EXHIBIT 4.5


 



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TERMS AND CONDITIONS OF THE NOKIA PERFORMANCE SHARE PLAN 2014


 



	
1. 

	
Purpose and Scope of the Plan







 


The purpose of the Nokia Performance Share Plan 2014 is to retain Nokia Group employees, to promote employees’ engagement and to reward them for Nokia Group’s long-term performance. This is accomplished by focusing the Participants on Nokia Group’s long-term financial performance and share price appreciation and thus aligning the interests of the Participants with those of the shareholders. To accomplish these objectives the Company may grant eligible Nokia Group employees Performance Shares under this Plan.







The Plan is tied directly to the performance of Nokia Group. For the purposes of this plan, performance is measured through the Performance Criteria. The financial benefits of the Plan materialize after the Restriction Period only if the pre-determined performance levels measured by Performance Criteria, are achieved by the end of the Performance Period, subject to the Minimum Amount.


 


Under the Plan a maximum of 14.85 million Performance Shares may be granted, which may result in the settlement of 29.7 million Shares at the maximum performance level. The Board determines the general guidelines under the Plan and approves the grants of Performance Shares to eligible employees within its authority. Grants of Performance Shares under these terms and conditions may be made between February 14, 2014 and December 31, 2014, inclusive.


 



	
2. 

	
Definitions







 


Board: The Board of Directors of the Company.


 


Company: Nokia Corporation


 


Grant Amount: The number of Performance Shares granted to a Participant.


 




  





  











  






 




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HERE Average Annual Non-IFRS Net Sales: The average of the annual non-IFRS net sales of HERE during the Performance Period.


 


HERE Non-IFRS Operating Profit: The non-IFRS profit earned from HERE during the Performance Period.


 


Maximum Number: The number of Performance Shares to be settled if the maximum performance is achieved with respect to the Performance Criteria as defined under section 4.2. The Maximum Number equals two times the Grant Amount. Maximum Number is tied to the Performance Criteria as defined in section 4.2.


 


Minimum Amount: a minimum pay-out which is 25% of the Grant Amount, payable only in the event that the calculated pay-out (based on Nokia’s performance against the Performance Criteria) is beneath 25% achievement against Performance Criteria.


 


NSN: Nokia Solutions and Networks B.V.


 


Nokia:  Nokia Corporation.


 


Nokia Average Annual Net Sales: Average Annual Net Sales is an average of the annual net sales in the consolidated profit and loss accounts for Nokia (non-IFRS) during the Performance Period.


 


Nokia Average Annual EPS: Average Annual EPS (diluted, non-IFRS) is an average of the annual earnings per share in the consolidated profit and loss accounts for Nokia Group (non-IFRS) during the Performance Period.


 


Nokia Group: The Company together with the companies over which the Company effectively exercises control and which are included in the consolidated financial statements of the Company.


 


Participant: Employee of Nokia Group who has received a grant of Performance Shares under the Plan.


 


Performance Criteria/Criterion: For the purposes of the Plan, performance is measured by each pre-determined criterion as set in section 4.2, together referred to as the Performance Criteria.


 




  





  











  






 




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Performance Share/Shares: Each Performance Share represents a right to receive a certain number of Shares or their cash equivalent upon settlement, subject to the fulfillment of the conditions under section 4, and provided that no other restriction related to these terms and conditions is applicable.


 


Performance Period: The two fiscal years starting on January 1, 2014 and ending on December 31, 2015.


 


Plan: Performance Share Plan 2014 of Nokia Group.


 


Restriction Period: Period after which the Shares shall be settled to the Participant. The Restriction Period shall be no less than one year from the end of the Performance Period.


 


Settlement Date: A banking day in Helsinki, Finland falling as soon as practicable after the end of the Restriction Period, as determined by the Company.


 


Share/Shares: The Company’s ordinary shares. The terms and conditions applicable to Shares shall apply to their cash equivalent used for settlement, as applicable.


 


Terms & Conditions: The terms and conditions of this Plan.


 


Threshold Number: The number of Performance Shares to be settled, if the threshold performance is achieved with respect to one Performance Criterion as defined under section 4.2, subject to the Minimum Amount.


 



	
3. 

	
Grant of Performance Shares







 


At grant, each Participant will receive a Grant Amount of Performance Shares. The Company will notify each Participant of the grant.


 


As a precondition for a valid grant, the Participant must be employed by Nokia Group at the time of the grant.


 




  





  











  






 




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The Participant may be required to give the Company such authorizations and consents, as the Company deems necessary in order to administer the Plan.


 



	
4. 

	
Financial Performance Criteria







 



	
4.1 

	
General Principles







 


Measurement of the performance during the Performance Period will be based on the Performance Criteria as of December 31, 2014 and 2015 compared to the pre-established performance level defined herein under section 4.2.


 




	
4.2.

	
Threshold Performance and Maximum Performance









 


Threshold performance levels and maximum performance levels are defined for each Performance Criterion in the tables below.


 


The number of Performance Shares to be settled is determined independently with respect to each applicable Performance Criterion, with the total final pay-out being subject to the Minimum Amount.







If no threshold performance is achieved in respect of a Performance Criterion, the Minimum Amount will be settled after the Restriction Period.







If the threshold performance level is achieved in respect of a Performance Criterion, the Threshold Number of Performance Shares will be settled after the Restriction Period, subject to the Minimum Amount.







To the extent the threshold performance level is exceeded in respect of a Performance Criterion, the number of Performance Shares to be settled after the Restriction Period will increase from the Threshold Number up to the Maximum Number following a predetermined linear scale based on actual financial performance achieved, subject to the Minimum Amount.


 




  





  











  






 




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The total number of Performance Shares to be settled may not exceed two times the Grant Amount.


 


The following table summarizes each Performance Criterion for the Nokia Group employees (excluding HERE employees):


 



	
Performance Criterion

	
Weighting

	
Threshold performance

	
Maximum Performance

	
Potential range of Settlement*


	
Nokia Average Annual Net Sales during Jan.1 2014-Dec. 31. 2015

	
50%

	
EUR 11.135 billion

	
EUR 15.065 billion

	
Threshold Number up to maximum level (4 x Threshold Number)


	
Nokia Average Annual EPS during Jan.1 2014-Dec. 31. 2015

	
50%

	
EUR 0.11

	
EUR 0.38

	
Threshold Number up to maximum level (4 x Threshold Number)












The following table summarizes each Performance Criterion for the HERE employees:








	
Performance Criterion

	
Weighting

	
Threshold performance

	
Maximum Performance

	
Potential range of Settlement*


	
Nokia Average Annual EPS during Jan.1 2014-Dec. 31. 2015

	
25%

	
EUR 0.11

	
EUR 0.38

	
Threshold Number up to maximum level (4 x Threshold Number)


	
HERE Non-IFRS Operating Profit during Jan.1 2014-Dec. 31. 2015

	
25%

	
EUR 0 million

	
EUR 130 million

	
Threshold Number up to maximum level (4 x Threshold Number)


	
HERE Average Annual Non-IFRS Net Sales during Jan.1 2014-Dec. 31. 2015

	
50%

	
EUR 950 million

	
EUR 1.150 billion

	
Threshold Number up to maximum level (4 x Threshold Number)







 



* The minimum pay-out of 25% of the Grant Amount, will be payable only in the event that the calculated pay-out (based on Nokia’s performance against the Performance Criteria) is beneath 25% achievement against the Performance Criteria.


 






  





  











  






 




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5. 

	
Measurement and Calculation of Pay-out







 


The measurement of the Performance Criteria shall be made after the end of the Performance Period and approved by the Personnel Committee of the Company’s Board of Directors. Based on this measurement, the number of Performance Shares to be settled as Shares or the equivalent amount of cash shall be calculated.


 


The Performance Criteria and final pay-out calculation applicable to each Participant will be based on the business unit in which the Participant is employed as at the end of the Performance Period.


 


The Company shall carry out the measurement and calculation in its sole discretion.


 


The calculation of the number of Performance Shares to be settled shall not result in fractional Shares. The number of Shares shall be rounded to the nearest whole Share.


 



	
6.

	
Restriction Period







 


The Shares shall be settled to the Participant after the end of the Restriction Period. The end of the Restriction Period shall be specified to the Participant in the grant communication.


 


During the Restriction Period, the Participant does not have any legal ownership or any other rights relating to the Shares. The Participant shall not be entitled to any dividend or have any voting rights or any other rights as a shareholder to the Shares until and unless the Shares have been transferred to the Participant and, in case of new Shares issued by the Company, until the Shares have been entered to the Trade Register.


 




  





  











  






 




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7. 

	
Settlement







 


On the Settlement Date, the Company will complete the settlement by transferring the applicable number of Shares or their cash equivalent to the Participant’s book-entry, brokerage or other bank account, as applicable, provided that the Participant has complied with these terms and conditions and performed all necessary actions to enable the Company to instruct the settlement. If the Participant has not performed all necessary actions to enable the Company to instruct the settlement, the Company may, in its sole discretion, sell the Shares on behalf of the Participant and remit the proceeds to the Participant.







The Company may, in its sole discretion, use for the settlement of Performance Shares one or more of the following: newly issued Shares, the Company’s own existing Shares (treasury Shares), Shares purchased from the open market, or, in lieu of Shares, cash.


 


The Participants shall not be entitled to any dividend or have any voting rights or any other shareholder rights until and unless the Shares have been transferred to the Participant and, in case of new Shares issued by the Company, until the Shares have been entered to the Trade Register.


 


8.         Changes in Employment


 


If the employment of the Participant with Nokia Group terminates prior to the end of the Restriction Period by the reason of retirement, permanent disability (as defined by the Company in its sole discretion) or death, the Participant retains the right to settlement. In case of death of the Participant prior to the end of the Performance Period, the Company has the right to settle the Performance Shares at the Grant Amount prior to the end of the Performance Period. In case of death of the Participant during the Restriction Period, the Company has the right to settle the Performance Shares prior to the end of the Restriction Period based on the calculation of the number of Performance Shares to be settled made in accordance with section 5 of these Terms & Conditions. If made, such special settlement will constitute full and final settlement of that Performance Share grant.


 




  





  











  






 




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If the employment of the Participant with Nokia Group terminates prior to the end of the Restriction Period for any other reason than those mentioned above, the Company is entitled to redeem the Performance Shares from the Participant without consideration, in which case the Participant shall not be entitled to any settlement under the Plan.


 


In cases of voluntary and/or statutory leave of absence of the Participant, the Company has the right to prorate the settlement.


 



	
9. 

	
Terms of Employment












The grant or settlement of Performance Shares does not constitute a term or a condition of the Participant’s employment contract with Nokia Group under applicable local laws. The Performance Shares, Shares or their cash equivalent under the Plan do not form a part of the Participant’s salary or benefit of any kind.








	
10. 

	
Taxes and other Obligations












The Participant is personally responsible for all taxes and social security charges associated with the Performance Share grants and Shares delivered upon settlement. This includes responsibility for any and all tax liabilities in multiple countries, if the Participant has resided in more than one country during the Performance Period and/or Restriction Period. Participants are advised to consult their own financial and tax advisers (at their own expense) before accepting the grant in order to verify their tax position.







The Participant is also personally responsible for any potential charges debited by financial institutions in connection with the settlement of the Performance Shares or any subsequent transactions related to the Shares.


 




  





  











  






 




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Pursuant to applicable laws, the Nokia Group is or may be required or may deem it appropriate to withhold taxes, social security charges or fulfill employment related and other obligations upon grant or settlement of Performance Shares, or when the Shares are disposed of by a Participant. The Nokia Group shall have the right to determine how such collection, withholding or other measures will be arranged or carried out, including but not limited to a settlement of a net amount remaining after the completion of such measures or a potential sale of the Shares on behalf of a Participant for the completion of such measures.








	
11. 

	
Breach of these Terms and Conditions












The Participant shall comply with these terms and conditions, as well as any instructions given by the Company regarding the Plan from time to time. If the Participant breaches these terms and conditions and/or any instructions given by the Company, the Company may in its discretion, at any time prior to settlement, rescind the grant of Performance Shares.








	
12. 

	
Validity of these Terms and Conditions







 


These terms and conditions shall become valid and effective upon the approval by the Board. The Board may, in its absolute discretion, at any time amend, modify or terminate these terms and conditions.







Such action by the Board may also, as in each case is determined by the Board affect the Performance Shares that are then outstanding, but not settled.








	
13. 

	
Administration







 


The Plan shall be administered by the Company in accordance with the general guidelines approved by the Board. The Company has the authority to interpret these terms and conditions, approve such other rules and procedures and take such other measures, as it deems necessary or appropriate for the administration of the Plan. Such action may also affect the Performance Share grants that are then outstanding, but not settled.







The Company has the right to determine the practical manner of administration and settlement of the Performance Shares, including but not limited to the acquisition, issuance, sale, and transfer of the Shares or their cash equivalent to the Participant. Furthermore, the Company has the right to require from the Participant the submission of such information or contribution that is necessary for the administration and settlement of the Performance Share grants.


 




  





  











  






 




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14.

	
Rights of Participants in certain Cases












14.1 Should the Annual General Meeting in accordance with the proposal of the Board decide, prior to the settlement of the Performance Shares, to distribute a special dividend constituting a deviation from the customary dividend policy of the Company, the Board will decide if and how the Participants will be compensated for the special dividend. Such distribution of special dividend can include, but is not limited to, a distribution of assets from reserves of unrestricted equity or distribution of share capital to the shareholders. The Board will specify in its proposal for the dividend whether the dividend, or a part of it, shall be considered a special dividend.







14.2 Should the Company, prior to the settlement of the Performance Shares, issue new shares, stock options or other special rights to all shareholders, the Board will in its sole discretion decide what the rights of the Participants will be in such cases.







14.3 The Company’s decision to cancel existing shares held by the Company prior to the settlement of the Performance Shares will not affect the settlement of Performance Shares nor the number of Performance Shares to be settled.







14.4. Should the Company, during the Performance Period, be placed into liquidation, the Company has the right to settle the Performance Shares at the Grant Amount within such time period as resolved by the Board. Notwithstanding any other provisions in these terms and conditions, should the Company, prior to the settlement of the Performance Shares, be deregistered from the Trade Register, the Participants shall not have any right to settlement.


 




  





  











  






 





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14.5. Should the Company, during the Performance Period, resolve to merge with another existing company or merge with a company to be formed, or should the Company resolve to be demerged, the Company has the right to settle the Performance Shares at the Grant Amount prior to the merger or demerger or to convert the Performance Shares into similar equity rights issued by the other company on such terms and within such a time period, as resolved by the Board. Notwithstanding any other provisions in these terms and conditions, following the closing of the merger or demerger, the Participants shall have no right to settlement under this Plan. The same also applies to a merger, in which the Company takes part, and whereby the Company registers itself as a European Company (Societas Europae) in another member state in the European Economic Area or, if the Company after registering itself into a European Company registers a transfer of its domicile into another member state.







14.6. Should the Company, during the Performance Period, make a resolution to acquire its own shares through a tender offer to all the shareholders, the Company shall make an equal offer to the Participants in respect of Performance Shares to settle the Performance Shares at the Grant Amount. If the Company acquires or redeems its own shares in any other manner, or if the Company acquires stock options or other special rights entitling to shares,  no measures will need to be taken in relation to this Plan.







14.7. Should during the Performance Period a tender offer regarding all shares and stock options issued by the Company be made or should a shareholder under the Articles of Association of the Company or the Finnish Securities Markets Act have the obligation to redeem the shares from the Company’s other shareholders, or to redeem the stock options, or should a shareholder have under the Finnish Companies Act the right and obligation to redeem the shares from the Company’s other shareholders, then the Company has the right to settle the Performance Shares at the Grant Amount prior to the tender offer or the offer to redeem the shares, as resolved by the Board.


 




  





  











  






 




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Should a shareholder under the Finnish Companies Act have the right to redeem the shares from the Company’s other shareholders, the Company has the right, during the Performance Period, to settle the Performance Shares at the Grant Amount prior to the redemption, as resolved by the Board, after which the Participants’ obligation to transfer all of their shares will be subject to the Finnish Companies Act.







The Board may, however, in any of the situations resolved in this section 14.7, also give the Participants an opportunity to convert their Performance Shares into equity-based incentives issued by another company on such terms and within such time period prior to the completion of the tender offer or redemption, as resolved by the Board.







14.8. Should the Company during the Performance Period be delisted from NASDAQ OMX Helsinki or its successors, the Company has the right to settle the Performance Shares at the Grant Amount prior to the delisting and make other amendments to these terms and conditions as resolved by the Board.







14.9. Sections 14.4, 14.5, 14.6, 14.7 and 14.8 shall also apply should the situations set out in those sections take place during the Restriction Period, with the exception that instead of Grant Amount, the Company has the right to settle the Performance Shares based on the calculation of the number of Performance Shares to be settled made in accordance with section 5 of these Terms & Conditions.








	
15.

	
The Recoupment of Equity Gains in the Event of Certain Restatements












Under the Nokia Policy on the recoupment of equity gains (“Nokia Policy”), as amended from time to time, in the event of certain restatements, if any of Nokia Group’s financial statements are required to be restated as a result of fraud or intentional misconduct, the Board may, in its discretion and at any time, resolve to recover or require reimbursement of all or a portion of any gains realized in accordance with the terms and conditions set forth in the Nokia Policy.


 




  





  











  






 




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16. 

	
Governing Law and Settlement of Disputes







 


These terms and conditions are governed by Finnish laws. Disputes arising out of these terms and conditions shall be settled by arbitration in Helsinki, Finland, in accordance with the Arbitration Rules of the Finnish Central Chamber of Commerce.








	
17. 

	
Processing of personal data







 


Nokia Group has the right to transfer globally within Nokia Group and/or to an agent of Nokia Group any of the personal data required for the administration of the Plan and the settlement of the Performance Shares. The personal data may be administered and processed by Nokia Group or its authorized agent in the future. The Participant is entitled to request access to data referring to the Participant’s person, held by Nokia Group or its agent and to request amendment or deletion of such data in accordance with applicable laws, statutes or regulations. In order to exercise these rights, the Participant must contact Nokia Legal and Intellectual Property, in Espoo, Finland.