The spatial reference of the output feature dataset. You can specify the spatial reference in the following ways:
Enter the path to a .prj file, such as C:/workspace/watershed.prj.
Reference a feature class or feature dataset whose spatial reference you want to apply, such as C:/workspace/myproject.gdb/landuse/grassland.
Define a spatial reference object prior to using this tool, such as sr = arcpy.SpatialReference("C:/data/Africa/Carthage.prj"), which you then use as the spatial reference parameter.
And it is annoying: