STARBUCKS CORP 10-K

Item 9A. Controls and Procedures Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. During the fourth quarter of fiscal 2021, we carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective, as of the end of the period covered by this report (October 3, 2021). There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during our most recently completed fiscal quarter that materially affected or are reasonably likely to materially affect internal control over financial reporting. The certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 are filed as exhibits 31.1 and 31.2 , respectively, to this 10-K. Report of Management on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected. Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework and criteria established in Internal Control — Integrated Framework , issued by the Committee of Sponsoring Organizations of the Treadway Commission. This evaluation included review of the documentation of controls, evaluation of the design effectiveness of controls, testing of the operating effectiveness of controls and a conclusion on this evaluation. Based on this evaluation, management concluded that our internal control over financial reporting was effective as of October 3, 2021. Our internal control over financial reporting as of October 3, 2021 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report which is included herein. 83 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of Starbucks Corporation Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Starbucks Corporation and subsidiaries (the “Company”) as of October 3, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 3, 2021, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended October 3, 2021, of the Company and our report dated November 19, 2021, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report of Management on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte & Touche LLP Seattle, Washington November 19, 2021 84 Table of Contents Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 85 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance Information regarding our executive officers is set forth in Item 1 of Part I of this Report under the caption “Information about our Executive Officers.” We adopted a code of ethics that applies to our chief executive officer, chief financial officer, controller and other finance leaders, which is a “code of ethics” as defined by applicable rules of the SEC. This code is publicly available on our website at www.starbucks.com/about-us/company-information/corporate-governance. If we make any amendments to this code other than technical, administrative or other non-substantive amendments, or grant any waivers, including implicit waivers, from a provision of this code to our chief executive officer, chief operating officer, chief financial officer, chief accounting officer or controller, we will disclose the nature of the amendment or waiver, its effective date and to whom it applies on our website at www.starbucks.com/about-us/company-information/corporate-governance or in a report on Form 8-K filed with the SEC. The remaining information required by this item is incorporated herein by reference to the sections entitled “Proposal 1 - Election of Directors,” “Beneficial Ownership of Common Stock,” “Corporate Governance” and “Corporate Governance - Audit and Compliance Committee” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held on March 16, 2022 (the “Proxy Statement”). We will provide disclosure of delinquent Section 16(a) reports, if any, in our Proxy Statement, and such disclosure, if any, is incorporated herein by reference. Item 11. Executive Compensation The information required by this item is incorporated by reference to the sections entitled “Executive Compensation,” “Executive Compensation Tables,” “Compensation of Directors” and “Compensation Committee Interlocks and Insider Participation” in the Proxy Statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters The information required by this item is incorporated by reference to the sections entitled “Equity Compensation Plan Information” and “Beneficial Ownership of Common Stock” in the Proxy Statement. Item 13. Certain Relationships and Related Transactions and Director Independence The information required by this item is incorporated by reference to the section entitled “Certain Relationships and Related Person Transactions” and “Corporate Governance - Affirmative Determinations Regarding Director Independence and Other Matters” in the Proxy Statement. Item 14. Principal Accountant Fees and Services The information required by this item is incorporated by reference to the sections entitled “Proposal 4 - Ratification of Selection of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm - Independent Registered Public Accounting Firm Fees” and “Proposal 4 - Ratification of Selection of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm - Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of the Independent Registered Public Accounting Firm” in the Proxy Statement. 86 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (a) The following documents are filed as a part of this 10-K: 1. Financial Statements The following financial statements are included in Part II, Item 8 of this 10-K: • Consolidated Statements of Earnings for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019; • Consolidated Statements of Comprehensive Income for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019; • Consolidated Balance Sheets as of October 3, 2021 and September 27, 2020; • Consolidated Statements of Cash Flows for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019; • Consolidated Statements of Equity for the fiscal years ended October 3, 2021, September 27, 2020, and September 29, 2019; • Notes to Consolidated Financial Statements; and • Reports of Independent Registered Public Accounting Firm 2. Financial Statement Schedules Financial statement schedules are omitted because they are not required or are not applicable, or the required information is provided in the consolidated financial statements or notes described in Item 15(a)(1) above. 87 Table of Contents 3. Exhibits Incorporated by Reference Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith 2.1 Transaction Agreement, dated as of May 6, 2018, by and between Starbucks Corporation and Nestlé S.A. 8-K 0-20322 5/7/2018 2.1 3.1 Restated Articles of Incorporation of Starbucks Corporation 10-Q 0-20322 4/28/2015 3.1 3.2 Amended and Restated Bylaws of Starbucks Corporation (As amended and restated through Mar ch 17 , 20 2 1 ) 8-K 0-20322 3/19/2021 3.1 4.1 Indenture, dated as of September 15, 2016, by and between Starbucks Corporation and U.S. Bank National Association, as trustee S-3ASR 333-213645 9/15/2016 4.1 4.2 First Supplemental Indenture, dated March 17, 2017, by and between Starbucks Corporation and U.S. Bank National Association, as trustee, transfer agent and registrar, and Elavon Financial Services, DAC, UK Branch, as paying agent (0.372% Senior Notes due 2024) 8-K 0-20322 3/20/2017 4.2 4.3 Form of 0.372% Senior Note due March 15, 2024 8-K 0-20322 3/20/2017 4.3 4.4 Second Supplemental Indenture, dated as of November 22, 2017, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (2.200% Senior Notes due 2020 and 3.750% Senior Notes due 2047) 8-K 0-20322 11/22/2017 4.2 4.5 Form of 3.750% Senior Notes due December 1, 2047 (included in Exhibit 4.2) 8-K 0-20322 11/22/2017 4.4 4.6 Third Supplemental Indenture, dated as of February 28, 2018, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (3.100% Senior Notes due 2023 and 3.500% Senior Notes due 2028) 8-K 0-20322 2/28/2018 4.2 4.7 Form of 3.100% Senior Notes due March 1, 2023 8-K 0-20322 2/28/2018 4.3 4.8 Form of 3.500% Senior Notes due March 1, 2028 8-K 0-20322 2/28/2018 4.4 4.9 Fourth Supplemental Indenture, dated as of August 10, 2018, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (3.800% Senior Notes due 2025, 4.000% Senior Notes due 2028 and 4.500% Senior Notes due 2048) 8-K 0-20322 8/10/2018 4.2 4.10 Form of 3.800% Senior Notes due August 15, 2025 8-K 0-20322 8/10/2018 4.3 4.11 Form of 4.000% Senior Notes due November 15, 2028 8-K 0-20322 8/10/2018 4.4 88 Table of Contents Incorporated by Reference Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith 4.12 Form of 4.500% Senior Notes due November 15, 2048 8-K 4.13 Fifth Supplemental Indenture, dated as of May 13, 2019, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (3.550% Senior Notes due 2029 and 4.450% Senior Notes due 2049) 8-K 0-20322 5/13/2019 4.2 4.14 Form of 3.550% Senior Notes due August 15, 2029 (included in Exhibit 4.2) 8-K 0-20322 5/13/2019 4.3 4.15 Form of 4.450% Senior Notes due August 15, 2049 (included in Exhibit 4.2) 8-K 0-20322 5/13/2019 4.4 4.16 Sixth Supplemental Indenture, dated as of March 12, 2020, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (2.000% Senior Notes due 2027, 2.250% Senior Notes due 2030 and 3.350% Senior Notes due 2050) 8-K 0-20322 3/12/2020 4.2 4.17 Form of 2.000% Senior Notes due March 12, 2027 (included in Exhibit 4.2) 8-K 0-20322 3/12/2020 4.3 4.18 Form of 2.250% Senior Notes due March 12, 2030 (included in Exhibit 4.2) 8-K 0-20322 3/12/2020 4.4 4.19 Form of 3.350% Senior Notes due March 12, 2050 (included in Exhibit 4.2) 8-K 0-20322 3/12/2020 4.5 4.20 Seventh Supplemental Indenture, dated as of May 7, 2020, by and between Starbucks Corporation and U.S. Bank National Association, as trustee (1.300% Senior Notes due 2022, 2.550% Senior Notes due 2030 and 3.500% Senior Notes due 2050) 8-K 0-20322 5/7/2020 4.2 4.21 Form of 1.300% Senior Notes due May 7, 2022 (included in Exhibit 4.2) 8-K 0-20322 5/7/2020 4.3 4.22 Form of 2.550% Senior Notes due November 15, 2030 (included in Exhibit 4.2) 8-K 0-20322 5/7/2020 4.4 4.23 Form of 3.500% Senior Notes due November 15, 2050 (included in Exhibit 4.2) 8-K 0-20322 5/7/2020 4.5 4.24 Indenture, dated as of August 23, 2007, by and between Starbucks Corporation and Deutsche Bank Trust Company Americas, as trustee S-3ASR 333-190955 9/3/2013 4.1 89 Table of Contents Incorporated by Reference Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith 4.25 Second Supplemental Indenture, dated as of September 6, 2013, by and between Starbucks Corporation and Deutsche Bank Trust Company Americas, as trustee (3.850% Senior Notes due October 1, 2023) 8-K 0-20322 9/6/2013 4.2 4.26 Form of 3.850% Senior Notes due October 1, 2023 8-K 0-20322 9/6/2013 4.3 4.27 Fourth Supplemental Indenture, dated as of June 10, 2015, by and between Starbucks Corporation and Deutsche Bank Trust Company Americas, as trustee (2.700% Senior Notes due June 15, 2022 and 4.300% Senior Notes due June 15, 2045) 8-K 0-20322 6/10/2015 4.2 4.28 Form of 2.700% Senior Notes due June 15, 2022 8-K 0-20322 6/10/2015 4.3 4.29 Form of 4.300% Senior Notes due June 15, 2045 8-K 0-20322 6/10/2015 4.4 4.30 Sixth Supplemental Indenture, dated as of May 16, 2016, by and between Starbucks Corporation and Deutsche Bank Trust Company Americas, as trustee (2.450% Senior Notes due June 15, 2026) 8-K 0-20322 5/16/2016 4.4 4.31 Form of 2.450% Senior Notes due June 15, 2026 8-K 0-20322 5/16/2016 4.5 4.32 Description of Securities 10-K 0-20322 11/15/2019 4.29 10.1* Starbucks Corporation Employee Stock Purchase Plan — 1995 as amended and restated on April 9, 2015 to reflect adjustments for the 2-for-1 forward stock split effective on such date 10-Q 0-20322 8/1/2017 10.1 10.2* Starbucks Corporation Executive Management Bonus Plan, as amended and restated on June 25, 2019 10-Q 0-20322 7/30/2019 10.1 10.3* Starbucks Corporation Management Deferred Compensation Plan, as amended and restated effective January 1, 2011 10-Q 0-20322 2/4/2011 10.2 10.4* Fifth Amendment to Starbucks Corporation Management Deferred Compensation Plan 10-Q 10.5* Starbucks Corporation Deferred Compensation Plan for Non-Employee Directors, effective October 3, 2011, as amended and restated effective September 11, 2018 10-K 0-20322 11/16/2018 10.5 10.6* Starbucks Corporation 2005 Long-Term Equity Incentive Plan, as amended and restated effective March 20, 2013, as restated on April 9, 2015 to reflect adjustments for the 2-for-1 forward stock split effective on such date, and as amended and restated by the Board on September 11, 2018 10-K 0-20322 11/16/2018 10.7 90 Table of Contents Incorporated by Reference Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith 10.7* 2005 Key Employee Sub-Plan to the Starbucks Corporation 2005 Long-Term Equity Incentive Plan, as amended and restated effective November 15, 2005 10-Q 0-20322 2/10/2006 10.2 10.8* 2005 Non-Employee Director Sub-Plan to the Starbucks Corporation 2005 Long-Term Equity Incentive Plan, as amended and restated effective September 11, 2018 10-K 0-20322 11/16/2018 10.9 10.9* Form of Global Stock Option Grant Agreement for Purchase of Stock under the Key Employee Sub-Plan to the 2005 Long Term Equity Incentive Plan 10-K 0-20322 11/18/2016 10.14 10.10* Form of Stock Option Grant Agreement for Purchase of Stock under the 2005 Non-Employee Director Sub-Plan to the Starbucks Corporation 2005 Long-Term Equity Incentive Plan 10-Q 0-20322 4/26/2016 10.2 10.11 Credit Agreement, dated September 16, 2021, among Starbucks Corporation, Bank of America, N.A., in its capacity as Administrative Agent, Swing Line Lender and L/C Issuer, Wells Fargo Bank, N.A., Citibank, N.A. and U.S. Bank National Association, as L/C Issuers, and the other Lenders from time to time a party thereto. 8-K 0-20322 9/17/2021 10.1 10.12 Form of Commercial Paper Dealer Agreement between Starbucks Corporation, as Issuer, and the Dealer 8-K 0-20322 7/29/2016 10.1 10.13* Form of Time Vested Global Restricted Stock Unit Grant Agreement under the Key Employee Sub-Plan to the 2005 Long-Term Equity Incentive Plan 10-K 0-20322 11/18/2016 10.21 10.14* Form of Global Key Employee Restricted Stock Unit Grant Agreement (Effective November 2019) 10-K 0-20322 11/15/2019 10.22 10.15* Form of Global Key Employee Restricted Stock Unit Grant Agreement - No Retirement Vesting (Effective November 2020) 10-K 0-20322 11/12/2020 10.23 10.16* Form of Global Key Employee Restricted Stock Unit Grant Agreement - Retirement Vesting (Effective November 2020) 10-K 0-20322 11/12/2020 10.24 10.17* Form of Global Key Employee Stock Option Grant Agreement for Purchase of Stock under the 2005 Long-Term Equity Incentive Plan 10-K 0-20322 11/17/2017 10.25 10.18* Form of Global Key Employee Performance-Based Stock Option Grant Agreement for Purchase of Stock under the 2005 Long-Term Equity Incentive Plan 10-K 0-20322 11/16/2018 10.23 91 Table of Contents Incorporated by Reference Exhibit Number Exhibit Description Form File No. Date of Filing Exhibit Number Filed Herewith 10.19* Form of Global Key Employee Restricted Stock Unit Grant Agreement (Performance-Based - Retirement Vesting) (Effective November 2019) 10-K 0-20322 11/15/2019 10.26 10.20* Form of Global Key Employee Restricted Stock Unit Grant Agreement (Performance-Based - Retirement Vesting) (Effective November 2020) 10-K 0-20322 11/12/2020 10.29 10.21* Offer Letter dated January 6, 2021 between Starbucks Corporation and Rachel Ruggeri 8-K 0-20322 1/7/2021 10.1 21 Subsidiaries of Starbucks Corporation — — — — X 23 Consent of Independent Registered Public Accounting Firm — — — — X 31.1 Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 — — — — X 31.2 Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 — — — — X 32** Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 — — — — 101 The following financial statements from the Company’s 10-K for the fiscal year ended October 3, 2021, formatted in iXBRL: (i) Consolidated Statements of Earnings, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Equity, and (vi) Notes to Consolidated Financial Statements — — — — X 104 Cover Page Interactive Data File (formatted in iXBRL and contained in Exhibit 101) * Denotes a management contract or compensatory plan or arrangement. ** Furnished herewith. Item 16. Form 10-K Summary None. 92 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. STARBUCKS CORPORATION By: /s/ Kevin R. Johnson Kevin R. Johnson president and chief executive officer November 19, 2021 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated as of November 19, 2021. Signature Title By: /s/ Kevin R. Johnson president and chief executive officer, director (principal executive officer) Kevin R. Johnson By: /s/ Rachel Ruggeri executive vice president, chief financial officer (principal financial officer) Rachel Ruggeri By: /s/ Jill L. Walker senior vice president, Corporate Financial Services, and chief accounting officer (principal accounting officer) Jill L. Walker By: /s/ Richard E. Allison, Jr. director Richard E. Allison, Jr. By: /s/ Andrew Campion director Andrew Campion By: /s/ Mary N. Dillon director Mary N. Dillon By: /s/ Isabel Ge Mahe director Isabel Ge Mahe By: /s/ Mellody Hobson director Mellody Hobson By: /s/ Jørgen Vig Knudstorp director Jørgen Vig Knudstorp 93 Table of Contents By: /s/ Satya Nadella director Satya Nadella By: /s/ Joshua Cooper Ramo director Joshua Cooper Ramo By: /s/ Clara Shih director Clara Shih By: /s/ Javier G. Teruel director Javier G. Teruel 94