UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
 
SCHEDULE 14A
 
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Exchange Act of 1934 (Amendment No.__)
 
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NORDSTROM, INC.
 
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(Name of Registrant as Specified Inin Its Charter)
 
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1617 Sixth Avenue, Seattle, Washington 98101
April 12, 20198, 2021
Dear Shareholder,

You are invited to join us online May 23, 2019, at 9 a.m. Pacific Daylight Time for the 2019 Annual Meeting of Shareholders via webcast. We also invite you to attend the meeting in person, which will take placeTo say 2020 was unlike anything our Company has experienced in the John W. Nordstrom Room onpast 120 years would be an understatement. We faced numerous challenges that forced us to rethink the 5th floorway we work, but one thing that didn’t change was how proud we are of our people. Their dedication, passion and genuine concern for our customers and each other was a bright light throughout these tough times. From our Alterations team sewing medical grade masks for health care workers to our Restaurant team providing warm meals to employees in Texas impacted by winter storms, our people consistently extended themselves to each other, bringing the true meaning of service to life. We have always felt fortunate to have a team of people who care so much, and that is especially true right now. It is because of them we were able to navigate the past year and now have so many exciting opportunities in front of us.
Like everyone, we struggled to fully understand the early implications of COVID-19. When we decided to temporarily close all our stores, it became clear we needed quick action to respond to the crisis. After ensuring the health and safety of our employees and customers, our top priority was the financial health of the Downtown Seattle Nordstrom, at 1617 Sixth Avenue.
As a company,Company. This led to an intense focus on cash and our balance sheet. These efforts paid off as we made significant strides throughout 2018. Our generational investments — which include Manhattan, Canada, Nordstromrack.com/Hautelookgenerated positive operating cash flow from Q2 forward and Trunk Club —solidified our balance sheet so we could continue to scaleinvest in the future.
The pandemic brought significant change to the retail industry and improveour business, as customers adopted new ways of shopping and new expectations around how they want to receive their purchases and make returns. Most of that change proved to be an acceleration of trends we’ve been seeing for several years; ones we’ve been directly investing in profitability. Our customer baseand working toward. Fortunately for us, it was not a question of whether we were going in the right direction. It was about how quickly we could get there.
We prioritized finding ways to increase our speed and flexibility to better serve customers. Technology serves as a differentiator for us, enabling us to work more efficiently while being more responsive and compelling to customers. We looked at our most important strategic priorities in this area and accelerated those plans. One example of this approach is as strong as everthe integration of our Nordstrom Rack and NordstromRack.com inventories, which allowed us to fulfill online orders from our Rack stores. We had planned for this capability to launch in 2021, but the pandemic made this work more critical, so we went live with it in October 2020.
We launched Nordstrom.com in 1998 and the importance of e-commerce has steadily increased since then. We entered the year with a large digital business that made up more customers shopping across multiple channels,than 30% of our 2019 sales. The pandemic greatly accelerated this trend, and digital made up 54% of our 2020 sales. We are currently a predominantly digital business and we are seeing deeper engagement withanticipate that trend will only continue in the coming years. That’s quite something for a retailer that started as a shoe store in 1901.
Stores have been and will continue to be incredibly important for us, but their role must evolve as well. In the short term, we pivoted quickly to offer contactless, curbside services that gave our customers through The Nordy Club loyalty programconvenience and peace of mind during the pandemic. For the long term, having connected capabilities between our local market strategy. We aimstores and digital platforms has shifted from a “nice to continue this momentum by focusing on our three strategic pillars: providinghave” to a differentiatedbusiness essential. It’s that level of connection that enables us to scale online order fulfillment (which results in increased product offering, delivering exceptional servicesselection) and experiences, and leveraging the strengthallows Nordstrom.com orders to be picked up or returned at any of our brand.
We recognize the retail environment is rapidly evolving and we continuously reinvest in our business while solving customer needs in new and relevant ways. Because of this, we have built a business modelNordstrom or Nordstrom Rack stores – all services that is a key point of difference in the market. It enableswill allow us to serve customers across multiple touchpoints — throughon their terms. We’re continuing to prioritize these types of integration opportunities that give us a competitive advantage.
While the last year was disruptive in many ways, it was also an opportunity for us to step back, ask ourselves tough questions and create change. We did that and asked ourselves what kind of Company we wanted to be for our employees and our customers. Our impact extends beyond our stores and online Full-Priceoperations, so when we think about how we can bring value, environmental sustainability needs to be a priority. We have had great results, but we are the first to admit we have a long way to go. We continue to push ourselves to be a better, more responsible Company and Off-Price,are aggressively working toward our 2025 Corporate Social Responsibility Goalsfocused on environmental sustainability, corporate philanthropy and human rights. Progress isn’t possible without partnership so we are collaborating with other retailers and brands to address the climate and environmental crisis.
For all of which increases engagement and spend.
In all thatus, our purpose comes from not just what we do, but how we remaindo it. We have firmly rooted commitments to inclusivity, equity, humanity, transparency and caring for each other. These are not just words to us, they are the beliefs and standards we hold ourselves to each day. Events of 2020 put those beliefs at the forefront as we confronted issues of race, inequality and division. More than ever, we are committed to managingbe a part of the businesssolution which is why we established measurable Diversity, Inclusion and Belonging Goals. We will no doubt stumble from time to time, but we are sincere in the best interest oflistening and learning from our customers, employees and shareholders. As a shareholder, onecommunities. It is their input and support that will guide our efforts and drive our progress.
Looking forward to 2021 and beyond, we are encouraged by our opportunities to reach new levels of your rights is to vote, which can be done online,customer service and gain market share by telephone or by using a printed proxy card as outlined in this document. In addition to this Proxy Statement,expanding not only who we encourage you to view our online Letter to Shareholders at investor.nordstrom.com and read our 2018 Annual Report. There you will find a more complete picture of our performanceserve, but where and how we serve them. We are workingbuilding on our efforts over the past few years and are calling this new focus Closer to increase shareholder valueYou. Our future growth is tied to three key areas: winning in our most important markets, driven largely by improving the customer experience.expanding our Market Strategy; growing our Rack business by offering a wider range of price points; and expanding our digital capabilities to support both our brands.

Thank you








NORDSTROM, INC. - 2021 Proxy Statement 2

The progress and lessons learned in 2020 will continue to be top of mind for us. The need for speed, flexibility and agility was not unique to a pandemic era. It is a sign of what is to come and the capabilities that will be core to our long-term success. We are continuing to embed these characteristics into all facets of our business so we can be responsive to the ever-changing needs and expectations of our customers.
During times of transformation and uncertainty, it is more critical than ever to keep our focus and priorities clear. We are here to help our customers feel good and look their best. Though the ways we do that will continue to change, customer service is as important today as it has ever been. Improving customer service continues to be our number one goal, and we know it is the biggest differentiator between us and other retailers. Our entire Company is aligned around this goal, and it is our collective job as leaders to enable our teams to do just that: focus on behalf of all ofthe customer. We are humbly reminded every day that is what brought us at Nordstrom for your continued support.here and it is how we are going to succeed going forward.
Sincerely,
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Brad D. Smith
Chairman of the Board
 
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Peter E. NordstromErik B. Nordstrom
Co-PresidentPresident and Chief Brand OfficerCo-President
Chief Executive Officer


3 NORDSTROM, INC. - 20192021 Proxy Statement 4



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1617 Sixth Avenue, Seattle, Washington 98101
Notice of Annual Meeting
of Shareholders
Thursday, May 23, 2019 
9:00 a.m. Pacific Daylight Time
John W. Nordstrom Room, 5th floor, Nordstrom Downtown Seattle Store, 1617 Sixth Avenue, Seattle, Washington 98101
The 2019 Annual Meeting of Shareholders (the “Annual Meeting”) of Nordstrom, Inc. (the “Company”) will be held for the following purposes:
Items of Business
To vote on the following proposals:
1To elect 10 Director nominees named in this Proxy Statement to the Board to serve until the 2022 Annual Meeting of Shareholders
1.To elect 11 Directors to serve until the 2020 Annual Meeting of Shareholders;
2.2To ratify the appointment of Deloitte & Touche LLP (“Deloitte”) as the Company’sour Independent Registered Public Accounting Firm to serve for the 20192022 fiscal year;year
3.3To conduct an advisory vote regarding the compensation of our Named Executive Officers;NEOs
4.To approve the Nordstrom, Inc. 2019 Equity Incentive Plan; and
5.4To transact any other business that may properly come before the Annual Meeting and any adjournment or postponement thereof.thereof
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WHEN
Wednesday, May 19, 2021
9:00 a.m. Pacific Daylight Time
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WHERE
virtualshareholdermeeting.com/JWN2021
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RECORD DATE
March 10, 2021
You are eligible to vote before the Annual Meeting, during the live webcast of the Annual Meeting and any adjournment or postponement thereof, if you were a shareholder of record at the close of business on March 15, 201910, 2021 (the “Record Date”). There were 154,952,755157,770,380 shares of the Company’s Common Stock issued and outstanding as of March 15, 2019.
Shareholders10, 2021. Holders of the Company’s Common Stock are invitedentitled to attendcast one vote per share on each proposal. For further information on how to participate in the meeting, please see Frequently Asked Questions and Answers About the Annual Meeting beginning on page 65 in person. Those who are hearing impaired or require other assistance should contact the Company at 206-303-3040 so that we may facilitate your participation at the Annual Meeting.Proxy Statement accompanying this Notice.
YOUR VOTE IS VERY IMPORTANT. Whether or not you intend to be present atparticipate virtually in the Annual Meeting via remote communication, you are encouraged to vote.vote in advance of the meeting. Submitting your proxy now will not prevent you from voting your shares during the meeting, as your proxy is revocable at your option. When you vote, please have available the 16-digit control number found on your Notice of Internet Availability or proxy card.
You may vote In advance of the meeting, until 11:59 p.m. Eastern Daylight Time on May 18, 2021 using any of the following methods:
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Online
At proxyvote.com
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Toll-free Phone
Call 1-800-690-6903
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Mail
Vote Processing
c/o Broadridge
51 Mercedes Way Edgewood, NY 11717
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Scanned QR Code
Using your mobile device
Seattle, Washington
April 12, 20198, 2021
By order of the Board of Directors,
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Robert B. SariAnn Munson Steines
Corporate Secretary







IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 20192021 ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON May 23, 2019MAY 19, 2021
The accompanying Proxy Statement and the 20182020 Annual Report on Form 10-K are available at investor.nordstrom.comthe Investor Relations Website.

Certain statements in this proxy statement contain or may suggest “forward-looking” information (as defined in the Private Securities Litigation Reform Act of 1995) that involves risks and uncertainties that could cause results to be materially different from expectations. The words “will,” “may,” “designed to,” “outlook,” “believes,” “should,” “targets,” “anticipates,” “assumptions,” “plans,” “expects” or “expectations,” “intends,” “estimates,” “forecasts,” “guidance” and similar expressions identify certain of these forward-looking statements. The Company also may provide forward-looking statements in oral statements or other written materials released to the public. All statements contained or incorporated in this proxy statement or in any other public statements that address such future events or expectations are forward-looking statements. Important factors that could cause actual results to differ materially from these forward-looking statements are detailed in the Company’s 2020 Annual Report. These forward-looking statements are not guarantees of future performance and speak only as of the date made, and, except as required by law, the Company undertakes no obligation to update or revise any forward-looking statements to reflect subsequent events, new information or future circumstances.

NORDSTROM, INC. - 20192021 Proxy Statement 54



PROXY SUMMARY
You have received these proxy materials because the Board is soliciting your proxy to vote your shares during the 2021 Annual Meeting of Shareholders. This summary highlights information described in more detailcontained elsewhere in this Proxy Statement. Itproxy statement. This summary does not contain all of the information that you should consider in deciding how to vote your shares, and you should read the entire Proxy Statementproxy statement carefully before voting. Page references (“XX”) are providedsupplied to help you find further information.
2019information in this proxy statement. Please refer to our Index of Key Terms Annual Meetingon page 7 for the meaning of Shareholderscertain terms used in this summary and the rest of this proxy statement.
Date and Time:    May 23, 2019 at 9:00 a.m. Pacific Daylight TimeMeeting Webcast:    
investor.nordstrom.com, select Events & Presentations and follow the instructions given. The webcast will be archived and available for one year following the Annual Meeting.
Place:John W. Nordstrom Room, 5th floor
Nordstrom Downtown Seattle Store
1617 Sixth Avenue
Seattle, Washington 98101
EligibilityThis proxy statement and the related proxy materials were first released to Vote
You are eligible to vote if you were a shareholdershareholders and made available on the internet on April 8, 2021. Shareholders who held shares as of record at the close of business on March 15, 2019.the record date can attend the virtual meeting at virtualshareholdermeeting.com/JWN2021.
How to Cast Your VoteProposal No. 1 - Election of Directors (page 77)18)
You can vote by any of the following methods:
Nominee Demographics
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Gender
Internet:(www.proxyvote.com), until 11:59 p.m. Eastern Daylight Time on May 22, 2019;*Mail:by completing, signing and returning your proxy or voting instruction card on or before May 22, 2019; or
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Telephone:if you requested printed materials, by using the toll-free number listed on your proxy card until 11:59 p.m. Eastern Daylight Time on May 22, 2019;
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In person:if you are a shareholder of record, by voting your shares at the Annual Meeting. If your shares are held in the name of a broker, nominee or other intermediary, you must obtain a proxy, executed in your favor, to bring to the meeting.
Voting Matters (page 76)
  
Board Vote
Recommendation
 
Page Reference 
(for more detail)

1.Election of DirectorsFOR each Director Nominee 19
2.Ratification of the Appointment of Independent Registered Public Accounting FirmFOR 25
3.Advisory Vote Regarding Executive CompensationFOR 
4.Approval of the Nordstrom, Inc. 2019 Equity Incentive PlanFOR 

6 NORDSTROM, INC. - 2019 Proxy Statement  


Board of Directors Nominees (page 21)
Name Age 
Director
Since
 Occupation Committee Memberships 
Other Public
Company Boards
Shellye L. Archambeau* 56 2015 Former Chief Executive Officer of MetricStream, Inc. Corporate Governance and Nominating, Technology Verizon, Inc., Okta, Roper Technologies, Inc.
Stacy Brown-Philpot* 43 2017 Chief Executive Officer of TaskRabbit, Inc. Audit and Finance, Technology HP Inc.
Tanya L. Domier* 53 2015 Chief Executive Officer of Advantage Solutions Audit and Finance, Compensation (Chair) YUM! Brands, Inc.
Kirsten A. Green* 47 2019 Founder and Managing Partner of Forerunner Ventures Audit and Finance, Technology  
Glenda G. McNeal* 58 2019 President Enterprise Strategic Partnerships of American Express Compensation, Corporate Governance and Nominating RLJ Lodging Trust
Erik B. Nordstrom 55 2006 Co-President of Nordstrom, Inc. N/A  
Peter E. Nordstrom 57 2006 Co-President of Nordstrom, Inc. N/A  
Brad D. Smith* 55 2013 Executive Chairman of Intuit, Inc. Compensation, Corporate Governance and Nominating Intuit, Inc., SurveyMonkey
Gordon A. Smith* 60 2015 Co-President and Chief Operating Officer of JPMorgan Chase & Co. Compensation, Corporate Governance and Nominating (Chair)  
Bradley D. Tilden* 58 2016 Chairman and Chief Executive Officer of Alaska Air Group, Inc. Audit and Finance (Chair) Alaska Air Group, Inc.
B. Kevin Turner* 54 2010 President and Chief Executive Officer of Core Scientific Corporate Governance and Nominating, Technology (Chair)  
*IndependenceIndependent Director

Governance of the Company (page 10)
9 of 11 Director nominees are independent.
Independent Directors meet regularly in executive session.
The roles of Co-Presidents and Chairman of the Board are separate.
Only independent Directors are Committee members.
Director elections have a majority voting standard and all Directors are elected annually.
The Board has stock ownership guidelines for Directors and Executive Officers.
Board, Committee and Director performance evaluations are conducted annually.
The Board and its Committees are responsible for risk oversight.
Co-President and management succession planning is one of the Board’s highest priorities.


NORDSTROM, INC. - 2019 Proxy Statement 7



Business Highlights
In fiscal year 2018, net earnings were $564 million, or $3.32 per diluted share, which included a $0.05 favorable income tax benefit related to prior periods and an estimated non-recurring credit-related charge of $0.28 (see page 42 of the Company’s Annual Report on Form 10-K for the fiscal year ended February 2, 2019). We achieved net sales of $15.5 billion. This compares to $15.1 billion in 2017, which included $220 million for the 53rd week associated with the 4-5-4 retail calendar. We maintained a strong financial position, generating annual operating cash flow of more than $1 billion for the 10th consecutive year and returning nearly $1 billion to shareholders through dividends and share repurchases during the year.
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Tenure
Achieved $15.5B
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40% Female/
60% Male
(4 of 10 Nominees are female)
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80% Independent
All committee members are independent
Separate roles for Chairman and CEO
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40% of Director Nominees
appointed in sales, reflecting scalingthe last 4 years
10-year term limit for independent directors






EthnicityAge2020 Board Engagement
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30% Ethnic Diversity
(3 of our generational investments.10 Nominees are
Black/African American)
Grew comparable sales 1.7%, reflecting Full-Price increase of 0.9%
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57 years
average Nominee age
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99% overall attendance rate at Board and Off-Price increase of 3.5%.
Generated earnings of $564M, reflecting lower income tax expense associated with corporate tax reform.Committee meetings
6 Board and 20 Committee meetings
Continuous engagement to advise in relation to COVID-19 response
Our business model is a key point of difference in serving customers in multiple ways — through stores, online, Full-Price and Off-Price — with meaningful synergies across Nordstrom. We are focused on leveraging our digital and physical assets to provide customers with a best-in-class experience. In 2018, we achieved the following milestones in executing our customer strategy through our three strategic pillars: providing a compelling product offering, delivering outstanding services and experiences, and leveraging the strength of the Nordstrom brand:
We continued to see positive customer trends. In 2018, over 35 million customers shopped with us, an increase of 6% from last year. One-third of our customers shopped across our multiple channels, which generally leads to higher customer spend.
Digital sales increased 16% and made up 30% of net sales. Additionally, Nordstrom.com achieved scale, with the profitability of Full-Price digital sales at parity with store sales. We believe our early investments to build a robust digital business have given us a competitive advantage.
Our generational investments continued to scale, contributing approximately $2 billion in sales and an improvement in profitability. Nordstromrack.com/HauteLook became our fastest business to reach $1 billion in sales. Trunk Club delivered sales growth of 35%. We opened our Men’s Store in New York City and furthered our expansion into Canada with the introduction of six Nordstrom Rack stores.
We launched our local market strategy in Los Angeles, which drove outsized market share gains in this market by increasing product selection, delivery speed and convenience for customers.
As we aspire to be the best fashion retailer in a digital world, we believe we are well positioned to deliver a differentiated customer experience and drive increased shareholder value.
Executive Compensation Highlights - Paying For Performance
In accordance with our pay-for-performance philosophy, the compensation program for our Named Executive Officers is straightforward in design and includes four primary elements: base salary, performance-based bonus, long-term incentives (“LTI”) and benefits. Within these elements, we emphasize variable pay over fixed pay, with at least 70% of each Named Executive Officer’s target compensation linked to our financial or market results. The program also balances the importance of these executives achieving both critical short-term objectives and strategic long-term priorities. The following graphics represent target compensation for the Co-Presidents and the other Named Executive Officers, as shown on page 29.

85 NORDSTROM, INC. - 20192021 Proxy Statement


Relevant Skills and Experience
The nominees possess a balance of leadership experiences, diverse perspectives, strategic skill sets and professional expertise that are essential in furthering our business strategy and objectives, including:
Retail IndustryCEO Experience
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77
Online Scale & GrowthFinancial Literacy
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87
Business TransformationTechnology Expertise
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96
Marketing & Customer ExperienceRisk Management Experience
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107
graph040919a01.jpgThe Board recommends a vote FOR each Director nominee.
Our Variable Pay Reflects CompanyProposal No. 2 - Ratification of Independent Accountants (page 26)
Qualified and Experienced Independent Auditors
Deloitte & Touche LLP is an independent registered accounting firm that has served Nordstrom for more than 50 years.
The firm’s expertise and fees are appropriate for the scope of the Company’s needs.
The Board recommends a vote FOR this proposal.
Proposal No. 3 - Advisory Vote Regarding Executive Compensation (page 59)
Compensation Aligned with Performance
Our pay-for-performance design includes rigorous performance goals and high performance standards. Further, with a substantial portion of pay in the form of Nordstrom stock, pay outcomes alignExecutive compensation program aligns with our shareholders’ experience. This is evidenced bystrategy and our Named Executive Officers’ recent incentivepay-for-performance philosophy.
We deliver the majority of compensation payouts and grant realizable values as of our 2018 fiscal year end, as shown below.
INCENTIVE COMPENSATION PAYOUTS 2014
 2015
 2016
 2017
 2018
Incentive Earnings Before Interest and Income Tax Expense (“Incentive EBIT”) $1,391M $1,246M $1,076M $952M $909M
Incentive Adjusted Return on Invested Capital
(“Incentive Adjusted ROIC”)
 13.6% 11.0% 12.4% 10.0% 12.8%
Annual bonus
(payout as a % of Target*)
 83% 0% 80% 96% 89%
3-year TSR percentile ranking within comparator group 63%ile
 53%ile
 16%ile
 10%ile
 24%ile
Performance Share Unit (“PSU”) vesting
(payout as a % of Target)
 75% 75% 0% 0% 0%
PSU comparator group Retail
 Retail
 S&P 500
 S&P 500
 S&P 500
*Actual bonus payout for fiscal year 2017 as a % of Target for the Co-Presidents was 94%. Actual bonus payout for fiscal year 2018 as a % of Target for the Co-Presidents was 63%. See pages 35 and 36 for more information.
Incentive EBIT and Incentive Adjusted ROIC are not measures of financial performance under Generally Accepted Accounting Principles (“GAAP”) and should be considered in addition to, and notthrough a substitute for, return on assets, net earnings, total assets or other financial measures prepared in accordance with GAAP. See Appendix A for a reconciliation of GAAP and non-GAAP financial measures. PSU vesting as shown in the table above corresponds to the performance periods ending in fiscal years 2014 through 2018. Three-year Total Shareholder Return (“TSR”) percentile ranking is based on our TSR performance over three-year rolling periods between fiscal years 2012 and 2018 versus the comparator group. Beginning with the 2014 – 2016 performance period, we changed our comparator group from our retail peer group to the Standard and Poor’s 500. See page 37 to learn more about long-term incentive pay.
GRANT REALIZABLE VALUES 2014
 2015
 2016
 2017
 2018
PSUs (realizable value as a % of grant value) 0% 0% 0% 51% N/A
RSUs (realizable value as a % of grant value) 94% 75% 111% 111% 94%
Stock options (realizable value as a % of grant value) 38% 0% 6% 6% N/A
Realizable values shown abovepay-for-performance framework where incentives are based on the actual value at timeachieving results. Approximately 85% of vest, current unvested values using our2018 CEO’s fiscal year end stock price of $45.33and current performance for the outstanding PSUs granted in 2017 (which were tracking at 50% payout as of the end of the fiscal year), shown as a percent of grant value. PSUs, restricted stock units (“RSUs”)2020 target compensation was based on achieving goals related to EBIT, ROIC, free cash flow and stock options are shown in the column matching the year of grant.market share.
Our Incentive Adjusted EBIT achievement fell below our threshold milestone of $645 million, resulting in a zero bonus payout.
TheFiscal Year 2020 Target Compensation Committee reviews these results and other analyses with the goal of ensuring that the Named Executive Officers’ aggregate compensation aligns with shareholder interests. Based on these and other outcomes, the Compensation Committee believes that total direct compensation for our Named Executive Officers reflects our pay-for-performance objective and is well aligned with shareholder interests.
For more information on executive compensation, please see the Compensation Discussion and Analysis starting on page 29.
Chief Executive Officer and
President & Chief Brand Officer
All Other Named Executive
Officers Combined
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85%75%
Performance BasedPerformance Based

The Board recommends a vote FOR this proposal.

NORDSTROM, INC. - 20192021 Proxy Statement 96


Back to Contents

INDEX OF KEY TERMS
TermDefinition
2020 Annual ReportCompany’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended January 30, 2021
2025 Corporate Social Responsibility GoalsReview our 2025 Corporate Social Responsibility goals at nordstromcares.com
53rd WeekThe extra week included in fiscal 2017 as a result of our 4-5-4 retail reporting calendar
AFCAudit and Finance Committee of the Board of Directors
ASC 718Accounting Standards Codification 718, Stock Compensation
BoardThe Board of Directors
BroadridgeBroadridge Investor Communication Services
CD&ACompensation Discussion & Analysis
CEOChief Executive Officer
CFOChief Financial Officer
CGNCCorporate Governance and Nominating Committee of the Board of Directors
ChairmanOur Board Chairman, a non-Executive position
Common StockNordstrom common stock
CPCCCompensation, People and Culture Committee of the Board of Directors
DDCPNordstrom Directors Deferred Compensation Plan
DeloitteDeloitte & Touche LLP
Diversity, Inclusion and Belonging GoalsReview our Diversity, Inclusion and Belonging goals at nordstrom.com/diversity
EBITEarnings (Loss) Before Interest and Taxes
EIPEquity Incentive Plan
EMBPExecutive Management Bonus Plan
ESPPEmployee Stock Purchase Plan
Exchange ActSecurities Exchange Act of 1934
FASBFinancial Accounting Standards Board
GAAPU.S. Generally Accepted Accounting Principles
Incentive Adjusted EBITIncentive Adjusted Earnings Before Interest and Income Tax Expense
Incentive Adjusted ROICIncentive Adjusted Return on Invested Capital
Investor Relations WebsiteOur investor relations website, found at investor.nordstrom.com
IRCInternal Revenue Code
Lease StandardAccounting Standards Update 2018-11, Leases
LLCHangar Three LLC
LTILong-Term Incentives
NDCPNordstrom Deferred Compensation Plan
NEONamed Executive Officer
NYSENew York Stock Exchange
PAOPrincipal Accounting Officer
PEOPrincipal Executive Officer
PFOPrincipal Financial Officer
Plan TrusteeBank of New York Mellon, as trustee of the Nordstrom 401(k) Plan
PSUPerformance Share Unit
Record DateShareholder of record at the close of business on March 10, 2021
RSURestricted Stock Unit
SECSecurities and Exchange Commission
Semler BrossySemler Brossy Consulting Group, LLC
SERPSupplemental Executive Retirement Plan
Tax ActCorporate tax reform in 2017, known as the Tax Cuts and Jobs Act
TCTechnology Committee of the Board of Directors
TSRTotal Shareholder Return

7 NORDSTROM, INC. - 2021 Proxy Statement

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TABLE OF CONTENTS
NORDSTROM, INC. - 2021 Proxy Statement 8

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9 NORDSTROM, INC. - 2021 Proxy Statement

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CORPORATE GOVERNANCE
Our Corporate Governance Framework
Since its founding, our Company’s leaders and employees have always sought to maintain the highest ethical standards in every aspect of our business. Our corporate governance framework is designed to support this tradition of integrity, trust
and unyielding commitment to do the right thing, which has served our customers and shareholders well over the years. Our corporate governance framework, more fully discussed on the following pages, includes the following highlights:
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10 NORDSTROM, INC. - 2019 Proxy Statement  


Board Responsibilities, Leadership Structure, and Role in Risk Oversight
The Board of Directors (“Board”) oversees, counsels and directs management in promoting the long-term interests of the Company and our shareholders. The Board’s responsibilities include:
determining the appropriate structure for the senior leadership of the Company;
selecting and evaluating the performance of the Co-Presidents;CEO and President and Chief Brand Officer;
planning for succession with respect to the positionsposition of the Co-PresidentsCEO and monitoring management’s succession planning for other senior executives;
reviewing and approving our major financial objectives, our strategic and operational plans and other significant actions;
monitoring the conduct of our business and the assessment of our business risks to promote the proper management of the business;
overseeing the management of cybersecurity, including oversight of appropriate risk mitigation strategies, systems, processes and controls; and
overseeing the processes for maintaining integrity with regard to our financial statements and other public disclosures, and compliance with laws and our Code of Business Conduct and Ethics.
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At this time, the Board believes different people should hold the positions of Chairman of the Board and Co-Presidents, CEO, as this may strengthen corporate governance and aid in the Board’s oversight of management. Currently, Brad D. Smith serves as Chairman of and Erik B. Nordstrom serves as the Board and Erik Nordstrom and Peter Nordstrom serve as Co-Presidents.CEO. The Co-Presidents areCEO is responsible for day-to-day leadership and performance of the Company, while the Chairman of the Board provides guidance to the Co-Presidents CEO and presides over the full Board. The duties of our Chairman of the Board are more fully described in the Chairman of the Board and Presiding Director section below. The Board believes this leadership structure also aids in the Board’s oversight and management of risk.
The full Board has primary responsibility for oversight of risk management and has assigned to the Board’s standing Committees the task of focusing on the specific risks inherent in their respective areas of oversight. The full Board:
considers and determines the Company’s risk appetite, which is the amount of risk the organization is willing to accept;
oversees management’s implementation of an appropriate system to manage risks (i.e., to identify, assess, mitigate, monitor and communicate these risks) and monitors the effectiveness of this process as the business environment changes;
provides risk oversight through the Board’s committee structure and processes; and
manages directly certain risks, in particular, the risks associated with the Company’s strategic direction, which are reviewed at an annual strategy planning meeting and periodically throughout the year.
The Company has a comprehensive, structured approach to managing risks, which are identified, assessed, prioritized and managed at all levels within the Company through an enterprise risk management process which is aligned with the
Company’s strategy. Within this framework, management is responsible for assessing and managing the Company’s exposure to risks. Management regularly reports on risks to the relevant Committee or the Board. The Board and its Committees discuss the various risks confronting the Company throughout the year, particularly when reviewing operating and strategic plans and when considering specific actions for approval. The risks are classified into four major categories: Strategic, Compliance, Operational and Financial, and mapped for the appropriate management and Board (and Committee) oversight.
Through the risk oversight process, the Board: (i)
obtains an understanding of the risks inherent in the Company’s strategy and management’s execution of the strategy within the agreed risk appetite; (ii)
accesses useful information from internal and external sources about the critical assumptions underlying the strategy; (iii)
is alert for possible dysfunctional behavior within the organization which might lead to excessive risk taking; (iv)
provides input to executive management regarding critical risk issues on a timely basis; and (v)
encourages open communication and appropriate escalation of reporting of risk throughout the enterprise, striving to ensure that risk management is part of the corporate culture.
The Board’s leadership structure and the collective knowledge and experience of its members promotes a broad perspective, open dialogue and useful insights regarding risk, thereby increasing the effectiveness of the Board’s role in risk oversight.


NORDSTROM, INC. - 2019 Proxy Statement 11



Director Independence
A Director is considered independent when our Board affirmatively determines that he or shethe Director has no material relationship with the Company, other than as a Director. Our Board makes this determination in accordance with the standards set forth in our Corporate Governance Guidelines, which are consistent with the listing standards of the New York Stock Exchange (“NYSE”)NYSE and Securities and Exchange Commission (“SEC”)SEC rules. In making this determination, the Board considers
existing relationships between the Company and the Director, whether directly or as a partner, shareholder or officer of an organization that has a relationship with the Company. The Board has affirmatively determined that each of the following Director nominees, areexcept Erik Nordstrom and Peter Nordstrom, is independent within the meaning of the listing standards of the NYSE, SEC rules and the Company’s Corporate Governance Guidelines, and none of these Director nominees have a material relationship with the Company other than as a Director:Guidelines.
Shellye L. ArchambeauKirsten A. GreenGordon A. Smith
Stacy Brown-PhilpotGlenda G. McNealBradley D. Tilden
Tanya L. DomierBrad D. SmithB. Kevin Turner
Chairman of the Board and Presiding Director
The Company has a Chairman of the Board who is also an independent Director and who serves as the Presiding Director within the meaning of the listing standards of the NYSE. Currently, Brad D. Smith serves as the Company’s Chairman of the Board.
The Chairman of the Board is appointed annually by the Board. As described in the Company’s Bylaws, Corporate Governance Guidelines and Chartercharter of the Corporate Governance and Nominating Committee,CGNC, the Chairman of the Board:Chairman:
presides at meetings of the Board;
assists in establishing the agenda for each Board and Board Committee meeting;
serves as the Presiding Director to lead regular executive sessions at each meeting of the Board in which only independent Directors participate;
calls special meetings of the Board and/or the shareholders;
provides input and support to the Chair of the Corporate Governance and Nominating CommitteeCGNC on nominees to fill vacant Board seats and the selection of Committee Chairs and membership on Board Committees;
advises the Co-PresidentsCEO and other members of the Executive Team on such matters as strategic direction, corporate governance and overall risk assessment; and
performs such other duties as the Board may from time to time delegate to assist the Board in the fulfillment of its responsibilities.

1211 NORDSTROM, INC. - 20192021 Proxy Statement


Director Elections
The Company’s Bylaws provide that, in an uncontested election, a Director nominee will be elected if the number of votes cast for the nominee’s election exceeds the number of votes cast against the nominee’s election. An incumbent Director nominee who fails to receive the requisite votes for election will continue to serve as a Director until the earlier of: (i) 90 days from the date on which the voting results of the
election are determined; or (ii) the date on which an individual is selected by the Board to fill the position held by such Director. In any election which is a contested election (meaning that the number of directorDirector nominees exceeds the number of directors to be elected), the standard for election of directors is a plurality of the votes cast by holders of shares entitled to vote in the election at a meeting.
Management Succession Planning
The Board and management believe that one of their primary responsibilities is to ensure the Company has the appropriate leadership capability to effectively deliver upon its business commitments. The Company’s management is actively engaged and involved in leadership development, having regular discussions of the leadership capabilities of the organization and the attraction, development and retention of critical talent to promote future success. In addition to the Company’s regular review of leadership capabilities, the Board annually conducts a detailed review of the talent strategies for the entire organization and reviews succession plans for senior leadership positions, including thosethat of the Co-Presidents.CEO. The Board reviews high-potential employees, evaluates plans to develop their management and leadership capabilities and sanctions the strategies used to deploy these individuals most effectively. In addition to the annual review, succession is regularly discussed in executive sessions of the Board and in Board
Committee meetings, as applicable. Directors become familiar with potential successors for key leadership positions through various means, including the comprehensive annual talent and succession review, Board meeting presentations and less formal interactions throughout the course of the year.
Our entire Board with the oversight of our Corporate Governance and Nominating Committee, is responsible for implementing succession procedures for the Co-Presidents.CEO. We believe the Board, led by our Chairman, should collaborate with the Co-Presidents CEO on the critical aspects of the succession planning process, including establishing selection criteria, identifying and evaluating candidates and making management succession decisions. The Board has procedures in place to respond to an unexpected vacancy in one or more of the Co-Presidents’ positions,CEO position, including a detailed review of the succession plan annually by the Board. It is the Board’s practice to be prepared for a planned or unplanned change in leadership in order to ensure the stability of the Company.
Communications with Directors
Shareholders and other interested parties may communicate with Directors by contacting the Corporate Secretary’s Office at:
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Telephone: 206-303-2541
7
Email:board@nordstrom.com
*
Mail: Nordstrom, Inc.
1700 Seventh Avenue, Suite 1500
Seattle, Washington 98101-4407
Attn: Corporate Secretary
The Corporate Secretary will relay the question or message to the specific Director with whom the shareholder or interested party wishes to communicate.
If no specific Director is requested, the Corporate Secretary will relay the question or message to the Chairman of the Board. Certain items that are unrelated to the duties and responsibilities of the Board, such as business solicitations, advertisements, junk mail and other mass mailings will not be relayed to Directors.
The Audit and Finance Committee has established procedures to respond to possible concerns about ethics and accounting-related practices. To report your concerns, you may use the Company’s confidential Whistleblower Hotline at:
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Telephone: 1-888-832-8358
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Internet:ethicspoint.com
Your concerns will be investigated and communicated to the Audit and Finance Committee, as necessary.


NORDSTROM, INC. - 2019 Proxy Statement 13



Board Committees and Charters 
The Board has afour standing committees: Audit and Finance Committee,(“AFC”); Compensation, Committee,People and Culture (“CPCC”); Corporate Governance and Nominating Committee,(“CGNC”); and Technology Committee.(“TC”). Each Committee has a Board-approved Chartercharter which is reviewed annually by the respective Committee. Recommended changes to the charter, if any, are submitted to the Corporate Governance and Nominating CommitteeCGNC and the Board for approval. The Board makes Committee and Committee Chair assignments annually
at its meeting immediately following the Annual Meeting, although further changes to Committee assignments may be made from time to time as deemed appropriate by the Board. The Board has determined that the Chairs and all Committee members are independent under the applicable NYSE rules. Committee Charterscharters and current Committee membership are posted on our website at investor.nordstrom.com and may be viewed by selecting the Corporate Governance item in the Investor Relations drop-down menu. The Chairs and members of the Committees as of the date of this Proxy Statement are identified in the following table.Website.
DirectorAudit and Finance CommitteeCompensation CommitteeCorporate Governance and Nominating CommitteeTechnology Committee
Shellye L. Archambeau
ü
ü
Stacy Brown-Philpot
ü
ü
Tanya L. Domierü
chairicon.gif
Kirsten A. Greenüü
Glenda G. McNealüü
Philip G. Satre*üü
Brad D. Smithü
ü
Gordon A. Smithü
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Bradley D. Tilden
chairicon.gif
B. Kevin Turner
ü
chairicon.gif
Chair
*Mr. Satre is not seeking re-election and will be retiring from the Board at the end of his current term in May 2019.
Audit and Finance Committee
This committee was formed from the merger of the Audit Committee and Finance Committee in May 2018.
As more fully described in its Charter,charter, the primary responsibilityresponsibilities of the Audit and Finance Committee isAFC are to assist the Board in fulfilling its oversight responsibility by reviewing and discussing:with respect to:
the integrity of the Company’s financial statements;
the accounting, auditing and financial reporting processes of the Company;
the management of business and financial risk and the internal controls environment;
the Company’s compliance with legal and regulatory requirements and ethics programs as established by management and the Board, in conjunction with any recommendations by the Corporate Governance and Nominating CommitteeCGNC with respect to corporate governance standards;
the reports resulting from the performance of audits by the independent auditor and the internal audit team;
the qualifications, independence and performance of the Company’s independent auditors; and
the performance of the Company’s internal audit team.
In addition, the Audit and Finance CommitteeAFC provides financial oversight, including:
assisting the Board in fulfilling its oversight responsibilitiesincluding with respect to to:
the Company’s capital structure, financial policies, capital investments, business and financial planning and related matters;
reviewing and discussing the Company’s tax strategies and the implications of actual or proposed tax law changes;
reviewing and discussing
NORDSTROM, INC. - 2021 Proxy Statement 12

the Company’s dividend payment and share repurchase strategies, banking relationships, borrowing facilities and cash management; and
monitoring the ratings assigned by rating agencies to the Company’s long-term debt.compliance with covenants under its outstanding indebtedness and borrowing facilities.
The Audit and Finance CommitteeAFC regularly reviews accounting, auditing and financial reporting processes, enterprise risk management, and compliance with laws and regulations. The Audit and Finance CommitteeAFC also meets privately and separately with the independent registered public accounting firm, the Chief Financial OfficerCFO and the Vice President, Internal Audit.

14 NORDSTROM, INC. - 2019 Proxy Statement  


In addition to meeting the independence requirement for audit committee members, the Board has determined that each current member of the Audit and Finance CommitteeAFC also meets the financial literacy and experience requirements contained in the corporate governance listing standards of the NYSE. The Board has determined that all Audit and Finance Committee members qualify as “audit committee financial experts” underWhile the regulations of the SEC. Although all members of the Audit and Finance Committee meet the current regulatory requirements for accounting or related financial management expertise and the Board has determined that each of them qualifies as an “audit committee financial expert,” members of the Audit and Finance CommitteeAFC are not professionally engaged in the practice of auditing or accounting and are not technical experts in auditing or accounting.accounting, the Board has determined that all AFC members qualify as “audit committee financial experts” under the regulations of the SEC.
Compensation, People and Culture Committee
As more fully described in its Charter,charter, the primary responsibilities of the Compensation Committee are:CPCC are to assist the Board in fulfilling its oversight responsibility with respect to:
approving anthe overall compensation philosophy for the Company’s Executive Officers in light of the Company’s goals and objectives. The Executive Officers are referenced on pages 27 and 28 and include the Named Executive OfficersNEOs shown in the Compensation Discussion and AnalysisCD&A on page 29 and other business unit presidents and Company executives overwith responsibility for major organizational functions reportingwho report to the Co-PresidentsCEO or other senior executives;
selectingthe selection of performance measures aligned with the Company’s business strategy;
reviewing and approving the Company’s cash and equity-based compensation plans for executives;
recommending to the Boardannual review of the formoverall performance of the CEO and amount of Director compensation;President and Chief Brand Officer;
reviewing and approving any benefit plans, retirement and deferred compensation or other perquisites offered to the Executive Officers and other eligible employees;
compensation risk assessment; and
reviewing the Company’s compensation practices so that they do not encourage imprudent risk taking.key talent initiatives such as diversity, inclusion and belonging.
The CommitteeCPCC has the sole authority to retain such consultants and advisors as it may deem appropriate and to approve related fees and other retention terms. The CommitteeCPCC has retained
Semler Brossy, Consulting Group, LLC (“Semler Brossy”), an independent compensation consulting firm, to advise the CommitteeCPCC on executive compensation and benefit matters. Semler Brossy provides services only as directed by the Committee.CPCC. During fiscal year 2018,2020, Semler Brossy’s services included a review of executive and director pay programs, performance goal-setting, alignmenta review of the compensation peer group, a review of pay and performance, and other pay-related matters specific to the Compensation Committee’s Charter. CPCC’s charter. The Compensation CommitteeCPCC has assessed the independence of Semler Brossy pursuant to NYSE rules and determined that Semler Brossy is independent under the rules of the NYSE and that its work for the Compensation CommitteeCPCC does not raise any conflict of interest.

A consultant from Semler Brossy attends CommitteeCPCC meetings in person or by phone and supports the CommitteeCPCC by providing independent expertise on market practices and trends in executive compensation within the general industry and the peer group defined for such purposes. Additionally, the consultant provides advice regarding the composition of the Company’s peer group and analysis of peer group practices for base salary, performance-based bonus, long-term incentivesLTIs and other compensation elements, and advice on management’s proposed levels of executive compensation. Semler Brossy also advises the CommitteeCPCC on compensation program design, including incentive structure, stock ownership guidelines, regulatory requirements related to executive compensation, plans submitted to shareholders for approval, governance responsibilities, and such other matters as assigned by the CommitteeCPCC from time to time as necessary to carry out its responsibilities under its Charter.charter.
Corporate Governance and Nominating Committee
As more fully described in its Charter,charter, the primary responsibilities of the Corporate Governance and Nominating Committee are:CGNC are to assist the Board in fulfilling its oversight responsibility with respect to:
reviewing and recommendingthe recommendation of individuals to the Board for nomination as members of the Board and its Committees;
reviewingthe evaluation of possible conflicts of interest of Board members and the Company’s Executive Officers;
developing and reviewing the Company’s Corporate Governance Guidelines;
reviewing and considering revisions to
the corporate governance standards contained in the Company’s Codes of Business Conduct and Ethics;
reviewing and recommending approval of the policies and practices of the Company in the area of corporate governance;
producing and providingthe recommendation to the Board anof the form and amount of Director compensation;
the annual performance evaluation of the Board, the Directors and each Committee of the Board; and
establishingthe establishment of succession procedures in the case of an emergency or the retirement of one or both Co-Presidents; and
reviewing the overall performance of the Co-Presidents on an annual basis.CEO.


13 NORDSTROM, INC. - 20192021 Proxy Statement15



Technology Committee
As more fully described in its Charter,charter, the primary responsibilities of the Technology Committee are:
assistingTC are to assist the Board in fulfilling its oversight responsibility with respect to to:
the Company’s technology strategy;
reviewing and discussing the Company’s technology acquisition and development process to assureensure ongoing business growth;
reviewing and discussing
the Company’s data management and automation processes, and measurement and tracking systems;
reviewing and discussing the Company’s policies and safeguards for information technology and data security;security, as well as risks and
making recommendations to the Board incidents with respect to information technology and data security; and
investments in technology.
Board Meetings and Attendance
The Board held 9six formal meetings during fiscal year 2018,2020, one of which was devoted principally to Company strategy. During the past fiscal year, the Audit CommitteeAFC held 5seven formal meetings, the Finance CommitteeCPCC held 2four formal meetings, the combined Audit and Finance CommitteeCGNC held 8 meetings after merging in May 2018, the Compensation Committee held 6 meetings, the Corporate Governance and Nominating Committee held 5five formal meetings, and the Technology CommitteeTC held 4four formal meetings. In addition, the Board participated in numerous informal calls and discussions during the early months of the COVID pandemic. Each Director attended at least 75% of the aggregate of all formal meetings of the Board and the Committees on which he or shethey served during the year, and overall attendance at theformal meetings, on a combined basis, was 94%99%. Independent members of the Board met at each regularformal meeting of the Board in executive session without management present. Directors are expected to attend the Annual Meeting of Shareholders, if practicable. All Directors attended the 2020 Annual Meeting of Shareholders.
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Director Compensation
The Company’s pay-for-performance philosophy for Director compensation reflects the Board’s belief that payment of a majority of the Director fees in the form of Nordstrom common stock (“Common Stock”)Stock aligns the interests of Directors with the interests of the Company’s shareholders and enhances Director compensation when the Company performs well. The Board believes that the Director fees paid by the Company should be competitive with other companies ofhaving similar characteristics.
Employee Directors of the Company are not paid any fees for serving as members of the Board. NonemployeeNon-employee Director compensation consistsis discussed below.
Changes for 2020
At the February 2020 Board meeting, after consideration of recommendations made by the CPCC’s compensation consultant, the following elements:pay component changes were made to Director Compensation beginning in fiscal year 2020 to better align pay with that of our peer companies. The last material change to Director Compensation was in 2014.
Cash Retainers
increased the annual Director Retainer from $85,000 to $95,000;
increased the annual CPCC Chair Retainer from $20,000 to $25,000; and
increased the annual CGNC Chair Retainer from $15,000 to $20,000.

Subsequent to the meeting, based on the uncertainty surrounding the impact of COVID-19 on business operations and to enhance the Company’s liquidity, the Directors agreed to rescind their action with respect to an increase in fees. Inaddition, the Directors agreed to reduce their 2020 cash retainers by 50% and defer payment of their remaining cash retainers for the six months immediately following the 2020 Annual Meeting.
Annual Compensation Elements for 2018
AmountStock Awards
The annual Director Equity Grant of Common Stock was increased from a grant date fair value of $140,000 to a grant date fair value of $150,000.
Stock Ownership Guidelines
In addition to the changes to the Director Compensation components, the Board increased the Director Stock Ownership Guidelines to require Directors to own Common Stock having a value of at least $450,000 by their fifth anniversary of joining the Board. This was an increase from the former requirement of $425,000.
($)*

Director Retainer85,000
Audit and Finance Committee Chair Retainer20,000
Compensation Committee Chair Retainer20,000
Corporate Governance and Nominating Committee Chair Retainer15,000
Technology Committee Chair Retainer15,000
Special Committee Member Retainer**20,000
Special Committee Working Member Retainer**35,000
Special Committee Chair Retainer**100,000
Director Equity Grant of Common Stock having a grant date value of140,000
Chairman of the Board Equity Grant of Common Stock having a grant date value of200,000
*Directors may elect to take some or all of their cash retainer fees in Common Stock.
**In addition to the standing board committees identified above, the Board formed a special committee, consisting of: Ms. Archambeau, Ms. Brown-Philpot, Mr. Satre, Mr. Brad Smith, Mr. Gordon Smith, Mr. Tilden, and Mr. Turner, in connection with the announcement in June 2017 by the Nordstrom family that it was exploring the potential of a going-private transaction. This special committee was disbanded in March 2018, following the conclusion of that process.
Under the Director Stock Ownership Guidelines, Directors are currently required to own Common Stockshares having athe requisite value of at least $425,000 by their fifth anniversary of joining the Board. As of March 15, 2019,10, 2021, each nominee for election at the Annual Meeting had either satisfied this obligation or had time remaining to do so. Under the Company’s policy, a Director will be deemed to be in compliance with the Stock Ownership Guidelines once their holdings of Common Stock meet or exceed the threshold, and will remain in compliance, notwithstanding any decline in the value of Common Stock, unless and until the Director sells shares.

16 NORDSTROM, INC. - 20192021 Proxy Statement 14


Scheduled Annual Compensation Elements for 2020*Amount ($)**
Director Retainer85,000 
AFC Chair Retainer30,000 
CPCC Chair Retainer20,000 
CGNC Chair Retainer15,000 
TC Chair Retainer15,000 
Director Equity Grant of Common Stock having a grant date value of150,000 
Chairman of the Board Equity Grant of Common Stock having a grant date value of200,000 
* In fiscal year 2020, scheduled cash retainers were reduced, as discussed in the comments below.
** Directors may elect to take some or all of their cash retainer fees in Common Stock.
Changes for 2021
No changes were made to Director Compensation for fiscal year 2021.
Director Summary Compensation Table
During the fiscal year ended February 2, 2019, nonemployeeJanuary 30, 2021, non-employee Directors of the Company received the following compensation for their services:
NameFees Earned
or Paid in Cash
($)(a)(b)
Stock
Awards
($)(b)(c)
All Other
Compensation
($)(d)
Total
($)
Shellye L. Archambeau50,000 149,990 4,202204,192
Stacy Brown-Philpot50,000 149,990 1,428201,418
Tanya L. Domier52,500 149,990 15,148217,638
James L. Donald42,500 149,990 — 192,490
Kirsten A. Green42,500 149,990 12,623205,113
Glenda G. McNeal42,500 149,990 — 192,490
Brad D. Smith42,500 349,999 2,466394,965
Bradley D. Tilden57,500 149,990 5,013212,503
Mark J. Tritton42,500 149,990 17,590210,080
Name
Fees Earned
or Paid in Cash
($)(a)(b)

 
Stock
Awards
($)(b)(c)

 
All Other
Compensation
($)(d)

 
Total
($)

Shellye L. Archambeau105,000
 139,977
 10,395
 255,372
Stacy Brown-Philpot105,000
 139,977
 4,804
 249,781
Tanya L. Domier105,000
 139,977
 17,722
 262,699
Kirsten A. Green*
 
 
 
Glenda G. McNeal*
 
 
 
Philip G. Satre185,000
 339,929
 2,068
 526,997
Brad D. Smith105,000
 239,968
 3,228
 348,196
Gordon A. Smith120,000
 139,977
 13,937
 273,914
Bradley D. Tilden125,000
 139,977
 4,237
 269,214
B. Kevin Turner135,000
 139,977
 27,186
 302,163
*Kirsten Green and Glenda McNeal were appointed on February 26, 2019, and received no compensation in fiscal year 2018.
(a) Fees Earned or Paid in Cash
The amounts reported reflect the cash fees paid to each nonemployeenon-employee Director, whether or not such fees were deferred or taken as Common Stock. Ms. Archambeau and Ms. Brown-Philpot received $20,000 in cash for their services as Special Committee Members and elected to take their retainers in Common Stock.deferred. Ms. Domier received $20,000 for service as the Compensation Committee Chair. Mr. Satre received $100,000 for his service as Chair of the Special Committee. Mr. Brad Smith received $20,000 for his service as a Special Committee Member. Mr. Gordon Smith received $20,000$10,000 in cash for his service as a Special Committee Member and elected to take his retainer and $15,000 for service as Chair of the Corporate Governance and Nominating CommitteeCPCC. Ms. Archambeau received $7,500 in Common Stock. Mr. Tilden received $20,000cash for service as Chair of the Audit and Finance Committee and $20,000 as a Special Committee Member.CGNC. Mr. TurnerTilden received $35,000$15,000 in cash for service as a Special Committee Working Member and elected to receive his retainer and $15,000 as Chair of the Technology CommitteeAFC. Ms. Brown-Philpot received $7,500 in Common Stock.cash for service as Chair of the TC.
Based on the uncertainty surrounding the impact of COVID-19 on business operations and to enhance the Company’s liquidity, the Directors agreed to reduce their 2020 cash retainers by 50% and defer payment of their remaining cash retainers for the six months immediately following the 2020 Annual Meeting.
(b) Deferred Compensation Program
NonemployeeNon-employee Directors may elect to defer all or a part of their cash retainers and stock awards under the Nordstrom Directors Deferred Compensation Plan (“Directors Plan”).DDCP. Directors are required to make advance elections to defer the receipt of fees or stock awards, and all deferral elections generally are irrevocable. Directors are also required to make advance elections about the form and timing of distribution of their deferred cash fees or stock awards.
In 2018,2020, cash deferrals could be directed among 18 deemed investment alternativesand gains and losses for cash deferrals were posted to the Director’s account daily based on their investment elections. In addition, plan participants were offered a fixed rate option of 4.4%4.31% in 2018,2020, which was not subsidized by the Company, but rather was a rate based on guaranteed contractual returns from a third-party insurance company provider. Deferred stock awards are credited to the Director’s account as units. Each unit in the Directors PlanDDCP is equal in value to the price of one share of Common Stock. Each deferred unit is credited with dividends, in the form of additional units, to the same extent as a share of Common Stock.
During the fiscal year which ended February 2, 2019, Ms. Archambeau andJanuary 30, 2021, Ms. Brown-Philpot deferred 100% of theirher stock awardsaward and cash fees into the Directors Plan.DDCP.
(c) Stock Awards
The amounts reported reflect the grant date fair value associated with each Director’s stock awards. Fractional shares are not awarded or paid in cash. In recognition of the significant time and attention in performing the duties required of the position, our Chairman of the Board is annually awarded, on the date offirst open trading day following the Company’s Annual Meeting, an additional stock award having a grant date fair value of $200,000. On November 20, 2018, Brad D. Smith received an additional pro-rated stock award having a value of $99,991, after assuming the position of Chairman of the Board on November 1, 2018.


15 NORDSTROM, INC. - 20192021 Proxy Statement17



(d) All Other Compensation
All Directors, their spouses and eligible children may participate in the Company’s employee merchandise discount program. The program provides discounts ranging from 20% for eligible nonmanagementnon-management employees up to 33% for eligible management and high-performing nonmanagement non-management
employees and Directors. A 40% discount is available at certain times of the year on specified merchandise. These discounts vary somewhat by source and type of merchandise or service. During the fiscal year ended February 2, 2019, allJanuary 30, 2021, All Other Compensation consisted only of merchandise discounts for all Directors.
Compensation Committee Interlocks and Insider Participation
During the fiscal year ended February 2, 2019,January 30, 2021, no member of the Compensation CommitteeCPCC was an employee officer or former officer of the Company or any
of its subsidiaries, and no Executive Officer of thewas formerly a Company served on the board of directorsofficer, or compensation committee ofhad any entity that has one or more directors, or compensation committee of any entity that has one or more Executive Officers, serving as a member of the Company’s Board or Compensation Committee.relationship otherwise requiring disclosure.
Codes of Business Conduct and Ethics and Other Policies
We have adopted a Code of Business Conduct and Ethics that applies to all of our employees, including our Principal Executive Officer, Principal Financial Officer, Principal Accounting OfficerPEO, PFO, PAO and persons performing similar functions. We have also adopted a Directors’ Code of Business Conduct and Ethics that applies to all of our Directors. Copies of each of these Codes
are posted on our Investor Relations Website. A grant of a waiver from a provision of the codes requiring disclosure under applicable SEC rules, if any, will be disclosed on our website at investor.nordstrom.com and may be viewed by selecting the Corporate Governance item in the Investor Relations drop-down menu.Website.
We have a policy that prohibits
Hedging and Pledging Policies
Our policies prohibit Directors and Executive Officers (as well as other key insiders and their immediate family members) from engaging in hedging or short sale transactions with respect to the Company’s Common Stock. We also have a policy with respect to pledging of Common Stock, which subjects Directors and Executive Officers to a preclearance
requirement and restrictions, including that pledged shares may not be counted toward the Company’s stock ownership guidelines. Employees who are not Executive Officers or certain other key insiders are not covered by these policies. Our Executive Officers, in the aggregate, have less than 0.5% of the Company’s outstanding shares pledged to third parties and are in compliance with our policy.parties.
Corporate Social Responsibility
Our goal
Leaving It Better Than We Found It
Over the last year, our world, industry and company have forever changed as we have all experienced events and faced levels of adversity that lack any sort of blueprint. But we have also seen new levels of compassion, community and inspiration as we all worked to support each other. While there is still a great deal of uncertainty, we have adapted and emerged more committed than ever to deliver on our intention to leave the world better than we found it.
As a company, we believe the impacts we have on our employees, customers and communities extend well beyond the walls of our stores. We have an obligation to ensure we operate as a responsible company our employees can be proud of. The idea that we have a role to play in building and shaping a positive, inclusive and sustainable future is not new to us, but it has become more important than ever. Last year, we accelerated our efforts and reaffirmed our commitment to our three Corporate Social Responsibility priorities: Environmental Sustainability, Corporate Philanthropy, and Human Rights.
Respecting the Environment
We have more visibility than ever before into the impact our business withhas on the utmost integrityenvironment and servehow we manufacture our customers, employees and shareholders in a way that is deserving of their support and trust. Socialproducts. This means we have an increasing responsibility is one wayto mitigate those impacts whenever possible. In 2014, we strive to follow through with this commitment. We actively pursue solutionsset ambitious five-year goals to reduce our impact, nearly all of which we met or exceeded ahead of schedule. We have also launched and expanded programs to help our customers shop sustainably, as with Sustainable Style and BEAUTYCYCLE, both of which also play an important role in our future goals.
Taking Care of Our Communities
Partnering with our employees, we donated $3.5 million to 3,615 causes and organizations last year through our employee matching gift program. We also took action in creative ways, like leveraging our tailors across the country to help create nearly one million medical-grade masks to support health care workers during the shortage in March and April.
Respecting Human Rights
Our community support extends to the health, safety and human rights of all people, including our customers, our employees and those who make the products we sell. By partnering directly with factories, we work to create comprehensive and sustainable progress. We audit 100% of new Nordstrom Made factories for compliance with our Partnership Guidelines before beginning production and perform annual audits thereafter. These audits include wage and hour records and management systems. Our agreements with all factories afford us the right to conduct unannounced audits of their facilities, which we do periodically.
While we achieved our goals, our work did not stop in 2020. We spent time listening to customers, employees, company leaders, investors, sustainability experts and even brand partners to help inform our new set of goals for 2025. These goals center around climate change, environmental impact contributeof products and services and circularity; customer engagement and cause marketing, corporate grantmaking and employee engagement; and ethical working practices and women’s empowerment. For the full details on our goals and progress to leave the world better than we found it, visit nordstromcares.com.
NORDSTROM, INC. - 2021 Proxy Statement 16

Diversity, Inclusion, and Belonging
Committed to Change
We are committed to being a positive part of the change that is needed in the world. We have amplified our efforts over the past several years to promote diversity, inclusion and belonging at Nordstrom, but events in our world have accelerated this work. Since 2019, we have achieved 100% pay equity and nearly 100% pay parity. We have improved diversity throughout our Company in recent years, where women make up 45% of our current Board – nearly 30% of whom are people of color – and 60% of leadership, but we know we have more work to do. We have partnered with NAACP Legal Defense and Education Fund, Hispanic Association on Corporate Responsibility, Black Lives Matter Global Network Foundation and the National Urban League, among others, through financial support and corporate volunteerism.
Throughout 2020, we continued our listening to gain insights on the experience of our employees and customers which help inform our path forward, including setting specific goals to address our opportunities for growth. In the past year, we expanded our Employee Resource Groups to representDisabled communities in addition to our existing groups for Black, Latinx, Asian Pacific-Islander, LGBTQIA+, Women, Veterans and Parents. Additionally, we brought together diverse leaders across the company and Board to form our diversity, inclusion and belonging action council to help deliver ourdiversity, inclusion and belonging strategy, which is focused on four pillars: Talent, Culture, Marketplace and Leadership and exemplifies our commitment to change.
GOALS
Focus on our Talent
Historically, representation in our stores has been rich with ethnic and gender diversity, however this has not always been the case for our corporate population. We plan to increase demographic diversity in all our corporate and leadership positions to better reflect the North American population. By the end of 2025, we will increase representation of Black and Latinx populations in people-manager roles by at least 50%. We will leverage our internship program and other initiatives that help us reach qualified candidates early in their careers, with a goal on average of at least 50% of participants in these programs coming from underrepresented populations.
We are revisiting our practices and the training resources we offer for all customer-facing roles to ensure they include anti-racism and anti-bias content.
Improving our Culture
In 2020, we responded to the social unrest in our country by launching monthly courageous conversations with our employees and established a continuous listening survey to keep a pulse on employee sentiment. Going forward, we will take what we have learned to strengthen belonging and address favoritism through greater consistency, collaboration, communication and connection. Our Voice of the Employee survey will be our benchmark for success in this area, and we are working to improve our Inclusion and Belonging Index score by eight points and Favoritism Index score by six points by 2025.
Responding to the Marketplace
In 2020, we carefully reviewed and updated our marketing imagery to represent the customers we want to attract and the communities we represent. Looking ahead, we will serve customers on their terms, through a lens of anti-racism, identity, and equity at every touchpoint. We are committing to deliver $500 million in retail sales from brands owned by, operated by, or designed by Black and/or Latinx individuals by the end of 2025. We are also renewing our Supplier Diversity program, which will track and support diverse-owned suppliers across all areas of our business.
Aligning our Leaders
We will declare and commit to compelling, future-oriented leadership expectations and shared culture that will drive our business ambition. We will measure our leaders on their performance in this area through the Inclusion Index and feedback from their teams and coworkers. We will double our charitable giving to nonprofit organizations that promote anti-racism, bringing that total to approximately $1 million per year for the next five years. We have joined a multiyear corporate partnership with the National Urban League, a historic civil rights of workers who createorganization dedicated to economic empowerment, equality and social justice.
We have long believed that we're all made better by the diversity that exists within our products. We believe that both transparency and collaboration are key to progress in all of these areas,communities and we disclosewill continue doing our efforts in an annual Corporate Social Responsibility Report. More information can be foundpart to bring about meaningful change. Read more about our diversity, inclusion and belonging strategy, goals and progress at nordstrom.com under Nordstrom Cares. We also continue to work with and learn from interested parties. The Company does not use corporate funds to make contributions to support or oppose federal, state or local political parties, candidates, campaigns and/or ballot measures. Our statement on Political Activity may be accessed through our website at investor.nordstrom.com and may be viewed by selecting the Corporate Governance item in the Investor Relations drop-down menu.nordstrom.com/diversity.
Website Access to Corporate Governance Documents
The Charterscharters for each of the standing Committees of the Board, the Company’s Corporate Governance Guidelines, the Employee Code of Business Conduct and Ethics, and the Director Code of Business Conduct and Ethics, as well as all Company filings made with the SEC, may be accessed throughon our website at investor.nordstrom.com, and may be viewed by selecting the Corporate Governance item in the Investor Relations drop-down menu and SEC Filings.

Website.
1817 NORDSTROM, INC. - 20192021 Proxy Statement


PROPOSAL 1ELECTION OF DIRECTORS
The Board recommends a vote FOR each Director nominee.
ElevenTen nominees, recommended by the Company’s Board, will be elected at the Annual Meeting, each to hold office until the 20202022 Annual Meeting of Shareholders and until their successors have been duly elected and qualified. Tanya L. Domier is not seeking re-election and will be retiring from the Board at the end of her current term in May 2021. All of the nominees listed in this Proposal 1 are currently Directors of the Company.
Director Qualifications, Experience, and Experience
The Board, acting through the Corporate Governance and Nominating Committee, seeks a Board that, as a whole, possesses the experience, skills, backgrounds and qualifications appropriate to function effectively in light of the Company’s current and evolving business circumstances. The Committee reviews the size of the Board, the tenure of our Directors and their skills, backgrounds and experiences in determining the slate of nominees and whether to seek one or more new candidates. The Committee seeks directors with established records of significant accomplishments in businesses and areas relevant to our strategies. With respect to the nomination of continuing Directors for re-election, the individual’s prior contributions to the Board are also considered.
All of our Directors bring to our Board a wealth of executive leadership experience derived from their service as senior executives of complex corporations. As a group, they also bring extensive board experience. The process undertaken by the Committee in recommending qualified director candidates is described in the Director Nominating Process below.
Director Nominating Process
The Corporate Governance and Nominating CommitteeCGNC is responsible for identifying and recommending to the Board the nominees to stand for election as directors at each Annual Meeting of Shareholders or, if applicable, at a special meeting of shareholders.
In nominating director candidates, the CommitteeCGNC considers such factors as it deems appropriate, including whether there are any evolving needs of the Board with respect to a particular field, skill or experience.experience, with the goal of assisting the Board in providing oversight of and strategic advice to Company management. These factors may include judgment, skill, experience with businesses and other organizations, the candidate’s experience and skill set relative to those of other members of the Board and the extent to which the candidate would be a desirable addition to the Board and any Committees of the Board.
In addition to these factors, the Committee may also considerconsiders a director candidate’s diversity of background during the evaluation and selection process of director candidates. In this context, diversity is broadly construed to mean varied skills, backgrounds and experiences, which include gender and ethnicity, as well as other differentiating characteristics, all in the context of the requirements and needs of the Board at that point in time. The Committee however, does not have a formal policy regarding how diversity of background should be applied in identifying or evaluating director candidates, and, depending on the current needs of the Board, the Committee may weigh certain factors more or less heavily. The goal of the Committee is to assist the Board in attracting competent individuals with the requisite management, financial and other expertise who will act as directors in the best interests of the Company and its shareholders.

The Committee will consider the qualifications of director candidates recommended by shareholders, and evaluate each of them using the same criteria the Committee uses for incumbent candidates. Shareholders who wish to submit nominees for election as directors should follow the procedures described on page 75.64. No director candidates were recommended by our shareholders for election at the Annual Meeting.
All of our Directors bring to our Board a wealth of executive leadership experience derived from their service as senior executives of complex corporations. As a group, they also bring extensive board experience and a diversity of perspectives on the challenges facing the Company and the retail industry at this time.
The chart on the following page outlines some of the qualifications each director candidate brings to the Board. However, the lack of a mark in any specific box does not mean that the candidate does not possess that qualification. Instead, the skills and qualifications noted on the following page are those reviewed by the CGNC and the Board in making nomination decisions and as part of the Board succession planning process. We believe the combination of the skills and qualifications shown on the following page demonstrates how our Board is well positioned to provide strategic advice and effective oversight to Company management.


NORDSTROM, INC. - 20192021 Proxy Statement 1918



The following table summarizes key qualifications, skills or attributes most relevant to the decision to nominate an individual to serve on the Board. A mark indicates an area of focus or expertise on which the Board relies. The lack of a mark, however, does not mean the Director does not possess that qualification or skill.
Nominee Skills Matrix
Director Nominee
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Retail Industry
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Online Scale & Growth
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Business Transformation
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Marketing & Customer Experience
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CEO Experience
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Financial Literacy
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Technology Expertise
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Risk Management
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Shellye L. Archambeau
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Stacy Brown-PhilpotTanya
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James L. DomierDonald
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Kirsten A. Green
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Glenda G. McNeal
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Erik B. Nordstrom
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Peter E. Nordstrom
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Brad D. SmithGordon A. Smith
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Bradley D. TildenB. Kevin Turner
Global/International Commerceüü
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ü
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üüüü
Retail Industryü
ü
üüüü
eCommerce/Technologyüüüü
ü
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ü
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Senior Executive ManagementüüüMark J. Tritton
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ü
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üüü
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TOTALLegal7/108/109/1010/107/107/106/10
Customer-Focused Businessüü
ü
ü
ü
ü
üüü
ü
ü
General Business Managementüüüüü
ü
üüüüü
Communications/Marketingüüüü
ü
üüüü
Governanceüü
ü
ü
Public Company Boardüüüüü
ü
Loyalty/Rewards Programüüü7/10
No director candidates were recommended by our shareholders for election at the Annual Meeting.

2019 NORDSTROM, INC. - 20192021 Proxy Statement


Our Director Nominees
Information related to the Director nominees is set forth below, including age, and the particular experience, qualifications, attributes or skills that led the Board to conclude that the person should serve as a Director for the Company.
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Shellye L. Archambeau
Director since 2015
Age 56
FormerCareer Highlights
2002 to 2018: Chief Executive Officer of MetricStream, Inc., a global provider of governance, risk, compliance and quality management solutions to corporations across diverse industries from 2002
2001 to January 2018. Prior to joining MetricStream, Ms. Archambeau was 2002: Chief Marketing Officer and Executive Vice President of Sales for Loudcloud, Inc., a provider of Internetinternet infrastructure services from 2001
2000 to 2002; 2001: Chief Marketing Officer of NorthPoint Communications from 2000
1999 to 2001; and 2000: President of Blockbuster, Inc.’s ecommercee-commerce division from 1999
Prior to 2000. Before joining Blockbuster, Ms. Archambeau1999: held domestic and international executive positions during a 15-year career at IBM. IBM
Shellye L. Archambeau
Independent DirectorSkills and Qualifications
Joined the Board: 2015
Ms. Archambeau has been a director of Verizon, Inc. since December 2013, a director at Roper Technologies, Inc. since April 2018, and a director at Okta since December 2018. She served as a director of Arbitron, Inc. from 2005 to 2013.
Ms. Archambeau brings to the Board, among other skills and qualifications,extensive leadership experience in technology, ecommerce,e-commerce, digital media and communications. Hercommunications, each of which is critical to our success during the ongoing transformation of the retail industry. In addition, her technology and international experience positionpositions her to advise the Board and senior management on global operations and on technology innovations to elevate the customer experience.
Age 58
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Stacy Brown-Philpot
Director since 2017
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Age 43Other Current Public BoardsNordstrom Board Committee Memberships
Verizon, Inc.CGNC (Chair)
Okta Inc.TC
Roper Technologies, Inc.
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Career Highlights
2016 to 2020:Chief Executive Officer of TaskRabbit, Inc., a digital home services labor platform company since April 2016. Previously, Ms. Brown-Philpot served as the company’s
2013 to 2016: Chief Operating Officer from January 2013 to April 2016. From May 2012 to December 2012, Ms. Brown-Philpot was an of TaskRabbit, Inc.
2012: Entrepreneur-in-Residence at Google Ventures, the venture capital investment arm of Alphabet, Inc.
Prior to that, she spent nearly a decade, from 2003 to 2012, in2012: various directorial positions at Google, including two years as the company’s senior directorSenior Director of global consumer operations. Ms. Brown-Philpot also has a background in finance where she served as a senior analystGlobal Consumer Operations; Senior Analyst at Goldman SachsSachs; Senior Associate at PriceWaterhouseCoopers
Stacy Brown-Philpot
Independent DirectorSkills and senior associate at PricewaterhouseCoopers. She has been a director of HP Inc. since 2015.Qualifications
Joined the Board: 2017
Ms. Brown-Philpot brings to the Board innovation, operational and entrepreneurial experience, digital, branding and marketing expertise, as well as financial and accounting skills. She provides unique insights to elevate the consumer experience in a global digital economy.economy as well as needed insights into the attraction and retention of technology talent, with a particular emphasis on technology talent from underrepresented communities. Her service on the board of HP, Inc. provides her with experience in corporate governance matters and key skills in working with directors, understanding board processes and functions, assessing risk and overseeing management.
Age 45
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Tanya L. Domier
Director since 2015
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Age 53Other Current Public BoardsNordstrom Board Committee Memberships
HP, Inc.AFC
TC (Chair)
NORDSTROM, INC. - 2021 Proxy Statement 20

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Career Highlights
2019 to present: Co-Chairman of the Board for Albertsons Companies, one of the largest food and drug retailers in the United States
2019: Chief Executive Officer of Advantage Solutions,Albertsons
 a global business solutions services firm, since 2013 and has served on Advantage Solutions’ board of directors since 2008. Ms. Domier was 2018: President and Chief Operating Officer from 2010 of Albertsons
2013 to 20122015: Chief Executive Officer of Extended Stay America, Inc., one of the largest integrated hotel owner/operators in the United States.
Prior to 2013: Chief Executive Officer of Haggen, Inc.; Chief Executive Officer of Starbucks Corporation
James L. Donald
Independent DirectorSkills and President of Marketing Services Division and Integrated Marketing Services from 2000 to 2010. Before joining Advantage Solutions (formerly known as Advantage Sales & Marketing) in 1990, Ms. Domier held management positions withQualifications
Joined the J.M. Smucker Company. She has been a director of Yum! Brands, Inc. since January 2018.Board: 2020
Ms. Domier
Mr. Donald brings to the Board extensiveboard 45 years of experience in global salesleadership roles at consumer-facing businesses ranging from hospitality to retail. Mr. Donald has a wealth of knowledge and marketing focused onexpertise in navigating the customer, successful strategic planning expertisefast-paced and senior leadership skills. Further, Ms. Domier possesses financial and accounting skills, and knowledge of and experience with executive compensation programs.dynamic environment facing the Company today.
Age 67
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Kirsten A. Green
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Director since 2019Other Current Public BoardsNordstrom Board Committee Memberships
Age 47Albertsons Companies, Inc.AFC
TC
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Career Highlights
2010 to present: Founder and Managing Partner of Forerunner Ventures, a venture capital firm, since 2010. Prior to foundingfirm. In her role with Forerunner Ms. Green was an equity research analyst and investor at Banc of America Securities, formerly Montgomery Securities. Ms. Green began her career at Deloitte & Touche LLP where she earned her CPA license.Ventures, Ms. Green has served as a member ofon the boardboards of directors of numerous private companies since 2013.2013
Prior to 2010: Equity Research Analyst at Banc of America Securities; Senior Associate at Deloitte & Touche LLP
Kirsten A. Green
Independent DirectorSkills and Qualifications
Joined the Board: 2019
Ms. Green brings to the Board extensive experience in consumer and commerce focusedcommerce-focused businesses and provides unique insights with respect to the challenges and opportunities of today’s rapidly evolving digital commerce landscape. Ms. Green has deep domain expertise and an understanding of consumer behaviors, brand building and products.


NORDSTROM, INC. - 2019 Proxy Statement 21



Age 49
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Glenda G. McNeal
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Director since 2019Other Current Public BoardsNordstrom Board Committee Memberships
Age 58Hims, Inc.AFC
Northern Star Investment Corp. IITC
21 NORDSTROM, INC. - 2021 Proxy Statement

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Career Highlights
2017 to present: President Enterprise Strategic Partnerships of American Express
, since 2017. Prior to that role, from 2011 to March 2017, Ms. McNeal served as 2017: Executive Vice President and General Manager of the Global Client Group of American Express. Ms. McNeal has held Express
1989 to 2011:positions of increasing responsibility at American Express since 1989 when she first joined the company. Before joining American Express, Ms. McNeal worked with the accounting firm of
Prior to 1989: Arthur Andersen, LLP and withLLP; the investment banking firm of Salomon Brothers, Inc. Ms.
Glenda G. McNeal has been a director of RLJ Lodging Trust since 2011. Ms. McNeal served on
Independent DirectorSkills and Qualifications
Joined the board of directors of United States Steel Corporation from 2007 to 2018.Board: 2019
Ms. McNeal brings to the Board extensive experience in business development, innovation and customer relationship management, as well as financial, accounting and senior leadership skills. Ms. McNeal provides unique insights on strategic planning, risk oversight and operational matters. Ms. McNeal’s service on public company boards provides her with experience with corporate governance matters and key skills in working with directors, understanding board processes and functions, and assessing risk and overseeing management.
Age 60
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Erik B. Nordstrom
Director since 2006*
Age 55
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Other Current Public BoardsNordstrom Board Committee Memberships
RLJ Lodging TrustCPCC
CGNC
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Career Highlights
Co-President 2020 to present: Chief Executive Officer of Nordstrom, Inc.
2015 to 2020: Co-President since May 2015. Mr.of Nordstrom, served as Inc.
2014 to 2015: Executive Vice President and President, Nordstrom.com from May 2014 to May 2015. From February of Nordstrom, Inc.
2006 to May 2014, Mr. Nordstrom was 2014: Executive Vice President and President, Stores for the Company. From August of Nordstrom, Inc.
2000 to February 2006, he served as 2006: Executive Vice President, Full-Line Stores. Mr.Stores of Nordstrom, previously served as Inc.
2000: Executive Vice President and Northwest General Manager from February 2000 to August 2000, and as Co-President of the Company from Nordstrom, Inc.
1995 to February 2000. He has held2000: Co-President of Nordstrom, Inc.
1979 to 1995: various other management and sales positions of increasing responsibility since joining
Erik B. Nordstrom
DirectorSkills and Qualifications
Joined the Company in 1979.Board: 2006
Mr. Nordstrom’s positions of increasing responsibility with the Company over more than 3540 years, including executive roles related to digital and operational roles,store operations, give him a customer-centric perspective in retailing and supporting the business of the Company.
Age 57
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Peter E. Nordstrom
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Director since 2006*Other Current Public BoardsNordstrom Board Committee Memberships
Age 57NoneNone
Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James F. Nordstrom, Jr., President, Stores for the Company.
NORDSTROM, INC. - 2021 Proxy Statement 22

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Career Highlights
Co-President 2020 to present: President and Chief Brand Officer of Nordstrom, Inc.
2015 to 2020: Co-President since May 2015. Mr.of Nordstrom, served as Inc.
2006 to 2015: Executive Vice President and President, Merchandising for the Company from February 2006 to May 2015. From September of Nordstrom, Inc.
2000 to February 2006, he served as 2006: Executive Vice President, and President, Full-Line Stores. Mr.Stores of Nordstrom, previously served as Inc.
2000: Executive Vice President and Director of Full-Line Store Merchandise Strategy from February 2000 to September 2000, and as Co-President of the Company from Nordstrom, Inc.
1995 to February 2000. He has held2000: Co-President of Nordstrom, Inc.
1978 to 1995: various other management and sales positions of increasing responsibility since joining
Peter E. Nordstrom
DirectorSkills and Qualifications
Joined the Company in 1978.Board: 2006
Mr. Nordstrom’s positions of increasing responsibility with the Company over more than 3540 years, including executive roles relating to merchandising and operational roles,brand-building, give him a customer-centric perspective in retailing and supporting the business of the Company.
Age 59
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Brad D. Smith
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Director since 2013Other Current Public BoardsNordstrom Board Committee Memberships
Age 55NoneNone
Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James F. Nordstrom, Jr., President, Stores for the Company.
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Career Highlights
2016 to present: Executive Chairman and former Chief Executive Officer of Intuit, Inc., a global provider of business and financial management solutions since 2016 and
2008 to 2019: President and Chief Executive Officer from 2008 of Intuit, Inc.
2006 to 2019. Mr. Smith has served on Intuit’s board of directors since 2008. Mr. Smith joined Intuit in 2003 and served as 2007: Senior Vice President and General Manager, Small Business division from 2006of Intuit, Inc.
2005 to 2007, 2006: Senior Vice President and General Manager, QuickBooks from 2005 of Intuit, Inc.
2004 to 2006, 2005: Senior Vice President and General Manager, Consumer Tax Group from 2004 of Intuit, Inc.
2003 to 2005 and as 2004: Vice President and General Manager of Intuit’s Accountant Central and Developer Network from 2003 of Intuit, Inc.
Prior to 2004. Before joining Intuit, Mr. Smith was 2003: several executive positions, including Senior Vice President of Marketing and Business Development of at ADP, where he held several executive positions from 1996 to 2003. Mr.Inc.
Brad D. Smith has served on
Independent Director
Joined the board of directors of SurveyMonkey since 2017,Board: 2013
Skills and served on the board of directors of Yahoo! Inc. from 2010 until 2013.
Qualifications
Age 57Mr. Smith brings to the Board digital expertise, brand marketing, innovation and entrepreneurial experience, as well as financial and accounting skills, from his position at Intuit. He provides unique insights related to technology innovation and marketing of products and services to broad audiences throughout the world. Mr. Smith’s service on the boards of Yahoo!, SurveyMonkey,SVMK (SurveyMonkey) and Intuit, and his prior service on the Board of Yahoo!, provide him with experience in corporate governance matters and key skills in working with directors, understanding board processes and functions, assessing risk and overseeing management.
*Erik
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Other Current Public BoardsNordstrom and Peter Nordstrom are brothers, great grandsons of the Company’s founder and the second cousins of James F. Nordstrom, Jr., President, Stores for the Company.Board Committee Memberships
Intuit, Inc.CPCC
SVMK Inc.CGNC

2223 NORDSTROM, INC. - 20192021 Proxy Statement


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Gordon A. Smith
Director since 2015
Age 60
Career Highlights
Co-President and Chief Operating Officer of JP Morgan Chase & Co.,2021 to present: Chairman a global financial services firm since January 2018. Mr. Smith was Chief Executive Officer, Consumerof Alaska Air Group, Inc., an airline holding company comprised of Alaska Airlines, Inc., and Community Banking, JP Morgan Chase & Co. from 2007Horizon Air, Inc.
2014 to January 2018. He previously was President, Global Commercial Card Group for American Express Travel Related Services, Inc., from 2005 to 2007, President of Consumer Card Services Group for American Express Travel Related Services, Inc., from September 2001 to 2005 and Executive Vice President of U.S. Service Delivery from March 2000 to September 2001. Mr. Smith joined American Express in 1978 and held positions of increasing responsibility within the company. Mr. Smith served on the board of directors of Choice Hotels International from 2004 until 2017.2021:
Mr. Smith brings to the Board his extensive experience in customer-focused businesses in a highly competitive industry. He provides unique insights with respect to customer rewards programs in the consumer services industry. Further, Mr. Smith’s service on a public company board provides him with experience with corporate governance matters and key skills in working with directors, understanding board processes and functions, assessing risk and overseeing management.
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Bradley D. Tilden
Director since 2016
Age 58
Chairman and Chief Executive Officer of Alaska Air Group, Inc.,
 an airline holding company, since January 2014. In May 2012 Mr. Tilden was named to 2014: President and Chief Executive Officer of Alaska Air Group. He served as Group, Inc.
2002 to 2008: Executive Vice President of Finance and Planning from 2002 of Alaska Air Group, Inc.
2000 to 2008 and as2008: Chief Financial Officer from 2000 to 2008 for of Alaska Air Group, and priorInc.
Prior to 2000, was 2000: Vice President of Finance at Alaska Air Group. Before joining Alaska Airlines, Mr.Group, Inc.; PriceWaterhouseCoopers
Bradley D. Tilden worked for
Independent DirectorSkills and Qualifications
Joined the accounting firm PricewaterhouseCoopers. He serves on the board of Alaska Air Group.Board: 2016
Mr. Tilden brings to the Board executive, operational, strategic planning and financial experience, as well as insights with respect to customer rewards programs in the consumer services industry. Mr. Tilden’s service on a public company board service provides him with experience with corporate governance matters and key skills in working with directors, understanding board processes and functions, assessing risk and overseeing management.
Age 60
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B. Kevin Turner
Director since 2010
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Age 54Other Current Public BoardsNordstrom Board Committee Memberships
Alaska Air Group, Inc.AFC (Chair)
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Career Highlights
2019 to present: President and Chief Executive Officer of Core Scientific, Bed Bath & Beyond, an omnichannel retailer selling a wide assortment of domestic merchandise and home furnishings online and through several brand retail storefronts
a company focused on Blockchain and Artificial Intelligence infrastructure. Mr. Turner was previously Chief Executive Officer of Citadel Securities, a global market maker, and Vice Chairman of Citadel LLC, a global financial institution, from August 2016 to January 2017. He served as Chief Operating Officer of Microsoft Corporation from 2005 to 2016, and as Chief Executive Officer and President of Sam’s Club, a Wal-Mart subsidiary corporation from 2002 to 2005. Between 1985 and 2002, Mr. Turner held a number of positions of increasing responsibility with Wal-Mart Stores, Inc., including 2019: Executive Vice President and Global Chief InformationMerchandising Officer from 2001 to 2002. of Target Corporation
2009 to 2016: Executive Vice President and Division President of the Nordstrom Product Group of Nordstrom, Inc.
Mark J. Tritton
Independent DirectorSkills and Qualifications
Joined the Board: 2020
Mr. Turner’s experience at Core Scientific, Microsoft and Walmart have provided him extensiveTritton brings to the Board over 30 years of experience in highly competitiveretail and customer centric businesses.  He provides insightapparel businesses, providing him deep insights into consumer behavior, brand building and expertise in strategy, digital, global operations, supply chain, merchandising, branding, marketing and technology.  Further, Mr. Turner’s deep experience in both technology and retail uniquely positions himoperational matters which are key to advise the Company’s business.
Age 57
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Other Current Public BoardsNordstrom Board and senior management on the intersection of digital technology and retail.Committee Memberships
Bed Bath & Beyond Inc.CPCC
CGNC


NORDSTROM, INC. - 20192021 Proxy Statement 2324



AUDIT AND FINANCE COMMITTEE REPORT
The following Report of the Company’s Audit and Finance Committee of the Board (the “Audit and Finance Committee”) does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Company filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent the Company specifically incorporates this Report by reference.
The Audit and Finance CommitteeAFC operates under a written Chartercharter adopted by the Board. The Chartercharter contains a detailed description of the scope of the Audit and Finance Committee’sAFC’s responsibilities and how they will be carried out. The Audit and Finance Committee’s CharterAFC’s charter is available on our website at investor.nordstrom.com, and may be viewed by selecting the Corporate Governance item in the Investor Relations drop-down menu.Website.
The AFC Currently consists of five directors, each of whom has been determined by the Board to meet the heightened independence requirements under SEC and NYSE Listed Company Rules. In addition, the Board has determined that each member of the Audit and Finance CommitteeAFC is independent from the Company as such term is defined in Sections 303.01(B)(2)(a) and (3) of the NYSE’s listing standards at all times during the fiscal year and that each member was an “audit committee financial expert” within the meaning of Item 407 of Regulation S-K under the Securities Exchange Act of 1934.SEC rules.
The Audit and Finance CommitteeAFC serves in an oversight capacity and is not part of the Company’s managerial or operational decision-making process. As part of its responsibilities for oversight of the Company’s Enterprise Risk Management process, the Audit and Finance CommitteeAFC reviews and discusses Company policies and processes with respect to risk assessment and risk management, including discussions of individual risk areas. Management is responsible for the Company’s internal controls and the financial reporting process. Deloitte, the Company’s independent registered public accounting firm, reports to the Company’s Audit and Finance Committee,AFC, and is responsible for performing an integrated audit of the Company’s consolidated financial statements and internal control over financial reporting in accordance with auditing standards generally accepted in the United States of America.
Deloitte and the Company’s internal auditors have full access to the Audit and Finance Committee.AFC. The auditors meet with the Audit and Finance CommitteeAFC at each of the Audit and Finance Committee’sAFC’s regularly scheduled meetings, with and without management being present, to discuss appropriate matters. The Audit and Finance CommitteeAFC has the sole authority to engage, evaluate and terminate the Company’s independent auditors. The Audit and Finance CommitteeAFC also pre-approves all auditing services, internal control-related services and permitted nonaudit services to be performed by the Company’s independent auditors, and periodically reviews whether to request proposals for the engagement of the independent audit firm.
The Audit and Finance CommitteeAFC recommended to the Board that the audited consolidated financial statements for the fiscal year ended February 2, 2019January 30, 2021 be included in the Company’s 2020 Annual Report on Form 10-K for such fiscal year, based on the following actions by the Committee:
review of the Company’s audited consolidated financial statements with management;
review of the unaudited interim financial statements and Forms 10-Q prepared each quarter by the Company;
review of the Company’s Disclosure Committee practices and the certifications prepared each quarter in accordance with Sections 302 and 906 of the Sarbanes-Oxley Act of 2002;
review with management regardingof the critical accounting estimates on which the financial statements are based, as well as its evaluation of alternative accounting treatments;
receipt of management representations that the Company’s financial statements were prepared in accordance with accounting principles generally accepted in the United States of America;GAAP;
review, with management, the internal auditors and Deloitte, regardingof management’s assessment of the effectiveness of the Company’s internal control over financial reporting and Deloitte’s evaluation of the Company’s internal control over financial reporting;
review, with legal counsel and management, regardingof contingent liabilities;
receipt of the written disclosures and letter from Deloitte required by the Public Company Accounting Oversight Board Ethics and Independence Rule 3526, Communication with Audit and Finance CommitteesAFCs Concerning Independence; and
review, with Deloitte, regarding theirof Deloitte’s independence, the audited consolidated financial statements, the matters required to be discussed by Auditing Standard No. 16 Communications with Audit and Finance CommitteesAFCs, as amended, and other matters, including Rule 2-07 of SEC Regulation S-X.
Audit and Finance Committee
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Bradley D. Tilden, Chair
Stacy Brown-Philpot
Tanya L. Domier
James L. DonaldKirsten A. Green
Philip G. Satre

2425 NORDSTROM, INC. - 20192021 Proxy Statement


PROPOSAL 2RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board recommends a vote FOR this proposal.
The Audit and Finance Committee,AFC, consistent with NYSE and SEC rules, has appointed Deloitte to be the Company’s independent registered public accounting firm for the fiscal year ending February 1, 2020.January 29, 2022. Deloitte and its predecessors have served as the Company’s independent registered public accounting firm for over 4550 years, including the fiscal year ended February 2, 2019.January 30, 2021.
As a matter of good corporate practice to provide shareholders an avenue to express their views on this matter, the Board has determined to seek shareholder ratification of Deloitte’s appointment at this time. If the shareholders do not ratify the appointment of Deloitte, the Board will reconsider the appointment. A representative of Deloitte will be present atattend the Annual Meeting to respond to questions and to make a statement if he or she so desires.desired.
Audit Fees
The following table summarizes fees billed or expected to be billed to the Company by Deloitte in connection with services for the fiscal years ended February 2, 2019January 30, 2021 and February 3, 2018:1, 2020:
 Fiscal Year Ended
February 2, 2019
 Fiscal Year Ended
February 3, 2018
Fiscal Year Ended
January 30, 2021
Fiscal Year Ended
February 1, 2020
Type of Fee ($)
 (%)
 ($)
 (%)
Type of Fee($)(%)($)(%)
Audit Fees(a)
 3,657,000
 83
 2,924,000
 55
Audit Fees(a)
3,332,000 86 3,281,000 87 
Audit-Related Fees(b)
 581,000
 13
 683,000
 13
Audit-Related Fees(b)
467,000 12 426,000 11 
Other Fees(c)
 152,000
 4
 1,680,000
 32
Other Fees(c)
68,000 68,000 
TOTAL 4,390,000
 100
 5,287,000
 100
TOTAL3,867,000 100 3,775,000 100 
(a) Audit Fees
Audit Fees primarily relate to fees for services for: (i) auditing the consolidated financial statements of the Company; (ii) reviewing the interim financial information of the Company included in its Form 10-Qs; and (iii) auditing the Company’s internal control over financial reporting. Substantially all of Deloitte’s work on these audits was performed by full-time, regular employees and partners of Deloitte and its affiliates.
(b) Audit-Related Fees
Audit-Related Fees are fees for assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements and internal control over financial reporting.
reporting, services related to the issuance of the Company’s securities and accounting research tool subscription fees. This amount does not reflect reimbursementadditional amounts of $274,000$364,000 for fiscal year ended January 30, 2021 and $312,000 for fiscal year ended February 2, 20191, 2020 which were reimbursed to the Company by its banking partner in connection with the System and $254,000 for fiscal year ended February 3, 2018. This amount includes accounting research tool subscription fees of $6,000 for fiscal year ended February 2, 2019 and $6,000 for fiscal year ended February 3, 2018.Organization Controls report related to the Company’s credit card servicing activities.
(c) Other Fees
Other Fees for the fiscal yearsyear ended February 2, 2019January 30, 2021 and February 3, 2018 primarily 1, 2020 related to fees for advice and recommendations on supply chain strategy.human resources benchmarking services.
Pre-Approval Policy
Consistent with SEC policies regarding auditor independence, the services performed by Deloitte for the fiscal years ended February 2, 2019January 30, 2021 and February 3, 20181, 2020 were pre-approved in accordance with the policies and procedures adopted by the Audit and Finance Committee.AFC. The pre-approval policy is periodically reviewed and updated. It describes the permitted audit, audit-related, tax and other services that Deloitte may perform.
Normally, pre-approval is provided at regularly scheduled Audit and Finance CommitteeAFC meetings. However, the authority to grant specific pre-approval between meetings, as necessary, has been assigned to the Chair of the Audit and Finance Committee.


NORDSTROM, INC. - 2019 Proxy Statement 25



AFC. The Chair is responsible for updating the Audit and Finance CommitteeAFC at the next regularly scheduled meeting of any services that were pre-approved between meetings.
The Audit and Finance CommitteeAFC approves proposed services, which incorporates appropriate oversight and control of the Deloitte relationship, while permitting the Company to receive immediate assistance from Deloitte when time is of the essence.
The Committee also reviews on a regular basis:
a listing of approved services since its last review;
a report summarizing the year-to-date services provided by Deloitte, including fees paid for those services; and
a projection for the current fiscal year of estimated fees.
The policy prohibits the Company from engaging the independent registered public accountants for services billed on a contingent fee basis and from hiring current or former employees of the independent auditor who have not satisfied the statutory cooling-off period for certain positions.

26 NORDSTROM, INC. - 20192021 Proxy Statement 26


EXECUTIVE OFFICERS
The Executive Officers of the Company are appointed annually by the Board following each year’s annual meeting and serve at the discretion of the Board. In addition to Erik Nordstrom and Peter Nordstrom, whose biographical information is provided under Election of Directors on page pages 22 and 23, the following are the other Executive Officers of the Company on the date of filing of this Proxy Statement.
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Teri J. Bariquit
Employee since 1986
Age 55
Chief Merchandising Officer, since August 2019. From 2004 to 2019, Ms. Bariquit served as Vice President and then Executive Vice President, Nordstrom Merchandising Group, where she was responsible for Inventory, Planning, Solutions and Business Integration. In her prior role, she led inventory planning, merchandising strategy, brand programs and business transformation initiatives for both Nordstrom and Nordstrom Rack. Prior to 2004, she held various management roles in Merchandising, including Business Integration Director, Business Information & Technology Director and Inventory Audit Manager.
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Anne L. Bramman
Employee since 2017
Age 5153
Chief Financial Officer, since June 2017, when she joined the Company. From March 2015 to March 2017, Ms. Bramman served as Senior Vice President and Chief Financial Officer of Avery Dennison Corporation. She previously served as Chief Financial Officer of Carnival Cruise Line from December 2010 to March 2015. She was employed by L Brands in various finance leadership positions from July 2004 to December 2010, including Senior Vice President, Chief Financial Officer of Henri Bendel from 2008 to 2010.
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Alexis DePree
Employee since 2020
Age 42
Chief Supply Chain Officer, since January 2020, when she joined the Company. Ms. DePree previously served as Vice President of Americas sort centers & planning at Amazon.com, Inc. from 2018 to 2020, and as Amazon’s Vice President of global supply chain operations from 2016 to 2018. From 2007 to 2016, she held executive positions with increasing responsibility at Target Corporation, prior to which she was employed at Dell Technologies Inc. in various leadership positions from 2001 to 2005.
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Christine F. Deputy
Employee since 2015
Age 5355
Chief Human Resources Officer, since June 2015, when she joined the Company. Ms. Deputy previously served as Group Human Resources Director at Aviva plc from March 2013 to June 2015. From February 2012 to March 2013, she was Human Resources Director — Global Retail Banking for Barclays Bank. From July 2009 to February 2012, she was Chief Human Resource Officer at Dunkin’ Brands. She was employed at Starbucks Corporation from March 1998 to June 2009, serving as Vice President, Human Resources Asia Pacific from November 2007 to June 2009, Vice President, Global Staffing from September 2005 to January 2008, as well as other executive positions from 1998 to 2005.
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Kelley K. HallMichael W. Maher
Employee since 20172009
Age 4647
Senior Vice President, Chief Accounting Officer, since January 2020. Mr. Maher previously served as Senior Vice President, Finance since May 2017. From October 2011 to April 2017, he held various leadership finance roles for the Company’s Full-Line stores and Treasurer since August 2017,Full-Price business. He previously served as the Company’s Controller from November 2009, when Ms. Hallhe joined the Company. From October 2008Company, until September 2011. Prior to August 2017, she held various senior finance leadership positions at NIKE, Inc. most recentlyjoining Nordstrom, Mr. Maher served as the Vice President, Retail Division Controller for Longs Drug Stores Corporation, the Assistant Corporate Controller at 24 Hour Fitness, and Chief Financial Officer for NIKE, Inc.’s Enterprise Operations. Prior to NIKE, she spent 14 yearsas a Manager of Assurance and Advisory Services and a Certified Public Accountant with Starbucks Corporation in a variety of finance leadership roles, including several roles as vice president supporting U.S. retail and corporate finance.Deloitte & Touche LLP.
27 NORDSTROM, INC. - 2021 Proxy Statement

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Scott A. Meden
Employee since 1985
Age 5658
Chief Marketing Officer, since August 2016. From February 2010 to August 2016, Mr. Meden served as Executive Vice President and General Merchandise Manager, Shoe Division. He previously served as Executive Vice President and President, Nordstrom Rack from February 2006 to February 2010, as Divisional Merchandise Manager from September 2002 to January 2006, as Director of Business Planning and Analysis from 2001 to September 2002, and as Financial Manager, Shoes from 1999 to 2001.
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Edmond Mesrobian
Employee since 2018
Age 5860
Chief Technology Officer, since August 2018, when he joined the Company. Previously he was Chief Technology Officer for multi-national grocery retailer Tesco PLC from 2015 to July 2018. From 2011 to 2014, he served as Chief Technology Officer for global travel company Expedia Group, Inc., which includes online travel brands Expedia.com, Hotels.com and Hotwire.com. Prior to joining Expedia, he held the role of Chief Technology Officer at RealNetworks, Inc. from 2003 to 2010, where he led development across multiple digital media services and software.
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James F. Nordstrom, Jr.
Employee since 1986
Age 4648
President, Stores, since May 2014. From 2005 to 2014, Mr. Nordstrom served as Executive Vice President and President, Nordstrom.com. He previously served as Corporate Merchandise Manager, Children’s Shoes, from May 2002 to February 2005, and as a project manager for the design and implementation of the Company’s inventory management system from 1999 to May 2002. Mr. Nordstrom is a great-grandson of the Company’s founder.


NORDSTROM, INC. - 2019 Proxy Statement 27



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Robert B. SariAnn Munson Steines
Employee since 20092019
Age 6355
General Counsel and Corporate Secretary, since April 2009,July 2019, when heshe joined the Company. Mr. Sari previously served as Executive Vice President, General Counsel, and Secretary of Rite Aid Corporation since October 2005. Mr. Sari also served as Rite Aid’s Senior Vice President, General Counsel and Secretary from 2002 to 2005 and as aPreviously, she was Senior Vice President, Deputy General Counsel and Assistant Secretary from 2000for Macy’s, Inc. for approximately ten years. Ms. Steines joined Macy’s, Inc. in 1998 as Assistant Counsel, Employment Law, and rose through positions of increasing responsibility until her appointment as Deputy General Counsel and Assistant Secretary. Prior to 2002. He servedMacy’s, Ms. Steines was a Senior Attorney with the Overnite Transportation Company, a subsidiary of Union Pacific Corporation. Ms. Steines began her legal career with Dinsmore & Shohl in other roles for Rite Aid beginningCincinnati, Ohio in 1997.1990 and then practiced law with the law firm of Michael Best & Friedrich in Milwaukee, Wisconsin.
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Geevy S.K. Thomas
Employee since 1983
Age 5456
President, Nordstrom Rack, since January 2018. Mr. Thomas previously served as Chief Innovation Officer sincefrom January 2017.2017 to January 2018. From 2010 to 2017, he served as Executive Vice President and President, Nordstrom Rack. He previously served as Executive Vice President and South Regional Manager from November 2001 to February 2010, as Executive Vice President and General Merchandise Manager, Full-Line Stores from February 2001 to November 2001, and as Executive Vice President, Full-Line Stores and Director of Merchandising Strategy from February 20001999 to February 2001. Prior to February 2000,1999, he held various merchandise strategy, store and regional management positions with the Company.
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Kenneth J. Worzel
Employee since 2010
Age 5456
Chief Operating Officer, since August 2019. From 2018 to August 2019, Mr. Worzel served as Chief Digital Officer, since May 2018 andfrom 2016 to 2019 as President of Nordstrom.com, since 2016. Fromand from 2010 to 2016, Mr. Worzelhe served as Executive Vice President, Strategy and Development. Prior to joining the Company, he was a partner with McKinsey & Company, a global management consulting firm, from 2009 to 2010. While at McKinsey, he provided the Company and other clients with management strategy and organizational services. Prior to joining McKinsey, he was a managing partner at Marakon Associates, an international strategy consulting firm, from 1992 to 2008. As a partner at Marakon Associates, he provided consulting services to the Company from 1997 to 2008.

28 NORDSTROM, INC. - 20192021 Proxy Statement 28


COMPENSATION OF EXECUTIVE OFFICERS
Compensation Discussion and Analysis
This section describes our executive compensation program and the compensation decisions made for our fiscal year 2018 Named Executive Officers. Our Named Executive Officers include Blake Nordstrom, our former Co-President, who passed away unexpectedly on January 2, 2019.
2020 NEOs.
Erik B. NordstromCo-PresidentChief Executive Officer
Anne L. Bramman Chief Financial Officer
Peter E. Nordstrom Co-PresidentPresident and Chief Brand Officer
Kenneth J. Worzel Chief Digital Officer and President, Nordstrom.com
Christine F. DeputyChief Human ResourcesOperating Officer
Blake W. NordstromEdmond MesrobianFormer Co-PresidentChief Technology Officer
For purposes of our filings with the SEC, including this annual Proxy Statement, Erik Nordstrom is considered our Principal Executive Officer and Anne Bramman is considered our Principal Financial Officer.
20182020 Snapshot
Increased Customer Engagement Driving Continued Growth Financial Flexibility and Accelerated Strategic Initiatives During 2020
Looking back at 2020, we took aggressive actions as we navigated through the pandemic to increase our financial flexibility and accelerate our strategic initiatives to better serve customers. As shifts in customer expectations and behavior accelerated, our multi-year investments and strong financial position enabled our transformation into a digital-first business.
During the year, we took the following actions to ensure we can successfully emerge from this pandemic in a stronger position:
In fiscal year 2018, net earnings were $564Expense discipline – rebased our cost structure, reflecting more than $300 million or $3.32 per diluted share, which included a $0.05 favorable income tax benefit relatedin permanent overhead reductions and contributing to prior periodsmore than $425 million in operating cash flow generation over the past three quarters
Market strategy – scaled to top 10 markets, making up more than 50% of sales, providing customers with four times more merchandise selection on average and an estimated non-recurring credit-related chargefaster delivery
Rack – integrated store and online inventory to increase online selection and enable order pickup and store fulfillment capabilities
Going forward, our brand promise of $0.28 (see page 42getting “closer to you” is the guiding principle of our growth plans. We are committed to significantly expanding the breadth of who we serve, and where and how we serve them. We are doing this by unlocking the full power of the Company’s Annual Reportdigital-first platform we have built to
capture market share gains, drive profitable growth, and create significant value for our shareholders. We are dedicated to executing on Form 10-K for the fiscal year ended February 2, 2019)our strategy across our three areas of highest priority:
Winning in our most important markets. We achieved net salesare continuing to scale our market strategy by doubling our exposure from 10 to 20 markets, making up 75% of $15.5 billion. This compares to $15.1 billion in 2017, which included $220 million forour business.
Broadening the 53rd week associated with the 4-5-4 retail calendar. We maintained a strong financial position, generating annual operating cash flowreach of more than $1 billion for the 10th consecutive year and returning nearly $1 billion to shareholders through dividends and share repurchases during the year.
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Achieved $15.5B in sales, reflecting scaling of our generational investments.Grew comparable sales 1.7%, reflecting Full-Price increase of 0.9% and Off-Price increase of 3.5%.Generated earnings of $564M, reflecting lower income tax expense associated with corporate tax reform.


NORDSTROM, INC.Nordstrom Rack - 2019 Proxy Statement 29



Our business model is a key point of difference in serving customers in multiple ways — through stores, online, Full-Price and Off-Price — with meaningful synergies across Nordstrom.. We are focused on leveraginggrowing our share of the price-oriented customer segment, which we see as a $2 billion incremental sales opportunity over time.
Increasing the velocity of our digital business. We are focused on more effectively translating the heritage of service that defines us in this digitally connected world. This means delivering personalization at scale by creating greater linkages between digital and physical assetsexperiences.
We are grateful for our team’s efforts to providestrengthen our financial flexibility and accelerate our strategic priorities to serve customers within new and differentiated ways. These actions have put us in a best-in-class experience. In 2018, we achieved the following milestones in executingstrong position to capitalize on our customer strategy through our three strategic pillars: providing a compelling product offering, delivering outstanding services and experiences, and leveraging the strength of the Nordstrom brand:
We continued to see positive customer trends. In 2018, over 35 million customers shopped with us, an increase of 6% from last year. One-third of our customers shopped across our multiple channels, which generally leads to higher customer spend.
Digital sales increased 16% and made up 30% of net sales. Additionally, Nordstrom.com achieved scale, with the profitability of Full-Price digital sales at parity with store sales. We believe our early investments to build a robust digital business have given us a competitive advantage.
Our generational investments continued to scale, contributing approximately $2 billion in sales and an improvement in profitability. Nordstromrack.com/HauteLook became our fastest business to reach $1 billion in sales. Trunk Club delivered sales growth of 35%. We opened our Men’s Store in New York City and furthered our expansion into Canada with the introduction of six Nordstrom Rack stores.
We launched our local market strategy in Los Angeles, which drove outsized market share gains in this market by increasing product selection, delivery speedopportunity as customer demand recovers. Heading into 2021 and convenience for customers.
As we aspire to be the best fashion retailer in a digital world, we believebeyond, we are well positionedconfident in our ability to deliver a differentiated customer experience and drive increased shareholder value.profitable sales growth.
Shareholders Support our Compensation Program
Our shareholders approved our Board’s recommendation to hold executive compensation advisory votes on an annual basis so that they may frequently and openly express their views about the compensation of our Named Executive Officers.NEOs. Each year since 2011, more than 90% of the votes cast have been supportive of our compensation programs. Based on the majority of shareholders voting in favor of our executive compensation program last year, we continued to implement similar
compensation policies and programs in fiscal year 2018, 2020, with the exception of a changetemporary actions taken by the CPCC in order to preserve cash and sustain the mix ofcompany through COVID-19 related business impacts. These actions included temporary salary reductions and suspending the form of equity-based incentive awardsdiscretionary 401(k) match for fiscal year 2018, only, 2020,as discussed on page 37,pages 34 and 38, respectively. Aside from these temporary actions, we continued to apply the following pay and benefits philosophy.
29 NORDSTROM, INC. - 2021 Proxy Statement

Our Pay and Benefits Philosophy:
We believe that if our customers win, our employees and shareholders win – our interests are aligned.
We pay for performance by investing in talent that delivers results and demonstrates the behaviors that drive our success, while not encouraging excessive risk taking.
We deliver competitive pay and benefits for all jobs and differentiate pay for critical jobs that directly impact our ability to deliver on our strategy.
We use objective market data to design flexible pay and benefits programs to help attract, retain, motivate and reward our employees and meet the needs of specific talent groups.
We provide equal pay and promotion opportunities for all employees and give them the information they need to clearly understand their pay and effectively manage their careers.
We Emphasize Variable Pay and Balance Short- and Long-Term Incentives as Well as Incentive Values
In accordance with our pay-for-performance philosophy, the compensation program for our Named Executive OfficersNEOs is straightforward in design and includes four primary elements: base salary, performance-based bonus, long-term incentives (“LTI”)LTIs and benefits. Within these pay elements, we emphasize variable pay over fixed pay, with at leastapproximately 70% of each Named Executive Officer’sNEO’s target compensation linked to our financial or market results. The program also balances the importance of these executives achieving both critical
short-term objectives and strategic long-term priorities. The following graphics represent target compensation for the Co-PresidentsCEO and the President and Chief Brand Officer and for the other Named Executive Officers.NEOs. They do not reflect temporary salary reductions implemented in fiscal year 2020 as discussed on page 34, or the one-time equity grant made on August 27, 2020 as discussed on page 36.

Chief Executive Officer and
President & Chief Brand Officer
All Other Named Executive
Officers Combined
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85%75%
Performance BasedPerformance Based
30 NORDSTROM, INC. - 2019 Proxy Statement  


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Our Variable Pay Reflects Company Performance
Our pay-for-performance design includes rigorous performance goals and high performance standards. Further, with a substantial portion of pay in the form of Nordstrom stock,Common Stock, pay outcomes align with our shareholders’ experience.interests. This is
evidenced by our Named Executive Officers’NEOs’ recent incentive compensation payouts and grant realizable values as of our 20182020 fiscal year end, as shown below.in the tables on the following page.
NORDSTROM, INC. - 2021 Proxy Statement 30

INCENTIVE COMPENSATION PAYOUTS 2014
 2015
 2016
 2017
 2018
Incentive Earnings Before Interest and Income Tax Expense (“Incentive EBIT”) 
$1,391M 
$1,246M 
$1,076M 
$952M 
$909M
Incentive Adjusted Return on Invested Capital
(“Incentive Adjusted ROIC”)
 13.6% 11.0% 12.4% 10.0% 12.8%
Annual bonus
(payout as a % of Target*)
 83% 0% 80% 96% 89%
3-year TSR percentile ranking within comparator group 63%ile
 53%ile
 16%ile
 10%ile
 24%ile
Performance Share Unit (“PSU”) vesting
(payout as a % of Target)
 75% 75% 0% 0% 0%
PSU comparator group Retail
 Retail
 S&P 500
 S&P 500
 S&P 500
20162017201820192020
FINANCIAL RESULTS
Net Earnings (Loss)$354 M$437 M$564 M$496 M($690 M)
EBIT$805 M$926 M$837 M$784 M($1,047 M)
Return on Assets4.5 %5.4 %6.8 %5.1 %(7.1 %)
INCENTIVE COMPENSATION PAYOUTS
Incentive Adjusted EBIT$1,076 M$952 M$909 M$808 M($1,047 M)
Incentive Adjusted ROIC12.4 %10.0 %12.8 %11.2 %(8.5 %)
Annual bonus (payout as a % of Target on Incentive Adjusted EBIT measure*)80 %96 %89 %44 %0 %
3-year TSR percentile ranking within the S&P 500**16%ile10%ile24%ile20%ileN/A
PSU vesting (payout as a % of Target)0 %0 %0 %0 %N/A***
*
Actual bonus payout for fiscal year 2017 as a % of Target for the Co-Presidents was 94%. Actual bonus payout for fiscal year 2018 as a % of Target for the Co-Presidents was 63%. See pages 35 and 36 for more information.
*For the CEO and the President and Chief Brand Officer, actual bonus payouts as a percent of target for fiscal years 2017, 2018 and 2019 were 94%, 63% and 47%, respectively. See pages 35 and 36 for more information.
** 2019 PSU grant results are based on internal measures. PSU vesting reflects the performance period ended February 1, 2020.
*** No PSU performance cycles ended in fiscal year 2020.
Incentive Adjusted EBIT and Incentive Adjusted ROIC are not measures of financial performance under Generally Accepted Accounting Principles (“GAAP”)GAAP and should be considered in addition to, and not a substitute for, return on assets, net earnings, total assets or other GAAP financial measures prepared in accordance with GAAP.measures. See Appendix A for a reconciliation of GAAP and non-GAAP financial measures.
PSU vesting as shown in the table above corresponds to the performance periods ending in fiscal years 20142016 through 2018.2020. Three-year Total Shareholder Return (“TSR”) percentileTSR percentile ranking is based on our relative TSR performanceperformance over three-year rolling periods between fiscal years 20122014 and 20182019 versus the comparator group. BeginningS&P 500, with the 2014 – 2016 performance period,exception of the 2019 PSU grant. For the 2019 PSU grant, we changed our comparator groupperformance measure from our retail peer grouprelative TSR to internal measures, structured with two performance periods. Given the change in measures from relative TSR to internal measures related to the Standardstrategy that was communicated to our
shareholders in July 2018, the CPCC decided to split the 2019 PSU grant into two tranches: two-thirds of which has a three-year performance period and Poor’s 500. Seeone-third of which has a one-year performance period. The one-year performance period was intended only for the 2019 PSU grant. One-third of the PSUs were to be earned on the last day of the one-year performance cycle, February 1, 2020, if performance criteria had been met, and two-thirds of the PSUs will be earned on the last day of the three-year performance cycle, January 29, 2022, if performance criteria are met. Both tranches of the 2019 PSUs vest when the results have been certified by the CPCC at the end of the three-year performance cycle, January 29, 2022. For the one-year performance cycle ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant has time remaining in its three-year performance cycle, as described on page 37 to learn more about long-term incentive pay. 37.
GRANT REALIZABLE VALUES20162017201820192020
PSUs (realizable value as a % of grant value)%%N/A%N/A
RSUs (realizable value as a % of grant value)97 %92 %70 %91 %153 %
Stock options (realizable value as a % of grant value)%%N/A%280 %
GRANT REALIZABLE VALUES 2014
 2015
 2016
 2017
 2018
PSUs (realizable value as a % of grant value) 0% 0% 0% 51% N/A
RSUs (realizable value as a % of grant value) 94% 75% 111% 111% 94%
Stock options (realizable value as a % of grant value) 38% 0% 6% 6% N/A
Realizable values shown above are based on the actual value at time of vest, current unvested values using our 20182020 fiscal year end stock price of $45.33$35.45 and current performance for the outstanding PSUs granted in 20172019 (which were tracking at 50%0% payout as of the end of the fiscal year), shown as a percent of grant value. PSUs, restricted stock units (“RSUs”)RSUs and stock options are shown in the column matching the year of grant.
The PSUs granted on March 9, 2020 are not reflected in the table above. Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair
The Compensation Committee reviews these results and other analyses with the goal of ensuring that the Named Executive Officers’ aggregate compensation aligns with shareholder interests. Based on these and other outcomes, the Compensation Committee believes that total direct compensation for our Named Executive Officers reflects our pay-for-performance objective and is well aligned with shareholder interests.
values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022. For reference, the average closing stock price during fiscal year 2020 was $21.16.


31 NORDSTROM, INC. - 20192021 Proxy Statement31



The CPCC reviews these results and other analyses with the goal of ensuring that the NEOs’ aggregate compensation aligns with shareholder interests. Based on these and other
outcomes, the CPCC believes that total direct compensation for our NEOs reflects our pay-for-performance philosophy and is well aligned with shareholder interests.
Effective Corporate Governance Reinforces Our Compensation Program
Our compensation philosophy for our executive team, including our Named Executive Officers,NEOs, is reflected in governance practices that support the needs of our business, drive performance and align with our shareholders’ long-term interests. Below is a summary of what we do and don’t do in that regard.
WHAT WE DOWHAT WE DON’T DO
þü
Pay for performance: Our compensation program for Named Executive OfficersNEOs emphasizes variable pay over fixed pay, with at leastapproximately 70% of each Named Executive Officer’sNEO’s target compensation linked to our financial or market results.
Ø
image_010.jpg
Provide employment agreements.
þü
Retain meaningful stock ownership guidelines: Our expectations for ownership align executives’ interests with those of our shareholders, and all Named Executive OfficersNEOs have exceeded their targets.
Ø
image_010.jpg
Offer separation benefits to Named Executive OfficersNEOs who are Nordstrom family members.
þü
Mitigate undue risk: We have caps on potential performance-based bonus payments, a clawback policy on performance-based compensation and active and engaged oversight and risk management systems, including those related to compensation-related risk.
Ø
image_010.jpg
Offer special perquisites to our Named Executive Officers.NEOs.
Ø
image_010.jpg
Maintain separate change in control agreements.
þü
Engage an independent compensation consulting firm: The Compensation Committee’sCPCC’s consultant does not provide any other services to the Company.
Ø
image_010.jpg
Gross up taxes, except in the case of selected relocation expenses.
þü
Apply conservative post-employment and change in control provisions: Executive Officers are subject to provisions in the same manner as those for our broader employee population.
provisions.
Ø
image_010.jpg
Reprice underwater stock options.
þü
Limit accelerated vesting: Our equity plan provides for accelerated vesting of equity awards after a change in control only if an executive is involuntarily terminated by the Company or resigns for good reason, a provision referred to as a “double trigger.”
Ø
image_010.jpg
Issue grants below 100% fair market value.
Ø
image_010.jpg
Pay dividends on any unearned or unvested equity awards.
þü
Restrict pledging activity: All Executive Officers are subject to pre-clearance requirements and restrictions.
Ø
image_010.jpg
Permit hedging or short-sale transactions.
þü
Receive strong shareholder support: Each year since 2011, more than 90% of the votes cast on the matter have been in favorsupportive of our compensation programs.
Ø
image_010.jpg
Count pledged shares towardstoward stock ownership targets.
Context for Understanding Our Compensation Program and Decisions
This section provides background on the roles involved in determining compensation for our Named Executive Officers,NEOs, our use of market data and the companies selected for our peer group.
Our Roles in Determining Compensation are Well DefinedAre Well-Defined
Compensation, People and Culture Committee
Our Compensation Committee (“Committee”)CPCC oversees the development and delivery of our pay and benefits philosophy and compensation plans for the Named Executive OfficersNEOs and other executives as described in the Committee CharterCPCC charter on our website at investor.nordstrom.com.Investor Relations Website.
As part of that oversight, the CommitteeCPCC ensures the Named Executive Officers’NEOs’ aggregate compensation aligns with shareholder interests by reviewing analyses that include:
Cash alignment to evaluate the short-term incentive payouts relative to our financial performance.
Relative pay and performance to compare the percentile rankings of our total direct compensation (base salary + performance-based bonus + long-term incentives)LTIs) with financial performance metrics of our peer group.

32 NORDSTROM, INC. - 2019 Proxy Statement  


Compensation CommitteeCPCC Consultant
The Committee’s independent executive compensation consulting firm,CPCC has retained Semler Brossy Consulting Group, LLC (“Semler Brossy”), is retained by, and reports directly to, the Committee.Brossy. A consultant from thatthe firm attends the CommitteeCPCC meetings in person or by phone, and in support of the Committee’sCPCC’s role, provides independent expertise on market practices, compensation program design and related subjects as described on page 15.13. Semler Brossy provides services only as directed by the Committee.CPCC. During fiscal year 2018,2020, Semler Brossy’s services included a review of executive and director pay programs, performance goal-setting, alignmenta review of the compensation peer group, a review of pay and performance, and other pay-related matters specific to the Committee’s Charter.CPCC’s charter.
NORDSTROM, INC. - 2021 Proxy Statement 32

Management
Our Co-PresidentsCEO and the President and Chief Brand Officer provide input to the CommitteeCPCC on the level and design of compensation elements for the Named Executive OfficersNEOs and other Executive Officers, excluding themselves. Our Chief Human Resources Officer joins the Co-President(s)them in CommitteeCPCC meetings to provide perspective and expertise relevant to the agenda. Management supports the Committee’sCPCC’s activity by providing analyses and recommendations developed internally, or occasionally, with the assistance of external consulting firms other than the Committee’s consulting firm.CPCC’s independent consultant.
Market Data Provides a Reference Point for Compensation
The CommitteeCPCC believes that knowledge of market practices, particularly those of our peers listed below, is helpful in assessing the design and targeted level of our executive compensation package. In reviewing peer group information, the CommitteeCPCC uses survey data provided by external consultants, monitors general market movement for executive pay and references proxy statements for specific roles.
WhenWhile the Committee reviews market data, they considerCPCC considers the 50th50th percentile (median) of our peer group as a reference, point, rather than a policy, for positioningthere is no specific percentage of target total direct compensation.compensation targeted by the CPCC other than to remain generally competitive with similarly situated peer companies. Target opportunities for individual pay elements vary by executive role based on scope of responsibilities and expected contributions.
Erik Nordstrom, Peter Nordstrom and Blake Nordstrom’s targetTarget total direct compensation for 20182020 for Erik Nordstrom and Peter Nordstrom was below our peer group median, as it has been in previous years. Based on the Committee’sCPCC’s review of relevant market data and internal pay equity, the CommitteeCPCC believes the target total direct compensation for Anne
Bramman, Kenneth Worzel and Christine DeputyEdmond Mesrobian was within a competitive range of the peer group median. Actual pay for the Named Executive OfficersNEOs can exceed our established targets or peer group actual pay through the variable compensation elements when pre-determined performance milestones are achieved. Due to challenging business circumstances, actualActual or realizable pay for the past few years has been below target, as shown on page 31.
Peer Group Companies Represent Our Business
Each year, the CommitteeCPCC reviews the appropriateness of our peer group for comparison on pay and related practices. WhileCollectively, the peer group companies represent prominent brandsour primary business areas, including our Nordstrom, Nordstrom Rack, in-store, and specialty retailers that are relevant to Nordstrom, they may not always have a direct match to our product offerings or annual revenue. However, theonline business and private label products. The peer group companies generally meet the following selection criteria:
fall within the Consumer Discretionary and Staples sectors;
collective representationfall within a reasonable range of our primarysize, defined as one-fourth to four times our revenue and one-fifth to five times our market capitalization;
share similar talent, operational and/or business areascharacteristics, including a retail-focused business model;
including our Full-Price, Off-Price, in store,have a similar or related product focus and online business and private label products;place a high value on customer experience;
some overlap withare part of our industry group as defined by institutional shareholders and shareholder service organizations;
general compatibility with our compensation strategy through a competitive offering of the primary pay elements of base salary, performance-based bonus and long-term incentives; and
are a public company subject to similar market pressures with a track record of sustainability.pressures.
Our peer group used for evaluating compensation for fiscal year 20182020 was comprised of the following retail companies:
Bed Bath & Beyond, Inc.J. C. Penney Company, Inc.Tapestry, Inc.
Capri Holdings Limited*LimitedKohl’s CorporationTiffany & Co.
Dillard’s, Inc.L Brands, Inc.The TJX Companies, Inc.
The Estée Lauder Companies Inc.Macy’s, Inc.Urban Outfitters, Inc.
Foot Locker, Inc.Neiman Marcus Group LTD LLCRalph Lauren CorporationVF Corporation
Gap, Inc.Ralph Lauren CorporationRoss Stores, Inc.Williams-Sonoma, Inc.
Hudson’s Bay CompanyRoss Stores, Inc.
* Formerly known as Michael Kors Holding Limited.
During 2018,2020, as part of its annual review of peer companies to be used for compensation comparison purposes, the CommitteeCPCC determined that no changesHudson’s Bay Company and Neiman Marcus Group should be removed due to the peer group would be made for fiscal year 2019.

unavailability of publicly disclosed pay data going forward.

33 NORDSTROM, INC. - 20192021 Proxy Statement33



Each Element of Compensation Has itsIts Own Purpose
Our compensation program for Named Executive OfficersNEOs is made up of four primary elements outlined below. Each element has its own purpose based on our fundamental premise of pay for performance and our pay and benefits philosophy,
described on page 30. Additional information is provided below and on the following pages in the “About Our Compensation Elements: What We Paid in 20182020 and Why” section.
Compensation ElementPurpose
Base Salary
(See below)Pages 34 through 35)
Reflect scope of the role and individual performance through base-line cash compensation.
Performance-Based Annual
Cash Bonus
(Pages 35 andthrough 36)
Motivate and reward contributions to annual operating performance and long-term business strategy with cash that varies based on results.
Long-Term IncentivesLTIs
(PagePages 36 through 37)
Promote alignment of executive decisions with Company goals and shareholder interests through restricted stock unitsoptions, PSUs and RSUs where value varies with Company stock performance.
Benefits
(Page 38)
Provide meaningful and competitive broad-based, leadership and retirement benefits that support healthy lifestyles and contribute to financial security.
Pay Changes for 20182020
On an annual basis, the CommitteeCPCC reviews base salary, performance-based bonus target opportunity and long-term incentiveLTI target grant value for each of the Named Executive OfficersNEOs in consideration of the upcoming fiscal year. Committee decisions
The CPCC did not approve any changes to base salary, target bonus opportunity or target equity grant value for fiscal year 2018 are summarized below and shown as a comparisonany of 2017 and 2018 fiscal year end (“FYE”) amounts. the NEOs in 2020. The CommitteeCPCC believes these elements and the overall compensation program are meeting the expectations for our pay-for-performance and pay and benefits philosophies.
Base Salary in the table below reflects base salaries prior to temporary pay reductions implemented from March 29, 2020 to October 3, 2020, as discussed below.
LTI annual grant in the table below reflects target grant value as a percent of base salary. The CPCC retains discretion to approve grants above and below targets in any given year to reflect an individual’s contributions to delivering shareholder value. In 2020, the CPCC used its discretion to increase the LTI annual grant to 250% for Anne Bramman, 300% for Kenneth Worzel and 200% for Edmond Mesrobian, as discussed on page 36.
NameNameBase Salary
($)
Performance-Based
Annual Cash Bonus
(Target Opportunity
as a % of Base Salary)
LTI
Annual Grant
(Target Grant Value
as a % of Base Salary)*
 
Base Salary
($)
 
Performance-Based
Annual Cash Bonus
(Target Opportunity
as a % of Base Salary)
 
Long-Term Incentives
Annual Grant Target
(Grant Value as a % of
Base Salary)*
Name FYE 2017
 FYE 2018
 FYE 2017
 FYE 2018
 FYE 2017
 FYE 2018
Erik B. Nordstrom 758,500
 same
 200
 same
 350
 same
Erik B. Nordstrom758,500 200 350 
Anne L. Bramman 750,000
 775,000
 90
 same
 175
 same
Anne L. Bramman800,000 100 200 
Peter E. Nordstrom 758,500
 same
 200
 same
 350
 same
Peter E. Nordstrom758,500 200 350 
Kenneth J. Worzel 750,000
 800,000
 80
 125
 150
 250
Kenneth J. Worzel875,000 125 250 
Christine F. Deputy 567,000
 585,000
 80
 same
 150
 same
Blake W. Nordstrom 758,500
 
 200
 
 350
 
Edmond MesrobianEdmond Mesrobian775,000 80 150 
*
In 2017, actual annual long-term incentive grant values varied from target grant values for certain Named Executive Officers. See page 37 to learn more about the long-term incentive pay elements for 2018.
About Our Compensation Elements: What We Paid in 20182020 and Why
Impact of COVID-19 on Compensation
The COVID-19 pandemic has had a profound effect on the Company and its employees on many levels, including compensation. When the Company temporarily closed all store locations to protect the health of our employees and customers, on March 17, 2020, the decision was made to continue to pay store employees through April 5, 2020, and to continue to provide benefits to enrolled employees. The belief at that time was that the store closure would be quite short, but in the weeks that followed, it became clear it would be necessary for our stores to be closed to the public for a longer period.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role, and our Board elected to reduce their 2020 cash retainers by fifty percent (50%) and defer payment of their remaining cash retainers for the six months immediately following the 2020 Annual Meeting. Subsequently, in April 2020, a portion of our corporate employees were furloughed for six weeks, during which time the Company continued to make available benefits to enrolled employees.
NORDSTROM, INC. - 2021 Proxy Statement 34

Base Salary
The CommitteeCPCC begins its annual review of base salary for the Named Executive OfficersNEOs through discussion with the Co-PresidentsCEO and the President and Chief Brand Officer on the expectations and achievements of each executive during the previous year, as well as their pay history and pay equity with other internal roles. The CommitteeCPCC then references our pay levels to similar roles in peer companies to ensure they are within a competitive range of the peer group median. Named Executive OfficersNEOs do not necessarily receive increases in base salary every year. When they do, the changes are effective on or about April 1st
following their annual performance review, which includes a discussion about individual results against defined expectations.
For 2018, Anne Bramman, Kenneth WorzelAs discussed on the previous page, Erik Nordstrom and Christine Deputy eachPeter Nordstrom received increases inno base salary from March 29, 2020 to October 3, 2020, and the base salaries of approximately 3% to acknowledge performance and maintain relative market competitiveness. In addition, Kenneth Worzel received a base salary increase in May 2018 from $775,000 to $800,000 when he assumed additional responsibilities as Chief Digital Officer.the other NEOs were reduced by 25% during this period.

34 NORDSTROM, INC. - 2019 Proxy Statement  


Performance-Based Annual Cash Bonus
The opportunity for annual performance-based cash awards under our shareholder-approved Nordstrom, Inc. Executive Management Bonus Plan (“Executive Management Bonus Plan”)EMBP is designed to focus the Named Executive OfficersNEOs on the alignment between annual operating performance and long-term business strategy.
NEOs received no bonus under our program for 2020 as discussed below.
The CommitteeCPCC establishes the following criteria in developing the annual bonus arrangements:
Target bonus opportunity: In determining the target percentage of base salary, the CommitteeCPCC takes into account the mix of pay elements, market pay information for similar roles within our peer group and the internal relationship between roles within the Company.
In support of our pay-for-performance philosophy, the maximum bonus payout, which is associated with superior performance, is 2.5 times an executive’s target bonus opportunity. This maximum is higher than is common among our retail peers because we believe it is important to continue encouraging and paying rewards when we achieve truly superior results. Under our approach, truly superior results are rarely achieved. In the past nine10 years, we have not paid out bonuses in excess of 150% of target except for fiscal year 2010, when the payout was 200% of target.
In November 2017, the Committee approved an increase in Kenneth Worzel’s target bonus opportunity from 80% to 90% of base salary, effective at the beginning of fiscal year 2018. In May 2018, the Committee approved increasing his target bonus opportunity to 125%, effective as of the beginning of fiscal year 2018, to recognize his additional responsibilities as Chief Digital Officer.
Performance measures: The CommitteeCPCC establishes the performance measures to focus executives on the most important annual and long-term strategic goals. For fiscal year 2018,2020, the Named Executive OfficersNEOs had the following measures:
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders.
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold.
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders.
Incentive EBITto emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom, Peter Nordstrom and Blake Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Christine Deputy each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold.
Individual Measureto enable differentiation in bonus payout opportunity based on individual contributions and execution against goals. This measure was added for fiscal year 2018 for Anne Bramman, Kenneth Worzel and Christine Deputy. The individual bonus measure accounted for 33% of the total bonus opportunity for these Named Executive Officers.
The following charts showtable shows the mix of financial and individual components of the bonus opportunity for the Co-PresidentsCEO and the President and Chief Brand Officer and for the other Named Executive OfficersNEOs for fiscal year 2018.2020.
chart-e0bf8f4a0bff4863135a02.jpgchart-d891d61f5b4d0918ae3a02.jpg
CEO and President and Chief Brand Officer
100%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
Other NEOs
67%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
33%
Individual Measure
* Incentive EBIT measure is subject to the Incentive Adjusted ROIC threshold.
Performance measure milestones: The CommitteeCPCC defines financial milestones for Incentive Adjusted ROIC (as a threshold) and Incentive Adjusted EBIT (as a range) that relate to varying percentages of bonus payout. The difficulty level in achieving the milestones reflects the Committee’sCPCC’s belief that there should be a balance between executive pay opportunity, reinvestment in the Company and return to shareholders. Quantitative and qualitative goals were established for the individual bonusbonus measures.


NORDSTROM, INC. - 2019 Proxy Statement 35



In accordance with our bonus plan,EMBP, Incentive Adjusted ROICEBIT and Incentive EBITAdjusted ROIC achievement used to determine bonus payout may differ from ROICEBIT and EBIT,ROIC, as reported in our Form 10-K filed with the SEC,2020 Annual Report, due to the exclusion of certain one-time gains or losses. This is the case for 2018 where achievements reflect a non-operating related adjustment not included in the financial plan.In fiscal year 2020, Incentive Adjusted EBIT and Incentive Adjusted ROIC are the same as EBIT and ROIC as reported in our 2020 Annual Report. Incentive Adjusted EBIT and Incentive EBITAdjusted ROIC are not measures of financial performance under GAAP and should be considered in addition to, and not a substitute for, return on assets, net earnings, total assets or other financial measures prepared in accordance with GAAP. See Appendix A for a reconciliation of GAAP and non-GAAP financial measures.
Our Incentive Adjusted ROIC for our Named Executive Officers other than the Co-Presidents was 12.8% for fiscal 2018, exceeding our threshold goal of 9.5%. This result reflects an adjustment that the Committee approved to remove the impact of an estimated $72 million non-operating credit-related charge (see page 42 of the Company’s Annual Report on Form 10-K for the fiscal year ended February 2, 2019). The Committee did not approve this adjustment to Incentive Adjusted ROIC for the Co-Presidents. For that reason, their Incentive Adjusted ROIC result was 12.0%, which also exceeded the threshold goal of 9.5%.
Our Incentive EBIT achievement fell below our target goal of $941 million, warranting a payout level of less than 100%. As shown in the table below, the Incentive EBIT achievement for the Co-Presidents was 63%, and was 89% for the other Named Executive Officers. This achievement includes the above-noted adjustment to remove the impact of an estimated $72 million non-operating credit-related charge for the Named Executive Officers, excluding the Co-Presidents.
Achievement2020 Bonus Measures, Incentive Adjusted EBIT Milestones, results onIndividual Measure Achievement and Total Bonus Payout
Our Incentive Adjusted EBIT achievement fell below our threshold milestone of $645 million, resulting in a zero payout.
While significant progress was made against the qualitative and quantitative goals associated with the individual measure, the CPCC approved a zero payout on this portion of the bonus measures varied. opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian, given overall business results. Performance against the quantitative and qualitative goals, which were established at the beginning of the year, was evaluated by the Co-PresidentsCEO and the President and Chief Brand Officer and the payout results were approved by the Committee.CPCC.
After reviewing the Company’s Full-Price sales, Off-Price sales, selling, general and administrative expenses and free cash flow results for the fiscal year, the Committee determined that Anne Bramman achieved 100% of her target performance with respect to the aggregate individual performance measures.
35 NORDSTROM, INC. - 2021 Proxy Statement

After reviewing the Company’s Full-Price sales, Full-Price EBIT and total sales, and the Company’s market share results for the Los Angeles market, the Committee determined that Kenneth Worzel achieved 75% of his target performance with respect to the aggregate individual performance measures.
After reviewing the Company’s Full-Price sales, Off-Price sales, selling, general and administrative expenses and progress on organizational capabilities and effectiveness, the Committee determined that Christine Deputy achieved 100% of her target performance with respect to the aggregate individual performance measures.
The performance-based annual cash bonus results are summarized in the following table.
MilestonesTotal Bonus Payout
(as a % of Target)
NEOBonus MeasuresWeightThreshold (25%)Target (100%)Superior (250%)Result /
Payout %
Erik B. Nordstrom and
Peter E. Nordstrom
Incentive Adjusted EBIT100 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Anne L. BrammanIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Kenneth J. WorzelIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Edmond MesrobianIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
LTIs
Annual grants of equity under our shareholder-approved EIP are intended to provide the NEOs with additional incentive to create shareholder value and receive financial rewards. The LTI annual grant value to NEOs is expressed as a percentage of base salary as shown on page 34. In establishing the LTI annual grant value for each NEO, the CPCC considers the mix of pay elements, market pay information for similar roles within our peer group, our annual share usage and dilution, performance and internal equity of grant size by role. The CPCC typically approves LTI annual grants during the February CPCC meeting, which is scheduled at least a year in advance. The February meeting occurs after performance results for the prior year are known, which allows the CPCC to align compensation elements with our performance and business goals.
The CPCC used its discretion to increase the LTI annual grant value as a percentage of base salary for Anne Bramman, Kenneth Worzel and Edmond Mesrobian to recognize their increased responsibilities and/or to acknowledge their strong leadership in their functional areas.
2018 Bonus Measures, IncentiveAnne Bramman’s LTI annual grant was 250% of base salary to recognize her role in delivering expense savings well in excess of our expense target.
Kenneth Worzel’s LTI annual grant was 300% of base salary to recognize his increased responsibility in our newly established Chief Operating Officer role and his leadership as we have progressed our growing local market strategy.
Edmond Mesrobian’s LTI annual grant was 200% of base salary to recognize his progress in building a strong team delivering leading-edge systems capabilities.
For fiscal year 2020, the target LTI mix was composed of PSUs (60% of the grant value) and stock options (40% of the grant value) for the CEO and the President and Chief Brand Officer and PSUs (60% of the grant value) and RSUs (40% of the grant value) for the other NEOs. This mix provides a balance of the key retention and performance objectives of the LTI plan.
PSUs granted as part of the annual equity grant had a three-year performance cycle, from February 2, 2020 through January 28, 2023, and would have resulted in a payout if certain criteria were met. The core measures for the PSUs in this performance cycle, equally weighted, were free cash flow and EBIT Milestones, Individual Measure Achievementmargin percentage, with the Company’s market share serving as a payout modifier for the award. Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and Total Boperations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.onus Payout
   Milestones 
Total Bonus Payout
(as a % of Target)

Named Executive OfficerBonus MeasuresWeight
Threshold (25%)
Target (100%)
Superior (250%)
Result /
Payout %

Co-PresidentsIncentive EBIT100%
$728M
$941M≥$1,153M
$837M/
63%

63%
Subject to Incentive Adjusted ROIC threshold 9.5%  12.0%
Anne L. BrammanIncentive EBIT67%
$728M
$941M≥$1,153M
$909M/
89%

93%
Subject to Incentive Adjusted ROIC threshold 9.5%  12.8%
Individual Measure33%   100%
Kenneth J. WorzelIncentive EBIT67%
$728M
$941M≥$1,153M
$909M/
89%

84%
Subject to Incentive Adjusted ROIC threshold 9.5%  12.8%
Individual Measure33%   75%
Christine F. DeputyIncentive EBIT67%
$728M
$941M≥$1,153M
$909M/
89%

93%
Subject to Incentive Adjusted ROIC threshold 9.5%  12.8%
Individual Measure33%   100%
*The Incentive EBIT achievement for the Co-Presidents was less than that for the other Named Executive Officers as the Committee determined that the adjustment they approved to remove the impact of an estimated $72 million non-operating credit-related charge described above would not apply for the Co-Presidents. Also, the Committee approved a discretionary bonus for Blake Nordstrom in the amount of $82,026 so that the sum of his performance-based bonus and the discretionary award equaled what his performance-based bonus would have been had he been an active employee on the last day of the fiscal year.

36 NORDSTROM, INC. - 20192021 Proxy Statement 36


RSUs granted as part of the annual equity grant to the NEOs, excluding the CEO and the President and Chief Brand Officer, vest in four equal installments and complement our objectives for balancing award value through both absolute and relative stock performance.
Stock options granted as part of the annual grant to the CEO and the President and Chief Brand Officer vest and become exercisable in four equal annual installments and have a 10-year term. Our equity plan does not permit repricing, grant prices below 100% of the fair market value of Common Stock on the date of grant or cash dividend payments on options.
Two-Thirds of the 2019 PSUs are Still in Process
One-third of the PSUs granted in 2019 has a one-year performance period and two-thirds of the grant has a three-year performance period. The core measures for both performance periods are free cash flow growth and EBIT margin percent. At the end of the three-year performance period, market share results could adjust the number of shares that vest and are paid out up or down by up to 20%. At the end of the one-year performance period ended February 1, 2020, the thresholds for the core measures of free cash flow growth and EBIT margin percent were not achieved, so one-third of the PSU grant did not pay out, while two-thirds of the grant has time remaining in the performance period. The vest schedule for the remaining two-thirds of the 2019 PSU grant is shown below.
Performance Measures for Performance Period:
February 3, 2019 – January 29, 2022

Free Cash Flow Growth

EBIT Margin %
Percentage of Units that will Vest
≥31.4%≥7.1%200%
28.9%6.8%100%
26.3%6.5%50%
<26.3%<6.5%0%
Stock Ownership Guidelines Align Executives and Shareholders
Ownership of Common Stock by our NEOs and other Executive Officers is encouraged by management and the Board, and our stock ownership guidelines were formally established in 2004. Ownership shares are made up of all forms of Common Stock, as well as vested PSUs that are deferred and unvested RSUs. Ownership shares do not include unvested or vested stock options, unvested PSUs or pledged shares.
The NEOs and other Executive Officers have an annual share target defined as base salary on each April 1st multiplied by their ownership multiple of base salary divided by a 52-week average closing stock price. The ownership multiples of base salary depend on the executive’s role in the Company and are as shown in the following table for the NEOs. The CPCC has assigned these particular multiples to match or exceed market practice, and to represent a significant portion of the overall compensation package to reinforce the alignment of management’s decision-making with shareholder interests. Executives will be deemed to be in compliance with the Stock Ownership Guidelines once their holdings of Common Stock meet or exceed the threshold, and will remain in compliance, notwithstanding any decline in the value of Common Stock, unless and until the executive sells shares. However, a new target will be determined at the time an executive receives a promotion that results in an increased multiple of base salary or in the case of a one-time base salary increase greater than 20%. Executives would have five years to achieve the new target.
PositionMultiple of Base Salary Used to Establish Ownership Target
Chief Executive Officer10x
Chief Financial Officer4x
President and Chief Brand Officer10x
Chief Operating Officer4x
Chief Technology Officer3x
Under our guidelines, NEOs and other Executive Officers are required to conduct any open market transactions in Common Stock only in accordance with an SEC Rule 10b5-1 trading plan. These plans predetermine the timing, number of shares and price at which an Executive Officer may buy or sell Company shares. The Executive Officers must also achieve and retain a minimum holding of 100% of their ownership targets before they may sell or otherwise dispose of Company shares.
The CPCC regularly reviews stock ownership status for the NEOs. All of the NEOs have exceeded their ownership targets.
37 NORDSTROM, INC. - 2021 Proxy Statement

Benefits
The Company offers the NEOs a comprehensive program of broad-based, leadership and retirement benefits. Their purpose varies by benefit, but in general they enhance total compensation with meaningful and competitive offerings that support healthy lifestyles and contribute to financial security. These benefits are regularly reviewed for consistency with our pay and benefits philosophy, organizational culture and market practices.
Due to the economic impact of the COVID-19 pandemic, the Board made the decision to suspend the discretionary company match (equal to dollar for dollar, up to 4% of eligible pay) and the profit-based match (equal to up to an additional $0.50 per $1 up to a maximum of 2% of eligible pay, based on Company performance) under the 401(k) Plan for the 2020 plan year. As a result, neither the NEOs, nor any other
Company employees, received a Company matching contribution for the 2020 Plan Year.
Company matching contributions began again for the 2021 plan year for NEOs and all other Company employees under a new Qualified Automatic Contribution Arrangement (QACA) plan design. Beginning January 1, 2021, the NEOs and all other Company employees can contribute up to 50% of eligible pay, subject to IRC limits. Company matching contributions are made each pay period an employee contributes to the 401(k) Plan, equal to a dollar for dollar match up to 1% of eligible pay then $0.50 per dollar on the next 6% of eligible pay, up to a maximum of 4% of eligible pay and IRC limits.
Additional information on 2020 benefits is provided as noted below.
BenefitWhere to Learn More
Broad-Based●  Company contribution to medical, dental and vision coverage; short- and long-term disability; life insurance; adoption assistance; and employee referral assistance. Employee access to accident insurance; health savings account and flexible spending accounts; ESPP and merchandise discount. Paid time off (or Self-Managed Time Away for executives)●  For merchandise discount, see All Other Compensation in Fiscal Year 2020, footnote (a) on page 44.
LeadershipLong-term disability coverage; life insurance
For long-term disability and life insurance, see All Other Compensation in Fiscal Year 2020, footnote (c) on page 44.
NDCP; Company match and discretionary profit-based match for eligible participantsSee Nonqualified Deferred Compensation beginning on page 51.
Executive Severance PlanSee Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2020, footnote (e) on page 57.
Retirement
Discretionary 401(k) match and profit-based match (suspended for the 2020 plan year and modified for the 2021 plan year as discussed above)See All Other Compensation in Fiscal Year 2020, footnote (b) on page 44.
Retiree health care (closed to new entrants in 2013; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are participants as they were eligible prior to the closure to new entrants)See Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2020, footnote (d) on page 57.
SERP (annual benefit capped for current participants; closed to new entrants in 2012; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are participants as they were eligible prior to the closure to new entrants)See Pension Benefits beginning on page 50.
Changes for 2021
Each year, the CPCC reviews the design of our total compensation elements and makes changes as needed to improve alignment with our pay and benefits philosophy. At the February 2021 meeting, after consideration of recommendations made by the CPCC’s compensation consultant, the CPCC approved the following changesfor fiscal year 2021:
Base Salary
Anne Bramman, Kenneth Worzel and Edmond Mesrobian received increases of 2%, 2% and 3%, effective March 28, 2021, to maintain their relative market competitiveness.
Erik Nordstrom and Peter Nordstrom’s base salaries remained unchanged.
Performance-Based Annual Cash Bonus
The CPCC determined that the target bonus opportunity as a percent of base salary for the NEOs will remain unchanged for 2021.
The 2021 bonus opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian was modified to increase the emphasis on delivering profitable results. 100% of the bonus opportunity will be based on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold. The CPCC retains the ability to differentiate payouts based on individual contributions and execution against goals.
The 2021 bonus opportunity for Erik Nordstrom and Peter Nordstrom remains based 100% on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold.
NORDSTROM, INC. - 2021 Proxy Statement 38

Long-Term IncentivesBase Salary
Annual grants of equity under our shareholder-approved equity incentive plan are intended to provide the Named Executive Officers with additional incentive to create shareholder value and receive financial rewards. The long-term incentive value that determines the size(Pages 34 through 35)
Reflect scope of the role and individual performance through base-line cash compensation.
Performance-Based Annual
Cash Bonus
(Pages 35 through 36)
Motivate and reward contributions to annual grant to Named Executive Officers is expressed as a percentage of base salary as shown on page 34.
In establishing the long-term incentive value at grant for each Named Executive Officer, the Committee considers the mix of pay elements, market pay information for similar roles within our peer group, our annual share usage and dilution,operating performance and internal equitylong-term business strategy with cash that varies based on results.
LTIs
(Pages 36 through 37)
Promote alignment of grant size by role. The Committee typically approves annual grants of equity awards during the February Committee meeting, which is scheduled at least a year in advance. The February meeting occurs after performance results for the prior year are known, which allows the Committee to align compensation elementsexecutive decisions with our performanceCompany goals and business goals.
For fiscal year 2018 only, the grant for all of the Company’s Executive Officers, including the Named Executive Officers, was changed from a mix of restricted stock units, performance share units andshareholder interests through stock options, to 100% restrictedPSUs and RSUs where value varies with Company stock units, vesting equally over four years, which is consistent with the mix for all other eligible employees. This change resulted, in part, from the Committee’s deliberations following the announcement by the Nordstrom family group that it was exploring a potential going private transaction and the Committee’s determination to make awards which would remain relevant to executives and have some retention effect in the context of the uncertainty surrounding any potential transaction. The 2018 grant mix was a one-time response to a special circumstance and was not indicative of the Company’s pay strategy going forward. As described in the “Changes for 2019” section on page 39, the long-term incentive mix for 2019 is composed of performance-based equity and stock options for Erik Nordstrom and Peter Nordstrom and performance-based equity and restricted stock units for the other Named Executive Officers.
In November 2017, the Committee approved an increase in Kenneth Worzel’s target equity grant value from 150% to 175% of base salary, effective at the beginning of fiscal year 2018. In May 2018, the Committee approved increasing his target equity grant value to 250%, effective with the 2019 annual equity grant, to recognize his additional responsibilities as Chief Digital Officer.
One-Time Equity Awards
In March 2018, the Committee determined to award Anne Bramman, Kenneth Worzel and Christine Deputy restricted stock unit grants, equal to 300% of their respective base salaries, to mitigate retention risk and to recognize their critical roles in their respective functions and in supporting the Company’s key strategies over the next few years. The grants were made on March 6, 2018, the first day of the open trading window following Committee approval, and vest in four equal annual installments.
2016 Performance Share Units Did Not Pay Out
Performance share units for the 2016 – 2018 fiscal year performance cycle were granted based on the vesting schedule below. At the end of the performance cycle, our TSR did not meet the minimum threshold of greater than the 50th percentile of the Standard & Poor’s 500, which is required for payout. As a result, none of these performance share units vested.
performance.
Required Percentile Rank for Vesting% of Granted Performance Share Units Paid Out at Vesting
>90th175
>80th150
>75th125
>65th100
>50th75
≤50th
2017 Performance Share Units are Still in Process
The 3-year performance cycle for the 2017 performance share units runs from January 29, 2017 through February 1, 2020. The vesting schedule for the 2017 performance share unit grant is shown below. The peer group for this grant consists of companies in the Standard & Poor’s 500 as of the first day of the performance cycle.
Required Percentile Rank for Vesting% of Granted Performance Share Units Paid Out at Vesting
>85th175
>75th150
>65th125
>55th100
>40th50
≤40th


NORDSTROM, INC. - 2019 Proxy Statement 37



Stock Ownership Guidelines Align Executives and Shareholders
Ownership of Common Stock by our Named Executive Officers and other executive officers is encouraged by management and the Board and our stock ownership guidelines were formally established in 2004. Ownership shares are made up of all forms of Common Stock, as well as vested performance share units that are deferred and unvested restricted stock units. Ownership shares do not include unvested or vested stock options, unvested performance share units or pledged shares.
The Named Executive Officers and other Executive Officers have an annual share target defined as base salary on each April 1st multiplied by their ownership multiple of base salary divided by a 52-week average closing stock price. The ownership multiples of base salary depend on the executive’s role in the Company and are as shown in the following table for the Named Executive Officers. The Committee has assigned these particular multiples to match or exceed market practice, and to represent a significant portion of the overall compensation package to reinforce the alignment of management’s decision-making with shareholder interests. Executives new to the Company have five years to achieve their ownership target.
PositionMultiple of Base Salary Used to Establish Ownership Target
Co-President10x
Chief Financial Officer4x
Chief Digital Officer and President, Nordstrom.com3x
Chief Human Resources Officer3x
Under our guidelines, Named Executive Officers and other Executive Officers are required to conduct any open market transactions in Common Stock only in accordance with an SEC Rule 10b5-1 trading plan. These plans predetermine the timing, number of shares and price at which an Executive Officer may buy or sell Company shares. The Executive Officers must also achieve and retain a minimum holding of 100% of their ownership targets before they may sell Company shares in the market.
The Committee regularly reviews stock ownership status for the Named Executive Officers. All of the Named Executive Officers have exceeded their ownership targets.
Benefits
The Company offers the Named Executive Officers a comprehensive program of(Page 38)
Provide meaningful and competitive broad-based, leadership and retirement benefits. Their purpose varies by benefit, but in general enhances total compensation with meaningful and competitive offeringsbenefits that support healthy lifestyles and contribute to financial security.
Pay Changes for 2020
On an annual basis, the CPCC reviews base salary, performance-based bonus target opportunity and LTI target grant value for each of the NEOs in consideration of the upcoming fiscal year.
The CPCC did not approve any changes to base salary, target bonus opportunity or target equity grant value for any of the NEOs in 2020. The CPCC believes these elements and the overall compensation program are meeting the expectations for our pay-for-performance and pay and benefits philosophies.
Base Salary in the table below reflects base salaries prior to temporary pay reductions implemented from March 29, 2020 to October 3, 2020, as discussed below.
LTI annual grant in the table below reflects target grant value as a percent of base salary. The CPCC retains discretion to approve grants above and below targets in any given year to reflect an individual’s contributions to delivering shareholder value. In 2020, the CPCC used its discretion to increase the LTI annual grant to 250% for Anne Bramman, 300% for Kenneth Worzel and 200% for Edmond Mesrobian, as discussed on page 36.
NameBase Salary
($)
Performance-Based
Annual Cash Bonus
(Target Opportunity
as a % of Base Salary)
LTI
Annual Grant
(Target Grant Value
as a % of Base Salary)*
Erik B. Nordstrom758,500 200 350 
Anne L. Bramman800,000 100 200 
Peter E. Nordstrom758,500 200 350 
Kenneth J. Worzel875,000 125 250 
Edmond Mesrobian775,000 80 150 
About Our Compensation Elements: What We Paid in 2020 and Why
Impact of COVID-19 on Compensation
The COVID-19 pandemic has had a profound effect on the Company and its employees on many levels, including compensation. When the Company temporarily closed all store locations to protect the health of our employees and customers, on March 17, 2020, the decision was made to continue to pay store employees through April 5, 2020, and to continue to provide benefits to enrolled employees. The belief at that time was that the store closure would be quite short, but in the weeks that followed, it became clear it would be necessary for our stores to be closed to the public for a longer period.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role, and our Board elected to reduce their 2020 cash retainers by fifty percent (50%) and defer payment of their remaining cash retainers for the six months immediately following the 2020 Annual Meeting. Subsequently, in April 2020, a portion of our corporate employees were furloughed for six weeks, during which time the Company continued to make available benefits to enrolled employees.
NORDSTROM, INC. - 2021 Proxy Statement 34

Base Salary
The CPCC begins its annual review of base salary for the NEOs through discussion with the CEO and the President and Chief Brand Officer on the expectations and achievements of each executive during the previous year, as well as their pay history and pay equity with other internal roles. The CPCC then references similar roles in peer companies to ensure they are within a competitive range of the peer group median. NEOs do not necessarily receive increases in base salary every year. When they do, the changes are effective on or about April 1st
following their annual performance review, which includes a discussion about individual results against defined expectations.
As discussed on the previous page, Erik Nordstrom and Peter Nordstrom received no base salary from March 29, 2020 to October 3, 2020, and the base salaries of the other NEOs were reduced by 25% during this period.
Performance-Based Annual Cash Bonus
The opportunity for annual performance-based cash awards under our shareholder-approved Nordstrom, Inc. EMBP is designed to focus the NEOs on the alignment between annual operating performance and long-term business strategy.
NEOs received no bonus under our program for 2020 as discussed below.
The CPCC establishes the following criteria in developing the annual bonus arrangements:
Target bonus opportunity: In determining the target percentage of base salary, the CPCC takes into account the mix of pay elements, market pay information for similar roles within our peer group and the internal relationship between roles within the Company.
In support of our pay-for-performance philosophy, the maximum bonus payout, which is associated with superior performance, is 2.5 times an executive’s target bonus opportunity. This maximum is higher than is common among our retail peers because we believe it is important to continue encouraging and paying rewards when we achieve truly superior results. Under our approach, truly superior results are rarely achieved. In the past 10 years, we have not paid out bonuses in excess of 150% of target.
Performance measures: The CPCC establishes the performance measures to focus executives on the most important annual and long-term strategic goals. For fiscal year 2020, the NEOs had the following measures:
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders.
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold.
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
The following table shows the mix of financial and individual components of the bonus opportunity for the CEO and the President and Chief Brand Officer and for the other NEOs for fiscal year 2020.
CEO and President and Chief Brand Officer
100%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
Other NEOs
67%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
33%
Individual Measure
Performance measure milestones: The CPCC defines financial milestones for Incentive Adjusted ROIC (as a threshold) and Incentive Adjusted EBIT (as a range) that relate to varying percentages of bonus payout. The difficulty level in achieving the milestones reflects the CPCC’s belief that there should be a balance between executive pay opportunity, reinvestment in the Company and return to shareholders. Quantitative and qualitative goals were established for the individual bonus measures.
In accordance with our EMBP, Incentive Adjusted EBIT and Incentive Adjusted ROIC achievement used to determine bonus payout may differ from EBIT and ROIC, as reported in our 2020 Annual Report, due to the exclusion of certain one-time gains or losses. In fiscal year 2020, Incentive Adjusted EBIT and Incentive Adjusted ROIC are the same as EBIT and ROIC as reported in our 2020 Annual Report. Incentive Adjusted EBIT and Incentive Adjusted ROIC are not measures of financial performance under GAAP and should be considered in addition to, and not a substitute for, return on assets, net earnings, total assets or other financial measures prepared in accordance with GAAP. See Appendix A for a reconciliation of GAAP and non-GAAP financial measures.
2020 Bonus Measures, Incentive Adjusted EBIT Milestones, Individual Measure Achievement and Total Bonus Payout
Our Incentive Adjusted EBIT achievement fell below our threshold milestone of $645 million, resulting in a zero payout.
While significant progress was made against the qualitative and quantitative goals associated with the individual measure, the CPCC approved a zero payout on this portion of the bonus opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian, given overall business results. Performance against the quantitative and qualitative goals, which were established at the beginning of the year, was evaluated by the CEO and the President and Chief Brand Officer and the payout results were approved by the CPCC.
35 NORDSTROM, INC. - 2021 Proxy Statement

The performance-based annual cash bonus results are summarized in the following table.
MilestonesTotal Bonus Payout
(as a % of Target)
NEOBonus MeasuresWeightThreshold (25%)Target (100%)Superior (250%)Result /
Payout %
Erik B. Nordstrom and
Peter E. Nordstrom
Incentive Adjusted EBIT100 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Anne L. BrammanIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Kenneth J. WorzelIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Edmond MesrobianIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
LTIs
Annual grants of equity under our shareholder-approved EIP are intended to provide the NEOs with additional incentive to create shareholder value and receive financial rewards. The LTI annual grant value to NEOs is expressed as a percentage of base salary as shown on page 34. In establishing the LTI annual grant value for each NEO, the CPCC considers the mix of pay elements, market pay information for similar roles within our peer group, our annual share usage and dilution, performance and internal equity of grant size by role. The CPCC typically approves LTI annual grants during the February CPCC meeting, which is scheduled at least a year in advance. The February meeting occurs after performance results for the prior year are known, which allows the CPCC to align compensation elements with our performance and business goals.
The CPCC used its discretion to increase the LTI annual grant value as a percentage of base salary for Anne Bramman, Kenneth Worzel and Edmond Mesrobian to recognize their increased responsibilities and/or to acknowledge their strong leadership in their functional areas.
Anne Bramman’s LTI annual grant was 250% of base salary to recognize her role in delivering expense savings well in excess of our expense target.
Kenneth Worzel’s LTI annual grant was 300% of base salary to recognize his increased responsibility in our newly established Chief Operating Officer role and his leadership as we have progressed our growing local market strategy.
Edmond Mesrobian’s LTI annual grant was 200% of base salary to recognize his progress in building a strong team delivering leading-edge systems capabilities.
For fiscal year 2020, the target LTI mix was composed of PSUs (60% of the grant value) and stock options (40% of the grant value) for the CEO and the President and Chief Brand Officer and PSUs (60% of the grant value) and RSUs (40% of the grant value) for the other NEOs. This mix provides a balance of the key retention and performance objectives of the LTI plan.
PSUs granted as part of the annual equity grant had a three-year performance cycle, from February 2, 2020 through January 28, 2023, and would have resulted in a payout if certain criteria were met. The core measures for the PSUs in this performance cycle, equally weighted, were free cash flow and EBIT margin percentage, with the Company’s market share serving as a payout modifier for the award. Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.
NORDSTROM, INC. - 2021 Proxy Statement 36

RSUs granted as part of the annual equity grant to the NEOs, excluding the CEO and the President and Chief Brand Officer, vest in four equal installments and complement our objectives for balancing award value through both absolute and relative stock performance.
Stock options granted as part of the annual grant to the CEO and the President and Chief Brand Officer vest and become exercisable in four equal annual installments and have a 10-year term. Our equity plan does not permit repricing, grant prices below 100% of the fair market value of Common Stock on the date of grant or cash dividend payments on options.
Two-Thirds of the 2019 PSUs are Still in Process
One-third of the PSUs granted in 2019 has a one-year performance period and two-thirds of the grant has a three-year performance period. The core measures for both performance periods are free cash flow growth and EBIT margin percent. At the end of the three-year performance period, market share results could adjust the number of shares that vest and are paid out up or down by up to 20%. At the end of the one-year performance period ended February 1, 2020, the thresholds for the core measures of free cash flow growth and EBIT margin percent were not achieved, so one-third of the PSU grant did not pay out, while two-thirds of the grant has time remaining in the performance period. The vest schedule for the remaining two-thirds of the 2019 PSU grant is shown below.
Performance Measures for Performance Period:
February 3, 2019 – January 29, 2022

Free Cash Flow Growth

EBIT Margin %
Percentage of Units that will Vest
≥31.4%≥7.1%200%
28.9%6.8%100%
26.3%6.5%50%
<26.3%<6.5%0%
Stock Ownership Guidelines Align Executives and Shareholders
Ownership of Common Stock by our NEOs and other Executive Officers is encouraged by management and the Board, and our stock ownership guidelines were formally established in 2004. Ownership shares are made up of all forms of Common Stock, as well as vested PSUs that are deferred and unvested RSUs. Ownership shares do not include unvested or vested stock options, unvested PSUs or pledged shares.
The NEOs and other Executive Officers have an annual share target defined as base salary on each April 1st multiplied by their ownership multiple of base salary divided by a 52-week average closing stock price. The ownership multiples of base salary depend on the executive’s role in the Company and are as shown in the following table for the NEOs. The CPCC has assigned these particular multiples to match or exceed market practice, and to represent a significant portion of the overall compensation package to reinforce the alignment of management’s decision-making with shareholder interests. Executives will be deemed to be in compliance with the Stock Ownership Guidelines once their holdings of Common Stock meet or exceed the threshold, and will remain in compliance, notwithstanding any decline in the value of Common Stock, unless and until the executive sells shares. However, a new target will be determined at the time an executive receives a promotion that results in an increased multiple of base salary or in the case of a one-time base salary increase greater than 20%. Executives would have five years to achieve the new target.
PositionMultiple of Base Salary Used to Establish Ownership Target
Chief Executive Officer10x
Chief Financial Officer4x
President and Chief Brand Officer10x
Chief Operating Officer4x
Chief Technology Officer3x
Under our guidelines, NEOs and other Executive Officers are required to conduct any open market transactions in Common Stock only in accordance with an SEC Rule 10b5-1 trading plan. These plans predetermine the timing, number of shares and price at which an Executive Officer may buy or sell Company shares. The Executive Officers must also achieve and retain a minimum holding of 100% of their ownership targets before they may sell or otherwise dispose of Company shares.
The CPCC regularly reviews stock ownership status for the NEOs. All of the NEOs have exceeded their ownership targets.
37 NORDSTROM, INC. - 2021 Proxy Statement

Benefits
The Company offers the NEOs a comprehensive program of broad-based, leadership and retirement benefits. Their purpose varies by benefit, but in general they enhance total compensation with meaningful and competitive offerings that support healthy lifestyles and contribute to financial security. These benefits are regularly reviewed for consistency with our pay and benefits philosophy, organizational culture and market practices.
Due to the economic impact of the COVID-19 pandemic, the Board made the decision to suspend the discretionary company match (equal to dollar for dollar, up to 4% of eligible pay) and the profit-based match (equal to up to an additional $0.50 per $1 up to a maximum of 2% of eligible pay, based on Company performance) under the 401(k) Plan for the 2020 plan year. As a result, neither the NEOs, nor any other
Company employees, received a Company matching contribution for the 2020 Plan Year.
Company matching contributions began again for the 2021 plan year for NEOs and all other Company employees under a new Qualified Automatic Contribution Arrangement (QACA) plan design. Beginning January 1, 2021, the NEOs and all other Company employees can contribute up to 50% of eligible pay, subject to IRC limits. Company matching contributions are made each pay period an employee contributes to the 401(k) Plan, equal to a dollar for dollar match up to 1% of eligible pay then $0.50 per dollar on the next 6% of eligible pay, up to a maximum of 4% of eligible pay and IRC limits.
Additional information on 2020 benefits is provided as noted below.
BenefitWhere to Learn More
Broad-Based●  Company contribution to medical, dental and vision coverage; short- and long-term disability; life insurance; adoption assistance; and employee referral assistance. Employee access to accident insurance; health savings account and flexible spending accounts; ESPP and merchandise discount. Paid time off (or Self-Managed Time Away for consistency with our payexecutives)●  For merchandise discount, see All Other Compensation in Fiscal Year 2020, footnote (a) on page 44.
LeadershipLong-term disability coverage; life insurance
For long-term disability and benefits philosophy, organizational culture and market practices. Additional informationlife insurance, see All Other Compensation in Fiscal Year 2020, footnote (c) on 2018 benefits is provided as noted below.
BenefitWhere to Learn More
Broad-Based●  Company contribution to medical, dental and vision coverage; short- and long-term disability; life insurance; adoption assistance; and employee referral assistance. Employee access to accident insurance; health savings account and flexible spending accounts. Employee Stock Purchase Plan. Merchandise discount. Paid time off.●  For merchandise discount, see All Other Compensation in Fiscal Year 2018, footnote (a) on page 44.
Leadership
Salary continuance; long-term disability coverage; life insurance
For long-term disability and life insurance, see All Other Compensation in Fiscal Year 2018, footnote (d) on page 45.
Deferred Compensation Plan;page 44.
NDCP; Company match and discretionary profit-based match for eligible participantsSee Nonqualified Deferred Compensation beginning on page 53 and All Other Compensation in Fiscal Year 2018, footnote (c) on page 44.
Leadership Separation PlanSee Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2018, footnote (e) on page 59.
Retirement

401(k) match and discretionary profit-based matchSee All Other Compensation in Fiscal Year 2018, footnote (b) on page 44.
Retiree health care (closed to new entrants in 2013)

See Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2018, footnote (d) on page 59.
Supplemental Executive Retirement Plan (closed to new entrants in 2012; annual benefit capped for current participants)See Pension Benefits beginning on page 51.
Executive Severance PlanSee Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2020, footnote (e) on page 57.
Retirement
Discretionary 401(k) match and profit-based match (suspended for the 2020 plan year and modified for the 2021 plan year as discussed above)See All Other Compensation in Fiscal Year 2020, footnote (b) on page 44.
Retiree health care (closed to new entrants in 2013; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are participants as they were eligible prior to the closure to new entrants)See Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2020, footnote (d) on page 57.
SERP (annual benefit capped for current participants; closed to new entrants in 2012; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are participants as they were eligible prior to the closure to new entrants)See Pension Benefits beginning on page 50.
Changes for 2021
Each year, the CPCC reviews the design of our total compensation elements and makes changes as needed to improve alignment with our pay and benefits philosophy. At the February 2021 meeting, after consideration of recommendations made by the CPCC’s compensation consultant, the CPCC approved the following changesfor fiscal year 2021:
Base Salary
Anne Bramman, Kenneth Worzel and Edmond Mesrobian received increases of 2%, 2% and 3%, effective March 28, 2021, to maintain their relative market competitiveness.
Erik Nordstrom and Peter Nordstrom’s base salaries remained unchanged.
Performance-Based Annual Cash Bonus
The CPCC determined that the target bonus opportunity as a percent of base salary for the NEOs will remain unchanged for 2021.
The 2021 bonus opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian was modified to increase the emphasis on delivering profitable results. 100% of the bonus opportunity will be based on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold. The CPCC retains the ability to differentiate payouts based on individual contributions and execution against goals.
The 2021 bonus opportunity for Erik Nordstrom and Peter Nordstrom remains based 100% on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold.
NORDSTROM, INC. - 2021 Proxy Statement 38


38 NORDSTROM, INC. - 2019 Proxy Statement  


Changes for 2019
Each year, the Committee reviews the design of our total compensation elements and makes changes as needed to improve alignment with our pay and benefits philosophy. In consideration of recommendations made by the Committee’s compensation consultant, the following changes were made for fiscal year 2019:
Base Salary
Anne Bramman(Pages 34 through 35)
Reflect scope of the role and Christine Deputy each received increases of approximately 3%, effective April 1, 2019, to maintain their relative market competitiveness.
Erik Nordstrom, Peter Nordstrom and Kenneth Worzel’s base salaries remained unchanged.
individual performance through base-line cash compensation.
Performance-Based Annual
Cash Bonus
Anne Bramman’s target bonus opportunity as a percent(Pages 35 through 36)
Motivate and reward contributions to annual operating performance and long-term business strategy with cash that varies based on results.
LTIs
(Pages 36 through 37)
Promote alignment of base salary increased from 90%executive decisions with Company goals and shareholder interests through stock options, PSUs and RSUs where value varies with Company stock performance.
Benefits
(Page 38)
Provide meaningful and competitive broad-based, leadership and retirement benefits that support healthy lifestyles and contribute to 100% to maintain relative market competitivenessfinancial security.
Pay Changes for 2020
On an annual basis, the CPCC reviews base salary, performance-based bonus target opportunity and LTI target grant value for each of the NEOs in consideration of the upcoming fiscal year.
The CPCC did not approve any changes to base salary, target bonus opportunity or target equity grant value for any of the NEOs in 2020. The CPCC believes these elements and the overall compensation program are meeting the expectations for our pay-for-performance and pay and benefits philosophies.
Base Salary in the table below reflects base salaries prior to temporary pay reductions implemented from March 29, 2020 to October 3, 2020, as discussed below.
LTI annual grant in the table below reflects target grant value as a percent of base salary. The CPCC retains discretion to approve grants above and below targets in any given year to reflect an individual’s contributions to delivering shareholder value. In 2020, the CPCC used its discretion to increase the LTI annual grant to 250% for Anne Bramman, 300% for Kenneth Worzel and 200% for Edmond Mesrobian, as discussed on page 36.
NameBase Salary
($)
Performance-Based
Annual Cash Bonus
(Target Opportunity
as a % of Base Salary)
LTI
Annual Grant
(Target Grant Value
as a % of Base Salary)*
Erik B. Nordstrom758,500 200 350 
Anne L. Bramman800,000 100 200 
Peter E. Nordstrom758,500 200 350 
Kenneth J. Worzel875,000 125 250 
Edmond Mesrobian775,000 80 150 
About Our Compensation Elements: What We Paid in 2020 and Why
Impact of COVID-19 on Compensation
The COVID-19 pandemic has had a profound effect on the Company and its employees on many levels, including compensation. When the Company temporarily closed all store locations to protect the health of our employees and customers, on March 17, 2020, the decision was made to continue to pay store employees through April 5, 2020, and to continue to provide benefits to enrolled employees. The belief at that time was that the store closure would be quite short, but in the weeks that followed, it became clear it would be necessary for our stores to be closed to the public for a longer period.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role, and our Board elected to reduce their 2020 cash retainers by fifty percent (50%) and defer payment of their remaining cash retainers for the six months immediately following the 2020 Annual Meeting. Subsequently, in April 2020, a portion of our corporate employees were furloughed for six weeks, during which time the Company continued to make available benefits to enrolled employees.
NORDSTROM, INC. - 2021 Proxy Statement 34

Base Salary
The CPCC begins its annual review of base salary for the NEOs through discussion with the CEO and the President and Chief Brand Officer on the expectations and achievements of each executive during the previous year, as well as their pay history and pay equity with other internal roles. The CPCC then references similar roles in peer companies to ensure they are within a competitive range of the peer group median. NEOs do not necessarily receive increases in base salary every year. When they do, the changes are effective on or about April 1st
following their annual performance review, which includes a discussion about individual results against defined expectations.
As discussed on the previous page, Erik Nordstrom and Peter Nordstrom received no base salary from March 29, 2020 to October 3, 2020, and the base salaries of the other NEOs were reduced by 25% during this period.
Performance-Based Annual Cash Bonus
The opportunity for annual performance-based cash awards under our shareholder-approved Nordstrom, Inc. EMBP is designed to focus the NEOs on the alignment between annual operating performance and long-term business strategy.
NEOs received no bonus under our program for 2020 as discussed below.
The CPCC establishes the following criteria in developing the annual bonus arrangements:
Target bonus opportunity: In determining the target percentage of base salary, the CPCC takes into account the mix of pay elements, market pay information for similar roles within our peer group and the internal relationship between roles within the Company.
In support of our pay-for-performance philosophy, the maximum bonus payout, which is associated with superior performance, is 2.5 times an executive’s target bonus opportunity. This maximum is higher than is common among our retail peers because we believe it is important to continue encouraging and paying rewards when we achieve truly superior results. Under our approach, truly superior results are rarely achieved. In the past 10 years, we have not paid out bonuses in excess of 150% of target.
Performance measures: The CPCC establishes the performance measures to focus executives on the most important annual and long-term strategic goals. For fiscal year 2020, the NEOs had the following measures:
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders.
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold.
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
The following table shows the mix of financial and individual components of the bonus opportunity for the CEO and the President and Chief Brand Officer and for the other NEOs for fiscal year 2020.
CEO and President and Chief Brand Officer
100%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
Other NEOs
67%
Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold
33%
Individual Measure
Performance measure milestones: The CPCC defines financial milestones for Incentive Adjusted ROIC (as a threshold) and Incentive Adjusted EBIT (as a range) that relate to varying percentages of bonus payout. The difficulty level in achieving the milestones reflects the CPCC’s belief that there should be a balance between executive pay opportunity, reinvestment in the Company and return to shareholders. Quantitative and qualitative goals were established for the individual bonus measures.
In accordance with our EMBP, Incentive Adjusted EBIT and Incentive Adjusted ROIC achievement used to determine bonus payout may differ from EBIT and ROIC, as reported in our 2020 Annual Report, due to the exclusion of certain one-time gains or losses. In fiscal year 2020, Incentive Adjusted EBIT and Incentive Adjusted ROIC are the same as EBIT and ROIC as reported in our 2020 Annual Report. Incentive Adjusted EBIT and Incentive Adjusted ROIC are not measures of financial performance under GAAP and should be considered in addition to, and not a substitute for, return on assets, net earnings, total assets or other financial measures prepared in accordance with GAAP. See Appendix A for a reconciliation of GAAP and non-GAAP financial measures.
2020 Bonus Measures, Incentive Adjusted EBIT Milestones, Individual Measure Achievement and Total Bonus Payout
Our Incentive Adjusted EBIT achievement fell below our threshold milestone of $645 million, resulting in a zero payout.
While significant progress was made against the qualitative and quantitative goals associated with the individual measure, the CPCC approved a zero payout on this portion of the bonus opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian, given overall business results. Performance against the quantitative and qualitative goals, which were established at the beginning of the year, was evaluated by the CEO and the President and Chief Brand Officer and the payout results were approved by the CPCC.
35 NORDSTROM, INC. - 2021 Proxy Statement

The performance-based annual cash bonus results are summarized in the following table.
MilestonesTotal Bonus Payout
(as a % of Target)
NEOBonus MeasuresWeightThreshold (25%)Target (100%)Superior (250%)Result /
Payout %
Erik B. Nordstrom and
Peter E. Nordstrom
Incentive Adjusted EBIT100 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Anne L. BrammanIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Kenneth J. WorzelIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
Edmond MesrobianIncentive Adjusted EBIT67 %$645 M$840 M≥$1,036M($1,047M) / 0%%
Subject to Incentive Adjusted ROIC threshold8.6 %(8.5 %)
Individual Measure33 %%
LTIs
Annual grants of equity under our shareholder-approved EIP are intended to provide the NEOs with additional incentive to create shareholder value and receive financial rewards. The LTI annual grant value to NEOs is expressed as a percentage of base salary as shown on page 34. In establishing the LTI annual grant value for each NEO, the CPCC considers the mix of pay elements, market pay information for similar roles within our peer group, our annual share usage and dilution, performance and internal equity of grant size by role. The CPCC typically approves LTI annual grants during the February CPCC meeting, which is scheduled at least a year in advance. The February meeting occurs after performance results for the prior year are known, which allows the CPCC to align compensation elements with our performance and business goals.
The CPCC used its discretion to increase the LTI annual grant value as a percentage of base salary for Anne Bramman, Kenneth Worzel and Edmond Mesrobian to recognize their increased responsibilities and/or to acknowledge their strong leadership in their functional areas.
Anne Bramman’s LTI annual grant was 250% of base salary to recognize her role in delivering expense savings well in excess of our expense target.
Kenneth Worzel’s LTI annual grant was 300% of base salary to recognize his increased responsibility in our newly established Chief Operating Officer role and his leadership as we have progressed our growing local market strategy.
Edmond Mesrobian’s LTI annual grant was 200% of base salary to recognize his progress in building a strong team delivering leading-edge systems capabilities.
For fiscal year 2020, the target LTI mix was composed of PSUs (60% of the grant value) and stock options (40% of the grant value) for the CEO and the President and Chief Brand Officer and PSUs (60% of the grant value) and RSUs (40% of the grant value) for the other NEOs. This mix provides a balance of the key retention and performance objectives of the LTI plan.
PSUs granted as part of the annual equity grant had a three-year performance cycle, from February 2, 2020 through January 28, 2023, and would have resulted in a payout if certain criteria were met. The core measures for the PSUs in this performance cycle, equally weighted, were free cash flow and EBIT margin percentage, with the Company’s market share serving as a payout modifier for the award. Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.
NORDSTROM, INC. - 2021 Proxy Statement 36

RSUs granted as part of the annual equity grant to the NEOs, excluding the CEO and the President and Chief Brand Officer, vest in four equal installments and complement our objectives for balancing award value through both absolute and relative stock performance.
Stock options granted as part of the annual grant to the CEO and the President and Chief Brand Officer vest and become exercisable in four equal annual installments and have a 10-year term. Our equity plan does not permit repricing, grant prices below 100% of the fair market value of Common Stock on the date of grant or cash dividend payments on options.
Two-Thirds of the 2019 PSUs are Still in Process
One-third of the PSUs granted in 2019 has a one-year performance period and two-thirds of the grant has a three-year performance period. The core measures for both performance periods are free cash flow growth and EBIT margin percent. At the end of the three-year performance period, market share results could adjust the number of shares that vest and are paid out up or down by up to 20%. At the end of the one-year performance period ended February 1, 2020, the thresholds for the core measures of free cash flow growth and EBIT margin percent were not achieved, so one-third of the PSU grant did not pay out, while two-thirds of the grant has time remaining in the performance period. The vest schedule for the remaining two-thirds of the 2019 PSU grant is shown below.
Performance Measures for Performance Period:
February 3, 2019 – January 29, 2022

Free Cash Flow Growth

EBIT Margin %
Percentage of Units that will Vest
≥31.4%≥7.1%200%
28.9%6.8%100%
26.3%6.5%50%
<26.3%<6.5%0%
Stock Ownership Guidelines Align Executives and Shareholders
Ownership of Common Stock by our NEOs and other Executive Officers is encouraged by management and the Board, and our stock ownership guidelines were formally established in 2004. Ownership shares are made up of all forms of Common Stock, as well as vested PSUs that are deferred and unvested RSUs. Ownership shares do not include unvested or vested stock options, unvested PSUs or pledged shares.
The NEOs and other Executive Officers have an annual share target defined as base salary on each April 1st multiplied by their ownership multiple of base salary divided by a 52-week average closing stock price. The ownership multiples of base salary depend on the executive’s role in the Company and are as shown in the following table for the NEOs. The CPCC has assigned these particular multiples to match or exceed market practice, and to represent a significant portion of the overall compensation package to reinforce the alignment of management’s decision-making with shareholder interests. Executives will be deemed to be in compliance with the Stock Ownership Guidelines once their holdings of Common Stock meet or exceed the threshold, and will remain in compliance, notwithstanding any decline in the value of Common Stock, unless and until the executive sells shares. However, a new target will be determined at the time an executive receives a promotion that results in an increased multiple of base salary or in the case of a one-time base salary increase greater than 20%. Executives would have five years to achieve the new target.
PositionMultiple of Base Salary Used to Establish Ownership Target
Chief Executive Officer10x
Chief Financial Officer role.
Long-Term Incentives
The 2019 annual equity grant mix for the Co-Presidents was changed to 60% performance-based equity
4x
President and 40% stock options. This mix is closely aligned with the Company’s pay for performance philosophy. The 2019 annual grant mix for the other Named Executive Officers was changed to 60% performance-based equity and 40% restricted stock units. This mix provides a balance of the key retention and performance objectives of the long-term incentive plan. Performance-based equity was reintroduced into the annual grant mix to support the Company’s communicated forward-looking strategy. Free cash flow growth and EBIT margin percent are the core measures for the performance-based equity with market share serving as a payout modifier. The Committee believes that these measures reflect the Company’s key areas of strategic focus over the next three years. Two-thirds of the performance-based equity grant for 2019 has a three-year performance period. The remaining one-third of the performance-based equity grant for 2019 has a one-year performance period for the core measures and a three-year performance period for the market share modifier.
Anne Bramman’s target equity grant value as a percent of base salary increased from 175% to 200% to maintain relative market competitiveness for the Chief FinancialBrand Officer role.
10x
Chief Operating Officer4x
Chief Technology Officer3x
Under our guidelines, NEOs and other Executive Officers are required to conduct any open market transactions in Common Stock only in accordance with an SEC Rule 10b5-1 trading plan. These plans predetermine the timing, number of shares and price at which an Executive Officer may buy or sell Company shares. The Executive Officers must also achieve and retain a minimum holding of 100% of their ownership targets before they may sell or otherwise dispose of Company shares.
The CPCC regularly reviews stock ownership status for the NEOs. All of the NEOs have exceeded their ownership targets.
One-Time Option Grant
In February 2019, the Committee approved a one-time stock option award to key leadership to recognize the critical and important role that the executives will play in executing the Company’s communicated forward-looking strategy and delivering results to shareholders over the next few years. Anne Bramman, Kenneth Worzel and Christine Deputy received this award, representing options to purchase 123,554, 159,425 and 69,947 shares, respectively. The stock option award was granted on March 5, 2019, the first business day of the open trading window following the Committee’s approval of the grant. The stock options will vest over four years, with 50% vesting at the end of year three and 50% vesting at the end of year four.
Additional Information
37 NORDSTROM, INC. - 2021 Proxy Statement

Benefits
The Company offers the NEOs a comprehensive program of broad-based, leadership and retirement benefits. Their purpose varies by benefit, but in general they enhance total compensation with meaningful and competitive offerings that support healthy lifestyles and contribute to financial security. These benefits are regularly reviewed for consistency with our pay and benefits philosophy, organizational culture and market practices.
Due to the economic impact of the COVID-19 pandemic, the Board made the decision to suspend the discretionary company match (equal to dollar for dollar, up to 4% of eligible pay) and the profit-based match (equal to up to an additional $0.50 per $1 up to a maximum of 2% of eligible pay, based on Company performance) under the 401(k) Plan for the 2020 plan year. As a result, neither the NEOs, nor any other
Company employees, received a Company matching contribution for the 2020 Plan Year.
Company matching contributions began again for the 2021 plan year for NEOs and all other Company employees under a new Qualified Automatic Contribution Arrangement (QACA) plan design. Beginning January 1, 2021, the NEOs and all other Company employees can contribute up to 50% of eligible pay, subject to IRC limits. Company matching contributions are made each pay period an employee contributes to the 401(k) Plan, equal to a dollar for dollar match up to 1% of eligible pay then $0.50 per dollar on the next 6% of eligible pay, up to a maximum of 4% of eligible pay and IRC limits.
Additional information on 2020 benefits is provided as noted below.
Compensation Risk Assessment Supports Integrity of the Pay Program
The Committee oversees an extensive review of the Company’s pay-for-performance philosophy, the composition and balance of elements in the compensation package and the alignment of plans with shareholder interests to ensure these practices do not pose a material adverse risk to the organization. The review is conducted every other year as underlying programs and practices are generally consistent over time. The last review, for fiscal year 2018, concluded with the following perspectives:
The goals of the Company’s compensation programs are to attract and retain the best talent and to motivate and reward our people in ways that are aligned with the long-term interests of our shareholders. This has been a long-standing objective of our pay-for-performance philosophy. We believe that the strong alignment of our employee compensation plans with performance has served our stakeholders, and in particular, our shareholders, well. The strength of this alignment is regularly reviewed and monitored by the Committee.
As a leading fashion retailer, the Company’s compensation-related risks are generally more straightforward than some other business sectors. We have systems in place
BenefitWhere to identify, monitorLearn More
Broad-Based●  Company contribution to medical, dental and control risks, making it difficult for a single individual or a group of individuals to expose the Company to material compensation risk.
Our compensation program rewards bothvision coverage; short- and long-term performance. Performance measures are predominantly team-oriented rather than individually focuseddisability; life insurance; adoption assistance; and tiedemployee referral assistance. Employee access to measurable factors that are both transparent to shareholdersaccident insurance; health savings account and drivers of their shareholder return.
The compensation program balances the importance of achieving critical short-term objectives with a focusflexible spending accounts; ESPP and merchandise discount. Paid time off (or Self-Managed Time Away for executives)
●  For merchandise discount, see All Other Compensation in Fiscal Year 2020, footnote (a) on realizing strategicpage 44.
LeadershipLong-term disability coverage; life insurance
For long-term priorities. Strong stock ownership guidelines aredisability and life insurance, see All Other Compensation in placeFiscal Year 2020, footnote (c) on page 44.
NDCP; Company match and discretionary profit-based match for Company leaders, and mechanisms, such as an executive clawback policy, exist to address inappropriate rewards.


NORDSTROM, INC. - 2019 Proxy Statement 39



The Committee is actively engaged in establishing compensation plans, monitoring these plans during the year and using discretion in making rewards, as necessary.
The Company has active and engaged oversight systems in place. The Audit and Finance Committee and the full Board closely monitor and certify the performance that drives employee rewards through detailed and transparent financial reporting, which is in place to provide strong, timely insight into the performance of the Company.
Basedeligible participants
See Nonqualified Deferred Compensation beginning on this review, the Committee believes that the Company’s compensation plans do not encourage risk taking that is reasonably likely to have a material adverse effect on the Company.
page 51.
Executive Compensation Clawback Policy Applies to Performance-Based Pay
In February 2008, the Board adopted a formal executive compensation clawback policy that applies to any performance-based bonus, equity, equity equivalent or other incentive compensation awarded to an Executive Officer, beginning in that fiscal year. Under that policy, in the event of a material restatement of the Company’s financial results, the Board will review the circumstances that caused the restatement and consider accountability to determine whether an Executive Officer was negligent or engaged in misconduct. If so, and if the amount or vesting of an award would have been less had the financial statements been correct, the Board will seek to recover compensation from the Executive Officer as it deems appropriate. This policy is in addition to any requirements which might be imposed pursuant to applicable law.
Termination and Change in Control Provisions are Committee-Directed
Under our Leadership SeparationSeverance Plan eligible Company leaders, including certain Named Executive Officers, are entitled to receive severance benefits upon involuntary termination of employment by the Company, due to job elimination, to assist in the transition from active employment. Erik Nordstrom and Peter Nordstrom are not eligible for separation benefits under the Plan. Separation benefits are described in the
See Potential Payments Upon Termination or Change in Control sectionat Fiscal Year-End 2020, footnote (e) on page 59.
As described57.
Retirement
Discretionary 401(k) match and profit-based match (suspended for the 2020 plan year and modified for the 2021 plan year as discussed above)See All Other Compensation in the same section, the Named Executive OfficersFiscal Year 2020, footnote (b) on page 44.
Retiree health care (closed to new entrants in 2013; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are generally not entitled to any payment or accelerated benefit in connection with a change in control of the Company. However, the Named Executive Officers are entitled to accelerated vesting of equity ifparticipants as they experience a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control, unless the Committee acts to prevent such acceleration.
Tax and Accounting Considerations Underlie the Compensation Elements
The Committee recognizes the tax and regulatory factors that can influence the structure of executive compensation programs, including:
Section 162(m) of the Internal Revenue Code (“IRC”), which generally disallows a tax deduction to public companies for annual compensation over $1 million paid to their Named Executive Officers. Priorwere eligible prior to the enactment of corporate tax reformclosure to new entrants)
See Potential Payments Upon Termination or Change in 2017 (the “Tax Act”), the IRC generally excluded from the calculation of the $1 million limit compensation that was basedControl at Fiscal Year-End 2020, footnote (d) on the attainment of pre-established, objective performance goals established under a shareholder-approved plan. The exclusionpage 57.
SERP (annual benefit capped for performance-based compensation was repealed by the Tax Act, effective for taxable years beginning after December 31, 2017, such that compensation paidcurrent participants; closed to our Named Executive Officersnew entrants in excess of $1 million is not deductible unless it qualifies for transition relief applicable to certain arrangements in place2012; Erik Nordstrom, Peter Nordstrom and Kenneth Worzel are participants as of November 2, 2017. The Tax Act also expanded the category of covered officers for purposes of the limitations of Section 162(m). Following passage of the Tax Act, the Committee anticipates that compensation paidthey were eligible prior to the Company’s Namedclosure to new entrants)See Pension Benefits beginning on page 50.
Changes for 2021
Each year, the CPCC reviews the design of our total compensation elements and makes changes as needed to improve alignment with our pay and benefits philosophy. At the February 2021 meeting, after consideration of recommendations made by the CPCC’s compensation consultant, the CPCC approved the following changesfor fiscal year 2021:
Base Salary
Anne Bramman, Kenneth Worzel and Edmond Mesrobian received increases of 2%, 2% and 3%, effective March 28, 2021, to maintain their relative market competitiveness.
Erik Nordstrom and Peter Nordstrom’s base salaries remained unchanged.
Performance-Based Annual Cash Bonus
The CPCC determined that the target bonus opportunity as a percent of base salary for the NEOs will remain unchanged for 2021.
The 2021 bonus opportunity for Anne Bramman, Kenneth Worzel and Edmond Mesrobian was modified to increase the emphasis on delivering profitable results. 100% of the bonus opportunity will be based on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold. The CPCC retains the ability to differentiate payouts based on individual contributions and execution against goals.
The 2021 bonus opportunity for Erik Nordstrom and Peter Nordstrom remains based 100% on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold.
NORDSTROM, INC. - 2021 Proxy Statement 38

Long-Term Incentives
The CPCC used its discretion to increase the LTI grant value, as a percentage of base salary, above the target LTI grant values (which remained unchanged from fiscal year 2020) for the NEOs to recognize the criticality of their roles in continuing to deliver on strategic objectives that position the company for future growth.
Erik Nordstrom’s LTI annual grant was 488% of base salary to recognize his critical role in delivering results to shareholders over the next few years. The increase in Erik Nordstrom’s LTI grant value continues to result in competitive pay positioning below median of CEO roles within our peer group.
Peter Nordstrom’s LTI annual grant was 488% of base salary, to recognize the importance of his role in transforming our merchandising capabilities, optimizing inventory flow and expanding our supplier partnership models.
Anne Bramman’s LTI annual grant was 275% of base salary to recognize her role in ensuring the long-term sustainability of the organization and leading critical initiatives to maintain our financial disciplines.
Kenneth Worzel’s LTI annual grant was 275% of base salary to recognize his leadership on our growing local market strategy and on the ongoing integration of customer touchpoints that will deliver key customer outcomes and capture market share.
Edmond Mesrobian’s LTI annual grant was 300% of base salary to recognize his role in delivering significant technology innovation that will be critical to the achievement of our business strategy in years to come.
Due to the challenges of setting goals for PSUs in a highly variable environment, the CPCC approved changes in both the mix and vesting of LTI grants for the NEOs in fiscal year 2021.
Erik Nordstrom and Peter Nordstrom’s target LTI mix changed from 40% stock options and 60% PSUs to 100% price-vested stock options. Stock option vesting changed
from 25% each year over four years to 50% on March 10, 2024 and 50% on March 10, 2025, to account for the elimination of PSUs, which typically had a three-year cliff vest, and to emphasize the long-term nature of the award. Vesting is subject to the condition that the average daily closing price of the Company’s Common Stock meets or exceeds $45 per share for any twenty consecutive trading day period prior to March 10, 2025. For reference, our average closing price in fiscal year 2019 (pre-COVID) was $37.
Anne Bramman, Kenneth Worzel and Edmond Mesrobian’s LTI mix changed from 40% RSUs and 60% PSUs to 60% RSUs and 40% stock options. The CPCC made no change to RSU vesting, which will continue to vest 25% each year over four years. Stock options will vest 50% on March 10, 2024 and 50% on March 10, 2025.
Additional Information
Compensation Risk Assessment Supports Integrity of the Pay Program
The CPCC oversees an extensive review of the Company’s pay-for-performance philosophy, the composition and balance of elements in the compensation package and the alignment of plans with shareholder interests to ensure these practices do not pose a material adverse risk to the organization. The review is conducted every other year as underlying programs and practices are generally consistent over time. The last review, for fiscal year 2020, concluded with the following perspectives:
The goals of the Company’s compensation programs are to attract and retain the best talent and to motivate and reward our people in ways that are aligned with the long-term interests of our shareholders. This has been a long-standing
objective of our pay-for-performance philosophy. We believe that the strong alignment of our employee compensation plans with performance has well-served our stakeholders, and our shareholders in particular. The strength of this alignment is regularly reviewed and monitored by the CPCC.
We have systems in place to identify, monitor and control risks, making it difficult for a single individual or a group of individuals to expose the Company to material compensation risk.
Our compensation program rewards both short- and long-term performance. Performance measures for Company leaders are predominantly team-oriented rather than individually focused and tied to measurable factors that are both transparent to shareholders and drivers of their shareholder return.
39 NORDSTROM, INC. - 2021 Proxy Statement

The compensation program balances the importance of achieving critical short-term objectives with a focus on realizing strategic long-term priorities. Strong stock ownership guidelines are in place for Company leaders, and mechanisms, such as an executive clawback policy, exist to address inappropriate rewards.
The CPCC is actively engaged in establishing compensation plans, monitoring these plans during the year and using discretion in making rewards, as necessary.
The Company has active and engaged oversight systems in place. The AFC and the full Board closely monitor and certify the performance that drives employee rewards through detailed and transparent financial reporting, which is in place to provide strong, timely insight into the performance of the Company.
Based on this review, the CPCC believes that the Company’s compensation plans do not encourage risk taking that is reasonably likely to have a material adverse effect on the Company.
Executive Compensation Clawback Policy Applies to Performance-Based Pay
In February 2008, the Board adopted a formal executive compensation clawback policy that applies to any performance-based bonus, equity, equity equivalent or other incentive compensation awarded to an Executive Officer, beginning in that fiscal year. Under that policy, in the event of a material restatement of the Company’s financial results, the Board will review the circumstances that caused the restatement and consider accountability to determine whether an Executive Officer was negligent or engaged in misconduct. If so, and if the amount or vesting of an award would have been less had the financial statements been correct, the Board will seek to recover compensation from the Executive Officer as it deems appropriate. This policy is in addition to any requirements which might be imposed pursuant to applicable law.
Termination and Change in Control Provisions are CPCC-Directed
Under our Nordstrom, Inc. Executive Severance Plan, eligible Executive Officers, including certain NEOs, are entitled to receive severance benefits upon involuntary termination of employment by the Company to assist in the transition from active employment. To be eligible to participate in the Plan upon involuntary termination, the NEO must have signed a non-competition and non-solicitation agreement. Erik Nordstrom and Peter Nordstrom are not currently eligible for separation benefits under the Plan, and Anne Bramman has elected not to participate in the Plan. Separation benefits are described in the Potential Payments Upon Termination or Change in Control section beginning on page 52.

As described in the same section, the NEOs are generally not entitled to any payment or accelerated benefit in connection with a change in control of the Company. However, the NEOs are entitled to accelerated vesting of equity if they experience a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control, unless the Company and the CPCC does not act to to cause the NEOs to receive, on account of the equity award, cash or other property being paid to shareholders in the change in control transaction.
Tax and Accounting Considerations Underlie the Compensation Elements
The CPCC recognizes the tax and regulatory factors that can influence the structure of executive compensation programs, including:
Section 162(m) of the IRC, which generally disallows a tax deduction to public companies for annual compensation over $1 million paid to their NEOs. Prior to the enactment of the Tax Act, the IRC generally excluded from the calculation of the $1 million limit compensation that was based on the attainment of pre-established, objective performance goals established under a shareholder-approved plan. The exclusion for performance-based compensation was repealed by the Tax Act, effective for taxable years beginning after December 31, 2017, such that compensation paid to our NEOs in excess of $1 million is not deductible unless it qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017. The Tax Act also expanded the category of covered officers for purposes of the limitations of Section 162(m). Following passage of the Tax Act, the CPCC anticipates that compensation paid to the Company’s NEOs in excess of $1 million will not be deductible by the Company.
FASB ASC 718, where stock options, PSUs and RSUs are accounted for based on their grant date fair value (see the notes to the financial statements contained within the Company’s 2020 Annual Report). The CPCC regularly considers the accounting implications of our equity-based awards.
Section 409A of the IRC, the limitations of which primarily relate to the deferral and payment of benefits under the NDCP and SERP. The CPCC continues to consider the impact of Section 409A and in general, the evolving tax and regulatory landscape in which its compensation decisions are made.
NORDSTROM, INC. - 2021 Proxy Statement 40

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 718, Stock Compensation, (“ASC 718”), where stock options, performance share unitsPeople and restricted stock units are accounted for based on their grant date fair value (see the notes to the financial statements contained within the Company’s Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the SEC). The Committee regularly considers the accounting implications of our equity-based awards.
Section 409A of the IRC, the limitations of which primarily relate to the deferral and payment of benefits under the Nordstrom Deferred Compensation Plan and Supplemental Executive Retirement Plan. The Committee continues to consider the impact of Section 409A and in general, the evolving tax and regulatory landscape in which its compensation decisions are made.

40 NORDSTROM, INC. - 2019 Proxy Statement  


CompensationCulture Committee Report
The Compensation CommitteeCPCC has reviewed and discussed with management the Compensation Discussion and Analysis included in this Proxy Statement. The CommitteeCPCC believes the Compensation Discussion and Analysis represents the intent and actions of the CommitteeCPCC with regard to executive compensation and has recommended to the Board that it be included in this Proxy Statement for filing with the SEC.
Compensation, People and Culture Committee
tanya_domieraxcolor2.jpg
glenda_mcnealxcolor2.jpg
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Tanya L. Domier, ChairGlenda G. McNealBrad D. SmithMark J. Tritton
Compensation Committee
Tanya L. Domier, Chair
Glenda G. McNeal
Philip G. Satre
Brad D. Smith
Gordon A. Smith
41 NORDSTROM, INC. - 2021 Proxy Statement



NORDSTROM, INC. - 2019 Proxy Statement 41



Summary Compensation Table
The following table summarizes the total compensation paid or accrued by the Company for services provided by the Named Executive OfficersNEOs for fiscal years ended January 30, 2021, February 1, 2020 and February 2, 2019, February 3, 2018 and January 28, 2017.2019.
Name and Principal PositionFiscal YearSalary
($)(a)
Bonus
($)(b)
Stock Awards
($)(c)
Option Awards
($)(d)
Non-Equity Incentive Plan Compensation
($)(e)
Change in Pension Value and Nonqualified Deferred Compensation Earnings
($)(f)
All Other Compensation
($)(g)
Total
($)
Erik B. Nordstrom2020367,419 — 1,592,846 2,654,740 — 1,010,681 21,984 5,647,670 
Chief Executive Officer2019756,393 — 1,592,836 1,061,897 708,591 2,700,516 52,070 6,872,303 
 2018756,393 — 2,654,705 — 963,144 — 77,504 4,451,746 
Anne L. Bramman2020699,231 — 1,999,988 1,824,997 — — 14,411 4,538,627 
Chief Financial Officer2019793,750 — 1,549,974 1,859,994 564,500 — 39,912 4,808,130 
2018768,889 150,000 3,562,483 — 645,066 — 38,716 5,165,154 
Peter E. Nordstrom2020367,419 — 1,592,846 2,654,740 — 1,055,774 24,849 5,695,628 
President and Chief Brand Officer2019756,393 — 1,592,836 1,061,897 708,591 2,782,378 77,355 6,979,450 
2018756,393 — 2,654,705 — 963,144 — 59,386 4,433,628 
Kenneth J. Worzel2020764,597 — 2,624,977 2,374,996 — 864,312 18,367 6,647,249 
Chief Operating Officer2019826,111 — 1,999,970 2,400,000 645,433 1,589,618 37,080 7,498,212 
2018786,875 — 3,562,483 — 835,167 754,441 45,813 5,984,779 
Edmond Mesrobian2020677,214 — 1,549,973 1,374,995 — — 7,917 3,610,099 
Chief Technology Officer2019743,542 — 2,087,450 1,304,995 420,971 — 10,225 4,567,183 
2018— — — — — — — — 
Name and Principal PositionFiscal Year
Salary
($)(a)

Bonus
($)(b)

Stock Awards
($)(c)

Option Awards
($)(d)

Non-Equity Incentive Plan Compensation
($)(e)

Change in Pension Value and Nonqualified Deferred Compensation Earnings
($)(f)

All Other Compensation
($)(g)

Total
($)

Erik B. Nordstrom2018756,393

2,654,705

963,144

77,504
4,451,746
Co-President2017771,142

1,760,169
616,272
1,431,290
988,659
50,395
5,617,927
 2016751,152

1,630,746
1,437,210
1,213,601
721,831
46,222
5,800,762
Anne L. Bramman2018768,889
150,000
3,562,483

645,066

38,716
5,165,154
Chief Financial Officer2017504,173

749,965

430,384

316,516
2,001,038
2016







Peter E. Nordstrom2018756,393

2,654,705

963,144

59,386
4,433,628
Co-President2017771,142

1,760,169
616,272
1,431,290
1,030,787
40,774
5,650,434
 2016751,152

1,630,746
1,437,210
1,213,601
758,249
47,811
5,838,769
Kenneth J. Worzel2018786,875

3,562,483

835,167
754,441
45,813
5,984,779
Chief Digital Officer and President, Nordstrom.com2017762,500

749,703
262,497
574,620
725,676
32,380
3,107,376
2016657,417

1,742,820
907,475
424,932
412,356
35,880
4,180,880
Christine F. Deputy2018604,587

2,551,421

432,819

86,153
3,674,980
Chief Human Resources Officer2017







2016







Blake W. Nordstrom2018791,274
82,026
2,654,705

881,118

66,907
4,476,030
Former Co-President2017771,142

1,760,169
616,272
1,431,290
998,647
57,181
5,634,701
 2016751,152

1,630,746
1,437,210
1,213,601
748,859
49,711
5,831,279
(a)
(a)Salary
The amounts shown represent base salary earned during the fiscal year. The numbers shown for all fiscal years vary somewhat from annual base salaries due to the fact that our fiscal year ends on the Saturday nearest to January 31st and salary increases are effective on or about April 1st1st of each year. Also, as a result of our 4-5-4 retail reporting calendar, fiscal year 2017 included an extra week (the “53rd week”). The 20182020 base salaries for the Named Executive Officers were $758,500 each for Erik Nordstrom and Peter Nordstrom, and Blake Nordstrom, $775,000$800,000 for Anne Bramman, $875,000 for Kenneth Worzel and $585,000$775,000 for Christine Deputy. Kenneth Worzel’s base salary increased from $775,000 to $800,000 effective May 14, 2018, when he assumed additional responsibilities as Chief Digital Officer. The amount shown for Blake Nordstrom reflects a prorated amount based on his separation from service on January 2, 2019 and includes the payout of his accrued vacation pay. Christine DeputyEdmond Mesrobian. Edmond Mesrobian was not a Named Executive Officeran NEO in fiscal years 2016 or 2017year 2018, so no amounts are shown for those years.this year.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Christine Deputy elected to defer $25,000 and $30,800, respectively, of theirEdmond Mesrobian received a 25% base salaries earned during calendar year 2018 into the Nordstrom Deferred Compensation Plan (“NDCP”). salary reduction.
Anne Bramman and Christine Deputy elected to defer 8% and $32,000, respectively, of theirher base salariessalary earned during each of the calendar years 2020 and 2021 and 10% of her annual performance-based cash award paid in calendar year 20192020 into the NDCP. Kenneth Worzel elected to defer $50,000 of his base salary earned during each of the calendar years 2020 and 2021 into the NDCP. Edmond Mesrobian elected to defer $41,000 of his base salary earned in each of the calendar years 2020 and 2021 into the NDCP. Due to the timing of our fiscal year ends, $2,695, $23,913,$108,183, $49,826 and $30,852,$39,217 were attributed to fiscal year 20182020 deferrals for Anne Bramman, Kenneth Worzel and Christine Deputy,Edmond Mesrobian, respectively, as reported in the Fiscal Year 20182020 Nonqualified Deferred Compensation Plan Table on page 53.52.
Each of the Named Executive OfficersNEOs contributed a portion of their base salary earned during fiscal year 20182020 to the 401(k) Plan.
(b) Bonus
The amountsamount reported reflectfor fiscal year 2018 reflects a discretionary bonusesone-time cash payment, approved by the Compensation Committee. InCPCC in March 2018, the Committee determined to award Anne Bramman a one-time cash payment in recognition of her service since joining the Company in June 2017 as Chief Financial Officer. In February 2019, the Committee approved a discretionary bonus for Blake Nordstrom so that the sum of his performance-based bonus and this discretionary award equaled what his performance-based bonus would have been had he been an active employee on the last day of the fiscal year.

42 NORDSTROM, INC. - 20192021 Proxy Statement 42


(c) Stock Awards
The amounts reported reflect the grant date fair value of restricted stock unitsRSUs and performance share unitsPSUs granted during the fiscal year under the 2010 Equity Incentive Plan.and 2019 EIPs. The amounts reported are not the value actually received.
The valueShortly after the Named Executive Officers will ultimately receive from their performance share units will dependPSU grant was made on whetherMarch 9, 2020, the performance requirements are metCompany temporarily closed stores in response to the growing COVID-19 pandemic. Sales and operations were meaningfully disrupted. Accordingly, the market price of Common Stock atCPCC determined that the endgoals established with the PSU grant were no longer relevant or functional. On August 18, 2020, each of the performance cycle.NEOs agreed to the cancellation of their PSU award. The PSU grants to Erik Nordstrom and Peter Nordstrom each had a grant date fair value of $1,592,846. The PSU grants to Anne Bramman, Kenneth Worzel and Edmond Mesrobian had a grant date fair value of $1,199,989, $1,574,982 and $929,983, respectively. The amounts reported were calculated in accordance with FASB Accounting Standards Codification 718, Stock Compensation (“ASC 718”) and reflect718. See column (c) of the probable outcome with respect to satisfactionGrants of performance conditions atPlan-Based Awards in Fiscal Year 2020 table on page 45 for the datenumber of grant. The payout could be as low as zero depending on performance over the relevant period, and the value of any payout will depend on stock price at the time of payout.PSUs granted in fiscal year 2020. No amounts are reported for fiscal year 2018 as the Company did not award performance share unitsPSUs during thethat fiscal year.
The value the Named Executive OfficersNEOs may receive from their restricted stock unitsRSUs will depend on whether the time-based vesting requirement is met and the market price of Common Stock on the vesting date. The amounts reported were calculated in accordance with ASC 718. See column (c)(d) of the Grants of Plan-Based Awards in Fiscal Year 20182020 table on page 4645 for the number of restricted stock unitsRSUs granted in fiscal year 2018.2020.
(d) Option Awards
The amounts reported reflect the grant date fair value of stock options granted during the fiscal year under the 2010 Equity Incentive Plan.and 2019 EIPs. This is not the value received. The Named Executive OfficersNEOs will only realize value from stock options if the market price of Common Stock is higher than the exercise price of the options at the time of exercise. The amounts reported were calculated in accordance with ASC 718. See column (e) of the Grants of Plan-Based Awards in Fiscal Year 2020 table on page 45 for the number of stock options granted in fiscal year 2020. No amounts are reported for fiscal year 2018 as the Company did not grant stock options during thethat fiscal year.
Assumptions used in the calculation of these amounts are included in the notes to the financial statements contained within the Company’s 2020 Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the SEC.Report.
(e) Non-Equity Incentive Plan Compensation
The amounts reported reflect the annual performance-based cash awards under the Executive Management Bonus Plan,EMBP, as described beginning on page 35. The amounts of the cash awards for fiscal year 2018, approved by the Compensation Committee on February 26, 2019, were paid in March 2019. Kenneth Worzel elected to defer $50,000 of his cash award for fiscal year 2018 into the NDCP.
(f) Change in Pension Value and Nonqualified Deferred Compensation Earnings
The amounts reported are the changes in actuarial present value from fiscal year-end 20172019 to fiscal year-end 20182020 for each of the eligible Named Executive Officer’sNEO’s benefit under the Supplemental Executive Retirement Plan (“SERP”).SERP. The present value of the benefit is affected by current earnings, credited years of service, the executive’s age and time until normal retirement eligibility, the age of the executive’s spouse or life partner as the potential beneficiary and economic assumptions (discount rate and mortality table used to determine the present value of the benefit).
The present value of Erik Nordstrom’s and Peter Nordstrom’s benefits decreasedincreased from last year by $135,088$1,010,681 and $122,708,$1,055,774, respectively. The decreasesincreases were primarily the result of an increasea decrease in the discount rate used to determine the present value of the benefit. The interest rate used is the same as the discount rate used for financial reporting purposes for the SERP which changed from 3.95%2.97% to 4.27%2.62%. Under SEC rules, decreases are not reportedThe present value of Kenneth Worzel’s benefit increased by $864,312, primarily due to the change in the table so no amounts are shown. No amount is shown for Blake Nordstrom as he passed away before the end of the fiscal year, and accordingly did not have a pension benefit as of the end of the fiscal year.discount rate mentioned above along with an increase to service. Amounts are not reported for Anne Bramman and Christine DeputyEdmond Mesrobian because the SERP was closed to new entrants prior to when they joined the Company. See the Pension Benefits section beginning on page 5150 for more information about the SERP.
The amounts were calculated using the same discount rate and mortality table assumptions as those used in the Company’s financial statements to calculate the Company’s obligations under the SERP. Assumptions used in the calculation of these amounts are included in the notes to the financial statements contained within the Company’s 2020 Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the SEC.Report.
Anne Bramman, Kenneth Worzel and Christine DeputyEdmond Mesrobian had account balances in the Company’s nonqualified deferred compensation planNDCP in fiscal year 2018,2020, as shown on page 53.52. They did not receive above-market-rate or preferential earnings on their deferred compensation, so no amounts for these types of earnings are included in the table.
(g) All Other Compensation
Each component of all other compensation paid to the Named Executive OfficersNEOs is shown in the table on the following table.page.


43 NORDSTROM, INC. - 20192021 Proxy Statement43



All Other Compensation in Fiscal Year 2018
All Other Compensation in Fiscal Year 2020
The table below shows each component of “All Other Compensation” for fiscal year 2018,2020, reported in column (g) of the Summary Compensation Table on page 42, calculated at the aggregate incremental cost to the Company.
NameMerchandise Discount
($)(a)
401(k) Plan Company Match
($)(b)
Premium on Insurance
($)(c)
Total
($)
Erik B. Nordstrom17,602 2,334 2,048 21,984 
Anne L. Bramman10,405 1,846 2,160 14,411 
Peter E. Nordstrom21,168 1,633 2,048 24,849 
Kenneth J. Worzel13,670 2,334 2,363 18,367 
Edmond Mesrobian3,439 2,385 2,093 7,917 
 Broad-Based Benefit Broad-Based Retirement Benefit 
Leadership
Benefit
 Other  
Name
Merchandise Discount
($)(a)

 
401(k) Plan Company Match
($)(b)

 
NDCP Company Match
($)(c)

Premium on Insurance
($)(d)

SERP
($)(e)

 
Personal Use of Company Aircraft
($)(f)

 
Total
($)

Erik B. Nordstrom58,100
 15,840
 
1,939

 1,625
 77,504
Anne L. Bramman20,902
 15,840
 
1,974

 
 38,716
Peter E. Nordstrom39,995
 15,840
 
1,939

 1,612
 59,386
Kenneth J. Worzel27,948
 15,840
 
2,025

 
 45,813
Christine F. Deputy25,661
 15,840
 43,156
1,496

 
 86,153
Blake W. Nordstrom49,128
 15,840
 
1,939

 
 66,907
(a)
(a)Merchandise Discount
The Company provides a broad-based merchandise discount for its employees. The Named Executive OfficersNEOs were provided a discount of 33% for purchases at Nordstrom full-line stores and Nordstrom.com and 20% for purchases at Nordstrom Rack stores, Nordstromrack.com/HauteLookNordstromRack.com, HauteLook.com and our restaurants. A 40% discount is available at certain times of the year on specific merchandise. The merchandise discount provided to the Named Executive OfficersNEOs is the same as for all other eligible management and high-performing non-management employees of the Company. The amounts reported are the total discount the Named Executive OfficersNEOs received on their Nordstrom purchases during the fiscal year. The Company provides the same merchandise discount program for its Board, of Directors, as described on page 18.16.
(b)
(b)401(k) Plan Company Match
The Company offers a matching contribution on employee 401(k) contributions under the 401(k) Plan to all eligible employees, including the Named Executive Officers.NEOs. The Named Executive OfficersNEOs may defer up to 16% of their eligible pay (i.e., base salary, performance-based bonus and other taxable wages) into the Plan, subject to IRC limits.
AlthoughDue to the matching contribution iseconomic impact of the COVID-19 pandemic, the Board made the decision to suspend the discretionary and subjectcompany match (equal to change, the Company currently matches employee contributions for the Plan year, dollar for dollar, up to 4% of eligible pay. The 2018 calendar year compensation limit for eligible pay was $275,000, as set bypay) and the IRS. In 2018, the maximum Company matching contribution for the eligible Named Executive Officers was $11,000 (4% of $275,000).
The Company also offers a discretionaryprofit-based match (equal to up to an additional $0.50 per $1 up to a maximum of 2% of eligible pay, based on Company performance. Basedperformance) under the 401(k) Plan for the 2020 plan year. As a result, neither the NEOs, nor any other Company employees, received a Company matching contribution for the 2020 Plan Year.
Company matching contributions began again for the 2021 plan year for NEOs and all other Company employees under a new Qualified Automatic Contribution Arrangement (QACA) plan design. Beginning January 1, 2021, the NEOs and all other Company employees can contribute up to 50% of eligible pay, subject to IRC limits. Company matching contributions are made each pay period an employee contributes to the 401(k) Plan, equal to a dollar for dollar match up to 1% of eligible pay then $0.50 per dollar on the Company’s performance in 2018, the Board approvednext 6% of eligible pay, up to a discretionary matchmaximum of $0.44 per dollar contributed by the employee, up to 4% of eligible pay. The maximum Company discretionary match for the eligible Named Executive Officers was $4,840(44% of 4% of $275,000)for 2018.pay and IRC limits. The total Company matching contribution each of the eligible Named Executive OfficersNEOs received, in March 2019, for calendaras shown above, reflects this matching formula and was credited between January 1, 2021, the start of the plan year, 2018, was $15,840 as reported above.and January 30, 2021, the end of the Company’s fiscal year.
Contributions under the 401(k) Plan may be directed to any of 12 custom target retirement date funds or to any of 9nine individual investment alternatives, including Common Stock. The Plan also offers a self-directed brokerage option.
(c)
NDCP Company Match
The Company offers a dollar for dollar matching contribution, up to 4% of eligible pay over the 401(k) calendar year compensation limit, on deferrals into the NDCP by eligible participants. The Company may also make a discretionary profit-based match up to an additional 2% of eligible pay over the 401(k) calendar year compensation limit. Christine Deputy received the NDCP Company matching contribution on her 2018 deferrals. Anne Bramman and Kenneth Worzel also made deferrals into the NDCP during fiscal year 2018 but were not eligible for the NDCP Match. Anne Bramman did not defer any pay in calendar year 2018 and Kenneth Worzel is not eligible for the NDCP match as he is a participant in the Company’s SERP, as described beginning on page 51. See the Nonqualified Deferred Compensation section on page 53 for more information.

44 NORDSTROM, INC.(c) - 2019 Proxy Statement  


(d)
Premium on Insurance
The Company provides life insurance to the Named Executive OfficersNEOs in an amount equal to approximately 1.25 times their base salary and additional disability insurance. The amounts reported are the annual Company-paid premiums.
(e)
SERP
The Company has a SERP, in which certain Named Executive Officers participate. As described in the Pension Benefits section beginning on page 51, the SERP provides an annual benefit, paid upon retirement for the remaining life of the executive with a 50% annuity paid to the surviving spouse after the executive’s death. Although Blake Nordstrom was a SERP participant, he did not receive any SERP payments during the fiscal year and therefore no amount is reported in this table. Upon Blake Nordstrom’s death on January 2, 2019, his surviving spouse began receiving the 50% survivor annuity. For the period from January 2, 2019 to the end of our fiscal year, Blake Nordstrom’s surviving spouse received SERP benefit payments totaling $29,167.
(f)
Personal Use of Company Aircraft
The Company owns two aircraft which it uses for business purposes. On rare occasions, a Named Executive Officer may have a guest accompany the executive on a business trip on the Company’s aircraft as an additional passenger. Only the direct variable costs (i.e., costs the Company incurs solely as a result of the passenger being on the aircraft) are included in determining the aggregate incremental cost to the Company. When travel does not meet the IRS standard for business travel, the cost of the travel is imputed as income to the executive, which is the Company’s practice to fully disclose. The Company does not reimburse the Named Executive Officers for taxes incurred as a result of the imputed income.
In fiscal year 2018, Erik Nordstrom and Peter Nordstrom were each accompanied by a family member on one business trip. The costs reported are the total direct variable costs associated with the family member’s travel which include the tax deduction the Company was not able to take as a result of the nondeductible portion of the aircraft operating costs.


NORDSTROM, INC. - 20192021 Proxy Statement 4544



Grants of Plan-Based Awards in Fiscal Year 20182020
The following table discloses the potential range of payouts for for:
non-equity incentive plan awards granted in fiscal year 20182020. These awards are performance-based cash bonuses granted under the Executive Management Bonus Plan,EMBP, as described beginning on page 35. 35; and
EIP awards granted in fiscal year 2020. These awards are PSUs granted under the 2019 EIP, as described on pages 36 and 37.
The table also discloses discloses:
the grant date fair value of PSUs granted under the 2019 EIP in fiscal year 2020, as described on pages 36 and 37;
the number, price and grant date fair value of stock options granted under the 2019 EIP in fiscal year 2020, as described on pages 36 and 37; and
the number and grant date fair value of restricted stock unitsRSUs granted under the 2010 Equity Incentive Plan2019 EIP in fiscal year 20182020, as described on pagepages 36 and 37.
   
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards
(b)
 
Estimated Future Payouts Under Equity Incentive
Plan Awards
All Other
Stock
Awards:
Number of Shares
of Stock or Units (#)(c)
All Other
Option
Awards:
Number of Securities
Underlying Options
(#)
Exercise
or Base Price of
Option Awards
($/Sh)
Grant
Date Fair
Value of
Stock and Option Awards ($)(d)
Name and Award
Grant Date
(a)
Approval DateThreshold ($)
Target
($)

Maximum ($)
 Threshold (#)Target (#)Maximum (#)
Erik B. Nordstrom   
 
 
        
Executive
Management Bonus
  379,250
1,517,001
3,792,502
        
Restricted Stock Unit
Award
3/6/20183/3/2018 
 
 
    54,233  2,654,705
Anne L. Bramman   
 
 
        
Executive Management
Bonus
  174,375
697,500
1,743,751
        
Restricted Stock Unit
Award
3/6/20183/3/2018 
 
 
    72,778  3,562,483
Peter E. Nordstrom   
 
 
        
Executive Management
Bonus
  379,250
1,517,001
3,792,502
        
Restricted Stock Unit
Award
3/6/20183/3/2018 
 
 
    54,233  2,654,705
Kenneth J. Worzel   
 
 
        
Executive Management
Bonus
  247,875
991,500
2,478,752
        
Restricted Stock Unit Award3/6/20183/3/2018 
 
 
    72,778  3,562,483
Christine F. Deputy   
 
 
        
Executive Management Bonus  117,000
468,000
1,170,000
        
Restricted Stock Unit Award3/6/20183/3/2018 
 
 
    52,123  2,551,421
Blake W. Nordstrom   
 
 
        
Executive Management Bonus  379,250
1,517,001
3,792,502
        
Restricted Stock Unit Award3/6/20183/3/2018 
 
 
    54,233  2,654,705

Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards
(b)
Estimated Future Payouts Under Equity Incentive
Plan Awards
(c)
All Other
Stock
Awards:
Number of Shares
of Stock or Units (#)(d)
All Other
Option
Awards:
Number of Securities
Underlying Options
(#)(e)
Exercise
or Base Price of
Option Awards
($/Sh)(f)
Grant
Date Fair
Value of
Stock and Option Awards ($)(g)
Name and AwardGrant Date
(a)
Approval DateThreshold ($)Target
($)
Maximum ($)Threshold (#)Target (#)Maximum (#)
Erik B. Nordstrom        
EMBP  379,250 1,517,001 3,792,502    
PSU3/09/20202/26/202033,39366,786160,2861,592,846
Stock Option Award3/09/20202/26/2020147,40726.791,061,891
Stock Option Award8/27/20208/18/2020 245,82914.79 1,592,849
Anne L. Bramman    
EMBP 200,000 800,000 2,000,000 
PSU3/09/20202/26/202025,15750,314120,7531,199,989
RSU3/09/20202/26/2020 34,647   799,999
Stock Option Award8/27/20208/18/2020       281,65714.79 1,824,997
Peter E. Nordstrom
EMBP 379,250 1,517,001 3,792,502 
PSU3/09/20202/26/202033,39366,786160,2861,592,846
Stock Option Award3/09/20202/26/2020147,40726.791,061,891
Stock Option Award8/27/20208/18/2020 245,82914.79 1,592,849
Kenneth J. Worzel    
EMBP 273,437 1,093,750 2,734,375 
PSU3/09/20202/26/202033,01866,037158,4881,574,982
RSU3/09/20202/26/2020 45,474   1,049,995
Stock Option Award8/27/20208/18/2020       366,54014.79 2,374,996
Edmond Mesrobian    
EMBP 155,000 620,000 1,550,000 
PSU3/09/20202/26/202019,49638,99393,583929,983
RSU3/09/20202/26/2020 26,851   619,990
Stock Option Award8/27/20208/18/2020       212,207 14.79 1,374,995
4645 NORDSTROM, INC. - 20192021 Proxy Statement


(a) Grant Date
The grant date is the first business day of the open trading window that falls on or after the Compensation Committee’sCPCC approval of the grant.
(b) Estimated Future Payouts Under Non-Equity Incentive PlanNon-EIP Awards
The amounts shown report the range of possible cash payouts for fiscal year 20182020 associated with established levels of performance or achievement under the Executive Management Bonus Plan.EMBP. The amounts shown in the “Threshold,” “Target” and “Maximum” columns reflect the payout opportunity associated with established levels of performance or achievement, as discussed beginning on page 35. For there to be any payout, minimum performance milestones or achievement must be met.
Although the column heading refers to future payouts, fiscal year 20182020 performance-based bonuses have already been earned and were paidresulted in zero payout to the Named Executive OfficersNEOs in March 2019. These cash payments are2021, as reported in the Summary Compensation Table on page 42, in column (e), “Non-Equity Incentive Plan Compensation.”
(c) Estimated Future Payouts Under EIP Awards
(c)The numbers shown report the range of potential PSU payout for the 2020 grant. Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic. Sales and operations were meaningfully disrupted. Accordingly, the CPCC determined that the goals established with the PSU grant were no longer relevant or functional. On August 18, 2020, each of the NEOs agreed to the cancellation of their PSU award. Payouts are shown in units of 50%, 100% and 240% of the number of PSUs granted. No payout will be earned, as the PSUs were cancelled.
(d) All Other Stock Awards: Number of Shares of Stock or Units
The numbers shown report the number of restricted stock unitsRSUs granted to the Named Executive OfficersNEOs in fiscal year 20182020 under the 2010 Equity Incentive Plan. The restricted stock units2019 EIP. RSUs were granted on March 6, 20189, 2020 to Anne Bramman, Kenneth Worzel and Edmond Mesrobian and will vest equally over four years, beginning on March 10, 2019. The restricted stock units granted to Blake Nordstrom vested on an accelerated basis as2021.
(e) All Other Option Awards: Number of January 2, 2019. Securities Underlying Options
The numbers shown for Anne Bramman, Kenneth Worzelreport the number of stock options granted to the NEOs in fiscal year 2020 under the 2019 EIP. The stock option grants to Erik Nordstrom and Christine Deputy includePeter Nordstrom made on March 9, 2020 as part of the annual grant vest and become exercisable in four equal annual installments, beginning on March 10, 2021. The one-time restricted stock unit awards of 45,965, 45,965option grants to the NEOs made on August 27, 2020 vest and 34,749, respectively, asbecome exercisable on September 10, 2022. This one-time stock option award is discussed in the Compensation Discussion and Analysis on page 37.36.
(d)(f) Exercise or Base Price of Options Awards
The exercise price of the stock options granted on March 9, 2020 of $26.79 and August 27, 2020 of $14.79 was the closing price of Common Stock on the respective grant dates.
(g) Grant Date Fair Value of Stock and Option Awards
The grant date fair value of the restrictedPSUs, RSUs and stock unitsoptions was calculated in accordance with ASC 718.
The reported value for restricted stock unitsPSUs was calculated by multiplying the number of restricted stock unitsPSUs granted by the fair value of a PSU on the date of grant, which was $23.85 on March 9, 2020. No payout will be earned, as the PSUs were cancelled as described under footnote (c), Estimated Future Payouts Under EIP Awards,
The reported value for RSUs was calculated by multiplying the number of RSUs awarded by the fair value of a restricted stock unitRSU on the date of grant. The fair value for the grant, which was $23.09 on March 6, 2018 was $48.95. This is not the value received.9, 2020. The actual value the Named Executive OfficersNEOs may receive will depend on whether the time-based vesting requirement is met and the market price of Common Stock at the time of any vesting.
The reported value of stock options was calculated by multiplying the number of options awarded by the fair value of an option on the date of grant. The fair value for the grant on March 9, 2020 to Erik Nordstrom and Peter Nordstrom was $7.20. The fair value for the grant on August 27, 2020 to the NEOs was $6.48. The actual value received by the NEOs will be the number of options exercised multiplied by the difference between the stock price at the future exercise date and the grant price. The grant price on March 9, 2020 was $26.79 and the grant price on August 27, 2020 was $14.79.


NORDSTROM, INC. - 20192021 Proxy Statement 4746



Outstanding Equity Awards at Fiscal Year-End 20182020
The following table provides information on the current holdings of stock options and stock awards by the Named Executive OfficersNEOs as of the fiscal year ended February 2, 2019.January 30, 2021. The table includes vested but unexercised stock options, unvested stock options, unvested restricted stock unitsRSUs and performance share unitsPSUs with time remaining in the three-yearthree-
year performance cycle. Because Blake Nordstrom passed away prior to the end of the fiscal year, resulting in the transfer of all outstanding awards to his estate, nothing is reported for Blake Nordstrom in the table below. The vesting schedules for outstanding stock options and restricted stock unitsRSUs are provided on pages 4948 and 50.49. Information about the amount of Common Stock beneficially owned by the Named Executive OfficersNEOs is provided in the Beneficial Ownership Table on page 70.61.
 Option Awards Stock Awards
    
Equity Incentive Plan Awards:
Number of Securities Underlying Unexer-
cised Unearned Options
(#)
   
Number of Shares or Units of Stock That Have Not Vested
(#)(b)
Market Value of Shares or Units of Stock That Have Not Vested
($)
Equity Incentive Plan Awards:
Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)(c)

Equity Incentive Plan Awards:
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)(d)

  
Number of Securities
Underlying
Unexercised Options
(#)
Option Exercise Price
($)

Option Expiration Date 
NameGrant Date
Exer-
cisable

Unexer-
cisable (a)

 
Erik B. Nordstrom2/26/201077,609

 34.50
2/26/2020     
2/25/201169,637

 42.48
2/25/2021     
 2/22/201268,244

 49.15
2/22/2022     
 3/4/201399,563

 50.26
3/4/2023     
 3/3/201460,747

 57.16
3/3/2024     
 2/24/201534,497
11,499
 75.23
2/24/2025     
 2/24/2015   
     1,49967,950  
 2/29/2016   
     6,348287,755  
 2/29/201641,070
41,071
 51.32
2/28/2026     
 6/7/2016
10,838
 40.50
6/7/2026     
 6/7/2016      5,573252,624  
 2/28/2017   
       13,207
598,673
 2/28/20179,663
28,990
 46.66
2/28/2027     
 2/28/2017   
     20,724939,419  
 3/6/2018      52,2102,366,679  
Anne L. Bramman8/21/2017 
     12,234554,567  
3/6/2018 
     45,9652,083,593  
 3/6/2018      26,8131,215,433  
Peter E. Nordstrom2/26/201077,609

 34.50
2/26/2020     
2/25/201169,637

 42.48
2/25/2021     
 2/22/201268,244

 49.15
2/22/2022     
 3/4/201399,563

 50.26
3/4/2023     
 3/3/201460,747

 57.16
3/3/2024     
 2/24/201534,497
11,499
 75.23
2/24/2025     
 2/24/2015      1,49767,859  
 2/29/2016   
     6,338287,302  
 2/29/201641,070
41,071
 51.32
2/28/2026     
 6/7/2016
10,838
 40.50
6/7/2026     
 6/7/2016      5,573252,624  
 2/28/2017   
       13,207
598,673
 2/28/20179,663
28,990
 46.66
2/28/2027     
 2/28/2017   
     20,691937,923  
 3/6/2018      52,2102,366,679  

Option AwardsStock Awards
EIP Awards:
Number of Securities Underlying Unexer-
cised Unearned Options
(#)
Number of Shares or Units of Stock That Have Not Vested
(#)(b)
Market Value of Shares or Units of Stock That Have Not Vested
($)
EIP Awards:
Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)(c)
EIP Awards:
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)(d)
Number of Securities
Underlying
Unexercised Options
(#)
Option Exercise Price
($)
Option Expiration Date
NameGrant DateExer-
cisable
Unexer-
cisable (a)
Erik B. Nordstrom2/25/2011 69,63742.482/25/2021
2/22/2012 68,24449.152/22/2022
 3/4/2013 99,56350.263/4/2023
3/3/2014 60,74757.163/3/2024
2/24/2015 45,99675.232/24/2025
2/29/2016 82,14151.322/28/2026
6/7/2016 10,83840.506/7/2026
2/28/2017 28,9899,66446.662/28/2027
2/28/20176,908244,889
3/6/201826,106925,458
3/5/2019 18,26754,80245.333/5/2029
3/5/201912,543444,649
3/9/2020147,40726.793/9/2030
8/27/2020245,82914.798/27/2030
Anne L. Bramman3/6/201813,407475,278
3/6/201822,983814,747
3/5/2019123,55445.333/5/2029
3/5/20197,323259,600
3/5/201911,221397,784
3/9/202034,6471,228,236
8/27/2020281,65714.798/27/2030
Peter E. Nordstrom2/25/2011 69,63742.482/25/2021
2/22/2012 68,24449.152/22/2022
3/4/2013 99,56350.263/4/2023
3/3/2014 60,74757.163/3/2024
2/24/2015 45,99675.232/24/2025
2/29/2016 82,14151.322/28/2026
6/7/2016 10,83840.506/7/2026
2/28/2017 28,9899,66446.662/28/2027
2/28/20176,897244,499
3/6/201826,106925,458
3/5/2019 18,26754,80245.333/5/2029
3/5/201912,543444,649
3/9/2020147,40726.793/9/2030
8/27/2020245,82914.798/27/2030
4847 NORDSTROM, INC. - 20192021 Proxy Statement


Option AwardsStock Awards
EIP Awards:
Number of Securities Underlying Unexer-
cised Unearned Options
(#)
Number of Shares or Units of Stock That Have Not Vested
(#)(b)
Market Value of Shares or Units of Stock That Have Not Vested
($)
EIP Awards:
Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)(c)
EIP Awards:
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)(d)
Number of Securities
Underlying
Unexercised Options
(#)
Option Exercise Price
($)
Option Expiration Date
NameGrant DateExer-
cisable
Unexer-
cisable (a)
Kenneth J. Worzel3/4/2013 40,53650.263/4/2023
3/3/2014 26,14157.163/3/2024
2/24/2015 20,58575.232/24/2025
2/29/2016 38,05751.322/28/2026
6/7/2016 23,43340.506/7/2026
2/28/2017 12,3484,11646.662/28/2027
2/28/20172,942104,294
3/6/201812,906457,518
3/6/201822,983814,747
3/5/2019159,42545.333/5/2029
3/5/20199,449334,967
3/5/201913,938494,102
3/9/202043,7771,551,895
8/27/2020366,54014.798/27/2030
Edmond Mesrobian8/27/201819,052675,393
3/5/201986,68745.333/5/2029
 3/5/20195,138182,142
 3/5/20197,873279,098
 8/26/201925,680910,356
3/9/202026,851951,868
8/27/2020212,20714.798/27/2030
(a)Number of Securities Underlying Unexercised Options: Unexercisable
 Option Awards Stock Awards
    
Equity Incentive Plan Awards:
Number of Securities Underlying Unexer-
cised Unearned Options
(#)
   
Number of Shares or Units of Stock That Have Not Vested
(#)(b)
Market Value of Shares or Units of Stock That Have Not Vested
($)
Equity Incentive Plan Awards:
Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)(c)

Equity Incentive Plan Awards:
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)(d)

  
Number of Securities
Underlying
Unexercised Options
(#)
Option Exercise Price
($)

Option Expiration Date 
NameGrant Date
Exer-
cisable

Unexer-
cisable (a)

 
Kenneth J. Worzel3/4/201340,536

 50.26
3/4/2023     
3/3/201426,141

 57.16
3/3/2024     
 2/24/201515,438
5,147
 75.23
2/24/2025     
 2/24/2015      69731,595  
 2/29/2016      3,056138,528  
 2/29/201619,028
19,029
 51.32
2/28/2026     
 6/7/2016
23,433
 40.50
6/7/2026     
 6/7/2016      12,049546,181  
 11/21/2016      1,59672,347  
 2/28/2017        5,625
254,981
 2/28/20174,116
12,348
 46.66
2/28/2027     
 2/28/2017      9,170415,676  
 3/6/2018      26,8131,215,433  
 3/6/2018      45,9652,083,593  
Christine F. Deputy8/24/201515,070
5,024
 67.34
8/24/2025     
8/24/2015      1,51768,766  
 8/24/2015      3,254147,504  
 2/29/2016      2,674121,212  
 2/29/201616,650
16,650
 51.32
2/28/2026     
 6/7/2016
15,432
 40.50
6/7/2026     
 6/7/2016      7,935359,694  
 2/28/2017        5,497
249,179
 2/28/20174,021
12,066
 46.66
2/28/2027     
 2/28/2017      8,960406,157  
 3/6/2018      34,7491,575,172  
 3/6/2018      17,374787,563  
(a)Number of Securities Underlying Unexercised Options: Unexercisable
The following table shows the grant date, vesting schedule and expiration date for all unvested stock options as of the fiscal year ended February 2, 2019. AllJanuary 30, 2021. On March 5, 2019, Erik Nordstrom and Peter Nordstrom received a stock option grants havegrant with a four-year vesting schedule of 25% per year,year.
On March 5, 2019, Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a stock option grant with the exceptiona four-year vesting schedule of the grant on June 7, 2016, which vests 100% on June 10, 2019. All grants have a 10-year term.50% after years three and four.
Grant DateVesting ScheduleExpiration Date
2/24/201528/201725% per year with a remaining vesting date of 2/24/20193/10/20212/24/202528/2027
8/24/201525% per year with a remaining vesting date of 8/24/3/5/20198/24/2025
2/29/201625% per year with remaining vesting dates of 3/10/20192021, 3/10/2022 and 3/10/202020232/28/20263/5/2029
6/7/2016100% on 6/10/3/5/20196/7/202650% on 3/10/2022 and 50% on 3/10/20233/5/2029
2/28/20173/9/202025% per year with remaining vesting dates of 3/10/2019,2021, 3/10/20202022, 3/10/2023 and 3/10/202120242/28/20273/9/2030
8/27/2020100% vest on 9/10/20228/27/2030


NORDSTROM, INC. - 20192021 Proxy Statement 4948



(b)Number of Shares or Units of Stock That Have Not Vested
(b)Number of Shares or Units of Stock That Have Not Vested
The following table shows the grant date and vesting schedule for all unvested restricted stock unitsRSUs as of the fiscal year ended February 2, 2019. The restricted stock unit grants have a four-year vesting schedule of 25% per year with the following exceptions: Christine Deputy’s grant of 8,135 units on August 24, 2015 vests 20% per year over five years; the grant on June 7, 2016 vests 50% after each of years two and three; Kenneth Worzel’s grant of 4,788 units on November 21, 2016 vests 33% after each of years one and two and 34% after year three; and Anne Bramman’s grant of 18,350 units on August 21, 2017 vests 33% after each of years one and two and 34% after year three.
January 30, 2021.
Grant DateVesting Schedule
2/24/201528/201725% per year with a remaining vesting date of 2/24/20193/10/2021
8/24/201525% per year with a remaining vesting date of 8/24/2019
8/24/201520% per year with remaining vesting dates of 8/24/2019 and 8/24/2020
2/29/20163/6/201825% per year with remaining vesting dates of 3/10/20192021 and 3/10/20202022
6/7/20168/27/201850% in years 2 and 325% per year with a remaining vesting datedates of 6/9/10/20192021 and 9/10/2022
11/21/201633% in years 1 and 2 and 34% in year 3 with a remaining vesting date of 12/10/3/5/2019
2/28/201725% per year with remaining vesting dates of 3/10/2019,2021, 3/10/20202022, and 3/10/20212023
8/21/201726/201933% in years 1one and 2two and 34% in the final year 3 with remaining vesting dates of 9/10/20192021 and 9/10/20202022
3/6/20189/202025% per year with vesting dates of 3/10/2019,2021, 3/10/2020,2022, 3/10/20212023 and 3/10/20222024
(c)Equity Incentive Plan Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested
(c) EIP Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested
The PSUs granted on March 9, 2020 were cancelled on August 18, 2020, as discussed on page 36, and are not reflected in the above table. The numbers reported are the outstanding performance share unitsPSUs granted in fiscal year 2017. The2019. One-third of the PSUs are earned on the last day of the one-year performance sharecycle, February 1, 2020, if performance criteria have been met, and two-thirds of the units are earned on the last day of the three-year performance cycle, February 1, 2020,January 29, 2022, if performance criteria have been met, andmet. The 2019 PSUs vest when the results have been certified by the Compensation Committee. ThisCPCC at the end of the three-year performance cycle, January 29, 2022. For the performance cycle that ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant has time remaining in its three-year performance cycle. If the performance cycle for the remaining two-thirds of the grant had ended as of the close of fiscal year 2018, 50%2020, the performance payout threshold would not have been achieved and 0% of the number of performance share units grantedPSUs outstanding would have been earned.
As required to be disclosed by SEC rules, the number of estimated shares reported for the 2017remaining two-thirds of this grant is based on achieving the next higher performance measure, which pays out at 100%50% of the number of units granted,outstanding, as shown in the performance share unitPSU vesting schedule on page 37.
(d)Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
(d) EIP Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
The PSUs granted on March 9, 2020 were cancelled on August 18, 2020, as discussed on page 36, and are not reflected in the above table. The amounts reported relate to the outstanding performance share unitsPSUs granted in fiscal year 2017. This2019. One-third of the PSUs are earned on the last day of the one-year performance cycle, February 1, 2020, if performance criteria have been met, and two-thirds of the units are earned on the last day of the three-year performance cycle, January 29, 2022, if performance criteria have been met. The 2019 PSUs vest when the results have been certified by the CPCC at the end of the three-year performance cycle, January 29, 2022. For the performance cycle that ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant has time remaining in its three-year performance cycle.
If the performance cycle for thisthe remaining two-thirds of the grant had ended as of the close of fiscal year 2018, 50%2020, the performance payout threshold would not have been achieved and 0% of the number of performance share units grantedPSUs outstanding would have been earned.
As required to be disclosed by SEC rules, the payout values for the remaining two-thirds of this grant are reported and are based on achieving the next higher performance measure, which pays out at 100%50% of the number of units granted.outstanding. The value of estimated payouts has been calculated using the closing price of Common Stock on February 1, 2019,January 29, 2021, the last market trading day of the fiscal year, of $45.33.$35.45. The payout does not include estimated dividend amounts as the Company does not pay dividends on unvested performance share units.PSUs.

5049 NORDSTROM, INC. - 20192021 Proxy Statement


Option Exercises and Stock Vested in Fiscal Year 20182020
The following table provides information for the Named Executive Officers on:
NEOs on the number of shares of Common Stock acquired and value realized from stock option exercises in fiscal year 2018;PSUs and
the number of shares of Common Stock acquired and value realized from performance share units and restricted stock units RSUs that vested with respect to fiscal year 20182020.
 Option AwardsStock Awards
NameNumber of Shares
Acquired on Exercise
(#)
Value Realized
on Exercise
($)
Number of Shares Acquired on Vesting
(#)(a)
Value Realized on Vesting
($)(b)
Erik B. Nordstrom— — 23,134 627,163 
Anne L. Bramman— — 28,051 686,080 
Peter E. Nordstrom— — 23,118 626,729 
Kenneth J. Worzel— — 30,458 830,397 
Edmond Mesrobian— — 24,990 405,508 
(a) Number of Shares Acquired on Vesting
  Option Awards Stock Awards
Name 
Number of Shares
Acquired on Exercise
(#)

 
Value Realized
on Exercise
($)

 
Number of Shares Acquired on Vesting
(#)(a)

 
Value Realized on Vesting
($)(b)

Erik B. Nordstrom 169,717
 5,646,094
 22,718
 1,170,494
Anne L. Bramman 
 
 6,116
 400,537
Peter E. Nordstrom 169,717
 5,557,886
 21,061
 1,083,875
Kenneth J. Worzel 64,818
 1,298,088
 23,618
 1,260,447
Christine F. Deputy 
 
 22,412
 1,262,623
Blake W. Nordstrom 182,773
 6,914,212
 21,122
 1,087,145
(a)Number of Shares Acquired on Vesting
The numbers reported are the restricted stock unitsRSUs that vested during the fiscal year.
(b) Value Realized on Vesting
The numbersamounts reported are the value realized for Erik Nordstrom, Peter Nordstrom and Blake Nordstrom include 3,133, 2,023 and 2,023 shares, respectively, which vested on an accelerated basis in 2018 solely to satisfy Social Security, Medicare or income tax withholding obligations of retirement-eligible employees with respect to their restricted stock unit awards. The numbers reported for Blake Nordstrom include those restricted stock unitsthe RSUs that vested during the fiscal year, prior to his date of death, January 2, 2019. An additional 86,370 units vested on an accelerated basis upon his date of death.
(b)Value Realized on Vesting
The amounts disclosed for Erik Nordstrom, Peter Nordstrom and Blake Nordstrom include the number of shares of Common Stock withheld on vesting of restricted stock units to satisfy tax withholding obligations as described previously, multiplied by $52.99, the closing price of Common Stock on November 27, 2018, the vesting date. The amounts reported for Blake Nordstrom include the value received during the fiscal year, prior to his date of death, January 2, 2019. An additional $4,100,848 was realized from units that vested on an accelerated basis upon his date of death.year.
Pension Benefits
The Company’s original Supplemental Executive Retirement Plan (‘SERP”)SERP was introduced in the 1980s. Over the years, the plan design changed to better meet the purpose of encouraging designated executives to stay with Nordstrom throughout their careers and rewarding their significant and sustained contribution to the Company’s success by adding to their financial security upon retirement. TheBeginning in 2012, the SERP was closed to new entrants, beginning in 2012.entrants.
The Named Executive Officers,NEOs, except Anne Bramman and Christine Deputy,Edmond Mesrobian, who both joined the Company after the SERP had been closed to new entrants, are or were eligible for the SERP. The eligible Named Executive OfficersNEOs are entitled to receive their full retirement benefit at age 58. Their full benefit is equal to 1.6% multiplied by final average pay, as described in athe following paragraph, and their years of credited service, up to a maximum of 25 years. They may retire early and could receive a reduced benefit if they are between the ages of 53 and 57, inclusive, with at least 10 years of credited service and the Board approves the early retirement. The early retirement benefit is reduced 10% for each year that their retirement age is less than 58. If they retire after age 58, they are entitled to their full retirement benefit, increased with interest of 5% per year, compounded annually, for each full year worked beyond age 58, for a maximum of 10 years. The annual SERP benefit is capped at $700,000.$700,000 after any early retirement reductions are applied.
Final average pay is the average base salary and annual performance-based cash bonus of the highest 36 months over the longer of:
the most recent five years of service; or
the entire period of service after the executive’s 53rd birthday.



NORDSTROM, INC. - 2019 Proxy Statement 51



The annual SERP benefit is paid upon retirement for the remaining life of the executive with a 50% annuity paid to a surviving spouse or life partner after the executive’s death. A surviving spouse or life partner also receives a 50% survivor benefit if the executive dies before retiring. The amount of this survivor benefit depends on the executive’s age and years of credited service at the time of death. Blake Nordstrom was eligible for his full SERP benefit upon his death on January 2, 2019. His benefit will be paid as a 50% survivor benefit to his surviving spouse.
The SERP provides that no benefit will be paid to an executive whose employment is terminated for cause, which includes competitive behavior against the Company, as determined by the Compensation CommitteeCPCC in the exercise of its discretion in accordance with the Plan. The Compensation CommitteeCPCC also has discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct or in competitive behavior against the Company.
Information about payment of the SERP benefit related to change in control is provided on page 5856 in footnote (b) to the Potential Payments Upon Termination or Change in Control at Fiscal Year-End 20182020 table.
Because the SERP is a nonqualified deferred compensation plan, the Company is not obligated to fund it. However, the Company does set aside funds to assist in the payment of future benefit obligations. If the Company were to become insolvent, participants would be unsecured general creditors, and there is no guarantee that funds would be available to pay all creditors in full. See the notes to the financial statements contained within the Company’s 2020Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the SEC, for a discussion of the benefit obligation.
NORDSTROM, INC. - 2021 Proxy Statement 50

Fiscal Year 20182020 Pension Benefits Table
The following table shows the present value of the accumulated SERP benefit payable to each of the Named Executive Officers,NEOs, based on the number of years of service credited under the Plan to each Named Executive OfficerNEO and actuarial assumptions consistent with those used in the Company’s financial statements2020 Annual Report to calculate the Company’s obligations under the Plan. See the notesNote 7: Postretirement Benefits to the financial statements contained within the Company’s 2020Annual Report on Form 10-K for the fiscal year ended February 2, 2019, filed with the SEC, for a discussion of the benefit obligation and assumptions used.
Present Value of Accumulated Benefit
NamePlan NameAge
(a)
Number of Years Credited Service
(#)(b)
Full Retirement Benefit
($)(c)
Early Retirement Benefit
($)(d)
Payments During Last Fiscal Year
($)
Erik B. NordstromSERP57 25 14,288,063 14,933,660 — 
Anne L. Bramman— — — — — — 
Peter E. NordstromSERP58 25 15,071,070 — — 
Kenneth J. WorzelSERP56 11 5,390,814 4,697,771 — 
Edmond Mesrobian— — — — — — 
(a) Age
Name Plan Name
 
Age
(a)

 
Number of Years Credited Service
(#)(b)

 
Present Value of Accumulated Benefit
($)(c)

 
Payments During Last Fiscal Year
($)

Erik B. Nordstrom SERP
 55
 25
 10,576,866
 
Anne L. Bramman 
 51
 
 
 
Peter E. Nordstrom SERP
 56
 25
 11,232,918
 
Kenneth J. Worzel SERP
 54
 9
 2,936,884
 
Christine F. Deputy 
 53
 
 
 
Blake W. Nordstrom SERP
 
 
 
 
(a)Age
Age is as of February 2, 2019,January 30, 2021, the last day of the fiscal year.
(b)Number of Years Credited Service
(b) Number of Years Credited Service
Although Erik Nordstrom and Peter Nordstrom each have 39 or more than 25 years of service, the number of years of credited service under the SERP is capped at 25.
(c)Present Value of Accumulated Benefit
(c) Present Value of Accumulated Benefit: Full Retirement Benefit
The amounts shown are based on the full retirement age of 58. Erik Nordstrom and Peter Nordstrom haveis the only eligible NEO that has met the minimum full retirement age with at least 10 years of credited service and would be eligible to receive the SERP benefit having the present value as shown in the table above.
(d) Present Value of Accumulated Benefit: Early Retirement Benefit
Erik Nordstrom and Kenneth Worzel have met the minimum early retirement age and would be eligible for early retirement with prior approval from the Board. If the Board approvedThe early retirement present value benefit for Erik Nordstrom and Peter Nordstrom would be entitled to receive a reducedis an increase from his full retirement present value benefit because both benefits are limited by the $700,000 annual SERP benefit having present values as of the end of the fiscal year of $8,730,232 and $10,018,456, respectively. These amounts are reportedcap, which results in the Potential Payments Upon Termination or Change of Control at Fiscal Year-End 2018 table on page 55.same annual SERP benefit for his early retirement as for his full retirement.

52 NORDSTROM, INC. - 2019 Proxy Statement  


Nonqualified Deferred Compensation
The Company offers participation in the Nordstrom Deferred Compensation Plan (“NDCP”)NDCP to employees, including the Named Executive Officers,NEOs, who meet a minimum compensation threshold. Under this Plan, a participant may defer up to 80% of base salary, up to 100% of an annual performance-based bonus and up to 100% of any vested performance share units,PSUs, less applicable payroll taxes.
Deferral elections are irrevocable and are made in compliance with Section 409A of the IRC. If a participant’s NDCP deferrals cause a reduction in the Company’s 401(k) match contribution, the Company may deposit a make-up contribution into the participant’s NDCP account. The Company may also providesprovide a dollar for dollar matching contribution, up to 4% of eligible pay over the 401(k) calendar year compensation limit, on deferrals into the NDCP by eligible participants. The Company may also makeparticipants and a discretionary profit-based match up to an additional 2% of eligible pay over the 401(k) calendar year compensation limit. Participants in the Company’s SERP are not eligible for this matching contribution. Christine Deputy is not a participant inThe discretionary 401(k) match was suspended for the SERP and was eligible for and received a NDCP match for deferrals made in calendar2020 plan year 2018.as discussed on page 38.
Plan participants may direct their cash deferrals to deemed investment alternatives, priced and valued similar to retail mutual funds. As of the end of the fiscal year, the Company offered 18 deemed investment alternatives. In addition, Plan participants are offered a fixed rate option, which was 4.4%4.31% for calendar year 2018years 2020 and is 4.5% for calendar year 2019,2021, which is not subsidized by the Company but rather is a rate based on guaranteed contractual returns from a third-party insurance company provider. With the exception of the fixed rate fund, participants may change their investment allocations among these investment alternatives daily. Gains and losses for cash deferrals are credited to participant accounts daily, based on their investment elections. The deemed investment alternatives for cash do not include Common Stock. Vested performance share unitsPSUs that are deferred into the NDCP remain as stock units until distribution.
51 NORDSTROM, INC. - 2021 Proxy Statement

Fiscal Year 20182020 Nonqualified Deferred Compensation Table
The following table discloses information on nonqualified deferred compensation for the Named Executive OfficersNEOs under the Company’s NDCP for the fiscal year ended February 2, 2019.January 30, 2021. The Company’s SERP is also a nonqualified plan. Information regarding benefits payable to Named Executive OfficersNEOs under the SERP is provided on pages 5150 and 52.51.
NameExecutive Contributions in Last Fiscal Year
($)(a)
Registrant Contributions in Last Fiscal Year
($)
Aggregate Earnings in Last Fiscal Year
($)(b)
Aggregate Withdrawals/Distributions
($)
Aggregate Balance at Last Fiscal Year-End
($)(c)
Erik B. Nordstrom— — — — — 
Anne L. Bramman108,183 — 7,813 — 238,673 
Peter E. Nordstrom— — — — — 
Kenneth J. Worzel49,826 — 46,588 — 853,403 
Edmond Mesrobian39,217 — 53,564 — 189,152 
(a) Executive Contributions in Last Fiscal Year
Name 
Executive Contributions in Last Fiscal Year
($)(a)

 
Registrant Contributions in Last Fiscal Year
($)(b)

 
Aggregate Earnings in Last Fiscal Year
($)(c)

 
Aggregate Withdrawals/Distributions
($)

 
Aggregate Balance at Last Fiscal Year-End
($)(d)

Erik B. Nordstrom 
 
 
 
 
Anne L. Bramman 2,695
 
 5
 
 2,700
Peter E. Nordstrom 
 
 
 
 
Kenneth J. Worzel 23,913
 
 (21,675) 
 669,043
Christine F. Deputy 30,852
 43,156
 4,674
 
 137,300
Blake W. Nordstrom 
 
 
 
 
(a)Executive Contributions in Last Fiscal Year
The amounts reported are the deferrals made during the fiscal year.
(b)Registrant Contributions in Last Fiscal Year
The amount reported for Christine Deputy is the Company matching contribution on her deferrals during calendar year 2018 as described above.(b) Aggregate Earnings in Last Fiscal Year
(c)Aggregate Earnings in Last Fiscal Year
The amounts include the total interest or other earnings (loss) accrued in fiscal year 20182020 on the entire NDCP account balance, including deferred performance share units.PSUs.
(d)Aggregate Balance at Last Fiscal Year-End
(c) Aggregate Balance at Last Fiscal Year-End
The amounts shown are the total NDCP balances, including earnings on deferrals, as of February 2, 2019.January 30, 2021.


NORDSTROM, INC. - 2019 Proxy Statement 53



Potential Payments Upon Termination or Change in Control
The information on the following pages describes and quantifies certain amounts that would become payable under existing compensation plans if the Named Executive Officers’NEOs’ employment had terminated on February 2, 2019,January 30, 2021, the last day of the fiscal year. The amounts are based on each executive’s compensation and years of service as of that date and, if applicable, based on the closing price of Common Stock on February 1, 2019,January 29, 2021, the
last market trading day of the fiscal year, of $45.33.$35.45. The estimates are based on all relevant plans effective at the end of the fiscal year and information available at that time. Actual values would reflect specific circumstances at the time of any termination, the plans and provisions effective if and when a termination event occurs and any other applicable factors.
Employment Agreements
The Company does not have employment agreements with any Nordstrom employees, including the Named Executive Officers.NEOs. The Company maintains a leadership separationan executive severance plan to provide a broad group of leadership employeescertain NEOs an appropriate level of severance benefits in the event of involuntary separation of service, due to job elimination.not for cause. Except as described on the following pages, there are no agreements, arrangements or plans that entitle the Named Executive OfficersNEOs to enhanced benefits upon termination of their employment.

54 NORDSTROM, INC. - 20192021 Proxy Statement 52


Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2018
Potential Payments Upon Termination or Change in Control at Fiscal Year-End 2020
The following table shows various termination scenarios and payments that would be triggered under the Company’s compensation plans.
Name and Potential PaymentDeath
($)
Disability
($)
Retirement
($)
Termination
without Cause
($)
Qualifying Termination
Following a Change in
Control
($)
Erik B. Nordstrom
Continued or Accelerated Vesting of Equity Awards(a)
4,211,794 4,211,794 2,446,891 2,446,891 7,525,718 
Vested SERP Benefit(b)
7,154,525 — 14,933,660 14,933,660 14,933,660 
Life Insurance Proceeds(c)
948,125 — — — — 
Retiree Health Care Benefit(d)
223,861 474,261 474,261 474,261 474,261 
Separation Benefit(e)
— — — — — 
Disability Insurance Benefit(f)
— 35,000 — — — 
Executive Management Bonus(g)
— — — — — 
Total Value of Incremental Benefits12,538,305 4,721,055 17,854,812 17,854,812 22,933,639 
Anne L. Bramman
Continued or Accelerated Vesting of Equity Awards(a)
4,605,057 4,605,057 — — 8,735,080 
Vested SERP Benefit(b)
— — — — — 
Life Insurance Proceeds(c)
1,000,000 — — — — 
Retiree Health Care Benefit(d)
— — — — — 
Separation Benefit(e)
— — — — — 
Disability Insurance Benefit(f)
— 35,000 — — — 
Executive Management Bonus(g)
— — — — — 
Total Value of Incremental Benefits5,605,057 4,640,057 — — 8,735,080 
Peter E. Nordstrom
Continued or Accelerated Vesting of Equity Awards(a)
4,211,404 4,211,404 2,446,501 2,446,501 7,525,328 
Vested SERP Benefit(b)
7,741,440 15,071,070 15,071,070 15,071,070 15,071,070 
Life Insurance Proceeds(c)
948,125 — — — — 
Retiree Health Care Benefit(d)
206,127 427,636 427,636 427,636 427,636 
Separation Benefit(e)
— — — — — 
Disability Insurance Benefit(f)
— 35,000 — — — 
Executive Management Bonus(g)
— — — — — 
Total Value of Incremental Benefits13,107,096 19,745,110 17,945,207 17,945,207 23,024,034 
Kenneth J. Worzel
Continued or Accelerated Vesting of Equity Awards(a)
5,616,752 5,616,752 2,607,808 2,607,808 10,995,272 
Vested SERP Benefit(b)
2,409,514 — 4,697,771 4,697,771 4,697,771 
Life Insurance Proceeds(c)
1,093,750 — — — — 
Retiree Health Care Benefit(d)
232,281 496,762 496,762 496,762 496,762 
Separation Benefit(e)
— — — 1,334,809 — 
Disability Insurance Benefit(f)
— 35,000 — — — 
Executive Management Bonus(g)
— — — — — 
Total Value of Incremental Benefits9,352,297 6,148,514 7,802,341 9,137,150 16,189,805 
Edmond Mesrobian
Continued or Accelerated Vesting of Equity Awards(a)
3,592,174 3,592,174 — — 7,200,912 
Vested SERP Benefit(b)
— — — — — 
Life Insurance Proceeds(c)
968,750 — — — — 
Retiree Health Care Benefit(d)
— — — — — 
Separation Benefit(e)
— — — 1,554,200 — 
Disability Insurance Benefit(f)
— 35,000 — — — 
Executive Management Bonus(g)
— — — — — 
Total Value of Incremental Benefits4,560,924 3,627,174 — 1,554,200 7,200,912 
Name and Potential Payment 
Death
($)

 
Disability
($)

 
Retirement
($)

 
Termination
without Cause
($)

 
Qualifying Termination
Following a Change in
Control
($)

Erik B. Nordstrom          
Continued or Accelerated Vesting of Equity Awards(a)
 4,166,952
 4,166,952
 3,861,980
 3,861,980
 4,266,134
Vested SERP Benefit(b)
 4,220,346
 
 8,730,232
 8,730,232
 8,730,232
Life Insurance Proceeds(c)
 948,125
 
 
 
 
Retiree Health Care Benefit(d)
 159,465
 362,387
 362,387
 362,387
 362,387
Separation Benefit(e)
 
 
 
 
 
Disability Insurance Benefit(f)
 
 35,000
 
 
 
Executive Management Bonus(g)
 
 
 
 
 
Total Value of Incremental Benefits 9,494,888
 4,564,339
 12,954,599
 12,954,599
 13,358,753
Anne L. Bramman          
Continued or Accelerated Vesting of Equity Awards(a)
 3,853,594
 3,853,594
 
 
 3,853,594
Vested SERP Benefit(b)
 
 
 
 
 
Life Insurance Proceeds(c)
 968,750
 
 
 
 
Retiree Health Care Benefit(d)
 
 
 
 
 
Separation Benefit(e)
 
 
 
 400,564
 400,564
Disability Insurance Benefit(f)
 
 35,000
 
 
 
Executive Management Bonus(g)
 
 
 
 
 
Total Value of Incremental Benefits 4,822,344
 3,888,594
 
 400,564
 4,254,158
Peter E. Nordstrom          
Continued or Accelerated Vesting of Equity Awards(a)
 4,164,912
 4,164,912
 3,859,940
 3,859,940
 4,264,094
Vested SERP Benefit(b)
 5,090,904
 
 10,018,456
 10,018,456
 10,018,456
Life Insurance Proceeds(c)
 948,125
 
 
 
 
Retiree Health Care Benefit(d)
 150,366
 333,284
 333,284
 333,284
 333,284
Separation Benefit(e)
 
 
 
 
 
Disability Insurance Benefit(f)
 
 35,000
 
 
 
Executive Management Bonus(g)
 
 
 
 
 
Total Value of Incremental Benefits 10,354,307
 4,533,196
 14,211,680
 14,211,680
 14,615,834
Kenneth J. Worzel          
Continued or Accelerated Vesting of Equity Awards(a)
 4,701,801
 4,701,801
 
 
 4,744,049
Vested SERP Benefit(b)
 1,494,790
 
 
 
 
Life Insurance Proceeds(c)
 1,000,000
 
 
 
 
Retiree Health Care Benefit(d)
 
 
 
 
 
Separation Benefit(e)
 
 
 
 549,455
 549,455
Disability Insurance Benefit(f)
 
 35,000
 
 
 
Executive Management Bonus(g)
 
 
 
 
 
Total Value of Incremental Benefits 7,196,591
 4,736,801
 
 549,455
 5,293,504
Christine F. Deputy          
Continued or Accelerated Vesting of Equity Awards(a)
 3,623,921
 3,623,921
 
 
 3,665,217
Vested SERP Benefit(b)
 
 
 
 
 
Life Insurance Proceeds(c)
 731,250
 
 
 
 
Retiree Health Care Benefit(d)
 
 
 
 
 
Separation Benefit(e)
 
 
 
 308,622
 308,622
Disability Insurance Benefit(f)
 
 35,000
 
 
 
Executive Management Bonus(g)
 
 
 
 
 
Total Value of Incremental Benefits 4,355,171
 3,658,921
 
 308,622
 3,973,839


53 NORDSTROM, INC. - 20192021 Proxy Statement55



(a) Continued or Accelerated Vesting of Equity Awards
(a)
Continued or Accelerated Vesting of Equity Awards
As of the end of fiscal year 2018,2020, the Named Executive OfficersNEOs had outstanding equity awards under our 20042010 and 2010 Equity Incentive Plans.2019 EIPs. Treatment of the awards under various termination scenarios is described below.
Stock Options
Death or Disability
The stock option agreements under the Company’s 2004 and 2010 Equity Incentive PlanEIP, with the exception of the 2019 stock option agreement, provide that if a participant’s employment is terminated by reason of death or disability, stock options granted more than six months prior to the termination event will immediately vest. The stock option agreements provide that if a participant’s employment is terminated by reason of death or disability, vested stock options may be exercised by the participant or participant’s beneficiary during the period ending four years after termination, provided the 10-year term of the grant has not expired.
The Company’s 2019 and 2020 stock option agreement for annual awards provides that if a participant’s employments is terminated by reason of death or disability, the stock option grants will immediately vest. The 2019 and 2020 annual stock option agreement provides that if a participant’s employment is terminated by reason of death or disability, vested stock options may be exercised by the participant or participant’s beneficiary during the period ending four years after termination, provided the 10-year term of the grant has not expired.
The Company’s 2019 and 2020 stock option agreement for one-time awards provides that if a participant’s employment is terminated by reason of death or disability, a prorated number of the stock options granted will immediately vest based on the number of full months employed. The 2019 and 2020 one-time stock option agreement provides that if a participant’s employment is terminated by reason of death or disability, vested stock options may be exercised by the participant or participant’s beneficiary during the period ending four years after termination, provided the 10-year term of the grant has not expired.
The amounts shown in the table include the unvested values, as of the end of fiscal year 2018, of unvested stock options2020, that would immediately vest and be exercisable during the period endingearlier of four years after termination.termination or the 10-year term date of the grant.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, of the Company, then the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and any shares of Common Stock deliveredunder such grants will be automatically forfeited.
Retirement or Termination without Cause
The stock option agreements under the 2004Company’s 2010 and 2010 Equity Incentive Plans2019 EIPs for annual awards generally provide that if a participant satisfies a minimum age and years of service requirement and the participant’s employment is terminated by reason of retirement or termination without cause, stock
options granted more than six months prior to termination will continue to vest and may be exercised during the period ending four years after termination, provided the 10-year term of the grant has not expired. Erik Nordstrom, and Peter Nordstrom and Kenneth Worzel qualify for this continued vesting as they have reached the minimum retirement age of 55 with at least 10 years of service. The stock option grant on June 7, 2016, under which Erik Nordstrom and Peter Nordstrom each received options to purchase 10,838 shares, does not provide for this continued vesting upon retirement or termination.
The closing price of Common Stockamounts shown in the table include the unvested values, as of the end of the fiscal year 2018 was lower than the exercise prices of the unvested stock options2020, that would continue to vest and be exercisable during the earlier of four years after termination or the 10-year term date of the grant. Therefore, no amounts are included in the table for Erik Nordstrom and Peter Nordstrom.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, of the Company, then the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and any shares of Common Stock deliveredunder such grants will be automatically forfeited.
Qualifying Termination Following a Change in Control
The Named Executive OfficersNEOs are not entitled to any payment or accelerated benefit upon a change in control with respect to their awards. However, under the 2010 Equity Incentive Plan,and 2019 EIPs, a Named Executive OfficerNEO will generally be entitled to accelerated vesting if the executive experiences a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in controlcontrol of the Company, unless the Compensation Committee actsCPCC has acted to prevent accelerationcause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction, or the award is of a type which would continue in effect notwithstanding the occurrence of the change in control. Generally, a change in control occurs upon:upon:
the merger or consolidation of the Company with or into another entity;
the sale, transfer or other disposition of all or substantially all the Company’s assets;
a change in composition of 50% or more of the Board; or
any transaction as a result of which any person is the “beneficial owner” of securities of the Company representing at least 30% of the total voting power of the Company’s outstanding voting securities.
The amounts shown in the table include the unvested values, as of the end of fiscal year 2018, of unvested stock options2020, that would immediately vest and be exercisable if the Named Executive OfficersNEOs experienced a qualifying termination within 12 months following a change in control of the Company and the CommitteeCPCC did not act to prevent accelerationcause the NEOs to receive, on account of the awards.

56 NORDSTROM, INC. - 2019 Proxy Statement  award, cash or other property being paid to shareholders in the change in control transaction.


Performance Share Units
Death or Disability
The performance share unit2019 PSU award agreement under the 2010 Equity Incentive PlanEIP provides that if a participant’s employment is terminated before the end of a performance cycle by reason of death or disability, the participant, or participant’s beneficiary, will be entitled to a prorated payment,number of PSUs will immediately vest based on target performance and the periodnumber of time the participant worked during the performance cycle, with respect to any performance share units granted more than sixfull months prior to termination that were earnedemployed during the performance cycle.
NORDSTROM, INC. - 2021 Proxy Statement 54

The 20172019 grant has time remaining in its three-year performance cycle. IfOne-third of the PSUs are earned on the last day of the one-year performance cycle, February 1, 2020, if performance criteria have been met, and two-thirds of the units are earned on the last day of the three-year performance cycle, January 29, 2022, if performance criteria have been met. The 2019 PSUs vest when the results have been certified by the CPCC at the end of the three-year performance cycle, January 29, 2022. For the performance cycle forthat ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant had ended as of the close of fiscal year 2018, 50% of the number granted would have been earned. Therefore, thehas time remaining in its three-year performance cycle. The amounts included in the table are based on the remaining outstanding 2019 PSUs and a payout at 50%100% (target) of the prorated number.number based on termination on the last day of the fiscal year.
If, during the term of any outstanding performance cycle, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company's confidential or proprietary information, of the Company, then all outstanding vested but not settledunvested and unsettled PSUs and any unvested portions of the performance share unit awardsCommon Stock delivered on vesting under such grants will be automatically forfeited.
Retirement or Termination without Cause
The performance share unit2019 PSU award agreement under the 2010 Equity Incentive PlanEIP provides that if a participant satisfies a minimum age and years of service requirement and the participant’s employment is terminated before the end of the performance cycle by reason of retirement or termination without cause, the participant will be entitled to a prorated payment,number of PSUs based on the periodnumber of time the participant workedfull months employed during the performance cycle, with respect to any performance share unitsPSUs granted more than six months prior to termination that were earned during the performance cycle. Both Erik Nordstrom, and Peter Nordstrom and Kenneth Worzel qualify for this prorated payment upon retirement as of the end of the fiscal year.
The 20172019 grant has time remaining in its three-year performance cycle. One-third of the PSUs are earned on the last day of the one-year performance cycle, February 1, 2020, if performance criteria have been met, and two-thirds of the units are earned on the last day of the three-year performance cycle, January 29, 2022, if performance criteria have been met. The 2019 PSUs vest when the results have been certified by the CPCC at the end of the three-year performance cycle, January 29, 2022. For the performance cycle that ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant has time remaining in its three-year performance cycle.If the performance cycle for thisthe remaining two-thirds of the grant had ended as of the close of fiscal year 2018, 50%2020, the performance payout threshold would not have been achieved and 0% of the number grantedof PSUs outstanding would have been earned. Therefore, no amounts for the amounts includedPSUs are reported in the table for Erik Nordstrom and Peter Nordstrom are based on a payout at 50% of the prorated number.table.
If, during the term of any outstanding performance cycle, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company's confidential or proprietary information, of the Company, then all outstanding vested but not settledunvested and unsettled PSUs and any unvested portions of the performance share unit awardsCommon Stock delivered on vesting under such grants will be automatically forfeited.
Qualifying Termination Following a Change in Control
The Named Executive OfficersNEOs are not entitled to any payment or accelerated benefit upon a change in control with respect to their performance share units.PSUs. However, a Named Executive OfficerNEO will generally be entitled to accelerated vesting based on the target number of outstanding PSUs if the actual performance cannot be determined, if the executive experiences a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control of the Company, unless the Compensation Committee actsCPCC has acted to prevent accelerationcause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction, or the award is of a type which would continue in effect notwithstanding the occurrence of the change in control. See the Change in ControlControl paragraph under Stock Options on page 5654 for information about when a change in control occurs.
The 20172019 grant has time remaining in its three-year performance cycle. One-third of the PSUs are earned on the last day of the one-year performance cycle, February 1, 2020, if performance criteria have been met, and two-thirds of the units are earned on the last day of the three-year performance cycle, January 29, 2022, if performance criteria have been met. The 2019 PSUs vest when the results have been certified by the CPCC at the end of the three-year performance cycle, January 29, 2022. For the performance cycle that ended on February 1, 2020, the performance payout threshold was not achieved, so one-third of the grant will not pay out. The remaining two-thirds of this grant has time remaining in its three-year performance cycle. If the performance cycle for thisthe remaining two-thirds of the grant had ended as of the close of fiscal year 2018, 50%2020, the performance payout threshold would not have been achieved and 0% of the number grantedof PSUs outstanding would have been earned. Therefore, no amounts for the amounts includedPSUs are reported in the table are based on a payout at 50% of the number granted.table.
Restricted Stock Units
Death or Disability
The restricted stock unit awardRSU agreements under the 2010 Equity Incentive PlanEIP, with the exception of the 2019 RSU agreement, provide that if a participant’s employment is terminated by reason of death or disability, restricted stock unitsRSUs granted more than six months prior to the termination event will immediately vest.
The Company’s 2019 and 2020 RSU agreement for annual awards provides that if a participant’s employment is terminated by reason of death or disability, RSUs will immediately vest. The 2019 and 2020 RSU agreement for one-time awards provides that if a participant’s employment is terminated by reason of death or disability, a prorated number of RSUs granted will immediately based on the number of full months employed.
The amounts shown in the table include the values, as of the end of fiscal year 20182020, of unvested restricted stock unitsRSUs that would immediately vest.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, of the Company, then any unvested unitsRSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
55 NORDSTROM, INC. - 2021 Proxy Statement

Retirement or Termination without Cause
The restricted stock unit awardRSU agreements for annual grants under the 2010 Equity Incentive Planand 2019 EIPs generally provide that if a participant satisfies a minimum age and years of service requirement and the participant’s employment is terminated by reason of retirement or termination without cause, restricted stock unitsRSUs granted more than six months prior to termination will continue to vest. The restricted stock unit grant on June 7, 2016, under which Erik Nordstrom and Peter Nordstrom each were awarded 11,145 units, does not provide for this continued vesting upon retirement or termination.


NORDSTROM, INC. - 2019 Proxy Statement 57



The amounts shown in the table for Erik Nordstrom, and Peter Nordstrom and Kenneth Worzel include the values, as of the end of fiscal year 2018,2020, of unvested restricted stock unitsRSUs that would continue to vest after termination. These executives qualify for this continued vesting as of the end of the fiscal year since they had each reached the minimum retirement age of 55 with at least 10 years of service.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, of the Company, then any unvested unitsRSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
Qualifying Termination Following a Change in Control
Under the 2010 Equity Incentive Plan,and 2019 EIPs, the Named Executive OfficersNEOs are not entitled to any payment or accelerated benefit upon a change in control with respect to their restricted stock units.RSUs. However, a Named Executive OfficerNEO will generally be entitled to accelerated vesting if the executive experiences a qualifying termination (termination(termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control of the Company, unless the Compensation Committee actsCPCC has acted to prevent accelerationcause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction, or the award is of a type which would continue in effect notwithstanding the occurrence of the change in control. See the Change in Control paragraph under Stock Options on page 5654 for information about when a change in control occurs.
The amounts shown include the values, as of the end of fiscal year 2018,2020, of unvested restricted stock unitsRSUs that would vest if the Named Executive OfficersNEOs experienced a qualifying termination within 12 months following a change in control of the Company and the CommitteeCPCC did not act to prevent accelerationcause the NEO to receive, on account of the awards.award, cash or other property being paid to shareholders in the change in control transaction.
(b)Vested SERP Benefit
(b) Vested SERP Benefit
The annual SERP benefit is paid upon retirement for the remaining life of the executive with a 50% survivor annuity paid to the surviving spouse or life partner for the remainder of their life after the executive’s death, as described in the Pension Benefits section beginning on page 51.50.
Death
The amounts shown are the present values of the 50% survivor annuity, payable in semi-monthlyequal installments on the Company’s regular payroll dates to the spouse or life partner of the executive, assuming the payments would begin on the date on which the executive would have attained minimum retirement age of 53, or the executive’s actual age, if older, and would continue for the remaining lifetime of the spouse or life partner. There
Disability
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be no immediateeligible for his full
retirement benefit under the SERP. The amount shown would be paid in equal installments on the Company’s regular payroll dates, assuming the payment would begin as of the benefit if the datelast day of death preceded the executive’s earliest retirement age of 53.
Disability
fiscal year 2020. No amounts are shown for Erik Nordstrom or Kenneth Worzel, the other eligible NEOs, as none ofthey have not reached the eligible Named Executive Officers have reached normal retirement age of 58, which is the earliest eligibility for the SERP disability benefit.
Retirement or Termination without Cause
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown in the table for Erik Nordstrom and Peter NordstromKenneth Worzel are the present values of their SERP benefits reduced for early commencement, payable in semi-monthly installments, assuming the payments would beginretirement, as of the last day of fiscal year 2018. These Named Executive Officersthey have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement with prior approval from the Board. If the Board approved early retirement, theyThe amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be entitled to a reduced SERP benefit,paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as described inof the Pension Benefits section on page 51.last day of fiscal year 2020.
Qualifying Termination Following a Change in Control
No benefits are paid solely due to a change in control, although a change in control triggers immediate vesting and an obligation for the Company to fully fund accrued benefits through a trust. If an executive was separated from the Company after a change in control, a deferred annuity would be payable upon the executive reaching retirement age. If the separation occurred before the executive’s retirement age of 58, the benefit would be paid as a reducedan early retirement benefit at age 53, or the executive’s actual age, if older. In this case, the requirement for Board approval of the early retirement is waived.
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown in the table for Erik Nordstrom and Peter NordstromKenneth Worzel are the present values of their SERP benefits reduced for early commencement, payable in semi-monthly installments, assuming the payments would beginretirement, as of the last day of fiscal year 2018. These Named Executive Officersthey have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement. The amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the last day of fiscal year 2020.
The Compensation CommitteeCPCC has discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct or in competitive behavior against the Company.
(c) Life Insurance Proceeds

58 NORDSTROM, INC. - 2019 Proxy Statement  


(c)Life Insurance Proceeds
The Company provides life insurance for the Named Executive OfficersNEOs of approximately 1.25 times annual base salary.
The amounts reported in the table represent the life insurance proceeds that would be payable if the Named Executive OfficersNEOs had died as of the last day of the fiscal year. The premiums paid for the Company-provided life insurance are included in column (d)(c) in the All Other Compensation in Fiscal Year 20182020 table on page 44.
NORDSTROM, INC. - 2021 Proxy Statement 56
(d)Retiree Health Care Benefit

(d) Retiree Health Care Benefit
The Company provides continued health care coverage for the eligible Named Executive OfficersNEOs if they separate from the Company after age 55 with at least 10 profit sharing years of service. These benefits include medical, behavioral health/substance abuse, vision, prescription drug and dental coverage. The Named Executive OfficersNEOs and their spouses or liferegistered domestic partners and eligible dependents would be covered under the retiree health plan, and the executive and the Company would continue to share in the cost of the insurance premium. Coverage and cost sharing would continue for the surviving spouse or liferegistered domestic partner and eligible dependents after the executive’s death. Effective November 1, 2013, the retiree health plan was closed to new entrants.
The amounts in the table for Erik Nordstrom and Peter Nordstromthe eligible NEOs are the present values of the health care cost that would be payable by the Company if they had separated on the last day of the fiscal year. Erik Nordstrom, and Peter Nordstrom and Kenneth Worzel have met the minimum retirement age of 55 with at least 10 profit sharing years of service and would be eligible for retirement. Assumptions used in determining these amounts include a discount rate of 4.33%2.73% and the RP2014PRI2012 White Collar, Fully Generational Mortality Table with projection scale MP2018.MP2020.
An executive who is terminated for cause, as determined by the Company in the exercise of its discretion in accordance with the Plan, is not eligible to receive the retiree health care benefit.
(e)Separation Benefit
(e) Separation Benefit
Under the Leadership SeparationNordstrom, Inc. Executive Severance Plan, Anne Bramman, Kenneth Worzel and Christine DeputyEdmond Mesrobian are eligible to receive benefits upon involuntary termination of employment by the Company, duenot for cause. To be eligible to job elimination. participate in the Plan upon involuntary termination, the eligible NEO must have signed a non-competition and non-solicitation agreement.
Erik Nordstrom and Peter Nordstrom are not eligible for separation benefits under the Plan. Anne Bramman has elected not to participate in the Plan. The benefits for eligible employees are based on leadership level and years of service, andparticipating employees include:
lump sum cash payment for severance: one month18 or 24 months of base salary per year of service, with a minimum of 6 months up to a maximum of 12 months.for Executive Officers, depending on their roles. This is reduced by an amount equal to the participant’s gross monthly SERP benefit multiplied by the number of months used to calculate the severance payment, if applicable;
lump sum cash payment for health coverage: the cost of the Company-paid portion of the employee’s currently elected health coverage for 12 months, unless the employee is eligible for and elects the retiree health care benefit, as described in footnote (d) above;, “Retiree Health Care Benefit”; and
six months of outplacement services.
The potentialKenneth Worzel’s estimated separation payment shown below is reduced by an amount equal to his estimated gross monthly SERP benefit multiplied by the number of months used to calculate his separation payment. No amount is included for the Company-paid portion of medical benefits as he qualifies for retiree health care benefits. No amount is included for the Company-paid portion of medical benefits for the Named Executive Officers are shown below.
Name 
Separation
Payment
($)

 
Company-Paid
Portion of
Medical Benefits
($)

 
Cost of
Outplacement
Services
($)

 
Total Separation
Benefit
($)

Erik B. Nordstrom 
 
 
 
Anne L. Bramman 387,500
 8,864
 4,200
 400,564
Peter E. Nordstrom 
 
 
 
Kenneth J. Worzel 533,333
 11,922
 4,200
 549,455
Christine F. Deputy 292,500
 11,922
 4,200
 308,622
Under the Leadership Separation Plan, the Company may provide the executive with additional separation benefits, in cash or in kind, to assist the executiveEdmond Mesrobian as he is not participating in the transition from active employee status. Company’s medical benefit plans.
To be eligible to receive any benefits under the Leadership SeparationNordstrom, Inc. Executive Severance Plan, the Named Executive OfficerNEO must sign a release in which the executive agrees, among other things, not to disclose to anyone at any time any confidential information acquired during employment with the Company, and not to publish any statement, or instigate, assist or participate in the making or publication of any statement which is disparaging or detrimental in any way to the Company, except in each case as required by applicable law.
(f)Disability Insurance Benefit
The potential separation benefits for the NEOs are shown below.
NameSeparation
Payment
($)
Company-Paid
Portion of
Medical Benefits
($)
Cost of
Outplacement
Services
($)
Total Separation
Benefit
($)
Erik B. Nordstrom— — — — 
Anne L. Bramman— — — — 
Peter E. Nordstrom— — — — 
Kenneth J. Worzel1,330,609 — 4,200 1,334,809 
Edmond Mesrobian1,550,000 — 4,200 1,554,200 
(f) Disability Insurance Benefit
The Company provides long-term disability insurance for the Named Executive Officers.NEOs. The amount reported in the table for each Named Executive OfficerNEO is the long-term disability benefit provided of up to $35,000 per month. The premiums for the Company-provided disability insurance are included in column (d)(c) in the All Other Compensation in Fiscal Year 20182020 table on page 44.44.



(g) Executive Management Bonus
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(g)Executive Management Bonus
The performance period under the Executive Management Bonus PlanEMBP is the fiscal year. Therefore, a termination event that occurred on the last day of the fiscal year would not result in any additional or accelerated benefits under this Plan. However, if an employee died, became disabled or retired (after having met certain age and years of service requirements) during the fiscal year, the Compensation CommitteeCPCC would have the sole discretion to determine what amounts, if any, an executive would remain eligible to receive as a performance-based bonus award. Any bonus award would be prorated to reflect the period of service during the fiscal year.
57 NORDSTROM, INC. - 2021 Proxy Statement

Pay Ratio Disclosure
In August 2015, the
SEC issued final rules implementing the provision of the Dodd-Frank Actrequire that requires U.S. publicly traded companies to disclose the ratio of their Principal Executive Officer’s (“PEO”) compensation to that of their median employee. For this required disclosure,Our PEO is our CEO, Erik Nordstrom, Co-President, is considered to be our Principal Executive Officer (“PEO”).Nordstrom.
For fiscal year 2018:2020:
the annual total compensation of Erik Nordstrom was $4,451,746;$5,647,670, which includes PSUs granted then subsequently cancelled as discussed on page 36 with a grant date fair value of $1,592,846; and
the estimated median of the annual total compensation of all employees of our Company, other than Erik Nordstrom, was $34,454.$26,803.
Based on this information, for 20182020 the ratio of the annual total compensation of Erik Nordstrom, our Co-PresidentChief Executive Officer and PEO, to the median of the annual compensation of all employeesemployees was 129211 to 1.
The SEC rules for identifying the median employee and calculating the pay ratio permit companies to use various methodologies and assumptions, to apply certain exclusions and to make reasonable estimates that reflect their employee population and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio that we have reported.
To identify the median employee, we used the total compensation as reported on the 20182020 W-2 for all of our U.S. employees, excluding our PEO, and the Canadian equivalent T4 for all of our Canadian employees, who were employed by us on February 2, 2019,January 30, 2021, the last day of our fiscal year. We included full-time, part-time, seasonal and temporary employees and did not annualize the compensation for our permanent full-time and part-time employees who were not employed with us for the entire fiscal year. We applied a Canadian to U.S. dollar exchange rate to the compensation elements paid in Canadian currency. Similar to other large retail companies, a significant portion of our workforce is employed on a part-time and seasonal basis. As of the end of fiscal year 2018,2020, approximately 38,00029,000 of our 67,000 55,000 employees – or 57%53% of our workforce – were either part-time or seasonal.
After identifying the median employee, we calculated annual total compensation for the median employee using the same methodology we used for determining total compensation for our Named Executive OfficersNEOs as shown in the 20182020 Summary Compensation Table on page 42.

60 NORDSTROM, INC. - 20192021 Proxy Statement 58


PROPOSAL 3ADVISORY VOTE REGARDING EXECUTIVE COMPENSATION
The Board recommends a vote FOR this proposal.
The Company is providing shareholders with an advisory (nonbinding) vote on the compensation program of our Named Executive OfficersNEOs as disclosed in this Proxy Statement. At the 2017 Annual Meeting of Shareholders, over 95% of the votes cast approved our Board’s recommendation to hold advisory votes on an annual basis.
At the 20182020 Annual Meeting of Shareholders, over 90% of the votes cast were supportive of our compensation program. The Compensation Committee recognizesIn light of this support of the compensation program for our Named Executive Officers andNEOs, the CPCC continues to apply the same pay and benefits philosophy which underlies our pay-for-performance philosophy.
Compensation Program Highlights
As described in the Compensation Discussion and AnalysisCD&A beginning on page 29, our Named Executive OfficersNEOs are rewarded when defined performance milestones are achieved and when value is created for our shareholders. Our Compensation CommitteeCPCC and Board believe that our compensation program is effective in implementing our executive compensation philosophy and establishing a solid link between compensation and shareholder interests. Highlights of our compensation program include the following:
We deliver the majority of compensation through a pay-for-performance framework where incentives are based on achieving results. At least Approximately 70% of the value of the targeted compensation package for each of our Named Executive OfficersNEOs is weighted toward pay-for-performance and variable compensation to reinforce our philosophy of compensating our executives when they and the Company are successful in ways that support shareholder interests.
Each year, the Compensation CommitteeCPCC establishes the performance-based bonus measures that focus executives on the most important Company objectives. In 20182020, Named Executive OfficersNEOs had the following measures:
Incentive Adjusted Return on Invested Capital (“Incentive Adjusted ROIC”)
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders;
Incentive Earnings Before Interest and Income Tax Expense (“Incentive EBIT”) to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom, Peter Nordstrom and Blake Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Christine Deputy each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold; and
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals. This measure was added for fiscal year 2018 for Anne Bramman, Kenneth Worzel and Christine Deputy. The individual bonus measure accounted for 33% of the total bonus opportunity for these Named Executive Officers.
The Committee referencesmeasure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders;
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold; and
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
While the CPCC considers the 50th percentile (median) of our retail peer group when assessing the Named Executive Officers’ targeted levelas a reference, there is no specific percentage of target total direct compensation (base salary + performance-based bonus + long-term incentives). The market information is considered a reference point rathertargeted by the CPCC other than policyto remain generally competitive with similarly situated peer companies. Target opportunities for reviewing competitiveness.individual pay elements vary by executive role based on scope of responsibilities and expected contributions.
We maintain meaningful executive stock ownership guidelines so that our executives’ interests, as shareholders, are aligned with our broader shareholder base.
We have an executive compensation clawback policy that applies to performance-based compensation.
Our Compensation CommitteeThe CPCC has retained and directs an independent compensation consultant.
We do not have employment agreements with our executives.
We do not provide tax gross-ups, except those related to relocation expenses when an executive must move to assume Company responsibilities.
We do not allow stock option grant repricing or backdating, nor do we grant options below 100% of fair market value.
We have a derivative and hedging policy that prohibits Directors and Executive Officers (as well as other key insiders and their immediate families) from engaging in hedging transactions with respect to any equity securities of the Company held by them.
We have restrictions on pledging of Common Stock.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role.


59 NORDSTROM, INC. - 20192021 Proxy Statement61



Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to
incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.

Shareholder Support
We are asking our shareholders to indicate their support for our Named Executive Officers’NEOs’ compensation as described in this Proxy Statement.
This proposal gives our shareholders the opportunity to express their views on the compensation of our Named Executive Officers.NEOs. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our Named Executive OfficersNEOs and the philosophy, policies and practices described in this Proxy Statement. Accordingly, we ask our shareholders to vote “FOR” the following resolution at the 20192021 Annual Meeting: “RESOLVED, that the Company’s shareholders
approve, on an advisory basis, the compensation of the Company’s Named Executive Officers,NEOs, as disclosed in the Compensation Discussion and Analysis, the compensation tables and the related narrative disclosure in this Proxy Statement.”
Our Board has adopted a policy of annual executive compensation advisory votes. As an advisory vote, this proposal is not binding on the Company. However, our Compensation CommitteeCPCC and Board value the opinions of our shareholders and will consider the outcome of the vote when making future compensation decisions regarding the Company’s Named Executive Officers.NEOs.

62 NORDSTROM, INC. - 2019 Proxy Statement  


EQUITY COMPENSATION PLANSRestricted Stock Units
Death or Disability
The followingRSU agreements under the 2010 EIP, with the exception of the 2019 RSU agreement, provide that if a participant’s employment is terminated by reason of death or disability, RSUs granted more than six months prior to the termination event will immediately vest.
The Company’s 2019 and 2020 RSU agreement for annual awards provides that if a participant’s employment is terminated by reason of death or disability, RSUs will immediately vest. The 2019 and 2020 RSU agreement for one-time awards provides that if a participant’s employment is terminated by reason of death or disability, a prorated number of RSUs granted will immediately based on the number of full months employed.
The amounts shown in the table providesinclude the values, as of the end of fiscal year 2020, of unvested RSUs that would immediately vest.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, then any unvested RSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
55 NORDSTROM, INC. - 2021 Proxy Statement

Retirement or Termination without Cause
The RSU agreements for annual grants under the 2010 and 2019 EIPs generally provide that if a participant satisfies a minimum age and years of service requirement and the participant’s employment is terminated by reason of retirement or termination without cause, RSUs granted more than six months prior to termination will continue to vest.
The amounts shown in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values, as of the end of fiscal year 2020, of unvested RSUs that would continue to vest after termination. These executives qualify for this continued vesting as of the end of the fiscal year ended February 2, 2019 about Common Stock that may be issued uponsince they had each reached the exerciseminimum retirement age of options and rights that have been55 with at least 10 years of service.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or may be granted to employees and members of the Board under alldivulges or improperly uses any of the Company’s existing equity compensation plans.confidential or proprietary information, then any unvested RSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
Qualifying Termination Following a Change in Control
Under the 2010 and 2019 EIPs, the NEOs are not entitled to any payment or accelerated benefit upon a change in control with respect to their RSUs. However, a NEO will generally be entitled to accelerated vesting if the executive experiences a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control of the Company, unless the CPCC has acted to cause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction, or the award is of a type which would continue in effect notwithstanding the occurrence of the change in control. See the Change in Control paragraph under Stock Options on page 54 for information about when a change in control occurs.
The amounts shown include the values, as of the end of fiscal year 2020, of unvested RSUs that would vest if the NEOs experienced a qualifying termination within 12 months following a change in control of the Company and the CPCC did not act to cause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction.
(b) Vested SERP Benefit
The annual SERP benefit is paid upon retirement for the remaining life of the executive with a 50% survivor annuity paid to the surviving spouse or life partner for the remainder of their life after the executive’s death, as described in the Pension Benefits section beginning on page 50.
Death
The amounts shown are the present values of the 50% survivor annuity, payable in equal installments on the Company’s regular payroll dates to the spouse or life partner of the executive, and would continue for the remaining lifetime of the spouse or life partner.
Disability
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full
retirement benefit under the SERP. The amount shown would be paid in equal installments on the Company’s regular payroll dates, assuming the payment would begin as of the last day of fiscal year 2020. No amounts are shown for Erik Nordstrom or Kenneth Worzel, the other eligible NEOs, as they have not reached the normal retirement age of 58, which is the earliest eligibility for the SERP disability benefit.
Retirement or Termination without Cause
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown for Erik Nordstrom and Kenneth Worzel are the present values of their SERP benefits for early retirement, as they have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement with prior approval from the Board. The amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the last day of fiscal year 2020.
Qualifying Termination Following a Change in Control
No benefits are paid solely due to a change in control, although a change in control triggers immediate vesting and an obligation for the Company to fully fund accrued benefits through a trust. If an executive was separated from the Company after a change in control, a deferred annuity would be payable upon the executive reaching retirement age. If the separation occurred before the executive’s retirement age of 58, the benefit would be paid as an early retirement benefit at age 53, or the executive’s actual age, if older. In this case, the requirement for Board approval of the early retirement is waived.
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown for Erik Nordstrom and Kenneth Worzel are the present values of their SERP benefits for early retirement, as they have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement. The amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the last day of fiscal year 2020.
The CPCC has discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct or in competitive behavior against the Company.
(c) Life Insurance Proceeds
The Company provides life insurance for the NEOs of approximately 1.25 times annual base salary. The amounts reported in the table represent the life insurance proceeds that would be payable if the NEOs had died as of the last day of the fiscal year. The premiums paid for the Company-provided life insurance are included in column (c) in the All Other Compensation in Fiscal Year 2020 table on page 44.
Plan Category
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(1) (#)


 
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights
(2) ($)

 
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities to be issued as reflected in column (1))
(3) (#)


 
Equity compensation plans approved by the Company’s shareholders (a)
12,581,984
(b) 
53
 14,615,907
(c) 
Equity compensation plans not approved by the Company’s shareholders (d)
8,092
 5
 
 
TOTAL12,590,076
 53
 14,615,907
 
(a)Consist of the 2004 and 2010 Equity Incentive Plans, the Employee Stock Purchase Plan and the 2002 Nonemployee Director Stock Incentive Plan. Performance share units and restricted stock units do not have an exercise price and therefore have been excluded from the weighted average exercise price calculation in column (2).
(b)Includes 43,910 of deferred Director awards and 110,631 related to deferred performance share units.
(c)Includes 12,541,502 shares from the 2010 Equity Incentive Plan, 1,814,978 shares from the Employee Stock Purchase Plan and 259,427 shares from the 2002 Nonemployee Director Stock Incentive Plan.
(d)Consist of plans created in connection with our subsidiaries.


NORDSTROM, INC. - 20192021 Proxy Statement 6356



(d) Retiree Health Care Benefit
The Company provides continued health care coverage for the eligible NEOs if they separate from the Company after age 55 with at least 10 profit sharing years of service. These benefits include medical, behavioral health/substance abuse, vision, prescription drug and dental coverage. The NEOs and their spouses or registered domestic partners and eligible dependents would be covered under the retiree health plan, and the executive and the Company would continue to share in the cost of the insurance premium. Coverage and cost sharing would continue for the surviving spouse or registered domestic partner and eligible dependents after the executive’s death. Effective November 1, 2013, the retiree health plan was closed to new entrants.
The amounts in the table for the eligible NEOs are the present values of the health care cost that would be payable by the Company if they had separated on the last day of the fiscal year. Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have met the minimum retirement age of 55 with at least 10 profit sharing years of service and would be eligible for retirement. Assumptions used in determining these amounts include a discount rate of 2.73% and the PRI2012 White Collar, Fully Generational Mortality Table with projection scale MP2020.
An executive who is terminated for cause, as determined by the Company in the exercise of its discretion in accordance with the Plan, is not eligible to receive the retiree health care benefit.
(e) Separation Benefit
Under the Nordstrom, Inc. Executive Severance Plan, Kenneth Worzel and Edmond Mesrobian are eligible to receive benefits upon involuntary termination of employment by the Company, not for cause. To be eligible to participate in the Plan upon involuntary termination, the eligible NEO must have signed a non-competition and non-solicitation agreement.
Erik Nordstrom and Peter Nordstrom are not eligible under the Plan. Anne Bramman has elected not to participate in the Plan. The benefits for eligible and participating employees include:
lump sum cash payment for severance: 18 or 24 months of base salary for Executive Officers, depending on their roles. This is reduced by an amount equal to the participant’s gross monthly SERP benefit multiplied by the number of months used to calculate the severance payment, if applicable;
lump sum cash payment for health coverage: the cost of the Company-paid portion of the employee’s currently elected health coverage for 12 months, unless the employee is eligible for the retiree health care benefit, as described in footnote (d), “Retiree Health Care Benefit”; and
six months of outplacement services.
Kenneth Worzel’s estimated separation payment shown below is reduced by an amount equal to his estimated gross monthly SERP benefit multiplied by the number of months used to calculate his separation payment. No amount is included for the Company-paid portion of medical benefits as he qualifies for retiree health care benefits. No amount is included for the Company-paid portion of medical benefits for Edmond Mesrobian as he is not participating in the Company’s medical benefit plans.
To be eligible to receive any benefits under the Nordstrom, Inc. Executive Severance Plan, the NEO must sign a release in which the executive agrees, among other things, not to disclose to anyone at any time any confidential information acquired during employment with the Company, and not to publish any statement, or instigate, assist or participate in the making or publication of any statement which is disparaging or detrimental in any way to the Company, except in each case as required by applicable law.
The potential separation benefits for the NEOs are shown below.
NameSeparation
Payment
($)
Company-Paid
Portion of
Medical Benefits
($)
Cost of
Outplacement
Services
($)
Total Separation
Benefit
($)
Erik B. Nordstrom— — — — 
Anne L. Bramman— — — — 
Peter E. Nordstrom— — — — 
Kenneth J. Worzel1,330,609 — 4,200 1,334,809 
Edmond Mesrobian1,550,000 — 4,200 1,554,200 
(f) Disability Insurance Benefit
The Company provides long-term disability insurance for the NEOs. The amount reported in the table for each NEO is the long-term disability benefit provided of up to $35,000 per month. The premiums for the Company-provided disability insurance are included in column (c) in the All Other Compensation in Fiscal Year 2020 table on page 44.

(g) Executive Management Bonus
The performance period under the EMBP is the fiscal year. Therefore, a termination event that occurred on the last day of the fiscal year would not result in any additional or accelerated benefits under this Plan. However, if an employee died, became disabled or retired (after having met certain age and years of service requirements) during the fiscal year, the CPCC would have the sole discretion to determine what amounts, if any, an executive would remain eligible to receive as a performance-based bonus award. Any bonus award would be prorated to reflect the period of service during the fiscal year.
57 NORDSTROM, INC. - 2021 Proxy Statement

Pay Ratio Disclosure
SEC rules require that U.S. publicly traded companies disclose the ratio of their Principal Executive Officer’s (“PEO”) compensation to that of their median employee. Our PEO is our CEO, Erik Nordstrom.
For fiscal year 2020:
the annual total compensation of Erik Nordstrom was $5,647,670, which includes PSUs granted then subsequently cancelled as discussed on page 36 with a grant date fair value of $1,592,846; and
the estimated median of the annual total compensation of all employees of our Company, other than Erik Nordstrom, was $26,803.
Based on this information, for 2020 the ratio of the annual total compensation of Erik Nordstrom, our Chief Executive Officer and PEO, to the median of the annual compensation of all employees was 211 to 1.
The SEC rules for identifying the median employee and calculating the pay ratio permit companies to use various methodologies and assumptions, to apply certain exclusions and to make reasonable estimates that reflect their employee population and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio that we have reported.
To identify the median employee, we used the total compensation as reported on the 2020 W-2 for all of our U.S. employees, excluding our PEO, and the Canadian equivalent T4 for all of our Canadian employees, who were employed by us on January 30, 2021, the last day of our fiscal year. We included full-time, part-time, seasonal and temporary employees and did not annualize the compensation for our permanent full-time and part-time employees who were not employed with us for the entire fiscal year. We applied a Canadian to U.S. dollar exchange rate to the compensation elements paid in Canadian currency. Similar to other large retail companies, a significant portion of our workforce is employed on a part-time and seasonal basis. As of the end of fiscal year 2020, approximately 29,000 of our 55,000 employees – or 53% of our workforce – were either part-time or seasonal.
After identifying the median employee, we calculated annual total compensation for the median employee using the same methodology we used for determining total compensation for our NEOs as shown in the 2020 Summary Compensation Table on page 42.
NORDSTROM, INC. - 2021 Proxy Statement 58

PROPOSAL 43
APPROVAL OF THE NORDSTROM, INC. 2019 EQUITY INCENTIVE PLAN
ADVISORY VOTE REGARDING EXECUTIVE COMPENSATION
The Board recommends a vote FOR this proposal.
The Company is providing shareholders with an advisory (nonbinding) vote on the compensation program of our NEOs as disclosed in this Proxy Statement. At the 2017 Annual Meeting of Shareholders, over 95% of the votes cast approved our Board’s recommendation to hold advisory votes on an annual basis.
At the 2020 Annual Meeting of Shareholders, over 90% of the votes cast were supportive of our compensation program. In light of this support of the compensation program for our NEOs, the CPCC continues to apply the same pay and benefits philosophy which underlies our pay-for-performance philosophy.
Compensation Program Highlights
As described in the CD&A beginning on page 29, our NEOs are being askedrewarded when defined performance milestones are achieved and when value is created for our shareholders. Our CPCC and Board believe that our compensation program is effective in implementing our executive compensation philosophy and establishing a solid link between compensation and shareholder interests. Highlights of our compensation program include the following:
We deliver the majority of compensation through a pay-for-performance framework where incentives are based on achieving results. Approximately 70% of the value of the targeted compensation package for each of our NEOs is weighted toward pay-for-performance and variable compensation to reinforce our philosophy of compensating our executives when they and the Company are successful in ways that support shareholder interests.
Each year, the CPCC establishes the performance-based bonus measures that focus executives on the most important Company objectives. In 2020, NEOs had the following measures:
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders;
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold; and
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
While the CPCC considers the 50th percentile (median) of our peer group as a reference, there is no specific percentage of target total direct compensation targeted by the CPCC other than to remain generally competitive with similarly situated peer companies. Target opportunities for individual pay elements vary by executive role based on scope of responsibilities and expected contributions.
We maintain meaningful executive stock ownership guidelines so that our executives’ interests, as shareholders, are aligned with our broader shareholder base.
We have an executive compensation clawback policy that applies to performance-based compensation.
The CPCC has retained and directs an independent compensation consultant.
We do not have employment agreements with our executives.
We do not provide tax gross-ups, except those related to relocation expenses when an executive must move to assume Company responsibilities.
We do not allow stock option grant repricing or backdating, nor do we grant options below 100% of fair market value.
We have a derivative and hedging policy that prohibits Directors and Executive Officers (as well as other key insiders and their immediate families) from engaging in hedging transactions with respect to any equity securities of the Company held by them.
We have restrictions on pledging of Common Stock.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role.
59 NORDSTROM, INC. - 2021 Proxy Statement

Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to
incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.

Shareholder Support
We are asking our shareholders to indicate their support for our NEOs’ compensation as described in this Proxy Statement.
This proposal gives our shareholders the opportunity to express their views on the compensation of our NEOs. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this Proxy Statement. Accordingly, we ask our shareholders to vote “FOR” the following resolution at the 2021 Annual Meeting: “RESOLVED, that the Company’s shareholders
approve, on a proposal to approvean advisory basis, the adoptioncompensation of the Nordstrom, Inc. 2019 Equity Incentive Plan (the “2019 Plan”). The 2019 Plan is intended to be a successor to the existing 2010 plan (the “2010 Equity Incentive Plan”) for employees, which expires in 2020, and the existing 2002 Nonemployee Director Stock Incentive Plan for directors (“2002 Director Plan” and together with the 2010 Equity Incentive Plan, “Prior Plans”). If the 2019 Plan is approved by the shareholders, no future grants will be made under the Prior Plans.
The Company has granted equity awards to its employees and directors under Nordstrom equity compensation plans since 1977. All of these plans, with the exception of the Prior Plans, have expired. The Company wishes to replace the Prior Plans to ensure that the Company has sufficient shares available to continue its long-held approach to pay for performance through granting equity to its employees and nonemployee directors, and to incorporate terms for future grants that reflect current best practices in executive compensation. The Company’s pay for performance philosophy is describedNEOs, as disclosed in the Compensation Discussion and Analysis, beginningthe compensation tables and the related narrative disclosure in this Proxy Statement.”
Our Board has adopted a policy of annual executive compensation advisory votes. As an advisory vote, this proposal is not binding on page 29.
The 2019 Plan was approved by the Company. However, our CPCC and Board on February 27, 2019value the opinions of our shareholders and will become effective upon its adoption byconsider the shareholders.

The termsoutcome of the 2019 Plan will:
reserve for issuance by the Company 9,500,000 shares;
require each share issued as part of a full-value award, such as a grant of unrestricted shares, restricted shares, restricted stock units or performance share units, and dividend equivalents to count as 1.6 shares for purposes of determining shares remaining available for grant. Under the 2010 Equity Incentive Plan, full-value awards were counted as 1.6 shares, while under the 2002 Director Plan such awards were counted as 1 share;
prohibit liberal share recycling as shares not issued as a result of the net settlement of an outstanding stock appreciation right or stock option; shares used to pay the exercise price or withholding taxes related to an outstanding award; or shares repurchased on the open market with the proceeds of a stock option exercise price will not be returned to the 2019 Plan;
provide for “double trigger” rather than “single trigger” accelerated vesting, meaning awards will be accelerated as the result of a change in control where the participant’s employment is involuntarily terminated or the participant terminates for “good reason” within 12 months following a change of control and with respect to performance-based awards allow for acceleration of vesting at target if actual performance cannot be determined upon a qualifying termination;
establish one year as the minimum period for vesting of all awards, provided that the Compensation Committee (“Committee”) may grant awards that vest in less than one year if the total number of such shares does not exceed 5% of the available shares authorized for issuance under the 2019 Plan. Under the 2010 Equity Incentive Plan, this 5% limit applied only to grants of Unrestricted Shares;
prohibit the issuance of dividends or dividend equivalents on stock options and stock appreciation rights and prohibit delivery of dividends or dividend equivalents on all other types of awards unless such awards are earned and vested;
subject all awards tovote when making future compensation decisions regarding the Company’s clawback policy as described on page 40; andNEOs.
prohibit the transfer of awards, except in the context of death or otherwise required by law, or as approved by the Committee.
Shares Available under Plans
We currently have shares available for grant under two existing equity incentive plans:
2002 Nonemployee Director Stock Incentive Plan with 257,883 shares available as of our record date, March 15, 2019. Once the 2019 Plan is approved by the shareholders, the 2002 Director Plan will be terminated, and therefore no additional shares will be granted from it.
2010 Equity Incentive Plan with 9,103,009 shares available as of March 15, 2019. Once the 2019 Plan is approved by the shareholders, the 2010 Equity Incentive Plan will be terminated, and therefore no additional shares will be granted from it.
2019 Equity Incentive Plan Upon approval by the shareholders, the 2019 Plan will have 9,500,000 shares available for grant, plus the additional shares that may become available if outstanding awards are forfeited under the 2010 Equity Incentive Plan and the expired 2004 Equity Incentive Plan.

64 NORDSTROM, INC. - 2019 Proxy Statement  


The following table shows information regarding outstanding options and full-value awards as of March 15, 2019 under the Company’s 2002 Nonemployee Director Stock Incentive Plan, 2004 Equity Incentive Plan and the 2010 Equity Incentive Plan.
Outstanding Options
(#)

Weighted Average Exercise Price
($)

Weighted Average Remaining Years of Contractual Life
(#)

 
Unvested Full Value Awards 
(#)
9,245,495
52.34
4.93
 4,606,812*
*Includes restricted stock units and performance share units granted at maximum. Each outstanding full value award reduces the shares available for grant under the 2010 Equity Incentive Plan by 1.6 shares. 
Summary of 2019 Plan Terms
The following is a summary of the 2019 Plan, a complete copy of which has been filed with the Securities and Exchange Commission as Appendix B to this Proxy Statement and is also available on the SEC’s website at www.sec.gov. This summary is qualified in its entirety by the actual terms of the 2019 Plan, which are incorporated herein by this reference.
Participants
Eligible participants include the Company’s and its subsidiaries’:
employees; and
nonemployee directors
The 2019 Plan is broad enough to cover all of the Company’s and its subsidiaries’ approximately 67,000 full- or part-time employees and nonemployee directors. The Company currently grants equity to approximately 650 eligible employees, approximately 480 of our highest-performing sales people and its nonemployee directors.
Purpose
The purpose of the 2019 Plan is to promote the long-term success of the Company and its subsidiaries and the creation of shareholder value by:
motivating participants to focus on the Company’s critical long-range objectives;
encouraging the attraction and retention of employees and nonemployee directors; and
aligning participant and shareholder interests through stock ownership.

Administration
The Committee will administer the 2019 Plan, except that it may also appoint a secondary Board committee or one or more senior executive officers to administer the 2019 Plan with respect to employees who are not considered executive officers under Section 16 of the Securities Exchange Act of 1934, as amended (“Exchange Act”). The Committee may delegate certain day-to-day administrative duties under the 2019 Plan to the Company’s Compensation department (or similar department).
Awards
The types of awards that may be made under the 2019 Plan are:
options to purchase shares of Common Stock;
stock appreciation rights;
unrestricted shares of Common Stock;
restricted shares of Common Stock;
restricted stock units; and
performance share units.

Share Limits and Vesting Requirements
The limit on the number of shares of Common Stock that may be delivered under the Plan through the issuance of any type of award may not exceed (i) 9,500,000 plus (ii) any shares currently underlying awards outstanding under the 2010 Equity Incentive Plan and 2004 Equity Incentive Plan but which are forfeited or which expire without exercise during the term of the 2019 Plan.


NORDSTROM, INC. - 2019 Proxy Statement 65



The maximum number of shares that will be available for grant under the 2019 Plan is subject to reduction by 1.6 shares for each share that is delivered in settlement of an award of unrestricted shares, restricted shares, restricted stock units, performance share units, dividends and dividend equivalents. When a share is delivered in settlement of one of the foregoing types of awards, the maximum is reduced by 1.6 shares and when a share is delivered in settlement of an option or a stock appreciation right, the maximum is reduced by one share.
All awards granted under the Plan shall vest no earlier than the first anniversary of the date of grant provided that up to 5% of the authorized shares under the Plan (including all unrestricted shares of Common Stock) may be granted without this limit.
The 2019 Plan sets forth limits on the number of shares of Common Stock that may be granted pursuant to an award to any participant in a single fiscal year, as follows. No participant may receive:
options to purchase more than 500,000 shares of Common Stock;
more than 500,000 stock appreciation rights;
more than 100,000 unrestricted shares of Common Stock;
more than 500,000 restricted shares of Common Stock;
more than 500,000 restricted stock units; or
more than 500,000 performance share units.

Options
Options may be incentive stock options that qualify for favorable tax treatment for the optionee under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) or nonqualified stock options not designed to qualify for favorable tax treatment. Incentive stock options may only be granted to employees. Each option agreement will specify the type of option and the date or event when all or any installment of the option is to become exercisable. The Company has historically granted nonqualified options with a four-year vesting period. The option agreement will also specify the term of the option, provided, however, that the term of an option will in no event exceed 10 years from the date of grant. An option agreement may provide for accelerated exercisability in the event of the optionee’s death, disability or retirement and may provide for expiration prior to the end of its term in the event of the termination of the optionee’s service.
The exercise price of an option may not be less than 100% of the fair market value of Common Stock on the date of grant. Options may not be repriced.
At the Committee’s discretion, the exercise price of an option may be paid with:
cash;
cash equivalents;
the delivery of outstanding shares of Common Stock;
the cashless exercise method through a broker;
a net exercise method through a broker; or
a combination of these methods.
No dividend or dividend equivalent rights shall accrue or be paid with respect to options. 

Stock Appreciation Rights
Stock appreciation rights may be granted with such terms and conditions as may be determined by the Committee provided, however, that the term of a stock appreciation right may not exceed 10 years from the date of grant. Each grant will be evidenced by a stock appreciation rights agreement, which will specify the number of shares of Common Stock to which the right pertains. The agreement will also specify the exercise price, the date when all or any installment is to become exercisable and the term of the stock appreciation right. The agreement may provide for accelerated exercisability in the event of the optionee’s death, disability or retirement and may provide for expiration prior to the end of its term in the event of the termination of the optionee’s service. Stock appreciation rights may be awarded in combination with options, and such an award may provide that the stock appreciation rights will not be exercisable unless the related options are forfeited.
At the Committee’s discretion, upon exercise of a stock appreciation right, the participant (or person having the right to exercise the right after his or her death) will receive:
cash;
shares of Common Stock; or
any combination of both.

66 NORDSTROM, INC. - 2019 Proxy Statement  


The exercise price of a stock appreciation right may not be less than 100% of the fair market value of Common Stock on the date of grant. Stock appreciation rights may not be repriced.

No dividend or dividend equivalent rights shall accrue or be paid with respect to stock appreciation rights.
Unrestricted Shares
Shares not subject to vesting may be awarded for such consideration, consisting of any tangible or intangible property or benefit to the Company, including services performed and contracts for services, as the Committee may determine.  
Restricted Shares

Restricted shares may be granted with such terms and conditions as the Committee may determine. These restricted shares may be awarded for such consideration, consisting of any tangible or intangible property or benefit to the Company, including services performed and contracts for services, as the Committee may determine.
Each award of restricted shares will be subject to vesting. Vesting will occur, in full or in installments, upon satisfaction of the conditions specified in the restricted share agreement. The Committee may include among such conditions the requirement that the performance of the Company or a business unit of the Company equal or exceed a target determined in advance by the Committee. A restricted share agreement may provide for accelerated vesting in the event of the recipient’s death, disability or retirement and may provide for expiration prior to the end of its term in the event of the termination of the recipient’s service.
The holders of restricted shares will have the voting, dividend and other rights as set forth in their restricted share agreement, and may have the same voting, dividend or other rights as the Company’s other shareholders provided that any dividends accrued on restricted shares shall be held in escrow by the Company and shall only be paid if and when restricted shares vest, in cash or in shares of unrestricted Common Stock having a fair market value equal to the amount of such dividends. Common Stock distributed to the holder of restricted shares on account of a stock split or stock dividend will be subject to restrictions and risk of forfeiture to the same extent as the restricted shares with respect to which such Common Stock has been distributed.
Restricted Stock Units
Death or Disability
Restricted stock units may be grantedThe RSU agreements under the 2010 EIP, with such terms and conditions as the Committee may determine. Each award of restricted stock units will be subject to vesting. Vesting will occur, in full or in installments, upon satisfactionexception of the conditions specified2019 RSU agreement, provide that if a participant’s employment is terminated by reason of death or disability, RSUs granted more than six months prior to the termination event will immediately vest.
The Company’s 2019 and 2020 RSU agreement for annual awards provides that if a participant’s employment is terminated by reason of death or disability, RSUs will immediately vest. The 2019 and 2020 RSU agreement for one-time awards provides that if a participant’s employment is terminated by reason of death or disability, a prorated number of RSUs granted will immediately based on the number of full months employed.
The amounts shown in the restricted stock unit agreement. The Committee maytable include among such conditions the requirementvalues, as of the end of fiscal year 2020, of unvested RSUs that would immediately vest.
If, during the performanceterm of any outstanding grant, the executive engages in any business competitive with the Company or a business unitdivulges or improperly uses any of the Company exceedCompany’s confidential or proprietary information, then any unvested RSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
55 NORDSTROM, INC. - 2021 Proxy Statement

Retirement or Termination without Cause
The RSU agreements for annual grants under the 2010 and 2019 EIPs generally provide that if a target determined in advanceparticipant satisfies a minimum age and years of service requirement and the participant’s employment is terminated by the Committee. A restricted stock unit agreement may provide for accelerated vestingreason of retirement or termination without cause, RSUs granted more than six months prior to termination will continue to vest.
The amounts shown in the eventtable for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values, as of the recipient’s death, disability or retirement and may provide for expiration prior to the end of its term in the eventfiscal year 2020, of the termination of the recipient’s service.
The holders of restricted stock units will not have voting or dividend rights. Prior to settlement or forfeiture, any restricted stock unit may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right will entitle the holder to be paid an amount in cash or stock equal to the dividendsunvested RSUs that would have been paid if the restricted stock units had been issued and outstanding shares of Common Stockcontinue to vest after termination. These executives qualify for this continued vesting as of the record date for the payment of dividends, subject to applicable withholding taxes, if and when the restricted stock units vest.
At the discretion of the Committee, settlement of vested units may be made in the form of:
cash;
shares of Common Stock (unrestricted or restricted shares); or
any combination of both.
Performance Share Units
Performance share units may be granted with such terms and conditions as the Committee may determine. Performance share units are designated in shares of Common Stock.
Each award of performance share units will be subject to vesting. Vesting will occur, in full or in installments, upon satisfaction of the conditions specified in the performance share unit agreement. The Committee may include among such conditions the requirement that the performance of the Company or a business unit of the Company exceed a target determined in advance by the Committee. A performance share unit agreement may provide for accelerated vesting in the event of the recipient’s death, disability or retirement and may provide for expiration prior to the end of the performance periodfiscal year since they had each reached the minimum retirement age of 55 with at least 10 years of service.
If, during the term of any outstanding grant, the executive engages in any business competitive with the Company or divulges or improperly uses any of the Company’s confidential or proprietary information, then any unvested RSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited.
Qualifying Termination Following a Change in Control
Under the 2010 and 2019 EIPs, the NEOs are not entitled to any payment or accelerated benefit upon a change in control with respect to their RSUs. However, a NEO will generally be entitled to accelerated vesting if the executive experiences a qualifying termination (termination by the Company without cause or termination by the executive for good reason) within 12 months following a change in control of the Company, unless the CPCC has acted to cause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the eventchange in control transaction, or the award is of a type which would continue in effect notwithstanding the occurrence of the terminationchange in control. See the Change in Control paragraph under Stock Options on page 54 for information about when a change in control occurs.
The amounts shown include the values, as of the recipient’s service.end of fiscal year 2020, of unvested RSUs that would vest if the NEOs experienced a qualifying termination within 12 months following a change in control of the Company and the CPCC did not act to cause the NEO to receive, on account of the award, cash or other property being paid to shareholders in the change in control transaction.
(b) Vested SERP Benefit
The annual SERP benefit is paid upon retirement for the remaining life of the executive with a 50% survivor annuity paid to the surviving spouse or life partner for the remainder of their life after the executive’s death, as described in the Pension Benefits section beginning on page 50.
Death
The amounts shown are the present values of the 50% survivor annuity, payable in equal installments on the Company’s regular payroll dates to the spouse or life partner of the executive, and would continue for the remaining lifetime of the spouse or life partner.
Disability
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full


retirement benefit under the SERP. The amount shown would be paid in equal installments on the Company’s regular payroll dates, assuming the payment would begin as of the last day of fiscal year 2020. No amounts are shown for Erik Nordstrom or Kenneth Worzel, the other eligible NEOs, as they have not reached the normal retirement age of 58, which is the earliest eligibility for the SERP disability benefit.
Retirement or Termination without Cause
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown for Erik Nordstrom and Kenneth Worzel are the present values of their SERP benefits for early retirement, as they have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement with prior approval from the Board. The amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the last day of fiscal year 2020.
Qualifying Termination Following a Change in Control
No benefits are paid solely due to a change in control, although a change in control triggers immediate vesting and an obligation for the Company to fully fund accrued benefits through a trust. If an executive was separated from the Company after a change in control, a deferred annuity would be payable upon the executive reaching retirement age. If the separation occurred before the executive’s retirement age of 58, the benefit would be paid as an early retirement benefit at age 53, or the executive’s actual age, if older. In this case, the requirement for Board approval of the early retirement is waived.
The amount shown for Peter Nordstrom is the present value of his SERP benefit as he has met the minimum age of 58 with at least 10 years of service and would be eligible for his full retirement benefit under the SERP. The amounts shown for Erik Nordstrom and Kenneth Worzel are the present values of their SERP benefits for early retirement, as they have met the minimum early retirement age of 53 with at least 10 years of service and would be eligible for early retirement. The amounts payable to Peter Nordstrom, Erik Nordstrom and Kenneth Worzel would be paid in equal installments on the Company’s regular payroll dates, assuming the payments would begin as of the last day of fiscal year 2020.
The CPCC has discretion to discontinue payment of benefits under the SERP if the retired executive is found to have engaged in misconduct or in competitive behavior against the Company.
(c) Life Insurance Proceeds
The Company provides life insurance for the NEOs of approximately 1.25 times annual base salary. The amounts reported in the table represent the life insurance proceeds that would be payable if the NEOs had died as of the last day of the fiscal year. The premiums paid for the Company-provided life insurance are included in column (c) in the All Other Compensation in Fiscal Year 2020 table on page 44.
NORDSTROM, INC. - 20192021 Proxy Statement 6756



(d) Retiree Health Care Benefit
A holderThe Company provides continued health care coverage for the eligible NEOs if they separate from the Company after age 55 with at least 10 profit sharing years of performanceservice. These benefits include medical, behavioral health/substance abuse, vision, prescription drug and dental coverage. The NEOs and their spouses or registered domestic partners and eligible dependents would be covered under the retiree health plan, and the executive and the Company would continue to share units willin the cost of the insurance premium. Coverage and cost sharing would continue for the surviving spouse or registered domestic partner and eligible dependents after the executive’s death. Effective November 1, 2013, the retiree health plan was closed to new entrants.
The amounts in the table for the eligible NEOs are the present values of the health care cost that would be payable by the Company if they had separated on the last day of the fiscal year. Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have no rights to dividendsmet the minimum retirement age of 55 with at least 10 profit sharing years of service and willwould be eligible for retirement. Assumptions used in determining these amounts include a discount rate of 2.73% and the PRI2012 White Collar, Fully Generational Mortality Table with projection scale MP2020.
An executive who is terminated for cause, as determined by the Company in the exercise of its discretion in accordance with the Plan, is not be entitled to vote such units. Prior to settlement or forfeiture, any performance share unit may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right will entitle the holdereligible to receive ifthe retiree health care benefit.
(e) Separation Benefit
Under the Nordstrom, Inc. Executive Severance Plan, Kenneth Worzel and whenEdmond Mesrobian are eligible to receive benefits upon involuntary termination of employment by the applicable performance share units vest,Company, not for cause. To be eligible to participate in the Plan upon involuntary termination, the eligible NEO must have signed a non-competition and non-solicitation agreement.
Erik Nordstrom and Peter Nordstrom are not eligible under the Plan. Anne Bramman has elected not to participate in the Plan. The benefits for eligible and participating employees include:
lump sum cash payment for severance: 18 or 24 months of base salary for Executive Officers, depending on their roles. This is reduced by an amount in cash or stock equal to the dividendsparticipant’s gross monthly SERP benefit multiplied by the number of months used to calculate the severance payment, if applicable;
lump sum cash payment for health coverage: the cost of the Company-paid portion of the employee’s currently elected health coverage for 12 months, unless the employee is eligible for the retiree health care benefit, as described in footnote (d), “Retiree Health Care Benefit”; and
six months of outplacement services.
Kenneth Worzel’s estimated separation payment shown below is reduced by an amount equal to his estimated gross monthly SERP benefit multiplied by the number of months used to calculate his separation payment. No amount is included for the Company-paid portion of medical benefits as he qualifies for retiree health care benefits. No amount is included for the Company-paid portion of medical benefits for Edmond Mesrobian as he is not participating in the Company’s medical benefit plans.
To be eligible to receive any benefits under the Nordstrom, Inc. Executive Severance Plan, the NEO must sign a release in which the executive agrees, among other things, not to disclose to anyone at any time any confidential information acquired during employment with the Company, and not to publish any statement, or instigate, assist or participate in the making or publication of any statement which is disparaging or detrimental in any way to the Company, except in each case as required by applicable law.
The potential separation benefits for the NEOs are shown below.
NameSeparation
Payment
($)
Company-Paid
Portion of
Medical Benefits
($)
Cost of
Outplacement
Services
($)
Total Separation
Benefit
($)
Erik B. Nordstrom— — — — 
Anne L. Bramman— — — — 
Peter E. Nordstrom— — — — 
Kenneth J. Worzel1,330,609 — 4,200 1,334,809 
Edmond Mesrobian1,550,000 — 4,200 1,554,200 
(f) Disability Insurance Benefit
The Company provides long-term disability insurance for the NEOs. The amount reported in the table for each NEO is the long-term disability benefit provided of up to $35,000 per month. The premiums for the Company-provided disability insurance are included in column (c) in the All Other Compensation in Fiscal Year 2020 table on page 44.

(g) Executive Management Bonus
The performance period under the EMBP is the fiscal year. Therefore, a termination event that would have been paid if the performance share units had been settled in shares of Common Stock on or before the record date for any dividends declaredoccurred on the Company’s Common Stock, subject to applicable withholding taxes.

At the discretionlast day of the Committee, settlement of vested performance share units may be made in the form of:
cash;
shares of Common Stock; or
any combination of both.
Change in Control
Under the 2019 Plan the vesting and exercisability of the awards will accelerate, in whole or in part, upon (i) a “qualifying termination” within 12 months following (ii) a change in control. A “qualifying termination” means an involuntary, employer-initiated termination without cause or a voluntary termination for good reason. Upon a change in control, the Committee may also allow for a cash payment or for the assumption, substitution or exchange of any or all outstanding awards.
Federal Income Tax Consequences
The tax consequences of the 2019 Plan are complex, and the following discussion deals only with general tax principles applicable to the 2019 Plan under federal law.
Incentive stock options are options which under certain circumstances and subject to certain tax restrictions, have special tax benefits for employees under the Internal Revenue Code. Nonqualified stock options are options which do not receive such special tax treatment.
When the Committee grants an incentive stock option and when the participant exercises an incentive stock option and acquires Common Stock, the participant realizes no taxable income and the Company can claim no deduction. (However, the differences between the fair market value of the shares upon exercise and the exercise price is an item of tax preference subject to the possible application of the alternative minimum tax.) If the participant disposes of the stock before two years from grant or onefiscal year from exercise of the incentive stock option (a disqualifying disposition), any gain will be deemed compensation and taxed as ordinary income to the extent of the lesser of:
the spread between the option price and the fair market value of the stock at exercise; or
the difference between the sale price and the exercise price.
If a disqualifying disposition occurs, the Company can claim a deduction equal to the amount treated as compensation. If one- and two-year holding periods are satisfied, any gain realized when the shares are sold will be treated as capital gain, and the Company will receive no corresponding tax deduction.
When the Committee grants a nonqualified stock option, the participant realizes no taxable income and the Company can claim no deduction. On exercise of a nonqualified stock option, the participant realizes ordinary income to the extent of the spread and the Company can claim a tax deduction for the same amount.
When the Committee grants a stock appreciation right, the participant realizes no taxable income and the Company can claim no deduction. The cash or fair market value of stock received on a stock appreciation right exercise is taxed to the participant at ordinary income rates. The Company can claim a tax deduction in the same amount at such time.
Upon grant of unrestricted shares, the participant realizes ordinary income equal to the fair market value of the Common Stock on the date of grant and the Company can generally claim a tax deduction for the same amount.
Grants of restricted shares are generally not taxable to participants at the time of grant and the Company generally claims no deduction at that time. The Company receives a deduction and the participant recognizes taxable income equal to the fair market value of the stock at the time the restrictions lapse (i.e., at the time the restricted shares vest), unless the participant elects, within thirty days of notification of the award, to recognize the income on the award date, in accordance with Code Section 83(b) (an “83(b) election”). If the participant makes an 83(b) election, the Company receives a corresponding deduction at the time of grant. Any dividends received on restricted shares prior to the date the participant recognizes income on the stock are taxable compensation income when received and the Company is entitled to a corresponding tax deduction at such time.
The grant of restricted stock units and performance share units generally doeswould not result in taxable incomeany additional or accelerated benefits under this Plan. However, if an employee died, became disabled or retired (after having met certain age and years of service requirements) during the fiscal year, the CPCC would have the sole discretion to determine what amounts, if any, an executive would remain eligible to receive as a performance-based bonus award. Any bonus award would be prorated to reflect the participant. Upon vesting,period of service during the number of shares issued or cash paid is treated as ordinary income, and the Company is entitled to a corresponding tax deduction at such time.fiscal year.

6857 NORDSTROM, INC. - 20192021 Proxy Statement


Pay Ratio Disclosure
New Plan Benefits
SEC rules require that U.S. publicly traded companies disclose the ratio of their Principal Executive Officer’s (“PEO”) compensation to that of their median employee. Our PEO is our CEO, Erik Nordstrom.
For fiscal year 2020:
the annual total compensation of Erik Nordstrom was $5,647,670, which includes PSUs granted then subsequently cancelled as discussed on page 36 with a grant date fair value of $1,592,846; and
the estimated median of the annual total compensation of all employees of our Company, other than Erik Nordstrom, was $26,803.
Based on this information, for 2020 the ratio of the annual total compensation of Erik Nordstrom, our Chief Executive Officer and PEO, to the median of the annual compensation of all employees was 211 to 1.
The Committee has full discretionSEC rules for identifying the median employee and calculating the pay ratio permit companies to determineuse various methodologies and assumptions, to apply certain exclusions and to make reasonable estimates that reflect their employee population and compensation practices. As a result, the number and amount of options, stock appreciation rights, unrestricted and restricted shares, and restricted share units and performance share units topay ratio reported by other companies may not be granted to participants, subjectcomparable to the pay ratio that we have reported.
To identify the median employee, we used the total compensation as reported on the 2020 W-2 for all of our U.S. employees, excluding our PEO, and the Canadian equivalent T4 for all of our Canadian employees, who were employed by us on January 30, 2021, the last day of our fiscal year. We included full-time, part-time, seasonal and temporary employees and did not annualize the compensation for our permanent full-time and part-time employees who were not employed with us for the entire fiscal year. We applied a Canadian to U.S. dollar exchange rate to the compensation elements paid in Canadian currency. Similar to other large retail companies, a significant portion of our workforce is employed on a part-time and seasonal basis. As of the end of fiscal year 2020, approximately 29,000 of our 55,000 employees – or 53% of our workforce – were either part-time or seasonal.
After identifying the median employee, we calculated annual limitations describedtotal compensation for the median employee using the same methodology we used for determining total compensation for our NEOs as shown in the 2020 Summary Compensation Table on page 66. Therefore, the benefits and amounts that will be received by each of the Named Executive Officers, the executive officers as a group, nonemployee directors and all other employees under the 2019 Plan are not presently determinable. The fair market value as of the close of trading on March 15, 2019 was $43.74 per share.42.
Term, Termination and Amendment
The 2019 Plan will remain in effect for a period of 10 years unless earlier terminated by the Board. The Board may, at any time and for any reason, amend the 2019 Plan. An amendment of the Plan will be subject to the approval of the Company’s shareholders to the extent required by applicable laws, regulations or rules.


NORDSTROM, INC. - 20192021 Proxy Statement 6958



PROPOSAL 3ADVISORY VOTE REGARDING EXECUTIVE COMPENSATION
The Board recommends a vote FOR this proposal.
The Company is providing shareholders with an advisory (nonbinding) vote on the compensation program of our NEOs as disclosed in this Proxy Statement. At the 2017 Annual Meeting of Shareholders, over 95% of the votes cast approved our Board’s recommendation to hold advisory votes on an annual basis.
At the 2020 Annual Meeting of Shareholders, over 90% of the votes cast were supportive of our compensation program. In light of this support of the compensation program for our NEOs, the CPCC continues to apply the same pay and benefits philosophy which underlies our pay-for-performance philosophy.
Compensation Program Highlights
As described in the CD&A beginning on page 29, our NEOs are rewarded when defined performance milestones are achieved and when value is created for our shareholders. Our CPCC and Board believe that our compensation program is effective in implementing our executive compensation philosophy and establishing a solid link between compensation and shareholder interests. Highlights of our compensation program include the following:
We deliver the majority of compensation through a pay-for-performance framework where incentives are based on achieving results. Approximately 70% of the value of the targeted compensation package for each of our NEOs is weighted toward pay-for-performance and variable compensation to reinforce our philosophy of compensating our executives when they and the Company are successful in ways that support shareholder interests.
Each year, the CPCC establishes the performance-based bonus measures that focus executives on the most important Company objectives. In 2020, NEOs had the following measures:
Incentive Adjusted ROIC to ensure our overall performance aligns directly with shareholder returns over the long term. The measure is expressed as a threshold that must be met before any payout can be made on Incentive Adjusted EBIT results to ensure our executives are rewarded only after earnings generate meaningful returns for our shareholders;
Incentive Adjusted EBIT to emphasize the importance of earnings and its role in driving shareholder value. Erik Nordstrom and Peter Nordstrom each had this performance measure weighed at 100%, subject to the achievement of the Incentive Adjusted ROIC threshold. Anne Bramman, Kenneth Worzel and Edmond Mesrobian each had this performance measure weighed at 67%, again subject to the achievement of the Incentive Adjusted ROIC threshold; and
Individual Measure to enable differentiation in bonus payout opportunity based on individual contributions and execution against goals for Anne Bramman, Kenneth Worzel and Edmond Mesrobian. The individual bonus measure accounted for 33% of the total bonus opportunity for these NEOs.
While the CPCC considers the 50th percentile (median) of our peer group as a reference, there is no specific percentage of target total direct compensation targeted by the CPCC other than to remain generally competitive with similarly situated peer companies. Target opportunities for individual pay elements vary by executive role based on scope of responsibilities and expected contributions.
We maintain meaningful executive stock ownership guidelines so that our executives’ interests, as shareholders, are aligned with our broader shareholder base.
We have an executive compensation clawback policy that applies to performance-based compensation.
The CPCC has retained and directs an independent compensation consultant.
We do not have employment agreements with our executives.
We do not provide tax gross-ups, except those related to relocation expenses when an executive must move to assume Company responsibilities.
We do not allow stock option grant repricing or backdating, nor do we grant options below 100% of fair market value.
We have a derivative and hedging policy that prohibits Directors and Executive Officers (as well as other key insiders and their immediate families) from engaging in hedging transactions with respect to any equity securities of the Company held by them.
We have restrictions on pledging of Common Stock.
On March 25, 2020, the CPCC took immediate action to support cash preservation goals by reducing the base salaries of the NEOs from March 29, 2020 to October 3, 2020, as follows: Erik Nordstrom and Peter Nordstrom received no base salary, while Anne Bramman, Kenneth Worzel and Edmond Mesrobian received a 25% base salary reduction. Similarly, the salaries of all other executives at the Company were reduced by 10% to 25%, depending on role.
59 NORDSTROM, INC. - 2021 Proxy Statement

Shortly after the PSU grant was made on March 9, 2020, the Company temporarily closed stores in response to the growing COVID-19 pandemic, which meaningfully disrupted sales and operations. There was also significant uncertainty and disruption to our inventory flow, merchandising, and supply chain. Accordingly, the CPCC determined that the financial and market share goals established in February of 2020 for the PSU grant were no longer relevant or functional, and determined not to revise the goals for the 2020 PSUs. Accordingly, each of the NEOs agreed to the cancellation of their PSU award on August 18, 2020, as disclosed in the Form 8-K filed August 20, 2020. As required, the grant date fair values of the PSU grants are included in the Summary Compensation Table, on page 42. On August 18, 2020, the CPCC determined to award stock option grants in light of continued economic uncertainty, along with a desire to
incentivize executives towards optimal shareholder outcomes and recognize the executives’ critical roles in supporting the Company’s key strategies and long-term success to each of the NEOs, effective August 27, 2020, the first open trading window date after CPCC approval. Stock options reward executives for the creation of long-term shareholder value, thereby aligning the executives’ interests with those of our Company’s shareholders. Erik Nordstrom and Peter Nordstrom each received an option to purchase 245,829 shares, and Anne Bramman, Kenneth Worzel and Edmond Mesrobian received an option to purchase 281,657, 366,540 and 212,207 shares, respectively. The stock options granted on August 27, 2020 have a grant price of $14.79, the closing stock price on August 27, 2020 and vest in full on September 10, 2022.

Shareholder Support
We are asking our shareholders to indicate their support for our NEOs’ compensation as described in this Proxy Statement.
This proposal gives our shareholders the opportunity to express their views on the compensation of our NEOs. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this Proxy Statement. Accordingly, we ask our shareholders to vote “FOR” the following resolution at the 2021 Annual Meeting: “RESOLVED, that the Company’s shareholders
approve, on an advisory basis, the compensation of the Company’s NEOs, as disclosed in the Compensation Discussion and Analysis, the compensation tables and the related narrative disclosure in this Proxy Statement.”
Our Board has adopted a policy of annual executive compensation advisory votes. As an advisory vote, this proposal is not binding on the Company. However, our CPCC and Board value the opinions of our shareholders and will consider the outcome of the vote when making future compensation decisions regarding the Company’s NEOs.
EQUITY COMPENSATION PLANS
The following table provides information as of the fiscal year ended January 30, 2021 about Common Stock that may be issued upon the exercise of options and rights that have been or may be granted to employees and members of the Board under all of the Company’s existing equity compensation plans.
Plan CategoryNumber of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
(1) (#)
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights
(2) ($)
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (excluding securities to be issued as reflected in
column (1))
(3) (#)
Equity compensation plans approved by the Company’s shareholders (a)
16,255,730 (b)40 22,101,260 (c)
Equity compensation plans not approved by the Company’s shareholders (d)
1,029 — 
TOTAL16,256,759 40 22,101,260 
(a)Consist of the 2010 and 2019 EIP and the ESPP. PSUs and RSUs do not have an exercise price and therefore have been excluded from the weighted average exercise price calculation in column (2).
(b)Includes 42,030 of deferred Director awards and 79,490 related to deferred PSUs.
(c)Includes 18,326,125 shares from the 2019 EIP, and 3,775,135 shares from the ESPP.
(d)Consist of plans created in connection with our subsidiaries.
NORDSTROM, INC. - 2021 Proxy Statement 60

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Beneficial Ownership Table
The following table shows the amount of Common Stock beneficially owned (unless otherwise indicated) by holders of more than 5% of the outstanding shares of Common Stock, by our Directors, by the Named Executive Officers,NEOs, and by all Directors and Executive Officers of the Company as a group. Except as otherwise noted, all information is as of March 15, 2019.10, 2021.
Name of Beneficial OwnerAmount and Nature of
Beneficial Ownership
(#)
Percent of
Ownership
(%)
(a)Peter E. Nordstrom3,384,1022.14 %
(b)Erik B. Nordstrom3,375,9942.13 %
(c)Kenneth J. Worzel233,254*
(d)Edmond Mesrobian33,195*
(e)Anne L. Bramman44,648*
(f)Brad D. Smith50,169*
(g)Shellye L. Archambeau31,451*
(h)Bradley D. Tilden26,142*
(i)Tanya L. Domier25,421*
(j)Stacy Brown-Philpot21,973*
(k)Kirsten A. Green14,131*
(l)Glenda G. McNeal14,131*
(m)James L. Donald9,041*
(n)Mark J. Tritton9,041*
(o)Directors and Executive Officers as a group (22 persons)8,852,8395.55 %
Greater than 5% Security Holders  
(p)Bruce A. Nordstrom
   1617 Sixth Avenue
   Seattle, Washington 98101
25,241,42316.00 %
(q)Anne E. Gittinger
   1617 Sixth Avenue
   Seattle, Washington 98101
15,404,2469.76 %
(r)
FMR, LLC
245 Summer Street
Boston, Massachusetts 02210
13,656,8328.66 %
(s)Blackrock, Inc.
   55 East 52nd Street
   New York, New York 10055
10,402,1086.59 %
(t)The Vanguard Group
   100 Vanguard Boulevard
   Malvern, Pennsylvania 19355
9,665,8836.13 %
Name of Beneficial Owner 
Amount and Nature of
Beneficial Ownership
(#)

 
Percent of
Ownership
(%)

(a)
Bruce A. Nordstrom
   1617 Sixth Avenue
   Seattle, Washington 98101-1707
 25,241,278
 16.29
(b)
Anne E. Gittinger
   1617 Sixth Avenue
   Seattle, Washington 98101-1707
 15,403,689
 9.94
(c)Peter E. Nordstrom 3,389,278
 2.18
(d)Erik B. Nordstrom 3,177,793
 2.04
(e)Kenneth J. Worzel 153,852
 *
(f)Anne L. Bramman 18,396 *
(g)Christine F. Deputy 61,212
 *
(h)Philip G. Satre 87,196 *
(i)B. Kevin Turner 36,720 *
(j)Brad D. Smith 18,585 *
(k)Gordon A. Smith 17,779 *
(l)Shellye L. Archambeau 17,175
 *
(m)Bradley D. Tilden 12,783 *
(n)Tanya L. Domier 12,062
 *
(o)Stacy Brown-Philpot 8,100 *
(p)Kirsten A. Green 772 *
(q)Glenda G. McNeal 772 *
(r)Directors and Executive Officers as a group (21 persons) 8,164,921
 5.21
 Other >5% Security Holders  
  
(s)
The Vanguard Group
   100 Vanguard Blvd.
   Malvern, PA 19355
 13,686,020
 8.83
**    Does not exceed 1% of the Company’s outstanding Common Stock.

70 NORDSTROM, INC. - 2019 Proxy Statement  


(a)Bruce A. Nordstrom
Amount and nature of beneficial ownership includes:
10,243,647 shares owned by him directly;
355 nonvoting deferred stock units. The stock units are convertible into Common Stock and payable upon the occurrence of certain events;
261,776 shares owned by his wife individually;
8,490,560 shares held by trusts of which he is a trustee and beneficiary; and
6,244,940 shares held by trusts of which he is a co-trustee and for which he has shared voting and dispositive power. Mr. Nordstrom is a contingent remainderman with respect to these trusts, but disclaims any beneficial ownership with respect to the shares of Common Stock held in the trusts.
(b)Anne E. Gittinger
Amount and nature of beneficial ownership includes:
13,844,023 shares owned by her directly;
4,466 shares held by her in the Company’s 401(k) Plan; andoutstanding Common Stock.
1,555,200 shares held by a trust of which she is a trustee and beneficiary.
Does not include:
5,501,520 shares held by a trust of which she is the beneficiary, but over which she holds no voting or investment power and which are reported as beneficially owned by her brother, Bruce A. Nordstrom.
(c)(a) Peter E. Nordstrom
Amount and nature of beneficial ownership includes:
2,471,488 shares owned by him directly, of which 230,000 shares are pledged as collateral for loans and are in compliance with the Company’s policy regarding pledging;
32,33034,727 shares held by him in the Company’s 401(k) Plan;
502,727479,567 shares that may be acquired by him through stock options exercisable within 60 days after March 15, 2019;10, 2021;
15,560 shares, net of tax withholding, to be acquired through the vesting of RSUs within 60 days of March 10, 2021:
175,533 shares owned by his wife individually;
445472 shares held by his wife in the Company’s 401(k) Plan;
49,060 shares held by trusts of which he is the trustee; and
157,695 shares held by trusts of which he is the trustee, for which he has sole voting and dispositive power and for which he disclaims beneficial ownership.
(d)
61 NORDSTROM, INC. - 2021 Proxy Statement

(b) Erik B. Nordstrom
Amount and nature of beneficial ownership includes:
2,583,0882,587,380 shares owned by him directly, of which 457,582 shares are pledged as collateral for loans and are in compliance with the Company’s policy regarding pledging;
24,80226,708 shares held by him in the Company’s 401(k) Plan;
502,727479,567 shares that may be acquired by him through stock options exercisable within 60 days after March 15, 2019;10, 2021;
15,568 shares, net of tax withholding, to be acquired through the vesting of RSUs within 60 days of March 10, 2021:
42,646 shares owned by his wife individually; and
24,530224,125 shares held by a trust of which he is the trustee.
(e)(c) Kenneth J. Worzel
Amount and nature of beneficial ownership includes:
19,92330,264 shares owned by him directly;
5,6716,021 nonvoting stock units held under the Company’s Executive Deferred Compensation Plan;NDCP;
4,2225,061 shares held by him in the Company’s 401(k) Plan; and
124,036165,216 shares that may be acquired by him through stock options exercisable within 60 days after March 15, 2019.


10, 2021; and
NORDSTROM, INC. - 2019 Proxy Statement 7126,692 shares, net of tax withholding, to be acquired through the vesting of RSUs within 60 days of March 10, 2021.

(d) Edmond Mesrobian
Amount and nature of beneficial ownership includes:

26,122 shares owned by him directly; and
be acquired through the vesting of RSUs within 60 days of March 10, 2021.

(f)(e) Anne L. Bramman
Amount and nature of beneficial ownership includes:
18,39622,105 shares owned by her directly.directly; and
(g) Christine F. Deputy22,543 shares, net of tax withholding, to be acquired through the vesting of RSUs within 60 days of March 10, 2021.
(f) Brad D. Smith
Amount and nature of beneficial ownership includes:
13,124 shares owned by her directly; and
48,088 shares that may be acquired by her through stock options exercisable within 60 days after March 15, 2019.
(h) Philip G. Satre
Amount and nature of beneficial ownership includes:
20,366 nonvoting deferred stock units. The stock units are convertible into Common Stock and payable upon the occurrence of certain events, including his retirement from the Board; and
66,83050,169 shares held by a family trust, of which he is a trustee and beneficiary.
(i) B. Kevin Turner
Amount and nature of beneficial ownership includes:
36,720 shares owned by him directly.
(j) Brad D. Smith
Amount and nature of beneficial ownership includes:
18,585 shares held by a family trust, of which he is a trustee and beneficiary.
(k) Gordon A. Smith
Amount and nature of beneficial ownership includes:
17,779 shares owned by him directly.
(l)(g) Shellye L. Archambeau
Amount and nature of beneficial ownership includes:
2,2966,614 shares owned by her directly;
9,041 shares held by a limited liability company of which she has control; and
14,87915,796 nonvoting deferred stock units. The stock units are convertible into Common Stock and payable upon the occurrence of certain events, including her retirement from the Board.
(m)(h) Bradley D. Tilden
Amount and nature of beneficial ownership includes:
12,78326,142 shares held by a family trust, of which he is a trustee and beneficiary.
(n)
(i) Tanya L. Domier
Amount and nature of beneficial ownership includes:
12,06225,421 shares owned by her directly.
(o)(j) Stacy Brown-Philpot
Amount and nature of beneficial ownership includes:
3,444 shares owned by her directly; and
4,65618,529 nonvoting deferred stock units. The stock units are convertible into Common Stock and payable upon the occurrence of certain events, including her retirement from the Board.
(p)(k) Kirsten A. Green
Amount and nature of beneficial ownership includes:
77214,131 shares owned by her directly.
(q)(l) Glenda M.G. McNeal
Amount and nature of beneficial ownership includes:
77214,131 shares owned by her directly.

(m) James L. Donald
Amount and nature of beneficial ownership includes:
72 NORDSTROM, INC. - 9,041 shares held in a trust of which he is a trustee beneficiary.
(n) Mark J. Tritton
Amount and nature of beneficial ownership includes:
2019 Proxy Statement  9,041 shares owned by him directly.


(r)(o) Directors and executive officersExecutive Officers as a group (21(22 persons)
Collectively, the combined amount and nature of beneficial ownership for the Directors and all executive officersExecutive Officers include:
5,698,4055,976,828 shares owned directly, of which 705,977687,582 shares are pledged as collateral for third party obligations;
730,713824,958 shares owned by spouses and trusts of which the respective Director or executive officerExecutive Officer is a trustee, or a trustee and beneficiary;
39,90234,325 nonvoting stock units held by participating Directors under the Directors Deferred Compensation Plan;DDCP;
5,6716,021 nonvoting stock units held by participating executive officersExecutive Officers under the Nordstrom Deferred Compensation Plan;NDCP;
81,41096,564 shares held by participating executive officersExecutive Officers and their eligible spouses in the Company’s 401(k) Plan; and
1,608,8201,738,618 shares that may be acquired by the executive officersExecutive Officers as a group through stock options exercisable within 60 days after March 15, 2019.10, 2021; and
175,525 shares, net of tax withholding, to be acquired through the vesting of RSUs within 60 days of March 10, 2021.
NORDSTROM, INC. - 2021 Proxy Statement 62

(p) Bruce A. Nordstrom
Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2020, the aggregate amount beneficially owned by Mr. Nordstrom includes:
24,236,227 shares for which he has sole power to vote or to dispose or to direct disposition; and
1,005,196 shares for which he has shared power to vote or to dispose or to direct disposition.
(q) Anne E. Gittinger
Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2020, the aggregate amount beneficially owned by Ms. Gittinger includes:
15,404,246 shares for which she has sole power to vote or to dispose or to direct disposition.
(r) FMR, LLC
Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2020, the aggregate amount beneficially owned by FMR, LLC includes:
589,028 shares for which it has sole power to vote or to direct the vote; and
13,656,832 shares for which it has sole power to dispose or to direct disposition.
(s) Blackrock, Inc.
Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2020, the aggregate amount beneficially owned by Blackrock, Inc. includes:
9,617,472 shares for which it has the sole power to vote or to direct the vote; and
10,402,108 shares for which it has sole power to dispose or to direct disposition.
(t) The Vanguard Group
Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2018,2020, the aggregate amount beneficially owned by The Vanguard Group includes:
13,502,34373,218 shares for which it has soleshared power to vote or to dispose or to direct disposition; andthe vote;
183,677160,802 shares for which it has shared power to dispose or to direct disposition.disposition; and
9,505,081 shares for which it has sole power to dispose or to direct disposition.


Delinquent Section 16(a) Beneficial Ownership Reporting ComplianceReports
Based upon a review of reports filed with the SEC and written representations that no other reports were required, the Company believes that during the fiscal year ended February 2, 2019January 30, 2021 all of our Directors, Executive Officers and
owners of in excess of 10% of Common Stock complied with the filing requirements of Section 16(a) of the Exchange Act, except that Bruce Nordstrom filed one report on Form 4 was filed late on behalf of Teri Bariquit relating to the distributiona purchase of shares frompursuant to the Directors Deferred Compensation Plan.ESPP.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Review and Approval Process
We maintain policies and procedures regarding the identification, review and approval of related party transactions. In compliance with SEC rules, the Corporate Governance and Nominating CommitteeCGNC reviews and approves or disapproves any transaction or series of related transactions in which: (1) the amount involved exceeds $120,000, (2) the Company or any of its subsidiaries is a participant, and (3) a related party (a Director or Executive Officer of the Company, any nominee for director, any greater than 5% shareholders and any immediate family member of such persons) has a direct or indirect material interest. When
considering a transaction, the CommitteeCPCC will review all relevant factors, including the Company’s rationale for entering into a related party transaction, alternatives to the transaction, whether the transaction is on terms at least as fair to the Company as would be the case if the transaction were entered with a third party, and the potential of an actual or apparent conflict of interest. After reviewing the information, the CommitteeCPCC will approve or ratify the transaction or transactions only if the CommitteeCPCC determines that the transaction is reasonable and fair to the Company.
Related Party Transactions
Property Sublease. The Company leases a parcel of land from King County, Washington at the King County International Airport and operates its flight department from that location. The size of the Company’s flight department is such that the Company does not require access to or use of the entire parcel, and is able to sublease a portion of the property to Hangar Three LLC (“LLC”) without affecting the Company’s flight operations. LLC is
owned by James F. Nordstrom, Jr., John N. Nordstrom and the estate of Blake W. Nordstrom, James F. Nordstrom, Jr. and John N. Nordstrom. LLC constructed a hangar for storage of the owners’ personal aircraft on the subleased property. All architectural, project management and construction costs for the hangar, utilities and landscaping improvements were borne by LLC and not by the Company. Upon expiration or termination of the sublease, the hangar
63 NORDSTROM, INC. - 2021 Proxy Statement

improvements will be surrendered to the Company. The material terms of the sublease are as follows:
The current sublease carries a month-to-month term, through July 2020, with the Company having the right to terminate it at any time upon 9030 days’ notice to LLC, and payment to LLC of the unamortized portion of the construction cost of the hangar.LLC.
LLC pays the Company a monthly base rent and estimated real estate tax in the form of reimbursement to the Company of its pro ratapro-rata share of ground rent paid by the Company
under the primary lease with King County, currently $11,082 per month.
LLC also pays the Company additional rent in the form of $1,035 per month for reimbursement to the Company of its pro ratapro-rata share of maintenance costs of the common areas, currently $900 per month, plus a monthly management fee of $135.


costs.
NORDSTROM, INC. - 2019 Proxy Statement 73



LLC paid a one-time security deposit in August 2007 in the amount of $10,463, plus an additional sum of $6,069 was paid in August 2009, $3,141 was paid in August 2015, and $491 was paid in August 2018 to increase the security deposit amount to the required two times the current base rent of $10,082.
In total, LLC paid the Company rent of $143,685$145,530 during the fiscal year ended February 2, 2019 (total rent is inclusive of the month of February).
Venture Investment. On February 26, 2019, Kirsten Green was appointed to serve as a member of the Company’s Board of Directors. Ms. Green is the Founder and Managing Partner of Forerunner Ventures Management, LLC (“Forerunner”), a venture capital firm. During the fiscal year ended February 2, 2019, the Company made aggregate investments of $1,800,276 in Forerunner limited partnerships for which Ms. Green, or certain of her affiliates, served as the general partner and in which Ms. Green may be deemed to have a pecuniary interest. On January 30, 2019, prior to Ms. Green’s appointment to the Board of Directors, the Company divested itself of all of its Forerunner Ventures investments.2021.
OTHER MATTERS
The Board knows of no other matters that will be presented at the Annual Meeting. However, if any other matters are properly presented at the Annual Meeting or any convening or reconvening of the Annual Meeting upon an adjournment or
postponement of the Annual Meeting, it is the intention of the persons named as proxies to vote in accordance with their best judgment.

74 NORDSTROM, INC. - 2019 Proxy Statement  


20202022 ANNUAL MEETING OF SHAREHOLDERS INFORMATION
Requirements and Deadlines for Submission of Proxy Proposals, Nomination of Directors, and Other Business of Shareholders
If a shareholder wants the Company to include a shareholder proposal in our Proxy Statement for the 20202022 Annual Meeting of Shareholders pursuant to SEC Rule 14a-8 promulgated under the Securities Exchange Act, of 1934, (“Exchange Act”) our Corporate Secretary must receive the proposal at our principal executive offices no later than December 11, 2019.8, 2021. Any such proposal must comply with all the requirements of Rule 14a-8.
Under our Bylaws, shareholders must follow certain procedures to nominate a person for election as a director at an annual or special meeting, or to introduce an item of business at an annual meeting. Under these advance-notice procedures, shareholders must submit the proposed nominee or item of business by delivering a notice to the Corporate Secretary of the Company at our principal executive offices. We must receive notice as follows:
We must receive notice of a shareholder’s intention to introduce a nomination or proposed item of business for an annual meeting not less than 90 days nor more than 120 days before the first anniversary of the prior year’s meeting. Assuming that the Annual Meeting is held on schedule, we must receive notice pertaining to the 20202022 Annual Meeting of Shareholders no earlier than January 24, 202019, 2022 and no later than February 23, 2020.18, 2022.
However, if we hold the 20202022 Annual Meeting of Shareholders on a date that is not within 30 days before or after such anniversary date, we must receive the notice no later than ten days after the earlier of the date we first provide notice of the meeting to shareholders or announce it publicly.
If we hold a special meeting to elect directors, we must receive a shareholder’s notice of intention to introduce a nomination no later than ten days following the day on which notice of the annual meeting was mailed to shareholders.
Our Bylaws provide that notice of a proposed nomination must include certain information about the shareholder and the nominee, as well as a written consent of the proposed nominee to serve if elected. A notice of a proposed item of business must include a description of and the reasons for bringing the proposed business to the meeting, any material interest of the shareholder in the business and certain other information about the shareholder. Any notice (other than a proposal pursuant to Rule 14a-8) that is received after the times specified herein for proposed items of business will be considered untimely under Rule 14a-4c under the Exchange Act. The persons named in the proxy for the meeting may exercise their discretionary voting power with respect to all such matters, including voting against them. All director nominations and shareholder proposals, other than shareholder proposals made pursuant to Rule 14a-8 under the Exchange Act, must comply with the requirements of the Company’s Bylaws. You may obtain a copy of the Company’s Bylaws at no cost from the Company’s Corporate Secretary or online at investor.nordstrom.comby selectingon the Corporate Governance item in theCompany’s Investor Relations drop-down menu.Website. The contact information for the Company’s Corporate Secretary is on page 79.69.


NORDSTROM, INC. - 20192021 Proxy Statement 7564



FREQUENTLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
1.Why am I receiving these materials?
The Company has
We have made these materials available to you on the Internetinternet or, upon your request, delivered printed versions of these materials to you by mail, because you were a shareholder of Nordstrom, Inc.the Company as of March 15, 2019,10, 2021, the Record Date, and
were entitled to receive notice of the 20192021 Annual Meeting of Shareholders and to vote on matters that will be presented at the Annual Meeting.
2.What items will be voted on at the Annual Meeting?
Shareholders will vote on the following matters at the Annual Meeting:Board Recommendation:
Page Reference
(for more detail):
Proposal 1To elect the 1110 Director nominees to the Board named in this Proxy Statement to the Board to serve until the 2022 Annual Meeting of ShareholdersFOR each Director Nominee
Proposal 2To ratify the appointment of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm to serve for the 2022 fiscal yearFOR
Proposal 3To conduct an advisory vote regarding the compensation of our Named Executive OfficersNEOsFOR
Proposal 4To approve the Nordstrom, Inc. 2019 Equity Incentive PlanFOR64
OtherSuch other business as may properly come before the Annual Meeting and any adjournments or postponements thereof  
3.How can I view the webcast? WhereWhat is the date and time of the Annual Meeting being held?Meeting?
Date & Time:May 19, 2021 at 9:00 a.m. Pacific Daylight TimeVirtual Meeting Access:virtualshareholdermeeting.com/JWN2021
This Proxy Statement was first mailed to shareholders on or about April 8, 2021. It is furnished in connection with the solicitation of proxies by the Board to be voted during the Annual Meeting for the purposes set forth in the accompanying Notice of Annual Meeting.
Shareholders who execute proxies retain the right to revoke them at any time before the shares are voted by proxy during the meeting. A shareholder may revoke a proxy by delivering a signed statement to our Corporate Secretary prior to or during the Annual Meeting or by timely executing and delivering, by internet, telephone, or mail, another proxy dated as of a later date.
4.How do I participate in the Meeting?
This year’s Annual Meeting will be accessible through the internet. We have adopted a virtual format for our Annual Meeting to make participation accessible for shareholders from any geographic location with internet connectivity. We have worked to offer the same participation opportunities as were provided at the in-person portion of our past meetings while further enhancing the online experience available to all shareholders regardless of their location. The accompanying proxy materials include instructions on how to participate in the meeting and how you may vote your shares of Company stock.
You can vieware entitled to participate in the live webcastAnnual Meeting if you were a shareholder as of the close of business on March 10, 2021, the record date, or hold a valid proxy for the meeting. To be admitted to the Annual Meeting at investor.nordstrom.comvirtualshareholdermeeting.com/JWN2021. Select Events, and follow, you must enter the instructions given. If16-digit control number found next to the label “Control Number” for postal mail recipients or within the body of the email sending you would like to attendthe Proxy Statement.
Whether or not you participate in the Annual Meeting, in person, it is being heldimportant that your shares be part of the voting process. You may log on to proxyvote.com and enter your Control Number.
This year’s shareholder question and answer session will include questions submitted in advance of, and questions submitted live during, the John W. Nordstrom Room, 5th floor, locatedAnnual Meeting. You may submit a question in advance of the meeting at proxyvote.com after logging in with your Control Number. Questions may be submitted during the Annual Meeting through virtualshareholdermeeting.com/JWN2021. We will post questions and answers if applicable to Nordstrom’s business on the Nordstrom Downtown Seattle Store, 1617 Sixth Avenue, Seattle, Washington 98101.Investor Relations website shortly after the meeting.
We encourage you to access the Annual Meeting before it begins. Online check-in will start shortly before the meeting on May 19, 2021. If you have difficulty accessing the meeting, please call (844) 986-0822 (toll free) or (303) 562-9302 (international). We will have technicians available to assist you.
65 NORDSTROM, INC. - 2021 Proxy Statement

4.5.Why did I receive a Notice instead of a full set of proxy materials? How can I access the proxy materials online?
We are furnishing proxy materials to our shareholders primarily via the Internetinternet as manythe holders of a majority of our shareholdersshares prefer that method. By doing so, we increase the convenience of our proxy materials, reduce the environmental impact of our Annual Meeting, and save costs. On or about April 12, 2019,8, 2021, we mailed a Notice of Internetinternet Availability of Proxy Materials (the “Notice”) to our shareholders who had not previously requested printed materials.
The Notice contains instructions about how to access our proxy materials and vote online. If you would like to receive a paper copy of our proxy materials, please follow the instructions included in the Notice. If you have previously chosen to receive our proxy materials electronically, you will receive access to these materials via email unless you elect otherwise.
5.6.What is a proxy statement, and what is the purpose of this Proxy Statement?a proxy?
If
A proxy statement is a document that SEC rules require us to provide you designatewhen we ask you to vote on certain matters at a meeting of our shareholders or when we ask you to sign a proxy designating certain individuals to vote on those matters on your behalf. A proxy is your legal designation of another person to vote yourthe shares that other person is calledyou own at a proxy. If you designate someone as your proxy in a written document, that document is also called a proxy or a proxy card. If you vote online or completemeeting of our shareholders. By signing the proxy card enclosed with the materials sent by mailwe provide to give us your proxy,you, you will have designateddesignate Anne L. Bramman, our Chief Financial Officer, and Kelley Hall,Ann Munson Steines, our Chief Accounting Officer,General Counsel and
Corporate Secretary, as your proxies to vote your shares as you have directed. This Proxy Statement provides information aboutdirected during the mattersAnnual Meeting. Our Board is soliciting your proxy to be voted on by shareholders atvote your shares during the Annual Meeting along with other information regarding the governanceand any adjournment or postponement of the Company, including our Board Committee structuremeeting. Nordstrom pays the cost of soliciting your proxy and executive compensation.reimburses brokers and others for forwarding you the proxy statement, proxy card or voting instruction form, Annual Report and Notice.

76 NORDSTROM, INC. - 2019 Proxy Statement  


6.7.What is the difference between a shareholder of record and a street name shareholder?
Many Company shareholders hold their shares through a stockbroker, bank or other nominee rather than directly in their own names. As summarized below, there are some distinctions between shares held as a shareholder of record and those held in street name.
Shareholders of record: If your shares are registered directly in your name with the Company’s transfer agent, Computershare, you are considered the “shareholder of record” or a “registered shareholder,” and the Notice or proxy materials are being sent directly to you by the Company. As the shareholder of record, you have the right to grant your voting proxy directly to the Company or to vote in person at the Annual Meeting.
Street name shareholders: If your shares are held in a stock brokerage account or by a bank, trustee or nominee, you are considered the beneficial owner of shares held in “street name,” and the Notice or proxy materials are being forwarded to you by your broker, bank or other holder of record who is considered the shareholder of record. As the street name shareholder you have the right to direct your broker, bank or other holder of record on how to vote your shares and you are invited to attend the Annual Meeting. Your broker, bank, trustee or nominee is obligated to provide you with a voting instruction form for you to use.
7.8.How do I cast my vote?
We encourage you to vote in advance of the meeting on the Internetinternet or by telephone. It is convenient, and it saves us significant postage and processing costs. In addition, when you vote on the Internetinternet or by telephone, your vote is recorded immediately and there is no risk that postal delays will cause your vote to arrive late and therefore not be counted. The method by which you vote your proxy will not limit your right to vote at the Annual Meeting if you decide to attend in person.
Shareholders of record: The Internetinternet and telephone voting procedures are designed to verify that you are a shareholder of record by using a control number and allowing you to confirm that your voting instructions have been properly recorded. Internet and telephone voting for shareholders of record are available 24 hours a day and will close at 11:59 p.m. Eastern Daylight Time on May 22, 2019.day. You can vote by any of the following methods:
computera01.jpg
Voting on the Internet.You may vote In advance of the meeting, until 11:59 p.m. Eastern Daylight Time on May 18, 2021 using any of the Internet by using the voting portal found at www.proxyvote.com. You can then confirm that your instructions have been properly recorded.
following methods:
phonea01.jpggraphics_secretaryoffice212.jpg
Voting by Telephone. If you request printed materials, you may vote by telephone using the toll-free number listed on your proxy card. Voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded.Online
At proxyvote.com
*
Voting by Mail. If you request printed materials, you may vote by signing, dating and returning your proxy card.
personicon.jpg graphics_secretaryoffice112.jpg
Voting in Person. You may voteToll-free Phone
Call 1-800-690-6903
icon_mlgray1.jpg
Mail
Vote Processing
c/o Broadridge
51 Mercedes Way Edgewood, NY 11717
icon_pvcomxqr12.jpg
Scanned QR Code
Using your shares at the Annual Meeting.mobile device
Street name shareholders: You may vote by the method explained on the proxy card or the information you receive from the bank, broker or other record holder. If you are a street
name shareholder, you must obtain a proxy, executed in your favor, from the bank, broker or other holder of record to be able to vote in person at the Annual Meeting.
NORDSTROM, INC. - 2021 Proxy Statement 66

Shareholders holding shares invested in the Company’s 401(k) Plan: If you participate in the Company’s 401(k) Plan, the number of shares of Common Stock in your account as of the Record Date are reflected on your proxy notice and may be voted as described above for shareholders of record. However, if your vote on those shares is not received by 11:59 p.m. Eastern Daylight Time on May 19, 2019,15, 2021, then the Company’s Retirement CommitteePlan Trustee will vote those shares in the same proportion as all other 401(k) Plan shares that have been voted.
Shareholders holding shares purchased through the Company’s Employee Stock Purchase PlanESPP: If you hold Common Stock that you acquired through the Company’s Employee Stock Purchase Plan,ESPP, you are the beneficial owner of those shares and your shares may be voted as described above for street name shareholders.


NORDSTROM, INC. - 2019 Proxy Statement 77



8.9.What does it mean if I receive more than one Notice or package of proxy materials?
This means that you have multiple accounts holding Nordstrom shares. These may include: accounts with our transfer agent, Computershare; shares held in the Nordstrom 401(k) Plan or purchased through the Employee Stock Purchase Plan;ESPP; and accounts with a broker,
bank or other holder of record. Please vote all Notices, voting instruction forms and proxy cards that you receive to ensure that all of your shares are voted.
9.10.Why did multiple shareholders at my address only receive one Notice or package of proxy materials?
SEC rules allow us to use a procedure called “householding” to deliver only en copy of our Notice, and for those shareholders that received a paper copy of proxy materials in the mail, one copy of our Annual Report, to multiple shareholders who share the same address (if they appear to be members of the same family) unless we have received contrary instructions from an affected shareholder. Shareholders who participate in householding will continue to receive proxy cards if they received a paper copy of proxy materials in the mail. By using the householding process, we reduce our printing costs, mailing costs and fees, and reduce the environmental impact of our annual meeting. If you are a shareholder, share an address
and last name with one or more other shareholders, and would like to revoke your householding consent, or you are a shareholder eligible for householding and would like to participate, please contact Broadridge, either by calling toll free at (866) 540-7095 or by writing to Broadridge, Householding Department, 51 Mercedes Way, Edgewood, New York 11717. You will be removed from the householding program within 30 days of receipt of the revocation of your consent. A number of brokerage firms have also instituted householding. If you hold your shares in street name, please contact your bank, broker or other holder of record to request information about householding.
11.What is a quorum and what is the voting requirement to approve each of the proposals?
We will have a quorum and will be able to conduct the business of the Annual Meeting if at least 77,476,37878,885,190 shares, a majority of the outstanding shares of Common Stock as of the Record Date, are present at the Annual Meeting, either in person or by proxy. Your shares will be counted toward the number needed for a quorum if you: (i) vote on the Internetinternet or
by telephone; (ii) submit a valid proxy card or voting instruction form; or (iii) in the case of a shareholder of record, attend the Annual Meeting and vote your shares in person.
To elect directors and adopt the other proposals, the following votes are required:
Discretionary
ProposalVote RequiredDiscretionary Voting Allowed?
Election of ten Directors to serve until the 2022 Annual Meeting of ShareholdersMajority of Votes CastNo
Ratification of the Appointmentappointment of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm to serve for the 2022 fiscal yearMajority of Votes CastYes
Advisory Vote Regarding Executive CompensationTo conduct an advisory vote regarding the compensation of our NEOsMajority of Votes CastNo
Approval of the Nordstrom, Inc. 2019 Equity Incentive PlanMajority of Votes CastNo
67 NORDSTROM, INC. - 2021 Proxy Statement

Under Washington corporation law and our Articles of Incorporation and Bylaws, the approval of any corporate action taken at a shareholder meeting is based on votes cast. “Votes cast” means votes actually cast “for” or “against” a particular proposal, whether by proxy or in person. Broker nonvotes (broker nonvotes and discretionary voting are explained in the answer to Question 12)14.) and abstentions are not considered “votes cast” and have no effect on the proposals.
Election of TenDirectors; Majority Vote Policy: In the election of Directors, the Company has adopted a majority voting standard as described in more detail on page 1312 under Director Elections. Because this is an uncontested election, an incumbent directorDirector nominee will be elected if the votes cast “for” the nominee’s election exceed the votes cast “against” the nominee. If a directorDirector nominee does not receive the requisite votes, that Director’s term will end on the date on which an individual is selected by the Board to fill the position held by such Director or 90 days after the date the election results are determined, whichever occurs first.
You may vote “for,” “against” or “abstain” with respect to the election of each nominee.
Ratification of the Appointment of Independent Registered Public Accounting Firm: Under the Company’s Bylaws, the votes cast “for” must exceed the votes cast “against” to ratify the appointment of Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending February 2, 2019.January 29, 2022. You may vote “for,” “against” or “abstain” on this proposal.
Advisory Vote Regarding Executive Compensation: The votes cast “for” must exceed the votes cast “against” to approve, on an advisory basis, the Company’s executive compensation program. You may vote “for,” “against” or “abstain” on this proposal.
ApprovalThe Board recommends a vote FOR each of the Nordstrom, Inc. 2019 Equity Incentive Plan: Under the Company’s Bylaws, the votes cast “for” must exceed the votes cast “against” to ratify the Nordstrom, Inc. 2019 Equity Incentive Plan. You may vote “for,” “against” or “abstain” on this proposal.foregoing proposals.
10.12.Can I change my mind after I vote?
Yes, if you vote by proxy, you may revoke that proxy at any time before it is voted at the Annual Meeting. You may do this by:
voting again on the Internetinternet or by telephone prior to the Annual Meeting; or
signing another proxy card with a later date and mailing it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717, prior to the Annual Meeting; or
attending the Annual Meeting in person and delivering your proxy or casting a ballot.

78 NORDSTROM, INC. - 2019 Proxy Statement  ballot during the meeting.


11.13.What if I do not return my proxy card or voting instruction form or do not provide voting instructions?
Shareholders of record: If you are a registered shareholder and do not vote by Internetinternet or phone or return your voted proxy card, your shares will not be voted. If you submit your proxy card with an unclear voting designation or no voting designation at all, your shares will be voted for the ratification of Deloitte, but not on any of the other proposals.
Street name shareholders: If you are a beneficial owner whose shares are held by a broker, your broker has discretionary voting authority under NYSE rules to vote your shares for the ratification of Deloitte even if the broker does not receive voting instructions from you. However, your broker does not have discretionary authority to vote on the election of Directors, the advisory vote regarding executive compensation or on any shareholder proposal without instructions from you, in which case a broker nonvote will occur. Since shares that constitute broker nonvotes will not be included in vote totals and have no effect on the outcome of the election of Directors, the advisory vote regarding
executive compensation or any other matters properly brought before the meeting, it is important that you instruct your broker on how to vote your shares.
Shareholders with shares invested in the Company’s 401(k) Plan: If your vote of shares held through the Company’s 401(k) Plan is not received by 11:59 p.m. Eastern Daylight Time on May 19, 2019,15, 2021, then the Company’s Retirement CommitteePlan Trustee will vote your shares in the same proportion as shares that have been voted in the 401(k) Plan. If you submit your proxy card with an unclear voting designation or no voting designation at all, your shares will be voted by the Retirement CommitteePlan Trustee “for” all proposals. If any additional proposals are properly presented at the Annual Meeting and any adjournment thereof, the Retirement CommitteePlan Trustee will vote on the additional proposals in accordance with its discretion.

12.14.Will abstentions or broker nonvotes affect the voting results?
If you abstain from voting on a proposal, or if a broker or bank indicates it does not have discretionary authority to vote on a proposal, the shares will be counted for the purpose of determining if a quorum is present, but will have no effect on
the other proposals to be considered at the Annual Meeting since these actions do not represent votes cast by shareholders.
NORDSTROM, INC. - 2021 Proxy Statement 68

13.15.Who will count the vote?
Broadridge Investor Communication Services (“Broadridge”) was appointed by the Board to tabulate the vote and act as Inspector of Election. Information about Broadridge is available at broadridge.com.broadridge.com. Proxies and ballots that identify the votes of individual shareholders are kept confidential from the Company’s management and Directors. Only Broadridge,
as the proxy tabulator and the Inspector of Election, has access to the ballots, proxy forms and voting instructions. Broadridge will disclose information taken from the ballots, proxy forms and voting instructions only in the event of a proxy contest or as otherwise required by law.
14.16.Where can I find the voting results of the Annual Meeting?
We intend to announce preliminary voting results at the Annual Meeting and publish final results on a current report on Form 8-K within four business days of the Annual Meeting. The Form
8-K will be available online under the “SEC Filings” tab at investor.nordstrom.com.the Investor Relations Website.
15.17.Who will bearHow can I communicate with the costBoard of this proxy solicitation?Directors?
Shareholders and other interested parties may communicate with Directors by contacting the Corporate Secretary’s Office at:
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Telephone: 206-303-2541
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E-mail: board@nordstrom.com
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Mail: Nordstrom, Inc.
1617 Sixth Avenue
Seattle, Washington 98101
Attn: Corporate Secretary
The CompanyCorporate Secretary will bearrelay the costquestion or message to the specific Director with whom the shareholder or interested party wishes to communicate.
If no specific Director is requested, the Corporate Secretary will relay the question or message to the Chairman. Certain items that are unrelated to the duties and responsibilities of this proxy solicitation, including reimbursing banksthe Board, such as business solicitations, advertisements, junk mail and brokers for reasonable expenses of sending out proxy materialsother mass mailings, will not be relayed to street name shareholders.Directors.
The AFC has established procedures to respond to possible concerns about ethics and accounting-related practices. To report your concerns, you may use the Company’s confidential Whistleblower Hotline at:
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Telephone: 1-888-832-8358
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Internet: ethicspoint.com
Your concerns will be investigated and communicated to the AFC, as necessary.
16.18.What if I have additional questions that are not addressed here?
You may call Nordstrom Investor Relations at 206-303-3200, e-mail Investor Relations at invrelations@nordstrom.com,Invrelations@Nordstrom.com, or call the Corporate Secretary’s Office at 206-303-2541.


69 NORDSTROM, INC. - 20192021 Proxy Statement79



Appendix A
Reconciliation of GAAP and Non-GAAP Financial Measures
Incentive Earnings Before Interest and Income Tax Expense (“Incentive EBIT”) and Incentive Adjusted Return on Invested Capital (“Incentive Adjusted ROIC”)
Incentive Adjusted EBIT and Incentive Adjusted ROIC
We believe that Incentive Adjusted ROIC is a useful financial measure for investors in evaluating the efficiency and effectiveness of the capital we have invested in our business to generate returns. Incentive Adjusted ROIC adjustsreturns over time. In addition, we have incorporated it in our executive incentive measures and we believe it is an important indicator of shareholders’ return over the long term.
For 2020 and 2019, income statement activity for adjusted net operating profit and balance sheet amounts for average invested capital are measured under the Lease Standard and the remaining years disclosed are under the previous lease standard. Under the previous lease standard, we estimated the value of our operating leases as if they met the criteria for capital leases or we had purchased the properties. This providesprovided additional supplemental information that reflectsestimated the investment in our off-balance sheetoperating leases. Estimated depreciation on capitalized operating leases controlsand average estimated asset base of capitalized operating leases are not calculated in accordance with, nor an alternative for, differencesGAAP and should not be considered in capital structure between us andisolation or as a substitute for our competitors and provides investors and credit agencies with another way to comparably evaluate the efficiency and effectiveness of our capital investments over time. In addition, we incorporate results as reported under GAAP.
Incentive Adjusted ROIC into our executive incentive measures and it is an important indicator of shareholders’ return over the long term.
Incentive EBIT represents net earnings before income tax expense, interest expense and interest income, and contemplates non-operating related adjustments. We define Incentive Adjusted ROIC as our adjusted net operating profit after tax divided by our average invested capital using the trailing 12-month average.capital. These metrics are not measures of financial performance under generally accepted accounting principles (“GAAP”)GAAP and should be considered in addition to, and not as a substitute for, net earnings, return on assets, net earnings, total assets or other GAAP financial measures prepared in accordance with GAAP.measures. Our method of determiningcalculating non-GAAP financial measures may differ from other companies’ methods and therefore may not be comparable to those used by other companies. Estimated depreciation on capitalized operating leases and average estimated asset base of capitalized operating leases are not calculated in accordance with, or an alternative for, GAAP and should not be considered in isolation or as a substitution of our results as reported under GAAP. The financial measures calculated under GAAP which are most directly comparable to Incentive Adjusted EBIT and Incentive Adjusted ROIC are net earnings and return on assets which are reconciled below.assets. The following isis a reconciliation of the components ofreturn on assets to Incentive Adjusted ROIC and return on assets:ROIC:
 12 Fiscal Months Ended
($ in millions)February 2, 2019
 February 3, 2018
 January 28, 2017
 January 30, 2016
 January 31, 2015
Net earnings$564
 $437
 $354
 $600
 $720
Add: income tax expense169
 353
 330
 376
 465
Add: interest expense, net104
 136
 121
 125
 138
Earnings before interest and income tax expense837
 926
 805
 1,101
 1,323
Add: non-operating related adjustments72
 26
 271
 145
 68
Incentive EBIT909
 952
 1,076
 1,246
 1,391
Add: interest income15
 5
 1
 
 1
Incentive Adjusted ROIC earnings before interest and income tax expense924
 957
 1,077
 1,246
 1,392
Add: rent expense251
 250
 202
 176
 137
Less: estimated depreciation on capitalized operating leases*
(134) (133) (108) (94) (74)
Net operating profit1,041
 1,074
 1,171
 1,328
 1,455
Less: estimated income tax expense(248) (480) (444) (512) (561)
Net operating profit after tax$793
 $594
 $727
 $816
 $894
Average total assets$8,282
 $8,055
 $7,917
 $9,076
 $8,860
Less: average non-interest-bearing current liabilities**(3,479) (3,261) (3,012) (2,993) (2,730)
Less: average deferred property incentives and deferred rent liability(b)
(616) (644) (644) (548) (502)
Add: average estimated asset base of capitalized operating leases(a)
2,018
 1,805
 1,512
 1,236
 1,058
Add (Less): non-operating related adjustments4
 3
 90
 623
 (100)
Average invested capital$6,209
 $5,958
 $5,863
 $7,394
 $6,586
Return on assets6.8% 5.4% 4.5% 6.6% 8.1%
Incentive Adjusted ROIC12.8% 10.0% 12.4% 11.0% 13.6%
*
Capitalized operating leases is our best estimate of the asset base we would record for our leases that are classified as operating if they had met the criteria for a capital lease or we had purchased the property. The asset base is calculated based upon the trailing 12-month average of the monthly asset base. The asset base for each month is calculated as the trailing 12 months of rent expense multiplied by eight. The multiple of eight times rent expense is a commonly used method of estimating the asset base we would record for our capitalized operating leases. We do not expect the adoption of the new Lease Standard to have a material impact on our Incentive Adjusted ROIC.
**Balances associated with our deferred rent liability have been classified as long-term liabilities as of January 28, 2017.


 12 Fiscal Months Ended
($ in millions)January 30, 2021February 1, 2020February 2, 2019February 3, 2018January 28, 2017
Net (loss) earnings$(690)$496$564$437$354
Add: income tax (benefit) expense(538)186169353330
Add: interest expense, net181102104136121
EBIT(1,047)784837926805
Add: non-operating related adjustments247226271
Incentive Adjusted EBIT(1,047)8089099521,076
Add: interest income3101551
Incentive Adjusted ROIC EBIT(1,044)8189249571,077
Add: operating lease interest(a)
95101
Add: rent expense, net251250202
Less: estimated depreciation on capitalized operating leases(b)
(134)(133)(108)
Adjusted net operating (loss) profit(949)9191,0411,0741,171
Less: estimated income tax benefit (expense)416(244)(248)(480)(444)
Adjusted net operating (loss) profit after tax$(533)$675$793$594$727
Average total assets$9,718$9,765$8,282$8,055$7,917
Add: average estimated asset base of capitalized operating leases(b)
2,0181,8051,512
Less: average deferred property incentives and deferred rent liability(616)(644)(644)
Less: average deferred property incentives in excess of right-of-use assets(c)
(276)(307)
Less: average non-interest-bearing current liabilities(3,138)(3,439)(3,479)(3,261)(3,012)
Add: non-operating related adjustments4390
Average invested capital$6,304$6,019$6,209$5,958$5,863
Return on assets(7.1 %)5.1 %6.8 %5.4 %4.5 %
Incentive Adjusted ROIC(8.5 %)11.2 %12.8 %10.0 %12.4 %
A-1 NORDSTROM, INC.(a) - 2019 Proxy Statement 


Appendix BNordstrom, Inc. 2019 Equity Incentive Plan
ARTICLE 1Introduction
The purposeAs a result of the Plan is to promote the long-term successadoption of the CompanyLease Standard, we add back the operating lease interest to reflect how we manage our business. Operating lease interest is a component of operating lease cost recorded in occupancy costs and its Subsidiaries. Specific objectives are intended to encourageis calculated in accordance with the attraction and retention of Employees and Nonemployee Directors, focus such individuals’ results on the Company’s critical, long-range goals and align such individuals’ interests with thoseLease Standard.
(b)Capitalized operating leases is our best estimate of the Company’s shareholders.
asset base we would record for our leases that are classified as operating under the previous lease standard if they had met the criteria for a finance lease or we had purchased the property. The Plan seeksasset base for each quarter is calculated as the trailing four quarters of rent expense multiplied by eight, a commonly used method to achieve this purpose by providingestimate the asset base we would record for Awards in the form of Options (which may constitute incentive stock options (ISOs), for Employees only, or nonqualified stock options (NSOs)), stock appreciation rights (SARs), Unrestricted Shares, Restricted Shares, Restricted Stock Units and Performance Share Units.
The Plan replaces the Nordstrom, Inc. 2010 Equity Incentive Plan (as amended and restated February 16, 2017) and the Nordstrom, Inc. 2002 Nonemployee Director Stock Incentive Plan (as amended on November 14, 2007).    
ARTICLE 2Administration
2.1Committee Composition. our capitalized operating leasesThe Compensation Committee shall administer the Plan..
2.2Committee Responsibilities.(c) The Committee, in its absolute and sole discretion, shall (a) selectFor leases with property incentives that exceed the Employees and Nonemployee Directors who areright-of-use assets, we reclassify the amount from assets to receive Awards under the Plan, (b) determine the type, number, vesting requirementsother current liabilities and other features and conditions of such Awards, (c) interpret the Plan and (d) make all other decisions relating to the operationliabilities. As a result of the Plan. The Committee may adopt such rules or guidelines as it deems appropriate to implement the Plan. The Committee may delegate its authority hereunder to one or more Subcommittees or Company officers, to the extent permitted under the Code, applicable laws and regulations and any applicable exchange rules; actions taken by any Subcommittee or officers shall be subject to review by the full Committee. The Committee’s determinations under the Plan shall be final and binding on all persons.
2.3Committee for Non-Officer/Non-Director Awards. The Board may also appoint a secondary committeeadoption of the Board or one or more senior executive officers of the Company to administer the Plan with respect to Employees who are not considered officers or Directors of the Company under Section 16 of the Exchange Act. That committee or senior executive officer may grant Awards under the Plan to such Employees and may determine all features and conditions of such Awards. Within the limitations ofLease Standard, we reduce average total assets, as this Section 2.3, any reference in the Plan to the Committee shall include such secondary committee or senior executive officer, as the case may be.better reflects how we manage our business.
2.4Compensation Department Powers and Duties. Until such time as the Committee shall modify, revoke or rescind such authority, the Company’s Compensation department, or any successor department within the Company, regardless of name, has the powers and duties set forth below. Determinations made by the Compensation department (or other department) under this Section 2.4 shall be final and binding on all persons, but may, in the Committee’s absolute and sole discretion, be reviewed by the Committee. The powers and duties delegated by the Committee hereunder are to:
(a)    work with Plan service providers to ensure the effective administration of the Plan;
(b)    determine whether a Participant’s disability, as defined by a qualified medical professional acceptable to the Company’s Compensation department (or other department), qualifies as Disability as defined under the Plan; and
(c)    perform any and all tasks, duties, and responsibilities delegated by the Company or the Committee.
The Company’s Compensation department has authority to interpret the terms of the Plan and any Award in carrying out the powers and duties as set forth above.
ARTICLE 3Shares Available for Awards and General Vesting Requirements
3.1Basic Limitation. Shares issued pursuant to the Plan shall be authorized but unissued shares. The aggregate number of Shares available for Awards of Options, SARs, Unrestricted Shares, Restricted Shares, Restricted Stock Units or Performance Share Units granted under the Plan shall not exceed (a) 9,500,000 Shares plus (b) the additional shares of Common Stock described in Section 3.3. The limitations of this Section 3.1 and Sections 3.2 and 3.3 shall be subject to adjustment pursuant to Article 12. The aggregate number of Shares available for issuance as Plan Awards shall be reduced by 1.6 (one point six) Shares for each Share delivered in settlement of any Award of Unrestricted Shares, Restricted Shares, Restricted Stock Units, Performance Share Units, dividends, or dividend equivalents, and by 1 (one) Share for each Share delivered in settlement of any Option Award or SAR. Awards that are required to be settled in cash will not reduce the number of Shares available for delivery under the Plan.


NORDSTROM, INC. - 20192021 Proxy Statement B-1A-1


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3.2Additional Shares. If any Shares covered by an Award of Options, SARs, Restricted Shares, Restricted Stock Units or Performance Share Units terminate, lapse or are forfeited or cancelled, or such Award is otherwise settled without the delivery of the full number of Shares underlying the Award, then the Shares covered by such Award, or to which such Award relates, to the extent of any such forfeiture, termination, lapse, cancellation, etc., shall again be, or shall become, available for issuance under the Plan; provided, however, that Shares (a) delivered in payment of the exercise price of an Award, (b) not issued upon the net settlement or net exercise of SARs, (c) delivered to or withheld by the Company to pay withholding taxes related to an Award, or (d) purchased in the open market using option proceeds, shall not become available again for issuance under this Plan. Shares that again become available for issuance under the Plan pursuant to this Section 3.2 shall be added to the number of Shares available under Section 3.1 in the same ratios as applied to them at the time they were originally granted (e.g., 1.6 (one point six) Shares for each Share attributable to previously granted Awards of Restricted Shares, Restricted Stock Units or Performance Share Units and 1 (one) Share for each Share attributable to previously granted Option Awards or SARs).
3.3Additional Shares from Prior Plan. Shares available for issuance under the Plan shall be increased by any shares of Common Stock subject to outstanding Awards under the Prior Plans on the effective date of the Plan, May 23, 2019, that later cease to be subject to such Awards for any reason other than the exercise, or vesting of such Awards (as the case may be), or any amounts withheld from such Awards by the Company for taxes on the Awards, which Shares shall, as of the date such Shares cease to be subject to such Awards, cease to be available for grant and issuance under the Prior Plans, but shall be available for issuance under the Plan under Section 3.1. Shares that become available for issuance under the Plan pursuant to this Section 3.3, shall become available for issuance under the Plan in such amount as they previously reduced the number of Shares available for issuance under the Prior Plans.
3.4General Vesting Requirements. Awards granted under the Plan shall vest no earlier than the first anniversary of the date of grant. Notwithstanding the previous sentence, the Committee may grant Awards representing up to an aggregate maximum of five percent (5%) of the available Share reserve authorized for issuance under the Plan pursuant to Section 3.1 (subject to adjustment under Section 3.3) without regard to the foregoing minimum vesting requirement.
ARTICLE 4Eligibility
4.1Awards. Employees and Nonemployee Directors shall be eligible for the grant of Awards of NSOs, SARs, Unrestricted Shares, Restricted Shares, Restricted Stock Units or Performance Share Units.
4.2Incentive Stock Options. Only Employees who are common-law employees of the Company or a Subsidiary shall be eligible for the grant of ISOs. In addition, an Employee who owns more than ten percent (10%) of the total combined voting power of all classes of outstanding stock of the Company or any of its Subsidiaries shall not be eligible for the grant of an ISO unless the requirements set forth in section 422(c)(6) of the Code are satisfied.
ARTICLE 5Options
Options granted under the Plan are subject to the following terms and conditions:
5.1Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Company. Such Option shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The Stock Option Agreement shall specify whether the Option is an NSO or an ISO. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical.
5.2Number of Shares. Each Stock Option Agreement shall specify the number of shares of Common Stock subject to the Option, which shall be subject to adjustment in accordance with Article 12. Options granted to any Employee in a single fiscal year of the Company shall not cover more than 500,000 shares of Common Stock. Holders of Options shall have no right to dividend equivalents and prior to exercise, no rights to dividends. The limitation set forth in the preceding sentence shall be subject to adjustment in accordance with Article 12.
5.3Exercise Price. Each Stock Option Agreement shall specify the Exercise Price; provided that the Exercise Price under an Option shall in no event be less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the date of grant.
5.4Exercisability and Term. Each Stock Option Agreement shall specify the date or event when all or any installment of the Option is to become exercisable, subject to Section 3.4. The Stock Option Agreement shall also specify the term of the Option; provided that the term shall in no event exceed ten (10) years from the date of grant. A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee’s Disability, death or Retirement and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service. Options may be granted in combination with SARs, and such an Award may provide that the Options will not be exercisable unless the related SARs are forfeited.


B-2 NORDSTROM, INC. - 2019 Proxy Statement 


5.5Effect of Change in Control. In the event that the Optionee experiences a Qualifying Termination within twelve (12) months following a Change in Control then, unless (i) the Committee shall have previously made provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all of such Option for the cash, securities or property deliverable to the holder of any or all outstanding share-based Awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Company’s Common Stock in connection with the Change in Control, or (ii) the Option would otherwise continue in accordance with its terms notwithstanding the occurrence of the Change in Control, such Option shall automatically become fully vested and exercisable. However, in the case of an ISO, the acceleration of exercisability shall not occur without the Optionee’s written consent. In addition, acceleration of exercisability may be required pursuant to Article 12.
5.6Dividend Rights. No dividends or dividend equivalent rights shall be paid or accrued with respect to Options.
ARTICLE 6Payments For Option Shares
6.1General Rule. The entire Exercise Price of shares of Common Stock issued upon exercise of Options shall be payable in cash or cash equivalents at the time when such shares of Common Stock are purchased, except as follows:
(a)    In the case of an ISO granted under the Plan, payment shall be made only pursuant to the express provisions of the applicable Stock Option Agreement. The Stock Option Agreement may specify that payment may be made in any form(s) described in this Article 6.
(b)    In the case of an NSO, the Committee may at any time accept payment in any form(s) described in this Article 6.
6.2Stock Swap. To the extent specifically provided in an Option Agreement, all or any part of the Exercise Price may be paid by surrendering, or attesting to the ownership of, shares of Common Stock that are already owned by the Optionee. Such shares of Common Stock shall be valued at their Fair Market Value on the date when the new shares of Common Stock are purchased under the Plan.
6.3Exercise/Sale. To the extent that this Section 6.3 is applicable and to the extent so provided in the Stock Option Agreement, all or any part of the Exercise Price and any withholding taxes may be paid by delivery to the Company of other Common Stock, duly endorsed for transfer to the Company, with a Fair Market Value on the date of delivery equal to the Option Exercise Price (or portion thereof) due for the number of shares being acquired, or by means of attestation whereby the Participant identifies for delivery specific shares of Common Stock that have an aggregate Fair Market Value on the date of attestation equal to the Option Exercise Price (or portion thereof) and receives a number of shares of Common Stock equal to the difference between the number of shares thereby purchased and the number of identified attestation shares of Common Stock (a “Stock for Stock Exchange”); (ii) a “cashless” exercise program established with a broker; (iii) Net Exercise; (iv) by any combination of the foregoing methods; or (v) in any other form of legal consideration that may be acceptable to the Committee.
ARTICLE 7Stock Appreciation Rights
SARs granted under the Plan are subject to the following terms and conditions:
7.1SAR Agreement. Each SAR granted under the Plan shall be evidenced by an SAR Agreement between the Participant and the Company. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various SAR Agreements entered into under the Plan need not be identical.
7.2Number of Shares. Each SAR Agreement shall specify the number of shares of Common Stock to which the SAR pertains and shall provide for the adjustment of such number in accordance with Article 12. SARs granted to any Participant in a single calendar year shall in no event pertain to more than 500,000 shares of Common Stock. The limitation set forth in the preceding sentence shall be subject to adjustment in accordance with Article 12.
7.3Exercise Price. Each SAR Agreement shall specify the Exercise Price; provided that the Exercise Price under an SAR shall in no event be less than one hundred percent (100%) of the Fair Market Value of a share of Common Stock on the date of grant.
7.4Exercisability and Term. Each SAR Agreement shall specify the date when all or any installment of the SAR is to become exercisable, subject to Section 3.4. The SAR Agreement shall also specify the term of the SAR; provided, however, that the term shall in no event exceed ten (10) years from the date of grant. A SAR Agreement may provide for accelerated exercisability in the event of the Participant’s Disability, death or Retirement and may provide for expiration prior to the end of its term in the event of the termination of the Participant’s Service. SARs may be granted in combination with Options, and such an SAR Agreement may provide that the SARs will not be exercisable unless the related Options are forfeited.


NORDSTROM, INC. - 2019 Proxy Statement   B-3


7.5Effect of Change in Control. In the event that the Participant experiences a Qualifying Termination within twelve (12) months following a Change in Control then, unless (i) the Committee shall have previously made provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all of such SAR for the cash, securities or property deliverable to the holder of any or all outstanding share-based Awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Company’s Common Stock in connection with the Change in Control, or (ii) the SAR would otherwise continue in accordance with its terms notwithstanding the occurrence of the Change in Control, such SAR shall automatically become fully vested and exercisable. In addition, acceleration of exercisability may be required pursuant to Article 12.
7.6Exercise of SARs. Upon exercise of an SAR, the Participant (or any person having the right to exercise the SAR after his or her death) shall receive from the Company (a) shares of Common Stock, (b) cash or (c) a combination of shares of Common Stock and cash, as the Committee shall determine. The amount of cash and/or the Fair Market Value of shares of Common Stock received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the shares of Common Stock subject to the SARs exceeds the Exercise Price.
7.7Dividend Rights. No dividends or dividend equivalent rights shall be paid or accrued with respect to SARS.
ARTICLE 8Unrestricted Shares
Unrestricted Shares granted under the Plan are subject to the following terms and conditions:
8.1Unrestricted Shares. Unrestricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. In no event shall the number of Unrestricted Shares that are granted to any Participant in a single fiscal year exceed 100,000 shares of Common Stock, subject to adjustment in accordance with Article 12 or together with all other Awards the limits set forth in Section 3.4.
8.2Payment for Awards. Unrestricted Shares may be granted under the Plan for such consideration consisting of any tangible or intangible property or benefit to the Company as the Committee may determine, including cash, services performed and contracts for services to be performed.
ARTICLE 9Restricted Shares
Restricted Shares granted under the Plan are subject to the following terms and conditions:
9.1Restricted Share Agreement. Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Share Agreement between the recipient and the Company. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Share Agreements entered into under the Plan need not be identical. In no event shall the number of Restricted Shares which are granted to any Participant in a single fiscal year exceed 500,000 shares of Common Stock, subject to adjustment in accordance with Article 12.
9.2Payment for Awards. Restricted Shares may be granted under the Plan for such consideration consisting of any tangible or intangible property or benefit to the Company as the Committee may determine, including cash, services performed and contracts for services to be performed.
9.3Vesting Conditions. Each Award of Restricted Shares shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Share Agreement, subject to Section 3.4. The Committee may include among such conditions the requirement that the performance of the Company or a business unit of the Company for a Performance Cycle equal or exceed a target determined in advance by the Committee. Such target shall be based on any one or combination of the Performance Criteria.
If the Participant’s employment with the Company or Subsidiary is terminated before the end of a Performance Cycle for any reason other than Disability, death or Retirement, the Participant shall forfeit all rights with respect to any Restricted Shares that were being earned during the Performance Cycle. The Committee, in its absolute and sole discretion, may establish guidelines providing that if a Participant’s employment is terminated before the end of a Performance Cycle by reason of Disability, death or Retirement, the Participant shall be entitled to a prorated payment with respect to any Restricted Shares that were being earned during the Performance Cycle, as determined at the end of such Performance Cycle. A Restricted Share Agreement may provide for accelerated service-based vesting in the event of the Participant’s Disability, death or Retirement (provided that, with respect to accelerated vesting in the event of Retirement, such Restricted Share Agreement shall comply with the requirements of Code Section 409A and include specific provisions regarding any tax withholding requirements, as required). Notwithstanding the foregoing, in the event that the Participant experiences a Qualifying Termination within twelve (12) months following a Change in Control, then unless (i) the Committee shall have previously made provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all of such Restricted Shares for the cash, securities, or property deliverable to the holder of any or all outstanding share-based Awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Company’s Common Stock in connection with the Change in Control; or (ii) the Restricted Share Agreement would otherwise continue in accordance with its terms notwithstanding the occurrence


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of the Change in Control, such Restricted Shares shall automatically vest upon the date of such Qualifying Termination at such amount as would have been earned if the original payment date(s) of the Restricted Shares had been the date of the Qualifying Termination, or if such payment is indeterminable then one hundred percent (100%) of such Restricted Shares will vest and any restrictions thereon shall lapse at the time of such Change in Control.
9.4Voting and Dividend Rights. The holders of Restricted Shares granted under the Plan shall have the voting, dividend and other rights as set forth in their Restricted Share Agreement, and may have the same voting, dividend and other rights as the Company’s other shareholders. Any dividends paid on Restricted Shares shall not be paid at the dividend payment date and shall only be paid if and when Restricted Shares vest, in cash or in shares of unrestricted Common Stock having a Fair Market Value equal to the amount of such dividends. Common Stock distributed in connection with a stock split or stock dividend, and distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Shares with respect to which such Common Stock has been distributed.
ARTICLE 10Restricted Stock Units
Restricted Stock Units granted under the Plan are subject to the following terms and conditions:
10.1Restricted Stock Units. Restricted Stock Units are designated in shares of Common Stock.
10.2Restricted Stock Unit Agreement. Each grant of Restricted Stock Units under the Plan shall be evidenced by a Restricted Stock Unit Agreement between the recipient and the Company. Such Restricted Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms of the applicable Restricted Stock Unit Agreement that are not inconsistent with the Plan. The provisions of the various Restricted Stock Unit Agreements entered into under the Plan need not be identical. In no event shall the number of Restricted Stock Units which are granted to any Participant in a single fiscal year pertain to more than 500,000 shares of Common Stock, subject to adjustment in accordance with Article 12.
10.3Payment for Awards. To the extent that an Award is granted in the form of Restricted Stock Units, no cash consideration shall be required of the Award recipients.
10.4Vesting Conditions. Each Award of Restricted Stock Units shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Stock Unit Agreement, subject to Section 3.4. The Committee may include among such conditions the requirement that the performance of the Company or a business unit of the Company for a Performance Cycle equal or exceed a target determined in advance by the Committee. Such target shall be based on any one or combination of the Performance Criteria.
If the Participant’s employment with the Company or Subsidiary is terminated before the end of a Performance Cycle for any reason other than Disability, death or Retirement, the Participant shall forfeit all rights with respect to any Restricted Stock Units that were being earned during that Performance Cycle. The Committee, in its absolute and sole discretion, may establish guidelines providing that if a Participant’s employment is terminated before the end of a Performance Cycle by reason of Disability, death or Retirement, the Participant shall be entitled to a prorated payment with respect to any shares of Restricted Stock Units that were being earned during the Performance Cycle, as determined at the end of such Performance Cycle. A Restricted Stock Unit Agreement may provide for accelerated service-based vesting in the event of the Participant’s Disability, death or Retirement (provided that, with respect to accelerated vesting in the event of Retirement, such Restricted Stock Unit Agreement’s accelerated vesting provisions shall comply with the requirements of Code Section 409A). Notwithstanding anything to the contrary contained in the foregoing, in the event that the Participant experiences a Qualifying Termination within twelve (12) months following a Change in Control then unless (i) the Committee shall have previously made provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all of such Restricted Stock Units for the cash, securities, or property deliverable to the holder of any or all outstanding share-based Awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Company’s Common Stock in connection with the Change in Control; or (ii) the award of Restricted Stock Units would otherwise continue in accordance with its terms notwithstanding the occurrence of the Change in Control, such Restricted Stock Units shall automatically vest upon the date of such Qualifying Termination at such amount as would have been earned if the original payment date(s) of the Restricted Stock Units had been the date of the Qualifying Termination, or if such payment is indeterminable then one hundred percent (100%) of such Restricted Stock Units will vest and any restrictions thereon shall lapse at the time of such Change in Control.
10.5Dividend Rights. Shares underlying an Award of Restricted Stock Units shall not be entitled to dividends and shall be entitled to dividend equivalents with respect to such Restricted Stock Units only as set forth under a Restricted Stock Unit Agreement and in compliance with this Section 10.5. If a Restricted Stock Unit Agreement includes rights to dividend equivalents, an amount equal to the dividends that would have been paid if the Restricted Stock Units had been issued and outstanding shares of Common Stock on or before the record date for any declared dividend shall be paid to the holder of such Restricted Stock Units, in cash or stock, subject to applicable withholding taxes, only if and when the Restricted Stock Units vest. Any dividend equivalents payable pursuant to this Section 10.5 shall be paid no later than March 1 of the calendar year after the calendar year in which the underlying Restricted Stock Units vest as provided in the applicable Restricted Stock Unit Agreement.


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10.6Form and Time of Settlement of Restricted Stock Unit Awards. Settlement of vested Restricted Stock Units may be made in the form of (a) cash, (b) shares of Common Stock or (c) any combination of both, as determined by the Committee. For the avoidance of doubt, settlement of vested Restricted Stock Units in shares of Common Stock shall not be considered an Award of Unrestricted Shares under Article 8. Methods of converting Restricted Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of shares of Common Stock over a series of trading days. Vested Restricted Stock Units shall be settled in a lump sum before the later of (i) two and one half (21/2) months after the end of the Company’s fiscal year during which all vesting conditions applicable to the Restricted Stock Units have been satisfied or have lapsed or (ii) March 15 following the calendar year in which all vesting conditions applicable to the Restricted Stock Units have been satisfied or have lapsed. Until an Award of Restricted Stock Units is settled, the number of such Restricted Stock Units shall be subject to adjustment pursuant to Article 12.
10.7Creditors’ Rights. A holder of Restricted Stock Units shall have no rights other than those of a general creditor of the Company. Restricted Stock Units represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Restricted Stock Unit Agreement.
ARTICLE 11Performance Share Units
Performance Share Units granted under the Plan are subject to the following terms and conditions:
11.1Performance Share Units. Performance Share Units are designated in shares of Common Stock.
11.2Agreement. Each grant of Performance Share Units under the Plan shall be evidenced by an Agreement between the recipient and the Company, shall be subject to all applicable terms of the Plan, and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Performance Share Unit Agreements entered into under the Plan need not be identical. Performance Share Units may be granted in consideration of a reduction in the recipient’s other compensation.
11.3Payment for Awards. To the extent that an Award is granted in the form of Performance Share Units, no cash consideration shall be required of the Award recipients.
11.4Vesting Conditions. Each Award of Performance Share Units shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Performance Share Unit Agreement, subject to Section 3.4. The Committee may include among such conditions the requirement that the performance of the Company or a business unit of the Company for a Performance Cycle equal or exceed a target determined in advance by the Committee. Such target shall be based on any one or combination of the Performance Criteria.
In no event shall the number of Performance Share Units which are subject to performance-based vesting conditions and which are granted to any Participant in a single fiscal year exceed 500,000, subject to adjustment in accordance with Article 12.
If the Participant’s employment with the Company or Subsidiary is terminated before the date that Performance Share Units vest, the Participant shall forfeit all rights with respect to any unvested Performance Share Units. However, with respect to Performance Share Units subject to performance-based vesting conditions, the Committee, in its absolute and sole discretion at the time an Award of Performance Share Units is made, may establish guidelines providing that if a Participant’s employment is terminated before the end of a Performance Cycle by reason of Disability, death or Retirement, the Participant shall be entitled to a prorated payment with respect to any Performance Share Units that were being earned during the Performance Cycle, as determined at the end of such Performance Cycle. A Performance Share Unit Agreement may provide for accelerated service-based vesting in the event of a Participant’s Disability, death or Retirement (provided, in the case of Retirement, that such Performance Share Unit Agreement’s accelerated vesting provisions shall comply with the requirements of Code Section 409A). Notwithstanding anything to the contrary contained in the foregoing, in the event that the Participant experiences a Qualifying Termination within twelve (12) months following a Change in Control then unless (i) the Committee shall have previously made provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all of such Performance Share Units for the cash, securities, or property deliverable to the holder of any or all outstanding share-based Awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Company’s Common Stock in connection with the Change in Control; or (ii) the award of Performance Share Units would otherwise continue in accordance with its terms notwithstanding the occurrence of the Change in Control, such Performance Share Units shall automatically vest upon the date of such Qualifying Termination at such amount as would have been earned if the original payment date of the Performance Shares Units had been the date of the Qualifying Termination, or if such payment is indeterminable then one hundred percent (100%) of such Performance Share Units will vest and any restrictions thereon shall lapse at the time of such Change in Control. In addition, acceleration of vesting may be required pursuant to Article 12. 
11.5Dividend Rights. Shares underlying an Award of Performance Share Units shall not be entitled to dividends and shall be entitled to dividend equivalents with respect to such Performance Share Units only as set forth under a Performance Share Unit Agreement and in compliance with this Section 11.5. If a Performance Share Unit Agreement includes rights to dividend equivalents, an amount equal to the dividends that would have been paid if the Performance Share Units had been settled shares of Common Stock on or before the record date for any declared dividend shall be paid to the holder of such Performance Share Units, in cash or stock, subject to applicable withholding taxes, only if and when such Performance Share Units actually vest and are settled in shares of Common Stock. Any dividend equivalents payable pursuant to this Section 11.5 shall be paid no later than March 1 of the calendar year after the calendar year in which the underlying Performance Share Units vest as provided in the applicable Performance Share Unit Agreement.


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11.6Form and Time of Settlement of Units. Settlement of vested Performance Share Units may be made in the form of (a) cash, (b) shares of Common Stock or (c) any combination of both, as determined by the Committee. For the avoidance of doubt, settlement of vested Performance Share Units in shares of Common Stock shall not be considered an Award of Unrestricted Shares under Article 8. Methods of converting Performance Share Units into cash may include (without limitation) a method based on the average Fair Market Value of shares of Common Stock over a series of trading days. Vested Performance Share Units shall be settled in a lump sum by the last day of the calendar year in which all vesting conditions applicable to the Performance Share Units have been satisfied or have lapsed. Until an Award of Performance Share Units is settled, the number of such Share Units shall be subject to adjustment pursuant to Article 12.
11.7Creditors’ Rights. A holder of Performance Share Units shall have no rights other than those of a general creditor of the Company. Performance Share Units represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Performance Share Unit Agreement.
ARTICLE 12Protection Against Dilution
12.1Modification or Assumption of Awards. Except in connection with a corporate transaction involving the Company (a “Strategic Transaction” which shall include, without limitation any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination or exchange of shares or the sale of all or substantially all of the Company’s assets), the terms of outstanding Awards may not be amended to reduce any exercise price associated with such Awards or to cancel any outstanding Awards in exchange for cash, other Awards or other securities with an exercise price that is less than the exercise price of the original Awards without shareholder approval. The foregoing and the provisions of this Article 12 notwithstanding, no modification of an Award shall, without the consent of the Award recipient, alter or impair his or her rights or obligations under such Award.
12.2Adjustments. Upon or in contemplation of any Strategic Transaction, the Committee shall, in such manner, to such extent (if any) and at such time as it deems appropriate and equitable in the circumstances:
(a)    proportionately adjust any or all of (i) the number and type of shares of Common Stock (or other securities) that thereafter may be made the subject of Awards (including the specific share limits, maximums and numbers of shares set forth elsewhere in this Plan), (ii) the number, amount and type of shares of Common Stock (or other securities or property) subject to any or all outstanding Awards, (iii) the grant, purchase, or exercise price of any or all outstanding Awards, (iv) the securities, cash or other property deliverable upon exercise of any or all outstanding Awards, or (v) the performance standards appropriate to any or all outstanding Awards, or
(b)    make provision for a cash payment or for the assumption, substitution or exchange of any or all outstanding share-based Awards or the cash, securities or property deliverable to the holder of any or all outstanding share-based Awards, based upon the distribution or consideration payable to holders of the outstanding shares of Common Stock upon or in respect of such event.
For the avoidance of doubt, this Article 12 does not apply to normal cash dividends with respect to Company Stock other than extraordinary dividends or to stock issued in lieu of such dividends. The Committee may adopt such valuation methodologies for outstanding Awards as it deems reasonable in the event of a cash or property settlement and, in the case of Options, SARs or similar rights, but without limitation on other methodologies, may base such settlement solely upon the excess, if any, of the per share amount payable upon or in respect of such event over the grant price of the Award, unless otherwise provided in, or by authorized amendment to, the Award or provided in another applicable agreement with the Participant. With respect to any ISO, in the absolute and sole discretion of the Committee, the adjustment may be made in a manner that would cause the Option to cease to qualify as an ISO.
12.3Dissolution or Liquidation. To the extent not previously exercised, settled or assumed, Options, SARs, and Performance Share Units shall terminate immediately prior to the dissolution or liquidation of the Company.
ARTICLE 13Awards Under Other Plans
The Company may grant Awards under other equity plans or programs. Such Awards may be settled in the form of shares of Common Stock issued under this Plan.
ARTICLE 14Limitation on Rights
14.1Retention Rights. Neither the Plan nor any Award granted under the Plan shall be deemed to give any individual a right to remain an Employee or Nonemployee Director. The Company and its Subsidiaries reserve the right to terminate the Service of any Employee or Nonemployee Director at any time, with or without cause, subject to applicable laws, the Company’s Restated Articles of Incorporation and Bylaws and a written employment agreement (if any).


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14.2Shareholders’ Rights. Unless otherwise provided in this Plan or in any Award, a Participant shall have no dividend rights, voting rights or other rights as a shareholder with respect to any shares of Common Stock covered by his or her Award prior to the time when a stock certificate for such shares of Common Stock is issued or, if applicable, the time when he or she becomes entitled to receive such shares of Common Stock by filing any required notice of exercise and paying any required Exercise Price. No adjustment shall be made for normal cash dividends or other rights for which the record date is prior to such time, except as expressly provided in the Plan.
14.3Regulatory Requirements. Any other provision of the Plan notwithstanding, the obligation of the Company to issue shares of Common Stock under the Plan shall be subject to all applicable laws, rules and regulations and such approval by any regulatory body as may be required. The Company reserves the right to restrict, in whole or in part, the delivery of shares of Common Stock pursuant to any Award prior to the satisfaction of all legal requirements relating to the issuance of such shares of Common Stock related to their registration, qualification or listing or to an exemption from registration, qualification or listing.
14.4Compliance with Code Section 409A. Awards under the Plan are intended to comply with Code Section 409A and all Awards shall be interpreted in a manner that results in compliance with Section 409A, Department of Treasury regulations, and other interpretive guidance under Section 409A. Notwithstanding any provision of the Plan or an Award to the contrary, if the Committee determines that any Award does not comply with Code Section 409A, the Company may adopt such amendments to the Plan and the affected Award (without consent of the Participant) or adopt other policies or procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary and appropriate to (a) exempt the Plan and the Award from application of Code Section 409A and/or preserve the intended tax treatment of amounts payable with respect to the Award, or (b) comply with the requirements of Code Section 409A.
14.5Clawback Policy. Each award issued under the Plan is subject to the Company’s clawback policy, which is amended from time to time.
14.6Transferability. Except in the context of death of a Participant, or as otherwise required by law, or as approved by the Committee for no consideration, Awards issued under the Plan may not be transferred to any third party.
14.7Governing Law. The Plan shall be governed by, and construed in accordance with, the laws of the State of Washington, without giving effect to any conflicts of laws principles.
ARTICLE 15Withholding Taxes
15.1General. To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor shall make arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Company shall not be required to issue any shares of Common Stock or make any cash payment under the Plan until such obligations are satisfied.
15.2Share Withholding. To the extent that applicable law subjects a Participant to tax withholding obligations, the Committee may permit such Participant to satisfy all or part of such obligations by having the Company withhold all or a portion of any shares of Common Stock that otherwise would be issued to him or her or by surrendering all or a portion of any shares of Common Stock that he or she previously acquired. Such shares of Common Stock shall be valued at their Fair Market Value on the date when they are withheld or surrendered, and shall be deemed to have been issued for purposes of identifying any shares which may become available for grant pursuant to Section 3.3 above.
ARTICLE 16Future of the Plan
16.1Term of the Plan. The Plan, as set forth herein, became effective on the date of shareholder approval, May 23, 2019, and shall remain in effect for a period of ten (10) years unless earlier terminated under Section 16.2.
16.2Amendment or Termination. The Board may, at any time and for any reason, amend, alter or terminate the Plan. Notwithstanding the foregoing and except as provided in Section 14.4, no amendment, alteration or termination shall be made that would impair the rights of a Participant under any Award theretofore granted without such Participant’s express written consent. An amendment of the Plan shall be subject to the approval of the Company’s shareholders for any amendment that would (a) require shareholder approval in order to satisfy the applicable requirements of Code section 422, or other applicable laws, regulations or rules, including but not limited to any stock exchange rules; (b) increase amounts payable under the Plan to Participants (provided that shareholder approval shall not be required for increases that are not material and do not require such approval under applicable law or stock exchange rules); (c) increase the number of shares of Common Stock authorized to be issued under the Plan; (d) permit the repurchase by the Company of any outstanding Awards with an Exercise Price greater than the then-current Fair Market Value of Common Stock; or (e) modify the Plan’s eligibility provisions. No Awards shall be granted under the Plan after the termination thereof.


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ARTICLE 17Definitions
17.1    “Award” means any grant of an Option, an SAR, an Unrestricted Share, a Restricted Share, a Restricted Stock Unit or a Performance Share Unit under the Plan.
17.2    “Award Agreement” means the written agreement between the Company and the recipient that contains the terms, conditions and restrictions pertaining to a particular Award.
17.3    “Board” means the Company’s Board of Directors, as constituted from time to time.
17.4    “Cause” means (a) the unauthorized use or disclosure of the confidential information or trade secrets of the Company, which use or disclosure causes material harm to the Company, (b) conviction of, or a plea of “guilty” or “no contest” to, a felony under the laws of the United States or any State thereof, (c) gross negligence, (d) willful misconduct or (e) a failure to perform assigned duties that continues after the Participant has received written notice of such failure. The foregoing, however, shall not be deemed an exclusive list of all acts or omissions that the Company (or the Parent or Subsidiary employing the Participant) may consider as grounds for the discharge of the Participant without Cause.
17.5    “Change in Control” means the happening of any of the following:
(a)    the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not shareholders of the Company immediately prior to such merger, consolidation or other reorganization own immediately after such merger, consolidation or other reorganization in excess of fifty percent (50%) of the voting power of the outstanding securities of each of (i) the continuing or surviving entity and (ii) any direct or indirect parent corporation of such continuing or surviving entity;
(b)    the sale, transfer or other disposition of all or substantially all of the Company’s assets;
(c)    a change in the composition of the Board as a result of which fewer than fifty percent (50%) of the incumbent Directors are Directors who either (i) had been Directors of the Company on the date twenty-four (24) months prior to the date of the event that may constitute a Change in Control (the “original Directors”) or (ii) were elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the aggregate of the original Directors who were still in office at the time of the election or nomination and the Directors whose election or nomination was previously so approved, but excluding, for this purpose, any such Director whose initial assumption of office occurs as a result of either an actual or threatened election contest or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board of Directors, including by reason of agreement intended to avoid or settle any such actual or threatened contest or solicitation; or
(d)    any transaction as a result of which any person is the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing at least thirty percent (30%) of the total voting power represented by the Company’s then outstanding voting securities. For purposes of this Paragraph (d), the term “person” shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude (i) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or of a Subsidiary and (ii) a corporation owned directly or indirectly by the shareholders of the Company in substantially the same proportions as their ownership of the common stock of the Company.
A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.
17.6    “Code” means the Internal Revenue Code of 1986, as amended.
17.7    “Committee” means the Compensation Committee of the Company’s Board.
17.8    “Common Stock” means shares of the common stock of the Company.
17.9    “Company” means Nordstrom, Inc., a Washington corporation.
17.10    “Disability” means the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months.
17.11    “Employee” means a common-law employee of the Company, a Parent or a Subsidiary.
17.12    “Exchange Act” means the Securities Exchange Act of 1934, as amended.
17.13    “Exercise Price,” in the case of an Option, means the amount for which one share of Common Stock may be purchased upon exercise of such Option, as specified in the applicable Stock Option Agreement. “Exercise Price,” in the case of an SAR, means an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value of one share of Common Stock in determining the amount payable upon exercise of such SAR.


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17.14    “Fair Market Value” means the market price of a share of Common Stock, determined by the Committee in good faith on such basis as it deems appropriate. Whenever possible, the determination of Fair Market Value by the Committee shall be based on the closing price on the date of the Award as reported by the New York Stock Exchange, or the primary exchange or quotation system on which the Common Stock is then trading. Such determination shall be conclusive and binding on all persons.
17.15    “Good Reason” means the occurrence of one or more of the following without the Participant’s express written consent and within twelve (12) months following a Change in Control:
(a)    a material diminution in the Participant’s base salary;
(b)    a material diminution in the Participant’s authority, duties, or responsibilities;
(c)    a material change in the geographic location at which the Participant must perform his or her services to a place that is more than fifty (50) miles from where the Participant was based immediately prior to the Change in Control; and
(d)    any other action or inaction that constitutes a material breach by the Company of this Plan with respect to a Participant’s Award.
The event or events described above shall constitute Good Reason only if the Company (or the Parent or Subsidiary employing the Participant) fails to cure such event or events within ninety (90) days after receipt from the Participant of written notice of the event or events which constitutes Good Reason. Such notice must be provided to the Company (or the Parent or Subsidiary employing the Participant) and must provide a reasonably detailed description of the facts that the Participant believes constitute a Good Reason event. Good Reason shall cease to exist for an event on the ninetieth (90th) day following the later of its occurrence or the Participant’s knowledge thereof, unless the Participant has given written notice to the Company thereof prior to such date.
17.16    “ISO” means an incentive stock option described in Section 422(b) of the Code.
17.17    “Net Exercise” means in lieu of exercising an Option for cash, the Optionee may elect to receive shares equal to the value of the Option (or the portion thereof being exercised) by surrender of the Option. The Company shall issue to such Optionee a number of shares of Common Stock computed using the following formula:
X = Y (A - B)
A
Where
X =    The number of shares to be issued to the Optionee pursuant to the Net Exercise.
Y =    The number of shares purchasable under this Option or, if only a portion of the Option is being exercised, the portion of the Option being cancelled (at the date of such calculation).
A =    The fair market value of one (1) share (at the date of such calculation).
B =    The Exercise Price (as adjusted to the date of such calculations).
17.18    “NSO” means a stock option not described in Sections 422 or 423 of the Code.
17.19    “Nonemployee Director” means a member of the Company’s Board or the Board of Directors of a Subsidiary who is not an Employee. Service as a Nonemployee Director shall be considered employment for all purposes of the Plan, except as provided in Section 4.2.
17.20    “Option” means an NSO or an ISO granted under Article 5 of the Plan and entitling the holder to purchase shares of Common Stock pursuant to an Award.
17.21    “Optionee” means an individual or estate who holds an Option.
17.22    “Participant” means an individual or estate who holds an Award.
17.23    “Performance Criteria” shall mean a specified percentage or quantitative level in one or more of the following performance measures:
(a)    the Company’s shareholder return as compared with any designated industry or other comparator group;
(b)     the trading price of the Company’s common stock;
(c)    the results of operations, such as sales, earnings, net income (before or after taxes), cash flow, return on assets, same-store sales, economic profit, or return on investment (including return on equity, return on capital employed, or return on assets);


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(d)    earnings before or after taxes, interest, depreciation and/or amortization, and including /excluding capital gains and losses;
(e)    other financial results, such as profit margins, operational efficiency, expense reduction, or asset management goals; and
(f)    the internal or external market share of a product or line of products.
Each of the foregoing performance measures may be based on the performance of the Company generally, in the absolute or in relation to its peers, or the performance of a particular Participant, department, business unit, subsidiary, or other segment to which a particular Participant is assigned. The Committee may establish different performance measures and milestones for individual Participants or groups of Participants. For each Participant, each performance measure will be weighted to reflect its relative significance to the Company for the Performance Cycle.
Except as otherwise specified in an individual Award, applicable performance measures shall be adjusted to exclude the following items that occur during a given Performance Cycle:
(i)    Extraordinary, unusual or non-recurring items of gain or loss;
(ii)    Gains or losses on the disposition of a business, a segment of a business, or significant assets outside the ordinary course of business;
(iii)    Changes in tax or accounting standards, principles, regulations or laws;
(iv)    The effect of a merger or acquisition, including all financial results derived therefrom during the period from the merger or acquisition date through the end of the Performance Cycle in which the merger or acquisition occurred;
(v)    Gains or losses due to non-cash adjustments which relate to the valuation of long-term assets rather than current-year performance (including but not necessarily limited to gain or loss recognized for store closures, lease terminations, pension adjustments and mark to market adjustments); and
(vi)     The impact of other similar occurrences outside of the Company’s core, on-going business activities (including but not necessarily limited to litigation or tax reserves, financing activities, foreign exchange rate fluctuations and restructuring charges).
In all other respects, performance measures comprising Performance Criteria for an Award shall be calculated in accordance with the Company’s financial statements, under generally accepted accounting principles (GAAP), or under a non-GAAP methodology established by the Committee prior to the issuance of an Award. The method of calculating performance measurements shall be consistently applied and identified in the audited financial statements, including footnotes, or the Compensation Discussion and Analysis section of the Company’s annual report.
17.24    “Performance Cycle” means a predetermined period of time, not less than one year, over which Performance Criteria will be measured with respect to an Award
17.25    “Performance Share Unit” means a bookkeeping entry representing the equivalent of one (1) share of Common Stock, as granted under the Plan pursuant to an Award.
17.26    “Performance Share Unit Agreement” means the written agreement between the Company and the recipient of a Performance Share Unit that contains the terms, conditions and restrictions pertaining to such Performance Share Unit.
17.27     “Plan” means this Nordstrom, Inc. 2019 Equity Incentive Plan, as amended from time to time.
17.28    “Prior Plans” mean the Nordstrom 2010 Equity Incentive Plan and 2004 Equity Incentive Plan, as subsequently amended in 2007 and 2008.
17.29    “Qualifying Termination” means (a) the Participant’s employment is involuntarily terminated by the Company (or the Parent or Subsidiary employing the Participant) without Cause, or (b) the Participant terminates employment from the Company (or the Parent or Subsidiary employing the Participant) for Good Reason. The twelve-month period will be extended by one (1) additional month if the thirty-day cure period in Section 17.15 is triggered in the eleventh or twelfth month following a Change in Control. It is intended that any Qualifying Termination shall be an “involuntary Separation from Service,” as that term is defined in Treasury Regulation Section 1.409A-1(n).
17.30    “Restricted Share” means a share of Common Stock granted under Article 9 pursuant to an Award, with such restrictions as set forth in the applicable Restricted Share Agreement.
17.31    “Restricted Stock Unit” means a right granted under Article 10 to receive Common Stock or cash at the end of a specified deferral period pursuant to an Award, which right may be conditioned on the satisfaction of certain requirements (including the satisfaction of certain performance goals).
17.32    “Restricted Share Agreement” means the written agreement between the Company and the recipient of a Restricted Share that contains the terms, conditions and restrictions pertaining to such Restricted Share.


NORDSTROM, INC. - 2019 Proxy Statement   B-11


17.33    “Restricted Stock Unit Agreement” means the written agreement between the Company and the recipient of a Restricted Stock Unit that contains the terms, conditions and restrictions pertaining to such Restricted Stock Unit.
17.34    “Retirement” means Participant’s termination from Service on or after his or her Retirement Date.
17.35    “Retirement Date” shall have the meaning as set forth in a particular Award Agreement.
17.36    “SAR” means a stock appreciation right granted under Article 7 of the Plan pursuant to an Award.
17.37    “SAR Agreement” means the written agreement between the Company and a Participant that contains the terms, conditions and restrictions pertaining to his or her SAR.
17.38    “Service” means service as an Employee or Nonemployee Director.
17.39    “Stock Option Agreement” means the written agreement between the Company and an Optionee that contains the terms, conditions and restrictions pertaining to his or her Option.
17.40    “Subcommittee” means a separate committee established by and consisting of members of the Committee.
17.41    “Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.
17.42    “Unrestricted Share” means a share of Common Stock granted under Article 8 of the Plan pursuant to an Award.
IN WITNESS WHEREOF, this instrument setting forth the terms and conditions of this NORDSTROM, INC. 2019 EQUITY INCENTIVE PLAN is executed this _________ day of June 2019.
NORDSTROM, INC.
By:
Christine Deputy
Title:Chief Human Resources Officer


B-12 NORDSTROM, INC. - 2019 Proxy Statement 


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