DAVITA INC. (NYSE:DVA) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain OfficersItem 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Amendment to Employment Agreement
DaVita Inc. (the “Company”) entered into an amendment (the “Amendment”) to the employment agreement with Kent J. Thiry, the Company’s Chairman and Chief Executive Officer and the Chief Executive Officer of DaVita Medical Group, effective as of August 20, 2018. The Amendment removes the additional payment that Mr. Thiry would be eligible to receive for excise taxes incurred under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), and replaces such provision with a provision that automatically reduces any payments or benefits related to a change in control of the Company to the extent necessary to avoid the imposition of excise taxes under Section 4999 of the Code, provided that such reduction would result in a better after-tax result for Mr. Thiry. The foregoing summary description of the Amendment does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Amendment, which is filed as Exhibit10.1 hereto and incorporated by reference herein.
Rule of 65 Policy
On August 19, 2018, the Company adopted a Rule of 65 Policy (the “Policy”) that establishes administrative guidelines for the post-retirement treatment of outstanding equity awards granted prior to the effective date of the Policy and which otherwise do not contemplate retirement vesting. Under the Policy, a qualifying retirement occurs upon an eligible employee’s termination of employment other than a termination by the Company for “cause” (as defined in the applicable underlying award agreement) on or after the date on which the sum of the eligible employee’s age and years of service equals or exceeds 65, with a minimum age of 55 and a minimum of five years of continuous service. Under the terms of the Policy, an eligible employee is generally defined as an “officer” subject to Section 16 of the Securities Exchange Act of 1934, as amended, as of the date of such employee’s termination of employment. In the event of a qualifying retirement, the Policy provides for outstanding equity awards to be treated as follows, subject to the employee's timely execution of a release of claims:
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Stock-Settled Stock Appreciation Rights (“SSARs”). SSARs will become exercisable in accordance with their normal vesting schedules as if the employee had remained employed with the Company and will remain outstanding until their normal expiration dates, in each case, as set forth in the underlying award agreements, subject to accelerated exercisability in the event of a change in control of the Company in which the SSARs are not assumed or continued. |
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Time-Based Restricted Stock Units (“RSUs”). RSUs will become fully vested and will be settled within 60 days following an eligible employee’s qualifying retirement. |
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Performance-Based Restricted Stock Units (“PSUs”). PSUs will vest as if the employee had remained employed with the Company, based on actual performance during the applicable performance period, with any vested PSUs to be settled no later than 60 days following the end of the applicable performance period, subject to accelerated settlement in the event of a change in control of the Company in which the PSUs are not assumed or continued. |
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Pro-rata Vesting. If the qualifying retirement occurs prior to the first anniversary of the grant date of an eligible award, then the portion of the award eligible for vesting will be prorated based on the number of full months from the grant date to the employee’s qualifying retirement divided by 12. |
The foregoing summary description of the Policy does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Policy, which is filed as Exhibit10.2 hereto and incorporated by reference herein.
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Item 9.01 |
Financial Statements and Exhibits. |
(d) Exhibits.
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Exhibit Number |
Description |
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10.1 |
Amendment Number Two to Employment Agreement, effective as of August 20, 2018, by and between DaVita Inc. and Kent J. Thiry. |
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10.2 |
DaVita Inc. Rule of 65 Policy, adopted on August 19, 2018. |
DAVITA INC. ExhibitEX-10.1 2 exhibit101.htm EXHIBIT 10.1 Exhibit AMENDMENT NUMBER TWO TO EMPLOYMENT AGREEMENTThis Amendment Number Two to Employment Agreement (“Amendment”) is made and entered into as of August 20,…To view the full exhibit click here
About DAVITA INC. (NYSE:DVA)
DaVita Inc., formerly DaVita HealthCare Partners Inc., is a provider of kidney care services. The Company operates Kidney Care division and HealthCare Partners (HCP) division. The Company’s segments include U.S. dialysis and related lab services, HCP and Other-Ancillary services and strategic initiatives. The Company’s Kidney Care division is a provider of dialysis services in the United States, treating patients with chronic kidney failure and end stage renal disease (ESRD). HCP division is a patient and physician-focused integrated health care delivery and management company.
