[LOGO]
One Bowerman Drive
Beaverton, Oregon 97005-6453
August 7, 1995
To Our Shareholders:
You are cordially invited to attend the annual meeting of shareholders
of NIKE, Inc. to be held at the NIKE World Headquarters, One Bowerman
Drive, Beaverton, Oregon on Monday, September 18, 1995, at 10:00 A.M.
Registration will begin at 9:30 A.M.
I believe that the annual meeting provides an excellent opportunity for
shareholders to become better acquainted with NIKE and its directors and
officers. I hope that you will be able to attend.
Whether or not you plan to attend, the prompt execution and return of
your proxy card will both assure that your shares are represented at the
meeting and minimize the cost of proxy solicitation.
Sincerely,
(Signature of Philip H. Knight
Philip H. Knight
CHAIRMAN OF THE BOARD
AND CHIEF EXECUTIVE OFFICER
[LOGO]
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
SEPTEMBER 18, 1995
------------------------
To the Shareholders of NIKE, Inc.
The annual meeting of shareholders of NIKE, Inc., an Oregon corporation,
will be held on Monday, September 18, 1995, at 10:00 A.M., Pacific Daylight
Time, at the NIKE World Headquarters, One Bowerman Drive, Beaverton, Oregon,
for the following purposes:
1. To elect a Board of Directors for the ensuing year.
2. To amend the Articles of Incorporation to increase the number of
authorized shares.
3. To approve the proposed Executive Performance Sharing Plan to
satisfy certain Internal Revenue Code requirements.
4. To ratify the appointment of Price Waterhouse as independent
accountants.
5. To transact such other business as may properly come before
the meeting.
All shareholders are invited to attend the meeting. Shareholders
of record at the close of business on July 21, 1995, the record date
fixed by the Board of Directors, are entitled to notice of and to vote at
the meeting.
By Order of the Board of Directors
JOHN E. JAQUA
SECRETARY
Beaverton, Oregon
August 7, 1995
Whether or not you intend to be present at the meeting, please sign and
date the enclosed proxy and return it in the enclosed envelope.
PROXY STATEMENT
The enclosed proxy is solicited by the Board of Directors of NIKE, Inc.
("NIKE" or the "Company") for use at the annual meeting of shareholders to
be held on September 18, 1995, and at any adjournment thereof (the "Annual
Meeting"). The Company expects to mail this proxy statement and the
enclosed proxy to shareholders on or about August 7, 1995.
The Company will bear the cost of solicitation of proxies. In addition
to the solicitation of proxies by mail, certain officers and employees of
the Company, without extra compensation, may also solicit proxies
personally or by telephone. The Company has retained Hill and Knowlton,
Inc., New York, New York, to assist in the solicitation of proxies from
nominees and brokers at an estimated cost of $16,000. Copies of proxy
solicitation materials will be furnished to fiduciaries, custodians and
brokerage houses for forwarding to the beneficial owners of shares held
in their names.
All valid proxies properly executed and received by the Company prior
to the Annual Meeting will be voted in accordance with the instructions
specified in the proxy. Where no instructions are given, shares will be
voted FOR: (1) the election of each of the named nominees for director;
(2) the approval of the proposed Executive Performance Sharing Plan to
satisfy certain Internal Revenue Code requirements; (3) the approval of
the increase in the authorized common stock; and (4) ratification of the
appointment of Price Waterhouse as independent accountants. A shareholder
may chose to strike the names of the proxy holders named in the enclosed
proxy and insert other names.
A shareholder giving the enclosed proxy has the power to revoke it
at any time before it is exercised by affirmatively electing to vote in
person at the meeting or by delivering to Lindsay D. Stewart, Assistant
Secretary of the Company, either an instrument of revocation or an
executed proxy bearing a later date.
VOTING SECURITIES
Holders of record of NIKE's Class A Common Stock ("Class A Stock") and
holders of record of NIKE's Class B Common Stock ("Class B Stock"), at the
close of business on July 21, 1995, will be entitled to vote at the Annual
Meeting. On that date, shares of Class A Stock and
shares of Class B Stock were issued and outstanding. Neither class of
Common Stock has cumulative voting rights.
Each share of Class A Stock and each share of Class B Stock is entitled
to one vote on every matter submitted to the shareholders at the Annual
Meeting. With regard to Proposal 1, the election of directors, the holders
of Class A Stock and the holders of Class B Stock will vote separately.
Holders of Class B Stock are currently entitled to elect 25 percent of
the total Board, rounded up to the next whole number. Holders of Class A
Stock are currently entitled to elect the remaining directors. Under
this formula, holders of Class B Stock, voting separately, will elect four
directors, and holders of Class A Stock, voting separately, will elect
10 directors. Holders of Class A Stock and holders of Class B Stock will
vote separately on Proposal 2 and together as one class on Proposals 3
and 4.
PROPOSAL 1
ELECTION OF DIRECTORS
A Board of 14 directors will be elected at the Annual Meeting. All of
the nominees, except for Dr. A. Michael Spence, were elected at the 1994
annual meeting of shareholders. Directors will hold office until the next
annual meeting of shareholders or until their successors are elected and
qualified.
William J. Bowerman, Thomas E. Clarke, Delbert J. Hayes and Jill K.
Conway are nominated by management for election by the holders of Class B
Stock. The other 10 nominees are nominated by management for election by
the holders of Class A Stock.
Under Oregon law, if a quorum of each class of shareholders is present
at the Annual Meeting, the 10 director nominees who receive the greatest
number of votes cast by holders of Class A Stock and the four director
nominees who receive the greatest number of votes cast by holders of Class B
Stock will be elected directors. Abstentions and broker non-votes will have
no effect on the results of the vote. Unless otherwise instructed, proxy
holders will vote the proxies they receive for the nominees listed below.
If any nominee becomes unable to serve, the holders of the proxies may, in
their discretion, vote the shares for a substitute nominee or nominees
designated by the Board of Directors.
Background information on the nominees as of July 15, 1995, appears
below:
NOMINEES FOR ELECTION BY CLASS A SHAREHOLDERS
RALPH D. DENUNZIO--Mr. DeNunzio, 63, a director of the Company
since 1988, is President of Harbor Point Associates, Inc., New York,
New York, a private investment and consulting firm. Mr. DeNunzio was
employed by the investment banking firm of Kidder, Peabody & Co.
Incorporated from 1953 to 1987, where he served as President from 1977
to 1986, as Chief Executive Officer from 1980 to 1987 and as Chairman
of the Board of Directors from 1986 to 1987. Mr. DeNunzio served as Vice
Chairman and Chairman of the Board of Governors of the New York Stock
Exchange from 1969 to 1972 and was President of the Securities
Industry Association in 1981. In 1970, Mr. DeNunzio headed the Securities
Industry Task Force, which led to enactment of the Securities Investor
Protection Act of 1970 and establishment of the Securities Investor
Protection Corporation. He is also a director of AMP Incorporated, Federal
Express Corporation and Harris Corporation.
RICHARD K. DONAHUE--Mr. Donahue, 68, a director of the Company since
1977, is Vice Chairman of the Board. He served as President and Chief
Operating Officer of the Company from June 1990 until June 1994. He has
been a partner in the law firm of Donahue & Donahue, Lowell, Massachusetts,
since 1951. From 1961 to 1963, Mr. Donahue was an assistant to President
John F. Kennedy. Mr. Donahue is a former President of the Massachusetts
Bar Association and the New England Bar Association. He is a member of
the John F. Kennedy Library Foundation and the Chairman of the Foundation's
Profiles in Courage Award Committee. He is a trustee of the Joyce
Foundation. Mr. Donahue is also a director of Epitope, Inc. and Courier
Corp.
DOUGLAS G. HOUSER--Mr. Houser, 60, a director since 1970, is an
Assistant Secretary of the Company and has been a partner in the Portland,
Oregon law firm of Bullivant, Houser, Bailey, Pendergrass & Hoffman
since 1965. Mr. Houser is a trustee of Willamette University and a
fellow in the American College of Trial Lawyers, and has served as a member
of the Board of Governors and Treasurer of the Oregon State Bar
Association. Mr. Houser and Philip H. Knight are first cousins.
JOHN E. JAQUA--Mr. Jaqua, 74, a director since 1968, is Secretary of
NIKE and has been a principal in the law firm of Jaqua & Wheatley, P.C.,
Eugene, Oregon, since 1962. Mr. Jaqua has served as President of the
Oregon State Bar Association and as a State Delegate to the House of
Delegates of the American Bar Association.
PHILIP H. KNIGHT--Mr. Knight, 57, a director since 1968, is Chief
Executive Officer and Chairman of the Board of Directors of NIKE. Mr.
Knight is a co-founder of the Company and, except for the period from June
1983 through September 1984, served as its President from 1968 to June
1990. Prior to 1968, Mr. Knight was a certified public accountant with
Price Waterhouse and Coopers & Lybrand and was an Assistant Professor of
Business Administration at Portland State University.
KENICHI OHMAE--Mr. Ohmae, 52, was, until his resignation July 1,
1994, Managing Director of McKinsey & Company, Inc., an international
business consulting firm, with which he has been employed for over 20
years. Mr. Ohmae serves as an advisor to many large companies in various
industries around the world. He is the author of numerous books on global
business strategy, including THE BORDERLESS WORLD, THE MIND OF THE
STRATEGIST, TRIAD POWER: THE COMING SHAPE OF GLOBAL COMPETITION, and BEYOND
NATIONAL BORDERS: REFLECTIONS ON JAPAN AND THE WORLD. He is also a Director
of Heisei Research Institute in Japan.
RALPH A. PFEIFFER, JR.--Mr. Pfeiffer, 68, a director since June
1992, retired in 1986 as IBM Senior Vice President, Chairman and Chief
Executive Officer of IBM World Trade Corporation, and Chairman and Chief
Executive Officer of IBM World Trade Asia Pacific Group B. In 1974, he was
elected an IBM Senior Vice President and became Chairman and Chief Executive
Officer of the IBM World Trade Americas/Far East Corporation. In 1983,
he was named a member of the Corporate Management Board and, in 1984, was
appointed Chairman and Chief Executive Officer of the IBM World Trade
Corporation. Mr. Pfeiffer is a director of Campbell Soup Company, The Royal
Bank of Canada, IBM World Trade Corporation, Osiris Therapeutics, Inc.,
Arthur D. Little, Inc., and New York Life Mainstay Funds. He is also a
member of the Council on Foreign Relations; a member of the Economic Club
of New York; a member of the Inter-American Dialogue; a member of the
International Advisory Board, University of South Carolina; and a member
of the Board of Trustees of Covenant House.
CHARLES W. ROBINSON--Mr. Robinson, 75, a director since 1978, is
Chairman and President of Robinson & Associates, Inc., Santa Fe, New
Mexico, an energy consulting firm. From January 1978 to January 1979,
Mr. Robinson was Vice Chairman of the Board of Blyth, Eastman, Dillon &
Co., Inc. and from March 1977 to December 1977, was Senior Managing
Director of Kuhn Loeb & Co., Incorporated.Mr. Robinson served as Under-
secretary of State for Economic Affairs from 1974 to 1976, at which time
he was appointed Deputy Secretary of State. From 1964 to 1974, Mr.
Robinson was President of Marcona Corporation. Mr. Robinson is also a
director of The Allen Group, Inc., a trustee of The Brookings Institution,
and a member of the Council on Foreign Relations.
A. MICHAEL SPENCE--Dr. Spence, 51, has been the Philip H. Knight
Profesor and Dean of the Graduate School of Business at Stanford
University since 1990. From 1984 to 1990 he was Dean of the Faculty
of Arts and Sciences at Harvard University. He was professor of
economics and business administration at Harvard University from 1977
to 1986. He is the author of three books and numerous articles on
economics and business. Dr. Spence is also a director of Bank of
America NT & SA, Sun Microsystems, Inc., Verifone, Inc. and General
Mills, Inc.
JOHN R. THOMPSON, JR.--Mr. Thompson, 53, a director since 1991, has
been head coach of the Georgetown University men's basketball team since
1972. Mr. Thompson also serves as Assistant to the President of Georgetown
for Urban Affairs. Mr. Thompson was head coach of the 1988 United States
Olympic basketball team. He is a past President of the National
Association of Basketball Coaches and presently serves on its Board of
Governors.
NOMINEES FOR ELECTION BY CLASS B SHAREHOLDERS
WILLIAM J. BOWERMAN--Mr. Bowerman, 84, a director since 1968, has
served as Deputy Chairman of the Board and Senior Vice President of NIKE
since 1980. Mr. Bowerman is a co-founder of the Company and served as
Vice President from 1968 to 1980. From 1949 to 1972, Mr. Bowerman was
head track coach at the University of Oregon, and he served as coach of
the United States Olympic track team in 1972.
THOMAS E. CLARKE--Dr. Clarke, 44, joined the Company in 1980, and
was elected President and Chief Operating Officer in June 1994. Dr. Clarke
has held various positions with the Company, primarily in research, design,
development and marketing. He was appointed divisional vice president in
charge of marketing in 1987. He was elected Vice President in 1989 and
appointed General Manager in 1990. Dr. Clarke holds a Doctorate degree in
biomechanics.
JILL K. CONWAY--Dr. Conway, 60, a director since 1987, is currently a
Visiting Scholar with the Massachusetts Institute of Technology's Program
in Science, Technology and Society. Dr. Conway was President of Smith
College, Northampton, Massachusetts, from 1975 to 1985. She was
affiliated with the University of Toronto from 1964 to 1975, and held the
position of Vice President, Internal Affairs from 1973 to 1975. Her field
of academic specialty is history. Dr. Conway is currently a director of
Merrill Lynch & Co., Inc., Arthur D. Little, Inc., The Allen Group, Inc.,
and Colgate-Palmolive Company and a member of the Advisory Board of IBM
World Trade Americas/Far East Corporation. She is currently a trustee of
Mount Holyoke College and New England Medical Center.
DELBERT J. HAYES--Mr. Hayes, 60, a director since 1975, served as
Executive Vice President of NIKE from 1980 to -------, 1995. Mr. Hayes
served as Treasurer and in a number of other executive positions with
the Company from 1975 to 1980. Mr. Hayes was a partner with Hayes,
Nyman & Co., certified public accountants, from 1970 to 1975. Prior to
1970, Mr. Hayes was a certified public accountant with Price Waterhouse
for eight years.
BOARD OF DIRECTORS AND COMMITTEES
The Board currently has an Executive Committee, an Audit Committee, a
Personnel Committee, a Finance Committee, a Stock Option Committee and may
also appoint other committees from time to time. There is currently no
Nominating Committee. There were six meetings of the Board of Directors
during the last fiscal year. Each director attended at least 75 percent of
the total number of meetings of the Board of Directors and committees on
which he or she served, except for Messrs. Donahue and Thompson, who
attended 67 percent and 70 percent respectively.
The Executive Committee of the Board is currently composed of Messrs.
Knight (Chairman) and Clarke. The Executive Committee is authorized to
act on behalf of the Board on all corporate actions for which applicable
law does not require participation by the full Board. In practice, the
Executive Committee acts in place of the full Board only when emergency
issues or scheduling make it difficult or impracticable to assemble the
full Board. All actions taken by the Executive Committee must be reported
at the next Board meeting. The Executive Committee held no formal meetings
during the fiscal year ended May 31, 1995, but took actions from time to
time pursuant to written consent resolutions.
The Audit Committee is currently composed of Mr. Hayes (Chairman), Mr.
Houser and Mr. Pfeiffer. The Audit Committee reviews and makes
recommendations to the Board regarding services provided by the independent
accountants, reviews with the independent accountants the scope and results
of their annual examination of the Company's consolidated financial
statements and any recommendations they may have, and makes recommendations
to the Board with respect to the engagement or discharge of the independent
accountants. The Audit Committee also reviews the Company's procedures with
respect to maintaining books and records, the adequacy and implementation of
internal auditing, accounting and financial controls, and the Company's
policies concerning financial reporting and business practices. The Audit
Committee met twice during the fiscal year ended May 31, 1995.
The Personnel Committee is currently composed of Mr. DeNunzio
(Chairman), Dr. Conway, Mr. Jaqua, and Mr. Thompson. The Personnel
Committee makes recommendations to the Board regarding officers'
compensation, management incentive compensation arrangements and profit
sharing plan contributions. The Personnel Committee met four times during
the fiscal year ended May 31, 1995.
The Finance Committee is currently composed of Messrs. Robinson
(Chairman), DeNunzio, Hayes and Pfeiffer. The Finance Committee considers
long-term financing options and needs of the Company, long-range tax and
currency issues facing the Company, and management recommendations
concerning major capital expenditures and material acquisitions or
divestments. The Finance Committee met five times during the fiscal
year ended May 31, 1995.
The Stock Option Committee is currently composed of Mr. DeNunzio
(Chairman), Dr. Conway, Mr. Jaqua and Mr. Thompson. The Stock Option
Committee grants options under NIKE's employee stock option plans. The
Stock Option Committee met three times during the fiscal year ended
May 31, 1995.
DIRECTOR COMPENSATION AND RETIREMENT PLAN
Messrs. Knight and Clarke do not receive additional compensation
for their services as directors. All other directors are paid a fee of
$18,000 per year plus $2,000 for each Board meeting attended and $1,000
for each committee meeting attended, except that no fee is paid for
attending Stock Option Committee meetings. In addition, directors are
reimbursed for travel and other expenses incurred in attending Board and
committee meetings. The Company also provides its non-employee directors
medical insurance and $500,000 of life insurance coverage.
In 1989 and 1993 the Board of Directors approved resolutions that
provide certain benefits to directors who have served in that capacity for
five years or more. The plan provides that after ten years of service by a
non-employee director, the Company will provide such director for the
remainder of his or her life with $500,000 of life insurance and medical
insurance at the levels provided by the Company to all of its employees at
the time such director retires. The plan also provides that a
director who has served for at least five years will receive an annual
retirement benefit for life, commencing on the later of age 65 or the date
the director retires or ceases to be a member of the Board. New directors
elected after the 1993 fiscal year must retire at age 72. The retirement
benefit is equal to a sliding percentage of the director's last annual Board
fee (excluding meeting fees) beginning at 50 percent of the Board fee for
five years of service up to a maximum of 100 percent of the Board fee for
10 or more years of service.
STOCK HOLDINGS OF CERTAIN OWNERS AND MANAGEMENT
The following table sets forth the number of shares of each class of
NIKE securities beneficially owned, as of July 15, 1995, by (i) each
person known to the Company to be the beneficial owner of more than 5
percent of any class of the Company's securities, (ii) each of the nominees
for director, (iii) each executive officer listed in the Summary Compensation
Table ("Named Officers"), and (iv) all nominees, Named Officers, and other
executive officers as a group. Because Class A Stock is convertible into Class
B Stock on a share-for-share basis, each beneficial owner of Class A Stock is
deemed by the Securities and Exchange Commission to be a beneficial owner of
the same number of shares of Class B Stock. Therefore, in indicating a
person's beneficial ownership of shares of Class B Stock in the table, it has
been assumed that such person has converted into Class B Stock all shares of
Class A Stock of which such person is a beneficial owner. For these reasons
the table contains substantial duplications in the numbers of shares and
percentages of Class A and Class B Stock shown for Messrs. Knight, Bowerman,
Hayes and Jaqua and for all directors and officers as a group.
<TABLE>
<CAPTION>
SHARES PERCENT
TITLE OF BENEFICIALLY OF
CLASS OWNED(1) CLASS(8)
--------------- ---------------- -----------
<S> <C> <C> <C>
William J. Bowerman Class A 29,040 0.1%
Eugene, Oregon Class B 42,812
Thomas E. Clarke(5) Class B 88,732(2)(3) 0.2%
Portland, Oregon
Jill K. Conway Class B 40,400(2)
Milton, Massachusetts
Ralph D. DeNunzio Class B 62,000(2) 0.1%
Riverside, Connecticut
Richard K. Donahue Class B 264,783(2) 0.6%
Portland, Oregon
Delbert J. Hayes Class A 200,000 0.8%
Newberg, Oregon Class B 211,383(3) 0.5%
Douglas G. Houser Class B 22,000
Portland, Oregon
John E. Jaqua Class A 196,489 0.8%
Eugene, Oregon Class B 196,882 0.4%
Philip H. Knight(5) Class A 24,272,898(4) 93.7%
Beaverton, Oregon Class B 24,273,098(4) 34.8%
Kenichi Ohmae Class B 3,000(2)
Tokyo, Japan
Ralph A. Pfeiffer, Jr. Class B 19,000(2)
New York, New York
Charles W. Robinson Class B 162,500 0.4%
Santa Fe, New Mexico
Michael Spence
Palo Alto, CA
John R. Thompson, Jr. Class B 19,500(2)
Washington, D.C.
Harry A. Carsh(5) Class B 7,644(2)(3)
Tigard, Oregon
Mark G. Parker(5) Class B 34,240(2)(3)
Portland, Oregon
David B. Taylor(5) Class B 78,389(2)(3) 0.2%
Beaverton, Oregon
Nissho Iwai American Corporation Preferred(6) 300,000 100.0%
Portland, Oregon
Franklin Resources, Inc. Class B 2,371,500(7) 5.2%
San Mateo, California
All directors and executive officers Class A 24,698,627 95.4%
as a group (20 persons) Class B 25,649,104(2) 36.5%
- ---------
(1) A person is considered to beneficially own any shares: (a) over which
such person exercises sole or shared voting or investment power, or (b)
of which such person has the right to acquire beneficial ownership at
any time within 60 days (i.e., through conversion of securities or
exercise of stock options). Unless otherwise indicated, voting and
investment power relating to the above shares is exercised solely by
the beneficial owner or shared by such owner and such owner's spouse
or children.
(2) These amounts include the right to acquire, pursuant to the exercise of
stock options, within 60 days after July 15, 1995, the following
numbers of shares: 88,368 shares for Dr. Clarke, 40,000 shares
for Dr. Conway, 60,000 shares for Mr. DeNunzio, 158,368 shares for
Mr. Donahue, 18,000 shares for Mr. Pfeiffer, 18,500 shares for
Mr. Thompson, 7,347 shares for Mr. Carsh, 33,765 shares for Mr.
Parker, 3,000 shares for Mr. Ohmae, 77,347 for Mr. Taylor, and
624,919 shares for the group.
(3) Includes shares held in account under the NIKE, Inc. 401(k) Employee
Savings Plan for Messrs. Clarke, Hayes, Carsh, Parker, and Taylor
in the amounts of 364, 83, 297, 475 and 642 shares, respectively.
(4) Includes 842,104 shares held by a limited partnership in which a
corporation owned by Mr. Knight's spouse is a co-general partner,
and 16,306 shares owned by such corporation. Mr. Knight has
disclaimed any beneficial ownership of such shares.
(5) Executive officer listed in the Summary Compensation Table.
(6) Preferred Stock does not have general voting rights except as
provided by law, and under certain circumstances as provided in the
Company's Restated Articles of Incorporation, as amended.
(7) Based on information as of December 31, 1994, contained in Schedule
13G filed with the Securities and Exchange Commission on or about
February 8, 1995.
(8) Omitted if less than 0.1 percent.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than
10 percent of a registered class of the Company's equity securities, to
file with the Securities and Exchange Commission, the New York Stock
Exchange and the Pacific Stock Exchange initial reports of ownership and
reports of changes in ownership of Common Stock and other equity
securities of the Company. Officers, directors and greater than 10 percent
shareholders are required by the regulations of the Securities and Exchange
Commission to furnish the Company with copies of all Section 16(a) forms
they file. To the Company's knowledge, based solely on review of the
copies of such reports furnished to the Company and written
representations that no other reports were required, during the fiscal year
ended May 31, 1995 all Section 16(a) filing requirements applicable to its
officers, directors and greater than 10 percent beneficial owners were
complied with.
EXECUTIVE COMPENSATION
The following table discloses compensation awarded to, earned by, or
paid to the Company's Chief Executive Officer and its next four most
highly compensated executive officers for all services rendered by them
in all capacities to the Company and its subsidiaries during the fiscal
year ended May 31, 1995 and the two preceding fiscal years.
SUMMARY COMPENSATION TABLE
</TABLE>
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
--------------------------------------------------- AWARDS
OTHER ANNUAL ------------- ALL OTHER
COMPEN- STOCK COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) SATION($) OPTIONS(#) SATION($)(1)(2)
- --------------------------- --------- ----------- ----------- -------------- ------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Philip H. Knight 1995 864,583 787,500 26,345(3) -- 500,000(4)
Chief Executive Officer 1994 750,000 150,000 68,315(3) -- 519,096
1993 750,000 300,000 45,889(3) -- 21,204
Thomas E. Clarke 1995 625,000 515,625 -- 33,473 4,546
President and 1994 370,833 112,438 -- 18,349 310,360
Chief Operating Officer 1993 318,319 117,000 -- 10,000 22,064
Mark G. Parker 1995 442,500 337,500 -- 15,063 59,006(5)
V.P. and General Manager 1994 357,083 99,806 -- 16,514 78,040
Consumer Product Marketing 1993 317,917 197,886 -- 10,000 49,268
Harry C. Carsh 1995 338,750 229,500 -- 13,389 8,125
V.P. and General Manager 1994 326,812 48,750 -- 14,679 28,105
Sports and Fitness 1993 300,000 96,000 -- 14,223 25,879
David B. Taylor 1995 322,917 219,375 -- 13,389 3,750
Vice President Production 1994 297,916 39,960 -- 14,679
1993 272,916 88,000 -- 14,223
</TABLE>
- ------------
(1) Includes contributions by the Company to the 401(k) Savings Plan
for the named officers. The contributions for the fiscal year ended
May 31, 1995 were $3,750 for each of Messrs. Clarke, Parker, Carsh
and Taylor. Profit Sharing Plan contributions for fiscal year
1995 have not been determined.
(2) Includes above-market interest on deferred compensation for Messrs.
Clarke, Parker and Carsh in the amount of $796, $856, and $4375,
respectively, for the fiscal 1995 year.
(3) The Company provided Mr. Knight with occasional non-business use of an
airplane. The Company's aggregate incremental cost for Mr. Knight's
non-business airplane use in fiscal years 1993, 1994 and 1995 was
$45,889, $65,795 and $23,145, respectively.
(4) The Company paid $500,000 towards a portion of the annual premium for
term life insurance on the life of Mr. Knight pursuant to a "split
dollar" plan. The Company would be reimbursed for its payments from
the proceeds of the life insurance policies in the event Mr. Knight dies.
(5) Pursuant to the terms of certain stock options, in fiscal year 1995 the
Company made a cash payment of $2.72 per share to Mr. Parker for the
exercise of 20,000 of Mr. Parker's stock options in fiscal year 1995
($54,400.00).
OPTION GRANTS IN THE FISCAL YEAR ENDED MAY 31, 1995
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
% OF TOTAL APPRECIATION FOR
OPTIONS GRANTED EXERCISE OR OPTION TERM(3)
OPTIONS TO EMPLOYEES IN BASE PRICE EXPIRATION ------------------
NAME GRANTED(#)(1) FISCAL YEAR ($/SHARE)(2) DATE 5%($) 10%($)
- ------------------------ --------------- --------------- ------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Philip H. Knight........ -- -- -- -- -- --
Thomas E. Clarke........ 33,473 6.3% $ 59.75 6/30/04 1,257,915 3,187,634
Mark G. Parker.......... 15,063 2.8% $ 59.75 6/30/04 566,068 1,434,449
Harry C. Carsh.......... 13,389 2.5% $ 59.75 6/30/04 503,159 1,275,034
David B. Taylor 13,389 2.5% $ 59.75 6/30/04 503,158 1,275,034
</TABLE>
- ------------
(1) All options shown in the table become exercisable with respect to 25%
of the total number of shares on each of July 1, 1995, 1996, 1997, and
1998. All options will become fully exercisable generally upon the
approval by the Company's shareholders of a merger, plan of exchange,
sale of substantially all of the Company's assets or plan of
liquidation.
(2) The exercise price is the market price of Class B Stock on the date the
options were granted.
(3) Assumed annual appreciation rates are set by the SEC and are not a
forecast of future appreciation. The actual realized value depends on
the market value of the Class B Stock on the exercise date, and no
gain to the optionees is possible without an increase in the price
of the Class B Stock. All assumed values are pre-tax and do not
include dividends.
AGGREGATED OPTION EXERCISES IN THE FISCAL YEAR ENDED MAY 31, 1995
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS
SHARES FISCAL YEAR-END(#) AT FISCAL YEAR-END($)(1)
ACQUIRED ON VALUE ----------------------------- ----------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------- ------------- ------------ ------------- -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Philip H. Knight......... -- -- -- -- -- --
Thomas E. Clarke......... -- -- 80,000 61,822 4,687,496 1,275,040
Mark G. Parker........... 20,000 1,078,100 30,000 41,577 1,890,900 890,873
Harry C. Carsh........... 14,000 662,505 -0- 48,291 -0- 1,150,480
David B. Taylor............-- -- 71,000 46,291 3,827,825 1,070,480
<FN>
- ------------
(1) Based on a fair market value as of May 31, 1995 of $78.25 per share.
Values are stated on a pre-tax basis.
</TABLE>
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE
COMPANY'S FILINGS UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
EXCHANGE ACT OF 1934, THE FOLLOWING REPORT AND THE PERFORMANCE GRAPH
ON PAGE ________ SHALL NOT BE INCORPORATED BY REFERENCE INTO ANY SUCH
FILINGS AND SHALL NOT OTHERWISE BE DEEMED FILED UNDER SUCH ACTS.
REPORT OF THE PERSONNEL COMMITTEE OF THE
BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION
The Personnel Committee of the Board of Directors (the "Committee"),
subject to the approval of the Board of Directors, determines the
compensation of the Company's executive officers and oversees the
administration of executive compensation programs, except that stock
option grants are made by the Stock Option Committee.
EXECUTIVE COMPENSATION POLICIES AND PROGRAMS. The Company's
executive compensation programs are designed to attract and retain
highly qualified executives and to motivate them to maximize shareholder
returns by achieving both short-and long-term strategic Company goals.
The programs link each executive's compensation directly to individual and
Company performance. A significant portion of each executive's total
compensation is variable and dependent upon the attainment of
strategic and financial goals, individual performance objectives,
and the appreciation in value of the Common Stock.
There are three basic components to the Company's "pay for performance"
system: base pay; annual incentive bonus; and long-term, equity-based
incentive compensation. Each component is addressed in the context of
individual and Company performance, competitive conditions and equity
among employees. In determining competitive compensation levels, the
Company analyzes information from several independent surveys which
include information regarding the general industry as well as other
consumer product companies. Since the Company's market for executive
talent extends beyond the sports and fitness industry, the survey
data includes global name-brand consumer product companies with
sales in excess of $1 billion. A comparison of the Company's financial
performance with that of the companies and indices shown in the
Performance Graph is only one of many factors considered by the
Committee to determine executive compensation.
BASE PAY. Base pay is designed to be competitive, although
conservative (generally in the second quartile) as compared to salary levels
for equivalent executive positions at other global consumer product
companies. The executive's actual salary within this competitive framework
will vary based on responsibilities, experience, leadership, potential
future contribution, and demonstrated individual performance (measured
against strategic management objectives such as maintaining customer
satisfaction, fostering innovative products, strengthening market share,
and expanding the markets for the Company's products). The types and
relative importance of specific financial and other business objectives
vary among the Company's executives depending on their positions and the
particular operations or functions for which they are responsible. The
Company's philosophy and practice is to place a relatively greater
emphasis on the incentive components of compensation.
ANNUAL INCENTIVE BONUS. Each executive is eligible to receive an
annual cash bonus under the Executive Performance Sharing Plan
(described later in this Proxy Statement). The "target" level for
that bonus, like the base salary level, is set with reference to
Company-wide bonus programs, as well as competitive conditions. These
target levels are intended to motivate the Company's executives
by providing substantial bonus payments for the achievement of
financial goals within the Company's business plan. An executive
receives a percentage of his or her target bonus depending on the
extent to which the Company achieves financial performance
goals set by the Committee and the Board, as measured by the Company's
net income before taxes. Bonuses may exceed the target if the Company's
performance exceeds the goal.
LONG-TERM, EQUITY-BASED INCENTIVE COMPENSATION. The long-term
equity-based compensation program is tied directly to shareholder
return. Under the current program, long-term incentive compensation
consists of stock options, 25% of which vest in each of the four years
after grant. Stock options are awarded with an exercise price equal to
the fair market value of the Class B Common Stock on the date of
grant. Accordingly, the executive is rewarded only if the market price
of the Class B Common Stock appreciates.
Since long-term options vest over time, the Company periodically
grants new options to provide continuing incentives for future performance.
The size of previous grants and the number of options held are considered
by the Stock Option Committee, but are not entirely determinative of future
grants. Like base pay, the grant is set with regard to competitive
considerations, and each individual's actual grant is based upon
individual performance measured against the criteria described in the
preceding paragraphs and the executive's potential for future contributions.
Stock options are designed to align the interests of the Company's
executives with those of shareholders by encouraging executives to enhance
the value of the Company and, hence, the price of the Common Stock and
the shareholders' return. In addition, through deferred vesting, this
component of the compensation system is designed to create an incentive
for the individual executive to remain with the Company.
OTHER PLANS. The Company maintains combined profit sharing and
401(k) retirement plans. Under the profit sharing retirement plan, the
Company annually contributes to a trust on behalf of employees, including
executive officers, an amount that has historically approximated 1.7%
of the Company's earnings. That percentage is determined by the Board of
Directors, and in the past five fiscal years has represented a yearly
contribution of between 5.07 to 8.42% of each employee's earnings. This
retirement plan serves to retain employees and executives, since profit
sharing funds do not fully vest until after five years of employment
with the Company.
Under the 401(k) retirement plan, the Company contributes up to 2.5%
of each employee's earnings as a matching contribution. This matching
contribution is invested entirely in NIKE Class B Stock, which strengthens
the linkage between employee and shareholder interests.
ANNUAL REVIEWS. Each year, the Committee reviews the executive
compensation policies with respect to the linkage between executive
compensation and the creation of shareholder value, as well as the
competitiveness of the programs. The Committee determines what changes,
if any, are appropriate in the compensation programs for the following
year. In conducting the annual review, the Committee considers information
provided by Human Resources staff and uses surveys and reports
prepared by independent compensation consultants.
Each year, the Committee, with the President and Human Resources
staff, reviews the individual performance of each of the other executive
officers and the President's recommendations with respect to the
appropriate compensation levels and awards. The Committee makes
recommendations to the Board of Directors for final approval of all
compensation matters except for stock option grants, which are made by
the Stock Option Committee. The Committee also reviews with the President
and the Human Resources staff the financial and other strategic
objectives, such as those identified above, for each of the senior
executive officers for the following year.
In fiscal year 1995, awards to executive officers as a group reflected
(i) the Company's record revenues and earnings, and (ii)
continued progress toward strategic goals such as expansion into
international markets. The Committee also considered the other factors
and considerations described above. Accordingly, as a group the named
executive officers received approximately 150% of their targeted
incentive bonuses.
CHIEF EXECUTIVE OFFICER. In reviewing Mr. Knight's performance, the
Committee focused primarily on the Company's outstanding performance in
fiscal year 1995, which resulted from substantial increases in sales
and earnings, and progress toward the achievement of various strategic
and financial objectives identified above. Accordingly, Mr. Knight
received an incentive bonus of $787,500. The Committee increased Mr.
Knight's base salary for the 1996 fiscal year to approximately $945,000.
Mr. Knight's position as the founder of and a substantial
shareholder in the Company provides an effective long-term performance
incentive tied directly to shareholder return. Accordingly, he received
no stock option awards.
SECTION 162(m) OF THE INTERNAL REVENUE CODE. The Company has
proposed an Executive Performance Sharing Plan for adoption by
the shareholders. The Plan is designed to satisfy the performance-
based exception to the Section 162(m) limitation on deductibility with
respect to incentive bonus compensation for named executive officers.
Moreover, the Company will likely take actions within the allowable
transition period to exempt the performance-based stock option plan
from the deductibility limitation.
Members of the Personnel Committee:
Jill K. Conway
Ralph DeNunzio, Chairman
John E. Jaqua
John R. Thompson, Jr.
PERFORMANCE GRAPH
The following graph demonstrates a five-year comparison of
cumulative total returns for NIKE's Class B Stock, the Standard & Poor's
500 Stock Index, and the Standard & Poor's Shoes and Apparel Indices. The
graph assumes an investment of $100 on May 31, 1990 in each of the Company'
Common Stock, and the stocks comprising the Standard & Poor's 500 Stock
Index and the Standard & Poor's Shoes and Apparel Indices. Each of the
indices assumes that all dividends were reinvested.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
NIKE, Inc. S&P 500 Index S&P Shoes Index S&P Apparel Index
<S> <C> <C> <C> <C>
1990 100 100 100 100
1991 102.53 111.79 116.47 129.79
1992 151.22 122.81 150.11 131.29
1993 190.79 137.06 184.09 129.35
1994 157.79 142.90 156.47 108.71
1995 213.78 171.75 181.64 111.19
</TABLE>
- ---------
The Standard & Poor's Shoe Index consists of NIKE, Reebok International,
Brown Group, Inc. and Stride Rite Corporation. The Standard & Poor's Apparel
Index consists of Liz Claiborne, Inc., Russell Corp., Fruit of the Loom,
Springs Industries, Inc. and VF Corp. The Standard & Poor's Shoe
and Apparel Indices include companies in each of two major lines of
business in which the Company competes. The indices do not encompass all
of the Company's competitors, nor all product categories and lines of
business in which the Company is engaged.
THE STOCK PERFORMANCE SHOWN ON THE GRAPH ABOVE IS NOT NECESSARILY
INDICATIVE OF FUTURE PERFORMANCE. THE COMPANY WILL NOT MAKE NOR ENDORSE ANY
PREDICTIONS AS TO FUTURE STOCK PERFORMANCE.
PERSONNEL COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Personnel Committee of the Board of Directors during
the fiscal year ended May 31, 1995, are listed above. The Committee is
composed solely of non-employee directors. Mr. Jaqua serves as Secretary of
the Company, but is not an employee. During the fiscal year, the Company
paid Harbor Point Associates, Inc., of which director Ralph D. DeNunzio is
President, $100,000 for financial consulting services, and paid director
John R. Thompson, Jr. $351,000 for services rendered pursuant to an
endorsement contract. The Company expects to pay Mr. DeNunzio, or his
firm, and Mr. Thompson for additional legal and consulting work that may
be performed by them for the Company during fiscal 1996.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
AND CHANGE-IN-CONTROL ARRANGEMENTS
An agreement between the Company and President and Chief Operating
Officer, Dr. Thomas E. Clarke, contains a covenant not to compete that
extends for one year following the termination of Dr. Clarke's employment
with the Company. The agreement provides that if Dr. Clarke voluntarily
resigns, the Company will make monthly payments to him during the one-year
noncompetition period in an amount equal to one-half of Dr. Clarke's last
monthly salary. The agreement provides further that if Dr. Clarke's
employment is terminated by the Company, the Company will make monthly
payments to him during the one-year noncompetition period in an amount
equal to Dr. Clarke's last monthly salary. The Company may unilaterally
waive the covenant not to compete. If the covenant is waived, the
Company will not be required to make the payments described above for
the months as to which the waiver applies.
The Company has a similar agreement with Vice President Mark G. Parker
that extends from one year following the termination of Mr. Parker's
employment with the Company. The agreement provides that if Mr. Parker
voluntarily resigns, the Company will make monthly payments to him
during the one-year noncompetition period in an amount equal to the
greater of (i) $20,833 or (ii) one-twenty-fourth of the total salary
and bonuses received by Mr. Parker durinng the 12-month period immediately
preceding his resignation. The agreement provides further that if Mr.
Parker's employment is terminated by the Company, the Company will
make monthly payments to him during the one-year noncompetition period
in an amount equal to the greater of $41,667 or (ii) one-twelfth of the
total salary and bonuses received by Mr. Parker during the 12-month
period immediately preceding his termination. If Mr. Parker is
terminated without cause, the parties may mutually agree to waive the
covenant not to compete, and if Mr. Parker is terminated for cause,
the Company may unilaterally waive the covenant. If the covenant is
waived, the Company will not be required to make the payments described
above for the months as to which the waiver applies.
CERTAIN TRANSACTIONS
During the fiscal year ended May 31, 1995, the Company paid the law
firm of Bullivant, Houser, Bailey, Pendergrass & Hoffman, of which
director Douglas G. Houser is a partner, approximately $61,219 for services
rendered. During the same period, the Company paid Harbor Point Associates,
Inc., of which director Ralph D. DeNunzio is President, $100,000 for
financial consulting services, paid Robanna, Inc., which is owned by
director John R. Thompson, Jr. $351,000 for services rendered
pursuant to an endorsement contract, and paid director Kenichi Ohmae
$45,000 for business and financial consulting services. The Company
expects to pay Mr. Houser, or his law firm, Mr. DeNunzio, or his
firm, Mr. Thompson and Mr. Ohmae for additional legal and consulting
services that may be performed by them for the Company during fiscal
year 1996.
INDEBTEDNESS OF MANAGEMENT
On July 19, 1994 the Company loaned $500,000 at 5.65% per annum to
President Thomas E. Clarke for the purchase of a second home. The
loan is secured by the second home, and must be repaid within 180 days
following termination of employment. As an inducement to remain employed
by the Company, the Company has agreed to forgive $100,000 of the loan
commencing January 1, 2000 and on each of the four anniversary dates
thereafter, provided that Dr. Clarke remains employed by the Company.
PROPOSAL 2
APPROVAL OF INCREASE IN AUTHORIZED COMMON STOCK
The Board of Directors recommends that shareholders of the Company
approve an amendment to Article IV of the Company's Restated Articles of
Incorporation, as amended, to increase the Company's authorized Class A
Stock from 60,000,000 to 110,000,000 shares and the authorized Class B
Stock from 150,000,000 shares to 330,000,000 shares.
The reason for this amendment is to permit the Company to effect one
or more stock splits by means of a stock dividend. The Company currently
does not have sufficient authorized Class B shares to effect a 2-for-1
stock split. The Board of Directors has not approved such a split, but
believes it to be desirable to have that flexibility.
The proposed increase in the Company's authorized Common Stock would
be large enough to permit the Board of Directors to effect additional stock
splits or stock dividends in the future if the Board determines at such
time that such action would be in the best interests of the Company.
While the proposed amendment is intended to facilitate such future stock
splits or stock dividends, such shares could also be used for other purposes
such as future financing and acquisitions of property, including stock or
assets of other businesses, if deemed desirable by the Board. Although the
Company considers potential acquisitions from time to time, the Board has
no present plans to use any of the authorized unissued shares of the Company
for such purpose. Additional shares could also be used to dilute the
stock ownership of persons seeking to obtain control of the Company.
however, the Company is not proposing this amendment for that purpose.
The additional shares of Common Stock for which authorization
is sought would be identical to the shares of Common Stock the Company
now has authorized. Holders of Common Stock do not have preemptive rights
to subscribe to additional securities which may be issued by the Company.
The Board of Directors considers this amendment advisable to permit a
stock split and to provide flexibility for future stock splits, stock
dividends and capital requirements. Approval of this amendment by the
shareholders at the Annual Meeting may avoid the expensive procedure of
calling and holding a special meeting of shareholders for such a purpose
at a later date.
Approval of Proposal 2 would require (i) the presence at the Annual
Meeting of a majority of the outstanding shares of Class A Stock and a
majority of the outstanding shares of Class B Stock, and (ii) that in each
such class the number of shares voting in favor of this Proposal exceeds
the number of shares voting against this Proposal. Abstentions and broker
non-votes are counted for purposes of determining whether a quorum exists
but are not counted as voting either for or against and therefore have no
effect on the results of the vote.
PROPOSAL 3
APPROVAL OF EXECUTIVE PERFORMANCE SHARING PLAN
In 1993, the Internal Revenue Code was amended to add Section 162(m),
which prevents a publicly held corporation from taking federal income tax
deductions previously allowed for compensation in excess of $1 million per
year paid to the named executive officers whose compensation is disclosed
in the corporation's proxy statement. The Code, however exempts
compensation that qualifies as "performance-based".
In view of the changes to the tax laws, the Board of Directors has
adopted, and proposed for approval by the shareholders, the Executive
Performance Sharing Plan (the "Plan"). The purpose of the Plan is to
satisfy Internal Revenue Code requirements for shareholder-approved,
performance-based compensation in order to preserve the Company's
income tax deduction for annual incentive bonus payments to the named
executive officers. The Plan is a continuation of the previously existing
incentive bonus program for corporate officers, and is similar to the
incentive bonus program for all employees of the Company. The following
summary of the Plan is qualified in its entirety by reference to the terms
of the Plan, a copy of which is attached as Exhibit A to this Proxy
Statement.
Persons Covered. The persons covered by the Plan are all corporate
officers of the Company. Under the Company's Bylaws, corporate officers
are those elected by the Board of Directors. The corporate officers
include nearly all of the Company's executive officers, a total of eight
persons. Other officers and employees of the Company will continue to be
eligible to receive annual cash incentive bonuses outside of the Plan.
Administration. Grants of target awards under the Plan and all
other decisions regarding the administration of the Plan will be made
by the Personnel Committee of the Board of Directors, or if the Personnel
Committee is not comprised solely of "outside directors" as that term
is defined in regulations under Section 162(m), another Board committee
consisting solely of outside directors (the "Committee").
Target Awards. Within 90 days of the beginning of each fiscal year
of the Company, the Committee will establish for each corporate officer
the performance target or targets and related target awards payable
in cash upon meeting the performance targets for the year. Performance
targets must be expressed as an objectively determinable level of
performance of the Company or any subsidiary, division or other unit of
the Company, based on one or more of the following: net income, net
income before taxes, operating income, revenues, return on sales,
return on equity, earnings per share, total shareholder return, or any
of the foregoing before the effect of acquisitions, divestitures, accounting
changes, restructuring, or other special charges, as determined by the
Committee at the time of establishing the performance target. The
maximum target award for a corporate officer in any year will be the lesser
of 150% of the officer's base salary established at the beginning of the
year, or $2 million.
Determination of Award Payouts. At the end of each fiscal year,
the Committee will certify the attainment of the performance targets
and the calculation of the payouts of the related target awards. No
award shall be paid if the related performance target is not met, but
the Committee may, in its discretion, reduce or eliminate an officer's
calculated award based on circumstances relating to the performance of
the Company or the officer.
Effective Date. If approved by shareholders, the Plan will be
effective as of June 1, 1995.
Amendment and Termination. The Plan may be amended by the Committee,
with the approval of the Board of Directors, at any time except to the
extent that shareholder approval would be required to maintain the
qualification of Plan awards as performance-based compensation. Unless
reapproved by the shareholders, the Plan will terminate at the first
meeting of shareholders of the Company in the year 2000.
1996 Target Awards. In June 1995, the Committee established
performance targets and target awards under the Plan for the corporate
officers for fiscal 1996. As in prior years under the Company's previously
existing annual incentive bonus program, target awards for fiscal 1996
are based on the achievement of pre-established target levels of net
income before taxes. The actual amounts to be paid under those awards
cannot be determined at this time, as such amounts are dependent upon
the Company's performance for the current fiscal year. However, since
the Plan is a continuation of the previously existing annual incentive
bonus program, shareholders may assume that if the Plan had been in effect
for fiscal 1995, the actual bonus compensation received by the Named
Officers as shown in the Summary Compensation Table on page ------ would
have been received under the Plan. All corporate officers as a group,
including the Named officers, received bonus compensation for fiscal
1995 of $2,551,875.
Board Recommendation. the Board of Directors recommends that
shareholders vote for approval of the Plan. Holders of Class A Stock
and Class B Stock will vote together as a single class on Proposal 3.
If a quorum is percent at the Annual Meeting, Proposal 3 will be approved
if the number of shares voted in favor of the proposal exceeds the
number of shares voting against the proposal. Abstentions and broker
non-votes are counted for purposes of determining whether a quorum
exists, but are not counted as voting either for or against and
therefore have no effect on the results of the vote.
PROPOSAL 4
RATIFICATION OF INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company, upon recommendation of its
Audit Committee, has appointed Price Waterhouse as independent
accountants to examine the Company's consolidated financial statements
for the fiscal year May 31, 1996 and to render other professional services
as required.
The appointment of Price Waterhouse is being submitted to shareholders
for ratification.
Price Waterhouse has served as independent accountants to the Company
since 1971. Representatives of Price Waterhouse will be present at the
Annual Meeting and are expected to be available to respond to questions.
SHAREHOLDER PROPOSALS
A proposal by a shareholder for inclusion in the Company's proxy
statement and form of proxy for the 1996 annual meeting of shareholders
must be received by NIKE at One Bowerman Drive, Beaverton, Oregon
97005-6453, Attention: Lindsay D. Stewart, Assistant Secretary, on or
before April 9, 1996 in order to be eligible for such inclusion.
OTHER MATTERS
As of the time this proxy statement was printed, management was
unaware of any proposals to be presented for consideration at the Annual
Meeting other than those set forth herein, but if other matters do properly
come before the Annual Meeting, the persons named in the proxy will vote
the shares represented by such proxy according to their best judgment. The
Company's bylaws prescribe that a shareholder may bring matters before an
annual meeting only if such shareholder has given the Company advance
written notice of such matters. For purposes of the 1995 Annual Meeting,
such notice must be received on or before August 18, 1995 by Lindsay D.
Stewart, Assistant Secretary of the Company, at One Bowerman
Drive, Beaverton, Oregon 97005-6453.
A COPY OF NIKE'S 1995 ANNUAL REPORT ON FORM 10-K WILL BE
AVAILABLE TO SHAREHOLDERS WITHOUT CHARGE UPON REQUEST TO: INVESTOR
RELATIONS, NIKE, INC., ONE BOWERMAN DRIVE, BEAVERTON, OREGON 97005-6453.
For the Board of Directors
JOHN E. JAQUA
SECRETARY
EXHIBIT A
NIKE, Inc.
EXECUTIVE PERFORMANCE SHARING PLAN
This is the Executive Performance Sharing Plan of NIKE, Inc. for
the payment of incentive compensation to designated employees.
Section 1. Definitions. The following terms have the following meanings:
Board: The Board of Directors of the Company.
Code: The Internal Revenue Code of 1986, as amended.
Committee: The Personnel Committee of the Board, provided however, if
the Personnel Committee of the Board is not composed entirely of Outside
Directors, the "Committee" shall mean a committee composed entirely of at
least two Outside Directors appointed by the Board from time to time.
Company: NIKE, Inc.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Outside Directors: The meaning ascribed to this term in Section 162(m)
of the Code and the regulations proposed or adopted thereunder.
Performance Target: An objectively determinable level of performance as
selected by the Committee to measure performance of the Company or any
subsidiary, division, or other unit of the Company for the Year based on
one or more of the following: net income, net income before taxes,
operating income, revenues, return on sales, return on equity, earnings
per share, total shareholder return, or any of the foregoing before the
effect of acquisitions, divestitures, accounting changes, restructuring,
or other special charges, as determined by the Committee at the time of
establishing a Performance Target.
Plan: The Executive Performance Sharing Plan of the Company.
Target Award: An amount of cash compensation to be paid to a Plan
participant based on achievement of a particular Performance Target
level established by the Committee, expressed as a percentage of the
participant's base salary at the beginning of the Year, determined in
accordance with guidelines established by the Committee.
Year: The fiscal year of the Company.
Section 2. Objectives. The objectives of the Plan are to:
(a) recognize and reward on an annual basis the Company's
corporate officers for their contributions to the overall profitability
and performance of the Company; and
(b) qualify compensation under the Plan as "performance-based
compensation" within the meaning of Section 162(m) of the Code and the
regulations promulgated thereunder.
Section 3. Administration. The Plan will be administered by the
Committee. Subject to the provisions of the Plan, the Committee will have
full authority to interpret the Plan, to establish and amend rules and
regulations relating to it, to determine the terms and provisions for
making awards and to make all other determinations necessary or advisable
for the administration of the Plan.
Section 4. Participation. Participation in the Plan shall be
limited to individuals who are corporate officers of the Company.
Section 5. Determination of the Performance Targets and Awards.
The Committee shall determine, in its sole discretion, the Performance
Targets and Target Award opportunities for each participant, within 90
days of the beginning of each Year. The Committee may establish
(i) several Performance Target levels for each participant, each
corresponding to a different Target Award opportunity, and (ii) different
Performance Targets and Target Award opportunities for each participant
in the Plan. The maximum Target Award opportunity under the Plan for a
participant in any Year shall be the lesser of 150% of the participant's
base salary established at the beginning of the Year, or $2 million. For
competitive reasons, the specific Performance Targets determined by the
Committee will not be publicly disclosed.
Section 6. Determination of Plan Awards. At the conclusion of the
Year, in accordance with Section 162(m)(4)(C)(iii) of the Code, prior to
the payment of any award under the Plan, the Committee shall certify in
the Committee's internal meeting minutes the attainment of the Performance
Targets for the Year and the calculation of the awards. No award shall
be paid if the related Performance Target is not met. In no event shall
an award to any participant exceed the lesser of 150% of the participant's
base salary, or $2 million. The Committee may, in its sole discretion,
reduce or eliminate any participant's calculated award based on
circumstances relating to the performance of the Company or the
participant. Awards will be paid in cash as soon as practicable
following the Committee's certification of the awards.
Section 7. Termination of Employment. The terms of a Target Award
may provide that in the event of a participant's termination of employment
for any reason during a Year, the participant (or his or her beneficiary)
will receive, at the time provided in Section 6, all or any portion of the
award to which the participant would otherwise have been entitled.
Section 8. Miscellaneous.
(a) Amendment and Termination of the Plan. The Committee with the
approval of the Board may amend, modify or terminate the Plan at any time
and from time to time except insofar as approval by the Company's
shareholders is required pursuant to Section 162(m)(4)(C)(ii) of the Code.
The Plan shall terminate at the first shareholder meeting that occurs in
the fifth year after the Company's shareholders approve the Plan.
Notwithstanding the foregoing, no such amendment, modification or
termination shall affect the payment of Target Awards previously established.
(b) No Assignment. Except as otherwise required by applicable
law, no interest, benefit, payment, claim or right of any participant
under the plan shall be subject in any manner to any claims of any creditor
of any participant or beneficiary, nor to alienation by anticipation, sale,
transfer, assignment, bankruptcy, pledge, attachment, charge or encumbrance
of any kind, and any attempt to take any such action shall be null and void.
(c) No Rights to Employment. Nothing contained in the Plan shall
give any person the right to be retained in the employment of the Company
or any of its subsidiaries. The Company reserves the right to terminate a
participant at any time for any reason notwithstanding the existence of the
Plan.
(d) Beneficiary Designation. The Committee shall establish such
procedures as it deems necessary for a participant to designate a
beneficiary to whom any amounts would be payable in the event of a
participant's death.
(e) Plan Unfunded. The entire cost of the Plan shall be paid
from the general assets of the Company. The rights of any person to
receive benefits under the Plan shall be only those of a general
unsecured creditor, and neither the Company nor the Board nor the Committee
shall be responsible for the adequacy of the general assets of the Company
to meet and discharge Plan liabilities, nor shall the Company be required
to reserve or otherwise set aside funds for the payment of its obligations
hereunder.
(f) Applicable Law. The Plan and all rights thereunder shall be
governed by and construed in accordance with the laws of the State of
Oregon.
NOTICE OF ANNUAL
MEETING
AND
PROXY STATEMENT
---------
SEPTEMBER 18, 1995
BEAVERTON, OREGON
---------
[LOGO]
[LOGO]
This proxy statement is printed on recycled paper
PROXY
NIKE, INC.
CLASS A COMMON STOCK PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE 1995 MEETING OF SHAREHOLDERS -- SEPTEMBER 18, 1995
The undersigned hereby appoints Philip H. Knight, Thomas E. Clarke and
Douglas G. Houser, and each of them, proxies with full power of
substitution, to vote, as designated below, on behalf of the undersigned
all shares of Class A Common Stock which the undersigned may be entitled
to vote at the Annual Meeting of Shareholders of NIKE, Inc. on September 18,
1995, and any adjournments thereof, with all powers that the undersigned
would possess if personally present. A majority of the proxies or
substitutes present at the meeting may exercise all powers granted hereby.
(change of address/comments)
Election of Directors, Nominees:
____________________________
Ralph D. DeNunzio; Richard K. Donahue;
Douglas G. Houser; John E. Jaqua; ____________________________
Philip H. Knight; Kenichi Ohmae;
Ralph A. Pfeiffer, Jr.; Charles W. Robinson; ____________________________
Michael Spence; John R. Thompson, Jr.
You are encouraged to specify your choices by marking the appropriate
boxes, SEE REVERSE SIDE, but you need not mark any boxes if you wish to
vote in accordance with the Board of Directors' recommendations. The
proxies cannot vote your shares unless you sign and return this card.
------------------
|See Reverse side|
------------------
- ----- Please mark your 9317
| X | votes as in this
- ----- example.
The shares represented by this proxy will be voted as specified, but if no
specification is made, this proxy will be voted FOR the election of the
nominees for director and FOR approval of Proposals 2, 3 and 4. The
proxies may vote in their discretion as to other matters which may come
before the meeting.
1. Election of Directors For Withheld
(see reverse) ----- -----
| | | |
----- -----
For, except vote withheld from the following nominees:
______________________________________________________
2. Proposal to amend the Articles of For Withheld
Incorporation to increase the ----- -----
number of authorized shares. | | | |
----- -----
3. Proposal to approve the For Withheld
Executive Performance Sharing Plan ----- -----
| | | |
----- -----
4. Proposal to ratify the For Against Abstain
appointment of Price ----- ----- -----
Waterhouse as | | | | | |
independent accountants. ----- ----- -----
SIGNATURE(S)_____________________________ Date___________________
(Please date and sign above exactly as your name or names appear
hereon. Joint owners should each sign personally. Corporate proxies
should be signed in full corporate name by an authorized officer and
attested. Persons signing in a fiduciary capacity should indicate
their full titles in such capacity.)
PROXY
NIKE, INC.
CLASS B COMMON STOCK PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE 1995 MEETING OF SHAREHOLDERS - September 18, 1995
The undersigned hereby appoints Philip H. Knight, Thomas E. Clarke and
Douglas G. Houser, and each of them, proxies with full power of
substitution, to vote, as designated below, on behalf of the undersigned
all shares of Class B Common Stock which the undersigned may be entitled
to vote at the Annual Meeting of Shareholders of NIKE, Inc. on September 18,
1995, and any adjournments thereof, with all powers that the undersigned
would possess if personally present. A majority of the proxies or
substitutes present at the meeting may exercise all powers granted hereby.
(change of address/comments)
Election of Directors, Nominees:
---------------------------------
William J. Bowerman
Thomas E. Clarke ---------------------------------
Jill K. Conway
Delbert J. Hayes ---------------------------------
---------------------------------
YOU ARE ENCOURAGED TO SPECIFY YOUR CHOICES BY MARKING THE APPROPRIATE
BOXES, SEE REVERSE SIDE, BUT YOU NEED NOT MARK ANY BOXES IF -------------
YOU WISH TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' |SEE REVERSE|
RECOMMENDATIONS. THE PROXIES CANNOT VOTE YOUR SHARES | SIDE |
UNLESS YOU SIGN AND RETURN THIS CARD. -------------
<PAGE>
- ----- Please mark your 9316
| X | votes as in this
- ----- example.
The shares represented by this proxy will be voted as specified, but if no
specification is made, this proxy will be voted FOR the election of the
nominees for director and FOR approval of Proposals 2, 3 and 4. The proxies
may vote in their discretion as to other matters which may come before the
meeting.
FOR WITHHELD
1. Election of Directors ----- -----
(see reverse side) | | | |
----- ----
For, except vote withheld from the following nominee(s):
- ---------------------------------------------------------
2. Proposal to amend the Articles of For Withheld
Incorporation to increase the ----- -----
number of authorized shares. | | | |
----- -----
3. Proposal to approve the For Withheld
Executive Performance Sharing Plan ----- -----
| | | |
----- -----
FOR AGAINST ABSTAIN
4 Proposal to ratify the appointment of ----- ----- -----
Price Waterhouse as independent | | | | | |
accountants. ----- ----- -----
SIGNATURE(S)_____________________________________ DATE____________
(Please date and sign above exactly as your name or names appear hereon.
Joint owners should each sign personally. Corporate proxies should be
signed in full corporate name by an authorized officer and attested.
Persons signing in a fiduciary capacity should indicate their full title
in such capacity.)
