Exhibit (10)(b)
Sprint Corporation
1990 Stock Option Plan
Adopted as a Stock Option Plan under the
1997 Sprint Corporation Long-Term Stock Incentive Program
As Amended and Restated
by the Board Effective
October 10, 2000
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Table of Contents
1 Establishment 1
2 Defined Terms 1
3 Purpose 1
4 Administration 1
4.01 Interpretation of the Plan . . . . . . . . . . . . 1
4.02 Abstention in Certain Cases by Committee Members . 2
5 Number of Shares Authorized to be Issued 2
6 Grant of Options 3
6.01 Eligibility for Grants . . . . . . . . . . . . . . 3
6.02 Committee Grants . . . . . . . . . . . . . . . . . 3
6.03 Interim Grants . . . . . . . . . . . . . . . . . . 3
6.04 Limitation on Discretion of Committee and
Authorized Officers . . . . . . . . . . . . . . . . 4
7 Terms of Options 4
7.01 Standard Terms of Options . . . . . . . . . . . . . 4
7.02 Mandatory Terms of Incentive Stock Options . . . . 7
7.03 Standard Terms of Incentive Stock Options . . . . . 8
7.04 Stock Option Agreement . . . . . . . . . . . . . . 8
8 Exercise of Options 8
8.01 Notice of Exercise . . . . . . . . . . . . . . . . 8
8.02 Form of Payment of Exercise Price . . . . . . . . 9
9 Withholding of Payroll Taxes on Exercise 10
9.01 Obligation to Pay Payroll Taxes . . . . . . . . . 10
9.02 Amount to Be Withheld . . . . . . . . . . . . . . 10
9.03 Eligibility to Elect Stock Withholding . . . . . 11
9.04 Manner of Withholding . . . . . . . . . . . . . . 11
10 Issuance of Shares on Exercise 12
10.01 Generally . . . . . . . . . . . . . . . . . . . 12
10.02 Elective Issuance of Restricted Shares . . . . 12
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10.03 Mandatory Issuance of Restricted Shares . . . . . 12
10.04 Issuance of Restricted Shares Not Available to
Transferred Options . . . . . . . . . . . . . . . 13
10.05 Terms of Restricted Shares Issued on Exercise . . 13
11 Reload Rights 15
11.01 Grant of Reload Rights on Outstanding
Non-Qualified Options . . . . . . . . . . . . . . 15
11.02 Terms of Reload Options . . . . . . . . . . . . . 15
11.03 Variant Reload Rights . . . . . . . . . . . . . . 17
12 Change in Stock, Adjustments, Etc 17
13 Amendment and Termination 18
14 Effective Date and Duration of the Plan 18
15 Definitions 18
15.01 1989 Program . . . . . . . . . . . . . . . . . . . 18
15.02 1997 Program . . . . . . . . . . . . . . . . . . . 18
15.03 Affiliate . . . . . . . . . . . . . . . . . . . . . 18
15.04 Authorized Officer . . . . . . . . . . . . . . . . 18
15.05 Board . . . . . . . . . . . . . . . . . . . . . . . 18
15.06 Change in Control . . . . . . . . . . . . . . . . . 18
15.07 Code . . . . . . . . . . . . . . . . . . . . . . . 19
15.08 Code Section . . . . . . . . . . . . . . . . . . . 19
15.09 Committee . . . . . . . . . . . . . . . . . . . . 19
15.10 Common Stock . . . . . . . . . . . . . . . . . . . 19
15.11 Company . . . . . . . . . . . . . . . . . . . . . 19
15.12 Corporate Secretary . . . . . . . . . . . . . . . . 20
15.13 Director . . . . . . . . . . . . . . . . . . . . . 20
15.14 Employee . . . . . . . . . . . . . . . . . . . . . 20
15.15 Equity Security . . . . . . . . . . . . . . . . . 20
15.16 Exchange Act . . . . . . . . . . . . . . . . . . . 20
15.17 Exchange Act Section 16 . . . . . . . . . . . . . 20
15.18 Executive Officer . . . . . . . . . . . . . . . . 20
15.19 Exercise Date . . . . . . . . . . . . . . . . . . 20
15.20 Exercise Price . . . . . . . . . . . . . . . . . 20
15.21 Expiration Date . . . . . . . . . . . . . . . . . 20
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15.22 Fair Market Value . . . . . . . . . . . . . . . . 20
15.23 FON Stock . . . . . . . . . . . . . . . . . . . . 21
15.24 Foreign Reload Option . . . . . . . . . . . . . . 21
15.25 Grant Date . . . . . . . . . . . . . . . . . . . 21
15.26 Grantee . . . . . . . . . . . . . . . . . . . . . 21
15.27 Incentive Stock Option . . . . . . . . . . . . . 21
15.28 Minimum Withholding Amount . . . . . . . . . . . 21
15.29 Non-Qualified Option . . . . . . . . . . . . . . 21
15.30 Normal Retirement . . . . . . . . . . . . . . . . 21
15.31 Notice of Exercise . . . . . . . . . . . . . . . 21
15.32 Option . . . . . . . . . . . . . . . . . . . . . 22
15.33 Option Class . . . . . . . . . . . . . . . . . . 22
15.34 Optionee . . . . . . . . . . . . . . . . . . . . 22
15.35 Payroll Tax . . . . . . . . . . . . . . . . . . . 22
15.36 Payroll Taxpayer . . . . . . . . . . . . . . . . 22
15.37 PCS Stock . . . . . . . . . . . . . . . . . . . . 22
15.38 Person . . . . . . . . . . . . . . . . . . . . . 22
15.39 Program Adoption Date . . . . . . . . . . . . . . 22
15.40 Plan . . . . . . . . . . . . . . . . . . . . . . 22
15.41 Qualified Transferee . . . . . . . . . . . . . . 22
15.42 Qualified Trust . . . . . . . . . . . . . . . . . 22
15.43 Reload Option . . . . . . . . . . . . . . . . . . 23
15.44 Restricted Shares . . . . . . . . . . . . . . . . 23
15.45 Retirement . . . . . . . . . . . . . . . . . . . 23
15.46 Seasoned Shares . . . . . . . . . . . . . . . . . 23
15.47 Securities Act . . . . . . . . . . . . . . . . . . 23
15.48 Strike Price . . . . . . . . . . . . . . . . . . . 23
15.49 Subsidiary . . . . . . . . . . . . . . . . . . . . 23
15.50 Tax Date . . . . . . . . . . . . . . . . . . . . . 24
15.51 Termination Date . . . . . . . . . . . . . . . . . 24
15.52 Termination for Cause . . . . . . . . . . . . . . 24
15.53 Total Disability . . . . . . . . . . . . . . . . . 24
15.54 Underlying Option . . . . . . . . . . . . . . . . 24
15.55 Vesting Period . . . . . . . . . . . . . . . . . . 25
15.56 Withholding Amount . . . . . . . . . . . . . . . . 25
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Article 1
Establishment
Pursuant to the 1989 Program the Company established a stock
option plan named the 1990 Stock Option Plan (the "Plan") for
officers and key employees of the Company and its subsidiaries.
The 1989 Program has been replaced by the 1997 Program, and this
Plan is now established pursuant to the 1997 Program.
Article 2
Defined Terms
Capitalized words used throughout this Plan have the meanings
assigned to them parenthetically throughout the Plan or in Article
15.
Article 3
Purpose
The purposes of the Plan are to induce officers and key employees
of the Company or its Subsidiaries who are in a position to
contribute materially to the Company's prosperity to remain with
the Company or its Subsidiaries, to offer them incentives and
rewards in recognition of their share in the Company's progress,
to encourage them to continue to promote the best interests of the
Company and its stockholders, and to allow the Company and its
Subsidiaries to successfully compete with other enterprises in the
recruitment of new officers and key employees.
Article 4
Administration
The Committee shall administer the Plan as set forth in this
Section.
4.01. Interpretation of the Plan.
The Committee may from time to time adopt, and thereafter amend or
rescind, such rules and regulations for carrying out the Plan and
take such action in the administration of the Plan, not inconsistent
with the provisions of the Plan and the 1997 Program, as it considers
proper. The interpretation and construction of any provisions of
the Plan by the Committee shall be final. No member of the Board
or the Committee shall be liable for any action or determination
made in good faith with respect to the Plan or any Option granted
under it.
The Corporate Secretary shall have the discretion and authority to
establish any and all procedures, forms, and rules of a
ministerial nature that the Corporate Secretary considers
necessary or desirable for the orderly administration of the
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Plan and shall have other administrative responsibilities as set
forth elsewhere in this Plan.
The Committee may designate one or more Employees to hear and
resolve disputes arising under the Plan.
4.02. Abstention in Certain Cases by Committee Members.
If any Committee member's participation in an action to approve
the acquisition or disposition of an Equity Security by an Executive
Officer would prevent the Executive Officer's acquisition or
disposition of the Equity Security from being exempt from the
liability provisions of Exchange Act Section 16, the member shall
abstain from voting on the transaction if doing so would cause the
acquisition or disposition to be exempt.
Article 5
Number of Shares Authorized to be Issued
The number of shares of Common Stock that may be issued upon
exercise of Options granted under the Plan may not exceed
82,200,000 shares of FON Stock or 64,400,000 shares of PCS Stock,
subject to adjustment as provided in Article 12 hereof. The shares
issued under the Plan may be either treasury shares or authorized
but unissued shares.
The number of shares of Common Stock that may be issued upon
exercise of Options granted pursuant to this Plan after April 15,
1997, together with shares of Common Stock subject to other awards
under the 1997 Program, may not exceed the limits set forth in
Section 4(a) of the 1997 Program.
The number of shares of Common Stock that may be issued upon
exercise of Incentive Stock Options granted pursuant to this Plan
after April 15, 1997, may not exceed 8,000,000 shares of FON Stock
or 4,000,000 shares of PCS Stock.
The shares of Common Stock allocable to the unexercised portion of
any Option that for any reason is forfeited, canceled, expired or is
otherwise terminated may again be subject to an Option under the Plan.
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Article 6
Grant of Options
6.01. Eligibility for Grants.
The Committee or an Authorized Officer may grant Options under this
Plan to any Grantee who is a Director or Employee of the Company or
a Subsidiary of the Company on the Grant Date of the Option and to
whom the granting of Options and the exercise thereof would not be
in violation of the laws of the jurisdiction, foreign or domestic,
having legal authority over the issuance of Options to, or the
exercise thereof by, Directors or Employees working or residing in
such jurisdiction.
No Incentive Stock Option may be granted to any Grantee who owns
directly or indirectly shares of Common Stock or options to
purchase shares of Common Stock, together possessing more than 10%
of the total combined voting power or value of all classes of
stock of the Company or any of its Subsidiaries.
6.02. Committee Grants.
The Committee shall determine which Directors or Employees among those
eligible shall be granted Options and, with respect to each Option,
shall specify the Option Class and number of shares of Common Stock
subject to the Option. The Committee may designate Grantees, the
Option Class, and the number of shares subject to each Option by any
objectively determinable description. The Committee may also specify
the Grant Date of the Option, the Strike Price, the Expiration Date
of the Option, the rate at which the Option may be exercised, and such
other terms of the Option as the Committee may consider appropriate.
In making its determinations, the Committee shall take into
consideration the value of the services rendered by the Grantees,
their present and potential contribution to the success of the Company
and its Subsidiaries, and such other factors the Committee may consider
relevant in accomplishing the purposes of the Plan.
6.03. Interim Grants.
Between meetings of the Committee, any of the Authorized Officers may
grant an Option to any eligible Employee other than a Director or an
Executive Officer. The number of shares subject to Options granted
pursuant to this Section 6.03 may not exceed a total of 20,000 shares
of all Classes of Common Stock for any single Grantee between any two
meetings of the Committee. An Authorized Officer may make interim
grants of Options in excess of 20,000 shares with the written
concurrence of the chairman of the Committee on or before the Grant
Date.
In making such grants, the Authorized Officer shall specify in a
writing, executed by the Authorized Officer (and the chairman of
the Committee, if the number of shares subject to the Option are
in excess of 20,000) and setting forth the actual date of
execution, which Employees among those eligible shall be granted
Options and, with respect to each Option, shall specify the Option
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Class and number of shares of Common Stock subject to the Option.
The Authorized Officer may designate Grantees, the Option Class,
and the number of shares subject to each Option by any objectively
determinable description. The Authorized Officer may also specify
the Grant Date of the Option, the Strike Price, the Expiration
Date of the Option, the rate at which the Option may be exercised,
and such other terms of the Option as the Authorized Officer may
consider appropriate. In making its determinations, the Authorized
Officer shall take into consideration the value of the services
rendered by the Grantees, their present and potential contribution
to the success of the Company and its Subsidiaries, and such other
factors the Authorized Officer may consider relevant in
accomplishing the purposes of the Plan.
The Authorized Officer shall report to the Committee the Grantees
and terms of all Options granted pursuant to this Section 6.03 at
the next meeting of the Committee following such grants.
6.04. Limitation on Discretion of Committee and Authorized
Officers.
Neither the Committee nor the Authorized Officer may
(i) set the Grant Date of any Option to any date earlier than the
date of the action granting the Option;
(ii) establish the Strike Price of any Option at a price lower
than the greater of (a) the Fair Market Value of one share
of the Option Class of Common Stock on the Grant Date of the
Option or (b) the par value on the Grant Date of the Option
Class of the Common Stock; or
(iii)subject more than 6,000,000 shares to Options in the FON
Stock Option Class nor more than 3,000,000 shares to Options
in the PCS Stock Option Class granted to any single Director
or Employee in any calendar year.
For purposes of clause (iii), shares subject to Options granted pursuant to the
last sentence of Section 4(a) of the 1997 Program shall be counted in the year
the Option is granted, rather than the year in which shares become first
available for issuance.
Article 7
Terms of Options
7.01. Standard Terms of Options.
Unless the Committee or Authorized Officer specifies otherwise, the
terms set forth in this Section 7.01 shall apply to all Options
granted under this Plan. Any Stock Option Agreement that incorporates
the terms of the Plan by reference shall be deemed to have incorporated
the terms set forth in this Section 7.01 to the extent that these
terms are not in conflict with those explicitly set forth in the
Stock Option Agreement.
(a) Non-Qualified Options. Each Option shall be a Non-Qualified
Option.
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(b) Grant Date. The Grant Date of each Option shall be the date
of the Committee's or Authorized Officer's action granting
the Option.
(c) Strike Price. The Strike Price of each Option shall be the
Fair Market Value of one share of the Option Class of Common
Stock on the Grant Date.
(d) Expiration Date. The Expiration Date of each Option shall be
the close of business on the tenth anniversary of the Option's
Grant Date. The Option shall not be exercisable after its
Expiration Date.
(e) Rate of Exercisability. Each Option shall become exercisable
with respect to 25% of the number of shares of the Option Class
of Common Stock subject to the Option on each of the first four
anniversaries of the Grant Date if, on such anniversary date,
the Grantee shall have been continuously employed by or served
as a Director of the Company, a Subsidiary of the Company, or
an Affiliate from the Grant Date.
(f) Reload Rights. Each Non-Qualified Option, other than Options
granted pursuant to Reload Rights, shall be granted with Reload
Rights.
(g) Limitations on Transfer. No Option may, during the lifetime of
the Grantee, be transferred, levied, garnished, executed upon,
subjected to a security interest, or assigned to any person other
than the Grantee, except that a Grantee may transfer an Option to
a Qualified Transferee if the transfer is made without payment of
consideration being paid to the Grantee. Documents evidencing the
transfer of any Option and the identity of the Qualified
Transferee shall be in such form as may be required by the
Corporate Secretary. No such Qualified Transferee may dispose of
shares issued upon exercise of an Option, other than to the
Company, until such shares are validly registered or, in the
opinion of the Corporate Secretary, exempt from registration under
the Securities Act.
(h) Post-Employment Exercise of Options. Each Option may be exercised
after the Grantee's Termination Date only with respect to the
number of shares of Common Stock that were exercisable on the
Grantee's Termination Date. An Optionee may exercise an Option
before its Expiration Date with respect to those shares during a
limited period beginning on the Grantee's Termination Date and
ending
(i) on the fifth anniversary of the Grantee's Termination Date, if
the Grantee's service as Director or employment terminated by
reason of his Retirement or Total Disability;
(ii) on the first anniversary of the Grantee's Termination Date if
the Grantee's employment or service as Director terminated by
reason of his death;
(iii)on the day three months following the Grantee's Termination
Date if the Grantee terminated his employment or service as
Director voluntarily, for a reason other than Retirement, or
involuntarily for a
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reason not constituting Termination for Cause.
If a Grantee's employment has been Terminated for Cause, the
Optionee shall forfeit all outstanding Options immediately on the
Grantee's Termination Date.
An Option granted pursuant to the last sentence of Section 4(a) of the 1997
Program that was not exercisable on the Grantee's Termination Date solely
because the number of shares covered by the Option exceeded the number of shares
available for issuance may be exercised during the period described above to the
extent that shares become available for issuance during such period.
(i) Acceleration on Termination of Employment for Certain Reasons.
(1) Death or Total Disability. Each Option shall become
exercisable immediately on the Grantee's Termination
Date if the reason for termination was the Grantee's
death or Total Disability.
(2) Normal Retirement. Each Option shall become exercisable
immediately on the Grantee's Termination Date if (i) the
reason for termination was the Grantee's Normal Retirement
and (ii) the Option's Grant Date was at least one year
before the Grantee's Termination Date.
(j) Acceleration on Change in Control.
(1) Acceleration. Each Option shall become immediately exercisable
in full upon a Change in Control if
(i) the Change in Control occurs at least one year after the
Option's Grant Date and
(ii) the Grantee of the Option has been a Director, Employee, or
an employee of an Affiliate continuously from the Option's
Grant Date to the date of the Change in Control.
(2) Limitation on Acceleration. If the acceleration of
exercisability under Section 7.01(j)(1), together with all other
payments or benefits contingent on the Change in Control with the
meaning of Code Section 280G, results in any portion of such
payments or benefits not being deductible by the Company as a
result of the application of Code Section 280G, the benefits shall
be reduced until the entire amount of the benefits is deductible.
The reduction shall be effected by the exclusion of grants of
options or portions thereof in reverse chronological order of
their respective Grant Dates from the application of Section
7.01(j)(1) until no portion of such benefits is rendered
non-deductible by application of Code Section 280G.
(k) Exercise After Death of Optionee. Upon the death of an
Optionee, all Options held by the Optionee on the Optionee's
date of death, to the extent exercisable under their terms,
may be exercised by
(i) the executor or administrator of the Optionee's estate,
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(ii) the Person or Persons to whom the Optionee's rights under the
Options pass by the Optionee's will or the laws of descent and
distribution, or
(iii)the beneficiary or beneficiaries designated by the Optionee
in accordance with Section 7.01(l).
(l) Designation of Beneficiaries. An Optionee may designate a
beneficiary or beneficiaries to exercise unexpired Options
and to own shares issued upon any such exercise after the
Optionee's death without order of any probate court or
otherwise. A beneficiary so designated may exercise an Option
upon presentation to the Company of evidence satisfactory to the
Corporate Secretary of the beneficiary's identity and the death
of the Optionee. An Optionee may change any beneficiary designation
at any time before his death but may not do so by testamentary
designation in his will or otherwise. Beneficiary designations must
be made in writing on a form provided by the Corporate Secretary.
Beneficiary designations shall become effective on the date that
the form, properly completed, signed, and notarized, is received
by the Corporate Secretary. Any designation of a beneficiary by an
Optionee with respect to any Option shall be canceled upon the
transfer of such Option by the Optionee in accordance with the
terms of the Plan.
(m) Agreement to Remain Employed. Each Grantee other than
Directors shall, as consideration for the grant of each Option,
agree in the Stock Option Agreement to remain in the employ of
the Company, its Subsidiaries, or an Affiliate at the pleasure
of the Company, such Subsidiary, or Affiliate for at least one
year from the Option's Grant Date or the earlier termination
of the Grantee's employment effected or approved by the Company,
the Subsidiary, or Affiliate. If the Grantee violates the
agreement, the Optionee shall forfeit the Option.
Nothing contained in the Plan or in any Option granted pursuant to
the Plan shall confer upon any Grantee any right to continue
employment with the Company, its Subsidiaries, or Affiliates nor
interfere in any way with the right of the Company, its
Subsidiaries, or Affiliates to terminate the Grantee's employment
or change the Grantee's compensation at any time.
(n) Forfeiture Upon Conflict of Interest. If any Grantee, without
the consent of the Committee, becomes associated with, employed
by, renders services to, or owns any significant interest in
any business that is in competition with the Company, its
Subsidiaries, or Affiliates, any outstanding Option granted to
such Grantee shall be forfeited.
(o) Exercise Subject to Available Shares. No Option shall be exercisable
unless, on the Exercise Date, there are sufficient shares available under
the Plan and the 1997 Program to allow for the issuance of shares pursuant
to the Exercise. At any time when sufficient shares are not available, all
Exercises of Options granted under the authority of the last sentence of
Section 4(a) of the 1997 Program shall be suspended, and the term of any
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Options that would otherwise expire during the term of any such suspension
shall be extended by the amount of time during which the suspension was in
effect.
7.02. Mandatory Terms of Incentive Stock Options.
If the Committee or Authorized Officer specifies that an Option
is an Incentive Stock Option, the terms set forth in this Section
7.02 shall be incorporated into the terms of the Option in
preference to any conflicting terms set forth in Section 7.01.
If the Stock Option Agreement setting forth the terms of any Option
contradict the terms set forth in this Section 7.02, such Option
shall be treated as a Non-Qualified Stock Option, notwithstanding
its designation as an Incentive Stock Option.
(a) Grant Date within 10 Years of Program Adoption. No Incentive
Stock Option may be granted under the Plan after the tenth
anniversary of the Program Adoption Date.
(b) Limitation on Option Term. No Incentive Stock Option may be
exercised after the tenth anniversary of its Grant Date.
(c) Strike Price. No Incentive Stock Option may have a Strike
Price less than the Fair Market Value of one share of the
Option Class of Common Stock on the Grant Date of the
Incentive Stock Option.
(d) Non-Transferability. No Incentive Stock Option may be
transferred by the Grantee except by the Grantee's will
or the laws of descent and distribution. An Incentive
Stock Option may be exercised during the Grantee's lifetime
only by the Grantee, and after the Grantee's death only by
a beneficiary designated by the Grantee pursuant to the terms
of the Plan, or otherwise by the executor or administrator
of the Grantee's estate or the Person succeeding to the
Grantee's interest in the Incentive Stock Option under the
Grantee's will or the applicable laws of intestacy.
7.03. Standard Terms of Incentive Stock Options.
Unless the Committee or Authorized Officer specifies otherwise in
the action granting the Option, the following terms shall apply to
all Incentive Stock Options granted under the Plan. To the extent
the terms set forth in this Section 7.03 conflict with the standard
terms applicable to Options generally set forth in Section 7.01,
the terms of this section shall control the terms of any Options
designated as Incentive Stock Options at the time of grant.
(a) Maximum Rate of Exercisability. The Fair Market Value on the
Grant Date of the shares of Common Stock subject to any
Incentive Stock Option with respect to which the Incentive
Stock Option becomes exercisable for the first time during
any calendar year, together with the Fair Market Value of
shares of Common Stock subject to other Incentive Stock Options
on their respective Grant Dates owned by the Optionee under
all plans of the Company and its Subsidiaries and first
becoming exercisable in the same calendar year, shall not
exceed $100,000 or, if different, the maximum
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limitation in effect under Code Section 422 for Incentive Stock
Options on the Grant Date of such Incentive Stock Option. To the
extent the terms of the Option permit the exercise of an Option for
more shares than permitted by this Section 7.03(a), each
Option or portion of an Option, in reverse chronological order
of their Grant Dates, shall be treated as Non-Qualified Options
until the remaining Options or portions of Options meet the
limitations set forth in this Section 7.03(a).
(b) Post-Termination Exercise. Any Incentive Stock Option exercised
after the end of the 12-month period beginning on the Grantee's
Termination Date shall, to that extent, be treated as a Non-
Qualified Option.
7.04. Stock Option Agreement.
The terms of each Option shall be set forth in a Stock Option
Agreement executed by the Company and the Grantee. The Stock Option
Agreement must set forth those terms that are not made standard
terms of the Option pursuant to this Plan.
Article 8
Exercise of Options
8.01. Notice of Exercise.
An Optionee may exercise his Option to purchase shares of Common
Stock by written notice to the Corporate Secretary
(i) unambiguously identifying the Option that he is exercising;
(ii) stating the number of shares with respect to which he is
exercising the Option;
(iii)accompanied by payment of the Exercise Price in cash or any
other form permitted by Section 8.02;
(iv) if the Optionee wants to have the shares issued to be
registered jointly with the Optionee's spouse, a statement
to that effect;
(v) if the Optionee is electing to have any Payroll Tax
withholding obligation discharged by delivery of Seasoned
Shares or withholding of shares from shares issuable upon
the exercise pursuant to Section 9.04, a statement to that
effect, and, if the Optionee elects to have more than the
required minimum percentage of Payroll Taxes withheld, a
statement of the percentage to be withheld, not exceeding, if
the Grantee is an Executive Officer, the applicable marginal
tax rate;
(vi) if the Optionee is electing to receive Restricted Shares
pursuant to Section 10.02, a statement of the Vesting Period
the Optionee is electing;
(vii)if the Optionee is delivering or attesting to ownership of
Restricted Shares in payment of the Exercise Price and
desires to elect a more extended
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Vesting Period pursuant to Section 10.03, a statement of the
extended Vesting Period the Optionee is electing.
The Corporate Secretary may dispense with a written Notice of
Exercise in the case of certain exercises in which he considers a
written Notice of Exercise unnecessary.
The Exercise Date shall be the date on which the Notice of
Exercise, together with the payment of the Exercise Price, is
received by the Corporate Secretary or his designee. The Optionee
may not, after the Exercise Date, change the form of payment of
the Exercise Price, the election regarding stock withholding, or
other aspects of the exercise dependent on the Fair Market Value
of the Common Stock.
The Corporate Secretary may condition the exercise of an Option on
the Optionee's filing with the Company a representation in writing
that at the time of such exercise it is the Optionee's then
present intent to hold the shares being purchased for investment
and not for resale, or on the completion of any registration or
other qualification of shares under any state or federal laws or
rulings or regulations of any government regulatory body that the
Corporate Secretary may determine to be necessary or advisable.
8.02. Form of Payment of Exercise Price.
(a) Payment in Cash. Unless the Optionee elects in the Notice of
Exercise to make payment in another form authorized by the Plan,
payment of the Exercise Price shall be in United States dollars,
payable in cash or by check. The Corporate Secretary may establish
procedures to delay the processing of any Option exercise until
any check delivered in payment of the Exercise Price has cleared,
and, if a check fails to clear, cancel the exercise.
(b) Payment in Shares of Common Stock. On exercise of any Option,
the Optionee may elect in the Notice of Exercise to pay the
Exercise Price by surrender of stock certificates in transferable
form representing Seasoned Shares of the Option Class having an
aggregate Fair Market Value, determined as of the Exercise Date,
at least equal to the Exercise Price.
(c) Payment by Attestation. In lieu of the delivery of physical
certificates, an Optionee may deliver shares in payment of
the Exercise Price by attesting, on a form established by the
Corporate Secretary, to the ownership, either outright or through
ownership of a broker account, of a sufficient number of Seasoned
Shares of the Option Class to pay the Exercise Price. The
attestation must be notarized and signed by the Optionee and any
co-owners with the Optionee of the shares with respect to which the
attestation is being made. The form of attestation must be
accompanied by any other documentation the Corporate Secretary
considers necessary to evidence actual ownership of such shares
or otherwise preserve the integrity of the Plan. Shares, the
ownership of which is so attested to by the Optionee, shall be
deemed to have been re-issued to the Optionee on the Exercise Date
in partial satisfaction of the Company's obligation to issue
shares of
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the Option Class of Common Stock pursuant to the Option exercise to
which it relates.
(d) Fractional Shares. If an Optionee pays the Exercise Price of
an Option by delivery or attestation of Seasoned Shares, the
Company shall apply to payment of the Exercise Price from the
shares delivered or attested the highest number of whole shares
having a Fair Market Value on the Exercise Date less than or
equal to the Exercise Price, and the Optionee shall be required
to pay in cash the Fair Market Value of the fractional share
resulting from truncating the number of shares to a whole number
of shares.
Article 9
Withholding of Payroll Taxes on Exercise
9.01. Obligation to Pay Payroll Taxes.
Any Optionee, Grantee, or other Person (the "Payroll Taxpayer") with
respect to whom the Company or a Subsidiary of the Company has an
obligation under any Payroll Tax law to withhold amounts with respect
to income arising from the exercise of any Option must pay to the
Company or Subsidiary of the Company the Minimum Withholding Amount.
9.02. Amount to Be Withheld.
The Payroll Taxpayer may elect in the Notice of Exercise or on
another form specified by the Corporate Secretary for such purpose
an amount to be withheld (the "Withholding Amount") with respect to
the exercise of any Option. The Withholding Amount must be greater
than or equal to the Minimum Withholding Amount and, if the Payroll
Taxpayer is an Executive Officer, less than or equal to the Payroll
Taxpayer's combined marginal tax rate for all Payroll Taxes. In the
absence of such an election, the Withholding Amount shall be the
Minimum Withholding Amount.
If all amounts withheld in payment of Payroll taxes are reported
to the appropriate taxing jurisdiction as amounts withheld from
the Payroll Taxpayer, the Company or Subsidiary may, in cases
where the Corporate Secretary considers it necessary, set the
Withholding Amount to an amount in excess of the Minimum
Withholding Amount based on assumptions about the amount required
by law to be withheld.
9.03. Eligibility to Elect Stock Withholding.
A Payroll Taxpayer may elect to pay all or part of the Withholding
Amount in shares of the Option Class of Common Stock if the Optionee
pays the Exercise Price by delivering or attesting to ownership of
shares of the Option Class of Common Stock pursuant to Sections
8.02(b) or 8.02(c).
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9.04. Manner of Withholding.
If the Payroll Taxpayer is eligible to satisfy his obligation to pay
the Withholding Amount by payment of shares of the Option Class of the
Common Stock pursuant to Section 9.03, he may pay the Withholding
Amount by one or more of the following methods:
(i) delivering Seasoned Shares of the Option Class; or
(ii) directing the Company to withhold from those shares that
would otherwise be received upon exercise of the Option
or upon the vesting of Restricted Shares, shares of the
Option Class of the Common Stock having a Fair Market
Value on the Tax Date of no more than the Minimum
Withholding Amount; or
(iii)paying cash to the Company.
If the Payroll Taxpayer is not eligible to elect stock withholding,
the Withholding Amount must be paid entirely in cash. Any portion
of the Withholding Amount that would require withholding or delivery
of a fractional share and any portion of the Withholding Amount not
paid by the withholding or surrender of Common Stock must be paid
in cash.
(a) Limit on Use of Unvested Restricted Shares. If the Option
exercise resulted in the issuance of Restricted Shares and
the Vesting Period with respect to the Restricted Shares
has not ended on or before the Tax Date, method (ii)
described in Section 9.04 shall not be available as a means
of stock withholding.
(b) Limit with Respect to Transferred Options. If an Option was
transferred by the Grantee or the tax liability resulting from
the exercise of the Option is otherwise not imposed on the
Optionee, method (ii) described in Section 9.04 shall not be
available as a means of stock withholding.
Article 10
Issuance of Shares on Exercise
10.01. Generally.
No Optionee will be considered a holder of any shares of Common
Stock subject to an Option until a stock certificate or certificates
for such shares are issued to the Optionee after an exercise of the
Option under the terms of the Plan. No Optionee shall be entitled
to dividends (ordinary or extraordinary, whether in cash, securities
or other property), distributions, or other rights with respect to
the shares subject to purchase under the Option unless the record
date for any such dividend, distribution, or other right falls on
or after the date the Optionee becomes a record holder of such shares.
All shares of Common Stock issued pursuant to an exercise of an
Option shall be issued in the name of the Optionee, or in the name
of the Optionee and the
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Optionee's spouse, and shall, except as otherwise provided in Article
8, be freely transferable by the registered owners upon issuance.
10.02. Elective Issuance of Restricted Shares.
Certain Optionees, as determined by the Committee, may elect to
receive Restricted Shares upon the exercise of an Option if the
Optionee so states in the Notice of Exercise and has paid the
Exercise Price of the Option by attesting to or by delivering
shares of unrestricted Common Stock pursuant to Sections 8.02(b)
or 8.02(c).
If an Optionee elects on exercise of any Option to receive
Restricted Shares, the Company shall issue to the Optionee
(i) a number of unrestricted shares of the Option Class of Common
Stock equal to the number of unrestricted shares the Optionee
used to pay the Exercise Price plus
(ii) all other shares issuable pursuant to the exercise of the
Option as Restricted Shares, having the Vesting Period specified
by the Optionee in the Notice of Exercise and otherwise subject
to the restrictions on transfer and other terms set forth in
Section 10.05.
10.03. Mandatory Issuance of Restricted Shares.
Certain Optionees, as determined by the Committee, may in the exercise
of an Option deliver or attest to ownership of Restricted Shares of
the Option Class of Common Stock in payment of the Exercise Price,
notwithstanding restrictions on transferability to which such shares
are subject. If an Optionee elects to so pay the Exercise Price of an
Option, the Company shall issue to the Optionee
(i) a number of shares of the Option Class equal to the number of
Restricted Shares used to pay the Exercise Price as Restricted
Shares having a Vesting Period identical to the Vesting Period
of the shares so used in payment of the Exercise Price and
(ii) all other shares of the Option Class issuable pursuant to the
exercise of the Options as Restricted Shares having a Vesting
Period identical to the Vesting Period of the shares so used
to pay the Exercise Price, or if the Optionee elects in the
Notice of Exercise, a Vesting Period extending beyond the end
of the Vesting Period of the shares so used.
10.04. Issuance of Restricted Shares Not Available to Transferred
Options.
Neither the Optionee nor the Grantee of an Option transferred by
the Grantee pursuant to the provisions of this Plan may use
Restricted Shares in payment of the Exercise Price nor elect to
receive Restricted Shares on exercise of the Option.
10.05. Terms of Restricted Shares Issued on Exercise.
Subject to the right of the Optionee to elect the length of the
Vesting Period applicable to Restricted Shares issued pursuant to
an Option exercise under the
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Plan, all Restricted Shares issued pursuant to the Plan shall be
subject to the terms and conditions set forth in this Section 10.05.
(a) Restriction on Transfer. An Optionee who receives Restricted
Shares may not sell, transfer, assign, pledge or otherwise
encumber or dispose of the Restricted Shares until the end
of the Vesting Period for such shares, except:
(i) to the Company in payment of the exercise price of a stock
option issued by the Company under any director or employee
stock option plan adopted by the Company that provides for
payment of the exercise price in the form of restricted
stock or
(ii) to a trust that is a Qualified Trust upon the following
terms:
(A) the Company receives, before the transfer, a true copy of the
trust agreement of the Qualified Trust and an opinion from
Optionee's counsel that (1) the trust will be treated as a
grantor trust owned by the Optionee under Subchapter J of the
Code at all times until the restrictions on such stock lapse
or the stock is forfeited under the terms of their grant, (2)
the terms of the trust provide that upon the forfeiture of the
Restricted Shares under the terms of its grant or the earlier
termination of the trust for whatever reason, ownership of the
Restricted Shares shall revert to the Optionee or to the
Company, (3) the trustee of such trust may not, prior to the
lapsing of restrictions on such stock, sell, transfer, assign,
pledge, or otherwise encumber or dispose of the Restricted Shares
except to the Company or to the Optionee, subject to the
restrictions provided for in this Plan, and (4) until the
restrictions lapse, the trustee is not authorized to incur
liabilities on behalf of the trust, other than to the
beneficiaries of the trust; and
(B) the Corporate Secretary, in his discretion, may require the
Optionee and the trustee to execute other documents as a
precondition to such transfer to insure enforcement of the
terms of the Restricted Shares or otherwise.
(b) Enforcement of Transfer Restrictions. Unless the Corporate
Secretary establishes alternative procedures, certificates
representing Restricted Shares shall be registered in the
name of the Optionee (or the Qualified Transferee trust in
the case of shares transferred to such a trust pursuant to
Section 10.05(a)) and shall be held by the Company in escrow,
together with a stock power assigning the Restricted Shares
back to the Company, to be used only in the event of the
forfeiture of any of the Restricted Shares.
(c) Vesting Period. When an Optionee elects a Vesting Period to
apply to Restricted Shares issued under the Plan, the Optionee
shall elect a Vesting Period ending at least six months and no
more than ten years after the Exercise Date of the Option with
respect to which the Restricted Shares
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were issued, but in no event may the Optionee elect a Vesting
Period ending before the end of the Vesting Period of any
Restricted Shares used to pay the Exercise Price of the Option
pursuant to Section 10.03.
The Corporate Secretary may establish restrictions on the dates
during the year on which Vesting Periods electable pursuant to
this Article 10 may end for the convenient administration of
Restricted Shares issued under the Plan.
At any time on or before the last day of the 13th calendar month
that ends on or before the last day of the Vesting Period for any
Restricted Shares, the Optionee may elect to extend the Vesting
Period on all but not a portion of the Restricted Shares by any
multiple of six months.
(d) Forfeiture and Vesting of Restricted Shares.
(1) Vesting at End of Vesting Period. Any Restricted Shares not
forfeited by the end of the Vesting Period shall vest, and
the Company shall issue a certificate evidencing the shares
to the registered owner thereof promptly after the end of the
Vesting Period.
(2) Restricted Shares Issued Mandatorily. Unless the Committee
determines otherwise, Restricted Shares issued mandatorily
pursuant to the exercise of an Option under Section 10.03
shall inherit the vesting conditions of the Restricted Shares
used to pay the Exercise Price. If the Restricted Shares used
to pay the Exercise Price would be forfeited upon the Grantee's
termination of service or employment before the end of the
Vesting Period, the Restricted Shares issued pursuant to such
exercise shall be forfeited; if the Restricted Shares used
to pay the Exercise Price would be vested upon the Grantee's
termination of service or employment before the end of the Vesting
Period, the Restricted Shares issued pursuant to such exercise
shall vest and the Company shall issue a certificate representing
the shares to the registered owner thereof. Likewise, Restricted
Shares issued under the Plan shall be forfeited or shall vest upon
the occurrence of any other event that would cause the forfeiture
or vesting of the Restricted Shares used to pay the Exercise Price
under Section 10.03.
(3) Restricted Shares Issued Electively. Unless the Committee
determines otherwise, restrictions on Restricted Shares
issued at the election of the Optionee under Section 10.02
shall lapse if the Grantee terminates his service or employment
at any time before the end of the Vesting Period for the
Restricted Shares if
(i) the Grantee terminated service or employment by reason of the
Grantee's Death or Total Disability,
(ii) the Grantee terminated service or employment by reason of the
Grantee's Normal Retirement, or
(iii)the Grantee's employment was terminated involuntarily other
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than as a Termination for Cause,
in which cases, the Company shall issue a certificate representing
the shares to the registered owner thereof; otherwise the
Restricted Shares shall be forfeited.
(e) Acceleration on Change in Control. Unless the Committee
determines otherwise, Restricted Shares issued at the election
of the Optionee under Section 10.02 shall vest on a Change
in Control if the Change in Control occurs at least one year
after the Exercise Date on which the Restricted Shares were
issued.
(f) Rights of Grantee in Restricted Stock. The registered owner of
Restricted Shares shall have the right to vote the shares of
stock and to receive dividends or other distributions with
respect to the shares.
Article 11
Reload Rights
11.01. Grant of Reload Rights on Outstanding Non-Qualified Options.
The Committee may grant Reload Rights with respect to any
outstanding Non-Qualified Options issued under any stock option
plan of the Company, whether originally granted with Reload Rights
or not.
11.02. Terms of Reload Options.
Any Underlying Option granted Reload Rights shall, unless the
Committee specifies other terms at the time the Reload Rights are
granted, entitle the Grantee to receive a new Option (a "Reload
Option") to purchase shares of the same Option Class as the
Underlying Option upon the Optionee's exercise of the Underlying
Option by delivery or attestation of shares of Common Stock in
payment of the Exercise Price on the terms set forth in this
Article 11.
(a) Conditions to the Grant of Reload Options. No Reload Option
shall be granted on the exercise of the Underlying Option unless
(i) a sufficient number of shares remain authorized and not issued
or subject to purchase under outstanding Options granted under
the Plan;
(ii) the Grantee of the Option is a Director or Employee on the
Exercise Date of the Underlying Option;
(iii)the exercise of the Underlying Option is for the purchase of
a number of shares of Common Stock at least equal to the
lesser of (a) 25% of the total number of shares subject to
purchase under the Underlying Option or (b) 100% of the shares
with respect to which the Underlying Option is then exercisable;
(iv) the Grant Date of the Reload Option would be at least one
year before the Expiration Date of the Underlying Option; and
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(v) the Fair Market Value of one share of the Underlying Option's
Option Class on the Exercise Date is greater than or equal to
the Strike Price of the Underlying Option.
(b) Number of Shares Subject to Purchase; Grant Date. Each Reload
Option shall entitle the Optionee to purchase a number of shares
equal to the sum of
(i) the number of shares of the Option Class used to pay the
Exercise Price of the Underlying Option pursuant to Sections
8.02(b) or 8.02(c) on the Exercise Date and
(ii) the number of shares of the Option Class delivered or
withheld in payment of the Withholding Amount pursuant to
Section 9.04.
If the Exercise Date and the Tax Date do not coincide, the Reload
Option shall be issued as two separate Options to purchase the
number of shares set forth in (i) and (ii) above and having Grant
Dates on the Exercise Date and the Tax Date, respectively.
(c) Strike Price. Each Reload Option shall have a Strike Price
equal to the Fair Market Value of one share of the Option Class
of the Common Stock on the Grant Date of the Reload Option.
(d) Expiration Date. Each Reload Option shall have the same
Expiration Date as the Underlying Option.
(e) No Reload Rights. No Reload Option shall have Reload Rights.
(f) Rate of Exercisability. Each Reload Option shall become
exercisable in full on the first anniversary of the Grant
Date of the Reload Option.
(g) Forfeiture on Disposition of Shares Acquired in Exercise of
Underlying Option. Each Reload Option shall be forfeited if
the Optionee disposes of any of the shares issued on exercise
of the Underlying Option before the date six months after the
Exercise Date to any Person other than the Company in the payment
of Payroll Taxes on exercise of the Underlying Option.
(h) Other Terms and Conditions. Except to the extent in conflict
with the terms set forth in this Article 11, the terms for
Options granted under the Plan as set forth in Section 7.01
shall apply to each Reload Option.
(i) Terms of Foreign Reload Options. A Foreign Reload Option shall
be subject to the terms and conditions set forth in the plan in
which the underlying reload right was granted.
11.03. Variant Reload Rights.
Any terms of Reload Rights or Reload Options different from those
set forth in this Article 11 must be set forth in the Stock Option
Agreement for the Underlying Option.
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Article 12
Change in Stock, Adjustments, Etc
If the outstanding Common Stock of the Company is increased or
decreased or changed into or exchanged for a different number of
shares or kind of shares or other securities of the Company or of
another Person by reason of a reorganization, merger,
consolidation, recapitalization, reclassification, stock split-up,
combination of shares, or a dividend payable in capital stock
(including a spinoff), or otherwise, the Committee shall make an
appropriate adjustment to the number and kind of shares for the
purchase of which Options may be granted under the Plan including
the maximum number that may be granted to any one person.
In addition, the Committee shall make appropriate adjustment to
the number and kind of shares as to which outstanding Options, or
portions thereof then unexercised, shall be exercisable and to the
Strike Price of the Options. Each such adjustment to outstanding
Incentive Stock Options shall be made in such a manner as not to
constitute a modification as defined in Code Section 424. If any
outstanding Options are subject to any conditions affected by the
event, the Committee shall also make appropriate adjustments to
such conditions. Any such adjustments made by the Committee shall
be conclusive.
The grant of an Option pursuant to the Plan shall not affect in
any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or
business structure or to merge or to consolidate or to dissolve,
liquidate, or to sell or transfer all or any part of its business
or assets.
Article 13
Amendment and Termination
The Board may at any time amend or terminate the Plan as it
considers advisable and in the best interests of the Company, but
no such termination or amendment may
(i) without the consent of the Optionee, adversely affect or
impair the rights of the Optionee under any outstanding
Option; or
(ii) be inconsistent with the provisions of the 1997 Program.
Article 14
Effective Date and Duration of the Plan
This Plan was initially effective as of February 17, 1990, and was
continued as a plan under the 1997 Program on the Program Adoption
Date. No Option shall be granted under the Plan after the last
permissible date for the granting of Options under the 1997
Program, but Options granted before that date may have Expiration
Dates that extend beyond such date.
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Article 15
Definitions
15.01. 1989 Program.
"1989 Program" means the Company's Long-Term Stock Incentive Program,
approved by the Company's shareholders on April 18, 1989.
15.02. 1997 Program.
"1997 Program" means the Company's 1997 Long-Term Stock Incentive
Program, approved by the Company's shareholders on April 15, 1997,
as amended from time to time.
15.03. Affiliate.
"Affiliate" means those Persons, other than Subsidiaries of the Company,
designated from time to time by the Committee as such.
15.04. Authorized Officer.
"Authorized Officer" means the Chief Executive Officer of the Company.
15.05. Board.
"Board" means the board of directors of the Company.
15.06. Change in Control.
"Change in Control" means the occurrence of any of the following events
(i) the acquisition of securities of the Company representing 20%
or more of the combined voting power of the Company's then outstanding
securities by any "person" or "group" as such terms are defined in
Sections 13(d) and 14(d) of the Exchange Act, other than
(A) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company;
(B) the Company or a Person (or one of its Subsidiaries) owned by
the stockholders of the Company in substantially the same
proportions as their ownership of the stock of the Company; or
(C) Deutsche Telekom AG or France Telecom, individually or
collectively;
(ii) at the end of any two-year period, less than a majority of
the directors of the Company are directors
(A) who were directors of the Company at the beginning of the two-
year period or
(B) whose election as director was approved by a vote of two-
thirds of the then directors described in the preceding clause
(A) or this clause (B) by prior election;
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(iii)the Company's shareholders approve a merger or consolidation
in which the Company is not the surviving entity, or a liquidation or
dissolution of the Company, or a sale of all or substantially all
of the Company's assets; or
(iv) the acquisition by Deutsche Telekom AG or France Telecom, individually
or collectively, of additional securities of the Company that
would result in their possessing in the aggregate 35% or more of
the combined voting power of the Company's then outstanding
securities.
15.07. Code.
"Code" means the Internal Revenue Code of 1986, as amended, or any
successor statute.
15.08. Code Section.
"Code Section" is a reference to a particular section of the Code, and
includes any successor provision or the same or a successor provision as
renumbered at any time.
15.09. Committee.
"Committee" means the Organization, Compensation, and Nominating
Committee of the Board.
15.10. Common Stock.
"Common Stock" means any class of the Company's publicly-traded common
stock as the Committee may determine to issue under the Plan, including
the FON Stock and the PCS Stock.
15.11. Company.
"Company" means Sprint Corporation, a Kansas corporation, or its
successor.
15.12. Corporate Secretary.
"Corporate Secretary" means the secretary of the Company.
15.13. Director.
"Director" means a member of the Board or a member of the board of
directors of a Subsidiary of the Company.
15.14. Employee.
"Employee" means an employee of the Company or a Subsidiary of the
Company.
15.15. Equity Security.
"Equity Security" means an equity security as defined by the Exchange
Act for purposes of Exchange Act Section 16.
15.16. Exchange Act.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time and as interpreted and implemented by the rules and
regulations issued thereunder.
15.17. Exchange Act Section 16.
"Exchange Act Section 16" means section 16 of the Exchange Act.
15.18. Executive Officer.
"Executive Officer" means an officer of the Company that is
subject to the liability provisions of Exchange Act Section 16.
15.19. Exercise Date.
"Exercise Date" has the meaning indicated in Section 8.01.
15.20. Exercise Price.
"Exercise Price" means, with respect to the exercise of an Option,
the Strike Price of the Option multiplied by the number of shares
with respect to which the Option is being exercised.
15.21. Expiration Date.
"Expiration Date" means, with respect to any Option, the last date on
which the Option may be exercised in the absence of an earlier
forfeiture of the Option.
15.22. Fair Market Value.
"Fair Market Value" means, with respect to any class of the Common Stock
on any date, the average of the high and low prices per share of that
class of Common Stock for composite transactions on that date, unless
there was no trading in that class of Common Stock on that date, in
which case, on the most recent day before that date on which that class
of Common Stock was traded. The Fair Market Value of shares of Restricted
Stock shall be determined without taking into account any restrictions.
"Fair Market Value" means, with respect to other property, the
value of the property as determined by the Committee.
15.23. FON Stock.
"FON Stock" means the Series 1 FON Stock as described in the
Company's articles of incorporation.
15.24. Foreign Reload Option.
"Foreign Reload Option" means a reload option issued with respect
to an option issued under a plan of Sprint's other than this Plan.
15.25. Grant Date.
"Grant Date" means, with respect to any Option, the date on which
the term of the Option begins, as determined in Article 7 and Article 11.
15.26. Grantee.
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"Grantee" means, with respect to any Option, the Director or Employee to
whom the Option was originally granted, notwithstanding any subsequent
transfer of the Option under the terms of the Plan.
15.27. Incentive Stock Option.
"Incentive Stock Option" means an Option designated as such in the action
granting the Option. This Plan's intent is that Incentive Stock Options
meet the requirements of Code Section 422.
15.28. Minimum Withholding Amount.
"Minimum Withholding Amount" means, with respect to any Option exercise,
the amount the employer is required to withhold from the income of the
Payroll Taxpayer under the Payroll Tax laws.
15.29. Non-Qualified Option.
"Non-Qualified Option" means any Option that is not an Incentive Stock Option.
15.30. Normal Retirement.
"Normal Retirement" means, with respect to any Employee, Retirement at or
later than an age qualifying as "normal retirement" under the Company's
defined benefit pension plan, whether or not the person is a participant
in the plan and, with respect to any Director, termination of service as a
Director at the mandatory retirement age for members of the Board under its
policies, as amended from time to time, even if the Director serves on the
board of a Subsidiary or Affiliate.
15.31. Notice of Exercise.
"Notice of Exercise" means the notice by an Optionee of the
exercise of an Option as set forth in Section 8.01.
15.32. Option.
"Option" means the right, set forth in a written agreement
between the Company and an Optionee, authorized by this Plan
to acquire a determinable number of shares of the Option Class
of Common Stock at a determinable price for a determinable
period of time and having such other terms as may be determined by
the Committee or Authorized Officer or as set forth in this Plan.
15.33. Option Class.
"Option Class" means, with respect to any Option, the class of
Common Stock subject to purchase pursuant to the terms of the Option.
15.34. Optionee.
"Optionee" means, with respect to any Option at any particular time,
the holder of the Option at that time.
15.35. Payroll Tax.
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"Payroll Tax" means any tax required by an employer to be withheld
from wages paid to its employees, including but not limited to
federal income tax withholding, Social Security and Medicare
withholding taxes, and state and local income tax withholding.
15.36. Payroll Taxpayer.
"Payroll Taxpayer" has the meaning specified in Section 9.01.
15.37. PCS Stock.
"PCS Stock" means the Series 1 PCS Stock as defined in the Company's
articles of incorporation.
15.38. Person.
"Person" means any individual, corporation, partnership, limited
liability company, business trust, or other entity.
15.39. Program Adoption Date.
"Program Adoption Date" means April 15, 1997.
15.40. Plan.
"Plan" means the 1990 Stock Option Plan, the terms of which are set
forth in this document.
15.41. Qualified Transferee.
"Qualified Transferee" means a Qualified Trust.
15.42. Qualified Trust.
"Qualified Trust" means a trust.
(i) that is a grantor trust treated as owned by the Grantee under
Subchapter J of the Code;
(ii) of which the Grantee, the Grantee's spouse, or the Grantee's
descendants by blood, adoption, or marriage, are the sole
beneficiaries; and
(iii)that, by its terms, may not be amended to violate the foregoing
restrictions so long as the trust is an Optionee under this Plan.
15.43. Reload Option.
"Reload Option" means an Option granted upon exercise of an Option
having Reload Rights under the terms and conditions set forth in
Article 11
15.44. Restricted Shares.
"Restricted Shares" means shares of Common Stock subject to
restrictions on transfer and the possibility of forfeiture for any
period of time.
15.45. Retirement.
"Retirement" means, in the case of an Employee, termination of
employment by an employee who is entitled to receive payment of
pension benefits in accor-
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dance with the Sprint Retirement Pension Plan or his employer's defined
benefit pension plan, if any, immediately after the employee's
Termination Date and, in the case of a Director, termination of service
as a Director after five years of service as a Director.
15.46. Seasoned Shares.
"Seasoned Shares" means, with respect to any Person, shares of Common
Stock
(i) acquired by such Person from the Company and owned by such
Person for a period of at least six months; or
(ii) acquired by such Person other than from the Company.
15.47. Securities Act.
"Securities Act" means the Securities Act of 1933, as amended from
time to time and as interpreted and implemented by the rules and
regulations issued thereunder.
15.48. Strike Price.
"Strike Price" means, with respect to any Option, the price per share
at which the Optionee is entitled to purchase shares of Common Stock.
15.49. Subsidiary.
"Subsidiary" means, with respect to any Person (the "Controlling Person"),
(i) all Persons (the "Controlled Persons") in whom the Controlling
Person, together with its Subsidiaries, directly owns more than
50% of the voting rights, and
(ii) all Subsidiaries of the Controlled Persons.
15.50. Tax Date.
"Tax Date" means, with respect to any Option exercise, the date on
which the shares issued pursuant to the Option exercise become subject
to federal income taxation.
15.51. Termination Date.
"Termination Date" means,
(i) with respect to any Employee, the date on which the Employee
ceases to be employed by the Company, any of its Subsidiaries,
or any Affiliate, and ceases to receive severance benefits under
any applicable plans for the payment of severance benefits by the
employing entity, or
(ii) with respect to any Director, the date on which the
Director's service as a director ends.
15.52. Termination for Cause.
In the case of an Employee, "Termination for Cause" means an involuntary
termination of employment because
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(i) the employee has materially breached the Company's Code of
Ethics, or the code of ethics of the employer;
(ii) the employee has materially breached the Sprint Employee
Agreement Regarding Property Rights and Business Practices;
(iii)the employee has engaged in acts or omissions constituting
dishonesty, intentional breach of a fiduciary obligation, or
intentional acts of wrongdoing or misfeasance; or
(iv) the employee has acted intentionally and in bad faith in a
manner that results in a material detriment to the assets,
business, or prospects of the employer.
In determining whether any particular employee was Terminated for
Cause, the characterization of the reason for termination used for
purposes of other employee benefit plans of the Company or other
employer shall apply to this Plan.
In the case of a Director, "Termination for Cause" means removal
for cause from service as a director.
15.53. Total Disability.
"Total Disability" means, in the case of employees, termination
of employment under circumstances that would make the employee
eligible to receive benefits under the employer's long-term
disability plan and, in the case of Directors, termination of
service as a Director under circumstances that would make the
Director eligible to receive Social Security disability benefits.
15.54. Underlying Option.
"Underlying Option" means, with respect to any Reload Option, the
Option to which the Reload Rights were attached and the exercise
of which resulted in the grant of the Reload Option.
15.55. Vesting Period.
"Vesting Period" means, with respect to any Restricted Shares,
the period of time during which the Restricted Shares (i) are
subject to limitations on transfer and (ii) may be divested from
the owner upon failure to meet any applicable conditions to vesting.
15.56. Withholding Amount.
"Withholding Amount" has the meaning specified in Section 9.02.
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