NOVEON INC
EXHIBIT 10.17
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<TYPE>EX-10.17
<SEQUENCE>4
<FILENAME>a2128774zex-10_17.htm
<DESCRIPTION>EXHIBIT 10.17
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<P ALIGN="RIGHT"><FONT SIZE=2><B>Exhibit 10.17  </B></FONT></P>


<P><FONT SIZE=2><B>Noveon Sales Holland B.V.<BR>  </B></FONT><FONT SIZE=2>Oosterhorn 4<BR>
NL-9936<BR>
HD Farmsum<BR>
The Netherlands<BR>
Tel.: +31 596 648700<BR>
Fax.: +31 596 648790<BR>
HR Groningen: 27093978<BR>
BTW: NL 809 46 44 69 B01 </FONT></P>

<P><FONT SIZE=2>January&nbsp;1,
2003 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>EMPLOYMENT CONTRACT  </B></FONT></P>

<P><FONT SIZE=2>THE
UNDERSIGNED: </FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(1)</FONT></DT><DD><FONT SIZE=2><B>Noveon Sales Holland B.V.</B></FONT><FONT SIZE=2> (the "Company"), whose registered office is in Farmsum (Oosterhorn 4), and an indirect subsidiary of Noveon,
Inc (the "Parent Company") for these presents lawfully represented by P. Poty, and </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>(2)</B></FONT></DT><DD><FONT SIZE=2><B> K. Verhaar ("Mr.&nbsp;Verhaar"),</B></FONT><FONT SIZE=2>
born on August&nbsp;28, 1953 and residing at Ter Wadding 45b (2253 LZ) Voorschoten. </FONT></DD></DL>

<P><FONT SIZE=2>WHEREAS:
</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>(A)</FONT></DT><DD><FONT SIZE=2>The
Parent Company intends to enter into an employment contract with Mr.&nbsp;Verhaar in the United States in the course of 2003;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(B)</FONT></DT><DD><FONT SIZE=2>Due
to circumstances beyond control of parties, the exact date of commencement of employment in the United States is uncertain;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(c)</FONT></DT><DD><FONT SIZE=2>Parties
have agreed that employment by the Parent Company in the United States commences in any event as per January&nbsp;1, 2004;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(D)</FONT></DT><DD><FONT SIZE=2>Parties
have further agreed that prior to (and until) the commencement of aforementioned employment in the United States, Mr.&nbsp;Verhaar shall be employed by the Company in the
Netherlands;
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>(E)</FONT></DT><DD><FONT SIZE=2>Notwithstanding
the aforementioned, the employment contract between Mr.&nbsp;Verhaar and the Company shall end as per the commencement of employment by the Parent Company in the
United States. </FONT></DD></DL>
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<P><FONT SIZE=2>HEREBY
AGREE AS FOLLOWS:</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>1</B></FONT></DT><DD><FONT SIZE=2><B> Commencement and term of employment</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.1</FONT></DT><DD><FONT SIZE=2>As
of 1 January&nbsp;2003 Mr.&nbsp;Verhaar shall be employed by the Company as Vice President and General Manager Textile Coatings Global Business Unit.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.2</FONT></DT><DD><FONT SIZE=2>This
Agreement has been entered into for a fixed period of time. This agreement shall commence on January&nbsp;1, 2003 and shall terminate as per the date Mr.&nbsp;Verhaar enters
into employment with the Parent Company in the United States. Notwithstanding any other provision herein, this agreement shall in any event end on December&nbsp;31, 2003 without prior notice or
termination being required. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>2</B></FONT></DT><DD><FONT SIZE=2><B> Duties and powers</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.1</FONT></DT><DD><FONT SIZE=2>As
Vice President and General Manager Textile Coatings Global Business Unit of the Company, Mr.&nbsp;Verhaar shall devote all his energy and skill to the Company.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.2</FONT></DT><DD><FONT SIZE=2>In
the performance of his functions Mr.&nbsp;Verhaar shall also observe and comply with the guidelines of the Parent Company in effect from time to time.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.3</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
shall also perform the functions reasonably assigned to him by the Company for any companies affiliated with the Company or the Parent Company. Such functions shall
be governed by the terms and conditions contained in this Agreement and shall not entitle Mr.&nbsp;Verhaar to any further remuneration.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.4</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
shall perform his functions from the office of the Company in Delfzijl. Mr.&nbsp;Verhaar acknowledges that in the performance of his duties he shall have to
travel frequently throughout Europe and the United States. If so required in the opinion of the Company, Mr.&nbsp;Verhaar may be transferred to another location. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT
SIZE=2><B>3</B></FONT></DT><DD><FONT SIZE=2><B> Salary and holiday allowance</B></FONT></DD></DL>
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<P><FONT SIZE=2>Mr.&nbsp;Verhaar
shall receive a salary of Euro 263.175 gross per year. This corresponds to a monthly salary of Euro 18.664,89 which will be paid 14.1 times per year (and which does also include the
holiday allowance of 8%). </FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>4</B></FONT></DT><DD><FONT SIZE=2><B> Bonus</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.1</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
shall participate in the Parent Company's Management Incentive Program ("MIP"), which is an annual bonus program. The target bonus opportunity for the year 2003
will be 55% of Mr.&nbsp;Verhaar's base salary as specified in Article&nbsp;3. Metrics and objectives by which Mr.&nbsp;Verhaar will be evaluated for this discretionary bonus program will be
identified in an separate document.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>4.2</FONT></DT><DD><FONT SIZE=2>Payment
of the bonus shall be made in accordance with the Parent Company's MIP Plan. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>5</B></FONT></DT><DD><FONT SIZE=2><B> Pension</B></FONT></DD></DL>
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<P><FONT SIZE=2>The
Company has a group pension scheme which Mr.&nbsp;Verhaar may join if and to the extent that he satisfies the requirements set out therein. </FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>6</B></FONT></DT><DD><FONT SIZE=2><B> Other insurances</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.1</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
will be eligible to receive the reimbursement for medical insurance applicable to white collar employees of the Company.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>6.2</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
may participate in the Company's Group Accident Insurance Policy. A copy of the insurance policy shall be supplied to Mr.&nbsp;Verhaar. The premium shall be paid
by Mr.&nbsp;Verhaar. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>7</B></FONT></DT><DD><FONT SIZE=2><B> Holidays  </B></FONT></DD></DL>
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<P><FONT SIZE=2>For
each full calendar year during which his employment hereunder continues, Mr.&nbsp;Verhaar shall be entitled to 24 work days' holiday on full pay, to be taken in consultation with the Company. </FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>8</B></FONT></DT><DD><FONT SIZE=2><B> Illness or disablement</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.1</FONT></DT><DD><FONT SIZE=2>In
the event of Mr.&nbsp;Verhaar's incapacity to work on account of illness or disablement the Company shall for a maximum period of twelve months, but until no later than the date
when Mr.&nbsp;Verhaar's employment hereunder ends (if that date is the earlier), continue to pay 100 per cent of the salary as specified in Article&nbsp;3 of this Agreement, subject to deduction
of any benefits to be received by Mr.&nbsp;Verhaar under the social security laws and/or benefits under any other relevant insurances taken out by the Company.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.2</FONT></DT><DD><FONT SIZE=2>During
the period specified in 8.1 the Company shall continue to pay the premiums referred to in Articles 5 and 6, at any rate to the extent that such premiums are under said Articles
to be borne by the Company and are not on any other account not payable.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.3</FONT></DT><DD><FONT SIZE=2>For
the purposes of this Article and Article&nbsp;4, periods of incapacity to work following each other at intervals of less than four weeks shall be regarded as one consecutive
period of incapacity to work.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>8.4</FONT></DT><DD><FONT SIZE=2>On
pain of forfeiture of his entitlement to continued payment of salary pursuant to this Article, Mr.&nbsp;Verhaar must strictly comply with the guidelines and instructions given by
or on behalf of the Company regarding sick leave (of which Mr.&nbsp;Verhaar declares to be familiar with) and if so requested must co-operate in any medical examination with regard
thereto. Forfeiture of the right on continued payment as provided above shall not prejudice the application of other sanctions in this respect. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>9</B></FONT></DT><DD><FONT SIZE=2><B>
Side activities/remuneration from third parties</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>9.1</FONT></DT><DD><FONT SIZE=2>During
his employment Mr.&nbsp;Verhaar shall not perform any paid or unpaid side activities without prior written approval of the Company. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>9.2</FONT></DT><DD><FONT SIZE=2>During
his employment hereunder Mr.&nbsp;Verhaar shall not be permitted to have or take in any way, whether directly or indirectly, any interest in companies pursuing activities in
competition with or similar or related to the activities of the Company and/or the companies affiliated with the Company, or any interest in companies who are suppliers and/or licensors and/or
principals and/or buyers and/or licensees of the Company and/or the companies affiliated with the Company.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>9.3</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
shall not accept any monies or other remuneration from third parties in connection with his activities for the Company and/or the companies affiliated with the
Company. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>10</B></FONT></DT><DD><FONT SIZE=2><B> Confidentiality and non-disclosure</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>10.1</FONT></DT><DD><FONT SIZE=2>During
his employment hereunder as well as after its termination -irrespective of the manner in which and the reasons for which his employment may be terminated- Mr.&nbsp;Verhaar
shall treat as strictly confidential and not disclose to third parties, whether directly or indirectly, in any form or manner whatsoever, any information which comes to his knowledge regarding the
business and interests of the Company (including the Parent Company and its subsidiaries and affiliates) and/or the companies affiliated with the Company and/or its customers and other business
relations, all this in the broadest sense, unless the discharge of his duties requires the disclosure of such information to third parties on a need-to-know basis.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>10.2</FONT></DT><DD><FONT SIZE=2>In
the event that Mr.&nbsp;Verhaar is suspended and upon termination of his employment hereunder - irrespective of the manner in which and the reasons for which his employment may
be terminated-Mr.&nbsp;Verhaar shall at the Company's first request to that effect surrender to the Company all property of the Company in his possession as well as all documents which in any way
whatever relate to the Company and/or the companies affiliated with the Company and/or its customers and other business relations, all this in the broadest sense, as well as all copies of such
documents (whether or not recorded on data carriers) and property. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>11</B></FONT></DT><DD><FONT SIZE=2><B> Intellectual property rights</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>11.1</FONT></DT><DD><FONT SIZE=2>All
intellectual property nghts, including but not limited to copyright and patent, design and trade mark rights, in any products, works and/or services developed by
Mr.&nbsp;Verhaar during or in connection with his employment hereunder shall vest in the Company.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>11.2</FONT></DT><DD><FONT SIZE=2>Mr.&nbsp;Verhaar
hereby, in so far as necessary, assigns to the Company, which assignment is hereby accepted by the Company, all intellectual property rights in any products, works
and/or services developed (completely or in part) by Mr.&nbsp;Verhaar during or in connection with his employment hereunder. Mr.&nbsp;Verhaar agrees that where this assignment (or part thereof)
should at any time prove to be legally invalid, he shall at such time assign said rights -without imposing any condition thereon- to the Company by a separate deed. </FONT></DD></DL>
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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>11.3</FONT></DT><DD><FONT SIZE=2>In
respect of the products, works and/or services referred to in this Article, Mr.&nbsp;Verhaar hereby waives any and all moral rights as defined in Section&nbsp;25 of the
Copyright Act.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>11.4</FONT></DT><DD><FONT SIZE=2>The
provisions of this Article imply that both during his employment hereunder and at any time thereafter Mr.&nbsp;Verhaar shall not be permitted to commercially exploit or cause
others to commercially exploit in whatever manner and/or to register or cause others to register any products, works and/or services developed by him during or in connection with his employment
hereunder. </FONT></DD></DL>
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<P><FONT SIZE=2>The
parties agree that the salary of Mr.&nbsp;Verhaar is deemed to include compensation for deprivation (if any) of intellectual property rights. </FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>12</B></FONT></DT><DD><FONT SIZE=2><B> Remedy for breach of contract</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>12.1</FONT></DT><DD><FONT SIZE=2>In
the event that Mr.&nbsp;Verhaar commits any breach of Articles 9, 10 and/or 11 he shall, in variance from the provisions of Section&nbsp;7:650 subsections 3, 4 and 5 of the
Civil Code, forfeit to the Company an immediately payable penalty of EUR 50,000 for each such breach, to be increased by EUR 5,000 for each day that any such breach continues, without prior notice or
judicial intervention being required and entirely without prejudice to the Company's right to demand full compensation for the loss actually suffered by it and/or to demand specific performance
instead of the aforesaid penalty.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>12.2</FONT></DT><DD><FONT SIZE=2>Payment
of the penalty referred to in 12.1 shall not release Mr.&nbsp;Verhaar from his obligations specified in Articles 9, 10 and 11. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>13</B></FONT></DT><DD><FONT SIZE=2><B> Final
provisions</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.1</FONT></DT><DD><FONT SIZE=2>This
Agreement and any and all disputes which may arise from or in connection with this Agreement shall be governed by the laws of the Netherlands.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.2</FONT></DT><DD><FONT SIZE=2>Any
and all disputes which may arise from or in connection with this Agreement shall be submitted to the Dutch competent court.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.3</FONT></DT><DD><FONT SIZE=2>All
income tax and social security contributions which an employer must by law deduct from his employees' salaries and pay to the relevant authorities shall be so deducted from and
paid in respect of all amounts to be paid to Mr.&nbsp;Verhaar under this Agreement, unless it follows from the nature of the payment that it may be made tax-free.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.4</FONT></DT><DD><FONT SIZE=2>If
at any time it is determined by the Inspector of Taxes and/or the Implementing Authority Employees Insurances ("UVVV") that any of the payments to be made to Mr.&nbsp;Verhaar
under Article&nbsp;4 are (in part) subject to the levy of income tax and/or social security contributions, the compulsory deductions shall be made yet and charged to the debit of Mr. Verhaar. As
from such time the amounts of the relevant future payments under Article&nbsp;4 shall be reduced to the level at which such payments may be made tax-free. </FONT></DD></DL>
<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.5</FONT></DT><DD><FONT SIZE=2>Within
the limits of reasonableness the Company reserves the right to modify and/or supplement this Agreement and all arrangements made hereunder between the parties, if in the
Company's judgement circumstances warrant such modification or supplementation.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>13.6</FONT></DT><DD><FONT SIZE=2>Except
for the non-competition agreement executed with the Parent Company, the foregoing constitutes the entire agreement between the parties and supersedes all
agreements and undertakings previously made and given by and between Mr.&nbsp;Verhaar and the (bodies of the) Company and/or companies affiliated with the Company. Variations from or supplements to
this Agreement shall be valid only if based on a resolution of the General Meeting of Shareholders of the Company. </FONT><FONT SIZE=2><B> <BR><BR> </B></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2><B>14</B></FONT></DT><DD><FONT SIZE=2><B> Severance
pay</B></FONT><FONT SIZE=2>
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>14.1</FONT></DT><DD><FONT SIZE=2>If
the employment is terminated (i)&nbsp;by the Company prior to the expiration of this Contract and for any reason other than for cause or (ii)&nbsp;because of the expiration of
the Contract at the end of its term, in either case without Mr.&nbsp;Verhaar being offered employment by the Parent Company, then in order to prevent a situation of unfair dismissal and to settle in
advance any dispute thereon the Company shall by way of a hereby fixed compensation pay to Mr.&nbsp;Verhaar on the effective date of termination a sum equal to the amount paid by the Company to
Mr.&nbsp;Verhaar's salary (as referred to in Article&nbsp;3) in the last twelve months of his employment, including his benefits.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>14.2</FONT></DT><DD><FONT SIZE=2>The
parties expressly consider the arrangements described in this Article to be a </FONT><FONT SIZE=2><I>"vaststellingsovereenkoms!"</I></FONT><FONT SIZE=2> (agreement establishing
the parties' existing legal relationship) in the terms of Section&nbsp;7:900 of the Netherlands Civil Code. </FONT></DD></DL>

<P><FONT SIZE=2>In
witness whereof this Agreement was executed in three originals and signed by the parties effective as of January&nbsp;1, 2003. </FONT></P>

<P><FONT SIZE=2>NOVEON
SALES HOLLAND B.V. </FONT></P>

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 </B></FONT><HR NOSHADE><FONT SIZE=2> P. Poty<BR>
Director Human Resources and Regulatory Affairs EMEAI</FONT></TD>
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 </B></FONT><HR NOSHADE><FONT SIZE=2> K. VERHAAR</FONT></TD>
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<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<P><FONT SIZE=2><B>Noveon Sales Holland B.V.<BR>  </B></FONT><FONT SIZE=2>Oosterhorn 4<BR>
NL-9936<BR>
HD Farmsum<BR>
The Netherlands<BR>
Tel.: +31 596 648700<BR>
Fax.: +31 596 648790<BR>
HR Groningen: 27093978<BR>
BTW: NL 809 46 44 69 B01 </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2><B>ADDENDUM<BR>  </B></FONT><FONT SIZE=2>to the employment contract with<BR></FONT> <FONT SIZE=2><B>NOVEON SALES HOLLAND B.V. AND KEES VERHAAR<BR>  </B></FONT><FONT SIZE=2>signed on January&nbsp;1, 2003 </FONT></P>

<P><FONT SIZE=2>With
respect to the application of the 30%-facility, the following will be taken into account: </FONT></P>

<DL compact>
<DT style='margin-bottom:-11pt;'><FONT SIZE=2>1.</FONT></DT><DD><FONT SIZE=2>If,
and insofar, Kees Verhaar is, based on article&nbsp;9 of the 'Uitvoeringsbesluit loonbelasting 1965', entitled to receive a tax-free cost reimbursement for
extraterritorial costs, it has been agreed with Kees Verhaar that his current employment income ('loon uit tegenwoordige dienstbetrekking') as described in article&nbsp;9 of the 'Uitvoeringsbesluit
loonbelasting 1965', will be reduced according to labour law so that 100/70 of his current employment income equals the originally agreed employment income.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>2.</FONT></DT><DD><FONT SIZE=2>If,
and insofar, article&nbsp;1 is applicable, Kees Verhaar receives a cost reimbursement for extraterritorial costs from Noveon Sales Holland B.V. equal to <SUP>30</SUP>/<SMALL>70</SMALL> of
the current employment income as agreed in article&nbsp;1.
<BR><BR></FONT></DD><DT style='margin-bottom:-11pt;'><FONT SIZE=2>3.</FONT></DT><DD><FONT SIZE=2>Kees
Verhaar acknowledges the fact that an adjustment of the agreed remuneration of article&nbsp;1 can influence all employment income related payments and benefits like pension and
social security benefits. Nevertheless above-mentioned, pension will be built up over the reduced employment income as mentioned under article&nbsp;1 increased with the cost reimbursement for
extraterritorial cost as mentioned in article&nbsp;2. </FONT></DD></DL>

<P><FONT SIZE=2>Herewith,
Noveon Sales Holland B.V. and Kees Verhaar acknowledge the above. </FONT></P>

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<TD WIDTH="49%"><FONT SIZE=2>Kees Verhaar</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>Noveon Sales Holland B.V.<BR>
P. Poty</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>
<IMG SRC="g165222.jpg" ALT="GRAPHIC" WIDTH="348" HEIGHT="124">
 </B></FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%" ALIGN="CENTER"><FONT SIZE=2><B>
<IMG SRC="g285552.jpg" ALT="GRAPHIC" WIDTH="171" HEIGHT="87">
 </B></FONT></TD>
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<TD WIDTH="49%"><HR NOSHADE></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><HR NOSHADE></TD>
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<TD WIDTH="49%"><FONT SIZE=2>(signature)</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>(signature)</FONT></TD>
</TR>
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<TD WIDTH="49%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
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<TD WIDTH="49%"><FONT SIZE=2>Date: January 1, 2003</FONT></TD>
<TD WIDTH="2%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>Date: January 1, 2003</FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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