Sprint Nextel Corp. (S) disclosed Friday that its board approved a new deferred compensation plan, to be effective Jan. 1, 2006.
Eligible participants will be employees of the communications company and its units at director level and above and outside directors, according to a document filed with the Securities and Exchange Commission.
Sprint Nextel said eligible employees will be allowed to elect, in the year before the compensation is earned, to contribute up to 75% of base salary and up to 100% of incentive compensation, in increments of 1%, to the deferred compensation plan.
Outside directors will be allowed to contribute up to 100% of director fees in increments of 1%, the filing said.
The company said that all contributions, and earnings credited to contributions, will be 100% vested.
Investment options will be selected by the employee benefits committee in a manner designed to offer diversification across asset classes, according to the filing.
The investment options will include phantom share units representing shares of Sprint Nextel common stock. All investments will be unfunded obligations of Sprint Nextel.
The company said participants will be able to transfer between investment options on any business day, but only four transfers may be made in each calendar year and three months must elapse between transfers.
In addition, participants will be able to elect payment of benefits to begin on a specified date at least five years in the future or upon termination of employment, the filing said.
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