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Chairman of the Board |
Erik B. Nordstrom | Peter E. Nordstrom | |||||||
Chief Executive Officer | President |
2024 Proxy Statement | 2 |
3 |
WHEN | WHERE | RECORD DATE | ||||||
Wednesday, May 22, 2024 | virtualshareholdermeeting.com/JWN2024 | March 13, 2024 | ||||||
9:00 a.m. Pacific Daylight Time | ||||||||
Items of Business | |||||
To vote on the following proposals: | |||||
1 | To elect twelve directors to serve until the 2025 Annual Meeting of Shareholders | ||||
2 | To ratify the appointment of Deloitte as our independent registered public accounting firm to serve for the fiscal year ending February 1, 2025 | ||||
3 | To conduct an advisory vote regarding the compensation of our Named Executive Officers | ||||
4 | To transact any other business that may properly come before the Annual Meeting and any adjournment or postponement thereof |
Online At proxyvote.com | Toll-free Phone Call 1-800-690-6903 | Mail Vote Processing c/o Broadridge 51 Mercedes Way Edgewood, NY 11717 | Scanned QR Code Using your mobile device |
2024 Proxy Statement | 4 |
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE | ||
The accompanying Proxy Statement and the |
5 | 2024 Proxy Statement |
Term | Definition | ||||
2023 Annual Report | Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended February 3, 2024 | ||||
AFC | Audit and Finance Committee of the Board | ||||
ASC 718 | Accounting Standards Codification 718, Stock Compensation | ||||
Board | The Board of Directors | ||||
Broadridge | Broadridge Investor Communication Services | ||||
Bylaws | Bylaws of the Company (as amended and restated September 20, 2023) | ||||
CD&A | Compensation Discussion & Analysis | ||||
CEO | Chief Executive Officer | ||||
CFO | Chief Financial Officer | ||||
CGNC | Corporate Governance and Nominating Committee of the Board | ||||
Chairman | Our Board Chairman, a non-Executive position | ||||
Clawback Policy | Executive compensation clawback policy contained in our corporate governance guidelines (as amended August 16, 2023) | ||||
Committee | A committee of the Board of the Company | ||||
Common Stock | Nordstrom common stock | ||||
CPCC | Compensation, People and Culture Committee of the Board | ||||
DDCP | Nordstrom Directors Deferred Compensation Plan | ||||
Deloitte | Deloitte & Touche LLP | ||||
DEIB | Diversity, Equity, Inclusion and Belonging | ||||
DEIB Goals | Our DEIB goals at nordstrom.com/diversity | ||||
EBIT | Earnings (Loss) Before Interest and Income Taxes | ||||
EIP | Equity Incentive Plan | ||||
EMBP | Executive Management Bonus Plan | ||||
ERG | Employee Resource Group | ||||
ESG | Environmental, Social and Governance | ||||
ESPP | Employee Stock Purchase Plan | ||||
Exchange Act | Securities Exchange Act of 1934 | ||||
FASB | Financial Accounting Standards Board | ||||
GAAP | U.S. Generally Accepted Accounting Principles | ||||
Incentive Adjusted EBIT | Incentive Adjusted Earnings (Loss) Before Interest and Income Taxes (a non-GAAP financial measure) | ||||
Incentive Adjusted ROIC | Incentive Adjusted Return on Invested Capital (a non-GAAP financial measure) | ||||
Investor Relations Website | Our investor relations website at investor.nordstrom.com | ||||
IRC | Internal Revenue Code | ||||
LTI | Long-Term Incentives | ||||
NDCP | Nordstrom Deferred Compensation Plan | ||||
NEO | Named Executive Officer | ||||
Notice | Notice of Annual Meeting of Shareholders | ||||
NYSE | New York Stock Exchange | ||||
PEO | Principal Executive Officer | ||||
Plan Trustee | Bank of New York Mellon, as trustee of the Nordstrom 401(k) Plan | ||||
PSU | Performance Share Unit | ||||
Record Date | March 13, 2024 | ||||
RSU | Restricted Stock Unit | ||||
SEC | Securities and Exchange Commission | ||||
Semler Brossy | Semler Brossy Consulting Group, LLC | ||||
SERP | Supplemental Executive Retirement Plan | ||||
TC | Technology Committee of the Board | ||||
TSR | Total Shareholder Return |
2024 Proxy Statement | 6 |
The Board recommends a vote “FOR” each of the Board’s twelve nominees. |
Committee Memberships | ||||||||||||||||||||||||||
Name | Age | Independent | Director Since | Professional Highlights | AFC | CGNC | CPCC | TC | ||||||||||||||||||
Stacy Brown-Philpot | 48 | ü | 2017 | Founder & Managing Partner, Cherryrock Capital | M, F | C | ||||||||||||||||||||
James L. Donald | 70 | ü | 2020 | Co-Chairman, Albertsons Companies | M, F | C | ||||||||||||||||||||
Kirsten A. Green | 52 | ü | 2019 | Founder & Managing Partner, Forerunner Ventures | M, F | M | ||||||||||||||||||||
Glenda G. McNeal | 63 | ü | 2019 | Chief Partner Officer, American Express | C | M | ||||||||||||||||||||
Erik B. Nordstrom | 60 | 2006 | Chief Executive Officer, Nordstrom | |||||||||||||||||||||||
Peter E. Nordstrom | 62 | 2006 | President & Chief Brand Officer, Nordstrom | |||||||||||||||||||||||
Amie Thuener O’Toole | 49 | ü | 2022 | Vice President and Chief Accounting Officer, Alphabet | C, F | M | ||||||||||||||||||||
Guy B. Persaud | 53 | ü | 2023 | President, New Business Unit, Procter & Gamble | ||||||||||||||||||||||
Eric D. Sprunk | 60 | ü | 2023 | Former COO, Nike | M | M | ||||||||||||||||||||
Bradley D. Tilden Chairman of the Board | 63 | ü | 2016 | Chairman of the Board, Nordstrom, Former Chairman and CEO, Alaska Air Group | M | |||||||||||||||||||||
Mark J. Tritton | 60 | ü | 2020 | Former President and CEO, Bed Bath & Beyond | M | M | ||||||||||||||||||||
Atticus N. Tysen | 58 | ü | 2023 | SVP, Product Development, Chief Information Security and Fraud Prevention Officer, Intuit | M | M | ||||||||||||||||||||
C | Committee Chair | |||||||||||||||||||||||||
M | Committee Member | |||||||||||||||||||||||||
F | Financial Expert |
7 | 2024 Proxy Statement |
Our Director Nominee Demographics | ||
Board Attendance | Board Committees Chaired by Women | |||||||||||||||||||
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 Industry | Business Transformation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
6 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketing & Customer Experience | CEO Experience | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
8 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Online Scale & Growth | Financial Expertise | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
8 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Risk & Crisis Management | Technology Expertise | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
6 | 4 |
Board Refreshment | Nominee Age | |||||||
Relevant Skills and Experience | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Our Board’s nominees possess a balance of leadership experiences, diverse perspectives, strategic skill sets and professional expertise that is essential in furthering our business strategy and objectives, including: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retail Industry | CEO Experience | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8 | 5 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketing & Customer Experience | Financial Expertise | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10 | 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Online Scale & Growth | Technology Expertise | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
11 | 7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Risk & Crisis Management | Diversity, Equity, Inclusion & Belonging | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
9 | 8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Transformation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
11 |
The Board recommends a vote “FOR” this proposal. |
9 | 2024 Proxy Statement |
The Board recommends a vote “FOR” this proposal. |
CEO and President & Chief Brand Officer | Average of all Other NEOs | ||||
85% | 75% | ||||
Performance Based | Performance Based |
CEO and President & Chief Brand Officer | Average of All Other NEOs | ||||
85% | 75% | ||||
Performance-Based | Performance-Based |
Director Compensation and Stock Ownership Guidelines | |||||
11 | 2024 Proxy Statement |
Corporate Governance | ✓ | 10 of 12 Director Nominees are Independent | ✓ | Independent Chairman | ||||||||||
✓ | Regular Executive Session of Independent Directors | ✓ | Committees Comprised Only of Independent Directors | |||||||||||
✓ | The majority of Audit & Finance Committee Members are SEC “Audit Committee Financial Experts” | ✓ | Annual Evaluations of Board, Committees and Directors | |||||||||||
✓ | Authority to Hire Independent Consultants and Experts | ✓ | Our Only Class of Voting Shares Is Our Common Stock | |||||||||||
Shareholder Rights | ✓ | Annual Election of All Directors | ✓ | Majority Vote Standard for Uncontested Director Elections | ||||||||||
✓ | Each Share of Common Stock Is Entitled to One Vote | ✓ | Shareholders of 10%+ Entitled to Call Special Meetings | |||||||||||
✓ | Annual Say-on-Pay Advisory Vote | ✓ | Open Communications with Directors | |||||||||||
✓ | Regular Outreach to and Engagement of Shareholders | |||||||||||||
Compensation | ✓ | Pay-for-Performance Philosophy Guides Executive Compensation | ✓ | Stock Ownership Policy for Directors and Executive Officers | ||||||||||
✓ | Clawback Policy | ✓ | Hedging and Pledging Policies | |||||||||||
✓ | Independent Compensation Consultant Engaged by the CPCC | |||||||||||||
Strategy and Risk | ✓ | Company Strategy Oversight by Board | ✓ | Risk Oversight by Board and Committees Aligned with Company Strategy | ||||||||||
✓ | Regular Risk Management Reports to Board and Committees | ✓ | Compensation Program Designed to Reduce Undue Risk | |||||||||||
✓ | Annual Strategy Planning Meeting | ✓ | Board Oversight of Chief Executive Officer and Management Succession Planning |
13 | 2024 Proxy Statement |
We are a company built on the trust of our customers, employees, business partners and stakeholders. |
2024 Proxy Statement | 14 |
Our Board views effective oversight and management of ESG issues as vital to the Company’s long-term growth. |
15 | 2024 Proxy Statement |
2024 Proxy Statement | 16 |
Audit and Finance Committee |
The Audit and Finance Committee provides financial oversight of the |
17 |
Compensation, People and Culture Committee |
Our Compensation, People and Culture Committee oversees our strategies and goals relating to the development of our employees throughout the organization. | ||
Corporate Governance and Nominating Committee |
Our Corporate Governance and Nominating Committee regularly reviews best practices to ensure the proper functioning of the Board and its Committees. | ||
Technology Committee |
19 |
Non-Employee Director Annual Compensation Elements for | Amount ($)* | ||||
Director Retainer | 85,000 | ||||
AFC Chair Retainer | 30,000 | ||||
CPCC Chair Retainer | 20,000 | ||||
CGNC Chair Retainer | 15,000 | ||||
TC Chair Retainer | 15,000 | ||||
Grant Date Value of Director Equity Grant of Common Stock | 150,000 | ||||
Grant Date Value of Chairman of the Board Equity Grant of Common Stock | 200,000 |
Our Directors are required to hold stock having a value of at least $450,000 | ||
Changes for |
2024 Proxy Statement | 20 |
Non-Employee Director Summary Compensation Table |
Name | Fees Earned or Paid in Cash ($)(a)(b) | Stock Awards ($)(b)(c) | All Other Compensation ($)(d) | Total ($) | ||||||||||
Shellye L. Archambeau | 100,000 | 149,994 | 2,049 | 252,043 | ||||||||||
Stacy Brown-Philpot | 100,000 | 149,994 | 8,545 | 258,539 | ||||||||||
Tanya L. Domier* | — | — | 18,175 | 18,175 | ||||||||||
James L. Donald | 85,000 | 149,994 | 9,924 | 244,918 | ||||||||||
Kirsten A. Green | 85,000 | 149,994 | 581 | 235,575 | ||||||||||
Glenda G. McNeal | 85,000 | 149,994 | 27,052 | 262,046 | ||||||||||
Brad D. Smith | 85,000 | 349,997 | 6,110 | 441,107 | ||||||||||
Bradley D. Tilden | 115,000 | 149,994 | 4,934 | 269,928 | ||||||||||
Mark J. Tritton | 105,000 | 149,994 | 12,282 | 267,276 |
Name | Retainers Earned or Paid in Cash ($)(a)(b) | Stock Awards ($)(b)(c) | All Other Compensation ($)(d) | Total ($) | ||||||||||
Stacy Brown-Philpot | 100,000 | 149,987 | 4,879 | 254,866 | ||||||||||
James L. Donald | 105,000 | 149,987 | 18,028 | 273,015 | ||||||||||
Kirsten A. Green | 85,000 | 149,987 | 17,654 | 252,641 | ||||||||||
Glenda G. McNeal | 100,000 | 149,987 | 42,447 | 292,434 | ||||||||||
Amie Thuener O’Toole | 115,000 | 149,987 | 10,842 | 275,829 | ||||||||||
Guy B. Persaud | 42,500 | 74,994 | — | 117,494 | ||||||||||
Eric D. Sprunk | 85,000 | 149,987 | 17,168 | 252,155 | ||||||||||
Bradley D. Tilden | 85,000 | 349,987 | 6,367 | 441,354 | ||||||||||
Mark J. Tritton | 85,000 | 149,987 | 4,655 | 239,642 | ||||||||||
Atticus N. Tysen | 106,250 | 187,480 | 3,709 | 297,439 |
21 | 2024 Proxy Statement |
2024 Proxy Statement | 22 |
Driving Equity |
Creating an Inclusive Culture |
We are committed to creating a culture where employees feel they can bring their whole selves to work. |
Strengthening Our Talent Pipeline |
23 | 2024 Proxy Statement |
Our values have long served as a north star for our Company — they are deeply embedded in the way we do business and guide the decisions we make, the partnerships we form and the causes we support. |
Respecting Human Rights |
2024 Proxy Statement | 24 |
Investing in Our Communities |
Awards |
25 | 2024 Proxy Statement |
PROPOSAL 1: | ELECTION OF DIRECTORS |
The Board recommends a vote “FOR” each of the Board’s twelve nominees. |
Director Qualifications, Experience and Nominating Process |
DESIRED SKILL | NORDSTROM BUSINESS CHARACTERISTICS | WHAT THE SKILL REPRESENTS | ||||||||||||
Retail Industry | We are a leading fashion retailer devoted to helping customers feel good and look their best. | Large national-scale retail company experience. | ||||||||||||
Marketing & Customer Experience | As customer expectations change, we must evolve our core value of providing excellent customer service to meet customers on their terms. | Expertise in customer service and background in marketing leadership. | ||||||||||||
Online Scale & Growth | Over the past several years, we have made investments to transform into | Experience leveraging online platforms to grow and scale business. | ||||||||||||
Risk & Crisis Management | With a large workforce and operations across the United States, | Experience helping organizations navigate fast-paced and dynamic situations involving emerging risks and crises. | ||||||||||||
Business Transformation | In our effort to give customers the most relevant products, we are changing the way we’ve historically thought about our business model – developing and entering into novel arrangements with brands around the world to give our customers more choices than ever before. | Expertise in overseeing the transformation of business in a dynamic, ever-changing industry. | ||||||||||||
CEO Experience | With more than 350 retail locations across the United States, | Experience as a Chief Executive Officer. | ||||||||||||
Financial Expertise | We are a large public company requiring complex financial forecasts, reporting and other business considerations. | Ability to understand financial data and use that data to make decisions around business strategy. | ||||||||||||
Technology Expertise | We are continually investing in technology to enhance the customer experience. | Demonstrated leadership and expertise relating to digital platforms, information technology, data security and/or data analytics. | ||||||||||||
Diversity, Equity, Inclusion and Belonging | Our commitment to fostering a diverse, equitable, and inclusive environment is key to our mission of helping our customers feel good and look their best. | Demonstrated leadership and experience relating to DEIB related matters. | ||||||||||||
Nominee Characteristics |
Director Nominees | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stacy Brown-Philpot | James L. Donald | Kirsten A. Green | Glenda G. McNeal | Erik B. Nordstrom | Peter E. Nordstrom | Amie Thuener | Guy B. Persaud | Eric D. Sprunk | Bradley D. Tilden | Mark J. Tritton | Atticus N. Tysen | Totals | ||||||||||||||||||||||||||||||||||||||||||||
Retail Industry | l | l | l | l | l | l | l | l | ||||||||||||||||||||||||||||||||||||||||||||||||
Marketing & Customer Experience | l | l | l | l | l | l | l | l | l | 10/12 | ||||||||||||||||||||||||||||||||||||||||||||||
Online Scale & Growth | l | l | l | l | l | l | l | l | l | l | 11/12 | |||||||||||||||||||||||||||||||||||||||||||||
Risk & Crisis Management | l | l | l | l | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||
Business Transformation | l | l | l | l | l | l | l | l | l | l | 11/12 | |||||||||||||||||||||||||||||||||||||||||||||
CEO Experience | l | l | l | l | l | 5/ | ||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Expertise | l | l | l | l | l | l | l | l | l | 10/12 | ||||||||||||||||||||||||||||||||||||||||||||||
Technology Expertise | l | l | l | l | l | l | l | |||||||||||||||||||||||||||||||||||||||||||||||||
l | l | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gender | Woman | Man | Woman | Woman | Man | Man | Woman | Man | Man | Man | Man | Man | 4/12 Women | |||||||||||||||||||||||||||||||||||||||||||
Racially/Ethnically Diverse | Black | White | White | Black | White | White | White | White | White | White | White | 3/12 Diverse |
27 | 2024 Proxy Statement |
Stacy Brown-Philpot Skills and Qualifications 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, 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. | |||||||||||
Independent Director Joined the Board: 2017 | |||||||||||
Age | Career Highlights •2023 to present: Founder and Managing Partner of Cherryrock Capital, a venture capital firm •2016 to 2020: Chief Executive Officer of TaskRabbit, Inc., a digital home services labor platform company •2013 to 2016: Chief Operating Officer of TaskRabbit, Inc. •2012: Entrepreneur-in-Residence at Google Ventures, the venture capital investment arm of Alphabet, Inc. •Prior to 2012: | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
AFC | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
HP, Inc. (since 2015) | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
A wrap dress or a sweater and jeans that fit well! |
James L. Donald Skills and Qualifications Mr. Donald brings to the | |||||||||||
Independent Director Joined the Board: 2020 | |||||||||||
Age | 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 Albertsons •2018: President and Chief Operating Officer of Albertsons •2013 to 2015: Chief Executive Officer of Extended Stay America, Inc., one of the largest integrated hotel owner/operators in the United •Prior to 2013: Chief Executive | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
AFC | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
Albertsons Companies, Inc. (since 2019) | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
A classic blazer. |
Kirsten A. Green Skills and Qualifications Ms. Green brings to the Board extensive experience in consumer and | |||||||||||
Independent Director Joined the Board: 2019 | |||||||||||
Age | Career Highlights •2010 to present: Founder and Managing Partner of Forerunner Ventures, •Prior to 2010: Equity Research Analyst at Banc of America Securities; Senior Associate at Deloitte & Touche LLP | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | Northern Star Investment Corp. II (2021 to 2023) Northern Star Investment Corp. IV (2021 to 2023) Hims and Hers Health, Inc. | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Versatile pieces I can wear in meetings during the day, as well as out to events and dinners in the evenings. |
Glenda G. McNeal Skills and Qualifications 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. | |||||||||||
Independent Director Joined the Board: 2019 | |||||||||||
Age | Career Highlights • •2017 to 2024: President of Enterprise Strategic Partnerships of American Express, a globally integrated payments company •2011 to 2017: Executive Vice President and General Manager of the Global Client Group of American Express •1989 to 2011: •Prior to 1989: Arthur Andersen, LLP; the investment banking firm of Salomon Brothers, Inc. | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | RLJ Lodging Trust (2011 to 2022) | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Elevated, high-quality pieces with a bit of edge and personality. |
29 | 2024 Proxy Statement |
Erik B. Nordstrom Skills and Qualifications Mr. | ||||||||||||||
Director Joined the Board: 2006 | ||||||||||||||
Age | Career Highlights •2020 to present: Chief Executive Officer of Nordstrom, Inc. •2015 to 2020: Co-President of Nordstrom, Inc. •2014 to 2015: Executive Vice President and President, Nordstrom.com of Nordstrom, Inc. •2006 to 2014: Executive Vice President and President, Stores of Nordstrom, Inc. •2000 to 2006: Executive Vice President, Full-Line Stores of Nordstrom, Inc. •2000: Executive Vice President and Northwest General Manager of Nordstrom, Inc. •1995 to 2000: Co-President of Nordstrom, Inc. •1979 to 1995: Nordstrom Canada Retail, Inc., Nordstrom Canada Holdings, LLC and Nordstrom Canada Holdings II, LLC, which are indirect subsidiaries of the Company, have commenced a wind-down of their business operations, obtaining an Initial Order from the Ontario Superior Court of Justice under the Companies’ Creditor Arrangement Act on March 2, 2023 to facilitate the wind-down in an orderly fashion. Erik Nordstrom served as a director and/or officer of such entities. | |||||||||||||
Nordstrom Board Committee Memberships | ||||||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | |||||||||||||
None | None | |||||||||||||
What Nordstrom products help you feel good and look your best? | ||||||||||||||
Outside of the office - high quality athletic wear and a comfortable pair of running shoes. | ||||||||||||||
Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James Nordstrom, Jr., Chief |
Peter E. Nordstrom Skills and Qualifications Mr. | |||||||||||
Director Joined the Board: 2006 | |||||||||||
Age | Career Highlights •2020 to present: President •2015 to 2020: Co-President of Nordstrom, Inc. •2006 to 2015: Executive Vice President and President, Merchandising of Nordstrom, Inc. •2000 to 2006: Executive Vice President, Full-Line Stores of Nordstrom, Inc. •2000: Executive Vice President and Director of Full-Line Store Merchandise Strategy of Nordstrom, Inc. •1995 to 2000: Co-President of Nordstrom, Inc. •1978 to 1995: | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Too many to count and list! | |||||||||||
Erik Nordstrom and Peter Nordstrom are brothers, great-grandsons of the Company’s founder and the second cousins of James Nordstrom, Jr., Chief |
Amie Thuener O’Toole Skills and Qualifications Ms. Thuener O’Toole brings to the Board more than 25 years of finance and accounting experience. Her experience in a variety of senior leadership roles at some of the world’s most innovative companies brings valuable perspectives in finance and accounting matters, including financial planning and reporting, risk assessment, incentive compensation plans and finance advice and support for all mergers and acquisitions activities. She brings to the Board a wealth of knowledge and expertise regarding strategic finance in the context of a rapidly growing and quickly-changing business. | |||||||||||
Independent Director Joined the Board: 2022 | |||||||||||
Age | Career Highlights •2018 to present: Vice President and Chief Accounting Officer of Alphabet Inc., one of the world’s leading technology conglomerate holding companies •2013 to 2018: Vice President and Chief Accountant of Alphabet Inc. •1996 to 2012: Managing Director, Transaction Services of PricewaterhouseCoopers | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Shoes! |
Guy B. Persaud Skills and Qualifications Mr. Persaud brings to the Board more than 15 years of leadership experience in the consumer retail industry and a track record of identifying and operating high-growth and value-creation business opportunities outside of Procter & Gamble’s traditional business units. He has a unique track record of delivering outstanding shareholder return and driving large-scale transformations in a wide range of business and cultural contexts, successfully leading businesses in key global markets such as the U.S., China, Europe, and Latin America. He has significant experience in marketing and brand management, as well as operational expertise in key functions that include research and development, sales, supply chain, manufacturing, acquisitions, product innovation and e-commerce. | |||||||||||
Independent Director Joined the Board: 2023 | |||||||||||
Age 53 | Career Highlights •2021 to present: President of New Business Unit of Procter & Gamble, a global consumer goods company •2015 to 2021: Senior Vice President and General Manager of Procter & Gamble Latin America •1995 to 2015: Various roles of increasing responsibility at Procter & Gamble | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
None | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Brushed cotton blazers with great jeans and boots. |
31 | 2024 Proxy Statement |
Eric D. Sprunk Skills and Qualifications Mr. Sprunk brings to the Board more than 25 years of leadership experience in the consumer retail industry and a track record of driving financial performance and large-scale transformations within a complex global business. He has significant experience in marketing, finance and accounting, as well as operational expertise in key functions that include manufacturing, sourcing, sales and procurement, and product development. His service on public company boards provides additional experience with corporate governance matters, assessing risk and overseeing management. | |||||||||||
Independent Director Joined the Board: 2023 | |||||||||||
Age 60 | Career Highlights •2013 to 2020: Chief Operating Officer of Nike Inc., a global apparel company •2008 to 2015: Executive Vice President of Global Product and Merchandising of Nike •2001 to 2008: Executive Vice President of Global Footwear of Nike •1993 to 2001: Various executive roles at Nike, including Vice/General Manager of America’s Region, General Manager of Footwear Europe, Middle East and Africa, and Chief Financial Officer of Europe, Middle East and Africa •1987 to 1993: Certified public accountant at Price Waterhouse | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
CPCC | |||||||||||
CGNC | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
Bombardier Inc. (2021 to present) General Mills, Inc. (2015 to present) | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Sport coats with high-quality dress shirts and denim. |
Bradley D. Tilden Skills and Qualifications 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 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. | |||||||||||
Independent Director Joined the Board: 2016 | |||||||||||
Age | Career Highlights •2021 to •2014 to 2021: Chairman and Chief Executive Officer of Alaska Air Group, Inc. •2012 to 2014: President and Chief Executive Officer of Alaska Air Group, Inc. •2008 to 2012: President of Alaska Air Group, Inc. •2002 to 2008: Executive Vice President of Finance and Planning of Alaska Air Group, Inc. •2000 to 2008: Chief Financial Officer of Alaska Air Group, Inc. •Prior to 2000: Vice President of Finance at Alaska Air Group, Inc.; PricewaterhouseCoopers | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | Alaska Air Group, Inc. (2010 to 2022) | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Well-made jeans with a dress shirt and classic blue blazer. |
Mark J. Tritton Skills and Qualifications Mr. Tritton brings to the Board over 30 years of experience in retail and apparel businesses, providing him deep insights into consumer behavior, brand building and operational matters which are key to the Company’s business. In addition, as | |||||||||||
Independent Director Joined the Board: 2020 | |||||||||||
Age | Career Highlights •2019 to •2016 to 2019: Executive Vice President and Chief Merchandising Officer of Target Corporation, an omnichannel retailer selling everyday essentials and fashionable, differentiated merchandise at discounted prices online and through several brand retail storefronts •2009 to 2016: Executive Vice President and Division President of the Nordstrom Product Group of Nordstrom, Inc. | ||||||||||
On April 23, 2023, Bed Bath & Beyond Inc. filed a voluntary Chapter 11 petition with the United States Bankruptcy Court for the District of New Jersey. | |||||||||||
Nordstrom Board Committee Memberships | |||||||||||
CPCC | |||||||||||
CGNC | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | Bed Bath & Beyond Inc. (2019 to 2022) | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Stylish footwear and quality skin care products. |
Atticus N. Tysen Skills and Qualifications Mr. Tysen brings to the Board more than three decades of engineering and information security experience. Mr. Tysen also has a wealth of knowledge and expertise regarding technology, cybersecurity and fraud prevention in the context of a rapidly growing and quickly-changing business. His background will add to the diversity of experience already represented across our Board and help us hone an increasingly important area of focus for the retail industry. | |||||||||||
Independent Director Joined the Board: 2023 | |||||||||||
Age 58 | Career Highlights •2021 to present: Senior Vice President Product Development, Chief Information Security and Fraud Prevention Officer of Intuit Inc., a global provider of business and financial management solutions •2020 to 2021: Senior Vice President, Chief Information Security Officer, Chief Fraud Prevention Officer and Chief Information Officer of Intuit Inc. •2013 to 2020: Senior Vice President and Chief Information Officer of Intuit Inc. | ||||||||||
Nordstrom Board Committee Memberships | |||||||||||
AFC | |||||||||||
TC | |||||||||||
Other Current Public Boards | Previous Public Boards in Past 5 Years | ||||||||||
None | None | ||||||||||
What Nordstrom products help you feel good and look your best? | |||||||||||
Casual chinos paired with a great shirt. |
33 |
Audit and Finance Committee | ||||||||||||||
Stacy Brown-Philpot | James L. Donald | Kirsten A. Green | Atticus N. Tysen |
PROPOSAL 2: | RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM |
The Board recommends a vote “FOR” this proposal. |
Audit Fees |
Fiscal Year Ended February 3, 2024 | Fiscal Year Ended January 28, 2023 | ||||||||||||||||||||||
Type of Fee | ($) | (%) | ($) | (%) | |||||||||||||||||||
Audit Fees(a) | 4,765,000 | 92 | 3,658,000 | 89 | |||||||||||||||||||
Audit-Related Fees(b) | 431,000 | 8 | 389,000 | 9 | |||||||||||||||||||
Tax Fees(c) | — | — | 67,000 | 2 | |||||||||||||||||||
TOTAL | 5,196,000 | 100 | 4,114,000 | 100 |
Fiscal Year Ended January 29, 2022 | Fiscal Year Ended January 30, 2021 | ||||||||||||||||||||||
Type of Fee | ($) | (%) | ($) | (%) | |||||||||||||||||||
Audit Fees(a) | 3,411,000 | 86 | 3,332,000 | 86 | |||||||||||||||||||
Audit-Related Fees(b) | 465,000 | 12 | 467,000 | 12 | |||||||||||||||||||
Other Fees(c) | 68,000 | 2 | 68,000 | 2 | |||||||||||||||||||
TOTAL | 3,944,000 | 100 | 3,867,000 | 100 |
Pre-Approval Policy |
35 | 2024 Proxy Statement |
Fanya Chandler | |||||
Employee since 1991 | |||||
Age 52 | |||||
Alexis DePree | |||||
Employee since 2020 | |||||
Age | |||||
Chief Supply Chain Officer | |||||
Gemma Lionello | |||||
Employee since 1988 | |||||
Age 58 | |||||
Jason Morris | |||||
Employee since 2023 | |||||
Age 48 | |||||
Chief Technology and Information Officer since May 2023. Prior to Nordstrom, Mr. Morris served as | |||||
James F. Nordstrom, Jr. | |||||
Employee since 1986 | |||||
Age 51 | |||||
37 | 2024 Proxy Statement |
Lisa Price | |||||
Employee since 2023 | |||||
Age 51 | |||||
Chief Human Resources Officer since | |||||
Cathy R. Smith | |||||
Employee since 2023 | |||||
Age 60 | |||||
Chief Financial Officer since May 2023.Ms. Smith has more than 30 years of financial leadership experience across multiple industries and organizations. Most recently, she served as the | |||||
Ann Munson Steines | |||||
Employee since 2019 | |||||
Age | |||||
Chief Legal Officer, General Counsel and Corporate Secretary since April 2022. Ms. Steines joined the Company as General Counsel and Corporate Secretary in July 2019. Previously, she was Senior Vice President, Deputy General Counsel and Assistant Secretary for 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 Macy’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 Cincinnati, Ohio in 1990 and then practiced law with the law firm of Michael Best & Friedrich in Milwaukee, Wisconsin. | |||||
Kenneth J. Worzel | |||||
Employee since 2010 | |||||
Age | |||||
Chief Customer Officer since April 2022. Previously, he served as Chief Operating Officer from August 2019 to April 2022. From 2018 to August 2019, Mr. Worzel served as Chief Digital Officer, from 2016 to 2019 as President of Nordstrom.com, and from 2010 to 2016, |
Compensation, People and Culture Committee Report The CPCC has reviewed and discussed with management the CD&A included in this Proxy Statement. The CPCC believes the CD&A represents the intent and actions of the CPCC 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 | ||||||||||||||||||||||||||
James L. Donald, Chair | Glenda G. McNeal | Eric D. Sprunk | Mark J. Tritton | |||||||||||||||||||||||
Table of Contents |
Erik B. Nordstrom | Chief Executive Officer | |||||||
Chief Financial Officer | ||||||||
Jason Morris | Chief Technology and Information Officer | |||||||
Peter E. Nordstrom | President & Chief Brand Officer | |||||||
Kenneth J. Worzel | Chief Customer Officer | |||||||
Michael W. Maher | Former Interim Chief Financial Officer and Chief | |||||||
Executive Summary |
39 | 2024 Proxy Statement |
CEO and President & Chief Brand Officer | CEO and President & Chief Brand Officer | Average of All Other NEOs | CEO and President & Chief Brand Officer | Average of All Other NEOs | ||||||
85% | 85% | 75% | 85% | 75% | Performance Based | |||||
Performance-Based | Performance-Based |
2024 Proxy Statement | 40 |
Performance-Based Annual Cash Bonus | 2019 | 2020 | 2021 | 2022 | 2023 | ||||||||||||
CEO and President & Chief Brand Officer actual bonus payouts as a % of target | 47% | 0 | % | 128% | 0 | % | 70% | ||||||||||
Incentive Adjusted EBIT weighting as a % of target | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | |||||||
Average of all other NEOs actual bonus payouts as a % of target | 56 | % | 0 | % | 128 | % | 0 | % | 65 | % | |||||||
Incentive Adjusted EBIT weighting as a % of target | 67 | % | 67 | % | 100 | % | 100 | % | 75 | % |
Grant Realizable % | 2019 | 2020 | 2021 | 2022 | 2023 | ||||||||||||
CEO and President & Chief Brand Officer (realizable value as a % of grant value) | 0 | % | 58 | % | 0 | % | 36 | % | 50 | % | |||||||
Average of all other active NEOs (realizable value as a % of grant value) | 12 | % | 88 | % | 43 | % | 36 | % | 107 | % |
2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||
FINANCIAL RESULTS | ||||||||||||||||||||||||||||||||
Net Earnings (Loss) | $437 | M | $564 | M | $496 | M | ($690 | M) | $178 | M | ||||||||||||||||||||||
EBIT | $926 | M | $837 | M | $784 | M | ($1,047 | M) | $492 | M | ||||||||||||||||||||||
Return on Assets | 5.4 | % | 6.8 | % | 5.1 | % | (7.1 | %) | 1.9 | % | ||||||||||||||||||||||
INCENTIVE COMPENSATION PAYOUTS | ||||||||||||||||||||||||||||||||
Incentive Adjusted EBIT(a) | $952 | M | $909 | M | $808 | M | ($1,047 | M) | $666 | M | ||||||||||||||||||||||
Incentive Adjusted ROIC | 10.0 | % | 12.8 | % | 11.2 | % | (8.5 | %) | 7.0 | % | ||||||||||||||||||||||
Annual bonus payout as a % of Target on Incentive Adjusted EBIT measure(b) | 96 | % | 89 | % | 44 | % | 0 | % | 128 | % | ||||||||||||||||||||||
3-year TSR percentile ranking within the S&P 500(c) | 10%ile | 24%ile | 20%ile | N/A | N/A | |||||||||||||||||||||||||||
PSU vesting (payout as a % of Target) | 0 | % | 0 | % | 0 | % | N/A (d) | 0 | % |
GRANT REALIZABLE VALUES | 2017 | 2018 | 2019 | 2020 | 2021 | |||||||||||||||||||||||||||
PSUs (realizable value as a % of grant value) | 0 | % | N/A | 0 | % | N/A | N/A | |||||||||||||||||||||||||
RSUs (realizable value as a % of grant value) | 93 | % | 64 | % | 71 | % | 112 | % | 66 | % | ||||||||||||||||||||||
Stock options (realizable value as a % of grant value) | 5 | % | N/A | 0 | % | 95 | % | 0 | % |
41 | 2024 Proxy Statement |
WHAT WE DO | WHAT WE DON’T DO | |||||||||||||
ü | Provide employment agreements. | |||||||||||||
Offer separation benefits to our NEOs who are Nordstrom family members. | ||||||||||||||
Offer special perquisites to our NEOs. | ||||||||||||||
Maintain separate change in control agreements. | ||||||||||||||
ü | Retain meaningful stock ownership guidelines: Our expectations for ownership align executives’ interests with those of our shareholders, and | |||||||||||||
Issue grants below 100% fair market value. | ||||||||||||||
ü | Mitigate undue risk: We have caps on potential performance-based bonus payments, a | |||||||||||||
ü | Engage an independent compensation consulting firm: The CPCC’s consultant does not provide any other services to the Company. | |||||||||||||
ü | Apply conservative post-employment and change in control provisions. | |||||||||||||
ü | ||||||||||||||
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 without cause or resigns for good reason, a provision referred to as a “double trigger.” | ||||||||||||||
ü | ||||||||||||||
Restrict pledging activity: All Executive Officers are subject to pre-clearance requirements and restrictions. | ||||||||||||||
ü | ||||||||||||||
Receive strong shareholder support: Each year since 2011, more than 90% of the votes cast have been supportive of our compensation programs. |
Framework for Executive Compensation |
2024 Proxy Statement | 42 |
Compensation Element | Purpose | |||||||||||||||||
Base Salary ($) | Performance-Based Annual Cash Bonus (Target Opportunity as a % of Base Salary) | LTI Annual Grant (Target Grant Value as a % of Base Salary) | ||||||||||||||||||||||||||||||||||||
Name | FYE 2020 | FYE 2021 | FYE 2020 | FYE 2021 | FYE 2020 | FYE 2021 | ||||||||||||||||||||||||||||||||
Erik B. Nordstrom | 758,500 | 758,500 | 200 | 200 | 350 | 350 | ||||||||||||||||||||||||||||||||
Anne L. Bramman | 800,000 | 815,000 | 100 | 100 | 200 | 200 | ||||||||||||||||||||||||||||||||
Peter E. Nordstrom | 758,500 | 758,500 | 200 | 200 | 350 | 350 | ||||||||||||||||||||||||||||||||
Kenneth J. Worzel | 875,000 | 895,000 | 125 | 125 | 250 | 250 | ||||||||||||||||||||||||||||||||
Edmond Mesrobian | 775,000 | 800,000 | 80 | 80 | 150 | 150 |
Milestones | |||||||||||||||||
Name | Bonus Measures | Threshold | Target | Superior | Actual | ||||||||||||
All NEOs | Incentive Adjusted EBIT | $375 | M | $612 | M | $900 | M | $666M | |||||||||
% of Payout | 25 | % | 100 | % | 250 | % | 128 | % | |||||||||
Subject to Incentive Adjusted ROIC threshold | 5.5% | 7.0 | % | ||||||||||||||
Performance Measures for Performance Period: February 3, 2019 – January 29, 2022 | ||||||||
Free Cash Flow Growth | EBIT Margin % | Percentage of Units that will Vest | ||||||
≥31.4% | ≥7.1% | 200% | ||||||
28.9% | 6.8% | 100% | ||||||
26.3% | 6.5% | 50% | ||||||
<26.3% | <6.5% | 0% |
Base Salary ($) | Performance-Based Annual Cash Bonus (Target Opportunity as a % of Base Salary) | LTI Annual Grant (Target Grant Value as a % of Base Salary) | ||||||||||||||||||||||||||||||||||||
Name | FYE 2022 | FYE 2023 | FYE 2022 | FYE 2023 | FYE 2022 | FYE 2023 | ||||||||||||||||||||||||||||||||
Erik B. Nordstrom | 758,500 | 758,500 | 200 | 200 | 350 | 350 | ||||||||||||||||||||||||||||||||
Cathy R. Smith | N/A | 875,000 | N/A | 125 | N/A | 250 | ||||||||||||||||||||||||||||||||
Jason Morris | N/A | 830,000 | N/A | 80 | N/A | 175 | ||||||||||||||||||||||||||||||||
Peter E. Nordstrom | 758,500 | 758,500 | 200 | 200 | 350 | 350 | ||||||||||||||||||||||||||||||||
Kenneth J. Worzel | 895,000 | 895,000 | 125 | 125 | 250 | 250 | ||||||||||||||||||||||||||||||||
Michael W. Maher | 525,000 | 525,000 | 50 | 50 | 70 | 70 |
43 | 2024 Proxy Statement |
Measure and | |||||
CEO and President & Chief Brand Officer | 100% Incentive Adjusted EBIT | ||||
Other NEOs | 75% 25% Operational Metric subject to achievement of the |
Milestones | |||||||||||||||||||||||
Name | Bonus Measure (a) (b) | Weight | Threshold 25% | Target 100% | Superior 250% | Actual | Total Bonus Payout as a % of Target (c) | ||||||||||||||||
Erik B. Nordstrom | Incentive Adjusted EBIT | 100 | % | $498M | $858M | $1,258M | $718M | 70 | % | ||||||||||||||
Total Payout | 70 | % | |||||||||||||||||||||
Cathy R. Smith | Incentive Adjusted EBIT | 75 | % | $498M | $858M | $1,258M | $718M | 53 | % | ||||||||||||||
Operational Metric | 25 | % | 19 | % | |||||||||||||||||||
Total Payout | 72 | % | |||||||||||||||||||||
Jason Morris | Incentive Adjusted EBIT | 75 | % | $498M | $858M | $1,258M | $718M | 53 | % | ||||||||||||||
Operational Metric | 25 | % | 19 | % | |||||||||||||||||||
Total Payout | 72 | % | |||||||||||||||||||||
Peter E. Nordstrom | Incentive Adjusted EBIT | 100 | % | $498M | $858M | $1,258M | $718M | 70 | % | ||||||||||||||
Total Payout | 70 | % | |||||||||||||||||||||
Kenneth J. Worzel | Incentive Adjusted EBIT | 75 | % | $498M | $858M | $1,258M | $718M | 53 | % | ||||||||||||||
Operational Metric | 25 | % | — | % | |||||||||||||||||||
Total Payout | 53 | % | |||||||||||||||||||||
Michael W. Maher | Incentive Adjusted EBIT | 75 | % | $498M | $858M | $1,258M | $718M | — | % | ||||||||||||||
Operational Metric | 25 | % | — | % | |||||||||||||||||||
Total Payout | — | % |
2024 Proxy Statement | 44 |
45 | 2024 Proxy Statement |
Position | Multiple of Base Salary Used to | ||||||||||
Chief Executive Officer | 10x | ||||||||||
Chief Financial Officer | 4x | ||||||||||
Chief Technology and | 3x | ||||||||||
President & Chief Brand Officer | 10x | ||||||||||
Chief Customer Officer | 4x | ||||||||||
Former Interim Chief Financial Officer | 1x |
Name and Principal Position | Fiscal Year | Salary ($)(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. Nordstrom | 2021 | 758,700 | — | — | 3,699,999 | 1,941,761 | (692,013) | 44,686 | 5,753,133 | ||||||||||||||||||||
Chief Executive Officer | 2020 | 367,419 | — | 1,592,846 | 2,654,740 | — | 1,010,681 | 21,984 | 5,647,670 | ||||||||||||||||||||
2019 | 756,393 | — | 1,592,836 | 1,061,897 | 708,591 | 2,700,516 | 52,070 | 6,872,303 | |||||||||||||||||||||
Anne L. Bramman | 2021 | 812,892 | — | 1,319,977 | 879,995 | 1,040,246 | — | 24,679 | 4,077,789 | ||||||||||||||||||||
Chief Financial Officer | 2020 | 699,231 | — | 1,999,988 | 1,824,997 | — | — | 14,411 | 4,538,627 | ||||||||||||||||||||
2019 | 793,750 | — | 1,549,974 | 1,859,994 | 564,500 | — | 39,912 | 4,808,130 | |||||||||||||||||||||
Peter E. Nordstrom | 2021 | 758,700 | — | — | 3,699,999 | 1,941,761 | (1,364,580) | 56,475 | 5,092,355 | ||||||||||||||||||||
President and Chief Brand Officer | 2020 | 367,419 | — | 1,592,846 | 2,654,740 | — | 1,055,774 | 24,849 | 5,695,628 | ||||||||||||||||||||
2019 | 756,393 | — | 1,592,836 | 1,061,897 | 708,591 | 2,782,378 | 77,355 | 6,979,450 | |||||||||||||||||||||
Kenneth J. Worzel | 2021 | 892,123 | — | 1,443,737 | 962,494 | 1,427,077 | 1,389,900 | 32,195 | 6,147,526 | ||||||||||||||||||||
Chief Customer Officer | 2020 | 764,597 | — | 2,624,977 | 2,374,996 | — | 864,312 | 18,367 | 6,647,249 | ||||||||||||||||||||
2019 | 826,111 | — | 1,999,970 | 2,400,000 | 645,433 | 1,589,618 | 37,080 | 7,498,212 | |||||||||||||||||||||
Edmond Mesrobian | 2021 | 827,123 | — | 1,394,971 | 929,995 | 815,262 | — | 12,158 | 3,979,509 | ||||||||||||||||||||
Chief Technology Officer | 2020 | 677,214 | — | 1,549,973 | 1,374,995 | — | — | 7,917 | 3,610,099 | ||||||||||||||||||||
2019 | 743,542 | — | 2,087,450 | 1,304,995 | 420,971 | — | 10,225 | 4,567,183 |
Benefit | Where to Learn More | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Broad-Based (including Executives) | •Company contribution to medical, dental and vision coverage
: 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 •Short- and long-term disability •Life insurance •Relocation assistance •Merchandise discount •NDCP including Company •Paid time away •Health savings account and flexible spending accounts •ESPP | •For 401(k) •
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Executive Benefits |
•Executive Severance Plan •SERP: This program closed to | •For Retiree Health and |
2024 Proxy Statement | 46 |
Compensation Governance |
Compensation, People and Culture Committee Our CPCC oversees the development and delivery of our pay and benefits philosophy and compensation plans for the NEOs and other executives as described in the CPCC charter. As part of that oversight, the CPCC ensures the 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 CEO’s total direct compensation (base salary + performance-based bonus + LTIs) and our Company’s financial performance metrics within our peer group. The total direct compensation of our NEOs within our peer group is also considered. CPCC Consultant The CPCC has retained Semler Brossy. A consultant from the firm attends CPCC meetings and, in support of the CPCC’s role, provides independent expertise on market practices, compensation program design and related subjects as described on page 18. Semler Brossy provides such services only as directed by the CPCC. During fiscal year 2023, Semler Brossy’s services included a review of executive and Director pay programs, a review of the compensation peer group and other pay-related matters specific to the CPCC’s charter. With respect to Director pay, Semler Brossy provides its services to the CGNC. Management Our CEO and the President & Chief Brand Officer provide input to the CPCC on the level and design of compensation elements for the NEOs and other Executive Officers, excluding themselves. Our Chief Human Resources Officer attends CPCC meetings to provide perspective and expertise relevant to the agenda. Management supports the CPCC’s activity by providing analyses and recommendations developed internally. NEOs are not present for discussions of their own pay.
Market Data Provides a Reference Point for Compensation The CPCC 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 CPCC uses survey data provided by external consultants, monitors general market movement for executive pay and references proxy statements for specific roles. 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. Target total direct compensation for 2023 for Erik Nordstrom was below our peer group median, as it has been in previous years. Based on the CPCC’s review of relevant market data and internal pay equity, the CPCC believes the target total direct compensationfor the other NEOs was within a competitive range of the peer group median. Actual pay for the NEOs can exceed our established targets or peer group actual pay through the variable compensation elements when pre-determined performance milestones established by the CPCC are achieved. Peer Group Companies Represent Our Business Each year, the CPCC reviews the appropriateness of our peer group for comparison on pay and related practices. Collectively, the peer group companies represent our primary business areas, including our Nordstrom, Nordstrom Rack, in-store and online businesses and private label products. The peer group companies generally meet the following selection criteria: •fall within the Consumer Discretionary sector; •fall within a reasonable range of our size, defined as one-third to three times our revenue and one-fourth to four times our market capitalization; •share similar talent, operational and/or business characteristics, including a retail-focused business model; •have a similar or related product focus and place a high value on customer experience; •are part of our industry group as defined by institutional shareholders and shareholder service organizations; and •are a public company subject to similar market pressures. Our peer group used for evaluating compensation for fiscal year 2023 was comprised of the following retail companies:
During 2023, as part of its annual review of peer companies to be used for compensation comparison purposes, the CPCC made no changes to the peer group. Compensation Risk Assessment Supports Integrity of Our Pay Practices 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 2022, 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 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 are predominantly team-oriented rather than individually focused, and tied to measurable factors that are both transparent to shareholders and drivers of shareholder return. •The compensation program balances the importance of achieving critical short-term objectives with a focus on realizing long-term strategic priorities. Strong stock ownership guidelines are in place for Company leaders, and mechanisms, such as our 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 the Company’s compensation plans do not encourage risk taking that is reasonably likely to have a material adverse effect on the Company. Clawback Policy Applies to Performance-Based Pay In 2023, we revised our Clawback Policy, and in 2024, we publicly filed our new Clawback Policy, each in accordance with the SEC’s adoption of the final rules implementing the incentive-based compensation recovery provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act and NYSE’s adoption of compensation recovery listing standards. Our Clawback Policy provides for the mandatory recovery of erroneously awarded incentive-based compensation from current and former executive officers of the Company in the event that the Company is required to restate its financial results due to the Company’s material noncompliance with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously filed financial statements with the SEC that (i) is material to the previously filed financial statements, or (ii) would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period. Under our Clawback Policy, recovery of any such compensation is required regardless of whether the officer who received erroneously awarded compensation engaged in misconduct or otherwise caused or contributed to the requirement of an accounting restatement. LTI Grants Are Effective On the First Day of the Open Trading Window The CPCC considers annual equity-based awards at its annual February meeting, which is typically held approximately three weeks after fiscal year-end, and approves such awards either at that meeting or in the days shortly following. Annual grants are customarily effective on the first day of the Company’s next open trading window following CPCC approval. The CPCC may approve one-time equity-based grants to executives on other dates for reasons such as newly hired executives or for retention purposes. Such grants are generally effective on the first day of the Company’s next open trading window following approval by the CPCC. 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 eligible for separation benefits under the plan. Separation benefits are described in the Potential Payments Upon Termination or Change in Control section beginning on page 60. 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. Notwithstanding, if the successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the cancellation of the vested portion of any such award in exchange for either an amount of cash (or stock, other securities or other property) and provide for the cancellation of the unvested portion of the award, if any, without payment of consideration. 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 disallows a tax deduction to public companies for annual compensation over $1 million paid to “covered employees,” which generally include NEOs. Certain performance-based compensation under arrangements in place as of November 2, 2017 are not subject to the limitation. Therefore, compensation in excess of $1 million paid to our NEOs is generally expected to be nondeductible 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 2023 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.
Summary Compensation Table The following table summarizes the total compensation paid or accrued by the Company for services provided by the NEOs for fiscal years ended February 3, 2024, January 28, 2023 and January 29, 2022. Neither Cathy Smith nor Jason Morris were NEOs in fiscal years 2022 and 2021, so no amounts are shown in those years. Michael Maher was not a NEO in fiscal year 2021, so no amounts are shown in that year.
(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 generally effective in March. Also, as a result of our 4-5-4 retail reporting calendar, fiscal year 2023 included an extra week (the 53rd week). The 2023 base salaries shown for Cathy Smith, Jason Morris and Michael Maher reflect a partial year of base salary, as Cathy Smith and Jason Morris joined the Company on May 29, 2023 and May 1, 2023, respectively, and Michael Maher left the Company on June 16, 2023.The 2023 base salaries are described on page 43. Kenneth Worzel elected to defer 10% of his base salary earned during calendar year 2023 into the NDCP. Due to the timing of our fiscal year ends, $82,615 was attributed to fiscal year 2023 deferrals for Kenneth Worzel as reported in the Fiscal Year 2023 Nonqualified Deferred Compensation Table on page 59. Each of the NEOs contributed a portion of their base salary earned during fiscal year 2023 to the 401(k) Plan. (b) Bonus This column refers to one-time payments not made under the EMBP. Cathy Smith received a one-time lump sum cash sign-on payment of $550,000 as a consideration for value forfeited by joining the Company.Jason Morris received a cash sign-on payment paid in three installments as a consideration for value forfeited by joining the Company. The first installment of $1,170,000 was paid in fiscal year 2023, with the second and third installments of $415,000 to be paid in fiscal years 2024 and 2025, respectively, contingent upon continued service with the Company. (c) Stock Awards The amounts reported reflect the grant date fair value of PSUs and RSUs granted during the fiscal year under the 2019 EIP. The amounts reported are not the value actually received.
The value the NEOs will ultimately receive from their 2023 and 2022 PSUs will depend on the performance requirements and the market price of Common Stock at the end of the three-year performance cycle. In fiscal years 2023 and 2022, PSUs were granted to Erik Nordstrom, Peter Nordstrom and Kenneth Worzel. The amounts reported were calculated in accordance with ASC 718 and reflect the grant date fair value at target (100%). The minimum number of PSUs that can be earned at the end of each three-year performance cycle is 75% and the maximum is 150%. The grant date fair value for the PSUs awarded in fiscal year 2023 to Erik Nordstrom, Peter Nordstrom and Kenneth Worzel, at the maximum payout of 150%, is $2,389,268, $2,389,268 and $2,013,744, respectively. The grant date fair value for the PSUs awarded in fiscal year 2022 to Erik Nordstrom, Peter Nordstrom and Kenneth Worzel, at the maximum payout of 150%, is $2,389,266, $2,389,266 and $2,013,750, respectively. See column (c) of the Grants of Plan-Based Awards in Fiscal Year 2023 table on page 53 for the target number of PSUs granted in fiscal year 2023. No PSU amounts are reported for fiscal year 2021 as the Company did not award PSUs during the fiscal year. The value the NEOs may receive from their RSUs will depend on whether the time-based vesting requirement is met and the market price of Common Stock on the vesting date. In fiscal year 2023, RSUs were granted to Cathy Smith, Jason Morris and Michael Maher. The amounts reported were calculated in accordance with ASC 718. See column (d) of the Grants of Plan-Based Awards in Fiscal Year 2023 table on page 53 for the number of RSUs granted in fiscal year 2023. (d) Option Awards The amounts reported reflect the grant date fair value of stock options granted during the fiscal year under the 2019 EIP. This is not the value received. The NEOs will only realize value from stock options if the market price of Common Stock is higher than the exercise price of the stock 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 2023 table on page 53 for the number of stock options granted in fiscal year 2023. Assumptions used in the calculation of these amounts are included in the notes to the financial statements contained within the Company’s 2023 Annual Report. (e) Non-Equity Incentive Plan Compensation The amounts reported reflect the annual performance-based cash awards under the EMBP, as described on page 43. Kenneth Worzel deferred $433,649 of his cash award earned in fiscal year 2023 into the NDCP. (f) Change in Pension Value and Nonqualified Deferred Compensation Earnings The amounts reported are the increases in actuarial present value from each fiscal year end for each of the eligible NEO’s benefit under the 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, actuarial assumptions (discount rate and mortality table used to determine the present value of the benefit), and the annual SERP benefit cap of $700,000. The present value of Erik Nordstrom’s and Peter Nordstrom’s benefit decreased from 2022 fiscal year end by $511,700 and $516,320, respectively. The decreases were primarily the result of an increase in the discount rate used to determine the present value of the benefits. The interest rate used is the same as the discount rate used for financial reporting purposes for the SERP, which changed from 4.95% to 5.27%. Negative values are not reported in the table, so no amounts are shown for Erik Nordstrom and Peter Nordstrom. The present value of Kenneth Worzel’s benefit increased by $465,523, primarily due to an increase to service, which more than offset any decrease due to the change in the discount rate. Amounts are not reported for the other NEOs, as they are not eligible for the SERP benefit. The amounts were calculated using the same discount rate 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 2023 Annual Report. Kenneth Worzel and Michael Maher had account balances in the NDCP in fiscal year 2023, as shown on page 59. 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 NEOs is shown in the following table.
The following table shows each component of “All Other Compensation” for fiscal year 2023, reported in column (g) of the Summary Compensation Table on page 50, calculated at the aggregate incremental cost to the Company.
(a) 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 NEOs. The NEOs and all other Company employees may defer up to 50% of their eligible pay (i.e., base salary, performance-based bonus and other taxable wages) into the 401(k) Plan, 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. The total Company matching contribution each of the NEOs received, as shown in the table, reflects this matching formula for fiscal year 2023. Contributions under the 401(k) Plan may be directed to custom target retirement date funds or to any of nine individual investment alternatives, including Common Stock. The Plan also offers a self-directed brokerage option. (b) Premium on Insurance The Company provides life insurance to the NEOs in an amount equal to approximately two times their base salary and additional disability insurance. The amounts reported are the annual Company-paid premiums. (c) Expenses in Connection with Relocation The Company provides relocation assistance to eligible employees who have changed their place of residence to accept a position with Nordstrom. The type and amount of assistance varies by leadership level. Cathy Smith and Jason Morris received relocation benefits under our guidelines for an executive at their level when they relocated to the Company’s headquarters in Seattle. The amount reported is the cost incurred by the Company for relocation expenses. (d) Tax Reimbursement in Connection with Relocation The Company provides reimbursement of all taxes incurred on taxable moving expenses to employees who have changed their place of residence to accept a position with Nordstrom. The amount reported is the grossed-up tax reimbursement received by Cathy Smith and Jason Morris in fiscal year 2023. (e) Other Benefits The amounts reported include the total discount the NEOs received on their Nordstrom purchases during fiscal year 2023. The merchandise discount provided to the NEOs is the same as for all other eligible management and high-performing non-management employees of the Company, and its Board, as described on page 22. Amounts reported for Michael Maher also include lump sum payments of accrued and unused Paid Time Off, which was paid out upon his separation on June 16, 2023. Grants of Plan-Based Awards in Fiscal Year 2023 The following table discloses: •non-equity incentive plan awards granted in fiscal year 2023 and the potential range of payouts. These awards are performance-based cash bonuses granted under the EMBP, as described on page 43; •the number and grant date fair value of PSUs granted under the 2019 EIP in fiscal year 2023 and the potential range of payouts, as described on page 45; •the number, price and grant date fair value of stock options granted under the 2019 EIP in fiscal year 2023, as described on page 45; and •the number and grant date fair value of RSUs granted under the 2019 EIP in fiscal year 2023, as described on page 45.
(a) Grant Date The grant date is the first business day of the open trading window that falls on or after the CPCC approval of the grant. (b) Estimated Future Payouts Under Non-Equity Incentive Plan Awards Although the column heading refers to future payouts, fiscal year 2023 performance-based bonuses resulted in payouts to the eligible NEOs, as reported in the Summary Compensation Table on page 50 in column (e) “Non-Equity Incentive Plan Compensation.” For there to be any payout, minimum performance milestones or achievements must be met and a NEO must be an active employee on the last day of the fiscal year, with the exception of retirement, death and disability, in which case a prorated amount may be earned. The amounts shown in the “Threshold”, “Target” and “Maximum” columns reflect the payout opportunity associated with established levels of performance or achievement, as discussed on page 43, and are based on base salary and bonus targets as of the beginning of the fiscal year for Erik Nordstrom, Peter Nordstrom, Kenneth Worzel and Michael Maher. The payout opportunities for Cathy Smith and Jason Morris, who joined the Company on May 29, 2023 and May 1, 2023, respectively, are based on their base salary for the full year and bonus targets, as a consideration for value forfeited by joining the Company. (c) Estimated Future Payouts Under Equity Incentive Plan Awards The numbers shown report the range of potential payouts at the end of the three-year performance cycle for the PSU grants made in fiscal year 2023 to Erik Nordstrom, Peter Nordstrom and Kenneth Worzel under the 2019 EIP. Payouts are shown in units of 75%, 100% and 150% of the number of PSUs granted.
(d) All Other Stock Awards: Number of Shares of Stock or Units The numbers shown report the number of RSUs granted to Cathy Smith, Jason Morris and Michael Maher in fiscal year 2023 under the 2019 EIP. The 253,024 RSUs granted to Cathy Smith on June 2, 2023 vest 55% on June 10, 2024, 25% on June 10, 2025 and 20% on June 10, 2026. The 169,367 RSUs granted to Cathy Smith on June 2, 2023 vest 50% on June 10, 2025 and 50% on June 10, 2026. The 211,366 RSUs granted to Jason Morris on June 2, 2023 vest 33% on June 10, 2024, 33% on June 10, 2025 and 34% on June 10, 2026. The 55,668 RSUs granted to Jason Morris on June 2, 2023 vest 50% on June 10, 2026 and 50% on June 10, 2027. The RSUs granted on March 6, 2023 to Michael Maher were to vest equally over four years, beginning on March 10, 2024, but were forfeited upon his separation on June 16, 2023. (e) All Other Option Awards: Number of Securities Underlying Options The numbers shown report the number of stock options granted to the Erik Nordstrom, Peter Nordstrom, Kenneth Worzel and Michael Maher in fiscal year 2023 under the 2019 EIP. Stock options were granted on March 6, 2023 and become exercisable on March 10, 2026 and March 10, 2027. The stock option grant to Michael Maher was forfeited upon his separation on June 16, 2023. (f) Exercise or Base Price of Option Awards The exercise price of the stock options granted on March 6, 2023 of $19.63 was the closing price of Common Stock on the grant date. (g) Grant Date Fair Value of Stock and Option Awards The grant date fair value of PSUs, RSUs and stock options was calculated in accordance with ASC 718. The reported value for PSUs granted to Erik Nordstrom, Peter Nordstrom and Kenneth Worzel was calculated by multiplying the number of PSUs granted by the fair value of a PSU on the date of grant, which was $16.42 on March 6, 2023. This is not the value received. The actual value they may receive will depend on performance requirements at the end of the three-year performance cycle and the market price of Common Stock at vest. The reported value for RSUs was calculated by multiplying the number of RSUs awarded by the fair value of a RSU on the date of grant. The fair value of the 253,024 RSUs granted to Cathy Smith on June 2, 2023 was $15.80. The fair value of the 169,367 RSUs granted to Cathy Smith on June 2, 2023 was $14.76. The fair value of the 211,366 RSUs granted to Jason Morris on June 2, 2023 was $15.37. The fair value of the 55,668 RSUs granted to Jason Morris on June 2, 2023 was $13.47. The fair value of the RSU grant on March 6, 2023 to Michael Maher was $17.03. The actual value they 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 RSUs granted to Michael Maher were forfeited upon his separation on June 16, 2023. 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 stock option grants on March 6, 2023 to Erik Nordstrom, Peter Nordstrom, Kenneth Worzel and Michael Maher was $8.15. The actual value the NEOs may receive 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 6, 2023 was $19.63. The stock option grant to Michael Maher was forfeited upon his separation on June 16, 2023.
Outstanding Equity Awards at Fiscal Year End 2023 The following table provides information on the current holdings of stock options and stock awards by NEOs as of the fiscal year ended February 3, 2024. The table includes vested but unexercised stock options, unvested stock options, unvested RSUs and unvested PSUs. The vesting schedules for outstanding stock options and RSUs are provided on page 56. Information about the amount of Common Stock beneficially owned by the NEOs is provided in the Beneficial Ownership Table on page 73. Michael Maher forfeited all of his unvested equity upon his separation on June 16, 2023.
(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 3, 2024. On March 4, 2021, Erik Nordstrom and Peter Nordstrom each received a stock option grant that vests 50% on March 10, 2024 and 50% on March 10, 2025 subject to the condition that the average daily closing price of our Common Stock meets or exceeds $45 per share for any twenty consecutive trading day period prior to March 10, 2025. On March 4, 2021 Kenneth Worzel also received a stock option grant that vests 50% on March 10, 2024 and 50% on March 10, 2025, and is not subject to a price condition for vesting.
(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 RSUs as of the fiscal year ended February 3, 2024. The 253,024 RSUs granted to Cathy Smith on June 2, 2023 vest 55% on June 10, 2024, 25% on June 10, 2025 and 20% on June 10, 2026. The 169,367 RSUs granted to Cathy Smith on June 2, 2023 vest 50% on June 10, 2025 and 50% on June 10, 2026. The 211,366 RSUs granted to Jason Morris on June 2, 2023 vest 33% on June 10, 2024, 33% on June 10, 2025 and 34% on June 10, 2026. The 55,668 RSUs granted to Jason Morris on June 2, 2023 vest 50% on June 10, 2026 and 50% on June 10, 2027.
(c) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested The numbers reported relate to outstanding PSUs granted in fiscal years 2022 and 2023 that have time remaining in their three-year performance cycle, as discussed on page 45. If the performance cycle had ended on the last day of fiscal year 2023, the minimum percentage of 75% of PSUs outstanding would have been earned for PSUs granted in fiscal year 2022 and 2023, which is reflected in the table.
(d) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested The amounts reported relate to outstanding PSUs granted in fiscal year 2022 and 2023 that have time remaining in their three-year performance cycle, as discussed on page 45. If the performance cycle had ended on the last day of fiscal year 2023 and the PSUs vested, the minimum percentage of 75% of PSUs outstanding would have been earned for PSUs granted in fiscal year 2022 and 2023 at $18.12, the closing price of Common Stock on February 2, 2024, the last market trading day of the fiscal year. Option Exercises and Stock Vested in Fiscal Year 2023 The following table provides information for the NEOs on the number of shares of Common Stock acquired and value realized from options exercised and awards that vested with respect to fiscal year 2023.
(a) Number of Shares Acquired on Vesting The numbers reported include RSUs that vested during fiscal year 2023 for Kenneth Worzel and Michael Maher. The amounts also include PSUs that vested for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel of 1,202, 1,202 and 1,013, respectively, which vested on an accelerated basis in fiscal year 2023 solely to satisfy Social Security, Medicare or income tax withholding obligations of retirement-eligible employees with respect to their PSUs. (b) Value Realized on Vesting The amounts reported are the values realized for the RSUs that vested during fiscal year 2023 for Kenneth Worzel and Michael Maher. The amounts also include the number of shares of Common Stock withheld on the vesting of PSUs for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel to satisfy tax withholding obligations as described previously, multiplied by $16.35, the closing price of Common Stock on December 8, 2023, the vesting date. Pension Benefits The Company’s original 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. Beginning in 2012, the SERP was closed to new entrants. The NEOs, except Cathy Smith, Jason Morris and Michael Maher, who joined the Company or moved into an eligible role after the SERP had been closed to new entrants, are eligible for the SERP. The eligible NEOs 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 the 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 CPCC 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 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. 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.
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 CPCC in the exercise of its discretion in accordance with the Plan. The CPCC 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 63 in footnote (b) to the Potential Payments Upon Termination or Change in Control at Fiscal Year End 2023 table. Because the SERP is a nonqualified deferred compensation plan, the Company is not obligated to fund it. 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 2023 Annual Report for a discussion of the benefit obligation.
The following table shows the present value of the accumulated SERP benefit payable to each of the NEOs, based on the number of years of service credited under the Plan to each NEO and actuarial assumptions consistent with those used in the Company’s 2023 Annual Report to calculate the Company’s obligations under the Plan. See the notes to the financial statements contained within the Company’s 2023 Annual Report for a discussion of the benefit obligation and assumptions used.
(a) Age Age is as of February 3, 2024, the last day of the fiscal year. (b) Number of Years Credited Service Although Erik Nordstrom and Peter Nordstrom each have 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 Erik Nordstrom, Peter Nordstrom and Kenneth Worzel have met the minimum full retirement age of 58 with at least 10 years of credited service and would be eligible to receive the SERP benefit having the present values as shown in the table.
Nonqualified Deferred Compensation The Company offers participation in the NDCP to eligibleemployees, including the 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
The following table discloses information on nonqualified deferred compensation for the NEOs under the Company’s NDCP for the fiscal year ended
(a) Executive Contributions in Last Fiscal Year The amounts reported are the deferrals made during the fiscal year. (b) Aggregate Earnings in Last Fiscal Year The amounts include the total interest or other earnings (loss) accrued in fiscal year (c) Aggregate Withdrawals/Distributions The amounts shown for Michael Maher are the total NDCP distributions made during the fiscal year based on his distribution elections. (d) Aggregate Balance at Last Fiscal The amounts shown are the total NDCP balances, including earnings on deferrals, as of
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 NEOs’ employment had terminated on
The Company does not have employment agreements with any Nordstrom employees, including the NEOs. The Company maintains an executive severance plan to provide certain NEOs an appropriate level of severance benefits in the event of involuntary separation of service, not for cause. Except as described on the following pages, there are no agreements, arrangements or plans that entitle the NEOs to enhanced benefits upon termination of their employment.
The following table shows various termination scenarios and payments that would be triggered under the Company’s compensation
(a) Continued or Accelerated Vesting of Equity Awards As of the end of fiscal year Stock Options •Death or Disability The stock option agreements under the Company’s The 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 the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and any shares of Common Stock delivered under such grants will be automatically forfeited. •Retirement or Termination The
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 the post-separation vesting and exercise rights will cease immediately and all outstanding vested and unvested options and any shares of Common Stock delivered under such grants will be automatically forfeited. •Qualifying Termination Following a Change in Control •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 RSUs •Death or Disability The RSU agreements under the The amounts If, during the term of any outstanding grant, the •Retirement or Termination The RSU agreements for annual grants under the The If, during the term of any outstanding grant, the •Qualifying Termination Following a Change in Control The amounts
PSUs •Death or Disability The PSU agreements under the 2019 EIP provide 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 payout, based on target performance. The amounts in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values of the prorated PSUs at a payout of 100% (target) based on termination on the last day of fiscal year 2023. If, during the term of any outstanding grant, the participant 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 PSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited. •Retirement or Termination Without Cause The PSU agreements under the 2019 EIP provide that if a participant satisfies a minimum age and years of service requirement and the The amounts in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values of the prorated number of PSUs at a 75% payout that would have been earned if the end of the performance cycles for their grants and retirement dates had both occurred on If, during the term of any outstanding grant, the participant 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 PSUs and any Common Stock delivered on vesting under such grants will be automatically forfeited. •Qualifying Termination Following a Change in Control The PSU grants under the 2019 EIP do not provide for any payment or accelerated benefit upon a change in control. In the event of a change of control, outstanding awards shall continue in effect or be assumed, or an equivalent award substituted, by the successor corporation. If a participant experiences a qualifying termination (termination by the Company without cause or termination by the participant for good reason) within 12 months following a change in control of the Company, then the unvested PSUs will vest in full based on the CPCC’s assessment of performance through the date of the qualifying termination, or if such performance is indeterminable at that time, at the 100% “target” level of performance. Notwithstanding, if the successor corporation refuses to assume or substitute the award, then the CPCC shall provide for the cancellation of the vested portion of any such award in exchange for either an amount of cash (or stock, other securities or other property) and provide for the cancellation of the unvested portion of the award, If the performance cycles for the PSU grants had ended as of the close of fiscal year 2023, 75% of the outstanding PSUs would have been earned. The amounts in the table for Erik Nordstrom, Peter Nordstrom and Kenneth Worzel include the values of unvested PSUs at a 75% payout that would vest if they experienced a qualifying termination within 12 months following a change in control of the Company. (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 •Death The amounts shown are the present values of the 50% survivor annuity, payable in equal installments to the spouse or life partner of the executive, and would continue for the remaining lifetime of the spouse or life partner. •Disability The amounts shown for Erik Nordstrom,
•Retirement or Termination The amounts shown for Erik Nordstrom, •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 The amounts shown for Erik Nordstrom, 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 (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 eligible 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 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, Cathy Smith, Jason Morris and Kenneth Worzel Erik Nordstrom and Peter Nordstrom are not eligible under the Plan. •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 on the following 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
(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 (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.
Pay Ratio Disclosure SEC rules require that U.S. publicly traded companies disclose the ratio of their PEO’s compensation to that of their median employee. Our PEO is our CEO, Erik Nordstrom. For fiscal year •the annual total compensation of Erik Nordstrom was •the estimated median of the annual total compensation of all employees of our Company, other than Erik Nordstrom, was Based on this information, for 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 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 PAY VERSUS PERFORMANCE DISCLOSURE We are required by SEC rules to disclose the following information regarding compensation paid to our NEOs. The amounts set forth under the headings “Compensation Actually Paid to CEO” and “Average Compensation Actually Paid for non-CEO NEOs” have been calculated in a manner consistent with Item 402(v) of Regulation S-K. Footnote (d) sets forth the adjustments from the Total Compensation for each NEO reported in the Summary Compensation Table. The following table sets forth additional compensation information for our CEO and our non-CEO NEOs, along with total shareholder return, net earnings and Incentive Adjusted EBIT performance results for fiscal years 2020, 2021, 2022 and 2023:
(a) NEOs included in the compensation columns reflect the following:
(b) Fair value or change in fair value Compensation Actually Paid (“CAP”) was calculated by beginning with the total amount reported in the Summary Compensation Table (“SCT”)for the applicable year, (i) subtracting the grant date fair value of stock awards reported in the Stock Awards column of the SCT (“Stock Awards”), (ii) subtracting the grant date fair value of option awards reported in the Option Awards column of the SCT (“Option Awards”), (iii) subtracting the actuarial present value of the accumulated benefit under defined benefit plans reported in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column of the SCT (“Change in Pension Value”), (iv) adding the change in fair value of stock and option awards for the applicable year and (v) adding the service cost and prior service cost for all defined benefit plans for the applicable year. Fair value amounts were computed in a manner consistent with the fair value methodology used to account for stock-based compensation in accordance with ASC 718 and for PSUs, adjusted based on the probable achievement at each measurement date. The fair value amounts were calculated using our stock price on the last day of each fiscal year or the date of vesting, as applicable. The service cost and prior service cost for defined benefit plans were calculated using the same methodology as used for our financial statements under GAAP. (c) Year-end stock price For the portion of CAP that is based on year-end stock prices, the following prices were used for 2023: $18.12 (2% decrease change from prior year), for 2022: $18.42 (16% decrease change from prior year), for 2021: $21.85 (38% decrease change from prior year), and for 2020: $35.45 (4% decrease change from prior year). (d) Compensation Actually Paid to CEO and non-CEO NEOs CAP for the CEO and non-CEO NEOs reflects the adjustments from Total Compensation for each respective year reported in the SCT, as shown on the following table. Total Adjustments are calculated using un-rounded numbers and then rounded to the nearest dollar.
(e) TSR and Peer Group TSR Peer Group TSR reflects the S&P Retail Index as reflected in our 2023 Annual Report pursuant to Item 201(e) of Regulation S-K for the fiscal year ended February 3, 2024. Each year of TSR and Peer Group TSR reflects what the cumulative value of $100 would be, including the reinvestment of dividends, if such amount were invested on February 1, 2020. (f) Company-Selected Measure As discussed in the Compensation Discussion & Analysis on page 44, the NEOs’ bonus opportunity for 2023 was weighted heavily on Incentive Adjusted EBIT subject to achievement of the Incentive Adjusted ROIC threshold, at 100% weighting for Erik and Peter Nordstrom and 75% weighting for all other NEOs.
We believe the CAP in each of the years reported over the three-year cumulative period are reflective of the CPCC’s emphasis on “pay-for-performance” as the CAP fluctuated year over year, primarily due to stock performance and our varying levels of achievement against pre-established performance goals under our EMBPand PSUs. The relationship between CAP, TSR and Peer Group TSR is shown below. The relationship between CAP and Net Earnings is shown below.
The relationship between CAP and Incentive Adjusted EBIT is shown below.
The following table lists our most important performance measures used to link CAP for our NEOs to Company performance in 2023. Incentive Adjusted ROIC is used to determine bonus payouts for each of the NEOs as described on page 43 and cumulative sales and EBIT margin % are used to determine 2023 PSU payouts for the NEOs as described on page 45.
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 At the 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.
As described in the CD&A beginning on page •We deliver the majority of compensation through a pay-for-performance framework where incentives are based on achieving results. At least •Each year, the CPCC establishes the performance-based bonus measures that focus executives on the most important Company objectives. In •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 •The CPCC has retained and directs an independent compensation consultant. •We do not have employment agreements with our executives. • •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.
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 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
(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 (c)Includes (d)Consist of plans 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 NEOs, and by all Directors and Executive Officers of the Company as a group. Except as otherwise noted, each of the reporting persons has sole voting and investment power with respect to the shares listed. Except as otherwise noted, all information is as of March
* Does not exceed 1% of the Company’s outstanding Common Stock.
(a) Erik B. Nordstrom Amount and nature of beneficial ownership includes: • • •42,646 shares owned by his wife individually; and •199,595 shares held by a trust of which he is the trustee. (b) 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; • • •175,533 shares owned by his wife individually; • •49,060 shares held by trusts of which he is the trustee; and • (c) Kenneth J. Worzel Amount and nature of beneficial ownership includes: • • • • (d) Amount and nature of beneficial ownership includes: • (e) Stacy Brown-Philpot Amount and nature of beneficial ownership includes: • • Amount and nature of beneficial ownership includes: • (g) Glenda G. McNeal Amount and nature of beneficial ownership includes: • Amount and nature of beneficial ownership includes: • Amount and nature of beneficial ownership includes: • (j) Michael W. Maher Mr. Maher served as the Company’s interim Chief Financial Officer until June 16, 2023. Beneficial ownership information for Mr. Maher is based on the contents of a Form 4 filed by Mr. Maher with the SEC on March 10, 2023, adjusted to give effect to subsequent transactions of which the Company is aware in connection with employment-related equity awards: •14,311 shares owned by him directly. Amount and nature of beneficial ownership includes: •14,146 shares owned by her directly. (l) Atticus N. Tysen Amount and nature of beneficial ownership includes: •10,031 shares owned by him directly. (m) Eric D. Sprunk Amount and nature of beneficial ownership includes: •8,103 shares owned by him directly. (n) Guy B. Persaud Amount and nature of beneficial ownership includes: •4,983 shares owned by him directly. (o) Jason Morris Amount and nature of beneficial ownership includes: •0 shares owned by him directly. (p) Cathy R. Smith Amount and nature of beneficial ownership includes: •0 shares owned by her directly. Collectively, the combined amount and nature of beneficial ownership for the Directors and all Executive Officers include: •
• • • • • Pursuant to a Schedule 13G filing made with the SEC, as of December 31, •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. Pursuant to a Schedule 13G filing made with the SEC, as of September 8, 2022, the aggregate amount beneficially owned by El Puerto de Liverpool, S.A.B. de C.V. includes: •15,755,000 shares for which it has sole power to vote or to dispose or to direct disposition. (t) Anne E. Gittinger Pursuant to a Schedule 13G filing made with the SEC, as of December 31, • Pursuant to a Schedule 13G filing made with the SEC, as of December • • • (v) BlackRock, Inc. Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2023, the aggregate amount beneficially owned by BlackRock, Inc. includes: •8,544,954 shares for which it has the sole power to vote or to direct the vote; and •8,866,520 shares for which it has sole power to dispose or to direct disposition. (w) State Street Corporation Pursuant to a Schedule 13G filing made with the SEC, as of December 31, 2023, the aggregate amount beneficially owned by State Street Corporation includes: •3,082,721 shares for which it has shared power to vote or to direct the vote; and •8,301,506 shares for which it has shared power to dispose or to direct disposition. Delinquent Section 16(a) Reports 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 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 CGNC 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 CPCC 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 CPCC will approve or ratify the transaction or transactions only if the CPCC determines that the transaction is reasonable and fair to the Company.
Related Party Transactions During the fiscal year ended 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 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 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 (other than a proposal pursuant to Rule 14a-8) for an annual meeting not less than 90 days nor more than 120 days before the first anniversary of the prior year’s meeting. •However, if we hold the •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. All Director nominations and items of business, other than shareholder proposals made pursuant to Rule 14a-8 under the Exchange Act, must comply with the requirements of the Company’s Bylaws. Any notice of a Director nomination must also comply with all the requirements of Rule 14a-19. The requirements of Rule 14a-19 are in addition to the requirements under our Bylaws with respect to advance notice of Director nominations. Our Bylaws provide that notice of a proposed nomination must include certain information about the nominating shareholder, related parties, and FREQUENTLY ASKED QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
We have made these materials available to you on the
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. You are entitled to participate in the Annual Meeting if you were a shareholder as of the close of business on the Record Date or hold a valid proxy for the meeting. To be admitted to the Annual Meeting at virtualshareholdermeeting.com/ Whether or not you plan to participate in the Annual Meeting, it is important that your shares be part of the voting process. This year’s shareholder question and answer session will include questions submitted in advance of, and questions submitted live during, the Annual 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/ We encourage you to access the Annual Meeting before it begins. Online check-in will start shortly before the meeting on May
We are furnishing proxy materials to our shareholders primarily via the internet, as the holders of a majority of our shares 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 The Notice of Internet Availability of Proxy Materials 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 of Internet Availability of Proxy Materials. If you have previously chosen to receive our proxy materials electronically, you will receive access to these materials via email unless you elect otherwise.
A proxy statement is a document that SEC rules require us to provide you when 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 the shares you own at a meeting of our shareholders. By signing the proxy card we provide to you, you will designate
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 virtual 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 virtual Annual Meeting. Your broker, bank, trustee or nominee is obligated to provide you with a voting instruction form for you to use.
We encourage you to vote in advance of the meeting on the internet or by telephone. It is convenient, and it saves us significant postage and processing costs. In addition, when you vote on the internet 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 the Annual Meeting virtually. Shareholders of record: The internet 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.
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. 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 Shareholders holding shares purchased through the Company’s ESPP: If you hold Common Stock that you acquired through the Company’s ESPP, you are the beneficial owner of those shares and your shares may be voted as described above for street name shareholders.
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 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.
SEC rules allow us to use a procedure called “householding” to deliver only one copy of our Notice, and for those shareholders that received a paper copy of proxy materials in the mail, one copy of our
We will have a quorum and will be able to conduct the business of the Annual Meeting if at least To elect Directors and adopt the other proposals, the following votes are required:
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 answers to Questions 13.and 14.) and abstentions are not considered “votes cast” and have no effect on the proposals. Washington corporation law does not provide shareholders any dissenters’ or appraisal rights with respect to the matters to be voted on at the Annual Meeting, and shareholders do not have cumulative voting rights with respect to the election of directors.
•Election of •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 •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.
Yes, if you are a shareholder of record and 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 internet or by telephone prior to the Annual Meeting; •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 •delivering your proxy or casting a ballot during the meeting. If you are a street name shareholder, you should contact your bank, broker or other holder of record to revoke your proxy or change your vote.
•Shareholders of record: If you are a registered shareholder and do not vote by internet 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. If you submit a validly executed proxy card with no voting designation at all, your shares will be voted: for each of the Board’s nominees to be elected on Proposal 1 and for Proposals 2 and 3. •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 •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
If you abstain from voting on a proposal, or if a broker or bank casts a discretionary vote on the ratification of Deloitte but it indicates it does not have discretionary authority to vote on
Broadridge was appointed by the Board to tabulate the vote and act as Inspector of Election. Information about Broadridge is available at 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.
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 the Investor Relations Website.
Shareholders and other interested parties may communicate with Directors by contacting the Corporate Secretary’s
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. 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 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:
Your concerns will be investigated and communicated to the AFC, as necessary.
You may e-mail Investor Relations at InvRelations@Nordstrom.com, or call the Corporate Secretary’s Office at 206-303-2541.
Incentive Adjusted ROIC and Incentive Adjusted EBIT 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 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. We define Incentive Adjusted ROIC as our adjusted net operating profit after tax divided by our average invested capital. Incentive Adjusted EBIT represents net earnings before income tax expense, interest expense and interest income, and contemplates non-operating related adjustments. These metrics are not measures of financial performance under GAAP and should be considered in addition to, and not as a substitute for, return on assets, net earnings, total assets or other GAAP financial measures. Our method of calculating a non-GAAP financial measure may differ from other companies’ methods and therefore may not be comparable to those used by other companies. 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. The following
(a) (b) Operating lease interest is a component of operating lease cost recorded in occupancy costs. We add back operating lease interest for purposes of calculating adjusted net operating profit for consistency with the treatment of interest expense on our debt. (c) (d) For leases with property incentives that exceed the right-of-use assets, we reclassify the amount from assets to other current liabilities and other liabilities on the Consolidated Balance Sheets. The current and noncurrent amounts are used to reduce average total assets above, as this better reflects how we manage our business.
The following is a reconciliation of net (loss) earnings
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