{"id":40172,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/nonqualified-stock-option-plan-and-agreement-sutter-surgery7.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"nonqualified-stock-option-plan-and-agreement-sutter-surgery7","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/nonqualified-stock-option-plan-and-agreement-sutter-surgery7.html","title":{"rendered":"Nonqualified Stock Option Plan and Agreement &#8211; Sutter Surgery Centers Inc. and August A. Saibeni"},"content":{"rendered":"<pre>\n         THE OPTION GRANTED PURSUANT TO THIS NONSTATUTORY STOCK OPTION AGREEMENT\n(THE 'OPTION') AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE  HEREOF\nHAVE NOT BEEN  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE\n'SECURITIES ACT'), AND MAY NOT BE PLEDGED,  HYPOTHECATED,  SOLD,  TRANSFERRED OR\nOTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE  REGISTRATION STATEMENT FOR\nTHE OPTION OR THE SHARES  UNDER THE  SECURITIES  ACT,  OR AN OPINION OF COUNSEL,\nWHICH IS SATISFACTORY TO THE COMPANY AND ITS COUNSEL,  THAT SUCH REGISTRATION IS\nNOT REQUIRED.\n\n                   SUTTER SURGERY CENTERS, INC., NONQUALIFIED\n                   STOCK OPTION PLAN AND AGREEMENT (SAIBENI)\n\n         THIS  AGREEMENT is entered into as of December 1, 1992,  between SUTTER\nSURGERY CENTERS,  INC., a Delaware  corporation  (the 'Company'),  and AUGUST A.\nSAIBENI (the 'Optionee').\n\n                                    Recitals\n\n         A. The  Company's  Board of Directors  ('Board') has  established  this\nNonqualified  Stock Option Plan and Agreement  ('Agreement') in order to provide\nthe Optionee with an opportunity to acquire common stock of the Company;  and \n\n         B. The Board has  determined  that it would be in the best interests of\nthe  Company  and its  stockholders  to  grant  the  Nonqualified  Stock  Option\ndescribed in this  Agreement to the Optionee as an  inducement to enter into and\nremain in the  employ  of the  Company  and as an  incentive  for  extraordinary\nefforts during such employment.\n\n         NOW, THEREFORE, it is agreed as follows:\n\n                                    Agreement\n\nARTICLE 1. GRANT OF OPTION.\n\n         1.01.  Option.  On the terms and conditions  stated below,  the Company\nhereby  grants to the  Optionee  the option to purchase  One Million  Thirty-One\nThousand Nine Hundred Ninety- Two  (1,031,992)  Shares for the sum of ONE DOLLAR\n($1.00)  per Share,  the Fair  Market  Value of the  Shares.  This Option is not\nintended to be an incentive stock option described in section 422 of the Code.\n\n         1.02.  Representation and Warranty. The Company represents and warrants\nthat, as of the effective date of this Agreement:\n\n\n\n\n                  A. Nineteen  Million Six Hundred Seven  Thousand Eight Hundred\nForty- Three (19,607,843) shares of Common Stock are issued and outstanding;\n\n                  B.  The  Common  Stock  subject  to  this  Option   represents\napproximately  five percent (5%) of the  outstanding  Common Stock assuming full\nexercise of this Option; and\n\n                  C.  There are no  outstanding  options,  warrants,  conversion\nrights or similar  rights under which the Company is or may become  obligated to\nissue or sell any shares of Common Stock,  except (I) as may be  contemplated by\nthis Agreement, and (ii) pursuant to the Purchase Rights Agreement,  dated as of\nDecember 1, 1992, among the Company, E J Financial Investments, L.P., a Delaware\nlimited  partnership  ('EJF'),   and  Sutter  Ambulatory  Care  Corporation,   a\nCalifornia nonprofit public benefit corporation ('SACC'); and\n\n                  D.  The   execution  and  delivery  of  this  Option  and  the\nperformance of the  obligations of the Company have been duly  authorized by all\ncorporate action on behalf of the Company.\n\nARTICLE 2. NO TRANSFER OR ASSIGNMENT OF OPTION.\n\n         Except as  otherwise  provided in this  Agreement,  this Option and the\nrights and  privileges  conferred  hereby  shall not be  transferred,  assigned,\npledged or  hypothecated  in any way,  whether by operation of law or otherwise,\nand shall not be subject to sale under execution, attachment or similar process.\nExcept as otherwise  provided  herein,  upon any transfer,  assignment,  pledge,\nhypothecation or other  disposition of this Option, or of any right or privilege\nconferred  hereby,  contrary  to the  provisions  hereof,  or any sale under any\nexecution,  attachment  or  similar  process  upon  the  rights  and  privileges\nconferred  hereby,  this Option and the rights and privileges  conferred  hereby\nshall immediately become null and void.\n\nARTICLE 3. RIGHT TO EXERCISE.\n\n         3.01. Vesting.  Optionee may only exercise this Option to the extent it\nis vested.  Subject to the  conditions  stated in this  Agreement,  the right to\nexercise this Option shall accrue in installments as follows:\n\n\n                                       -2-\n\n                                                       Percentage of\n                   Date                              Shares Exercisable\n\n        January 1, 1993                          25.0000% (257,998 Shares)\n        February 1, 1993 and the first day of      1.5625% (16,125 Shares)\n        each month thereafter until \n        January 1, 1997\n\n\nless, in the case of each vesting period,  the number of Shares of common stock,\nif any, previously purchased under the Option;  provided,  however, the right to\nexercise  any  unexercised  shares under this Option  shall  immediately  become\nexercisable  in full,  if EJF and SACC,  and  their  respective  affiliates,  as\ndefined in the Stockholders  Agreement,  dated as of December 1, 1992, among the\nCompany,  EJF and SACC (the  'Stockholders  Agreement'),  collectively no longer\nhave the ability to cause the  election of a majority of the Board of  Directors\nof the Company,  through the terms of the Stockholders  Agreement, or otherwise.\nThe Stockholders Agreement is hereby incorporated by reference.\n\n         Any other provision of this Agreement notwithstanding,  if the Optionee\ngoes on a leave of absence in excess of six (6)  months  duration,  other than a\nsick leave or disability  leave (to be determined in the sole  discretion of the\nBoard), then the date when any installment of this Option would otherwise become\nexercisable under the foregoing  schedule shall be delayed for a period equal to\nthe duration of such leave of absence.\n\n         3.02.  Periods of  Nonexercisability.  This Section 3.02 shall  prevail\nover any other  portion of this  Agreement.  The Company shall have the right to\ndesignate  as many as two (2)  periods of time,  each of which  shall not exceed\ntwelve (12) consecutive months in length,  during which this Option shall not be\nexercisable.  The  Company  may only make such a  designation  if it  reasonably\ndetermines that such a limitation on exercise is reasonably likely to facilitate\n(I) a lessening of any restriction on transfer pursuant to the Securities Act or\nany state securities laws on any issuance of securities by the Company, (ii) the\nregistration  or  qualification  of any  securities  by the  Company  under  the\nSecurities  Act or any state  securities  laws,  or (iii) the  perfection of any\nexemption from the registration or qualification  requirements of the Securities\nAct or any applicable  state securities laws for the issuance or transfer of any\nsecurities. This limitation on exercise shall not alter the vesting schedule set\nforth in Section  3.01 other than to limit the periods  during which this Option\nshall be  exercisable.  The Optionee  shall be notified in writing in advance of\nany such designation by the Company.\n\n                                       -3-\n\n\nARTICLE 4.     EXERCISE PROCEDURES.\n\n         4.01. Notice of Exercise.\n\n                  A. The Optionee may exercise  this Option by giving  notice to\nthe Secretary of the Company.  In the notice, the Optionee shall specify (I) the\nelection to exercise  this Option;  (ii) the number of Shares to be issued;  and\n(iii) the form of payment for such Shares.  The Optionee  shall sign the notice.\nThe Optionee shall deliver the notice to the Secretary or Assistant Secretary of\nthe  Company;  and at the time of giving the  notice,  the  Optionee  shall make\npayment  in a form  permissible  under  Article  5 for the  full  amount  of the\nPurchase Price.  The notice shall be in the form attached as Exhibit 4.01.\n\n                  B. A representative of the Optionee may exercise the Option on\nbehalf of the Optionee in accordance  with the procedures of Section  4.01A.  In\naddition to the procedures of Section 4.01A,  the  representative  shall provide\nproof  satisfactory  to the  Company  of  the  representative's  authority  as a\ncondition of the representative's right to exercise this Option.\n\n         4.02.  Issuance of Shares.  After receiving a proper notice of exercise\nand full  payment for the  Shares,  the Company  shall  issue a  certificate  or\ncertificates  for the Shares  subject to the Option  exercised by the  Optionee,\nregistered in the name of the Optionee (or a person set forth in Section 6.04C),\nor,  if so  specified  in the  notice of  option  exercise,  in the names of the\nOptionee and his spouse as community  property or as joint tenants with right of\nsurvivorship.  The Company shall not issue Optionee any fractions of Shares. The\nCompany shall pay the Optionee,  in cash, the Fair Market Value of any fractions\nof Shares. The Company shall deliver any certificates representing the Shares to\nthe Optionee no later than thirty (30) days after  receiving  proper  notice and\nfull payment for the Shares. \n\nARTICLE 5. PAYMENT FOR STOCK.\n\n         The Optionee  shall pay for the entire  Purchase Price in United States\ndollars, or, at the Optionee's discretion:\n\n         The Optionee may elect to surrender  Shares,  in form  appropriate  for\ntransfer,  towards payment of the Purchase Price,  provided that the Company has\nclosed an Initial Public  Offering.  The Shares  surrendered  shall be valued at\ntheir Fair Market Value as of the exercise date. The Optionee may only surrender\nShares if they have an  aggregate  Fair  Market  Value of at least TEN  THOUSAND\nDOLLARS ($10,000).\n\n                                       4-\n\n         The combined  amount paid in cash and the value of  surrendered  Shares\nmust equal the Purchase Price.\n\nARTICLE 6. TERM AND EXPIRATION.\n\n         6.01.  Basic Term.  This Option  shall in any event expire on the tenth\n(10th)  anniversary  of the  Date of  Grant  unless  extended  due to a delay as\ndescribed  in  Section  3.02 with the delay  occurring  after the  eighth  (8th)\nanniversary  of the Date of Grant.  If a delay in  exercising  this  Option  (as\ndescribed in Section 3.02) occurs after the eighth (8th) anniversary of the Date\nof Grant,  the term of this Option  shall be extended by one day for each day of\nsuch delay occurring after the eighth (8th) anniversary of the Date of Grant.\n\n         6.02.  Termination of Service Resulting in Acceleration of Vesting.  If\nthe Optionee's employment is terminated for any of the following reasons:\n\n                  A. The Optionee's death, disability or incapacity;\n\n                  B.  Action by the  Company  pursuant  to  Section  9(d) of the\nEmployment Agreement between the Optionee and the Company, dated the date hereof\n(the 'Employment Agreement'), or otherwise without cause; or\n\n                  C.  Action by the  Optionee  pursuant  to Section  9(e) of the\nEmployment  Agreement,  or otherwise for good reason;  then, any portion of this\nOption  which is not then  exercisable  pursuant  to Section  3.01 shall  become\nexercisable as of the date of  termination  of the Optionee's  employment by the\nCompany (the 'Termination Date').\n\n         6.03.  Termination  of Service  Resulting in  Termination  of Nonvested\n0ptions.  If the  Optionee's  employment is terminated for any reason other than\nset forth in Section 6.02  herein,  then any portion of this Option which is not\nthen  exercisable  pursuant  to  Section  3.01  herein  shall  terminate  on the\nTermination Date. 6.04. Exercise of Options After Termination Date.\n\n                  A. After the  Termination  Date, the Optionee may exercise any\nportion of this Option (other than any portion which has terminated  pursuant to\nSection 6.03 hereof) on or before the ninetieth  (90th) day after the end of the\ncalendar year in which the Termination Date occurs.\n\n                  B. After the time period set forth in Section 6.04.A above has\nexpired, the Optionee shall no longer have any rights whatsoever hereunder.\n\n                  C. All or part of this  Option  may be  exercised  at any time\nbefore its  expiration  by the  executors or  administrators  of the  Optionee's\nestate or by\n\n                                       -5-\n\nany person who has acquired  this Option  directly from the Optionee by bequest,\nbeneficiary designation or inheritance.\n\n         6.05. Leaves of Absence. For purposes of this Article 6, the employment\nrelationship  shall be deemed to continue during any period when the Optionee is\non  military  leave,  sick  leave or other  bona fide  leave of  absence  (to be\ndetermined in the sole discretion of the Board).\n\nARTICLE 7. LEGALITY OF INITIAL ISSUANCE.\n\n         Shares  shall be issued  upon the  exercise  of this Option only if the\nCompany  has  determined  that (I) it and the  Optionee  have taken any  actions\nrequired by law to register the Shares under the Securities Act or to perfect an\nexemption  from the  registration  requirements  thereof;  (ii)  any  applicable\nlisting  requirement  of any stock  exchange or automated  quotations  system on\nwhich the Shares are listed has been satisfied;  and (iii) any other  applicable\nprovision of state or federal securities law has been satisfied.\n\nARTICLE 8. REGISTRATION RIGHTS.\n\n         8.01.  Form S-8  Registration.  From and after (I) the completion of an\nInitial Public  Offering and (ii) the expiration of any lock-up period set forth\nin the Company's  underwriting  agreement with the managing underwriters) of the\nCompany's Initial Public Offering, the Company shall register the Shares on Form\nS-8 for sale pursuant to employee  benefit plans of the Company;  provided that,\n(x) the optionee has given the Company at least sixty (60) days' written  notice\nof  Optionee's  request to register the Shares and (y) the  registration  of the\nShares is permitted by the rules of the Securities and Exchange Commission.\n\n         8.02. No Other Registration  Rights. Other than as set forth in Section\n8.01 above,  the Company may, but shall not be obligated to, register or qualify\nthe  resale of  Shares by the  Optionee  under the  Securities  Act or any other\napplicable  law.  The Company  shall not be  obligated  to take any  affirmative\naction in order to cause such a resale of Shares to comply with any law.\n\nARTICLE 9. RESTRICTIONS ON TRANSFER OF SHARES.\n\n         9.01.  Restrictions.  Regardless  of whether the  offering  and sale of\nShares have been registered  under the Securities Act or have been registered or\nqualifiedunder  the  securities  laws  of any  state,  the  Company  may  impose\nrestrictions  upon the sale,  pledge or other transfer of such Shares (including\nthe placement of\n\n                                       -6-\n\nappropriate legends on stock certificates) if, in the reasonable judgment of the\nCompany and its counsel,  such  restrictions are necessary or desirable in order\nto achieve  compliance with the Securities Act, the securities laws of any state\nor any other law or with restrictions imposed by the Company's underwriters.\n\n         9.02.  Investment  Intent at Grant. The Optionee  represents and agrees\nthat the Shares to be acquired upon  exercising this Option will be acquired for\ninvestment and not with a view to the sale or distribution thereof.\n\n         9.03.  Investment  Intent at  Exercise.  If the sale of Shares  are not\nregistered  under the  Securities  Act,  but an  exemption  is  available  which\nrequires an  investment  representation  or other  representation,  the Optionee\nshall represent and agree at the time of exercise that the Shares being acquired\nupon exercising  this Option are being acquired for  investment,  and not with a\nview  to  the  sale  or  distribution   thereof,   and  shall  make  such  other\nrepresentations  as are deemed  necessary or  appropriate by the Company and its\ncounsel.\n\n         9.04.  Stockholders  Agreement.  Unless an Initial Public  Offering has\nbeen completed,  the Optionee shall,  upon exercise of any Options,  execute and\ndeliver  instruments  necessary  to cause the  Optionee to become a party to the\nStockholders Agreement.  Such instrument shall obligate the Optionee to vote his\nShares for the director nominees nominated by SACC or EJF.\n\n         9.05.  Legend.  All certificates  evidencing Shares acquired under this\nAgreement in an unregistered  transaction  shall bear the following  restrictive\nlegends (and such other restrictive  legends as are required or deemed advisable\nunder the provisions of any applicable law):\n\n                  A. THE  SHARES  REPRESENTED  HEREBY  HAVE NOT BEEN  REGISTERED\nUNDER THE  SECURITIES ACT OF 1933, AS AMENDED,  AND MAY NOT BE SOLD,  PLEDGED OR\nOTHERWISE  TRANSFERRED WITHOUT AN EFFECTIVE  REGISTRATION THEREOF UNDER SUCH ACT\nOR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH\nREGISTRATION  IS NOT REQUIRED;  and \n\n                  B. Any legend required by the Stockholders Agreement.\n\n         9.06. Removal of Legends.  If, in the reasonable opinion of the Company\nand its counsel,  any legend placed on a stock certificate  representing  Shares\nsold under this Agreement is no longer required,  the holder of such certificate\nshall be entitled to exchange such  certificate  for a certificate  representing\nthe same number of Shares but lacking such legend.\n\n                                       -7-\n\n\nARTICLE 10. SHARES AND ADJUSTMENTS.\n\n         10.01.  General. If there is a subdivision of the outstanding Shares, a\ndeclaration of a dividend payable in Shares, a declaration of a dividend payable\nin a form other than Shares in an amount that has a material effect on the value\nof  Shares,  a  combination  or  consolidation  of the  outstanding  Shares  (by\nreclassification   or   otherwise)   into  a  lesser   number   of   Shares,   a\nrecapitalization or a similar  occurrence,  the Board shall make all appropriate\nadjustments  in both (I) the number of Shares  covered by this Option;  and (ii)\nthe Exercise Price.\n\n         10.02. Merger; Consolidation;  Sale; Liquidation. If the Company is (I)\na party  to a merger  or  consolidation  and the  Company  is not the  surviving\ncorporation,  (ii)  if  there  is a  sale  of all  or  substantially  all of the\nCompany's  assets  other than a sale or  transfer to a  Subsidiary,  or (iii) if\nthere is a dissolution or liquidation of the Company (each referred to herein as\na 'Trigger  Event'),  the Optionee shall,  upon a Trigger Event,  have the right\n(immediately  prior to the Trigger Event) to exercise this Option in whole or in\npart  without  regard to the vesting  schedule  set forth in Section  3.01.  The\nOption shall  terminate  after the Trigger  Event has taken  place.  The Company\nshall  exercise its best efforts to keep Optionee  informed in advance of when a\nTrigger Event may or will occur.\n\n         10.03. Reservation of Rights. Except as provided in Articles 10 and 11,\nthe  Optionee  shall  have  no  rights  by  reason  of (I)  any  subdivision  or\nconsolidation of shares of stock of any class; (ii) the payment of any dividend;\nor (iii) any other  increase or decrease in the number of shares of stock of any\nclass.  Any issue by the Company of shares of stock of any class,  or securities\nconvertible  into  shares  of stock  of any  class,  shall  not  affect,  and no\nadjustment  by reason  thereof  shall be made with  respect  to,  the  number or\nExercise  Price of the Shares  subject to this Option.  The grant of this Option\nshall  not  affect  in any  way  the  right  or  power  of the  Company  to make\nadjustments,  reclassifications,  reorganizations  or changes of its  capital or\nbusiness structure, to merge or consolidate or to dissolve,  liquidate,  sell or\ntransfer  all or any  part of its  business  or  assets.  \n\nARTICLE  11.  OPTIONEE PURCHASE RIGHTS.\n\n         If, at any  time,  or from time to time,  prior to the  Initial  Public\nOffering, the Company issues or sells any shares of its common stock (other than\nshares issued to employees or directors  pursuant to employee  benefit plans and\nshares issued in stock splits or  dividends),  the Company  agrees to notify the\nOptionee in writing of the terms of the issuance.  The Optionee shall  thereupon\nbe entitled to purchase\n\n                                      -8-\n\nfrom the Company a number of shares of common stock of the Company such that the\nOptionee  owns the same  percentage  of common  stock of the  Company  after the\nissuance as before the issuance.  The Optionee's  percentage  ownership shall be\ncalculated  assuming full exercise of this Option.  The Optionee  shall exercise\nhis purchase  rights under this Article 11 within  thirty (30) days from receipt\nof  notification  from the  Company.  The  Optionee  shall  purchase  any shares\nacquired  under  this  Article  11 on the same  terms  and  conditions  as those\nprovided to the other investors in such offering.\n\nARTICLE 12. MISCELLANEOUS PROVISIONS.\n\n         12.01. Withholding Taxes. If the Company determines that it is required\nto withhold foreign,  federal, state or local tax as a result of the exercise of\nthis Option, the Optionee,  as a condition to the exercise of this Option, shall\nmake  arrangements  satisfactory to the Company to enable the Company to satisfy\nall withholding requirements.\n\n         12.02. Rights as a Stockholder.  The Optionee shall not have any rights\nas a  stockholder  with respect to any Shares  subject to this Option until such\nShares have been issued as provided in Section 4.02.\n\n         12.03.  No  Employment  Rights.  Nothing  in this  Agreement  shall  be\nconstrued as giving the Optionee the right to continue as an Employee. The terms\nof the  Optionee's  employment  with the Company are set forth in the Employment\nAgreement. The Company reserves the right to terminate the Optionee's employment\nat any time, with or without cause,  subject to any written Employment Agreement\nbetween the Optionee and the Company to the contrary.\n\n         12.04. Notice. Any notice required by the terms of this Agreement shall\nbe given in writing and shall be deemed effective upon personal  delivery or two\n(2) days after the date of deposit with the United  States  Postal  Service,  by\nregistered or certified  mail with postage and fees prepaid and addressed to the\nparty entitled to such notice at the address shown below such party's  signature\non this  Agreement,  or at such other address as such party may designate by ten\n(10) days' advance written notice to the other party to this Agreement.\n\n         12.05. Entire Agreement. This Agreement constitutes the entire contract\nbetween the parties hereto with regard to the subject matter hereof.\n\n         12.06.  Choice  of Law.  This  Agreement  shall  be  governed  by,  and\nconstrued in accordance  with,  the laws of the State of Delaware  (exclusive of\nits laws\n\n                                       -9-\n\nregarding the conflict of laws),  as such laws are applied to contracts  entered\ninto and performed in such state.\n\n         12.07. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. THE OPTIONEE AND\nTHE COMPANY  HEREBY  CONSENT TO THE  JURISDICTION  OF ANY STATE OR FEDERAL COURT\nLOCATED WITHIN THE COUNTY OF THE COMPANY'S  HEADQUARTERS (AT THE TIME ANY ACTION\nIS INSTITUTED), AND IRREVOCABLY AGREE THAT, UNLESS BOTH PARTIES ELECT OTHERWISE,\nALL ACTIONS OR PROCEEDINGS  RELATED TO THIS AGREEMENT SHALL BE LITIGATED IN SUCH\nCOURTS.  THE PARTIES ACCEPT THE EXCLUSIVE  JURISDICTION OF SUCH COURTS AND WAIVE\nANY DEFENSE OF FORUM NON CONVENIENS,  AND  IRREVOCABLY  AGREE TO BE BOUND BY ANY\nJUDGMENT  RENDERED  THEREBY IN CONNECTION  WITH THIS  AGREEMENT.  SERVICE OF ALL\nPROCESS IN ANY SUCH  PROCEEDINGS  IN ANY SUCH COURT MAY BE MADE BY MAILING IT BY\nREGISTERED  OR  CERTIFIED  MAIL TO THE  PARTIES AT THE  ADDRESS  PROVIDED ON THE\nSIGNATURE PAGE HEREIN,  SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY THE PARTIES TO\nBE EFFECTIVE AND BINDING  SERVICE IN EVERY RESPECT.  NOTHING HEREIN SHALL EFFECT\nTHE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.\n\nARTICLE 13. DEFINITIONS.\n\n         13.01.  Board.  Shall mean the Board of Directors  of the  Company,  as\nconstituted from time to time.\n\n         13.02. Code. Shall mean the Internal Revenue Code of 1986, as amended.\n\n         13.03.  Date of Grant.  Shall mean the date on which the Board resolved\nto grant  this  Option,  which is also the date as of which  this  Agreement  is\nentered into.\n\n         13.04. Employee. Shall mean any individual who is a common law employee\nof the Company or of a Subsidiary.\n\n         13.05.  Exercise  Price.  Shall mean the amount for which one (1) Share\nmay be purchased upon exercise of this Option as specified in Section 1.01.\n\n         13.06 Fair Market Value.  Shall mean as of the date of this  Agreement,\nONE DOLLAR ($1.00) per share.  After the date of this  Agreement,  it shall mean\nfor each share:  (I) the  average of the closing  prices per share of the common\nstock as reported in The Wall Street  Journal for the last twenty (20)  business\ndays prior to the\n\n                                      -10-\n\nexercise  date if shares of the  Common  Stock are  either  listed on a national\nsecurities  exchange or traded on the  NASDAQ\/National  Market System;  (ii) the\naverage bid and asked prices for the last twenty (20) business days prior to the\nexercise  date as furnished by two (2) members of the  National  Association  of\nSecurities  Dealers,  Inc.,  selected  for that purpose from time to time by the\nCompany and reasonably  acceptable to the Optionee if shares of the Common stock\nare not so listed,  admitted or traded;  or (iii) the price determined below, if\nthe formulas set forth in clauses (I) and (ii) above are inapplicable:\n\n         The price, as of the exercise date  determined by an investment  banker\nselected by the mutual  agreement of the Company and the Optionee (the 'Mutually\nAcceptable  Investment Banker').  If the parties are unable to select a Mutually\nAcceptable Investment Banker, the price shall be determined,  as of the exercise\ndate, by a single  arbitrator  selected in accordance with the provisions of the\nAmerican  Arbitration  Association  located in Chicago.  To the extent possible,\nthis  arbitrator  shall  have at least  ten  (10)  years  of  experience  in the\ninvestment banking industry and shall be familiar with valuing companies engaged\nin the surgery center business.\n\n         13.07.  Initial Public Offering.  Initial Public Offering shall mean an\ninitial public primary  offering by  underwriters  on a firm  commitment or best\nefforts  basis in which the  Common  Stock is listed  on a  national  securities\nexchange or traded on the Automated Quotation System of the National Association\nof Securities Dealers or other over-the-counter- market.\n\n         13.08.  Option.  Shall mean an employee  stock option not  described in\nsections 422(b) or 423(b) of the Code granted under this Agreement and entitling\nthe Optionee to purchase Shares.\n\n         13.09.  Purchase Price. Shall mean the Exercise Price multiplied by the\nnumber of Shares with  respect to which this Option is being  exercised. \n\n         13.10.  Securities  Act.  Shall  mean the  Securities  Act of 1933,  as\namended.\n\n         13.11.  Share. Shall mean one (1) share of Common Stock, as adjusted in\naccordance with Article 10 (if applicable).\n\n         13.12.  Subsidiary.  Shall mean any corporation,  if the Company or one\n(1) or more other Subsidiaries own, individually or collectively,  not less than\nfifty  percent  (50%) of the  total  combined  voting  power of all  classes  of\noutstanding stock of such corporation.\n\n\n                                      -11-\n\n         IN WITNESS  WHEREOF,  the  Company  has  caused  this  Agreement  to be\nexecuted on its behalf by its officer  duly  authorized,  and the  Optionee  has\npersonally executed this Agreement.\n\n                                    OPTIONEE:\n\n\n\n\n\n                                          ---------------------------------\n                                                 AUGUST A. SAIBENI\n                                          Address:\n                                                  -------------------------\n                                                  -------------------------\n\n                                    COMPANY:\n\n                                          SUTTER SURGERY CENTERS, INC., a\n                                          Delaware corporation\n\n\n                                          By\n                                            --------------------------------\n                                          Its\n                                             -------------------------------\n                                          Address:     2800 L Street\n                                                       Sacramento, CA  95816\n\n\n                                  EXHIBIT 4.01\n\n                              OPTION EXERCISE FORM\n\n                                                        Date:_________________\n\n                            NONQUALIFIED STOCK OPTION\n\n                                  EXERCISE FORM\n\nSutter Surgery Centers, Inc.\nAttention: Secretary\n\n- ----------------------------\n- ----------------------------\n\n\n         The undersigned  elects to exercise the option to purchase  ___________\n(________)  shares of common  stock (the  'Shares') of Sutter  Surgery  Centers,\nInc.,  ('Company'),  in accordance with the nonqualified stock option granted to\nthe undersigned by Company as of , 1992, pursuant to a Nonqualified Stock Option\nPlan and Agreement (the 'Agreement').\n\n         Prior to the issuance of these Shares,  I will make full payment of the\nPurchase Price for the Shares by one of the following methods as indicated:\n\n         [ ]      In cash in the amount of\n\n         [ ]      By tender of Shares of the Company  having a Fair Market Value\n                  when combined with other forms of payment of not less than the\n                  Purchase Price (shares may only be tendered if the Company has\n                  completed  an  Initial  Public  Offering  (as  defined  in the\n                  Agreement)).\n\n         Please  issue the  Shares to  ___________________________________[i.e.,\nOptionee;  Optionee and spouse as community property;  or Optionee and spouse as\njoint tenants]. .\n\n         I represent and agree that I am over eighteen (18) years of age, that I\nam acquiring the Shares for investment  and that I have no present  intention to\ntransfer, sell or otherwise dispose of such Shares, except as permitted pursuant\nto the Agreement and in compliance with applicable securities laws.\n\n\n         I further  acknowledge  and  understand  that the  Shares  must be held\nindefinitely unless they are subsequently registered under the Securities Act or\nan exemption from such  registration  is available.  I further  acknowledge  and\nunderstand that,  except as set forth in the Agreement,  the Company is under no\nobligation to register the Shares and that, in the absence of registration,  the\nShares may not be transferred.  I understand that the instrument  evidencing the\nShares will be imprinted  with legends which prohibit the transfer of the Shares\nunless they are registered or such  registration  is not required in the opinion\nof counsel  satisfactory  to Company.  I do not have any contract,  agreement or\narrangement with any persons to sell,  transfer or grant  participations to such\nperson or to any third person with respect to any of the Shares.\n\n         I am aware of the adoption of Rule 144 by the  Securities  and Exchange\nCommission,  promulgated  under the Securities Act, which permits limited public\nresale  of  securities   acquired  on  a  nonpublic   offering  subject  to  the\nsatisfaction  of  certain  conditions,   including,   among  other  things:  The\navailability of certain public  information about Company,  the resale occurring\nnot less than two (2) years  after  the  party  has  purchased  and paid for the\nsecurities  to be sold,  the sale  being  through  a  broker  in an  unsolicited\n'broker's transaction,' and the amount of securities being sold during any three\n(3)-month period not exceeding  specified  limitations  (generally,  one percent\n(1%) of the total amount outstanding).\n\n         I agree to  obtain  the  consent  of my spouse  to this  exercise.* \n\n         My address of record is:\n\n                      -------------------------------------\n                      -------------------------------------\nand my Social Security number is:\n                                  -------------------------------------\n\n                                       Very truly yours,\n\n\n\n                                       -------------------------------------\n                                       Name:\n\n\n- ------------------------------\n* The Consent of Spouse should be in the form attached to the Nonqualified Stock\nOption Exercise Form.\n\n                                       -2-\n\n \n\n                                CONSENT OF SPOUSE\n\n\n\n\n         The  undersigned,  being  the  spouse of  ______________________,  does\nhereby  acknowledge that she has read and is familiar with the provisions of the\nabove Nonqualified Stock Option Exercise Form and the Agreement,  and she hereby\nagrees  thereto and joins therein to the extent,  if any, that her agreement and\njoinder may be necessary.\n\n           DATED:\n                 ---------------------------\n\n\n                                      -------------------------------------\n                                                  (Signature)\n\n                                      Print Name:\n                                                 --------------------------\n\nReceipt of the above is hereby\nacknowledged:\nSUTTER SURGERY CENTERS, INC.\n\n\nBy\n   -------------------------------\nIts\n   -------------------------------\nDated:\n      -------------------------------\n\n\n\n                                      -3-\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7751],"corporate_contracts_industries":[9438],"corporate_contracts_types":[9539,9544],"class_list":["post-40172","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-healthsouth-corp","corporate_contracts_industries-health__misc","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40172"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40172"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40172"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}