Whole Foods 2007 Annual Report Download - page 68

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Had we previously recognized share-based payments expense as prescribed by SFAS No. 123, previously reported net
income, basic earnings per share and diluted earnings per share would have changed to the pro forma amounts shown below
(in thousands, except per share amounts):
2005
Reported net income $ 136,351
Share-based compensation expense, net of income taxes 15,309
Pro forma expense, net of income taxes (179,616)
Pro forma net income (loss) $ (27,956)
Basic earnings per share:
Reported $ 1.05
Share-based compensation expense 0.12
Pro forma adjustment (1.38)
Pro forma basic earnings (loss) per share $ (0.21)
Diluted earnings per share:
Reported $ 0.99
Share-based compensation expense 0.12
Pro forma adjustment (1.31)
Pro forma diluted earnings (loss) per share $ (0.20)
Pro forma disclosures for fiscal years 2007 and 2006 are not presented because the amounts are recognized in the
Consolidated Statement of Operations.
Team Member Stock Purchase Plan
Our Company offers a team member stock purchase plan to all full-time team members with a minimum of 400 hours of
service. Participating team members may purchase our common stock through payroll deductions. At our annual
shareholders’ meeting, on March 5, 2007, shareholders approved a new TMSPP which became effective on April 1, 2007.
The TMSPP replaces all previous stock purchase plans and provides for a 5% discount on the shares purchase date market
value which meets the “Safe Harbor” provisions of SFAS No. 123R and therefore is non-compensatory. Under the previous
plans, participating team members could elect to purchase unrestricted shares at 100% of market value or restricted shares at
85% of market value on the purchase date.
In fiscal years 2007 and 2006, we recognized approximately $0.3 million and $0.6 million, respectively, of share-based
payments expense related to team member stock purchase plan discounts. We issued approximately 83,000, 51,000 and
40,000 shares under this plan in fiscal years 2007, 2006 and 2005, respectively. At September 30, 2007, September 24, 2006
and September 25, 2005 approximately 286,000, 369,000, and 420,000 shares of our common stock, respectively, were
available for future issuance.
(14) Team Member 401(k) Plan
Our Company offers a team member 401(k) plan to all team members with a minimum of 1,000 services hours in one year.
In fiscal years 2007, 2006 and 2005, the Company made a matching contribution to the plan of approximately $2.3 million in
cash.
(15) Quarterly Results (unaudited)
The Company’s first quarter consists of 16 weeks, and the second, third and fourth quarters consist of 12 weeks. Fiscal year
2007 is a 53-week year with thirteen weeks in the fourth quarter. 2006 is a 52-week year with twelve weeks in the fourth
quarter. Because the first quarter is longer than the remaining quarters, it typically represents a larger share of our annual
sales from existing stores. Quarter to quarter comparisons of results of operations have been and may be materially impacted
by the timing of new store openings. The Company believes that the following information reflects all normal recurring
adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any
quarter are not necessarily indicative of results for any future period.