<PAGE>

                                                                   Exhibit 10.14

                           RESTRICTED STOCK AGREEMENT

     THIS RESTRICTED STOCK AGREEMENT (this "Agreement") is entered into
effective as of this 12th day of June, 2001, by and between ENCORE MEDICAL
CORPORATION, a Delaware corporation (the "Company"), and KATHY WIEDERKEHR
("Employee").

     WHEREAS, Employee has agreed to terminate the Severance Agreement that
Employee has with the Company in return for the Company selling Employee shares
of the common stock, $0.001 par value per share (the "Common Stock"), of the
Company pursuant to the terms of this Agreement;

     NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending legally to be bound, agree as follows:

     1.    Grant of Restricted Shares.  The Company hereby agrees to sell to
           --------------------------
Employee an aggregate of Thirty Thousand (30,000) shares (the
"Restricted Shares") of Common Stock on the terms and conditions hereinafter
set forth.

     2.    Purchase Price.  The purchase price of the Restricted Shares shall
           --------------
be One and 2/100 Dollars ($1.02) per share (the "Purchase Price").

     3.    Payment of Purchase Price.  The Purchase Price shall be paid as
           -------------------------
follows: (a) $30 shall be paid by cash or good check simultaneous with the
execution of this Agreement and (b) the remainder shall be paid by Employee
delivering to Company a secured promissory note payable to the Company in the
form attached hereto as Exhibit A.

     4.    Delivery of Shares.  Upon the payment of the Purchase Price by
           ------------------
Employee or as soon thereafter as is practicable, the Company shall issue and
deliver to Employee a certificate or certificates evidencing the number of
Restricted Shares.  Such certificate or certificates shall be registered in the
name of Employee and shall bear an appropriate investment warranty legend, any
legend required by any federal or state securities law, rule or regulation and,
if applicable, a legend referring to the restrictions provided hereunder.  Upon
the issuance and delivery of such certificate or certificates, Employee shall
have all the rights of a stockholder with respect to such Restricted Shares and
to receive all dividends or other distributions paid or made with respect
thereto; provided, however that such Restricted Shares shall be subject to the
restrictions hereunder.  Notwithstanding, such delivery, Company shall retain
possession of such certificates pursuant to the terms of the Security Agreement
attached hereto as Exhibit B.

     5.    Period of Restriction.
           ---------------------

          (a)  Subject to Paragraph 7, the Restricted Shares shall constitute
"Vested Shares" pro rata over a period of thirty-six (36) months, beginning one
month after the date of this Agreement.  Notwithstanding the foregoing
schedule, the Company may deem all or any portion of the Restricted Shares to
be Vested Shares whenever, in the Company's sole discretion, circumstances
warrant such action. Furthermore, should there be a "Change in Control" of the
Company as defined herein, then all remaining Restricted Shares shall be deemed
to be Vested Shares.

          (b)  "Unvested Shares" shall mean Restricted Shares which are not
Vested Shares in accordance with subparagraph (a) above.
<PAGE>

          (c)  Employee shall not sell, assign, transfer, pledge, gift or
otherwise dispose of any Unvested Shares, and no Unvested Shares shall be
transferred on the Company's books without the prior written consent of the
Company.

          (d)  "Change in Control" shall mean a change in control of a nature
that is reportable in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934 (the "Exchange Act") as
in effect on the date hereof; provided that, without limitation, such a change
in control shall be deemed to have occurred if any "person" (as such term is
used in Sections 13(d) and 14(d)(2) of the Exchange Act) is or becomes the
beneficial owner, directly or indirectly, of securities of the Company
representing a majority or more of the combined voting power of the Company's
then outstanding securities.

          (e)  In the event Employee shall voluntarily leave the employment of
the Company or be terminated for cause, then Employee shall be required,
effective as of the last day of employment, to sell any remaining Restricted
Shares to the Company at a price per share equal to the Purchase Price.
Termination 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 any employment agreement
that the Employee has with the Company after ten (10) days prior written notice
of such material breach and failure to cure such breach.  Employee shall be
deemed to have been terminated 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.

     6.    Shares Not Transferable.  As a condition to the issuance of
           -----------------------
Restricted Shares, the Company may require an opinion of counsel and/or a
representation letter from the purchaser(s) of such shares, satisfactory to the
Company, to the effect that such transfer will not be in violation of the
Securities Act of 1933, as amended (the "Securities Act"), or any other
applicable securities laws or that such transfer has been registered under the
Securities Act and the Company shall not be liable for damages due to delay in
the delivery or issuance of any stock certificates representing Restricted
Shares purchased hereunder for any reason whatsoever, including, but not
limited to, a delay caused by listing requirements of any securities exchange
or any registration requirements under the Securities Act, the Securities
Exchange Act of 1934, as amended, or under any other state or federal law, rule
or regulation.  The Company is under no obligation to take any action or to
incur any expense to register or qualify the delivery or transfer Restricted
Shares under applicable securities laws or to perfect any exemption from such
registration or qualification.  Furthermore, the Company will have no liability
to Employee for refusing to deliver or transfer Restricted Shares purchased
hereunder if such refusal is based upon the foregoing provisions of this
Paragraph 6.

     7.    Benefit.  This Agreement shall be binding upon and shall inure to
           -------
the benefit of the successors, assigns, legal representatives, heirs, legatees,
executors and administrators of the respective parties hereto.

     8.    Modifications.  This Agreement may be altered or amended, in whole
           -------------
or in part at any time only by written instrument signed by the Company and
Employee setting forth such changes.

     9.    Entire Agreement.  This Agreement contains the entire agreement
           ----------------
between the parties with respect to the subject matter described herein, and no
waiver of any of the terms of this Agreement shall be valid unless signed by
the party against whom such waiver is asserted.

                                      -2-
<PAGE>

     10.   Severability.  Should any one or more of the provisions hereof be
           ------------
determined to be illegal or unenforceable, all of the other provisions hereof
shall be given effect separately therefrom and shall not be affected thereby.

     11.   Notices.  Any notice or other written instrument required or
           --------
permitted to be given, made or sent hereunder shall be in writing, signed by
the party giving or  making the same and shall be sent by United States Mail,
registered or certified, with postage prepaid, to the addresses set forth below:

                If to Company:                Encore Medical Corporation
                                              9800 Metric Blvd.
                                              Austin, Texas 78758

                If to Employee:               Kathy Wiederkehr
                                              11501 Cherry Hearst
                                              Austin, TX 78750

     Either party hereto shall have the right to change the place to which any
such notice or other written instrument shall be sent by a similar notice sent
in like manner to the other party hereto.  The date of mailing of any notice or
other written instrument shall be deemed to be the date of such notice or
instrument and shall be effective from such date.

     12.   Governing Laws.  THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
           --------------
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS (EXCLUSIVE OF CONFLICTS OF LAW
PRINCIPLES) AND WILL, TO THE MAXIMUM EXTENT PRACTICABLE, BE DEEMED TO CALL FOR
PERFORMANCE IN TRAVIS COUNTY, TEXAS.

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

                                                   COMPANY:

                                                   ENCORE MEDICAL CORPORATION

                                                   By:  /s/ Kenneth W. Davidson
                                                        -----------------------
                                                         Kenneth W. Davidson,
                                                          CEO and President

                                                   EMPLOYEE:
                                                   /s/ Kathy Wiederkehr
                                                   ----------------------------
                                                   KATHY WIEDERKEHR

                                       -3-
<PAGE>

                                    EXHIBIT A

                             Form of Promissory Note

                                 PROMISSORY NOTE
                                 ---------------

Austin, Texas                                                _____, 2001

     PROMISE TO PAY:  For value received, the undersigned, _________ (herein
the "Issuer"), promises to pay to the order of Encore Medical Corporation, a
Delaware corporation, or its successors or assigns (herein the "Payee"), the
Principal Amount (as defined below) in lawful money of the United States of
America, in accordance with all the terms, conditions, and covenants of this
Note.

     ISSUER'S ADDRESS FOR NOTICE:  __________________________________________.

     PAYEE'S ADDRESS FOR PAYMENT:  9800 Metric Blvd., Austin, Texas 78758.

     PRINCIPAL AMOUNT:  _______________ ($_________).

     INTEREST RATE:  Eight percent (8%) per annum

     PAYMENT TERMS:  Issuer shall pay the principal amount of ________ in
lawful money of the United States, with interest, on the _____  day of _____,
2011.  Interest shall be due on a monthly basis on the first day of each month
beginning _____  1, 2001.  Issuer shall bear full recourse for the principal
amount of this Note.  Notwithstanding the prior, upon the sale by Issuer of any
Shares (as defined in the Pledge Agreement (as defined below)), Issuer shall
make a prepayment on this Note equal to the product of (i) the number of Shares
sold, multiplied by (ii) $1.02 per Share.

     Issuer may prepay all or any part of this Note without penalty or premium.
Issuer's payments shall be applied on the first business day after Payee's
receipt of such payments.

     1.    Default Provisions:

           (a)  Events Of Default And Acceleration Of Maturity:  PAYEE MAY,
                ----------------------------------------------
WITHOUT NOTICE OR DEMAND (except as otherwise required by statute or otherwise
specifically provided in this Note or the Pledge Agreement), ACCELERATE THE
MATURITY OF THIS NOTE AND DECLARE THE ENTIRE UNPAID PRINCIPAL BALANCE AT ONCE
DUE AND PAYABLE IF:

                (i)    There is default by Issuer in the performance of any
covenant, condition, or agreement contained in this Note or the Pledge
Agreement, including any instrument securing the payment of this Note, and such
default continues for a period of thirty (30) days following written notice to
Issuer specifying such default;

                (ii)   if Issuer makes an assignment for the benefit of
creditors, or petitions or applies for the appointment of a liquidator,
receiver or custodian (or similar official) of it or of any substantial part of
its assets, or if Issuer commences any proceeding or case relating to it under
the Bankruptcy Code or any other bankruptcy, reorganization, arrangement,
insolvency, readjustment of debt, dissolution or liquidation or similar law of
any jurisdiction, or takes any action to authorize any of the foregoing; or

                                    -4-
<PAGE>

                (iii)  if any petition or application of the type described in
subparagraph (c) immediately above is filed or if any such proceeding or case
described in subparagraph (c) is commenced against Issuer and is not dismissed
within sixty (60) days, or if Issuer indicates its approval thereof, consents
thereto or acquiesces therein, or if an order is entered appointing any such
liquidator or receiver or custodian (or similar official), or adjudicating
Issuer bankrupt or insolvent, or approving a petition in any such proceeding,
or if a decree or order for relief is entered in respect of Issuer in an
involuntary case under the Bankruptcy Code or any other bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction.

          (b)  Waiver By Issuer:  ISSUER WAIVES DEMAND, NOTICE OF INTENT TO
               ----------------
DEMAND, PRESENTMENT FOR PAYMENT, NOTICE OF NONPAYMENT, PROTEST, NOTICE OF
PROTEST, GRACE, NOTICE OF DISHONOR, NOTICE OF INTENT TO ACCELERATE MATURITY,
AND DILIGENCE IN COLLECTION.

          (c)  Non-Waiver by Payee:  Any previous extension of time,
               -------------------
forbearance, failure to pursue some remedy, acceptance of late payments, or
acceptance of partial payment by Payee, before or after maturity, does not
constitute a waiver by Payee of its subsequent right to strictly enforce the
collection of this Note according to its terms.

          (d)  Other Remedies Not Required:  Payee shall not be required to
               ---------------------------
first file suit, exhaust all remedies, or enforce its rights against any
security in order to enforce payment of this Note.

          (e)  Attorney's Fees:  If Payee requires the services of an attorney
               ---------------
to enforce the payment of this Note or the performance of the Pledge Agreement,
or if this Note is collected through any lawsuit, probate, bankruptcy, or other
judicial proceeding, Issuer agrees to pay Payee an amount equal to its
reasonable attorney's fees and other reasonable collection costs.  This
provision shall be limited by any applicable statutory restrictions relating to
the collection of attorney's fees.

     2.   Miscellaneous Provisions:

          (a)  Successors and Assigns:  The provisions of this Note shall be
               ----------------------
binding upon the successors and assigns of Issuer, and shall inure to the
benefit of the successors and assigns of Payee; provided, however, that no
obligations of Issuer hereunder can be assigned without Payee's prior written
consent.

          (b)  No Duty or Special Relationship:  Issuer acknowledges that Payee
               -------------------------------
has no duty of good faith to Issuer, and Issuer acknowledges that no fiduciary,
trust, or other special relationship exists between Payee and Issuer; provided,
however, the foregoing is not intended to abrogate any duties which may exist
as the result of that Payee having been a director and executive officer of the
Issuer.  If Payee and Issuer are now engaged in or in the future engage in
other business transactions, such other business transactions are independent
of this Note and the indebtedness evidenced hereby and of the promises and
covenants made by Issuer in this Note, and vice versa.

          (c)  Security.  This Note is secured by a security interest in
               --------
certain shares of common stock of Payee issued to Issuer, as granted by that
certain Pledge and Security Agreement, of even date herewith, by and between
Issuer and Payee (the "Pledge Agreement").

          (d)  Entire Agreement.  Issuer warrants and represents to Payee that
               ----------------
this Note and the Pledge Agreement constitute the entire agreement between
Issuer and Payee with respect to the indebtedness evidenced by this Note and
agrees that no modification, amendment, or additional

                                     -5-
<PAGE>

agreement with respect to such indebtedness will be valid and enforceable
unless made in writing signed by both Issuer and Payee.

          (e)  Issuer's Address for Notice:  All notices required to be sent by
               ---------------------------
Payee to Issuer shall be sent by U.S. Mail, postage prepaid, to Issuer's
Address for Notice stated on the first page of this Note, until Payee shall
receive written notification from Issuer of a new address for notice.

          (f)  Payee's Address for Payment:  All sums payable by Issuer to
               ---------------------------
Payee shall be paid at Payee's Address for Payment stated on the first page of
this Note, or at such other address as Payee shall designate from time to time.

          (g)  Partial Invalidity:  The unenforceability or invalidity of any
               ------------------
provision of this Note shall not affect the enforceability or validity of any
other provision herein, and the invalidity or unenforceability of any provision
of this Note or of the Pledge Agreement as to any person or circumstance shall
not affect the enforceability or validity of such provision as it may apply to
other persons or circumstances.

          (h)  Applicable Law; Venue and Jurisdiction:  This Note has been
               --------------------------------------
executed and delivered in Texas and shall be construed in accordance with the
applicable laws of the State of Texas and the laws of the United States of
America applicable to transactions in Texas and venue for any action concerning
this Note shall be exclusively in Travis County, Texas.

     EXECUTED as of the date first set forth above.

                                                        ________________________

                                      -6-
<PAGE>

                                   EXHIBIT B

                          Form of Security Agreement

                         PLEDGE AND SECURITY AGREEMENT
                         -----------------------------

     This Pledge and Security Agreement ("Agreement") is made and entered into
as of the _____  day of _____, 2001 by and between Encore Medical Corporation,
a Delaware corporation ("Secured Party"), and _______ ("Debtor").

                                       1.
                       COLLATERAL AND SECURED INDEBTEDNESS

     Section 1.1   Grant of Security Interest.  Debtor hereby assigns and
                   --------------------------
pledges to Secured Party, and hereby grants to Secured Party a security
interest in the following (hereinafter collectively called the "Collateral"):

          (a) ________ shares (the "Shares") of the common stock, par value
$0.001 per share, owned by Debtor of Secured Party, as evidenced by a
certificate delivered to Secured Party simultaneously with the execution of
this Agreement; and all distributions, fees, dividends, preferences, payments
and other benefits which Debtor is now and may hereafter be entitled to receive
with respect to such shares; and all proceeds (cash and non-cash) arising out
of the sale, exchange, collection or other disposition of all or any portion of
the Shares.  In the event that Debtor receives any additional shares of capital
stock of Secured Party by way of a stock split or stock dividend, the Debtor
shall promptly deliver to the Secured Party certificates evidencing such shares
along with appropriate stock powers duly endorsed in blank.

     Section 1.2   Secured Obligations.  This Agreement and the security
                   -------------------
interest herein created shall secure full and punctual payment and performance
of the following indebtedness, duties and obligations (hereinafter collectively
called the "Secured Obligations"):

          (a)  All principal, fees and other amounts payable to the Secured
Party pursuant to the terms and provisions of that certain Promissory Note of
even date herewith issued by Debtor to Secured Party in the original principal
amount of $___________ (the "Note"), including all extensions, renewals,
modifications, increases or substitutions thereof; and

          (b)  All charges, expenses, attorney's and other legal fees and any
other sums incurred by Secured Party in connection with the enforcement of
Secured Party's rights and remedies hereunder.

                                      2.
                        REPRESENTATIONS AND WARRANTIES;
                              FURTHER ASSURANCES

     Section 2.1   Representations and Warranties.  Debtor hereby represents and
                   ------------------------------
warrants to Secured Party as follows:

          (a)  Debtor has good and marketable title to the Collateral free
and clear of any lien, security interest, shareholders agreement, calls, charge
or encumbrance, except for the security interest created by this Agreement
in favor of the Secured Party.  No financing statement or other instrument

                                    -7-
<PAGE>

similar in effect covering all or any part of the Collateral is on file in
any recording office, except as may have been filed in favor of Secured Party
relating to this Agreement.

          (b)  Debtor has the lawful right, power and authority to grant a
security interest in the Collateral.  This Agreement, together with all filings
and other actions necessary or desirable to perfect and protect such security
interest, which have been duly taken, create a valid and perfected first
priority security interest in the Collateral securing the payment and
performance of the Secured Obligations.

                                       3.
                         PARTIAL RELEASE OF COLLATERAL

     Upon the delivery to the Secured Party by Debtor of a written notice
requesting that a specified number of shares representing the Collateral be
released from this Agreement, and either (i) Debtor delivers to Secured Party
cash in the amount of $1.02 multiplied by the number of Shares to be released;
or (ii) Debtor provides assurances acceptable to the Secured Party that the
Shares that are to be released will be sold through a broker acceptable to the
Secured Party, and such broker unconditionally and irrevocably undertakes to
deliver to the Secured Party a portion of the proceeds from such sale equal to
the amount set forth in (i), the Secured Party shall release from the security
interest granted herein the number of Shares specified in the notice.  The
amount set forth in subpart (i) of the preceding sentence will be applied to
the outstanding principal balance of the Note as provided therein.  Such
release of any shares from the security interest created in this Agreement
shall not affect Secured Party's security interest in any other Collateral.

                                       4.
                              DEFAULT AND REMEDIES

     Section 4.1   Events of Default.  An Event of Default (herein so called)
                   -----------------
shall exist upon the failure of Debtor to make when due any scheduled payment
under the Note or any other Secured Obligations.

     Section 4.2   Remedies of Secured Party.  Upon the occurrence of an Event
                   -------------------------
of Default:

             (a)  Secured Party may, without notice or demand, accelerate the
maturity of the Note and declare the entire unpaid principal balance at once
due and payable.

             (b)  Secured Party may, at Secured Party's option and at the
expense of Debtor, either in Secured Party's own right or in the name of Debtor
and in the same manner and to the same extent that Debtor might reasonably so
act if this Agreement had not been made,

                  (i)   do all things requisite, convenient, or necessary to
             enforce the performance and observance of all rights, remedies and
             privileges of Debtor arising from the Collateral, or any part
             thereof, including, but not limited to, compromising, waiving,
             excusing, or in any manner releasing or discharging any obligation
             of any party to or arising from the Collateral;

                  (ii)  sue or otherwise collect and receive money attributable
             to the Collateral; and

                  (iii) exercise any other lawfully available powers or
             remedies, and do all other things which Secured Party deems
             requisite, convenient or necessary or which the Secured Party
             deems proper to protect the security interest herein granted.

                                     -8-
<PAGE>

             (c)  Secured Party may foreclose this Agreement in the manner now
or hereafter provided or permitted by law and shall have the immediate right to
receivership pending foreclosure, and may upon such reasonable notification
prior thereto as may be required by applicable law (Debtor hereby agreeing that
10 days notice is commercially reasonable), sell, assign, transfer or otherwise
dispose of the Collateral at public or private sale, in whole or in part, and
Secured Party may, in its own name or as the irrevocably appointed
attorney-in-fact of Debtor effectively assign and transfer the Collateral, or
any part thereof, absolutely, and execute and deliver all necessary assignments,
conveyances, bills of sale and other instruments with power to substitute one or
more persons or corporations with like power.  Any such foreclosure sale,
assignment, or transfer shall, to the extent permitted by law, be a perpetual
bar, both at law and in equity, against Debtor and all persons and corporations
lawfully claiming by or through or under Debtor.

             (d)  Any such foreclosure sale may be adjourned from time to time
provided that at least ten days notice of the continuation of such sale is given
to Debtor.  Upon any sale, Secured Party may bid for and purchase the
Collateral, or any part thereof, and upon compliance with the terms of sale may
hold, retain, possess and dispose of the Collateral, in its absolute right
without further accountability.  Secured Party shall have the right to be
credited on the amount of its bid a corresponding amount of the Secured
Obligations as of the date of such sale.

     Section 4.3    Application of Proceeds. Except as otherwise required by
                    -----------------------
applicable law, Secured Party may apply the proceeds of any foreclosure sale
hereunder as follows:

             (a)  first, to the payment of all costs and expenses of any
foreclosure and collection hereunder and all proceedings in connection
therewith, including reasonable attorneys' fees;

             (b)  then, to the reimbursement of Secured Party for all
disbursements made by Secured Party for taxes, assessments or liens superior to
the security interest hereof and which Secured Party shall deem expedient to pay
in order to protect its interest in the Collateral;

             (c)  then, to the reimbursement of Secured Party of any other
disbursements made by Secured Party in accordance with the terms hereof;

             (d)  then, to or among the amounts of fees and principal then
outstanding and unpaid in respect of the Secured Obligations, in such priority
as Secured Party may determine in its discretion; and

             (e)  the remainder of such proceeds, if any, shall be paid to the
record owner of the Collateral.

     Section 4.4    Enforcement of Secured Obligation. Nothing in this
                    ---------------------------------
Agreement or in any other agreement shall affect or impair the unconditional
and absolute right of the Secured Party to enforce the Secured Obligations as
and when the same shall become due in accordance with the terms of the Note or
other documents evidencing the Secured Obligations.

                                     -9-
<PAGE>

                                      5.

                            RIGHTS OF SECURED PARTY

     Section 5.1    Subrogation. Upon the occurrence of an Event of Default,
                    -----------
Secured Party, at its election, may subrogate to all of the interest, rights and
remedies of Debtor, in respect to any of the Collateral or agreements pertaining
thereto.

     Section 5.2    Secured Party Appointed Attorney-in-Fact. Debtor hereby
                    ----------------------------------------
irrevocably appoints Secured Party as attorney-in-fact of Debtor, with full
authority in the place and stead of Debtor and in the name of Debtor, Secured
Party or otherwise, from time to time on Secured Party's discretion and upon the
occurrence of an Event of Default, to take any action and to execute any
instrument which Secured Party may deem necessary or advisable to accomplish the
purposes of this Agreement, including without limitation:  (a) to ask, demand,
collect, sue for, recover, compound, receive and give acquittance and receipts
for moneys due and to become due under or in respect of any of the Collateral;
and (b) to assign and transfer the Collateral, or any part thereof, absolutely
and to execute and deliver endorsements, assignments, conveyances, bills of sale
and other instruments with power to substitute one or more persons or
corporation with like power.

     Section 5.3    Performance by Secured Party. If Debtor fails to perform
                    ----------------------------
any agreement contained herein, Secured Party may itself perform, or cause the
performance of, such agreement, and the reasonable expenses of Secured Party
incurred in connection therewith shall be payable by Debtor under Section 5.8.
In no event, however, shall Secured Party have any obligation or duties
whatsoever to perform any covenant or agreement of Debtor contained herein, and
any such performance by Secured party shall be wholly discretionary with Secured
Party.

     Section 5.4    Duties of Secured Party. The powers conferred upon Secured
                    -----------------------
Party hereunder are solely to protect its interest in the Collateral and shall
not impose any duty upon it to exercise any such powers.  Except for the safe
custody of any Collateral in its possession and the accounting for money
actually received by it hereunder, Secured Party shall have no duty as to any
Collateral or as to the taking of any necessary steps to preserve rights against
prior parties or any other rights pertaining to any Collateral.

     Section 5.5    No Liability of Secured Party.  Neither the acceptance of
                    -----------------------------
this Agreement by Secured Party, nor the exercise of any rights hereunder by
Secured Party, shall be construed in any way as an assumption by Secured Party
of any obligations, responsibilities or duties of Debtor arising in connection
with the Collateral assigned hereunder or otherwise bind Secured Party to the
performance of any obligations respecting the Collateral, it being expressly
understood that Secured Party shall not be obligated to perform, observe or
discharge any obligation, responsibility, duty, or liability of Debtor in
respect of any of the Collateral, including, but not limited to, appearing in or
defending any action, expending any money or incurring any expense in connection
therewith.

     Section 5.6    Right of Secured Party to Defend Action Affecting Security.
                    ----------------------------------------------------------
Secured Party may, at the expense of Debtor, appear in and defend any action or
proceeding at law or in equity purporting to affect Secured Party's security
interest under this Agreement.

     Section 5.7    Right of Secured Party to Prevent or Remedy Default. If
                    ---------------------------------------------------
Debtor shall fail to perform any of the covenants, conditions and agreements
required to be performed and observed by Debtor in respect of the Collateral,
Secured Party (a) may but shall not be obligated to take any action Secured
Party deems necessary or desirable to prevent or remedy any such default by
Debtor or otherwise to protect the security interest of Secured Party under this
Agreement, and (b) shall have the absolute and

                                     -10-
<PAGE>

immediate right to take possession of the Collateral or any part thereof (to
the extent Secured Party has not previously taken possession) to such extent
and as often as the Secured Party, in its sole discretion, deems necessary or
desirable in order to prevent or to cure any such default by Debtor, or
otherwise to protect the security of this Agreement.  Secured Party may advance
or expend such sums of money for the account of Debtor as Secured Party in its
sole discretion deems necessary for any such purpose.

     Section 5.8    Secured Party's Expenses. All reasonable advances, costs,
                    ------------------------
expenses, charges and attorneys' fees which Secured Party may make, pay or incur
under any provision of this Agreement for the protection of its security or for
the enforcement of any of its rights hereunder, or in foreclosure proceedings
commenced and subsequently abandoned, or in any dispute or litigation in which
Secured Party or the holder of any of the Secured Obligations may become
involved by reason of or arising out of the Note or other Secured Obligations or
the Collateral shall be a part of the Secured Obligations and shall bear
interest until paid at the rate chargeable on the  Note but not to exceed the
maximum rate of interest permitted by applicable law, from the date of such
payment until repaid by Debtor.

     Section 5.9    No Waiver. In case Secured Party shall have proceeded to
                    ---------
enforce any right or remedy hereunder and such proceedings shall have been
discontinued or abandoned for any reason, then in every such case, Debtor and
Secured Party shall be restored to their former positions and rights hereunder
with respect to the Collateral, and all rights, remedies and powers of Secured
Party shall continue as if no such proceeding had been taken.  No failure or
delay on the part of Secured Party in exercising any right, remedy or power
under this Agreement or in giving or insisting upon strict performance by Debtor
hereunder or in giving notice hereunder shall operate as a waiver of the same or
any other power or right, and no single or partial exercise of any such power or
right shall preclude any other or further exercise thereof or the exercise of
any other such power or right.  Secured Party, notwithstanding any such failure,
shall have the right thereafter to insist upon the strict performance by Debtor
of any and all of the terms and provisions of this Agreement to be performed by
the Debtor.  The collection and application of proceeds, the entering and taking
possession of the Collateral, and the exercise of the rights of Secured Party
contained in this Agreement, shall not cure or waive any default, or affect any
notice of default, or invalidate any acts done pursuant to such notice.   No
waiver by Secured Party of any breach or default of or by any party hereunder
shall be deemed to alter or affect Secured Party's rights hereunder with respect
to any prior or subsequent default.

     Section 5.10    Remedies. No right or remedy herein reserved to Secured
                     --------
Party is intended to be exclusive of any other right or remedy, but each and
every such remedy shall be cumulative, not in lieu of, but in addition to any
other rights or remedies given under this Agreement and all other security
documents.  Any and all of Secured Party's rights and remedies may be exercised
from time to time and as often as such exercise as deemed necessary or desirable
by Secured Party.

     Section 5.11    Right of Secured Party to Extend Time of Payment,
                     -------------------------------------------------
Substitute, Release Security, Etc. Without affecting the liability of any
---------------------------------
person, including Debtor, for the payment of any of the Secured Obligations or
the lien of this Agreement on the Collateral, or the remainder thereof, for the
full amount of any indebtedness unpaid, Secured Party may from time to time,
without notice or without affecting or impairing any of Secured Party's rights
under this Agreement:  (a) release any person liable for the payment of any of
such indebtedness, (b) extend the time or otherwise alter the terms of payment
of any of such indebtedness, (c) accept additional security therefor of any
kind, including deeds of trust or mortgages, (d) alter, substitute or release
any property securing the Secured Obligations, (e) resort for the payment of all
or any portion of the Secured Obligations to its several securities therefor in
such order and manner as it may deem fit, or (f) join in any subordination or
other agreement affecting this Agreement or the lien or charge
thereof.

                                     -11-
<PAGE>

     Section 5.12  Dividends.  Upon the occurrence of an Event of Default,
                   ---------
Secured Party shall be entitled to any dividends, fees, receipts, payments or
other disbursements, attributable in any way to the Collateral.  Debtor shall
take all actions necessary to cause the payor of such disbursements to make
such disbursements directly to Secured Party on account of Debtor.  Such
amounts, when received by Debtor, will be applied to the outstanding balance of
the Note or the other Secured Obligations, as determined by Secured Party.  At
all times during the term of this Agreement, Secured Party will be entitled to
all stock dividends and proceeds of the Collateral.

     Section 5.13  Delivery of Certificates.  Simultaneously with the execution
                   ------------------------
of this Agreement, Debtor shall deliver to Secured Party all certificates or
other documentation evidencing the Collateral, along with such endorsements or
stock powers as the Secured Party may request.  In the event that Debtor
receives any certificates evidencing the Collateral, Debtor shall within three
days of receipt, deliver such certificates to Secured Party along with
appropriate stock powers executed in blank.

                                       6.
                                 MISCELLANEOUS

     Section 6.1   Terms Commercially Reasonable.  The terms of this Agreement
                   -----------------------------
shall be deemed commercially reasonable within the meaning of the Uniform
Commercial Code in effect and applicable hereto.

     Section 6.2   Notices.  Any notices or demands required or permitted to be
                   -------
given hereunder shall be deemed sufficiently given if in writing and personally
delivered or mailed by registered or certified mail, return receipt requested
(with all postage and charges prepaid), addressed as follows:

              To Secured Party:              Encore Medical Corporation
                                             9800 Metric Blvd.
                                             Austin, Texas  78758
                                             Attn:  Chairman of the Board

              Debtor:                        ____________________________
                                             ____________________________
                                             ____________________________

or at such other address as the above parties may from time to time designate
by written notice to the other given in accordance with this Section 6.2.  Any
such notice, if personally delivered shall be deemed to have been given on the
date so delivered or, if mailed, be deemed to have been given on the third day
after such notice is placed in the United States mail in accordance with this
Section 6.2.

     Section 6.3   Definitions.  The terms "advances," costs," and "expenses "
                   -----------
shall include, but shall not be limited to, attorneys' fees whenever incurred.
The terms "indebtedness" and "obligations" shall mean and include, but shall
not be limited to, all claims, demands, obligations and liabilities whatsoever,
however arising, whether owing by Debtor individually or as a joint venturer, or
jointly or in common with any other party, and whether absolute or contingent,
and whether owing by Debtor as principal debtor or as accommodation maker or as
endorser, liquidated or unliquidated, and whenever contracted, accrued or
payable.  In this Agreement, whenever the context so requires, the neuter
gender includes the masculine and feminine, and the singular number includes
the plural and vice versa.

     Section 6.4   Paragraph Headings.  The headings of paragraphs herein are
                   -------------------
inserted only for convenience and shall in no way define, describe or limit the
scope of intent of any provisions of this Agreement.

                                    -12-
<PAGE>

     Section 6.5   Change, Amendment, Etc.  No change, amendment, modification,
                   -----------------------
cancellation or discharge of any provision of this Agreement shall be valid
unless consented to in writing by Secured Party.

     Section 6.6   Assignment of Secured Party's Interest.  Secured Party shall
                   --------------------------------------
have the right to assign all or any portion of its rights in this Agreement to
any subsequent holder of the Note or other instrument evidencing the Secured
Obligations.

     Section 6.7   Parties in Interest.  As and when used herein, the term
                   -------------------
"Debtor" shall mean and include the Debtor herein named and its successors and
permitted assigns, and the term "Secured Party" shall mean and include the
Secured Party herein named and its successors and assigns, and all covenants
and agreements herein shall be binding upon and inure to the benefit of Debtor,
Secured Party and their respective successors and permitted assigns.

     Section 6.8   Applicable Laws.  This Agreement shall be construed,
                   ---------------
interpreted and enforceable under and pursuant to the laws of the State of
Texas.  If any provision of this Agreement is held to be invalid or
unenforceable, the validity or enforceability of the other provisions of this
Agreement shall remain unaffected.

     Section 6.9   Counterparts.  This Agreement may be executed in two or more
                   ------------
counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same instrument, and in making proof of this
Agreement it shall not be necessary to produce or account for more than one
such counterpart.

     IN WITNESS WHEREOF, Debtor and Secured Party have executed these presents
on the day and year first above written.

                                  DEBTOR:
                                  -------

                                  ______________________________

                                  SECURED PARTY:
                                  --------------
                                  ENCORE MEDICAL CORPORATION

                                  By:  ________________________________________
                                         Kenneth W. Davidson, CEO and President

                                      -13-