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Exhibit 10.2
Performance Share Unit Award Agreement
2007
AN AWARD FOR PERFORMANCE SHARE UNITS (PSUs) for the number of
shares of
Common Stock (hereinafter the "Units") as noted in the 2007 Notice
of
Award of Performance Share Units (the "Notice"), of Nordstrom,
Inc., a
Washington Corporation (the "Company"), is hereby granted to the
"Unit
holder" on the date set forth in the Notice. The Units are subject
to
the terms, definitions and provisions of the Nordstrom, Inc.
2004
Equity Incentive Plan (the "Plan") adopted by the Board of
Directors of
the Company and approved by the Company's shareholders, which
is
incorporated in this Agreement. Each vested Unit is equal in value
to
one share of Nordstrom stock. To the extent inconsistent with
this
Agreement, the terms of the Plan shall govern. The Compensation
Committee of the Board has the discretionary authority to construe
and
interpret the Plan and this Agreement. The Units are subject to
the
following:
1. VESTING AND
SETTLEMENT OF UNITS
At the end of three fiscal years following the date of the Award
("the
Performance Cycle"), Units shall vest and be settled in
accordance
with the provisions of the Plan as follows:
(a) Vesting
Except as set forth in Section 2, Units shall vest at the
applicable percentage when the Compensation Committee of the
Board
certifies that (1) the Company's Total Shareholder Return (TSR)
is
positive, and (2) its TSR performance relative to the TSR of
other
companies in the peer group exceeds the following corresponding
percentile rankings. For purposes of determining the Company's
TSR
relative to the TSR of other companies in the peer group, the
share
price of the Common Stock of the Company, and the share prices
of
the companies in the peer group, shall be based on a thirty
(30)
trading day average established prior to the start of the
Performance Cycle and a thirty (30) trading day average
established
at the end of the Performance Cycle.
<table>
<c>
<c>
Percentile Ranking
Vesting %
100.00%
125%
93.00%
125%
86.00%
125%
80.00%
100%
73.00%
85%
66.00%
85%
60.00%
75%
53.00%
75%
0 - 50.00%
0%
</table>
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The relative percentile rankings may change during the
Performance
Cycle based upon mergers, acquisitions, dissolutions and other
industry consolidation involving the companies in the peer
group.
Generally, PSUs will be vested if the Nordstrom TSR for the
three-
year period following the grant is in the top half of
performers
relative to the other companies in the peer group.
(b) Settlement
Units shall be settled upon vesting, unless the Unit holder has
elected to defer the Units into the Executive Deferred
Compensation
Plan (EDCP). Such deferral election must be in writing, must be
executed at least six months prior to the last day of the
Performance Cycle 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 earlier deferred into the
EDCP,
the Unit holder shall elect to receive one share of Common
Stock
for each vested Unit or receive an equivalent amount of cash
(in
accordance with procedures established by the Company). The
amount
of cash will be determined on the basis of the market value of
the
Common Stock on the last day of the Performance Cycle,
determined
at the time of vesting.
(c) Withholding
Taxes
No stock certificates or cash will be distributed to the Unit
holder, or amounts deferred into the EDCP, unle
