construction,
development, expansion or improvement of other property;
(4) such Sale and Lease-Back Transaction involves a lease
for a term, including renewals, of not more than three years;
(5) such Sale and Lease-Back Transaction is between us and
one of our subsidiaries, or between subsidiaries;
S-12
(6) such Sale and Lease-Back Transaction is executed at the
time of, or within 12 months after the latest of, the
acquisition, the completion of construction or improvement, or
the commencement of substantial commercial operation, of the
Principal Property covered thereby;
(7) the lease in such Sale and Lease-Back Transaction
secures or relates to industrial revenue or pollution control
bonds if we are permitted to incur a mortgage in connection with
such industrial revenue or pollution control bonds pursuant to
clause (6) of the second sentence of paragraph
(a) under the caption Limitation on
Liens; or
(8) the lease payment in such Sale and Lease-Back
Transaction is created in connection with a project financed
with, and such obligation constitutes, a Nonrecourse Obligation.
(b) Notwithstanding the restrictions in the first sentence
of the preceding paragraph, we or any subsidiary of ours may
enter into any Sale and Lease-Back Transaction with respect to
any Principal Property which would otherwise be subject to such
restrictions, provided that after giving effect thereto, the
aggregate amount of all Attributable Debt with respect to all
such Sale and Lease-Back Transactions (not including any
Attributable Debt permitted to be incurred pursuant to
clauses (1) through (8) of paragraph (a) above)
plus the aggregate amount of all secured Funded Debt incurred
pursuant to paragraph (a) under the covenant described
above under the caption Limitation on Liens
(excluding Funded Debt secured by mortgages permitted by
clauses (1) through (8) of the second sentence of
paragraph (a) thereunder) does not exceed 15% of our
Consolidated Net Tangible Assets.
Limitation on
Mergers and Other Transactions
We may not merge or consolidate with any other person or persons
(whether or not affiliated with us), and we may not sell,
convey, transfer, lease or otherwise dispose of all or
substantially all of our property or assets to any other person
or persons (whether or not affiliated with us), unless we meet
the following conditions:
(1) either (a) the transaction is a merger or
consolidation, and we are the surviving entity; or (b) the
successor person (or the person which acquires by sale,
conveyance, transfer or lease all or substantially all of our
property or assets) is a corporation organized under the laws of
the United States, any state thereof or the District of Columbia
and expressly assumes, by a supplemental indenture satisfactory
to the trustee, all of our obligations under the notes and the
indenture;
(2) immediately after giving effect to the transaction and
treating our obligations in connection with or as a result of
such transaction as having been incurred as of the time of such
transaction, no Event of Default (and no event or condition
which, after notice or lapse of time or both, would become an
Event of Default) shall have occurred and be continuing under
the indenture; and
(3) an officers certificate is delivered to the
trustee to the effect that both of the conditions set forth
above have been satisfied.
In the event of any of the above transactions, if there is a
successor person as described in paragraph (1)(b) immediately
above, then the successor will expressly assume all of our
obligations under the indenture and automatically be substituted
for us in the indenture and as issuer of the notes. Further, if
the transaction is in the form of a sale or conveyance, after
any such transfer (except in the case of a lease), we will be
discharged from all obligations and covenants under the
indenture and all notes issued thereunder.
Events of
Default
Any of the following constitutes an Event of Default with
respect to the notes:
|
|
|
|
|
failure to pay interest on the notes for 90 days after the
payment is due;
|
|
|
|
failure to pay principal or any premium on the notes when due;
|
S-13
|
|
|
|
|
failure to perform any other covenant relating to the notes upon
the receipt by us of notice of such default given as specified
in the Indenture and our failure to cure such default within
90 days after receipt by us of such notice; and
|
|
|
|
certain events of bankruptcy, insolvency and reorganization
affecting the Company or any Material Subsidiary.
|
Defeasance
See Description of Debt Securities Defeasance
of Debt Securities and Certain Covenants in Certain
Circumstances in the accompanying prospectus.
Definitions
Set forth below are certain defined terms used in the indenture.
We refer you to the indenture for a full disclosure of all such
terms, as well as any other capitalized terms used in this
Description of Notes or for which no definition is provided.
Attributable Debt with regard to a
Sale and Lease-Back Transaction with respect to any Principal
Property means, at the time of determination, the lesser of
(A) the present value of the total net amount of lease
payments required to be paid under such lease during the
remaining term thereof (after deducting the amount of rent to be
received under non- cancellable subleases and including any
period for which such lease has been extended), discounted at
the greater of (x) the weighted average interest rate per
annum borne by the notes or (y) the interest rate inherent
in such lease, in each case, as determined by the Chief
Financial Officer, Treasurer or Controller of the Company,
compounded semi-annually, or (B) the sale price for the
Principal Property so sold and leased multiplied by a fraction
the numerator of which is the remaining portion of the base term
of the lease included in such Sale and Lease-Back Transaction
and the denominator of which is the base term of such lease. In
the case of any lease which is terminable by the lessee upon the
payment of a penalty, such net amount shall be the lesser of
(i) the net amount determined assuming termination upon the
first date such lease may be terminated (in which case the net
amount shall also include the amount of the penalty, but shall
not include any rent that would be required to be paid under
such lease subsequent to the first date upon which it may be so
terminated) or (ii) the net amount determined assuming no
such termination.
For purposes of determining such Attributable Debt, lease
payments are the aggregate amount of the rent payable by
the lessee with respect to the applicable period, after
excluding amounts required to be paid on account of maintenance
and repairs, water rates and similar utility charges. If and to
the extent the amount of any lease payment during any future
period is not definitely determinable under the lease in
question, the amount of such lease payment will be estimated in
such reasonable manner as the Chief Financial Officer, Treasurer
or Controller of the Company may in good faith determine.
Below Investment Grade Rating Event
means the notes are rated below an Investment Grade Rating by
each of the Rating Agencies on any date from the date of the
public notice of an arrangement that could result in a Change of
Control until the end of the
60-day
period following public notice of the occurrence of the Change
of Control (which
60-day
period shall be extended so long as the rating of the notes is
under publicly announced consideration for possible downgrade by
any of the Rating Agencies); provided that a Below Investment
Grade Rating Event otherwise arising by virtue of a particular
reduction in rating shall not be deemed to have occurred in
respect of a particular Change of Control (and thus shall not be
deemed a Below Investment Grade Rating Event for purposes of the
definition of Change of Control Triggering Event hereunder) if
the Rating Agencies making the reduction in rating to which this
definition would otherwise apply do not announce or publicly
confirm or inform the trustee in writing at its request that the
reduction was the result, in whole or in part, of any event or
circumstance comprised of or arising as a result of, or in
respect of, the applicable
S-14
Change of Control (whether or not the applicable Change of
Control shall have occurred at the time of the Below Investment
Grade Rating Event).
Capital Stock means:
(1) with respect to any Person that is a corporation, any
and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate
stock, including each class of Common Stock and Preferred Stock
of such Person; and
(2) with respect to any Person that is not a corporation,
any and all partnership, membership or other equity interests of
such Person.
Change of Control means the occurrence
of one or more of the following events:
(1) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or
substantially all of the assets of the Company to any Person or
group of related Persons for purposes of Section 13(d) of
the Exchange Act (a Group), together with any
Affiliates thereof (whether or not otherwise in compliance with
the provisions of the indenture);
(2) the approval by the holders of Capital Stock of the
Company of any plan or proposal for the liquidation or
dissolution of the Company (whether or not otherwise in
compliance with the provisions of the indenture);
(3) any Person or Group shall become the owner, directly or
indirectly, beneficially or of record, of shares representing
more than 50% of the aggregate ordinary voting power represented
by the issued and outstanding Capital Stock of the
Company; or
(4) during any period of 24 consecutive months, a majority
of the members of the board of directors or other equivalent
governing body of the Company cease to be composed of
individuals (i) who were members of that board or
equivalent governing body on the first day of such period, (ii)
whose election or nomination to that board or equivalent
governing body was approved by individuals referred to in
clause (i) above constituting at the time of such election
or nomination at least a majority of that board or equivalent
governing body or (iii) whose election or nomination to
that board or other equivalent governing body was approved by
individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least
a majority of that board or equivalent governing body
(excluding, in the case of both clause (ii) and clause
(iii), any individual whose initial nomination for, or
assumption of office as, a member of that board or equivalent
governing body occurs as a result of an actual or threatened
solicitation of proxies or consents for the election or removal
of one or more directors by any person or group other than a
solicitation for the election of one or more directors by or on
behalf of the board of directors).
Notwithstanding the foregoing, a transaction will not be deemed
to involve a Change of Control if (i) the Company becomes a
wholly owned subsidiary of a holding company and (ii) the
holders of the voting stock of such holding company immediately
following such transaction are substantially the same as the
holders of the Companys voting stock immediately prior to
such transaction.
Change of Control Triggering Event
means the occurrence of both a Change of Control and a Below
Investment Grade Rating Event.
Common Stock of any Person means any
and all shares, interests or other participations in, and other
equivalents (however designated and whether voting or
non-voting) of, such Persons common stock, and includes,
without limitation, all series and classes of such common stock.
Consolidated Net Tangible Assets
means, as of any date on which we effect a transaction requiring
such Consolidated Net Tangible Assets to be measured hereunder,
the aggregate amount of assets (less applicable reserves) after
deducting therefrom: (a) all current liabilities, except
for current maturities of long-term debt and obligations under
capital leases; and (b) intangible assets, to the
S-15
extent included in said aggregate amount of assets, all as set
forth on our most recent consolidated balance sheet and computed
in accordance with generally accepted accounting principles in
the United States of America applied on a consistent basis.
Credit Agreement means the Credit
Agreement, dated as of August 12, 2005, among the Company,
as borrower, Bank of America, N.A., as administrative agent,
swingline lender and
L/C issuer,
Wachovia Bank, National Association and Citibank, N.A., as
co-documentation agents, Wells Fargo Bank, N.A., as syndication
agent, and the other lenders party thereto, including any
related letters of credit, notes, guarantees, collateral
documents, instruments and agreements executed in connection
therewith, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced from time to time by
one or more credit facilities, in which case, the credit
agreement or similar agreement together with all other documents
and instruments related thereto shall constitute the
Credit Agreement under the indenture, whether with
the same or different agents and lenders.
Funded Debt means indebtedness,
whether or not contingent, for money borrowed (including all
obligations evidenced by bonds, debentures, notes or similar
instruments) owed or guaranteed by the Company or any
consolidated subsidiary, and any of the debt which under
generally accepted accounting principles in the United States of
America would appear as debt on the consolidated balance sheet
of the Company.
Investment Grade Rating means a rating
equal to or higher than Baa3 (or the equivalent) by Moodys
and BBB- (or the equivalent) by S&P.
Material Subsidiary means each
subsidiary of the Company that meets either of the following
tests: (a) its assets equal or exceed 3% of total assets of
the Company and its subsidiaries on a consolidated basis, or
(b) its revenues equal or exceed 3% of the total revenues
of the Company and its subsidiaries on a consolidated basis;
provided that (i) if the subsidiaries that meet either of
the tests in (a) or (b), when combined with revenues
generated or assets owned directly by the Company (excluding any
assets located or revenues generated at the subsidiary level),
aggregate less than 90% of the total assets or total revenues of
the Company and its subsidiaries on a consolidated basis, the
Company shall designate additional subsidiaries to constitute
Material Subsidiaries until such threshold is met, and
(ii) once a Subsidiary is deemed a Material Subsidiary,
whether by virtue of the tests in (a) or (b) above, or
a result of designation pursuant to part (i) of this
proviso, such subsidiary shall continue to constitute a Material
Subsidiary throughout the term of the notes.
Moodys means Moodys
Investors Service, Inc.
Nonrecourse Obligation means
indebtedness or lease payment obligations related to
(i) the acquisition of a Principal Property not previously
owned by the Company or any subsidiary or (ii) the
financing of a project involving the development or expansion of
any Principal Property owned by the Company or any subsidiary,
as to which the obligee with respect to such indebtedness or
obligation has no recourse to the Company or any subsidiary or
any of the Companys or its subsidiaries assets other
than such Principal Property so acquired, developed or expanded,
as applicable.
Person has the meaning set forth in
the Indenture and includes a person as used in
Section 13(d)(3) of the Exchange Act.
Preferred Stock of any Person means
any Capital Stock of such Person that has preferential rights to
any other Capital Stock of such Person with respect to dividends
or redemptions or upon liquidation.
Principal Property means any
individual facility or real property, or portion thereof, owned
or hereafter acquired by us or any subsidiary and located within
the United States of America, which, in the good faith opinion
of our Chief Executive Officer, President, or Chief Financial
Officer, is of material importance to the total business
conducted by us and our subsidiaries taken as a whole,
provided that no such individual facility or property
will deemed of material importance if its gross book value
(excluding
S-16
therefrom any equipment and before deducting accumulated
depreciation) is less than 1.0% of our Consolidated Net Tangible
Assets. With respect to any Sale and Lease-Back Transaction or
series of related Sale and Lease-Back Transactions, the
determination of whether any property is a Principal Property
shall be determined by reference to all properties affected by
such transaction or series of transactions. As of the date of
issuance of the notes, the only Principal Properties of the
Company consisted of the Carson Valley Roasting Plant located at
2525 Starbucks Way, Minden, Nevada and the York Roasting Plant,
located at 3000 Espresso Way, York, Pennsylvania.
Rating Agencies means (1) each of
Moodys and S&P; and (2) if either Moodys
or S&P ceases to rate the notes or fails to make a rating
of the notes publicly available for reasons outside of our
control, a nationally recognized statistical rating
organization, within the meaning of
Rule 15c3-1(e)(2)(vi)(F)
under the Exchange Act, selected by us (as certified by a
resolution of our board of directors) as a replacement agency
for Moodys or S&P, or both of them, as the case may
be.
Sale and Lease-Back Transaction means
any arrangement with any person providing for the leasing by us
or any subsidiary of any Principal Property, whether now owned
or hereafter acquired, which Principal Property has been or is
to be sold or transferred by us or such subsidiary to such
person and which lease is required by generally accepted
accounting principles in the United States of America to be
capitalized on the balance sheet of such lessee.
S&P means Standard &
Poors Ratings Services, a division of The McGraw-Hill
Companies, Inc.
subsidiary means any corporation,
limited liability company or other similar type of entity in
which we
and/or one
or more of our subsidiaries together own voting stock,
membership interests or other capital securities having the
power to elect a majority of the board of directors or similar
governing body of such corporation, limited liability company or
other similar type of entity, directly or indirectly. For the
purposes of this definition, voting stock means
stock or other capital securities which ordinarily have voting
power for the election of directors or similar governing body,
whether at all times or only so long as no senior class of stock
or other capital securities have such voting power by reason of
any contingency.
Book-Entry
Delivery and Form
General
The notes will be issued in registered, global form in minimum
denominations of $2,000 with integral multiples of $1,000
thereof. Initially, the notes will be represented by one or more
permanent global certificates (the global notes)
(which may be subdivided) in definitive, fully registered form
without interest coupons. The global notes will be issued on the
issue date only against payment in immediately available funds.
The global notes will be deposited upon issuance with the
trustee as custodian for DTC in New York, New York, and
registered in the name of Cede & Co. (DTCs
partnership nominee) or another DTC nominee for credit to an
account of a direct or indirect participant in DTC, as described
below under Depositary Procedures.
Except as set forth below, the global notes may be transferred,
in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the
global notes may not be exchanged for notes in certificated form
except in the limited circumstances described below under
Exchange of Book-Entry Notes for Certificated
Notes.
Transfers of beneficial interests in the global notes will be
subject to the applicable rules and procedures of DTC and its
direct or indirect participants (including, if applicable, those
of Euroclear System (Euroclear) and Clearstream
Banking S.A. (Clearstream)), which may change from
time to time.
S-17
Depositary
Procedures
The following description of the operations and procedures of
DTC, Euroclear and Clearstream is provided solely as a matter of
convenience. These operations and procedures are solely within
the control of DTC and are subject to changes by it. We do not
take any responsibility for these operations and procedures and
urge investors to contact DTC or its participants directly to
discuss these matters.
DTC has advised us that it is a limited-purpose trust company
created to hold securities for its participating organizations,
referred to as participants, and to facilitate the
clearance and settlement of transactions in those securities
among DTCs participants through electronic book-entry
changes in accounts of its participants, thereby eliminating the
need for physical movement of securities certificates.
DTCs participants include securities brokers and dealers,
banks, trust companies, clearing corporations and certain other
organizations some of whom (and/or their representatives) own
DTC. Access to DTCs system is also available to other
entities such as banks, brokers, dealers, trust companies and
clearing corporations that clear through or maintain a custodial
relationship with a DTC participant, either directly or
indirectly, which entities are referred to as indirect
participants. Persons who are not DTC participants may
beneficially own securities held by or on behalf of DTC only
through participants or indirect participants. DTC has no
knowledge of the identity of beneficial owners of securities
held by or on behalf of DTC. DTCs records reflect only the
identity of its participants to whose accounts securities are
credited. The ownership interests and transfer of ownership
interests of each beneficial owner of each security held by or
on behalf of DTC are recorded on the records of DTCs
participants and indirect participants.
Pursuant to the procedures established by DTC:
|
|
|
|
|
upon deposit of the global notes, DTC will credit the accounts
of its participants designated by the underwriter with portions
of the principal amount of the global notes; and
|
|
|
|
ownership of such interests in the global notes will be shown
on, and the transfer of ownership of these interests will be
effected only through, records maintained by DTC (with respect
to the participants) or by the participants and the indirect
participants (with respect to other owners of beneficial
interests in the global notes).
|
Investors in the global notes who are participants in DTCs
system may hold their interests therein directly through DTC.
Investors in the global notes who are not participants may hold
their interests therein indirectly through organizations which
are participants in such system. Euroclear and Clearstream may
hold interests in the global notes on behalf of their
participants through customers securities accounts in
their respective names on the books of their respective
depositories, which are Morgan Guaranty Trust Company of
New York, Brussels office, as operator of Euroclear, and
Citibank, N.A., as operator of Clearstream. All interests in the
global notes, including those held through Euroclear or
Clearstream, will be subject to the procedures and requirements
of DTC. Those interests held through Euroclear or Clearstream
may also be subject to the procedures and requirements of such
systems. The laws of some states require that certain persons
take physical delivery of certificates evidencing securities
they own. Consequently, the ability to transfer beneficial
interests in the global notes to such persons will be limited to
that extent. Because DTC can act only on behalf of its
participants, which in turn act on behalf of indirect
participants, the ability of beneficial owners of interests in
the global notes to pledge such interests to persons or entities
that do not participate in the DTC system, or otherwise take
actions in respect of such interests, may be affected by the
lack of a physical certificate evidencing such interests.
Except as described below, owners of interests in the global
notes will not have notes registered in their names, will not
receive physical delivery of notes in certificated form and will
not be considered the registered owners or holders
thereof under the indenture for any purpose.
Payments in respect of the principal of, and interest and
premium, if any, on, global notes registered in the name of DTC
or its nominee will be payable to DTC in its capacity as the
registered holder under the indenture. Under the terms of the
indenture, we and the trustee will treat the persons
S-18
in whose names the notes, including the global notes, are
registered as the owners thereof for the purpose of receiving
such payments and for any and all other purposes. Consequently,
neither we nor the trustee nor any of our respective agents has
or will have any responsibility or liability for:
|
|
|
|
|
any aspect of DTCs records or any participants or
indirect participants records relating to or payments made
on account of beneficial ownership interests in the global
notes, or for maintaining, supervising or reviewing any of
DTCs records or any participants or indirect
participants records relating to the beneficial ownership
interests in the global notes; or
|
|
|
|
any other matter relating to the actions and practices of DTC or
any of its participants or indirect participants.
|
DTC has advised us that its current practice, upon receipt of
any payment in respect of securities such as the notes
(including principal and interest), is to credit the accounts of
the relevant participants with the payment on the payment date
unless DTC has reason to believe it will not receive payment on
such payment date. The account of each relevant participant is
credited with an amount proportionate to the amount of its
interest in the principal amount of the global notes as shown on
the records of DTC. Payments by the participants and the
indirect participants to the beneficial owners of notes will be
governed by standing instructions and customary practices, and
will be the responsibility of the participants or the indirect
participants and will not be the responsibility of DTC, the
trustee or us. Neither we nor the trustee will be liable for any
delay by DTC or any of its participants in identifying the
beneficial owners of the notes, and we and the trustee may
conclusively rely on and will be protected in relying on
instructions from DTC or its nominee for all purposes.
Transfers between participants in DTC will be effected in
accordance with DTCs procedures, and will be settled in
same-day
funds. Transfers between participants in Euroclear and
Clearstream will be effected in accordance with their respective
rules and operating procedures. Cross-market transfers between
the participants in DTC, on the one hand, and Euroclear or
Clearstream participants, on the other hand, will be effected
through DTC in accordance with DTCs rules on behalf of
Euroclear or Clearstream, as the case may be, by its respective
depositary; however, such cross-market transactions will require
delivery of instructions to Euroclear or Clearstream, as the
case may be, by the counterparty in such system in accordance
with the rules and procedures and within the established
deadlines (Brussels time) of such system. Euroclear or
Clearstream, as the case may be, will, if the transaction meets
its settlement requirements, deliver instructions to its
respective depositary to take action to effect final settlement
on its behalf by delivering or receiving interests in the
relevant global note in DTC, and making or receiving payment in
accordance with normal procedures for
same-day
funds settlement applicable to DTC. Euroclear participants and
Clearstream participants may not deliver instructions directly
to the depositories for Euroclear or Clearstream.
DTC has advised us that it will take any action permitted to be
taken by a holder of notes only at the direction of one or more
participants to whose account DTC has credited the interests in
the global notes and only in respect of such portion of the
aggregate principal amount of the notes as to which such
participant or participants has or have given such direction.
Although DTC, Euroclear and Clearstream have agreed to the
procedures described above to facilitate transfers of interests
in the global notes among participants in DTC, Euroclear and
Clearstream, they are under no obligation to perform or to
continue to perform those procedures, and those procedures may
be discontinued or changed at any time. Neither we nor the
trustee will have any responsibility for the performance by DTC,
Euroclear or Clearstream or their respective participants or
indirect participants of their respective obligations under the
rules and procedures governing their operations.
S-19
Exchange of
Book-Entry Notes for Certificated Notes
The global notes are exchangeable for certificated notes in
definitive, fully registered form without interest coupons only
in the following limited circumstances:
|
|
|
|
|
DTC (1) notifies us that it is unwilling or unable to
continue as depositary for the global notes and we fail to
appoint a successor depositary within 90 days or
(2) has ceased to be a clearing agency registered under the
Exchange Act; or
|
|
|
|
we notify the trustee in writing that we have elected to cause
the issuance of certificated notes under the indenture.
|
In all cases, certificated notes delivered in exchange for any
global notes or beneficial interests therein will be registered
in the names, and issued in any approved denominations,
requested by or on behalf of DTC (in accordance with its
customary procedures).
Payment and
Paying Agents
Payments on the global notes will be made in U.S. dollars
by wire transfer. If we issue definitive notes, the holders of
definitive notes will be able to receive payments of principal
of and interest on their notes at the office of our paying agent
maintained in the Borough of Manhattan, The City of New York.
Payment of principal of a definitive note may be made only
against surrender of the note to our paying agent. We have the
option, however, of making payments of interest by wire transfer
or by mailing checks to the address of the holder appearing in
the register of note holders maintained by the registrar.
We will make any required interest payments to the person in
whose name a note is registered at the close of business on the
record date for the interest payment.
The trustee will be designated as our paying agent for payments
on the notes. We may at any time designate additional paying
agents or rescind the designation of any paying agent or approve
a change in the office through which any paying agent acts.
Notices
Any notices required to be given to the holders of the notes
will be given to DTC, as the registered holder of the global
notes. In the event that the global notes are exchanged for
notes in definitive form, notices to holders of the notes will
be made by first-class mail, postage prepaid, to the addresses
that appear on the register of noteholders maintained by the
registrar.
The
Trustee
The trustees current address is 60 Wall Street, Mailstop
2710, New York, New York 10005, Attn: Trust &
Securities Services Corporates Deal Manager. The
trustee is one of a number of banks with which we maintain
ordinary banking relationships.
The indenture provides that, except during the continuance of an
Event of Default, the trustee will perform only such duties as
are specifically set forth in the indenture. During the
existence of an Event of Default, the trustee must exercise such
rights and powers vested in it as a prudent person would
exercise under the circumstances in the conduct of such
persons own affairs.
The indenture and provisions of the Trust Indenture Act of
1939, as amended (the Trust Indenture Act),
incorporated by reference in the indenture contain limitations
on the rights of the trustee, should it become our creditor, to
obtain payment of claims in certain cases or to liquidate
certain property received by it in respect of any such claim as
security or otherwise. The trustee is permitted to engage in
other transactions with us or any of our affiliates. If the
trustee acquires any conflicting interest (as defined in the
indenture or in the Trust Indenture Act), it must eliminate
that conflict or resign.
S-20
Governing
Law
The indenture and the notes will be governed by and construed in
accordance with the laws of the State of New York.
DESCRIPTION OF
CERTAIN OTHER INDEBTEDNESS
Credit
Facility
In August 2005, we entered into a $500 million unsecured
five-year revolving credit facility with various banks, of which
$100 million may be used for issuances of letters of
credit. The facility is available for working capital, capital
expenditures and other corporate purposes, which may include
acquisitions and share repurchases. In August 2006, we increased
our borrowing capacity under the facility to $1 billion, as
provided in the original credit facility. In December 2006, we
extended the term of the facility by one year to August 2011.
The interest rate for borrowings under the facility ranges from
0.11% to 0.27% over LIBOR or an alternate base rate, which is
the greater of the bank prime rate or the Federal Funds Rate
plus 0.50%. The specific spread over LIBOR will depend upon our
performance under specified financial criteria. As of
July 1, 2007, we had no amounts outstanding under the
facility, although a letter of credit of $12.9 million was
outstanding which reduces the borrowing capacity under the
facility.
Commercial Paper
Program
On March 27, 2007, we established a commercial paper
program. Under the program we may issue unsecured commercial
paper notes, up to a maximum aggregate amount outstanding at any
time of $1 billion, with individual maturities that may
vary, but not exceed 397 days from the date of issue. The
program is backstopped by our credit facility, and the combined
borrowing limit remains at $1 billion for the program and
the facility. Under the program, we may issue commercial paper
from time to time, and the proceeds of the commercial paper
financing will be used for working capital, capital expenditures
and other corporate purposes, which may include acquisitions and
share repurchases. As of July 1, 2007, we had
$880 million of commercial paper borrowing outstanding.
S-21
UNDERWRITING
We and Goldman, Sachs & Co., Banc of America
Securities LLC and Citigroup Global Markets Inc., the
representatives for the underwriters for the offering, have
entered into an underwriting agreement and a pricing agreement
with respect to the notes. Subject to certain conditions, the
underwriters have agreed, severally and not jointly, to purchase
the principal amount of the notes listed opposite their names in
the table below.
|
|
|
|
|
|
|
Principal
|
|
Underwriter
|
|
Amount
of Notes
|
|
|
Goldman, Sachs &
Co.
|
|
$
|
|
|
Banc of America Securities LLC
|
|
|
|
|
Citigroup Global Markets Inc.
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
|
|
|
|
|
|
|
The underwriters are committed to take and pay for all of the
notes being offered, if any are taken.
Notes sold by the underwriters to the public will initially be
offered at the initial public offering price set forth on the
cover of this prospectus supplement. Any notes sold by the
underwriters to securities dealers may be sold at a discount
from the initial public offering price of up
to % of the principal amount of the
notes. Any such securities dealers may resell any notes
purchased from the underwriters to certain other brokers or
dealers at a discount from the initial public offering price of
up to % of the principal amount of
the notes. If all the notes are not sold at the initial offering
price, the underwriters may change the offering price and the
other selling terms.
The notes are a new issue of securities with no established
trading market. We have been advised by the underwriters that
the underwriters intend to make a market in the notes but are
not obligated to do so and may discontinue market making at any
time without notice. No assurance can be given as to the
liquidity of the trading market for the notes.
In connection with the offering, the underwriters may purchase
and sell notes in the open market. These transactions may
include short sales, stabilizing transactions and purchases to
cover positions created by short sales. Short sales involve the
sale by the underwriters of a greater aggregate principal amount
of notes than it is required to purchase in the offering.
Stabilizing transactions consist of certain bids or purchases
made for the purpose of preventing or retarding a decline in the
market price of the notes while the offering is in progress.
The underwriters also may impose a penalty bid. This occurs when
a particular underwriter repays to the underwriters a portion of
the underwriting discount received by it because the
representative has repurchased notes sold by or for the account
of such underwriter in stabilizing or short covering
transactions.
These activities by the underwriters, as well as other purchases
by the underwriters for their own accounts, may stabilize,
maintain or otherwise affect the market price of the notes. As a
result, the price of the notes may be higher than the price that
otherwise might exist in the open market. If these activities
are commenced, they may be discontinued by the underwriters at
any time. These transactions may be effected in the
over-the-counter market or otherwise.
In relation to each member state of the European Economic Area
(Iceland, Norway and Liechtenstein in addition to member states
of the European Union) which has implemented the Prospectus
Directive (each, a relevant member state), each
underwriter has represented and agreed that with effect from and
including the date on which the Prospectus Directive is
implemented in that relevant member state (the relevant
implementation date) it has not made and will not make an
offer of notes to the public in that relevant member state prior
to the publication of a prospectus in relation to the notes
which has been approved by the competent authority in that
relevant member state or, where appropriate, approved in another
relevant member state and notified to the competent authority
S-22
in that relevant member state, all in accordance with the
Prospectus Directive, except that it may, with effect from and
including the relevant implementation date, make an offer of
notes to the public in that relevant member state at any time:
|
|
|
|
|
to legal entities which are authorized or regulated to operate
in the financial markets or, if not so authorized or regulated,
whose corporate purpose is solely to invest in securities;
|
|
|
|
to any legal entity which has two or more of (1) an average
of at least 250 employees during the last financial year,
(2) a total balance sheet of more than 43,000,000 and
(3) an annual net turnover of more than 50,000,000,
as shown in its last annual or consolidated accounts; or
|
|
|
|
in any other circumstances which do not require the publication
by us of a prospectus pursuant to Article 3 of the
Prospectus Directive.
|
For the purposes of this provision, the expression an
offer of notes to the public in relation to any
notes in any relevant member state means the communication in
any form and by any means of sufficient information on the terms
of the offer and the notes to be offered so as to enable an
investor to decide to purchase or subscribe the notes, as the
same may be varied in that member state by any measure
implementing the Prospectus Directive in that member state and
the expression Prospectus Directive means Directive
2003/71/EC and includes any relevant implementing measure in
each relevant member state.
Each underwriter has represented and agreed that:
|
|
|
|
|
it has only communicated or caused to be communicated and will
only communicate or cause to be communicated an invitation or
inducement to engage in investment activity (within the meaning
of Section 21 of the FSMA) received by it in connection
with the issue or sale of the notes in circumstances in which
Section 21(1) of the FSMA does not apply to us; and
|
|
|
|
it has complied and will comply with all applicable provisions
of the FSMA with respect to anything done by it in relation to
the notes in, from or otherwise involving the United Kingdom.
|
The notes may not be offered or sold by means of any document
other than (i) in circumstances which do not constitute an
offer to the public within the meaning of the Companies
Ordinance (Cap. 32, Laws of Hong Kong), or (ii) to
professional investors within the meaning of the
Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong)
and any rules made thereunder, or (iii) in other
circumstances which do not result in the document being a
prospectus within the meaning of the Companies
Ordinance (Cap. 32, Laws of Hong Kong), and no advertisement,
invitation or document relating to the notes may be issued or
may be in the possession of any person for the purpose of issue
(in each case whether in Hong Kong or elsewhere), which is
directed at, or the contents of which are likely to be accessed
or read by, the public in Hong Kong (except if permitted to do
so under the laws of Hong Kong) other than with respect to notes
which are or are intended to be disposed of only to persons
outside Hong Kong or only to professional investors
within the meaning of the Securities and Futures Ordinance (Cap.
571, Laws of Hong Kong) and any rules made thereunder.
The notes have not been and will not be registered under the
Securities and Exchange Law of Japan (the Securities and
Exchange Law), and the underwriter has agreed that it will
not offer or sell any notes, directly or indirectly, in Japan or
to, or for the benefit of, any resident of Japan (which term, as
used herein, means any person resident in Japan, including any
corporation or other entity organized under the laws of Japan),
or to others for re-offering or resale, directly or indirectly,
in Japan or to a resident of Japan, except pursuant to an
exemption from the registration requirements of, and otherwise
in compliance with, the Securities and Exchange Law and any
other applicable laws, regulations and ministerial guidelines of
Japan.
This prospectus has not been registered as a prospectus with the
Monetary Authority of Singapore. Accordingly, this prospectus
and any other document or material in connection with the offer
or sale, or invitation for subscription or purchase, of the
notes may not be circulated or
S-23
distributed, nor may the notes be offered or sold, or be made
the subject of an invitation for subscription or purchase,
whether directly or indirectly, to persons in Singapore other
than (i) to an institutional investor under
Section 274 of the Securities and Futures Act,
Chapter 289 of Singapore (the SFA),
(ii) to a relevant person, or any person pursuant to
Section 275(1A), and in accordance with the conditions,
specified in Section 275 of the SFA or (iii) otherwise
pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA.
Where the notes are subscribed or purchased under
Section 275 by a relevant person which is: (a) a
corporation (which is not an accredited investor) the sole
business of which is to hold investments and the entire share
capital of which is owned by one or more individuals, each of
whom is an accredited investor; or (b) a trust (where the
trustee is not an accredited investor) whose sole purpose is to
hold investments and each beneficiary is an accredited investor,
shares, debentures and units of shares and debentures of that
corporation or the beneficiaries rights and interest in
that trust shall not be transferable for 6 months after
that corporation or that trust has acquired the notes under
Section 275 except: (1) to an institutional investor
under Section 274 of the SFA or to a relevant person, or
any person pursuant to Section 275(1A), and in accordance
with the conditions, specified in Section 275 of the SFA;
(2) where no consideration is given for the transfer; or
(3) by operation of law.
We estimate that our share of the total expenses of the
offering, excluding underwriting discounts and commissions, will
be approximately $1.1 million.
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act of
1933, as amended.
The underwriters and their affiliates have, from time to time,
performed, and may in the future perform, various financial
advisory, commercial and investment banking services for us, for
which they received or will receive customary fees.
Bank of America, N.A., an affiliate of Banc of America
Securities LLC, is the administrative agent under our credit
agreement and also a lender thereunder. Citibank, N.A., an
affiliate of Citigroup Global Markets Inc., is a
co-documentation agent under our credit agreement and also a
lender thereunder.
Affiliates of Goldman, Sachs & Co., Banc of America
Securities LLC and Citigroup Global Markets Inc. are lenders
under the
364-day
credit facility and will receive a portion of the proceeds of
this offering in repayment of our indebtedness under the
364-day
credit facility. Because more than 10% of the net proceeds of
this offering, not including underwriting compensation, will be
received by an affiliate of Goldman, Sachs & Co., an
affiliate of Banc of America Securities LLC and an affiliate of
Citigroup Global Markets Inc., this offering is being conducted
in compliance with NASD Conduct Rule 2710(h), which may
require the appointment of a qualified independent
underwriter under certain circumstances. Pursuant to NASD
Conduct Rules 2710(h)(3)(A) and 2720(c)(3)(C), the
appointment of a qualified independent underwriter is not
necessary in connection with this offering as we are offering a
class of investment grade debt securities hereby.
LEGAL
MATTERS
The validity of the notes will be passed upon for us by DLA
Piper US LLP, Seattle, Washington and New York, New York.
Certain legal matters will be passed upon for the underwriters
by Shearman & Sterling LLP, San Francisco,
California.
S-24
PROSPECTUS
Starbucks
Corporation
Debt Securities
This prospectus is part of a registration statement that we have
filed with the Securities and Exchange Commission using a
shelf registration process. This means:
|
|
|
|
|
we may offer and sell debt securities from time to time;
|
|
|
|
we will provide a prospectus supplement each time we offer and
issue the securities; and
|
|
|
|
the applicable prospectus supplement will provide specific
information about the terms of the securities offered under it
and also may add, update or change information contained in this
prospectus.
|
We will provide the specific terms of the securities in
prospectus supplements to this prospectus. You should carefully
read this prospectus and any applicable prospectus supplement
carefully before you invest. Investing in the securities
involves risks. See Risk Factors beginning on
page 1.
The securities offered by this prospectus may be offered
directly, through agents designated from time to time by us, or
to or through underwriters or dealers. If any agents or
underwriters are involved in the sale of any of the securities
offered by this prospectus, their names, and any applicable
purchase price, fee, commission or discount arrangement between
or among them, will be set forth, or will be calculable from the
information set forth, in the applicable prospectus supplement.
None of the securities offered by this prospectus may be sold
without delivery of the applicable prospectus supplement
describing the method and terms of the offering of those
securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus is August 20, 2007
TABLE OF
CONTENTS
|
|
|
|
|
Page
|
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
2
|
|
|
2
|
|
|
2
|
|
|
3
|
|
|
10
|
|
|
10
|
|
|
10
|
|
|
11
|
ABOUT THIS
PROSPECTUS
This prospectus is part of a shelf registration
statement that we have filed with the Securities and Exchange
Commission, or SEC. By using a shelf registration statement, we
may sell any combination of the securities described in this
prospectus from time to time and in one or more offerings. Each
time we sell securities, we will provide a prospectus supplement
to this prospectus that contains specific information about the
terms of the offering and of the securities being offered. Each
prospectus supplement may also add, update or change information
contained in this prospectus. Before purchasing any securities,
you should carefully read both this prospectus and the
accompanying prospectus supplement and any free writing
prospectus prepared by or on behalf of us, together with the
documents we have incorporated by reference in this prospectus
described under the heading Incorporation of Certain
Documents by Reference and the additional information
described under the heading Where You Can Find More
Information.
You should rely only on the information contained or
incorporated by reference into this prospectus and in the
accompanying prospectus supplement. We have not authorized any
other person to provide you with different information. If
anyone provides you with different or inconsistent information,
you should not rely on it. We are not making an offer to sell
these securities in any jurisdiction where the offer or sale is
not permitted. You should assume that the information appearing
in this prospectus and the accompanying prospectus supplement
and any free writing prospectus prepared by or on behalf of us
is accurate only as of the date of their respective covers. Our
business, financial condition, results of operations and
prospects may have subsequently changed.
References in this prospectus to Starbucks,
we, us and our are to
Starbucks Corporation, a Washington corporation, and its
subsidiaries unless the context otherwise provides.
THE
COMPANY
We purchase and roast high-quality whole bean coffees and sell
them, along with fresh, rich-brewed coffees, Italian-style
espresso beverages, cold blended beverages, a variety of
complementary food items, coffee-related accessories and
equipment, a selection of premium teas and a line of compact
discs, primarily through company-operated retail stores. We also
sell coffee and tea products and license our trademark through
other channels and, through certain of our equity investees, we
produce and sell ready-to-drink beverages which include, among
others, bottled
Frappuccino®
coffee drinks and Starbucks
DoubleShot®
espresso drinks, and a line of superpremium ice creams. Our
objective is to establish Starbucks as one of the most
recognized and respected brands in the world. To achieve this
goal, we plan to continue rapid expansion of our retail
operations, to grow the activities we conduct outside of our
company-operated retail stores and to selectively pursue other
opportunities to leverage the Starbucks brand through the
introduction of new products and the development of new channels
of distribution. Our brand portfolio includes superpremium
Tazo®
teas, Starbucks Hear
Music®
compact discs, Seattles Best
Coffee®
and Torrefazione
Italia®
coffee.
We were incorporated in the State of Washington in 1985. Our
principal executive offices are located at 2401 Utah Avenue
South, Seattle, Washington 98134. Our telephone number is
(206) 447-1575.
RISK
FACTORS
Investment in any securities offered pursuant to this prospectus
involves risks. You should carefully consider the risk factors
incorporated by reference to our most recent Annual Report on
Form 10-K
and our subsequent Quarterly Reports on
Form 10-Q
and the other information contained or incorporated by reference
in this prospectus, as updated by our subsequent filings under
the Securities Exchange Act of 1934, as amended, or the Exchange
Act, and the risk factors and other information contained in the
applicable prospectus supplement before acquiring any of such
securities. The occurrence of any of these risks might cause you
to lose all or part of your investment in the offered securities.
1
FORWARD-LOOKING
STATEMENTS
This prospectus and the accompanying prospectus supplement and
the information incorporated by reference in this prospectus
contain certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995 with respect to our financial condition, results of
operations, growth expectations and other matters. Statements in
this prospectus and the accompanying prospectus supplement,
including those incorporated by reference, that are not
historical facts are forward-looking statements for
the purpose of the safe harbor provided by Section 21E of
the Exchange Act and Section 27A of the Securities Act of
1933, as amended, or the Securities Act. Forward-looking
statements can be identified by the fact that they do not relate
strictly to historical or current facts. They often include
words such as expects, anticipates,
intends, plans, believes,
seeks, estimates, or words of similar
meaning, or future or conditional verbs, such as
will, should, could, or
may.
Forward-looking statements provide our expectations or
predictions of future conditions, events or results. They are
not guarantees of future performance. By their nature
forward-looking statements are subject to risks and
uncertainties. These statements speak only as of the date they
are made. We do not undertake to update forward-looking
statements to reflect the impact of circumstances or events that
arise after the date the forward-looking statements were made.
There are a number of important factors, many of which are
beyond our control, that could cause actual conditions, events
or results to differ significantly from those described in the
forward-looking statements. These factors are generally
described in our most recent Annual Report on
Form 10-K
under the caption Risk Factors.
RATIO OF EARNINGS
TO FIXED CHARGES
The following table sets forth our ratios of earnings to fixed
charges for each of the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
39 Weeks
Ended
|
|
Fiscal Years
Ended
|
|
|
July 1,
|
|
October 1,
|
|
October 2,
|
|
October 3,
|
|
September 28,
|
|
September 29,
|
|
|
2007
|
|
2006
|
|
2005
|
|
2004
|
|
2003
|
|
2002
|
|
Ratio of earnings to fixed charges:
|
|
|
5.4
|
|
|
|
5.7
|
|
|
|
6.0
|
|
|
|
5.5
|
|
|
|
4.5
|
|
|
|
4.1
|
|
USE OF
PROCEEDS
Unless otherwise indicated in the prospectus supplement, we
intend to use the net proceeds from the sale of the securities
under this prospectus for general corporate purposes, which may
include the repayment of our indebtedness outstanding from time
to time and the repurchase of our common stock under our ongoing
share repurchase program as updated and approved by our board of
directors. Specific allocations of the proceeds for such
purposes have not been made at this time.
2
DESCRIPTION OF
DEBT SECURITIES
This prospectus describes the general terms and provisions of
our debt securities. When we offer to sell a particular series
of debt securities, we will describe the specific terms of the
series in a supplement to this prospectus. We will also indicate
in the supplement whether the general terms and provisions
described in this prospectus apply to a particular series of
debt securities.
The debt securities will be issued under an indenture between us
and Deutsche Bank Trust Company Americas, as trustee, as it
may be amended and supplemented from time to time. We have
summarized select portions of the indenture below. The summary
is not complete, and is qualified in its entirety by reference
to the indenture. The form of the indenture has been
incorporated by reference as an exhibit to the registration
statement. You should read the indenture for provisions that may
be important to you. Capitalized terms used in the summary have
the meaning specified in the indenture.
General
Unless otherwise specified in a supplement to this prospectus,
the debt securities will be our senior, direct, unsecured
obligations and, as such, will rank pari passu in right of
payment with all of our existing and future senior unsecured
indebtedness and senior in right of payment to all of our
subordinated indebtedness. The debt securities will be
effectively subordinated to (i) all existing and future
indebtedness or other liabilities of our subsidiaries and
(ii) all of our existing and future secured indebtedness to
the extent of the value of the collateral securing that
indebtedness.
The indenture does not limit the aggregate principal amount of
debt securities that may be issued under it and provides that
debt securities may be issued under it from time to time in one
or more series. Unless otherwise specified in an applicable
prospectus supplement, the indenture does not afford the holders
of the debt securities the right to require us to repurchase or
redeem the debt securities in the event of a highly-leveraged
transaction.
We are not obligated to issue all debt securities of one series
at the same time and, unless otherwise provided in the
prospectus supplement, we may reopen a series, without the
consent of the holders of the outstanding debt securities of
that series, for the issuance of additional debt securities of
that series. Additional debt securities of a particular series
will have the same terms and conditions as outstanding debt
securities of such series, except for the date of original
issuance and the offering price, and will be consolidated with,
and form a single series with, such outstanding debt securities.
Debt securities may be issued in separate series without
limitation as to aggregate principal amount. We may specify a
maximum aggregate principal amount for the debt securities of
any series.
We are not limited as to the amount of debt securities we may
issue under the indenture, though such amount shall be limited
by the aggregate principal amount of securities that we may sell
under any applicable prospectus supplement. The prospectus
supplement will set forth, among other things:
|
|
|
|
|
the title of the debt securities;
|
|
|
|
the price or prices (expressed as a percentage of the principal
amount) at which we will sell the debt securities;
|
|
|
|
any limit on the aggregate principal amount of the debt
securities;
|
|
|
|
the date or dates on which we will pay the principal on the debt
securities;
|
|
|
|
the dates, if any, on which interest on the offered debt
securities will be payable, and the regular record date for any
interest payable on any offered securities;
|
|
|
|
the rate or rates (which may be fixed or variable) per annum or
the method used to determine the rate or rates (including any
commodity, commodity index, stock exchange index or financial
index) at which the debt securities will bear interest, the date
or dates from which interest will
|
3
|
|
|
|
|
accrue, the date or dates on which interest will commence and be
payable and any regular record date for the interest payable on
any interest payment date;
|
|
|
|
|
|
the place or places where principal of, and premium and interest
on, the debt securities will be payable;
|
|
|
|
the terms and conditions upon which we may redeem the debt
securities;
|
|
|
|
any obligation we have to redeem or purchase the debt securities
pursuant to any sinking fund or analogous provisions or at the
option of a holder of debt securities;
|
|
|
|
the dates on which and the price or prices at which we will
repurchase debt securities at the option of the holders of debt
securities and other detailed terms and provisions of these
repurchase obligations;
|
|
|
|
the denominations in which the debt securities will be issued,
if other than denominations of $1,000 and any integral multiple
thereof;
|
|
|
|
whether the debt securities will be issued in the form of
certificated debt securities or global debt securities;
|
|
|
|
the portion of principal amount of the debt securities payable
upon declaration of acceleration of the maturity date, if other
than the principal amount;
|
|
|
|
the designation of the currency, currencies or currency units in
which payment of principal of, and premium and interest on, the
debt securities will be made if other than U.S. dollars;
|
|
|
|
any provisions relating to any security provided for the debt
securities;
|
|
|
|
any addition to or change in the events of default described in
this prospectus or in the indenture with respect to the debt
securities and any change in the acceleration provisions
described in this prospectus or in the indenture with respect to
the debt securities;
|
|
|
|
any addition to or change in the covenants described in this
prospectus or in the indenture with respect to the debt
securities;
|
|
|
|
any other terms of the debt securities, which may modify or
delete any provision of the indenture as it applies to that
series; and
|
|
|
|
any depositaries, interest rate calculation agents, exchange
rate calculation agents or other agents with respect to the debt
securities.
|
The foregoing is not intended to be an exclusive list of the
terms that may be applicable to any offered debt securities. In
addition, the indenture does not limit in any respect our
ability to issue convertible or subordinated debt securities.
Any conversion or subordination provisions of a particular
series of debt securities will be set forth in the
officers certificate or supplemental indenture related to
that series of debt securities and will be described in the
relevant prospectus supplement. Such terms may include
provisions for conversion, either mandatory, at the option of
the holder or at our option, in which case the number of shares
of common stock or other securities to be received by the
holders of debt securities upon conversion would be calculated
as of a time and in the manner stated in the prospectus
supplement.
We may issue debt securities that provide for an amount less
than their stated principal amount to be due and payable upon
declaration of acceleration of their maturity pursuant to the
terms of the indenture. We will provide you with information on
the federal income tax considerations and other special
considerations applicable to any of these debt securities in the
applicable prospectus supplement.
If we denominate the purchase price of any of the debt
securities in a foreign currency or currencies or a foreign
currency unit or units, or if the principal of and any premium
and interest on any series of debt securities is payable in a
foreign currency or currencies or a foreign currency unit or
4
units, we will provide you with information on the restrictions,
elections, general tax considerations, specific terms and other
information with respect to that issue of debt securities and
such foreign currency or currencies or foreign currency unit or
units in the applicable prospectus supplement.
Exchange and
Transfer
Debt securities may be transferred or exchanged at the office of
the security registrar or at the office of any transfer agent
designated by us.
We will not impose a service charge for any transfer or
exchange, but we may require holders to pay any tax or other
governmental charges associated with any transfer or exchange.
In the event of any potential redemption of debt securities of
any series, we will not be required to:
|
|
|
|
|
issue, register the transfer of, or exchange, any debt security
of that series during a period beginning at the opening of
business 15 days before the day of mailing of a notice of
redemption and ending at the close of business on the day of the
mailing; or
|
|
|
|
register the transfer of or, exchange any, debt security of that
series selected for redemption, in whole or in part, except the
unredeemed portion of a security being redeemed in part.
|
We may initially appoint the trustee as the security registrar.
Any transfer agent, in addition to the security registrar
initially designated by us, will be named in the prospectus
supplement. We may designate additional transfer agents or
change transfer agents or change the office of the transfer
agent. However, we will be required to maintain a transfer agent
in each place of payment for the debt securities of each series.
Global
Securities
The debt securities of any series may be represented, in whole
or in part, by one or more global securities. Each global
security will:
|
|
|
|
|
be registered in the name of a depositary that we will identify
in a prospectus supplement;
|
|
|
|
be deposited with the depositary or its nominee or
custodian; and
|
|
|
|
bear any required legends.
|
No global security may be exchanged in whole or in part for debt
securities registered in the name of any person other than the
depositary or any nominee unless:
|
|
|
|
|
the depositary has notified us that it is unwilling or unable to
continue as depositary or has ceased to be qualified to act as
depositary;
|
|
|
|
an event of default is continuing; or
|
|
|
|
any other circumstances described in a prospectus supplement
occur.
|
As long as the depositary, or its nominee, is the registered
owner of a global security, the depositary or nominee will be
considered the sole owner and holder of the debt securities
represented by the global security for all purposes under the
indenture. Except in the above limited circumstances, owners of
beneficial interests in a global security:
|
|
|
|
|
will not be entitled to have the debt securities registered in
their names;
|
|
|
|
will not be entitled to physical delivery of certificated debt
securities; and
|
|
|
|
will not be considered to be holders of those debt securities
under the indenture.
|
Payments on a global security will be made to the depositary or
its nominee as the holder of the global security. Some
jurisdictions have laws that require that certain purchasers of
securities take
5
physical delivery of such securities in definitive form. These
laws may impair the ability to transfer beneficial interests in
a global security.
Institutions that have accounts with the depositary or its
nominee are referred to as participants. Ownership
of beneficial interests in a global security will be limited to
participants and to persons that may hold beneficial interests
through participants. The depositary will credit, on its
book-entry registration and transfer system, the respective
principal amounts of debt securities represented by the global
security to the accounts of its participants. Each person owning
a beneficial interest in a global security must rely on the
procedures of the depositary (and, if such person is not a
participant, on procedures of the participant through which such
person owns its interest) to exercise any rights of a holder
under the indenture.
Ownership of beneficial interests in a global security will be
shown on and effected through records maintained by the
depositary, with respect to participants interests, or any
participant, with respect to interests of persons held by
participants on their behalf. Payments, transfers and exchanges
relating to beneficial interests in a global security will be
subject to policies and procedures of the depositary. The
depositary policies and procedures may change from time to time.
Neither we nor the trustee will have any responsibility or
liability for the depositarys or any participants
records with respect to beneficial interests in a global
security.
Payment and
Paying Agent
The provisions of this subsection will apply to the debt
securities unless otherwise indicated in the prospectus
supplement. Payment of interest on a debt security on any
interest payment date will be made to the person in whose name
the debt security is registered at the close of business on the
regular record date. Payment on debt securities of a particular
series will be payable at the office of a paying agent or paying
agents designated by us. However, at our option, we may pay
interest by mailing a check to the record holder.
We may also name any other paying agents in the prospectus
supplement. We may designate additional paying agents, change
paying agents or change the office of any paying agent. However,
we will be required to maintain a paying agent in each place of
payment for the debt securities of a particular series.
All moneys paid by us to a paying agent for payment on any debt
security which remain unclaimed at the end of two years after
such payment was due will be repaid to us. Thereafter, the
holder may look only to us for such payment.
Consolidation,
Merger and Sale of Assets
Except as otherwise set forth in the prospectus supplement, we
may not consolidate with or merge into any other person, in a
transaction in which we are not the surviving corporation, or
convey, transfer or lease our properties and assets
substantially as an entirety to, any person, unless:
|
|
|
|
|
the successor, if any, is a U.S. corporation, limited
liability company, partnership, trust or other entity;
|
|
|
|
the successor assumes our obligations on the debt securities and
under the indenture;
|
|
|
|
immediately after giving effect to the transaction and treating
our obligations in connection with or as a result of such
transaction as having been incurred as of the time of such
transaction, no default or event of default shall have occurred
and be continuing under the indenture; and
|
|
|
|
certain other conditions are met.
|
6
Events of
Default
Event of default means, with respect to any series of debt
securities, any of the following:
|
|
|
|
|
default in the payment of any interest on any debt security of
that series when it becomes due and payable, and continuance of
that default for a period of 90 days;
|
|
|
|
default in the payment of principal of, or premium on, any debt
security of that series when due and payable;
|
|
|
|
default in the performance or breach of any other covenant or
warranty by us in the indenture (other than a covenant or
warranty that has been included in the indenture solely for the
benefit of a series of debt securities other than that series),
which default continues uncured for a period of 90 days
after we receive written notice from the trustee or we and the
trustee receive written notice from the holders of not less than
a majority in aggregate principal amount of the outstanding debt
securities of that series as provided in the indenture;
|
|
|
|
certain events of bankruptcy, insolvency or reorganization of
our company; and
|
|
|
|
any other event of default provided with respect to debt
securities of that series that is described in the applicable
prospectus supplement accompanying this prospectus.
|
No event of default with respect to a particular series of debt
securities (except as to certain events of bankruptcy,
insolvency or reorganization) necessarily constitutes an event
of default with respect to any other series of debt securities.
The occurrence of an event of default may constitute an event of
default under our bank credit agreements in existence from time
to time. In addition, the occurrence of certain events of
default or an acceleration under the indenture may constitute an
event of default under certain of our other indebtedness
outstanding from time to time.
If an event of default with respect to debt securities of any
series at the time outstanding occurs and is continuing, then
the trustee or the holders of not less than 25% in aggregate
principal amount of the outstanding debt securities of that
series may, by a notice in writing to us (and to the trustee if
given by the holders), declare to be due and payable immediately
the principal (or, if the debt securities of that series are
discount securities, that portion of the principal amount as may
be specified in the terms of that series) of, and accrued and
unpaid interest, if any, on all debt securities of that series.
In the case of an event of default resulting from certain events
of bankruptcy, insolvency or reorganization, the principal (or
such specified amount) of and accrued and unpaid interest, if
any, on all outstanding debt securities will become and be
immediately due and payable without any declaration or other act
on the part of the trustee or any holder of outstanding debt
securities. At any time after a declaration of acceleration with
respect to debt securities of any series has been made, but
before a judgment or decree for payment of the money due has
been obtained by the trustee, the holders of a majority in
aggregate principal amount of the outstanding debt securities of
that series may rescind and annul the acceleration if all events
of default, other than the non-payment of accelerated principal
and interest, if any, with respect to debt securities of that
series, have been cured or waived as provided in the indenture.
The indenture provides that the trustee will be under no
obligation to exercise any of its rights or powers under the
indenture at the request of any holder of outstanding debt
securities, unless the trustee receives indemnity satisfactory
to it against any loss, liability or expense. Subject to certain
rights of the trustee, the holders of a majority in principal
amount of the outstanding debt securities of any series will
have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the
trustee or exercising any trust or power conferred on the
trustee with respect to the debt securities of that series.
7
No holder of any debt security of any series will have any right
to institute any proceeding, judicial or otherwise, with respect
to the indenture or for the appointment of a receiver or
trustee, or for any remedy under the indenture, unless:
|
|
|
|
|
that holder has previously given to the trustee written notice
of a continuing event of default with respect to debt securities
of that series; and
|
|
|
|
the holders of at least 25% in aggregate principal amount of the
outstanding debt securities of that series have made written
request, and offered reasonable indemnity, to the trustee to
institute the proceeding as trustee, and the trustee has not
received from the holders of a majority in aggregate principal
amount of the outstanding debt securities of that series a
direction inconsistent with that request and has failed to
institute the proceeding within 60 days.
|
Notwithstanding the foregoing, the holder of any debt security
will have an absolute and unconditional right to receive payment
of the principal of, and premium and any interest on, that debt
security on or after the due dates expressed in that debt
security and to institute suit for the enforcement of such
payment.
The indenture requires us, within 120 days after the end of
our fiscal year, to furnish to the trustee a statement as to
compliance with the indenture. The indenture provides that the
trustee may withhold notice to the holders of debt securities of
any series of any default or event of default (except in payment
on any debt securities of that series) with respect to debt
securities of that series if it in good faith determines that
withholding notice is in the interest of the holders of those
debt securities.
Modification and
Waiver
We may modify and amend the indenture with the consent of the
holders of at least a majority in principal amount of the
outstanding debt securities of each series affected by the
modifications or amendments. We may not make any modification or
amendment without the consent of the holders of each affected
debt security then outstanding if that amendment will:
|
|
|
|
|
reduce the principal of or change the fixed maturity of any debt
security or alter or waive any of the provisions with respect to
the redemption or repurchase of any debt security;
|
|
|
|
reduce the rate (or alter the method of computation) of, or
extend the time for payment of, interest (including default
interest) on any debt security;
|
|
|
|
waive a default in the payment of the principal of, premium or
interest on any debt security (except a rescission of
acceleration of the debt securities of any series by the holders
of at least a majority in aggregate principal amount of the then
outstanding debt securities of that series and a waiver of the
payment default that resulted from such acceleration);
|
|
|
|
make the principal of or premium or interest on any debt
security payable in currency other than that stated in the debt
security;
|
|
|
|
make any change to certain provisions of the indenture relating
to, among other things, the right of holders of debt securities
to receive payment of the principal of, premium and interest on
those debt securities and to institute suit for the enforcement
of any such payment and to waivers or amendments; or
|
|
|
|
reduce the percentage in principal amount of debt securities of
any series, the consent of the holders of which is required for
any of the foregoing modifications or otherwise necessary to
modify or amend the indenture or to waive any past default.
|
Except for certain specified provisions, the holders of at least
a majority in principal amount of the outstanding debt
securities of any series may on behalf of the holders of all
debt securities of that series waive our compliance with
provisions of the indenture. The holders of a majority in
aggregate principal amount of the outstanding debt securities of
any series may on behalf of the holders of all the debt
securities of such series waive any past default under the
indenture with respect to that
8
series and its consequences, except a default in the payment of
the principal of, or premium or any interest on, any debt
security of that series or in respect of a covenant or
provision, which cannot be modified or amended without the
consent of all of the holders of each outstanding debt security
of the series affected; provided, however, that the
holders of a majority in aggregate principal amount of the
outstanding debt securities of any series may rescind an
acceleration and its consequences, including any related payment
default that resulted from the acceleration.
Defeasance of
Debt Securities and Certain Covenants in Certain
Circumstances
Legal Defeasance. The indenture
provides that, unless otherwise provided by the terms of the
applicable series of debt securities, we may be discharged from
any and all obligations in respect of the debt securities of any
series (except for certain obligations to register the transfer
or exchange of debt securities of such series, to replace
stolen, lost or mutilated debt securities of such series, and to
maintain paying agencies and certain provisions relating to the
treatment of funds held by paying agents). We will be so
discharged upon the deposit with the trustee, in trust, of money
and/or
U.S. government obligations or, in the case of debt
securities denominated in a single currency other than
U.S. dollars, foreign government obligations, that, through
the payment of interest and principal in accordance with their
terms, will provide money in an amount sufficient in the opinion
of a nationally recognized firm of independent public
accountants to pay and discharge each installment of principal,
premium and interest on and any mandatory sinking fund payments
in respect of the debt securities of that series on the stated
maturity of those payments in accordance with the terms of the
indenture and those debt securities.
This discharge may occur only if, among other things, we have
delivered to the trustee an opinion of counsel stating that we
have received from, or there has been published by, the
United States Internal Revenue Service a ruling or, since
the date of execution of the indenture, there has been a change
in the applicable United States federal income tax law, in
either case to the effect that, and based thereon such opinion
shall confirm that, the holders of the debt securities of that
series will not recognize income, gain or loss for United States
federal income tax purposes as a result of the deposit,
defeasance and discharge and will be subject to United States
federal income tax on the same amounts and in the same manner
and at the same times as would have been the case if the
deposit, defeasance and discharge had not occurred.
Defeasance of Certain Covenants. The
indenture provides that, unless otherwise provided by the terms
of the applicable series of debt securities, upon compliance
with certain conditions, we may omit to comply with certain of
the covenants set forth in the indenture, as well as any
additional covenants that may be set forth in the applicable
prospectus supplement, and any omission to comply with those
covenants will not constitute a default or an event of default
with respect to the debt securities of that series, or covenant
defeasance.
The conditions include:
|
|
|
|
|
depositing with the trustee money
and/or
U.S. government obligations or, in the case of debt
securities denominated in a single currency other than
U.S. dollars, foreign government obligations, that, through
the payment of interest and principal in accordance with their
terms, will provide money in an amount sufficient in the opinion
of a nationally recognized firm of independent public
accountants to pay and discharge each installment of principal
of, premium and interest on and any mandatory sinking fund
payments in respect of the debt securities of that series on the
stated maturity of those payments in accordance with the terms
of the indenture and those debt securities; and
|
|
|
|
delivering to the trustee an opinion of counsel to the effect
that the holders of the debt securities of that series will not
recognize income, gain or loss for United States federal income
tax purposes as a result of the deposit and related covenant
defeasance and will be subject to United States federal income
tax on the same amounts and in the same manner and at the same
times as would have been the case if the deposit and related
covenant defeasance had not occurred.
|
9
LEGAL
MATTERS
The validity of the debt securities offered by this prospectus
will be passed upon for us by DLA Piper US LLP, Seattle,
Washington and New York, New York.
EXPERTS
The consolidated financial statements as of October 1, 2006
and October 2, 2005, and for each of the years in the
three-year period ended October 1, 2006, and
managements report on the effectiveness of internal
control over financial reporting as of October 1, 2006,
incorporated by reference in this prospectus have been audited
by Deloitte & Touche LLP, independent registered
public accounting firm, as stated in their reports (which
reports (1) express an unqualified opinion on the financial
statements and include an explanatory paragraph regarding the
change in accounting for stock-based compensation upon adoption
of Financial Accounting Standards Board (FASB) Statement
No. 123(R), Share-Based Payment, and the change
in accounting for conditional asset retirement obligations upon
adoption of FASB Interpretation No. 47, Accounting
for Conditional Asset Retirement Obligations an
interpretation of FASB Statement No. 143,
(2) express an unqualified opinion on managements
assessment regarding the effectiveness of internal control over
financial reporting, and (3) express an unqualified opinion
on the effectiveness of internal control over financial
reporting), which are incorporated herein by reference, and have
been so incorporated in reliance upon the reports of such firm
given upon their authority as experts in accounting and auditing.
WHERE YOU CAN
FIND MORE INFORMATION
We are subject to the informational reporting requirements of
the Exchange Act, and in accordance with these requirements file
reports, proxy statements and other information with the SEC.
The reports, proxy statements and other information we file may
be inspected and copied at the SECs Public Reference Room,
100 F Street, N.E., Washington, D.C. 20549.
Information on the operation of the Public Reference Room may be
obtained by calling
1-800-SEC-0330.
The SEC file number for documents filed by us under the Exchange
Act is 0-20322. Our SEC filings are also available to the public
at the SECs website at
http://www.sec.gov.
Our common stock, $0.001 par value per share, is traded on
the Global Select Market of The NASDAQ Stock Market, Inc., under
the symbol SBUX. The address of our internet site is
http://www.starbucks.com.
We make available free of charge on or through our internet site
our annual reports on
Form 10-K,
quarterly reports on
Form 10-Q,
current reports on
Form 8-K
and amendments to those reports filed or furnished pursuant to
Section 13(a) or 15(d) of the Exchange Act, as soon as
reasonably practicable after we electronically file such
material with, or furnish it to, the SEC. Any internet addresses
provided in this prospectus are for informational purposes only
and are not intended to be hyperlinks. Accordingly, no
information in any of these internet addresses is included or
incorporated herein.
10
INCORPORATION OF
CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference the
information we file with it, which means that we can disclose
important information to you by referring you to another
document that we filed with the SEC. The information
incorporated by reference is an important part of this
prospectus, and information that we file later with the SEC will
automatically update and supersede information contained in this
prospectus. Any statement contained in a document incorporated
by reference shall be deemed to be modified or superseded for
purposes of this prospectus to the extent that a statement
contained in this prospectus modifies or supersedes such
statement. You may request a free copy of any of the documents
incorporated by reference in this prospectus by writing to us or
telephoning us at the address and telephone number set forth
below. We incorporate by reference the documents listed below
and any future filings made by us with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on
or after the date of this prospectus and prior to the
termination of the offering:
|
|
|
|
|
Our Annual Report on
Form 10-K
for the fiscal year ended October 1, 2006, filed with the
SEC on December 14, 2006, as amended by Form
10-K/A filed
with the SEC on December 21, 2006;
|
|
|
|
Our Definitive Proxy Statement filed with the SEC on
January 17, 2007;
|
|
|
|
Our Quarterly Report on
Form 10-Q
for the fiscal quarter ended December 31, 2006 filed with
the SEC on February 9, 2007; our Quarterly Report on
Form 10-Q
for the fiscal quarter ended April 1, 2007 filed with the
SEC on May 11, 2007; and our Quarterly Report on
Form 10-Q
for the fiscal quarter ended July 1, 2007 filed with the
SEC on August 10, 2007; and
|
|
|
|
Our Current Reports on
Form 8-K
filed with the SEC on October 24, 2006, November 28,
2006, March 7, 2007, March 27, 2007, April 3,
2007, May 3, 2007, July 17, 2007 and August 9,
2007.
|
To the extent that any information contained in any Current
Report on
Form 8-K,
or any exhibit thereto, was furnished to, rather than filed
with, the SEC, such information or exhibit is specifically not
incorporated by reference in this prospectus.
You may request a free copy of these filings by writing or
telephoning us at the following address:
Investor
Relations
Starbucks Corporation
2401 Utah Avenue South, Mail Stop: FP1
Seattle, Washington
98134-1435
(206) 318-7118
investorrelations@starbucks.com
http://investor.starbucks.com
11
No dealer, salesperson or other person is authorized to give
any information or to represent anything not contained in this
prospectus. You must not rely on any unauthorized information or
representations. This prospectus is an offer to sell only the
notes offered hereby, but only under circumstances and in
jurisdictions where it is lawful to do so. The information
contained in this prospectus is current only as of its date.
TABLE OF
CONTENTS
Prospectus Supplement
|
|
|
|
|
|
|
Page
|
|
About this Prospectus Supplement
|
|
|
S-i
|
|
Prospectus Supplement Summary
|
|
|
S-1
|
|
Risk Factors
|
|
|
S-4
|
|
Use of Proceeds
|
|
|
S-7
|
|
Description of Notes
|
|
|
S-7
|
|
Description of Certain Other
Indebtedness
|
|
|
S-21
|
|
Underwriting
|
|
|
S-22
|
|
Legal Matters
|
|
|
S-24
|
|
|
Prospectus
|
About this Prospectus
|
|
|
1
|
|
The Company
|
|
|
1
|
|
Risk Factors
|
|
|
1
|
|
Forward-Looking Statements
|
|
|
2
|
|
Ratio of Earnings to Fixed Charges
|
|
|
2
|
|
Use of Proceeds
|
|
|
2
|
|
Description of Debt Securities
|
|
|
3
|
|
Legal Matters
|
|
|
10
|
|
Experts
|
|
|
10
|
|
Where You Can Find More Information
|
|
|
10
|
|
Incorporation of Certain Documents
by Reference
|
|
|
11
|
|
$
Starbucks Corporation
% Senior
Notes due 2017
PROSPECTUS SUPPLEMENT
Goldman,
Sachs & Co.
Banc of America Securities LLC
Citi