exhibit1025replacemen_image2.jpg [exhibit1025replacemen_image2.jpg]

Exhibit 10.25

Elanco Animal Health Incorporated
Replacement Restricted Stock Unit Award Agreement

This Replacement Restricted Stock Unit Award has been granted on [insert grant
date] (“Grant Date”) by Elanco Animal Health Incorporated, an Indiana
corporation (“Elanco” or the “Company”), to the Eligible Individual who has
received this Replacement Restricted Stock Unit Award Agreement (the “Grantee”).

Number of Shares:     Log into UBS account at
http://equity.elancodirect.com

Grantee:     

Vesting Date(s):
[INSERT VESTING SCHEDULE AND PERCENTAGES (E.G.:

50% on 1st Anniversary of Grant Date
50% on 2nd Anniversary of Grant Date]
(except as otherwise provided in this Restricted Stock Unit Award Agreement)

Table of Contents

Section 1.Grant of Replacement Restricted Stock Units    3
Section 2.Vesting    3
Section 3.Change in Control    4
Section 4.Settlement    5
Section 5.Rights of the Grantee    5
Section 6.Prohibition Against Transfer    6
Section 7.Responsibility for Taxes    6
Section 8.Section 409A Compliance    7
Section 9.Nature of Grant    7
Section 10.Data Privacy    9
Section 11.Additional Terms and Conditions    11
Section 12.Governing Law and Choice of Venue    11
Section 13.Miscellaneous Provisions    12
Section 14.Award Subject to Acknowledgement of Acceptance    12

Section 1.
Grant of Replacement Restricted Stock Units

Elanco, an Indiana corporation (“Elanco” or the “Company”), has granted to the
Eligible Individual who has received this Replacement Restricted Stock Unit
Award Agreement (the “Grantee”) an award of restricted stock units (the
“Restricted Stock Units” or the “Award”) with respect to the number of shares of
Elanco Common Stock (the “Shares”) referenced on page 1 of this document,
pursuant to and subject to the terms and conditions set forth in the 2018 Elanco
Stock Plan (the “Plan”) and to the terms and conditions set forth in this
Restricted Stock Unit Award Agreement, including any appendices, exhibits and
addenda hereto (the “Award Agreement”). The Award is granted as a replacement
for the restricted stock unit or SVA award granted by Eli Lilly & Company
("Lilly") to the Grantee over Lilly shares of common stock that will be
forfeited upon the completion of the spin-off of the Company from Lilly. Unless
otherwise stated in the Plan where the terms in this Award Agreement may govern
in the event of any conflict between the terms of the Plan and this Award
Agreement, in the event of any such conflict, the terms of the Plan shall
otherwise govern.
Any capitalized terms used but not defined in this Award Agreement shall have
the meanings set forth in the Plan.

Section 2.
Vesting

a.
The Award shall vest as to all or a portion of the Award at the close of
business in Greenfield, Indiana, U.S.A. on the earliest of the following dates
(each, a “Vesting Date”):

i.
the Vesting Date(s) set forth on page 1 of this document;

ii.
a Qualifying Termination, as defined below.     

b.
In the event the Grantee's Service is terminated due to the Grantee's death, any
unvested portion of the Award will accelerate and vest in full.

c.
In the event the Grantee’s Service is terminated due to a Qualifying Termination
for a reason other than death, a pro-rata portion of the Award will accelerate
and vest based on the ratio of (x) the number of full or partial months worked
by the Grantee from the Grant Date to the Qualifying Termination to (y) the
total number of months from the Grant Date to the next scheduled Vesting Date
set forth on page 1 of this document.

d.
In the event the Grantee’s Service is terminated prior to a Vesting Date for any
reason or in any circumstance other than those specified in Section 2(a), 2(b)
or 2(c) above, any unvested portion of the Award shall be forfeited.

e.
For purposes of this Award Agreement, a "Qualifying Termination" means any one
of the following:

i.
retirement as a “retiree,” which is a person who is or was qualified as a
retired employee under the Lilly Company Retirement Plan (as in effect on the
Grant Date);

ii.
the date the Grantee’s Service is terminated due to the Grantee’s death;

iii.
the date the Grantee’s Service is terminated by reason of Disability;

iv.
the date the Grantee’s Service is terminated due to a closing of a plant site or
other corporate location;

v.
the date the Grantee's Service is terminated due to the elimination of a work
group, functional or business unit or other broadly applicable reduction in job
positions; or

vi.
the date the Grantee’s Service is terminated as a result of the Grantee’s
failure to locate a position within the Company or an Affiliate following the
placement of the Grantee on reallocation or medical reassignment in the United
States.

The Committee, in its sole discretion, shall determine whether and when a
Qualifying Termination has occurred and/or if a leave of absence or transfer of
employment between the Company and an Affiliate or between Affiliates
constitutes a termination of Service. Such determination shall be final and
binding on the Grantee.

Section 3.
Change in Control

The provisions of Section 13.2 of the Plan apply to this Award with the
following modifications:
a.
The only Change in Control event that shall result in a benefit under this
Section 3 shall be the consummation of a merger, share exchange, or
consolidation of the Company, as defined in Section 2.6(c) of the Plan (a
“Transaction”).

b.
In the event that the Award is not converted, assumed, substituted, continued or
replaced by a successor or surviving corporation, or a parent or subsidiary
thereof, in connection with a Transaction, then immediately prior to the
Transaction, the Award shall vest automatically in full.

c.
In the event that the Award is converted, assumed, substituted, continued or
replaced by a successor or surviving corporation, or a parent or subsidiary
thereof, in connection with a Transaction and the Grantee is subject to a
Covered Termination (as defined below) prior to any applicable Vesting Date, the
Award shall vest automatically in full.

For purposes of this provision, “Covered Termination” shall mean a Qualifying
Termination, Grantee’s termination without Cause or the Grantee’s resignation
for Good Reason. “Cause” and “Good Reason” shall have the meanings ascribed to
them in the Elanco Animal Health, Inc. 2018 Change in Control Severance Pay Plan
for Employees or the Elanco Animal Health, Inc. 2018 Change in Control Severance
Pay Plan for Select Employees (both as amended from time to time) or any
successor plan or arrangement thereto, as applicable.
d.
If the Grantee is entitled to receive stock of the acquiring entity or successor
to the Company as a result of the application of this Section 3, then references
to Shares in this Award Agreement shall be read to mean stock of the successor
or surviving corporation, or a parent or subsidiary thereof, as and when
applicable.

Section 4.
Settlement

a.
Except as provided below, the Award shall be paid to the Grantee as soon as
practicable, and in no event later than sixty days, following the applicable
Vesting Date, or, if earlier, a vesting event contemplated under Section 3
above.

b.
If the Award is considered an item of non-qualified deferred compensation
subject to Section 409A of the Code (“NQ Deferred Compensation”) and the
settlement date or period is on or by reference to the date of the termination
of the Grantee’s Service, (i) the Award shall not be paid unless and until the
Grantee experiences a “separation from service” within the meaning of Section
409A of the Code (a “Section 409A Separation”) and (ii) if the Grantee is a
“specified employee” within the meaning of Section 409A of the Code as of the
date of the Grantee’s Section 409A Separation, the vested portion of the Award
shall instead be paid on the earliest of (1) the Vesting Dates set forth in
Section 2(a)(i) with respect to the portion of the Award that was scheduled to
vest on such Vesting Dates, (2) the first day following the six (6) month
anniversary of the Grantee’s Section 409A Separation, (3) the date of a Section
409A CIC, and (4) the date of the Grantee’s death. If the Award is considered NQ
Deferred Compensation and the vesting event is a Transaction that does not
constitute a “change in control event” within the meaning of Section 409A of the
Code (a “Section 409A CIC”), the Award shall instead be settled on the earliest
of (A) the Vesting Dates set forth in Section 2(a)(i) with respect to the
portion of the Award that was scheduled to vest on such Vesting Dates, (B) the
date of a Section 409A CIC, and (C) the date of the Grantee’s death.

c.
At such time, the Company shall issue or transfer Shares or the cash equivalent,
as contemplated under Section 4(d) below, to the Grantee. In the event the
Grantee is entitled to a fractional Share, the fraction may be paid in cash or
rounded, in the Committee’s discretion.

d.
At any time prior to the applicable Vesting Date or until the Award is paid in
accordance with this Section 4, the Committee may, if it so elects, determine to
pay part or all of the Award in cash in lieu of issuing or transferring Shares.
The amount of cash shall be based on the Fair Market Value of the Shares on the
applicable Vesting Date.

e.
In the event of the death of the Grantee, the payments described above shall be
made to the successor of the Grantee.

Section 5.
Rights of the Grantee

a.
No Shareholder Rights. The Restricted Stock Units do not entitle the Grantee to
any rights of a shareholder of the Company until such time as the Restricted
Stock Units vest and Shares are issued or transferred to the Grantee.

b.
No Trust; Grantee’s Rights Unsecured. Neither this Award Agreement nor any
action in accordance with this Award Agreement shall be construed to create a
trust of any kind. The right of the Grantee to receive payments of cash or
Shares pursuant to this Award Agreement shall be an unsecured claim against the
general assets of the Company.

Section 6.
Prohibition Against Transfer

The right of a Grantee to receive payments of Shares and/or cash under this
Award may not be transferred except to a duly appointed guardian of the estate
of the Grantee or to a successor of the Grantee by will or the applicable laws
of descent and distribution and then only subject to the provisions of this
Award Agreement. A Grantee may not assign, sell, pledge, or otherwise transfer
Shares or cash to which he or she may be entitled hereunder prior to transfer or
payment thereof to the Grantee, and any such attempted assignment, sale, pledge
or transfer shall be void.

Section 7.
Responsibility for Taxes

a.
Regardless of any action the Company and/or the Grantee’s employer (the
“Employer”) takes with respect to any or all income tax (including federal,
state, local and non-U.S. tax), social insurance, payroll tax, fringe benefits
tax, payment on account or other tax related items related to the Grantee’s
participation in the Plan and legally applicable to the Grantee (“Tax Related
Items”), the Grantee acknowledges that the ultimate liability for all Tax
Related Items is and remains the Grantee’s responsibility and may exceed the
amount actually withheld by the Company or the Employer. The Grantee further
acknowledges that the Company and the Employer (i) make no representations or
undertakings regarding the treatment of any Tax Related Items in connection with
any aspect of the Award, including the grant of the Restricted Stock Units, the
vesting of the Restricted Stock Units and the lapse of restrictions, the
transfer and issuance of any Shares, the receipt of any cash payment pursuant to
the Award, the receipt of any dividends and the sale of any Shares acquired
pursuant to this Award; and (ii) do not commit to and are under no obligation to
structure the terms of the grant or any aspect of the Award to reduce or
eliminate the Grantee’s liability for Tax Related Items or achieve any
particular tax result. Furthermore, if the Grantee becomes subject to Tax
Related Items in more than one jurisdiction, the Grantee acknowledges that the
Company and/or the Employer (or former employer, as applicable) may be required
to withhold or account for Tax Related Items in more than one jurisdiction.

b.
Prior to the applicable taxable or tax withholding event, as applicable, the
Grantee shall pay or make adequate arrangements satisfactory to the Company
and/or the Employer to satisfy all Tax Related Items.

c.
If the Restricted Stock Units are paid to the Grantee in cash in lieu of Shares,
the Grantee authorizes the Company and/or the Employer, or their respective
agents, at their discretion, to satisfy any obligation for Tax Related Items by
withholding from the cash amount paid to the Grantee pursuant to the Award or
from the Grantee’s wages or other cash compensation paid to the Grantee by the
Company and/or the Employer.

d.
If the Restricted Stock Units are paid to the Grantee in Shares and the Grantee
is not subject to the short-swing profit rules of Section 16(b) of the Exchange
Act, the Grantee authorizes the Company and/or the Employer, or their respective
agents, at their discretion, to (i) withhold from the Grantee’s wages or other
cash compensation paid to the Grantee by the Company and/or the Employer, (ii)
arrange for the sale of Shares to be issued upon settlement of the Award (on the
Grantee’s behalf and at the Grantee’s direction pursuant to this authorization
or such other authorization as the Grantee may be required to provide to the
Company or its designated broker in order for such sale to be effectuated) and
withhold from the proceeds of such sale, and/or (iii) withhold in Shares
otherwise issuable to the Grantee pursuant to this Award.

e.
If the Restricted Stock Units are paid to the Grantee in Shares and the Grantee
is subject to the short-swing profit rules of Section 16(b) of the Exchange Act,
the Company will withhold in Shares otherwise issuable to the Grantee pursuant
to this Award, unless the use of such withholding method is prevented by
applicable law or has materially adverse accounting or tax consequences, in
which case the withholding obligation for Tax Related Items may be satisfied by
one or a combination of the methods set forth in Section 7(d)(i) and (ii) above.

f.
Depending on the withholding method, the Company and/or the Employer may
withhold or account for Tax Related Items by considering applicable minimum
statutory withholding amounts or other applicable withholding rates, including
maximum applicable rates, in which case the Grantee may receive a refund of any
over-withheld amount in cash as soon as practicable and without interest and
will not be entitled to the equivalent amount in Shares. If the obligation for
Tax Related Items is satisfied by withholding Shares, for tax purposes, the
Grantee will be deemed to have been issued the full number of Shares to which he
or she is entitled pursuant to this Award, notwithstanding that a number of
Shares are withheld to satisfy the obligation for Tax Related Items.

g.
The Company may require the Grantee to pay the Company and/or the Employer any
amount of Tax Related Items that the Company and/or the Employer may be required
to withhold or account for as a result of any aspect of this Award that cannot
be satisfied by the means previously described. The Company may refuse to
deliver Shares or any cash payment to the Grantee if the Grantee fails to comply
with the Grantee’s obligation in connection with the Tax Related Items as
described in this Section 7.

Section 8.
Section 409A Compliance

To the extent applicable, it is intended that this Award comply with the
requirements of Section 409A of the U.S. Internal Revenue Code of 1986, as
amended and the Treasury Regulations and other guidance issued thereunder
(“Section 409A”) and this Award shall be interpreted and applied by the
Committee in a manner consistent with this intent in order to avoid the
imposition of any additional tax under Section 409A.

Section 9.
Nature of Grant

In accepting the grant, Grantee acknowledges, understands and agrees that:
a.
the Plan is established voluntarily by the Company, it is discretionary in
nature and it may be modified, amended, suspended or terminated by the Company
at any time, as provided in the Plan;

b.
the Award is voluntary and occasional and does not create any contractual or
other right to receive future awards of Restricted Stock Units, or benefits in
lieu thereof, even if Restricted Stock Units have been granted in the past;

c.
all decisions with respect to future awards of Restricted Stock Units or other
awards, if any, will be at the sole discretion of the Committee;

d.
the Grantee’s participation in the Plan is voluntary;

e.
the Award and any Shares subject to the Award are not intended to replace any
pension rights or compensation;

f.
the Award and any Shares subject to the Award, and the income and value of same,
are not part of normal or expected compensation for any purpose, including but
not limited to, calculating any severance, resignation, termination, redundancy,
dismissal, end of service payments, bonuses, long-service awards, holiday pay,
leave pay, pension or welfare or retirement benefits or similar mandatory
payments;

g.
unless otherwise agreed with the Company, the Award and any Shares subject to
the Award, and the income and value of same, are not granted as consideration
for, or in connection with, the service the Grantee may provide as a director of
an Affiliate;

h.
neither the Award nor any provision of this Award Agreement, the Plan or the
policies adopted pursuant to the Plan, confer upon the Grantee any right with
respect to employment or continuation of current employment, and in the event
that the Grantee is not an employee of the Company or any subsidiary of the
Company, the Award shall not be interpreted to form an employment contract or
relationship with the Company or any Affiliate;

i.
the future value of the underlying Shares is unknown, indeterminable and cannot
be predicted with certainty;

j.
no claim or entitlement to compensation or damages shall arise from forfeiture
of the Award resulting from the Grantee ceasing to provide employment or other
services to the Company or the Employer (for any reason whatsoever, whether or
not later found to be invalid or in breach of local labor laws in the
jurisdiction where the Grantee is employed or the terms of Grantee’s employment
agreement, if any);

k.
for purposes of the Award, the Grantee’s employment will be considered
terminated as of the date he or she is no longer actively providing services to
the Company or an Affiliate and the Grantee’s right, if any, to vest in and be
paid any portion of the Award after such termination of employment or services
(regardless of the reason for such termination and whether or not such
termination is later found to be invalid or in breach of employment laws in the
jurisdiction where the Grantee is employed or the terms of the Grantee’s
employment agreement, if any) will be measured by the date the Grantee ceases to
actively provide services and will not be extended by any notice period (e.g.,
active service would not include any contractual notice period or any period of
“garden leave” or similar period mandated under employment laws in the
jurisdiction where the Grantee is employed or the terms of the Grantee’s
employment agreement, if any); the Committee shall have the exclusive discretion
to determine when the Grantee is no longer actively providing services for
purposes of the Award (including whether the Grantee may still be considered to
be actively providing services while on a leave of absence);

l.
unless otherwise provided in the Plan or by the Committee in its discretion, the
Award and the benefits evidenced by this Award Agreement do not create any
entitlement to have the Award or any such benefits transferred to, or assumed
by, another company nor to be exchanged, cashed out or substituted for, in
connection with any corporate transaction affecting the Shares; and

m.
neither the Company, the Employer nor any Affiliate shall be liable for any
foreign exchange rate fluctuation between the Grantee’s local currency and the
United States Dollar that may affect the value of the Award or any amounts due
to the Grantee pursuant to the settlement of the Award or the subsequent sale of
any Shares acquired upon settlement.

Section 10.
Data Privacy

a.
Data Collection and Usage. The Company and the Employer may collect, process and
use certain personal information about the Grantee, and persons closely
associated with the Grantee, including, but not limited to, the Grantee’s name,
home address and telephone number, email address, date of birth, social
insurance number, passport or other identification number (e.g., resident
registration number), salary, nationality, job title, any shares of stock or
directorships held in the Company, details of all Restricted Stock Units or any
other entitlement to shares of stock awarded, canceled, exercised, vested,
unvested or outstanding in the Grantee’s favor (“Data”), for the purposes of
implementing, administering and managing the Plan. The legal basis, where
required, for the processing of Data is the Grantee’s consent. Where required
under Applicable Law, Data may also be disclosed to certain securities or other
regulatory authorities where the Company’s securities are listed or traded or
regulatory filings are made and the legal basis, where required, for such
disclosure are the Applicable Laws.

b.
Stock Plan Administration Service Providers. The Company transfers Data to UBS
Financial Services Inc. and/or its affiliated companies (“UBS”), an independent
service provider, which is assisting the Company with the implementation,
administration and management of the Plan. In the future, the Company may select
a different service provider and share Data with such other provider serving in
a similar manner. The Grantee may be asked to agree on separate terms and data
processing practices with the service provider, with such agreement being a
condition to the ability to participate in the Plan.

c.
International Data Transfers. The Company and its service providers are based in
the United States. The Grantee’s country or jurisdiction may have different data
privacy laws and protections than the United States. For example, the European
Commission has issued a limited adequacy finding with respect to the United
States that applies only to the extent companies register for the EU-U.S.
Privacy Shield program, which is open to companies subject to Federal Trade
Commission jurisdiction and in which the Company participates with respect to
employee data. The Company’s legal basis, where required, for the transfer of
Data is the Grantee’s consent.

d.
Data Retention. The Company will hold and use the Data only as long as is
necessary to implement, administer and manage the Grantee’s participation in the
Plan, or as required to comply with legal or regulatory obligations, including
under tax and security laws.

e.
Data Subject Rights. The Grantee understands that data subject rights regarding
the processing of Data vary depending on applicable law and that, depending on
where the Grantee is based and subject to the conditions set out in such
applicable law, the Grantee may have, without limitation, the right to (i)
inquire whether and what kind of Data the Company holds about the Grantee and
how it is processed, and to access or request copies of such Data, (ii) request
the correction or supplementation of Data about the Grantee that is inaccurate,
incomplete or out-of-date in light of the purposes underlying the processing,
(iii) obtain the erasure of Data no longer necessary for the purposes underlying
the processing, (iv) request the Company to restrict the processing of the
Grantee’s Data in certain situations where the Grantee feels its processing is
inappropriate, (v) object, in certain circumstances, to the processing of Data
for legitimate interests, and to (vi) request portability of the Grantee’s Data
that the Grantee has actively or passively provided to the Company or the
Employer (which does not include data derived or inferred from the collected
data), where the processing of such Data is based on consent or the Grantee’s
employment and is carried out by automated means. In case of concerns, the
Grantee understands that he or she may also have the right to lodge a complaint
with the competent local data protection authority. Further, to receive
clarification of, or to exercise any of, the Grantee’s rights, the Grantee
understands that he or she should contact his or her local human resources
representative.

f.
Voluntariness and Consequences of Consent Denial or Withdrawal. Participation in
the Plan is voluntary and the Grantee is providing the consents herein on a
purely voluntary basis. If the Grantee does not consent, or if the Grantee later
seeks to revoke the Grantee’s consent, the Grantee’s salary from or employment
and career with the Employer will not be affected; the only consequence of
refusing or withdrawing the Grantee’s consent is that the Company would not be
able to grant this Award or other awards to the Grantee or administer or
maintain such awards.

g.
Declaration of Consent. By accepting the Award and indicating consent via the
Company’s online acceptance procedure, the Grantee is declaring that he or she
agrees with the data processing practices described herein and consents to the
collection, processing and use of Data by the Company and the transfer of Data
to the recipients mentioned above, including recipients located in countries
which do not adduce an adequate level of protection from a European (or other
non-U.S.) data protection law perspective, for the purposes described above.

Section 11.
Additional Terms and Conditions

a.
Country-Specific Conditions. The Award shall be subject to any special terms and
conditions set forth in any Appendix to this Award Agreement for the Grantee’s
country. Moreover, if the Grantee relocates to one of the countries included in
the Appendix, the special terms and conditions for such country will apply to
the Grantee, to the extent the Company determines that the application of such
terms and conditions is necessary or advisable for legal or administrative
reasons. The Appendix constitutes part of this Award Agreement.

b.
Insider Trading / Market Abuse Laws. The Grantee may be subject to insider
trading restrictions and/or market abuse laws in applicable jurisdictions,
including but not limited to the United States and the Grantee’s country of
residence, which may affect the Grantee’s ability to directly or indirectly, for
the Grantee or for a third party, acquire or sell, or attempt to sell, or
otherwise dispose of Shares or rights to acquire Shares (e.g., Restricted Stock
Units) under the Plan during such times as the Grantee is considered to have
“inside information” regarding the Company (as determined under the laws or
regulations in the applicable jurisdictions). Any restrictions under these laws
or regulations are separate from and in addition to any restrictions that may be
imposed under any applicable Company insider trading policy. The Grantee
acknowledges that it is his or her responsibility to comply with any applicable
restrictions, and the Grantee should consult with his or her personal legal
advisor on this matter.

c.
Imposition of Other Requirements. The Company reserves the right to impose other
requirements on the Award and any Shares acquired under the Plan, to the extent
the Company determines it is necessary or advisable for legal or administrative
reasons, and to require the Grantee to execute any additional agreements or
undertakings that may be necessary to accomplish the foregoing. Without
limitation to the foregoing, the Grantee agrees that the Restricted Stock Unit
Award and any benefits or proceeds the Grantee may receive hereunder shall be
subject to forfeiture and/or repayment to the Company to the extent required to
comply with any requirements imposed under Applicable Laws or any compensation
recovery policy of the Company that reflects the provisions of Applicable Laws.

Section 12.
Governing Law and Choice of Venue

The validity and construction of this Award Agreement shall be governed by the
laws of the State of Indiana, U.S.A. without regard to laws that might cause
other law to govern under applicable principles of conflict of laws. For
purposes of litigating any dispute that arises under this Award Agreement, the
parties hereby submit to and consent to the jurisdiction of the State of
Indiana, and agree that such litigation shall be conducted in the courts of
Hancock County, Indiana, or the federal courts for the United States for the
Southern District of Indiana, and no other courts, where this Award is granted
and/or to be performed.

Section 13.
Miscellaneous Provisions

a.
Notices and Electronic Delivery and Participation. Any notice to be given by the
Grantee or successor Grantee shall be in writing, and any notice shall be deemed
to have been given or made only upon receipt thereof by the Corporate Secretary
of the Company at the Elanco Animal Health Global Headquarters, Greenfield,
Indiana 46140, U.S.A. Any notice or communication by the Company in writing
shall be deemed to have been given in the case of the Grantee if mailed or
delivered to the Grantee at any address specified in writing to the Company by
the Grantee and, in the case of any successor Grantee, at the address specified
in writing to the Company by the successor Grantee. In addition, the Company
may, in its sole discretion, decide to deliver any documents related to the
Award and participation in the Plan by electronic means or request the Grantee’s
consent to participate in the Plan by electronic means. By accepting this Award,
the Grantee hereby consents to receive such documents by electronic delivery and
agrees to participate in the Plan through an on-line or electronic system
established and maintained by the Company or a third party designated by the
Company.

b.
Language. If the Grantee has received this Award Agreement or any other document
related to the Plan translated into a language other than English and if the
meaning of the translated version is different than the English version, the
English version will control.

c.
Waiver. The waiver by the Company of any provision of this Award Agreement at
any time or for any purpose shall not operate as or be construed to be a waiver
of the same or any other provision of this Award Agreement at any subsequent
time or for any other purpose.

d.
Severability and Section Headings. If one or more of the provisions of this
Award Agreement shall be held invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby and the invalid, illegal or
unenforceable provisions shall be deemed null and void; however, to the extent
permissible by law, any provisions which could be deemed null and void shall
first be construed, interpreted or revised retroactively to permit this Award
Agreement to be construed so as to foster the intent of this Award Agreement and
the Plan.

The section headings in this Award Agreement are for convenience of reference
only and shall not be deemed a part of, or germane to, the interpretation or
construction of this instrument.
e.
No Advice Regarding Grant. The Company is not providing any tax, legal or
financial advice, nor is the Company making any recommendations regarding the
Grantee’s participation in the Plan or the Grantee’s acquisition or sale of the
underlying Shares. The Grantee should consult with his or her own personal tax,
legal and financial advisors regarding the Grantee’s participation in the Plan
before taking any action related to the Plan.

Section 14.
Award Subject to Acknowledgement of Acceptance

Notwithstanding any provisions of this Award Agreement, the Award is subject to
acknowledgement of acceptance by the Grantee on or prior to 4:00 PM (EDT) on the
60th day after the Grant Date, through the website of UBS, the Company’s stock
plan administrator. If the Grantee does not acknowledge acceptance of the Award
prior to 4:00 PM (EDT) on or prior to the 60th day after the Grant Date, the
Award will be cancelled, subject to the Committee’s discretion for unforeseen
circumstances.
IN WITNESS WHEREOF, the Company has caused this Award Agreement to be executed
in Greenfield, Indiana, by its proper officer.

ELANCO ANIMAL HEALTH INCORPORATED

By: /s/Jeffrey N. Simmons
Jeffrey N. Simmons
President, Chief Executive Officer and Director