Document:

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                                                                   Exhibit 10.58

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

         THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") is
made and entered into as of January 1, 2001, by and between AMERICAN
HOMEPATIENT, INC., a Delaware corporation (the "Employer"), and MARILYN O'HARA,
a resident of the State of Tennessee (the "Employee").

                              W I T N E S S E T H:

         WHEREAS, Employee and Employer entered into that certain Employment
Agreement effective as of January 1, 1999; and

         WHEREAS, Employee and Employer subsequently amended the Employment
Agreement by the First Amendment to Employment Agreement effective as of January
1, 2000 (the "First Amendment); and

         WHEREAS, Employee and Employer subsequently amended the Employment
Agreement by the Second Amendment to Employment Agreement effective as of
December 1, 2000 (the "Second Amendment); and

         WHEREAS, Employer and Employee have agreed to enter into this Agreement
which sets forth the terms and conditions of Employee's employment by Employer.

         NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements made herein, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows:

1.                EMPLOYMENT. Employer hereby employs Employee and Employee
         hereby accepts employment with Employer on the terms and conditions
         specified herein.

2.                TERM. The term of this Agreement shall be for a period
         commencing on the date hereof and ending December 31, 2001; provided,
         however, that this Agreement will thereafter automatically renew for
         consecutive one-year terms unless either party notifies the other party
         in writing at least thirty (30) days prior to the end of the then
         current term that this Agreement will not renew but instead will
         terminate at the expiration of the then current term. Such notice of
         non-renewal by Employer under this Section 2 will be treated as a
         termination without "cause" and will be subject to Section 5(b) herein.
         Notwithstanding anything to the contrary contained in this Agreement,
         except the provisions of Section 8 which supercede this provision, the
         provisions of Section 6 and 7 will survive the expiration or
         termination of this Agreement.

3.                DUTIES OF EMPLOYEE. Employee shall be responsible for certain
         assigned aspects of Employer's operations and shall initially have the
         title Executive Vice President, Chief

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         Financial Officer, and Corporate Secretary. Employee shall perform the
         duties and responsibilities assigned to Employee from time to time in
         accordance with the policies and objectives established by the Board of
         Directors and Chief Executive Officer of Employer. Employee agrees to
         devote her full time, attention and skill to her duties hereunder and
         to use her best efforts to attain or exceed Employer's objective goals
         for profit, quality, stability and growth. Employee will at all times
         while employed by Employer comply fully with Employer's "Guidelines of
         Company Policies and Conduct" and any other compliance programs of
         Employer, as such programs may be amended from time to time, and
         acknowledges that her obligations under such programs as an employee
         are contractual in nature.

4.                COMPENSATION.

         a.                Employee will be paid a base salary of Two Hundred
                  Ten Thousand Dollars and No/100 Dollars ($210,000) per year
                  during the term of this Agreement, payable in accordance with
                  Employer's standard payroll practices. Employee will be
                  entitled to receive incentive compensation of up to fifty
                  percent (50%) of her annual base salary under such incentive
                  programs as may from time to time be provided to employees of
                  Employer of similar rank, which programs may be created,
                  changed or terminated at any time at Employer's sole
                  discretion. Employer will periodically conduct a merit review
                  regarding Employee's performance to consider increasing, but
                  not decreasing, Employee's base salary.

         b.                Employer recognizes that Employee will be relocating
                  from her former primary residence in Warwick, Rhode Island to
                  Brentwood, Tennessee. As an inducement for such relocation,
                  Employer will reimburse Employee for all reasonable and actual
                  travel and other expenses incurred by Employee in traveling to
                  and from Warwick, Rhode Island and Brentwood, Tennessee during
                  the term of this Agreement. Reimbursement hereunder will be
                  subject to compliance with Employer's reimbursement policies
                  as established from time to time.

         c.                Employee will be entitled to such medical, dental,
                  disability and life insurance benefits, participation in any
                  profit-sharing plan or similar plans of Employer, and such
                  other employee benefits as are provided to employees of
                  Employer of similar rank from time to time. Promptly following
                  execution and delivery of this Agreement, either the Board of
                  Directors of Employer or such Board's Independent Stock Option
                  Committee will consider and act upon a grant of stock options
                  under Employer's 1991 Non-Qualified Stock Option Plan in favor
                  of Employee.

5.                TERMINATION.

         a.                Employee's employment will be terminable by Employer
                  at any time for cause, which will include but not be limited
                  to (i) insubordination, malfeasance, misconduct, (ii) charge
                  or conviction of a felony or of a misdemeanor involving

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                  moral turpitude, (iii) the inability of Employee to perform
                  her duties hereunder for a period of thirty (30) consecutive
                  days (or sixty (60) total days in any ninety (90) consecutive
                  day period) by reason of illness or mental or physical
                  disability, (iv) death, and (v) other circumstances deemed by
                  the Employer to be materially detrimental to the Employer.
                  Notwithstanding the above, it is the intent of the Employer at
                  all times to comply with the Americans With Disabilities Act,
                  the Family and Medical Leave Act and any other applicable
                  federal and state employment laws. This Agreement will be
                  terminable by Employee upon thirty (30) days written notice to
                  Employer if without cause. In the case of termination under
                  this Section 5(a), all obligations of the parties under this
                  Agreement and relating to Employee's employment will cease
                  except for Employee's obligations under Sections 6 and 7
                  hereof.

         b.                Employee's employment will be terminable by Employee
                  upon written notice to Employer if Employer willfully breaches
                  any material terms of this Agreement, after fifteen (15) day's
                  written notice and right to cure. Employee's employment will
                  also be terminable by Employer at any time without "cause", as
                  such term is defined above in clause (a). A notice of
                  non-renewal by Employer pursuant to Section 2 of this
                  Agreement will be treated as a termination without "cause" and
                  shall be subject to the provisions of this Section 5(b). In
                  the case of termination under this Section 5(b), all
                  obligations of the parties in this Agreement will cease except
                  for Employee's obligations under Sections 6 and 7 (the
                  continuation of such obligations being subject to Section 8).
                  If Employer terminates Employee's employment without "cause",
                  Employee will be entitled to receive as a severance payment in
                  a lump sum at termination an amount equal to (i) her annual
                  base salary (not including incentive compensation or
                  benefits), as in effect at the time of termination, plus (ii)
                  the annual incentive compensation Employee received for
                  performance during Employer's immediately preceding fiscal
                  year, multiplied by a fraction, the numerator of which is the
                  total number of full calendar months during which Employee was
                  employed by Employer during Employer's current fiscal year
                  prior to termination and the denominator of which is twelve
                  (12). Employer will pay Employee such severance in a lump sum
                  promptly following termination. In addition, Employer will (i)
                  pay Employee promptly following termination any earned but
                  unpaid base salary through the date of termination, and (ii)
                  pay the COBRA administrative services company the standard
                  employer portion of the COBRA premium attributable to
                  Employee's medical and dental insurance benefits as such
                  benefits were in effect immediately prior to termination with
                  payments beginning on the first day of the calendar month
                  immediately following the date of termination and continuing
                  until the earlier of (y) twelve (12) months after the date of
                  termination, or (z) the date on which Employee is eligible to
                  receive, as an employee, independent contractor or agent,
                  medical and/or dental insurance benefits from a third party.
                  Employer will deduct from the lump severance payment due to
                  Employee the standard employee portion of such COBRA premium
                  as in effect on the date of termination for a twelve (12)
                  month period. If Employee elects to discontinue COBRA for any

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                  reason before expiration of the applicable period and notifies
                  Employer of the same in writing, Employer will thereafter
                  refund to Employee that portion of the deduction, if any, not
                  attributable to the COBRA premium actually paid. Employer
                  acknowledges that in the event Employer terminates Employee's
                  employment under this Section 5(b) without "cause", Employee
                  will be entitled to her individual vested account balance with
                  respect to Employer's Stock Purchase Plan as such balance, if
                  any, exists as of the date of termination of employment.
                  Employee acknowledges that in the event Employer terminates
                  her employment without "cause", she will be entitled to no
                  payments other than as expressly set forth in this Section
                  5(b).

         c.                (1)      In the event there is a "Change in Control"
                  of the ownership of Employer, and Employer terminates
                  Employee's employment within twelve (12) months following such
                  Change in Control, or Employee terminates her employment
                  pursuant to Section 5(d) below, Employee will be entitled to
                  receive as a severance payment in a lump sum upon such
                  termination an amount equal to the sum of (i) her monthly base
                  salary (not including incentive compensation or benefits) as
                  in effect at the time of such termination multiplied by
                  twenty-four (24), plus (ii) an amount equal to two (2) times
                  the greater of (x) the incentive compensation Employee
                  received for performance during Employer's immediately
                  preceding fiscal year and (y) the current incentive
                  compensation target in effect for Employee at the time of such
                  termination or resignation. In addition, any earned but unpaid
                  base salary and incentive compensation will be paid, and
                  Employer will subsidize COBRA premiums for Employee's medical
                  and dental insurance benefits as such benefits were in effect
                  immediately prior to termination by paying to Employee upon
                  termination an amount equal to the standard employer portion
                  of the COBRA premium for a twenty-four (24) month period.
                  Employer acknowledges that, in the event of such termination
                  following a Change in Control, Employee will be entitled to
                  her individual vested account balances with respect to
                  Employer's Supplemental Executive Retirement and Stock
                  Purchase Plans, as the balances, if any, exist as of the date
                  of termination of employment. Further, any stock options
                  granted to Employee will be fully vested upon a Change of
                  Control, whether or not Employee's employment is terminated,
                  notwithstanding any previously stated vesting restrictions but
                  subject to expiration or termination pursuant to the governing
                  stock option plan.

                           (2)      A "Change in Control" will be deemed to have
                  occurred if (i) a tender offer will be made and consummated
                  for the ownership of more than fifty percent (50%) of the
                  outstanding voting securities of Employer, (ii) Employer will
                  be merged or consolidated with another corporation and as a
                  result of such merger or consolidation less than fifty percent
                  (50%) of the outstanding voting securities of the surviving or
                  resulting corporation will be owned in the aggregate by the
                  former shareholders of Employer, as the same will have existed
                  immediately prior to such merger or consolidation, (iii)
                  Employer will sell all or substantially all of its assets to
                  another corporation that is not a wholly-owned subsidiary, or
                  (iv) a

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                  person, within the meaning of Section 3(a)(9) or of Section 13
                  (d)(3) (as in effect on the date hereof) of the Securities and
                  Exchange Act of 1934 ("Exchange Act"), will acquire more than
                  fifty percent (50%) of the outstanding voting securities of
                  Employer (whether directly, indirectly, beneficially or of
                  record). For purposes hereof, ownership of voting securities
                  shall take into account and shall include ownership as
                  determined by applying the provisions of Rule 13d-3(d)(1)(i)
                  (as in effect on the date hereof) pursuant to the Exchange
                  Act.

         d.                In the event there is a Change in Control of the
                  ownership of Employer, and within twelve (12) months following
                  such Change in Control Employer (i) materially changes
                  Employee's job title or function, or (ii) requires Employee to
                  relocate from the greater Nashville, Tennessee area, Employee
                  may immediately terminate this Agreement, subject to the
                  continuing obligations found in Sections 6 and 7 hereof. Upon
                  a termination by Employee pursuant to this Section 5(d),
                  Employee will be entitled to the severance payment and other
                  benefits as provided in Section 5(c)(1) above.

6.                CONFIDENTIAL INFORMATION. In consideration of the covenants of
         Employer contained herein, Employee agrees as follows:

         a.       Employee hereby agrees and acknowledges that she has had
                  access to or is aware of certain confidential, restricted
                  and/or proprietary information concerning operation by the
                  Employer and its affiliates of their home health care
                  businesses (collectively the "Business"). Employee hereby
                  undertakes and agrees that she will have a duty to Employer
                  and its affiliates to protect such information from use or
                  disclosure.

         b.       For the purposes of this Section 6, the following definitions
                  will apply:

                  i.       "Trade Secret" as related to the Business, will mean
                           any specialized technical information or data
                           relating to (w) procurement of medical equipment and
                           other inventory for resale; (x) marketing strategy or
                           plans of Employer or its affiliates; (y) proprietary
                           computer software; and (z) terms of contracts with
                           suppliers, employees and principal customers of
                           Employer or its affiliates which are not generally
                           known to the competitors of Employer.

                  ii.               "Confidential Information," as related to
                           the Business, will mean any data or information,
                           other than Trade Secrets, which is material to
                           Employer or its affiliates and not generally known by
                           the public. Confidential Information will include,
                           without limitation, any information pertaining to the
                           Business Opportunities (as hereinafter defined) of
                           Employer or its affiliates, the details of this
                           Agreement, and the business plans, financial
                           statements and projections of Employer or its
                           affiliates.

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                  iii.              "Business Opportunity" will mean any
                           information or plans of Employer or its affiliates
                           concerning the purchase of or investment in any
                           retail outlets, stores, distribution centers or
                           similar retail facilities in the field of home health
                           care, or the availability of any such outlets for
                           purchase or investment by Employer or its affiliates,
                           together with all related information, concerning the
                           specifics of any contemplated purchase or investment
                           (including price, terms and the identity of such
                           outlet), regardless of whether Employer or its
                           affiliates have entered any agreement, made any
                           commitment, or issued any bid or offer to such outlet
                           or other facility.

         c.                Employee will not, without the prior written consent
                  of Employer, use or disclose, or negligently permit any
                  unauthorized person who is not an employee of Employer to use,
                  disclose, or gain access to, any Trade Secrets or Confidential
                  Information.

         d.                Employee hereby agrees to maintain on behalf of
                  Employer, or, upon request or termination of this Agreement,
                  deliver to Employer, all memoranda, notes, records, drawings,
                  manuals, documents, disks, computer software and other
                  materials, including all copies and derivations of such
                  materials, containing Trade Secrets or Confidential
                  Information, whether made or compiled by Employee or furnished
                  to her from any source by virtue of her relationship with
                  Employer or its affiliates.

         e.                Employee will, with reasonable notice during and
                  after her employment by Employer, furnish information as may
                  be in her possession and cooperate with Employer or its
                  affiliates as may reasonably be requested in connection with
                  any claims or legal actions in which Employer is or may become
                  a party. Employer will reimburse Employee for any reasonable
                  out-of-pocket expenses she incurs in order to satisfy her
                  obligations under this clause (e).

7.                NONCOMPETE, ETC. In consideration of the covenants of the
         Employer contained herein, the Employee agrees as follows:

         a.                During and after her employment by Employer, Employee
                  will not use her status with Employer to obtain loans, goods
                  or services from another organization on terms that would not
                  be available to her in the absence of her relationship to
                  Employer. During the period of employment and for a twelve
                  (12) month period following termination of such employment for
                  any reason, (i) Employee will not make any statements or
                  perform any acts intended to advance the interest of any
                  existing or prospective competitor of Employer in any way that
                  will injure the interests of Employer or an affiliate; and
                  (ii) Employee will not directly or indirectly own or hold any
                  "Proprietary Interest" in or be employed by or receive
                  compensation from any party engaged in the same or any similar
                  business within fifty (50) miles of any location of Employer
                  upon the date of termination of

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                  employment. The states in which Employer and its affiliates
                  currently conduct business are Alabama, Arizona, Arkansas,
                  Colorado, Connecticut, Delaware, Florida, Georgia, Illinois,
                  Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland,
                  Massachusetts, Michigan, Minnesota, Mississippi, Missouri,
                  Nebraska, Nevada, New Jersey, New Mexico, New York, North
                  Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island,
                  South Carolina, Tennessee, Texas, Virginia, Washington, West
                  Virginia and Wisconsin. During her employment by Employer and
                  for a twelve (12) month period following termination of such
                  employment for any or no reason, (i) Employee will not solicit
                  any client of Employer or an affiliate or discuss with any
                  client or employee of Employer or an affiliate any information
                  or the operation of any business intended to compete with
                  Employer or an affiliate; and (ii) Employee will not, directly
                  or indirectly, hire any current or future employee of Employer
                  or an affiliate, or solicit or encourage any such employee to
                  leave the employ of Employer or an affiliate. For the purposes
                  of this Agreement, "Proprietary Interest" means legal or
                  equitable ownership, whether through stock holdings or
                  otherwise, of a debt or equity interest (including options,
                  warrants, rights and convertible interests) in a business firm
                  or entity, or ownership of more than 5% of any class of equity
                  interest in a publicly-held company. Employee acknowledges
                  that the covenants contained herein are reasonable as to
                  geographic and temporal scope.

         b.                Employee acknowledges that her breach or threatened
                  or attempted breach of any provision of Section 6 or 7 would
                  cause irreparable harm to Employer not compensable in monetary
                  damages and that Employer will be entitled, in addition to all
                  other applicable remedies, to a temporary and permanent
                  injunction and a decree for specific performance of the terms
                  of Section 6 or 7 without being required to prove damages or
                  furnish any bond or other security. Nothing herein contained
                  will be construed as prohibiting Employer from pursuing any
                  other remedy available to it for such breach or threatened or
                  attempted breach.

         c.                All parties hereto acknowledge the necessity of
                  protection against the competition of the Employee and that
                  the nature and scope of such protection has been carefully
                  considered by the parties. The period and area covered are
                  expressly acknowledged and agreed to be fair, reasonable and
                  necessary. If any covenant contained in Section 6 or 7 is held
                  to be invalid, illegal or unenforceable because of the
                  duration of such covenant, the geographic area covered thereby
                  or otherwise, the parties agree that the court making such
                  determination will have the power to reduce the duration, the
                  area and/or other provision(s) of any such covenant to the
                  maximum permissible and to include as much of its nature and
                  scope as will render it enforceable, and, in its reduced form
                  said covenant will be valid, legal and enforceable.

8.                PAYMENT BREACH BY EMPLOYER. Notwithstanding anything to the
         contrary in this Agreement, Employee's obligations under Sections 6 and
         7 will automatically cease in

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         the event Employer fails to make a severance or other payment to which
         Employee is entitled pursuant to Section 5(b) or 5(c).

9.                COVENANT REGARDING CERTAIN PROCEEDINGS. Employee covenants
         that she will not, without Employer's prior written consent unless
         required to do so by means of a valid court order or subpoena,
         cooperate with any person in the institution or prosecution of any
         proceeding, suit, claim, investigation or administrative proceeding
         brought, initiated or conducted by any person against Employer, its
         affiliates, agents, employees, officers and representatives. Employee
         further covenants that she will notify Employer immediately if she is
         contacted by any person regarding any pending or contemplated
         proceeding, suit, claim or investigation involving Employer, its
         affiliates, agents, employees, officers or representatives. The parties
         understand that the covenants stipulated in this paragraph 8 do not
         limit Employee's ability to initiate or bring any proceeding, suit,
         claim or action against Employer regarding her employment hereunder.

10.               ASSIGNMENTS; SUCCESSORS AND ASSIGNS. The rights and
         obligations of Employee hereunder are not assignable or delegable and
         any prohibited assignment or delegation will be null and void. Employer
         may assign and delegate this Agreement. The provisions hereof shall
         inure to the benefit of and be binding upon the permitted successors
         and assigns of the parties hereto.

11.               GOVERNING LAW.  This Agreement will be interpreted under,
         subject to and governed by the substantive laws of the State of
         Tennessee, without giving effect to provisions thereof regarding
         conflict of laws, and all questions concerning its validity,
         construction, and administration will be determined in accordance
         thereby.

12.               COUNTERPARTS. This Agreement may be executed simultaneously in
         any number of counterparts, each of which will be deemed an original
         but all of which will together constitute one and same instrument.

13.               INVALIDITY. The invalidity or unenforceability of any
         provision of this Agreement will not affect any other provision hereof,
         and this Agreement will be construed in all respects as if such invalid
         or unenforceable provision was omitted. Furthermore, in lieu of such
         illegal, invalid, or unenforceable provision there will be added
         automatically as a part of this Agreement a provision as similar in
         terms to such illegal, invalid, or unenforceable provision as may be
         possible and be legal, valid and enforceable.

14.               EXCLUSIVENESS. This Agreement, the Guidelines of Company
         Policies and Conduct and other policies of Employer constitute the
         entire understanding and agreement between the parties with respect to
         the employment by Employer of Employee and supersedes any and all other
         agreements, oral or written, between the parties.

15.               MODIFICATION. This Agreement may not be modified or amended
         except in writing signed by the parties. No term or condition of this
         Agreement will be deemed to have been waived except in writing by the
         party charged with waiver. A waiver will

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         operate only as to the specific term or condition waived and will not
         constitute a waiver for the future or act on anything other than that
         which is specifically waived.

16.               NOTICES. All notices, requests, consents and other
         communications hereunder will be in writing and will be deemed to have
         been made when delivered or mailed first-class postage prepaid by
         registered mail, return receipt requested, or when delivered if by
         hand, overnight delivery service or confirmed facsimile transmission,
         to the following:

         a.                If to the Employer, at 5200 Maryland Way, Suite 400,
                  Brentwood, Tennessee 37027 Attention: President and Chief
                  Executive Officer, or at such other address as may have been
                  furnished to the Employee by the Employer in writing; or

         b.                If to the Employee, at 444 Elmington Ave. Apt. 603,
                  Nashville, TN 37205 or such other address as may have been
                  furnished to Employer by Employee in writing.

17.               CONSOLIDATION, MERGER OR SALE OF ASSETS. Nothing in this
         Agreement will preclude Employer from consolidating or merging in to or
         with, or transferring all or substantially all of its assets to,
         another corporation which assumes this Agreement and all obligations
         and undertaking of Employer hereunder.

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

                                   "EMPLOYER"

                                    AMERICAN HOMEPATIENT, INC.,
                                    a Delaware corporation

                                    By:    /s/ Joseph F. Furlong III
                                          --------------------------------------
                                    Title: Chairman, President and CEO
                                          --------------------------------------

                                    "EMPLOYEE"

                                    /s/ Marilyn O'Hara
                                    --------------------------------------------
                                    MARILYN O'HARA

                                       9<PAGE>   1
                                                                   Exhibit 10.59

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of January 1, 2001, by and between AMERICAN HOMEPATIENT, INC., a Tennessee
corporation (collectively, with its parent, American HomePatient, Inc., a
Delaware corporation, the "Employer"), and THOMAS E. MILLS, a resident of the
State of Tennessee (the "Employee").

                              W I T N E S S E T H:

         WHEREAS, Employer and Employee have agreed to enter into this Agreement
which sets forth the terms and conditions of Employee's employment by Employer;
and

         WHEREAS, Employer employed Employee beginning on November 26, 1998 to
serve as Executive Vice President, Chief Operating Officer of American
HomePatient, Inc., a Delaware corporation.

         NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements made herein, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows:

1.                EMPLOYMENT. Employer hereby employs Employee and Employee
         hereby accepts employment with Employer on the terms and conditions
         specified herein.

2.                TERM. The term of this Agreement shall be for a period
         commencing on the date hereof and ending December 31, 2001; provided,
         however, that this Agreement will thereafter automatically renew for
         consecutive one-year terms unless either party notifies the other party
         in writing at least thirty (30) days prior to the end of the then
         current term that this Agreement will not renew but instead will
         terminate at the expiration of the then current term. Such notice of
         non-renewal by Employer under this Section 2 will be treated as a
         termination without "cause" and will be subject to Section 5(b) herein.
         Notwithstanding anything to the contrary contained in this Agreement,
         except the provisions of Section 8 which supercede this provision, the
         provisions of Section 6 and 7 will survive the expiration or
         termination of this Agreement.

3.                DUTIES OF EMPLOYEE. Employee shall be responsible for certain
         assigned aspects of Employer's operations and shall initially have the
         title Executive Vice President, Chief Operating Officer of American
         HomePatient, Inc., a Delaware corporation. Employee shall perform the
         duties and responsibilities assigned to Employee from time to time in
         accordance with the policies and objectives established by the Board of
         Directors and Chief Executive Officer of Employer. Employee agrees to
         devote his full time, attention and skill to his duties hereunder and
         to use his best efforts to attain or exceed Employer's objective goals
         for profit, quality, stability and growth. Employee will at all times
         while

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         employed by Employer comply fully with Employer's Code of Ethics Policy
         ("Guidelines of Company Policies and Conduct"), Corporate Compliance
         Plan and any other compliance programs of Employer, as such programs
         may be amended from time to time, and acknowledges that his obligations
         under such programs as an employee are contractual in nature.

4.                COMPENSATION.

         a.                Beginning January 1, 2001, Employee will be paid a
                  base salary of Two Hundred Forty Thousand and No/100 Dollars
                  ($240,000.00) per year for the remainder of the term of this
                  Agreement, payable in accordance with Employer's standard
                  payroll practices. Employee will be entitled to receive
                  incentive compensation of up to fifty percent (50%) of his
                  annual base salary under such incentive programs as may from
                  time to time be provided to employees of Employer of similar
                  rank, which programs may be created, changed or terminated at
                  any time at Employer's sole discretion. Employer will
                  periodically conduct a merit review regarding Employee's
                  performance to consider increasing, but not decreasing,
                  Employee's base salary.

         b.                Employee will receive a monthly automobile allowance
                  of Seven Hundred and No/100 Dollars ($700.00), and Employer
                  will reimburse Employee for all gasoline and oil expenses
                  incurred in the operation of his personal automobile.

         c.                Employee will be entitled to such medical, dental,
                  disability and life insurance benefits, participation in any
                  profit-sharing plan or similar plans of Employer, and such
                  other employee benefits as are provided to employees of
                  Employer of similar rank from time to time. In addition,
                  during the term of this Agreement Employer will reimburse
                  Employee the cost of his individual disability insurance
                  policy premium paid to Paul Revere Insurance Group.

5.                         TERMINATION.

         a.                Employee's employment will be terminable by Employer
                  at any time for "cause", which will be defined as: (i) gross
                  insubordination, gross malfeasance, gross misconduct, (ii)
                  charge or conviction of a felony or of a misdemeanor involving
                  moral turpitude, (iii) the inability of Employee to perform
                  his duties hereunder for a period of sixty (60) consecutive
                  days (or ninety (90) total days in any 120 consecutive day
                  period) by reason of illness or mental or physical disability,
                  and (iv) death. Notwithstanding the above, it is the intent of
                  the Employer at all times to comply with the Americans With
                  Disabilities Act, the Family and Medical Leave Act and any
                  other applicable federal and state employment laws. This
                  Agreement will be terminable by Employee upon thirty (30) days
                  written notice to Employer if without cause. In the case of
                  termination under this Section 5(a), all obligations of the
                  parties under this Agreement and

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                  relating to Employee's employment will cease except for
                  Employee's obligations under Sections 6 and 7 hereof.

         b.                Employee's employment will be terminable by Employee
                  upon written notice to Employer if Employer willfully breaches
                  any material terms of this Agreement, after fifteen (15) day's
                  written notice and right to cure. Employee's employment will
                  also be terminable by Employer at any time without "cause", as
                  such term is defined above in clause (a). A notice of
                  non-renewal by Employer pursuant to Section 2 of this
                  Agreement will be treated as a termination without "cause" and
                  shall be subject to the provisions of this Section 5(b). In
                  the case of termination under this Section 5(b), all
                  obligations of the parties in this Agreement will cease except
                  for Employee's obligations under Sections 6 and 7 (the
                  continuation of such obligations being subject to Section 8).
                  If Employer terminates Employee's employment without "cause",
                  Employee will be entitled to receive as a severance payment in
                  a lump sum at termination an amount equal to the sum of (i)
                  his annual base salary (not including incentive compensation
                  or benefits) plus his annual automobile allowance, each as in
                  effect at the time of termination, plus (ii) the annual
                  incentive compensation Employee received for performance
                  during Employer's immediately preceding fiscal year,
                  multiplied by a fraction, the numerator of which is the total
                  number of full calendar months during which Employee was
                  employed by Employer during Employer's current fiscal year
                  prior to termination and the denominator of which is twelve
                  (12). Employer will pay Employee such severance in a lump sum
                  promptly following termination. In addition, Employer will (i)
                  pay Employee promptly following termination any earned but
                  unpaid base salary through the date of termination, and (ii)
                  pay the COBRA administrative services company the standard
                  employer portion of the COBRA premium attributable to
                  Employee's medical and dental insurance benefits as such
                  benefits were in effect immediately prior to termination with
                  payments beginning on the first day of the calendar month
                  immediately following the date of termination and continuing
                  until the earlier of (y) twelve (12) months after the date of
                  termination, or (z) the date on which Employee is eligible to
                  receive, as an employee, independent contractor or agent,
                  medical and/or dental insurance benefits from a third party.
                  Employer will deduct from the lump severance payment due to
                  Employee the standard employee portion of such COBRA premium
                  as in effect on the date of termination for a twelve (12)
                  month period. If Employee elects to discontinue COBRA for any
                  reason before expiration of the applicable period and notifies
                  Employer of the same in writing, Employer will thereafter
                  refund to Employee that portion of the deduction, if any, not
                  attributable to the COBRA premium actually paid. Employer
                  acknowledges that in the event Employer terminates Employee's
                  employment under this Section 5(b) without "cause", Employee
                  will be entitled to his individual vested account balance with
                  respect to Employer's Stock Purchase Plan as such balance, if
                  any, exists as of the date of termination of employment.
                  Employee acknowledges that in the event Employer terminates
                  his employment without "cause", he will be entitled to no
                  payments other than as expressly set forth in this Section
                  5(b).

                                       3
<PAGE>   4

         c.                (1)      In the event there is a "Change in Control"
                  of the ownership of Employer, and Employer terminates
                  Employee's employment within twelve (12) months following such
                  Change in Control, or Employee terminates his employment
                  pursuant to Section 5(d) below, Employee will be entitled to
                  receive as a severance payment in a lump sum upon such
                  termination an amount equal to the sum of (i) his monthly base
                  salary (not including incentive compensation or benefits) plus
                  his monthly automobile allowance, each as in effect at the
                  time of termination multiplied by twenty-four (24), plus (ii)
                  an amount equal to two (2) times the greater of (x) the
                  incentive compensation Employee received for performance
                  during Employer's immediately preceding fiscal year and (y)
                  the current incentive compensation target in effect for
                  Employee at the time of such termination or resignation. In
                  addition, any earned but unpaid base salary and incentive
                  compensation will be paid, and Employer will subsidize COBRA
                  premiums for Employee's medical and dental insurance benefits
                  as such benefits were in effect immediately prior to
                  termination by paying to Employee upon termination an amount
                  equal to the standard employer portion of the COBRA premium
                  for a twenty-four (24) month period. Employer acknowledges
                  that, in the event of such termination following a Change in
                  Control, Employee will be entitled to his individual vested
                  account balances with respect to Employer's Supplemental
                  Executive Retirement and Stock Purchase Plans, as the
                  balances, if any, exist as of the date of termination of
                  employment. Further, any stock options granted to Employee
                  will be fully vested upon a Change of Control, whether or not
                  Employee's employment is terminated, notwithstanding any
                  previously stated vesting restrictions but subject to
                  expiration or termination pursuant to the governing stock
                  option plan.

                           (2)      A "Change in Control" will be deemed to have
                  occurred if (i) a tender offer will be made and consummated
                  for the ownership of more than fifty percent (50%) of the
                  outstanding voting securities of Employer, (ii) Employer will
                  be merged or consolidated with another corporation and as a
                  result of such merger or consolidation less than fifty percent
                  (50%) of the outstanding voting securities of the surviving or
                  resulting corporation will be owned in the aggregate by the
                  former shareholders of Employer, as the same will have existed
                  immediately prior to such merger or consolidation, (iii)
                  Employer will sell all or substantially all of its assets to
                  another corporation that is not a wholly-owned subsidiary, or
                  (iv) a person, within the meaning of Section 3(a)(9) or of
                  Section 13 (d)(3) (as in effect on the date hereof) of the
                  Securities and Exchange Act of 1934 ("Exchange Act"), will
                  acquire more than fifty percent (50%) of the outstanding
                  voting securities of Employer (whether directly, indirectly,
                  beneficially or of record). For purposes hereof, ownership of
                  voting securities shall take into account and shall include
                  ownership as determined by applying the provisions of Rule
                  13d-3(d)(1)(i) (as in effect on the date hereof) pursuant to
                  the Exchange Act.

                                       4
<PAGE>   5

         d.                In the event there is a Change in Control of the
                  ownership of Employer, and within twelve (12) months following
                  such Change in Control Employer (i) materially changes
                  Employee's job title or function, or (ii) requires Employee to
                  relocate from the greater Nashville, Tennessee area, Employee
                  may immediately terminate this Agreement, subject to the
                  continuing obligations found in Sections 6 and 7 hereof. Upon
                  a termination by Employee pursuant to this Section 5(d),
                  Employee will be entitled to the severance payment and other
                  benefits as provided in Section 5(c)(1) above.

6.                CONFIDENTIAL INFORMATION. In consideration of the covenants of
         Employer contained herein, Employee agrees as follows:

         a.                Employee hereby agrees and acknowledges that he has
                  had access to, will have access to, and is and will become
                  aware of certain confidential, restricted and/or proprietary
                  information concerning operation by the Employer and its
                  affiliates of their home health care businesses (collectively
                  the "Business"). Employee hereby undertakes and agrees that he
                  will have a duty to Employer and its affiliates to protect
                  such information from use or disclosure.

         b.                For the purposes of this Section 6, the following
                  definitions will apply:

                  i.                "Trade Secret" as related to the Business,
                           will mean any specialized technical information or
                           data relating to (w) procurement of medical equipment
                           and other inventory for resale; (x) marketing
                           strategy or plans of Employer or its affiliates; (y)
                           proprietary computer software; and (z) terms of
                           contracts with suppliers, employees and principal
                           customers of Employer or its affiliates which are not
                           generally known to the competitors of Employer.

                  ii.               "Confidential Information," as related to
                           the Business, will mean any data or information,
                           other than Trade Secrets, which is material to
                           Employer or its affiliates and not generally known by
                           the public. Confidential Information will include,
                           without limitation, any information pertaining to the
                           Business Opportunities (as hereinafter defined) of
                           Employer or its affiliates, the details of this
                           Agreement, and the business plans, financial
                           statements and projections of Employer or its
                           affiliates.

                  iii.              "Business Opportunity" will mean any
                           information or plans of Employer or its affiliates
                           concerning the purchase of or investment in any
                           retail outlets, stores, distribution centers or
                           similar retail facilities in the field of home health
                           care, or the availability of any such outlets for
                           purchase or investment by Employer or its affiliates,
                           together with all related information, concerning the
                           specifics of any contemplated purchase or investment
                           (including price, terms and the identity of such
                           outlet), regardless of whether Employer or its
                           affiliates have entered any

                                       5
<PAGE>   6

                           agreement, made any commitment, or issued any bid or
                           offer to such outlet or other facility.

         c.                Employee will not, without the prior written consent
                  of Employer, use or disclose, or negligently permit any
                  unauthorized person who is not an employee of Employer to use,
                  disclose, or gain access to, any Trade Secrets or Confidential
                  Information.

         d.                Employee hereby agrees to maintain on behalf of
                  Employer, or, upon request or termination of this Agreement,
                  deliver to Employer, all memoranda, notes, records, drawings,
                  manuals, documents, disks, computer software and other
                  materials, including all copies and derivations of such
                  materials, containing Trade Secrets or Confidential
                  Information, whether made or compiled by Employee or furnished
                  to him from any source by virtue of his relationship with
                  Employer or its affiliates.

         e.                Employee will, with reasonable notice during and
                  after his employment by Employer, furnish information as may
                  be in his possession and cooperate with Employer or its
                  affiliates as may reasonably be requested in connection with
                  any claims or legal actions in which Employer is or may become
                  a party. Employer will reimburse Employee for any reasonable
                  out-of-pocket expenses he incurs in order to satisfy his
                  obligations under this clause (e).

7.                NONCOMPETE, ETC. In consideration of the covenants of the
         Employer contained herein, the Employee agrees as follows:

         a.                During and after his employment by Employer, Employee
                  will not use his status with Employer to obtain loans, goods
                  or services from another organization on terms that would not
                  be available to him in the absence of his relationship to
                  Employer. During the period of employment and for a twelve
                  (12) month period following termination of such employment for
                  any reason, (i) Employee will not make any statements or
                  perform any acts intended to advance the interest of any
                  existing or prospective competitor of Employer in any way that
                  will injure the interests of Employer or an affiliate; and
                  (ii) Employee will not directly or indirectly own or hold any
                  "Proprietary Interest" in or be employed by or receive
                  compensation from any party engaged in the same or any similar
                  business within fifty (50) miles of any location of Employer
                  upon the date of termination of employment. The states in
                  which Employer and its affiliates currently conduct business
                  are Alabama, Arizona, Arkansas, Colorado, Connecticut,
                  Delaware, Florida, Georgia, Illinois, Iowa, Kansas, Kentucky,
                  Louisiana, Maine, Maryland, Massachusetts, Michigan,
                  Minnesota, Mississippi, Missouri, Nebraska, Nevada, New
                  Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma,
                  Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee,
                  Texas, Virginia, Washington, West Virginia and Wisconsin.
                  During his employment by Employer and for a twelve (12) month
                  period following termination of such employment for

                                       6
<PAGE>   7

                  any or no reason, (i) Employee will not solicit any client of
                  Employer or an affiliate or discuss with any client or
                  employee of Employer or an affiliate any information or the
                  operation of any business intended to compete with Employer or
                  an affiliate; and (ii) Employee will not, directly or
                  indirectly, hire any current or future employee of Employer or
                  an affiliate, or solicit or encourage any such employee to
                  leave the employ of Employer or an affiliate. For the purposes
                  of this Agreement, "Proprietary Interest" means legal or
                  equitable ownership, whether through stock holdings or
                  otherwise, of a debt or equity interest (including options,
                  warrants, rights and convertible interests) in a business firm
                  or entity, or ownership of more than 5% of any class of equity
                  interest in a publicly-held company. Employee acknowledges
                  that the covenants contained herein are reasonable as to
                  geographic and temporal scope.

         b.                Employee acknowledges that his breach or threatened
                  or attempted breach of any provision of Section 6 or 7 would
                  cause irreparable harm to Employer not compensable in monetary
                  damages and that Employer will be entitled, in addition to all
                  other applicable remedies, to a temporary and permanent
                  injunction and a decree for specific performance of the terms
                  of Section 6 or 7 without being required to prove damages or
                  furnish any bond or other security. Nothing herein contained
                  will be construed as prohibiting Employer from pursuing any
                  other remedy available to it for such breach or threatened or
                  attempted breach.

         c.                All parties hereto acknowledge the necessity of
                  protection against the competition of the Employee and that
                  the nature and scope of such protection has been carefully
                  considered by the parties. The period and area covered are
                  expressly acknowledged and agreed to be fair, reasonable and
                  necessary. If any covenant contained in Section 6 or 7 is held
                  to be invalid, illegal or unenforceable because of the
                  duration of such covenant, the geographic area covered thereby
                  or otherwise, the parties agree that the court making such
                  determination will have the power to reduce the duration, the
                  area and/or other provision(s) of any such covenant to the
                  maximum permissible and to include as much of its nature and
                  scope as will render it enforceable, and, in its reduced form
                  said covenant will be valid, legal and enforceable.

8.                PAYMENT BREACH BY EMPLOYER. Notwithstanding anything to the
         contrary in this Agreement, Employee's obligations under Sections 6 and
         7 will automatically cease in the event Employer fails to make a
         severance or other payment to which Employee is entitled pursuant to
         Section 5(b) or 5(c).

9.                COVENANT REGARDING CERTAIN PROCEEDINGS. Employee covenants
         that he will not, without Employer's prior written consent unless
         required to do so by means of a valid court order or subpoena,
         cooperate with any person in the institution or prosecution of any
         proceeding, suit, claim, investigation or administrative proceeding
         brought, initiated or conducted by any person against Employer, its
         affiliates, agents, employees, officers and representatives. Employee
         further covenants that he will notify Employer

                                       7
<PAGE>   8

         immediately if he is contacted by any person regarding any pending or
         contemplated proceeding, suit, claim or investigation involving
         Employer, its affiliates, agents, employees, officers or
         representatives. The parties understand that the covenants stipulated
         in this paragraph 8 do not limit Employee's ability to initiate or
         bring any proceeding, suit, claim or action against Employer regarding
         his employment hereunder.

10.               ASSIGNMENTS; SUCCESSORS AND ASSIGNS. The rights and
         obligations of Employee hereunder are not assignable or delegable and
         any prohibited assignment or delegation will be null and void. Employer
         may assign and delegate this Agreement. The provisions hereof shall
         inure to the benefit of and be binding upon the permitted successors
         and assigns of the parties hereto.

11.               GOVERNING LAW. This Agreement will be interpreted under,
         subject to and governed by the substantive laws of the State of
         Tennessee, without giving effect to provisions thereof regarding
         conflict of laws, and all questions concerning its validity,
         construction, and administration will be determined in accordance
         thereby.

12.               COUNTERPARTS. This Agreement may be executed simultaneously in
         any number of counterparts, each of which will be deemed an original
         but all of which will together constitute one and same instrument.

13.               INVALIDITY. The invalidity or unenforceability of any
         provision of this Agreement will not affect any other provision hereof,
         and this Agreement will be construed in all respects as if such invalid
         or unenforceable provision was omitted. Furthermore, in lieu of such
         illegal, invalid, or unenforceable provision there will be added
         automatically as a part of this Agreement a provision as similar in
         terms to such illegal, invalid, or unenforceable provision as may be
         possible and be legal, valid and enforceable.

14.               EXCLUSIVENESS. This Agreement, the Guidelines of Company
         Policies and Conduct and other policies of Employer constitute the
         entire understanding and agreement between the parties with respect to
         the employment by Employer of Employee and supersedes any and all other
         agreements, oral or written, between the parties.

15.               MODIFICATION. This Agreement may not be modified or amended
         except in writing signed by the parties. No term or condition of this
         Agreement will be deemed to have been waived except in writing by the
         party charged with waiver. A waiver will operate only as to the
         specific term or condition waived and will not constitute a waiver for
         the future or act on anything other than that which is specifically
         waived.

16.               NOTICES. All notices, requests, consents and other
         communications hereunder will be in writing and will be deemed to have
         been made when delivered or mailed first-class postage prepaid by
         registered mail, return receipt requested, or when delivered if by
         hand, overnight delivery service or confirmed facsimile transmission,
         to the following:

                                       8
<PAGE>   9

         a.                If to the Employer, at 5200 Maryland Way, Suite 400,
                  Brentwood, Tennessee 37027 Attention: President and Chief
                  Executive Officer, or at such other address as may have been
                  furnished to the Employee by the Employer in writing; or

         a.                If to the Employee, at 915 Ashford Court, Brentwood,
                  Tennessee 37027 or such other address as may have been
                  furnished to Employer by Employee in writing.

17.               CONSOLIDATION, MERGER OR SALE OF ASSETS. Nothing in this
         Agreement will preclude Employer from consolidating or merging in to or
         with, or transferring all or substantially all of its assets to,
         another corporation which assumes this Agreement and all obligations
         and undertaking of Employer hereunder.

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

                                    "EMPLOYER"

                                    AMERICAN HOMEPATIENT, INC.,
                                    a Tennessee corporation

                                    By:       /s/ Joseph F. Furlong III
                                             -----------------------------------
                                    Title:   Chairman, President and CEO
                                             -----------------------------------

                                    "EMPLOYEE"

                                    /s/ Thomas E. Mills
                                    --------------------------------------------
                                    THOMAS E. MILLS

                                       9

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