Exhibit (d)(3)
SAMPLE
Stock Option Award Agreement
Under the Stock Option Exchange Program
Throughout this Award Agreement we sometimes refer to Sprint Nextel Corporation
and its subsidiaries as "we" or "us."
1. Award of Option Right
On [date], 2010 (the "Date of Grant"), the Compensation Committee of
the Board of Directors of Sprint Nextel (the "Compensation Committee") granted
you, pursuant to the Sprint Nextel Corporation Stock Option Exchange Program
(the "Program"), an Option Right to purchase from us the number shares shown
above of Series 1 common stock, par value $2.00 per share of Sprint Nextel (the
"Common Stock") at an Option Price of $[amount] per share. By tendering for
exchange under the Program a previously granted stock option (the "Surrendered
Option"), you irrevocably agreed upon the Company's acceptance of the
Surrendered option in the Program to the cancellation of the Surrendered Option
and to the grant of this Option Right.
This Option Right is governed by the terms of the Sprint Nextel
Corporation 2007 Omnibus Incentive Plan (the "Plan") and is subject to the terms
and conditions described in this Award Agreement. The Option Right is not
intended to qualify as an "incentive stock option" within the meaning of Section
422 of the Internal Revenue Code of 1986 (the "Code").
2. When the Option Right Becomes Exercisable
Your Option Right becomes exercisable (or "vested") at a rate of 50% of
the total number of shares subject to purchase on each of June [date], 2011 and
June [date], 2012, conditioned upon you continuously serving as our employee
through each applicable vesting date. The portion of your Option Right that has
not vested as of your Termination Date will be forfeited as of such date, unless
vesting accelerates as described in paragraph 3 below. Termination Date means
the later of (a) the last day you are classified on our payroll records as a
common-law employee, even if a court, administrative agency or other person or
entity determines you remain a common law employee thereafter and (b) if, after
your termination you receive severance from us paid according to our payroll
cycle (i.e., not in a lump sum), the last day of your severance pay period.
3. Acceleration of Vesting
The unvested portion of your Option Right may become vested before the
time at which it would normally become vested by the passage of time -- that is,
the vesting may accelerate. Accelerated vesting can apply in the four
circumstances described below.
Stock Option Exchange Option Replacement Award Agreement
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Event Condition for acceleration Effective date of acceleration
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Death If you die Death
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Disability If you have a termination of employment Your Termination Date
under circumstances that would make
you eligible for benefits under our
long-term disability plan
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Change in If you have a termination of employment Your Termination Date (without regard
Control during the CIC Severance Protection to clause (b))
Period under circumstances that you
receive severance benefits under the
Sprint Nextel Separation Plan, the CIC
Severance Plan, or your employment
agreement (as applicable)
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Normal If your Termination Date is on or after Your Termination Date
Retirement o The first anniversary of the
Date of Grant, and
o Your 65th birthday
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CIC Severance Plan means the Sprint Nextel Corporation Change in
Control Plan, as it may be amended from time to time, or any successor plan.
CIC Severance Protection Period means the time period commencing on the
date of the first occurrence of a Change in Control and continuing until the
earlier of (i) the 18-month anniversary of such date and (ii) the Participant's
death.
Sprint Nextel Separation Plan means the Sprint Nextel Separation Plan
as it may be amended from time to time or any successor plan.
4. Exercise of Option Right
To the extent it has vested, you may exercise your Option Right under
this Award in whole or in part at the time or times as permitted by the Plan if
the Option Right has not otherwise expired, been forfeited or terminated. To
exercise you must:
o deliver a written election under procedures we establish (including by
approved electronic medium) and
o pay the Option Price.
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Stock Option Exchange Option Replacement Award Agreement
You may pay the Option Price by
o check or by wire transfer of immediately available funds,
o actual or constructive transfer of shares of Common Stock you have
owned for at least six months having a market value on the Exercise
Date equal to the total Option Price, or
o any combination of cash, shares of Common Stock and other consideration
as the Compensation Committee may permit.
If you pay the Option Price by delivery of funds or shares of Common
Stock, the value per share for purposes of determining your taxable income from
such an exercise will be the Market Value Per Share of the Common Stock on the
immediately preceding trading day before the exercise except that we will use
the average of the high and low prices on that date in lieu of the closing
price.
To the extent permitted by law, you may pay the Option Price from the
proceeds of a sale through a broker we designate. The Market Value Per Share for
purposes of determining your taxable income from such an exercise will be the
actual price at which the broker sold the shares.
5. Expiration of Option Right
Unless terminated earlier in accordance with the terms of this Award
Agreement or the Plan, the Option Right granted herein will expire at 4:00 P.M.,
U.S. Eastern Time, on the seventh anniversary of the Grant Date (the "Expiration
Date"). If the seventh anniversary of the Grant Date, however, is a Saturday,
Sunday or any other day on which the market on which our Common Stock trades is
closed (a "Non-Business Day"), then the Expiration Date will occur at 4:00 P.M.,
U.S. Eastern Time, on the first business day before the seventh anniversary of
the Grant Date.
6. Effect of your Termination of Employment
The length of time you have to exercise your vested Option Right after
your termination of employment with us depends on the reason for your
termination. The table below describes the post-termination exercise period for
the various termination reasons. The Option Right will expire as of the end of
the applicable period. In no event, however, may you exercise your Option Right
after the Expiration Date.
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Stock Option Exchange Option Replacement Award Agreement
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Termination Event Time to Exercise Vested Options
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Resignation May exercise up through the 90th day after
your Termination Date
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Death* May exercise up through the 12th month after
your Termination Date
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Disability - if you have a termination of May exercise up through 60 months after your
employment under circumstances that would Termination Date
make you eligible for benefits under the
company's long-term disability plan*
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Early Retirement (i.e., on your May exercise up through 60 months after your
Termination Date you would be eligible to Termination Date
commence early or special early
retirement benefits under the Sprint
Retirement Pension Plan whether or not
you are a participant in that plan)
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Normal Retirement (i.e., your Termination May exercise up through 60 months after your
Date is on or after your 65th birthday)* Termination Date
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Involuntary termination (not for Cause) May exercise up through:
not in connection with a Change in o the 90th day after your Termination
Control Date, or
o 60 months after your Termination
Date if you are eligible for Early
Retirement or Normal Retirement on
your Termination Date
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If you have a termination of employment May exercise up through:
during the CIC Severance Protection o the 90th day after your Termination Date, or
Period under circumstances for which you o 60 months after your Termination Date if you
receive severance benefits under the are eligible for Early Retirement or Normal
Sprint Nextel Separation Plan, the CIC Retirement on your Termination Date
Severance Plan, or your employment
agreement (as applicable)*
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For Cause Forfeited as of Termination Date
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*See paragraph 3 for rules regarding acceleration of vesting.
If the last day to exercise under the schedule described in the table
above is a Non-Business Day, then you must exercise no later than the previous
business day.
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Stock Option Exchange Option Replacement Award Agreement
You are solely responsible for managing the exercise of your Option
Award in order to avoid inadvertent expiration.
7. Transfer of your Option Right and Designation of Beneficiaries
Your Option Right represents a contract between Sprint Nextel and you,
and your rights under the contract are not assignable to any other party during
your lifetime. Upon your death, your Option Right may be exercised in accordance
with the terms of the Award by any beneficiary you name in a beneficiary
designation or, if you make no designation, by your estate.
8. Plan Terms
All capitalized terms used in this Award Agreement that are not defined
in this Award Agreement have the same meaning as those terms have in the Plan.
The terms of the Plan are hereby incorporated by this reference. The Plan is
available on line at
xxxx://xxxxxxxx.xxxx.xxxxxx.xxx/xxxxxx/xxxxx/?xxxxxxxxxx&xxxxxxxxXxxxxxxx
Directory/LandingPage/20080605_1650_10367056#LTI.
9. Adjustment
In the event of any change in the number or kind of outstanding shares
of our Common Stock by reason of a recapitalization, merger, consolidation,
reorganization, separation, liquidation, stock split, stock dividend,
combination of shares or any other change in our corporate structure or shares
of our Common Stock, an appropriate adjustment will be made consistent with
applicable provisions of the Code and applicable Treasury Department rulings and
regulations in the number and kind of shares subject to outstanding Awards and
any other adjustments as the Board deems appropriate.
10. Amendment; Discretionary Nature of Plan
This Award Agreement is subject to the terms of the Plan, as may be
amended from time to time, except that the Award which is the subject of this
Award Agreement may not be materially impaired by any amendment or termination
of the Plan approved after the Date of Grant without your written consent. You
acknowledge and agree that the Plan is discretionary in nature and may be
amended, cancelled, or terminated by the Company, in its sole discretion, at any
time. The grant of the Option Award under the Plan is a one-time benefit and
does not create any contractual or other right to receive a grant of Option
Awards, other types of grants under the Plan, or benefits in lieu of such grants
in the future. Future grants, if any, will be at the sole discretion of the
Company, including, but not limited to, the timing of any grant, the number of
shares underlying the Option Award granted, and vesting provisions.
11. Data Privacy
By entering into this agreement, you (i) authorize us, and any agent of
ours administering the Plan or providing Plan recordkeeping services, to
disclose to us or our subsidiaries such information and data as we or our
subsidiaries request in order to facilitate the grant of the Option Right and
the administration of the Plan; (ii) waive any
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Stock Option Exchange Option Replacement Award Agreement
data privacy rights you may have with respect to such information; and (iii)
authorize us to store and transmit such information in electronic form.
12. Governing Law
This Award Agreement will be governed by the laws of the State of
Kansas. No shares of Common Stock will be delivered upon the exercise of the
Option Right unless counsel for the Company is satisfied that such delivery will
be in compliance with all applicable laws.
13. Severability
The various provisions of this Award Agreement are severable, and any
determination of invalidity or unenforceability of any one provision shall have
no effect on the remaining provisions.
14. Entire Agreement
As stated in the Offer to Exchange, by tendering the Surrendered option
for exchange under the Program, you irrevocatbly agreed, upon the Company's
acceptance of the Surrndered opion in the Program, that you (a) acknowledge
receiving a copy of the Plan and represent that you are familiar with and
understand all provision of the Plan, the Plan Information Statement dated June
2010 (the "Information Statement") and this Agreement; (b) voluntarily and
knowlingly accept this Agreement and the Option granted to you under it subject
to all provision of the Plan and this Agreement, and (c) represent that you
understand that acceptance of this Agreement through the on-line system, if
applicable, carried the same legal significance as of you manually signed the
Agreement.
To the extent not inconsistent with the provisions of this Award
Agreement, the terms of the Information Statement and the Plan are hereby
incorporated by reference. This Award Agreement, along with the Information
Statement and the Plan, contain the entire understanding of the parties.
Sprint Nextel Corporation
By: ______________________
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933
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