EXHIBIT 10.4
AMENDED EMPLOYMENT AGREEMENT
PREAMBLE
This Employment Agreement defines the essential terms and conditions of our
employment
relationship with you. The subjects covered in this Agreement are vitally
important to you and to
the Company. Thus, you should read the document carefully and ask any questions
before
signing the Agreement. Given the importance of these matters to you and the
Company, you are
required to sign the Agreement as a condition of employment.
     This EMPLOYMENT AGREEMENT, dated and effective this 31st day of March 2008
is entered into by and between Hillenbrand Industries, Inc. (to be renamed
Hill-Rom Holdings, Inc.) (“Company”) and Patrick de Maynadier (“Employee”).
WITNESSETH:
     WHEREAS, the Company and its various affiliated entities are engaged in the
healthcare industry throughout the United States and abroad, including, but not
limited to, the design, manufacture, sale, service and rental of hospital beds
and stretchers, hospital furniture, medical-related architectural products,
specialty sleep surfaces (including therapeutic surfaces), air clearing devices,
biomedical and asset management services, as well as other medical-related
accessories, devices, products and services;
     WHEREAS, the Company is willing to employ Employee in an executive or
managerial position and Employee desires to be employed by the Company in such
capacity based upon the terms and conditions set forth in this Agreement;
     WHEREAS, in the course of the employment contemplated under this Agreement
and as a continuation of Employee’s past employment with the Company, if
applicable, it will be necessary for Employee to acquire and maintain knowledge
of certain trade secrets and other confidential and proprietary information
regarding the Company as well as any of its parent, subsidiary and/or affiliated
entities (hereinafter jointly referred to as the “Companies”); and
     WHEREAS, the Company and Employee (collectively referred to as the
“Parties”) acknowledge and agree that the execution of this Agreement is
necessary to memorialize the terms and conditions of their employment
relationship as well as safeguard against the unauthorized disclosure or use of
the Company’s confidential information and to otherwise preserve the goodwill
and ongoing business value of the Company;
     NOW THEREFORE, in consideration of Employee’s employment, the Company’s
willingness to disclose certain confidential and proprietary information to
Employee and the mutual covenants contained herein as well as other good and
valuable consideration, the receipt of which is hereby acknowledged, the Parties
agree as follows:

1.   Employment. As of the effective date of this Agreement, the Company agrees
to employ Employee as, and Employee agrees to serve as, Senior Vice President,
General Counsel and Secretary. Employee agrees to perform all duties and
responsibilities traditionally assigned to, or falling within the normal
responsibilities of, an individual employed in the

 

--------------------------------------------------------------------------------

 

    above-referenced position, which may include providing relevant business and
legal advice to the Company and any of its parent, subsidiary, and affiliated
entities (e.g., Hillenbrand Industries, Inc., Hill-Rom Company, Inc., Batesville
Services, Inc., and subsidiary entities thereof). Employee also agrees to
perform any and all additional duties or responsibilities as may be assigned by
the Company in its sole discretion. The Parties acknowledge that both this title
and the underlying duties may change.   2.   Best Efforts and Duty of Loyalty.
During the term of employment with the Company, Employee covenants and agrees to
exercise reasonable efforts to perform all assigned duties in a diligent and
professional manner and in the best interest of the Company. Employee agrees to
devote his full working time, attention, talents, skills and best efforts to
further the Company’s business and agrees not to take any action, or make any
omission, that deprives the Company of any business opportunities or otherwise
act in a manner that conflicts with the best interest of the Company or is
otherwise detrimental to its business. Employee agrees not to engage in any
outside business activity, whether or not pursued for gain, profit or other
pecuniary advantage, without the express written consent of the Company.
Employee shall act at all times in accordance with the Company’s Code of Ethical
Business Conduct, and all other applicable policies which may exist or be
adopted by the Company from time to time.

3.   At-Will Employment. Subject to the terms and conditions set forth below,
Employee specifically acknowledges and accepts such employment on an “at-will”
basis and agrees that both Employee and the Company retain the right to
terminate this relationship at any time, with or without cause, for any reason
not prohibited by applicable law upon notice as required by this Agreement.
Employee acknowledges that nothing in this Agreement is intended to create, nor
should be interpreted to create, an employment contract for any specified length
of time between the Company and Employee.

4.   Compensation. For all services rendered by Employee on behalf of, or at the
request of, the Company, Employee shall be paid as follows:

  (a)   A base salary at the bi-weekly rate of Thirteen Thousand Five Hundred
Forty-eight Dollars and Ninety-six Cents ($13,548.96), less usual and ordinary
deductions;     (b)   Incentive compensation, payable solely at the discretion
of the Company, pursuant to the Company’s existing Incentive Compensation
Program or any other program as the Company may establish in its sole
discretion; and     (c)   Such additional compensation, benefits and perquisites
as the Company may deem appropriate.

5.   Changes to Compensation. Notwithstanding anything contained herein to the
contrary, Employee acknowledges that the Company specifically reserves the right
to make changes to Employee’s compensation in its sole discretion including, but
not limited to, modifying or eliminating a compensation component. The Parties
agree that such changes shall be deemed effective immediately and a modification
of this Agreement unless, within seven (7) days after receiving notice of such
change, Employee exercises his right to terminate this

-2-

--------------------------------------------------------------------------------

 

    Agreement without cause or for “Good Reason” as provided below in
Paragraph No. 11. The Parties anticipate that Employee’s compensation structure
will be reviewed on an annual basis but acknowledge that the Company shall have
no obligation to do so.   6.   Direct Deposit. As a condition of employment, and
within thirty (30) days of the effective date of this Agreement, Employee agrees
to make all necessary arrangements to have all sums paid pursuant to this
Agreement direct deposited into one or more bank accounts as designated by
Employee.

7.   Warranties and Indemnification. Employee warrants that he is not a party to
any contract, restrictive covenant, or other agreement purporting to limit or
otherwise adversely affecting his ability to secure employment with any third
party. Alternatively, should any such agreement exist, Employee warrants that
the contemplated services to be performed hereunder will not violate the terms
and conditions of any such agreement. In either event, Employee agrees to fully
indemnify and hold the Company harmless from any and all claims arising from, or
involving the enforcement of, any such restrictive covenants or other
agreements.

8.   Restricted Duties. Employee agrees not to disclose, or use for the benefit
of the Company, any confidential or proprietary information belonging to any
predecessor employer(s) that otherwise has not been made public and further
acknowledges that the Company has specifically instructed him not to disclose or
use such confidential or proprietary information. Based on his understanding of
the anticipated duties and responsibilities hereunder, Employee acknowledges
that such duties and responsibilities will not compel the disclosure or use of
any such confidential and proprietary information.

9.   Termination Without Cause. The Parties agree that either party may
terminate this employment relationship at any time, without cause, upon sixty
(60) days’ advance written notice or, if terminated by the Company, pay in lieu
of notice (hereinafter referred to as “notice pay”). In such event, Employee
shall only be entitled to such compensation, benefits and perquisites that have
been paid or fully accrued as of the effective date of his separation and as
otherwise explicitly set forth in this Agreement. However, in no event shall
Employee be entitled to notice pay if Employee is eligible for and accepts
severance payments pursuant to the provisions of Paragraphs 16 and 17, below.

10.   Termination With Cause. Employee’s employment may be terminated by the
Company at any time “for cause” without notice or prior warning. For purposes of
this Agreement, “cause” shall mean the Company’s good faith determination that
Employee has:

  (a)   Acted with gross neglect or willful misconduct in the discharge of his
duties and responsibilities or refused to follow or comply with the lawful
direction of the Company or the terms and conditions of this Agreement provided
such refusal is not based primarily on Employee’s good faith compliance with
applicable legal or ethical standards;     (b)   Acquiesced or participated in
any conduct that is dishonest, fraudulent, illegal (at the felony level),
unethical, involves moral turpitude or is otherwise illegal and involves

-3-

--------------------------------------------------------------------------------

 

      conduct that has the potential, in the Company’s reasonable opinion, to
cause the Company, its officers or its directors embarrassment or ridicule;    
(c)   Violated a material requirement of any Company policy or procedure,
specifically including a violation of the Company’s Code of Ethical Business
Conduct or Associate Policy Manual;     (d)   Disclosed without proper
authorization any trade secrets or other Confidential Information (as defined
herein);     (e)   Engaged in any act that, in the reasonable opinion of the
Company, is contrary to its best interests or would hold the Company, its
officers or directors up to probable civil or criminal liability, provided that,
if Employee acts in good faith in compliance with applicable legal or ethical
standards, such actions shall not be grounds for termination for cause; or    
(f)   Engaged in such other conduct recognized at law as constituting cause.

    Upon the occurrence or discovery of any event specified above, the Company
shall have the right to terminate Employee’s employment, effective immediately,
by providing notice thereof to Employee without further obligation to him, other
than accrued wages or other accrued wages, deferred compensation or other
accrued benefits of employment (collectively referred to herein as “Accrued
Obligations”), which shall be paid in accordance with the Company’s past
practice and applicable law. To the extent any violation of this Paragraph is
capable of being promptly cured by Employee (or cured within a reasonable period
to the Company’s satisfaction), the Company agrees to provide Employee with a
reasonable opportunity to so cure such defect. Absent written mutual agreement
otherwise, the Parties agree in advance that it is not possible for Employee to
cure any violations of sub-paragraph (b) or (d) and, therefore, no opportunity
for cure need be provided in those circumstances.   11.   Termination by
Employee for Good Reason. Employee may terminate this Agreement and declare this
Agreement to have been terminated “without cause” by the Company (and,
therefore, for “Good Reason”) upon the occurrence, without Employee’s consent,
of any of the following circumstances:

  (a)   The assignment to Employee of duties lasting more than sixty (60) days
that are materially inconsistent with Employee’s then current position or a
material change in his reporting relationship to the CEO or his successor;    
(b)   The failure to elect or reelect Employee as Vice President or other
officer of the Company (unless such failure is related in any way to the
Company’s decision to terminate Employee for cause);     (c)   The failure of
the Company to continue to provide Employee with office space, related
facilities and support personnel (including, but not limited to, administrative
and secretarial assistance) within the Company’s principal executive offices
commensurate with his responsibilities to, and position within, the Company;

-4-

--------------------------------------------------------------------------------

 

  (d)   A reduction by the Company in the amount of Employee’s base salary or
the discontinuation or reduction by the Company of Employee’s participation at
the same level of eligibility as compared to other peer employees in any
incentive compensation, additional compensation, benefits, policies or
perquisites subject to Employee’s understanding that such reduction(s) shall be
permissible if the change applies in a similar way to other peer level
employees;     (e)   The relocation of the Company’s principal executive offices
or Employee’s place of work to a location requiring an increase of more than
fifty (50) miles in Employee’s daily commute, or     (f)   A failure by the
Company to perform its obligations under this Employment Agreement (other than
inadvertent failures that are cured by the Company promptly upon notice from the
Employee).

12.   Termination Due to Death or Disability. In the event Employee dies or
suffers a disability (as defined herein) during the term of employment, this
Agreement shall automatically be terminated on the date of such death or
disability without further obligation on the part of the Company other than the
payment of Accrued Obligations. For purposes of this Agreement, Employee shall
be considered to have suffered a “disability” upon a determination that Employee
cannot perform the essential functions of his position as a result of a such
disability and the occurrence of one or more of the following events:

  (a)   Employee becomes eligible for or receives any benefits pursuant to any
disability insurance policy as a result of a determination under such policy
that Employee is permanently disabled;     (b)   Employee becomes eligible for
or receives any disability benefits under the Social Security Act; or     (c)  
A good faith determination by the Company that Employee is and will likely
remain unable to perform the essential functions of his duties or
responsibilities hereunder on a full-time basis, with or without reasonable
accommodation, as a result of any mental or physical impairment.

    Notwithstanding anything expressed or implied above to the contrary, the
Company agrees to fully comply with its obligations under the Family and Medical
Leave Act of 1993 and the Americans with Disabilities Act as well as any other
applicable federal, state, or local law, regulation, or ordinance governing the
provision of leave to individuals with serious health conditions or the
protection of individuals with disabilities, as well as the Company’s obligation
to provide reasonable accommodation thereunder.   13.   Exit Interview. Upon
termination of Employee’s employment for any reason, Employee agrees, if
requested, to participate in an exit interview with the Company and reaffirm in
writing his post-employment obligations as set forth in this Agreement.   14.  
Section 409A Notification. Employee acknowledges that he has been advised of the
American Jobs Creation Act of 2004, which added Section 409A to the Internal
Revenue

-5-

--------------------------------------------------------------------------------

 

    Code (“Section 409A”), and significantly changed the taxation of
nonqualified deferred compensation plans and arrangements. Under proposed and
final regulations as of the date of this Agreement, Employee has been advised
that his severance pay and other termination benefits may be treated by the
Internal Revenue Service as providing “nonqualified deferred compensation,” and
therefore subject to Section 409A. In that event, several provisions in
Section 409A may affect Employee’s receipt of severance compensation, including
the timing thereof. These include, but are not limited to, a provision which
requires that distributions to “specified employees” of public companies on
account of separation from service may not be made earlier than six (6) months
after the effective date of such separation. If applicable, failure to comply
with Section 409A can lead to immediate taxation of such deferrals, with
interest calculated at a penalty rate and a 20% penalty. As a result of the
requirements imposed by the American Jobs Creation Act of 2004, Employee agrees
if he is a “specified employee” at the time of his termination of employment and
if payments in connection with such termination of employment are subject to
Section 409A and not otherwise exempt, such payments (and other benefits to the
extent applicable) due Employee at the time of termination of employment shall
not be paid until a date at least six (6) months after the effective date of
Employee’s termination of employment (“Employee’s Effective Termination Date”).
Notwithstanding any provision of this Agreement to the contrary, to the extent
that any payment under the terms of this Agreement would constitute an
impermissible acceleration of payments under Section 409A or any regulations or
Treasury guidance promulgated thereunder, such payments shall be made no earlier
than at such times allowed under Section 409A. If any provision of this
Agreement (or of any award of compensation) would cause Employee to incur any
additional tax or interest under Section 409A or any regulations or Treasury
guidance promulgated thereunder, the Company or its successor may reform such
provision; provided that it will (i) maintain, to the maximum extent
practicable, the original intent of the applicable provision without violating
the provisions of Section 409A and (ii) notify and consult with Employee
regarding such amendments or modifications prior to the effective date of any
such change.   15.   Section 409A Acknowledgement. Employee acknowledges that,
notwithstanding anything contained herein to the contrary, both Parties shall be
independently responsible for assessing their own risks and liabilities under
Section 409A that may be associated with any payment made under the terms of
this Agreement or any other arrangement which may be deemed to trigger
Section 409A. Further, the Parties agree that each shall independently bear
responsibility for any and all taxes, penalties or other tax obligations as may
be imposed upon them in their individual capacity as a matter of law. To the
extent applicable, Employee understands and agrees that he shall have the
responsibility for, and he agrees to pay, any and all appropriate income tax or
other tax obligations for which he is individually responsible and/or related to
receipt of any benefits provided in this Agreement. Employee agrees to fully
indemnify and hold the Company harmless for any taxes, penalties, interest, cost
or attorneys’ fee assessed against or incurred by the Company on account of such
benefits having been provided to him or based on any alleged failure to withhold
taxes or satisfy any claims obligation. Employee understands and acknowledges
that neither the Company, nor any of its employees, attorneys, or other
representatives has provided or will provide him with any legal or financial
advice concerning taxes or any other matter, and that he has not relief on any
such advice in deciding whether to enter into this Agreement.

-6-

--------------------------------------------------------------------------------

 

16.   Severance Payments. In the event Employee’s employment is terminated by
the Company without cause (including by Employee for Good Reason), and subject
to the normal terms and conditions imposed by the Company as set forth herein
and in the attached Separation and Release Agreement, Employee shall be eligible
to receive severance pay based upon his base salary at the time of termination
for a period determined in accordance with any guidelines as may be established
by the Company or for a period up to twelve (12) months (whichever is longer).  
17.   Severance Payment Terms and Conditions. No severance pay shall be paid if
Employee voluntarily leaves the Company’s employ without Good Reason, as defined
above, or is terminated for cause. Any severance pay made payable under this
Agreement shall be paid in lieu of, and not in addition to, any other
contractual, notice or statutory pay or other accrued compensation obligation
(excluding accrued wages and deferred compensation). Additionally, such
severance pay is contingent upon Employee fully complying with the restrictive
covenants contained herein and executing a Separation and Release Agreement in a
form not substantially different from that attached as Exhibit A. Further, the
Company’s obligation to provide severance hereunder shall be deemed null and
void should Employee fail or refuse to execute and deliver to the Company such
standard Separation and Release Agreement (without modification) within any time
period as may be prescribed by law or, in absence thereof, twenty-one (21) days
after the Employee’s Effective Termination Date. Conditioned upon the execution
and delivery of the Separation and Release Agreement as set forth in the prior
sentence, severance pay benefits shall be paid as follows: (i) in one lump sum
equivalent to six (6) months’ salary on the day following the date which is six
(6) months following Employee’s Effective Termination Date with any remainder to
be paid in bi-weekly installments equivalent to the Employee’s salary commencing
upon the next regularly scheduled payroll following the earlier to occur of
fifteen (15) days from the Company’s receipt of an executed Separation and
Release Agreement or the expiration of sixty (60) days after Employee’s
Effective Termination Date and shall be paid on the Company’s regularly
scheduled pay dates; provided, however, that if the before-stated sixty (60) day
period ends in a calendar year following the calendar year in which the sixty
(60) day period commenced, then any benefits not subject to clause (i) shall
only begin on the next regularly scheduled payroll following the expiration of
sixty (60) days after the Employee’s Effective Termination Date. Notwithstanding
any other provision contained herein to the contrary, any severance pay benefits
paid pursuant to this Agreement shall not be subject to termination upon
reemployment (however, all other severance benefits, e.g., continued healthcare,
shall cease).   18.   Assignment of Rights.

  (a)   Copyrights. Employee agrees that all works of authorship fixed in any
tangible medium of expression by him during the term of this Agreement relating
to the Company’s business (“Works”), either solely or jointly with others, shall
be and remain exclusively the property of the Company. Each such Work created by
Employee is a “work made for hire” under the copyright law and the Company may
file applications to register copyright in such Works as author and copyright
owner thereof. If, for any reason, a Work created by Employee is excluded from
the definition of a “work made for hire” under the copyright law, then Employee
does hereby assign, sell, and convey to the

-7-

--------------------------------------------------------------------------------

 

      Company the entire rights, title, and interests in and to such Work,
including the copyright therein, to the Company. Employee will execute any
documents that the Company deems necessary in connection with the assignment of
such Work and copyright therein. Employee will take whatever steps and do
whatever acts the Company requests, including, but not limited to placement of
the Company’s proper copyright notice on Works created by Employee to secure or
aid in securing copyright protection in such Works and will assist the Company
or its nominees in filing applications to register claims of copyright in such
Works. The Company shall have free and unlimited access at all times to all
Works and all copies thereof and shall have the right to claim and take
possession on demand of such Works and copies.     (b)   Inventions. Employee
agrees that all discoveries, concepts, and ideas, whether patentable or not,
including, but not limited to, apparatus, processes, methods, compositions of
matter, techniques, and formulae, as well as improvements thereof or know-how
related thereto, relating to any present or prospective product, process, or
service of the Company (“Inventions”) that Employee conceives or makes during
the term of this Agreement relating to the Company’s business, shall become and
remain the exclusive property of the Company, whether patentable or not, and
Employee will, without royalty or any other consideration:

  (i)   Inform the Company promptly and fully of such Inventions by written
reports, setting forth in detail the procedures employed and the results
achieved;     (ii)   Assign to the Company all of his rights, title, and
interests in and to such Inventions, any applications for United States and
foreign Letters Patent, any United States and foreign Letters Patent, and any
renewals thereof granted upon such Inventions;     (iii)   Assist the Company or
its nominees, at the expense of the Company, to obtain such United States and
foreign Letters Patent for such Inventions as the Company may elect; and    
(iv)   Execute, acknowledge, and deliver to the Company at the Company’s expense
such written documents and instruments, and do such other acts, such as giving
testimony in support of his inventorship, as may be necessary in the opinion of
the Company, to obtain and maintain United States and foreign Letters Patent
upon such Inventions and to vest the entire rights and title thereto in the
Company and to confirm the complete ownership by the Company of such Inventions,
patent applications, and patents.

19.   Company Property. All records, files, drawings, documents, data in
whatever form, business equipment (including computers, PDAs, cell phones,
etc.), and the like relating to, or provided by, the Company shall be and remain
the sole property of the Company. Upon termination of employment, Employee shall
immediately return to the Company all such items without retention of any copies
and without additional request by the Company. De minimis items such as pay
stubs, 401(k) plan summaries, employee bulletins, and the like are excluded from
this requirement. Further, sample legal forms and other related items

-8-

--------------------------------------------------------------------------------

 

    developed by the Employee during the legal term of his employment may be
retained and used by him thereafter provided they are not used to compete
against the Company.   20.   Confidential Information. Employee acknowledges
that the Company and its affiliated entities (herein collectively referred to as
“Companies”) possess certain trade secrets as well as other confidential and
proprietary information which they have acquired or will acquire at great effort
and expense. Such information may include, without limitation, confidential
information, whether in tangible or intangible form, regarding the Companies’
products and services, marketing strategies, business plans, operations, costs,
current or prospective customer information (including customer identities,
contacts, requirements, creditworthiness, preferences, and like matters),
product concepts, designs, prototypes or specifications, research and
development efforts, technical data and know-how, sales information, including
pricing and other terms and conditions of sale, financial information, internal
procedures, techniques, forecasts, methods, trade information, trade secrets,
software programs, project requirements, inventions, trademarks, trade names,
and similar information regarding the Companies’ business(es) (collectively
referred to herein as “Confidential Information”). Employee further acknowledges
that, as a result of his employment with the Company, Employee will have access
to, will become acquainted with, and/or may help develop, such Confidential
Information. Confidential Information shall not include information readily
available in the public so long as such information was not made available
through fault of Employee or wrong doing by any other individual.   21.  
Restricted Use of Confidential Information. Employee agrees that all
Confidential Information is and shall remain the sole and exclusive property of
the Company and/or its affiliated entities. Except as may be expressly
authorized by the Company in writing, Employee agrees not to disclose, or cause
any other person or entity to disclose, any Confidential Information to any
third party while employed by the Company and for as long thereafter as such
information remains confidential (or as limited by applicable law). Further,
Employee agrees to use such Confidential Information only in the course of
Employee’s duties in furtherance of the Company’s business and agrees not to
make use of any such Confidential Information for Employee’s own purposes or for
the benefit of any other entity or person.   22.   Acknowledged Need for Limited
Restrictive Covenants. Employee acknowledges that the Companies have spent and
will continue to expend substantial amounts of time, money and effort to develop
their business strategies, Confidential Information, customer identities and
relationships, goodwill and employee relationships, and that Employee will
benefit from these efforts. Further, Employee acknowledges the inevitable use
of, or near-certain influence by his knowledge of, the Confidential Information
disclosed to Employee during the course of employment if allowed to compete
against the Company in an unrestricted manner and that such use would be unfair
and extremely detrimental to the Company. Accordingly, based on these legitimate
business reasons, Employee acknowledges each of the Companies’ need to protect
their legitimate business interests by reasonably restricting Employee’s ability
to compete with the Company on a limited basis.

-9-

--------------------------------------------------------------------------------

 

23.   Non-Solicitation. During Employee’s employment and for a period of
eighteen (18) months thereafter, Employee agrees not to directly or indirectly
engage in the following prohibited conduct:

  (a)   Solicit, offer products or services to, or accept orders for, any
Competitive Products or otherwise transact any competitive business with, any
customer or entity with whom Employee had contact or transacted any business on
behalf of the Company (or any Affiliate thereof) during the eighteen (18) month
period preceding Employee’s date of separation or about whom Employee possessed,
or had access to, confidential and proprietary information;     (b)   Attempt to
entice or otherwise cause any third party to withdraw, curtail, or cease doing
business with the Company (or any Affiliate thereof), specifically including
customers, vendors, independent contractors and other third party entities;    
(c)   Disclose to any person or entity the identities, contacts or preferences
of any customers of the Company (or any Affiliate thereof), or the identity of
any other persons or entities having business dealings with the Company (or any
Affiliate thereof);     (d)   Induce any individual who has been employed by or
had provided services to the Company (or any Affiliate thereof) within the six
(6) month period immediately preceding the effective date of Employee’s
separation to terminate such relationship with the Company (or any Affiliate
thereof);     (e)   Assist, coordinate or otherwise offer employment to, accept
employment inquiries from, or employ any individual who is or had been employed
by the Company (or any Affiliate thereof) at any time within the six (6) month
period immediately preceding such offer, or inquiry;     (f)   Communicate or
indicate in any way to any customer of the Company (or any Affiliate thereof),
prior to formal separation from the Company, any interest, desire, plan, or
decision to separate from the Company; or     (g)   Otherwise attempt to
directly or indirectly interfere with the Company’s business, the business of
any of the Companies or their relationship with their employees, consultants,
independent contractors or customers.

24.   Limited Non-Compete. For the above-stated reasons, and as a condition of
employment to the fullest extent permitted by law, Employee agrees during the
Relevant Non-Compete Period while serving in any capacity other than as legal
counsel for the Company or another client not to directly or indirectly engage
in the following competitive activities:

  (a)   Employee shall not have any ownership interest in, work for, advise,
consult, or have any business connection or business or employment relationship
in any competitive capacity with any Competitor unless Employee provides written
notice to the Company of such relationship prior to entering into such
relationship and, further, provides sufficient written assurances to the
Company’s satisfaction that such relationship will

-10-

--------------------------------------------------------------------------------

 

      not, jeopardize the Company’s legitimate interests or otherwise violate
the terms of this Agreement;     (b)   Employee shall not engage in any
research, development, production, sale or distribution of any Competitive
Products, specifically including any products or services relating to those for
which Employee had responsibility for the eighteen (18) month period preceding
Employee’s date of separation;     (c)   Employee shall not market, sell, or
otherwise offer or provide any Competitive Products within his Geographic
Territory (if applicable) or Assigned Customer Base, specifically including any
products or services relating to those for which Employee had responsibility for
the eighteen (18) month period preceding Employee’s date of separation; and    
(d)   Employee shall not distribute, market, sell or otherwise offer or provide
any Competitive Products to any customer of the Company with whom Employee had
contact or for which Employee had responsibility at any time during the eighteen
(18) month period preceding Employee’s date of separation.

25.   Non-Compete Definitions. For purposes of this Agreement, the Parties agree
that the following terms shall apply:

  (a)   “Affiliate” includes any parent, subsidiary, joint venture, sister
company, or other entity controlled, owned, managed or otherwise associated with
the Company;     (b)   “Assigned Customer Base” shall include all accounts or
customers formally assigned to Employee within a given territory or geographical
area or contacted by him at any time during the eighteen (18) month period
preceding Employee’s date of separation;     (c)   “Competitive Products” shall
include any product or service that directly or indirectly competes with, is
substantially similar to, or serves as a reasonable substitute for, any product
or service in research, development or design, or manufactured, produced, sold
or distributed by the Company;     (d)   “Competitor” shall include any person
or entity that offers or is actively planning to offer any Competitive Products
and may include (but not be limited to) any entity identified on the Company’s
Illustrative Competitor List and the Batesville Casket Company Illustrative
Competitor List, attached hereto as Exhibits B and C, which shall be amended
from time to time to reflect changes in the Company’s business and competitive
environment (updated competitor lists will be provided to Employee upon
reasonable request). However, if Employee is still employed by Company as of
September 30, 2009, the term Competitor shall no longer include the Companies
listed on the Batesville Casket Company Illustrative Competitor List;     (e)  
“Geographic Territory” shall include any territory formally assigned to Employee
as well as all territories in which Employee has provided any services, sold any
products or otherwise had responsibility at any time during the eighteen
(18) month period preceding Employee’s date of separation;

-11-

--------------------------------------------------------------------------------

 

  (f)   “Relevant Non-Compete Period” shall include the period of Employee’s
employment with the Company as well as a period of eighteen (18) months after
such employment is terminated, regardless of the reason for such termination
provided, however, that this period shall be reduced to the greater of (i) nine
(9)months or (ii) the total length of Employee’s employment with the Company,
including employment with any parent, subsidiary or affiliated entity, if such
employment is less than eighteen (18) months;     (g)   “Directly or indirectly”
shall be construed such that the foregoing restrictions shall apply equally to
Employee whether performed individually or as a partner, shareholder, officer,
director, manager, employee, salesman, independent contractor, broker, agent, or
consultant for any other individual, partnership, firm, corporation, company, or
other entity engaged in such conduct.

26.   Consent to Reasonableness. In light of the above-referenced concerns,
including Employee’s knowledge of and access to the Companies’ Confidential
Information, Employee acknowledges that the terms of the foregoing restrictive
covenants are reasonable and necessary to protect the Company’s legitimate
business interests and will not unreasonably interfere with Employee’s ability
to obtain alternate employment. As such, Employee hereby agrees that such
restrictions are valid and enforceable, and affirmatively waives any argument or
defense to the contrary. Employee acknowledges that this limited non-competition
provision is not an attempt to prevent Employee from obtaining other employment
in violation of IC Section 22-5-3-1 or any other similar statute. Employee
further acknowledges that the Company may need to take action, including
litigation, to enforce this limited non-competition provision, which efforts the
Parties stipulate shall not be deemed an attempt to prevent Employee from
obtaining other employment.

27.   Ethical Obligations. Notwithstanding anything contained herein to the
contrary, Employee acknowledges that he has certain independent ethical
obligation concerning confidentiality and conflicts of interest imposed by the
applicable provisions of the Indiana Rules of Professional Conduct (as well as
possibly other model rules of professional conduct), which prevent or limit
Employee in his capacity as an attorney from representing or otherwise working
for any direct or indirect competitor of the Company whose interest may be
materially adverse to the interest of the Company as well as prohibit Employee
from disclosing, relying upon or otherwise using Company information for the
benefit of such competitors. Employee acknowledges that such ethical
obligations, specifically including Rules 1.6 through 1.9 of the Indiana Rule of
Professional Conduct, shall be deemed part of this Agreement and shall run
concurrent with all other restrictive covenant obligations contained herein.

28.   Survival of Restrictive Covenants. Employee acknowledges that the above
restrictive covenants shall survive the termination of this Agreement and the
termination of Employee’s employment for any reason. Employee further
acknowledges that any alleged breach by the Company of any contractual,
statutory or other obligation shall not excuse or terminate the obligations
hereunder or otherwise preclude the Company from seeking injunctive or other
relief. Rather, Employee acknowledges that such obligations are independent and
separate covenants undertaken by Employee for the benefit of the Company.

-12-

--------------------------------------------------------------------------------

 

29.   Effect of Transfer. Employee agrees that this Agreement shall continue in
full force and effect notwithstanding any change in job duties, job titles or
reporting responsibilities. Employee further acknowledges that the above
restrictive covenants shall survive, and be extended to cover, the transfer of
Employee from the Company to its parent, subsidiary, sister corporation or any
other affiliated entity (hereinafter collectively referred to as an “Affiliate”)
or any subsequent transfer(s) among them. Specifically, in the event of
Employee’s temporary or permanent transfer to an Affiliate, he agrees that the
foregoing restrictive covenants shall remain in force so as to continue to
protect such company for the duration of the non-compete period, measured from
his effective date of transfer to an Affiliate. Additionally, Employee
acknowledges that this Agreement shall be deemed to have been automatically
assigned to the Affiliate as of his effective date of transfer such that the
above-referenced restrictive covenants (as well as all other terms and
conditions contained herein) shall be construed thereafter to protect the
legitimate business interests and goodwill of the Affiliate as if Employee and
the Affiliate had independently entered into this Agreement. Employee’s
acceptance of his transfer to, and subsequent employment by, the Affiliate shall
serve as consideration for (as well as be deemed as evidence of his consent to)
the assignment of this Agreement to the Affiliate as well as the extension of
such restrictive covenants to the Affiliate. Employee agrees that this provision
shall apply with equal force to any subsequent transfers of Employee from one
Affiliate to another Affiliate.

30.   Post-Termination Notification. For the duration of his Relevant
Non-compete Period or other restrictive covenant period, which ever is longer,
Employee agrees to promptly notify the Company no later than five (5) business
days of his acceptance of any employment or consulting engagement. Such notice
shall include sufficient information to ensure Employee compliance with his
non-compete obligations and must include at a minimum the following information:
(i) the name of the employer or entity for which he is providing any consulting
services; (ii) a description of his intended duties as well as (iii) the
anticipated start date. Such information is required to ensure Employee’s
compliance with his non-compete obligations as well as all other applicable
restrictive covenants. Such notice shall be provided in writing to the Office of
Vice President and General Counsel of the Company at 1069 State Road 46 E,
Batesville, Indiana 47006. Failure to timely provide such notice shall be deemed
a material breach of this Agreement and entitle the Company to return of any
severance paid to Employee plus attorneys’ fees. Employee further consents to
the Company’s notification to any new employer of Employee’s rights and
obligations under this Agreement.

31.   Scope of Restrictions. If the scope of any restriction contained in any
preceding paragraphs of this Agreement is deemed too broad to permit enforcement
of such restriction to its fullest extent, then such restriction shall be
enforced to the maximum extent permitted by law, and Employee hereby consents
and agrees that such scope may be judicially modified accordingly in any
proceeding brought to enforce such restriction. The Parties agree that the
foregoing restrictions shall not be construed to prohibit Employee from the
general practice of law provided, however, that any such practice of law must be
consistent with Employee’s ethical obligations to maintain as confidential
information protected by the attorney-client privilege, attorney work product
doctrine or similar doctrines.

-13-

--------------------------------------------------------------------------------

 

32.   Specific Enforcement/Injunctive Relief. Employee agrees that it would be
difficult to measure any damages to the Company from a breach of the
above-referenced restrictive covenants, but acknowledges that the potential for
such damages would be great, incalculable and irremediable, and that monetary
damages along would be an inadequate remedy. Accordingly, Employee agrees that
the Company shall be entitled to immediate injunctive relief against such
breach, or threatened breach, in any court having jurisdiction. In addition, if
Employee violates any such restrictive covenant, Employee agrees that the period
of such violation shall be added to the term of the restriction. In determining
the period of any violation, the Parties stipulate that in any calendar month in
which Employee engages in any activity in violation of such provisions, Employee
shall be deemed to have violated such provision for the entire month, and that
month shall be added to the duration of the non-competition provision. Employee
acknowledges that the remedies described above shall not be the exclusive
remedies, and the Company may seek any other remedy available to it either in
law or in equity, including, by way of example only, statutory remedies for
misappropriation of trade secretes, and including the recovery of compensatory
or punitive damages. Employee further agrees that the Company shall be entitled
to an award of all costs and attorneys fees incurred by it in any attempt to
enforce the terms of this Agreement.

33.   Publicly Traded Stock. The Parties agree that nothing contained in this
Agreement shall be construed to prohibit Employee from investing his personal
assets in any stock or corporate security traded or quoted on a national
securities exchange or national market system provided, however, such
investments do not require any services on the part of Employee in the operation
or the affairs of the business or otherwise violate the Company’s Code of
Ethical Business Conduct.

34.   Notice of Claim and Contractual Limitations Period. Employee acknowledges
the Company’s need for prompt notice, investigation, and resolution of any
claims that may be filed against it due to the number of relationships it has
with employees and others (and due to the turnover among such individuals with
knowledge relevant to any underlying claim). Accordingly, but not limited to,
employment discrimination litigation, wage litigation, defamation, or any other
claim) to notify the Company, within One Hundred and Eighty (18) days after the
claim accrued, by sending a certified letter addressed to the Company’s General
Counsel setting forth: (i) claimant’s name, address, and phone; (ii) the name of
any attorney representative Employee; (iii) the nature of the claim; (iv) the
date the claim arose; and (v) the relief requested. This provision is in
addition to any other notice and exhaustion requirements that might apply. For
any dispute or claim of any type against the Company (including but not limited
to employment discrimination litigation, wage litigation, defamation, or any
other claim), Employee must commence legal action within the shorter of one
(1) year of accrual of the cause of action or such shorter period that may be
specified by law.

35.   Non-Jury Trials. Notwithstanding any right to a jury trial for any claims,
Employee waives any such right to a jury trial, and agrees that any claim of any
type (including but not limited to employee discrimination litigation, wage
litigation, defamation, or any other claim) lodged in any court will be tried,
if at all, without a jury.

-14-

--------------------------------------------------------------------------------

 

36.   Choice of Forum. Employee acknowledges that the Company is primarily based
in Indiana, and Employee understands and acknowledges the Company’s desire and
need to defend any litigation against it in Indiana. Accordingly, the Parties
agree that any claim of any type brought by Employee against the Company or any
of its employees or agents must be maintained only in a court sitting in Marion
County, Indiana, or Ripley County, Indiana, or, if a federal court, the Southern
District of Indiana, Indianapolis Division. Employee further understands and
acknowledges that in the event the Company initiates litigation against
Employee, the Company may need to prosecute such litigation in such state where
the Employee is subject to personal jurisdiction. Accordingly, for purposes of
enforcement of this Agreement, Employee specifically consents to personal
jurisdiction in the State of Indiana as well as any state in which resides a
customer assigned to the Employee. Furthermore, Employee consents to appear,
upon Company’s request and at Employee’s own cost, for deposition, hearing,
trial, or other court proceeding in Indiana or in any state in which resides a
customer assigned to the Employee.

37.   Choice of Law. This Agreement shall be deemed to have been made within the
County of Ripley, State of Indiana and shall be interpreted and construed in
accordance with the laws of the State of Indiana. Any and all matters of dispute
of any nature whatsoever arising out of, or in any way connected with the
interpretation of this Agreement, any disputes arising out of the Agreement or
the employment relationship between the Parties hereto, shall be governed by,
construed by and enforced in accordance with the laws of the State of Indiana
without regard to any applicable state’s choice of law provisions.

38.   Titles. Titles are used for the purpose of convenience in this Agreement
and shall be ignored in any construction of it.

39.   Severability. The Parties agree that each and ever paragraph, sentence,
clause, term and provision of this Agreement is severable and that, in the event
any portion of this Agreement is adjudged to be invalid or unenforceable, the
remaining portions thereof shall remain in effect and be enforced to the fullest
extent permitted by law. Further, should any particular clause, covenant, or
provision of this Agreement be held unreasonable or contrary to public policy
for any reason, the Parties acknowledge and agree that such covenant, provision
or clause shall automatically be deemed modified such that the contested
covenant, provision or clause will have the closest effect permitted by
applicable law to the original form and shall be given effect and enforced as so
modified to whatever extent would be reasonable and enforceable under applicable
law.

40.   Assignment-Notices. The rights and obligations of the Company under this
Agreement shall inure to its benefit, as well as the benefit of its parent,
subsidiary, successor and affiliated entities, and shall be binding upon the
successors and assigns of the Company. This Agreement, being personal to
Employee, cannot be assigned by Employee, but his personal representative shall
be bound by all its terms and conditions. Any notice required hereunder shall be
sufficient if in writing and mailed to the last known residence of Employee or
to the Company at its principal office with a copy mailed to the Office of the
General Counsel.

41.   Amendments and Modifications. Except as specifically provided herein, no
modification, amendment, extension or waiver of this Agreement or any provision
hereof shall be binding

-15-

--------------------------------------------------------------------------------

 

    upon the Company or Employee unless in writing and signed by both Parties.
The waiver by the Company or Employee of a breach of any provision of this
Agreement shall not be construed as a waiver of any subsequent breach. Nothing
in this Agreement shall be construed as a limitation upon the Company’s right to
modify or amend any of its manuals or policies in its sole discretion and any
such modification or amendment which pertains to matters addressed herein shall
be deemed to be incorporated herein and made a part of this Agreement.   42.  
Outside Representations. Employee represents and acknowledges that in signing
this Agreement he does not rely, and has not relief, upon any representation or
statement made by the Company or by any of the Company’s employees, officers,
agents, stockholders, directors or attorneys with regard to the subject matter,
basis or effect of this Agreement other than those specifically contained
herein.   43.   Voluntary and Knowing Execution. Employee acknowledges that he
has been offered a reasonable amount of time within which to consider and review
this Agreement; that he has carefully read and fully understands all of the
provisions of this Agreement; and that he has entered into this Agreement
knowingly and voluntarily.

44.   Entire Agreement. This Agreement constitutes the entire employment
agreement between the Parties hereto concerning the subject matter hereof and
shall supersede all prior and contemporaneous agreements between the Parties in
connection with the subject matter of this Agreement. Any pre-existing
Employment Agreements shall be deemed null and void. Nothing in this Agreement,
however, shall affect any separately-executed written agreement addressing any
other issues (e.g., the Inventions, Improvements, Copyrights and Trade Secrets
Agreement, etc.).

          IN WITNESS WHEREOF, the parties have signed this Agreement effective
as of the day and year first above written.

                          “EMPLOYEE”       HILLENBRAND INDUSTRIES, INC.        
        (to be renamed Hill-Rom Holdings, Inc.)    
 
                       
Signed:
          By:                                  
Printed:
              Title:        
 
                       
Dated:
              Dated:        
 
 
 
             
 
   

-16-

--------------------------------------------------------------------------------

 

EXHIBIT A
SAMPLE SEPARATION AND RELEASE AGREEMENT
     THIS SEPARATION and RELEASE AGREEMENT (“Agreement”) is entered into by and
between Patrick de Maynadier (“Employee”) and Hillenbrand Industries, Inc. (to
be renamed Hill-Rom Holdings, Inc.) (together with its subsidiaries and
affiliates, the “Company”). To wit, the Parties agree as follows:

1.   Employee’s active employment by the Company shall terminate effective [DATE
OF TERMINATION] (Employee’s “Effective Termination Date”). Except as
specifically provided by this Agreement, or in any other non-employment
Agreement that may exist between the Company and Employee, Employee agrees that
the Company shall have no other obligations or liabilities to him following his
Effective Termination Date and that his receipt of the Severance Benefits
provided herein shall constitute a complete settlement, satisfaction and waiver
of any and all claims he may have against the Company.

2.   Employee further submits, and the Company hereby accepts, his resignation
as an employee, officer and director, as of his Effective Termination Date for
any position he may hold. The Parties agree that this resignation shall apply to
all such positions Employee may hold with the Company or any parent, subsidiary
or affiliated entity thereof. Employee agrees to execute any documents needed to
effectuate such resignation. Employee further agrees to take whatever steps are
necessary to facilitate and ensure the smooth transaction of this duties and
responsibilities to others.

3.   Employee acknowledges that he has been advised of the American Jobs
Creation Act of 2004, which added Section 409A (“Section 409A”) to the Internal
Revenue Code, and significantly changed the taxation of nonqualified deferred
compensation plans and arrangements. Under proposed and final regulations as of
the date of this Agreement, Employee has been advised that his severance pay may
be treated by the Internal Revenue Service as providing “nonqualified deferred
compensation,” and therefore subject to Section 409A. In that event, several
provisions in Section 409A may affect Employee’s receipt of severance
compensation. These include, but are not limited to, a provision which requires
that distributions to “specified employees” of public companies on account of
separation from service may not be made earlier than six (6) months after the
effective date of such separation. If applicable, failure to comply with
Section 409A can lead to immediate taxation of deferrals, with interest
calculated at a penalty rate and a 20% penalty. As a result of the requirements
imposed by the American Jobs Creation Act of 2004, Employee agrees if he is a
“specified employee” at the time of his termination of employment and if
severance payments are covered as “non-qualified deferred compensation” or
otherwise not exempt, the severance pay benefits shall not be paid until a date
at least six (6) months after Employee’s Effective Termination Date from
Company, as more fully explained by Paragraph 4, below.

 

--------------------------------------------------------------------------------

 

4.   In consideration of the promises contained in this Agreement and contingent
upon Employee’s compliance with such promises, the Company agrees to provide
Employee the following:

  (a)   Severance pay, in lieu of, and not in addition to any other contractual,
notice or statutory pay obligations (other than accrued wages and deferred
compensation) in the maximum total amount of [INSERT AMOUNT] Dollars and [ ]
Cents ($[ ]), less applicable deductions or other set offs, payable as follows:

    [For 409A Severance Pay for Specified Employees Only]

  (i)   A lump payment in the gross amount of [INSERT AMOUNT EQUAL TO 6 MONTHS’
PAY] Dollars and [      ] Cents ($[                    ]) payable the day
following the sixth (6th) month anniversary of Employee’s Effective Termination
Date with any remaining amount to be paid in bi-weekly installments equivalent
to Employee’s base salary (i.e.,                      Dollars and
                     Cents ($                    ), less applicable deductions
or other setoffs) commencing upon the next regularly scheduled payroll date
after the payment of the lump sum for a period of up to                     
weeks.

    [For Non-409A Severance Pay or 409A Severance pay for Non-Specified
Employees Only]

  (i)   Commencing on the next regularly scheduled payroll immediately following
the earlier to occur of fifteen (15) days from the Company’s receipt of an
executed Separation and Release Agreement or the expiration of sixty (60) days
after Employee’s Effective Termination Date, Employee shall be paid severance
equivalent to his bi-weekly base salary (i.e.                      Dollars and
                     Cents ($                    ), less applicable deductions
or other set-offs), for a period up to [insert weeks] (     ) weeks following
Employee’s Effective Termination Date; provided, however, that if the
before-stated sixty (60) day period ends in a calendar year following the
calendar year in which the sixty (60) day period commenced, then this severance
pay shall only begin on the next regularly scheduled payroll following the
expiration of sixty (60) days after the Employee’s Effective Termination Date.

  (b)   Payment for any earned but unused vacation as of Employee’s Effective
Termination Date, less applicable deductions permitted or required by law,
payable in one lump sum within fifteen (15) days after the Employee’s Effective
Termination Date; and     (c)   Group Life Insurance coverage until the
above-referenced Severance Pay terminates.

2

--------------------------------------------------------------------------------

 

5.   Except as may be required by Section 409A, the above Severance Pay shall be
paid in accordance with the Company’s standard payroll practices (e.g.
bi-weekly). The Parties agree that the initial two (2) weeks of the foregoing
Severance Pay shall be allocated as consideration provided to Employee in
exchange for his execution of a release in compliance with the Older Workers
Benefit Protection Act. The balance of the severance benefits and other
obligations undertaken by the Company pursuant to this Agreement shall be
allocated as consideration for all other promises and obligations undertaken by
Employee, including execution of a general release of claims.

6.   The Company further agrees to provide Employee with limited out-placement
counseling with a company of its choice provided that Employee participated in
such counseling immediately following termination of employment. Notwithstanding
anything in this Section 6 to the contrary, the out-placement counseling shall
not be provided after the last day of the second calendar year following the
calendar year in which termination of employment occurs.

7.   As of his Effective Termination Date, Employee will become ineligible to
participate in the Company’s health insurance program and continuation of
coverage requirements under COBRA (if any) will be triggered at that time.
However, as additional consideration for the promises and obligations contained
herein (and except as may be prohibited by law), the Company agrees to continue
to pay the employer’s share of such coverage as provided under the health care
program selected by Employee as of his Effective Termination Date, subject to
any approved changes in coverage based on a qualified election, until the
above-referenced Severance Pay terminates, Employee accepts other employment or
Employee becomes eligible for alternative healthcare coverage, which ever comes
first, provided Employee (i) timely completes the applicable election of
coverage forms and (ii) continues to pay the employee portion of the applicable
premium(s). Thereafter, if applicable, coverage will be made available to
Employee at his sole expense (i.e., Employee will be responsible for the full
COBRA premium) for the remaining months of the COBRA coverage period made
available pursuant to applicable law. The medical insurance provided herein does
not include any disability coverage.

8.   Should Employee become employed before the above-referenced Severance
Benefits are exhausted or terminated, Employee agrees to so notify the Company
in writing within five (5) business days of Employee’s acceptance of such
employment, providing the name of such employer (or entity to whom Employee may
be providing consulting services), his intended duties as well as the
anticipated start date. Such information is required to ensure Employee’s
compliance with his non-compete obligations as well as all other applicable
restrictive covenants. This notice will also serve to trigger the Company’s
right to terminate all Company-paid or Company-provided benefits consistent with
the above paragraphs. Failure to timely provide such notice shall be deemed a
material breach of this Agreement entitling the Company to recover as damages
the value of all benefits provided to Employee hereunder plus attorneys fees.

3

--------------------------------------------------------------------------------

 

9.   Employee agrees to fully indemnify and hold the Company harmless for any
taxes, penalties, interest, cost or attorneys’ fee assessed against or incurred
by the Company on account of such benefits having been provided to him or based
on any alleged failure to withhold taxes or satisfy any claim obligation.
Employee understands and acknowledges that neither the Company, nor any of its
employees, attorneys, or other representatives has provided him with any legal
or financial advice concerning taxes or any other matter, and that he has not
relied on any such advice in deciding whether to enter into this Agreement. To
the extent applicable, Employee understands and agrees that he shall have the
responsibility for, and he agrees to pay, any and all appropriate income tax or
other tax obligations for which he is individually responsible and/or related to
receipt of any benefits provided in this Agreement not subject to federal
withholding obligations.

10.   In exchange for the foregoing Severance Benefits, PATRICK de MAYNADIER on
behalf of himself, his heirs, representatives, agents and assigns hereby
RELEASES, INDEMNIFIES, HOLDS HARMLESS, and FOREVER DISCHARGES (i) Hillenbrand
Industries, Inc., (ii) its parent, subsidiary or affiliated entities, (iii) all
of their present or former directors, officers, employees, shareholders, and
agents, as well as (iv) all predecessors, successors and assigns thereof from
any and all actions, charges, claims, demands, damages or liabilities of any
kind or character whatsoever, known or unknown, which Employee now has or may
have had through the effective date of this Agreement.

11.   Without limiting the generality of the foregoing release, it shall
include: (i) all claims or potential claims arising under any federal, state or
local laws relating to the Parties’ employment relationship, including any
claims Employee may have under the Civil Rights Acts of 1866 and 1964, as
amended, 42 U.S.C. Sections 1981 and 2000(e) et. seq.; the Civil Rights Act of
1991; the Age Discrimination in Employment Act, as amended, 29 U.S.C.
Sections 621 et seq.; the Americans with Disabilities Act of 1990, as amended,
42 U.S.C. Sections 12,101 et seq.; the Fair Labor Standards Act 29 U.S.C,
Sections 201 et seq.; the Worker Adjustment and Retraining Notification Act, 29
U.S.C. Sections 2101, et seq.; the Sarbanes-Oxley Act of 2002, specifically
including the Corporate and Criminal Fraud Accountability Act, 18 U.S.C. Section
1514A, et seq.; and any other federal, state or local law governing the Parties’
employment relationship; (ii) any claims on account of, arising out of or in any
way connected with Employee’s employment with the Company or leaving of that
employment; (iii) any claims alleged or which could have been alleged in any
charge or complaint against the Company; (iv) any claims relating to the conduct
of any employee, officer, director, agent or other representative of the
Company; (v) any claims of discrimination, harassment or retaliation on any
basis; (vi) any claims arising from any legal restrictions on an employer’s
right to separate its employees; (vii) any claims for personal injury,
compensatory or punitive damages or other forms of relief; and (viii) all other
causes of action sounding in contract, tort or other common law basis, including
(a) the breach of any alleged oral or written contract, (b) negligent or
intentional misrepresentations,

4

--------------------------------------------------------------------------------

 

    (c) wrongful discharge, (d) just cause dismissal, (e) defamation,
(f) interference with contract or business relationship or (g) negligent or
intentional infliction of emotional distress.   12.   Employee further agrees
and covenants not to sue the Company or any entity or individual subject to the
foregoing General Release with respect to any claims, demands, liabilities or
obligations release by this Agreement provided, however, that nothing contained
in this Agreement shall:

  (a)   prevent Employee from filing an administrative charge with the Equal
Employment Opportunity Commission or any other federal state or local agency; or
    (b)   prevent employee from challenging, under the Older Worker’s Benefit
Protection Act (29 U.S.C. § 626), the knowing and voluntary nature of his
release of any age claims in this Agreement in court or before the Equal
Employment Opportunity Commission. [INCLUDE THIS SUBPARAGRAPH (b) IF EMPLOYEE IS
AGE 40 OR OLDER]

13.   Notwithstanding his right to file an administrative charge with the EEOC
or any other federal, state, or local agency, Employee agrees that with his
release of claims in this Agreement, he has waived any right he may have to
recover monetary or other personal relief in any proceeding based in whole or in
part on claims released by him in this Agreement. For example, Employee waives
any right to monetary damages or reinstatement if an administrative charge is
brought against the Company whether by Employee, the EEOC, or any other person
or entity, including but not limited to any federal, state, or local agency.
Further, with his release of claims in this Agreement, Employee specifically
assigns to the Company his right to any recovery arising from any such
proceeding.

14.   [INCLUDE THIS LANGUAGE IF EMLOYEE IS AGE 40 OR OLDER] The Parties
acknowledge that it is their mutual and specific intent that the above waiver
fully complies with the requirements of the Older Workers Benefit Protection Act
(29 U.S.C. Section 626) and any similar law governing release of claims.
Accordingly, Employee hereby acknowledges that:

  (a)   He has carefully read and full understands all of the provision of this
Agreement and that he has entered into this Agreement knowingly and voluntarily;
    (b)   The Severance Benefits offered in exchange for Employee’s release of
claims exceed in kind and scope that to which he would have otherwise been
legally entitled absent the execution of this Agreement;     (c)   Prior to
signing this Agreement, Employee had been advised, and is being advised by this
Agreement, to consult with an attorney of his choice concerning its terms and
conditions; and

5

--------------------------------------------------------------------------------

 

  (d)   He has been offered at least [TWENTY-ONE (21)/FORTY-FIVE (45)] days
within which to review and consider this Agreement.

15.   [ADD THIS LANGUAGE IF EMPLOYEE IS AGE 40 OR OLDER] The Parties agree that
this Agreement shall not become effective and enforceable until the date this
Agreement is signed by both Parties or seven (7) calendar days after its
execution by Employee, whichever is later. Employee may revoke this Agreement
for any reason by providing written notice of such intent to the Company within
seven (7) days after he has signed this Agreement, thereby forfeiting Employee’s
right to receive any Severance Benefits provided hereunder and rendering this
Agreement null and void in its entirety.

16.   [ADD THIS LANGUAGE IF THE EMPLOYEE IS IN CALIFORNIA] Employee specifically
acknowledges that, as a condition of this Agreement, he expressly releases all
rights and claims that he knows about as well as those he may not know about.
Employee expressly waives all rights under Section 1542 of the Civil Code of the
State of California, which reads as follows:

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release which if
known, must have materially affected his settlement with the debtor.”

    Notwithstanding the provision by Section 1542, and for the purpose of
implementing a full and complete release and discharge of the Company as set
forth above, Employee expressly acknowledges that this Agreement is intended to
include and does in its effect, without limitation, include all claims which
Employee does not know or suspect to exist in his favor at the time of signing
this Agreement and that this Agreement expressly contemplates the extinguishment
of all such claims.   17.   The Parties agree that nothing contained herein
shall purport to waive or otherwise affect any of Employee’s rights or claims
that may arise after he signs this Agreement. It is further understood by the
Parties that nothing in this Agreement shall affect any rights Employee may have
under any Company sponsored Deferred Compensation Program, Executive Life
Insurance Bonus Plan, Stock Grant Award, Stock Option Grant, Restricted Stock
Unit Award, Pension Plan and/or Savings Plan (i.e., 401(k) plan) provided by the
Company as of the date of his termination, such items to be governed exclusively
by the terms of the applicable agreements or plan documents.

18.   Similarly, notwithstanding any provision contained herein to the contrary,
this Agreement shall not constitute a waiver or release or otherwise affect
Employee’s rights with respect to any vested benefits, any rights he has to
benefits which cannot be waived by law, any coverage provided under any
Directors and Officers (“D&O”) policy, any rights Employee may have under any
indemnification agreement he has with the Company prior to the date hereof, any
rights he has a s

6

--------------------------------------------------------------------------------

 

    a shareholder, or any claim for breach of this Agreement, including, but not
limited to the benefits promised by the terms of this Agreement.   19.  
[Optional Provisions for Equity Eligible Employees: Except as provided herein,
Employee acknowledges that he will not be eligible to receive or vest in any
additional stock options, stock awards or restricted stock units (“RSUs”) as of
his Effective Termination Date. Failure to exercise any vested options within
the applicable period as set for in the plan and/or grant will result in their
forfeiture. Employee acknowledges that any stock options, stock awards or RSUs
held for less than the required period shall be deemed forfeited as of the
effective date of this Agreement. All terms and conditions of such stock
options, stock awards or RSUs shall not be affected by this Agreement, shall
remain in full force and effect, and shall govern the Parties’ rights with
respect to such equity based awards.]   20.   [OPTION A] Employee acknowledges
that his termination and the Severance Benefits offered hereunder were based on
an individual determination and were not offered in conjunction with any group
termination or group severance program and waives any claim to the contrary.    
  [OPTION B] Employee represents and agrees that he has been provided relevant
cohort information based on the information available to the Company as of the
date this Agreement was tendered to Employee. This information is attached
hereto as Exhibit A. The Parties acknowledge that simply providing such
information does not mean and should not be interpreted to mean that the Company
was obligated to comply with 29 C.F.R. Section 1625.22(f).

21.   Employee hereby affirms and acknowledges his continued obligations to
comply with the post-termination covenants contained in his Employment
Agreement, including but not limited to, the non-complete, trade secret and
confidentiality provisions. Employee acknowledges that a copy of the Employment
Agreement has been attached to this Agreement as Exhibit A [B] or has otherwise
been provided to him and, to the extent not inconsistent with the terms of this
Agreement or applicable law, the terms thereof shall be incorporated herein by
reference. Employee acknowledges that the restrictions contained therein are
valid and reasonable in every respect and are necessary to protect the Company’s
legitimate business interests. Employee hereby affirmatively waives any claim or
defense to the contrary. Employee hereby acknowledges that the definition of
Competitor, as provided in his Employment Agreement shall include but not be
limited to those entities specifically identified in the update Competitor List,
attached hereto as Exhibit B[C].

22.   Employee acknowledges that the Company as well as its parent, subsidiary
and affiliated companies (“Companies” herein) possess, and he has been granted
access to, certain trade secrets as well as other confidential and proprietary
information that they have acquired at great effort and expense. Such
information includes, without limitation, confidential information regarding
products and

7

--------------------------------------------------------------------------------

 

    services, marketing strategies, business plans, operations, costs, current
or, prospective customer information (including customer contacts, requirements,
creditworthiness and like matters), product concepts, designs, prototypes or
specifications, regulatory compliance issues, research and development efforts,
technical data and know-how, sales information, including pricing and other
terms and conditions of sale, financial information, internal procedures,
techniques, forecasts, methods, trade information, trade secrets, software
programs, project requirements, inventions, trademarks, trade names, and similar
information regarding the Companies’ business (collectively referred to herein
as “Confidential Information”).   23.   Employee agrees that all such
Confidential Information is and shall remain the sole and exclusive property of
the Company. Except as may be expressly authorized by the Company in writing, or
as may be required by law after providing due notice thereof to the Company,
Employee agrees not to disclose, or cause any other person or entity to
disclosure, any Confidential Information to any third party for as long
thereafter as such information remains confidential (or as limited by applicable
law) and agrees not to make use of any such Confidential Information for
Employee’s own purposes or for the benefit of any other entity or person. The
Parties acknowledge that Confidential Information shall not include any
information that is otherwise made public through no fault of Employee or other
wrong doing.

24.   On or before Employee’s Effective Termination Date or per the Company’s
request, Employee agrees to return the original and all copies of all things in
his possession or control relating to the Company or its business, including but
not limited to any and all contracts, reports, memoranda, correspondence,
manuals, forms, records, designs, budgets, contact information or lists
(including customer, vendor or supplier lists), ledger sheets or other financial
information, drawings, plans (including, but not limited to, business, marketing
and strategic plans), personnel or other business files, computer hardware,
software, or access codes, door and file keys, identification, credit cards,
pager, phone, and any and all other physical, intellectual, or personal property
of any nature that he received, prepared, helped prepare, or directed
preparation of in connection with his employment with the Company. Nothing
contained herein shall be construed to require the return of any
non-confidential and de minimis items regarding Employee’s pay, benefits or
other rights of employment such as pay stubs, W-2 forms, 401(k) plan summaries,
benefit st atements, etc. including any legal forms developed by Employee during
the term of his employment may be used by him thereafter provided such items are
not used to compete against the Company.

25.   Employee hereby consents and authorizes the Company to deduct as an offset
from the above-referenced severance payments the value of any Company property
not returned or returned in a damaged condition as well as any monies paid by
the Company on Employee’s behalf (e.g., payment of any outstanding American
Express bill).

8

--------------------------------------------------------------------------------

 

26.   Employee agrees to cooperate with the Company in connection with any
pending or future litigation, proceeding or other matter which has been or may
be brought against or by the Company before any agency, court, or other tribunal
and concerning or relating in any way to any matter falling within Employee’s
knowledge or former area of responsibility. Employee agrees to immediately
notify the Company, through the Office of the General Counsel, in the event he
is contacted by any outside attorney (including paralegals or other affiliated
parties) concerning or relating in any way to any matter falling within
Employee’s knowledge or former area of responsibility unless (i) the Company is
represented by the attorney, (ii) Employee is represented by the attorney for
the purpose of protecting his personal interests or (iii) the Company has been
advised of and has approved such contact. Employee agrees to provide reasonable
assistance and completely truthful testimony in such matters including, without
limitation, facilitating and assisting in the preparation of any underlying
defense, responding to discovery requests, preparing for and attending
deposition(s) as well as appearing in court to provide truthful testimony. The
Company agrees to reimburse Employee for all reasonable out of pocket expenses
incurred at the request of the Company associate with such assistance and
testimony.

27.   Employee agrees not to make any written or oral statement that may defame,
disparage or cast in a negative light so as to do harm to the personal or
professional reputation of (a) the Company, (b) its employee, officers,
directors or trustees or (c) the services and/or product provided by the Company
and its subsidiaries or affiliate entities. Similarly, in response to any
written inquiry from any prospective employer or in connection with a written
inquiry in connection with any future business relationship involving Employee,
the Company agrees not to provide any information that may defame, disparage or
cast in a negative light so as to do harm to the personal or professional
reputation of Employee. The Parties acknowledge, however, that nothing contained
herein shall be construed to prevent or prohibit the Company or the Employee
from providing truthful information in response to any court order, discovery
request, subpoena or other lawful request.

28.   EMPLOYEE SPECIFICALLY AGREES AND UNDERSTANDS THAT THE EXISTENCE AND TERMS
OF THIS AGREEMENT ARE STRICTLY CONFIDENTIAL AND THAT SUCH CONFIDENTIALITY IS A
MATERIAL TERM OF THIS AGREEMENT. Accordingly, except as required by law or
unless authorized to do so by the Company in writing, Employee agrees that he
shall not communicate, display or otherwise reveal any of the contents of this
Agreement to anyone other than his spouse, legal counsel or financial advisor
provided, however, that they are first advised of the confidential nature of
this Agreement and Employee obtains their agreement to be bound by the same. The
Company agrees that Employee may respond to legitimate inquiries regarding the
termination of his employment by stating that the Parties have terminated their
relationship on an amicable basis and that the Parties have entered into a
Confidential Separation and Release Agreement that prohibits him from further
discussing the specifics of his separation, Nothing contained herein shall be

9

--------------------------------------------------------------------------------

 

    construed to prevent Employee from discussing or otherwise advising
subsequent employers of the existence of any obligations as set forth in his
Employment Agreement. Further, nothing contained herein shall be construed to
limit or otherwise restrict the Company’s ability to disclose the terms and
conditions of this Agreement as may be required by business necessity.   29.  
In the event that Employee breaches or threatens to breach any provision of this
Agreement, he agrees that the Company shall be entitled to seek any and all
equitable and legal relief provided by law, specifically including immediate and
permanent injunctive relief. Employee agrees that the Company shall be entitled
to discontinue providing any additional Severance Benefits upon such breach or
threatened breach as well as an award of all costs and attorneys’ fees incurred
by the Company in any successful effort to enforce the terms of this Agreement.
Employee agrees that the foregoing relief shall not be construed to limit or
otherwise restrict the Company’s ability to pursue any other remedy provided by
law, including the recovery of any actual, compensatory or punitive damages.
Moreover, if Employee pursues any claims against the Company subject to the
foregoing General Release, or breaches the above confidentiality provision,
Employee agrees to immediately reimburse the Company for the value of all
benefits received under this Agreement to the fullest extent permitted by law.

30.   Similarly, in the event that the Company breaches or threatens to breach
any provision of this Agreement, Employee shall be entitled to seek any and all
equitable or other available relief provided by law, specifically including
immediate and permanent injunctive relief. In the event Employee is required to
file suit to enforce the terms of this Agreement, the Company agrees that
Employee shall be entitled to an award of all costs and attorneys’ fees incurred
by him in any wholly successful effort (i.e. entry of a judgment in his favor)
to enforce the terms of this Agreement. In the event Employee is wholly
unsuccessful, the Company shall be entitled to an award of its costs and
attorneys’ fees.

31.   Both Parties acknowledge that this Agreement is entered into solely for
the purpose of terminating Employee’s employment relationship with the Company
on an amicable basis and shall not be construed as an admission of liability or
wrongdoing by the Company or Employee, both Parties having expressly denied any
such liability or wrongdoing.

32.   Each of the promises and obligations shall be binding upon and shall inure
to the benefit of the heirs, executors, administrators, assigns and successors
in interest of each of the Parties.

33.   The Parties agree that each and every paragraph, sentence, clause, term
and provision of this Agreement is severable and that, if any portion of this
Agreement should be deemed not enforceable for any reason, such portion shall be
stricken and the remaining portion or portions thereof should continue to be
enforced to the fullest extent permitted by applicable law.

10

--------------------------------------------------------------------------------

 

34.   This Agreement shall be governed by and interpreted in accordance with the
laws of the State of Indiana without regard to any applicable state’s choice of
law provisions.

35.   [USE THIS LANGUAGE IF OWBPA LANGUAGE (FOR EMPLOYEES AGE 40 OR OVER) IS NOT
INCLUDED] Employee acknowledges that he has been offered a period of twenty-one
(21) days within which to consider and review this Agreement; that he has
carefully read and fully understands all of the provisions of this Agreement;
and that he has entered into this Agreement knowingly and voluntarily.

36.   Employee represents and acknowledges that in signing this Agreement he
does not rely, and has not relied, upon any representation or statement made by
the Company or by any of the Company’s employees, officers, agents,
stockholders, directors or attorneys with regard to the subject matter, basis or
effect of this Agreement other than those specifically contained herein.

37.   This Agreement represents the entire agreement between the Parties
concerning the subject matter hereof, shall supersede any and all prior
agreements which may otherwise exist between them concerning the subject matter
hereof (specifically excluding, however, the post-termination obligations
contained in an Employee’s Employment Agreement, or any obligation contained in
any other legally-binding document), and shall not be altered, amended, modified
or otherwise changed except by a writing executed by both Parties.

PLEASE READ CAREFULLY. THIS SEPARATION AND RELEASE
AGREEMENT INCLUDES A COMPLETE RELEASE OF ALL
KNOWN AND UNKNOWN CLAIMS.
          IN WITNESS WHEREOF, the Parties have themselves signed, or caused a
duly authorized agent thereof to sign, this Agreement on their behalf and
thereby acknowledge their intent to be bound by its terms and conditions.

                          [EMPLOYEE]       HILLENBRAND INDUSTRIES, INC.        
        (to be renamed Hill-Rom Holdings, Inc.)    
 
                       
Signed:
          By:                                  
Printed:
              Title:        
 
                       
Dated:
              Dated:        
 
 
 
             
 
   

11

--------------------------------------------------------------------------------

 

EXHIBIT B
ILLUSTRATIVE COMPETTIOR LIST
     The following is an illustrative, non-exhaustive list of Competitors with
whom Employee may not, during his relevant non-compete period, directly or
indirectly engage in any of the competitive activities proscribed by the terms
of his Employment Agreement.

             
•
  Amico Corporation   •   Anodyne Medical Device, Inc.
 
           
•
  APEX Medical Corp.   •   Apria Healthcare Inc.
 
           
•
  Aramark Corporation   •   Ascom (Ascom US, Inc.)
 
           
•
  Barton Medical Corporation   •   B.G. Industries, Inc.
 
           
•
  CareMed Supply, Inc.   •   Comfortex, Inc.
 
           
•
  Corona Medical SAS   •   Custom Medical Solutions
 
           
•
  Dukane Communication Systems, a division of Edwards Systems Technology, Inc.  
•   Freedom Medical, Inc.
 
           
•
  Gaymar Holding Company, LLC (Gaymar Industries, Inc.)   •   GF Health
Products, Inc. (Graham Field)
 
           
•
  Getinge Group (Arjo; Getinge; Maquet; Pegasus; Huntleigh Technology Plc
(Huntleigh Healthcare, LLC))   •   Intego Systems, Inc. (formerly known as
Wescom Products, Inc.)
 
           
•
  Industrie Guido Malvestio S.P.A.   •   Invacare Corporation
 
           
•
  Joerns Healthcare, Inc.   •   Joh. Stiegelmeyer & Co., GmbH (Stiegelmeyer)
 
           
•
  Kinetic Concepts, Inc. (KCI)   •   Linet (Linet France, Linet Far East)
 
           
•
  MedaSTAT, LLC   •   Medline Industries, Inc.
 
           
•
  Merivaara Corporation   •   Modular Services Company
 
           
•
  Nemschoff Chairs, Inc.   •   Nurture by Steelcase, Inc.
 
           
•
  Paramount Bed Company, Ltd.   •   Pardo
 
           
•
  Pegasus Airwave, Inc.   •   Premise Corporation
 
           
•
  Radianse, Inc.   •   Rauland-Borg Corporation
 
           
•
  Recovercare, LLC (Stenbar)   •   SIZEwise Rentals, LLC
 
           
•
  Statcom (Jackson Healthcare Solutions)   •   Stryker Corporation

 

--------------------------------------------------------------------------------

 

             
•
  Tele-Tracking Technologies, Inc.   •   Tempur-Pedic Medical, Inc.
 
           
•
  Universal Hospital Services, Inc.   •   Voelker AG

     While the above list is intended to identify the Company’s primary
competitors, it should not be construed as all encompassing so as to exclude
other potential competitors falling within the Non-Compete definitions of
“Competitor.” The Company reserves the right to amend this list at any time in
its sole discretion to identify other or additional Competitors based on changes
in the products and services offered, changes in its business or industry as
well as changes in the duties and responsibilities of the individual employee.
An updated list will be provided to Employee upon reasonable request. Employees
are encouraged to consult with the Company prior to accepting any position with
any potential competitor.
(Revised list 1-1-2008)

2

--------------------------------------------------------------------------------

 

Exhibit C
BATESVILLE CASKET CO. ILLUSTRATIVE COMPETITOR LIST
     The following is an illustrative, non-exhaustive list of Competitors with
whom Employee may not, during his relevant non-compete period, directly or
indirectly engage in any of the competitive activities proscribed by the terms
of his Employment Agreement.

             
•
  Astral Industries, Inc.   •   Aurora Casket Company, Inc.
 
           
•
  Goliath Casket, Inc.   •   Milso Industries, Inc.
 
           
•
  Milso Industries, LLC   •   New England Casket Company
 
           
•
  R and S Marble Designs   •   Reynoldsville Casket Company
 
           
•
  Schuykill Haven Casket Company, Inc. (A division of The Haven Line Industries)
  •   SinoSource International, Inc.
 
           
•
  Thacker Caskets, Inc.   •   The York Group (a division of Matthews
International Corp.) and its distributors, including Warfield Rohr, Artco,
Newmark and AJ Distribution
 
           
•
  The Victoriaville Group   •   Wilbert Funeral Services, Inc.

     While the above list is intended to identify the Company’s primary
competitors, it should not be construed as all encompassing so as to exclude
other potential competitors falling within the Non-Compete definitions of
“Competitor.” The Company reserves the right to amend this list at any time in
its sole discretion to identify other or additional Competitors based on changes
in the products and services offered, changes in its business or industry as
well as changes in the duties and responsibilities of the individual employee.
An updated list will be provided to Employee upon reasonable request.

 

--------------------------------------------------------------------------------

 

Employees are encouraged to consult with the Company prior to accepting any
position with any potential competitor.
(Revised list 12-10-2007)

2