EX-10.3 FORM OF NONQUALIFIED STOCK OPTION AGMNT



 







Exhibit 10.3




Symbion Non-Employee Directors Stock Option Plan

Nonqualified Stock Option Agreement




Grant Number _________




     This Agreement is made and entered into on this ___day of ___, ___, by and
between Symbion, Inc. (the “Company”) and ___ (the “Participant”), in connection with the
grant of an Option under the Symbion Non-Employee Directors Stock Option Plan (the “Plan”) that was
made on ___, ___.



     The Company established the Plan by action of its board of directors and thereafter approved
by the stockholders of the Company effective on March 28, 2002. The Participant is a non-employee
director of the Company and is eligible to receive this Option under the terms of the Plan. The
Company desires to encourage the Participant to own Stock for the purposes stated in Article II of
the Plan. In consideration of the foregoing, the parties have entered into this Agreement to
govern the terms of the Option granted by the Company pursuant to the authority specified under the
Plan:



     1. Grant of Option. Subject to the terms and conditions set forth herein, the Company
has granted to the Participant an Option to purchase from the Company
___ shares of Stock at a
price of $  per share. This price and the number of shares are subject to adjustment as
provided in Article VIII of the Plan. This Option expires at the close of business on ___,
___, unless it expires sooner pursuant to Paragraph 6. Except as otherwise provided in
Paragraph 6 or in the Plan, this Option is exercisable at any time prior to the date it expires
with respect to the number of shares of Stock shown in the schedule below.



	 	 	 
	On and After	 	Shares Subject to Exercise
	[Date]
	 	___Shares

	[Date]
	 	An additional ___Shares

	[Date]
	 	An additional ___Shares







     2. Method of Exercise. The exercise of this Option is subject to the Participant’s
execution of a written stockholders agreement that generally applies to some or all of the
stockholders of the Company, payment of the exercise price stated in Paragraph 1, and making
arrangement for any required tax withholdings in a method that is acceptable to the Company or the
Committee. The Participant may exercise this Option in whole or in part, from time to time, with
respect to the number of whole shares of Stock that can be purchased at such time in accordance
with Paragraph 1, by actual delivery of written notice to the Company at the address provided in
Paragraph 10. Such notice of exercise shall:



          (a) specify the number of whole shares of Stock to be purchased, the exercise price and, if
applicable, the portion of the Option that is being exercised;



          (b) contain evidence satisfactory to the Committee that the person exercising this Option is
the Participant or has the right to exercise this Option; and



 









 





          (c) be accompanied by payment of the exercise price in accordance with the Plan and, in a
manner that is acceptable to the Company or the Committee, payment of or arrangement for the
payment of any required federal, state, and local withholding taxes that are due in connection with
the exercise.



     3. Transfer and Exercise of Option. In general, this Option is not transferable and
the Participant may not make any disposition of this Option or any interest herein during his or
her lifetime, except for transfers pursuant to a will or the laws of descent and distribution;
provided, however, that the Option may be transferred to the extent consented to by the Committee.
As used herein, “disposition” means any sale, transfer, encumbrance, gift, donation, assignment,
pledge, hypothecation, or other disposition, whether similar or dissimilar to those previously
enumerated, whether voluntary or involuntary, and whether during the Participant’s lifetime or upon
or after the Participant’s death, including, but not limited to, any disposition by operation of
law, by court order, by judicial process, or by foreclosure, levy or attachment, except a transfer
by will or by the laws of descent or distribution. Any attempted disposition in violation of this
Paragraph is void.



     4. Status of Participant. The Participant shall not be deemed a stockholder of the
Company with respect to any of the shares of Stock subject to this Option, except to the extent
that such shares shall have been purchased and transferred to him or her. The Company is not
required to issue shares of Stock purchased upon exercise of this Option until all applicable
requirements of law have been complied with and such shares shall have been duly listed on any
securities exchange or market system on which the Stock may then be traded.



     5. No Effect On Capital Structure. This Option shall not affect the right of the
Company or any Affiliate to reclassify, recapitalize or otherwise change its capital or debt
structure or to merge, consolidate, convey any or all of its assets, dissolve, liquidate, windup,
or otherwise reorganize.



     6. Expiration of Option. In general, the right to purchase Stock under this Option
shall expire on the date specified in Paragraph 1, which is seven years from the date this Option
was granted. However, this Option shall expire on the soonest of any of the following circumstances
to occur.



          (a) Fraud or Dishonesty. If the directorship of the Participant is terminated on account of
fraud, dishonesty or other acts detrimental to the interests of the Company or any direct or
indirect majority-owned subsidiary of the Company, the Option shall automatically terminate as of
the date of such termination.



          (b) Disability. If the directorship of the Participant is terminated due to the Participant’s
disability (as defined in section 22(e)(3) of the Code), the Participant may exercise this Option
for 12 months after such termination, but only to the extent the Participant was able to do so
under Paragraph 1 on the date of termination of the directorship. Thereafter, this Option shall
terminate and cease to be exercisable.



          (c) Death. If the Participant dies, this Option shall be fully exercisable by the
Participant’s legal representatives, heirs, legatees, or distributees for 12 months after death if
the



 









 




Participant was entitled to exercise it on the date of death, without regard to the schedule
in Paragraph 1. Thereafter, this Option shall terminate and cease to be exercisable.




          (d) Other Termination of Directorship. If the directorship of the Participant terminates for
any reason other than the circumstances described in subparagraphs (a), (b), or (c) above, the
Participant may exercise this Option for three months after such termination, but only to the
extent the Participant was able to do so under Paragraph 1 on the date of termination of the
directorship. Thereafter, this Option shall terminate and cease to be exercisable. Notwithstanding
the foregoing, if the Participant becomes an employee of the Company or an Affiliate upon the
termination of his directorship, the Participant may exercise this Option for 12 months after such
termination to the extent provided under Paragraph 1 on the date of exercise. Thereafter, this
Option shall terminate and cease to be exercisable.



     7. Committee Authority. Any question concerning the interpretation of this Agreement,
any adjustments required to be made under the Plan and any controversy that may arise under the
Plan or this Agreement shall be determined by the Committee in its sole discretion. Such decision
by the Committee shall be final and binding.



     8. Change in Control. Upon the occurrence of a Change in Control, as defined in the
Plan, this Option shall be subject to the following:



          (a) If this Option is outstanding immediately prior to the Change in Control and, as a result
of the Change in Control, the Company is not the surviving entity after the transaction, or
survives only as a subsidiary or is otherwise controlled by another entity, this Option shall be
assumed by the entity which is the survivor of the transaction, or converted into options to
purchase the common stock of the surviving entity, in a transaction to which section 424(a) of the
Code applies.



          (b) Notwithstanding the provisions of Section 8.3 of the Plan regarding the acceleration of
the right to exercise this Option upon a Change in Control, a portion of the acceleration of
vesting described in this Section shall not occur with respect to this Option to the extent such
acceleration of vesting would cause the Participant or holder of such Option to realize less
income, net of taxes, after deducting the amount of excise taxes that would be imposed pursuant to
section 4999 of the Code, than if accelerated vesting of that portion of the Option did not occur.
This limitation shall not apply to the extent that the stockholders of the Company or the acquirer
approve the acceleration of vesting hereunder in a manner that satisfies section 280G(b)(5)(B) of
the Code, or to the extent that the Participant is a party to an agreement in which the Participant
is fully indemnified or otherwise held harmless for the taxes that result from section 4999 of the
Code.



          (c) Except as modified by this Paragraph 8, the provisions of Section 8.3 shall otherwise
apply to this Option upon the occurrence of a Change in Control.



     9. Plan Controls. The terms of this Agreement are governed by the terms of the Plan,
as it exists on the date of this Agreement and as the Plan is amended from time to time. A copy of
the Plan, and any amendments thereto, has been delivered or made available to the Participant and
shall be deemed to be a part of this Agreement as if fully set forth herein. In the event of any



 









 




conflict between the provisions of the Agreement and the provisions of the Plan, the terms of
the Plan shall control, except as expressly stated otherwise. For purposes of this Agreement, the
defined terms in the Plan shall have the same meaning in this Agreement, except where the context
otherwise requires. The terms “Article” or “Section” generally refer to provisions within the Plan;
provided, however, the term “Paragraph” shall refer to a provision of this Agreement.




     10. Notice. Whenever any notice is required or permitted hereunder, such notice must
be in writing and personally delivered or sent by mail. Any notice required or permitted to be
delivered hereunder shall be deemed to be delivered on the date that it is personally delivered,
or, whether actually received or not, on the third business day after it is deposited in the United
States mail, certified or registered, postage prepaid, addressed to the person who is to receive it
at the address that such person has theretofore specified by written notice delivered in accordance
herewith. The Company or Participant may change, by written notice to the other, the address
previously specified for receiving notices. Notices delivered to the Company shall be addressed as
follows:



Symbion, Inc.

Attn: __________________

40 Burton Hills Blvd., Suite 500

Nashville, TN 37215

Phone: (615) 234-5900

Fax: (615) 234-5998



Notices to the Participant shall be hand delivered to the Participant on the premises of the
Company or its Affiliates, or mailed to the last address shown on the records of the Company.




     11. Information Confidential. As partial consideration for granting of this Option,
the Participant agrees that he or she will keep confidential all information and knowledge that the
Participant has relating to the manner and amount of his or her participation in the Plan;
provided, however, that such information may be disclosed as required by law and may be given in
confidence to the Participant’s spouse, tax and financial advisors, or to a financial institution
to the extent that such information is necessary to secure a loan.



     12. Governing Law. Except as is otherwise provided in the Plan, where applicable, the
provisions of this Agreement shall be governed by the internal laws of the State of Tennessee,
without regard to the principles of conflicts of laws thereof.



 









 





Execution Page




     In Witness Whereof, the Company has caused this Agreement to be executed and the
Participant has set his hand hereto, to be effective as of _______________.



	 	 	 	 	 
	 	

Symbion, Inc.

 	 
	 	
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 



	 	 	 	 	 
	 	Participant