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EXHIBIT 10.9
TENET BUYPOWER
PURCHASING ASSISTANCE AGREEMENT
This Purchasing Assistance Agreement (this "Agreement") is entered into by and
between Iasis Healthcare Corporation, a Delaware corporation as successor in
interest to JLL Hospital, LLC, a Delaware limited liability company, for itself
and on behalf of its subsidiaries identified on Exhibit A, attached hereto and
incorporated herein by this reference (collectively hereinafter, "Purchaser"),
located at 104 Woodmont, Suite 101, Nashville, Tennessee 37205, and Tenet
HealthSystem Medical, Inc., on behalf of itself and its affiliates, a Delaware
Corporation ("Tenet"), located at 14001 Dallas Parkway, Dallas, Texas 75240.
WITNESSETH:
A. Purchaser (through its direct and indirect subsidiaries) owns and/or
operates those certain facilities listed on Exhibit B, attached hereto
and incorporated herein by this reference (hereinafter referred to as
"a facility" or collectively as "the facilities"), through which
Purchaser and its direct and indirect subsidiaries (collectively,
"Hospital") provides medical and hospital services.
B. Tenet maintains agreements for purchasing various goods, supplies,
materials, dietary products, pharmaceutical and equipment used by
hospitals on a national basis.
C. Hospital desires to purchase such goods, supplies, materials, dietary
products, pharmaceutical and equipment under said national supply and
purchase agreements to the extent permitted by such agreements, and to
the extent that the price for purchase hereunder would be based upon
meeting vendor terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth, it is agreed as follows:
1. PURPOSE:
Hospital hereby employs Tenet to assist Hospital in the purchasing of
various supplies, goods, materials, dietary products, pharmaceutical
and equipment used in the Hospital's normal and customary operations of
the facilities and Tenet agrees to assist Hospital in the purchasing of
such supplies, goods, materials, dietary products, pharmaceutical and
equipment for the facilities, all as is more fully set forth below.
2. TERM:
Subject to prior termination under Paragraph 6, below, the term of this
Agreement shall be for a period of one year commencing on October 5,
1999, and ending on October 16, 2000 (the "Initial Term"); provided,
however, that unless notice of termination is provided by Hospital at
least 30 days prior to the expiration of the Initial Term or any
renewal term, this agreement shall automatically be extended for
successive one year periods.
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3. TENET'S RESPONSIBILITIES:
a. Prior to the commencement date of this Agreement, Tenet has
delivered, or caused to be delivered, to Hospital a copy (or
brief summary hereof) of all national purchase and supply
agreements which Tenet has in effect at that time.
Additionally, Tenet will, during the term hereof, provide
Hospital with copies of any additional amendments, changes, or
terminations to such agreements on a timely basis so that
Hospital can be advised thereof.
b. Tenet will provide consultation with Hospital to effect a
smooth transition.
c. Tenet shall notify each of the contracting parties to such
national purchase and supply agreements that Hospital is
participating in such agreements to the extent permitted by
such agreements and accordingly is entitled to purchase of
such goods, supplies, materials, dietary products,
pharmaceutical and equipment and receive the same discounts
thereunder as Tenet.
d. Hospital acknowledges that Tenet has certain subsidiaries and
divisions in the health care field. Certain of these
subsidiaries or divisions may, from time to time, make
proposals to or do business with Hospital. Tenet shall in each
instance cause the disclosure of the related nature of such
enterprises, and Hospital shall in each such instance be free
to enter into or reject any such proposals or business dealing
solely on the respective merits.
4. REPRESENTATIONS AND COVENANTS OF HOSPITAL:
Hospital hereby represents to and covenants with Tenet as follows:
a. All purchasing by Hospital of goods, supplies, materials,
dietary products, pharmaceuticals and equipment under said
national purchasing and supply agreements shall be in the name
of Hospital or its controlled affiliates, and Hospital shall
be solely responsible for payment therefor.
b. Any purchase by Hospital under any such national purchase and
supply agreement will be between Hospital and the respective
contractor; Tenet does not make any warranty, express or
implied, as to such goods, supplies, materials, dietary
products, pharmaceuticals or equipment.
c. Hospital shall indemnify and hold Tenet harmless from any
liability brought against them or any of them as a result of
Hospital's action or inaction with respect to such national
purchase and supply agreements.
5. ADMINISTRATIVE FEES:
Tenet shall share back 50% of all administrative fees paid by suppliers
against the Hospital's purchases as identified in Paragraph 8 of this
Agreement.
6. TERMINATION:
a. During the term hereof, either party may terminate this
Agreement with or without
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cause at any time by giving written notice to the other, such
termination to be effective sixty (60) days after the date
such notice is given.
b. Upon termination of this Agreement, whether by expiration of
its term or otherwise, provided that Tenet is not performing
services on a month-to-month basis as provided in Paragraph 2
above, neither Hospital nor Tenet shall have any further
obligations hereunder, and particularly no obligation to
maintain, update, or advise concerning any system or procedure
provided hereunder.
7. SUCCESSORS AND ASSIGNS:
a. No party hereto may assign its interest in or delegate the
performance of its obligations under this Agreement to any
other person without obtaining the prior written consent of
the other party. Hospital may assign its interest to a duly
authorized successor in interest provided, however, that any
such transferee or assignee shall expressly assume in writing
the obligations of Hospital to Tenet as set forth herein.
b. The terms, provisions, covenants, obligations and conditions
of this Agreement shall be binding upon and shall inure to the
benefit of the successors in interest and the assigns of the
parties hereto, provided that no assignment, transfer, pledge
or mortgage by or through either party, as the case may be, in
violation of the provisions of this Agreement, shall vest any
rights in the assignee, transferee, pledgee or mortgagee.
8. FEE FOR PURCHASING ASSISTANCE AGREEMENT:
Hospital acknowledges that, as part of an agreement to furnish goods or
services to Hospital, Tenet may receive a group purchasing
administrative fee in connection with certain products that are
purchased, licensed or leased by Hospital. Such payment shall equal 3%
or less of the purchase price of the goods or services provided by the
participating vendor. Tenet shall disclose to Hospital in writing, on
an annual basis, and to the Secretary of Health and Human Services upon
his or her request, the amount received from each vendor with respect
to purchases made by or on behalf of Hospital. Within 90 days after the
end of each fiscal quarter of Tenet (FYE May 31) during the term of
this Agreement, Tenet shall provide Hospital with information from
venders regarding administrative fees with respect to purchases by
Hospital hereunder for such quarterly period.
9. NOTICES:
Any notice by any party to the other shall be in writing and shall be
deemed to have been given on the earlier of (a) the date on which it is
delivered personally or (b) four (4) days after it is deposited in the
U.S. mail, postage prepaid, certified with return receipt requested and
addressed to the party at its address as set forth on Page 1 of this
Agreement (or at such other address as may have been designated by the
party pursuant to this Paragraph 9).
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10. APPLICABLE LAW:
This Agreement is entered into in the State of New York and shall be
governed by the laws of the State of York and all actions concerning
this Agreement shall be brought in the courts of the State of New York.
11. ACCESS TO BOOKS AND RECORDS OF TENET BY SECRETARY OF HHS OR AUTHORIZED
REPRESENTATIVE:
Upon written request of the Secretary of Health and Human Services or
the Comptroller General or any of their duly authorized
representatives, Tenet or any other related organization providing
services with a value or cost of ten thousand dollars ($10,000.00) or
more, over a twelve (12) month period, shall make available to the
Secretary the contracts, books, documents and records that are
necessary to certify the nature and extent of the costs of providing
such services. Such inspection shall be available up to four (4) years
after the rendering of such services. This paragraph is not intended to
prohibit or impede any state audits pursuant to state law.
12. ENTIRE AGREEMENT:
This Agreement constitutes the sole and only Agreement of the parties
hereto with respect to purchasing assistance services to the facilities
and correctly sets forth the rights, duties, and obligations of each to
the other as of its date. Any and all prior agreements, promises,
proposals, negotiations or representations, whether written or oral
with respect to purchasing assistance services to the facilities, which
are not expressly set forth in this Agreement are hereby superseded and
are of no force or effect. This Agreement is considered confidential,
therefore, any specifics of this Agreement will not be discussed unless
mutual consent has been agreed upon by both parties.
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IN WITNESS WHEREOF, the parties have caused this instrument to be duly executed
by their authorized representatives this 15th day of October, 1999.
TENET HEALTHSYSTEM MEDICAL, INC. IASIS HEALTHCARE CORPORATION
By: /s/ Paul O'Neill /s/ Frank Coyle
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Name: Paul O'Neill Signature
Title: Vice President
Frank Coyle
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Print Name
Secretary
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Title
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EXHIBIT A
PURCHASER SUBSIDIARIES
St. Luke's Medical Center, LP
St. Luke's Behavioral Center, LP
Health Choice Arizona, Inc.
Metro Ambulatory Surgery Center, Inc.
Biltmore Surgery Center, Inc.
Palms of Pasadena, LP
Odessa Regional Hospital, LP
Tempe St. Luke's Hospital, LP
Memorial Hospital of Tampa, LP
Mesa General Hospital, LP
Town & Country Hospital, LP
Southwest General Hospital, LP
SSJ St. Petersburg Holdings, Inc.
First Choice Physicians Network Holdings, Inc.
Baptist Joint Venture Holdings, Inc.
Beaumont Hospital Holdings, Inc.
Iasis Healthcare Holdings, Inc.
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EXHIBIT B
FACILITIES
HealthChoice Arizona
Memorial Hospital of Tampa
Mesa General Hospital
Mid-Jefferson Hospital
Odessa Regional Hospital
Palms of Pasadena Hospital
Park Place Medical Center
St. Luke's Medical Center
St. Luke's Behavioral Health Center
Southwest General Hospital
Tempe St. Luke's Hospital
Town & Country Hospital
Davis Hospital and Medical Center
Jordan Valley Hospital
Pioneer Valley Hospital
State Street Hospital
Salt Lake Regional Medical Center