Who is Travis A. Knight and why was he appointed to the Board?

Travis A. Knight, 41, was appointed as a Director of NIKE, Inc. effective June 30, 2015. He is the President and CEO of LAIKA, LLC, an animation studio, and has extensive experience in creative and business decisions there. He is also the son of NIKE Board Chairman Philip H. Knight. His appointment is part of the company's standard director compensation program.

What is the nature of the equity award granted to CEO Mark G. Parker?

CEO Mark G. Parker received a grant of restricted stock units (RSUs) with a target value of $30 million. This award is split into two components: 60% are Performance-Based RSUs tied to the company's cumulative revenue and diluted EPS growth over fiscal years 2016-2020, and 40% are Time-Based RSUs contingent on his continued employment through June 30, 2020.

What are the performance targets for Mark G. Parker's performance-based RSUs?

For the performance-based RSUs, Mr. Parker can earn up to a maximum of 100% of the target shares if NIKE achieves a 9% compound annual growth rate (CAGR) in cumulative revenue and a 13% CAGR in cumulative diluted EPS from fiscal 2015 through fiscal 2020. A threshold payout (50% of target shares) requires a 7% CAGR for revenue and a 9% CAGR for EPS. No shares are earned if performance falls below the threshold for either metric.

Are there any special conditions or acceleration clauses for Mr. Parker's RSU award?

Yes, the RSUs have provisions for vesting acceleration. In the event of a 'change in control' of the company, followed by termination of Mr. Parker's employment without 'cause' or by him for 'good reason' within two years, the Performance-Based RSUs vest at target and Time-Based RSUs vest 100%. Upon death or disability, Performance-Based RSUs vest at threshold and Time-Based RSUs vest 100%. The award also includes provisions for recoupment of RSUs in case of breaches of confidentiality or other obligations.

NKE 8-K: Leadership Changes

Summary

NIKE, Inc. (NKE) filed an 8-K on June 30, 2015, announcing two key leadership and compensation developments. Firstly, the Board of Directors appointed Travis A. Knight as a new Director, effective June 30, 2015. Mr. Knight, son of Board Chairman Philip H. Knight, brings a background in animation and creative leadership from LAIKA, LLC, and is expected to serve on the Corporate Responsibility and Sustainability Committee and the Executive Committee. His appointment is part of the standard director compensation program. Secondly, the Compensation Committee approved a significant equity award for CEO Mark G. Parker. This award, with a target value of $30 million, consists of restricted stock units (RSUs) designed to incentivize Mr. Parker's continued leadership for at least the next five years. The award is split between performance-based RSUs (60%) tied to cumulative revenue and EPS growth over fiscal years 2016-2020, and time-based RSUs (40%) contingent on continued employment through June 30, 2020. The performance metrics are structured with threshold, target, and maximum payout levels, requiring specific compound annual growth rates for revenue and EPS.

Key Highlights

1Appointment of Travis A. Knight to the Board of Directors, effective June 30, 2015.
2Travis A. Knight is the son of Board Chairman Philip H. Knight and has a background in animation and leadership at LAIKA, LLC.
3Mr. Knight will serve on the Corporate Responsibility and Sustainability Committee and the Executive Committee.
4CEO Mark G. Parker received a restricted stock unit (RSU) award with a target value of $30 million.
5The RSU award is designed to incentivize Mr. Parker's leadership for at least the next five years (through fiscal year 2020).
660% of the award is performance-based, tied to cumulative revenue and EPS growth targets from fiscal 2016 to fiscal 2020.
740% of the award is time-based, contingent on Mr. Parker's continued employment through June 30, 2020.

NIKE, Inc. 8-K Report, Executive Changes (Jun 30, 2015)

Summary

Key Highlights

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