Employment Agreement - HealthSouth Corp. and Richard M. Scrushy


                              EMPLOYMENT AGREEMENT

      EMPLOYMENT  AGREEMENT,  dated as of July  23,  1986,  between  HEALTHSOUTH
Rehabilitation Corporation, a Delaware corporation ('HEALTHSOUTH'),  and RICHARD
M. SCRUSHY, a resident of Birmingham, Alabama ('Scrushy').

                              W I T N E S S E T H:

      WHEREAS,   HEALTHSOUTH  is  a  healthcare  concern  engaged  in  providing
comprehensive  rehabilitation  care  services  to the public  through a national
organization;

      WHEREAS,  HEALTHSOUTH  desires to avail  itself of  Scrushy's  talents and
expertise in the management of the rehabilitation  business of HEALTHSOUTH,  and
to employ  him as the  Chairman  of the  Board,  President  and Chief  Executive
Officer of HEALTHSOUTH and certain of its subsidiaries and Scrushy is willing to
accept such employment.

      NOW,  THEREFORE,  in  consideration  of the  premises,  and  other  mutual
promises and covenants hereinafter contained,  HEALTHSOUTH and Scrushy do hereby
agree, for their mutual benefit, as follows:

Section 1.  Employment.

      Scrushy shall be employed by HEALTHSOUTH  under this Agreement,  effective
August  1,  1986,  and  Scrushy  accepts  such  employment  upon the  terms  and
conditions hereinafter set forth.

Section 2.  Term.

      The term of employment  provided for in this  Agreement  shall commence on
August 1, 1986,  and shall  remain in full force and effect for a period of five
years thereafter.

Section 3.  Powers and Duties.

      Scrushy  shall be employed by  HEALTHSOUTH  during the term of  employment
under this Agreement as the Chairman of the Board, President and Chief Executive
Officer of HEALTHSOUTH,  and shall also hold similar offices with  HEALTHSOUTH's
subsidiaries  and/or their  successors.  In addition,  HEALTHSOUTH shall use its
best  efforts to cause  Scrushy to be  nominated  and  elected as a Director  of
HEALTHSOUTH  and its  subsidiaries or their  successors  during the term of this
Agreement. In addition,  Scrushy shall perform such duties as may be assigned to
him from time to time by the Board of Directors of HEALTHSOUTH.  In the event of
a reorganization  of HEALTHSOUTH and its  subsidiaries  which results in Scrushy
not being elected Chairman of the Board,  President and Chief Executive  Officer
of the  successor  company,  such event shall be deemed to be a  termination  of
Scrushy's  employment  pursuant to Section 8(f) of this Agreement.  In the event
that  Scrushy  shall  not be  elected  a  Director  of  HEALTHSOUTH  or any such
successor  company,  Scrushy  may,  at his sole  option,  treat  such event as a
termination of Scrushy's employment pursuant to Section 8(c) of this Agreement.

      In carrying out his duties under this  Agreement,  Scrushy shall have such
powers and duties  usually  incident  to the  office of  Chairman  of the Board,
President and Chief Executive Officer and shall have general  responsibility for
the  overall  development,  expansion  and  operations  of  HEALTHSOUTH  and its
subsidiaries.

      The  performance by Scrushy of any duties assigned to him which are not of
the type  provided  for  herein  shall not  constitute  a waiver  of his  rights
hereunder or an abrogation, abandonment or termination of this Agreement.

      Scrushy  shall devote all of his working time and best efforts in the best
interest and behalf of HEALTHSOUTH  throughout the term of this Agreement,  such
working time and best efforts to be of the type and extent  usually  expended by
executives  of  similar  caliber  in similar  situations.  Scrushy  shall not be
restricted from engaging in a business which is non-competitive with HEALTHSOUTH
and its subsidiaries after normal working hours or on weekends or from investing
his assets in such form or manner as will not require  any  services on his part
in the operation of the affairs of the companies in which such  investments  are
made.

Section 4.  Place of Performance.

      The  headquarters for the performance of Scrushy's duties shall be located
in  Birmingham,  Alabama,  but from time to time  Scrushy  shall be  required to
travel  to   HEALTHSOUTH's   other  locations  in  the  proper  conduct  of  his
responsibilities  under this  Agreement.  As it is  HEALTHSOUTH's  intention  to
expand the business of HEALTHSOUTH on a national scale,  HEALTHSOUTH may require
Scrushy to spend a reasonable  amount of time  traveling,  as his duties and the
business of HEALTHSOUTH and its subsidiaries may require.

Section 5.  Compensation.

      For  all  services   rendered  by  Scrushy  pursuant  to  this  Agreement,
HEALTHSOUTH shall pay Scrushy the following compensation:

            (a) A base  salary at the  annual  rate of  $160,000  for the period
      August 1, 1986 through  December  31,  1986,  and an annual base salary of
      $180,000  thereafter,  such  salary to be paid  semi-monthly.  Such salary
      shall be reviewed annually by the Board of Directors.

            (b)  Scrushy  shall be  entitled  to  participate  in any bonus plan
      approved by the Board of Directors for HEALTHSOUTH's management.

Compensation pursuant to this Section 5 or any other provision of this Agreement
shall be subject to reduction by all applicable withholding, social security and
other state, Federal and local taxes and deductions.

Section 6.  Employee Benefits.

      (a) Scrushy  will be  entitled to  participate  in any  employee  benefits
provided  by  HEALTHSOUTH  and  its   subsidiaries,   such  as  life  insurance,
hospitalization  and major  medical  insurance  plans which  HEALTHSOUTH  has in
effect or may adopt from time to time.  Without  limiting the  generality of the
foregoing, the benefits provided Scrushy during the term of this Agreement shall
also include the following elements:

            (i)   a four-week vacation during each year of this
      Agreement;

            (ii) a car allowance  for an automobile  owned by Scrushy for use by
      Scrushy  in  connection  with  the  execution  of his  duties  under  this
      Agreement in the amount of $500 per month; and

            (iii) HEALTHSOUTH shall provide Scrushy,  either through a corporate
      group disability  insurance plan or otherwise,  with disability  insurance
      coverage equal to at least 60% of his base salary.

      (b) In addition,  the Board of Directors  shall  consider  Scrushy for the
grant  of  options  to  purchase  Common  Stock  of  HEALTHSOUTH,  as  Scrushy's
performance  shall  dictate,  no less frequent than annually  during the term of
this Agreement.

Section 7.  Expenses.

      Scrushy is  authorized  to incur  reasonable  expenses  in  promoting  the
business of HEALTHSOUTH and its subsidiaries,  including expenses, to the extent
used for  business  purposes,  for  entertainment,  travel  and  similar  items.
HEALTHSOUTH will reimburse Scrushy for all such expenses,  upon the presentation
by  him  of  an  itemized  account  of  such  expenditures  in  accordance  with
HEALTHSOUTH procedures.

Section 8.  Termination.

      (a)  HEALTHSOUTH  may terminate the  employment of Scrushy (i) at any time
for just cause by written notice to Scrushy  effective upon receipt,  or (ii) if
Scrushy is unable to perform the services  required of him under this  Agreement
by reason of disability  as defined in the  disability  insurance  plan or plans
referred to in Section  5(a)(iii)  of this  Agreement.  For  purposes of Section
8(a)(i)  above,  the term 'just  cause'  shall have the  meaning  prescribed  in
HEALTHSOUTH's  policy  manual  as  approved  from  time to time by the  Board of
Directors.

      (b) In the  event  that  Scrushy's  employment  by  HEALTHSOUTH  should be
terminated pursuant to Section 8(a)(i) of this Agreement prior to the conclusion
of the term of this  Agreement,  HEALTHSOUTH  shall have no  further  obligation
hereunder,  except for the payment of the  compensation  provided for in Section
5(a) of this  Agreement  for a period of one year  following  such  termination,
which  compensation  shall be considered a debt of HEALTHSOUTH  and shall not be
discharged by reason of termination of Scrushy's employment.

      (c) In the  event  that  Scrushy's  employment  by  HEALTHSOUTH  shall  be
terminated for any reason other than as set forth in Section 8(a)(i), 8(d), 8(e)
or  8(f)  of this  Agreement,  HEALTHSOUTH  shall  have  no  further  obligation
hereunder,  except for the payment of compensation  provided for in Section 5(a)
of this Agreement for the remaining term of this Agreement,  but in no event for
a period of less than two years,  which  compensation shall be considered a debt
of HEALTHSOUTH and shall not be discharged by reason of termination of Scrushy's
employment.

      (d) In the  event  of the  death  of  Scrushy  during  the  term  of  this
Agreement,  the Agreement shall terminate  immediately and HEALTHSOUTH shall pay
to the widow or estate of  Scrushy,  or such  other  person or persons as may be
designated  by Scrushy in  writing,  an amount  equal to one year's  annual base
salary payable in one lump sum.

      (e) Scrushy may terminate his employment  under this Agreement  before the
expiration  of its term by giving  HEALTHSOUTH  180 days  written  notice of his
intention to terminate such employment,  and at the expiration of said 180 days,
Scrushy's  employment  under this Agreement shall terminate and Scrushy shall be
entitled to receive,  as severance  compensation,  an amount equal to one year's
annual  base  salary  at  the  time  of  termination,  payable  at the  time  of
termination.

      (f) In the event that HEALTHSOUTH shall be acquired, merged or reorganized
in such a manner as to result in a change in control of HEALTHSOUTH, Scrushy may
terminate this  employment  under this  Agreement by giving  HEALTHSOUTH 30 days
written  notice  of his  intention  to  terminate  such  employment,  and at the
expiration of said 30 days,  Scrushy's  employment  under this  Agreement  shall
terminate and Scrushy shall be entitled to receive,  as severance  compensation,
an amount  equal to two years'  annual base  salary at the time of  termination,
payable at the time of termination.

Section 9.  Non-Competition.

      (a) In the event that  Scrushy's  employment  under this  Agreement  shall
terminate  during its term, for the period of time with respect to which Scrushy
is entitled to receive  compensation  hereunder after such termination,  Scrushy
shall not, directly or indirectly,  own, operate,  be employed by, be a director
of, act as a  consultant  for,  be  associated  with,  or be a partner or have a
proprietary interest in, any enterprise, partnership,  association, corporation,
joint  venture or other entity,  which is  competitive  with the  rehabilitation
business of HEALTHSOUTH,  or any subsidiary or affiliate thereof,  in any county
in a state where  HEALTHSOUTH or its  subsidiaries  or affiliates are conducting
such business at the time of such termination;  provided,  however, that if such
termination  shall occur as a result of the causes enumerated in Section 8(f) of
this  Agreement,  this Section 9 shall be void and shall be of no further  force
and effect.

      (b) The parties have entered into this Section 9 of this Agreement in good
faith and for the reasons set forth in the recitals  hereto and assume that this
Agreement is legally binding.  If, for any reason, this Agreement is not binding
because of its geographical scope or because of its term, then the parties agree
that this Agreement shall be deemed  effective to the widest  geographical  area
and/or  the  longest  period  of time  (but not in excess of one year) as may be
legally enforceable.

      (c)  Scrushy  acknowledges  that the  rights  and  privileges  granted  to
HEALTHSOUTH in this Section 9 are of special and unique  character,  which gives
them a peculiar  value,  the loss of which may not be  reasonably  or adequately
compensated  for by  damages in an action of law,  and that a breach  thereof by
Scrushy of this Agreement will cause  HEALTHSOUTH  great and irreparable  injury
and  damage.  Accordingly,  Scrushy  hereby  agrees  that  HEALTHSOUTH  shall be
entitled to remedies of  injunction,  specific  performance  or other  equitable
relief to prevent a breach of this Section 9 of this Agreement by Scrushy.  This
provision  shall not be  construed  as a waiver of any other  rights or remedies
HEALTHSOUTH may have for damages or otherwise.

Section 10. Non-Assignability.

      Scrushy shall not have the right to assign, transfer,  pledge, hypothecate
or dispose of any right to receive payments hereunder or any rights,  privileges
or  interest  hereunder,  all of  which  are  hereby  expressly  declared  to be
non-assignable and non-transferable,  except after termination of his employment
hereunder.  In the event of a violation of the provisions of this Section 10, no
further  sums  shall  hereafter  become due or  payable  by  HEALTHSOUTH  or its
subsidiaries  to Scrushy or his  assignee,  transferee,  pledgee or to any other
person  whatsoever,  and HEALTHSOUTH  shall have no further liability under this
Agreement to Scrushy.

Section 11. Binding Effect.

      The rights and obligations of HEALTHSOUTH and its subsidiaries  under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of HEALTHSOUTH. Scrushy shall not assign or alienate any interest of
his in this Agreement, except as provided in Section 10 hereof.

Section 12. Waiver of Breach.

      The waiver by either party to this  Agreement of a breach of any provision
thereof by the other party shall not operate or be  construed as a waiver of any
subsequent breach of such party.

Section 13. Notices.

      Any notice required or permitted to be given under this Agreement shall be
sufficient  if in  writing  and if  sent  by  certified  or  registered  mail to
Scrushy's  residence  (if  such  notice  is  addressed  to  Scrushy),  or to the
principal  executive  offices of  HEALTHSOUTH  in  Birmingham,  Alabama (if such
notice is addressed to HEALTHSOUTH).

Section 14. Entire Agreement.

      This instrument shall be governed by the laws of the State of Delaware and
contains the entire  agreement of the parties with respect to the subject matter
hereof and supersedes any other agreements, whether written or oral, between the
parties.

      This  Agreement  may not be changed  orally,  but only by an instrument in
writing  signed by the party  against whom  enforcement  of any waiver,  change,
modification, extension or discharge is sought.

Section 15. Counterparts.

      This Agreement may be executed in two or more counterparts,  each of which
shall for all purposes be deemed to be an original,  but each of which,  when so
executed, shall constitute but one and the same instrument.





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

                               HEALTHSOUTH Rehabilitation Corporation


                               By  /s/ Aaron Beam, Jr.
                                 ___________________________________
                                            Aaron Beam, Jr.
                                     Executive Vice President and
                                        Chief Financial Officer

                                   /s/ Richard M. Scrushy
                                  ___________________________________
                                           Richard M. Scrushy







                    AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT


      AMENDMENT  NO. 1 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 5, 1987,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23, 1986 (the 'Employment  Agreement');
and

      WHEREAS,   the  parties  desire  to  amend  the  Employment  Agreement  as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a) of the  Agreement is hereby  amended by  increasing  the
annual base salary effective after December 31, 1986,  previously  $180,000,  to
$200,000.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.


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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy





                    AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 2 TO EMPLOYMENT  AGREEMENT,  dated as of December 16, 1987,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987 (the 'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a) of the  Agreement is hereby  amended by  increasing  the
annual base salary  effective  after December 31, 1987,  previously  $200,000 to
$260,000.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy



                    AMENDMENT NO. 3 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 3 TO EMPLOYMENT  AGREEMENT,  dated as of December 20, 1988,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987 and as of December 16, 1987 (the 'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a) of the  Agreement is hereby  amended by  increasing  the
annual base salary  effective  after December 31, 1988,  previously  $260,000 to
$325,000.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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



                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy




                    AMENDMENT NO. 4 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 4 TO EMPLOYMENT  AGREEMENT,  dated as of December 20, 1989,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987,  as of  December  16, 1987 and as of  December  20, 1988 (the  'Employment
Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1. Section 2 of the Agreement is hereby  amended to extend the term of the
Agreement for a period of five years commencing January 1, 1990.

      2. Section 5(a) of the Agreement is hereby amended by the  substitution in
place thereof,  the following new Section 5(a): '(a) A base salary at the annual
rate of $450,000 effective January 1, 1990, such salary to be paid semi-monthly.
Such salary shall be reviewed annually by the Board of Directors.

      It is agreed  between  the parties  that  $60,000 of the above base salary
amount shall be considered to be an incentive  portion thereof,  payable only if
HEALTHSOUTH's  operations meet the standards set forth in  HEALTHSOUTH's  annual
business  plan,  as approved for each year during the term of this  Agreement by
the Board of Directors,  it being agreed that the main criteria to be considered
is  whether  HEALTHSOUTH  attains  the  level of net  income  set  forth in such
business plan. The $60,000 incentive portion shall be payable on a monthly basis
(1/12 with respect to each month of the  calendar  year) and shall be payable in
$5,000 increments within five days of the date HEALTHSOUTH's  internal financial
statements  have been  prepared and are  considered by management to be complete
and accurate.  In the event that any monthly  increment shall not be paid during
the course of a calendar  year because the business plan is not met, such amount
shall be due and payable at the time HEALTHSOUTH's  annual results are announced
to the public if  HEALTHSOUTH  attains the net income set forth in the  business
plan for the calendar year involved.'

      3. Section 8(f) of the Agreement is hereby amended by  substituting in the
place of the words 'two years'  annual  base  salary'  the words  'three  years'
annual base salary (including the gross incentive portion)'.

      4.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy





                    AMENDMENT NO. 5 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 5 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 8, 1991,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987,  as of December 16,  1987,  as of December 20, 1988 and as of December 20,
1989 (the 'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  2 of  the  Employment  Agreement  is  hereby  amended  by the
substitution in place thereof, the following new Section 2:

      'The term of employment  provided for in this Agreement  shall commence on
January 1, 1991,  and shall remain in full force and effect for a period of five
years  thereafter.  Such term shall be automatically  extended for an additional
year on each December 31, during the term hereof,  unless  written notice of any
non-extension is provided Scrushy at least 30 days prior to such December 31.'

      2.  Section  5(a)  of  the  Employment  Agreement  is  hereby  amended  by
increasing the annual base salary from $450,000 to $600,000,  effective  January
1, 1991.  The incentive  portion of this $600,000 base salary shall be $120,000,
payable in $10,000 increments on a monthly basis.

      3.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy




                    AMENDMENT NO. 6 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 6 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 1, 1992,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987, as of December 16, 1987, as of December 20, 1988, as of December 20, 1989,
and as of January 8, 1991 (the 'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a)  of  the  Employment  Agreement  is  hereby  amended  by
increasing the annual base salary from $600,000 to $730,000,  effective  January
1, 1992.  The incentive  portion of this $600,000 base salary shall be $180,000,
payable in $15,000 increments on a monthly basis.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy





                    AMENDMENT NO. 7 TO EMPLOYMENT AGREEMENT

      AMENDMENT  NO. 7 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 1, 1993,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').


                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987, as of December 16, 1987, as of December 20, 1988, as of December 20, 1989,
as of January 8, 1991 and as of  January 1, 1992 (the  'Employment  Agreement');
and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a)  of  the  Employment  Agreement  is  hereby  amended  by
increasing the annual base salary from $730,000 to $766,500,  effective  January
1, 1993.  The incentive  portion of this $730,000 base salary shall be $240,000,
payable in $20,000 increments on a monthly basis.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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



                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy




                    AMENDMENT NO. 8 TO EMPLOYMENT AGREEMENT


      AMENDMENT  NO. 8 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 1, 1994,
between  HEALTHSOUTH   Rehabilitation   Corporation,   a  Delaware   corporation
('HEALTHSOUTH'),  and  RICHARD M.  SCRUSHY,  a resident of  Birmingham,  Alabama
('Scrushy').

                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987, as of December 16, 1987, as of December 20, 1988, as of December 20, 1989,
as of  January  8,  1991,  as of  January 1, 1992 and as of January 1, 1993 (the
'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a)  of  the  Employment  Agreement  is  hereby  amended  by
increasing the annual base salary to $800,000, effective January 1, 1994.

      In addition to the above base salary,  Scrushy  shall be paid an incentive
bonus in the total amount of $400,000 per annum,  payable only if  HEALTHSOUTH's
operations meet the standards set forth in  HEALTHSOUTH's  annual business plan,
as  approved  for each year  during the term of this  Agreement  by the Board of
Directors,  it being agreed that the main  criteria to be  considered is whether
HEALTHSOUTH attains the level of net income set forth in such business plan. The
$400,000  incentive bonus shall be payable on a monthly basis (1/12 with respect
to each  month  of the  calendar  year)  and  shall  be  payable  in  $33,333.33
increments  within  five  days  of the  date  HEALTHSOUTH's  internal  financial
statements  have been  prepared and are  considered by management to be complete
and accurate.  In the event that any monthly  increment shall not be paid during
the course of a calendar  year because the business plan is not met, such amount
shall be due and payable at the time HEALTHSOUTH's  annual results are announced
to the public if  HEALTHSOUTH  attains the net income set forth in the  business
plan for the calendar year involved.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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


                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy





                    AMENDMENT NO. 9 TO EMPLOYMENT AGREEMENT


      AMENDMENT  NO. 9 TO  EMPLOYMENT  AGREEMENT,  dated as of  January 1, 1995,
between HEALTHSOUTH  Corporation,  a Delaware corporation  ('HEALTHSOUTH'),  and
RICHARD M. SCRUSHY, a resident of Birmingham, Alabama ('Scrushy').

                              W I T N E S S E T H:

      WHEREAS,  the  parties  to this  Agreement  are  parties  to that  certain
Employment  Agreement,  dated as of July 23,  1986,  as amended as of January 5,
1987, as of December 16, 1987, as of December 20, 1988, as of December 20, 1989,
as of January 8, 1991, as of January 1, 1992,  as of January 1, 1993,  and as of
January 1, 1994 (the 'Employment Agreement'); and

      WHEREAS,  the parties desire to further amend the Employment  Agreement as
hereinafter set forth.

      NOW, THEREFORE,  in consideration of the premises, and the mutual promises
and covenants  hereinafter  contained,  HEALTHSOUTH and Scrushy do hereby agree,
for their mutual benefit, as follows:

      1.  Section  5(a)  of  the  Employment  Agreement  is  hereby  amended  by
increasing the annual  incentive bonus for 1995 to a total of $900,000,  payable
only if  HEALTHSOUTH's  operations meet the standards set forth in HEALTHSOUTH's
annual  business  plan,  as  approved  for  each  year  during  the term of this
Agreement by the Board of  Directors,  it being agreed that the main criteria to
be considered is whether  HEALTHSOUTH  attains the level of net income set forth
in such  business  plan.  The  $900,000  incentive  bonus  shall be payable on a
monthly  basis (1/12 with respect to each month of the calendar  year) and shall
be payable  in $75,000  increments  within  five days of the date  HEALTHSOUTH's
internal  financial   statements  have  been  prepared  and  are  considered  by
management to be complete and accurate.  In the event that any monthly increment
shall not be paid during the course of a calendar year because the business plan
is not met,  such  amount  shall be due and  payable  at the time  HEALTHSOUTH's
annual results are announced to the public if HEALTHSOUTH attains the net income
set forth in the business plan for the calendar year involved.

      2.  HEALTHSOUTH  and Scrushy  hereby  reaffirm  all of the other terms and
provisions of the Employment  Agreement,  which is amended only as  specifically
set forth herein.

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



                               HEALTHSOUTH Rehabilitation Corporation


                               By   /s/ Aaron Beam, Jr.
                                 ___________________________________
                                        Aaron Beam, Jr., Senior
                                  Vice President and Chief Financial
                                         Officer and Treasurer


                                    /s/ Richard M. Scrushy
                                  ___________________________________
                                          Richard M. Scrushy