As discussed in this chapter, managers are hired as agents to make decisions in the best interests of the owners. Often, employment contracts are put into place to help align the goals of managers and owners. For example, Nike, Inc. has implemented a variety of conditions within its executive compensation package. Below is an excerpt from DEF 14 A 1999 - 09 - 22 (the proxy statement) that Nike, Inc. filed with the Securities and Exchange Commission.

(1) The Compensation Plan Subcommittee established a series of performance targets based on fiscal 2000 and 2001 revenues and earnings per share corresponding to award payouts ranging from \(10 \%\) to \(150 \%\) of the target awards. Participants would have been entitled to a payout at the highest percentage level at which both performance targets are met, subject to the Committee's discretion to reduce or eliminate any award based on Company or individual performance. Under the terms of the awards, on August 15, 2000 and 2001 the Company would issue in the name of each participant a number of shares of Class B Stock with a value equal to the award payout based on the closing price of the Class B Stock on that date on the New York Stock Exchange. The shares would be restricted for three years thereafter and subject to forfeiture to the Company if the participant ceases to be an employee of the Company for any reason during such three-year period.

Required Identify the types of incentive packages used by Nike stockholders to align the goals of management with theirs.