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WYETH UNION SAVINGS PLAN
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By:
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/s/ Neal Masia
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Neal Masia
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Member of the Savings Plan Committee
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Date: June 27, 2011
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WYETH UNION SAVINGS PLAN
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE
AS OF DECEMBER 31, 2010 AND 2009
AND
FOR THE YEAR ENDED DECEMBER 31, 2010
EMPLOYER IDENTIFICATION NUMBER - 13-5315170
PLAN NUMBER – 017
WYETH UNION SAVINGS PLAN
DECEMBER 31, 2010 AND 2009
INDEX
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Page
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Report of Independent Registered Public Accounting Firm
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Statements of Net Assets Available for Plan Benefits
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as of December 31, 2010 and 2009
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1
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Statement of Changes in Net Assets Available for Plan Benefits
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for the Year Ended December 31, 2010
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2
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Notes to Financial Statements
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3 - 15
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Supplemental Schedule:*
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Schedule H, line 4i - Schedule of Assets (Held At End of Year)
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December 31, 2010
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16 - 17
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Exhibit 23.1 - Consent of Independent Registered Public Accounting Firm
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18
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Other schedules required by Section 2520.103-10 of the Department of Labor’s Rules and Regulations for Reporting and Disclosure under ERISA have been omitted because they are not applicable. |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Savings Plan Committee
Wyeth Union Savings Plan:
We have audited the accompanying statements of net assets available for plan benefits of the Wyeth Union Savings Plan (the “Plan”) as of December 31, 2010 and 2009 and the related statement of changes in net assets available for plan benefits for the year ended December 31, 2010. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the 2010 financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Plan as of December 31, 2010 and 2009, and the changes in net assets available for plan benefits for the year ended December 31, 2010, in conformity with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental Schedule H, Line 4i - Schedule of Assets (Held at End of Year) as of December 31, 2010 is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/ KPMG LLP
Memphis, Tennessee
June 27, 2011
Wyeth Union Savings Plan
Statements of Net Assets Available for Plan Benefits
As of December 31, 2010 and 2009
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December 31,
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2010
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2009
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Assets:
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Investments, at fair value
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$ |
63,469,212 |
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$ |
32,890,691 |
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Investment in Master Trust, at fair value
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- |
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27,070,835 |
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Total investments
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63,469,212 |
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59,961,526 |
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Receivables:
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Employer contributions
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21,302 |
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17,934 |
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Participant contributions
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66,013 |
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68,216 |
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Notes receivable from participants
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1,757,900 |
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1,986,662 |
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Total receivables
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1,845,215 |
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2,072,812 |
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Net assets available for plan benefits, at fair value
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65,314,427 |
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62,034,338 |
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Adjustment from fair value to contract value for fully
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benefit-responsive investment contracts
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(1,045,169 |
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(289,680 |
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Net Assets available for plan benefits
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$ |
64,269,258 |
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$ |
61,744,658 |
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See accompanying notes to financial statements.
Wyeth Union Savings Plan
Statement of Changes in Net Assets Available for Plan Benefits
For the Year Ended December 31, 2010
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Additions to net assets attributed to:
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Investment income:
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Net appreciation in fair value of investments
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$ |
4,346,299 |
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Net investment gain in Master Trust
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551,561 |
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Interest
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124,785 |
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Dividends
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298,926 |
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Total investment income
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5,321,571 |
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Contributions:
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Employer
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1,213,851 |
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Participant
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3,824,113 |
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Rollovers into Plan
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339,894 |
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Total contributions
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5,377,858 |
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Total additions
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10,699,429 |
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Deductions from net assets attributed to:
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Benefits paid to participants
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8,172,158 |
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Administrative expenses
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2,671 |
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Total deductions
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8,174,829 |
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Increase in net assets
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2,524,600 |
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Net assets available for plan benefits
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Beginning of year
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61,744,658 |
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End of year
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$ |
64,269,258 |
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See accompanying notes to financial statements.
WYETH UNION SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2010 AND 2009
NOTE 1 – DESCRIPTION OF PLAN
The following description of the Wyeth Union Savings Plan (“the Plan”) only provides general information. Participants in the Plan should refer to the Plan document for a more detailed and complete description of the Plan’s provisions.
General
On October 15, 2009, Pfizer Inc. (“the Company”) acquired all of the outstanding equity of Wyeth. In connection with the acquisition, the Company adopted and assumed sponsorship of the Plan effective October 15, 2009.
The Plan, a defined contribution profit sharing plan of legacy Wyeth, is a voluntary savings plan available to all eligible employees, as defined. Employees become eligible to participate after they have completed one month of regular employment, as defined by the Plan, and whose employment is covered by a collective bargaining agreement that provides for their participation. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”) and the Internal Revenue Code of 1986 as amended (“the Code”).
Employee Contributions
Participants may elect to make contributions to the Plan in whole percentages up to a maximum of 16% of their covered compensation, as defined. Contributions can be made on a before-tax basis (“salary deferral contributions”), an after-tax basis (“after-tax contributions”), or a combination of both. Participants direct the investment of their contributions into various investment options offered by the Plan. Under the Code, salary deferral contributions, total annual contributions, and the amount of compensation that can be included for Plan purposes are subject to annual limitations; any excess contributions are refunded to participants in the following year, if applicable.
Employer Contributions
In accordance with negotiated union agreements, legacy Wyeth began matching contributions as follows: effective January 1, 2008, for the Rouses Point, New York and Fort Dodge, Iowa unions and effective April 1, 2008 for the Pearl River, New York union. The Company contributes an amount equal to 50% of the first 6% of the participant’s covered compensation. Participants direct the investment of their Company contributions into various investment options offered by the Plan.
Rollovers into Plan
Participants may elect to roll over one or more account balances from qualified plans as well as from the Wyeth Coordinated Bargaining Retirement Plan into the Plan.
Vesting and Separation From Service
Participants are fully vested at all times in their salary deferral contributions, after-tax contributions and rollover contributions and all earnings (losses) thereon. A participant is also fully vested in Company matching contributions if the participant has at least five years of vesting service, as defined. If a participant has less than five years of continuous service, such participant becomes vested in the Company matching contributions and all earnings (losses) thereon according to the following schedule:
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Years of Vesting Service
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Vesting Percentage
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1 year completed
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0%
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2 years completed
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25%
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3 years completed
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50%
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4 years completed
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75%
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5 years completed
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100%
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Regardless of the number of years of vesting service, participants are fully vested in their Company matching contributions account upon reaching age 65 or upon death, if earlier. If an employee’s employment is terminated prior to full vesting, the non-vested portion of the Company matching contributions and all earnings thereon is forfeited and becomes available to satisfy future Company matching contributions.
Forfeited Amounts
During 2010, forfeitures of $19,000 were used to offset legacy Wyeth matching contributions. As of December 31, 2010 and 2009, the amount of forfeitures available to offset future Company matching contributions totaled $6,809 and $10,512, respectively.
Distributions
Participants may withdraw all or any portion of their after-tax contributions. Participants may make full or partial withdrawals of funds in any of their accounts upon attaining age 59 ½ or for financial hardship, as defined before that age. Participants may qualify for financial hardship withdrawals if they have an immediate and heavy financial need, as determined by the plan administrator. Participants are limited to one hardship withdrawal in any calendar year, provided they have no other funds that are readily available to meet that need.
Upon termination of employment, participants are entitled to a distribution of their vested account balance in one of two ways: lump-sum or a 50% joint and survivor annuity (subject to limits imposed by the Internal Revenue Code).
Annuity payments and monthly payments commence as soon as practicable following a request, but in no event later than April 1 in the year following the year in which the participant turns 70 ½ years of age. Participants can elect to defer the distribution of their accounts if the participant’s account balance is greater than $1,000.
Administrative Costs
Costs and expenses of administering the Plan are generally paid by the Company or the Plan. Certain investment expenses are deducted from the applicable investment funds. Participants are charged for loan application and maintenance fees.
Notes Receivable from Participants
Participants who have a vested account balance of at least $2,000 may borrow from the vested portion of their account, subject to certain maximum amounts of up to $50,000. Participants in the Plan may borrow up to fifty percent (50%) of their vested account balances. Each loan is collateralized by the borrower’s vested interest in their account balance. All loans must be repaid within five years except for those used to acquire or construct a principal residence, which must be repaid within fifteen years. Defaults on participants’ loans during the year are treated as distributions and are fully taxable to the participants. The interest rate charged on loans provides a return commensurate with a market rate, or such other rate as permitted by government regulations as of the date of the loan agreement.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying financial statements are prepared on the accrual basis of accounting. Investments in collective trust funds that include fully benefit-responsive investment contracts are presented at fair value in the statements of net assets available for plan benefits, and the amount representing the difference between fair value and contract value of these investments is also presented on the face of the statements of net assets available for plan benefits. The statement of changes in net assets available for benefit plans is prepared on a contract value basis. Contract value is the relevant measurement attribute for that portion of the net assets available for plan benefits of a defined contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan.
Contributions
Contributions from the employer are accrued based upon amounts required to be funded under the provisions of the Plan. Contributions from employees are accrued when deducted from payroll.
Participant Accounts
Each participant account is credited with the participant’s contribution and allocation of investment earnings (losses) and Company contributions, and such accounts are charged with certain investment fees, depending on investment options. Allocations are based on earnings (losses) or account balance, as defined in the Plan document.
Payment of Benefits
Benefits are recorded when paid.
Reclassification
Certain amounts have been reclassified in the prior year in order to conform to current year presentation.
Investment Valuation and Income Recognition
Investments in common stocks are valued on quoted market value as of the last business day of the year. Investments in mutual funds are valued at the closing market price obtained from national exchanges of the underlying investments of the respective fund as of the last business day of the year. Investments in common/collective trust funds are stated at redemption value as determined by the trustees of such funds based upon the underlying securities stated at fair value. The fair value of the guaranteed investment contracts is calculated by discounting the related cash flows based on current yields of similar instruments with comparable durations. The fair value of the synthetic guaranteed investment contracts is determined by the fair value of the underlying assets. Interest bearing cash is valued at cost which approximates fair value.
Net appreciation in the fair value of investments consists of the realized gains or losses and the change in unrealized appreciation on those investments. Purchases and sales are recorded on a trade date basis. Dividends are recorded on the ex-dividend date. Interest income is recorded as earned on the accrual basis.
The following table presents investments:
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December 31,
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2010
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2009
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Investments at fair value as determined by
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reported net asset value or quoted market price
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Mutual funds
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$ |
34,166,394 |
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$ |
31,684,780 |
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Collective trust funds
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- |
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1,496,662 |
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Common stock
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1,407,161 |
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1,149,663 |
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Investments at estimated fair value
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Investment contracts
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- |
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21,248,750 |
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Stable value fund
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27,895,657 |
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- |
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Investments at cost
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Interest bearing cash
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- |
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4,381,671 |
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Total investments, at fair value
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$ |
63,469,212 |
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$ |
59,961,526 |
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Adoption of New Accounting Standard
In January 2010, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2010-06 which amends Accounting Standards Codification (ASC) 820, Fair Value Measurements and Disclosures, adding new disclosure requirements for Levels 1 and 2, separate disclosures of purchases, sales, issuances and settlements relating to Level 3 measurements and clarification of existing fair value disclosures. The Plan prospectively adopted the new guidance in 2010, except for the Level 3 disclosures which are required in 2011. The adoption in 2010 did not materially affect and the future adoption is not expected to materially affect the Plan’s financial statements.
Risks and Uncertainties
The Plan’s assets consist of various investments which are exposed to a number of risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is reasonably possible that changes in risks in the near term would materially affect participants’ account balances and the amounts reported in the statements of net assets available for plan benefits and the statement of changes in net assets available for plan benefits.
Notes Receivable from Participants
In September 2010, the FASB issued guidance clarifying the classification and measurement of participant loans by defined contribution pension plans. That guidance requires that participant loans be classified as notes receivable from participants and measured at their unpaid principal balance, plus any accrued but unpaid interest. The Plan has adopted this new guidance in its December 31, 2010 financial statements and has reported participant loans of $1,757,900 and $1,986,662 at December 31, 2010 and 2009, respectively, as notes receivable from participants. Net assets of the Plan were not affected by the adoption of this new guidance.
Use of Estimates
The preparation of the Plan’s financial statements in conformity with U.S. generally accepted accounting principles requires the plan administrator to make estimates and assumptions that affect the reported amounts in net assets available for plan benefits at the date of the financial statements and the changes in net assets available for plan benefits during the reporting period and, when applicable, disclosures of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates.
NOTE 3 – INVESTMENT IN MASTER TRUST
On August 28, 2008, legacy Wyeth entered into an agreement with Mercer Trust Company (“MTC”) to create a Master Trust for the Interest Income Funds (“Fund(s)”) of the Plan and another Company sponsored savings plan. MTC maintained the assets of the Master Trust. Effective September 30, 2010, the Master Trust was terminated.
Each participating Fund had an undivided interest in the Master Trust. At December 31, 2009, approximately 3.50% of the net assets of the Master Trust was allocated to the Plan’s Fund. Fund asset balances, investment income and administrative expenses relating to the Master Trust were allocated to the individual plans’ Fund based upon average monthly balances invested by each plans’ Fund.
The following table presents the net assets of the Master Trust.
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December 31, 2010
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December 31, 2009
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Investments, at fair value:
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Interest bearing cash
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$ |
- |
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$ |
123,572,982 |
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Synthetic guaranteed investment contracts
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- |
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448,514,239 |
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Guaranteed investment contracts
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- |
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158,541,133 |
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Collective trust
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- |
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42,758,121 |
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Total net assets
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$ |
- |
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$ |
773,386,475 |
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Fund’s interest in net assets of the Master Trust
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$ |
- |
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$ |
27,070,835 |
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Net investment gain for the Master Trust is as follows:
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Year Ended
December 31, 2010
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Net investment gain in Master Trust:
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Interest bearing cash
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$ |
103,360 |
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Synthetic guaranteed investment contracts
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11,123,767 |
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Guaranteed investment contracts
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4,193,123 |
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Collective trust funds
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207,846 |
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Net investment gain
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$ |
15,628,096 |
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Fund’s allocation of net investment gain
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$ |
551,561 |
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NOTE 4 – INVESTMENT CONTRACTS
The Plan’s Fund in the Master Trust primarily invested in two types of investment contracts -guaranteed investment contracts (“GICs”) and synthetic GICs (“Wrappers”), both issued by insurance companies and other financial institutions.
Traditional GICs are backed by the general account of the issuer. The fair value of the guaranteed investment contracts was $5,549,413 at December 31, 2009. The Fund deposits a lump sum with the issuer and receives a guaranteed interest rate for a specified time. Interest is accrued on either a simple interest or compounded basis and paid either periodically or at the end of the contract term. The issuer guarantees that all qualified participant withdrawals will occur at contract value (principal plus accrued interest). The interest crediting rates of traditional GICs remain fixed for the life of the contract.
A synthetic GIC is an investment contract issued by financial institutions backed by units of commingled bond funds that are owned directly by the Fund. These assets underlying the wrap contract are maintained separately from the contract issuer’s general assets by a third party custodian. The fair value of the underlying assets was $15,699,337 at December 31, 2009. The wrapper contracts are obligated to provide an interest rate not less than zero. These contracts typically provide that realized and unrealized gains and losses on the underlying assets are not reflected immediately in the net assets of the Fund, but rather are amortized, over the duration of the underlying investments, through adjustments to the future interest crediting rate. The crediting rates on synthetic GICs typically reset on a quarterly basis. The issuer guarantees that all qualified participant withdrawals will occur at contract value. The fair value of the wrapper contracts was $26,656 at December 31, 2009.
Primary variables impacting future crediting rates of the Wrappers include:
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current yield of the assets within the wrap contract
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duration of the assets covered by the wrap contract
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-
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existing difference between the market value and contract value of the assets within the wrap contract
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Fully benefit-responsive investment contracts, including guaranteed investment contracts and wrap (synthetic) contracts are agreements with banks, insurance companies and other financial institutions that are designed to help preserve principal and provide a stable crediting rate. These contracts are fully benefit-responsive and provide that a benefit plan participant-initiated withdrawals, permitted under a participating plan, will be paid at contract value. In addition to certain wrap agreement termination provisions discussed below, the contracts generally provide for withdrawals associated with certain events that are not in the ordinary course of Fund operations, and that the issuer determines will have a material adverse effect on the issuer’s financial interest, will be paid with a market value adjustment to the contract value amount of such withdrawal as defined in such contracts. While each contract issuer specifies the events that may trigger such a market value adjustment, typically such events include all or a portion of the following: (i) amendments to the Fund documents or Fund’s administration; (ii) changes to the Fund’s prohibition on competing investment options by participating plans or deletion of equity wash provisions; (iii) complete or partial termination of the Fund or its merger with another fund; (iv) the failure of the Fund or its trust to qualify for exemption from federal income taxes or any required prohibited transaction exemption under ERISA; (v) unless made in accordance with the withdrawal provisions of the Fund, the redemption of all or a portion of the interests in the Fund held by a participating plan at the direction of the participating plan sponsor, including withdrawals due to the removal of a specifically identifiable group of employees from coverage under the participating plan (such as a group layoff or early retirement incentive program), or the closing or sale of a subsidiary, employing unit or affiliate, the bankruptcy or insolvency of a plan sponsor, the merger of the plan with another plan, or the plan sponsor’s establishment of another tax qualified defined contribution plan; (vi) any change in law, regulation, ruling, administrative or judicial position or accounting requirement, in any case applicable to the Fund or participating plans; and (vii) the delivery by the plan sponsor of any communication to plan participants designed to influence a participant not to invest in the Fund. At this time, the Fund does not believe that the occurrence of any such market value event which would limit the Fund’s ability to transact at contract value with participants is probable.
Guaranteed investment contracts generally do not permit issuers to terminate the agreement prior to the scheduled maturity date. Wrapper contracts generally are evergreen contracts (no specific maturity date) that contain termination provisions. Wrapper agreements permit the Fund’s investment manager or issuer to terminate upon notice at any time at market value and provide for automatic termination of the wrapper contract if the book value or the market value of the contract equals zero. The issuer is not excused from paying the excess contract value when the market value equals zero. Wrapper contracts that permit the issuer to terminate at market value generally provide that the Fund may elect to convert such termination to an Amortization Election as described below. In addition, if the Fund defaults in its obligations under the agreement (including the issuer’s determination that the agreement constitutes a non-exempt prohibited transaction as defined under ERISA) and such default is not cured within the time permitted by any cure period, then the wrapper contract may be terminated by the issuer and the Fund will receive the market value as of the date of termination. Also, wrapper contracts generally permit the issuer or investment manager to elect at any time to convert the wrapped portfolio to a declining duration strategy whereby the contract would terminate at a date which corresponds to the duration of the underlying fixed income portfolio on the date of the amortization election (“Amortization Election”). After the effective date of an Amortization Election, the fixed income portfolio must conform to the guidelines agreed upon by the wrapper issuer and the investment manager for the Amortization Election period. Such guidelines are intended to result in contract value equaling market value of the wrapped portfolio by such termination date.
NOTE 5 – FAIR VALUE MEASUREMENTS
FASB Accounting Standards Codification (“ASC”) Section 820, Fair Value Measurements and Disclosures (“FASB ASC 820”), establishes a framework for measuring fair value in U.S. generally accepted accounting principles and expands disclosures about fair value measurements. This framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy assigns the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (i.e., Level 1 measurements) and the lowest priority to unobservable inputs (i.e., Level 3 measurements). The three levels of the fair value hierarchy under FASB ASC 820 are described below:
Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access.
Level 2 – Inputs to the valuation methodology include the following:
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Quoted prices for similar assets or liabilities in active markets;
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●
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Quoted prices for identical or similar assets or liabilities in inactive markets;
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●
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Inputs other than quotes prices that are observable for the asset or liability, and/or
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●
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Inputs that are derived principally from, or corroborated by, observable market data by correlation or other means.
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If the asset or liability has a specified or contractual term (e.g., traditional guaranteed investment contract), the Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The fair value measurement level assigned to the asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The valuation techniques used are required to maximize the use of observable inputs and minimize the use of unobservable inputs.
The Plan uses the following valuation methods for determining fair value in accordance with FASB ASC 820.
Common stocks – Valued at the closing price reported on the active market on which the individual securities are traded.
Mutual funds – Valued at the closing market price obtained from national exchanges of the underlying investments of the respective fund as of the last business day of the year.
Traditional guaranteed investment contracts – Valued at fair value by discounting each GIC’s related cash flows based on swap curve rates in effect as of the measurement date, with the maturity of the swap curve rate matched to each underlying GIC cash flow.
Synthetic guaranteed investment contracts – The underlying investments of the Plan’s synthetic GICs are of two types – an institutional mutual fund, and a commingled bond portfolio. The institutional mutual fund is valued at the quoted NAV as of the measurement date, while the underlying fixed income investments of the commingled bond portfolio are valued by the custodian, utilizing prices provided by third party pricing sources that incorporate inputs such as reported trades, broker/dealer quotes, benchmark yields, issuer spreads and bid/offer data.
Money market funds and collective trust funds – Valued at NAV, i.e. the price at which investors may enter and exit the funds on a daily basis, with no restrictions.
The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent with those used by other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
The following tables set forth by level, within the FASB ASC 820 fair value hierarchy, the Plan’s investments at fair value as of December 31, 2010 and 2009.
| |
|
|
|
| |
|
Investments at Fair Value as of December 31, 2010
|
|
| |
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
$ |
1,407,161 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
1,407,161 |
|
|
Mutual funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth & income funds
|
|
|
21,902,381 |
|
|
|
- |
|
|
|
- |
|
|
|
21,902,381 |
|
|
Lifecycle funds
|
|
|
4,594,568 |
|
|
|
- |
|
|
|
- |
|
|
|
4,594,568 |
|
|
Bond funds
|
|
|
4,149,557 |
|
|
|
- |
|
|
|
- |
|
|
|
4,149,557 |
|
|
International funds
|
|
|
2,758,140 |
|
|
|
- |
|
|
|
- |
|
|
|
2,758,140 |
|
|
Growth funds
|
|
|
666,497 |
|
|
|
- |
|
|
|
- |
|
|
|
666,497 |
|
|
Value funds
|
|
|
95,251 |
|
|
|
- |
|
|
|
- |
|
|
|
95,251 |
|
|
Total mutual funds
|
|
|
34,166,394 |
|
|
|
- |
|
|
|
- |
|
|
|
34,166,394 |
|
|
Common/collective trust:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managed income fund
|
|
|
- |
|
|
|
27,895,657 |
|
|
|
- |
|
|
|
27,895,657 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments at fair value
|
|
$ |
35,573,555 |
|
|
$ |
27,895,657 |
|
|
$ |
- |
|
|
$ |
63,469,212 |
|
| |
|
|
|
| |
|
Investments at Fair Value as of December 31, 2009
|
|
| |
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
$ |
1,149,663 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
1,149,663 |
|
|
Mutual funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Growth & income funds
|
|
|
24,857,244 |
|
|
|
- |
|
|
|
- |
|
|
|
24,857,244 |
|
|
Lifecycle funds
|
|
|
3,802,797 |
|
|
|
- |
|
|
|
- |
|
|
|
3,802,797 |
|
|
International funds
|
|
|
2,415,849 |
|
|
|
- |
|
|
|
- |
|
|
|
2,415,849 |
|
|
Growth funds
|
|
|
520,671 |
|
|
|
- |
|
|
|
- |
|
|
|
520,671 |
|
|
Value funds
|
|
|
88,219 |
|
|
|
- |
|
|
|
- |
|
|
|
88,219 |
|
|
Total mutual funds
|
|
|
31,684,780 |
|
|
|
- |
|
|
|
- |
|
|
|
31,684,780 |
|
|
Guaranteed investment contracts
|
|
|
- |
|
|
|
5,549,413 |
|
|
|
- |
|
|
|
5,549,413 |
|
|
Synthetic investment contracts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment contracts
|
|
|
- |
|
|
|
15,672,681 |
|
|
|
- |
|
|
|
15,672,681 |
|
|
Wrapper contracts
|
|
|
- |
|
|
|
26,656 |
|
|
|
- |
|
|
|
26,656 |
|
| |
|
|
- |
|
|
|
15,699,337 |
|
|
|
- |
|
|
|
15,699,337 |
|
|
Collective trust funds:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managed income fund
|
|
|
- |
|
|
|
1,496,662 |
|
|
|
- |
|
|
|
1,496,662 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Money market fund
|
|
|
4,381,671 |
|
|
|
- |
|
|
|
- |
|
|
|
4,381,671 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total investments at fair value
|
|
$ |
37,216,114 |
|
|
$ |
22,745,412 |
|
|
$ |
- |
|
|
$ |
59,961,526 |
|
NOTE 6 – INVESTMENT ELECTIONS
Participants can elect to invest amounts credited to their account in any of seventeen investment funds offered by the Plan and transfer amounts between these funds at any time during the year. Investment elections must be made in multiples of 1%. Transfers between funds must be made in whole percentages and/or in an amount of at least $250 and may be made on a daily basis.
The seventeen investment options are as follows effective October 1, 2010:
|
|
Blackrock Core Bond Fund
|
|
|
Northern Trust Russell 2000 Small Cap Index Fund
|
|
|
Northern Trust S&P 500 Equity Index Fund
|
|
|
Pfizer Inc. Company Stock Fund
|
|
|
T. Rowe Price Stable Value Fund
|
|
|
Fidelity Low Price Stock Fund
|
|
|
Fidelity Large Cap Growth Fund
|
|
|
Fidelity Mid Cap Stock Fund
|
|
|
T. Rowe Price Small Cap Stock Fund
|
|
|
Blackrock Lifepath Retirement Fund
|
|
|
Blackrock Lifepath 2020 Fund
|
|
|
Blackrock Lifepath 2030 Fund
|
| |
Blackrock Lifepath 2040 Fund
|
|
|
Blackrock US TIPS Index Fund
|
|
|
Dodge & Cox International Fund
|
|
|
Eaton Vance Special Large Cap Fund
|
|
|
Oppenheimer Developing Markets Fund
|
The twenty-five investment options were as follows through September 30, 2010:
| |
Interest Income Fund
|
| |
Pfizer Common Stock Fund
|
| |
Fidelity Magellan Fund
|
| |
Fidelity Balanced Fund.
|
| |
Fidelity International Discovery Fund
|
| |
Fidelity Spartan U.S. Equity Index Fund
|
| |
Fidelity Low-Priced Stock Fund
|
| |
Invesco Value II Fund Class A
|
| |
PIMCO Total Return
|
| |
Fidelity High Income Fund
|
| |
Fidelity New Markets Income Fund
|
| |
Oppenheimer Developing Markets Fund Class A
|
| |
Fidelity Real Estate Investment Fund
|
| |
Fidelity Capital Appreciation Fund
|
| |
RS Partners Fund
|
| |
Fidelity Freedom 2005 Fund
|
| |
Fidelity Freedom 2010 Fund
|
| |
Fidelity Freedom 2015 Fund
|
| |
Fidelity Freedom 2020 Fund
|
| |
Fidelity Freedom 2025 Fund
|
| |
Fidelity Freedom 2030 Fund
|
| |
Fidelity Freedom 2035 Fund
|
| |
Fidelity Freedom 2040 Fund
|
| |
Fidelity Freedom 2045 Fund
|
| |
Fidelity Freedom 2050 Fund
|
NOTE 7 – MANAGEMENT OF THE PLAN
The Plan is administered by the Savings Plan Committee of Pfizer Inc., which was appointed by the Board of Directors of the Company. The investment fiduciary function is also governed by the Savings Plan Committee. Effective October 1, 2010, the Northern Trust Company (“Northern Trust”) was appointed the Plan’s trustee and is a party-in-interest to the Plan. Prior to this date, MTC was the Plan’s trustee.
NOTE 8 – FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Plan Sponsor by letter dated February 20, 2008 that the Plan and related trust are designed in accordance with the applicable sections of the Code. The Plan has been amended since receiving the determination letter. However, the Plan Administrator and the Company's counsel believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code. Accordingly, no provision has been made for U.S. federal income taxes in the accompanying financial statements.
Accounting principles generally accepted in the United States of America require Plan management to evaluate tax positions taken by the Plan and recognize a tax liability (or asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the Internal Revenue Service. The Tax Division and Company’s counsel have confirmed that there are no uncertain positions taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan administrator believes it is generally no longer subject to income tax examinations for years prior to 2007.
NOTE 9 – RELATED-PARTY TRANSACTIONS
Northern Trust is the trustee as defined by the Plan; therefore, these transactions qualify as party-in-interest transactions. The Plan also invests in shares of the Company. The Company is the Plan sponsor; therefore, these transactions qualify as party-in-interest transactions.
NOTE 10 – PLAN TERMINATION
Although it has not expressed any intention to do so, the Company has the right under the Plan to terminate or discontinue employee contributions at any time and to terminate the Plan subject to the provisions of ERISA.
NOTE 11 – INVESTMENTS
The fair value of individual investments that represented 5% or more of the Plan’s net assets available for plan benefits as of December 31, 2010 and 2009 were as follows:
| |
|
2010
|
|
|
2009
|
|
| |
|
|
|
|
|
|
|
T. Rowe Price Stable Fund
|
|
$ |
27,895,657 |
|
|
$ |
- |
|
|
Northern Trust S&P 500 Equity Index Fund
|
|
|
19,918,958 |
|
|
|
- |
|
|
Blackrock Core Bond Fund
|
|
|
4,084,407 |
|
|
|
- |
|
|
Investment in Master Trust
|
|
|
|
|
|
|
27,070,835 |
|
|
Fidelity Spartan U.S. Equity Index Fund
|
|
|
|
|
|
|
14,895,871 |
|
|
Fidelity Balanced Fund
|
|
|
|
|
|
|
7,198,371 |
|
During 2010, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value by $4,346,299 as follows:
| Mutual funds |
|
$ |
4,375,062 |
|
|
Common stock
|
|
|
(28,763 |
) |
| |
|
|
|
|
|
Total
|
|
$ |
4,346,299 |
|
NOTE 12 – RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for plan benefits per the financial statements to the Plan's Form 5500 filed for 2009 and expected to be filed for 2010.
| |
|
2010
|
|
|
2009
|
|
| |
|
|
|
|
|
|
|
Net assets available for plan benefits per the financial statements
|
|
$ |
64,269,258 |
|
|
$ |
61,744,658 |
|
| |
|
|
|
|
|
|
|
|
|
Adjustment from contract value to fair value for fully benefit responsive investment contracts
|
|
|
1,045,169 |
|
|
|
289,680 |
|
| |
|
|
|
|
|
|
|
|
|
Net assets available for plan benefits per the Form 5500
|
|
$ |
65,314,427 |
|
|
$ |
62,034,338 |
|
The following is a reconciliation of total investment income per the financial statements to the Form 5500 for the year ended December 31, 2010:
| |
|
2010
|
|
| |
|
|
|
|
Total investment income per the financial statements
|
|
$ |
5,321,571 |
|
| |
|
|
|
|
|
Adjustment from contract value to fair value for fully benefit responsive investment contracts
|
|
|
755,489 |
|
| |
|
|
|
|
|
Total investment income per the Form 5500
|
|
$ |
6,077,060 |
|
Schedule I
Wyeth Union Savings Plan
Schedule H, Line 4i – Schedule of Assets (Held at End of Year)
December 31, 2010
Employer Identification Number – 13-5315170
Plan Number – 017
|
Identity of Issuer
|
|
Description of Investment
|
Cost**
|
|
Current Value
|
|
| |
|
|
|
|
|
|
|
Blackrock Fund Advisors
|
|
LifePath Retirement Portfolio
|
|
|
|
|
| |
|
39,849 shares
|
|
|
$ |
405,600 |
|
| |
|
|
|
|
|
|
|
|
Blackrock Fund Advisors
|
|
LifePath 2020 Portfolio
|
|
|
|
|
|
| |
|
146,054 shares
|
|
|
|
1,534,880 |
|
| |
|
|
|
|
|
|
|
|
Blackrock Fund Advisors
|
|
LifePath 2030 Portfolio
|
|
|
|
|
|
| |
|
168,793 shares
|
|
|
|
1,805,714 |
|
| |
|
|
|
|
|
|
|
|
Blackrock Fund Advisors
|
|
LifePath 2040 Portfolio
|
|
|
|
|
|
| |
|
78,310 shares
|
|
|
|
848,374 |
|
| |
|
|
|
|
|
|
|
|
Blackrock Institutional Trust
|
|
Core Bond Fund
|
|
|
|
|
|
| |
|
414,393 shares
|
|
|
|
4,084,407 |
|
| |
|
|
|
|
|
|
|
|
Blackrock Fund Advisors
|
|
TIPS Index Fund
|
|
|
|
|
|
| |
|
6,768 shares
|
|
|
|
65,150 |
|
| |
|
|
|
|
|
|
|
|
Dodge and Cox
|
|
International Fund
|
|
|
|
|
|
| |
|
177,543 shares
|
|
|
|
1,912,633 |
|
| |
|
|
|
|
|
|
|
|
Eaton Vance
|
|
Large Cap Value Fund
|
|
|
|
|
|
| |
|
8,668 shares
|
|
|
|
95,251 |
|
| |
|
|
|
|
|
|
|
|
Fidelity Management Trust Company
|
|
Large Cap Growth Fund
|
|
|
|
|
|
| |
|
44,481 shares
|
|
|
|
495,276 |
|
| |
|
|
|
|
|
|
|
|
Fidelity Management Trust Company
|
|
Low Price Stock Fund
|
|
|
|
|
|
| |
|
2,5182 shares
|
|
|
|
278,763 |
|
| |
|
|
|
|
|
|
|
|
Fidelity Management Trust Company
|
|
Mid Cap Stock Fund
|
|
|
|
|
|
| |
|
14,957 shares
|
|
|
|
171,220 |
|
| |
|
|
|
|
|
|
|
|
Northern Trust Global Investments*
|
|
S&P 500 Equity Index Fund
|
|
|
|
|
|
| |
|
1,800,630 shares
|
|
|
|
19,918,958 |
|
| |
|
|
|
|
|
|
|
|
Northern Trust Global Investments*
|
|
Russell 2000 Small Cap Index Fund
|
|
|
|
|
|
| |
|
147,394 shares
|
|
|
|
1,704,408 |
|
Schedule 1
Wyeth Union Savings Plan
Schedule H, Line 4i – Schedule of Assets (Held at End of Year)
December 31, 2010
Employer Identification Number – 13-5315170
Plan Number – 017
|
Identity of Issuer
|
|
Description of Investment
|
Cost**
|
|
Current Value
|
|
| |
|
|
|
|
|
|
|
Pfizer Inc.*
|
|
Common Stock
|
|
|
|
|
| |
|
138,436 shares
|
|
|
|
1,407,161 |
|
| |
|
|
|
|
|
|
|
|
T. Rowe Price Associates, Inc.
|
|
Small Cap Stock
|
|
|
|
|
|
| |
|
26 shares
|
|
|
|
252 |
|
| |
|
|
|
|
|
|
|
|
T. Rowe Price Trust Company
|
|
Stable Value Fund
|
|
|
|
|
|
| |
|
2,661,724 shares
|
|
|
|
27,895,657 |
|
| |
|
|
|
|
|
|
|
|
OppenheimerFunds, Inc.
|
|
Developing Market Fund
|
|
|
|
|
|
| |
|
77,677 shares
|
|
|
|
845,508 |
|
| |
|
|
|
|
|
|
|
|
Total investments
|
|
|
|
|
|
63,469,212 |
|
| |
|
|
|
|
|
|
|
| Notes receivable from participants |
|
|
|
|
|
1,757,900 |
|
| |
|
|
|
|
|
|
|
| Total |
|
|
|
|
$ |
65,227,112 |
|
|
*
|
Represents a party-in-interest to the Plan.
|
|
**
|
Cost not required for participant directed investments.
|
See accompanying report of independent registered public accounting firm.