<PAGE> 1
As filed with the Securities and Exchange Commission on July 24, 1998
Subject to amendment.
Registration No. 33-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
NOVAMETRIX MEDICAL SYSTEMS INC.
(Exact name of registrant as specified in its charter)
DELAWARE 06-0977422
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5 Technology Drive
Wallingford, Connecticut 06492
(Address of principal executive offices)
NOVAMETRIX MEDICAL SYSTEMS INC.
1997 LONG TERM INCENTIVE PLAN
NOVAMETRIX MEDICAL SYSTEMS INC.
EMPLOYEE WARRANTS PLAN
WILLIAM J. LACOURCIERE
President and Chief Executive Officer
Novametrix Medical Systems Inc.
5 Technology Drive
Wallingford, Connecticut 06492
(203) 265-7701
(Name, address and telephone number,
including area code, of agent for service)
Copy to:
JOHN J. BUTLER, Esq.
Haythe & Curley
237 Park Avenue
New York, New York 10017
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the Registration Statement becomes effective.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate offering Amount of
to be registered registered per share* price* registration fee
---------------- ---------- ---------- ------ ----------------
<S> <C> <C> <C> <C>
Common Stock 550,000 shares $7.00 $3,850,000 $1,135.75
($.01 par value)
==============================================================================================
</TABLE>
*Estimated solely for purposes of calculating the registration fee on the basis
of the average of the high and low prices of the Common Stock on July 17, 1998
as reported on the NASDAQ Stock Market.
Page 1 of 28 Pages
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Company hereby states that (i) the documents listed in (a)
through (b) below are incorporated by reference in this Registration Statement
and (ii) all documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended,
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents.
(a) The Company's Annual Report on Form 10-K for the year
ended May 3, 1998.
(b) The description of the Company's Common Stock contained in
the Company's registration statement on Form 10 dated July 24, 1979.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
The Company's counsel in connection with the offering is
Haythe & Curley. Thomas M. Haythe, a partner in the law firm of Haythe & Curley,
is a director of the Company. As of July 1, 1998, Mr. Haythe held 116,540 shares
of the Company's Common Stock and currently exercisable warrants to purchase
8,333 shares of Common Stock of the Company. In addition, other partners in
Haythe & Curley hold an aggregate of 141,562 shares of Common Stock of the
Company.
Item 6. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of
Delaware Law ("Delaware Law") permits a corporation to indemnify its officers
and directors against liability in derivative and non-derivative actions if the
officer or director acted in good faith and in a manner he reasonably believed
to be in the best interests of the corporation and, in a criminal proceeding, if
he had no reasonable cause to believe that his conduct was unlawful. In
addition, Section 145 provides that an officer or director may be indemnified
against liability for action taken while serving another entity at the request
of the corporation so long as his actions were not opposed to the best interests
of the corporation.
Article Seventh of the Company's Certificate of Incorporation
provides that the Company shall indemnify and hold harmless any director or
officer of the Company from and against any and all expenses and liabilities
that may be imposed upon or incurred by him in connection with, or as a result
of, any proceeding in which he may become involved, as a party or otherwise, by
reason of the fact that he is or was such a director or officer of the Company,
whether or not he continues to be such at the time such expenses and liabilities
shall have been imposed or incurred, under certain prescribed circumstances and
subject to the laws of the State of Delaware.
II-1
<PAGE> 3
The Company's Certificate of Incorporation contains a
provision which eliminates the personal liability of a director of the Company
to the Company or to any of its stockholders for monetary damages for a breach
of his fiduciary duty as a director, except in the case where the director
breached his duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or knowingly violated a law, authorized the payment of a
dividend or approved a stock repurchase in violation of Delaware corporate law,
or obtained an improper personal benefit.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The Exhibits required to be filed as part of this Registration
Statement are listed in the attached Index to Exhibits.
Item 9. Undertakings.
The undersigned Registrant hereby undertakes, except as
otherwise specifically provided in the rules of the Securities and Exchange
Commission promulgated under the Securities Act of 1933:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment hereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if this
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Securities and
Exchange Commission by the Registrant pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in this
Registration Statement;
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment 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; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in 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.
II-2
<PAGE> 4
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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 Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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 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 Act and will
be governed by the final adjudication of such issue.
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<PAGE> 5
POWER OF ATTORNEY
The Registrant and each person whose signature appears below
hereby appoints William J. Lacourciere and Jeffery A. Baird as attorneys-in-fact
with full power of substitution, severally, to execute in the name and on behalf
of the Registrant and each such person, individually and in each capacity stated
below, one or more post-effective amendments to this Registration Statement as
the attorney-in-fact acting in the premises deems appropriate and to file any
such amendment to this Registration Statement with the Securities and Exchange
Commission.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
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 Wallingford and State of Connecticut on the 24th
day of July, 1998.
NOVAMETRIX MEDICAL SYSTEMS INC.
By /s/ William J. Lacourciere
--------------------------------------
William J. Lacourciere
Chairman of the Board, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ William J. Lacourciere Chairman of the Board, July 24, 1998
William J. Lacourciere President, Chief
Executive Officer
and Director
/s/ Jeffery A. Baird Chief Financial Officer and July 24, 1998
Jeffery A. Baird Principal Accounting Officer
/s/Paul A. Cote Director July 24, 1998
Paul A. Cote
/s/Thomas M. Haythe Director July 24, 1998
Thomas M. Haythe
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<PAGE> 6
Signature Title Date
- --------- ----- ----
/s/ John P. Mahoney Director July 24, 1998
John P. Mahoney
/s/ Photios T. Paulson Director July 24, 1998
Photios T. Paulson
/s/ Steven J. Shulman Director July 24, 1998
Steven J. Shulman
/s/ Vartan Ghugasian Director July 24, 1998
Vartan Ghugasian
II-5
<PAGE> 7
CONSENT OF COUNSEL
The consent of Haythe & Curley is contained in their opinion
filed as Exhibit 5 to this Registration Statement.
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<PAGE> 8
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the
Registration Statement (Form S-8) pertaining to the Novametrix Medical Systems
Inc. 1997 Long Term Incentive Plan and the Novametrix Medical Systems Inc.
Employee Warrants Plan of our report dated June 24, 1998, with respect to the
consolidated financial statements and schedules of Novametrix Medical Systems
Inc. included in its Annual Report (Form 10-K) for the year ended May 3, 1998,
filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Hartford, Connecticut
July 21, 1998
II-7
<PAGE> 9
INDEX TO EXHIBITS
Number Description of Exhibit Page
- ------ ---------------------- ----
4(i) - Novametrix Medical Systems Inc. 1997 Long Term E-1
Incentive Plan
4(ii) - Form of Warrant Certificate for Novametrix Medical E-14
Systems Inc. Employee Warrants Plan
5 - Opinion of Haythe & Curley E-19
23(i) - Consent of Ernst & Young LLP, Independent Auditors (see --
"Consent of Independent Auditors" in the Registration
Statement)
23(ii) - Consent of Haythe & Curley (contained in Exhibit 5) --
24 - Power of Attorney (see "Power of Attorney" in the --
Registration Statement)
II-8
<PAGE> 1
EXHIBIT 4(i)
NOVAMETRIX MEDICAL SYSTEMS INC.
1997 LONG TERM INCENTIVE PLAN
SECTION 1. Purpose. The purposes of this Novametrix Medical
Systems Inc. 1997 Long Term Incentive Plan (the "Plan") are to encourage
selected employees, officers, directors and consultants of, and other
individuals providing services to, Novametrix Medical Systems Inc. (together
with any successor thereto, the "Company") and its Affiliates (as defined below)
to acquire a proprietary interest in the growth and performance of the Company,
to generate an increased incentive to contribute to the Company's future success
and prosperity thus enhancing the value of the Company for the benefit of its
shareholders, and to enhance the ability of the Company and its Affiliates to
attract and retain exceptionally qualified individuals upon whom, in large
measure, the sustained progress, growth and profitability of the Company depend.
SECTION 2. Definitions. As used in the Plan, the following
terms shall have the meanings set forth below:
"Affiliate" shall mean (i) any entity that, directly or
through one or more intermediaries, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest, as determined by
the Committee.
"Award" shall mean any Option, Stock Appreciation Right,
Restricted Security, Performance Award, or Other Stock-Based Award granted under
the Plan.
"Award Agreement" shall mean any written agreement, contract
or other instrument or document evidencing any Award granted under the Plan.
"Board" shall mean the Board of Directors of the Company.
"Cause", as used in connection with the termination of a
Participant's employment, shall mean (i) with respect to any Participant
employed under a written employment agreement with the Company or an Affiliate
of the Company which agreement includes a definition of "cause," "cause" as
defined in such agreement or, if such agreement contains no such definition, a
material breach by the Participant of such agreement, or (ii) with respect to
any other Participant, the failure to perform adequately in carrying out such
Participant's employment responsibilities, including any directives from the
Board, or engaging in such behavior in his personal or business life as to lead
the Committee in its reasonable judgment to determine that it is in the best
interests of the Company to terminate his employment.
"Common Stock" shall mean the common stock of the Company,
$.01 par value.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated thereunder.
"Committee" shall mean the Compensation Committee or any other
committee of the Board designated by the Board to administer the Plan and
composed of not less than three nonemployee directors.
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<PAGE> 2
"Common Shares" shall mean any or all, as applicable, of the
Common Stock and such other securities or property as may become the subject of
Awards, or become subject to Awards, pursuant to an adjustment made under
Section 4(b) of the Plan and any other securities of the Company or any
Affiliate or any successor that may be so designated by the Committee.
"Employee" shall mean any employee of the Company or of any
Affiliate.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Fair Market Value" shall mean (A) with respect to any
property other than the Common Shares, the fair market value of such property
determined by such methods or procedures as shall be established from time to
time by the Committee; and (B) with respect to the Common Shares, the last sale
price regular way on the date of reference, or, in case no sale takes place on
such date, the average of the high bid and low asked prices, in either case on
the principal national securities exchange on which the Common Shares are listed
or admitted to trading, or if the Common Shares are not listed or admitted to
trading on any national securities exchange, the last sale price reported on the
National Market System of the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") on such date, or the average of the
closing high bid and low asked prices in the over-the-counter market reported on
NASDAQ on such date, whichever is applicable, or if there are no such prices
reported on NASDAQ on such date, as furnished to the Committee by any New York
Stock Exchange member selected from time to time by the Committee for such
purpose. If there is no bid or asked price reported on any such date, the Fair
Market Value shall be determined by the Committee in accordance with the
regulations promulgated under Section 2031 of the Code, or by any other
appropriate method selected by the Committee.
"Good Reason", as used in connection with the termination of a
Participant's employment, shall mean (i) with respect to any Participant
employed under a written employment agreement with the Company or an Affiliate
of the Company, "good reason" as defined in such written agreement or, if such
agreement contains no such definition, a material breach by the Company of such
agreement, or (ii) with respect to any other Participant, a failure by the
Company to pay such Participant any amount otherwise vested and due and a
continuation of such failure for 30 business days following notice to the
Company thereof.
"Incentive Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is intended to meet the requirements of Section
422 of the Code or any successor provision thereto.
"Non-Qualified Stock Option" shall mean an option granted
under Section 6(a) of the Plan that is not intended to be an Incentive Stock
Option. Any stock option granted by the Committee which is not designated an
Incentive Stock Option shall be deemed a Non-Qualified Stock Option.
"Option" shall mean an Incentive Stock Option or a
Non-Qualified Stock Option.
"Other Stock-Based Award" shall mean any right granted under
Section 6(e) of the Plan.
"Participant" shall mean any individual granted an Award under
the Plan.
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<PAGE> 3
"Performance Award" shall mean any right granted under Section
6(d) of the Plan.
"Person" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, or
government or political subdivision thereof.
"Released Securities" shall mean securities that were
Restricted Securities but with respect to which all applicable restrictions have
expired, lapsed or been waived in accordance with the terms of the Plan or the
applicable Award Agreement.
"Restricted Securities" shall mean any Common Shares granted
under Section 6(c) of the Plan, any right granted under Section 6(c) of the Plan
that is denominated in Common Shares or any other Award under which issued and
outstanding Common Shares are held subject to certain restrictions.
"Rule 16a-1" and "Rule 16b-3" shall mean, respectively, Rule
16a-1 and Rule 16b-3 promulgated by the Securities and Exchange Commission under
the Exchange Act, or any successor rule or regulation thereto as in effect from
time to time.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Stock Appreciation Right" shall mean any right granted under
Section 6(b) of the Plan.
SECTION 3. Administration. The Plan shall be administered by
the Committee. Subject to the terms of the Plan and applicable law, and in
addition to other express powers and authorizations conferred on the Committee
by the Plan, the Committee shall have full power and authority to: (i) designate
Participants; (ii) determine the type or types of Awards to be granted to an
eligible Employee or other individual under the Plan; (iii) determine the number
and classification of Common Shares to be covered by (or with respect to which
payments, rights or other matters are to be calculated in connection with)
Awards; (iv) determine the terms and conditions of any Award; (v) determine
whether, to what extent, and under what circumstances Awards may be settled or
exercised in cash, Common Shares, other securities, other Awards or other
property, or canceled, forfeited or suspended, and the method or methods by
which Awards may be settled, exercised, canceled, forfeited or suspended; (vi)
determine requirements for the vesting of Awards or performance criteria to be
achieved in order for Awards to vest; (vii) determine whether, to what extent
and under what circumstances cash, Common Shares, other securities, other
Awards, other property and other amounts payable with respect to an Award under
the Plan shall be deferred either automatically or at the election of the holder
thereof or of the Committee; (viii) interpret and administer the Plan and any
instrument or agreement relating to, or Award made under, the Plan; (ix)
establish, amend, suspend or waive such rules and regulations and appoint such
agents as it shall deem appropriate for the proper administration of the Plan;
and (x) make any other determination and take any other action that the
Committee deems necessary or desirable for the administration of the Plan.
Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect to the
Plan or any Award shall be within the sole discretion of the Committee, may be
made at any time and shall be final, conclusive and binding upon all Persons,
including the Company, any Affiliate, any Participant, any holder or beneficiary
of any Award, any shareholder and any Employee. Notwithstanding the foregoing,
the maximum number of Awards which may be granted to any one Participant under
this Plan in any one-year period shall not exceed 50,000 Common Shares, subject
to the adjustments provided in Section 4(b) hereof and no Awards under this Plan
shall be granted after December 31, 2006.
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<PAGE> 4
SECTION 4. Common Shares Available for Awards.
(a) Common Shares Available. Subject to adjustment as provided
in Section 4(b):
(i) Calculation of Number of Common Shares Available.
The number of Common Shares available for granting Awards
under the Plan shall be 500,000, any or all of which may be or
may be based on Common Stock, any other security which becomes
the subject of Awards, or any combination thereof. Initially
500,000 shares of Common Stock shall be reserved for Awards
hereunder. Further, if, after the effective date of the Plan,
any Common Shares covered by an Award granted under the Plan
or to which such an Award relates, are forfeited, or if an
Award otherwise terminates or is canceled without the delivery
of Shares or of other consideration, then the Common Shares
covered by such Award or to which such Award relates, or the
number of Common Shares otherwise counted against the
aggregate number of Common Shares available under the Plan
with respect to such Award, to the extent of any such
forfeiture, termination or cancellation, shall again be, or
shall become, available for granting Awards under the Plan.
(ii) Accounting for Awards. For purposes of this
Section 4,
(A) if an Award is denominated in or based
upon Common Shares, the number of Common Shares
covered by such Award or to which such Award relates
shall be counted on the date of grant of such Award
against the aggregate number of Common Shares
available for granting Awards under the Plan and
against the maximum number of Awards available to any
Participant; and
(B) Awards not denominated in Common Shares
may be counted against the aggregate number of Common
Shares available for granting Awards under the Plan
and against the maximum number of Awards available to
any participant in such amount and at such time as
the Committee shall determine under procedures
adopted by the Committee consistent with the purposes
of the Plan;
provided, however, that Awards that operate in tandem with
(whether granted simultaneously with or at a different
time from), or that are substituted for, other Awards may
be counted or not counted under procedures adopted by the
Committee in order to avoid double counting. Any Common
Shares that are delivered by the Company, and any Awards
that are granted by, or become obligations of, the
Company, through the assumption by the Company or an
Affiliate of, or in substitution for, outstanding awards
previously granted by an acquired company shall, in the
case of Awards granted to Participants who are officers or
directors of the Company for purposes of Section 16 of the
Exchange Act, be counted against the Common Shares
available for granting Awards under the Plan.
(iii) Sources of Common Shares Deliverable Under
Awards. Any Common Shares delivered pursuant to an Award
may consist, in whole or in part, of authorized and
unissued Common Shares or of treasury Common Shares.
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<PAGE> 5
(b) Adjustments. In the event that the Committee shall
determine that any dividend or other distribution (whether in the form of cash,
Common Shares, other securities or other property), recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-up,
spin-off, combination, repurchase or exchange of Common Shares or other
securities of the Company, issuance of warrants or other rights to purchase
Common Shares or other securities of the Company, or other similar corporate
transaction or event affects the Common Shares such that an adjustment is
determined by the Committee to be appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan, then the Committee shall, in such manner as it may deem
equitable, adjust any or all of (i) the number and kind of Common Shares (or
other securities or property) which thereafter may be made the subject of
Awards, (ii) the number and kind of Common Shares (or other securities or
property) subject to outstanding Awards, and (iii) the grant or exercise price
with respect to any Award or, if deemed appropriate, make provision for a cash
payment to the holder of an outstanding Award; provided, however, that the
number of Common Shares subject to any Award denominated in Common Shares shall
always be a whole number.
In connection with any merger or consolidation in which the
Company is not the surviving corporation and which results in the holders of the
outstanding voting securities of the Company (determined immediately prior to
such merger or consolidation) owning less than a majority of the outstanding
voting securities of the surviving corporation (determined immediately following
such merger or consolidation), or any sale or transfer by the Company of all or
substantially all its assets or any tender offer or exchange offer for or the
acquisition, directly or indirectly, by any person or group of all or a majority
of the then outstanding voting securities of the Company, all outstanding
Options under the Plan shall become exercisable in full, notwithstanding any
other provision of the Plan or of any outstanding Options granted thereunder, on
and after (i) the fifteenth day prior to the effective date of such merger,
consolidation, sale, transfer or acquisition or (ii) the date of commencement of
such tender offer or exchange offer, as the case may be. The provisions of the
foregoing sentence shall apply to any outstanding Options which are Incentive
Stock Options to the extent permitted by Section 422(d) of the Code and such
outstanding Options in excess thereof shall, immediately upon the occurrence of
the event described in clause (i) or (ii) of the foregoing sentence, be treated
for all purposes of the Plan as Non-Qualified Stock Options and shall be
immediately exercisable as such as provided in the foregoing sentence.
SECTION 5. Eligibility. Any Employee, including any officer or
employee-director of the Company or of any Affiliate, and any consultant of, or
other individual providing services to, the Company or any Affiliate shall be
eligible to be designated a Participant. A non-employee director shall be
eligible to receive Non-Qualified Stock Options under the Plan.
SECTION 6. Awards.
(a) Options. The Committee is hereby authorized to grant to
eligible individuals options to purchase Common Shares (each, an "Option") which
shall contain the following terms and conditions and with such additional terms
and conditions, in either case not inconsistent with the provisions of the Plan,
as the Committee shall determine:
(i) Exercise Price. The purchase price per Common
Share purchasable under an Option shall be determined by the
Committee; provided, however, that such purchase price shall
not be less than one hundred percent (100%) of the Fair Market
Value of a Common Share on the date of grant of such Option,
or such other price as required under Subsection 6(a)(iv)
hereof.
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<PAGE> 6
(ii) Time and Method of Exercise. Subject to the
terms of Section 6(a)(iii), the Committee shall determine the
time or times at which an Option may be exercised in whole or
in part, and the method or methods by which, and the form or
forms (including, without limitation, cash, Common Shares,
outstanding Awards, or other property, or any combination
thereof, having a Fair Market Value on the exercise date equal
to the relevant exercise price) in which, payment of the
exercise price with respect thereto may be made or deemed to
have been made.
(iii) Exercisability Upon Death, Retirement and
Termination of Employment. Subject to the condition that no
Option may be exercised in whole or in part after the
expiration of the Option period specified in the applicable
Award Agreement:
(A) Subject to the terms of paragraph (D)
below, upon the death of a Participant while employed
or within 3 months of retirement or disability as
defined in paragraph (B) below, the Person or Persons
to whom such Participant's rights with respect to any
Option held by such Participant are transferred by
will or the laws of descent and distribution may,
prior to the expiration of the earlier of: (1) the
outside exercise date determined by the Committee at
the time of granting the Option, or (2) nine months
after such Participant's death, purchase any or all
of the Common Shares with respect to which such
Participant was entitled to exercise such Option
immediately prior to such Participant's death, and
any Options not so exercisable will lapse on the date
of such Participant's death;
(B) Subject to the terms of paragraph (D)
below, upon termination of a Participant's employment
with the Company (x) as a result of retirement
pursuant to a retirement plan of the Company or an
Affiliate or disability (as determined by the
Committee) of such Participant, (y) by the Company
other than for Cause, or (z) by the Participant with
Good Reason, such Participant may, prior to the
expiration of the earlier of: (1) the outside
exercise date determined by the Committee at the time
of granting the Option, or (2) three months after the
date of such termination, purchase any or all of the
Common Shares with respect to which such Participant
was entitled to exercise any Options immediately
prior to such termination, and any Options not so
exercisable will lapse on such date of termination;
(C) Subject to the terms of paragraph (D)
below, upon termination of a Participant's employment
with the Company under any circumstances not
described in paragraphs (A) or (B) above, such
Participant's Options shall be canceled to the extent
not theretofore exercised;
(D) Upon (i) the death of the Participant,
or (ii) termination of the Participant's employment
with the Company (x) by the Company other than for
Cause (y) by the Participant with Good Reason or (z)
as a result of retirement or disability as defined in
paragraph (B) above, the Company shall have the right
to cancel all of the Options such Participant was
entitled to exercise at the time of such death or
termination (subject to the terms of paragraphs (A)
or (B) above) for a payment in cash equal to the
excess, if any, of the Fair Market Value of one
Common Share on the date of death or
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<PAGE> 7
termination over the exercise price of such Option
for one Common Share times the number of Common
Shares subject to the Option and exercisable at the
time of such death or termination; and
(E) Upon expiration of the respective
periods set forth in each of paragraphs (A) through
(C) above, the Options of a Participant who has died
or whose employment has been terminated shall be
canceled to the extent not theretofore canceled or
exercised.
(F) For purposes of paragraphs (A) through
(D) above, the period of service of an individual as
a director or consultant of the Company or an
Affiliate shall be deemed the period of employment.
(iv) Incentive Stock Options. The following
provisions shall apply only to Incentive Stock Options granted
under the Plan:
(A) No Incentive Stock Option shall be
granted to any eligible Employee who, at the time
such Option is granted, owns securities possessing
more than ten percent (10%) of the total combined
voting power of all classes of securities of the
Company or of any Affiliate, except that such an
Option may be granted to such an Employee if at the
time the Option is granted the option price is at
least one hundred ten percent (110%) of the Fair
Market Value of the Common Shares (determined in
accordance with Section 2) subject to the Option, and
the Option by its terms is not exercisable after the
expiration of five (5) years from the date the Option
is granted; and
(B) To the extent that the aggregate Fair
Market Value of the Common Shares with respect to
which Incentive Stock Options (without regard to this
subsection) are exercisable for the first time by any
individual during any calendar year (under all plans
of the Company and its Affiliates) exceeds $100,000,
such Options shall be treated as Non-Qualified Stock
Options. This subsection shall be applied by taking
Options into account in the order in which they were
granted. If some but not all Options granted on any
one day are subject to this subsection, then such
Options shall be apportioned between Incentive Stock
Option and Non-Qualified Stock Option treatment in
such manner as the Committee shall determine. For
purposes of this subsection, the Fair Market Value of
any Common Shares shall be determined, in accordance
with Section 2, as of the date the Option with
respect to such Common Shares is granted.
(v) Other Terms and Conditions of Options.
Notwithstanding any provision contained in the Plan to the
contrary, during any period when any member of the Committee
shall not be a "nonemployee director" as defined in Rule
16b-3, then, the terms and conditions of Options granted under
the Plan to any director or officer, as defined in Rule 16a-1,
of the Company during such period, unless other terms and
conditions are approved in advance by the Board, shall be as
follows:
(A) The price at which each Common Share
subject to an option may be purchased shall, subject
to any adjustments which may be made pursuant to
Section 4, in no event be less than the Fair Market
Value
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of a Common Share on the date of grant, and provided
further that in the event the option is intended to
be an Incentive Stock Option and the optionee owns on
the date of grant securities possessing more than ten
percent (10%) of the total combined voting power of
all classes of securities of the Company or of any
Affiliate, the price per share shall not be less than
one hundred ten percent (110%) of the Fair Market
Value per Common Share on the date of grant.
(B) The Option may be exercised to purchase
Common Shares covered by the Option not sooner than
six (6) months following the date of grant. The
Option shall terminate and no Common Shares may be
purchased thereunder more than ten (10) years after
the date of grant, provided that if the Option is
intended to be an Incentive Stock Option and the
Optionee owns on the date of grant securities
possessing more than ten percent (10%) of the total
combined voting power of all classes of securities of
the Company or of any Affiliate, the Option shall
terminate and no Common Shares may be purchased
thereunder more than five (5) years after the date of
grant.
(b) Stock Appreciation Rights. The Committee is hereby
authorized to grant to eligible Employees "Stock Appreciation Rights." Each
Stock Appreciation Right shall consist of a right to receive the excess of (i)
the Fair Market Value of one Common Share on the date of exercise or, if the
Committee shall so determine in the case of any such right other than one
related to any Incentive Stock Option, at any time during a specified period
before or after the date of exercise over (ii) the grant price of the right as
specified by the Committee, which shall not be less than one hundred percent
(100%) of the Fair Market Value of one Common Share on the date of grant of the
Stock Appreciation Right (or, if the Committee so determines, in the case of any
Stock Appreciation Right retroactively granted in tandem with or in substitution
for another Award, on the date of grant of such other Award). Subject to the
terms of the Plan and any applicable Award Agreement, the grant price, term,
methods of exercise, methods of settlement, and any other terms and conditions
of any Stock Appreciation Right granted under the Plan shall be as determined by
the Committee. The Committee may impose such conditions or restrictions on the
exercise of any Stock Appreciation Right as it may deem appropriate.
(c) Restricted Securities.
(i) Issuance. The Committee is hereby authorized to
grant to eligible Employees "Restricted Securities" which
shall consist of the right to receive, by purchase or
otherwise, Common Shares which are subject to such
restrictions as the Committee may impose (including, without
limitation, any limitation on the right to vote such Common
Shares or the right to receive any dividend or other right or
property), which restrictions may lapse separately or in
combination at such time or times, in such installments or
otherwise, as the Committee may deem appropriate.
(ii) Registration. Restricted Securities granted
under the Plan may be evidenced in such manner as the
Committee may deem appropriate, including, without limitation,
book-entry registration or issuance of a stock certificate or
certificates. In the event any stock certificate is issued in
respect of Restricted Securities granted under the Plan, such
certificate shall be registered in the name of the Participant
and shall bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Restricted
Securities.
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(iii) Forfeiture. Except as otherwise determined by
the Committee, upon termination of a Participant's employment
for any reason during the applicable restriction period, all
of such Participant's Restricted Securities which had not
become Released Securities by the date of termination of
employment shall be forfeited and reacquired by the Company;
provided, however, that the Committee may, when it finds that
a waiver would be in the best interests of the Company, waive
in whole or in part any or all remaining restrictions with
respect to such Participant's Restricted Securities.
Unrestricted Common Shares, evidenced in such manner as the
Committee shall deem appropriate, shall be issued to the
holder of Restricted Securities promptly after such Restricted
Securities become Released Securities.
(d) Performance Awards. The Committee is hereby authorized to
grant to eligible Employees "Performance Awards." Each Performance Award shall
consist of a right, (i) denominated or payable in cash, Common Shares, other
securities or other property (including, without limitation, Restricted
Securities), and (ii) which shall confer on the holder thereof rights valued as
determined by the Committee and payable to, or exercisable by, the holder of the
Performance Award, in whole or in part, upon the achievement of such performance
goals during such performance periods as the Committee shall establish. Subject
to the terms of the Plan and any applicable Award Agreement, the performance
goals to be achieved during any performance period, the length of any
performance period, the amount of any Performance Award granted, the termination
of a Participant's employment and the amount of any payment or transfer to be
made pursuant to any Performance Award shall be determined by the Committee and
by the other terms and conditions of any Performance Award. The Committee shall
issue performance goals prior to the commencement of the performance period to
which such performance goals pertain.
(e) Other Stock-Based Awards. The Committee is hereby
authorized to grant to eligible Employees "Other Stock-Based Awards." Each Other
Stock-Based Award shall consist of a right (i) which is other than an Award or
right described in Section 6(a), (b), (c) or (d) above and (ii) which is
denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, Common Shares (including, without limitation,
securities convertible into Common Shares) as are deemed by the Committee to be
consistent with the purposes of the Plan; provided, however, that such right
shall comply, to the extent deemed desirable by the Committee, with Rule 16b-3
and applicable law. Subject to the terms of the Plan and any applicable Award
Agreement, the Committee shall determine the terms and conditions of Other
Stock-Based Awards. Common Shares or other securities delivered pursuant to a
purchase right granted under this Section 6(e) shall be purchased for such
consideration, which may be paid by such method or methods and in such form or
forms, including, without limitation, cash, Common Shares, other securities,
other Awards, other property, or any combination thereof, as the Committee shall
determine.
(f) General.
(i) No Cash Consideration for Awards. Awards may be
granted for no cash consideration or for such minimal cash
consideration as may be required by applicable law.
(ii) Awards May Be Granted Separately or Together.
Awards may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in
substitution for any other Award, except that in no event
shall an Incentive Stock Option be granted together with a
Non-Qualified Stock Option in such a manner that the exercise
of one Option affects the right to
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<PAGE> 10
exercise the other. Awards granted in addition to or in tandem
with other Awards may be granted either at the same time as or
at a different time from the grant of such other awards.
(iii) Forms of Payment Under Awards. Subject to the
terms of the Plan and of any applicable Award Agreement,
payments or transfers to be made by the Company or an
Affiliate upon the grant, exercise or payment of an Award may
be made in such form or forms as the Committee shall
determine, including, without limitation, cash, Common Shares,
other securities, other Awards, or other property, or any
combination thereof, and may be made in a single payment or
transfer, in installments, or on a deferred basis, in each
case in accordance with rules and procedures established by
the Committee. Such rules and procedures may include, without
limitation, provisions for the payment or crediting of
reasonable interest on installment or deferred payments. In
accordance with the above, the Committee may elect (i) to pay
a Participant (or such Participant's permitted transferee)
upon the exercise of an Option in whole or in part, in lieu of
the exercise thereof and the delivery of Common Shares
thereunder, an amount of cash equal to the excess, if any, of
the Fair Market Value of one Common Share on the date of such
exercise over the exercise price of such Option for one Common
Share times the number of Common Shares subject to the Option
or portion thereof so exercised or (ii) to settle other stock
denominated Awards in cash.
(iv) Limits on Transfer of Awards.
(A) No award (other than Released
Securities), and no right under any such Award, may
be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by a Participant
otherwise than by will or by the laws of descent and
distribution (or, in the case of Restricted
Securities, to the Company) and any such purported
assignment, alienation, pledge, attachment, sale or
other transfer or encumbrance shall be void and
unenforceable against the Company or any Affiliate.
(B) Each award, and each right under any
Award, shall be exercisable during the Participant's
lifetime only by the Participant or, if permissible
under applicable law, by the Participant's guardian
or legal representative.
(v) Terms of Awards. The term of each Award shall be
for such period as may be determined by the Committee;
provided, however, that in no event shall the term of any
Option exceed a period of ten years from the date of its
grant.
(vi) Rule 16b-3 Six-Month Limitations. To the extent
required in order to maintain the exemption provided under
Rule 16b-3 only, any equity security offered pursuant to the
Plan must be held for at least six months after the date of
grant, and with respect to any derivative security issued
pursuant to the Plan, at least six months must elapse from the
date of acquisition of such derivative security to the date of
disposition of the derivative security (other than upon
exercise or conversion) or its underlying equity security.
Terms used in the preceding sentence shall, for the purposes
of such sentence only, have the
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<PAGE> 11
meanings, if any, assigned or attributed to them under Rule
16b-3.
(vii) Common Share Certificates. All certificates for
Common Shares delivered under the Plan pursuant to any Award
or the exercise thereof shall be subject to such stop transfer
orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations, and other
requirements of the Securities and Exchange Commission, any
stock exchange upon which such Common Shares are then listed,
and any applicable Federal or state securities laws, and the
Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such
restrictions.
(viii) Delivery of Common Shares or Other Securities
and Payment by Participant of Consideration. No Common Shares
or other securities shall be delivered pursuant to any Award
until payment in full of any amount required to be paid
pursuant to the Plan or the applicable Award Agreement is
received by the Company. Such payment may be made by such
method or methods and in such form or forms as the Committee
shall determine, including, without limitation, cash, Common
Shares, other securities, other Awards or other property, or
any combination thereof; provided that the combined value, as
determined by the Committee, of all cash and cash equivalents
and the Fair Market Value of any such Common Shares or other
property so tendered to the Company, as of the date of such
tender, is at least equal to the full amount required to be
paid pursuant to the Plan or the applicable Award Agreement to
the Company.
SECTION 7. Amendments; Adjustments and Termination. Except to
the extent prohibited by applicable law and unless otherwise expressly provided
in an Award Agreement or in the Plan:
(a) Amendments to the Plan. The Board may amend, alter,
suspend, discontinue, or terminate the Plan without the consent of any
shareholder, Participant, other holder or beneficiary of an Award, or other
Person; provided, however, that, subject to the Company's rights to adjust
Awards under Sections 7(c) and (d), any amendment, alteration, suspension,
discontinuation, or termination that would impair the rights of any Participant,
or any other holder or beneficiary of any Award theretofore granted, shall not
to that extent be effective without the consent of such Participant, other
holder or beneficiary of an Award, as the case may be; and provided further,
however, that notwithstanding any other provision of the Plan or any Award
Agreement, without the approval of the shareholders of the Company no such
amendment, alteration, suspension, discontinuation, or termination shall be made
that would:
(i) increase the total number of Common Shares
available for Awards under the Plan, except as provided in
Section 4 hereof; or
(ii) otherwise cause the Plan to cease to comply with
any tax or regulatory requirement, including for these
purposes any approval or other requirement which is or would
be a prerequisite for exemptive relief from Section 16(b) of
the Exchange Act.
(b) Amendments to Awards. The Committee may waive any
conditions or rights under, amend any terms of, or alter, suspend, discontinue,
cancel or terminate, any Award theretofore granted, prospectively or
retroactively; provided, however, that, subject to the Company's rights to
adjust Awards under Sections 7(c) and (d), any amendment, alteration,
suspension,
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discontinuation, cancellation or termination that would impair the rights of any
Participant or holder or beneficiary of any Award theretofore granted, shall not
to that extent be effective without the consent of such Participant or holder or
beneficiary of an Award, as the case may be.
(c) Adjustment of Awards Upon Certain Acquisitions. In the
event the Company or any Affiliate shall assume outstanding employee awards or
the right or obligation to make future such awards in connection with the
acquisition of another business or another corporation or business entity, the
Committee may make such adjustments, not inconsistent with the terms of the
Plan, in the terms of Awards as it shall deem appropriate in order to achieve
reasonable comparability or other equitable relationship between the assumed
awards and the Awards granted under the Plan as so adjusted.
(d) Adjustments of Awards Upon the Occurrence of Certain
Unusual or Nonrecurring Events. The Committee is hereby authorized to make
adjustments in the terms and conditions of, and the criteria included in, Awards
in recognition of unusual or non-recurring events (including, without
limitation, the events described in Section 4(b) hereof) affecting the Company,
any Affiliate, or the financial statements of the Company or any Affiliate, or
of changes in applicable laws, regulations, or accounting principles, whenever
the Committee determines that such adjustments are appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan.
SECTION 8. General Provisions.
(a) No Right to Awards. No Employee or other Person shall have
any claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of Employees, or holders or beneficiaries of Awards
under the Plan. The terms and conditions of Awards need not be the same with
respect to each recipient.
(b) Delegation. Subject to the terms of the Plan and
applicable law, the Committee may delegate to one or more officers or managers
of the Company or any Affiliate, or to a committee of such officers or managers,
the authority, subject to such terms and limitations as the Committee shall
determine, to grant Awards to, or to cancel, modify, waive rights with respect
to, alter, discontinue, suspend, or terminate Awards; provided, however, that,
no such delegation shall be permitted with respect to Awards held by Employees
who are officers or directors of the Company for purposes of Section 16 of the
Exchange Act, or any successor section thereto or who are otherwise subject to
such Section.
(c) Correction of Defects, Omissions, and Inconsistencies. The
Committee may correct any defect, supply any omission, or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry the Plan into effect.
(d) Withholding. The Company or any Affiliate shall be
authorized to withhold from any Award granted, from any payment due or transfer
made under any Award or under the Plan or from any compensation or other amount
owing to a Participant the amount (in cash, Common Shares, other securities,
other Awards, or other property) of withholding taxes due in respect of an
Award, its exercise, or any payment or transfer under such Award or under the
Plan and to take such other action as may be necessary in the opinion of the
Company or Affiliate to satisfy all obligations for the payment of such taxes.
(e) No Limit on Other Compensation Arrangements. Nothing
contained in the Plan shall prevent the Company or any Affiliate from adopting
or continuing in effect other or
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<PAGE> 13
additional compensation arrangements, and such arrangements may be either
generally applicable or applicable only in specific cases.
(f) No Right to Employment. The grant of an Award shall not be
construed as giving a Participant the right to be retained in the employ of the
Company or any Affiliate. Further, the Company or an Affiliate may at any time
dismiss a Participant from employment, free from any liability, or any claim
under the Plan, unless otherwise expressly provided in the Plan or in any Award
Agreement.
(g) Governing Law. The validity, construction, and effect of
the Plan and any rules and regulations relating to the Plan shall be determined
in accordance with the laws of the State of Delaware and applicable Federal law.
(h) Severability. If any provision of the Plan or any Award is
or becomes or is deemed to be invalid, illegal or unenforceable in any
jurisdiction or as to any Person or Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan or
the Award, such provision shall be stricken as to such jurisdiction, Person or
Award and the remainder of the Plan and any such Award shall remain in full
force and effect.
(i) No Trust or Fund Created. Neither the Plan nor any Award
shall create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company or any Affiliate and a Participant or
any other Person. To the extent that any Person acquires a right to receive
payments from the Company or any Affiliate pursuant to an Award, such right
shall be no greater than the right of any unsecured general creditor of the
Company or any Affiliate.
(j) No Fractional Common Shares. No fractional Common Shares
shall be issued or delivered pursuant to the Plan or any Award, and the
Committee shall determine whether cash, other securities, or other property
shall be paid or transferred in lieu of any fractional Common Shares or whether
such fractional Common Shares or any rights thereto shall be canceled,
terminated, or otherwise eliminated.
(k) Headings. Headings are given to the Sections and
subsections of the Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of the Plan or any provision thereof.
SECTION 9. Adoption, Approval and Effective Date of the Plan.
The Plan shall be considered adopted and shall become effective on the date the
Plan is approved by the Board; provided, however, that the Plan and any Awards
granted under the Plan shall be void, if the shareholders of the Company shall
not have approved the adoption of the Plan within twelve (12) months after the
effective date, by a majority of votes cast thereon at a meeting of shareholders
duly called and held for such purpose.
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EXHIBIT 4(ii)
NOVAMETRIX MEDICAL SYSTEMS INC.
Form of Employee Warrant Certificate
Date of Grant:
Name of Employee:
Number of Shares:
Price Per Share:
This is to certify that, effective on the date of grant
specified above, the Board of Directors (the "Board") of Novametrix Medical
Systems Inc. (the "Company") has granted to the above-named employee (the
"Employee") a warrant to purchase from the Company, for the price per share set
forth above, the number of shares of Common Stock, $.01 par value (the "Stock"),
of the Company set forth above.
The terms and conditions of the warrant granted hereby are as
follows:
1. The price at which each share of Stock subject to this
warrant may be purchased shall be the price set forth above, subject to any
adjustments which may be made pursuant to Section 9 hereof.
2. Subject to the terms and conditions set forth herein, this
warrant shall become exercisable to purchase the shares of Stock covered by this
warrant only in accordance with the following schedule:
Cumulative Percentage
of Aggregate Number of
Shares of Stock Covered
by Warrant which May Be
Exercise Period Purchased
- --------------- -----------------------
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<PAGE> 2
less, in the case of each exercise period, the number of shares of Stock, if
any, previously purchased hereunder. This warrant shall terminate and no shares
of Stock may be purchased hereunder more than ten years after the date of grant.
3. Except as provided in Section 7 hereof, this warrant may
not be exercised unless the Employee is in the employ of the Company or one of
its parent or subsidiary corporations (within the meaning of Sections 425(e) and
(f) of the Code, and referred to herein as "Parent" and "Subsidiary",
respectively) at the time of such exercise and shall have been such an employee
continuously since the date of grant of this warrant. For purposes of this
warrant, service as a director, officer or consultant of the Company or any
Parent or Subsidiary shall be considered employment.
4. Subject to the terms and conditions set forth herein, the
Employee may exercise this warrant at any time as to all or any of the shares of
Stock then purchasable in accordance with Section 2 hereof by delivering to the
Company written notice specifying:
(i) the number of whole shares of Stock to be purchased
together with payment in full of the aggregate warrant price of such
shares, provided that this warrant may not be exercised for less than
ten (10) shares of Stock or the number of shares of Stock remaining
subject to warrant, whichever is smaller;
(ii) the name or names in which the stock certificate or
certificates are to be registered;
(iii) the address to which dividends, notices, reports, etc.
are to be sent; and
(iv) the Employee's social security number.
Only one Stock certificate will be issued unless the Employee otherwise requests
in writing. Payment shall be in cash, or by certified or bank cashier's check
payable to the order of the Company, free from all collection charges. If the
Employee so requests, shares of Stock purchased upon exercise of an warrant may
be issued in the name of the Employee or another person. The Employee shall not
be entitled to any rights as a stockholder of the Company in respect of any
shares of Stock covered by this
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<PAGE> 3
warrant until such shares of Stock shall have been paid for in full and issued
to the Employee.
5. As soon as practicable after the Company receives payment
for shares of Stock covered by this warrant, it shall deliver a certificate or
certificates representing the shares of Stock so purchased to the Employee. Such
certificate shall be registered in the name of the Employee, or in such other
name or names as the Employee shall request.
6. This warrant is personal to the Employee and during the
Employee's lifetime may be exercised only by the Employee. This warrant shall
not be transferable other than by will or the laws of descent and distribution.
7. In the event that the Employee's employment as an employee
of the Company or of any Subsidiary or Parent (hereinafter the "Employee's
employment") is terminated prior to the time that this warrant has been fully
exercised, this warrant shall be exercisable, as to any remaining shares of
Stock subject hereto, as follows:
(i) If the Employee's employment is terminated by action of
his employer, or by reason of disability or retirement under any
retirement plan maintained by the Company or any Subsidiary or Parent,
this warrant may be exercised by the Employee within three months after
such termination, but only as to any shares exercisable on the date the
Employee's employment so terminates;
(ii) In the event of the death of the Employee during the
three month period after termination of the Employee's employment
covered by (i) above, the person or persons to whom his rights are
transferred by will or the laws of descent and distribution shall have
a period of one year from the date of his death to exercise any
warrants which were exercisable by the Employee at the time of his
death; and
(iii) In the event of the death of the Employee during the
period of the Employee's employment, the warrant shall thereupon become
exercisable in full, and the person or persons to whom the Employee's
rights are transferred by will or the laws of descent and distribution
shall have a period of one year from the date of the Employee's death
to exercise such warrant.
Notwithstanding the foregoing, this warrant shall in no event
be exercisable after the date of termination of such warrant specified in
Section 2 hereof.
8. This warrant does not confer on the Employee any right to
continue as an employee of the Company or interfere in any way with the right of
the Company to determine the
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<PAGE> 4
terms of the Employee's employment.
9. In the event of a reorganization, recapitalization, stock
split, stock dividend, combination of shares, merger, consolidation, rights
offering, extraordinary dividend or divestiture (including a spin-off), or any
other change in the corporate structure or shares of the Company, the Committee
shall make such adjustments, if any, as it deems appropriate in the number and
kind of shares covered by this warrant, or in the warrant price per share
hereunder, or both.
10. This warrant shall be subject to the requirement that if
at any time the Board of Directors shall determine that the registration,
listing or qualification of the shares of Stock covered hereby upon any
securities exchange or under any federal or state law, or the consent or
approval of any governmental regulatory body is necessary or desirable as a
condition of, or in connection with, the granting of this warrant or the
purchase of shares of Stock hereunder, this warrant may not be exercised unless
and until such registration, listing, qualification, consent or approval shall
have been effected or obtained free of any conditions not acceptable to the
Board of Directors. The Committee may require that the person exercising this
warrant shall make such representations and agreements and furnish such
information as it deems appropriate to assure compliance with the foregoing or
any other applicable legal requirements.
11. It shall be a condition to the obligation of the Company
to issue shares of Stock upon exercise of this warrant, that the Employee (or
any beneficiary or person entitled to exercise such warrant) pay to the Company,
upon its demand, such amount as may be requested by the Company for the purpose
of satisfying any liability to withhold federal, state or local income or other
taxes. If the amount requested is not paid, the Company may refuse to issue such
shares of Stock.
12. All interpretations or determinations of the Committee
shall be binding and conclusive upon the Employee and his legal representatives
on any question arising hereunder.
13. All notices hereunder to the Company shall be delivered or
mailed to the following address:
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<PAGE> 5
Novametrix Medical Systems Inc.
5 Technology Drive
Wallingford, Connecticut 06492
Attention: Secretary
Such address for the service of notices may be changed at any time provided
notice of such change is furnished in advance to the Employee.
NOVAMETRIX MEDICAL SYSTEMS INC.
By_____________________________
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EXHIBIT 5
[Letterhead of Haythe & Curley]
July 24, 1998
Novametrix Medical Systems Inc.
5 Technology Drive
Wallingford, Connecticut 06492
Dear Sir or Madam:
We have acted as counsel for Novametrix Medical Systems Inc., a
Delaware corporation (the "Company"), in connection with the registration
statement on Form S-8 being filed by the Company under the Securities Act of
1933, as amended, with respect to 500,000 shares and 50,000 shares
(collectively, the "Shares") of Common Stock which have been or are to be
offered by the Company pursuant to, respectively, the Company's 1997 Long Term
Incentive Plan and Employee Warrants Plan.
In connection with such registration statement, we have examined such
records and documents and such questions of law as we have deemed appropriate
for purposes of this opinion. On the basis of such examination, we advise you
that in our opinion:
(1) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware; and
(2) the Shares have been duly and validly authorized and, when
issued and paid for in accordance with the terms of the respective plan
and stock options or warrants duly granted or to be granted thereunder,
will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
foregoing registration statement.
Very truly yours,
