Exhibit
10.2


 





 


CANTEL MEDICAL CORP.


 


LONG TERM INCENTIVE PLAN


 

















 


Purpose and Objectives


 


The purpose of the Long
Term Incentive Plan (Plan) is to contribute to the motivation of key employees
in accomplishing the Company’s long term strategic and shareholder value goals.  The specific objectives of the Plan are as
follows:


 


·                  Clearly communicate and reinforce strategic, operational and financial
objectives linked to creating shareholder value.


 


·                  Provide a competitive incentive for achievement of long term corporate shareholder
value goals.


 


·                  Establish an objective basis for determining annual long term incentive
Awards for eligible participants.


 


Plan
Definitions


 


Certain words or phases
used in this plan document are defined as follows:


 


·                  Award - An annual long term incentive equity award granted
under this Plan.


 


·                  Company — Cantel Medical Corp.


 


·                  Compensation Committee — a subgroup of the Board of Directors responsible for
the following functions: (1) discharging the Board’s responsibilities
relating to compensation of executive officers; (2) producing an annual
report on executive compensation for inclusion in the proxy statement; and (3) design,
maintenance and administration of all of the company’s incentive plans.


 


·                  Plan Year - The period from August 1st - July 31st (fiscal year of
Company). The initial Plan Year is the fiscal year ending July 31, 2010.


 


·                  Target Award - An Award granted to a participant based on eligibility
and achievement of EPS objectives and/or other performance objectives for the Plan
year established by the Compensation Committee that represents a grant at 100%.


 


·                  2006 Plan -  the Company’s
2006 Equity Incentive Plan.


 


Eligibility


 


All executive
officers of the Company, the Presidents of the Company’s Minntech Corporation, Mar
Cor Purification, Inc. and Crosstex International, Inc. subsidiaries
and other direct reports to the CEO of the Company who are approved by the
Compensation Committee are eligible for Awards under this Plan.  New hires/promotions are eligible for a pro-rated
Award. Participation will be based on a position’s level and ability to
influence the long term performance of the Company.  Participants are identified by title and
recommended by the CEO of Cantel Medical Corp., subject to the approval of the
Compensation Committee.


 


Administration


 


The Compensation
Committee has ultimate authority over the Plan, is responsible for approving
the Plan and may alter any provision of the Plan or terminate the Plan at any
time subject to the terms of the Plan 


 


2

















 


herein. The Compensation
Committee will directly administer the Plan with respect to all
participants.  Specific responsibilities
of the Committee include:


 


·                  Approving annual Awards made under the Plan


 


·                  Approving performance targets


 


·                  Determining Award levels and participation eligibility


 


The CEO of the Company
will make recommendations to the Compensation Committee and resolve questions
regarding the interpretation of the Plan.


 


All Awards granted
hereunder made under the 2006 Plan shall be subject to the terms and conditions
of the 2006 Plan.


 


Target
Grant Size


 


The annualized expected
value of the executives’ target Awards will be reviewed annually by the
Compensation Committee to ensure competitiveness with market trends.


 


Mix of
Targeted Award Value


 


All
participants will be eligible for an Award consisting of a mix of restricted
stock and stock options.


 


Performance
Measures


 


Performance based Awards will
be contingent on acceptable individual performance as well as predetermined
financial objectives of the Company or one or more of its subsidiaries or
operating segments determined by the Compensation Committee. Performance based Awards will vest
upon achievement of the designated performance criteria. Notwithstanding the
specific performance criteria established, in making a determination as to
whether or not such criteria such as earnings growth was achieved, the
Compensation Committee shall take into consideration factors such as
unanticipated taxes, acquisition costs, non-recurring and extraordinary items,
and other equitable factors, as determined by the Compensation Committee in its
discretion.


 


Vesting
Period for Service-based Awards


 


Service-based
Awards will vest ratably over three (3) years following the date of grant,
or such other period of time determined by the Compensation Committee, subject
to the terms and conditions set forth in the 2006 Plan and the agreement
reflecting the Award.


 


Award
Term


 


The
term of each Award will be determined by the Compensation Committee.


 


Effect
of Termination


 


If a participant
voluntarily terminates his employment with the Company for any reason other
than “Good Reason,” or “Adequate Reason” or normal retirement, or if the
Company terminates a participant’s employment for “Cause” or “Unacceptable
Performance” then the participant will forfeit any non-vested Awards (as such
capitalized terms are defined in a participant’s employment, severance or other
agreement).


 


3

















 


In the event of a termination of a participant’s employment (i) by a
participant for “Good Reason” or “Adequate Reason” or (ii) by the Company
other than for “Cause” or “Unacceptable Performance” (as such capitalized terms
are defined in the participant’s employment, severance of other agreement) prior to the full vesting of the options and restricted stock held by the
participant (i.e., the Options becoming exercisable in their entirety and the
restricted stock ceasing to have any risks of forfeiture), then, on or effective
as of the termination date of employment, the annual installment of such options and restricted stock that is due to vest on the first
vesting date following the termination date shall accelerate and vest on a pro
rata basis based on the number of days elapsed from the prior vesting date of
such options and restricted stock to and including the termination date unless
the Company delivers written notice to the participant on or before the termination
date stating that such pro rata vesting of such options and restricted stock
will not occur.


 


In the event a
participant’s employment is terminated prior to the end of the vesting period
due to death, disability, or normal retirement, the participant or beneficiary
will be entitled to receive accelerated vesting (in whole or on a pro rate
basis for the period employed) that would have been earned if the participant’s
employment had continued to the end of the then current Plan Year, subject to
the terms of the agreement granting the Award or the approval of the
Compensation Committee and subject to the terms of the 2006 Plan.


 


Effect
of a Change in Control


 


All restrictions of
restricted stock Awards will automatically lapse and vesting of stock option
Awards will automatically accelerate upon a change in control, consistent with
the terms of the 2006 Plan.


 


Distribution of Awards


 


Within seventy-five (75)
days following each Plan Year, the Compensation Committee shall (a) review
the Company’s performance and individual performances of participants during
such Plan Year, (b) review all performance based Awards granted or to be
granted during or with respect to such Plan Year to determine whether or not
the requisite performance targets were achieved, (c) based on such review,
take such actions that are required in connection with the granting, vesting or
forfeiture of such Awards (based on the terms thereof) and (d) develop and
adopt a summary plan including performance based requirements and Award targets,
if any, for the following Plan Year.  The
summary plan for each Plan Year shall be delivered to the Board promptly
following its adoption by the Compensation Committee.


 


A participant must be
actively employed by the Company on the date Awards are made to receive a new Award.  Participants hired or promoted to an eligible
position during the Plan year may receive a pro-rated Award (based on time in
the eligible position during the Plan year) subject to the approval of the
Compensation Committee.


 


At the sole discretion of the Compensation Committee, a participant may
not receive an Award or may receive a reduced Award due to substantiated poor
individual performance or misconduct and may be declared ineligible under the Plan.
The Compensation Committee intends to provide written notice to such participant
promptly following its knowledge or determination of poor individual
performance or misconduct and give the participant an opportunity to dispute or
explain his performance or misconduct and, to the extent practical, correct any
correctible poor performance; provided, however, that the failure to provide
such notice shall not affect the Committee’s rights under this paragraph.


 


4

















 


General
Provisions


 


Limitations
on Vested Interest


 


It is
understood that the Awards hereunder are within the sole discretion of the
Company.  No participant has any vested
interest in an Award under the Plan until such Award has been approved by the
Compensation Committee.


 


Participants may be deleted from or added to the Plan each year at the
sole discretion of the Compensation Committee.


 


Employment Rights


 


The Plan does not give
any employee the right to be retained in the employ of the Company.  Specifically, the Plan does not create an
employment contract for the Plan year or any part thereof.


 


Non-Assignment


 


Awards may not be
pledged, assigned or transferred for any reason.


 


Discontinuance,
Suspension or Amendment of the Plan


 


The Company, with the
approval of the Compensation Committee, may discontinue or suspend the Plan at
any time, or amend the Plan in any respect; provided, however, that no
discontinuance, suspension or amendment may adversely affect any then
outstanding Award without the consent of the holder of such Award.  The Company may review the Plan and its
administration at any time to determine whether the objectives of the Plan
continue to be met.  Where appropriate,
the Compensation Committee may make changes in the Plan.


 


5