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<Exhibit 10.2>
Nordstrom, Inc.
1997 Stock Option Plan
Performance Share Unit Award Agreement
AN AWARD FOR PERFORMANCE SHARE UNITS for the number of shares of Common
Stock (hereinafter the "Unit") as noted on your Notice of Award of
Performance Share Units (the "Notice"), of Nordstrom, Inc., a
Washington Corporation (the "Company"), is hereby granted to the
"Unitholder" on the date set forth on your Notice, subject to the
terms, definitions and provisions of the Nordstrom, Inc.
1997 Stock Option Plan (the "Plan") adopted by the Company, which is
incorporated by reference herein. Each Unit is equal in value to one
share of Nordstrom stock. The Units are subject to the following:
1. VESTING AND SETTLEMENT OF UNITS. Units shall vest and be settled in
accordance with the provisions of the Plan as follows:
(a) VESTING. Units shall vest at the applicable percentage if the
Company's Total Shareholder Return (TSR) performance relative to the
TSR of other companies in the comparator group exceeds the
corresponding percentile, as set forth below, three years from the
February 1 preceding the date of the Award.
Percentile of Rank Percent of Units Vested
> 85% 125%
> 75% 100%
> 65% 85%
> 50% 75%
< = 50% 0%
(b) SETTLEMENT. Units shall be settled upon vesting, unless the
Unitholder has elected to defer the Units into the Executive Deferred
Compensation Plan (EDCP). Such election must be in writing, must be
executed at least twelve (12) months prior to the beginning of the Plan
Year in which the Units vest, and must be irrevocable. Upon deferral,
the vested Units (and their subsequent settlement and payment) shall be
governed by the terms and conditions of the EDCP as that plan may be
amended from time to time by the Company.
At the time of settlement, unless deferred into the EDCP, the
Unitholder shall receive one share of Common Stock for each vested
Unit. Alternatively, the Unitholder may elect to receive an equivalent
amount of cash. The amount of cash will be determined on the basis of
the market value of the Common Stock at the time of vesting.
(c) WITHHOLDING TAXES. No stock certificates or cash will be
distributed to the Unitholder unless the Unitholder has made acceptable
arrangements to pay any withholding taxes that may be due as a result
of the settlement of this Award. These arrangements may include
withholding shares of Common Stock that otherwise would be distributed
when the Units are settled. These arrangements may also include
surrendering shares of the Common Stock already owned. The fair market
value of these shares, determined as of the date when taxes otherwise
would have been withheld in cash, will be applied to the withholding
taxes.
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(d) RESTRICTIONS ON RESALE. The Unitholder agrees not to sell any
shares of the Company's stock at a time when applicable laws or Company
policies prohibit a sale. This restriction will apply as long as the
Unitholder is an employee, consultant or director of the Company or a
subsidiary or affiliate of the Company.
2. TERMINATION OF EMPLOYMENT. Except as set forth below, Units vest and
may only be settled while the Unitholder is an employee of the Company.
If the Unitholder's employment is terminated, the Units shall continue
to vest pursuant to the schedule set forth in subparagraph 1(a) above
and the Unitholder or his or her legal representative shall have the
right to settlement of the Units after such termination as follows:
(a) If the Unitholder dies, the persons to whom the Unitholder's rights
have passed by will or the laws of descent and distribution shall be
entitled to settlement of the Units. Unitholder's beneficiary(ies) shall
be entitled to a prorated payment with respect to Units earned during
the Performance Cycle.
(b) If the Unitholder's employment is terminated due to his or her
disability, as defined in Section 22(e)(3) of the Internal Revenue
Code, Unitholder shall be entitled to a prorated payment with respect
to Units earned during the Performance Cycle.
(c) If the Unitholder's' employment is terminated due to his or her
retirement upon attaining age 50 with 10 years of service to the
Company or age 60, Unitholder shall be entitled to a prorated payment
with respect to Units earned during the
Performance Cycle.
(d) If the Unitholder's employment is terminated for any reason other
than those set forth in subparagraphs (a), (b) and (c) above, Units, to
the extent not vested and settled as of the date of his or her
termination, shall be forfeited as of that date.
Notwithstanding anything above to the contrary, if during the term of
this Award, Unitholder directly or indirectly, either as an employee,
employer, consultant, agent, principal, partner, shareholder, corporate
officers, director or in any other capacity, engages or assists any
third party in engaging in any business competitive with the Company;
divulges any confidential or proprietary information of the Company to
a third party who is not authorized by the Company to receive the
confidential or proprietary information; or uses any confidential or
proprietary information of the Company, then the post-termination
proration of Units and settlement rights set forth above shall
immediately cease and all outstanding vested and unvested portions of
the Award shall be automatically forfeited.
3. TERM. Units not vested after three (3) years from the February 1
preceding the original grant of this Award shall be forfeited as of
that date.
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4. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. As provided in the Plan,
the number and kind of shares of Company stock subject to this Award
shall be appropriately adjusted to reflect any stock dividend, stock
split, split-up or any combination or exchange of shares, however
accomplished.
5. ADDITIONAL UNIT. The Committee may or may not grant you additional
performance share units in the future. Nothing in this Award or any
future award should be construed as suggesting that additional unit
awards to you will be forthcoming.