As filed with the Securities and Exchange Commission on June
21, 2000
Registration No. 333-___________
SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Cardiac Science, Inc.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or
organization)
33-0465681
(I.R.S. employer identification number)
16931 Millikan Avenue
Irvine, California 92606
(Address of principal executive offices) (Zip code)
Cardiac Science, Inc. 1997 Stock Option/Stock Issuance
Plan
(Full title of the plan)
Raymond W. Cohen
Cardiac Science, Inc.
16931 Millikan Avenue
Irvine, California 92606
(Name and address of agent for service)
(949) 587-0357
Telephone number, including area code, of agent for
service.
- copy to -
Leonard J. Breslow, Esq.
Breslow & Walker, LLP
100 Jericho Quadrangle
Jericho, New York 11753
(516) 822-6505
CALCULATION OF REGISTRATION FEE
Title of
securities to
be registered
<PAGE>
Amount to be
registered(1)
<PAGE>
Proposed
maximum
offering price
per share
<PAGE>
Proposed
maximum
aggregate
offering
price
<PAGE>
Amount of
registration
fee
<PAGE>
Common Stock, par
value $.001 per share
("Common Stock")
1,500,000
(2)
$6,653,441(2)
$1,757
(1)Represents additional shares of Common Stock issuable
under the Cardiac Science, Inc. 1997 Stock Option/Stock
Issuance Plan (the "Plan") by virtue of an amendment to
the Plan increasing the number of shares issuable
thereunder from 1,305,000 to 2,805,000. Also covered
hereby are such additional shares as may be issuable in
accordance with the terms of the Plan as stock dividends or
in the event of a stock split, reorganization, merger,
recapitalization or similar event affecting the 1,500,000
shares being registered.
(2)Pursuant to Rule 457(h), the proposed maximum offeri
ng price per share and the proposed maximum aggregate
offering price have been calculated (a) with respect to
488,388 shares, on the basis of $4.92, the average of the
high and low prices of the Common Stock on the OTC
Bulletin Board on June 16, 2000, and (b) with respect to
1,011,612 shares, on the basis of the exercise price of
options previously granted.
INCORPORATION BY REFERENCE
Pursuant to General Instruction E on Form S-8 regarding
the registration of additional securities, Cardiac Science,
Inc. (the "Company") is hereby registering additional
shares of Common Stock in the number set forth on the
cover page of this Registration Statement. Such shares are
of the same class as other securities of the Company for
which previous registration statements have been filed with
the Securities and Exchange Commission relating to the
Plan, and such registration statements, as listed below, are
incorporated by reference herein:
Registration Statement on Form S-8 (Registration No. 333-
90169) filed on November 2, 1999.
Registration Statement on Form S-8 (Registration No. 333-
70171) filed on January 6, 1999.
ADDITIONAL INFORMATION
On
March 23, 2000, the Board of Directors of Registrant
approved an amendment to the Plan to increase the number
of shares of Common Stock issuable thereunder from
1,305,000 to 2,805,000. On May 19, 2000, the
stockholders of Registrant approved such amendment.
Currently, there are options to purchase 2,316,612 shares
of Common Stock issued and outstanding.
Item 8. Exhibits.
INDEX TO EXHIBITS
Exhibit
Description
<PAGE>
Sequentially
Numbered Page
Where Located
<PAGE>
4(a)
<PAGE>
Cardiac Science,
Inc. 1997 Stock
Option/Stock
Issuance Plan, as
amended
<PAGE>
7
<PAGE>
5
<PAGE>
Opinion of Messrs.
Breslow & Walker,
LLP as to the
legality of the
securities being
registered
<PAGE>
22
<PAGE>
23(a)
<PAGE>
Consent of
Independent
Accountants
<PAGE>
23
<PAGE>
23(b)
<PAGE>
Consent of Breslow
& Walker, LLP
(included in Exhibit
5)
<PAGE>
--
<PAGE>
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
Irvine, State of California, as of this 15th day of June,
2000.
CARDIAC SCIENCE, INC.
By:/s/ Raymond W. Cohen
Raymond W. Cohen, President and Chief Executive
Officer
(Principal Executive Officer)
/s/ Brett L. Scott
Brett L. Scott, Chief Financial Officer
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Act
of 1933, as amended, this Registration Statement has
been signed by the following persons in the capacities
and on the dates indicated.
Signature
<PAGE>
Title
<PAGE>
Date
<PAGE>
<PAGE>
<PAGE>
<PAGE>
/s/ Raymond W. Cohen
Raymond W. Cohen
<PAGE>
Director
<PAGE>
June 15, 2000
<PAGE>
<PAGE>
<PAGE>
<PAGE>
/s/ Paul D. Quadros
Paul D. Quadros
<PAGE>
Director
<PAGE>
June 15, 2000
/s/ Peter Crosby
Peter Crosby
Director
June 15, 2000
<PAGE>
<PAGE>
<PAGE>
<PAGE>
/s/ Howard L. Evers
Howard L. Evers
<PAGE>
Director
<PAGE>
June 15, 2000
<PAGE>
EXHIBIT INDEX
Exhibit
Description
<PAGE>
<PAGE>
4(a)
<PAGE>
Cardiac Science, Inc. 1997
Stock Option/Stock Issuance
Plan, as amended
<PAGE>
<PAGE>
5
<PAGE>
Opinion of Messrs. Breslow &
Walker, LLP as to the legality
of the securities being
registered
<PAGE>
<PAGE>
23(a)
<PAGE>
Consent of Independent
Accountants
<PAGE>
<PAGE>
23(b)
<PAGE>
Reference is made to Exhibit 5
with respect to the Consent of
Messrs. Breslow & Walker,
LLP
<PAGE>
Exhibit 4(a)
1997 STOCK OPTION/STOCK ISSUANCE PLAN
(Amended as of May 19, 2000)
ARTICLE ONE
GENERAL PROVISIONS
I. PURPOSE OF THE PLAN
This 1997 Stock Option/Stock Issuance Plan
is intended to promote the interests of Cardiac Science Inc,
a Delaware corporation, by providing eligible persons with
the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the
Corporation as an incentive for them to remain in the
service of the Corporation.
Capitalized terms herein shall have the
meanings assigned to such terms in the attached Appendix.
II. STRUCTURE OF THE PLAN
A. The Plan shall be divided into two (2)
separate equity programs:
(i) the Option Grant
Program under which eligible persons
may, at the discretion of the Plan
Administrator, be granted options to
purchase shares of Common Stock,
and
(ii) the Stock Issuance
Program under which eligible persons
may, at the discretion of the Plan
Administrator, be issued shares of
Common Stock directly, either
through the immediate purchase of
such shares or as a bonus for services
rendered the Corporation (or any
Parent or Subsidiary).
B. The provisions of Articles One and
Four shall apply to both equity programs under the Plan
and shall accordingly govern the interests of all persons
under the Plan.
III. ADMINISTRATION OF THE PLAN
A. The Plan shall be administered by the
Board. However, any or all administrative functions
otherwise exercisable by the Board may be delegated to the
Committee. Members of the Committee shall serve for
such period of time as the Board may determine and shall
be subject to removal by the Board at any time. The Board
may also at any time terminate the functions of the
Committee and reassume all powers and authority
previously delegated to the Committee.
B. The Plan Administrator shall have
full power and authority (subject to the provisions of the
Plan) to establish such rules and regulations as it may deem
appropriate for proper administration of the Plan and to
make such determinations under, and issue such
interpretations of, the Plan and any outstanding options
thereunder as it may deem necessary or advisable.
Decisions of the Plan Administrator shall be final and
binding on all parties who have an interest in the Plan or
any option thereunder.
IV. ELIGIBILITY
A. The persons eligible to participate in
the Plan are as follows:
(i) Employees,
(ii) non-employee
members of the Board or the non-
employee members of the board of
directors of any Parent or Subsidiary,
and
(iii) consultants and other
independent advisors who provide
services to the Corporation (or any
Parent or Subsidiary).
B. The Plan Administrator shall have
full authority to determine, (i) with respect to the grants
under the Option Grant Program, which eligible persons
are to receive the option grants, the time or times when
those grants are to be made, the number of shares to be
covered by each such grant, the status of the granted option
as either an Incentive Option or a Non-Statutory Option,
the time or times when each option is to become
exercisable, the vesting schedule (if any) applicable to the
option shares and the maximum term for which the option
is to remain outstanding, and (ii) with respect to stock
issuances under the Stock Issuance Program, which eligible
persons are to receive such stock issuances, the time or
times when such issuances are to be made, the number of
shares to be issued to each Participant, the vesting schedule
(if any) applicable to the issued shares and the
consideration to be paid by the Participant for such shares.
C. The Plan Administrator shall have the
absolute discretion either to grant options in accordance
with the Option Grant Program or to effect stock issuances
in accordance with the Stock Issuance Program.
V. STOCK SUBJECT TO THE PLAN
A. The stock issuable under the Plan
shall be shares of authorized but unissued or reacquired
Common Stock. The maximum number of shares of
Common Stock which may be issued over the term of the
Plan shall not exceed two million eight hundred five
thousand (2,805,000) shares.
B. Shares of Common Stock subject to
outstanding options shall be available for subsequent
issuance under the Plan to the extent (i) the options expire
or terminate for any reason prior to exercise in full or
(ii) the options are canceled in accordance with the
cancellation-regrant provisions of Article Two. Unvested
shares issued under the Plan and subsequently repurchased
by the Corporation, at the option exercise price or direct
issue price paid per share, pursuant to the Corporation's
repurchase rights under the Plan shall be added back to the
number of shares of Common Stock reserved for issuance
under the Plan and shall accordingly be available for
reissuance through one or more subsequent option grants or
direct stock issuances under the Plan.
C. Should any change be made to the
Common Stock by reason of any stock split, stock
dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding
Common Stock as a class without the Corporation's receipt
of consideration, appropriate adjustments shall be made to
(i) the maximum number and/or class of securities issuable
under the Plan and (ii) the number and/or class of
securities and the exercise price per share in effect under
each outstanding option in order to prevent the dilution or
enlargement of benefits thereunder. The adjustments
determined by the Plan Administrator shall be final,
binding and conclusive. In no event shall any such
adjustments be made in connection with the conversion of
one or more outstanding shares of the Corporation's
preferred stock into shares of Common Stock.
ARTICLE TWO
OPTION GRANT PROGRAM
I. OPTION TERMS
Each option shall be evidenced by one or
more documents in the form approved by the Plan
Administrator; provided, however, that each such document
shall comply with the terms specified below. Each
document evidencing an Incentive Option shall, in addition,
be subject to the provisions of the Plan applicable to such
options.
A. Exercise Price.
1. The exercise price per share
shall be fixed by the Plan Administrator in accordance with
the following provisions:
(i) The exercise
price per share shall not be less than
eighty-five percent (85%) of the Fair
Market Value per share of Common
Stock on the option grant date.
(ii) If the person to
whom the option is granted is a 10%
Stockholder, then the exercise price
per share shall not be less than one
hundred ten percent (110%) of the
Fair Market Value per share of
Common Stock on the option grant
date.
Currently, there are approximately thirty
persons who are eligible to participate in the Plan.
2. The exercise price shall become
immediately due upon exercise of the option and shall,
subject to the provisions of Section I of Article Four and
the documents evidencing the option, be payable in cash or
check made payable to the Corporation. Should the
Common Stock be registered under Section 12(g) of the
1934 Act at the time the option is exercised, then the
exercise price may also be paid as follows:
(i) in shares of Common
Stock held for the requisite period
necessary to avoid a charge to the
Corporation's earnings for financial
reporting purposes and valued at Fair
Market Value on the Exercise Date,
or
(ii) to the extent the option
is exercised for vested shares,
through a special sale and remittance
procedure pursuant to which the
Optionee shall concurrently provide
irrevocable instructions (A) to a
Corporation-designated brokerage
firm to effect the immediate sale of
the purchased shares and remit to the
Corporation, out of the sale proceeds
available on the settlement date,
sufficient funds to cover the
aggregate exercise price payable for
the purchased shares plus all
applicable Federal, state and local
income and employment taxes
required to be withheld by the
Corporation by reason of such
exercise and (B) to the Corporation to
deliver the certificates for the
purchased shares directly to such
brokerage firm in order to complete
the sale.
Except to the extent such sale and remittance procedure is
utilized, payment of the exercise price for the
purchased shares must be made on the Exercise
Date.
B. Exercise and Term of Options. Each
option shall be exercisable at such time or times, during
such period and for such number of shares as shall be
determined by the Plan Administrator and set forth in the
documents evidencing the option grant. However, no
option shall have a term in excess of ten (10) years
measured from the option grant date.
C. Effect of Termination of Service.
1. The following provisions shall
govern the exercise of any options held by the Optionee at
the time of cessation of Service or death:
(i) Should the
Optionee cease to remain in Service
for any reason other than Disability
or Misconduct, then the Optionee
shall have a period of three (3)
months following the date of such
cessation of Service during which to
exercise each outstanding option held
by such Optionee.
(ii) Should
Optionee's Service terminate by
reason of Disability, then the
Optionee shall have a period of
twelve (12) months following the date
of such cessation of Service during
which to exercise each outstanding
option held by such Optionee.
(iii) If the Optionee
dies while holding an outstanding
option, then the personal
representative of his or her estate or
the person or persons to whom the
option is transferred pursuant to the
Optionee's will or the laws of
inheritance shall have a twelve (12)-
month period following the date of
the Optionee's death to exercise such
option.
(iv) Under no
circumstances, however, shall any
such option be exercisable after the
specified expiration of the option
term.
(v) During the
applicable post-Service exercise
period, the option may not be
exercised in the aggregate for more
than the number of vested shares for
which the option is exercisable on the
date of the Optionee's cessation of
Service. Upon the expiration of the
applicable exercise period or (if
earlier) upon the expiration of the
option term, the option shall
terminate and cease to be outstanding
for any vested shares for which the
option has not been exercised.
However, the option shall,
immediately upon the Optionee's
cessation of Service, terminate and
cease to be outstanding with respect
to any and all option shares for which
the option is not otherwise at the time
exercisable or in which the Optionee
is not otherwise at that time vested.
(vi) Should
Optionee's Service be terminated for
Misconduct, then all outstanding
options held by the Optionee shall
terminate immediately and cease to
remain outstanding.
2. The Plan
Administrator shall have the
discretion, exercisable either at the
time an option is granted or at any
time while the option remains
outstanding, to:
(i) extend the
period of time for which the
option is to remain
exercisable following
Optionee's cessation of
Service or death from the
limited period otherwise in
effect for that option to such
greater period of time as the
Plan Administrator shall
deem appropriate, but in no
event beyond the expiration
of the option term, and/or
(ii) permit the
option to be exercised,
during the applicable post-
Service exercise period, not
only with respect to the
number of vested shares of
Common Stock for which
such option is exercisable at
the time of the Optionee's
cessation of Service but also
with respect to one or more
additional installments in
which the Optionee would
have vested under the option
had the Optionee continued in
Service.
D. Stockholder Rights. The holder of an
option shall have no stockholder rights with respect to the
shares subject to the option until such person shall have
exercised the option, paid the exercise price and become a
holder of record of the purchased shares.
E. Unvested Shares. The Plan
Administrator shall have the discretion to grant options
which are exercisable for unvested shares of Common
Stock. Should the Optionee cease Service while holding
such unvested shares, the Corporation shall have the right
to repurchase, at the exercise price paid per share, any or
all of those unvested shares. The terms upon which such
repurchase right shall be exercisable (including the period
and procedure for exercise and the appropriate vesting
schedule for the purchased shares) shall be established by
the Plan Administrator and set forth in the document
evidencing such repurchase right. The Plan Administrator
may not impose a vesting schedule upon any option grant
or the shares of Common Stock subject to that option
which is more restrictive than twenty percent (20%) per
year vesting, with the initial vesting to occur not later than
one (1) year after the option grant date. However, such
limitation shall not be applicable to any option grants made
to individuals who are officers of the Corporation, non-
employee Board members or independent consultants.
F. Limited Transferability of Options.
During the lifetime of the Optionee, the option shall be
exercisable only by the Optionee and shall not be
assignable or transferable other than by will or by the laws
of descent and distribution following the Optionee's death.
G. Withholding. The Corporation's
obligation to deliver shares of Common Stock upon the
exercise of any options granted under the Plan shall be
subject to the satisfaction of all applicable Federal, state
and local income and employment tax withholding
requirements.
II. INCENTIVE OPTIONS
The terms specified below shall be applicable
to all Incentive Options. Except as modified by the
provisions of this Section II, all the provisions of the Plan
shall be applicable to Incentive Options. Options which are
specifically designated as Non-Statutory Options shall not
be subject to the terms of this Section II.
A. Eligibility. Incentive Options may
only be granted to Employees.
B. Exercise Price. The exercise price
per share shall not be less than one hundred percent
(100%) of the Fair Market Value per share of Common
Stock on the option grant date.
C. Dollar Limitation. The aggregate
Fair Market Value of the shares of Common Stock
(determined as of the respective date or dates of grant) for
which one or more options granted to any Employee under
the Plan (or any other option plan of the Corporation or
any Parent or Subsidiary) may for the first time become
exercisable as Incentive Options during any one (1)
calendar year shall not exceed the sum of One Hundred
Thousand Dollars ($100,000). To the extent the Employee
holds two (2) or more such options which become
exercisable for the first time in the same calendar year, the
foregoing limitation on the exercisability of such options as
Incentive Options shall be applied on the basis of the order
in which such options are granted.
D. 10% Stockholder. If any Employee
to whom an Incentive Option is granted is a 10%
Stockholder, then the option term shall not exceed five (5)
years measured from the option grant date.
III. CORPORATE TRANSACTION
A. The shares subject to each option
outstanding under the Plan at the time of a Corporate
Transaction shall automatically vest in full so that each
such option shall, immediately prior to the effective date of
the Corporate Transaction, become fully exercisable for all
of the shares of Common Stock at the time subject to that
option and may be exercised for any or all of those shares
as fully-vested shares of Common Stock.
B. All outstanding repurchase rights
shall also terminate automatically, and the shares of
Common Stock subject to those terminated rights shall
immediately vest in full, in the event of any Corporate
Transaction.
C. Immediately following the
consummation of the Corporate Transaction, all outstanding
options shall terminate and cease to be outstanding, except
to the extent assumed by the successor corporation (or
parent thereof).
D. Each option which is assumed in
connection with a Corporate Transaction shall be
appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities
which would have been issuable to the Optionee in
consummation of such Corporate Transaction, had the
option been exercised immediately prior to such Corporate
Transaction. Appropriate adjustments shall also be made
to (i) the number and class of securities available for
issuance under the Plan following the consummation of
such Corporate Transaction and (ii) the exercise price
payable per share under each outstanding option, provided
the aggregate exercise price payable for such securities
shall remain the same.
E. The Plan Administrator shall have the
discretion, exercisable either at the time the option is
granted or at any time while the option remains
outstanding, to provide for the automatic acceleration (in
whole or in part) of one or more outstanding options (and
the immediate termination of the Corporation's repurchase
rights with respect to the shares.
ARTICLE THREE
STOCK ISSUANCE PROGRAM
I. STOCK ISSUANCE TERMS
Shares of Common Stock may be issued
under the Stock Issuance Program through direct and
immediate issuances without any intervening option grants.
Each such stock issuance shall be evidenced by a Stock
Issuance Agreement which complies with the terms
specified below.
A. Purchase Price.
1. The purchase price per share
shall be fixed by the Plan Administrator but shall not be
less than eighty-five percent (85 %) of the Fair Market
Value per share of Common Stock on the issue date.
However, the purchase price per share of Common Stock
issued to a 10% Stockholder shall not be less than one
hundred and ten percent (110%) of such Fair Market
Value.
2. Subject to the provisions of
Section I of Article Four, shares of Common Stock may be
issued under the Stock Issuance Program for any of the
following items of consideration which the Plan
Administrator may deem appropriate in each individual
instance:
(i) cash or check
made payable to the Corporation, or
(ii) past services
rendered to the Corporation (or any
Parent or Subsidiary).
B. Vesting Provisions.
1. Shares of Common Stock
issued under the Stock Issuance Program may, in the
discretion of the Plan Administrator, be fully and
immediately vested upon issuance or may vest in one or
more installments over the Participant's period of Service
or upon attainment of specified performance objectives.
However, the Plan Administrator may not impose a vesting
schedule upon any stock issuance effected under the Stock
Issuance Program which is more restrictive than twenty
percent (20%) per year vesting, with initial vesting to occur
not later than one (1) year after the issuance date. Such
limitation shall not apply to any Common Stock issuances
made to the officers of the Corporation, non-employee
Board members or independent consultants.
2. Any new, substituted or
additional securities or other property (including money
paid other than as a regular cash dividend) which the
Participant may have the right to receive with respect to the
Participant's unvested shares of Common Stock by reason
of any stock dividend, stock split, recapitalization,
combination of shares, exchange of shares or other change
affecting the outstanding Common Stock as a class without
the Corporation's receipt of consideration shall be issued
subject to (i) the same vesting requirements applicable to
the Participant's unvested shares of Common Stock and
(ii) such escrow arrangements as the Plan Administrator
shall deem appropriate.
3. The Participant shall have full
stockholder rights with respect to any shares of Common
Stock issued to the Participant under the Stock Issuance
Program, whether or not the Participant's interest in those
shares is vested. Accordingly, the Participant shall have
the right to vote such shares and to receive any regular
cash dividends paid on such shares.
4. Should the Participant cease to
remain in Service while holding one or more unvested
shares of Common Stock issued under the Stock Issuance
Program or should the performance objectives not be
attained with respect to one or more such unvested shares
of Common Stock, then those shares shall be immediately
surrendered to the Corporation for cancellation, and the
Participant shall have no further stockholder rights with
respect to those shares. To the extent the surrendered
shares were previously issued to the Participant for
consideration paid in cash or cash equivalent (including the
Participant's purchase-money indebtedness), the
Corporation shall repay to the Participant the cash
consideration paid for the surrendered shares and shall
cancel the unpaid principal balance of any outstanding
purchase-money note of the Participant attributable to such
surrendered shares.
5. The Plan Administrator may
in its discretion waive the surrender and cancellation of one
or more unvested shares of Common Stock (or other assets
attributable thereto) which would otherwise occur upon the
non-completion of the vesting schedule applicable to such
shares. Such waiver shall result in the immediate vesting
of the Participant's interest in the shares of Common Stock
as to which the waiver applies. Such waiver may be
effected at any time, whether before or after the
Participant's cessation of Service or the attainment or non-
attainment of the applicable performance objectives.
II. CORPORATE TRANSACTION
Upon the occurrence of a Corporate
Transaction, all outstanding repurchase rights under the
Stock Issuance Program shall terminate automatically, and
the shares of Common Stock subject to those terminated
rights shall immediately vest in full.
III. SHARE ESCROW/LEGENDS
Unvested shares may, in the Plan
Administrator's discretion, be held in escrow by the
Corporation until the Participant's interest in such shares
vests or may be issued directly to the Participant with
restrictive legends on the certificates evidencing those
unvested shares.
ARTICLE FOUR
MISCELLANEOUS
I. FINANCING
The Plan Administrator may permit any
Optionee or Participant to pay the option exercise price
under the Discretionary Option Grant Program or the
purchase price of shares issued under the Stock Issuance
Program by delivering a full-recourse, interest bearing
promissory note payable in one or more installments. The
terms of any such promissory note (including the interest
rate and the terms of repayment) shall be established by the
Plan Administrator in its sole discretion. In no event may
the maximum credit available to the Optionee or Participant
exceed the sum of (i) the aggregate option exercise price or
purchase price payable for the purchased shares (less the
par value of those shares) plus (ii) any Federal, state and
local income and employment tax liability incurred by the
Optionee or the Participant in connection with the option
exercise or share purchase.
II. EFFECTIVE DATE AND TERM OF
PLAN
A. The Plan shall become effective when
adopted by the Board, but no option granted under the Plan
may be exercised, and no shares shall be issued under the
Plan, until the Plan is approved by the Corporation's
stockholders. If such stockholder approval is not obtained
within twelve (12) months after the date of the Board's
adoption of the Plan, then all options previously granted
under the Plan shall terminate and cease to be outstanding,
and no further options shall be granted and no shares shall
be issued under the Plan. Subject to such limitation, the
Plan Administrator may grant options and issue shares
under the Plan at any time after the effective date of the
Plan and before the date fixed herein for termination of the
Plan.
B. The Plan shall terminate upon the
earliest of (i) the expiration of the ten (10)-year period
measured from the date the Plan is adopted by the Board,
(ii) the date on which all shares available for issuance
under the Plan shall have been issued as vested shares or
(iii) the termination of all outstanding options in connection
with a Corporate Transaction. All options and unvested
stock issuances outstanding at that time under the Plan shall
continue to have full force and effect in accordance with
the provisions of the documents evidencing such options or
issuances.
III. AMENDMENT OF THE PLAN
A. The Board shall have complete and
exclusive power and authority to amend or modify the Plan
in any or all respects. However, no such amendment or
modification shall adversely affect the rights and
obligations with respect to options or unvested stock
issuances at the time outstanding under the Plan unless the
Optionee or the Participant consents to such amendment or
modification. In addition, certain amendments may require
stockholder approval pursuant to applicable laws and
regulations.
B. Options may be granted under the
Option Grant Program and shares may be issued under the
Stock Issuance Program which are in each instance in
excess of the number of shares of Common Stock then
available for issuance under the Plan, provided any excess
shares actually issued under those programs shall be held
in escrow until there is obtained stockholder approval of an
amendment sufficiently increasing the number of shares of
Common Stock available for issuance under the Plan. If
such stockholder approval is not obtained within twelve
(12) months after the date the first such excess shares are
made, then (i) any unexercised options granted on the basis
of such excess shares shall terminate and cease to be
outstanding and (ii) the Corporation shall promptly refund
to the Optionees and the Participants the exercise or
purchase price paid for any excess shares issued under the
Plan and held in escrow, together with interest (at the
applicable Short Term Federal Rate) for the period the
shares were held in escrow, and such shares shall
thereupon be automatically canceled and cease to be
outstanding.
IV. USE OF PROCEEDS
Any cash proceeds received by the
Corporation from the sale of shares of Common Stock
under the Plan shall be used for general corporate
purposes.
V. WITHHOLDING
The Corporation's obligation to deliver
shares of Common Stock upon the exercise of any options
or upon the vesting of any shares issued under the Plan
shall be subject to the satisfaction of all applicable Federal,
state and local income and employment tax withholding
requirements.
VI. REGULATORY APPROVALS
The implementation of the Plan, the granting
of any options under the Plan and the issuance of any
shares of Common Stock (i) upon the exercise of any
option or (ii) under the Stock Issuance Program shall be
subject to the Corporation's procurement of all approvals
and permits required by regulatory authorities having
jurisdiction over the Plan, the options granted under it and
the shares of Common Stock issued pursuant to it.
VII. NO EMPLOYMENT OR SERVICE
RIGHTS
Nothing in the Plan shall confer upon the
Optionee or the Participant any right to continue in Service
for any period of specific duration or interfere with or
otherwise restrict in any way the rights of the Corporation
(or any Parent or Subsidiary employing or retaining such
person) or of the Optionee or the Participant, which rights
are hereby expressly reserved by each, to terminate such
person's Service at any time for any reason, with or
without cause.
VIII. FINANCIAL REPORTS
The Corporation shall deliver a balance sheet
and an income statement at least annually to each individual
holding an outstanding option under the Plan, unless such
individual is a key Employee whose duties in connection
with the Corporation (or any Parent or Subsidiary) assure
such individual access to equivalent information.
APPENDIX
The following definitions shall be in effect under the
Plan:
A. Board shall mean the Corporation's Board of
Directors.
B. Code shall mean the Internal Revenue Code
of 1986, as amended.
C. Committee shall mean a committee of two (2)
or more Board members appointed by the Board to exercise
one or more administrative functions under the Plan.
D. Common Stock shall mean the Corporation's
common stock.
E. Corporate Transaction shall mean either of
the following stockholder-approved transactions to which
the Corporation is a party:
(a) a merger or consolidation in
which securities possessing more than fifty
percent (50%) of the total combined voting
power of the Corporation's outstanding
securities are transferred to a person or
persons different from the persons holding
those securities immediately prior to such
transaction, or
(b) the sale, transfer or other
disposition of all or substantially all of the
Corporation's assets in complete liquidation
or dissolution of the Corporation.
F. Corporation shall mean Cardiac Science Inc,
a Delaware corporation.
G. Disability shall mean the inability of the
Optionee or the Participant to engage in any substantial
gainful activity by reason of any medically determinable
physical or mental impairment and shall be determined by
the Plan Administrator on the basis of such medical
evidence as the Plan Administrator deems warranted under
the circumstances.
H. Employee shall mean an individual who is in
the employ of the Corporation (or any Parent or
Subsidiary), subject to the control and direction of the
employer entity as to both the work to be performed and
the manner and method of performance.
I. Exercise Date shall mean the date on which
the Corporation shall have received written notice of the
option exercise.
J. Fair Market Value per share of Common
Stock on any relevant date shall be determined in
accordance with the following provisions:
(a) If the Common Stock is at the
time traded on the Nasdaq National Market,
then the Fair Market Value shall be the
closing selling price per share of Common
Stock on the date in question, as such price
is reported by the National Association of
Securities Dealers on the Nasdaq National
Market. If there is no closing selling price
for the Common Stock on the date in
question, then the Fair Market Value shall
be the closing selling price on the last
preceding date for which such quotation
exists.
(b) If the Common Stock is at the
time listed on any Stock Exchange, then the
Fair Market Value shall be the closing
selling price per share of Common Stock on
the date in question on the Stock Exchange
determined by the Plan Administrator to be
the primary market for the Common Stock,
as such price is officially quoted in the
composite tape of transactions on such
exchange. If there is no closing selling price
for the Common Stock on the date in
question, then the Fair Market Value shall
be the closing selling price on the last
preceding date for which such quotation
exists.
(c) If the Common Stock is at the
time neither listed on any Stock Exchange
nor traded on the Nasdaq National Market,
then the Fair Market Value shall be
determined by the Plan Administrator after
taking into account such factors as the Plan
Administrator shall deem appropriate.
K. Incentive Option shall mean an option which
satisfies the requirements of Code Section 422.
L. Involuntary Termination shall mean the
termination of the Service of any individual which occurs
by reason of:
(a) such individual's involuntary
dismissal or discharge by the Corporation for
reasons other than Misconduct, or
(b) such individual's voluntary
resignation following (A) a change in his or
her position with the Corporation which
materially reduces his or her level of
responsibility, (B) a reduction in his or her
level of compensation (including base salary,
fringe benefits and target bonuses under any
corporate-performance based bonus or
incentive programs) by more than fifteen
percent (15%) or (C) a relocation of such
individual's place of employment by more
than fifty (50) miles, provided and only if
such change, reduction or relocation is
effected without the individual's consent.
M. Misconduct shall mean the commission of
any act of fraud, embezzlement or dishonesty by the
Optionee or Participant, any unauthorized use or disclosure
by such person of confidential information or trade secrets
of the Corporation (or any Parent or Subsidiary), or any
other intentional misconduct by such person adversely
affecting the business or affairs of the Corporation (or any
Parent or Subsidiary) in a material manner. The foregoing
definition shall not be deemed to be inclusive of all the acts
or omissions which the Corporation (or any Parent or
Subsidiary) may consider as grounds for the dismissal or
discharge of any Optionee, Participant or other person in
the Service of the Corporation (or any Parent or
Subsidiary).
N. 1934 Act shall mean the Securities Exchange
Act of 1934, as amended.
O. Non-Statutory Option shall mean an option
not intended to satisfy the requirements of Code
Section 422.
P. Option Grant Program shall mean the option
grant program in effect under the Plan.
Q. Optionee shall mean any person to whom an
option is granted under the Plan.
R. Parent shall mean any corporation (other than
the Corporation) in an unbroken chain of corporations
ending with the Corporation, provided each corporation in
the unbroken chain (other than the Corporation) owns, at
the time of the determination, stock possessing fifty percent
(50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such
chain.
S. Participant shall mean any person who is
issued shares of Common Stock under the Stock Issuance
Program.
T. Plan shall mean the Corporation's 1997 Stock
Option/Stock Issuance Plan, as set forth in this document.
U. Plan Administrator shall mean either the
Board or the Committee acting in its capacity as
administrator of the Plan.
V. Service shall mean the provision of services
to the Corporation (or any Parent or Subsidiary) by a
person in the capacity of an Employee, a non-employee
member of the board of directors or a consultant or
independent advisor, except to the extent otherwise
specifically provided in the documents evidencing the
option grant.
W. Stock Exchange shall mean either the
American Stock Exchange or the New York Stock
Exchange.
X. Stock Issuance Agreement shall mean the
agreement entered into by the Corporation and the
Participant at the time of issuance of shares of Common
Stock under the Stock Issuance Program.
Y. Stock Issuance Program shall mean the stock
issuance program in effect under the Plan.
Z. Subsidiary shall mean any corporation (other
than the Corporation) in an unbroken chain of corporations
beginning with the Corporation, provided each corporation
(other than the last corporation) in the unbroken chain
owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting
power of all classes of stock in one of the other
corporations in such chain.
AA. 10% Stockholder shall mean the owner of
stock (as determined under Code Section 424(d)) possessing
more than ten percent (10%) of the total combined voting
power of all classes of stock of the Corporation (or any
Parent or Subsidiary).
<PAGE>
Exhibit 5
June 15, 2000
Board of Directors
Cardiac Science, Inc.
16931 Millikan Avenue
Irvine, California 92606
Ladies and Gentlemen:
It is our opinion that the sale of the securities being
registered with the Securities and Exchange Commission
pursuant to the Registration Statement of Cardiac Science,
Inc. (the "Company") on Form S-8, which securities are to
be offered to the Company's employees, directors,
consultants and advisors pursuant to the Company's 1997
Stock Option/Stock Issuance Plan, will, when sold and paid
for, be validly issued, fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit
of the aforesaid Registration Statement. In giving such
consent, we do not consider that we are "experts" within
the meaning of such term as used in the Securities Act of
1933, as amended, or the rules and regulations of the
Securities and Exchange Commission issued thereunder
with respect to any part of the Registration Statement,
including this opinion, as an exhibit or otherwise.
Sincerely,
/s/ Breslow & Walker, LLP
Breslow & Walker, LLP
Exhibit 23 (a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in
this Registration Statement on Form S-8 of our report
dated February 25, 2000, which contained an explanatory
paragraph regarding the Company's ability to continue as
a going concern, relating to the consolidated financial
statements, which appears in Cardiac Science, Inc.'s
Annual Report on Form 10-K for the year ended
December 31, 1999.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Costa Mesa, California
June 15, 2000
