8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

November 16, 2004

Date of Report (Date of earliest event reported)

STARBUCKS CORPORATION

(Exact name of registrant as specified in its charter)

Washington
(State or other jurisdiction of incorporation) 0-20322
(Commission File Number) 91-1325671
(IRS Employer Identification No.)

2401 Utah Avenue South
Seattle, Washington 98134

(Address of principal executive offices) (Zip Code)

(206) 447-1575

(Registrant’s telephone number, including area code)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

     o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Starbucks Corporation Executive Management Bonus Plan

Item 1.01.  Entry into a Material Definitive Agreement.

     On November 16, 2004, the Board of Directors (the “Board”) of Starbucks Corporation (the “Company”), upon a recommendation from the Compensation and Management Development Committee of the Board, established both objective and individual performance goals for performance-based bonuses payable in respect of the fiscal year ending October 2, 2005 (“Fiscal 2005”) to the executive officers of the Company under the Company’s Executive Management Bonus Plan (the “EMB Plan”). The EMB Plan is filed with this report as Exhibit 10.1. Target bonuses for the Company’s chairman and chief global strategist, president and chief executive officer and ceo designate are based on achievement of an objective performance goal only. Target bonuses for all other executive officers of the Company are weighted so that 80% of the target bonus is based on an objective performance goal and 20% is based on individual performance goals.

     The objective performance goal for each of the executive officers is based on the Company’s earnings per share for Fiscal 2005, excluding the impact of any (i) significant acquisitions or dispositions of businesses by the Company, (ii) one-time, non-operating charges or (iii) accounting changes (including the Company’s early adoption of any accounting change) mandated by any governing body, organization or authority; and adjusted for any stock split, stock dividend or other recapitalization (such measure, the “Adjusted Earnings Per Share”). Individual performance goals vary depending on the Company’s strategic plan initiatives and the responsibilities of the positions held by the executive officers. Relative weights assigned to each individual performance goal typically range from 5% to 35% of the portion of the bonus attributable to achievement of individual performance goals. The Fiscal 2005 target bonus amounts and weighting between the objective and individual performance goals for each executive officer are set forth in the table below.

	Target Bonus
	(as a			Objective			Individual
	Percentage of			Performance			Performance
Executive Officer	Base Salary)			Goals Weight			Goals Weight
chairman and chief global strategist		100	%		100	%		0	%
president and chief executive officer		100	%		100	%		0	%
ceo designate		100	%		100	%		0	%
division presidents		65	%		80	%		20	%
executive vice presidents		50	%		80	%		20	%

     The terms of the EMB Plan permit bonus payouts in excess of the target bonus in the event (as was the case in fiscal 2004) that the Company’s actual financial performance is better than the objective performance goal. For Fiscal 2005, each executive officer’s bonus could be up to 200% of the target amount. The specific Adjusted Earnings Per Share levels required for increased bonus payouts are based on a scale approved by the independent directors upon a recommendation by the Compensation and Management Development Committee.

     The following is an example of how a maximum allowable payout of 200% of the target amount could affect total bonus payouts for Fiscal 2005. This example is included for illustrative purposes only and does not represent a forecast or target by the Company of expected Adjusted Earnings Per Share for Fiscal 2005.

     Because each executive vice president participating in the EMB Plan has a target bonus of 50% of base salary, and because 80% of that target bonus is allocated to achieving the objective performance goal and 20% of that target bonus is allocated to achieving the individual performance goals, the target bonus attributed to achieving the objective performance goal is 40% of base salary (i.e., 80% x 50% = 40%)

and the target bonus attributed to achievement of the individual performance goals is 10% of base salary (i.e., 20% x 50% = 10%). If Adjusted Earnings Per Share for Fiscal 2005 were at a level permitting a payout of 200% of the target bonus, each executive vice president participating in the EMB Plan would be eligible to receive 100% of his or her base salary (80% for achieving the objective performance goal (200% x 40%) and 20% for achieving the individual performance goals (200% x 10%), assuming the executive vice president achieved all of his or her individual performance goals).

Item 5.02.  Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

     (b)       On November 17, 2004, Craig J. Foley, a member of the Board, informed the other members of the Board of his intention not to stand for re-election at the Company’s 2005 Annual Meeting of Shareholders to be held February 9, 2005 (the “Annual Meeting”). Mr. Foley informed the Board he will retire effective immediately prior to the Annual Meeting after almost 15 years of distinguished service on the Board.

Item 9.01.  Financial Statements and Exhibits.

     (c)       Exhibits.

Exhibit No.	Description
10.1	Starbucks Corporation Executive Management Bonus Plan.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STARBUCKS CORPORATION
Dated: November 22, 2004	By:	/s/ Michael Casey
		Michael Casey executive vice president and chief financial officer

EXHIBIT INDEX

Exhibit No.	Description
10.1	Starbucks Corporation Executive Management Bonus Plan.

EX-10.1

EXHIBIT 10.1

EXECUTIVE MANAGEMENT
BONUS PLAN

STARBUCKS COFFEE COMPANY

Approval by Shareholders	The material terms of the Objective Performance Goals under this Executive Management Bonus Plan will be submitted to the shareholders of Starbucks Corporation (“Starbucks” or the “Company”) on February 26, 2002. Shareholder approval of the Plan is required in order for the bonuses paid upon achievement of the Objective Performance Goals to qualify as performance-based compensation under Section 162(m) of the Internal Revenue Code.
Plan Term	Five fiscal years beginning October 1, 2001
Plan Effective Date	October 1, 2001
Plan Year	Starbucks fiscal year, which ends on the Sunday closest to September 30.
Purpose	The purpose of the Plan is to increase shareholder value by providing an incentive for the achievement of goals that support Starbucks strategic plan.
Eligibility	Starbucks partners serving in positions of executive vice president and above and other senior officers of the Corporation, as designated by the Compensation and Management Development Committee (the “Compensation Committee”) of the Board of Directors, are eligible to participate in the Plan.
	The executive vice president, Partner Resources and the chief executive officer have the authority to recommend Participants. The Compensation Committee has the sole authority to designate Participants.
	Eligibility will cease upon termination of the Participant’s employment, withdrawal of designation by the Compensation Committee, transfer to a position compensated otherwise than as provided in the Plan, termination of the Plan by Starbucks, or if the Participant engages, directly or indirectly, in any activity which is competitive with any Starbucks activity.
	If a Participant changes from an eligible position to an ineligible position during the Plan Year, eligibility to participate will be at the discretion of the Compensation Committee.
Target Bonus	The Target Bonus for each Participant shall be established by the Compensation Committee no later than ninety (90) days after the beginning of the Plan Year. The Target Bonus shall be the amount that would be paid to the Participant under the Plan if 100% of Objective Performance Goals and 100% of Individual Goals were met. The Target Bonus may be established as a percentage of Base Pay, a specific dollar amount, or according to another method established by the Compensation Committee. The amount of the Target Bonus earned by the Participant shall be based on the achievement of Objective Performance Goals and Individual Performance Goals.
	Base Pay is the annual pay rate established for the Participant by Starbucks and in effect on the last day of the Plan Period or, in the case of a deceased or disabled Participant, on the last day of participation in the Plan. Starbucks, in conjunction with the Compensation Committee, may at any time, in its sole discretion, prospectively revise the Participant’s Base Pay.

Goals
Ø Objective Performance Goals	•	In accordance with Section 162(m) of the Internal Revenue Code, the Compensation Committee shall select one or more objective performance goal measures from among Earnings Per Share, Return on Capital, Sales Growth and Volume, and/or Return on Assets for the Objective Performance Goals. The Compensation Committee shall select the Objective Performance Goals for each Participant no later than ninety (90) days after the beginning of the Plan Year and while the outcome is substantially uncertain.
	•	The Compensation Committee shall select the amount of the Target Bonus for each Participant that will be determined by achievement of the Objective Performance Goals.
	•	The Compensation Committee may establish any special adjustments that will be applied in calculating whether the Objective Performance Goals have been met to factor out extraordinary items no later than ninety (90) days after the beginning of the Plan Year and while the outcome is substantially uncertain.
	•	If the Objective Performance Goals selected by the Compensation Committee are not met, no bonus related to those goals is payable under the Plan.
ØIndividual Goals	•	The portion of the Target Bonus not determined by achievement of the Objective Performance Goals shall be determined by the Participant’s achievement of Individual Goals.
	•	Each Participant with Individual Goals shall submit such Individual Goals for approval by the Compensation Committee.
	•	The maximum performance level for each Individual Goal is 100%.
Bonus Payout and Eligibility	Bonus Payout for each Participant is based on the achievement of the Objective Performance Goals and the Individual Goals. A Bonus Payout under this Plan is earned as of the end of the Plan Year and will be paid according to the Plan, if the Participant:
	1)	remains a Starbucks partner through the end of the Plan Year, unless employment is terminated prior to the end of the Plan Year due to death or disability, and
	2)	refrains from engaging during the Plan Year, directly or indirectly, in any activity that is competitive with any Starbucks activity.
	The Compensation Committee, in its discretion, may determine that the Bonus Payout for any Participant will be less than (but not greater than) the amount earned by such Participant under the Plan.
Bonus Payout Calculation	Within ninety (90) days after the beginning of the Plan Year and while the outcome is substantially uncertain, the Compensation Committee shall review and approve for each Participant: the target bonus; the Objective Performance Goals; and the relative weighting of the Goals for the Plan Year. Those metrics will be used to calculate the Bonus Payout for each Participant. The Compensation Committee shall review the Bonus Payout Calculation for each Participant. The maximum Bonus Payout for the achievement of Objective Performance Goals is $3,500,000, to any one Participant in any plan year.

Bonus Payout Prorations	For any partner who meets eligibility criteria and becomes a Participant after the start of the Plan Year or whose employment with Starbucks is terminated prior to the end of the Plan Year because of disability or death, the Compensation Committee (1) shall prorate the Bonus Payout related to the Objective Performance Goals, and (2) in its discretion, may prorate the Bonus Payout related to Individual Performance Goals. If the Participant is on a leave of absence for a portion of the Plan Year, the Compensation Committee in its discretion may reduce the Participant’s Bonus Payout on a pro-rata basis.
	The proration is based on the number of full months during which the Participant participated in the Plan during the Plan Year. Credit is given for a full month if the Participant is eligible for 15 or more calendar days during that month.
	If a Participant changes positions within Starbucks the Plan Year, the Compensation Committee in its discretion may prorate the Participant’s Bonus Payout by the number of months in each position.
Administration	Compensation Committee Responsibilities: Approve the Plan design, Objective Performance Goals, and Individual Goals for each Participant. Determine and certify the achievement of the Objective Performance Goals and Individual Goals. Approve the Bonus Payout calculation and Bonus Payout for each Participant.
	In the event of a dispute regarding the Plan, the Participant may seek resolution through the executive vice president, Partner Resources and the Compensation Committee. All determinations by the Compensation Committee shall be final and conclusive.
Bonus Payout Administration	The Bonus Payout will be made as soon as administratively feasible and is expected to be within approximately 75 days after the end of the Plan Year. No amount is due and owing to any Participant before the Compensation Committee has determined the Bonus Payout.
	The Company will withhold amounts applicable to Federal, state and local taxes, domestic or foreign, required by law or regulation. Contributions for Future Roast 401(k) and Management Deferred Compensation Plan (MDCP) are deducted from cash Bonus Payouts, based on the Participants elections then in effect.
Termination of Employment	The Plan is not a contract of employment for any period of time. Any Participant may resign or be terminated at any time for any or no reason. Employment and termination of employment are governed by Starbucks policy and not by the Plan.
Revisions to the Plan	The Plan will be reviewed by the executive vice president, Partner Resources and the Compensation Committee on a periodic basis for revisions. Starbucks reserves the right at its discretion with or without notice, to review, change, amend or cancel the Plan, at any time.