AMENDMENT
LETTER

		
	To:     	Allied Healthcare
Holdings Limited
Allied Healthcare Group Holdings Limited (formerly
Allied Healthcare Group Limited)
Stone Business Park
Brooms
Road
Stone
Staffordshire ST15 0TL


		
	 	Fax No:
01785 819031


Attention: Paul Weston

28
July  2006

Dear Sirs

Project Air: Amendment
Letter

We refer to the £50,000,000 facility
agreement dated 19 July  2004 between Allied Healthcare Group
Limited (the ‘‘Company’’),
Allied Healthcare Holdings Limited (the
‘‘Borrower’’), Allied
Healthcare International Inc, the Guarantors listed therein, Barclays
Capital and Lloyds TSB Bank PLC as Arrangers and Ancillary Lenders, the
Original Lenders listed therein and Barclays Bank PLC as Agent and
Security Agent (the ‘‘Original
FacilityAgreement’’).

		
	1 	DEFINITIONS


Terms
defined in the Original Facility Agreement have the same meaning in
this Letter and:

‘‘Amended
Agreement’’ means the Original Facility
Agreement, as amended by this
Letter.

‘‘Bank’’
means Barclays Bank
PLC.

‘‘Effective
Date’’ means the date on which the Agent notifies
the Company that it has
received:

			
		(i) 	for the Parent and
each of the Obligors, either a copy of their respective constitutional
documents or a certificate of an authorised signatory of each of them
certifying that the constitutional documents previously delivered to
the Agent on or before 19 July  2004 for the purposes of the
Original Facility Agreement have not been amended and remain in full
force and effect;


			
		(ii) 	a copy of a
resolution of the board of directors of the Parent and each
Obligor:


			
		(a) 	approving the terms of,
and the transactions contemplated by, this Letter and resolving that it
execute this Letter;
and


			
		(b) 	authorising a specified
person or persons to execute this Letter on its
behalf.


			
		(iii) 	a specimen of the
signature of each person authorised by the resolution referred to in
paragraph (ii) above.


			
		(iv) 	a
certificate of the Company (signed by a director) confirming that
borrowing or guaranteeing, as appropriate, the Facility A Commitment
and the Facility B Commitment under the Amended Agreement would not
cause any borrowing, guaranteeing or similar limit binding on the
Parent or any Obligor to be exceeded;


			
		(v) 	a certificate of an authorised
signatory of the Parent and the relevant Obligor certifying that each
copy document listed at (i) to (iv) above is correct, complete and in
full force and effect as at a date no earlier than the date of this
Letter; and


			
		(vi) 	a copy of an
engagement letter, duly executed by all parties thereto and in form and
substance satisfactory to the Agent, between the Reporting Accountants
and the Company, pursuant to which the Reporting Accountants are
appointed to conduct an independent business review of the Group (at
the cost and expense of the Company).


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‘‘Overdraft
Facility’’ means the uncommitted overdraft
facility in a maximum amount of £3,000,000 made available by the
Bank to the Borrower pursuant to the terms of this
Letter.

‘‘Reporting
Accountants’’ means Grant Thornton LLP, or such
firm of accountants as the Agent may nominate.

		
	2 	OVERDRAFT


			
		2.1 	The
Bank agrees, subject to the terms and conditions of this Letter, to
make the Overdraft Facility available to the Borrower from the
Effective Date. The Overdraft Facility is made available on an
uncommitted basis and may be cancelled by the Bank at any time by
notice to the Borrower.


			
		2.2 	The Overdraft Facility will
be available for utilisation by way of overdraft on the current account
of the Borrower held with the
Bank.


			
		2.3 	The total
utilisations in respect of the Overdraft Facility at any time shall not
exceed £3,000,000. The Bank may refuse any utilisation request
that would result in this limit being
exceeded.


			
		2.4 	The Overdraft
Facility shall be repayable by the Borrower on an ‘‘on
demand basis’’, that is to say that the Bank may at any
time and without giving any reason therefore demand immediate repayment
of all or any part the Overdraft Facility or may by notice immediately
cancel any part of the Overdraft Facility, whereupon it shall be
immediately due and payable to the
Bank.


			
		2.5 	The Borrower shall
apply all amounts borrowed under the Overdraft Facility for its general
corporate purposes.


			
		2.6 	To the
extent that no demand is made in respect of the Overdraft Facility on
or prior to 15 September  2006, the Borrower shall ensure that
all amounts outstanding in respect of the Overdraft Facility are
reduced to zero, and the Overdraft Facility shall be automatically
cancelled, on 15 September
2006.


			
		2.7 	Interest on the
Overdraft Facility shall be charged at the same rate as is applicable
to Facility B under the Amended Agreement and shall be computed on a
365 day basis and shall be payable on demand, or if no such demand is
made, on or prior to 15 September  2006, on 15 September
2006.


			
		2.8 	The provisions of
Clause 13 of the Amended Agreement shall be incorporated into this
Letter as if set out in full and shall apply in respect of the
Overdraft Facility.


			
		2.9 	If the
Bank does allow any utilisation resulting in the facility limit being
exceeded in respect of the Overdraft Facility, it will not mean that
such limit has changed or that the Bank will agree to any other
utilisation which would have the effect of exceeding the limit and the
right of the Bank to charge an unauthorised excess margin and / or
unauthorised excess fee pursuant to Clause 2.10 below does not
constitute an agreement by the Bank to permit borrowings in excess of
any limit applicable to the Overdraft
Facility.


			
		2.10 	To the extent
that any time the aggregate total utilisations under the Overdraft
Facility exceed £3,000,000 without the prior written consent of
the Bank (each such instance an
‘‘Excess’’), the Bank shall
be entitled to charge the Borrower:


			
		2.10.1 	a fee in the amount of
£10,000 for each instance of such an Excess arising; and


			
		2.10.2 	interest on the entire
amount outstanding under the Overdraft Facility at the time of Excess
calculated at a rate of 15% per annum above the Bank’s
base rate from time to time, such default rate of interest to remain
applicable until any relevant Excess has been repaid and the total
utilisation under the Overdraft Facility have been reduced to below
£3,000,000. Any interest payable pursuant to this Clause 2.10.2
shall be computed on a 365 day basis and shall be payable on demand, or
if no such demand is made, on or prior to 15 September  2006, on
15 September 2006.


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		2.11 	The
Obligors hereby confirm that the Security granted in favour of the
Security Agent pursuant to the Security Documents is granted as
continuing security for present and future moneys, debts and
liabilities due, owing or incurred by the Borrower under or in
connection with any Finance Document, including by virtue of the
designation of this Letter as a Finance Document, any present and
moneys, debts and liabilities due, owing or incurred by the Borrower
under or in connection with the Overdraft
Facility.


		
	3 	COVENANTS


			
		3.1 	Waiver
of Clause 21.1(c) of the Original Facility Agreement


The
parties to this letter hereby temporarily waive, subject to the terms
of this Letter, the obligation of the Company, pursuant to Clause
2.1(c) of the Original Facility Agreement, to ensure that the ratio of
EBIT to Interest Expense for the period of 12 months ending on 30
June  2006 (being the last day of the Company’s Accounting
Quarter) will not be less than 4.0 to
1.0.

			
		3.2 	Duration of
Waiver


The temporary waiver set out in Clause 2.1 above
of this Letter will have effect from the Effective Time and will cease
to have effect on the earliest to occur
of:

			
		3.2.1 	5.30pm on 15
August  2007;


			
		3.2.2 	occurrence of an Event of
Default under the Amended
Agreement


			
		3.2.3 	any Obligor
failing to comply with any terms of this Letter


			
		3.3 	Resetting of EBIT to
Interest Expense Covenant


The Lenders and the Company
hereby undertake to use all reasonable endeavours to agree, on or prior
to 15 September  2006, a revised Clause 21.1(c) of the Amended
Facility Agreement, such revised Clause 21.1(c) to be in form and
substance satisfactory to the
Lenders.

			
		3.4 	Acquisition
Covenant


Notwithstanding the provisions of Clause 22.11
of the Original Facility Agreement, the Parent and each Obligor
undertakes that it will not (and the Company undertakes that it will
ensure that no other member of the Group will), on or prior to 15
September
2006:

			
		3.4.1 	invest in or
acquire any share in, or any security issued by, any person, or any
interest therein or in the capital of any person, or make any capital
contribution to any person (or agree to do any of the foregoing);
or


			
		3.4.2 	invest in or acquire
any business or going concern, or the whole or substantially the whole
of the assets or business of any person, or any assets that constitute
a division or operating unit of the business of any person (or agree to
do any of the foregoing);
or


			
		3.4.3 	enter into any joint
venture agreement with any person;
or


			
		3.4.4 	acquire or agree to
acquire any other assets other than in the ordinary course of
trading,


without the prior written consent of the
Lenders.

3









		
	4 	AMENDMENTS


			
		4.1 	Amendment to the Original
Facility Agreement


The parties to the Letter agree
that, with effect from the Effective Date, the Original Facility
Agreement shall be amend as
follows:

			
		(a) 	the following
definitions shall be added to Clause
1.1:


‘‘Amendment
Letter’’ means the amendment letter dated 28
July  2006 between the parties to this Agreement, pursuant to
which the Overdraft Facility was made available to the
Borrower.

‘‘Amendment Letter
Effective Date’’ has the meaning given to the
term Effective Date in the Amendment
Letter.

‘‘Overdraft
Facility’’ means the overdraft facility in a
maximum amount of £3,000,000 made available by Barclays Bank PLC
to the Borrower pursuant to the terms of the Amendment
Letter.

‘‘Required
Form’’ means, in relation to any document, as
agreed in respect of both form and substance by the
Agent;

‘‘Reporting
Accountants’’ means Grant Thornton LLP or such
firm of accountants as the Agent may nominate;’’;

			
		(b) 	Sub-clause 21.1 (c) shall be
deleted and replaced as follows:


‘‘(c) the
ratio of EBIT to Interest Expense for the Relevant Period ending
on:

			
		(ii) 	30 September  2006
will not be less than 2.5:1;


			
		(iii) 	31 December  2006 will not
be less than 2.4:1;


			
		(iv) 	31
March  2007 will not be less than 2.75:1;


			
		(v) 	30 June  2007 will not be
less than 3.4:1; and


			
		(v) 	any date
other than those listed at (i) to (v) above will not be less than
4:1.’’


			
		(c) 	a new
Clause 20.7 shall be added as
follows:


‘‘20.7 Reporting
Accountants


The Agent may, at any time prior to the
date falling 12 months after the Amendment Letter Effective Date,
appoint the Reporting Accountants to conduct an independent business
review of the Group or to monitor the financial and operational
performance of the Obligors on an ongoing basis. The Obligors hereby
undertake to co-operate in such a review and agree that such review
shall be at the cost and expense of the
Company.’’;

			
		(d) 	A new
Clause 20.8 shall be added as
follows:


‘‘20.8 Cashflow
Forecasts


The Company shall supply to the Agent (in
sufficient quantities for all the Lenders, if the Agent so requests),
on a monthly basis until 15 September  2006, a rolling 13 week
cashflow forecast for the Group (for each 13 week period commencing on
the Monday of each week on and from the Amendment Letter Effective
Date). The first such cashflow forecast shall be provided on the first
Monday following the Amendment Letter Effective Date and subsequent
cashflow forecasts shall be provided on each day on which monthly
management accounts are provided to the Lender pursuant to the terms of
Clause 20.9 below (however no such cashflow forecast is required to be
provided on the date on which monthly management accounts are delivered
in respect of June 2006);’’

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		(e) 	a new
Clause 20.9 shall be added as
follows:


‘‘20.9 Monthly
Reporting


The Company shall supply to the Agent (in
sufficient quantities for all the Lenders, if the Agent so requests),
on a monthly basis until 15 September  2006, as soon as the same
are available (and in any event within 30 days of the end of each
month), its monthly management accounts (with accompanying management
commentary) for the Group in the Required Form. The first such monthly
management accounts shall be delivered on or prior to 30 July
2006 in respect of the month of June
2006’’.

			
		4.2 	Continuing
obligations


The provisions of the Original Facility
Agreement and the other Finance Documents shall, save as amended by
this Letter, continue in full force and effect. Where there is any
inconsistency between the terms of this Letter and the Amended
Agreement, the terms of this Letter will
apply.

		
	5 	Financial Projections


The
Company shall, on or prior to 14 August  2006, provide to the
Agent (in sufficient quantities for all the Lenders, if the Agent so
requests), a re-forecast budget for the period from the Effective Date
to 20 September  2008 (the
‘‘Re-forecast’’), such
Re-forecast to in form and substance satisfactory to the Agent. Such
Re-forecast shall include, but not be limited
to:

			
		(i) 	a projected cash flow
statement and profit and loss account of the Group;


			
		(ii) 	a projected balance sheet of the
Group;


			
		(iii) 	capital expenditure,
investments, acquisitions and disposals projected to be made by the
Group;


			
		(iv) 	projected levels of the
financial ratios required to be met by the Company pursuant to Clause
21.1 of the Amended Agreement; and


			
		(v) 	a management commentary on the
proposed activities of the Group, the principal assumptions underlying
the projections in the Re-forecast and any material variations from the
last budget provided to the Agent pursuant to Clause 20.1(e) of the
Amended Agreement.


		
	6 	FEES


On the
Effective Date, the Borrower shall pay to the Agent (for the account of
each Lender) a fee in the Base Currency in the amount of
£102,500.

		
	7 	COSTS AND
EXPENSES


			
		7.1 	Transaction
costs


The Company shall within three Business Days
of demand reimburse the Agent for the amount of all costs and expenses
(including legal fees) reasonably incurred by the Agent in connection
with the negotiation, preparation, printing and execution of this
Letter and any other documents referred to in this
Letter.

			
		7.2 	Ongoing incidental
costs


Without prejudice to the generic costs and
expenses provisions in Clause 17 of the Original Facility Agreement and
elsewhere in the Finance Documents the Company shall, for the period
from the Effective Date to 15 September 2006,    within seven
Business Days of demand reimburse the Secured Party for the amount of
all travel costs and incidental expenses reasonably incurred by that
Secured Party at any time after the Effective Date in connection with
any meetings required with the Company or other Group members to


5










discuss the protection or preservation of
rights under this Letter and any other document referred to in this
Letter and in connection with the consideration and or discussion of
the independent business review with the Company and/or other Group
members and/or with the Reporting
Accountants.

			
		7.3 	Payment of Fees,
Costs and Expenses


The Company hereby irrevocably
authorises the Lender to cause the Company to satisfy any payment
obligations arising pursuant to Clause 6 above and this Clause 7 by
debiting any bank account of the Company held with the
Lender.

		
	8 	LOSS
SHARE


			
		8.1 	In consideration
of the Bank providing the Overdraft Facility, each of the Lenders
agrees that, to the extent that the Bank does not recover within 30
days of making demand all amounts owing to it in connection with the
Overdraft Facility, they shall pay to the Bank within 5 Business Days
of demand, the proportion of such shortfall as is equal to each
Lenders’ percentage participation in the Total Facility
Commitments (any such payment a ‘‘Loss Share
Payment’’).


			
		8.2 	For
the avoidance of doubt, no Lender shall be required to make any Loss
Share Payment(s) pursuant to Clause 8.1 above in an aggregate amount in
excess of £1,500,000.


			
		8.3 	To the extent that any Loss
Share Payment is made pursuant to Clause 8.1 above, such Lender shall
be subrogated to the extent possible to that part of the Bank’s
claim under the Overdraft Facility against the Borrower which
corresponds to the relevant Loss Share Payment. However, for the
avoidance of doubt, no such Lender shall receive any payment from or
exercise any rights against the Borrower as a result of such
subrogation until after the Bank has received the relevant Loss Share
Payment from it.


		
	9 	AMENDMENT AND
RESTATEMENT


The Lenders hereby confirm that it is their
current intention to enter into negotiations with the Company with a
view to agreeing, on terms acceptable to all parties, an amendment and
restatement to the Amended Facility Agreement on or prior to 15
September  2006. For the avoidance of doubt, this Clause 9 does
not constitute a legally binding commitment to enter into any such
amendment and restatement
agreement.

		
	10 	MISCELLANEOUS


			
		10.1 	Guarantors


Each
of the Guarantors and the Parent agree to each of the provisions of
this Letter, including without limitation, the provision of the
Overdraft Facility and the amendments to the Original Facility
Agreement contemplated by this Letter and each agrees that (i) nothing
in this Letter effects its obligations as a Guarantor or in the case of
the Parent as the Parent and (ii) its obligations as a Guarantor or in
the case of the Parent as the Parent, extend to the Overdraft
Facility.

			
		10.2 	Reservation of
Rights


This Letter is provided by the Finance
Parties strictly on the basis that the Finance Parties reserve all
rights and remedies of the Agent, the Security Agent and the Finance
Parties under the Original Facility Agreement and the Amended
Agreement. Other than as set out in this Letter, nothing in this Letter
or done pursuant to this Letter, will constitute an amendment to or is
intended to operate as a release or waiver of any breach or potential
breach of, or any obligations under any Finance Document.

			
		10.3 	Third Party
Rights


A person who is not a party to this Letter
has no right under the Contracts (Rights of Third Parties) Act 1999 to
enforce any of the provisions of this Letter.

6









			
		10.4 	Counterparts


This
Letter may be signed in a number of counterparts, and this has the same
effect as if the signatures on the counterparts were on a single copy
of this Letter.

			
		10.5 	Joint and
Several Obligations


The obligations of the Finance
Parties under this Letter are several. The obligations of the Obligors
under this Letter are joint and
several.

			
		10.6 	Finance
Documents


In accordance with the Amended Agreement,
each of the Company and the Agent designate this Letter as a Finance
Document.

		
	11 	GOVERNING LAW


This Letter
will be governed and construed in accordance with English
law.

7









We hereby agree to the terms of this
Letter:

The Original Lenders

Barclays Bank
PLC

By:    /s/ Alan Douglas

Lloyds TSB
Bank plc

By:    /s/ Rebecca Killeen

Ancillary
Lenders

Barclays Bank PLC

By:    /s/
Alan Douglas

Lloyds TSB Bank
plc

By:    /s/ Rebecca Killeen

The
Bank

Barclays Bank PLC

By:    /s/ Alan
Douglas

The Agent

Barclays Bank
PLC

By:    /s/ Shahid Kazi

The Security
Agent

Barclays Bank PLC

By:    /s/
Shahid Kazi

8









Agreed and Accepted by: The
Company

Allied Healthcare Group Holdings Limited
(formerly Allied Healthcare Group Limited)

By:    /s/
Timothy Aitken

The Parent

Allied Healthcare
International, Inc.

By:    /s/ Timothy
Aitken

The Original Borrower

Allied
Healthcare Holdings Limited

By:    /s/ Timothy
Aitken

The Original Guarantors

Allied
Healthcare Group Holdings Limited (formerly Allied Healthcare Group
Limited)

By:    /s/ Timothy Aitken

Allied
Healthcare Holdings Limited

By:    /s/ Timothy
Aitken

Allied Healthcare Group Limited (formerly Allied
Healthcare (UK) Limited)

By:    /s/ Paul
Weston

Allied Respiratory Limited (formerly Allied Oxycare
Limited)

By:    /s/ Paul Weston

Balfor
Medical Limited

By:    /s/ Paul
Weston

Crystalglen Limited

By:    /s/
Paul Weston

Medigas Limited

By:    /s/
Paul Weston

Nightingale Nursing Bureau
Limited

By:    /s/ Paul Weston

Omnicare
Limited

By:    /s/ Paul Weston

Allied
Staffing Professionals Limited (formerly Staffing Enterprise
Limited)

By:    /s/ Paul
Weston

9