<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
Nordstrom, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
---------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------
(5) Total fee paid:
---------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
[NORDSTROM LOGO]
March 31, 1999
DEAR SHAREHOLDERS:
On behalf of the Board of Directors and management, I cordially invite you to
attend the Annual Meeting of Shareholders on Tuesday, May 18, 1999, at 11:00
a.m., Pacific Daylight Time, in the John W. Nordstrom Room, Downtown Seattle
Nordstrom, 1617 Sixth Avenue, Seattle, Washington, 98101-1742.
In addition to the matters described in the Notice of Annual Meeting and Proxy
Statement, there will be a report on the progress of the Company and an
opportunity to ask questions of general interest to you as a Shareholder.
YOUR VOTE IS VERY IMPORTANT. Therefore, whether or not you plan to attend the
meeting in person, please sign and return the enclosed Proxy in the envelope
provided. If you attend the meeting and desire to vote in person, you may do so
even though you have previously sent your Proxy.
I hope you will be able to join us and we look forward to seeing you in Seattle.
Sincerely yours,
/s/ JOHN J. WHITACRE
John J. Whitacre
Chairman of the Board of Directors
<PAGE> 3
NORDSTROM, INC.
1617 SIXTH AVENUE
SEATTLE, WASHINGTON
98101-1742
NOTICE OF ANNUAL
MEETING OF
SHAREHOLDERS To the Shareholders of Nordstrom, Inc.:
The Annual Meeting of Shareholders of Nordstrom, Inc. will
be held on Tuesday, May 18, 1999, at 11:00 a.m., Pacific
Daylight Time, in the John W. Nordstrom Room, Downtown
Seattle Nordstrom, 1617 Sixth Avenue, Seattle, Washington,
98101-1742 for the following purposes:
1. To elect 11 directors to hold office until the next
Annual Meeting of Shareholders and until their successors
are duly elected and qualified;
2. To ratify the appointment of auditors; and
3. To transact such other business as may properly come
before the meeting and any adjournment thereof.
Holders of shares of Common Stock of record at the close
of business on March 19, 1999 are entitled to notice of,
and to vote at, the meeting.
Shareholders are cordially invited to attend the meeting
in person.
By order of the Board of Directors,
/s/ N. CLAIRE STACK
N. Claire Stack
Secretary
Seattle, Washington
March 31, 1999
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE
MEETING, YOU ARE URGED TO SIGN AND DATE THE ENCLOSED
PROXY AND RETURN IT PROMPTLY IN THE ENVELOPE
PROVIDED.
1
<PAGE> 4
PROXY STATEMENT
APPROXIMATE
MAILING DATE:
MARCH 31, 1999 This Proxy Statement is furnished to the Shareholders of
Nordstrom, Inc. (the "Company") in connection with the
solicitation of proxies by the Board of Directors for use
at the Annual Meeting of Shareholders to be held on May
18, 1999 and any adjournment thereof. If the enclosed
Proxy is executed and returned, it will be voted in
accordance with the instructions given, but may be revoked
at any time insofar as it has not been exercised by
notifying the Secretary of the Company in writing (such
notification to be directed to the Company's offices at
1617 Sixth Avenue, Seattle, Washington, 98101-1742). Each
Proxy will be voted for Proposals 1 and 2, and may be
voted on such other matters as may properly come before
the meeting if no contrary instruction is indicated on the
Proxy.
There were 142,200,328 shares of Common Stock, the only
security of the Company entitled to vote at the meeting,
outstanding as of March 19, 1999, which is the record date
for the Annual Meeting of Shareholders. Shareholders are
entitled to one vote for each share of Common Stock held
of record at the close of business on March 19, 1999.
Under Washington law and the Company's Articles of
Incorporation, a quorum consisting of a majority of the
shares eligible to vote must be represented in person or
by proxy to elect directors and to transact any other
business that may properly come before the meeting. For
election of directors, the nominees elected will be those
receiving the greatest number of votes cast by the shares
entitled to vote, up to the number of directors to be
elected. Any action other than a vote for a nominee will
have the effect of voting against the nominee. The
appointment of auditors will be ratified if the votes cast
in favor of the proposal exceed the votes cast against it.
Abstentions and nonvotes by brokers will have no effect
since such actions do not represent votes cast by
Shareholders.
2
<PAGE> 5
<TABLE>
<S> <C>
SECURITY OWNERSHIP OF The following table sets forth, as of March 19, 1999, the
CERTAIN BENEFICIAL number of shares of Common Stock held by beneficial owners
OWNERS AND of more than five percent of the Company's Common Stock, by
MANAGEMENT directors and nominees, by the executive officers named in
the Summary Compensation Table on page 9, and by all
directors and executive officers of the Company as a group:
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Amount and
Nature of
Beneficial Percent
Name of Beneficial Owner Ownership of Class
<S> <C> <C>
- --------------------------------------------------------------------------------------------
DODGE & COX 10,132,364(a) 6.98%
One Sansome St., 35th Floor
San Francisco, California 94101
FMR CORP. 12,007,422(b) 8.28%
82 Devonshire Street
Boston, Massachusetts 02109-3614
D. WAYNE GITTINGER 10,495,633(c)(d) 7.23%
1420 Fifth Avenue, Suite 4100
Seattle, Washington 98101
ENRIQUE HERNANDEZ, JR. 728 *
ANN D. MCLAUGHLIN 4,806 *
JOHN A. MCMILLAN 1,598,854(c)(e) 1.10%
BRUCE A. NORDSTROM 10,798,386(c)(f) 7.44%
1617 Sixth Avenue
Seattle, Washington 98101-1742
ELMER AND KATHARINE NORDSTROM FAMILY INTERESTS, L.P. 12,476,552(g) 8.60%
c/o 1617 Sixth Avenue
Seattle, Washington 98101-1742
JOHN N. NORDSTROM 3,918,282(c)(h) 2.70%
ALFRED E. OSBORNE, JR. 6,506(i) *
WILLIAM D. RUCKELSHAUS 14,806 *
ELIZABETH CROWNHART VAUGHAN 2,808 *
JOHN J. WHITACRE 82,369(j) *
BRUCE G. WILLISON 4,294(k) *
BLAKE W. NORDSTROM 955,066(l) *
ERIK B. NORDSTROM 958,537(m) *
J. DANIEL NORDSTROM 1,750,305(n) 1.21%
JAMES A. NORDSTROM 3,351,440(o) 2.31%
PETER E. NORDSTROM 965,905(p) *
WILLIAM E. NORDSTROM 1,597,681(q) 1.10%
MICHAEL A. STEIN 183,964(r) *
MARTHA S. WIKSTROM 52,006(s) *
Directors and executive officers as a group (26 persons) 45,541,386(t) 31.39%
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
* Does not exceed 1% of the Company's outstanding Common Stock.
3
<PAGE> 6
(a) Based on an amended Schedule 13G filed pursuant to the Securities Exchange
Act of 1934 (the "1934 Act"), which indicates that Dodge & Cox has sole
dispositive power with respect to all of these shares, sole voting power with
respect to 9,021,964 shares, and shared voting power with respect to 130,400
shares.
(b) Based on a Schedule 13G filed pursuant to the 1934 Act. A number of entities
and individuals, through its or their control of FMR, Corp., also may be deemed
beneficial owners of these shares.
(c) Does not include 160,000 shares held by a corporation, of which the director
or his spouse owns a one-eighth beneficial interest.
(d) Includes 6,940,424 shares held by his wife individually; 659 shares held by
her as a participant in the Company's 401(k) Plan; 777,600 shares held by a
trust, of which she is a trustee and beneficiary; and 2,750,760 shares held by a
trust, of which she is the beneficiary. Does not include 206,896 shares held by
trusts, of which he is a trustee.
(e) Includes 1,224,228 shares held by his wife individually; and 108,000 shares
held by a trust, of which his wife is the beneficiary.
(f) Includes 73,388 shares held by his wife individually; and 4,235,280 shares
held by trusts, of which he is a trustee and beneficiary. Does not include
3,494,964 shares held by trusts, of which he is co-trustee.
(g) The general partners of this partnership are Katharine J. Nordstrom, The
Elected Marital Trust under the Will of Elmer J. Nordstrom (John N. Nordstrom,
trustee), the James F. Nordstrom Interests, L.P., and the John N. Nordstrom
Interests, L.P. The general partners of the James F. Nordstrom Interests, L.P.
are Sally A. Nordstrom, the Estate of James F. Nordstrom (Sally A. Nordstrom,
personal representative), J. Daniel Nordstrom and William E. Nordstrom, and the
general partners of the John N. Nordstrom Interests, L.P. are John N. Nordstrom,
Sally B. Nordstrom, and James A. Nordstrom. Each of these entities and
individuals are deemed to beneficially own the shares held by the Elmer and
Katharine Nordstrom Family Interests, L.P. Each of the general partners disclaim
beneficial ownership of the shares held by the Elmer and Katharine Nordstrom
Family Interests, L.P. that exceed the greater of their proportionate interest
in their respective profits or capital account in the partnerships.
(h) Includes 161,610 shares held by his wife; 4,012 shares held by trusts, of
which he is the trustee; and 2,780,000 shares held by the John N. Nordstrom
Interests, L.P., of which he is a general partner. John N. Nordstrom disclaims
beneficial ownership of the shares held by the John N. Nordstrom Interests, L.P.
that exceed the greater of his proportionate interest in his profits or capital
account in the partnership. Does not include any of the shares held by the Elmer
and Katharine Nordstrom Family Interests, L.P., of which he is deemed a
beneficial owner.
(i) Includes 600 shares held by his wife; and 400 shares held by a corporation,
of which he is the sole shareholder.
(j) Includes 71,571 shares, which may be acquired under the 1987 and 1997 Stock
Option Plans; and 6,796 shares held by him as a participant in the Company's
401(k) Plan.
(k) Represents shares held by a trust, of which he and his spouse are trustees
and beneficiaries.
(l) Includes 16,474 shares held by his wife individually; 19,378 shares held by
trusts, of which he is a trustee; 65,507 shares which may be acquired under the
1987 and 1997 Stock Option Plans; and 1,329 shares held by him in the Company's
401(k) Plan.
(m) Includes 12,390 shares held by his wife individually; 16,464 shares held by
trusts, of which he is a trustee; 44,738 shares, which may be acquired under the
1987 and 1997 Stock Option Plans; and 5,607 shares held by him in the Company's
401(k) Plan.
(n) Includes 12,086 shares held by his wife and children; 12,128 shares held by
trusts, of which he is a trustee; 42,691 shares, which may be acquired under the
1987 and 1997 Stock Option Plans; and
4
<PAGE> 7
1,330,000 shares held by the James F. Nordstrom Interests, L.P., of which he is
a general partner. J. Daniel Nordstrom disclaims beneficial ownership of the
shares held by the James F. Nordstrom Interests, L.P. that exceed the greater of
his proportionate interest in his profits or capital account in the partnership.
Does not include any of the shares held by the Elmer and Katharine Nordstrom
Family Interests, L.P., of which he is deemed a beneficial owner.
(o) Includes 2,458 shares held by his wife individually; 3,128 shares held by
trusts, of which he is a trustee; 59,607 shares, which may be acquired under the
1987 and 1997 Stock Option Plans; and 2,780,000 shares held by the John N.
Nordstrom Interests, L.P., of which he is a general partner. James A. Nordstrom
disclaims beneficial ownership of the shares held by the John N. Nordstrom
Interests, L.P. that exceed the greater of his proportionate interest in his
profits or capital account in the partnership. Does not include any of the
shares held by the Elmer and Katharine Nordstrom Family Interests, L.P., of
which he is deemed a beneficial owner.
(p) Includes 54,637 shares, which may be acquired under the 1987 and 1997 Stock
Option Plans; and 5,718 shares held by him in the Company's 401(k) Plan.
(q) Includes 11,244 shares held by trusts, of which he is a trustee; and 45,627
shares, which may be acquired under the 1987 and 1997 Stock Option Plans; and
1,330,000 shares held by the James F. Nordstrom Interests, L.P., of which he is
a general partner. William E. Nordstrom disclaims beneficial ownership of the
shares held by the James F. Nordstrom Interests, L.P. that exceed the greater of
his proportionate interest in his profits or capital account in the partnership.
Does not include any of the shares held by the Elmer and Katharine Nordstrom
Family Interests, L.P., of which he is deemed a beneficial owner.
(r) Represents 180,000 shares of restricted stock granted to Michael A. Stein on
October 15, 1998; and 3,964 shares, which may be acquired under the 1997 Stock
Option Plan.
(s) Represents 50,415 shares, which may be acquired under the 1987 and 1997
Stock Option Plans; and 1,589 shares held by her in the Company's 401(k) Plan.
(t) Includes the 12,476,552 shares held by the Elmer and Katharine Nordstrom
Family Interests, L.P. Also includes the 1,330,000 shares held by the James F.
Nordstrom Interests, L.P. and the 2,780,000 shares held by the John N. Nordstrom
Interests, L.P.
The directors and executive officers shown in the table disclaim beneficial
interest in any shares held solely as custodian or trustee, and all shares held
by their spouses and immediate family members.
5
<PAGE> 8
PROPOSAL 1:
ELECTION OF DIRECTORS Eleven directors will be elected at the Annual Meeting of
Shareholders, each to hold office until the next Annual
Meeting of Shareholders and until a successor has been
duly elected and qualified. Unless otherwise instructed by
the Shareholder, the persons named in the enclosed Proxy
intend to vote for the election of the persons listed in
this Proxy Statement. All of the nominees are currently
directors of the Company. If any nominee becomes
unavailable for any reason or should a vacancy occur
before the election, which events are not anticipated, the
Proxy may be voted for a person to be selected by the
Board of Directors of the Company.
NOMINEES
Information related to the director nominees is set forth
below:
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
- -------------------------------------------------------------------------------------------------------
<CAPTION>
Principal Occupation and Business Director
Name and Age Experience for Past Five Years Since
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
D. WAYNE GITTINGER Partner in the law firm of Lane Powell Spears Lubersky 1971
Age 66(a)(b) LLP
ENRIQUE HERNANDEZ, JR. President and Chief Executive Officer of Inter-Con 1997
Age 43(c) Security Systems, Inc., a California-based worldwide
security and facility support services provider;
co-founder and principal partner, Interspan
Communications, a television broadcasting company
serving Spanish-speaking audiences
ANN D. MCLAUGHLIN Chairman of the Aspen Institute, Washington, D.C. and 1992
Age 57(d) Aspen, Colorado, an international, nonprofit,
educational and public policy organization dedicated
to serving leaders throughout the world (formerly
Vice Chairman of the Aspen Institute; President of
the Federal City Council; President and Chief
Executive Officer of New American Schools
Development Corporation; Visiting Fellow of the
Urban Institute)
JOHN A. MCMILLAN Retired (formerly Co-Chairman of the Board of 1966
Age 67(b)(e) Directors of the Company)
BRUCE A. NORDSTROM Retired (formerly Co-Chairman of the Board of 1966
Age 65(b) Directors of the Company)
JOHN N. NORDSTROM Retired (formerly Co-Chairman of the Board of 1966
Age 61(b) Directors of the Company)
ALFRED E. OSBORNE, JR. Director of the Harold Price Center for 1987
Age 54(f) Entrepreneurial Studies and Associate Professor of
Business Economics, The Anderson School at UCLA
</TABLE>
6
<PAGE> 9
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
- -------------------------------------------------------------------------------------------------------
<CAPTION>
Principal Occupation and Business Director
Name and Age Experience for Past Five Years Since
- -------------------------------------------------------------------------------------------------------
<S> <C> <C>
WILLIAM D. RUCKELSHAUS A Principal in Madrona Investment Group, L.L.C., a 1985
Age 66(g) Washington-based private investment firm (formerly
Chairman and Chief Executive Officer of
Browning-Ferris Industries, Inc.)
ELIZABETH CROWNHART VAUGHAN President of Salar Enterprises, Ltd., an Oregon-based 1977
Age 70 company engaged in the production of historical
materials
JOHN J. WHITACRE Chairman of the Board of Directors of the Company 1995
Age 46 (formerly Co-Chairman of the Board of Directors of
the Company; Co-President of the Company)
BRUCE G. WILLISON Retired, formerly President and Chief Operating 1998
Age 50(h) Officer of H.F. Ahmanson & Company, a
California-headquartered thrift holding company and
Home Savings of America, a full-service consumer
bank, also headquartered in California. H.F.
Ahmanson is the parent company of Home Savings of
America
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
(a) Mr. Gittinger is a partner in the law firm of Lane Powell Spears Lubersky
LLP, which rendered legal services to the Company during the 1998 fiscal year.
(b) Bruce A. Nordstrom is a brother-in-law of D. Wayne Gittinger and a cousin of
John N. Nordstrom. John A. McMillan is a cousin of all three by marriage. Mr.
Bruce A. Nordstrom's sons are Blake W. Nordstrom, Erik B. Nordstrom, and Peter
E. Nordstrom, all of whom are Co-Presidents of the Company. Mr. John N.
Nordstrom's son, James A. Nordstrom, and nephews, J. Daniel Nordstrom and
William E. Nordstrom, who are brothers, are also Co-Presidents of the Company.
(c) Mr. Hernandez is also a director of California Healthcare Foundation, ICSS
Holding Corp., McDonald's Corporation, and Washington Mutual, Inc.
(d) Ms. McLaughlin, a former U.S. Secretary of Labor, is also a director of AMR
Corporation, Donna Karan International, Fannie Mae, General Motors Corporation,
Harman International Industries, Inc., Host Marriott Corporation, Kellogg
Company, Union Camp Corporation, and Vulcan Materials Company.
(e) Mr. McMillan is also a director of the Follett Company and Plenum
Communications.
(f) Dr. Osborne is also a director of The Times Mirror Company, and United
States Filter Corporation, and is also a trustee of the W. M. Group of Funds,
and the Worldwide Index Fund, and an independent general partner of Technology
Funding Venture Partners V.
(g) Mr. Ruckelshaus is also a director of Browning-Ferris Industries, Inc.
(Chairman of the Board), Coinstar, Inc., Cummins Engine Company, Monsanto
Company, Solutia Inc., and Weyerhaeuser Company. He was also a director of the
Company from 1978 to 1983.
(h) Mr. Willison is also a director of Housing and Commercial Bank, Korea, the
Los Angeles Urban League, the United Way of Greater Los Angeles, and the Los
Angeles Sports Council.
The Board of Directors recommends a vote for each of the nominees listed in the
table.
7
<PAGE> 10
BOARD OF DIRECTORS
AND COMMITTEES The Board of Directors maintains an Audit Committee, a
Compensation and Stock Option Committee, and a Corporate
Governance and Nominating Committee. These committees do
not have formal meeting schedules, but are required to
meet at least once each year. During the past year, there
were four meetings of the Board of Directors, four
meetings of the Audit Committee, five meetings of the
Compensation and Stock Option Committee, and four meetings
of the Corporate Governance and Nominating Committee.
Current members of the Audit Committee are Ann D.
McLaughlin, Chair, Enrique Hernandez, Jr., Alfred E.
Osborne, Jr., William D. Ruckelshaus, Elizabeth Crownhart
Vaughan, and Bruce G. Willison. The Audit Committee is
responsible for recommending the Company's independent
auditors. This Committee meets periodically with the
independent auditors, as well as with management and the
internal auditors, to review accounting, auditing,
internal accounting controls, and financial reporting
matters. The independent auditors and the internal
auditors also meet privately with the Audit Committee.
Current members of the Compensation and Stock Option
Committee are William D. Ruckelshaus, Chair, D. Wayne
Gittinger, Ann D. McLaughlin, John A. McMillan, Alfred E.
Osborne, Jr., and Elizabeth Crownhart Vaughan. The
Compensation and Stock Option Committee is responsible for
determining the overall compensation levels of certain of
the Company's executive officers and administering the
Company's stock option plans.
Current members of the Corporate Governance and Nominating
Committee are D. Wayne Gittinger, Chair, Ann D.
McLaughlin, William D. Ruckelshaus, and Elizabeth
Crownhart Vaughan. The Corporate Governance and Nominating
Committee is primarily responsible for recommending
director nominees to the Company's Board of Directors. The
Committee will consider recommendations by Shareholders
for vacancies on the Board. Suggestions may be submitted
to the Company's Secretary.
8
<PAGE> 11
COMPENSATION OF
EXECUTIVE OFFICERS IN
THE YEAR ENDED
JANUARY 31, 1999
SUMMARY COMPENSATION TABLE
The following table summarizes compensation paid or
accrued by the Company for services rendered by the
Chairman of the Board of Directors, the Co-Presidents,
and two Executive Vice Presidents for the periods
indicated:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Annual Compensation Long-Term Compensation
- ---------------------------------------------------------------------------------------------------------------------
Value of
Restricted
Fiscal Other Annual Stock Awards/ Number
Name and Principal Year Compensation Performance of Stock All Other
Position (a) Salary Bonus (b) Shares(c) Options Compensation(d)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
JOHN J. WHITACRE 1998 $490,000 $805,000 $2,230 $562,513 145,776 $14,932
CHAIRMAN OF THE BOARD 1997 $365,000 $245,791 $1,066 8,760 $14,373
OF DIRECTORS 1996 $350,000 $0 $20,769 10,048 $49,972
- ---------------------------------------------------------------------------------------------------------------------
BLAKE W. NORDSTROM 1998 $277,500 $414,000 $769 $337,502 91,466 $13,404
CO-PRESIDENT 1997 $165,000 $138,500 $22,116 4,128 $52,897
1996 $165,000 $0 $1,250 4,736 $11,138
- ---------------------------------------------------------------------------------------------------------------------
ERIK B. NORDSTROM 1998 $277,500 $414,000 $1,367 $337,502 91,466 $13,388
CO-PRESIDENT 1997 $165,000 $138,500 $3,848 4,128 $12,127
1996 $165,000 $0 $23,803 4,736 $11,463
- ---------------------------------------------------------------------------------------------------------------------
J. DANIEL NORDSTROM 1998 $277,500 $414,000 $3,475 $337,502 91,466 $13,368
CO-PRESIDENT 1997 $165,000 $138,500 $1,979 4,128 $8,419
1996 $165,000 $0 $558 4,736 $6,951
- ---------------------------------------------------------------------------------------------------------------------
JAMES A. NORDSTROM 1998 $277,500 $414,000 $1,204 $337,502 91,466 $13,383
CO-PRESIDENT 1997 $165,000 $138,500 $2,158 4,128 $12,153
1996 $165,000 $0 $4,177 4,736 $11,464
- ---------------------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 1998 $277,500 $414,000 $114 $337,502 91,466 $13,389
CO-PRESIDENT 1997 $165,000 $138,500 $248 4,128 $12,159
1996 $165,000 $0 $113 4,736 $11,469
- ---------------------------------------------------------------------------------------------------------------------
WILLIAM E. NORDSTROM 1998 $277,500 $414,000 $570 $337,502 91,466 $13,394
CO-PRESIDENT 1997 $165,000 $138,500 $789 4,128 $12,023
1996 $165,000 $0 $183 4,736 $11,068
- ---------------------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN 1998 $147,399 $465,193 $21,090 $5,100,006 131,171 $48,143
EXECUTIVE VICE (e) (f)
PRESIDENT AND CHIEF
FINANCIAL OFFICER
- ---------------------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM 1998 $253,989 $450,134 $811 $146,247 38,578 $13,575
EXECUTIVE VICE 1997 $249,250 $457,878 $540 6,292 $12,809
PRESIDENT 1996 $230,000 $6,000 $20,991 6,660 $57,293
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) The fiscal year of the Company ends January 31 of the following year.
(b) Other Annual Compensation for the 1998 fiscal year includes tax
reimbursements.
9
<PAGE> 12
(c) Except for Mr. M. A. Stein, these amounts represent performance share units
granted to the named executive officers on February 26, 1998, as valued as of
that date. These units as valued as of January 31, 1999 would be as follows:
<TABLE>
<S> <C>
John J. Whitacre -- $807,400
Blake W. Nordstrom -- $484,432
Erik B. Nordstrom -- $484,432
J. Daniel Nordstrom -- $484,432
James A. Nordstrom -- $484,432
Peter E. Nordstrom -- $484,432
William E. Nordstrom -- $484,432
Martha S. Wikstrom -- $209,915
</TABLE>
(d) All Other Compensation for the 1998 fiscal year includes the following:
Profit Sharing Plan benefit: Mr. J. J. Whitacre: $8,237; Mr. B. W.
Nordstrom: $8,212; Mr. E. B. Nordstrom: $8,196; Mr. J. D. Nordstrom:
$8,176; Mr. J. A. Nordstrom: $8,191; Mr. P. E. Nordstrom: $8,197; Mr. W. E.
Nordstrom: $8,202; Mr. M. A. Stein: $0; Ms. M. S. Wikstrom: $8,212.
401(k) Plan benefit: Mr. J. J. Whitacre: $4,800; Mr. B. W. Nordstrom:
$4,800; Mr. E. B. Nordstrom: $4,800; Mr. J. D. Nordstrom: $4,800; Mr. J. A.
Nordstrom: $4,800; Mr. P. E. Nordstrom: $4,800; Mr. W. E. Nordstrom:
$4,800; Mr. M. A. Stein: $0; Ms. M. S. Wikstrom: $4,800.
Premiums on excess life insurance: Mr. J. J. Whitacre: $1,895; Mr. B. W.
Nordstrom: $392; Mr. E. B. Nordstrom: $392; Mr. J. D. Nordstrom: $392; Mr.
J. A.. Nordstrom: $392; Mr. P. E. Nordstrom: $392; Mr. W. E. Nordstrom:
$392; Mr. M. A. Stein: $0; Ms. M. S. Wikstrom: $563
Automobile Allowance: Mr. M. A. Stein: $38,636
Relocation Expenses: Mr. M. A. Stein: $9,507
(e) Mr. M. A. Stein commenced employment with the Company on October 15, 1998.
(f) This amount includes a grant of 180,000 shares of restricted stock on
October 15, 1998. These shares vest in five equal installments beginning on
October 15, 1999. Vesting is accelerated if Mr. M. A. Stein's employment is
terminated by the Company without cause, or if he resigns following either a
change in control of the Company or a diminution of his duties, title or
authority, or upon termination due to death or disability. Mr. Stein is entitled
to receive dividends on these shares if and as declared by the Company's Board
of Directors. This amount also includes a grant of 3,784 performance share units
on October 15, 1998 that vest on February 26, 2001 if the Company's performance
exceeds that of the S&P Retail Store Composite set forth in the Performance
Graph on page 18 on that date. As of January 31, 1999, Mr. Stein held 183,784
shares of restricted stock and performance share units, (subject to the vesting
schedules set forth above), the value of which on that date was $7,650,009.
10
<PAGE> 13
OPTION GRANTS IN THE 1998 FISCAL YEAR
The following table sets forth information concerning
option grants during the 1998 fiscal year to the named
executive officers:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Potential Realizable
Percent Value at Assumed
of Total Annual Rates of Stock
Options Price Appreciation for
Number Granted to Exercise or Option Terms
of Options Employees in Base Price -----------------------
Name Granted(a) Fiscal Year Per Share Expiration Date 5% 10%
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
JOHN J. WHITACRE 10,000(b) 4.48% $29.00 Feb 26, 2008 $182,379 $462,185
77,586(c) Feb 26, 2008 $1,415,009 $3,585,911
58,190(d) Feb 26, 2008 $1,061,266 $2,689,456
- --------------------------------------------------------------------------------------------------------------
BLAKE W. NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
ERIK B. NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
J. DANIEL NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
JAMES A. NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
WILLIAM E. NORDSTROM 10,000(b) 2.81% $29.00 Feb 26, 2008 $182,379 $462,185
46,552(c) Feb 26, 2008 $849,013 $2,151,565
34,914(d) Feb 26, 2008 $636,760 $1,613,674
- --------------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN 100,000(e) 4.03% $27.75 Oct 15, 2008 $1,745,183 $4,422,635
11,351(f) Oct 15, 2008 $198,096 $502,013
19,820(c) Oct 15, 2008 $345,895 $876,566
- --------------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM 10,000(b) 1.19% $29.00 Feb 26, 2008 $182,379 $462,185
13,448(c) Feb 26, 2008 $245,264 $621,547
15,130(d) Feb 26, 2008 $275,940 $699,286
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a) Options are granted at the fair market value of the Company's Common Stock
on the date of the grant. To the extent not already exercisable, options
generally become exercisable upon a sale of the Company or substantially all of
its assets.
(b) These options vested and became exercisable on January 31, 1999, based on
the achievement of certain performance base goals related to earnings per share.
11
<PAGE> 14
(c) These options vest and become exercisable if, before February 26, 2003, the
Company's stock sustains an average price for at least 20 consecutive days as
follows: 20% at an average of $40.00; an additional 35% at an average of $47.50;
and an additional 45% at an average of $55.00.
(d) These options vest and become exercisable in four equal annual installments
beginning February 26, 1999.
(e) These options vest and become exercisable in five equal annual installments
beginning October 15, 1999. Vesting is accelerated if Mr. Stein's employment is
terminated by the Company without cause or if he resigns following either a
change in control of the Company or a diminution of his duties, title or
authority, or upon his termination due to death or disability.
(f) These options vest and become exercisable in four equal annual installments
beginning October 15, 1999.
OPTION EXERCISES AND YEAR END VALUE TABLE
The following table sets forth information concerning
option exercises and the value of options held at January
31, 1999 by the named executive officers:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Dollar Value of
Number of Unexercised Unexercised, in-the-Money
Number of Options Held at Options held at
Shares Dollar January 31, 1999 January 31, 1999(a)
Acquired on Value -------------------------- --------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
JOHN J. WHITACRE 42,560 $727,797 40,033 150,197 $740,287 $1,970,116
- ----------------------------------------------------------------------------------------------------------
BLAKE W. NORDSTROM 0 $0 46,804 88,234 $985,581 $1,148,493
- ----------------------------------------------------------------------------------------------------------
ERIK B. NORDSTROM 0 $0 26,273 87,995 $481,101 $1,143,205
- ----------------------------------------------------------------------------------------------------------
J. DANIEL NORDSTROM 0 $0 24,114 88,108 $422,981 $1,145,705
- ----------------------------------------------------------------------------------------------------------
JAMES A. NORDSTROM 0 $0 40,904 88,236 $834,860 $1,148,535
- ----------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 0 $0 35,706 88,192 $711,691 $1,147,564
- ----------------------------------------------------------------------------------------------------------
WILLIAM E. NORDSTROM 0 $0 27,168 87,992 $502,000 $1,143,137
- ----------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN 0 $0 0 131,171 $0 $1,819,998
- ----------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM 0 $0 43,018 38,404 $835,100 $533,503
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a) Dollar value is based on the market value of the Company's Common Stock on
the date of exercise or at January 31, 1999, as the case may be, minus the
exercise price.
12
<PAGE> 15
PENSION PLAN TABLE
The following table sets forth information concerning
estimated annual benefits payable to each of the named
executive officers upon their retirement based upon
indicated years of service (without reduction for any
Profit Sharing Retirement Plan benefits):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Years of Service
Average Annual ----------------------------------------------------
Compensation(a) 15 20 25 30 35
- ----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$125,000 $ 45,000 $ 60,000 $ 75,000 $ 75,000 $ 75,000
$150,000 $ 54,000 $ 72,000 $ 90,000 $ 90,000 $ 90,000
$175,000 $ 63,000 $ 84,000 $105,000 $105,000 $105,000
$200,000 $ 72,000 $ 96,000 $120,000 $120,000 $120,000
$225,000 $ 81,000 $108,000 $135,000 $135,000 $135,000
$250,000 $ 90,000 $120,000 $150,000 $150,000 $150,000
$300,000 $108,000 $144,000 $180,000 $180,000 $180,000
$400,000 $144,000 $192,000 $240,000 $240,000 $240,000
$450,000 $162,000 $216,000 $270,000 $270,000 $270,000
$500,000 $180,000 $240,000 $300,000 $300,000 $300,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a) The benefits are payable pursuant to the Nordstrom Supplemental Executive
Retirement Plan, which covers officers of the Company and its subsidiaries,
including the named executive officers. The benefits are unfunded and limited to
a maximum of 60% of the monthly average compensation (based solely on the yearly
amounts set forth in the salary and bonus columns of the Summary Compensation
Table) less any monthly benefits payable under the Nordstrom Profit Sharing
Retirement Plan. The normal annual retirement benefit provided by the Nordstrom
Supplemental Executive Retirement Plan is 2.4% of the monthly average
compensation for the highest thirty-six months measured over the final sixty
months of employment or the entire period of service after age 50, multiplied by
the number of years of service with the Company, up to a maximum of twenty-five
years.
(b) The credited years of service to the Company for the executive officers are
as follows:
<TABLE>
<S> <C>
John J. Whitacre -- 22 years
Blake W. Nordstrom -- 17 years
Erik B. Nordstrom -- 14 years
J. Daniel Nordstrom -- 10 years
James A. Nordstrom -- 13 years
Peter E. Nordstrom -- 14 years
William E. Nordstrom -- 15 years
Michael A. Stein -- 5 years
Martha S. Wikstrom -- 17 years
</TABLE>
13
<PAGE> 16
COMPENSATION AND
STOCK OPTION
COMMITTEE
REPORT ON THE
1998 FISCAL YEAR
EXECUTIVE COMPENSATION The Compensation and Stock Option Committee is comprised
of six directors, and is responsible for setting
compensation levels for the Chairman of the Board of
Directors, the Co-Presidents, and the Executive Vice
Presidents of the Company. The Committee also consults
with the Chairman with respect to the compensation and
benefits for other officers and with respect to the
benefits for certain other employees of the Company.
COMPENSATION PHILOSOPHY
The Company bases different components of its executive
compensation program on differing measures of Company
performance and Shareholder value. The overall goal of
the Committee is to develop compensation programs and
policies that are consistent with and linked to the
Company's strategic business objectives, including
management's value-based approach to managing the
Company. The program is designed to:
- play a critical role in attracting and retaining
those executives deemed most able to further its
goal of aligning the Company's interests with
creating value for Shareholders; and
- reward executives for medium and long-term
Company performance and value created for
Shareholders as measured by a mix of factors,
including increases in Company stock price, sales
increases, earnings per share, economic profit,
and other performance-related value drivers,
which will or should increase Shareholder return.
Internal Revenue Code Section 162(m) disallows a tax
deduction to public corporations for compensation over
$1,000,000 paid to the Company's Chief Executive Officer
and four other most highly paid officers as of the end
of any fiscal year. The statute exempts qualifying
"performance-based compensation" from the deduction
limit if certain requirements are met. The Committee
currently intends to structure performance-based
compensation, including stock option grants and annual
bonuses to executive officers who may be subject to
Section 162(m), in a manner that satisfies those
requirements. The Committee reserves the authority to
award non-deductible compensation in circumstances that
are in the best interests of the Shareholders and the
Company.
In order to reinforce management's long-term program to
assure that the Company increases value for
Shareholders, the Committee restructured portions of its
1998 fiscal year compensation program as more fully
described in connection with the various compensation
components below. Although this restructuring generally
resulted in increases in base salary levels, these
levels remain below the median for the Company's
competitors. Instead of raising base salaries further,
the Company preferred to tie a larger portion of
executives' compensation to components that are
dependent upon the performance of both the executive and
the Company.
COMPENSATION COMPONENTS
The Company's executive compensation program is based on
three components, each of which furthers a differing
objective, but all of which together are intended to
serve the Company's overall compensation philosophy and
further the Company's value-based management approach by
more closely aligning the Company's compensation program
with increasing value for Shareholders.
14
<PAGE> 17
BASE SALARY. Base salary increases or decreases are
established on an annual basis and are based on the
Committee's view of how the management team and the
respective individuals contribute to the overall
performance of the Company. Overall performance of the
Company is measured by a number of factors including the
Company's earnings, its performance versus its retail
competitors, its performance versus budget, its
improvement in gross margins, and the Committee's
assessment of management skills. None of these factors
is given greater weight than any other factor. The
Committee also reviews the median base salaries for
competitors in the specialty retailing field, including
companies listed in Standard & Poor's Retail Store
Composite referenced in the Performance Graph on page
18. For the 1998 fiscal year, this review resulted in
substantial increases in base salary to a number of
Company executives, as the Committee chose to set base
salaries closer to its competitors' median base
salaries. Previously, base salaries were set
substantially below these amounts.
ANNUAL BONUS INCENTIVES. Annual bonus incentives are
intended to reflect the Company's belief that
management's contribution to medium and long-term
Company performance comes, in part, from improvement in
Company earnings per share, division sales, inventory
turn, and gross margins. Annual bonus incentives for the
Chairman, the Co-Presidents, and the Executive Vice
President and Chief Financial Officer have been based
solely on specified earnings per share target amounts.
Annual bonus incentives for the other Executive Vice
Presidents have been based on various combinations of
earnings per share, division sales, inventory turn,
gross margin, and expense control targets. The amount of
the respective bonuses has been based on these targets,
which, in turn, relate to pre-established percentages of
the respective base salaries. Under this plan, executive
officers have not received any bonus incentives until
the applicable minimum specified performance target was
achieved. The performance targets have not been waived
for purposes of these bonus incentives for any year
covered by the Summary Compensation Table. For the 1998
fiscal year, there were increases in annual bonus
incentive amounts because the Committee chose to set the
incentives closer to the Company's competitors'
incentives, and because of the substantial increase in
the performance of the Company.
LONG-TERM INCENTIVES. Stock Options. The 1987 Stock
Option Plan expired in August 1997. The 1987 Plan
authorized granting options to key employees or key
managerial personnel of the Company and its
subsidiaries. A number of options granted under this
Plan remain outstanding. The 1997 Stock Option Plan,
adopted for a term of 10 years beginning May 20, 1997,
authorizes granting options to employees of the Company
and its subsidiaries. Both the 1987 and 1997 Stock
Option Plans are administered by the Committee.
The option incentive component of the total compensation
package is intended to retain and motivate executives to
increase total return to the Shareholders. Stock options
must be granted at the fair market value of the
Company's Common Stock and only have value if the
Company's stock price increases from the time of the
award. Vesting of options occurs only during employment
with the Company (and after retirement for those who do
not thereafter compete with the Company) upon each
anniversary of the award unless vesting of the options
is subject to performance goals established by the
Committee.
15
<PAGE> 18
The number of stock options granted to the executive
officers named in the Summary Compensation Table is
currently determined by the Committee pursuant to a
formula without reference to the number of stock options
granted previously. Pursuant to the formula, the number
of option shares granted has corresponded to the number
of underlying Company shares that would produce a value
ranging from 56% to 113% of the participant's yearly
salary, calculated based on the Black-Scholes formula.
Stock options are currently granted to those executives
in February of each year. Since the formula is keyed to
salary, the performance factors discussed in the Base
Salary paragraph also would apply to this compensation
component. The Committee reserves the right to change or
eliminate the formula at any time.
In the 1998 fiscal year, the Committee granted stock
options at fair market value with vesting over a period
of up to five years, stock options at fair market value
with vesting based on the achievement of pre-established
performance goals related to increases in the Company's
stock price, and stock options to a core group of
executives at fair market value with vesting based on
the achievement of certain earnings per share targets.
PERFORMANCE SHARE UNITS. The 1997 Stock Option Plan also
authorizes granting performance share units to employees
of the Company and its subsidiaries. Performance share
units entitle the grantee to receive shares of the
Company's Common Stock (or cash in lieu thereof or
deferral into the Executive Deferred Compensation Plan
as stock units) upon the achievement of pre-established
performance goals, which may be related to comparative
shareholder return, stock price, results of operations
or other financial results, or market share. For the
1998 fiscal year, the Committee granted performance
share units to a number of executives that will only
have value to the grantee if pre-established performance
goals related to the three-year total Shareholder return
in relation to Standard & Poor's Retail Store Composite
(i.e., the index referenced in the Performance Graph on
page 18) are met.
RESTRICTED STOCK. Finally, the 1997 Stock Option Plan
authorizes granting shares of restricted stock to
employees of the Company and its subsidiaries. In order
to attract a new Chief Financial Officer from a Fortune
500 company, the Committee granted 180,000 shares of
restricted stock to Michael A. Stein on the terms
described in the note to the Summary Compensation Table
on page 9. No other grants were made in the 1998 fiscal
year.
RETIREMENT. The Nordstrom Profit Sharing Retirement Plan
covers all regular employees of the Company and its
subsidiaries, including the executive officers named in
the Summary Compensation Table. The Board of Directors
determines annually an amount to be contributed by the
Company to the Nordstrom Profit Sharing Retirement Plan
and the Nordstrom Employee Deferral Retirement Plan.
Allocation of the Company's contribution to each
participant's account is pro rata, based on one unit of
credit for each year of service and one unit of credit
for each $100 of compensation up to the IRS limitations.
For purposes of this latter calculation, compensation is
limited to $160,000 for the 1998 calendar year.
SAVINGS. Pursuant to the Nordstrom Employee Deferral
Retirement Plan, employees may elect to have the Company
pay from 1% to 10% of the employee's compensation, up to
a maximum of $10,000 for the 1998
16
<PAGE> 19
calendar year, to the Retirement Plan instead of paying
that amount to the employee. The Company matches 50% of
the employee's contribution up to 6% of the employee's
compensation. Monies in the account are invested at the
direction of the employee among one or more of six
funds, one of which consists of Common Stock of the
Company. Distributions are made for both plans, in
accordance with each plan's provisions, at normal
retirement upon reaching the age of 60 or earlier
termination of employment, and for terminal illness,
disability or hardship.
The Nordstrom Supplemental Executive Retirement Plan
provides retirement benefits to certain executives of
the Company. This Plan is described in the note to the
Pension Plan Table on page 13.
COMPENSATION OF THE
CHAIRMAN AND
CHIEF EXECUTIVE OFFICER The base salary for the Chairman and Chief Executive
Officer is determined by the Committee and is based on
overall Company performance. That performance is
measured by a number of factors including the Company's
earnings, real or perceived retail environment and
competitive conditions, performance versus budget,
growth in sales, improvement in gross margins and the
Committee's assessment of management skills. None of
these factors is given greater weight than any other
factor. The base salary of the Chairman was increased
from $365,000 in 1997 to $500,000 in 1998, reflecting
the Committee's review of median base salaries for
competitors as previously described, and a marked
improvement in a number of important areas of the
Company's financial performance over the previous year.
The annual bonus incentive for the Chairman was based
solely on earnings per share targets as previously
described. Those earnings per share targets were met and
the Chairman received a bonus of $805,000 for the 1998
fiscal year. The Chairman received stock options during
the 1998 fiscal year pursuant to the formula used for
all other executive officers named in the Summary
Compensation Table as previously described.
February 15, 1999
COMPENSATION AND STOCK OPTION COMMITTEE
William D. Ruckelshaus, Chair
D. Wayne Gittinger
Ann D. McLaughlin
John A. McMillan
Alfred E. Osborne, Jr.
Elizabeth Crownhart Vaughan
17
<PAGE> 20
STOCK PRICE PERFORMANCE PERFORMANCE GRAPH
The following graph compares for each of the last five
fiscal years, ending January 31, 1999, the cumulative
total return of Company Common Stock, Standard & Poor's
500 Index, and Standard & Poor's Retail Store Composite.
The cumulative total return of Company Common Stock
assumes $100 invested on January 31, 1994 in Nordstrom,
Inc. Common Stock and assumes reinvestment of dividends.
<TABLE>
<CAPTION>
S&P RETAIL COMPOSITE S&P 500 COMPOSITE
NORDSTROM, INC. INDEX INDEX
--------------- -------------------- -----------------
<S> <C> <C> <C>
1994 100.00 100.00 100.00
1995 117.00 94.00 101.00
1996 115.00 101.00 139.00
1997 110.00 126.00 176.00
1998 152.00 188.00 223.00
1999 251.00 318.00 292.00
</TABLE>
COMPENSATION OF
DIRECTORS Employee directors of the Company are not paid any fees
for serving as members of the Board or any Board
committee. Non-employee directors are paid a yearly
retainer of $15,000, a fee of $1,000 for each Board
meeting attended, a fee of $1,000 for each committee
meeting attended, and reasonable traveling expenses.
Pursuant to the 1993 Non-Employee Director Stock
Incentive Plan, immediately following each Annual
Meeting of Shareholders, non-employee directors also
receive that number of shares of Company Common Stock
having a fair market value of $10,000, plus a $4,000
cash award to offset tax obligations attributable to the
stock award.
COMPENSATION
COMMITTEE INTERLOCKS
AND INSIDER
PARTICIPATION None of the members of the Compensation and Stock Option
Committee are or have been an officer or employee of the
Company or any of its subsidiaries except John A.
McMillan, who was a Co-Chairman of the Board of
Directors of the Company before his retirement in
January 1996. D. Wayne Gittinger, a director of the
Company and a member of the Compensation and Stock
Option Committee, is a partner in the law firm of Lane
Powell Spears Lubersky LLP, which rendered legal
services to the Company during the 1998 fiscal year.
CERTAIN RELATIONSHIPS
AND RELATED
TRANSACTIONS During the 1998 fiscal year, the Company leased an
airplane from JBW Aircraft Leasing Company, Inc.
("JBW"), of which John N. Nordstrom, Bruce A. Nordstrom,
and D. Wayne Gittinger are the sole shareholders. During
the 1998 fiscal year, the Company made lease payments to
JBW of $28,160. Also during the 1998 fiscal year, JBW
made payments to the
18
<PAGE> 21
Company of $41,800 for services rendered. In addition,
the Company chartered an airplane from JFN, Inc., the
shareholders of which are Sally A. Nordstrom and the
Estate of James F. Nordstrom (Sally A. Nordstrom,
personal representative). During the 1998 fiscal year,
the net amount of payments made by the Company to JFN,
Inc. was $95,200. The Company believes the lease and
charter rates and the terms of these arrangements are
more favorable than those generally available to the
Company from other commercial charters. Finally, JW,
Inc., of which John N. Nordstrom and D. Wayne Gittinger
are the sole shareholders, made payments to the Company
of $18,500 for services rendered.
On November 1, 1998, Darren R. Jackson, currently Vice
President and Treasurer of the Company, executed a
promissory note in favor of the Company evidencing a
loan in the original amount of $150,000 (with interest
at the rate of 5.12%) to facilitate his purchase of a
home. The maximum amount of indebtedness, including
accrued interest outstanding under the loan during the
1998 fiscal year, was $151,920.
Michael A. Stein was hired as Executive Vice President
and Chief Financial Officer of the Company on October
15, 1998. In connection with his hiring, the Company
agreed to make him a housing cost differential loan,
bearing interest at the prime rate with interest and
principal forgivable in five equal annual installments
beginning on October 15, 1999, to facilitate his
purchase of a family home in the Seattle area. As Mr.
Stein has yet to acquire a home, no amount has been
loaned. This loan will be immediately forgiven if Mr.
Stein's employment is terminated by the Company without
cause, or if he resigns following either a change in
control of the Company or a diminution of his duties,
title or authority, or upon his termination due to death
or disability.
D. Wayne Gittinger's stepson was employed by the Company
at a salary of $67,292 for the 1998 fiscal year.
J. Daniel Nordstrom's and William E. Nordstrom's brother
was employed by the Company during the 1998 fiscal year
at a total compensation of $92,298.
PROPOSAL 2: RATIFICATION
OF APPOINTMENT OF
AUDITORS The Board of Directors, acting upon the recommendation
of the Audit Committee, has appointed the independent
public accounting firm of Deloitte & Touche LLP to be
the Company's auditors for the 1999 fiscal year. As in
the past, the Board has determined that it would be
desirable to request ratification of its appointment by
the Shareholders of the Company. If the Shareholders do
not ratify the appointment of Deloitte & Touche LLP, the
appointment of independent public accountants will be
reconsidered by the Board. A representative of Deloitte
& Touche LLP will be present at the Annual Meeting, will
have the opportunity to make a statement if he or she so
desires, and will be available to respond to appropriate
questions.
The Board of Directors recommends ratification of
Deloitte & Touche LLP as auditors for the Company.
SOLICITATION OF PROXIES Solicitation of proxies will be made primarily by mail,
and proxies may also be solicited personally, by
telephone, by facsimile, and by regular officers and
employees of the Company who will receive no additional
compensation for their services. Brokers or other
persons holding shares in their names or in the names of
nominees will be reimbursed their reasonable expenses
for sending proxy material to principals and obtaining
their proxies. All expenses of proxy solicitation will
be paid by the Company.
19
<PAGE> 22
COMPLIANCE WITH
SECTION 16 OF THE
EXCHANGE ACT OF 1934 Based solely on its review of copies of reports made
pursuant to Section 16(a) of the Securities Exchange Act
of 1934 and the related regulations, the Company
believes that during the 1998 fiscal year all filing
requirements applicable to its directors, executive
officers, and 10 percent shareholders were satisfied.
OTHER MATTERS The Board of Directors of the Company knows of no other
matters that may come before the meeting. However, if
any other matters should properly come before the
meeting or any adjournment thereof, it is the intention
of the persons named in the Proxy to vote the Proxy in
accordance with their best judgment.
SHAREHOLDER
PROPOSALS FOR 2000
ANNUAL MEETING Proposals for Shareholder action that eligible
Shareholders wish to have included in the Company's
Proxy Statement mailed to Shareholders in connection
with the Company's 2000 Annual Meeting must be received
by the Company at its principal executive offices at
1617 Sixth Avenue, Seattle, Washington, 98101-1742, on
or before December 1, 1999.
By Order of the Board of Directors,
/s/ N. CLAIRE STACK
N. Claire Stack
Secretary
Seattle, Washington
March 31, 1999
20
<PAGE> 23
[NORDSTROM LOGO]
[recycle logo]
Printed on Recycled Paper
<PAGE> 24
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
NORDSTROM, INC.
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101-1742
By signing this Proxy, the Shareholder appoints D. Wayne Gittinger and N.
Claire Stack, or either of them, with full power of substitution, proxies to
vote all shares of stock of the undersigned entitled to vote at the Annual
Meeting of Shareholders of Nordstrom, Inc. to be held May 18, 1999 in Seattle,
Washington, at 11:00 a.m., Pacific Daylight Time, and any adjournment thereof,
with all power the Shareholder would possess if personally present.
This Proxy will be voted in accordance with the instructions given. Unless
revoked or otherwise instructed, the shares represented by this Proxy will be
voted for proposals 1 and 2, and will be voted in accordance with the discretion
of the proxies upon all other matters that may come before the meeting or any
adjournment thereof.
- --------------------------------------------------------------------------------
Please mark, date, sign, and return this proxy card promptly using the
enclosed postage-paid envelope.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
DIRECT DEPOSIT OF DIVIDEND
Nordstrom is pleased to offer its Shareholders of record the ability to have
quarterly dividends electronically deposited. This service is provided at no
cost to you and enables you to have your dividends deposited on the payable date
in an account at the financial institution of your choice.
The advantages of having your dividend payment electronically deposited include:
the availability of funds on the payment date, the elimination of a trip to the
bank, and no possibility of a stolen or lost check.
If you wish to take advantage of this service, then please contact ChaseMellon
Shareholder Services at 1-800-318-7045.
NORDSTROM
<PAGE> 25
Please mark [X]
your votes as
indicated in
this example
<TABLE>
<CAPTION>
FOR all nominees Withhold
(except as indicated to AUTHORITY to vote
the contrary below) for all nominees
<S> <C> <C> <C>
PROPOSAL 1 - ELECTION OF DIRECTORS [ ] [ ]
D. W. Gittinger, E. Hernandez, Jr., A. D. McLaughlin,
J. A. McMillan, B. A. Nordstrom, J. N. Nordstrom,
A. E. Osborne, Jr., W. D. Ruckelshaus, E. C. Vaughan,
J. J. Whitacre, B. G. Willison
To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.
FOR AGAINST ABSTAIN
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS [ ] [ ] [ ]
</TABLE>
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS
AS MAY PROPERLY COME BEFORE THE MEETING. The Board of Directors at present knows
of no other matters to be brought before the meeting.
Signature(s)_____________________________________Dated_____________________,1999
PLEASE SIGN AS YOUR NAME APPEARS ON THIS PROXY. Joint signers should each sign.
Trustees, Guardians, Personal and other Representatives, please indicate your
full title.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
EXPERIENCE NORDSTROM ONLINE
At Nordstrom, we want to ensure that customers find shopping with us as
convenient and rewarding as possible. This is the very reason we created
www.nordstrom.com.
Through our official web site, customers are provided with a variety of options.
They can order merchandise, learn about our Company history, and review
important shareholder information such as news releases, daily stock quotes,
even the complete content of our annual report, all from the comfort of their
home or office. The bottom line is, we want to be where our customers want us to
be.
Of course, we value and welcome your feedback. If you have any comments
regarding our web site, we encourage you to contact us by e-mail at
[email protected], or by phone at 206-233-6301.
NORDSTROM
<PAGE> 26
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
NORDSTROM, INC.
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101-1742
By signing this Proxy, the Shareholder appoints D. Wayne Gittinger and N.
Claire Stack, or either of them, with full power of substitution, proxies to
vote all shares of stock of the undersigned entitled to vote at the Annual
Meeting of Shareholders of Nordstrom, Inc. to be held May 18, 1999 in Seattle,
Washington, at 11:00 a.m., Pacific Daylight Time, and any adjournment thereof,
with all power the Shareholder would possess if personally present.
This Proxy will be voted in accordance with the instructions given. Unless
revoked or otherwise instructed, the shares represented by this Proxy will be
voted for proposals 1 and 2, and will be voted in accordance with the discretion
of the proxies upon all other matters that may come before the meeting or any
adjournment thereof.
- --------------------------------------------------------------------------------
Please mark, date, sign, and return this proxy card promptly using the
enclosed postage-paid envelope.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
DEAR PLAN PARTICIPANT:
Since you have a portion of your Nordstrom 401(k) account in the Nordstrom Stock
Fund, you have the right to vote the shares of Nordstrom stock held for your
account. This same proxy and voting information is furnished to all Nordstrom
Shareholders.
The Trustee of the Nordstrom Profit Sharing Retirement Trust (Wells Fargo Bank),
which holds the stock on your behalf, will receive your signed proxy and
instructions, as well as those made by other participants, and cast the
resulting vote on behalf of the Fund. YOUR VOTE WILL BE KEPT IN STRICT
CONFIDENCE BY THE TRUSTEE.
YOUR VOTE IS IMPORTANT. Please return only this proxy card in the enclosed
envelope. Do not combine it with any other proxy cards you may receive as they
may be tabulated by a different system. You must execute and return this proxy
card if you wish to vote these shares.
NORDSTROM
<PAGE> 27
Please mark [X]
your votes as
indicated in
this example
<TABLE>
<CAPTION>
FOR all nominees WITHHOLD
(except as indicated to AUTHORITY to vote
the contrary below) for all nominees
<S> <C> <C> <C>
PROPOSAL 1 - ELECTION OF DIRECTORS [ ] [ ]
D. W. Gittinger, E. Hernandez, Jr., A. D. McLaughlin,
J. A. McMillan, B. A. Nordstrom, J. N. Nordstrom,
A. E. Osborne, Jr., W. D. Ruckelshaus, E. C. Vaughan,
J. J. Whitacre, B. G. Willison
To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.
FOR AGAINST ABSTAIN
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS [ ] [ ] [ ]
IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS
AS MAY PROPERLY COME BEFORE THE MEETING. The Board of Directors at present knows
of no other matters to be brought before the meeting.
</TABLE>
Signature(s)_____________________________________Dated_____________________,1999
PLEASE SIGN AS YOUR NAME APPEARS ON THIS PROXY. Joint signers should each sign.
Trustees, Guardians, Personal and other Representatives, please indicate your
full title.
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
EXPERIENCE NORDSTROM ONLINE
At Nordstrom, we want to ensure that customers find shopping with us as
convenient and rewarding as possible. This is the very reason we created
www.nordstrom.com.
Through our official web site, customers are provided with a variety of options.
They can order merchandise, learn about our Company history, and review
important shareholder information such as news releases, daily stock quotes,
even the complete content of our annual report, all from the comfort of their
home or office. The bottom line is, we want to be where our customers want us to
be.
Of course, we value and welcome your feedback. If you have any comments
regarding our web site, we encourage you to contact us by e-mail at
[email protected], or by phone at 206-233-6301.
NORDSTROM
