10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013

Commission file number 001-09913

CENTAUR GUERNSEY L.P. INC.

(Exact name of registrant as specified in its charter)

Guernsey	98-1022387
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
12930 West Interstate 10 San Antonio, Texas	78249
(Address of principal executive offices)	(Zip Code)

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

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 whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).                                          Yes   X        No   

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer			Accelerated filer
Non-accelerated filer	X	(Do not check if a smaller reporting company)	Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  

    Yes   ____         No      X   

As of November 13, 2013, there were 341,410,891.610 Class A-1 and 728,041.800 Class A-2 partnership units outstanding, all of which were held by affiliates.   

TABLE OF CONTENTS

CENTAUR GUERNSEY L.P. INC.

			Page No.
PART I.	FINANCIAL INFORMATION		4
	Item 1.	Financial Statements	4
		Condensed Consolidated Balance Sheets	4
		Condensed Consolidated Statements of Operations	5
		Condensed Consolidated Statements of Comprehensive Loss	6
		Condensed Consolidated Statements of Cash Flows	7
		Notes to Condensed Consolidated Financial Statements	8
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	31
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	40
	Item 4.	Controls and Procedures	40
PART II.	OTHER INFORMATION		41
	Item 1.	Legal Proceedings	41
	Item 1A.	Risk Factors	41
	Item 6.	Exhibits	42
	SIGNATURES		43

2

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, “forward-looking statements.” The forward-looking statements are based on our current expectations and projections about future events. Discussions containing forward-looking statements may be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Risk Factors,” and elsewhere in this report. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “predicts,” “projects,” “potential,” “continue,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” or the negative of those terms and other variations of them or by comparable terminology.

These forward-looking statements are only predictions, not historical facts, and involve certain risks and uncertainties, as well as assumptions. Actual results, levels of activity, performance, achievements and events could differ materially from those stated, anticipated or implied by such forward-looking statements. The factors that could contribute to such differences include those discussed under the caption “Risk Factors.” You should consider each of the risk factors and uncertainties under the caption “Risk Factors” in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, and in our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2013 and June 30, 2013, among other things, in evaluating our prospects and future financial performance. The occurrence of the events described in the risk factors could harm our business, results of operations and financial condition. These forward-looking statements are made as of the date of this report. Except as required under federal securities laws and the rules and regulations of the Securities and Exchange Commission, we do not have any intention to update any forward-looking statements to reflect events or circumstances arising after the date of this report, whether as a result of new information, future events or otherwise.

TRADEMARKS, SERVICE MARKS AND COPYRIGHTS

3M™ Tegaderm™ is a licensed trademark of 3M Company; GRAFTJACKET® is a licensed trademark of Wright Medical Technology Inc; Novadaq® and SPY® are licensed trademarks of Novadaq Technologies, Inc. Unless otherwise indicated, all other trademarks appearing in this report are proprietary to KCI Licensing, Inc., LifeCell Corporation, or Systagenix Wound Management (US), Inc., their affiliates and/or licensors. The absence of a trademark or service mark or logo from this report does not constitute a waiver of trademark or other intellectual property rights of KCI Licensing, Inc., LifeCell Corporation, or Systagenix Wound Management (US), Inc., their affiliates and/or licensors.

DEFINED TERMS

The following terms are used in this Quarterly Report on Form 10-Q unless otherwise noted or indicated by the context.

• the terms the “Company,” “we,” “our,” and “us” refer to Centaur Guernsey L.P. Inc. (“Centaur”) and its consolidated subsidiaries.

• the term “Merger” refers to the transaction completed on November 4, 2011, pursuant to which Kinetic Concepts, Inc. (“KCI”) was merged with Chiron Merger Sub, Inc., a subsidiary of Centaur.

3

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CENTAUR GUERNSEY L.P. INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(in thousands)

	September 30, 2013			December 31, 2012
	(unaudited)
Assets:
Current assets:
Cash and cash equivalents	$	362,919		$	383,150
Accounts receivable, net	368,900			355,718
Inventories, net	149,986			139,850
Prepaid expenses and other	59,499			39,511
Total current assets	941,304			918,229
Net property, plant and equipment	312,555			388,482
Debt issuance costs, net	101,766			96,476
Deferred income taxes	21,866			20,003
Goodwill	3,207,575			3,479,775
Identifiable intangible assets, net	2,343,525			2,666,201
Other non-current assets	4,054			5,598
	$	6,932,645		$	7,574,764
Liabilities and Equity:
Current liabilities:
Accounts payable	$	44,527		$	40,970
Accrued expenses and other	351,903			284,163
Current installments of long-term debt	24,101			23,383
Deferred income taxes	4,610			57,528
Total current liabilities	425,141			406,044
Long-term debt, net of current installments and discount	4,517,139			4,554,112
Non-current tax liabilities	46,461			44,465
Deferred income taxes	960,219			1,069,480
Other non-current liabilities	38,897			43,267
Total liabilities	5,987,857			6,117,368
Equity:
General partner’s capital	—			—
Limited partners’ capital	952,314			1,457,913
Accumulated other comprehensive loss, net	(7,526		)	(517		)
Total equity	944,788			1,457,396
	$	6,932,645		$	7,574,764

See accompanying notes to condensed consolidated financial statements.

4

CENTAUR GUERNSEY L.P. INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(in thousands)

(unaudited)

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Revenue:
Rental	$	191,041		$	207,156		$	569,449		$	622,350
Sales	249,520			228,717			719,675			684,171
Total revenue	440,561			435,873			1,289,124			1,306,521
Rental expenses	85,746			100,810			273,479			348,387
Cost of sales	66,151			58,613			181,707			190,454
Gross profit	288,664			276,450			833,938			767,680
Selling, general and administrative expenses	152,053			142,778			518,478			445,781
Research and development expenses	17,961			17,376			56,140			53,686
Acquired intangible asset amortization	45,116			49,733			139,123			172,260
Impairment of goodwill and intangible assets	443,400			—			443,400			—
Operating earnings (loss)	(369,866		)	66,563			(323,203		)	95,953
Interest income and other	217			174			1,279			630
Interest expense	(101,398		)	(117,920		)	(315,144		)	(353,107		)
Loss on extinguishment of debt	(200		)	—			(2,364		)	—
Foreign currency gain (loss)	(8,738		)	(5,258		)	(11,935		)	428
Derivative instruments gain (loss)	(6,840		)	(8,579		)	3,200			(28,473		)
Loss from continuing operations before income tax benefit	(486,825		)	(65,020		)	(648,167		)	(284,569		)
Income tax benefit	(88,519		)	(27,176		)	(144,543		)	(107,125		)
Loss from continuing operations	(398,306		)	(37,844		)	(503,624		)	(177,444		)
Gain (loss) from discontinued operations, net of tax	(255		)	2,032			(2,299		)	(3,680		)
Net loss	$	(398,561	)	$	(35,812	)	$	(505,923	)	$	(181,124	)

See accompanying notes to condensed consolidated financial statements.

5

CENTAUR GUERNSEY L.P. INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Loss

(in thousands)

(unaudited)

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Net loss	$	(398,561	)	$	(35,812	)	$	(505,923	)	$	(181,124	)
Unrealized investment gain, net of tax expense of $338 and $1,413 in 2013	541			—			2,257			—
Foreign currency translation adjustment, net of tax benefit (expense) of $(300) and $259 in 2013 and $(164) and $(438) in 2012	(5,131		)	1,597			(9,266		)	(1,587		)
Total comprehensive loss	$	(403,151	)	$	(34,215	)	$	(512,932	)	$	(182,711	)

See accompanying notes to condensed consolidated financial statements.

6

CENTAUR GUERNSEY L.P. INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited)
	Nine months ended September 30,
	2013			2012
Cash flows from operating activities:
Net loss	$	(505,923	)	$	(181,124	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of debt issuance costs and discount	26,356			24,417
Depreciation and other amortization	252,026			346,895
Loss on disposition of assets	3,189			—
Amortization of fair value step-up in inventory	—			25,021
Fixed asset and inventory impairment	30,259			22,116
Impairment of goodwill and intangible assets	443,400			—
Write-off of other intangible assets	16,885			—
Provision for bad debt	5,051			7,019
Loss on extinguishment of debt	2,164			—
Equity-based compensation expense	2,046			1,186
Deferred income tax benefit	(165,456		)	(132,639		)
Unrealized loss (gain) on derivative instruments	(5,729		)	27,770
Unrealized loss (gain) on revaluation of cross currency debt	8,174			(2,685		)
Change in assets and liabilities:
Decrease (increase) in accounts receivable, net	(23,046		)	10,675
Increase in inventories, net	(10,498		)	(7,270		)
Decrease (increase) in prepaid expenses and other	(17,137		)	3,281
Increase (decrease) in accounts payable	3,273			(9,445		)
Increase in accrued expenses and other	68,440			48,359
Increase in tax liabilities, net	2,021			2,299
Net cash provided by operating activities	135,495			185,875
Cash flows from investing activities:
Additions to property, plant and equipment	(59,868		)	(72,044		)
Increase (decrease) in inventory to be converted into equipment for short-term rental	(8,881		)	861
Dispositions of property, plant and equipment	1,052			1,673
Increase in identifiable intangible assets and other non-current assets	(4,273		)	(5,380		)
Net cash used by investing activities	(71,970		)	(74,890		)
Cash flows from financing activities:
Capital contributions from limited partners	—			239
Distribution to limited partners	(1,572		)	(1,970		)
Repayments of long-term debt and capital lease obligations	(60,429		)	(17,483		)
Payment of debt issuance costs	(21,604		)	(578		)
Net cash used by financing activities	(83,605		)	(19,792		)
Effect of exchange rate changes on cash and cash equivalents	(151		)	308
Net increase (decrease) in cash and cash equivalents	(20,231		)	91,501
Cash and cash equivalents, beginning of period	383,150			215,426
Cash and cash equivalents, end of period	$	362,919		$	306,927

See accompanying notes to condensed consolidated financial statements

7

Notes to Condensed Consolidated Financial Statements

NOTE 1.Summary of Significant Accounting Policies

(a)Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP” or “the Codification”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information necessary for a fair presentation of results of operations, financial position and cash flows in conformity with GAAP. Operating results from interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of our results for the interim periods presented. Certain prior period amounts have been reclassified to conform to the 2013 presentation.

On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's Therapeutic Support Systems ("TSS") business (the “Agreement”). The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. In accordance with the Codification, depreciation and amortization of the long-lived assets subject to the Agreement ceased as of August 15, 2012. Additionally, the results of the operations subject to the Agreement, excluding the allocation of general corporate overhead, are presented as discontinued operations in the condensed consolidated statements of operations for all periods presented. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

The Company has two reportable operating segments which correspond to our two global businesses: KCI and LifeCell Corporation ("LifeCell"). We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region.

The condensed consolidated financial statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

(b)Derivative Financial Instruments and Fair Value Measurements

We use derivative financial instruments to manage the economic impact of fluctuations in interest rates. We do not use financial instruments for speculative or trading purposes. Periodically, we enter into interest rate protection agreements to modify the interest characteristics of our outstanding debt. Our interest rate derivatives have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period.

We also use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates on our intercompany balances and corresponding cash flows and to manage our transactional currency exposures when our foreign subsidiaries enter into transactions denominated in currencies other than their local currency. We enter into foreign currency exchange contracts to manage these economic risks. These contracts are not designated as hedges; as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. Although we use master netting agreements with our derivative counterparties, we do not offset derivative asset and liability positions in the condensed consolidated balance sheets.

All derivative instruments are recorded on the balance sheets at fair value. The fair values of our interest rate derivatives and foreign currency exchange contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly-quoted markets, which represent level 2 inputs as defined by the Codification.

8

(c)Concentration of Credit Risk

We have a concentration of credit risk with financial institutions related to our derivative instruments. As of September 30, 2013, Morgan Stanley, UBS and HSBC were the counterparties on our interest rate protection agreements consisting of interest rate swap and cap agreements in notional amounts totaling $1.031 billion each. We use master netting agreements with our derivative counterparties to reduce our risk and use multiple counterparties to reduce our concentration of credit risk.

We maintain cash and cash equivalents with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits bear minimal credit risk as they are maintained at financial institutions of reputable credit and generally may be redeemed upon demand.

(d)Recently Adopted Accounting Standards

In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

(e)   Long-Lived Assets

When an event occurs that indicates the carrying value of long-lived assets might not be recoverable, we review property, plant and equipment for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. During the first nine months of 2013, we recorded a $30.3 million fixed asset impairment charge.

(f)Goodwill and Other Intangible Assets

Goodwill represents the excess purchase price over the fair value of net assets acquired. Goodwill is tested for impairment by reporting unit annually, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Impairment of goodwill is tested by comparing the carrying value of the reporting unit to the reporting unit’s fair value. The carrying value of each reporting unit is determined by taking the reported net assets of the consolidated entity, identifying reporting unit specific assets (including goodwill) and liabilities and allocating shared operational and administrative assets and liabilities to the appropriate reporting unit, which is the same as the segment to which they are assigned. The fair value of each reporting unit is determined using discounted cash flow models using certain performance assumptions and appropriate discount rates determined by our management. To ensure the reasonableness of the estimated fair value of our reporting units, we also consider current industry market multiples. When it is determined that the carrying value of goodwill may not be recoverable based upon the existence of one or more of the above indicators of impairment, the measurement of any impairment is determined and the carrying value is reduced as appropriate.

Identifiable intangible assets include developed technology, in process research and development, customer relationships, tradenames and patents. For intangible assets that are subject to amortization, we amortize the assets over the estimated economic or contractual life of the individual asset. When an event occurs that indicates the carrying value of definite-lived intangible assets might not be recoverable, we review the assets for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. Indefinite-lived intangibles are tested for impairment annually, or more frequently when events or changes in circumstances indicate that the assets might be impaired. If the carrying amount of the indefinite-lived intangible assets exceeds their fair value, an impairment is recognized in an amount equal to that excess.

9

The Company performed an interim impairment test on goodwill of its LifeCell reporting unit during the third quarter of 2013. In our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, we disclosed that in the event of an approximate 6% and 4% drop in the fair value of our LifeCell reporting unit and the fair value of our LifeCell identifiable intangible assets, respectively, the fair value of the LifeCell reporting unit and identifiable intangible assets would still exceed their book values as of October 31, 2012. The Company continued to monitor the close proximity of the reporting unit's carrying value compared to its fair value and, in the third quarter, determined it was required to complete the interim impairment test, as defined under GAAP. The results of the third quarter 2013 interim impairment test indicated that the estimated fair value of the LifeCell reporting unit was less than its carrying value; consequently, during the third quarter of 2013 we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

During the third quarter and first nine months of 2013, write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets were recorded due primarily to the discontinuation of certain projects.

(g)   Other Significant Accounting Policies

For further information on our significant accounting policies, see Note 1 of the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

NOTE 2.Business Acquisition

On July 30, 2013, KCI announced that it had signed a definitive share purchase agreement to acquire Systagenix, an established provider of advanced wound care ("AWC") products. The transaction closed on October 28, 2013. At the closing of the transaction, KCI paid a purchase price of $485.0 million, subject to adjustment, using $350.0 million of incremental borrowings under our existing senior secured credit facility along with cash on hand to fund the purchase price. The acquisition will be accounted for as a business combination using the acquisition method. Once our preliminary purchase price allocation has been completed, the purchase price will be allocated to the Systagenix tangible and identifiable intangible assets based on their estimated fair values as of the acquisition date. Any excess of the purchase price over the identifiable intangible and net tangible assets will be allocated to goodwill, which is not deductible for tax purposes.

Systagenix has a broad portfolio of innovative advanced wound care products with a focus on moist wound healing dressings - including PROMOGRAN PRISMA®, the collagen dressing market leader, TIELLE® (foam) and ADAPTIC® (non adherent contact layers). Systagenix's manufacturing, marketing and sales teams supply and distribute over 20 million advanced wound care dressings each month to more than 70 countries. The company, formerly part of Johnson & Johnson, generates annual revenue of approximately $200.0 million and has approximately 800 employees worldwide, including an experienced team of research and development scientists dedicated to advancing skin and wound care. Combining Systagenix's expertise with KCI's innovation pipeline and scale will create additional value for customers and help speed healing and reduce complications for patients.

NOTE 3.    Sale of Therapeutic Support Systems Assets

On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's TSS business. The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. The historical results of operations of the disposal group, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

The Company utilized the net proceeds from the sale to fund the acquisition of Systagenix and internal investments, which satisfied our reinvestment requirement. Therefore, we do not anticipate having a repayment requirement in the fourth quarter associated with the sale of our TSS business.

10

The operating results of the TSS product portfolio included in discontinued operations are as follows (in thousands):

	Three months ended September 30,					Nine months ended September 30,
	2013			2012		2013			2012
Revenue	$	—		$	52,673	$	—		$	168,107
Earnings (loss) before income tax expense (benefit)	$	(415	)	$	3,304	$	(3,738	)	$	(5,984	)
Income tax expense (benefit)	$	(160	)	$	1,272	$	(1,439	)	$	(2,304	)
Gain (loss) from discontinued operations, net of tax	$	(255	)	$	2,032	$	(2,299	)	$	(3,680	)

NOTE 4.Supplemental Balance Sheet Data

(a)Accounts Receivable, net

Accounts receivable consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Gross trade accounts receivable:
Billed trade accounts receivable	$	382,538		$	370,708
Unbilled receivables	49,350			45,466
Less:  Allowance for revenue adjustments	(69,546		)	(71,770		)
Gross trade accounts receivable	362,342			344,404
Less:  Allowance for bad debt	(7,017		)	(4,768		)
Net trade accounts receivable	355,325			339,636
Other receivables	13,575			16,082
	$	368,900		$	355,718

(b)   Inventories, net

Inventories consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Finished goods and tissue available for distribution	$	100,873		$	96,573
Goods and tissue in-process	9,325			12,421
Raw materials, supplies, parts and unprocessed tissue	66,033			45,993
	176,231			154,987
Less: Amounts expected to be converted into equipment for short-term rental	(14,118		)	(5,237		)
Reserve for excess and obsolete inventory	(12,127		)	(9,900		)
	$	149,986		$	139,850

11

NOTE 5.     Long-Term Debt

Long-term debt consists of the following (in thousands):

	September 30, 2013			December 31, 2012
Senior Dollar Term D-1 Credit Facility (1) – due 2018	$	1,601,607		$	1,613,700
Senior Euro Term D-1 Credit Facility (1) – due 2018	332,186			327,022
Senior Term D-2 Credit Facility (1) – due 2016	319,339			321,750
10.5% Second Lien Senior Secured Notes due 2018	1,750,000			1,750,000
12.5% Senior Unsecured Notes due 2019	612,000			650,000
3.25% Convertible Senior Notes due 2015	101			701
IBM Financing	2,271			—
Notional amount of debt	4,617,504			4,663,173
Senior Dollar Term D-1 Credit Facility Discount, net of accretion	(32,100		)	(33,840		)
Senior Euro Term D-1 Credit Facility Discount, net of accretion	(11,033		)	(13,353		)
Senior Term D-2 Credit Facility Discount, net of accretion	(4,860		)	(7,064		)
Second Lien Senior Secured Notes Discount, net of accretion	(25,160		)	(27,827		)
Senior Unsecured Notes Discount, net of accretion	(3,111		)	(3,594		)
Net discount on debt	(76,264		)	(85,678		)
Total debt, net of discount	4,541,240			4,577,495
Less:  Current installments	(24,101		)	(23,383		)
	$	4,517,139		$	4,554,112

_____________________________

(1) On June 14, 2013, we entered into Amendment No. 2 to our senior secured credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment.

Senior Secured Credit Facility

Our senior secured credit facility (the “Senior Secured Credit Facility”) includes a $200 million revolving credit facility (the “Revolving Credit Facility”). Amounts available under the Revolving Credit Facility are available for borrowing and reborrowing until maturity. At September 30, 2013 and December 31, 2012, no revolving credit loans were outstanding and we had outstanding letters of credit issued by banks which are party to the Senior Secured Credit Facility of $10.7 million and $11.5 million, respectively. In addition, we had $3.5 million and $4.6 million of letters of credit issued by a bank not party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The capacity of the Revolving Credit Facility is reduced for the $10.7 million and $11.5 million of letters of credit issued by banks which are party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The resulting availability under the Revolving Credit Facility was $189.3 million and $188.5 million at September 30, 2013 and December 31, 2012, respectively. Commitment fees accrue at a rate of 0.375% on the amounts available under the Revolving Credit Facility.

On June 14, 2013, we entered into Amendment No. 2 to our Senior Secured Credit Facility ("Amendment No. 2"). As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. In connection with Amendment No. 2, Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans were refinanced with Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, respectively.

In connection with our acquisition of Systagenix, we borrowed $350.0 million of incremental term D-1 loans (the "Incremental Loans") incurred pursuant to Amendment No. 3 to our Senior Secured Credit Facility, dated as of October 28, 2013. The Incremental Loans were issued at a discount of $0.4 million. The interest rate and all other terms are identical to our previously-existing Dollar Term D-1 Loans.

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Interest. Amounts outstanding under the Dollar Term D-1 Loans, the Term D-2 Loans and the Revolving Credit Facility (other than swing-line loans and unreimbursed drawings on letters of credit) bear interest, at our option, at a rate equal to either the base rate or the eurocurrency rate, in each case plus an applicable margin. Amounts outstanding under the Euro Term D-1 Loans bear interest at the eurocurrency rate, and swing-line loans and unreimbursed drawings on letters of credit bear interest at the base rate. As a result of Amendment No. 2, the new applicable margins are (i) for eurocurrency rate loans that are Dollar Term D-1 Loans, 3.50%, (ii) for base rate loans that are Dollar Term D-1 Loans, 2.50%, (iii) for eurocurrency rate loans that are Euro Term D-1 Loans, 3.75%, (iv) for base rate loans that are Euro Term D-1 Loans, 2.75%, (v) for eurocurrency rate loans that are Term D-2 Loans, 3.00%, and (vi) for base rate loans that are Term D-2 Loans, 2.00%. The Term D loans will have a eurocurrency rate floor of 1.00% and a base rate floor of 2.00%.

10.5% Second Lien Senior Secured Notes and 12.5% Senior Unsecured Notes

As required upon the closing of our 10.5% Second Lien Senior Secured Notes due 2018 (“10.5% Second Lien Notes”) and the 12.5% Senior Unsecured Notes due 2019 (“12.5% Unsecured Notes”), we have entered into registration rights agreements with respect to these notes. Pursuant to the terms of the registration rights agreements, we filed a registration statement (the “Registration Statement”) with respect to a registered exchange offer to exchange such notes for new notes with terms substantially identical in all material respects with the notes (except for the provisions relating to the transfer restrictions and payment of additional interest). On February 13, 2013, our Registration Statement was declared effective by the Securities and Exchange Commission (“SEC”), and our exchange offer was completed on March 15, 2013.

Because our Registration Statement was not declared effective by the SEC under the Securities Act and the exchange offer was not consummated within 365 days following the issuance of the notes (“Exchange Date”), and because we did not file a shelf registration statement covering resales of the notes within 30 days after the Exchange Date (each a “Notes Registration Default”), additional interest accrued on the aggregate principal amount of the notes from and including the date on which any such Notes Registration Default occurred to but excluding the date on which the Notes Registration Defaults were cured through the completion of the exchange offer. Under the terms of the registration rights agreements entered into with respect to these notes, additional interest was accrued at a rate of 0.25% and 0.50% from November 4, 2012 to February 4, 2013 and February 5, 2013 to March 15, 2013, respectively.

During the nine months ended September 30, 2013, we repurchased $38.0 million in principal of our 12.5% Unsecured Notes.

Covenants

As of September 30, 2013, we were in compliance with all covenants under our Senior Secured Credit Facility, 10.5% Second Lien Notes, 12.5% Unsecured Notes, and 3.25% Convertible Senior Notes due 2015 (“the Convertible Notes”).

For further information on our long-term debt, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

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NOTE 6.     Derivative Financial Instruments and Fair Value Measurements

We are exposed to credit loss in the event of nonperformance by counterparties to the extent of the fair values of the outstanding interest rate swap agreements, interest rate cap agreements and foreign currency exchange contracts, but we do not anticipate nonperformance by any of the counterparties. All derivative instruments are recorded on the balance sheets at fair value. We do not use financial instruments for speculative or trading purposes.

Interest Rate Protection

At September 30, 2013 and December 31, 2012, we had three interest rate swap agreements to convert a portion of our outstanding variable rate debt to a fixed rate basis. These agreements become effective in December 2013, have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. The interest rate swap agreements have quarterly interest payments, receive rates based on the higher of three-month USD LIBOR or 1.25% and pay rates based on fixed rates, due on the last day of March, June, September and December. Once effective, the aggregate notional amount decreases quarterly by amounts ranging from $1.7 million to $56.4 million until maturity.

The following table summarizes our interest rate swap agreements (dollars in thousands):

Effective Dates	Original Notional Amount	Fixed Interest Rate
12/31/13-12/31/16	$512,633	2.256%
12/31/13-12/31/16	$512,633	2.249%
12/31/13-12/31/16	$512,633	2.250%

As of September 30, 2013 and December 31, 2012, we had interest rate cap agreements with initial notional amounts of $1.6 billion at a cost of $2.2 million that effectively limited the eurocurrency interest rate to 2% on a portion of the borrowings under our Senior Secured Credit Facility. The interest rate cap agreements expire on December 31, 2013.

Foreign Currency Exchange Rate Mitigation

At September 30, 2013 and December 31, 2012, we had foreign currency exchange contracts to sell or purchase $34.8 million and $59.1 million, respectively, of various currencies.

Fair Value Measurements

The Codification definesfair value as the exit price that would be received to sell an asset or paid to transfer a liability. The Fair Value Measurements and Disclosure topic of the Codification establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amount reported in the balance sheets for cash and cash equivalents, accounts receivable, accounts payable and long-term obligations, excluding our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt, including the 10.5% Second Lien Secured Notes, the 12.5% Unsecured Notes and the Convertible Notes approximates fair value. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.6 billion, respectively, at September 30, 2013. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.4 billion, respectively, at December 31, 2012. The fair value of our long-term debt was estimated based upon open-market trades at or near year end.

All of our derivatives, as of the reporting date, use inputs considered as Level 2. The interest rate swap agreements and interest rate cap agreements are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing interest rates and related forward interest rate curves. The foreign currency exchange contracts are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing foreign currency exchange rates and related foreign currency exchange rate curves.

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The following table sets forth the location and aggregate fair value amounts of all derivative instruments with credit-related contingent features (in thousands):

	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	Fair Value				Balance Sheet Location	Fair Value
		September 30, 2013		December 31, 2012			September 30, 2013		December 31, 2012
Derivatives not designated as hedging instruments
Interest rate swap agreements	Prepaid expenses and other	$	—	$	—	Accrued expenses and other	$	330	$	—
Interest rate swap agreements	Other non-current assets	—		—		Other non-current liabilities	30,482		34,868
Interest rate cap agreements	Prepaid expenses and other	—		9		Accrued expenses and other	—		—
Foreign currency exchange contracts	Prepaid expenses and other	230		520		Accrued expenses and other	1,008		2,980
Total derivatives		$	230	$	529		$	31,820	$	37,848

The following table summarizes the amount of gain (loss) on derivatives not designated as hedging instruments (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Interest rate swap agreements	$	(5,195	)	$	(6,313	)	$	4,057		$	(24,610	)
Interest rate cap agreements	(4		)	(118		)	(9		)	(1,563		)
Foreign currency exchange contracts	(1,641		)	(2,148		)	(848		)	(2,300		)
	$	(6,840	)	$	(8,579	)	$	3,200		$	(28,473	)

Certain of our derivative instruments contain provisions that require compliance with the restrictive covenants of our Senior Secured Credit Facility. For further information regarding the restrictive covenants of credit facilities, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

If we default under our credit facilities, the lenders could require immediate repayment of the entire principal. If those lenders require immediate repayment, we may not be able to repay them which could result in the foreclosure of substantially all of our assets. In these circumstances, the counterparties to the derivative instruments could request immediate payment or full collateralization on derivative instruments in net liability positions. Certain of our derivative counterparties are also parties to our Senior Secured Credit Facility.

No collateral has been posted by us in the normal course of business. If the credit-related contingent features underlying these agreements were triggered on September 30, 2013, we could be required to settle or post the full amount as collateral to the respective agreement counterparties.

We did not have any measurements of financial assets or financial liabilities at fair value on a nonrecurring basis at September 30, 2013 or December 31, 2012.

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NOTE 7. Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss are as follows (in thousands):

	Accumulated Foreign Currency Translation Adjustment			Investment Gain		Accumulated Other Comprehensive Income (Loss)
Balances at December 31, 2012	$	(517	)	$	—	$	(517	)
Unrealized investment gain, net of tax expense of $1,413	—			2,257		2,257
Foreign currency translation adjustment, net of tax benefit of $259	(9,266		)	—		(9,266		)
Balances at September 30, 2013	$	(9,783	)	$	2,257	$	(7,526	)

During the nine months ended September 30, 2013, there were no reclassification adjustments out of accumulated other comprehensive loss to net loss.

NOTE 8.Commitments and Contingencies

LEGAL PROCEEDINGS

Intellectual Property Litigation

As the owner and exclusive licensee of patents, from time to time, we are a party to proceedings challenging these patents, including challenges in U.S. federal courts, foreign courts, foreign patent offices and the U.S. Patent and Trademark Office. Additionally, from time to time, we are a party to litigation we initiate against others we contend infringe these patents, which often results in counterclaims regarding the validity of such patents. At other times, we are party to litigation initiated by others who contend we infringe their patents. It is not possible to reliably predict the outcome of the proceedings described below. However, if we are unable to effectively enforce our intellectual property rights, third parties may become more aggressive in the marketing of competitive products around the world.

Smith & Nephew Litigation

In 1993, KCI exclusively licensed several patent applications from Wake Forest University relating to negative pressure wound therapy (“NPWT”) that ultimately issued in several countries. In the following years, KCI developed and began marketing V.A.C.^® Therapy, the first commercially available NPWT system. In 2003, BlueSky Medical launched the first competitive NPWT system. Unlike KCI, BlueSky commercialized a gauze-based system that utilized pumps manufactured by Medela AG (“Medela”). Shortly thereafter, KCI and Wake Forest sued BlueSky and Medela for infringement of the patents KCI licensed from Wake Forest. Following a jury trial in the Federal District Court for the Western District of Texas (“Western District”) in 2006, a judgment was entered holding that BlueSky's gauze-based NPWT system did not infringe these patents. That judgment was appealed to the United States Court of Appeals for the Federal Circuit (“Federal Circuit”), which affirmed the judgment of the trial court. In April 2007, Smith & Nephew PLLC acquired BlueSky and began commercializing NPWT products. Shortly thereafter, in May 2007, KCI and Wake Forest filed a patent infringement lawsuit against Smith & Nephew asserting patent infringement. In January 2009, Smith & Nephew launched a foam-based NPWT system at which point KCI and Wake Forest amended their claims against Smith & Nephew to assert additional patent claims. This case was tried by a jury in February 2010. Following the trial, the jury found that the patent claims asserted were not invalid and also found that Smith & Nephew was infringing the asserted patent claims. However, in October 2010, the Western District granted a motion for judgment as a matter of law filed by Smith & Nephew and entered an order invalidating the Wake Forest patent claims asserted in the case. This decision followed the revocations of the UK and German equivalents of the Wake Forest patents and was later followed by the revocation of the Australian equivalent. The litigation resulting in these revocations is detailed below. Wake Forest appealed this decision to the Federal Circuit.

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On August 13, 2012, the Court of Appeals for the Federal Circuit reversed the judgment of the District Court in the Smith & Nephew litigation, and remanded the case for resolution of several outstanding motions. The Court of Appeals ruled that the trial court was bound by the jury's advisory verdict on the legal question of obviousness because there was sufficient evidence to support the factual questions that were posed to them. It did not construe any prior art or rule that the patent claims are valid as a matter of law; rather, it held that Smith & Nephew failed to carry its burden of persuasion. Smith & Nephew subsequently filed a motion for rehearing en banc at the Federal Circuit Court of Appeals, arguing that the trial court cannot be bound by the advisory verdict of the jury on obviousness, because obviousness is a question of law. At least four amicus briefs were filed, including one from the Federal Circuit Bar Association, in support of Smith & Nephew's position. On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed.

Wake Forest Litigation

Since at least 2009, a host of companies began offering NPWT systems, both gauze-based and foam-based, across the globe. None of these companies licensed the Wake Forest patents prior to commercializing their products. To the contrary, several succeeded in having the patents declared invalid. These proceedings are also detailed herein.

In light of the multiple rulings declaring the patents invalid, KCI reassessed the validity of the patents anddetermined that continued payment of the royalties scheduled under the 1993 license agreement with Wake Forest was inappropriate. KCI withdrew from the Smith & Nephew litigation and on February 28, 2011, filed suit in the Western District of Texas seeking a declaratory judgment that, among other things, KCI no longer owes royalties to Wake Forest because the relevant patent claims are invalid or not infringed. Historical royalties under the license agreement, although disputed, were accrued through February 27, 2011 and are reflected in our consolidated financial statements. For the year ended December 31, 2010, royalty payments accrued or paid to Wake Forest under the license agreement totaled approximately $86 million. No royalty payments have been made to Wake Forest since July, 2010.

On March 18, 2011, Wake Forest provided KCI with written notice of termination of the license agreement and filed suit in Forsyth County Superior Court, North Carolina, alleging breach of contract by KCI. In its termination notice, Wake Forest demanded that KCI cease manufacturing and selling licensed products. KCI subsequently removed that action from state court to the Federal District Court for the Middle District of North Carolina, after which Wake Forest amended its complaint to add allegations of patent infringement. KCI moved to have the North Carolina case transferred to the Western District of Texas, and on August 26, 2011, the case was transferred to the Western District, where it was consolidated with KCI's existing suit. The Western District case was stayed pending a decision by the Court of Appeals for the Federal Circuit in the Smith & Nephew litigation described above.

On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed, and the stay in the case between KCI and Wake Forest was lifted. The case has been set for trial in April 2014. In January and February of 2013, Wake Forest and KCI filed their respective answers and counterclaims against each other. KCI is alleging breach of contract against Wake Forest for its refusal to negotiate in good faith to reduce the royalty rate under the license agreement following the several patent invalidity rulings and subsequent loss of market share by KCI. Because of the multiple rulings declaring the patents invalid and the August 13, 2012 decision in the Smith & Nephew litigation does not construe any prior art or rule that the patent claims are valid as a matter of law, KCI's assessment that the Wake Forest patents are invalid or not infringed by KCI's products has not changed. We continue to vigorously defend our positions in the case and KCI will continue to manufacture and sell V.A.C.® Therapy products. It is not possible to predict the outcome of this litigation nor is it possible to estimate any damages that may be awarded if we are unsuccessful in the litigation. We believe that any damages awarded as a reasonable royalty in this case would be substantially less than our previous royalty obligation to Wake Forest because the prior license agreement provided KCI with worldwide exclusive rights, whereas any infringement damages in the case would be based on US non-exclusive rights. We also believe our counter-claims against Wake Forest could further reduce our potential exposure to a damages award in the event we are unsuccessful on the liability issues of the case.

Because KCI believes the Wake Forest patents are invalid, KCI has not continued to enforce the Wake Forest Patents against alleged infringers. Instead, KCI has withdrawn from each of the cases described below that involve the Wake Forest patents.

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Other US Intellectual Property Litigation

In May 2007, contemporaneous with the filing of the lawsuit against Smith & Nephew which is detailed above, KCI and Wake Forest filed a case against Medela, for the manufacture, use and sale of NPWT products alleging infringement of the Wake Forest patents. Medela responded by alleging, among other things, that the Wake Forest patents are invalid. Following the October 2010 judgment invalidating the claims in the Wake Forest patents, the case against Medela was stayed. Because KCI believes the Wake Forest patents are invalid, KCI filed an unopposed motion to withdraw from the case, which was granted by the court in February 2013. On May 14, 2013, Wake Forest and Medela filed a stipulation of dismissal with prejudice following settlement of the disputes between them.

In January 2008, KCI and Wake Forest filed a patent infringement lawsuit against Innovative Therapies, Inc. (“ITI”) in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device introduced by ITI in 2007 infringed three Wake Forest patents. ITI responded by alleging, among other things, that the Wake Forest patents are invalid. Because KCI believes the Wake Forest patents are invalid, KCI filed a motion to dismiss its claims against ITI which the Court granted on August 30, 2013.

In December 2008, KCI, its affiliates and Wake Forest filed a patent infringement lawsuit against Boehringer Wound Systems, LLC, Boehringer Technologies, LP, and Convatec, Inc. in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device manufactured by Boehringer and commercialized by Convatec infringed Wake Forest patents. In February 2009, the defendants filed their answer which includes affirmative defenses and counterclaims alleging non-infringement and invalidity of the Wake Forest patents. On June 3, 2013, the parties filed a stipulation of Dismissal with Prejudice.

In August 2013, Vital Needs International, L.P. ("Vital Needs") filed a Demand for Arbitration with the American Arbitration Association seeking to recover $100 million in damages against Kinetic Concepts, Inc. and KCI Licensing, Inc. based on a number of claims related to certain intellectual property rights sold by Vital Needs to KCI pursuant to an Acquisition Agreement dated June 2, 2006. Vital Needs alleges, among other things, breach of the Acquisition Agreement for failure to pay royalties on sales of KCI products. We do not believe any royalties are owed to Vital Needs for sales of KCI products, and we believe our defenses to Vital Needs' claims are meritorious. We intend to vigorously defend the arbitration, which is in its initial phase.

International Intellectual Property Litigation

In June 2007, Medela filed a patent nullity suit in the German Federal Patent Court against Wake Forest's German patent corresponding to European Patent No. EP0620720 (“the '720 Patent”). In March 2008 and February 2009, Mölnlycke Health Care AB and Smith & Nephew, respectively, joined the nullity suit against the '720 Patent. In March 2009, the German Federal Patent Court ruled that the claims of the '720 Patent were invalid and revoked the German patent corresponding to the '720 Patent. A hearing on Wake Forest's appeal, previously set for April 26, 2012 was postponed and reset for February 13, 2013. The nullity complaints were withdrawn the morning of the scheduled hearing pursuant to a settlement between Wake Forest and the nullity plaintiffs, and the hearing did not take place. Although the patent's statutory term expired in November 2012, the withdrawal of the nullity complaints resulted in a reinstatement of the '720 Patent in Germany. As a result, on July 10, 2013, KCI filed a separate suit to nullify the German part of the '720 Patent.

In March 2009, KCI and its affiliates and Wake Forest filed a patent infringement lawsuit asserting the Australian counterpart to the Wake Forest Patents against Smith & Nephew in the Federal Court of Australia, requesting preliminary injunctive relief to prohibit the commercialization of a Smith & Nephew negative pressure wound therapy dressing kit. A full trial on validity and infringement of the Wake Forest patent involved in the case was held in 2010. In September 2011, the Federal Court ruled the asserted claims to be invalid and not infringed by Smith & Nephew's product. Wake Forest appealed the decision and oral arguments were heard before the appellate court in May 2012. Following the settlement between Wake Forest and Smith & Nephew described above, the Federal Court dismissed the appeal on November 30, 2012 without addressing Wake Forest's appeal, and remitted the case to the lower court for costs and damages relating to the initial action filed in 2009. The dismissal renders the ruling of non-infringement and invalidity of the asserted claims final. The patent's statutory term expired in November 2012.

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LifeCell Litigation

AlloDerm Cases

LifeCell Corporation is a party to approximately 330 lawsuits filed by individuals alleging personal injury and seeking monetary damages for failed hernia repair procedures using LifeCell Corporation's AlloDerm products. These cases have been consolidated for case management purposes in Middlesex County, New Jersey. The cases are in the early stages of litigation, and none have been set for trial. Although it is not possible to reliably predict the outcome of the litigation, we believe that our defenses to these claims are meritorious and we will defend against these suits vigorously. We have insurance that covers these claims and lawsuits. Recently, we resolved a dispute with our primary products liability carrier and these consolidated cases are being treated as a single occurrence and therefore do not require the exhaustion of a separate self-insured retention to trigger coverage. Based on our existing insurance coverage and our defenses to these cases, we do not expect them to have a material impact on our results of operations or our financial position. As these cases are in their early stages with much discovery still to be conducted, the plaintiffs have yet to set forth their alleged damages. As such, it is impossible for the Company to predict or estimate potential losses if our defenses to these cases are unsuccessful.

Repliform Cases

LifeCell Corporation has recently been named in approximately 80 lawsuits in Middlesex County, Massachusetts, but has been served with only 40 of the suits. In addition, LifeCell has been sued in State court in Delaware and Minnesota, as well as federal district court in Minneapolis and the Northern District of Texas. The cases were filed by individuals alleging personal injury and seeking monetary damages for failed gynecological procedures using products sold by Boston Scientific. The LifeCell cases in Middlesex County, Massachusetts were filed in the M Session of the Superior Court, which consists of a number of cases involving Boston Scientific synthetic mesh products. We do not believe LifeCell is a proper party to these lawsuits and are therefore seeking to dismiss these suits. In the event the suits are not dismissed we intend to defend these suits vigorously. We likewise intend to defend the non-Massachusettes cases vigorously. We have insurance that covers these claims and lawsuits.

LifeNet Health Case

On September 6, 2013, LifeNet Health ("LifeNet") filed suit against LifeCell Corporation in the United States District Court for the Eastern District of Virginia, Norfolk Division. LifeNet alleges that two LifeCell products, Strattice™ Reconstructive Tissue Matrix and AlloDerm®RTM Ready to Use, infringe LifeNet’s U.S. Patent No. 6,569,200 ("the ‘200 Patent"). LifeNet alleges that LifeCell has been aware of the ‘200 Patent and its infringement since 2009 and acted willfully in continuing to infringe the ‘200 Patent thereafter. LifeNet seeks monetary damages including treble damages for willful infringement, together with costs and prejudgment and post judgment interest as well as a finding that the case is exceptional and an award of costs and reasonable attorneys fees. LifeCell was served with the complaint on October 15, 2013 and intends to vigorously defend this case.

Other Litigation

In February 2009, KCI received a subpoena from the U.S. Department of Health and Human Services Office of Inspector General (“OIG”) seeking records regarding our billing practices under the local coverage policies of the four regional Durable Medical Equipment Medicare Administrative Contractors (“DME MACs”). KCI cooperated with the OIG's inquiry and provided substantial documentation to the OIG and the U.S. Attorneys' office in response to its request. The government's inquiry stemmed from the filing under seal of two qui tam actions against KCI on March 20, 2008 and September 29, 2008 by two former employees in the U.S. District Court, Central District of California, Western Division.  These cases are captioned United States of America, ex rel. Steven J. Hartpence v. Kinetic Concepts, Inc. et al ("Hartpence Matter") and United States of America, ex rel. Geraldine Godecke v. Kinetic Concepts, Inc., et al ("Godecke Matter"). The complaints contend that KCI violated the Federal False Claims Act by billing in a manner that was not consistent with the Local Coverage Determinations issued by the DME MACs and seek recovery of monetary damages. Following the completion of the government's review and its decision declining to intervene in such suits, the live pleadings were ordered unsealed on May 3, 2011.  After reviewing the allegations, KCI filed motions seeking the dismissal of the suits on multiple grounds.  On January 30, 2012, the Court granted KCI's motions dismissing all of the claims in the Hartpence Matter and dismissing all of the claims in the Godecke Matter with the exception of a retaliation claim, which has been stayed pending the appeal of the dismissed claims.  On February 27, 2012 and June 15, 2012, respectively, Hartpence and Godecke each filed a Notice of Appeal to the U.S. Court of Appeals for the Ninth Circuit seeking to reverse the dismissal of their claims by the trial court.  On December 11, 2012, KCI moved the Ninth Circuit to disqualify counsel in the Hartpence and Godecke matters from representing relators on appeal due to their possession and use of KCI's privileged documents.  The Ninth Circuit granted the parties agreed motion to stay the briefing of the merits of the appeals pending resolution of the disqualification motion and on February 25, 2013, remanded KCI's disqualification motion to the U.S. District Court for disposition. On May 20, 2013, the District Court granted KCI's disqualification motions and counsel for both Godecke and Hartpence were disqualified.

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On July 19, 2013 the Ninth Circuit Court of Appeals issued an Order requiring counsel for Godecke and Hartpence to withdraw from the appeals or show cause why they should not be disqualified. Godecke and Hartpence have retained new counsel to represent them on appeal. The Ninth Circuit has not issued a briefing schedule.

We are a party to several additional lawsuits arising in the ordinary course of our business. Additionally, the manufacturing and marketing of medical products necessarily entails an inherent risk of product liability claims. We maintain multiple layers of product liability insurance coverage and we believe these policies and the amounts of coverage are appropriate and adequate.

OTHER COMMITMENTS AND CONTINGENCIES

As a healthcare supplier, we are subject to extensive government regulation, including laws and regulations directed at ascertaining the appropriateness of reimbursement, preventing fraud and abuse and otherwise regulating reimbursement under various government programs. The marketing, billing, documenting and other practices are all subject to government oversight and review. To ensure compliance with Medicare and other regulations, regional carriers often conduct audits and request patient records and other documents to support claims submitted by us for payment of services rendered to customers.

We also are subject to routine pre-payment and post-payment audits of medical claims submitted to Medicare. These audits typically involve a review, by Medicare or its designated contractors and representatives, of documentation supporting the medical necessity of the therapy provided by us. While Medicare requires us to obtain a comprehensive physician order prior to providing products and services, we are not required to, and do not as a matter of practice require, or subsequently obtain, the underlying medical records supporting the information included in such claim. Following a Medicare request for supporting documentation, we are obligated to procure and submit the underlying medical records retained by various medical facilities and physicians. Obtaining these medical records in connection with a claims audit may be difficult or impossible and, in any event, all of these records are subject to further examination and dispute by an auditing authority. Under standard Medicare procedures, we are entitled to demonstrate the sufficiency of documentation and the establishment of medical necessity, and we have the right to appeal any adverse determinations. If a determination is made that our records or the patients' medical records are insufficient to meet medical necessity or Medicare reimbursement requirements for the claims subject to a pre-payment or post-payment audit, we could be subject to denial, recoupment or refund demands for claims submitted for Medicare reimbursement. In the event that an audit results in discrepancies in the records provided, Medicare may be entitled to extrapolate the results of the audit to make recoupment demands based on a wider population of claims than those examined in the audit.

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NOTE 9.Segment Information

The Company is engaged in the rental and sale of advanced wound care systems and regenerative medicine products and has operations in more than 25 countries. We have two reportable operating segments which correspond to our two global businesses: KCI and LifeCell. Our two global operating segments also represent our reporting units as defined by the Codification. In most countries where we operate, certain aspects of our two businesses are supported by the same administrative staff, systems and infrastructure and, as such, we have allocated these costs between the businesses based on allocation methods including headcount, revenue and other methods as deemed appropriate. We measure segment profit (loss) as operating earnings (loss), which is defined as income (loss) before interest and other income, interest expense, foreign currency gains and losses, derivative instruments gains and losses and income taxes. All intercompany transactions are eliminated in computing revenue and operating earnings (loss).

On November 8, 2012, Getinge purchased certain assets and assumed certain liabilities comprising KCI's TSS product business. The historical results of operations of the TSS business, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

Information on segments and a reconciliation of consolidated totals are as follows (in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Revenue:
KCI	$	320,879		$	329,651		$	944,526		$	986,157
LifeCell	119,682			106,222			344,598			320,364
Total revenue	$	440,561		$	435,873		$	1,289,124		$	1,306,521
Operating earnings (loss):
KCI	$	126,837		$	114,833		$	327,018		$	277,191
LifeCell	30,093			28,864			91,159			75,503
Non-allocated costs:
General headquarter expense (1)	(6,335		)	(5,520		)	(59,447		)	(19,545		)
Equity-based compensation	(850		)	(197		)	(2,046		)	(1,186		)
Merger and restructuring-related expenses (2)	(31,112		)	(21,684		)	(97,518		)	(63,750		)
Acquired intangible asset amortization (3)	(45,099		)	(49,733		)	(138,969		)	(172,260		)
Impairment of goodwill and intangible assets (4)	(443,400		)	—			(443,400		)	—
Total non-allocated costs	(526,796		)	(77,134		)	(741,380		)	(256,741		)
Total operating earnings (loss)	$	(369,866	)	$	66,563		$	(323,203	)	$	95,953

_____________________________

(1) The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product.

(2) Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses.

(3) Includes amortization of acquired intangible assets related to our Merger in November 2011.

(4) During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

21

NOTE 10.Guarantor Condensed Consolidating Financial Statements

Our 10.5% Second Lien Notes and 12.5% Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, by us and each of our material 100% owned subsidiaries, other than the subsidiaries that are co-issuers of the notes, foreign subsidiaries and subsidiaries whose only assets are investments in foreign subsidiaries. The non-guarantor subsidiaries do not have any payment obligations under the 10.5% Second Lien Notes or 12.5% Unsecured Notes. Subject to the terms of the10.5% Second Lien Notes and 12.5% Unsecured Notes indentures, the guarantee of a subsidiary guarantor will terminate upon:

(1) a sale or other disposition (including by way of consolidation or merger) of the capital stock of such guarantor or the sale or disposition of all or substantially all the assets of such subsidiary guarantor (other than to the Company or a restricted subsidiary) otherwise permitted by the 10.5% Second Lien Notes or 12.5% Unsecured Notes indentures,

(2) the designation in accordance with the10.5% Second Lien Notes or 12.5% Unsecured Notes indenture of the guarantor as an unrestricted subsidiary or the occurrence of any event after which the guarantor is no longer a restricted subsidiary,

(3) defeasance or discharge of the10.5% Second Lien Notes or 12.5% Unsecured Notes, or

(4) upon the achievement of investment grade status by the10.5% Second Lien Notes or 12.5% Unsecured Notes; provided that such guarantee shall be reinstated upon the reversion date.

In the event of a bankruptcy, liquidation or reorganization of any non-guarantor subsidiary, such non-guarantor subsidiary will pay the holders of its debt and other liabilities, including its trade creditors, before it will be able to distribute any of its assets to us. In the future, any non-U.S. subsidiaries, immaterial subsidiaries and subsidiaries that we designate as unrestricted subsidiaries under the 10.5% Second Lien Notes and 12.5% Unsecured Notes indentures will not guarantee the 10.5% Second Lien Notes or 12.5% Unsecured Notes. As of September 30, 2013, there were no restrictions on the ability of subsidiary guarantors to transfer funds to the parent company.

As a result of the guarantee arrangements, we are presenting the following condensed consolidated balance sheets, statements of operations and comprehensive income (loss), and statements of cash flows of the issuer, the guarantor subsidiaries and the non-guarantor subsidiaries.

22

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

September 30, 2013

(in thousands)

(unaudited)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	138,790		$	—	$	223,731		$	—		$	362,919
Accounts receivable, net	—		184,370			73,382		111,148			—			368,900
Inventories, net	—		63,219			92,060		78,178			(83,471		)	149,986
Prepaid expenses and other	—		41,376			5,913		342,209			(329,999		)	59,499
Intercompany receivables	166		1,400,317			2,270,890		149,321			(3,820,694		)	—
Total current assets	564		1,828,072			2,442,245		904,587			(4,234,164		)	941,304
Net property, plant and equipment	—		297,648			82,391		197,071			(264,555		)	312,555
Debt issuance costs, net	—		101,766			—		—			—			101,766
Deferred income taxes	—		—			—		21,866			—			21,866
Goodwill	—		2,483,240			724,335		—			—			3,207,575
Identifiable intangible assets, net	—		380,314			1,809,207		154,004			—			2,343,525
Other non-current assets	—		424			186		94,344			(90,900		)	4,054
Intercompany loan receivables	—		785,000			404,586		—			(1,189,586		)	—
Intercompany investments	948,376		406,067			406,253		—			(1,760,696		)	—
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	16,089		$	12,540	$	15,898		$	—		$	44,527
Accrued expenses and other	—		234,359			238,528		61,948			(182,932		)	351,903
Intercompany payables	3,934		788,613			2,508,621		519,526			(3,820,694		)	—
Current installments of long-term debt	—		22,760			1,341		—			—			24,101
Income taxes payable	—		1,495			—		(1,495		)	—			—
Deferred income taxes	—		(34,267		)	42,519		(3,642		)	—			4,610
Total current liabilities	3,934		1,029,049			2,803,549		592,235			(4,003,626		)	425,141
Long-term debt, net of current installments and discount	—		4,516,223			916		—			—			4,517,139
Non-current tax liabilities	—		42,084			—		4,377			—			46,461
Deferred income taxes	—		56,892			852,886		50,441			—			960,219
Other non-current liabilities	218		37,242			298		1,139			—			38,897
Intercompany loan payables	—		402,433			785,000		2,153			(1,189,586		)	—
Total liabilities	4,152		6,083,923			4,442,649		650,345			(5,193,212		)	5,987,857
Total equity	944,788		198,608			1,426,554		721,527			(2,346,689		)	944,788
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645

23

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

December 31, 2012

(in thousands)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	276,788		$	—	$	105,964	$	—		$	383,150
Accounts receivable, net	—		174,534			58,244		122,940		—			355,718
Inventories, net	—		94,345			71,676		60,635		(86,806		)	139,850
Deferred income taxes	—		38,451			—		3,642		(42,093		)	—
Prepaid expenses and other	—		25,083			6,591		294,437		(286,600		)	39,511
Intercompany receivables	166		1,337,915			2,149,981		147,473		(3,635,535		)	—
Total current assets	564		1,947,116			2,286,492		735,091		(4,051,034		)	918,229
Net property, plant and equipment	—		281,950			79,049		190,419		(162,936		)	388,482
Debt issuance costs, net	—		96,476			—		—		—			96,476
Deferred income taxes	—		—			—		20,003		—			20,003
Goodwill	—		2,483,240			996,535		—		—			3,479,775
Identifiable intangible assets, net	—		441,620			2,045,091		179,490		—			2,666,201
Other non-current assets	—		324			186		95,988		(90,900		)	5,598
Intercompany loan receivables	—		800,000			366,134		—		(1,166,134		)	—
Intercompany investments	1,459,261		302,027			409,702		—		(2,170,990		)	—
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	17,869		$	13,093	$	10,008	$	—		$	40,970
Accrued expenses and other	—		172,356			236,838		62,226		(187,257		)	284,163
Intercompany payables	2,361		723,096			2,389,863		520,215		(3,635,535		)	—
Current installments of long-term debt	—		23,383			—		—		—			23,383
Income taxes payable	—		(1,452		)	—		1,452		—			—
Deferred income taxes	—		—			99,621		—		(42,093		)	57,528
Total current liabilities	2,361		935,252			2,739,415		593,901		(3,864,885		)	406,044
Long-term debt, net of current installments and discount	—		4,554,112			—		—		—			4,554,112
Non-current tax liabilities	—		36,711			—		7,754		—			44,465
Deferred income taxes	—		115,652			888,597		65,231		—			1,069,480
Other non-current liabilities	68		41,360			375		1,464		—			43,267
Intercompany loan payables	—		366,135			800,000		—		(1,166,135		)	—
Total liabilities	2,429		6,049,222			4,428,387		668,350		(5,031,020		)	6,117,368
Total equity	1,457,396		303,531			1,754,802		552,641		(2,610,974		)	1,457,396
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764

24

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	155,893		$	1,513		$	33,635		$	—		$	191,041
Sales	—			77,659			224,426			159,142			(211,707		)	249,520
Total revenue	—			233,552			225,939			192,777			(211,707		)	440,561
Rental expenses	—			62,928			4,010			53,891			(35,083		)	85,746
Cost of sales	30			123,481			142,946			57,512			(257,818		)	66,151
Gross profit (loss)	(30		)	47,143			78,983			81,374			81,194			288,664
Selling, general and administrative expenses	820			66,834			44,169			40,261			(31		)	152,053
Research and development expenses	—			8,010			6,742			3,209			—			17,961
Acquired intangible asset amortization	—			19,625			17,907			7,584			—			45,116
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(850		)	(47,326		)	(433,235		)	30,320			81,225			(369,866		)
Non-operating intercompany transactions	—			(8,076		)	49,735			(60,212		)	18,553			—
Interest income and other	—			17,852			3,062			97			(20,794		)	217
Interest expense	—			(104,402		)	(17,756		)	(34		)	20,794			(101,398		)
Loss on extinguishment of debt	—			(200		)	—			—			—			(200		)
Foreign currency gain (loss)	—			(14,433		)	(38		)	5,733			—			(8,738		)
Derivative instruments loss	—			(6,840		)	—			—			—			(6,840		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(850		)	(163,425		)	(398,232		)	(24,096		)	99,778			(486,825		)
Income tax expense (benefit)	—			(51,104		)	(34,535		)	(2,880		)	—			(88,519		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(850		)	(112,321		)	(363,697		)	(21,216		)	99,778			(398,306		)
Equity in earnings (loss) of subsidiaries	(397,711		)	48,780			(20,950		)	—			369,881			—
Earnings (loss) from continuing operations	(398,561		)	(63,541		)	(384,647		)	(21,216		)	469,659			(398,306		)
Earnings (loss) from discontinued operations, net of tax	—			(331		)	(1		)	266			(189		)	(255		)
Net earnings (loss)	$	(398,561	)	$	(63,872	)	$	(384,648	)	$	(20,950	)	$	469,470		$	(398,561	)
Total comprehensive income (loss)	$	(403,151	)	$	(68,462	)	$	(389,238	)	$	(25,540	)	$	483,240		$	(403,151	)

25

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	164,641		$	1,741		$	40,774		$	—		$	207,156
Sales	—			74,943			103,716			151,225			(101,167		)	228,717
Total revenue	—			239,584			105,457			191,999			(101,167		)	435,873
Rental expenses	—			62,877			1,526			61,744			(25,337		)	100,810
Cost of sales	18			89,027			34,023			58,201			(122,656		)	58,613
Gross profit (loss)	(18		)	87,680			69,908			72,054			46,826			276,450
Selling, general and administrative expenses	191			75,731			32,926			33,978			(48		)	142,778
Research and development expenses	—			6,268			8,977			2,131			—			17,376
Acquired intangible asset amortization	—			22,308			18,687			8,738			—			49,733
Operating earnings (loss)	(209		)	(16,627		)	9,318			27,207			46,874			66,563
Non-operating intercompany transactions	—			5,318			132,861			(131,367		)	(6,812		)	—
Interest income and other	—			18,532			3,063			18			(21,439		)	174
Interest expense	—			(120,964		)	(18,375		)	(20		)	21,439			(117,920		)
Foreign currency gain (loss)	—			(6,651		)	170			1,223			—			(5,258		)
Derivative instruments loss	—			(8,579		)	—			—			—			(8,579		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(209		)	(128,971		)	127,037			(102,939		)	40,062			(65,020		)
Income tax expense (benefit)	—			(22,700		)	14,055			(18,531		)	—			(27,176		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(209		)	(106,271		)	112,982			(84,408		)	40,062			(37,844		)
Equity in earnings (loss) of subsidiaries	(35,603		)	28,741			(83,578		)	—			90,440			—
Earnings (loss) from continuing operations	(35,812		)	(77,530		)	29,404			(84,408		)	130,502			(37,844		)
Earnings (loss) from discontinued operations, net of tax	—			(1,468		)	627			830			2,043			2,032
Net earnings (loss)	$	(35,812	)	$	(78,998	)	$	30,031		$	(83,578	)	$	132,545		$	(35,812	)
Total comprehensive income (loss)	$	(34,215	)	$	(77,401	)	$	31,628		$	(81,981	)	$	127,754		$	(34,215	)

26

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	461,605		$	4,766		$	103,078		$	—		$	569,449
Sales	—			221,296			640,681			481,490			(623,792		)	719,675
Total revenue	—			682,901			645,447			584,568			(623,792		)	1,289,124
Rental expenses	13			186,426			12,180			167,226			(92,366		)	273,479
Cost of sales	84			221,212			396,855			177,420			(613,864		)	181,707
Gross profit (loss)	(97		)	275,263			236,412			239,922			82,438			833,938
Selling, general and administrative expenses	1,949			269,490			136,734			110,515			(210		)	518,478
Research and development expenses	—			23,366			23,263			9,511			—			56,140
Acquired intangible asset amortization	—			61,276			54,274			23,573			—			139,123
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(2,046		)	(78,869		)	(421,259		)	96,323			82,648			(323,203		)
Non-operating intercompany transactions	—			52,176			108,489			(112,565		)	(48,100		)	—
Interest income and other	—			54,046			9,188			166			(62,121		)	1,279
Interest expense	—			(324,163		)	(52,974		)	(128		)	62,121			(315,144		)
Loss on extinguishment of debt	—			(2,364		)	—			—			—			(2,364		)
Foreign currency gain (loss)	—			(8,953		)	(251		)	(2,731		)	—			(11,935		)
Derivative instruments gain	—			3,200			—			—			—			3,200
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(2,046		)	(304,927		)	(356,807		)	(18,935		)	34,548			(648,167		)
Income tax expense (benefit)	—			(97,201		)	(38,718		)	(8,624		)	—			(144,543		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(2,046		)	(207,726		)	(318,089		)	(10,311		)	34,548			(503,624		)
Equity in earnings (loss) of subsidiaries	(503,877		)	104,040			(10,136		)	—			409,973			—
Earnings (loss) from continuing operations	(505,923		)	(103,686		)	(328,225		)	(10,311		)	444,521			(503,624		)
Loss from discontinued operations, net of tax	—			(2,725		)	(3		)	175			254			(2,299		)
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Total comprehensive income (loss)	$	(512,932	)	$	(113,420	)	$	(335,237	)	$	(17,145	)	$	465,802		$	(512,932	)

27

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	495,299		$	4,507		$	122,544		$	—		$	622,350
Sales	—			218,950			312,106			388,453			(235,338		)	684,171
Total revenue	—			714,249			316,613			510,997			(235,338		)	1,306,521
Rental expenses	2			227,119			4,088			201,240			(84,062		)	348,387
Cost of sales	54			196,056			108,774			174,747			(289,177		)	190,454
Gross profit (loss)	(56		)	291,074			203,751			135,010			137,901			767,680
Selling, general and administrative expenses	1,142			244,705			96,903			103,765			(734		)	445,781
Research and development expenses	—			20,222			26,676			6,788			—			53,686
Acquired intangible asset amortization	—			81,085			59,273			31,902			—			172,260
Operating earnings (loss)	(1,198		)	(54,938		)	20,899			(7,445		)	138,635			95,953
Non-operating intercompany transactions	—			71,692			261,173			(352,936		)	20,071			—
Interest income and other	—			55,260			9,188			100			(63,918		)	630
Interest expense	—			(362,215		)	(54,725		)	(85		)	63,918			(353,107		)
Foreign currency gain (loss)	—			2,470			318			(2,360		)	—			428
Derivative instruments gain (loss)	—			(28,473		)	—			—			—			(28,473		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(1,198		)	(316,204		)	236,853			(362,726		)	158,706			(284,569		)
Income tax expense (benefit)	—			(61,959		)	(16,897		)	(28,269		)	—			(107,125		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(1,198		)	(254,245		)	253,750			(334,457		)	158,706			(177,444		)
Equity in earnings (loss) of subsidiaries	(179,926		)	(73,757		)	(338,090		)	—			591,773			—
Earnings (loss) from continuing operations	(181,124		)	(328,002		)	(84,340		)	(334,457		)	750,479			(177,444		)
Earnings (loss) from discontinued operations, net of tax	—			(8,761		)	4,100			(3,633		)	4,614			(3,680		)
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Total comprehensive income (loss)	$	(182,711	)	$	(338,350	)	$	(81,827	)	$	(339,677	)	$	759,854		$	(182,711	)

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Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities	3,619			249,757			397,283			35,915			(45,156		)	641,418
Net cash provided (used) by operating activities	(502,304		)	143,346			69,055			25,779			399,619			135,495
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(145,714		)	(14,556		)	(98,591		)	191,164			(67,697		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			(70		)	(4,474		)	271			—			(4,273		)
Net cash provided (used) by investing activities	—			(145,784		)	(19,030		)	(98,320		)	191,164			(71,970		)
Cash flows from financing activities:
Distribution to limited partners	(1,572		)	—			—			—			—			(1,572		)
Repayments of long-term debt and capital lease obligations	—			(60,446		)	—			17			—			(60,429		)
Payment of debt issuance costs	—			(21,604		)	—			—			—			(21,604		)
Proceeds (payments) on intercompany loans	—			51,298			(53,452		)	2,154			—			—
Proceeds (payments) on intercompany investments	503,876			(104,808		)	3,427			188,288			(590,783		)	—
Net cash provided (used) by financing activities	502,304			(135,560		)	(50,025		)	190,459			(590,783		)	(83,605		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(151		)	—			(151		)
Net increase (decrease) in cash and cash equivalents	—			(137,998		)	—			117,767			—			(20,231		)
Cash and cash equivalents, beginning of period	398			276,788			—			105,964			—			383,150
Cash and cash equivalents, end of period	$	398		$	138,790		$	—		$	223,731		$	—		$	362,919

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Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Adjustments to reconcile net loss to net cash provided (used) by operating activities	3,154			439,770			(123,522		)	153,344			(105,747		)	366,999
Net cash provided (used) by operating activities	(177,970		)	103,007			(203,762		)	(184,746		)	649,346			185,875
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(57,203		)	(42,323		)	(39,328		)	69,344			(69,510		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			87			(5,486		)	19			—			(5,380		)
Net cash provided (used) by investing activities	—			(57,116		)	(47,809		)	(39,309		)	69,344			(74,890		)
Cash flows from financing activities:
Capital contributions from limited partners	239			—			—			—			—			239
Distribution to limited partners	(1,970		)	—			—			—			—			(1,970		)
Repayments of long-term debt and capital lease obligations	—			(17,508		)	—			25			—			(17,483		)
Proceeds (payments) on intercompany loans	—			(120,557		)	45,537			75,020			—			—
Payment of debt issuance costs	—			(578		)	—			—			—			(578		)
Proceeds (payments) on intercompany investments	179,688			196,745			206,034			136,223			(718,690		)	—
Net cash provided (used) by financing activities	177,957			58,102			251,571			211,268			(718,690		)	(19,792		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			308			—			308
Net increase (decrease) in cash and cash equivalents	(13		)	103,993			—			(12,479		)	—			91,501
Cash and cash equivalents, beginning of period	411			142,652			—			72,363			—			215,426
Cash and cash equivalents, end of period	$	398		$	246,645		$	—		$	59,884		$	—		$	306,927

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the condensed consolidated financial statements and accompanying notes included in this report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed in our “Risk Factors.” (Part II, Item 1A.), including those previously disseminated in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 and each of the Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2013 and June 30, 2013.

GENERAL

We are a leading global medical technology company devoted to the discovery, development, manufacturing and marketing of innovative, high-technology therapies and products that have been designed to leverage the body’s innate ability to heal, thus improving clinical outcomes while helping to reduce the overall cost of patient care. We have an infrastructure designed to meet the specific needs of medical professionals and patients across all healthcare settings, including acute care hospitals, extended care organizations and patients’ homes, both in the United States and abroad. Our primary businesses serve the advanced wound care and regenerative medicine markets. We are owned by investment funds advised by Apax Partners and controlled affiliates of Canada Pension Plan Investment Board and the Public Sector Pension Investment Board and certain other co-investors.

KCI is focused on the development and commercialization of advanced wound care therapies based on our negative pressure technology platform which employs negative pressure in a variety of applications to promote wound healing through unique mechanisms of action and to speed recovery times while reducing the overall cost of treating patients with complex wounds. In addition, we continue to pursue development opportunities within the broader wound care market for technology outside of NPWT.

LifeCell is focused on the development and commercialization of regenerative and reconstructive acellular tissue matrices for use in reconstructive, orthopedic, and urogynecologic surgical procedures to repair soft tissue defects, as well as for reconstructive and cosmetic procedures.  Existing products include our human-based AlloDerm^® Regenerative Tissue Matrix (“AlloDerm”) and porcine-based Strattice™ Reconstructive Tissue Matrix (“Strattice”) in various configurations designed to meet the needs of patients and caregivers. In addition, LifeCell distributes SPY Elite, a real-time tissue perfusion assessment system. The majority of our LifeCell revenue is generated from the clinical applications of challenging hernia repair and post-mastectomy breast reconstruction.

Historically, we have experienced a seasonal slowing of KCI unit demand beginning in the fourth quarter and continuing into the first quarter which we believe has been caused by year-end clinical treatment patterns, such as the postponement of elective surgeries and increased discharges of individuals from the acute care setting around the winter holidays.  LifeCell has also historically experienced a similar seasonal slowing of sales in the first and third quarter of each year.  Although we do not know if our historical experience will prove to be indicative of future periods, similar slow-downs may occur in subsequent periods.

RECENT DEVELOPMENTS

Acquisition of Systagenix^TM 

On July 30, 2013, KCI announced that it had signed a definitive share purchase agreement to acquire Systagenix, an established provider of advanced wound care ("AWC") products. The transaction closed on October 28, 2013. At the closing of the transaction, KCI paid a purchase price of $485.0 million, subject to adjustment. The purchase price was funded by a combination of cash on hand and using $350.0 million of incremental term D-1 loans (the "Incremental Loans") incurred pursuant to Amendment No. 3 to our Senior Secured Credit Facility, dated as of October 28, 2013. The Incremental Loans were issued at a discount of $0.4 million. The interest rate and all other terms are identical to our previously-existing Dollar Term D-1 Loans.

Systagenix has a broad portfolio of innovative AWC products with a focus on moist wound healing dressings - including PROMOGRAN PRISMA®, the collagen dressing market leader, TIELLE® (foam) and ADAPTIC® (non adherent contact layers). Systagenix's manufacturing, marketing and sales teams supply and distribute over 20 million advanced wound care dressings each month to more than 70 countries. The company, formerly part of Johnson & Johnson, generates annual revenue of approximately $200.0 million and has approximately 800 employees worldwide, including an experienced team of research and development scientists dedicated to advancing skin and wound care. Combining Systagenix's expertise with KCI's innovation pipeline and scale will create additional value for customers and help speed healing and reduce complications for patients.

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RESULTS OF OPERATIONS

We have two reportable operating segments which correspond to our two global businesses: KCI and LifeCell. We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region. For additional discussion on segment and operation information, see Note 9 of the notes to the condensed consolidated financial statements.

Revenue for each of our geographic regions in which we operate is disclosed for each of our businesses. Certain prior period amounts have been reclassified to conform to the 2013 presentation.

Revenue by Operating Segment

The following table sets forth, for the periods indicated, business unit revenue as well as the percentage change in each line item, comparing the third quarter and first nine months of 2013 to the third quarter and first nine months of 2012 (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
KCI revenue:
Rental	$	189,528	$	205,415	(7.7	)%	$	564,683	$	617,843	(8.6	)%
Sales	131,351		124,236		5.7		379,843		368,314		3.1	%
Total – KCI	320,879		329,651		(2.7	)	944,526		986,157		(4.2	)%
LifeCell revenue:
Rental	1,513		1,741		(13.1	)	4,766		4,507		5.7	%
Sales	118,169		104,481		13.1		339,832		315,857		7.6	%
Total – LifeCell	119,682		106,222		12.7		344,598		320,364		7.6	%
Total consolidated revenue:
Rental	191,041		207,156		(7.8	)	569,449		622,350		(8.5	)%
Sales	249,520		228,717		9.1		719,675		684,171		5.2	%
Total consolidated revenue	$	440,561	$	435,873	1.1	%	$	1,289,124	$	1,306,521	(1.3	)%

The increase in total revenue for the third quarter of 2013 as compared to the prior-year period was due to higher LifeCell sales revenue, partially offset by lower KCI rental revenue. Foreign currency exchange rate movements did not have a significant impact on worldwide revenue compared to the prior year periods.

The decline in worldwide KCI revenue from the comparable prior-year periods was attributable primarily to lower rental revenue in established markets, partially offset by increased revenues from expansion products and certain markets outside the U.S. The lower rental revenue in established markets resulted from a combination of lower volumes and lower average pricing. We anticipate our average global pricing will decline moderately in the future as our competitors market products designed to compete with KCI's offering. Foreign currency exchange rate movements did not have a significant impact on worldwide KCI revenue compared to the prior year periods.

The growth in worldwide LifeCell revenue over the prior-year periods was due primarily to increased sales volumes of our products. Foreign currency exchange rate movements did not have a significant impact on worldwide LifeCell revenue.

32

Revenue by Geography

The following table sets forth, for the periods indicated, rental and sales revenue by geography as well as the percentage change in each line item, comparing the third quarter and first nine months of 2013 to the third quarter and first nine months of 2012 (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
Americas revenue:
Rental	$	161,992	$	171,934	(5.8	)%	$	480,606	$	516,161	(6.9	)%
Sales	198,458		182,656		8.7		571,985		543,136		5.3	%
Total – Americas	360,450		354,590		1.7		1,052,591		1,059,297		(0.6	)%
EMEA/APAC revenue:
Rental	29,049		35,222		(17.5	)	88,843		106,189		(16.3	)%
Sales	51,062		46,061		10.9		147,690		141,035		4.7	%
Total – EMEA/APAC	80,111		81,283		(1.4	)	236,533		247,224		(4.3	)%
Total consolidated revenue:
Rental	191,041		207,156		(7.8	)	569,449		622,350		(8.5	)%
Sales	249,520		228,717		9.1		719,675		684,171		5.2	%
Total consolidated revenue	$	440,561	$	435,873	1.1	%	$	1,289,124	$	1,306,521	(1.3	)%

Revenue Relationship

The following table sets forth, for the periods indicated, the percentage relationship of each item to total revenue in the period, as well as the changes in each line item:

	Three months ended September 30,							Nine months ended September 30,
	2013		2012		Change			2013		2012		Change
KCI revenue	72.8	%	75.6	%	(280	)	bps	73.3	%	75.5	%	(220	)	bps
LifeCell revenue	27.2		24.4		280		bps	26.7		24.5		220		bps
Total consolidated revenue	100.0	%	100.0	%				100.0	%	100.0	%
Americas revenue	81.8	%	81.4	%	40		bps	81.7	%	81.1	%	60		bps
EMEA/APAC revenue	18.2		18.6		(40	)	bps	18.3		18.9		(60	)	bps
Total consolidated revenue	100.0	%	100.0	%				100.0	%	100.0	%
Rental revenue	43.4	%	47.5	%	(410	)	bps	44.2	%	47.6	%	(340	)	bps
Sales revenue	56.6		52.5		410		bps	55.8		52.4		340		bps
Total consolidated revenue	100.0	%	100.0	%				100.0	%	100.0	%

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Rental Expenses

The following table presents rental expenses for the periods indicated as well as the percentage change in each line item, comparing the third quarter and first nine months of 2013 to the third quarter and first nine months of 2012 (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
Rental expenses	$	85,746	$	100,810	(14.9	)%	$	273,479	$	348,387	(21.5	)%

Rental, or field, expenses are comprised of both fixed and variable costs including facilities, field service, sales force compensation and royalties associated with our rental products. Rental expenses during the third quarter and first nine months of 2013 decreased from the prior-year periods due primarily to a decrease in depreciation related to the fixed asset step up associated with purchase accounting and a reduction in operational expenses due to cost control measures.

Cost of Sales

The following table presents cost of sales as well as the percentage change in each line item, comparing the third quarter and first nine months of 2013 to the third quarter and first nine months of 2012 (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
Cost of sales	$	66,151	$	58,613	12.9	%	$	181,707	$	190,454	(4.6	)%

Cost of sales includes manufacturing costs, product costs and royalties associated with our “for sale” products. The increase in cost of sales in the third quarter of 2013 compared to the prior-year period was due primarily to increased sales volumes, partially offset by $3.0 million of additional cost of sales recorded in the third quarter of 2012 associated with purchase accounting adjustments related to the step up in value of inventory. Cost of sales decreased for the first nine months of 2013 compared to the prior year period due primarily to $25.0 million of cost of sales recorded in the first nine months of 2012 associated with purchase accounting adjustments related to the step up in value of inventory, partially offset by increased sales volumes.

Gross Profit Margin

The following table presents the gross profit margin (calculated as gross profit divided by total revenue for the periods indicated):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
Gross profit margin	65.5	%	63.4	%	210	bps	64.7	%	58.8	%	590	bps

The gross profit margin increase during the third quarter and first nine months of 2013 compared to the prior-year periods was due primarily to a decrease in depreciation related to the fixed asset step up and lower cost of sales related to the inventory step up associated with purchase accounting and a reduction in operational expenses due to cost control measures.

Selling, General and Administrative Expenses

The following table presents selling, general and administrative expenses and the percentage relationship to total revenue (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013		2012		% Change		2013		2012		% Change
Selling, general and administrative expenses	$	152,053	$	142,778	6.5	%	$	518,478	$	445,781	16.3	%

34

Selling, general and administrative (“SG&A”) expenses generally include administrative labor, incentive and sales compensation costs, insurance costs, professional fees, depreciation, bad debt expense and information systems costs, but exclude rental sales force compensation costs. The increase in SG&A expenses during the first nine months of 2013 compared to the prior-year periods is due primarily to a fixed asset impairment charge of $30.3 million and an increase in restructuring-related expenses. Additionally, during the third quarter and first nine months of 2013, write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets were recorded due primarily to the discontinuation of certain projects. During the third quarter and first nine months of 2012, SG&A expenses included impairment charges of $9.7 million and $22.1 million, respectively, associated with certain production equipment at our KCI manufacturing plant and inventory associated with our V.A.C.Via product.

Research and Development Expenses

The following table presents research and development expenses and the percentage relationship to total revenue (dollars in thousands):

	Three months ended September 30,									Nine months ended September 30,
	2013			2012			% Change			2013			2012			% Change
Research and development expenses	$	17,961		$	17,376		3.4		%	$	56,140		$	53,686		4.6		%
As a percent of total revenue	4.1		%	4.0		%	10	bps		4.4		%	4.1		%	30	bps

Research and development expenses relate to our investments in clinical studies and the development of new and enhanced products and therapies. Our research and development efforts include the development of new and synergistic technologies across the continuum of wound care, including tissue regeneration, preservation and repair, as well as new applications of negative pressure technology. Our research and development program is also leveraging our core understanding of biological tissues in order to develop biosurgery products in our LifeCell business.

Acquired Intangible Asset Amortization

In connection with the 2011 merger, we recorded $2.89 billion of identifiable intangible assets during the fourth quarter of 2011. During the third quarters of 2013 and 2012, we recorded $45.1 million and $49.7 million, respectively, of amortization expense associated with these acquired intangible assets. During the first nine months of 2013 and 2012, we recorded $139.1 million and $172.3 million, respectively, of amortization expense associated with these acquired intangible assets.

Impairment of Goodwill and Intangible Assets

During the third quarter of 2013 we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

Interest Expense

Interest expense decreased to $101.4 million and $315.1 million in the third quarter and first nine months of 2013, respectively, compared to $117.9 million and $353.1 million in the comparable prior-year periods due to lower average debt balances at lower interest rates.

Foreign Currency Gain (Loss)

Foreign currency transaction losses were $8.7 million and $11.9 million during the third quarter and first nine months of 2013, compared to a loss of $5.3 million and a gain of $0.4 million, respectively, in the prior-year comparable periods. The revaluation of the Term D-1 EURO loan to U.S. dollars represented $12.5 million and $8.2 million of the foreign currency transaction losses recorded during the third quarter and first nine months of 2013, respectively. The revaluation of the Term D-1 EURO loan to U.S. dollars represented a foreign currency transaction loss of $6.5 million recorded during the third quarter of 2012 and a $2.7 million foreign currency transaction gain recorded during the first nine months of 2012.

35

Derivative Instruments Gain (Loss)

During the third quarter and first nine months of 2013, we recorded a derivative instruments loss of $6.8 million and a gain of $3.2 million, respectively, compared to losses of $8.6 million and $28.5 million in the comparable prior-year periods due primarily to fluctuations in the value of our interest rate derivative instruments.

Gain (Loss) from Discontinued Operations

During the third quarter and first nine months of 2013, we recorded losses from discontinued operations, net of tax, of $0.3 million and $2.3 million, respectively, compared to a gain of $2.0 million and a loss of $3.7 million during the corresponding periods of the prior year.

LIQUIDITY AND CAPITAL RESOURCES

General

We require capital principally for working capital requirements, capital expenditures and debt service. Additionally, from time to time, we may use capital for acquisitions and other investing and financing activities. Working capital is required principally to finance accounts receivable and inventory. Our working capital requirements vary from period-to-period depending on manufacturing volumes, the timing of shipments and the payment cycles of our customers and payers.

We may from time to time seek to retire or purchase our outstanding debt through cash purchases, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Sources of Capital

Based upon the current level of operations, we believe our existing capital resources, as well as cash flows from operating activities and availability under our Revolving Credit Facility will be adequate to meet our anticipated cash requirements for at least the next twelve months. Cash flows related to discontinued operations were not material for the first nine months of 2013 and 2012 and therefore have not been separately disclosed in the condensed consolidated statements of cash flows. We do not anticipate the absence of cash flows from discontinued operations to significantly affect our liquidity and capital resources. During the first nine months of 2013 and 2012, our primary source of capital was cash from operations. The following table summarizes the net cash provided and used by operating activities, investing activities and financing activities (in thousands):

	Nine months ended September 30,
	2013			2012
Net cash provided by operating activities	$	135,495		$	185,875
Net cash used by investing activities	(71,970		)	(74,890		)
Net cash used by financing activities	(83,605		)	(19,792		)
Effect of exchange rates changes on cash and cash equivalents	(151		)	308
Net increase (decrease) in cash and cash equivalents	$	(20,231	)	$	91,501

As of September 30, 2013 and December 31, 2012, our principal sources of liquidity consisted of $362.9 million and $383.2 million, respectively, of cash and cash equivalents. We also had availability of $189.3 million and $188.5 million under our Revolving Credit Facility as of September 30, 2013 and December 31, 2012, respectively.

Capital Expenditures

During the first nine months of 2013 and 2012, we made capital expenditures of $59.9 million and $72.0 million, respectively. Capital expenditures during the first nine months of 2013 related primarily to expanding the rental fleet and information technology projects and purchases. Capital expenditures during the first nine months of the prior year related primarily to expanding the rental fleet, the construction of our global headquarters building, and information technology projects and purchases.

36

Senior Secured Credit Facility

The following table sets forth the amounts owed under the Senior Secured Credit Facility, the effective interest rates on such outstanding amounts, and the amount available for additional borrowing thereunder, as of September 30, 2013 (dollars in thousands):

Senior Secured Credit Facility	Maturity Date	Effective Interest Rate			Amount Outstanding (1)		Amount Available for Additional Borrowing
Senior Revolving Credit Facility	November 2016	—	%		$	—	$	189,334	(2)
Senior Dollar Term D-1 Credit Facility	May 2018	5.00	%	(3)	1,569,507		—
Senior Euro Term D-1 Credit Facility	May 2018	5.59	%	(3)	321,153		—
Senior Term D-2 Credit Facility	November 2016	4.54	%	(3)	314,479		—
Total					$	2,205,139	$	189,334

_____________________

(1) Amount outstanding includes the original issue discount.

(2) At September 30, 2013, the amount available under the Revolving Credit Facility reflected a reduction of $10.7 million of letters of credit issued by banks which are party to the Senior Secured Credit Facility. In addition, we have $3.5 million of letters of credit issued by a bank not party to the Senior Secured Credit Facility.

(3) The effective interest rate includes the effect of the original issue discount. Excluding the original issue discount, our nominal interest rate as of September 30, 2013 was 4.50% on the Senior Dollar Term D-1 Credit Facility, 4.75% on the Senior Euro Term D-1 Credit Facility and 4.00% on the Senior Term D-2 Credit Facility.

Senior Secured Credit Facility

On June 14, 2013, we entered into Amendment No. 2 to our senior credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. In connection with the amendment, Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans were refinanced with Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, respectively. Amounts outstanding under the Dollar Term D-1 Loans, the Term D-2 Loans and the Revolving Credit Facility (other than swing-line loans and unreimbursed drawings on letters of credit) bear interest, at our option, at a rate equal to either the base rate or the eurocurrency rate, in each case plus an applicable margin. Amounts outstanding under the Euro Term D-1 Loans bear interest at the eurocurrency rate, and swing-line loans and unreimbursed drawings on letters of credit bear interest at the base rate. As a result of Amendment No. 2, the new applicable margins are (i) for eurocurrency rate loans that are Dollar Term D-1 Loans, 3.50%, (ii) for base rate loans that are Dollar Term D-1 Loans, 2.50%, (iii) for eurocurrency rate loans that are Euro Term D-1 Loans, 3.75%, (iv) for base rate loans that are Euro Term D-1 Loans, 2.75%, (v) for eurocurrency rate loans that are Term D-2 Loans, 3.00%, and (vi) for base rate loans that are Term D-2 Loans, 2.00%. The Term D loans will have a eurocurrency rate floor of 1.00% and a base rate floor of 2.00%.

In connection with our acquisition of Systagenix, we borrowed $350.0 million of incremental term D-1 loans (the "Incremental Loans") incurred pursuant to Amendment No. 3 to our Senior Secured Credit Facility, dated as of October 28, 2013. The Incremental Loans were issued at a discount of $0.4 million. The interest rate and all other terms are identical to our previously-existing Dollar Term D-1 Loans.

10.5% Second Lien Senior Secured Notes

In November 2011, we issued $1.75 billion aggregate principal amount of 10.5% Second Lien Notes due 2018. Interest on the 10.5% Second Lien Notes accrues at the rate of 10.50% per annum and is payable semi-annually in cash on each May 1 and November 1, beginning on May 1, 2012, to the persons who are registered holders at the close of business on April 15 and October 15 immediately preceding the applicable interest payment date. The 10.5% Second Lien Notes were issued at a discount resulting in an effective interest rate of 10.87%. Under the terms of the registration rights agreements entered into with respect to these notes, additional interest was accrued at a rate of 0.25% and 0.50% from November 4, 2012 to February 4, 2013 and February 5, 2013 to March 15, 2013, respectively, due to delays in the effectiveness of our registration statement.

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12.5% Senior Unsecured Notes

In November 2011, we issued $750.0 million aggregate principal amount of senior 12.5% Unsecured Notes due 2019; $612.0 million of which are still outstanding. Interest on the 12.5% Unsecured Notes accrues at the rate of 12.50% per annum and is payable semi-annually in cash on each May 1 and November 1, beginning on May 1, 2012, to the persons who are registered holders at the close of business on April 15 and October 15 immediately preceding the applicable interest payment date. The12.5% Unsecured Notes were issued at a discount resulting in an effective interest rate of 12.62%. Under the terms of the registration rights agreements entered into with respect to these notes, additional interest was accrued at a rate of 0.25% and 0.50% from November 4, 2012 to February 4, 2013 and February 5, 2013 to March 15, 2013, respectively, due to delays in the effectiveness of our registration statement.

Convertible Senior Notes

In 2008, we issued $690.0 million aggregate principal amount of 3.25% convertible senior notes due 2015.  The Convertible Notes are governed by the terms of an indenture dated as of April 21, 2008 (the “Convertible Notes Indenture”). As a result of the Merger, the holders of the Convertible Notes have the right to require us to repurchase some or all of their Convertible Notes as provided in the Convertible Notes Indenture. The repurchase price is the principal amount of the Convertible Notes plus accrued interest. As of September 30, 2013, $101,000 aggregate principal amount of the notes remained outstanding.

Covenants

As of September 30, 2013, we were in compliance with all covenants under our Senior Secured Credit Facility, 10.5% Second Lien Notes, 12.5% Unsecured Notes, and the Convertible Notes.

For further information on our long-term debt, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

Interest Rate Protection

At September 30, 2013 and December 31, 2012, we had three interest rate swap agreements to convert $1.5 billion of our outstanding variable rate debt to a fixed rate basis. These agreements become effective on December 31, 2013. Once effective, the aggregate notional amount decreases quarterly by amounts ranging from $1.7 million to $56.4 million until maturity. As of September 30, 2013 and December 31, 2012, we had interest rate cap agreements with remaining notional amounts of $1.6 billion that effectively limits the eurocurrency rate to 2% on a portion of the borrowings under our Senior Secured Credit Facility. Our interest rate protection agreements have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period.

For further information on our interest rate protection agreements, see Note 6 of the notes to the condensed consolidated financial statements.

Contractual Obligations

There have been no material changes, outside of the ordinary course of business, in our outstanding contractual obligations since December 31, 2012.

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OTHER MATTERS

We are party to lawsuits arising in the ordinary course of our business. Additionally, the manufacturing and marketing of medical products necessarily entails an inherent risk of product liability claims. We maintain multiple layers of product liability insurance coverage and we believe these policies and the amounts of coverage are appropriate and adequate. For additional discussion of our legal proceedings, see Note 8 of the notes to the condensed consolidated financial statements.

The U.S. and global economies continue to show signs of weakness. We believe the economic downturn may generally decrease hospital census and the demand for elective surgeries. Also, the global financial crisis, continuing high levels of unemployment and general economic uncertainties have made it more difficult and more expensive for hospitals and health systems to obtain credit which may contribute to pressures on their operating margins. We believe that rising unemployment reduces the number of individuals covered by private insurance which has resulted in a noticeable increase in our charity-care placements and may increase the cost of uncompensated care for hospitals. Higher unemployment may also result in a shift in reimbursement patterns as unemployed individuals switch from private plans to public plans such as Medicaid or Medicare. If the economic downturn persists and unemployment remains high or increases, any significant shift in coverage for the unemployed may have an unfavorable impact on our reimbursement mix and may result in a decrease in our overall average unit prices.

For the year ended December 31, 2012, U.S. Medicare placements of our NPWT products represented approximately 9.6% of our total revenue. In the future, KCI's revenue from U.S. Medicare placements of NPWT products is expected to be subject to Medicare’s durable medical equipment competitive bidding program. On January 30, 2013, Centers for Medicare and Medicaid Services (“CMS”) announced new reimbursement rates for Medicare patients in the home, which become effective July 1, 2013. This program resulted in an average reimbursement decline of 41% for NPWT across 91 major metropolitan areas, which represent approximately 40% of our U.S. Medicare Part B business. CMS's DME Competitive Bidding Round One Re-Compete program will impact an additional 9 areas, beginning January 1, 2014, with a similar reimbursement decline of 42%. Additionally, in March 2013, CMS announced that sequestration cuts of 2% will apply to all Medicare Part A and B fee-for-service payments, including items under Medicare competitive bidding contracts, beginning April 1, 2013. CMS applies the 2% reduction to all claims after determining coinsurance and any applicable deductible and Medicare secondary payment adjustments. The sequestration cut is in place for 10 years (until 2021) unless Congress acts.

Critical Accounting Estimates

For a description of our critical accounting estimates, please see our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 under the heading Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates."

Recently Issued Accounting Standards

In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

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ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to various market risks, including fluctuations in interest rates and variability in currency exchange rates. There have been no material changes from the risk factors disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012. For a description of our policies, procedures and internal processes governing our management of market risk and the use of financial instruments to manage our exposure to such risk, please see our Annual Report for the fiscal year ended December 31, 2012 under the heading “Quantitative and Qualitative Disclosures About Market Risk.”

ITEM 4.CONTROLS AND PROCEDURES

Disclosure Controls and Procedures. Our management, with the participation of the Chief Executive Officer of KCI and LifeCell and our principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, our Chief Executive Officer and principal financial officer have concluded that, as of the end of such period, our disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by us in the reports that we file or submit under the Exchange Act and are effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting. There have not been any changes in our internal control over financial reporting (as such term is defined by paragraph (d) of Rule 13a-15) under the Exchange Act, during the third fiscal quarter of 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

Incorporate in this Item 1, by reference, are the legal proceedings described in note 8 of the notes to condensed consolidated financial statements included in this report under the heading "Commitments and Contingencies: Legal Proceedings."

ITEM 1A.RISK FACTORS

Except with respect to the following new risk factors described below, there have been no material changes from the risk factors disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

We may not recognize the benefits of the Systagenix Acquisition.

We may not realize the expected benefits of the Systagenix Acquisition because of integration difficulties and other challenges. The success of the Systagenix Acquisition will depend, in part, on our ability to realize all or some of the anticipated synergies and other benefits from integrating Systagenix's business with our existing businesses. The integration process may be complex, costly and time-consuming. The difficulties of integrating the operations of Systagenix's business include, among others:

•failure to implement our business plan for the combined business;

• unanticipated issues in integrating manufacturing, logistics, information, communications and other systems;

• possible inconsistencies in standards, controls, procedures and policies, and compensation structures between Systagenix's structure and our structure;

•failure to retain key customers and suppliers;

•unanticipated changes in applicable laws and regulations;

•failure to retain key employees;

•operating risks inherent in Systagenix's business and our business; and

•unanticipated issues, expenses and liabilities.

We may not be able to maintain the levels of revenue, earnings or operating efficiency that each of KCI and Systagenix had achieved or might achieve separately. In addition, we may not accomplish the integration of Systagenix's business smoothly, successfully or within the anticipated costs or time frame. Moreover, the markets in which Systagenix operates may not experience the growth rates expected and any further economic downturn affecting Europe could negatively impact Systagenix's business. If we experience difficulties with the integration process or if the Systagenix business or the markets in which it operates deteriorate, the anticipated cost savings, growth opportunities and other synergies of the Systagenix Acquisition may not be realized fully, or at all, or may take longer to realize than expected. In such case, our business, financial condition and results of operations may be negatively impacted.

We face risks associated with the Share Purchase Agreement in connection with the Systagenix Acquisition.

In connection with the Systagenix Acquisition, we will be subject to substantially all the liabilities of Systagenix that are not satisfied on or prior to the closing date. There may be liabilities that we underestimated or did not discover in the course of performing our due diligence investigation of Systagenix. Under the Share Purchase Agreement, the Seller has agreed to provide us with a limited set of representations and warranties. Our sole remedy from the Seller for any breach of those representations and warranties is an action for indemnification. A portion of the purchase price will be held in escrow following the closing date to satisfy indemnification claims that we may have under the Share Purchase Agreement.

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ITEM 6.EXHIBITS

A list of all exhibits filed or included as part of this quarterly report on Form 10-Q is as follows:
Exhibit Number	Description
3.1	Declaration of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.3 to our Registration Statement on Form S-4 filed on October 1, 2012).
3.2	Certificate of Registration of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.4 to our Registration Statement on Form S-4 filed on October 1, 2012).
3.3	Amended and Restated Limited Partnership Agreement of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.3 to our Registration Statement on Form S-4 filed on October 1, 2012).
†31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
†31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
†32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
	†      Exhibit filed herewith.

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SIGNATURES

Pursuant to the requirements 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 November 13, 2013.

	CENTAUR GUERNSEY L.P. INC.
	(REGISTRANT)
Date: November 13, 2013	By:	/s/ Joseph F. Woody
		Joseph F. Woody
		Principal Executive Officer
		(Duly Authorized Officer)
Date: November 13, 2013	By:	/s/ Robert P. Hureau
		Robert P. Hureau
		Principal Financial Officer
		(Duly Authorized Officer)

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EXHIBITS

Exhibit Number	Description
3.1	Declaration of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.3 to our Registration Statement on Form S-4 filed on October 1, 2012).
3.2	Certificate of Registration of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.4 to our Registration Statement on Form S-4 filed on October 1, 2012).
3.3	Amended and Restated Limited Partnership Agreement of Centaur Guernsey L.P. Inc. (filed as Exhibit 3.3 to our Registration Statement on Form S-4 filed on October 1, 2012).
†31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
†31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
†32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated November 13, 2013.
	†      Exhibit filed herewith.

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EX-31.1

Exhibit 31.1

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER

(PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)

I, Joseph F. Woody, certify that:

1.   I have reviewed this Quarterly Report on Form 10-Q of Centaur Guernsey L.P. Inc.

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

   (a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

   (b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

   (c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

   (d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

   (a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

   (b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:       November 13, 2013

 /s/ Joseph F. Woody

Joseph F. Woody

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF THE CHIEF FINANCIAL OFFICER

(PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002)

I, Robert P. Hureau, certify that:

1.   I have reviewed this Quarterly Report on Form 10-Q of Centaur Guernsey L.P. Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

   (a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

   (b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

   (c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

   (d)   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

   (a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

   (b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:   November 13, 2013

 /s/ Robert P. Hureau

Robert P. Hureau

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES‑OXLEY ACT OF 2002

     In connection with the Quarterly Report of Centaur Guernsey L.P. Inc. (the "Company") on Form 10-Q for the quarter ended September 30, 2013 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Joseph F. Woody, as Chief Executive Officer of the Company and Robert P. Hureau, as Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes‑Oxley Act of 2002, to the best of their knowledge, respectively, that (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 13, 2013

 /s/ Joseph F. Woody

Joseph F. Woody

Chief Executive Officer

 /s/ Robert P. Hureau

Robert P. Hureau

Chief Financial Officer

XML

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP” or “the Codification”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information necessary for a fair presentation of results of operations, financial position and cash flows in conformity with GAAP. Operating results from interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of our results for the interim periods presented. Certain prior period amounts have been reclassified to conform to the 2013 presentation.

On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's Therapeutic Support Systems ("TSS") business (the “Agreement”). The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. In accordance with the Codification, depreciation and amortization of the long-lived assets subject to the Agreement ceased as of August 15, 2012. Additionally, the results of the operations subject to the Agreement, excluding the allocation of general corporate overhead, are presented as discontinued operations in the condensed consolidated statements of operations for all periods presented. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

The Company has two reportable operating segments which correspond to our two global businesses: KCI and LifeCell Corporation ("LifeCell"). We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region.

The condensed consolidated financial statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

Derivative Financial Instruments and Fair Value Measurements

Derivative Financial Instruments and Fair Value Measurements

We use derivative financial instruments to manage the economic impact of fluctuations in interest rates. We do not use financial instruments for speculative or trading purposes. Periodically, we enter into interest rate protection agreements to modify the interest characteristics of our outstanding debt. Our interest rate derivatives have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period.

We also use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates on our intercompany balances and corresponding cash flows and to manage our transactional currency exposures when our foreign subsidiaries enter into transactions denominated in currencies other than their local currency. We enter into foreign currency exchange contracts to manage these economic risks. These contracts are not designated as hedges; as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. Although we use master netting agreements with our derivative counterparties, we do not offset derivative asset and liability positions in the condensed consolidated balance sheets.

All derivative instruments are recorded on the balance sheets at fair value. The fair values of our interest rate derivatives and foreign currency exchange contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly-quoted markets, which represent level 2 inputs as defined by the Codification.

Concentration of Credit Risk

Concentration of Credit Risk

We have a concentration of credit risk with financial institutions related to our derivative instruments. As of September 30, 2013, Morgan Stanley, UBS and HSBC were the counterparties on our interest rate protection agreements consisting of interest rate swap and cap agreements in notional amounts totaling $1.031 billion each. We use master netting agreements with our derivative counterparties to reduce our risk and use multiple counterparties to reduce our concentration of credit risk.

We maintain cash and cash equivalents with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits bear minimal credit risk as they are maintained at financial institutions of reputable credit and generally may be redeemed upon demand.

Recently Adopted Accounting Standards

Recently Adopted Accounting Standards

In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

Property, Plant and Equipment, Impairment [Policy Text Block]

 Long-Lived Assets

When an event occurs that indicates the carrying value of long-lived assets might not be recoverable, we review property, plant and equipment for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly.

Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block]

Goodwill and Other Intangible Assets

Goodwill represents the excess purchase price over the fair value of net assets acquired. Goodwill is tested for impairment by reporting unit annually, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Impairment of goodwill is tested by comparing the carrying value of the reporting unit to the reporting unit’s fair value. The carrying value of each reporting unit is determined by taking the reported net assets of the consolidated entity, identifying reporting unit specific assets (including goodwill) and liabilities and allocating shared operational and administrative assets and liabilities to the appropriate reporting unit, which is the same as the segment to which they are assigned. The fair value of each reporting unit is determined using discounted cash flow models using certain performance assumptions and appropriate discount rates determined by our management. To ensure the reasonableness of the estimated fair value of our reporting units, we also consider current industry market multiples. When it is determined that the carrying value of goodwill may not be recoverable based upon the existence of one or more of the above indicators of impairment, the measurement of any impairment is determined and the carrying value is reduced as appropriate.

Identifiable intangible assets include developed technology, in process research and development, customer relationships, tradenames and patents. For intangible assets that are subject to amortization, we amortize the assets over the estimated economic or contractual life of the individual asset. When an event occurs that indicates the carrying value of definite-lived intangible assets might not be recoverable, we review the assets for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. Indefinite-lived intangibles are tested for impairment annually, or more frequently when events or changes in circumstances indicate that the assets might be impaired. If the carrying amount of the indefinite-lived intangible assets exceeds their fair value, an impairment is recognized in an amount equal to that excess.

Other Significant Accounting Policies

Other Significant Accounting Policies

For further information on our significant accounting policies, see Note 1 of the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

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Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Net loss	$ (398,561)	$ (35,812)	$ (505,923)	$ (181,124)
Unrealized investment gain, net of tax expense of $338 and $1,413 in 2013	541	0	2,257	0
Foreign currency translation adjustment, net of tax benefit (expense) of $(300) and $259 in 2013 and $(164) and $(438) in 2012	(5,131)	1,597	(9,266)	(1,587)
Total comprehensive income (loss)	$ (403,151)	$ (34,215)	$ (512,932)	$ (182,711)

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Supplemental Balance Sheet Data

9 Months Ended

Sep. 30, 2013

Balance Sheet Related Disclosures [Abstract]

Supplemental Balance Sheet Data

Supplemental Balance Sheet Data

(a)Accounts Receivable, net

Accounts receivable consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Gross trade accounts receivable:
Billed trade accounts receivable	$	382,538		$	370,708
Unbilled receivables	49,350			45,466
Less:  Allowance for revenue adjustments	(69,546		)	(71,770		)
Gross trade accounts receivable	362,342			344,404
Less:  Allowance for bad debt	(7,017		)	(4,768		)
Net trade accounts receivable	355,325			339,636
Other receivables	13,575			16,082
	$	368,900		$	355,718

(b)   Inventories, net

Inventories consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Finished goods and tissue available for distribution	$	100,873		$	96,573
Goods and tissue in-process	9,325			12,421
Raw materials, supplies, parts and unprocessed tissue	66,033			45,993
	176,231			154,987
Less: Amounts expected to be converted into equipment for short-term rental	(14,118		)	(5,237		)
Reserve for excess and obsolete inventory	(12,127		)	(9,900		)
	$	149,986		$	139,850

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Guarantor Condensed Consolidating Financial Statements (Tables)

9 Months Ended

Sep. 30, 2013

Guarantor Condensed Consolidating Financial Statements [Abstract]

Guarantor and Non-Guarantor Balance Sheet

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

September 30, 2013

(in thousands)

(unaudited)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	138,790		$	—	$	223,731		$	—		$	362,919
Accounts receivable, net	—		184,370			73,382		111,148			—			368,900
Inventories, net	—		63,219			92,060		78,178			(83,471		)	149,986
Prepaid expenses and other	—		41,376			5,913		342,209			(329,999		)	59,499
Intercompany receivables	166		1,400,317			2,270,890		149,321			(3,820,694		)	—
Total current assets	564		1,828,072			2,442,245		904,587			(4,234,164		)	941,304
Net property, plant and equipment	—		297,648			82,391		197,071			(264,555		)	312,555
Debt issuance costs, net	—		101,766			—		—			—			101,766
Deferred income taxes	—		—			—		21,866			—			21,866
Goodwill	—		2,483,240			724,335		—			—			3,207,575
Identifiable intangible assets, net	—		380,314			1,809,207		154,004			—			2,343,525
Other non-current assets	—		424			186		94,344			(90,900		)	4,054
Intercompany loan receivables	—		785,000			404,586		—			(1,189,586		)	—
Intercompany investments	948,376		406,067			406,253		—			(1,760,696		)	—
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	16,089		$	12,540	$	15,898		$	—		$	44,527
Accrued expenses and other	—		234,359			238,528		61,948			(182,932		)	351,903
Intercompany payables	3,934		788,613			2,508,621		519,526			(3,820,694		)	—
Current installments of long-term debt	—		22,760			1,341		—			—			24,101
Income taxes payable	—		1,495			—		(1,495		)	—			—
Deferred income taxes	—		(34,267		)	42,519		(3,642		)	—			4,610
Total current liabilities	3,934		1,029,049			2,803,549		592,235			(4,003,626		)	425,141
Long-term debt, net of current installments and discount	—		4,516,223			916		—			—			4,517,139
Non-current tax liabilities	—		42,084			—		4,377			—			46,461
Deferred income taxes	—		56,892			852,886		50,441			—			960,219
Other non-current liabilities	218		37,242			298		1,139			—			38,897
Intercompany loan payables	—		402,433			785,000		2,153			(1,189,586		)	—
Total liabilities	4,152		6,083,923			4,442,649		650,345			(5,193,212		)	5,987,857
Total equity	944,788		198,608			1,426,554		721,527			(2,346,689		)	944,788
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

December 31, 2012

(in thousands)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	276,788		$	—	$	105,964	$	—		$	383,150
Accounts receivable, net	—		174,534			58,244		122,940		—			355,718
Inventories, net	—		94,345			71,676		60,635		(86,806		)	139,850
Deferred income taxes	—		38,451			—		3,642		(42,093		)	—
Prepaid expenses and other	—		25,083			6,591		294,437		(286,600		)	39,511
Intercompany receivables	166		1,337,915			2,149,981		147,473		(3,635,535		)	—
Total current assets	564		1,947,116			2,286,492		735,091		(4,051,034		)	918,229
Net property, plant and equipment	—		281,950			79,049		190,419		(162,936		)	388,482
Debt issuance costs, net	—		96,476			—		—		—			96,476
Deferred income taxes	—		—			—		20,003		—			20,003
Goodwill	—		2,483,240			996,535		—		—			3,479,775
Identifiable intangible assets, net	—		441,620			2,045,091		179,490		—			2,666,201
Other non-current assets	—		324			186		95,988		(90,900		)	5,598
Intercompany loan receivables	—		800,000			366,134		—		(1,166,134		)	—
Intercompany investments	1,459,261		302,027			409,702		—		(2,170,990		)	—
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	17,869		$	13,093	$	10,008	$	—		$	40,970
Accrued expenses and other	—		172,356			236,838		62,226		(187,257		)	284,163
Intercompany payables	2,361		723,096			2,389,863		520,215		(3,635,535		)	—
Current installments of long-term debt	—		23,383			—		—		—			23,383
Income taxes payable	—		(1,452		)	—		1,452		—			—
Deferred income taxes	—		—			99,621		—		(42,093		)	57,528
Total current liabilities	2,361		935,252			2,739,415		593,901		(3,864,885		)	406,044
Long-term debt, net of current installments and discount	—		4,554,112			—		—		—			4,554,112
Non-current tax liabilities	—		36,711			—		7,754		—			44,465
Deferred income taxes	—		115,652			888,597		65,231		—			1,069,480
Other non-current liabilities	68		41,360			375		1,464		—			43,267
Intercompany loan payables	—		366,135			800,000		—		(1,166,135		)	—
Total liabilities	2,429		6,049,222			4,428,387		668,350		(5,031,020		)	6,117,368
Total equity	1,457,396		303,531			1,754,802		552,641		(2,610,974		)	1,457,396
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	155,893		$	1,513		$	33,635		$	—		$	191,041
Sales	—			77,659			224,426			159,142			(211,707		)	249,520
Total revenue	—			233,552			225,939			192,777			(211,707		)	440,561
Rental expenses	—			62,928			4,010			53,891			(35,083		)	85,746
Cost of sales	30			123,481			142,946			57,512			(257,818		)	66,151
Gross profit (loss)	(30		)	47,143			78,983			81,374			81,194			288,664
Selling, general and administrative expenses	820			66,834			44,169			40,261			(31		)	152,053
Research and development expenses	—			8,010			6,742			3,209			—			17,961
Acquired intangible asset amortization	—			19,625			17,907			7,584			—			45,116
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(850		)	(47,326		)	(433,235		)	30,320			81,225			(369,866		)
Non-operating intercompany transactions	—			(8,076		)	49,735			(60,212		)	18,553			—
Interest income and other	—			17,852			3,062			97			(20,794		)	217
Interest expense	—			(104,402		)	(17,756		)	(34		)	20,794			(101,398		)
Loss on extinguishment of debt	—			(200		)	—			—			—			(200		)
Foreign currency gain (loss)	—			(14,433		)	(38		)	5,733			—			(8,738		)
Derivative instruments loss	—			(6,840		)	—			—			—			(6,840		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(850		)	(163,425		)	(398,232		)	(24,096		)	99,778			(486,825		)
Income tax expense (benefit)	—			(51,104		)	(34,535		)	(2,880		)	—			(88,519		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(850		)	(112,321		)	(363,697		)	(21,216		)	99,778			(398,306		)
Equity in earnings (loss) of subsidiaries	(397,711		)	48,780			(20,950		)	—			369,881			—
Earnings (loss) from continuing operations	(398,561		)	(63,541		)	(384,647		)	(21,216		)	469,659			(398,306		)
Earnings (loss) from discontinued operations, net of tax	—			(331		)	(1		)	266			(189		)	(255		)
Net earnings (loss)	$	(398,561	)	$	(63,872	)	$	(384,648	)	$	(20,950	)	$	469,470		$	(398,561	)
Total comprehensive income (loss)	$	(403,151	)	$	(68,462	)	$	(389,238	)	$	(25,540	)	$	483,240		$	(403,151	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	164,641		$	1,741		$	40,774		$	—		$	207,156
Sales	—			74,943			103,716			151,225			(101,167		)	228,717
Total revenue	—			239,584			105,457			191,999			(101,167		)	435,873
Rental expenses	—			62,877			1,526			61,744			(25,337		)	100,810
Cost of sales	18			89,027			34,023			58,201			(122,656		)	58,613
Gross profit (loss)	(18		)	87,680			69,908			72,054			46,826			276,450
Selling, general and administrative expenses	191			75,731			32,926			33,978			(48		)	142,778
Research and development expenses	—			6,268			8,977			2,131			—			17,376
Acquired intangible asset amortization	—			22,308			18,687			8,738			—			49,733
Operating earnings (loss)	(209		)	(16,627		)	9,318			27,207			46,874			66,563
Non-operating intercompany transactions	—			5,318			132,861			(131,367		)	(6,812		)	—
Interest income and other	—			18,532			3,063			18			(21,439		)	174
Interest expense	—			(120,964		)	(18,375		)	(20		)	21,439			(117,920		)
Foreign currency gain (loss)	—			(6,651		)	170			1,223			—			(5,258		)
Derivative instruments loss	—			(8,579		)	—			—			—			(8,579		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(209		)	(128,971		)	127,037			(102,939		)	40,062			(65,020		)
Income tax expense (benefit)	—			(22,700		)	14,055			(18,531		)	—			(27,176		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(209		)	(106,271		)	112,982			(84,408		)	40,062			(37,844		)
Equity in earnings (loss) of subsidiaries	(35,603		)	28,741			(83,578		)	—			90,440			—
Earnings (loss) from continuing operations	(35,812		)	(77,530		)	29,404			(84,408		)	130,502			(37,844		)
Earnings (loss) from discontinued operations, net of tax	—			(1,468		)	627			830			2,043			2,032
Net earnings (loss)	$	(35,812	)	$	(78,998	)	$	30,031		$	(83,578	)	$	132,545		$	(35,812	)
Total comprehensive income (loss)	$	(34,215	)	$	(77,401	)	$	31,628		$	(81,981	)	$	127,754		$	(34,215	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	461,605		$	4,766		$	103,078		$	—		$	569,449
Sales	—			221,296			640,681			481,490			(623,792		)	719,675
Total revenue	—			682,901			645,447			584,568			(623,792		)	1,289,124
Rental expenses	13			186,426			12,180			167,226			(92,366		)	273,479
Cost of sales	84			221,212			396,855			177,420			(613,864		)	181,707
Gross profit (loss)	(97		)	275,263			236,412			239,922			82,438			833,938
Selling, general and administrative expenses	1,949			269,490			136,734			110,515			(210		)	518,478
Research and development expenses	—			23,366			23,263			9,511			—			56,140
Acquired intangible asset amortization	—			61,276			54,274			23,573			—			139,123
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(2,046		)	(78,869		)	(421,259		)	96,323			82,648			(323,203		)
Non-operating intercompany transactions	—			52,176			108,489			(112,565		)	(48,100		)	—
Interest income and other	—			54,046			9,188			166			(62,121		)	1,279
Interest expense	—			(324,163		)	(52,974		)	(128		)	62,121			(315,144		)
Loss on extinguishment of debt	—			(2,364		)	—			—			—			(2,364		)
Foreign currency gain (loss)	—			(8,953		)	(251		)	(2,731		)	—			(11,935		)
Derivative instruments gain	—			3,200			—			—			—			3,200
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(2,046		)	(304,927		)	(356,807		)	(18,935		)	34,548			(648,167		)
Income tax expense (benefit)	—			(97,201		)	(38,718		)	(8,624		)	—			(144,543		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(2,046		)	(207,726		)	(318,089		)	(10,311		)	34,548			(503,624		)
Equity in earnings (loss) of subsidiaries	(503,877		)	104,040			(10,136		)	—			409,973			—
Earnings (loss) from continuing operations	(505,923		)	(103,686		)	(328,225		)	(10,311		)	444,521			(503,624		)
Loss from discontinued operations, net of tax	—			(2,725		)	(3		)	175			254			(2,299		)
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Total comprehensive income (loss)	$	(512,932	)	$	(113,420	)	$	(335,237	)	$	(17,145	)	$	465,802		$	(512,932	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	495,299		$	4,507		$	122,544		$	—		$	622,350
Sales	—			218,950			312,106			388,453			(235,338		)	684,171
Total revenue	—			714,249			316,613			510,997			(235,338		)	1,306,521
Rental expenses	2			227,119			4,088			201,240			(84,062		)	348,387
Cost of sales	54			196,056			108,774			174,747			(289,177		)	190,454
Gross profit (loss)	(56		)	291,074			203,751			135,010			137,901			767,680
Selling, general and administrative expenses	1,142			244,705			96,903			103,765			(734		)	445,781
Research and development expenses	—			20,222			26,676			6,788			—			53,686
Acquired intangible asset amortization	—			81,085			59,273			31,902			—			172,260
Operating earnings (loss)	(1,198		)	(54,938		)	20,899			(7,445		)	138,635			95,953
Non-operating intercompany transactions	—			71,692			261,173			(352,936		)	20,071			—
Interest income and other	—			55,260			9,188			100			(63,918		)	630
Interest expense	—			(362,215		)	(54,725		)	(85		)	63,918			(353,107		)
Foreign currency gain (loss)	—			2,470			318			(2,360		)	—			428
Derivative instruments gain (loss)	—			(28,473		)	—			—			—			(28,473		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(1,198		)	(316,204		)	236,853			(362,726		)	158,706			(284,569		)
Income tax expense (benefit)	—			(61,959		)	(16,897		)	(28,269		)	—			(107,125		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(1,198		)	(254,245		)	253,750			(334,457		)	158,706			(177,444		)
Equity in earnings (loss) of subsidiaries	(179,926		)	(73,757		)	(338,090		)	—			591,773			—
Earnings (loss) from continuing operations	(181,124		)	(328,002		)	(84,340		)	(334,457		)	750,479			(177,444		)
Earnings (loss) from discontinued operations, net of tax	—			(8,761		)	4,100			(3,633		)	4,614			(3,680		)
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Total comprehensive income (loss)	$	(182,711	)	$	(338,350	)	$	(81,827	)	$	(339,677	)	$	759,854		$	(182,711	)

Guarantor and Non-Guarantor Statement of Cash Flows

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities	3,619			249,757			397,283			35,915			(45,156		)	641,418
Net cash provided (used) by operating activities	(502,304		)	143,346			69,055			25,779			399,619			135,495
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(145,714		)	(14,556		)	(98,591		)	191,164			(67,697		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			(70		)	(4,474		)	271			—			(4,273		)
Net cash provided (used) by investing activities	—			(145,784		)	(19,030		)	(98,320		)	191,164			(71,970		)
Cash flows from financing activities:
Distribution to limited partners	(1,572		)	—			—			—			—			(1,572		)
Repayments of long-term debt and capital lease obligations	—			(60,446		)	—			17			—			(60,429		)
Payment of debt issuance costs	—			(21,604		)	—			—			—			(21,604		)
Proceeds (payments) on intercompany loans	—			51,298			(53,452		)	2,154			—			—
Proceeds (payments) on intercompany investments	503,876			(104,808		)	3,427			188,288			(590,783		)	—
Net cash provided (used) by financing activities	502,304			(135,560		)	(50,025		)	190,459			(590,783		)	(83,605		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(151		)	—			(151		)
Net increase (decrease) in cash and cash equivalents	—			(137,998		)	—			117,767			—			(20,231		)
Cash and cash equivalents, beginning of period	398			276,788			—			105,964			—			383,150
Cash and cash equivalents, end of period	$	398		$	138,790		$	—		$	223,731		$	—		$	362,919

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Adjustments to reconcile net loss to net cash provided (used) by operating activities	3,154			439,770			(123,522		)	153,344			(105,747		)	366,999
Net cash provided (used) by operating activities	(177,970		)	103,007			(203,762		)	(184,746		)	649,346			185,875
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(57,203		)	(42,323		)	(39,328		)	69,344			(69,510		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			87			(5,486		)	19			—			(5,380		)
Net cash provided (used) by investing activities	—			(57,116		)	(47,809		)	(39,309		)	69,344			(74,890		)
Cash flows from financing activities:
Capital contributions from limited partners	239			—			—			—			—			239
Distribution to limited partners	(1,970		)	—			—			—			—			(1,970		)
Repayments of long-term debt and capital lease obligations	—			(17,508		)	—			25			—			(17,483		)
Proceeds (payments) on intercompany loans	—			(120,557		)	45,537			75,020			—			—
Payment of debt issuance costs	—			(578		)	—			—			—			(578		)
Proceeds (payments) on intercompany investments	179,688			196,745			206,034			136,223			(718,690		)	—
Net cash provided (used) by financing activities	177,957			58,102			251,571			211,268			(718,690		)	(19,792		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			308			—			308
Net increase (decrease) in cash and cash equivalents	(13		)	103,993			—			(12,479		)	—			91,501
Cash and cash equivalents, beginning of period	411			142,652			—			72,363			—			215,426
Cash and cash equivalents, end of period	$	398		$	246,645		$	—		$	59,884		$	—		$	306,927

XML

Sale of Therapeutic Support Systems Assets (Tables)

9 Months Ended

Sep. 30, 2013

Discontinued Operations and Disposal Groups [Abstract]

Operating results of the TSS product portfolio included in discontinued operations

The operating results of the TSS product portfolio included in discontinued operations are as follows (in thousands):

	Three months ended September 30,					Nine months ended September 30,
	2013			2012		2013			2012
Revenue	$	—		$	52,673	$	—		$	168,107
Earnings (loss) before income tax expense (benefit)	$	(415	)	$	3,304	$	(3,738	)	$	(5,984	)
Income tax expense (benefit)	$	(160	)	$	1,272	$	(1,439	)	$	(2,304	)
Gain (loss) from discontinued operations, net of tax	$	(255	)	$	2,032	$	(2,299	)	$	(3,680	)

XML

Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Statement of Operations and Comprehensive Income (Loss) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012		Sep. 30, 2013		Sep. 30, 2012
Condensed Income Statements, Captions [Line Items]
Rental	$ 191,041		$ 207,156		$ 569,449		$ 622,350
Sales	249,520		228,717		719,675		684,171
Total revenue	440,561		435,873		1,289,124		1,306,521
Rental expenses	85,746		100,810		273,479		348,387
Cost of sales	66,151		58,613		181,707		190,454
Gross profit (loss)	288,664		276,450		833,938		767,680
Selling, general and administrative expenses	152,053		142,778		518,478		445,781
Research and development expenses	17,961		17,376		56,140		53,686
Acquired intangible asset amortization	45,116		49,733		139,123		172,260
Impairment of goodwill and intangible assets	443,400	[1]	0	[1]	443,400	[1]	0	[1]
Operating earnings (loss)	(369,866)		66,563		(323,203)		95,953
Non-operating intercompany transactions	0		0		0		0
Interest income and other	217		174		1,279		630
Interest expense	(101,398)		(117,920)		(315,144)		(353,107)
Loss on extinguishment of debt	(200)		0		(2,364)		0
Foreign currency gain (loss)	(8,738)		(5,258)		(11,935)		428
Derivative instruments loss	(6,840)		(8,579)		3,200		(28,473)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(486,825)		(65,020)		(648,167)		(284,569)
Income tax expense (benefit)	(88,519)		(27,176)		(144,543)		(107,125)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(398,306)		(37,844)		(503,624)		(177,444)
Equity in earnings (loss) of subsidiaries	0		0		0		0
Earnings (loss) from continuing operations	(398,306)		(37,844)		(503,624)		(177,444)
Earnings (loss) from discontinued operations, net of tax	(255)		2,032		(2,299)		(3,680)
Net earnings (loss)	(398,561)		(35,812)		(505,923)		(181,124)
Total comprehensive income (loss)	(403,151)		(34,215)		(512,932)		(182,711)
Parent Company [Member]
Condensed Income Statements, Captions [Line Items]
Rental	0		0		0		0
Sales	0		0		0		0
Total revenue	0		0		0		0
Rental expenses	0		0		13		2
Cost of sales	30		18		84		54
Gross profit (loss)	(30)		(18)		(97)		(56)
Selling, general and administrative expenses	820		191		1,949		1,142
Research and development expenses	0		0		0		0
Acquired intangible asset amortization	0		0		0		0
Impairment of goodwill and intangible assets	0				0
Operating earnings (loss)	(850)		(209)		(2,046)		(1,198)
Non-operating intercompany transactions	0		0		0		0
Interest income and other	0		0		0		0
Interest expense	0		0		0		0
Loss on extinguishment of debt	0				0
Foreign currency gain (loss)	0		0		0		0
Derivative instruments loss	0		0		0		0
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(850)		(209)		(2,046)		(1,198)
Income tax expense (benefit)	0		0		0		0
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(850)		(209)		(2,046)		(1,198)
Equity in earnings (loss) of subsidiaries	(397,711)		(35,603)		(503,877)		(179,926)
Earnings (loss) from continuing operations	(398,561)		(35,812)		(505,923)		(181,124)
Earnings (loss) from discontinued operations, net of tax	0		0		0		0
Net earnings (loss)	(398,561)		(35,812)		(505,923)		(181,124)
Total comprehensive income (loss)	(403,151)		(34,215)		(512,932)		(182,711)
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member]
Condensed Income Statements, Captions [Line Items]
Rental	155,893		164,641		461,605		495,299
Sales	77,659		74,943		221,296		218,950
Total revenue	233,552		239,584		682,901		714,249
Rental expenses	62,928		62,877		186,426		227,119
Cost of sales	123,481		89,027		221,212		196,056
Gross profit (loss)	47,143		87,680		275,263		291,074
Selling, general and administrative expenses	66,834		75,731		269,490		244,705
Research and development expenses	8,010		6,268		23,366		20,222
Acquired intangible asset amortization	19,625		22,308		61,276		81,085
Impairment of goodwill and intangible assets	0				0
Operating earnings (loss)	(47,326)		(16,627)		(78,869)		(54,938)
Non-operating intercompany transactions	(8,076)		5,318		52,176		71,692
Interest income and other	17,852		18,532		54,046		55,260
Interest expense	(104,402)		(120,964)		(324,163)		(362,215)
Loss on extinguishment of debt	(200)				(2,364)
Foreign currency gain (loss)	(14,433)		(6,651)		(8,953)		2,470
Derivative instruments loss	(6,840)		(8,579)		3,200		(28,473)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(163,425)		(128,971)		(304,927)		(316,204)
Income tax expense (benefit)	(51,104)		(22,700)		(97,201)		(61,959)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(112,321)		(106,271)		(207,726)		(254,245)
Equity in earnings (loss) of subsidiaries	48,780		28,741		104,040		(73,757)
Earnings (loss) from continuing operations	(63,541)		(77,530)		(103,686)		(328,002)
Earnings (loss) from discontinued operations, net of tax	(331)		(1,468)		(2,725)		(8,761)
Net earnings (loss)	(63,872)		(78,998)		(106,411)		(336,763)
Total comprehensive income (loss)	(68,462)		(77,401)		(113,420)		(338,350)
Guarantor Subsidiaries [Member]
Condensed Income Statements, Captions [Line Items]
Rental	1,513		1,741		4,766		4,507
Sales	224,426		103,716		640,681		312,106
Total revenue	225,939		105,457		645,447		316,613
Rental expenses	4,010		1,526		12,180		4,088
Cost of sales	142,946		34,023		396,855		108,774
Gross profit (loss)	78,983		69,908		236,412		203,751
Selling, general and administrative expenses	44,169		32,926		136,734		96,903
Research and development expenses	6,742		8,977		23,263		26,676
Acquired intangible asset amortization	17,907		18,687		54,274		59,273
Impairment of goodwill and intangible assets	443,400				443,400
Operating earnings (loss)	(433,235)		9,318		(421,259)		20,899
Non-operating intercompany transactions	49,735		132,861		108,489		261,173
Interest income and other	3,062		3,063		9,188		9,188
Interest expense	(17,756)		(18,375)		(52,974)		(54,725)
Loss on extinguishment of debt	0				0
Foreign currency gain (loss)	(38)		170		(251)		318
Derivative instruments loss	0		0		0		0
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(398,232)		127,037		(356,807)		236,853
Income tax expense (benefit)	(34,535)		14,055		(38,718)		(16,897)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(363,697)		112,982		(318,089)		253,750
Equity in earnings (loss) of subsidiaries	(20,950)		(83,578)		(10,136)		(338,090)
Earnings (loss) from continuing operations	(384,647)		29,404		(328,225)		(84,340)
Earnings (loss) from discontinued operations, net of tax	(1)		627		(3)		4,100
Net earnings (loss)	(384,648)		30,031		(328,228)		(80,240)
Total comprehensive income (loss)	(389,238)		31,628		(335,237)		(81,827)
Non-Guarantor Subsidiaries [Member]
Condensed Income Statements, Captions [Line Items]
Rental	33,635		40,774		103,078		122,544
Sales	159,142		151,225		481,490		388,453
Total revenue	192,777		191,999		584,568		510,997
Rental expenses	53,891		61,744		167,226		201,240
Cost of sales	57,512		58,201		177,420		174,747
Gross profit (loss)	81,374		72,054		239,922		135,010
Selling, general and administrative expenses	40,261		33,978		110,515		103,765
Research and development expenses	3,209		2,131		9,511		6,788
Acquired intangible asset amortization	7,584		8,738		23,573		31,902
Impairment of goodwill and intangible assets	0				0
Operating earnings (loss)	30,320		27,207		96,323		(7,445)
Non-operating intercompany transactions	(60,212)		(131,367)		(112,565)		(352,936)
Interest income and other	97		18		166		100
Interest expense	(34)		(20)		(128)		(85)
Loss on extinguishment of debt	0				0
Foreign currency gain (loss)	5,733		1,223		(2,731)		(2,360)
Derivative instruments loss	0		0		0		0
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(24,096)		(102,939)		(18,935)		(362,726)
Income tax expense (benefit)	(2,880)		(18,531)		(8,624)		(28,269)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(21,216)		(84,408)		(10,311)		(334,457)
Equity in earnings (loss) of subsidiaries	0		0		0		0
Earnings (loss) from continuing operations	(21,216)		(84,408)		(10,311)		(334,457)
Earnings (loss) from discontinued operations, net of tax	266		830		175		(3,633)
Net earnings (loss)	(20,950)		(83,578)		(10,136)		(338,090)
Total comprehensive income (loss)	(25,540)		(81,981)		(17,145)		(339,677)
Eliminations [Member]
Condensed Income Statements, Captions [Line Items]
Rental	0		0		0		0
Sales	(211,707)		(101,167)		(623,792)		(235,338)
Total revenue	(211,707)		(101,167)		(623,792)		(235,338)
Rental expenses	(35,083)		(25,337)		(92,366)		(84,062)
Cost of sales	(257,818)		(122,656)		(613,864)		(289,177)
Gross profit (loss)	81,194		46,826		82,438		137,901
Selling, general and administrative expenses	(31)		(48)		(210)		(734)
Research and development expenses	0		0		0		0
Acquired intangible asset amortization	0		0		0		0
Impairment of goodwill and intangible assets	0				0
Operating earnings (loss)	81,225		46,874		82,648		138,635
Non-operating intercompany transactions	18,553		(6,812)		(48,100)		20,071
Interest income and other	(20,794)		(21,439)		(62,121)		(63,918)
Interest expense	20,794		21,439		62,121		63,918
Loss on extinguishment of debt	0				0
Foreign currency gain (loss)	0		0		0		0
Derivative instruments loss	0		0		0		0
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	99,778		40,062		34,548		158,706
Income tax expense (benefit)	0		0		0		0
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	99,778		40,062		34,548		158,706
Equity in earnings (loss) of subsidiaries	369,881		90,440		409,973		591,773
Earnings (loss) from continuing operations	469,659		130,502		444,521		750,479
Earnings (loss) from discontinued operations, net of tax	(189)		2,043		254		4,614
Net earnings (loss)	469,470		132,545		444,775		755,093
Total comprehensive income (loss)	$ 483,240		$ 127,754		$ 465,802		$ 759,854

[1] During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Sale of Therapeutic Support Systems Assets (Details) (USD $)	0 Months Ended	3 Months Ended		9 Months Ended
	Nov. 08, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Proceeds from Divestiture of Businesses	$ 241,500,000
Operating results of the TSS product portfolio included in discontinued operations
Revenue		0	52,673,000	0	168,107,000
Earnings (loss) before income tax expense (benefit)		(415,000)	3,304,000	(3,738,000)	(5,984,000)
Income tax expense (benefit)		(160,000)	1,272,000	(1,439,000)	(2,304,000)
Gain (loss) from discontinued operations, net of tax		$ (255,000)	$ 2,032,000	$ (2,299,000)	$ (3,680,000)

XML

Business Acquisition (Details) (Systagenix [Member], USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Sep. 30, 2013 Countries	Dec. 31, 2012	Jul. 30, 2013 employee
Business Acquisition [Line Items]
Business Acquisition, Cost of Acquired Entity, Purchase Price			$ 485.0
Number of Advanced Wound Dressings, Monthly	20
Business Acquisition, number of countries in which entity operates	70
Business Acquisition, Estimated Annual Revenue		200.0
Business Acquisition, number of employees			800
Senior Dollar Term D-1 Credit Facility Due 2018 [Member]
Business Acquisition [Line Items]
Business Acquisition, Incremental Borrowing			$ 350.0

XML

Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012
Accumulated other comprehensive income (loss), net	$ (7,526)		$ (7,526)		$ (517)
Unrealized investment gain, net of tax expense of $1,413	541	0	2,257	0
Foreign currency translation adjustment, net of tax benefit of $259	(5,131)	1,597	(9,266)	(1,587)
Accumulated Net Unrealized Investment Gain (Loss) [Member]
Accumulated other comprehensive income (loss), net	2,257		2,257		0
Foreign currency translation adjustment, net of tax benefit of $259			0
Accumulated Other Comprehensive Income (Loss) [Member]
Accumulated other comprehensive income (loss), net	(7,526)		(7,526)		(517)
Unrealized investment gain, net of tax expense of $1,413			2,257
Foreign currency translation adjustment, net of tax benefit of $259			(9,266)
Accumulated Translation Adjustment [Member]
Other Comprehensive Income (Loss), Reclassification Adjustment on Derivatives Included in Net Income, before Tax			0
Accumulated other comprehensive income (loss), net	(9,783)		(9,783)		(517)
Unrealized investment gain, net of tax expense of $1,413			$ 0

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Derivative Financial Instruments and Fair Value Measurements - Derivative Financial Instruments (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Interest Rate Protection [Abstract]
Collateral posted	$ 0
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Interest Rate Protection [Abstract]
Notional amount of nondesignated interest rate derivatives	1,600,000,000	1,600,000,000
Cost of derivative	2,200,000	2,200,000
Derivative, cap interest rate	2.00%	2.00%
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member]
Interest Rate Protection [Abstract]
Number of interest rate agreements held	3	3
Derivative, quarterly interest payments, receive rates, maximum	1.25%
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.256%, effective December 31, 2013 [Member]
Interest Rate Protection [Abstract]
Notional amount of nondesignated interest rate derivatives	512,633,000
Fixed Interest Rate	2.256%
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.249%, effective December 31, 2013 [Member]
Interest Rate Protection [Abstract]
Notional amount of nondesignated interest rate derivatives	512,633,000
Fixed Interest Rate	2.249%
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Interest Rate Swap - 2.250%, effective December 31, 2013 [Member]
Interest Rate Protection [Abstract]
Notional amount of nondesignated interest rate derivatives	512,633,000
Fixed Interest Rate	2.25%
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Minimum [Member]
Interest Rate Protection [Abstract]
Notional amount decreases by quarter	1,700,000
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Maximum [Member]
Interest Rate Protection [Abstract]
Notional amount decreases by quarter	56,400,000
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member]
Foreign Currency Exchange Risk Mitigation [Abstract]
Notional amount of nondesignated foreign currency derivatives	34,800,000	59,100,000
Senior Secured Credit Facility [Member]
Derivative [Line Items]
Long-term Debt, Fair Value	2,300,000,000	2,300,000,000
Fixed Rate Long-Term Debt [Member]
Derivative [Line Items]
Long-term Debt, Fair Value	$ 2,600,000,000	$ 2,400,000,000

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Summary of Significant Accounting Policies (Details) (USD $)	0 Months Ended	3 Months Ended		9 Months Ended			9 Months Ended
	Nov. 08, 2012	Sep. 30, 2013 segment	Sep. 30, 2012	Sep. 30, 2013 segment	Sep. 30, 2012	Sep. 30, 2013 Interest Rate Swap [Member] Concentration of Credit Risk [Member]	Sep. 30, 2013 LifeCell Corporation [Member]	Oct. 31, 2012 LifeCell Corporation [Member]
Accounting Policies [Line Items]
Proceeds from Divestiture of Businesses	$ 241,500,000
Basis of Presentation and Principles of Consolidation [Abstract]
Number of reportable operating segments		2		2
Number of global business units		2		2
Number of primary geographic regions		2		2
Concentration of Credit Risk [Abstract]
Notional amount of interest rate swap and cap agreements						1,031,000,000
Fixed asset and inventory impairment			9,700,000	30,259,000	22,116,000
Potential Drop in Fair Value of Reporting Unit								6.00%
Potential Drop in Fair Value of Identifiable Intangible Assets								4.00%
Goodwill, Impairment Loss							272,200,000
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)							171,200,000
Write-off of other intangible assets		$ 3,500,000		$ 16,885,000	$ 0

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Condensed Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (505,923)		$ (181,124)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of debt issuance costs and discount	26,356		24,417
Depreciation and other amortization	252,026		346,895
Loss on disposition of assets	3,189		0
Amortization of fair value step-up in inventory	0		25,021
Fixed asset and inventory impairment	30,259		22,116
Impairment of goodwill and intangible assets	443,400	[1]	0	[1]
Write-off of other intangible assets	16,885		0
Provision for bad debt	5,051		7,019
Loss on extinguishment of debt	2,164		0
Equity-based compensation expense	2,046		1,186
Deferred income tax benefit	(165,456)		(132,639)
Unrealized loss (gain) on derivative instruments	(5,729)		27,770
Unrealized loss (gain) on revaluation of cross currency debt	8,174		(2,685)
Change in assets and liabilities:
Decrease (increase) in accounts receivable, net	(23,046)		10,675
Increase in inventories, net	(10,498)		(7,270)
Decrease (increase) in prepaid expenses and other	(17,137)		3,281
Increase (decrease) in accounts payable	3,273		(9,445)
Increase in accrued expenses and other	68,440		48,359
Increase in tax liabilities, net	2,021		2,299
Net cash provided (used) by operating activities	135,495		185,875
Cash flows from investing activities
Additions to property, plant and equipment	(59,868)		(72,044)
Increase (decrease) in inventory to be converted into equipment for short-term rental	(8,881)		861
Dispositions of property, plant and equipment	1,052		1,673
Increase in identifiable intangible assets and other non-current assets	(4,273)		(5,380)
Net cash provided (used) by investing activities	(71,970)		(74,890)
Cash flows from financing activities:
Capital contributions from limited partners	0		239
Distribution to limited partners	(1,572)		(1,970)
Repayments of long-term debt and capital lease obligations	(60,429)		(17,483)
Payment of debt issuance costs	(21,604)		(578)
Net cash provided (used) by financing activities	(83,605)		(19,792)
Effect of exchange rate changes on cash and cash equivalents	(151)		308
Net increase (decrease) in cash and cash equivalents	(20,231)		91,501
Cash and cash equivalents, beginning of period	383,150		215,426
Cash and cash equivalents, end of period	$ 362,919		$ 306,927

[1] During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Business Acquisition Business Acquisition

9 Months Ended

Sep. 30, 2013

Business Acquisition [Abstract]

Business Combination Disclosure [Text Block]

Business Acquisition

On July 30, 2013, KCI announced that it had signed a definitive share purchase agreement to acquire Systagenix, an established provider of advanced wound care ("AWC") products. The transaction closed on October 28, 2013. At the closing of the transaction, KCI paid a purchase price of $485.0 million, subject to adjustment, using $350.0 million of incremental borrowings under our existing senior secured credit facility along with cash on hand to fund the purchase price. The acquisition will be accounted for as a business combination using the acquisition method. Once our preliminary purchase price allocation has been completed, the purchase price will be allocated to the Systagenix tangible and identifiable intangible assets based on their estimated fair values as of the acquisition date. Any excess of the purchase price over the identifiable intangible and net tangible assets will be allocated to goodwill, which is not deductible for tax purposes.

Systagenix has a broad portfolio of innovative advanced wound care products with a focus on moist wound healing dressings - including PROMOGRAN PRISMA®, the collagen dressing market leader, TIELLE® (foam) and ADAPTIC® (non adherent contact layers). Systagenix's manufacturing, marketing and sales teams supply and distribute over 20 million advanced wound care dressings each month to more than 70 countries. The company, formerly part of Johnson & Johnson, generates annual revenue of approximately $200.0 million and has approximately 800 employees worldwide, including an experienced team of research and development scientists dedicated to advancing skin and wound care. Combining Systagenix's expertise with KCI's innovation pipeline and scale will create additional value for customers and help speed healing and reduce complications for patients.

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Long-Term Debt

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Long-term debt consists of the following (in thousands):

	September 30, 2013			December 31, 2012
Senior Dollar Term D-1 Credit Facility (1) – due 2018	$	1,601,607		$	1,613,700
Senior Euro Term D-1 Credit Facility (1) – due 2018	332,186			327,022
Senior Term D-2 Credit Facility (1) – due 2016	319,339			321,750
10.5% Second Lien Senior Secured Notes due 2018	1,750,000			1,750,000
12.5% Senior Unsecured Notes due 2019	612,000			650,000
3.25% Convertible Senior Notes due 2015	101			701
IBM Financing	2,271			—
Notional amount of debt	4,617,504			4,663,173
Senior Dollar Term D-1 Credit Facility Discount, net of accretion	(32,100		)	(33,840		)
Senior Euro Term D-1 Credit Facility Discount, net of accretion	(11,033		)	(13,353		)
Senior Term D-2 Credit Facility Discount, net of accretion	(4,860		)	(7,064		)
Second Lien Senior Secured Notes Discount, net of accretion	(25,160		)	(27,827		)
Senior Unsecured Notes Discount, net of accretion	(3,111		)	(3,594		)
Net discount on debt	(76,264		)	(85,678		)
Total debt, net of discount	4,541,240			4,577,495
Less:  Current installments	(24,101		)	(23,383		)
	$	4,517,139		$	4,554,112

_____________________________

(1) On June 14, 2013, we entered into Amendment No. 2 to our senior secured credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment.

Senior Secured Credit Facility

Our senior secured credit facility (the “Senior Secured Credit Facility”) includes a $200 million revolving credit facility (the “Revolving Credit Facility”). Amounts available under the Revolving Credit Facility are available for borrowing and reborrowing until maturity. At September 30, 2013 and December 31, 2012, no revolving credit loans were outstanding and we had outstanding letters of credit issued by banks which are party to the Senior Secured Credit Facility of $10.7 million and $11.5 million, respectively. In addition, we had $3.5 million and $4.6 million of letters of credit issued by a bank not party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The capacity of the Revolving Credit Facility is reduced for the $10.7 million and $11.5 million of letters of credit issued by banks which are party to the Senior Secured Credit Facility as of September 30, 2013 and December 31, 2012, respectively. The resulting availability under the Revolving Credit Facility was $189.3 million and $188.5 million at September 30, 2013 and December 31, 2012, respectively. Commitment fees accrue at a rate of 0.375% on the amounts available under the Revolving Credit Facility.

On June 14, 2013, we entered into Amendment No. 2 to our Senior Secured Credit Facility ("Amendment No. 2"). As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment. In connection with Amendment No. 2, Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans were refinanced with Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, respectively.

In connection with our acquisition of Systagenix, we borrowed $350.0 million of incremental term D-1 loans (the "Incremental Loans") incurred pursuant to Amendment No. 3 to our Senior Secured Credit Facility, dated as of October 28, 2013. The Incremental Loans were issued at a discount of $0.4 million. The interest rate and all other terms are identical to our previously-existing Dollar Term D-1 Loans.

Interest. Amounts outstanding under the Dollar Term D-1 Loans, the Term D-2 Loans and the Revolving Credit Facility (other than swing-line loans and unreimbursed drawings on letters of credit) bear interest, at our option, at a rate equal to either the base rate or the eurocurrency rate, in each case plus an applicable margin. Amounts outstanding under the Euro Term D-1 Loans bear interest at the eurocurrency rate, and swing-line loans and unreimbursed drawings on letters of credit bear interest at the base rate. As a result of Amendment No. 2, the new applicable margins are (i) for eurocurrency rate loans that are Dollar Term D-1 Loans, 3.50%, (ii) for base rate loans that are Dollar Term D-1 Loans, 2.50%, (iii) for eurocurrency rate loans that are Euro Term D-1 Loans, 3.75%, (iv) for base rate loans that are Euro Term D-1 Loans, 2.75%, (v) for eurocurrency rate loans that are Term D-2 Loans, 3.00%, and (vi) for base rate loans that are Term D-2 Loans, 2.00%. The Term D loans will have a eurocurrency rate floor of 1.00% and a base rate floor of 2.00%.

10.5% Second Lien Senior Secured Notes and 12.5% Senior Unsecured Notes

As required upon the closing of our 10.5% Second Lien Senior Secured Notes due 2018 (“10.5% Second Lien Notes”) and the 12.5% Senior Unsecured Notes due 2019 (“12.5% Unsecured Notes”), we have entered into registration rights agreements with respect to these notes. Pursuant to the terms of the registration rights agreements, we filed a registration statement (the “Registration Statement”) with respect to a registered exchange offer to exchange such notes for new notes with terms substantially identical in all material respects with the notes (except for the provisions relating to the transfer restrictions and payment of additional interest). On February 13, 2013, our Registration Statement was declared effective by the Securities and Exchange Commission (“SEC”), and our exchange offer was completed on March 15, 2013.

Because our Registration Statement was not declared effective by the SEC under the Securities Act and the exchange offer was not consummated within 365 days following the issuance of the notes (“Exchange Date”), and because we did not file a shelf registration statement covering resales of the notes within 30 days after the Exchange Date (each a “Notes Registration Default”), additional interest accrued on the aggregate principal amount of the notes from and including the date on which any such Notes Registration Default occurred to but excluding the date on which the Notes Registration Defaults were cured through the completion of the exchange offer. Under the terms of the registration rights agreements entered into with respect to these notes, additional interest was accrued at a rate of 0.25% and 0.50% from November 4, 2012 to February 4, 2013 and February 5, 2013 to March 15, 2013, respectively.

During the nine months ended September 30, 2013, we repurchased $38.0 million in principal of our 12.5% Unsecured Notes.

Covenants

As of September 30, 2013, we were in compliance with all covenants under our Senior Secured Credit Facility, 10.5% Second Lien Notes, 12.5% Unsecured Notes, and 3.25% Convertible Senior Notes due 2015 (“the Convertible Notes”).

For further information on our long-term debt, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

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Sale of Therapeutic Support Systems Assets

9 Months Ended

Sep. 30, 2013

Discontinued Operations and Disposal Groups [Abstract]

Sale of Therapeutic Support Systems Assets

Sale of Therapeutic Support Systems Assets

On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's TSS business. The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. The historical results of operations of the disposal group, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

The Company utilized the net proceeds from the sale to fund the acquisition of Systagenix and internal investments, which satisfied our reinvestment requirement. Therefore, we do not anticipate having a repayment requirement in the fourth quarter associated with the sale of our TSS business.

The operating results of the TSS product portfolio included in discontinued operations are as follows (in thousands):

	Three months ended September 30,					Nine months ended September 30,
	2013			2012		2013			2012
Revenue	$	—		$	52,673	$	—		$	168,107
Earnings (loss) before income tax expense (benefit)	$	(415	)	$	3,304	$	(3,738	)	$	(5,984	)
Income tax expense (benefit)	$	(160	)	$	1,272	$	(1,439	)	$	(2,304	)
Gain (loss) from discontinued operations, net of tax	$	(255	)	$	2,032	$	(2,299	)	$	(3,680	)

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Supplemental Balance Sheet Data - Accounts Receivable, Net (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Accounts, Notes, Loans and Financing Receivable [Line Items]
Billed trade accounts receivable	$ 382,538	$ 370,708
Unbilled receivables	49,350	45,466
Less: Allowance for revenue adjustments	(69,546)	(71,770)
Gross trade accounts receivable	362,342	344,404
Less: Allowance for bad debt	(7,017)	(4,768)
Net trade accounts receivable	355,325	339,636
Other receivables	13,575	16,082
Accounts receivable, net	$ 368,900	$ 355,718

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Derivative Financial Instruments and Fair Value Measurements - Fair Value and Balance Sheet Locations (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	$ 230	$ 529
Derivative liability, fair value	31,820	37,848
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Other non-current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	0	0
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	0	0
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Other non-current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	30,482	34,868
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Accrued expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	330	0
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	0	9
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member] | Accrued expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	0	0
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | Prepaid expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	230	520
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member] | Accrued expenses and other [Member]
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	$ 1,008	$ 2,980

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Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Balance Sheet (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012	Sep. 30, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 362,919	$ 383,150	$ 306,927	$ 215,426
Accounts receivable, net	368,900	355,718
Inventories, net	149,986	139,850
Deferred Tax Assets, Net of Valuation Allowance, Current		0
Prepaid expenses and other	59,499	39,511
Intercompany receivables	0	0
Total current assets	941,304	918,229
Net property, plant and equipment	312,555	388,482
Debt issuance costs, net	101,766	96,476
Deferred income taxes	21,866	20,003
Goodwill	3,207,575	3,479,775
Identifiable intangible assets, net	2,343,525	2,666,201
Other non-current assets	4,054	5,598
Intercompany loan receivables	0	0
Intercompany investments	0	0
Total assets	6,932,645	7,574,764
Current liabilities:
Accounts payable	44,527	40,970
Accrued expenses and other	351,903	284,163
Intercompany payables	0	0
Current installments of long-term debt	24,101	23,383
Income taxes payable	0	0
Deferred income taxes	4,610	57,528
Total current liabilities	425,141	406,044
Long-term debt, net of current installments and discount	4,517,139	4,554,112
Non-current tax liabilities	46,461	44,465
Deferred income taxes	960,219	1,069,480
Other non-current liabilities	38,897	43,267
Intercompany loan payables	0	0
Total liabilities	5,987,857	6,117,368
Equity:
Total equity	944,788	1,457,396
Total liabilities and shareholders' equity	6,932,645	7,574,764
Parent Company [Member]
Current assets:
Cash and cash equivalents	398	398	398	411
Accounts receivable, net	0	0
Inventories, net	0	0
Deferred Tax Assets, Net of Valuation Allowance, Current		0
Prepaid expenses and other	0	0
Intercompany receivables	166	166
Total current assets	564	564
Net property, plant and equipment	0	0
Debt issuance costs, net	0	0
Deferred income taxes	0	0
Goodwill	0	0
Identifiable intangible assets, net	0	0
Other non-current assets	0	0
Intercompany loan receivables	0	0
Intercompany investments	948,376	1,459,261
Total assets	948,940	1,459,825
Current liabilities:
Accounts payable	0	0
Accrued expenses and other	0	0
Intercompany payables	3,934	2,361
Current installments of long-term debt	0	0
Income taxes payable	0	0
Deferred income taxes	0	0
Total current liabilities	3,934	2,361
Long-term debt, net of current installments and discount	0	0
Non-current tax liabilities	0	0
Deferred income taxes	0	0
Other non-current liabilities	218	68
Intercompany loan payables	0	0
Total liabilities	4,152	2,429
Equity:
Total equity	944,788	1,457,396
Total liabilities and shareholders' equity	948,940	1,459,825
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member]
Current assets:
Cash and cash equivalents	138,790	276,788	246,645	142,652
Accounts receivable, net	184,370	174,534
Inventories, net	63,219	94,345
Deferred Tax Assets, Net of Valuation Allowance, Current		38,451
Prepaid expenses and other	41,376	25,083
Intercompany receivables	1,400,317	1,337,915
Total current assets	1,828,072	1,947,116
Net property, plant and equipment	297,648	281,950
Debt issuance costs, net	101,766	96,476
Deferred income taxes	0	0
Goodwill	2,483,240	2,483,240
Identifiable intangible assets, net	380,314	441,620
Other non-current assets	424	324
Intercompany loan receivables	785,000	800,000
Intercompany investments	406,067	302,027
Total assets	6,282,531	6,352,753
Current liabilities:
Accounts payable	16,089	17,869
Accrued expenses and other	234,359	172,356
Intercompany payables	788,613	723,096
Current installments of long-term debt	22,760	23,383
Income taxes payable	1,495	(1,452)
Deferred income taxes	(34,267)	0
Total current liabilities	1,029,049	935,252
Long-term debt, net of current installments and discount	4,516,223	4,554,112
Non-current tax liabilities	42,084	36,711
Deferred income taxes	56,892	115,652
Other non-current liabilities	37,242	41,360
Intercompany loan payables	402,433	366,135
Total liabilities	6,083,923	6,049,222
Equity:
Total equity	198,608	303,531
Total liabilities and shareholders' equity	6,282,531	6,352,753
Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	0	0	0	0
Accounts receivable, net	73,382	58,244
Inventories, net	92,060	71,676
Deferred Tax Assets, Net of Valuation Allowance, Current		0
Prepaid expenses and other	5,913	6,591
Intercompany receivables	2,270,890	2,149,981
Total current assets	2,442,245	2,286,492
Net property, plant and equipment	82,391	79,049
Debt issuance costs, net	0	0
Deferred income taxes	0	0
Goodwill	724,335	996,535
Identifiable intangible assets, net	1,809,207	2,045,091
Other non-current assets	186	186
Intercompany loan receivables	404,586	366,134
Intercompany investments	406,253	409,702
Total assets	5,869,203	6,183,189
Current liabilities:
Accounts payable	12,540	13,093
Accrued expenses and other	238,528	236,838
Intercompany payables	2,508,621	2,389,863
Current installments of long-term debt	1,341	0
Income taxes payable	0	0
Deferred income taxes	42,519	99,621
Total current liabilities	2,803,549	2,739,415
Long-term debt, net of current installments and discount	916	0
Non-current tax liabilities	0	0
Deferred income taxes	852,886	888,597
Other non-current liabilities	298	375
Intercompany loan payables	785,000	800,000
Total liabilities	4,442,649	4,428,387
Equity:
Total equity	1,426,554	1,754,802
Total liabilities and shareholders' equity	5,869,203	6,183,189
Non-Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	223,731	105,964	59,884	72,363
Accounts receivable, net	111,148	122,940
Inventories, net	78,178	60,635
Deferred Tax Assets, Net of Valuation Allowance, Current		3,642
Prepaid expenses and other	342,209	294,437
Intercompany receivables	149,321	147,473
Total current assets	904,587	735,091
Net property, plant and equipment	197,071	190,419
Debt issuance costs, net	0	0
Deferred income taxes	21,866	20,003
Goodwill	0	0
Identifiable intangible assets, net	154,004	179,490
Other non-current assets	94,344	95,988
Intercompany loan receivables	0	0
Intercompany investments	0	0
Total assets	1,371,872	1,220,991
Current liabilities:
Accounts payable	15,898	10,008
Accrued expenses and other	61,948	62,226
Intercompany payables	519,526	520,215
Current installments of long-term debt	0	0
Income taxes payable	(1,495)	1,452
Deferred income taxes	(3,642)	0
Total current liabilities	592,235	593,901
Long-term debt, net of current installments and discount	0	0
Non-current tax liabilities	4,377	7,754
Deferred income taxes	50,441	65,231
Other non-current liabilities	1,139	1,464
Intercompany loan payables	2,153	0
Total liabilities	650,345	668,350
Equity:
Total equity	721,527	552,641
Total liabilities and shareholders' equity	1,371,872	1,220,991
Eliminations [Member]
Current assets:
Cash and cash equivalents	0	0	0	0
Accounts receivable, net	0	0
Inventories, net	(83,471)	(86,806)
Deferred Tax Assets, Net of Valuation Allowance, Current		(42,093)
Prepaid expenses and other	(329,999)	(286,600)
Intercompany receivables	(3,820,694)	(3,635,535)
Total current assets	(4,234,164)	(4,051,034)
Net property, plant and equipment	(264,555)	(162,936)
Debt issuance costs, net	0	0
Deferred income taxes	0	0
Goodwill	0	0
Identifiable intangible assets, net	0	0
Other non-current assets	(90,900)	(90,900)
Intercompany loan receivables	(1,189,586)	(1,166,134)
Intercompany investments	(1,760,696)	(2,170,990)
Total assets	(7,539,901)	(7,641,994)
Current liabilities:
Accounts payable	0	0
Accrued expenses and other	(182,932)	(187,257)
Intercompany payables	(3,820,694)	(3,635,535)
Current installments of long-term debt	0	0
Income taxes payable	0	0
Deferred income taxes	0	(42,093)
Total current liabilities	(4,003,626)	(3,864,885)
Long-term debt, net of current installments and discount	0	0
Non-current tax liabilities	0	0
Deferred income taxes	0	0
Other non-current liabilities	0	0
Intercompany loan payables	(1,189,586)	(1,166,135)
Total liabilities	(5,193,212)	(5,031,020)
Equity:
Total equity	(2,346,689)	(2,610,974)
Total liabilities and shareholders' equity	$ (7,539,901)	$ (7,641,994)

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Condensed Consolidated Statements of Operations (USD $) In Thousands, unless otherwise specified	3 Months Ended				9 Months Ended
	Sep. 30, 2013		Sep. 30, 2012		Sep. 30, 2013		Sep. 30, 2012
Revenue:
Rental	$ 191,041		$ 207,156		$ 569,449		$ 622,350
Sales	249,520		228,717		719,675		684,171
Total revenue	440,561		435,873		1,289,124		1,306,521
Rental expenses	85,746		100,810		273,479		348,387
Cost of sales	66,151		58,613		181,707		190,454
Gross profit (loss)	288,664		276,450		833,938		767,680
Selling, general and administrative expenses	152,053		142,778		518,478		445,781
Research and development expenses	17,961		17,376		56,140		53,686
Acquired intangible asset amortization	45,116		49,733		139,123		172,260
Impairment of goodwill and intangible assets	443,400	[1]	0	[1]	443,400	[1]	0	[1]
Operating earnings (loss)	(369,866)		66,563		(323,203)		95,953
Interest income and other	217		174		1,279		630
Interest expense	(101,398)		(117,920)		(315,144)		(353,107)
Loss on extinguishment of debt	(200)		0		(2,364)		0
Foreign currency gain (loss)	(8,738)		(5,258)		(11,935)		428
Derivative instruments gain (loss)	(6,840)		(8,579)		3,200		(28,473)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(486,825)		(65,020)		(648,167)		(284,569)
Income tax benefit	(88,519)		(27,176)		(144,543)		(107,125)
Earnings (loss) from continuing operations	(398,306)		(37,844)		(503,624)		(177,444)
Gain (loss) from discontinued operations, net of tax	(255)		2,032		(2,299)		(3,680)
Net earnings (loss)	$ (398,561)		$ (35,812)		$ (505,923)		$ (181,124)

[1] During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

LEGAL PROCEEDINGS

Intellectual Property Litigation

As the owner and exclusive licensee of patents, from time to time, we are a party to proceedings challenging these patents, including challenges in U.S. federal courts, foreign courts, foreign patent offices and the U.S. Patent and Trademark Office. Additionally, from time to time, we are a party to litigation we initiate against others we contend infringe these patents, which often results in counterclaims regarding the validity of such patents. At other times, we are party to litigation initiated by others who contend we infringe their patents. It is not possible to reliably predict the outcome of the proceedings described below. However, if we are unable to effectively enforce our intellectual property rights, third parties may become more aggressive in the marketing of competitive products around the world.

Smith & Nephew Litigation

In 1993, KCI exclusively licensed several patent applications from Wake Forest University relating to negative pressure wound therapy (“NPWT”) that ultimately issued in several countries. In the following years, KCI developed and began marketing V.A.C.^® Therapy, the first commercially available NPWT system. In 2003, BlueSky Medical launched the first competitive NPWT system. Unlike KCI, BlueSky commercialized a gauze-based system that utilized pumps manufactured by Medela AG (“Medela”). Shortly thereafter, KCI and Wake Forest sued BlueSky and Medela for infringement of the patents KCI licensed from Wake Forest. Following a jury trial in the Federal District Court for the Western District of Texas (“Western District”) in 2006, a judgment was entered holding that BlueSky's gauze-based NPWT system did not infringe these patents. That judgment was appealed to the United States Court of Appeals for the Federal Circuit (“Federal Circuit”), which affirmed the judgment of the trial court. In April 2007, Smith & Nephew PLLC acquired BlueSky and began commercializing NPWT products. Shortly thereafter, in May 2007, KCI and Wake Forest filed a patent infringement lawsuit against Smith & Nephew asserting patent infringement. In January 2009, Smith & Nephew launched a foam-based NPWT system at which point KCI and Wake Forest amended their claims against Smith & Nephew to assert additional patent claims. This case was tried by a jury in February 2010. Following the trial, the jury found that the patent claims asserted were not invalid and also found that Smith & Nephew was infringing the asserted patent claims. However, in October 2010, the Western District granted a motion for judgment as a matter of law filed by Smith & Nephew and entered an order invalidating the Wake Forest patent claims asserted in the case. This decision followed the revocations of the UK and German equivalents of the Wake Forest patents and was later followed by the revocation of the Australian equivalent. The litigation resulting in these revocations is detailed below. Wake Forest appealed this decision to the Federal Circuit.

On August 13, 2012, the Court of Appeals for the Federal Circuit reversed the judgment of the District Court in the Smith & Nephew litigation, and remanded the case for resolution of several outstanding motions. The Court of Appeals ruled that the trial court was bound by the jury's advisory verdict on the legal question of obviousness because there was sufficient evidence to support the factual questions that were posed to them. It did not construe any prior art or rule that the patent claims are valid as a matter of law; rather, it held that Smith & Nephew failed to carry its burden of persuasion. Smith & Nephew subsequently filed a motion for rehearing en banc at the Federal Circuit Court of Appeals, arguing that the trial court cannot be bound by the advisory verdict of the jury on obviousness, because obviousness is a question of law. At least four amicus briefs were filed, including one from the Federal Circuit Bar Association, in support of Smith & Nephew's position. On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed.

Wake Forest Litigation

Since at least 2009, a host of companies began offering NPWT systems, both gauze-based and foam-based, across the globe. None of these companies licensed the Wake Forest patents prior to commercializing their products. To the contrary, several succeeded in having the patents declared invalid. These proceedings are also detailed herein.

In light of the multiple rulings declaring the patents invalid, KCI reassessed the validity of the patents anddetermined that continued payment of the royalties scheduled under the 1993 license agreement with Wake Forest was inappropriate. KCI withdrew from the Smith & Nephew litigation and on February 28, 2011, filed suit in the Western District of Texas seeking a declaratory judgment that, among other things, KCI no longer owes royalties to Wake Forest because the relevant patent claims are invalid or not infringed. Historical royalties under the license agreement, although disputed, were accrued through February 27, 2011 and are reflected in our consolidated financial statements. For the year ended December 31, 2010, royalty payments accrued or paid to Wake Forest under the license agreement totaled approximately $86 million. No royalty payments have been made to Wake Forest since July, 2010.

On March 18, 2011, Wake Forest provided KCI with written notice of termination of the license agreement and filed suit in Forsyth County Superior Court, North Carolina, alleging breach of contract by KCI. In its termination notice, Wake Forest demanded that KCI cease manufacturing and selling licensed products. KCI subsequently removed that action from state court to the Federal District Court for the Middle District of North Carolina, after which Wake Forest amended its complaint to add allegations of patent infringement. KCI moved to have the North Carolina case transferred to the Western District of Texas, and on August 26, 2011, the case was transferred to the Western District, where it was consolidated with KCI's existing suit. The Western District case was stayed pending a decision by the Court of Appeals for the Federal Circuit in the Smith & Nephew litigation described above.

On November 1, 2012, Smith & Nephew announced it had reached a global settlement with Wake Forest to resolve all patent disputes between them related to NPWT. Following the settlement, the Federal Circuit appeal was dismissed, and the stay in the case between KCI and Wake Forest was lifted. The case has been set for trial in April 2014. In January and February of 2013, Wake Forest and KCI filed their respective answers and counterclaims against each other. KCI is alleging breach of contract against Wake Forest for its refusal to negotiate in good faith to reduce the royalty rate under the license agreement following the several patent invalidity rulings and subsequent loss of market share by KCI. Because of the multiple rulings declaring the patents invalid and the August 13, 2012 decision in the Smith & Nephew litigation does not construe any prior art or rule that the patent claims are valid as a matter of law, KCI's assessment that the Wake Forest patents are invalid or not infringed by KCI's products has not changed. We continue to vigorously defend our positions in the case and KCI will continue to manufacture and sell V.A.C.® Therapy products. It is not possible to predict the outcome of this litigation nor is it possible to estimate any damages that may be awarded if we are unsuccessful in the litigation. We believe that any damages awarded as a reasonable royalty in this case would be substantially less than our previous royalty obligation to Wake Forest because the prior license agreement provided KCI with worldwide exclusive rights, whereas any infringement damages in the case would be based on US non-exclusive rights. We also believe our counter-claims against Wake Forest could further reduce our potential exposure to a damages award in the event we are unsuccessful on the liability issues of the case.

Because KCI believes the Wake Forest patents are invalid, KCI has not continued to enforce the Wake Forest Patents against alleged infringers. Instead, KCI has withdrawn from each of the cases described below that involve the Wake Forest patents.

Other US Intellectual Property Litigation

In May 2007, contemporaneous with the filing of the lawsuit against Smith & Nephew which is detailed above, KCI and Wake Forest filed a case against Medela, for the manufacture, use and sale of NPWT products alleging infringement of the Wake Forest patents. Medela responded by alleging, among other things, that the Wake Forest patents are invalid. Following the October 2010 judgment invalidating the claims in the Wake Forest patents, the case against Medela was stayed. Because KCI believes the Wake Forest patents are invalid, KCI filed an unopposed motion to withdraw from the case, which was granted by the court in February 2013. On May 14, 2013, Wake Forest and Medela filed a stipulation of dismissal with prejudice following settlement of the disputes between them.

In January 2008, KCI and Wake Forest filed a patent infringement lawsuit against Innovative Therapies, Inc. (“ITI”) in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device introduced by ITI in 2007 infringed three Wake Forest patents. ITI responded by alleging, among other things, that the Wake Forest patents are invalid. Because KCI believes the Wake Forest patents are invalid, KCI filed a motion to dismiss its claims against ITI which the Court granted on August 30, 2013.

In December 2008, KCI, its affiliates and Wake Forest filed a patent infringement lawsuit against Boehringer Wound Systems, LLC, Boehringer Technologies, LP, and Convatec, Inc. in the U.S. District Court for the Middle District of North Carolina. The federal complaint alleged that a NPWT device manufactured by Boehringer and commercialized by Convatec infringed Wake Forest patents. In February 2009, the defendants filed their answer which includes affirmative defenses and counterclaims alleging non-infringement and invalidity of the Wake Forest patents. On June 3, 2013, the parties filed a stipulation of Dismissal with Prejudice.

In August 2013, Vital Needs International, L.P. ("Vital Needs") filed a Demand for Arbitration with the American Arbitration Association seeking to recover $100 million in damages against Kinetic Concepts, Inc. and KCI Licensing, Inc. based on a number of claims related to certain intellectual property rights sold by Vital Needs to KCI pursuant to an Acquisition Agreement dated June 2, 2006. Vital Needs alleges, among other things, breach of the Acquisition Agreement for failure to pay royalties on sales of KCI products. We do not believe any royalties are owed to Vital Needs for sales of KCI products, and we believe our defenses to Vital Needs' claims are meritorious. We intend to vigorously defend the arbitration, which is in its initial phase.

International Intellectual Property Litigation

In June 2007, Medela filed a patent nullity suit in the German Federal Patent Court against Wake Forest's German patent corresponding to European Patent No. EP0620720 (“the '720 Patent”). In March 2008 and February 2009, Mölnlycke Health Care AB and Smith & Nephew, respectively, joined the nullity suit against the '720 Patent. In March 2009, the German Federal Patent Court ruled that the claims of the '720 Patent were invalid and revoked the German patent corresponding to the '720 Patent. A hearing on Wake Forest's appeal, previously set for April 26, 2012 was postponed and reset for February 13, 2013. The nullity complaints were withdrawn the morning of the scheduled hearing pursuant to a settlement between Wake Forest and the nullity plaintiffs, and the hearing did not take place. Although the patent's statutory term expired in November 2012, the withdrawal of the nullity complaints resulted in a reinstatement of the '720 Patent in Germany. As a result, on July 10, 2013, KCI filed a separate suit to nullify the German part of the '720 Patent.

In March 2009, KCI and its affiliates and Wake Forest filed a patent infringement lawsuit asserting the Australian counterpart to the Wake Forest Patents against Smith & Nephew in the Federal Court of Australia, requesting preliminary injunctive relief to prohibit the commercialization of a Smith & Nephew negative pressure wound therapy dressing kit. A full trial on validity and infringement of the Wake Forest patent involved in the case was held in 2010. In September 2011, the Federal Court ruled the asserted claims to be invalid and not infringed by Smith & Nephew's product. Wake Forest appealed the decision and oral arguments were heard before the appellate court in May 2012. Following the settlement between Wake Forest and Smith & Nephew described above, the Federal Court dismissed the appeal on November 30, 2012 without addressing Wake Forest's appeal, and remitted the case to the lower court for costs and damages relating to the initial action filed in 2009. The dismissal renders the ruling of non-infringement and invalidity of the asserted claims final. The patent's statutory term expired in November 2012.

LifeCell Litigation

AlloDerm Cases

LifeCell Corporation is a party to approximately 330 lawsuits filed by individuals alleging personal injury and seeking monetary damages for failed hernia repair procedures using LifeCell Corporation's AlloDerm products. These cases have been consolidated for case management purposes in Middlesex County, New Jersey. The cases are in the early stages of litigation, and none have been set for trial. Although it is not possible to reliably predict the outcome of the litigation, we believe that our defenses to these claims are meritorious and we will defend against these suits vigorously. We have insurance that covers these claims and lawsuits. Recently, we resolved a dispute with our primary products liability carrier and these consolidated cases are being treated as a single occurrence and therefore do not require the exhaustion of a separate self-insured retention to trigger coverage. Based on our existing insurance coverage and our defenses to these cases, we do not expect them to have a material impact on our results of operations or our financial position. As these cases are in their early stages with much discovery still to be conducted, the plaintiffs have yet to set forth their alleged damages. As such, it is impossible for the Company to predict or estimate potential losses if our defenses to these cases are unsuccessful.

Repliform Cases

LifeCell Corporation has recently been named in approximately 80 lawsuits in Middlesex County, Massachusetts, but has been served with only 40 of the suits. In addition, LifeCell has been sued in State court in Delaware and Minnesota, as well as federal district court in Minneapolis and the Northern District of Texas. The cases were filed by individuals alleging personal injury and seeking monetary damages for failed gynecological procedures using products sold by Boston Scientific. The LifeCell cases in Middlesex County, Massachusetts were filed in the M Session of the Superior Court, which consists of a number of cases involving Boston Scientific synthetic mesh products. We do not believe LifeCell is a proper party to these lawsuits and are therefore seeking to dismiss these suits. In the event the suits are not dismissed we intend to defend these suits vigorously. We likewise intend to defend the non-Massachusettes cases vigorously. We have insurance that covers these claims and lawsuits.

LifeNet Health Case

On September 6, 2013, LifeNet Health ("LifeNet") filed suit against LifeCell Corporation in the United States District Court for the Eastern District of Virginia, Norfolk Division. LifeNet alleges that two LifeCell products, Strattice™ Reconstructive Tissue Matrix and AlloDerm®RTM Ready to Use, infringe LifeNet’s U.S. Patent No. 6,569,200 ("the ‘200 Patent"). LifeNet alleges that LifeCell has been aware of the ‘200 Patent and its infringement since 2009 and acted willfully in continuing to infringe the ‘200 Patent thereafter. LifeNet seeks monetary damages including treble damages for willful infringement, together with costs and prejudgment and post judgment interest as well as a finding that the case is exceptional and an award of costs and reasonable attorneys fees. LifeCell was served with the complaint on October 15, 2013 and intends to vigorously defend this case.

Other Litigation

In February 2009, KCI received a subpoena from the U.S. Department of Health and Human Services Office of Inspector General (“OIG”) seeking records regarding our billing practices under the local coverage policies of the four regional Durable Medical Equipment Medicare Administrative Contractors (“DME MACs”). KCI cooperated with the OIG's inquiry and provided substantial documentation to the OIG and the U.S. Attorneys' office in response to its request. The government's inquiry stemmed from the filing under seal of two qui tam actions against KCI on March 20, 2008 and September 29, 2008 by two former employees in the U.S. District Court, Central District of California, Western Division.  These cases are captioned United States of America, ex rel. Steven J. Hartpence v. Kinetic Concepts, Inc. et al ("Hartpence Matter") and United States of America, ex rel. Geraldine Godecke v. Kinetic Concepts, Inc., et al ("Godecke Matter"). The complaints contend that KCI violated the Federal False Claims Act by billing in a manner that was not consistent with the Local Coverage Determinations issued by the DME MACs and seek recovery of monetary damages. Following the completion of the government's review and its decision declining to intervene in such suits, the live pleadings were ordered unsealed on May 3, 2011.  After reviewing the allegations, KCI filed motions seeking the dismissal of the suits on multiple grounds.  On January 30, 2012, the Court granted KCI's motions dismissing all of the claims in the Hartpence Matter and dismissing all of the claims in the Godecke Matter with the exception of a retaliation claim, which has been stayed pending the appeal of the dismissed claims.  On February 27, 2012 and June 15, 2012, respectively, Hartpence and Godecke each filed a Notice of Appeal to the U.S. Court of Appeals for the Ninth Circuit seeking to reverse the dismissal of their claims by the trial court.  On December 11, 2012, KCI moved the Ninth Circuit to disqualify counsel in the Hartpence and Godecke matters from representing relators on appeal due to their possession and use of KCI's privileged documents.  The Ninth Circuit granted the parties agreed motion to stay the briefing of the merits of the appeals pending resolution of the disqualification motion and on February 25, 2013, remanded KCI's disqualification motion to the U.S. District Court for disposition. On May 20, 2013, the District Court granted KCI's disqualification motions and counsel for both Godecke and Hartpence were disqualified. On July 19, 2013 the Ninth Circuit Court of Appeals issued an Order requiring counsel for Godecke and Hartpence to withdraw from the appeals or show cause why they should not be disqualified. Godecke and Hartpence have retained new counsel to represent them on appeal. The Ninth Circuit has not issued a briefing schedule.

We are a party to several additional lawsuits arising in the ordinary course of our business. Additionally, the manufacturing and marketing of medical products necessarily entails an inherent risk of product liability claims. We maintain multiple layers of product liability insurance coverage and we believe these policies and the amounts of coverage are appropriate and adequate.

OTHER COMMITMENTS AND CONTINGENCIES

As a healthcare supplier, we are subject to extensive government regulation, including laws and regulations directed at ascertaining the appropriateness of reimbursement, preventing fraud and abuse and otherwise regulating reimbursement under various government programs. The marketing, billing, documenting and other practices are all subject to government oversight and review. To ensure compliance with Medicare and other regulations, regional carriers often conduct audits and request patient records and other documents to support claims submitted by us for payment of services rendered to customers.

We also are subject to routine pre-payment and post-payment audits of medical claims submitted to Medicare. These audits typically involve a review, by Medicare or its designated contractors and representatives, of documentation supporting the medical necessity of the therapy provided by us. While Medicare requires us to obtain a comprehensive physician order prior to providing products and services, we are not required to, and do not as a matter of practice require, or subsequently obtain, the underlying medical records supporting the information included in such claim. Following a Medicare request for supporting documentation, we are obligated to procure and submit the underlying medical records retained by various medical facilities and physicians. Obtaining these medical records in connection with a claims audit may be difficult or impossible and, in any event, all of these records are subject to further examination and dispute by an auditing authority. Under standard Medicare procedures, we are entitled to demonstrate the sufficiency of documentation and the establishment of medical necessity, and we have the right to appeal any adverse determinations. If a determination is made that our records or the patients' medical records are insufficient to meet medical necessity or Medicare reimbursement requirements for the claims subject to a pre-payment or post-payment audit, we could be subject to denial, recoupment or refund demands for claims submitted for Medicare reimbursement. In the event that an audit results in discrepancies in the records provided, Medicare may be entitled to extrapolate the results of the audit to make recoupment demands based on a wider population of claims than those examined in the audit.

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Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Unrealized investment gain, net of tax expense of $338 and $1,413 in 2013	$ 338		$ 1,413
Foreign currency translation adjustment, net of tax benefit (expense) of $(300) and $259 in 2013 and $(164) and $(438) in 2012	$ (300)	$ (164)	$ 259	$ (438)

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 362,919	$ 383,150
Accounts receivable, net	368,900	355,718
Inventories, net	149,986	139,850
Prepaid expenses and other	59,499	39,511
Total current assets	941,304	918,229
Net property, plant and equipment	312,555	388,482
Debt issuance costs, net	101,766	96,476
Deferred income taxes	21,866	20,003
Goodwill	3,207,575	3,479,775
Identifiable intangible assets, net	2,343,525	2,666,201
Other non-current assets	4,054	5,598
Total assets	6,932,645	7,574,764
Current liabilities:
Accounts payable	44,527	40,970
Accrued expenses and other	351,903	284,163
Current installments of long-term debt	24,101	23,383
Deferred income taxes	4,610	57,528
Total current liabilities	425,141	406,044
Long-term debt, net of current installments and discount	4,517,139	4,554,112
Non-current tax liabilities	46,461	44,465
Deferred income taxes	960,219	1,069,480
Other non-current liabilities	38,897	43,267
Total liabilities	5,987,857	6,117,368
Equity:
General partner’s capital	0	0
Limited partners’ capital	952,314	1,457,913
Accumulated other comprehensive loss, net	(7,526)	(517)
Total equity	944,788	1,457,396
Total liabilities and shareholders' equity	$ 6,932,645	$ 7,574,764

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Supplemental Balance Sheet Data - Inventories, Net (Details) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Inventory [Line Items]
Finished goods and tissue available for distribution	$ 100,873	$ 96,573
Goods and tissue in-process	9,325	12,421
Raw materials, supplies, parts and unprocessed tissue	66,033	45,993
Inventories, gross	176,231	154,987
Less: Amounts expected to be converted into equipment for short-term rental	(14,118)	(5,237)
Reserve for excess and obsolete inventory	(12,127)	(9,900)
Inventories, net	$ 149,986	$ 139,850

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Segment Information (Tables)

9 Months Ended

Sep. 30, 2013

Segment Reporting [Abstract]

Reconciliation of Revenue and Operating Earnings (Loss) from Segments to Consolidated

Information on segments and a reconciliation of consolidated totals are as follows (in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Revenue:
KCI	$	320,879		$	329,651		$	944,526		$	986,157
LifeCell	119,682			106,222			344,598			320,364
Total revenue	$	440,561		$	435,873		$	1,289,124		$	1,306,521
Operating earnings (loss):
KCI	$	126,837		$	114,833		$	327,018		$	277,191
LifeCell	30,093			28,864			91,159			75,503
Non-allocated costs:
General headquarter expense (1)	(6,335		)	(5,520		)	(59,447		)	(19,545		)
Equity-based compensation	(850		)	(197		)	(2,046		)	(1,186		)
Merger and restructuring-related expenses (2)	(31,112		)	(21,684		)	(97,518		)	(63,750		)
Acquired intangible asset amortization (3)	(45,099		)	(49,733		)	(138,969		)	(172,260		)
Impairment of goodwill and intangible assets (4)	(443,400		)	—			(443,400		)	—
Total non-allocated costs	(526,796		)	(77,134		)	(741,380		)	(256,741		)
Total operating earnings (loss)	$	(369,866	)	$	66,563		$	(323,203	)	$	95,953

_____________________________

(1) The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product.

(2) Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses.

(3) Includes amortization of acquired intangible assets related to our Merger in November 2011.

(4) During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Guarantor Condensed Consolidating Financial Statements - Condensed Consolidated Cash Flow (Details) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (505,923)	$ (181,124)
Adjustments to reconcile net earnings (loss) to net cash provided	641,418	366,999
Net cash provided (used) by operating activities	135,495	185,875
Cash flows from investing activities
Net additions to property, plant and equipment	(67,697)	(69,510)
Increase in identifiable intangible assets and other non-current assets	(4,273)	(5,380)
Net cash provided (used) by investing activities	(71,970)	(74,890)
Cash flows from financing activities:
Capital contributions from limited partners	0	239
Distribution to limited partners	(1,572)	(1,970)
Repayments of long-term debt and capital lease obligations	(60,429)	(17,483)
Payment of debt issuance costs	(21,604)	(578)
Proceeds (payments) on intercompany loans	0	0
Proceeds (payments) on intercompany investments	0	0
Net cash provided (used) by financing activities	(83,605)	(19,792)
Effect of exchange rate changes on cash and cash equivalents	(151)	308
Net increase (decrease) in cash and cash equivalents	(20,231)	91,501
Cash and cash equivalents, beginning of period	383,150	215,426
Cash and cash equivalents, end of period	362,919	306,927
Parent Company [Member]
Cash flows from operating activities:
Net loss	(505,923)	(181,124)
Adjustments to reconcile net earnings (loss) to net cash provided	3,619	3,154
Net cash provided (used) by operating activities	(502,304)	(177,970)
Cash flows from investing activities
Net additions to property, plant and equipment	0	0
Increase in identifiable intangible assets and other non-current assets	0	0
Net cash provided (used) by investing activities	0	0
Cash flows from financing activities:
Capital contributions from limited partners		239
Distribution to limited partners	(1,572)	(1,970)
Repayments of long-term debt and capital lease obligations	0	0
Payment of debt issuance costs	0	0
Proceeds (payments) on intercompany loans	0	0
Proceeds (payments) on intercompany investments	503,876	179,688
Net cash provided (used) by financing activities	502,304	177,957
Effect of exchange rate changes on cash and cash equivalents	0	0
Net increase (decrease) in cash and cash equivalents	0	(13)
Cash and cash equivalents, beginning of period	398	411
Cash and cash equivalents, end of period	398	398
Kinetic Concepts, Inc. and KCI USA, Inc. Borrower [Member]
Cash flows from operating activities:
Net loss	(106,411)	(336,763)
Adjustments to reconcile net earnings (loss) to net cash provided	249,757	439,770
Net cash provided (used) by operating activities	143,346	103,007
Cash flows from investing activities
Net additions to property, plant and equipment	(145,714)	(57,203)
Increase in identifiable intangible assets and other non-current assets	(70)	87
Net cash provided (used) by investing activities	(145,784)	(57,116)
Cash flows from financing activities:
Capital contributions from limited partners		0
Distribution to limited partners	0	0
Repayments of long-term debt and capital lease obligations	(60,446)	(17,508)
Payment of debt issuance costs	(21,604)	(578)
Proceeds (payments) on intercompany loans	51,298	(120,557)
Proceeds (payments) on intercompany investments	(104,808)	196,745
Net cash provided (used) by financing activities	(135,560)	58,102
Effect of exchange rate changes on cash and cash equivalents	0	0
Net increase (decrease) in cash and cash equivalents	(137,998)	103,993
Cash and cash equivalents, beginning of period	276,788	142,652
Cash and cash equivalents, end of period	138,790	246,645
Guarantor Subsidiaries [Member]
Cash flows from operating activities:
Net loss	(328,228)	(80,240)
Adjustments to reconcile net earnings (loss) to net cash provided	397,283	(123,522)
Net cash provided (used) by operating activities	69,055	(203,762)
Cash flows from investing activities
Net additions to property, plant and equipment	(14,556)	(42,323)
Increase in identifiable intangible assets and other non-current assets	(4,474)	(5,486)
Net cash provided (used) by investing activities	(19,030)	(47,809)
Cash flows from financing activities:
Capital contributions from limited partners		0
Distribution to limited partners	0	0
Repayments of long-term debt and capital lease obligations	0	0
Payment of debt issuance costs	0	0
Proceeds (payments) on intercompany loans	(53,452)	45,537
Proceeds (payments) on intercompany investments	3,427	206,034
Net cash provided (used) by financing activities	(50,025)	251,571
Effect of exchange rate changes on cash and cash equivalents	0	0
Net increase (decrease) in cash and cash equivalents	0	0
Cash and cash equivalents, beginning of period	0	0
Cash and cash equivalents, end of period	0	0
Non-Guarantor Subsidiaries [Member]
Cash flows from operating activities:
Net loss	(10,136)	(338,090)
Adjustments to reconcile net earnings (loss) to net cash provided	35,915	153,344
Net cash provided (used) by operating activities	25,779	(184,746)
Cash flows from investing activities
Net additions to property, plant and equipment	(98,591)	(39,328)
Increase in identifiable intangible assets and other non-current assets	271	19
Net cash provided (used) by investing activities	(98,320)	(39,309)
Cash flows from financing activities:
Capital contributions from limited partners		0
Distribution to limited partners	0	0
Repayments of long-term debt and capital lease obligations	17	25
Payment of debt issuance costs	0	0
Proceeds (payments) on intercompany loans	2,154	75,020
Proceeds (payments) on intercompany investments	188,288	136,223
Net cash provided (used) by financing activities	190,459	211,268
Effect of exchange rate changes on cash and cash equivalents	(151)	308
Net increase (decrease) in cash and cash equivalents	117,767	(12,479)
Cash and cash equivalents, beginning of period	105,964	72,363
Cash and cash equivalents, end of period	223,731	59,884
Eliminations [Member]
Cash flows from operating activities:
Net loss	444,775	755,093
Adjustments to reconcile net earnings (loss) to net cash provided	(45,156)	(105,747)
Net cash provided (used) by operating activities	399,619	649,346
Cash flows from investing activities
Net additions to property, plant and equipment	191,164	69,344
Increase in identifiable intangible assets and other non-current assets	0	0
Net cash provided (used) by investing activities	191,164	69,344
Cash flows from financing activities:
Capital contributions from limited partners		0
Distribution to limited partners	0	0
Repayments of long-term debt and capital lease obligations	0	0
Payment of debt issuance costs	0	0
Proceeds (payments) on intercompany loans	0	0
Proceeds (payments) on intercompany investments	(590,783)	(718,690)
Net cash provided (used) by financing activities	(590,783)	(718,690)
Effect of exchange rate changes on cash and cash equivalents	0	0
Net increase (decrease) in cash and cash equivalents	0	0
Cash and cash equivalents, beginning of period	0	0
Cash and cash equivalents, end of period	$ 0	$ 0

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Commitments and Contingencies (Details) (USD $)		12 Months Ended	39 Months Ended	1 Months Ended
	Aug. 01, 2013	Dec. 31, 2010 Wake Forest Royalty Litigation [Member]	Sep. 30, 2013 Wake Forest Royalty Litigation [Member]	Feb. 28, 2009 Billing Practices [Member] contractor employee	Sep. 30, 2013 Alloderm [Member] LifeCell Corporation [Member] Damages from Product Defects [Member] suit	Sep. 30, 2013 Repliform [Member] LifeCell Corporation [Member] Damages from Product Defects [Member] suit
Loss Contingencies [Line Items]
Royalty Expense		$ 86,000,000	$ 0
Demand for Arbitration, Requested Damages	$ 100,000,000
Number of pending lawsuits					330	80
Number of Regional Durable Medical Equipment Medicare Administrative Contractors Records Provided				4
Number of Former Employees That Filed Qui Tam Actions				2

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Segment Information (Details) (USD $)	3 Months Ended				9 Months Ended
	Sep. 30, 2013 segment		Sep. 30, 2012		Sep. 30, 2013 segment		Sep. 30, 2012
Segment Reporting Information [Line Items]
Number of reportable operating segments	2				2
Number of global business units	2				2
Total revenue	$ 440,561,000		$ 435,873,000		$ 1,289,124,000		$ 1,306,521,000
Operating earnings (loss)	(369,866,000)		66,563,000		(323,203,000)		95,953,000
Non-allocated costs:
General headquarter expense	(6,335,000)	[1]	(5,520,000)	[1]	(59,447,000)	[1]	(19,545,000)	[1]
Equity-based compensation	(850,000)		(197,000)		(2,046,000)		(1,186,000)
Merger and restructuring-related expenses	(31,112,000)	[2]	(21,684,000)	[2]	(97,518,000)	[2]	(63,750,000)	[2]
Acquired intangible asset amortization	(45,099,000)	[3]	(49,733,000)	[3]	(138,969,000)	[3]	(172,260,000)	[3]
Impairment of goodwill and intangible assets	(443,400,000)	[4]	0	[4]	(443,400,000)	[4]	0	[4]
Total non-allocated costs	(526,796,000)		(77,134,000)		(741,380,000)		(256,741,000)
Write-off of other intangible assets	3,500,000				16,885,000		0
Fixed asset and inventory impairment			9,700,000		30,259,000		22,116,000
KCI [Member]
Segment Reporting Information [Line Items]
Total revenue	320,879,000		329,651,000		944,526,000		986,157,000
Operating earnings (loss)	126,837,000		114,833,000		327,018,000		277,191,000
LifeCell Corporation [Member]
Segment Reporting Information [Line Items]
Total revenue	119,682,000		106,222,000		344,598,000		320,364,000
Operating earnings (loss)	30,093,000		28,864,000		91,159,000		75,503,000
Non-allocated costs:
Goodwill, Impairment Loss					272,200,000
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill)					$ 171,200,000
Minimum [Member]
Segment Reporting Information [Line Items]
Minimum number of countries in which the entity has operations	25				25

[1] The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product.

[2] Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses.

[3] Includes amortization of acquired intangible assets related to our Merger in November 2011.

[4] During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2013

Other Comprehensive Income [Abstract]

Comprehensive Income (Loss) Note

Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss are as follows (in thousands):

	Accumulated Foreign Currency Translation Adjustment			Investment Gain		Accumulated Other Comprehensive Income (Loss)
Balances at December 31, 2012	$	(517	)	$	—	$	(517	)
Unrealized investment gain, net of tax expense of $1,413	—			2,257		2,257
Foreign currency translation adjustment, net of tax benefit of $259	(9,266		)	—		(9,266		)
Balances at September 30, 2013	$	(9,783	)	$	2,257	$	(7,526	)

During the nine months ended September 30, 2013, there were no reclassification adjustments out of accumulated other comprehensive loss to net loss.

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Long-Term Debt (Details) (USD $)	1 Months Ended	3 Months Ended	9 Months Ended			9 Months Ended													9 Months Ended
	Mar. 15, 2013	Feb. 04, 2013	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012	Sep. 30, 2013 Revolving Credit Facility [Member] Senior Revolving Credit Facility - due 2016 [Member]	Dec. 31, 2012 Revolving Credit Facility [Member] Senior Revolving Credit Facility - due 2016 [Member]	Nov. 30, 2011 Revolving Credit Facility [Member] Senior Revolving Credit Facility - due 2016 [Member]	Sep. 30, 2013 Term Credit Facilities [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]	Dec. 31, 2012 Term Credit Facilities [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Term Credit Facilities [Member] Senior Euro Term D-1 Credit Facility Due 2018 [Member]	Dec. 31, 2012 Term Credit Facilities [Member] Senior Euro Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Term Credit Facilities [Member] Senior Term D-2 Credit Facility Due 2016 [Member]	Dec. 31, 2012 Term Credit Facilities [Member] Senior Term D-2 Credit Facility Due 2016 [Member]	Sep. 30, 2013 Convertible Senior Notes [Member] 3.25% Convertible Senior Notes due 2015 [Member]	Dec. 31, 2012 Convertible Senior Notes [Member] 3.25% Convertible Senior Notes due 2015 [Member]	Sep. 30, 2013 Senior Secured Notes [Member] 10.5% Second Lien Senior Secured Notes due 2018 [Member]	Dec. 31, 2012 Senior Secured Notes [Member] 10.5% Second Lien Senior Secured Notes due 2018 [Member]	Sep. 30, 2013 Senior Unsecured Notes [Member] 12.5% Senior Unsecured Notes due 2019 [Member]	Dec. 31, 2012 Senior Unsecured Notes [Member] 12.5% Senior Unsecured Notes due 2019 [Member]	Sep. 30, 2013 IBM Financing [Member]	Dec. 31, 2012 IBM Financing [Member]	Sep. 30, 2013 Banks Which Are Not Party To Senior Secured Credit Facility [Member] Senior Revolving Credit Facility - due 2016 [Member]	Dec. 31, 2012 Banks Which Are Not Party To Senior Secured Credit Facility [Member] Senior Revolving Credit Facility - due 2016 [Member]	Sep. 30, 2013 Eurocurrency Rate [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Eurocurrency Rate [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member] Minimum [Member]	Sep. 30, 2013 Eurocurrency Rate [Member] Senior Euro Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Eurocurrency Rate [Member] Senior Term D-2 Credit Facility Due 2016 [Member]	Sep. 30, 2013 Base Rate [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Base Rate [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member] Minimum [Member]	Sep. 30, 2013 Base Rate [Member] Senior Euro Term D-1 Credit Facility Due 2018 [Member]	Sep. 30, 2013 Base Rate [Member] Senior Term D-2 Credit Facility Due 2016 [Member]	Jul. 30, 2013 Systagenix [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]	Jul. 30, 2013 Systagenix [Member] Term Credit Facilities [Member] Senior Dollar Term D-1 Credit Facility Due 2018 [Member]
Debt Instrument [Line Items]
Long-term debt, gross			$ 4,617,504,000		$ 4,663,173,000				$ 1,601,607,000	$ 1,613,700,000	$ 332,186,000	$ 327,022,000	$ 319,339,000	$ 321,750,000	$ 101,000	$ 701,000	$ 1,750,000,000	$ 1,750,000,000	$ 612,000,000	$ 650,000,000	$ 2,271,000	$ 0
Less: Discount, net of accretion			(76,264,000)		(85,678,000)				(32,100,000)	(33,840,000)	(11,033,000)	(13,353,000)	(4,860,000)	(7,064,000)			(25,160,000)	(27,827,000)	(3,111,000)	(3,594,000)														400,000
Long-term Debt			4,541,240,000		4,577,495,000
Less: Current installments			(24,101,000)		(23,383,000)
Long-term debt, net of current installments and discount			4,517,139,000		4,554,112,000
Senior Secured Credit Facilities [Abstract]
Credit facility, maximum borrowing capacity								200,000,000
Line of Credit Facility, Amount Outstanding						0	0
Letters of credit, amount outstanding						10,700,000	11,500,000																3,500,000	4,600,000
Credit facility, remaining borrowing capacity						189,300,000	188,500,000
Credit facility, unused capacity, commitment fee percentage						0.375%
Business Acquisition, Incremental Borrowing																																	350,000,000
Debt Instrument, Basis Spread on Variable Rate																									3.50%	1.00%	3.75%	3.00%	2.50%	2.00%	2.75%	2.00%
10.5% Second Lien Senior Secured Notes and 12.5% Senior Unsecured Notes [Abstract]
Interest rate on senior long-term debt															3.25%		10.50%		12.50%
Debt Instument, Registration Rights Agreement, Additional Interest Accrual Rate	0.50%	0.25%
Repayments Of Long Term Debt Revolving Credit Facility And Capital Lease Obligations			$ 60,429,000	$ 17,483,000															$ 38,000,000

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Guarantor Condensed Consolidating Financial Statements

9 Months Ended

Sep. 30, 2013

Guarantor Condensed Consolidating Financial Statements [Abstract]

Guarantor Condensed Consolidating Financial Statements

Guarantor Condensed Consolidating Financial Statements

Our 10.5% Second Lien Notes and 12.5% Unsecured Notes are fully and unconditionally guaranteed, jointly and severally, by us and each of our material 100% owned subsidiaries, other than the subsidiaries that are co-issuers of the notes, foreign subsidiaries and subsidiaries whose only assets are investments in foreign subsidiaries. The non-guarantor subsidiaries do not have any payment obligations under the 10.5% Second Lien Notes or 12.5% Unsecured Notes. Subject to the terms of the10.5% Second Lien Notes and 12.5% Unsecured Notes indentures, the guarantee of a subsidiary guarantor will terminate upon:

(1) a sale or other disposition (including by way of consolidation or merger) of the capital stock of such guarantor or the sale or disposition of all or substantially all the assets of such subsidiary guarantor (other than to the Company or a restricted subsidiary) otherwise permitted by the 10.5% Second Lien Notes or 12.5% Unsecured Notes indentures,

(2) the designation in accordance with the10.5% Second Lien Notes or 12.5% Unsecured Notes indenture of the guarantor as an unrestricted subsidiary or the occurrence of any event after which the guarantor is no longer a restricted subsidiary,

(3) defeasance or discharge of the10.5% Second Lien Notes or 12.5% Unsecured Notes, or

(4) upon the achievement of investment grade status by the10.5% Second Lien Notes or 12.5% Unsecured Notes; provided that such guarantee shall be reinstated upon the reversion date.

In the event of a bankruptcy, liquidation or reorganization of any non-guarantor subsidiary, such non-guarantor subsidiary will pay the holders of its debt and other liabilities, including its trade creditors, before it will be able to distribute any of its assets to us. In the future, any non-U.S. subsidiaries, immaterial subsidiaries and subsidiaries that we designate as unrestricted subsidiaries under the 10.5% Second Lien Notes and 12.5% Unsecured Notes indentures will not guarantee the 10.5% Second Lien Notes or 12.5% Unsecured Notes. As of September 30, 2013, there were no restrictions on the ability of subsidiary guarantors to transfer funds to the parent company.

As a result of the guarantee arrangements, we are presenting the following condensed consolidated balance sheets, statements of operations and comprehensive income (loss), and statements of cash flows of the issuer, the guarantor subsidiaries and the non-guarantor subsidiaries.

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

September 30, 2013

(in thousands)

(unaudited)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	138,790		$	—	$	223,731		$	—		$	362,919
Accounts receivable, net	—		184,370			73,382		111,148			—			368,900
Inventories, net	—		63,219			92,060		78,178			(83,471		)	149,986
Prepaid expenses and other	—		41,376			5,913		342,209			(329,999		)	59,499
Intercompany receivables	166		1,400,317			2,270,890		149,321			(3,820,694		)	—
Total current assets	564		1,828,072			2,442,245		904,587			(4,234,164		)	941,304
Net property, plant and equipment	—		297,648			82,391		197,071			(264,555		)	312,555
Debt issuance costs, net	—		101,766			—		—			—			101,766
Deferred income taxes	—		—			—		21,866			—			21,866
Goodwill	—		2,483,240			724,335		—			—			3,207,575
Identifiable intangible assets, net	—		380,314			1,809,207		154,004			—			2,343,525
Other non-current assets	—		424			186		94,344			(90,900		)	4,054
Intercompany loan receivables	—		785,000			404,586		—			(1,189,586		)	—
Intercompany investments	948,376		406,067			406,253		—			(1,760,696		)	—
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	16,089		$	12,540	$	15,898		$	—		$	44,527
Accrued expenses and other	—		234,359			238,528		61,948			(182,932		)	351,903
Intercompany payables	3,934		788,613			2,508,621		519,526			(3,820,694		)	—
Current installments of long-term debt	—		22,760			1,341		—			—			24,101
Income taxes payable	—		1,495			—		(1,495		)	—			—
Deferred income taxes	—		(34,267		)	42,519		(3,642		)	—			4,610
Total current liabilities	3,934		1,029,049			2,803,549		592,235			(4,003,626		)	425,141
Long-term debt, net of current installments and discount	—		4,516,223			916		—			—			4,517,139
Non-current tax liabilities	—		42,084			—		4,377			—			46,461
Deferred income taxes	—		56,892			852,886		50,441			—			960,219
Other non-current liabilities	218		37,242			298		1,139			—			38,897
Intercompany loan payables	—		402,433			785,000		2,153			(1,189,586		)	—
Total liabilities	4,152		6,083,923			4,442,649		650,345			(5,193,212		)	5,987,857
Total equity	944,788		198,608			1,426,554		721,527			(2,346,689		)	944,788
	$	948,940	$	6,282,531		$	5,869,203	$	1,371,872		$	(7,539,901	)	$	6,932,645

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Balance Sheet

December 31, 2012

(in thousands)

	Centaur Guernsey L.P. Inc. Parent Company		Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets:
Current assets:
Cash and cash equivalents	$	398	$	276,788		$	—	$	105,964	$	—		$	383,150
Accounts receivable, net	—		174,534			58,244		122,940		—			355,718
Inventories, net	—		94,345			71,676		60,635		(86,806		)	139,850
Deferred income taxes	—		38,451			—		3,642		(42,093		)	—
Prepaid expenses and other	—		25,083			6,591		294,437		(286,600		)	39,511
Intercompany receivables	166		1,337,915			2,149,981		147,473		(3,635,535		)	—
Total current assets	564		1,947,116			2,286,492		735,091		(4,051,034		)	918,229
Net property, plant and equipment	—		281,950			79,049		190,419		(162,936		)	388,482
Debt issuance costs, net	—		96,476			—		—		—			96,476
Deferred income taxes	—		—			—		20,003		—			20,003
Goodwill	—		2,483,240			996,535		—		—			3,479,775
Identifiable intangible assets, net	—		441,620			2,045,091		179,490		—			2,666,201
Other non-current assets	—		324			186		95,988		(90,900		)	5,598
Intercompany loan receivables	—		800,000			366,134		—		(1,166,134		)	—
Intercompany investments	1,459,261		302,027			409,702		—		(2,170,990		)	—
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764
Liabilities and Equity:
Current liabilities:
Accounts payable	$	—	$	17,869		$	13,093	$	10,008	$	—		$	40,970
Accrued expenses and other	—		172,356			236,838		62,226		(187,257		)	284,163
Intercompany payables	2,361		723,096			2,389,863		520,215		(3,635,535		)	—
Current installments of long-term debt	—		23,383			—		—		—			23,383
Income taxes payable	—		(1,452		)	—		1,452		—			—
Deferred income taxes	—		—			99,621		—		(42,093		)	57,528
Total current liabilities	2,361		935,252			2,739,415		593,901		(3,864,885		)	406,044
Long-term debt, net of current installments and discount	—		4,554,112			—		—		—			4,554,112
Non-current tax liabilities	—		36,711			—		7,754		—			44,465
Deferred income taxes	—		115,652			888,597		65,231		—			1,069,480
Other non-current liabilities	68		41,360			375		1,464		—			43,267
Intercompany loan payables	—		366,135			800,000		—		(1,166,135		)	—
Total liabilities	2,429		6,049,222			4,428,387		668,350		(5,031,020		)	6,117,368
Total equity	1,457,396		303,531			1,754,802		552,641		(2,610,974		)	1,457,396
	$	1,459,825	$	6,352,753		$	6,183,189	$	1,220,991	$	(7,641,994	)	$	7,574,764

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	155,893		$	1,513		$	33,635		$	—		$	191,041
Sales	—			77,659			224,426			159,142			(211,707		)	249,520
Total revenue	—			233,552			225,939			192,777			(211,707		)	440,561
Rental expenses	—			62,928			4,010			53,891			(35,083		)	85,746
Cost of sales	30			123,481			142,946			57,512			(257,818		)	66,151
Gross profit (loss)	(30		)	47,143			78,983			81,374			81,194			288,664
Selling, general and administrative expenses	820			66,834			44,169			40,261			(31		)	152,053
Research and development expenses	—			8,010			6,742			3,209			—			17,961
Acquired intangible asset amortization	—			19,625			17,907			7,584			—			45,116
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(850		)	(47,326		)	(433,235		)	30,320			81,225			(369,866		)
Non-operating intercompany transactions	—			(8,076		)	49,735			(60,212		)	18,553			—
Interest income and other	—			17,852			3,062			97			(20,794		)	217
Interest expense	—			(104,402		)	(17,756		)	(34		)	20,794			(101,398		)
Loss on extinguishment of debt	—			(200		)	—			—			—			(200		)
Foreign currency gain (loss)	—			(14,433		)	(38		)	5,733			—			(8,738		)
Derivative instruments loss	—			(6,840		)	—			—			—			(6,840		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(850		)	(163,425		)	(398,232		)	(24,096		)	99,778			(486,825		)
Income tax expense (benefit)	—			(51,104		)	(34,535		)	(2,880		)	—			(88,519		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(850		)	(112,321		)	(363,697		)	(21,216		)	99,778			(398,306		)
Equity in earnings (loss) of subsidiaries	(397,711		)	48,780			(20,950		)	—			369,881			—
Earnings (loss) from continuing operations	(398,561		)	(63,541		)	(384,647		)	(21,216		)	469,659			(398,306		)
Earnings (loss) from discontinued operations, net of tax	—			(331		)	(1		)	266			(189		)	(255		)
Net earnings (loss)	$	(398,561	)	$	(63,872	)	$	(384,648	)	$	(20,950	)	$	469,470		$	(398,561	)
Total comprehensive income (loss)	$	(403,151	)	$	(68,462	)	$	(389,238	)	$	(25,540	)	$	483,240		$	(403,151	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the three months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	164,641		$	1,741		$	40,774		$	—		$	207,156
Sales	—			74,943			103,716			151,225			(101,167		)	228,717
Total revenue	—			239,584			105,457			191,999			(101,167		)	435,873
Rental expenses	—			62,877			1,526			61,744			(25,337		)	100,810
Cost of sales	18			89,027			34,023			58,201			(122,656		)	58,613
Gross profit (loss)	(18		)	87,680			69,908			72,054			46,826			276,450
Selling, general and administrative expenses	191			75,731			32,926			33,978			(48		)	142,778
Research and development expenses	—			6,268			8,977			2,131			—			17,376
Acquired intangible asset amortization	—			22,308			18,687			8,738			—			49,733
Operating earnings (loss)	(209		)	(16,627		)	9,318			27,207			46,874			66,563
Non-operating intercompany transactions	—			5,318			132,861			(131,367		)	(6,812		)	—
Interest income and other	—			18,532			3,063			18			(21,439		)	174
Interest expense	—			(120,964		)	(18,375		)	(20		)	21,439			(117,920		)
Foreign currency gain (loss)	—			(6,651		)	170			1,223			—			(5,258		)
Derivative instruments loss	—			(8,579		)	—			—			—			(8,579		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(209		)	(128,971		)	127,037			(102,939		)	40,062			(65,020		)
Income tax expense (benefit)	—			(22,700		)	14,055			(18,531		)	—			(27,176		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(209		)	(106,271		)	112,982			(84,408		)	40,062			(37,844		)
Equity in earnings (loss) of subsidiaries	(35,603		)	28,741			(83,578		)	—			90,440			—
Earnings (loss) from continuing operations	(35,812		)	(77,530		)	29,404			(84,408		)	130,502			(37,844		)
Earnings (loss) from discontinued operations, net of tax	—			(1,468		)	627			830			2,043			2,032
Net earnings (loss)	$	(35,812	)	$	(78,998	)	$	30,031		$	(83,578	)	$	132,545		$	(35,812	)
Total comprehensive income (loss)	$	(34,215	)	$	(77,401	)	$	31,628		$	(81,981	)	$	127,754		$	(34,215	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	461,605		$	4,766		$	103,078		$	—		$	569,449
Sales	—			221,296			640,681			481,490			(623,792		)	719,675
Total revenue	—			682,901			645,447			584,568			(623,792		)	1,289,124
Rental expenses	13			186,426			12,180			167,226			(92,366		)	273,479
Cost of sales	84			221,212			396,855			177,420			(613,864		)	181,707
Gross profit (loss)	(97		)	275,263			236,412			239,922			82,438			833,938
Selling, general and administrative expenses	1,949			269,490			136,734			110,515			(210		)	518,478
Research and development expenses	—			23,366			23,263			9,511			—			56,140
Acquired intangible asset amortization	—			61,276			54,274			23,573			—			139,123
Impairment of goodwill and intangible assets	—			—			443,400			—			—			443,400
Operating earnings (loss)	(2,046		)	(78,869		)	(421,259		)	96,323			82,648			(323,203		)
Non-operating intercompany transactions	—			52,176			108,489			(112,565		)	(48,100		)	—
Interest income and other	—			54,046			9,188			166			(62,121		)	1,279
Interest expense	—			(324,163		)	(52,974		)	(128		)	62,121			(315,144		)
Loss on extinguishment of debt	—			(2,364		)	—			—			—			(2,364		)
Foreign currency gain (loss)	—			(8,953		)	(251		)	(2,731		)	—			(11,935		)
Derivative instruments gain	—			3,200			—			—			—			3,200
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(2,046		)	(304,927		)	(356,807		)	(18,935		)	34,548			(648,167		)
Income tax expense (benefit)	—			(97,201		)	(38,718		)	(8,624		)	—			(144,543		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(2,046		)	(207,726		)	(318,089		)	(10,311		)	34,548			(503,624		)
Equity in earnings (loss) of subsidiaries	(503,877		)	104,040			(10,136		)	—			409,973			—
Earnings (loss) from continuing operations	(505,923		)	(103,686		)	(328,225		)	(10,311		)	444,521			(503,624		)
Loss from discontinued operations, net of tax	—			(2,725		)	(3		)	175			254			(2,299		)
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Total comprehensive income (loss)	$	(512,932	)	$	(113,420	)	$	(335,237	)	$	(17,145	)	$	465,802		$	(512,932	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Operations and Comprehensive Income (Loss)

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Revenue:
Rental	$	—		$	495,299		$	4,507		$	122,544		$	—		$	622,350
Sales	—			218,950			312,106			388,453			(235,338		)	684,171
Total revenue	—			714,249			316,613			510,997			(235,338		)	1,306,521
Rental expenses	2			227,119			4,088			201,240			(84,062		)	348,387
Cost of sales	54			196,056			108,774			174,747			(289,177		)	190,454
Gross profit (loss)	(56		)	291,074			203,751			135,010			137,901			767,680
Selling, general and administrative expenses	1,142			244,705			96,903			103,765			(734		)	445,781
Research and development expenses	—			20,222			26,676			6,788			—			53,686
Acquired intangible asset amortization	—			81,085			59,273			31,902			—			172,260
Operating earnings (loss)	(1,198		)	(54,938		)	20,899			(7,445		)	138,635			95,953
Non-operating intercompany transactions	—			71,692			261,173			(352,936		)	20,071			—
Interest income and other	—			55,260			9,188			100			(63,918		)	630
Interest expense	—			(362,215		)	(54,725		)	(85		)	63,918			(353,107		)
Foreign currency gain (loss)	—			2,470			318			(2,360		)	—			428
Derivative instruments gain (loss)	—			(28,473		)	—			—			—			(28,473		)
Earnings (loss) from continuing operations before income taxes (benefit) and equity in earnings (loss) of subsidiaries	(1,198		)	(316,204		)	236,853			(362,726		)	158,706			(284,569		)
Income tax expense (benefit)	—			(61,959		)	(16,897		)	(28,269		)	—			(107,125		)
Earnings (loss) from continuing operations before equity in earnings (loss) of subsidiaries	(1,198		)	(254,245		)	253,750			(334,457		)	158,706			(177,444		)
Equity in earnings (loss) of subsidiaries	(179,926		)	(73,757		)	(338,090		)	—			591,773			—
Earnings (loss) from continuing operations	(181,124		)	(328,002		)	(84,340		)	(334,457		)	750,479			(177,444		)
Earnings (loss) from discontinued operations, net of tax	—			(8,761		)	4,100			(3,633		)	4,614			(3,680		)
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Total comprehensive income (loss)	$	(182,711	)	$	(338,350	)	$	(81,827	)	$	(339,677	)	$	759,854		$	(182,711	)

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2013
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(505,923	)	$	(106,411	)	$	(328,228	)	$	(10,136	)	$	444,775		$	(505,923	)
Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities	3,619			249,757			397,283			35,915			(45,156		)	641,418
Net cash provided (used) by operating activities	(502,304		)	143,346			69,055			25,779			399,619			135,495
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(145,714		)	(14,556		)	(98,591		)	191,164			(67,697		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			(70		)	(4,474		)	271			—			(4,273		)
Net cash provided (used) by investing activities	—			(145,784		)	(19,030		)	(98,320		)	191,164			(71,970		)
Cash flows from financing activities:
Distribution to limited partners	(1,572		)	—			—			—			—			(1,572		)
Repayments of long-term debt and capital lease obligations	—			(60,446		)	—			17			—			(60,429		)
Payment of debt issuance costs	—			(21,604		)	—			—			—			(21,604		)
Proceeds (payments) on intercompany loans	—			51,298			(53,452		)	2,154			—			—
Proceeds (payments) on intercompany investments	503,876			(104,808		)	3,427			188,288			(590,783		)	—
Net cash provided (used) by financing activities	502,304			(135,560		)	(50,025		)	190,459			(590,783		)	(83,605		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(151		)	—			(151		)
Net increase (decrease) in cash and cash equivalents	—			(137,998		)	—			117,767			—			(20,231		)
Cash and cash equivalents, beginning of period	398			276,788			—			105,964			—			383,150
Cash and cash equivalents, end of period	$	398		$	138,790		$	—		$	223,731		$	—		$	362,919

Condensed Consolidating Parent Company, Co-Issuers,

Guarantor and Non-Guarantor Statement of Cash Flows

(in thousands)

(unaudited)

	For the nine months ended September 30, 2012
	Centaur Guernsey L.P. Inc. Parent Company			Kinetic Concepts, Inc. and KCI USA, Inc. Borrower			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	(181,124	)	$	(336,763	)	$	(80,240	)	$	(338,090	)	$	755,093		$	(181,124	)
Adjustments to reconcile net loss to net cash provided (used) by operating activities	3,154			439,770			(123,522		)	153,344			(105,747		)	366,999
Net cash provided (used) by operating activities	(177,970		)	103,007			(203,762		)	(184,746		)	649,346			185,875
Cash flows from investing activities:
Net additions to property, plant and equipment	—			(57,203		)	(42,323		)	(39,328		)	69,344			(69,510		)
Decrease (increase) in identifiable intangible assets and other non-current assets	—			87			(5,486		)	19			—			(5,380		)
Net cash provided (used) by investing activities	—			(57,116		)	(47,809		)	(39,309		)	69,344			(74,890		)
Cash flows from financing activities:
Capital contributions from limited partners	239			—			—			—			—			239
Distribution to limited partners	(1,970		)	—			—			—			—			(1,970		)
Repayments of long-term debt and capital lease obligations	—			(17,508		)	—			25			—			(17,483		)
Proceeds (payments) on intercompany loans	—			(120,557		)	45,537			75,020			—			—
Payment of debt issuance costs	—			(578		)	—			—			—			(578		)
Proceeds (payments) on intercompany investments	179,688			196,745			206,034			136,223			(718,690		)	—
Net cash provided (used) by financing activities	177,957			58,102			251,571			211,268			(718,690		)	(19,792		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			308			—			308
Net increase (decrease) in cash and cash equivalents	(13		)	103,993			—			(12,479		)	—			91,501
Cash and cash equivalents, beginning of period	411			142,652			—			72,363			—			215,426
Cash and cash equivalents, end of period	$	398		$	246,645		$	—		$	59,884		$	—		$	306,927

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Derivative Financial Instruments and Fair Value Measurements

9 Months Ended

Sep. 30, 2013

Derivative Financial Instruments and Fair Value Measurements Disclosure [Abstract]

Derivative Financial Instruments and Fair Value Measurements

 Derivative Financial Instruments and Fair Value Measurements

We are exposed to credit loss in the event of nonperformance by counterparties to the extent of the fair values of the outstanding interest rate swap agreements, interest rate cap agreements and foreign currency exchange contracts, but we do not anticipate nonperformance by any of the counterparties. All derivative instruments are recorded on the balance sheets at fair value. We do not use financial instruments for speculative or trading purposes.

Interest Rate Protection

At September 30, 2013 and December 31, 2012, we had three interest rate swap agreements to convert a portion of our outstanding variable rate debt to a fixed rate basis. These agreements become effective in December 2013, have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. The interest rate swap agreements have quarterly interest payments, receive rates based on the higher of three-month USD LIBOR or 1.25% and pay rates based on fixed rates, due on the last day of March, June, September and December. Once effective, the aggregate notional amount decreases quarterly by amounts ranging from $1.7 million to $56.4 million until maturity.

The following table summarizes our interest rate swap agreements (dollars in thousands):

Effective Dates	Original Notional Amount	Fixed Interest Rate
12/31/13-12/31/16	$512,633	2.256%
12/31/13-12/31/16	$512,633	2.249%
12/31/13-12/31/16	$512,633	2.250%

As of September 30, 2013 and December 31, 2012, we had interest rate cap agreements with initial notional amounts of $1.6 billion at a cost of $2.2 million that effectively limited the eurocurrency interest rate to 2% on a portion of the borrowings under our Senior Secured Credit Facility. The interest rate cap agreements expire on December 31, 2013.

Foreign Currency Exchange Rate Mitigation

At September 30, 2013 and December 31, 2012, we had foreign currency exchange contracts to sell or purchase $34.8 million and $59.1 million, respectively, of various currencies.

Fair Value Measurements

The Codification definesfair value as the exit price that would be received to sell an asset or paid to transfer a liability. The Fair Value Measurements and Disclosure topic of the Codification establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amount reported in the balance sheets for cash and cash equivalents, accounts receivable, accounts payable and long-term obligations, excluding our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt, including the 10.5% Second Lien Secured Notes, the 12.5% Unsecured Notes and the Convertible Notes approximates fair value. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.6 billion, respectively, at September 30, 2013. The fair value of our borrowings under our Senior Secured Credit Facility and fixed rate long-term debt was $2.3 billion and $2.4 billion, respectively, at December 31, 2012. The fair value of our long-term debt was estimated based upon open-market trades at or near year end.

All of our derivatives, as of the reporting date, use inputs considered as Level 2. The interest rate swap agreements and interest rate cap agreements are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing interest rates and related forward interest rate curves. The foreign currency exchange contracts are valued using a discounted cash flow model that takes into account the present value of the future cash flows under the terms of the agreements by using market information available as of the reporting date, including prevailing foreign currency exchange rates and related foreign currency exchange rate curves.

The following table sets forth the location and aggregate fair value amounts of all derivative instruments with credit-related contingent features (in thousands):

	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	Fair Value				Balance Sheet Location	Fair Value
		September 30, 2013		December 31, 2012			September 30, 2013		December 31, 2012
Derivatives not designated as hedging instruments
Interest rate swap agreements	Prepaid expenses and other	$	—	$	—	Accrued expenses and other	$	330	$	—
Interest rate swap agreements	Other non-current assets	—		—		Other non-current liabilities	30,482		34,868
Interest rate cap agreements	Prepaid expenses and other	—		9		Accrued expenses and other	—		—
Foreign currency exchange contracts	Prepaid expenses and other	230		520		Accrued expenses and other	1,008		2,980
Total derivatives		$	230	$	529		$	31,820	$	37,848

The following table summarizes the amount of gain (loss) on derivatives not designated as hedging instruments (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Interest rate swap agreements	$	(5,195	)	$	(6,313	)	$	4,057		$	(24,610	)
Interest rate cap agreements	(4		)	(118		)	(9		)	(1,563		)
Foreign currency exchange contracts	(1,641		)	(2,148		)	(848		)	(2,300		)
	$	(6,840	)	$	(8,579	)	$	3,200		$	(28,473	)

Certain of our derivative instruments contain provisions that require compliance with the restrictive covenants of our Senior Secured Credit Facility. For further information regarding the restrictive covenants of credit facilities, see Note 6 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

If we default under our credit facilities, the lenders could require immediate repayment of the entire principal. If those lenders require immediate repayment, we may not be able to repay them which could result in the foreclosure of substantially all of our assets. In these circumstances, the counterparties to the derivative instruments could request immediate payment or full collateralization on derivative instruments in net liability positions. Certain of our derivative counterparties are also parties to our Senior Secured Credit Facility.

No collateral has been posted by us in the normal course of business. If the credit-related contingent features underlying these agreements were triggered on September 30, 2013, we could be required to settle or post the full amount as collateral to the respective agreement counterparties.

We did not have any measurements of financial assets or financial liabilities at fair value on a nonrecurring basis at September 30, 2013 or December 31, 2012.

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Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

(a)Basis of Presentation and Principles of Consolidation

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP” or “the Codification”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information necessary for a fair presentation of results of operations, financial position and cash flows in conformity with GAAP. Operating results from interim periods are not necessarily indicative of results that may be expected for the fiscal year as a whole. The condensed consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of our results for the interim periods presented. Certain prior period amounts have been reclassified to conform to the 2013 presentation.

On August 15, 2012, KCI announced that it had entered into an asset purchase agreement with Getinge for the sale of KCI's Therapeutic Support Systems ("TSS") business (the “Agreement”). The transaction closed on November 8, 2012. The final adjusted purchase price paid by Getinge to KCI was $241.5 million. Under the terms of the Agreement, we agreed to provide transition services to Getinge after the close of the transaction. In accordance with the Codification, depreciation and amortization of the long-lived assets subject to the Agreement ceased as of August 15, 2012. Additionally, the results of the operations subject to the Agreement, excluding the allocation of general corporate overhead, are presented as discontinued operations in the condensed consolidated statements of operations for all periods presented. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

The Company has two reportable operating segments which correspond to our two global businesses: KCI and LifeCell Corporation ("LifeCell"). We have two primary geographic regions for which we provide supplemental information: the Americas, which is comprised principally of the United States and includes Canada, Puerto Rico and Latin America; and EMEA/APAC, which is comprised of Europe, the Middle East, Africa and the Asia Pacific region.

The condensed consolidated financial statements appearing in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

(b)Derivative Financial Instruments and Fair Value Measurements

We use derivative financial instruments to manage the economic impact of fluctuations in interest rates. We do not use financial instruments for speculative or trading purposes. Periodically, we enter into interest rate protection agreements to modify the interest characteristics of our outstanding debt. Our interest rate derivatives have not been designated as hedging instruments, and as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period.

We also use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates on our intercompany balances and corresponding cash flows and to manage our transactional currency exposures when our foreign subsidiaries enter into transactions denominated in currencies other than their local currency. We enter into foreign currency exchange contracts to manage these economic risks. These contracts are not designated as hedges; as such, we recognize the fair value of these instruments as an asset or liability with income or expense recognized in the current period. Although we use master netting agreements with our derivative counterparties, we do not offset derivative asset and liability positions in the condensed consolidated balance sheets.

All derivative instruments are recorded on the balance sheets at fair value. The fair values of our interest rate derivatives and foreign currency exchange contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly-quoted markets, which represent level 2 inputs as defined by the Codification.

(c)Concentration of Credit Risk

We have a concentration of credit risk with financial institutions related to our derivative instruments. As of September 30, 2013, Morgan Stanley, UBS and HSBC were the counterparties on our interest rate protection agreements consisting of interest rate swap and cap agreements in notional amounts totaling $1.031 billion each. We use master netting agreements with our derivative counterparties to reduce our risk and use multiple counterparties to reduce our concentration of credit risk.

We maintain cash and cash equivalents with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. These deposits bear minimal credit risk as they are maintained at financial institutions of reputable credit and generally may be redeemed upon demand.

(d)Recently Adopted Accounting Standards

In January 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2013-01 “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities." The objective of this guidance is to clarify offsetting disclosures that apply to accounting for derivatives and hedging, including bifurcated embedded derivatives, repurchase agreements, reverse repurchase agreements and securities lending transactions. This guidance is effective for fiscal years and interim periods beginning on or after January 1, 2013. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

In January 2013, the FASB issued ASU No. 2013-02 “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The objective of this guidance is to improve reporting of reclassifications out of accumulated other comprehensive income. The guidance does not change current requirements for reporting net income or other comprehensive income in financial statements. The guidance requires an entity to provide information about amounts reclassified out of accumulated other comprehensive income by component, and present either in the income statement or notes, significant amounts reclassified by the respective line items of net income. For public entities, this guidance is effective for reporting periods beginning after December 15, 2012. The adoption of this update did not have a material impact on our results of operations, financial position or disclosures.

(e)   Long-Lived Assets

When an event occurs that indicates the carrying value of long-lived assets might not be recoverable, we review property, plant and equipment for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. During the first nine months of 2013, we recorded a $30.3 million fixed asset impairment charge.

(f)Goodwill and Other Intangible Assets

Goodwill represents the excess purchase price over the fair value of net assets acquired. Goodwill is tested for impairment by reporting unit annually, or more frequently when events or changes in circumstances indicate that the asset might be impaired. Impairment of goodwill is tested by comparing the carrying value of the reporting unit to the reporting unit’s fair value. The carrying value of each reporting unit is determined by taking the reported net assets of the consolidated entity, identifying reporting unit specific assets (including goodwill) and liabilities and allocating shared operational and administrative assets and liabilities to the appropriate reporting unit, which is the same as the segment to which they are assigned. The fair value of each reporting unit is determined using discounted cash flow models using certain performance assumptions and appropriate discount rates determined by our management. To ensure the reasonableness of the estimated fair value of our reporting units, we also consider current industry market multiples. When it is determined that the carrying value of goodwill may not be recoverable based upon the existence of one or more of the above indicators of impairment, the measurement of any impairment is determined and the carrying value is reduced as appropriate.

Identifiable intangible assets include developed technology, in process research and development, customer relationships, tradenames and patents. For intangible assets that are subject to amortization, we amortize the assets over the estimated economic or contractual life of the individual asset. When an event occurs that indicates the carrying value of definite-lived intangible assets might not be recoverable, we review the assets for impairment using an undiscounted cash flow analysis. If an impairment occurs on an undiscounted basis, we compute the fair market value of the applicable assets on a discounted cash flow basis and adjust the carrying value accordingly. Indefinite-lived intangibles are tested for impairment annually, or more frequently when events or changes in circumstances indicate that the assets might be impaired. If the carrying amount of the indefinite-lived intangible assets exceeds their fair value, an impairment is recognized in an amount equal to that excess.

The Company performed an interim impairment test on goodwill of its LifeCell reporting unit during the third quarter of 2013. In our Annual Report on Form 10-K for the fiscal year ended December 31, 2012, we disclosed that in the event of an approximate 6% and 4% drop in the fair value of our LifeCell reporting unit and the fair value of our LifeCell identifiable intangible assets, respectively, the fair value of the LifeCell reporting unit and identifiable intangible assets would still exceed their book values as of October 31, 2012. The Company continued to monitor the close proximity of the reporting unit's carrying value compared to its fair value and, in the third quarter, determined it was required to complete the interim impairment test, as defined under GAAP. The results of the third quarter 2013 interim impairment test indicated that the estimated fair value of the LifeCell reporting unit was less than its carrying value; consequently, during the third quarter of 2013 we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

During the third quarter and first nine months of 2013, write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets were recorded due primarily to the discontinuation of certain projects.

(g)   Other Significant Accounting Policies

For further information on our significant accounting policies, see Note 1 of the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

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Derivative Financial Instruments and Fair Value Measurements - Gain (Loss) on Derivatives (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments gain (loss)	$ (6,840)	$ (8,579)	$ 3,200	$ (28,473)
Not Designated as Hedging Instrument [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments gain (loss)	(6,840)	(8,579)	3,200	(28,473)
Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments gain (loss)	(5,195)	(6,313)	4,057	(24,610)
Not Designated as Hedging Instrument [Member] | Interest Rate Cap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments gain (loss)	(4)	(118)	(9)	(1,563)
Not Designated as Hedging Instrument [Member] | Foreign Currency Exchange Contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative instruments gain (loss)	$ (1,641)	$ (2,148)	$ (848)	$ (2,300)

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Supplemental Balance Sheet Data (Tables)

9 Months Ended

Sep. 30, 2013

Balance Sheet Related Disclosures [Abstract]

Schedule of Accounts Receivable, Net

Accounts receivable consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Gross trade accounts receivable:
Billed trade accounts receivable	$	382,538		$	370,708
Unbilled receivables	49,350			45,466
Less:  Allowance for revenue adjustments	(69,546		)	(71,770		)
Gross trade accounts receivable	362,342			344,404
Less:  Allowance for bad debt	(7,017		)	(4,768		)
Net trade accounts receivable	355,325			339,636
Other receivables	13,575			16,082
	$	368,900		$	355,718

Schedule of Inventories, Net

Inventories consist of the following (in thousands):

	September 30, 2013			December 31, 2012
Finished goods and tissue available for distribution	$	100,873		$	96,573
Goods and tissue in-process	9,325			12,421
Raw materials, supplies, parts and unprocessed tissue	66,033			45,993
	176,231			154,987
Less: Amounts expected to be converted into equipment for short-term rental	(14,118		)	(5,237		)
Reserve for excess and obsolete inventory	(12,127		)	(9,900		)
	$	149,986		$	139,850

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Segment Information

9 Months Ended

Sep. 30, 2013

SegmentandGeographicalInstruments [Abstract]

Segment Reporting Disclosure

Segment Information

The Company is engaged in the rental and sale of advanced wound care systems and regenerative medicine products and has operations in more than 25 countries. We have two reportable operating segments which correspond to our two global businesses: KCI and LifeCell. Our two global operating segments also represent our reporting units as defined by the Codification. In most countries where we operate, certain aspects of our two businesses are supported by the same administrative staff, systems and infrastructure and, as such, we have allocated these costs between the businesses based on allocation methods including headcount, revenue and other methods as deemed appropriate. We measure segment profit (loss) as operating earnings (loss), which is defined as income (loss) before interest and other income, interest expense, foreign currency gains and losses, derivative instruments gains and losses and income taxes. All intercompany transactions are eliminated in computing revenue and operating earnings (loss).

On November 8, 2012, Getinge purchased certain assets and assumed certain liabilities comprising KCI's TSS product business. The historical results of operations of the TSS business, excluding the allocation of general corporate overhead, are reported as discontinued operations in the condensed consolidated statements of operations. Discontinued operations amounts related to TSS also exclude incremental expenses related to our transition services agreement with Getinge and the service fee payable by Getinge under the transition services agreement.

Information on segments and a reconciliation of consolidated totals are as follows (in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Revenue:
KCI	$	320,879		$	329,651		$	944,526		$	986,157
LifeCell	119,682			106,222			344,598			320,364
Total revenue	$	440,561		$	435,873		$	1,289,124		$	1,306,521
Operating earnings (loss):
KCI	$	126,837		$	114,833		$	327,018		$	277,191
LifeCell	30,093			28,864			91,159			75,503
Non-allocated costs:
General headquarter expense (1)	(6,335		)	(5,520		)	(59,447		)	(19,545		)
Equity-based compensation	(850		)	(197		)	(2,046		)	(1,186		)
Merger and restructuring-related expenses (2)	(31,112		)	(21,684		)	(97,518		)	(63,750		)
Acquired intangible asset amortization (3)	(45,099		)	(49,733		)	(138,969		)	(172,260		)
Impairment of goodwill and intangible assets (4)	(443,400		)	—			(443,400		)	—
Total non-allocated costs	(526,796		)	(77,134		)	(741,380		)	(256,741		)
Total operating earnings (loss)	$	(369,866	)	$	66,563		$	(323,203	)	$	95,953

_____________________________

(1) The third quarter and nine months ended September 30, 2013 includes write-offs of $3.5 million and $16.9 million, respectively, of other intangible assets due primarily to the discontinuation of certain projects. The nine months ended September 30, 2013 also includes a $30.3 million fixed asset impairment charge. The third quarter and nine months ended September 30, 2012 includes $9.7 million and $22.1 million, respectively, of impairment charges associated with certain production equipment at our AHS manufacturing plant and inventory associated with our V.A.C. Via product.

(2) Represents expenses related to the Merger including buyer and seller transaction costs, management fees and restructuring-related expenses.

(3) Includes amortization of acquired intangible assets related to our Merger in November 2011.

(4) During the third quarter of 2013, we recorded a $272.2 million impairment of goodwill and a $171.2 million impairment of indefinite-lived intangible assets related to our LifeCell reporting unit.

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Accumulated Other Comprehensive Income (Loss) (Tables)

9 Months Ended

Sep. 30, 2013

Schedule of Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive loss are as follows (in thousands):

	Accumulated Foreign Currency Translation Adjustment			Investment Gain		Accumulated Other Comprehensive Income (Loss)
Balances at December 31, 2012	$	(517	)	$	—	$	(517	)
Unrealized investment gain, net of tax expense of $1,413	—			2,257		2,257
Foreign currency translation adjustment, net of tax benefit of $259	(9,266		)	—		(9,266		)
Balances at September 30, 2013	$	(9,783	)	$	2,257	$	(7,526	)

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Long-Term Debt (Tables)

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

Long-term debt consists of the following (in thousands):

	September 30, 2013			December 31, 2012
Senior Dollar Term D-1 Credit Facility (1) – due 2018	$	1,601,607		$	1,613,700
Senior Euro Term D-1 Credit Facility (1) – due 2018	332,186			327,022
Senior Term D-2 Credit Facility (1) – due 2016	319,339			321,750
10.5% Second Lien Senior Secured Notes due 2018	1,750,000			1,750,000
12.5% Senior Unsecured Notes due 2019	612,000			650,000
3.25% Convertible Senior Notes due 2015	101			701
IBM Financing	2,271			—
Notional amount of debt	4,617,504			4,663,173
Senior Dollar Term D-1 Credit Facility Discount, net of accretion	(32,100		)	(33,840		)
Senior Euro Term D-1 Credit Facility Discount, net of accretion	(11,033		)	(13,353		)
Senior Term D-2 Credit Facility Discount, net of accretion	(4,860		)	(7,064		)
Second Lien Senior Secured Notes Discount, net of accretion	(25,160		)	(27,827		)
Senior Unsecured Notes Discount, net of accretion	(3,111		)	(3,594		)
Net discount on debt	(76,264		)	(85,678		)
Total debt, net of discount	4,541,240			4,577,495
Less:  Current installments	(24,101		)	(23,383		)
	$	4,517,139		$	4,554,112

_____________________________

(1) On June 14, 2013, we entered into Amendment No. 2 to our senior secured credit facility. As a result of the amendment we created new classes of Dollar Term D-1 Loans, Euro Term D-1 Loans and Term D-2 Loans, having the same rights and obligations as the Dollar Term C-1 Loans, Euro Term C-1 Loans and Term C-2 Loans as set forth in the Credit Agreement and Loan Documents, except as revised by the amendment.

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Document And Entity Information	9 Months Ended
	Sep. 30, 2013	Nov. 13, 2013 Class A-1 Partnership Units [Member]	Nov. 13, 2013 Class A-2 Partnership Units [Member]
Document Information [Line Items]
Entity Registrant Name	CENTAUR GUERNSEY L.P. INC.
Entity Central Index Key	0001557939
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		341,410,891.610	728,041.800
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2013

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Derivative Financial Instruments and Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2013

Derivative [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table sets forth the location and aggregate fair value amounts of all derivative instruments with credit-related contingent features (in thousands):

	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	Fair Value				Balance Sheet Location	Fair Value
		September 30, 2013		December 31, 2012			September 30, 2013		December 31, 2012
Derivatives not designated as hedging instruments
Interest rate swap agreements	Prepaid expenses and other	$	—	$	—	Accrued expenses and other	$	330	$	—
Interest rate swap agreements	Other non-current assets	—		—		Other non-current liabilities	30,482		34,868
Interest rate cap agreements	Prepaid expenses and other	—		9		Accrued expenses and other	—		—
Foreign currency exchange contracts	Prepaid expenses and other	230		520		Accrued expenses and other	1,008		2,980
Total derivatives		$	230	$	529		$	31,820	$	37,848

Not Designated as Hedging Instrument [Member]

Derivative [Line Items]

Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance

The following table summarizes the amount of gain (loss) on derivatives not designated as hedging instruments (dollars in thousands):

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Interest rate swap agreements	$	(5,195	)	$	(6,313	)	$	4,057		$	(24,610	)
Interest rate cap agreements	(4		)	(118		)	(9		)	(1,563		)
Foreign currency exchange contracts	(1,641		)	(2,148		)	(848		)	(2,300		)
	$	(6,840	)	$	(8,579	)	$	3,200		$	(28,473	)

Not Designated as Hedging Instrument [Member] | Interest Rate Swap [Member]

Derivative [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions

The following table summarizes our interest rate swap agreements (dollars in thousands):

Effective Dates	Original Notional Amount	Fixed Interest Rate
12/31/13-12/31/16	$512,633	2.256%
12/31/13-12/31/16	$512,633	2.249%
12/31/13-12/31/16	$512,633	2.250%