Exhibit 10.9

 

NORTHERN TECHNOLOGIES INTERNATIONAL CORPORATION

 

DESCRIPTION OF NON-EMPLOYEE DIRECTOR
COMPENSATION ARRANGEMENTS

 

Overview

 

NTIC uses a combination of cash and long-term equity-based incentive
compensation in the form of annual stock option grants to attract and retain
qualified non-employee candidates to serve on the Board of Directors.

 

Annual Retainers; Meeting Fees

 

Each non-employee director receives an annual retainer of $15,000 for services
rendered as a director of NTIC. The annual retainer is paid quarterly. NTIC’s
Chairman of the Board receives an additional annual retainer of $15,000, the
Chair of the Audit Committee receives an additional annual retainer of $5,000
and other members of the Audit Committee received an additional annual retainer
of $4,000. Each non-employee director also receives $1,000 for each Board and
strategy review meeting attended and $1,000 for each Audit Committee,
Compensation Committee and Nominating and Corporate Governance Committee meeting
attended. No director, however, will earn more than $1,000 per day in Board,
Board committee and strategy review meeting fees. Any director that is an
employee of NTIC does not receive any retainer or Board or Committee meeting
fees.

 

Stock Options

 

Each non-employee director is automatically granted a ten-year non-qualified
option to purchase 4,000 shares of NTIC common stock in consideration for their
services as directors of NTIC and the Chairman of the Board is automatically
granted an additional ten-year non-qualified option to purchase 2,000 shares of
NTIC common stock in consideration for his services as Chairman on the first day
of each fiscal year. Each non-employee directors who is elected or appointed to
the Board following the first day of the fiscal year receives an automatic grant
of an option to purchase a pro rata portion of 4,000 shares of NTIC common stock
calculated by dividing the number of months remaining in the fiscal year at the
time of election or appointment divided by 12, which options are automatically
granted at the time of the new director’s election or appointment. Each
automatically granted option becomes exercisable, in full on the one-year
anniversary of the date of its grant. The exercise price of such option is equal
to the fair market value of a share of NTIC common stock on the date of grant.
All such options are granted under the Northern Technologies International
Corporation Amended and Restated 2007 Stock Incentive Plan.

 

Reimbursement of Expenses

 

All directors of NTIC are reimbursed for travel expenses for attending meetings
and other miscellaneous out-of-pocket expenses incurred in performing their
Board functions.