Edgar Filing: NORDSTROM INC

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12

NORDSTROM, INC.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

---------------------------------------------------------------------

(2) Aggregate number of securities to which transaction applies:

---------------------------------------------------------------------

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

---------------------------------------------------------------------

(4) Proposed maximum aggregate value of transaction:

---------------------------------------------------------------------
(5) Total fee paid:

---------------------------------------------------------------------

[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

---------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

---------------------------------------------------------------------
(3) Filing Party:

---------------------------------------------------------------------
(4) Date Filed:

---------------------------------------------------------------------
2

Nordstrom logo

April 11, 2001

DEAR SHAREHOLDERS:

On behalf of the Board of Directors and management, I cordially invite you to
attend the Annual Meeting of Shareholders on Tuesday, May 15, 2001, at 11:00
a.m., Pacific Daylight Time, at the John W. Nordstrom Room, Downtown Seattle
Nordstrom, 1617 Sixth Avenue, 5(th) Floor, Seattle, Washington, 98101-1742.

In addition to the matters described in the Notice of Annual Meeting and Proxy
Statement, there will be a report on the progress of the Company and an
opportunity to ask questions of general interest to you as a Shareholder.

YOUR VOTE IS VERY IMPORTANT. Therefore, whether or not you plan to attend the
meeting in person, please sign and return the enclosed Proxy in the envelope
provided. If you attend the meeting and desire to vote in person, you may do so
even though you have previously sent your Proxy.

I hope you will be able to join us and we look forward to seeing you in Seattle.

Sincerely yours,

/s/ BLAKE W. NORDSTROM
Blake W. Nordstrom
President
3

NORDSTROM, INC.
1617 SIXTH AVENUE
SEATTLE, WASHINGTON
98101-1742

NOTICE OF ANNUAL
MEETING OF
SHAREHOLDERS To the Shareholders of
Nordstrom, Inc.:

The Annual Meeting of Shareholders of Nordstrom, Inc. will
be held on Tuesday, May 15, 2001, at 11:00 a.m., Pacific
Daylight Time, at the John W. Nordstrom Room, Downtown
Seattle Nordstrom, 1617 Sixth Avenue, 5(th) Floor,
Seattle, Washington, 98101-1742 for the following
purposes:

1. To elect nine directors to hold office until the next
Annual Meeting of Shareholders and until their successors
are duly elected and qualified; and

2. To ratify the appointment of auditors.

If they are presented, you also will be asked to vote on
the following:

3. A Shareholder proposal regarding performance-based
executive compensation;

4. A Shareholder proposal regarding vendor standards
compliance mechanisms; and

5. A Shareholder proposal regarding global human rights
standards.

Such other business as may properly come before the
meeting and any adjournment thereof may also be addressed.

Holders of shares of Common Stock of record at the close
of business on March 19, 2001 are entitled to notice of,
and to vote at, the meeting.

Shareholders are cordially invited to attend the meeting
in person.

By order of the Board of Directors,

/s/ N. CLAIRE CHAPMAN
N. Claire Chapman
Secretary

Seattle, Washington
April 11, 2001

WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE
MEETING, YOU ARE ENCOURAGED TO SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE
ENVELOPE PROVIDED.
4

PROXY STATEMENT
APPROXIMATE
MAILING DATE:
APRIL 11, 2001 This Proxy Statement is furnished to the Shareholders of
Nordstrom, Inc. in connection with the solicitation of
proxies by the Board of Directors for use at the Annual
Meeting of Shareholders to be held on May 15, 2001 and any
adjournment thereof. If the enclosed Proxy is executed and
returned, it will be voted in accordance with the
instructions given, but may be revoked at any time if it
has not been exercised by notifying the Secretary of the
Company in writing. Each Proxy will be voted for Proposals
1 and 2, and, if they are presented, against Proposals 3,
4 and 5, and may be voted on such other matters as may
properly come before the Annual Meeting if no contrary
instruction is indicated on the Proxy. There were
133,801,918 shares of Common Stock, the only security of
the Company entitled to vote at the Annual Meeting,
outstanding as of March 19, 2001, which is the record date
for the Annual Meeting. Shareholders are entitled to one
vote for each share of Common Stock held of record at the
close of business on March 19, 2001. Under Washington law
and the Company's Amended and Restated Articles of
Incorporation, a quorum consisting of a majority of the
shares eligible to vote must be represented in person or
by proxy to elect directors and to transact any other
business that may properly come before the Annual Meeting.
For election of directors, the nominees elected will be
those receiving the greatest number of votes cast by the
shares entitled to vote, up to the number of directors to
be elected. Any action other than a vote for a nominee
will have the effect of voting against the nominee. The
appointment of auditors will be ratified and the
Shareholder proposals will be adopted if the votes cast in
favor of the respective action exceed the votes cast
against it. Abstentions and nonvotes by brokers will have
no effect since such actions do not represent votes cast
by Shareholders.

1
5

SECURITY OWNERSHIP OF The following table sets forth, as of March 19, 2001, the
CERTAIN BENEFICIAL number of shares of Common Stock held by beneficial owners
OWNERS AND of more than five percent of the Company's Common Stock, by
MANAGEMENT directors and director nominees, by the executive officers
named in the Summary Compensation Table on page 8, and by
all directors and executive officers of the Company as a
group:

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Amount and
Nature of
Beneficial Percent
Name of Beneficial Owner Ownership of Class

----------------------------------------------------------------------------------------
DODGE & COX 12,670,528(a) 9.47%
One Sansome St., 35th Floor
San Francisco, California 94101
ELMER AND KATHARINE NORDSTROM 12,048,852(b) 9.00%
FAMILY INTERESTS, L.P.
c/o 1617 Sixth Avenue
Seattle, Washington 98101
BRUCE A. NORDSTROM 10,779,513(c)(d) 8.06%
c/o 1617 Sixth Avenue
Seattle, Washington 98101
D. WAYNE GITTINGER 10,500,866(c)(e) 7.85%
1420 Fifth Avenue, Suite 4100
Seattle, Washington 98101
JOHN N. NORDSTROM 3,511,714(c)(f) 2.62%
PETER E. NORDSTROM 1,009,968(g) *
BLAKE W. NORDSTROM 999,139(h) *
JOHN A. MCMILLAN 292,533(c) *
MICHAEL A. STEIN 125,627 *
JOHN J. WHITACRE 120,140(i) *
MARTHA S. WIKSTROM 53,638(j) *
GAIL A. COTTLE 53,169(k) *
DALE CAMERON (CRICHTON) 49,576(l) *
WILLIAM D. RUCKELSHAUS 15,713 *
ALFRED E. OSBORNE, JR. 10,563(m) *
ANN MCLAUGHLIN KOROLOGOS 5,713 *
BRUCE G. WILLISON 5,201(n) *
MICHAEL G. KOPPEL 3,870(o) *
ENRIQUE HERNANDEZ, JR. 3,635(p) *
ALISON A. WINTER 1,300(q) *
Directors and executive officers as a group (34 persons) 41,215,403(r) 39.93%

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

* Does not exceed 1% of the Company's outstanding Common Stock.
(a) Based on an amended Schedule 13G filed on February 14, 2001 pursuant to the
Securities Exchange Act of 1934, which indicates that Dodge & Cox has sole
investment power with respect to all of

2
6

these shares, sole voting power with respect to 11,773,328 shares, and shared
voting power with respect to 95,300 shares.
(b) The general partners of this partnership are the Estate of Katharine J.
Nordstrom (John N. Nordstrom, executor), The Elected Marital Trust under the
Will of Elmer J. Nordstrom (John N. Nordstrom, trustee), the James F. Nordstrom
Interests, L.P., and the John N. Nordstrom Interests, L.P. The general partners
of the James F. Nordstrom Interests, L.P. are Sally A. Nordstrom, the Estate of
James F. Nordstrom (Sally A. Nordstrom, executor), J. Daniel Nordstrom and
William E. Nordstrom, and the general partners of the John N. Nordstrom
Interests, L.P. are John N. Nordstrom, Sally B. Nordstrom, and James A.
Nordstrom. Each of these entities and individuals are deemed to beneficially own
the shares held by the Elmer and Katharine Nordstrom Family Interests, L.P. Each
of the general partners disclaims beneficial ownership of the shares held by the
Elmer and Katharine Nordstrom Family Interests, L.P. that exceeds the greater of
their proportionate interest in their respective profits or capital account in
the partnership.
(c) Does not include 160,000 shares held by a corporation, of which the director
or his spouse owns a one-eighth beneficial interest.
(d) Includes 83,388 shares held by his wife individually; and 4,235,280 shares
held by trusts, of which he is a trustee and beneficiary. Does not include
3,485,564 shares held by trusts, of which he is a co-trustee.
(e) Includes 6,944,626 shares held by his wife individually; 783 shares held by
his wife as a participant in the Company's 401(k) Plan; 777,600 shares held by a
trust, of which his wife is a trustee and beneficiary; and 2,750,760 shares held
by a trust, of which his wife is the beneficiary. Does not include 206,896
shares held by trusts of which he is a trustee.
(f) Includes 161,610 shares held by his wife; 4,012 shares held by trusts, of
which he is the trustee; and 2,780,000 shares held by the John N. Nordstrom
Interests, L.P., of which he is a general partner. John N. Nordstrom disclaims
beneficial ownership of the shares held by the John N. Nordstrom Interests, L.P.
that exceeds the greater of his proportionate interest in his profits or capital
account in the partnership. Does not include any of the shares held by the Elmer
and Katharine Nordstrom Family Interests, L.P., of which he is deemed a
beneficial owner.
(g) Includes 95,801 shares that may be acquired under the 1987 and 1997 Stock
Option Plans; and 6,639 shares held by him in the Company's 401(k) Plan.
(h) Includes 179,160 shares held by his wife individually; 18,012 shares held by
trusts, of which he is a trustee; 5,987 shares held in a custodial account, of
which he is the custodian; 101,847 shares that may be acquired under the 1987
and 1997 Stock Option Plans; and 1,561 shares held by him in the Company's
401(k) Plan.
(i) Includes 108,397 shares that may be acquired under the 1987 and 1997 Stock
Option Plans; and 7,741 shares held in the Company's 401(k) Plan.
(j) Includes 52,007 shares that may be acquired under the 1987 and 1997 Stock
Option Plans; and 1,629 shares held in the Company's 401(k) Plan.
(k) Includes 53,167 shares that may be acquired under the 1987 and 1997 Stock
Option Plans.
(l) Includes 47,478 shares that may be acquired under the 1987 and 1997 Stock
Option Plans.
(m) Includes 600 shares held by his wife; 150 shares held by his wife for
benefit of child; and 2,400 shares held by a corporation, of which he is the
sole shareholder.
(n) Includes 4,000 shares held by a trust, of which he and his spouse are
trustees and beneficiaries.
(o) Includes 3,188 shares that may be acquired under the 1987 and 1997 Stock
Option Plans.
(p) Includes 2,000 shares held by a trust, of which he and his spouse are
trustees and beneficiaries. Does not include 25,000 stock units each convertible
at any time upon the election of Mr. Hernandez, or
3
7

when he ceases to be a member of the Board of Directors, into a dollar amount
equal to the difference in the value of a share of Common Stock on the date the
stock unit was awarded and the value of a share of Common Stock on the date the
stock unit is converted.
(q) Includes 1,000 shares held by a trust, of which she and her spouse are
trustees and beneficiaries; 100 shares held in a custodial account, of which she
is the custodian; 100 shares held by her daughter in an account over which she
shares investment power; and 100 shares held by her husband in a retirement
account over which she shares investment power.
(r) Includes 12,048,852 shares held by the Elmer and Katharine Nordstrom Family
Interests, L.P.; and 2,780,000 shares held by the John N. Nordstrom Interests,
L.P. Also includes 1,141,386 shares that may be acquired by the executive
officers as a group under the 1987 and 1997 Stock Option Plans.

The directors and executive officers shown in the table disclaim beneficial
interest in any shares held solely as custodian or trustee, and all shares held
by their spouses and immediate family members.

4
8

PROPOSAL 1:
ELECTION OF DIRECTORS Nine directors will be elected at the Annual Meeting, each
to hold office until the next Annual Meeting and until a
successor has been duly elected and qualified. Unless
otherwise instructed by the Shareholder, the persons named
in the enclosed Proxy intend to vote for the election of
the persons listed in this Proxy Statement. All of the
nominees except Alison A. Winter are currently directors
of the Company. If any nominee becomes unavailable for any
reason or should a vacancy occur before the election,
which events are not anticipated, the Proxy may be voted
for a person to be selected by the Board of Directors.

NOMINEES

Information related to the director nominees is set forth
below:

-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Principal Occupation and Business Director
Name and Age Experience for Past Five Years Since
-------------------------------------------------------------------------------------------------------

D. WAYNE GITTINGER Partner in the law firm of Lane Powell Spears Lubersky 1971
Age 68(a)(b) LLP
ENRIQUE HERNANDEZ, JR. President and Chief Executive Officer of Inter-Con 1997
Age 45(c) Security Systems, Inc., a California-based worldwide
security and facility support services provider;
Co-Founder and Principal Partner of Interspan
Communications, a television broadcasting company
serving Spanish-speaking audiences
JOHN A. MCMILLAN Retired (formerly Co-Chairman of the Board of 1966
Age 69(d) Directors of the Company)
BRUCE A. NORDSTROM Chairman of the Board of Directors of the Company 1966
Age 67(b)
JOHN N. NORDSTROM Retired (formerly Co-Chairman of the Board of 1966
Age 64(b) Directors of the Company)
ALFRED E. OSBORNE, JR. Director of the Harold Price Center for 1987
Age 56(e) Entrepreneurial Studies and Associate Professor of
Business Economics, The Anderson School at UCLA
WILLIAM D. RUCKELSHAUS A Strategic Director of Madrona Venture Group, a 1985
Age 68(f) Washington-based investment firm (formerly Chairman
and Chief Executive Officer of Browning-Ferris
Industries, Inc.)

5
9

-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Principal Occupation and Business Director
Name and Age Experience for Past Five Years Since
-------------------------------------------------------------------------------------------------------

BRUCE G. WILLISON Dean of The Anderson School at UCLA, formerly 1998
Age 52(g) President and Chief Operating Officer of H.F.
Ahmanson & Company, a California-headquartered
thrift holding company, and Home Savings of America,
a full-service consumer bank, also headquartered in
California. H.F. Ahmanson was the parent company of
Home Savings of America.
ALISON A. WINTER Executive Vice President for Midwest Personal N/A
Age 54(h) Financial Services with The Northern Trust
Corporation, Chicago (formerly President and Chief
Executive Officer of the Northern Trust of
California).
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------

(a) D. Wayne Gittinger is a partner in the law firm of Lane Powell Spears
Lubersky LLP, which rendered legal services to the Company during the fiscal
year ended January 31, 2001.
(b) Bruce A. Nordstrom is a brother-in-law of D. Wayne Gittinger and a cousin of
John N. Nordstrom. Mr. Bruce A. Nordstrom's sons are Blake W. Nordstrom, the
President of the Company, and Erik B. Nordstrom and Peter E. Nordstrom, each of
whom is an Executive Vice President of the Company. Mr. John N. Nordstrom's
nephew is J. Daniel Nordstrom, Chief Executive Officer of NORDSTROM.com, LLC.
(c) Enrique Hernandez, Jr. is also a director of California Healthcare
Foundation, ICSS Holding Corp., McDonald's Corporation, Washington Mutual, Inc.
and Tribune Company.
(d) John A. McMillan is also a director of Lion, Inc. (formerly known as Plenum
Communications).
(e) Alfred E. Osborne, Jr. is also a director of Equity Marketing, Inc. and K2,
Inc., a trustee of the WM Group of Funds, First Pacific Advisors New Income and
Capital Funds, and an independent general partner of Technology Funding Venture
Partners V.
(f) William D. Ruckelshaus is also a director of Coinstar, Inc., Cummins Engine
Company, Pharmacia Corporation (formerly known as Monsanto Company), Solutia
Inc., and Weyerhaeuser Company. He was also a director of the Company from 1978
to 1983.
(g) Bruce G. Willison is also a director of H&CB (Korea), Health Net, Inc., the
Los Angeles Urban League, the United Way of Greater Los Angeles, and the Los
Angeles Sports Council.
(h) Alison A. Winter is also a director of California Healthcare Foundation,
Steppenwolf Theatre Company, River North Dance Company, Chicago Convention and
Tourism Bureau and The Joffrey Ballet Company. She also serves on the Board of
Trustees of Claremont McKenna College.

The Board of Directors recommends a vote FOR each of the nominees listed in the
table.

6
10

BOARD OF DIRECTORS
AND BOARD
COMMITTEES The Board of Directors maintains an Audit Committee, a
Compensation and Stock Option Committee, and a Corporate
Governance and Nominating Committee. These committees do
not have formal meeting schedules, but the Audit Committee
is required to meet at least four times a year, and the
Compensation and Stock Option Committee and the Corporate
Governance and Nominating Committee are each required to
meet at least once a year. During the past year, there
were eight meetings of the Board of Directors, four
meetings of the Audit Committee, five meetings of the
Compensation and Stock Option Committee, and four meetings
of the Corporate Governance and Nominating Committee. Ann
McLaughlin Korologos, an incumbent director who is not
running for re-election at the Annual Meeting, attended
62% of the aggregate number of meetings of the Board of
Directors and Board committees on which she served.

Current members of the Audit Committee are Ann McLaughlin
Korologos, Chair, Enrique Hernandez, Jr., Alfred E.
Osborne, Jr., William D. Ruckelshaus, and Bruce G.
Willison. The Audit Committee is responsible for
recommending the Company's independent auditors and
assisting the Board of Directors in fulfilling its
oversight responsibilities with respect to accounting and
financial reporting, assessment and management of risk and
the internal controls environment, and compliance with
laws and regulations. The Committee meets periodically
with the independent auditors, management and the internal
auditors to review accounting, auditing, internal
accounting controls, financial reporting matters, and
compliance with laws and regulations. The Committee also
meets privately with the independent auditors and the
internal auditors.

Current members of the Compensation and Stock Option
Committee are William D. Ruckelshaus, Chair, Enrique
Hernandez, Jr., Ann McLaughlin Korologos, and Alfred E.
Osborne, Jr. The Compensation and Stock Option Committee
is responsible for determining the overall compensation
levels of certain of the Company's executive officers and
certain of the Company's benefit plans.

Current members of the Corporate Governance and Nominating
Committee are D. Wayne Gittinger, Chair, Enrique
Hernandez, Jr., Ann McLaughlin Korologos, Alfred E.
Osborne, Jr., and William D. Ruckelshaus. The Corporate
Governance and Nominating Committee is primarily
responsible for recommending director nominees to the
Board of Directors. The Committee will consider
recommendations by Shareholders for vacancies on the Board
of Directors. Suggestions may be submitted to the
Company's Secretary.

7
11

COMPENSATION OF
EXECUTIVE OFFICERS IN
THE YEAR ENDED
JANUARY 31, 2001 SUMMARY COMPENSATION TABLE
The following table summarizes compensation paid or
accrued by the Company for services rendered by the
President, four Vice Presidents, the former Chairman of
the Board of Directors, and two former Vice Presidents
(the "Named Executive Officers") for the periods
indicated:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Annual Compensation Long-Term Compensation
----------------------------------------------------------------------------------------------------------------------
Value of
Restricted
Stock Awards/ Number
Name and Principal Fiscal Other Annual Performance of Stock All Other
Position Year(a) Salary Bonus Compensation(b) Shares(c) Options Compensation(d)
----------------------------------------------------------------------------------------------------------------------

BLAKE W. NORDSTROM(E) 2000 $433,333 $0 $25,468 $139,995 19,765 $9,821
PRESIDENT 1999 $383,333 $0 $23,235 $449,990 34,123 $12,464
1998 $277,500 $414,000 $19,703 $337,502 91,466 $13,404
----------------------------------------------------------------------------------------------------------------------
GAIL A. COTTLE 2000 $316,981 $194,688 $22,043 $150,003 21,176 $3,190
EXECUTIVE VICE 1999 $268,333 $201,582 $23,362 $151,882 11,517 $8,994
PRESIDENT 1998 $249,730 $167,128 $16,442 $146,247 38,578 $14,018
----------------------------------------------------------------------------------------------------------------------
DALE CAMERON (CRICHTON) 2000 $291,272 $210,000 $21,541 $104,996 14,824 $2,943
EXECUTIVE VICE 1999 $268,333 $133,979 $28,455 $151,882 11,517 $9,429
PRESIDENT 1998 $259,167 $99,090 $26,046 $146,247 38,578 $14,620
----------------------------------------------------------------------------------------------------------------------
MICHAEL G. KOPPEL 2000 $238,333 $115,337 $35,306 $65,003 9,176 $26,840
VICE PRESIDENT 1999(f) $94,990 $122,701 $53,979 $47,159 11,877 $66,264
1998 $0 $0 $0 $0 0 $0
----------------------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 2000 $329,167 $18,913 $19,530 $104,996 14,824 $9,710
EXECUTIVE VICE 1999 $383,333 $0 $17,737 $449,990 34,123 $12,446
PRESIDENT 1998 $277,500 $414,000 $17,011 $337,502 91,446 $13,389
----------------------------------------------------------------------------------------------------------------------
JOHN J. WHITACRE(G) 2000 $433,333(h) $0 $29,546 $487,496 68,824 $7,716(h)
FORMER CHAIRMAN OF 1999 $625,000 $0 $18,855 $731,243 55,450 $13,719
THE BOARD OF DIRECTORS 1998 $490,000 $805,000 $20,500 $562,513 145,776 $14,933
----------------------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN(I) 2000 $343,333(j) $39,000 $827,332 $390,001 55,059 $1,094(j)
FORMER EXECUTIVE VICE 1999 $496,667 $0 $346,665 $562,507 42,654 $456,581
PRESIDENT 1998 $147,399 $465,193 $61,695 $5,100,006 131,171 $0
----------------------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM(K) 2000 $336,588(l) $0 $97,137 $269,152 38,000 $7,185(l)
FORMER EXECUTIVE VICE 1999 $328,333 $42,504 $42,864 $151,882 8,637 $67,620
PRESIDENT 1998 $260,000 $450,134 $18,648 $146,247 38,578 $13,507
----------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------

(a) The fiscal year of the Company ends January 31 of the following year.

(b) Other Annual Compensation for the fiscal year ended January 31, 2001
includes automobile allowance, parking, personal use of airplane services, and
reimbursements for relocation tax, regular tax, medical, and financial planning.

(c) These amounts represent performance share units granted to the Named
Executive Officers on February 26, 1998, February 25, 1999 and February 22, 2000
(valued as of those dates, respectively). The performance share units vest on
January 31, approximately three years following the date of grant to the extent
that the Company's total shareholder return exceeds that of certain of the
Company's

8
12

competitors during the respective three-year period. As of January 31, 2001, the
performance share units granted on February 26, 1998 were forfeited due to the
failure of the Company to meet the applicable vesting goals. The remaining
performance share units (assuming full vesting) would be valued as follows as of
January 31, 2001:

Blake W. Nordstrom -- $364,448
Gail A. Cottle -- $221,120
Dale Cameron (Crichton) -- $178,146
Michael G. Koppel -- $86,252
Peter E. Nordstrom -- $331,031
John J. Whitacre -- $265,109
Michael A. Stein -- $0
Martha S. Wikstrom -- $86,435

The above notwithstanding, the amount reported in 1998 for Michael A. Stein
represents shares of restricted stock as valued on the date of grant, as
previously disclosed.

(d) All Other Compensation for the fiscal year ended January 31, 2001, includes
the following:

Profit Sharing Plan benefit: Blake W. Nordstrom: $2,550; Gail A. Cottle:
$2,550; Dale Cameron (Crichton): $2,550; Michael G. Koppel: $850; Peter E.
Nordstrom: $2,550; John J. Whitacre: $0; Michael A. Stein: $0; and Martha
S. Wikstrom: $0.

401(k) Plan benefit: Blake W. Nordstrom: $6,800; Gail A. Cottle: $0; Dale
Cameron (Crichton): $0; Michael G. Koppel: $6,800; Peter E. Nordstrom:
$6,800; John J. Whitacre: $6,800; Michael A. Stein: $0; and Martha S.
Wikstrom: $6,800.

Premiums on excess term life insurance: Blake W. Nordstrom: $471; Gail A.
Cottle: $640; Dale Cameron (Crichton): $393; Michael G. Koppel: $245; Peter
E. Nordstrom: $360; John J. Whitacre: $916; Michael A. Stein: $1,094; and
Martha S. Wikstrom: $385.

Relocation Expenses: Michael G. Koppel: $18,945.

(e) Blake W. Nordstrom has served as President since August 31, 2000. Prior to
that date he served as an Executive Vice President.

(f) Michael G. Koppel commenced employment with the Company on August 12, 1999.

(g) John J. Whitacre was employed by the Company through August 31, 2000.

(h) Does not include $4,100,000 paid in connection with John J. Whitacre's
termination of employment with the Company.

(i) Michael A. Stein was employed by the Company from October 15, 1998 through
August 31, 2000.

(j) Does not include $1,040,000 paid in connection with Michael A. Stein's
termination of employment with the Company; $1,105,000 in connection with the
forgiveness of a loan from the Company to him; $807,836 in connection with the
Company's payment of his income tax liability related to the loan forgiveness;
and $2,142,000 representing the value of restricted stock that vested upon his
termination of employment with the Company.

(k) Martha S. Wikstrom was employed by the Company through September 8, 2000.

(l) Does not include $1,500,000 paid in connection with Martha S. Wikstrom's
termination of employment with the Company and $84,505 in connection with the
forgiveness of a loan from the Company to her.

9
13

OPTION GRANTS IN THE FISCAL YEAR ENDED JANUARY 31, 2001

The following table sets forth information concerning
option grants during the fiscal year ended January 31,
2001, to the Named Executive Officers:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Potential Realizable
Value at Assumed
Percent of Annual Rates of Stock
Total Options Price Appreciation for
Number Granted to Exercise or Option Terms
of Options Employees in Base Price ----------------------
Name Granted(a)(b) Fiscal Year Per Share Expiration Date 5% 10%
------------------------------------------------------------------------------------------------------------------

BLAKE W. NORDSTROM 19,765 0.62% $21.25 2/22/2010 $264,060 $669,243
------------------------------------------------------------------------------------------------------------------
DALE CAMERON (CRICHTON) 14,824 0.47% $21.25 2/22/2010 $198,049 $501,941
------------------------------------------------------------------------------------------------------------------
GAIL A. COTTLE 21,176 0.67% $21.25 2/22/2010 $282,911 $717,019
------------------------------------------------------------------------------------------------------------------
MICHAEL G. KOPPEL 9,176 0.29% $21.25 2/22/2010 $122,591 $310,699
------------------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 14,824 0.47% $21.25 2/22/2010 $198,049 $501,941
------------------------------------------------------------------------------------------------------------------
JOHN J. WHITACRE(C) 68,824 2.17% $21.25 2/22/2010 $919,489 $2,330,381
------------------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN(D) 55,059 1.74% $21.25 2/22/2010 $735,588 $1,864,298
------------------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM(E) 38,000 1.20% $21.25 2/22/2010 $507,680 $1,286,680

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

(a) Options are granted at the fair market value of the Company's Common Stock
on the date of the grant. To the extent not already exercisable, options
generally become exercisable upon a sale of the Company or substantially all of
its assets.

(b) These options vest and become exercisable in four equal annual installments
beginning February 22, 2001.

(c ) The options listed were not vested and expired on August 31, 2000, the date
of John J. Whitacre's termination of employment with the Company.

(d) The options listed were not vested and expired on August 31, 2000, the date
of Michael A. Stein's termination of employment with the Company.

(e) The options listed were not vested and expired on September 8, 2000, the
date of Martha S. Wikstrom's termination of employment with the Company.

10
14

OPTION EXERCISES AND YEAR END VALUE TABLE

The following table sets forth information concerning
option exercises and the value of options held at January
31, 2001 by the Named Executive Officers:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Dollar Value of
Number of Unexercised Unexercised, in-the-Money
Number of Options Held at Options held at
Shares Dollar January 31, 2001 January 31, 2001(a)
Acquired on Value --------------------------- ----------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
--------------------------------------------------------------------------------------------------------------

BLAKE W. NORDSTROM 5,008 $26,786 $79,645 $101,089 $57,288 $0
--------------------------------------------------------------------------------------------------------------
DALE CAMERON
(CRICHTON) 0 $0 $37,110 $43,380 $640 $0
--------------------------------------------------------------------------------------------------------------
GAIL A. COTTLE 0 $0 $41,211 $49,639 $39,032 $0
--------------------------------------------------------------------------------------------------------------
MICHAEL G. KOPPEL 0 $0 $894 $20,159 $0 $0
--------------------------------------------------------------------------------------------------------------
PETER E. NORDSTROM 1,862 $39,683 $74,835 $96,148 $46,051 $0
--------------------------------------------------------------------------------------------------------------
JOHN J. WHITACRE 0 $0 $108,397 $0 $17,167 $0
--------------------------------------------------------------------------------------------------------------
MICHAEL A. STEIN 0 $0 $0 $0 $0 $0
--------------------------------------------------------------------------------------------------------------
MARTHA S. WIKSTROM 0 $0 $52,007 $0 $11,174 $0

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(a) Dollar value is based on the market value of the Company's Common Stock on
the date of exercise or at January 31, 2001, as the case may be, minus the
exercise price.

11
15

PENSION PLAN TABLE

The following table sets forth information concerning
estimated annual benefits payable to each of the Named
Executive Officers upon their retirement based upon
indicated years of service (without reduction for any
Profit Sharing Retirement Plan benefits):
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Years of Service(b)
Average Annual ----------------------------------------------------
Compensation(a) 15 20 25 30 35
----------------------------------------------------------------------

$125,000 $ 45,000 $ 60,000 $ 75,000 $ 75,000 $ 75,000
$150,000 $ 54,000 $ 72,000 $ 90,000 $ 90,000 $ 90,000
$175,000 $ 63,000 $ 84,000 $105,000 $105,000 $105,000
$200,000 $ 72,000 $ 96,000 $120,000 $120,000 $120,000
$225,000 $ 81,000 $108,000 $135,000 $135,000 $135,000
$250,000 $ 90,000 $120,000 $150,000 $150,000 $150,000
$300,000 $108,000 $144,000 $180,000 $180,000 $180,000
$400,000 $144,000 $192,000 $240,000 $240,000 $240,000
$450,000 $162,000 $216,000 $270,000 $270,000 $270,000
$500,000 $180,000 $240,000 $300,000 $300,000 $300,000

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(a) The benefits are payable pursuant to the Supplemental Executive Retirement
Plan, which covers officers of the Company and its subsidiaries, including
the Named Executive Officers. The benefits are unfunded and limited to a
maximum of 60% of the monthly average compensation (based solely on the
yearly amounts set forth in the salary and bonus columns of the Summary
Compensation Table) less the actuarial equivalent of any monthly benefits
payable under the Profit Sharing Retirement Plan. The normal annual
retirement benefit provided by the Supplemental Executive Retirement Plan is
2.4% of the monthly average compensation for the highest thirty-six months
measured over the final sixty months of employment or the entire period of
service after age 50, multiplied by the number of years of service with the
Company, up to a maximum of twenty-five years. From this value is subtracted
the monthly annuity that could be purchased at retirement using the lump sum
value of the Profit Sharing Retirement Plan and 401(k) Plan accounts funded
by Company contributions. The remaining amount is the monthly retirement
benefit payable under the Supplemental Executive Retirement Plan.

(b) The credited years of service to the Company for the Named Executive
Officers are set forth below. John J. Whitacre, Michael A. Stein, and Martha
S. Wikstrom each forfeited any rights to benefits payable under the
Supplemental Executive Retirement Plan in connection with their terminations
of employment with the Company.

Blake W. Nordstrom -- 19 years
Dale Cameron (Crichton) -- 30 years
Gail A. Cottle -- 31 years
Michael G. Koppel -- 1 year
Peter E. Nordstrom -- 17 years

12
16

COMPENSATION AND
STOCK OPTION
COMMITTEE
REPORT ON THE
FISCAL YEAR ENDED
JANUARY 31, 2001 The Compensation and Stock Option Committee is comprised
of four directors, and is responsible for setting
compensation levels for the President, the former
Chairman of the Board of Directors, and certain of the
Company's Executive Vice Presidents. The Committee also
consults with the President with respect to the
compensation and benefits for other officers and with
respect to the benefits for certain other employees of
the Company.

COMPENSATION PHILOSOPHY

The Company bases the various components of its
executive compensation program on differing measures of
Company performance and Shareholder value. The overall
goal of the Committee is to develop compensation
programs and policies that are consistent with and
linked to the Company's strategic business objectives,
including management's value-based approach to managing
the Company. The program is designed to:

(i) play a critical role in attracting and
retaining those executives deemed most able to
further its goal of aligning the Company's
interests with creating value for
Shareholders; and

(ii) reward executives for medium- and long-term
Company performance and value created for
Shareholders as measured by a mix of factors,
including increases in Company stock price,
sales increases and earnings, and other
performance-related value drivers, which will
or should increase Shareholder return.

COMPENSATION COMPONENTS

The Company's executive compensation program is based on
three components, each of which furthers a different
objective, but all of which together are intended to
serve the Company's overall compensation philosophy by
more closely aligning the Company's compensation program
with the goal of increasing value for Shareholders.

BASE SALARY. Base salary is reviewed annually based on
the Committee's view of how the management team and the
respective individual contributes to the overall
performance of the Company. Overall performance of the
Company is measured by a number of factors including the
Company's earnings, its performance versus its retail
competitors, its performance versus budget, its
improvement in gross margins, and the Committee's
assessment of management skills. None of these factors
is necessarily given greater weight than any other
factor. The Committee also reviews the median base
salaries for competitors in the specialty retailing
field and other related markets as appropriate,
including companies listed in Standard & Poor's Retail
Store Composite referenced in the Performance Graph on
page 18.

ANNUAL BONUS INCENTIVES. Annual bonus incentives are
intended to reflect the Company's belief that
management's contribution to medium-and long-term
Company performance comes, in part, from improvement in
the Company's earnings, earnings per share, division
sales, inventory turn and gross margins. Annual bonus
incentives for the President, the former Chairman of the
Board of Directors, and certain of the Executive Vice
Presidents were based on various combinations of
earnings per share, earnings, division sales, inventory
turn, gross margin, expense control, and strategic
initiatives. The amount of the respective bonuses has
been based on the achievement of these targets, which,
in turn, relate to pre-estab-

13
17

lished percentages of the respective executive's base
salary. Under this plan, executive officers have not
received any bonus incentives until the applicable
minimum specified performance target was achieved.
Bonuses for the fiscal year ended January 31, 2001 were
paid only to those executive officers who were subject
to targets relating to business unit earnings, division
sales, inventory turn, gross margin, expense control
and, strategic initiatives.

LONG-TERM INCENTIVES. Stock Options. The 1987 Stock
Option Plan expired in August 1997. The 1987 Plan
authorized granting options to key employees or key
managerial personnel of the Company and its
subsidiaries. A number of options granted under this
Plan remain outstanding. The 1997 Stock Option Plan,
adopted for a term of 10 years beginning May 20, 1997,
authorizes granting options to employees of the Company
and its subsidiaries. Both the 1987 and 1997 Stock
Option Plans are administered by the Committee.

The option incentive component of the total compensation
package is intended to retain and motivate executives to
increase total return to Shareholders. Stock options
must be granted at no less than the fair market value of
the Company's Common Stock and will only have value if
the Company's stock price increases from the time of the
award. Vesting of options granted before February 1999
occurs only during employment with the Company or a
subsidiary upon each anniversary of the award, unless
vesting is subject to performance goals established by
the Committee in which case a pro rata portion of the
option could eventually vest. Vesting of options granted
since February 1999 continues after retirement for those
persons who do not thereafter compete with the Company
during the vesting period.

The number of stock options granted to the executive
officers named in the Summary Compensation Table is
currently determined by the Committee pursuant to a
formula without reference to the number of stock options
granted previously. Pursuant to the formula, the number
of option shares granted has corresponded to the number
of underlying Company shares that would produce a value
ranging from 49% to 113% of the participant's yearly
salary, calculated based on the Black-Scholes formula.
Stock options are currently granted to those executives
in February of each year. Since the formula is keyed to
salary, the performance factors discussed in the Base
Salary paragraph also would apply to this compensation
component. The Committee reserves the right to change or
eliminate the formula at any time.

Performance Share Units. The 1997 Stock Option Plan also
authorizes granting performance share units to employees
of the Company and its subsidiaries. Performance share
units entitle the grantee to receive shares of the
Company's Common Stock (or cash in lieu thereof) upon
the achievement of pre-established performance goals
related to comparative shareholder return.

Restricted Stock. The 1997 Stock Option Plan authorizes
granting shares of restricted stock to employees of the
Company and its subsidiaries.

Retirement. The Profit Sharing Retirement Plan covers
all regular employees of the Company and its
subsidiaries, including the executive officers named in
the Summary Compensation Table. The Board of Directors
determines annually an amount to be contributed by the
Company to the

14
18

Profit Sharing Retirement Plan. The Company's
contribution is allocated based on a participant's years
of service with the Company, with participants receiving
an allocation of 0% to 3% of compensation based upon the
Company's performance and years of service. For purposes
of these allocations, compensation is limited to
$170,000 for calendar years 2000 and 2001. Distributions
are made in accordance with the Plan's provisions at
normal retirement age, or earlier, at termination of
employment, death, disability or hardship.

The Supplemental Executive Retirement Plan provides
retirement benefits to certain senior executives of the
Company. This Plan is described in the note to the
Pension Plan Table on page 12.

Savings. Pursuant to the 401(k) Plan, employees may
elect to have the Company pay from 1% to 15% of the
employee's compensation, up to a maximum of $10,500 for
2000 and 2001, to the 401(k) Plan instead of paying that
amount to the employee. The Company matches 100% of the
employee's contribution up to 4% of the employee's
compensation. Monies in the account are invested at the
direction of the employee among one or more of 10 funds,
one of which consists of Common Stock of the Company, or
through a brokerage account maintained by the Plan's
Trustee. Distributions are made in accordance with the
Plan's provisions at normal retirement age, or earlier,
at termination of employment, death, disability or
hardship.

The Executive Deferred Compensation Plan provides a
select group of management and highly compensated
employees with the opportunity to elect to defer future
salary, bonuses and any earned performance share units
before these amounts are actually earned. Executives are
eligible to participate in the Plan if they earn an
annual base salary of at least $85,000. Deferrals are
not subject to income taxation until amounts are
actually received by the participants upon termination
of employment or retirement.

COMPENSATION OF THE PRESIDENT AND THE FORMER CHAIRMAN OF
THE BOARD OF DIRECTORS

The base salary for the President is, and for the former
Chairman of the Board of Directors was, determined by
the Committee based on overall Company performance. That
performance is measured by a number of factors including
the Company's earnings, real or perceived retail
environment and competitive conditions, performance
versus budget, growth in sales, improvement in gross
margins and the Committee's assessment of management
skills. None of these factors is necessarily given
greater weight than any other factor. The base salary of
the President was increased on September 1, 2000 from
$280,000 (as an Executive Vice President) to $600,000
(as President) to reflect the assumption of new
responsibilities. The base salary of the former Chairman
of the Board of Directors was $650,000 and was not
increased from 1999 to 2000 reflecting business results.

The annual bonus incentive for the President was
established after his assumption of new
responsibilities, and was based on earnings per share.
Those targets were not met and the President did not
receive any bonus during the fiscal year ended January
31, 2001. The annual bonus incentive for the former
Chairman of the Board of Directors was based on earnings
per share targets and comparable store sales. Those
targets were not met

15
19

and the former Chairman of the Board of Directors did
not receive any bonus during the fiscal year ended
January 31, 2001.

The President and the former Chairman of the Board of
Directors received stock options during the fiscal year
ended January 31, 2001 pursuant to the formula used for
all other executive officers named in the Summary
Compensation Table as previously described.

ADDITIONAL INFORMATION

The tables under "Compensation of Executive Officers in
the Year Ended January 31, 2001" may be found earlier in
this Proxy Statement and reflect the decisions covered
by the foregoing discussion.

Internal Revenue Code Section 162(m) disallows a tax
deduction to public corporations for compensation over
$1,000,000 paid to the executive officers named in the
Summary Compensation Table. The statute exempts
qualifying "performance-based compensation" from the
deduction limit if certain requirements are met. The
Committee currently intends to structure
performance-based compensation, including stock option
grants and annual bonuses to executive officers who may
be subject to Section 162(m), in a manner that satisfies
those requirements. The Committee reserves the authority
to award non-deductible compensation in circumstances
that are in the best interests of the Shareholders and
the Company.

February 21, 2001
COMPENSATION AND STOCK OPTION COMMITTEE
William D. Ruckelshaus, Chair
Enrique Hernandez, Jr.
Ann McLaughlin Korologos
Alfred E. Osborne, Jr.

AUDIT COMMITTEE
REPORT ON THE
FISCAL YEAR ENDED
JANUARY 31, 2001 The Audit Committee is governed by a written charter
adopted and approved by the Board of Directors, a copy
of which is attached as Appendix A to this Proxy
Statement. Each of the members of the Audit Committee
qualifies as an "independent" director under the
applicable listing standards of the New York Stock
Exchange.

Management is responsible for the Company's internal
controls and the financial reporting process. The
Company's independent auditors, Deloitte & Touche LLP,
are responsible for performing an independent audit of
the Company's consolidated financial statements in
accordance with auditing standards generally accepted in
the United States of America and to issue a report
thereon. The independent auditors and the Company's
internal auditors have full access to the Audit
Committee and meet with the Audit Committee, with, and
on a routine basis, without, management being present,
to discuss appropriate matters.

Based on the Audit Committee's review of the audited
consolidated financial statements, its discussion with
management regarding the audited consolidated financial
statements, its receipt of written disclosures and the
letter from the independent auditors required by
Independence Standards Board Standard No. 1, its
discussions with the independent auditors regarding such
auditors' independence, the audited consolidated
financial statements, the matters required to be
discussed by the Statement on Auditing Standards 61, as
amended, and other matters, the Audit Committee
recommended to the Board of Directors that the audited
consolidated financial statements for the fiscal year
ended January 31,

16
20

2001 be included in the Company's Annual Report on Form
10-K for such fiscal year.

February 21, 2001
AUDIT COMMITTEE

Ann McLaughlin Korologos, Chair
Enrique Hernandez, Jr.
Alfred E. Osborne, Jr.
William D. Ruckelshaus
Bruce G. Willison

PROPOSAL 2:
RATIFICATION OF
APPOINTMENT OF
AUDITORS The Board of Directors, acting upon the recommendation
of the Audit Committee, has appointed the independent
public accounting firm of Deloitte & Touche LLP to be
the Company's auditors for the fiscal year ending
January 31, 2002. As in the past, the Board has
determined that it would be desirable to request
ratification of its appointment by the Shareholders of
the Company. If the Shareholders do not ratify the
appointment of Deloitte & Touche LLP, the appointment of
independent public accountants will be reconsidered by
the Board. A representative of Deloitte & Touche LLP
will be present at the Annual Meeting, will have the
opportunity to make a statement if he or she so desires,
and will be available to respond to appropriate
questions.

AUDIT FEES. The aggregate fees billed for professional
audit services rendered by Deloitte & Touche LLP for
services performed related to the fiscal year ended
January 31, 2001 were $578,775. Such fees include
attestation services performed for the consolidated
financial statements of the Company and the separate
financial statements of Nordstrom Credit, Inc.,
NORDSTROM.com, LLC and Faconnable SAS, and reviews of
the interim financial information of the Company and
Nordstrom Credit, Inc. and their respective Forms 10-K
and 10-Q.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION
FEES. Deloitte & Touche LLP did not provide the Company
any financial information systems design and
implementation services for the fiscal year ended
January 31, 2001.

ALL OTHER FEES. The aggregate fees billed for services
rendered by Deloitte & Touche LLP, other than for audit
services and financial information systems design and
implementation services, for the fiscal year ended
January 31, 2001 were $1,607,430. The Audit Committee
has considered whether the provision of these services
is compatible with maintaining the independence of
Deloitte & Touche LLP.

The Board of Directors recommends a vote FOR
ratification of Deloitte & Touche LLP as auditors for
the Company.

17
21

STOCK PRICE PERFORMANCE PERFORMANCE GRAPH

The following graph compares for each of the last five
fiscal years, ending January 31, 2001, the cumulative
total return of Company Common Stock, Standard & Poor's
500 Composite Index, and Standard & Poor's Retail Store
Composite. The cumulative total return of Company Common
Stock assumes $100 invested on January 31, 1996 in
Nordstrom, Inc. Common Stock and assumes reinvestment of
[PERFORMANCE GRAPH] dividends.

S&P RETAIL COMPOSITE S&P 500 COMPOSITE
NORDSTROM, INC. INDEX INDEX
--------------- -------------------- -----------------

1996 100 100 100
1997 96 118 124
1998 133 173 154
1999 219 281 201
2000 117 280 219
2001 111 298 215

COMPENSATION OF
DIRECTORS Employee directors of the Company are not paid any fees
for serving as members of the Board of Directors or any
Board committee. Non-employee directors are paid a
yearly retainer of $29,000, a fee of $1,000 for each
Board of Directors meeting attended, a fee of $1,000 for
each Board committee meeting attended, and are
reimbursed for reasonable traveling expenses.

Pursuant to the 1993 Non-Employee Director Stock
Incentive Plan, immediately following each Annual
Meeting of Shareholders, non-employee directors also
receive that number of shares of Company Common Stock
having a fair market value of $10,000, plus a $4,000
cash award to offset tax obligations attributable to the
stock award.

Additionally, as compensation for his services as lead
outside director, Enrique Hernandez, Jr. was granted
25,000 Nordstrom stock units on November 21, 2000 under
the Director's Deferred Compensation Plan. The value of
these units on the date of the grant was $200,781
calculated using the Black-Scholes formula. Mr.
Hernandez also may use a Company airplane up to four
times a year for domestic travel, and was awarded an
extra payment of $1,000 for his participation in the
August 2000 management restructuring.

John A. McMillan, Bruce A. Nordstrom and John N.
Nordstrom also each received a fee of $50,000 during the
fiscal year ended January 31, 2001 for consulting
services rendered.

18
22

CERTAIN RELATIONSHIPS
AND RELATED
TRANSACTIONS During the fiscal year ended January 31, 2001, the
Company leased an airplane from JBW Aircraft Leasing
Company, Inc. ("JBW"), of which John N. Nordstrom, Bruce
A. Nordstrom and D. Wayne Gittinger are the sole
shareholders. During that year, the Company made lease
payments to JBW of $78,870. Also during that year, JBW
made payments to the Company of $93,880 for hangar rent
and maintenance services.

During the fiscal year ended January 31, 2001, the net
amount of payments made to the Company by JW Limited, of
which John N. Nordstrom and D. Wayne Gittinger are the
sole shareholders, was $40,945 for hangar rent and
maintenance services.

On June 15, 1999, Llynn (Len) A. Kuntz, an Executive
Vice President of the Company, executed a promissory
note in favor of the Company evidencing a loan in the
original amount of $150,000 (with interest at the rate
of 7.75%) to facilitate his purchase of a home. The
maximum amount of indebtedness during the fiscal year
ended January 31, 2001, was $162,026.

On June 15, 1999, Geevy S.K. Thomas, an Executive Vice
President of the Company, executed a promissory note in
favor of the Company evidencing a loan in the original
amount of $150,000 (with interest at the rate of 7.75%)
to facilitate his purchase of a home. The maximum amount
of indebtedness during the fiscal year ended January 31,
2001, was $162,026.

D. Wayne Gittinger's stepson was employed by the Company
during part of the fiscal year ended January 31, 2001,
at a total compensation of $126,967, which included
$54,403 in salary and $72,564 in severance pay.

Bruce A. Nordstrom's son, Erik B. Nordstrom, an
Executive Vice President of the Company, was employed by
the Company during the fiscal year ended January 31,
2001, at a total compensation of $339,936.

John N. Nordstrom's son was employed by the Company
during part of the fiscal year ended January 31, 2001,
at a total compensation of $71,582.

The spouse of James R. O'Neal, an Executive Vice
President of the Company, was employed by the Company
during the fiscal year ended January 31, 2001, at a
total compensation of $203,260.

The spouse of Llynn (Len) A. Kuntz, an Executive Vice
President of the Company, was employed by the Company
during the fiscal year ended January 31, 2001, at a
total compensation of $268,507.

PROPOSAL 3: SHAREHOLDER
PROPOSAL REGARDING
EXECUTIVE COMPENSATION Carpenters Combined Benefits Funds of Massachusetts, 350
Fordham Road, Suite 4, Wilmington, Massachusetts, has
notified the Company that it intends to present the
following Proposal at the Annual Meeting:

"RESOLVED, that the shareholders of Nordstrom, Inc. (the
"Company") hereby request that the Company's Board of
Directors take the necessary steps to establish a
performance-based senior executive compensation system
that focuses the five most highly-paid members of
management on advancing the long-term success of the
Company. To demonstrate that such steps have been taken,
we request that the Compensation Committee Report
included in the company's annual report to shareholders
identify specific performance criteria and explain why
they have been selected; the specific target level that
must be achieved to satisfy that performance

19
23

criteria; and rank each performance factor in order of
importance, as well as identify the weight attached to
each factor.

SUPPORTING STATEMENT

The long-term success of the Company depends on the
ability of the board of directors and senior management
to establish and implement a strategic plan that ensures
the Company's long-term success. This strategic plan
must meet the needs of the Company's customers,
recognize the important contributions of its employees,
accept the Company's responsibility to associate itself
with responsible vendors and suppliers, and satisfy all
legal and ethical responsibilities to the Company's
immediate and broader community.

Senior management must be keenly focused on fulfilling
these strategic plans. The best way to ensure proper
focus is through a performance-based executive
compensation system that generously rewards superior
performance. Specific financial and non-financial
performance criteria should be selected to focus the
five most highly-paid members of management on advancing
the long-term success of the Company.

This system must be transparent, justifiable and
challenging to focus senior management and the rest of
the Company. Accountability must be the cornerstone of
the system. Such a system would serve to motivate senior
management and all other employees throughout the ranks.

Too often, though, as is the case at our Company, the
executive compensation system rewards average or below
average performance and does not motivate senior
management to excel. Rather than challenging them to
achieve superior performance, enormous compensation
packages, including massive stock option grants,
effectuate significant and unjustifiable transfer of
wealth from shareholders to managers. Such a system is
not in shareholders' interest.

Consider our Company. Its stock performance over the
past five year period has significantly lagged the S&P
Retail Composite Index and S&P 500 Index. An investment
of $100 in the Company, the S&P Retail Index, and the
S&P 500 Index on January 31, 1995, was worth $115, $298,
and $296, respectively, five years later. Despite this
weak performance, senior management has received very
large compensation packages during this period.

The current Compensation Committee report does not
adequately detail how the Company's executive
compensation system focuses senior management on
achieving long-term success.

Adoption of this proposal would advance a senior
management compensation system that promotes
accountability, ensures management is rewarded for
excellent performance, not average results, and focuses
management and all employees on achieving long-term
success.

We urge you to vote for this proposal."

THE COMPANY'S STATEMENT IN OPPOSITION

The Company has adopted an executive compensation
program (the "Program") consisting of three components,
each of which furthers a differing objective, but all of
which together are intended to serve the Company's
value-based management approach by more closely aligning

20
24

the Company's compensation program with increasing value
for shareholders. Pursuant to the Program, compensation
is composed of base salary, annual bonus incentives, and
long-term incentives, the formulation of each of which
is described in some detail in the report of the
Compensation and Stock Option Committee above.

Under the Program, adjustments to base salary, if any,
are made annually, based on the Committee's view of how
the management team and the respective individual
contribute to the overall performance of the Company.
Overall performance of the Company is measured by a
number of factors including performance versus budget,
improvement in gross margins, and the Committee's
assessment of management skills. All of these factors
are equally weighted. Finally, for comparison purposes,
the Committee also reviews the median base salaries for
competitors in the specialty retailing field.

Annual bonus incentives are intended to focus Company
management on achieving specifically targeted
performance goals. Such goals may include earnings,
earnings per share, division sales, inventory turns and
gross margins. The amount of bonus incentive
compensation awarded is based upon the Committee's
assessment of the successful attainment of these
pre-established performance goals, and is calculated as
a function of the respective executive's base salary.

Long-term incentives are administered pursuant to
shareholder-approved stock plans and allow the award of
compensation in the form of stock options, performance
share units, and restricted stock. Stock options may
only be awarded at fair market value. Accordingly, such
awards have value only to the extent that the stock
price increases. Performance share units entitle the
employee to receive shares of Nordstrom stock (or cash,
at the employee's discretion) upon the achievement of
certain pre-established performance goals enumerated in
the Company's shareholder-approved 1997 Stock Option
Plan. All performance share units granted to date
entitle the employee to receive stock or cash only,
based on the achievement of pre-established performance
goals related to the performance of Nordstrom stock
compared to the performance of eleven similarly situated
companies which the Company considers to be its
principal competitors. Restricted stock is granted in
very limited circumstances, and only one award of
restricted stock is currently outstanding.

Since the Company already has in place a compensation
structure that is performance-based in nature and
structured around objective performance criteria, the
Company believes that no alteration to the existing
compensation structure is warranted. Additionally, the
Committee's report contained in the Company's proxy
statement already describes this performance-based
compensation system as required by the Securities and
Exchange Commission's disclosure rules. Under those
rules, the Committee's report is required to address
factors and criteria upon which executive officers'
compensation is based. Those same guidelines, however,
specifically state that the Company is not required to
disclose specific target levels in the context of
quantitative or qualitative performance-related factors
and, for competitive reasons, the Company has chosen not
to disclose such target levels.

Accordingly, the Board of Directors of the Company
recommends that you vote AGAINST this Proposal.

21
25

PROPOSAL 4:
SHAREHOLDER PROPOSAL
REGARDING VENDOR
STANDARDS Domini Social Investments, 536 Broadway, 7th Floor, New
York, New York 10012 and Walden Asset Management, 40
Court Street, Boston, Massachusetts 02108, have notified
the Company that they intend to present the following
Proposal at the Annual Meeting:

"WHEREAS: Consumers and shareholders continue to be
seriously concerned about whether low wages and abusive
working conditions exist in facilities where the
products they buy are produced or assembled.

U.S.-based companies are importing more goods from
countries where working conditions fall far below basic
standards of fair and humane treatment. Our company
purchases goods produced in countries like China where
human rights abuses and unfair labor practices have been
well documented. (U.S. State Department's "China Country
Report on Human Rights Practices -- 1998")

A growing number of students have called on their
universities to adopt codes of conduct to make sure
clothing sold in university stores is made under humane
conditions. Students have pressed for a living wage,
upholding the rights of women in the workplace, public
disclosure of conditions in factories and transparency
in reporting, and verification of compliance by
organizations that are independent of companies.
("Sweatshop Reform," Business Week, 5/3/99)

Our company should take effective action to ensure it
does not and will not do business with suppliers who
manufacture items for sale using forced labor, convict
labor, or illegal child labor, or who fail to satisfy
all applicable standards and laws protecting their
employees' wages, benefits, working conditions, freedom
of association and other rights.

Reports that overseas suppliers are exploiting workers
may damage our company's reputation and generate a
consumer backlash. We believe our company needs to
support the right of workers to organize and bargain
collectively any place they operate. Our company should
demonstrate enforcement of its code by developing
independent monitoring programs with local, respected
religious, human rights or labor rights groups to ensure
compliance with its vendor standards and assure
consumers that products are not made under abusive labor
conditions.

In an effort to improve the quality of life of workers
who make its products, our company should investigate
implementing ongoing wage adjustments, ensuring that
workers have adequate purchasing power and a sustainable
living wage. Wage adjustments would add little to
overall production costs while contributing to
productivity. In addition, our company, rather than
terminating contracts, needs to establish incentives to
encourage its suppliers and vendors to raise labor
standards.

Resolved: Shareholders request the Board of Directors to
prepare at reasonable expense a report on Vendor
Standards compliance mechanisms and progress in
achieving compliance for its vendors, subcontractors and
buying agents in the countries where it sources. A
summary of the results should be reported to
shareholders by October 2001.

SUPPORTING STATEMENT

To be effective, enforcement of company codes must be
carefully monitored. The Gap, Inc. has participated in
an independent monitoring process in El Salvador with
respected religious and human rights and labor rights

22
26

institutions for the past four years. Other companies
have begun to develop independent monitoring programs in
conjunction with local non-government organizations.
Through the use of independent monitoring, consumers and
investors can have greater confidence that the company's
code of vendor conduct is enforced, protecting the
company from negative publicity associated with the
discovery of sweatshop practices."

THE COMPANY'S STATEMENT IN OPPOSITION

The Company has adopted a multi-step approach with the
goal of ensuring that the facilities operated by its
vendors, subcontractors, and buying agents adhere to a
high degree of ethical labor standards, provide a safe
and healthy working environment, do not engage in
discriminatory practices or violate basic human rights,
and comply with all applicable employment laws with
respect to wages and overtime. Since 1994, the Company
has attempted to distribute the Nordstrom Partnership:
Standards and Business Practice Guidelines (the
"Guidelines") to all existing and new vendors. The
Guidelines apply to both domestic and overseas vendors.
The code of conduct has been translated into several
foreign languages for posting at the various facilities
operated by Nordstrom's contractors.

The Guidelines, which are derived from the International
Labour Organization standards, state that Nordstrom
expects its vendors to comply with all applicable wage,
hour and overtime laws, follow fair employment
practices, comply with environmental standards, and
provide a safe work environment. The Guidelines also
specifically forbid the use of child, prison, or other
forced labor. Nordstrom routinely reviews the Guidelines
to determine whether modifications are appropriate in
light of new developments.

In order to ensure compliance with the Guidelines and
applicable laws by vendors who manufacture private label
goods for Nordstrom: (i) vendors, subcontractors, and
buying agents must confirm in writing that they will
comply with the Guidelines prior to the initial
placement of production; (ii) Nordstrom representatives
review the Company's code of conduct and quality
standards in person with manufacturers; and (iii)
Nordstrom personnel and/or third parties conduct random
announced and unannounced on-site inspections where they
audit compliance with the Guidelines, including working
environment, age of employees, and compliance with
applicable laws. Nordstrom's corrections program for
suppliers found to be in violation of the Guidelines
varies depending upon the severity of the violation. The
Company's first and foremost priority is to educate its
suppliers on the importance of the Company's Partnership
Guidelines and guide them into full compliance. In the
event of a major violation such as forced labor, etc.
Nordstrom may choose to cancel outstanding orders,
terminate the contract, and/or pursue legal action.

As with any other matter which might be of interest to
Shareholders, the Company is always ready and willing to
discuss Nordstrom's approach to the matters raised in
this shareholder proposal with any interested
Shareholder and to provide interested Shareholders with
non-confidential information maintained by the Company.
More specifically, Nordstrom reasonably responds to
inquiries from customers, Shareholders, and other
concerned citizens regarding the matters raised in the
Proposal.

Nordstrom also has issued press releases regarding the
Guidelines, vendor standards, and compliance efforts
providing information on who to contact with further
questions. Nordstrom will continue to make information
con-

23
27

cerning its policies, procedures, and practices directly
available to its Shareholders.

In that regard, to make Nordstrom's policy regarding the
matters underlying this Shareholder Proposal even more
clear to Shareholders, Nordstrom has included a
disclosure in its Annual Report disseminated to all
Shareholders with its 2001 Proxy Materials assuring
Shareholders that Nordstrom is always ready and willing
to discuss matters of concern to Shareholders, including
its vendor standards compliance mechanisms and progress
in achieving compliance.

Since Nordstrom has made and will continue to make
information regarding its vendor standards compliance
mechanisms and progress in achieving compliance
reasonably available to inquiring Shareholders, the
Company believes that no such report is necessary.

Accordingly, the Board of Directors of the Company
recommends that you vote AGAINST this Proposal.

PROPOSAL 5: SHAREHOLDER
PROPOSAL REGARDING
HUMAN RIGHTS The New York City Police Pension Fund, through the
Comptroller of the City of New York, 1 Centre Street,
New York, New York 10007, has notified the Company that
it intends to present the following Proposal at the
Annual Meeting:

"Whereas, Nordstrom, Inc. currently has extensive
overseas operations, and

Whereas, reports of human rights abuses in the overseas
subsidiaries and suppliers of some U.S.-based
corporations has led to an increased public awareness of
the problems of child labor, "sweatshop" conditions, and
the denial of labor rights in U.S. corporate overseas
operations, and

Whereas, corporate violations of human rights in these
overseas operations can lead to negative publicity,
public protests, and a loss of consumer confidence which
can have a negative impact on shareholder value, and

Whereas, a number of corporations have implemented
independent monitoring pilot programs with respected
local human rights and religious organizations to
strengthen compliance with international human rights
norms in selected supplier factories, and

Whereas, the Council on Economic Priorities has
established a program of independent monitoring known as
the SA8000 Social Accountability Standards, and

Whereas, these standards incorporate the conventions of
the International Labor Organization (ILO) on workplace
human rights which include the following principles:

(1) All workers have the right to form and join
trade unions and to bargain collectively. (ILO
Conventions 87 and 98)

(2) Workers representatives shall not be the
subject of discrimination and shall have access
to all workplaces necessary to enable them to
carry out their representation functions. (ILO
Convention 135)

(3) There shall be no discrimination or
intimidation in employment. Equality of
opportunity and treatment shall be provided
regardless of race, color, sex, religion,
political opinion, age, nationality,

24
28

social origin, or other distinguishing
characteristics. (ILO Convention 100 and 111)

(4) Employment shall be freely chosen. There shall
be no use of force, including bonded or prison
labor. (ILO Conventions 29 and 105)

(5) There shall be no use of child labor. (ILO
Convention 138), and,

Whereas, independent monitoring of corporate adherence
to these standards is essential if consumer and investor
confidence in our company's commitment to human rights
is to be maintained,

Therefore, be it resolved that the company commit itself
to the full implementation of the aforementioned human
rights standards by its international suppliers and in
its own international production facilities and commit
to a program of outside, independent monitoring of
compliance with these standards."

THE COMPANY'S STATEMENT IN OPPOSITION

The Guidelines which are derived from the International
Labour Organization standards state that Nordstrom
expects its vendors to comply with all applicable wage,
hour and overtime laws, follow fair employment
practices, comply with environmental standards, and
provide a safe work environment. The Guidelines also
specifically forbid the use of child, prison, or other
forced labor. Nordstrom routinely reviews the Guidelines
to determine whether modifications are appropriate in
light of new developments.

25
29

The Company believes that the provisions of its
Guidelines, implemented through the above multi-step
approach to ensure compliance, substantially comply with
the spirit of SA8000, the underlying conventions of the
International Labour Organization and independent
monitoring program that are the subject of the
proponent's proposal. In that regard, Nordstrom is
currently in the process of again studying the
provisions of SA8000 as well as the Code of Conduct of
the Fair Labor Association.

Accordingly, the Board of Directors of the Company urges
you to vote AGAINST this proposal.

COMPLIANCE WITH
SECTION 16 OF THE
EXCHANGE ACT OF 1934 Based solely on its review of copies of reports made
pursuant to Section 16(a) of the Securities Exchange Act
of 1934, the Company believes that during the fiscal
year ended January 31, 2001, all filing requirements
applicable to its directors, executive officers, and 10
percent shareholders were satisfied, except that Dale
Cameron (Crichton) filed one report late.

OTHER MATTERS The Board of Directors of the Company knows of no other
matters that may come before the meeting. However, if
any other matters should properly come before the
meeting or any adjournment thereof, it is the intention
of the persons named in the Proxy to vote the Proxy in
accordance with their best judgment.

SHAREHOLDER PROPOSALS
FOR 2002 ANNUAL
MEETING Proposals for Shareholder action that eligible
Shareholders wish to have included in the Company's
Proxy Statement mailed to Shareholders in connection
with the Company's 2002 Annual Meeting must be received
by the Company at its principal executive offices at
1617 Sixth Avenue, Seattle, Washington, 98101-1742, on
or before December 12, 2001.

By order of the Board of Directors,
/s/ N. CLAIRE CHAPMAN

N. Claire Chapman
Secretary
Seattle, Washington
April 11, 2001

26
30

APPENDIX A
NORDSTROM, INC.
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
CHARTER

PURPOSE AND SCOPE

The primary function of the Audit Committee of the Board of Directors (the
"Committee") is to assist the Board in fulfilling its oversight responsibilities
with respect to:

1. Accounting and financial reporting,

2. Assessment and management of risk and the internal controls environment,
and

3. Compliance with laws and regulations.

AUTHORITY

In fulfilling its responsibilities, the Committee may:

1. Conduct or authorize investigations into any relevant matters,

2. Access Company records and information, and

3. Retain counsel, accountants, or others as needed.

COMMITTEE COMPOSITION, MEETINGS AND ADMINISTRATIVE MATTERS

1. Member Requirements. Audit Committee members shall meet the requirements of
the New York Stock Exchange (NYSE) as follows:

- Number of Directors. The Committee shall consist of at least three
directors.

- Independent Directors Only. As defined by the NYSE.

- Finance/Accounting Qualifications. All Committee members shall be
generally knowledgeable in financial and auditing matters, including at
least one member with accounting or related financial management
expertise.

2. Committee Appointment. The Committee and its Chairperson shall be appointed
annually by the Board of Directors and members' independence shall be
confirmed by the Board during the appointment process.

3. Meeting Frequency. The Committee shall meet at least four times per year, or
more often as deemed necessary by the Chairperson.

4. Meeting Attendees. In addition to the Committee members, the Committee may
ask that members of management, Internal Audit, the Company's independent
auditors, or others be present at Committee meetings.

5. Minutes. Minutes of each meeting shall be prepared by the designee of the
Chairperson of the Committee. Draft minutes shall be distributed to
Committee members, as soon as practicable after

27
31

each meeting, for approval at the next meeting of the Committee. The
approved minutes shall be provided to the Secretary of the Company for
retention with the permanent records of the Company.

6. Private Communications. At the Committee meetings, there will be an
opportunity for Committee members to have private communication with
management, the internal auditors and the independent auditors.

7. Reporting to the Board. The Chairperson or his or her designee will report
Committee actions to the Board of Directors with such recommendations as the
Committee may deem appropriate.

8. Audit Committee Charter Update and Disclosure. The Committee shall, at least
annually, review its Charter and, if appropriate, propose revisions to the
full Board of Directors for approval.

- Proxy Statement Disclosure -- The Charter shall be published in the
Company's proxy statement at least once every three years in accordance
with Securities and Exchange Commission regulations.

9. Annual NYSE Certification Letter. As required by the NYSE, the Committee
shall annually submit a certification letter to the NYSE confirming members
meet financial qualifications, the Board confirmed members' independence,
and the Committee reevaluated its Charter within the last year.

10. Independent Auditor Appointment. The independent auditor is ultimately
accountable to the Board of Directors and the Audit Committee, as
representatives of the shareholders. The Committee shall have the authority
to evaluate and, where appropriate, recommend replacement of the independent
auditor. Annually, the Committee shall recommend to the Board the
appointment of a firm of Certified Public Accountants to serve as the
Company's independent auditors. The appointment by the Board shall be
subject to shareholder ratification.

11. Independent Auditor Independence. The Committee shall require from the
independent auditor a formal written statement delineating all relationships
between the auditor and the Company, consistent with Independence Standards
Board Standard 1. The Committee shall discuss with the independent auditor
any disclosed relationships or services that may impact the objectivity and
independence of the auditor and shall take appropriate action to reasonably
assure the independence of the auditor.

12. Internal Audit Director Appointment. The Committee shall review and approve
the appointment, replacement or dismissal of the Director of Internal Audit.

CORPORATE ACCOUNTING AND FINANCIAL REPORTING

1. Accounting Principles and Financial Reporting Policies. The Committee will
review with financial management and approve the Company's significant
accounting and reporting policies and any changes thereto. The Committee
will periodically discuss with the independent auditor their judgments about
the quality of the Company's accounting principles as applied in its
financial reporting, including such matters as the clarity of disclosures,
the degree of aggressiveness or conservatism of the Company's accounting
principles and other significant matters of judgment.

2. Financial Controls. The Committee will review financial controls with
management and assess the internal processes for determining and managing
key risk areas to safeguard assets and provide appropriate assurance of
accurate financial reporting.

28
32

3. Quarterly Financial Statements and Independent Auditor's Review. The
Committee will review with financial management and the independent auditors
the Company's quarterly financial statements prior to the filing of Form
10-Q. The Committee will discuss any significant changes to the Company's
accounting principles and any items required to be communicated by the
independent auditors in accordance with the American Institute of Certified
Public Accountants, Statement on Auditing Standards Number 61 (AICPA SAS
61).

4. Annual Financial Statements and Independent Auditor's Audit Results. Prior
to filing form 10K, the Committee will discuss the annual financial report
and audit results with financial management and the independent auditors.
The Committee will discuss with the independent auditors those matters
required to be communicated to audit committees in accordance with AICPA SAS
61.

- Annual Financial Statement Recommendation to the Board. Based on its
review, the Committee will recommend to the Board the inclusion of the
Company's audited financial statements in the annual report on Form 10-K.

5. Proxy Disclosure -- Annual Audit Committee Report to Shareholders. The
Committee will annually prepare a report for inclusion in the proxy
statement.

RISK ASSESSMENT, INTERNAL CONTROLS AND LEGAL MATTERS

1. Independent Auditor's Plan and Fees. The Committee will review with the
independent auditors their risk assessment, scope and approach, and related
fees, for the annual examination. The Committee will also review the nature
of and fees for all other professional services provided to the Company by
the independent auditor or its affiliates.

2. Internal Audit. The Committee will review, with internal audit, the process
used to assess risks, and develop appropriate annual plans. The Committee
will consider and review any difficulties encountered in the course of
internal audit work. The Committee will review any significant changes to
the internal audit plan.

3. Significant Control Weaknesses. The Committee will consider and review with
the independent auditors, internal audit and management, any significant
control weaknesses, including management's timetable and corrective action
plans.

4. Legal Matters. The Committee will review with management and counsel, any
legal matters that could have a material impact on the Company's financial
statements and the Company's compliance with applicable laws and
regulations, including reports received from regulators or governmental
agencies.

29
33

NORDSTROM LOGO

Printed on 25% Recycled Fiber
34

PROXY

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

NORDSTROM, INC.
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101-1742

By signing this Proxy, the Shareholder appoints D. Wayne Gittinger and
N. Claire Chapman, or either of them, with full power of substitution, proxies
to vote all shares of stock of the undersigned entitled to vote at the Annual
Meeting of Shareholders of Nordstrom, Inc. to be held May 15, 2001, at 11:00
a.m., Pacific Daylight Time, at the John W. Nordstrom Room, Downtown Seattle
Nordstrom, 1617 Sixth Avenue, 5th Floor, Seattle, Washington, 98101-1742, and
any adjournment thereof, with all power the Shareholder would possess if
personally present.

This Proxy will be voted in accordance with the instructions given.
Unless revoked or otherwise instructed, the shares represented by this Proxy
will be voted for proposals 1 and 2, and, if they are presented, against
proposals 3, 4, and 5, and will be voted in accordance with the discretion of
the proxies upon all other matters that may come before the meeting or any
adjournment thereof.

Please mark, date, sign, and return this proxy card promptly using the
enclosed postage-paid envelope.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

DEAR NORDSTROM PROFIT SHARING AND 401(k) PLAN PARTICIPANT:

Since you have a portion of your Nordstrom Profit Sharing and 401(k)
Plan account invested in the Nordstrum Stock Fund, you have the right
to vote the shares on Nordstrom stock held for your account. This same
proxy and voting information is furnished to all Nordstrom
Shareholders.

The Trustee of the Nordstrom Profit Sharing and 401(k) Retirement Trust
is Putnam Fiduciary Trust Company, which holds the stock on your
behalf, will receive your signed proxy and instructions, as well as
those made by other participants, and cast the resulting vote on behalf
of the Fund. YOUR VOTE WILL BE KEPT IN STRICT CONFIDENCE BY THE
TRUSTEE.

YOUR VOTE IS IMPORTANT. Please return only this proxy card in the
enclosed envelope. PLEASE DO NOT COMBINE THIS PROXY WITH ANY OTHER
PROXY CARDS YOU MAY RECEIVE AS THEY MAY BE TABULATED BY A DIFFERENT
SYSTEM. You must execute and return this proxy card if you wish to vote
these shares. If you do not vote the shares held in your Plan account,
then they will be voted by Wells Fargo Bank, N.A., in its discretion,
as independent fiduciary.

NORDSTROM

Please mark
your votes as [X]
indicated in
this example

Management Recommends a vote FOR FOR all nominees WITHHOLD
all nominees. (except as indicated to AUTHORITY to vote
the contrary below) for all nominees
PROPOSAL 1 - ELECTION OF DIRECTORS [ ] [ ]

D. W. Gittinger; E. Hernandez, Jr.; J. A. McMillan;
B. A. Nordstrom; J. N. Nordstrom; A. E. Osborne, Jr.;
W. D. Ruckelshaus; B. G. Willison; A. A. Winter

To withhold authority to vote for any individual nominee, write that nominee's
name on the space provided below.

______________________________________

FOR AGAINST ABSTAIN
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS [ ] [ ] [ ]

Management Recommends a vote FOR Proposal 2. [ ] [ ] [ ]

PROPOSAL 3 - SHAREHOLDER PROPOSAL REGARDING PERFORMANCE-BASED EXECUTIVE
COMPENSATION Management Recommends a vote AGAINST Proposal 3. [ ] [ ] [ ]

PROPOSAL 4 - SHAREHOLDER PROPOSAL REGARDING VENDOR STANDARDS COMPLIANCE
MECHANISMS Management Recommends a vote AGAINST Proposal 4. [ ] [ ] [ ]

PROPOSAL 5 - SHAREHOLDER PROPOSAL REGARDING GLOBAL HUMAN RIGHTS STANDARDS
Management Recommends a vote AGAINST Proposal 5. [ ] [ ] [ ]

IN THEIR DISCRETION, THE PROXIES ARE
AUTHORIZED TO VOTE UPON SUCH OTHER MATTERS
AS MAY PROPERLY COME BEFORE THE MEETING. The
Board of Directors at present knows of no
other matters to be brought before the
meeting.

Signature(s)__________________________________________ Dated _____________, 2001

PLEASE SIGN AS YOUR NAME APPEARS ON THIS PROXY. Joint signers should each
sign. Trustees, Guardians, Personal and other Representatives, please indicate
your full title.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

NORDSTROM.COM - THERE'S ALWAYS A STORE NEAR YOU.

At Nordstrom, we want to ensure that customers find shopping with us as
convenient and rewarding as possible. This is the very reason we
launched NORDSTROM.com. With NORDSTROM.com, there is always a store
near you. In addition to our 121 stores across the nation, you can shop
online at www.nordstrom.com or through our catalogs to find the look
that's just right for you. Let us keep you posted on all promotions,
events and sales - log on and register at www.nordstrom.com or call
1-888-282-6060 to receive our catalogs.

At NORDSTROM.com, you can purchase great merchandise, learn about our
Company history, and review important shareholder information such as
news releases, daily stock quotes, annual reports - even web casts of
our quarterly conference calls discussing the latest financial results
- all from the comfort of your home or office. Of course we value and
welcome your feedback. If you have any comments regarding our web site
or catalogs, please email us at contact@nordstrom.com or call us at
1-888-282-6060.

NORDSTROM
36

PROXY

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

NORDSTROM, INC.
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101-1742

Please mark, date, sign, and return this proxy card promptly using the
enclosed postage-paid envelope.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

DIRECT DEPOSIT OF DIVIDEND

Nordstrom is pleased to offer its shareholders of record the ability to
have quarterly dividends electronically deposited. This service is
provided at no cost to you and enables you to have your dividends
deposited in an account at the financial institution of your choice.

The advantages of having your dividend payment electronically deposited
include: the availability of funds, the elimination of a trip to the
bank, and no possibility of a stolen or lost check.

If you wish to take advantage of this service, then please contact
Mellon Investor Services LLC at www.mellon - investor.com or call them
at 1-800-318-7045.

NORDSTROM

Please mark
your votes as [X]
indicated in
this example

Management Recommends a vote FOR FOR all nominees WITHHOLD
all nominees. (except as indicated to AUTHORITY to vote
the contrary below) for all nominees
PROPOSAL 1 - ELECTION OF DIRECTORS [ ] [ ]

D. W. Gittinger; E. Hernandez, Jr.; J. A. McMillan;
B. A. Nordstrom; J. N. Nordstrom; A. E. Osborne, Jr.;
W. D. Ruckelshaus; B. G. Willison; A. A. Winter

To withhold authority to vote for any individual nominee, write that nominee's
name on the space provided below.

FOR AGAINST ABSTAIN
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS
Management Recommends a vote FOR Proposal 2. [ ] [ ] [ ]

PROPOSAL 3 - SHAREHOLDER PROPOSAL REGARDING PERFORMANCE - BASED EXECUTIVE
COMPENSATION Management Recommends a vote AGAINST Proposal 3. [ ] [ ] [ ]

PROPOSAL 4 - SHAREHOLDER PROPOSAL REGARDING VENDOR STANDARDS COMPLIANCE
MECHANISMS Management Recommends a vote AGAINST Proposal 4. [ ] [ ] [ ]

PROPOSAL 5 - SHAREHOLDER PROPOSAL REGARDING GLOBAL HUMAN RIGHTS STANDARDS
Management Recommends a vote AGAINST Proposal 5. [ ] [ ] [ ]

Signature(s)_______________________________________________ Dated _________,2001
PLEASE SIGN AS YOUR NAME APPEARS ON THIS PROXY. Joint signers should each
sign. Trustees, Guardians, Personal and other Representatives, please indicate
your full title.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

NORDSTROM.COM - THERE'S ALWAYS A STORE NEAR YOU.

NORDSTROM

PROXY

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

NORDSTROM, INC.
1617 SIXTH AVENUE, SEATTLE, WASHINGTON 98101-1742

Please mark, date, sign, and return this proxy card promptly using the
enclosed postage-paid envelope.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

DEAR NORDSTROM.com 401(k) PLAN PARTICIPANT:

Since you have a portion of your NORDSTROM.com 401(k) Plan account
invested in the Nordstrum Stock Fund, you have the right to vote the
shares on Nordstrom stock held for your account. This same proxy and
voting information is furnished to all Nordstrom Shareholders.

The Trustee of the NORDSTROM.com 401(k) Plan Trust is Putnam Fiduciary
Trust Company, which holds the stock on your behalf, will receive your
signed proxy and instructions, as well as those made by other
participants, and cast the resulting vote on behalf of the Fund. YOUR
VOTE WILL BE KEPT IN STRICT CONFIDENCE BY THE TRUSTEE.

YOUR VOTE IS IMPORTANT. Please return only this proxy card in the
enclosed envelope. Please do not combine this proxy with any other
proxy cards you may receive as they may be tabulated by a different
system. You must execute and return this proxy card if you wish to vote
these shares. If you do not vote the shares held in your Plan account,
then they will be voted as determined appropriate by the Nordstrom.com
Retirement Committee.

NORDSTROM

Please mark
your votes as [X]
indicated in
this example

Management Recommends a vote FOR FOR all nominees WITHHOLD
all nominees. (except as indicated to AUTHORITY to vote
the contrary below) for all nominees
PROPOSAL 1 - ELECTION OF DIRECTORS [ ] [ ]

D. W. Gittinger; E. Hernandez, Jr.; J. A. McMillan;
B. A. Nordstrom; J. N. Nordstrom; A. E. Osborne, Jr.;
W. D. Ruckelshaus; B. G. Willison; A. A. Winter

To withhold authority to vote for any individual nominee, write that nominee's
name on the space provided below.

_______________________________________

FOR AGAINST ABSTAIN
PROPOSAL 2 - RATIFICATION OF APPOINTMENT OF AUDITORS Management Recommends a
vote FOR Proposal 2. [ ] [ ] [ ]

PROPOSAL 3 - SHAREHOLDER PROPOSAL REGARDING PERFORMANCE - BASED EXECUTIVE
COMPENSATION Management Recommends a vote AGAINST Proposal 3. [ ] [ ] [ ]

PROPOSAL 4 - SHAREHOLDER PROPOSAL REGARDING VENDOR STANDARDS COMPLIANCE
MECHANISMS Management Recommends a vote AGAINST Proposal 4. [ ] [ ] [ ]

PROPOSAL 5 - SHAREHOLDER PROPOSAL REGARDING GLOBAL HUMAN RIGHTS STANDARDS
Management Recommends a vote AGAINST Proposal 5. [ ] [ ] [ ]

Signature(s)______________________________________________ Dated _________, 2001
PLEASE SIGN AS YOUR NAME APPEARS ON THIS PROXY. Joint signers should each
sign. Trustees, Guardians, Personal and other Representatives, please indicate
your full title.

- FOLD AND DETACH HERE -
--------------------------------------------------------------------------------

NORDSTROM.com - THERE'S ALWAYS A STORE NEAR YOU.

NORDSTROM