Document:

Exhibit 10.33

Exhibit 10.33

HILLENBRAND, INC. STOCK INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

This Restricted Stock Award Agreement (this “Agreement”) is effective as of the
 _____ 

day of

 _____, 20_____, between Hillenbrand, Inc. (the “Company”) and
 _____ 

(the
“Employee”). The Award of shares of Restricted Stock made herein is a performance based award.
The number of shares of Restricted Stock that will ultimately vest free of the restrictions in this
Agreement, which will not be determined until the end of the Measurement Period, will depend on the
amount of shareholder value created by the Company’s financial performance during the Measurement
Period, as compared to the expected amount of shareholder value to be created during the
Measurement Period.

AWARD INFORMATION

	 	 	 
	Target Restricted Stock Award

(100% achievement of performance target)

	 	
 _____ 

Shares of Restricted Stock
	Maximum Restricted Stock Award

(150% or greater achievement of
performance target)

	 	
 _____ 

Shares of Restricted Stock
	Measurement Period (three fiscal years)

	 	October 1, 20_____ 

through September 30, 20_____ 

	Base Shareholder Value

(at the beginning of Measurement Period)

	 	$__ million
	Incremental Shareholder Value Expected

	 	$__ million
	Weighted Average Cost of Capital

	 	
 _____%

 

 

 

AWARD DETERMINATION

Award Formula

The number of Shares of Restricted Stock that will vest at the end of the Measurement Period
is a function of the amount of Incremental Shareholder Value Delivered over the Measurement Period
as compared to the Incremental Shareholder Value Expected to be created over the Measurement
Period. Except as otherwise provided below in the Terms and Conditions, at the end of the
Measurement Period all restrictions will lapse on, and the Shares will become fully vested with
respect to, the number of whole Shares (rounded down) equal to the product of (a) the
number of Shares comprising the Target Restricted Stock Award, and (b) a multiplier, as provided in
the following table, based on the ratio, expressed as a percentage, of Incremental Shareholder
Value Delivered for the Measurement Period (as determined below) to the Incremental Shareholder
Value Expected for the Measurement Period:

	 	 	 
	Incremental Shareholder Value Delivered	 	 
	as Percentage of	 	 
	Incremental Shareholder Value Expected	 	Multiplier
	(rounded down to nearest whole percent)	 	(rounded down to two decimal places)
	Less than 50%

	 	zero (no Shares vest)
	At least 50% but less than 80%

	 	.2 plus an additional .01 for each
full percentage point realized
above minimum for range
	At least 80% but less than 100%

	 	.5 plus an additional .025 for each
full percentage point realized
above minimum for range
	At least 100% but less than 110%

	 	1.0 plus an additional .025 for
each full percentage point realized
above minimum for range
	At least 110% but less than 150%

	 	1.25 plus an additional .00625 for
each full point realized above
minimum for range
	At least 150%

	 	1.5 (all Shares vest)

Calculation of Incremental Shareholder Value Delivered

The amount of Incremental Shareholder Value Delivered during the Measurement Period is
calculated by subtracting the Base Shareholder Value from the Shareholder Value Delivered, and the
Shareholder Value Delivered is calculated by adding two components: the Net Operating Profit After
Tax (“NOPAT”) Component and the Cash Flows Component.

1. The NOPAT Component of Shareholder Value Delivered is the Company’s Adjusted NOPAT for the
last fiscal year of the Measurement Period, divided by the Weighted Average Cost of Capital.

2. The Cash Flows Component of Shareholder Value Delivered is the sum of the following:

(a) the Company’s Adjusted Cash Flows for the third fiscal year in the Measurement
Period;

(b) the Company’s Adjusted Cash Flows for the second fiscal year in the Measurement
Period, multiplied by the sum of 100 percent and the Weighted Average Cost of Capital; and

(c) the Company’s Adjusted Cash Flows for the first fiscal year in the Measurement
Period, multiplied by the square of the sum of 100 percent and the Weighted Average Cost of
Capital.

TERMS AND CONDITIONS

1. Grant of Restricted Stock. Pursuant to and subject to the terms and conditions of
the Hillenbrand, Inc. Stock Incentive Plan (as amended from time to time, the “Plan”), the Company
hereby awards and is issuing to the Employee, who is an employee of the Company or one of its
Subsidiaries, the number of shares of Restricted Stock specified above as the Maximum Restricted
Stock Award (the “Shares”), and agrees to distribute to the Employee the number of Dividend Shares determined to be distributable to the Employee (if any) pursuant to,
and at the time provided in, Paragraph 6.

 

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2. Acceptance; Transfer Restrictions. The Employee hereby accepts the award of Shares
described in this Agreement and agrees that the Shares will be owned and held by the Employee and
the Employee’s successors subject to (and will not be disposed of except in accordance with) all of
the restrictions, terms and conditions contained in this Agreement and the Plan. Except as
otherwise provided in this Agreement or the Plan, the Employee may not sell, assign, transfer,
pledge or otherwise dispose of or encumber any of the Shares, or any interest in the Shares, until
the Measurement Period expires, at which time the restrictions will lapse and the Employee’s rights
in the Shares will vest to the extent provided in this Agreement. Any purported sale, assignment,
transfer, pledge or other disposition or encumbrance in violation of this Agreement or the Plan
will be void and of no effect.

3. Vesting/Measurement Period. If the Employee remains employed by the Company or a
Subsidiary through the end of the Measurement Period, then at the end of the Measurement Period all
restrictions on the Shares will lapse, and the Shares will become fully vested and not subject to
forfeiture, to the extent determined under “Award Determination” above. If the Employee does not
remain employed through the end of the Measurement Period, the provisions of Paragraph 8 below will
apply in determining the number of Shares, if any, that will become vested Shares at the end of the
Measurement Period. All Shares not vested at the end of the Measurement Period will be forfeited,
and the Employee will have no rights or interest in or to those forfeited Shares.

4. Issuance of Shares and Stock Power. The Company, in its discretion, shall as soon
as practicable after the effective date of this Agreement either (i) issue the Shares to the
Employee in book entry form, with a notation that such Shares are subject to the restrictions,
terms and conditions of this Agreement, or (ii) issue stock certificates for the Shares registered
in the Employee’s name that the Company or its designee will hold until the Measurement Period
expires or the restrictions on the Shares represented thereby otherwise lapse and further actions
are to be taken with respect thereto under this Agreement. The Employee shall upon request
immediately execute and deliver to the Company or its designee a stock power endorsed in blank
relating to the Shares, and the Company or its designee will hold that stock power for its use when
the Measurement Period expires or the restrictions as to the Shares otherwise lapse and further
actions are to be taken with respect thereto under this Agreement.

5. Voting Rights. To the extent permitted or required by applicable law, as
determined by the Company, the Employee may exercise full voting rights with respect to the Shares
during the Measurement Period.

6. Dividends and Other Distributions; Dividend Shares. During the Measurement Period
and thereafter until the Shares that have become vested Shares as of the end of the Measurement
Period have been delivered to the Employee in certificate or book entry form under Paragraph 7 (the
“Dividend Period”), all dividends and other distributions paid with respect to the Shares (based on
the Maximum Restricted Stock Award number of Shares) will be paid to the Company on behalf of the
Employee (subject to the same restrictions on transferability, vesting and forfeitability as the
Shares with respect to which they were paid) and will be deemed to have been (but will not actually
be) invested on the date paid in notional shares of the Company’s Common Stock (the “Dividend
Shares”)

 

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purchased at the then current Fair Market Value. The number of Dividend Shares that are deemed to have been purchased under this
Paragraph shall be recorded as being credited to the Employee on the Company’s books and records.
In addition, during the Dividend Period the Company will, on its books and records, credit the
Employee as of each dividend payment date with additional Dividend Shares equal to the number of
notional shares of Common Stock that could have been purchased on such date, at the then current
Fair Market Value, with the amount of dividends that would have been payable at the per share rate
with respect to previously credited Dividend Shares. At the time settlement is made with respect
to the vested Shares pursuant to Paragraph 7, the Company will issue to the Employee (in addition
to and in the same manner as the vested Shares) that number of shares of the Company’s Common Stock
(rounded up to the next whole share) equal to the credited Dividend Shares multiplied by a
fraction, the numerator of which is the number of Shares vested under Paragraph 3 and the
denominator of which is the Maximum Restricted Stock Award number of Shares. Any remaining
Dividend Shares on the Company’s records shall be forfeited and the Employee shall have no right
thereto or interest therein.

7. Actions after Vesting is Determined. As soon after the end of the Measurement
Period as is practicable, and in any event on or before the end of the calendar year during which
the Measurement Period ends, the Company shall in its discretion either deliver to the Employee
stock certificates representing, or shall instruct the Company’s transfer agent to recognize in
book entry form that the Employee is the registered holder of, the number of Shares that have
become vested Shares under this Agreement as of the end of the Measurement Period, free from any
restrictions or other terms and conditions of this Agreement. At that same time, the Company shall
take such actions as it shall deem appropriate to cancel the forfeited Shares and to cause them to
no longer be recognized as outstanding shares of the Company’s Common Stock. In addition, the
Company shall issue to the Employee the number of Dividend Shares (if any) that the Employee is
entitled to receive pursuant to Paragraph 6. The Employee (or his or her successors) shall execute
and deliver such instruments and take such other actions as the Company shall reasonably request
with respect to the actions to be taken pursuant to this Paragraph.

8. Termination of Employment. If the Employee’s employment with the Company and/or a
Subsidiary terminates during the Measurement Period (a transfer of employment among the Company and
its Subsidiaries will not be treated as a termination of employment), then all or some portion of
the Shares that would otherwise have become vested Shares had the Employee remained employed
throughout the entire Measurement Period, if any (the “Full Period Shares”), will vest or be
forfeited as follows:

(a) if the Employee’s employment terminates due to death, Disability or Retirement,
then at the end of the Measurement Period the restrictions will lapse on that number of
Shares, and the number of Shares that then become vested Shares will be, equal to the
product (rounded down to the nearest whole share) of (i) the number of Full Period Shares,
and (ii) a fraction, the numerator of which is the sum (to a maximum of 156) of 52 plus the
number of full weeks in the Measurement Period during which the Employee was employed by the
Company or a Subsidiary, and the denominator of which is 156;

(b) if the Employee’s employment terminates due to involuntary termination without
Cause, then at the end of the Measurement Period the restrictions will lapse on that number
of Shares, and the number of Shares that then become vested Shares will be, equal to the product (rounded down to the nearest whole share) of (i) the number of
Full Period Shares, and (ii) a fraction, the numerator of which is the number of full weeks
in the Measurement Period during which the Employee was employed by the Company or a
Subsidiary, and the denominator of which is 156.

 

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(c) if the Employee, at termination of employment, is a party to a written employment
agreement with the Company or a Subsidiary that provides for the voluntary termination of
employment by the Employee for Good Reason, and if the Employee terminates employment
voluntarily for Good Reason, then at the end of the Measurement Period the restrictions will
lapse on that number of Shares, and the number of Shares that then become vested Shares will
be, the same portion of the Full Period Shares as if the Employee’s employment had been
involuntarily terminated without Cause, as determined under subparagraph (b) of this
Paragraph; and

(d) upon termination of the Employee’s employment for any reason other than those
described in subparagraph (a), (b), or (c) of this Paragraph, all of the Shares will be
forfeited immediately upon the termination of the Employee’s employment.

9. Change in Control. Upon the occurrence of a Change in Control during the
Measurement Period, the restrictions will lapse immediately on the number of Shares equal to
product (rounded down to the nearest whole Share) of (i) the number of Shares equal to the Target
Restricted Stock Award and (ii) a fraction, the numerator of which is the number of full weeks in
the Measurement Period prior to the Change in Control, and the denominator of which is 156, and all
other Shares will be forfeited. If the Employee is a party to a Change in Control Agreement with
the Company or a Subsidiary that, by its terms, covers outstanding awards of Restricted Stock, this
Agreement supersedes the terms of that Change in Control Agreement with respect to the Shares and
the vesting or forfeiture thereof.

10. Potential Repayment Obligation. If the Company is required, because of fraud or
negligence, to restate its financial statements for any fiscal year(s) included in the Measurement
Period and such restatement occurs after the end of the Measurement Period but within three (3)
years after the end of the fiscal year being restated (as so restated, the financial statements
restated within such three (3) year period are referred to herein as the “Restated Financial
Statements,” and for clarification purposes any restatement of the Company’s financial statements
for a fiscal year that occurs more than three (3) years after the end of such fiscal year shall not
be relevant under, and shall not be considered to be a Restated Financial Statement for purposes
of, this Section), and if the number of Shares of Restricted Stock and Dividend Shares earned by
the Employee under this Agreement (shares that vested and were not forfeited as calculated in
accordance with the Company’s financial statements prior to the restatement thereof, being referred
to herein as the “Previously Earned Shares”) is greater than the number of Shares of Restricted
Stock and Dividend Shares that would have been earned by the Employee hereunder if the number of
shares earned had been calculated in accordance with the Restated Financial Statements (the
“Recalculated Earned Shares,” with the excess of the number of Previously Earned Shares over the
number of Recalculated Earned Shares being referred to herein as the “Excess Issued Shares”), then
the Company may, in its discretion, by written demand made upon the Employee at any time within
three (3) years after the end of the Measurement Period (the “Share Return Notification”), require
the Employee to return to the Company all or any lesser specified number of the Excess Issued
Shares

 

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(with the number of shares to be returned to the Company being referred to herein as the
“Return Shares”). Within ninety (90) days after the Share Return Notification is given to the Employee, the Employee
shall either (a) transfer to the Company, free and clear of all liens, security interests or other
encumbrances, that number of shares of the Company’s common stock equal to the Return Shares, or
(b) pay to the Company a sum equal to the Fair Market Value of the Return Shares as of the last day
of the Measurement Period, or (c) by a combination of shares transferred and cash paid to the
Company under clauses (a) and (b) above, effectively satisfy the obligation of the Employee to the
Company under this Section. If the Employee fails to satisfy his or her obligation to the Company
under this Section in full by the due date stated above, the Employee shall also pay to the Company
interest on the cash amount of such obligation (calculated pursuant to clause (b) above) from such
due date until paid in full at a rate of interest equal to the prevailing national “prime rate” of
interest on such due date plus an amount equal to the attorneys’ fees incurred by the Company in
collecting amounts due from the Employee under this Section. After the Return Shares (or the cash
equivalent) have been transferred back to the Company as required herein, the Company shall file
such federal and state tax returns or amended returns, amended W-2 forms, or other tax filings as
shall be required of it by applicable law or as reasonably requested by the Employee with respect
to all excess income and FICA taxes withheld and/or paid by the Company in connection with or
attributable to the Return Shares. The provisions of this Section shall not be applicable to
Shares that are earned upon a Change in Control pursuant to Paragraph 9 of this Agreement.

11. Withholding. At the time of the delivery of any vested Shares pursuant to
Paragraph 7 of this Agreement, the Company has the right and power to deduct or withhold, or
require the Employee to remit to the Company, an amount sufficient to satisfy all applicable tax
withholding requirements with respect to such vested Shares. The Company may permit or require the
Employee to satisfy all or part of the tax withholding obligations in connection with this
Agreement by (a) having the Company withhold otherwise deliverable Shares, or (b) delivering to the
Company shares of Company stock already owned for a period of at least six (6) months (or such
longer or shorter period as may be required to avoid a charge to earnings for financial accounting
purposes), in each case having a value equal to the amount to be withheld, which shall not exceed
the amount determined by the applicable minimum statutory tax withholding rate (or such other rate
as will not result in a negative accounting impact). For these purposes, the value of the Shares
to be withheld or delivered will be equal to the Fair Market Value as of the date that the taxes
are required to be withheld.

12. Tax Election. The Employee agrees that he or she will not make the election
provided for in Code Section 83(b) with respect to any Shares granted under this Agreement.

13. Notices. All notices and other communications required or permitted under this
Agreement shall be written and delivered personally or sent by registered or certified first-class
mail, postage prepaid and return receipt required, addressed as follows: if to the Company, to the
Company’s executive offices in Batesville, Indiana, and if to the Employee or his or her successor,
to the address last furnished by the Employee to the Company. The Company may, however, authorize
notice by any other means it deems desirable or efficient at a given time, such as notice by
facsimile or electronic mail.

14. No Employment Rights. Neither the Plan nor this Agreement confers upon the
Employee any right to continue in the employ or service of the Company or a Subsidiary or
interferes in any way with the right of the Company or a Subsidiary to terminate the Employee’s
employment or service at any time.

 

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15. Plan Controlling. The terms and conditions set forth in this Agreement are
subject in all respects to the terms and conditions of the Plan, which are controlling. All
determinations and interpretations of the Company are binding and conclusive upon the Employee and
his or her legal representatives. The Employee agrees to be bound by the terms and provisions of
the Plan.

16. Defined Terms. For purposes of this Agreement, the following terms have the
meanings provided in this Paragraph. The terms included in the Award Information section of this
Agreement have the values specified in that section. All other terms used in this Agreement as
capitalized defined terms shall have the meanings ascribed to them in the Plan.

(a) “Adjusted NOPAT” is net operating profit after tax adjusted for the following items
(net of tax where applicable):

(i) Income, losses or impairments from specific financial instruments held by
the Company immediately following the spin-off of the Company in 2008 (i.e., auction
rate securities, equity limited partnerships, common stock, and Forethought note);

(ii) Interest income on corporate investments and interest expense on corporate
debt;

(iii) Costs related to the spin-off of the Company in 2008;

(iv) All professional fees, due diligence fees, expenses, and integration costs
related to a specific acquisition;

(v) Amortization expense of intangible long-lived assets where internally
generated costs are not customarily capitalized in the normal course of the business
(e.g.: customer lists, patents, etc.);

(vi) All adjustments made to net income related to changes in the fair value of
contingent earn-out awards;

(vii) External extraordinary, non-recurring, and material legal costs (e.g.:
antitrust litigation);

(viii) Restructuring charges and other items related to a restructuring plan
approved by the CEO; and

(ix) Changes in accounting pronouncements in United States GAAP or applicable
international standards that cause an inconsistency in computation as originally
designed.

 

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(b) “Adjusted Cash Flows” means, with respect to each fiscal year in the Measurement
Period, the Company’s net cash provided by operating activities (whether positive or
negative) less its capital expenditures net of proceeds on the disposal of property, all as
shown on its audited financial statements for the fiscal year, as adjusted (net of tax where
applicable) to exclude the effects of the following items:

(i) Cash receipts or disbursements from financial instruments held by the
corporation immediately following the spin-off of the Company in 2008 (i.e., auction
rate securities, limited partnerships, and Forethought note);

(ii) Interest income on corporate investments and interest expense on corporate
debt;

(iii) Disbursements related to the spin-off of the Company in 2008;

(iv) External extraordinary, non-recurring, and material legal disbursements
(e.g., antitrust litigation);

(v) Changes in accounting pronouncements in United States GAAP or applicable
international standards that cause an inconsistency in computation as originally
designed; and

(vi) The cost of acquisitions, including all professional fees, due diligence
fees, expenses, and integration costs, amortized over a 36 month period beginning
the month after closing (payment of contingent earnouts (when made) shall be treated
as a component of the purchase price payment subject to a separate 36 month
amortization period at that time).

(c) “Cause” means:

(i) if the Employee is a party to a written employment agreement with the
Company or a Subsidiary that defines “cause” or a comparable term, the definition in
that employment agreement, and

(ii) if not, the Company’s good faith determination that the Employee has:

(1) failed or refused to comply fully and timely with any reasonable
instruction or order of the Company or applicable Subsidiary, provided that
such noncompliance is not based primarily on the Employee’s compliance with
applicable legal or ethical standards;

(2) 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 conduct that has the
potential to cause the Company or a Subsidiary or any of their respective
officers or directors embarrassment or ridicule;

(3) violated any applicable Company or Subsidiary policy or procedure,
including the Company’s Code of Ethical Business Conduct; or

(4) engaged in any act that is contrary to the best interests of or
would expose the Company, a Subsidiary, their related businesses, or any of
their respective officers or directors to probable civil or criminal liability, excluding the Employee’s actions in accordance with
applicable legal and ethical standard.

 

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(d) “Disability” means:

(i) if the Employee, at termination of employment, is a party to a written
employment agreement with the Company or a Subsidiary that defines “disability” or a
comparable term, the definition in such employment agreement, and

(ii) if not, the Company’s good faith determination that the Employee is
eligible (except for the waiting period) for permanent disability benefits under
Title II of the Federal Social Security Act.

(e) “Good Reason” means, if the Employee, at termination of employment, is a party to a
written employment agreement with the Company or a Subsidiary, the definition given to that
term or a comparable term in that agreement, if any.

(f) “Retirement” means termination of employment after having:

(i) completed at least five years of service in the aggregate with the Company,
Hill-Rom Holdings, Inc. (formerly known as Hillenbrand Industries, Inc.), or any
Subsidiaries of either of them, and

(ii) reached age fifty-five (55).

IN WITNESS WHEREOF the Company and the Employee have executed this Agreement as of the date
first above written.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	[EMPLOYEE SIGNATURE]	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Print Name:	 	 
	 

	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	HILLENBRAND, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By: 	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	Print Name:	 	 	 
	 

	 	 	 	 	 	 

	 	 
	 

	 	 	Title:	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

 

- 9 -Exhibit 10.34

Exhibit 10.34

HILLENBRAND, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

	 	 	 
	Name of Grantee:

	 	No. of Shares:
	 
	Grant Date:

	 	Price per Share:

This Non-Qualified Stock Option Agreement (this “Agreement”) by and between HILLENBRAND, INC.
(the “Company”) and the Grantee named above (referred to below as “you”) evidences the grant by the
Company of a Non-Qualified Stock Option to you on the date stated above (the “Grant Date”) and your
acceptance of such Option in accordance with the provisions of the Hillenbrand, Inc. Stock
Incentive Plan, as amended from time-to-time (the “Plan”).

Your Option is subject to the terms and conditions set forth in the Plan (which is
incorporated herein by reference), any rules and regulations adopted by the Board of Directors of
the Company or the committee of the Board which administers the Plan (collectively, the
“Committee”), and this Agreement. In the event of any conflict between the provisions of the Plan
and the provisions of this Agreement, the terms, conditions and provisions of the Plan shall
control, and this Agreement shall be deemed to be modified accordingly. This grant becomes
effective only if you sign and return to the Company a copy of this Agreement evidencing your
understanding of the terms and conditions of your Option. Any terms used in this Agreement as
capitalized defined terms that are not defined herein shall have the meanings set forth in the
Plan.

1. Option Grant. You have been granted an option (the “Option”) to purchase the
number of shares of the Company’s Common Stock, without par value (“Common Stock”), set forth
above. The Option is a “non-qualified stock option” and is not an incentive stock option within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).

2. Option Price. The price at which you may purchase the shares of Common Stock
covered by the Option is the price per share set forth above.

3. Term of Option. Your Option expires in all events on the tenth anniversary of the
Grant Date (the “Latest Expiration Date”). Your Option, however, may expire prior to such Latest
Expiration Date (in the event of the termination of your employment by the Company or one of its
Subsidiaries) as provided in paragraph 7 of this Agreement. Notwithstanding anything else to the
contrary contained in this Agreement, in no event can your Option be exercised after the Latest
Expiration Date set forth in this paragraph 3 or after an earlier expiration date provided under
paragraph 7.

 

 

 

4. Vesting of Option.

(a) Unless it becomes exercisable on an earlier date as provided in paragraphs 4(b) or
7 below and subject to those paragraphs, your Option will become exercisable with respect to
the first 33-1/3 percent of the shares of Common Stock covered by the Option on the first
anniversary of the Grant Date and your Option will become exercisable with respect to the
second and third 33-1/3 percent of the shares covered by Option on the second and third
anniversaries of the Grant Date, respectively, provided that you are and have been
continuously employed since the Grant Date as an employee of the Company or one of its
Subsidiaries on each such date.

(b) In the event of a Change in Control of the Company (as such term is defined in the
Plan), if you are employed by the Company or one of its Subsidiaries at the time such Change
in Control occurs, and if you have been continuously employed by the Company or one of its
Subsidiaries since the Grant Date, then your Option will become immediately exercisable as
to all shares of Common Stock at the time such event occurs.

5. Manner of Exercise. To the extent your Option has become exercisable with respect
to certain shares, you may, subject to limitations under applicable law, exercise the Option to
purchase all or any part of such shares at any time on or before the date the Option expires, but
in no case may fewer than 100 shares be purchased at any one time except to purchase a residue of
fewer than 100 shares. You may exercise your Option by giving written notice to the Company on a
form acceptable to the Company specifying the number of shares of Common Stock desired to be
purchased under this Agreement. The notice must be hand delivered, faxed, or mailed to the Company
at its corporate headquarters (currently One Batesville Boulevard, Batesville, Indiana 47006-7756);
Attention: General Counsel. The notice must be accompanied by payment of the aggregate option
price for such shares, which payment may be made in the following ways: in cash; by delivery of
shares of Common Stock; by broker-assisted cashless exercise; or by a combination of the above, in
each case subject to the terms and conditions set forth in paragraphs 6(a), 6(b), and 6(c) below.
Your Option will be deemed exercised on the date your notice of exercise (with required
accompaniments as described in paragraph 6) is received by the General Counsel of the Company at
its corporate headquarters during regular business hours.

6. Satisfaction of Option Price.

(a) Payment of Cash. Your Option may be exercised by payment of the option
price in cash (including cash equivalents, such as check, bank draft, money order, or wire
transfer to the order of the Company).

(b) Payment in Common Stock. Your Option may be exercised by the delivery of
unencumbered shares of Common Stock already owned by you for at least six months (either by
actual delivery of the shares or by providing an affidavit affirming ownership of the shares
in form and manner approved by the Committee). The shares will be valued at their fair
market value on the date of exercise as provided in the Plan. The stock certificates for
the shares you deliver in payment of the exercise price must be duly endorsed or accompanied
by appropriate stock powers. Only stock certificates issued solely in your name or jointly in your and your spouse’s name may be delivered.
Only whole shares may be delivered. Any portion of the exercise price in excess of the fair
market value of a whole number of shares must be paid in cash. If a certificate delivered
in exercise of your Option evidences more shares than are needed to pay the exercise price,
an appropriate replacement certificate will be issued to you for the excess shares.

 

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(c) Broker-Assisted Cashless Exercise. You may exercise your Option by
executing and delivering the documents necessary to irrevocably authorize a broker
acceptable to the Company to sell shares of Common Stock (or a sufficient portion of such
 shares) acquired upon exercise of the Option and remit to the Company a sufficient portion
of the sale proceeds to pay the entire option price and any withholding tax obligation
resulting from such exercise.

7. Effects of Termination of Employment.

(a) General. The provisions of this Section apply to your Option in the event
of the termination of your employment with the Company or one of its Subsidiaries prior to
the Latest Expiration Date. Authorized leaves of absence from the Company or a Subsidiary,
or transfers of employment between or among the Company and/or any of its Subsidiaries,
shall not constitute a termination of employment for purposes of this Agreement.

(b) Prior to First Anniversary. If your employment with the Company or one of
its Subsidiaries terminates for any reason or under any circumstances whatsoever prior to
the first annual anniversary of the Grant Date, and if this Option has not previously become
exercisable under Section 3(b) by reason of a Change in Control that occurred prior to the
termination of your employment, then your Option will expire at the time of the termination
of your employment and will not be, and will never become, exercisable as to any of the
 shares of Common Stock.

(c) On or After First Anniversary. If your employment with the Company or one
of its Subsidiaries terminates on or after the first annual anniversary of the Grant Date,
the following provisions apply to your Option:

(i) Retirement. If your employment terminates for any reason or under
any circumstances other than your death or your discharge by the Company or a
Subsidiary for Cause (as defined below), and if at the time of such termination of
employment you are at least fifty-five (55) years old and have completed not less
than five (5) continuous years of employment with the Company or a Subsidiary ending
on such date of termination, your termination of employment will be deemed to be a
retirement for purposes of this Option (notwithstanding the fact that it might also
fall within one of the other subsections set out below), and upon such retirement
this Option (A) will become fully exercisable as to all shares of Common Stock upon
such termination of employment, and (B) will expire on (and may be exercised at any
time on or before but not after) the earlier of (1) the date that is the fifth
(5th) annual anniversary of the date on which your employment terminated;
or (b) the Latest Expiration Date (as defined in Section 3). For purposes of determining whether
you have had five (5) continuous years of employment prior to your termination of
employment under this subsection, any period of continuous employment by Hill-Rom
Holdings, Inc. or one of its Subsidiaries prior to April 1, 2008, shall be counted
as if you were employed by the Company during such period of employment.

 

-3-

 

(ii) Disability or Death. If your employment terminates by reason of
your disability (as determined by the Committee) or by reason of your death, then
upon such termination this (A) Option will become fully exercisable as to all shares
of Common Stock upon such termination of employment, and (B) will expire on (and may
be exercised at any time on or before but not after) the earlier to occur of (1) the
date that is the fifth (5th) annual anniversary of the date on which your
employment terminated; or (b) the Latest Expiration Date (as defined in Section 3).

(iii) Termination Without Cause or With Good Reason. If your
employment is terminated by the Company or a Subsidiary without Cause for
terminating your employment, or if you voluntarily terminate your employment with
the Company or a Subsidiary but have Good Reason (as defined below) for doing so
(this provision relating to a termination of employment by you for “Good Reason”
will not be applicable to you if you do not have a written employment agreement
defining the term Good Reason, and your Option will not be subject to the provisions
of this clause (iii) in such event), then in either of such events this Option (A)
will be exercisable only as to that number of shares as to which it has become
exercisable on or prior to the date your employment is terminated (and will not
become further exercisable thereafter), and (B) will expire on (and may be exercised
at any time on or before but not after) the earlier to occur of (1) the date that is
the fifth (5th) annual anniversary of the date on which your employment
terminated; or (b) the Latest Expiration Date (as defined in Section 3).

(iv) Termination Under Other Circumstances. If your employment is
terminated under any circumstances not falling within one of the above clauses
(i)-(iii) of this subsection (c), then upon your termination of employment this
Option (A) will be exercisable only as to that number of shares as to which it has
become exercisable on or prior to the date your employment is terminated (and will
not become further exercisable thereafter), and (B) will expire on (and may be
exercised at any time on or before but not after) the earlier to occur of (1) the
date that is thirty (30) days after the date on which your employment terminated; or
(b) the Latest Expiration Date (as defined in Section 3).

(d) Adjustments by the Committee. The Committee may, in its discretion,
exercised before or after your termination of employment, declare all or any portion of your
Option immediately exercisable and/or permit all or any part of your Option to remain
exercisable for such period designated by it after the time when the Option would have
otherwise terminated as provided in the applicable portion of paragraph 7(a), but not beyond
the expiration date of your Option as set forth in paragraph 3 above.

 

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(e) Committee Determinations. For purposes of this Agreement and the Plan, the
Committee shall have absolute discretion to determine the date and circumstances of
termination of your employment, and its determination shall be final, conclusive and binding
upon you.

8. Restrictions on Option Exercise.

(a) Even though your Option is otherwise exercisable, your right to exercise the Option
will be suspended if the Committee determines that your exercise of the Option would violate
applicable laws or regulations. The suspension will last until the exercise would be
lawful. Any such suspension will not extend the term of your Option. The Company has no
obligation to register the Common Stock covered by your Option under federal or state
securities laws or to compensate you for any loss caused by the implementation of this
paragraph 8.

(b) Even though your Option is otherwise exercisable, the Committee may refuse to
permit such exercise if it determines, in its discretion, that any of the following
circumstances is present:

(i) the shares to be acquired upon such exercise are required to be registered
or qualified under any federal or state securities law, or to be listed on any
securities exchange or quotation system, and such registration, qualification, or
listing has not occurred;

(ii) the consent or approval of any government regulatory body is required or
desirable and has not been obtained;

(iii) an agreement by you with respect to the disposition of shares to be
acquired upon exercise of your Option is determined by the Committee to be necessary
or desirable in order to comply with any legal requirements and you have not
executed such agreement; or

(iv) the issuance, sale or delivery of any shares of Common Stock is or may in
the circumstances be unlawful under the laws or regulations of any applicable
jurisdiction.

9. Income Tax Withholding. In connection with the exercise of your Option, you will
be required to pay, or make other arrangements satisfactory to the Committee, to satisfy any
applicable tax withholding liability. You may elect to have the tax withholding obligation
satisfied by having the Company retain shares of Common Stock, otherwise deliverable to you upon
exercise of your Option, having a value equal to the amount of your withholding obligation. If you
fail to satisfy your tax withholding obligation in a time and manner satisfactory to the Committee,
the Company shall have the right to withhold the required amount from your salary or other amounts
payable to you.

Any election to have shares withheld must be made (in the manner acceptable to the Company) on
or before the date you exercise your Option.

 

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The amount of withholding tax paid by you to the Company will be paid to the appropriate
federal, state and local tax authorities in satisfaction of the withholding obligations under the
tax laws. The total amount of income you recognize by reason of exercise of the Option will be
reported to the appropriate taxing authorities in the year in which you recognize income with
respect to the exercise. Whether you owe additional tax will depend on your overall taxable income
for the applicable year and the total tax remitted for that year through withholding or by
estimated payments.

10. Non-transferability of Option. The Option granted to you by this Agreement may be
exercised only by you, and may not be assigned, pledged, or otherwise transferred by you, with the
exception that in the event of your death the Option may be exercised (at any time prior to its
expiration or termination as provided in paragraphs 3 and 7) by the executor or administrator of
your estate or by a person who acquired the right to exercise your Option by bequest or inheritance
or by the laws of descent and distribution.

11. Definitions. For purposes of this Agreement, the terms “Cause” and “Good Reason”
shall have the following meanings:

(a) “Cause” means:

(i) if the Employee is a party to a written employment agreement with the
Company or a Subsidiary that defines “cause” or a comparable term, the definition in
that employment agreement, and

(ii) if not, the Company’s good faith determination that the Employee has:

(1) failed or refused to comply fully and timely with any reasonable
instruction or order of the Company or applicable Subsidiary, provided that
such noncompliance is not based primarily on the Employee’s compliance with
applicable legal or ethical standards;

(2) 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 conduct that has the
potential to cause the Company or a Subsidiary or any of their respective
officers or directors embarrassment or ridicule;

(3) violated any applicable Company or Subsidiary policy or procedure,
including the Company’s Code of Ethical Business Conduct; or

(4) engaged in any act that is contrary to the best interests of or
would expose the Company, a Subsidiary, their related businesses, or any of
their respective officers or directors to probable civil or criminal
liability, excluding the Employee’s actions in accordance with applicable
legal and ethical standard.

 

-6-

 

(b) “Good Reason” means, if the Employee, at termination of employment, is a party to a
written employment agreement with the Company or a Subsidiary, the definition given to that
term or a comparable term in that agreement, if any.

12. Adjustment in Certain Events. In the event of any merger, reorganization,
consolidation, sale of substantially all assets, recapitalization, stock dividend, stock split,
spin-off, split-up, split-off, distribution of assets or other change in corporate structure
occurring after the effective date of this award, the Board shall adjust the number and kind of
shares of Common Stock covered by your Option, and the exercise price, to reflect the change and
such adjustment shall be conclusive and binding upon you and the Company.

13. Forfeiture. Your Option and any Common Stock acquired under the Plan and any gain
from the sale of any Common Stock acquired under the Plan are required to be forfeited by you,
including after exercise or vesting, if, during your employment or within one (1) year following
your termination of employment (or any longer period specified in any applicable employment or
severance agreement with the Company), you engage in Disqualifying Conduct, which shall mean: (i)
your performance of service (including service as an employee, director, or consultant) for a
competitor of the Company or its Subsidiaries or the establishing by you of a business which
competes with the Company or its Subsidiaries; (ii) your solicitation of employees or customers of
the Company or its Subsidiaries; (iii) your improper use or disclosure of confidential information
of the Company or its Subsidiaries; or (iv) your material misconduct in the performance of your
duties for the Company or its Subsidiaries, as determined by the Committee.

14. No Guarantee of Employment. The grant of this Option does not constitute an
assurance of continued employment for any period or in any way interfere with the Company’s right
to terminate your employment or to change the terms and conditions of your employment.

15. Other Plans. You acknowledge that any income derived from your Option (or the
sale of Common Stock underlying your Option) will not affect your participation in, or benefits
under, any other benefit plan maintained by the Company.

16. Administration. The Committee has the sole power to interpret the Plan and this
Agreement and to act upon all matters relating to Options granted under the Plan. Any decision,
determination, interpretation, or other action taken pursuant to the provisions of the Plan by the
Committee shall be final, binding, and conclusive.

17. Amendment. The Committee may from time to time amend the terms of this grant in
accordance with the terms of the Plan in effect at the time of such amendment, but no amendment
which is unfavorable to you can be made without your written consent.

 

-7-

 

IN WITNESS WHEREOF the Company and you have executed this Agreement effective as of the Grant
Date.

	 	 	 	 	 	 	 	 	 
	ACCEPTED BY EMPLOYEE:	 	HILLENBRAND, INC.	 	 
	 
	By: 
	 	 	 	By: 	 	 	 	 
	 

	 

	 	 	 

	 	 
	 	Printed:

	 	 	 	Title:	 	 	 
	 

	 	 

	 	 	 	 

	 	 
	 

	 	 	 	 	Printed:	 	 	 
	 

	 	 	 	 	 	 

	 	 

 

-8-

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