Nike 2006 Annual Report Download - page 9

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NIKE is the largest seller of athletic footwear and athletic apparel in the world. Performance and reliability
of shoes, apparel, and equipment, new product development, price, product identity through marketing and
promotion, and customer support and service are important aspects of competition in the athletic footwear,
apparel and equipment industry. To help market our products, we contract with prominent and influential
athletes, coaches, teams, colleges and sports leagues to endorse our brands and use our products, and we actively
sponsor sporting events and clinics. We believe that we are competitive in all of these areas.
Trademarks and Patents
We utilize trademarks on nearly all of our products and believe that having distinctive marks that are readily
identifiable is an important factor in creating a market for our goods, in identifying the Company, and in
distinguishing our goods from the goods of others. We consider our NIKE®and Swoosh Design®trademarks to
be among our most valuable assets and we have registered these trademarks in over 100 countries. In addition,
we own many other trademarks that we utilize in marketing our products. We continue to vigorously protect our
trademarks against infringement.
NIKE has an exclusive, worldwide license to make and sell footwear using patented “Air” technology. The
process utilizes pressurized gas encapsulated in polyurethane. Some of the early NIKE AIR®patents have
expired, which may enable competitors to use certain types of similar technology. Subsequent NIKE AIR®
patents will not expire for several years. We also have hundreds of U.S. and foreign patents covering
components, features, and designs used in various athletic and leisure shoes, apparel and equipment. These
patents expire at various times, and have a remaining duration of from now to at least 2026, although the duration
of patents varies by country. We believe that our success depends primarily upon skills in design, research and
development, production and marketing rather than upon our patent position. However, we have followed a
policy of filing applications for United States and foreign patents on inventions, designs and improvements that
we deem valuable.
Employees
We had approximately 28,000 employees at May 31, 2006. Management considers its relationship with
employees to be excellent. None of our employees is represented by a union, with the exception of NIKE Bauer
Hockey Inc. Of NIKE Bauer Hockey’s employees, approximately 37 percent, or approximately 183, are covered
by three union collective bargaining agreements with three separate bargaining units. The collective bargaining
agreements expire on various dates from 2007 through 2008. There has never been a material interruption of
operations due to labor disagreements.
Executive Officers of the Registrant
The executive officers of NIKE as of July 25, 2006 are as follows:
Philip H. Knight, Chairman of the Board — Mr. Knight, 68, a director since 1968, is a co-founder of NIKE
and, except for the period from June 1983 through September 1984, served as its President from 1968 to 1990,
and from June 2000 to December 2004. 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.
Mark G. Parker, Chief Executive Officer and President — Mr. Parker, 50, was appointed CEO and
President in January 2006. He has been employed by NIKE since 1979 with primary responsibilities in product
research, design and development, marketing, and brand management. Mr. Parker was appointed divisional Vice
President in charge of development in 1987, corporate Vice President in 1989, General Manager in 1993, Vice
President of Global Footwear in 1998, and President of the NIKE Brand in 2001.
Lewis L. Bird III, President, Subsidiaries — Mr. Bird, 42, joined NIKE as President, Subsidiaries in July
2006. Prior to joining NIKE, he held a number of management positions within multinational companies with
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