Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made and entered into as of the 11^th day of October, 2019, by and between LYDALL, INC., a Delaware corporation (the “Company”), and Sara A. Greenstein (the “Executive”).

W I T N E S S E T H

WHEREAS, the Company and the Executive (the “Parties”) have agreed to enter into this agreement (the “Agreement”) relating to the employment of the Executive by the Company and/or one of its subsidiaries;

NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and for other good and valuable consideration, the Parties, intending to be legally bound, agree as follows:

1.                Term of Employment.

1.1              The Company (and/or one of its subsidiaries for payroll and benefits purposes) agrees to employ the Executive, and the Executive accepts such employment, commencing on November 18, 2019 (the “Effective Date”), in accordance with the terms and provisions of this Agreement.

1.2              The term of this Agreement and the “Employment Period” under this Agreement shall be the period commencing on the Effective Date and, ending on the date of termination of the Executive’s employment pursuant to Section 5, 6 or 7 below, whichever is applicable.

2.                Duties. During the Employment Period, the Executive will serve as President and Chief Executive Officer of the Company, reporting to the Board of Directors of the Company (the “Board”). In such capacity, the Executive will devote her full business time and attention and best efforts to the affairs of the Company and its subsidiaries and her duties. The Executive will have such duties as are appropriate to her position, and will have such authority as required to enable the Executive to perform these duties. Consistent with the foregoing, the Executive shall comply with all reasonable instructions of the Board or a committee thereof. Subject to and in accordance with the Company charter or by-laws, the Executive shall be appointed a member of the Board effective as soon as practical following the Effective Date (with the Board using all reasonable efforts to effect such appointment within five (5) business days following the Effective Date) and shall thereafter be nominated by the Board to serve as a director for each succeeding director term of service during the Employment Period.

3.                  Compensation and Benefits.

3.1              Base Salary. During the Employment Period, the Company will pay the Executive a base salary at an initial annual rate of Seven Hundred Fifty Thousand Dollars ($750,000). The Company may, in its sole and absolute discretion, increase the Executive’s base salary in light of the Executive’s performance, inflation, changes in the cost of living and other factors deemed relevant by the Company (which increased amount shall thereafter be the Executive’s “base salary” for all purposes under this Agreement). The Executive’s base salary may not be decreased during the Employment Period, other than in connection with an across-the-board decrease affecting all members of senior management of the Company on substantially the same proportional basis. The Chairman of the Board (or a designee) shall meet with the Executive annually to review the Executive’s performance, objectives and compensation, including salary and bonus compensation. The Executive’s base salary will be paid in accordance with the standard practices for other members of senior management of the Company.

3.2              Bonuses; Inducement Equity Grants.

(a)              Annual Bonus. The Executive will be eligible to participate in the Company’s Annual Incentive Performance (“AIP”) program on a full-year basis beginning in fiscal year 2020, at an on-going target bonus opportunity level of not less than one hundred percent (100%) of base salary and a maximum bonus of not less than two hundred percent (200%) of base salary, in accordance with the AIP plan provisions. For fiscal year 2020 only, the Executive is guaranteed a bonus payout under the AIP program of not less than eighty-five percent (85%) of base salary.

(b)             Signing Bonus. In consideration of Executive’s execution and delivery of this Agreement and her commencement of employment with the Company, the Company will pay to Executive a one-time lump sum cash payment in the gross amount of $1,330,000, less required and authorized deductions and withholdings (the “Signing Bonus”), which shall be payable in two equal installments, respectively (i) within thirty (30) days following the Effective Date and (ii) during January 2020. If Executive’s employment ends prior to the first anniversary of the Effective Date due to termination by the Company for Cause (as defined below) or resignation by Executive other than for either Good Reason (as defined below), the Company shall not pay to the Executive any remaining balance of the Signing Bonus after the termination date, if applicable, and the Executive will repay to the Company the full amount of the Signing Bonus paid to her as of the termination date. Similarly, if the Executive’s employment ends prior to the payment of the Signing Bonus due to termination by the Company other than for Cause or resignation by Executive for Good Reason, the Company will make payment to the Executive of the full amount of the Signing Bonus, to the extent then unpaid, in accordance with the timing set forth in this Section 3.2(b)(i) and (ii).

(c)            Equity Awards. Pursuant to separate agreements, as an inducement material to the Executive to accept Employment with the Company, the Company will grant to Executive the following equity awards:

(i)            A long-term incentive stock award having a grant value of $1,700,000, split as follows:

(A) that number of shares of performance-based restricted stock (with a performance period of 2020-2022) determined by dividing $950,000 by the price per share of the Company’s common stock as of the close of business on the Date of Grant (as defined below), and

(B) non-qualified stock options, having a grant value of $750,000, an exercise price equal to the Fair Market Value (as defined in the grant document) of a share of Company common stock on the Date of Grant, a ten (10)-year term and that vest in three equal annual installments on the first, second and third anniversaries of the Effective Date, respectively (the number of shares of the Company’s common stock to which the Executive will be entitled to exercise shall be determined using the Black-Scholes model for option pricing); and

(ii)          A time-based restricted stock award covering that number of shares of the Company’s common stock determined by dividing $1,050,000 by the price per share of the Company’s common stock as of the close of business on the Date of Grant, vesting in three equal annual installments on the first, second and third anniversaries of the Effective Date, respectively. Notwithstanding anything to the contrary set forth in this Agreement, in the event that the Executive’s employment is terminated at any time by the Company for any reason other than for Cause or is terminated by the Executive for Good Reason, those shares of the time-based restricted stock award set forth in this Subsection 3.2(c)(ii) above are not vested, will become fully-vested.

For purposes of this Section 3.2(c), the “Date of Grant” shall be the date that is two (2) full trading days following the Effective Date. To the extent that the equity awards under this Section 3.2(c) are not granted pursuant to the Company’s 2012 Stock Incentive Plan, the Company shall take all steps necessary to satisfy the applicable rules of the New York Stock Exchange and to promptly register the shares comprising these grants via SEC Form S-8.

3.3              Benefit Programs. During the Employment Period, the Executive will be entitled to participate on substantially the same terms as other members of senior management of the Company in all employee benefit plans and programs of the Company (other than any severance plan, program or policy), subject to any restrictions or eligibility requirements under such plans and programs, from time to time in effect for the benefit of senior management of the Company, including, but not limited to, retirement plans, profit sharing plans, stock incentive and annual bonus plans, group life insurance, and supplemental executive short-term and long-term disability.

3.4              Relocation Expense. The Company will pay the Executive’s expenses incurred in any relocation of her principal residence occurring on or before the first anniversary of the Effective Date, pursuant to the Company’s full relocation assistance as outlined in the Company’s benefits program. The Company will pay the Executive’s reasonable expenses for temporary housing and commuting travel expenses incurred prior the Executive’s relocation of her principal residence. All temporary housing and commuting travel expenses and relocation expenses will be fully grossed up for all taxes incurred by the Executive thereon. The Executive is subject to repay the relocation expenses (along with all grossed up amounts paid to or otherwise covered by the Company on behalf of the Executive) to the Company in the event of termination by the Company for Cause or resignation by Executive other than either for Good Reason occurring on or prior to the first anniversary of the date of the last relocation expense reimbursed to the Executive.

3.5              Vacations and Holidays. During the Employment Period, the Executive will be entitled to vacation leave of four (4) weeks per year at full pay or such greater vacation benefits as may be provided for by the Company’s vacation policies applicable to senior management. The Executive will be entitled to such holidays as are established by the Company for all employees.

3.6              Automobile Allowance. During the Employment Period, the Company will provide the Executive with an automobile allowance in accordance with Company policy.

4.                  Expenses.

4.1              Business Expenses. The Executive will be entitled to prompt reimbursement for all reasonable, documented and necessary expenses incurred by the Executive in performing her services hereunder in accordance with the policies of the Company, provided that the Executive properly accounts therefor in accordance with the policies and procedures established by the Company.

4.2              Legal Fees. The Company will pay, promptly upon presentation of one or more invoices, the Executive’s reasonable professional legal fees incurred to negotiate and prepare this Agreement and all related agreements hereto.

5.                  Termination of Employment by the Company.

5.1              Termination by the Company Other Than For Disability or Cause. The Company may terminate the Executive’s employment at any time other than (a) by reason of the Executive’s Disability (as defined in Section 5.2) or (b) for Cause (as defined in Section 5.3), by giving the Executive a written notice of termination at least 30 days before the date of termination (or such lesser notice period as the Executive may agree to). In the event of such a termination of employment pursuant to this Section 5.1, the Executive shall be entitled to receive (i) the benefits described in Section 8 if such termination of employment does not occur within 18 months following a Change of Control, or (ii) the benefits described in Section 9 if such termination of employment occurs on or within 18 months following a Change of Control, in addition to the waiver of any refund obligation under Section 3.2(b).

5.2              Termination Due to Disability. If the Executive incurs a Disability, as defined below, the Company may terminate the Executive’s employment by giving the Executive written notice of termination at least 30 days before the date of such termination (or such lesser notice period as the Executive may agree to). In the event of such termination of the Executive’s employment because of Disability, the Executive shall be entitled to receive (a) her base salary pursuant to Section 3.1 through the first anniversary of the date of such termination of employment, reduced by any amounts paid to the Executive under any disability program maintained by the Company, such base salary, as reduced, to be paid in accordance with the standard payroll practices of the Company; (b) a pro rata bonus for the fiscal year of termination, calculated as the product of (x) the annual performance-based bonus that would have been payable to the Executive for the fiscal year of termination (determined as of the end of such fiscal year) and (y) a fraction, the numerator of which is the number of days in the current fiscal year through the date of termination and the denominator of which is 365 (366 if a leap year), to be paid at the normal time for payment of such bonus in the fiscal year following the fiscal year to which the bonus relates; (c) any unpaid annual bonus earned for a prior completed fiscal year, which bonus shall be paid at the normal time for payment of such bonus in the fiscal year in which such termination occurs; (d) any other compensation and benefits to the extent actually earned by the Executive under any other benefit plan or program of the Company as of the date of such termination of employment, such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid, and (e) any reimbursement amounts owing under Section 4. In addition, if the Executive elects to continue coverage under the Company’s health plan pursuant to the Consolidated Omnibus Budget Reconciliation Act (“COBRA’), then for the period beginning on the date of the Executive’s termination of employment and ending on the earlier of (i) the first anniversary of such termination of employment or (ii) the date the Executive becomes eligible for health insurance benefits under the group health plan of another employer, the Company will pay the same percentage of the Executive’s premium for COBRA coverage for the Executive and, if applicable, her spouse and dependent children, as the Company paid at the applicable time for coverage under such plan for actively employed members of senior management generally. For the period beginning on the date of the Executive’s termination of employment and ending on the earlier of (A) the first anniversary of the date of such termination of employment or (B) the date on which the Executive becomes eligible for life insurance benefits from another employer, the Company will continue to provide the life insurance benefits that the Company would have provided to the Executive if the Executive had continued in employment with the Company for such period, but only if the Executive timely pays the portion of the premium for such coverage that members of senior management of the Company generally are required to pay for such coverage, if any. The Executive shall notify the Company promptly if she, while eligible for benefits under this Section 5.2, becomes eligible to receive health and/or life insurance benefits from another employer. In the event that the Executive’s participation in the Company’s group life insurance plan is barred, the Company shall arrange to provide the Executive with comparable life insurance coverage to the extent available at a cost not to exceed 125% of the cost of the group life insurance coverage offered to the Executive through the Company’s group life insurance plan; provided that the Executive shall pay the same proportionate share of the premium for such coverage that members of senior management of the Company generally are required to pay for group life insurance coverage under the Company’s group life insurance plan, if any.

For purposes of this Agreement, the Executive shall be considered to have incurred a “Disability” if and only if the Executive is by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months (i) unable to engage in any substantial gainful activity, or (ii) receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Company.

5.3              Termination for Cause. The Company may terminate the Executive’s employment immediately for “Cause” for any of the following reasons: (a) an act or acts of dishonesty or fraud by the Executive relating to the performance of her services to the Company; (b) a breach by the Executive of her duties or responsibilities under this Agreement resulting in significant demonstrable injury to the Company or any of its subsidiaries; (c) the Executive’s conviction of a felony or any crime involving moral turpitude; (d) the Executive’s material failure (for reasons other than death or Disability) to perform her duties under this Agreement or insubordination (defined as refusal to execute or carry out directions from the Board or its duly appointed designees) where the Executive has been given written notice of the acts or omissions constituting such failure or insubordination and the Executive has failed to cure such conduct, where susceptible to cure, within ten days following such notice; or (e) a breach by the Executive of any provision of any material policy of the Company or of her obligations under the confidentiality, non-competition and invention ownership agreement executed by the Executive and attached hereto as Exhibit A (the “Confidentiality Agreement”). The Company shall exercise its right to terminate the Executive’s employment for Cause by giving the Executive written notice of termination specifying in reasonable detail the circumstances constituting such Cause. In the event of such termination of the Executive’s employment for Cause, the Executive shall be entitled to receive only (i) her base salary pursuant to Section 3.1 earned through the date of such termination of employment plus her base salary for the period of any vacation time earned but not taken for the year of termination of employment, such base salary to be paid in a lump sum no later than the next payroll date following the Executive’s date of termination to the extent not previously paid, (ii) any other compensation and benefits to the extent actually earned by the Executive under any other benefit plan or program of the Company as of the date of such termination of employment, such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid and (iii) any reimbursement amounts owing under Section 4.

6.                 Termination of Employment by the Executive.

(a)               Good Reason. The Executive may terminate her employment for Good Reason by giving the Company a written notice of termination at least 30 days before the date of such termination (or such lesser notice period as the Company may agree to) specifying in reasonable detail the circumstances constituting such Good Reason. In the event of the Executive’s termination of her employment for Good Reason, the Executive shall be entitled to receive (A) the benefits described in Section 8 if such termination of employment does not occur within 18 months following a Change of Control, or (B) the benefits described in Section 9 if such termination of employment occurs on or within 18 months following a Change of Control, in addition to the waiver of any refund obligation under Section 3.2(b). For purposes of this Agreement, Good Reason shall mean, without the Executive’s written consent, (i) a significant reduction in the scope of the Executive’s authority, functions, duties or responsibilities (including reporting responsibilities) from that which is contemplated by this Agreement; provided that a change in scope solely as a result of the Company no longer being public shall not constitute Good Reason, (ii) any material reduction in the Executive’s base salary, other than an across-the-board reduction affecting substantially all members of senior management of the Company on substantially the same proportional basis, (iii) any material breach by the Company of any provision of this Agreement without the Executive having committed any material breach of the Executive’s obligations hereunder or under the Confidentiality Agreement, in each case, which breach is not cured within thirty (30) days following written notice thereof to the Company of such breach, or (iv) the relocation of the Executive’s office location to a location more than 50 miles away from the Executive’s then current principal place of employment or the Company’s Corporate Headquarters (principal place of business). For purposes of this Agreement, Good Reason shall not include the failure of the Executive to reelected to the Board of Directors by a vote of the shareholders in accordance with the Company’s charter and/or bylaws,. If an event constituting a ground for termination of employment for Good Reason occurs, and the Executive fails to give notice of termination within 30 days after the occurrence of such event, the Executive shall be deemed to have waived her right to terminate employment for Good Reason in connection with such event (but not for any other event for which the 30-day period has not expired).

(b)               Other. The Executive may terminate her employment at any time and for any reason, other than pursuant to subsection (a) above, by giving the Company a written notice of termination to that effect at least 30 days before the date of termination (or such lesser notice period as the Company may agree to); provided, however, that the Company following receipt of such notice from the Executive may elect to have the Executive’s employment terminate immediately following its receipt of such notice. In the event of the Executive’s termination of her employment pursuant to this subsection (b), the Executive shall be entitled to receive only (i) her base salary pursuant to Section 3.1 earned through the date of such termination of employment plus her base salary for the period of vacation time earned but not taken for the year of termination of employment, such base salary to be paid in a lump sum no later than the next payroll date following the Executive’s date of termination to the extent not previously paid, (ii) any other compensation and benefits to the extent actually earned by the Executive under any other benefit plan or program of the Company as of the date of such termination of employment, such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid, and (iii) any reimbursement amounts owing under Section 4.

7.                  Termination of Employment By Death. In the event of the death of the Executive during the course of her employment hereunder, the Executive’s estate (or other person or entity having such entitlement pursuant to the terms of the applicable plan or program) shall be entitled to receive (a) the Executive’s base salary pursuant to Section 3.1 earned through the date of the Executive’s death plus the Executive’s base salary for the period of vacation time earned but not taken for the year of the Executive’s death, such base salary to be paid in a lump sum no later than the next payroll date following the Executive’s date of termination to the extent not previously paid, (b) a bonus for the year of the Executive’s death (to be paid within 90 days after the Executive’s death) in an amount equal to a pro rata portion of the average of the three highest annual bonuses earned by the Executive under the Company’s annual bonus plan for any of the five fiscal years preceding the calendar year of the Executive’s death (or, if the Executive was not eligible for a bonus for at least three fiscal years in such five-year period, then the average of such bonuses for all of the calendar years in such five-year period for which the Executive was eligible, and if occurring during the first such year then the average shall be deemed to be a target level bonus), with any deferred bonuses counting for the year earned rather than the year paid and with the pro rata portion being determined by dividing the number of days of the Executive’s employment during such calendar year up to her death by 365 (366 if a leap year), (c) any unpaid annual bonus earned for a prior completed fiscal year, which bonus shall be paid at the normal time for payment of such bonus in the fiscal year of the Executive’s death; (d) any other compensation and benefits to the extent actually earned by the Executive under any other benefit plan or program of the Company as of the date of such termination of employment, such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid, and (e) any reimbursement amounts owing under Section 4. In addition, in the event of such death, the Executive’s beneficiaries shall receive any death benefits owed to them under the Company’s employee benefit plans. If the Executive’s spouse and/or dependent children elect to continue coverage under the Company’s health plan following the Executive’s death pursuant to COBRA, the Company for a period of 12 months following the Executive’s death will pay the same percentage of the premium for COBRA coverage for the Executive’s spouse and/or dependent children, as applicable, as the Company would have paid in respect of the Executive’s coverage under such plan if the Executive had continued in employment with the Company for such period.

8.                  Benefits Upon Termination Without Cause or For Good Reason (No Change of Control). If (a) the Executive’s employment hereunder shall terminate (i) because of termination by the Company pursuant to Section 5.1, or (ii) because of termination by the Employee for Good Reason pursuant to Section 6(a), and (b) such termination of employment does not occur on or within 18 months following a Change of Control of the Company, the Executive shall be entitled to the following:

(a)               The Company shall pay to the Executive her base salary pursuant to Section 3.1 earned through the date of such termination of employment, plus the Executive’s base salary for the period of vacation time earned but not taken for the year of the Executive’s termination, in a lump sum no later than the next payroll date following the Executive’s date of termination to the extent not previously paid, and any other compensation and benefits to the extent actually earned by the Executive under any benefit plan or program of the Company as of the date of such termination of employment, any such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid.

(b)               The Company shall pay the Executive any reimbursement amounts owing under Section 4.

(c)               The Company shall pay to the Executive in equal installments spread over the period of 12 months beginning on the date of the Executive’s termination of employment an amount equal in the aggregate to the sum of (i) the Executive’s annual rate of base salary in effect immediately preceding her termination of employment, and (ii) the average of her annual bonuses earned under the Company’s annual bonus plan for the three fiscal years preceding her termination of employment (or, if the Executive was not eligible for a bonus in each of those three fiscal years, then the average of such bonuses for all of the fiscal years in which the Executive was eligible, and if occurring prior to the end of the first such year for which the Executive was eligible, then the average shall be deemed to be a target level bonus), with any subjective performance requirements for any unpaid bonus earned for a prior fiscal year deemed fully satisfied, and with any deferred bonuses counting for the year earned rather than the year paid (such sum the “Severance Benefit”). The Severance Benefit shall be paid in equal installments over a twelve (12) month period at the same intervals that salary payments are normally made by the Company; provided that, if at the time of the Employee's termination of employment, (A) the Employee is a “specified employee” as defined in subsection (a)(2)(B)(i) of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) (a “Specified Employee”), and (B) the Severance Benefit is nonqualified deferred compensation under Code Section 409A, then the portion of the Severance Benefit that is nonqualified deferred compensation subject to Code Section 409A shall be paid as provided in Section 12, below.

(d)               If the Executive elects to continue coverage under the Company’s health plan pursuant to COBRA, then for the period beginning on the date of the Executive’s termination of employment and ending on the earlier of (i) the first anniversary of the date of such termination of employment or (ii) the date the Executive becomes eligible for health insurance benefits under the group health plan of another employer, the Company will pay the same percentage of the Executive’s premium for COBRA coverage for the Executive and, if applicable, her spouse and dependent children, as the Company paid at the applicable time for coverage under such plan for actively employed members of senior management generally. In addition, for the period beginning on the date of the Executive’s termination of employment and ending on the earlier of (A) the first anniversary of the date of such termination of employment or (B) the date on which the Executive becomes eligible for life insurance benefits from another employer, the Company will continue to provide the life insurance benefits that the Company would have provided to the Executive if the Executive had continued in employment with the Company for such period, but only if the Executive timely pays the portion of the premium for such coverage that members of senior management of the Company generally are required to pay for such coverage, if any. The Executive shall notify the Company promptly if she, while eligible for benefits under this subsection (d), becomes eligible to receive health and/or life insurance benefits from another employer. In the event that the Executive’s participation in the Company’s group life insurance plan is barred, the Company shall arrange to provide the Executive with comparable life insurance coverage to the extent available at a cost not to exceed 125% of the cost of the group life insurance coverage offered through the Company’s group life insurance plan; provided that the Executive shall pay the same proportionate share of the premium for such coverage that members of senior management of the Company generally are required to pay for group life insurance coverage under the Company’s group life insurance plan, if any.

(e)               The Executive shall be entitled to any unpaid annual bonus earned for a prior completed fiscal year, which bonus shall be paid at the normal time for payment of such bonus in the fiscal year in which such termination occurs;

(f)                The Company will pay to the outplacement services provider reasonably selected by the Executive an amount not to exceed $10,000 for outplacement services costs incurred by Executive within the twelve months following the Executive’s termination of employment.

(g)               The Company’s obligation to provide the severance benefits set forth in Sections 8(c), (d) and (e) upon the Executive’s termination of employment without Cause or for Good Reason, which does not occur on or within 18 months following a Change of Control, is subject to the Executive’s execution without revocation of a valid release in within 60 days of Executive’s termination of employment or such shorter period as the Company may require at the time substantially the form attached to this Agreement as Exhibit B (the “Release”).

9.                  Benefits Upon Termination Without Cause or For Good Reason (Change of Control). If (a) the Executive’s employment hereunder shall terminate (i) because of termination by the Company pursuant to Section 5.1, or (ii) because of termination by the Employee for Good Reason pursuant to Section 6(a), and (b) such termination of employment occurs on or within 18 months following a Change of Control of the Company, the Executive shall be entitled to the following:

(a)               The Company shall pay to the Executive her base salary pursuant to Section 3.1 earned through the date of such termination of employment in a lump sum no later than the next payroll date following the Executive’s date of termination to the extent not previously paid, and any other compensation and benefits to the extent actually earned by the Executive under any benefit plan or program of the Company as of the date of such termination of employment, any such compensation and benefits to be paid at the normal time for payment of such compensation and benefits to the extent not previously paid.

(b)               The Company shall pay the Executive any reimbursement amounts owing under Section 4.

(c)               The Company shall pay to the Executive as a severance benefit an amount equal to two (2) times the sum of (i) her annual rate of base salary in effect immediately preceding her termination of employment, and (ii) the average of her three highest annual bonuses earned under the Company’s annual bonus plan for any of the five fiscal years preceding her termination of employment (or, if the Executive was not eligible for a bonus for at least three fiscal years in such five-year period, then the average of such bonuses for all of the calendar years in such five-year period for which the Executive was eligible, and if occurring during the first such fiscal year, such average shall be deemed to be a target bonus amount), with any deferred bonuses counting for the year earned rather than the year paid (the “COC Severance Benefit”). The COC Severance Benefit shall be paid in a lump sum within thirty (30) days after the date of such termination of employment; provided that, if at the time of the Employee's termination of employment, (i) the Employee is a Specified Employee, and (ii) the COC Severance Benefit is nonqualified deferred compensation subject to the provisions of Code Section 409A, then any portion of the COC Severance Benefit that is nonqualified deferred compensation subject to Code Section 409A shall be paid as provided in Section 12, below.

(d)               The Executive shall be entitled to any unpaid annual bonus earned for a prior completed fiscal year, which bonus shall be paid at the normal time for payment of such bonus in the fiscal year in which such termination occurs. The Company shall also pay to the Executive as a bonus for the year of termination of her employment an amount equal to a portion (determined as provided in the next sentence) of the Executive’s target bonus opportunity under the Company’s annual bonus plan for the fiscal year of termination of the Executive’s employment or, if none, such portion of the bonus awarded to the Executive under the Company’s annual bonus plan for the fiscal year immediately preceding the fiscal year of the termination of the Executive’s employment, with deferred bonuses counting for the year earned rather than the year paid. Such portion shall be determined by dividing the number of days of the Executive’s employment during such calendar year up to her termination of employment by 365 (366 if a leap year). Such payment shall be made in a lump sum within 30 days after the date of such termination of employment, and the Executive shall have no right to any further bonuses under said plan; provided that, if at the time of the Executive’s termination of employment, the Executive is a Specified Employee, then any portion of such payment that is nonqualified deferred compensation subject to Code Section 409A shall be made in a lump sum then any portion of the COC Severance Benefit that is nonqualified deferred compensation subject to Code Section 409A shall be paid as provided in Section 12, below, and the Executive shall have no right to any further bonuses under said plan.

(e)               For the period beginning on the date of the Executive’s termination of employment and ending on the earlier of (i) the second anniversary of such termination of employment or (ii) the date the Executive becomes eligible for comparable benefits from another employer, the Executive (and, if applicable, the Executive’s spouse and dependent children) shall remain covered by the medical, dental, life insurance, and, if reasonably commercially available through nationally reputable insurance carriers, long-term disability plans of the Company that covered the Executive immediately prior to her termination of employment as if the Executive had remained in employment for such period; provided, however, that the coverage under any such plan is conditioned on the timely payment by the Executive (or her spouse or dependent children) of the portion of the premium for such coverage that actively employed members of senior management of the Company generally are required to pay for such coverage. In the event that the Executive’s participation in any such plan is barred, the Company shall arrange to provide the Executive (and, if applicable, her spouse and dependent children) with comparable benefits to the extent available at a cost not to exceed 125% of the cost of providing benefits to the Executive under the Company’s plan or plans. The Executive shall notify the Company promptly if she, while eligible for benefits under this subsection (e), becomes eligible to receive benefits from another employer.

(f)               Each stock option granted by the Company to the Executive and outstanding immediately prior to termination of her employment shall be fully vested and immediately exercisable and may be exercised by the Executive (or, following her death, by the person or entity to which such option passes) at any time prior to the expiration date of the applicable option (determined without regard to any earlier termination of the option that would otherwise occur by reason of termination of her employment). Each restricted stock award and performance share award granted by the Company to the Executive and outstanding immediately prior to termination of the Executive’s employment shall be fully vested upon such termination of employment, with any such performance share award deemed earned at the greater of (i) target and (ii) the amount reasonably projected to be earned under the terms of the award based on the performance achievement through the date of termination.

(g)               The Company will pay to the outplacement services provider reasonably selected by the Executive an amount not to exceed $10,000 for outplacement services costs incurred by Executive within the twelve months following the Executive’s termination of employment.

(h)               The Company shall promptly pay all reasonable attorneys’ fees and related expenses incurred by the Executive in seeking to obtain or enforce any right or benefit under this Section 9 or to defend against any claim or assertion in connection with this Section 9, but only if and to the extent that the Executive substantially prevails on at least one material issue in such dispute.

(i)                 The Company will pay to the Executive an automobile allowance, in an amount equal to the Executive’s monthly allowance at the time of termination, each month for 24 months following termination of the Executive’s employment; provided that, if at the time of the Executive’s termination of employment, the Executive is a Specified Employee, then twenty-five percent (25%) of the automobile allowance shall be paid in a lump sum on the date that is six (6) months after the date of termination, and the remaining seventy-five percent (75%) of the automobile allowance shall be paid in eighteen (18) equal monthly installments, beginning in the seventh month following the date of termination.

(j)                 The Company’s obligation to provide the severance benefits set forth in Sections 9(c), (d), (e), (f), (g) and (i) upon the Executive’s termination of employment without Cause or for Good Reason on or within 18 months following a Change of Control is subject to the Executive’s execution without revocation of the Release within 60 days of Executive’s termination of employment or such shorter period as the Company may require at the time.

10.              Change of Control. For the purposes of this Agreement, a “Change of Control” shall be deemed to occur upon the consummation of any of the following events provided that such event constitutes a change in control event within the meaning of Treasury Regulation §1.409A-3(i)(5) where required for compliance with Code Section 409A: (a) any person or persons acting together which would constitute a “group” for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (other than the Company or any subsidiary of the Company) shall beneficially own (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, at least 25% of the total voting power of all classes of capital stock of the Company entitled to vote generally in the election of the Board; (b) Current Directors (as herein defined) shall cease for any reason to constitute at least a majority of the members of the Board (for this purpose, a “Current Director” shall mean any member of the Board as of the date hereof and any successor of a Current Director whose election, or nomination for election by the Company’s shareholders, was approved by at least a majority of the Current Directors then on the Board); (c) (i) the complete liquidation of the Company or (ii) the merger or consolidation of the Company, other than a merger or consolidation in which (x) the holders of the common stock of the Company immediately prior to the consolidation or merger have, directly or indirectly, at least a majority of the common stock of the continuing or surviving corporation immediately after such consolidation or merger or (y) the Board immediately prior to the merger or consolidation would, immediately after the merger or consolidation, constitute a majority of the board of directors of the continuing or surviving corporation, which liquidation, merger or consolidation has been approved by the shareholders of the Company; or (d) the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company pursuant to an agreement (or agreements) which has (have) been approved by the shareholders of the Company.

11.              Golden Parachute Excise Tax.

(a)               In the event that any payment or benefit received or to be received by the Executive pursuant to this Agreement or any other plan, program or arrangement of the Company or any of its affiliates would constitute an “excess parachute payment” within the meaning of Section 280G of the Code (“Excess Parachute Payment”), then the payments under this Agreement shall be reduced (by the minimum possible amounts) until no amount payable to the Executive under this Agreement constitutes an Excess Parachute Payment; provided, however, that no such reduction shall be made if the net after-tax payment (after taking into account Federal, state, local or other employment, income and excise taxes) to which the Executive would otherwise be entitled without such reduction would be greater than the net after-tax payment (after taking into account Federal, state, local or other employment, income and excise taxes) to the Executive resulting from the receipt of such payments with such reduction. If, as a result of subsequent events or conditions (including a subsequent payment or absence of a subsequent payment under this Agreement or other plan, program or arrangement of the Company or any of its affiliates), it is determined that payments under this Agreement have been reduced by more than the minimum amount required to prevent any payments from constituting an Excess Parachute Payment, then an additional payment shall be promptly made to the Executive in an amount equal to the additional amount that can be paid without causing any payment to constitute an Excess Parachute Payment.

(b)               All determinations required to be made under this Section 11 shall be made by a nationally recognized independent accounting firm mutually agreeable to the Company and the Executive (the “Accounting Firm”) which shall provide detailed supporting calculations to the Company and the Executive as requested by the Company or the Executive. All fees and expenses of the Accounting Firm shall be borne solely by the Company and shall be paid by the Company upon demand of the Executive as incurred or billed by the Accounting Firm. All determinations made by the Accounting Firm pursuant to this Section 11 shall be final and binding upon the Company and the Executive.

(c)               To the extent any payment or benefit is to be reduced pursuant to this Section 11, the severance payment described in Section 8(c) or 9(c) will first be reduced and then the bonus described in Section 9(d), in each case only to the extent necessary.

12.              Section 409A of the Code.

(a)             If (i) the Executive is determined to be a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i), (ii) any amounts payable under this Agreement are “nonqualified deferred compensation” subject to Code Section 409A, and (iii) such amounts are payable on the Employee’s “separation from service,” as defined in Treasury Regulation Section 1.409A-1(h), then such amounts will be payable on a monthly basis after Executive’s termination of employment (or, if earlier, the date of death of Employee).  To the maximum extent permitted by applicable law, amounts payable to the Executive pursuant to Section 8 or Section 9 herein shall be made in reliance upon the exception for certain involuntary terminations under a separation pay plan or as short-term deferral under Code Section 409A. Payments under this Section to which an Executive would otherwise be entitled during the first six (6) months following Executive’s termination date will be accumulated and paid on the day that is six (6) months after the termination date.

(b)              Any taxable reimbursements under this Agreement will be made no later than the end of the calendar year following the calendar year the expense was incurred. For purposes of complying with Section 409A: (i) payment of such reimbursements or in-kind benefits during one calendar year will not affect the amount of such reimbursement or in-kind benefits provided during a subsequent calendar year; and (ii) such reimbursement benefit or rights or in-kind benefits may not be exchanged or substituted for another form of compensation to the Executive. The Executive’s right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and distinct payments.

(c)             Any severance payments due as a result of Executive’s termination of employment with the Company will be made only upon a “separation from service,” as defined in Treasury Regulation Section 1.409A-1(h).

(d)             Any other provision of this Agreement to the contrary notwithstanding, in no event shall any payment or benefit under this Agreement that constitutes nonqualified deferred compensation for purposes of Code Section 409A be subject to offset by any other amount unless otherwise permitted by Code Section 409A.

(e)             To the extent any amount payable to the Executive is subject to her entering into a Release and any such amount is nonqualified deferred compensation under Code Section 409A and which amount could be payable in either of two taxable years for the Executive, such payments shall be made or commence, as applicable, on the first business day of the later such taxable year (or any later date within seven (7) days after the Release becomes irrevocable) and shall include all payments that otherwise would have been made before such date.

(f)             In no event shall the Company be liable to the Executive for or with respect to any taxes, penalties or interest which may be imposed upon the Executive pursuant to Section 409A other than caused by the gross negligence or willful misconduct of any Company employee in the administration of the terms of this Agreement. The Executive hereby acknowledges that she has been advised to seek and has sought the advice of a tax advisor with respect to the tax consequences to the Executive of all payments pursuant to this Agreement, including any adverse tax consequences or penalty taxes under Code Section 409A and applicable state tax law. The Executive hereby agrees that no representations have been made to the Executive relating to the tax treatment of any payment pursuant to this Agreement under Code Section 409A and the corresponding provisions of any applicable state income tax laws.

13.              Entitlement to Other Benefits. Except as otherwise provided in this Agreement, this Agreement shall not be construed as limiting in any way any rights or benefits that the Executive or her spouse, dependents or beneficiaries may have pursuant to any other plan or program of the Company; provided that the Executive shall not be eligible to receive any benefits under any circumstances under any severance plan or policy of the Company.

14.              General Provisions.

14.1          No Duty to Seek Employment; No Mitigation or Offset. The Executive shall not be under any duty or obligation to seek or accept other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and, except as specifically provided otherwise under this Agreement, and no amount, payment or benefits due to the Executive hereunder shall be reduced or suspended if the Executive accepts subsequent employment or self-employment activity after the Executive’s termination of employment from the Company, except as expressly set forth herein.

14.2          Deductions and Withholding. All amounts payable or which become payable under any provision of this Agreement shall be subject to any deductions authorized by the Executive and/or any deductions and withholdings required by law.

14.3          Notices. All notices, demands, requests, consents, approvals or other communications (collectively “Notices”) required or permitted to be given hereunder or which are given with respect to this Agreement shall be in writing and shall be delivered personally, sent by facsimile transmission with a copy deposited in the United States mail, registered or certified, return receipt requested, postage prepaid, or sent by overnight mail addressed as follows:

or such other address as such party shall have specified most recently by written notice. Notice mailed as provided herein shall be deemed given when so delivered personally or sent by facsimile transmission, or, if sent by overnight mail, on the day after the date of mailing.

14.4          No Disparagement. Neither the Executive nor the Company (via any authorized public statement) or its officers or directors shall, during the period of the Executive’s employment with the Company, nor following the date of termination of her employment for any reason, publish or communicate to any person or entity any Disparaging (as defined below) remarks, comments or statements concerning (i) by the Executive: the Company, or any of its subsidiaries or affiliates or any of their shareholders, directors, officers, employees or agents or (ii) by the Company, any officer or director: the Executive. “Disparaging” remarks, comments or statements are those that impugn the character, honesty, integrity or morality or business acumen or abilities in connection with any aspect of the operation of business of the individual or entity being disparaged. The parties agree that the terms of this Section 14.4 shall survive the term of this Agreement and the termination of the Executive’s employment.

14.5          Obligation to Resign upon Termination The Executive must resign from any office held in the Company and/or any of its subsidiaries if requested in writing to do so by the Company (or, with respect to the Executive’s position as a member of the Board, by the Board) on the termination of her employment. If the Executive does not do so on being requested to do so, the Company is hereby irrevocably authorized to appoint a person in her name to sign and deliver any required letter(s) of resignation to the Company.

14.6          Proprietary Information and Inventions. The Confidentiality Agreement is incorporated by reference in this Agreement, and the Executive agrees to continue to be bound thereby.

14.7          Covenant to Notify Management. The Executive agrees to abide by the ethics policies of the Company as well as the Company’s other rules, regulations, policies and procedures. The Executive agrees to comply in full with all governmental laws and regulations as well as ethics codes as may be applicable. In the event that the Executive is aware or suspects the Company, or any of its officers or agents, of violating any such laws, ethics, codes, rules, regulations, policies or procedures, the Executive agrees to bring all such actual and suspected violations to the attention of the Company immediately so that the matter may be properly investigated and appropriate action taken. Notwithstanding anything to the contrary, the Executive is not prohibited from reporting possible violations of law or regulations to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of applicable law or regulation, and the Executive is not required to obtain the Company’s approval or notify the Company that the Executive intends to make or has made such a report or disclosure.

14.8          Amendments and Waivers. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by the Executive and the Company. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

14.9          Beneficial Interests. This Agreement shall inure to the benefit of and be enforceable by (a) the Company’s successors and assigns and (b) the Executive’s personal and legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If the Executive shall die while any amounts are still payable to her hereunder, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to the Executive’s devisee, legatee, or other designee or, if there be no such designee, to the Executive’s estate.

14.10          Successors. The Company will require any successors (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform.

14.11          Assignment. This Agreement and the rights, duties, and obligations hereunder may not be assigned or delegated by any party without the prior written consent of the other party and any attempted assignment or delegation without such prior written consent shall be void and be of no effect. Notwithstanding the foregoing provisions of this Section 14.11, the Company may assign or delegate its rights, duties and obligations hereunder to any affiliate or to any person or entity which succeeds to all or substantially all of the business of the Company or one of its subsidiaries through merger, consolation, reorganization, or other business combination or by acquisition of all or substantially all of the assets of the Company or one of its subsidiaries without the Executive’s consent.

14.12          Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut without regard to the conflicts of law provisions thereof.

14.13          Indemnification. On or prior to the Effective Date, the Company and the Executive shall enter into and indemnification agreement in the form of agreement provided to the Executive with this Agreement (“Indemnification Agreement”). At all times during the Employment Period and thereafter during which the Executive may be subject to liability, the Company will cover the Executive as an insured under any contract of directors and officers liability insurance that covers members of the Board.

14.14          Statute of Limitations. The Executive and the Company hereby agree that there shall be a one year statute of limitations for the filing of any requests for arbitration or any lawsuit in a court of competent jurisdiction relating to this Agreement or the terms or conditions of Executive’s employment by the Company (other than as may be provided under the Indemnification Agreement or any indemnification otherwise provided under the Company charter or by-laws or applicable law). If such a claim is filed more than one year subsequent to the Executive’s last day of employment it shall be precluded by this provision, regardless of whether or not the claim has accrued at that time.

14.15          Right to Injunctive and Equitable Relief. The parties’ respective obligations under Section 14.4 are of a special and unique character, which gives them a peculiar value. An aggrieved party cannot be reasonably or adequately compensated for damages in an action at law in the event an others party breaches such obligations. Therefore, the parties expressly agree that the aggrieved party shall be entitled to injunctive and other equitable relief without bond or other security in the event of such breach in addition to any other rights or remedies which the aggrieved party may possess or be entitled to pursue. Furthermore, the respective obligations of each party and the rights and remedies of the other party under Section 14.4 and this Section 14.15 are cumulative and in addition to, and not in lieu of, any obligations, rights, or remedies as created by applicable law. The parties agree that the terms of this Section 14.15 shall survive the term of this Agreement and the termination of the Executive’s employment.

14.16          Severability or Partial Invalidity. The invalidity or unenforceability of any 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.

14.17          Entire Agreement. This Agreement, along with the exhibits hereto, the equity award agreements under Section 3.2(c), the Indemnification Agreement and the Confidentiality Agreement, constitute the entire agreement of the parties and supersedes all prior written or oral and all contemporaneous oral agreements, understandings, and negotiations between the parties with respect to the subject matter hereof. This Agreement may not be changed orally and may only be modified in writing signed by both parties. This Agreement, along with the Confidentiality Agreement, is intended by the parties as the final expression of their agreement with respect to such terms as are included herein and therein and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement, along with the Confidentiality Agreement, constitutes the complete and exclusive statement of their terms and that no extrinsic evidence may be introduced in any judicial proceeding involving such agreements. For the avoidance of doubt, the terms of the Confidentiality Agreement do not prevent the Executive from communicating directly with a government agency regarding any potential or pending investigation, either during or after my employment with the Company.

14.18          Counterparts. This Agreement may be executed in any number of counterparts (including any electronic exchange via Adobe pdf signed copies), each of which when so executed shall be deemed an original but all of which together shall constitute one and the same instrument.

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IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer and the Employee has hereunto set her hand as of the day and year first above written.

EXHIBIT A

Lydall, Inc.

(Also referred to as the “Company”)

Confidentiality, Invention and Non-Compete Agreement

In consideration of my employment by the Company, or future employment with an affiliate to whom I am transferred (together the “Company”), the compensation and other benefits to be received by me from the Company, I agree that:

1.     Definitions

The term “Confidential Information” as used in this Agreement includes all business information and records which relate to the Company or to parties working with the Company under a confidentiality agreement, and which are not known to the public generally, including, but not limited to, technical notebook records, technical reports, patent applications, machine equipment, computer software, models, process and product designs including any drawings and descriptions, unwritten knowledge and “know-how”, operating instructions, training manuals, production and development processes, production or other schedules, customer lists, customer buying records, product sales records, sales requests, territory listings, market surveys, plans including marketing plans and long-range plans, salary information, contracts, supplier lists, product costs, policy statements, policy procedures, policy manuals, flowcharts, computer printouts, program listings, reproductions and correspondence.

The term “Invention” as used in this Agreement includes any discovery, improvement, design or idea, patentable, copywriteable or otherwise, which relates to any activity or business in which the Company is engaged or any process, equipment, material, product or method (including computer software) in which the Company has any direct or indirect interest.

2.     Inventions

I will disclose promptly to the Company any Invention conceived, developed or perfected by me, either alone or jointly with another or others, while I am an employee, whether or not such conception, development or perfection occurs during the hours of my employment.

I grant to the Company without further compensation, all my right, title and interest in and to any such Invention for the sole use and benefit of the Company, together with all U.S. and foreign patents, trademarks or copyrights that may at any time be granted, and all reissues, renewals and extensions of such patents, trademarks or copyrights. At the request and expense of the Company, I will at any time do what the Company reasonably believes to be necessary to assist the Company to vest full right and title to each such Invention in the Company, enable the Company to obtain and maintain full right and title in any country, prosecute applications for and secure patents (including their reissue, renewal and extension), trademarks, copyrights and any other form of protection for each such Invention, and prosecute or defend any interference or opposition which may be declared involving any such application or patent and any litigation in which the Company may be involved concerning any such Invention. This will include preparing, executing and delivering any written document, drawings, flowcharts, or computer printouts. The provisions of this section will continue after I stop working for the Company and shall be binding on my executors, administrators and assigns, unless waived in writing by the Company.

3.     Confidential Information

I have not disclosed and will not disclose to the Company, and I will not use, in the discharge of my duties as an employee of the Company, any trade secret or confidential or proprietary information belonging to a former employer or other person. The limitation set forth in this section shall not apply to matters which (a) are or become public knowledge, (b) were previously known to the Company, (c) are subsequently received by the Company from a third party, or (d) are independently derived by the Company.

I will not, directly or indirectly, during or at any time after the period of my employment by the Company, use for myself or others, or disclose to others, any Confidential Information, no matter how such information becomes known to me, unless I first obtain the Company’s written consent.

When I leave the Company’s employ, or at any other time upon request by the Company, I will promptly deliver to the Company all documents and records, including but not limited to those listed under the definition of Confidential Information, which are in my possession or under my control and which pertain to the Company, any of its activities or any of my activities while in the course of my employment and all copies thereof. I will not retain or deliver to any others copies of these documents or records.

4.     Non-Competition

I acknowledge and agree that the Company’s business competes upon a worldwide basis, and that the degree of competition in that business is high. I recognize that, in my capacity, my responsibilities are global in nature but that there are specific markets in which the Company competes. I agree that, unless I first obtain the Company’s written consent, I will not during my employment with the Company and for a period of one (1) year following the termination of my employment (provided, however, that if I am employed by the Company for less than one (1) year, the post-employment period to which this section applies shall be the greater of six (6) months or the length of my employment in any capacity), directly or indirectly or through others, individually, or as a member, officer, director, employee, agent, or investor of any partnership or entity (except ownership of not more than one percent (1%) of the outstanding publicly traded stock of any company):

For purposes of this Section 4, a “business competitive with the Company” is the business of  designing, manufacturing, marketing, distributing and/or selling the (a) specialty engineered products for the thermal/acoustical and filtration/separation markets, sold by the Company, including air or liquid filtration media, industrial thermal insulating solutions, and automotive thermal and acoustical barriers and (b) such other products in those industries in which the Company operates, during the last twelve (12) months of my employment or has taken substantial steps to operate as planned during my employment.

I further understand and agree that the remedy at law for any breach or threatened breach of my agreement not to compete contained in this section would be inadequate and that any breach or attempted breach would result in irreparable damage to the Company, the monetary amount of which would be impossible to ascertain. Thus, I agree that in the event of any breach or threatened breach of my agreement not to compete, in addition to all other available legal or equitable remedies, the Company may obtain injunctive relief to remedy damage caused by such breach or threatened breach, and that the Company shall be entitled to recover from me its costs and expenses, including reasonable attorney fees, incurred in remedying such breach or threatened breach.

5.     General Terms

I represent and agree that I have and will assume no obligations to others inconsistent with any of my obligations to the Company under this Agreement. I represent and agree that the performance of my duties and obligations as an employee of the Company does not, and shall not, breach any agreement that obligates me to refrain from competing, directly or indirectly, with the business of any other party.

In consideration of my employment, I agree to conform to the policies of the Company. I understand that my employment is for an indefinite period and can be terminated at any time, with or without cause or prior notice by either the Company or me. No other representations or agreements have been made regarding the term or termination of my employment.

This Agreement, which is ancillary to any other agreement I may have with the Company, (a) is intended as the complete and exclusive statement of my agreement with the Company with respect to its subject matter, (b) shall be binding upon my heirs, executors and administrators, (c) shall be assignable by the Company to its successors; (d) shall not be modified unless in writing and signed by me and the Company, (e) shall be governed by and construed in accordance with the law of the State of Connecticut, the Company’s home office state, and (f) if any part of this Agreement is found invalid by any court, the remainder shall be valid and enforceable in law and equity.

I understand that the terms of this confidentiality covenant are not intended to prevent me from communicating directly with a government agency regarding any potential or pending investigation, either during or after my employment with the Company.

EXHIBIT B

TERMINATION, VOLUNTARY RELEASE AND WAIVER OF RIGHTS AGREEMENT *

I, Sara A. Greenstein, unqualifiedly accept and agree to the relinquishment of my title, responsibilities and obligations as an employee of Lydall, Inc. (“the Company”), and concurrently and unconditionally agree to sever my relationship as an employee of the Company, in consideration for the voluntary payment to me by the Company of the separation benefits set forth in Section __ of the Employment Agreement dated as of October 11, 2019 by and between me and the Company (the “Employment Agreement”), which is made a part hereof.

1.       In exchange for this consideration, which I understand that the Company is not otherwise obligated to provide to me, I voluntarily agree to waive and forego any and all claims, rights, interests, covenants, contracts, warranties, promises, undertakings, actions, suits, causes of action, obligations, debts, attorneys’ fees or other expenses, accounts, judgments, fines, fees, losses and liabilities, of any kind, nature or description, in law, equity or otherwise (collectively, “Claims”) that I may have against the Company and to release the Company and their respective affiliates, subsidiaries, officers, directors, employees, representatives, agents, successors and assigns (hereinafter collectively referred to as “Releasees”) from any obligations any of them may owe to me, accepting the aforestated consideration as full settlement of any monies or obligations owed to me by Releasees that may have arisen at any time prior to the date of my execution of this Termination, Voluntary Release and Waiver of Rights Agreement (the “Agreement”), except as specifically provided below in the following paragraph number 2.

2.       I do not waive, nor has the Company asked me to waive, any rights arising exclusively under the Fair Labor Standards Act, except as such waiver may henceforth be made in a manner provided by law. I do not waive, nor has the Company asked me to waive, any vested benefits that I may have or that I may have derived from the course of my employment with the Company. I understand that such vested benefits will be subject to and administered in accordance with the established and usual terms governing same. I do not waive any rights which may in the future, after the execution of this Agreement, arise exclusively from a substantial breach by the Company of a material obligation of the Company expressly undertaken in consideration of my entering into this Agreement. I do not waive any rights that I may have as a stockholder of the Company. I do not waive any rights that I may have under the Indemnification Agreement (as defined in the Employment Agreement), the Company charter or by-laws, or applicable law, to be indemnified and held harmless for my acts and omissions to act while an officer or member of the Board of Directors of the Company, or for coverage as an insured under any applicable contract of directors and officers liability insurance.

3.       Except as set forth in paragraph 2, I do fully, irrevocably and forever waive, relinquish and agree to forego any and all Claims whatsoever, whether known or unknown, that I may have or may hereafter have against the Releasees or any of them arising out of or by reason of any cause, matter or thing whatsoever from the beginning of the world to the date hereof, including without limitation any and all matters relating to my employment with the Company and the cessation thereof and all matters arising under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000 et seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq., the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq., the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., all as amended, or under any other laws, ordinances, executive orders, regulations or administrative or judicial case law arising under the statutory or common laws of the United States, the State of Connecticut or any other applicable county or municipal ordinance.

4.       As a material inducement to the Company to enter into this Agreement, I, the undersigned, recognize that I may have been privy to certain confidential, proprietary and trade secret information of the Company which, if known to third parties, could be used in a manner that would reduce the value of the Company for its shareholders. In order to reduce the risk of that happening, I, the undersigned, agree that for a period of two (2) years after termination of employment, I, the undersigned, will not, directly or indirectly, assist, or be part of or have any involvement in, any effort to acquire control of the Company through the acquisition of its stock or substantially all of its assets, without the prior consent of the Board of Directors of the Company. This provision shall not prevent the undersigned from owning up to not more than one percent (1%) of the outstanding publicly traded stock of any company.

5.       I further acknowledge pursuant to the Older Worker’s Benefit Protection Act (29 U.S.C. § 626(f)), I expressly agree that the following statements are true:

a.       The payment of the consideration described in Section __ of the Employment Agreement is in addition to the standard employee benefits and anything else of value which the Company owes me in connection with my employment with the Company or the separation of employment.

b.       I have [twenty-one days] days from [date of receipt] to consider and sign this agreement. If I choose to sign this Agreement before the end of the [twenty-one] day period, that decision is completely voluntary and has not been forced on me by the Company.

c.       I will have seven (7) days after signing the Agreement in which to revoke it, and the Agreement will not become effective or enforceable until the end of those seven (7) days.

d.       I am now being advised in writing to consult an attorney before signing this Agreement.

I acknowledge that I have been given sufficient time to freely consult with an attorney or counselor of my own choosing and that I knowingly and voluntarily execute this Agreement, after bargaining over the terms hereof, with knowledge of the consequences made clear, and with the genuine intent to release claims without threats, duress, or coercion on the part of the Company. I do so understanding and acknowledging the significance of such waiver.

6.       Further, in view of the above-referenced consideration voluntarily provided to me by the Company, after due deliberation, I agree to waive any right to further litigation or claim against any or all of the Releasees except as specifically provided in paragraph number 2 above. I hereby agree to indemnify and hold harmless the Releasees and their respective agents or representatives from and against any and all losses, costs, damages or expenses, including, without limitation, attorneys fees incurred by said parties, or any of them, arising out of any breach of paragraph 1 or paragraph 3 of this Agreement by me or by any person acting at my direction, or the fact that any representation made herein by the undersigned was false when made.

7.       As a material inducement to the Company to enter into this Agreement, I, the undersigned, understand and agree that if I should fail to comply with the conditions of paragraphs 1, 3 or 4 hereof, all amounts previously paid under this Agreement shall be immediately forfeited to the Company and that the right or claim to further payments and/or benefits hereunder would likewise be forfeited.

8.       As a further material inducement to the Company to enter into this Agreement, the undersigned provides as follows:

First. I represent that I have not filed any complaints or charges against the Company, or any of the Releasees relating to the relinquishment of my former titles and responsibilities at the Company or the terms of my employment with the Company and that if any agency or court assumes jurisdiction of any complaint or charge against the Company or any of the Releasees on behalf of me concerning my employment with the Company, I understand and agrees that I have, by my knowing and willing execution of this Agreement waived my rights to any form of recovery or relief against the Company, or any of the Releasees, including but not limited to, attorney’s fees. Provided, however, that this provision shall not preclude the undersigned from pursuing appropriate legal relief against the Company for redress of a substantial breach of a material obligation of the Company expressly undertaken in consideration of my entering into this Agreement.

Second. I acknowledge and understand that the consideration for this release shall not be in any way construed as an admission by the Company or any of the Releasees of any improper acts or any improper employment decisions, and that the Company, specifically disclaims any liability on the part of itself, the Releasees, and their respective agents, employees, representatives, successors or assigns in this regard.

Third. I acknowledge and agree that this Agreement shall be binding upon me, upon the Company, and upon our respective administrators, representatives, executives, successors, heirs and assigns and shall inure to the benefit of said parties and each of them.

Fourth. I represent, understand and agree that this Agreement sets forth the entire agreement between the parties hereto, and fully supersedes any and all prior agreements or understandings between the parties pertaining to the subject matter hereof, except for the confidentiality and non-competition agreement previously executed by me (a copy of which is attached to the Employment Agreement as Exhibit A and is made a part hereof) and the Indemnification Agreement entered into by the parties, the terms of which retain their full force and effect, and which are in no way limited or curtailed by this Agreement.

Fifth. Modification. This Agreement may not be altered or changed except by an agreement in writing that has been properly executed by the party against whom any waiver, change, modification or discharge is sought.

Sixth. Severability. All provisions and terms of this Agreement are severable. The invalidity or unenforceability of any particular provision(s) or term(s) of this Agreement shall not affect the validity or enforceability of the other provisions and such other provisions shall be enforceable in law or equity in all respects as if such particular invalid or unenforceable provision(s) or term(s) were omitted. Notwithstanding the foregoing, the language of all parts of this Agreement shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties.

Seventh. Mutual No Disparagement. The Company and undersigned affirm their respective rights and obligations pursuant to Section 14.4 of the Employment Agreement.

Eighth. Confidentiality. The Company and the undersigned agree to refrain from disclosing to third parties and to keep strictly confidential all details of this Agreement and any and all information relating to its negotiation, except as necessary to each party’s accountants or attorneys.

Ninth.       Termination of Agreement. Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated by the Company and all further payment obligations of the Company will cease, if: (a) the undersigned is terminated for Cause prior to the undersigned’s separation date; or (b) facts are discovered after the undersigned’s separation date that would have supported a termination for Cause had such facts been discovered prior to the undersigned’s separation date. “Cause” has the meaning defined in the Employment Agreement.

[Signature page follows]

AFFIRMATION OF RELEASOR

I, Sara A. Greenstein, warrant that I am competent to execute this Termination, Voluntary Release and Waiver of Rights Agreement and that I accept full responsibility thereof.

I, Sara A. Greenstein, warrant that I have had the opportunity to consult with an attorney of my choosing with respect to this matter and the consequences of my executing this Termination, Voluntary Release and Waiver of Rights Agreement.

I, Sara A. Greenstein, have read this Termination, Voluntary Release and Waiver of Rights Agreement carefully and I fully understand its terms. I execute this document voluntarily with full and complete knowledge of its significance.

Executed this         day of                         , 20          at                                                         .

Accepted and agreed by the Company:

* Note to Draft:  The Parties agree that the Company may revise this form of release to reflect changes in law, additional statutes or claims, benefits, or your circumstances, so that the Company receives the benefit of the most complete release of claims that is legally permissible and may also change the timing, if required to obtain such release.  This endnote is part of the form of release agreement and is to be removed only when the Company finalizes this Termination, Voluntary Release and Waiver of Rights Agreement.

Exhibit 10.2

INDEMNIFICATION AGREEMENT

This Agreement, made and entered into this 11^th day of October, 2019 (“Agreement”), by and between Lydall, Inc., a Delaware corporation (“Company”), and Sara A. Greenstein (“Indemnitee”):

WHEREAS, highly competent persons are becoming more reluctant to serve publicly-held corporations as directors or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation; and

WHEREAS, the current impracticability of obtaining adequate insurance and the uncertainties relating to indemnification have increased the difficulty of attracting and retaining such persons;

WHEREAS, the Board of Directors of the Company has determined that the inability to attract and retain such persons is detrimental to the best interests of the Company’s stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future; and

WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified; and

WHEREAS, Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that she be so indemnified;

NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:

Section 1. Services by Indemnitee. Indemnitee agrees to serve as a director and officer of the Company and of such of the Company’s subsidiaries as the Company may designate. Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law), in which event, without limiting the obligations of the Company under this Agreement with respect to the Indemnitee’s service while in such position, the Company shall have no obligation under this Agreement to continue Indemnitee in such position.

Section 2. Indemnification - General. The Company shall indemnify, and advance Expenses (as hereinafter defined) to, Indemnitee (a) as provided in this Agreement and (b) to the fullest extent permitted by applicable law in effect on the date hereof and as amended from time to time. The rights of Indemnitee provided under the preceding sentence shall include, but shall not be limited to, the rights set forth in the other Sections of this Agreement.

Section 3. Proceedings Other than Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 3 if, by reason of her Corporate Status (as hereinafter defined), she is, or is threatened to be made, a party to any threatened, pending, or completed Proceeding (as hereinafter defined), other than a Proceeding by or in the right of the Company. Pursuant to this Section 3, Indemnitee shall be indemnified against all expenses, judgements, penalties, fines, and amounts paid in settlement actually and reasonably incurred by her or on her behalf in connection with such Proceeding or any claim, issue or matter therein, if she acted in good faith and in a manner be reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal Proceeding, had no reasonable cause to believe her conduct was unlawful.

Section 4. Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4 if, by reason of her Corporate Status, she is, or is threatened to be made, a party to any threatened, pending or completed Proceeding brought by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by her or on her behalf in connection with such Proceeding if she acted in good faith and in a manner she reasonably believed to be in or not opposed to the best interests of the Company; provided, however, that if applicable law so provides, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company unless and to the extent that the Court of Chancery of the State of Delaware, or the court in which such Proceeding shall have been brought or is pending, shall determine that such indemnification may be made.

Section 5. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of her Corporate Status, a party to and is successful, on the merits or otherwise, in any Proceeding, she shall be indemnified against all Expenses actually and reasonably incurred by her or on her behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee against all expenses actually and reasonably incurred by her or on her behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

Section 6. Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of her Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, she shall be indemnified against all Expenses actually and reasonably incurred by her or on her behalf in connection therewith.

Section 7. Advancement of Expenses. The Company shall advance all reasonable Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding within ten days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or accompanied by an undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be indemnified against such Expenses.

Section 8. Procedures for Determination of Entitlement to Indemnification.

(a)       To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. The Secretary of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification.

(b)       Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 8(a) hereof, a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall be made in the specific case; (i)if a Change in Control (as hereinafter defined) shall be made in the Independent Counsel (as hereinafter defined) in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee; or (ii) if a Change of Control shall not have occurred, (A) by the Board of Directors by a majority vote of a quorum consisting of Disinterested Directors (as hereinafter defined), or (B) if a quorum of the Board of Directors consisting of Disinterested Directors is not obtainable or, even if obtainable, such quorum of Disinterested Directors so directs, by Independent Counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to Indemnitee or (C) if so directed by the Board of Directors, by the stockholders of the Company; and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any costs or expenses (including attorneys’ fees and disbursements) incurred by Indemnitee in so cooperating with this person, persons or entity making such determination shall be borne by the Company (Irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

(c)       In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 8(b) hereof, the Independent Counsel shall be selected as provided in this Section 8(c). If a Change of Control shall not have occurred, the Independent Counsel shall be selected by the Board of Directors, and the Company shall give written notice to Indemnitee advising her of the identity of the Independent Counsel so selected. If a Change of Control shall have occurred, the Independent Counsel shall be selected by Indemnitee (unless Indemnitee shall request that such selection be made by the Board of Directors, in which event the preceding sentence shall apply), and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either event, Indemnitee or the Company, as the case may be, may, within 10 days after such written notice of selection shall have been given, deliver to the Company or to Indemnitee, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 17 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If, within 20 days after submission by Indemnitee of a written request for indemnification pursuant to Section 8(a) hereof, no Independent Counsel shall have been selected and not objected to, either the Company or Indemnitee may petition the Court of Chancery of the State of Delaware or other court of competent jurisdiction for resolution of any objection which shall have been made the Company or Indemnitee to the other’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by the Court of by such other person as the Court shall designate, and the person with respect to whom all objections are so resolved or the person so appreciated shall act as Independent Counsel under Section 8(b) hereof. The Company shall pay any and all reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to Section 8(b) hereof, and the Company shall pay all reasonable fees and expenses incident to the procedures of this Section 8(c), regardless of the manner in which such Independent Counsel was selected or appointed. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 10(a)(iii) of this Agreement, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

Section 9. Presumptions and Effect of Certain Proceedings.

(a)       If a Change of Control shall have occurred, in making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 8(a) of this Agreement, and the Company shall have the burden of proof to overcome that presumption in connection with the making by any person, persons or entity of any determination contrary to that presumption.

(b)       The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement of conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which she reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that her conduct was unlawful.

Section 10. Remedies of Indemnitee.

(a)       In the event that (i) a determination is made pursuant to Section 8 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 7 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 8(b) of this Agreement within 90 days after receipt by the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to Section 5 or 6 of this Agreement within ten (10) days after receipt by the Company of a written request therefor, or (v) payment of indemnification is not made within 10 (10) days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication in an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of her entitlement to such indemnification or advancement of Expenses. Alternatively, Indemnitee, at her option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence such proceeding seeking an adjudication or an award in arbitration within 180 days following the data on which Indemnitee first has the right to commence such proceeding pursuant to this Section 10(a); provided, however, that the foregoing clause shall not apply in respect of a proceeding brought by Indemnitee to enforce her rights under Section 5 of this Agreement.

(b)       In the event that a determination shall have been made pursuant to Section 8(b) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 10 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that adverse determination. If a Change of Control shall have occurred, in any judicial proceeding or arbitration commenced pursuant to this Section 10 the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be.

(c)       If a determination shall have been made pursuant to Section 8(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 10, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.

(d)       In the event that Indemnitee, pursuant to this Section 10, seeks a judicial adjudication of or an award in arbitration to enforce her rights under, or to recover damages for breach of, this Agreement, Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Company against, any and all expenses (of the types described in the definition of Expenses in Section 17 of this Agreement) actually and reasonably incurred by her in such judicial adjudication or arbitration, but only if she prevails therein. If it shall be determined in said judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advancement of expenses sought, the expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be appropriately prorated.

Section 11. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.

(a)       The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the By-Laws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee in her Corporate Status prior to such amendment, alteration or repeal.

(b)       To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees, or agents of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which such person serves at the request of the Company, Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies.

(c)       In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnities, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

(d)       The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that Indemnities has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

Section 12. Duration of Agreement. This Agreement shall continue until and terminate upon the later of: (a) 10 years after the date that Indemnitee shall have ceased to serve as a director, officer, employee, or agent of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which Indemnitee served at the request of the Company; or (b) the final termination of any Proceeding then pending in respect of which Indemnitee is granted rights of indemnification or advancement of expenses hereunder and of any proceeding commenced by Indemnitee pursuant to Section 10 of this Agreement relating thereto. This Agreement shall be binding upon the Company and its successors and assigns and shall inure to the benefit of Indemnitee and her heirs, executors and administrators.

Section 13. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed to as to give effect to the intent manifested thereby.

Section 14. Exception to Right of Indemnification or Advancement of Expenses. Notwithstanding any other provision of this Agreement, Indemnitee shall not be entitled to indemnification or advancement of Expenses under this Agreement with respect to any Proceeding brought by Indemnitee, or any claim therein prior to a Change in Control, unless the bringing of such Proceeding or making of such claim shall have been approved by the Board of Directors.

Section 15. Identical Counterparts. This agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

Section 16. Headings. The headings of the paragraphs of this Agreement re inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

Section 17. Definitions.

(a)       The phrase “Change of Control,” as used in this Agreement, shall mean i) an acquisition of the Company by means of a merger or consolidation or purchase of substantially all of its assets if and when incident thereto (A) the composition of the Board of Directors of the Company (the “Board”) or its successor changes so that a majority of the Board is not comprised of individuals who were members of the board immediately prior to such merger, consolidation or purchase of assets or (B) the stockholders of the Company acquire a right to receive, in exchange for or upon surrender a majority of their stock, cash or other securities or a combination of the two; and/or ii) the acquisition by a person (as that term is hereafter defined) of the voting rights with respect to 25 percent or more of the outstanding Common Stock of the Company if such person was not an officer or director of the Company on the date of this Agreement; and/or iii) the election or appointment to the Board of any director or directors whose appointment or election or nomination for election was not approved by a vote of at least a majority of the directors then still in office who were either directors on the date hereof or whose election, appointment or nomination for election was previously so approved.

(b)       “Corporate Status” describes the status of a person who is or was a director, officer, employee or agent of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which such person is or was serving at the request of the Company.

(c)       “Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

(d)       “Expenses” shall include all reasonable attorney’s fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, or being or preparing to be a witness in a Proceeding.

(e)       “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party, or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

(f)       “Proceeding” includes any action, suit, arbitration, alternate dispute resolution mechanism, investigation, administrative hearing or any other proceeding, whether civil, criminal, administrative, or investigative, except one (i) initiated by an Indemnitee pursuant to Section 10 of this Agreement to enforce her rights under this Agreement or (ii) pending on or before the date of this Agreement.

Section 18. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

Section 19. Notice by Indemnitee. Indemnitee agrees promptly to notify the Company in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder.

Section 20. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, or (ii) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed:

(a)      If to Indemnitee, to:

Sara A. Greenstein

Address: At the most recent address shown
on the payroll records of the Company

(b)      If to the Company to:

Lydall, Inc.

P.O. Box 151

One Colonial Road

Manchester, CT 06045-0151

Attn: General Counsel (on behalf of Board of Directors)

or to such other address as may have been furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

Section 21. Governing Law. The parties agree that this Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware.

Section 22. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.

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IN WITNESS WHEREOF, the parties hereto have executed this Indemnification Agreement on the day and year first written.

Exhibit 10.3

SEPARATION AND TRANSITION AGREEMENT

This Separation and Transition Agreement (“this Agreement”) is made and entered into by and among Lydall, Inc. (the “Company”), on the one hand, and Dale G. Barnhart (“Barnhart”) on the other hand (collectively, the “Parties”) is dated October 11, 2019 and effective as of November 18, 2019 (the “Effective Date”).

1.                  Transition of Service. As of the Effective Date, Barnhart resigns as President and Chief Executive Officer of the Company; however, the Company has asked Barnhart, and Barnhart has agreed, to continue his employment in a new capacity through the conclusion of a transition period (the “Transition Period”), as described in Section 2 below. Barnhart’s final day of employment at the conclusion of the Transition Period shall be December 31, 2019 (the “Separation Date”).

a.                   This Agreement confirms Barnhart’s voluntary irrevocable resignation as President and Chief Executive Officer of the Company and as a member of the Board of Directors, and from any and all other executive and director positions he holds with the Company and any and all of the Company’s subsidiaries and other affiliates (the “Other Positions”), which resignation shall become effective on the Effective Date. The Company hereby agrees to waive any requirement of written notice as otherwise required under the Executive Employment Agreement between Barnhart and the Company dated July 2007 (the “Employment Agreement”).

b.                  Prior to the commencement of the Transition Period, Barnhart shall continue to serve in his positions as President and Chief Executive Officer of the Company, as well as in the Other Positions, under the terms and conditions of the Employment Agreement. Notwithstanding the immediately preceding sentence or any other provision hereof, the Board may reassign and delegate any or all of Barnhart’s responsibilities to one or more other individuals (each, an “Interim Delegate”), to be performed by him or her in lieu of by Barnhart. For the avoidance of doubt, neither such a reassignment or delegation of a responsibility to an Interim Delegate, nor any performance thereof by such Interim Delegate, shall constitute a termination for Good Reason (as defined in Section 1.6 of the Employment Agreement) under Section 4.4 of the Employment Agreement.

c.                   The Company shall reimburse Barnhart his actual attorney fees incurred in negotiation of this Agreement, not to exceed $10,000.

2.                  Transition Period. In exchange for the mutual covenants in this Agreement, the Company agrees to employ Barnhart during the Transition Period on the following terms and conditions:

a.                   Barnhart shall serve as Senior Advisor to the Board of Directors of the Company (“Senior Advisor”) during the period starting from the Effective Date through December 31, 2019. The Company will employ Barnhart on an at-will basis during the Transition Period. Accordingly, Barnhart understands that, during the Transition Period, either the Company or Barnhart may terminate Barnhart’s employment at any time, for any or no reason, with or without prior notice; provided, however, that Barnhart will receive in one lump sum the remaining compensation he would have received pursuant to Section 2(c) as if the Transition Period would have continued to the full term.

b.                  During the Transition Period, Barnhart shall report directly to the Board of Directors and perform those services for the Company as directed by the Chairman of the Board. On or before the Separation Date, Barnhart shall return to the Company all confidential or proprietary information in his possession, in whatever medium that information exists, and not retain any such information thereafter except upon permission of the Company’s General Counsel. Additionally, Barnhart shall assist the Company with the transfer of information, job responsibilities and business strategy, communications with employees and customers, and other transition-related tasks as requested by the Company.

c.                   The Company will continue to pay Barnhart at his current base salary, less all customary and required taxes and employment-related deductions, in accordance with the Company’s normal payroll practice, while he is employed during the Transition Period. The Company will continue Barnhart’s participation in the Company’s benefit plans during the Transition Period, under the same terms and conditions as he currently is participating, while he is employed during the Transition Period.

d.                  The Company shall pay Barnhart a separation bonus in the amount of $629,300 (which is equal to his target level bonus payout for 2019 calculated in accordance with the Company’s 2019 Annual Incentive Performance (“AIP”) Program), to be paid in one (1) lump-sum payment, less applicable withholdings, in the last paycheck of 2019.

e.                   During the Transition Period, all equity currently granted to him shall continue to vest through the Separation Date. Any shares or options not vested as of the Separation Date will be terminated, and Barnhart hereby confirms said unvested shares/options will be surrendered, canceled and forfeited to the Company and returned to the Company’s applicable stock incentive plan(s).

f.                    During the Transition Period, the Company will continue to provide all benefits and prerequisites currently provided to Barnhart (including, but not limited to, an automobile allowance and gas card) in accordance with Company policy. Barnhart will also have access, during the Transition Period, access to administrative support and office space at one or more of the Company’s facilities.

g.                  During the Transition Period, upon presentation of appropriate receipts, the Company shall reimburse Barnhart for all documented, out-of-pocket expenses Barnhart incurs in the performance of Barnhart’s duties as Senior Advisor to the Board of Directors, including but not limited to expenses Barnhart incurs when traveling on Company business when requested by the Board, the CEO or an Interim Delegate to do so.

h.                  The Company and Barnhart agree that, as of the Effective Date, the Employment Agreement shall be null and void and that this Agreement establishes the terms of his employment during the Transition Period and the terms of his transition from the Company. For the avoidance of doubt, Barnhart shall no longer be eligible to receive any benefits described in Section 3 (Compensation and Benefits) of the Employment Agreement.

i.                    Following the termination or expiration of the Transition Period (and during the Transition Period as to any responsibility reassigned and delegated to an Interim Delegate as contemplated by Section 1(c)), Barnhart shall not hold himself out as an officer, director, executive, employee, leased employee, temporary employee, agent or other representative of the Company.

Barnhart acknowledges and agrees that the offer of the Transition Period is not otherwise due to Barnhart under any Company employment agreement (oral or written) or policy or practice, and is not intended to and shall not constitute a severance plan, and shall confer no benefit on anyone other than the Parties. Barnhart further acknowledges that, except for the specific financial consideration set forth herein and benefits to which he is otherwise entitled under the Company’s benefit plans, he is not entitled to any other compensation including, without limitation, wages, bonuses, vacation pay, holiday pay or any other form of compensation or benefit.

3.                  Consulting Term and Compensation. Following the Separation Date, Barnhart shall serve as Senior Consultant to the Company for a period of three (3) months after the Separation Date (the “Consulting Term”), ending on March 31, 2020. The Company will engage Barnhart on an at-will, consultancy basis during the Consulting Term. Accordingly, Barnhart understands that, during the Consulting Term, either the Company or Barnhart may terminate Barnhart’s engagement as Senior Consultant at any time, for any or no reason, with or without prior notice.

a.                  As Senior Consultant, and on an as-needed basis upon reasonable notice from the Company, Barnhart shall provide transition and other related consultancy services to the Company during the Consulting Term in order to assist in providing an effective transition of Barnhart’s responsibilities to Barnhart’s successor as President and Chief Executive Officer. Barnhart shall advise the Board, Barnhart’s successor and any Interim Delegate or Interim Delegates on matters involving Company strategy, mergers and acquisitions, organizational considerations and other matters as are specified by the Board. Barnhart shall diligently and competently perform such services and use all reasonable efforts in connection with the performance of such services.

b.                  Barnhart and the Company agree that, during the Consulting Term, the anticipated level of all services that Barnhart may perform for the Company as Senior Consultant shall not be in excess of an average of twenty (20) hours per week.

c.                  During the Consulting Term, upon presentation of appropriate receipts, the Company shall reimburse Barnhart for all documented, out-of-pocket expenses Barnhart incurs in the performance of Barnhart’s duties as Senior Consultant, including but not limited to expenses Barnhart incurs when traveling on Company business when requested by the Board, the CEO or an Interim Delegate to do so.

d.                  During the Consulting Term and following the termination or expiration of the Consulting Term, Barnhart shall not hold himself out as an officer, director, executive, employee, leased employee, temporary employee, agent or other representative of the Company.

e.                  In consideration of Barnhart’s compliance with the terms hereof, and as compensation for Barnhart’s service as Senior Consultant within the timeframe provided therein, the Company shall provide Barnhart the following payments (the “Consulting Term Compensation”). As compensation for Barnhart’s services as Senior Consultant during the Consulting Term, the Company shall pay Barnhart an advisory fee in the amount of $60,775 per month, less applicable taxes and withholdings (if any). For the avoidance of doubt, Barnhart shall be entitled to no additional compensation for Barnhart’s services following the Separation Date except as set forth in this section.

4.                  Waiver and Release.

a.                   Barnhart expressly acknowledges and agrees that: (a) neither this Agreement nor the Parties’ performance hereunder constitutes a termination without “Cause” by the Company or “Good Reason” by Barnhart under any agreement between Barnhart and the Company (including but not limited to Section 5.3 or Section 6(a) of the Employment Agreement) or any Company policy or plan applicable to Barnhart; (b) Barnhart expressly waives and releases any right or claim by Barnhart or on Barnhart’s behalf that this Agreement or the Parties’ performance hereunder: (i) constitutes a termination without “Cause” by the Company or “Good Reason” by Barnhart under any agreement between Barnhart and the Company or any other Company policy or plan, or (ii) entitles Barnhart to any form of severance payment or benefit under any agreement between Barnhart and the Company (including but not limited to the payments and benefits described in Sections 8 or 9 of the Employment Agreement) or any other Company policy or plan (collectively, “Severance Compensation”); and (c) Barnhart’s waiver and release described in the preceding subsection (b) constitutes an appropriate waiver and/or modification by the Party entitled to the benefits of the waived term or provision, as permitted by Section 13.7 of the Employment Agreement. This release includes waivable claims relating to the Severance Compensation under state or federal law relating to wage payments, and under state or federal common law (e.g., breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, violation of public policy, misrepresentation, deceit or fraud), but excludes any claims that Barnhart cannot waive by operation of law, and any claims related to a breach of this Agreement.

b.                  The Company’s obligation to provide the payments set forth in Section 2(d), is subject to the Barnhart’s execution without revocation of a valid release in substantially the form attached to this Agreement as Exhibit A (the “Release”).

5.                  Restrictive Covenants. In connection with Barnhart’s continued employment with the Company and his transition to the Senior Advisor role and in exchange for the benefits described herein, and for other good and valuable consideration, receipt of which is hereby acknowledged, Barnhart expressly acknowledges and agrees that certain restrictions on his activities are necessary to protect the goodwill, confidential information and other legitimate interests of the Company and its affiliates. Accordingly, as of the Effective Date, Barnhart agrees as follows:

a.                   During Executive’s employment, the Consultancy Term and for a period of one (1) year following the end of the Consultancy Term (the “Restricted Period”), Barnhart shall not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, coventurer or otherwise, compete with the business of the Company or any of its affiliates anywhere in the world where the Company or any of its affiliates is doing business or undertake any planning for competition with the Company or any of its affiliates. Specifically, but without limiting the foregoing, Barnhart agrees not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of the Company or any of its affiliates as conducted or under consideration at any time during Barnhart’s employment (including, but not limited, the Transition Period and the Consultancy Term) or to provide services in any capacity to a competitor of the Company or any of its affiliates. The business of the Company and its affiliates is the business of the Products. The foregoing condition, however, shall not fail to be met solely due to Barnhart’s passive ownership of less than five (5%) percent of the equity securities of any publicly traded company. For purposes of this Agreement, “Products” means all products planned, researched, developed, tested, manufactured, sold, licensed, leased or otherwise distributed or put into use by the Company or any of its affiliates, together with all services provided or planned by the Company or any of its affiliates, during Barnhart’s employment (including, but not limited, the Transition Period and the Consultancy Term).

b.                  During the Restricted Period, and excluding any activities undertaken on behalf of the Company or any of its affiliates in the course of his duties, he will not directly or indirectly solicit or encourage any customer of the Company or any of its affiliates to terminate or diminish its relationship with the Company or any of its affiliates; or directly or indirectly solicit or encourage any customer or potential customer of the Company or any of its affiliates to conduct with any person any business or activity which such customer or potential customer conducts or could conduct with the Company or any of its affiliates.

c.                   During the Restricted Period, and excluding any activities undertaken on behalf of the Company or any of its affiliates in the course of his duties, he will not, directly or indirectly, solicit, induce, encourage or attempt to solicit, induce, or encourage, any such employee, independent contractor or agent to terminate or diminish his/her/its relationship with the Company or any of its affiliates.

d.                  Barnhart acknowledges that he has carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed upon him pursuant to this Section 5. Barnhart agrees that those restraints are necessary for the reasonable and proper protection of the Company and its affiliates and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area.

e.                   Barnhart acknowledges that, were he to breach any of the covenants contained in this Section 5, the damage to the Company and its affiliates would be irreparable. Barnhart therefore agrees that the Company, in addition to any other remedies available to it, shall be entitled to preliminary and permanent injunctive relief against any breach or threatened breach by Barnhart of any of said covenants, without having to post bond. The prevailing party in any such action for injunctive relief shall be entitled to an award of his or its reasonable attorneys’ fees incurred in enforcing his or its rights under this Agreement. Should the court find or hold that Barnhart has violated any of such covenants, then within ten (10) business days of his receipt of a written demand by the Board, Barnhart shall be required to repay the Company one hundred (100%) percent of the monetary value of the amounts paid pursuant to Section 2(d) of this Agreement.

f.                    The restrictions and covenants set forth in this Section 5 shall be in addition to, and not in lieu of, any confidentiality, proprietary information, inventions or other agreements which Barnhart has entered into, or hereafter enters into, in connection with his employment or service as a director or advisor of the Company, which are incorporated herein by reference and shall survive the execution and delivery of this Agreement. Notwithstanding the above, Barnhart acknowledges and agrees that, upon the Effective Date, this Section 5 supersedes and replaces the restrictions in of the Employment Agreement. To the extent applicable, Barnhart further acknowledges and agrees that this Section 5 constitutes an appropriate modification and notice thereof as permitted by Sections 13.3 and 13.7 of the Employment Agreement.

6.                  Return of Company Property. Prior to the conclusion of the Transition Period (or earlier as requested by the Company), Barnhart shall return to the Company, and shall not retain in his possession without the express permission of the General Counsel, any Company property, including business records, business documents, or any other materials or property relating to the Company, whether on computer or hard copy, and all copies thereof. Barnhart acknowledges that all such Company property is and shall remain the exclusive property of the Company. Barnhart will be permitted to retain his personal computer and mobile devices, provided that he first makes them available to the Company so that confidential and proprietary information can be removed.

7.                  Cooperation. Barnhart agrees to cooperate fully with the Company in connection with any matter or event relating to Barnhart’s employment or events that occurred during Barnhart’s employment or other engagement to provide advisory services (including but not limited to the Transition Period and the Consultancy Term), including but not limited to (a) cooperating in the defense or prosecution of any claims or actions now in existence or which may be brought or threatened in the future against or on behalf of the Company, including any claims or actions against its affiliates and its and their officers and employees; (b) being available, upon reasonable notice to meet with the Company regarding matters in which Barnhart has been involved, including any contract matters or audits; (c) preparing for, attending and participating in any legal proceeding including, without limitation, depositions, consultation, discovery or trial; (d) providing affidavits and/or acting as a witness in connection with respect to any litigation or other legal proceeding affecting the Company; (e) assisting with any audit, inspection, proceeding or other inquiry. The Company will reimburse Barnhart for all reasonable documented, out-of-pocket expenses he incurs in providing such cooperation to the Company. Barnhart agrees that should Barnhart be contacted (directly or indirectly) by any person or entity (for example, by any party representing an individual or entity) adverse to the Company, Barnhart shall promptly notify the Chairman of the Board prior to the Separation Date. In the event that Barnhart receives an order, subpoena, request, or demand for disclosure of the Company’s trade secrets and/or confidential and proprietary documents and information from any court or governmental agency, or from a party to any litigation or administrative proceeding, Barnhart shall notify the Company of same as soon as reasonably possible and prior to disclosure, in order to provide the Company with the opportunity to assert its respective interests in addressing or opposing such order, subpoena, request, or demand. Notwithstanding anything in this agreement to the contrary, Barnhart and the Company agree that the obligations imposed upon him under this section shall survive the termination or expiration of the Transition Period and the Consultancy Term.

8.                  Acknowledgments. The Parties expressly acknowledge and agree to the following: (a) the payment made under Section 2(d) above represents material consideration for Barnhart’s undertakings and obligations under this Agreement; (b) except as set forth herein, Barnhart is not entitled to and shall not receive any additional payments or benefits of any kind from the Company, and shall not accrue additional benefits under any of the Company’s applicable employee benefit plans; and (c) Barnhart has been or will be paid all compensation to which he was otherwise entitled by the Company prior to or simultaneously with the Separation Date, and there are no additional wages or other compensation due and owing to Barnhart after the Separation Date, except as expressly provided in this Agreement (including the Consultancy Term Compensation).

9.                  Non-Disparagement. Neither Barnhart nor the Company (via any authorized public statement) shall and the Company’s officers or directors shall not, during the Transition Period with the Company, nor following the Transition Period for any reason, publish or communicate to any person or entity any Disparaging (as defined below) remarks, comments or statements concerning (i) by Barnhart: the Company, or any of its subsidiaries or affiliates or any of their shareholders, directors, officers, employees or agents or (ii) by the Company, any officer or director: Barnhart. “Disparaging” remarks, comments or statements are those that impugn the character, honesty, integrity or morality or business acumen or abilities in connection with any aspect of the operation of business of the individual or entity being disparaged. The parties agree that the terms of this Section 9 shall survive the term of this Agreement and the Termination Period.

10.               Confidentiality; No Disclosures. Barnhart agrees not to disclose to anyone, other than his immediate family, accountant and attorney, the circumstances surrounding this Agreement or its terms, conditions or negotiation, and then only upon their express agreement not to disclose such subject matter to another person, except as required or permitted by law (in which case, Barnhart shall, to the extent practicable, notify the Company of such before making any such disclosure).

11.               Non-Admission of Liability. This Agreement is not, and shall not in any way be construed as an admission by either Party that it has acted wrongfully with respect to the other or any other person, or that such has any rights whatsoever against the other, except as set forth herein.

12.               No Modification. No waiver or modification of this Agreement or any term hereof shall be binding unless it is in writing and signed by the Parties hereto or their expressly authorized representatives. In the event that one or more of the provisions of this Agreement shall become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected thereby.

13.               Rule of Ambiguities; Severability. It is agreed and understood that the general rule that ambiguities are to be construed against the drafter shall not apply to this Agreement. In the event that any language in this Agreement is found or claimed to be ambiguous, each Party shall have the same opportunity to present evidence as to the actual intent of the Parties with respect to any such purportedly ambiguous language, without any inference or presumption being drawn against the purported drafter. In the event that one or more of the provisions of this Agreement shall become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not be affected. In the event that any of the provisions with respect to confidentiality, non-competition and/or non-solicitation as set forth in this Agreement are not enforceable in accordance with their terms, Barnhart and the Company agree that such provisions shall be reformed to make them enforceable in the manner which provides the Company with the maximum rights and protections permitted by law.

14.               Governing Law; Venue and Jurisdiction. This Agreement shall be construed in accordance with the laws of the State of Connecticut, without giving effect to conflict of law principles. Any claims or legal actions by one party against the other shall be commenced and maintained in any state or federal court located in the State of Connecticut, and the parties hereby expressly submit to the jurisdiction and venue of any such court and hereby waive any defense based on a lack of jurisdiction.

15.               Successors and Assigns. This Agreement shall be binding upon, and inure to the benefit of, both Parties and their respective successors and assigns, including any corporation with which, or into which, the Company may be merged or which may succeed to its assets or business, provided, however, that the obligations of Barnhart are personal and shall not be assigned by Barnhart.

16.               Entire Agreement. This Agreement, along with the other specific agreements that are expressly incorporated herein by reference and stated as surviving the signing of this Agreement, supersedes any and all prior or contemporaneous oral and written agreements between Barnhart and the Company, and set forth the entire agreement between the Parties with regard to the matters described herein.

17.               Captions. The captions of the paragraphs of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

18.               Voluntary Execution. The Parties hereby acknowledge that they have read and understand this Agreement, that they have affixed their signature hereto voluntarily and without coercion, and that their agreement to the terms contained herein is knowing, conscious and with full appreciation of the meaning of such terms. Barnhart shall have the Review Period to consider whether to execute this Agreement. If Barnhart does not sign and return this Agreement to the Company within the Review Period, this Agreement automatically shall terminate and be withdrawn.

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This Agreement may be executed in counterparts, which together shall be effective as if they were a single document. Signatures of this Agreement transmitted by e-mail or facsimile copy shall have the same force and effect as original signatures.

EXHIBIT A

TERMINATION, VOLUNTARY RELEASE AND WAIVER OF RIGHTS AGREEMENT

I, Dale G. Barnhart, unqualifiedly accept and agree to the relinquishment of my title, responsibilities and obligations as an employee of Lydall, Inc. (“the Company”), and concurrently and unconditionally agree to sever my relationship as an employee of the Company, in consideration for the voluntary payment to me by the Company of the separation benefits set forth in the Separation and Termination Agreement dated as of October 11, 2019 and effective as of November 18, 2019, by and between me and the Company (the “Separation Agreement”), which is made a part hereof.

1.       In exchange for this consideration, which I understand that the Company is not otherwise obligated to provide to me, I voluntarily agree to waive and forego any and all claims, rights, interests, covenants, contracts, warranties, promises, undertakings, actions, suits, causes of action, obligations, debts, attorneys’ fees or other expenses, accounts, judgments, fines, fees, losses and liabilities, of any kind, nature or description, in law, equity or otherwise (collectively, “Claims”) that I may have against the Company and to release the Company and their respective affiliates, subsidiaries, officers, directors, employees, representatives, agents, successors and assigns (hereinafter collectively referred to as “Releasees”) from any obligations any of them may owe to me, accepting the aforestated consideration as full settlement of any monies or obligations owed to me by Releasees that may have arisen at any time prior to the date of my execution of this Termination, Voluntary Release and Waiver of Rights Agreement (the “Agreement”), except as specifically provided below in the following paragraph number 2.

2.       I do not waive, nor has the Company asked me to waive, any rights arising exclusively under the Fair Labor Standards Act, except as such waiver may henceforth be made in a manner provided by law. I do not waive, nor has the Company asked me to waive, any vested benefits that I may have or that I may have derived from the course of my employment with the Company. I understand that such vested benefits will be subject to and administered in accordance with the established and usual terms governing same. I do not waive any rights which may in the future, after the execution of this Agreement, arise exclusively from a substantial breach by the Company of a material obligation of the Company expressly undertaken in consideration of my entering into this Agreement.

3.       Except as set forth in paragraph 2, I do fully, irrevocably and forever waive, relinquish and agree to forego any and all Claims whatsoever, whether known or unknown, that I may have or may hereafter have against the Releasees or any of them arising out of or by reason of any cause, matter or thing whatsoever from the beginning of the world to the date hereof, including without limitation any and all matters relating to my employment with the Company and the cessation thereof and all matters arising under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000 et seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Family and Medical Leave Act of 1993, 29 U.S.C. § 2601 et seq., the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq., the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., all as amended, or under any other laws, ordinances, executive orders, regulations or administrative or judicial case law arising under the statutory or common laws of the United States, the State of Connecticut or any other applicable county or municipal ordinance.

4.       As a material inducement to the Company to enter into this Agreement, I, the undersigned, recognize that I may have been privy to certain confidential, proprietary and trade secret information of the Company which, if known to third parties, could be used in a manner that would reduce the value of the Company for its shareholders. In order to reduce the risk of that happening, I, the undersigned, agree that for a period of one (1) year after termination of employment, I, the undersigned, will not, directly or indirectly, assist, or be part of or have any involvement in, any effort to acquire control of the Company through the acquisition of its stock or substantially all of its assets, without the prior consent of the Board of Directors of the Company. This provision shall not prevent the undersigned from owning up to not more than one percent (1%) of the outstanding publicly traded stock of any company.

5.       I further acknowledge pursuant to the Older Worker’s Benefit Protection Act (29 U.S.C. § 626(f)), I expressly agree that the following statements are true:

a.       The payment of the consideration described in Section 2 of the Separation Agreement is in addition to the standard employee benefits and anything else of value which the Company owes me in connection with my employment with the Company or the separation of employment.

b.       I have twenty-one days days from date of receipt to consider and sign this agreement. If I choose to sign this Agreement before the end of the twenty-one day period, that decision is completely voluntary and has not been forced on me by the Company.

c.       I will have seven (7) days after signing the Agreement in which to revoke it, and the Agreement will not become effective or enforceable until the end of those seven (7) days.

d.       I am now being advised in writing to consult an attorney before signing this Agreement.

I acknowledge that I have been given sufficient time to freely consult with an attorney or counselor of my own choosing and that I knowingly and voluntarily execute this Agreement, after bargaining over the terms hereof, with knowledge of the consequences made clear, and with the genuine intent to release claims without threats, duress, or coercion on the part of the Company. I do so understanding and acknowledging the significance of such waiver.

6.       Further, in view of the above-referenced consideration voluntarily provided to me by the Company, after due deliberation, I agree to waive any right to further litigation or claim against any or all of the Releasees except as specifically provided in paragraph number 2 above. I hereby agree to indemnify and hold harmless the Releasees and their respective agents or representatives from and against any and all losses, costs, damages or expenses, including, without limitation, attorneys fees incurred by said parties, or any of them, arising out of any breach of this Agreement by me or by any person acting on my behalf, or the fact that any representation made herein by the undersigned was false when made.

7.       As a material inducement to the Company to enter into this Agreement, I, the undersigned, understand and agree that if I should fail to comply with the conditions hereof or to carry out the agreement set forth herein, all amounts previously paid under this Agreement shall be immediately forfeited to the Company and that the right or claim to further payments and/or benefits hereunder would likewise be forfeited.

8.       As a further material inducement to the Company to enter into this Agreement, the undersigned provides as follows:

First. I represent that I have not filed any complaints or charges against the Company, or any of the Releasees relating to the relinquishment of my former titles and responsibilities at the Company or the terms of my employment with the Company and that if any agency or court assumes jurisdiction of any complaint or charge against the Company or any of the Releasees on behalf of me concerning my employment with the Company, I understand and agrees that I have, by my knowing and willing execution of this Agreement waived my rights to any form of recovery or relief against the Company, or any of the Releasees, including but not limited to, attorney’s fees. Provided, however, that this provision shall not preclude the undersigned from pursuing appropriate legal relief against the Company for redress of a substantial breach of a material obligation of the Company expressly undertaken in consideration of my entering into this Agreement.

Second. I acknowledge and understand that the consideration for this release shall not be in any way construed as an admission by the Company or any of the Releasees of any improper acts or any improper employment decisions, and that the Company, specifically disclaims any liability on the part of itself, the Releasees, and their respective agents, employees, representatives, successors or assigns in this regard.

Third. I acknowledge and agree that this Agreement shall be binding upon me, upon the Company, and upon our respective administrators, representatives, executives, successors, heirs and assigns and shall inure to the benefit of said parties and each of them.

Fourth. I represent, understand and agree that this Agreement sets forth the entire agreement between the parties hereto, and fully supersedes any and all prior agreements or understandings between the parties pertaining to the subject matter hereof, except for the confidentiality and non-competition agreement previously executed by me, the terms of which retain their full force and effect, and which are in no way limited or curtailed by this Agreement.

Fifth. Modification. This Agreement may not be altered or changed except by an agreement in writing that has been properly executed by the party against whom any waiver, change, modification or discharge is sought.

Sixth. Severability. All provisions and terms of this Agreement are severable. The invalidity or unenforceability of any particular provision(s) or term(s) of this Agreement shall not affect the validity or enforceability of the other provisions and such other provisions shall be enforceable in law or equity in all respects as if such particular invalid or unenforceable provision(s) or term(s) were omitted. Notwithstanding the foregoing, the language of all parts of this Agreement shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties.

Seventh. Mutual No Disparagement. The Company and undersigned affirm their respective rights and obligations pursuant to Section 9 of the Separation Agreement.

Eighth. Confidentiality. The Company and the undersigned agree to refrain from disclosing to third parties and to keep strictly confidential all details of this Agreement and any and all information relating to its negotiation, except as necessary to each party’s accountants or attorneys.

Ninth. Termination of Agreement. Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated by the Company and all further payment obligations of the Company will cease, if: (a) the undersigned is terminated for “Cause” prior to the undersigned’s separation date; or (b) facts are discovered after the undersigned’s separation date that would have supported a termination for “Cause” had such facts been discovered prior to the undersigned’s separation date.

AFFIRMATION OF RELEASOR

I, Dale G. Barnhart, warrant that I am competent to execute this Termination, Voluntary Release and Waiver of Rights Agreement and that I accept full responsibility thereof.

I, Dale G. Barnhart, warrant that I have had the opportunity to consult with an attorney of my choosing with respect to this matter and the consequences of my executing this Termination, Voluntary Release and Waiver of Rights Agreement.

I, Dale G. Barnhart, have read this Termination, Voluntary Release and Waiver of Rights Agreement carefully and I fully understand its terms. I execute this document voluntarily with full and complete knowledge of its significance.

Executed this       day of             , 2020 at                       .

Subscribed and sworn to before me, a Notary Public in and for said County and State, this day of             , 2020 under the pains and penalties of perjury.

, Notary Public

My Commission Expires:

County of Residence: