Exhibit 10.4


 


EXECUTION COPY


 


TERM
SHEET FOR KENNETH W. DAVIDSON

CHAIRMAN OF THE BOARD OF DJO INCORPORATED


 




	
  Parties:

  	
   

  	
  ReAble Therapeutics, Inc.,
  a Delaware corporation which, following the consummation of certain
  transactions set forth in the Agreement and Plan of Merger, dated July 15,
  2007, intends to change its name to “DJO Incorporated” (the “Company”), and Kenneth W. Davidson (the
  “Director”).

  
	
   

  	
   

  	
   

  
	
  Service Period:

  	
   

  	
  The Director shall serve as the Chairman of the
  Company’s Board of Directors (the “Board”) until the next annual meeting of
  the Company’s stockholders at which time the stockholders may elect the
  Director to serve for an additional term. The Director may be removed at any
  time with or without cause by the Company’s stockholders as set forth under
  the Delaware General Corporation Law or as provided in the Company’s
  Certificate of Incorporation.

  
	
   

  	
   

  	
   

  
	
  Position and Duties:

  	
   

  	
  To serve as the Chairman of the Board. The duties,
  responsibilities and obligations of the Director are as established by law,
  the Certificate of Incorporation and Bylaws of the Company, the Corporate
  Governance Guidelines, Committee Charters and other governance procedures and
  policies established by the Company from time to time.

  
	
   

  	
   

  	
   

  
	
  Annual Retainer:

  	
   

  	
  For each annual term commencing on or after January
  1, 2008 that the Director is elected to serve on the Board, the Director will
  be paid an annual retainer as set forth on Exhibit A, payable in 4
  equal installments on the date of each regularly scheduled quarterly Board
  meeting. No annual retainer shall be paid for Board membership in 2007.

  
	
   

  	
   

  	
   

  
	
  Travel Expenses:

  	
   

  	
  The Director will be reimbursed for all reasonable
  travel and lodging expenses associated with attendance at Board, subject to
  the policies of the Company in effect from time to time.

  
	
   

  	
   

  	
   

  
	
  Equity Grant:

  	
   

  	
  The Director will be granted annual equity awards,
  in the form to be determined by the Company, as set forth on Exhibit A.
  The first equity award will be granted January 1, 2008 and a similar grant
  shall be made on each following January 1 during this term on the Board.

  
	
   

  	
   

  	
   

  
	
  Termination of Service:

  	
   

  	
  All annual retainers, equity awards and expense
  reimbursements will cease and all unvested equity awards, if any, shall be
  forfeited upon the termination of the Director’s membership on the Board for
  any reason whatsoever.

  
	
   

  	
   

  	
   

  
	
  Director’s Covenants:

  	
   

  	
  During the period the Director serves on the Board
  and thereafter, the Director will not disclose or otherwise use any
  confidential information or trade secrets of the Company, its subsidiaries
  and affiliates. “Confidential Information,” shall mean any information
  regarding the business methods, business policies, policies, procedures,
  techniques, research or development projects or results, historical or
  projected financial information, budgets, trade secrets, or other knowledge
  or processes of or developed by the Company or any names and addresses of
  customers or clients or any data on or relating to past, present or
  prospective Company customers or clients or any other confidential
  information relating to or dealing with the business operations or activities
  of the Company, made known to the Director or learned or acquired by the
  Director while associated with the Company, excepting information otherwise
  lawfully known 

  






 

















 


 


	
   

  	
   

  	
   

  
	
   

  	
   

  	
  generally by or readily accessible to the general
  public.

  
	
   

  	
   

  	
   

  
	
  Governing Law:

  	
   

  	
  The provisions of this Term Sheet shall be governed
  by the laws of the State of New York, without regard to any choice of law
  provisions.

  



 


[Signature
Page Follows]


 


 

















 


 


	
  REABLE
  THERAPEUTICS, INC.

  	
  KENNETH
  W. DAVIDSON

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Harry L. Zimmerman

  	
   

  	
  /s/
  Kenneth W. Davidson

  	
   

  
	
   

  	
  HARRY
  L. ZIMMERMAN

  	
   

  
	
   

  	
   

  
	
  Date:
  

  	
  November
  20, 2007

  	
   

  	
  Date:
  

  	
  November
  20, 2007

  	
   

  
							



 


 


 


 


[Signature Page to Kenneth W. Davidson Board Term
Sheet]


 


 


 

















 


 


Exhibit A


 


Certain
Terms and Conditions of Service


	
  Name:

  	
   

  	
  Kenneth W. Davidson

  
	
   

  	
   

  	
   

  
	
  Position:

  	
   

  	
  Chairman of the Board;
  Non-employee Director of the Company

  
	
   

  	
   

  	
   

  
	
  Annual Retainer for
  membership on Board:

  	
   

  	
  $60,000

  
	
   

  	
   

  	
   

  
	
  Annual Equity Award

  	
   

  	
  Annual grant of options
  to acquire the Company’s stock valued at approximately $25,000 (not to exceed
  1,500 shares per grant), with the exercise prices to be set at the fair
  market value of the stock on the date of option grant). One-third of the
  shares subject to each annual option grant shall vest on the first
  anniversary of such grant, and one-third of the shares subject to such annual
  option grant shall vest on each of the next two following anniversaries of
  such annual option grant, provided the Director continues to serve on the Board.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The options shall have
  restrictions on transfer, and the options and the shares subject to such
  options shall be subject to certain call rights, drag-along and tag-along
  rights, and registration rights similar to those included in the Management Stockholders
  Agreement that has been entered into between the Company and its senior
  management.