EXHIBIT 10.9

October 15, 2002

 

Lori S. Richardson Pellicioni

9040 Alto Cedro Drive

Beverly Hills, CA 90210

 

Dear Lori:

 

On behalf of DaVita Inc., I am pleased to finalize the terms of your new
position as Vice President, Compliance and Chief Compliance Officer. In this new
role, you will report to the DaVita Board of Directors, Joe Mello and me. Your
start date has yet to be determined. The following represents the terms and
conditions in this regard:

 

As we discussed, your base salary for this position has been set at $210,000.00
per annum, less standard deductions and authorized withholdings. Your base
salary will be reviewed each year during DaVita’s annual salary review. DaVita,
in its sole discretion, may increase the base salary as a result of any such
review. In addition, you will be eligible to receive an annual performance bonus
between zero and $135,000, which will be prorated the first year and is payable
in a manner consistent with our practices and procedures. Your position is
exempt under the wage and hour laws. You will be paid bi-weekly pursuant to our
normal payroll practices. Your status will be that of a regular full-time
benefit eligible employee.

 

You and your family shall be eligible for participation in and receive all
benefits under DaVita’s health and welfare benefit plans under the same terms
and conditions applicable to DaVita executives at similar levels of compensation
and responsibility. A summary of those benefits will be presented to you at the
start of your employment.

 

The Board of Directors has approved that you receive a grant of stock options to
purchase 80,000 shares of DaVita stock. Such options will have a five-year term
and will vest over a four-year period, one-quarter vesting on each anniversary
of the grant. The exercise price will be the closing price on the New York Stock
Exchange on the start date of your employment. The options will be reflected in
a separate Stock Option Agreement. DaVita is currently in the process of
developing an Executive Equity Ownership requirement. Specific details will be
communicated when completed. In the meantime, should you have any questions, you
can feel free to contact either Rich Whitney, CFO, or myself.

 

The Company will provide you with a separate indemnification agreement. Our
indemnification agreement is currently being reviewed by outside counsel to
ensure that it is consistent with the newly enacted federal laws; once that
review is completed, we will send the indemnity agreement to you. DaVita also
agrees to reimburse you in accordance with its travel and entertainment
policies, as well as other business-related expenses, incurred in the
performance of your duties. Based upon your estimated travel schedule, DaVita
agrees to allow you to purchase coach seats as per our normal travel policy. For
trips in excess of three (3) hours, DaVita will reimburse you for upgrades to
Business Class. This is subject to change at DaVita’s discretion.

 

Our offer of employment is conditioned upon your successful completion of a
pre-employment drug test, which must be successfully completed before you can
start your employment. Please contact Moira Ireland at 310/750-2232 to arrange
for a pre-employment drug test, which must be completed before you can start
your employment.

 

This Agreement, separate Stock Option Agreement,
Non-Compete/Confidentiality/Non-Solicitation Agreement and provisions relating
to termination of employment represent the entire understanding of the parties
hereto with respect to your employment and supercedes all prior agreements with
respect thereto. This Agreement may not be altered or amended except in writing
executed by both parties hereto.

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October 15, 2002

   

Lori S. Richardson Pellicioni

 

Page 2

 

This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, but all of which together constitute one and the same
instrument. Photographic or facsimile copies of such signed counterparts may be
used in lieu of the originals for any purpose.

 

In the event that any provision of the Agreement is determined to be illegal,
invalid or void for any reason, the remaining provisions hereof shall continue
in full force and effect.

 

If the above terms of employment are acceptable to you, please sign below and
return this Agreement to me as soon as possible. In addition, please read and
sign the attached Non-Compete/Confidentiality/Non-Solicitation Agreement.

 

Sincerely,

 

Kent Thiry

Chief Executive Officer

DaVita Inc.

 

I accept the position of Vice President, Compliance and Chief Compliance Officer
under the terms and conditions outlined above.

 

                       

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Lori S. Richardson Pellicioni

         

Date

 

cc: Joe Mello

Chief Operating Officer

 

Robert D. Armstrong

Vice President, People Services