Staples 2006 Annual Report Download - page 67

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1997 United Kingdom Savings Related Share Option Plan
In August 1997, our Board of Directors adopted the 1997 United Kingdom Savings Related Share Option Plan
(the “UK Savings Plan”), pursuant to which an aggregate of 1,687,500 shares of common stock may be issued to
eligible associates whose employment relationship with Staples or a participating subsidiary is subject to United
Kingdom income tax law. The UK Savings Plan, which was approved by the Department of Inland Revenue of the
United Kingdom in December 1997, is designed to encourage eligible associates to save money and purchase shares of
our common stock at a discounted price. We filed the UK Savings Plan with the Securities and Exchange Commission
as an exhibit to our Annual Report on Form 10-K for the fiscal year ended February 1, 2003.
Each associate, including an officer or director who is also an associate, may participate in the UK Savings Plan,
provided he or she is eligible to participate in such plan under applicable United Kingdom tax law and (1) has been
employed by us or a participating subsidiary for at least 90 continuous days on the invitation date or (2) is designated
by our Board of Directors as an eligible associate.
The UK Savings Plan, which is implemented through invitations, provides eligible associates with the opportunity
to make monthly deductions from their pay of between 5 British pounds and 250 British pounds over a three-year
period for investment in an interest bearing tax-free account. The associates’ savings are used to purchase our
common stock at a discounted price equal to 15% less than the fair market value of our common stock on the
invitation date. Subject to limited exceptions, at the end of the three-year period, associates have six months to decide
whether to withdraw their savings and guaranteed bonus in cash, purchase our common stock at the discounted price,
or buy some of our common stock at the discounted price and keep some of the cash accumulation.
The UK Savings Plan is administered by our Board of Directors and the Compensation Committee of our Board
of Directors. Our Board of Directors and our Compensation Committee have the authority to make rules and
regulations for the administration of the UK Savings Plan. Pursuant to the terms of the UK Savings Plan, our Board of
Directors has appointed the Compensation Committee to administer certain aspects of the UK Savings Plan. Our
Board of Directors may at any time amend or terminate the UK Savings Plan as long as the amendment or
termination does not prejudice the rights of any participant without the prior consent of such participant. The UK
Savings Plan contains provisions relating to the exercise or disposition of options in the event of the illness, disability,
retirement, or death of the associate or a change-in-control, reconstruction or winding up of the Company.
As of February 3, 2007, approximately 3,385 associates were eligible to participate in the UK Savings Plan, under
which options cannot be granted after August 2007. The purchase of shares under the UK Savings Plan is
discretionary, and we cannot now determine the number of shares to be purchased in the future by any particular
person or group.
1997 United Kingdom Company Share Option Plan
In August 1997, our Board of Directors adopted the 1997 United Kingdom Company Share Option Plan (the
“UK Option Plan”), pursuant to which stock options for up to 1,687,500 shares of our common stock could be granted
to our associates and our subsidiaries’ associates, other than executive officers and directors. On June 17, 2004, when
our stockholders approved our Amended and Restated 2004 Stock Incentive Plan, we ceased granting stock options
under the UK Option Plan. We used the UK Option Plan to compensate associates working in our United Kingdom
businesses. Associates working in our United Kingdom businesses were also eligible to receive options under our
stockholder-approved equity plans. We filed the UK Option Plan with the Securities and Exchange Commission as an
exhibit to our Annual Report on Form 10-K for the fiscal year ended January 31, 1998.
The UK Option Plan was designed to be approved by the United Kingdom’s Department of Inland Revenue so
that associates would not be obligated to pay income tax on the difference between the exercise price of the option
and fair market value of our common stock at the option’s exercise date. The Department of Inland Revenue
approved the UK Option Plan in January 1998. Participants in the UK Option Plan could be granted, in the aggregate
over the life of the UK Option Plan, up to 30,000 British pounds of tax-advantaged options. Eligible associates could
receive additional non-tax advantaged options under the UK Option Plan.