(b), (c), (d) and (e)

Clark and Schlotterbeck Resignations

On August 4, 2009, R. Kerry Clark, the Company's Chairman and Chief Executive Officer, delivered to the Company's board of directors (the "Board") and to the Company a notice of intent to terminate his employment with the Company for "Good Reason" (as defined in his employment agreement, dated April 17, 2006, as amended), and to resign as Chairman and Chief Executive Officer and from his position on the Board, effective immediately following the consummation of the Spin-Off. Upon his resignation, Mr. Clark will become entitled to the payments and benefits described in his employment agreement upon a resignation for Good Reason attributable to the "CMP Spinoff," as defined and described in his employment agreement. Mr. Clark's employment agreement has been previously filed with the U.S. Securities and Exchange Commission (the "SEC").

Also on August 4, 2009, David L. Schlotterbeck, the Company's Vice Chairman of Cardinal Health and Chief Executive Officer, Clinical and Medical Products, tendered his resignation conditioned on, and effective as of, the Spin-Off from the positions he holds with the Company and its subsidiaries. Mr. Schlotterbeck is expected to be CareFusion's Chairman of the Board and Chief Executive Officer following the Spin-Off.

Barrett Appointment as Chairman and Chief Executive Officer and Employment Agreement

On August 5, 2009, the Company entered into an employment agreement with George S. Barrett (the "Barrett Agreement") under which he will serve as Chairman and Chief Executive Officer of the Company effective at the time of consummation of the Spin-Off and ending on the earlier of (i) the date of the Company's annual meeting of shareholders following June 30, 2012, or
(ii) December 31, 2012, subject to earlier termination as described below. On August 5, 2009, Mr. Barrett was elected to the Board for a term beginning on the date of the consummation of the Spin-Off and continuing through the Company's 2009 annual meeting of shareholders, and until his successor is elected and qualified or until his earlier resignation, removal from office or death. He will become a member of the Board's Executive Committee effective upon his appointment as Chairman and Chief Executive Officer of the Company.

Mr. Barrett, age 54, has served as Vice Chairman of Cardinal Health and Chief Executive Officer, Healthcare Supply Chain Services of the Company since January 2008. Prior to joining the Company, he held several positions with Teva Pharmaceutical Industries Limited, a global pharmaceutical company. From November 2006 to January 2008, he was President and Chief Executive Officer of Teva North America and Executive Vice President-Global Pharmaceutical Markets and a member of the Office of the Chief Executive Officer for Teva Pharmaceutical Industries. He was President and Chief Executive Officer of Teva North America and Group Vice President-North America of Teva Pharmaceutical Industries from 2005 to 2006. Prior to that, Mr. Barrett served as President of Teva USA from 1998 to 2005.

The Barrett Agreement is filed with this report as Exhibit 10.1, and this description is qualified by reference to the agreement. The Barrett Agreement is subject to the consummation of the Spin-Off, and if the Spin-Off is not consummated by December 31, 2009, the effective date will not occur and the Barrett Agreement will not become effective.

• an annual base salary of not less than $1,200,000, subject to discretionary increases;

• a target annual bonus of not less than 130% of his annual base salary payable based on performance objectives to be determined by the Board's Human Resources and Compensation Committee (the "Committee") in consultation with him;

• grant of an initial equity award on the 15th of the calendar month following the Spin-Off (expected to be September 15, 2009) consisting of
(a) restricted share units ("RSUs") with a grant date value of $1,750,000 that will vest ratably over three years, and (b) an option to purchase common shares with a grant date value of $2,250,000 that will have an exercise price equal to the closing price of the common shares on the New York Stock Exchange ("NYSE") on the date the option is granted and will vest ratably over three years, subject to adjustment to satisfy the annual share limit in the Company's 2005 Long-Term Incentive Plan, as amended and restated as of November 5, 2008 (as adjusted to reflect the Spin-Off);

• target long-term incentive awards commencing with fiscal 2010 of no less than 600% of his annual base salary, in the form of stock options, RSUs and other long-term incentives as determined by the Committee, resulting in, for fiscal 2010, an annual grant on September 15, 2009 of (a) RSUs with a grant date value of $2,520,000 that will vest ratably over three years, and
(b) an option to purchase common shares with a grant date value of $4,680,000 that will have an exercise price equal to the closing price of the common shares on the NYSE on the date the option is granted, will vest ratably over three years and will expire seven years from the date of grant;

• during the employment period, personal use of Company aircraft, subject to availability and without any tax reimbursement; provided that any personal use which would cause the amount reported in the Company's annual proxy statement to equal or exceed $100,000 will require the advance approval of the Committee;

• reimbursement on an after-tax basis for all reasonable expenses in connection with his relocation to Dublin, Ohio; and

• eligibility to participate in the Company's savings and retirement plans, welfare benefit plans, fringe benefits and perquisite programs and deferred compensation plan, and paid vacation, in accordance with plans and policies in effect for other senior executives.

In addition, during his employment and for two years afterward, he will not:

• recruit employees from the Company;

• solicit customers and potential customers of the Company for a competitor; or

• invest in, counsel or be employed by a competitor of the Company.

If Mr. Barrett terminates his employment for "Good Reason" or the Company terminates Mr. Barrett's employment other than for "Cause," death or "Disability" (as each term is defined in the Barrett Agreement), Mr. Barrett will receive, among other things:

• earned but unpaid salary through the date of termination and unpaid annual cash incentive from the prior fiscal year;

• cash severance in the amount of two times the sum of his annual base salary and target annual cash incentive (payable over 24 months);

• all vested stock options held by him at the time of termination will remain exercisable for a period of two years; and

• medical and dental benefits for him and his eligible dependents for a period of two years.

If Mr. Barrett's employment is terminated by death or Disability, he will receive, among other things, the benefits listed under the first, second, fourth and fifth bullets above. If Mr. Barrett's employment is terminated upon the expiration of the term of the Barrett Agreement, he will receive, among other things, the benefits listed in the first and second bullets above. If the Company terminates his employment for Cause or if Mr. Barrett terminates his employment without Good Reason, he will receive the benefits listed in the first bullet above.

The Barrett Agreement provides that if Mr. Barrett receives any payments that are subject to the excise tax imposed on "parachute payments" under the Internal Revenue Code on account of a transaction occurring within 18 months following the effective date of the Barrett Agreement, the Company will pay him a gross-up payment so that he retains an amount of the gross-up payment equal to the excise tax, after payment of all taxes on that gross-up payment. This provision modifies the right that Mr. Barrett had in his original offer letter to receive this form of gross-up payment throughout his employment with the Company. Mr. Barrett is not entitled to any such gross-up payment for transactions occurring after such 18 month period.

If the Company's financial statements are restated following the Spin-Off and Mr. Barrett engaged in misconduct that caused or materially contributed to the restatement, the Company has the right to recoup bonus or other compensation paid to Mr. Barrett if, based on the financial statements as restated, he otherwise would not have received such compensation. This right of recoupment applies to compensation granted or vesting not later than three years following the date on which the subject financial statements were originally filed with the SEC.

Director election and committee appointments

On August 5, 2009, the Board appointed Bruce L. Downey to serve on the Audit Committee of the Board, effective upon his joining the Board. As previously disclosed, on July 2, 2009, the Board elected Mr. Downey to serve as a director, effective upon the Spin-Off. Mr. Downey is a Partner in NewSpring Health Capital II, L.P., a venture capital firm, and previously served as Chairman and Chief Executive Officer of Barr Pharmaceuticals, Inc.

Also on August 5, 2009, the Board elected Glenn A. Britt to serve as a member of the Board, effective October 1, 2009, to serve until the 2009 annual meeting of shareholders, and until his successor is elected and qualified or until his earlier resignation, removal from office or death. Mr. Britt was appointed to serve on the Audit Committee of the Board, effective upon his joining the Board. He is Chairman, President and Chief Executive Officer of Time Warner Cable Inc.

Mr. Britt will participate in the standard non-management director compensation arrangements described in the Company's 2008 proxy statement, including an initial equity award on the effective date of his election to the Board. Accordingly, effective on the date of his becoming a director, Mr. Britt will be granted an option to purchase common shares with a grant date value of $78,000 and RSUs with a grant date value of $42,000. The option and RSUs will vest in full one year from grant. Options are granted with an exercise price equal to the closing price of a common share on the NYSE on the grant date and will be exercisable for seven years from the grant date.

The Company also will enter into its standard directors' indemnification agreement with Mr. Britt, in the form previously filed by the Company as Exhibit 10.38 to its annual report on Form 10-K for the fiscal year ended June 30, 2004. The agreement generally provides, among other things, that the director will be indemnified to the fullest extent permitted by law and advanced expenses in connection with the defense of any proceedings.

Annual Incentive Payments

On August 4, 2009, the Committee approved the following payouts of fiscal 2009
annual incentive compensation under the Cardinal Health, Inc. Amended and
Restated Management Incentive Plan, as amended (the "MIP"), to the Company's
named executives:



                                                                       Fiscal 2009
                                                                          Annual
                                                                        Incentive
Name                                                                   Compensation
R. Kerry Clark
Chairman and Chief Executive Officer                                  $      696,000
Jeffrey W. Henderson
Chief Financial Officer                                               $      280,000
George S. Barrett
Vice Chairman of Cardinal Health and Chief Executive Officer,
Healthcare Supply Chain Services                                      $      390,000
David L. Schlotterbeck
Vice Chairman of Cardinal Health and Chief Executive Officer,
Clinical and Medical Products                                         $            0

In August 2008, the Committee established performance goals under the MIP for fiscal 2009 based upon the achievement of a specified level of earnings before interest and taxes ("EBIT") and return on tangible capital ("ROTC"). A named executive could receive a cash award of 0-200% of the executive's annual incentive target, with a threshold cash award level of 60% if a minimum level of both EBIT and ROTC was obtained. If the Company did not achieve the minimum performance goals with respect to either EBIT or ROTC, but it did satisfy the
Section 162(m) overall company performance criterion of a specified level of return on equity ("ROE"), then any cash awards would be in the discretion of the Committee.

For fiscal 2009, the Company did not achieve the minimum performance goals with respect to either EBIT or ROTC, but satisfied the overall company performance criterion of a specified level of ROE. The Committee exercised discretion to fund the MIP and to determine the actual amount of the named executive's annual incentive compensation. In doing so, the Committee recognized that the primary reason for the Company's below target EBIT performance was the impact of the . . .

(d) Exhibits

10.1 Employment Agreement, dated August 5, 2009, between Cardinal Health, Inc. and George S. Barrett