Nokia - Company Announcement

Nokia Board of Directors approves the Nokia Equity Program 2014

Nokia Corporation
Stock Exchange Release
February 14, 2014 at 21.20 (CET +1)

Espoo, Finland - Nokia announced today that Nokia's Board of Directors has
approved the Nokia Equity Program 2014. The Nokia Equity Program 2014 includes
the following equity instruments: 

- An Employee Share Purchase Plan for Nokia employees in selected
jurisdictions, entitling the eligible employees to contribute a part of their
salary to purchase Nokia shares. After a designated holding period, Nokia will
offer the employees one matching share for each two purchased shares; 

- Performance Shares, with the final number of shares dependent on the
achievement of pre-determined financial performance criteria; and 

- Restricted Shares are awarded on an exceptional basis only for recruitment
and retention purposes and are dependent on continued employment during a
three-year restriction period. 

For 2014, the intention has been to simplify the equity programs on offer,
removing stock options completely from the program and limiting the restricted
share plan for use in extraordinary retention and recruitment cases only. Also
the number of restricted shares to be granted has been reduced significantly.
The Board of Directors, in setting up the Equity Program 2014, has taken into
consideration the expected changes in the company structure due to the planned
sale of substantially all of Nokia's Devices & Services business to Microsoft. 

The purpose of the Nokia Equity Program 2014

The Nokia Equity Program 2014 is designed to support the participants' focus
and alignment with Nokia's long term success. Also employees of NSN are
included in the Performance Share Plan and in the Restricted Share Plan. 

Nokia's use of the performance-based plan as the main long-term incentive
vehicle is planned to effectively contribute to the long-term value creation
and sustainability of Nokia and to align the interests of the employees with
those of the shareholders. It is also designed to ensure that the overall
equity-based compensation is driven by performance. 

Shares under the Restricted Share Plan will be granted on a more limited basis
than in previous years. Restricted Shares are granted only for exceptional
retention and recruitment purposes aimed to ensure Nokia is able to retain and
recruit talent vital to the future success of the Company. 

Stock option grants will not feature as part of the Equity Program 2014. 
Greater emphasis will be placed on the Performance Share Plan in 2014, further
promoting Nokia's stance on pay for performance 

The Employee Share Purchase PlanUnder the Employee Share Purchase Plan, eligible Nokia employees (excluding NSN
employees for the 2014 plan cycle) can elect to make monthly contributions from
their salary to purchase Nokia shares. The participation in the plan is
voluntary. 

The annual limit which the participant can contribute to the plan will be
between a minimum of EUR 60 and a maximum of the lower of (1) EUR 1 200 and (2)
10% of a participant's annual gross base salary. Generally, the share purchases
will be made at market value on pre-determined dates on a monthly basis during
a 12-month period. Nokia will offer one matching share for every two purchased
shares the participant still holds after the last monthly purchase has been
made in June 2015. The estimated total maximum amount of employee contributions
during the plan cycle commencing in 2014 would equal approximately 840 000
Nokia shares using closing share price EUR 5.28 on February 13, 2014. Based on
the matching ratio of one matching share for every two purchased shares, the
number of matching shares would be approximately 420 000. 

The Employee Share Purchase Plan is planned to be offered to Nokia employees in
up to 27 countries for the plan cycle commencing in 2014. The first savings
period is intended to start in June 2014 and the first monthly purchases are
planned to be made in July 2014. 

Performance Shares

Under the 2014 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 different for different employee groups as
follows: 

For the Nokia and NSN employees (excluding HERE employees), the performance
criteria are Nokia continuing operations Average Annual Net Sales and Nokia
continuing operations Average Annual EPS. 

For HERE employees, the performance criteria are Nokia continuing operations
Average Annual EPS, HERE Average Annual Net Sales and HERE Average Annual
Operating Profit. 

The plan has a two-year performance period (2014-2015) and a subsequent
one-year restriction period. The number of performance shares to be settled
after the restriction period will start at 25% 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 Performance
Share Plan 2014 could result in an aggregate maximum payout of 29.7 million
Nokia shares in the event that maximum performance against all the performance
criteria is achieved. 

Restricted Shares

The Restricted Share Plan 2014 has a three-year restriction period. The grant
of Restricted Shares in 2014 could result in an aggregate maximum payout of 2
million Nokia shares. 

Employees included in the Equity Program 2014

The primary equity instrument for executive-level employees and directors below
executive level are performance shares. Below the executive and director level,
performance shares are used on a selective basis to ensure retention and
recruitment of functional mastery and other employees deemed critical to
Nokia's future success. 

Nokia has decided to restrict the use of the Restricted Shares so that shares
under the Restricted Share Plan are granted only for exceptional retention and
recruitment purposes to ensure Nokia is able to retain and recruit talent vital
to the future success of the Group and will only be used in limited and
exceptional circumstances. This is a change to the earlier practice when
restricted shares were included as part of the annual compensation reviews. 

Employees in up to 27 countries are planned to be offered the possibility to
participate in the Employee Share Purchase Plan for the plan cycle commencing
in 2014, provided that there are no local regulatory or administrative
restraints for the offer. 

Amendment of the 2013 Performance Share Plan

Following Nokia's purchase of the remaining stake in NSN from Siemens which was
completed in August 2013, and the intended sale of substantially all of Nokia's
D&S business to Microsoft announced on September 3, 2013, the metrics for the
2013 Performance Share Plan are amended to take account of Nokia's new business
going forward. The amendment introduces a metric set on the basis of the
Average Net Sales Index over the two year performance period in replacement of
the metric set on the basis of the Average Annual Net Sales Revenue. In
addition, the Average Annual EPS targets are amended. 

Dilution effect

As of December 31, 2013, the total maximum dilution effect of Nokia's equity
program and option rights currently outstanding, assuming that the performance
shares would be delivered at maximum level, is approximately 2.3%. The
potential maximum effect of the Nokia Equity Program 2014 would be
approximately another 0.9%, meaning a total dilution impact of 3.1%, again
assuming the delivery at maximum level for performance shares, and the delivery
of matching shares against the estimated maximum amount of contributions to the
participants under the Employee Share Purchase Plan. The calculation for the
Employee Share Purchase Plan is based on closing share price EUR 5.28 on
February 13, 2014. 

FORWARD-LOOKING STATEMENTS
It should be noted that Nokia and its business are exposed to various risks and
uncertainties and certain statements herein that are not historical facts are
forward-looking statements, including, without limitation, those regarding: A)
the planned sale by Nokia of substantially all of Nokia's Devices & Services
business, including Smart Devices and Mobile Phones (referred to below as "Sale
of the D&S Business") pursuant to the Stock and Asset Purchase Agreement, dated
as of September 2, 2013, between Nokia and Microsoft International Holdings
B.V.(referred to below as the "Agreement"); B) the closing of the Sale of the
D&S Business; C) receiving timely, if at all, necessary regulatory approvals
for the Sale of the D&S Business; D) expectations, plans or benefits related to
or caused by the Sale of the D&S Business; E) expectations, plans or benefits
related to Nokia's strategies, including plans for Nokia with respect to its
continuing businesses that will not be divested in connection with the Sale of
the D&S Business; F) expectations, plans or benefits related to changes in
leadership and operational structure; G) expectations and targets regarding our
operational priorities, financial performance or position, results of
operations and use of proceeds from the Sale of the D&S Business; and H)
statements preceded by "believe,""expect,""anticipate,""foresee,""sees,""target,""estimate,""designed,""aim", "plans,""intends,""focus,""will" or
similar expressions. These statements are based on management's best
assumptions and beliefs in light of the information currently available to it.
Because they involve risks and uncertainties, actual results may differ
materially from the results that we currently expect. Factors, including risks
and uncertainties that could cause these differences include, but are not
limited to: 1) the inability to close the Sale of the D&S Business in a timely
manner, or at all, for instance due to the inability or delays in obtaining
necessary regulatory approvals for the Sale of the D&S Business, or the
occurrence of any event, change or other circumstance that could give rise to
the termination of the Agreement; 2) the potential adverse effect on the sales
of our mobile devices, business relationships, operating results and business
generally  resulting from the announcement of the Sale of the D&S Business or
from the terms that we have agreed for the Sale of the D&S Business; 3) any
negative effect from the implementation of the Sale of the D&S Business, as we
may forego other competitive alternatives for strategies or partnerships that
would benefit our Devices & Services business and if the Sale of the D&S
Business is not closed, we may have limited options to continue the Devices &
Services  business or enter into another transaction on terms favorable to us,
or at all; 4) our ability to effectively and smoothly implement planned changes
to our leadership and operational structure or maintain an efficient interim
governance structure and preserve or hire key personnel; 5) any negative effect
from the implementation of the Sale of the D&S Business, including our internal
reorganization in connection therewith, which will require significant time,
attention and resources of our senior management and others within the company
potentially diverting their attention from other aspects of our business; 6)
disruption and dissatisfaction among employees caused by the plans and
implementation of the Sale of the D&S Business reducing focus and productivity
in areas of our business; 7) the amount of the costs, fees, expenses and
charges related to or triggered by the Sale of the D&S Business; 8) any
impairments or charges to carrying values of assets or liabilities related to
or triggered by the Sale of the D&S Business; 9) potential adverse effects on
our business, properties or operations caused by us implementing the Sale of
the D&S Business; 10) the initiation or outcome of any legal proceedings,
regulatory proceedings or enforcement matters that may be instituted against us
relating to the Sale of the D&S Business, as well as the risk factors specified
on pages 12-47 of Nokia's annual report on Form 20-F for the year ended
December 31, 2012 under Item 3D. "Risk Factors." and risks outlined in our
fourth quarter and full year 2013 results report available for instance at
www.nokia.com/financials. Other unknown or unpredictable factors or underlying
assumptions subsequently proving to be incorrect could cause actual results to
differ materially from those in the forward-looking statements. Nokia does not
undertake any obligation to publicly update or revise forward-looking
statements, whether as a result of new information, future events or otherwise,
except to the extent legally required.Media Enquiries: 

About Nokia
Nokia is a global leader in mobile communications whose products have become an
integral part of the lives of people around the world. Every day, more than 1.3
billion people use their Nokia to capture and share experiences, access
information, find their way or simply to speak to one another. Nokia's
technological and design innovations have made its brand one of the most
recognized in the world. For more information, visit
http://www.nokia.com/about-nokia. 

Media Enquiries:

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Tel. +358 7180 34900
Email: press.services@nokia.com

www.nokia.com