Employment Agreement

Change in Control

 

 

 

EX-99.3 4 exhibit3.htm EX-99.3

Exhibit 99.3

EMPLOYMENT AGREEMENT  

THIS AGREEMENT, dated as of December   , 2009, is made by and between Nordson Corporation, an Ohio corporation (the “Company”), and Michael F. Hilton (the “Executive”), and is effective as of January   , 2010 (the “Effective Date”).   

RECITALS:  

WHEREAS, the Company desires to employ Executive on the terms set forth in this Agreement, and Executive desires to accept such employment under such terms.

NOW, THEREFORE, in consideration of the foregoing intentions and of the respective covenants and agreements set forth below, the parties hereto agree as follows:  

1. Employment. The Company hereby employs Executive as its President and Chief Executive Officer upon the other terms and conditions provided herein. Executive hereby accepts such employment. The term of employment under this Agreement (the “Term”) shall be for the period beginning upon the Effective Date and ending upon the Date of Termination under Sections 6 and 7 of this Agreement. Executive will report to the Company’s Board of Directors (the “Board”).

2. Duties. During the Term, Executive will have the customary duties, responsibilities and authorities of an executive serving the position of President and Chief Executive Officer, subject in all cases to the power of the Board to expand or limit such duties, responsibilities and authorities, either generally or in specific instances. Executive’s workplace shall be located at the Company’s principal office in Westlake, Ohio.

3. Executive’s Efforts.

(a) During the Term, Executive shall devote substantially all of his business time (excluding periods of vacation and other approved leaves of absence) to the performance of his duties with the Company, its subsidiaries and affiliates. Executive will perform his duties and responsibilities to the best of his ability in a diligent, trustworthy, and businesslike manner. Executive will at all times abide by and observe the Company’s Code of Business and Ethical Conduct.

(b) The foregoing shall not prevent Executive from (i) participating in charitable, civic, educational, professional, community or industry affairs or, with prior written approval of the Board, serving on the board of directors or advisory boards of other companies; and (ii) managing his and his family’s personal investments, so long as such activities do not materially interfere with the performance of his duties hereunder or create a potential business conflict or the appearance thereof. If at any time service on any board of directors or advisory board would, in the good faith judgment of the Board, conflict with Executive’s fiduciary duty to the Company or create any appearance thereof, Executive shall, as soon as reasonably practicable considering any fiduciary duty to the other entity, resign from such other board of directors or advisory board after his receipt of written notice from the Board as to the conflict.

4. Certain Definitions.  

(a) “Annual Base Salary” shall have the meaning set forth in Section 5(a).  

(b) “Notice of Award” shall mean the written notice from the Company to Executive pursuant to which Executive is informed of a grant of an option to purchase Common Stock, or other equity-based award made under the Long-Term Performance Plan.

(c) “Board” shall mean the Board of Directors of the Company.  

(d) “Cause” shall mean any of the following: (i) commission of a felony or an act or series of acts that results in material injury to the business or reputation of the Company or any subsidiary; (ii) willful failure to perform duties of employment, if such failure has not been cured in all material respects within twenty (20) days after the Company or any subsidiary, as applicable, gives notice thereof; or (iii) breach of any material term, provision or condition of employment, which breach has not been cured in all material respects within twenty (20) days after the Company or any subsidiary, as applicable, gives notice thereof, or (iv) Executive materially fails to comply with the Company’s Code of Business and Ethical Conduct.  

(e) “Change in Control” shall have the meaning set forth in the Change-in-Control Retention Agreement between the Company and Executive (the “Change-in-Control Retention Agreement”).

(f) “Code” shall mean the Internal Revenue Code of 1986, as amended. Reference to a Section of the Code includes all rulings, regulations, notices, announcements, decisions, orders and other pronouncements that are issued by the United States Department of the Treasury, the Internal Revenue Service, or any court of competent jurisdiction, that are lawful and pertinent to the interpretation, application or effectiveness of such Section.

(g) “Common Stock” shall mean the common shares of the Company without par value.  

(h) “Company” shall mean Nordson Corporation, an Ohio corporation, the principal office of which is in Westlake, Ohio.  

(i) “Compensation Committee” shall mean the Compensation Committee of the Board whose members shall be appointed by the Board from time to time.  

(j) “Date of Termination” shall mean (i) if Executive’s employment is terminated by reason of his death, the date of his death, and (ii) if Executive’s employment is terminated pursuant to Sections 6(a)(ii) — (vii), the date specified in the Notice of Termination.  

(k) “Disability” shall mean the inability of Executive to perform his duties and responsibilities as an officer or employee of the Company or any of its subsidiaries on a full-time basis due to a physical, mental or emotional incapacity resulting from injury, sickness or disease, meeting the standards set forth in the Nordson Corporation Long-Term Disability Plan, and as determined by the Compensation Committee.  

(l) “Effective Date” shall mean January   , 2010.

(m) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.  

(n) “Executive” shall mean Michael F. Hilton.  

(o) “Good Reason” shall mean the occurrence of any of the following: (i) a material diminution in Executive’s title, duties or responsibilities, without his prior written consent, (ii) a material diminution of Executive’s Annual Base Salary, without his prior written consent, (iii) material failure by the Company to make available to Executive compensation plans, employee pension plans, and employee welfare plans and other benefits and perquisites that provide opportunities to receive overall compensation and benefits and perquisites at least equal to the opportunities for overall compensation and benefits and perquisites that were available to Executive immediately prior to the action by the Company constituting such failure, (iv) the Company requires Executive, without his prior written consent, to be based at any office or location that requires a relocation greater than 50 miles from Westlake, Ohio, or (v) any material breach of this Agreement by the Company; provided, however, that for purposes of a Change in Control, “Good Reason” shall have the meaning set forth in the Change-in-Control Retention Agreement. 

  

(p) “Long-Term Performance Plan” shall mean the Amended and Restated Nordson Corporation 2004 Long-Term Performance Plan.

(q) “Management Incentive Plan” shall mean the Amended and Restated Nordson Corporation 2004 Management Incentive Plan.

(r) “Notice of Termination” shall have the meaning set forth in Section 6(b).  

(s) “Options” as of any date of determination shall mean options held by Executive as of such date to purchase Common Stock of the Company.  

(t) “Term” shall have the meaning set forth in Section 1.  

5. Compensation and Related Matters.  

(a) Annual Base Salary.  During the Term, Executive shall receive a base salary at a rate that is no less than $675,000 per annum (the “Annual Base Salary”), payable in accordance with the Company’s normal payroll practices.  The rate of the Annual Base Salary shall be reviewed by the Compensation Committee periodically, at least annually, and any increases in Annual Base Salary will be based upon performance and consideration of competitive market practice with any decrease occurring only if such a decrease also applies proportionately to all Named Executive Officers of the Company 

(b) Bonus.  For each fiscal year of the Company during the Term, Executive shall be eligible to participate in the Management Incentive Plan in accordance with terms and provisions thereof (the payment in satisfaction of an Incentive Award under the Management Incentive Plan, a “Bonus”). Subject to Compensation Committee discretion, Executive will be paid a respective Bonus amount for the achievement of “threshold,” “target,” and “maximum” level under pre-established performance goals (with no Bonus paid for achievement below threshold level, Bonus paid at ninety percent (90%) of Annual Base Salary for achievement of target level, and one hundred eighty percent (180%) of Annual Base Salary for achievement above maximum level). Notwithstanding the foregoing to the contrary, for the Company fiscal year beginning on November 1, 2009, and ending on October 31, 2010, Executive will receive a Bonus of not less than ninety percent (90%) of Annual Base Salary actually received from the Effective Date through October 31, 2010. Nothing in this Agreement shall preclude the Company from amending or terminating the Management Incentive Plan and such amendments or termination shall otherwise apply to Executive as long as such amendments or termination are of general and uniform application to all Named Executive Officers of the Company.

(c) Initial Equity Grant. Contemporaneous with the Effective Date, the Company shall grant to Executive an equity award (the “Initial Equity Grant”) equal to $210,000 (the number of shares of Common Stock constituting the Initial Equity Grant shall be determined by dividing $210,000 by the closing share price of Common Stock on the Effective Date and rounding to the nearest whole share). The Common Stock contained in the Initial Equity Grant may not be transferred, pledged, hypothecated or otherwise alienated until three years after the Effective Date, and shall be subject to forfeiture in the event of a voluntary termination of employment or termination of employment for cause prior to such date. The Initial Equity Grant shall be evidenced by a Notice of Award.

(d) Long-Term Incentive Compensation.  During the Term, Executive shall be entitled to participate in the Long-Term Performance Plan or any successor plan thereto, or any other long-term incentive plan implemented by the Company, at a level that is competitive with market practices, as determined by the Compensation Committee. Contemporaneous with the Effective Date, Executive shall receive certain Awards under the Long-Term Performance Plan (the “Initial Long-Term Performance Plan Awards”), which shall include: (i) nonqualified Options equal to $750,000 as of the Effective Date (as determined under the Black-Scholes valuation methodology), and (ii) for Executive’s participation in the Company’s FY 2010 — FY 2012 Long-Term Incentive Plan, Performance Share Units equal to $750,000 as of the Effective Date (as determined under the Long-Term Performance Plan, using the closing share price of Common Stock on the Effective Date). The Initial Long-Term Performance Plan Awards shall be evidenced by a Notice of Award reflecting their respective terms, which terms shall be consistent with this Agreement. The Performance Share Units shall convert into shares of Common Stock at a rate based upon the achievement of respective pre-established Performance Objectives established by the Compensation Committee for the FY 2010 - FY 2012 Long-Term Incentive Plan.

(e) Initial Conditional Cash Award. In the event that Executive forfeits any payout under the executive officer cash opportunity (i.e., bonus) plan maintained by Air Products and Chemicals, Inc. for the performance period ending in December 2009 by reason of his acceptance of employment with the Company under this Agreement, the Company will make a one-time cash payment of $166,000 (the “Initial Conditional Cash Award”). Such Initial Conditional Cash Award shall be paid in the first Base Salary payment cycle following the Effective Date, subject to Executive providing a written statement declaring the denial of such payout.

(f) Supplemental Retirement Benefits. Executive shall be eligible to participate in the Nordson Corporation Amended and Restated 2005 Excess Defined Benefit Pension Plan, the Nordson Corporation Amended and Restated 2005 Excess Defined Contribution Benefit Plan, and the Amended and Restated Nordson Corporation 2005 Deferred Compensation Plan in accordance with the respective terms thereof.

(g) Special Supplemental Individual Pension Benefit. The Company shall establish and provide to Executive an individual nonqualified pension benefit (the “Supplemental Individual Pension Benefit”) that shall treat Executive as if he were fully vested in the Nordson Corporation Salaried Employees Pension Plan, solely in the event that Executive experiences a Termination due to Death, Termination due to Disability, Termination without Cause or Resignation with Good Reason (whether or not in connection with a Change in Control), each in accordance with Section 6, prior to becoming one hundred percent (100%) vested in the Nordson Corporation Salaried Employees Pension Plan. Such Supplemental Individual Pension Benefit shall provide for payment to commence as soon as permissible following the Date of Termination, subject to the requirements described in Section 7(g) and (h). Once Executive has accrued sufficient service to be fully vested in the Nordson Corporation Salaried Employees Pension Plan, the Company shall have no obligation to provide the Supplemental Individual Pension Benefit. Such Supplemental Individual Pension Benefit shall be evidenced by a separate agreement which shall be consistent with the terms of this Agreement.

(h) Mandatory Deferral of Compensation. The Executive will not be required to defer any amounts of compensation during calendar year 2010 which may not be tax deductible to the Company under the provisions of Section 162(m) of the Internal Revenue Code. Thereafter, the Compensation Committee shall have the unilateral right to require Executive to defer compensation payable under this Agreement into the Amended and Restated Nordson Corporation 2005 Deferred Compensation Plan in the event that such compensation is determined by the Compensation Committee not to be deductible under Code Section 162(m). Such deferral, if made, shall be made for a period of time necessary to ensure that the compensation payments are deductible under Code Section 162(m) and shall be made in accordance with the requirements of Code Section 409A.

(iChange-in-Control Retention Agreement. Upon the Effective Date, Executive shall be given the opportunity to execute and participate in the benefits conferred under the Company’s present Change-in-Control Retention Agreement. Nothing in this Agreement, however, is to be construed to limit the ability of the Company to change, alter, amend or terminate the Change-in-Control Retention Agreement; provided, however, that in the event the Company takes such action, and the aggregate value of the benefits provided under Section 7(b) are greater than those that would be provided under the combination of those provided under Section 7(c) and the Change-in-Control Retention Agreement at such time, then Executive may elect to be paid or conferred benefits under Section 7(b) of this Agreement upon a Termination without Cause or Resignation for Good Reason following a Change in Control.

(j) Relocation Benefits. Executive shall be entitled to relocation benefits in accordance with the Nordson Standard Relocation Assistance program. In addition, the Company shall reimburse Executive for any cash loss on the sale of Executive’s primary residence (determined as of the time of sale) up to a maximum of $500,000. Any cash loss shall be determined based upon the purchase price of Executive’s primary residence plus the cost of any capital improvements to the residence that qualify for addition to the tax basis of the residence. Executive shall provide written evidence for the value of any loss claimed under this paragraph.

(k) Other Employee Benefits. During the Term, Executive shall be entitled to participate in the other employee benefit plans, programs and arrangements of the Company now (or, to the extent determined by the Board or Compensation Committee, hereafter) in effect which are applicable to the senior officers of the Company generally, subject to and on a basis consistent with the terms, conditions and overall administration thereof (including the right of the Company to amend, modify or terminate such plans).  

(l) Expenses.  Pursuant to the Company’s customary policies in force at the time of payment, Executive shall be reimbursed for all expenses properly incurred by Executive on the Company’s behalf in the performance of Executive’s duties hereunder. In addition, The Company will reimburse Executive for reasonable legal expenses and attorneys’ fees incurred by Executive in connection with the review of this Employment Agreement, up to a maximum of $15,000.

  (m) Paid Time Off/Paid Holidays.  Executive shall be entitled to thirty-five (35) annual paid time off days per year, in accordance with the Company’s Paid Time Off policy as in effect as of the Effective Date, and as may be amended from time to time.  Executive also shall be entitled to paid holidays in accordance with the Company’s practices with respect to same as in effect as of the Effective Date, as may be amended from time to time.  

(n) Club Membership.  During the Term, the Company shall pay on behalf of Executive, or reimburse Executive for, the initiation fee and the monthly membership fee payable in connection with Executive’s membership in The Union Club in Cleveland, Ohio.  

(o) Tax and Financial Planning Assistance.  During the Term, the Company shall, upon submission of proper documentation, pay on behalf of Executive, or reimburse Executive, for reasonable expenses incurred for professional assistance in planning and preparing his tax returns and managing his financial affairs, including estate planning, provided that such expenses do not exceed $5,000 per fiscal year, or such other amount as the Compensation Committee may establish from time to time for the Named Executive Officers.

(p) Annual Executive Physical. The Company will provide Executive with the opportunity to receive an annual physical examination consistent with the benefit provided to the other Named Executive Officers from time to time.

6. Termination 

(a) Executive’s employment hereunder, and this Agreement, may be terminated by the Company or Executive, as applicable, without any breach of this Agreement under the following circumstances and in accordance with Section 6(b):  

(iDeath.  Executive’s employment hereunder shall terminate upon his death.  

(ii) Disability.  If the Company determines in good faith that Executive has incurred a Disability, the Company may provide Executive written notice of its intention to terminate Executive’s employment.  In such event, Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by Executive, provided that within such 30 day period Executive shall not have returned to full-time performance of his duties.   

(iii) Termination for Cause.  The Company may terminate Executive’s employment hereunder for Cause.  

(iv) Resignation for Good Reason.  Executive may resign his employment hereunder for Good Reason.  

(v) Termination without Cause.  The Company may terminate Executive’s employment hereunder without Cause.  

(vi) Resignation without Good Reason.  Executive may resign his employment hereunder without Good Reason.

(vii) Termination due to Retirement. Executive may voluntarily resign his employment upon or after reaching Normal Retirement Age as that term is defined under the Nordson Corporation Salaried Employees Pension Plan (or, if that plan has been terminated, as defined under any successor plan or any annuity contract funding the termination of such plan).

 

(b) Notice of Termination.  Any termination of Executive’s employment by the Company or by Executive under this Section 6 (other than termination pursuant to Section 6(a)(i)) shall be communicated by a written notice from the Board or Executive to the other, indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated, and specifying a Date of Termination which, except in the case of Termination by reason of Disability or Termination for Cause pursuant to Section 6(a)(ii) or 6(a)(iii), respectively, shall be at least 90 days following the date of such notice (a “Notice of Termination”).  In the event of Termination for Cause pursuant to Section 6(a)(iii), Executive shall have the right, if the basis for such Cause is curable, to cure the same within thirty (30) days following the Notice of Termination for Cause, and Cause shall not be deemed to exist if Executive cures the event giving rise to Cause within such 30-day period. In the event of termination for Cause pursuant to Section 6(a)(iii) where the basis for such Cause is not curable, the Date of Termination shall be no earlier than thirty (30) days following the Notice of Termination; provided, however, in no event shall the giving of such Notice of Termination for Cause and the subsequent actions taken by the Company to reduce the responsibilities of Executive or to remove Executive from office be construed as factors giving to Executive the right declare that he has Good Reason to resign during any such notice period.  In the event of Termination by Executive for Good Reason pursuant to Section 6(a)(iv), the Company shall have the right, if the basis for such Good Reason is curable, to cure the same within thirty (30) days following the Notice of Termination for Good Reason, and Good Reason shall not be deemed to exist if the Company cures the event giving rise to Good Reason within such 30-day period. Executive must provide written notice to the Company of any condition constituting Good Reason within ninety (90) days of the initial existence of such a condition. Executive shall continue to receive his Annual Base Salary, Bonus and all other compensation and perquisites referenced in Section 5 through the Date of Termination.  

7. Payments and Benefits Upon Termination.  

(a) Termination for any Reason.  In the event Executive’s employment with the Company is terminated for any reason, the Company shall pay Executive (or his beneficiary in the event of his death) any unpaid Annual Base Salary that has accrued as of the Date of Termination, and any unreimbursed expenses due to Executive.  Executive also shall be entitled to accrued, vested benefits under the Company’s benefit plans and programs as provided therein, and the terms of any applicable Notice of Award will govern such benefits to the extent applicable.  Executive shall be entitled to the additional payments and benefits described below only as set forth herein.  

(b) Termination without Cause or Resignation for Good Reason (Not Following Change in Control). Subject to Section 7(c), (g) and (h) and the restrictions contained herein, in the event of Executive’s Termination without Cause (pursuant to Section 6(a)(v)) or Resignation for Good Reason (pursuant to Section 6(a)(iv)), and where such Termination without Cause or Resignation for Good Reason does not occur within two (2) years following the effective date of a Change in Control, the Company shall pay to Executive the amounts described in Section 7(a). In addition, subject to Section 7(g) and (h) and the restrictions contained herein, the Company shall do all of the following:

(i) The Company shall pay to Executive, in a single cash payment, (a) an amount equal to two (2) times the Annual Base Salary at the rate in effect on the Date of Termination, and (b) an amount equal to two (2) times the greater of (x) ninety percent (90%) of Annual Base Salary, or (y) the target Bonus payable under Section 5(b).

(ii) The Company shall pay to Executive, in a single cash payment, a prorated amount of the Bonus payable under Section 5(b) for such fiscal year based upon actual performance in such fiscal year, as determined at the end of the applicable performance period.. Such payment shall be made in a lump sum by the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.” For this purpose, the term “substantial risk of forfeiture” shall be determined within the meaning of Treasury Regulations Section 1.409A-1(b)(4) and (d).

(iii) The Company shall settle on a prorata basis any awards granted Executive under the Long-Term Performance Plan for any performance period(s) not completed on the Date of Termination based upon actual performance in each such applicable performance period, as determined at the end of the applicable performance period. Such settlement shall be made in a lump sum after the end of the applicable performance period with respect to which it is to be calculated, and after the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.”

(iv) The Company shall permit Executive to exercise all vested but unexercised Options in accordance with the terms of the applicable Notice of Award.

(v) Executive immediately shall become fully vested in his benefits under the Supplemental Individual Pension Benefit.

(vi) Any restrictions on transfer of the Initial Equity Grant or subsequent restricted Common Stock grants shall lapse as of the Date of Termination.

(vii) The Company shall continue certain of Executive’s benefits under this Agreement for a period of twenty four (24) months following the Date of Termination (for purposes of this Section 7(b)(vii), the “Continued Benefits”). The Continued Benefits shall include health care benefits, dental benefits, prescription drug benefits and vision care benefits. Any rights that Executive and/or his qualified beneficiaries may have to continuation of health plan coverage in accordance with the requirements of applicable law (e.g. “COBRA coverage” under the Employee Retirement Income Security Act of 1974) shall run concurrently with the continuation of welfare benefits under this Section 7(b)(vii), such that Executive will timely elect such continuation coverage and the Company shall be responsible for necessary premium payments on behalf of Executive. The Company may require Executive to complete and file any election forms that are generally required of other employees to obtain COBRA coverage; and Executive’s COBRA coverage may be terminable in accordance with applicable law.

(c) Termination without Cause or Resignation for Good Reason (Following Change in Control). In the event of Executive’s Termination without Cause (pursuant to Section 6(a)(v)) or Resignation for Good Reason (pursuant to Section 6(a)(iv)), and where such Termination without Cause or Resignation for Good Reason occurs within two (2) years following the effective date of a Change in Control, the Company shall pay to Executive the amounts described in Section 7(a) as well as any compensation or benefits to which Executive is entitled under the Change-in-Control Retention Agreement between the Company and Executive, but Executive shall not be entitled to benefits described under Section 7(b) of this Agreement. In addition, but only to the extent not otherwise provided under the Change-in-Control Retention Agreement:

(i) Executive shall immediately become fully vested in the Supplemental Individual Pension Benefit and the Company shall credit Executive with an additional two (2) years of service credit and add an additional two (2) years to Executive’s age for purposes of determining the benefit under the Supplemental Individual Pension Benefit.

(ii) The Company shall pay to Executive, in a single cash payment, a prorated amount of the Bonus payable under Section 5(b) for such fiscal year based upon actual performance in such fiscal year, as determined at the end of the applicable performance period. Such payment shall be made in a lump sum by the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.” For this purpose, the term “substantial risk of forfeiture” shall be determined within the meaning of Treasury Regulations Section 1.409A-1(b)(4) and (d).

(iii) The Company shall settle on a prorata basis any awards granted Executive under the Long-Term Performance Plan for any performance period(s) not completed on the Date of Termination based upon actual performance in each such applicable performance period, as determined at the end of the applicable performance period. Such settlement shall be made in a lump sum after the end of the applicable performance period with respect to which it is to be calculated, and after the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.”

(iv) Executive shall immediately become fully vested in any accrued but unvested benefits, if any, under the Amended and Restated Nordson Corporation 2005 Deferred Compensation Plan.

(v) Executive shall immediately become fully vested in all Options granted under the Long-Term Performance Plan.

(vi) All restrictions upon any Common Stock granted to Executive under the Long-Term Performance Plan shall immediately and completely lapse.

(vii) In addition to any benefits continued under the Change-in-Control Retention Agreement, the Company shall continue certain of Executive’s benefits under this Agreement for a period of twenty four (24) months following the Date of Termination (for purposes of this Section 7(c)(vi), the “CIC Continued Benefits”). The CIC Continued Benefits shall include health care benefits, dental benefits, prescription drug benefits, vision care benefits, life insurance benefits, disability benefits, and tax and financial planning assistance benefits otherwise described under this Agreement. Any rights that Executive and/or his qualified beneficiaries may have to continuation of health plan coverage in accordance with the requirements of applicable law (e.g. “COBRA coverage” under the Employee Retirement Income Security Act of 1974) shall run concurrently with the continuation of welfare benefits under this Section 7(c)(vi), such that Executive will timely elect such continuation coverage and the Company shall be responsible for necessary premium payments on behalf of Executive. The Company may require Executive to complete and file any election forms that are generally required of other employees to obtain COBRA coverage; and Executive’s COBRA coverage may be terminable in accordance with applicable law.

(d) Termination Due to Death. Subject to Section 7(g) and (h) and the restrictions contained herein, in the event of Executive’s Termination due to Death, the Company shall pay to Executive the amounts described in Section 7(a). The Company also shall do all of the following:

(i) Executive’s surviving spouse shall receive a life insurance benefit payout equivalent to two times Executive’s Annual Base Salary and target Bonus for the fiscal year in which death occurs.

(ii) Executive’s surviving spouse shall be entitled to continued health care benefits for a period of two (2) years following the date of Executive’s death, or such longer amount as may be provided under the Company’s benefit plans from time to time.

(iii) The Company shall pay to Executive’s estate, in a single cash payment, a prorated amount of the Bonus payable under Section 5(b) for such fiscal year based upon actual performance in such fiscal year, as determined at the end of the applicable performance period. Such payment shall be made in a lump sum by the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.” For this purpose, the term “substantial risk of forfeiture” shall be determined within the meaning of Treasury Regulations Section 1.409A-1(b)(4) and (d).

(iv) The Company shall settle on a prorata basis any awards granted Executive under the Long-Term Performance Plan for any performance period(s) not completed on the Date of Termination based upon actual performance in each such applicable performance period, as determined at the end of the applicable performance period. Such settlement shall be made in a lump sum after the end of the applicable performance period with respect to which it is to be calculated, and after the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.”

(v) Executive (and thus, his surviving spouse) shall immediately become fully vested in his benefits under the Supplemental Individual Pension Benefit.

(vi) All restrictions upon any Common Stock granted to Executive under the Long-Term Performance Plan shall immediately lapse on a prorata basis.

(vii) Executive’s estate shall retain the right to exercise vested Options granted under the Long-Term Performance Plan for the remainder of their term.

(e) Termination Due to Disability. Subject to Section 7(g) and (h) and the restrictions contained herein, in the event of Executive’s Termination due to Disability, the Company shall pay to Executive the amounts described in Section 7(a). The Company also shall do all of the following:

(i) Executive shall receive disability benefits, if any, in accordance with the Nordson Corporation Long Term Disability Plan, and be entitled to a maximum of $25,000 per calendar month during the period of such Disability payable through a combination of income replacement benefits afforded under the Long Term Disability Plan and the Company’s supplemental long term disability plan for executive officers.

(ii) The Company shall pay to Executive, in a single cash payment, a prorated amount of the Bonus payable under Section 5(b) for such fiscal year based upon actual performance in such fiscal year, as determined at the end of the applicable performance period. Such payment shall be made in a lump sum by the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.” For this purpose, the term “substantial risk of forfeiture” shall be determined within the meaning of Treasury Regulations Section 1.409A-1(b)(4) and (d).

(iii) The Company shall settle on a prorata basis any awards granted Executive under the Long-Term Performance Plan for any performance period(s) not completed on the Date of Termination based upon actual performance in each such applicable performance period, as determined at the end of the applicable performance period. Such settlement shall be made in a lump sum after the end of the applicable performance period with respect to which it is to be calculated, and after the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.”

(iv) Executive shall immediately become fully vested in his benefits under the Supplemental Individual Pension Benefit.

(v) All restrictions upon any Common Stock granted to Executive under the Long-Term Performance Plan shall immediately lapse on a prorata basis.

(vi) Executive shall retain the right to exercise vested Options granted under the Long-Term Performance Plan for the remainder of their term.

(vii) If Executive is age 65 or older at the Date of Termination, Executive shall receive a $12,000 Company-paid retiree life insurance benefit, or such other life insurance benefit as may be provided under the Company’s retiree benefit programs from time to time. If Executive has not yet attained age 65 at the Date of Termination, Executive shall receive continuation of Company-paid life insurance benefits until age 65 (assuming that waiver of premium is approved).

(f) Termination Due to Retirement. Subject to Section 7(g) and (h) and the restrictions contained herein, in the event of Executive’s Termination due to Retirement, the Company shall pay to Executive the amounts described in Section 7(a), but Executive shall not be entitled to any severance, salary continuation or other termination pay. However, the Company also shall do all of the following:

(i) The Company shall pay to Executive, in a single cash payment, a prorated amount of the Bonus payable under Section 5(b) for such fiscal year based upon actual performance in such fiscal year, as determined at the end of the applicable performance period. Such payment shall be made in a lump sum by the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.” For this purpose, the term “substantial risk of forfeiture” shall be determined within the meaning of Treasury Regulations Section 1.409A-1(b)(4) and (d).

(ii) The Company shall settle on a prorata basis any awards granted Executive under the Long-Term Performance Plan for any performance period(s) not completed on the Date of Termination based upon actual performance in each such applicable performance period, as determined at the end of the applicable performance period. Such settlement shall be made in a lump sum after the end of the applicable performance period with respect to which it is to be calculated, and after the later of (a) 2-1/2 months after the end of the calendar year in which the amount to be paid is no longer subject to a “substantial risk of forfeiture,” or (b) 2-1/2 months after the taxable year of the Company in which the amount to be paid is no longer subject to a “substantial risk of forfeiture.”

(iii) The Company shall permit Executive to exercise all vested but unexercised Options in accordance with the terms of the applicable Notice of Award.

(iv) All restrictions upon any Common Stock granted to Executive under the Long-Term Performance Plan shall immediately and completely lapse.

(v) Executive shall receive a $12,000 Company-paid retiree life insurance benefit, or such other life insurance benefit as may be provided under the Company’s retiree benefit programs from time to time.

(g) Benefits Provided Upon Termination of Employment. If Executive’s termination or resignation does not constitute a “separation from service,” as such term is defined under Code Section 409A, Executive shall nevertheless be entitled to receive all of the payments and benefits that Executive is entitled to receive under this Section 7 on account of his termination of employment. However, the payments and benefits that Executive is entitled to under this Agreement shall not be provided to Executive until such time as Executive has incurred a “separation from service” within the meaning of Code Section 409A. Unless otherwise indicated under this Section 7 and/or any applicable Notice of Award or benefit plan, any payments to which Executive is entitled under this Section 7 shall be made within sixty (60) days following Executive’s separation from service.

(h) Specified Employee Status Under Section 409A. Furthermore, notwithstanding any provision of this Agreement to the contrary, if Executive is a “specified employee” (as defined by Code Section 409A) at the time of his termination of employment under this Agreement (or, if later, his “separation from service” under Code Section 409A), to the extent that a payment, reimbursement or benefit under Section 7 is considered to provide for a “deferral of compensation” (as determined under Code Section 409A), then such payment, reimbursement or benefit shall not be paid or provided until six months after Executive’s separation from service, or his death, whichever occurs first. Any compensation, reimbursements or benefits that are withheld under this provision for the first six months shall be payable in a lump sum on the 181st day after such termination of employment (or, if later, separation from service).

The restrictions in this Section 7(h) shall be interpreted and applied solely to the minimum extent necessary to comply with the requirements of Code Section 409A(a)(2)(B). Accordingly, payments, benefits or reimbursements under Section 7 or any other part of this Agreement may nevertheless be provided to Executive within the six (6) month period following the date of Executive’s termination of employment under this Agreement (or, if later, his “separation from service” under Code Section 409A), to the extent that it would nevertheless be permissible to do so under Code Section 409A because those payments, reimbursements or benefits are (i) described in Treasury Regulations Section 1.409A-1(b)(9)(iii) (i.e., payments within the limitations therein that are being made on account of an involuntary termination or termination for good reason, within the meaning of the Treasury Regulations), or (ii) benefits described in Treasury Regulations Section 1.409A-1(b)(9)(v) (e.g., health care benefits).

(iNonduplication of Benefits. To the extent, and only to the extent, a payment or benefit that is paid or provided under this Section 7 would also be paid or provided under the terms of the applicable plan, program, agreement or arrangement, including, without limitation, the Change-in-Control Retention Agreement described in Section 4(e), such applicable plan, program, agreement or arrangement will be deemed to have been satisfied by the payment made or benefit provided under this Agreement.

8. Non-competition; Confidential Information. Executive will be a party to and abide by the terms of the standard Nordson Employee Agreement regarding confidentiality, non-competition, trade secret protection and patent assignment. Breach of the Nordson Employee Agreement by Executive shall constitute a material breach of this Agreement. In exchange for post-termination benefits afforded Executive under Section 7 of this Agreement, Executive agrees that the Company shall not be obligated to make payments to Executive under Section 8 (non-competition) of the Nordson Employee Agreement .

9. Injunctive Relief. It is recognized and acknowledged by Executive that a breach of the covenants described in Section 8 above will cause irreparable damage to the Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate.  Accordingly, Executive agrees that in the event of a breach of any of the covenants contained in Section 8 above, in addition to any other remedy which may be available at law or in equity, the Company shall be entitled to specific performance and injunctive relief.  

10. Survival. The expiration or termination of the Term shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration.  

11. Binding on Successors. This Agreement shall be binding upon and inure to the benefit of the Company, Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.  

12. Governing Law. This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of Ohio.  

13. Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

14. Notices. Any notice, request, claim, demand, document or other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:  

(a) If to the Company, to:  

Nordson Corporation 
28601 Clemens Road 
Cleveland, Ohio 44145-1119 
Attention:  Vice President and General Counsel  

with copies to:  

Nordson Corporation 
28601 Clemens Road 
Cleveland, Ohio 44145-1119 
Attention: Chair, Compensation Committee    

(b) If to Executive, to him at the address set forth below under his signature

with a copy to:

Mr. George C. Hlavac, Esq. 
Tallman Hudders & Sorrentino 
1611 Pond Road 
Suite 300 
Allentown, PA  18104  

or at any other address as any party shall have specified by notice in writing to the other party in accordance with this Section 14.  

15. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same agreement.  

16. Entire Agreement. The terms of this Agreement, together with the Management Incentive Plan, the Long-Term Performance Plan and any Award Agreement(s) issued thereunder, are intended by the parties to be the final expression of their agreement with respect to the employment of Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement.  The parties further intend that this Agreement, and the aforementioned contemporaneous documents, shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.   

17. Amendments; Waivers. This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by Executive and authorized on behalf of the Company by the Compensation Committee.  By an instrument in writing similarly executed, Executive or the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform; providedhowever, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure.  No failure to exercise and no delay in exercising any right, remedy or power hereunder shall preclude any other or further exercise of any other right, remedy or power provided herein or by law or in equity.  

18. No Inconsistent Actions. The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement.  Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.  

19. Arbitration. Any dispute or controversy arising under or in connection with this Agreement or Executive’s employment with the Company, to include without limitation, any employment-related claim regarding Executive’s hiring, terms and conditions of employment, and termination of employment sounding in contract or tort or under federal, state or local statute or other law (to exclude claims for workers’ compensation, unemployment compensation and under the Employee Retirement Income Security Act of 1974 (“ERISA”)) shall be settled exclusively by arbitration, conducted before a panel of three arbitrators in Cleveland, Ohio, in accordance with the Employment Arbitration Rules of the American Arbitration Association then in effect.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction; providedhowever, that the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Section 8 or 9 of this Agreement and Executive hereby consents that such restraining order or injunction may be granted without the necessity of the Company’s posting any bond; and providedfurther, that Executive shall be entitled to seek specific performance of his right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.  Each of the parties hereto shall bear its share of the fees and expenses of any arbitration hereunder.

20. Indemnification and Insurance. The Company shall indemnify Executive to the fullest extent permitted by the laws of the State of Ohio, in effect at the time of the subject act or omission, and shall advance to Executive reasonable attorneys’ fees and expenses as such fees and expenses are incurred (subject to an undertaking from Executive to repay such advances if it shall be finally determined by a judicial decision which is not subject to further appeal that Executive was not entitled to the reimbursement of such fees and expenses) and he shall be entitled to the protection of any insurance policies the Company shall elect to maintain generally for the benefit of its directors and officers (“Directors and Officers Insurance”) against all costs, charges and expenses incurred or sustained by him in connection with any action, suit or proceeding to which he may be made a party by reason of his being or having been a director, officer or employee of the Company or any of its subsidiaries or his serving or having served any other enterprise as a director, officer or employee at the request of the Company (other than any dispute, claim or controversy arising under or relating to this Agreement).  The Company covenants to maintain during the Term and for a reasonable period of time thereafter (which period shall not be less than five years) for the benefit of Executive (in his capacity as a current or former officer and director of the Company, as applicable) Directors and Officers Insurance providing customary benefits to Executive with respect to all periods during the Term.

21. Withholding of Taxes. All payments under this Agreement shall be subject to withholding, deductions and contributions as required by law.

221. Code Section 409A Compliance. This Agreement is intended to comply with the requirements of Code Section 409A or an exemption or exclusion therefrom and, with respect to amounts that are subject to Code Section 409A, shall in all respects be administered in accordance with Code Section 409A. Each payment under this Agreement shall be treated as a separate payment for purposes of Code Section 409A. In no event may Executive, directly or indirectly, designate the calendar year of any payment to be made under this Agreement. If Executive dies following the date of termination and prior to the payment of any amounts delayed on account of Code Section 409A, such amounts shall be paid to the personal representative of Executive’s estate within 30 days after the date of Executive’s death. All reimbursements and in-kind benefits provided under this Agreement that constitute deferred compensation within the meaning of Code Section 409A shall be made or provided in accordance with the requirements of Code Section 409A, including, without limitation, that (i) in no event shall reimbursements by the Company under this Agreement be made later than the end of the calendar year next following the calendar year in which the applicable fees and expenses were incurred, provided, that Executive shall have submitted an invoice for such fees and expenses at least 10 days before the end of the calendar year next following the calendar year in which such fees and expenses were incurred; (ii) the amount of in-kind benefits that the Company is obligated to pay or provide in any given calendar year shall not affect the in-kind benefits that the Company is obligated to pay or provide in any other calendar year; (iii) Executive’s right to have the Company pay or provide such reimbursements and in-kind benefits may not be liquidated or exchanged for any other benefit; and (iv) in no event shall the Company’s obligations to make such reimbursements or to provide such in-kind benefits apply later than Executive’s remaining lifetime (or if longer, through the 20th anniversary of Effective Date). The Company may, in consultation with Executive, modify this Agreement, in the least restrictive manner necessary and without any diminution in the value of the payments to Executive, in order to cause the provisions of the Agreement to comply with the requirements of Code Section 409A, so as to avoid the imposition of taxes and penalties on Executive pursuant to Code Section 409A.

IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year first above written.   

 

 

 

 

 

 

 

NORDSON CORPORATION

 

 

 

 

 

By:

 

 

 

Name:

 

Robert E. Veillette

 

 

Title:

 

Vice President, General Counsel and Secretary

 

 

 

 

 

 

 

 

EXECUTIVE

 

 

 

 

 

 

Address: 2215 Augusta Drive

 

 

Center Valley, PA 18034

 

 

 

 

 

 

EX-99.4 5 exhibit4.htm EX-99.4

Exhibit 99.4

CHANGE-IN-CONTROL RETENTION AGREEMENT

This Agreement is entered into as of [insert effective date] by and between The Nordson Corporation, an Ohio corporation (“Nordson”), and [Name of Executive], an individual (“Employee”).

Employee is an executive and key employee of Nordson and is now serving Nordson as its [Executive’s Title]. Nordson desires to assure itself of continuity of management in the event of any threatened or actual Change in Control, to provide inducements for Employee not to compete with Nordson, and to assure itself, in the event of any threatened or actual Change in Control, of the continued performance of services by Employee on an objective and impartial basis and without distraction by concern for [his/her] employment status and security. In order to induce Employee to remain in its employ, Nordson agrees that if Employee’s employment with Nordson is terminated after a Change in Control under certain circumstances as described below, Nordson will pay the severance benefits set forth in this Agreement.

Nordson and Employee agree as follows:

1. Operation of Agreement. This Agreement will be effective and binding immediately upon the date first set forth above (the “Effective Date”) but will not be operative unless and until there has been a Change in Control while Employee is in the employ of Nordson. If a Change in Control occurs while Employee is in the employ of Nordson, this Agreement will become immediately operative and (subject only to the possible undoing of the particular Change in Control, as provided in Section 14 below) will continue in effect in accordance with its terms.

2. Retention Period. If and when a Change in Control occurs, Nordson will continue to employ Employee and Employee will continue in the employ of Nordson during the period (the “Retention Period”) that begins on the first date on which a Change in Control occurs (the “Change in Control Date”) and ends at the close of business on the second anniversary of the Change in Control Date, except that Employee’s employment may be terminated during the Retention Period as provided in Section 5 below.

3. Position, Duties, Responsibilities. At all times during the Retention Period, Employee will:

(a) hold the same position with substantially the same duties and responsibilities as an executive of Nordson as Employee held immediately before the Change in Control, as those duties and responsibilities may be extended from time to time during the Retention Period by Nordson’s Board of Directors (the “Board”);

(b) observe all Nordson policies applicable to Nordson executive personnel; and

(c) devote [his/her] business time, energy, and talent to the business of and to the furtherance of the purposes and objectives of Nordson to generally the same extent as Employee so devoted [his/her] business time, energy, and talent before the Change in Control.

Nothing in this Agreement will preclude Employee from devoting reasonable periods of time to charitable and community activities or the management of Employee’s investment assets provided those activities do not materially interfere with the performance of Employee’s duties under this Agreement.

4. Compensation and Benefits During the Retention Period. During the Retention Period, Employee will be entitled to the same base salary and to the same or equivalent other elements of total direct compensation opportunity (consisting of, short and long term incentive compensation, equity grants, and executive perquisites) and employee pension and welfare benefits as that afforded to Employee by Nordson immediately before the Change in Control Date.

5. Termination Following a Change in Control. During the Retention Period, Employee’s employment with Nordson (and the Retention Period) may be terminated only in accordance with one of the subsections of this Section 5. For all purposes of this Agreement, the term “Employment Termination Date” means the last date on which Employee is employed by Nordson.

(a) By Nordson for Cause. Nordson may terminate Employee’s employment under this Agreement for “Cause,” effective immediately upon giving notice of termination, if:

(i) Employee commits an act of fraud, embezzlement, theft, or other similar criminal act constituting a felony and involving Nordson’s business, or

(ii) Employee (except by reason of incurring a disability) breaches [his/her] agreement with respect to the time to be devoted to the business of Nordson set forth in Section 3(c) above and fails to cure that breach within 30 days of receipt of written notice of that breach from the Board.

(b) By Nordson without Cause. Nordson may terminate Employee’s employment under this Agreement without Cause at any time, effective immediately upon giving notice of that termination.

(c) By Employee for Good Reason. Subject to compliance with the notice and opportunity for cure requirements set forth at the end of this Section 5(c), Employee may terminate [his/her] employment under this Agreement for “Good Reason” if any of the following circumstances occurs during the Retention Period without Employee’s express written consent:

(i) a reduction in Employee’s base annual salary from that provided immediately before the Change in Control Date; 

(ii) a failure by Nordson to make available to Employee compensation plans, employee pension plans, and employee welfare benefit plans (collectively, “Plans”) and other benefits and perquisites that provide opportunities to receive overall compensation and benefits and perquisites at least equal to the opportunities for overall compensation and benefits and perquisites that were available to Employee immediately before the Change in Control Date;

(iii) a change in the location of Employee’s principal place of employment by more than 50 miles from the location where Employee was principally employed immediately before the Change in Control Date;  

(iv) a significant increase in the frequency or duration of Employee’s business travel; or 

(v) a material and adverse change in the authorities, powers, functions, or duties attached to Employee’s position from those authorities, powers, functions, and duties as they existed immediately before the Change in Control Date (but a change in the office or officer to whom Employee reports will not, in itself, be deemed to be a material adverse change in Employee’s authorities, powers, functions, or duties for these purposes).

Employee may give notice of termination for Good Reason based on any particular circumstance described in any of (i) through (v) of this Section 5(c) only if Employee gives notice of that intention (and of the particular circumstance on which the notice is based) not later than 90 days after Employee becomes aware of the existence of that particular circumstance. Any notice by Employee of termination for Good Reason must specify a date, not earlier than 30 days after the date on which the notice is given, that Employee proposes as [his/her] Employment Termination Date. If Nordson cures the circumstance identified by Employee in [his/her] notice before the proposed Employment Termination Date, Employee will not be entitled to terminate for Good Reason based upon the cured circumstance and Employee’s notice will be deemed rescinded. If Nordson fails to so cure before the proposed Employment Termination Date, Employee’s employment will terminate for Good Reason effective on that date.

(d) By Employee without Good Reason. Employee may terminate [his/her] employment under this Agreement without Good Reason at any time, effective immediately upon giving of notice of that termination.

(e) Upon Death or Retirement. Upon the death or Retirement of Employee, Employee’s employment under this Agreement will terminate automatically and without further notice, effective as of the date of death or Retirement. For all purposes of this Agreement, “Retirement” means Employee’s termination of employment under the terms of the applicable Nordson retirement plan as in effect immediately before the Change in Control Date.

(f) Upon Total Disability. Nordson may terminate Employee’s employment under this Agreement, effective thirty days after the giving of notice by Nordson, if Employee suffers a Total Disability. For all purposes of this Agreement, “Total Disability” means a physical or mental impairment, due to accident or illness, that renders Employee permanently incapable of performing the duties attached to Employee’s position as those duties existed immediately before the Change in Control Date.

6. Payments upon Termination.

(a) Termination for Cause or without Good Reason. If during the Retention Period Nordson terminates Employee’s employment for Cause or Employee terminates [his/her] employment without Good Reason, Employee will not be entitled to any termination, separation, severance, or similar benefits under this Agreement.

(b) Termination Upon Employee’s Total Disability, Retirement, or Death. If during the Retention Period Employee’s employment is terminated as a result of Employee’s Total Disability, Retirement, or death, Employee will be entitled to benefits under and in accordance with Nordson’s disability, retirement, and death benefit (including life insurance policies) plans and policies as in effect immediately before the Change in Control Date, or benefits equivalent thereto. In addition, Nordson will pay to Employee (or to Employee’s estate in the event of Employee’s death) any Unpaid Prior Year Bonus and a Current Year Pro Rata Bonus. For all purposes of this Agreement, the term “Unpaid Prior Year Bonus” means any bonus for the fiscal year ended immediately before the fiscal year in which the Employment Termination Date occurs that remains unpaid as of the Employment Termination Date (whether or not, under normal practice, that bonus would not be paid until a date later than the Employment Termination Date).

For all purposes of this Agreement, the term “Current Year Pro Rata Bonus” means (x) an amount calculated on the same date and in the same manner as Employee’s annual incentive bonus under the bonus plan in effect for the fiscal year in which the Employment Termination Date occurs would have been calculated if Employee’s employment had not been terminated and, to the extent relevant to that calculation, Employee’s performance through the entire fiscal year had been equal to [his/her] performance during the part of the fiscal year ending on the Employment Termination Date, multiplied by (y) a fraction, the numerator of which is the number of days in the partial fiscal year ending on the Employment Termination Date and the denominator of which is 365. Unless any payment under this Section 6(b) must be postponed by reason of Section 409A of the Internal Revenue Code (as provided in Exhibit A to this Agreement): Nordson will pay any Unpaid Prior Year Bonus at the same time that amount would have been paid if Employee’s employment had continued indefinitely but not later than March 15 of the year in which the Employment Termination Date occurs; Nordson will pay any Current Year Pro Rata Bonus at the same time that amount would have been paid if Employee’s employment had continued indefinitely but not later than March 15 of the year immediately after the year in which the Employment Termination Date occurs; and Nordson will pay any other benefits or amounts payable pursuant to this Section 6(b) at the time specified in the applicable plan.

(c) Termination without Cause or for Good Reason. If during the Retention Period Employee’s employment is terminated by Nordson without Cause or by Employee for Good Reason, Nordson will pay and provide to Employee the following compensation and benefits:

(i) Accrued Obligations. Nordson will pay to Employee base salary through the Employment Termination Date (at the rate in effect immediately before the Employment Termination Date), any Unpaid Prior Year Bonus, a Pro Rata Current Year Bonus, and all other amounts to which Employee is entitled under any Nordson compensation plan applicable to Employee that is listed on Exhibit B to this Agreement. Unless any payment under this Section 6(c)(i) must be postponed by reason of Section 409A of the Internal Revenue Code (as provided in Exhibit A to this Agreement), Nordson will pay any base salary within five business days of the Employment Termination Date; Nordson will pay any Unpaid Prior Year Bonus at the same time that amount would have been paid if Employee’s employment had continued indefinitely but not later than March 15 of the year in which the Employment Termination Date occurs; Nordson will pay any Current Year Pro Rata Bonus at the same time that amount would have been paid if Employee’s employment had continued indefinitely but not later than March 15 of the year immediately after the year in which the Employment Termination Date occurs; and Nordson will pay any other amounts payable pursuant to this Section 6(c)(i) at the time specified in the applicable compensation plan.

(ii) Severance Payment. Nordson will pay to Employee a severance payment equal to two times the sum of (x) Employee’s annual base salary (at the rate in effect immediately before the Employment Termination Date) plus (y) Employee’s annual target incentive bonus in effect on the Employment Termination Date. Unless this payment must be postponed by reason of Section 409A of the Internal Revenue Code (as provided in Exhibit A to this Agreement), Nordson will pay this amount to Employee within five business days of the Termination Date.

(iii) Continuing Plan Coverage. For a period of two years following the Employment Termination Date, Nordson will maintain in full force and continue to provide full benefits to Employee under all life insurance, health (medical and dental), accidental death and dismemberment, pension, and disability plans and programs in which Employee was entitled to participate immediately before the Employment Termination Date, except that (x) if Employee’s continued participation is not possible under the general terms and provisions of any such plan or program, Nordson will provide Employee with benefits equivalent to those provided by each such plan and program, and (y) Nordson will not be required to maintain any of these plans and programs, or the equivalent thereof, after Employee has either reached the normal retirement date under the retirement or pension plan in effect immediately before the Change in Control Date or secured full time employment with another employer that provides benefits to Employee under a comparable plan or program that are at least substantially equal to the benefits provided by Nordson. To assure compliance with Section 409A of the Internal Revenue Code, the timing of the provision of any benefits under this Section 6(c)(iii) will be subject to Section B of Exhibit A to this Agreement if and to the extent any part of that section is applicable according to its terms.

(iv) Lump Sum Payment Based on Additional Two Years of Age and Service under Pension and Excess Defined Benefit Plans. Nordson will pay to Employee a lump sum amount equal to the amount by which the aggregate actuarial present value, calculated as of the Employment Termination Date, of all amounts payable with respect to Employee under the Nordson Corporation Salaried Employees Pension Plan, the Nordson Corporation Amended and Restated 2005 Excess Defined Benefit Pension Plan, and the Nordson Corporation Amended and Restated 2005 Excess Defined Benefit Pension Plan (or equivalent plans) would be increased if Employee had an additional two years of age and an additional two years of service credit under each of these plans. Unless this payment must be postponed by reason of Section 409A of the Internal Revenue Code (as provided in Exhibit A to this Agreement), Nordson will pay this amount to Employee within five business days of the Employment Termination Date.

(v) Career Counseling. Nordson will make available to Employee, at Nordson’s expense, outplacement counseling services. Employee may select the organization that will provide Employee with such services, provided that Nordson will not be required to pay more than $50,000 for any such services. To assure compliance with Section 409A of the Internal Revenue Code, the timing of the provision of any benefits under this Section6(c)(v) will be subject to Section B of Exhibit A to this Agreement if and to the extent any part of that section is applicable according to its terms.

7. No Set-Off; No Obligation to Seek Other Employment or to Otherwise Mitigate Damages; No Effect Upon Other Agreements. Nordson’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations under this Agreement will not be affected by any set-off, counterclaim, recoupment, defense, or other claim whatsoever that Nordson may have against Employee. Employee will not be required to mitigate damages or the amount of any payment provided for under this Agreement by seeking other employment or otherwise. Except as expressly provided in Section 6(c)(iii) as to continuing coverage of benefit plans, the amount of any payment or benefits provided for under this Agreement will not be reduced by any compensation or benefits earned by Employee as the result of employment by another employer or otherwise after the Employee’s termination date. Except as provided in Section Error! Reference source not found., the provisions of this Agreement will not affect the validity or enforceability of any other agreement between Nordson and Employee, and the benefits provided under this Agreement will be additive to any other benefits promised to Employee under any such other agreement. Moreover, this Agreement will not operate to negate any other assurances provided to Employee.

8. Effect of Disability. If Employee becomes disabled and [his/her] disability does not rise to the level of a Total Disability during the Retention Period to such an extent that [he/she] is permanently prevented from performing [his/her] duties under this Agreement by reason of physical or mental incapacity:

(a) Employee will be entitled to disability and other benefits at least equal to those that would have been available to [him/her] had Nordson continued, throughout the period of Employee’s disability, all of its programs, benefits, and policies with respect to disabled employees that were in effect immediately before the Change in Control Date, and

(b) if Employee recovers from [his/her] disability before the expiration of the Retention Period, [he/she] will be reinstated as an active employee for the remainder of the Retention Period under and subject to all of the terms of this Agreement including, without limitation, Nordson’s right to terminate Employee with or without Cause under Sections 5(a) and 5(b), respectively.

9. Confidential Information. Employee will not, at any time after the Effective Date, either directly or indirectly, disclose or make known to any person, firm, or corporation any confidential information, trade secret, or proprietary information of Nordson that Employee may have acquired before the Effective Date or may acquire after the Effective Date in the performance of Employee’s duties as an employee of Nordson. Upon the termination of Employee’s employment with Nordson, Employee will deliver forthwith to Nordson any and all literature, documents, correspondence, and other materials and records furnished to or acquired by Employee during the course of [his/her] employment.

10. Noncompetition. During the Retention Period Employee will not act as a proprietor, investor, director, officer, employee, substantial stockholder, consultant, or partner in any business engaged to a material extent in direct competition with Nordson in any market in any line of business engaged in by Nordson during the Retention Period.

11. Costs of Enforcement. Nordson will pay and be solely responsible for any and all costs and expenses (including attorneys’ fees) incurred by Employee in seeking to enforce Nordson’s obligations under this Agreement unless and to the extent a court of competent jurisdiction determines that Nordson was relieved of those obligations because:

(a) Nordson terminated Employee’s employment for Cause,

(b) Employee voluntarily terminated [his/her] employment other than for Good Reason, or

(c) Employee materially and willfully breached [his/her] agreement not to compete with Nordson or [his/her] agreement with respect to confidential information and that breach directly caused substantial and demonstrable damage to Nordson.

Nordson will forthwith pay directly or reimburse Employee for any and all such costs and expenses upon presentation from time to time by Employee or by counsel selected by Employee of a statement or statements prepared by Employee or by that counsel of the amount of such costs and expenses. If and to the extent a court of competent jurisdiction renders a final binding judgment determining that Nordson was relieved of its obligations for any of the reasons set forth in (a), (b) or (c) above, Employee will repay the amount of those payments or reimbursements to Nordson. In addition to the payment and reimbursement of expenses of enforcement provided for in this Section 11, Nordson will pay to Employee in cash, as and when Nordson makes any payment on behalf of, or reimbursement to, Employee, an additional amount sufficient to pay all federal, state, and local taxes (whether income taxes or other taxes) incurred by Employee as a result of (x) payment of the expense or receipt of the reimbursement, and (y) receipt of the additional cash payment. Nordson will also pay to Employee interest (calculated at the Wall Street Journal Prime Rate from time to time in effect, compounded monthly) on any payments or benefits that are paid or provided to Employee later than the date on which due under the terms of this Agreement. To assure compliance with Section 409A, Nordson will make any payments to or on behalf of Employee that are required under this Section 11 subject to and as provided in Section B of Exhibit A to this Agreement.

12. Tax Provisions Regarding Gross-Ups and Compliance with Section 409A a Part of this Agreement. All of the provisions of Exhibit A to this Agreement, captioned “Tax Provision Exhibit – 280G Gross-Up, Compliance with Section 409A, and 409A Gross-Up” will apply as between Nordson and Employee as fully if those provisions had been written directly into the body of this Agreement.

13. “Change in Control” Defined. For purposes of this Agreement, a Change in Control will have occurred if at any time any of the following events occurs:

(a) a report is filed with the Securities and Exchange Commission (the “SEC”) on Schedule 13D or Schedule 14D-1 (or any successor schedule, form, or report), each as promulgated pursuant to the Securities Exchange Act of 1934, disclosing that any “person” (as the term “person” is used in Section 13(d) or Section 14(d)(2) of the Securities Exchange Act of 1934) is or has become a beneficial owner, directly or indirectly, of securities of Nordson representing 25% or more of the combined voting power of Nordson’s then outstanding securities;

(b) Nordson files a report or proxy statement with the SEC pursuant to the Securities Exchange Act of 1934 disclosing that a Change in Control of Nordson has or may have occurred or will or may occur in the future pursuant to any then-existing contract or transaction;

(c) Nordson is merged or consolidated with another corporation and, as a result thereof, securities representing less than 50% of the combined voting power of the surviving or resulting corporation’s securities (or of the securities of a parent corporation in case of a merger in which the surviving or resulting corporation becomes a wholly-owned subsidiary of the parent corporation) are owned in the aggregate by holders of Nordson’s securities immediately before such merger or consolidation;

(d) all or substantially all of the assets of Nordson are sold in a single transaction or a series of related transactions to a single purchaser or a group of affiliated purchasers; or

(e) during any period of 24 consecutive months, individuals who were Directors of Nordson at the beginning of the period cease to constitute at least a majority of the Board unless the election, or nomination for election by Nordson’s shareholders, of more than one half of any new Directors of Nordson was approved by a vote of at least two-thirds of the Directors of Nordson then still in office who were Directors of Nordson at the beginning of the 24 month period.

14. Possible Undoing of a Change in Control and Its Effect on this Agreement. If a Change in Control as defined in Section 13(a) occurs while Employee is in the employ of Nordson with the result (as provided in Section 1) that this Agreement becomes operative and, thereafter, on any later date, all three of the following conditions are satisfied:

(a) the acquiring person has transferred or otherwise disposed of sufficient securities of Nordson in one or more transactions, to a person or persons other than affiliates of the acquiring person or any persons with whom the acquiring person has agreed to act together for the purpose of acquiring, holding, voting, or disposing of securities of Nordson, so that, after the transfer or other disposition, the acquiring person is no longer the beneficial owner, directly or indirectly, of securities of Nordson representing 10% or more of the combined voting power of Nordson’s then outstanding securities;

(b) no other event constituting a Change in Control had occurred; and

(c) Employee’s employment with Nordson has not been terminated by Nordson without Cause or by Employee for Good Reason;

then, for all purposes of this Agreement, the filing of the report constituting a Change in Control under Section 13(a) will be treated as if it had not occurred and this Agreement will return to the status it had immediately before the filing of the report constituting a Change in Control under Section 13(a). Accordingly, if and when a subsequent Change in Control occurs, this Agreement will again become operative on the date of that subsequent Change in Control.

15. Miscellaneous.

(a) Employee Rights. Nothing expressed or implied in this Agreement creates any right or duty on the part of Nordson or Employee to have Employee remain in the employ of Nordson before any Change in Control and Employee will have no rights under this Agreement if [his/her] employment with Nordson is terminated for any reason or for no reason before any Change in Control. Nothing expressed or implied in this Agreement creates any duty on the part of Nordson to continue in effect, or continue to provide to Employee, any plan or benefit unless and until a Change in Control occurs. If, before a Change in Control, Nordson ceases to provide any plan or benefit to Employee, nothing in this Agreement will be construed to require Nordson to reinstitute that plan or benefit to Employee upon the later occurrence of a Change in Control.

(b) Notices. All communications provided for in this Agreement are to be in writing and will be deemed to have been duly given when delivered or when mailed by United States registered or certified mail, return receipt requested, postage prepaid, addressed to Nordson (Attention: Vice President, General Counsel and Secretary) at its principal executive office and to Employee at [his/her] principal residence, or to such other address as either party may have furnished to the other in writing and in accordance with this Section 15(b), except that notices of change of address will be effective only upon receipt.

(c) Assignment, Binding Effect.

(i) This Agreement will be binding upon and will inure to the benefit of Nordson and Nordson’s successors and assigns. Nordson will require any successor (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business and or assets of Nordson, by agreement in form and substance satisfactory to Employee, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Nordson would be required to perform it if no such succession had taken place.

(ii) This Agreement will be binding upon Employee and this Agreement and all rights of Employee under this Agreement will inure to the benefit of, and be enforceable by, Employee and [his/her] personal or legal representatives, executors, or administrators. No right, benefit, or interest of Employee under this Agreement will be subject to assignment, anticipation, alienation, sale, encumbrance, charge, pledge, hypothecation, or to execution, attachment, levy, or similar process; except that Employee may assign any right, benefit, or interest under this Agreement if that assignment is permitted under the terms of any plan or policy of insurance or annuity contract governing the right, benefit, or interest.

(d) Invalid Provisions. Any provision of this Agreement that is prohibited or unenforceable will be ineffective to the extent, but only to the extent, of the prohibition or unenforceability without invalidating the remaining portions of this Agreement and all remaining portions of this Agreement will continue to be in full force and effect. If any provision of this Agreement is determined to be invalid or unenforceable, the parties will negotiate in good faith to replace that provision with another provision that will be valid and enforceable and that is as close as practicable to the provision held invalid or unenforceable.

(e) Modification. No modification, amendment, or waiver of any of the provisions of this Agreement will be effective unless in writing, specifically referring to this agreement, and signed by both parties.

(f) Waiver of Breach. The failure at any time of a party to enforce any of the provisions of this Agreement or to require performance by the other party of any of the provisions of this Agreement will not be construed to be a waiver of those provisions or to affect either the validity of this Agreement or any part of this Agreement or the right of either party thereafter to enforce each and every provision of this Agreement in accordance with its terms.

(g) Governing Law. This Agreement has been made in and is to be governed and construed in accordance with the laws of the State of Ohio applicable to contracts made in and to be performed entirely within that state.

(h) Employment by Subsidiary. If the recitals to this Agreement indicate that as of the Effective Date Employee is employed by a subsidiary of Nordson, all references to continued employment of Employee by Nordson are to be construed as references to continued employment of Employee by the subsidiary and any termination of Employee’s employment with the subsidiary are to be construed as termination of Employee’s employment with Nordson. For the avoidance of doubt, all references to a Change in Control are to changes in control of Nordson, not of the subsidiary and all references to the Board are to the Board of Directors of Nordson, not of the subsidiary.

In witness whereof, Nordson and Employee have executed this Agreement as of the day and year first above written.

 

 

 

Nordson Corporation
By:      

 

Employee
     
[EMPLOYEE’S NAME]

EXHIBIT A:
Tax Provision Exhibit – 280G Gross-Up, Compliance 
with Section 409A, and 409A Gross-Up

A. Gross-Up of Payments Deemed to be Excess Parachute Payments.

A.1 Acknowledgement; Determination by Accounting Firm. Nordson and Employee acknowledge that, following a change in ownership or control (as that term is defined in the Treasury Regulations published under Section 280G of the Internal Revenue Code), one or more payments or distributions to be made by Nordson or an affiliated entity to or for the benefit of Employee (whether paid or payable or distributed or distributable pursuant to the terms of the Agreement to which this Exhibit A is attached, under some other plan, agreement, or arrangement, or otherwise) (a “Payment”) may be determined to be an “excess parachute payment” that is not deductible by Nordson or any affiliated entity for Federal income tax purposes and with respect to which Employee will be subject to an excise tax because of Sections 280G and 4999, respectively, of the Internal Revenue Code. If a change in ownership or control occurs, either Employee or Nordson may direct the Accounting Firm, which, subject to any inconsistent position asserted by the Internal Revenue Service, will make all determinations required to be made under this Section A, to determine whether any Payment will be an excess parachute payment and to communicate its determination, together with detailed supporting calculations, to Nordson and to Employee within 30 days after its receipt of the direction from Employee or Nordson, as the case may be. Nordson and Employee will cooperate with each other and the Accounting Firm and will provide necessary information so that the Accounting Firm may make all such determinations.

A.2 Gross-Up Payments. If the Accounting Firm determines that any Payment gives rise, directly or indirectly, to liability on the part of Employee for excise tax under Section 4999 (and/or any penalties and/or interest with respect to any such excise tax), Nordson will make additional cash payments (each, a “Gross-Up Payment”) to Employee, from time to time in such amounts as are necessary to put Employee in the same position, after payment of all federal, state, and local taxes (whether income taxes, excise taxes under Section 4999 or otherwise, or other taxes) and any and all penalties and interest with respect to any such excise tax, as Employee would have been in after payment of all federal, state, and local income taxes if the Payments had not given rise to an excise tax under Section 4999 and no such penalties or interest had been imposed. Nordson’s obligation to make Gross-Up Payments under this Section A is not contingent on termination of Employee’s employment with Nordson. Nordson will make each Gross-Up Payment to Employee within 30 days of the time that the related Payment constituting an excess parachute payment is paid or provided to Employee.

A.3 Further Gross-Up Payments as Determined by the IRS. If the Internal Revenue Service determines that any Payment gives rise, directly or indirectly, to liability on the part of Employee for excise tax under Section 4999 (and/or any penalties and/or interest with respect to any such excise tax) in excess of the amount, if any, previously determined by the Accounting Firm, Nordson will make further Goss-Up Payments to Employee in cash and in such amounts as are necessary to put Employee in the same position, after payment of all federal, state, and local taxes (whether income taxes, excise taxes under Section 4999 or otherwise, or other taxes) and any and all penalties and interest with respect to any such excise tax, as Employee would have been in after payment of all federal, state, and local income taxes if the Payments had not given rise to an excise tax under Section 4999 and no such penalties or interest had been imposed. Nordson will make any additional Gross-Up Payments required by this Section A.3 not later than the due date of any payment indicated by the Internal Revenue Service with respect to the underlying matters to which the additional Gross-Up Payment relates.

A.4 Contest of IRS Determination by Nordson. If Nordson desires to contest any determination by the Internal Revenue Service with respect to the amount of excise tax under Section 4999, Employee will, upon receipt from Nordson of an unconditional written undertaking to indemnify and hold Employee harmless (on an after tax basis) from any and all adverse consequences that might arise from the contesting of that determination, cooperate with Nordson in that contest at Nordson’s sole expense. Nothing in this Section A will require Employee to incur any expense other than expenses with respect to which Nordson has paid to Employee sufficient sums so that after the payment of the expense by Employee and taking into account the payment by Nordson with respect to that expense and any and all taxes that may be imposed upon Employee as a result of [his/her] receipt of that payment, the net effect is no cost to Employee. Nothing in this Section A will require Employee to extend the statute of limitations with respect to any item or issue in [his/her] tax returns other than, exclusively, the excise tax under Section 4999. If, as the result of the contest of any assertion by the Internal Revenue Service with respect to excise tax under Section 4999, Employee receives a refund of a Section 4999 excise tax previously paid and/or any interest with respect thereto, Employee will promptly pay to Nordson such amount as will leave Employee, net of the repayment and all tax effects, in the same position, after all taxes and interest, that [he/she] would have been in if the refunded excise tax had never been paid. To assure compliance with Section 409A, Nordson will make payments to Employee with respect to expenses as contemplated in this Section A.4 subject to and as provided in Sections B.1 and B.2.

A.5 Accounting Firm Fees and Expenses. Nordson will bear and pay all fees and expenses of the Accounting Firm for services performed pursuant to this Section A that are incurred at any time from the Effective Date through the tenth anniversary of Employee’s death (“Applicable Fees and Expenses”). To assure compliance with Section 409A, Nordson will pay any Applicable Fees and Expenses subject to and as provided in Sections B.1 and B.2.

B. Compliance with Section 409A and 409A Gross Up.

B.1 Six Month Delay on Certain Payments, Benefits, and Reimbursements. If Employee is a “specified employee” for purposes of Section 409A, as determined under Nordson’s policy for determining specified employees on the Employment Termination Date, each payment, benefit, or reimbursement paid or provided under this Agreement that constitutes a “deferral of compensation” within the meaning of Section 409A, that is to be paid or provided as a result of a “separation from service” within the meaning of Section 409A, and that would otherwise be paid or provided at any time (a “Scheduled Time”) that is on or before the date that is exactly six months after the Employment Termination Date (other than payments, benefits, or reimbursements that are treated as separation pay under Section 1.409A-1(b)(9)(v) of the Treasury Regulations) will not be paid or provided at the Scheduled Time but will be accumulated (together with interest at the applicable federal rate under Section 7872(f)(2)(A) of the Code in effect on the Termination Date) through the date that is exactly six months after the Employment Termination Date and will be paid or provided to Employee during the period of 30 consecutive days that starts exactly six months and one day after the Employment Termination Date, except that if Employee dies before the end of six months after the Employment Termination Date, the payments, benefits, or reimbursements will be accumulated only through the date of [his/her] death and will be paid or provided not later than 30 days after the date of death.

B.2 Additional Limitations on Reimbursements and In-Kind Benefits. The reimbursement of expenses or in-kind benefits provided under any section of this Agreement that are taxable benefits (and that are not disability pay or death benefit plans within the meaning of Section 409A of the Code) are intended to comply, to the maximum extent possible, with the exception to Section 409A set forth in Section 1.409A-1(b)(9)(v) of the Treasury Regulations. To the extent that any reimbursement of expenses or in-kind benefits provided under any section of this Agreement either do not qualify for that exception, or are provided beyond the applicable time periods set forth in Section 1.409A-1(b)(9)(v) of the Treasury Regulations, then they will be subject to the following additional rules: (a) any reimbursement of eligible expenses will be paid within 30 days following Employee’s written request for reimbursement; provided that Employee provides written notice no later than 60 days before the last day of the calendar year following the calendar year in which the expense was incurred so that Nordson can make the reimbursement within the time periods required by Section 409A; (b) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during any calendar year will not affect the amount of expenses eligible for reimbursement, or in-kind benefits to be provided, during any other calendar year; and (c) the right to reimbursement or in-kind benefits will not be subject to liquidation or exchange for any other benefit.

B.3 Compliance Generally. Nordson and Employee intend that the payments and benefits provided under the Agreement to which this Exhibit A is attached will either be exempt from the application of, or comply with, the requirements of Section 409A. The Agreement is to be construed, administered, and governed in a manner that effects that intent and Nordson will not take any action that is inconsistent with that intent. Without limiting the foregoing, the payments and benefits provided under this Agreement may not be deferred, accelerated, extended, paid out, or modified in a manner that would result in the imposition of an additional tax under Section 409A upon Employee.

B.4 Section 409A Gross-Up. If, notwithstanding the efforts of the parties to comply with Section 409A, Employee is subject to any excise tax under Section 409A, Nordson will make additional payments (“409A Gross-Up Payments”) to Employee so that after taking into account any such additional tax and any related interest and/or penalties and the 409A Gross-Up Payments, Employee will be in the same position as if no excise tax under Section 409A and no related interest or penalties had been imposed upon [him/her] pursuant to Section 409A. The Accounting Firm will have the same general duties with respect to the determination of the amount of any Section 409A Gross-Up Payments as it has with respect to the determination of Gross-Up Payments with respect to Section 4999 under Section A above and the parties will follow procedures in connection with the determination and payment of any Section 409A Gross-Up Payments that are similar to those specified in Section A above in connection with the determination and payment of any Gross-Up Payments with respect to Section 4999.

B.4 Termination of Employment to Constitute a Separation from Service. The parties intend that the phrase “termination of employment” and words and phrases of similar import mean a “separation from service” with Nordson within the meaning of Section 409A. Employee and Nordson will take all steps necessary (including taking into account this Section B.4 when considering any further agreement regarding provision of services by Employee to Nordson after the Employment Termination Date) to ensure that (a) any termination of employment under this Agreement constitutes a “separation from service” within the meaning of Section 409A, and (b) the Employment Termination Date is the date on which Employee experiences a “separation from service” within the meaning of Section 409A.

C. Definitions.

C.1 Accounting Firm.  The term “Accounting Firm” means the independent auditors of Nordson for the fiscal year immediately preceding the earlier of (a) the year in which the Termination Date occurred, or (b) the year, if any, in which occurred the first Change of Control occurring after the Effective Date, and that firm’s successor or successors; unless that firm is unable or unwilling to serve and perform in the capacity contemplated by this Agreement, in which case Nordson must select another accounting firm that (i) is of recognized regional or national standing and (ii) is not then the independent auditors for Nordson or any affiliated corporation.

C.2 Sections 280G, 409A, and 4999. Each of the terms “Section 280G,” “Section 409A,” and
“Section 4999,” respectively, means that numbered section of the Internal Revenue Code. References
in the Agreement to any of these sections are intended to include any proposed, temporary, or final
regulations, or any other guidance, promulgated with respect to that specific section by the U.S.
Department of Treasury or the Internal Revenue Service.EXHIBIT B:
Compensation and Employment Benefit Plans

 

1.

 

The Amended and Restated Nordson Corporation 2004 Management Incentive Compensation Plan

 

 

2.

 

The Amended and Restated Nordson Corporation 2004 Long-Term Performance Plan

 

 

3.

 

The Nordson Corporation Salaried Employees Pension Plan

 

 

4.

 

The Nordson Corporation Deferred Compensation Plan

 

 

5.

 

The 2005 Nordson Corporation Deferred Compensation Plan

 

 

6.

 

The Amended and Restated Nordson Corporation 2005 Deferred Compensation Plan

 

 

7.

 

The Nordson Corporation Excess Defined Contribution Benefit Plan

 

 

8.

 

The 2005 Nordson Corporation Excess Defined Contribution Benefit Plan

 

 

9.

 

The Amended and Restated 2005 Supplemental Executive Retirement Plan (Defined Contribution)

10. The Nordson Corporation Excess Defined Benefit Pension Plan

 

11.

 

The 2005 Nordson Corporation Excess Defined Benefit Pension Plan

 

 

12.

 

The Amended and Restated 2005 Supplemental Executive Retirement Plan (Defined Benefit)

11. The Nordson Corporation Employees’ Savings Trust Plan (NEST)

 

12.

 

The Nordson Corporation Salaried Employees’ Health Care Plan

 

 

13.

 

The Nordson Corporation Prescription Drug and Dental Plans

 

 

14.

 

The Nordson Corporation Short Term and Long Term Disability Plans

 

 

15.

 

The Nordson Corporation Group Life Insurance Plan-Salaried

 

 

16.

 

The Nordson Corporation Group Travel Accident Plan

 

 

17.

 

Nordson Corporation’s Car Allowance Plan

 

 

18.

 

Nordson Corporation’s policy of reimbursement for club dues, airline travel clubs, and the like

 

 

19.

 

Nordson Corporation’s policies regarding vacation, holidays, and paid time off.