ENCORE MEDICAL CORP
EMPLOYMENT AGREEMENT
<DOCUMENT>
<TYPE>EX-10.23
<SEQUENCE>6
<FILENAME>dex1023.txt
<DESCRIPTION>EMPLOYMENT AGREEMENT
<TEXT>
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                                  Exhibit 10.23

                              EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this "Agreement") made and effective as of the
8th day of February, 2002, by and between ENCORE MEDICAL CORPORATION, a Delaware
corporation (the "Company"), and Paul Douglas Chapman (the "Employee").

     In consideration of the mutual promises contained herein, and of other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Employee agree as follows:

                                    ARTICLE 1
                                   EMPLOYMENT

     1.1 Employment Term. The Company hereby employs the Employee for a primary
term commencing on the date set forth above and, subject to earlier termination
as provided in Section 1.5 hereof, ending December 31, 2003 (the "Employment
Term"). Employee agrees to accept such employment and to perform the services
specified herein, all upon the terms and conditions hereinafter stated.

     1.2 Duties. The Employee shall serve in the capacity as Executive Vice
President - President, Chattanooga Group of the Company, or in such other
capacity as the Company may in its sole discretion direct, and shall report to,
and be subject to the general direction and control of, the Chief Executive
Officer of the Company. It is further understood and agreed that any
modification in or expansion of Employee's duties hereunder shall not, unless
specifically agreed in writing by Company, result in any modification in,
increase or decrease of Employee's compensation referred to in Section 1.4
hereof.

     1.3 Extent of Service. The Employee shall devote his full time, attention,
and energy to the business of the Company and, except as may be specifically
permitted by the Company and approved by the Chief Executive Officer of the
Company, shall not be engaged in any other business activity while in the employ
of the Company.

     1.4 Compensation

          1.4.1 Salary. The Company shall pay to the Employee a base salary at
a rate of not less than Two Hundred Ten Thousand Dollars ($210,000) per year, or
at such greater rate as the Board of Directors of the Company shall from time to
time determine (the "Base Salary"). The Base Salary shall be subject to review
on no less than an annual basis, beginning January 1, 2003. Such salary is to be
payable in installments in accordance with the payroll policies of the Company
in effect from time to time during the Employment Term.

          1.4.2 Other Benefits. The Employee shall be entitled to such vacation
days, sick days, insurance and other fringe benefit programs (including pension,
profit-sharing, bonus and

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stock plans, if any) as are established for all other executive employees of the
Company, on the same basis as such other employees are entitled thereto, it
being understood that the establishment, termination, or change of any such
program shall be at the instance of the Company, in exercise of its sole
discretion, from time to time, and any such termination or change in any such
program shall not affect this Agreement.

     1.5 Termination.

          1.5.1 Termination by Employee. At any time after one (1) year from the
commencement of the Employment Term, Employee may terminate this Agreement on
thirty (30) days' prior written notice.

          1.5.2 Termination by Company. Prior to the end of the Employment Term,
the Company may upon ten (10) days' prior written notice discharge the Employee
with or without cause at its sole option without any further liability hereunder
to the Employee or his estate; provided, however, in the event such termination
was without cause, the Company shall be required to pay the Employee, at the
time of his discharge, an amount equal to (a) one (1) year's Base Salary, (b) an
amount equal to the bonus that the Employee earned in the prior fiscal year of
the Company, in addition to any accrued, but unpaid Base Salary. In addition, if
such termination is before August 8, 2003, the Employee shall also be entitled
to (a) Base Salary for the period from termination to August 8, 2003; (b)
payment of any bonus to which he otherwise would have been entitled during or
with respect to the period from termination to August 8, 2003; (3) continuation
of insurance and other fringe benefit programs during such period, to the extent
permitted by such programs; and (4) the Company shall be obligated to provide
outplacement services to Employee at an outplacement agency selected by the
Company at a cost not to exceed $8,000. In no event shall the cost of
outplacement services be payable directly to Employee. The Employee will have no
further liability hereunder to the Company except pursuant to Article 2 and
Section 3.2 hereof. In the event such termination was with cause, the Company
shall only be required to pay the Employee, at the time of his discharge, an
amount equal to any accrued, but unpaid Base Salary. For purposes of this
Agreement, a "discharge for cause" shall mean a discharge resulting from
Employee having (i) failed or refused to follow legal and reasonable policies or
directives established and previously given to Employee in writing by Company,
(ii) willfully failed to attend to his duties after ten (10) days prior written
notice of failure to so act, (iii) committed acts amounting to gross negligence
or willful misconduct to the material detriment of Company, or (iv) otherwise
materially breached any of the terms or provisions of this Agreement after ten
(10) days prior written notice of such material breach and failure to cure such
breach. Employee shall be deemed to have been discharged for cause upon delivery
to Employee of a "Notice of Termination" stating the "Date of Termination" and
specifying the particulars of the conduct justifying discharge for cause.

                                    ARTICLE 2
                  NON-COMPETITION AND DISCLOSURE OF INFORMATION

     2.1 Non-competition. Employee acknowledges that his services to be rendered
hereunder are of a special and unusual character which have a unique value to
Company, the loss

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of which cannot adequately be compensated by damages in an action at law. In
view of the unique value to Company of the services of Employee for which
Company has contracted hereunder, and because of the confidential information to
be obtained by or disclosed to Employee, and as a material inducement to Company
to enter into this Agreement, and to pay to Employee the compensation referred
to in Section 1.4 hereof, Employee covenants and agrees that during Employee's
employment hereunder and for a period of one (1) year after he ceases to be
employed by Company, Employee shall not (a) directly or indirectly, solicit
business from, divert business from, or attempt to convert to other methods of
using the same or similar products or services as provided by Company, any
client, account or location of Company with which Employee has had any contact
as a result of his employment by Company hereunder; (b) engage in or carry on,
directly or indirectly, either for himself, as a member of a partnership, or as
a stockholder (except as limited partner or stockholder of less than one percent
(1%) of the issued and outstanding limited partnership interests or stock of a
publicly held partnership or corporation whose gross assets exceed $l,000,000),
as an investor, lender, guarantor, landlord, manager, officer, or director of
any person, partnership, corporation, or other entity (other than the Company or
its subsidiaries), or as an employee, agent, associate, broker, or consultant of
any person, partnership, corporation, or other entity (other than the Company or
its subsidiaries), any business (or segment of a business if such business
operates in more than one segment of the orthopedic industry) that competes with
any operations of the Company, as they exist at the time of Employee's
termination, within an one hundred (100)-mile radius of any geographic area
where Company is actually engaged in business, or maintains sales or service
representatives or employees; or (c) directly or indirectly, solicit for
employment or employ any employee of Company.

     2.2 Disclosures of Information. The Employee acknowledges that in the
course of his employment by the Company, he will receive certain trade secrets,
programs, methods of operation, financial information, lists of customers, and
other confidential information and knowledge concerning the businesses of the
Company (hereinafter collectively referred to as "Information") that the Company
desires to protect. As a material inducement to Company to enter into this
Agreement, and to pay to Employee the compensation referred to in Section 1.4
hereof, Employee covenants and agrees that he shall not, at any time during or
following the term of his employment hereunder, directly or indirectly, divulge
or disclose, for any purpose whatsoever, any of such Information which has been
obtained by or disclosed to him as a result of his employment by Company. The
Employee further agrees that he will at no time use the Information in competing
with the Company. Upon termination of this Agreement, the Employee shall
surrender to the Company all lists, books, financial information, records,
literature, products, papers, documents, writings, and other property produced
by him or coming into his possession by or through his employment relating to
the Information, and the Employee agrees that all such materials will at all
times remain the property of the Company. In the event of a breach or threatened
breach by Employee of any of the provisions of this Article 2, Company, in
addition to and not in limitation of any other rights, remedies or damages
available to Company at law or in equity, shall be entitled to a permanent
injunction in order to prevent or to restrain any such breach by Employee, or by
Employee's partners, agents, representatives, servants, employers, employees
and/or any and all persons directly or indirectly acting for or with him.

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     2.3 Accounting for Profits. Employee covenants and agrees that if he shall
violate any of his covenants or agreements under Article 2 hereof, Company shall
be entitled to an accounting and repayment of all profits, compensation,
commissions, remunerations or benefits which Employee directly or indirectly has
realized and/or may realize as a result of, growing out of or in connection with
any such violation; such remedy shall be in addition to and not in limitation of
any injunctive relief or other rights or remedies to which Company is or may be
entitled at law or in equity or under this Agreement.

     2.4 Reasonableness of Restrictions.

          2.4.1 Employee has carefully read and considered the provisions of
Article 2 hereof and, having done so, agrees that the restrictions set forth in
such Article (including, but not limited to, the time period of restriction and
the geographical areas of restriction set forth in Article 2 hereof) are fair
and reasonable and are reasonably required for the protection of the interest of
Company, its officers, directors and other employees.

          2.4.2 In the event that, notwithstanding the foregoing, any of the
provisions of Article 2 hereof shall be held to be invalid or unenforceable, the
remaining provisions thereof shall nevertheless continue to be valid and
enforceable as though the invalid or unenforceable parts had not been included
therein. In the event that any provision of Article 2 relating to time period
and/or areas of restriction shall be declared by a court of competent
jurisdiction to exceed the maximum time period or areas such court deems
reasonable and enforceable, said time period and/or areas of restriction shall
be deemed to become and thereafter be the maximum time period and/or areas which
such court deems reasonable and enforceable.

                                    ARTICLE 3
                               EMPLOYEE INVENTIONS

     3.1 Employee Inventions. Employee shall promptly disclose to the Company or
its designee any and all ideas, inventions, works of authorship (including, but
not limited to computer programs, software and documentation), improvements,
discoveries, developments, or innovations (hereinafter referred to as "said
inventions"), whether patentable or unpatentable, copyrightable or
uncopyrightable, made, developed, worked on, or conceived by Employee, either
solely or jointly with others, whether or not reduced to drawings, written
description, documentation, models, or other tangible form: (a) during the
Employment Term that relate to, or arise out of, any developments, services,
research, or products of, or pertain to the business of, the Company and (b) for
a period of six (6) months after termination of the Employment Term, said
inventions that relate to, or arise out of, any developments, services,
research, or products that Employee has been concerned with during the term of
his employment.

     3.2 Assignment. Employee hereby assigns and agrees to assign to the
Company, its successors and assigns, Employee's entire right, title, and
interest in and to any of said inventions. All of said inventions shall
forthwith and without further consideration become and be the exclusive property
of the Company, it successors and assigns.

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     3.3 Cooperation. Employee shall, without further compensation, do all
lawful things, including, but not limited to, maintaining invention records that
shall be the property of the Company, rendering assistance, giving of evidence
and testimony, and executing necessary documents, as requested, to enable the
Company to file and obtain patents in the United States and foreign countries on
any of said inventions, as well as to protect the Company's interest in any of
said inventions.

                                    ARTICLE 4
                                  MISCELLANEOUS

     4.1 Notices. All notices, requests, consents, and other communications
under this Agreement shall be in writing and shall be deemed to have been
delivered on the date personally delivered or on the date mailed, postage
prepaid, by certified mail, return receipt requested, or telegraphed or telexed
and confirmed if addressed to the respective parties as follows: (a) if to the
Employee to the address set forth below, and (b) if to the Company to Encore
Medical Corporation, 9800 Metric Blvd., Austin, Texas 78758 ATTENTION: Chairman
of the Board. Either party hereto may designate a different address by providing
written notice of such new address to the other party hereto.

     4.2 Specific Performance. The Employee acknowledges that a remedy at law
for any breach or attempted breach of Section 1.3 and Article 2 of this
Agreement will be inadequate, and agrees that the Company shall be entitled to
specific performance and injunctive and other equitable relief in case of any
such breach or attempted breach, and further agrees to waive any requirement for
the securing or posting of any bond in connection with the obtaining of any such
injunctive or any other equitable relief. In the event the Company brings legal
action to enforce its rights hereunder, the Employee shall pay all of the
Company's court costs and legal fees and expenses arising out of such action if
the Company prevails in such action.

     4.3 Severability. Whenever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Agreement.

     4.4 Assignment. This Agreement may not be assigned by the Employee. Neither
the Employee nor his spouse shall have any right to commute, encumber, or
otherwise dispose of any right to receive payments hereunder, it being the
intention of the parties that such payments and the rights thereto are
nonassignable and nontransferable. This Agreement is only assignable by the
Company to a parent, subsidiary, successor or other affiliate of the Company.

     4.5 Binding Effect. Subject to the provisions of Section 4.4 of this
Agreement, this Agreement shall be binding upon and inure to the benefit of the
parties hereto, the Employee's heirs and personal representatives, and the
successors and assigns of the Company.

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     4.6 Governing Law. This Agreement shall be construed and enforced in
accordance with and governed by the laws of the State of Texas.

     4.7 Entire Agreement; Amendment. This Agreement contains the entire
understanding between the parties, and there are no agreements or understandings
among the parties except as set forth herein. The Employee represents and
warrants to the Company that at the time of execution of this Agreement he is
not a party to any other employment agreement. Employee further represents and
warrants that he neither has any proprietary information of any other business
nor is he providing any other business' proprietary information to the Company.
No alteration or modification of this Agreement shall be valid except by
subsequent written instrument executed by the parties hereto. No waiver by
either party of any breach by the other party of any provision or condition of
this Agreement in one circumstance shall be deemed a waiver of such provision or
condition in any other circumstances or be deemed a waiver of any other
provision or condition. The section and paragraph headings in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.

                                            COMPANY:

                                            ENCORE MEDICAL CORPORATION



                                            By:  /s/ Kenneth W. Davidson
                                                     Kenneth W. Davidson, Chief
                                                     Executive Officer

                                            EMPLOYEE:



                                            /s/ Paul Douglas Chapman
                                            PAUL DOUGLAS CHAPMAN

                                            Address:   1006 Hanover Street
                                                       Chattanooga, TN  37405

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