One of the founding members of the NetHack DevTeam was Izchak Miller. Professor Miller passed away on the 1st of April 1994 at the age of 58, from complications due to cancer. The DevTeam put Izchak the shopkeeper into the game as a tribute, inspired partly by his work on the shopkeeper code. The character on the navigation imagemap on the NetHack site is also named after him.
Although there are no special in-game penalties for doing so, some players consider it extremely poor form to kill this particular shopkeeper. The NetHack community itself is somewhat divided on this issue - in #nethack, hardly anybody cares; in RGRN, at least several vocal regulars will usually reprimand any transgressions; and the wiki itself sees a broad mix of editors' opinions. For extinctionist games, it is considered acceptable to leave Izchak alive.