-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AuVuQCIzMMlG2o2QIxUBAEF5Zy+fdp9VKrg2g9ev7GyJyQAHG9osgT7Q632E3aX1 AjCszBHEcZ8LQ0p/G3YGmA== 0000950123-98-008771.txt : 19981007 0000950123-98-008771.hdr.sgml : 19981007 ACCESSION NUMBER: 0000950123-98-008771 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19981006 EFFECTIVENESS DATE: 19981006 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: I STAT CORPORATION /DE/ CENTRAL INDEX KEY: 0000882365 STANDARD INDUSTRIAL CLASSIFICATION: ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845] IRS NUMBER: 222542664 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-65357 FILM NUMBER: 98721256 BUSINESS ADDRESS: STREET 1: 303A COLLEGE RD EAST CITY: PRINCETON STATE: NJ ZIP: 08540 BUSINESS PHONE: 6092439300 MAIL ADDRESS: STREET 1: 303 COLLEGE ROAD EAST CITY: PRINCETON STATE: NJ ZIP: 08540 S-8 1 I-STAT CORPORATION: 1998 STOCK OPTION PLAN 1 As filed with the Securities and Exchange Commission on October 6, 1998 Registration No. 33- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 i-STAT CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 22-2542664 (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 104 WINDSOR CENTER DRIVE 08520 EAST WINDSOR, NEW JERSEY (Zip Code) (Address of Principal Executive Offices) i-STAT CORPORATION 1998 STOCK OPTION PLAN (Full title of the plan) ROGER J. MASON WITH A COPY TO: VICE PRESIDENT OF FINANCE, TREASURER AND CHIEF FINANCIAL OFFICER ESTEBAN A. FERRER, ESQ. i-STAT CORPORATION PAUL, HASTINGS, JANOFSKY & WALKER LLP 104 WINDSOR CENTER DRIVE 1055 WASHINGTON BOULEVARD EAST WINDSOR, NEW JERSEY 08520 STAMFORD, CONNECTICUT 06901 (Name and address of agent for service) TELEPHONE: (203) 961-7400 (609) 443-9300 (Telephone number, including area code, of agent for service) CALCULATION OF REGISTRATION FEE
Proposed Proposed TITLE OF Maximum Maximum SECURITIES Amount Offering Aggregate Amount of TO BE to be Price Offering Registration REGISTERED Registered(1) Per Share Price Fee Common Stock, 2,300,000 $6.78125 $15,596,875 $4,601.08 Par Value $.15
(1) Pursuant to Rule 416(b) of the Securities Act of 1933, as amended (the "Securities Act"), this amount shall be deemed to cover securities resulting from the split of, or the stock dividend on, or any other anti-dilution mechanisms on, the registered securities. (2) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c), based on the average of the high and low prices ($6.78125 per share) of the Common Stock of the Registrant on the NASDAQ National Market System on October 2, 1998. 2 PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS ITEM 1. PLAN INFORMATION.* ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.* *Pursuant to the Note to Part I of Form S-8, the information required by Part I is not being filed with the Securities and Exchange Commission. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE. (a) The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997, filed on March 23, 1998 pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as amended through the date hereof. (b) The Company's Quarterly Reports on Form 10-Q for the quarters ended (i) March 31, 1998, filed on April 29, 1998 and (ii) June 30, 1998, filed on August 14, 1998, pursuant to Section 13 or 15(d) of the Exchange Act. (c) The Company's Current Reports on Form 8-K dated (i) August 4, 1998 and (ii) September 17, 1998, pursuant to Section 13 or 15(d) of the Exchange Act. (d) The description of the Company's Common Stock contained in the Company's (i) Registration Statement on Form 8-A (File No. 0-19841) filed on February 3, 1992 and (ii) Registration Statement on Form 8-A (File No. 0-19841) filed on July 12, 1995, under Section 12(g) of the Exchange Act, including any amendments or reports filed for the purpose of updating such descriptions. (e) All reports and other documents subsequently filed by the Company pursuant to Section 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference herein and to be part hereof from the date of the filing of such reports and documents. ITEM 4. DESCRIPTION OF SECURITIES. Not applicable. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Counsel for the Registrant, Paul, Hastings, Janofsky & Walker LLP, 1055 Washington Boulevard, Stamford, Connecticut 06901, has rendered an opinion to the Registrant to the effect that the shares of Common Stock registered hereby have been duly authorized and will be, upon original issuance pursuant to the terms of the 1998 Stock Option Plan, legally and validly issued, fully paid and non-assessable. Esteban A. Ferrer, Secretary of the Registrant, is a partner of Paul, Hastings, Janofsky & Walker LLP. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Article VIII of the Bylaws of the Company, as amended, provides generally for indemnification of officers, directors, agents and employees of the Company to the extent authorized by the General Corporation -1- 3 Law of the State of Delaware. Pursuant to Section 145 of the Delaware General Corporation Law, a corporation generally has the power to indemnify its present and former directors, officers, employees and agents against expenses incurred by them in connection with any suit to which they are, or are threatened to be made, a party by reason of their serving in such positions so long as they acted in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interests of a corporation, and with respect to any criminal action, they had no reasonable cause to believe their conduct was unlawful. With respect to suits by or in the right of a corporation, however, indemnification is not available if such person is adjudged to be liable for negligence or misconduct in the performance of his duty to the corporation unless the court determines that indemnification is appropriate. In addition, a corporation has the power to purchase and maintain insurance for such persons. The statute also expressly provides that the power to indemnify authorized thereby is not exclusive of any rights granted under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise. As permitted by Section 102 of the Delaware General Corporation Law, the Company's stockholders have approved and incorporated provisions into the Company's Restated Certificate of Incorporation eliminating a director's personal liability for monetary damages to the Company and its stockholders arising from a breach of a director's fiduciary duty, except for liability under Section 174 of the Delaware General Corporation Law or liability for any breach of the director's duty of loyalty to the Company or its stockholders, for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law or for any transaction in which the director derived an improper personal benefit. The Company has entered into indemnification agreements with directors and officers. These agreements provide substantially broader indemnity rights than those provided under the Delaware General Corporation Law and the Company's Bylaws. The indemnification agreements are not intended to deny or otherwise limit third party or derivative suits against the Company or its directors or officers, but to the extent a director or officer were entitled to indemnity or contribution under the indemnification agreement, the financial burden of a third party suit would be borne by the Company, and the Company would not benefit from derivative recoveries against the director or officer. Such recoveries would accrue to the benefit of the Company but would be offset by the Company's obligations to the director or officer under the indemnification agreement. The above discussion of the Company's Bylaws, Restated Certificate of Incorporation and indemnification agreements and of Section 145 of the Delaware General Corporation Law is not intended to be exhaustive and is qualified in its entirety by such Bylaws, Restated Certificate of Incorporation, indemnification agreements and statute. ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not applicable. ITEM 8. EXHIBITS. The exhibits filed as part of this Registration Statement are as follows: -2- 4 EXHIBIT NO. DESCRIPTION 4.1 Restated Certificate of Incorporation of i-STAT Corporation (Form S-8/S-3 Registration Statement, File No. 33-48889)* 4.2 Bylaws, as amended (Form 10-K for the fiscal year ended December 31, 1996)* 4.3 1998 Stock Option Plan 4.4 Specimen of Common Stock Certificate (Form S-1, Registration Statement, File No. 33-44800)* 4.5 Stockholder Protection Agreement, dated as of June 26, 1995, between the Registrant and First Fidelity Bank, National Association (Form 8-K, dated July 10, 1995 and amended September 11, 1995)* 5 Opinion of Paul, Hastings, Janofsky & Walker LLP 23.1 Consent of PricewaterhouseCoopers LLP 23.2 Consent of Paul, Hastings, Janofsky & Walker LLP (contained in Exhibit 5) 24.1 Power of Attorney (contained on the Signature Page of this Registration Statement) * These items are hereby incorporated by reference from the exhibits of the filing or report indicated (except where noted, Commission File No. 0-19841) and are hereby made a part of this Registration Statement. ITEM 9. UNDERTAKINGS. (a) The undersigned Registrant hereby undertakes: (1) That, for the purpose of determining any liability under the Securities Act, each post-effective amendment to this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (2) To remove from registration by means of a post-effective amendment to this Registration Statement any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions or otherwise, the Registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being -3- 5 registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. -4- 6 SIGNATURES Pursuant to the requirements of the Securities Act, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of East Windsor, State of New Jersey, on October 6, 1998. i-STAT CORPORATION By /s/ Roger J. Mason ----------------------------------------- Roger J. Mason Vice President of Finance, Treasurer and Chief Financial Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints William P. Moffitt and Roger J. Mason, or either of them, his attorney-in-fact, each with the power of substitution, for him in any and all capacities, to sign any amendments to this Registration Statement, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue thereof. Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date - --------- ----- ---- /s/ William P. Moffitt President, Chief Executive Officer October 6, 1998 - ------------------------------------------ and Director (Principal Executive William P. Moffitt Officer) /s/ Roger J. Mason Vice President of Finance, Treasurer October 6, 1998 - ------------------------------------------ and Chief Financial Officer Roger J. Mason (Principal Financial Officer and Principal Accounting Officer) /s/ Imants R. Lauks Executive Vice President October 6, 1998 - ------------------------------------------ and Chief Technology Imants R. Lauks Officer and Director /s/ J. Robert Buchanan Director October 6, 1998 - ----------------------------------------- J. Robert Buchanan /s/ Curtis J. Crawford Director October 6, 1998 - ------------------------------------------ Curtis J. Crawford
-5- 7
/s/ James A. Cyrier Director October 1, 1998 - ------------------------------------------- James A. Cyrier /s/ Richard Hodgson Director October 6, 1998 - ------------------------------------------- Richard Hodgson /s/ Lionel N. Sterling Director October 6, 1998 - ------------------------------------------- Lionel N. Sterling
-6- 8 EXHIBIT INDEX EXHIBIT NO. DESCRIPTION 4.3 1998 Stock Option Plan 5 Opinion of Paul, Hastings, Janofsky & Walker LLP 23.1 Consent of PricewaterhouseCoopers LLP 23.2 Consent of Paul, Hastings, Janofsky & Walker LLP (contained in Exhibit 5) 24.1 Power of Attorney (contained on the Signature Page of this Registration Statement) -7- EX-4.3 2 1998 STOCK OPTION PLAN 1 Exhibit 4.3 i-STAT CORPORATION 1998 STOCK OPTION PLAN 1. Purpose. The purpose of this plan (the "Plan") is to secure for i-STAT Corporation (the "Company") and its stockholders the benefits arising from capital stock ownership by employees and members of the Board of Directors of, and consultants and advisors to, the Company and its parent and subsidiary corporations, if any, who are expected to contribute to the Company's future growth and success. 2. Types of Options and Administration. (a) Types of Options. Options granted pursuant to the Plan shall be authorized by action of the Board of Directors of the Company (or a Committee designated by the Board of Directors) and may be either incentive stock options ("Incentive Stock Options") meeting the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), or non-statutory options which are not intended to meet the requirements of Code Section 422. (b) Administration. The Plan will be administered by the Board of Directors of the Company, whose construction and interpretation of the terms and provisions of the Plan shall be final and conclusive. Except as provided in Subsection 2(c) below, the Board of Directors may in its sole discretion grant options to purchase shares of the Company's Common Stock, par value $.15 per share ("Common Stock"), and authorize the Company to issue shares upon exercise of such options as provided in the Plan. The Board shall have authority, subject to the express provisions of the Plan, to construe the respective option agreements and the Plan, to prescribe, amend and rescind 2 rules and regulations relating to the Plan, to determine the terms and provisions of the respective option agreements, which need not be identical, to advance the lapse of any waiting or installment periods and exercise dates, and to make all other determinations in the judgment of the Board of Directors necessary or desirable for the administration of the Plan. The Board of Directors may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any option agreement in the manner and to the extent it shall deem expedient to carry the Plan into effect and it shall be the sole and final judge of such expediency. No director shall be liable for any action or determination taken or made under or with respect to the Plan or to any option in good faith. The Board of Directors may, to the full extent permitted by law, delegate any or all of its powers under the Plan to a committee (the "Committee") of two or more directors each of whom is a Non-Employee Director (as hereinafter defined), and if the Committee is so appointed all references to the Board of Directors in the Plan shall mean and relate to such Committee. For the purposes of the Plan, a director or member of such Committee shall be deemed to be a "Non-Employee Director" only if such person qualifies as a "Non-Employee Director" within the meaning of paragraph (b)(3) of Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended (or any successor rule). (c) Limitation on Options Granted in Any Twelve Months. No individual may be granted, in any twelve-month period, options under the Plan which are exercisable with respect to more than 200,000 shares of Common Stock. 3. Eligibility. Options shall be granted only to persons who are, at the time of grant, officers, employees or directors of, or consultants or advisors to, (provided, in the case of Incentive Stock Options, such directors or officers are then also employees of) the Company or of any Parent Corporation -2- 3 or Subsidiary (as defined in Section 19 hereof). A person who has been granted an option may, if he or she is otherwise eligible, be granted an additional option or options if the Board of Directors shall so determine. 4. Stock Subject to Plan. Subject to adjustment as provided in Sections 15 and 16 below, the maximum number of shares of Common Stock of the Company which may be issued and sold pursuant to options granted under the Plan is 2,300,000 shares. Such shares may be authorized and unissued shares or may be shares issued and thereafter acquired by the Company. If an option granted under the Plan shall expire or terminate for any reason without having been exercised in full, the unpurchased shares subject to such option shall again be available for subsequent option grants under the Plan. Stock issuable upon exercise of an option granted under the Plan may be subject to transfer restrictions, repurchase rights or other restrictions as shall be determined by the Board of Directors. 5. Option Agreements. As a condition to the grant of an option under the Plan, each recipient of an option shall execute an option agreement not inconsistent with the Plan in such form as the Board of Directors shall determine at the time such option is authorized to be granted. Such agreements need not be identical but shall comply with, and be subject to, the terms and conditions set forth herein. 6. Purchase Price. (a) The purchase price per share of Common Stock deliverable upon the exercise of an option shall be not less than the fair market value of the Common Stock as determined by the Board of Directors on the date such option is authorized to be granted. The "fair market value" of the -3- 4 Company's Common Stock on any date (the "Value Date") shall mean (i) the closing price of the Common Stock, as reported on the National Association of Securities Dealers Automated Quotation System or, if the Common Stock is listed on a stock exchange, the principal stock exchange on which the Common Stock is listed, on the last trading day prior to the Value Date for which a closing price is available, or (ii) if the Board of Directors determines, in the exercise of its business judgment, that such closing price does not properly reflect the fair market value of the Common Stock on the Value Date, then such other price as may then be determined in good faith by the Board of Directors. If the Common Stock is not reported on the National Association of Securities Dealers Automated Quotation System or listed on any stock exchange, then the "fair market value" shall be determined in good faith by the Board of Directors. (b) Payment of the exercise price of an option shall be in cash or, in the sole discretion of the Board of Directors, in capital stock of the Company, by the surrender of other options to purchase capital stock of the Company or by any other lawful means. The Company may, in its sole discretion, make loans to an optionee in an amount equal to all or part of the exercise price of options held by such optionee; provided that the grant of a loan on any occasion to one or more optionees shall not obligate the Company to grant loans on any other occasion or to any other optionee. 7. Option Term. Each option and all rights thereunder shall expire on such date as the Board of Directors shall determine on the date such option is authorized to be granted, but in no event after the expiration of ten years from the day on which the option is granted (or five years in the case of options described in paragraph (b) of Section 11), and shall be subject to earlier termination as provided in the Plan. Notwithstanding the foregoing, except as provided under or pursuant to the Code with respect to -4- 5 Incentive Stock Options, if at any time during the last six (6) months of the term of any option granted under the Plan, the holder thereof is precluded from selling shares of Common Stock underlying such option solely by reason of the application to such optionee of the Company's "Policy Regarding Confidential Information" (or similar successor policy), the term of such option shall be deemed automatically extended by a period equal to six (6) months beginning with the first day during which such optionee shall no longer be so precluded. 8. Exercise of Options. Each option granted under the Plan shall be exercisable either in full or in installments at such time or times during such period as shall be set forth in the agreement evidencing such option; provided, however, that, subject to Section 7, (i) no option granted under the Plan shall have a term in excess of ten years from the date of grant (or five years in the case of options described in paragraph (b) of Section 11) and (ii) the periods of time following the optionee's cessation of employment with the Company or service as an Outside Director of or consultant or advisor to the Company, or the optionee's death or disability, during which an option may be exercised, as provided in paragraphs (a), (b) and (c) of Section 10, shall not be included for purposes of determining the number of shares of Common Stock with respect to which an option granted under the Plan may be exercised. 9. Transfer Restrictions. Except as otherwise approved by the Board of Directors, no option granted under the Plan shall be assignable or transferable by the person to whom it is -5- 6 granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution. Subject to the preceding sentence, during the life of the recipient, the option shall be exercisable only by or on behalf of such person. 10. Effect of Termination of Employment. Notwithstanding anything contained in this Plan to the contrary, no option may be exercised unless, at the time of such exercise, the optionee is, and has been continuously since the date of grant of his or her option, employed by one or more of the Company, a Parent Corporation or a Subsidiary, except that if and to the extent the option agreement or instrument so provides: (a) the option may be exercised within the period of three months after the date the optionee ceases to be employed by or to serve as an Outside Director of or consultant or advisor to any of the foregoing entities (or within such lesser period as may be specified in the option agreement or instrument) for any reason other than death or disability; (b) if the optionee dies while in the employ of, or serving as an Outside Director of or consultant or advisor to, the Company, a Parent Corporation or a Subsidiary or within three months after the optionee ceases to be such an employee, director, consultant or advisor, the option may be exercised by the person to whom it is transferred by will or the laws of descent and distribution within the period of one year after the date of death (or within such lesser period as may be specified in the option agreement or instrument); and (c) if the optionee becomes disabled (within the meaning of Section 22(e)(3) of the Code) while in the employ of or while serving as an Outside Director of or consultant or advisor to the Company, a Parent Corporation or a -6- 7 Subsidiary, the option may be exercised within the period of one year after the date the optionee ceases to be an employee or director of, or consultant or advisor to, any of the foregoing entities because of such disability (or within such lesser period as may be specified in the option agreement or instrument); provided, however, that in no event may any option be exercised after the expiration date of the option. For all purposes of the Plan and any option granted hereunder, "employment" shall be defined in accordance with the provisions of Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations). 11. Incentive Stock Options. Options granted under the Plan which are intended to be Incentive Stock Options shall be specifically designated as Incentive Stock Options and shall be subject to the following additional terms and conditions: (a) Dollar Limitation. The aggregate fair market value (determined as of the respective date or dates of the grant) of the Common Stock with respect to which Incentive Stock Options granted to any employee under the Plan (and under any other incentive stock option plans of the Company, and any Parent Corporation and Subsidiary) are exercisable for the first time shall not exceed $100,000 in any one calendar year. In the event that Section 422 of the Code is amended to alter the limitation set forth therein so that following such amendment such limitation shall differ from the limitation set forth in this paragraph (a), the limitation of this paragraph (a) shall be automatically adjusted accordingly. (b) 10% Stockholder. If any employee to whom an Incentive Stock Option is to be granted under the Plan is at the time of the grant of such option the owner of stock possessing more than 10% of the total combined voting power -7- 8 of all classes of stock of the Company or of any Parent Corporation or any Subsidiary, then the following special provisions shall be applicable to the Incentive Stock Option granted to such individual: (i) The purchase price per share of the Common Stock subject to such Incentive Stock Option shall not be less than 110% of the fair market value of one share of Common Stock at the time of grant; and (ii) The option exercise period shall not exceed five years from the date of grant. Except as modified by the preceding provisions of this Section 11, all the provisions of the Plan shall be applicable to Incentive Stock Options granted hereunder. 12. Annual Automatic Grants of Options to Outside Directors. (a) Annual Automatic Grants of Options to Outside Directors. Each director of the Company who is not an employee of the Company or of any Parent Corporation or Subsidiary (each, an "Outside Director") shall be granted under the Plan (i) on the date of his or her first election to the Board of Directors of the Company, non-statutory options to purchase up to 20,000 shares of Common Stock and (ii) on the date of each annual meeting of the Company's stockholders at which such Outside Director is re-elected to the Board of Directors, non-statutory options to purchase up to 5,000 shares of Common Stock. (b) Additional Automatic Grants of Options to Outside Director Serving as Chairman of the Board of Directors. An Outside Director first elected as Chairman of the Board of Directors (the "Chairman") shall be granted under the Plan (i) on the date of his or her first election as Chairman, in addition to such Outside Director's grant pursuant to Section 12(a)(i) above, non-statutory options to -8- 9 purchase up to 5,000 shares of Common Stock and (ii) on each date following his or her re-election by the stockholders of the Company as an Outside Director on which he or she is re-elected by the Board of Directors as Chairman, in addition to such Outside Director's grant pursuant to Section 12(a)(ii) above, non-statutory options to purchase up to 2,000 shares of Common Stock. (c) Terms and Conditions of Options. Any option granted to an Outside Director pursuant to this Section 12 shall be exercisable over a three year period with respect to the following percentages of the number of shares originally underlying such option (i) 50% after the first anniversary of the date of grant and (ii) an additional 25% after each of the second and third anniversaries of the date of grant, in each case at a purchase price equal to the fair market value of such Common Stock, as defined in Section 6 above, on the date of grant. Each such option shall expire ten years after the date of grant and shall be subject to earlier termination as provided in the Plan. Notwithstanding the foregoing, if at any time during the last six (6) months of the term of any option granted pursuant to this Section 12, the holder thereof is precluded from selling shares of Common Stock underlying such option solely by reason of the application to such Outside Director of the Company's "Policy Regarding Confidential Information and Insider Trading" (or any similar successor policy), the term of such option shall be deemed automatically extended by a period equal to six (6) months beginning with the first day during which such Outside Director shall no longer be so precluded. (d) Plan Applicable. Except as set forth in this Section 12, all the provisions of the Plan shall be applicable to options granted to Outside Directors hereunder. -9- 10 13. General Restrictions. (a) Investment Representations. The Company may require any person to whom an option is granted, as a condition of exercising such option, to give written assurances in substance and form satisfactory to the Company to the effect that such person is acquiring the Common Stock subject to the option for his own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate in order to comply with federal and applicable state securities laws. (b) Compliance With Securities Laws. Each option shall be subject to the requirement that, if at any time counsel to the Company shall determine that the listing, registration or qualification of the shares subject to such option upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, is necessary as a condition of, or in connection with, the issuance or purchase of shares thereunder, such option may not be accepted or exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected or obtained on conditions acceptable to the Board of Directors. Nothing herein shall be deemed to require the Company to apply for or to obtain such listing, registration or qualification. 14. Rights as a Stockholder. The holder of an option shall have no rights as a stockholder with respect to any shares covered by the option until the date of issue of a stock certificate to him or her for such shares. Except as otherwise expressly provided in the Plan, no adjustment shall be made for dividends or other rights for which the record date is prior to the date such stock certificate is issued. -10- 11 15. Recapitalization. In the event that the outstanding shares of Common Stock of the Company are changed into or exchanged for a different number or kind of shares or other securities of the Company by reason of any recapitalization, reclassification, stock split, stock dividend, combination or subdivision, appropriate adjustment shall be made in the number and kind of shares available under the Plan and under any options granted under the Plan. Such adjustment to outstanding options shall be made without change in the total price applicable to the unexercised portion of such options, and a corresponding adjustment in the applicable option price per share shall be made. No such adjustment shall be made which would, within the meaning of any applicable provisions of the Code, constitute a modification, extension or renewal of any option or a grant of additional benefits to the holder of an option. 16. Reorganization or Change in Control of the Company. (a) Reorganization. In case (i) the Company is merged or consolidated with another corporation and the Company is not the surviving corporation, (ii) all or substantially all of the assets or more than 50% of the outstanding voting stock of the Company is acquired by any other corporation or (iii) of a reorganization or liquidation of the Company, the Board of Directors of the Company, or the board of directors of any corporation assuming the obligations of the Company, shall, as to outstanding options, either (x) make appropriate provision for the protection of any such outstanding options by the substitution on an equitable basis of appropriate stock of the Company, or of the merged, consolidated or otherwise reorganized corporation which will be issuable in respect of the shares of Common Stock of the Company, provided that no additional benefits shall be conferred upon optionees as a result of such substitution, and the excess of the aggregate -11- 12 fair market value of the shares subject to the options immediately after such substitution over the purchase price thereof is not more than the excess of the aggregate fair market value of the shares subject to the option immediately before such substitution over the purchase price thereof, or (y) upon written notice to the optionees, provide that all unexercised options must be exercised within a specified number of days of the date of such notice or they will be terminated. In any such case, the Board of Directors may, in its discretion, accelerate the exercise dates of outstanding options; provided, however, that paragraph (b) shall govern acceleration of options with respect to the events described in clauses (i), (ii) and (iii) of such paragraph. (b) Change in Control. In case of (i) any consolidation or merger involving the Company if the shareholders of the Company immediately before such merger or consolidation do not own, directly or indirectly, immediately following such merger or consolidation, more than fifty percent (50%) of the combined voting power of the outstanding voting securities of the corporation resulting from such merger or consolidation in substantially the same proportion as their ownership of the shares of Common Stock immediately before such merger or consolidation; (ii) any sale, lease, license, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the business and/or assets of the Company or assets representing over 50% of the operating revenue of the Company; or (iii) any person (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) who is not, on April 21, 1995, a "controlling person" (as defined in Rule 405 under the Securities Act of 1933, as amended) (a "Controlling Person") of the Company shall become (x) the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act) of over 50% of the Company's outstanding Common Stock or the combined voting power of the Company's then outstanding voting securities entitled to vote -12- 13 generally or (y) a Controlling Person of the Company, all outstanding options, regardless of the date of grant of such options, shall immediately become exercisable with respect to 100% of the Common Stock subject to such options. 17. No Special Employment Rights. Nothing contained in the Plan or in any option granted under the Plan shall confer upon any option holder any right with respect to the continuation of his or her employment by the Company (or any Parent Corporation or Subsidiary) or interfere in any way with the right of the Company (or any Parent Corporation or Subsidiary), subject to the terms of any separate employment agreement to the contrary, at any time to terminate such employment or to increase or decrease the compensation of the option holder from the rate in existence at the time of the grant of an option. Whether an authorized leave of absence, or absence in military or government service, shall constitute termination or cessation of employment for purposes of this Plan shall be determined by the Board of Directors. 18. Other Employee Benefits. The amount of any compensation deemed to be received by an employee as a result of the exercise of an option or the sale of shares received upon such exercise will not constitute "earnings" with respect to which any other employee benefits of such employee are determined, including without limitation benefits under any pension, profit sharing, life insurance or salary continuation plan. 19. Definition of Subsidiary and Parent Corporation. (a) Subsidiary. The term "Subsidiary" as used in the Plan shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total -13- 14 combined voting power of all classes of stock in one of the other corporations in such chain. For purposes of grants of non-statutory stock options only, the term "Subsidiary" shall also mean any partnerships or limited partnerships for which the Company or any Subsidiary controls 50% or more of the voting power of such partnership or limited partnership, or any corporation in an unbroken chain of Subsidiaries if each of the Subsidiaries other than the last Subsidiary in the unbroken chain either owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations or controls 50% or more of the voting power of any such partnership or limited partnership in such chain. (b) Parent Corporation. The term "Parent Corporation" as used in the Plan shall mean any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company owns stock possessing 50% or more of the combined voting power of all classes of stock in one of the other corporations in such chain. 20. Amendment of the Plan. The Board of Directors may at any time and from time to time modify, amend or terminate the Plan in any respect, except to the extent stockholder approval is required by law. The termination or any modification or amendment of the Plan shall not, without the consent of an optionee, affect his or her rights under an option previously granted to him or her. With the consent of the optionee affected, the Board of Directors may amend outstanding option agreements in a manner not inconsistent with the Plan. The Board of Directors shall have the right to amend or modify the terms and provisions of the Plan and of any outstanding Incentive Stock Options granted under the Plan to the extent necessary to qualify any or all such options for such favorable federal income tax treatment (including deferral of taxation upon exercise) as may be -14- 15 afforded incentive stock options under Section 422 of the Code. 21. Withholding. The Company's obligation to deliver shares upon the exercise of any option granted under the Plan shall be subject to the optionee's satisfaction of all applicable federal, state and local income and employment tax withholding requirements. 22. Effective Date and Duration of the Plan. (a) Effective Date. The Plan shall become effective when adopted by the Board of Directors, but no Incentive Stock Option granted under the Plan shall become exercisable unless and until the Plan shall have been approved by the Company's stockholders. If such stockholder approval is not obtained within twelve months after the date of the Board's adoption of the Plan, any Incentive Stock Options previously granted under the Plan shall terminate and no further Incentive Stock Options shall be granted. Subject to this limitation, options may be granted under the Plan at any time after the effective date and before the date fixed for termination of the Plan. (b) Termination. Unless earlier terminated by the Board of Directors, the Plan shall terminate upon the earlier of (i) the close of business on March 31, 2008 or (ii) the date on which all shares available for issuance under the Plan shall have been issued pursuant to the exercise or cancellation of options granted under the Plan. If the date of termination is determined under (i) above, then options outstanding on such date shall continue to have force and effect in accordance with the provisions of the instruments evidencing such options. Adopted on April 1, 1998 by the Board of Directors. -15- EX-5 3 OPINION OF PAUL, HASTINGS, JANOFSKY & WALKER LLP 1 Exhibit 5 October 6, 1998 i-STAT Corporation 104 Windsor Center Drive East Windsor, NJ 08520 Re: i-STAT Corporation Registration Statement on Form S-8 --------------------------------------------------------- Ladies and Gentlemen: We have acted as counsel for i-STAT Corporation, a Delaware corporation (the "Company"), in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") of a registration statement on Form S-8 (the "Registration Statement"), relating to 2,300,000 shares (the "Shares") of common stock, par value $.15 per share (the "Common Stock") of the Company which may be issued upon the exercise of options granted under the Company's 1998 Stock Option Plan (the "Plan"). You have requested that we furnish our opinion as to the matters set forth below. In this connection we have examined the Registration Statement as filed with the Commission as of the date hereof, the Restated Certificate of Incorporation of the Company and the By-laws of the Company, each as in effect as of the date hereof, and records of corporate proceedings of the Company, the Plan, and such other documents as we have deemed relevant as a basis for this opinion, in each case as made available to us by the Company. We have assumed the legal capacity to sign and the genuineness of all signatures of all persons executing instruments or documents examined or relied upon by us and have assumed the conformity with original documents of all documents examined by us as copies of such documents. 2 Based upon the foregoing, we are of the opinion that the Shares will, upon issuance in accordance with the provisions of the Plan, be validly issued, fully paid and nonassessable. We hereby consent to the reference to this firm contained in Item 5 of the Registration Statement, under the caption "Interests of Named Experts and Counsel" and to the filing of this opinion as Exhibit 5 to the Registration Statement. Very truly yours, /s/ PAUL, HASTINGS, JANOFSKY & WALKER LLP EX-23.1 4 CONSENT OF PRICEWATERHOUSECOOPERS LLP 1 Exhibit 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in this registration statement of i-STAT Corporation on Form S-8 of our report dated January 23, 1998, except for paragraph 1 of Note 15, for which the date is March 4, 1998, on our audits of the consolidated financial statements of i-STAT Corporation as of December 31, 1997 and 1996, and for the years ended December 31, 1997, 1996, and 1995, which report is included in the Company's Annual Report on Form 10-K for the year ended December 31, 1997, which is incorporated by reference in this Form S-8. /s/ PricewaterhouseCoopers LLP Florham Park, New Jersey October 2, 1998 -----END PRIVACY-ENHANCED MESSAGE-----