Chief Compliance Officer Employment Agreement - Christopher J. Riopelle

Exhibit 10.2


EMPLOYMENT AGREEMENT

This Employment Agreement (this " Agreement" ) is entered into effective November 2, 2005 (the " Effective Date" ), by and between DaVita Inc. (" Employer" ) and Christopher J. Riopelle (" Employee" ).


In consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the parties hereto, intending to be legally bound hereby, agree as follows:

Section 1. Employment and Duties . Employer hereby employs Employee to serve as Chief Compliance Officer. Employee accepts such employment on the terms and conditions set forth in this Agreement. Employee shall perform the duties of Chief Compliance Officer and any additional or different duties as the Company deems appropriate. Employee shall report to both Kent Thiry and Dennis Kogod, or any other person as designated by the Chief Executive Officer. Employee agrees to devote substantially all of his time, energy, and ability to the business of Employer on a full-time basis and shall not engage in any other business activities during the term of this Agreement, provided however , Employee may pursue normal charitable activities so long as such activities do not require a substantial amount of time and do not interfere with his ability to perform his duties. Employee agrees that he shall not serve on the board of directors of any not-for-profit or for-profit company without the express written approval of the Chief Executive Officer or the Board of Directors. Employee shall at all times observe and abide by the Employer' s policies and procedures as in effect from time to time.


Section 2. Compensation . In consideration of the services to be performed by Employee hereunder, Employee shall receive the following compensation and benefits:


2.1 Base Salary . Employer shall pay Employee a base salary of $225,000 per annum, less standard withholdings and authorized deductions. Employee shall be paid consistent with Employer' s payroll schedule. The base salary will be reviewed each year during Employer' s annual review. Employer, in its sole discretion, may increase the base salary as a result of any such review.

2.2 Benefits . Employee and/or his family, as the case may be, shall be eligible for participation in and shall receive all benefits under Employer' s health and welfare benefit plans (including, without limitation, medical, prescription, dental, disability, and life insurance) under the same terms and conditions applicable to most executives at similar levels of compensation and responsibility.


2.3 Performance Bonus .


(a) For the 2005 year, payable in March 2006, Employee shall be eligible to receive a discretionary performance bonus (the " Bonus" ) between zero and 60 percent of Employee' s base salary. Thereafter, Employee shall be eligible to receive a Bonus between

zero and $135,000, less standard deductions and authorized withholdings. All Bonuses are payable in a manner consistent with Employer' s practices and procedures. The amount of the Bonus, if any, will be decided by the Chief Executive Officer and/or the Board of Directors or the Compensation Committee of the Board in his/its sole discretion.

(b) Employee must be employed by Employer (or an affiliate) on the date any Bonus is paid to be eligible to receive such Bonus and, if Employee is not employed by Employer (or an affiliate) on the date any Bonus is paid for any reason whatsoever, Employee shall not be entitled to receive such Bonus.


2.4 Vacation . Employee shall have vacation, subject to the approval of Dennis Kogod, Kent Thiry, Joe Mello, or Tom Kelly.

2.5 Stock Options . Employee shall receive options to purchase 25,000 shares of Employer stock. Such options shall have a five-year term and vest 25% on the first anniversary date of the grant, 8.33% on the 20 th month of the grant, and 8.33% every 4 months thereafter. The exercise price shall be the closing price as reported on the New York Stock Exchange on the Effective Date of this Agreement or on the date that appropriate approval has been given, whichever is later. The options will be reflected in a separate Stock Option Agreement.


2.6 Restricted Stock Units . On the Effective Date or on the date appropriate approval has been given, whichever date is later, Employee will receive 2,500 shares of Employer' s restricted stock units, entitling Employee to the same number of full shares of DaVita common stock, subject to the following vesting conditions: such restricted stock units shall vest over a three-year period, one-third vesting on the third, fourth, and fifth anniversary date of the grant date. The terms of the restricted stock units will be reflected in a separate Restricted Stock Units Agreement.

2.7 Indemnification . Employer agrees to indemnify Employee against and in respect of any and all claims, actions, or demands, to the extent permitted by the Company' s By-laws and applicable law. Employer shall present Employee with a separate Indemnification Agreement.

2.8 Reimbursement . Employer also agrees to reimburse Employee in accordance with Employer' s reimbursement policies for travel and entertainment expenses, as well as other business-related expenses, incurred in the performance of his duties hereunder.

2.9 Changes to Benefit Plans . Employer reserves the right to modify, suspend, or discontinue any and all of its health and welfare benefit plans, practices, policies, and programs at any time without recourse by Employee so long as such action is taken generally with respect to all other similarly-situated peer executives and does not single out Employee.

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Section 3. Provisions Relating to Termination of Employment .

3.1 Employment Is At-Will . Employee' s employment with Employer is " at will" and is terminable by Employer or by Employee at any time and for any reason or no reason, subject to the notice requirements set forth below.


3.2 Termination for Material Cause . Employer may terminate Employee' s employment for Material Cause (as defined below). Upon termination for Material Cause, Employee shall (i) be entitled to receive the Base Salary and benefits as set forth in Section 2.1 and Section 2.2 , respectively, through the effective date of such termination and (ii) not be entitled to receive any other compensation, benefits, or payments of any kind, except as otherwise required by law or by the terms of any benefit or retirement plan or other arrangement that would, by its terms, apply.


3.3 Other Termination . Employer may terminate the employment of Employee for any reason or for no reason at any time upon at least thirty (30) days' advance written notice. If Employer terminates the employment of Employee for reasons other than for death, Material Cause, or Disability, and contingent upon Employee' s execution of the Employer' s standard Severance and General Release Agreement, Employee shall (i) be entitled to receive the base salary and benefits as set forth in Section 2.1 and Section 2.2 , respectively, through the effective date of such termination or resignation, (ii) be entitled to continue to receive an amount equal to his base salary for the twelve (12)-month period following the termination of his employment (the " Severance Period" ), paid in accordance with the the Employer' s usual payroll practices, (iii) be entitled to continue to receive during the twelver (12)-month period following the effective date of such termination the employee health insurance benefits set forth in Section 2.2 , pursuant to the election of COBRA coverage, at the same cost to him as he paid prior to his termination, and (iv) not be entitled to receive any other compensation, benefits, or payments of any kind, except as otherwise required by law or by the terms of any benefit or retirement plan or other arrangement that would, by its terms, apply. The foregoing notwithstanding, in the event Employee accepts employment (as an employee or as an independent contractor) with another employer during the Severance Period, (x) Employee shall immediately notify Employer of such employment and (y) Employer' s obligation to continue to provide certain health insurance benefits pursuant to clause (iii) of the immediately preceding sentence shall terminate once Employee becomes eligible to participate in his new employer' s health benefit plan. In addition, once Employee accepts employment (as an employee or as an independent contractor), Employer may reduce its obligation under clause (ii) herein dollar-for-dollar for every dollar Employee earns in base salary or other compensation during the Severance Period from his new employer. Employee shall not defer compensation or engage in any other conduct to get around this Agreement. Employee agrees to use reasonable efforts to find employment and that if he fails to use reasonable efforts, the Company' s obligations under clause (ii) herein may be terminated by Employer in its sole discretion.

During the Severance Period, Employee agrees (1) to make himself available to answer questions and to cooperate in the transition of his duties, (2) to respond to any inquiries from the compliance department, including making himself available for interviews, and (3) to cooperate


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with Employer in the prosecution and/or defense of any claim, including making himself available for any interviews, appearing at depositions, and producing requested documents.


3.4. Voluntary Resignation . Employee may resign from Employer at any time upon at least ninety (90) days' advance written notice. If Employee resigns from Employer, other than as a res ...