Nokia announced today that its Board of Directors has approved the
Nokia's equity program for 2016 (the "Equity Program 2016"). In
line with previous years, the Nokia Equity Program 2016 includes
the following equity instruments:
- An employee share purchase plan for Nokia employees in selected
jurisdictions (the "Employee Share Purchase Plan"), entitling the
eligible employees to contribute a part of their salary to purchase
Nokia shares. After a 12-month holding period, Nokia will offer the
employees one matching share for every two purchased shares held by
the an employee at the end of the holding period;
- Performance shares, which are dependent on the achievement of
independent performance criteria ("Performance Share"); and
- Restricted shares, which are used on a limited basis or in
exceptional retention and recruitment circumstances ("Restricted
Shares").
Nokia Equity Program 2016 The Equity Program 2016 is
designed to support and align the participants' focus with Nokia's
strategy and long-term success. Employees of Alcatel-Lucent, who
have transferred to Nokia as part of the acquisition of
Alcatel-Lucent, are also eligible to participate in the Equity
Program 2016.
Nokia uses Performance Shares as the main long-term incentive
vehicle with the intention of effectively contributing to the
long-term value creation and sustainability of the company and to
align interests of the employees with those of Nokia's
shareholders. Performance Shares are also designed to ensure that
the overall equity-based compensation is based on performance,
while also supporting the recruitment and ensuring retention of
vital talent for the future success of Nokia.
Restricted Shares are granted on a limited basis for exceptional
purposes related to retention and recruitment, primarily in the
United States, to ensure Nokia is able to retain and recruit vital
talent for the future success of the company.
Since 2014, stock options have no longer been part of the Nokia
Equity Programs.
Employee Share Purchase Plan Under the Employee Share
Purchase Plan, the eligible Nokia employees may elect to make
monthly contributions from their net salary to purchase Nokia
shares. Participation in the plan is voluntary.
The annual minimum and maximum contribution limit to the
Employee Share Purchase Plan is EUR 180 and EUR 1 200,
respectively. Generally, the share purchases will be made at market
value on pre-determined dates on a monthly basis during a 12-month
period. In October 2017, Nokia intends to deliver one matching
share for every two purchased shares that the participant still
holds on July 31, 2017, which marks the end of the Employee Share
Purchase Plan cycle for 2016. The aggregate maximum amount of
contributions that employees can make during the enrolment window
for the plan cycle commencing in 2016 will be approximately EUR 60
million, which equals approximately 11 494 253 Nokia shares using
the February 8, 2016 Nokia closing price of EUR 5.22 on Nasdaq
Helsinki. Based on the matching ratio of one matching share for
every two purchased shares, the number of matching shares would be
approximately 5 747 126. In addition, to welcome employees of
Alcatel-Lucent who have transferred to Nokia as part of the
acquisition of Alcatel-Lucent and to mark the beginning of the new
Nokia Group, Nokia intends to offer 20 free shares for every
participant making the first three consecutive share purchases in
2016.
The Employee Share Purchase Plan is planned to be offered to
Nokia employees in up to 54 countries for the plan cycle commencing
in 2016. The savings period is intended to start in July 2016 and
the first monthly purchases are planned to be made in August
2016.
Performance Shares Under the Performance Share plan,
target pay-out will depend on whether independent performance
criteria have been met by the end of the performance period. The
performance criteria are Nokia's continuing operations average
annual non-IFRS net sales and average annual non-IFRS earnings-per
share (diluted).
The Performance Share plan of 2016 has a two-year performance
period (2016-2017) and a subsequent one-year restriction period.
The number of Performance Shares to be settled after the
restriction period will start at 25 per cent of the grant amount
and any pay-out beyond this will be determined with reference to
the financial performance during the two-year performance period.
The grant under the Performance Share plan could result in an
aggregate maximum pay-out of 51 million Nokia shares, in the event
that maximum performance against all the performance criteria is
achieved.
Restricted Shares The Restricted Shares under the 2016
Restricted Share plan are divided into three tranches, each tranche
consisting of one third of the Restricted Shares granted. The first
tranche has a one-year restriction period, the second tranche a
two-year restriction period, and the third tranche a three-year
restriction period. The grant of Restricted Shares in 2016 could
result in an aggregate maximum payout of 1 350 000 Nokia
shares.
Employees covered by the Equity Program 2016 In
accordance with the previous year's practice, the primary equity
instruments granted to executive employees and directors below the
executive level are Performance Shares.
Nokia limits the use of Restricted Shares as means of
compensation. However, to support the specific needs, practices and
competitive market environment in the United States, restricted
shares may be used, in conjunction with the use of performance
shares, on a limited basis in the United States.
In addition, shares under the Restricted Share plan can be
granted for exceptional retention or recruitment purposes, aimed
primarily at US markets, to ensure Nokia is able to retain and
recruit vital talent for the future success of Nokia.
Nokia employees in up to 54 countries are planned to be offered
the possibility to participate in the Employee Share Purchase Plan
for the cycle commencing in 2016, provided that there are no local
regulatory or administrative restraints in relation to such
plan.
Employees of Alcatel-Lucent who have transferred to Nokia as
part of the acquisition of Alcatel-Lucent are included in equity
plans under the Equity Program 2016.
Dilution effect On February 10, 2016, Nokia announced the
final results of its subsequent offer period for outstanding
Alcatel-Lucent securities. As of February 12, 2016, subject to and
following the registration of new Nokia shares issued as
consideration for the Alcatel-Lucent securities tendered into the
subsequent French and/or U.S. offers, and consequently, included in
the aggregate amount of Nokia shares, the aggregate maximum
dilution effect of Nokia's currently outstanding equity programs,
assuming that the Performance Shares would be delivered at maximum
level, is approximately 0.86 per cent. The potential maximum
dilution effect of the Equity Program 2016 would approximately be
an additional 1.04 per cent, assuming delivery at maximum level for
Performance Shares and the delivery of matching shares against the
maximum amount of contributions of approximately EUR 60 million
under the Employee Share Purchase Plan. Employees of Alcatel-Lucent
that have transferred as part of the acquisition of Alcatel-Lucent
are only included in equity plans under the Equity Program
2016.
Issuance of Nokia shares for settlement of various Nokia
equity plans The performance period for the 2014 Performance
Share Plan ended on December 31, 2015, and Nokia's performance over
2014 and 2015, assessed against the independent performance
criteria set out in the plan rules, was above the threshold
performance level for the plan. The settlement to the participants
under the plan is planned to take place after the restriction
period ends on January 1, 2017.
To fulfill Nokia's obligations under the 2012, 2013 and 2015
Restricted Share Plans as well as the 2013 Performance Share Plan
in respect of shares to be settled in 2016, Nokia's Board of
Directors has resolved to issue, without consideration, a total of
1 657 000 Nokia shares held by the company to settle its
commitments to plan participants, who are all employees of the
Nokia Group.
Issuance of Nokia shares to beneficiaries of Alcatel-Lucent
employee equity compensation arrangements In accordance with
the Memorandum of Understanding dated April 15, 2015 between Nokia
and Alcatel-Lucent, as amended, Nokia has entered into liquidity
agreements with beneficiaries of Alcatel-Lucent employee equity
compensation arrangements who accepted to subscribe for the
liquidity program for the exchange of their Alcatel Lucent shares
resulting from Alcatel-Lucent equity instruments that they hold for
Nokia shares in certain circumstances.
To fulfill Nokia's obligations under the aforementioned
agreements, Nokia's Board of Directors has resolved, pursuant to
the share issue authorization granted by the Extraordinary General
Meeting of Nokia on December 2, 2015, to issue a maximum amount of
400 000 Nokia shares held by the company in the course of 2016
against contribution in kind in the form of the Alcatel-Lucent
shares being exchanged for the Nokia shares. The exchange ratio
applied in such exchanges is the same as the exchange ratio applied
in Nokia's public exchange offer for Alcatel-Lucent securities,
subject to certain adjustments in the event of certain financial
transactions by Nokia or Alcatel-Lucent.
About Nokia Nokia is a global leader in the technologies
that connect people and things. Powered by the innovation of
Bell Labs and Nokia Technologies, the company is at the
forefront of creating and licensing the technologies that
are increasingly at the heart of our connected
lives.
With state-of-the-art software, hardware and services for any
type of network, Nokia is uniquely positioned to help
communication service providers, governments, and large
enterprises deliver on the promise of 5G, the Cloud and the
Internet of Things. www.nokia.com
ENQUIRIES
Media Enquiries: Nokia Communications Tel. +358 (0) 10 448 4900
Email: press.services@nokia.com
Investor Enquiries: Nokia Investor Relations Tel. +358 4080 3
4080 Email: investor.relations@nokia.com
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN
PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT
JURISDICTION
FORWARD-LOOKING STATEMENTS
This stock exchange release contains forward-looking statements
that reflect Nokia's current expectations and views of future
events and developments. Some of these forward-looking statements
can be identified by terms and phrases such as "plan", "intend",
"may", "will", "would" and similar expressions. These
forward-looking statements include statements relating to: the
employees eligible for the Employee Share Purchase Plan; the
financial terms of the Employee Share Purchase Plan, including the
purchase price, aggregate total amount and Nokia's planned matching
and other incentives; the timeline of the Employee Share Purchase
Plan; the terms and conditions of the Performance Share Plan; the
dilutive effect of the share issuances in connection with the
equity plans; the details surrounding the settlement of the various
outstanding Nokia equity plans and the number of shares to be
issued in connection with the Alcatel-Lucent employee equity
compensation arrangement. These forward-looking statements are
subject to a number of risks and uncertainties, many of which are
beyond our control, which could cause actual results to differ
materially from such statements. These forward-looking statements
are based on our beliefs, assumptions and expectations of future
performance, taking into account the information currently
available to us. These statements are only predictions based upon
our current expectations and views of future events and
developments. Risks and uncertainties include: the number of
employees who will participate in the equity plans; Nokia's share
price; the performance of the global economy; the capacity for
growth in internet and technology usage; the consolidation and
convergence of the industry, its suppliers and its customers; the
effect of changes in governmental regulations; disruption from the
transaction making it more difficult to maintain relationships with
customers, employees or suppliers; and the impact on the combined
company (after giving effect to the transaction with Alcatel
Lucent), of any of the foregoing risks or forward-looking
statements, as well as other risk factors listed from time to time
in Nokia's and Alcatel Lucent's filings with the U.S. Securities
and Exchange Commission ("SEC").
The forward-looking statements should be read in conjunction
with the other cautionary statements that are included elsewhere,
including the Risk Factors section of the Registration Statement
(as defined below), Nokia's and Alcatel Lucent's most recent annual
reports on Form 20-F, reports furnished on Form 6-K, and any other
documents that Nokia or Alcatel Lucent have filed with the SEC. Any
forward-looking statements made in this stock exchange release are
qualified in their entirety by these cautionary statements, and
there can be no assurance that the actual results or developments
anticipated by us will be realized or, even if substantially
realized, that they will have the expected consequences to, or
effects on, us or our business or operations. Except as required by
law, we undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
IMPORTANT ADDITIONAL INFORMATION
This stock exchange release relates to the public exchange offer
by Nokia to exchange all of the ordinary shares, American
Depositary Shares ("ADSs") and convertible securities issued by
Alcatel Lucent for new ordinary shares and ADSs of Nokia. This
stock exchange release is for informational purposes only and does
not constitute an offer to purchase or exchange, or a solicitation
of an offer to sell or exchange, any ordinary shares, ADSs or
convertible securities of Alcatel Lucent, nor is it a substitute
for the Tender Offer Statement on Schedule TO; the Registration
Statement on Form F-4 (the "Registration Statement") (Registration
No. 333- 206365) or the Solicitation / Recommendation Statement on
Schedule 14D-9 each filed with the SEC, the listing prospectus and
listing prospectus supplement of Nokia filed with the Finnish
Financial Supervisory Authority or Nokia's offer document (note
d'information) and Alcatel Lucent's response document (note en
réponse) filed with the Autorité des marchés financiers ("AMF") on
October 29, 2015 and which received the visa of the AMF on November
12, 2015 (including the letters of transmittal and related
documents and as amended and supplemented from time to time, the
"Exchange Offer Documents"). No offering of securities shall be
made in the United States except by means of a prospectus meeting
the requirements of Section 10 of the U.S. Securities Act of 1933.
The exchange offer is being made only through the Exchange Offer
Documents.
The making of the exchange offer to specific persons who are
residents in or nationals or citizens of jurisdictions outside
France or the United States or to custodians, nominees or trustees
of such persons (the "Excluded Shareholders") may be made only in
accordance with the laws of the relevant jurisdiction. It is the
responsibility of the Excluded Shareholders wishing to accept an
exchange offer to inform themselves of and ensure compliance with
the laws of their respective jurisdictions in relation to the
exchange offer. The exchange offer will be made only through the
Exchange Offer Documents.
INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE EXCHANGE
OFFER DOCUMENTS AND ALL OTHER RELEVANT DOCUMENTS THAT NOKIA OR
ALCATEL LUCENT HAS FILED OR MAY FILE WITH THE SEC, AMF, NASDAQ
HELSINKI OR FINNISH FINANCIAL SUPERVISORY AUTHORITY WHEN THEY
BECOME AVAILABLE BECAUSE THEY CONTAIN IMPORTANT INFORMATION THAT
INVESTORS AND SECURITY HOLDERS SHOULD CONSIDER BEFORE MAKING ANY
DECISION REGARDING THE EXCHANGE OFFER.
The information contained in this stock exchange release must
not be published, released or distributed, directly or indirectly,
in any jurisdiction where the publication, release or distribution
of such information is restricted by laws or regulations.
Therefore, persons in such jurisdictions into which these materials
are published, released or distributed must inform themselves about
and comply with such laws or regulations. Nokia and Alcatel Lucent
do not accept any responsibility for any violation by any person of
any such restrictions.
The Exchange Offer Documents and other documents referred to
above, if filed or furnished by Nokia or Alcatel Lucent with the
SEC, as applicable, are available free of charge at the SEC's
website ( www.sec.gov ).
Nokia's offer document (note d'information) and Alcatel Lucent's
response document (note en réponse), which received visa No. 15-573
and No. 15-574 respectively from the AMF, containing detailed
information with regard to the exchange offer, are available on the
websites of the AMF (www.amf-france.org), Nokia (www.nokia.com) and
Alcatel Lucent (www.alcatel-lucent.com).
HUG#1985401
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