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AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT

Waiver Agreement

AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT | Document Parties: ENCORE MEDICAL IHC, INC.,  | BANK OF AMERICA, N.A.,  | ENCORE MEDICAL CORPORATION You are currently viewing:
This Waiver Agreement involves

ENCORE MEDICAL IHC, INC., | BANK OF AMERICA, N.A., | ENCORE MEDICAL CORPORATION

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Title: AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT
Governing Law: New York     Date: 1/19/2006
Industry: Medical Equipment and Supplies    

AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT, Parties: encore medical ihc  inc.   , bank of america  n.a.   , encore medical corporation
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Exhibit 4.4

AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT

Dated as of December 20, 2005

           AMENDMENT AND WAIVER NO. 4 TO THE CREDIT AGREEMENT (this “ Amendment ”) among ENCORE MEDICAL IHC, INC., a Delaware corporation (the “ Borrower ”), ENCORE MEDICAL CORPORATION, a Delaware corporation (“ Holdings ”), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the “ Lenders ”) and BANK OF AMERICA, N.A., as Administrative Agent (in such capacity, the “ Administrative Agent ”).

PRELIMINARY STATEMENTS:

          (1) WHEREAS, the Borrower, Holdings, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of October 4, 2004, as amended by Letter Amendment and Waiver No. 1, dated as of February 14, 2005, Amendment and Waiver No. 2, dated as of May 5, 2005 and Letter Amendment No. 3, dated as of July 21, 2005 (such Credit Agreement, as so amended, the “ Credit Agreement ”). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement;

          (2) WHEREAS, the Borrower has requested that the Lenders amend and waive certain provisions to the Credit Agreement as described below and including, without limitation, an increase of the Revolving Credit Commitments; and

          (3) WHEREAS, the Lenders have agreed, subject to the terms and conditions hereinafter set forth, to amend and waive certain provisions to the Credit Agreement as set forth below.

          NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto hereby agree as follows:

          SECTION 1. Amendments to the Credit Agreement . The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 3 hereof, hereby amended as follows:

          (a) Section 1.01 of the Credit Agreement is hereby amended as follows:

     (i) By deleting, in clause (iv) of the definition of “ Consolidated EBITDA ” the amounts “$10,000,000” and “$5,000,000” and by replacing such amounts with, respectively, the amounts “$20,000,000” and “$15,000,000”.


 

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     (ii) By deleting in the definition of “ Consolidated EBITDA ” clause (vi) thereof and by inserting the following clause (vi) in its place:

“(vi) restructuring and integration costs incurred (A) in connection with the Transaction through December 31, 2005; provided that the maximum amount of costs incurred under this subclause (A) shall not exceed $5,000,000, and (B) in connection with the Compex Acquisition through the date that is twelve months after the Fourth Amendment Effective Date; provided that the maximum amount of costs incurred under this subclause (B) shall not exceed $7,500,000,”

     (iii) By deleting in the definition of “ Consolidated EBITDA ” clause (viii) thereof and by inserting the following clause (viii) in its place:

“(viii) transaction fees and expenses related to (A) attempted or completed acquisitions (other than the Transaction) up to a maximum aggregate amount of $2,500,000 during any period of four consecutive Fiscal Quarters, and (B) the Compex Acquisition up to a maximum aggregate amount of $4,500,000,”

     (iv) By inserting at the end of the definition of “ Revolving Credit Commitment ” the following phrase: “; provided , however , that upon the Compex Acquisition Closing Date the Revolving Credit Commitments shall be increased by the commitments set forth on Schedule 2.01(a) hereto.”

(v) By inserting the following new definitions therein in the appropriate alphabetical order:

Compex Acquisition ” means the acquisition by the Borrower of all of the Equity Interests in Compex Technologies, Inc. a Minnesota corporation pursuant to that certain stock purchase agreement dated as of November 11, 2005 and entered into by and among Holdings, Encore-Snow Acquisition Corp. and Compex Technologies, Inc.; provided that, after giving effect to such acquisition, Compex Technologies, Inc. shall be a wholly-owned direct Subsidiary of the Borrower.

Compex Acquisition Closing Date ” means the date Compex Technologies, Inc. merges with and into Encore-Snow Acquisition Corp. as part of the Compex Acquisition, it being understood that the Compex Acquisition Closing Date shall occur on or before June 30, 2006.

Fourth Amendment ” means the Amendment No. 4, dated as of December 20, 2005, to this Agreement among the Borrower, Holdings, the Lenders party thereto and the Administrative Agent.

Fourth Amendment Effective Date ” has the meaning specified in Section 2 of the Fourth Amendment.

     (b) Section 7.03(i)(D) of the Credit Agreement is hereby amended by deleting therein the amounts “$7,500,000” and “$15,000,000” and by replacing such amounts with, respectively, the amounts “$15,000,000” and “$30,000,000”.


 

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          Section 7.11 of the Credit Agreement is hereby amended by deleting therein the schedule of Capital Expenditures and by replacing such schedule with the following schedule:

 

 

 

 

 

“Fiscal Year

 

Amount

 

2004

 

$

11,100,000

 

2005

 

$

13,800,000

 

2006

 

$

13,000,000

 

2007

 

$

14,200,000

 

2008

 

$

15,700,000

 

2009

 

$

17,300,000

 

2010

 

$

19,000,000

” 

     (c) A new Schedule 2.01(a) is added to the Credit Agreement in the form of Schedule I to this Amendment.

          SECTION 2. Waiver . Compliance by Holdings and its Subsidiaries with the limitations set forth in Section 7.03(i)(D) of the Credit Agreement, with respect to the limits on total cash consideration that may be paid by or on behalf of Holdings and its Subsidiaries for any purchase or acquisition of the type described in Section 7.03(i) of the Credit Agreement of no more than $15,000,000 after giving effect to the amendment set forth in Section 1(b) above for any single transaction, is on and as of the Fourth Amendment Effective Date hereby waived by the Lenders, solely to the extent and for the purpose of permitting the Compex Acquisition and the repayment of debt of Compex Technologies, Inc., assoc


 
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