Exhibit 10.01

Cardinal Health, Inc.

Long-Term Incentive Cash Program for Fiscal Years 2006-2008

Article 1. Establishment and Purpose

     1.1. Establishment of Program . The Cardinal Health, Inc. Long-Term Incentive Cash Program for Fiscal Years 2006-2008 (the “Program”) is hereby established effective as of July 1, 2005, under Section 13 of the Cardinal Health, Inc. 2005 Long-Term Incentive Plan (the “2005 LTIP”). The Program is subject to the terms and provisions of the 2005 LTIP and shall remain in effect until October 31, 2008, or earlier termination by the Administrator of either this Program or the 2005 LTIP.

     1.2. Purpose . The primary purposes of the Program are to:

     (a) Achieve the Company’s long term growth objectives relative to earnings per share;

     (b) Focus management on key measures that drive superior financial and management performance and that result in enhanced value of the Company;

     (c) Provide compensation opportunities that are externally competitive and internally consistent with the Company’s growth objectives and total compensation strategies; and

     (d) Provide award opportunities that reward executives with financial and operating responsibilities that can impact achievement of the Company’s growth goals.

Article 2. Definitions

     Whenever used in the Program, capitalized terms that are defined in the 2005 LTIP shall have the meanings attributed to them in the 2005 LTIP. In addition, the following terms shall have the meanings set forth below and, when the defined meaning is intended, the term is capitalized:

     2.1. “Covered Employee” means any Participant who is, or who is determined by the Committee to be likely to become, a “covered employee” within the meaning of Code Section 162(m).

     2.2. “Effective Date” means July 1, 2005.

     2.3. “Final Award” means the actual incentive compensation earned during a Performance Period by a Participant, as determined by the Administrator following the end of the Performance Period.

     2.4. “Performance Period” means the three fiscal year period beginning on the Effective Date and ending on June 30, 2008.

Article 3. Eligibility and Participation

     3.1. Eligibility . The Administrator shall designate the key executive Employees who are eligible to receive a Cash Award under the Program. In general, an Employee may be designated as a key Employee if such Employee is a strategic executive who is responsible for or contributes to the management, growth, and/or profitability of the business of the Company in a material way. Only the Committee may determine the eligibility of Employees who are Covered Employees.

     3.2. Participation . Employees who were chosen to participate in the Program shall be apprised of the performance criteria and related Cash Awards determined for them for the Performance Period, as soon as is practicable after such Cash Awards are established.

     3.3. Partial Performance Period Participation . An Employee who becomes eligible after the beginning of the Performance Period may participate in the Program for that Performance Period on a ratable basis. Such situations may include, but are not limited to (a) new hires; or (b) when an Employee is promoted from a position which did not previously meet the eligibility criteria. The Administrator, in its sole discretion, retains the right to prohibit or allow participation for any of the aforementioned Employees. The performance criteria previously established under the Program shall apply to any Employees who become eligible after the beginning of the Performance Period. If an Employee participates for only a portion of the Performance Period for any reason, his or her Cash Award will be pro-rated based on the number of days he or she performed services during the Performance Period over the total days in the Performance Period, or some similar method adopted by the Committee that results in a ratable reduction of the Cash Award based on the partial Performance Period applicable to the Employee. In addition, in the event a Participant changes job levels during a Performance Period, the Participant’s Cash Award may be adjusted to reflect the amount of time at each job level during the Performance Period. Notwithstanding anything in this Section 3.3 or in the Program to the contrary, the participation in the Program for a Covered Employee who becomes eligible after the beginning of the Performance Period shall comply with the provisions of Code Section 162(m), as set forth in Section 4.1.

     3.4. No Right to Participate . No Participant or other Employee shall at any time have a right to be selected for participation in the Program for any Performance Period, whether or not he or she previously participated in this or any similar Program.

Article 4. Award Determination

     4.1. Qualifying Performance Criteria . The Committee selected and established in writing performance criteria for the Performance Period, which, if met, may entitle Participants to the payment of the Cash Awards. To ensure compliance with the exception from Code Section 162(m) for qualified performance-based compensation for Participants who are Covered Employees, the performance criteria established were (and will be for any new Participants who are Covered Employees) based on one or more Qualifying Performance Criteria selected by the Committee in writing within 90 days following the first day of the period of service of such Employee as a Participant under the Program (or, if earlier, before 25% of that period has elapsed), and at a time when the outcome relative to the attainment of the performance criteria is not substantially certain. Subject to the requirements of Code Section 162(m) with respect to Covered Employees, if a Participant commences participation after the beginning of a Performance Period, the performance criteria established for the Performance Period shall apply to that Participant, with the Cash Award amount adjusted or pro-rated over the remaining balance of the Performance Period to reflect the partial period of participation in the Program. Once established, the performance criteria shall not be changed during the Performance Period. Subject to the requirements of Code Section 162(m) with respect to Covered Employees, at the time the Cash Awards are made and performance criteria are established, the Committee is authorized to determine the manner in which the performance criteria will be calculated or measured to take into account certain factors over which Participants have no or limited control, including, but not limited to, market related changes in inventory value, changes in industry margins, changes in accounting principles, and extraordinary charges to income.

     4.2. Cash Award Targets . The Committee has established in writing a Cash Award target for each Covered Employee and for all other Participants for the Performance Period. Participants who are Covered Employees may receive a Cash Award solely if the Qualifying Performance Criteria are met.

     4.3. Final Award Determinations . At the end of the Performance Period, the Committee shall certify in writing the extent to which the Qualifying Performance Criteria were met during the Performance Period for any Cash Awards for Covered Employees. If the Qualifying Performance Criteria for the Performance Period are met, Covered Employees shall be entitled to the payment of the Cash Awards, subject to the Committee’s exercise of negative discretion to reduce any Final Award payable to a Covered Employee based on business objectives established for that Covered Employee or other factors as determined by the Committee in its sole discretion. As set forth in the 2005 LTIP, the maximum amount payable to any single Participant pursuant to the portion of a Cash Award earned with respect to any single fiscal year shall not exceed $7,500,000. With respect to Participants who are not Covered Employees, the Committee will determine the Final Award based on the performance criteria and other business objectives. The Committee may adjust (either up or down) any Final Award for Participants who are not Covered Employees on the basis of such further considerations as the Committee shall determine in its sole discretion.

Article 5. Payment of Final Awards

     Each Participant’s Final Award shall be paid in cash, in one lump sum, subject to applicable tax withholding, on or before the 15 ^th day of the third month after the end of each Performance Period. If payment is delayed due to an unforeseeable event or other administrative delays, payment shall in no event be made later than the 15 ^th day of the third month after the end of the taxable year of the Participant in which the Final Award was earned. The Administrator may permit or provide for deferred payment of any Final Award to a specified date or to a date not less than six (6) months after termination of employment, in accordance with such conditions and procedures as the Administrator may specify in compliance with the requirements of Code Section 409A.

Article 6. Termination of Employment; Other Forfeiture Events

     6.1. Termination of Employment Due to Death or Disability . In the event a Participant’s employment is terminated by reason of death or Disability, the Final Award determined in accordance with Section 4.3 herein shall be reduced to reflect participation prior to termination of employment only. The Final Award, if any, shall be calculated based on a determination of the achievement of the performance criteria and business objectives as of the end of the fiscal year quarter in which the Participant’s termination of employment occurred. The Cash Award so determined shall be further reduced by multiplying the Final Award by a fraction, the numerator of which is the number of days of employment in the Performance Period through the date of employment termination, and the denominator of which is the number of days in the Performance Period. In the case of a Participant’s Disability, the employment termination shall be deemed to have occurred as of the date that the Committee determines was the date on which the definition of Disability was satisfied. The Final Award thus determined shall be paid as soon as practicable and reasonable following the end of the Performance Period in which employment termination occurs, but in no event shall such amount be paid later than the 15 ^th day of the third month after the end of the taxable year of the Participant in which the Performance Period ended.

     6.2. Beneficiary Designations .

     (a) General. Each Participant under the Program may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Program is to be paid in case of his or her death before such Participant receives any or all of such benefit. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Administrator, and will be effective only when filed by the Participant in writing with the Administrator during his or her lifetime.

     (b) Invalidity of Powers of Attorney. The Program shall not recognize beneficiary designations made on a Participant’s behalf by the Participant’s attorney in fact, or by any person acting under a power of attorney or any instrument by which the Participant has appointed another person as his or her agent, thereby conferring upon him or her the authority to perform certain specified acts on the Participant’s behalf.

     (c) Failure of Beneficiary Designation. In the absence of a beneficiary designation made by the Participant in accordance with Section 6.2(a), or if the beneficiary named by a Participant predeceases him or her, then the Administrator shall pay any benefits remaining unpaid at the Participant’s death to the Participant’s estate.

     6.3. Termination of Employment Following a Change in Control . In the event of a Change in Control, all Participants shall become vested in and entitled to their Cash Awards calculated based on their individual target awards times a fraction, the numerator of which is the number of days from the beginning of the Performance Period to the date of the Change in Control and the denominator of which is the total number of days in the Performance Period. The amount so calculated shall be the minimum amount payable as a Final Award for the Performance Period in which the Change in Control occurs. If the Participant’s employment is terminated before the last date of a Performance Period and within two (2) years of a Change in Control for any reason other than a Termination for Cause, the Final Award thus determined shall be paid as soon as practicable and reasonable following the Participant’s Termination of Employment, but in no event shall such amount be paid later than the 15 ^th day of the third month after the end of the taxable year of the Participant in which the Termination of Employment occurred.

     6.4. Termination of Employment for Other Reasons . In the event of a Participant’s Termination of Employment before the last date of a Performance Period for any reason other than death or Disability, all of the Participant’s rights to any Final Award for that Performance Period shall be forfeited. In addition, the Administrator may also, in its sole discretion, determine and provide that all or any portion of a Final Award is subject to an obligation of repayment to the Company in the event of a Termination for Cause of the Participant within a specified period after a Final Award is earned.

     6.5. Other Forfeiture Events . The Administrator may, in its discretion, require that all or any portion of a Final Award is subject to an obligation of repayment to the Company upon the violation of a non-competition and confidentiality covenant applicable to the Participant. The Administrator may, in its discretion, also require repayment to the Company of all or any portion of a Final Award if the amount of the Final Award was calculated based upon the achievement of certain financial results that were subsequently the subject of a financial statement restatement, the Participant engaged in misconduct that caused or contributed to the need for the financial statement restatement, and the amount of the Final Award would have been lower than the amount actually awarded to the Participant had the financial results been properly reported. This Section 6.4 shall not be the Company’s exclusive remedy with respect to such matters. This Section 6.4 shall not apply after a Change of Control.

Article 7. Nontransferability

     No right or interest of any Participant in the Program shall be assignable or transferable, other than by will or pursuant to the laws of descent and distribution, or subject to any lien, directly, by operation of law or otherwise, including, but not limited to, by execution, levy, garnishment, attachment, pledge, or bankruptcy.

Article 8. Administration

     8.1. General . The Program shall be administered in accordance with Section 4 of the 2005 LTIP.

     8.2. Facility of Payment . If the Administrator deems any person entitled to receive any amount under the provisions of the Program to be incapable of receiving or disbursing the same by reason of minority, illness or infirmity, mental incompetence, or incapacity of any kind, the Administrator may, in its sole discretion, (i) apply such amount directly for the comfort, support and maintenance of such person; (ii) reimburse any person for any such support theretofore supplied to the person entitled to receive any such payment; (iii) pay such amount to any person selected by the Administrator to disburse it for such comfort, support and maintenance, including without limitation, any relative who has undertaken, wholly or partially, the expense of such person’s comfort, care and maintenance, or any institution in whose care or custody the person entitled to the amount may be; or (iv) with respect to any amount due to a minor, deposit such amount to his or her credit in any savings or commercial bank of the Administrator’s choice, direct that such distribution be paid to the legal guardian, or if none, to a parent of such person or a responsible adult with whom the minor maintains his or her residence, or to the custodian for such person under the Uniform Gift to Minors Act or Gift to Minors Act, if such payment is permitted by the laws of the state in which the minor resides. Payment pursuant to this Section 8.2 shall fully discharge the Company, the Board, the Committee, and the Program from further liability on account thereof.

Article 9. Amendment or Termination

     The Administrator, without notice, at any time and from time to time, may modify or amend, in whole or in part, any or all of the provisions of the Program, or suspend or terminate it entirely, in accordance with the provisions of the 2005 LTIP. No Cash Award may be granted during any period of suspension of the Program or after termination of the Program, and in no event may any new Cash Award be granted after the termination or expiration of the 2005 LTIP under which this Program is established.

Article 10. Miscellaneous

     Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of the Program. Any reference to a section (other than to a section of the Program) shall also include a successor to such section. The Program is governed by the 2005 LTIP and shall be construed in accordance therewith. In the event any term or provision of the Program conflicts with any term or provision of the 2005 LTIP, the terms and provisions of the 2005 LTIP shall control.

		Cardinal Health, Inc.
		By:		/s/ Carole S. Watkins
		Title: Chief Human Resources Officer

Exhibit 10.02

[ON CARDINAL HEALTH LETTERHEAD]

August 3, 2006

Mr. Jeffrey W. Henderson
[ number and street ]
[ city, state, zip ]

Subject: Amendment to Employment Offer Letter Agreement (“Letter Agreement”)

Dear Jeff:

The purpose of this letter is to supplement and amend the Letter Agreement signed by you and Cardinal Health, Inc. (the “Company”) dated April 13, 2005, in accordance with resolutions approved by the Human Resources and Compensation Committee of the Board of Directors at its meeting on August 1, 2006. The following are the additional or revised terms governing your employment by the Company:

     1. In addition to the options and restricted share unit awards under paragraph 4 of the Letter Agreement, you will be granted 8,000 Restricted Share Units (RSUs) pursuant to the stock awards feature of the 2005 Long-Term Incentive Plan, as amended (the “LTIP”) effective as of August 15, 2006. The 8,000 RSUs will not require payment of any purchase price for the shares and will vest in three equal annual installments of one-third each year beginning on the first anniversary of the grant date, consistent with the terms of such grant and the Company’s customary practices for senior executives.

     2. Paragraph 11 of the Letter Agreement is amended by adding the following after the first sentence: “If your employment is involuntarily terminated by the Company without cause between August 30, 2007 and April 17, 2008, in lieu of the severance provided in the preceding sentence, you will receive a lump sum cash payment within no more than 2 ¹ / 2 months after your termination date equal to the sum of your annual base salary at the rate in effect on the date of termination and your annual bonus target for the Company’s 2008 fiscal year; in addition, your option to purchase 48,077 shares of the Company’s stock (granted on April 18, 2005) and 15,000 of the RSUs granted under paragraph 4 of the Letter Agreement that are then unvested shall become immediately vested. These severance benefits are subject to the Company’s Policy Regarding Shareholder Approval of Severance Agreements (the “Policy”), which requires shareholder approval of certain agreements to provide “Severance Benefits” that exceed 2.99 times “Base Salary” and “Bonus,” as such terms are defined in the Policy. If the severance benefits herein require shareholder approval under the Policy, you agree that the benefits under this provision will be reduced to an amount not exceeding 2.99 times “Base Salary” and “Bonus” unless such approval is obtained.”

     In addition, the following is added to paragraph 11 of the Letter Agreement before the last sentence of that paragraph: “You may also voluntarily resign from your employment with the Company by providing written notice of such resignation within the 10 days immediately following June 30, 2007, effective 60 days after the date of the notice. Provided that the Company does not have grounds to terminate your employment for gross misconduct at the time of the notice or during the 60 day period thereafter, you will receive a lump sum cash payment within no more than 2 ¹ / 2 months after your termination date equal to the sum of your annual base salary at the rate in effect on the date of termination and your annual bonus target for the

Company’s 2008 fiscal year; in addition, 15,000 of the RSUs granted under paragraph 4 of the Letter Agreement that are then unvested shall become immediately vested.”

     3. Except as specifically amended by the provisions of this amendment, all terms of the Letter Agreement are unmodified and remain in full force and effect.

My signature below represents the Company’s agreement to these amendments to the Letter Agreement. Please sign where indicated below to accept and agree to this amendment to your Letter Agreement.

Sincerely,

/s/ R. Kerry Clark

R. Kerry Clark
President and Chief Executive Officer

I accept and agree to the above amendment to my Letter Agreement:

/s/ Jeffrey W. Henderson       

JEFFREY W. HENDERSON

Date: August 5, 2006

Exhibit 10.03

CARDINAL HEALTH, INC.
NONQUALIFIED STOCK OPTION AGREEMENT

     On [date of grant] (the “Grant Date”), Cardinal Health, Inc., an Ohio corporation (the “Company”), has awarded to [employee name] (“Awardee”), an option (the “Option”) to purchase [# of shares] common shares, without par value, of the Company (the “Shares”) for a price of [$X.XX] per share. The Option has been granted under the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and will include and be subject to all provisions of the Plan, which are incorporated herein by reference, and will be subject to the provisions of this agreement. Capitalized terms used in this agreement which are not specifically defined will have the meanings ascribed to such terms in the Plan. This Option shall vest and become exercisable [CLIFF ALTERNATIVE: on [vesting date]] [INSTALLMENT ALTERNATIVE: in accordance with the following schedule: [vesting schedule], subject [INSTALLMENT ALTERNATIVE: in each case] to the provisions of this agreement, including those relating to the Awardee’s continued employment with the Company and its Affiliates. Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Option shall vest in full. This Option shall expire on [date of expiration] (the “Grant Expiration Date”).

1. Method of Exercise and Payment of Price .

(a) Method of Exercise . At any time when all or a portion of the Option is exercisable under the Plan and this agreement, some or all of the exercisable portion of the Option may be exercised from time to time by written notice to the Company, or such other method of exercise as may be specified by the Company, including without limitation, exercise by electronic means on the web site of the Company’s third-party equity plan administrator, which will:

     (i) state the number of Shares with respect to which the Option is being exercised; and

     (ii) if the Option is being exercised by anyone other than Awardee, if not already provided, be accompanied by proof satisfactory to counsel for the Company of the right of such person or persons to exercise the Option under the Plan and all applicable laws and regulations.

(b) Payment of Price . The full exercise price for the portion of the Option being exercised shall be paid to the Company as provided below:

     (i) in cash;

     (ii) by check or wire transfer (denominated in U.S. Dollars);

     (iii) subject to any conditions or limitations established by the Administrator, other Shares which (A) in the case of Shares acquired from the Company (whether upon the exercise of an Option or otherwise), have been owned by the Participant for more than six months on the date of surrender (unless this condition is waived by the Administrator), and (B) have a Fair Market Value on the date of surrender equal to or greater than the aggregate exercise price of the Shares as to which said Option shall be exercised (it being agreed that the excess of the Fair Market Value over the aggregate exercise price shall be refunded to the Awardee in cash);

     (iv) consideration received by the Company under a broker-assisted sale and remittance program acceptable to the Administrator; or

     (v) any combination of the foregoing methods of payment.

2. Transferability . The Option shall be transferable (I) at Awardee’s death, by Awardee by will or pursuant to the laws of descent and distribution, and (II) by Awardee during Awardee’s lifetime, without payment of consideration, to (a) the spouse, former spouse, parents, stepparents, grandparents, parents-in-law, siblings, siblings-in-law, children, stepchildren, children-in-law, grandchildren, nieces or nephews of Awardee, or any other persons sharing Awardee’s household (other than tenants or employees) (collectively, “Family Members”), (b) a trust or trusts for the primary benefit of Awardee or such Family Members, (c) a foundation in which Awardee or such Family Members control the management of assets, or (d) a partnership in which Awardee or such Family Members are the majority or controlling partners; provided, however, that subsequent transfers of the transferred Option shall be prohibited, except (X) if the transferee is an individual, at the transferee’s death by the transferee by will or pursuant to the laws of descent and distribution, and (Y) without payment of consideration to the individuals or entities listed in subparagraphs II(a), (b) or (c), above, with respect to the original Awardee. The Administrator may, in its discretion, permit transfers to other persons and entities as permitted by the Plan. Neither a transfer under a domestic relations order in settlement of marital property rights nor a transfer to an entity in which more than 50% of the voting interests are owned by Awardee or Family Members in exchange for an interest in that entity shall be considered to be a transfer for consideration. Within 10 days of any transfer, Awardee shall notify the Compensation and Benefits department of the Company in writing of the transfer. Following transfer, the Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer and, except as otherwise provided in the Plan or this agreement, references to the original Awardee shall be deemed to refer to the transferee. The events of a Termination of Employment of Awardee provided in paragraph 3 hereof shall continue to be applied with respect to the original Awardee, following which the Option shall be exercisable by the transferee only to the extent, and for the periods, specified in paragraph 3. The Company shall have no obligation to notify any transferee of Awardee’s Termination of Employment with the Company for any reason. The conduct prohibited of Awardee in paragraphs 5 and 6 hereof shall continue to be prohibited of Awardee following transfer to the same extent as immediately prior to transfer and the Option (or its economic value, as applicable) shall be subject to forfeiture by the transferee and recoupment from Awardee to the same extent as would have been the case of Awardee had the Option not been transferred. Awardee shall remain subject to the recoupment provisions of paragraphs 5 and 6 of this agreement and tax withholding provisions of Section 29 of the Plan following transfer of the Option.

3. Termination of Employment .

(a) Termination of Employment by Reason of Death . If a Termination of Employment occurs by reason of death prior to the vesting in full of the Option, then any unvested portion of the Option shall vest upon and become exercisable in full from and after such death. The Option may thereafter be exercised by any transferee of Awardee, if applicable, or by the legal representative of the estate or by the legatee of Awardee under the will of Awardee for a period of one year from the date of death or until the Grant Expiration Date, whichever period is shorter.

(b) Termination of Employment by Reason of Retirement or Disability . If a Termination of Employment occurs by reason of Retirement or Disability prior to the vesting in full of the

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Option, then any unexercised portion of the Option which has not vested on such date of Termination of Employment will automatically be forfeited. The Option, to the extent vested, may be exercised by Awardee (or any transferee, if applicable) until the earlier of the fifth anniversary of the date of such Retirement or Disability or the Grant Expiration Date, provided that if Awardee has at least 15 years of service with the Company and its Affiliates (collectively, the “Cardinal Group”) at the time of Retirement, the Option, to the extent vested, may be exercised by Awardee (or any transferee, if applicable) until the Grant Expiration Date. Notwithstanding the foregoing, if Awardee dies after Retirement or Disability, but before the expiration of the exercise period provided for by the preceding sentence, the Option, to the extent vested, may be exercised by any transferee of the Option, if applicable, or by the legal representative of the estate or by the legatee of Awardee under the will of Awardee from and after such death only until the earlier of (x) the first anniversary of the date of death or (y) the date upon which such exercise period would have otherwise expired.

(c) Other Termination of Employment . If a Termination of Employment occurs by any reason other than death, Retirement or Disability, any unexercised portion of the Option which has not vested on such date of Termination of Employment will automatically be forfeited. Subject to Section 16(b)(ii) of the Plan, Awardee (or any transferee, if applicable) will have 90 days from the date of Termination of Employment or until the Grant Expiration Date, whichever period is shorter, to exercise any portion of the Option that is vested and exercisable on the date of Termination of Employment; provided, however, that if the Termination of Employment was a Termination for Cause, as determined by the Administrator, the Option may be immediately canceled by the Administrator (whether then held by Awardee or any transferee).

4. Restrictions on Exercise . The Option is subject to all restrictions in this agreement and/or in the Plan. As a condition of any exercise of the Option, the Company may require Awardee or his or her transferee or successor to make any representation and warranty to comply with any applicable law or regulation or to confirm any factual matters (including Awardee’s compliance with the terms of paragraphs 5 and 6 of this agreement or any employment or severance agreement between the Cardinal Group and Awardee) reasonably requested by the Company.

5. Triggering Conduct/Competitor Triggering Conduct . As used in this agreement, “Triggering Conduct” shall include the following: disclosing or using in any capacity other than as necessary in the performance of duties assigned by the Cardinal Group any confidential information, trade secrets or other business sensitive information or material concerning the Cardinal Group; violation of Company policies, including conduct which would constitute a breach of any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies signed by Awardee; directly or indirectly employing, contacting concerning employment, or participating in any way in the recruitment for employment of (whether as an employee, officer, director, agent, consultant or independent contractor), any person who was or is an employee, representative, officer or director of the Cardinal Group at any time within the 12 months prior to Awardee’s Termination of Employment; any action by Awardee and/or his or her representatives that either does or could reasonably be expected to undermine, diminish or otherwise damage the relationship between the Cardinal Group and any of its customers, potential customers, vendors and/or suppliers that were known to Awardee; and breaching any provision of any employment or severance agreement with a member of the Cardinal Group. As used in this agreement, “Competitor Triggering Conduct” shall include, either during Awardee’s employment or within one year following Awardee’s Termination of Employment, accepting employment with, or serving as a consultant

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or advisor or in any other capacity to, an entity that is in competition with the business conducted by any member of the Cardinal Group (a “Competitor”), including, but not limited to, employment or another business relationship with any Competitor if Awardee has been introduced to trade secrets, confidential information or business sensitive information during Awardee’s employment with the Cardinal Group and such information would aid the Competitor because the threat of disclosure of such information is so great that, for purposes of this agreement, it must be assumed that such disclosure would occur.

6. Special Forfeiture/Repayment Rules . For so long as Awardee continues as an employee with the Cardinal Group and for three years following Termination of Employment regardless of the reason, Awardee agrees not to engage in Triggering Conduct. If Awardee engages in Triggering Conduct during the time period set forth in the preceding sentence or in Competitor Triggering Conduct during the time period referenced in the definition of “Competitor Triggering Conduct” set forth in paragraph 5 above, then:

(a) the Option (or any part thereof that has not been exercised) shall immediately and automatically terminate, be forfeited, and shall cease to be exercisable at any time; and

(b) Awardee shall, within 30 days following written notice from the Company, pay the Company an amount equal to the gross option gain realized or obtained by Awardee or any transferee resulting from the exercise of such Option, measured at the date of exercise (i.e., the difference between the market value of the Shares underlying the Option on the exercise date and the exercise price paid for such Shares underlying the Option), with respect to any portion of the Option that has already been exercised at any time within three years prior to the Triggering Conduct (the “Look-Back Period”), less $1.00. If Awardee engages only in Competitor Triggering Conduct, then the Look-Back Period shall be shortened to exclude any period more than one year prior to Awardee’s Termination of Employment, but including any period between the time of Termination of Employment and engagement in Competitor Triggering Conduct. Awardee may be released from Awardee’s obligations under this paragraph 6 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Nothing in this paragraph 6 constitutes a so-called “noncompete” covenant. This paragraph 6 does, however, prohibit certain conduct while Awardee is associated with the Cardinal Group and thereafter and does provide for the forfeiture or repayment of the benefits granted by this agreement under certain circumstances, including, but not limited to, Awardee’s acceptance of employment with a Competitor. Awardee agrees to provide the Company with at least 10 days written notice prior to directly or indirectly accepting employment with or serving as a consultant or advisor or in any other capacity to a Competitor, and further agrees to inform any such new employer, before accepting employment, of the terms of this paragraph 6 and Awardee’s continuing obligations contained herein. No provisions of this agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this agreement, the provisions of this agreement shall take precedence and such other inconsistent provisions shall be null and void. Awardee acknowledges and agrees that the restrictions contained in this agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Option, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which

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consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Option and execution of this agreement are voluntary actions on the part of Awardee and that the Company is unwilling to provide the Option to Awardee without including the restrictions and covenants of Awardee contained in this agreement. Further, the parties agree and acknowledge that the provisions contained in paragraphs 5 and 6 are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made.

7. Right of Set-Off . By accepting this Option, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this agreement.

8. Withholding Tax .

(a) Generally . Awardee is liable and responsible for all taxes owed in connection with the exercise of the Option, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Option. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the exercise of the Option. The Company does not commit and is under no obligation to structure the Option or the exercise of the Option to reduce or eliminate Awardee’s tax liability.

(b) Payment of Withholding Taxes . Concurrently with the payment of the exercise price pursuant to paragraph 1 hereof, Awardee is required to arrange for the satisfaction of the minimum amount of any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”) in a manner acceptable to the Company. Any manner provided for in subparagraph 1(b) hereof shall be deemed an acceptable manner to satisfy the Tax Withholding Obligation unless otherwise determined by the Company.

9. Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Option, Awardee hereby agrees to hold his or her After-Tax Net Profit in Shares until the first anniversary of the exercise of all or a portion of the Option (or, if earlier, the date of Awardee’s Termination of Employment). “After-Tax Net Profit” means the total dollar value of the Shares that Awardee elects to exercise under this Option at the time of exercise, minus the total of (i) the exercise price to purchase these Shares, and (ii) the amount of all applicable federal, state, local or foreign income, employment or other tax and other similar fees that are withheld in connection with the exercise.

10. Governing Law/Venue . This agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superceded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a substantial relationship to the parties and/or this agreement and that the Option and benefits granted herein would not be granted without the governance of this agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this agreement shall be brought in state or federal courts located in Franklin County, Ohio and the parties executing this agreement hereby consent to the personal jurisdiction of such courts. Awardee acknowledges that the covenants contained in paragraphs 5 and 6 of this agreement are

5

reasonable in nature, are fundamental for the protection of the Company’s legitimate business and proprietary interests, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law. In the event of any violation or attempted violations of the restrictions and covenants of Awardee contained in this agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to institute legal proceedings under this agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings. Any provision of this agreement which is determined by a court of competent jurisdiction to be invalid or unenforceable should be construed or limited in a manner that is valid and enforceable and that comes closest to the business objectives intended by such provision, without invalidating or rendering unenforceable the remaining provisions of this agreement.

11. Action by the Administrator . The parties agree that the interpretation of this agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this agreement and with regard to any and all matters set forth in this agreement. The Administrator may delegate its functions under this agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “designee”). In fulfilling its responsibilities hereunder, the Administrator or its designee may rely upon documents, written statements of the parties or such other material as the Administrator or its designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its designee and that any decision of the Administrator or its designee relating to this agreement, including without limitation whether particular conduct constitutes Triggering Conduct or Competitor Triggering Conduct, shall be final and binding unless such decision is arbitrary and capricious.

12. Prompt Acceptance of Agreement . The Option grant evidenced by this agreement shall, at the discretion of the Administrator, be forfeited if this agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

13. Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Option grant under and participation in the Plan or future options that may be granted under the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of option grants and the execution of option agreements through electronic signature.

14. Notices . All notices, requests, consents and other communications required or provided under this agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or

certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

Awardee hereby: (a) acknowledges receiving a copy of the Plan, which has either been previously delivered or is provided with this agreement, and represents that he or she is familiar with and understands all provisions of the Plan and this agreement; (b) voluntarily and knowingly accepts this agreement and the Option granted to him or her under this agreement subject to all provisions of the Plan and this agreement, including the provisions in the agreement regarding “Triggering Conduct/Competitor Triggering Conduct” and “Special Forfeiture/
Repayment Rules” set forth in paragraphs 5 and 6 above; and (c) represents that he or she understands that the acceptance of this agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he or she manually signed the agreement. Awardee further acknowledges receiving a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders and a copy of the Plan Description dated [date of Plan Description] pertaining to the Plan.

		[
		Awardee’s Signature
		Awardee’s Social Security Number
		Date]

Exhibit 10.04

CARDINAL HEALTH, INC.
RESTRICTED SHARE UNITS AGREEMENT

     On [grant date] (the “Grant Date”), Cardinal Health, Inc, an Ohio corporation (the “Company”), has awarded to [employee name] (“Awardee”) [# of shares] Restricted Share Units (the “Restricted Share Units” or “Award”), representing an unfunded unsecured promise of the Company to deliver common shares, without par value, of the Company (the “Shares”) to Awardee as set forth herein. The Restricted Share Units have been granted pursuant to the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and shall be subject to all provisions of the Plan, which are incorporated herein by reference, and shall be subject to the provisions of this Restricted Share Units Agreement (this “Agreement”). Capitalized terms used in this Agreement which are not specifically defined shall have the meanings ascribed to such terms in the Plan.

     1.  Vesting . Subject to the provisions set forth elsewhere in this Agreement, the Restricted Share Units shall vest [CLIFF VESTING ALTERNATIVE: on [vesting date] (the “Vesting Date”)] [INSTALLMENT VESTING ALTERNATIVE: in accordance with the following schedule: [vesting schedule] (each such vesting date, the “Vesting Date” with respect to the Restricted Share Units scheduled to vest on such date)]. Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Restricted Share Units shall vest in full.

     2.  Transferability . The Restricted Share Units shall not be transferable.

     3.  Termination of Employment . Except as set forth below, if a Termination of Employment occurs prior to the vesting of a Restricted Share Unit, such Restricted Share Unit shall be forfeited by Awardee. If a Termination of Employment occurs prior to the vesting in full of the Restricted Share Units by reason of Awardee’s death, then any unvested Restricted Share Units shall vest in full and shall not be forfeited.

     4. Triggering Conduct/Competitor Triggering Conduct . As used in this Agreement, “Triggering Conduct” shall include the following: disclosing or using in any capacity other than as necessary in the performance of duties assigned by the Company and its Affiliates (collectively, the “Cardinal Group”) any confidential information, trade secrets or other business sensitive information or material concerning the Cardinal Group; violation of Company policies, including conduct which would constitute a breach of any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies signed by Awardee; directly or indirectly employing, contacting concerning employment, or participating in any way in the recruitment for employment of (whether as an employee, officer, director, agent, consultant or independent contractor), any person who was or is an employee, representative, officer or director of the Cardinal Group at any time within the 12 months prior to Awardee’s Termination of Employment; any action by Awardee and/or his or her representatives that either does or could reasonably be expected to undermine, diminish or otherwise damage the relationship between the Cardinal Group and any of its customers, potential customers, vendors and/or suppliers that were known to Awardee; and breaching any provision of any employment or severance agreement with a member of the Cardinal Group. As used in this Agreement, “Competitor Triggering Conduct” shall include, either during Awardee’s employment or within one year following Termination of Employment, accepting employment with or serving as a consultant or advisor or in any other capacity to an entity that is in competition with the business conducted by any member of the Cardinal Group (a “Competitor”), including, but not limited to, employment or another business relationship with any Competitor if Awardee has been introduced to trade secrets, confidential information or business sensitive information during Awardee’s employment

with the Cardinal Group and such information would aid the Competitor because the threat of disclosure of such information is so great that, for purposes of this Agreement, it must be assumed that such disclosure would occur.

     5.  Special Forfeiture/Repayment Rules . For so long as Awardee continues as an Employee with the Cardinal Group and for three years following Termination of Employment regardless of the reason, Awardee agrees not to engage in Triggering Conduct. If Awardee engages in Triggering Conduct during the time period set forth in the preceding sentence or in Competitor Triggering Conduct during the time period referenced in the definition of “Competitor Triggering Conduct” set forth in Paragraph 4 above, then:

     (a) any Restricted Share Units that have not yet vested or that vested within the Look-Back Period (as defined below) with respect to such Triggering Conduct or Competitor Triggering Conduct and have not yet been settled by a payment pursuant to Paragraph 6 hereof shall immediately and automatically terminate, be forfeited, and cease to exist; and

     (b) Awardee shall, within 30 days following written notice from the Company, pay to the Company an amount equal to (x) the aggregate gross gain realized or obtained by Awardee resulting from the settlement of all Restricted Share Units pursuant to Paragraph 6 hereof (measured as of the settlement date (i.e., the market value of the Restricted Share Units on such settlement date)) that have already been settled and that had vested at any time within three years prior to the Triggering Conduct (the “Look-Back Period”), minus (y) $1.00. If Awardee engages only in Competitor Triggering Conduct, then the Look-Back Period shall be shortened to exclude any period more than one year prior to Awardee’s Termination of Employment, but including any period between the time of Termination of Employment and the time of Awardee’s engaging in Competitor Triggering Conduct.

     Awardee may be released from his or her obligations under this Paragraph 5 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Nothing in this Paragraph 5 constitutes a so-called “noncompete” covenant. This Paragraph 5 does, however, prohibit certain conduct while Awardee is associated with the Cardinal Group and thereafter and does provide for the forfeiture or repayment of the benefits granted by this Agreement under certain circumstances, including, but not limited to, Awardee’s acceptance of employment with a Competitor. Awardee agrees to provide the Company with at least 10 days written notice prior to directly or indirectly accepting employment with, or serving as a consultant or advisor or in any other capacity to, a Competitor, and further agrees to inform any such new employer, before accepting employment, of the terms of this Paragraph 5 and Awardee’s continuing obligations contained herein. No provision of this Agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this Agreement, the provisions of this Agreement shall take precedence and such other inconsistent provisions shall be null and void. Awardee acknowledges and agrees that the provisions contained in this Agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Restricted Share Units, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Restricted Share Units and execution of this Agreement are voluntary actions on the part of Awardee and that the Company is unwilling to provide the Restricted Share Units to Awardee without including the restrictions and covenants of Awardee contained in this

Agreement. Further, the parties agree and acknowledge that the provisions contained in Paragraphs 4 and 5 are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made.

     6.  Payment . Subject to the provisions of Paragraphs 4 and 5 of this Agreement, and unless Awardee makes an effective election to defer receipt of the Shares represented by the Restricted Share Units, on the date of vesting of any Restricted Share Unit, Awardee shall be entitled to receive from the Company (without any payment on behalf of Awardee other than as described in Paragraph 11) the Shares represented by such Restricted Share Unit; provided, however, that, subject to the next sentence, in the event that such Restricted Share Units vest prior to the applicable Vesting Date as a result of the death of Awardee or as a result of a Change of Control, Awardee shall be entitled to receive the corresponding Shares from the Company on the date of such vesting. Notwithstanding the proviso of the preceding sentence, if Restricted Share Units vest as a result of the occurrence of a Change of Control under circumstances where such occurrence would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Code Section 409A applies to such distribution, such proviso shall not apply and Awardee shall be entitled to receive the corresponding Shares from the Company on the date that would have applied absent such proviso. Elections to defer receipt of the Shares beyond the date of settlement provided herein may be permitted in the discretion of the Administrator pursuant to procedures established by the Administrator in compliance with the requirements of Section 409A of the Code.

     7.  Dividend Equivalents . Awardee shall not receive cash dividends on the Restricted Share Units but instead shall, with respect to each Restricted Share Unit, receive a cash payment from the Company on each cash dividend payment date with respect to the Shares with a record date between the Grant Date and the settlement of such unit pursuant to Paragraph 6 hereof, such cash payment to be in an amount equal to the dividend that would have been paid on the Common Share represented by such unit. Cash payments on each cash dividend payment date with respect to the Shares with a record date prior to a Vesting Date shall be accrued until the Vesting Date and paid thereon (subject to the same vesting requirements as the underlying Restricted Share Units award).

     8.  Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Restricted Share Units, Awardee hereby agrees to hold, until the first anniversary of the applicable Vesting Date (or, if earlier, the date of Awardee’s Termination of Employment), the Shares issued pursuant to settlement of such units (less any portion thereof withheld in order to satisfy all applicable federal, state, local or foreign income, employment or other tax).

     9.  Right of Set-Off . By accepting these Restricted Share Units, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this Agreement.

     10.  No Shareholder Rights . Awardee shall have no rights of a shareholder with respect to the Restricted Share Units, including, without limitation, Awardee shall not have the right to vote the Shares represented by the Restricted Share Units.

     11.  Withholding Tax .

     (a) Generally . Awardee is liable and responsible for all taxes owed in connection with the Restricted Share Units (including taxes owed with respect to the cash payments described in Paragraph 7

hereof), regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Restricted Share Units. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the grant or vesting of the Restricted Share Units or the subsequent sale of Shares issuable pursuant to the Restricted Share Units. The Company does not commit and is under no obligation to structure the Restricted Share Units to reduce or eliminate Awardee’s tax liability.

     (b)  Payment of Withholding Taxes . Prior to any event in connection with the Restricted Share Units (e.g., vesting or settlement) that the Company determines may result in any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”), Awardee is required to arrange for the satisfaction of the minimum amount of such Tax Withholding Obligation in a manner acceptable to the Company. Unless Awardee elects to satisfy the Tax Withholding Obligation by an alternative means that is then permitted by the Company, Awardee’s acceptance of this Agreement constitutes Awardee’s instruction and authorization to the Company to withhold on Awardee’s behalf the number of Shares from those Shares issuable to Awardee at the time when the Restricted Share Units become vested and payable as the Company determines to be sufficient to satisfy the Tax Withholding Obligation. In the case of any amounts withheld for taxes pursuant to this provision in the form of Shares, the amount withheld shall not exceed the minimum required by applicable law and regulations. The Company shall have the right to deduct from all cash payments paid pursuant to Paragraph 7 hereof the amount of any taxes which the Company is required to withhold with respect to such payments.

     12.  Beneficiary Designation . Awardee may designate a beneficiary to receive any Shares to which Awardee is entitled with respect to the Restricted Share Units which vest as a result of Awardee’s death. Notwithstanding the foregoing, if Awardee engages in Triggering Conduct or Competitor Triggering Conduct as herein defined, the Restricted Share Units subject to such beneficiary designation shall be subject to the Special Forfeiture/Repayment Rules and the Company’s Right of Set-Off or other right of recovery set forth in this Agreement, and all rights of the beneficiary shall be subordinated to the rights of the Company pursuant to such provisions of this Agreement. Awardee acknowledges that the Company may exercise all rights under this Agreement and the Plan against Awardee and Awardee’s estate, heirs, lineal descendants and personal representatives and shall not be limited to exercising its rights against Awardee’s beneficiary.

     13. Governing Law/Venue . This Agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superceded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a substantial relationship to the parties and/or this Agreement and that the Restricted Share Units and benefits granted herein would not be granted without the governance of this Agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this Agreement shall be brought in state or federal courts located in Franklin County, Ohio, and the parties executing this Agreement hereby consent to the personal jurisdiction of such courts. Awardee acknowledges that the covenants contained in Paragraphs 4 and 5 of this Agreement are reasonable in nature, are fundamental for the protection of the Company’s legitimate business and proprietary interests, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law. In the event of any violation or attempted violations of the restrictions and covenants of Awardee contained in this Agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any

requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to institute legal proceedings under this Agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings. Any provision of this Agreement which is determined by a court of competent jurisdiction to be invalid or unenforceable should be construed or limited in a manner that is valid and enforceable and that comes closest to the business objectives intended by such provision, without invalidating or rendering unenforceable the remaining provisions of this Agreement.

     14.  Action by the Administrator . The parties agree that the interpretation of this Agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this Agreement and with regard to any and all matters set forth in this Agreement. The Administrator may delegate its functions under this Agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “Designee”). In fulfilling its responsibilities hereunder, the Administrator or its Designee may rely upon documents, written statements of the parties or such other material as the Administrator or its Designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its Designee and that any decision of the Administrator or its Designee relating to this Agreement, including, without limitation, whether particular conduct constitutes Triggering Conduct or Competitor Triggering Conduct, shall be final and binding unless such decision is arbitrary and capricious.

     15.  Prompt Acceptance of Agreement . The Restricted Share Unit grant evidenced by this Agreement shall, at the discretion of the Administrator, be forfeited if this Agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this Agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

     16.  Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Restricted Share Unit grant under and participation in the Plan or future Restricted Share Units that may be granted under the Plan by electronic means or to request Awardee’s consent to participate in the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of restricted share unit grants and the execution of restricted share unit agreements through electronic signature.

     17.  Notices . All notices, requests, consents and other communications required or provided under this Agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this Agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

Awardee hereby: (a) acknowledges that he or she has received a copy of the Plan, a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders, and a copy of the Plan Description dated [date of Plan Description] pertaining to the Plan; (b) accepts this Agreement and the Restricted Share Units granted to him or her under this Agreement subject to all provisions of the Plan and this Agreement, including the provisions in the agreement regarding “Triggering Conduct/Competitor Triggering Conduct” and “Special Forfeiture/ Repayment Rules” set forth in paragraphs 4 and 5 above; (c) represents that he or she understands that the acceptance of this Agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he or she manually signed the Agreement; (d) represents and warrants to the Company that he or she is purchasing the Restricted Share Units for his or her own account, for investment, and not with a view to or any present intention of selling or distributing the Restricted Share Units either now or at any specific or determinable future time or period or upon the occurrence or nonoccurrence of any predetermined or reasonably foreseeable event; and (e) agrees that no transfer of the Shares delivered in respect of the Restricted Share Units shall be made unless the Shares have been duly registered under all applicable Federal and state securities laws pursuant to a then-effective registration which contemplates the proposed transfer or unless the Company has received a written opinion of, or satisfactory to, its legal counsel that the proposed transfer is exempt from such registration.

		[
		Awardee’s Signature
		Awardee’s Social Security Number
		Date]

Exhibit 10.05

CARDINAL HEALTH, INC.
NONQUALIFIED STOCK OPTION AGREEMENT

     On [date of grant] (the “Grant Date”), Cardinal Health, Inc., an Ohio corporation (the “Company”), has awarded to [employee name] (“Awardee”), an option (the “Option”) to purchase [# of shares] common shares, without par value, of the Company (the “Shares”) for a price of [$X.XX] per share. The Option has been granted under the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and will include and be subject to all provisions of the Plan, which are incorporated herein by reference, and will be subject to the provisions of this agreement. Capitalized terms used in this agreement which are not specifically defined will have the meanings ascribed to such terms in the Plan. This Option shall vest and become exercisable [CLIFF ALTERNATIVE: on [vesting date]] [INSTALLMENT ALTERNATIVE: in accordance with the following schedule: [vesting schedule], subject [INSTALLMENT ALTERNATIVE: in each case] to the provisions of this agreement, including those relating to the Awardee’s continued employment with the Company and its Affiliates. Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Option shall vest in full. This Option shall expire on [date of expiration] (the “Grant Expiration Date”).

1. Method of Exercise and Payment of Price .

(a) Method of Exercise . At any time when all or a portion of the Option is exercisable under the Plan and this agreement, some or all of the exercisable portion of the Option may be exercised from time to time by written notice to the Company, or such other method of exercise as may be specified by the Company, including without limitation, exercise by electronic means on the web site of the Company’s third-party equity plan administrator, which will:

     (i) state the number of Shares with respect to which the Option is being exercised; and

     (ii) if the Option is being exercised by anyone other than Awardee, if not already provided, be accompanied by proof satisfactory to counsel for the Company of the right of such person or persons to exercise the Option under the Plan and all applicable laws and regulations.

(b) Payment of Price . The full exercise price for the portion of the Option being exercised shall be paid to the Company as provided below:

     (i) in cash;

     (ii) by check or wire transfer (denominated in U.S. Dollars);

     (iii) subject to any conditions or limitations established by the Administrator, other Shares which (A) in the case of Shares acquired from the Company (whether upon the exercise of an Option or otherwise), have been owned by the Participant for more than six months on the date of surrender (unless this condition is waived by the Administrator), and (B) have a Fair Market Value on the date of surrender equal to or greater than the aggregate exercise price of the Shares as to which said Option shall be exercised (it being agreed that the excess of the Fair Market Value over the aggregate exercise price shall be refunded to the Awardee in cash);

     (iv) consideration received by the Company under a broker-assisted sale and remittance program acceptable to the Administrator; or

     (v) any combination of the foregoing methods of payment.

2. Transferability . The Option shall be transferable (I) at Awardee’s death, by Awardee by will or pursuant to the laws of descent and distribution, and (II) by Awardee during Awardee’s lifetime, without payment of consideration, to (a) the spouse, former spouse, parents, stepparents, grandparents, parents-in-law, siblings, siblings-in-law, children, stepchildren, children-in-law, grandchildren, nieces or nephews of Awardee, or any other persons sharing Awardee’s household (other than tenants or employees) (collectively, “Family Members”), (b) a trust or trusts for the primary benefit of Awardee or such Family Members, (c) a foundation in which Awardee or such Family Members control the management of assets, or (d) a partnership in which Awardee or such Family Members are the majority or controlling partners; provided, however, that subsequent transfers of the transferred Option shall be prohibited, except (X) if the transferee is an individual, at the transferee’s death by the transferee by will or pursuant to the laws of descent and distribution, and (Y) without payment of consideration to the individuals or entities listed in subparagraphs II(a), (b) or (c), above, with respect to the original Awardee. The Administrator may, in its discretion, permit transfers to other persons and entities as permitted by the Plan. Neither a transfer under a domestic relations order in settlement of marital property rights nor a transfer to an entity in which more than 50% of the voting interests are owned by Awardee or Family Members in exchange for an interest in that entity shall be considered to be a transfer for consideration. Within 10 days of any transfer, Awardee shall notify the Compensation and Benefits department of the Company in writing of the transfer. Following transfer, the Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer and, except as otherwise provided in the Plan or this agreement, references to the original Awardee shall be deemed to refer to the transferee. The events of Termination of Employment of Awardee provided in paragraph 3 hereof shall continue to be applied with respect to the original Awardee, following which the Option shall be exercisable by the transferee only to the extent, and for the periods, specified in paragraph 3. The Company shall have no obligation to notify any transferee of Awardee’s Termination of Employment with the Company for any reason. The conduct prohibited of Awardee in paragraphs 5 through 7 and, if applicable, paragraph 11 of this agreement shall continue to be prohibited of Awardee following transfer to the same extent as immediately prior to transfer and the Option (or its economic value, as applicable) shall be subject to forfeiture by the transferee and recoupment from Awardee to the same extent as would have been the case of Awardee had the Option not been transferred. Awardee shall remain subject to the recoupment provisions of paragraph 13 of this agreement and tax withholding provisions of Section 29 of the Plan following transfer of the Option.

3. Termination of Employment .

(a) Termination of Employment by Reason of Death . If a Termination of Employment occurs by reason of death prior to the vesting in full of the Option, then any unvested portion of the Option shall vest upon and become exercisable in full from and after such death. The Option may thereafter be exercised by any transferee of Awardee, if applicable, or by the legal representative of the estate or by the legatee of Awardee under the will of Awardee for a period of one year from the date of death or until the Grant Expiration Date, whichever period is shorter.

(b) Termination of Employment by Reason of Retirement or Disability . If a Termination of Employment occurs by reason of Retirement or Disability prior to the vesting in full of the Option, then any unexercised portion of the Option which has not vested on such date of Termination of Employment will automatically be forfeited. The Option, to the extent vested, may be exercised by Awardee (or any transferee, if applicable) until the earlier of the fifth anniversary of the date of such Retirement or Disability or the Grant Expiration Date, provided that if Awardee has at least 15 years of service with the Company and its Affiliates (collectively, the “Cardinal Group”) at the time of Retirement, the Option, to the extent vested, may be exercised by Awardee (or any transferee, if applicable) until the Grant Expiration Date. Notwithstanding the foregoing, if Awardee dies after Retirement or Disability, but before the expiration of the exercise period provided for by the preceding sentence, the Option, to the extent vested, may be exercised by any transferee of the Option, if applicable, or by the legal representative of the estate or by the legatee of Awardee under the will of Awardee from and after such death only until the earlier of (x) the first anniversary of the date of death or (y) the date upon which such exercise period would have otherwise expired.

(c) Other Termination of Employment . If a Termination of Employment occurs by any reason other than death, Retirement or Disability, any unexercised portion of the Option which has not vested on such date of Termination of Employment will automatically be forfeited. Subject to Section 16(b)(ii) of the Plan, Awardee (or any transferee, if applicable) will have 90 days from the date of Termination of Employment or until the Grant Expiration Date, whichever period is shorter, to exercise any portion of the Option that is vested and exercisable on the date of Termination of Employment; provided, however, that if the Termination of Employment was a Termination for Cause, as determined by the Administrator, the Option may be immediately canceled by the Administrator (whether then held by Awardee or any transferee).

4. Restrictions on Exercise . The Option is subject to all restrictions in this agreement and/or in the Plan. As a condition of any exercise of the Option, the Company may require Awardee or his or her transferee or successor to make any representation and warranty to comply with any applicable law or regulation or to confirm any factual matters (including Awardee’s compliance with the terms of paragraphs 5 through 7 and, if applicable, paragraph 11 of this agreement or any employment or severance agreement between the Cardinal Group and Awardee) reasonably requested by the Company.

5. Agreement Not to Disclose or Use Confidential Information, Trade Secrets or Other Business Sensitive Information . The parties acknowledge and agree that the Cardinal Group is the sole and exclusive owner of Confidential Information, Trade Secrets or Other Business Sensitive Information and that the Cardinal Group has legitimate business interests in protecting such information. The parties further acknowledge and agree that the Cardinal Group has invested, and continues to invest, considerable amounts of time and money in obtaining, developing and preserving the confidentiality of such information. Further, the parties agree that, because of the trust and fiduciary relationship arising between Awardee and the Cardinal Group, Awardee owes the Cardinal Group a fiduciary duty to preserve and protect such information from any and all unauthorized disclosure and use. Accordingly, Awardee shall not, either directly or indirectly, disclose such information to any third party whatsoever and shall not use such information in any manner, except as authorized in the reasonable performance of Awardee’s duties while employed by the Cardinal Group. “Confidential Information, Trade Secrets or Other Business Sensitive Information” shall include any such information as defined by applicable law and any information about the business of the Cardinal Group and its customers that is not generally known to, or readily ascertainable by, the public, including, but

not limited to, financial information and models, customer lists, business plans or strategies, marketing and sales plans or strategies, the identity, compensation and qualifications of employees of the Cardinal Group, sources of supply, pricing policies, operational methods, product specification or technical processes, new product information, formulation techniques, customer contacts, profit or cost information, research and development information or other information that the Cardinal Group has developed or compiled.

6. Delivery of Company Property . Awardee recognizes and agrees that all documents, magnetic media, computer disks, desktop and laptop computers and other tangible items that were provided by the Cardinal Group and/or that contain Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above are the sole and exclusive property of the Cardinal Group. Upon request by the Cardinal Group, Awardee shall promptly and immediately return to the Cardinal Group all such documents, media, disks, desktop and laptop computers and other tangible items. Upon the Termination of Employment with the Cardinal Group, Awardee shall promptly and immediately return to the Cardinal Group any and all such documents, media, disks, desktop and laptop computers or other tangible items, without request by the Cardinal Group. Awardee shall not take any such information or make/retain copies of such information for any purpose whatsoever except as is necessary for the reasonable performance of Awardee’s duties while employed by the Cardinal Group.

7. Other Covenants . Except as modified by paragraph 11 below, Awardee hereby covenants and agrees that, in consideration of the grant hereunder, Awardee shall not, either directly or indirectly, on Awardee’s own behalf or on any other’s behalf, engage in or assist others in any of the following activities:

(a) Awardee shall not engage in any action or conduct that is a violation of the policies of the Cardinal Group, including conduct that would constitute a breach of any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies executed by Awardee;

(b) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not, either directly or indirectly, employ, contact concerning employment, or participate in any manner in the recruitment for employment of (whether as an employee, officer, director, agent, consultant or independent contractor), any person who was or is an employee, representative, officer or director of the Cardinal Group at any time within the 12 months prior to the Termination of Employment with the Cardinal Group;

(c) Awardee shall not at any time during employment with the Cardinal Group nor at any time thereafter disparage the Cardinal Group or any of its employees, officers, representatives, services or products;

(d) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not engage in any action or conduct that either does or could reasonably be expected to undermine, diminish or otherwise damage the relationship between the Cardinal Group and any of its customers, potential customers, vendors or suppliers that were known to Awardee in the performance of Awardee’s job duties while employed with the Cardinal Group;

(e) During Awardee’s employment with the Cardinal Group and for 12 months following the

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Termination of Employment for any reason, Awardee shall not solicit or accept business of the same type as that in which Awardee was employed by the Cardinal Group from any customer, potential customer, vendor or supplier of the Cardinal Group that was known to Awardee in the performance of Awardee’s job duties while employed with the Cardinal Group, nor shall Awardee during such time period solicit or accept such business within any geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility;

(f) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not accept employment with or serve as a consultant or advisor or in any other capacity to an entity that is in competition with the business conducted by any member of the Cardinal Group within a geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility; and

(g) Awardee shall not breach or violate any provision of any employment or severance agreement that Awardee has with any member of the Cardinal Group.

8. Inevitable Disclosure . The parties specifically acknowledge and agree that the provisions of this agreement are reasonable in light of the fact that, in the event that Awardee would become employed or otherwise associated with a competitor of the Cardinal Group, it would be inevitable that Awardee would disclose Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above to such competitor. The parties acknowledge and agree that Awardee has been introduced by the Cardinal Group to such Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above and that such information would aid the competitor and that the threat of such inevitable disclosure is so great that, for purposes of this agreement, it must be assumed that such disclosure would occur.

9. Covenants Are Independent Elements . The parties acknowledge that the obligations and covenants set forth in paragraphs 5 through 8 above and, if applicable, paragraph 11 below are essential independent elements of this Option grant and that, but for Awardee agreeing to comply with them, the Cardinal Group would not have granted such Option to Awardee. The parties agree and acknowledge that the provisions contained in paragraphs 5 through 8 above and, if applicable, paragraph 11 below are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made with regard to such paragraphs. The existence of any claim by Awardee against the Cardinal Group, whether based on this agreement or otherwise, shall not operate as a defense to the enforcement of the covenants contained in paragraphs 5 through 8 above and, if applicable, paragraph 11 below. The covenants contained in paragraphs 5 through 8 above and, if applicable, paragraph 11 below will remain in full force and effect whether Awardee is terminated by the Cardinal Group or voluntarily resigns.

10. Assignment of Covenants . The rights of the Cardinal Group under this agreement shall inure to the benefit of, and be binding upon, its successors and assigns. Any successor or assign of the Cardinal Group is authorized to enforce the covenants contained in this agreement. Any successor or assign of the Cardinal Group is authorized by the parties to enforce the covenants contained herein as if the name of such successor or assign shall replace the Cardinal Group throughout this agreement and any consent and/or notice, written or otherwise, is hereby waived and deemed unnecessary by Awardee.

11. California Specific Modifications . This paragraph 11 shall supercede and modify certain of the covenants, obligations and restrictions of Awardee set forth in paragraphs 7 and 8 above in

5

the event that, and only during such time that, Awardee’s principal employment with the Cardinal Group is in the State of California. In the event that any of the provisions contained in subparagraphs 7(d) through (f) and paragraph 8 above are inconsistent with the provisions of this paragraph 11 with regard to the State of California, then the provisions contained in subparagraphs 7(d) through (f) and paragraph 8 shall not apply and the following provisions shall apply instead:

(a) Within the geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility, Awardee shall not, during Awardee’s employment with the Cardinal Group and for 12 months following Termination of Employment for any reason, solicit or actually transact business with any existing customer of the Cardinal Group of which Awardee’s knowledge of the existence of that customer or of that customer’s purchasing habits, product preferences or commercial practices exists because of Awardee’s receipt of Confidential Information, Trade Secrets or Other Business Sensitive Information from the Cardinal Group; and

(b) Regardless of geographic area, Awardee shall not, during the period of Awardee’s employment with the Cardinal Group and for 12 months following Termination of Employment for any reason, solicit business from any customers of the same type as the business of the Cardinal Group at the time of the Termination of Employment with the Cardinal Group whose identities are not already within the public domain if Awardee directly serviced such customers, was assigned to such customers, was responsible for such customers or otherwise had personal contact with such customers during the 12-month period immediately preceding expiration of Awardee’s employment with the Cardinal Group.

In the event that Awardee is reassigned to any other state within the United States of America other than the State of California or to any other country, then all of the provisions of paragraphs 7 and 8 above shall apply in full force and effect and the provisions of this paragraph 11 shall not apply.

12. Reasonableness of Restrictions Contained in Agreement . Awardee acknowledges that the covenants contained in this agreement are reasonable in nature, are fundamental for the protection of the legitimate business and proprietary interests of the Cardinal Group, are necessary to protect the goodwill between the Cardinal Group and its customers, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law.

13. Special Forfeiture/Repayment Rules . If Awardee engages in conduct that is in violation of the covenants and restrictions contained in this agreement, then Awardee shall be subject to the following special forfeiture/repayment rules in addition to any other remedy that the Cardinal Group may have:

(a) the Option (or any part thereof that has not been exercised) shall immediately and automatically terminate, be forfeited, and shall cease to be exercisable at any time; and

(b) Awardee shall, within 30 days following written notice from the Company, pay the Company an amount equal to the gross option gain realized or obtained by Awardee or any transferee resulting from the exercise of such Option, measured at the date of exercise (i.e., the

6

difference between the market value of the Shares underlying the Option on the exercise date and the exercise price paid for such Shares underlying the Option), with respect to any portion of the Option that has already been exercised at any time within three years prior to the conduct by Awardee that is in violation of the covenants and restrictions of this agreement (the “Look-Back Period”), less $1.00.

Awardee may be released from Awardee’s obligations under this paragraph 13 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Awardee agrees to provide the Company with at least 10 days’ written notice prior to directly or indirectly accepting employment with or serving as a consultant or advisor or in any other capacity to a competitor and further agrees to inform any such new employer, before accepting employment, of the terms of this agreement and Awardee’s continuing obligations contained herein. No provisions of this agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this agreement, the provisions of this agreement shall take precedence and such other inconsistent provisions shall be null and void. Awardee acknowledges and agrees that the restrictions and covenants of Awardee contained in this agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Option, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Option and execution of this agreement are voluntary actions on the part of Awardee and that the Company is unwilling to provide the Option to Awardee without including the restrictions and covenants of Awardee contained in this agreement. Further, the parties agree and acknowledge that the provisions contained in paragraph 7 and, if applicable, paragraph 11 above are ancillary to or part of an otherwise enforceable agreement at the time the agreement is made.

14. Right of Set-Off . By accepting this Option, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this agreement.

15. Withholding Tax .

(a) Generally . Awardee is liable and responsible for all taxes owed in connection with the exercise of the Option, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Option. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the exercise of the Option. The Company does not commit and is under no obligation to structure the Option or the exercise of the Option to reduce or eliminate Awardee’s tax liability.

(b) Payment of Withholding Taxes . Concurrently with the payment of the exercise price pursuant to paragraph 1 hereof, Awardee is required to arrange for the satisfaction of the

7

minimum amount of any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”) in a manner acceptable to the Company. Any manner provided for in subparagraph 1(b) hereof shall be deemed an acceptable manner to satisfy the Tax Withholding Obligation unless otherwise determined by the Company.

16. Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Option, Awardee hereby agrees to hold his or her After-Tax Net Profit in Shares until the first anniversary of the exercise of all or a portion of the Option (or, if earlier, the date of Awardee’s Termination of Employment). “After-Tax Net Profit” means the total dollar value of the Shares that Awardee elects to exercise under this Option at the time of exercise, minus the total of (i) the exercise price to purchase these Shares, and (ii) the amount of all applicable federal, state, local or foreign income, employment or other tax and other similar fees that are withheld in connection with the exercise.

17. Governing Law/Venue . This agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superceded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a substantial relationship to the parties and/or this agreement and that the Option and benefits granted herein would not be granted without the governance of this agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this agreement shall be brought in state or federal courts located in Franklin County, Ohio and the parties executing this agreement hereby consent to the personal jurisdiction of such courts. In the event of any violation or attempted violations of the restrictions and covenants of Awardee contained in this agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to institute legal proceedings under this agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings.

18. Severability . It is the desire and intent of the parties that the provisions of this agreement shall be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision or portion of this agreement shall be determined by a court of competent jurisdiction to be invalid or unenforceable as written, it is the intent and desire of the parties that the court shall modify the language of such provision or portion of this agreement to the extent necessary to make it valid and enforceable. If no such modification by the court is possible, this agreement shall be deemed amended to delete therefrom only the provision or portion thus determined to be invalid or unenforceable. Such modification or deletion is to apply only with respect to the operation of such provision in the particular jurisdiction in which such court determination is made.

19. Action by the Administrator . The parties agree that the interpretation of this agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this agreement and with regard to any and all matters set forth in this agreement. The Administrator

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may delegate its functions under this agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “designee”). In fulfilling its responsibilities hereunder, the Administrator or its designee may rely upon documents, written statements of the parties, or such other material as the Administrator or its designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its designee and that any decision of the Administrator or its designee relating to this agreement, including, without limitation, whether particular conduct constitutes a violation of the covenants, obligations and restrictions of Awardee set forth in paragraphs 5 through 7 and, if applicable, paragraph 11 above, shall be final and binding unless such decision is arbitrary and capricious.

20. Prompt Acceptance of Agreement . The Option grant evidenced by this agreement shall, at the discretion of the Administrator, be forfeited be forfeited if this agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

21. Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Option grant under and participation in the Plan or future options that may be granted under the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of option grants and the execution of option agreements through electronic signature.

22. Notices . All notices, requests, consents and other communications required or provided under this agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

Awardee hereby: (a) acknowledges receiving a copy of the Plan, which has either been previously delivered or is provided with this agreement, and represents that he or she is familiar with and understands all provisions of the Plan and this agreement; (b) voluntarily and knowingly accepts this agreement and the Option granted to him or her under this agreement subject to all provisions of the Plan and this agreement, including the obligations and covenants set forth in paragraphs 5 through 8 above and, if applicable, paragraph 11 above; and (c) represents that he or she understands that the acceptance of this agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he or she manually signed the agreement. Awardee further acknowledges receiving a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders and a copy of the Plan Description dated [date of Plan Description] pertaining to the Plan.

		[
		Awardee’s Signature
		Awardee’s Social Security Number
		Date]

Exhibit 10.06

CARDINAL HEALTH, INC.
RESTRICTED SHARE UNITS AGREEMENT

     On [grant date] (the “Grant Date”), Cardinal Health, Inc, an Ohio corporation (the “Company”), has awarded to [employee name] (“Awardee”) [# of shares] Restricted Share Units (the “Restricted Share Units” or “Award”), representing an unfunded unsecured promise of the Company to deliver common shares, without par value, of the Company (the “Shares”) to Awardee as set forth herein. The Restricted Share Units have been granted pursuant to the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and shall be subject to all provisions of the Plan, which are incorporated herein by reference, and shall be subject to the provisions of this Restricted Share Units Agreement (this “Agreement”). Capitalized terms used in this Agreement which are not specifically defined shall have the meanings ascribed to such terms in the Plan.

     1.  Vesting . Subject to the provisions set forth elsewhere in this Agreement, the Restricted Share Units shall vest [CLIFF VESTING ALTERNATIVE: on [vesting date] (the “Vesting Date”)] [INSTALLMENT VESTING ALTERNATIVE: in accordance with the following schedule: [vesting schedule] (each such vesting date, the “Vesting Date” with respect to the Restricted Share Units scheduled to vest on such date)]. Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Restricted Share Units shall vest in full.

     2.  Transferability . The Restricted Share Units shall not be transferable.

     3.  Termination of Employment . Except as set forth below, if a Termination of Employment occurs prior to the vesting of a Restricted Share Unit, such Restricted Share Unit shall be forfeited by Awardee. If a Termination of Employment occurs prior to the vesting in full of the Restricted Share Units by reason of Awardee’s death, then any unvested Restricted Share Units shall vest in full and shall not be forfeited.

     4.  Agreement Not to Disclose or Use Confidential Information, Trade Secrets or Other Business Sensitive Information . The parties acknowledge and agree that the Company and its Affiliates (collectively, the “Cardinal Group”) is the sole and exclusive owner of Confidential Information, Trade Secrets or Other Business Sensitive Information (as hereinafter defined) and that the Cardinal Group has legitimate business interests in protecting such information. The parties further acknowledge and agree that the Cardinal Group has invested, and continues to invest, considerable amounts of time and money in obtaining, developing and preserving the confidentiality of such information. Further, the parties agree that, because of the trust and fiduciary relationship arising between Awardee and the Cardinal Group, Awardee owes the Cardinal Group a fiduciary duty to preserve and protect such information from any and all unauthorized disclosure and use. Accordingly, Awardee shall not, either directly or indirectly, disclose such information to any third party whatsoever and shall not use such information in any manner, except as authorized in the reasonable performance of Awardee’s duties while employed by the Cardinal Group. “Confidential Information, Trade Secrets or Other Business Sensitive Information” shall include any such information as defined by applicable law and any information about the business of the Cardinal Group and its customers that is not generally known to, or readily ascertainable by, the public, including, but not limited to, financial information and models, customer lists, business plans or strategies, marketing and sales plans or strategies, the identity, compensation and qualifications of employees of the Cardinal Group, sources of supply, pricing policies, operational methods, product specification or technical processes, new product information, formulation techniques, customer contacts, profit or cost information, research and development information or other information that the Cardinal Group has developed or compiled.

     5.  Delivery of Company Property . Awardee recognizes and agrees that all documents, magnetic media, computer disks, desktop and laptop computers and other tangible items that were provided by the Cardinal Group and/or that contain Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above are the sole and exclusive property of the Cardinal Group. Upon request by the Cardinal Group, Awardee shall promptly and immediately return to the Cardinal Group all such documents, media, disks, desktop and laptop computers and other tangible items. Upon the Termination of Employment with the Cardinal Group, Awardee shall promptly and immediately return to the Cardinal Group any and all such documents, media, disks, desktop and laptop computers or other tangible items, without request by the Cardinal Group. Awardee shall not take any such information or make/retain copies of such information for any purpose whatsoever except as is necessary for the reasonable performance of Awardee’s duties while employed by the Cardinal Group.

     6.  Other Covenants . Except as modified by Paragraph 10 below, Awardee hereby covenants and agrees that, in consideration of the grant hereunder, Awardee shall not, either directly or indirectly, on Awardee’s own behalf or on any other’s behalf, engage in or assist others in any of the following activities:

     (a) Awardee shall not engage in any action or conduct that is a violation of the policies of the Cardinal Group, including conduct that would constitute a breach of any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies executed by Awardee;

     (b) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not, either directly or indirectly, employ, contact concerning employment, or participate in any manner in the recruitment for employment of (whether as an employee, officer, director, agent, consultant or independent contractor), any person who was or is an employee, representative, officer or director of the Cardinal Group at any time within the 12 months prior to the Termination of Employment with the Cardinal Group;

     (c) Awardee shall not at any time during employment with the Cardinal Group nor at any time thereafter disparage the Cardinal Group or any of its employees, officers, representatives, services or products;

     (d) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not engage in any action or conduct that either does or could reasonably be expected to undermine, diminish or otherwise damage the relationship between the Cardinal Group and any of its customers, potential customers, vendors or suppliers that were known to Awardee in the performance of Awardee’s job duties while employed with the Cardinal Group;

     (e) During Awardee’s employment with the Cardinal Group and for 12 months following the Termination of Employment for any reason, Awardee shall not solicit or accept business of the same type as that in which Awardee was employed by the Cardinal Group from any customer, potential customer, vendor or supplier of the Cardinal Group that was known to Awardee in the performance of Awardee’s job duties while employed with the Cardinal Group, nor shall Awardee during such time period solicit or accept such business within any geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility;

     (f) During Awardee’s employment with the Cardinal Group and for 12 months

following the Termination of Employment for any reason, Awardee shall not accept employment with or serve as a consultant or advisor or in any other capacity to an entity that is in competition with the business conducted by any member of the Cardinal Group within a geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility; and

     (g) Awardee shall not breach or violate any provision of any employment or severance agreement that Awardee has with any member of the Cardinal Group.

     7.  Inevitable Disclosure . The parties specifically acknowledge and agree that the provisions of this Agreement are reasonable in light of the fact that, in the event that Awardee would become employed or otherwise associated with a competitor of the Cardinal Group, it would be inevitable that Awardee would disclose Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above to such competitor. The parties acknowledge and agree that Awardee has been introduced by the Cardinal Group to such Confidential Information, Trade Secrets or Other Business Sensitive Information as defined above and that such information would aid the competitor and that the threat of such inevitable disclosure is so great that, for purposes of this Agreement, it must be assumed that such disclosure would occur.

     8.  Covenants Are Independent Elements . The parties acknowledge that the obligations and covenants set forth in Paragraphs 4 through 7 above and, if applicable, Paragraph 10 below are essential independent elements of this Restricted Share grant and that, but for Awardee agreeing to comply with them, the Cardinal Group would not have granted such Restricted Share Units to Awardee. The parties agree and acknowledge that the provisions contained in Paragraphs 4 through 7 above and, if applicable, Paragraph 10 below are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made with regard to such paragraphs. The existence of any claim by Awardee against the Cardinal Group, whether based on this Agreement or otherwise, shall not operate as a defense to the enforcement of the covenants contained in Paragraphs 4 through 7 above and, if applicable, Paragraph 10 below. The covenants contained in Paragraphs 4 through 7 above and, if applicable, Paragraph 10 below will remain in full force and effect whether Awardee is terminated by the Cardinal Group or voluntarily resigns.

     9.  Assignment of Covenants . The rights of the Cardinal Group under this Agreement shall inure to the benefit of, and be binding upon, its successors and assigns. Any successor or assign of the Cardinal Group is authorized to enforce the covenants contained in this Agreement. Any successor or assign of the Cardinal Group is authorized by the parties to enforce the covenants contained herein as if the name of such successor or assign shall replace the Cardinal Group throughout this Agreement and any consent and/or notice, written or otherwise, is hereby waived and deemed unnecessary by Awardee.

     10.  California Specific Modifications . This paragraph shall supercede and modify certain of the covenants, obligations and restrictions of Awardee set forth in Paragraph 6 above in the event that, and only during such time that, Awardee’s principal employment with the Cardinal Group is in the State of California. In the event that any of the provisions contained in Subparagraphs 6(d) through (f) and Paragraph 7 above are inconsistent with the provisions of this Paragraph 10 with regard to the State of California, then the provisions contained in Subparagraphs 6(d) through (f) and Paragraph 7 shall not apply and the following provisions shall apply instead:

     (a) Within the geographic area in which Awardee was assigned or for which Awardee had any managerial responsibility, Awardee shall not, during Awardee’s employment with the Cardinal Group and for 12 months following Termination of Employment for any reason, solicit or actually transact business with any existing customer of the Cardinal Group of

which Awardee’s knowledge of the existence of that customer or of that customer’s purchasing habits, product preferences or commercial practices exists because of Awardee’s receipt of Confidential Information, Trade Secrets or Other Business Sensitive Information from the Cardinal Group; and

     (b) Regardless of geographic area, Awardee shall not, during the period of Awardee’s employment with the Cardinal Group and for 12 months following Termination of Employment for any reason, solicit business from any customers of the same type as the business of the Cardinal Group at the time of the Termination of Employment with the Cardinal Group whose identities are not already within the public domain if Awardee directly serviced such customers, was assigned to such customers, was responsible for such customers or otherwise had personal contact with such customers during the 12-month period immediately preceding expiration of Awardee’s employment with the Cardinal Group.

In the event that Awardee is reassigned to any other state within the United States of America other than the State of California or to any other country, then all of the provisions of Paragraphs 6 and 7 above shall apply in full force and effect and the provisions of this Paragraph 10 shall not apply.

     11.  Reasonableness of Restrictions Contained in Agreement . Awardee acknowledges that the covenants contained in this Agreement are reasonable in nature, are fundamental for the protection of the legitimate business and proprietary interests of the Cardinal Group, are necessary to protect the goodwill between the Cardinal Group and its customers, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law.

     12.  Special Forfeiture/Repayment Rules . If Awardee engages in conduct that is in violation of the covenants and restrictions contained in this Agreement, then Awardee shall be subject to the following special forfeiture/repayment rules in addition to any other remedy that the Cardinal Group may have:

     (a) any Restricted Share Units that have not yet vested or that vested within the Look-Back Period (as defined below) with respect to such conduct that is in violation of the covenants and restrictions contained in this Agreement and have not yet been settled by a payment pursuant to Paragraph 13 hereof shall immediately and automatically terminate, be forfeited, and cease to exist; and

     (b) Awardee shall, within 30 days following written notice from the Company, pay to the Company an amount equal to (x) the aggregate gross gain realized or obtained by Awardee resulting from the settlement of all Restricted Share Units pursuant to Paragraph 13 hereof (measured as of the settlement date (i.e., the market value of the Restricted Share Units on such settlement date)) that have already been settled and that had vested at any time within three years prior to the conduct by Awardee that is in violation of the covenants and restrictions contained in this Agreement (the “Look-Back Period”), minus (y) $1.00.

     Awardee may be released from Awardee’s obligations under this Paragraph 12 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Awardee agrees to provide the Company with at least 10 days written notice prior to directly or indirectly accepting employment with or serving as a consultant or advisor or in any other capacity to a competitor, and further agrees to inform any such new employer, before accepting employment, of the terms of this Agreement and Awardee’s continuing obligations

contained herein. No provision of this Agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this Agreement, the provisions of this Agreement shall take precedence and such other inconsistent provisions shall be null and void. Awardee acknowledges and agrees that the restrictions and covenants of Awardee contained in this Agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Restricted Share Units, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Restricted Share Units and execution of this Agreement are voluntary actions on the part of Awardee and that the Company is unwilling to provide the Restricted Share Units to Awardee without including the restrictions and covenants of Awardee contained in this Agreement. Further, the parties agree and acknowledge that the provisions contained in Paragraph 6 and, if applicable, Paragraph 10 are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made.

     13.  Payment . Subject to the provisions of Paragraphs 4 through 7 and, if applicable, Paragraph 10, and unless Awardee makes an effective election to defer receipt of the Shares represented by the Restricted Share Units, on the date of vesting of any Restricted Share Unit, Awardee shall be entitled to receive from the Company (without any payment on behalf of Awardee other than as described in Paragraph 18) the Shares represented by such Restricted Share Unit; provided, however, that, subject to the next sentence, in the event that such Restricted Share Units vest prior to the applicable Vesting Date as a result of the death of Awardee or as a result of a Change of Control, Awardee shall be entitled to receive the corresponding Shares from the Company on the date of such vesting. Notwithstanding the proviso of the preceding sentence, if Restricted Share Units vest as a result of the occurrence of a Change of Control under circumstances where such occurrence would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Code Section 409A applies to such distribution, such proviso shall not apply and Awardee shall be entitled to receive the corresponding Shares from the Company on the date that would have applied absent such proviso. Elections to defer receipt of the Shares beyond the date of settlement provided herein may be permitted in the discretion of the Administrator pursuant to procedures established by the Administrator in compliance with the requirements of Section 409A of the Code.

     14.  Dividend Equivalents . Awardee shall not receive cash dividends on the Restricted Share Units but instead shall, with respect to each Restricted Share Unit, receive a cash payment from the Company on each cash dividend payment date with respect to the Shares with a record date between the Grant Date and the settlement of such unit pursuant to Paragraph 13 hereof, such cash payment to be in an amount equal to the dividend that would have been paid on the Common Share represented by such unit. Cash payments on each cash dividend payment date with respect to the Shares with a record date prior to a Vesting Date shall be accrued until the Vesting Date and paid thereon (subject to the same vesting requirements as the underlying Restricted Share Units award).

     15.  Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Restricted Share Units, Awardee hereby agrees to hold, until the first anniversary of the applicable Vesting Date (or, if earlier, the date of Awardee’s Termination of Employment), the Shares issued pursuant to settlement of such units (less any portion thereof withheld in order to satisfy all applicable federal, state, local or foreign income, employment or other tax).

     16.  Right of Set-Off . By accepting these Restricted Share Units, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this Agreement.

     17.  No Shareholder Rights . Awardee shall have no rights of a shareholder with respect to the Restricted Share Units, including, without limitation, Awardee shall not have the right to vote the Shares represented by the Restricted Share Units.

     18.  Withholding Tax .

     (a)  Generally . Awardee is liable and responsible for all taxes owed in connection with the Restricted Share Units (including taxes owed with respect to the cash payments described in Paragraph 14 hereof), regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Restricted Share Units. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the grant or vesting of the Restricted Share Units or the subsequent sale of Shares issuable pursuant to the Restricted Share Units. The Company does not commit and is under no obligation to structure the Restricted Share Units to reduce or eliminate Awardee’s tax liability.

     (b)  Payment of Withholding Taxes . Prior to any event in connection with the Restricted Share Units (e.g., vesting or settlement) that the Company determines may result in any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”), Awardee is required to arrange for the satisfaction of the minimum amount of such Tax Withholding Obligation in a manner acceptable to the Company. Unless Awardee elects to satisfy the Tax Withholding Obligation by an alternative means that is then permitted by the Company, Awardee’s acceptance of this Agreement constitutes Awardee’s instruction and authorization to the Company to withhold on Awardee’s behalf the number of Shares from those Shares issuable to Awardee at the time when the Restricted Share Units become vested and payable as the Company determines to be sufficient to satisfy the Tax Withholding Obligation. In the case of any amounts withheld for taxes pursuant to this provision in the form of Shares, the amount withheld shall not exceed the minimum required by applicable law and regulations. The Company shall have the right to deduct from all cash payments paid pursuant to Paragraph 14 hereof the amount of any taxes which the Company is required to withhold with respect to such payments.

     19.  Beneficiary Designation . Awardee may designate a beneficiary to receive any Shares to which Awardee is entitled with respect to the Restricted Share Units which vest as a result of Awardee’s death. Notwithstanding the foregoing, if Awardee engages in conduct that is in violation of the covenants and restrictions contained in this Agreement, the Restricted Share Units subject to such beneficiary designation shall be subject to the Special Forfeiture/Repayment Rules and the Company’s Right of Set-Off or other right of recovery set forth in this Agreement, and all rights of the beneficiary shall be subordinated to the rights of the Company pursuant to such provisions of this Agreement. Awardee acknowledges that the Company may exercise all rights under this Agreement and the Plan against Awardee and Awardee’s estate, heirs, lineal descendants and personal representatives and shall not be limited to exercising its rights against Awardee’s beneficiary.

     20.  Governing Law/Venue . This Agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superseded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a

substantial relationship to the parties and/or this Agreement and that the Restricted Share Units and benefits granted herein would not be granted without the governance of this Agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this Agreement shall be brought in state or federal courts located in Franklin County, Ohio, and the parties executing this Agreement hereby consent to the personal jurisdiction of such courts. In the event of any violation or attempted violations of the restrictions and covenants of Awardee contained in this Agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to institute legal proceedings under this Agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings.

     21.  Severability . It is the desire and intent of the parties that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision or portion of this Agreement shall be determined by a court of competent jurisdiction to be invalid or unenforceable as written, it is the intent and desire of the parties that the court shall modify the language of such provision or portion of this Agreement to the extent necessary to make it valid and enforceable. If no such modification by the court is possible, this Agreement shall be deemed amended to delete therefrom only the provision or portion thus determined to be invalid or unenforceable. Such modification or deletion is to apply only with respect to the operation of such provision in the particular jurisdiction in which such court determination is made.

     22.  Action by the Administrator . The parties agree that the interpretation of this Agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this Agreement and with regard to any and all matters set forth in this Agreement. The Administrator may delegate its functions under this Agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “Designee”). In fulfilling its responsibilities hereunder, the Administrator or its Designee may rely upon documents, written statements of the parties or such other material as the Administrator or its Designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its Designee and that any decision of the Administrator or its Designee relating to this Agreement, including, without limitation, whether particular conduct constitutes a violation of the covenants, obligations and restrictions of Awardee set forth in Paragraphs 4 through 6 and, if applicable, Paragraph 10 above, shall be final and binding unless such decision is arbitrary and capricious.

     23.  Prompt Acceptance of Agreement . The Restricted Share Unit grant evidenced by this Agreement shall, at the discretion of the Administrator, be forfeited if this Agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this Agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

     24.  Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Restricted Share Unit grant under and participation in the Plan or future Restricted Share Units that may be granted under the Plan by electronic means or to request Awardee’s consent to participate in the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-

line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of restricted share unit grants and the execution of restricted share unit agreements through electronic signature.

     25.  Notices . All notices, requests, consents and other communications required or provided under this Agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this Agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

     Awardee hereby: (a) acknowledges that he or she has received a copy of the Plan, a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders, and a copy of the Plan Description dated [date of Plan Description] pertaining to the Plan; (b) accepts this Agreement and the Restricted Share Units granted to him or her under this Agreement subject to all provisions of the Plan and this Agreement, including the obligations and covenants set forth in paragraphs 4 through 7 above and, if applicable, paragraph 10 above; (c) represents that he or she understands that the acceptance of this Agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he or she manually signed the Agreement; (d) represents and warrants to the Company that he or she is purchasing the Restricted Share Units for his or her own account, for investment, and not with a view to or any present intention of selling or distributing the Restricted Share Units either now or at any specific or determinable future time or period or upon the occurrence or nonoccurrence of any predetermined or reasonably foreseeable event; and (e) agrees that no transfer of the Shares delivered in respect of the Restricted Share Units shall be made unless the Shares have been duly registered under all applicable Federal and state securities laws pursuant to a then-effective registration which contemplates the proposed transfer or unless the Company has received a written opinion of, or satisfactory to, its legal counsel that the proposed transfer is exempt from such registration.

		[
		Awardee’s Signature
		Awardee’s Social Security Number
		Date]

Exhibit 10.07

CARDINAL HEALTH, INC.
NONQUALIFIED STOCK OPTION AGREEMENT

     On [date of grant] (the “Grant Date”), Cardinal Health, Inc., an Ohio corporation (the “Company”), has awarded to Robert D. Walter (“Awardee”), an option (the “Option”) to purchase [# of shares] common shares, without par value, of the Company (the “Shares”) for a price of [$X.XX] per share. The Option has been granted under the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and will include and be subject to all provisions of the Plan, which are incorporated herein by reference, and will be subject to the provisions of this agreement. Capitalized terms used in this agreement which are not specifically defined will have the meanings ascribed to such terms in the Plan. This Option shall vest and become exercisable in accordance with the following schedule: four equal installments on each of the first four anniversaries of the Grant Date (each, the “Vesting Date” with respect to the portion of the Option scheduled to vest on such date), subject in each case to the provisions of this agreement, including those relating to the Awardee’s continued employment with the Company and its Affiliates (collectively, the “Cardinal Group”). Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Option shall vest in full. This Option shall expire on [date of expiration] (the “Grant Expiration Date”).

1.

Method of Exercise and Payment of Price .

(a) Method of Exercise . At any time when all or a portion of the Option is exercisable under the Plan and this agreement, some or all of the exercisable portion of the Option may be exercised from time to time by written notice to the Company, or such other method of exercise as may be specified by the Company, including without limitation, exercise by electronic means on the web site of the Company’s third-party equity plan administrator, which will:

     (i) state the number of Shares with respect to which the Option is being exercised; and

     (ii) if the Option is being exercised by anyone other than Awardee, if not already provided, be accompanied by proof satisfactory to counsel for the Company of the right of such person or persons to exercise the Option under the Plan and all applicable laws and regulations.

(b) Payment of Price . The full exercise price for the portion of the Option being exercised shall be paid to the Company as provided below:

     (i) in cash;

     (ii) by check or wire transfer (denominated in U.S. Dollars);

     (iii) subject to any conditions or limitations established by the Administrator, other Shares which (A) in the case of Shares acquired from the Company (whether upon the exercise of an Option or otherwise), have been owned by the Participant for more than six months on the date of surrender (unless this condition is waived by the Administrator), and (B) have a Fair Market Value on the date of surrender equal to or greater than the aggregate exercise price of the Shares as to which said Option shall be exercised (it being agreed that the excess of the Fair

Market Value over the aggregate exercise price shall be refunded to the Awardee in cash);

     (iv) consideration received by the Company under a broker-assisted sale and remittance program acceptable to the Administrator; or

     (v) any combination of the foregoing methods of payment.

2. Transferability . The Option shall be transferable (I) at Awardee’s death, by Awardee by will or pursuant to the laws of descent and distribution, and (II) by Awardee during Awardee’s lifetime, without payment of consideration, to (a) the spouse, former spouse, parents, stepparents, grandparents, parents-in-law, siblings, siblings-in-law, children, stepchildren, children-in-law, grandchildren, nieces or nephews of Awardee, or any other persons sharing Awardee’s household (other than tenants or employees) (collectively, “Family Members”), (b) a trust or trusts for the primary benefit of Awardee or such Family Members, (c) a foundation in which Awardee or such Family Members control the management of assets, or (d) a partnership in which Awardee or such Family Members are the majority or controlling partners; provided, however, that subsequent transfers of the transferred Option shall be prohibited, except (X) if the transferee is an individual, at the transferee’s death by the transferee by will or pursuant to the laws of descent and distribution, and (Y) without payment of consideration to the individuals or entities listed in subparagraphs II(a), (b) or (c), above, with respect to the original Awardee. The Administrator may, in its discretion, permit transfers to other persons and entities as permitted by the Plan. Neither a transfer under a domestic relations order in settlement of marital property rights nor a transfer to an entity in which more than 50% of the voting interests are owned by Awardee or Family Members in exchange for an interest in that entity shall be considered to be a transfer for consideration. Within 10 days of any transfer, Awardee shall notify the Compensation and Benefits department of the Company in writing of the transfer. Following transfer, the Option shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer and, except as otherwise provided in the Plan or this agreement, references to the original Awardee shall be deemed to refer to the transferee. The events of a Termination of Employment of Awardee provided in paragraph 3 hereof shall continue to be applied with respect to the original Awardee, following which the Option shall be exercisable by the transferee only to the extent, and for the periods, specified in paragraph 3. The Company shall have no obligation to notify any transferee of Awardee’s Termination of Employment with the Cardinal Group for any reason. The conduct prohibited of Awardee in paragraphs 5 and 6 hereof shall continue to be prohibited of Awardee following transfer to the same extent as immediately prior to transfer and the Option (or its economic value, as applicable) shall be subject to forfeiture by the transferee and recoupment from Awardee to the same extent as would have been the case of Awardee had the Option not been transferred. Awardee shall remain subject to the recoupment provisions of paragraphs 5 and 6 of this agreement and tax withholding provisions of Section 29 of the Plan following transfer of the Option.

3.

Termination of Employment .

(a) Termination of Employment by Reason of Death . If a Termination of Employment occurs by reason of death prior to the vesting in full of the Option, then any unvested portion of the Option shall vest upon and become exercisable in full from and after such death. The Option may thereafter be exercised by any transferee of Awardee, if applicable, or by the legal representative of the estate or by the legatee of Awardee under the will of Awardee until the Grant Expiration Date.

(b) Termination of Employment by Reason of Retirement or Disability . If a Termination of Employment occurs by reason of Retirement or Disability prior to the vesting in full of the Option, then any unexercised portion of the Option which has not vested on such date of Termination of Employment will, at the Company’s election, either vest immediately or continue to vest in accordance with the original vesting schedule, provided that, in the case of Retirement, Awardee complies with his obligation to perform consulting services as described in the Second Amended and Restated Employment Agreement, between the Company and Awardee, dated April 17, 2006, as subsequently amended (the “Employment Agreement”). The Option, to the extent vested, may be exercised by Awardee (or any transferee, if applicable) until the Grant Expiration Date. Notwithstanding the foregoing, if Awardee dies after Retirement or Disability, but before the expiration of the exercise period provided for by the preceding sentence, the provisions of paragraph 3(a) of this agreement shall apply.

(c) Other Termination of Employment . For the purposes of this paragraph 3, Termination of Employment shall mean the termination of both the Employment Period and the Consulting Period under the Employment Agreement, as such terms are defined in the Employment Agreement. Upon a Termination of Employment by the Company without Cause or by the Awardee with Good Reason, as such terms are defined in the Employment Agreement, any unexercised portion of the Option which has not vested on such date of Termination of Employment will become fully vested as of such date, and, in any event once vested, may be exercised by Awardee (or any transferee, if applicable) until the Grant Expiration Date. Notwithstanding the foregoing, if Awardee dies after such Termination of Employment, but before the expiration of the exercise period provided for by the preceding sentence, the provisions of paragraph 3(a) of this agreement shall apply. Upon a Termination of Employment for Cause or by the Awardee without Good Reason, as such terms are defined in the Employment Agreement, any portion of the Option which has not vested on such date will automatically be forfeited, and any portion of the Option which has vested on such date may be exercised by Awardee (or any transferee, if applicable) until the Grant Expiration Date.

4. Restrictions on Exercise . The Option is subject to all restrictions in this agreement and/or in the Plan. As a condition of any exercise of the Option, the Company may require Awardee or his or her transferee or successor to make any representation and warranty to comply with any applicable law or regulation or to confirm any factual matters (including Awardee’s compliance with the terms of paragraphs 5 and 6 of this agreement or any employment or severance agreement between the Cardinal Group and Awardee) reasonably requested by the Company.

5. Triggering Conduct/Competitor Triggering Conduct . As used in this agreement, “ Triggering Conduct ” shall mean engaging in any conduct described in Section 9(b), 9(c), 9(f) or 9(g) of the Employment Agreement. As used herein, “ Competitor Triggering Conduct ” shall mean engaging in any conduct described in Section 9(d) or 9(e) of the Employment Agreement.

6. Special Forfeiture/Repayment Rules . For so long as Awardee continues as an employee with the Cardinal Group and for two years following a Termination of Employment (without regard to the Consulting Period as defined in the Employment Agreement) regardless of the reason, Awardee agrees not to engage in Triggering Conduct. If Awardee engages in Triggering Conduct or in Competitor Triggering Conduct during the time period set forth in the preceding sentence, then, as to such portion of the Option that is unvested or that became vested within no more than two years prior to the date Awardee engages in Triggering Conduct or Competitor Triggering Conduct:

(a) the Option (or any part thereof that has not been exercised) shall immediately and automatically terminate, be forfeited, and shall cease to be exercisable at any time; and

(b) Awardee shall, within 30 days following written notice from the Company, pay the Company an amount equal to the gross option gain realized or obtained by Awardee or any transferee resulting from the exercise of such Option, measured at the date of exercise (i.e., the difference between the market value of the Shares underlying the Option on the exercise date and the exercise price paid for such Shares underlying the Option), with respect to any portion of the Option that has already been exercised at any time within two years prior to the Triggering Conduct (the “Look-Back Period”), less $1.00. If Awardee engages only in Competitor Triggering Conduct, then the Look-Back Period shall be shortened to exclude any period more than one year prior to Awardee’s Termination of Employment, but including any period between the time of Termination of Employment and engagement in Competitor Triggering Conduct. Awardee may be released from Awardee’s obligations under this paragraph 6 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Nothing in this paragraph 6 constitutes a so-called “noncompete” covenant. This paragraph 6 does, however, prohibit certain conduct while Awardee is associated with the Cardinal Group and thereafter and does provide for the forfeiture or repayment of the benefits granted by this agreement under certain circumstances, including, but not limited to, Awardee’s acceptance of employment with a Competitor. Awardee agrees to provide the Company with at least 10 days written notice prior to directly or indirectly accepting employment with or serving as a consultant or advisor or in any other capacity to a Competitor, and further agrees to inform any such new employer, before accepting employment, of the terms of this paragraph 6 and Awardee’s continuing obligations contained herein. No provisions of this agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this agreement, the provisions of this agreement shall take precedence and such other inconsistent provisions shall be null and void; provided, further, however, that the provisions of the Employment Agreement and paragraph 13 of this agreement shall take precedence over this paragraph 6(b). Awardee acknowledges and agrees that the restrictions contained in this agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Option, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Option and execution of this agreement are voluntary actions on the part of Awardee and that the Company is unwilling to provide the Option to Awardee without including the restrictions and covenants of Awardee contained in this agreement. Further, the parties agree and acknowledge that the provisions contained in paragraphs 5 and 6 are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made.

7. Right of Set-Off . By accepting this Option, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this agreement.

8. Withholding Tax .

(a) Generally . Awardee is liable and responsible for all taxes owed in connection with the exercise of the Option, regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Option. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the exercise of the Option. The Company does not commit and is under no obligation to structure the Option or the exercise of the Option to reduce or eliminate Awardee’s tax liability.

(b) Payment of Withholding Taxes . Concurrently with the payment of the exercise price pursuant to paragraph 1 hereof, Awardee is required to arrange for the satisfaction of the minimum amount of any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”) in a manner acceptable to the Company. Any manner provided for in subparagraph 1(b) hereof shall be deemed an acceptable manner to satisfy the Tax Withholding Obligation unless otherwise determined by the Company.

9. Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Option, Awardee hereby agrees to hold his or her After-Tax Net Profit in Shares until the first anniversary of the exercise of all or a portion of the Option (or, if earlier, the date of Awardee’s Termination of Employment). “After-Tax Net Profit” means the total dollar value of the Shares that Awardee elects to exercise under this Option at the time of exercise, minus the total of (i) the exercise price to purchase these Shares, and (ii) the amount of all applicable federal, state, local or foreign income, employment or other tax and other similar fees that are withheld in connection with the exercise.

10. Governing Law/Venue . This agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superceded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a substantial relationship to the parties and/or this agreement and that the Option and benefits granted herein would not be granted without the governance of this agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this agreement shall be brought in state or federal courts located in Franklin County, Ohio and the parties executing this agreement hereby consent to the personal jurisdiction of such courts. Awardee acknowledges that the covenants contained in paragraphs 5 and 6 of this agreement are reasonable in nature, are fundamental for the protection of the Company’s legitimate business and proprietary interests, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law. In the event of any violation or attempted violations of the restrictions and covenants of Awardee contained in this agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to

institute legal proceedings under this agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings. Any provision of this agreement which is determined by a court of competent jurisdiction to be invalid or unenforceable should be construed or limited in a manner that is valid and enforceable and that comes closest to the business objectives intended by such provision, without invalidating or rendering unenforceable the remaining provisions of this agreement.

11. Action by the Administrator . The parties agree that the interpretation of this agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this agreement and with regard to any and all matters set forth in this agreement. The Administrator may delegate its functions under this agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “designee”). In fulfilling its responsibilities hereunder, the Administrator or its designee may rely upon documents, written statements of the parties or such other material as the Administrator or its designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its designee and that any decision of the Administrator or its designee relating to this agreement, including without limitation whether particular conduct constitutes Triggering Conduct or Competitor Triggering Conduct, shall be final and binding unless such decision is arbitrary and capricious; provided, however, that to the extent that any provision in this paragraph 11 is inconsistent in any manner with the terms of Section 9(i) of the Employment Agreement, the provisions of the Employment Agreement shall take precedence and such other inconsistent provisions shall be null and void.

12. Prompt Acceptance of Agreement . The Option grant evidenced by this agreement shall, at the discretion of the Administrator, be forfeited if this agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

13. Employment Agreement . Awardee acknowledges that the Option granted hereunder, in tandem with the grant as of the date hereof by the Company to the Awardee of restricted share units in respect of [# of RSUs] Common Shares, satisfy in full the Company’s obligation under Section 3(b)(iii)(B) of the Employment Agreement with respect to incentive awards required to be made not later than September 30, [year] . Sections 3 and 5 of the Employment Agreement set forth certain rules in respect of the treatment of stock options upon the Awardee’s termination of employment, and the Employment Agreement sets forth certain rules in respect of the application of restrictive covenants set forth in stock option agreements to the Awardee. The parties acknowledge that such rules set forth in the Employment Agreement apply to the Option granted hereunder, and further acknowledge that in the event of any conflict between such rules and the terms of this agreement, such rules shall govern.

14. Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Option grant under and participation in the Plan or future options that may be granted under the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of option grants and the execution of option agreements through electronic signature.

15. Notices . All notices, requests, consents and other communications required or provided under this agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

Awardee hereby: (a) acknowledges receiving a copy of the Plan, which has either been previously delivered or is provided with this agreement, and represents that he is familiar with and understands all provisions of the Plan and this agreement; (b) voluntarily and knowingly accepts this agreement and the Option granted to him under this agreement subject to all provisions of the Plan and this agreement, including the provisions in the agreement regarding “Triggering Conduct/Competitor Triggering Conduct” and “Special Forfeiture/ Repayment Rules” set forth in paragraphs 5 and 6 above; and (c) represents that he understands that the acceptance of this agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he manually signed the agreement. Awardee further acknowledges receiving a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders and a copy of the Plan Description dated [date of Plan Description] pertaining to the Plan.

		ROBERT D. WALTER (“Awardee”)
		Signature
		Date

Exhibit 10.08

CARDINAL HEALTH, INC.
RESTRICTED SHARE UNITS AGREEMENT

     On [date of grant] (the “Grant Date”), Cardinal Health, Inc, an Ohio corporation (the “Company”), has awarded to Robert D. Walter (“Awardee”) [# of RSUs] Restricted Share Units (the “Restricted Share Units” or “Award”), representing an unfunded unsecured promise of the Company to deliver common shares, without par value, of the Company (the “Shares”) to Awardee as set forth herein. The Restricted Share Units have been granted pursuant to the Cardinal Health, Inc. 2005 Long-Term Incentive Plan, as amended (the “Plan”), and shall be subject to all provisions of the Plan, which are incorporated herein by reference, and shall be subject to the provisions of this Restricted Share Units Agreement (this “Agreement”). Capitalized terms used in this Agreement which are not specifically defined shall have the meanings ascribed to such terms in the Plan.

     1.  Vesting . Subject to the provisions set forth elsewhere in this Agreement, the Restricted Share Units shall vest in accordance with the following schedule: 33.33% of the Restricted Share Units shall vest on the first anniversary of the Grant Date, an additional 33.33% of the Restricted Share Units shall vest on the second anniversary of the Grant Date, and the final 33.34% of the Restricted Share Units shall vest on the third anniversary of the Grant Date (each such vesting date, the “Vesting Date” with respect to the Restricted Share Units scheduled to vest on such date). Notwithstanding the foregoing, in the event of a Change of Control prior to Awardee’s Termination of Employment, the Restricted Share Units shall vest in full.

     2.  Transferability . The Restricted Share Units shall not be transferable.

     3.  Termination of Employment . Except as set forth below, if a Termination of Employment occurs prior to the vesting of a Restricted Share Unit, such Restricted Share Unit shall be forfeited by Awardee.

     (a)  Termination of Employment by Reason of Death . If a Termination of Employment occurs prior to the vesting in full of the Restricted Share Units by reason of Awardee’s death, then any unvested Restricted Share Units shall vest in full and shall not be forfeited.

     (b)  Termination of Employment by Reason of Retirement or Disability . If a Termination of Employment occurs by reason of Retirement or Disability prior to the vesting in full of the Restricted Share Units, then any Restricted Share Units which have not vested on such date of Termination of Employment will, at the Company’s election, either vest immediately or continue to vest in accordance with the original vesting schedule, provided that, in the case of Retirement, Awardee complies with his obligation to perform consulting services as described in the Second Amended and Restated Employment Agreement, between the Company and Awardee, dated April 17, 2006, as subsequently amended (the “Employment Agreement”). Notwithstanding the foregoing, if Awardee dies after Retirement or Disability, but before the Restricted Share Units are fully vested, the provisions of Paragraph 3(a) of this Agreement shall apply.

     (c)  Other Termination of Employment . For the purposes of this Paragraph 3, Termination of Employment shall mean the termination of both the Employment Period and the Consulting Period under the Employment Agreement, as such terms are defined in the Employment Agreement. Upon a Termination of Employment by the Company without Cause or by the Awardee with Good Reason, as such terms are defined in the Employment Agreement, any Restricted Share Units which have not vested on such date of Termination of Employment will become fully vested as of such date.

     4.  Triggering Conduct/Competitor Triggering Conduct . As used in this Agreement, “ Triggering Conduct ” shall mean engaging in any conduct described in Section 9(b), 9(c), 9(f) or 9(g) of the Employment Agreement. As used herein, “ Competitor Triggering Conduct ” shall mean engaging in any conduct described in Section 9(d) or 9(e) of the Employment Agreement.

     5.  Special Forfeiture/Repayment Rules . For so long as Awardee continues as an Employee with the Cardinal Group and for two years following a Termination of Employment (without regard to the Consulting Period as defined in the Employment Agreement) regardless of the reason, Awardee agrees not to engage in Triggering Conduct. If Awardee engages in Triggering Conduct during the time period set forth in the preceding sentence or in Competitor Triggering Conduct as defined above, then:

     (a) any Restricted Share Units that have not yet vested or that vested within the Look-Back Period (as defined below) with respect to such Triggering Conduct or Competitor Triggering Conduct and have not yet been settled by a payment pursuant to Paragraph 6 hereof shall immediately and automatically terminate, be forfeited, and cease to exist; and

     (b) Awardee shall, within 30 days following written notice from the Company, pay to the Company an amount equal to (x) the aggregate gross gain realized or obtained by Awardee resulting from the settlement of all Restricted Share Units pursuant to Paragraph 6 hereof (measured as of the settlement date (i.e., the market value of the Restricted Share Units on such settlement date)) that have already been settled and that had vested at any time within two years prior to the Triggering Conduct (the “Look-Back Period”), minus (y) $1.00. If Awardee engages only in Competitor Triggering Conduct, then the Look-Back Period shall be shortened to exclude any period more than one year prior to Awardee’s Termination of Employment, but including any period between the time of Termination of Employment and the time of Awardee’s engaging in Competitor Triggering Conduct.

     Awardee may be released from his or her obligations under this Paragraph 5 if and only if the Administrator (or its duly appointed designee) determines, in writing and in its sole discretion, that such action is in the best interests of the Company. Nothing in this Paragraph 5 constitutes a so-called “noncompete” covenant. This Paragraph 5 does, however, prohibit certain conduct while Awardee is associated with the Cardinal Group and thereafter and does provide for the forfeiture or repayment of the benefits granted by this Agreement under certain circumstances, including, but not limited to, Awardee’s acceptance of employment with a Competitor. Awardee agrees to provide the Company with at least 10 days written notice prior to directly or indirectly accepting employment with, or serving as a consultant or advisor or in any other capacity to, a Competitor, and further agrees to inform any such new employer, before accepting employment, of the terms of this Paragraph 5 and Awardee’s continuing obligations contained herein. No provision of this Agreement shall diminish, negate or otherwise impact any separate noncompete or other agreement to which Awardee may be a party, including, but not limited to, any of the Certificates of Compliance with Company Policies and/or the Certificates of Compliance with Company Business Ethics Policies; provided, however, that to the extent that any provisions contained in any other agreement are inconsistent in any manner with the restrictions and covenants of Awardee contained in this Agreement, the provisions of this Agreement shall take precedence and such other inconsistent provisions shall be null and void; provided, further, however, that the provisions of the Employment Agreement and Paragraph 13 of this Agreement shall take precedence over this Paragraph 5(b). Awardee acknowledges and agrees that the provisions contained in this Agreement are being made for the benefit of the Company in consideration of Awardee’s receipt of the Restricted Share Units, in consideration of employment, in consideration of exposing Awardee to the Company’s business operations and confidential information, and for other good and valuable consideration, the adequacy of which consideration is hereby expressly confirmed. Awardee further acknowledges that the receipt of the Restricted Share Units and execution of this Agreement are voluntary actions on the part of Awardee and

that the Company is unwilling to provide the Restricted Share Units to Awardee without including the restrictions and covenants of Awardee contained in this Agreement. Further, the parties agree and acknowledge that the provisions contained in Paragraphs 4 and 5 are ancillary to, or part of, an otherwise enforceable agreement at the time the agreement is made.

     6.  Payment . Subject to the provisions of Paragraphs 4 and 5 of this Agreement, and unless Awardee makes an effective election to defer receipt of the Shares represented by the Restricted Share Units, on the date of vesting of any Restricted Share Unit, Awardee shall be entitled to receive from the Company (without any payment on behalf of Awardee other than as described in Paragraph 11) the Shares represented by such Restricted Share Unit; provided, however, that, subject to the next sentence, in the event that such Restricted Share Units vest prior to the applicable Vesting Date as a result of the death of Awardee or as a result of a Change of Control or otherwise, Awardee shall be entitled to receive the corresponding Shares from the Company on the date of such vesting. Notwithstanding the proviso of the preceding sentence, if Restricted Share Units vest as a result of the occurrence of a Change of Control or otherwise under circumstances where such occurrence would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Code Section 409A applies to such distribution, such proviso shall not apply and Awardee shall be entitled to receive the corresponding Shares from the Company on the date that would have applied absent such proviso. Elections to defer receipt of the Shares beyond the date of settlement provided herein may be permitted in the discretion of the Administrator pursuant to procedures established by the Administrator in compliance with the requirements of Section 409A of the Code.

     7.  Dividend Equivalents . Awardee shall not receive cash dividends on the Restricted Share Units but instead shall, with respect to each Restricted Share Unit, receive a cash payment from the Company on each cash dividend payment date with respect to the Shares with a record date between the Grant Date and the settlement of such unit pursuant to Paragraph 6 hereof, such cash payment to be in an amount equal to the dividend that would have been paid on the Common Share represented by such unit. Cash payments on each cash dividend payment date with respect to the Shares with a record date prior to a Vesting Date shall be accrued until the Vesting Date and paid thereon (subject to the same vesting requirements as the underlying Restricted Share Units award).

     8.  Holding Period Requirement . If Awardee is classified as an “officer” of the Company within the meaning of Rule 16a-1(f) under the Securities Exchange Act of 1934, as amended, on the Grant Date, then, as a condition to receipt of the Restricted Share Units, Awardee hereby agrees to hold, until the first anniversary of the applicable Vesting Date (or, if earlier, the date of Awardee’s Termination of Employment), the Shares issued pursuant to settlement of such units (less any portion thereof withheld in order to satisfy all applicable federal, state, local or foreign income, employment or other tax).

     9.  Right of Set-Off . By accepting these Restricted Share Units, Awardee consents to a deduction from, and set-off against, any amounts owed to Awardee by any member of the Cardinal Group from time to time (including, but not limited to, amounts owed to Awardee as wages, severance payments or other fringe benefits) to the extent of the amounts owed to the Cardinal Group by Awardee under this Agreement.

     10.  No Shareholder Rights . Awardee shall have no rights of a shareholder with respect to the Restricted Share Units, including, without limitation, Awardee shall not have the right to vote the Shares represented by the Restricted Share Units.

     11.  Withholding Tax .

     (a)  Generally . Awardee is liable and responsible for all taxes owed in connection with the Restricted Share Units (including taxes owed with respect to the cash payments described in Paragraph 7 hereof), regardless of any action the Company takes with respect to any tax withholding obligations that arise in connection with the Restricted Share Units. The Company does not make any representation or undertaking regarding the tax treatment or the treatment of any tax withholding in connection with the grant or vesting of the Restricted Share Units or the subsequent sale of Shares issuable pursuant to the Restricted Share Units. The Company does not commit and is under no obligation to structure the Restricted Share Units to reduce or eliminate Awardee’s tax liability.

     (b)  Payment of Withholding Taxes . Prior to any event in connection with the Restricted Share Units (e.g., vesting or settlement) that the Company determines may result in any domestic or foreign tax withholding obligation, whether national, federal, state or local, including any employment tax obligation (the “Tax Withholding Obligation”), Awardee is required to arrange for the satisfaction of the minimum amount of such Tax Withholding Obligation in a manner acceptable to the Company. Unless Awardee elects to satisfy the Tax Withholding Obligation by an alternative means that is then permitted by the Company, Awardee’s acceptance of this Agreement constitutes Awardee’s instruction and authorization to the Company to withhold on Awardee’s behalf the number of Shares from those Shares issuable to Awardee at the time when the Restricted Share Units become vested and payable as the Company determines to be sufficient to satisfy the Tax Withholding Obligation. In the case of any amounts withheld for taxes pursuant to this provision in the form of Shares, the amount withheld shall not exceed the minimum required by applicable law and regulations. The Company shall have the right to deduct from all cash payments paid pursuant to Paragraph 7 hereof the amount of any taxes which the Company is required to withhold with respect to such payments.

     12.  Beneficiary Designation . Awardee may designate a beneficiary to receive any Shares to which Awardee is entitled with respect to the Restricted Share Units which vest as a result of Awardee’s death. Notwithstanding the foregoing, if Awardee engages in Triggering Conduct or Competitor Triggering Conduct as herein defined, the Restricted Share Units subject to such beneficiary designation shall be subject to the Special Forfeiture/Repayment Rules and the Company’s Right of Set-Off or other right of recovery set forth in this Agreement, and all rights of the beneficiary shall be subordinated to the rights of the Company pursuant to such provisions of this Agreement. Awardee acknowledges that the Company may exercise all rights under this Agreement and the Plan against Awardee and Awardee’s estate, heirs, lineal descendants and personal representatives and shall not be limited to exercising its rights against Awardee’s beneficiary.

     13.  Governing Law/Venue . This Agreement shall be governed by the laws of the State of Ohio, without regard to principles of conflicts of law, except to the extent superceded by the laws of the United States of America. The parties agree and acknowledge that the laws of the State of Ohio bear a substantial relationship to the parties and/or this Agreement and that the Restricted Share Units and benefits granted herein would not be granted without the governance of this Agreement by the laws of the State of Ohio. In addition, all legal actions or proceedings relating to this Agreement shall be brought in state or federal courts located in Franklin County, Ohio, and the parties executing this Agreement hereby consent to the personal jurisdiction of such courts. Awardee acknowledges that the covenants contained in Paragraphs 4 and 5 of this Agreement are reasonable in nature, are fundamental for the protection of the Company’s legitimate business and proprietary interests, and do not adversely affect Awardee’s ability to earn a living in any capacity that does not violate such covenants. The parties further agree that in the event of any violation by Awardee of any such covenants, the Company will suffer immediate and irreparable injury for which there is no adequate remedy at law. In the event of any violation or attempted

violations of the restrictions and covenants of Awardee contained in this Agreement, the Cardinal Group shall be entitled to specific performance and injunctive relief or other equitable relief, including the issuance ex parte of a temporary restraining order, without any showing of irreparable harm or damage, such irreparable harm being acknowledged and admitted by Awardee, and Awardee hereby waives any requirement for the securing or posting of any bond in connection with such remedy, without prejudice to the rights and remedies afforded the Cardinal Group hereunder or by law. In the event that it becomes necessary for the Cardinal Group to institute legal proceedings under this Agreement, Awardee shall be responsible to the Company for all costs and reasonable legal fees incurred by the Company with regard to such proceedings. Any provision of this Agreement which is determined by a court of competent jurisdiction to be invalid or unenforceable should be construed or limited in a manner that is valid and enforceable and that comes closest to the business objectives intended by such provision, without invalidating or rendering unenforceable the remaining provisions of this Agreement.

     14.  Action by the Administrator . The parties agree that the interpretation of this Agreement shall rest exclusively and completely within the sole discretion of the Administrator. The parties agree to be bound by the decisions of the Administrator with regard to the interpretation of this Agreement and with regard to any and all matters set forth in this Agreement. The Administrator may delegate its functions under this Agreement to an officer of the Cardinal Group designated by the Administrator (hereinafter the “Designee”). In fulfilling its responsibilities hereunder, the Administrator or its Designee may rely upon documents, written statements of the parties or such other material as the Administrator or its Designee deems appropriate. The parties agree that there is no right to be heard or to appear before the Administrator or its Designee and that any decision of the Administrator or its Designee relating to this Agreement, including, without limitation, whether particular conduct constitutes Triggering Conduct or Competitor Triggering Conduct, shall be final and binding unless such decision is arbitrary and capricious; provided, however, that to the extent that any provisions in this Paragraph 14 are inconsistent in any manner with the terms of Section 9(i) of the Employment Agreement, the provisions of the Employment Agreement shall take precedence and such other inconsistent provisions shall be null and void.

     15.  Employment Agreement . Awardee acknowledges that the Restricted Share Units granted hereunder, in tandem with the grant as of the date hereof by the Company to the Awardee of an option in respect of [# of shares] Common Shares, satisfy in full the Company’s obligation under Section 3(b)(iii)(B) of the Employment Agreement with respect to incentive awards required to be made not later than September 30, [year] . Sections 3 and 5 of the Employment Agreement set forth certain rules in respect of the treatment of restricted share units upon the Awardee’s termination of employment, and the Employment Agreement sets forth certain rules in respect of the application of restrictive covenants set forth in restricted share unit agreements to the Awardee. The parties acknowledge that such rules set forth in the Employment Agreement apply to the Restricted Share Units granted hereunder, and further acknowledge that in the event of any conflict between such rules and the terms of this Agreement, such rules shall govern.

     16.  Prompt Acceptance of Agreement . The Restricted Share Unit grant evidenced by this Agreement shall, at the discretion of the Administrator, be forfeited if this Agreement is not manually executed and returned to the Company, or electronically executed by Awardee by indicating Awardee’s acceptance of this Agreement in accordance with the acceptance procedures set forth on the Company’s third-party equity plan administrator’s web site, within 90 days of the Grant Date.

     17.  Electronic Delivery and Consent to Electronic Participation . The Company may, in its sole discretion, decide to deliver any documents related to the Restricted Share Unit grant under and participation in the Plan or future Restricted Share Units that may be granted under the Plan by electronic

means or to request Awardee’s consent to participate in the Plan by electronic means. Awardee hereby consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company, including the acceptance of restricted share unit grants and the execution of restricted share unit agreements through electronic signature.

     18.  Notices . All notices, requests, consents and other communications required or provided under this Agreement to be delivered by Awardee to the Company will be in writing and will be deemed sufficient if delivered by hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Company at the address set forth below:

Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Chief Legal Officer
Facsimile: (614) 757-2797

All notices, requests, consents and other communications required or provided under this Agreement to be delivered by the Company to Awardee may be delivered by e-mail or in writing and will be deemed sufficient if delivered by e-mail, hand, facsimile, nationally recognized overnight courier, or certified or registered mail, return receipt requested, postage prepaid, and will be effective upon delivery to the Awardee.

		CARDINAL HEALTH, INC.
		By:
		Its:

ACCEPTANCE OF AGREEMENT

Awardee hereby: (a) acknowledges that he has received a copy of the Plan, a copy of the Company’s most recent annual report to shareholders and other communications routinely distributed to the Company’s shareholders, and a copy of the Plan Description dated [ date of Plan Description ] pertaining to the Plan; (b) accepts this Agreement and the Restricted Share Units granted to him under this Agreement subject to all provisions of the Plan and this Agreement, including the provisions in the agreement regarding “Triggering Conduct/Competitor Triggering Conduct” and “Special Forfeiture/ Repayment Rules” set forth in Paragraphs 4 and 5 above; (c) represents that he understands that the acceptance of this Agreement through an on-line or electronic system, if applicable, carries the same legal significance as if he manually signed the Agreement; (d) represents and warrants to the Company that he is purchasing the Restricted Share Units for his own account, for investment, and not with a view to or any present intention of selling or distributing the Restricted Share Units either now or at any specific or determinable future time or period or upon the occurrence or nonoccurrence of any predetermined or reasonably foreseeable event; and (e) agrees that no transfer of the Shares delivered in respect of the Restricted Share Units shall be made unless the Shares have been duly registered under all applicable Federal and state securities laws pursuant to a then-effective registration which contemplates the proposed transfer or unless the Company has received a written opinion of, or satisfactory to, its legal counsel that the proposed transfer is exempt from such registration.

		ROBERT D. WALTER (“Awardee”)
		Signature
		Date

Exhibit 10.09

CARDINAL HEALTH, INC.

Policy Regarding Shareholder Approval of Severance Agreements

Overview : Effective August 3, 2006, the Board of Directors of Cardinal Health, Inc. (“Cardinal Health”) adopts this policy requiring that Cardinal Health obtain shareholder approval before entering into Severance Agreements with Covered Executives that provide Severance Benefits that exceed 2.99 times Base Salary and Bonus as defined and set forth below. If the Board of Directors determines that it is not practical to obtain shareholder approval in advance, the Board may seek shareholder approval after entering into such a Severance Agreement.

Effective date : August 3, 2006

Covered Executives : Officers of Cardinal Health as defined under Section 16 of the Securities Exchange Act of 1934, as amended, at the time a Severance Agreement covered by this Policy is approved.

Severance Agreements : Severance Agreements include any agreement that specifies the compensation payable to a Covered Executive when Cardinal Health terminates employment without cause or when employment is terminated following a change of control of Cardinal Health. Severance Agreements include agreements entered into with Covered Executives (a) after the effective date of the Policy or (b) before the effective date of the Policy, if Severance Benefits are materially modified after the effective date of the Policy.

Base Salary and Bonus Defined : For purposes of the limit on Severance Benefits:

	•		Base salary is the annual rate of base salary in effect at termination.
	•		Bonus is the target incentive amount for the year of termination under the annual and long-term cash incentive compensation plans applicable to the Covered Executive.

Severance Benefits : For purposes of this Policy, “Severance Benefits” generally include:

	•		Cash severance benefits.
	•		The value of other special benefits or perquisites provided for periods after termination of employment (but excluding special benefits provided under any program generally applicable to employees).
	•		Additional retirement benefits earned or vested under qualified and non-qualified retirement plans as a result of termination.

•

The value of any special additional benefit or additional service period “credit” under retirement programs.

Items Excluded as Severance Benefits : For purposes of this Policy, “Severance Benefits” do not include any benefit or payment required by law and:

	•		Amounts earned or accrued for services prior to termination (such as pro rata bonus, unused vacation pay, etc.).
	•		The value of any other benefits provided under programs generally applicable to employees.
	•		The value of “gross-up” payments made in connection with Severance Benefits, including “gross-up” payments under Section Code 280G of the Internal Revenue Code.
	•		The value of accelerated vesting of outstanding equity compensation awards, or other changes in terms of outstanding equity compensation awards.

Exhibit 10.10

FIRST AMENDMENT TO
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     This First Amendment to the Second Amended and Restated Employment Agreement (“Amendment”) is made effective August 2, 2006, by and between Cardinal Health, Inc., an Ohio corporation (the “Company”), and Robert D. Walter (the “Executive”),

     WHEREAS, the Company and the Executive are parties to that certain Employment Agreement originally dated November 20, 2001, and amended and restated on February 1, 2004 and on April 17, 2006, (the “Employment Agreement”);

     WHEREAS, the Company and the Executive have agreed to amend certain provisions of the Employment Agreement;

     NOW, THEREFORE, the parties hereto, in consideration of the mutual covenants herein contained, and intending to be legally bound hereby, agree as follows:

     1. Section 3(b)(vi) of the Employment Agreement is hereby amended by replacing subsections (B) and (C) with the following: “(B) any stock incentive awards granted prior to April 17, 2006 shall vest and become exercisable consistent with the terms of such grant and the Company’s customary practices for senior executives; provided, however, that upon termination of the Employment Period for any reason other than due to the termination of the Executive’s employment for Cause or by the Executive without Good Reason, the Company shall cause any unvested stock options, restricted stock and restricted share units held by the Executive or a permitted transferee (whether granted under this Agreement or otherwise) to either (x) continue to vest in accordance with their original terms during the Consulting Period (referred to in Section 5(e) below); or (y) vest immediately as of the termination of the Employment Period, and in any event, with all such stock options, once vested, remaining exercisable by the Executive or his heirs, successors or assigns until the end of the option term, regardless of whether the Executive remains employed; and (C) any stock incentive awards granted after April 17, 2006 shall vest and become exercisable consistent with the terms of such grant and the Company’s customary practices for senior executives during both the Employment Period and the Consulting Period; provided, however, that upon termination of both the Employment Period and the Consulting Period for any reason other than due to the termination of the Executive’s employment and/or consulting arrangement for Cause or by the Executive without Good Reason (with such definitions to be adjusted to reflect the facts of his consulting arrangements, if applicable), the Company shall cause all such awards to fully vest immediately as of the termination of both the Employment Period and the Consulting Period, and in any event, with all such stock options, once vested, remaining exercisable by the Executive or his heirs, successors or assigns until the end of the option term, regardless of whether the Executive remains employed or continues to serve as a consultant.”

     2. Section 5(d) of the Employment Agreement is hereby amended by replacing the second sentence with the following: “Additionally, unless the award agreement with respect to an individual stock option, restricted stock or restricted share unit award otherwise provides for immediate and full vesting, for purposes of the vesting of any stock options, restricted stock or restricted share units held by the Executive or a permitted transferee (whether granted under this Agreement or otherwise), if the Executive’s employment is terminated by reason of the Executive’s Disability during the Employment Period or the Executive’s retirement at any time after June 30, 2004, and if (in the case of retirement) following such termination of employment the Executive complies with his obligation to perform consulting services as described in Section 5(e), then (unless the Company elects to immediately vest such awards pursuant to Section 3(b)(vi)(B)(y)) the Executive shall be treated as a consulting employee and any such options, restricted stock or restricted share units shall continue to vest in accordance with

their original vesting schedule (with all such stock options, once vested, remaining exercisable by the Executive or his heirs, successors or assigns until the end of the option term).”

     3. Except as specifically amended by the provisions of this Amendment, all terms of the Employment Agreement are unmodified and remain in full force and effect

IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the authorization from its Board of Directors, the Company has caused these presents to be executed in its name and on its behalf, all as of the day and year first above written.

/s/ Robert D. Walter		/s/ John B. McCoy
ROBERT D. WALTER		CARDINAL HEALTH, INC.
Execution Date: August 2, 2006		Execution Date: August 2, 2006
		By: John B. McCoy