**Exhibit 4.7**
**INDEMNIFICATION ESCROW AGREEMENT**
     This INDEMNIFICATION ESCROW AGREEMENT (this “Agreement”), dated as of October 4, 2004,is made and entered into by and among Encore Medical Corporation, a Delaware corporation (the“Acquiror”), MPI HOLDINGS, LLC, a Delaware limited liability company (“MPI”),solely in its capacity as the initial Holder Representative (MPI and any of its successors in suchcapacity being sometimes referred to herein in such capacity as the “HolderRepresentative”) and JPMorgan Chase Bank, a New York corporation (the “Escrow Agent”).
W I T N E S S E T H :
     **WHEREAS**, the Acquiror, Empi, Inc. a Minnesota corporation (the “Company”), EncoreMedical Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Acquiror(“Merger Sub”), MPI, solely in its capacity as the initial Holder Representative, and theCompany Principal Shareholders have entered into that certain Agreement and Plan of Merger, datedas of August 8, 2004 and attached hereto as Exhibit A (the “Merger Agreement”;capitalized terms used herein and not otherwise defined having the meanings assigned to them in theMerger Agreement), which provides for, among other things, the merger of Merger Sub with and intothe Company, with the Company being the surviving corporation;
     **WHEREAS**, pursuant to the terms of the Merger Agreement, the Stock Portion of the MergerConsideration shall be delivered by the Acquiror to the Escrow Agent to be held in escrow (i) assecurity for the indemnification obligations in favor of Acquiror under Article XIII of the MergerAgreement and (ii) as a security for any amount payable to the Acquiror pursuant to Section 1.5(d)of the Merger Agreement to the extent provided in Section 1.5(d) of the Merger Agreement; and
     **WHEREAS**, Acquiror and the Holder Representative desire that the Escrow Agent hold and disposeof such escrowed property, and the Escrow Agent is willing to do so, on the terms and conditionshereinafter set forth;
     **NOW, THEREFORE**, in consideration of the premises and the mutual covenants contained herein,the parties hereto agree as follows:
     1.   **Appointment of Escrow Agent****.**By its signature below, Escrow Agentacknowledges receipt of the Escrow Shares (as defined below). The Escrow Agent is herebyconstituted and appointed the escrow agent hereunder.
     2.   **Escrow Property****.**Simultaneously with the execution of this Agreement,Acquiror shall deliver to and deposit with the Escrow Agent, in accordance with the MergerAgreement, a stock certificate in the name of the Escrow Agent (or its nominee) representing eightmillion (8,000,000) shares of Acquiror Common Stock (the “Escrow Shares”). The EscrowAgent agrees to hold in escrow, in accordance with this Agreement, the Escrow Shares together withany dividends or other distributions (other than cash dividends or distributions) made on theEscrow Shares and such cash, stock or other property into which Escrow Shares may be changedpursuant to any merger consideration or similar transaction involving the Acquiror and anysubstitutions of cash for such Escrow Shares pursuant to Section 6 of this Agreement, in each casewith the benefit of any earnings thereon (collectively, the “Escrow Property”). The EscrowAgent hereby agrees to take appropriate measures to safeguard the certificates(s) evidencing EscrowShares in accordance with customary custodial practices and to retain the other Escrow Property inan account.
     3.   **Investment of Cash**. During the term of this Agreement, any EscrowProperty received in the form of cash shall be invested and reinvested by the Escrow Agent in oneof the following investments as per the joint instruction of Acquiror and the HolderRepresentative:
 •  JPMorgan Chase Bank Money Market Account;  •  A trust account with JPMorgan Chase Bank;  •  A money market mutual fund, including without limitation the JPMorgan Fund or anyother mutual fund for which the Escrow Agent or any affiliate of the Escrow Agentserves as investment manager,
 

 

administrator, shareholder servicing agent and/orcustodian or subcustodian, notwithstanding that (i) the Escrow Agent or an affiliate ofthe Escrow Agent receives fees from such funds for services rendered, (ii) the EscrowAgent charges and collects fees for services rendered pursuant to this EscrowAgreement, which fees are separate from the fees received from such funds, and (iii)services performed for such funds and pursuant to this Escrow Agreement may at timesduplicate those provided to such funds by the Escrow Agent or its affiliates.
In the absence of investment instructions, the Escrow Property shall be invested in a JPMorganChase Bank Money Market Account. The Escrow Agent shall have no liability for any loss sustainedas a result of any investment in an investment indicated herein. Subject to Section 8(b), 60% ofall interest earned and other income earned on the Escrow Property shall become part of the EscrowProperty. The Escrow Agent shall distribute 40% of all interest earned and other income earned onthe Escrow Property (excluding amounts to be distributed pursuant to Section 8(b)) to the holdersof the Common Shares and Options pro rata at their respective mailing addresses and in accordancewith their Applicable Percentages, both as set forth on Exhibit B. Such distribution shallbe made by December 31st of each year.
     4.   **Transfer of Escrow Shares Following Determination Date**.Immediately following the date on which the Holder Representative finally determines anddelivers to Acquiror its calculation of the Closing Date Net Working Capital, the Closing DateFunded Debt and the Closing Date Cash and Cash Equivalents (the “Determination Date”), theAcquiror and the Holder Representative shall deliver to the Escrow Agent (if required by Section1.5(d) of the Merger Agreement) joint written instructions setting forth how the Escrow Shares (ifany) are to be delivered to the Acquiror, which instructions shall be based on the terms set forthin Section 1.5 of the Merger Agreement. As promptly as practicable following receipt of such jointwritten instruction, the Escrow Agent shall deliver to the Acquiror the number of Escrow Shares (ifany) as specified in such joint written instruction by delivering the stock certificaterepresenting the Escrow Shares to the Acquiror’s stock transfer agent in exchange for a stockcertificate in the name of the Escrow Agent (or its nominee) representing the number of remainingEscrow Shares to be retained as Escrow Property as set forth in the joint written instructionsdelivered to the Escrow Agent.
     5.   **Payment of Damages****.**
     (a) The Escrow Property shall be available to pay, in accordance with the procedures set forthherein, any Damages for which a Purchaser Indemnitee is entitled to indemnification pursuant toArticle XIII of the Merger Agreement (subject to the limitations therein); provided,however, that any claims by a Purchaser Indemnitee for indemnification under Article XIIIof the Merger Agreement must be made before the Distribution Date (as defined herein).
     (b) If a Purchaser Indemnitee determines in good faith that it is entitled to indemnificationfor Damages pursuant to Section 13.2 of the Merger Agreement, the Acquiror may deliver to theEscrow Agent and the Holder Representative a written request for the payment of such Damages amount(a “Payment Request”), which Payment Request shall identify in reasonable detail the factsand circumstances with respect to the subject matter of such Damages claim and the section of theMerger Agreement for which indemnification is sought and the amount and method of computing theamount of Damages. Any Third Party Action shall be identified as such in the Payment Request.Within thirty (30) days after the Holder Representative receives a Payment Request, the HolderRepresentative shall deliver to the Escrow Agent and the Acquiror a written notice (a “ResponseNotice”) stating whether the Holder Representative objects to the Payment of all or any portionof the Damages amount set forth in the Payment Request and advising of the allocation of sharesand/or cash to be delivered. In the event the Holder Representative does not deliver a ResponseNotice within 30 days after its receipt of a Payment Request, it will be deemed not to haveobjected to any portion of the Damages amount set forth in the Payment Request and the Escrow Agentshall pay such Damages amount to Acquiror in accordance with Section 5(c) below. The Escrow Agentwill be prohibited from paying any Damages amount in dispute as set forth in the Response Notice,unless (i) the Holder Representative delivers a written notice (an “Amended ResponseNotice”) to the Escrow Agent stating that the Holder Representative has withdrawn its objectionwith respect to all or any part of the objections set forth in the Response Notice or (ii) Acquirordelivers to the Escrow Agent and the Holder Representative a copy of a final, non-appealable orderof a court of competent jurisdiction (a “Final Order”) determining that Acquiror isentitled to payment of such Damages amount under the Merger Agreement and directing the EscrowAgent to disburse an amount set forth in such order (provided that the Escrow Agent shall be entitled to receive from the claimingparty, with a copy to the non-claiming party, a letter, on which the Escrow Agent may conclusivelyrely, to the effect that the order of the court is final and binding, unless the non-claiming partyprovides written notice to the Escrow Agent and the claiming party that the order of the Court isnot final and binding within 15 days of receipt of the Final Order by the Escrow Agent and thenon-claiming party). In the event there is a dispute between Acquiror and the HolderRepresentative as to whether an order from a court is a Final Order, the Escrow Agent shall havethe right to interplead all interested parties in accordance with
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Section 11(a). Upon receipt ofan Amended Response Notice from the Holder Representative or a Final Order, as applicable, theEscrow Agent shall thereafter act in accordance with Section 5(c) below.
     (c) If the Escrow Agent has received a Response Notice (or fails to receive a Response Noticeas specified above), an Amended Response Notice or a Final Order, and if such Response Notice (orPayment Request in the event Escrow Agent has not received a Response Notice as specified above),Amended Response Notice or Final Order indicates that a Purchaser Indemnitee is entitled to paymentin respect of all or any portion of a Damages amount set forth in a Payment Request, then theEscrow Agent shall release Escrow Property and deliver to the Purchaser Indemnitee a number ofEscrow Shares or cash held in escrow in an amount equal to the amount due to the PurchaserIndemnitee as indicated in such Response Notice (or Payment Request in the event Escrow Agent hasnot received a Response Notice as specified above), Amended Response Notice or Final Order (the“Payment Amount”) (it being understood and agreed that the Holder Representative shalldesignate in writing the mix of Escrow Shares and/or cash to be released by the Escrow Agent inrespect of such Payment Amount (a “Payment Instruction Notice”). If such Response Notice,Amended Response Notice or Final Order indicates that the Purchaser Indemnitee is not entitled toall or any portion of the Damages amount set forth in the Payment Request, then the Escrow Agentshall hold the amount of Escrow Shares and/or cash to which the Purchaser Indemnitee is determinednot to be entitled in accordance with the terms of this Agreement until such amounts aredistributed (i) to the holders of Common Shares and Options pursuant to Section 7 below, (ii) toany Purchaser Indemnitee in respect of another Payment Request pursuant to this Section 5 or (iii)as specified in joint written instructions from the Holder Representative and the Acquiror. Forpurposes hereof, in the event a Purchaser Indemnitee is to receive Escrow Shares in respect of anyPayment Amount or any portion thereof, such Purchaser Indemnitee shall be entitled to receive anumber of Escrow Shares equal to (x) such Payment Amount or portion thereof, divided by (y) theaverage closing price for one share of Escrow Shares for the ten (10) Business Day period ending onthe Business Day immediately preceding the date on which such shares are released by the EscrowAgent. The Response Notice (or Payment Request in the event the Escrow Agent has not received aResponse Notice as specified above), Amended Response Notice or Final Order shall specify theamount of shares and/or cash to which the Purchaser Indemnitee is entitled (it being understoodthat the Escrow Agent will not be responsible for the calculations associated therewith). In theevent any Escrow Shares are to be delivered to the Acquiror pursuant to this Section 5, the EscrowAgent shall deliver to the Acquiror such number of Escrow Shares (if any) as specified in theResponse Notice (or Payment Request in the event the Escrow Agent has not received a ResponseNotice as specified above), Amended Response Notice or Final Order by delivering the stockcertificate representing the Escrow Shares then held by the Escrow Agent as Escrow Property toAcquiror’s stock transfer agent in exchange for a stock certificate in the name of the Escrow Agent(or its nominee) representing the number of remaining Escrow Shares to be retained as EscrowProperty as set forth in such Response Notice (or Payment Request in the event the Escrow Agent hasnot received a Response Notice as specified above), Amended Response Notice or Final Orderdelivered to the Escrow Agent.
     6.   **Substitution of Escrow Property****.**At any time, the HolderRepresentative shall have the right to replace Escrow Shares with cash by providing a writtennotice to the Escrow Agent and the Acquiror setting forth the number of Escrow Shares to be soreplaced (a “Replacement Notice”). As promptly as practicable after delivery of aReplacement Notice, the Escrow Agent shall deliver to the Holder Representative (or its designee),the number of Escrow Shares specified in the Replacement Notice in exchange for the delivery by theHolder Representative (or its designee) of cash in an amount equal to the product of (x) the numberof such Escrow Shares to be replaced and (y) 4.702 (the “Closing Stock Price”);provided, however, that the Closing Stock Price shall be proportionately reduced orincreased, as applicable, to account for any stock split, subdivision, stock dividend,recapitalization, merger, combination or similar transaction (a “Capital Stock Event”) inrespect of the Escrow Shares occurring after the date hereof. The Escrow Agent shall effect thedelivery of Escrow Shares pursuant to this Section 6 by delivering the stock certificaterepresenting the Escrow Shares then held by the Escrow Agent as Escrow Property to Acquiror’s stocktransfer agent in exchange for: (i) stock certificates for and in the name of the personsdesignated by the Holder Representative in writing representing the number of Escrow Shares asspecified in the Replacement Notice; and (ii) a stock certificate in the name of the Escrow Agent(or its nominee) representing the number of remaining Escrow Shares to be retained as EscrowProperty as set forth in such Replacement Notice. The Acquiror agrees to (i) provide the HolderRepresentative written notice of any Capital Stock Event setting forth in reasonable detail theterms and conditions thereof and (ii) to cause its stock transfer agent to deliver as promptly aspracticable a stock certificate in the name of the Escrow Agent (or its nominee) representing suchnew number of shares or other securities in which the Escrow Shares then held as Escrow Property shall have beenconverted into, or shall otherwise reflect to account for dividends or distributions, pursuant tothe Capital Stock Event in exchange for the delivery by the Escrow Agent of the stock certificaterepresenting the Escrow Shares held by the Escrow Agent as Escrow Property immediately prior to theCapital Stock Event. The parties hereto further agree to provide such reasonable cooperation andtake such actions as may be reasonably requested by the other parties in connection with a sale orregistration of Escrow Shares made in conjunction with the replacement of Escrow Shares with cashpursuant to this Section 6.
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     7.   **Distribution of Escrow Property****.**
     (a) Promptly after the first anniversary of the date of this Agreement (the “DistributionDate”), the Escrow Agent shall distribute the Escrow Property, in accordance with the writteninstructions of the Holder Representative, to the holders of the Common Shares and Options listedin Exhibit B at their respective mailing addresses pro rata in accordance with theirApplicable Percentages as set forth on Exhibit B; provided, however, thatin the event that (i) prior to the Distribution Date, Acquiror delivers a Payment Request seekingindemnification for Damages pursuant to Section 13.2 of the Merger Agreement (a “PendingClaim”) and such claim is unresolved as of the Distribution Date, the Escrow Agent shall notdistribute and will continue to hold pursuant hereto Escrow Property having a value equal to theDamages payment sought with respect to such Pending Claim that is unresolved (the “ReservedProperty”) (it being understood and agreed that the Holder Representative shall, in such event,have the right to designate the mix of Escrow Shares and/or cash to be released pursuant to thisSection 7). For purposes of calculating the Reserved Property, each Escrow Share shall be valuedat the average closing price for one share of Acquiror Common Stock for the ten (10) Business Dayperiod ending on the Business Day immediately preceding the Distribution Date. The ReservedProperty shall remain in escrow following the Distribution Date pending resolution of theapplicable Pending Claims and, upon resolution of the applicable Pending Claim, shall be either (i)distributed in whole or in part to Acquiror as appropriate following resolution of the applicablePending Claim in accordance with Section 5 or (ii) distributed in whole or in part to the holdersof Common Shares and Options listed in Exhibit B as provided in this Section 7. In theevent that (i) the Holder Representative or Acquiror delivers to the Escrow Agent a Final Orderthat determines or provides that the Purchaser Indemnitees are or are not, as the case may be,entitled to payment or reimbursement of some or all of the Damages requested in any Pending Claimor (ii) the Holder Representative and Acquiror deliver to the Escrow Agent joint writteninstructions signed by Acquiror and the Holder Representative indicating that the PurchaserIndemnitees are or are not, as the case may be, entitled to some or all of the Damages requested inany Pending Claim, the Escrow Agent will disburse the Reserved Property or portion thereof held inrespect of the Damages subject to such Pending Claim to (A) the holders of the Common Shares andOptions listed in Exhibit B at their respective mailing addresses pro rata in accordancewith their Applicable Percentages as set forth in Exhibit B and as specified in writteninstructions of the Holder Representative and/or (B) Acquiror, in each case, as specified in suchFinal Order or joint written instructions. At such time as all Pending Claims have been finallyresolved in accordance with this Agreement and there remains any Reserved Property, all remainingReserved Property shall be delivered or paid to the holders of the Common Shares and Options attheir respective mailing addresses listed in Exhibit B pro rata in accordance with theirApplicable Percentages as set forth in Exhibit B and as specified in the writteninstructions of the Holder Representative. A Pending Claim shall be considered to be resolved atsuch time as (i) one of the parties has delivered to the Escrow Agent a Final Order determining theextent (if any) to which the Acquiror is entitled to indemnification under Section 13.2 of theMerger Agreement for the Damages pursuant to such Pending Claim or (ii) the Acquiror and the HolderRepresentative provide to the Escrow Agent joint written instructions signed by Acquiror and theHolder Representative advising the Escrow Agent that such Pending Claim has otherwise beenresolved, which such joint written instruction indicates the extent (if any) to which the Acquiroris entitled to indemnification under Section 13.2 of the Merger Agreement for the Damages pursuantto such Pending Claim.
     (b) In the event a Final Order is delivered to the Escrow Agent pursuant to this Agreement,the Escrow Agent shall be entitled to receive from the claiming party, with a copy to thenon-claiming party, a letter, on which the Escrow Agent may conclusively rely, to the effect thatthe order of the court is final and binding, unless the non-claiming party provides written noticeto the Escrow Agent and the claiming party that the order of the Court is not final and bindingwithin 15 days of receipt of the Final Order by the Escrow Agent and the non-claiming party. Inthe event there is a dispute between Acquiror and the Holder Representative as to whether an orderfrom a court is a Final Order, the Escrow Agent shall have the right to interplead all interestedparties in accordance with Section 11(a).
     (c) The Escrow Agent shall effect the delivery of Escrow Shares (if any) pursuant to thisSection 7 by delivering the stock certificate representing the Escrow Shares then held by theEscrow Agent as Reserved Property to the Acquiror’s stock transfer agent in exchange for: (i) inthe case where Escrow Shares held as Reserved Property are to be delivered to the holders of theCommon Shares and Options, stock certificates for and in the name of the persons designated by theHolder Representative in writing representing the number of Escrow Shares as specified in the FinalOrder or joint written instructions signed by Acquiror and the Holder Representative delivered tothe Escrow Agent; and (ii) in the case where Escrow Shares are to remain as Reserved Property, astock certificate in the name of the Escrow Agent (or its nominee) representing the number of remaining Escrow Shares to be retained as ReservedProperty as specified in the Final Order or joint written instructions signed by Acquiror and theHolder Representative delivered to the Escrow Agent.
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     (d) Acquiror hereby agrees to cause its stock transfer agent to deliver as promptly aspracticable stock certificates to the Escrow Agent and otherwise take such necessary actions toeffect the exchange of stock certificates representing Escrow Shares or other securities ascontemplated by this Agreement.
     8.   **Voting of Shares and Dividends.**
     (a) If a meeting or written action of the Acquiror’s stockholders occurs while this Agreementis in effect and Escrow Shares are held as Escrow Property, the Acquiror shall promptly send to theHolder Representative and the Escrow Agent copies of any notices, proxies and proxy materials inconnection with such meeting or written action when such materials are sent to the stockholders ofthe Acquiror, and the Escrow Agent shall vote the Escrow Shares in accordance with the writteninstructions of the Holder Representative.
     (b) All cash dividends and distributions made with respect to the Escrow Shares shall bedistributed, promptly upon receipt, to the holders of Common Shares and Options listed inExhibit B at their respective mailing addresses, pro rata in accordance with theirApplicable Percentages as set forth on Exhibit B.
     9.   **Tax Matters****.**For tax purposes, all interest and other income earned onthe Escrow Property (other than cash dividends and distributions received by the holders of CommonShares and Options pursuant to Section 8(b)) shall be reported as taxable income of the holders ofCommon Shares and Options pro rata in accordance with their Applicable Percentage as set forth onExhibit B. Any cash dividends or distributions made in respect of Escrow Shares andreceived by the holders of Common Shares and Options pursuant to Section 8(b) shall be reported fortax purposes as taxable income of the applicable recipient. Acquiror shall file tax returns andthe Escrow Agent shall file a Form 1099 INT consistent with such treatment. Payment of anyinterest and other income earned on the Escrow Property will, and the distribution of any otheramounts under this escrow may, be subject to U.S. backup withholding tax unless a properlycompleted IRS Form W-8 or W-9 certification is submitted to the Escrow Agent by the person entitledto receive such payment. An IRS Form W-8 or W-9 certification shall be submitted for each holderof Common Shares and Options, as well as for each of Acquiror and the Holder Representative to theEscrow Agent on or before the date the Escrow Property is deposited into escrow.
     10.   **Security Procedures**. In the event funds transfer instructions aregiven (other than in writing at the time of execution of this Escrow Agreement, as indicated inSection 2 herein) whether in writing, by telecopier or otherwise, the Escrow Agent is authorized toseek confirmation of such instructions by telephone call-back to the person or persons designatedon schedule 1 hereto (“Schedule 1”), and the Escrow Agent may rely upon the confirmation ofanyone purporting to be the person or persons so designated. The persons and telephone numbers forcall-backs may be changed only in a writing actually received and acknowledged by the Escrow Agent.If the Escrow Agent is unable to contact any of the authorized representatives identified inSchedule 1, the Escrow Agent is hereby authorized to seek confirmation of such instructions bytelephone call-back to any one or more of the executive officers of the other parties hereto(“Executive Officers”), which shall include the titles of Partner, Managing Director,Principal, President or Vice President, as the Escrow Agent may select. Such Executive Officershall deliver to the Escrow Agent a fully executed Incumbency Certificate, and the Escrow Agent mayrely upon the confirmation of anyone purporting to be any such Executive Officer. The Escrow Agentand the beneficiary’s bank in any funds transfer may rely solely upon any account numbers orsimilar identifying numbers provided by the Acquiror or the Holder Representative to identify (i)the beneficiary, (ii) the beneficiary’s bank or (iii) an intermediary bank. The Escrow Agent mayapply any of the escrowed funds for any payment order it executes using any such identifyingnumber, even when its use may result in a person other than the beneficiary being paid, or thetransfer of funds to a bank other than the beneficiary’s bank or an intermediary bank sodesignated. The parties to this Escrow Agreement acknowledge that these security procedures arecommercially reasonable.
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     11. **Duties of the Escrow Agent.**
          (a) **Duties in General****.**
               (1) The Escrow Agent undertakes to perform only such duties as are expressly set forth herein(and required by applicable law), which the parties agree are ministerial in nature. The EscrowAgent shall have no duty to inquire as to the provisions of any other agreement. The Escrow Agentmay consult with counsel of its choice and shall be protected in any action taken or omitted inconnection with the advice or opinion of such counsel.
               (2) If the Escrow Agent becomes involved in litigation with respect to this Agreement for anyreason, it is hereby authorized to deposit the Escrow Property with the clerk of such court inwhich such litigation is pending, or to interplead all interested parties in any court of competentjurisdiction and to deposit with the clerk of such court the Escrow Property. Upon the happening ofeither of the above, the Escrow Agent shall be fully relieved and discharged of any further dutieshereunder.
               (3) If the Escrow Agent should at any time be confronted with inconsistent instructions,claims or demands by the parties hereto, the Escrow Agent shall be entitled to refrain from takingany action and its sole obligation shall be to keep safely all property held in escrow until itshall be directed otherwise in writing by all of the other parties hereto or by a final order orjudgment of a court of competent jurisdiction. The Escrow Agent shall have the right to interpleadsuch parties in any state or federal court located in the State of New York (or if such court doesnot have jurisdiction, any other court of competent jurisdiction), to deposit the Escrow Propertywith the clerk of such court, and to request that such court determine the respective rights of theparties with respect to this Agreement, and upon doing so, the Escrow Agent automatically shall bereleased from any obligations or liability as a consequence of any claims or demands hereunder.
          (b) **Exculpation****.**Except for the Escrow Agent’s own willful misconduct, bad faith orgross negligence: (i) the Escrow Agent shall have no liability of any kind whatsoever for itsperformance of any duties imposed upon the Escrow Agent under this Agreement or for any of its actsor omissions hereunder; (ii) the Escrow Agent shall not be responsible for any of the acts oromissions of the other parties hereto; (iii) the Escrow Agent shall not be liable to any Person nota party hereto for damages, losses or expenses arising out of this Agreement; and (iv) the EscrowAgent may rely and/or act upon any written instrument, document or request believed by the EscrowAgent in good faith to be genuine and to be executed and delivered by the proper Person, and mayassume in good faith the authenticity, validity and effectiveness thereof and shall not beobligated to make any investigation or determination as to the truth and accuracy of anyinformation contained therein. Anything in this Agreement to the contrary notwithstanding, in noevent shall the Escrow Agent be liable for special, indirect or consequential loss or damage of anykind whatsoever (including but not limited to lost profits).
          (c) **No Additional Duties.** The Escrow Agent shall have no duties except those that areexpressly set forth herein, and it shall not be bound by any notice of a claim or demand hereunder,or any waiver, modification, amendment, termination or rescission of this Agreement, unlessreceived by it in writing.
          (d) **Miscellaneous.** The Escrow Agent may execute any of its powers or responsibilitieshereunder and exercise any rights hereunder either directly or by or through its agents orattorneys. The Escrow Agent shall not be responsible for and shall not be under a duty to examineor pass upon the validity, binding effect, execution or sufficiency of this Agreement or of anyagreement amendatory or supplemental hereto.
     12.   **Fees and Expenses of Escrow Agent.** For the Escrow Agent’s serviceshereunder, Acquiror, on the one hand, and the Holder Representative, on the other hand, severallyand not jointly, each agree to (i) pay to the Escrow Agent fifty percent (50%) of the fees of$3,500 per year (payable for the first year promptly following execution and delivery of thisAgreement) and (ii) reimburse the Escrow Agent upon request for fifty percent (50%) of allreasonable expenses, disbursements and advances, including reasonable attorneys’ fees, incurred ormade by it in connection with carrying out its duties hereunder (it being understood and agreedthat all such fees, expenses, disbursements and advances payable by the Holder Representative shallbe Holder Allocable Expenses).
     13.   **Indemnification of the Escrow Agent.** In consideration of itsacceptance of the appointment as Escrow Agent, Acquiror and the Holder Representative each agree toindemnify and hold the Escrow Agent harmless as to fifty percent (50%) of any loss, liability orexpense incurred by the Escrow Agent without gross negligence, bad faith or
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willful misconduct by the Escrow Agent by reason of its having accepted the same or incarrying out any of the terms hereof. The foregoing indemnities shall survive the resignation orremoval of the Escrow Agent or the termination of this Agreement.
     14.   **Resignation of the Escrow Agent.** The Escrow Agent, and any successorEscrow Agent, may resign at any time as Escrow Agent hereunder by giving at least fifteen (15)Business Days written notice to the other parties hereto. Upon such resignation and theappointment of a successor Escrow Agent, the resigning Escrow Agent shall be absolved from anyduties as Escrow Agent hereunder. Upon their receipt of notice of resignation from the EscrowAgent, the Acquiror and the Holder Representative shall use their reasonable best efforts jointlyto designate a successor Escrow Agent. If the Acquiror and the Holder Representative do not agreeupon a successor Escrow Agent within fifteen (15) Business Days after the receipt by the parties ofthe Escrow Agent’s resignation notice, the Escrow Agent may petition any court of competentjurisdiction for the appointment of a successor Escrow Agent or other appropriate relief and anysuch resulting appointment shall be binding upon all parties hereto. By mutual agreement, theAcquiror and the Holder Representative shall have the right at any time upon not less than seven(7) Business Days written notice to terminate the appointment of the Escrow Agent, or any successorEscrow Agent, as Escrow Agent hereunder. Notwithstanding anything to the contrary in theforegoing, the Escrow Agent, or any successor Escrow Agent, shall continue to act as Escrow Agentuntil a successor is appointed and qualified to act as Escrow Agent.
     15.   **Notices.** All notices and other communications required or permittedpursuant to this Agreement shall be in writing and be deemed to have been duly given when deliveredpersonally (which shall include delivery by Federal Express or other nationally recognized,reputable overnight courier service that issues a receipt or other confirmation of delivery) to theparty for whom such communication is intended, or three (3) business after the date mailed bycertified mail, return receipt requested, postage prepaid, as follows:    **If to Acquiror:**    Encore Medical Corporation 9800 Metric Boulevard Austin, Texas 78758 Attention: Harry L. Zimmerman Telecopy No. (512) 834-6310    with copies to:    Jackson Walker LLP 100 Congress Avenue, Suite 1100 Austin, Texas 78701 Attention: Lawrence A. Waks Telecopy No. (512) 236-2002    and    **If to the Holder Representative:**    MPI Holdings, LLC c/o The Carlyle Group 520 Madison Avenue New York, New York 10022 Attention: W. Robert Dahl Telecopy No.: (212) 381-4901    with copies to:    Latham & Watkins LLP 555 Eleventh Street, N.W. Suite 1000 Washington, D.C. 20004-1304 Attention: Daniel T. Lennon Telecopy No.: (202) 637-2201   
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    and    **If to the Escrow Agent:**    JPMorgan Chase Bank 4 New York Plaza, 21st Floor Attention: Joe Morales Telecopy No.: 212-623-6168
     or to such other address as such party shall specify by written notice to the other partieshereto. Any notice sent to Escrow Agent shall also be sent to the other parties to thisAgreement.
     16.   **Assignment; Successors and Assigns.** No party to this Agreement shallassign this Agreement or any part hereof without the prior written consent of the other parties.Subject to the foregoing, this Agreement shall bind and inure to the benefit of the parties heretoand their respective, heirs, personal representatives, successors and permitted assigns.
     17.   **Entire Agreement.** This Agreement, and with respect to the Acquirorand the Holder Representative, the Merger Agreement, embody the entire agreement and understandingof the parties concerning the Escrow Property, and, in the event of any inconsistency between thisAgreement and the Merger Agreement, this Agreement shall control.
     18.   **Amendments.** This Agreement may be amended only by a writing signed byeach of the parties hereto.
     19.   **Governing Law.** This Agreement shall be governed by and construed inaccordance with the laws of the State of New York, except the choice of law rules utilized in thatstate (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).
     20.   **Jurisdiction; Waiver of Jury Trial.** The parties hereto irrevocablysubmit to the non-exclusive jurisdiction of (i) the New York State Courts and (ii) the UnitedStates Court for the Southern District of New York for the purposes of any action arising out ofthis Agreement or any of the transactions contemplated hereby. The parties hereto further agreethat service of any process, summons, notice or document hand delivered or sent by U.S. registeredmail to such party’s respective address set forth in Section 8 shall be effective service ofprocess for any action in New York with respect to any matters to which it has submitted tojurisdiction as set forth in the immediately preceding sentence. The parties hereto irrevocablyand unconditionally waive any objection to the laying of venue of any action arising out of thisAgreement or the transactions contemplated hereby in (i) the New York State Courts or (ii) theUnited States District Court for the Southern District of New York, and hereby further irrevocablyand unconditionally waive and agree not to plead or claim in any such court that any such actionbrought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETOIRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHERBASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THETRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR THE ACTIONS OF THE PARTIES HERETO IN THENEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
     21.   **Captions; Counterparts.** The captions in this Agreement are forconvenience only and shall not be considered a part of or affect the construction or interpretationof any provision of this Agreement. This Agreement may be executed in two or more counterparts anddelivered via facsimile transmission, each of which shall be deemed an original, but all of whichtogether shall constitute one and the same instrument.
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     IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first abovewritten.      ENCORE MEDICAL CORPORATION