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                                                                    EXHIBIT 10.3

                          CONCENTRA MANAGED CARE, INC.
              1999 STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN

                       (As amended through June 20, 2002)

         Section 1. Purpose. The purpose of the Concentra Managed Care, Inc.
1999 Stock Option and Restricted Stock Purchase Plan (the "Plan") is to promote
the interests of Concentra Managed Care, Inc., a Delaware corporation (the
"Company"), and any Subsidiary thereof and the interests of the Company's
stockholders by providing an opportunity to selected Employees, Consultants and
Non-Employee Directors of the Company to purchase Common Stock of the Company,
thereby enhancing the Company's ability to attract, retain, motivate and
encourage such persons to devote their best efforts to the business and
financial success of the Company. It is intended that this purpose will be
effected by awards of Non-Qualified Stock Options, Incentive Stock Options,
Restricted Stock, and/or Unrestricted Stock.

         Section 2. Definitions. For purposes of the Plan, the following terms
used herein have the following meanings, unless a different meaning is clearly
required by the context:

         2.1. "Administrator" means the Board of Directors or any Committees
that shall be administering the Plan in accordance with Section 4 hereof.

         2.2. "Annual Option" means a Non-Qualified Stock Option granted to a
Non-Employee Director on the next business day following each annual meeting of
stockholders at which such Non-Employee Director is elected as a Director, other
than the annual meeting of stockholders at which such Non-Employee Director is
initially elected a Director.

         2.3. "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under state corporate laws, federal and
state securities laws and the Code.

         2.4. "Award" means any award of an Option or Stock under the Plan.

         2.5. "Board of Directors" means the Board of Directors of the Company.

         2.6. "Code" means the Internal Revenue Code of 1986, as amended from
time to time.

         2.7. "Committee" means any committee appointed by the Board of
Directors in accordance with Section 4 of the Plan.

         2.8. "Common Stock" means the Common Stock, $.01 par value, of the
Company.

         2.9. "Consultant" means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary of the Company to render services and who
is compensated for such services; provided, that the term "Consultant" shall not
include Directors who are paid only a

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director's fee by the Company or who are not compensated by the Company for
their services as Directors.

         2.10. "Designated Beneficiary" means the beneficiary designated by a
Participant, in a manner determined by the Administrator, to receive amounts due
or exercise rights of the Participant in the event of the Participant's death.
In the absence of an effective designation by a Participant, Designated
Beneficiary shall mean the Participant's estate.

         2.11. "Director Option" means an Initial Option or an Annual Option.

         2.12 "Director" means any member of the Board of Directors.

         2.13. "Employee" means any person (including, without limitation, an
officer of the Company) who is employed by the Company or any Parent or
Subsidiary of the Company. Neither service as a Director nor payment of a
director's fee by the Company shall constitute "employment" by the Company.

         2.14. "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:

               (i)   If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the National
Market System of the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, the Fair Market Value of a share of Common Stock
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such system or exchange (or the exchange with the
greatest volume of trading in Common Stock) on the last market trading day prior
to the day of determination, as reported in the Wall Street Journal or such
other source as the Administrator deems reliable;

               (ii)  If the Common Stock is quoted on the NASDAQ System (but not
on the National Market System thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a share of Common Stock shall be the average between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in the Wall Street Journal or such other source as
the Administrator deems reliable; or

               (iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.

         2.15. "Incentive Stock Option" means an Option granted to a Participant
pursuant to Section 6 (including Section 6.7 thereof) which is intended to meet
the requirements of Section 422 of the Code or any successor provision.

         2.16. "Initial Option" means a Non-Qualified Stock Option granted
pursuant to Section 6.8 to a Non-Employee Director on the first business day
following his or her initial election to

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the Board of Directors.

         2.17. "Non-Employee Director" means a Director who is not an employee
of the Company or any Parent, Subsidiary or affiliate of the Company.

         2.18. "Non-Qualified Stock Option" means an Option granted to a
Participant pursuant to Section 6 that is not intended to be an Incentive Stock
Option.

         2.19. "Option" means any Incentive Stock Option or Non-Qualified Stock
Option.

         2.20. "Parent" of the Company shall have the meaning set forth in
Section 424(e) of the Code.

         2.21. "Participant" means any Employee, Consultant or Non-Employee
Director to whom an Award is granted under the Plan.

         2.22. "Restricted Period" means the period of time selected by the
Administrator during which shares subject to an Award of Restricted Stock may be
repurchased by or forfeited to the Company.

         2.23. "Reporting Person" means a Participant that is subject to Section
16(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").

         2.24. "Restricted Stock" means shares of Common Stock awarded to a
Participant under Section 7 subject to restrictions under the Plan.

         2.25. "Stock" means shares of Restricted Stock or Unrestricted Stock.

         2.26. "Subsidiary" of the Company means any corporation or other entity
(i) of which a majority of the voting securities is owned, directly or
indirectly, by the Company, or (ii) with which the Company, or any corporation
or other entity of which a majority of the voting securities is owned, directly
or indirectly, by the Company, has entered into any management, operating, or
similar agreement to manage or operate any portion of such other corporation's
or entity's business, operations, or assets.

         2.27. "Unrestricted Stock" means shares of Common Stock awarded to a
Participant under Section 7 free of any restrictions under the Plan.

         Section 3. Common Stock Subject to the Plan.

         3.1.  Number of Shares. The total number of shares of Common Stock for
which Awards may be granted under the Plan shall not exceed in the aggregate
5,250,000 shares of Common Stock (subject to adjustment as provided in Section
3.3 hereof). The Company, during the term of this Plan, will at all times
reserve and keep available such number of shares of Common Stock as shall be
sufficient to satisfy the requirements of the Plan.

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         3.2. Reissuance. The shares of Common Stock that may be subject to
Awards under the Plan may be either authorized and unissued shares or shares
reacquired at any time and now or hereafter held as treasury stock as the
Administrator may determine. In the event that any outstanding Option expires,
is terminated, forfeited or becomes unexercisable for any reason without having
been exercised in full, the shares allocable to the unexercised portion of such
Option may again be subject to an Award under the Plan, subject, in the case of
Incentive Stock Options, to any limitation required by the Code. If any shares
of Common Stock issued or sold pursuant to an Award of Stock or the exercise of
an Option shall have been repurchased by the Company, then such shares shall not
again be available for future grant or award under the Plan.

         3.3. Stock Dividends, Etc. In the event that the Administrator, in its
sole discretion, determines that any stock dividend, extraordinary cash
dividend, recapitalization, reorganization, merger, consolidation, split-up,
spin-off, combination or other similar transaction affects the Common Stock such
that an adjustment is required in order to preserve or prevent enlargement of
the benefits or potential benefits intended to be made available under the Plan,
then the Administrator, subject, in the case of Incentive Stock Options, to any
limitation required under the Code, may equitably adjust any or all of (i) the
number and kind of shares in respect of which Awards may be made under the Plan,
(ii) the number and kind of shares subject to outstanding Awards, and (iii) the
award, exercise or conversion price with respect to any of the foregoing, and if
considered appropriate, the Administrator may cause the number of shares subject
to any Award always to be a whole number.

         The Administrator may make Awards under the Plan in substitution for
stock and stock based awards held by employees of another corporation who
concurrently become employees of the Company as a result of a merger or
consolidation of the employing company with the Company or a Parent or
Subsidiary of the Company or the acquisition by the Company or a Parent or
Subsidiary of the Company of property or stock of the employing corporation. The
substitute Awards shall be granted on such terms and conditions as the
Administrator deems appropriate under the circumstances.

         Section 4. Administration of the Plan.

         4.1. Procedure.

              (a) Multiple Administrative Bodies. The Plan may be administered
by different Committees with respect to different groups of Participants.

              (b) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee consisting of two or more
Non-Employee Directors.

              (c) Rule 16b-3. To the extent that the Administrator determines it
to be desirable to qualify transactions hereunder as exempt under Rule 16b-3 of
the Exchange Act, the

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transactions contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.

              (d) Other Administration. Other than as provided above, the Plan
shall be administered by (i) the Board of Directors or (ii) a Committee, which
committee shall be constituted to satisfy Applicable Laws.

       4.2.   Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific powers delegated
by the Board of Directors to such Committee, the Administrator shall have the
authority, in its discretion:

              (a) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2.14 of the Plan;

              (b) to select the Employees and Consultants to whom Awards may be
granted hereunder;

              (c) to determine whether and to what extent awards of Options and
Stock, or any combination thereof, are granted hereunder;

              (d) to determine the number of shares of Common Stock to be
covered by each Award made hereunder;

              (e) to make determinations in accordance with Section 3.3;

              (f) to determine the amount (not less than par value per share)
and the form of the consideration that may be used to purchase shares of Common
Stock pursuant to any Award of Stock or upon exercise of any Option (including,
without limitation, the circumstances under which issued and outstanding shares
of Common Stock owned by a Participant may be used by the Participant to
exercise an Option);

              (g) to approve forms of agreements for use under the Plan;

              (h) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Award granted hereunder, including without
limitation, the exercise price, the time or times when Options may be exercised
(which may be based on performance criteria), any vesting, acceleration or
waiver of forfeiture restrictions and any restriction or limitation regarding
any Award or the shares of Common Stock relating thereto, based in each case on
such factors as the Administrator, in its sole discretion, shall determine;

              (i) to reduce the exercise price of any Option to the then current
Fair Market Value if the Fair Market Value of the Common Stock covered by such
Option shall have declined since the date the Option was granted;

              (j) to construe and interpret the terms of the Plan:

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              (k) to prescribe, amend and rescind rules and regulations relating
to the Plan;

              (l) to modify or amend the terms of any Award;

              (m) to accelerate vesting periods with respect to outstanding
Options and the end of Restricted Periods with respect to Stock Awards;
provided, however, that any Incentive Stock Options may only be "accelerated" in
accordance with Section 424(h) of the Code;

              (n) to authorize any person to execute on behalf of the Company
any instrument required to effect any Award granted by the Administrator; and

              (o) to exercise all other powers granted to the Administrator
under the Plan and make all other determinations deemed necessary or advisable
for administering the Plan.

       4.3. Effect of Administrator's Decision. The Administrator's decisions,
determinations and interpretations shall be final and binding on all
Participants and any other holders of Options or Stock awarded under the Plan.

       4.4. Expenses, Etc. All expenses and liabilities incurred by the
Administrator in the administration of the Plan shall be borne by the Company.
The Administrator may employ attorneys, consultants, accountants or other
persons in connection with the administration of the Plan. The Company, and its
officers and directors, shall be entitled to rely upon the advice, opinions or
valuations of any such persons. No member of the Administrator shall be liable
for any action, determination or interpretation taken or made in good faith with
respect to the Plan or any Award granted thereunder.

       Section 5. Eligibility. Awards may be granted to any Employee, Consultant
or Non-Employee Director. The Administrator shall have the sole authority to
select the Employees and Consultants to whom discretionary Awards are to be
granted hereunder, and to determine whether a person is to be granted a
Non-Qualified Stock Option, an Incentive Stock Option, Restricted Stock or
Unrestricted Stock, or any combination thereof. Non-Employee Directors shall
only be eligible to receive grants of Non-Qualified Stock Options pursuant to
Section 6.8 of the Plan. No person other than an Employee, Consultant or
Non-Employee Director shall have any right to participate in the Plan. Any
person selected by the Administrator for participation during any one period
will not by virtue of such participation have the right to be selected as a
Participant for any other period. The maximum number of shares of Common Stock
which may be the subject of Awards granted to any one Employee or Consultant
under the Plan during any calendar year shall be 700,000 shares. For this
purpose, the grant of a new Award in substitution for outstanding Awards shall
be deemed to constitute a new grant, separate from the original grant that is to
be canceled. Incentive Stock Options may be granted only to persons eligible to
receive Incentive Stock Options under the Code.

       Section 6. Options.

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       6.1. Award. Subject to the provisions of the Plan, the Administrator may
award Incentive Stock Options and Non-Qualified Stock Options, and determine the
number of shares to be covered by each Option, the option price therefor and the
conditions and limitations applicable to the exercise of the Option. The terms
and conditions of Incentive Stock Options shall be subject to and comply with
Section 422 of the Code, or any successor provision, and any regulations
thereunder.

       6.2. Exercise Price. The Administrator shall establish the exercise price
of each Option at the time such Option is awarded. Such price shall not be less
than 85% of the Fair Market Value of the Common Stock on the date of grant;
provided, that (i) in the case of an Incentive Stock Option, the exercise price
shall not be less than 100% of the Fair Market Value of the Common Stock at the
time of grant and (ii) in the case of a Non-Qualified Stock Option intended to
qualify as "performance-based compensation" within the meaning of Section 162(m)
of the Code, the exercise price shall not be less than 100% of the Fair Market
Value at the time of grant.

       6.3. Vesting. Each Option shall be exercisable at such times and subject
to such terms and conditions as the Administrator may specify in the applicable
Option agreement or thereafter. The Administrator may impose such conditions
with respect to the exercise of Options, including conditions relating to
applicable federal or state securities laws, as it considers necessary or
advisable.

       6.4. Payment. Options granted under the Plan may provide for the payment
of the exercise price by delivery of cash or check in an amount equal to the
exercise price of such Options or, to the extent permitted by the Administrator
at or after the award of the Option, by (a) delivery of shares of Common Stock
owned by the optionee, valued at their Fair Market Value on the date of such
option exercise, (b) delivery of a promissory note of the optionee to the
Company on terms determined by the Administrator, (c) delivery of an irrevocable
undertaking by a broker to deliver promptly to the Company sufficient funds to
pay the exercise price or delivery of irrevocable instructions to a broker to
deliver promptly to the Company cash or a check sufficient to pay the exercise
price, (d) payment of such other lawful consideration as the Administrator may
determine, or (e) any combination of the foregoing. In the event an optionee
pays some or all of the exercise price of an Option by delivery of shares of
Common Stock pursuant to clause (a) above, the Administrator may provide for the
automatic award of an Option for up to the number of shares so delivered.

       6.5. Transferability. Except as otherwise specifically approved by the
Administrator, each Option granted under the Plan shall provide that neither it
nor any interest therein may be transferred, assigned, pledged or hypothecated,
by the optionee or by operation of law otherwise than by will, the laws of
descent and distribution or a "qualified domestic relations order" (as defined
in the Code), and shall be exercised during the lifetime of the optionee only by
the optionee or a transferee pursuant to such a "qualified domestic relations
order". No Option or interest therein may be or be made subject to execution,
attachment or similar process.

       6.6 Cancellation and New Grant of Options. The Board of Directors shall
have the

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authority to effect, at any time and from time to time, with the consent of the
affected optionees, (i) the cancellation of any or all outstanding options under
the Plan and the grant in substitution therefor of new Options under the Plan
covering the same or different numbers of shares of Common Stock and having an
option exercise price per share which may be lower or higher than the exercise
price per share of the canceled Options, or (ii) the amendment of the terms of
any and all outstanding Options under the Plan to provide an option exercise
price per share which is higher or lower than the then current exercise price
per share of such outstanding Options.

       6.7. Incentive Stock Options. Options granted under the Plan which are
intended to be Incentive Stock Options shall be subject to the following
additional terms and conditions:

            (a)  All Incentive Stock Options granted under the Plan shall, at
the time of grant, be specifically designated as such in the option agreement
covering such Incentive Stock Options. The exercise period shall not exceed ten
years from the date of grant.

            (b)  If any Employee to whom an Incentive Stock Option is to be
granted under the Plan is, at the time of the grant of such option, the owner of
stock possessing more than 10% of the total combined voting power of all classes
of stock of the Company (after taking into account the attribution of stock
ownership rule of Section 424(d) of the Code), then the following special
provisions shall be applicable to the Incentive Stock Option granted to such
individual:

                 (i)  The purchase price per share of the Common Stock
subject to such Incentive Stock Option shall not be less than 110% of the Fair
Market Value of one share of Common Stock at the time of grant; and

                 (ii) The Option exercise period shall not exceed five years
from the date of grant.

            (c)  For so long as the Code shall so provide, options granted to
any Employee under the Plan (and any other incentive stock option plans of the
Company or its Subsidiaries) which are intended to constitute Incentive Stock
Options shall not constitute Incentive Stock Options to the extent that such
Options, in the aggregate, become exercisable for the first time in any one
calendar year for shares of Common Stock with an aggregate Fair Market Value
(determined as of the respective date or dates of grant) of more than $100,000.

            (d)  No Incentive Stock Option may be exercised unless, at the time
of such exercise, the Participant is, and has been continuously since the date
of grant of his or her Option, employed by the Company, except that:

                 (i)  an Incentive Stock Option may be exercised (to the
extent exercisable on the date the Participant ceased to be an Employee of the
Company or a Parent or Subsidiary) within the period of three months after the
date the Participant ceases to be an employee of the Company or such Parent or
Subsidiary (or within such lesser period as may be specified in the applicable
option agreement); provided, that the agreement with respect to such Option may
designate a longer exercise period and that the exercise after such three-month

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period shall be treated as the exercise of a Non-Qualified Stock Option under
the Plan;

                     (ii)  if the Participant dies while in the employ of the
Company, or within three months after the Participant ceases to be an Employee,
the Incentive Stock Option (to the extent otherwise exercisable on the date of
death) may be exercised by the Participant's Designated Beneficiary within the
period of one year after the date of death (or within such lesser period as may
be specified in the applicable Option agreement); and

                     (iii) if the Participant becomes disabled (within the
meaning of Section 22(e)(3) of the Code or any successor provision thereto)
while in the employ of the Company, the Incentive Stock Option may be exercised
(to the extent otherwise exercisable on the date of death) within the period of
one year after the date of such disability (or within such lesser period as may
be specified in the Option agreement). In the event of the Participant's death
during this one-year period, the Incentive Stock Option may be exercised by the
Participant's Designated Beneficiary within the period of one year from the date
the Participant became disabled or within such lesser period as may be specified
in the applicable Option agreement.

For all purposes of the Plan and any Option granted hereunder, (i) "employment"
shall be defined in accordance with the provisions of Section 1.421-7(h) of the
Treasury Regulations under the Code (or any successor regulations) and (ii) any
Option may provide that if such Option shall be assumed or a new Option
substituted therefor in a transaction to which Section 424(a) of the Code
applies, employment by such assuming or substituting corporation shall be
considered for all purposes of such Option to be employment by the Company.
Notwithstanding the foregoing provisions, no Incentive Stock Option may be
exercised after its expiration date.

       6.8. Non-Employee Director Options. Director Options shall be automatic
and subject to the following additional terms and conditions:

            (a) All Director Options shall be Non-Qualified Stock Options.

            (b) Each Non-Employee Director shall be granted an Initial Option
to purchase 1,000 shares of Common Stock on the date of his or her initial
election to the Board of Directors, and an Annual Option to purchase 1,000
shares of Common Stock on the next business day following each annual meeting of
stockholders.

            (c) The exercise price of each Director Option will be 100% of the
Fair Market Value at the time of grant.

            (d) Director Options shall become exercisable six months after the
time of grant. The exercise period shall not exceed ten years from the date of
grant; provided, that, subject to the provisions of Section 6.8(e), no Director
Option may be exercised more than 90 days after the optionee ceases to serve as
a director of the Company.

            (e) if a Non-Employee Director dies or becomes disabled becomes
disabled (within the meaning of Section 22(e)(3) of the Code or any successor
provision thereto) while a

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director of the Company, the Option may be exercised (to the extent otherwise
exercisable on the date of disability or death), by such disabled director or,
in the case of death, by the director's Designated Beneficiary, in each case
within the period of one year after the date of disability or death (or within
such lesser period as may be specified in the applicable Option agreement).

       Section 7. Restricted And Unrestricted Stock.

       7.1. General. The Board of Directors may grant Awards entitling
recipients to acquire shares of Common Stock, subject to the right of the
Company to repurchase all or part of such shares at their purchase price (or to
require forfeiture of such shares if purchased at no cost) from the recipient in
the event that conditions specified by the Administrator in the applicable Award
are not satisfied prior to the end of the applicable Restricted Period or
Restricted Periods established by the Administrator for such Award. Conditions
for repurchase (or forfeiture) may be based on continuing employment or service
and/or achievement of pre-established performance or other goals and objectives.

       7.2. Restricted Stock. Shares of Restricted Stock may not be sold,
assigned, transferred, pledged or otherwise encumbered, except as permitted by
the Administrator, during the applicable Restricted Period. Shares of Restricted
Stock shall be evidenced in such manner as the Board of Directors may determine.
Any certificates issued in respect of shares of Restricted Stock shall be
registered in the name of the Participant and, unless otherwise determined by
the Board of Directors, deposited by the Participant, together with a stock
power endorsed in blank, with the Company (or its designee). At the expiration
of the Restricted Period, the Company (or such designee) shall deliver such
certificates to the Participant or, if the Participant has died, to the
Participant's Designated Beneficiary.

       7.3. Unrestricted Stock. The Administrator may, in its sole discretion,
grant (or sell at a purchase price determined by the Board of Directors, which
shall not be lower than 85% of Fair Market Value on the date of sale)
Unrestricted Stock to Participants.

       7.4. Payment. The purchase price for each share of Restricted Stock and
Unrestricted Stock shall be determined by the Administrator and may not be less
than the par value of the Common Stock. Such purchase price may be paid in the
form of past services or such other lawful consideration as is determined by the
Board of Directors.

       7.5. Certificates. Stock certificates representing Shares of Restricted
Stock or Unrestricted Stock shall bear a legend referring to any restrictions
imposed thereon and such other matters as the Administrator may determine.

       7.6. Acceleration. The Administrator may at any time accelerate the
expiration of the Restricted Period applicable to all, or any particular,
outstanding shares of Restricted Stock.

       Section 8. General Provisions Applicable to Awards.

       8.1. Applicability of Rule 16b-3. Those provisions of the Plan which make
an express

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reference to Rule 16b-3 shall apply to the Company only at such time as the
Company's Common Stock is registered under the Exchange Act, or any successor
provision, and then only with respect to Reporting Persons.

       8.2. Documentation. Each Award under the Plan shall be evidenced by an
instrument delivered to the Participant specifying the terms and conditions
thereof and containing such other terms and conditions not inconsistent with the
provisions of the Plan as the Administrator considers necessary or advisable.
Such instruments may be in the form of agreements to be executed by both the
Company and the Participant, or certificates, letters or similar documents,
acceptance of which will evidence agreement to the terms thereof and of this
Plan.

       8.3. Administrator Discretion. Each type of Award may be made alone, in
addition to or in relation to any other type of Award. The terms of each type of
Award need not be identical, and the Administrator need not treat Participants
uniformly.

       8.4. Termination of Status. Subject to the provisions of Section 6, the
Administrator shall determine the effect on an Award of the disability, death,
retirement, authorized leave of absence or other termination of employment or
other status of a Participant and the extent to which, and the period during
which, the Participant's legal representative, guardian or Designated
Beneficiary may exercise rights under such Award.

       8.5. Mergers, Etc. In the event of a consolidation or merger or sale of
all or substantially all of the assets of the Company in which outstanding
shares of Common Stock are exchanged for securities, cash or other property of
any other corporation or business entity (an "Acquisition"), the Board of
Directors or the board of directors of any corporation assuming the obligations
of the Company, may, in its discretion, take any one or more of the following
actions as to outstanding Awards: (i) provide that such Awards shall be assumed,
or substantially equivalent Awards shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof) on such terms as the Board of
Directors determines to be appropriate; (ii) upon written notice to
Participants, provide that all unexercised Options will terminate immediately
prior to the consummation of such transaction unless exercised by the
Participant within a specified period following the date of such notice; (iii)
in the event of an Acquisition under the terms of which holders of the Common
Stock of the Company will receive upon consummation thereof a cash payment for
each share surrendered in the Acquisition (the "Acquisition Price"), make or
provide for a cash payment to Participants equal to the difference between (A)
the Acquisition Price times the number of shares of Common Stock subject to
outstanding Options (to the extent then exercisable at prices not in excess of
the Acquisition Price) and (B) the aggregate exercise price of all such
outstanding Options in exchange for the termination of such Options; and (iv)
provide that all or any outstanding Awards shall become exercisable or
realizable in full prior to the effective date of such Acquisition.

       8.6. Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, to the extent that an Option has not been
previously exercised, it will terminate immediately prior to the consummation of
such proposed action. The Board of Directors may, in the exercise of its sole
discretion in such instances, declare that any Award shall terminate as of a

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date fixed by the Board of Directors and give each Participant the right to
exercise his or her Option as to all or any of the shares subject thereto,
including shares as to which the Option would not otherwise be exercisable, or
may accelerate the termination of the Restricted Period of any Stock Award.

       8.7.  Withholding. The Participant shall pay to the Company, or make
provision satisfactory to the Administrator for payment of, any taxes required
by law to be withheld in respect of Awards under the Plan no later than the date
of the event creating the tax liability. In the Administrator's discretion, and
subject to such conditions as the Administrator may establish, such tax
obligations may be paid in whole or in part in shares of Common Stock, including
shares retained from the Award creating the tax obligation, valued at their Fair
Market Value. The Company may, to the extent permitted by law, deduct any such
tax obligations from any payment of any kind otherwise due to the Participant.

       8.8.  Foreign Nationals. Awards may be made to Participants who are
foreign nationals or employed outside the United States on such terms and
conditions different from those specified in the Plan as the Administrator
considers necessary or advisable to achieve the purposes of the Plan or comply
with applicable laws.

       8.9.  Amendment of Award. The Administrator may amend, modify or
terminate any outstanding Award, including substituting therefor another Award
of the same or a different type, changing the date of exercise or realization
and converting an Incentive Stock Option to a Non-Qualified Stock Option;
provided, that the Participant's consent to such action shall be required unless
the Administrator determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.

       8.10. Conditions on Delivery of Common Stock. The Company will not be
obligated to deliver any shares of Common Stock pursuant to the Plan or to
remove restrictions from shares previously delivered under the Plan (i) until
all conditions of the Award have been satisfied or removed; (ii) until, in the
opinion of the Company's counsel, all applicable federal and state laws and
regulations have been complied with; (iii) if the outstanding Common Stock is at
the time listed on any stock exchange or admitted for trading on an automatic
quotation system, until the shares to be delivered have been listed or
authorized to be listed or quoted on such exchange or quotation system upon
official notice of notice of issuance; and (iv) until all other legal matters in
connection with the issuance and delivery of such shares have been approved by
the Company's counsel. If the sale of Common Stock has not been registered under
the Securities Act of 1933, as amended, the Company may require, as a condition
to exercise of the Award, such representations or agreements as the Company may
consider appropriate to avoid violation of such act and may require that the
certificates evidencing such Common Stock bear an appropriate legend restricting
transfer.

       Section 9. Miscellaneous

       9.1.  No Right To Employment or Other Status. The grant of an Award shall
not be construed as giving a Participant the right to continued employment or
service for the Company.

                                       12

<PAGE>

The Company expressly reserves the right at any time to dismiss a Participant
free from any liability or claim under the Plan, except as expressly provided in
the applicable Award.

       9.2. No Rights As Stockholder. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any rights
as a stockholder with respect to any shares of Common Stock to be distributed
under the Plan until he or she becomes the record holder thereof.

       9.3. Exclusion from Benefit Computations. No amounts payable upon
exercise of Awards granted under the Plan shall be considered salary, wages or
compensation to Participants for purposes of determining the amount or nature of
benefits that Participants are entitled to under any insurance, retirement or
other benefit plans or programs of the Company.

       9.4. Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such shares as to which such requisite
authority shall not have been obtained.

       9.5. Grants Exceeding Allotted Shares. If the shares of Common Stock
covered by an Award exceeds, as of the date of grant, the number of Shares which
may be issued under the Plan without additional stockholder approval, such Award
shall be void with respect to such excess stock, unless such additional
stockholder approval is obtained in a timely manner.

       9.6. Effective Date and Term.

            (a) Effective Date. The Plan shall become effective on August 17,
1999, the date of its adoption by the Board of Directors, but no Incentive Stock
Option granted under the Plan shall become exercisable unless and until the Plan
shall have been approved by the Company's stockholders. If such stockholder
approval is not obtained within twelve months after the date of the Board of
Director's adoption of the Plan, no Options previously granted under the Plan
shall be deemed to be Incentive Stock Options and no Incentive Stock Options
shall be granted thereafter under the Plan. Amendments to the Plan not requiring
stockholder approval shall become effective when adopted by the Board of
Directors; amendments requiring stockholder approval shall become effective when
adopted by the Board of Directors, but no Incentive Stock Option granted after
the date of such amendment shall become exercisable (to the extent that such
amendment to the Plan was required to enable the Company to grant such Incentive
Stock Option to a particular optionee) unless and until such amendment shall
have been approved by the Company's stockholders. If such stockholder approval
is not obtained within twelve months of the Board of Director's adoption of such
amendment, any Incentive Stock Options granted on or after the date of such
amendment shall terminate to the extent that such amendment to the Plan was
required to enable the Company to grant such Option to a particular optionee.
Subject to the limitations set forth in this Section 9.6(a), Awards may be made
under the Plan at any time after the effective date and before the date fixed
for termination of the Plan.

                                       13

<PAGE>

              (b) Termination. The Plan shall terminate upon the earlier of (i)
the close of business on the day next preceding the tenth anniversary of the
date of its adoption by the Board of Directors, (ii) the date on which all
shares available for issuance under the Plan shall have been issued pursuant to
Awards under the Plan, or (iii) by action of the Board of Directors. No Award
may be granted hereunder after termination of the Plan. The termination or
amendment of the Plan shall not alter or impair any rights or obligations under
theretofore granted under the Plan.

       9.7.   Amendment of Plan. The Board of Directors may amend, suspend or
terminate the Plan or any portion thereof at any time; provided, that no
amendment shall be made without stockholder approval if such approval is
necessary to comply with any applicable tax or regulatory requirement (it being
understood that prior to any such approval, Awards may be made under the Plan
expressly subject to such approval); and provided further, that, in accordance
with Section 8.9, the Participant's consent to any such action with respect to
its effect on any outstanding Award shall be required unless the Administrator
determines that the action, taking into account any related action, would not
materially and adversely affect the Participant.

       9.8.   Governing Law. The provisions of the Plan shall be governed by and
interpreted in accordance with the laws of the State of Delaware.

                    *****************************************

                                       14<PAGE>

                                                                    EXHIBIT 10.4

                              EMPLOYMENT AGREEMENT

         This Employment Agreement (this "Agreement") is made and entered into
as of the 5th day of August, 2002, between Concentra Inc., a Delaware
corporation (the "Company"), and Fred Dunlap ("Executive").

                                   WITNESSETH:

         WHEREAS, Executive desires to be employed as President and Chief
Operating Officer of the Company as an integral part of the Company's management
who participates in the decision-making process relative to short and long-term
planning and policy for the Company; and

         WHEREAS, it is the desire of the Board of Directors of the Company (the
"Board of Directors") to assure itself of the management services of Executive
by engaging Executive as an officer of the Company and its subsidiaries and
affiliates; and

         WHEREAS, Executive is desirous of committing himself to serve the
Company on the terms herein provided.

         NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth below, the parties hereto agree as follows:

         1. Employment and Term. The Company hereby agrees to employ Executive
as its President and Chief Operating Officer, and Executive hereby agrees to
accept such employment, on the terms and conditions set forth herein, for the
period commencing on the date first set forth above (the "Effective Date") and
expiring as of 11:59 p.m. on the second anniversary of the Effective Date
(unless sooner terminated as hereinafter set forth) (the "Term"); provided,
however, that commencing on such second anniversary date, and each anniversary
of the date hereof thereafter, the Term of this Agreement shall automatically be
extended for one additional year unless at least thirty (30) days prior to each
such anniversary date, the Company or Executive shall have given notice that it
or he, as applicable, does not wish to extend this Agreement.

         2. Duties and Restrictions.

            (a) Duties as Employee of the Company. Executive shall,
subject to the supervision of the Company's Chief Executive Officer, serve as
the Company's President and Chief Operating Officer, with all such powers as may
be set forth in the Company's Bylaws with respect to, and/or are reasonably
incident to, such officerships.

            (b) Other Duties. Executive agrees to serve as requested by the
Company as a director of the Company's subsidiaries and affiliates and in one or
more executive offices of any

                                       1

<PAGE>

of the Company's subsidiaries and affiliates; provided, that the Company
indemnifies Executive for serving in any and all such capacities in a manner
acceptable to the Company and Executive. Executive agrees that he shall not be
entitled to receive any compensation for serving in any capacities of the
Company's subsidiaries and affiliates other than the compensation to be paid to
Executive by the Company pursuant to this Agreement.

          (c) Noncompetition. Executive agrees that he will not, for a period of
eighteen (18) months following the termination of his employment with the
Company, (1) solicit the employment of, endeavor to entice away from the Company
or its subsidiaries or affiliates or otherwise interfere with any person who was
an employee of or consultant to the Company or any of its subsidiaries or
affiliates during the one year period preceding such termination, or (2) be
employed by, associated with, or have any interest in, directly or indirectly
(whether as principal, director, officer, employee, consultant, partner,
stockholder, trustee, manager, or otherwise), any occupational healthcare
company or occupational health managed care company (not to include the managed
health care industry in general) which has a principal line of business that is
directly competitive with the Company or its subsidiaries or affiliates in any
geographical area in which the Company or its subsidiaries or affiliates engage
in business at the time of such termination or in which any of them, prior to
termination of Executive's employment and by a writing created in the ordinary
course of business and executed prior to the Notice of Termination with respect
to Executive's termination of employment, evidenced its intention to engage in
business. Notwithstanding the foregoing, Executive shall not be prohibited from
owning five percent or less of the outstanding equity securities of any entity
whose equity securities are listed on a national securities exchange or publicly
traded in any over-the-counter market. The Company acknowledges that Executive
possesses substantial experience and expertise in this industry, and, other than
as expressly set forth in this Section 2(b), the use of that experience and
expertise in the future will not be deemed to be a violation of this Agreement.

          (d) Confidentiality. Executive shall not, directly or indirectly, at
any time during or following the termination of his employment with the Company,
reveal, divulge, or make known to any person or entity, or use for Executive's
personal benefit (including, without limitation, for the purpose of soliciting
business competitive with any business of the Company or any of its subsidiaries
or affiliates), any information acquired during the course of employment
hereunder with regard to the financial, business, or other affairs of the
Company or any of its subsidiaries or affiliates (including, without limitation,
any list or record of persons or entities with which the Company or any of its
subsidiaries or affiliates has any dealings), other than (1) material already in
the public domain, (2) information of a type not considered confidential by
persons engaged in the same business or a similar business to that conducted by
the Company, or (3) material that Executive is required to disclose under the
following circumstances: (A) in the performance by Executive of his duties and
responsibilities hereunder, reasonably necessary or appropriate disclosure to
another employee of the Company or to representatives or agents of the Company
(such as independent public accountants and legal counsel); (B) at the express
direction of any authorized governmental entity; (C) pursuant to a subpoena or
other court process; (D) as otherwise required by law or the rules, regulations,
or orders of any applicable regulatory body; or (E) as otherwise necessary, in
the opinion of counsel for Executive, to be disclosed by Executive in connection
with the prosecution of any legal action or proceeding

                                       2

<PAGE>

initiated by Executive against the Company or any subsidiary or affiliate of the
Company or the defense of any legal action or proceeding initiated against
Executive in his capacity as an employee or director of the Company or any
subsidiary or affiliate of the Company. Executive shall, at any time requested
by the Company (either during or after his employment with the Company),
promptly deliver to the Company all memoranda, notes, reports, lists, and other
documents (and all copies thereof) relating to the business of the Company or
any of its subsidiaries or affiliates that he may then possess or have under his
control.

     3. Compensation and Related Matters.

        (a) Base Salary. Executive shall receive a base salary paid by the
Company ("Base Salary") at the annual rate of Five Hundred Thousand Dollars
($500,000) during each calendar year of the Term, payable in periodic
installments at such times (no less frequently than monthly) as executives of
the Company normally are paid. In addition, the Company's Board of Directors or
the Compensation Committee of the Board of Directors shall, in good faith,
consider granting increases in the Base Salary based on such factors as
Executive's performance and the growth and/or profitability of the Company, but
the Company shall have no obligation to grant such increases in compensation.

        (b) Bonus Payments. Executive shall be entitled to receive, in addition
to the Base Salary, such bonus payments, if any, as the Board of Directors or
the Compensation Committee of the Board of Directors may specify.

        (c) Expenses. During the term of his employment hereunder, Executive
shall be entitled to receive prompt reimbursement for all reasonable expenses
incurred by him (in accordance with the policies and procedures established by
the Board of Directors for its senior executive officers) in performing services
hereunder, provided that Executive properly accounts therefor in accordance with
Company policy.

        (d) Other Benefits. Executive shall be entitled to participate in or
receive benefits under any employee benefit plan or other arrangement made
available by the Company now or in the future to its senior executive officers
and key management employees, subject to and on a basis consistent with the
terms, conditions, and overall administration of such plan or arrangement.
Nothing paid to Executive under any plan or arrangement presently in effect or
made available in the future shall be deemed to be in lieu of the Base Salary
payable to Executive pursuant to paragraph (a) of this Section 3. The Company
shall not make any changes in any employee benefit plans or other arrangements
in which Executive participates (including, without limitation, each pension and
retirement plan, supplemental pension and retirement plan, savings and profit
sharing plan, stock or unit ownership plan, stock or unit purchase plan, stock
or unit option plan, life insurance plan, medical insurance plan, disability
plan, dental plan, health-and-accident plan, or any other similar plan or
arrangement) that would adversely affect Executive's rights or benefits
thereunder, unless such change occurs pursuant to a program applicable to all
executives of the Company and does not result in a proportionately greater
reduction in the rights of or benefits to Executive as compared with any other
executive of the Company.

                                       3

<PAGE>

        (e) Vacations. Executive shall be entitled to ten (10) paid vacation
days for the period from the date of this Agreement through December 31, 2002.
Executive shall be entitled to twenty (20) paid vacation days in each calendar
year commencing on or after January 1, 2003, or such additional number as may be
determined by the Board of Directors from time to time. For purposes of this
Section 3(e), weekends shall not count as vacation days and Executive shall also
be entitled to all paid holidays given by the Company to its senior executive
officers.

        (f) Perquisites. Executive shall be entitled to receive the perquisites
and fringe benefits appertaining generally to senior executive officers of the
Company in accordance with any practice established by the Board of Directors.
In the event Executive's employment hereunder is terminated (whether by
Executive or the Company) for any reason whatsoever (other than Executive's
death), then the Company shall, at Executive's written request and to the extent
permitted by the terms of such policies and applicable law, assign and convey to
Executive any life insurance policies maintained by the Company on the life of
Executive, who shall thereafter be solely responsible, at his election, to pay
all premiums payable after such assignment and conveyance to maintain the
coverage under such policies with respect to Executive. Executive shall not be
required to pay any money or other consideration to the Company upon such
assignment and conveyance, it being acknowledged and agreed by the parties
hereto that Executive's execution and delivery hereof constitute adequate and
satisfactory consideration for such assignment and conveyance.

        (g) Proration. Any payments or benefits payable to Executive hereunder
in respect of any calendar year during which Executive is employed by the
Company for less than the entire year, unless otherwise provided in the
applicable plan or arrangement, shall be prorated in accordance with the number
of days in such calendar year during which he is so employed.

     4. Executive's Office and Relocation.

        (a) Executive shall primarily perform his duties and responsibilities
hereunder at the Company's office located at 5080 Spectrum Drive, Addison, Texas
(or at such other location within the Dallas, Texas, metropolitan area, to which
the Company may in the future relocate such principal executive office), except
for reasonable required travel on the Company's business. If the Company
requests Executive to report for the performance of his services hereunder on a
regular or permanent basis at any location or office more than thirty-five (35)
miles from the office location described in the first sentence of this Section
4, and Executive agrees to such change, the Company shall pay Executive's
reasonable relocation and moving expenses, including, but not limited to, the
cost of moving his immediate family, expenses incurred while seeking new housing
(including travel by Executive's spouse) and temporary living expenses incurred
by Executive or his family for up to one hundred eighty (180) days.

        (b) It is the parties' intention that Executive will relocate his
residence from Florida to the Dallas, Texas, metropolitan area, as soon as
reasonably practicable, at the Company's expense. Following the Effective Date,
the Company will reimburse Executive for relocation and moving expenses
reasonably incurred by Executive in relocating his home from Florida to the
Dallas, Texas, metropolitan area (including, without limitation, house-hunting
trips

                                       4

<PAGE>

for Executive and his spouse, the cost of temporary housing in the Dallas area
as reasonably required, real estate commissions and closing costs on the sale of
Executive's Florida home, the cost of moving Executive's household goods from
Florida to Texas, and a "gross up" for those items that are considered wages for
tax purposes).

     5. Termination. Executive's employment hereunder may be terminated by the
Company or Executive, as applicable, without any breach of this Agreement, only
under the following circumstances.

        (a) Death. Executive's employment hereunder shall terminate upon his
death.

        (b) Disability. If, as a result of Executive's incapacity due to
physical or mental illness, Executive shall have been unable, with reasonable
accommodation, to perform the essential functions of his duties and
responsibilities hereunder on a full time basis for one hundred eighty (180)
consecutive calendar days, and within thirty (30) days after written notice of
termination is given (which may occur before or after the end of such one
hundred eighty (180) day period) Executive shall not have returned to the
performance of his material managerial duties and responsibilities hereunder on
a full time basis, the Company may terminate Executive's employment hereunder.

        (c) Cause. Subject to the provisions of Section 7(d), the Company may
terminate Executive's employment hereunder for Cause. For purposes of this
Agreement, the Company shall have "Cause" to terminate Executive's employment
hereunder upon:

            (1) Executive's willful or intentional failure to perform or gross
negligence in the performance of Executive's material duties and
responsibilities hereunder (other than any such failure resulting from
Executive's incapacity due to physical or mental illness or any such actual or
anticipated failure after the issuance of a Notice of Termination for Good
Reason (as hereinafter defined) by Executive);

            (2) The commission by Executive of dishonesty or fraud of a material
nature in connection with the performance of his duties hereunder, or willful or
intentional misconduct of a material nature in connection with the performance
of his duties hereunder;

            (3) The conviction of Executive, or the entering of a plea of nolo
contendere by Executive, with respect to a felony;

            (4) Unprofessional or unethical conduct of a material nature by
Executive in connection with the performance of his duties hereunder as
determined in a final adjudication of any board, institution, organization or
governmental agency having any privilege or right to pass upon the conduct of
Executive;

            (5) Intentional, willful, or grossly negligent conduct by Executive
which is materially detrimental to the reputation, character, business, or
standing of the Company, including, without limitation, the use by Executive of
a controlled substance; or

                                       5

<PAGE>

              (6) The continued material breach by Executive of any of
Executive's obligations under Section 2(c), 2(d), or 4(b) of this Agreement, or
Executive's failure (other than by reason of a breach of this Agreement by the
Company) to serve the Company on a full-time basis in accordance with Sections
1, 2(a), and 2(b) of this Agreement.

          (d) Termination by Executive. Subject to the provisions of Section
7(c), and at his option, Executive may terminate his employment hereunder (1)
for Good Reason, or (2) upon no less than ninety (90) days prior written notice
to the Company.

          For purposes of this Agreement, the termination of Executive's
employment hereunder by Executive because of the occurrence of any one or more
of the following events shall be deemed to have occurred for "Good Reason":

              (A) a material change in the nature or scope of Executive's
authorities, status, powers, functions, duties, responsibilities, or reporting
relationships that is determined by Executive in good faith to be adverse to
those existing before such change;

              (B) any removal by the Company of Executive from, or any failure
to reelect Executive to, the positions indicated in Section 1 hereof except in
connection with termination of Executive's employment for Cause or disability;

              (C) a reduction in Executive's Base Salary, a reduction in any
bonus potential or other material adverse change in any bonus plan or program
applicable to Executive after any such bonus potential or bonus plan or program
has been communicated to Executive, or any other failure by the Company to
comply with Section 3 hereof that is not consented to or approved by Executive;

              (D) the relocation of Executive's office at which he is to perform
his duties and responsibilities hereunder to a location outside of the Dallas,
Texas, metropolitan area, or a materially adverse alteration in the office space
within which Executive is to perform his duties and responsibilities hereunder
or in the secretarial and administrative support provided to Executive;

              (E) a failure by the Company or any subsidiary or affiliate of the
Company to comply with any other material term or provision hereof or of any
other written agreement between Executive and the Company or any such subsidiary
or affiliate; or

              (F) the occurrence of a Change in Control (as defined in Exhibit A
attached hereto), other than a Change in Control occurring by reason of an
initial public offering of the Company's equity securities and/or by reason of a
sale of the Company's equity securities pursuant to a public registration of
such securities by the Company within twelve (12) months following an initial
public offering of the Company's equity securities.

     6. Compensation Upon Termination or Failure to Renew. Executive shall be
entitled to the following compensation from the Company upon the termination of
his employment or

                                       6

<PAGE>

upon the Company's delivery of notice pursuant to Section 1 that the Term of
this Agreement shall not following any anniversary of the date hereof be
automatically extended for an additional year.

          (a) Death. If Executive's employment shall be terminated by reason of
his death, the Company shall pay to such person as shall have been designated in
a notice filed with the Company prior to Executive's death, or, if no such
person shall be designated, to his estate as a death benefit, his Base Salary to
the date of his death in addition to any payments Executive's spouse,
beneficiaries, or estate may be entitled to receive pursuant to any pension or
employee benefit plan or other arrangement or life insurance policy maintained
by the Company. In addition, (x) the Company shall make payments of premiums to
continue the medical and dental insurance coverage of Executive's spouse and
children under age twenty-five (25) as in effect at and as of the date of
Executive's death (or to provide as similar coverage as possible for the same
premiums if the continuation of existing coverage is not permitted) for one (1)
year after the date of Executive's death, and (y) the Company shall make a lump
sum cash payment to the appropriate insurance company(ies) in an amount
sufficient to fully fund future premium payments pursuant to any then existing
second-to-die, split-dollar insurance policy(ies) obtained by Executive through
the Company.

          (b) Disability. During any period that Executive fails to perform his
material managerial duties and responsibilities hereunder as a result of
incapacity due to physical or mental illness, Executive shall continue to
receive his Base Salary and any bonus payments until Executive's employment is
terminated pursuant to Section 5(b) hereof or until Executive terminates his
employment pursuant to Section 5(d)(2) hereof, whichever first occurs. After
such termination, the Company shall pay to Executive, on or before the fifth day
following the Date of Termination (as hereinafter defined) his Base Salary to
the Date of Termination. In addition, (x) the Company shall make payments of
premiums as necessary to cause Executive and Executive's spouse and children
under age twenty-five (25) to continue to be covered by the medical and dental
insurance as in effect at and as of the Date of Termination (or to provide as
similar coverage as possible for the same premiums if the continuation of
existing coverage is not permitted) for one (1) year after the Date of
Termination, and (y) the Company shall make a lump sum cash payment to the
appropriate insurance company(ies) in an amount sufficient to fully fund future
premium payments pursuant to any then existing second-to-die, split-dollar
insurance policy(ies) obtained by Executive through the Company.

          (c) Termination by the Company for Cause or by Executive Other Than
Because of Death, Disability or Good Reason. If Executive's employment shall be
terminated by the Company for Cause or if Executive shall terminate his
employment other than for Good Reason and other than by reason of his death or
disability, the Company shall pay Executive his Base Salary through the Date of
Termination at the rate in effect at the time Notice of Termination is given.
Such payments shall fully discharge the Company's obligations hereunder.

          (d) Breach by the Company, for Good Reason, or Upon Failure to Renew.
If (1) in breach of this Agreement, the Company shall terminate Executive's
employment (it being understood that a purported termination of Executive's
employment by the Company pursuant to

                                       7

<PAGE>

any provision of this Agreement that is disputed and finally determined not to
have been proper shall be a termination by the Company in breach of this
Agreement), or (2) Executive shall terminate his employment for Good Reason, or
(3) the Company shall give Executive notice pursuant to Section 1 prior to any
anniversary of the date hereof that the Term of this Agreement shall not be
automatically extended for an additional year on any such anniversary date, then
the Company shall pay Executive:

               (A) his Base Salary through the Date of Termination at the rate
in effect at the time Notice of Termination is given;

               (B) in lieu of any further salary payments to Executive for
periods subsequent to the Date of Termination, the Company shall pay as
severance pay to Executive on or before the fifth day following the Date of
Termination and on the fifth day of each of the seventeen (17) months thereafter
(amounting to a total of eighteen (18) months), an amount in cash equal to
one-twelfth (1/12) of Executive's annual Base Salary at the rate in effect at
the time the Notice of Termination is given (for a total of one and one-half (1
1/2) years' Base Salary);

               (C) in lieu of any further bonus or incentive compensation
payments to Executive for periods subsequent to the Date of Termination, the
Company shall pay to Executive on or before the fifth day following the Date of
Termination and on the fifth day of each of the seventeen (17) months thereafter
(amounting to a total of eighteen (18) months), an amount in cash equal to
one-twelfth (1/12) of Executive's average annual bonus compensation actually
received from the Company with respect to the two (2) year period immediately
preceding the date the Notice of Termination is given (or such lesser period as
Executive shall have been employed by the Company at such time); and

               (D) all benefits payable under the terms of any employee benefit
plan or other arrangement as of the Date of Termination.

         In addition, (x) the Company shall make payments of premiums as
necessary to cause Executive and Executive's spouse and children under age
twenty-five (25) to continue to be covered by the medical and dental insurance
as in effect at and as of the Date of Termination (or to provide as similar
coverage as possible for the same premiums if the continuation of existing
coverage is not permitted) for one (1) year after the Date of Termination, in
each case to the extent such coverage is available, and (y) the Company shall
make a lump sum cash payment to the appropriate insurance company(ies) in an
amount sufficient to fully fund future premium payments pursuant to any then
existing second-to-die, split-dollar insurance policy(ies) obtained by Executive
through the Company

         (e) Mitigation. Executive shall not be required to mitigate the amount
of any payment provided for in this Section 6 by seeking other employment or
otherwise.

     7.  Other Provisions Relating to Termination.

                                       8

<PAGE>

                  (a) Notice of Termination. Any termination of Executive's
employment by the Company or by Executive (other than termination because of the
death of Executive) shall be communicated by written Notice of Termination to
the other party hereto. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of
Executive's employment under the provision so indicated.

                  (b) Date of Termination. For purposes of this Agreement, "Date
of Termination" shall mean: (1) if Executive's employment is terminated by his
death, the date of his death; (2) if Executive's employment is terminated
because of a disability pursuant to Section 5(b), then thirty (30) days after
Notice of Termination is given (provided that Executive shall not have returned
to the performance of his duties on a full-time basis during such thirty (30)
day period); (3) if Executive's employment is terminated by the Company for
Cause or by Executive for Good Reason, then, subject to Sections 7(c) and 7(d),
the date specified in the Notice of Termination; (4) if the Company gives
Executive notice pursuant to Section 1 prior to any anniversary of the date
hereof that the Term of this Agreement shall not be automatically extended for
an additional year on any such anniversary date, the date upon which the Term
expires; (5) if Executive terminates his employment pursuant to Section 5(d),
ninety (90) days after Notice of Termination is given by Executive (or such
shorter period as the Company in its sole discretion shall determine after
receipt of such a Notice of Termination; provided, that, in such event, the
Company will pay Executive his Base Salary with respect to the full ninety (90)
days of the notice period, without regard to the number of days actually
worked); and (6) if Executive's employment is terminated for any other reason,
the date on which a Notice of Termination is given.

                  (c) Good Reason. Upon the occurrence of an event described in
clauses (A) through (E) of the definition of "Good Reason" in Section 5(d),
Executive may terminate his employment hereunder for Good Reason within one
hundred eighty (180) days thereafter by giving a Notice of Termination to the
Company to that effect. If the effect of the occurrence of the event giving rise
to Good Reason under Section 5(d) may be cured, the Company shall have the
opportunity to cure any such effect for a period of thirty (30) days following
receipt of Executive's Notice of Termination. If the Company fails to cure any
such effect, the termination for Good Reason shall become effective on the date
specified in Executive's Notice of Termination. If Executive does not give such
Notice of Termination to the Company with respect to an event constituting Good
Reason, then this Agreement will remain in effect, and Executive shall be deemed
for all purposes to have waived his right to terminate his employment for Good
Reason with respect to such event; provided, however, that the failure of
Executive to terminate this Agreement for Good Reason shall not be deemed a
waiver of Executive's right to terminate his employment for Good Reason upon the
occurrence of a subsequent event described in Section 5(d) in accordance with
the terms of this Agreement.

                  (d) Cause. In the case of any termination of Executive for
Cause, the Company will give Executive a Notice of Termination describing in
reasonable detail, the facts or circumstances giving rise to Executive's
termination (and, if applicable, the action required to

                                       9

<PAGE>

cure same) and will permit Executive thirty (30) business days to cure such
failure to comply or perform. Cause for Executive's termination will not be
deemed to exist until the expiration of the foregoing cure period, so long as
Executive continues to use his best efforts during the cure period to cure such
failure. If after thirty (30) business days following Executive's receipt of a
Notice of Termination for Cause, Executive has not cured the facts or
circumstances giving rise to Executive's termination for Cause, then Executive's
termination for Cause shall be effective as of the date specified in the Notice
of Termination.

               (e) Interest. Until paid, all past due amounts required to be
paid by the Company under any provision of this Agreement shall bear interest at
the highest non-usurious rate permitted by applicable federal, state, or local
law.

         8.    Successors; Binding Agreement.
               -----------------------------

               (a) Successors. This Agreement shall be binding upon, and inure
to the benefit of, the Company, Executive, and their respective successors,
assigns, personal and legal representatives, executors, administrators, heirs,
distributees, devisees, and legatees, as applicable.

               (b) Assumption. Upon the written request of Executive, the
Company will require any successor (whether direct or indirect, by purchase of
securities, merger, consolidation, sale of assets, or otherwise) to all or
substantially all of the business or assets of the Company, by an agreement in
form and substance satisfactory to Executive, to expressly assume this Agreement
and to agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such succession had taken
place. Failure of the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement and
shall entitle Executive to compensation from the Company in the same amount and
on the same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be
deemed the Date of Termination.

               (c) Certain Payments. If Executive should die while any amounts
would still be payable to him hereunder if he had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to Executive's devisee, legatee, or other designee
or, if there be no such designee, to Executive's estate.

         9.    Notice. For purposes of this Agreement, all notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when (a) delivered personally, (b) sent by
facsimile or similar electronic device and confirmed, (c) delivered by overnight
express, or (d) if sent by any other means, upon receipt. Notices and all other
communications provided for in this Agreement shall be addressed as follows:

               If to Executive:      To Executive's home address as reflected
                                     from time to time in the Company's records;
                                     and

                                       10

<PAGE>

              If to the Company:     Concentra Inc.
                                     5080 Spectrum Drive, Suite 400 - West Tower
                                     Addison, Texas  75001
                                     Attention: General Counsel
                                     Fax No.: (972) 387-1938

or to such other address as either party may have furnished to the other in
writing in accordance herewith.

         10.  Miscellaneous. No provision of this Agreement may be modified,
waived, or discharged unless such waiver, modification, or discharge is agreed
to in a written instrument signed by Executive and the Company. No waiver by
either party hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. The validity,
interpretation, construction, and performance of this Agreement shall be
governed by the laws of the State of Delaware, excluding any choice-of-law
provisions thereof.

         11.  Attorney Fees. All legal fees and costs incurred by Executive in
connection with the resolution of any dispute or controversy under or in
connection with this Agreement (including, without limitation, the termination
or purported termination of this Agreement) shall be reimbursed by the Company
to Executive as bills for such services are presented by Executive to the
Company, unless such dispute or controversy is found to have been brought not in
good faith or without merit by a court of competent jurisdiction.

         12.  Validity.  The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this  Agreement, which shall remain infull force and
effect.

         13.  Counterparts.  This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same agreement.

         14.  Entire Agreement. Excepting only (a) that certain Option Award
Agreement, dated August 5, 2002, between the Company and Executive, (b) that
certain Restricted Stock Award Agreement, dated August 5, 2002, between the
Company and Executive, and (c) that certain Memorandum regarding 2002 and 2003
Incentive Bonus Program from the Company's Chief Executive Officer to Executive
(each of which continues in effect in accordance with its respective terms),
this Agreement constitutes the entire agreement between the parties with respect
to the subject matter hereof and supersedes in all respects any and all prior
employment agreements and/or severance protection letters, agreements, or
arrangements between Executive, on the one hand, and the Company or any other
predecessor in interest thereto or any of their

                                       11

<PAGE>

respective subsidiaries, on the other hand, which prior employment agreements
and/or severance protection letters, agreements, and arrangements, if any, are
hereby cancelled and of no further force or effect.

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

                                     COMPANY:

                                     CONCENTRA  INC.

                                     By:   /s/  Daniel J. Thomas
                                        -------------------------------
                                           Daniel J. Thomas
                                           President and Chief Executive Officer

                                     EXECUTIVE:

                                           /s/ Fred Dunlap
                                     ------------------------------------
                                           Fred Dunlap

                                       12

<PAGE>

                                    EXHIBIT A

                        DEFINITION OF "CHANGE IN CONTROL"

         As used in this Agreement, "Change in Control" shall mean the
occurrence of any of the following events:

                  (A) The acquisition by any individual, entity, or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended) of beneficial ownership of either (x) the then
outstanding shares of Common Stock of the Company (the "Outstanding Company
Common Stock") or (y) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"), such that WCAS ceases
to own, in the aggregate, more than 50% of the Outstanding Company Common Stock
or of the Outstanding Company Voting Securities; provided, however, that for
purposes of this Subparagraph (A), the following acquisitions shall not
constitute a Change of Control: (1) any acquisition of Company Common Stock or
other Company voting securities directly from the Company, (2) any acquisition
by the Company, (3) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation controlled by
the Company or (4) any acquisition by any corporation pursuant to a transaction
which complies with clauses (1), (2), and (3) of Subparagraph (C) below; or

                  (B) Individuals who, as of the date of the Plan, constitute
the Board of Directors cease for any reason to constitute at least a majority of
the Incumbent Board (as hereinafter defined); or

                  (C) Consummation of a reorganization, merger or consolidation
or sale or other disposition of all or substantially all of the assets of the
Company or an acquisition of assets of another corporation (a "Business
Combination"), in each case, unless, following such Business Combination, (1)
all or substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of, respectively, the
then outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which as a result of
such transaction owns the Company or all or substantially all of the Company's
assets either directly or through one or more subsidiaries) in substantially the
same proportions as their ownership, immediately prior to such Business
Combination of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be, (2) no individual, entity, or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended) (excluding any employee benefit plan (or related trust)
of the Company or the corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more of, respectively, the
then outstanding shares of common stock of the corporation resulting from such
Business Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership results
solely from ownership of the Company that existed prior to the Business
Combination, and (3) at least a majority of the members of the board of
directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or

                                       13

<PAGE>

                  (D) Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

         As used in this Agreement, "Incumbent Board" means the individuals who
constitute the Board of Directors on the date hereof and any other individual
who becomes a director of the Company after that date and whose election or
appointment by the Board of Directors or nomination for election by the
Company's stockholders was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board, but excluding, for this purpose,
any such individual whose initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a person other than the Incumbent Board.

                                       14

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