Kinetic Concepts Inc – ‘10-K/A’ for 12/31/94

As of:  Tuesday, 1/23/96   ·   For:  12/31/94   ·   Accession #:  831967-96-3   ·   File #:  1-09913

in

this entire Filing. an “Entity” Search.

Show

Documents searched

and

each “hit”. the 1st “hit”.

↓↑Hints

Amendment to Annual Report   —   Form 10-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K/A      Amendment to Annual Report                            55±   200K 

Document Table of Contents

SECURITIES AND EXCHANGE COMMISSION                    
Washington, D.C.  20549                   

FORM 10-K/A - Number 1                    
(Mark One)                                                                      
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE                  
SECURITIES                    
EXCHANGE ACT OF 1934                    
For the Fiscal Year Ended December 31, 1994                   

[  ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)                 
OF THE SECURITIES EXCHANGE ACT OF 1934                    

Commission File Number 0-9913                   

KINETIC CONCEPTS, INC.          
(Exact name of Registrant as specified in its charter)                    

Texas                   74-1891727                      
(State of Incorporation)     (I.R.S. Employer                           
      Identification Number)

8023 Vantage Drive, San Antonio, Texas  78230                   
(Address of Principal Executive Officer)                    

(210) 524-9000                    
(Registrant's telephone number, including area code)                    

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:                   
None                    

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:                   
Common Stock, par value $.001 per share                   

Indicate by check mark whether the registrant (1) has  filed                    
all  reports required to be filed by Section 13 or 15(d)  of                    
the Securities Exchange Act of 1934 during the preceding  12                    
months  (or for such shorter period that the registrant  was                    
required to file such reports), and (2) has been subject  to                    
such filing requirements for the past 90 days. Yes X  No __                     

Indicate  by  check mark if disclosure of delinquent  filers                    
pursuant  to  Item  405 of Regulation S-K is  not  contained                    
herein,   and  will  not  be  contained,  to  the  best   of                    
registrant's  knowledge, in definitive proxy or  information                    
statements  incorporated by reference in Part  III  of  this                    
Form 10-K or any amendment to this Form 10-K.  [  ]                             

The  aggregate  market  value of  the  voting  stock  (which                    
consists  solely  of  shares  of  Common  Stock)   held   by                    
non-affiliates  of the registrant as of January 19, 1996,                       
(based  upon  the  last sale price of $11.375  per  share),  was                
approximately $152,407,244 on such date.                                        

As of January 19, 1996, there were 44,332,806 shares of the                     
Registrants Common Stock outstanding.                                           

Portions  of  the  following documents are  incorporated  by                    
reference into the designated Parts of this Form 10-K:   (a)                    
Annual  Report  to  Shareholders for the fiscal  year  ended                    
December  31,  1994 (in parts I and II) and  (b)  Definitive                    
Proxy  Statement  relating to the  1994  Annual  Meeting  of                    
Shareholders  (in Part III), which the Registrant  filed  no                    
later  than 120 days after the close of the Company's fiscal                    
year.                                                                           

INSERT TO FORM 10-K/A                   

Item 14.  Exhibits, Financial Statement Schedules and                           
Reports on Form 8-K (Continued)                             

3.   The following exhibits are filed as a part of this                         
Report:                                                                         

Exhibit   Description                                                           

3.1  Restatement of Articles of Incorporation (filed                  
as Exhibit 3.2 to the Company's Registration                
Statement on Form S-1, as amended (Registration             
No. 33-21353), and incorporated herein by                   
reference).                                                 

3.2  Restated By-Laws of the Company (filed as Exhibit                
3.3 to the Company's Registration Statement on              
Form S-1, as amended (Registration No. 33-21353),           
and incorporated herein by reference).                      

4.1  Specimen Common Stock Certificate of the Company                 
(filed as Exhibit 4.1 to the Annual Report on Form          
10-K for the year ended December 31, 1988, and              
incorporated herein by reference).                          

10.1  Agreement dated September 29, 1987, by and                        
between the Company and Hill-Rom Company, Inc.              
(filed as Exhibit 10.7 to the Company's                     
Registration Statement on Form S-1, as amended              
(Registration No. 33-21353), and incorporated               
herein by reference).                                       

10.2  Employment and Non-Competition Agreement dated                    
December 26, 1986, by and between the Company and           
James R. Leininger, M.D. (filed as Exhibit 10.10            
to the Company's Registration Statement on Form S-          
1, as amended (Registration No. 33-21353), and              
incorporated herein by reference).                          

10.3  Contract dated September 30, 1985, by and between                 
Ryder Truck Rental, Inc. and the Company                    
regarding the rental of delivery trucks (filed as           
Exhibit 10.23 to the Company's Registration                 
Statement on Form S-1, as amended (Registration             
No. 33-21353), and incorporated herein by                   
reference).                                                 

10.4  1988 Kinetic Concepts, Inc. Directors Stock                       
Option Plan (filed as Exhibit 10.26 to the                  
Company's Registration Statement on Form S-1, as            
amended (Registration No. 33-21353), and                    
incorporated herein by reference).                          

10.5  Kinetic Concepts, Inc. Employee Stock Ownership                   
Plan and Trust dated January 1, 1989 (filed as              
Exhibit 10.2 to the Company's Quarterly Report on           
Form 10-Q for the quarter ended June 30, 1989,              
and incorporated herein by reference).                      

10.6  1987 Key Contributor Stock Option Plan, as                        
amended, dated October 27, 1989 (filed as Exhibit           
10.9 to the Company's Annual Report on Form 10-K            
for the year ended December 31, 1989, and                   
incorporated herein by reference).                          

10.7  Amendment No. 1 to Asset Purchase Agreement dated                 
September 30, 1994 by and among Kinetic Concepts,           
Inc., a Texas corporation, KCI Therapeutic                  
Services, Inc., a Delaware corporation, MEDIQ               
Incorporated, a Delaware corporation, PRN                   
Holdings, Inc., a Delaware corporation and                  
MEDIQ/PRN Life Support Services-I, Inc., a                  
Delaware corporation (filed as Exhibit 2.2 to the           
Company's Form 8-K dated October 17, 1994, and              
incorporated herein by reference).                          

10.8  Promissory Note dated September 30, 1994 in the                   
principal amount of $2,000,000 payable by PRN               
Holdings, Inc., a Delaware corporation, to the              
order of KCI Therapeutic Services, Inc., a                  
Delaware corporation  (filed as Exhibit 99.1 to             
the Company's Form 8-K dated October 17, 1994,              
and incorporated herein by reference).                      

10.9  Promissory Note dated September 30, 1994 in the                   
principal amount of $2,956,957 payable by                   
MEDIQ/PRN Life Support Services-I, Inc., a                  
Delaware corporation, to the order of KCI                   
Therapeutic Services, Inc., a Delaware                      
corporation (filed as Exhibit 99.2 to the                   
Company's Form 8-K dated October 17, 1994, and              
incorporated herein by reference).                          

10.10  Promissory Note dated September 30, 1994 in the                    
principal amount of $3,000,000 payable by PRN               
Holdings, Inc., a Delaware corporation, to the              
order of KCI Therapeutic Services, Inc., a                  
Delaware corporation  (filed as Exhibit 99.3 to             
Company's Form 8-K dated October 17, 1994, and              
incorporated herein by reference).                          

10.11  Promissory Note dated September 30, 1994 in the                    
principal amount of $5,000,000 payable by PRN               
Holdings, Inc., a Delaware corporation, to the              
order of KCI Therapeutic Services, Inc., a                  
Delaware corporation (filed as Exhibit 99.4 to              
the Company's Form 8-K dated October 17, 1994,              
and incorporated herein by reference).                      

10.12  Promissory Note dated September 30, 1994 in the                    
principal amount of $5,835,707 payable by                   
MEDIQ/PRN Life Support Services-I, Inc., a                  
Delaware corporation, to the order of KCI                   
Therapeutic Services, Inc., a Delaware                      
corporation (filed as Exhibit 99.5 to the                   
Company's Form 8-K dated October 17, 1994, and              
incorporated herein by reference).                          

10.13  Negative Covenants Agreement dated September 30,                   
1994 by and among Kinetic Concepts, Inc., a Texas           
corporation, KCI Therapeutic Services, Inc., a              
Delaware corporation, MEDIQ Incorporated, a                 
Delaware corporation, PRN Holdings, Inc., a                 
Delaware corporation and MEDIQ/PRN Life Support             
Services-I, Inc., a Delaware corporation (filed             
as Exhibit 99.6 to the Company's Form 8-K dated             
October 17, 1994, and incorporated herein by                
reference).                                                 

10.14  Guaranty Agreement dated September 30, 1994 made                   
by PRN Holdings, Inc., a Delaware corporation, in           
favor of KCI Therapeutic Services, Inc., a                  
Delaware corporation (filed as Exhibit 99.7 to              
the Company's Form 8-K dated October 17, 1994,              
and incorporated herein by reference).                      

10.15  Guaranty Agreement dated September 30, 1994 made                   
by MEDIQ Incorporated, a Delaware corporation, in           
favor of KCI Therapeutic Services, Inc., a                  
Delaware corporation (filed as Exhibit 99.8 to              
the Company's Form 8-K dated October 17, 1994,              
and incorporated herein by reference).                      

10.16  Collateral Transfer of Note (Security Agreement)                   
dated September 30, 1994 by MEDIQ Incorporated, a           
Delaware corporation, for the benefit of KCI                
Therapeutic Services, Inc., a Delaware                      
corporation (filed as Exhibit 99.9 to the                   
Company's Form 8-K dated October 17, 1994, and              
incorporated herein by reference).                          

10.17  Credit Agreement dated as of May 8, 1995 by and                    
among the Company and Bank of America National              
Trust and Savings Association, as Agent (filed as           
Exhibit 10 to the Company's Quarterly Report on             
Form 10-Q for the quarter ended March 31, 1995,             
and incorporated herein by reference).                      

*10.18  Purchasing Agreement, dated February 1, 1994,                       
between between the Company, KCI Therapeutic                
Services, Inc. and Voluntary Hospitals of                   
America, Inc.                                               

*10.19  Rental/Purchasing Agreement, dated April 1, 1993                    
between the Company, KCI Therapeutic Services,              
Inc. and AmHS Purchasing Partners, L.P.                     

*10.20  KCI Management 1994 Incentive Program                               

*10.21  KCI Employee Benefits Trust Agreement                               

*10.22  Letter, dated September 19, 1994, from the                          
Company to Raymond R. Hannigan outlining the                
terms of his employment.                                    

*10.23  Letter, dated November 22, 1994, from the Company                   
to Christopher M. Fashek outlining the terms of             
his employment.                                             

*10.24  Option Agreement, dated November 21, 1994,                          
between Dr. James R. Leininger, Cecelia Leininger           
and Raymond R. Hannigan.                                    

*10.25  Option Agreement, dated August 23, 1995, between                    
Dr. James R. Leininger, Cecelia Leininger and               
Bianca A. Rhodes.                                           

10.26  Stock Purchase Agreement dated June 15, 1995                       
among KCI Financial Services, Inc., Kinetic                 
Concepts, Inc., Cura Capital Corporation, MG                
Acquisition Corporation and the Principal                   
Shareholders of Cura Capital Corporation (filed             
as Exhibit 10 to the Company's Quarterly Report             
on Form 10-Q for the quarter ended June 30, 1995,           
and incorporated herein by reference).                      

10.27  Promissory Note dated August 21, 1995 in the                       
principal amount of $10,000,000 payable by James            
R. Leininger, M.D. to the order of Kinetic                  
Concepts, Inc., a Texas corporation (filed as               
Exhibit 2.2 to the Company's Quarterly Report on            
Form 10-Q for the quarter ended September 30,               
1995, and incorporated herein by reference).                

10.28  Stock Pledge Agreement dated August 21, 1995 by                    
and between James R. Leininger, M.D. and Kinetic            
Concepts, Inc., a Texas corporation (filed as               
Exhibit 2.3 to the Company's Quarterly Report on            
Form 10-Q for the quarter ended September 30,               
1995, and incorporated herein by reference).                

10.29  Executive Committee Stock Ownership Plan (filed                    
as Exhibit 10 to the Company's Quarterly Report             
on Form 10-Q for the quarter ended June 30, 1995,           
and incorporated herein by reference).                      

10.30  Deferred Compensation Plan (filed as Exhibit 99.2                  
to the Company's Quarterly Report on Form 10-Q              
for the quarter ended September 30, 1995, and               
incorporated herein by reference).                          

11.1  Earnings Per Share Computation (filed as Exhibit                  
11.1 to the Annual Report on Form 10-K for the              
year ended December 31, 1994, and incorporated              
herein by reference).                                       

13.1  Kinetic Concepts, Inc. 1994 Annual Report to                      
Shareholders (furnished for the information of              
the Commission and not deemed to be "filed,"                
except for those portions expressly incorporated            
herein by reference) (filed as Exhibit 13.1 to              
the Annual Report on Form 10-K for the year                 
ended December 31, 1994, and incorporated herein            
by reference).                                              

*22.1  List of Subsidiaries.                                              

23.1  Consent by KPMG Peat Marwick dated December, 1995                 
to incorporation by reference of their reports              
dated February 14, 1995 in Registration                     
Statements on Form S-8 previously filed by the              
Company. (filed as Exhibit 23.1 to the Annual               
Report on Form 10-K for the year ended December             
31, 1994, and incorporated herein by reference).            

*    Filed herewith                                                             

EXHIBIT 10.18                                                                   
Purchasing Agreement                    

This agreement ("Agreement"), made and entered into  as               
of  the  1st day of February, 1994, by and between Voluntary                    
Hospitals of America, Inc., a Delaware corporation  ("VHA"),                    
and  Kinetic Concepts, Inc. and KCI Therapeutic Services,  a                    
Delaware corporation ("Vendor"),                                                

Preliminary Statements:                   

A.    VHA  is,  among other things, in the business  of               
providing  purchasing  opportunities with  respect  to  high                    
quality   products   and  services  to  certain   healthcare                    
providers  who  have  appointed VHA  as  their  agent  ("VHA                    
Members  and Affiliates"), a current list of which has  been                    
provided to Vendor by VHA;                                                      

B.    Vendor is, among other things the manufacturer of               
the products listed on Exhibit A hereto ("Products"); and                       

C.    Vendor  and  VHA  desire  to  make  the  Products               
available  for  purchase by VHA Members and Affiliates  from                    
Vendor pursuant to this Agreement;                                              

In  consideration of the premises, the  representations               
and  warranties of the parties, and other good and  valuable                    
consideration,  the  adequacy, receipt  and  sufficiency  of                    
which  are acknowledged, the parties agree, subject  to  the                    
conditions,  terms  and  provisions of  this  Agreement,  as                    
follows:                                                                        

Section  1.  Offer, Sale and Prices.  During  the  term               
and  for  the duration of this Agreement, Vendor  agrees  to                    
offer to rent and sell and to rent and sell the Products  to                    
VHA Members and Affiliates at the prices provided on Exhibit                    
A,  and,  to the extent not in conflict with the  terms  and                    
conditions stated here, the terms and conditions  stated  in                    
Exhibit B.                                                                      

Upon prior written notice to VHA, Vendor may offer such               
lower  prices  to  VHA Members and Affiliates  as  it  deems                    
necessary to respond to competitive situations, provided                        

such  offers,  if accepted, shall be subject  to  all  other                    
terms and conditions of this Agreement,except for Section 7.                    

Vendor  shall  not offer to VHA Members and  Affiliates               
other  products in conjunction with the Products covered  by                    
this  Agreement  under terms and conditions  such  that  VHA                    
Members  and Affiliates have no real economic choice  except                    
to  purchase Products with such other products on a  bundled                    
basis, without the prior written notice to VHA.                                 

Section 2.     Delivery, Transportation Charges. Vendor               
agrees  to  promptly  deliver Products  ordered  under  this                    
Agreement  by  the  VHA  Members  and  Affiliates,  FOB  San                    
Antonio.   Vendor  agrees to prepay and absorb  charges,  if                    
any,  for  transporting  products to  the  VHA  Members  and                    
Affiliates.                                                                     

Section 3.     Billing by and Payment to Vendor. Vendor               
agrees   to  directs  its  invoices  for  Products   ordered                    
hereunder tot he VHA Members and Affiliates.  Sales  payment                    
terms and 2%-10, Net 30 days.  Rental payment terms are  2%-                    
30, Net 31.                                                                     

Section  4.      Term  and Duration.   Subject  to  the               
termination   provisions  contained  in  Section   5,   this                    
Agreement  shall  remain  in  full  force  and  effect  from                    
March 1, 1994 through February 28, 1997.  Upon  the  mutual                     
written  agreement  of the parties, this  Agreement  may  be                    
extended for two one-year terms.                                                

Section  5.     Termination.  Notwithstanding  anything               
to  the  contrary  contained herein, this Agreement  may  be                    
terminated by either party at any time, at will, and without                    
cause  upon  not  less than sixty (60)  days  prior  written                    
notice to the other party.                                                      

Section  6.      Price Reduction Meeting.  The  parties               
agree  to  meet,  at the request of either  party,  no  less                    
frequently  than once in any ninety (90) day  period  during                    
the  term  of  this  Agreement to discuss  whether  a  price                    
reduction  for  any  Product can  be  agreed  upon  by  both                    
parties.                                                                        

Section 7.     Favored Customer Pricing.Notwithstanding               
anything  to  the contrary contained herein, the  price  for                    
each  Product  under this Agreement will be no greater  than                    
the  lowest price charged by Vendor under similar terms  and                    
conditions  during  the  term of  this  Agreement  for  such                    
Product  or  any product which, except for the  labeling  of                    
which,  is  substantially similar to such Product.   In  the                    
event  Vendor offers prices lower than provided for in  this                    
Agreement under different terms and conditions, Vendor shall                    
communicate immediately all details of such offer to VHA and                    
agrees  to  offer  such lower prices to any  VHA  Member  or                    
Affiliate   which  is  willing  to  meet  such   terms   and                    
conditions.                                                                     

Section 8.     Failure to Supply.  In the event  Vendor               
fails  to promptly deliver any Product to any VHA Member  or                    
Affiliate,  and  does  not  offer  a  reasonably  acceptable                    
substitute  product  at the original price,  each  such  VHA                    
Member  or  Affiliate  may  purchase  such  Product   or   a                    
reasonably similar competitive product from any source;  and                    
Vendor  agrees  to  pay such VHA Member  or  Affiliate  upon                    
request,  the difference between the price paid by such  VHA                    
Member or Affiliate and such lower price provided for  under                    
this Agreement.                                                                 

Section 9.     Compliance with Laws. Vendor represents,               
warrants  and  guarantees that all articles comprising  each                    
shipment  or delivery by Vendor ("Articles") to  or  on  the                    
order  of  VHA, VHA Members or Affiliates, or any  of  their                    
agents,  affiliates or customers ("Customers"), are,  as  of                    
the  date  of such shipment, in compliance with all federal,                    
state   and   local   laws,  statutes,  ordinances,   rules,                    
regulations and orders.  Without limiting the generality  of                    
the  preceding  sentence,  Vendor  specifically  represents,                    
warrants and guarantees that all Articles are not:   (a)  in                    
violation of Section 5 or 12 of the Federal Trade Commission                    
Act,  and are properly labeled as to content as required  by                    
applicable  Federal Trade Commission Trade  Practice  Rules;                    
(b)  in  violation  of  any of the provisions  of  the  Fair                    
Packaging  and  Labeling Act; (c) adulterated or  misbranded                    
within  the  meaning of the Federal Food, Drug and  Cosmetic                    
Act,  as  amended, or within the meaning of  any  applicable                    
state   or  municipal  law  in  which  the  definitions   of                    
adulteration  and  misbranding are  substantially  identical                    
with  those contained in the Federal Food, Drug and Cosmetic                    
Act,  or  Articles  which may not under  the  provisions  of                    
Sections 404, 505, 512, 514 or 515 of said Act be introduced                    
into  interstate  commerce or is not a banned  device  under                    
Section   516   of  said  Act,  or  which  may   not   under                    
substantially similar provisions of any state  or  municipal                    
law  be  introduced into commerce; (d) in violation  of  the                    
Consumer  Product  Safety Act of 1972,  as  amended  by  the                    
Consumer Product Safety Commission Improvements Act of 1976,                    
or  any standard and regulation thereunder; (e) in violation                    
of  any  of  the  provisions  of  the  Federal  Insecticide,                    
Fungicide  and  Rodenticide Act, as amended by  the  Federal                    
Environment  Pesticide Control Act of  1972;  (f)  hazardous                    
substances  or,  if they are hazardous substances,  are  not                    
misbranded   hazardous  substances   or   banned   hazardous                    
substances  within  the  meaning of  the  Federal  Hazardous                    
Substances  Act  as  amended (including the  former  Federal                    
Caustic  Poison Act); (g) manufactured or sold in  violation                    
of any of the provisions of the Fair Labor Standards Act, as                    
amended,  or any regulation or order issued thereunder;  (h)                    
misbranded  under  the  provisions  of  the  Wool   Products                    
Labeling Act; (i) manufactured or sold in violation  of  any                    
applicable   Equal   Employment   Opportunity   requirement,                    
including those set forth in Section 202 of Executive  Order                    
11246, as amended; (j) manufactured or sold in violation  of                    
the  Occupational Safety and Health Act of 1970, as amended,                    
any   standard  or  regulation  issued  thereunder,  or  any                    
applicable state law or regulation pertaining to job  safety                    
or  health; (k) in violation of the Toxic Substances Act  or                    
any  standard  or  regulation  issued  thereunder;  (l)   in                    
violation  of  the  Magnuson-Moss  Warranty  Federal   Trade                    
Commission  Improvement  Act;  (m)  in  violation   of   the                    
Biological  Products  Section of the Public  Health  Service                    
Act; or (n) in violation of any requirement of the Flammable                    
Fabrics  Act,  as  amended,  and  regulations  and  standard                    
thereunder,  or  applicable  codes  of  the  National   Fire                    
Protection  Association (NFPA) and any applicable  state  or                    
local  laws substantially identical to the Flammable Fabrics                    
Act  or which adopt the tests provided for in any applicable                    
code  of  the  NFPA, and that reasonable and  representative                    
tests   as   prescribed  by  the  Consumer  Product   Safety                    
Commission  have  been  performed to  show  conformity  with                    
applicable flammability standards.                                              

Vendor  shall  reimburse Customers for any  cost  associated                    
with  any  product corrective action, withdrawal  or  recall                    
requested by Vendor or required by any governmental  entity.                    
In  the  event a product recall or a court action  impacting                    
supply  occurs, the Vendor shall conduct all product recalls                    
per  its  established  procedure and  shall  notify  VHA  in                    
writing  within twenty-four hours of any such  action.   The                    
representations, warranties and guarantees made by Vendor in                    
this  Section survive any termination of this Agreement  and                    
shall  be  continuing and binding upon the  Vendor  and  its                    
successors  and/or assigns, whichever the case may  be,  and                    
shall  inure  to the benefit of Customers, their  successors                    
and assigns and to the benefit of their officers, directors,                    
agents   and   employees   and   their   heirs,   executors,                    
administrators, successors and assigns.                                         

Section 10.    Books and Records, Audit.  Vendor agrees               
to   keep,  maintain  and  preserve  complete,  current  and                    
accurate  books,  records and accounts of  the  transactions                    
contemplated  by  this Agreement and such additional  books,                    
records  and  accounts  as are necessary  to  establish  and                    
verify  Vendor's compliance under this Agreement.  All  such                    
books,   records  and  accounts  shall  be   available   for                    
inspection   and   audit   by   VHA   and   its   authorized                    
representatives  at  any  time  during  the  term  of   this                    
Agreement  and  for two (2) years thereafter,  but  no  more                    
frequently than twice in any consecutive twelve month period                    
and   only   during  reasonable  business  hours  and   upon                    
reasonable  notice.  The exercise by VHA  of  the  right  to                    
inspect  and  audit is without prejudice  to  any  other  or                    
additional rights or remedies of either party.                                  

Section 11.    Indemnity and Insurance.  Vendor  hereby               
agrees  to protect, defend, indemnify and to hold  VHA,  VHA                    
Members  and  Affiliates and their respective  subsidiaries,                    
affiliates,     directors,    officers     and     employees                    
("Indemnitees")  harmless from any loss, liability,  damage,                    
cost   or  expense  (including  attorneys'  fees  and  other                    
expenses  of  litigation)  because  of  (i)  personal/bodily                    
injury, including death at any time resulting therefrom,  or                    
damage  to  property,  including loss  of  use  thereof  and                    
downtime,  caused  by  any  Product  or  (ii)  any  material                    
misrepresentation, breach of warranty or covenant, or  other                    
breach  or default by Vendor under this Agreement; provided,                    
however,  that  Vendor shall not be obligated  hereunder  to                    
defend,  indemnify or hold harmless any Indemnitee from  any                    
such  loss, liability, damage, cost or expense which results                    
from  that  Indemnitee's misconduct or negligence.   Without                    
limiting  the  generality of the preceding sentence,  Vendor                    
agrees   to  obtain  and  maintain,  at  its  own   expense,                    
commercial  general  liability insurance  including  blanket                    
contractual liability and products liability coverages  with                    
minimum  limits of $1,000,000 per occurrence and $30,000,000                    
umbrella   coverage.   Such  insurance  shall  include   all                    
Indemnitees as additional insureds.  Within thirty (30) days                    
from the date of this Agreement, Vendor shall submit to  VHA                    
a  certificate  of insurance attested by a  duly  authorized                    
representative  of  the  insurance  carrier   or   carriers,                    
evidencing  that the insurance required is in force  and  in                    
effect  and  that  such insurance will not  be  canceled  or                    
materially  changed without giving VHA at least thirty  (30)                    
days  prior written notice.  Vendor's obligations to  obtain                    
and  maintain the required insurance and submit the required                    
certificate  of insurance to VHA shall continue  during  the                    
term of this Agreement and for five (5) years thereafter.                       

Furthermore,  Vendor shall defend, indemnify  and  hold               
harmless Indemnitees from and against any liability, damage,                    
cost   or  expense  arising  out  of  any  claim  of  patent                    
infringement made with respect to any Product.                                  

Section 12.    Returned Goods.  Vendor agrees to accept               
the return of Products in accordance with Vendor's currently                    
stated  policy;  provided, however, that  Vendor  agrees  to                    
accept  the return of Products delivered by Vendor in  error                    
or  in  a  damaged  condition without charge  and  for  full                    
credit.                                                                         

Section   13.      Product  Deletion.   Notwithstanding               
anything to the contrary contained in this Agreement, either                    
party  may delete any one or more of the Products from  this                    
Agreement  at any time, at will and without cause  upon  not                    
less than sixty (60) days prior written notice to Vendor.                       

Section  14.    Sole Source.  During the term  of  this               
Agreement,  VHA  shall not have in effect an agreement  with                    
any  other vendor for the rental of therapeutic beds.   This                    
provision does not apply to standard patient beds.                              

The  parties have caused this Agreement to be  executed               
and delivered by their respective authorized representatives                    
as of the date stated at the beginning of this Agreement.                       

     VOLUNTARY HOSPITALS OF AMERICA,
INC. ("VHA")              

By: /s/ WILLIAM J. ELLIOTT
           _______________________________
William J. Elliott  
 Senior Vice President
   Supply Chain Management

       KINETIC CONCEPTS, INC. ("Vendor")

By: /s/ SCOTT S. BROOKS   
            ________________________________
     Authorized Representative

Exhibit A               
to the                
Purchasing Agreement                
dated as of the 1st day of February, 1994,                
by and between                
Voluntary Hospitals of America, Inc.                
("VHA")               
and               
Kinetic Concepts, Inc.                
("Vendor")                

Redistribution.                                                                 

The  rental products covered by this Agreement are not  for         
resale or redistribution by VHA Members and Affiliates and cannot               
be  moved off-site without prior written consent of KCI Corporate               
office.   The rental products at all times shall remain the  sole               
property of KCI Therapeutic Services.                                           

Maintenance and Repair.                                                         

KCI  Therapeutic Services is responsible  for  all  routine         
maintenance  and  repair work performed on  rental  units  at  no               
additional charge to the hospital, unless the service problem has               
occurred  due to hospital's neglect or abuse.  If this  situation               
is present, current service and part rates will be charged.                     

Surrender.                                                                      

Upon  completion of an order or termination of  any  rental         
agreement,  KCI shall be entitled to the immediate possession  of               
any equipment.                                                                  

Returned Goods.                                                                 

No  purchased items will be accepted without prior  written         
authorization of KCI.  There will be a 15% restocking fee charged               
on  all  returns.  Damaged products, shipping and delivery errors               
are excluded from a restocking fee.                                             

Breach or Default.                                                              

If  a VHA Member or Affiliate does not pay the charges  due         
hereunder  or  breaches any of the terms and conditions  of  this               
Agreement,  ceases  doing business as  a  going  concern,  has  a               
petition  filed by or against it under any of the  provisions  of               
applicable  bankruptcy laws then in effect, makes  an  assignment               
for the property, KCI shall have the right to exercise any one or               
more  of  the following remedies in order to protect the interest               
of  KCI:   i) terminate this Agreement in whole or part;  or  ii)               
declare all unpaid charges to be immediately due and payable;  or               
iii)  take  possession of any or all items of Equipment,  without               
demand  or  notice,  and without liability to  Customer  for  any               
damages occasioned by such taking of possession.                                

Delivery, Transportation Charges.                                               

A  $130.00  delivery  charge  will  be  assessed  for  non-         
participating  VHA  hospitals that do  less  than  50%  of  their               
available surface dollars with KCI.                                             

EXHIBIT 10.19                                                                   

AmHS Purchasing Partners, L.P.                
Rental/Purchasing Agreement               

This  Rental/Purchase Agreement ("Agreement")  made  and  entered               
into as of April 1, 1993 by and between Kinetic Concepts, Inc., a               
Texas  Corporation  (herein  referred  to  as  "KCI"),  and   its               
subsidiary,  KCI  Therapeutic Services,  a  Delaware  Corporation               
(hereinafter   referred  to  as  "KCITS")  and  AmHS   Purchasing               
Partners,  L.P. (hereinafter collectively referred  to  as  "AmHS               
PP").   The  parties agree to the following terms and  conditions               
regarding the rental and sales of KCITS products.                               

AmHS  PP agrees to provide this agreement to the Limited Partners               
of  AmHS  PP  (hereinafter  referred to as  "Limited  Partners").               
KCITS  agrees  to  sell  and rent products  and  services  to  be               
facilities  (hereinafter  referred to  as  "member  facility"  or               
"member  facilities") owned, leased, managed  by,  or  affiliated               
with the Limited Partners participating in the AmHS PP program.                 

PRIMARY  PRODUCTS, ACCESSORIES, SERVICES.  The following products               
are covered by this Agreement:                                                  

A.   Therapeutic Patient Care Equipment                               

* KinAir, KinAir TC, KinAir III                             
* TheraPulse                                                
* BioDyne Continuous (Oscillating) Kinetic Therapy          
* Roto Rest Kinetic Treatment Table                         
* Risk Management Treatment Systems                         
* Fluid Air, FluidAir Plus                                  
* FirstStep Family of products, Q2Plus, DynaPulse,          
TheraRest                                               
* Underbed Scales                                           
* HomeKair Bed                                              

B.   Therapeutic Patient Care Equipment accessories  related          
to the products listed above                                

C.   Therapeutic Patient Care Equipment - Services                    

* Delivery and pick-up                                      
* Cleaning                                                  
* Maintenance and repair                                    
* Additional value services                                 

*The pricing terms and conditions for the aforementioned products               
are set forth on EXHIBITS "A", and ATTACHMENT "1", "2" and "3".                 

AmHS Purchasing Partners, L.P.                
Contract                

Conditions and Terms                

1.   Term of Agreement.                                                         

The  duration of this agreement will be 5 years  for  KCITS.          
The agreement is sole sourced.  Contract dates are April  1,          
1993,  through  March 31, 1998.  During  the  term  of  this          
agreement,  either  party may terminate  this  agreement  by          
serving 60 days written notice to the other party, certified          
receipt requested.                                                    

2.   Administrative Fees.                                                       

KCI will pay AmHS PP an administrative fee of 2% for all net          
KCITS rental and sales revenue.  The administrative fee will          
be  paid via check on a monthly basis and submitted to  AmHS          
PP  30  days  following  the end of the  month.   Additional          
administrative  and  marketing fees may  be  added  to  this          
program  from  time  to  time to  maximize  contract  growth          
performance  when  mutually  agreed  upon  by  all  parties.          
Payment will be sent via check made payable to AmHS  PP  and          
sent to the following lockbox address:                                

AmHS Purchasing Partners, L.P.                    
Dept 7650                                         
Los Angeles, CA  90084-7650                       

3.   Reporting.                                                                 

Provided  with  each  administrative  fee  payment  will  be          
supporting  rental and sales documentation  identifying  the          
calculations  made in determining the amount  of  each  such          
payment.  This documentation will be submitted both in  hard          
copy  form  and electronically on diskette.  Per request  of          
AmHS  PP,  KCI  will  make  an effort  to  move  toward  the          
utilization  of  the ANSI X.12 standard for electronic  data          
interchange (EDI).  Quarterly sales reports will be provided          
to each Limited Partner at their request.                             

4.   Pricing.                                                                   

All  KCITS prices are firm for the entire agreement  period.          
KCITS reserves the right to price competitively on a case by          
case basis to member facilities without affecting the entire          
AmHS  PP national agreement.  These pricing exceptions  will          
be  driven at the KCI Regional Vice President level and will          
be  subject to approval by KCI National Accounts,  AmHS  PP,          
and the Limited Partner.                                              

5.   Invoicing.                                                                 

Invoices shall be issued to member facilities.  All payments          
shall  be  made  to vendor by member facilities.   KCI  will          
collect from member facilities, and remit to the appropriate          
authority,  the  amount of any present or  future  tax  due.          
Taxes  include any federal, state, or local taxes applicable          
to  KCI  products sold.  All shipping is F.O.B. destination,          
prepaid and added.                                                    

6.   Billing and Payment Terms.                                                 

All  rental  payments are due NET 30 days.  All  KCITS  sale          
payments  are  due  2%/10 , NET 30 days.   Overdue  invoices          
shall bear the maximum rate of interest allowed by law.               

7.   Redistribution.                                                            

The  rental products covered by this agreement are  not  for          
resale or redistribution by member facilities and cannot  be          
moved  off  site  without  prior  written  consent  of   KCI          
Corporate office.  The rental products should remain at  all          
times the sole property of KCITS.                                     

8.   Maintenance and Repair.                                                    

KCITS  is responsible for all routine maintenance and repair          
work  performed on rental units at no additional  charge  to          
the hospital, unless the service problem has occurred due to          
member  facilities' neglect or abuse.  If this situation  is          
present, current service and part rates will be charged.              

9.   Insurance.                                                                 

KCI  currently has general/products liability  and  umbrella          
coverage  in  the  amount  of  thirty-one  million   dollars          
($31,000,000) aggregate limit.                                        

10.  Additional Products.                                                       

Additional products may be made subject to this agreement by          
the written consent of both parties.                                  

11.  Discontinued Products.                                                     

KCI   retains  the  rights,  in  its  sole  discretion,   to          
discontinue or modify any product.  Any product discontinued          
will  cease to be subject to this agreement.  KCI agrees  to          
notify  AmHS  PP  within 60 days of any  KCI  product  being          
discontinued.                                                         

12.  Surrender.                                                                 

Upon   completion  of  an  order  or  termination  of   this          
agreement, KCI shall be entitled to the immediate possession          
of any equipment.                                                     

13.  Publicity.                                                                 

AmHS  PP  agrees  to actively publicize the  terms  of  this          
agreement to Limited Partners and to help promote the rental          
of  and  purchases of KCITS products and services.  AmHS  PP          
will  designate an individual within AmHS PP to promote  and          
market  the  agreement.  AmHS PP will utilize  its  internal          
newsletter,  joint  mailings to  the  Limited  Partners  and          
members  facilities,  and advisory  committees  to  directly          
promote  and  market the agreement and  its  status  to  the          
Limited Partners.                                                     

14.  Returned Goods.                                                            

No  purchased items will be accepted for return without  the          
prior  written authorization of KCI.  There will  be  a  15%          
restocking  fee  charges  on  all  returns.   Shipping   and          
delivery errors are excluded from a restocking fee.                   

15.  Legal Action.                                                              

Should  any  suit  be  necessary for  KCI  to  enforce  this          
agreement, or to collect over due amounts pursuant  to  this          
agreement,  committed member facilities agree to  pay  KCI's          
reasonable attorney's fees and costs incurred by KCI in such          
enforcement.                                                          

16.  Social Security Act (Safe Harbors).                                        

AmHS  PP,  the Limited Partners and their members facilities          
are  aware of and will comply with Section 1128B(b)  of  the          
Social   Security  Act  (42  U.S.C.1320a-7b)  when   seeking          
reimbursement  from  any  government  entity  for   products          
supplied  under this agreement.  Specifically, AmHS  PP  and          
the Limited Partners and their member facilities acknowledge          
that  the  Act requires proper disclosure of any  discounts,          
rebates,  credits,  reimbursements and other  like  programs          
provided for herein.                                                  

17.  Breach or Default.                                                         

If  a member facility does not pay the charges due hereunder          
or  concern, has a petition filed by or against it under any          
of  the  provisions of applicable bankruptcy  laws  then  in          
effect, makes an assignment for the property, KCI shall have          
the  right  to  exercise any one or more  of  the  following          
remedies  in  order  to  protect the interest  of  KCI;  (1)          
terminate KCI's Agreement with the member facility in  whole          
or  part,  (2) declare all unpaid charges to be  immediately          
due and payable; (3) take possession of any or all items  of          
Equipment,  without  demand but with reasonable  notice  and          
without  liability  to  a member facility  for  any  damages          
occasioned by such taking of possession.                              

18.  Applicable Law.                                                            

This  agreement  is made under and will be  interpreted  and          
governed by Texas Law.  KCI shall be solely responsible  for          
compliance  with all Federal and State laws and  regulations          
applicable to its products and operations.                            

Acknowledgment.   By signing this agreement  the  individual          
signing below represents and acknowledges that they have the          
company power and authority to bind AmHS PP, to the terms of          
this Agreement.                                                       

Thie corporate agreement is being accepted by:                                  

AmHS Purchasing Partners, L.P.     Kinetic Concepts,Inc. (KCI)                  
(AmHS PP):                                                                      

/s/ LYNN DETLOR                    /s/ DENNIS E. NOLL                           
__________________________         _______________________                      
Lynn Detlor                        Dennis E. Noll                               
President, AmHS Purchasing         Vice President, General                      
Partners, L.P.                     Counsel and Secretary                        

May 8, 1995                        April 4, 1995                                
__________________________         _______________________                      
Date                               Date                                         

AmHS Purchasing Partners, L.P.                
Contract                

Programs and Services               

I.   GENERAL, KCI                                                               

1.   Health Economics Group.                                          

The  Health  Economics Group is  a  dedicated  team  of     
health  industry  financial  managers  and  consultants     
committed  to  assisting  our customers  in  maximizing     
reimbursement and cash flow and minimizing expenses  in     
the   areas   of  framed  and  non-framed   therapeutic     
surfaces,  mobile  rental equipment and  hospital  room     
furnishings.                                                

A  financial  consultant is available at no  charge  to     
member facilities.                                          

2.   KCITS Sales and Service Support.                                 

KCI  has  service centers throughout the United States,     
and  a  team  of  professional personnel  ranging  from     
Account   Executives,  Clinical  Consultants,   Service     
Technicians  as  well as Master Service Technicians  to     
serve   the   member   facilities.    This   team    of     
professionals gives KCITS the capability  of  providing     
services to most healthcare communities in hours.           

3.   KCI Financial Services.                                          

KCI  Financial  Services is our  in-house  leasing  and     
financial group.  In today's healthcare environment, it     
is  evident  that capital resources are  more  precious     
than  ever and that a flexible alternative to  outright     
purchase  can  be  very valuable to  a  hospital.   KCI     
Financial  Services  is  available  to  our  contracted     
customers  to provide, 1) Operating Leases, 2)  Capital     
Leases,  3)  Rent-to-own programs, and 4) to  structure     
customized financial services.                              

4.   Medical "Hot-Line" Program.                                      

The  KCI Medical Department, staffed with three  M.D.s,     
will   be   available   for   product   related   phone     
consultations 24 hours a day at 1-800-531-5346.             

II.  KCI THERAPEUTIC SERVICES (KCITS)                                           

1.   Limited Partner Administrative Fees.                             

KCI  will  pay those individual Limited Partners  a  1%     
administrative fee for all net KCITS rental  and  sales     
revenue  generated within those Limited Partners  which     
have  signed  a  Limited Partner Commitment  Form  (see     
Attachment  "1").   A  Limited  Partner  is  considered     
committed   when  80%  of  all  framed  and  non-framed     
therapeutic  surfaces business is  delivered  to  KCITS     
from   their   owned,   leased,  and   managed   member     
facilities.  This administrative fee will be  effective     
the   first  full  month  following  receipt   of   the     
commitment form at the KCI Corporate office.                

2.   Limited Partner Growth Administrative Fee.                       

KCI will pay each Limited Partner an administrative fee     
on annual incremental net sales growth for KCITS framed     
and  non-framed therapeutic surfaces utilization.  This     
fee  will be indexed on incremental net sales over base     
billings from the previous contract year.  The  initial     
base  year  calculations will be  from  April  1,  1994     
through March 31, 1995.                                     

The  index  for the Limited Partner Administrative  Fee     
Program is as follows:                                      

*    5-9%  incremental  growth     5%  annual  fee   of     
incremental net sales                                       
*    10-29%  incremental  growth   10%  annual  fee  of     
incremental net sales                                       
*    30-49%  incremental  growth   15%  annual  fee  of     
incremental net sales                                       
*    50%+  incremental  growth     20%  annual  fee  of     
incremental net sales                                       

This program ensures that each Limited Partner will  be     
rewarded  for  growth of KCITS utilization irrespective     
of its committed status.                                    

Every  contract year each Limited Partner will be given     
a  new base net sales level and incremental growth will     
be calculated for its annual administrative fee.            

This Limited Partner Growth Administrative Fee will  be     
paid directly to each qualifying Limited Partner within     
90  days  after  the  close of the  contract  year.   A     
summary  report of each Limited Partners of the  growth     
administrative fee payment will be generated  for  AmHS     
PP.                                                         

3.   Member Facility Bonus Program.                                   

KCI will bonus each committed* member facility directly     
through  a semi-annual credit based on dollars per  bed     
expenditures with KCITS.  This bonus program  commences     
when  a facility spends $250.00 per bed or more  on  an     
annualized  basis.   The tiered index  for  the  Member     
Facility Bonus Program is as follows:                       

*$250.00-$349.00 per bed annual expenditure  1% bonus       
*$350.00-$399.00 per bed annual expenditure  2% bonus       
*$400.00-$449.00 per bed annual expenditure  3% bonus       
*$450.00-$499.00 per bed annual expenditure  4% bonus       
*$500.00+                                    5% bonus       

A credit reflecting the facility bonus will be detailed     
on  the  actual facility invoice, and will be  executed     
within  60  days after each six-month contract  period.     
Beginning  at  six months, member facility  rental  and     
sales expenditures will be annualized and a credit will     
be calculated if dollars per bed meet or exceed $250.00     
per  bed.   The  percent credit will  reflect  a  bonus     
calculated  from  $250.00 per bed and  above.   When  a     
member facility reaches the $400.00 per bed expenditure     
level,  the  bonus will be calculated from dollar  one.     
Bed   calculations  will  be  a  combination   of   the     
participating  member facilities' acute and  long  term     
bed  count  listed  in  the current  AmHS  PP  Material     
Management Membership Portfolio report.  At the end  of     
each  contract  year,  actual  KCITS  dollars  per  bed     
expenditures  will be calculated and the annual  credit     
will reflect the balance between the annual actual  and     
the amount that was credited at six months.                 

A report of such credits generated will be forwarded to     
each   Limited  Partner  semi-annually  and  a  summary     
report, sub-totaled by Limited Partner and totaled  for     
all Limited Partners, will be sent to AmHS PP.              

*A member facility is considered committed when:            

1)    the  member  facility signs  a  KCI  Account
Commitment Form see Attachment 2) and,

2)    the  member facility delivers eighty percent
(80%) of all framed and non-framed    
therapeutic surface business to KCI.  

4.   Acute Care Member Facility Expense Capitation Program.           

KCITS commits to offer expense capitation programs  for     
KCITS  framed  and non-framed therapeutic  surfaces  to     
each   committed  acute  care  member  facility.    The     
objective of the expense capitation program is to lower     
therapeutic surface expenses for all acute care members     
through  the  implementation of appropriate therapeutic     
surfaces protocols and other cost saving measures.          

Toward  this end, KCITS is willing to accept reasonable     
risk   by   proactively  capping  therapeutic   surface     
expenses year to year.  This program will be considered     
successful  when  cost  savings  are  accompanied  with     
appropriate product utilization and clinical practices.     

Acute care member facilities planning to utilize any of     
the expense capitation programs must:                       

1)  sign  an  Account Commitment Form  (see  Attachment     
"2"),  and  2) complete an Expense Capitation Worksheet     
(see  Attachment "3").  The Expense Capitation  Program     
requires  a two (2) year mandatory commitment from  the     
acute  care  member  facility.  Any acute  care  member     
facility  on the Expense Capitation Program who  ceases     
to  do  business  with KCITS during the  two  (2)  year     
commitment period is subject to reimbursing  KCITS  for     
expenses  incurred during year one (1) of  the  Expense     
Capitation Program.  The expenses incurred would be the     
total  of  the non-billed therapy days utilized  during     
the Expense Capitation Program.                             

The  Expense  Capitation  Worksheet  will  be  mutually     
completed  by  both  the  acute  care  member  facility     
materials  management  and  a  KCITS  field  management     
representative.  The worksheet must reflect an accurate     
summary  of  the  hospital's prior  twelve  (12)  month     
therapeutic surface expense history.                        

4.   Expense Cap Program.                                             

Current Program:                                                      

KCITS  agrees  to cap committed acute care  members  to     
ninety  percent  (90%)  of the  prior  year's  baseline     
expenses.   This  current  expense  capitation  program     
begins  on  April 1, 1994, and ends on March 31,  1995.     
In  order  to run concurrently with the contract  year,     
the expense capitation program for 1995 will run twelve     
(12)  months  beginning April 1, 1995 and ending  March     
31, 1996.                                                   

If actual expenses are LESS than the expense cap at the     
conclusion  of  a  contract year,  the  lessor  of  the     
expense cap or actual expenses will be utilized in  the     
following  year's expense cap calculation.   If  actual     
expenses EXCEED the expense cap, KCITS will invoice the     
remaining  months of the contract at no charge.   A  no     
charge   invoice  will  allow  the  acute  care  member     
facility  to  monitor the impact  of  the  expense  cap     
program,  as  well  as manage Medicare,  Medicaid,  and     
other payor reimbursement regulations.                      

All  non-charged expenses will be added to the  expense     
cap  calculation  for  the  following  year  at  eighty     
percent (80%) of the non-charged total.                     

An example is as follows:                                   

Current Year Expense Cap      $200,000 per year         
Actual Expenses               $210,000 per year         
Expense Overage               $ 10,000                  

Subsequent Year Expense Cap Base $208,000 per year      
(200,000 + 80% of $10,000)                            

New Expense Cap               $187,200 per year         
($208,000 x 90%)                                      

Again, acute care member facilities which exceed  their     
set  expense  cap  will receive the  benefit  of  their     
utilization overage at no charge for that contract year     
only.   The subsequent year's expense cap will  reflect     
the  prior  year expense cap plus 80% of the no  charge     
overage.    Extraordinary   circumstances   that    may     
substantially  affect product mix  or  volume  must  be     
considered  in  establishing  a  fair  and  appropriate     
expense cap.  "Expense Cap" levels are subject to final     
approval of KCITS Corporate, Vice President of Sales.       

4.   Additional Expense Cap Programs.                                 

Additional   KCITS  Expense  Capitation  Programs   are     
available  to  each acute care member facility  who  is     
committed.   These programs are created and implemented     
based  on  each acute care member facilities' financial     
needs.  KCITS has the flexibility to adjust the Expense     
Capitation  Program each year on a case-by-case  basis.     
The  expense reductions or adjustments will be mutually     
agreed  upon  by the KCITS Regional Vice President  and     
the  acute  care member facility materials  management.     
All  expense  cap programs will begin on  April  1  and     
expire  on March 31st of every contract year.   Contact     
your  local  KCITS  representative for  information  on     
creating  a  customized expense capitation program  for     
your acute care member facility.                            

Exceptions,  Exclusion and Disclaimers to  Expense  Cap     
Program.                                          

a)   Alternate   Site   facilities   (including    Home     
placements)  are  excluded from this  expense  cap
program.                                          

b)   All  sale/purchase items current  and  future  are     
excluded from this expense cap program.           

c)   Any  competitive  product  conversions  that  move     
significant rental expenses to KCITS will  require
the  establishment of a new expense cap  based  on
the new volume assumptions.                       

d)   Acute care member facilities unfamiliar with KCITS     
or  specialty  therapeutic  surfaces  in  general,
consequently  having no historical  baseline  from
which  to establish a cap, will utilize a 12 month
trend.                                            

e)   New    technologies,   unrelated   to    specialty     
therapeutic  surfaces  are  excluded   from   this
expense cap program.                              

f)   Skilled  Nursing  Units  are  excluded  from  this     
expense  cap  program.  If an acute care  facility
utilizing  this  expense  capitation  program  has
exceeded  their  cap  and is  therefore  receiving
therapy days at no charge, billing must resume for
any patient who moves into a skilled nursing unit.
Once  that patient returns to an acute care  unit,
billings will be discontinued immediately.        

5.   Clinical Advantage Program.                                      

The CAP program is a clinical tracking software program     
that  allows clinical decision makers to make  informed     
decisions   concerning  the  utilization,  trends   and     
clinical outcomes associated with KCITS.  This  program     
produces  a semi-annual graphical report comparing  the     
member  facility against either national,  regional  or     
alike facility database.                                    

6.   Educational Workshops & Seminar Program.                         

KCITS  Kinetic  Therapy  and  Skin  Care  Seminars  are     
available through local Clinical Consultants  or  KCI's     
Department of Professional Education.  Kinetic  Therapy     
workshops  are approved for continuing education  units     
by the American Nurses Association.  (A $1,500.00 value     
provided at no charge).                                     

KCITS  provides  to  member facilities  four  education     
video-tapes  that provide CEUs for your nursing  staff.     
These review the following subjects:                        

-Anatomy and Physiology of Skin                             
-Pressure Ulcers                                            
-Prevention of Pressure Ulcers                              
-Care of the Patient Receiving Air Fluidized/Flotation      
System Therapy                                            

7.   Clinical Guidelines.                                             

KCITS   commits  to  provide  member  facilities   with     
published  clinical  guidelines concerning  the  proper     
utilization  of  our  support systems.   KCITS  further     
commits  to  assist  member  facilities  in  developing     
hospital  clinical  protocols  for  the  use  of  KCITS     
products.  Once established, KCITS will adhere  to  all     
such clinical protocols.                                    

From  and after April 1, 1995, whenever vendor has been     
notified  by a member facility of failure to  abide  by     
such  protocol, KCITS will promptly credit such  member     
facility as follows:                                        

(a)  For the first such failure, 5% the applicable
placement revenue;                      
(b)  For the second such failure, 10% thereof; and
(c)  For  the  third and each subsequent  failure,
100% thereof.                           

KCITS  shall only be required to provide such a  credit     
where  vendor  agrees that a significant violation  has     
occurred and where notification to vendor arises within     
30 days of alleged violation.                               

8.   Long Term Patients Program.                                      

KCI  is  offering all acute care member facilities  the     
availability  of  a  long-term patient  program.   This     
program  consists  of any continuous patient  placement     
utilizing  any  KCITS framed or non-framed  therapeutic     
surface for more than 120 days.  On the 121st day,  the     
hospital shall receive the surface (same therapy as the     
first  120  days)  at no charge for the  following  120     
days.   Billing  shall  resume on  day  241  up  to  an     
additional  120 days.  Billing must resume  immediately     
should a long term patient move from an acute care unit     
into  a skilled nursing unit.  The non-charged billings     
days will resume once that long term patient returns to     
the acute care unit.                                        

9.   Alternate Site Resource Program.                                 

KCI   currently  has  75  long  term  care  specialists     
supporting   the  KCITS  sales  force  in   the   early     
intervention, qualification, and transfer of acute care     
patients  to  less  costly  non-hospital  environments.     
This   team   works  closely  with  hospital  discharge     
planners,   social  workers,  and  case   managers   to     
transition   patients  smoothly   to   alternate   care     
locations.                                                  

10.  AmHS PP Alternate Site Program.                                  

KCITS  Alternate  Site  Business  Group  has  developed     
programs  designed  for  the  changing  alternate  site     
market  place.   Although each  alternate  site  member     
facility  can  utilize  the  AmHS  PP  Contract  Rental     
Pricing (refer to Exhibit A1), some facilities may need     
the   flexibility  of  KCITS  customized  pricing   and     
extended payment terms.                                     

KCITS  can develop for alternate site member facilities     
a  customized  package to meet their current  needs  as     
well  as  modify and adjust the package as those  needs     
change.   Additionally, KCITS offers an Alternate  Care     
Hotline  specifically for case managers with  questions     
regarding KCITS products and programs.                      

Through  KCITS  customized programs, member  facilities     
now  have  the  options  needed to  develop  individual     
programs  that will meet their specific  needs  in  the     
Alternate  Site care arena.  For additional information     
regarding  these  customized alternate  site  programs,     
please contact the local KCITS representative.              

AmHS Purchasing Partners, L.P.                
Contract Rental Pricing               

Exhibit "A1"                

PRODUCTS     RENTAL  AMHS PP  AMHS PP AMHS PP   LIST   AMHS PP              
LIST   RENTAL   % DISC.  LONG     SALE     SALE 
PRICE  PRICE**   FROM    TERM    PRICING PRICING
LIST    PRICE 
----------     ------  ------   -----   ------   ------   ------                
First Step     $38.00  $24.70     35%   $15.00   $4,900   $4,018                
----------------------------------------------------------------                
First Step     $43.00  $29.70     31%   $18.00   $7,875   $6,458                
Plus                                                                        
-----------------------------------------------------------------               
First Step     $45.00  $31.70     29%   $20.00   $8,375   $6,868                
MRS                                                                         
----------------------------------------------------------------                
First Step     $43.00  $31.70     26%   $20.00   $8,375   $6,868                
Heavy Duty                                                                  
----------------------------------------------------------------                
First Step     $45.00                   $26.00   $8,900   $7,298                
Select                                                                      
----------------------------------------------------------------                
Volume: $ 0          $32.00     28%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $31.00     31%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $30.00     33%                                           
----------------------------------------------------------------                
Q2 Plus        $75.00                   $57.00   $15,000 $11,890                
----------------------------------------------------------------                
Volume: $ 0          $70.00     6%                                          
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $65.00     13%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $60.00     20%                                           
----------------------------------------------------------------                
Dyna Pulse     $60.00                   $42.00   $14,000 $12,320                
----------------------------------------------------------------                
Volume: $ 0          $51.00     15%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $48.00     20%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $45.00     25%                                           
----------------------------------------------------------------                
KinAir         $90.00  $34.00     62%     N/A      N/A     N/A                  
----------------------------------------------------------------                
KinAir TC      $90.00                     N/A    $24,750 $20,295                
----------------------------------------------------------------                
Volume: $ 0          $46.75     48%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $43.35     51%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $42.50     52%                                           
----------------------------------------------------------------                
KinAir    III  $95.00                     N/A      N/A     N/A                  
without                                                                         
Scales                                                                          
----------------------------------------------------------------                
Volume: $ 0          $59.30     37%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $55.10     42%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $50.00     47%                                           
----------------------------------------------------------------                
KinAir III    $105.00                    N/A    $31,495 $25,826                 
with Scales                                                                     
----------------------------------------------------------------                
Volume: $ 0          $79.30     24%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $75.30     28%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $70.00     33%                                           
----------------------------------------------------------------                
HomeKair Bed   $1,500/ $1,500/    --    $1,500/    N/A     N/A                  
MO      MO               MO                       
----------------------------------------------------------------                
All products subject to availability.                                           

* Definition  of  Long-Term:  KCI will bill 30  days  at  a  time               
whether  the  product is used or not.  The product  remains  in             
the  hospital  at  all times for a minimum  of  90  days.   The             
serial  number that is assigned to this long-term  rental  must             
remain the same and match against the invoice serial number.                
**Pricing  for  acute care and alternate site member  facilities.               
Reference   page  13  for  alternate  site  member  facilities'             
customized programs and pricing.                                            

AmHS Purchasing Partners, L.P.                
Contract Rental Pricing               

Exhibit "A1" (Continued)                

PRODUCTS     RENTAL  AMHS PP  AMHS PP AMHS PP   LIST   AMHS PP              
LIST   RENTAL   % DISC.  LONG     SALE     SALE 
PRICE  PRICE**   FROM    TERM    PRICING PRICING
LIST    PRICE 
-----------    ------  -------  ------  -------  ------- -------                
FluidAir       $90.00                     N/A      N/A     N/A                  
----------------------------------------------------------------                
Volume: $ 0          $64.00     28%                                         
- 199,999                                                                       
----------------------------------------------------------------                
$200,000          $59.00     34%                                      
- 499,999                                                                       
----------------------------------------------------------------                
500,000+               $54.00     40%                                           
----------------------------------------------------------------                
FluidAir Plus  $120.00                    N/A      N/A     N/A                  
----------------------------------------------------------------                
Volume: $ 0          $64.00     46%                                         
- 199,999                                                                       
-----------------------------------------------------------------               
$200,000          $59.00     50%                                      
- 499,999                                                                       
-----------------------------------------------------------------               
500,000+               $54.00     55%                                           
-----------------------------------------------------------------               
TheraPulse     $135.00 $112.50    16%     N/A    $34,995 $28,696                
-----------------------------------------------------------------               
BioDyne        $160.00 $140.00    12%     N/A    $39,995 $32,796                
-----------------------------------------------------------------               
RotoRest Mark  $145.00                    N/A    $27,500 $22,550                
I                                                                               
-----------------------------------------------------------------               
Volume: $ 0          $94.35     34%                                         
- 199,999                                                                       
-----------------------------------------------------------------               
$200,000          $90.00     37%                                      
- 499,999                                                                       
-----------------------------------------------------------------               
500,000+               $85.55     41%                                           
-----------------------------------------------------------------               
Delta          $175.00 $160.00    8%      N/A    $43,500 $38,280                
RotoRest                                                                        
-----------------------------------------------------------------               
Burke Bed      $95.00  $57.60     39%     N/A      N/A     N/A                  
-----------------------------------------------------------------               
Bari 800i      $130.00 $90.00     30%     N/A    $21,000 $18,480                
-----------------------------------------------------------------               
BariKare       $160.00 $130.00    18%     N/A    $35,000 $30,800                
-----------------------------------------------------------------               
Bariatric      $40.00  $25.00     37%     N/A    $3,351   $2,949                
Accessories                                                                     
Package:                                                                        
-----------------------------------------------------------------               
Commode                                                                     
-----------------------------------------------------------------               
Walker                                                                      
-----------------------------------------------------------------               
Wheelchair                                                                  
-----------------------------------------------------------------               
PediKair       $155.00 $115.00    25%     N/A    $38,500 $33,880                
-----------------------------------------------------------------               
Underbed       $30.00  $10.00     66%     N/A      N/A     N/A                  
Scales                                                                          
-----------------------------------------------------------------               
Delivery       $130.00  Waive    100%   Waiver     N/A     N/A                  
-----------------------------------------------------------------               
Dri-Flo (Pkg.    N/A     N/A              N/A    $14.50   $7.83                 
of 12)                                                                          
-----------------------------------------------------------------               
(Case of 6)      N/A     N/A              N/A    $87.00   $46.98                
-----------------------------------------------------------------               
(Dri-Flo                                                                        
F.O.B.    San                                                                   
Antonio                                                                         
-----------------------------------------------------------------               
TheraRest                                                                       
Mattress:                                                                       
-----------------------------------------------------------------               
TheraRest        N/A     N/A              N/A    $306.00 $159.00                
Mattress  w/2                                                                   
year Warranty                                                                   
------------------------------------------------------------------              
TheraRest        N/A     N/A              N/A    $425.00 $209.00                
Mattress  w/5                                                                   
year Warranty                                                                   
------------------------------------------------------------------              
All products subject to availability.                                           
* Definition  of  Long-Term:  KCI will bill 30  days  at  a  time               
whether  the  product is used or not.  The product  remains  in             
the  hospital  at  all times for a minimum  of  90  days.   The             
serial  number that is assigned to this long-term  rental  must             
remain the same and match against the invoice serial number.                
**Pricing  for  acute care and alternate site member  facilities.               
Reference   page  13  for  alternate  site  member  facilities'             
customized programs and pricing.                                            

AmHS Purchasing Partners, L.P.                
Limited Partner               
Commitment Form               

Attachment "1"                

The   undersigned  Limited  Partner  hereby  agrees  to  use  KCI               
Therapeutic Services (KCITS) as its sole source provider for  all               
framed  and non-framed therapeutic surfaces.  This commitment  is               
part  of the master Agreement between KCI and AmHS PP dated April               
1,  1993.   This  commitment form is an  integral  part  of  that               
agreement.  All other terms and conditions are in accordance with               
that master agreement.                                                          

A Limited Partner is considered committed to KCITS when:                        

1)   The Limited Partner signs this Commitment Form.                  

2)   The Limited Partner delivers at least 80% of all framed          
and  non-framed therapeutic surface business  to  KCITS     
from   their   owned,   leased,  and   managed   member     
facilities.                                                 

KCI  will  pay each committed Limited Partner a 1% administrative               
fee  for all KCITS rental and sales revenue on a quarterly basis.               
(Details on page 2 of the Agreement.)                                           

Accepted by Limited Partner:       Accepted by KCITS:                           

__________________________    _________________________________                 
Limited Partner               Vice President, National Accounts                 

__________________________      _________________________________               
Signature                     Date                                              

__________________________                                                      
Title                                                                           

__________________________                                                      
Date                                                                            

AmHS Purchasing Partners, L.P.                
Account Commitment Form               

Attachment "2"                

This  member  facility  hereby  agrees  to  use  KCI  Therapeutic               
Services  (KCITS) as its sole source provider for all framed  and               
non-framed therapeutic surfaces.  This commitment is part of  the               
master  Agreement between KCI and AmHS PP dated  April  1,  1993.               
This  account  commitment  form  is  an  integral  part  of  that               
Agreement.   When completed, this sole source account  commitment               
form will entitle the member facility to participate in the KCITS               
committed  pricing levels Member Facility Bonus Program  and  the               
Expense  Capitation Program.  All other terms and conditions  are               
in accordance with that master Agreement.                                       

A member facility is considered committed to KCITS when:                        

1)   The member facility signs a Account Commitment Form.             

2)   The member facility delivers at least 80% of all framed          
and non-framed therapeutic surface business to KCITS.       

Member Facility:                        Accepted by KCITS:                      

_______________________       __________________________________                
Member Facility               General Manager                                   

_______________________       __________________________________                
Signature                     Region Vice President                             

_______________________       __________________________________                
Title                         Date                                              

_______________________                                                         
Date                                                                            

AmHS Purchasing Partners, L.P.                
Acute Care Member Facility                
Expense Cap Worksheet               

Attachment "3"                

__________________________         _____________________________                
Account Name, City, State          Effective Date                               

__________________________         _____________________________                
Completed by: Material Manager     Contract year (1-3)                          

__________________________         $______________________.00                   
Completed by: General Manager      Prior year Cap (if applicable)               

__________________________                                                      
Completed by: Region Vice                                                       
President                                                                       

I.   Framed and Non-Framed Therapeutic Surfaces Historical Data                 

Product Type                  #Therapy Days/year  Expense$            

Low air loss beds             ________________    ________            
Air Fluidized beds            ________________    ________            
Kinetic Therapy beds          ________________    ________            
Pulsation Therapy beds        ________________    ________            
Mechanical Mattress Overlays  ________________    ________            
Other                         ________________    ________            
Total                    ________________    ________       

Expense Cap Calculation                                               

Over or Under Prior Years Cap? (if applicable)                        
(See KCI Therapeutic Services (KCITS) Agreement                       
for additional calculations)                                          

Expense Cap Reduction (for Expense Capitation Program A)              
(Year 1 - 3 = 90% of total) ___________ x 90% = __________            

Expense Cap Reduction(for Expense Capitation Program B  and         
C)                                                                              
New Cap Assignment                 ________________                   

Recapture Clause                                                                

The  expense capitation program is an exclusive program with          
a  mandatory two (2) year commitment.  Any acute care member          
facility who ceases doing business with KCITS during the two          
(2)  year  expense  capitation program will  be  subject  to          
paying recaptured expenses incurred by KCITS.  Please  refer          
to Page 10 of the master Agreement.                                   

Return to Denise Voelkel, KCI Administration in San Antonio,                
Texas.                

EXHIBIT 10.20                                                                   

KINETIC CONCEPTS, INC.                
RACE Incentive Bonus Plan for Corporate Employees               
January - December 1994               

I.   Overview                                                                   
A.   The objectives of the Incentive Bonus Plan (IBP) are to          
*    Motivate participants to perform at peak levels,       
*    Motivate participants to make wise business            
decisions,                                        
*    Reward participants for their successes.               

The  IBP is designed to make participants think and act     
like owners.  As "Owners," participants will                
*    Take pride in their work,                              
*    Assume appropriate risk in making decisions,           
*    Accept responsibility for successes as well as         
failures,                                         
*    Incorporate short-term and long-term strategies.       

B.   The  IBP  is  based on RACE (Risk Adjusted  Controllable           
Earnings).    RACE  simulates  ownership,  and  rewards       
participants for creating value and penalizes them  for       
destroying value.                                             

C.   Participants  being compensated under this program  will           
be  fully informed of the provisions of the program and       
the  considerations which permit them to maximize their       
opportunities.                                                

II.  Definitions  -  Before proceeding, it  will  be  helpful  to               
define  various  terms  that will  be  used  throughout  the          
remainder of the IBP.                                                 
A.   RACE - RACE equals Controllable Earnings less the                
dollar   cost   of  capital.   In  other  terms,   when     
Controllable  Earnings  exceed  the  dollar   cost   of     
capital, value has been created.                            
B.   Controllable Earnings - Revenue minus  operating                 
expenses plus  goodwill  amortization  minus  taxes.        
C.   Capital - Amount invested in the business unit by                
the company.  For the purposes of RACE, capital             
includes accounts receivable,  inventories, and             
plant, property, and equipment.                             
D.   Cost of Capital - Cost of Capital for KCI adjusted               
division by division for each division's inherent           
risk.                                                       
E.   Dollar  Cost of Capital - Capital multiplied  by                 
Cost of Capital.                                            
F.   Note - Goodwill and goodwill amortization acquired               
prior to 1/1/94 is excluded from the calculation.           
Goodwill and goodwill amortization acquired                 
subsequent to 1/1/94 will be included.                      

Example of RACE Calculation               
Revenue                 $10,000               
Operating Expenses        5,000               
          ------
Net Opr Profit            5,000               
Taxes                     2,000               
          ------
Controllable Earnings     3,000               

Net Capital              $8,000               
Cost of Capital             15%               
           -----
$ Cost of Capital         1,200               

Controllable Earnings    $3,000               
$ Cost of Capital         1,200               
           -----
RACE                      1,800               
           =====
III. Maximizing RACE - There are three ways for an participant to               
maximize his/her RACE.                                                
A.   Earn more profit without using more capital.  The key            
is to increase revenues and/or decrease costs while         
employing the same amount of capital.                       
B.   Use less capital.  Find ways to run the business unit            
tighter and leaner.  For  example, Coca Cola switched       
from metal containers to plastic containers to ship its     
syrup in.                                                   
C.   Invest capital in high-return projects.   Grow  the              
business by investing additional capital in  projects       
that earn more than the cost of capital.                    

IV.  How the IBP Works                                                          
A.   Participation  -  Named participation  in  the  IBP  is          
restricted  to  key  management  positions,   generally     
defined as Vice President positions and above.              

Beyond  the  named  participant  group,  each  division     
president  and major department head will be  permitted     
to  distribute their RACE pool amongst key contributors     
in  their  organization for the  plan  year.  The  only     
restrictions are the following:                             

*  Hourly and commission eligible positions are not       
eligible for IBP participation.                     

*  IBP  payments will be recommended to an Executive      
Compensation  Committee  and reviewed  to  insure   
    non-discriminatory and equitable distribution within the
group based on individual contributions and level of
position.                                           

*   No IBP payments may be committed to any individual      
before final approval by the Executive              
Compensation Committee.                             

B.    Pay-for-Performance - The IBP is  intended  to  reward          
participants  for  performance.  Participants  will  take  a          
greater  interest  in  KCI's outcome if  they  believe  that          
they  can  influence  that  outcome.   They  will  obtain  a          
greater level of satisfaction if they believe that     their          
efforts will be recognized.  Critical to the      success of          
a  pay-for-performance plan are the  five       steps  which          
managers should follow:                                               
1.   Determine the criteria for participation (Managers     
are encouraged to include all eligible employees).
2.   Develop goals and objectives for each participant.     
Participants will take ownership of the goals and 
objectives if they help develop them.             
3.   Submit a list to Human Resources of: participants,     
goals and objectives for each participant, and    
anticipated bonus for each participant at 100% of 
KCI and individual performance.                   
4.   Communicate  goals  and  objectives   to   the         
participants.                                     
5.   Regularly review performance   with   the              
participants.                                     

C.   Bonus Pools - The bonus pool for Corporate Departments           
will be based on the actual results of Consolidated         
KCI.  The pools will be calculated as defined in the        
paragraph titled "Bonus Pool Calculation."   The rates      
used will be 7.5% for Rate 1 and 10% for Rate 2.   These    
rates are based on the current structure  of   KCI,   and   
are subject to change given a change in the structure       
of KCI.                                                     
D.   Bonus  Pool  Calculation - The bonus  pools  will  be            
calculated after the close of each fiscal   year.    The    
bonus pool's calculation is:                                

Bonus = (RACE x Rate 1) + (Change in RACE x Rate 2)     

The  first bonus component is based on the creation  of     
RACE.  RACE is multiplied by Rate 1, as long as RACE is     
greater  than  zero.   If RACE is negative,  then  this     
component is zero.                                          

The  second bonus component is the change in RACE  from     
one  year  to  the  next multiplied by  Rate  2.   This     
calculation  is  made whether the  change  in  RACE  is     
positive  or  negative.   If  the  change  in  RACE  is     
negative, the bonus pool will be charged for  the  loss     
in RACE.                                                    

If  RACE is negative, two things occur.  First, ALL  of     
the emphasis is placed on improving RACE.  Second, even     
though RACE is negative, a participant may earn a bonus     
as  long  as RACE improves.  The emphasis is placed  on     
improvement, and the participant is thus rewarded.          

Similarly, if RACE is positive but there is  a  decline     
in RACE from one year to the next, then the participant     
is  penalized for the decline in value created with the     
resources provided by investors.                            

E.   Unlimited  Contributions - The IBP has  no  floor  or            
ceiling caps.   This is in contrast to traditional bonus    
plans.  Typically, bonus plans provide for a minimum        
level of achievement that must be met (no bonus for         
performance below this level), a limited amount    of       
upside potential, and a capped bonus for "excellent"        
performance.                                                

CHART               

Unfortunately,  this  plan has  several  disincentives,     
including the temptation to concentrate losses  in  one     
year if it is obvious that no bonus will be earned, and     
the  temptation to "take it easy" if the maximum  bonus     
has already been achieved.                                  

Unlike   traditional  IBPs,  the  RACE   IBP   provides     
unlimited rewards for success and genuine penalties for     
failure.    If  KCI  performs  poorly  and  the   bonus     
calculation results in a negative bonus pool, then  the     
negative bonus pool reduces accumulated bonuses  banked     
into  the  banking system (See paragraph "Banking"  for     
details).                                                   

CHART               

Simply  stated,  participants  share  the  rewards  and     
penalties of the added/lost value with the investors.       

F.   Banking  - A portion of the annual bonus pools will  be          
put   into  a  "bank",  or  a  bonus  account  in   the     
participant's name.  The bonus pool will be broken into     
two  parts,  an "ordinary" bonus and an "extraordinary"     
bonus.   An  ordinary  bonus is defined  as  the  bonus     
earned  up  to 100% of targeted RACE.  An extraordinary     
bonus is defined as the bonus earned in excess of  100%     
of targeted RACE.  The ordinary bonus pool pays out the     
accumulated  bonus contributions over 3 years  (90%  in     
Year  1,  5%  in  Year  2, and  5%  in  Year  3).   The     
extraordinary bonus pool pays out the accumulated bonus     
contributions over 3 years (33% in Year 1, 33% in  Year     
2, and 33% in Year 3).  If the RACE calculation creates     
a  negative bonus pool, the negative bonus pool will be     
allocated  to  participants in the same proportions  as     
the bonus pool was paid out from the previous year.         

G.   Transfers,   Departures,  Etc.  -  If  the  participant          
transfers  within  the Company, the bank  account  goes     
with  him/her.  However, any bonus attributable to  the     
current  year will be paid from the bonus pool  of  the     
new  department  and  not from  the  pool  of  the  old     
department.  If the participant leaves the Company  for     
any reason, the account is forfeited.                       

H.    Partial Year Calculations - Participants leaving  the             
Company prior to year end will  forfeit their bonuses.      
New participants will receive a pro-rata bonus based on     
length of employment.                                       

I.    Form and Timing of Bonus Payment -                                
The  Bonus Pool will be calculated and provided to  the     
Division Presidents and department heads.  The Division     
Presidents  and department heads will then do  a  final     
allocation  of  their  Bonus Pools  to  the  their  IBP     
participants  and submit a listing to the  Compensation     
Committee for approval.  Bonuses will be paid  in  cash     
per  the  banking system after the close of the  fiscal     
year.                                                       

J.   Other  Incentive Plans - Other incentive plans  created          
by  Department  Heads  to incent participants  will  be     
netted out of the RACE Bonus Pool before the RACE Bonus     
Pool is allocated.                                          

EXHIBIT 10.21                                                                   
KINETIC CONCEPTS, INC.            
EMPLOYEE BENEFITS TRUST AGREEMENT             

THIS TRUST AGREEMENT is made and entered into as of this 1st day of             
September 1992, by and between Kinetic Concepts, Inc. ("KCI") and Keith         
D. Thatcher (the "Trustee").                                                    

WHEREAS, KCI has heretofore adopted the KCI MEDICAL PLAN (the           
"Plan") the purpose of which is to provide medical and other benefits           
for those employees of KCI and their eligible dependents who are                
covered by the Plan after meeting the service and other requirements            
described in the Plan;                                                          

WHEREAS, a Plan Administrator and a Claims Administrator have been      
appointed to administer the Plan and the claims thereunder;                     

WHEREAS, the funds which will be contributed to the Trust, as and       
when received by the Trustee will constitute a trust fund and any               
securities, instruments of indebtedness or other property acquired with         
such funds (the "Trust Fund") to be held for the benefit of the                 
employees and their eligible dependents under and in accordance with            
the Plan;                                                                       

WHEREAS, KCI intends that the Trust hereby established, when taken      
together with the Plan, shall constitute a "Voluntary Employees'                
Beneficiary Association" under Section 501(c)(9) of the Internal                
Revenue code of 1986; and                                                       

WHEREAS, KCI desires the Trustee to hold and administer the Trust       
Fund, and the Trustee is willing to hold and administer such Trust              
Fund, pursuant to the terms of this Agreement.                                  

NOW, THEREFORE, in consideration of the premises and of the mutual      
covenants contained herein, KCI and the Trustee agree as follows:               

ARTICLE I - CONTRIBUTIONS                                               

1.1  Receipt of Contributions.  The Trustee shall receive any           
contributions paid to it in cash or in the form of such other property          
as it may from time to time deem acceptable and which shall have been           
delivered to it.  All contributions so received, together with the              
income therefrom and any other increment thereon shall be held,                 
invested, reinvested and administered by the Trustee pursuant to the            
terms of this Agreement without distinction between principal and               
income.  The Trustee shall not be responsible for the calculation or            
collection of any contribution under the Plan, but shall be responsible         
only for property received by it pursuant to this Agreement.                    
1.2  Compliance with Laws.  The Plan, this Agreement and the Trust      
Fund thereunder shall meet all the requirements of Section 501(a) of            
the Internal Revenue Code, and the Employee Retirement Income Security          
Act (ERISA) of 1974, as amended.                                                

ARTICLE II - PAYMENTS FROM TRUST FUND                                   

2.1  Payments Directed by Plan Administrator.  The Trustee shall        
from time to time at the Plan Administrator's direction make payments           
out of the Trust Fund to the Claims Administrator in such amounts and           
for such purposes as may be specified in the Plan Administrator's               
directions.  To the extent permitted by law, the Trustee shall be under         
no liability for any payment made pursuant to the direction of the Plan         
Administrator.  Any direction of the Plan Administrator shall                   
constitute a certification that the distribution or payment so directed         
is one which the Plan Administrator is authorized to direct.                    
2.2  Impermissibility of Diversion.  It shall be impermissible for      
any part of the Trust Fund to be used for, or diverted to, any purpose          
other than to provide the permissible benefits of life benefits, sick           
and accident benefits, and other benefits similar to life, sick and             
accident benefits if it is intended to safeguard or improve the health          
of a member or members dependents and contemplated under the Plan for           
the exclusive benefit of covered employees and their dependents, except         
that any taxes and administration expenses for which the Trust is               
liable, may be made from the Trust Fund as provided for herein.                 

ARTICLE III - INVESTMENTS                                               

3.1  General.  The Trustee shall invest and reinvest the principal      
and income of the Trust Fund and keep the Trust Fund invested, without          
distinction between principal and income, in such securities or in such         
property, real or personal, tangible or intangible, as the Trustee              
shall deem advisable, including but not limited to insurance policies,          
stock, common or preferred, trust and participation certificates,               
interest in investment companies whether so-called "open-end mutual             
funds" or "closed-end mutual funds", leaseholds, fee titles, bonds, or          
notes and mortgages, and other evidences of indebtedness or ownership,          
irrespective of whether such securities or such property shall be of            
the character authorized by any state law from time to time for trust           
investments; provided, however, that investments shall be so                    
diversified as to minimize the risk of large losses unless under the            
circumstances it is clearly prudent not to do so in the sole judgment           
of the Trustee.                                                                 
3.2  Establishment of Funding Policy.  The Plan Administrator           
shall, pursuant to the Plan, establish and carry out a funding policy           
consistent with the purposes of the Plan and the requirements of                
applicable law, as may be appropriate from time to time.  As part of            
such funding policy, the Plan Administrator shall from time to time             
direct the Trustee to exercise its investment discretion so as to               
provide sufficient cash assets in an amount determined by the Plan              
Administrator, under the funding  policy then in effect, to be                  
necessary to meet the liquidity requirements of the administration of           
the Plan.                                                                       
3.3  Trustee's Adherence to Funding Policy.  The Trustee's              
discretion in investing and reinvesting the principal and income of the         
Trust Fund shall be subject to the funding policy, and any changes              
thereof from time to time, as the Plan Administrator may, pursuant to           
the Plan, adopt from time to time and communicate to the Trustee in             
writing.  The Trustee shall have the duty to act strictly in accordance         
with such funding policy, and any changes therein, as so communicated           
to the Trustee from time to time in writing.                                    

ARTICLE IV - POWERS                                                     

4.1  Powers.  The Trustee in addition to the power and authority          
granted to it under common law, statutory authority, and other                  
provisions of this Agreement, shall have the following power and                
authority, to be exercised in the Trustee's sole discretion:                    
(a)  To purchase, or subscribe for, any securities or other   
property and to retain the same in trust;                                       
(b)  To sell, exchange, convey, transfer, grant options to    
purchase, or otherwise dispose of any securities or other property held         
by the Trustee on behalf of the trust, by private contract or at public         
auction;                                                                        
(c)  To exercise the voting rights of any securities held by  
the trust; to grant general or special proxies or powers of attorney            
with or without power of substitution; to exercise any conversion               
privileges, subscription rights, or other options, and to make any              
payments incidental thereto; to oppose, or to consent to, or otherwise          
participate in, corporate reorganizations or other changes affecting            
corporate securities, and to delegate discretionary powers, and to pay          
any assessments or charges in connection therewith; and generally to            
exercise any of the powers of an owner with respect to stock, bonds,            
securities or other property held as part of the Trust Fund;                    

(d)  To cause any securities or other property held as part of
the Trust Fund to be registered in the Trustee's name or in the name of         
one or more of the Trustee's nominees, and to hold any investments in           
bearer form, (provided, however, that the books and records of the              
Trustee shall at all times show that all such investments are part of           
the Trust Fund);                                                                
(e)  To borrow or raise money for the purposes of the Trust in
such amount, and upon such terms and conditions, as the Trustee shall           
deem advisable; and for any funds so borrowed, to issue a promissory            
note as Trustee, and to secure the repayment thereof by pledging all,           
or any part, of the Trust Fund;                                                 
(f)  To keep such portion of the Trust Fund in cash or cash   
balances as the Trustee may, from time to time, deem to be in the best          
interest of the Trust created hereby, without liability for interest            
thereon;                                                                        
(g)  To accept and retain for such time as it may deem        
advisable any securities or other property received or acquired by it           
as Trustee hereunder, whether or not such securities or other property          
would normally be purchased as investments hereunder;                           
(h)  To make, execute, acknowledge, and deliver any and all   
documents of transfer and conveyance and any and all other instruments          
that may be necessary or appropriate to carry out the powers herein             
granted;                                                                        
(i)  To settle, compromise, or submit to arbitration any      
claims, debts, or damages to, or owing to or from, the Trust Fund, to           
commence or defend suits or legal or administrative proceedings, and to         
represent the Trust Fund in all suits and legal administrative                  
proceedings;                                                                    
(j)  To employ suitable agents and counsel and to pay their   
reasonable expenses and compensation, (who may, but need not be, KCI's          
agents or counsel);                                                             
(k)  To acquire real estate by purchase, exchange, or as the  
result of any foreclosure,liquidation, or other salvage as the                  
investment previously made hereunder; to hold such real estate in such          
manner and upon such terms as the Trustee may deem advisable; and to            
manage, operate, repair, develop, improve, partition, mortgage, or              
lease for any term or terms of years any such real estate or any other          
real estate constituting a part of the Trust Fund, upon such terms and          
conditions as the Trustee deem proper, using other Trust assets for any         
of such purposes if deemed advisable;                                           
(l)  To invest funds of the Trust Fund in night deposits or   
savings accounts;                                                               
(m)  To invest in Treasury Bills and other forms of United    
States government obligations;                                                  
(n)  Except as hereinafter expressly authorized, the Trustee  
is prohibited from selling or purchasing stock options.  The Trustee            
are expressly authorized to write and sell call options under which the         
holder of the option has the right to purchase shares of stock held by          
the Trustee as part of the assets of this Trust, if such options are            
traded on and sold through a national securities exchange registered            
under the Securities Exchange act of 1934, as amended, which exchange           
has been authorized to provide a market for option contracts pursuant           
to rules promulgated under such Act, and so long as the Trustee at all          
times up to and including the time of exercise or expiration of any             
such option holds sufficient stock in the assets of this Trust to meet          
the obligations under such option if exercised.  In addition, the               
Trustee is expressly authorized to purchase and acquire call options            
for the purchase of shares of stock covered by such options if the              
options are traded on and purchased through a national securities               
exchange as described in the immediately preceding sentence, and so             
long as any such option is purchased solely in a closing purchase               
transaction, meaning the purchase of an exchange traded call option the         
effect of which is to reduce or eliminate the obligations of the                
Trustee with respect to a stock option contract or contracts which it           
has previously written and sold in a transaction authorized under the           
immediately preceding sentence;                                                 
(o)  To deposit monies in federally insured savings accounts  
or certificates of deposit in banks or savings and loan associations;           
(p)  To do all such acts, take all such proceedings, and      
exercise all such rights and privileges, although not specifically              
mentioned herein, as the Trustee may deem necessary to administer the           
Trust Fund, and to carry out the purposes of this Trust.                        
4.2  More Than One Trustee.  If there shall be more than one              
Trustee, they shall act by a majority of their number, but may                  
authorize any one or more of them to sign papers and instruments on             
their behalf.                                                                   
4.3  Fees and Expenses.  The Trustee may be paid such reasonable        
compensation as shall from time to time be agreed upon in writing by            
KCI and The Trustee.  An individual serving as Trustee who already              
receives full-time pay from KCI shall not receive compensation from             
this Trust except for reimbursement of expenses properly and actually           
incurred.  In addition, the Trustee shall be reimbursed for any                 
reasonable expenses, including reasonable counsel and accounting fees,          
incurred by the Trustee in the administration of the Trust Fund.  Such          
compensation and expenses shall be paid from the Trust Fund.  All taxes         
of any kind and all kinds whatsoever that may be levied or assessed             
under existing or future laws upon, or in respect of, the Trust Fund or         
the income thereof shall be paid by the Trustee from the Trust Fund.            

ARTICLE V - TRUSTEE'S DUTIES                                            

5.1  General.  The Trustee shall discharge its duties under this        
Agreement solely in the interest of the employees covered under the             
Plan and their dependents and for the exclusive purpose of providing            
benefits to such persons and defraying reasonable expenses of                   
administering the Trust.  In doing so, the Trustee shall act with the           
care, skill, prudence and diligence under the circumstances then                
prevailing that a prudent man acting in a like capacity and familiar            
with such matters would use in the conduct of an enterprise of a like           
character and with like aims.  The Trustee shall diversify the                  
investments of the Trust so as to minimize the risk of large losses,            
unless under the circumstances it is clearly prudent not to do so.  The         
Trustee shall discharge its duties in accordance with the provisions of         
this Agreement insofar as they are consistent with the provisions of            
the Employee Retirement Income Security Act of 1974, as this Agreement          
and the said Act may be from time to time amended; but the duties and           
obligations of the Trustee as such shall be limited to those expressly          
imposed upon by this Agreement.                                                 
5.2  Consultation and Indemnification.  The Trustee may consult         
with counsel and the Trustee shall not be deemed imprudent by reason of         
its taking or refraining from taking any action in accordance with an           
opinion of counsel.  KCI agrees, to the extent permitted by law, to             
indemnify and hold the Trustee harmless from and against any liability          
that the Trustee may incur in the administration of the Trust Fund,             
unless arising from the Trustee's own willful breach of the provisions          
of this Agreement by his gross negligence, bad faith or fraud.  The             
Trustee shall not be required to give any bond or any other security            
for the faithful performance of its duties under this Agreement, except         
such as may be required by a law which prohibits the waiver thereof.            
5.3  Accounts and Records.  The Trustee shall keep accurate and         
detailed accounts of all investments, receipts, disbursement, and other         
transactions hereunder and all such accounts and other records relating         
thereto shall be open to inspection and audit at all reasonable times           
by any person designated by the Plan Administrator or KCI.  The Trustee         
shall furnish to the Plan Administrator a written statement of account          
within 60 days after the end of the Plan's year end setting forth all           
receipts and disbursements.  The Plan Administrator shall advise the            
Trustee of his approval or disapproval of the statement of account.             
Failure by the Plan Administrator to disapprove any such statement of           
account within 30 days after its receipt thereof shall be deemed                
approval thereof.  The approval by the Plan Administrator of the                
statement of account shall serve to release and discharge the Trustee           
from any liability or accountability to KCI as respect to the property          
of the Trustee's acts or transactions shown in the statement of                 
account, except with respect to any acts or transactions as to which            
the Plan Administrator shall file written objections with the Trustee           
within the 30-day time period prescribed.                                       
5.4  Limitation on Trustee's Liability.  The Plan Administrator         
shall administer the Plan as provided therein, and the Trustee shall            
not be responsible in any respect for administrating the Plan nor shall         
the Trustee be responsible for the adequacy of contributions to the             
Trust Fund to meet or discharge payments due or liabilities created,            
under the Plan.  The Trustee shall be entitled conclusively to rely             
upon any notice, instruction, direction or other communication of the           
Plan Administrator.                                                             

ARTICLE VI - RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE             

6.1  Resignation.  The Trustee may resign at any time by giving 30      
days' notice in writing to KCI.                                                 
6.2  Removal.  KCI may remove the Trustee at any time upon 30 days'     
notice in writing to the Trustee.                                               
6.3  Successor Trustee.  Upon the resignation or removal of the         
Trustee, KCI shall appoint a successor Trustee who shall have the same          
powers and duties as those conferred upon the Trustee hereunder.  Upon          
acceptance of such appointment by the successor Trustee, the Trustee            
shall assign, transfer, and pay over to such successor Trustee the              
funds and properties then constituting the Trust Fund.  The Trustee is          
authorized, however, to reserve such reasonable sum of money, as it may         
deem advisable, for payment of its fees and expenses in connection with         
the settlement of its account or otherwise, and any balance of such             
reserve remaining after the payment of such fees and expenses shall be          
paid over to the successor Trustee.                                             
6.4  Report by Trustee.  Within 60 days after the resignation or        
removal of the Trustee, the Trustee may furnish to the Plan                     
Administrator a written statement of account with respect to the                
portion of the year for which the Trustee served.  The Plan                     
Administrator shall advise the Trustee of his approval or disapproval           
thereof.  Failure by the Plan Administrator to disapprove any such              
statement of account within 30 days after its receipt thereof shall be          
deemed approval thereof.  The approval by the Plan Administrator of the         
statement of account shall serve to release and discharge the Trustee           
from any liability or accountability to KCI as respect to the property          
of the Trustee's acts or transactions shown in the statement of                 
account, except with respect to any acts or transaction as to which the         
Plan Administrator shall file written objections with trustees within           
the 30-day time period prescribed.                                              

6.5  Waiver of Notice.  In the event of any resignation or removal      
of the Trustee, the Trustee and KCI may in writing waive any notice of          
resignation or removal as may be provided hereunder.                            

ARTICLE VII - AMENDMENT AND TERMINATION OF AGREEMENT                    

7.1  Amendment.  Any or all of the provisions of this Agreement may     
be amended at any time and from time to time, in whole or in part, by           
an instrument in writing.  No such amendment shall authorize or permit          
any part of the Trust Fund (other than such part as is required to pay          
taxes and administration expenses) to be used for or diverted to                
purposes other than for the exclusive benefit of the employees and              
their dependents; no such amendment shall cause or permit any portion           
of the Trust Fund to revert to or become the property of KCI; and no            
such amendment which affects the rights or duties of the Trustee may be         
made without the Trustee's written consent.                                     
7.2  Termination.  This Agreement may be terminated at any time by      
KCI, and upon such termination, or upon the dissolution or liquidation          
of KCI, the Trust Fund shall be paid out by the Trustee as and when             
directed by the Plan Administrator or KCI, in accordance with the               
provisions of Article II hereof and the terms of the Plan.                      

ARTICLE VIII - GENERAL                                                  

8.1  Source of Funds.  This Trust shall constitute the sole source    
of funds which may be used to pay the medical and other benefits                
awarded under the Plan, and KCI shall not be liable in any way or in            
any manner for any such medical and other benefits or medical and other         
benefit payments beyond those monies which have been contributed to             
this Trust.                                                                     
8.2  Limited Effect of Plan and Trust.  Neither the establishment     
of the Plan nor the Trust nor any modification thereof, nor the                 
creation of any fund or account, nor the payment of any medical                 
benefits, shall be construed as giving to any person covered under the          
Plan or other person any legal or equitable right against the Trustee,          
KCI, or any officer or employee thereof, except as may otherwise be             
provided in the Plan or in the Trust and as necessary to satisfy the            
requirements of Sections 501(c)(9), 125, 105 and 106 of the Internal            
Revenue Code and applicable sections of ERISA.  Under no circumstances          
shall the terms of employment of any employee be modified or in any way         
affected by the Plan or this Trust.                                             
8.3  Protective Clause.  Neither KCI nor the Trustee shall be         
responsible for the validity of any contract of insurance issued in             
connection with the Plan or Trust or for the failure on the part of the         
insurer to make payments provided by such contract, or for the action           
of any person which may delay payment or render a contract null and             
void or unenforceable in whole or in part.                                      
8.4  Construction of Trust.  This Trust shall be construed and          
enforced                                                                        
according to the laws of the State of Texas and all provisions hereof           
shall be administered according to the laws of such state.  If any              
provision of this Trust shall be held illegal or invalid for any                
reason, such determination shall not affect the remaining provisions of         
the Trust.                                                                      
8.5  Gender and Number.  Wherever any words are used herein in the      
masculine, feminine or neuter, they shall be construed as though they           
were also used in another gender in all cases where they would so               
apply, and whenever any words are used herein in the singular or plural         
form, they shall be construed as though they were also used in the              
other form in all cases where they would so apply.                              
8.6  Headings.  The headings and sub-headings of this Trust have        
been inserted for convenience of reference and are to be ignored in any         
construction of the provisions hereof.                                          

IN WITNESS WHEREOF, this Agreement has been executed to be              
effective the day and year first above written.                                 

ATTEST:                                 KINETIC CONCEPTS, INC.                  
                  PLAN ADMINISTRATOR

/s/ ROBERT A. WEHRMEYER                 /s/ LARRY P. BAKER                      
______________________________          ______________________________          
Robert A. Wehrmeyer                     Larry P. Baker                          
KCI                                     KCI                                     
Secretary                               Senior Director, Human                  
         Resources

       TRUSTEE

                     /s/ KEITH D. THATCHER
                               _______________________________
                 Keith D. Thatcher
   KCI
                              Vice President, Accounting and
         Treasurer

EXHIBIT 10.22                                                                   

September 19, 1994                                                              

Mr. Raymond R. Hannigan                                                         
146 Blackberry Drive                                                            
Stamford, CT 06903                                                              

Dear Ray:                                                                       

On behalf of KCI it is a pleasure to confirm the specific terms                 
and conditions of the position discussed with Dr. Jim Leininger                 
September 14.                                                                   

Position Title                President and Chief Executive                     
Officer             
Employment Status:            Regular full-time                                 
Base Salary:                  $20,833.34 per month                              
Automobile Allowance:         $1,000.00 per month                               
Immediate Supervisor:         Dr. James R. Leininger                            
   Chairman Of The Board
Assigned Department                                                             
and Work Location:          Executive Administration                        
8023 Vantage Dr.  
   San Antonio, TX 78230
Start Date:                   November 14, 1994                                 
Group Insurance Effective:    Ninety-one days after start                       
    date (Pending receipt of
enrollment forms)   

In addition to your base salary, you will be eligible to                        
participate in our RACE Incentive Bonus Plan with an annual                     
target bonus of $125,000.00, prorated for the remainder of                      
calendar year 1994.  Bonus payments are determined on both                      
individual contributions and Corporate financial performance and                
will be contingent upon you remaining in a bonus eligible                       
position through December 31, of each year a bonus is earned.                   

You will receive a grant of 560,000 non-qualified stock options                 
with an exercise price based on the fair market value at the                    
close of business as of the date of your agreement with Dr.                     
Leininger, September 14, 1994, subject to final approval of the                 
Key Contributor Stock Option Committee of the Board.  The options               
will vest at the rate of 25% at the end of your first year of                   
employment with the Company, another 25% the second year and 50%                
the third year.  All stock option grants are contingent upon                    
satisfactory completion of a comprehensive Stock Option Agreement               
and Plan which contains, among other things, provisions                         
concerning treatment of confidential information, exercise                      
rights, an arbitration agreement, and covenants not to compete.                 

To assist you with your pending relocation from Stamford,                       
Connecticut to San Antonio, Texas the Company will provide the                  
following:                                                                      

1.  You will receive a relocation allowance equivalent to 5% of                 
your base annual salary (less applicable taxes) to                      
accommodate all incidental expenses such as shipping or                 
transport of personal automobiles, auto registrations,                  
utility deposits, local license fees, etc.                              

2.  The Company will purchase your Stamford, CT home at a price                 
equivalent to the average value as determined by two                    
appraisals secured by the Company.  All subsequent costs                
related to the final disposition of the property will be                
borne by the Company.                                                   

3.  The Company will reimburse reasonable and customary real                    
estate closing costs for the purchase of your San Antonio               
residence.                                                              

4.  The Company will arrange for packing, transport and delivery                
of your household goods by a national freight carrier.                  
These services will be direct billed to the Company.                    

You will be provided four weeks paid vacation each July 1 to be                 
used in the subsequent twelve month period. Vacation allocations                
not used prior to June 30 of each year are forfeited.                           

You will be provided a corporate sponsored membership to the Club               
at Sonterra and monthly dues will be reimbursed through our                     
standard expense report procedures.                                             

In the event of separation of your employment for any reason                    
other than malfeasance or act of moral turpitude, you will be                   
provided a severance package equivalent to one year salary and                  
auto allowance.                                                                 

Consummation of this offer will be contingent upon mutual consent               
between yourself and Dr. Leininger regarding certain operating                  
issues and authorities which will be addressed at your next                     
meeting.  All employment offers are contingent upon satisfactory                
completion of our pre-employment screening, including INS                       
requirements and substance abuse testing.  Employment                           
relationships with KCI and its subsidiaries are at-will and may                 
be terminated by notification from either party at any time, with               
or without cause.  You will be eligible for future participation                
in our standard employment related benefit programs such as                     
vacations, education assistance, group insurances, etc.,                        
contingent upon your satisfaction of the eligibility or                         
enrollment requirements pertaining to those programs.                           

It is my sincere hope you will accept this opportunity and find                 
your experience with KCI to be personally and professionally                    
rewarding.  I look forward to a mutually prosperous working                     
relationship.                                                                   

Sincerely,                                                                      

KCI                              UNDERSTOOD AND AGREED                          

/s/ BIANCA RHODES                /s/ RAYMOND R. HANNIGAN  11/04/94              
______________________________   ______________________________                 
Bianca Rhodes                    Raymond R. Hannigan       DATE                 
Sr. Vice President, Finance and                                                 
Chief Financial Officer                                                         

/lc                                                                             

Enclosure                                                                       

EXHIBIT 10.23                                                                   

November 22, 1994                                                               

Mr. Christopher M. Fashek                                                       
16A Arney Road                                                                  
Remuera, Aukland, New Zealand                                                   

Dear Christopher:                                                               

On behalf of KCI it is a pleasure to confirm the employment offer               
we recently discussed. The specific terms and conditions of your                
new position will be as follows:                                                

Position Title                President, KCI Therapeutic                        
Services            
Employment Status:            Regular full-time                                 
Base Salary:                  $15,000.00 per month                              
Automobile Allowance:         $750.00 per month                                 
Start Date:                   February 1, 1995                                  
Group Insurance Effective:    Ninety-one days after start                       
    date (Pending receipt of
enrollment forms)   

In addition to your base salary, you will be eligible to                        
participate in our RACE Incentive Bonus Plan with an annual                     
target bonus of $72,000.00.  For 1995 you will have a minimum                   
guaranteed bonus of $36,000.00.  Payment of this guaranteed bonus               
will be contingent upon you remaining in this position through                  
January 31, 1996.  Subsequent bonus payments will be determined                 
on both individual and Corporate financial performance and will                 
be contingent upon you remaining in a bonus eligible position                   
through December 31, of each year for which the bonus is earned.                

You will be recommended to the Key Contributor Stock Option                     
Committee of the Board to receive a grant of 75,000 non-qualified               
stock options with an exercise price based on the fair market                   
value at the close of business as of the date of your acceptance                
of this offer, November 21, 1994 ($5.50). The options will vest                 
at the rate of 20% per year on each May 15 with the first vesting               
to be effective May 15, 1995.  All stock option grants contingent               

upon satisfactory completion of a comprehensive Stock Option                    
Agreement and Plan which contains, among other things, provisions               
concerning treatment of confidential information, exercise                      
rights, an arbitration agreement, and covenants not to compete.                 

You will be provided a full membership to the Club at Sonterra,                 
or reimbursement of up to $5,000.00 for purchase of an                          
alternative club membership of your choice.                                     

To assist you with your pending relocation from Aukland, New                    
Zealand to San Antonio, Texas the Company will provide the                      
following:                                                                      

1.  You will receive a relocation allowance equivalent to 5% of                 
your base annual salary (less applicable taxes) to                      
accommodate all incidental expenses such as auto                        
registrations, utility deposits, local license fees, etc.               

2.  The Company will reimburse reasonable and customary real                    
estate closing costs for the purchase of your San Antonio               
residence, excluding any points to by down a mortgage rate.             

3.  It is our understanding that your current employer will                     
arrange for packing, transport and delivery of your                     
household goods to the United States.  However if that is               
not the case, the Company will pay a national household                 
goods freight carrier to do so and these services will be               
direct billed to the Company.                                           

You will be allocated four weeks paid vacation effective July 1                 
of each year to be used in the subsequent twelve months. Any                    
vacation balance not used by June 30 of each year will be                       
forfeited.                                                                      

In the event KCI terminates your employment prior to February 1,                
1997  for any reason other than malfeasance or act of moral                     
turpitude, you will be provided a severance package equivalent to               
one year salary and auto allowance.                                             

If you find the above terms and conditions of employment                        
acceptable and agree with the above arbitration agreement, in                   
order to activate your payroll status you must complete the                     
appropriate signature blank below, and return the original to my                
attention.  A copy is includes for your retention.                              

It is my sincere hope you will find your experience with KCI to                 
be personally and professionally rewarding.  I look forward to a                
mutually prosperous working relationship.                                       

Sincerely,                                                                      

KCI                              UNDERSTOOD AND AGREED                          

/s/ RAYMOND R. HANNIGAN          /s/ CHRISTOPHER M. FASHEK                      
_____________________________   ______________________________                  
Raymond R. Hannigan              Christopher M. Fashek     DATE                 
President and Chief Executive                                                   
Officer                                                                         

/lc                                                                             

Enclosure                                                                       

EXHIBIT 10.24                                                                   
OPTION AGREEMENT                

THIS  OPTION  AGREEMENT  entered  into  this  21st  day  of         
November,  1994,  between  JAMES R. LEININGER  and  CECELIA  ANNE               
LEININGER   (the  "Optionors")  and  RAYMOND  R.  HANNIGAN   (the               
"Optionee").                                                                    

W I T N E S S E T H:                

WHEREAS, the Optionors are the owner and holder of  440,000         
shares of the Common Stock, par value $0.001 of KINETIC CONCEPTS,               
INC. ("KCI") (the "Option Shares"); and                                         

WHEREAS, the Optionee desires to purchase from the Optionors          
an  option  to  purchase the Option Shares  upon  the  terms  and               
conditions set forth herein and the Optionors desire to sell such               
an option;                                                                      

NOW  THEREFORE,  in consideration of the premises  and  the         
mutual covenants herein contained and Mr. Hannigan's agreement to               
join KCI as its CEO and President, the Optionors and the Optionee               
agree as follows:                                                               

1.   The Optionors do hereby grant and sell to the Optionee,          
upon  the  terms and conditions hereinafter stated, the exclusive               
right and option to purchase the Option Shares from the Optionors               
at a price of $5.74 per share.                                                  

2.    This  option will expire at 5:00 p.m.,  San  Antonio,         
Texas time, on November 15, 1997 (the "Exercise Date").                         

3.    This  option  may be exercised  by  the  Optionee  by         
delivering  written  notice  to  such  effect  (the  "Notice   of               
Exercise")  to the Optionors at any time, or from time  to  time,               
prior  to  the  time of expiration stated in  paragraph  2.   The               
Notice of Exercise shall specify the date and time of the closing               
and the number of shares to be exercised in the case of a partial               
exercise.   Each  closing  shall take place  at  the  offices  of               
Kinetic  Concepts, Inc. in San Antonio, Texas.  A form of  Notice               
of Exercise is attached hereto as Exhibit "A".  In the event of a               
partial  exercise, the Optionors shall retain  the  Notice(s)  of               
Exercise  and  maintain  them with  their  copy  of  this  Option               
Agreement  as an exercise history.  The Notice of Exercise  shall               
be deemed to be delivered when actually received by the Optionors               
(including  receipt of a facsimile transmission  thereof).   This               
Option  Agreement shall be of no further force and  effect  after               
the Exercise Date.                                                              

4.   If this option is exercised within the time and in the         
manner  herein  provided, the Optionors  shall  thereupon  become               
bound  to sell and the Optionors shall thereupon become bound  to               
purchase the Option Shares specified in the Notice of Exercise at               
the per share price specified in paragraph 1.  At the closing  of               
such  sale  and  purchase,  the Optionors  shall  instruct  KCI's               
transfer   agent   to   deliver  to  the  Optionee   certificates               
representing  the Option Shares.  The Optionee shall  deliver  to               
the  Optionors  the  Exercise Price  specified  in  a  Notice  of               
Exercise  in  the  form of a check payable to the  order  of  the               
Optionors.                                                                      

5.    The  Optionors represent and warrant to the  Optionee         
that:                                                                           

(a)   The Optionors are the legal and equitable  owner    
and holder of the Option Shares, free and clear of any lien,          
encumbrance, claim, security interest of any other  interest          
of a third party.                                                     

(b)   Upon  the  purchase of Option  Shares  from  the    
Optionors  pursuant to this Option Agreement,  the  Optionee          
will  receive  good  and marketable  title  to  such  Option          
Shares,  free  and  clear of any lien,  encumbrance,  claim,          
security interest or any other interest of a third party.             

6.   The Optionee acknowledges that he has been advised that          
the  Option  Shares have not been registered under the Securities               
Act  of  1933, as amended, or under the securities  laws  of  any               
other  jurisdiction.   The Optionors and the  Optionee  agree  to               
cooperate  in  complying with the requirements of all  securities               
laws  applicable  to the sale and purchase of the  Option  Shares               
hereunder.                                                                      

7.   Any notice hereunder by the Optionee shall be given to         
the  Optionors  in writing and such notice shall be  deemed  duly               
given  only  upon receipt hereof at the Optionors'  home  at  200               
Canada Verde, San Antonio, Texas 78232.                                         

8.   Time is of the essence of this Agreement.                      

9.    This  Agreement  may be executed  in  any  number  of         
counterparts, each of which shall be deemed an original, but  all               
of which together shall constitute one and the same instrument.                 

10.  This Agreement shall be binding upon and shall inure to          
the benefit of the parties hereto and their respective successors               
and assigns.                                                                    

EXECUTED on the date first above written.                             

OPTIONORS:                              OPTIONEE:                               

/s/ JAMES R. LEININGER, M.D.           /s/ RAYMOND R. HANNIGAN                  
________________________                _________________________               
JAMES R. LEININGER                      RAYMOND R. HANNIGAN                     

/s/ CECELIA ANNE LEININGER                                                      
________________________                                                        
CECELIA ANNE LEININGER                                                          

                               EXHIBIT "A"

                          February 1, 1995

James R. Leininger, M.D.                                                        
Cecelia Anne Leininger                                                          
200 Canada Verde                                                                
San Antonio, Texas  78232                                                       

                       Re:  Notice of Exercise

Dear Jim and Cecelia:                                                           

This  letter shall serve as notice to you that  I  wish  to         
exercise  the  options described below pursuant to  that  certain               
Option Agreement dated November 21, 1994 by and between James  R.               
Leininger and Cecelia Anne Leininger and myself.                                

Shares        Number of Shares    Exercise                
Available      To be Exercised      Price                   
---------      ----------------    --------                 
440,000            43,500          $5.74                  

In consideration for the exercise of this option, I have enclosed               
herewith  a check in the amount of $249,690.  Upon acceptance  of               
this  check,  it is my understanding that you will  direct  KCI's               
stock transfer agent to issue me a stock certificate representing               
the 43,500 shares of KCI's common stock which I have acquired  on               
this  date.   I  further understand that you will  maintain  this               
Notice  of  Exercise in your permanent files as  a  part  of  the               
exercise history of the Option Agreement.                                       

                          Sincerely yours,

                                 /s/ RAYMOND R. HANNIGAN
                                 _______________________
                             Raymond R. Hannigan

EXHIBIT 10.25                                                                   
OPTION AGREEMENT                

THIS OPTION AGREEMENT entered into this 23rd day of August,         
1995,  (the "Grant Date") between JAMES R. LEININGER and  CECELIA               
ANNE  LEININGER  (the  "Optionors") and  BIANCA  A.  RHODES  (the               
"Optionee").                                                                    

W I T N E S S E T H:                

WHEREAS, the Optionors are the owners and holders of 75,000         
shares of the Common Stock, par value $0.001 of KINETIC CONCEPTS,               
INC. ("KCI") (the "Option Shares"); and                                         

WHEREAS, the Optionee desires to purchase from the Optionors          
an  option  to  purchase the Option Shares  upon  the  terms  and               
conditions set forth herein and the Optionors desire to sell such               
an option;                                                                      

NOW  THEREFORE,  in consideration of the premises  and  the         
mutual covenants herein contained, the Optionors and the Optionee               
agree as follows:                                                               

1.   The Optionors do hereby grant and sell to the Optionee,          
upon  the  terms and conditions hereinafter stated, the exclusive               
right and option to purchase the Option Shares from the Optionors               
at a price of $9.125 per share (the "Option").                                  

2.   The option will expire at 5:00 p.m., San Antonio, Texas          
time, on August 23, 2000 (the "Expiration Date").                               

3.    Subject  to  the  vesting  provisions  set  forth  in         
paragraph  4 hereof, the option may be exercised by the  Optionee               
by  delivering  written  notice to such effect  (the  "Notice  of               
Exercise")  to the Optionors at any time, or from time  to  time,               
prior  to  the  time of expiration stated in  paragraph  2.   The               
Notice of Exercise shall specify the date and time of the closing               
and the number of shares to be exercised in the case of a partial               
exercise.   Each  closing  shall take place  at  the  offices  of               
Kinetic  Concepts, Inc. in San Antonio, Texas.  A form of  Notice               
of Exercise is attached hereto as Exhibit "A".  In the event of a               
partial  exercise, the Optionors shall retain  the  Notice(s)  of               
Exercise  and  maintain  them with  their  copy  of  this  Option               
Agreement  as an exercise history.  The Notice of Exercise  shall               
be deemed to be delivered when actually received by the Optionors               
(including  receipt of a facsimile transmission  thereof).   This               
Option  Agreement shall be of no further force and  effect  after               
the Expiration Date.                                                            

4.    The Option Shares shall vest in increments of  25,000         
Option  Shares  (1/3 of the original grant of Option  Shares)  on               
each  of  the  first three anniversaries of the Grant  Date.   No               
Option  Shares  may  be exercised which have not  vested  and  no               
Option  Shares shall vest after the termination of the Optionee's               
employment with KCI.                                                            

5.   If this option is exercised within the time and in the         
manner  herein  provided, the Optionors  shall  thereupon  become               
bound  to  sell and the Optionee shall thereupon become bound  to               
purchase  the  Option Shares specified in paragraph  1.   At  the               
closing  of such sale and purchase, the Optionors shall  instruct               
KCI's  transfer  agent  to deliver to the  Optionee  certificates               
representing  the Option Shares.  The Optionee shall  deliver  to               
the  Optionors  the  Exercise Price  specified  in  a  Notice  of               
Exercise  in  the  form of a check payable to the  order  of  the               
Optionors.                                                                      

6.    The  Optionors represent and warrant to the  Optionee         
that:                                                                           

(a)   The Optionors are the legal and equitable owners    
and  holders  of the Option Shares, free and  clear  of  any          
lien,  encumbrance, claim, security interest  or  any  other          
interest of a third party.                                            

(b)   Upon the purchase of the Option Shares from  the    
Optionors,  pursuant to this Option Agreement, the  Optionee          
will  receive  good  and marketable  title  to  such  Option          
Shares,  free  and  clear of any lien,  encumbrance,  claim,          
security interest or any other interest of a third party.             

7.   The Optionee acknowledges that he has been advised that          
the  Option  Shares have not been registered under the Securities               
Act  of  1933, as amended, or under the securities  laws  of  any               
other  jurisdiction.   The Optionors and the  Optionee  agree  to               
cooperate  in  complying with the requirements of all  securities               
laws  applicable  to the sale and purchase of the  Option  Shares               
hereunder.                                                                      

8.   Any notice hereunder by the Optionee shall be given to         
the  Optionors  in writing and such notice shall be  deemed  duly               
given  only  upon receipt hereof at the Optionors'  home  at  200               
Canada Verde, San Antonio, Texas 78232.                                         

9.   Time is of the essence of this Agreement.                      

10.   This  Agreement  may be executed  in  any  number  of         
counterparts, each of which shall be deemed an original, but  all               
of which together shall constitute one and the same instrument.                 

11.  This Agreement shall be binding upon and shall inure to          
the benefit of the parties hereto and their respective successors               
and assigns.                                                                    

EXECUTED on the date first above written.                             

OPTIONORS:                     OPTIONEE:                                        

/s/ JAMES R. LEININGER, M.D.   /s/ BIANCA A. RHODES                             
_____________________________  ________________________________                 
JAMES R. LEININGER             BIANCA A. RHODES                                 

/s/ CECELIA ANNE LEININGER                                                      
_______________________________                                                 
CECELIA ANNE LEININGER                                                          

EXHIBIT "A"                 

  _______________, 19___

James R. Leininger, M.D.                                                        
Cecelia Anne Leininger                                                          
200 Canada Verde                                                                
San Antonio, Texas 78232                                                        

Re:  Notice of Exercise                                               

Dear Jim and Cecelia:                                                           

This  letter shall serve as notice to you that I wish  to           
exercise the options described below, pursuant to that  certain                 
Option Agreement dated August 23, 1995 by and between James  R.                 
Leininger and Cecelia Anne Leininger and myself.                                

Shares         Number of Shares         Exercise            
Available       to be Exercised            Price              
---------       ----------------         --------             
_________        ___________             $9.125               

In  consideration  for  the exercise of  this  option,  I  have                 
enclosed  herewith  a check in the amount of  $_______________.                 
Upon acceptance of this check, it is my understanding that  you                 
will  direct  KCI's stock transfer agent to issue  me  a  stock                 
certificate  representing ___________ shares  of  KCI's  common                 
stock,   which  I  have  acquired  on  this  date.   I  further                 
understand  that you will maintain this Notice of  Exercise  in                 
your  permanent files as a part of the exercise history of  the                 
Option Agreement.                                                               

Sincerely yours,    

           _______________________________
Bianca A. Rhodes    

EXHIBIT 22.1                                                                    
KCI SUBSIDIARIES                

A.   Kinetic Concepts, Inc., a Texas corporation                                
(Tax ID #74-1891727)                                                  

Subsidiaries:                                                         

1.   KCI  Therapeutic  Services,  Inc.,  a  Delaware                  
corporation                                                 
(Tax ID #74-2152396)                                        

2.   KCI International, Inc., a Delaware corporation                  
(Tax ID #51-0307888)                                        

a.  KCI  Medical Canada Inc., a Canadian                    
corporation                                         

b.  Mediscus  International  Limited,  a                    
United Kingdom corporation                          

(i)   KCI Medical United Kingdom                    
Limited, a United Kingdom corporation   

c.  Mediscus Products Limited, a  United                    
Kingdom corporation                                 

(i)   Home-Care Medical Products                    
Limited, a United Kingdom corporation   

(ii)  KCII  Medical  Limited,  a                    
   United    Kingdom   corporation   (formerly
   Lingard Leasing Limited), [Lingard Plastics
Ltd. dissolved]                         

d.   KCI  Medical Holding GMBH (formerly)                     
KCI  Medical GmbH, a Federal Republic of Germany    
GmbH and (formerly KCI Handels GmbH)                

(i)  KCI Mediscus Produkte GmbH                     

(ii) KCI Therapy Products (Formerly Verwalt)        

e.   Equipement Medical KCI, S.A.R.L.,  a                     
French corporation                                  

f.   KCI Medical B.V., a Netherlands corporation              

g.   KCI-Mediscus AG, a Swiss corporation                     

h.   Mediscus medizinisch-technische Gerate                   
Handelsgesellschaft mbH Austria                     

i.   KCI   Europe  Holding  B.V.,  a  Netherlands             
corporation                                         

j.   KCI International-Virgin Islands,                        
Inc., a Virgin Islands corporation                  

k.   KCI  Medica  Espana,  S.A.,  a  Spanish                  
corporation                                         

l.   KCI Medical Australia PTY, Ltd.,  an                     
Australian corporation                              

m.   KCI  Medical  S.r.l.,  an  Italian                       
corporation                                         

[KCI-Mediscus    Klinikausstattung                  
Gesellschaft  mbH,  an  Austrian  corporation  -    
DISSOLVED IN 1994]                                  

3.   KCI Financial Services, Inc., a Delaware corporation             
(Tax ID #87-0490775)                                        

4.   KCI New Technologies, Inc., a Delaware corporation               
(Tax ID #74-2615226)                                        

5.   KCI Properties Limited, a Texas limited liability                
company, (Tax ID #74-2621178)                               

6.   KCI  Real  Property Limited,  a  Texas  limited                  
liability company, dba Premier Properties (Tax ID #74-      
2644430)                                                    

7.   Medical Retro Design, Inc., a Delaware corporation               
(Tax ID #74-2652711)                                        

8.   KCI   Clinical  Systems,  Inc.,   a   Delaware                   
corporation (Tax ID #74-2675416)                            

SIGNATURES        

Pursuant to the requirments of Section 13 or 15(d) of the Securities            
Exchange Act of 1934, the registrant has duly caused this report to             
be signed on its behalf by the undersigned, thereunto duly authorized,          
in the City of San Antonio, State of Texas on January 23, 1996.                 

                  KINETIC CONCEPTS, INC.

                    By: /s/ JAMES R. LEININGER, M.D.
                        ----------------------------
                    James R. Leininger, M.D.
                    Chairman of the Board of
     Directors

Pursuant to the requirements of the Securities Exchange Act of 1934,            
as amended, this Registration Statement has been signed below by the            
following persons on behalf of the registrant and in the capacities             
and on the dates indicated.                                                     

Signature                              Date                     
---------                             ------                    

KINETIC CONCEPTS, INC.                                                          

By: /s/ JAMES R. LEININGER, M.D.              January 23, 1996                  
----------------------------                                            
James R. Leininger, M.D.                                                
Chairman of the Board of                                                
Directors                                                               

By: /s/ RAYMOND R. HANNIGAN                   January 23, 1996                  
----------------------------                                            
Raymond R. Hannigan                                                     
Chief Executive Officer and                                             
President                                                               

By: /s/ BIANCA A. RHODES                      January 23, 1996                  
----------------------------                                            
Bianca A. Rhodes                                                        
Chief Financial Officer and                                             
Senior Vice President                                                   
(Principal Accounting Officer)                                          

  SIGNATURES (CONTINUED)

Signatures                              DATE                    
----------                             ------                   

By: /s/ PETER A. LEININGER, M.D.               January 23, 1996                 
-------------------------------                                         
Peter A. Leininger, M.D.                                                
Director                                                                

By: /s/ SAM A. BROOKS                          January 23, 1996                 
-------------------------------                                         
Sam A. Brooks                                                           
Director                                                                

By: /s/ FRANK A. EHMANN                        January 23, 1996                 
--------------------------------                                          
Frank A. Ehmann                                                           
Director                                                                  

By: /s/ BERNHARD T. MITTEMEYER, M.D.           January 23, 1996                 
---------------------------------                                         
Bernhard T. Mittemeyer, M.D.                                              
Director                                                                  

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-K/A’ Filing		Date		Other Filings
		8/23/00
		3/31/98		10-K,  10-Q
		11/15/97
		2/28/97
		2/1/97
		3/31/96		10-Q
		1/31/96
Filed on:		1/23/96
		1/19/96
		9/30/95		10-Q
		8/23/95
		8/21/95
		6/30/95		10-Q
		6/15/95
		5/15/95		10-Q
		5/8/95
		4/4/95
		4/1/95
		3/31/95		10-Q,  DEF 14A
		2/14/95
		2/1/95
For Period End:		12/31/94		10-K
		11/22/94
		11/21/94
		11/14/94
		10/17/94		8-K
		9/30/94		10-Q,  8-K
		9/19/94
		9/14/94
		4/1/94
		3/1/94
		2/1/94
		4/1/93
				List all Filings