HSP » Topics » Spin-Off from Abbott

These excerpts taken from the HSP 10-K filed Feb 28, 2008.

Spin-Off from Abbott

        Hospira became an independent public company pursuant to a spin-off from Abbott on April 30, 2004. At that time, Hospira and Abbott entered into various agreements, including agreements that defined the parties' rights and obligations regarding the spin-off, transitional agreements to support Hospira's business and commercial infrastructure, and lease agreements. The parties also agreed that legal title to certain assets and liabilities used in Hospira's international operations would be transferred to Hospira over the two years after the spin-off. During 2006, Hospira and Abbott completed the transitional agreements and all of the transfers of such international assets and liabilities. Some commercial agreements relating to the supply of products among the parties remain in place through 2008, and the lease of the North Chicago, Illinois manufacturing facility remains in force through 2014.

        Except as otherwise agreed by the parties, Hospira assumed all liabilities of Abbott and its subsidiaries to the extent relating to, arising out of or resulting from any matter occurring or existing prior to the spin-off to the extent such liabilities relate to, arise out of or result from Hospira's business and assets. The liabilities that Hospira assumed include, among other things, liabilities for any claims or legal proceedings related to products that had been part of Hospira's business, but were discontinued prior to the spin-off. However, Hospira did not assume certain liabilities of Abbott or its subsidiaries relating to allegations in pending or future investigations and lawsuits that Hospira's business engaged in improper marketing and pricing practices as described in "Item 3. Legal Proceedings—Marketing and Pricing Cases." In addition, Abbott is liable generally for all pre-spin-off U.S. federal income taxes, foreign taxes and certain state taxes attributable to Hospira's business. Hospira generally is liable for all other taxes attributable to its business.

        Hospira generally assumed all employment-related obligations and liabilities for all U.S. employees who transferred employment to Hospira in connection with the spin-off, including salaries and vacation, except as otherwise agreed by the parties. Abbott generally retained responsibility for all employment-related obligations and liabilities for U.S. non-union employees who terminated their employment or retired prior to the spin-off or who otherwise did not transfer employment to Hospira in connection with the spin-off, except as otherwise provided in the agreement. Abbott retained liabilities for post-retirement medical, dental and life insurance benefits for U.S. non-union employees who were retired at the time of the spin-off and for those U.S. non-union employees who were eligible to retire as of the time of the spin-off (commencing on or after their retirement with Hospira), for other medical and dental claims which were incurred by employees of Hospira's business prior to the spin-off, and for certain deferred compensation and supplemental pension obligations, subject in all cases to the terms of the spin-off and the applicable Abbott plans. Hospira assumed and is liable for the pension and other benefits of Hospira's former union employees at its Ashland, Ohio site. Hospira's obligations with respect to employees outside the United States are governed in accordance with the terms of applicable local plans and local law.

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Spin-Off from Abbott



        Hospira became an independent public company pursuant to a spin-off from Abbott on April 30, 2004. At that time, Hospira and Abbott entered
into various agreements, including agreements that defined the parties' rights and obligations regarding the spin-off, transitional agreements to support Hospira's business and commercial
infrastructure, and lease agreements. The parties also agreed that legal title to certain assets and liabilities used in Hospira's international operations would be transferred to Hospira over the two
years after the spin-off. During 2006, Hospira and Abbott completed the transitional agreements and all of the transfers of such international assets and liabilities. Some commercial
agreements relating to the supply of products among the parties remain in place through 2008, and the lease of the North Chicago, Illinois manufacturing facility remains in force through 2014.



        Except
as otherwise agreed by the parties, Hospira assumed all liabilities of Abbott and its subsidiaries to the extent relating to, arising out of or resulting from any matter occurring
or existing prior to the spin-off to the extent such liabilities relate to, arise out of or result from Hospira's business and assets. The liabilities that Hospira assumed include, among
other things, liabilities for any claims or legal proceedings related to products that had been part of Hospira's business, but were discontinued prior to the spin-off. However, Hospira
did not assume certain liabilities of Abbott or its subsidiaries relating to allegations in pending or future investigations and lawsuits that Hospira's business engaged in improper marketing and
pricing practices as described in "Item 3. Legal Proceedings—Marketing and Pricing Cases." In addition, Abbott is liable generally for all pre-spin-off U.S.
federal income taxes, foreign taxes and certain state taxes attributable to Hospira's business. Hospira generally is liable for all other taxes attributable to its business.



        Hospira
generally assumed all employment-related obligations and liabilities for all U.S. employees who transferred employment to Hospira in connection with the spin-off,
including salaries and vacation, except as otherwise agreed by the parties. Abbott generally retained responsibility for all employment-related obligations and liabilities for U.S.
non-union employees who terminated their employment or retired prior to the spin-off or who otherwise did not transfer employment to Hospira in connection with the
spin-off, except as otherwise provided in the agreement. Abbott retained liabilities for post-retirement medical, dental and life insurance benefits for U.S.
non-union employees who were retired at the time of the spin-off and for those U.S. non-union employees who were eligible to retire as of the time of the
spin-off (commencing on or after their retirement with Hospira), for other medical and dental claims which were incurred by employees of Hospira's business prior to the
spin-off, and for certain deferred compensation and supplemental pension obligations, subject in all cases to the terms of the spin-off and the applicable Abbott plans. Hospira
assumed and is liable for the pension and other benefits of Hospira's former union employees at its Ashland, Ohio site. Hospira's obligations with respect to employees outside the United States are
governed in accordance with the terms of applicable local plans and local law.



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This excerpt taken from the HSP 10-K filed Feb 28, 2007.

Spin-Off from Abbott

Hospira became an independent public company pursuant to a spin-off from Abbott Laboratories on April 30, 2004. At that time, Hospira and Abbott entered into various agreements, including agreements that defined the parties’ rights and obligations regarding the spin-off, transitional agreements to support Hospira’s business and commercial infrastructure, and lease agreements. The parties also agreed that legal

12




title to certain assets and liabilities used in Hospira’s international operations would be transferred to Hospira over the two years after the spin-off. During 2006, Hospira and Abbott completed the transitional agreements and all of the transfers of such international assets and liabilities. Some commercial agreements relating to the supply of products among the parties remain in place through 2008, and the lease of the North Chicago, Illinois manufacturing facility remains in force through 2014.

Except as otherwise agreed by the parties, Hospira assumed all liabilities of Abbott and its subsidiaries to the extent relating to, arising out of or resulting from any matter occurring or existing prior to the spin-off to the extent such liabilities relate to, arise out of or result from Hospira’s business and assets. The liabilities that Hospira assumed include, among other things, liabilities for any claims or legal proceedings related to products that had been part of Hospira’s business, but were discontinued prior to the spin-off. However, Hospira did not assume certain liabilities of Abbott or its subsidiaries relating to allegations in pending or future investigations and lawsuits that Hospira’s business engaged in improper marketing and pricing practices as described in “Item 3. Legal Proceedings—Marketing and Pricing Cases.”  In addition, Abbott is liable generally for all pre-spin-off U.S. federal income taxes, foreign taxes and certain state taxes attributable to Hospira’s business. Hospira generally is liable for all other taxes attributable to its business.

Hospira generally assumed all employment-related obligations and liabilities for all U.S. employees who transferred employment to Hospira in connection with the spin-off, including salaries and vacation, except as otherwise agreed by the parties. Abbott generally retained responsibility for all employment-related obligations and liabilities for U.S. non-union employees who terminated their employment or retired prior to the spin-off or who otherwise did not transfer employment to Hospira in connection with the spin-off, except as otherwise provided in the agreement. Abbott retained liabilities for post-retirement medical, dental and life insurance benefits for U.S. non-union employees who were retired at the time of the spin-off and for those U.S. non-union employees who were eligible to retire as of the time of the spin-off (commencing on or after their retirement with Hospira), for other medical and dental claims which were incurred by employees of Hospira’s business prior to the spin-off, and for certain deferred compensation and supplemental pension obligations, subject in all cases to the terms of the spin-off and the applicable Abbott plans. Hospira assumed and is liable for the pension and other benefits of Hospira’s current and former union employees at its Ashland, Ohio site. Hospira’s obligations with respect to employees outside the United States are governed in accordance with the terms of applicable local plans and local law.

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