**Exhibit 10.8(g)**

** **

**HOSPIRA2004 LONG-TERM STOCK INCENTIVE PLAN**

** **

**NQSOTERMS**

** **

**NON-EMPLOYEEDIRECTOR AWARD**

** **

The Participant has beengranted an Option by Hospira, Inc. (the “Company”) under the terms of theHospira 2004 Long-Term Stock Incentive Plan (the “Plan”).  The Option shall be subject to the followingterms and conditions (the “Option Terms”):

 

1.                                       Termsof Award.  The following  words and phrases relating to the grant ofthe Option shall have the following meanings:

 

(a)                                  The“Participant” is                               .

 

(b)                                 The“Grant Date” is                                            .

 

(c)                                  Thenumber of “Covered Shares” shall be                         shares of Stock.

 

(d)                                 The“Exercise Price” is $               per share.

 

Except where the context clearly implies to the contrary, anycapitalized term in this award shall have the meaning ascribed to that termunder the Plan.

 

2.                                       Non-QualifiedStock Option.  The Option is notintended to constitute an “incentive stock option” as that term is used in Codesection 422.

 

3.                                       Dateof Exercise.  Subject to thelimitations of the Option Terms, as of the Grant Date one-third of the CoveredShares (rounded up) may be purchased; as of the one-year anniversary of theGrant Date two-thirds of the Covered Shares (rounded up) may be purchased; asof the two-year anniversary of the Grant Date the Option may be exercised infull, provided the Expiration Date has not occurred prior to such dates.

 

(a)                                  Notwithstandingthe foregoing provisions of this paragraph 3, the Option shall become fullyexercisable upon a Change in Control that occurs on or before the Date ofTermination.

 

(b)                                 TheOption may be exercised (prior to or following the Date of Termination) only asto that portion of the Covered Shares for which may be purchased under theforegoing schedule, as of the date of exercise.

 

(c)                                  TheCovered Shares shall continue to become exercisable pursuant to thisSection 3 until the Expiration Date, as defined in Section 4.

 

4.                                       Expiration.  The Option shall not be exercisable afterthe Company’s close of business on the last business day that occurs prior tothe Expiration Date.  The “ExpirationDate” shall be the earliest to occur of:

 

----

 

(a)                                  theten-year anniversary of the Grant Date;

 

(b)                                 ifthe termination of service occurs for reasons other than death, Retirement (asdefined in Section 7) or for Cause (as defined in section 7), thethree-month anniversary of the Date of Termination (as defined inSection 7); provided, however, that if the Participant dies during suchthree month period following the Date of Termination, then the three-monthanniversary of the date of death;

 

(c)                                  inthe event of the Director’s voluntary Retirement, which occurs prior to the90-day anniversary of the Grant Date, the date of such Retirement; or

 

(d)                                 thedate on which the Participant engages in conduct which constitutes Cause.

 

5.                                       Methodof Option Exercise.  Subject to theOption Terms and the Plan, the Option may be exercised in whole or in part byfiling a written notice with the Secretary of the Company at its corporateheadquarters prior to the Company’s close of business on the last business daythat occurs prior to the Expiration Date. Such notice shall specify the number of shares of Stock which theParticipant elects to purchase, and shall be accompanied by payment of theExercise Price for such shares of Stock indicated by the Participant’selection. Payment may be by cash or by check payable to the Company, or exceptas otherwise provided by the Committee before the Option is exercised: (i) allor a portion of the Exercise Price may be paid by the Participant by deliveryof shares of Stock (by actual delivery or by attestation) owned by theParticipant and acceptable to the Committee having an aggregate Fair MarketValue (valued as of the date of exercise) that is equal to the amount of cashthat would otherwise be required; and (ii) the Participant may pay the ExercisePrice by authorizing a third party to sell shares of Stock (or a sufficientportion of the shares) acquired upon exercise of the Option and remit to theCompany a sufficient portion of the sale proceeds to pay the entire ExercisePrice and any tax withholding resulting from such exercise.  Except as otherwise provided by the Committee,payments made with shares of Stock in accordance with clause (i) above shall belimited to shares held by the Participant for not less than six months prior tothe payment date.  The Option shall notbe exercisable if and to the extent the Company determines that such exercisewould violate applicable state or Federal securities laws or the rules andregulations of any securities exchange on which the Stock is traded, and shallnot be exercisable during any blackout period established by the Company fromtime to time.

 

6.                                       Transferability.  Except as otherwise provided by thecommittee, the Option is not transferable by the Participant other than by willor by the laws of descent and distribution, and during the Participant’s life,may be exercised only by the Participant. It may not be assigned, transferred (except as aforesaid), pledged orhypothecated by the Participant in any way whether by operation of law orotherwise, and shall not be subject to execution, attachment or similarprocess.  Any attempt at assignment,transfer, pledge or hypothecation, or other disposition of this Option contraryto the provisions hereof, and the levy of any attachment or similar processupon this option, shall be null and void and without effect.

 

7.                                       Definitions.  For purposes of the Option Terms, words andphrases shall be defined as follows:

 

2

----

 

(a)                                  Cause.  The term “Cause” shall mean, in the soleopinion and discretion of the Committee, the Participant has (i) engaged in amaterial breach of the Company’s code of business conduct, (ii) committed anact of fraud, embezzlement or theft in connection with the Participant’s dutiesor in the course of service as a Board member, or (iii) wrongfully disclosedsecret processes or confidential information of the Company or itssubsidiaries.

 

(b)                                 Dateof Termination.  The term “Date ofTermination” means the day following the last date on which the Participantserves as a Director for the Company.

 

(c)                                  Retirement.  “Retirement” of the Participant means, thevoluntary termination by the Director following attainment of age 65.

 

8.                                       Heirsand Successors.  The Option Termsshall be binding upon, and inure to the benefit of, the Company and itssuccessors and assigns, and upon any person acquiring, whether by merger, consolidation,purchase of assets or otherwise, all or substantially all of the Company’sassets and business. If any rights exercisable by the Participant or benefitsdeliverable to the Participant under the Option Terms have not been exercisedor delivered, respectively, at the time of the Participant’s death, such rightsshall be exercisable by the Designated Beneficiary, and such benefits shall bedelivered to the Designated Beneficiary, in accordance with the provisions ofthe Option Terms and the Plan. The “Designated Beneficiary” shall be thebeneficiary or beneficiaries designated by the Participant in a writing filedwith the Committee in such form and at such time as the Committee shallrequire. If a deceased Participant fails to designate a beneficiary, or if theDesignated Beneficiary does not survive the Participant, any rights that wouldhave been exercisable by the Participant and any benefits distributable to theParticipant shall be exercised by or distributed to the legal representative ofthe estate of the Participant. If a deceased Participant designates abeneficiary and the Designated Beneficiary survives the Participant but diesbefore the Designated Beneficiary’s exercise of all rights under the OptionTerms or before the complete distribution of benefits to the DesignatedBeneficiary under the Option Terms, then any rights that would have beenexercisable by the Designated Beneficiary shall be exercised by the legalrepresentative of the estate of the Designated Beneficiary, and any benefitsdistributable to the Designated Beneficiary shall be distributed to the legalrepresentative of the estate of the Designated Beneficiary.

 

9.                                       Administration.  The authority to manage and control theoperation and administration of the Option Terms shall be vested in theCommittee, and the Committee shall have all powers with respect to the OptionTerms as it has with respect to the Plan. Any interpretation of the OptionTerms by the Committee and any decision made by it with respect to the OptionTerms is final and binding on all persons.

 

10.                                 PlanGoverns. Notwithstanding anything in the Option Terms to the contrary, theOption Terms shall be subject to the terms of the Plan, a copy of which may beobtained by the Participant from the office of the Secretary of the Company;and the Option Terms is subject to all interpretations, amendments, rules andregulations promulgated by the Committee from time to time pursuant to thePlan.

 

3

----

 

11.                                 Notices.  Any written notices provided for in theOption Terms or the Plan shall be in writing and shall be deemed sufficientlygiven if either hand delivered or if sent by fax or overnight courier, or bypostage paid first class mail. Notices sent by mail shall be deemed receivedthree business days after mailing but in no event later than the date of actualreceipt. Notices shall be directed, if to the Participant, at the Participant’saddress indicated by the Company’s records, or if to the Company, at theCompany’s principal executive office.

 

12.                                 FractionalShares. In lieu of issuing a fraction of a share upon any exercise of theOption, resulting from an adjustment of the Option pursuant to paragraph 4.2(f)of the Plan or otherwise, the Company will be entitled to pay to theParticipant an amount equal to the fair market value of such fractional share.

 

13.                                 NoRights As Shareholder.  TheParticipant shall not have any rights of a shareholder with respect to theshares subject to the Option, until a stock certificate has been duly issuedfollowing exercise of the Option as provided herein.

 

14.                                 Amendment.  The Option Terms may be amended inaccordance with the provisions of the Plan, and may otherwise be amended bywritten agreement of the Participant and the Company without the consent of anyother person.

 

IN WITNESS WHEREOF, theCompany has caused these presents to be executed in its name and on its behalf,all as of the Grant Date.

 
|   | Hospira,  Inc. |
|--------|----------------|
|   |           |
|   |           |
|   | By:            |   |
|   | Its:           |   |

 

4

----