Nokia 2010 Annual Report Download - page 150

Other Equity Plans for Employees
In addition to our global equity incentive plans described above, we have equity plans for
Nokiaacquired businesses or employees in the United States and Canada under which participants
can receive Nokia ADSs or ordinary shares.
In connection with our July 10, 2008 acquisition of NAVTEQ, the Group assumed NAVTEQ’s 2001 Stock
Incentive Plan (“NAVTEQ Plan”). All unvested NAVTEQ restricted stock units under the NAVTEQ Plan
were converted to an equivalent number of restricted stock units entitling their holders to Nokia
shares. The maximum number of Nokia shares to be delivered to NAVTEQ employees during the years
20082012 is approximately 3 million, of which approximately 2 million shares have already been
delivered by December 31, 2010. The Group does not intend to make further awards under the
NAVTEQ Plan.
We have also an Employee Share Purchase Plan in the United States, which permits all fulltime Nokia
employees located in the United States to acquire Nokia ADSs at a 15% discount. The purchase of the
ADSs is funded through monthly payroll deductions from the salary of the participants, and the ADSs
are purchased on a monthly basis. As of December 31, 2010, approximately 12.8 million ADSs had
been purchased under this plan since its inception, and there were a total of approximately 550
participants in the plan.
For more information on these plans, see Note 24 to our consolidated financial statements included
in Item 18 of this annual report.
Nokia EquityBased Incentive Program 2011
On January 27, 2011, the Board of Directors approved the scope and design of the Nokia Equity
Program 2011, subject to the approval of the Stock Option Plan 2011 by the Annual General Meeting.
Similarly, like the earlier broadbased equity incentive programs, it intends to align the potential
value received by the participants directly with the longterm financial performance of the Company,
thus also aligning the participants’ interests with Nokia shareholders’ interests. Nokia’s balanced
approach and use of the performancebased plan as the main longterm incentive vehicle effectively
contribute to the longterm value creation and sustainability of the Company and ensure that
compensation is based on performance.
The main equity instrument continues to be performance shares. In addition, stock options will be
used in conjunction with performance shares on a limited basis for senior managers, and restricted
shares will be used on a very selective basis for high potential and critical talent, vital to the future
success of Nokia. These equitybased incentive awards are generally forfeited if the employee leaves
Nokia prior to vesting.
Performance Shares
The Performance Share Plan 2011 approved by the Board of Directors will cover a performance period
of three years (20112013). No performance shares will vest unless Nokia’s performance reaches at
least one of the threshold levels measured by two independent, predefined performance criteria:
(1)
Average Annual Net Sales Growth : 2.5% (threshold) and 10% (maximum) during the performance
period 20112013, and
(2)
Average Annual EPS (diluted, nonIFRS) : EUR 0.50 (threshold) and EUR 1.10 (maximum) during the
performance period 20112013.
Average Annual Net Sales Growth is calculated as an average of the net sales growth rates for the
years 2011 through 2013. Average Annual EPS is calculated as an average of the diluted, nonIFRS
earnings per share for years 2011, 2012 and 2013. Both the Average Annual Net Sales Growth and the
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