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                                                                     Exhibit 10i

                               ATRION CORPORATION

                    1998 OUTSIDE DIRECTORS STOCK OPTION PLAN

              (As Amended And Restated Effective August 12, 1999)

                           ARTICLE 1 - ESTABLISHMENT,
                              PURPOSE AND DURATION


1.1 Establishment of the Plan. Atrion Corporation, a Delaware Corporation (the
"Company"), hereby establishes a compensation plan to be known as the "Atrion
Corporation 1998 Outside Directors Stock Option Plan" (the "Plan"), as set forth
herein.

1.2 Purpose of the Plan. The purpose of the Plan is to promote the interests of
the Company by providing incentives, which are linked directly to increases in
stockholder value, to attract qualified persons who are not employees of the
Company to serve, and continue their service, as members of the Company's Board
of Directors (the "Board").

1.3 Duration of the Plan. The Plan shall be effective on January 21, 1998, the
date of its adoption by the Board (the "Effective Date"), subject to approval by
the Company's stockholders within twelve (12) months thereafter, such approval
to be by stockholder vote sufficient to satisfy the requirements of The Nasdaq
Stock Market, and shall remain in effect, subject to the right of the Board to
amend or terminate the Plan at any time in accordance with the provisions
hereof, until all shares of common stock of the Company ("Shares") subject to
the Plan shall have been purchased in accordance with the provisions hereof or
the Options to which such Shares are subject shall have been surrendered before
exercise or shall have lapsed.

                            ARTICLE 2 - DEFINITIONS

Whenever used in the Plan, the following capitalized terms shall have the
meanings set forth below:

2.1 "Board" means the Board of Directors of the Company.

2.2 "Chairman" means the Chairman of the Board of the Company.


2.3 "Code" means the Internal Revenue Code of 1986, as amended from time to
time, and references thereto shall include the applicable Treasury regulations
thereunder.

2.4 "Common Stock" means the ten cent ($0.10) par value common stock of the
Company.

2.5 "Committee" means the committee described in Section 3.1 hereof.
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2.6 "Company" means Atrion Corporation, a Delaware corporation, and any
successor as provided in Article 11 hereof.

2.7 "Disability" means physical or mental inability to perform the normal duties
of service as a member of the Board as determined by a physician selected by the
Committee after an examination of such Optionee; provided, that if such Optionee
fails or refuses to cooperate in such examination the determination of his
Disability shall be made by the Committee in its sole discretion.

2.8 "Effective Date" means the date described in Section 1.3 hereof.

2.9 "Fair Market Value" as of any date means the closing sales price of a Share
on such date as reported by (i) any national securities exchange on which the
Shares are actively traded or (ii) The Nasdaq Stock Market or, if no Shares are
traded on such exchange or system on such date, then on the next preceding date
on which any Shares were traded on such exchange or system.

2.10 "Option" means an option to purchase Shares from the Company granted
pursuant to Article 5 hereof which does not meet the requirements of Section 422
of the Code.

2.11 "Option Price" means the price at which a Share may be purchased by an
Optionee pursuant to the exercise of an Option.

2.12 "Optionee" means an Outside Director who has been granted an Option which
is outstanding hereunder.

2.13 "Outside Director" means any person who is a member of the Board, including
the Chairman, who is not an employee of the Company or any Subsidiary.

2.14 "Plan" means the Atrion Corporation 1998 Outside Directors Stock Option
Plan.

2.15 "Shares" means the shares of Common Stock of the Company.

2.16 "Stock Option Agreement" means a written agreement between the Company and
an Optionee setting forth the terms and provisions applicable to an Option
granted by the Company to such Optionee hereunder.

2.17 "Subsidiary" means any corporation, partnership, joint venture, affiliate
or other entity of which a majority of the voting stock or power is beneficially
owned, directly or indirectly, by the Company.

                           ARTICLE 3 - ADMINISTRATION

3.1 Authority of Board or Committee. This Plan shall be administered by the
Board or by a committee appointed by the Board (the "Committee"). In the event
the Board fails to appoint or refrains from appointing a Committee, the Board
shall have all power and
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authority to administer this Plan. In such event, the word "Committee" wherever
used herein shall be deemed to mean the Board. The Committee shall, subject to
the provisions of the Plan, have the power to construe this Plan, to determine
all questions hereunder, and to adopt and amend such rules and regulations for
the administration of this Plan as it may deem desirable. No member of the Board
or the Committee shall be liable for any action or determination made in good
faith with respect to this Plan or any option granted under it.

3.2 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan shall be final, conclusive and binding on
all persons, including the Company, its directors and their estates and
beneficiaries.

                       ARTICLE 4 - SHARES SUBJECT TO PLAN

4.1 Available Shares. The total number of Shares for which Options may be
granted under this Plan shall not exceed 270,000 Shares, subject to adjustment
in accordance with Section 4.2 hereof. Shares subject to this Plan are
authorized but unissued Common Stock or Common Stock that was once issued and
subsequently reacquired by the Company. If any Options granted under this Plan
are surrendered before exercise or lapse without exercise, in whole or in part,
the Shares subject to such grant shall not again be available for the grant of
Options under this Plan.

4.2 Adjustments in Shares. In the event of any change in corporate
capitalization, such as a stock dividend or stock split, or a corporate
transaction, such as any merger, consolidation, separation, including a
spin-off, or other distribution of stock or property of the Company, any
reorganization (whether or not such reorganization comes within the definition
of such term in Section 368 of the Code) or any partial or complete liquidation
of the Company, an appropriate adjustment shall be made in the number and class
of Shares reserved under the Plan, in the number, class and Option Price of
Shares subject to the unexercised portion of outstanding Options granted under
the Plan, and the number of Shares that are to be subject to, and are to be
included in, each future grant of Options to be made in accordance with Section
5.1 hereof, as may be necessary to prevent dilution or enlargement of rights;
provided, however, that the number of Shares subject to any Option shall always
be a whole number.

                              ARTICLE 5 - OPTIONS

5.1 Annual Grants; Option Price. On each of February 1, 1998 and February 1,
1999, each person who is then serving as a member of the Board and is an Outside
Director, other than the Chairman, shall be granted automatically, without any
action by the Committee, an Option to purchase Ten Thousand (10,000) Shares,
subject to adjustment in accordance with Section 4.2 of this Plan, and the
person who is then serving as Chairman, if he is an Outside Director, shall be
granted automatically, without any action by the Committee, an Option to
purchase Twenty Thousand (20,000) Shares, subject to adjustment in accordance
with Section 4.2 of this Plan. The Option Price shall equal the Fair Market
Value of the Common Stock as of the date of grant.
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5.2 Vesting. Each Option granted hereunder shall vest, and thereby become
exercisable, in four (4) equal quarterly installments on the May 1, August 1,
November 1 and February 1 next succeeding the date on which such Option is
granted; provided, however, that for each such installment to vest the Optionee
shall then be serving as an Outside Director on the vesting date for such
installment.

5.3 Period of Option. Unless sooner terminated in accordance with the provisions
of Section 5.4 below, each Option shall expire on the date which is ten (10)
years after the date on which the Option is granted.

5.4 Termination of Outside Directorship. In the event an Optionee ceases to be
an Outside Director for any reason other than death or Disability, such Optionee
shall have the right to exercise his Options at any time within six (6) months,
or in the case of an Optionee who has then served as a member of the Board of
Directors of the Company or any of its predecessors for at least twenty (20)
years, within eighteen (18) months, after the date on which he ceased to be an
Outside Director to the extent of the full number of Shares he was entitled to
purchase on exercise of the Options on the date of cessation, subject to the
condition that no Option shall be exercisable after the expiration of the term
of the Option as provided in Section 5.3 above. In the event Optionee ceases to
be an Outside Director by reason of Optionee's death or Disability, such Options
may be exercised at any time within twelve (12) months, or in the case of an
Optionee who has then served as a member of the Board of Directors of the
Company or any of its predecessors for at least twenty (20) years, within
eighteen (18) months, after the date on which he ceased to be an Outside
Director by Optionee or Optionee's legal representative, in the case of
Disability, or by Optionee's heir or legatee or the personal representative,
administrator or executor of Optionee's estate, in the case of death, to the
extent of the full number of Shares the Optionee was entitled to purchase on
exercise of the Option on the date of cessation, subject to the condition that
no Option shall be exercisable after the term of the Option as provided in
Section 5.3 above.

5.5 Non-Transferability of Option. No Option shall be transferable by an
Optionee except by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order, and during Optionee's lifetime his Options
shall be exercisable only by Optionee or the transferee of the Option pursuant
to a qualified domestic relations order, except as otherwise specifically
provided in Section 5.4 above in the case of Optionee's Disability.

5.6 Exercise of Options. The Shares subject to an Option may be purchased in
such installments and on such exercise dates as shall be set forth in the Plan
or the Stock Option Agreement. Any Shares not purchased on the applicable
exercise date may be purchased thereafter at any time prior to the final
expiration of the Option, subject to the
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provisions of Section 5.4 above. In no event shall any Option be exercised, in
whole or in part, after its expiration date.

5.7 Payment. Options shall be exercised by the delivery of a written notice of
exercise to the Company, setting forth the number of Shares with respect to
which the Option is to be exercised, accompanied by full payment for the Shares.
The Option Price upon exercise of any Option shall be payable to the Company:
(a) in cash or its equivalent, or (b) by tendering previously acquired Shares
having an aggregate Fair Market Value at the time of exercise equal to the
aggregate Option Price, or (c) by a combination of (a) and (b). The Committee
also may allow cashless exercise or payment by any other means which the
Committee determines to be consistent with the Plan's purpose and applicable
law. As soon as practicable after receipt of a written notification of exercise
and full payment, the Company shall deliver to the Optionee, in the Optionee's
name, Share certificates in an appropriate amount based upon the number of
Shares purchased under the Option.

5.8 Restrictions on Transferability. The Committee may impose such restrictions
on the transfer of Shares acquired pursuant to the exercise of an Option granted
under this Plan as it may deem advisable including, without limitation,
restrictions under applicable federal securities laws, under the requirements of
any stock exchange or market upon which the Common Stock is then listed or
traded and under any state securities laws applicable to such Shares.

5.9 Stock Option Agreements. Each Option granted shall be evidenced by a Stock
Option Agreement that shall specify the Option Price, the term of the Option,
the number of Shares subject to such Option and such other provisions as the
Committee shall determine which are not inconsistent with the provisions of the
Plan.

                        ARTICLE 6 - LIMITATION OF RIGHTS

6.1 No Right to Continue as a Director. Neither the Plan nor any action taken
pursuant to the Plan shall confer upon any Outside Director any right to
continue as a director of the Company for any period of time or at any
particular rate of compensation.

6.2 No Stockholder Rights. An Optionee shall have no rights as a stockholder
with respect to the Shares subject to Options until the date of issuance to such
Optionee of the stock certificate following the exercise of the Option therefor.

                      ARTICLE 7 - BENEFICIARY DESIGNATIONS

Each Optionee may, from time to time, designate any beneficiary or beneficiaries
(who may be named contingently or successively) to whom any benefit under the
Plan is to be paid in case of his death before he receives any or all of such
benefit. Each such designation shall revoke all prior designations by the same
Optionee, shall be in a form prescribed by the Company, and will be effective
only when filed by the Optionee in writing with the Company during the
Optionee's lifetime. In the absence of any such


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designation, benefits remaining unpaid at the Optionee's death shall be paid to
the Optionee's estate.

              ARTICLE 8 - AMENDMENT, MODIFICATION AND TERMINATION

The Board may at any time, and from time to time, alter, amend, discontinue,
suspend or terminate the Plan in whole or in part; provided, however, that no
amendment or modification made without stockholder approval may (i) increase
the number of Shares subject to the Plan (except as provided in Section 4.2
hereof), (ii) materially modify the requirements as to eligibility to receive
Options under the Plan or (iii) materially increase benefits accruing to
Outside Directors hereunder and no termination, amendment, or modification of
the Plan shall adversely affect in any material way any Option previously
granted under the Plan without the written consent of the Optionee holding such
Option.

                            ARTICLE 9 - WITHHOLDING

9.1 Tax Withholding. The Company shall have the power and the right to deduct or
withhold, or require an Optionee to remit to the Company, an amount sufficient
to satisfy federal, state and local taxes (including the Optionee's FICA
obligation) required by law to be withheld with respect to any taxable event
arising as a result of this Plan.

9.2 Share Withholding. With respect to withholding required upon the exercise of
Options, Optionee may elect, subject to the approval of the Committee, to
satisfy the withholding requirement, in whole or in part, by having the Company
withhold Shares having a Fair Market Value on the date as of which the tax is to
be determined equal to the minimum statutory total tax which could be imposed on
the transaction. All such elections shall be irrevocable, made in writing,
signed by the Optionee, and subject to any restrictions or limitations that the
Committee, in its sole discretion, deems appropriate.

                          ARTICLE 10 - INDEMNIFICATION

Each person who is or shall have been a member of the Committee shall be
indemnified and held harmless by the Company against and from any loss, cost,
liability, or expense that may be imposed upon or reasonably incurred by him in
connection with or resulting from any claim, action, suit, or proceeding to
which he may be a party or in which he may be involved by reason of any action
taken or failure to act under the Plan and against and from any and all amounts
paid by him in settlement thereof, with the Company's approval, or paid by him
in satisfaction of any judgment in any such action, suit, or proceeding against
him, provided he shall give the Company an opportunity, at its own expense, to
defend the same before he undertakes to defend it on his own behalf. The
foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the Company's
Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any
power that the Company may have to indemnify them or hold them harmless.


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                            ARTICLE 11 - SUCCESSORS

All obligations of the Company under the Plan with respect to Options granted
hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
or assets of the Company.

                           ARTICLE 12 - MISCELLANEOUS

12.1 Gender and Number. Whenever the context so requires, the singular shall
include the plural and the plural shall include the singular and the gender of
any pronoun shall include the other gender.

12.2 Severability. The invalidity of this Plan with respect to one or more
persons shall not affect the rights and obligations of any other person
hereunder in any manner whatsoever. The invalidity of one or more provisions of
this Plan shall not affect the validity of any other provision of this Plan in
any manner whatsoever.

12.3 Requirements of Law. The granting of Options and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.

12.4 Securities Laws Compliance. Transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended. To the extent any provision of the
Plan or action by the Committee fails to so comply, it shall be deemed null and
void, to the extent permitted by law and deemed advisable by the Committee.

12.5 Governing Law. This Plan shall be construed according to the laws of the
State of Delaware.