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
