Document:

<PAGE>

                                                                  Exhibit 10.15

                              EMPLOYMENT AGREEMENT

            THIS AGREEMENT is made and entered into as of the 1st day of March,
2000, by and between LYDALL, INC., a Delaware corporation (the "Company"), and
CHRISTOPHER R. SKOMOROWSKI (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;

            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; Termination of Prior Agreement.

            (a) The Company agrees to continue to employ the Executive, and the
Executive agrees to remain in the employment of the Company, in accordance with
the terms and provisions of this Agreement.

            (b) The Employment Period under this Agreement shall be the period
commencing as of the date of this Agreement and ending on the date of
termination of the Executive's employment pursuant to Section 5, 6 or 7 below,
whichever is applicable.

            (c) Immediately upon the commencement of the Executive's employment
pursuant to the terms of this Agreement, that certain Agreements by and between
the Executive and the Company dated as of February 1, 2000 and February 1, 1999
shall terminate and shall be of no further force or effect.

            2. Duties. It is the intention of the Parties that during the term
of his employment under this Agreement, the Executive will serve as Chief
Executive Officer of the Company. During the Employment Period, the Executive
will devote his full business time and attention and best efforts to the affairs
of the Company and his duties as its Chief Executive Officer. The Executive will
have such duties as are appropriate to his position as Chief Executive Officer,
and will have such

<PAGE>
                                      -2-

authority as required to enable him to perform these duties. Consistent with the
foregoing, the Executive shall comply with all reasonable instructions of the
Board of Directors of the Company (the "Board").

            3. Compensation and Benefits.

            3.1 Salary. During the Employment Period, the Company will pay the
Executive a base salary at an initial annual rate of Three Hundred Fifty
Thousand Dollars ($350,000). The Board 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 Board. The Executive's base salary may not be decreased during the term of
this Agreement. The Chairman of the Board of the Company shall meet with the
Executive annually to review the Executive's performance, objectives and
compensation, including salary, bonus and stock options, and the Chairman of the
Board shall then meet with the Compensation and Stock Option Committee of the
Board (the "Compensation Committee") to discuss the same. If the Compensation
Committee determines that any adjustments thereto are appropriate, such
committee shall make a recommendation to the full Board and the Board shall make
such adjustments, if any, as the Board deems appropriate and consistent with
this Agreement. The Executive's base salary will be paid in accordance with the
standard practices for other corporate executives of the Company.

            3.2 Bonuses. During the Employment Period, the Executive will be
eligible to receive annually or otherwise such bonus awards, if any, as shall be
determined by the Board in its sole and absolute discretion after receiving the
recommendation of the Compensation Committee.

            3.3 Benefit Programs. During the Employment Period, the Executive
will be entitled to participate on substantially the same terms as other senior
executives of the Company in all employee benefit plans and programs of the
Company from time to time in effect for the benefit of senior executives of the
Company, including, but not limited to, pension and other retirement plans,
profit sharing plans, stock incentive and individual performance award plans,
group life insurance, hospitalization and surgical and major medical coverages
(exluding the Lydall, Inc. Executive Medical Plan), short-term and long-term
disability, and such other benefits as are or may be made available from time to
time to senior executives of the Company.

<PAGE>
                                      -3-

            3.4 Vacations and Holidays. During the Employment Period, the
Executive will be entitled to vacation leave of five (5) 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 executives. The Executive will be
entitled to such holidays as are established by the Company for all employees.

            3.5 Automobile. During the Employment Period, the Company will
provide the Executive with an automobile allowance of no less than $500 per
month.

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

            5. Termination of Employment by the Company.

            5.1 Involuntary Termination by the Company Other Than For Permanent
and Total Disability, Cause, or Following Change of Control. The Company may
terminate the Executive's employment at any time other than (i) by reason of the
Executive's Permanent and Total Disability (as defined in Section 5.2) or (ii)
for Cause (as defined in Section 5.3), by giving him 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 12 months following a "Change of Control" (as
defined in Section 10), or (ii) the benefits described in Section 9 if such
termination of employment occurs within 12 months following a "Change of
Control" (as defined in Section 10).

            5.2 Termination Due to Permanent and Total Disability. If the
Executive incurs a Permanent and Total Disability, as defined below, the Company
may terminate the Executive's employment by giving him 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 Permanent and Total Disability, the
Executive shall be entitled to receive (i) his base salary pursuant to Section
3.1 through the date which is twenty-four months following the date of such
termination of employment, reduced by any amounts paid to the

<PAGE>
                                      -4-

Executive under any disability program maintained by the Company, such base
salary to be paid at the normal time for the payment of such base salary, (ii) a
bonus for the year of termination of employment and for the next succeeding year
(to be paid at the normal time for payment of such bonuses) in an amount equal
to the average of the three highest annual bonuses earned by the Executive under
the Company's annual incentive bonus plan for any of the five calendar years
preceding the calendar year of his termination of employment (or, if he was not
eligible for a bonus for at least three calendar 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 he was eligible), with any deferred bonuses counting for the
year earned rather than the year paid; (iii) 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, and (iv) any reimbursement amounts owing under
Section 4. In addition, if the Executive elects to continue coverage under the
Company's health plan pursuant to COBRA, the Company for a period of eighteen
months following termination of the Executive's employment by reason of
Permanent and Total Disability will pay the same percentage of the Executive's
premium for COBRA coverage for the Executive and, if applicable, his spouse and
dependent children, as the Company paid at the applicable time for coverage
under such plan for actively employed senior executives generally. For the
period of eighteen months following the termination of the Executive's
employment by reason of Permanent and Total Disability, 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 senior executives of the Company generally
are required to pay for such coverage. For purposes of this Agreement, the
Executive shall be considered to have incurred a Permanent and Total Disability
if he is unable to substantially carry out his duties under this Agreement by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or which has lasted or can be expected to last for a
continuous period of not less than 12 months. The existence of such Permanent
and Total Disability shall be evidenced by such medical certification as the
Secretary of the Company shall require and shall be subject to the approval of
the Compensation Committee.

<PAGE>
                                      -5-

            5.3 Termination for Cause. The Company may terminate the Executive's
employment immediately for Cause for any of the following reasons: (i) an act or
acts of dishonesty or fraud on the part of the Executive resulting or intended
to result directly or indirectly in substantial gain or personal enrichment to
which the Executive was not legally entitled at the expense of the Company; (ii)
a willful material breach by the Executive of his duties or responsibilities
under this Agreement resulting in demonstrably material injury to the Company;
(iii) the Executive's conviction of a felony or any crime involving moral
turpitude, (iv) habitual neglect 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 neglect or insubordination and the Executive has failed to
cure such conduct, where susceptible to cure, within thirty days following such
notice, or (v) a material breach by the Executive of any of his obligations
under the Lydall Employee Agreement executed by the Executive and attached
hereto as Exhibit A. Notwithstanding the foregoing, the Executive shall not be
deemed to have been terminated for Cause unless and until there shall have been
delivered to the Executive a written notice of termination from the Compensation
Committee after reasonable notice to the Executive and an opportunity for the
Executive, together with his counsel, to be heard before the Compensation
Committee, finding that, in the good faith opinion of the Compensation
Committee, the Executive was guilty of conduct set forth above in clause (i),
(ii), (iii), (iv) or (v) of the first sentence of this Section 5.3 and
specifying the particulars in detail. In the event of such termination of the
Executive's employment for Cause, the Executive shall be entitled to receive
only (i) his base salary pursuant to Section 3.1 earned through the date of such
termination of employment plus his 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 at the normal time for payment of such base salary, (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 and at the
normal time for payment of such compensation and benefits and (iii) any
reimbursement amounts owing under Section 4.

            6. Termination of Employment by the Executive.

            (a) Good Reason. The Executive may terminate his employment for Good
Reason by giving the Company a written no-

<PAGE>
                                      -6-

tice 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 his employment for Good Reason, the Executive shall
be entitled to receive (i) the benefits described in Section 8 if such
termination of employment does not occur within 12 months following a "Change of
Control" (as defined in Section 10), or (ii) the benefits described in Section 9
if such termination of employment occurs within 12 months following a "Change of
Control" (as defined in Section 10). For purposes of this Agreement, Good Reason
shall mean (i) a significant reduction in the scope of the Executive's
authority, functions, duties or responsibilities from that which is contemplated
by this Agreement, (ii) any reduction in the Executive's base salary, (iii) a
significant reduction in the employee benefits provided to the Executive
(excluding the Lydall, Inc. Executive Medical Plan) other than in connection
with an across-the-board reduction similarly affecting substantially all senior
executives of the Company, or (iv) 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 Lydall Employee
Agreement, which breach is not cured within thirty days following written notice
thereof to the Company of such breach. In addition, in the case of a termination
of employment within 12 months following a "Change of Control" (as defined in
Section 10), Good Reason shall also include 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. If an event constituting a ground for
termination of employment for Good Reason occurs, and the Executive fails to
give notice of termination within 90 days after the occurrence of such event,
the Executive shall be deemed to have waived his right to terminate employment
for Good Reason in connection with such event (but not for any other event for
which the 90-day period has not expired).

            (b) Other. The Executive may terminate his 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). In the event of the Executive's termination of his employment pursuant to
this subsection (b), the Executive shall be entitled to receive only (i) his
base salary pursuant to Section 3.1 earned through the date of such termination
of employment plus his base salary for the period of vacation time

<PAGE>
                                      -7-

earned but not taken for the year of termination of employment, such base salary
to be paid at the normal time for payment of such base salary, (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, 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 his 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 (i) 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 at the normal time for payment of such base salary, (ii) 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 incentive bonus plan for any of the five calendar years preceding the
calendar year of the Executive's death (or, if the Executive was not eligible
for a bonus for at least three calendar 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), 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 his death by 365 (366 if a leap year),(iii) 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, and (iv) 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 18 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,

<PAGE>
                                      -8-

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 with the Company shall
terminate (i) because of termination by the Company other than for Cause or
Permanent and Total Disability 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 within 12 months following a
"Change of Control" of the Company (as defined in Section 10), the Executive
shall be entitled to the following:

            (a) The Company shall pay to the Executive his base salary pursuant
      to Section 3.1 earned through the date of such termination of employment
      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, such base salary, compensation and
      benefit to be paid at the normal time for payment of such base salary,
      compensation and benefits.

            (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) his annual rate of base
      salary immediately preceding his termination of employment, and (ii) the
      average of his annual bonuses earned under the Company's annual incentive
      bonus plan for the three calendar years preceding his termination of
      employment (or, if he was not eligible for a bonus in each of those three
      calendar years, then the average of such bonuses for all of the calendar
      years in such three-year period for which he was eligible), with any
      deferred bonuses counting for the year earned rather than the year paid.
      Such severance benefit shall be paid in a lump sum within 30 days after
      the date of such termination of employment.

            (d) During the period of 18 months beginning on the date of the
      Executive's termination of employment, 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

<PAGE>
                                      -9-

      available through nationally reputable insurance carriers, long-term
      disability plans of the Company that covered him immediately prior to his
      termination of employment as if he 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 his spouse or
      dependent children) of the portion of the premium for such coverage that
      actively employed senior executives with 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, his spouse and dependent
      children) with substantially similar benefits (but, in the case of
      long-term disability benefits, only if reasonably commercially available).

            (e) The Company shall supplement the benefits payable in respect of
      the Executive under the Company's Pension Plan and Supplemental Executive
      Retirement Plan (and any successor plans thereto) (collectively, the
      "Pension Plans") by paying the difference between (i) the benefits that
      the Executive would have been entitled to receive under the Pension Plans
      if he had been credited with one and one-half additional years of service
      (but no additional years of age) for purposes of the benefit accrual
      formula under the Pension Plans as of the date of termination of the
      Executive's employment and (ii) the benefits that the Executive is
      entitled to receive under the Pension Plans determined without regard to
      this subsection (e). Such benefits shall be payable in the same form and
      at the same time as the benefits under the respective Pension Plans.

            (f) The Company will pay the Executive a car allowance of $500 per
      month for 24 months following termination of the Executive's employment to
      replace the Company-leased automobile, which leased automobile will be
      returned to the Company by the Executive on the date of termination of the
      Executive's employment.

            (g) The Company will provide the Executive with out-placement
      services (which may include secretarial services and office space,
      equipment and supplies) selected by the Executive, at the Company's
      expense, up to a maximum of $20,000.

            (h) The Executive shall be entitled to the Gross-up Payment, if any,
      described in Section 11.

<PAGE>
                                      -10-

            (i) 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 Agreement or to defend against any
      claim or assertion in connection with this Agreement, but only to the
      extent the Executive substantially prevails.

            9. Benefits Upon Termination Without Cause or For Good Reason
(Change of Control). If (a) the Executive's employment with the Company shall
terminate (i) because of termination by the Company other than for Cause or
Permanent and Total Disability 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 within 12 months following a "Change of
Control" of the Company (as defined in Section 10), the Executive shall be
entitled to the following:

            (a) The Company shall pay to the Executive his base salary pursuant
      to Section 3.1 earned through the date of such termination of employment
      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, such base salary, compensation and
      benefits to be paid at the normal time for payment of such base salary,
      compensation and benefits.

            (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 three (3) times the sum of (i) his annual rate of base
      salary immediately preceding his termination of employment, and (ii) the
      average of his three highest annual bonuses earned under the Company's
      annual incentive bonus plan for any of the five calendar years preceding
      his termination of employment (or, if he was not eligible for a bonus for
      at least three calendar 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 he was eligible), with any deferred bonuses counting for the year
      earned rather than the year paid. Such severance benefit shall be paid in
      a lump sum within 30 days after the date of such termination of
      employment.

<PAGE>
                                      -11-

            (d) The Company shall pay to the Executive as a bonus for the year
      of termination of his employment an amount equal to a portion (determined
      as provided in the next sentence) of the Executive's maximum bonus
      opportunity under the Company's annual incentive bonus plan for the
      calendar year of termination of the Executive's employment or, if none,
      such portion of the bonus awarded to him under the Company's annual
      incentive bonus plan for the calendar year immediately preceding the
      calendar year of the termination of his 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 his 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.

            (e) During the period of 36 months beginning on the date of the
      Executive's termination of employment, 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 him immediately prior to his termination
      of employment as if he 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 his spouse or dependent children)
      of the portion of the premium for such coverage that actively employed
      senior executives with 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, his spouse and dependent children) with substantially similar
      benefits (but, in the case of long-term disability benefits, only if
      reasonably commercially available).

            (f) The Company shall supplement the benefits payable in respect of
      the Executive under the Company's Pension Plan and Supplemental Executive
      Retirement Plan (and any successor plans thereto) (collectively, the
      "Pension Plans") by paying the difference between (i) the benefits that
      the Executive would have been entitled to receive under the Pension Plans
      if he had been credited with three additional years of service (but no
      additional years of

<PAGE>
                                      -12-

      age) for purposes of the benefit accrual formula under the Pension Plans
      as of the date of termination of the Executive's employment and (ii) the
      benefits that the Executive is entitled to receive under the Pension Plans
      determined without regard to this subsection (f). Such benefits shall be
      payable in the same form and at the same time as the benefits under the
      respective Pension Plans.

            (g) Each stock option granted by the Company to the Executive and
      outstanding immediately prior to termination of his employment shall be
      fully vested and immediately exercisable and may be exercised by the
      Executive (or, following his 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 his employment).
      Each restricted stock 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.

            (h) The Company will pay the Executive a car allowance of $500 per
      month for 36 months following termination of the Executive's employment to
      replace the Company-leased automobile, which leased automobile will be
      returned to the Company by the Executive on the date of termination of the
      Executive's employment.

            (i) The Company will provide the Executive with out-placement
      services (which may include secretarial services and office space,
      equipment and supplies) selected by the Executive, at the Company's
      expense, up to a maximum of $20,000.

            (j) The Executive shall be entitled to the Gross-up Payment, if any,
      described in Section 11.

            (k) 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 Agreement or to defend against any
      claim or assertion in connection with this Agreement, but only to the
      extent the Executive substantially prevails.

            10. Change of Control. For the purposes of this Agreement, a "Change
of Control" shall be deemed to have occurred if (a) any person or persons acting
together which would

<PAGE>
                                      -13-

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) the shareholders of
the Company approve (i) a plan of complete liquidation of the Company or (ii) an
agreement providing for 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; or (d) the shareholders of the Company
approve an agreement (or agreements) providing for the sale or other disposition
(in one transaction or a series of transactions) of all or substantially all of
the assets of the Company.

            11. Tax Gross-up.

            (a) In the event that any payment or distribution made, or benefit
provided, by the Company or any of its affiliates to or for the benefit of the
Executive (whether paid or payable or distributed or distributable) pursuant to
the terms of this Agreement or any other plan, program or arrangement of the
Company or any of its affiliates but determined without regard to any additional
payments required under this Section 11 (collectively the "Payments") would be
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended and then in effect (the "Code") (or any similar excise tax)
or any interest or penalties are incurred by the Executive with respect to such
excise tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the

<PAGE>
                                      -14-

Executive of all Federal, state, local or other taxes (including any interest or
penalties imposed with respect to any such taxes), including, without
limitation, any such income taxes (and any interest and penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments. The Executive may receive Gross-Up Payments under this Section 11
whether or not the Executive actually receives other payments or benefits under
this Agreement.

            (b) Subject to the provisions of subsection (c) of this Section 11,
all determinations required to be made under this Section 11, including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up Payment
and the assumptions to be utilized in arriving at such determination, 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 both to the Company and the Executive within 20
calendar days of the receipt of written notice from the Executive that there has
been a Payment, or such earlier time as is requested by the Company. 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. Any Gross-Up Payment, as determined pursuant to this
Section 11, shall be paid by the Company to the Executive within five days of
the receipt of the Accounting Firm's determination. If the Accounting Firm
determines that no Excise Tax is payable by the Executive, it shall furnish the
Executive with an unqualified written opinion in form and substance satisfactory
to the Executive that failure to report the Excise Tax on the Executive's
applicable federal income tax return would not result in the imposition of a
negligence or similar penalty. As a result of the uncertainty in the application
of Section 4999 of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event that the
Company exhausts its remedies described in subsection (c) of this Section 11 and
the Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be paid by the Company to or for the benefit of
the Executive within five days of the receipt of the Accounting Firm's
determination. All determinations made by the Accounting Firm in connection with
any Gross-

<PAGE>
                                      -15-

Up Payment or Underpayment shall be final and binding upon the Company and the
Executive.

            (c) The Executive shall notify the Company in writing of any claim
asserted in writing by the Internal Revenue Service to the Executive that, if
successful, would require the payment by the Company of the Gross-Up Payment.
Such notification shall be given as soon as practicable but not later than 60
days after the Executive is informed in writing of such claim and shall apprise
the Company of the nature of such claim and the date on which such claim is
requested to be paid. The Executive shall not pay such claim prior to the
expiration of the 30-day period following the date on which it gives such notice
to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the Executive
in writing prior to the expiration of such period that it desires to contest
such claim, the Executive shall at the Company's expense:

            (i) give the Company any information reasonably requested by the
      Company relating to such claim,

            (ii) take such action in connection with contesting such claim as
      the Company shall reasonably request in writing from time to time,
      including, without limitation, accepting legal representation with respect
      to such claim by an attorney reasonably selected by the Company,

            (iii) cooperate with the Company in good faith in order effectively
      to contest such claim, and

            (iv) permit the Company to participate in any proceedings relating
      to such claim; provided, however, that the Company shall bear and pay
      directly as incurred all costs and expenses (including additional interest
      and penalties) incurred in connection with such contest and shall
      indemnify and hold the Executive harmless, on an after-tax basis, for any
      Excise Tax or any Federal, state, local or other income or other tax
      (including interest and penalties with respect thereto) imposed as a
      result of such representation and payment of costs and expenses. Without
      limitation on the foregoing provisions of this Section 11, the Company
      shall control all proceedings taken in connection with such contest and,
      at its sole option, may pursue or forego any and all administrative
      appeals, proceedings, hearings and conferences with the taxing authority
      in respect of such claim and may, at its sole option, either direct the
      Executive to pay the tax claimed and sue for a

<PAGE>
                                      -16-

      refund or contest the claim in any permissible manner, and the Executive
      agrees to prosecute such contest to a determination before any
      administrative tribunal, in a court of initial jurisdiction and in one or
      more appellate courts, as the Company shall determine; provided, however,
      that if the Company directs the Executive to pay such claim and sue for a
      refund, the Company shall advance the amount of such payment to the
      Executive on an interest-free basis and shall indemnify and hold the
      Executive harmless, on an after-tax basis, from any Excise Tax or Federal,
      state, local or other income or other tax (including interest or penalties
      with respect thereto) imposed with respect to such advance or with respect
      to any imputed income with respect to such advance; and further provided
      that any extension of the statute of limitations relating to payment of
      taxes for the taxable year of the Executive with respect to which such
      contested amount is claimed to be due is limited solely to such contested
      amount. Furthermore, the Company's control of the contest shall be limited
      to issues with respect to which a Gross-Up Payment would be payable
      hereunder and the Executive shall be entitled to settle or contest, as the
      case may be, any other issue raised by the Internal Revenue Service or any
      other taxing authority.

            (d) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to subsection (c) of this Section 11, the Executive becomes
entitled to receive any refund with respect to such claim, the Executive shall
(subject to the Company's complying with the requirements of subsection (c) of
this Section 11) promptly pay to the Company the amount of such refund (together
with any interest paid or credited thereon after taxes applicable thereto) upon
receipt thereof. If, after the receipt by the Executive of an amount advanced by
the Company pursuant to subsection (c) of this Section 11, a determination is
made that the Executive shall not be entitled to any refund with respect to such
claim and the Company does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

            12. 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

<PAGE>
                                      -17-

the Executive or his spouse, dependents or beneficiaries may have pursuant to
any other plan or program of the Company.

            13. Indemnification. The parties agree to execute a separate
Indemnification Agreement in the form attached as Exhibit B.

            14. General Provisions.

            14.1 No Duty to Seek Employment. The Executive shall not be under
any duty or obligation to seek or accept other employment following termination
of employment, and no amount, payment or benefits due to the Executive hereunder
shall be reduced or suspended if the Executive accepts subsequent employment,
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 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 may be personally served or may be faxed with a copy deposited in the United
States mail, registered or certified, return receipt requested, postage prepaid,
addressed as follows:

      To the Company:         Lydall, Inc.
                              P.O. Box 151
                              One Colonial Road
                              Manchester, CT 06045-0151
                              Attn: Chairman of the Board

      To the Executive:       Christopher R. Skomorowski
                              48 Highwood Road
                              Simsbury, CT 06070

or such other address as such party shall have specified most recently by
written notice. Notice mailed as provided herein shall be deemed given on the
fifth business day following the date so mailed or on the date of actual
receipt, whichever is earlier.

            14.4 No Disparagement. The Executive shall not during the period of
his employment with the Company, nor during

<PAGE>
                                      -18-

the two-year period beginning on the date of termination of his employment for
any reason, disparage the Company or any of its subsidiaries or affiliates or
any of their shareholders, directors, officers, employees or agents. The
Executive agrees 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 Proprietary Information and Inventions. The Lydall Employee
Agreement previously executed by the Executive and attached hereto as Exhibit A
is incorporated by reference in this Agreement, and the Executive agrees to
continue to be bound thereby.

            14.6 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 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. The
Executive understands that the Executive is precluded from filing a complaint
with any governmental agency or court having jurisdiction over wrongful conduct
unless the Executive has first notified the Company of the facts and permits it
to investigate and correct the concerns.

            14.7 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.

            14.8 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 him hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to the Ex-

<PAGE>
                                      -19-

ecutive's devisee, legatee, or other designee or, if there be no such designee,
to the Executive's estate.

            14.9 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.

            14.10 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 14.10, 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.

            14.11 Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Connecticut.

            14.12 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 relating to this Agreement or the
terms or conditions of Executive's employment by the Company. 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.

            14.13 Right to Injunctive and Equitable Relief. The Executive's
obligations under Section 14.4 are of a special and unique character, which
gives them a peculiar value. The Company cannot be reasonably or adequately
compensated for damages in an action at law in the event the Executive breaches
such obligations. Therefore, the Executive expressly agrees that the Company
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 Company may possess or be entitled to pursue. Furthermore,

<PAGE>
                                      -20-

the obligations of the Executive and the rights and remedies of the Company
under Section 14.4 and this Section 14.13 are cumulative and in addition to, and
not in lieu of, any obligations, rights, or remedies as created by applicable
law.

            14.14 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.

            14.15 Entire Agreement. This Agreement, along with the Lydall
Employee Agreement by and between the Executive and the Company, constitutes 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 Lydall Employee 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 Lydall Employee 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.

            14.16 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed an original but all
of which together shall constitute one and the same instrument.

<PAGE>
                                      -21-

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

            LYDALL, INC.

            By:
               ------------------------------         -----------
               Roger M. Widmann                       Date
               Chairman of the Board

               ------------------------------         -----------
               Christopher R. Skomorowski             Date<PAGE>

                                                                 Exhibit 10.16

                              EMPLOYMENT AGREEMENT

            THIS AGREEMENT is made and entered into as of the 16th day of March,
2000, by and between LYDALL, INC., a Delaware corporation (the "Company"), and
Walter A. Ruschmeyer (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; Termination of Prior Agreement.

            (a) The Company and/or one of its subsidiaries agrees to continue to
employ the Executive, and the Executive agrees to remain in the employment of
the Company and/or one of its subsidiaries, in accordance with the terms and
provisions of this Agreement.

            (b) The Employment Period under this Agreement shall be the period
commencing as of the date of this Agreement 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. It is the intention of the Parties that during the term
of the Executive's employment under this Agreement, the Executive will serve as
Executive Vice President - Finance and Administration, Chief Financial Officer
of the Company or in such other senior management position as the Company shall
determine. During the Employment Period, the Executive will devote his full
business time and attention and best efforts to the affairs of the Company and
its subsidiaries and his duties as Executive Vice President - Finance and
Administration, Chief Financial Officer of the Company. The Executive will have
such duties as are appropriate to his position as Executive Vice President -
Finance and Administration, Chief Financial Officer of the Company, and will
have such authority

<PAGE>
                                      -2-

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 of Directors of the Company (the "Board").

            3. Compensation and Benefits.

            3.1 Salary. During the Employment Period, the Company will pay the
Executive a base salary at an initial annual rate of Three Hundred Twenty-Five
Thousand Dollars ($325,000). 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. The Executive's base salary may not be decreased during
the term of this Agreement. The Chief Executive Officer of the Company shall
meet with the Executive annually to review the Executive's performance,
objectives and compensation, including salary, bonus and stock options, and the
Chief Executive Officer shall then meet with the Compensation and Stock Option
Committee of the Board (the "Compensation Committee") to discuss the same. If
the Compensation Committee determines that any adjustments thereto are
appropriate, such committee shall make a recommendation to the full Board and
the Board shall make such adjustments, if any, as the Board deems appropriate
and consistent with this Agreement. The Executive's base salary will be paid in
accordance with the standard practices for other corporate executives of the
Company.

            3.2 Bonuses. During the Employment Period, the Executive will be
eligible to receive annually or otherwise such bonus awards, if any, as shall be
determined by the Board in its sole and absolute discretion after receiving the
recommendation of the Compensation Committee.

            3.3 Benefit Programs. During the Employment Period, the Executive
will be entitled to participate on substantially the same terms as other senior
executives of the Company in all employee benefit plans and programs of the
Company (subject to any restrictions or eligibility requirements under such
plans and programs) from time to time in effect for the benefit of senior
executives of the Company, including, but not limited to, pension and other
retirement plans, profit sharing plans, stock incentive and annual incentive
bonus plans, hospitalization and surgical and major medical coverages (excluding
the Lydall, Inc. Executive Medical Plan), short-term and executive long-term
disability, executive life insurance and Supplemental Executive Retirement Plan
and such other benefits as are or may

<PAGE>
                                      -3-

be made available from time to time to senior executives of the Company.

            3.4 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 executives. The Executive will be
entitled to such holidays as are established by the Company for all employees.

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

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

            5. Termination of Employment by the Company.

            5.1 Involuntary Termination by the Company Other Than For Permanent
and Total Disability or Cause. The Company may terminate the Executive's
employment at any time other than (i) by reason of the Executive's Permanent and
Total Disability (as defined in Section 5.2) or (ii) 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 12 months following a "Change of Control" (as defined in Section 10), or
(ii) the benefits described in Section 9 if such termination of employment
occurs within 12 months following a "Change of Control" (as defined in Section
10).

            5.2 Termination Due to Permanent and Total Disability. If the
Executive incurs a Permanent and Total 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

<PAGE>
                                      -4-

of Permanent and Total Disability, the Executive shall be entitled to receive
(i) his base salary pursuant to Section 3.1 through the date which is twelve
months following 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 to be paid at the normal time for the payment of such
base salary, (ii) a bonus for the year of termination of employment and for the
next succeeding year (to be paid at the normal time for payment of such bonuses)
in an amount equal to the average of the three highest annual bonuses earned by
the Executive under the Company's annual incentive bonus plan for any of the
five calendar years preceding the calendar year of his termination of employment
(or, if the Executive was not eligible for a bonus for at least three calendar
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),
with any deferred bonuses counting for the year earned rather than the year
paid; (iii) 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, and (iv)
any reimbursement amounts owing under Section 4. In addition, if the Executive
elects to continue coverage under the Company's health plan pursuant to COBRA,
the Company for a period of twelve months following termination of the
Executive's employment by reason of Permanent and Total Disability will pay the
same percentage of the Executive's premium for COBRA coverage for the Executive
and, if applicable, his spouse and dependent children, as the Company paid at
the applicable time for coverage under such plan for actively employed senior
executives generally. For the period of twelve months following the termination
of the Executive's employment by reason of Permanent and Total Disability, 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 senior executives of the
Company generally are required to pay for such coverage, if any. For purposes of
this Agreement, the Executive shall be considered to have incurred a Permanent
and Total Disability if and only if the Executive has incurred a disability
entitling the Executive to disability benefits under the Company's long-term
disability plan.

            5.3 Termination for Cause. The Company may terminate the Executive's
employment immediately for Cause for any

<PAGE>
                                      -5-

of the following reasons: (i) an act or acts of dishonesty or fraud on the part
of the Executive resulting or intended to result directly or indirectly in
substantial gain or personal enrichment to which the Executive was not legally
entitled at the expense of the Company or any of its subsidiaries; (ii) a
willful material breach by the Executive of his duties or responsibilities under
this Agreement resulting in demonstrably material injury to the Company or any
of its subsidiaries; (iii) the Executive's conviction of a felony or any crime
involving moral turpitude, (iv) habitual neglect 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 neglect or insubordination and the Executive has
failed to cure such conduct, where susceptible to cure, within thirty days
following such notice, or (v) a material breach by the Executive of any of his
obligations under the Lydall Employee Agreement executed by the Executive and
attached hereto as Exhibit A. 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) his base salary pursuant to
Section 3.1 earned through the date of such termination of employment plus his
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 at the normal
time for payment of such base salary, (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 and at the normal time for payment of such
compensation and benefits and (iii) any reimbursement amounts owing under
Section 4.

            6. Termination of Employment by the Executive.

            (a) Good Reason. The Executive may terminate his 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 his employment
for Good Reason, the Executive shall be entitled to receive (i) the benefits
described in Section 8 if such termination of employment does not occur within
12 months following a "Change of Control" (as defined in Sec-

<PAGE>
                                      -6-

tion 10), or (ii) the benefits described in Section 9 if such termination of
employment occurs within 12 months following a "Change of Control" (as defined
in Section 10). For purposes of this Agreement, Good Reason shall mean (i) a
significant reduction in the scope of the Executive's authority, functions,
duties or responsibilities from that which is contemplated by this Agreement,
(ii) any reduction in the Executive's base salary, (iii) a significant reduction
in the employee benefits provided to the Executive (excluding the Lydall, Inc.
Executive Medical Plan) other than in connection with an across-the-board
reduction similarly affecting substantially all senior executives of the
Company, or (iv) 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 Lydall Employee Agreement which
breach is not cured within thirty days following written notice thereof to the
Company of such breach. In addition, in the case of a termination of employment
within 12 months following a "Change of Control" (as defined in Section 10),
Good Reason shall also include 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. If an event constituting a ground for termination
of employment for Good Reason occurs, and the Executive fails to give notice of
termination within 90 days after the occurrence of such event, the Executive
shall be deemed to have waived his right to terminate employment for Good Reason
in connection with such event (but not for any other event for which the 90-day
period has not expired).

            (b) Other. The Executive may terminate his 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 his employment pursuant to this subsection (b), the Executive
shall be entitled to receive only (i) his base salary pursuant to Section 3.1
earned through the date of such termination of employment plus his 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 at the normal time for payment of
such base salary, (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

<PAGE>
                                      -7-

of such termination of employment, such compensation and benefits to be paid at
the normal time for payment of such compensation and benefits, 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 his 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 (i) 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 at the normal time for payment of such base salary, (ii) 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 incentive bonus plan for any of the five calendar years preceding the
calendar year of the Executive's death (or, if the Executive was not eligible
for a bonus for at least three calendar 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), 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 his death by 365 (366 if a leap year), (iii) 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, and (iv) 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.

<PAGE>
                                      -8-

            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 other than for Cause or Permanent and
Total Disability 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 within 12 months following a "Change of Control" of
the Company (as defined in Section 10), the Executive shall be entitled to the
following:

            (a) The Company shall pay to the Executive his base salary pursuant
      to Section 3.1 earned through the date of such termination of employment
      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, such base salary, compensation and
      benefits to be paid at the normal time for payment of such base salary,
      compensation and benefits.

            (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 immediately
      preceding his termination of employment, and (ii) the average of his
      annual bonuses earned under the Company's annual incentive bonus plan for
      the three calendar years preceding his termination of employment (or, if
      the Executive was not eligible for a bonus in each of those three calendar
      years, then the average of such bonuses for all of the calendar years in
      such three-year period for which he was eligible), with any deferred
      bonuses counting for the year earned rather than the year paid. Such
      installments shall be paid at the times that salary payments are normally
      made by the Company.

            (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 date which is 12 months after the date of such termination of
      employment or (ii) the date on which the Executive commences substantially
      full-time employment as an employee

<PAGE>
                                      -9-

      of an employer that offers health benefits, the Company will pay the same
      percentage of the Executive's premium for COBRA coverage for the Executive
      and, if applicable, his spouse and dependent children, as the Company paid
      at the applicable time for coverage under such plan for actively employed
      senior executives generally. In addition, for the period beginning on the
      date of the Executive's termination of employment and ending on the
      earlier of (i) the date which is 12 months after the date of such
      termination of employment or (ii) the date on which the Executive
      commences substantially full-time employment as an employee of an employer
      that offers life insurance benefits, 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 senior executives of the Company generally
      are required to pay for such coverage, if any. The Executive shall notify
      the Company promptly if he, while eligible for benefits under this
      subsection (d), commences substantially full-time employment as an
      employee of an employer that offers health and/or life insurance benefits.

            (e) The Company will provide the Executive with outplacement
      services selected by the Executive, at the Company's expense not to exceed
      $10,000.

            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 other than for Cause or Permanent and
Total Disability 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 within 12 months following a "Change of Control" of the
Company (as defined in Section 10), the Executive shall be entitled to the
following:

            (a) The Company shall pay to the Executive his base salary pursuant
      to Section 3.1 earned through the date of such termination of employment
      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, such base salary, compensation and
      benefits to be paid at the normal time for payment of such base salary,
      compensation and benefits.

<PAGE>
                                      -10-

            (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) his annual rate of base
      salary immediately preceding his termination of employment, and (ii) the
      average of his three highest annual bonuses earned under the Company's
      annual incentive bonus plan for any of the five calendar years preceding
      his termination of employment (or, if the Executive was not eligible for a
      bonus for at least three calendar 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), with any deferred bonuses
      counting for the year earned rather than the year paid. Such severance
      benefit shall be paid in a lump sum within 30 days after the date of such
      termination of employment.

            (d) The Company shall pay to the Executive as a bonus for the year
      of termination of his employment an amount equal to a portion (determined
      as provided in the next sentence) of the Executive's maximum bonus
      opportunity under the Company's annual incentive bonus plan for the
      calendar 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 incentive bonus plan for the calendar year immediately preceding
      the calendar year of the termination of his 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 his 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.

            (e) During the period of 24 months beginning on the date of the
      Executive's termination of employment, 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 his
      termination of employment as if the Executive had remained in employment
      for such period; provided, however, that the coverage under

<PAGE>
                                      -11-

      any such plan is conditioned on the timely payment by the Executive (or
      his spouse or dependent children) of the portion of the premium for such
      coverage that actively employed senior executives with 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, his spouse and
      dependent children) with substantially similar benefits (but, in the case
      of long-term disability benefits, only if reasonably commercially
      available).

            (f) The Company shall supplement the benefits payable in respect of
      the Executive under the Company's Pension Plan and Supplemental Executive
      Retirement Plan (and any successor plans thereto) (collectively, the
      "Pension Plans") by paying the difference between (i) the benefits that
      the Executive would have been entitled to receive under the Pension Plans
      if he had been credited with two additional years of service (but no
      additional years of age) for purposes of the benefit accrual formula under
      the Pension Plans as of the date of termination of the Executive's
      employment and (ii) the benefits that the Executive is entitled to receive
      under the Pension Plans determined without regard to this subsection (f).
      Such benefits shall be payable in the same form and at the same time as
      the benefits under the respective Pension Plans.

            (g) Each stock option granted by the Company to the Executive and
      outstanding immediately prior to termination of his employment shall be
      fully vested and immediately exercisable and may be exercised by the
      Executive (or, following his 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 his employment).
      Each restricted stock 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.

            (h) The Company will pay the Executive a car allowance of $500 per
      month for 24 months following termination of the Executive's employment to
      replace the Company-leased automobile, which leased automobile will be
      returned to the Company by the Executive on the date of termination of the
      Executive's employment.

<PAGE>
                                      -12-

            (i) The Company will provide the Executive with out-placement
      services selected by the Executive, at the Company's expense not to exceed
      $10,000.

            (j) 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 Agreement or to defend against any
      claim or assertion in connection with this Agreement, but only to the
      extent the Executive substantially prevails.

            10. Change of Control. For the purposes of this Agreement, a "Change
of Control" shall be deemed to have occurred if (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) the shareholders of the Company approve (i) a plan of
complete liquidation of the Company or (ii) an agreement providing for 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;
or (d) the shareholders of the Company approve an agreement (or agreements)
providing for the sale or other disposition (in one transaction or a series of
transactions) of all or substantially all of the assets 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

<PAGE>
                                      -13-

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 Internal Revenue Code of 1986, as amended (the "Code"), 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" within the meaning of Section 280G of
the Code; provided, however, that no such reduction shall be made if the net
after-tax payment (after taking into account Federal, state, local or other
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 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 12
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 12
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 12, the severance payment described in Section 8(c) or 9(c) will
first be reduced, then the bonus described in Section 9(d), and then the
supplemental pension benefits described in Section 9(f), in each case only to
the extent necessary.

            12. Entitlement to Other Benefits. Except as otherwise provided in
this Agreement, this Agreement shall not be

<PAGE>
                                      -14-

construed as limiting in any way any rights or benefits that the Executive or
his spouse, dependents or beneficiaries may have pursuant to any other plan or
program of the Company.

            13. Indemnification. The parties agree to execute a separate
Indemnification Agreement in the form attached as Exhibit B.

            14. General Provisions.

            14.1 No Duty to Seek Employment. The Executive shall not be under
any duty or obligation to seek or accept other employment following termination
of employment, and no amount, payment or benefits due to the Executive hereunder
shall be reduced or suspended if the Executive accepts subsequent employment,
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 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 may be personally served or may be faxed with a copy deposited in the United
States mail, registered or certified, return receipt requested, postage prepaid,
addressed as follows:

      To the Company:         Lydall, Inc.
                              P.O. Box 151
                              One Colonial Road
                              Manchester, CT 06045-0151
                              Attn: Chief Executive Officer

      To the Executive:       Walter A. Ruschmeyer
                              126 Fairview Terrace
                              South Glastonbury, CT 06073

or such other address as such party shall have specified most recently by
written notice. Notice mailed as provided herein shall be deemed given on the
fifth business day following the date so mailed or on the date of actual
receipt, whichever is earlier.

            14.4 No Disparagement. The Executive shall not during the period of
his employment with the Company, nor during

<PAGE>
                                      -15-

the two-year period beginning on the date of termination of his employment for
any reason, disparage the Company or any of its subsidiaries or affiliates or
any of their shareholders, directors, officers, employees or agents. The
Executive agrees 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 Proprietary Information and Inventions. The Lydall Employee
Agreement previously executed by the Executive and attached hereto as Exhibit A
is incorporated by reference in this Agreement, and the Executive agrees to
continue to be bound thereby.

            14.6 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 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. The
Executive understands that the Executive is precluded from filing a complaint
with any governmental agency or court having jurisdiction over wrongful conduct
unless the Executive has first notified the Company of the facts and permits it
to investigate and correct the concerns.

            14.7 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.

            14.8 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 him hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to the Ex-

<PAGE>
                                      -16-

ecutive's devisee, legatee, or other designee or, if there be no such designee,
to the Executive's estate.

            14.9 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.

            14.10 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 14.10, 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.

            14.11 Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Connecticut.

            14.12 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 relating to this Agreement or the
terms or conditions of Executive's employment by the Company. 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.

            14.13 Right to Injunctive and Equitable Relief. The Executive's
obligations under Section 14.4 are of a special and unique character, which
gives them a peculiar value. The Company cannot be reasonably or adequately
compensated for damages in an action at law in the event the Executive breaches
such obligations. Therefore, the Executive expressly agrees that the Company
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 Company may possess or be entitled to pursue. Furthermore,

<PAGE>
                                      -17-

the obligations of the Executive and the rights and remedies of the Company
under Section 14.4 and this Section 14.13 are cumulative and in addition to, and
not in lieu of, any obligations, rights, or remedies as created by applicable
law.

            14.14 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.

            14.15 Entire Agreement. This Agreement, along with the Lydall
Employee Agreement and the Indemnification Agreement by and between the
Executive and the Company, constitutes 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 Lydall
Employee Agreement and the Indemnification 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 Lydall Employee Agreement and the Indemnification 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.

            14.16 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed an original but all
of which together shall constitute one and the same instrument.

<PAGE>
                                      -18-

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

                  LYDALL, INC.

                  By:
                     -------------------------------         ----------
                     Christopher R. Skomorowski              Date
                     President and Chief
                     Executive Officer

                     -------------------------------         ----------
                     Walter A. Ruschmeyer                    Date
                     126 Fairview Terrace
                     South Glastonbury, CT 06033

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00006-of-00352.parquet"}]]