Exhibit 10.49

Executive Retention Agreement

This Executive Retention Agreement (the "Agreement") is effective as of
July 2009 (the "Effective Date"), by and between Michael C. Genau (the
"Executive"), and Kinetic Concepts, Inc. ("KCI" or the "Company") (together the
"Parties").

RECITALS

WHEREAS, the Executive has accepted employment with the Company as President,
Global VAC and has significant strategic and management responsibilities
necessary to the continued successful operation of the Company’s business;

WHEREAS, the Board of Directors of the Company (the "Board") has determined that
it is in the best interests of the Company and its stockholders to assure that
the Company will have the continued dedication and objectivity of the Executive;

WHEREAS, the Board believes that it is imperative to provide the Executive with
certain severance benefits upon the Executive’s termination of employment under
the circumstances described herein that provide the Executive with the financial
incentive and encouragement necessary to remain with the Company on a long-term
basis.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
Parties agree as follows:

1. Term of Agreement.  The Company and the Executive agree that this Agreement
will be in effect from the Effective Date until the termination of the
Executive's employment with the Company as set forth in Section 2 herein.
 
2. At-Will Employment.  While this Agreement is in effect, the Executive's
employment with the Company shall continue to be at-will and, as such, may be
terminated by the Executive or the Company at any time, for any reason and with
or without advance notice, subject to the Company's severance obligations set
forth herein.
 
3. Definition of Terms.  The following terms referred to in this Agreement shall
have the following meanings:
 
(a) Change in Control.  A Change in Control means the first to occur of any one
of the following events: (i) consummation of any sale, lease, exchange, or other
disposition (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Company (together with the assets of the
Company's direct and indirect subsidiaries) to any Person or group of related
Persons, as that term is used in Section 13(d) of the Exchange Act (a "Group"),
together with any affiliates thereof; or (ii) any Person or Group becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of Shares representing more than 50% of the aggregate voting
power of the issued and outstanding stock entitled to vote in the election of
directors of the Company; or (iii) the shareholders of the Company approve a
plan of complete liquidation or dissolution of the Company.
 
(b) Qualifying Termination.  A "Qualifying Termination" shall mean the
Executive's (i) termination of employment by the Company without "Cause;" or
(ii) the Executive's resignation from employment for "Good Reason."
 
(c) Cause.  "Cause" shall mean conduct involving one or more of the
following:  (i) the substantial and continuing failure of the Executive to
render services to the Company or any subsidiary or affiliate in accordance with
the Executive’s obligations and position with the Company, subsidiary or
affiliate; provided that the Company or any subsidiary or affiliate provides the
Executive with adequate notice of such failure and, if such failure is capable
of cure, the Executive fails to cure such failure within 30 days of the notice;
(ii) dishonesty, gross negligence, or breach of fiduciary duty; (iii) the
Executive's indictment of, conviction of, or no contest plea to, an act of
theft, fraud or embezzlement; (iv) the commission of a felony; or (v) a material
breach of the terms of an agreement between the Executive and the Company or any
subsidiary or affiliate on the other hand or a material breach of any Company
policy.
 
(d) Good Reason.  "Good Reason" shall mean one or more of the following:  (i)
the material reduction of Executive’s duties and/or responsibilities, which is
not cured within 30 days after the Executive provides written notice to the
Company; provided, however, it shall not be considered Good Reason if, upon or
following a Change in Control, the Executive’s duties and responsibilities
remain the same as those prior to the Change in Control but the Executive’s
title and/or reporting relationship is changed; (ii) the material reduction of
Executive’s base salary (which is not cured within 30 days after the Executive
provides written notice), other than across-the-board decreases in base salary
applicable to all executive officers of the Company; or (iii) the relocation of
the Executive to a business location in excess of fifty (50) miles from the
Company’s headquarters in San Antonio (which is not cured within 30 days after
the Executive provides written notice). To be considered a resignation from
employment on account of Good Reason, the Executive must provide written notice
to the Company (stating that Executive believes one or more of the Good Reason
conditions described above exists) within 30 days of the initial existence of
such condition, and must resign within 30 days of the Company’s failure to cure
such condition.
 
(e) Disability.  For purposes of this Agreement, "Disability" shall mean that
the Executive is unable, with or without reasonable accommodation, to perform
one or more essential functions of his or her position as an employee of the
Company as the result of his or her incapacity due to physical or mental
impairment for more than 90 days (not necessarily consecutive) in any 180-day
period.
 
4. Severance Benefits Upon a Qualifying Termination.
 
(a) Qualifying Termination in Connection with a Change in Control.  If the
Executive experiences a Qualifying Termination upon or within 24 months
following a Change of Control, then the Executive shall be entitled to receive
the following severance benefits, which shall be in addition to any salary
earned and vacation accrued up to and including the date of termination, as
determined by the Company: (i) a severance payment in the amount of two
times  the sum of the Executive's annual base salary plus annual target bonus,
payable as a lump sum payment within five business days of the date the
Executive executes and returns a full waiver and release of all claims in a form
provided by the Company in the form attached hereto; and (ii) if the Executive
timely elects COBRA health insurance continuation coverage, reimbursement of
COBRA premiums for up to 18 months following the date of termination.
 
(b) Qualifying Termination not in Connection with a Change in Control.  If the
Executive experiences a Qualifying Termination that is not in connection with a
Change of Control as described in Section 4(a) herein, then the Executive shall
be entitled to receive the following severance benefits, which shall be in
addition to any salary earned and vacation accrued up to and including the date
of termination, as determined by the Company: (i) a severance payment in the
amount of the Executive's annual base salary plus annual target bonus, payable
as a lump sum payment within five business days of the date the Executive
executes and returns a full waiver and release of all claims in the form
attached hereto; and (ii) if the Executive timely elects COBRA health insurance
continuation coverage, reimbursement of COBRA premiums for up to 12 months
following the date of termination.
 
5. Termination of Executive's Employment Other than a Qualifying Termination
 
(a) Termination on Account of Executive's Disability or Death.  If the Company
terminates the Executive’s employment as a result of the Executive’s Disability
or due to the death of the Executive, then the Executive shall not be entitled
to receive any severance benefits and shall only be entitled to receive any
salary earned and vacation accrued up to and including the date of termination;
provided, however, that this provision shall not have any effect upon any rights
the Executive or his estate may have under the terms of any Company short or
long-term disability policy or life insurance policy.
 
(b) Termination for Cause or Resignation without Good Reason.  If the Executive
is terminated for Cause or resigns from employment without Good Reason, then the
Executive shall not be entitled to receive any severance benefits and shall only
be entitled to receive any salary earned and vacation accrued up to and
including the date of termination
 
6. Conditions to Severance Benefits.
 
(a) No severance benefits shall be made under Sections 4(a) and (b) unless and
until the Executive shall, in consideration of such benefits, execute a full
waiver and release of all claims in the form attached hereto, which shall be
delivered to the Company within 45 days following the Executive’s termination.
 
(b) The Executive acknowledges and agrees that he or she is not entitled to any
severance or change in control benefits provided under the terms of the 1997 KCI
Severance Pay Plan or any similar agreement, plan or arrangement, other than the
Company's stock option plans.
 
(c) All payment of severance benefits under this Agreement shall comply with
section 409A of the Internal Revenue Code.
 
7. Successors.
 
(a) Company’s Successors.  Any successor (or parent thereof) to the Company
(whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) or to all or substantially all of the
Company’s business and/or assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement in
the same manner and to the same extent as the Company would be required to
perform such obligations in the absence of a succession.  For all purposes under
this Agreement, the term "Company" shall include any successor (or parent
thereof) to the Company’s business and/or assets.
 
(b) Executive’s Successors.  All rights of the Executive hereunder shall inure
to the benefit of, and be enforceable by, the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.  Executive shall have no right to assign any of his
obligations or duties under this  Agreement to any other person or entity.
 
8. Notice.
 
(a) General.  Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid.  In the case of the Executive, mailed
notices shall be addressed to him at the home address which he most recently
communicated to the Company in writing.  In the case of the Company, mailed
notices shall be addressed to its corporate headquarters, and all notices shall
be directed to the attention of its General Counsel.
 
(b) Notice of Termination.  Any termination by the Company for Cause or by the
Executive for Good Reason shall be communicated by a written notice of
termination to the other party hereto.  Such notice shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination under the provision so indicated.
 
9. Arbitration.  All disputes relating to or arising out of this Agreement or
otherwise in connection with the Executive's employment with, or termination
from, the Company, shall be settled by binding arbitration in accordance with
the Company's standard arbitration policy and procedures.
 
10. Miscellaneous Provisions.
 
(a) Waiver.  No provision of this Agreement shall be amended, modified, waived
or discharged unless the modification, waiver or discharge is agreed to in
writing and signed by the Executive and by an authorized officer of the Company
(other than the Executive).  No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.
 
(b) Choice of Law.  The validity, interpretation, construction and performance
of this Amended Agreement shall be governed by the laws of the State of Texas.
 
(c) Severability.  The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision hereof, which shall remain in full force and effect.
 
(d) Employment Taxes.  All payments made pursuant to this Agreement will be
subject to withholding of applicable income and employment taxes and other
authorized deductions.
 
(e) No Representations.  Each party acknowledges that it is not relying and has
not relied on any promise, representation or statement made by or on behalf of
the other party that is not set forth in this Amended Agreement.
 
(f) Counterparts.  This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together will constitute one and
the same instrument.
 
(g) Prior Agreements.  Except as specifically set forth in the Non-Disclosure,
Inventions Assignment and Non-Competition Agreement, this Agreement shall
supersede all prior arrangements, whether written or oral, and understandings
regarding the subject matter of this Agreement.

 
[Signatures to Follow on Next Page]

 

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In Witness Whereof, each of the Parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of the day and year first
above written.
 
 
COMPANY
Kinetic Concepts, Inc.
 
By:       /s/ Cathy Burzek
 
Title:  President and Chief Executive Officer
 
EXECUTIVE
/s/ Michael C. Genau
 
Michael C. Genau

 
 

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[FORM OF RELEASE AGREEMENT]
 
 
Date
 
Employee Name & Address
 
RE:           Release Agreement
 
Dear _________:
 
As discussed, this letter confirms that your employment with Kinetic Concepts,
Inc. (“KCI”) and any of its affiliates and subsidiaries (“KCI”) will end on a
date to be mutually agreed, but in no event later than ____________, 20--.  In
connection with the separation, KCI will provide you with the severance benefits
set forth in paragraph 5 below, together with the KCI obligations set forth in
this letter (the “KCI Consideration”).  This letter will confirm our compromise
and settlement of all the matters we discussed, as set forth herein.
 
1.  Release.  You agree that in exchange for the KCI Consideration you will
release any and all claims you may have against Kinetic Concepts, Inc., its
affiliates, subsidiaries, directors, officers, employees, trustees, agents,
stockholders, representatives and/or attorneys (“KCI” or the “Releasees”).  With
full understanding of the contents and legal effects of this agreement, you
individually and on behalf of your spouse, heirs, executors, dependents and
successors, and each of them (“Releasors”), hereby knowingly and voluntarily
waive and release any claim against the Releasees relating to salary,
commissions, wages, benefits, stock, stock options, severance pay, bonuses, sick
leave, workers’ compensation benefits, holiday pay, vacation pay, agreements,
and any other claims or causes of action, attorneys’ fees, damages or any other
alleged liability arising out of or in any way connected this agreement, your
employment relationship with KCI, your separation from employment, and any other
transaction, occurrence, act or omission prior to the date of this agreement
between you and the Releasees.
 
This release also includes any cause of action you may have based upon public
policy, claims involving discrimination or harassment of any form (including,
without limitation, sex, race, national origin, age, religion or disability), or
retaliation.  This release further covers any claim you may have under the Equal
Pay Act, the Fair Labor Standards Act, the Family and Medical Leave Act, Title
VII of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991,
the Texas Commission on Human Rights Act, the Americans with Disabilities Act,
Texas Workers’ Compensation Act or any other similar federal, state or local law
or regulation and any claim for salary, wages, commissions severance pay, bonus,
sick leave, holiday pay, vacation pay, life insurance, health or medical
insurance or any other fringe benefits.
 
You knowingly and voluntarily waive any possible rights or claims you may have
against KCI under the Age Discrimination in Employment Act and similar state or
local statute, and you understand and agree that:

A.  
this waiver is written in a manner that you understand;
 

B.  
you are not waiving any claims against KCI that may arise after this agreement
is executed;
 

C.  
the KCI Consideration is in addition to any other consideration or benefits owed
to you by KCI;
 

D.  
you have the right and have had the opportunity to consult with an attorney of
your choice regarding the terms of this agreement;
 

E.  
you have twenty-one (21) days to consider the terms of this agreement and
whether you will execute it; and
 

F.  
this agreement will only become effective or enforceable if you execute it
timely and do not revoke it during the seven (7) day revocation period.
 

2.  Non-compete. In exchange for the KCI Consideration provided pursuant to this
agreement, and because of your position as an executive with the company and
your close contact with many confidential affairs of KCI, you agree that for
period of two (2) years from your termination date (a) you will not, alone or as
an officer, director, stockholder (except for investments in securities of
publicly traded companies that are not in excess of one percent (1%) of such
entity's securities), be a partner, associate, employee, agent, principal, or in
any other capacity, participate with or become associated with any person, firm,
partnership, corporation or other entity that is engaged in a business that
competes directly with the Company (including, without limitation, the negative
pressure therapy, therapeutic surfaces, or tissue regeneration businesses of the
Company).  This Non-Competition provision shall be limited to the specific areas
of responsibility and geographic areas served by you during your employment with
the Company.
 
3.  Non-solicitation.  You agree that for a period of two (2) years from your
separation of employment with the Company, you will not directly or indirectly:
(i) influence or attempt to influence customers or suppliers of the Company or
any of its present or future subsidiaries or affiliates of the Company, either
directly or indirectly, to divert their business to any other entity then in
competition with the business of the Company or any subsidiary or affiliate of
the Company, or (ii) solicit or attempt to solicit any of the employees, agents,
or consultants of the Company out of their employment, contractual, or other
relationship with the Company to work for any business, individual, partnership,
firm, or corporation.
 
4.  Confidentiality.  In exchange for the KCI Consideration provided pursuant to
this agreement, and because of your position as an executive in the company and
your close contact with many confidential affairs of KCI, including all matters
related to KCI’s business, such as information concerning customers, business
plans, costs, profits, markets, operations, sales, trade secrets, and plans for
future developments and any other proprietary information which is not publicly
available, which information was imparted to you because of and during your
employment by KCI (hereinafter collectively referred to as “Confidential
Matters”), you agree at all times to protect from damage or destruction and to
keep secret and confidential all Confidential Matters of KCI.  Additionally, you
agree not to disclose any Confidential Matters to anyone outside of KCI or
otherwise use those Confidential Matters or your knowledge of the Confidential
Matters for your own benefit or for the benefit of any other person other than
KCI.
 
5.  Separation Payment.  In exchange for your promises contained herein, KCI
agrees to make a separation payment to you, in an amount equal to
$--------------, provided that you do not revoke this agreement within the seven
(7) day period referenced in paragraph 1(F) above.  If you timely elect COBRA
health insurance continuation coverage, you will be reimbursed for COBRA
premiums for up to 12  months or 18 months (as set forth in your Executive
Retention Agreement)  following the date of termination. You agree that as of
the execution of this agreement, KCI has no outstanding obligations to you,
other than the consideration set forth herein.
 
6.  Equity Awards.  You understand and acknowledge that your outstanding equity
awards (non-qualified stock options and restricted stock awards) will be
governed by the terms of the award agreements respecting such awards, and that
this letter does not alter or amend the terms thereof.  Upon the termination of
your employment, KCI’s equity administration department will provide you with a
detail of vested equity awards that may be exercised by you during the time
periods prescribed under the equity award agreements.  All unvested equity
awards will be forfeited according to the terms of the equity award agreements
and the KCI equity plans governing such awards.
 
7.  Miscellaneous.  On or before the date you execute this agreement, you will
return all property in your possession, custody or control which belongs to KCI,
including without limitation, keys, credit cards, computers, phone cards and any
of KCI’s documents, whether kept in paper or electronic format.  Neither you nor
anyone acting on your behalf has maintained copies of any of these documents.
 
Except as required by applicable law, the terms and conditions of this agreement
shall remain confidential and you shall not respond to or participate in any
public discussion or other publicity concerning or relating to your employment
with or separation from KCI.  Both parties agree and covenant not to make any
derogatory or negative comments about either party or the management, operations
or financial condition of KCI and agree to cooperate with KCI to the extent
reasonably necessary regarding the transition of matters worked on by you during
your employment with KCI.  You agree to be available by phone for consulting as
needed on a reasonable basis by the Company for up to 60 days following your
termination.
 
You agree to indemnify KCI and agree to hold it harmless for any claims brought
by any taxing authority against any of the Releasees seeking payment of taxes,
penalties and/or interest related to the assessment, determination and/or
reporting of taxes under federal, state and/or local law, including, without
limitation, payment of attorneys’ fees for counsel selected by KCI for its
defense of such matters and costs.
 
This agreement is being executed voluntarily and without duress or
coercion.  Any claim or controversy arising out of or relating to this
agreement, your employment with or separation from KCI, or arising out of any
other transaction or occurrence with the Releasees, shall be submitted to final
and binding arbitration in Bexar County Texas according to the procedures set
out in KCI's Arbitration Policy.  With an adequate opportunity to consult with
legal counsel, you have knowingly and voluntarily waived any right to trial by
jury of any dispute with any of the Releasees, notwithstanding contrary
provisions of any federal, state or local law, regulation or
ordinance.  Notwithstanding the foregoing provisions, if you breach any of the
non-disclosure provisions of this agreement, KCI shall have the right to seek
immediate injunctive relief in the form of a temporary restraining order or
preliminary injunction, enjoining you from such further breach of those
provisions of this agreement, pending a final ruling by the arbitrator.  This
agreement is governed by the laws of the state of Texas, without regard to
conflict of laws rules.
 
Please indicate your agreement to the foregoing terms by signing and dating the
agreement in the space provided below.  If you decide to revoke the agreement,
it must be in writing and be received by me at the above address before the
close of business on the seventh day after execution of this agreement.
 
 
Kinetic Concepts, Inc.

By:                                                                 
Name:                                                            
Title:                                                                                                                     

 
AGREED AND ACCEPTED:

                                                                      
Name
 
 
                                                                    

Date:                                                      
 
 

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WAIVER

I, ____________, understand that I may take up to twenty-one (21) days from
receipt of the ___________, 20-- Letter Agreement to which this is attached, to
review the document and determine whether to accept it.  I hereby knowingly and
voluntarily waive the 21-day review provision of the Letter Agreement.  I
acknowledge and understand that this Waiver is part of the Letter Agreement
between myself and Kinetic Concepts, Inc., and as such includes all rights and
claims arising prior to or on the effective date of the Letter Agreement,
including, but not limited to, the Age Discrimination in Employment Act of 1967,
Title VII of the Civil Rights Act of 1964, the Texas Commission on Human Rights
Act and the Older Workers' Benefits Protection Act.

I have been advised by Kinetic Concepts, Inc. to consult with my attorney prior
to executing the Letter Agreement, and I acknowledge that I fully understand the
terms of the Letter Agreement.  I have not been compelled into signing it by
anyone associated with Kinetic Concepts, Inc. and have entered into the Letter
Agreement and this Waiver voluntarily and of my own free will.

     
Date
 
Name