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 11, 2010
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)
Registrants 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 11, 2010, the Compensation Committee (the Committee) of the Board of Directors of Costco Wholesale Corp. (the Company) approved the fiscal 2011 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, Chief Executive Officer) are eligible to receive bonuses up to around 20% of salary based on the achievement of specified targets relating to pre-tax income and operational characteristics relevant to the executives 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. Sinegals employment agreement for fiscal 2011 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. Brotmans bonus is at the discretion of the Board of Directors or the Committee.
On November 13, the Committee established performance targets for grants of restricted stock units (RSUs) under its Fifth Restated Stock 2002 Incentive Plan to the following officers in the following share amounts for fiscal 2011: Mr. Sinegal 25,000 shares; Mr. Brotman 50,000 shares; W. Craig Jelinek (President and Chief Operating Officer) 40,000 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 2011. The performance targets may be satisfied by the Companys achieving specified percentage increases, relative to fiscal 2010, in either total sales or pre-tax income for fiscal 2011. 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 Companys fiscal year and will be subject to further vesting thereafter based on the executives continued employment with the Company through October 2014, with 20% of the shares vesting in October of each year beginning in 2010.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits. The following exhibits are included in this report:
10.1. | Fiscal 2011 Executive Bonus Plan. |
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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 12, 2009.
COSTCO WHOLESALE CORPORATION | ||
By: | /s/ Richard A. Galanti | |
Richard A. Galanti, | ||
Executive Vice President and Chief Financial Officer |
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