Exhibit 10.2
KIMBALL INTERNATIONAL, INC.
PERFORMANCE UNIT AWARD AGREEMENT
FISCAL YEAR 2018
THIS PERFORMANCE UNIT AWARD AGREEMENT (“Award Agreement”), dated the
               day of               , 20     (“Award Date”), is granted by
KIMBALL INTERNATIONAL, INC., an Indiana corporation (“Company”), to
                                         (“Employee”) pursuant to the terms of
the Company’s Amended and Restated 2003 Stock Option and Incentive Plan
(“Plan”).
WHEREAS, the Board of Directors and the Compensation and Governance Committee of
the Company (“Committee”) believe it to be in the best interests of the Company
and its share owners for its officers and other key employees to obtain or
increase their stock ownership interest in the Company in order that they will
have a greater incentive to work for and manage the Company’s affairs in such a
way that its shares may become more valuable, thereby aligning the personal
interests of officers and key employees with those of the Company’s share
owners; and
WHEREAS, the Employee is employed by the Company or one of its subsidiaries as
an officer or key employee;
NOW THEREFORE, in consideration of these premises and of services to be
performed by the Employee, the Company hereby grants this Performance Unit Award
to the Employee on the terms and conditions hereinafter expressed and subject to
the terms of the Plan.
1.
GRANT OF PERFORMANCE UNITS

The Company hereby grants to the Employee a total of            (    )
Performance Units under this Award Agreement, subject to the terms and
conditions set forth in this Award Agreement and the Plan (“Award”). Each
Performance Unit represents the right to receive one (1) share (a “Share”) of
Common Stock of the Company, subject to the eligibility, performance and other
terms and conditions set forth in this Award Agreement and the Plan. The number
of Performance Units granted above will function as a target (the “Target”),
with the number of actual Performance Units, if any, ultimately earned under
this Award Agreement to be determined in accordance with the terms of this Award
Agreement and the Plan.
2.
PERFORMANCE CYCLE

For purposes of this Award, the “Performance Cycle” is the 36-month period
commencing                         , 20     and ending                         ,
20    .
3.
SATISFACTION OF PERFORMANCE-BASED CONDITIONS

Subject to the eligibility conditions described in Section 4 of this Award
Agreement, and the satisfaction of the performance conditions set forth in
Section 5 of this Award Agreement, the Company intends to award Shares hereunder
to the Employee as soon as administratively practical following the end of the
Performance Cycle, but in no event later than sixty (60) days following the end
of the Performance Cycle. Except as set forth in Section 4.C.(ii) and Section 7
of this Award Agreement, no Shares in settlement of the Performance Units shall
be issued to the Employee prior to the end of the Performance Cycle.

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4.
ELIGIBILITY CONDITIONS

A.
As soon as practical following the end of the Performance Cycle, the Committee
shall determine whether and the extent to which the performance conditions set
forth in Section 5 of this Award Agreement have been satisfied and the number of
Performance Units, if any, earned by the Employee (the date of such
determination by the Committee hereinafter referred to as the “Determination
Date”), provided, however, that to receive Shares in settlement of the
Performance Units determined by the Committee to have been earned, the Employee
must have remained in Continuous Service from the date hereof through the last
day of the Performance Cycle (the “Settlement Date”), except as provided in
subsection (C) below.

B.
If the Employee ceases Continuous Service before the end of the Performance
Cycle for any reason other than Disability, death or Retirement, the Employee
will forfeit all rights with respect to any Performance Units under this Award
Agreement.

C.
Disability, Death or Retirement.

(i)
If the Employee ceases Continuous Service before the end of the Performance
Cycle by reason of Disability or Retirement, the number of Performance Units to
which Employee may be entitled under this Award Agreement, if any, will be
determined on the Determination Date based on the Company’s performance through
the last day of the Performance Cycle, but shall be prorated to reflect the
portion of the Performance Cycle that the Employee worked prior to such
Disability or Retirement. Except as provided in Section 15 below, the Shares
corresponding to such earned Performance Units shall be paid within sixty (60)
days following the end of the Performance Cycle.

a.
To be considered a Retirement under this Award Agreement, the Employee must have
incurred a Separation of Service, as defined in Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”). “Separation from Service” shall
mean a “separation from service” within the meaning of Code Section
409A(a)(2)(A)(i) and Treasury regulation section 1.409A-1(h) and shall mean with
respect to an Employee, the complete termination of the employment relationship
between the Employee and the Company and/or all affiliated employers within the
meaning of Code Section 414(b) or (c), for any reason other than death.

b.
Performance Units will be prorated by multiplying the Performance Units
determined to be earned for the Performance Cycle by a fraction determined by:

•
Numerator = number of months during the Performance Cycle that the Employee
maintained Continuous Service prior to such Disability or Retirement, including
the month in which the Continuous Service ceases, which shall be considered a
full month.

•
Denominator = 36 months.

(ii)
If the Employee ceases Continuous Service before the end of the Performance
Cycle by reason of the Employee’s death, the Performance Cycle for purposes of

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this Award Agreement shall be treated as ending on the date of the Employee’s
death. In the event of the Employee’s death, the number of Performance Units
earned by the Employee shall equal the Target number of Performance Units, pro
rated to reflect the portion of the Performance Cycle, as set forth in Section
2, that the Employee worked prior to his/her death, using the fraction described
in (i)(b) above. Except as provided in Section 15 below, the Shares
corresponding to such earned Performance Units shall be paid within thirty (30)
days following the date of the Employee’s death.
D.
Notwithstanding anything to the contrary set forth in the Plan or this Award
Agreement, the Employee shall forfeit any Performance Units awarded hereunder in
the event that:

(i)
The Employee is discharged by the Company from his or her employment with the
Company for Cause. For purposes herein, “Cause” shall mean, with respect to
termination of the Employee’s employment with the Company, one or more of the
following occurrences: (1) Employee’s willful and continued failure to perform
substantially the duties of Employee’s position or to follow lawful instructions
of a senior executive or the Board of Directors, if such failure continues for a
period of five days after the Company delivers to Employee a written notice
identifying such failure; (2) Employee’s conviction of a felony or of another
crime that reflects adversely on the Company; or (3) Employee’s engaging in
fraudulent or dishonest conduct, gross misconduct that is injurious to the
Company, or any misconduct that involves moral turpitude; or

(ii)
The Employee breaches any of his or her employee and ancillary agreements,
including without limitation, any confidentiality or non-solicitation obligation
documented by agreement (collectively, “Employee Agreement”). In addition, for
purposes herein, an Employee shall be deemed to have breached an Employee
Agreement if the Employee seeks judicial intervention to limit or nullify the
terms of such agreement.

E.
In the event that Performance Units are earned by, and Shares are paid to, the
Employee under this Award Agreement and within twelve (12) months after the
payment of such Shares to the Employee, (a) the Company identifies facts that
result in, or, in the event of payment of such Shares as a result of Retirement
or Disability, would have resulted in, a termination for Cause, or (b) the
Employee breaches an Employee Agreement, then, in addition to the forfeiture
under Section 4.D. of this Award Agreement, the Employee agrees to repay the
value of such Shares received under this Award Agreement within thirty (30) days
of the date of written demand by the Company (“Clawback Amount”).

F.
Awards and any compensation or benefits associated therewith shall also be
subject to repayment or forfeiture as may be required to comply with (i) any
applicable listing standards of a national securities exchange adopted in
accordance with Section 10D of the Exchange Act (regarding recovery of
erroneously awarded compensation) and any implementing rules and regulations of
the U.S. Securities and Exchange Commission adopted thereunder; (ii) similar
rules under the laws of any other jurisdiction; and (iii) any policies adopted
by the Company to implement such requirements, all to the extent determined by
the Company in its discretion to be applicable to a Participant. This Award
Agreement may be unilaterally amended by the Committee to comply with any such
compensation recovery policy.

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5.
PERFORMANCE CONDITIONS - DETERMINATION OF TOTAL NUMBER OF PERFORMANCE UNITS
EARNED AND VESTED

A.
Subject to the eligibility conditions in Section 4 of this Award Agreement,
after completion of the Performance Cycle, the total number of Performance Units
determined to be earned will be based entirely on the Company’s Relative Total
Shareholder Return (“Relative TSR”), as determined in this Section 5.A., as of
the last day of the Performance Cycle. For purposes of this Award, Total
Shareholder Return (“TSR”) shall be expressed as a compound annual growth rate
as calculated in the following example, with the ##-month period representing
the number of months of the award:

TSR =
(
Ending stock price + dividends paid
)
12
##
– 1
Beginning stock price
 

(i)
“Beginning Stock Price” shall mean the average closing price as reported on the
Nasdaq National Market (or such other principal exchange on which the Company’s
Common Stock is then listed for trading), of one (1) Share of the Company’s
Common Stock for the thirty (30) trading days immediately prior to the first day
of the Performance Cycle. Should the Company enter into a stock split or reverse
stock split during the Performance Cycle, the Beginning Stock Price will be
equitably adjusted in the calculation to address this change in shares
outstanding.

(ii)
“Ending Stock Price” shall mean the average closing price as reported on the
Nasdaq National Market (or such other principal exchange on which the Company’s
Common Stock is then listed for trading) of one (1) Share of the Company’s
Common Stock for the last thirty (30) trading days of the Performance Cycle.

(iii)
“Dividends Paid” shall include all dividends declared, with an ex-dividend date
within the Performance Cycle, if any, with respect to the Shares underlying the
Performance Units that are the subject of this Award Agreement.

B.
To determine Relative TSR, a peer group of companies approved by the Committee
will be used. The peer group shall consist of those companies set forth on
Exhibit 1 to this Award Agreement. If any company in the then-applicable peer
group declares bankruptcy, the company shall remain in the peer group. However,
if a company in the peer group undergoes a corporate transaction or other
reorganization, such as a spin, split, or delisting, that company shall be
removed from the beginning and ending calculations.

C.
Each peer group company’s TSR expressed as a compound annual growth rate
(“CAGR”) will be determined at the end of the Performance Cycle. The 80th, 50th
and 30th percentile TSRs of the peer group will then be computed to determine
the Performance Unit Payout as a Percent of Target in accordance with the
following chart. The TSR for companies included in the peer group shall be
calculated using the same formula as for the Company, but using each peer group
company’s own stock prices and dividends.

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Relative TSR
Performance Unit Payout as a Percent of Target
80th Percentile and above
200%
50th Percentile
100%
30th Percentile
50%
Less than 30th Percentile
0%

For any Relative TSR between the 80th and 50th percentiles, or between the 50th
and 30th percentiles, the payout percentage of the Target shall be interpolated.
Notwithstanding any other provision of this Award Agreement and in accordance
with the terms of the Plan, the maximum aggregate payout under this Award
Agreement shall not exceed 200% of the Target.
Example: An Employee is granted a target of 10 Performance Units for a
Performance Cycle. If the Company’s Relative TSR for the Performance Cycle
positions the Company at the 65th Percentile of the peer group, the Employee
would be entitled to receive 15 Shares (based on interpolating from the chart to
a 150% Award payout).
Notwithstanding the provisions and chart above for determination of the
Performance Unit payout percentage, if the Company’s TSR for the Performance
Cycle is less than zero, the payout as a percentage of the Target shall not
exceed 100%.
6.
SETTLEMENT OF THE AWARD AND DELIVERY OF SHARES

The number of earned Performance Units shall be determined by multiplying the
number of Performance Units granted in Section 1 of this Award Agreement by the
applicable percentage from the chart in Section 5 of this Award Agreement
corresponding to the Company’s Relative TSR for the Performance Cycle. Earned
Performance Units shall be paid in Shares, as soon as administratively
practicable after the Determination Date but in no event more than sixty (60)
days following the last day of the Performance Cycle. In determining the number
of Shares to be paid to the Employee, the Shares will be rounded down to the
number of full shares, excluding any fractional shares.
7.
CHANGE IN CONTROL

Notwithstanding the foregoing provisions of this Award Agreement, in the event
of a Change in Control during the Performance Cycle, the Performance Cycle for
purposes of this Award Agreement shall be treated as ending on the earlier of
the last date of the original Performance Cycle in Section 2 of this Award
Agreement or the effective date of the Change in Control. In the event of a
Change in Control, the number of Performance Units earned by the Employee shall
equal the Target number of Performance Units, pro rated to reflect the portion
of the Performance Cycle, as set forth in Section 2, that the Employee worked
prior to the effective date of such Change in Control. Except as provided in
Section 15 below, the Shares corresponding to such earned Performance Units
shall be paid within thirty (30) days following the effective date of the Change
in Control.
For purposes herein, “Change in Control” means the consummation of any of the
following that is not an Excluded Transaction: (i) the acquisition, by any one
person or more than one person acting as a Group, of Majority Ownership of a
Relevant Company through merger, consolidation, or stock transfer;

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(ii) the acquisition during any 12-month period, by any one person or more than
one person acting as a Group, of ownership interests in a Relevant Company
possessing 35 percent or more of the total voting power of all ownership
interests in the Relevant Company; (iii) the acquisition of ownership during any
12-month period, by any one person or more than one person acting as a Group, of
40 percent or more of the total gross fair market value of the assets of a
Relevant Company; or (iv) the replacement of a majority of members of the Board
of Directors during any 12-month period, by members whose appointment or
election is not endorsed by a majority of the members of the Board of Directors
prior to the date of the appointment or election. For purposes of this
definition, “Relevant Company” means, with respect to Employee, Kimball
International, Inc., any Affiliate that employs Employee, any entity that has
Majority Ownership of either Kimball International, Inc. or that Affiliate, or
any entity in an uninterrupted chain of Majority Ownership culminating in the
ownership of Kimball International, Inc. or that Affiliate; “Excluded
Transaction” means any occurrence that does not constitute a change of ownership
or control for purposes of Code Section 162(m) and its interpretive regulations
and does not constitute a change in the ownership or effective control, or in
the ownership of a substantial portion of the assets of, a Relevant Company
within the meaning of Code Section 409A(a)(2)(A)(v) and its interpretive
regulations; “Majority Ownership” of an entity means ownership interests
representing more than fifty percent (50%) of the total fair market value or of
the total voting power of all ownership interests in the entity; “Group” has the
meaning provided in Code Section 409A and its interpretive regulations with
respect to changes in ownership, effective control, and ownership of assets; and
an individual who owns a vested option to purchase either stock or another
ownership interest is deemed to own that stock or other ownership interest.
8.
SHARE CHANGES

If the Company shall at any time change the number of shares of its Common Stock
without new consideration to the Company (such as by stock dividend or stock
split), the total number of shares subject to the Award Agreement hereunder
shall be changed in proportion to the change in issued shares. If during the
term of this Award Agreement the Common Stock of the Company shall be changed
into another kind of securities of the Company or into cash, securities or
evidences of indebtedness of another corporation, other property or any
combination thereof, whether as a result of reorganization, sale, merger,
consolidation, or other similar transaction, the Company shall cause adequate
provision to be made whereby the Employee shall thereafter be entitled to
receive under this Award Agreement, the cash, securities, evidences of
indebtedness, other property or any combination thereof, the Employee would have
been entitled to receive for Common Stock acquired through this Award Agreement
immediately prior to the effective date of such transaction. If appropriate, the
number of shares of this Award Agreement following such reorganization, sale,
merger, consolidation or other similar transaction may be adjusted, in each case
in such equitable manner as the Committee may select.
9.
TRANSFER

Neither this Award nor any right or interest of the Employee in any Award under
the Plan may be assigned, encumbered or transferred otherwise than by will or
the laws of descent and distribution.
10.
VOTING RIGHTS AND DIVIDENDS

The Employee will not have any voting rights with respect to the Performance
Units and shall not be entitled to receive any Dividends Paid or dividends
declared with respect to the Performance Units subject to this Award Agreement.
The Employee will obtain voting rights and become entitled to receive any
dividends only after any earned Shares are transferred to the Employee.

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11.
TAXES AND WITHHOLDING

Issuance of the Award under this Award Agreement, under current applicable laws,
will result in various federal and/or state taxes becoming due, including, but
not limited to, income and social security. The Employee is responsible for the
timely payment of these taxes, and provision will be made by the Company to
satisfy these obligations by withholding of Shares equal in value to the minimum
amount of federal, state and local taxes required by the taxing authorities. The
value of the Shares withheld will be determined by using the appropriate method
under applicable tax regulations.
12.
ADMINISTRATION

This Award Agreement and your rights under it are subject to all terms and
conditions of the Plan, as the same may be amended from time to time, as well as
to such rules and regulations as the Committee may adopt for administration of
the Plan. The parties acknowledge that the Committee or its designee is
authorized to administer, construe and make all determinations necessary or
appropriate to the administration of the Plan and this Award Agreement, in its
sole discretion, all of which shall be binding on the Employee.
13.
AMENDMENTS

In the event any new modifications or changes are made to existing laws that
render any or all of this Award Agreement illegal or unenforceable, this Award
Agreement may be amended to the extent necessary in order to carry out the
intention of the Award to the Employee. The Committee may amend this Award
Agreement in other respects, without the Employee’s consent, if the amendment
will not have an adverse effect on the Employee’s rights under this Award
Agreement as in effect immediately before the amendment.
14.
RESTRICTIONS ON SHARES

There will be no restrictions on the Shares of Common Stock paid to the Employee
under this Award Agreement.
15.
CODE SECTION 409A

A.
The parties intend that the payments and benefits under the Plan and this Award
Agreement comply with Code Section 409A, to the extent applicable, and
accordingly, to the maximum extent permitted, the Plan and this Award Agreement
shall be interpreted and administered to be in compliance therewith. Any
payments described in this Award Agreement or the Plan that are due within the
“short-term deferral period” as defined in Code Section 409A shall not be
treated as deferred compensation unless applicable law requires otherwise.

B.
Notwithstanding any provisions in the Plan to the contrary, to the extent that
the Company has any stock which is publicly traded on an established securities
market or otherwise, if the Employee is a Specified Employee and a Separation
from Service occurs, any payment of deferred compensation, within the meaning of
Code Section 409A, otherwise payable under this Award Agreement because of
employment termination will be suspended until, and will be paid to the Employee
on, the first day of the seventh month following the month in which Separation
from Service occurs. Payments delayed by the preceding sentence shall be
accumulated and paid on the earliest administratively feasible date permitted by
such sentence. “Specified

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Employee” shall mean an individual who, at the time of his or her Separation
from Service, is a “specified employee” within the meaning of Code Section
409A(a)(2)(B)(i) and Treasury regulation section 1.409A-1(i). For purposes of
the preceding sentence, the “specified employee identification date” shall be
December 31 (of the prior Plan year) and the “specified employee effective date”
shall be the following April 1.
16.
PLAN CONTROLLING

The Award is subject to all of the terms and conditions of the Plan except to
the extent that those terms and conditions are supplemented or modified by this
Award Agreement, as authorized by the Plan. Capitalized terms used in this Award
Agreement and not otherwise defined herein shall have the meanings assigned to
them in the Plan. All determinations and interpretations of the Committee shall
be binding and conclusive upon the Employee and his or her legal
representatives.
17.
QUALIFICATION OF RIGHTS

Neither this Award Agreement nor the existence of the Award shall be construed
as giving the Employee any right (a) to be retained as an employee of the
Company; or (b) as a shareholder with respect to the Shares of Common Stock
earned pursuant to the Award until certificates for the Common Stock have been
issued and delivered to the Employee or a book entry has been recorded in the
name of the Employee with the Company’s transfer agent.
18.
GOVERNING LAW

This Award Agreement shall be governed by and construed in accordance with the
laws of the State of Indiana, excluding any conflicts or choice of law rule or
principle that might otherwise refer construction or interpretation of this
Award Agreement to the substantive law of another jurisdiction. Any action or
proceeding seeking to enforce the terms of this Award Agreement or based on any
right arising out of this Award Agreement must be brought in the appropriate
court located in Dubois County, Indiana, or if jurisdiction will so permit, in
the Federal District Court for the Southern District of Indiana located in
Evansville, Indiana. The parties hereto consent to the jurisdiction and venue of
said courts.
19.
REPRESENTATIONS AND WARRANTIES

A.
The Employee represents and warrants that he or she has received and reviewed a
Plan Memorandum, which summarizes the provisions of the Plan.

B.
The Company makes no representations or warranties as to the tax consequences of
and benefits vested or payable under this Award, and in no event shall the
Company be responsible or liable for any taxes, penalties or interest assessed
against the Employee for any benefit or payment provided under this Award.

C.
The Employee represents and warrants his/her understanding that the grant of the
Performance Units by the Company is voluntary and does not create in the
Employee any contractual or other right to receive future grants of Performance
Units, or benefits in lieu of Performance Units in any circumstance. All
decisions with respect to any future awards will be made in the sole discretion
of the Company.

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20.
SUCCESSORS AND ASSIGNS

This Award Agreement shall be binding upon and inure to the benefit of the
successors, assigns and heirs of the respective parties.
21.
WAIVER

The failure of a party to insist upon strict adherence to any term of this Award
Agreement on any occasion shall not be considered a waiver thereof or deprive
that party of the right thereafter to insist upon strict adherence to that term
or any other term of this Award Agreement.
22.
TITLES

Titles are provided herein for convenience only and are not to serve as a basis
for interpretation or construction of this Award Agreement.
23.    COUNTERPARTS/ COPIES
This Award Agreement may be signed in one or more counterparts, each of which
will be deemed to be an original and all of which when taken together will
constitute the same agreement. Any copy of this Award Agreement made by reliable
means (for example, photocopy, scanned copy or facsimile), is considered an
original.
IN WITNESS WHEREOF, the Company has caused the execution hereof by its duly
authorized officer and Employee has agreed to the terms and conditions of this
Award Agreement, all as of the day and date first above written.

Kimball International, Inc.

By:                                                   
[Name]
[Title]
Kimball International, Inc.
The undersigned employee has read, acknowledged and accepts the terms of the
Award, the Award Agreement, and the Plan.

                                                  
Employee Signature

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Exhibit 1
Peer Group Companies

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