THE
FEMALE HEALTH COMPANY
 NONSTATUTORY
STOCK OPTION GRANT AGREEMENT
 (Grant
No. _________)
 
 
 THIS
NONSTATUTORY STOCK OPTION GRANT AGREEMENT dated as of ____________ (the "Grant
Date"), is between __________________ ("Optionee") and THE FEMALE HEALTH
COMPANY, a Wisconsin corporation (the "Company").
 
 RECITALS
 
 A.  The Company adopted The Female Health Company 2008 Stock Incentive Plan
(the "Plan"), which was approved by its Board of Directors (the "Board") and
shareholders effective March 27, 2008.  The Plan is administered by
the Compensation Committee of the Board.
 
 B.
 The Administrator has designated Optionee as a participant in the
Plan.
 
 C.  Pursuant
to the Plan, Optionee and the Company desire to enter into this Agreement
setting forth the terms and conditions of the following option granted to
Optionee under the Plan.
 
 AGREEMENTS
 
 Optionee
and the Company agree as follows:
 
 1.  Grant of Stock
Option.  The Company grants to Optionee the right and option
(hereinafter referred to as the "Option") to purchase all or any part of up to
______ shares (the "Option Shares") of the Company's common stock, par
value $0.01 per share (the "Common Stock "), on the terms and conditions set
forth below and in the Plan.
 
 2.  Option
Price.  The purchase price of the Option Shares shall be
$______ per share, which is equal to or greater than the Fair Market Value of
the Common Stock on the Grant Date.  Payment of the purchase price
shall be made by the Optionee at the time of exercise in the form of cash or a
check or, to the extent permitted by the Administrator, under a cashless
exercise program implemented by the Company in connection with the
Plan.
 
 3.  Vesting; Period of
Exercise.  This Option shall vest as to the Option Shares as
follows:  ______________________________. Unless
the Option is terminated as provided hereunder or under the Plan, Optionee may
exercise this Option in whole or in part at any time after the Grant Date as to
any Option Shares that have vested until it expires at 5 p.m., Chicago, Illinois
time, on the ______ anniversary of the Grant Date (the "Option
Period").
 
 4.  Definitions.  Unless
provided to the contrary in this Agreement, the definitions contained in the
Plan and any amendments to the Plan shall apply to this Agreement.
 
 5.  Option
Designation.  This Option is a Nonstatutory Option in
accordance with Section 8 of the Plan.
 
 6.  Change in Capital
Structure.  The Option rights and exercise price of such Option
rights will be adjusted in the event of a stock dividend, stock split, reverse
stock split, recapitalization, reorganization, merger, consolidation,
acquisition or other change in the capital structure of the Company as
determined by the Administrator in accordance with the Plan.
 
 7.  Nontransferability of
Option.  The Option shall not be transferable other than by
will or the laws of descent or distribution and shall be exercisable, during
Optionee's lifetime, only by Optionee.
 
  1
  8.  Delivery by the
Company.  As soon as practicable after receipt of all items
referred to in Section 8(e)(i) of the Plan and any payment required by the
Plan (which payment may also be made in accordance with a cashless exercise
program implemented by the Company in connection with the Plan), the Company
shall deliver to Optionee certificate(s) issued in Optionee's name for the
number of Option Shares purchased by exercise of the Option (or, if requested by
the Optionee, such shares shall be issued to the Optionee by electronic transfer
to  the Optionee's broker).  If delivery is by mail,
delivery of Option Shares shall be deemed effected when the stock transfer agent
of the Company shall have deposited the certificates in the United States mail,
addressed to Optionee.
 
 9.  Addresses.  All
notices or statements required to be given to either party hereto shall be in
writing and shall be personally delivered or sent, in the case of the Company,
to its principal business office and, in the case of Optionee, to Optionee's
address as is shown on the records of the Company or to such address as Optionee
designates in writing.  Notice of any change of address shall be sent
to the other party by registered or certified mail.  It shall be
conclusively presumed that any notice or statement properly addressed and mailed
bearing the required postage stamps has been delivered to the party to which it
is addressed.
 
 10.  Restrictions Imposed by
Law.  Notwithstanding any other provision of this Agreement,
Optionee agrees that Optionee shall not exercise the Option and that the Company
will not be obligated to deliver any shares of Common Stock or make any cash
payment if counsel to the Company determines that such exercise, delivery or
payment would violate any law or regulation of any governmental authority or any
agreement between the Company and any national securities exchange upon which
the Common Stock is listed.  The Company shall in no event be
obligated to take any affirmative action in order to cause the exercise of the
Option or the resulting delivery of shares of Common Stock or other payment to
comply with any law or regulation of any governmental authority.
 
 11.  Service Provider
Relationship.  Nothing in this Agreement or in the Plan shall
limit the right of the Company or any parent or subsidiary of the Company to
terminate Optionee's employment or other form of service relationship or
otherwise impose any obligation to employ and/or retain Optionee as a service
provider.
 
 12.  Effect of Termination of
Service Provider Relationship.
 
 (a)  Termination of Relationship
as a Service Provider.  If the Optionee ceases to be a Service
Provider, other than upon the Optionee's death or Disability, retirement after
age 55 or termination for Cause, the Option (to the extent exercisable pursuant
to Section 3 above as of the date of the Optionee's termination) shall remain
exercisable for three months following the date of the Optionee's
termination.
 
 (b)  Disability or Retirement of
Optionee.  If the Optionee ceases to be a Service Provider as a
result of the Optionee's Disability or the Optionee's retirement after age 55,
the Option (to the extent exercisable pursuant to Section 3 above as of the date
of the Optionee's termination) shall remain exercisable for twelve months
following the date of the Optionee's termination.
 
 (c)  Death of
Optionee.  If the Optionee dies while a Service Provider, the
Option (to the extent exercisable pursuant to Section 3 above as of the date of
the Optionee's death) shall remain exercisable for twelve months following the
Optionee's death.  The Option may be exercised by the executor or
administrator of the Optionee's estate or, if none, by the person(s) entitled to
exercise the Option under the Optionee's will or the laws of descent or
distribution.
 
 (d)  Termination for
Cause.  If the Optionee ceases to be a Service Provider as a
result of a termination for Cause, the Option, to the extent not exercised
before such termination, shall forthwith terminate.
 
 (e)  Unvested
Options.  If the Option (or portion thereof) is not exercisable
pursuant to Section 3 above as of the date of the Optionee's termination
for any reason, the Option (or portion thereof) shall terminate as of the date
of termination.
  13.  Governing
Law.  This Agreement shall be construed, administered and
governed in all respects under and by the laws of the State
 of
Wisconsin.
  2
  14.  Provisions Consistent with
Plan.  This Agreement is intended to be construed to be
consistent with, and is subject to, all applicable provisions of the Plan, which
is incorporated herein by reference.  In the event of a conflict
between the provisions of this Agreement and the Plan, the provisions of the
Plan shall prevail.
 
 
 _______________________________________
 [Name of
Optionee]
  THE
FEMALE HEALTH COMPANY
  BY____________________________________
 
  3
  
 EXHIBIT
A
 
 Option
Exercise
 
 
 1.  I
exercise my option to purchase the number of shares of The Female Health Company
(the “Company”) common stock shown below pursuant to the Company’s 2008 Stock
Incentive Plan.
 
 Grant Agreement
              Options ExercisedDate____________________
                
                Grant
      No._________________
              Number____________________
                
                Per
      Share
                Option
      Price_________________
                
                Option
      Price
                Enclosed____________________
 2.  In
connection with this Option exercise, I represent the following:
 
 (a) All
conditions under the above-referenced Grant Agreement have been met with respect
to the Options exercised.
 
 (b) I
have had access to and have reviewed all current publicly available reports
filed by the Company with the Securities and Exchange Commission and have based
my purchase on that information and not on any other oral or written information
supplied by the Company.
 
 3.  I
understand that before I receive my certificate for the shares referenced above,
the Company requires me to remit to it an amount sufficient to satisfy any
outstanding amounts due the Company and to satisfy any federal, state or local
withholding tax requirements.
 
 
 
 Date____________________
              Name_______________________________
                (Please
      print name exactly as it should appear
                on
      your stock certificate)Signature______________________________