**Exhibit10.56**

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement  (hereinafter this “Agreement”) dated as of May 30, 2002 (the“Effective Date”) by and between i-STAT CORPORATION, a Delaware corporationhaving a place of business at 104 Windsor Center Drive, East Windsor, NewJersey 08520 (the “Company”), and LORIN J. RANDALL, an individual residing at120 S. Wawaset Road, West Chester, Pennsylvania 19382 (“Employee”).

 

WITNESSETH:

 

WHEREAS, the Company desires to employ Employee andEmployee desires to be employed by the Company, all pursuant to the terms andconditions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the premises andthe mutual covenants herein contained, the receipt and sufficiency of which arehereby acknowledged, and intending to be legally bound hereby, it is agreed asfollows:

 

Section 1.  Definitions.  Unless otherwise defined herein, thefollowing terms shall have the following respective meanings:

 

“Benefit” means those benefits set forth inSection 3.3 hereof.

 

“Cause” means (i) any felony conviction oradmission of guilt, (ii) any breach or nonobservance by Employee of anymaterial covenant set forth herein, (iii) any willful, intentional ordeliberate disobedience or neglect by Employee of the lawful and reasonableorders or directions of the Chief Executive Officer of the Company; provided,that the Chief Executive Officer of the Company has given Employee writtennotice of such disobedience or neglect and Employee has failed to cure suchdisobedience or neglect within a period reasonable under the circumstances, or(iv) any willful or deliberate misconduct by employee that is materiallyinjurious to the Company.

 

“Change of Control” shall mean any of thefollowing:

 

A.            Anacquisition (other than directly from the Company) of any voting securities ofthe Company (the “Voting Securities”) by any “Person” (as the term “person” isused for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of1934, as amended (the “1934 Act”) immediately after which such Person has“Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the1934 Act) of thirty percent (30%) or more of the combined voting power of theCompany’s then outstanding Voting Securities; provided, however, that indetermining whether a Change

 

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of Control has occurred, Voting Securities which are acquired in a“Non-Control Acquisition” (as defined below) shall not constitute anacquisition which would cause a Change of Control.   A “Non-Control Acquisition” shall mean an acquisition by (i) anemployee benefit plan (or trust forming a part thereof) maintained by (x) theCompany or (y) any corporation or other Person of which a majority of itsvoting power or its equity securities or equity interest is owned directly orindirectly by the Company (a “Subsidiary”), (ii) the Company or any Subsidiary,or (iii) any Person in connection with a Non-Control Transaction (as definedbelow).

 

B.            Theindividuals who, as of the date immediately before any “Change of Control” setforth in clauses A or C hereof, are members of the Board (the “IncumbentBoard”), cease for any reason to constitute at least a majority of the Board; provided,further, that no individual shall be considered a member of the Incumbent Boardif such individual initially assumed office as a result of either an actual orthreatened “Election Contest” (as described in Rule 14a-11 promulgated underthe 1934 Act) or other actual or threatened solicitation of proxies or consentsby or on behalf of a Person other than the Board (a “Proxy Contest”) includingby reason of any agreement intended to avoid or settle any Election Contest orProxy Contest.

 

C.            Approvalby the stockholders of the Company of:

 

(i)         Amerger, consolidation, or reorganization involving the Company, unless:

 

(1)           Thestockholders of the Company, immediately before such merger, consolidation orreorganization, own, directly or indirectly, immediately following such merger,consolidation or reorganization, at least a majority of the combined votingpower of the outstanding voting securities of the corporation resulting fromsuch merger or consolidation or reorganization (the “Surviving Corporation”) insubstantially the same proportion as their ownership of the Voting Securitiesimmediately before such merger, consolidation, or reorganization; and

 

(2)           Theindividuals who were members of the Incumbent Board immediately prior to theexecution of the agreement providing for such merger, consolidation, orreorganization constitute at least a majority of the members of the board ofdirectors of the Surviving Corporation or corporation Beneficially Owning,directly or indirectly, a majority of the voting securities of the SurvivingCorporation; and

 

(3)           NoPerson (other than the Company, any Subsidiary, any employee benefit plan (orany trust forming a part thereof) maintained by the Company, the SurvivingCorporation, any Subsidiary, or any Person who, immediately prior to suchmerger, consolidation or reorganization had Beneficial Ownership of fifteenpercent (15%) or more of the then outstanding Voting Securities) owns, directlyor indirectly, thirty percent (30%) or more of the combined voting power of theSurviving Corporation’s then outstanding voting securities.

 

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(4)           Atransaction described in the foregoing clauses (1) through (3) shall herein bereferred to as a “Non-Control Transaction”.

 

(ii)           Acomplete liquidation or dissolution of the Company; or

 

(iii)          Asale or other disposition of all or substantially all of the assets of theCompany to any Person (other than a transfer to a Subsidiary).

 

D.            Notwithstandingthe foregoing, a Change of Control shall not be deemed to occur solely because(i) any Person (the “Subject Person”) acquired Beneficial Ownership of more thanthe permitted amount of the outstanding Voting Securities as a result of theacquisition of Voting Securities by the Company which by reducing the number ofVoting Securities outstanding, increases the proportional number of sharesbeneficially owned by the Subject Person; provided, that if a Change ofControl would occur (but for the operation of this sentence) as a result of theacquisition of Voting Securities by the Company, and after such acquisition bythe Company, the Subject Person becomes the Beneficial Owner of any additionalVoting Securities which increases the percentage of the then outstanding VotingSecurities beneficially owned by the Subject Person to a percentage sufficientto constitute a Change of Control, then a Change of Control shall be deemed tohave occurred; or (ii) the acquisition of Voting Securities by holders of theCompany’s Series D Convertible Preferred Stock, par value $.10 per share.

 

“Common Stock” means the common stock of theCompany, par value $.15 per share.

 

“Diminution in Responsibility” means a materialdiminution in Employee’s duties or responsibilities or the assignment toEmployee of duties which are materially inconsistent with his duties as SeniorVice President and Chief Financial Officer of the Company or which materiallyimpair Employee’s ability to function in his position; provided,however, that no Diminution in Responsibility shall be deemed to have occurredsolely as a result of the consummation by the Company of a strategic corporatealliance, partnership or joint venture (in whatever form) pursuant to which anysubstantial portion of the Company’s marketing and sales activities, orresearch and development activities, or manufacturing activities come under thecontrol of any entity unaffiliated with the Company on the Effective Date.

 

“Permanent Disability” means Employee’sinability to substantially perform his duties and responsibilities hereunder byreason of any physical or mental incapacity for a period of 180 consecutivedays, or two or more periods of 90 consecutive days each in any 360-day period.

 

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Section 2.               Employment; Duties.

 

2.1           Duringthe Term of Employment (as hereinafter defined), the Company shall employEmployee, and Employee shall serve, as Senior Vice President — Finance, ChiefFinancial Officer and Treasurer of the Company.  Employee’s responsibilities shall include such functions andduties with respect to the Company and its subsidiaries as the Chief ExecutiveOfficer or the Board of Directors of the Company (the “Board”) shall determineand that are consistent with the functions and duties of a chief financialofficer of a corporation of similar size and nature.

 

2.2           Duringthe Term of Employment and excluding any periods of vacation and sick leave towhich Employee is entitled, (a) Employee shall devote all of his business timeto the business and affairs of the Company (except as provided below) and shalluse his best efforts to perform faithfully and efficiently the responsibilitiesassigned to Employee, (b) Employee shall apply his skill and experience to theperformance of his duties in such employment, and (c) Employee shall have noother employment.  During the Term ofEmployment, it shall not be a violation of this Agreement for Employee todevote up to two business days per calendar quarter to:  (i) serve as a director, officer or trusteeof any trade association or of any civic, educational or charitableorganization, (ii) with the prior consent of the Board, which shall not beunreasonably withheld, serve as director of any corporation that does notcompete, directly or indirectly, with the Company, and (iii) manage hispersonal investments (provided, that no such investment may exceed fivepercent (5%) of the equity securities of any entity without the prior writtenapproval of the Board and further provided, that nothing herein shalllimit any investment in an entity whose primary purpose is not the day-to-dayoperation of a particular business) and affairs.  Subject to the limitation in the preceding sentence, the Companyhereby consents to Employee serving as a member of the board of directors ofPoint 5 Technologies, Inc., provided, that Point 5 Technologies, Inc.does not engage in any business that is competitive with the Company’sbusiness.

 

Section 3.               Compensation And Benefits.

 

3.1           BaseSalary.  During the Term ofEmployee’s employment hereunder, the Company shall pay Employee a salary at theannual rate of Two Hundred Fifty-Seven Thousand Two Hundred Fifty dollars ($257,250)or such greater amount as the Company’s Board of Directors may from time totime establish pursuant to the terms hereof (the “Base Salary”).  Such Base Salary shall be reviewed annuallyand may be increased, but not decreased, by the Board of Directors of theCompany in its sole discretion. The Base Salary shall be payable in accordancewith the Company’s customary payroll practices for its senior managementpersonnel.

 

3.2           Bonus.

 

(a)           SigningBonus.  On the Effective Date, theCompany will award to Employee Ten Thousand (10,000) shares of Common Stock,pursuant to the Company’s Equity Incentive Plan, as amended (the “IncentivePlan”), which shall not be subject to forfeiture by Employee or repurchase byCompany under any circumstances.

 

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This award will be evidenced by an agreement in customary form forgrants of Common Stock to executive officers under the Incentive Plan,consistent with the terms and conditions of this Agreement.

 

(b)           PerformanceBonus.  During the term ofEmployee’s employment hereunder, Employee shall be eligible to participate inthe Company’s Annual Incentive Program (the “AIP”). For each fiscal year of theCompany ending during the Employment Term (as hereinafter defined), Employeeshall receive a bonus equal to not less than (i) 7.5% of the Base Salary incash, and options under the Incentive Plan (“Performance Bonus Options”) topurchase not less than 5,000 shares of Common Stock of the Company (“Shares”),for achieving the Minimum Level under the AIP; (ii) 15.0% of the Base Salary incash, and Performance Bonus Options to purchase not less than 10,000 Shares,for achieving the Target Level under the AIP; and (iii) 22.5% of the BaseSalary in cash, and Performance Bonus Options to purchase not less than 15,000Shares, for achieving the Maximum Level under the AIP (collectively, the“Bonus”). Employee recognizes that the Board of Directors of the Companyreserves the right to amend or terminate the AIP at any time, in which case theCompany shall substitute therefor such other benefits and programs as shallprovide Employee with a substantially equivalent opportunity to derivesubstantially equivalent rewards for performance.

 

3.3           Benefits.

 

(a)           BenefitPlans. During the Employment Term, Employee may participate, on the samebasis and subject to the same qualifications as other senior managementpersonnel of the Company, in any benefit plans and policies in effect withrespect to senior management personnel of the Company.

 

(b)           Reimbursementof Expenses. During the Employment Term, Company shall pay or promptlyreimburse Employee, upon submission of proper invoices in accordance with theCompany’s normal procedures, for all reasonable out-of-pocket business,entertainment and travel expenses incurred by Employee in the performance ofhis duties hereunder.

 

(c)           Vacation.During the Employment Term, Employee shall be entitled to vacations inaccordance with the policies of the Company applicable to senior managementpersonnel from time to time.

 

(d)           Post-RetirementBenefits. Employee shall be entitled to any post-retirement benefitsgenerally made available to the Company’s senior management personnel.

 

(e)           Withholding.The Company shall be entitled to withhold from amounts payable or benefitsaccorded to Employee under this Agreement all federal, state and local income,employment and other taxes, as and in such amounts as may be required byapplicable law.

 

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3.4           Stock Options.

 

(a)           InitialGrant.  On or prior to the datehereof, the Company shall grant to Employee an option (the “Initial StockOption”) to purchase Twenty-Five Thousand (25,000) shares of Common Stock at anexercise price of $5.08 per share pursuant to the terms of the IncentivePlan.  The Initial Stock Option shallbecome exercisable over a five-year term with respect to 20% of such shares oneach anniversary of the date of grant.

 

(b)           StrategicIncentive Program Grant.   TheCompany shall grant to Employee an option (the “SIP Option”) to purchase SixtyThousand (60,000) shares of Common Stock at an exercise price per share to bedetermined on the date of grant pursuant to the terms of the IncentivePlan.  The SIP Option shall becomeexercisable in full on the seventh anniversary of the date of grant.

 

(c)           AcceleratedVesting of SIP Options.  Subject toEmployee’s satisfactory achievement of certain performance criteria, asdetermined by the Chief Executive Officer and approved by the Board ofDirectors, consistent with Employee’s duties and responsibilities, the SIPOption shall become exercisable with respect to (i) 20,000 shares on June 30,2003, (ii) 20,000 shares on June 30, 2004, and (iii) all remaining shares onDecember 31, 2004.

 

(d)           AcceleratedVesting of Options Due to Termination of Employment or Change of Control.  Notwithstanding Sections 3.2(b), 3.4(a),3.4(b) and 3.4(c) hereof, the Performance Bonus Options, Initial Stock Optionand the SIP Option shall automatically become fully exercisable upon theearlier to occur of (i) a Change of Control, (ii) the termination by Employeeof his employment with the Company for Good Reason (as hereinafter defined), or(iii) the termination of Employee’s employment without Cause pursuant toSection 5(d)(iii) hereof.

 

(e)           OptionAgreements.  The Performance BonusOptions, the Initial Stock Option and the SIP Option shall be evidenced byagreements in customary form for grants of stock options under the IncentivePlan to executive officers of the Company, consistent with the terms andconditions of this Agreement.

 

3.5           Relocation.

 

(a)           Reimbursement.  The Company shall reimburse Employee up toSixty-five Thousand dollars ($65,000) for the cost of relocating Employee’shousehold to the East Windsor, New Jersey area, including but not limited tothe cost of transportation of household goods, farm equipment and animals andreal estate sales commissions and related expenses (the “Relocation Costs”); provided,that such relocation shall be completed within twenty-four (24) months afterthe Effective Date.

 

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(b)           Withholding.  The Company shall, in accordance with itsnormal policies and procedures for the payment of withholding tax, pay to theInternal Revenue Service and the appropriate state and local revenueauthorities (collectively, the “Tax Authorities”), on behalf of Employee, anamount equal to the federal (including, without limitation, Medicare taxes),state and local income taxes (the foregoing taxes are hereinafter collectivelyreferred to as “Income Taxes”) required to be withheld in connection withpayment of the Relocation Costs.

 

(c)           Gross-Up.  To the extent that, as a result of thepayment of all or any portion of the Relocation Costs to Employee by theCompany as provided in this Section 3.5, Employee is obligated to pay anyincome, payroll or other taxes to the Tax Authorities, the Company shall pay toEmployee, or on behalf of Employee, as the case may be, the sum of (i) allIncome Taxes due by Employee as a result of reimbursement of the RelocationCosts, plus (ii) an amount equal to any and all Income Taxes paid or requiredto be paid with respect to the receipt of the amount set forth in clause (i)above (including, without limitation, any taxes on such additional amount). Itis the intention of the parties hereto that the Company will pay on behalf ofEmployee any withholding tax due in connection with reimbursement of theRelocation Costs and that the Company will pay to Employee any out-of-pockettax liability Employee experiences in connection with reimbursement of theRelocation Costs. Any amounts payable by the Company to Employee pursuant tothis Section 3.5(c) shall be paid no later than five (5) business days beforeEmployee is obligated to pay any taxes to the Tax Authorities.

 

(d)           TemporaryLiving.  The Company shall provide afurnished apartment for Employee’s use, including utilities, in the EastWindsor, New Jersey area until Employee’s relocation is complete, but in noevent after May 30, 2004.

 

3.6           Term. This Agreement shall remain in fullforce and effect for an initial period of four (4) years from the EffectiveDate (the “Employment Term”) and the Employment Term shall be automaticallyextended for additional one-year periods thereafter (each a “Renewal Period”)unless Employee notifies the Board of Directors or the Board of Directorsnotifies Employee that the notifying party does not desire to extend suchEmployment Term at least ninety (90) days prior to the end of the expiration ofthe Employment Term.  Employee’semployment hereunder shall be coterminous with the Employment Term, unlesssooner terminated as provided in Section 5 hereof.

 

Section 4.               RepresentationsAnd Warranties By Employee And The Company.

 

4.1           Employeehereby represents and warrants to the Company as follows:

 

(a)           Theperformance by Employee of his duties and other obligations hereunder will notconflict with or constitute a default under (whether immediately, upon thegiving of notice or lapse of time or both) any prior employment agreement,contract, or other instrument to which is a party or by which he is bound.

 

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(b)           Employeehas the right, power and legal capacity to enter and deliver this Agreement andto perform his duties and other obligations hereunder. This Agreementconstitutes the legal, valid and binding obligation of Employee enforceableagainst him in accordance with its terms.

 

4.2           The Company hereby represents andwarrants to Employee as follows:

 

(a)           TheCompany is duly organized, validly existing and in good standing under the lawsof the State of Delaware, with all requisite corporate power and authority toown its properties and conduct its business in the manner presentlycontemplated.

 

(b)           TheCompany has full power and authority to enter into this Agreement and to incurand perform its obligations hereunder.

 

(c)           Theexecution, delivery and performance by the Company of this Agreement does notand will not conflict with or result in a breach or violation of or constitutea default under (whether immediately, upon the giving of notice or lapse oftime or both) the certificate of incorporation or by-laws of the Company, orany agreement or instrument to which the Company is a party or by which theCompany or any of its properties may be bound or affected.

 

Section 5.               Termination.  Employee’s employment hereunder will beginon the Effective Date and shall continue until terminated upon the first tooccur of the following events:

 

(a)           Deathor Permanent Disability of Employee. The Company may, at its option, terminate Employee’s employment forPermanent Disability (as herein defined). In the event of termination for deathor disability, Employee or his designated beneficiary shall be entitled totermination benefits pursuant to Section 5(d) hereof.

 

(b)           Terminationby the Company for Cause.  In theevent of termination by the Company pursuant to this Section 5(b), the Companyshall have no further obligations to Employee under this Agreement other thanto (i) pay Employee’s then current Base Salary through the effective date oftermination, and (ii) subject to the terms hereof, pay or provide any benefitswhich may be due to Employee.

 

(c)           Terminationby Employee for Good Reason.  In theevent of termination by Employee for Good Reason (as defined below) pursuant tothis Section 5(c), (i) all unvested options granted to Employee shall vestimmediately as of the date of such termination, (ii) within five (5) daysfollowing the date of such termination, the Company shall pay Employee histarget annual bonus for the current fiscal year on a pro rata basiscorresponding to the date of termination, and (iii) continue to pay Employee 

 

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monthly compensation equal to one-twelfth of Employee’s then currentBase Salary plus annual target bonus for a period of eighteen (18) monthsfollowing the date of termination. Employee’s right to terminate his employment pursuant to this Section5(c) shall not be affected by his incapacity due to Permanent Disability.  The following actions or omissions by theCompany shall constitute “Good Reason”:

 

(A)          If aDiminution of Responsibility occurs, Employee may, at his sole option byproviding written notice to the Company within sixty (60) days following suchDiminution of Responsibility, deem such Diminution of Responsibility to be“Good Reason” under this Section 5(c); or

 

(B)           Thefailure of the Company to obtain an agreement, satisfactory to Employee, fromany successor or assignee of all or substantially all of the Company’sbusiness, to assume the Company’s obligations to Employee under this Agreement.

 

(d)           Terminationby the Company without Cause.

 

(i)         TheCompany shall give Employee not less than thirty (30) days prior written noticeof the termination of his employment without Cause and the Company shall havethe option of terminating Employee’s duties and responsibilities prior to theexpiration of the thirty-day notice period subject to payment on or prior tothe date of such termination by the Company of Employee’s then current BaseSalary for the remainder of the notice period and his target annual bonus forthe current fiscal year on a pro rata basis corresponding to the date oftermination.

 

(ii)        Ifsuch termination shall occur, the Company shall continue to pay Employeemonthly compensation equal to one-twelfth of Employee’s then current BaseSalary plus annual target bonus for a period of twelve (12) months followingthe date of termination.

 

(iii)       Ifsuch termination shall occur within the eighteen (18) month period following aChange of Control, then in lieu of amounts due under paragraph (ii) above, theCompany shall (A) pay Employee his target annual bonus for the current fiscalyear on a pro rata basis corresponding to the date of termination, (B) continueto pay Employee monthly compensation equal to one-twelfth of Employee’s thencurrent Base Salary plus annual target bonus for a period of eighteen (18)months following the date of termination and (C) immediately accelerate the exercisabilityof all unvested stock options granted to Employee to purchase Common Stock asof the date of such termination.

 

(e)           Terminationby Employee without Good Reason.  Inthe event Employee wishes to resign without Good Reason, he shall give not lessthan thirty (30) days prior written notice of such resignation and the Companyshall have the option of terminating Employee’s duties and responsibilities atany time prior to Employee’s

 

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proposed termination date, subject to payment by the Company toEmployee of the lesser of (i) Employee’s then current Base Salary for a thirty(30) day period, or (ii) such portion of the period remaining under the noticegiven by Employee.

 

(f)            TerminationDue to Non-Renewal of Agreement by the Company.  In the event the Company notifies Employee under Section 3.6 thatit shall not renew this Agreement for any Renewal Period, Employee shall beentitled to monthly compensation equal to one-twelfth of Employee’s then currentBase Salary plus annual target bonus for a period of twelve (12) monthsfollowing the end of the Employment Term.

 

Section 6.               ChangeOf Control.  Notwithstandinganything contained in this Agreement to the contrary, if Employee’s employmentis terminated by the Company, other than for Cause, prior to a Change ofControl and such termination (i) was at the request of a third party who hasindicated an intention or taken steps reasonably calculated to effect a Changeof Control and who effectuates a Change of Control (a “Third Party”), or (ii)otherwise occurred as a condition to, or in connection with or anticipation of,a Change of Control which actually occurs, then for all purposes of thisAgreement, the date of the Change of Control with respect to Employee shallmean the date immediately prior to the date of such termination of Employee’semployment and shall entitle Employee to the benefits provided under Section5(c) of this Agreement as though the termination of Employee’s employment wasfor Good Reason.

 

Section 7.               Federal Excise Tax.

 

7.1           GeneralRule.  Employee’s payments andbenefits under this Agreement and all other arrangements or programs relatedthereto shall not, in the aggregate, exceed the maximum amount that may be paidto Employee without triggering golden parachute penalties under Section 280G ofthe Internal Revenue Code of 1986, as amended (the “Code”), and the provisionsrelated thereto with respect to such payments. If Employee’s benefits must be cut back to avoid triggering suchpenalties, Employee’s benefits will be cut back in the priority order Employeedesignates or, if Employee fails to promptly designate an order, in thepriority order designated by the Company. If an amount in excess of the limit set forth in this Section is paid toEmployee, Employee must repay the excess amount to the Company upon demand,with interest at the rate provided in Code Section 1274(b)(2)(B).  Employee and the Company agree to cooperatewith each other reasonably in connection with any administrative or judicialproceedings concerning the existence or amount of golden parachute penalties onpayments or benefits Employee receives.

 

7.2           Exception.  Section 7.1 shall apply only if it increasesthe net amount Employee would realize from payments and benefits subject toSection 7.1, after payment of income and excise taxes by Employee on suchpayments and benefits.

 

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7.3           Determinations.  The determination of whether the goldenparachute penalties under Code Section 280G and the provisions related theretoshall be made by counsel chosen by Employee and reasonably acceptable to theCompany. All other determinations needed to apply this Section 7 shall be madein good faith by the Company’s independent auditors.

 

Section 8.               ExtendedMedical And Dental Benefits.  In theevent of the termination of Employee’s employment under Sections 5(a), 5(c) or5(d) of this Agreement, and at Employee’s election, Employee and Employee’sdependents shall continue to receive the Company’s standard employee medicaland dental benefits at the Company’s expense under such plans for (i) twelve(12) months for termination under Sections 5(a), or 5(d)(i) or 5(d)(ii) hereof,or (ii) eighteen (18) months for termination under Section 5(c) or Section5(d)(iii) hereof.  Notwithstanding theforegoing, in the event Employee becomes covered or eligible to be covered as aprimary insured (that is, not as a beneficiary under a spouse’s plan) underanother employer’s group health plan during the extended benefit periodsprovided for herein, Employee shall promptly notify the Company and the Companyshall have no further obligation to provide group health benefits for Employeeand any dependents.

 

Section 9.               ConfidentialityAgreement.  Employee agrees toexecute an Employee Confidentiality and Invention Agreement with the Company,in a form customarily employed by the Company, which provides for standardnon-solicitation and non-competition covenants covering a period of twelve (12)months after Employee ceases to be employed by the Company for any reason or noreason.

 

Section 10.             ReleaseOf Claims.  The Company maycondition payment of the cash termination benefits described in Sections 5(a),5(c) or 5(d) of this Agreement upon the delivery by Employee of a signedrelease of claims in a form customarily employed by the Company; provided,however, that Employee shall not be required to release any rights Employee mayhave to be indemnified by the Company under Section 11.5 of this Agreement orthe certificate of incorporation or by-laws of the Company.

 

Section 11.             General.

 

11.1               Notices.  Any notice or other communication under thisAgreement shall be in writing and shall be deemed to have been given:  (i) upon delivery when delivered personally;(ii) the next business day after being sent by Federal Express or similarovernight delivery prepaid; or (iii) three (3) days after being mailed viaregistered or certified mail, postage prepaid, return receipt requested, toeither party at the address set forth in the preamble of this Agreement, or tosuch other address as such party shall give by notice hereunder to the otherparty.

 

11.2               Severabilityof Provisions.  If any provision ofthis Agreement shall be declared by a court of competent jurisdiction to beinvalid, illegal or incapable of being enforced in whole or in part, suchprovision shall be interpreted so as to remain 

 

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enforceable to the maximum extent permissible consistent with applicablelaw and the remaining conditions and provisions or portions thereof shallnevertheless remain in full force and effect and enforceable to the extent theyare valid, legal and enforceable, and no provision shall be deemed dependentupon any other covenant or provision unless so expressed herein.

 

11.3               BindingEffect.  This Agreement shall bebinding upon and shall inure to the benefit of the Company, its successors andassigns and the Company shall require any successors and assigns to expresslyassume and agree to perform this Agreement in the same manner and to the sameextent that the Company would be required to perform it if no such successionor assignment had taken place.

 

11.4               EntireAgreement Modification. This Agreement and the exhibits attached heretocontains the entire agreement of the parties relating to the subject matterhereof, and any prior agreements or understandings between the parties heretowhich are not set forth herein are hereby superceded.  No modification of this Agreement shall be valid unless made inwriting and signed by the parties hereto.

 

11.5               Indemnification.  The Company and Employee shall execute anindemnification agreement in the form attached hereto as Exhibit A.

 

11.6               GoverningLaw.  This Agreement shall begoverned by and construed and enforced in accordance with the laws of the Stateof New Jersey without regard to principles of conflict of laws.

 

11.7               Headings.  The headings of paragraphs are inserted forconvenience and shall not affect any interpretation of this Agreement.

 

11.8               Counterparts.  This Agreement may be executed in one ormore counterparts, each of which shall be deemed an original, and all of whichtogether shall be deemed to be one and the same instrument.

 

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IN WITNESS WHEREOF, the parties hereto, intending tobe legally bound hereby, have executed this Agreement as of the day and yearfirst above written.

 
|   | LORIN J. RANDALL                      |
|--------|---------------------------------------|
|   |                                  |
|   |                                  |
|   | /s/ Lorin J. Randall                  |   |
|   | Lorin J. Randall                      |
|   |                                  |
|   |                                  |
|   | i-STAT CORPORATION                    |
|   |                                  |
|   |                                  |
|   | /s/ William P. Moffitt                |   |
|   | William P. Moffitt                    |
|   | President and Chief Executive Officer |

 

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