Nokia 2010 Annual Report Download - page 248

24. Sharebased payment (Continued)
The options outstanding by range of exercise price at December 31, 2010 are as follows:
Exercise prices EUR Number of shares
Weighted average
remaining
contractual life
in years
Weighted
average
exercise
price EUR
Options outstanding
0.949.82 .................................... 6201937 5.00 8.66
10.1114.99 .................................. 4973503 3.78 11.46
15.3719.16 .................................. 10681907 1.61 18.28
19.4327.53 .................................. 87949 1.70 23.96
21 945 296
Nokia calculates the fair value of stock options using the BlackScholes model. The fair value of the
stock options is estimated at the grant date using the following assumptions:
2010 2009 2008
Weighted average expected dividend yield ...... 4.73% 3.63% 3.20%
Weighted average expected volatility .......... 52.09% 43.46% 39.92%
Riskfree interest rate ....................... 1.52%  2.49% 1.97%  2.94% 3.15%  4.58%
Weighted average riskfree interest rate ........ 1.78% 2.23% 3.65%
Expected life (years) ........................ 3.59 3.60 3.55
Weighted average share price, EUR ............ 8.27 10.82 16.97
Expected term of stock options is estimated by observing general option holder behavior and actual
historical terms of Nokia stock option plans.
Expected volatility has been set by reference to the implied volatility of options available on Nokia
shares in the open market and in light of historical patterns of volatility.
Performance shares
During 2010, Nokia administered four global performance share plans, the Performance Share Plans of
2007, 2008, 2009 and 2010, each of which, including its terms and conditions, has been approved by
the Board of Directors.
The performance shares represent a commitment by Nokia Corporation to deliver Nokia shares to
employees at a future point in time, subject to Nokia’s fulfillment of predefined performance criteria.
No performance shares will vest unless the Group’s performance reaches at least one of the threshold
levels measured by two independent, predefined performance criteria: the Group’s average annual
net sales growth for the performance period of the plan and earnings per share (“EPS”) at the end of
the performance period.
The 2007, 2008, 2009 and 2010 plans have a threeyear performance period with no interim payout.
The shares vest after the respective performance period. The shares will be delivered to the
participants as soon as practicable after they vest. Until the Nokia shares are delivered, the
participants will not have any shareholder rights, such as voting or dividend rights associated with
the performance shares. The performance share grants are generally forfeited if the employment
relationship terminates with Nokia prior to vesting.
F60
Notes to the Consolidated Financial Statements (Continued)