We have a well-recognized culture and reputation that consumers may associate with a high level of integrity, customer service and quality  merchandise, and it is one of the reasons customers shop with us and employees choose us as a place of employment. Any significant  damage to our reputation could negatively impact sales, diminish customer trust, reduce employee morale and productivity and lead to  difficulties in recruiting and retaining qualified employees. In May 2014, we announced that we are reviewing options for a financial partner for our credit card receivables. This review may not result in  a consummated transaction, and further, could divert management’s attention away from our core Retail business, negatively impacting our  execution on our customer strategy. If we do not successfully execute a transaction that meets our needs or fail to properly allocate our  capital to maximize returns, our operations, cash flows and returns to shareholders could be adversely affected. Additionally, credit rating  agencies may downgrade our business, which could adversely impact our operations and cash flows. Although we do not expect any change  to the customer experience following a transaction, if such a transaction negatively impacts the customer service associated with our credit  cards, this could harm our business and reputation, harming our competitive position. We have regularly reported in our annual proxy statements the holdings of members of the Nordstrom family, including Bruce A. Nordstrom,  our former Co-President and Chairman of the Board, his sister Anne E. Gittinger and members of the Nordstrom family within our Executive  Team. In our proxy statement as of March 2, 2015, for the 2015 Annual Meeting of Shareholders, these individuals owned an aggregate of  approximately 27% of our common stock. As a result, either individually or acting together, they may be able to exercise considerable  influence over matters requiring shareholder approval. As reported in our periodic filings, our Board of Directors has from time to time  authorized share repurchases. While these share repurchases may be offset in part by share issuances under our equity incentive plans and  as consideration for acquisitions, the repurchases may nevertheless have the effect of increasing the overall percentage ownership held by  these shareholders. The corporate law of the state of Washington, where the company is incorporated, provides that approval of a merger or  similar significant corporate transaction requires the affirmative vote of two-thirds of a company’s outstanding shares. The beneficial  ownership of these shareholders may have the effect of discouraging offers to acquire us, delay or otherwise prevent a significant corporate  transaction because the consummation of any such transaction would likely require the approval of these shareholders. As a result, the  market price of our common stock could be affected. We have invested in or are pursuing strategic growth opportunities, which may include acquisitions of, or investments in, other businesses,  as well as new technologies or other investments to provide a superior customer shopping experience in our stores and online. Additionally,  our business model will continue to rely more on partnerships with third parties for certain strategic initiatives and technologies. If these  investments, acquisitions or partnerships do not perform as expected or create operational difficulties, our profitability and growth could be  adversely affected.  During economic downturns, fewer customers may shop for the high-quality items in our stores and on our websites as they may be seen as  discretionary and those who do shop may limit the amount of their purchases. This reduced demand may lead to lower sales, higher  markdowns and increased marketing and promotional spending. We compete with other national, regional, local and online retailers that may carry similar lines of merchandise, including department stores,  specialty stores, off-price stores, boutiques and Internet businesses. The retail environment is rapidly evolving with customer shopping  preferences continuing to shift online and we expect competition in the ecommerce market to intensify in the future as the Internet facilitates  competitive entry and comparison shopping. We may lose market share to our competitors and our sales and profitability could suffer if we  are unable to remain competitive in the key areas of price and value, fashion newness, quality of products, depth of selection, convenience,  fulfillment, service and the shopping experience, including the online and store environment and store location. Our financial model is  changing to match customer shopping preferences, but if we do not properly allocate our capital between the store and online environment,  or adjust the effectiveness and efficiency of our stores, our overall sales and profitability could suffer. Our Credit segment faces competition from other retailers who also offer credit card products with associated loyalty programs, large banks  and other credit card companies, some of which have substantial financial resources. If we do not effectively anticipate or respond to the  competitive banking and credit card environments, we could lose market share to our competitors. 8 Our business could suffer if we do not appropriately assess and react to competitive market forces and changes in customer  behavior.  A downturn in economic conditions could have a significant adverse effect on our business.  RISKS DUE TO ECONOMIC AND EXTERNAL MARKET FACTORS Investment and partnerships in new business strategies and acquisitions could disrupt our core business.  The concentration of stock ownership in a small number of our shareholders could limit your ability to influence corporate matters. The potential transaction related to our credit card receivables could adversely impact our business. Our customer and employee relationships could be negatively affected if we fail to maintain our corporate culture and reputation.