Nike 2016 Annual Report Download - page 16

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PART I
ITEM 1B. Unresolved Staff Comments
None.
ITEM 2. Properties
The following is a summary of principal properties owned or leased by NIKE:
The NIKE World Campus, owned by NIKE and located near Beaverton,
Oregon, USA, is a 400-acre site consisting of over 40 buildings which,
together with adjacent leased properties, functions as our world headquarters
and is occupied by approximately 10,700 employees engaged in
management, research, design, development, marketing, finance and other
administrative functions serving nearly all of our divisions. We also lease
various office facilities in the surrounding metropolitan area. We lease a similar,
but smaller, administrative facility in Hilversum, the Netherlands, which serves
as the headquarters for the Western Europe and Central & Eastern Europe
geographies and management of certain brand functions for our non-U.S.
operations. We also lease an office complex in Shanghai, China, our
headquarters for Greater China, occupied by employees focused on
implementing our wholesale, DTC and merchandising strategies in the region,
among other functions. In the United States, NIKE has five significant
distribution centers located in Memphis, Tennessee, two of which are owned
and three are leased. NIKE Brand apparel and equipment are also shipped
from our Foothill Ranch, California distribution center, which we lease. Smaller
leased distribution facilities are located in various parts of the United States.
We also own or lease distribution and customer service facilities outside the
United States. The most significant are the distribution facilities located in
Laakdal, Belgium; Taicang, China; Tomisato, Japan and Incheon, Korea, all of
which we own.
NIKE IHM, Inc. manufactures Air-Sole cushioning components at NIKE-
owned facilities located near Beaverton, Oregon and in St. Charles, Missouri.
We also manufacture and sell small amounts of various other plastic products
to other manufacturers through NIKE IHM, Inc.
Aside from the principal properties described above, we lease many offices
worldwide for sales and administrative purposes. We lease approximately
1,044 retail stores worldwide, which consist primarily of factory outlet stores.
See “United States Market” and “International Markets” in Part I of this Report.
Our leases expire at various dates through the year 2033.
ITEM 3. Legal Proceedings
There are no material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which we are a party or of which any of our
property is the subject.
ITEM 4. Mine Safety Disclosures
Not applicable.
NIKE, INC. 2016 Annual Report and Notice of Annual Meeting 69
FORM 10-K