STOCK OPTION AGREEMENT made as of the 15th day of December 1994, by
and between CANTEL INDUSTRIES, INC., a Delaware corporation with principal
offices located at 1135 Broad Street, Clifton, New Jersey 07013 (the "Company"),
and ROBERT L. BARBANELL, 35 Sutton Place, New York, New York 10022 (the
"Optionee").
--------------------
The Optionee is presently a director of the Company and is hereby
granted an option to purchase shares of the Company's Common Stock, par value
$.10 per share ("Common Stock"), on the terms and conditions set forth below.
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, receipt of which is hereby acknowledged, the Company
hereby grants the Optionee the option to acquire shares of the Common Stock of
the Company upon the following terms and conditions:
1. GRANT OF OPTION.
(a) The Company hereby grants to the Optionee the right and
option (the "Option") to purchase up to 25,000 shares of Common Stock (the
"Shares"), to be issued upon the exercise hereof, fully paid and non-assessable,
during the following periods:
(i) No shares may be purchased hereunder prior to December
15, 1994; (ii) 6,250 Shares may be purchased commencing
March 15, 1995; (iii) an additional 6,250 Shares may be
purchased commencing June 15, 1995; (iv) an additional 6,250
Shares may be purchased commencing September 15, 1995; and
(v) an additional 6,250 Shares may be purchased commencing
December 15, 1995.
(b) The Option granted hereby shall expire and terminate at 5:00
p.m. local time in New York, New York on December 14, 1999 (the "Expiration
Date") at which time the Optionee shall have no further right to purchase any
Shares not then purchased.
2. EXERCISE PRICE. The exercise price of the Option shall be $3.75
per Share, and shall be payable in cash or by certified check; provided,
however, that in lieu of payment in full in cash or by such check, the exercise
price (or balance thereof) may be paid in full or in part by the delivery and
transfer to the Company of Shares already owned by the Optionee and having a
fair market value (as determined by the Board of Directors in its absolute
discretion) equal to the cash exercise price (or balance thereof) for the number
of Shares as to which the Option is being exercised. The Company shall pay all
original issue or transfer taxes on the exercise of the Option.
3. EXERCISE OF OPTION. The Optionee shall notify the Company by
registered or certified mail, return receipt requested, addressed to its
principal office, as to the number of Shares which he desires to purchase under
the Option, which notice shall be accompanied by payment of the Option
exercise price therefor as specified in Paragraph 2 above. As soon as
practicable after the receipt of such notice, the Company shall, at its
principal office or another mutually convenient location, tender to the
Optionee certificates issued in the Optionee's name evidencing the Shares
purchased by the Optionee hereunder.
-2-
4. CONDITIONS OF EXERCISE. The Optionee (or his legal representative
following the death of the Optionee) shall have the right to exercise the Option
only while the Optionee is a director of the Company; provided, however, the
Option may be exercised at any time within three (3) months after the date the
Optionee ceases to be a director, but only to the extent that it was exercisable
upon such date of termination and in no event after the Expiration Date.
5. NON-ASSIGNABILITY OF OPTION. The Optionee may not give, grant,
sell, exchange, transfer legal title, pledge, assign or otherwise encumber or
dispose of the Option herein granted or any interest therein, otherwise than by
will or the laws of descent and distribution and, except as provided in
Paragraph 4 hereof, the Option shall be exercisable only by the Optionee.
6. THE SHARES AS INVESTMENT. By accepting the Option, the Optionee
agrees for himself, his heirs and legatees that any and all Shares purchased
upon the exercise thereof shall be acquired for investment and not for
distribution, and upon the issuance of any or all of the Shares subject to the
Option, the Optionee, or his heirs or legatees receiving such Shares, shall
deliver to the Company a representation in writing that such Shares are being
acquired in good faith for investment and not
-3-
for distribution. The Company may place a "stop transfer" order with respect to
such Shares with its transfer agent and may place an appropriate restrictive
legend on the certificate(s) evidencing such Shares.
7. RESTRICTION ON ISSUANCE OF SHARES. The Optionee shall, if so
requested by the Company, represent and agree, in writing and in such form as
the Company shall determine, that any securities purchased by the Optionee upon
the exercise of this Option are being purchased for investment and not with a
view to the distribution thereof, and shall make such other or additional
representations and agreements and furnish such information as the Company may
in its reasonable discretion deem necessary or desirable to assure compliance by
the Company, on terms acceptable to the Company, with provisions of the
Securities Act of 1933 and any other applicable legal requirements. If at any
time the Company shall reasonably determine that the listing, registration or
qualification of the Shares subject to this Option upon any securities exchange
or under any state or federal law, or the consent or approval of any
governmental regulatory body, are necessary or desirable in connection with the
issuance or purchase of the Shares subject thereto, this Option may not be
exercised in whole or in part unless such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Company. The Optionee shall
-4-
have no rights against the Company if this Option is not exerciseable by virtue
of the foregoing provision. The certificate representing any securities issued
pursuant to the exercise of this Option may, at the discretion of the Company,
bear a legend in substantially the following form:
"The securities represented by this certificate have not
been registered under the Securities Act of 1933. The
securities have been acquired for investment and may not be
pledged or hypothecated and may not be sold or transferred
in the absence of an effective Registration Statement for
the securities under the Securities Act of 1933 or an
opinion of counsel to the Company that registration is not
required under said Act. In the event that a Registration
Statement becomes effective covering the securities or
counsel to the Company delivers a written opinion that
registration is not required under said Act, this
certificate may be exchanged for a certificate free from
this legend."
8. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
(a) In the event of changes in the outstanding Shares by reason
of stock dividends, split-ups, recapitalizations, mergers, consolidations,
combination, exchanges of shares, separations, reorganizations, liquidations and
the like, the number and class of Shares or the amount of cash or other assets
or securities available upon the exercise of the Option and the exercise price
thereof shall be correspondingly adjusted by the Company, to the end that the
Optionee's proportionate interest in the Company, any successor thereto or in
the cash, assets or other securities into which
-5-
shares are converted or exchanged shall be maintained to the same extent, as
near as may be practicable, as immediately before the occurrence of any such
event.
(b) Any adjustment in the number of Shares shall apply
proportionately to only the then unexercised portion of the option. if
fractional Shares would result from any such adjustment, the adjustment shall be
revised to the next higher whole number.
9. NO RIGHTS AS SHAREHOLDERS. The Optionee shall have no rights as
a shareholder in respect of the Shares as to which the Option shall not have
been exercised and payment made as herein provided.
10. BINDING EFFECT. Except as herein otherwise expressly provided,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto, their legal representatives and assigns.
11. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New Jersey applicable to agreements
made and to be performed wholly within the State of New Jersey.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
CANTEL INDUSTRIES, INC.
By: /s/ James P. Reilly
-----------------------------------
James P. Reilly, President
/s/ Robert L. Barbanell
-----------------------------------
Robert L. Barbanell
-6-