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EXHIBIT 10.8
EMPLOYEE LEASING AGREEMENT
THIS EMPLOYEE LEASING AGREEMENT (the "Agreement") is entered into
effective as of October 15, 1999, by and between Iasis Healthcare Corporation,
a Delaware corporation, as successor-in-interest to JLL Hospital, LLC, a
Delaware limited liability company (the "Lessee") and Tenet Healthcare
Corporation, a Nevada corporation (the "Lessor"); provided, however that OrNda
HealthCorp. of Phoenix, Inc., American Medical (Central), Inc. S.C. San
Antonio, Inc., Mesa General Hospital Medical Center, Inc., Tenet Texas
Employment, Inc., National Medical Services, Inc. and Tenet HealthSystem
Medical, Inc. shall each be a party to this Agreement and a Lessor to the
extent each employs individuals at any of the Facilities.
WHEREAS, the Lessor has agreed to sell to the Lessee, and the Lessee has
agreed to purchase from the Lessor, certain healthcare assets and businesses of
the Lessor and its affiliates (the "Facilities") upon the terms and conditions
set forth in the Asset Sale Agreement by and between Lessee and Lessor dated as
of August 15, 1999 and the Asset Sale Agreement between Odessa Hospital, Ltd.
and Lessee dated August 15, 1999 (collectively, "Asset Sale Agreements"); and
WHEREAS, the Lessee desires to retain, and the Lessor desires to provide,
the temporary services of the Lessor's work force at the Facilities (the
"Facility Employees") in order to continue without interruption the operation
of the transferred assets and business following sale of the same by the Lessor
to the Lessee, until such time as the Facility Employees shall become employed
by Lessee.
NOW THEREFORE, in consideration of the premises and the representations,
warranties, covenants, agreements and undertakings hereinafter made, the
parties hereby agree as follows:
1. Term. The term of this Agreement shall be from the "Closing Date," as
such term is defined in the Asset Sale Agreements, through December 31, 1999.
2. Staffing. Lessor agrees to continue to employ the Facility Employees,
and to make the services of such employees available to Lessee, for the term of
this Agreement. Subject to Sections 3, 5 and 7 hereof, Lessor will continue to
be responsible for all wages, salaries and other compensation, employee
benefits, insurance, workers' compensation, employment taxes, withholding,
employee-related reporting, filing, and disclosure obligations, compliance with
all employment laws, and all other employment-related liabilities for the
Facility Employees which arise during the term of this Agreement.
3. Compensation. In exchange for Lessor's provision of staffing services,
Lessee shall pay as described below an amount equal to the out-of-pocket costs
or expenses (including but not limited to wages, salaries and other
compensation, employee benefits, insurance, workers' compensation, employment
taxes, withholding, administration, and insurance costs) incurred by Lessor in
connection with continued employment of its employees for the term of this
Agreement. Lessor shall provide the amount of such out-of -pocket costs or
expenses to Lessee by 5:00 p.m. Eastern Time on the Wednesday immediately
preceding the payday for the Facility Employees and Lessee shall wire said
amount on the following day, Thursday, so as to
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ensure that Lessor receives said amount no later than 5:00 p.m. Eastern Time
the following day, Thursday, in Lessor's account as designated by Lessor from
time to time.
4. Supervision. During the term of this Agreement, Lessor agrees that the
Facility Employees will perform such services as may be mutually agreed upon by
Lessor and Lessee. Lessee shall not act as an employer with respect to the
Facility Employees and shall have no responsibility, authority, or liability as
such. Lessor reserves the right and authority, in its capacity as employer, to
direct, supervise, and discipline (including hire, retain, and terminate) the
Facility Employees. However, Lessee shall be permitted to reasonably request
that Lessor release or replace any Facility Employee, which request shall be
promptly considered by Lessor. In particular, Lessee shall have the authority
to designate tasks to be performed, and shall have the authority to instruct
and oversee employees in the manner, means and method of accomplishing such
tasks.
5. Compliance. To the extent that Lessor is responsible for any legal
liability relating to or arising out of events, occurrences, conditions,
actions, or inactions with respect to the Facility Employees during the term of
this Agreement, including, without limitation, claims of, for, or relating to
employment discrimination, unfair labor practices, wage and hour violations,
health and safety violations, workers' compensation, employee benefits,
wrongful discharge, tort liability, breach of agreement, or any other violation
of sate or federal law or regulation, Lessee agrees to defend, indemnify, and
hold harmless Lessor from and against any and all such liabilities; provided,
however, that Lessee shall not be required to indemnify Lessor from any
liability resulting from Lessor's gross negligence or willful misconduct.
6. Wages and Salaries. Lessor shall pay the Facility Employees such wages,
salaries and bonuses, at such rate and at such times as it shall determine from
time to time for each Facility Employee, consistent with past employment
practices as of the effective date of this Agreement. Subject to Section 3
hereof, all withholding and payroll taxes due with respect to such payments, as
well as any other legally required contributions (such as in the nature of
social security payments) shall be the sole responsibility of Lessor. Lessee
shall not be obligated to pay any wage or salary to the Facility Employees
directly, nor shall it be responsible for any withholding taxes or
contributions due with respect to such payments.
7. Employee Benefits.
(a) During the term of this Agreement, Lessor shall continue to
maintain its employee benefit and fringe benefit plans, programs and
arrangements in effect at the execution of this Agreement and continue to
provide its employees with such employee benefits and fringe benefits as
authorized and provided pursuant to those plans, programs and arrangements
as of such date, or as thereafter amended, and Lessee shall fully
reimburse Lessor for all benefit costs, including without limitation claim
costs, premium costs and costs of administration paid by Lessor with
respect to all such benefits including, without limitation, the ongoing
costs associated with offering COBRA coverage to any Facility Employees
(or dependent thereof) who terminates employment with Lessor (or otherwise
incurs a qualified event) during the term of this Agreement (collectively,
the "Benefit Costs"). Lessor shall provide the amount of the Benefit Costs
to Lessee for a particular calendar month by 5:00 p.m. Eastern Time on the
day which is
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two (2) calendar days prior to the last calendar day of such month (the
"Submittal Date"), and Lessee shall wire said amount on the following
calendar day (the "Pay Date"), so as to ensure that Lessor receives said
amount no later than 5:00 p.m. Eastern Time on the Pay Date, in Lessor's
account as designated from time to time. Notwithstanding the foregoing, if
either the Submittal Date or the Pay Date falls on a day which is not a
business day, the Submittal Date and the Pay Date shall be accelerated in
such calendar month to the first date in such calendar month which would
enable both the Submittal Date and the Pay Date to fall on a business day.
Lessor shall give Lessee 30 days advance notice of any plan amendment that
would increase the employer costs thereunder.
(b) Lessor agrees to purchase and maintain from vendors recommended
and secured by Lessee, at Lessee's expense, such stop loss insurance as
may be requested and secured by Lessee with respect to the medical and
dental benefits provided to the Facility Employees.
8. Personnel Policies. Except as specified herein, all terms and
conditions of employment applicable to the Facility Employees shall be governed
by Lessor's personnel policies and practices in effect at the execution of this
Agreement, or as amended from time to time, and Lessee shall have no authority
to enforce, alter or interpret such policies and practices.
9. Workers' Compensation. Lessor shall provide workers' compensation
insurance for Lessor's employees during the term of the Agreement, provided,
however, that Lessee shall fully reimburse Lessor for any and all claims,
premiums and administrative costs associated with such coverage.
10. Transfer. Upon termination of this Agreement, Lessee shall
unconditionally make offers of employment to all Facility Employees who are
leased to Lessee under this Agreement at the expiration of the term hereof in
accordance with section 5.3 of the Asset Sale Agreements.
11. Third Party Beneficiaries. This Agreement and all conditions and
provisions hereof are for the sole and exclusive benefit of the parties hereto
and their respective successors and assigns and are not intended for the
benefit of any other person. In particular, nothing expressed by or mentioned
in this Agreement is intended or shall be construed to give any Facility
Employee or his or her respective heirs, assigns and beneficiaries, any legal
or equitable right, remedy or claim under or in respect to this Agreement or
any provision herein contained.
12. Notices. Any notice or other communication required or which may be
given hereunder shall be in writing and either be (i) delivered personally,
(ii) deposited in the United States mail, first class, certified, return
receipt requested, postage prepaid, or (iii) sent by electronic transmission,
receipt confirmed, and shall be deemed given when so delivered personally, or
if mailed, five business days after the date of such mailing, or upon receipt
of electronic transmission, and shall be addressed as follows:
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If to Lessor:
Tenet Healthcare Corporation
Paul Slavin
Tenet HealthSystem
Dallas Operations Center
14001 Dallas Parkway, Suite 200
Dallas, Texas 75240
with a copy to:
David I. Schiller, Esq.
Gibson, Dunn & Crutcher, L.L.P.
1717 Main Street, Suite 5400
Dallas, Texas 75201-7390
If to Lessee:
Frank A. Coyle
IASIS Healthcare Corporation
104 Woodmont, Suite 101
Nashville, Tennessee 37205
with a copy to:
Robert Pincus
Skadden, Arps, Slate, Meagher & Flom LLP
One Rodney Square
P.O. Box 636
Wilmington, Delaware 19899-0636
Either party may change its address to which notices or other communications
are to be sent by giving written notice of such change in the manner provided
herein for giving notice.
13. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
14. Headings. The headings contained in this Agreement are inserted for
convenience of reference only and shall not affect the meaning or interpretation
of this Agreement.
15. Severability. In the event any one or more of the provisions contained
in this Agreement or in any other instrument referred to herein shall, for any
reason, be determined to be invalid, illegal, or unenforceable in any respect,
such invalidity, illegality, or unenforceability shall not affect any other
provision hereof. Lessor and Lessee shall endeavor in good faith
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negotiations to modify the invalid, illegal or unenforceable provision to the
extent necessary to make such provision, valid, legal and enforceable and to
cause this Agreement to operate in a fair and equitable manner between the
parties. Each of the parties hereto agrees that it shall not allege the
invalidity, illegality, or unenforceability of this Agreement, or any one or
more of the provisions contained herein.
16. Relationship of Parties. Nothing herein contained shall constitute
Lessor and Lessee as members of any partnership, joint venture, association,
syndicate, or other entity, or be deemed to confer on any of them any express,
implied, or apparent authority to incur any obligation or liability on behalf
of another party, except as otherwise expressly provided herein.
17. Assignment. This Agreement and the rights, benefits, obligations
and remedies hereunder or any interest therein shall not be assignable or
transferable by operation of law or otherwise by Lessor or Lessee without the
prior written consent of each of them. Any attempt so to assign or to delegate
any of the foregoing without such consent shall be void.
TENET HEALTHCARE CORPORATION IASIS HEALTHCARE CORPORATION
By: /s/ Paul O'Neill By: /s/ Frank Coyle
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Name: Paul O'Neill Name: Frank Coyle
Title: Vice President Title: Secretary
ORNDA HEALTHCORP. OF PHOENIX, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
AMERICAN MEDICAL(CENTRAL), INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
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S.C. SAN ANTONIO, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
MESA GENERAL HOSPITAL MEDICAL
CENTER, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
TENET TEXAS EMPLOYMENT, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
NATIONAL MEDICAL SERVICES, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President
TENET HEALTHSYSTEM MEDICAL, INC.
By: /s/ Paul O'Neill
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Name: Paul O'Neill
Title: Vice President