Exhibit 10.45
nonqualified stock option agreement time-vested option
2006
A NONQUALIFIED STOCK OPTION GRANT for the number of shares of Common Stock
(hereinafter the “Option”) as noted in your Notice of Grant of Stock Options, of
Nordstrom, Inc., a Washington Corporation (the “Company”), is hereby granted to
the “Optionee.” The option price is as noted in your Notice of Grant of Stock
Options and was determined as provided in, and is subjected to, the terms of the
Nordstrom, Inc. 2004 Equity Incentive Plan (the “Plan”) adopted by the Company
and approved by its shareholders, which is incorporated in this agreement. To
the extent inconsistent with this agreement, the terms of the Plan shall govern.
The Compensation Committee of the Board has the discretionary authority to
construe and interpret the Plan and this Agreement. The Option is subject to the
following:

1.   OPTION PRICE       The option price is one hundred percent (100%) of the
fair market value of the Company’s Common Stock, as determined by the closing
price of the Company’s Common Stock on the New York Stock Exchange on the date
of the grant (as indicated in the Notice of Grant of Stock Options).   2.  
VESTING AND EXERCISING OF OPTION       Except as set forth in Section 4, the
Option shall vest and be exercisable in accordance with the provisions of the
Plan as follows:

  (a)   Schedule of Vesting and Rights to Exercise.

          Years of Continuous Service   Percent of   Following Grant of Option  
Option Vested
After 1 year
    25 %
After 2 years
    50 %
After 3 years
    75 %
After 4 years
    100 %

  (b)   Method of Exercise. The Option shall be exercisable (only to the extent
vested) by a written notice that shall:

  (i)   state the election to exercise the Option, the number of shares, the
total option price, and the name, address and social security number of the
Optionee;     (ii)   be signed by the person entitled to exercise the Option;
and     (iii)   be in writing and delivered to Nordstrom Leadership Benefits
(either directly or through a stock broker).

      The Company has made arrangements with a broker for stock option
management and exercises. Procedures for management and exercises shall be
disseminated to the Optionee with the agreement.         Payment of the purchase
price of any shares with respect to which an Option is being exercised shall be
by check or bank wire transfer, by means of the surrender of shares of Common
Stock previously held for at least six months by Optionee, or where not acquired
by Optionee by exercising a stock option, having a fair market value at least
equal to the exercise price, or by giving an irrevocable direction for a
securities broker approved by the Company to sell all or part of the Option
shares and to deliver to the Company from the sale proceeds an amount sufficient
to pay the option exercise price and any withholding taxes. (The balance of the
sale proceeds, if any, will be delivered to the Optionee.)         The
certificate(s) or shares of Common Stock as to which the Option shall be
exercised shall be registered in the name of the person(s) exercising the Option
unless another person is specified. An Option hereunder may not at any time be
exercised for a fractional number of shares.     (c)   Restrictions on Exercise.
These Options may not be exercised if the issuance of the shares upon such
exercise would constitute a violation of any applicable federal or state
securities or other law or valid regulation. As a condition to the exercise of
these Options, the Company may require the person exercising the Options to make
any representation and warranty to the Company as the Company’s counsel advises
and as may be required by the Company or by any applicable law or regulation.

3.   NONTRANSFERABILITY OF OPTIONS       The Option may not be sold, pledged,
assigned or transferred in any manner otherwise than by will or the laws of
descent and distribution and, except as set forth in Section 4 below, may be
exercised during the lifetime of the Optionee only by the Optionee or by the
guardian or legal representative of the Optionee. The terms of the Option shall
be binding upon the executors, administrators, heirs and successors of the
Optionee.   4.   TERMINATION OF EMPLOYMENT       Except as set forth below, a
vested Option may only be exercised while the Optionee is an employee of the
Company. If an Optionee’s employment is terminated, the Optionee or his or her
legal representative shall have the right to exercise the Option after such
termination as follows:

  (a)   If the Optionee dies while employed by the Company, the persons to whom
the Optionee’s rights have passed by will or the laws of descent and
distribution may exercise such rights. If the Option was granted at least six
months prior to

1 | Nonqualified Stock Option Agreement Time-vested Option

 

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      the death of the Optionee while employed by the Company, it shall continue
to vest and may be exercised during the period ending four years after the
Optionee’s death, but in no event later than 10 years after the date of grant.
If the Option was granted less than six months prior to death, such Option shall
be terminated as of that date.     (b)   If the Optionee’s employment is
terminated due to his or her embezzlement or theft of Company funds,
defraudation of the Company, violation of Company rules, regulations or
policies, or any intentional act that harms the Company, such Option, to the
extent not exercised as of the date of termination, shall be terminated as of
that date.     (c)   If the Optionee is separated due to disability, as defined
in Section 22(e)(3) of the Internal Revenue Code, the Option, if granted at
least six months prior to such separation, shall continue to vest and may be
exercised during the period ending four years after separation, but in no event
later than 10 years after the date of grant. If the Option was granted less than
six months prior to disability, such Option shall be terminated as of that date.
    (d)   If the Optionee is separated due to retirement between the ages of 53
and 57 with 10 continuous years of service to the Company or upon attaining age
58, the Option, if granted at least six months prior to such retirement, shall
continue to vest and may be exercised during the period ending four years after
separation, but in no event later than 10 years after the date of grant. If the
Option was granted less than six months prior to retirement, such Option shall
be terminated as of that date.     (e)   If the Optionee is separated for any
reason other than those set forth in subparagraphs (a), (b), (c) and (d) above,
the Optionee may exercise his or her Option, to the extent vested as of the date
of his or her separation, within 100 days after separation, but in no event
later than 10 years after the date of grant.

5.   TERM OF OPTIONS       The Option may not be exercised more than 10 years
from the date of original grant of these Options, and the vested portion of such
option may be exercised during such term only in accordance with the Plan and
the terms of this Option.   6.   ADJUSTMENTS UPON CHANGES IN CAPITALIZATION    
  The number and kind of shares of Company stock subject to this Option shall be
appropriately adjusted, pursuant to the Plan, along with a corresponding
adjustment in the option price to reflect any stock dividend, stock split,
split-up or any combination or exchange of shares, however accomplished.   7.  
ADDITIONAL OPTIONS       The Nordstrom Compensation Committee of the Board of
Directors may or may not grant the Optionee additional stock options in the
future. Nothing in this Option or any future grant should be construed as
suggesting that additional grants of options to the Optionee will be
forthcoming.   8.   LEAVES OF ABSENCE AND PART-TIME WORK       For purposes of
this Option, the Optionee’s service does not terminate due to a military leave,
a sick leave or another bona fide leave of absence if the leave was approved by
the Company in writing and if continued crediting of service is required by the
terms of the leave or by applicable law. But service terminates when the
approved leave ends unless the Optionee immediately returns to active work.    
  If the Optionee goes on a leave of absence, then the vesting schedule
specified in the Notice of Grant of Stock Options may be adjusted in accordance
with the Company’s leave of absence policy or the terms of the leave.   9.   TAX
WITHHOLDING       In the event that the Company determines that it is required
to withhold any tax as a result of the exercise of this Option, the Optionee, as
a condition to the exercise of their Options, shall make arrangements
satisfactory to the Company to enable it to satisfy all withholding
requirements.   10.   RIGHTS AS A SHAREHOLDER       Neither the Optionee nor the
Optionee’s representative shall have any rights as a shareholder with respect to
any Common Shares subject to this Option, until (i) the Optionee or the
Optionee’s representative becomes entitled to receive such Common Shares by
filing a notice of exercise and paying the Option Price pursuant to this Option,
and (ii) the Optionee or Optionee’s representative has satisfied any other
requirement imposed by applicable law or the Plan.   11.   NO RETENTION RIGHTS  
    Nothing in this Option or in the Plan shall give the Optionee the right to
be retained by the Company (or a subsidiary of the Company) as an employee or in
any capacity. The Company and its subsidiaries reserve the right to terminate
the Optionee’s service at any time, with or without cause.   12.   ENTIRE
AGREEMENT       The Notice of Grant of Stock Options, this agreement and the
Plan constitute the entire contract between the parties hereto with regard to
the subject matter hereof. They supersede any other agreements, representations
or understandings (whether oral or written and whether express or implied) that
relate to the subject matter hereof.   13.   CHOICE OF LAW       This agreement
shall be governed by, and construed in accordance with, the laws of the State of
Washington, as such laws are applied to contracts entered into and performed in
such State.

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2 | Nonqualified Stock Option Agreement Time-vested Option
10876_0306 • PDF

 

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Nordstrom, Inc.
Notice of Grant of Stock Options

     
<First Name> <Last Name>
  ID: <Employee#>
 
  Grant No: <Option Grant #>

On February 22, 2006, you were awarded nonqualified stock options under the
Nordstrom, Inc. 2004 Equity Incentive Plan to purchase <# of Options> shares of
Nordstrom, Inc. stock at $40.27 per share.
Your grant will vest over the four-year vesting period as outlined below:

          Shares   Vest Date   Expiration
<Vest 1>
  2/22/2007   2/22/2016
 
       
<Vest 2>
  2/22/2008   2/22/2016
 
       
<Vest 3>
  2/22/2009   2/22/2016
 
       
<Vest 4>
  2/22/2010   2/22/2016

Please keep this Notice for your records.
If you have any questions about your grant, please call Nordstrom Leadership
Benefits at (206) 303-5855, tie line 8-805-5855 or e-mail
leadership.benefits@nordstrom.com.