Nordson (NDSN) 10-K risk factor changes: FY2017 vs FY2016

Changes in United States or international economic [removed: conditions] [added: conditions, including declines in the industries we serve,] could adversely affect the profitability of any of our operations.

In [removed: 2016,] [added: 2017,] approximately [removed: 29] [added: 31] percent of our revenue was generated in the United States, while approximately [removed: 71] [added: 69] percent was generated outside the United States.

The majority of our consolidated revenues in [removed: 2016] [added: 2017] were generated in currencies other than the United States dollar, which is our reporting currency.

We cannot predict the effects of exchange rate fluctuations upon our future operating results because of the [removed: number of currencies involved, the variability of currency exposures and the potential volatility of currency exchange rates.]

For example, the announcement of Brexit [added: and subsequent steps taken by Britain to begin withdrawal from the European Union] caused volatility in global currency exchange rate fluctuations that resulted in the strengthening of the United States dollar against foreign currencies in which we conduct business.

[added: We] continue to invest in the development and marketing of new products.

We cannot assure we will be able to successfully identify suitable acquisition opportunities, prevail against competing potential acquirers, negotiate appropriate acquisition terms, obtain financing that may be needed to [removed: consummate such acquisitions, complete proposed acquisitions, successfully integrate acquired businesses into our existing operations or expand into new markets.]

| • | the risks associated with the assumption of [added: product liabilities,] contingent or undisclosed liabilities of acquisition targets; and |

We could also incur significant costs, including, but not limited to, remediation costs, natural resources damages, civil or criminal fines and sanctions and third-party claims, as a result of past or future violations of, or [removed: liabilities] [added: liabilities,] associated with environmental laws.

We might be prohibited from selling our products before we obtain a license, which, if available at all, [removed: may require us to pay substantial royalties.]

[removed: Inability] [added: Our inability] to [added: comply with our existing credit facilities’ restrictive covenants or to] access [added: additional sources of] capital could impede growth or the repayment or refinancing of existing indebtedness.

In addition, our credit facilities require us to meet financial ratios, including a “Leverage Ratio” and an “Interest Coverage [removed: Ratio”,] [added: Ratio,”] both as defined in the credit facilities.

At October 31, [removed: 2016,] [added: 2017,] we had [removed: $984,787] [added: $1,582,984] of total debt and notes payable outstanding, of which [removed: 64] [added: 80] percent was priced at interest rates that float with the market.

A one percent increase in the interest rate on the floating rate debt in [removed: 2016] [added: 2017] would have resulted in approximately [removed: $7,205] [added: $11,064] of additional interest expense.

Political conditions in [added: the U.S. and] foreign countries in which we operate could adversely affect us.

In [removed: 2016,] [added: 2017,] approximately [removed: 71] [added: 69] percent of our total sales were generated outside the United States.

While we have taken precautions to prevent production and service interruptions at our global facilities, severe weather conditions such as hurricanes or tornadoes, as well [added: as] major [removed: earthquakes] [added: earthquakes, wildfires] and other natural disasters, [added: as well as cyberterrorism,] in areas in which we have manufacturing facilities or from which we obtain products may cause physical damage to our properties, closure of one or more of our manufacturing or distribution facilities, lack of an adequate work force in a market, temporary disruption in the supply of inventory, disruption in the transport of products and utilities, and delays in the delivery of products to our customers.

In March 2017, we completed the acquisition of Vention, a leading designer, developer and manufacturer of minimally invasive interventional delivery devices, catheters and advanced components for the global medical technology market.

Failure to achieve the anticipated benefits of the Vention acquisition could result in increased costs, decreases in the amount of expected revenues and diversion of management’s time and energy and could have an adverse effect on the acquired company’s business, financial condition, operating results and prospects.

In addition, it is possible that the integration process could result in the disruption of our ongoing businesses or cause inconsistencies in standards, controls, procedures, and policies that adversely affect our ability to maintain relationships with customers and employees or to achieve the anticipated benefits of the acquisition.

consummate such acquisitions, complete proposed acquisitions, successfully integrate acquired businesses into our existing operations or expand into new markets.

The interpretation and application of data protection laws, including federal, state and international laws, relating to the collection, use, retention, disclosure, security and transfer of personally identifiable data in the U.S., Europe (including but not limited to the General Data Protection Regulation), and elsewhere, are uncertain and evolving.

It is possible that these laws may be interpreted and applied in a manner that is inconsistent with our data practices.

Complying with these laws may cause us to incur substantial costs or require us to change our business practices in a manner adverse to our business.

number of currencies involved, the variability of currency exposures and the potential volatility of currency exchange rates.

Changes in United States and international tax law may have a material adverse effect on our business, financial condition and results of operations.

We are subject to income taxes in the United States and various foreign jurisdictions.

Changes in applicable domestic or foreign tax laws and regulations, or their interpretation and application, including the possibility of retroactive effect, could affect our business, financial condition and profitability by increasing our tax liabilities.

Our future results of operations could be adversely affected by changes in our effective tax rate as a result of a change in the mix of earnings in jurisdictions with differing statutory tax rates, changes in our overall profitability, changes in tax legislation and rates, changes in generally accepted accounting principles and changes in the valuation of deferred tax assets and liabilities.

The U.S. federal government may adopt changes to international trade agreements, tariffs, taxes and other government rules and regulations.

While we cannot predict what changes will actually occur with respect to any of these items, such changes could affect our business and results of operations.

may require us to pay substantial royalties.

| • | changes in tax rates, adoption of new tax laws or other additional tax policies, including the implementation of proposals to reform United States and foreign tax laws that could impact how United States multinational corporations are taxed on foreign earnings; |

| • | the imposition of tariffs, import or export licensing requirements and other potential changes in trade policies and relations arising from policy initiatives implemented by the new U.S. presidential administration; and |

| --- | --- |

Nordson Corporation 14

The new U.S. presidential administration has criticized existing trade agreements, and while it is currently unclear what actions the administration may take with respect to existing and proposed trade agreements, or restrictions on trade generally, more stringent export and import controls may be imposed in the future.

We

| • | the imposition of tariffs, import or export licensing requirements; and |

Revenues deferred in [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014] [added: 2015] were not material.

[added: We use an independent valuation specialist to assist with] refining our assumptions and methods used to determine fair values using these methods.

In step one, the discounted cash flow method uses assumptions for revenue growth, operating margin, and working capital turnover that are based on [removed: general] management’s strategic plans tempered by performance trends and reasonable expectations about those trends.

For [removed: 2016,] [added: 2017,] the discount rates used ranged from 9 percent to [removed: 15] [added: 12] percent depending upon the reporting unit's size, end market volatility, and projection risk.

The calculated internal rate of return for the discounted cash flow method was [removed: 10] [added: 9] percent, the same as the calculated WACC for total Nordson.

The control premium was [removed: 1] [added: negative 3] percent as of the test date of August 1, [removed: 2016] [added: 2017] and a slight discount to the market value of equity as of October 31, [removed: 2016.][added: 2017.]

Based on the results shown in the table below and based on our measurement date of August 1, [removed: 2016,] [added: 2017,] our conclusion is that no [removed: indicators of impairment exist] [added: goodwill was impaired] in [removed: 2016.][added: 2017.]

| Adhesive Dispensing Systems Segment | | | 9% | | | | [removed: 402%] [added: 489%] | | | $ | [removed: 387,649] [added: 394,234] | |

| Industrial Coating Systems Segment | | | [removed: 12%] [added: 11%] | | | | [removed: 287%] [added: 503%] | | | $ | 24,058 | |

| Advanced Technology Systems Segment - Electronics Systems | | | [removed: 11%] [added: 10%] | | | | [removed: 235%] [added: 329%] | | | $ | [removed: 17,495] [added: 27,224] | |

| Advanced Technology Systems Segment - Fluid Management | | | [removed: 10%] [added: 9%] | | | | [removed: 92%] [added: 83%] | | | $ | [removed: 608,955] [added: 1,092,940] | |

| Advanced Technology Systems Segment - Test & Inspection | | | [removed: 15%] [added: 12%] | | | | [removed: 33%] [added: 51%] | | | $ | [removed: 46,650] [added: 48,499] | |

The weighted-average discount rate used to determine the present value of our domestic pension plan obligations was [removed: 3.94] [added: 3.80] percent at October 31, [removed: 2016] [added: 2017] and [removed: 4.39] [added: 3.94] percent at October 31, [removed: 2015.][added: 2016.]

The weighted-average discount rate used to determine the present value of our various international pension plan obligations was [removed: 1.86] [added: 2.07] percent at October 31, [removed: 2016,] [added: 2017,] compared to [removed: 2.81] [added: 1.86] percent at October 31, [removed: 2015.][added: 2016.]

The expected rate of return (long-term investment rate) on domestic pension assets used to determine net benefit costs was [removed: 6.72] [added: 6.25] percent in [removed: 2016] [added: 2017] and [removed: 6.76] [added: 6.72] percent in [removed: 2015.][added: 2016.]

The average expected rate of return on international pension assets used to determine net benefit costs was [removed: 4.22] [added: 3.51] percent in [removed: 2016] [added: 2017] and [removed: 4.39] [added: 4.22] percent in [removed: 2015.][added: 2016.]

The assumed rate of compensation increases used to determine the present value of our domestic pension plan obligations was 3.61 percent at October 31, [removed: 2016,] [added: 2017,] compared to [removed: 3.50] [added: 3.61] percent at October 31, [removed: 2015.][added: 2016.]

The assumed rate of compensation increases used to determine the present value of our international pension plan obligations was [removed: 3.12] [added: 3.13] percent at October 31, [removed: 2016,] [added: 2017,] compared to [removed: 3.22] [added: 3.12] percent at October 31, [removed: 2015.][added: 2016.]

| Effect on total service and interest cost components in [removed: 2016] [added: 2017] | | $ | [removed: (5,561] [added: (3,326] | ) | | $ | [removed: 6,767] [added: 3,326] | | | $ | [removed: (887] [added: (375] | ) | | $ | [removed: 1,048] [added: 375] | |

| Effect on total service and interest cost components in [removed: 2016] [added: 2017] | | $ | [removed: (3,017] [added: (585] | ) | | $ | [removed: 3,017] [added: 696] | | | $ | [removed: (361] [added: (3] | ) | | $ | [removed: 361] [added: 3] | |

| Effect on total service and interest cost components in [removed: 2016] [added: 2017] | | $ | [removed: 4,017] [added: 562] | | | $ | [removed: (2,394] [added: (446] | ) | | $ | [removed: 708] [added: 10] | | | $ | [removed: (638] [added: (8] | ) |

With respect to the domestic postretirement medical plan, the discount rate used to value the benefit plan was [removed: 4.05] [added: 3.86] percent at October 31, [removed: 2016] [added: 2017] and [removed: 4.50] [added: 4.05] percent at October 31, [removed: 2015.][added: 2016.]

The annual rate of increase in the per capita cost of covered benefits (the health care cost trend rate) is assumed to be [removed: 3.63] [added: 3.70] percent in [removed: 2017,] [added: 2018,] decreasing gradually to [removed: 3.24] [added: 3.23] percent in 2026.

For the international postretirement plan, the discount rate used to value the benefit obligation was [removed: 3.40] [added: 3.52] percent at October 31, [removed: 2016] [added: 2017] and [removed: 4.35] [added: 3.40] percent at October 31, [removed: 2015.][added: 2016.]

The annual rate of increase in the per capita cost of covered benefits (the health care cost trend rate) is assumed to be [removed: 6.13] [added: 6.50] percent in [removed: 2017,] [added: 2018,] decreasing gradually to 3.50 percent in [removed: 2031.][added: 2037.]

| Effect on total service and interest cost components in [removed: 2016] [added: 2017] | | $ | [removed: (710] [added: (5,320] | ) | | $ | [removed: 860] [added: 6,490] | | | $ | [removed: (6] [added: (1,417] | ) | | $ | [removed: 6] [added: 1,766] | |

| Effect on total service and interest cost components in [removed: 2016] [added: 2017] | | $ | [removed: 628] [added: 4,127] | | | $ | [removed: (495] [added: (2,755] | ) | | $ | [removed: 10] [added: 635] | | | $ | [removed: (8] [added: (511] | ) |

In the fourth quarter of 2016, we adopted a change in the method [added: to be] used to estimate the service and interest cost components of net periodic benefit cost for defined benefit pension [removed: plans and postretirement benefit] plans.

Beginning in 2017, we [removed: will use] [added: used] a spot rate approach by applying the specific spot rates along the yield curve to the relevant projected cash flows in the estimation of the service and interest components of benefit cost, resulting in a more precise measurement.

This change [removed: does] [added: did] not affect the measurement of total benefit obligations.

The change [removed: will be] [added: was] accounted for as a change in estimate that is inseparable from a change in accounting principle and, accordingly, [removed: will be] [added: was] accounted for prospectively [removed: starting in 2017.]

The reductions in service and interest costs for 2017 associated with this change [removed: are expected to be $1,100] [added: were $1,200] and [removed: $3,700,] [added: $3,100,] respectively.

It is estimated that the effect of pricing on [added: 2016] total [removed: revenue] [added: sales] was not material relative to 2015.

Sales volume increased [removed: 5.8 percent,] [added: 14.8 percent] and unfavorable currency translation effects [removed: caused by the stronger U.S. dollar] reduced sales by [removed: 6.7] [added: 0.5] percent.

The volume increase consisted of [removed: 3.4] [added: 7.9] percent from organic growth and [removed: 2.4] [added: 6.9] percent from acquisitions.

The [removed: decrease] [added: increase] was the net result of a sales volume increase of [removed: 2.3] [added: 4.3] percent [added: partially] offset by unfavorable currency effects that reduced sales by [removed: 9.4] [added: 0.2] percent.

The [added: increase in] sales volume [removed: increase] consisted of [removed: 0.3] [added: 5.3] percent from [removed: acquisitions] [added: organic volume] and [removed: 2.0] [added: 16.6] percent from [removed: organic volume.][added: acquisitions.]

Within [removed: this] [added: the] segment, sales volume, inclusive of acquisitions, increased in all geographic [removed: regions except for the United States, and was particularly strong in the Americas.][added: regions.]

[removed: Organic growth] [added: Growth] in product lines serving [added: rigid packaging, consumer non-durable,] disposable [removed: hygiene,] [added: hygiene and] general product [removed: assembly, rigid packaging and injection molding] [added: assembly] end [removed: markets] [added: markets,] was offset by softness in product lines serving [removed: extrusion,] polymer [removed: compounding and pelletizing] [added: processing] end markets.

The increase was the result of a sales volume increase of [removed: 8.6] [added: 33.4] percent [added: partially] offset by unfavorable currency effects that reduced sales by [removed: 2.9] [added: 0.7] percent.

Business combinations – The acquisitions of our businesses are accounted for under the acquisition method of accounting.

The amounts assigned to the identifiable assets acquired and liabilities assumed in connection with acquisitions are based on estimated fair values as of the date of the acquisition, with the remainder, if any, recorded as goodwill.

The fair values are determined by management, taking into consideration information supplied by the management of the acquired entities, and other relevant information.

Such information typically includes valuations obtained from independent appraisal experts, which management reviews and considers in its estimates of fair values.

The valuations are generally based upon future cash flow projections for the acquired assets, discounted to present value.

The determination of fair values requires significant judgment by management, particularly with respect to the value of identifiable intangible assets.

This judgment could result in either a higher or lower value assigned to amortizable or depreciable assets.

The impact could result in either higher or lower amortization and/or depreciation expense.

Under a new accounting standard adopted this year (See Note 2 for additional information), a goodwill impairment charge is recorded for the amount by which the carrying value of the reporting unit exceeds the fair value of the reporting unit, as calculated in the quantitative analysis described below.

We did not record any goodwill impairment charges in 2017.

In 2017 and 2016, the results of our annual impairment tests indicated no impairment.

| Effect on pension obligation as of October 31, 2017 | | $ | (56,644 | ) | | $ | 71,919 | | | $ | (14,440 | ) | | $ | 17,356 | |

| Effect on pension obligation as of October 31, 2017 | | $ | 23,174 | | | $ | (14,753 | ) | | $ | 3,261 | | | $ | (3,062 | ) |

| Effect on postretirement obligation as of October 31, 2017 | | $ | (10,504 | ) | | $ | 13,327 | | | $ | (119 | ) | | $ | 159 | |

| Effect on postretirement obligation as of October 31, 2017 | | $ | 10,637 | | | $ | (8,650 | ) | | $ | 150 | | | $ | (115 | ) |

starting in 2017.

Pension and postretirement expenses in 2018 are expected to be approximately $474 higher than 2017.

2017 compared to 2016

Sales – Worldwide sales for 2017 were $2,066,982, an increase of 14.3 percent from 2016 sales of $1,808,994.

We had four acquisitions during 2017, ACE Production Technologies, Inc. (“ACE”), Plas-Pak Industries, Inc. (“Plas-Pak), InterSelect GmbH (“InterSelect”), and Vention Medical’s Advanced Technologies business (“Vention”), which are all included within the Advanced Technology Systems segment.

We had one acquisition during 2016, LinkTech, which is also included within the Advanced Technology Systems segment.

Sales of the Adhesive Dispensing Systems segment were $916,019 in 2017, an increase of $36,446, or 4.1 percent, from 2016 sales of $879,573.

Sales of the Advanced Technology Systems segment were $897,623 in 2017, an increase of $221,294 or 32.7 percent, from 2016 sales of $676,329.

Organic volume increased in most product lines, and was driven by demand in electronics and medical end markets.

Sales of the Industrial Coating Systems segment were $253,340 in 2017, an increase of $248, or 0.1 percent, from 2016 sales of $253,092.

Within this segment, sales volume increased in Europe, Japan and the Americas regions.

Sales volume increased in most product lines, and was driven by demand for liquid and UV curing, powder coating and container product lines serving industrial end markets.

Sales in Europe were $530,812, an

increase of 5.3 percent from 2016, with volume increasing 5.5 percent partially offset by unfavorable currency effects of 0.2 percent.

Operating profit – Cost of sales were $927,981 in 2017, up 13.8 percent from $815,495 in 2016.

Of the 0.2 percentage point improvement in gross margin, favorable product mix added 0.3 percentage points primarily related to higher sales growth in our Adhesive Dispensing Systems and Advanced Technology Systems segments, which have higher margins than the Industrial Coating Systems segment.

Selling and administrative expenses were $678,861 in 2017, compared to $594,293 in 2016.

The 14.2 percentage point increase includes 6.1 percent primarily in support of higher sales growth, 6.1 percent related to the first year effect of acquisitions and 2.5 percent of corporate charges related to acquisition transaction costs, offset by 0.5 percentage points due to currency translation effects.

Of the 0.1 percentage point improvement, 2.5 percentage points is due to leveraging higher sales growth in our Adhesive Dispensing Systems and Advanced Technology Systems segments.

This improvement was partially offset by 1.7 percentage points due to the first year effect of acquisitions and 0.7 percentage points due to corporate charges related to acquisition transaction costs.

Within the Advanced Technology Systems segment, costs of $180 were reversed during 2017 related to a 2015 restructuring initiative.

No costs related to severance and restructuring were recorded in the Industrial Coating Systems segment in 2017.

Of the 0.6 percentage point improvement in operating margin, favorable leverage of our selling and administrative expenses contributed 2.4 percentage points, lower severance and restructuring expenses added 0.5 percentage points, and favorable product mix added 0.2 percentage points primarily related to higher sales growth in our Adhesives Dispensing Systems and Advanced Technology Systems segments.

This improvement was offset by 1.7 percentage points due to the first year effect of acquisitions, 0.7 percentage points due to corporate charges related to acquisition transaction costs, and 0.1 percentage points due to short term purchase price accounting charges for acquired inventory.

Of the 1.6 percentage point improvement in operating margin, favorable product mix added 0.7 percentage points due to increased sales to consumer non-durable, disposable hygiene and rigid packaging end markets, lower severance and restructuring expenses added 0.6 percentage points, favorable foreign currency translation effects added 0.2 percentage points and favorable leverage of selling and administrative expenses added 0.1 percentage points.

Translation of foreign currency financial statements and foreign currency transactions – Our reporting currency is the U.S. dollar.

However, the functional currency for each of our foreign subsidiaries is its principal operating currency.

We translate the amounts included in our Consolidated Statements of Income from our foreign subsidiaries into U.S. dollars at weighted-average exchange rates, which we believe are representative of the actual exchange rates on the dates of the transactions.

Our foreign subsidiaries’ assets and liabilities are translated into U.S. dollars from local currency at the actual exchange rates as of the end of each reporting date, and we record the resulting foreign exchange translation adjustments in our Consolidated Balance Sheets as a component of accumulated other comprehensive income (loss).

If the U.S. dollar strengthens, we reflect the resulting losses as a component of accumulated other comprehensive income (loss).

Conversely, if the U.S. dollar weakens, foreign exchange translation gains result, which favorably impact accumulated other comprehensive income (loss).

Translation adjustments may be included in net earnings in the event of a sale or liquidation of certain of our underlying foreign investments.

If we determine that the functional currency of any of our foreign subsidiaries should be the U.S. dollar, our financial statements will be affected.

Should this occur, we will adjust our reporting to appropriately account for any such changes.

As appropriate, we use permanently invested intercompany loans as a source of capital to reduce exposure to foreign currency fluctuations at our foreign subsidiaries.

These loans, on a consolidated basis, are treated as being analogous to equity for accounting purposes.

Therefore, foreign exchange gains or losses on these intercompany loans are recorded in accumulated other comprehensive income (loss).

The goodwill impairment test is a two-step process.

In the first step, performed in the fourth quarter of each year, we estimate a reporting unit’s fair value using a combination of the discounted cash flow method of the Income Approach and the guideline public company method of the Market Approach and compare the result against the reporting unit’s carrying value of net assets.

If the carrying value of a reporting unit exceeds its fair value, then a second step is performed to determine if goodwill is impaired.

We use an independent valuation specialist to assist with

Nordson Corporation 20

In 2016 and 2015, the results of our step one testing indicated no impairment; therefore, the second step of impairment testing was not necessary.

The table above does not include acquisitions that occurred after the August 1 measurement date but before our fiscal year-end.

We acquired LinkTechTM Quick Couplings, Inc. (“LinkTech”) on September 1, 2016.

Determination of the preliminary goodwill associated with this acquisition was completed with the assistance of an independent valuation specialist in the fourth quarter of 2016.

Since the date of the valuation, no events or changes in circumstances have occurred that would more likely than not reduce the fair value of the acquisition below its carrying value.

For future valuation purposes, LinkTech will be included in the Advanced Technology Systems – Fluid Management reporting unit.

Other long-lived assets – We test other depreciable and amortizable long-lived assets for recoverability in accordance with ASC 360 using undiscounted cash flows if indicators of impairment exist.

The total carrying value of long-lived assets for each reporting unit is compared to the forecasted cash flows of each reporting unit’s long-lived assets being tested.

Cash flows have been defined as earnings before interest, taxes, depreciation, and amortization, less annual maintenance capital spending.

Nordson Corporation 21

Inventories - Inventories are valued at the lower of cost or market.

Cost was determined using the last-in, first-out (LIFO) method for 20 percent of consolidated inventories at October 31, 2016 and October 31, 2015, with the first-in, first-out (FIFO) method used for the remaining inventory.

On an ongoing basis, inventory is tested for technical obsolescence, as well as for future demand and changes in market conditions.

We have historically maintained inventory reserves to reflect those conditions when the cost of inventory is not expected to be recovered.

Reserves are also maintained for inventory used for demonstration purposes.

The inventory reserve balance was $29,324, $28,230 and $26,744 at October 31, 2016, 2015 and 2014, respectively.

| Effect on pension obligation as of October 31, 2016 | | $ | (54,984 | ) | | $ | 69,133 | | | $ | (15,416 | ) | | $ | 19,961 | |

| Effect on pension obligation as of October 31, 2016 | | $ | 21,485 | | | $ | (13,463 | ) | | $ | 3,626 | | | $ | (3,289 | ) |

| Effect on postretirement obligation as of October 31, 2016 | | $ | (10,287 | ) | | $ | 12,776 | | | $ | (94 | ) | | $ | 123 | |

| Effect on postretirement obligation as of October 31, 2016 | | $ | 11,024 | | | $ | (8,836 | ) | | $ | 146 | | | $ | (113 | ) |

Pension and postretirement expenses in 2017 are expected to be approximately $1,211 lower than 2016, primarily due to the adoption of the spot rate approach as noted above.

Financial instruments - Assets, liabilities and commitments that are to be settled in cash and are denominated in foreign currencies are sensitive to changes in currency exchange rates.

We enter into foreign currency forward contracts, which are derivative financial instruments, to reduce the risk of foreign currency exposures resulting from the collection of receivables, payables and loans denominated in foreign currencies.

As a result of the use of foreign exchange contracts on a routine basis to reduce the risks related to most of our transactions denominated in foreign currencies, as of October 31, [removed: 2016,] [added: 2017,] we did not have material foreign currency exposure.

| At October 31, [removed: 2015] [added: 2017] | | | | | | | | | | | | | | | | | | | | | | | | | | Total | | | | Fair | | |

| | | [removed: 2016] [added: 2018] | | | | [removed: 2017] [added: 2019] | | | | [removed: 2018] [added: 2020] | | | | [removed: 2019] [added: 2021] | | | | [removed: 2020] [added: 2022] | | | | Thereafter | | | | Value | | | | Value | | |

| Average interest rate on total borrowings outstanding during the year | | | 2.9 | % | | | [removed: 2.7] [added: 3.0] | % | | | [removed: 2.7] [added: 3.0] | % | | | [removed: 2.8] [added: 3.1] | % | | | [removed: 2.8] [added: 3.1] | % | | | [removed: 3.0] [added: 3.1] | % | | | [removed: 2.7] [added: 2.9] | % | | | | |

The weighted average interest rate of this debt was [removed: 1.6] [added: 2.3] percent at October 31, [removed: 2016] [added: 2017] and [removed: 1.2] [added: 1.6] percent at October 31, [removed: 2015.][added: 2016.]

A one percent increase in interest rates would have resulted in additional interest expense of approximately [removed: $7,205] [added: $11,064] on the variable rate notes payable and long-term debt in [removed: 2016.][added: 2017.]

| Annual repayments of long-term debt | | $ | 26,586 | | | $ | 28,734 | | | $ | 68,738 | | | $ | 38,187 | | | $ | 30,791 | | | $ | 127,448 | | | $ | 320,484 | | | $ | 324,965 | |

Nordson Corporation 34

| Annual repayments of long-term debt | | $ | 11,340 | | | $ | 38,093 | | | $ | 26,587 | | | $ | 28,734 | | | $ | 68,738 | | | $ | 196,425 | | | $ | 369,917 | | | $ | 365,572 | |

Consistent with this global strategy, approximately [removed: 71] [added: 69] percent of our revenues were generated outside the United States in [removed: 2016.][added: 2017.]

We have [removed: 6,127] [added: 7,532] employees worldwide.

Principal manufacturing facilities are located in the United States, the People’s Republic of China, Germany, [added: Ireland, Israel,] Mexico, the Netherlands, Thailand and the United Kingdom.

We strive to provide genuine customer [removed: satisfaction;] [added: satisfaction –] it is the foundation upon which we continue to build our business.

In accordance with generally accepted accounting [removed: standards,] [added: principles,] we have reported information about our three operating segments, including information about our foreign and domestic operations.

| | • | Product Assembly – Dispensing, coating and laminating systems for the assembly of plastic, metal and wood products, for paper and paperboard converting applications and for the manufacturing of continuous roll goods. Key [removed: strategic markets include appliances, automotive components, building and construction materials, electronics, furniture, solar energy, and the manufacturing of bags, sacks, books, envelopes and folding cartons.] |

| | • | [removed: Electronic] [added: Electronics] Systems - Automated dispensing systems for high-speed, accurate application of a broad range of attachment, protection and coating fluids, and related gas plasma treatment systems for cleaning and conditioning surfaces prior to dispense. Key strategic markets include mobile phones, tablets, personal computers, wearable technology, liquid crystal displays, micro hard drives, microprocessors, printed circuit boards, micro-electronic mechanical systems (MEMS), and semiconductor packaging. |

| | • | Fluid Management – Precision manual and semi-automated dispensers, [added: minimally invasive interventional delivery devices, and] highly engineered single-use plastic molded syringes, cartridges, tips, fluid connection components, tubing and catheters. Products are used for applying and controlling the flow of adhesives, sealants, lubricants, and biomaterials in critical industrial production processes and within medical equipment and related surgical procedures. Key strategic markets include consumer goods, electronics, industrial assembly, and medical. |

We have principal manufacturing operations and sources of supply in the United States in Ohio, Georgia, California, Colorado, [added: Connecticut, Massachusetts,] Michigan, [added: Minnesota,] New Jersey, North Carolina, [removed: Pennsylvania,] Rhode Island, [removed: Virginia] [added: Tennessee, Washington] and Wisconsin; as well as in the People’s Republic of China, Germany, [added: Ireland, Israel,] Mexico, the Netherlands, Thailand and the United Kingdom.

Senior operating [removed: executives] [added: management] supervise an extensive quality control program for our equipment, machinery and systems, and manufacturing processes.

As of October 31, [removed: 2016,] [added: 2017,] we held [removed: 541] [added: 597] United States patents and [removed: 1,207] [added: 1,413] foreign patents and had [removed: 212] [added: 218] United States patent applications pending and [removed: 878] [added: 868] foreign patent applications pending, but there is no assurance that any patent application will be issued.

Patents covering individual products extend for varying periods according to the date of filing or grant and [added: the] legal term of patents in various countries where a patent is obtained.

Our current patent portfolio has expiration dates ranging from November [removed: 2016] [added: 2017] to [removed: February 2041.][added: April 2042.]

We also own a number of trademarks in the United States and foreign countries, including registered trademarks for Nordson, Asymtek, [added: Avalon,] Dage, EFD, Value [removed: Plastics,] [added: Plastics] and Xaloy and various common law trademarks which are important to our business, inasmuch as they identify Nordson and our products to our customers.

As of October 31, [removed: 2016,] [added: 2017,] we had a total of [removed: 2,084] [added: 2,428] trademark registrations in the United States and in various foreign countries.

In [removed: 2016,] [added: 2017,] no single customer accounted for ten percent or more of sales.

Our backlog of open orders increased to approximately [removed: $274,000] [added: $402,000] at October 31, [removed: 2016] [added: 2017] from approximately [removed: $228,000] [added: $278,000] at October 31, [removed: 2015.][added: 2016, inclusive of approximately 28.0 percent organic growth and 17.0 percent growth due to acquisitions.]

The amounts for both years were calculated based upon exchange rates in effect at October 31, [removed: 2016.][added: 2017.]

The increase is primarily due to [removed: orders] [added: growth] within the Advanced Technology Systems segment.

All orders in the [removed: 2016] [added: 2017] year-end backlog are expected to be shipped to customers in [removed: 2017.][added: 2018.]

Research and development expenses were [removed: approximately $46,247] [added: $52,462] in [removed: 2016,] [added: 2017,] compared with [removed: approximately $46,689] [added: $46,247] in [removed: 2015] [added: 2016] and [removed: $47,536] [added: $46,689] in [removed: 2014.][added: 2015.]

As a percentage of sales, research and development expenses were [removed: approximately 2.6, 2.8] [added: 2.5, 2.6] and 2.8 percent in [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014,] [added: 2015,] respectively.

Compliance with federal, state, local and foreign environmental protection laws during [removed: 2016] [added: 2017] had no material effect on our capital expenditures, earnings or competitive position.

As of October 31, [removed: 2016,] [added: 2017,] we had [removed: 6,127] [added: 7,532] full-time and part-time employees, including [removed: 149] [added: 140] at our Amherst, Ohio, facility who are represented by a collective bargaining agreement that expires on [removed: November 3,] [added: October 31,] 2019 and [removed: 37] [added: 32] at our New Castle, Pennsylvania facility who are represented by [added: a] collective bargaining agreements that [removed: expire] [added: expired] on August 31, 2017.

Vention Acquisition

On March 31, 2017, we completed the acquisition of Vention Medical’s Advanced Technologies (“Vention”) business by means of a merger.

Vention is a leading designer, developer and manufacturer of minimally invasive interventional delivery devices, catheters and advanced components for the global medical technology market.

Pursuant to the terms of the merger agreement governing the acquisition, we acquired Vention, excluding all of the outstanding capital stock of Vention Medical, Inc. (“Vention Medical”), and certain subsidiaries of Vention Medical that were sold to a third party prior to the effective time of the merger, on a cash-free and debt-free basis for an aggregate purchase price of $716.5 million, subject to certain adjustments (including a customary working capital adjustment), resulting in a transaction with an approximate enterprise value of $705 million.

| | | strategic markets include appliances, automotive components, building and construction materials, electronics, furniture, solar energy, and the manufacturing of bags, sacks, books, envelopes and folding cartons. |

| --- | --- | --- |

As previously announced, our New Castle, Pennsylvania facility will be closing, and the parties to the collective bargaining agreement, which expired on August 31, 2017, agreed it shall remain in effect until the planned facility closure, at which point the collective bargaining agreement shall immediately expire.

At October 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] our accrual for the ongoing operation, maintenance and monitoring obligation at the Site was [removed: $516] [added: $472] and [removed: $565,] [added: $516,] respectively.

10-K 1 [removed: ndsn-10k_20161031.htm NDSN-10K-20161031][added: ndsn-10k_20171031.htm 10-K]

For the fiscal year ended October 31, [removed: 2016][added: 2017]

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated [removed: filer or] [added: filer,] a smaller reporting [added: company or an emerging growth] company.

See definition of “large accelerated filer,” “accelerated [removed: filer” and] [added: filer,”] “smaller reporting company” [added: and “emerging growth company”] in Rule 12b-2 of the Exchange Act.

The aggregate market value of Common Shares, no par value per share, held by nonaffiliates (based on the closing sale price on the Nasdaq Stock Market) as of April 30, [removed: 2016] [added: 2017] was approximately [removed: $4,357,415,366.][added: $7,182,626,437.]

There were [removed: 57,348,873] [added: 57,745,608] Common Shares outstanding as of November 30, [removed: 2016.][added: 2017.]

Documents incorporated by reference: Portions of the Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting - Part III

| Item 1B. | | [Unresolved Staff Comments](#ITEM_1B_UNRESOLVED_STAFF_COMMENTS) | [removed: 14] [added: 15] |

| Item 2. | | [Properties](#ITEM_2_PROPERTIES) | [removed: 15] [added: 16] |

| Item 3. | | [Legal Proceedings](#ITEM_3_LEGAL_PROCEEDINGS) | [removed: 16] [added: 17] |

| Item 4. | | [Mine Safety Disclosures](#ITEM_4_MINE_SAFETY_DISCLOSURES) | [removed: 16] [added: 17] |

| | | [Executive Officers of the Company](#EXECUTIVE_FICERS__COMPANY) | [removed: 16] [added: 17] |

| [PART II](#PART_II) | | | [removed: 17] [added: 19] |

| Item 5. | | [Market for the Company’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#ITEM_5_MARKET_FOR_COMPANYS_COMMON_EQUITY) | [removed: 17] [added: 19] |

| | | [Market Information and Dividends](#MARKET_INFORMATION_DIVIDENDS) | [removed: 17] [added: 19] |

| | | [Performance Graph](#PERFORMANCE_GRAPH) | [removed: 17] [added: 20] |

| Item 6. | | [Selected Financial Data](#ITEM_6_SELECTED_FINANCIAL_DATA) | [removed: 19] [added: 21] |

| Item 7. | | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#ITEM_7_MANAGEMENTS_DISCUSSION_ANALYSIS_F) | [removed: 20] [added: 22] |

| | | [Critical Accounting Policies and Estimates](#CRITICAL_ACCOUNTING_POLICIES_ESTIMATES) | [removed: 20] [added: 22] |

| Item 8. | | [Financial Statements and Supplementary Data](#ITEM_8_FINANCIAL_STATEMENTS_SUPPLEMENTAR) | [removed: 34] [added: 35] |

| | | [Consolidated Statements of Income](#CONSOLIDATED_STATEMENTS_INCOME) | [removed: 34] [added: 35] |

| | | [Consolidated Statements of Comprehensive Income](#CONSOLIDATED_STATEMENTS_COMPREHENSIVE_IN) | [removed: 35] [added: 36] |

| | | [Consolidated Balance Sheets](#CONSOLIDATED_BALANCE_SHEETS) | [removed: 36] [added: 37] |

| | | [Consolidated Statements of Shareholders’ Equity](#CONSOLIDATED_STATEMENTS_SHAREHOLDERS_EQU) | [removed: 37] [added: 38] |

| | | [Consolidated Statements of Cash Flows](#CONSOLIDATED_STATEMENTS_CASH_FLOWS) | [removed: 38] [added: 39] |

| | | [Notes to Consolidated Financial Statements](#NOTES_TO_CONSOLIDATED_FINANCIAL_STATEMEN) | [removed: 39] [added: 40] |

| | | [Management’s Report on Internal Control Over Financial Reporting](#MANAGEMENTS_REPORT_ON_INTERNAL_CONTROL_O) | [removed: 68] [added: 70] |

| | | [Report of Independent Registered Public Accounting Firm](#REPORT_INDEPENDENT_REGISTERED_PUBLIC_ACC) | [removed: 69] [added: 71] |

| | | [Report of Independent Registered Public Accounting Firm](#Report_of_Independent) | [removed: 70] [added: 72] |

| Item 9. | | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#ITEM_9_CHANGES_IN_DISAGREEMENTS_WITH_ACC) | [removed: 71] [added: 73] |

| Item 9A. | | [Controls and Procedures](#ITEM_9A_CONTROLS_PROCEDURES) | [removed: 71] [added: 73] |

| Item 9B. | | [Other Information](#ITEM_9B_OR_INFORMATION) | [removed: 71] [added: 73] |

| [PART III](#PART_III) | | | [removed: 72] [added: 74] |

| Item 10. | | [Directors, Executive Officers and Corporate Governance](#ITEM_10_DIRECTORS_EXECUTIVE_FICERS_CORPO) | [removed: 72] [added: 74] |

| Item 11. | | [Executive Compensation](#ITEM_11_EXECUTIVE_COMPENSATION) | [removed: 72] [added: 74] |

| Item 12. | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#ITEM_12_SECURITY_OWNERSHIP_CERTAIN_BENEF) | [removed: 72] [added: 74] |

| | | [Equity Compensation Table](#EQUITY_COMPENSATION_TABLE) | [removed: 72] [added: 74] |

| Item 13. | | [Certain Relationships and Related Transactions, and Director Independence](#ITEM_13_CERTAIN_RELATIONSHIPS_RELATED_TR) | [removed: 72] [added: 74] |

| Item 14. | | [Principal Accountant Fees and Services](#ITEM_14_PRINCIPAL_ACCOUNTANT_FEES_SERVIC) | [removed: 72] [added: 75] |

| [PART IV](#PART_IV) | | | [removed: 73] [added: 76] |

| Emerging growth company | ☐ | | |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

| Item 16. | | [Form 10-K Summary](#ITEM_16_FORM_10K_SUMMARY) | 80 |

Nordson Corporation [removed: 14][added: 15]

The following table summarizes our principal properties as of October 31, [removed: 2016:][added: 2017:]

| [removed: Pulaski, Virginia 1] [added: Spokane, Washington 2] | | A manufacturing, warehouse and office building | | [removed: 101,000] [added: 18,000] |

| [added: Salem,] New [removed: Castle, Pennsylvania 1] [added: Hampshire 2] | | A manufacturing, warehouse and office building [added: (leased)] | | [removed: 76,000] [added: 63,000] |

| [removed: Rancho Dominguez,] [added: Concord,] California 2 | | A manufacturing and office building (leased) | | [removed: 40,000] [added: 12,000] |

| [removed: Plymouth,] [added: Wixom,] Michigan 3 | | [removed: Two] [added: A] manufacturing, warehouse and office [removed: buildings] [added: building] (leased) | | [removed: 35,000] [added: 64,000] |

| [removed: Concord,] [added: Ventura,] California 2 | | A [removed: manufacturing] [added: manufacturing, warehouse] and office building (leased) | | 11,000 |

| [removed: San Diego, California] [added: Chattanooga, Tennessee] 2 | | A [removed: manufacturing] [added: manufacturing, warehouse] and office building (leased) | | [removed: 7,000] [added: 25,000] |

| Guaymas, Mexico 2 | | [removed: Two] [added: Three] manufacturing, warehouse and office buildings (leased) | | [removed: 71,000] [added: 89,000] |

| [removed: Temse, Belgium 1] [added: Boyle, Ireland 2] | | A manufacturing, warehouse and office building (leased) | | [removed: 43,000] [added: 47,000] |

Nordson Corporation [removed: 15][added: 16]

| Austintown, Ohio 1 | | A manufacturing, warehouse and office building (leased) | | 207,000 |

| Norwich, Connecticut 2 | | A manufacturing, laboratory and office building | | 159,000 |

| Minneapolis, Minnesota 2 | | Two office, laboratory and warehouse buildings (leased) | | 69,000 |

| Marlborough, Massachusetts 2 | | An office, laboratory and warehouse building (leased) | | 30,000 |

| Sunnyvale, California 2 | | Two office, laboratory and warehouse buildings (leased) | | 24,000 |

| Huntington Beach, California 2 | | An office, laboratory and warehouse building | | 21,000 |

| Munich, Germany 2 | | Three office, laboratory and warehouse buildings (leased) | | 29,000 |

| Katzrin, Israel 2 | | An office, laboratory and warehouse building (leased) | | 20,000 |

Our executive officers as of October 31, [removed: 2016,] [added: 2017,] were as follows:

| Michael F. Hilton | | [removed: 62] [added: 63] | | 2010 | | President and Chief Executive Officer, 2010 |

| John J. Keane | | [removed: 55] [added: 56] | | 2003 | | Senior Vice President, 2005 |

| Gregory P. Merk | | [removed: 45] [added: 46] | | 2006 | | Senior Vice President, 2013 |

| Gregory A. Thaxton | | [removed: 55] [added: 56] | | 2007 | | Senior Vice President, Chief Financial Officer, 2012 |

| James E. DeVries | | [removed: 57] [added: 58] | | 2012 | | Vice President, 2012 |

| Shelly M. Peet | | [removed: 51] [added: 52] | | 2007 | | Vice President, 2009 |

| Jeffrey A. Pembroke | | [removed: 49] [added: 50] | | 2015 | | Vice President, 2015 |

| Joseph Stockunas | | [removed: 56] [added: 57] | | 2015 | | Vice President, 2015 |

| Robert E. Veillette | | [removed: 64] [added: 65] | | 2007 | | Vice President, General Counsel and Secretary, 2007 |

Nordson Corporation [removed: 16][added: 17]

| Stephen P. Lovass | | 48 | | 2017 | | Vice President, 2017 |

| --- | --- | --- | --- | --- | --- | --- |

On November 28, 2016, Mr. Lovass was elected as Corporate Vice President.

Prior to joining the Company, Mr. Lovass served as President for one of the global sensors and controls businesses for Danahar Corporation, a publicly-traded, international Fortune 200, diversified science and technology company from 2012 to 2016.

Prior to joining Danahar, Mr. Lovass served as a Senior Vice President and Corporate Officer for Gerber Scientific.

On September 5, 2017, we filed a Form 8-K with the Securities & Exchange Commission announcing that Mr. Veillette will retire from the Company, effective December 31, 2017.

Upon his retirement, Mr. Veillette will be succeeded by Gina Brickley Beredo who has served as Deputy General Counsel and Assistant Secretary since joining the Company in 2013.

Nordson Corporation 18

| | | | | | | Vice President, Chief Financial Officer, 2008 |

| Douglas C. Bloomfield | | 57 | | 2005 | | Vice President, 2005 |

| | | | | | | Vice President, Global Continuous Improvement, 2011 |

As of November 30, [removed: 2016,] [added: 2017,] there were [removed: 1,494] [added: 1,466] registered shareholders.

The table below is a summary of dividends paid per common share and the range of high and low sales prices during each quarter of [removed: 2016] [added: 2017] and [removed: 2015.][added: 2016.]

The following is a graph that compares the [removed: five-year] [added: 10-year] cumulative return, calculated on a dividend-reinvested basis, from investing $100 on November 1, [removed: 2011] [added: 2007] in Nordson common shares, the S&P 500 Index, the S&P MidCap 400 Index, the S&P 500 Industrial Machinery Index, the S&P MidCap 400 Industrial Machinery Index and our Proxy Peer Group, which includes: AIN, AME, ATU, B, CLC, DCI, ENTG, ESL, FLIR, GGG, GTLS, IEX, ITT, LECO, ROP, TER, WTS, and WWD.

[removed: ][added: ]

Nordson Corporation [removed: 17][added: 19]

| Company/Market/Peer Group | [added: 2007 | | | 2008 | | | 2009 | | | 2010 | | |] 2011 | | | 2012 | | | 2013 | | | 2014 | | | 2015 | | | [added: |] 2016 | | | [added: 2017 | |]

| | | [removed: Repurchased] [added: Repurchased(1)] | | | | per Share | | | | or [removed: Programs] [added: Programs(2)] | | | | the Plans or Programs | | |

| August 1, [removed: 2016] [added: 2017] to August 31, [removed: 2016] [added: 2017] | | | [removed: —] [added: 1] | | | $ | [removed: —] [added: 108.84] | | | | — | | | $ | 118,971 | |

| September 1, [removed: 2016] [added: 2017] to September 30, [removed: 2016] [added: 2017] | | | — | | | $ | — | | | | — | | | $ | 118,971 | |

| October 1, [removed: 2016] [added: 2017] to October 31, [removed: 2016] [added: 2017] | | | — | | | $ | — | | | | — | | | $ | 118,971 | |

| Total | | | [removed: —] [added: 1] | | | | | | | | — | | | | | |

[added: | | | options, restricted stock and 401(k) matching. Shares purchased are treated as treasury shares until used for such purposes.] The repurchase program is being funded using cash from operations and proceeds from borrowings under our credit facilities. [added: |]

Nordson Corporation [removed: 18][added: 20]

| 2017: | | | | | | | | | | | | |

| First | | $ | .27 | | | $ | 116.01 | | | $ | 96.05 | |

| Second | | | .27 | | | | 127.50 | | | | 112.23 | |

| Third | | | .27 | | | | 131.49 | | | | 113.69 | |

| Fourth | | | .30 | | | | 130.41 | | | | 107.16 | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Nordson Corporation | $ | 100.00 | | $ | 70.90 | | $ | 105.80 | | $ | 160.42 | | $ | 194.33 | | $ | 252.55 | | $ | 311.36 | | $ | 334.00 | | $ | 314.64 | | $ | 448.10 | | $ | 572.29 | |

| S&P 500 Index | $ | 100.00 | | $ | 63.90 | | $ | 70.17 | | $ | 81.76 | | $ | 88.37 | | $ | 101.81 | | $ | 129.48 | | $ | 151.84 | | $ | 159.73 | | $ | 166.93 | | $ | 206.38 | |

| S&P MidCap 400 | $ | 100.00 | | $ | 63.54 | | $ | 75.09 | | $ | 95.84 | | $ | 104.03 | | $ | 116.63 | | $ | 155.68 | | $ | 173.82 | | $ | 179.77 | | $ | 191.02 | | $ | 235.87 | |

| S&P 500 Ind. Machinery | $ | 100.00 | | $ | 57.23 | | $ | 76.58 | | $ | 97.99 | | $ | 101.38 | | $ | 121.33 | | $ | 173.25 | | $ | 195.37 | | $ | 195.07 | | $ | 222.74 | | $ | 307.08 | |

| S&P MidCap 400 Ind. Machinery | $ | 100.00 | | $ | 57.90 | | $ | 71.57 | | $ | 93.02 | | $ | 105.80 | | $ | 115.55 | | $ | 160.42 | | $ | 170.00 | | $ | 142.30 | | $ | 167.01 | | $ | 239.53 | |

| Proxy Peer Group | $ | 100.00 | | $ | 67.28 | | $ | 72.96 | | $ | 89.87 | | $ | 100.94 | | $ | 115.31 | | $ | 160.25 | | $ | 176.57 | | $ | 169.73 | | $ | 174.34 | | $ | 261.11 | |

| | (1) | Includes shares tendered for taxes related to vesting of restricted stock. |

| --- | --- | --- |

| | (2) | In December 2014, the board of directors authorized a new $300,000 common share repurchase program. This program replaced the $200,000 program approved by the board in August 2013. In August 2015, the board of directors authorized the repurchase of up to an additional $200,000 of the Company’s common shares. This new authorization added capacity to the board’s December 2014 authorization to repurchase $300,000 of shares. Approximately $118,971 remained available for share repurchases at October 31, 2017. Uses for repurchased shares include the funding of benefit programs including stock |

| --- | --- | --- |

| --- | --- | --- |

| 2015: | | | | | | | | | | | | |

| First | | $ | .22 | | | $ | 80.42 | | | $ | 71.58 | |

| Second | | | .22 | | | | 81.05 | | | | 72.10 | |

| Third | | | .22 | | | | 84.45 | | | | 71.75 | |

| Fourth | | | .24 | | | | 75.95 | | | | 58.52 | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Nordson Corporation | $ | 100.00 | | $ | 129.96 | | $ | 160.22 | | $ | 171.87 | | $ | 161.91 | | $ | 230.59 | |

| S&P 500 Index | $ | 100.00 | | $ | 115.21 | | $ | 146.52 | | $ | 171.82 | | $ | 180.75 | | $ | 188.90 | |

| S&P MidCap 400 | $ | 100.00 | | $ | 112.11 | | $ | 149.64 | | $ | 167.08 | | $ | 172.80 | | $ | 183.61 | |

| S&P 500 Ind. Machinery | $ | 100.00 | | $ | 119.68 | | $ | 170.88 | | $ | 192.70 | | $ | 192.41 | | $ | 219.70 | |

| S&P MidCap 400 Ind. Machinery | $ | 100.00 | | $ | 109.21 | | $ | 151.63 | | $ | 160.68 | | $ | 134.50 | | $ | 157.85 | |

| Proxy Peer Group | $ | 100.00 | | $ | 113.38 | | $ | 157.20 | | $ | 173.54 | | $ | 165.40 | | $ | 173.92 | |

In December 2014, the board of directors authorized a new $300,000 common share repurchase program.

This program replaced the $200,000 program approved by the board in August 2013.

In August 2015, the board of directors authorized the repurchase of up to an additional $200,000 of the Company’s common shares.

This new authorization added capacity to the board’s December 2014 authorization to repurchase $300,000 of shares.

Approximately $118,971 remained available for share repurchases at October 31, 2016.

Uses for repurchased shares include the funding of benefit programs including stock options, restricted stock and 401(k) matching.

Shares purchased are treated as treasury shares until used for such purposes.

| | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Sales | | $ | [removed: 1,808,994] [added: 2,066,982] | | | $ | [removed: 1,688,666] [added: 1,808,994] | | | $ | [removed: 1,704,021] [added: 1,688,666] | | | $ | [removed: 1,542,921] [added: 1,704,021] | | | $ | [removed: 1,409,578] [added: 1,542,921] | |

| Cost of sales | | | [removed: 815,495] [added: 927,981] | | | | [removed: 774,702] [added: 815,495] | | | | [removed: 758,923] [added: 774,702] | | | | [removed: 676,777] [added: 758,923] | | | | [removed: 586,289] [added: 676,777] | |

| % of sales | | | 45 | | | | [removed: 46] [added: 45] | | | | [removed: 45] [added: 46] | | | | [removed: 44] [added: 45] | | | | [removed: 42] [added: 44] | |

| Selling and administrative expenses | | | [removed: 594,293] [added: 678,861] | | | | [removed: 584,823] [added: 594,293] | | | | [removed: 575,442] [added: 584,823] | | | | [removed: 541,169] [added: 575,442] | | | | [removed: 485,285] [added: 541,169] | |

| % of sales | | | 33 | | | | [removed: 35] [added: 33] | | | | [removed: 34] [added: 35] | | | | [removed: 35] [added: 34] | | | | [removed: 34] [added: 35] | |

| Severance and restructuring costs | | | [removed: 10,775] [added: 2,438] | | | | [removed: 11,411] [added: 10,775] | | | | [removed: 2,551] [added: 11,411] | | | | [removed: 1,126] [added: 2,551] | | | | [removed: 2,524] [added: 1,126] | |

| Operating profit | | | [removed: 388,431] [added: 457,702] | | | | [removed: 317,730] [added: 388,431] | | | | [removed: 367,105] [added: 317,730] | | | | [removed: 323,849] [added: 367,105] | | | | [removed: 335,480] [added: 323,849] | |

| % of sales | | | [removed: 21] [added: 22] | | | | [removed: 19] [added: 21] | | | | [removed: 22] [added: 19] | | | | [removed: 21] [added: 22] | | | | [removed: 24] [added: 21] | |

| Net income | | | [removed: 271,843] [added: 295,802] | | | | [removed: 211,111] [added: 271,843] | | | | [removed: 246,773] [added: 211,111] | | | | [removed: 221,817] [added: 246,773] | | | | [removed: 224,829] [added: 221,817] | |

| % of sales | | | [removed: 15] [added: 14] | | | | [removed: 13] [added: 15] | | | | [removed: 14] [added: 13] | | | | 14 | | | | [removed: 16] [added: 14] | |

| Financial Data (a) [added: (e)] | | | | | | | | | | | | | | | | | | | | |

| Working capital | | $ | [removed: 414,032] [added: 240,626] | | | $ | [removed: 420,815] [added: 414,032] | | | $ | [removed: 301,815] [added: 420,815] | | | $ | [removed: 365,269] [added: 301,815] | | | $ | [removed: 242,939] [added: 365,269] | |

| Shareholders’ equity | | | [removed: 851,603] [added: 1,155,493] | | | | [removed: 660,016] [added: 851,603] | | | | [removed: 904,797] [added: 660,016] | | | | [removed: 887,863] [added: 904,797] | | | | [removed: 669,770] [added: 887,863] | |

| Return on average total capital — % (c) | | | [removed: 16] [added: 14] | | | | [removed: 13] [added: 16] | | | | [removed: 17] [added: 13] | | | | [removed: 18] [added: 17] | | | | [removed: 23] [added: 18] | |

| Return on average shareholders’ equity — % (d) | | | [removed: 37] [added: 30] | | | | [removed: 26] [added: 37] | | | | [removed: 27] [added: 26] | | | | [removed: 29] [added: 27] | | | | [removed: 38] [added: 29] | |

| Average number of common shares | | | [removed: 57,060] [added: 57,533] | | | | [removed: 60,652] [added: 57,060] | | | | [removed: 63,656] [added: 60,652] | | | | [removed: 64,214] [added: 63,656] | | | | [removed: 64,407] [added: 64,214] | |

| Average number of common shares and common share equivalents | | | [removed: 57,530] [added: 58,204] | | | | [removed: 61,151] [added: 57,530] | | | | [removed: 64,281] [added: 61,151] | | | | [removed: 64,908] [added: 64,281] | | | | [removed: 65,103] [added: 64,908] | |

| Basic earnings per share | | $ | [removed: 4.76] [added: 5.14] | | | $ | [removed: 3.48] [added: 4.76] | | | $ | [removed: 3.88] [added: 3.48] | | | $ | [removed: 3.45] [added: 3.88] | | | $ | [removed: 3.49] [added: 3.45] | |

| Diluted earnings per share | | | [removed: 4.73] [added: 5.08] | | | | [removed: 3.45] [added: 4.73] | | | | [removed: 3.84] [added: 3.45] | | | | [removed: 3.42] [added: 3.84] | | | | [removed: 3.45] [added: 3.42] | |

| Dividends per common share | | | [removed: 0.99] [added: 1.11] | | | | [removed: 0.90] [added: 0.99] | | | | [removed: 0.76] [added: 0.90] | | | | [removed: 0.63] [added: 0.76] | | | | [removed: 0.525] [added: 0.63] | |

| Book value per common share | | | [removed: 14.85] [added: 20.02] | | | | [removed: 11.51] [added: 14.86] | | | | [removed: 14.49] [added: 11.51] | | | | [removed: 13.83] [added: 14.49] | | | | [removed: 10.42] [added: 13.83] | |

Nordson Corporation [removed: 19][added: 21]

| Net property, plant and equipment and other non-current assets | | | 2,526,167 | | | | 1,675,008 | | | | 1,646,723 | | | | 1,606,274 | | | | 1,449,712 | |

| Total capital (b) | | | 2,648,094 | | | | 1,767,369 | | | | 1,724,211 | | | | 1,661,110 | | | | 1,496,681 | |

| Total assets | | | 3,414,539 | | | | 2,420,583 | | | | 2,358,314 | | | | 2,278,957 | | | | 2,051,778 | |

| Long-term liabilities | | | 1,611,300 | | | | 1,237,437 | | | | 1,407,522 | | | | 1,003,292 | | | | 927,118 | |

| (e) | Certain amounts for the years 2013 through 2016 have been adjusted to reflect the retrospective application of our reclassification of debt issuance costs upon the adoption of a new accounting standard, as described in Note 2 to the Consolidated Financial Statements. |

| --- | --- |

| Net property, plant and equipment and other non-current assets | | | 1,676,790 | | | | 1,648,853 | | | | 1,607,447 | | | | 1,451,113 | | | | 1,242,892 | |

| Total capital (b) | | | 1,769,151 | | | | 1,726,341 | | | | 1,662,283 | | | | 1,498,082 | | | | 1,261,962 | |

| Total assets | | | 2,422,365 | | | | 2,360,444 | | | | 2,280,130 | | | | 2,053,179 | | | | 1,829,515 | |

| Long-term liabilities | | | 1,239,219 | | | | 1,409,652 | | | | 1,004,465 | | | | 928,519 | | | | 816,061 | |

| Years ended October 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014] [added: 2015] | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | |

| Sales | | $ | [removed: 1,808,994] [added: 2,066,982] | | | $ | [removed: 1,688,666] [added: 1,808,994] | | | $ | [removed: 1,704,021] [added: 1,688,666] | |

| Cost of sales | | | [removed: 815,495] [added: 927,981] | | | | [removed: 774,702] [added: 815,495] | | | | [removed: 758,923] [added: 774,702] | |

| Selling and administrative expenses | | | [removed: 594,293] [added: 678,861] | | | | [removed: 584,823] [added: 594,293] | | | | [removed: 575,442] [added: 584,823] | |

| Severance and restructuring costs | | | [removed: 10,775] [added: 2,438] | | | | [removed: 11,411] [added: 10,775] | | | | [removed: 2,551] [added: 11,411] | |

| | | | [removed: 1,420,563] [added: 1,609,280] | | | | [removed: 1,370,936] [added: 1,420,563] | | | | [removed: 1,336,916] [added: 1,370,936] | |

| Operating profit | | | [removed: 388,431] [added: 457,702] | | | | [removed: 317,730] [added: 388,431] | | | | [removed: 367,105] [added: 317,730] | |

| Interest expense | | | [removed: (21,322] [added: (36,601] | ) | | | [removed: (18,104] [added: (21,322] | ) | | | [removed: (15,035] [added: (18,104] | ) |

| Interest and investment income | | | [removed: 728] [added: 1,124] | | | | [removed: 558] [added: 728] | | | | [removed: 581] [added: 558] | |

| Other - net | | | [removed: 657] [added: (1,934] | [added: )] | | | [removed: 678] [added: 657] | | | | [removed: (138] [added: 678] | [removed: )] |

| | | | [removed: (19,937] [added: (37,411] | ) | | | [removed: (16,868] [added: (19,937] | ) | | | [removed: (14,592] [added: (16,868] | ) |

| Income before income taxes | | | [removed: 368,494] [added: 420,291] | | | | [removed: 300,862] [added: 368,494] | | | | [removed: 352,513] [added: 300,862] | |

| Current | | | [removed: 100,248] [added: 124,961] | | | | [removed: 87,651] [added: 100,248] | | | | [removed: 102,251] [added: 87,651] | |

| Deferred | | | [removed: (3,597] [added: (472] | ) | | | [removed: 2,100] [added: (3,597] | [added: )] | | | [removed: 3,489] [added: 2,100] | |

| Net income | | $ | [removed: 271,843] [added: 295,802] | | | $ | [removed: 211,111] [added: 271,843] | | | $ | [removed: 246,773] [added: 211,111] | |

| Average common shares | | | [removed: 57,060] [added: 57,533] | | | | [removed: 60,652] [added: 57,060] | | | | [removed: 63,656] [added: 60,652] | |

| Incremental common shares attributable to outstanding stock options, restricted stock and deferred stock-based compensation | | | [removed: 470] [added: 671] | | | | [removed: 499] [added: 470] | | | | [removed: 625] [added: 499] | |

| Average common shares and common share equivalents | | | [removed: 57,530] [added: 58,204] | | | | [removed: 61,151] [added: 57,530] | | | | [removed: 64,281] [added: 61,151] | |

| Basic earnings per share | | $ | [removed: 4.76] [added: 5.14] | | | $ | [removed: 3.48] [added: 4.76] | | | $ | [removed: 3.88] [added: 3.48] | |

| Diluted earnings per share | | $ | [removed: 4.73] [added: 5.08] | | | $ | [removed: 3.45] [added: 4.73] | | | $ | [removed: 3.84] [added: 3.45] | |

| Dividends declared per common share | | $ | [removed: 0.99] [added: 1.11] | | | $ | [removed: 0.90] [added: 0.99] | | | $ | [removed: 0.76] [added: 0.90] | |

Nordson Corporation [removed: 34][added: 71]

| [removed: Translation] [added: Foreign currency translation] adjustments | | | [removed: (8,693] [added: 22,697] | [removed: )] | | | [removed: (45,154] [added: (8,693] | ) | | | [removed: (23,972] [added: (45,154] | ) |

| Prior service credit arising during the year | | | [removed: 1,831] [added: —] | | | | [removed: —] [added: 1,831] | | | | [removed: 175] [added: —] | |

| Net actuarial [removed: loss] [added: gain (loss)] arising during the year | | | [removed: (22,482] [added: 2,641] | [removed: )] | | | [removed: (7,588] [added: (22,482] | ) | | | [removed: (29,158] [added: (7,588] | ) |

| Amortization of prior service cost | | | [removed: 92] [added: (210] | [added: )] | | | [removed: (303] [added: 92] | [removed: )] | | | [removed: (251] [added: (303] | ) |

| Amortization of actuarial loss | | | [removed: 6,724] [added: 7,972] | | | | [removed: 10,146] [added: 6,724] | | | | [removed: 6,989] [added: 10,146] | |

| Settlement loss recognized | | | [removed: 111] [added: 712] | | | | [removed: 1,369] [added: 111] | | | | [removed: 398] [added: 1,369] | |

| Curtailment (gain) loss recognized | | | [removed: (1,144] [added: —] | [removed: )] | | | [removed: 43] [added: (1,144] | [added: )] | | | [removed: —] [added: 43] | |

| Total pension and postretirement benefit plans | | | [removed: (14,868] [added: 11,115] | [removed: )] | | | [removed: 3,667] [added: (14,868] | [added: )] | | | [removed: (21,847] [added: 3,667] | [removed: )] |

| Total other comprehensive income (loss) | | | [removed: (23,561] [added: 33,812] | [removed: )] | | | [removed: (41,487] [added: (23,561] | ) | | | [removed: (45,819] [added: (41,487] | ) |

| Total comprehensive income | | $ | [removed: 248,282] [added: 329,614] | | | $ | [removed: 169,624] [added: 248,282] | | | $ | [removed: 200,954] [added: 169,624] | |

| October 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | |

| Cash and cash equivalents | | $ | [removed: 67,239] [added: 90,383] | | | $ | [removed: 50,268] [added: 67,239] | |

| Receivables - net | | | [removed: 428,560] [added: 505,087] | | | | [removed: 389,550] [added: 428,560] | |

| Inventories - net | | | [removed: 220,361] [added: 264,266] | | | | [removed: 225,672] [added: 220,361] | |

| Deferred income taxes | | | [removed: —] [added: 11,020] | | | | [removed: 24,865] [added: 10,681] | |

| Prepaid expenses | | | [removed: 29,415] [added: 28,636] | | | | [removed: 21,236] [added: 29,415] | |

| Total current assets | | | [removed: 745,575] [added: 888,372] | | | | [removed: 711,591] [added: 745,575] | |

| Property, plant and equipment - net | | | [removed: 273,129] [added: 346,411] | | | | [removed: 249,940] [added: 273,129] | |

| | | | 124,489 | | | | 96,651 | | | | 89,751 | |

| Years ended October 31, 2017, 2016 and 2015 | | 2017 | | | | 2016 | | | | 2015 | | |

| Other assets | | | 32,346 | | | | 23,759 | |

| | | $ | 3,414,539 | | | $ | 2,420,583 | |

| Long-term debt | | | 1,256,397 | | | | 942,771 | |

| | | $ | 3,414,539 | | | $ | 2,420,583 | |

| Years ended October 31, 2017, 2016 and 2015 | | 2017 | | | | 2016 | | | | 2015 | | |

| Net income | | | 295,802 | | | | 271,843 | | | | 211,111 | |

| Foreign currency translation adjustments | | | 22,697 | | | | (8,693 | ) | | | (45,154 | ) |

| Years ended October 31, 2017, 2016 and 2015 | | 2017 | | | | 2016 | | | | 2015 | | |

| Net income | | $ | 295,802 | | | $ | 271,843 | | | $ | 211,111 | |

No options were excluded from the calculation of diluted earnings per share in 2017.

Credit is extended to customers satisfying pre-defined credit criteria.

We believe we have limited concentration of credit risk due to the diversity of our customer base.

Inventories — Inventories are valued at net realizable value.

| Balance at October 31, 2017 | | $ | (28,423 | ) | | $ | (106,012 | ) | | $ | (134,435 | ) |

| | | 2017 | | | | 2016 | | |

New accounting guidance adopted:

We adopted this standard during the first quarter of 2017, and applied this standard retrospectively to 2016.

The new guidance only impacted presentation on our consolidated balance sheet and did not affect our results of operations or other financial statement disclosures.

Refer to Note 10 for the impact on our Consolidated Balance Sheet at October 31, 2016.

In May 2015, the FASB issued a new standard regarding the disclosures for investments that calculate net asset value per share (or its equivalent).

Under the new guidance, investments measured at net asset value (“NAV”), as a practical expedient for fair value, are excluded from the fair value hierarchy.

Removing investments measured using the practical expedient from the fair value hierarchy is intended to eliminate the diversity in practice that currently exists with respect to the categorization of these investments.

We adopted this standard in 2017.

The new guidance only impacted the presentation of certain pension related assets that use NAV as a practical expedient.

Refer to Note 7 for additional information.

In October 2016, the FASB issued a new standard which requires companies to recognize in the income statement the income tax effects of intercompany sales or transfer of assets, other than inventory, as income tax expense (or benefit) in the period the sale or transfer occurs.

It would have been effective for us beginning in 2019; however, we early adopted this guidance in the first quarter of 2017, and it did not have a material impact on our consolidated financial statements.

In January 2017, the FASB issued a new standard which eliminates Step 2 from the goodwill impairment test in order to simplify the subsequent measurement of any goodwill impairment charge.

Early adoption is permitted for annual or interim goodwill impairment tests performed on testing dates after January 1, 2017, and the prospective transition method should be applied.

We adopted this standard, prospectively, in the fourth quarter of 2017.

The adoption did not have an impact on our consolidated financial statements as we did not record any goodwill impairment charges.

New accounting guidance issued and not yet adopted:

We have not yet selected a transition method; however, we are currently anticipating using the modified retrospective method, but will base the final decision on the results of our assessment once complete.

Our initial analysis of identifying revenue streams and evaluating a representative sample of contracts and other agreements with our customers is substantially complete.

We are in the process of assessing the impact of the new standard, if any, on our business processes, systems and controls.

We will finalize our evaluation of potential differences that may result from applying the new standard to our contracts with customers in 2018 and provide updates on our progress in future filings.

In March 2017, the FASB issued a new standard which requires the presentation of the service cost component of the net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period.

All other components of net periodic benefit cost will be presented below operating income.

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | 96,651 | | | | 89,751 | | | | 105,740 | |

| Deferred income taxes | | | 10,681 | | | | 5,705 | |

| | | $ | 2,422,365 | | | $ | 2,360,444 | |

| Long-term debt | | | 944,553 | | | | 1,092,643 | |

| Deferred income taxes | | | 61,836 | | | | 89,770 | |

Cash and cash equivalents are carried at cost, which approximates fair value.

Inventories — Inventories are valued at the lower of cost or market.

| Balance at October 31, 2015 | | $ | (42,427 | ) | | $ | (102,259 | ) | | $ | (144,686 | ) |

Early adoption is permitted, but not before the original effective date of the standard.

We are performing a preliminary review of the new guidance as compared to our current accounting policies.

During 2017, we plan to assess our contracts and consider our method of adoption.

We do not expect this standard to have a material impact on our consolidated financial statements as it will only impact presentation.

In July 2015, the FASB issued a new standard regarding the measurement of inventory.

Under this standard, inventory that is measured using the first-in, first-out (“FIFO”) or average cost methods is required to be measured at the lower of cost or net realizable value.

Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation.

This standard does not impact inventory measured on a last-in, last-out (“LIFO”) method.

We do not expect this standard to have a material impact on our consolidated financial statements.

In September 2015, the FASB issued a new standard intended to simplify the accounting for measurement period adjustments in a business combination.

Measurement period adjustments are changes to provisional amounts recorded when the accounting for a business combination is incomplete as of the end of a reporting period.

The measurement period can extend for up to a year following the transaction date.

During the measurement period, companies may make adjustments to provisional amounts when information necessary to complete the measurement is received.

The new guidance requires companies to recognize these adjustments, including any related impacts to net income, in the reporting period in which the adjustments are determined.

Companies are no longer required to retroactively apply measurement period adjustments to all periods presented.

The new guidance will be applied prospectively and the impact of adoption will be dependent on the nature of measurement period adjustments that may be necessary.

In November 2015, the FASB issued a new standard regarding the balance sheet classification of deferred taxes, which will require entities to present deferred tax assets and liabilities as noncurrent on the balance sheet.

This guidance simplifies the current guidance, which requires entities to separately present deferred tax assets and liabilities as current and noncurrent on the balance sheet.

We have elected to early adopt this standard prospectively as of October 31, 2016, as is permitted under the standard.

Due to the prospective treatment, prior periods presented in these financial statements have not been adjusted.

| Charged to expense | | | 4,576 | | | | 989 | | | | 5,565 | |

| Cash payments | | | — | | | | (624 | ) | | | (624 | ) |

Costs of $5,210 and $11,411 were recognized in 2016 and 2015, respectively, related to these initiatives, which consisted primarily of severance costs.

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Accrual Balance at October 31, 2015 | | $ | — | | | $ | 7,908 | | | $ | 1,322 | | | $ | 244 | | | $ | 9,474 | |

| Charged to expense | | | 205 | | | | 3,562 | | | | 61 | | | | 1,382 | | | | 5,210 | |

| Cash payments | | | — | | | | (10,334 | ) | | | (1,240 | ) | | | (1,000 | ) | | | (12,574 | ) |

| Non cash utilization | | | (205 | ) | | | — | | | | — | | | | (129 | ) | | | (334 | ) |

Pro-forma results of operations would not have been materially different from reported results and, therefore, are not presented.

As of October 31, 2016, the purchase price allocations remain preliminary as we complete our assessments of deferred taxes, intangible assets and certain reserves.

2014 acquisitions

| | (a) | Evaluation of disclosure controls and procedures. Our management, with the participation of the principal executive officer (president and chief executive officer) and the principal financial officer (senior vice president and chief financial officer), has reviewed and evaluated our disclosure controls and procedures (as defined in the Securities Exchange Act Rule 13a-15e) as of October 31, [removed: 2016.] [added: 2017.] Based on that evaluation, our management, including the principal executive and financial officers, has concluded that our disclosure controls and procedures were effective as of October 31, [removed: 2016] [added: 2017] in ensuring that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and is accumulated and communicated to our management, including the principal executive officer and the principal financial officer, as appropriate to allow timely decisions regarding required disclosure. |

| | (c) | Changes in internal control over reporting. There were no changes in our internal controls over financial reporting that occurred during the fourth quarter of [removed: 2016] [added: 2017] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. |

Nordson Corporation [removed: 71][added: 73]

The information required by this Item is incorporated by reference to the captions “Election of Directors Whose Terms Expire in [removed: 2020”] [added: 2021”] and “Section 16(a) Beneficial Ownership Reporting Compliance” of our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

Information regarding Audit Committee financial experts is incorporated by reference to the caption “Election of Directors Whose Terms Expire in [removed: 2020”] [added: 2021”] of our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

We have adopted a code of ethics [added: and business conduct] for all employees and directors, including the principal executive officer, other executive officers, principal finance officer and other finance personnel.

We intend to satisfy our disclosure requirement under Item 5.05 of Form 8-K regarding any amendment to or waiver of a provision of our code of ethics [added: and business conduct] that applies to our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions and that relates to any element of the code of ethics definition enumerated in Item 406(b) of Regulation S-K by posting such information on our Web site.

The information required by this Item is incorporated by reference to the “Executive Compensation Discussion and Analysis” section of the definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders, along with the sections captioned “Directors Compensation,” “Summary Compensation Table,” “Grants of Plan-Based Awards,” “Outstanding Equity Awards at October 31, [removed: 2016,” “Option] [added: 2017,” “Stock Option] Exercises and Stock Vested Tables,” “Pension Benefits Table,” “Nonqualified Deferred Compensation” and “Potential Benefits Upon Termination” in our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

The information required by this Item is incorporated by reference to the caption “Security Ownership of Nordson Common Shares by Directors, [added: Director Nominees,] Executive Officers and Large Beneficial Owners” in our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

The following table sets forth information regarding equity compensation plans in effect as of October 31, [removed: 2016:][added: 2017:]

| Equity compensation plans approved by security holders | | | [removed: 1,881] [added: 1,922] | | | $ | [removed: 58.41] [added: 70.08] | | | | [removed: 5,000] [added: 2,900] | |

| Total | | | 1,922 | | | $ | 70.08 | | | | 2,900 | |

| Total | | | 1,881 | | | $ | 58.41 | | | | 5,000 | |

The information required by this Item is incorporated by reference to the caption “Review of Transactions with Related Persons” in our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

Nordson Corporation 74

The information required by this Item is incorporated by reference to the caption “Fees Paid to Ernst & Young LLP” in our definitive Proxy Statement for the [removed: 2017] [added: 2018] Annual Meeting of Shareholders.

Nordson Corporation [removed: 72][added: 75]

Consolidated Statements of Income for each of the three years in the period ended October 31, [removed: 2016][added: 2017]

Consolidated Statements of Comprehensive Income for each of the three years in the period ended October 31, [removed: 2016][added: 2017]

Consolidated Balance Sheets as of October 31, [removed: 2016] [added: 2017] and October 31, [removed: 2015][added: 2016]

Consolidated Statements of Shareholders’ Equity for each of the three years in the period ended October 31, [removed: 2016][added: 2017]

Consolidated Statements of Cash Flows for each of the three years in the period ended October 31, [removed: 2016][added: 2017]

Schedule II Valuation and Qualifying Accounts and Reserves for each of the three years in the period [removed: ending] [added: ended] October 31, [removed: 2016.][added: 2017.]

| [removed: 3-a] [added: 3-b] | | [removed: 1989] [added: [1998] Amended [removed: Articles of Incorporation] [added: Regulations] (incorporated herein by reference to Exhibit [removed: 3-a] [added: 3-b] to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2011)] [added: 2016)](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex3b_159.htm)] |

| 4-b | | [removed: Amended] [added: [Amended] and Restated Note Purchase and Private Shelf Agreement for $200 million between Nordson Corporation and New York Life Investment Management LLC dated as of September 30, 2016 [added: (incorporated herein by reference to Exhibit 4-b to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex4b_158.htm)] |

| [removed: 4-c] [added: 4-h] | | [removed: $500 million] [added: [Second Amended and Restated] Credit Agreement dated [removed: December 9, 2011] [added: February 20, 2015] between Nordson Corporation and various financial institutions (incorporated herein by reference to Exhibit 4.1 to Registrant’s Form 8-K dated [removed: December 12, 2011)] [added: February 26, 2015)](http://www.sec.gov/Archives/edgar/data/72331/000129993315000304/exhibit1.htm)] |

| 4-e | | [removed: Master] [added: [Master] Note Purchase Agreement dated July 26, 2012 between Nordson Corporation and the purchasers listed therein (incorporated herein by reference to Exhibit 4.2 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2012)] [added: 2012)](http://www.sec.gov/Archives/edgar/data/72331/000119312512380965/d375970dex42.htm)] |

| 4-g | | [removed: Credit] [added: [Credit] Agreement dated August 6, 2014 by and among Nordson Corporation, PNC Bank National Association and PNC Capital Markets LLC (incorporated herein by reference to Exhibit 10.3 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2014)] [added: 2014)](http://www.sec.gov/Archives/edgar/data/72331/000119312514331480/d746837dex103.htm)] |

| 4-i | | [removed: $200] [added: [$200] million Term Loan Facility Agreement dated April 10, 2015 between Nordson Corporation and PNC Bank National Association (incorporated herein by reference to Exhibit 4.2 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended April 30, [removed: 2015)] [added: 2015)](http://www.sec.gov/Archives/edgar/data/72331/000156459015004835/ndsn-ex42_20150430363.htm)] |

| 4-j | | [removed: Master] [added: [Master] Note Purchase Agreement dated July 28, 2015 between Nordson Corporation and the purchasers listed therein (incorporated herein by reference to Exhibit 4.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2015)] [added: 2015)](http://www.sec.gov/Archives/edgar/data/72331/000156459015007736/ndsn-ex41_228.htm)] |

| 10-b-2 | | [removed: Nordson] [added: [Nordson] Corporation 2005 Deferred Compensation Plan (as Amended and Restated Effective January 1, 2009) (incorporated herein by reference to Exhibit 10-b-2 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10b2.htm)] |

| 10-b-3 | | [removed: First amendment] [added: [First Amendment] to the Nordson Corporation 2005 Deferred Compensation Plan (incorporated herein by reference to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended April 30, [removed: 2016).] [added: 2016)](http://www.sec.gov/Archives/edgar/data/72331/000156459016020351/ndsn-ex101_100.htm)] |

| 10-c | | [removed: Resolution] [added: [Resolution] of Board of Directors Authorizing Execution of Indemnification Agreements (incorporated herein by reference to Exhibit 10-c to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2013)*] [added: 2013)*](http://www.sec.gov/Archives/edgar/data/72331/000119312513474384/d597887dex10c.htm)] |

| 10-d-1 | | [removed: First] [added: [First] Amendment to Nordson Corporation Excess Defined Contribution Retirement Plan (incorporated herein by reference to Exhibit 10-d-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2012)*] [added: 2012)*](http://www.sec.gov/Archives/edgar/data/72331/000119312512504725/d388192dex10d1.htm)] |

| [removed: 10-d-2] [added: 10-e-2] | | [removed: Nordson] [added: [Nordson] Corporation 2005 Excess Defined [removed: Contribution] Benefit [added: Pension] Plan (incorporated herein by reference to Exhibit [removed: 10-d-2] [added: 10-e-2] to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2011)*] [added: 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10e2_165.htm)] |

| 10-d-3 | | [removed: Nordson] [added: [Nordson] Corporation 2005 Excess Defined Contribution Retirement Plan (as Amended and Restated Effective January 1, 2009) (incorporated herein by reference to Exhibit 10-d-3 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10d3.htm)] |

| 10-e-1 | | [removed: Second] [added: [Second] Amendment to Nordson Corporation Excess Defined Benefit Pension Plan (incorporated herein by reference to Exhibit 10-e-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2012)*] [added: 2012)*](http://www.sec.gov/Archives/edgar/data/72331/000119312512504725/d388192dex10e1.htm)] |

| 10-e-3 | | [removed: Nordson] [added: [Nordson] Corporation 2005 Excess Defined Benefit Pension Plan (as Amended and Restated Effective January 1, 2009) (incorporated herein by reference to Exhibit 10-e-3 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10e3.htm)] |

| 10-g-1 | | [removed: Amended] [added: [Amended] and Restated Nordson Corporation 2004 Long-Term Performance Plan (incorporated herein by reference to Exhibit 10-g-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2013)*] [added: 2013)*](http://www.sec.gov/Archives/edgar/data/72331/000119312513474384/d597887dex10g1.htm)] |

| 10-g-2 | | [removed: Nordson] [added: [Nordson] Corporation 2012 Stock Incentive and Award Plan (incorporated by reference to Exhibit 10.1 to Registrant’s Form 8-K dated March 4, [removed: 2013)*] [added: 2013)*](http://www.sec.gov/Archives/edgar/data/72331/000119312513088774/d495750dex101.htm)] |

| 10-g-3 | | [removed: Nordson] [added: [Nordson] Corporation 2012 Stock Incentive and Award Plan, Form of Notice of Award – Key Employees (as amended November 24, 2014) (incorporated herein by reference to Exhibit 10-g-3 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10g3.htm)] |

| 10-g-4 | | [removed: Nordson] [added: [Nordson] Corporation 2012 Stock Incentive and Award Plan, Form of Notice of Award – Executive Officers (as amended November 24, 2014) (incorporated herein by reference to Exhibit 10-g-4 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10g4.htm)] |

| 10-g-5 | | [removed: Nordson] [added: [Nordson] Corporation 2012 Stock Incentive and Award Plan, Directors’ Deferred Compensation Sub-Plan (incorporated herein by reference to Exhibit [removed: 10-g -5] [added: 10-g-5] to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2013)*] [added: 2013)*](http://www.sec.gov/Archives/edgar/data/72331/000119312513474384/d597887dex10g5.htm)] |

| 10-g-6 | | [removed: Nordson] [added: [Nordson] Corporation 2012 Stock Incentive and Award Plan, Directors’ Deferred Compensation Sub-Plan, Form of Notice of Award (incorporated herein by reference to Exhibit 10-g-6 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2013)*] [added: 2013)*](http://www.sec.gov/Archives/edgar/data/72331/000119312513474384/d597887dex10g6.htm)] |

| 10-h | | [removed: Assurance] [added: [Assurance] Trust Agreement between Nordson Corporation and Key Trust Company of Ohio, N.A. amended and restated as of January 22, 2014 (incorporated herein by reference to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended January 31, [removed: 2014)] [added: 2014)](http://www.sec.gov/Archives/edgar/data/72331/000119312514088017/d657923dex101.htm)] |

| 10-h-1 | | [removed: Form] [added: [Form] of Change in Control Retention Agreement between the Registrant and Executive Officers (incorporated herein by reference to Exhibit 10-h-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2014)*] [added: 2014)*](http://www.sec.gov/Archives/edgar/data/72331/000119312514442368/d787677dex10h1.htm)] |

| 10-j | | [removed: Compensation] [added: [Compensation] Committee Rules of the Nordson Corporation Amended and Restated Nordson Corporation 2004 Long Term Performance Plan governing directors’ deferred [removed: compensation*] [added: compensation (incorporated herein by reference to Exhibit 10-j to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10j_162.htm)] |

| 10-m | | [removed: Employment] [added: [Employment] Agreement between Registrant and Michael F. Hilton (incorporated herein by reference to Exhibit 10-m to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2015)*] [added: 2015)*](http://www.sec.gov/Archives/edgar/data/72331/000156459015011507/ndsn-ex10m_428.htm)] |

| 10-n | | [removed: Employment] [added: [Employment] Agreement (Change in Control Retention Agreement) between Registrant and Michael F. Hilton (incorporated herein by reference to Exhibit 10-n to Registrant’s Annual Report on Form 10-K for the year ended October 31, [removed: 2015)*] [added: 2015)*](http://www.sec.gov/Archives/edgar/data/72331/000156459015011507/ndsn-ex10n_429.htm)] |

| 10-p | | [removed: Stock] [added: [Stock] Purchase Agreement by and among VP Acquisition Holdings, Inc., the Stockholders of VP Acquisition Holdings, Inc., the Optionholders of VP Acquisition Holdings, Inc., American Capital, Ltd., as Securityholder Representative, and Nordson Corporation dated as of July 15, 2011 [added: (incorporated herein by reference to Exhibit 10-p to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10p_161.htm)] |

| 10-q | | [removed: Stock] [added: [Stock] Purchase Agreement dated May 18, 2012 by and among Nordson Corporation and Bertram Growth Capital I, Bertram Growth Capital II, Bertram Growth Capital II-A, and EDI Holdings, Inc. (incorporated herein by reference to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2012)] [added: 2012)](http://www.sec.gov/Archives/edgar/data/72331/000119312512380965/d375970dex101.htm)] |

| 10-r | | [removed: Agreement] [added: [Agreement] and Plan of Merger by and among Xaloy Superior Holdings, Inc., Nordson Corporation, Buckeye Merger Corp. and Sellers’ Representative dated as of June 2, 2012 (incorporated herein by reference to Exhibit 10.2 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2012)] [added: 2012)](http://www.sec.gov/Archives/edgar/data/72331/000119312512380965/d375970dex102.htm)] |

| 10-s | | [removed: Sale] [added: [Sale] and Purchase Agreement dated July 16, 2013 relating to Kreyenborg and BKG between Mr. Jan-Udo Kreyenborg, Kreyenborg Verwaltungen und Beteiligungen GmbH & Co. KG, Kreyenborg Verwaltungs-GmbH and Nordson Corporation (incorporated herein by reference to Exhibit 10.1 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2013)] [added: 2013)](http://www.sec.gov/Archives/edgar/data/72331/000119312513357755/d560230dex101.htm)] |

| 10-u | | [removed: Agreement] [added: [Agreement] and Plan of Merger by and among Avalon Laboratories Holding Corp., Nordson Medical Corporation, Arriba Merger Corp., American Capital Equity III, LP, as Securityholders’ Representative and for the limited purposes set forth herein, Nordson Corporation, dated as of August 1, 2014 (incorporated herein by reference to Exhibit 10.2 to Registrant’s Quarterly Report on Form 10-Q for the quarter ended July 31, [removed: 2014)] [added: 2014)](http://www.sec.gov/Archives/edgar/data/72331/000119312514331480/d746837dex102.htm)] |

| 31.1 | | [removed: Certification] [added: [Certification] pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 by the Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002] [added: 2002](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex311_12.htm)] |

| 31.2 | | [removed: Certification] [added: [Certification] pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934 by the Chief Financial Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002] [added: 2002](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex312_22.htm)] |

| 32.1 | | [removed: Certification] [added: [Certification] of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002] [added: 2002](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex321_15.htm)] |

| (2) | | Plan of Acquisition, Reorganization or Arrangement |

| 2-a | | [Agreement and Plan of Merger, dated as of February 20, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC (incorporated herein by reference to Exhibit 2.1 to Registrant’s Form 8-K dated April 5, 2017)](http://www.sec.gov/Archives/edgar/data/72331/000119312517111134/d355120dex21.htm) |

| 2-b | | [First Amendment to Agreement and Plan of Merger, dated as of March 30, 2017, by and among Nordson Corporation, Viking Merger Corp., Vention Medical Holdings, Inc. and VMHI Rep Services, LLC (incorporated herein by reference to Exhibit 2.2 to Registrant’s Form 8-K dated April 5, 2017)](http://www.sec.gov/Archives/edgar/data/72331/000119312517111134/d355120dex22.htm) |

| 3-a | | [1989 Amended Articles of Incorporation](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex3a_458.htm) |

| 3-a-1 | | [Certificate of Amendment to 1989 Amended Articles of Incorporation](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex3a1_459.htm) |

| 4-k | | [First Amendment and Joinder to Term Loan Agreement, dated as of March 31, 2017, by and among Nordson Corporation, the lenders party thereto and PNC Bank, National Association, as administrative agent and lender, and Term Loan Agreement, dated as of February 21, 2017, by and among Nordson Corporation, the lenders party thereto, PNC Bank, National Association, as lender and administrative agent, the joint lead arrangers and joint bookrunners party thereto, the co-syndication agents party thereto and the co-documentation agents party thereto (incorporated herein by reference to Exhibit 4.1 to Registrant’s Form 8-K dated April 5, 2017)](http://www.sec.gov/Archives/edgar/data/72331/000119312517111134/d355120dex41.htm) |

| 10-b-1 | | [Nordson Corporation 2005 Deferred Compensation Plan (incorporated herein by reference to Exhibit 10-b-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10b1_157.htm) |

| 10-c-1 | | [Form of Indemnity Agreement between the Registrant and Directors, effective November 1, 2016 (incorporated herein by reference to Exhibit 10-c-1 to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10c1_167.htm) |

| 10-c-2 | | [Form of Indemnity Agreement between the Registrant and Executive Officers, effective November 1, 2016 (incorporated herein by reference to Exhibit 10-c-2 to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10c2_166.htm) |

| 10-d-2 | | [Nordson Corporation 2005 Excess Defined Contribution Benefit Plan*](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex10d2_460.htm) |

| 10-g-7 | | [Amended and Restated Nordson Corporation Directors’ Deferred Compensation Sub-Plan*](https://www.sec.gov/Archives/edgar/data/72331/000156459017024983/ndsn-ex10g7_457.htm) |

| 10-i | | [Compensation Committee Rules of the Nordson Corporation 2004 Long Term Performance Plan governing directors’ deferred compensation (incorporated herein by reference to Exhibit 10-i to Registrant’s Annual Report on Form 10-K for the year ended October 31, 2016)*](http://www.sec.gov/Archives/edgar/data/72331/000156459016030237/ndsn-ex10i_163.htm) |