Exhibit 10.1

EXECUTION VERSION

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of October 13,
2011 (the “Effective Date”), among American Renal Management LLC, a Delaware
limited liability company (the “Company”), American Renal Holdings Inc., a
Delaware corporation (“ARH”), and Michael R. Costa, a resident of the
Commonwealth of Massachusetts (the “Executive”).

RECITALS:

WHEREAS, the Company and the Executive each desires Executive’s employment under
this Agreement to be governed by this Agreement from and after the Effective
Date; and

NOW, THEREFORE, in consideration of the promises and the terms and conditions
set forth in this Agreement, the parties agree as follows:

ARTICLE 1

POSITION

During the term of this Agreement, the Company will employ the Executive, and
the Executive will serve the Company in the capacity of the General Counsel of
the Company.

ARTICLE 2

DUTIES

The Executive will perform duties that are executive in nature, consistent with
his title and as delegated by the Board of Directors of ARH (the “Board”). The
Executive shall report to the Chief Executive Officer of the Company.

ARTICLE 3

SERVICE

The Executive will devote substantially all his working time and efforts to the
business and affairs of the Company and the other members of the ARH Group,
except during vacation time, any periods of illness and leaves of absence that
have been duly authorized by the Board. Subject to Article 8 hereof, the
foregoing shall not, however, preclude the Executive from (i) engaging in
appropriate civic, charitable or religious activities, (ii) devoting a
reasonable amount of time to private investment activities, or (iii) providing
incidental assistance to family members on matters of family business and in
times of family emergencies, so long as the foregoing activities and service do
not conflict with or materially detract from the performance of the Executive’s
responsibilities to the Company.

ARTICLE 4

TERMS OF EMPLOYMENT

The Executive’s employment shall commence and this Agreement shall be effective
as of the Effective Date and shall continue for a term of one (1) year
thereafter, unless earlier terminated as provided in Article 6 of this Agreement
(the “Initial Term”). The Initial Term of this Agreement shall automatically
renew for successive one (1) year periods (each, a “Renewal Term” and together
with the Initial Term, the “Term”) unless the Company or the Executive has given
written notice to the other of its intent not to renew this Agreement (a
“Non-Renewal Notice”) at least 60 days prior to the expiration of the Initial
Term or any Renewal Term, as the case may be. During any Renewal Term, the
terms, conditions and provisions set forth in this Agreement shall remain in
effect unless modified in accordance with Section 9.7.

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ARTICLE 5

COMPENSATION AND BENEFITS

5.1. Base Salary. During the period commencing on the Effective Date, the
Company agrees to pay the Executive a base salary at an annual rate equal to
$316,250. The Executive will be entitled to periodic review of base salary and
to such increases, if any, as may be determined from time to time in the sole
discretion of the Board (the base salary as in effect from time to time is
defined as the “Base Salary”). The Executive’s Base Salary will be payable as
earned in accordance with the Company’s customary payroll practice and shall be
subject to customary withholding.

5.2. Bonus.

(a) In addition to the Base Salary, with respect to each full fiscal year during
the Term, the Executive shall be eligible to earn an annual cash bonus award (a
“Bonus”) based on the Company’s bonus program as established by the Company’s
compensation committee of the Board or the Board acting as the Company’s
compensation committee.

(b) The Bonus (less applicable withholding taxes) shall be paid no later than
thirty days following the completion by management of the audited financial
statements of the Company and Holding.

5.3. Additional Benefits. In addition to the benefits and entitlements otherwise
set forth herein, the Executive will be eligible to participate in the Company’s
benefit plans of general application as they may be established and modified
from time to time, including plans relating to pension, thrift, profit sharing,
life, health, disability, accident and dental insurance, education or other
retirement programs, and any other similar plans or programs that the Company
has adopted or may adopt for the benefit of its executive officers, in
accordance with the rules established for individual participation in any such
plan (including, but not limited to, the rules governing eligibility for such
participation) (“Benefits”). The Executive shall be entitled each calendar year
to (i) reasonable holidays and illness days in accordance with the Company’s
policies as may be established and modified from time to time and
(ii) reasonable paid vacation in accordance with the Company’s policies as may
be established and modified from time to time; provided that the Executive shall
schedule the timing and duration of vacations in a reasonable manner taking into
account the needs of the business of the ARH Group.

5.4. Expenses. The Company will reimburse the Executive for all reasonable and
necessary expenses incurred by the Executive in connection with the business of
the ARH Group (“Expenses”), provided that such expense reimbursements are in
accordance with applicable policies of the Company in effect from time to time
and are properly documented and accounted.

5.5. Insurance; Indemnification. Throughout the Term of this Agreement and for a
period of 12 months following the effective date of the Executive’s termination
from the Company’s employment, the Company or ARH agrees to maintain director
and officer liability insurance for the benefit of the Executive in scope and
amounts reasonably acceptable to the Board. Executive shall be entitled to
indemnification under ARH’s charter and bylaws or other indemnification
agreement as they exist from time to time, but always on a basis consistent with
the terms applicable from time to time for members of the Board.

5.6. Company’s Life Insurance. The Company, in its sole discretion, may apply
for and procure in its own name (whether or not for its own benefit) policies of
insurance insuring the life of Executive in such amounts as Company may deem
advisable. Executive shall have no right, title or interest in any such policies
of insurance, except to the extent his estate or other persons are specifically
named as beneficiaries thereof. Executive agrees to submit to any medical or
other examination and to

 

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execute and deliver any applications or other instrument in writing, reasonably
necessary to effectuate such insurance.

ARTICLE 6

TERMINATION

6.1. Events of Termination. The Executive’s employment with the Company shall
terminate upon any of the following:

(i) the effective date of a written notice by the Company to the Executive
stating the Board’s reasonable, good faith determination to terminate the
Executive for Cause (as defined in Section 6.2) (“Termination For Cause”);

(ii) the effective date of a written notice by the Company to the Executive
stating the Board’s reasonable, good faith determination, on the bases of advice
by a physician appointed by the Board, that due to a mental or physical
condition that the Company is not required to accommodate or cannot reasonably
accommodate, the Executive has been unable and failed to substantially render
the services to be provided by the Executive to the Company for a period of not
less than 180 days in any consecutive 12-month period (“Termination for
Disability”);

(iii) the Executive’s death (“Termination Upon Death”);

(iv) the effective date of a notice to the Executive stating that the Board is
terminating his employment, without Cause, which notice can be given by the
Company at any time at the Company’s sole discretion, for any reason or for no
reason (“Termination without Cause”); or

(v) the 60th day following the date the Executive delivers a notice to the
Company stating that the Executive is electing to terminate his employment with
the Company (“Resignation”).

6.2. Certain Definitions. For purposes of this Agreement,

“ARH” shall mean American Renal Holdings Inc., a Delaware corporation formerly
known as American Renal Associates Inc.

“ARH Group” shall mean ARH and its direct and indirect subsidiaries.

“Cause” shall mean any of the following: (a) the Executive’s being convicted of,
or having pled guilty or nolo contendere to, any crime if as a result the
Executive’s continued association with the Company it is likely to be injurious
to its business or reputation; (b) the Executive’s breach of duty of loyalty
which is detrimental to the Company involving personal profit to the Executive;
(c) the Executive’s willful failure to perform or adhere to explicitly stated
duties or guidelines of employment or to follow the directives of the Board
(which are not unlawful to perform or to adhere to or follow) following a
written warning that if such failure continues it will be deemed a basis for
dismissal for Cause; or (d) the Executive’s gross negligence or willful
misconduct in the performance of the Executive’s duties.

“Company” shall mean American Renal Management LLC, a Delaware limited liability
company.

 

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ARTICLE 7

EFFECT OF TERMINATION

7.1. Termination for Cause; Resignation. In the event of any termination of the
Executive’s employment pursuant to Section 6.1(i) (Termination for Cause) or
Section 6.1(v) (Resignation):

(i) the Executive shall be entitled to receive his Base Salary and reimbursement
of Expenses for periods through the effective date of his termination.

(ii) the Executive’s rights to Benefits under the Company’s benefit plans of
general application shall be determined under the provisions of those plans.

(iii) the Executive shall be entitled to any Bonus earned for any fiscal year
prior to the year of termination, which Bonus shall be paid as set forth in
Section 5.2 (the amounts and benefits described in clauses (i), (ii) and (iii),
the “Accrued Benefits”).

7.2. Termination without Cause. In the event of termination of employment
pursuant to Section 6.1(iv) (Termination without Cause), (a) Executive shall be
entitled to receive the Accrued Benefits; (b) conditioned upon and subject to
the Executive’s compliance with the restrictive covenants under Article 8 and
the Executive executing and delivering a valid general release (that is no
longer subject to revocation under applicable law) in a form consistent with the
Company’s standard form of general release for departing executives in the form
of Exhibit A attached hereto (“General Release”) (which shall be provided by the
Company to the Executive no later than 10 days after the date of Executive’s
termination of employment) within 52 days following the date of Executive’s
termination of employment, Executive shall be entitled to severance compensation
in an amount equal to 100% of Base Salary, payable in equal monthly installments
over the twelve-month period following the effective date of his termination, in
accordance with the Company’s usual executive salary payment practice and
subject to all withholding obligations; and (c) Executive and his eligible
dependants shall continue to be eligible to participate in all of the Company’s
group health plans on the same terms and conditions as active employees of the
Company until the earlier of (A) the expiration of the 12-month period following
the effective date of his termination or (B) the date Executive is or becomes
eligible for comparable coverage under health plans of another employer;
provided that the foregoing continuation coverage shall be contingent on
Executive electing to receive COBRA continuation coverage and making premium
payments equal to those premiums payable by other active senior executives
during the relevant period on the same basis as if Executive had continued his
employment and any excess premium cost applicable for such coverage if it had
been purchased by Executive for the applicable COBRA premium shall be imputed
income to Executive for the appropriate periods of provision of such coverage.

7.3. Termination for Death; Disability. In the event of termination of
employment pursuant to Section 6.1(ii) (Termination for Disability) or
Section 6.1(iii) (Termination upon Death), Executive shall be entitled to
receive the Accrued Benefits.

ARTICLE 8

NONCOMPETITION, NONSOLICITATION AND CONFIDENTIALITY

8.1. Restrictive Covenants.

8.1.1. The Executive acknowledges that (a) the ARH Group has at considerable
expense purchased and developed valuable goodwill, going concern value, customer
and client relationships and confidential information that are valuable property
rights of the ARH Group and (b) the Executive’s position with the ARH Group is
and has been such that the Executive has had and will continue to have

 

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access to and knowledge concerning such rights, which if used other than for the
benefit of the ARH Group could significantly injure the ARH Group. Accordingly,
and in consideration of the mutual promises contained herein, and in order to
protect the goodwill and going concern value of the ARH Group, the Executive
agrees to the covenants set forth below. As used herein, “Restrictive Period”
means the period beginning on the Effective Date and ending on the second
(2nd) anniversary of the effective date of the termination of the Executive’s
employment with the Company, however such termination may occur.

8.1.2. The Executive recognizes and acknowledges that certain assets of the ARH
Group constitute Confidential Information. The term “Confidential Information”
as used in this Agreement shall mean all information which is known only to the
Executive or the ARH Group, other employees or others in a confidential
relationship with the ARH Group (including but not limited to any entity
controlled by, controlling or under common control with the ARH Group (each, an
“Affiliate”) and their respective employees and officers), and relating to the
ARH Group’s or any Affiliate’s business (including, without limitation,
information regarding clients, customers, pricing policies, methods of
operation, proprietary computer programs, sales, products, profits, costs,
markets, key personnel, formulae, product applications, technical processes, and
trade secrets), as such information may exist from time to time, which the
Executive acquired or obtained by virtue of work performed for the ARH Group, or
which the Executive may acquire or may have acquired knowledge of during the
performance of said work. The Executive agrees that at all times during his
employment and thereafter (including periods after the term of this Agreement),
he will keep and maintain all Confidential Information and all of the affairs of
the ARH Group and its Affiliates confidential, and will not, except (i) as
necessary for the performance of his responsibilities hereunder or (ii) as
required by judicial process and after prior notice to the Company (as early as
practicable, and in any event not less than three (3) days prior to any such
required disclosure), unless required earlier by a court order or a legal
requirement, disclose to any person for any reason or purpose whatsoever,
directly or indirectly, all or any part of the Confidential Information of the
ARH Group and its Affiliates. The Executive is not bound by the restrictions in
this paragraph with respect to any information that becomes public other than as
a consequence of the breach by the Executive of his confidentiality obligations
hereunder or is disclosed without an obligation of confidentiality. The
Executive can disclose all information to his personal advisors, in the context
of seeking advice regarding employment hereunder, subject to becoming liable for
any violation by them of the Executive’s confidentiality obligations. The
Executive agrees that on the termination of his employment, however such
termination may occur, the Executive will promptly return to the Company all
materials and other property from time to time held by the Executive and
proprietary to the ARH Group including without limitation any documents
incorporating, reflecting or reproducing in whole or in part any Confidential
Information, credit cards, and the like.

8.1.3. During the Restrictive Period, the Executive shall not, and shall not
cause any entity or business enterprise of which he is an employee, officer,
promoter, director, shareholder, partner, trustee or consultant to, (i) persuade
or attempt to persuade any employee or contracting physician of the Company
and/or its Affiliates to terminate his relationship with the Company and/or its
Affiliates, or (ii) employ in any capacity any person who was at any time during
the period of the Executive’s employment by the Company employed in any capacity
by the Company or any of its Affiliates; provided, the Executive shall have the
right to employ certain independent contractor professionals used by the Company
or its Affiliates, such as lawyers, accountants or engineers, if the Executive’s
retention of such persons or entities would not impede or interfere with any
continuing relationship between such person or entity and the Company and/or its
Affiliates.

8.1.4. During the Restrictive Period, the Executive will not, directly or
indirectly, compete with the Company and/or its Affiliates as an owner, partner,
member, shareholder, consultant, agent, employee, director or co-venturer of any
business (i) engaged in the kidney dialysis business and/or the operation of
kidney dialysis facilities within 10 miles of any such facility owned and
operated by the

 

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ARH Group, (ii) engaged in the kidney dialysis business and/or the operation of
kidney dialysis facilities where the Executive is involved in a program to
establish joint ventures with nephrologists in the United States of America, and
(iii) in the case of a termination of employment that occurs on or before the
second anniversary of the Effective Date, engaged in the kidney dialysis
business and/or the operation of kidney dialysis facilities in the United States
of America. In addition to the foregoing, the Executive will not during the
Restrictive Period represent any other entity or business enterprise in
conducting substantial negotiations with any nephrologists with whom such
Executive had conducted substantial negotiations on behalf of the ARH Group
during the one (1) year period immediately prior to the termination of such
Executive’s employment with the Company, however such termination may occur, for
the purpose of establishing a business relationship between such nephrologists
and such other entity or business enterprise. Notwithstanding the foregoing,
this Section 8.1.4 is not intended to prohibit or restrict the Executive from
(i) holding a direct or indirect equity interest in ARH, or (ii) owning up to
five percent (5%) of the outstanding stock of a publicly held corporation that
competes with the ARH Group.

8.2. Inventions and Patents. The Executive acknowledges that all inventions,
innovations, improvements, developments, methods, designs, analyses, drawings,
reports and all similar or related information (whether or not patentable) which
relate to the ARH Group’s actual or anticipated business, research and
development or existing or future products or services and which are conceived,
developed or made by the Executive while employed by the Company (“Work
Product”) belong to the ARH Group. The Executive shall promptly disclose such
Work Product to the Board and perform all actions reasonably requested by the
Board (whether during or after the term of this Agreement) to establish and
confirm such ownership (including, without limitation, assignments, consents,
powers of attorney and other instruments).

8.3. Enforcement; Remedies. The Executive covenants, agrees and recognizes that
because the breach or threatened breach of the covenants, or any of them,
contained in Section 8.1 hereof will result in immediate and irreparable injury
to the ARH Group, the ARH Group shall be entitled to an injunction restraining
the Executive from any violation of Section 8.1 to the fullest extent allowed by
law. The Executive further covenants and agrees that in the event of a violation
of any of the respective covenants and agreements contained in Section 8.1
hereof, (i) the ARH Group shall be entitled to receive all such amounts to which
the ARH Group would be entitled as damages under law or at equity and (ii) upon
the ARH Group obtaining a judgment or an injunction from a court of competent
jurisdiction, the obligations of the ARH Group to make any further payments to
Executive pursuant to any provision of this Agreement shall be suspended until
Executive shall cease violating or breaching his respective covenants and
agreements contained in Section 8.1 hereof and the ARH Group shall have received
reasonable assurances from Executive that he will no longer engage in the same
at which time the previously suspended payments shall be made to Executive.
Nothing herein shall be construed as prohibiting the ARH Group from pursuing any
other legal or equitable remedies that may be available to it for any such
breach, including the recovery of damages from the Executive. The prevailing
party in any action relating to a violation or alleged violation of any on the
of the respective covenants and agreements contained in Section 8.1 hereof shall
be entitled to receive for the other party, and such other party shall pay to
the prevailing party, its reasonable and documented costs and expenses
associated with such action.

8.4. Construction. The Executive hereby expressly acknowledges and agrees as
follows:

(i) the covenants set forth in Article 8 are reasonable in all respects and are
necessary to protect the legitimate business and competitive interests of the
ARH Group in connection with their business which the Executive agrees, pursuant
to this Agreement, to assist in maintaining and developing; and

 

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(ii) each of the covenants set forth in Article 8 is separately and
independently given, and each such covenant is intended to be enforceable
separately and independently of the other such covenants, including without
limitation, enforcement by injunction, and that the invalidity or
unenforceability of any provision of this Agreement in any respect shall not
affect the validity or enforceability of this Agreement in any other respect.

In the event that any provision of this Agreement shall be held invalid or
unenforceable by a court of competent jurisdiction by reason of the geographic
or business scope or the duration thereof of any such covenant, or for any other
reason, such invalidity or unenforceability shall attach only to the particular
aspect of such provision found invalid or unenforceable as applied and shall not
affect or render invalid or unenforceable any other provision. This Agreement
shall be construed as if the geographic or business scope or the duration of
such provision or other basis on which such provisions has been challenged had
been more narrowly drafted so as not to be invalid or unenforceable. The
provisions under Article 8 shall survive the termination of the Executive’s
employment for any reason.

ARTICLE 9

MISCELLANEOUS

9.1. Arbitration. Except with respect to controversies or claims arising under
Article 8 hereof, the Executive and the Company shall submit to mandatory
binding arbitration in any controversy or claim arising out of, or relating to,
this Agreement or any breach hereof. Such arbitration shall be conducted in
Boston, Massachusetts in accordance with the employment rules of the American
Arbitration Association in effect at the time such arbitration is conducted, and
judgment upon the determination or award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. The arbitrator is hereby
authorized to award to the prevailing party the costs (including reasonable
attorneys’ fees and expenses) of any such arbitration.

9.2. Absence of Conflicting Agreements and Obligations. The Executive represents
and warrants that he is not a party to or bound by any other agreement or
understanding of any type, whether written or oral, or by any statutory or
common law duty or obligation which, in any case, would in any way restrict his
ability to be employed by the Company, or his ability to compete freely with any
other Person.

9.3. Severability. If any provision of this Agreement shall be found by any
arbitrator or court of competent jurisdiction to be invalid or unenforceable,
then the parties hereby waive such provision to the extent that it is found to
be invalid or unenforceable and to the extent that to do so would not deprive
one of the parties of the substantial benefit of its bargain. Such provision
shall, to the extent allowable by law and the preceding sentence, be modified by
such arbitrator or court so that it becomes enforceable and, as modified, shall
be enforced as any other provision hereof, all the other provisions continuing
in full force and effect.

9.4. No Waiver. The failure by either party at any time to require performance
or compliance by the other of any of its obligations or agreements shall in no
way affect the right to require such performance or compliance at any time
thereafter. The waiver by either party of a breach of any provision hereof shall
not be taken or held to be a waiver of any preceding or succeeding breach of
such provision or as a waiver of the provision itself. No waiver of any kind
shall be effective or binding, unless it is in writing and is signed by the
party against whom such waiver is sought to be enforced.

9.5. Assignment. This Agreement and all rights hereunder are personal to the
Executive and may not be transferred or assigned by the Executive at any time.
The Company may assign its rights, together with its obligations hereunder, to
any parent, subsidiary, affiliate or successor, or in connection with any sale,
transfer or other disposition of all or substantially all of the business and
assets of the

 

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Company (whether by merger or otherwise), provided, however, that any such
assignee assumes the Company’s obligations hereunder.

9.6. Entire Agreement. As of the Effective Date, this Agreement constitutes the
entire agreement between the parties relating to the employment of the Executive
with the Company, and this Agreement supersedes and cancels any and all previous
contracts, arrangements or understandings, whether written or oral, with respect
thereto.

9.7. Amendment. This Agreement may be amended, modified, superseded, canceled,
renewed or extended only by an agreement in writing executed by both parties
hereto.

9.8. Notices. All notices and other communications required or permitted under
this Agreement shall be in writing and hand delivered, sent by telecopier, sent
by registered first class mail, postage prepaid return receipt requested, or
sent by nationally recognized express courier service. Such notices and other
communications shall be effective upon receipt, to the following addresses, or
such other addresses as any party shall notify the other parties:

If to the Company:

American Renal Management LLC

66 Cherry Hill Drive

Beverly, Massachusetts 01915

Attn: Chief Executive Officer

Facsimile: (978) 750-4740

with a copy to:

Centerbridge Capital Partners, L.P.

375 Park Avenue, 12th Floor

New York, New York 10152

Facsimile: (212) 672-5001

Attention: Steven M. Silver

                  Jared S. Hendricks

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017

Facsimile: (212) 455-2502

Attention: Gregory Grogan, Esq.

If to the Executive:

Michael R. Costa

10 Farm Road

Rehoboth, MA 02769

9.9. Binding Nature. This Agreement shall be binding upon, and inure to the
benefit of, the successors and personal representatives of the respective
parties hereto.

9.10. Headings. The headings contained in this Agreement are for reference
purposes only and shall in no way affect the meaning or interpretation of this
Agreement.

 

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9.11. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original but all of which, taken
together, constitute one and the same agreement.

9.12. Governing Law. This Agreement and the rights and obligations of the
parties hereto shall be governed by and construed in accordance with the laws of
the Commonwealth of Massachusetts, without giving effect to the principles of
conflict of laws.

9.13. Compliance with IRC Section 409A.

(a) Notwithstanding anything herein to the contrary, (i) if at the time of the
Executive’s termination of employment with the Company Executive is a “specified
employee” as defined in Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”), and the deferral of the commencement of any payments or
benefits otherwise payable hereunder as a result of such termination of
employment is necessary in order to prevent any accelerated or additional tax
under Section 409A of the Code, then the Company will defer the commencement of
the payment of any such payments or benefits hereunder (without any reduction in
such payments or benefits ultimately paid or provided to Executive) until the
date that is six months following Executive’s termination of employment with the
Company (or the earliest date as is permitted under Section 409A of the Code
without any accelerated or additional tax) and (ii) if any other payments of
money or other benefits due to Executive hereunder could cause the application
of an accelerated or additional tax under Section 409A of the Code, such
payments or other benefits shall be deferred if deferral will make such payment
or other benefits compliant under Section 409A of the Code, or otherwise such
payment or other benefits shall be restructured, to the extent possible, in a
manner, determined by the Board, that is reasonably expected not to cause such
an accelerated or additional tax. Any payment or benefit delayed by reason of
the prior sentence shall be paid out or provided in a single lump sum at the end
of such required delay period in order to catch up to the original payment
schedule.

(b) For purposes of Section 409A of the Code, each payment made under this
Agreement shall be designated as a “separate payment” within the meaning of
Section 409A of the Code, any series of installment payments under this
Agreement shall be treated as a right to a series of separate payments, and
references herein to Executive’s “termination of employment” shall refer to
Executive’s separation from service with the Company within the meaning of
Section 409A of the Code.

(c) (i) Any reimbursements by the Company to the Executive of any eligible
expenses under this Agreement that are not excludable from the Executive’s
income for Federal income tax purposes (the “Taxable Reimbursements”) shall be
made by no later than the earlier of the date on which they would be paid under
the Company’s normal policies and the last day of the taxable year of the
Executive following the year in which the expense was incurred.

(ii) The amount of any Taxable Reimbursements, and the value of any in-kind
benefits to be provided to the Executive, during any taxable year of the
Executive shall not affect the expenses eligible for reimbursement, or in-kind
benefits to be provided, in any other taxable year of the Executive (except for
any life-term or other aggregate limitation applicable to medical expenses).

(iii) The right to Taxable Reimbursement, or in-kind benefits, shall not be
subject to liquidation or exchange for another benefit.

(d) Notwithstanding any other provisions of this Agreement or any other
agreement to which the Company and the Executive are parties to the contrary, in
no event shall any payment under this

 

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Agreement that constitutes “deferred compensation” for purposes of Section 409A
of the Code be subject to offset by any other amount unless otherwise permitted
by Section 409A of the Code.

9.14. MUTUAL WAIVER OF JURY TRIAL REGARDING ARTICLE 8. BECAUSE DISPUTES ARISING
IN CONNECTION WITH COMPLEX TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY
RESOLVED BY AN EXPERIENCED AND EXPERT PERSON, THE PARTIES DESIRE THAT ANY CLAIM
OR CONTROVERSY ARISING UNDER ARTICLE 8 HEREOF BE RESOLVED BY A JUDGE APPLYING
APPLICABLE LAWS. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ALL RIGHTS TO TRIAL
BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY SUCH CLAIM OR
CONTROVERSY BETWEEN THE PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT, OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO ARTICLE 8 OF
THIS AGREEMENT.

9.15. Construction of Terms. In this Agreement, the singular includes the
plural, the plural includes the singular, and the masculine gender includes both
male and female references.

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Signature Page to the Employment Agreement between American Renal Management
LLC, American Renal Holdings Inc. and Michael R. Costa

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first set forth above.

 

AMERICAN RENAL HOLDINGS INC. By:   /s/ Joseph A. Carlucci

Name:

Title:

 

Joseph A. Carlucci

Chief Executive Officer

 

 

AMERICAN RENAL MANAGEMENT LLC By:   /s/ John J. McDonough

Name:

Title:

 

John J. McDonough

Chief Operating Officer

 

 

/s/ Michael R. Costa Michael R. Costa

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EXHIBIT A

FORM OF RELEASE AND WAIVER OF CLAIMS

This Release and Waiver of Claims (“Release”) is entered into as of this [ • ]
day of ______________, 20[—], by Michael R. Costa (the “Executive”).

The Executive agrees as follows:

1. The employment relationship between the Executive and American Renal
Management LLC, a Delaware limited liability company (the “Company”) and its
subsidiaries and affiliates, as applicable, [will terminate][terminated] on the
[ • ] day of ______________, 20[-] (the “Termination Date”) pursuant to
Section 6.1(iv) of the Employment Agreement between the Company, American Renal
Holdings, Inc., a Delaware limited liability company and the Executive dated
[            ], 2011 (the “Employment Agreement”). The Executive [has resigned
or] hereby resigns from all positions as an officer, director or otherwise for
the Company and each of its subsidiaries and affiliates.

2. In consideration of the payments, rights and benefits provided for in
Section 7.2 of the Employment Agreement (“Separation Terms”) and this Release,
the sufficiency of which the Executive hereby acknowledges, the Executive, on
behalf of the Executive and the Executive’s agents, representatives, attorneys,
administrators, heirs, executors and assigns (collectively, the “Employee
Releasing Parties”), but subject to Section 4 hereof, hereby releases and
forever discharges the Company Released Parties (as defined below), from all
claims, charges, causes of action, obligations, expenses, damages of any kind
(including attorneys fees and costs actually incurred) or demands, in law or in
equity, whether known or unknown, which may have existed or which may now exist
from the beginning of time to the date of this Release, arising from or relating
to the Executive’s employment or termination from employment with the Company or
otherwise, including a release of any rights or claims the Executive may have
under Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991;
the Age Discrimination in Employment Act of 1967, as amended (“ADEA”); the Older
Workers Benefit Protection Act; the Americans with Disabilities Act of 1990; the
Rehabilitation Act of 1973; the Family and Medical Leave Act of 1993;
Section 1981 of the Civil Rights Act of 1866; Section 1985(3) of the Civil
Rights Act of 1871; the Employee Retirement Income Security Act of 1974; the
Fair Labor Standards Act; any other federal, state or local laws against
discrimination; or any other federal, state, or local statute, regulation or
common law relating to employment, wages, hours, or any other terms and
conditions of employment. This includes a release of any and all claims or
rights arising under contract (whether written or oral, express or implied),
covenant, public policy, tort or otherwise. For purposes hereof, “Company
Released Parties” shall mean the Company, any of its direct or indirect
stockholders holding a beneficial ownership of more than 5% of the Company’s
voting stock and any of its and their respective divisions, parents, members,
subsidiaries, affiliates, predecessors, successors (and any of its and their
respective past, current and future employees, agents, insurers, attorneys,
administrators, officials, directors, direct or indirect shareholders, employee
benefit plans, and the sponsors, fiduciaries, or administrators of such employee
benefit plans in their individual or representative capacities).

3. The Executive acknowledges that the Executive is waiving and releasing rights
that the Executive may have under the ADEA and other federal, state and local
statutes contract and the common law and that this Release is knowing and
voluntary. The Executive agrees that this Release does not apply to any rights
or claims that may arise after the date of execution by the Executive of this
Release. The Executive acknowledges that the consideration given for this
Release is in addition to anything of value to which the Executive is already
entitled. The Executive further acknowledges that the Executive has been advised
by this writing that: (i) the Executive should consult with an attorney prior to
executing this Release; (ii) the Executive has up to twenty-one (21) days within
which to consider this Release, although the Executive may, at the Executive’s
discretion, sign and return this Release at an earlier time, in which case the
Executive waives all rights to the balance of this twenty-one (21) day review
period;

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and (iii) for a period of 7 days following the execution of this Release (the
“Revocation Period”) in duplicate originals, the Executive may revoke this
Release in a writing delivered to __________, and this Release shall not become
effective or enforceable until the Revocation Period has expired.

4. This Release does not release the Company Released Parties from (i) any
obligations due to the Executive under the Separation Terms or under this
Release, (ii) any rights the Executive has to indemnification by the Company (or
any subsidiary or affiliate thereof) and to directors and officers liability
insurance coverage under the Employment Agreement or otherwise, (iii) any vested
rights the Executive has under the Company’s employee pension benefit plans or
any other tax-qualified employee benefit plans as a result of the Executive’s
actual service with the Company, or (iv) any rights of the Executive as a
shareholder or optionholder of the Company (or any subsidiary or affiliate
thereof), in the Executive’s sole capacity as such (including, without
limitation, any rights to proceeds from the sale or other action with respect to
any stock or options of the Company (or any subsidiary or affiliate thereof).

5. The Executive represents and warrants that he has not filed any action,
complaint, charge, grievance, arbitration or similar proceeding against the
Company Released Parties.

6. This Release is not an admission by the Company Released Parties or the
Employee Releasing Parties of any wrongdoing, liability or violation of law.

7. The Executive waives any right to reinstatement or future employment with the
Company following the Executive’s separation from the Company on the Termination
Date.

8. The Executive shall continue to be bound by the restrictive covenants
contained in the Employment Agreement or any other agreement with the Company or
its affiliates, in accordance with their terms.

9. This Release shall be governed by and construed in accordance with the laws
of the Commonwealth of Massachusetts, without reference to the principles of
conflict of laws.

10. Any controversy or claim arising out of or relating to this Release shall be
resolved by binding confidential arbitration by a single arbitrator who is
licensed to practice law in a State in the United States, to be held in Boston,
Massachusetts, in accordance with the Employee Dispute Resolution Rules of the
American Arbitration Association (or its successor rules). The arbitrator shall
have the discretionary authority to award attorneys’ and arbitrator’s reasonable
fees and expenses and the costs of arbitration to the prevailing party. Judgment
upon the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. The arbitrator’s decision shall be in writing and shall
include the findings of fact and a statement of law on which the decision is
based.

11. This Release represents the complete agreement between the Executive and the
Company concerning the subject matter in this Release and supersedes all prior
agreements or understandings, written or oral, with respect solely to the
subject matter hereof. For avoidance of doubt, this Release does not supersede
that certain Stockholders Agreement dated as of [March 22, 2010] among the
Company’s affiliates and their stockholders, including the Executive, or any
option award agreement to which the Executive is a party. This Release may not
be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.

12. Each of the sections contained in this Release shall be enforceable
independently of every other section in this Release, and the invalidity or
unenforceability of any section shall not invalidate or render unenforceable any
other section contained in this Release.

 

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13. The Executive acknowledges that the Executive has carefully read and
understands this Release, that the Executive has the right to consult an
attorney with respect to its provisions and that this Release has been entered
into knowingly and voluntarily. The Executive acknowledges that no
representation, statement, promise, inducement, threat or suggestion has been
made by any of the Company Released Parties to influence the Executive to sign
this Release except such statements as are expressly set forth herein or in the
Employment Agreement.

 

The parties to this Release have executed this Release as of the day and year
first written above.

 

Michael R. Costa   

By:

Title:

 

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