Exhibit 10.3
WAIVER AND AMENDMENT AGREEMENT
THIS
WAIVER AND AMENDMENT AGREEMENT (this "Agreement"), dated as of
November 14, 2006, to that certain Credit Agreement dated as of
January 14, 2005
(as amended,
restated or
otherwise modified prior to the date hereof and
as
amended or otherwise modified hereby or from time to time in
accordance with the
terms hereof and thereof, the "Credit Agreement") among Invacare Corporation
(the "Company"), each
of the Borrowing Subsidiaries party thereto (collectively
with the Company, the
"Borrowers"), the
banks set forth on the signature pages
thereof (together with their successors and assigns, collectively, the "Banks"
and each individually
a "Bank") and JPMorgan Chase Bank, N.A., a national
banking association, as agent for the Banks (in such capacity, the
"Agent").
RECITALS:
A.
The Borrowers,
the Banks and the
Agent have
entered into the Credit
Agreement under which
the Banks have agreed
to provide loans to,
and issue or
participate in letters of credit for the account of, the Borrowers
in accordance
with the terms of the Credit Agreement.
B. A Default has
occurred under the Credit Agreement due to a default under
a financial covenant
in the Senior
Unsecured Notes which
is incorporated
by
reference into the
Credit Agreement
pursuant to Section
5.2(k) of the
Credit
Agreement.
Specifically, the
financial covenant set forth in Section 11.3
of
each of the note
purchase agreements
executed in
connection
with the Senior
Unsecured Notes (the
"Note Purchase
Agreements") is in
default as of the date
hereof as such financial covenant in the Note Purchase Agreements is tested "at
any time". As this more frequent testing is more favorable to the
holders of the
Senior Unsecured Notes, the Banks are entitled to the incorporation
by reference
of Section 11.3 into the Credit Agreement under the terms of Section 5.2(k)
of
the Credit Agreement.
As a result of the breach of Section 5.2(k) of the Credit
Agreement and the
breach of Section 11.3 of the Note Purchase Agreements,
Defaults have also occurred under Section 6.1(c) of the Credit
Agreement (due to
the past
misrepresentations by the Company that no Default had occurred and
was
continuing) and
Section 6.1(f) (as a result of the declared defaults under the
Note Purchase
Agreement).
The breach of Section 11.3 of each of the Note
Purchase Agreements
as incorporated by reference into the Credit Agreement
pursuant to Section 5.2(k) of the Credit Agreement and the breaches of
Sections
6.1(c) and 6.1(f) of the Credit Agreement are referred to herein
collectively as
the "Existing Defaults". The Borrowers hereby acknowledge the
Existing Defaults.
C.
The Agent and the Banks have the right under the Credit Agreement to
accelerate immediately the Borrowers' obligations under the Credit
Agreement and
the other Loan
Documents and
otherwise to exercise,
or cause to be exercised,
all respective
rights and remedies
available to the Agent
and the Banks under
such documents, as applicable, and under law and in equity.
D.
The Company has requested that the Banks temporarily waive the Existing
Defaults under the
Credit Agreement
for the period set
forth herein and
have
asked the Banks to agree to amend certain terms and provisions of the Credit
Agreement in accordance with the terms and conditions set forth
herein.
E.
The Banks which are signatories hereto are willing to waive such
Existing Defaults for
such limited period
and the Banks which are signatories
hereto are willing to make such amendments, all on the terms and conditions
set
forth herein.
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NOW,
THEREFORE, upon the
full and complete
satisfaction of the conditions
precedent to the
effectiveness
of the Waivers and the Amendments, and in
consideration of good and valuable consideration, the receipt and
sufficiency of
which is hereby
acknowledged, the
Borrowers and the Banks do hereby agree
as
follows:
SECTION 1.
Temporary Waiver.
1.1
Each Borrower hereby
acknowledges and
agrees that, as a result of the
Existing Defaults under the Credit Agreement, the Banks may proceed to
enforce
their rights and
remedies under and in accordance with the Loan Documents,
including without limitation to collect the Borrowers' obligations
to the Banks.
1.2
Subject to the terms and conditions of this Agreement, the Banks agree
to temporarily waive (the "Waiver") the Existing Defaults during
the period (the
"Waiver Period")
commencing on the date
hereof and expiring on the earliest to
occur of (A) December 15, 2006 (the "Outside Waiver Termination
Date'), (B) any
Default or Event of
Default under any Loan
Document other than the Existing
Defaults, (C) the
breach or
nonperformance by the Company or any Subsidiary of
any covenant,
agreement or condition set forth in this Agreement, and (D) the
date on which any
representation or
warranty in Section 3
hereof fails to be
true and correct.
1.3
The Waiver shall be effective only for the Existing Defaults and only
for the Waiver Period,
and such Waiver shall
not entitle the
Borrowers to any
future waiver in similar or other circumstances and shall
automatically cease to
be effective upon the
expiration of the Waiver Period, without notice or other
action of any kind by the Agent or the Banks. The Agent and the Banks
reserve
their respective
rights, in their
discretion, to
exercise any or all of their
rights and
remedies under the Loan Documents as a result of the Existing
Defaults upon
the expiration of the Waiver Period. Without limiting the
foregoing, upon the
expiration of the Waiver Period, a Default will exist under
the Credit Agreement
and the Agent
shall, upon the request of the Required
Banks, without
the need for the expiration of grace periods, if any, in
connection with the
Existing Defaults,
(but otherwise in
accordance with
the
terms of the Credit Agreement), accelerate the payment in full of the
obligations owed to
the Agent and the Banks under the Loan Documents, and
enforce and exercise any or all of the Agent's rights under or in
respect of the
Credit Agreement and the other Loan Documents and under applicable
law.
SECTION 2.
Amendments to the Credit Agreement.
Subject to the terms and conditions of this Agreement, the Credit
Agreement
is hereby and shall be amended as follows:
2.1
Notwithstanding
anything to the contrary contained in the Credit
Agreement, the aggregate principal amount of new Advances
outstanding during the
Waiver Period (other than the Advance on or about the Waiver
Effective Date in
the approximate
amount of $15,742,310.21 for the purpose of refunding the
overdraft owing
to National City Bank and other than continuations and
conversions of
Advances outstanding
on the Waiver
Effective Date in the
same
principal amount)
shall not exceed the lesser of (i) $20,000,000, and (ii) the
amount that would not cause the aggregate amount of Consolidated Total Debt,
after giving effect to such new Advance, to exceed $520,762,617.58.
After giving
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effect to the Advance
repaying such overdraft owing to National City Bank,
the
aggregate principal
amount of Advances under the Credit Agreement will be
$140,909,307.37 (the
amount of existing loans under the Credit Agreement +
$15,742,310.21 (the amount of the loan to refund the overdraft
owing to National
City Bank + $1,242,000 (the current amount of letters of credit
issued under the
Credit Agreement) (the "Waiver Effective Date Advance Amount"). All
new Advances
shall be used solely for working capital purposes in the ordinary course of
business. In
connection
with each request for
an Advance under Section 2.8 of
the Credit Agreement,
the Company
shall deliver any certificate reasonably
requested by the Agent to demonstrate compliance with the borrowing
limitations
set forth herein as of the date such Advance is made, continued or
converted and
after giving effect to such Advance.
2.2
Notwithstanding
anything to the contrary contained in the Credit
Agreement, (i)
principal payments shall be required on Advances
outstanding
under the Credit
Agreement that are in excess of the
Waiver Effective Date
Advance Amount to the
extent cash on hand is in excess of the amount of cash on
hand historically
maintained
in the ordinary course of business; (ii) no
principal payments
shall be made or
required on the Advances below the Waiver
Effective Date Advance Amount without the prior written
consent of the
Required
Banks, (iii) no
principal payments on the Senior Unsecured Notes or other
existing Indebtedness
shall be permitted
without the prior
written consent of
the Required Banks,
and (iv) any principal
payments below the Waiver Effective
Date Advance Amount
under clause (ii) above and any principal payments on the
Senior Unsecured
Notes under clause
(iii) above shall be made pro rata between
the obligations
outstanding
under the Credit
Agreement and the obligations
outstanding under the Senior Unsecured Notes.
2.3
Notwithstanding
anything to the contrary contained in the Credit
Agreement, the Applicable Fee Rate for the facility fee paid
pursuant to Section
2.5 of the Credit
Agreement shall be
thirty basis
points (30 bps) during
the
Waiver Period.
2.4
Notwithstanding
anything to the contrary contained in the Credit
Agreement, the
Applicable
Margin for
Eurocurrency
Rate Loans shall be one
hundred twenty basis points (120 bps) during the Waiver Period.
2.5
Notwithstanding
anything in the Credit Agreement to the contrary,
neither the Company nor any Subsidiary may, after the date hereof
and continuing
through April 15, 2007:
(a) grant any Liens in
reliance on the basket provided in Section
5.2(d)(ix) of the Credit Agreement;
(b) sell, lease, license, transfer or otherwise dispose of any
assets, other than (i)
inventory sold in the ordinary course of
business on
customary terms, (ii) the sale of a building in
Europe with approximate sale proceeds of $3,000,000, (iii) sales
permitted pursuant to
Section 5.2(f)(i) of
the Credit Agreement
related to
Securitization
Transactions and (iv)
transfers or
other dispositions
related to Investments
permitted pursuant to
Section 5.2(i) of the Credit Agreement and this Agreement;
(c) make any
Investments
in reliance on the basket provided in
Section 5.2(i)(xi) of
the Credit Agreement,
other than loans to
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customers for short
term liquidity
not to exceed an
aggregate
outstanding principal amount at any time of $2,000,000; or
(d) declare or pay any
dividend on the capital stock of the Company,
other than the
regularly scheduled
quarterly dividends to the
Company's shareholders not to exceed $0.0125 per share.
2.6
The Company
covenants and agrees that on the Monday of
each week (or
the next Business Day
if Monday is a holiday), the Company will furnish to
the
Agent a statement of the Company's and its Subsidiaries' cash
balances as of the
close of business on the Friday of the immediately preceding week (or the first
Business Day immediately preceding Friday if Friday is a
holiday).
2.7
The Company covenants and agrees that all material bank accounts of
the
Company and each Domestic Subsidiary will be maintained at a
Bank.
2.8
The following
definitions
are added to Section 1.1 of the Credit
Agreement in appropriate alphabetical order:
"Material Adverse
Effect" means a material adverse effect on (a) the
business, assets,
operations,
prospects or
condition, financial
or
otherwise, of the
Company and the Subsidiaries taken as a whole,
(b) the ability of any
Borrower to perform any of its obligations
under this Agreement or (c) the legality, validity, binding effect or
enforceability against
the Company and its Subsidiaries of the Credit
Agreement.
"Note Purchase
Agreements" means each of the note purchase agreements
pursuant to which the Senior Unsecured Notes have been issued.
"Securitization
Facility" means the
existing $100 million
accounts
receivable securitization facility of the Company.
"Securitization Waiver" means the waiver/amendment
to the
Securitization
Facility attached hereto as Exhibit A and delivered on
the Waiver Effective Date
"Waiver Effective Date" shall mean November 15, 2006.
2.9
The definition of "Senior Secured Notes" in Section 1.1 is
restated as
follows:
"Senior Unsecured Notes" means the 6.71% Senior Notes due February
27,
2008, issued in an aggregate original principal amount of
$80,000,000
under that certain
Note Agreement dated as of February 27, 1998
between the Borrower and the Purchasers named therein, the Series A
Senior Unsecured
Notes due October 1,
2007 issued on October 1, 2003
in the aggregate original principal amount of $50,000,000,
the Series
B Senior Unsecured Notes due October 1, 2009 issued on October 1,
2003
in an aggregate original principal amount of $30,000,000, the
Series C
Senior Unsecured
Notes due October 1,
2010 issued on October 1, 2003
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in an aggregate
principal amount of
$20,000,000 and the 6.15% Senior
Unsecured Notes due April 27, 2016 in an aggregate original principal
amount of $150,000,000.
2.10
Section 2.8 is amended by adding the following sentence at the end of
the last paragraph of such Section:
In connection with each request for an Advance under this Section
2.8,
the Company shall deliver any certificate reasonably requested by the
Agent to demonstrate
compliance
with Section 5.2(o) of the Credit
Agreement as of the date such Advance is made, continued or converted
and after giving effect to such Advance.
2.11
Section 4.13 is restated as follows:
4.13 No Material
Adverse Effect. Since the most recent financial
information delivered
by the Company to the Agent prior to the Waiver
Effective Date,
there has been no change in the business, property,
prospects, condition
(financial or
otherwise) or results of operations of
the
Company and its
Subsidiaries which,
could reasonably be expected to
have
a Material Adverse Effect.
2.12
Section 5.2(i)(i) is restated as follows:
(i) Investments by the Company in and to Subsidiaries, and
Investments
by
Subsidiaries in and to the Company and other Subsidiaries,
including any
Investment in a corporation which, after giving effect to such
Investment,
will
become a Subsidiary and including any Investment in any
Securitization
Entity, provided,
that, with respect to any Investments comprised of
inter-company loans
made by a Subsidiary to any Borrower, such loans are
unsecured and
subordinated
to the obligations outstanding under this
Agreement on terms and conditions satisfactory to the Required
Banks, and
provided, further,
in each case under this clause (i), so long as
immediately
before and after
giving effect to any such Investments, no
Default or Event of Default would exist;
2.13 New Sections
5.2(n) and (o) shall be added at the end of Section
5.2
to read as follows:
(n) Optional Payments
and Modification of
Indebtedness.
During the
period from the Waiver
Effective Date and
continuing
through April 15,
2007, will not, nor will it permit any Subsidiary to, (i) make any
optional
payment, defeasance
(whether a covenant
defeasance,
legal defeasance
or
other defeasance), prepayment, repurchase (including without
limitation any
offer to repurchase) or other optional redemption of any Senior
Unsecured
Notes or any other Indebtedness (other than under the Credit
Agreement) or
obligations in connection therewith, other than, with the consent of the
Required Banks, principal payments which are made on a pro rata
basis among
the
holders of the Senior
Unsecured Notes and
Advances under the Credit
Agreement, (ii) enter
into any agreement
restricting
the ability of the
Company and its
Subsidiaries to amend
or modify any Loan Document, other
than
restrictions
contained in the Note
Purchase Agreements or any NPA
Waiver, (iii)
enter into any agreement or arrangement requiring any
defeasance of any kind of any of the Senior Unsecured Notes, (iv) amend,
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supplement or
otherwise modify the Senior Unsecured Notes, the Note
Purchase Agreements or any agreements or instruments executed in
connection
therewith other than pursuant to the waiver/amendment to the Note
Purchase
Agreements attached
hereto as Exhibit B and delivered on the Waiver
Effective Date
(the "NPA Waiver"), or (v) pay or agree to pay any
fee,
interest or other
compensation
or consideration to the holders of the
Senior Unsecured
Notes other than as required by the Note Purchase
Agreements and Senior
Unsecured Notes in effect on the Waiver
Effective
Date, as modified by the NPA Waiver.
(o) Consolidated
Total Debt. During the period from the Waiver
Effective Date and continuing through April 15, 2007,
permit or suffer
to
exist the aggregate outstanding principal amount of Consolidated
Total Debt
of
the Company and its Subsidiaries at any time to exceed
$520,762,617.58.
2.14
Section 6.1(d) is restated as follows:
(d) Certain Covenants.
Any Borrower shall
fail to perform or observe
any
term, covenant
or agreement contained in Section 5.1(d)(i)(A) or
Section 5.2(a),
(b), (c), (e), (f),
(n) or (o) hereof or contained in the
Waiver and Amendment to this Agreement dated November 14, 2006;
or
2.15
Each of the Borrowers
acknowledges
and agrees
that any covenants,
defaults or similar
provisions set forth
in the NPA Waivers not
substantially
provided for in this
Agreement or more
favorable to the
holders of the Senior
Unsecured Notes are hereby incorporated by reference into
this Agreement to the
same extent as if set forth fully herein, and no subsequent
amendment,
waiver,
termination or
modification
thereof shall affect
any such covenants,
terms,
conditions or defaults as incorporated herein.
2.16
For avoidance of doubt, it is hereby, it is hereby acknowledged and
agreed to by the Company that the addition of the agreements and covenants in
this Section 2 hereof and their continuance beyond the Waiver Period are not
to
be construed as an
acquiescence or waiver
of the Existing
Defaults beyond the
Waiver Period but are
added for additional
protection
of the Banks,
and the
Banks shall retain all of their rights and remedies under or in respect of the
Credit Agreement
and the other Loan
Documents and under
applicable
law with
respect to the Existing Defaults upon the expiration or termination of the
Waiver Period.
SECTION 3.
Representations and Warranties of the Borrowers.
To
induce the Banks to execute and deliver this Agreement (which
representations and
warranties shall survive the execution and delivery of this
Agreement), each Borrower represents and warrants to each of them
that (it being
agreed, however,
that nothing in this Section 3 shall affect any of the
warranties and
representations
previously made by the Borrowers in or pursuant
to the Loan Documents and that all of such other warranties and
representations
(except to the extent waived under Section 1 hereof), as well as the warranties
and representations
in this Section 3,
shall survive the
effectiveness of the
Waiver set forth in this Agreement):
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(a) this Agreement has been duly authorized, executed and delivered
by
each
Borrower and this Agreement constitutes the legal,
valid and binding
obligation, contract
and agreement of each Borrower, as applicable,
enforceable against
such Person in
accordance with its
terms, except as
enforcement may be
limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles relating to or
limiting
creditors' rights generally;
(b) the Loan
Documents constitute the legal, valid and binding
obligations, contracts
and agreements of each Borrower party thereto,
enforceable against it in accordance with their respective terms,
except as
enforcement may be
limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles relating to or
limiting
creditors' rights generally;
(c) the execution and delivery of this Agreement by each Borrower,
and
the
performance
each Borrower of the Loan Documents to which they are a
party (i) have been
duly authorized
by all requisite
corporate or other
action and,
if required, shareholder action, (ii) do not require the
consent or approval of any governmental or regulatory body or
agency, and
(iii) will not
(A) violate
(1) any provision of law, statute, rule or
regulation or its certificate of incorporation, bylaws or other charter or
organizational
documents, (2)
any order of any court or any rule,
regulation or order of any other agency or government binding upon it, or
(3)
any provision of any indenture, agreement or other instrument to
which
it
is a party or by which its properties or assets are or may be bound,
(B)
result in a breach or constitute (alone or with due notice or lapse
of
time
or both) a default under any indenture, agreement or other
instrument,
or
(C) result in the creation of any Lien;
(d) all the
representations and
warranties made by the
Borrowers in
the
Loan Documents
are true and
correct on the date
hereof as if made on
and
as of the date hereof and are so repeated herein as if expressly set
forth herein or therein, except (i) those representations and warranties
included in the
Existing Defaults and
(ii) to the extent that any of such
representations and
warranties expressly
relate by their terms to a prior
date;
(e) (i) Schedule
3(e) sets forth a
complete and correct
list of all
outstanding Indebtedness of the Company and its Subsidiaries as of
the date
hereof in an aggregate principal amount (for each such item of
Indebtedness) exceeding $1,000,000 (including a description of the
obligors
and
obligees, principal amount outstanding and collateral therefor, if
any,
any
guaranty thereof, if
any, any Liens securing such Indebtedness, and a
list
of the dates and amounts of any scheduled prepayments thereof), and
(ii)
the amount of all
outstanding
Indebtedness of the
Company and its
Subsidiaries not listed on such Schedule does not exceed
$1,000,000;
(f) the amount of
Consolidated
Total Debt of the Company and its
Subsidiaries (as defined in and as calculated under the Credit Agreement)
as
of November 14, 2006 is $500,762,617.58 and is detailed on Schedule
3(f)
hereto;
(g) except as disclosed in Schedule 3(g), there are no actions,
suits
or
proceedings
pending or, to the
knowledge of the
Company, threatened
against or affecting
the Company or any
Subsidiary or any property of the
Company or any Subsidiary in any court or before any arbitrator of
any kind
or
before or by any
governmental authority
that, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect;
(h) except for the
Existing Defaults,
no event has
occurred and no
condition exists that would constitute a Default or Event of
Default;
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(i) no principal or interest payments are due on the Senior
Unsecured
Notes at any time on or before December 15, 2006; and
(j) the NPA
Waiver and the Securitization Waiver are effective
simultaneously
herewith, and no default or other event or condition exists
which would cause, or permit the holders of the Indebtedness (or a trustee
on
behalf of such holders) under any of Senior Unsecured Notes or any
other
Indebtedness or any
holder of any of the obligations owing under the
Securitization
Facility to cause,
any payment of such Indebtedness or
obligations to become due prior to its due date.
SECTION 4.
Conditions to Effectiveness of the Waiver.
The
Waiver shall not become effective until, and shall become
effective on
the date (the
"Effective
Date") when each and every one of the following
conditions shall have
been satisfied or waived, provided that such conditions
have been satisfied on or before November 15, 2006:
(a) counterparts
of this Agreement
shall have been duly
executed by
each
Borrower, the Agent and the Required Banks;
(b) the NPA Waiver and the Securitization Waiver shall be executed
simultaneously herewith and be effective;
(c) the Company shall have paid fees in accordance with the terms of
any
fee letters between the Company and the Agent dated the date
hereof;
(d) after giving effect to the amendments and waiver contained
herein,
the
NPA Waiver and the
Securitization
Waiver, the representations and
warranties of each
Borrower set forth in
Section 3 hereof and
in Section
Article IV of the Credit Agreement shall be true and correct on and with
respect to the date hereof and on the Waiver Effective Date;
and
(e) after giving effect to the amendments and waiver contained
herein,
the
NPA Waiver
and the Securitization Waiver, no Default or Events of
Default shall exist other than the Existing Defaults.
SECTION 5.
Fees and Expenses.
The Company agrees to
pay and to save the Agent harmless for the payment of all
costs and expenses
arising in connection
with this Agreement, including the
reasonable fees of
counsel to the Agent in connection with preparing this
Agreement and the related documents.
SECTION 6.
Waiver and Release.
Without limiting the
foregoing,
in order to induce the
Agent and the Banks to
enter into this waiver, the Borrowers acknowledge and agree that: (a) neither
any Borrower nor any of their respective Subsidiaries has any claim or
cause of
action against any of the Agent, any Bank or any of their
respective
directors,
trustees, officers,
employees or agents (collectively, the "Released Parties")
relating to or arising
out of the Loan
Documents or any of the transactions
related thereto;
(b) neither any Borrower nor any of their respective
Subsidiaries has any offset right, right of recoupment,
counterclaim or
defense
of any kind
against any of their respective obligations, indebtedness or
liabilities to any of the Released Parties; (c) each of the
Released Parties has
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heretofore properly
performed and satisfied in a timely manner all of its
obligations to the Borrowers and their Subsidiaries under the Loan Documents,
and (d) neither the Agent nor any Bank has any obligation to make
any Advance on
or after December 15, 2006. Notwithstanding this representation and as
further
consideration for
the agreements and understandings herein, each of the
Borrowers, on behalf
of itself and its
employees, agents,
executors,
heirs,
successors and assigns (the "Releasing Parties"), hereby releases the Agent and
the Banks,
their respective predecessors, officers, directors, employees,
agents, attorneys,
affiliates,
subsidiaries,
successors and assigns, from any
liability, claim,
right or cause of action which now exists or hereafter arises
as a result of acts,
omissions or events occurring on or prior to the date
hereof, whether known
or unknown, including
but not limited to claims arising
from or in any way
related to the Loan
Documents or any of the transactions
relating thereto.
No Released
Party shall be liable
with respect to, and each
Borrower hereby
waives, releases and agrees not to sue for, any special,
indirect or
consequential damages
relating to any Loan Document or arising out
of its activities in connection herewith or therewith (whether before, on or
after the date hereof).
SECTION 7.
Miscellaneous.
7.1
Within 10 Business Days after the Waiver Effective Date, each Borrower
shall have delivered such certificates of officers, incumbency certificates,
charter documents,
resolutions, good
standing certificates and other documents
related to the status of each Borrower and as to the proper
authorization of the
transactions
contemplated by this
Agreement,
as reasonably required by the
Agent, provided that
the Agent may extend the date by which this requirement is
required to be satisfied.
7.2
References in the Credit Agreement or in any other Loan Document to
the
Credit Agreement
shall be deemed to be
references to the
Credit Agreement
as
amended hereby and as further amended from time to time.
Without limiting the
definition of Loan
Documents,
this Agreement and all other agreements and
documents executed in connection herewith constitute Loan
Documents.
7.3
Except as expressly amended hereby, the Borrowers agree that the
Credit
Agreement and all
other Loan Documents
are ratified and
confirmed and shall
remain in full
force and effect and that it has no set
off, counterclaim,
defense or other claim
or dispute with
respect to any of the
foregoing.
The
Borrowers hereby
acknowledge
and affirm the
accuracy of all
recitals to this
Agreement. The
Borrowers represent that they have no intention to file or
acquiesce in the filing of any bankruptcy or insolvency proceeding
hereafter and
believe that the period of time allowed by this Agreement are
sufficient for the
Borrowers to accomplish the transactions it has undertaken as
represented to the
Banks. Terms used but
not defined herein
shall have the
respective
meanings
ascribed thereto in the Credit Agreement.
7.4
The Credit Agreement
and the other Loan Documents, as amended by this
Agreement, constitute
the entire
understanding of the
parties with respect to
the subject
matter hereof and may only be modified or amended by a writing
signed by the party to be charged. If any provision of this Agreement is in
conflict with any applicable statute or rule of law or otherwise
unenforceable,
such offending
provision shall be null and void
only to the
extent of such
conflict or
unenforceability, but
shall be deemed
separate from and shall not
invalidate any other provision of this Agreement.
7.5
This Amendment may be executed in any number of counterparts with the
same effect
as if the signatures thereto and hereto were upon the same
instrument. Facsimile
copies of signatures shall be treated as original
signatures for all purposes under this Agreement.
9
<page>
7.6
Each of the
Borrowers agrees to execute and deliver any and all
documents reasonably
deemed necessary or
appropriate by the Agent or the Banks
to carry out the intent of and/or to implement this Agreement.
7.7
This Amendment shall
not be construed more strictly against the Banks
or the Agent merely by virtue of the fact that the same has been
prepared by the
Banks and the Agent or their counsel, it being recognized that the Borrowers,
the Agent and the Banks have contributed substantially and materially to the
preparation of this
Agreement, and each of
the parties hereto waives any claim
contesting the existence and the adequacy of the consideration given by any of
the other parties hereto in entering into this Agreement.
[signature pages follow]
10
<page>
If
you are in agreement
with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and
return it to the
Agent.
INVACARE CORPORATION
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Chief Financial Officer
INVACARE (DEUTSCHLAND) GmbH
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
INVACARE AUSTRALIA PTY. LTD.
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
INVACARE CANADA INC.
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
INVACARE S.A.
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
INVACARE (UK) LIMITED
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
<page>
INVACARE INTERNATIONAL SARL
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
DOMUS HOMECARE AG
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
INVACARE HOLDINGS CV
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
SCANDINAVIAN MOBILITY INTERNATIONAL APS
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
2030604 ONTARIO INC.
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
CARROLL HEALTHCARE, INC.
By: /s/ Gregory C. Thompson
Name: Gregory C. Thompson
Title: Authorized Officer
<page>
Accepted and agreed to:
JPMORGAN CHASE BANK,
N.A.,
as a Lender and as Agent
By: /s/ Dane E. Jergens
Dane E. Jergens
Title: Vice President
KEYBANK NATIONAL ASSOCIATION,
as a Bank and Syndication Agent
By: /s/ J.T. Taylor
J.T. Taylor
Title: Senior Vice President
NATIONAL CITY BANK,
as a Bank and Documentation Agent
By: /s/ Robert S. Coleman
Robert S. Coleman
Title: Senior Vice President
BANK OF AMERICA, N.A.,
as a Bank and Documentation Agent
By: /s/ Kevin R. Wagley
Kevin R. Wagley
Title: Senior Vice President
CALYON NEW YORK BRANCH
By: /s/Doug Weir
Doug Weir
Title: Director
By: /s/Priya Vrat
Priya Vrat
Title: Vice President
<page>
HARRIS N.A.
By: /s/ Mark W. Piekos
Mark W. Piekos
Its: Managing Director
NORDEA BANK FINLAND PLC, NEW YORK BRANCH
By: /s/ Henrik M. Steffensen
Henrik M. Steffensen
Its: Senior Vice President
By: /s/ Gerald E. Chelius Jr.
Gerald E. Chelius Jr.
Its: Senior Vice President Credit
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Patrick D. Flaherty
Patrick D. Flaherty
Its: Credit Officer
SUNTRUST BANK
By: /s/ William Priester
William Priester
Its: Director
THE BANK OF NEW YORK
By: /s/ John M. Lokay Jr.
John M. Lokay Jr.
Its: Vice President
<page>
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A.
"RABOBANK INTERNATIONAL",
NEW YORK BRANCH
By: /s/ Rebecca O. Morrow
Rebecca O. Morrow
Its: Executive Director
<page>
SCHEDULE 3(e)
EXISTING DEBT
11/14/06
Senior Unsecured Notes
----------------------
6.71%, issued February 27, 1998, due February 27, 2008
$80,000,000.00
3.97%, issued October 1, 2003, due October 1, 2007
50,000,000.00
4.74%, issued October 1, 2003, due October 1, 2009
30,000,000.00
5.05%, issued October 1, 2003, due October 1, 2010
20,000,000.00
6.15%, issued April 27, 2006, due April 27, 2016
150,000,000.00
Revolving Credit Facility (USD Equivalent)
------------------------------------------
Carroll Healthcare
55,169,477.21
Invacare Australia
9,676,250.00
Invacare International Sarl
16,794,247.18
Invacare International Sarl
2,621,365.92
Invacare International Sarl
31,647,967.06
Invacare Corporation
25,000,000.00
Overdraft Line
--------------
Invacare Corporation
15,742,310.21
Other
-----
Letters of Credit
2,568,000.00
Property Leases
11,543,000.00
Total Consolidated Debt
$500,762,617.58
Maximum Allowed Debt
520,762,617.58
Additional Borrowing Capacity
$20,000,000.00
<page>
SCHEDULE 3(f)
Itemization
description of the
Consolidated Total
Debt of the Company and its
Subsidiaries (as defined in and as calculated under the Credit
Agreement) as of
November 14, 2006
Senior Unsecured Notes
----------------------
6.71%, issued February 27, 1998, due February 27, 2008
$80,000,000.00
3.97%, issued October 1, 2003, due October 1, 2007
50,000,000.00
4.74%, issued October 1, 2003, due October 1, 2009
30,000,000.00
5.05%, issued October 1, 2003, due October 1, 2010
20,000,000.00
6.15%, issued April 27, 2006, due April 27, 2016
150,000,000.00
Revolving Credit Facility (USD Equivalent)
------------------------------------------
Carroll Healthcare
55,169,477.21
Invacare Australia
9,676,250.00
Invacare International Sarl
16,794,247.18
Invacare International Sarl
2,621,365.92
Invacare International Sarl
31,647,967.06
Invacare Corporation
25,000,000.00
Overdraft Line
--------------
Invacare Corporation
15,742,310.21
Other
-----
Letters of Credit
2,568,000.00
Property Leases
11,543,000.00
Total Consolidated Debt
$500,762,617.58
Maximum Allowed Debt
520,762,617.58
Additional Borrowing Capacity
$20,000,000.00
<page>
SCHEDULE 3(g)
CERTAIN LITIGATION
<page>
EXHIBIT A
Securitization Waiver
OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMANCE
UNDERTAKING
THIS
OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMAN
