Summary of 2007 Terms of Employment for Named Executive Officers of Hospira, Inc.
This document outlines the 2007 employment terms for Hospira, Inc.'s named executive officers, including their annual salaries effective March 26, 2007. It details participation in the company's 2004 Performance Incentive Plan, which ties annual cash incentives to company earnings, with the compensation committee having discretion to adjust awards. Officers are also eligible for equity awards under the 2004 Long-Term Stock Incentive Plan. Additionally, each officer has a change-in-control agreement in place, as described in related company filings.
Summary of 2007 Terms of Employment for Named Executive Officers
Salary
| Officer |
| Salary |
| |
| Christopher B. Begley, Chief Executive Officer |
| $ | 960,000 |
|
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|
|
|
| |
| Terrence C. Kearney, Chief Operating Officer |
| 575,000 |
| |
|
|
|
|
| |
| Edward A. Ogunro, Senior Vice President, Research and Development and Medical Affairs, and Chief Scientific Officer |
| 425,000 |
| |
|
|
|
|
| |
| Thomas E. Werner, Senior Vice President, Finance and Chief Financial Officer |
| 405,000 |
| |
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|
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|
| |
| Brian J. Smith, Senior Vice President, General Counsel and Secretary |
| 390,000 |
| |
The salary for each officer took effect on March 26, 2007.
Annual Cash Incentive
Each is a participant in the Hospira Inc. 2004 Performance Incentive Plan. The plan provides for a base award equal to 2.0% of Hospira’s earnings before interest, taxes, depreciation and amortization for the chief executive officer, 1.5% for the chief operating officer and 1.0% for the other named executive officers. The compensation committee of Hospira’s board of directors has discretion to reduce, but not increase, the award from the base award. The committee will consider Hospira’s adjusted net income, net sales, cash flows and corporate well-being as factors in exercising such discretion and determining actual awards payable under such plan for 2007 performance.
Equity
Each officer is eligible to receive awards under the Hospira 2004 Long-Term Stock Incentive Plan, which is filed as Exhibit 10.8 to Hospira’s Annual Report on Form 10-K for the year ended December 31, 2006 (the “2006 Form 10-K”). Awards are made in the discretion of the compensation committee of Hospira’s board of directors.
Change in Control
Each officer is party to a change-in-control agreement in the forms filed as Exhibit 10.12(a) (for each officer other than Mr. Werner) and Exhibit 10.12(b) to the 2006 Form
10-K. A description of these agreements was included in Hospira’s proxy statement for the 2007 Annual Meeting of Shareholders.
