Summary
NIKE, Inc. filed an 8-K on July 20, 2010, to report on compensatory arrangements for its employees, including named executive officers. The primary focus of this filing is the approval of annual grants of stock options and restricted stock by the Compensation Committee on July 16, 2010. These awards introduced material changes to vesting and forfeiture provisions compared to prior years, signaling a shift in how executive compensation is structured and protected.
Key Highlights
- 1New "double trigger" provision for accelerated vesting of stock options and restricted stock upon a change in control, requiring both a change in control and subsequent termination of employment (without cause or for good reason) within two years for acceleration.
- 2Vesting of stock options will also accelerate if the acquiring company in a change in control does not assume outstanding options.
- 3Introduction of a Policy for Recoupment of Incentive Compensation, allowing the company to recover excess proceeds from sales of shares acquired through stock options and restricted stock if an executive's misconduct leads to a financial restatement.
- 4Modified vesting acceleration for stock options upon retirement: vesting accelerates if the holder retires at age 60+ with 5+ years of service, and continues regardless of employment termination if the holder retires at age 55+ with 5+ years of service.
- 5Extended exercise period for stock options upon certain qualifying terminations (death, disability, retirement at 55+ with 5+ years of service, or 'double trigger' termination) to four years following termination or the original 10-year expiration, whichever is shorter.
- 6Grant details for Named Executive Officers, including Mark G. Parker (CEO), with specific numbers of restricted stock and stock options awarded.
- 7Stock options were granted with an exercise price of $68.96, reflecting the closing price of NKE's Class B Common Stock on the grant date.