Exhibit 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (this " Agreement" ) is entered into effective February 13, 2008 (the " Effective Date" ), by and between DaVita Inc., on behalf of itself and each of its subsidiaries and affiliates (collectively, " Employer" ), and Richard Whitney (" 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 . 1.1 Duties . Employer hereby employs Employee who, on March 1, 2008, will become the Chief Financial Officer, reporting to the Employer' s Chief Executive Officer (" CEO" ). Employee accepts such employment on the terms and conditions set forth in this Agreement. Employee shall perform the duties of Chief Financial Officer or any additional or different duties or jobs as the CEO deems appropriate. Employee shall work out of Employer' s El Segundo Corporate Headquarters. Employee agrees to devote his time, energy, and ability to the business of Employer on a part-time basis. Employee shall at all times observe and abide by the Employer' s policies and procedures as in effect from time to time.
1.2 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, provided , however , that Employer cannot terminate Employee' s employment without good cause before February 18, 2009. Nothing herein shall be deemed as limiting Employer' s right to change Employee' s duties or compensation before February 18, 2009.
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 . As of the Effective Date, Employer shall pay Employee a base salary of $500,000 per annum, less standard withholdings and authorized deductions. Employee shall be paid consistent with Employer' s payroll schedule. The base salary will be reviewed from time to time. 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 part-time employees. 2.3 Performance Bonus .
(a) Employee shall be eligible to receive a discretionary performance bonus (the " Bonus" ) between zero and $300,000, 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/her/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 the Chief Executive Officer.
2.5 Stock Appreciation Rights . Employer shall issue a grant to Employee of stock-settled Stock Appreciation Rights (" SSARS" ) on a base number of 200,000 shares of DaVita common stock, to be issued as follows: 70,000 shares on February 14, 2008; 50,000 shares on February 15, 2008; 30,000 shares on February 19, 2008; 30,000 shares on February 20, 2008; and 20,000 shares on February 21, 2008. This grant shall have a 3 and one-half year term from the date the shares are issued. The grant shall vest as follows: 116,667 shares shall vest on February 18, 2009, even if Employee is no longer the Chief Financial Officer so long as Employee is still employed by Employer and is working 25 hours per week; thereafter, so long as Employee is either the Chief Financial Officer or working at least 25 hours per week for Employer, the remainder of the shares will vest each month, on a pro-rata basis, with the grant being fully vested on February 18, 2010. The exercise price shall be the closing price as reported on the New York Stock Exchange on the date each of the shares is issued. The terms of the SSARS grant will be reflected in a separate agreement to be signed by Employer and Employee.
2.6 Management Share Ownership Policy . Employee shall review and understand the terms of the Management Share Ownership Policy with respect to all equity-based awards. 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 and will enter into an indemnification agreement consistent with those in effect for other officers of the Employer. 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. Certain Covenants of Executive . 3.1 Covenant Not to Compete :
(a) Employee agrees that during the term of his employment and for the twelve-month period following the termination of his employment for any reason (whether voluntary or involuntary), Employee shall not, as an employee, independent contractor, consultant, member of a board of director, or in any other form, provide any of the same or similar services that Employee performed during his employment with Employer for any other individual, partnership, limited liability company, corporation, independent practice association, management services organization, or any other entity (collectively, " Person" ) that provides dialysis or vascular access services, nephrology practice management, pharmaceuticals related to dialysis, kidney disease managem ...
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