The Board of Directors of Nike, Inc. is reporting that Elliott Hill will become president and CEO of Nike, Inc., effective October 14, 2024. Hill will also become a director of the Nike, Inc. Board of Directors and a member of the Executive Committee.

“I am excited to welcome Elliott back to Nike,” said Mark Parker, executive chairman of Nike, Inc. “Given our needs for the future, the past performance of the business, and after conducting a thoughtful succession process, the Board concluded it was clear Elliott’s global expertise, leadership style, and deep understanding of our industry and partners, paired with his passion for sport, our brands, products, consumers, athletes, and employees, make him the right person to lead Nike’s next stage of growth. Personally, I have worked with Elliott for more than 30 years and I look forward to supporting him and his senior management team as they seize the opportunities ahead.”

The company said in media release that the Nike, Inc. Board and John Donahoe have decided he will retire from his role as president and CEO and from the Nike, Inc. Board of Directors effective October 13. He will remain as an advisor to the company to ensure a smooth transition through January 31, 2025.

“I would like to thank John for his contributions to Nike as president and CEO, and as a board member. I would particularly like to recognize the role he played in leading the company during the COVID pandemic and his unwavering support for the investments Nike has made in our communities around the world,” added Parker.

“Nike has always been a core part of who I am, and I’m ready to help lead it to an even brighter future,” said Elliott Hill. “For 32 years, I’ve had the privilege of working with the best in the industry, helping to shape our company into the magical place it is today “I’m eager to reconnect with the many employees and trusted partners I’ve worked with over the years, and just as excited to build new, impactful relationships that will move us ahead. Together with our talented teams, I look forward to delivering bold, innovative products, that set us apart in the marketplace and captivate consumers for years to come.”

Nike said that throughout the course of his career at the company, Hill held senior leadership positions across Europe and North America and was responsible for helping grow the business to more than $39 billion.

Prior to his retirement, Hill was president, consumer and marketplace, leading all commercial and marketing operations for Nike and Jordan Brand, including the P&L across the company’s four geographies. He retired from Nike in 2020.

Hill, who is 60 years of age, has been the founder and owner of Open Road Resources, LLC since 2020, through which he has served as an operating partner of BDT & MSD Partners since 2023, and as a senior advisor to BDT Capital from 2020 to 2023. Hill is a graduate of Texas Christian University (TCU) and Ohio University and currently serves on the Board of Trustees for TCU.

The company filed an 8-K with the SEC on September 19, detailing that it entered into an Offer Letter with Hill establishing his compensation as president and CEO. Under the Offer Letter, Hill’s compensation as president and CEO will comprise an annual base salary of $1.5 million; a target annual bonus of 200 percent of base salary (prorated for the company’s fiscal year ending May 31, 2025, based on the company’s standard methodology); and an annual target long-term incentive award of $15.5 million.

The company said the incoming CEO’s annual long-term incentive award for the company’s 2025 fiscal year will be granted as soon as practicable October 14 and comprise 50 percent performance-based restricted stock units (PSUs), 35 percent stock options and 15 percent restricted stock units (RSUs). Consistent with the terms of the company’s 2025 fiscal year grants to other executive officers, generally PSUs will vest based on the company’s stock price performance over a three-year performance period, stock options will vest one-quarter (25 percent) per year on the anniversary of the date of grant, and RSUs will vest one-quarter (25 percent) per year on the anniversary of the date of grant.

In addition, in order to make the incoming CEO whole for certain forfeited compensation from his prior roles, the company said Hill will receive certain one-time equity and cash awards as soon as reasonably practicable following October 14, as follows:

  • A one-time RSU award with a target grant value of $3.0 million (New Hire RSU Award). The New Hire RSU Award will vest one-third (33.33 percent) per year on the anniversary of the grant date.
  • A one-time cash payment equal to $4.0 million (New Hire Cash Award) payable in connection with his commencement of employment. If, within two years following October 14, 2024, Hill voluntarily resigns from employment with the company or is unable to continue working for the company as a result of being subject to a non-compete agreement that prohibits him from working for the company, he will be required to repay the full amount of the New Hire Cash Award.

“Mr. Hill will be eligible to participate in the company’s employee benefit plans and programs applicable to senior executives of the company generally, as may be in effect from time to time, including, without limitation, participation in the company’s Relocation Policy (generally, with recognition for his prior service with the company),” the company detailed in the filing.

“As part of standard compensation and benefit arrangements for senior executives, the company and Mr. Hill have entered into an agreement containing a covenant not to compete (the “Hill RCA”) that will extend for eighteen months following the termination of his employment with the company. The Hill RCA provides that, if Mr. Hill’s employment is terminated by the company without cause (as defined in the Hill RCA) at any time, the company will make monthly payments to him during the eighteen-month non-competition period in an amount equal to one-twelfth of his current annual base salary and target bonus,” the filing continued.”

The company also noted that the Hill RCA provides further that, if the new CEO voluntarily resigns at any time, the company will make monthly payments to him during the eighteen-month non-competition period in an amount equal to one-twenty fourth of his current annual base salary and target bonus. The company may waive the covenant with the consent of Hill, unless he is terminated by the company for cause (as defined in the Hill RCA), in which case, the company may unilaterally waive the covenant. If the covenant is waived, the company will not be required to make the payments described above for the months as to which the waiver applies.

As for Donohue, the company on September 19 entered into a letter agreement with the outgoing CEO (the “Letter Agreement”), pursuant to which (1) he will continue to serve as president and CEO of the company until the October 13, and (2) as of October 13, he will resign from the Board and any other director, officer, manager, committee member or other positions that he holds with the company and its subsidiaries (including the Executive Committee of the Board) and begin serving as advisor to the company.

Donahoe will reportedly remain a full-time non-executive employee of the company in that role through January 31, 2025 (Retirement Date). Donahoe’s outstanding equity awards will continue to vest in accordance with their terms through the Retirement Date, subject to his compliance with certain release requirements, and Donahoe’s annual base salary and employee benefit plan eligibility will remain unchanged through the Retirement Date.

The company wrote, “The Covenant Not to Compete and Non-Disclosure Agreement, dated October 17, 2019 (the “Noncompetition Agreement”), by and between the company and Mr. Donahoe, will remain in full force and effect pursuant to its terms, and the Restriction Period (as defined in the Noncompetition Agreement) thereunder will commence on the Retirement Date, such that Mr. Donahoe will be eligible to receive the benefits payable under the Noncompetition Agreement upon a voluntary termination of employment.”

Donahoe reportedly received a salary of $1.6 million and incentive pay of $2 million for fiscal 2024 ended May 31.

The bulk of his compensation reportedly came in the form of stock and option awards, which were valued at a combined $19.2 million when they were first granted. As is standard the full value of the awards will be determined by how Nike shares perform over time until his vesting ends January 31, 2025.

“It’s been an honor and privilege to be part of this incredible company, and I’ll always value my time at Nike and the opportunity to lead the organization. I have great respect for Phil, Mark, Nike and its employees,” said John Donahoe. “It became clear now was the time to make a leadership change, and Elliott is the right person. I look forward to seeing Nike and Elliott’s future successes.”

Images courtesy Nike, Inc.