XML 37 R24.htm IDEA: XBRL DOCUMENT
v3.22.4

Stock-Based Compensation | 12 Months Ended
--- | ---
Oct. 31, 2022
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation | Stock-based compensation During the 2021 Annual Meeting of Shareholders, our shareholders approved the Nordson Corporation 2021 Stock Incentive and Award Plan (the “2021 Plan”) as the successor to the Amended and Restated 2012 Stock Incentive and Award Plan (the "2012 Plan"). The 2021 plan provides for the granting of stock options, stock appreciation rights, restricted shares, restricted share units, performance shares, cash awards and other stock or performance-based incentives. A maximum of 900 common shares were authorized for grant under the 2021 Plan plus the number of shares that were available to be granted under the 2012 Plan. As of October 31, 2022, a total of 2,122 common shares were available to be granted under the 2021 Plan. Stock options — Nonqualified or incentive stock options may be granted to our employees and directors. Generally, options granted to employees may be exercised beginning one year from the date of grant at a rate not exceeding 25 percent per year and expire 10 years from the date of grant. Vesting accelerates upon a qualified termination in connection with a change in control. In the event of termination of employment due to early retirement or normal retirement at age 65, options granted within 12 months prior to termination are forfeited, and vesting continues post retirement for all other unvested options granted. In the event of disability or death, all unvested stock options granted within 12 months prior to termination fully vest. Termination for any other reason results in forfeiture of unvested options and vested options in certain circumstances. The amortized cost of options is accelerated if the retirement eligibility date occurs before the normal vesting date. Option exercises are satisfied through the issuance of treasury shares on a first-in, first-out basis. We recognized compensation expense related to stock options of $7,265, $6,946 and $10,087 for 2022, 2021 and 2020, respectively. The following table summarizes activity related to stock options during 2022:
| Number of Options |  | Weighted˗Average Exercise Price Per Share |  | Aggregate Intrinsic Value |  | Weighted˗Average Remaining Term
Outstanding at October 31, 2021 | 1,235 |  |  | $ | 130.93 |  |  |  |  |
Granted | 85 |  |  | $ | 266.69 |  |  |  |  |
Exercised | (115) |  |  | $ | 108.33 |  |  |  |  |
Forfeited or expired | (18) |  |  | $ | 197.31 |  |  |  |  |
Outstanding at October 31, 2022 | 1,187 |  |  | $ | 141.82 |  |  | $ | 101,946 |  |  | 5.4 years
Expected to vest | 372 |  |  | $ | 185.15 |  |  | $ | 18,004 |  |  | 7.0 years
Exercisable at October 31, 2022 | 813 |  |  | $ | 121.76 |  |  | $ | 83,887 |  |  | 4.6 years
Summarized information on currently outstanding options follows:
| Range of Exercise Price
| $61 - $125 |  | $126 - $190 |  | $191 - $268
Number outstanding | 518 |  |  | 506 |  |  | 163 |
Weighted-average remaining contractual life, in years | 4.5 |  | 6.3 |  | 8.6
Weighted-average exercise price | $ | 104.76 |  |  | $ | 150.57 |  |  | $ | 232.62 |
Number exercisable | 447 |  |  | 345 |  |  | 21 |
Weighted-average exercise price | $ | 101.55 |  |  | $ | 143.04 |  |  | $ | 201.42 |
As of October 31, 2022, there was $6,663 of total unrecognized compensation cost related to unvested stock options. That cost is expected to be amortized over a weighted average period of approximately 1.0 year. The fair value of each option grant was estimated at the date of the grant using the Black-Scholes option-pricing model with the following assumptions:
| 2022 |  | 2021 |  | 2020
Expected volatility | 30.6%-30.8% |  | 30.8%-32.6% |  | 24.5%- | 30.5%
Expected dividend yield | 0.76%-0.89% |  | 0.83%-0.85% |  | 0.87%- | 1.16%
Risk-free interest rate | 1.36%-2.65% |  | 0.43%-0.77% |  | 0.44%- | 1.69%
Expected life of the option (in years) | 5.3-6.2 |  | 5.3-6.2 |  | 5.3- | 6.3
The weighted-average expected volatility used to value options granted in 2022, 2021 and 2020 was 30.6 percent, 31.0 percent and 25.4 percent, respectively. Historical information was the primary basis for the selection of the expected volatility, expected dividend yield and the expected lives of the options. The risk-free interest rate was selected based upon yields of United States Treasury issues with terms equal to the expected life of the option being valued. The weighted average grant date fair value of stock options granted during 2022, 2021 and 2020 was $78.88, $56.02 and $38.57, respectively. The total intrinsic value of options exercised during 2022, 2021 and 2020 was $15,376, $32,791 and $65,783, respectively. Cash received from the exercise of stock options for 2022, 2021 and 2020 was $12,124, $31,780 and $50,853, respectively. Restricted shares and restricted share units — We may grant restricted shares and/or restricted share units to our employees and directors. These shares or units may not be transferred for a designated period of time (generally one to three years) defined at the date of grant. We may also grant continuation awards in the form of restricted share units with cliff vesting and a performance measure that must be achieved for the restricted share units to vest. For employee recipients, in the event of termination of employment due to early retirement, with consent of the Company, restricted shares and units granted within 12 months prior to termination are forfeited, and other restricted shares and units vest on a pro-rata basis, subject to the consent of the Compensation Committee. In the event of termination of employment due to normal retirement at age 65, restricted shares and units granted within 12 months prior to termination are forfeited, and, for other restricted shares and units, the restriction period applicable to restricted shares will lapse and the shares will vest and be transferable and all unvested units will become vested in full, subject to the consent of the Compensation Committee. In the event of a recipient's disability or death, all restricted shares and units granted within 12 months prior to termination fully vest. Termination for any other reason prior to the lapse of any restrictions or vesting of units results in forfeiture of the shares or units. For non-employee directors, all restrictions lapse in the event of disability or death of the non-employee director. Termination of service as a director for any other reason within one year of date of grant results in a pro-rata vesting of shares or units. As shares or units are issued, stock-based compensation equivalent to the fair market value on the date of grant is expensed over the vesting period. The following table summarizes activity related to restricted shares during 2022:
| Number of Shares |  | Weighted˗Average Grant Date Fair Value Per Share
Restricted at October 31, 2021 | 19 |  |  | $ | 157.36 |
Vested | (13) |  |  | $ | 153.28 |
Restricted at October 31, 2022 | 6 |  |  | $ | 167.99 |
As of October 31, 2022, there was $331 of unrecognized compensation cost related to restricted shares. The cost is expected to be amortized over a weighted average period of 0.3 years. The amount charged to expense related to restricted shares was $1,096, $2,054 and $3,956 in 2022, 2021 and 2020, respectively. These amounts included common share dividends of $19, $43 and $87 in 2022, 2021 and 2020, respectively. The following table summarizes activity related to restricted share units in 2022:
| Number of Units |  | Weighted˗Average Grant Date Fair Value
Restricted share units at October 31, 2021 | 67 |  |  | $ | 202.81 |
Granted | 43 |  |  | $ | 253.04 |
Forfeited | (10) |  |  | $ | 224.84 |
Vested | (19) |  |  | $ | 215.57 |
Restricted share units at October 31, 2022 | 81 |  |  | $ | 223.77 |
As of October 31, 2022, there was $8,790 of remaining expense to be recognized related to outstanding restricted share units, which is expected to be recognized over a weighted average period of 0.9 years. The amounts charged to expense related to restricted share units in 2022, 2021 and 2020 were $8,403, $6,264 and $1,181, respectively. Restricted share unit expense increased in 2021 compared to prior years as the granting of restricted share units has generally replaced the granting of stock options for key employees. Performance share incentive awards — Executive officers and selected other key employees are eligible to receive common share-based incentive awards. Payouts, in the form of unrestricted common shares, vary based on the degree to which corporate financial performance exceeds predetermined threshold, target and maximum performance goals over three-year performance periods. No payout will occur unless threshold performance is achieved. The amount of compensation expense is based upon current performance projections and the percentage of the requisite service that has been rendered. The calculations are based upon the grant date fair value which is principally driven by the stock price on the date of grant or a Monte Carlo valuation for awards with market conditions. The per share values were $260.60, $273.50 and $221.94 for 2022; $202.05 for 2021; and $201.50 modified per share value compared to original per share values of $160.02, $133.01 and $184.04 for 2020. The amount charged to expense for executive officers and selected other key employees in 2022 was $13,626 and $7,178 in 2021 while the amount credited to expense in 2020 was $2,732. The cumulative amount recorded in shareholders’ equity at October 31, 2022 and 2021 was $20,641 and $7,015, respectively. As of October 31, 2022, there was $8,029 of unrecognized compensation cost related to performance share incentive awards. Deferred compensation — Our executive officers and other highly compensated employees may elect to defer up to 100 percent of their base pay and cash incentive compensation and, for executive officers, up to 90 percent of their share-based performance incentive award payout each year. Additional share units are credited for quarterly dividends paid on our common shares. Expense related to dividends paid under this plan was $72, $96 and $276 for 2022, 2021 and 2020, respectively. Deferred directors’ compensation — Non-employee directors may defer all or part of their cash and equity-based compensation until retirement. Cash compensation may be deferred as cash or as share equivalent units. Deferred cash amounts are recorded as liabilities, and share equivalent units are recorded as equity. Additional share equivalent units are earned when common share dividends are declared. The following table summarizes activity related to director deferred compensation share equivalent units during 2022:
| Number of Shares |  | Weighted˗Average Grant Date Fair Value Per Share
Outstanding at October 31, 2021 | 106 |  |  | $ | 68.11 |
Restricted stock units vested | 4 |  |  | $ | 255.04 |
Dividend equivalents | 1 |  |  | $ | 227.65 |
Distributions | (21) |  |  | $ | 68.12 |
Outstanding at October 31, 2022 | 90 |  |  | $ | 77.70 |
The amount charged to expense related to director deferred compensation was $305, $262 and $175 in 2022, 2021 and 2020, respectively. Shares reserved for future issuance — At October 31, 2022, there were 1,640 of common shares reserved for future issuance through the exercise of outstanding options or rights.

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI https://asc.fasb.org/topic&trid=2228938 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (l) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 4: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a)(1) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration