Nokia 2010 Annual Report Download - page 149

the CEO are approved by the Personnel Committee. Performance share grants to eligible employees
are approved by the CEO at the end of the respective calendar quarter on the basis of an
authorization given by the Board of Directors.
Stock Options
During 2010 we administered two global stock option plans, the Stock Option Plan 2005 and 2007,
each of which, including its terms and conditions, has been approved by the Annual General Meetings
in the year when the plan was launched.
Each stock option entitles the holder to subscribe for one new Nokia share. The stock options are
nontransferable and may be exercised for shares only. All of the stock options have a vesting
schedule with 25% of the options vesting one year after grant and 6.25% each quarter thereafter. The
stock options granted under the plans generally have a term of five years.
The exercise price of the stock options is determined at the time of grant, on a quarterly basis, in
accordance with a preagreed schedule after the release of Nokia’s periodic financial results. The
exercise prices are based on the trade volume weighted average price of a Nokia share on NASDAQ
OMX Helsinki during the trading days of the first whole week of the second month of the respective
calendar quarter (i.e., February, May, August or November). Exercise prices are determined on a
oneweek weighted average to mitigate any dayspecific fluctuations in Nokia’s share price. The
determination of exercise price is defined in the terms and conditions of the stock option plan, which
are approved by the shareholders at the respective Annual General Meeting. The Board of Directors
does not have the right to change how the exercise price is determined.
Shares will be eligible for dividend for the financial year in which the share subscription takes place.
Other shareholder rights will commence on the date on which the subscribed shares are entered in
the Trade Register. The stock options grants are generally forfeited if the employment relationship
terminates with Nokia.
Stock option grants to the CEO are made upon recommendation by the Personnel Committee and are
approved by the Board of Directors and confirmed by the independent directors of the Board. Stock
option grants to the other Nokia Leadership Team members and other direct reports of the CEO are
approved by the Personnel Committee. Stock option grants to eligible employees are approved by the
CEO on a quarterly basis, on the basis of an authorization given by the Board of Directors.
Restricted Shares
During 2010 we administered four global restricted share plans, the Restricted Share Plan 2007, 2008,
2009 and 2010, each of which, including its terms and conditions, has been approved by the Board of
Directors.
Restricted shares are used to recruit, retain, and motivate selected high potential and critical talent
who are vital to the future success of Nokia. Restricted shares are used only for key management
positions and other critical talent.
All of our restricted share plans have a restriction period of three years after grant. Until the Nokia
shares are delivered, the participants will not have any shareholder rights, such as voting or dividend
rights, associated with the restricted shares. The restricted share grants are generally forfeited if the
employment relationship terminates with Nokia prior to vesting.
Restricted share grants to the CEO are made upon recommendation by the Personnel Committee and
approved by the Board of Directors and confirmed by the independent directors of the Board.
Restricted share grants to the other Nokia Leadership Team members and other direct reports of the
CEO are approved by the Personnel Committee. Restricted share grants to eligible employees are
approved by the CEO at the end of the respective calendar quarter on the basis of an authorization
given by the Board of Directors.
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