Document:

exv10w11

Exhibit 10.11

AMENDED AND RESTATED CHANGE OF CONTROL AND SEVERANCE AGREEMENT

This AMENDED AND RESTATED CHANGE OF CONTROL AND SEVERANCE AGREEMENT by and between Nashua
Corporation, a Massachusetts corporation (the “Company”) and John L. Patenaude (the “Executive”),
is dated as of the 23rd day of December, 2008.

RECITALS:

WHEREAS, the Board of Directors of the Company (the “Board”), had previously determined that it was
in the best interests of the Company and its shareholders to assure that the Company will have the
continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a
Change of Control (as defined below) of the Company or other reasons of uncertainty;

WHEREAS, the Board believed it was imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending or threatened
Change of Control and business concerns and to encourage the Executive’s full attention and
dedication to the Company;

WHEREAS, in furtherance of the foregoing, the Company and the Executive entered into a Change of
Control and Severance Agreement, dated as of June 15, 2004 (the “Original Agreement”); and

WHEREAS, the Company and the Executive desire to amend and restate the Original Agreement to
provide for certain revisions required by or advisable pursuant to Section 409A of the Internal
Revenue Code of 1986, as amended from time to time (the “Code”).

NOW, THEREFORE, in consideration of the foregoing premises and certain other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Executive hereby agree that the Original Agreement is amended and restated in its entirety as
follows:

	1.	 	Certain Definitions.

	 	(a)	 	The “Effective Date” shall be the first date during the “Change of Control
Period” (as defined in Section 1(b)) on which a Change of Control occurs.
Anything in this Agreement to the contrary notwithstanding, if the Executive’s
employment with the Company is terminated or the Executive ceases to be an officer
of the Company prior to the date on which a Change of Control occurs, and it is
reasonably demonstrated that such termination of employment (1) was at the request
of a third party who has taken steps reasonably calculated to effect the Change of
Control or (2) otherwise arose in connection with or anticipation of the Change of
Control, then for all purposes of this Agreement the “Effective Date” shall mean
the date immediately prior to the date of such termination of employment.
	 
	 	(b)	 	The “Change of Control Period” is the period commencing on the date hereof and
ending on the third anniversary of such date; provided, however, that commencing
on such third anniversary, and on each annual anniversary of such date (such date
and each annual anniversary thereof is hereinafter referred to as the “Renewal
Date”), the Change of Control Period shall be automatically extended so as to
terminate one year from such Renewal Date, unless at least 60 days prior to the
Renewal Date the Company shall give notice to the Executive that the Change of
Control Period shall not be so extended.

 

 

	2.	 	Change of Control. For the purpose of this Agreement, a “Change of
Control” shall mean:

	 	(a)	 	The acquisition, other than from the Company, by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of l934, as amended (the “Exchange Act”)) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) (a “Person”)
of 50% or more of either (i) the then outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power
of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the “Company Voting Securities”),
provided, however, that any acquisition by (x) the Company or any
of its subsidiaries, or any employee benefit plan (or related trust) sponsored or
maintained by the Company or any of its subsidiaries, or (y) any corporation with
respect to which, following such acquisition, more than 60% of, respectively, the
then outstanding shares of common stock of such corporation and the combined
voting power of the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Company Voting Securities immediately prior to such acquisition
in substantially the same proportion as their ownership, immediately prior to such
acquisition, of the Outstanding Company Common Stock and Company Voting
Securities, as the case may be, or (z) Gabelli Funds, LLC, GAMCO Investors, Inc.,
Gabelli Advisers, Inc., MJG Associates, Inc., Gabelli Group Capital Partners,
Inc., Gabelli Asset Management Inc., Marc J. Gabelli and/or Mario J. Gabelli
and/or any affiliate of any of the foregoing, in the case of each of such clauses
(x), (y) and (z), shall not constitute a Change of Control; or
	 
	 	(b)	 	Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board,
provided that any individual becoming a director subsequent to the date hereof
whose election or nomination for election by the Company’s shareholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office is in connection with an actual or threatened
election contest relating to the election of the Directors of the Company (as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange
Act); or
	 
	 	(c)	 	Consummation by the Company of a reorganization, merger or consolidation (a
“Business Combination”), in each case, with respect to which all or substantially
all of the individuals and entities who were the respective beneficial owners of
the Outstanding Company Common Stock and Company Voting Securities immediately
prior to such Business Combination do not, following such Business Combination,
beneficially own, directly or indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from Business
Combination in substantially the same proportion as their ownership immediately
prior to such Business Combination of the Outstanding Company Common Stock and
Company Voting Securities, as the case may be; or

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	 	(d)	 	(i) a complete liquidation or dissolution of the Company or of (ii) sale or
other disposition of all or substantially all of the assets of the Company other
than to a corporation with respect to which, following such sale or disposition,
more than 60% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to
vote generally in the election of directors is then owned beneficially, directly
or indirectly, by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common Stock
and Company Voting Securities immediately prior to such sale or disposition in
substantially the same proportion as their ownership of the Outstanding Company
Common Stock and Company Voting Securities, as the case may be, immediately prior
to such sale or disposition.

	3.	 	Employment Period. The Company hereby agrees to continue the Executive in its
employ, and the Executive hereby agrees to remain in the employ of the Company, for the
period commencing on the Effective Date and ending on the first anniversary of such date
(the “Employment Period”).

	4.	 	Terms of Employment.

	 	(a)	 	Position and Duties.

	 	(i)	 	During the Employment Period, (A) the Executive’s position
(including status, offices, titles and reporting requirements),
authority, duties and responsibilities shall be at least commensurate
in all material respects with those held, exercised and assigned at
any time during the 90-day period immediately preceding the Effective
Date and (B) the Executive’s services shall be performed at the
location where the Executive was employed immediately preceding the
Effective Date or any office or location less than 35 miles from such
location.
	 
	 	(ii)	 	During the Employment Period, the Executive agrees to devote
his reasonable full time and attention during normal business hours to
the business and affairs of the Company and, to the extent necessary
to discharge the responsibilities assigned to the Executive hereunder,
to use the Executive’s best efforts to perform faithfully and
efficiently such responsibilities. During the Employment Period it
shall not be a violation of this Agreement for the Executive to (A)
serve on civic or charitable boards or committees, (B) serve on
corporate boards or committees other than the Company’s to the extent
approved by the Company’s Board, (C) deliver lectures, fulfill
speaking engagements or teach at educational institutions and (D)
manage personal investments, so long as such activities do not
interfere with the performance of the Executive’s responsibilities as
an employee of the Company in accordance with this Agreement. It is
expressly understood and agreed that to the extent that any such
activities have been conducted by the Executive prior to the Effective
Date, the continued conduct of such activities (or the conduct of
activities similar in nature and scope thereto) subsequent to the
Effective Date shall not thereafter be deemed to interfere with the
performance of the Executive’s responsibilities to the Company.

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	 	(b)	 	Compensation.

	 	(i)	 	Base Salary. During the Employment Period, the
Executive shall receive an annual base salary (“Annual Base Salary”),
which shall be paid at a monthly rate, at least equal to twelve times
the current monthly base salary being paid to the Executive by the
Company and its affiliated companies as of the date of this Agreement.
During the Employment Period, the Annual Base Salary shall be
reviewed at least annually and may be increased at any time and from
time to time in the sole discretion of the Board. Any increase in
Annual Base Salary shall not serve to limit or reduce any other
obligation to the Executive under this Agreement. Annual Base Salary
shall not be reduced after any such increase and the term Annual Base
Salary as utilized in this Agreement shall refer to Annual Base Salary
as so increased. As used in this Agreement, the term “affiliated
companies” includes any company controlled by, controlling or under
common control with the Company.
	 
	 	(ii)	 	Annual Bonus. In addition to Annual Base Salary, the
Executive may be awarded, for each fiscal year beginning or ending
during the Employment Period, an annual bonus (the “Annual Bonus”) in
cash as determined by the Board of Directors, in its sole discretion.
Each such Annual Bonus shall be paid no later than the end of the
fiscal year following the fiscal year for which the Annual Bonus is
awarded.
	 
	 	(iii)	 	Incentive, Savings and Retirement Plans. In
addition to Annual Base Salary and Annual Bonus payable as hereinabove
provided, the Executive shall be entitled to participate during the
Employment Period in all incentive, savings and retirement plans,
practices, policies and programs applicable generally to other peer
executives of the Company and its affiliated companies.
	 
	 	(iv)	 	Welfare Benefit Plans. During the Employment Period,
the Executive and/or the Executive’s family, as the case may be, shall
be eligible for participation in and shall receive all benefits under
welfare benefit plans, practices, policies and programs provided by
the Company and its affiliated companies (including, without
limitation, medical, prescription, dental, disability, salary
continuance, employee life, group life, accidental death and travel
accident insurance plans and programs) to the extent generally
applicable to other peer executives of the Company and its affiliated
companies.
	 
	 	(v)	 	Expenses. During the Employment Period, the
Executive shall be entitled to receive reimbursement for all
reasonable documented expenses incurred by the Executive in accordance
with the policies, practices and procedures of the Company and its
affiliated companies.
	 
	 	(vi)	 	Fringe Benefits. During the Employment Period, the
Executive shall be entitled to fringe benefits in accordance with the
plans, practices, programs and policies of the Company and its
affiliated companies in effect.

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	 	(vii)	 	Vacation. During the Employment Period, the
Executive shall be entitled to
paid vacation in accordance with the plans, policies, programs and
practices of the Company and its affiliated companies as in effect.

	5.	 	Termination of Employment.

	 	(a)	 	Death or Disability. The Executive’s employment shall terminate
automatically upon the Executive’s death during the Employment Period. If the
Company determines in good faith that the Disability of the Executive has occurred
during the Employment Period (pursuant to the definition of Disability set forth
below), it may give to the Executive written notice in accordance with Section
16(b) of this Agreement of its intention to terminate the Executive’s employment.
In such event, the Executive’s employment with the Company shall terminate
effective on the 30th day after receipt of such notice by the Executive (the
“Disability Effective Date”), provided that, within the 30 days after such
receipt, the Executive shall not have returned to full-time performance of the
Executive’s duties. For purposes of this Agreement, “Disability” means the
absence of the Executive from the Executive’s duties with the Company on a
full-time basis for 120 consecutive business days as a result of incapacity due to
mental or physical illness determined by a physician selected by the Company or
its insurers and acceptable to the Executive or Executive’s legal representative
(such agreement as to acceptability not to be withheld unreasonably).
	 
	 	(b)	 	Cause. The Company may terminate the Executive’s employment during the
Employment Period for Cause. For purposes of this Agreement, “Cause” means (i)
the Executive’s continued documented failure to perform his reasonably assigned
duties (other than any such failure resulting from incapacity due to physical or
mental illness or any failure after the Executive gives notice of termination for
Good Reason), which failure is not cured within 60 days after written notice for
substantial performance is received by the Executive from the Board which
identifies the manner in which the Board believes the Executive has not
substantially performed the Executive’s duties, (ii) the Executive being convicted
of a felony, or (iii) the Executive’s engagement in illegal conduct or gross
misconduct injurious to the Company.
	 
	 	(c)	 	Good Reason. The Executive’s employment may be terminated during the
Employment Period by the Executive for Good Reason. For purposes of this
Agreement, “Good Reason” means one or more of the following conditions arising
without the consent of the Executive, subject to the limitations set forth below:

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	 	(i)	 	A material diminution in the Executive’s position, authority,
duties, or responsibilities;
	 
	 	(ii)	 	A material diminution in the Executive’s Annual Base Salary as
in effect on the date of this Agreement or as the same was or may be
increased thereafter from time to time;
	 
	 	(iii)	 	the Company’s requiring the Executive to be based at any
office or location other than that described in Section 4(a)(i)(B) hereof;
	 
	 	(iv)	 	any purported termination by the Company of the Executive’s
employment otherwise than as expressly permitted by this Agreement; or
	 
	 	(v)	 	any failure by the Company to comply with and satisfy Section
15(c) of this Agreement.

	 	 	 	Notwithstanding the foregoing, Good Reason shall not exist unless (a) the
Executive provides notice to the Company of the existence of one or more of the
above conditions within 90 days of the initial existence of the condition(s), (b)
the Executive provides the Company a period of at least 30 days after the receipt
of such notice during which the Company may remedy the condition(s), and (c) the
Company fails to remedy such condition(s) within such period. Furthermore, Good
Reason shall not exist unless the Executive terminates employment within one year
following the initial existence of the condition(s).
	 
	 	(d)	 	Notice of Termination. Any termination by the Company for Cause or by
the Executive for Good Reason shall be communicated by Notice of Termination to
the other party hereto given in accordance with Section 16(b) of this Agreement.
For purposes of this Agreement, a “Notice of Termination” means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than fifteen days after the giving
of such notice).
	 
	 	(e)	 	Date of Termination. “Date of Termination” means the date of receipt
of the Notice of Termination or any later date specified therein, as the case may
be; provided, however, that (i) if the Executive’s employment is terminated by the
Company other than for Cause or Disability, the Date of Termination shall be the
date on which the Company notifies the Executive of such termination and (ii) if
the Executive’s employment is terminated by reason of death or Disability, the
Date of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

	6.	 	Obligations of the Company upon Termination.

	 	(a)	 	Death. If the Executive’s employment is terminated by reason of the
Executive’s death during the Employment Period, this Agreement shall terminate
without further obligations to the Executive’s legal representatives under this
Agreement, other than the following obligations: (i) payment of the Executive’s
Annual Base Salary through the Date of

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	 	 	 	Termination to the extent not theretofore paid, (ii) payment of any compensation
previously deferred by the Executive (together with any accrued interest thereon)
and not yet paid by the Company and any accrued vacation pay not yet paid by the
Company (the amounts described in paragraphs (i) and (ii) are hereafter referred
to as “Accrued Obligations”). All Accrued Obligations shall be paid to the
Executive’s estate or beneficiary, as applicable, in a lump sum in cash within 30
days of the Date of Termination. In addition to the Accrued Obligations, in the
event (A) the Board subsequently approves the payment of an annual bonus to
members of management for the fiscal year in which the Date of Termination
occurred and (B) the Executive was employed at least one quarter of such fiscal
year, then the Executive’s estate or beneficiary shall be entitled to receive an
additional payment equal to the bonus that such Executive would have received for
such fiscal year (as determined by the Board) multiplied by a fraction, the
numerator of which is the number of days in such fiscal year for which the
Executive was actually employed and the denominator is 365 days.
	 
	 	(b)	 	Disability. If the Executive’s employment is terminated by reason of
the Executive’s Disability during the Employment Period, this Agreement shall
terminate without further obligations to the Executive, other than for Accrued
Obligations. All Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination. In addition to the Accrued
Obligations, in the event (A) the Board subsequently approves the payment of an
annual bonus to members of management for the fiscal year in which the Date of
Termination occurred and (B) the Executive was employed at least one quarter of
such fiscal year, then the Executive shall be entitled to receive an additional
payment equal to the bonus that such Executive would have received for such fiscal
year (as determined by the Board) multiplied by a fraction, the numerator of which
is the number of days in such fiscal year for which the Executive was actually
employed and the denominator is 365 days.
	 
	 	(c)	 	Cause; Other than for Good Reason. If the Executive’s employment
shall be terminated for Cause during the Employment Period, this Agreement shall
terminate without further obligations to the Executive other than the obligation
to pay to the Executive Annual Base Salary through the Date of Termination plus
the amount of any compensation previously deferred by the Executive, in each case
to the extent theretofore unpaid. If the Executive terminates employment during
the Employment Period other than for Good Reason, this Agreement shall terminate
without further obligations to the Executive, other than for Accrued Obligations.
In such case, all Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination.
	 
	 	(d)	 	Good Reason; Other Than for Cause or Disability. If, during the
Employment Period, the Company shall terminate the Executive’s employment other
than for Cause or Disability, or the Executive shall terminate employment during
the Employment Period for Good Reason, the Company shall pay to the Executive in a
lump sum in cash within 60 days after the Date of Termination, and subject to
receiving an executed irrevocable Release as described in Section 12, the
aggregate of the following amounts:

	 	A.	 	all Accrued Obligations; and

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	 	B.	 	the product of (x) 1.5 and (y) the sum of (i) Annual Base
Salary and (ii) the Annual Bonus paid or payable (including any bonus
or portion thereof which has been earned but deferred) for the most
recently completed fiscal year.

	 	 	 	In addition, for the remainder of the Employment Period (if the termination took
place during the Employment Period under this Section 6), the Company shall
continue benefits to the Executive and/or the Executive’s family at least equal to
those which would have been provided to them in accordance with the plans,
programs, practices and policies described in Section 4(b)(iv) of this Agreement
if the Executive’s employment had not been terminated in accordance with the most
favorable plans, practices, programs or policies of the Company and its affiliated
companies applicable generally to other peer executives and their families during
the 90-day period immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect generally at any time thereafter with respect to
other peer executives of the Company and its affiliated companies and their
families. For purposes of determining eligibility of the Executive for retiree
benefits pursuant to such plans, practices, programs and policies, the Executive
shall be considered to have remained employed until the end of the Employment
Period and to have retired on the last day of such period.
	 
	 	 	 	Notwithstanding the foregoing, if a Change of Control or other event shall have
occurred before the Date of Termination that would result in the Executive
becoming entitled to receive payments under this Agreement or any other
arrangement that would be “parachute payments”, as defined in Section 280G of the
Code, the Company shall not be obligated to make such payments to the Executive to
the extent necessary to eliminate any “excess parachute payments” as defined in
said Section 280G; provided, however, that if the Executive would be better off by
at least $25,000 on an after-tax basis by receiving the full amount of the
parachute payments as opposed to the cut back amount (notwithstanding a 20% excise
tax) the Executive shall receive the full amount of the parachute payments.

	7.	 	Severance Benefits. Notwithstanding anything contained in this Agreement to the
contrary, if, before or after the Employment Period, the Executive’s employment is
terminated by the Company for reason other than misconduct, the Company shall pay to the
Executive one year’s salary continuation and continue medical and dental benefits during
such continuation period.
	 
	8.	 	Payments Subject to Section 409A. Subject to the provisions in this Section 8,
any severance payments or benefits under this Agreement shall begin only upon the date of
the Employee’s “separation from service” (determined as set forth below) which occurs on
or after the date of termination of the Employee’s employment. The following rules shall
apply with respect to distribution of the payments and benefits, if any, to be provided to
the Employee under this Agreement:

	 	a.	 	It is intended that each installment of the severance payments and
benefits provided under this Agreement shall be treated as a separate “payment”
for purposes of Section 409A of the Code and the guidance issued thereunder
(“Section 409A”). Neither the Company nor the Employee shall have the right to
accelerate or defer the delivery of any such payments or benefits except to the
extent specifically permitted or required by Section 409A.
	 
	 	b.	 	If, as of the date of Employee’s “separation from service” from the
Company, the Employee is not a “specified employee” (within the meaning of
Section 409A), then each installment of the severance payments and benefits
shall be made on the dates
and terms set forth in this Agreement.

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	 	c.	 	If, as of the date of the Employee’s “separation from service” from the
Company, the Employee is a “specified employee” (within the meaning of Section
409A), then:

	 	 	 	     i. Each installment of the severance payments and benefits due under this
Agreement that, in accordance with the dates and terms set forth herein, will in
all circumstances, regardless of when the separation from service occurs, be paid
within the Short-Term Deferral Period (as hereinafter defined) shall be treated
as a short-term deferral within the meaning of Treasury Regulation §
1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For
purposes of this Agreement, the “Short-Term Deferral Period” means the period
ending on the later of the fifteenth day of the third month following the end of
the Employee’s tax year in which the separation from service occurs and the
fifteenth day of the third month following the end of the Company’s tax year in
which the separation from service occurs; and
	 
	 	 	 	     ii. Each installment of the severance payments and benefits due under this
Agreement that is not described in paragraph c(i) above and that would, absent
this subsection, be paid within the six-month period following the Employee’s
“separation from service” from the Company shall not be paid until the date that
is six months and one day after such separation from service (or, if earlier, the
Employee’s death), with any such installments that are required to be delayed
being accumulated during the six-month period and paid in a lump sum on the date
that is six months and one day following the Employee’s separation from service
and any subsequent installments, if any, being paid in accordance with the dates
and terms set forth herein; provided, however, that the preceding
provisions of this sentence shall not apply to any installment of severance
payments and benefits if and to the maximum extent that such installment is
deemed to be paid under a separation pay plan that does not provide for a
deferral of compensation by reason of the application of Treasury Regulation §
1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation
from service). Any installments that qualify for the exception under Treasury
Regulation § 1.409A-1(b)(9)(iii) must be paid no later than the last day of the
Employee’s second taxable year following the taxable year in which the separation
from service occurs.

	 	d.	 	The determination of whether and when the Employee’s separation from
service from the Company has occurred shall be made and in a manner consistent
with, and based on the presumptions set forth in, Treasury Regulation §
1.409A-1(h). Solely for purposes of this paragraph d, “Company” shall include
all persons with whom the Company would be considered a single employer under
Section 414(b) and 414(c) of the Code.
	 
	 	e.	 	All reimbursements and in-kind benefits provided under this Agreement
shall be made or provided in accordance with the requirements of Section 409A to
the extent that such reimbursements or in-kind benefits are subject to Section
409A, including, where applicable, the requirements that (i) any reimbursement
is for expenses incurred during the Employee’s lifetime (or during a shorter
period of time specified in this Agreement), (ii) the amount of expenses
eligible for reimbursement during a calendar year may not affect the expenses
eligible for reimbursement in any other calendar year, (iii) the reimbursement
of an eligible expense will be made on or before the last day of the calendar
year following the year in which the expense is incurred and (iv) the right to
reimbursement is not subject to set off or liquidation or exchange for any
other benefit.

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	 	f.	 	This Agreement is intended to comply with the provisions of Section 409A
and the Agreement shall, to the extent practicable, be construed in accordance
therewith. The Company makes no representation or warranty and shall have no
liability to the Executive or any other person if any provisions of this
Agreement are determined to constitute deferred compensation subject to Section
409A and do not satisfy an exemption from, or the conditions of, Section 409A.

	9.	 	Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any benefit, bonus, incentive or other
plans, programs, policies or practices, provided by the Company or any of its affiliated
companies and for which the Executive may qualify, nor shall anything herein limit or
otherwise affect such rights as the Executive may have under any other agreements with the
Company or any of its affiliated companies. Amounts which are vested benefits or which
the Executive is otherwise entitled to receive under any plan, policy, practice or program
of the Company or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or program
except as explicitly modified by this Agreement.
	 
	10.	 	Full Settlement. The Company’s obligation to make the payments provided for in
this Agreement and otherwise to perform its obligations hereunder shall not be affected by
any set-off, counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement. The
Company agrees to pay, to the full extent permitted by law, all legal fees and expenses
which the Executive may reasonably incur as a result of any contest (but only in the event
the Executive is successful on the merits of such contest) by the Company, the Executive
or others of the validity or enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof, plus in each case interest at the
applicable Federal rate provided for in Section 7872(f)(2) of the Code.
	 
	11.	 	Other Agreements. The parties agree that this Agreement supersedes and replaces
the Prior Severance Agreement and any and all other agreements, policies, understandings
or letters (including but not limited to employment agreements, severance agreements and
job abolishment policies) between the parties related to the subject matter hereof.
	 
	12.	 	Release. Prior to receipt of the payment described in Sections 6(d) or 7, the
Executive shall execute and deliver a Release to the Company as follows:

	 	 	 	The Executive hereby fully, forever, irrevocably and unconditionally releases,
remises and discharges the Company, its officers, directors, stockholders,
corporate affiliates, agents and employees from any and all claims, charges,
complaints, demands, actions, causes of action, suits, rights, debts, sums of
money, costs, accounts, reckonings, covenants, contracts, agreements, promises,
doings, omissions, damages, executions, obligations, liabilities and expenses
(including attorneys’ fees and costs), of every kind and nature which he ever
had or now has against the Company, its officers, directors, stockholders,
corporate affiliates, agents and employees, including, but not limited to, all
claims arising out of his employment, all employment discrimination claims under
Title VII of the Civil Rights Act of 1964, 42 U.S.C.
. 2000e et
seq., the Age Discrimination in

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	 	 	 	Employment Act, 29 U.S.C., . 621 et seq., the Americans With Disabilities Act, 42
U.S.C.,
. 12101 et seq., the New Hampshire Law Against
Discrimination, N.H. Rev. Stat. Ann. . 354-A:1 et seq. and
similar state antidiscrimination laws, damages arising out of all employment
discrimination claims, wrongful discharge claims or other common law claims and
damages, provided, however, that nothing herein shall release the Company from
Executive’s Stock Option Agreements or Restricted Stock Agreements.

	 	 	The Release shall also contain, at a minimum, the following language:

	 	 	 	The Executive acknowledges that he has been given twenty-one (21)
days to consider the terms of this Release and that the Company
advised him to consult with an attorney of his own choosing prior to
signing this Release. The Executive may revoke this Release for a
period of seven (7) days after the execution of the Release and the
Release shall not be effective or enforceable until the expiration
of this seven (7) day revocation period.

	 	 	At the same time, the Company shall execute and deliver a Release to the Executive as follows:

	 	 	 	The Company hereby fully, forever, irrevocably and unconditionally releases,
remises and discharges the Executive from any and all claims which it ever had or
now has against the Executive, other than for intentional harmful acts.

	13.	 	Confidential Information. The Executive shall hold in a fiduciary capacity for
the benefit of the Company all secret or confidential information, knowledge or data
relating to the Company or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the Executive during the Executive’s
employment by the Company or any of its affiliated companies and which shall not be or
become public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement). After termination of the Executive’s
employment with the Company, the Executive shall not, without the prior written consent of
the Company, communicate or divulge any such information, knowledge or data to anyone
other than the Company and those designated by it. In no event shall an asserted
violation of the provisions of this Section 13 constitute a basis for deferring or
withholding any amounts otherwise payable to the Executive under this Agreement.
	 
	14.	 	Arbitration. Any controversy or claim arising out of this Agreement shall be
settled by binding arbitration in accordance with the commercial rules, policies and
procedures of the American Arbitration Association. Judgment upon any award rendered by
the arbitrator may be entered in any court of law having jurisdiction thereof.
Arbitration shall take place in Nashua, New Hampshire at a mutually convenient location.
	 
	15.	 	Successors.

	 	(a)	 	This Agreement is personal to the Executive and without the prior written
consent of the Company shall not be assignable by the Executive otherwise than by
will or the laws of descent and distribution. This Agreement shall inure to the
benefit of and be enforceable by the Executive’s legal representatives.
	 
	 	(b)	 	This Agreement shall inure to the benefit of and be binding upon the Company
and its successors and assigns.

- 11 -

 

	 	(c)	 	The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of 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 it if no such
succession had taken place. As used in this Agreement, “Company” shall mean the
Company as hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of law
or otherwise.

	16.	 	Miscellaneous.

	 	(a)	 	This Agreement shall be governed by and construed in accordance with the laws
of the Commonwealth of Massachusetts, without reference to principles of conflict
of laws. The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
	 
	 	(b)	 	All notices and other communications hereunder shall be in writing and shall
be given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

John L. Patenaude

1 Timber Lane

Hudson, New Hampshire 03051

If to the Company:

Nashua Corporation

11 Trafalgar Square

Nashua, New Hampshire 03063

Attention: President

	 	 	 	or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective when
actually received by the addressee.
	 
	 	(c)	 	The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
	 
	 	(d)	 	The Company may withhold from any amounts payable under this Agreement such
Federal, state or local taxes as shall be required to be withheld pursuant to any
applicable law or regulation.
	 
	 	(e)	 	The Executive’s failure to insist upon strict compliance with any provision
hereof or the failure to assert any right the Executive may have hereunder,
including, without limitation, the right to terminate employment for Good Reason
pursuant to Section 5(c)(i)-(v), shall not be deemed to be a waiver of such
provision or right or any other provision or right thereof.

- 12 -

 

	 	(f)	 	This Agreement contains the entire understanding of the Company and the
Executive with
respect to the subject matter hereof. The Executive and the Company acknowledge
that the employment of the Executive by the Company is “at will” and, prior to the
Effective Date, both the Executive’s employment and this Agreement may be
terminated by either the Company or the Executive at any time. In the event that
this Agreement is terminated by the Company prior to the Effective Date and the
Executive remains employed by the Company, the Executive would be entitled to the
same severance benefits as set forth in Section 7 of this Agreement.

     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in
its name on its behalf, all as of the day and year first above written.

	 	 	 	 	 	 	 	 	 
	NASHUA CORPORATION	 	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 	 	 
	By

	 	 /s/ Thomas G. Brooker
 

	 	 
	 	/s/ John L. Patenaude
 

	 	 
	Name:   Thomas G. Brooker	 	 	 	John L. Patenaude	 	 
	Title:    President and Chief Executive Officer	 	 	 	 	 	 

- 13 -exv10w13

Exhibit 10.13

AMENDED AND RESTATED

CHANGE OF CONTROL AND SEVERANCE AGREEMENT

     This AMENDED AND RESTATED CHANGE OF CONTROL AND SEVERANCE AGREEMENT by and between Nashua
Corporation, a Massachusetts corporation (the “Company”) and Thomas Brooker (the “Executive”), is
dated as of the 23rd day of December, 2008.

RECITALS:

     WHEREAS, the Board of Directors of the Company (the “Board”), had previously determined that
it was in the best interests of the Company and its shareholders to assure that the Company will
have the continued dedication of the Executive, notwithstanding the possibility, threat or
occurrence of a Change of Control (as defined below) of the Company or other reasons of
uncertainty;

     WHEREAS, the Board believed it was imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending or threatened
Change of Control and business concerns and to encourage the Executive’s full attention and
dedication to the Company;

     WHEREAS, in furtherance of the foregoing, the Company and the Executive entered into a Change
of Control and Severance Agreement, dated as of March 12, 2006 (the “Original Agreement”); and

     WHEREAS, the Company and the Executive desire to amend and restate the Original Agreement to
provide for certain revisions required by or advisable pursuant to Section 409A of the Internal
Revenue Code of 1986, as amended from time to time (the “Code”).

     NOW, THEREFORE, in consideration of the foregoing premises and certain other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Executive hereby agree that the Original Agreement is amended and restated in its entirety as
follows:

1. Certain Definitions.

     (a) The “Effective Date” shall be the first date during the “Change of Control Period” (as
defined in Section 1(b)) on which a Change of Control occurs. Anything in this Agreement to the
contrary notwithstanding, if the Executive’s employment with the Company is terminated or the
Executive ceases to be an officer of the Company prior to the date on which a Change of Control
occurs, and it is reasonably demonstrated that such termination of employment (1) was at the
request of a third party who has taken steps reasonably calculated to effect the Change of Control
or (2) otherwise arose in connection with or anticipation of the Change of Control, then for all
purposes of this Agreement the “Effective Date” shall mean the date immediately prior to the date
of such termination of employment.

 

 

     (b) The “Change of Control Period” is the period commencing on the date hereof and ending on
the third anniversary of such date; provided, however, that commencing on such third anniversary,
and on each annual anniversary of such date (such date and each annual anniversary thereof is
hereinafter referred to as the “Renewal Date”), the Change of Control Period shall be automatically
extended so as to terminate one year from such Renewal Date, unless at least 60 days prior to the
Renewal Date the Company shall give notice to the Executive that the Change of Control Period shall
not be so extended.

2. Change of Control. For the purpose of this Agreement, a “Change of Control” shall mean:

     (a) The acquisition, other than from the Company, by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of l934, as amended (the
“Exchange Act”)) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) (a “Person”) of 50% or more of either (i) the then outstanding shares of common stock
of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in the election of
directors (the “Company Voting Securities”), provided, however, that any
acquisition by (x) the Company or any of its subsidiaries, or any employee benefit plan (or related
trust) sponsored or maintained by the Company or any of its subsidiaries, or (y) any corporation
with respect to which, following such acquisition, more than 60% of, respectively, the then
outstanding shares of common stock of such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Company Voting Securities immediately prior to such acquisition in substantially
the same proportion as their ownership, immediately prior to such acquisition, of the Outstanding
Company Common Stock and Company Voting Securities, as the case may be, or (z) Gabelli Funds, LLC,
GAMCO Investors, Inc., Gabelli Advisers, Inc., MJG Associates, Inc., Gabelli Group Capital
Partners, Inc., Gabelli Asset Management Inc., Marc J. Gabelli and/or Mario J. Gabelli and/or any
affiliate of any of the foregoing, in the case of each of such clauses (x), (y) and (z), shall not
constitute a Change of Control; or

     (b) Individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease
for any reason to constitute at least a majority of the Board, provided that any individual
becoming a director subsequent to the date hereof whose election or nomination for election by the
Company’s shareholders, was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of
office is in connection with an actual or threatened election contest relating to the election of
the Directors of the Company (as such terms are used in Rule 14a-11 of Regulation 14A promulgated
under the Exchange Act); or

     (c) Consummation by the Company of a reorganization, merger or consolidation (a

 - 2 - 

 

“Business Combination”), in each case, with respect to which all or substantially all of the
individuals and entities who were the respective beneficial owners of the Outstanding Company
Common Stock and Company Voting Securities immediately prior to such Business Combination do not,
following such Business Combination, beneficially own, directly or indirectly, more than 60% of,
respectively, the then outstanding shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from Business Combination in substantially the same proportion
as their ownership immediately prior to such Business Combination of the Outstanding Company Common
Stock and Company Voting Securities, as the case may be; or

     (d) (i) a complete liquidation or dissolution of the Company or of (ii) sale or other
disposition of all or substantially all of the assets of the Company other than to a corporation
with respect to which, following such sale or disposition, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors is then owned beneficially,
directly or indirectly, by all or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common Stock and Company Voting
Securities immediately prior to such sale or disposition in substantially the same proportion as
their ownership of the Outstanding Company Common Stock and Company Voting Securities, as the case
may be, immediately prior to such sale or disposition.

3. Employment Period. The Company hereby agrees to continue the Executive in its employ,
and the Executive hereby agrees to remain in the employ of the Company, for the period commencing
on the Effective Date and ending on the first anniversary of such date (the “Employment Period”).

4. Terms of Employment.

     (a) Position and Duties.

     (i) During the Employment Period, (A) the Executive’s position (including status,
offices, titles and reporting requirements), authority, duties and responsibilities shall be
at least commensurate in all material respects with those held, exercised and assigned at
any time during the 90-day period immediately preceding the Effective Date and (B) the
Executive’s services shall be performed at the location where the Executive was employed
immediately preceding the Effective Date or any office or location less than 35 miles from
such location.

     (ii) During the Employment Period, the Executive agrees to devote his reasonable full
time and attention during normal business hours to the business and affairs of the Company
and, to the extent necessary to discharge the responsibilities assigned to the Executive
hereunder, to use the Executive’s best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period it shall not be a violation of this
Agreement for the Executive to (A) serve on civic or charitable boards or committees, (B) serve on corporate boards or committees other than the

 - 3 - 

 

Company’s to the extent approved by the Company’s Board, (C) deliver lectures, fulfill
speaking engagements or teach at educational institutions and (D) manage personal
investments, so long as such activities do not interfere with the performance of the
Executive’s responsibilities as an employee of the Company in accordance with this
Agreement. It is expressly understood and agreed that to the extent that any such
activities have been conducted by the Executive prior to the Effective Date, the continued
conduct of such activities (or the conduct of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with
the performance of the Executive’s responsibilities to the Company.

     (b) Compensation.

     (i) Base Salary. During the Employment Period, the Executive shall receive an
annual base salary (“Annual Base Salary”), which shall be paid at a monthly rate, at least
equal to twelve times the current monthly base salary being paid to the Executive by the
Company and its affiliated companies as of the date of this Agreement. During the
Employment Period, the Annual Base Salary shall be reviewed at least annually and may be
increased at any time and from time to time in the sole discretion of the Board. Any
increase in Annual Base Salary shall not serve to limit or reduce any other obligation to
the Executive under this Agreement. Annual Base Salary shall not be reduced after any such
increase and the term Annual Base Salary as utilized in this Agreement shall refer to Annual
Base Salary as so increased. As used in this Agreement, the term “affiliated companies”
includes any company controlled by, controlling or under common control with the Company.

     (ii) Annual Bonus. In addition to Annual Base Salary, the Executive may be
awarded, for each fiscal year beginning or ending during the Employment Period, an annual
bonus (the “Annual Bonus”) in cash as determined by the Board of Directors, in its sole
discretion. Each such Annual Bonus shall be paid no later than the end of the fiscal year
following the fiscal year for which the Annual Bonus is awarded.

     (iii) Incentive, Savings and Retirement Plans. In addition to Annual Base
Salary and Annual Bonus payable as hereinabove provided, the Executive shall be entitled to
participate during the Employment Period in all incentive, savings and retirement plans,
practices, policies and programs applicable generally to other peer executives of the
Company and its affiliated companies.

     (iv) Welfare Benefit Plans. During the Employment Period, the Executive and/or
the Executive’s family, as the case may be, shall be eligible for participation in and shall
receive all benefits under welfare benefit plans, practices, policies and programs provided
by the Company and its affiliated companies (including, without limitation, medical,
prescription, dental, disability, salary continuance, employee life, group life, accidental
death and travel accident insurance plans and programs) to the extent generally applicable
to other peer executives of the Company and its affiliated companies.

     (v) Expenses. During the Employment Period, the Executive shall be entitled

 - 4 - 

 

to receive reimbursement for all reasonable documented expenses incurred by the Executive in
accordance with the policies, practices and procedures of the Company and its affiliated
companies.

     (vi) Fringe Benefits. During the Employment Period, the Executive shall be
entitled to fringe benefits in accordance with the plans, practices, programs and policies
of the Company and its affiliated companies in effect.

     (vii) Vacation. During the Employment Period, the Executive shall be entitled
to paid vacation in accordance with the plans, policies, programs and practices of the
Company and its affiliated companies as in effect.

5. Termination of Employment.

     (a) Death or Disability. The Executive’s employment shall terminate automatically
upon the Executive’s death during the Employment Period. If the Company determines in good faith
that the Disability of the Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), it may give to the Executive written notice in
accordance with Section 16(b) of this Agreement of its intention to terminate the Executive’s
employment. In such event, the Executive’s employment with the Company shall terminate effective
on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”),
provided that, within the 30 days after such receipt, the Executive shall not have returned to
full-time performance of the Executive’s duties. For purposes of this Agreement, “Disability”
means the absence of the Executive from the Executive’s duties with the Company on a full-time
basis for 120 consecutive business days as a result of incapacity due to mental or physical illness
determined by a physician selected by the Company or its insurers and acceptable to the Executive
or Executive’s legal representative (such agreement as to acceptability not to be withheld
unreasonably).

     (b) Cause. The Company may terminate the Executive’s employment during the Employment
Period for Cause. For purposes of this Agreement, “Cause” means (i) the Executive’s continued
documented failure to perform his reasonably assigned duties (other than any such failure resulting
from incapacity due to physical or mental illness or any failure after the Executive gives notice
of termination for Good Reason), which failure is not cured within 60 days after written notice for
substantial performance is received by the Executive from the Board which identifies the manner in
which the Board believes the Executive has not substantially performed the Executive’s duties, (ii)
the Executive being convicted of a felony, or (iii) the Executive’s engagement in illegal conduct
or gross misconduct injurious to the Company.

     (c) Good Reason. The Executive’s employment may be terminated during the Employment
Period by the Executive for Good Reason. For purposes of this Agreement, “Good Reason” means one
or more of the following conditions arising without the consent of the Executive, subject to the
limitations set forth below:

          (i) A material diminution in the Executive’s position, authority, duties, or responsibilities;

 - 5 - 

 

          (ii) A material diminution in the Executive’s Annual Base Salary as in effect on the date of
this Agreement or as the same was or may be increased thereafter from time to time;

          (iii) the Company’s requiring the Executive to be based at any office or location other than
that described in Section 4(a)(i)(B) hereof;

          (iv) any purported termination by the Company of the Executive’s employment otherwise than as
expressly permitted by this Agreement; or

          (v) any failure by the Company to comply with and satisfy Section 14(c) of this Agreement.

Notwithstanding the foregoing, Good Reason shall not exist unless (a) the Executive provides notice
to the Company of the existence of one or more of the above conditions within 90 days of the
initial existence of the condition(s), (b) the Executive provides the Company a period of at least
30 days after the receipt of such notice during which the Company may remedy the condition(s), and
(c) the Company fails to remedy such condition(s) within such period. Furthermore, Good Reason
shall not exist unless the Executive terminates employment within one year following the initial
existence of the condition(s).

     (d) Notice of Termination. Any termination by the Company for Cause or by the
Executive for Good Reason shall be communicated by Notice of Termination to the other party hereto
given in accordance with Section 16(b) of this Agreement. For purposes of this Agreement, a
“Notice of Termination” means a written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) to the extent applicable sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) if the Date of Termination (as defined below)
is other than the date of receipt of such notice, specifies the termination date (which date shall
be not more than fifteen days after the giving of such notice).

     (e) Date of Termination. “Date of Termination” means the date of receipt of the
Notice of Termination or any later date specified therein, as the case may be; provided, however,
that (i) if the Executive’s employment is terminated by the Company other than for Cause or
Disability, the Date of Termination shall be the date on which the Company notifies the Executive
of such termination and (ii) if the Executive’s employment is terminated by reason of death or
Disability, the Date of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

6. Obligations of the Company upon Termination.

     (a) Death. If the Executive’s employment is terminated by reason of the Executive’s
death during the Employment Period, this Agreement shall terminate without further obligations to
the Executive’s legal representatives under this Agreement, other than the following obligations:
(i) payment of the Executive’s Annual Base Salary through the Date of Termination

 - 6 - 

 

to the extent not theretofore paid, (ii) payment of any compensation previously deferred by the Executive (together
with any accrued interest thereon) and not yet paid by the Company and any accrued vacation pay not
yet paid by the Company (the amounts described in paragraphs (i) and (ii) are hereafter referred to
as “Accrued Obligations”). All Accrued Obligations shall be paid to the Executive’s estate or
beneficiary, as applicable, in a lump sum in cash within 30 days of the Date of Termination. In
addition to the Accrued Obligations, in the event (A) the Board subsequently approves the payment
of an annual bonus to members of management for the fiscal year in which the Date of Termination
occurred and (B) the Executive was employed at least one quarter of such fiscal year, then the
Executive’s estate or beneficiary shall be entitled to receive an additional payment equal to the
bonus that such Executive would have received for such fiscal year (as determined by the Board)
multiplied by a fraction, the numerator of which is the number of days in such fiscal year for
which the Executive was actually employed and the denominator is 365 days.

     (b) Disability. If the Executive’s employment is terminated by reason of the
Executive’s Disability during the Employment Period, this Agreement shall terminate without further
obligations to the Executive, other than for Accrued Obligations. All Accrued Obligations shall be
paid to the Executive in a lump sum in cash within 30 days of the Date of Termination. In addition
to the Accrued Obligations, in the event (A) the Board subsequently approves the payment of an
annual bonus to members of management for the fiscal year in which the Date of Termination occurred
and (B) the Executive was employed at least one quarter of such fiscal year, then the Executive
shall be entitled to receive an additional payment equal to the bonus that such Executive would
have received for such fiscal year (as determined by the Board) multiplied by a fraction, the
numerator of which is the number of days in such fiscal year for which the Executive was actually
employed and the denominator is 365 days.

     (c) Cause; Other than for Good Reason. If the Executive’s employment shall be
terminated for Cause during the Employment Period, this Agreement shall terminate without further
obligations to the Executive other than the obligation to pay to the Executive Annual Base Salary
through the Date of Termination plus the amount of any compensation previously deferred by the
Executive, in each case to the extent theretofore unpaid. If the Executive terminates employment
during the Employment Period other than for Good Reason, this Agreement shall terminate without
further obligations to the Executive, other than for Accrued Obligations. In such case, all
Accrued Obligations shall be paid to the Executive in a lump sum in cash within 30 days of the Date
of Termination.

     (d) Good Reason; Other Than for Cause or Disability. If, during the Employment
Period, the Company shall terminate the Executive’s employment other than for Cause or Disability,
or the Executive shall terminate employment during the Employment Period for Good Reason, the
Company shall pay to the Executive in a lump sum in cash within 60 days after the Date of
Termination, and subject to receiving an executed irrevocable Release as described in
Section 11, the aggregate of the following amounts:

	 	A.	 	all Accrued Obligations; and
	 
	 	B.	 	the product of (x) 2 and (y) the sum of (i) Annual Base Salary and (ii) the
Annual

 - 7 - 

 

	 	 	 	Bonus paid or payable (including any bonus or portion thereof that has been
earned but deferred) for the most recently completed fiscal year.

     In addition, for the remainder of the Employment Period (if the termination took place during
the Employment Period under this Section 6), the Company shall continue benefits to the Executive
and/or the Executive’s family at least equal to those which would have been provided to them in
accordance with the plans, programs, practices and policies described in Section 4(b)(iv) of this
Agreement if the Executive’s employment had not been terminated in accordance with the most
favorable plans, practices, programs or policies of the Company and its affiliated companies
applicable generally to other peer executives and their families during the 90-day period
immediately preceding the Effective Date or, if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer executives of the Company and its
affiliated companies and their families. For purposes of determining eligibility of the Executive
for retiree benefits pursuant to such plans, practices, programs and policies, the Executive shall
be considered to have remained employed until the end of the Employment Period and to have retired
on the last day of such period.

     Notwithstanding the foregoing, if a Change of Control or other event shall have occurred
before the Date of Termination that would result in the Executive becoming entitled to receive
payments under this Agreement or any other arrangement that would be “parachute payments”, as
defined in Section 280G of the Code, the Company shall not be obligated to make such payments to
the Executive to the extent necessary to eliminate any “excess parachute payments” as defined in
said Section 280G; provided, however, that if the Executive would be better off by at least
$25,000 on an after-tax basis by receiving the full amount of the parachute payments as opposed to
the cut back amount (notwithstanding a 20% excise tax) the Executive shall receive the full amount
of the parachute payments.

7. Severance Benefits. Notwithstanding anything contained in this Agreement to the
contrary, if, before or after the Employment Period, the Executive’s employment is terminated by
the Company for reason other than misconduct, the Company shall pay to the Executive salary and
continue medical and dental benefits for a period of one year following such termination (the “Date
of Termination”); provided, however, that the Executive shall not be entitled to
such salary and benefits continuation under this Agreement for any portion of such one year period
(or the entire one year period, if applicable) during which the Executive receives salary
continuation and benefits pursuant to any other agreement or arrangement with the Company. The
Executive shall be entitled to receive payments pursuant to this Section 7 on the first business
day that is six months and one day following the Date of Termination and thereafter the Executive
shall receive salary continuation pursuant to this Section 7 in accordance with the Company’s
customary payroll practices. The preceding sentence shall not apply to payments made with respect
to terminations of employment occurring after December 31, 2008.

8. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any benefit, bonus, incentive or other plans,
programs, policies or practices, provided by the Company or any of its affiliated companies and for
which the Executive may qualify, nor shall anything herein limit or otherwise affect such rights as
the Executive may have under any other agreements with the Company or any of its affiliated

 - 8 - 

 

companies. Amounts which are vested benefits or which the Executive is otherwise entitled to
receive under any plan, policy, practice or program of the Company or any of its affiliated
companies at or subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program except as explicitly modified by this Agreement.

9. Full Settlement. The Company’s obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the Company may have
against the Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement. The Company agrees to pay, to the full extent
permitted by law, all legal fees and expenses which the Executive may reasonably incur as a result
of any contest (but only in the event the Executive is successful on the merits of such contest) by
the Company, the Executive or others of the validity or enforceability of, or liability under, any
provision of this Agreement or any guarantee of performance thereof, plus in each case interest at
the applicable Federal rate provided for in Section 7872(f)(2) of the Code.

10. Other Agreements. The parties agree that this Agreement supersedes and replaces any
and all other agreements, policies, understandings or letters (including but not limited to
employment agreements, severance agreements and job abolishment policies) between the parties
related to the subject matter hereof.

11. Release. Prior to receipt of the payment described in Sections 6(d) or 7, the
Executive shall execute and deliver a Release to the Company as follows:

The Executive hereby fully, forever, irrevocably and unconditionally releases, remises and
discharges the Company, its officers, directors, stockholders, corporate affiliates, agents
and employees from any and all claims, charges, complaints, demands, actions, causes of
action, suits, rights, debts, sums of money, costs, accounts, reckonings, covenants,
contracts, agreements, promises, doings, omissions, damages, executions, obligations,
liabilities and expenses (including attorneys’ fees and costs), of every kind and nature
which he ever had or now has against the Company, its officers, directors, stockholders,
corporate affiliates, agents and employees, including, but not limited to, all claims
arising out of his employment, all employment discrimination claims under Title VII of the
Civil Rights Act of 1964, 42
U.S.C. 2000e et seq., the Age Discrimination in
Employment Act, 29 U.S.C.,. 621 et seq., the Americans With Disabilities
Act, 42 U.S.C.., 12101 et seq., the New Hampshire Law Against Discrimination,
N.H. Rev. Stat. Ann.. 354-A:1 et seq. and similar state antidiscrimination
laws, damages arising out of all employment discrimination claims, wrongful discharge claims
or other common law
claims and damages, provided, however, that nothing herein shall release the Company from
Executive’s Stock Option Agreements or Restricted Stock Agreements.

The Release shall also contain, at a minimum, the following language:

The Executive acknowledges that he has been given twenty-one (21) days to consider the terms
of this Release and that the Company advised him to consult with an attorney of his

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own choosing prior to signing this Release. The Executive may revoke this Release for a period
of seven (7) days after the execution of the Release and the Release shall not be effective
or enforceable until the expiration of this seven (7) day revocation period.

At the same time, the Company shall execute and deliver a Release to the Executive as follows:

The Company hereby fully, forever, irrevocably and unconditionally releases, remises and
discharges the Executive from any and all claims which it ever had or now has against the
Executive, other than for intentional harmful acts.

12. Confidential Information. The Executive shall hold in a fiduciary capacity for the
benefit of the Company all secret or confidential information, knowledge or data relating to the
Company or any of its affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive’s employment by the Company or any of its affiliated
companies and which shall not be or become public knowledge (other than by acts by the Executive or
representatives of the Executive in violation of this Agreement). After termination of the
Executive’s employment with the Company, the Executive shall not, without the prior written consent
of the Company, communicate or divulge any such information, knowledge or data to anyone other than
the Company and those designated by it. In no event shall an asserted violation of the provisions
of this Section 12 constitute a basis for deferring or withholding any amounts otherwise payable to
the Executive under this Agreement.

13. Arbitration. Any controversy or claim arising out of this Agreement shall be settled
by binding arbitration in accordance with the commercial rules, policies and procedures of the
American Arbitration Association. Judgment upon any award rendered by the arbitrator may be
entered in any court of law having jurisdiction thereof. Arbitration shall take place in Nashua,
New Hampshire at a mutually convenient location.

14. Successors.

     (a) This Agreement is personal to the Executive and without the prior written consent of the
Company shall not be assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

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     (b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

     (c) The Company will require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of 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 it if no such succession had taken place. As
used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor
to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law or otherwise.

15. Payments Subject to Section 409A. Subject to the provisions in this Section 15, any
severance payments or benefits under this Agreement shall begin only upon the date of the
Employee’s “separation from service” (determined as set forth below) which occurs on or after the
date of termination of the Employee’s employment. The following rules shall apply with respect to
distribution of the payments and benefits, if any, to be provided to the Employee under this
Agreement:

     a. It is intended that each installment of the severance payments and benefits provided under
this Agreement shall be treated as a separate “payment” for purposes of Section 409A of the Code
and the guidance issued thereunder (“Section 409A”). Neither the Company nor the Employee shall
have the right to accelerate or defer the delivery of any such payments or benefits except to the
extent specifically permitted or required by Section 409A.

     b. If, as of the date of Employee’s “separation from service” from the Company, the Employee
is not a “specified employee” (within the meaning of Section 409A), then each installment of the
severance payments and benefits shall be made on the dates and terms set forth in this Agreement.

     c. If, as of the date of the Employee’s “separation from service” from the Company, the
Employee is a “specified employee” (within the meaning of Section 409A), then:

          i. Each installment of the severance payments and benefits due under this Agreement that, in
accordance with the dates and terms set forth herein, will in all circumstances, regardless of when
the separation from service occurs, be paid within the Short-Term Deferral Period (as hereinafter
defined) shall be treated as a short-term deferral within the meaning of Treasury Regulation §
1.409A-1(b)(4) to the maximum extent permissible under Section 409A. For purposes of this
Agreement, the “Short-Term Deferral Period” means the period ending on the later of the fifteenth
day of the third month following the end of the Employee’s tax year in which the separation from
service occurs and the fifteenth day of the third month following the end of the Company’s tax year
in which the separation from service occurs; and

          ii. Each installment of the severance payments and benefits due under this Agreement that is
not described in paragraph c(i) above and that would, absent this subsection, be paid within the
six-month period following the Employee’s “separation from service” from the Company shall not be
paid until the date that is six months and one day after such separation

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from service (or, if earlier, the Employee’s death), with any such installments that are required
to be delayed being accumulated during the six-month period and paid in a lump sum on the date that
is six months and one day following the Employee’s separation from service and any subsequent
installments, if any, being paid in accordance with the dates and terms set forth herein;
provided, however, that the preceding provisions of this sentence shall not apply
to any installment of severance payments and benefits if and to the maximum extent that such
installment is deemed to be paid under a separation pay plan that does not provide for a deferral
of compensation by reason of the application of Treasury Regulation § 1.409A-1(b)(9)(iii) (relating
to separation pay upon an involuntary separation from service). Any installments that qualify for
the exception under Treasury Regulation § 1.409A-1(b)(9)(iii) must be paid no later than the last
day of the Employee’s second taxable year following the taxable year in which the separation from
service occurs.

     d. The determination of whether and when the Employee’s separation from service from the
Company has occurred shall be made and in a manner consistent with, and based on the presumptions
set forth in, Treasury Regulation § 1.409A-1(h). Solely for purposes of this paragraph d,
“Company” shall include all persons with whom the Company would be considered a single employer
under Section 414(b) and 414(c) of the Code.

     e. All reimbursements and in-kind benefits provided under this Agreement shall be made or
provided in accordance with the requirements of Section 409A to the extent that such reimbursements
or in-kind benefits are subject to Section 409A, including, where applicable, the requirements that
(i) any reimbursement is for expenses incurred during the Employee’s lifetime (or during a shorter
period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement
during a calendar year may not affect the expenses eligible for reimbursement in any other calendar
year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the
calendar year following the year in which the expense is incurred and (iv) the right to
reimbursement is not subject to set off or liquidation or exchange for any other benefit.

     f. This Agreement is intended to comply with the provisions of Section 409A and the Agreement
shall, to the extent practicable, be construed in accordance therewith. The Company makes no
representation or warranty and shall have no liability to the Executive or any other person if any
provisions of this Agreement are determined to constitute deferred compensation subject to Section
409A and do not satisfy an exemption from, or the conditions of, Section 409A.

16. Miscellaneous.

     (a) This Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts, without reference to principles of conflict of laws. The captions
of this Agreement are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.

 - 12 - 

 

     (b) All notices and other communications hereunder shall be in writing and shall be given by
hand delivery to the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to the Executive:

Thomas Brooker

1156 S. Grove Avenue

Oak Park, Illinois 60304

If to the Company:

Nashua Corporation

11 Trafalgar Square

Nashua, New Hampshire 03063

Attention: Chief Financial Officer

or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received by the addressee.

     (c) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.

     (d) The Company may withhold from any amounts payable under this Agreement such Federal, state
or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.

     (e) The Executive’s failure to insist upon strict compliance with any provision hereof or the
failure to assert any right the Executive may have hereunder, including, without limitation, the
right to terminate employment for Good Reason pursuant to Section 5(c)(i)-(v), shall not be deemed
to be a waiver of such provision or right or any other provision or right thereof.

     (f) This Agreement contains the entire understanding of the Company and the Executive with
respect to the subject matter hereof. The Executive and the Company acknowledge that the
employment of the Executive by the Company is “at will” and, prior to the Effective Date, both the
Executive’s employment and this Agreement may be terminated by either the Company or the Executive
at any time. In the event that this Agreement is terminated by the Company prior to the Effective
Date and the Executive remains employed by the Company, the Executive would be entitled to the same
severance benefits as set forth in Section 7 of this Agreement.

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     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board of Directors, the Company has caused these presents to be executed in
its name on its behalf, all as of the day and year first above written.

	 	 	 	 	 	 	 	 	 
	NASHUA CORPORATION	 	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 	 	 
	By

	 	/s/ John L. Patenaude
 

	 	 	 	/s/ Thomas Brooker
 

	 	 
	Name: John L. Patenaude	 	 	 	Name: Thomas Brooker	 	 
	Title:   Vice President-Finance,	 	 	 	 	 	 
	 

	 	     Chief Financial Officer	 	 	 	 	 	 

 - 14 -

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