NOTE L – STOCK OPTIONS

We have a Stock Option Plan (the “Plan”). Pursuant to the Plan, stock options

may

be granted to officers and our key employees which qualify as incentive stock options as well as stock options which are nonqualified. The exercise price of incentive stock options is at least the fair market value of the common stock on the date of grant. The exercise price for nonqualified options is determined by a committee of the Board of Directors. The options are generally exercisable after

three

years and expire

later than

ten

years from date of grant. There are

624,000

shares reserved under the Plan for which options have

not

yet been issued. There are options that were issued under prior option plans that have since been replaced that are still outstanding.

We have an Employee Stock Purchase Plan (“ESPP”) whereby employees purchase stock by making contributions through payroll deductions for

six

month periods. The purchase price of the stock is

85%

of the lower of the market price of the stock at the beginning of the

six

-month period or the end of the

six

-month period. In fiscal years

2018,

2017

and

2016

employees purchased

12,763,

13,271

and

13,747

shares at average purchase prices of

$119.39,

$105.85

and

$96.00,

respectively. ESPP expense of

$423,000,

$363,000

and

$305,000

was recognized for fiscal years

2018,

2017

and

2016,

respectively.

A summary of the status of our stock option plans as of fiscal years

2018,

2017

and

2016

and the changes during the years ended on those dates is represented below:

	Incentive Stock Options					Nonqualified Stock Options
				Weighted-					Weighted-
	Stock			Average		Stock			Average
	Options			Exercise		Options			Exercise
	Outstanding			Price		Outstanding			Price

Balance, September 27, 2015		332,352		$	77.04		297,941		$	63.34
Granted		120,450			108.69		58,720			112.35
Exercised		(86,223	)		53.67		(44,777	)		42.53
Canceled		(10,792	)		97.07		-			-

Balance, September 24, 2016		355,787			92.81		311,884			75.56
Granted		121,508			129.35		59,786			129.94
Exercised		(78,114	)		65.49		(60,156	)		41.46
Canceled		(6,200	)		100.93		-			-

Balance, September 30, 2017		392,981			109.41		311,514			92.58
Granted		122,595			141.07		58,083			144.41
Excercised		(64,470	)		90.75		(37,328	)		56.85
Canceled		(17,550	)		115.21		-			-

Balance, September 29, 2018		433,556		$	120.90		332,269		$	105.66
Exercisable Options September 29, 2018		86,153		$	97.32		155,680		$	79.35

The weighted-average fair value of incentive stock options granted during fiscal years ended

September 29, 2018,

September 30, 2017

and

September 24, 2016

was

$23.68,

$18.84

and

$13.94,

respectively. The weighted-average fair value of non-qualified stock options granted during the fiscal years ended

September 29, 2018,

September 30, 2017

and

September 24, 2016

was

$31.44,

$24.82

and

$19.95,

respectively. The total intrinsic value of stock options exercised was

$6.8

million,

$10.1

million and

$8.4

million in fiscal years

2018,

2017

and

2016,

respectively.

The total cash received from these option exercises was

$7.4

million,

$5.8

million and

$5.3

million in fiscal years

2018,

2017

and

2016,

respectively; and the actual tax benefit realized from the tax deductions from these option exercises was

$1.7

million,

$3.0

million and

$1.6

million in fiscal years

2018,

2017

and

2016,

respectively.

The following table summarizes information about incentive stock options outstanding as of

September 29, 2018:

			Options Outstanding						Options Exercisable
			Number		Weighted-				Number
			Outstanding		Average		Weighted-		Exercisable		Weighted-
			at		Remaining		Average		at		Average
Range of			September 29,		Contractual		Exercise		September 29,		Exercise
Exercise Prices			2018		Life		Price		2018		Price
$81.67	-	$113.15		198,303		1.8	$	103.75		86,153	$	97.32
$128.78	-	$146.03		235,253		3.9		135.36		-		-
Total options				433,556		3.0		120.90		86,153		97.32

The following table summarizes information about nonqualified stock options outstanding as of

September 29, 2018:

			Options Outstanding						Options Exercisable
			Number		Weighted-				Number
			Outstanding		Average		Weighted-		Exercisable		Weighted-
			at		Remaining		Average		at		Average
Range of			September 29,		Contractual		Exercise		September 29,		Exercise
Exercise Prices			2018		Life		Price		2018		Price
$41.75	-	$57.33		60,000		2.9	$	48.89		60,000	$	48.89
$80.79	-	$119.44		154,400		4.3		103.73		95,680		98.45
$129.26	-	$150.89		117,869		5.8		137.07		-		-
Total options				332,269		4.6		105.66		155,680		79.35