Exhibit 10.4
OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMANCE
UNDERTAKING
THIS
OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMANCE
UNDERTAKING, dated as of November 14, 2006 (this "Waiver"), is by
and among:
(a) Invacare Corporation, an Ohio corporation ("Invacare"),
Healthtech
Products, Inc., a Missouri corporation, and Invacare Supply Group, Inc.,
a
Massachusetts
corporation (each of the foregoing including Invacare, an
"Originator" and collectively, the "Originators"),
(b) Invacare
Receivables
Corporation, a
Delaware corporation ("IRC"
and,
together with the Originators, the "Companies"),
(c) Park Avenue
Receivables Company, LLC ("Conduit"), and
(d) JPMorgan Chase Bank, N.A., individually (together with Conduit,
the
"Purchasers") and as agent (together with its successors and
assigns in
such
capacity, the "Agent").
W I T N E S S E T H :
WHEREAS, the
Originators
and IRC are parties to that certain
Receivables Sale
Agreement,
dated
as of September 30, 2005 (the
"Receivables Sale Agreement");
WHEREAS, IRC, as Seller, Invacare, as Servicer, the Purchasers and
the
Agent are parties to that certain Receivables Purchase Agreement dated as
of
September 30, 2005, as
heretofore amended
(the "Receivables
Purchase
Agreement" and,
together
with the Receivable Sale Agreement, the
"Agreements");
WHEREAS, Invacare has
executed that certain
Performance
Undertaking
dated as of
September 30, 2005, in favor of IRC (the "Performance
Undertaking); and
WHEREAS, the parties
wish to (a) waive a Termination Event under the
Receivables Sale Agreement and an Amortization Event under the Receivables
Purchase Agreement,
(b) amend the Receivables Purchase Agreement, and (c)
reaffirm the
Performance
Undertaking,
in each case, on the terms and
subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises herein contained,
and
for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:
<page>
1. Defined
Terms. Capitalized terms used herein and not
otherwise
defined shall
have their meanings as attributed to such terms in the
Agreements.
2. Limited Waivers; Amendment.
2.1. Limited Waivers.
(a) Any Potential Termination Event or Termination Event that
may
have arisen (or that may at any time hereafter prior to December 15,
2006 arise) under Section 5.1(c) of the Receivables Sale Agreement by
virtue of Invacare's
failure to
observe at all times
the financial
covenant set
forth in Section 11.3 of each of the note purchase
agreements executed in
connection with the Senior Unsecured Notes (as
defined in
the Five-Year Credit Agreement) and incorporated by
reference into
Section 5.2(k) of the Five-Year Credit Agreement
(collectively, the
"Cross-Defaults") is
hereby waived for the period
commencing on the date
hereof through
the earliest to occur of (i)
December 15, 2006, (B) any Potential Termination Event or
Termination
Event other than the Cross Defaults, (C) the breach or
nonperformance
by any of the
Companies of any
covenant, agreement or
condition set
forth in this Waiver,
and (D) the date on which any representation or
warranty in Section 3 hereof fails to be true and correct.
(b) Any Amortization
Event or Potential
Amortization Event that
may have arisen (or that may at any time hereafter prior to December
15, 2006 arise)
under Section 9.1(c) of the Receivables Purchase
Agreement by virtue of
the Cross-Defaults
is hereby waived for the
period commencing on
the date hereof through the earliest to occur of
(i) December
15, 2006, (B) any Potential Amortization Event or
Amortization Event
other than the Cross
Defaults, (C) the
breach or
nonperformance by any
of the Companies of any covenant, agreement or
condition set
forth in this
Waiver, and (D) the date on which
any
representation or
warranty in Section 3
hereof fails to be
true and
correct.
2.2. Amendments.
(a) The definitions
of the following
terms in the
Receivables
Purchase Agreement are
hereby amended and
restated in their entirety
to read as follows:
"Dilution Stress Factor" means (a) at any time the Servicer's
ratio of Total Debt to Adjusted EBITDA is less than 3.0, 1.75, (b)
at
any time between September 28, 2006 and the Liquidity Termination
Date
until the Agent otherwise notifies the Seller Parties, 1.75, and
(c) at
any other time unless the Agent otherwise notifies the Seller
Parties,
2.00.
"Liquidity Termination
Date" means December 15, 2006 or such
later date as extended pursuant to the terms of this Agreement.
"Loss Ratio" means, as of any Cut-Off Date, the ratio (expressed
as a percentage)
computed by
dividing (a) the sum of (i) the total
Outstanding Balance of
Defaulted Receivables
plus (ii) the amount of
Receivables which
b
