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EXHIBIT 4.3
TERMS AND CONDITIONS OF THE NOKIA PERFORMANCE SHARE PLAN 2006
1.
Purpose and Scope of the Plan
The purpose of this Plan is to retain Nokia employees on a
long-term basis, to promote employee's long-term commitment,
and to compensate them for performance measured on a long-term
basis.
The Plan is tied directly to the performance of Nokia Group.
For the purposes of this Plan, the performance is measured
through growth and profitability. The compensation to the
employees under the Plan becomes payable and the financial
benefits of the Plan be materialized only provided that the
pre-determined performance level, measured by Average Annual
Net Sales Growth and EPS growth, is achieved by the end of the
Performance Period.
Various different instruments may be used for the Settlement
under the Plan, including also Nokia Shares. Settlement by
using Nokia Shares is to promote ownership of Nokia Shares by
Nokia employees, and to further align the interests of the
employees with those of the shareholders.
The Plan may result to a grant of a maximum of 32,600,000
Nokia Shares. The Personnel Committee determines the grant
guidelines under the Plan, as well as approves the grants,
within its authorities. Grants may be used to recruit, retain
and motivate selected personnel of Nokia Group.
2. Definitions
Average Annual Net Sales Growth: The Average Annual Net Sales
Growth is an average of the annual net sales growth rates in
the consolidated financial accounts for Nokia Group (IFRS)
during the Performance Period. The Average Annual Net Sales
Growth is one of the two pre-determined financial performance
criteria under the Plan.
Board: Board of Directors of Nokia Corporation.
EPS: Earnings per share (basic, reported) in the consolidated
financial accounts for Nokia Group (IFRS). The EPSs relevant
for this Plan are that for the fiscal year of 2005 and of
2008. EPS growth is one of the two pre-determined financial
performance criteria under the Plan.
Grant Amount: The number of Performance Shares granted to a
Participant. One half of the Grant Amount is the Threshold
Number tied to the EPS growth, and the other half is the
Threshold Number tied to the Average Annual Net Sales Growth.
Grant Amount equals the total of the two Threshold Numbers.
Nokia: Nokia Corporation.
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Maximum Number: The number of Performance Shares subject to
the Settlement, if the Maximum Performance is achieved. The
Maximum Number will be determined separately for both of the
performance criteria and it equals four times the Threshold
Number of each performance criterion.
Maximum Performance: The maximum performance level defined for
both performance criteria independently under paragraph 4.2.
Participant: Employees of Nokia Group who have received a
grant of Performance Shares under the Plan.
Performance Shares: The Grant Amount consists of Performance
Shares. Each Performance Share includes a right to receive one
Share or a cash equivalent upon the Settlement, if the
conditions under paragraph 4 are met, and no other
restrictions under these Plan Rules are applicable.
Performance Shares are Shares after the Settlement.
Personnel Committee: Personnel Committee of the Board of
Directors of Nokia.
Performance Period: Three fiscal years starting on January 1,
2006
through December 31, 2008.
Plan: Performance Share Plan 2006 of Nokia Corporation.
Plan Rules: This document as approved by the Board of
Directors.
Settlement: Payment of Shares, or the equivalent in cash, to
the Participants. Nokia may, at its sole discretion, use for
the Settlement one or more of the ways of funding described
under paragraph 6, including cash settlement. Depending on the
way of funding, the Settlement will consist of a transfer and
delivery of a number of Shares to the Participant's
book-entry, brokerage or other account, or a transfer and
delivery of the cash equivalent to the Participant's cash
account.
Settlement Date: A banking day in Helsinki, Finland, that is
as soon as practicable after the end of the Performance
Period, as determined by Nokia. The Settlement Date cannot be
earlier than the first banking day immediately following the
day of the announcement of Nokia's annual results for the
fiscal year 2008.
Share/Shares: Nokia ordinary shares with a par value of EUR
0.06. What is said about Shares under these Plan Rules, is
applicable 'mutatis mutandis' to their cash equivalent.
Threshold Number: The number of Performance Shares to be
settled, if the Threshold Performance is achieved with respect
to at least one of the performance criteria. The Threshold
Number equals one half of the Grant
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Amount. One Threshold Number is tied to the EPS growth, and
another is tied to the Average Annual Net Sales Growth.
Threshold Performance: The minimum performance level resulting
in Settlement. Threshold Performance is defined for both of
the performance criteria independently.
3. Grant of Performance Shares
At grant, each Participant will receive a Grant Amount of
Performance Shares.
As precondition for a valid grant, the Participant may be
required to give Nokia such authorizations and consents, as
Nokia deems necessary in order to administer the Plan.
4. Financial Performance Criteria
4.1 General Principles and Frames
Measurement of Nokia's performance during the Performance
Period will be based on the consolidated financial accounts of
Nokia Group (IFRS) as of December 31, 2008, compared to the
consolidated financial accounts of Nokia Group (IFRS) for
2005.
If the Threshold Performance for neither of the two
performance criteria is reached, no Settlement will take
place.
To the extent the Threshold Performance level is achieved or
exceeded as to at least one of the performance criteria, the
number of Performance Shares to be settled will increase
linearly from the Threshold Number up to the Maximum Number.
The total amount of Performance Shares to be settled, if
applicable, may not exceed four times the Grant Amount.
4.2. Threshold Performance and Maximum Performance
The two independent performance criteria are as follows:
(a) Average Annual Net Sales Growth during the Performance
Period: 5% (threshold) and 20% (maximum); and
(b) EPS growth: EPS of EUR 0.96 (threshold) and EUR 1.41
(maximum) in 2008.
The performance will be measured independently for both of
these two performance criteria, which means that the number of
Performance Shares subject to the Settlement, if any, is
determined independently with respect to
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(a) the part of the Grant Amount tied to the Average Annual
Net Sales Growth and (b) with respect to the part of the Grant
Amount tied to the EPS growth.
The following table summarizes each performance criterion:
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Financial Accounts Performance Period
Performance Criterion Threshold
Maximum
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