Document:

Exhibit 10.6(d)

 

HOSPIRA 2004
LONG-TERM STOCK INCENTIVE PLAN

 

RESTRICTED STOCK
AGREEMENT

 

This Restricted Stock Agreement (“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 Sumant Ramachandra.

 

(b)           The “Grant
Date” is September 30, 2008.

 

(c)           The
number of shares of “Covered Shares” awarded under this Agreement is 15,000.  “Covered Shares” are shares of Stock granted
under this Agreement and are subject to the terms of this Agreement and the
Plan.

 

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 8 or
elsewhere in this Agreement.

 

2.             Award.  The Participant is hereby granted the number
of Covered Shares set forth in paragraph 1.

 

3.             Dividends
and Voting Rights.  The Participant
shall be entitled to receive any dividends paid with respect to the Covered
Shares that become payable during the Restricted Period (defined below);
provided, however, that no dividends shall be payable to or for the benefit of
the Participant for Covered Shares with respect to record dates occurring prior
to the Grant Date, or with respect to record dates occurring on or after the
date, if any, on which the Participant has forfeited those Covered Shares.  Any such dividends paid with respect to the
Covered Shares during the Restricted Period shall be paid at the same time as they are paid to other
shareholders of common shares of the Company.  The Participant shall be entitled to vote the
Covered Shares during the Restricted Period to the same extent as would have
been applicable to the Participant if the Participant was then vested in the
shares; provided, however, that the Participant shall not be entitled to vote
the shares with respect to record dates for such voting rights arising prior to
the Grant Date, or with respect to record dates occurring on or after the date,
if any, on which the Participant has forfeited those Covered Shares. Any
additional common shares of the Company issued with respect to the Covered
Shares as a result of any stock dividend, stock split or reorganization, shall
be subject to the restrictions and other provisions of paragraphs 5, 6 and 7.

 

4.             Issuance
of Certificate.  Each certificate
issued in respect of the Covered Shares granted under this Agreement shall be
registered in the name of the Participant and shall be deposited in a bank
designated by the Committee or retained by the Company.  The 

 

 

certification of Covered Shares is conditioned upon
the Participant endorsing in blank a stock power for the Covered Shares.  During the Restricted Period, all
certificates evidencing the Restricted Stock will be imprinted with the
following legend: “The securities evidenced by this certificate are subject to
the transfer restrictions, forfeiture restrictions and other provisions of the
Restricted Stock Agreement dated March 31, 2008 between Hospira and Brian R. Woodworth.” Upon lapse of the
Restriction Period, the Participant shall be entitled to have the legend
removed from the certificate representing the Covered Shares.

 

5.             Restricted
Period.  The Covered Shares shall be
subject to forfeiture pursuant to Section 6 for a period (the “Forfeiture
Period”) commencing with the date of the award and ending on the earliest
of the following events:

 

(a)           The three-year
anniversary of the Grant Date;

 

(b)           The date of
a Change in Control that occurs on or before the Date of Termination; or

 

(c)           The Date
of Termination which occurs due to the Participant’s death or Disability.

 

6.             Forfeiture
of Shares.  If the Date of
Termination (as defined below) occurs during the Restricted Period, the Participant
will forfeit any and all rights with respect to such unvested Covered Shares
and the Company shall have the right to cancel any such certificates evidencing
such Covered Shares.

 

7.             Restriction
on Sale.  All Covered Shares shall be
subject to the following restrictions on sale beginning on the Grant Date and
continuing for all periods during the Forfeiture Period (the “Restricted Period”):

 

(a)           The
shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise
disposed of.

 

(b)           Any
additional common shares of the Company issued with respect to the Covered
Shares as a result of any stock dividend, stock split or reorganization, shall
be subject to the restrictions and other provisions of this Agreement.

 

(c)           The Participant
shall not be entitled to receive any shares prior to completion of all actions
deemed appropriate by the Company to comply with federal or state securities
laws and stock exchange requirements.

 

8.             Definitions.  For purposes of this Agreement, the terms
used in this Agreement shall be subject to the following:

 

(a)           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,
regardless of the reason for the termination of employment.

 

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(b)           Disability.  The term “Disability” shall mean 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.

 

9.                Heirs
and 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.  If any rights of
the Participant or benefits distributable to the Participant under this
Agreement have not been exercised or distributed, respectively, at the time of
the Participant’s death, such rights shall be exercisable by the Designated
Beneficiary, and such benefits shall be distributed to the Designated
Beneficiary, in accordance with the provisions of this Agreement and the
Plan.  The “Designated Beneficiary” shall
be the beneficiary or beneficiaries designated by the Participant in a writing
filed with the Committee in such form and at such time as the Committee shall
require.  If a deceased Participant fails
to designate a beneficiary, or if the Designated Beneficiary does not survive
the Participant, any rights that would have been exercisable by the Participant
and any benefits distributable to the Participant shall be exercised by or
distributed to the legal representative of the estate of the Participant.  If a deceased Participant designates a
beneficiary and the Designated Beneficiary survives the Participant but dies
before the Designated Beneficiary’s exercise of all rights under this Agreement
or before the complete distribution of benefits to the Designated Beneficiary
under this Agreement, then any rights that would have been exercisable by the
Designated Beneficiary shall be exercised by the legal representative of the
estate of the Designated Beneficiary, and any benefits distributable to the
Designated Beneficiary shall be distributed to the legal representative of the
estate of the Designated Beneficiary.

 

10.           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.

 

11.           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.

 

12.           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.

 

* * * * * * *

 

3

 

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

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Sumant Ramachandra

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Hospira, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Its:

  	
  Chairman & Chief Executive Officer

  

 

4Exhibit 10.8

 

HOSPIRA SUPPLEMENTAL PENSION PLAN

 

(Effective
as of May 1, 2004 and as amended through the Second Amendment

effective January 1,
2008)

 

 

HOSPIRA SUPPLEMENTAL PENSION
PLAN

 

Section 1

INTRODUCTION

 

1-1.          Pursuant
to a Separation and Distribution Agreement by and between Abbott Laboratories (“Abbott”)
and Hospira, Inc.  (“Hospira”) dated
as of April 12 2004, Abbott distributed as a dividend to its shareholders
all of the outstanding shares of common stock, par value $0.01 per share, of
Hospira, together with the associated preferred stock purchase rights, owned by
Abbott (the “Distribution”).  In
connection with the Distribution, Hospira established the Abbott/Hospira Transitional Annuity Retirement Plan
(the “Annuity Plan”) and certain assets and liabilities were transferred from
the Abbott Laboratories Annuity Retirement Plan (the “Abbott ARP”) to the
Annuity Plan with respect to persons who were transferred from employment with
Abbott to employment with Hospira in connection or contemporaneously with the
Distribution (“Transferred Employees”). 
In connection with the Distribution, Hospira also assumed certain
liabilities with respect to Transferred Employees under the Abbott Laboratories
Supplemental Pension Plan (the “Abbott SERP”). 
Hospira now desires to establish this HOSPIRA SUPPLEMENTAL PENSION PLAN
(the “Supplemental Plan”) to provide (i) the benefits associated with the
obligations assumed by Hospira with respect to Transferred Employees under the
Abbott SERP, (ii) pension benefits calculated under the Annuity
Plan in excess of those which may be paid under that plan under the limits
imposed by Section 415 of the U.S. 
Internal Revenue Code of 1986, as amended (the “Code”), and the Employee
Retirement Income Security Act, as amended (“ERISA”), and (iii) the
additional pension benefits that would be payable under the Annuity Plan if
deferred awards under the Performance Incentive Plan and, with respect to any
Transferred Employee, under the Management Incentive Plan prior to the
Effective Date (as defined below) were included in “final earnings” as defined 

 

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in the Annuity
Plan.  This Supplemental Plan is
established effective as of May 1, 2004 (the “Effective Date”).

 

1-2.          The
Supplemental Plan shall apply to employees of Hospira and its subsidiaries and
affiliates existing as of the Effective Date or thereafter created or
acquired.  (Hospira and each of such
subsidiaries and affiliates are hereinafter referred to as an “employer” and
collectively as the “employers”).

 

1-3.          All
benefits provided under the Supplemental Plan shall be provided from the
general assets of the employers and not from any trust fund or other designated
asset.  All participants in the
Supplemental Plan shall be general creditors of the employers with no priority
over other creditors.

 

1-4.          The
Supplemental Plan shall be administered by the Hospira, Inc. Employee
Benefit Board of Review  appointed
by the Board of Directors of Hospira (the “Board of Directors”) and acting
under the Charter of the Hospira, Inc. Employee Benefit Board of Review (“Board
of Review”).  Except as stated below, the
Board of Review shall perform all powers and duties with respect to the
Supplemental Plan, including the power to direct payment of benefits, allocate
costs among employers, adopt amendments and determine questions of
interpretation.  The Board of Directors
shall have the sole authority to terminate the Supplemental Plan.

 

1-5.  Effective December 31, 2004, the Annuity
Plan is being amended to provide that no benefits shall accrue under the
Annuity Plan after such date. 
Notwithstanding any provision of the Supplemental Plan to the contrary,
no Annuity Plan participant shall accrue a Supplemental Plan benefit after December 31,
2004, and each Annuity Plan participant shall have his benefit under the
Supplemental Plan determined as of a date that is no later than December 31,
2004.

 

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Section 2

ERISA ANNUITY PLAN SUPPLEMENTAL BENEFIT

 

2-1.          The
benefits described in this Section 2 shall apply to all participants in
the Annuity Plan who retire, or terminate with a vested pension under that
plan, on or after the Effective Date.

 

2-2.          Each
Annuity Plan participant whose retirement or vested pension under that plan
would otherwise be limited by Section 415 of the Internal Revenue Code
shall receive a supplemental pension under this Supplemental Plan in an amount,
which, when added to his or her Annuity Plan pension, will equal the amount the
participant would be entitled to under the Annuity Plan as in effect from time
to time, based on the particular option selected by the participant, without
regard to the limitations imposed by Section 415 of the Internal Revenue
Code.

 

Section 3

1986 TAX REFORM ACT SUPPLEMENTAL BENEFIT

 

3-1.          The
benefits described in this Section 3 shall apply to all participants in
the Annuity Plan who retire, or terminate with a vested pension under that plan
after the Effective Date.

 

3-2.          Each
Annuity Plan participant shall receive a supplemental pension under this
Supplemental Plan in an amount equal to the difference, if any, between:

 

(a)           the monthly benefit
payable under the Annuity Plan plus any supplement provided by Section 2;
and

 

(b)           the monthly benefit
which would have been payable under the Annuity Plan (without regard to the
limits imposed by Section 415 of the Internal Revenue Code) if the
participant’s “final earnings”, as defined in the Annuity Plan, had included
compensation in excess of the limits imposed by Section 401(a)(17)of the
Internal Revenue Code, and any “pre-tax contributions” made by the participant
under the Hospira Supplemental 401(k) Plan.

 

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For purposes of calculating the benefit under
this Section 3-2 with respect to any Transferred Employee, any pre-tax
contributions made by the participant under the Abbott Laboratories
Supplemental 401(k) Plan prior to the Effective Date shall be treated as
though made under the Hospira Supplemental 401(k) Plan.

 

Section 4

DEFERRED COMPENSATION PLAN ANNUITY PLAN SUPPLEMENTAL BENEFIT

 

4-1.          The
benefits described in this Section 4 shall apply to all participants in
the Annuity Plan who retire, or terminate with a vested pension, under that
plan, on or after the Effective Date and who made a Deferral Election under the
Abbott Laboratories Deferred Compensation Plan (the “Deferred Compensation Plan”)
with respect to any calendar month during the one hundred twenty consecutive
calendar months immediately preceding retirement or termination of employment.  For
purposes of calculating the benefit under this Section 4 with respect to
any Transferred Employee, amounts deferred under the Abbott Laboratories
Deferred Compensation Plan prior to the Effective Date shall be treated as
deferred under the Deferred Compensation Plan.

 

4-2.          Each
Annuity Plan participant shall receive a supplemental pension under this
Supplemental Plan in an amount equal to the difference, if any, between:

 

(a)           the monthly benefit
payable under the Annuity Plan plus any supplement provided by Section 2
and Section 3; and

 

(b)           the monthly benefit
which would have been payable under the Annuity Plan (without regard to the
limits imposed by Section 415 of the Internal Revenue Code) if the
participant’s “base earnings”, as defined in the Annuity Plan, included
deferrals made under the Deferred Compensation Plan and any compensation in
excess of the limits imposed by Section 401(a)(17)of the Internal Revenue
Code

 

5

 

Section 5

DEFERRED MIP ANNUITY PLAN SUPPLEMENTAL BENEFIT

 

5-1.          The
benefits described in this Section 5 shall apply to all participants in
the Annuity Plan who retire, or terminate with a vested pension, under that
plan, on or after the Effective Date and who were awarded Performance Incentive
Plan awards for any calendar year during the ten consecutive calendar years
ending with the year of retirement or termination of employment.   For purposes of calculating the benefits under
this Section 5 with respect to any Transferred Employee, awards and
payments made prior to the Effective Date under the Management Incentive Plan,
Awards for Performance Excellence Plan or any Division Incentive Plan
maintained by Abbott shall be treated as awards and payments, as applicable,
under the Performance Incentive Plan, Awards for Performance Excellence or a
Division Incentive Plan maintained by Hospira after the Effective Date.

 

5-2.          Each
Annuity Plan participant shall receive a supplemental pension under this Supplemental
Plan in an amount determined as follows:

 

(a)           The
supplemental pension shall be the difference, if any, between:

 

(i)            the monthly benefit
payable under the Annuity Plan plus any supplement provided by Section 2, Section 3,
and Section 4; and

 

(ii)           the monthly benefit
which would have been payable under the Annuity Plan (without regard to the
limits imposed by Section 415 of the Internal Revenue Code) if the
participant’s “final earnings”, as defined in the Annuity Plan, were
one-sixtieth of the sum of:

 

(A)          the participant’s total “basic
earnings” (excluding any payments under the Performance Incentive Plan, Awards
for Performance Excellence Plan or any Division Incentive Plan) received in the
sixty consecutive calendar months for which his basic earnings (excluding any
payments under the Performance Incentive Plan, Awards for Performance
Excellence Plan or any Division Incentive Plan) were highest within the last
one hundred twenty consecutive calendar months immediately preceding his
retirement or termination of employment; and

 

6

 

(B)           the amount of the
participant’s total awards under the Performance Incentive Plan, Awards for
Performance Excellence Plan and any Division Incentive Plan (whether paid immediately
or deferred) made for the five consecutive calendar years during the ten
consecutive calendar years ending with the year of retirement or termination
for which such amount is the greatest and (for participants granted Performance
Incentive Plan awards for less than five consecutive calendar years during such
ten year period) which include all Performance Incentive Plan awards granted
for consecutive calendar years within such ten year period.

 

(b)           That portion of any
Performance Incentive Plan award which the Compensation Committee has
determined shall be excluded from the participant’s “basic earnings” shall be
excluded from the calculation of “final earnings” for purposes of this Section 5-2
and that portion of any award under the Management Incentive Plan which, prior
to the Effective Date, the Compensation Committee of Abbott had determined
would be excluded from a Transferred Employee’s “basic earnings” shall be
excluded from the calculation of “final earnings” for purposes of this Section 5-2.  “Final earnings” for purposes of this
subsection 5-2 shall include any compensation in excess of the limits imposed
by Section 401(a)(17)of the Internal Revenue Code.

 

(c)           In the
event the period described in subsection 5-2(a)(ii)(B) is the final five calendar
years of employment and a Performance Incentive Plan award is made to the
participant subsequent to retirement for the participant’s final calendar year
of employment, the supplemental pension shall be adjusted by adding such new
award and subtracting a portion of the earliest Performance Incentive Plan
award included in the calculation, from the amount determined under subsection
5-2(a)(ii)(B).  The portion subtracted
shall be equal to that portion of the participant’s final calendar year of
employment during which the participant was employed by Hospira; provided,
however, that in the case of any Transferred Employee whose termination occurs
in 2004, the portion of the participant’s final calendar year of employment for
this purpose shall include any portion of 2004 that the participant was
employed by Abbott.  If such adjustment
results in a greater supplemental pension, the greater pension shall be paid
beginning the first month following the date of such new award.

 

Section 6

CORPORATE OFFICER ANNUITY PLAN SUPPLEMENTAL BENEFIT

 

6-1.          The
benefits described in this Section 6 shall apply to all participants in
the Annuity Plan who are corporate officers of Hospira as of the Effective Date
or who become corporate officers thereafter, and who retire, or terminate with
a vested pension under that plan on or after the Effective Date.  The term “corporate officer” for purposes of
this Supplemental 

 

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Plan shall mean an
individual elected an officer of Hospira by its Board of Directors (or
designated as such for purposes of this Section 6 by the Compensation
Committee of the Board of Directors of Hospira), but shall not include
assistant officers.  Notwithstanding the
foregoing or any other provision of this Supplemental Plan to the contrary, in
the case of any Transferred Employee who was a corporate officer of Abbott
immediately prior to the Effective Date and who is not a corporate officer of
Hospira on or after the Effective Date, benefits shall be provided under this Section 6.

 

6-2.          Subject
to the limitations and adjustments described below, each participant described
in subsection 6-1 shall receive a monthly supplemental pension under this
Supplemental Plan commencing on the participant’s normal retirement date under
the Annuity Plan and payable as a life annuity, equal to 6/10 of 1 percent
(.006) of the participant’s final earnings (as determined under subsection 5-2)
for each of the first twenty years of the participant’s benefit service (as
defined in the Annuity Plan) occurring after the participant’s attainment of
age 35.

 

6-3.          In
no event shall the sum of (a) the participant’s aggregate percentage of
final earnings calculated under subsection 6-2 and (b) of the participant’s
aggregate percentage of final earnings calculated under subsections 5.1(a)(ii)(A) and
5-1(b)(i)of the Annuity Plan, exceed the maximum aggregate percentage of final
earnings allowed under subsection 5-1  of
the Annuity Plan (without regard to any limits imposed by the Internal Revenue
Code), as in effect on the date of the participant’s retirement or
termination.  In the event the limitation
described in this subsection 6-3 would be exceeded for any participant, the
participant’s aggregate percentage calculated under subsection 6-2 shall be
reduced until the limit is not exceeded.

 

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6-4.          Subject
to the provisions of subsection 6.1 with respect to any Transferred Employee
who is not a corporate officer of Hospira on or after the Effective Date,
benefit service occurring during any period that a participant is not a
corporate officer of Hospira or was not a corporate officer of Abbott Laboratories prior to the
Effective Date  shall be
disregarded in calculating the participant’s aggregate percentage under
subsection 6-2.

 

6-5.          Any
supplemental pension otherwise due a participant under this Section 6
shall be reduced by the amount (if any) by which:

 

(a)           the sum
of (i) the benefits due such participant under the Annuity Plan and this
Supplemental Plan, plus (ii) the actuarially equivalent value of the
employer-paid portion of all benefits due such participant under the primary
retirement plans of all non-Hospira employers of such participant; exceeds

 

(b)           the
maximum benefit that would be due under the Annuity Plan (without regard to the
limits imposed by Section 415 of the Internal Revenue Code) based on the
participant’s final earnings (as determined under subsection 5-2), if the
participant had accrued the maximum benefit service recognized by the Annuity
Plan.

 

The term “primary
retirement plan” shall mean any pension benefit plan as defined in ERISA,
whether or not qualified under the Internal Revenue Code, which is determined
by the Board of Review to be the primary pension plan of its sponsoring
employer.  The term “non-Hospira employer”
shall mean any employer other than Hospira or a subsidiary or affiliate of
Hospira.  A retirement plan maintained by
an employer prior to such employer’s acquisition by Hospira shall be deemed a
retirement plan maintained by a non-Hospira employer for purposes of this
subsection 6-5.

 

6-6.          Any
supplemental pension due a participant under this Section 6 shall be
actuarially adjusted as provided in the Annuity Plan to reflect the pension
form selected by the participant and the participant’s age at commencement of
the pension, and shall be paid as provided in subsection 7-2.

 

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Section 7

CORPORATE OFFICER ANNUITY PLAN

SUPPLEMENTAL EARLY RETIREMENT BENEFIT

 

7-1.                             The
benefits described in this Section 7 shall apply to all persons described
in subsection 6-1.

 

7-2.                             The
supplemental pension due under Sections 2, 3, 4, 5 and 6 to each participant
described in subsection 7-1 shall be reduced as provided in subsections 5-3 and
5-6 of the Annuity Plan for each month by which its commencement date precedes
the last day of the month in which the participant will attain age 60.  No reduction will be made for the period
between the last day of the months the participant will attain age 60 and age
62.

 

7-3.                             Each
participant described in subsection 7-1 shall receive a monthly supplemental
pension under this Supplemental Plan equal to any reduction made in such
participant’s Annuity Plan pension under subsections 5-3 or 5-6 of the Annuity
Plan for the period between the last day of the months the participant will
attain age 60 and age 62.

 

Section 8

MISCELLANEOUS

 

8-1.                             For
purposes of this Supplemental Plan, the term “Performance Incentive Plan” shall
mean the Hospira 2004 Performance Incentive Plan and any successor plans to
such plan, and the term “Management Incentive Plan” shall mean  the Abbott Laboratories Management
Incentive Plan and any successor plans to such plan.

 

8-2.

 

(a)                                  For
supplemental pension payments that commence on or before December 31,
2008, the supplemental pension described in Sections 2, 3, 4, 5, 6 and 7 shall
be paid to the participant or his or her beneficiary based on the particular
pension option elected by the participant under the Annuity Plan, and in the
same manner, at the same time, for the same period and on the same terms and
conditions as the pension payable to the participant or his beneficiary under
the Annuity Plan.  In the event a
participant is paid his or her pension under the Annuity Plan in a lump 

 

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sum, any
supplemental pension due under Sections 2, 3, 4, 5, 6 or 7 shall likewise be
paid in a lump sum.

 

(b)                                 For
supplemental pension payments that commence on or after January 1, 2009,
the supplemental pensions described in Sections 2, 3, 4, 5, 6 and 7 shall be
paid in the form of a life annuity, provided that a participant may at any time
elect one of the actuarially-equivalent forms of payment described in
Supplement A attached hereto. Elections shall be made using the forms provided
by the Board of Review and shall be irrevocable and remain in effect unless and
until the participant files a new election. A participant’s annuity
commencement date shall occur within 90 days following his or her retirement
date.

 

(c)                                  Notwithstanding
the foregoing, no payments shall be made to a participant who is a key employee
(as determined by Hospira pursuant to Code Section 416(i)) of Hospira
until on or after the first day of the seventh calendar month following the
participant’s separation from service, at which time all payments delayed
during the preceding six (6) month period shall be paid to the participant
in a lump sum within thirty (30) days.

 

(d)                                 Notwithstanding
the foregoing, if the present value of the monthly vested supplemental
pensions, expressed as a life annuity, due a participant or beneficiary under
Sections 2, 3, 4, 5, 6 and 7 do not in the aggregate exceed the elective
deferral limit for qualified retirement plans under Code Section 402(g)(1)(B) as
of the commencement date of the supplemental pension payable to such
participant or beneficiary, then such present value shall be paid to the
participant or beneficiary in a lump-sum within thirty (30) days following the
commencement date.

 

8-3.                             Notwithstanding
any other provisions of this Supplemental Plan, if employment of any
participant with Hospira and its subsidiaries and affiliates should terminate
for any reason within five (5) years after the date of a Change in
Control:

 

(a)                                  The
present value of any supplemental pension due the participant under Section 2
(whether or not then payable) shall be paid to the participant in a lump sum
within thirty (30) days following such termination; and

 

(b)                                 The
present value of any supplemental pension due the participant under Sections 3,
4 or 5 (whether or not then payable) shall be paid to the participant in a lump
sum within thirty (30) days following such termination.

 

The
supplemental pension described in paragraph (a) shall be computed using as
the applicable limit under Section 415 of the Internal Revenue Code, such
limit as is in effect on the termination date and based on the assumption that
the participant will receive his or her Annuity 

 

11

 

Plan
pension in the form of a straight life annuity with no ancillary benefits.  The present values of the supplemental
pensions described in paragraphs (a) and (b) shall be computed as of
the date of payment by using an interest rate equal to the applicable interest
rate as defined in section 417(e) of the Code and as determined for
purposes of the Annuity Plan as of the date of payment.

 

8-4.                             For
purposes of subsection 8-3, a “Change in Control” shall be deemed to have
occurred on the earliest of a Change in Ownership, a Change in Effective
Control, or a Change in Ownership of Assets, each as defined below.

 

(a)                                  Change
in Ownership

 

(i)                                     In
general. Except as provided in paragraph (b)(ii) of this Section, a Change
in Ownership of Hospira occurs on the date that any one person, or more than
one person acting as a group (as defined in paragraph (a)(ii) of this
Section), acquires ownership of Hospira’s stock that, together with stock held
by such person or group, constitutes more than 50% of the total fair market
value or total voting power of the stock. However, if any one person, or more
than one person acting as a group, is considered to own more than 50% of the
total fair market value or total voting power of Hospira’s stock, the
acquisition of additional stock by the same person or persons is not considered
to cause a Change in Ownership of Hospira (or to cause a Change in Effective
Control of Hospira (within the meaning of paragraph (b) of this Section)).
An increase in the percentage of stock owned by any one person, or persons
acting as a group, as a result of a transaction in which Hospira acquires its
stock in exchange for property will be treated as an acquisition of stock for
purposes of this Section. This paragraph (a)(i) applies only when there is
a transfer of Hospira’s stock (or issuance of such stock) and the stock remains
outstanding after the transaction.

 

(ii)                                  Persons
acting as a group. For purposes of paragraph (a)(i) above, persons will
not be considered to be acting as a group solely because they purchase or own
Hospira stock at the same time. However, persons will be considered to be
acting as a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business
transaction with Hospira. If a person, including an entity, owns stock in both
corporations that enter into a merger, consolidation, purchase or acquisition
of stock, or similar transaction, such shareholder is considered to be acting
as a group with other shareholders only with respect to the ownership in that
corporation before the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.

 

12

 

(b)                                 Change
in Effective Control

 

(i)            In
general. Notwithstanding that Hospira has not undergone a Change in Ownership
under paragraph (a) of this Section, a Change in Effective Control of
Hospira occurs only on either of the following dates:

 

(1)           The
date any one person, or more than one person acting as a group (as determined
under paragraph (a)(ii) of this Section), acquires (or has acquired during
the 12-month period ending on the date of the most recent acquisition by such
person or persons) ownership of Hospira stock possessing 30% or more of the
total voting power of the stock.

 

(2)           The
date a majority of members of the Board of Directors is replaced during any
12-month period by Directors whose appointment or election is not endorsed by a
majority of the members of the Board of Directors before the date of the
appointment or election.

 

(ii)              Acquisition
of additional control. If any one person, or more than one person acting as a
group, is considered to effectively control Hospira (within the meaning of this
paragraph (b)), the acquisition of additional control of Hospira by the same
person or persons is not considered to cause a Change in Effective Control of
Hospira (or to cause a Change in Ownership within the meaning of paragraph (a) of
this Section).

 

(c)                                  Change
in Ownership of Assets

 

(i)               In
general. A Change in Ownership of Assets occurs on the date that any one
person, or more than one person acting as a group (as determined in paragraph
(a)(ii) of this Section), acquires (or has acquired during the 12-month
period ending on the date of the most recent acquisition by such person or
persons) assets from Hospira that have a total gross fair market value equal to
or more than 40% of the total gross fair market value of all of Hospira’s
assets immediately before such acquisition or acquisitions. For this purpose,
gross fair market value means the value of the assets of Hospira, or the value
of the assets being disposed of, determined without regard to any liabilities
associated with such assets.

 

(ii)              Transfers
to a related person—There is no Change in Control event under this paragraph (c) when
there is a transfer to an entity that is controlled by the shareholders of the
transferring corporation immediately after the transfer, as provided in this
paragraph (c)(ii). A transfer of assets by Hospira is not treated as a Change
in Ownership of Assets if the assets are transferred to—

 

(1)                                  A
shareholder of Hospira (immediately before the asset transfer) in exchange for
or with respect to its stock;

 

13

 

(2)                                  An
entity, 50% or more of the total value or voting power of which is owned,
directly or indirectly, by Hospira;

 

(3)                                  A
person, or more than one person acting as a group, that owns, directly or
indirectly, 50% or more of the total value or voting power of all the
outstanding stock of Hospira; or

 

(4)                                  An
entity, at least 50% of the total value or voting power of which is owned,
directly or indirectly, by a person described in paragraph (c)(ii)(3) above.

 

For purposes of this paragraph
(c)(ii) and except as otherwise provided above, a person’s status is
determined immediately after the transfer of the assets.

 

(iii)          Persons
acting as a group. Persons will not be considered to be acting as a group
solely because they purchase assets of Hospira at the same time. However,
persons will be considered to be acting as a group if they are owners of a
corporation that enters into a merger, consolidation, purchase or acquisition
of assets, or similar business transaction with Hospira. If a person, including
an entity shareholder, owns stock in both corporations that enter into a
merger, consolidation, purchase or acquisition of assets, or similar
transaction, such shareholder is considered to be acting as a group with other
shareholders in a corporation only to the extent of the ownership in that
corporation before the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.

 

8-5.                             POTENTIAL
CHANGE IN CONTROL.  A “Potential Change
in Control” shall exist during any period in which the circumstances described
in paragraphs (a), (b), (c) or (d), below, exist (provided, however, that
a Potential Change in Control shall cease to exist not later than the
occurrence of a Change in Control):

 

(a)                                  Hospira
enters into an agreement, the consummation of which would result in the
occurrence of a Change in Control, provided that a Potential Change in Control
described in this paragraph (a) shall cease to exist upon the expiration
or other termination of all such agreements.

 

(b)                                 Any
Person (without regard to the exclusions set forth in subsections (i) through
(iv) of such definition) publicly announces an intention to take or to
consider taking actions the consummation of which would constitute a Change in
Control; provided that a Potential Change in Control described in this
paragraph (b) shall cease to exist upon the withdrawal of such intention,
or upon a determination by 

 

14

 

the Board of
Directors that there is no reasonable chance that such actions would be
consummated.

 

(c)                                  Any
Person becomes the Beneficial Owner, directly or indirectly, of securities of
Hospira representing 10% or more of either the then outstanding shares of
common stock of Hospira or the combined voting power of Hospira’s then
outstanding securities (not including in the securities beneficially owned by
such Person any securities acquired directly from Hospira or its Affiliates).

 

(d)                                 The
Board of Directors adopts a resolution to the effect that, for purposes of this
Agreement, a Potential Change in Control exists; provided that a Potential
Change in Control described in this paragraph (d) shall cease to exist
upon a determination by the Board of Directors that the reasons that gave rise
to the resolution providing for the existence of a Potential Change in Control
have expired or no longer exist.

 

In no event shall the Distribution be
considered a Potential Change in Control for purposes of this Supplemental
Plan.

 

8-6.                             The
Board of Directors may, at any time, amend or terminate the Supplemental Plan,
provided that no amendment or termination may, in the absence of written
consent to the change by an affected participant, adversely affect the rights
of the participant under the Supplemental Plan prior to the date such amendment
is adopted. In the event of termination of the Supplemental Plan, Hospira shall
distribute all supplemental pensions in the form of an actuarially equivalent
lump-sum provided (i) Hospira terminates all non-qualified deferred
compensation arrangements of the same type as the Supplemental Plan at the same
time; (ii) except for payments that would be payable if the termination
had not occurred, Hospira makes no distributions to participants for 12 months
but makes all distributions within 24 months; (iii) Hospira adopts no new
non-qualified deferred compensation arrangement of the same type as the
Supplemental Plan for three years; and (iv) the Supplemental Plan’s
termination does not occur proximate to a downturn in Hospira’s financial
health.  The provisions of subsections
8-3, 8-4, 8-5 and this subsection 8-6 may not be amended or deleted, nor
superseded by any other provision of this Supplemental Plan, (i) during
the pendency of a Potential Change in Control and (ii) 

 

15

 

during the period
beginning on the date of a Change in Control and ending on the date five (5) years
following such Change in Control.

 

8-7.                             All
benefits due under this Supplemental Plan shall be paid by Hospira and Hospira
shall be reimbursed for such payments by the participant’s employer.  In the event the participant is employed by
more than one employer, each employer shall reimburse Hospira in proportion to
the period of time the participant was employed by such employer, as determined
by the Board of Review in its sole discretion.

 

8-8.                             The
benefits under the Supplemental Plan are not in any way subject to the debts or
other obligations of the persons entitled to benefits and may not be
voluntarily or involuntarily sold, transferred or assigned.

 

8-9.                             Nothing
contained in this Supplemental Plan shall confer on any employee the right to
be retained in the employ of Hospira or any of its subsidiaries or affiliates.

 

8-10.                       If a
participant in the Supplemental Plan feels he or she should be eligible for a
supplemental pension under the Supplemental Plan, the participant may file a
written claim with the Board of Review. If a written claim for supplemental
pension under the Supplemental Plan by a participant or his or her beneficiary
is denied, either in whole or in part, the claimant will be informed in writing
within 90 days.  If the claimant
does not hear within 90 days, the claimant may treat the claim as if it
had been denied.  A notice of a denial of
a claim will refer to a specific reason or reasons for the denial of the claim;
will have specific references to the Supplemental Plan provisions upon which
the denial is based; will describe any additional material or information
necessary for the claimant to perfect the claim and explain why such material
information is necessary; and will have an explanation of the Supplemental Plan’s
review procedure.  The claimant will have 60 days after the
date of the denial to request in 

 

16

 

writing for a review.  The
claimant must file a written request with the Board of Review for a
review.  During this time the claimant
may review pertinent documents and may submit issues and comments in
writing.  The Board of Review will have
another 60 days in which to consider the claimant’s written request for
review.  If special circumstances require
an extension of time for processing, the Board of Review may have an additional
60 days to answer the claimant.  The
claimant will receive a written notice if the extra days are needed.  The claimant may submit in writing any
document, issues and comments he or she may wish.  The decision of the Board of Review will tell
the claimant the specific reasons for his or her actions, and refer the
claimant to the specific Supplemental Plan provisions upon which its decision
is based.

 

17

 

Hospira Supplemental Pension Plan

 

Supplement A

 

Forms of Payment

 

Payment of
monthly supplemental pension benefits shall be made in one of the following
actuarially-equivalent forms as elected by the participant or beneficiary prior
to the payment commencement date:

 

Life Annuity:
A monthly plan benefit payment payable on a life annuity basis, with the last
payment to be made for the month in which the participant’s death occurs.

 

100% Joint and
Survivor Annuity:  A
plan benefit payable during the participant’s lifetime, and if the participant’s
spouse is living at the date of the participant’s death, payment of the same
amount to such spouse until the spouse’s death occurs.

 

66-2/3% Joint and
Survivor Annuity:  A
plan benefit payable during the participant’s lifetime, and if the participant’s
spouse is living at the date of the participant’s death, payment of two thirds
of such amount to such spouse until the spouse’s death occurs.

 

50% Joint and
Survivor Annuity:  A
50% joint and survivor annuity which is actuarially equivalent to the amount of
monthly income otherwise payable to the participant on a life annuity
basis.  Such joint and survivor annuity
shall consist of a reduced monthly payment continuing during the participant’s
lifetime, and if the participant’s spouse is living at the date of the
participant’s death, payment of one-half of such reduced monthly payment to
such spouse until the spouse’s death occurs, with the last payment to be made
for the month of the death of the last to die of the participant and his
spouse.

 

18

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