EX-10.1 2 a09-36903_1ex10d1.htm EX-10.1

Exhibit 10.1








Purpose and Objectives


The purpose of the Incentive Compensation Plan (Plan) is to contribute to the motivation of key employees in accomplishing the Company’s goals.  The objectives of the Plan are as follows:


·      Clearly communicate and reinforce strategic, operational and financial objectives.


·      Provide a competitive incentive for achievement of corporate and divisional goals on both an individual and team basis.


·      Establish an objective basis for determining annual awards.


Plan Definitions


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


·      Award - An annual incentive compensation award.


·      Base Salary — Base salary as of July 31st of the Plan Year (or a participant’s last day of employment with the Company if prior to July 31st), disregarding any reduction in the rate of base salary during the six-month period immediately preceding such date.


·      Company — Cantel Medical Corp.


·      Compensation Committee — a subgroup of the Company’s 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 incentive compensation award to be earned by a participant based on achieving pre-determined financial objectives and other performance objectives during the Plan Year that represents payment at 100%.




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.




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


·      Approving Annual Incentive Compensation Plan




·      Approving the performance objectives, targets and ranges


·      Determining incentive compensation award percentages


·      Approving incentive compensation awards


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


Prior to the commencement of each new Plan Year or within sixty (60) days thereafter, the Compensation Committee shall approve and adopt specific performance targets and target award levels for Plan participants for such year.  Such performance targets and target award levels shall be set forth in an Annual Incentive Compensation Plan.


Target Award Levels


The target incentive awards for each eligible position (by category) are expressed as a percentage of Base Salary as follows:








70% - 100%


COO, Division CEO, Senior Vice President


45% - 65%


Vice Presidents, Directors


40% - 55%


Other Key Employees


10% - 35%



Notwithstanding the foregoing, Division CEOs will have 25% of their Bonus Target based on the annual Performance Target established for executives of Cantel Medical Corp.  The remaining 75% will be based on the annual performance target specific to the operations of such CEO’s division(s), which shall be established by the CEO of the Company in consultation with the Compensation Committee.


Awards will be determined as follows:






















Payout Ranges


Payout ranges are based upon target incentive award and are expressed as a percentage of base salary as follows:










Financial Objective









Determination of Awards


To maintain a focus on increasing shareholder value and driving superior financial performance, awards under this Plan will be based on the achievement of growth in the Company’s earnings, as measured by earnings per share or on such other performance criteria as may be established by the Compensation Committee for each Plan Year and set forth in the Annual Incentive Compensation Plan. Notwithstanding the specific performance criteria established, in making a determination as to whether or not such criteria was satisfied and the extent to which a bonus should be awarded, 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.


Distribution of Awards


Awards under the Plan are to be paid to eligible participants in cash as soon as financial performance is finalized and individual performance has been assessed, but in no case later than October 15th.


Subject to the terms of a participant’s employment, severance or other written compensation agreement with the Company, a participant must be actively employed by the Company on the date the Award is paid to receive the Award.  Participants hired or promoted to an eligible position for participation in the Plan 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.


In the event a participant’s employment is terminated prior to the end of the Plan Year due to death, disability, or normal retirement, the participant or beneficiary will be entitled to receive the Award (in whole or on a pro rata basis for the period employed) that would have been earned if participant’s employment had continued to the end of 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 the amount of an Award may be decreased, due to substantiated poor individual performance or misconduct and may be declared ineligible under the Plan.  The 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.




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 the Plan at the beginning of each Plan Year at the sole discretion of the Compensation Committee by giving written notice to such participants at least thirty (30) days prior to the commencement of the Plan Year. New participants may be added to the Plan at any time 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.




Incentive compensation payments may not be pledged, assigned or transferred for any reason other than in connection with the death of a Participant.




Any taxes required to be withheld by Federal, State or Local Regulations will be deducted from incentive compensation payments hereunder.


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.  The Company may review the Plan and its administration at any time to determine whether the objectives of the Plan continue to be met.