<PAGE>
Filed Pursuant to Rule 424(b)(2)
File No. 333-15953
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED NOVEMBER 29, 1996
$200,000,000
LOGO NIKE, INC.
6 3/8% NOTES DUE DECEMBER 1, 2003
----------------
Interest on the Notes is payable on June 1 and December 1 of each year,
commencing June 1, 1997. The Notes are redeemable, in whole or in part, at the
option of the Company at any time at the redemption prices described herein.
See "Description of the Notes--Optional Redemption".
The Notes will be represented by one or more global Notes registered in the
name of the nominee of The Depository Trust Company. Beneficial interests in
the global Notes will be shown on, and transfers thereof will be effected only
through, records maintained by DTC and its participants. Except as described
herein, Notes in definitive form will not be issued. The Notes will be issued
only in registered form in denominations of $1,000 and integral multiples
thereof. See "Description of the Notes".
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
----------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
----------------- ------------ -------------
<S> <C> <C> <C>
Per Note........................... 99.575% 0.625% 98.950%
Total.............................. $199,150,000 $1,250,000 $197,900,000
</TABLE>
- --------
(1) Plus accrued interest from December 1, 1996.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $240,000 payable by the Company.
----------------
The Notes offered hereby are offered severally by the Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that the
Notes will be ready for delivery in book-entry form only through the
facilities of DTC in New York, New York, on or about December 13, 1996,
against payment therefor in immediately available funds.
The activities of the Underwriters in connection with the offering made
hereby are led jointly by Goldman, Sachs & Co. and Salomon Brothers Inc.
GOLDMAN, SACHS & CO. SALOMON BROTHERS INC
LEHMAN BROTHERS INC. MERRILL LYNCH & CO.
----------------
The date of this Prospectus Supplement is December 10, 1996.
<PAGE>
----------------
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
<PAGE>
THE COMPANY
The principal business activity of NIKE, Inc. ("NIKE" or the "Company")
involves the design, development and worldwide marketing of high quality
footwear, apparel and accessory products. NIKE sells its products to
approximately 18,000 retail accounts in the United States and through a mix of
independent distributors, licensees and subsidiaries in approximately 110
countries around the world. Virtually all of NIKE's products are manufactured
by independent contractors. Most footwear products are produced outside the
United States, while apparel products are produced both in the United States
and abroad. As of August 31, 1996 the Company's worldwide futures orders for
athletic footwear and apparel scheduled for delivery between September 1996
and January 1997 totaled $3.5 billion, 66 percent higher than such orders for
the same period last year.
PRODUCTS
NIKE is the largest supplier of athletic footwear in the world. NIKE's
athletic footwear products are designed primarily for specific athletic use,
although a large percentage of the products are worn for casual or leisure
purposes. The Company places considerable emphasis on high quality
construction and innovative design. Basketball, cross-training, running and
children's shoes are currently the top-selling product categories and are
expected to continue to lead in product sales in the near future. However, the
Company also markets shoes designed for outdoor activities, tennis, golf,
soccer, baseball, football, bicycling, volleyball, wrestling, cheerleading,
aquatic activities and other athletic and recreational uses.
The Company sells active sports apparel covering each of the above
categories, as well as athletic bags and accessory items. NIKE apparel and
accessories are designed to complement the Company's athletic footwear
products, feature the same trademarks and are sold through the same marketing
and distribution channels. The Company often markets footwear, apparel and
accessories in "collections" of similar design or for specific purposes.
The Company sells a line of dress and casual footwear and accessories for
men, women and children under the brand name Cole Haan(R). The Company markets
a line of headwear with licensed team logos under the brand name "Sports
Specialties". The Company also sells small amounts of various plastic products
to other manufacturers through its wholly-owned subsidiary, Tetra Plastics,
Inc.
In February 1995 the Company acquired Bauer Inc., formerly Canstar Sports
Inc., the world's largest hockey equipment manufacturer. Bauer manufactures
and distributes ice skates, skate blades, in-line roller skates, protective
gear, hockey sticks and hockey jerseys and accessories under the Bauer(R)
brand name. Bauer also offers a full selection of products for street, roller
and field hockey.
S-3
<PAGE>
The Company experienced revenue growth in all breakout categories in fiscal
1996 and in all breakout categories except for "other brands" in the first
quarter of fiscal 1997 as shown in the following table, which sets forth
information regarding the Company's United States and international revenues
for fiscal 1994, 1995 and 1996 and the first quarter of fiscal 1997, as well
as the percentage change from the prior period:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
FISCAL YEAR ENDED MAY 31, AUGUST 31,
--------------------------------------------------- -------------------
1994 % CHG 1995 % CHG 1996 % CHG 1996 % CHG(1)
---------- ----- ---------- ----- ---------- ----- ---------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
United States footwear.. $1,868,900 (5)% $2,309,400 24% $2,772,500 20% $1,002,103 27%
United States apparel... 338,500 (6) 423,900 25 842,500 99 352,385 93
---------- ---------- ---------- ----------
Total United States.... 2,207,400 (5) 2,733,300 24 3,615,000 32 1,354,488 39
---------- ---------- ---------- ----------
International footwear.. 996,200 (5) 1,244,300 25 1,682,300 35 548,538 28
International apparel... 358,800 2 472,700 32 651,400 38 232,339 54
---------- ---------- ---------- ----------
Total International.... 1,357,000 (3) 1,717,000 27 2,333,700 36 780,877 35
Other brands............ 225,300 13 310,600 38 521,900 68 146,561 (1)
---------- ---------- ---------- ----------
Total NIKE............. $3,789,700 (4)% $4,760,900 26% $6,470,600 36% 2,281,926 34%
========== ========== ========== ==========
</TABLE>
- --------
(1) Prior to fiscal year 1997, certain of the Company's international
operations reported their results of operations on a one month lag which
allowed more time to compile results. The Company has taken steps to
improve its international reporting procedures that has allowed for more
timely reporting of these operations. Beginning in the first quarter of
fiscal year 1997, the one month lag was eliminated. The change affected
the quarterly reporting periods for these operations. Therefore, for
purposes of calculating the percentage change in the three months ended
August 31, 1996 compared to the three months ended August 31, 1995,
results for the three months ended August 31, 1995 have been adjusted to
reflect the elimination of the one month lag.
UNITED STATES MARKET
During fiscal 1996, sales to the Company's approximately 18,000 retail
accounts in the United States accounted for approximately 61 percent of total
revenues. The domestic retail account base includes a mix of department
stores, footwear stores, sporting goods stores, skating, tennis and golf
shops, and other retail accounts.
NIKE makes substantial use of its innovative "futures" ordering program,
which allows retailers to order five to six months in advance of delivery with
the guarantee that 90 percent of their orders will be delivered within a set
time period at a fixed price. In fiscal year 1996, 88 percent of the Company's
domestic footwear shipments (excluding Cole Haan(R) and Bauer(R)) were made
under the futures program compared to 88 percent in fiscal 1995 and 81 percent
in fiscal 1994. The Company is implementing a similar futures program for
apparel.
The Company utilizes 18 NIKE sales offices for the solicitation of sales in
the United States. The Company also utilizes 10 independent sales
representatives for the sale of specialty products, such as golf, cycling,
water sports and outdoor wear. In addition, the Company operates 78 wholly-
owned retail outlets, 33 of which carry primarily B-grade and close-out
merchandise, 31 of which are Cole Haan(R) stores, five of which are high-
profile NIKETOWN stores designed to showcase the Company's products, and five
of which are employee-only stores.
INTERNATIONAL MARKETS
The Company currently markets its products in approximately 110 countries
outside of the United States through independent distributors, licensees,
subsidiaries and branch offices. NIKE operates 28 distribution centers in
Europe, Asia, Canada, Latin America and Australia, and also distributes
through independent distributors and licensees. The Company estimates that its
products are sold through approximately 34,000 retail accounts outside the
United States. International sales accounted for 39
S-4
<PAGE>
percent of total revenues in fiscal 1996, compared to 37 percent in fiscal
1995 and 36 percent in fiscal 1994. The Company has a futures ordering program
for European retailers similar to the United States futures program described
above. The Company operates 12 wholly-owned retail outlets outside the United
States, two of which are employee-only stores.
PRODUCT RESEARCH AND DEVELOPMENT
The Company believes that its research and development efforts are a key
factor in its past and future success. Technical innovation in the design of
footwear, apparel and athletic equipment receive
continued emphasis as NIKE strives to produce products that reduce or
eliminate injury, aid athletic performance and maximize comfort.
In addition to its own staff of specialists in the areas of biomechanics,
exercise physiology, engineering, industrial design and related fields, NIKE
also utilizes research committees and advisory boards made up of athletes,
coaches, trainers, equipment managers, orthopedists, podiatrists and other
experts who consult with the Company and review designs, materials and
concepts for product improvement. Employee athletes wear-test and evaluate
products during the design and development process.
In fiscal 1996, NIKE spent approximately $46.8 million on product research,
development and evaluation, compared to $28.8 million in 1995 and $24.6
million in 1994.
MANUFACTURING
In fiscal 1996, approximately 56 percent of the Company's total apparel
production for sale to the United States market was manufactured in the United
States by independent contract manufacturers, most of which are located in the
southern states. The remainder was manufactured by independent contractors in
Asia and South America, most of which are located in Bangladesh, Hong Kong,
Indonesia, Malaysia, The Philippines, Singapore, Sri Lanka, Taiwan and
Thailand. Substantially all of NIKE's apparel production for sale to the
international market was manufactured outside the United States. Virtually all
of the Company's footwear (exclusive of Cole Haan(R)) is produced outside of
the United States.
The principal materials used in the Company's footwear products are natural
and synthetic rubber, vinyl and plastic compounds, foam cushioning materials,
nylon, leather, canvas, and a polyurethane film used to make AIR-SOLE(R)
cushioning components. NIKE and its contractors and suppliers buy raw
materials in bulk. Most raw materials are available in the countries where
manufacturing takes place. NIKE has thus far experienced little difficulty in
satisfying its raw material requirements.
USE OF PROCEEDS
NIKE intends to use the net proceeds from the sale of the Notes (estimated
to be $197.7 million) for general corporate purposes including, without
limitation, refinancing, in part, short-term debt. Short-term debt outstanding
as of August 31, 1996 was $775.2 million bearing interest at a weighted
average interest rate of approximately 6.0%.
S-5
<PAGE>
RECENT SELECTED FINANCIAL DATA
The recent selected financial data shown below for, and as of the end of,
the three-month periods ended August 31, 1995 and August 31, 1996 are derived
from unaudited financial statements and, in the opinion of management, include
all adjustments (consisting only of normal recurring accruals) necessary to
present fairly the data for such periods. The recent selected financial data
should be read in conjunction with the more detailed information appearing in
the Company's Annual Report on Form 10-K for the fiscal year ended May 31,
1996 (as amended by its form 10-K/A, dated August 29, 1996), as restated by
the Company's Current Report on Form 8-K dated September 16, 1996, and the
other documents available as described under "Incorporation of Certain
Documents by Reference" in the accompanying Prospectus.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
AUGUST 31,
----------------------
1995(1) 1996
---------- ----------
(DOLLARS IN
THOUSANDS)
<S> <C> <C>
STATEMENT OF INCOME DATA:
Revenues......................................... $1,700,020 $2,281,926
Gross margin..................................... 686,641 919,807
Gross margin as a percentage of Revenues......... 40.4% 40.3%
Selling, general and administrative expenses..... 369,043 529,537
Selling, general and administrative expenses as a
percentage of Revenues.......................... 21.7% 23.2%
Net income....................................... 182,098 226,063
BALANCE SHEET DATA (PERIOD END):
Cash and equivalents............................. 178,556 398,098
Inventories...................................... 676,417 909,414
Working capital.................................. 1,057,857 1,516,698
Total assets..................................... 3,323,416 4,425,828
Short-term debt(2)............................... 509,293 775,225
Long-term debt................................... 14,082 107,247
Common shareholders' equity...................... 2,102,891 2,656,948
OTHER DATA:
Cash flow from operations........................ 123,139 21,413
Ratio of earnings to fixed charges(3)............ 19.96 21.58
GEOGRAPHIC REVENUES:
United States.................................... 1,121,937 1,501,049
Europe........................................... 353,707 456,250
Asia/Pacific..................................... 145,728 218,110
Canada, Latin America and other.................. 78,648 106,517
---------- ----------
Total Revenues................................... $1,700,020 $2,281,926
========== ==========
</TABLE>
- --------
(1) Prior to fiscal year 1997, certain of the Company's international
operations reported their results of operations on a one month lag which
allowed more time to compile results. The Company has taken steps to
improve its international reporting procedures that has allowed for more
timely reporting of these operations. Beginning in the first quarter of
fiscal year 1997, the one month lag was eliminated. The change affected
the quarterly reporting periods for these operations. Therefore, results
for the three months ended August 31, 1995 have been adjusted to reflect
the elimination of the one month lag.
(2) Short-term debt consists of current portion of long-term debt, notes
payable and interest-bearing accounts payable.
(3) In accordance with the rules and regulations of the Commission, for
purposes of computing the ratios of earnings to fixed charges, earnings
represent income from operations before fixed charges and taxes, and fixed
charges represent interest on indebtedness, amortization of debt discount
and a share of rental expense which is deemed to be representative of the
interest factor.
S-6
<PAGE>
DESCRIPTION OF THE NOTES
The following information concerning the 6 3/8% Notes Due December 1, 2003
(the "Notes") offered hereby supplements and should be read in conjunction
with the statements in the accompanying Prospectus under the caption
"Description of Debt Securities." Capitalized terms not otherwise defined
herein shall have the meanings given to them in the accompanying Prospectus.
GENERAL
The Notes will be issued as a series of Debt Securities under the Indenture
dated as of December 13, 1996 (the "Indenture"), between the Company and The
First National Bank of Chicago, as Trustee, which is more fully described in
the accompanying Prospectus.
The Notes will be issued as unsecured obligations of the Company in an
aggregate principal amount of $200,000,000 and will mature on December 1,
2003.
The Notes will bear interest from December 1, 1996, payable semi-annually in
arrears on each June 1 and December 1, commencing June 1, 1997, at the rate
set forth on the cover page of this Prospectus Supplement, to the persons in
whose names the Notes are registered on the preceding May 15 and November 15,
respectively.
The principal of and interest and premium (if any) on the Notes will be
payable, the transfer of Notes will be registrable and the Notes may be
presented for exchange, at the office of the Trustee located at One First
National Plaza, Suite 0126, Chicago, Illinois 60670-0126, attention: Corporate
Trust Services Division, or at the offices of the affiliate of the Trustee in
New York City, First Chicago Trust Company of New York, 14 Wall Street, 8th
Floor, New York, New York 10005. So long as the Notes are represented by a
Global Debt Security, the interest payable on the Notes will be paid to Cede &
Co., the nominee of the Depository, or its registered assigns as the
registered owner of the Global Debt Security, by wire transfer of immediately
available funds on each of the applicable interest payment dates, not later
than 2:30 p.m. Eastern Standard Time. If the Notes are no longer represented
by a Global Debt Security, payment of interest may, at the option of the
Company, be made by check mailed to the address of the Person entitled
thereto. No service charge will be made for any transfer or exchange of Notes,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
No sinking fund is provided for the Notes.
OPTIONAL REDEMPTION
The Notes will be redeemable, in whole or in part, at the option of the
Company at any time at a redemption price equal to the greater of (i) 100% of
the principal amount of such Notes or (ii) the sum of the present values of
the remaining scheduled payments of principal and interest thereon discounted
to the redemption date on a semiannual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate (determined
on the third Business Day preceding such redemption date), plus, in each case,
accrued and unpaid interest thereon to the redemption date.
"Adjusted Treasury Rate" means the arithmetic mean of the yields under the
heading "Week Ending" published in the Statistical Release most recently
published prior to the date of determination under the caption "Treasury
Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the redemption date, of
the principal being redeemed. If no maturity set forth under such heading
exactly corresponds to the maturity of such principal, yields for the two
published maturities most closely corresponding to the maturity of such
principal shall be calculated pursuant to the immediately preceding sentence,
and the Adjusted Treasury Rate shall be interpolated or extrapolated from such
yields on a straight-line basis, rounding in each of the relevant periods to
the nearest month.
S-7
<PAGE>
"Statistical Release" means the statistical release designated "H.15(519)"
or any successor publication which is published weekly by the Federal Reserve
System and which establishes yields on actively-traded United States
government securities adjusted to constant maturities, or, if such statistical
release is not published at the time of any determination under the terms of
the Notes, then such other reasonably comparable index which shall be
designated by NIKE.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of the Notes to be redeemed.
Unless the Company defaults in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Notes or portions
thereof called for redemption.
BOOK-ENTRY, DELIVERY AND FORM
The Notes will be represented by a Global Debt Security that will be
deposited with, or on behalf of, the Depository and registered in the name of
Cede & Co., the nominee of the Depository.
The Depository has advised the Company and the Underwriters as follows: The
Depository is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. The Depository was created to hold securities of its
participating organizations ("participants") and to facilitate the clearance
and settlement of securities transactions, such as transfers and pledges,
among its participants in such securities through electronic computerized
book-entry changes in accounts of the participants, thereby eliminating the
need for physical movement of securities certificates. Participants include
securities brokers and dealers (including the Underwriters), banks, trust
companies, clearing corporations and certain other organizations, some of whom
(and/or their representatives) own the Depository. Access to the Depository's
book-entry system is also available to others, such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship
with a participant, either directly or indirectly. Persons who are not
participants may beneficially own securities held by the Depository only
through participants.
Unless and until it is exchanged in whole or in part for Certificated Debt
Securities, in definitive form, the Global Debt Security may not be
transferred except as a whole by the Depository to a nominee of the Depository
or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor depository
or a nominee of such successor depository.
A further description of the Depository's procedures with respect to the
Notes is set forth in the accompanying Prospectus under the heading
"Description of Debt Securities--Payment of Interest and Exchange--Global Debt
Securities and Book-Entry System".
S-8
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Pricing Agreement and
the accompanying Underwriting Agreement Terms and Conditions (collectively,
the "Underwriting Agreement"), the Company has agreed to sell to each of the
Underwriters named below, and each of such Underwriters has severally agreed
to purchase, the principal amount of the Notes set forth opposite its name
below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
UNDERWRITER OF NOTES
----------- ------------
<S> <C>
Goldman, Sachs & Co. .......................................... $ 60,000,000
Salomon Brothers Inc .......................................... 60,000,000
Lehman Brothers Inc. .......................................... 40,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.......................................... 40,000,000
------------
Total...................................................... $200,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all of the Notes, if any are
taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement and in part to certain securities dealers at such price
less a concession of .375% of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to
exceed .250% of the principal amount of the Notes to certain brokers and
dealers. After the Notes are released for sale to the public, the offering
price and other selling terms may from time to time be varied by the
Underwriters.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that the Underwriters intend
to make a market in the Notes but are not obligated to do so and may
discontinue market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Notes.
In the ordinary course of their respective businesses, certain of the
Underwriters and their affiliates engage and may in the future engage in
investment banking activities with the Company and its subsidiaries.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
VALIDITY OF THE NOTES
The validity of the Notes offered hereby will be passed upon for NIKE by
Latham & Watkins, San Francisco, California, and by Paul J. Kelly, Jr., Esq.,
General Counsel of NIKE, and for the Underwriters by Sullivan & Cromwell, Los
Angeles, California.
S-9
<PAGE>
$500,000,000
LOGO
NIKE, INC.
DEBT SECURITIES
----------------
NIKE, Inc. ("NIKE" or the "Company") may offer from time to time its debt
securities in one or more series (the "Debt Securities") at an aggregate
initial offering price not to exceed $500,000,000 or its equivalent in another
currency or composite currency. Unless otherwise specified in one or more
supplements (a "Prospectus Supplement") to this Prospectus, the Debt
Securities will be direct, unsecured obligations of NIKE and will rank equally
with all other unsecured, unsubordinated indebtedness of NIKE.
The Debt Securities will be offered to the public on terms determined by
market conditions at the time of sale. The Debt Securities may be offered to
the public as separate series and may be offered in amounts, at prices and on
terms to be determined at the time of sale and to be set forth in one or more
Prospectus Supplements. The specific terms of the Debt Securities in respect
of which this Prospectus is being delivered, including, where applicable,
aggregate principal amount, maturity (which may be fixed or extendible),
interest rate or rates (which may be fixed or variable), if any, the time of
payment of interest, if any, authorized denominations (which may be in United
States dollars, in any other currency or in a composite currency), initial
public offering price, purchase price, any terms for a sinking fund or for
redemption at the option of NIKE or the holder, any listing on a securities
exchange and other terms with respect to such Debt Securities, will be set
forth in a Prospectus Supplement and/or a related Pricing Supplement which
will be delivered with this Prospectus. Debt Securities may be issued as
Discount Securities to be sold at a discount below their principal amount and,
if issued, certain terms thereof will be set forth in the Prospectus
Supplement related thereto. See "Description of Debt Securities".
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMIS-
SION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS OR
ANY SUPPLEMENT HERETO. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------
The Debt Securities may be offered directly to purchasers or to or through
underwriters, dealers or agents. If an agent of NIKE or a broker-dealer or
underwriter is involved in the sale of the Debt Securities in respect of which
this Prospectus is being delivered, the names of such agent, broker-dealer or
underwriter and the agent's commission or broker-dealer's or underwriter's
discount will be set forth in the Prospectus Supplement. The proceeds to NIKE
will be the purchase price in the case of sale through an agent or a broker-
dealer and the public offering price in the case of sale through an
underwriter. Net proceeds to NIKE will be the purchase price less commission
in the case of an agent and the public offering price less discount in the
case of an underwriter, less, in each case, other issuance expenses. See "Plan
of Distribution".
The date of this Prospectus is November 29, 1996.
<PAGE>
AVAILABLE INFORMATION
NIKE is subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance therewith
files reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information may be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C., and at the Commission's regional offices at Seven World
Trade Center, Suite 1300, New York, New York and at Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois, and copies may be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549.
Such reports, proxy statements and other information may also be inspected and
copied at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York and at the offices of the Pacific Stock Exchange, 301 Pine
Street, San Francisco, California. The Commission also maintains a site on the
World Wide Web at "http://www.sec.gov" that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission.
NIKE has filed with the Commission a Registration Statement on Form S-3 (the
"Registration Statement") under the Securities Act of 1933 (the "Securities
Act"), with respect to the Debt Securities offered hereby. This Prospectus,
which constitutes part of the Registration Statement, omits certain of the
information contained in the Registration Statement and the exhibits and
schedules thereto on file with the Commission pursuant to the Securities Act
and the rules and regulations of the Commission thereunder. In addition,
certain documents filed by NIKE with the Commission have been incorporated by
reference in this Prospectus. See "Incorporation of Certain Documents by
Reference". The Registration Statement, including exhibits and schedules
thereto and such incorporated documents, may be inspected and copied at the
public reference facilities maintained by the Commission at its principal
office in Washington, D.C. or at its regional offices. Statements contained in
this Prospectus as to the contents of any contract or other document referred
to are not necessarily complete and in each instance reference is made to the
copy of such contract or other document filed as an exhibit to the
Registration Statement, each such statement being qualified in all respects by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by NIKE with the Commission
pursuant to the Exchange Act and are hereby incorporated by reference in this
Prospectus:
a. NIKE's Annual Report on Form 10-K for the fiscal year ended May 31,
1996, as amended by its Form 10-K/A dated August 29, 1996;
b. NIKE's Quarterly Report on Form 10-Q for the fiscal quarter ended August
31, 1996;
c. NIKE's Current Report on Form 8-K dated July 9, 1996; and
d. NIKE's Current Report on Form 8-K dated September 16, 1996.
Each document filed by NIKE pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of all Debt Securities to which this Prospectus
relates shall be deemed to be incorporated by reference in this Prospectus and
to be part hereof from the date of filing such documents.
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein (or in the applicable Prospectus Supplement) or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein
2
<PAGE>
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Copies of all documents which are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are
specifically incorporated by reference in such documents) will be provided
without charge to each person, including any beneficial owner, to whom this
Prospectus (or the applicable Prospectus Supplement) is delivered upon written
or oral request. Requests for such documents should be directed to NIKE, Inc.,
One Bowerman Drive, Beaverton, Oregon 97005-6453, Attention: Investor
Relations (telephone: (503) 671-6453).
THE COMPANY
NIKE, Inc.'s principal business activity involves the design, development
and worldwide marketing of high quality footwear, apparel and accessory
products. NIKE sells its products to approximately 18,000 retail accounts in
the United States and through a mix of independent distributors, licensees and
subsidiaries in approximately 110 countries around the world. Virtually all of
NIKE's products are manufactured by independent contractors. Most footwear
products are produced outside the United States, while apparel products are
produced both in the United States and abroad.
NIKE, Inc., was incorporated in 1968 under the laws of the state of Oregon.
As used herein and in any Prospectus Supplement, the terms "NIKE" and the
"Company" refer to NIKE, Inc. and its predecessors, subsidiaries and
affiliates, unless the context indicates otherwise. NIKE's principal executive
offices are located at One Bowerman Drive, Beaverton, Oregon 97005-6453 and
its telephone number is (503) 671-6453.
USE OF PROCEEDS
Except as may be set forth in the Prospectus Supplement, NIKE intends to use
the net proceeds from the sale of the Debt Securities for general corporate
purposes, including, without limitation, working capital, capital
expenditures, investments in subsidiaries and refinancing of debt.
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<PAGE>
SELECTED FINANCIAL DATA
The selected consolidated financial data shown below for, and as of the end
of, each of the years in the five-year period ended May 31, 1996 have been
derived from NIKE's consolidated financial statements, which have been audited
by Price Waterhouse LLP, independent accountants, and which have been
incorporated in this Prospectus by reference. The selected consolidated
financial data should be read in conjunction with NIKE's Consolidated
Financial Statements, incorporated herein by reference.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED MAY 31,
----------------------------------------------------------
1992 1993 1994 1995 1996
---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME
DATA:
Revenues............... $3,405,211 $3,930,984 $3,789,668 $4,760,834 $6,470,625
Gross margin........... 1,316,122 1,543,991 1,488,245 1,895,554 2,563,879
Gross margin as a
percentage of
Revenues.............. 38.7% 39.3% 39.3% 39.8% 39.6%
Selling, general and
administrative
expenses.............. 761,498 922,261 974,099 1,209,760 1,588,612
Selling, general and
administrative
expenses as a
percentage of
Revenues.............. 22.4% 23.5% 25.7% 25.4% 24.6%
Net income............. 329,218 365,016 298,794 399,664 553,190
BALANCE SHEET DATA
(PERIOD END):
Cash and equivalents... 260,050 291,284 518,816 216,071 262,117
Inventories............ 471,202 592,986 470,023 629,742 931,151
Working capital........ 964,291 1,165,204 1,208,444 938,393 1,259,881
Total assets........... 1,871,667 2,186,269 2,373,815 3,142,745 3,951,628
Short-term debt(1)..... 162,648 218,692 249,509 558,523 689,778
Long-term debt......... 69,476 15,033 12,364 10,565 9,584
Common shareholders'
equity................ 1,328,488 1,642,819 1,740,949 1,964,689 2,431,400
OTHER DATA:
Cash flow from
operations............ 435,838 265,292 576,463 254,913 330,021
Ratio of earnings to
fixed charges(2)...... 14.27 16.80 18.44 17.67 16.53
GEOGRAPHIC REVENUES:
United States.......... $2,270,880 $2,528,848 $2,432,684 $2,997,864 $3,964,662
Europe................. 919,763 1,085,683 927,269 980,444 1,334,340
Asia/Pacific........... 75,732 178,196 283,421 515,652 735,094
Canada, Latin America
and other............. 138,836 138,257 146,294 266,874 436,529
---------- ---------- ---------- ---------- ----------
Total Revenues......... $3,405,211 $3,930,984 $3,789,668 $4,760,834 $6,470,625
========== ========== ========== ========== ==========
</TABLE>
- --------
(1) Short-term debt consists of current portion of long-term debt, notes
payable and interest-bearing accounts payable.
(2) In accordance with the rules and regulations of the Commission, for
purposes of computing the ratios of earnings to fixed charges, earnings
represent income from operations before fixed charges and taxes, and fixed
charges represent interest on indebtedness, amortization of debt discount
and a share of rental expense which is deemed to be representative of the
interest factor.
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<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities offered hereby are to be issued under an indenture (the
"Indenture") to be executed by NIKE and a trustee, as Trustee (the "Trustee").
A copy of the form of Indenture has been filed as an exhibit to the
Registration Statement. Section references used in this Prospectus refer to
sections of the Indenture.
NIKE may offer under this Prospectus up to $500,000,000 aggregate principal
amount of Debt Securities, or if Debt Securities are issued at a discount, or
in a foreign currency or composite currency, such principal amount as may be
sold for an initial public offering price of up to $500,000,000. Unless
otherwise specified in the applicable Prospectus Supplement, the Debt
Securities will represent direct, unsecured obligations of NIKE and will rank
equally with all other unsecured and unsubordinated indebtedness of NIKE.
The following statements relating to the Debt Securities and the Indenture
are summaries and do not purport to be complete. Such summaries may make use
of certain terms defined in the Indenture and are qualified in their entirety
by express reference to the Indenture. In addition, certain defined terms are
set forth below under "--Certain Definitions".
GENERAL
The terms of each series of Debt Securities will be established by or
pursuant to a resolution of the Board of Directors of NIKE and set forth or
determined in the manner provided in an Officers' Certificate or by a
supplemental indenture. (Indenture (S) 2.2) The particular terms of each
series of Debt Securities will be described in a Prospectus Supplement
relating to such series (including any Pricing Supplement thereto).
The Debt Securities that may be offered under the Indenture are not limited
in aggregate principal amount. The Debt Securities may be issued in one or
more series with the same or various maturities, at par, at a premium, or at a
discount. The Prospectus Supplement (including any Pricing Supplement thereto)
will set forth the initial offering price, the aggregate principal amount and
the following terms of the Debt Securities in respect of which this Prospectus
is delivered: (1) the title of such Debt Securities; (2) the price or prices
(expressed as a percentage of the aggregate principal amount thereof) at which
the Debt Securities will be issued; (3) any limit on the aggregate principal
amount of such Debt Securities; (4) the date or dates on which principal on
such Debt Securities will be payable; (5) the rate or rates (which may be
fixed or variable) per annum or, if applicable, the method used to determine
such rate or rates (including any commodity, commodity index, stock exchange
index or financial index) at which such Debt Securities will bear interest, if
any, the date or dates from which such interest, if any, will accrue, the date
or dates on which such interest, if any, will commence and be payable and any
regular record date for the interest payable on any interest payment date; (6)
the place or places where principal of, premium, if any, and interest, if any,
on such Debt Securities will be payable; (7) the period or periods within
which, the price or prices at which and the terms and conditions upon which
the Debt Securities may be redeemed; (8) the obligation, if any, of NIKE to
redeem or purchase the Debt Securities pursuant to any sinking fund or
analogous provisions or at the option of a holder thereof; (9) the dates, if
any, on which and the price or prices at which the Debt Securities will be
repurchased by NIKE at the option of the Holders thereof and other detailed
terms and provisions of such repurchase obligations; (10) the denominations in
which such Debt Securities may be issuable, if other than denominations of
$1,000 and any integral multiple thereof; (11) whether the Debt Securities are
to be issuable in the form of Certificated Debt Securities (as defined below)
or Global Debt Securities (as defined below); (12) the portion of principal
amount of such Debt Securities that shall be payable upon declaration of
acceleration of the maturity date thereof, if other than the principal amount
thereof; (13) the currency of denomination of such Debt Securities; (14) the
designation of the currency, currencies or currency units in which payment of
principal of, premium, if
5
<PAGE>
any, and interest, if any, on such Debt Securities will be made; (15) if
payments of principal of, premium, if any, or interest, if any, on the Debt
Securities are to be made in one or more currencies or currency units other
than that or those in which such Debt Securities are denominated, the manner
in which the exchange rate with respect to such payments will be determined;
(16) the manner in which the amounts of payment of principal of, premium, if
any, or interest, if any, on such Debt Securities will be determined, if such
amounts may be determined by reference to an index based on a currency or
currencies other than that in which the Debt Securities are denominated or
designated to be payable or by reference to a commodity, commodity index,
stock exchange index or financial index; (17) the provisions, if any, relating
to any security provided for such Debt Securities; (18) any addition to or
change in the Events of Default described herein or in the Indenture with
respect to such Debt Securities and any change in the acceleration provisions
described herein or in the Indenture with respect to such Debt Securities;
(19) any addition to or change in the covenants described herein or in the
Indenture with respect to such Debt Securities; (20) any other terms of such
Debt Securities, none of which will be inconsistent with the Indenture but
which may modify or delete any provision of the Indenture insofar as it
applies to such series; and (21) any depositaries, interest rate calculation
agents, exchange rate calculation agents or other agents with respect to the
Debt Securities other than those originally appointed. (Indenture (S) 2.2)
Debt Securities may be issued that provide for an amount less than the
stated principal amount thereof to be due and payable upon declaration of
acceleration of the maturity thereof pursuant to the terms of the Indenture
("Discount Securities"). Federal income tax considerations and other special
considerations applicable to any such Discount Securities will be described in
the applicable Prospectus Supplement.
If the purchase price of any of the Debt Securities is denominated in a
foreign currency or currencies, or a foreign currency unit or units or if the
principal of and any premium and interest on any series of Debt Securities is
payable in a foreign currency or currencies or a foreign currency unit or
units, the restrictions, elections, general tax considerations, specific terms
and other information with respect to such issue of Debt Securities and such
foreign currency or currencies or foreign currency unit or units will be set
forth in the applicable Prospectus Supplement.
PAYMENT OF INTEREST AND EXCHANGE
Each Debt Security will be represented by either one or more global
securities (a "Global Debt Security") registered in the name of The Depository
Trust Company, as Depository (the "Depository") or a nominee of the Depository
(each such Debt Security represented by a Global Debt Security being herein
referred to as a "Book-Entry Debt Security"), or a certificate issued in
definitive registered form (a "Certificated Debt Security"), as set forth in
the applicable Prospectus Supplement. Except as set forth under "Global Debt
Securities and Book-Entry System" below, Book-Entry Debt Securities will not
be issuable in certificate form.
CERTIFICATED DEBT SECURITIES. Certificated Debt Securities may be
transferred or exchanged at the Trustee's office or paying agencies in
accordance with the terms of the Indenture. No service charge will be made for
any transfer or exchange of Certificated Debt Securities, but NIKE may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The transfer of Certificated Debt Securities and the right to the principal
of, premium, if any, and interest, if any, on such Certificated Debt
Securities may be effected only by surrender of the old certificate
representing such Certificated Debt Securities and either reissuance by NIKE
or the Trustee of the old certificate to the new Holder or the issuance by
NIKE or the Trustee of a new certificate to the new Holder.
6
<PAGE>
GLOBAL DEBT SECURITIES AND BOOK-ENTRY SYSTEM. Each Global Debt Security
representing Book-Entry Debt Securities will be deposited with, or on behalf
of, the Depository, and registered in the name of the Depository or a nominee
of the Depository. Except as set forth below, Book-Entry Debt Securities will
not be exchangeable for Certificated Debt Securities and will not otherwise be
issuable as Certificated Debt Securities.
The procedures that the Depository has indicated it intends to follow with
respect to Book-Entry Debt Securities are set forth below.
Ownership of beneficial interests in Book-Entry Debt Securities will be
limited to persons that have accounts with the Depository for the related
Global Debt Security ("participants") or persons that may hold interests
through participants. Upon the issuance of a Global Debt Security, the
Depository will credit, on its book-entry registration and transfer system,
the participants' accounts with the respective principal amounts of the Book-
Entry Debt Securities represented by such Global Debt Security beneficially
owned by such participants. The accounts to be credited shall be designated by
any dealers, underwriters or agents participating in the distribution of such
Book-Entry Debt Securities. Ownership of Book-Entry Debt Securities will be
shown on, and the transfer of such ownership interests will be effected only
through, records maintained by the Depository for the related Global Debt
Security (with respect to interests of participants) and on the records of
participants (with respect to interests of persons holding through
participants). The laws of some states may require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to own, transfer or pledge
beneficial interests in Book-Entry Debt Securities.
So long as the Depository for a Global Debt Security, or its nominee, is the
registered owner of such Global Debt Security, such Depository or such
nominee, as the case may be, will be considered the sole owner or holder of
the Book-Entry Debt Securities represented by such Global Debt Security for
all purposes under the Indenture. Except as set forth below, owners of Book-
Entry Debt Securities will not be entitled to have such securities registered
in their names, will not receive or be entitled to receive physical delivery
of a certificate in definitive form representing such securities and will not
be considered the owners or holders thereof under the Indenture. Accordingly,
each person owning Book-Entry Debt Securities must rely on the procedures of
the Depository for the related Global Debt Security and, if such person is not
a participant, on the procedures of the participant through which such person
owns its interest, to exercise any rights of a holder under the Indenture.
The Company understands, however, that under existing industry practice, the
Depository will authorize the persons on whose behalf it holds a Global Debt
Security to exercise certain rights of holders of Debt Securities, and the
Indenture provides that the Company, the Trustee and their respective agents
will treat as the holder of a Debt Security the persons specified in a written
statement of the Depository with respect to such Global Debt Security for
purposes of obtaining any consents or directions required to be given by
holders of the Debt Securities pursuant to the Indenture. (Indenture (S)
2.14.6)
Payments of principal, premium, if any, and interest on Book-Entry Debt
Securities will be made to the Depository or its nominee, as the case may be,
as the registered holder of the related Global Debt Security. (Indenture (S)
2.14.5) None of NIKE, the Trustee or any other agent of NIKE or agent of the
Trustee will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in such Global Debt Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
NIKE expects that the Depository, upon receipt of any payment of principal,
premium, if any, or interest on a Global Debt Security, will immediately
credit participants' accounts with payments in amounts proportionate to the
respective amounts of Book-Entry Debt Securities held by each such
7
<PAGE>
participant as shown on the records of such Depository. NIKE also expects that
payments by participants to owners of beneficial interests in Book-Entry Debt
Securities held through such participants will be governed by standing
customer instructions and customary practices, as is now the case with the
securities held for the accounts of customers in bearer form or registered in
"street name", and will be the responsibility of such participants.
If the Depository is at any time unwilling or unable to continue as
Depository or ceases to be a clearing agency registered under the Exchange
Act, and a successor Depository registered as a clearing agency under the
Exchange Act is not appointed by NIKE within 90 days, NIKE will issue
Certificated Debt Securities in exchange for each Global Debt Security. In
addition, NIKE may at any time and in its sole discretion determine not to
have any of the Book-Entry Debt Securities represented by one or more Global
Debt Securities and, in such event, will issue Certificated Debt Securities
issued in exchange for a Global Debt Security or Securities. Global Debt
Securities will also be exchangeable for Certificated Debt Securities if an
Event of Default with respect to the Book-Entry Debt Securities represented by
such Global Debt Securities has occurred and is continuing. Any Certificated
Debt Securities issued in exchange for a Global Debt Security will be
registered in such name or names as the Depository shall instruct the Trustee.
It is expected that such instructions will be based upon directions received
by the Depository from participants with respect to ownership of Book-Entry
Debt Securities relating to such Global Debt Security.
The foregoing information in this section concerning the Depository and the
Depository's Book-Entry System has been obtained from sources the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
NO PROTECTION IN THE EVENT OF A CHANGE OF CONTROL
Unless otherwise set forth in the Prospectus Supplement, the Debt Securities
will not contain any provisions which may afford holders of the Debt
Securities protection in the event of a change in control of NIKE or in the
event of a highly leveraged transaction (whether or not such transaction
results in a change in control of NIKE).
COVENANTS
Unless otherwise set forth in the Prospectus Supplement and in a supplement
to the Indenture, a Board Resolution or an Officers' Certificate delivered
pursuant thereto, and except as set forth below, the Debt Securities will not
contain any restrictive covenants, including covenants restricting NIKE or any
of its subsidiaries from incurring, issuing, assuming or guarantying any
indebtedness secured by a lien upon any property or shares of capital stock of
NIKE or any subsidiary, or restricting NIKE or any subsidiary from entering
into any sale and leaseback transactions.
CONSOLIDATION, MERGER AND SALE OF ASSETS
NIKE may not consolidate with or merge into, or convey, transfer or lease
all or substantially all of its properties and assets to, any Person (a
"successor Person"), and may not permit any Person to merge into, or convey,
transfer or lease its properties and assets substantially as an entirety to,
NIKE, unless (i) the successor Person (if any) is a corporation, partnership,
trust or other entity organized and validly existing under the laws of any
U.S. domestic jurisdiction and expressly assumes NIKE's obligations on the
Debt Securities and under the Indenture, (ii) immediately after giving effect
to the transaction, no Event of Default, and no event which, after notice or
lapse of time, or both, would become an Event of Default, shall have occurred
and be continuing under the Indenture and (iii) certain other conditions are
met. (Indenture (S) 5.1)
8
<PAGE>
EVENTS OF DEFAULT
The following will be Events of Default under the Indenture with respect to
Debt Securities of any series: (a) default in the payment of any interest upon
any Debt Security of that series when it becomes due and payable, and
continuance of such default for a period of 30 days (unless the entire amount
of such payment is deposited by NIKE with the Trustee or with a paying agent
prior to the expiration of such period of 30 days); (b) default in the payment
of principal of or premium, if any, on any Debt Security of that series when
due and payable; (c) default in the deposit of any sinking fund payment, when
and as due in respect of any Debt Security of that series; (d) default in the
performance or breach of any other covenant or warranty of NIKE in the
Indenture (other than a covenant or warranty that has been included in the
Indenture solely for the benefit of a series of Debt Securities other than
that series), which default continues uncured for a period of 60 days after
written notice to NIKE by the Trustee or to NIKE and the Trustee by the
holders of at least 25% in principal amount of the outstanding Debt Securities
of that series as provided in the Indenture; (e) an event of default under any
Debt of NIKE (including a default with respect to Debt Securities of any
series other than that series) or any Subsidiary, whether such Debt now exists
or shall hereafter be created, if (A) such default results from the failure to
pay any such Debt when it becomes due, (B) the principal amount of such Debt,
together with the principal amount of any other such Debt in default for
failure to pay principal at stated final maturity or the maturity of which has
been so accelerated, aggregates $100 million or more at any one time
outstanding and (C) such Debt is not discharged or such acceleration is not
rescinded or annulled within 10 days after written notice as provided in the
Indenture; (f) certain events of bankruptcy, insolvency or reorganization; and
(g) any other Event of Default provided with respect to Debt Securities of
that series that is described in the Prospectus Supplement accompanying this
Prospectus. No Event of Default with respect to a particular series of Debt
Securities (except as to the certain events in bankruptcy, insolvency or
reorganization) necessarily constitutes an Event of Default with respect to
any other series of Debt Securities. (Indenture (S) 6.1). The occurrence of an
Event of Default may constitute an event of default under NIKE's bank credit
agreements in existence from time to time and under certain guaranties by NIKE
of any subsidiary indebtedness. In addition, the occurrence of certain Events
of Default or an acceleration under the Indenture may constitute an event of
default under certain other indebtedness of NIKE outstanding from time to
time.
If an Event of Default with respect to Debt Securities of any series at the
time outstanding occurs and is continuing, then in every such case the Trustee
or the holders of not less than 25% in principal amount of the outstanding
Debt Securities of that series may, by a notice in writing to NIKE (and to the
Trustee if given by the holders), declare to be due and payable immediately
the principal (or, if the Debt Securities of that series are Discount
Securities, such portion of the principal amount as may be specified in the
terms of that series) and premium, if any, of all Debt Securities of that
series. In the case of an Event of Default resulting from certain events of
bankruptcy, insolvency or reorganization, the principal (or such specified
amount) and premium, if any, of all outstanding Debt Securities shall ipso
facto become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any holder of outstanding Debt
Securities. At any time after a declaration of acceleration with respect to
Debt Securities of any series has been made, but before a judgment or decree
for payment of the money due has been obtained by the Trustee, the holders of
a majority in principal amount of the outstanding Debt Securities of that
series may, subject to NIKE having paid or deposited with the Trustee a sum
sufficient to pay overdue interest and principal which has become due other
than by acceleration and certain other conditions, rescind and annul such
acceleration if all Events of Default, other than the non-payment of
accelerated principal and premium, if any, with respect to Debt Securities of
that series, have been cured or waived as provided in the Indenture.
(Indenture (S) 6.2) For information as to waiver of defaults see the
discussion set forth below under "--Modification and Waiver". Reference is
made to the Prospectus Supplement relating to any series of Debt Securities
that are Discount Securities for the particular provisions relating to
acceleration of a portion of the principal amount of such Discount Securities
upon the occurrence of an Event of Default and the continuation thereof.
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<PAGE>
The Indenture provides that the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request of any
holder of outstanding Debt Securities, unless the Trustee receives indemnity
satisfactory to it against any loss, liability or expense. (Indenture (S)
7.1(e)) Subject to certain rights of the Trustee, the holders of a majority in
principal amount of the outstanding Debt Securities of any series shall have
the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee with respect to the Debt Securities of that series.
(Indenture (S) 6.12)
No holder of any Debt Security of any series will have any right to
institute any proceeding, judicial or otherwise, with respect to the Indenture
or for the appointment of a receiver or trustee, or for any remedy under the
Indenture, unless such holder shall have previously given to the Trustee
written notice of a continuing Event of Default with respect to Debt
Securities of that series and unless also the holders of at least 25% in
principal amount of the outstanding Debt Securities of that series shall have
made written request, and offered reasonable indemnity, to the Trustee to
institute such proceeding as trustee, and the Trustee shall not have received
from the holders of a majority in principal amount of the outstanding Debt
Securities of that series a direction inconsistent with such request and shall
have failed to institute such proceeding within 60 days. (Indenture (S) 6.7)
Notwithstanding the foregoing, the holder of any Debt Security will have an
absolute and unconditional right to receive payment of the principal of,
premium, if any, and any interest on such Debt Security on or after the due
dates expressed in such Debt Security and to institute suit for the
enforcement of any such payment. (Indenture (S) 6.8)
The Indenture requires NIKE, within 90 days after the end of each of its
fiscal years, to furnish to the Trustee a statement as to compliance with the
Indenture. (Indenture (S) 4.3) The Indenture provides that the Trustee may
withhold notice to the holders of Debt Securities of any series of any Default
or Event or Default (except in payment on any Debt Securities of such series)
with respect to Debt Securities of such series if it in good faith determines
that withholding such notice is in the interest of the holders of such Debt
Securities. (Indenture (S) 7.5)
MODIFICATION AND WAIVER
Modifications to, and amendments of, the Indenture may be made by NIKE and
the Trustee with the consent of the holders of at least a majority in
principal amount of the outstanding Debt Securities of each series affected by
such modifications or amendments; provided, however, that no such modification
or amendment may, without the consent of the holder of each outstanding Debt
Security affected thereby: (a) change the amount of Debt Securities whose
holders must consent to an amendment or waiver; (b) reduce the rate of or
extend the time for payment of interest (including default interest) on any
Debt Security; (c) reduce the principal or premium, if any, or change the
fixed maturity of any Debt Security or reduce the amount of, or postpone the
date fixed for, the payment of any sinking fund or analogous obligation with
respect to any series of Debt Securities; (d) reduce the principal amount of
Discount Securities payable upon acceleration of the maturity thereof; (e)
waive a default in the payment of the principal of, premium, if any, or
interest, if any, on any Debt Security (except a rescission of acceleration of
the Debt Securities of any series by the holders of at least a majority in
aggregate principal amount of the then outstanding Debt Securities of such
series and a waiver of the payment default that resulted from such
acceleration); (f) make the principal of or premium, if any, or interest, if
any, on any Debt Security payable in currency other than that stated in the
Debt Security; (g) make any change to certain provisions of the Indenture
relating to, among other things, the right of holders of Debt Securities to
receive payment of the principal, premium, if any, and interest on such Debt
Securities and to institute suit for the enforcement of any such payment and
to waivers or amendments; or (h) waive a redemption payment with respect to
any Debt Security or change any of the provisions with respect to the
redemption of any Debt Securities. (Indenture (S) 9.3)
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<PAGE>
The holders of at least a majority in principal amount of the outstanding
Debt Securities of any series may on behalf of the holders of all Debt
Securities of that series waive, insofar as that series is concerned,
compliance by NIKE with provisions of the Indenture other than certain
specified provisions. (Indenture (S) 9.2) The holders of a majority in
principal amount of the outstanding Debt Securities of any series may on
behalf of the holders of all the Debt Securities of such series waive any past
default under the Indenture with respect to such series and its consequences,
except a default in the payment of the principal of, premium, if any, or any
interest on any Debt Security of that series; provided, however, that the
holders of a majority in principal amount of the outstanding Debt Securities
of any series may rescind an acceleration and its consequences, including any
related payment default that resulted from such acceleration. (Indenture (S)
6.13)
DEFEASANCE OF DEBT SECURITIES AND CERTAIN COVENANTS IN CERTAIN CIRCUMSTANCES
LEGAL DEFEASANCE. The Indenture provides that NIKE may be discharged from
any and all obligations in respect of the Debt Securities of any series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace stolen, lost or mutilated Debt
Securities of such series, and to maintain paying agencies and certain
provisions relating to the treatment of funds held by paying agents) upon the
deposit with the Trustee, in trust, of money and/or U.S. Government
Obligations or, in the case of Debt Securities denominated in a single
currency other than U.S. Dollars, Foreign Government Obligations, that,
through the payment of interest and principal in respect thereof in accordance
with their terms, will provide money in an amount sufficient in the opinion of
a nationally recognized firm of independent public accountants to pay and
discharge each installment of principal (and premium, if any) and interest, if
any, on and any mandatory sinking fund payments in respect of the Debt
Securities of such series on the stated maturity of such payments in
accordance with the terms of the Indenture and such Debt Securities. Such
discharge may occur only if, among other things, NIKE has received from, or
there has been published by, the United States Internal Revenue Service a
ruling, or, since the date of execution of the Indenture, there has been a
change in the applicable United States federal income tax law, in either case
to the effect that holders of the Debt Securities of such series will not
recognize income, gain or loss for United States federal income tax purposes
as a result of such deposit, defeasance and discharge and will be subject to
United States federal income tax on the same amount and in the same manner and
at the same times as would have been the case if such deposit, defeasance and
discharge had not occurred. (Indenture (S) 8.3)
DEFEASANCE OF CERTAIN COVENANTS. The Indenture provides that unless
otherwise provided by the terms of the applicable series of Debt Securities,
upon compliance with certain conditions, (i) NIKE may omit to comply with the
restrictive covenants contained in Sections 4.2, 4.3 through 4.6 and Section
5.1 of the Indenture, as well as any additional covenants contained in a
supplement to the Indenture, a Board Resolution or an Officers' Certificate
delivered pursuant thereto; and (ii) Events of Default under Section 6.1(e)
shall be inapplicable to such series. The conditions include: the deposit with
the Trustee of money and/or U.S. Government Obligations or, in the case of
Debt Securities denominated in a single currency other than U.S. Dollars,
Foreign Government Obligations, that, through the payment of interest and
principal in respect thereof in accordance with their terms, will provide
money in an amount sufficient in the opinion of a nationally recognized firm
of independent public accountants to pay principal, premium, if any, and
interest, if any, on and any mandatory sinking fund payments in respect of the
Debt Securities of such series on the stated maturity of such payments in
accordance with the terms of the Indenture and such Debt Securities; and the
delivery to the Trustee of an opinion of counsel to the effect that the
holders of the Debt Securities of such series will not recognize income, gain
or loss for United States federal income tax purposes as a result of such
deposit and related covenant defeasance and will be subject to United States
federal income tax in the same amount and in the same manner and at the same
times as would have been the case if such deposit and related covenant
defeasance had not occurred. (Indenture (S) 8.4)
11
<PAGE>
DEFEASANCE AND EVENTS OF DEFAULT. In the event NIKE exercises its option to
omit compliance with certain covenants of the Indenture with respect to any
series of Debt Securities and the Debt Securities of such series are declared
due and payable because of the occurrence of any Event of Default, the amount
of money and/or U.S. Government Obligations or Foreign Government Obligations
on deposit with the Trustee will be sufficient to pay amounts due on the Debt
Securities of such series at the time of their stated maturity but may not be
sufficient to pay amounts due on the Debt Securities of such series at the
time of the acceleration resulting from such Event of Default. However, NIKE
shall remain liable for such payments.
"FOREIGN GOVERNMENT OBLIGATIONS" means, with respect to Debt Securities of
any series that are denominated in a currency other than U.S. Dollars, (i)
direct obligations of the government that issued or caused to be issued such
currency for the payment of which obligations its full faith and credit is
pledged or (ii) obligations of a Person controlled or supervised by or acting
as an agency or instrumentality of such government the timely payment of which
is unconditionally guaranteed as a full faith and credit obligation by such
government, which, in either case under clauses (i) or (ii), are not callable
or redeemable at the option of the issuer thereof.
GOVERNING LAW
The Indenture and the Debt Securities will be governed by, and construed in
accordance with, the internal laws of the State of New York. (Indenture (S)
10.10)
PLAN OF DISTRIBUTION
NIKE may sell Debt Securities to or through underwriters and also may sell
Debt Securities directly to other purchasers or through agents.
The distribution of the Debt Securities may be effected from time to time in
one or more transactions at a fixed price or prices, which may be changed, or
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices.
In connection with the sale of Debt Securities, underwriters may receive
compensation from NIKE or from purchasers of Debt Securities for whom they may
act as agents in the form of discounts, concessions or commissions.
Underwriters may sell Debt Securities to or through dealers, and such dealers
may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for whom they may
act as agents. Underwriters, dealers and agents that participate in the
distribution of Debt Securities may be deemed to be underwriters under the
Securities Act, and any discounts or commissions received by them from NIKE
and any profit on the resale of Debt Securities by them may be deemed to be
underwriting discounts and commissions under the Securities Act. Any such
underwriter or agent will be identified, and any compensation received from
NIKE will be described, in the Prospectus Supplement.
NIKE may enter into agreements under which underwriters and agents who
participate in the distribution of Debt Securities may be entitled to
indemnification by NIKE against certain liabilities, including liabilities
under the Securities Act.
LEGAL MATTERS
The validity of the Debt Securities will be passed upon for NIKE by Latham &
Watkins, San Francisco, California and by Paul J. Kelly, Jr., Esq., General
Counsel of NIKE.
12
<PAGE>
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference to the Company's Current Report on Form 8-K dated September 16, 1996
have been so incorporated in reliance upon the report of Price Waterhouse LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained or incorporated by reference in this Prospectus
or any Prospectus Supplement, including, without limitation, statements
containing the words "believes", "anticipates", "expects" and words of similar
import, constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of NIKE, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following: international,
national and local general economic and market conditions; demographic
changes; the size and growth of the overall athletic market or the footwear or
apparel segments thereof; the ability of NIKE to sustain, manage or forecast
its growth; the size, timing and mix of purchases of NIKE's products; new
product development and introduction; changes in consumer preferences;
existing government regulations and changes in, or the failure to comply with,
government regulations; adverse publicity; dependence on distributors;
liability and other claims asserted against NIKE; competition; the loss of
significant customers or suppliers; fluctuations and difficulty in forecasting
operating results, including, without limitation, the fact that futures orders
may not be indicative of future revenues; changes in business strategy or
development plans; business disruptions; general risks associated with doing
business outside of the United States, including, without limitation, import
duties, tariffs, quotas and political instability; the ability to attract and
retain qualified personnel; the ability to protect trademarks, patents and
other intellectual property; the use of proceeds from the offering; and other
factors referenced or incorporated by reference in this Prospectus or any
Prospectus Supplement. GIVEN SUCH UNCERTAINTIES, PROSPECTIVE INVESTORS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON SUCH FORWARD-LOOKING STATEMENTS. NIKE
disclaims any obligation to update any such factors or to publicly announce
the results of any revisions to any of the forward-looking statements
contained or incorporated by reference herein to reflect future events or
developments.
13
<PAGE>
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS
PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED
HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
The Company................................................................ S-3
Use of Proceeds............................................................ S-5
Recent Selected Financial Data............................................. S-6
Description of the Notes................................................... S-7
Underwriting............................................................... S-9
Validity of the Notes...................................................... S-9
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by
Reference................................................................. 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Selected Financial Data.................................................... 4
Description of Debt Securities............................................. 5
Plan of Distribution....................................................... 12
Legal Matters.............................................................. 12
Experts.................................................................... 13
Special Note Regarding Forward-Looking Statements.......................... 13
</TABLE>
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$200,000,000
NIKE, INC.
6 3/8% NOTES DUE DECEMBER 1, 2003
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LOGO
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GOLDMAN, SACHS & CO.
SALOMON BROTHERS INC
LEHMAN BROTHERS INC.
MERRILL LYNCH & CO.
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