Document:

HSP-EX10.6_2014.3.31-10Q

HOSPIRA 2004 LONG-TERM STOCK INCENTIVE PLAN
NQSO TERMS
The Participant specified below has been granted this Option by Hospira, Inc. (the “Company”) under the terms of the Hospira 2004 Long-Term Stock Incentive Plan (the “Plan”).  The Option shall be subject to the following terms and conditions (the “Option Terms”):
1.Terms of Award.  The following words and phrases relating to the grant of the Option shall have the following meanings:
(a)    The “Participant” is _________________.
(b)    The “Grant Date” is ____________________.
(c)    The number of “Covered Shares” shall be ________ shares of Stock.
(d)    The “Exercise Price” is $                    per share.
Except where the context clearly implies to the contrary, any capitalized term in this award shall have the meaning ascribed to that term under the Plan.
2.    Non‐Qualified Stock Option.  The Option is not intended to constitute an “incentive stock option” as that term is used in Code section 422.
3.    Date of Exercise.  Subject to the limitations of the Option Terms, on the first anniversary of the Grant Date one-quarter of the Covered Shares subject to these Options (rounded up) may be purchased; on the second anniversary of the Grant Date one-half of the Covered Shares subject to these Options (rounded up) may be purchased; on the third anniversary of the Grant Date three-quarters of the Covered Shares subject to these Options (rounded up) may be purchased; and on the fourth anniversary of the Grant Date these Options may be exercised in full, provided the Expiration Date has not occurred prior to such vesting dates.
(a)    Notwithstanding the foregoing provisions of this paragraph 3, the Option shall become fully exercisable upon the date of a Change in Control that occurs on or before the Date of Termination if the successor company (or parent thereof) has not either (i) assumed the Option effective on the date of the Change in Control, without any modifications except as provided in the next sentence, or (ii) replaced it with a comparable option as of such date having the same intrinsic value as the Option, and the same vested percentage and vesting schedule as the Option.  The Option (if assumed) or the replacement option shall provide for full vesting if, within the first 24 months following the date of the Change in Control, the Participant is involuntarily terminated for any or no reason or if the Participant terminates with Good Reason.

	
			
	 
	 
	 

(b)    The Option may be exercised (prior to or following the Date of Termination) only as to that portion of the Covered Shares which may be purchased under the foregoing schedule, as of the date of exercise.  
(c)    The Covered Shares shall continue to become exercisable pursuant to this Section 3 until the Expiration Date (as defined in Section 4).  
(d)    Notwithstanding the foregoing provisions of this paragraph 3, in the event of termination of employment for reasons other than death, Disability or Retirement, the Option may only be exercised on or after the Date of Termination only as to that portion of the Covered Shares for which it was exercisable immediately prior to the Date of Termination, or became exercisable on the Date of Termination.
4.    Expiration.  The Option shall not be exercisable after the Company’s close of business on the last business day that occurs prior to the Expiration Date.  The “Expiration Date” shall be the earliest to occur of:
(a)    the seven‐year anniversary of the Grant Date;
(b)    if the termination of employment occurs for reasons other than death, Disability (as defined in Section 10) or Retirement (as defined in Section 10), the three-month anniversary of the Date of Termination (as defined in Section 10); provided, however, that if the Participant dies during such three month period following the Date of Termination, then the three-month anniversary of the date of death; 
(c)    the date on which the Participant engages in conduct which constitutes Cause; 
(d)    the date on which the Participant, at any time prior to the one-year anniversary of the Date of Termination, engages, directly or indirectly, for the benefit of the Participant or others, in any activity, employment or business which, in the sole opinion and discretion of the Committee, is competitive with the Company or any of its Subsidiaries; 
(e)    as provided under Restricted Activity in Section 5; or
(f)    as provided under Other Right to Correct Payments in Section 6.

5.    Restricted Activity.
(a)                The Participant shall not, while employed by the Company and for a period of one year following the termination of employment for any reason: 

	
			
	 
	2

	 

(i)                  without the prior written consent of the Committee, directly or indirectly engage or assist any person engaging in any Competitive Business (as defined in Section 10), individually, or as an officer, director, employee, agent, consultant, owner, partner, lender, manager, member, principal, or in any other capacity, or render any services to any entity that is engaged in any Competitive Business; provided, however, that the Participant’s ownership of 1% of any class of equity security of any entity engaged in any Competitive Business shall not be deemed a breach of this Section 5(a) provided such securities are listed on a national securities exchange or quotation system or have been registered under Section 12(g) of the Securities Exchange Act of 1934, as amended; or 
(ii)                directly or indirectly divert, take away, solicit, or assist others in soliciting any current or prospective customer, supplier, independent contractor or service provider of the Company or any affiliate or otherwise interfere with the relationship between the Company or any affiliate and any current or prospective customer, service provider, supplier, independent contractor or stockholder.  
(b)        The Participant shall not, while employed by the Company and for a period of two years following the termination of employment for any reason: directly or indirectly induce any person to leave employment with the Company, or solicit for employment other than on behalf of the Company, offer employment to, or employ, any person who was an employee of the Company, in each case within six months of such inducement, solicitation, or offer.
(c)               If the Participant engages in any activity described in paragraph 5(a) or paragraph 5(b) above without the written consent of the Committee, the Company, as determined by the Committee in its sole discretion, may (i) cancel and terminate all of the Participant’s unexercised, unexpired or unpaid Options (whether vested or unvested) under the Plan, and (ii) rescind any exercise, payment or delivery under any Option occurring within 12 months prior to, or at any time following, the date of the Participant’s termination of employment for any reason.  Upon any such rescission, the Participant shall immediately (A) pay to the Company the amount of any gain realized or payment received, and (B) forfeit to the Company any Shares received as a result of the rescinded exercise, payment or delivery under any Options, in such manner and on such terms and conditions as the Committee shall require, and the Company shall be entitled, as permitted by applicable law, to deduct from any amounts the Company owes the Participant from time to time the amount of any such gain realized or payment received.  “Gain realized” shall be the excess of the Fair Market Value of the Shares on the date of exercise over the Exercise Price, multiplied by the number of Shares purchased.

	
			
	 
	3

	 

6.    Other Right to Correct Payments.  Subject to the Company’s Executive Compensation Recovery Policy, and notwithstanding anything in the Option Terms to the contrary, if the Committee determines, in its sole discretion, that the number of Covered  Shares determined to be delivered under the Option Terms or the value of such Options was based on the Company’s published financial statements that have been restated then, at the Committee’s direction, the Company may, but in no case later than 60 months of such restatement: 
(a)     cancel all unexercised, unexpired or unpaid Options (whether vested or unvested) under the Plan that were based upon the financial performance in the published financial statements that was subsequently restated; 
(b)     rescind any exercise, payment or delivery under any Option that were based upon the financial performance in the published financial statements that was subsequently restated; and 
(c)     if any amount has been realized from exercised Options that would have been lower had the financial results been properly reported, recover all or any gain realized by the Participant, as determined by the Committee in its sole discretion, under the Option Terms that resulted from the financial results that were subsequently restated, and the Participant agrees to repay and return any such gain realized to the Company. 
The Committee may, in its sole discretion, effect any such recovery by obtaining repayment directly from the Participant, setting off the amount owed to the Company against any amount or award that would otherwise be granted by the Company to the Participant, reducing any future compensation or benefit to the Participant or any combination thereof.  “Gain realized” shall be as determined under Section 5(c). 
7.    Method of Option Exercise.  Subject to the Option Terms and the Plan, the Option may be exercised in whole or in part by filing a written notice with the Secretary of the Company at its corporate headquarters prior to the Company’s close of business on the last business day that occurs prior to the Expiration Date.  Such notice shall specify the number of shares of Stock which the Participant elects to purchase, and shall be accompanied by payment of the Exercise Price for such shares of Stock indicated by the Participant’s election. Payment may be by cash or by check payable to the Company, or except as otherwise provided by the Committee before the Option is exercised: (i) all or a portion of the Exercise Price may be paid by the Participant by delivery of shares of Stock (by actual delivery or by attestation) owned by the Participant and acceptable to the Committee having an aggregate Fair Market Value (valued as of the date of exercise) that is equal to the amount of cash that would otherwise be required; and (ii) the Participant may pay the Exercise Price by authorizing a third party to sell shares of Stock (or a sufficient portion of the shares) acquired upon exercise of the Option and remit to the Company a sufficient portion of the sale proceeds to pay the entire Exercise Price and any tax withholding resulting from such exercise.  Except as otherwise provided by the Committee prior to exercise, payments 

	
			
	 
	4

	 

made with shares of Stock in accordance with clause (i) above shall be limited to shares held by the Participant for not less than six months prior to the payment date.  The Option shall not be exercisable if and to the extent the Company determines that such exercise would violate applicable state or Federal securities laws or the rules and regulations of any securities exchange on which the Stock is traded and shall not be exercisable during any blackout period established by the Company from time to time.

8.    Withholding.  The exercise of the Option is subject to withholding of all applicable taxes.  At the election of the Participant, and subject to such rules and limitations as may be established by the Committee from time to time, such withholding obligations may be satisfied (i) through cash payment by the Participant; (ii) through the surrender of shares of Stock by (actual delivery or by attestation) which the Participant already owns (provided, however, that to the extent shares described in this clause (ii) are used to satisfy more than the minimum statutory withholding obligation, as described below, then, except as otherwise provided by the Committee, payments made with shares of Stock in accordance with this clause (ii) shall be limited to shares held by the Participant for not less than six months prior to the payment date); or (iii) through the surrender of shares of Stock to which the Participant is otherwise entitled under the Plan; provided, however, that such shares under this clause (iii) may be used to satisfy not more than the Company’s minimum statutory withholding obligation (based on minimum statutory withholding rates for Federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income).

9.    Transferability.  The Option is not transferable by the Participant other than by will or by the laws of descent and distribution, and during the Participant’s life, may be exercised only by the Participant.  It may not be assigned, transferred (except as aforesaid), pledged or hypothecated by the Participant in any way whether by operation of law or otherwise, and shall not be subject to execution, attachment or similar process.  Any attempt at assignment, transfer, pledge or hypothecation, or other disposition of this Option contrary to the provisions hereof, and the levy of any attachment or similar process upon this Option, shall be null and void and without effect.
10.    Definitions.  For purposes of the Option Terms, words and phrases shall be defined as follows:
(a)    Cause.  The term “Cause” means, in the sole opinion and discretion of the Committee, the Participant has (i) engaged in a material breach of the Company’s code of business conduct, (ii) committed an act of fraud, embezzlement or theft in connection with the Participant’s duties or in the course of employment, or (iii) wrongfully disclosed secret processes or confidential information of the Company or its subsidiaries.
(b)    Competitive Business.  The term “Competitive Business” means any business activity in which the Company or any Subsidiary is actively 

	
			
	 
	5

	 

engaged at the time the Participant’s employment terminates.  For these purposes, entities deemed to be engaged in Competitive Business include, by way of example and not limitation, Abraxis BioScience, Inc., Baxter International Inc., Teva Pharmaceuticals, Becton, Dickinson and Company, B. Braun Melsungen AG, Cardinal Healthcare Inc., Fresenius Medical Care AG, Terumo Medical Corporation, Patheon, Inc., and Edwards Lifesciences Corporation.
(c)    Date of Termination.  The term “Date of Termination” means the first day occurring on or after the Grant Date on which the Participant is not employed by the Company or any Subsidiary (including the first day of a leave classified within the Company’s Human Resources System as a Pay Continuation Leave), regardless of the reason for the termination of employment; provided that a termination of employment shall not be deemed to occur by reason of a transfer of the Participant between the Company and a Subsidiary or between two Subsidiaries; and further provided that, except for a leave classified as a Pay Continuation Leave, the Participant’s employment shall not be considered terminated while the Participant is on a leave of absence from the Company or a Subsidiary approved by the Participant’s employer.  If, as a result of a sale or other transaction, the Participant’s employer ceases to be a Subsidiary (and the Participant’s employer is or becomes an entity that is separate from the Company), and the Participant is not, at the end of the 30‐day period following the transaction, employed by the Company or an entity that is then a Subsidiary, then the occurrence of such transaction shall be treated as the Participant’s Date of Termination caused by the Participant being discharged by the employer.
(d)    Disability.  The term “Disability” means the Participant’s disability as defined in the Hospira Long Term Disability Plan, whether or not such Participant is a participant in such disability plan, for a period of twelve (12) consecutive months.
(e)    Good Reason.  The term “Good Reason” means the occurrence of any of the following circumstances without the Participant's express written consent:
		
	(i)
	a significant adverse change in the nature, scope or status of the Participant's position, authorities or duties from those in effect immediately prior to the Change in Control, including, without limitation, if the Participant was, immediately prior to the Change in Control, an executive officer of a public company, the Participant ceasing to be an executive officer of a public company;

		
	(ii)
	the failure by the Company to pay the Participant any portion of the Participant's current compensation; 

	
			
	 
	6

	 

		
	(iii)
	a reduction in the Participant's annual base salary (or a material change in the frequency of payment) as in effect immediately prior to the Change in Control as the same may be increased from time to time;

		
	(iv)
	the failure by the Company to award the Participant an annual bonus in any year which is at least equal to the annual bonus, awarded to the Participant under the annual bonus plan of the Company for the year immediately preceding the year of the Change in Control; 

		
	(v)
	the failure by the Company to award the Participant equity-based incentive compensation (such as stock options, shares of restricted stock, or other equity-based compensation) on a periodic basis consistent with the Company's practices with respect to timing, value and terms prior to the Change in Control;

		
	(vi)
	the failure by the Company to continue to provide the Participant with the welfare benefits, fringe benefits and perquisites enjoyed by the Participant immediately prior to the Change in Control under any of the Company's plans or policies, including, but not limited to, those plans and policies providing pension, life insurance, medical, dental, prescription, health and accident, disability, vacation, and other executive perquisites; 

		
	(vii)
	the relocation of the Company's principal executive offices to a location more than thirty-five miles from the location of such offices immediately prior to the Change in Control or the Company requiring the Participant to be based anywhere other than the Company's principal executive offices except for required travel to the Company's business to an extent substantially consistent with the Participant's business travel obligations immediately prior to the Change in Control; or 

		
	(viii)
	the failure of the Company to obtain a satisfactory agreement from any successor to the Company to assume and agree to perform this Agreement as contemplated by paragraph 3. 

For purposes of any determination regarding the existence of Good Reason, any good faith determination by the Participant that Good Reason exists shall be conclusive.

	
			
	 
	7

	 

(f)    Retirement.  “Retirement” of the Participant means, the occurrence of the Participant’s Date of Termination on or after the date that the Participant reaches the age of 55 and has 10 years of combined service with the Company or its subsidiaries (or with Abbott Laboratories and its affiliates, provided that the Participant transitioned employment from Abbott to the Company in conjunction with the distribution of the Company’s common stock to the Abbott shareholders) (as determined by the Committee).
11.    Heirs and Successors.  The Option Terms shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, and upon any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets and business.
12.    Administration.  The authority to manage and control the operation and administration of the Option Terms shall be vested in the Committee, and the Committee shall have all powers with respect to the Option Terms as it has with respect to the Plan. Any interpretation of the Option Terms by the Committee and any decision made by it with respect to the Option Terms is final and binding on all persons.
13.    Plan Governs. Notwithstanding anything in the Option Terms to the contrary, the Option Terms shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the office of the Secretary of the Company; and the Option Terms is subject to all interpretations, amendments, rules and regulations promulgated by the Committee from time to time pursuant to the Plan.
14.    Not An Employment Contract. The Option will not confer on the Participant any right with respect to continuance of employment or other service with the Company or any Subsidiary, nor will it interfere in any way with any right the Company or any Subsidiary would otherwise have to terminate or modify the terms of such Participant’s employment or other service at any time.
15.    Notices.  Any written notices provided for in the Option Terms or the Plan shall be in writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail. Notices sent by mail shall be deemed received three business days after mailing but in no event later than the date of actual receipt. Notices shall be directed, if to the Participant, at the Participant’s address indicated by the Company’s records, or if to the Company, at the Company’s principal executive office.
16.    Fractional Shares. In lieu of issuing a fraction of a share upon any exercise of the Option, resulting from an adjustment of the Option pursuant to paragraph 3.4 of the Plan or otherwise, the Company will be entitled to pay to the Participant an amount equal to the fair market value of such fractional share.

	
			
	 
	8

	 

17.    No Rights As Shareholder.  The Participant shall not have any rights of a shareholder with respect to the shares subject to the Option, until a stock certificate has been duly issued following exercise of the Option as provided herein.
18.    Amendment.  The Option Terms may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written agreement of the Participant and the Company without the consent of any other person.
IN WITNESS WHEREOF, the Company has caused these presents to be executed in its name and on its behalf, all as of the Grant Date.
Hospira, Inc.

By:      
Its:     

	
			
	 
	9HSP-EX10.7_2014.3.31-10Q

HOSPIRA 2004 LONG-TERM STOCK INCENTIVE PLAN
RESTRICTED STOCK UNIT AGREEMENT
This Restricted Stock Unit Agreement (the “Agreement”) is made between Hospira, Inc., a Delaware corporation (the “Company”), and the Participant specified below.  The Agreement is subject to the provisions of the Hospira 2004 Long-Term Stock Incentive Plan (the “Plan”), the terms of which are incorporated herein by reference.
1.Terms of Award.  The following terms used in this Agreement shall have the meanings set forth in this paragraph 1:
(a)    The “Participant” is David J. Endicott.
(b)    The “Grant Date” is March 31, 2014.
		
	(c)
	The number of “Restricted Stock Units” awarded under this Agreement is 58,126.  “Restricted Stock Units” are units of shares of Stock representing the right to receive an equal number of shares of Stock on a Delivery Date.

		
	(d)
	The "Delivery Dates" are the respective dates on which Restricted Stock Units vest and the shares of Stock represented by the Restricted Stock Units become deliverable to the Participant pursuant to paragraph 4 below. The shares of Stock shall be delivered in an equal whole number of shares of Stock (plus cash equal to the Fair Market Value of any fractional share) to the Participant, or to his/her personal representative in the event of the Participant’s death or Disability, on the Delivery Date or within 30 days following such Delivery Date. 

Except where the context clearly implies to the contrary, any capitalized term in this award shall have the meaning ascribed to that term under the Plan.  Other words and phrases used in this Agreement are defined pursuant to paragraph 9 or elsewhere in this Agreement.
2.    Award.  The Participant is hereby awarded the number of Restricted Stock Units set forth in paragraph 1.
3.    Dividends and Voting Rights.  Prior to each applicable Delivery Date of the shares of Stock represented by Restricted Stock Units: (a) the Participant shall not be treated as a shareholder as to those shares, and shall only have contractual rights to receive them, unsecured by any assets of the Company or its subsidiaries; (b) the Participant shall not be permitted to vote the Restricted Stock Units; (c) neither dividends nor dividend equivalents shall be paid or accrued with respect to the 

	
			
	 
	 
	 

Restricted Stock Units; and (d) the Participant's right to receive shares with respect to the Restricted Stock Units shall be subject to the adjustment provisions relating to mergers, reorganizations and similar events set forth in the Plan. 
4.    Forfeiture Period.  
		
	(a)
	The Restricted Stock Units shall be subject to forfeiture pursuant to paragraph 4(d) for a period (the "Forfeiture Period") commencing with the date of the award and ending on the earliest to occur of the events described in paragraphs 4(b) and 4(c).

		
	(b)
	The Restricted Stock Units shall vest on each consecutive anniversary date of the Grant Date with respect to one-fourth of the Restricted Stock Units (each such anniversary date a “Delivery Date”).

		
	(c)
	The Restricted Stock Units to the extent they have not vested in accordance with paragraph 4(b) and to the extent they have not previously been forfeited, shall vest upon the date of a Change in Control that occurs on or before the Date of Termination if the successor company (or parent thereof) has not either (i) assumed the Restricted Stock Units effective on the date of the Change in Control, without any modifications except as provided in the next sentence, or (ii) replaced it with comparable restricted stock units as of such date having the same intrinsic value as the Restricted Stock Units, and the same vested percentage and vesting schedule as the Restricted Stock Units.  The Restricted Stock Units (if assumed) or the replacement restricted stock units shall provide for full vesting if, within the first 24 months following the date of the Change in Control, the Participant is involuntarily terminated for any or no reason or if the Participant terminates with Good Reason.

		
	(d)
	The Restricted Stock Units shall be automatically forfeited upon the earliest to occur of the following: (i) the Participant’s Date of Termination for any reason other than death, Disability or Retirement; or (ii) subject to the provisions of Section 5, the date the Participant engages in conduct which constitutes Restricted Activity. 

5.    Restricted Activity.
		
	(a)
	The Participant shall not, while employed by the Company and for a period of one year following his/her Date of Termination: 

		
	(i)
	without the prior written consent of the Committee, directly or indirectly engage or assist any person engaging in any 

	
			
	 
	2

	 

Competitive Business individually, or as an officer, director, employee, agent, consultant, owner, partner, lender, manager, member, principal or in any other capacity, or render any services to any entity that is engaged in any Competitive Business; provided, however, that the Participant’s ownership of 1% of any class of equity security of any entity engaged in any Competitive Business shall not be deemed a breach of this paragraph 5(a) provided such securities are listed on a national securities exchange or quotation system or have been registered under Section 12(g) of the Securities Exchange Act of 1934, as amended; or 
		
	(ii)
	directly or indirectly divert, take away, solicit, or assist others in soliciting any current or prospective customer, supplier, independent contractor or service provider of the Company or any subsidiary or otherwise interfere with the relationship between the Company or any subsidiary and any current or prospective customer, service provider, supplier, independent contractor or stockholder; or 

		
	(iii)
	directly or indirectly induce any person to leave employment with the Company, or solicit for employment other than on behalf of the Company, offer employment to, or employ, any person who was an employee of the Company, in each case within six months of such inducement, solicitation or offer.

		
	(b)
	If the Participant engages in any activity described in paragraph 5(a) without the written consent of the Committee, the Company, as determined by the Committee in its sole discretion, may terminate this Agreement and forfeit all of the Restricted Stock Units (whether vested or unvested), and the Participant shall immediately pay to the Company in cash the amount of any Financial Gain realized by the Participant from the vesting of the Restricted Stock Units, provided that such vesting occurred within one year from the date that the Participant engaged in such Restricted Activity.  The Committee may, in its sole discretion, recover any amount owed by the Participant by setting off such amount against any amount or award that would otherwise be granted or paid by the Company to the Participant, reducing any future compensation or benefit to the Participant or any combination thereof.  

6.    Other Right to Correct Payments.  Subject to the Company’s Executive Compensation Recovery Policy, and notwithstanding anything in the Agreement to the contrary, if the Committee determines, in its sole discretion, that the number or value of Restricted Stock Units awarded under the Agreement was based on 

	
			
	 
	3

	 

the Company’s published financial statements that have been restated then, at the Committee’s discretion, the Company may, but in no case later than 60 months of such restatement: 
		
	(a)
	cancel all Restricted Stock Units (whether vested or unvested) that were based upon the financial performance in the published financial statements that was subsequently restated; 

		
	(b)
	rescind any delivery of shares of Stock that was based upon the financial performance in the published financial statements that was subsequently restated; and 

		
	(c) 
	if any amount or value has been realized from the vesting of the Restricted Stock Units that would have been lower had the financial results been properly reported, recover all or any Financial Gain realized by the Participant, as determined by the Committee in its sole discretion, that resulted from the financial results that were subsequently restated, and the Participant agrees to repay and return any such Financial Gain to the Company. The Committee may, in its sole discretion, effect any such recovery by obtaining repayment directly from the Participant, setting off the amount owed to the Company against any amount or award that would otherwise be granted by the Company to the Participant, reducing any future compensation or benefit to the Participant or any combination thereof.  

7.    Award Not Transferable.  The Restricted Stock Units may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, whether by operation of law or otherwise, and shall not be subject to execution, attachment or similar process.  Any attempt at assignment, transfer, pledge or hypothecation, or other disposition of the Restricted Stock Units contrary to the provisions hereof, and the levy of any attachment or similar process upon the Restricted Stock Units, shall be null and void and without effect.
8.    Withholding. The Company is entitled to withhold an amount equal to the Company’s required statutory withholding taxes for the respective tax jurisdiction attributable to any share of Common Stock or cash deliverable in connection with the Restricted Stock Units.  Subject to such limitations as the Company may establish from time to time, the Participant may satisfy any withholding obligation in whole or in part by making a cash payment equal to the amount required to be withheld. 
9.    Definitions.  For purposes of this Agreement, the terms used in this Agreement shall be subject to the following:
		
	(a)
	Competitive Business.  The term “Competitive Business” means any business activity in which the Company or any subsidiary is 

	
			
	 
	4

	 

actively engaged on the Participant’s Date of Termination.  For these purposes, entities deemed to be engaged in Competitive Business include, by way of example and not limitation, Abraxis BioScience, Inc., Baxter International Inc., Teva Pharmaceuticals, Becton, Dickinson and Company, B. Braun Melsungen AG, Cardinal Healthcare Inc., Fresenius Medical Care AG, Terumo Medical Corporation, Patheon, Inc., and Edwards Lifesciences Corporation.
		
	(b)
	Date of Termination.  The term “Date of Termination” means the first day occurring on or after the Grant Date on which the Participant is not employed by the Company or any of its subsidiaries (including the first day of a leave classified within the Company’s Human Resources System as a Pay Continuation Leave), regardless of the reason for the termination of employment; provided that a termination of employment shall not be deemed to occur by reason of a transfer of the Participant between the Company and a subsidiary or between two subsidiaries; and further provided that, except for a leave classified as a Pay Continuation Leave, the Participant’s employment shall not be considered terminated while the Participant is on a leave of absence from the Company or a subsidiary approved by the Participant’s employer.  If, as a result of a sale or other transaction, the Participant’s employer ceases to be a subsidiary (and the Participant’s employer is or becomes an entity that is separate from the Company), and the Participant is not, at the end of the 30‐day period following the transaction, employed by the Company or an entity that is then a subsidiary, then the occurrence of such transaction shall be treated as the Participant’s Date of Termination caused by the Participant being discharged by the employer.

		
	(c)
	Disability.  The term “Disability” means the Participant either is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months;  or by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, the Participant is receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company or a subsidiary.

		
	(d)
	Financial Gain.  The term “Financial Gain” means the Fair Market Value of the Common Stock on the Delivery Date that the Restricted Stock Unit is deemed vested, multiplied by the number 

	
			
	 
	5

	 

of shares of Stock actually distributed pursuant to this Agreement, reduced by any taxes paid in countries other than the United States, to the extent that such taxes are not otherwise eligible for refund from the taxing authorities.
		
	(e)
	Good Reason.  The term “Good Reason” means the occurrence of any of the following circumstances without the Participant's express written consent:

		
	(i)
	a significant adverse change in the nature, scope or status of the Participant's position, authorities or duties from those in effect immediately prior to the Change in Control, including, without limitation, if the Participant was, immediately prior to the Change in Control, an executive officer of a public company, the Participant ceasing to be an executive officer of a public company;

		
	(ii)
	the failure by the Company to pay the Participant any portion of the Participant's current compensation; 

		
	(iii)
	a reduction in the Participant's annual base salary (or a material change in the frequency of payment) as in effect immediately prior to the Change in Control as the same may be increased from time to time;

		
	(iv)
	the failure by the Company to award the Participant an annual bonus in any year which is at least equal to the annual bonus, awarded to the Participant under the annual bonus plan of the Company for the year immediately preceding the year of the Change in Control; 

		
	(v)
	the failure by the Company to award the Participant equity-based incentive compensation (such as stock options, shares of restricted stock, or other equity-based compensation) on a periodic basis consistent with the Company's practices with respect to timing, value and terms prior to the Change in Control;

		
	(vi)
	the failure by the Company to continue to provide the Participant with the welfare benefits, fringe benefits and perquisites enjoyed by the Participant immediately prior to the Change in Control under any of the Company's plans or policies, including, but not limited to, those plans and policies providing pension, life insurance, medical, dental, prescription, health and accident, disability, vacation, and other executive perquisites; 

	
			
	 
	6

	 

		
	(vii)
	the relocation of the Company's principal executive offices to a location more than thirty-five miles from the location of such offices immediately prior to the Change in Control or the Company requiring the Participant to be based anywhere other than the Company's principal executive offices except for required travel to the Company's business to an extent substantially consistent with the Participant's business travel obligations immediately prior to the Change in Control; or 

		
	(viii)
	the failure of the Company to obtain a satisfactory agreement from any successor to the Company to assume and agree to perform this Agreement as contemplated by paragraph 4. 

For purposes of any determination regarding the existence of Good Reason, any good faith determination by the Participant that Good Reason exists shall be conclusive.
		
	(f)
	Retirement.  “Retirement” of the Participant means, the occurrence of the Participant’s Date of Termination on or after the date that the Participant reaches the age of 55 and has 10 years of combined service with the Company or its subsidiaries (or with Abbott Laboratories and its affiliates, provided that the Participant transitioned employment from Abbott to the Company in conjunction with the distribution of the Company’s common stock to the Abbott shareholders) (as determined by the Committee).

10.    Successors.  This Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, and upon any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s assets and business.  
11.    Not An Employment Contract. Restricted Stock Units do not confer on the Participant any right with respect to continuance of employment or other service with the Company or any of its subsidiaries, nor will it interfere in any way with any right the Company or any of its subsidiaries would otherwise have to terminate or modify the terms of such Participant’s employment or other service at any time.
12.    Administration.  The authority to manage and control the operation and administration of this Agreement shall be vested in the Committee, and the Committee shall have all powers with respect to this Agreement as it has with respect to the Plan.  Any interpretation of the Agreement by the Committee and any decision made by it with respect to the Agreement is final and binding.
13.    Notices.  Any written notice from one party to the other that is related to this Agreement shall be in writing and shall be deemed sufficiently given if 

	
			
	 
	7

	 

either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail.  Notices sent by mail shall be deemed received three business days after mailing but in no event later than the date of actual receipt. Notices shall be directed, if to the Participant, at the Participant's address indicated by the Company's records, or if to the Company, at the Company's principal executive office.
14.    Plan Governs.  Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the office of the Secretary of the Company.
15.    Amendment.  This Agreement may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written agreement of the Participant and the Company without the consent of any other person.  Notwithstanding the foregoing, the terms of the Agreement may be amended by Hospira as it shall deem necessary and appropriate in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and any proposed, temporary or final regulations promulgated thereunder.
* * * * * * *
IN WITNESS WHEREOF, the Participant has executed this Agreement, and the Company has caused these presents to be executed in its name and on its behalf, all as of the Grant Date.
Participant

    

Hospira, Inc.

By:     
Its:  Chief Executive Officer 

	
			
	 
	8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00230-of-00352.parquet"}]]