8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported) November 13, 2007

COSTCO WHOLESALE CORPORATION

(Exact name of registrant as specified in its charter)

Washington	0-20355	91-1223280
(State or other jurisdiction of incorporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

999 Lake Drive

Issaquah, WA 98027

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: 425-313-8100

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):

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

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

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

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

Item 1.01. Entry into a Material Definitive Agreement

On November 13, 2007, the Compensation Committee (the “Committee”) of the Board of Directors of Costco Wholesale Corp. (the “Company”) approved the fiscal 2008 performance criteria pursuant to which bonuses may be paid to executive officers. Under these criteria, executive officers (other than Jeffrey H Brotman, Chairman of the Board, and James D. Sinegal, President and Chief Executive Officer) are eligible to receive bonuses up to 20% of salary based on the achievement of specified targets relating to pre-tax income and operational characteristics relevant to the executive’s area of responsibility. (See Exhibit 10.1) The amounts of the actual bonuses are determined by Mr. Sinegal, subject to further approval of the Committee. Mr. Sinegal’s employment agreement for fiscal 2008 provides for a bonus amount of up to $200,000 (representing an amount up to 57% of his base salary), at the discretion of the Board of Directors or the Committee. Mr. Brotman’s bonus is at the discretion of the Board of Directors or the Committee.

On November 13, the Committee also approved final bonus awards for executive officers for fiscal 2007. Messrs. Sinegal and Brotman were awarded cash bonuses of $80,000.

On October 16 and November 13, the Committee established that it will grant restricted stock units (“RSUs”) under its Second Restated Stock 2002 Incentive Plan to the following officers in the following share amounts: Mr. Sinegal 50,000 shares; Mr. Brotman 50,000 shares; Richard D. DiCerchio (senior executive vice president) 30,000 shares; and all other executive officers 25,000 shares. Each of these grants, which are intended to qualify as “performance-based” compensation under applicable tax law, is subject to specified performance criteria for fiscal 2008. The performance targets may be satisfied by the Company’s achieving specified percentage increases, relative to fiscal 2007, in either total sales or pre-tax income for fiscal 2008. If the Committee determines that either or both of these targets have been met, then the RSUs will be granted following the end of the Company’s fiscal year and will be subject to further vesting thereafter based on the executive’s continued employment with the Company through October 2012, with 20% of the shares vesting in October of each year beginning in 2008.

Item 8.01 OTHER EVENTS

The Board of Directors on November 13 declared a quarterly cash dividend on the Company’s common stock. The dividend of $.145 per share is payable December 14, 2007, to shareholders of record at the close of business on November 30, 2007.

The Board of Directors also authorized a $1 billion increase in the Company’s share repurchase program. The authorization expires after three years.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits. The following exhibits are included in this report:

10.1.	Fiscal 2008 Executive Bonus Plan.
99.1.	Press release dated November 13, 2007.

2

SIGNATURE

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, on November 14, 2007.

COSTCO WHOLESALE CORPORATION
By:	/s/ Richard A. Galanti
	Richard A. Galanti,
	Executive Vice President and Chief Financial Officer

3

EX-10.1

Exhibit 10.1

Costco Wholesale Corporation

Executive Bonus Plan

For fiscal year 2008, executive officers (other than Jim Sinegal and Jeff Brotman) are, depending upon the individual, eligible for a bonus award of up to approximately $100,000. The final bonus amount is determined by Jim Sinegal, subject to the approval of the Compensation Committee of the Board of Directors.

Eligibility for up to 50% of the bonus amount is determined by whether the Company has met its pre-tax income goal for the year, as indicated in the Company’s internal budget.

The remaining 50% is determined by goals relevant to the executive officer’s area of responsibility:

For those whose responsibilities are operational, the goals relate to sales, controllable expenses, inventory shrinkage, and pre-tax profit in their areas of responsibility.

For those whose responsibilities are primarily buying, the goals relate to sales, gross margin, inventory shrinkage, and inventory turns in their areas of responsibility.

For those whose responsibilities combine operational and buying functions, the goals relate to a combination of those described in the prior two paragraphs.

For those whose responsibilities are staff functions, the goals relate to a combination of Company-wide operational and buying goals, in addition to qualitative factors relevant to their areas of responsibilities.

To be eligible for the annual bonus, the individual must be employed by the Company at the time bonus checks are issued (approximately November 15, 2008).

EX-99.1

Exhibit 99.1

News from

COSTCO WHOLESALE CORPORATION ANNOUNCES

QUARTERLY CASH DIVIDEND

ISSAQUAH, Wash., November 13, 2007, - Costco Wholesale Corporation (Nasdaq: COST) today announced that its Board of Directors has declared a quarterly cash dividend on Costco Wholesale common stock. The dividend of $.145 per share is payable December 14, 2007, to shareholders of record at the close of business on November 30, 2007.

Costco currently operates 524 warehouses, including 388 in the United States and Puerto Rico, 71 in Canada, 19 in the United Kingdom, five in Korea, five in Taiwan, six in Japan and 30 in Mexico. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com and at www.costco.ca in Canada. The Company plans to open an additional five new warehouses prior to the end of calendar year 2007.

CONTACTS:	Costco Wholesale Corporation
	Richard Galanti, 425/313-8203
	Bob Nelson, 425/313-8255
	Jeff Elliott, 425/313-8264

Issaquah Home Office • 999 Lake Drive • Issaquah, WA 98027-5367 • (425) 313-8100