-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, G96Qtfb78+HUJPSEl21XrGPtvmfcQEZIYCMqD4Bj4IAlcMqwcYRNNMp1bPYaEZY+ NEO1BHqX/RimNVZ9xXZhIw== 0000742112-06-000040.txt : 20061219 0000742112-06-000040.hdr.sgml : 20061219 20061219162307 ACCESSION NUMBER: 0000742112-06-000040 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20061215 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Triggering Events That Accelerate or Increase a Direct Financial Obligation under an Off-Balance Sheet Arrangement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061219 DATE AS OF CHANGE: 20061219 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INVACARE CORP CENTRAL INDEX KEY: 0000742112 STANDARD INDUSTRIAL CLASSIFICATION: ORTHOPEDIC, PROSTHETIC & SURGICAL APPLIANCES & SUPPLIES [3842] IRS NUMBER: 952680965 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15103 FILM NUMBER: 061286788 BUSINESS ADDRESS: STREET 1: ONE INVACARE WAY STREET 2: P O BOX 4028 CITY: ELYRIA STATE: OH ZIP: 44036 BUSINESS PHONE: 4403296000 8-K 1 dec8k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) December 15, 2006 ------------------------------- Invacare Corporation (Exact name of registrant as specified in its charter) Ohio 0-12938 95-2680965 - -------------------------------------------------------------------------------- (State or other jurisdiction of (Commission (IRS Employer Identification) incorporation or organization) File Number No) One Invacare Way, P.O. Box 4028, Elyria, Ohio 44036 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (440) 329-6000 ------------------------------ ________________________________________________________________________________ (Former name, former address and former fiscal year, if change since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01 Entry into a Material Definitive Agreement. In Part II, Item 5 of its Form 10-Q for the quarter ended September 30, 2006, Invacare Corporation (the "Company") disclosed that it was in violation of a financial covenant contained in three Note Purchase Agreements between the Company and various institutional lenders and that the violation also may constitute a default under the Company's credit facility with various banks and its separate trade receivables securitization facility. As disclosed on a Form 8-K dated as of November 14, 2006, the Company obtained waivers of the covenant violation from each of its lenders, effective as of November 14, 2006, which were effective through December 15, 2006. Effective December 15, 2006, the Company obtained waivers of the covenant violation from each of its lenders, which are effective through February 15, 2007 so long as the Company executes a commitment letter for a new financing by December 22, 2006, or else the waivers extend only until January 31, 2007. The waivers limit the Company's maximum amount of debt through that date to $521 million. The Company does not believe that this limitation will impair its ability to continue to operate its business in the ordinary course. The Company has been meeting with representatives of its existing lenders and other prospective lenders in order to arrange for the refinancing of its long term debt. While Invacare believes that it will be able to secure new financing on acceptable terms, there can be no assurance of this. Failure to obtain new financing on or before February 15, 2007 or, in the alternative, to extend the termination date of the existing waivers would have a material adverse effect on the Company's liquidity and/or its financial position. Copies of each of the waivers referenced in the foregoing paragraph are filed herewith as Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 to this Form 8-K and are incorporated by reference into this Item 1.01. Item 2.04 Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement. The Information set forth in Item 1.01 of this Form 8-K is incorporated into this Item 2.04 by reference. Item 9.01 Financial Statements and Exhibits. (c) Exhibits Exhibit 10.1 Second Waiver and Amendment dated as of December 15, 2006 to Note Purchase Agreement dated as of February 27, 1998 for $80,000,000 6.71% Series A Senior Notes Due February 27, 2008 and $20,000,000 6.60% Series B Senior Notes Due February 27, 2005; Exhibit 10.2 Second Waiver and Amendment dated as of December 15, 2006 to Note Purchase Agreement dated as of October 1, 2003 for $50,000,000 3.97% Series A Senior Notes Due October 1, 2007; $30,000,000 4.74% Series B Senior Notes Due October 1, 2009 and $20,000,000 5.05% Series C Senior Notes Due October 1, 2010; Exhibit 10.3 Second Waiver and Amendment Agreement dated as of December 15, 2006 to Credit Agreement dated as of January 14, 2005 among Invacare Corporation and Certain Borrowing Subsidiaries, the Banks named therein, and JPMorgan Chase Bank, N.A. as Agent, Keybank National Association as Syndication Agent, J.P. Morgan Securities, Inc. and Keybank National Association, as Co-Lead Arrangers; Exhibit 10.4 Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking dated as of December 15, 2006 to Receivables Purchase Agreement, dated as of September 30, 2005, among Invacare Receivables Corporation, as Seller, Invacare Corporation, as Servicer, Park Avenue Receivables company, LLC and JPMorgan Chase Bank, N.A., as Agent; and Exhibit 10.5 Second Waiver and Amendment dated as of December 15, 2006 to Note Purchase Agreement, dated as of April 27, 2006, by and among Invacare Corporation and the various purchasers named therein, relating to $150,000,000 in 6.15% Senior Notes Due April 27, 2016 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. INVACARE CORPORATION By:/s/ Gregory C. Thompson ----------------------------------------- Gregory C. Thompson Chief Financial Officer Date: December 19, 2006 EX-10 2 exhibit1.txt 10.1 Exhibit 10.1 ================================================================================ INVACARE CORPORATION ----------------------------------- SECOND WAIVER AND AMENDMENT Dated as of December 15, 2006 to NOTE PURCHASE AGREEMENTS Dated as of February 27, 1998 ----------------------------------- Re: $80,000,000 6.71% Series A Senior Notes due February 27, 2008 ================================================================================ SECOND WAIVER AND AMENDMENT TO NOTE PURCHASE AGREEMENTS THIS SECOND WAIVER AND AMENDMENT, dated as of December 15, 2006 (this "Waiver and Amendment") to the separate and several Note Purchase Agreements dated as of February 27, 1998, is between INVACARE CORPORATION, an Ohio corporation (the "Company"), and each of the institutions which is a signatory to this Waiver and is a Noteholder referred to below. RECITALS: A. The Company has previously entered into separate and several Note Purchase Agreements, each dated as of February 27, 1998, between the Company and each of the institutions identified on Schedule A thereto (together with their successors and assigns, each a "Noteholder," and, collectively, the "Noteholders"), as amended by that certain First Amendment, dated as of October 1, 2003, to Note Purchase Agreements dated as of February 27, 1998, that certain Second Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of February 27, 1998, and that certain Waiver and Amendment, dated as of November 14, 2006 (as amended, restated or otherwise modified, the "Existing NPA Waiver"), to Note Purchase Agreements dated as of February 27, 1998 (as amended, restated or otherwise modified from time to time, collectively, the "Note Purchase Agreement"), pursuant to which the Company issued and sold its (i) $80,000,000 6.71% Series A Senior Notes due February 27, 2008 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "Notes") and (ii) $20,000,000 6.60% Series B Senior Notes due February 27, 2005 (which Series B Notes have since been paid in full by the Company). The Noteholders are the holders of all of the outstanding principal amount of the Notes. B. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of October 1, 2003, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreement dated as of October 1, 2003, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of October 1, 2003 (as amended, restated or otherwise modified from time to time, the "Existing 2003 NPA Waiver"), and that certain Second Waiver and Amendment, dated as of the date hereof, to Note Purchase Agreements dated as of October 1, 2003 (as amended, restated or otherwise modified from time to time, the "New 2003 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "2003 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $50,000,000 3.97% Series A Senior Notes due October 1, 2007, (ii) $30,000,000 4.74% Series B Senior Notes due October 1, 2009, and (iii) $20,000,000 5.05% Series C Senior Notes due October 1, 2010 (all of such notes, as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "2003 Notes"). C. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of April 27, 2006, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of April 27, 2006 (as amended, restated or otherwise modified from time to time, the "Existing 2006 NPA Waiver") and that certain Second Waiver and Amendment dated as of the date hereof to Note Purchase Agreements dated as of April 27, 2006 (as amended, restated or otherwise modified from time to time, the "New 2006 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "2006 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its $150,000,000 6.15% Senior Notes due April 27, 2016 (all of such notes, as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "2006 Notes"). D. The Company has also previously entered into that certain Credit Agreement dated as of January 14, 2005, among the Company, the Borrowing Subsidiaries (as defined therein), JPMorgan Chase Bank, N.A., as agent (the "Agent"), and the other bank lenders party thereto (the "Banks"), as amended by that certain Letter Agreement, dated as of March 31, 2005, that certain First Amendment to Credit Agreement, dated as of August 12, 2005, that certain Second Amendment to Credit Agreement, dated as of March 31, 2006, that certain Waiver and Amendment Agreement, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Bank Waiver"), and that certain Second Waiver and Amendment Agreement (as amended, restated or otherwise modified from time to time, the "New Bank Waiver"), dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "Bank Credit Agreement"). E. The Company is also a party to (i) that certain Receivables Purchase Agreement, dated as of September 30, 2005, among the Company, as Servicer, Invacare Receivables Corporation, as Seller, Park Avenue Receivables Company, LLC and JPMorgan Chase Bank, N.A., as Agent, and the purchasers named on Schedule A thereto (the "Securitization Lenders") as amended by that certain Amendment No. 1 to Receivables Purchase Agreement, dated as of September 28, 2006 and that certain Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Securitization Waiver"), and that certain Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New Securitization Waiver", and together with the New 2003 NPA Waiver, the New 2006 NPA Waiver and the New Bank Waiver, the "Other December 2006 Waivers") (such Receivables Purchase Agreement, as amended, restated or otherwise modified from time to time, the "Securitization Purchase Agreement"), (ii) that certain Receivables Sale Agreement, dated as of September 30, 2005, among the Company, Invacare Receivables Corporation, Healthtech Products, Inc. and Invacare Supply Group, Inc. as amended by the Existing Securitization Waiver and the New Securitization Waiver (as amended, restated or otherwise modified from time to time, the "Securitization Sale Agreement") and (iii) that certain Performance Undertaking, dated as of September 30, 2005, in favor of Invacare Receivables Corporation (as amended, restated or otherwise modified from time to time, the "Performance Undertaking", and together with the Securitization Sale Agreement and the Securitization Purchase Agreement, the "Securitization Documents", and the Securitization Documents, together with the 2003 Note Purchase Agreement, the 2006 Note Purchase Agreement and the Bank Credit Agreement, collectively, the "Other Primary Loan Agreements", and the 2 Other Primary Loan Agreements, together with the Note Purchase Agreement, collectively, the "Primary Loan Agreements" and the Primary Loan Agreements, together with the other agreements, documents and instruments entered into in connection therewith or pursuant thereto, collectively, the "Primary Loan Documents"). F. Pursuant to (i) the Existing NPA Waiver, the Noteholders have agreed to waive, through December 15, 2006 (subject to the terms and conditions thereof) certain Defaults and Events of Default that otherwise would exist and be continuing under the Note Purchase Agreements and which are set forth on Schedule A attached hereto (collectively, the "Existing Defaults"), (ii) the Existing 2003 NPA Waiver, the holders of the 2003 Notes (the "2003 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2003 Note Purchase Agreement, (iii) the Existing 2006 NPA Waiver, the holders of the 2006 Notes (the "2006 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2006 Note Purchase Agreement, (iv) the Existing Bank Waiver, the Banks have agreed to waive, through December 15, 2006, certain defaults and events of default under the Bank Credit Agreement and (v) the Existing Securitization Waiver, the Securitization Lenders have agreed to waive, through December 15, 2006, certain "Termination Events" and "Potential Termination Events" under (and as defined in) the Securitization Sale Agreement and certain "Amortization Events" and "Potential Amortization Events" under (and as defined in) the Securitization Purchase Agreement (all of such events, the "Existing Securitization Defaults" and together with any other such events from time to time existing under such documents, the "Securitization Defaults"). G. The Company has requested that the Noteholders agree to extend the waivers of the Existing Defaults under the Note Purchase Agreement, and the Noteholders are agreeable to such request, solely on the terms and conditions set forth herein, including, without limitation, the amendments described in Section 2 hereof. H. The Company has likewise requested that (i) the 2003 Noteholders agree to extend the waivers of the defaults and events of default under the 2003 Note Purchase Agreement pursuant to the terms of the New 2003 NPA Waiver, (ii) the 2006 Noteholders agree to extend the waivers of the defaults and events of default under the 2006 Note Purchase Agreement pursuant to the terms of the New 2006 NPA Waiver, (iii) the Banks agree to extend the waivers of the defaults and events of default under the Bank Credit Agreement (and waive any new defaults or events of default thereunder) pursuant to the terms of the New Bank Waiver and (iv) the Securitization Lenders agree to extend the waivers of the Existing Securitization Defaults under the Securitization Documents pursuant to the terms of the New Securitization Waiver. I. All requirements of law have been fully complied with and all other acts and things necessary to make this Waiver and Amendment a valid, legal, and binding instrument according to its terms for the purposes herein expressed have been done or performed. NOW, THEREFORE, upon the full and complete satisfaction of the conditions precedent to the effectiveness of this Waiver and Amendment set forth in Section 3 4 hereof, and in consideration of good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the Company and the undersigned Noteholders do hereby agree as follows: SECTION 1. TEMPORARY WAIVER. (a) The Company acknowledges and agrees that, as a result of the Existing Defaults under the Note Purchase Agreement, the Noteholders may, on or after December 15, 2006, if they so elect, proceed to enforce their respective rights and remedies under the Note Purchase Agreement to collect the Company's obligations thereunder. (b) Subject to the terms and conditions of this Waiver and Amendment, the Noteholders hereby agree to temporarily waive (collectively, the "Waivers") the Existing Defaults during the period (the "Waiver Period") commencing on the Effective Date and expiring on the earliest to occur of (i) January 31, 2007, unless such date has been automatically extended to February 15, 2007 as provided in Section 1(c) below (the "Outside Waiver Termination Date"), (ii) any Default or Event of Default under the Note Purchase Agreement (including, without limitation, any Default or Event of Default arising out of a failure to comply with any term, covenant or condition of the Existing NPA Waiver, including Section 5 thereof as amended hereby), (iii) the breach or nonperformance by the Company or any Subsidiary of any covenant, agreement or condition set forth in this Waiver and Amendment or the Other December 2006 Waivers, (iv) any breach of, default, event of default or Securitization Default under any Other Primary Loan Agreement (or any amendment or waiver with respect thereto) or any termination or other expiration of the waiver period set forth in the Other December 2006 Waivers, and (v) the date on which any representation or warranty in Section 3 hereof fails to be true and correct. (c) The Outside Waiver Termination Date shall be automatically extended from January 31, 2007 to February 15, 2007, without notice or any other action, if (i) on or prior to December 22, 2006, the Company has provided each of the Noteholders with a fully executed commitment letter or letters (as amended or otherwise modified from time to time, collectively, the "Commitment Letters") providing fully underwritten commitments from one or more reputable financial institutions and/or institutional investors to provide financing to the Company in an aggregate amount sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007, in form and substance satisfactory to the Required Holders and (ii) the waiver period under each of the Other December 2006 Waivers has likewise been (or shall be, concurrently with the extension of the Waiver Period) extended to February 15, 2007 on terms and conditions satisfactory to the Required Holders; provided, however if on or prior to January 31, 2007, (x) any of the Commitment Letters is terminated (unless the commitments under the remaining Commitment Letters, after giving effect to such termination and any new Commitment Letter or Commitment Letters entered into by the Company in replacement of such terminated Commitment Letter and delivered to each of the Noteholders prior to such termination, are sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007) or (y) the waiver period under any of the Other December 2006 Waivers shall have reverted to January 31, 2007 then, in any such case, the Outside Waiver Termination Date shall revert to January 31, 2007; provided, further that if any of the events described in the 4 foregoing clauses (x) or (y) occurs after January 31, 2007, the Waiver Period shall expire as of the occurrence of such event without notice or any further action. (d) The waiver contemplated in this Section 1 shall be effective only for the Existing Defaults and only for the Waiver Period, and such waiver shall not entitle the Company 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 Noteholders. Such waiver shall not prejudice or constitute a waiver of any right or remedies which any Noteholder may have or be entitled to with respect to any other breach of any provision of any of the Note Purchase Agreement or the Notes. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement and Notes 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, an Event of Default will continue to exist under the Note Purchase Agreement, and the Noteholders may, 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 Note Purchase Agreement), accelerate the payment in full of the obligations owed to the Noteholders under the Note Purchase Agreement and Notes, and enforce and exercise any or all of the Noteholders' rights under or in respect of the Note Purchase Agreement and the Notes and under applicable law. (e) For avoidance of doubt, it is hereby acknowledged and agreed to by the Company that the addition of the agreements and covenants in Section 5 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 Noteholders, and the Noteholders shall retain all their rights and remedies under or in respect of the Note Purchase Agreement and Notes and under applicable law with respect to the Existing Defaults upon the expiration or termination of the Waiver Period. SECTION 2. AMENDMENTS. Section 2.1. Amendment and Restatement of the Notes. (a) Amendment and Restatement. Each Note is hereby, without any further action required on the part of any Person, deemed to be automatically amended to conform to and have the terms provided in Exhibit 2.1(a) to this Agreement (except that the principal amount and the payee of each such Note shall remain unchanged). Any Note issued on or after the Effective Date shall be in the form of Exhibit 2.1(a) to this Waiver and Amendment. (b) Replacement Notes. Upon the request of any Noteholder, the Company will issue a replacement Note or Notes (consistent with the terms hereof) in favor of such Noteholder in the appropriate form in exchange for the Note or Notes of such Noteholder delivered to the Company at the time of such exchange. Section 2.2. Amendments of Existing NPA Waiver. 5 (a) Section 5 of the Existing NPA Waiver is hereby amended by deleting the phrase "and continuing through April 15, 2007" in the third and fourth lines thereof. (b) Section 5(b) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(b) the Company will not, and will not permit any of its Subsidiaries to, at any time, directly or indirectly (i) create, incur, assume, guarantee, or otherwise become liable in respect of (A) any Debt of the Company other than Debt incurred under the Credit Agreement, (B) any Debt of Subsidiaries other than Debt incurred under the Credit Agreement by Subsidiaries that are party to the Credit Agreement as of December 15, 2006 and (C) any Securitization except that one or more Special Purpose Subsidiaries that are party to the Securitization Documents as of December 15, 2006 may become liable in respect of a Permitted Receivables Securitization Program not exceeding $75,401,750 (not including obligations in respect of fees, expenses, indemnities and other reimbursement obligations permitted under such Permitted Receivables Securitization Program) in the aggregate at any time and (ii) create, incur, assume or suffer to exist, any Lien securing any Debt of the Company or any Subsidiary or any Lien created, incurred, assumed or otherwise existing with respect to any Securitization, except Liens incurred on receivables, related assets and collections of the Company or any Subsidiary in connection with such assets being transferred to a Special Purpose Subsidiary pursuant to a Permitted Receivables Securitization Program as permitted in accordance with Section 5(f) of this Waiver; as used in this Section 5(b), "Securitization" means one or more transactions wherein the Company and/or a Subsidiary transfers receivables, related assets and collections of the Company and/or such Subsidiary to a special purpose Subsidiary which issues or incurs indebtedness secured by such receivables and all of its other assets;" (c) Section 5(i) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(i) the Company will not, and will not permit any Subsidiary to, (x) enter into any agreement restricting the ability of the Company and its Subsidiaries to amend or modify the Note Purchase Agreement or Notes or any document or instrument executed in connection therewith, except as set forth in the waiver/amendment to the Bank Credit Agreement referred to in Section 3(c) hereof or (y) enter into any agreement or arrangement requiring any defeasance of the Bank Credit Agreement; and" SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. To induce the Noteholders to execute and deliver this Waiver and Amendment (which representations shall survive the execution and delivery of this Waiver and Amendment), the Company represents and warrants to the Noteholders that: 6 (a) this Waiver and Amendment has been duly authorized, executed and delivered by it and this Waiver and Amendment constitutes the legal, valid and binding obligation, contract and agreement of the Company enforceable against it 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 Note Purchase Agreement, as modified by this Waiver and Amendment, constitutes the legal, valid, and binding obligations, contracts, and agreements of the Company 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, delivery and performance by the Company of this Waiver and Amendment (i) has been duly authorized by all requisite corporate action and, if required, shareholder action, (ii) does not require the consent or approval of any governmental or regulatory body or agency, and (iii) does not and will not (A) violate (1) any provision of law, statute, rule or regulation or its certificate of incorporation or bylaws, (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 referred to in clause (iii)(A)(3) of this Section 3(c) or (C) result in the creation of any Lien; (d) as of the date hereof and after giving effect to this Waiver and Amendment and the Other December 2006 Waivers, (i) no Default or Event of Default has occurred which is continuing under the Note Purchase Agreement, (ii) no default, event of default, Securitization Default or similar event has occurred and is continuing under any Other Primary Loan Agreement; and (e) all the representations and warranties made by the Company in the Note Purchase Agreement 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; (f) neither the Company nor any of its Affiliates has paid or agreed to pay any fees or other consideration, or given any additional security or collateral, or shortened the maturity or average life of any indebtedness or permanently reduced any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company, in connection with the obtaining of any consents or approvals in connection with the transactions contemplated hereby (including, without limitation, under the Other Primary Loan Agreements), other than (i) with respect to the Notes, the payment of the waiver fees referred to in Section 4(b)(i) below and the additional fee payable in accordance with Section 5.2 below, (ii) with respect to the 2003 Notes, a waiver fee equal to 0.10% of the 7 aggregate outstanding principal amount of the 2003 Notes paid pro rata to the 2003 Noteholders, (iii) with respect to the 2006 Notes, a waiver fee equal to 0.10% of the aggregate outstanding principal amount of the 2006 Notes paid pro rata to the 2006 Noteholders, (iv) with respect to the Bank Credit Agreement, a waiver fee equal to 0.10% of the aggregate commitments of the Banks, (v) the waiver fee payable to the Securitization Lenders under Section 4 of the New Securitization Waiver and (vi) with respect to the 2003 Notes, the 2006 Notes and the Bank Credit Agreement, a fee payable to the Banks, the 2003 Noteholders and the 2006 Noteholders, respectively, on substantially identical terms to those set forth in Section 5.2 below with respect to the fee payable to the holders of Notes under such Section; (g) the amount of Consolidated Debt of the Company and its Subsidiaries (as defined in and as calculated under the Note Purchase Agreement) as of December 15, 2006, is $500,762,618, as described in further detail on Schedule B hereto; (h) the amount of all Revolving Credit Advances (as defined in the Bank Credit Agreement) outstanding under the Bank Credit Agreement as of December 15, 2006 is $157,893,617, consisting of $117,254,840 in Revolving Credit Advances made to Subsidiaries and $40,638,778 in Revolving Credit Advances made to the Company; and as of December 15, 2006, there are no Bid-Option Loans (as defined in the Bank Credit Agreement) outstanding; (i) on December 15, 2006, the Company and its Subsidiaries have the right to obtain Advances (as defined in the Credit Agreement) of $20,000,000 under the Credit Agreement; (j) except as set forth and described in the Recitals hereto, the Company has not entered into any amendment or waiver or entered into any agreement having the effect of an amendment or waiver with respect to any provision of any of the Primary Loan Documents; and (k) 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. SECTION 4. CONDITIONS TO EFFECTIVENESS; POST-CLOSING COVENANTS. (a) The Waivers shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied (the "Effective Date"): (i) executed counterparts of this Waiver and Amendment, duly executed by the Company and the Required Holders, shall have been delivered to the Noteholders; (ii) the representations and warranties of the Company set forth in Section 3 hereof are true and correct on and with respect to the date hereof and (except to the extent that any of such representations and warranties expressly relate by their terms to a prior date) the Effective Date; 8 (iii) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Bank Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing Bank Waiver, together with any other defaults or events of default that have occurred and are continuing, for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder), and on the Effective Date, after giving effect to the New Bank Waiver, (i) the Company and its Subsidiaries have the right to obtain Advances of not less than $20,000,000 under the Credit Agreement and (ii) the "Termination Date" under the Credit Agreement shall not be on a date prior to January 14, 2010; (iv) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 2003 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 2003 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (v) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 2006 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 2006 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vi) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Securitization Waiver which shall provide for an amendment, modification, waiver, or consent necessary to waive the Existing Securitization Defaults for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vii) the Company shall have acknowledged and agreed to an engagement agreement between Bingham McCutchen LLP (on behalf of the Noteholders) and FTI Consulting, Inc. (as amended, restated or otherwise modified from time to time, the "Financial Advisor Engagement Agreement") satisfactory in form and substance to the Noteholders and their special counsel; 9 (viii) the Company shall have acknowledged and agreed to an engagement agreement among the Noteholders and Bingham McCutchen LLP (as amended, restated or otherwise modified from time to time, the "Bingham Engagement Agreement", and together with the Financial Advisor Engagement Agreement, the "Engagement Agreements") satisfactory in form and substance to the Noteholders and their special counsel; (ix) the Noteholders shall have received a copy of the resolutions of the Board of Directors of the Company authorizing the execution, delivery, and performance by the Company of this Waiver and Amendment, certified by its Secretary or an Assistant Secretary, together with documentation evidencing all other proceedings taken in connection with the transactions contemplated by this Waiver and Amendment, and all documents necessary to the consummation thereof, in each case, which shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel; (x) the Noteholders shall have received such lien searches with respect to the Company as are reasonably required by the Noteholders or their special counsel; and (xi) a statement of the Company's and its Subsidiaries' cash balances as of the close of business on Friday, December 15, 2006, certified as true and correct by a Senior Financial Officer. (b) The Company shall, on or prior to December 18, 2006: (i) pay to each Noteholder, by wire transfer of immediately availably funds, a waiver fee, whether or not such holder has signed this Waiver and Amendment, in an amount equal to 0.10% of the aggregate outstanding principal amount of the Notes held by such Noteholder; such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is terminated or rescinded for any reason; (ii) pay the reasonable fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP, and the Noteholder's financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby, and any fees and expenses of Chapman and Cutler LLP in connection with the negotiation, preparation, execution and delivery of the Existing NPA Waivers that have not yet been paid; the payment of the fees and disbursements pursuant to this Section 4(b)(ii) does not preclude the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 6 of this Waiver and Amendment or Section 16 of the Note Purchase Agreement; and (iii) pay the fee reserves payable to the Bingham McCutchen LLP and FTI Consulting, Inc. under the terms of their respective Engagement Letters. 10 The failure of the Company to comply with any of the covenants set forth in this Section 4(b) shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 5. COVENANTS. In addition to and without limiting the Company's obligations under the Note Purchase Agreement, the Company covenants and agrees that at all times from and after the date hereof: Section 5.1. Compliance with Financial Advisor Engagement Agreement. The Company shall comply with each of the terms and conditions of the Financial Advisor Engagement Agreement. Section 5.2. Fee Upon Failure to Deliver (or Termination of) Commitment Letters. If either (i) the condition set forth in Section 1(c)(i) of this Waiver and Amendment is not met or (ii) the event set forth in clause (x) of the first proviso to Section 1(c)(i) of this Waiver and Amendment occurs, the Company shall pay, and there shall become due and payable, on the next Business Day following the first to occur of the events set forth in the foregoing clause (i) or clause (ii), a fee to each Noteholder in an amount equal to 0.15% of the aggregate outstanding principal amount of the Notes then held by such Noteholder (which fee shall be paid by wire transfer of immediately available funds); such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is thereafter terminated or rescinded for any reason. Section 5.3. Payment of Additional Fees or Compensation to Creditors. The Company will not, and will not permit any of its Subsidiaries or Affiliates to, pay or agree to pay any fees or other consideration, or give any additional security or collateral, or shorten the maturity or average life of any indebtedness or permanently reduce any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company (or any agent of any creditor or group of creditors) without the prior written consent of the Required Holders (other than a fee payable to the Banks, the 2003 Noteholders and the 2006 Noteholders on substantially identical terms to those set forth in Section 5.2 above with respect to the fee payable to the Noteholders under such Section). Section 5.4. Amendments to Primary Loan Documents. The Company will not permit any Primary Loan Document or any amendment or waiver of any Primary Loan Document (in each case, other than the Note Purchase Agreement and the Notes), to be amended, waived or otherwise modified after the date hereof without the prior written consent of the Required Holders. Section 5.5. Closing of New Credit Facilities; Prepayment. The Company covenants and agrees that it shall close the credit facilities which are the subject of the Commitment Letters on or before February 15, 2007 and it shall make a drawing under such credit facilities on or before February 15, 2007 for the purpose of prepaying all amounts owing under the Note Purchase Agreement. Any such prepayment shall be deemed to be an optional prepayment of the Company's obligations under the Note Purchase Agreement and the Notes in 11 accordance with Section 8.2 of the Note Purchase Agreement, and the Noteholders waive the requirement of prior written notice of prepayment thereunder in connection with such prepayment. The failure of the Company to comply with any of the covenants set forth in this Section 5 shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 6. FEES AND EXPENSES. The Company shall pay the fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP and the Noteholders' financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby in accordance with the terms of the Engagement Letters. This provision shall be supplementary to, and shall not in any way be deemed to limit, the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 16 of the Note Purchase Agreement. SECTION 7. RELEASE. In order to induce the Noteholders to enter into this Waiver and Amendment, the Company acknowledges and agrees that: (a) neither the Company nor any of its Subsidiaries has any claim or cause of action against any of the Noteholders or any of their respective directors, trustees, officers, employees or agents (collectively, the "Released Parties") relating to or arising out of the Note Purchase Agreement or Notes or any of the transactions related thereto; (b) neither the Company nor any of its 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; and (c) each of the Released Parties has heretofore properly performed and satisfied in a timely manner all of its obligations to the Company and its Subsidiaries under the Note Purchase Agreement. Notwithstanding this representation and as further consideration for the agreements and understandings herein, the Company, on behalf of itself and its employees, agents, executors, heirs, successors and assigns (the "Releasing Parties"), hereby releases the Noteholders, its respective predecessors, officers, directors, trustees, 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 Note Purchase Agreement or Notes or any of the transactions relating thereto. No Released Party shall be liable with respect to, and the Company hereby waives, releases and agrees not to sue for, any special, indirect or consequential damages relating to the Note Purchase Agreement and the Notes or arising out of its activities in connection herewith or therewith (whether before, on or after the date hereof). 12 SECTION 8. AMENDMENTS AND WAIVERS. This Waiver and Amendment may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders. SECTION 9. DEFINITIONS. Capitalized terms used herein shall have the respective meanings ascribed thereto in the Note Purchase Agreement, unless defined herein (in which case such terms shall have the meanings set forth herein) or the context shall otherwise require. SECTION 10. MISCELLANEOUS. Section 10.1. More Favorable Provisions. The Company acknowledges and agrees that any covenants, defaults or similar provisions set forth in any of the Other December 2006 Waivers not substantially provided for in this Waiver and Amendment, or any such covenants, defaults or similar provisions that are more favorable to the creditors thereunder than the covenants, defaults or similar provisions hereunder, are hereby incorporated by reference into this Waiver and Amendment 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. Section 10.2. Construction; References to Note Purchase Agreement. This Waiver and Amendment shall be construed in connection with and as part of the Note Purchase Agreement. Any and all notices, requests, certificates and other instruments executed and delivered after the execution and delivery of this Waiver and Amendment may refer to the Note Purchase Agreement without making specific reference to this Waiver and Amendment but nevertheless all such references shall include this Waiver and Amendment unless the context otherwise requires. This Waiver and Amendment shall not be construed more strictly against the Noteholders merely by virtue of the fact that the same has been prepared by the Noteholders or their counsel, it being recognized that the Company and the Noteholders have contributed substantially and materially to the preparation of this Waiver and Amendment, 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 Waiver and Amendment. Section 10.3. Ramifications of Waiver; Reaffirmation. The Company acknowledges that the waivers and amendments granted hereunder by the Noteholders shall not be construed as an agreement to amend or waive any other provision of any of the Note Purchase Agreement, and the Noteholders shall have no obligation to enter into any such amendment or waiver. Other than the Existing Defaults temporarily waived during the Waiver Period, none of the Noteholders have waived, nor are they by this Waiver and Amendment waiving, and have made no commitment to waive, any other Default or Event of Default that may occur or be continuing on the date hereof or may occur or be continuing after the date hereof. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement as a result of any other such Default or Event of Default. No 13 delay or omission of the Noteholders to exercise any right under the Note Purchase Agreement shall impair any such right or be construed to be a waiver of any other such Default or Event of Default or an acquiescence therein. Except as modified, waived or expressly amended by this Waiver and Amendment, all terms, conditions, and covenants contained in the Note Purchase Agreement are hereby ratified and confirmed by the Company and shall be and remain in full force and effect. Section 10.4. Affirmation of Recitals; etc. The Company hereby acknowledges and affirms the accuracy of all recitals to this Waiver and Amendment. The Company represents that neither it, nor any of its Subsidiaries, has any intention to file or acquiesce in the filing of any bankruptcy or insolvency proceeding hereafter and that the Company believes that the period of time allowed by this Waiver and Amendment is sufficient for the Company and its Subsidiaries to accomplish the transactions that they have undertaken as represented by the Company to the Noteholders. Section 10.5. Further Assurances. The Company will, and will cause each of its Subsidiaries to, execute and deliver any and all documents reasonably deemed necessary or appropriate by the Noteholders to carry out the intent of and/or to implement this Waiver and Amendment. Section 10.6. Section Headings. The descriptive headings of the various Sections or parts of this Waiver and Amendment are for convenience only and shall not affect the meaning or construction of any of the provisions hereof. Section 10.7. Governing Law. This Waiver and Amendment shall be governed by and construed and enforced in accordance with the law of the State of New York, excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. Section 10.8. Survival. The provisions of Sections 6 and 7 of this Waiver and Amendment shall survive and continue in effect following any termination, rescission or expiration of this Waiver and Amendment. Section 10.9. Time is of the Essence. TIME IS OF THE ESSENCE WITH RESPECT TO ALL COVENANTS, CONDITIONS, AGREEMENTS, OR OTHER PROVISIONS HEREIN. Section 10.10. Counterparts. This Waiver and Amendment may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this Waiver and Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Waiver and Amendment. [Remainder of page left intentionally blank] 14 If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Waiver and Amendment and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company. INVACARE CORPORATION By: /s/ Gregory C. Thompson Name: Gregory C. Thompson Title: Chief Financial Officer 13 The foregoing is hereby agreed to as of the date thereof: AMERICAN UNITED LIFE INSURANCE COMPANY By /s/ Michael I. Bullock Its V.P. Private Placements J. ROMEO & CO. (as nominee for MONY Life Insurance Company) By J. ROMEO & CO. (as nominee for MONY Life Insurance Company) By /s/ Peter Coccia Its Partner HARE & CO. (as nominee for MONY Life Insurance Company) By /s/ Monica M. Heyl Its Authorized IM Representative The foregoing is hereby agreed to as of the date thereof: THE BALTIMORE LIFE INSURANCE COMPANY By AllianceBernstein LP its Investment Advisor By /s/ Matthew Minnetian Name Matthew Minnetian Title: Senior Vice President THE OHIO CASUALTY INSURANCE COMPANY By /s/ Paul Gerard Its Senior Vice President, Investments NATIONWIDE LIFE INSURANCE COMPANY By /s/ Joseph P. Young Joseph P. Young Its Authorized Signatory TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA By: /s/ Roi G. Chandy Name: Roi G. Chandy Title: Director The foregoing is hereby agreed to as of the date thereof: TIAA-CREF LIFE INSURANCE COMPANY By: Teachers Insurance and Annuity Association of America, as Investment Manager By: /s/ Roi G. Chandy Name: Roi G. Chandy Title: Director PRINCIPAL LIFE INSURANCE COMPANY By: Principal Global Investors, LLC a Delaware limited liability company, its authorized signatory By /s/ Debra Svoboda EPP EPP Counsel By /s/ James C. Fifield Counsel Schedule A Existing Defaults Events of Default under Section 12.1(c) of the Note Purchase Agreement by virtue of (a) the continuing failure of the Company to comply with Section 11.3 (the Consolidated Debt covenant which is tested at all times) and (b) the failure of the Company to give the written notice of its failure to comply with Section 11.3, as required by Section 7.1(d). Events of Default under Section 12(f) of the Note Purchase Agreement (by operation of Section 5(j) of the Existing NPA Waiver) due to the existence of the defaults, events of default and Securitization Defaults described in the Other December 2006 Waivers. Schedule B Description of Consolidated Debt [to be provided by the Company] EXHIBIT 2.1(a) THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. [FORM OF SERIES A SENIOR NOTE] INVACARE CORPORATION 6.71% SERIES A SENIOR NOTE DUE FEBRUARY 27, 2008 No. RA -__ PPN: 461203 A*2 $__________ [Date] FOR VALUE RECEIVED, the undersigned, INVACARE CORPORATION, an Ohio corporation (herein called the "Company"), hereby promises to pay to _______________ or registered assigns, the principal sum of _________________________________ DOLLARS ($__________) on February 27, 2008, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at a rate equal to 6.71% per annum from the date hereof, payable semiannually on February 27 and August 27 in each year, commencing with the February 27 or August 27 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment of interest, and, during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements (defined below)), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the Default Rate (as defined in the Note Purchase Agreements). Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at Elyria, Ohio or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of the 6.71% Series A Senior Notes due February 27, 2008 (herein called the "Notes") issued pursuant to separate Note Purchase Agreements, each dated as of February 27, 1998, as amended by that certain First Amendment, dated as of October 1, 2003, to Note Purchase Agreements dated as of February 27, 1998, that certain Second Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of February 27, 1998, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of February 27, 1998, and that certain Second Waiver and Amendment, dated as of December 15, 2006, to Note Purchase Agreements dated as of February 27, 1998 (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, collectively, the "Note Purchase Agreements"), among the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 21 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer, duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. This Note is subject to certain prepayments in the events, on the terms and in the manner and amounts as provided in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. INVACARE CORPORATION By: Name: ___________________________________ Title: EX-10 3 exhibit2.txt 10.2 Exhibit 10.2 ================================================================================ INVACARE CORPORATION ----------------------------------- SECOND WAIVER AND AMENDMENT Dated as of December 15, 2006 to NOTE PURCHASE AGREEMENTS Dated as of October 1, 2003 ----------------------------------- Re: $50,000,000 3.97% Series A Senior Notes due October 1, 2007 $30,000,000 4.74% Series B Senior Notes due October 1, 2009 $20,000,000 5.05% Series C Senior Notes due October 1, 2010 ================================================================================ SECOND WAIVER AND AMENDMENT TO NOTE PURCHASE AGREEMENTS THIS SECOND WAIVER AND AMENDMENT, dated as of December 15, 2006 (this "Waiver and Amendment") to the separate and several Note Purchase Agreements dated as of October 1, 2003, is between INVACARE CORPORATION, an Ohio corporation (the "Company"), and each of the institutions which is a signatory to this Waiver and is a Noteholder referred to below. RECITALS: A. The Company has previously entered into separate and several Note Purchase Agreements, each dated as of October 1, 2003, between the Company and each of the institutions identified on Schedule A thereto (together with their successors and assigns, each a "Noteholder," and, collectively, the "Noteholders"), as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of October 1, 2003, and that certain Waiver and Amendment, dated as of November 14, 2006 (as amended, restated or otherwise modified, the "Existing NPA Waiver"), to Note Purchase Agreements dated as of October 1, 2003 (as amended, restated or otherwise modified from time to time, collectively, the "Note Purchase Agreement"), pursuant to which the Company issued and sold its (i) $50,000,000 3.97% Series A Senior Notes due October 1, 2007 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "Series A Notes"), (ii) $30,000,000 4.74% Series B Senior Notes due October 1, 2009 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "Series B Notes"), and (iii) $20,000,000 5.05% Series C Senior Notes due October 1, 2010 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "Series C Notes", and together with the Series A Notes and the Series B Notes, collectively, the "Notes"). The Noteholders are the holders of all of the outstanding principal amount of the Notes. B. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of February 27, 1998, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of October 1, 2003, to Note Purchase Agreements dated as of February 27, 1998, that certain Second Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of February 27, 1998, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of February 27, 1998 (as amended, restated or otherwise modified from time to time, the "Existing 1998 NPA Waiver") and that certain Second Waiver and Amendment, dated as of the date hereof, to Note Purchase Agreements dated as of February 27, 1998 (as amended, restated or otherwise modified from time to time, the "New 1998 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "1998 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $80,000,000 6.71% Series A Senior Notes due February 27, 2008 (as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "1998 Notes") and (ii) $20,000,000 6.60% Series B Senior Notes due February 27, 2005 (which Series B Notes have since been paid in full by the Company). C. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of April 27, 2006, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of April 27, 2006 (as amended, restated or otherwise modified from time to time, the "Existing 2006 NPA Waiver") and that certain Second Waiver and Amendment dated as of the date hereof to Note Purchase Agreements dated as of April 27, 2006 (as amended, restated or otherwise modified from time to time, the "New 2006 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "2006 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its $150,000,000 6.15% Senior Notes due April 27, 2016 (all of such notes, as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "2006 Notes"). D. The Company has also previously entered into that certain Credit Agreement dated as of January 14, 2005, among the Company, the Borrowing Subsidiaries (as defined therein), JPMorgan Chase Bank, N.A., as agent (the "Agent"), and the other bank lenders party thereto (the "Banks"), as amended by that certain Letter Agreement, dated as of March 31, 2005, that certain First Amendment to Credit Agreement, dated as of August 12, 2005, that certain Second Amendment to Credit Agreement, dated as of March 31, 2006, that certain Waiver and Amendment Agreement, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Bank Waiver"), and that certain Second Waiver and Amendment Agreement (as amended, restated or otherwise modified from time to time, the "New Bank Waiver"), dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "Bank Credit Agreement"). E. The Company is also a party to (i) that certain Receivables Purchase Agreement, dated as of September 30, 2005, among the Company, as Servicer, Invacare Receivables Corporation, as Seller, Park Avenue Receivables Company, LLC and JPMorgan Chase Bank, N.A., as Agent, and the purchasers named on Schedule A thereto (the "Securitization Lenders") as amended by that certain Amendment No. 1 to Receivables Purchase Agreement, dated as of September 28, 2006 and that certain Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Securitization Waiver"), and that certain Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New Securitization Waiver", and together with the New 1998 NPA Waiver, the New 2006 NPA Waiver and the New Bank Waiver, the "Other December 2006 Waivers") (such Receivables Purchase Agreement, as amended, restated or otherwise modified from time to time, the "Securitization Purchase Agreement"), (ii) that certain Receivables Sale Agreement, dated as of September 30, 2005, among the Company, Invacare Receivables Corporation, Healthtech Products, Inc. and Invacare Supply Group, Inc. as amended by the Existing Securitization Waiver and the New Securitization Waiver (as amended, restated or otherwise modified from time to time, the "Securitization Sale Agreement") and (iii) that certain Performance Undertaking, dated as of September 30, 2005, in favor of Invacare Receivables Corporation (as amended, restated or otherwise modified from time to time, the "Performance Undertaking", and together with the 2 Securitization Sale Agreement and the Securitization Purchase Agreement, the "Securitization Documents", and the Securitization Documents, together with the 1998 Note Purchase Agreement, the 2006 Note Purchase Agreement and the Bank Credit Agreement, collectively, the "Other Primary Loan Agreements", and the Other Primary Loan Agreements, together with the Note Purchase Agreement, collectively, the "Primary Loan Agreements" and the Primary Loan Agreements, together with the other agreements, documents and instruments entered into in connection therewith or pursuant thereto, collectively, the "Primary Loan Documents"). F. Pursuant to (i) the Existing NPA Waiver, the Noteholders have agreed to waive, through December 15, 2006 (subject to the terms and conditions thereof) certain Defaults and Events of Default that otherwise would exist and be continuing under the Note Purchase Agreements and which are set forth on Schedule A attached hereto (collectively, the "Existing Defaults"), (ii) the Existing 1998 NPA Waiver, the holders of the 1998 Notes (the "1998 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 1998 Note Purchase Agreement, (iii) the Existing 2006 NPA Waiver, the holders of the 2006 Notes (the "2006 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2006 Note Purchase Agreement, (iv) the Existing Bank Waiver, the Banks have agreed to waive, through December 15, 2006, certain defaults and events of default under the Bank Credit Agreement and (v) the Existing Securitization Waiver, the Securitization Lenders have agreed to waive, through December 15, 2006, certain "Termination Events" and "Potential Termination Events" under (and as defined in) the Securitization Sale Agreement and certain "Amortization Events" and "Potential Amortization Events" under (and as defined in) the Securitization Purchase Agreement (all of such events, the "Existing Securitization Defaults" and together with any other such events from time to time existing under such documents, the "Securitization Defaults"). G. The Company has requested that the Noteholders agree to extend the waivers of the Existing Defaults under the Note Purchase Agreement, and the Noteholders are agreeable to such request, solely on the terms and conditions set forth herein, including, without limitation, the amendments described in Section 2 hereof. H. The Company has likewise requested that (i) the 1998 Noteholders agree to extend the waivers of the defaults and events of default under the 1998 Note Purchase Agreement pursuant to the terms of the New 1998 NPA Waiver, (ii) the 2006 Noteholders agree to extend the waivers of the defaults and events of default under the 2006 Note Purchase Agreement pursuant to the terms of the New 2006 NPA Waiver, (iii) the Banks agree to extend the waivers of the defaults and events of default under the Bank Credit Agreement (and waive any new defaults or events of default thereunder) pursuant to the terms of the New Bank Waiver and (iv) the Securitization Lenders agree to extend the waivers of the Existing Securitization Defaults under the Securitization Documents pursuant to the terms of the New Securitization Waiver. I. All requirements of law have been fully complied with and all other acts and things necessary to make this Waiver and Amendment a valid, legal, and binding instrument according to its terms for the purposes herein expressed have been done or performed. 3 NOW, THEREFORE, upon the full and complete satisfaction of the conditions precedent to the effectiveness of this Waiver and Amendment set forth in Section 4 hereof, and in consideration of good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the Company and the undersigned Noteholders do hereby agree as follows: SECTION 1. TEMPORARY WAIVER. (a) The Company acknowledges and agrees that, as a result of the Existing Defaults under the Note Purchase Agreement, the Noteholders may, on or after December 15, 2006, if they so elect, proceed to enforce their respective rights and remedies under the Note Purchase Agreement to collect the Company's obligations thereunder. (b) Subject to the terms and conditions of this Waiver and Amendment, the Noteholders hereby agree to temporarily waive (collectively, the "Waivers") the Existing Defaults during the period (the "Waiver Period") commencing on the Effective Date and expiring on the earliest to occur of (i) January 31, 2007, unless such date has been automatically extended to February 15, 2007 as provided in Section 1(c) below (the "Outside Waiver Termination Date"), (ii) any Default or Event of Default under the Note Purchase Agreement (including, without limitation, any Default or Event of Default arising out of a failure to comply with any term, covenant or condition of the Existing NPA Waiver, including Section 5 thereof as amended hereby), (iii) the breach or nonperformance by the Company or any Subsidiary of any covenant, agreement or condition set forth in this Waiver and Amendment or the Other December 2006 Waivers, (iv) any breach of, default, event of default or Securitization Default under any Other Primary Loan Agreement (or any amendment or waiver with respect thereto) or any termination or other expiration of the waiver period set forth in the Other December 2006 Waivers, and (v) the date on which any representation or warranty in Section 3 hereof fails to be true and correct. (c) The Outside Waiver Termination Date shall be automatically extended from January 31, 2007 to February 15, 2007, without notice or any other action, if (i) on or prior to December 22, 2006, the Company has provided each of the Noteholders with a fully executed commitment letter or letters (as amended or otherwise modified from time to time, collectively, the "Commitment Letters") providing fully underwritten commitments from one or more reputable financial institutions and/or institutional investors to provide financing to the Company in an aggregate amount sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007, in form and substance satisfactory to the Required Holders and (ii) the waiver period under each of the Other December 2006 Waivers has likewise been (or shall be, concurrently with the extension of the Waiver Period) extended to February 15, 2007 on terms and conditions satisfactory to the Required Holders; provided, however if on or prior to January 31, 2007, (x) any of the Commitment Letters is terminated (unless the commitments under the remaining Commitment Letters, after giving effect to such termination and any new Commitment Letter or Commitment Letters entered into by the Company in replacement of such terminated Commitment Letter and delivered to each of the Noteholders prior to such termination, are sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007) or (y) the waiver period under 4 any of the Other December 2006 Waivers shall have reverted to January 31, 2007 then, in any such case, the Outside Waiver Termination Date shall revert to January 31, 2007; provided, further that if any of the events described in the foregoing clauses (x) or (y) occurs after January 31, 2007, the Waiver Period shall expire as of the occurrence of such event without notice or any further action. (d) The waiver contemplated in this Section 1 shall be effective only for the Existing Defaults and only for the Waiver Period, and such waiver shall not entitle the Company 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 Noteholders. Such waiver shall not prejudice or constitute a waiver of any right or remedies which any Noteholder may have or be entitled to with respect to any other breach of any provision of any of the Note Purchase Agreement or the Notes. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement and Notes 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, an Event of Default will continue to exist under the Note Purchase Agreement, and the Noteholders may, 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 Note Purchase Agreement), accelerate the payment in full of the obligations owed to the Noteholders under the Note Purchase Agreement and Notes, and enforce and exercise any or all of the Noteholders' rights under or in respect of the Note Purchase Agreement and the Notes and under applicable law. (e) For avoidance of doubt, it is hereby acknowledged and agreed to by the Company that the addition of the agreements and covenants in Section 5 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 Noteholders, and the Noteholders shall retain all their rights and remedies under or in respect of the Note Purchase Agreement and Notes and under applicable law with respect to the Existing Defaults upon the expiration or termination of the Waiver Period. SECTION 2. AMENDMENTS. Section 2.1. Amendment and Restatement of the Notes. (a) Amendment and Restatement. (i) Each Series A Note is hereby, without any further action required on the part of any Person, deemed to be automatically amended to conform to and have the terms provided in Exhibit 2.1(a) to this Agreement (except that the principal amount and the payee of each such Series A Note shall remain unchanged). Any Series A Note issued on or after the Effective Date shall be in the form of Exhibit 2.1(a) to this Waiver and Amendment. (ii) Each Series B Note is hereby, without any further action required on the part of any Person, deemed to be automatically amended to conform to and have the terms provided in Exhibit 2.1(b) to this 5 Agreement (except that the principal amount and the payee of each such Series B Note shall remain unchanged). Any Series B Note issued on or after the Effective Date shall be in the form of Exhibit 2.1(b) to this Waiver and Amendment. (iii) Each Series C Note is hereby, without any further action required on the part of any Person, deemed to be automatically amended to conform to and have the terms provided in Exhibit 2.1(c) to this Agreement (except that the principal amount and the payee of each such Series C Note shall remain unchanged). Any Series C Note issued on or after the Effective Date shall be in the form of Exhibit 2.1(c) to this Waiver and Amendment. (b) Replacement Notes. Upon the request of any Noteholder, the Company will issue a replacement Note or Notes (consistent with the terms hereof) in favor of such Noteholder in the appropriate form in exchange for the Note or Notes of such Noteholder delivered to the Company at the time of such exchange. Section 2.2. Amendments of Existing NPA Waiver. (a) Section 5 of the Existing NPA Waiver is hereby amended by deleting the phrase "and continuing through April 15, 2007" in the third and fourth lines thereof. (b) Section 5(b) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(b) the Company will not, and will not permit any of its Subsidiaries to, at any time, directly or indirectly (i) create, incur, assume, guarantee, or otherwise become liable in respect of (A) any Debt of the Company other than Debt incurred under the Credit Agreement, (B) any Debt of Subsidiaries other than Debt incurred under the Credit Agreement by Subsidiaries that are party to the Credit Agreement as of December 15, 2006 and (C) any Securitization except that one or more Special Purpose Subsidiaries that are party to the Securitization Documents as of December 15, 2006 may become liable in respect of a Permitted Receivables Securitization Program not exceeding $75,401,750 (not including obligations in respect of fees, expenses, indemnities and other reimbursement obligations permitted under such Permitted Receivables Securitization Program) in the aggregate at any time and (ii) create, incur, assume or suffer to exist, any Lien securing any Debt of the Company or any Subsidiary or any Lien created, incurred, assumed or otherwise existing with respect to any Securitization, except Liens incurred on receivables, related assets and collections of the Company or any Subsidiary in connection with such assets being transferred to a Special Purpose Subsidiary pursuant to a Permitted Receivables Securitization Program as permitted in accordance with Section 5(f) of this Waiver; as used in this Section 5(b), "Securitization" means one or more transactions wherein the Company and/or a Subsidiary transfers receivables, related assets and collections of the Company and/or such Subsidiary to a special purpose Subsidiary which issues or incurs indebtedness secured by such receivables and all of its other assets;" 6 (c) Section 5(i) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(i) the Company will not, and will not permit any Subsidiary to, (x) enter into any agreement restricting the ability of the Company and its Subsidiaries to amend or modify the Note Purchase Agreement or Notes or any document or instrument executed in connection therewith, except as set forth in the waiver/amendment to the Bank Credit Agreement referred to in Section 3(c) hereof or (y) enter into any agreement or arrangement requiring any defeasance of the Bank Credit Agreement; and" SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. To induce the Noteholders to execute and deliver this Waiver and Amendment (which representations shall survive the execution and delivery of this Waiver and Amendment), the Company represents and warrants to the Noteholders that: (a) this Waiver and Amendment has been duly authorized, executed and delivered by it and this Waiver and Amendment constitutes the legal, valid and binding obligation, contract and agreement of the Company enforceable against it 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 Note Purchase Agreement, as modified by this Waiver and Amendment, constitutes the legal, valid, and binding obligations, contracts, and agreements of the Company 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, delivery and performance by the Company of this Waiver and Amendment (i) has been duly authorized by all requisite corporate action and, if required, shareholder action, (ii) does not require the consent or approval of any governmental or regulatory body or agency, and (iii) does not and will not (A) violate (1) any provision of law, statute, rule or regulation or its certificate of incorporation or bylaws, (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 referred to in clause (iii)(A)(3) of this Section 3(c) or (C) result in the creation of any Lien; (d) as of the date hereof and after giving effect to this Waiver and Amendment and the Other December 2006 Waivers, (i) no Default or Event of Default has occurred which is continuing under the Note Purchase Agreement, 7 (ii) no default, event of default, Securitization Default or similar event has occurred and is continuing under any Other Primary Loan Agreement; and (e) all the representations and warranties made by the Company in the Note Purchase Agreement 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; (f) neither the Company nor any of its Affiliates has paid or agreed to pay any fees or other consideration, or given any additional security or collateral, or shortened the maturity or average life of any indebtedness or permanently reduced any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company, in connection with the obtaining of any consents or approvals in connection with the transactions contemplated hereby (including, without limitation, under the Other Primary Loan Agreements), other than (i) with respect to the Notes, the payment of the waiver fees referred to in Section 4(b)(i) below and the additional fee payable in accordance with Section 5.2 below, (ii) with respect to the 1998 Notes, a waiver fee equal to 0.10% of the aggregate outstanding principal amount of the 1998 Notes paid pro rata to the 1998 Noteholders, (iii) with respect to the 2006 Notes, a waiver fee equal to 0.10% of the aggregate outstanding principal amount of the 2006 Notes paid pro rata to the 2006 Noteholders, (iv) with respect to the Bank Credit Agreement, a waiver fee equal to 0.10% of the aggregate commitments of the Banks, (v) the waiver fee payable to the Securitization Lenders under Section 4 of the New Securitization Waiver and (vi) with respect to the 1998 Notes, the 2006 Notes and the Bank Credit Agreement, a fee payable to the Banks, the 1998 Noteholders and the 2006 Noteholders, respectively, on substantially identical terms to those set forth in Section 5.2 below with respect to the fee payable to the holders of Notes under such Section; (g) the amount of Consolidated Debt of the Company and its Subsidiaries (as defined in and as calculated under the Note Purchase Agreement) as of December 15, 2006, is $500,762,618, as described in further detail on Schedule B hereto; (h) the amount of all Revolving Credit Advances (as defined in the Bank Credit Agreement) outstanding under the Bank Credit Agreement as of December 15, 2006 is $157,893,617, consisting of $117,254,840 in Revolving Credit Advances made to Subsidiaries and $40,638,778 in Revolving Credit Advances made to the Company; and as of December 15, 2006, there are no Bid-Option Loans (as defined in the Bank Credit Agreement) outstanding; (i) on December 15, 2006, the Company and its Subsidiaries have the right to obtain Advances (as defined in the Credit Agreement) of $20,000,000 under the Credit Agreement; (j) except as set forth and described in the Recitals hereto, the Company has not entered into any amendment or waiver or entered into any agreement having the effect of an amendment or waiver with respect to any provision of any of the Primary Loan Documents; and 8 (k) 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. SECTION 4. CONDITIONS TO EFFECTIVENESS; POST-CLOSING COVENANTS. (a) The Waivers shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied (the "Effective Date"): (i) executed counterparts of this Waiver and Amendment, duly executed by the Company and the Required Holders, shall have been delivered to the Noteholders; (ii) the representations and warranties of the Company set forth in Section 3 hereof are true and correct on and with respect to the date hereof and (except to the extent that any of such representations and warranties expressly relate by their terms to a prior date) the Effective Date; (iii) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Bank Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing Bank Waiver, together with any other defaults or events of default that have occurred and are continuing, for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder), and on the Effective Date, after giving effect to the New Bank Waiver, (i) the Company and its Subsidiaries have the right to obtain Advances of not less than $20,000,000 under the Credit Agreement and (ii) the "Termination Date" under the Credit Agreement shall not be on a date prior to January 14, 2010; (iv) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 1998 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 1998 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (v) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 2006 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 2006 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, 9 or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vi) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Securitization Waiver which shall provide for an amendment, modification, waiver, or consent necessary to waive the Existing Securitization Defaults for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vii) the Company shall have acknowledged and agreed to an engagement agreement between Bingham McCutchen LLP (on behalf of the Noteholders) and FTI Consulting, Inc. (as amended, restated or otherwise modified from time to time, the "Financial Advisor Engagement Agreement") satisfactory in form and substance to the Noteholders and their special counsel; (viii) the Company shall have acknowledged and agreed to an engagement agreement among the Noteholders and Bingham McCutchen LLP (as amended, restated or otherwise modified from time to time, the "Bingham Engagement Agreement", and together with the Financial Advisor Engagement Agreement, the "Engagement Agreements") satisfactory in form and substance to the Noteholders and their special counsel; (ix) the Noteholders shall have received a copy of the resolutions of the Board of Directors of the Company authorizing the execution, delivery, and performance by the Company of this Waiver and Amendment, certified by its Secretary or an Assistant Secretary, together with documentation evidencing all other proceedings taken in connection with the transactions contemplated by this Waiver and Amendment, and all documents necessary to the consummation thereof, in each case, which shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel; (x) the Noteholders shall have received such lien searches with respect to the Company as are reasonably required by the Noteholders or their special counsel; and (xi) a statement of the Company's and its Subsidiaries' cash balances as of the close of business on Friday, December 15, 2006, certified as true and correct by a Senior Financial Officer. (b) The Company shall, on or prior to December 18, 2006: (i) pay to each Noteholder, by wire transfer of immediately availably funds, a waiver fee, whether or not such holder has signed this Waiver and Amendment, in an amount equal to 0.10% of the aggregate outstanding 10 principal amount of the Notes held by such Noteholder; such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is terminated or rescinded for any reason; (ii) pay the reasonable fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP, and the Noteholder's financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby, and any fees and expenses of Chapman and Cutler LLP in connection with the negotiation, preparation, execution and delivery of the Existing NPA Waivers that have not yet been paid; the payment of the fees and disbursements pursuant to this Section 4(b)(ii) does not preclude the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 6 of this Waiver and Amendment or Section 16 of the Note Purchase Agreement; and (iii) pay the fee reserves payable to the Bingham McCutchen LLP and FTI Consulting, Inc. under the terms of their respective Engagement Letters. The failure of the Company to comply with any of the covenants set forth in this Section 4(b) shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 5. COVENANTS. In addition to and without limiting the Company's obligations under the Note Purchase Agreement, the Company covenants and agrees that at all times from and after the date hereof: Section 5.1. Compliance with Financial Advisor Engagement Agreement. The Company shall comply with each of the terms and conditions of the Financial Advisor Engagement Agreement. Section 5.2. Fee Upon Failure to Deliver (or Termination of) Commitment Letters. If either (i) the condition set forth in Section 1(c)(i) of this Waiver and Amendment is not met or (ii) the event set forth in clause (x) of the first proviso to Section 1(c)(i) of this Waiver and Amendment occurs, the Company shall pay, and there shall become due and payable, on the next Business Day following the first to occur of the events set forth in the foregoing clause (i) or clause (ii), a fee to each Noteholder in an amount equal to 0.15% of the aggregate outstanding principal amount of the Notes then held by such Noteholder (which fee shall be paid by wire transfer of immediately available funds); such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is thereafter terminated or rescinded for any reason. Section 5.3. Payment of Additional Fees or Compensation to Creditors. The Company will not, and will not permit any of its Subsidiaries or Affiliates to, pay or agree to pay any fees or other consideration, or give any additional security or collateral, or shorten the maturity or average life of any indebtedness or permanently reduce any borrowing capacity, in each case, in 11 favor of or for the benefit for any creditor of the Company (or any agent of any creditor or group of creditors) without the prior written consent of the Required Holders (other than a fee payable to the Banks, the 1998 Noteholders and the 2006 Noteholders on substantially identical terms to those set forth in Section 5.2 above with respect to the fee payable to the Noteholders under such Section). Section 5.4. Amendments to Primary Loan Documents. The Company will not permit any Primary Loan Document or any amendment or waiver of any Primary Loan Document (in each case, other than the Note Purchase Agreement and the Notes), to be amended, waived or otherwise modified after the date hereof without the prior written consent of the Required Holders. Section 5.5. Closing of New Credit Facilities; Prepayment. The Company covenants and agrees that it shall close the credit facilities which are the subject of the Commitment Letters on or before February 15, 2007 and it shall make a drawing under such credit facilities on or before February 15, 2007 for the purpose of prepaying all amounts owing under the Note Purchase Agreement. Any such prepayment shall be deemed to be an optional prepayment of the Company's obligations under the Note Purchase Agreement and the Notes in accordance with Section 8.2 of the Note Purchase Agreement, and the Noteholders waive the requirement of prior written notice of prepayment thereunder in connection with such prepayment. The failure of the Company to comply with any of the covenants set forth in this Section 5 shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 6. FEES AND EXPENSES. The Company shall pay the fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP and the Noteholders' financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby in accordance with the terms of the Engagement Letters. This provision shall be supplementary to, and shall not in any way be deemed to limit, the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 16 of the Note Purchase Agreement. SECTION 7. RELEASE. In order to induce the Noteholders to enter into this Waiver and Amendment, the Company acknowledges and agrees that: (a) neither the Company nor any of its Subsidiaries has any claim or cause of action against any of the Noteholders or any of their respective directors, trustees, officers, employees or agents (collectively, the "Released Parties") relating to or arising out of the Note Purchase Agreement or Notes or any of the transactions related thereto; (b) neither the Company nor any of its 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; and (c) each of the Released Parties has heretofore properly performed and satisfied in 12 a timely manner all of its obligations to the Company and its Subsidiaries under the Note Purchase Agreement. Notwithstanding this representation and as further consideration for the agreements and understandings herein, the Company, on behalf of itself and its employees, agents, executors, heirs, successors and assigns (the "Releasing Parties"), hereby releases the Noteholders, its respective predecessors, officers, directors, trustees, 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 Note Purchase Agreement or Notes or any of the transactions relating thereto. No Released Party shall be liable with respect to, and the Company hereby waives, releases and agrees not to sue for, any special, indirect or consequential damages relating to the Note Purchase Agreement and the Notes or arising out of its activities in connection herewith or therewith (whether before, on or after the date hereof). SECTION 8. AMENDMENTS AND WAIVERS. This Waiver and Amendment may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders. SECTION 9. DEFINITIONS. Capitalized terms used herein shall have the respective meanings ascribed thereto in the Note Purchase Agreement, unless defined herein (in which case such terms shall have the meanings set forth herein) or the context shall otherwise require. SECTION 10. MISCELLANEOUS. Section 10.1. More Favorable Provisions. The Company acknowledges and agrees that any covenants, defaults or similar provisions set forth in any of the Other December 2006 Waivers not substantially provided for in this Waiver and Amendment, or any such covenants, defaults or similar provisions that are more favorable to the creditors thereunder than the covenants, defaults or similar provisions hereunder, are hereby incorporated by reference into this Waiver and Amendment 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. Section 10.2. Construction; References to Note Purchase Agreement. This Waiver and Amendment shall be construed in connection with and as part of the Note Purchase Agreement. Any and all notices, requests, certificates and other instruments executed and delivered after the execution and delivery of this Waiver and Amendment may refer to the Note Purchase Agreement without making specific reference to this Waiver and Amendment but nevertheless all such references shall include this Waiver and Amendment unless the context otherwise requires. This Waiver and Amendment shall not be construed more strictly against the Noteholders merely by virtue of the fact that the same has been prepared by the Noteholders or their counsel, it being recognized that the Company and the Noteholders have contributed substantially and materially to the preparation of 13 this Waiver and Amendment, 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 Waiver and Amendment. Section 10.3. Ramifications of Waiver; Reaffirmation. The Company acknowledges that the waivers and amendments granted hereunder by the Noteholders shall not be construed as an agreement to amend or waive any other provision of any of the Note Purchase Agreement, and the Noteholders shall have no obligation to enter into any such amendment or waiver. Other than the Existing Defaults temporarily waived during the Waiver Period, none of the Noteholders have waived, nor are they by this Waiver and Amendment waiving, and have made no commitment to waive, any other Default or Event of Default that may occur or be continuing on the date hereof or may occur or be continuing after the date hereof. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement as a result of any other such Default or Event of Default. No delay or omission of the Noteholders to exercise any right under the Note Purchase Agreement shall impair any such right or be construed to be a waiver of any other such Default or Event of Default or an acquiescence therein. Except as modified, waived or expressly amended by this Waiver and Amendment, all terms, conditions, and covenants contained in the Note Purchase Agreement are hereby ratified and confirmed by the Company and shall be and remain in full force and effect. Section 10.4. Affirmation of Recitals; etc. The Company hereby acknowledges and affirms the accuracy of all recitals to this Waiver and Amendment. The Company represents that neither it, nor any of its Subsidiaries, has any intention to file or acquiesce in the filing of any bankruptcy or insolvency proceeding hereafter and that the Company believes that the period of time allowed by this Waiver and Amendment is sufficient for the Company and its Subsidiaries to accomplish the transactions that they have undertaken as represented by the Company to the Noteholders. Section 10.5. Further Assurances. The Company will, and will cause each of its Subsidiaries to, execute and deliver any and all documents reasonably deemed necessary or appropriate by the Noteholders to carry out the intent of and/or to implement this Waiver and Amendment. Section 10.6. Section Headings. The descriptive headings of the various Sections or parts of this Waiver and Amendment are for convenience only and shall not affect the meaning or construction of any of the provisions hereof. Section 10.7. Governing Law. This Waiver and Amendment shall be governed by and construed and enforced in accordance with the law of the State of New York, excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. Section 10.8. Survival. The provisions of Sections 6 and 7 of this Waiver and Amendment shall survive and continue in effect following any termination, rescission or expiration of this Waiver and Amendment. 14 Section 10.9. Time is of the Essence. TIME IS OF THE ESSENCE WITH RESPECT TO ALL COVENANTS, CONDITIONS, AGREEMENTS, OR OTHER PROVISIONS HEREIN. Section 10.10. Counterparts. This Waiver and Amendment may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this Waiver and Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Waiver and Amendment. [Remainder of page left intentionally blank] If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Waiver and Amendment and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company. INVACARE CORPORATION By: /s/ Gregory C. Thompson Name: Gregory C. Thompson Title: Chief Financial Officer The foregoing is hereby agreed to as of the date thereof: AMERICAN UNITED LIFE INSURANCE COMPANY By /s/ Michael I. Bullock Name: Michael L. Bullock Title: V.P. Private Placements THE LAFAYETTE LIFE INSURANCE COMPANY By: American United Life Insurance Company, Its Agent By /s/ Michael I. Bullock Name: Michael L. Bullock Title: V.P. Private Placements METROPOLITAN LIFE INSURANCE COMPANY By: /s/ Judith Gulotta Name: Judith Gulotta Title: Director MEDICAL PROTECTIVE COMPANY By Name: Title: The foregoing is hereby agreed to as of the date thereof: GENERAL LIFE INSURANCE COMPANY By /s/ John R. Enders Name: John R. Enders Title: Investment Officer GENWORTH LIFE AND ANNUITY INSURANCE COMPANY (F/K/A GE Life and Annuity Assurance Company) By /s/ John R. Enders Name: John R. Enders Title: Investment Officer MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY By: Babson Capital Management LLC, as Investment Adviser By /s/ Thomas P.Shea Name: Thomas P.Shea Title: Managing Director C.M. LIFE INSURANCE COMPANY By: Babson Capital Management LLC, as Investment Sub-Adviser By /s/ Thomas P.Shea Name: Thomas P.Shea Title: Managing Director The foregoing is hereby agreed to as of the date thereof: TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA By: /s/ Roi G. Chandy Name: Roi G. Chandy Title: Director TIAA-CREF LIFE INSURANCE COMPANY By: Teachers Insurance and Annuity Association of America, as Investment Manager By: /s/ Roi G. Chandy Name: Roi G. Chandy Title: Director PRINCIPAL LIFE INSURANCE COMPANY By: Principal Global Investors, LLC a Delaware limited liability company, its authorized signatory By /s/ Deborah Svoboda EPP Name: Deborah Svoboda Title: EPP Counsel By /s/ James C. Fifield Name: James C. Fifield Title: Counsel The foregoing is hereby agreed to as of the date thereof: PIONEER MUTUAL LIFE INSURANCE COMPANY By: American United Life Insurance Company, Its Agent By /s/ Michael I. Bullock Name: Michael I. Bullock Title: V.P. Private Placements THE STATE LIFE INSURANCE COMPANY By: American United Life Insurance Company, Its Agent By /s/ Michael I. Bullock Name: Michael I. Bullock Title: V.P. Private Placements AMERICAN FAMILY LIFE INSURANCE COMPANY By /s/ Phillip Hannifan Name: Phillip Hannifan Title: Investment Director The foregoing is hereby agreed to as of the date thereof: GE REINSURANCE CORPORATION By /s/ John H DeMallie Name: John H DeMallie Title: Vice President AMERITAS LIFE INSURANCE CORP. By Ameritas Investment Advisors Inc., as Agent By /s/ Andrew S. White Name: Andrew S. White Title: Vice President - Fixed Income Securities ACACIA LIFE INSURANCE CORP. By Ameritas Investment Advisors Inc., as Agent By /s/ Andrew S. White Name: Andrew S. White Title: Vice President - Fixed Income Securities Schedule A Existing Defaults Events of Default under Section 12.1(c) of the Note Purchase Agreement by virtue of (a) the continuing failure of the Company to comply with Section 11.3 (the Consolidated Debt covenant which is tested at all times) and (b) the failure of the Company to give the written notice of its failure to comply with Section 11.3, as required by Section 7.1(d). Events of Default under Section 12(f) of the Note Purchase Agreement (by operation of Section 5(j) of the Existing NPA Waiver) due to the existence of the defaults, events of default and Securitization Defaults described in the Other December 2006 Waivers. Schedule B Description of Consolidated Debt [to be provided by the Company] EXHIBIT 2.1(a) THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. [FORM OF SERIES A SENIOR NOTE] INVACARE CORPORATION 3.97% SERIES A SENIOR NOTE DUE OCTOBER 1, 2007 No. RA -__ PPN: $__________ [Date] FOR VALUE RECEIVED, the undersigned, INVACARE CORPORATION, an Ohio corporation (herein called the "Company"), hereby promises to pay to _______________ or registered assigns, the principal sum of _________________________________ DOLLARS ($__________) on October 1, 2007, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at a rate equal to 3.97% per annum from the date hereof, payable semiannually on April 1 and October 1 in each year, commencing with the April 1 or October 1 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment of interest, and, during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements (defined below)), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the Series A Default Rate (as defined in the Note Purchase Agreements). Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at Elyria, Ohio or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of the 3.97% Series A Senior Notes due October 1, 2007 (herein called the "Notes") issued pursuant to separate Note Purchase Agreements, each dated as of October 1, 2003, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of October 1, 2003, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of October 1, 2003, and that certain Second Waiver and Amendment, dated as of December 15, 2006, to Note Purchase Agreements dated as of October 1, 2003 (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, collectively, the "Note Purchase Agreements"), among the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 21 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer, duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. This Note is subject to certain prepayments in the events, on the terms and in the manner and amounts as provided in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. INVACARE CORPORATION By: Name: ________________________________ Title: _______________________________ EXHIBIT 2.1(b) THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. [FORM OF SERIES B SENIOR NOTE] INVACARE CORPORATION 4.74% SERIES B SENIOR NOTE DUE OCTOBER 1, 2009 No. RB -__ PPN: $__________ [Date] FOR VALUE RECEIVED, the undersigned, INVACARE CORPORATION, an Ohio corporation (herein called the "Company"), hereby promises to pay to _______________ or registered assigns, the principal sum of _________________________________ DOLLARS ($__________) on October 1, 2009, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at a rate equal to 4.74% per annum from the date hereof, payable semiannually on April 1 and October 1 in each year, commencing with the April 1 or October 1 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment of interest, and, during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements (defined below)), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the Series B Default Rate (as defined in the Note Purchase Agreements). Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at Elyria, Ohio or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of the 4.74% Series B Senior Notes due October 1, 2009 (herein called the "Notes") issued pursuant to separate Note Purchase Agreements, each dated as of October 1, 2003, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of October 1, 2003, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of October 1, 2003, and that certain Second Waiver and Amendment, dated as of December 15, 2006, to Note Purchase Agreements dated as of October 1, 2003 (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, collectively, the "Note Purchase Agreements"), among the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 21 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer, duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. This Note is subject to certain prepayments in the events, on the terms and in the manner and amounts as provided in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. INVACARE CORPORATION By: Name: ________________________________ Title: _______________________________ EXHIBIT 2.1(c) THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. [FORM OF SERIES C SENIOR NOTE] INVACARE CORPORATION 5.05% SERIES C SENIOR NOTE DUE OCTOBER 1, 2010 No. RC -__ PPN: $__________ [Date] FOR VALUE RECEIVED, the undersigned, INVACARE CORPORATION, an Ohio corporation (herein called the "Company"), hereby promises to pay to _______________ or registered assigns, the principal sum of _________________________________ DOLLARS ($__________) on October 1, 2010, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at a rate equal to 5.05% per annum from the date hereof, payable semiannually on April 1 and October 1 in each year, commencing with the April 1 or October 1 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment of interest, and, during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements (defined below)), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the Series C Default Rate (as defined in the Note Purchase Agreements). Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at Elyria, Ohio or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of the 5.05% Series C Senior Notes due October 1, 2010 (herein called the "Notes") issued pursuant to separate Note Purchase Agreements, each dated as of October 1, 2003, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of October 1, 2003, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of October 1, 2003, and that certain Second Waiver and Amendment, dated as of December 15, 2006, to Note Purchase Agreements dated as of October 1, 2003 (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, collectively, the "Note Purchase Agreements"), among the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 21 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer, duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. This Note is subject to certain prepayments in the events, on the terms and in the manner and amounts as provided in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. INVACARE CORPORATION By: Name: ________________________________ Title: _______________________________ EX-10 4 exhibit3.txt 10.3 Exhibit 10.3 SECOND WAIVER AND AMENDMENT AGREEMENT THIS SECOND WAIVER AND AMENDMENT AGREEMENT (this "Agreement"), dated as of December 15, 2006 is by and among Invacare Corporation (the "Company"), each of the Borrowing Subsidiaries party to the Credit Agreement (as defined below) (collectively with the Company, the "Borrowers"), the banks set forth on the signature pages hereof (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 are parties 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"), including modifications pursuant to that certain Waiver and Amendment Agreement dated as of November 14, 2006 (the "Existing Waiver"), among the Borrowers, the Banks and the Agent. B. The Company has previously entered into separate and several Note Purchase Agreements, each dated as of April 27, 2006, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain Waiver and Amendment, dated as of November 14, 2006 (as amended, restated or otherwise modified, the "Existing 2006 NPA Waiver"), to Note Purchase Agreements dated as of April 27, 2006 and that certain Second Waiver and Amendment to 2006 Note Purchase Agreements dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New 2006 NPA Waiver"), (as amended, restated or otherwise modified from time to time, collectively, the "2006 Note Purchase Agreement"), pursuant to which the Company issued and sold its $150,000,000 6.15% Senior Notes due April 27, 2016 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "2006 Notes"). C. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of February 27, 1998, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of October 1, 2003, to Note Purchase Agreements dated as of February 27, 1998, that certain Second Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of February 27, 1998, that certain Waiver and Amendment dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing 1998 NPA Waiver"), to Note Purchase Agreements dated as of February 27, 1998 and that certain Second Waiver and Amendment to 1998 Note Purchase Agreements dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New 1998 NPA Waiver"), (as amended, restated or otherwise modified from time to time, collectively, the "1998 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $80,000,000 6.71% Series A Senior Notes due February 27, 2008 (as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "1998 Notes") and (ii) $20,000,000 6.60% Series B Senior Notes due February 27, 2005 (which Series B Notes have since been paid in full by the Company). D. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of October 1, 2003, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreement dated as of October 1, 2003, that certain Waiver and Amendment dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing 2003 NPA Waiver"), to Note Purchase Agreements dated as of October 1, 2003 and that certain Second Waiver and Amendment to 2003 Note Purchase Agreements dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New 2003 NPA Waiver" and, collectively with the New 2006 NPA Waiver and the New 1998 NPA Waiver, the "New NPA Waivers"), (as amended, restated or otherwise modified from time to time, collectively, the "2003 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $50,000,000 3.97% Series A Senior Notes due October 1, 2007, (ii) $30,000,000 4.74% Series B Senior Notes due October 1, 2009, and (iii) $20,000,000 5.05% Series C Senior Notes due October 1, 2010 (all of such notes, as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "2003 Notes"). E. The Company is also a party to (i) that certain Receivables Purchase Agreement, dated as of September 30, 2005, among the Company, as Servicer, Invacare Receivables Corporation, as Seller, Park Avenue Receivables Company, LLC and JPMorgan Chase Bank, N.A., as Agent, and the purchasers named on Schedule A thereto (the "Securitization Lenders") as amended by that certain Amendment No. 1 to Receivables Purchase Agreement, dated as of September 28, 2006 and that certain Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking dated as of November 14, 2006 (the "Existing Securitization Waiver"), and that certain Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking dated as of the date hereof (the "New Securitization Waiver", and together with the New NPA Waivers, the "Other December 2006 Waivers"), (as amended, restated or otherwise modified from time to time, the "Securitization Purchase Agreement"), (ii) that certain Receivables Sale Agreement, dated as of September 30, 2005, among the Company, Invacare Receivables Corporation, Healthtech Products, Inc. and Invacare Supply Group, Inc. as amended by the Existing Securitization Waiver and the New Securitization Waiver (as amended, restated or otherwise modified from time to time, the "Securitization Sale Agreement") and (iii) that certain Performance Undertaking, dated as of September 30, 2005, in favor of Invacare Receivables Corporation (as amended, restated or otherwise modified from time to time, the "Performance Undertaking", and together with the Securitization Sale Agreement and the Securitization Purchase Agreement, the "Securitization Documents", and the Securitization Documents, together with the 2006 Note Purchase Agreement, the 1998 Note Purchase Agreement, the 2003 Note Purchase Agreement, collectively, the "Other Primary Loan Agreements", and the Other Primary Loan Agreements, together with the Credit Agreement, collectively, the "Primary Loan Agreements" and the Primary Loan Agreements, together with the other agreements, documents and instruments entered into in connection therewith or pursuant thereto, collectively, the "Primary Loan Documents"). F. Pursuant to (i) the Existing Waiver, the Banks have agreed to waive, through December 15, 2006 (subject to the terms and conditions thereof) certain Existing Defaults (as defined in the Existing Waiver) that otherwise would exist and be continuing under the Credit Agreement, (ii) the Existing 2006 NPA Waiver, the holders of the 2006 Notes (the "2006 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2006 2 Note Purchase Agreement (iii) the Existing 1998 NPA Waiver, the holders of the 1998 Notes (the "1998 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 1998 Note Purchase Agreement, (iv) the Existing 2003 NPA Waiver, the holders of the 2003 Notes (the "2003 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2003 Note Purchase Agreement, and (v) the Existing Securitization Waiver, the Securitization Lenders have agreed to waive, through December 15, 2006, certain "Termination Events" and "Potential Termination Events" under (and as defined in) the Securitization Sale Agreement and certain "Amortization Events" and "Potential Amortization Events" under (and as defined in) the Securitization Purchase Agreement (all of such events, the "Existing Securitization Defaults" and together with any other such events from time to time existing under such documents, the "Securitization Defaults"). G. The Company has requested that the Banks agree to extend the waivers of the Existing Defaults under the Credit Agreement which were provided under the Existing Waiver and also waive any Default caused by a breach of the financial covenants set forth in Sections 5.2(a) and 5.2(c) of the Credit Agreement for the fiscal quarter ending December 31, 2006, and the Banks signatory hereto are agreeable to such request, solely on the terms and conditions set forth herein. H. The Company has likewise requested that (i) the 2006 Noteholders agree to extend the waivers of the defaults and events of default under the 2006 Note Purchase Agreement pursuant to the terms of the New 2006 NPA Waiver, (ii) the 1998 Noteholders agree to extend the waivers of the defaults and events of default under the 1998 Note Purchase Agreement pursuant to the terms of the New 1998 NPA Waiver, (iii) the 2003 Noteholders agree to extend the waivers of the defaults and events of default under the 2003 Note Purchase Agreement pursuant to the terms of the New 2003 NPA Waiver, and (iv) the Securitization Lenders agree to extend the Existing Securitization Defaults under the Securitization Documents pursuant to the terms of the New Securitization Waiver. I. All requirements of law have been fully complied with and all other acts and things necessary to make this Agreement a valid, legal, and binding instrument according to its terms for the purposes herein expressed have been done or performed. NOW, THEREFORE, upon the full and complete satisfaction of the conditions precedent to the effectiveness of this Agreement, 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 Waivers. 1.1 Each Borrower hereby acknowledges and agrees that, as a result of the Existing Defaults under the Credit Agreement, the Banks may, on or after December 15, 2006, if they so elect, 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 (a) Subject to the terms and conditions of this Agreement, the Banks agree to temporarily waive (the "Waiver") the Existing Defaults and any Default that may occur due to a breach of Sections 5.2(a) or 5.2(c) for the fiscal quarter ending December 31, 2006 (the "Waived Defaults") during the period (the 3 "Waiver Period") commencing on the date hereof and expiring on the earliest to occur of (A) January 31, 2007, unless such date has been automatically extended to February 15, 2007 as provided in Section 1.2(b) below (the "Outside Waiver Termination Date"), (B) any Default or Event of Default under any Loan Document other than the Waived Defaults, (C) the breach or nonperformance by the Company or any Subsidiary of any covenant, agreement or condition set forth in this Agreement or the Other December 2006 Waivers, (iv) any breach of, default, event of default or Securitization Default under any Other Primary Loan Agreement (or any amendment or waiver with respect thereto) or any termination or other expiration of the waiver period set forth in the Other December 2006 Waivers, and (D) the date on which any representation or warranty in Section 4 hereof fails to be true and correct. (b) The Outside Waiver Termination Date shall be automatically extended from January 31, 2007 to February 15, 2007, without notice or any other action, if (i) on or prior to December 22, 2006, the Company has provided the Agent and each of the Bank with a fully executed commitment letter or letters (as amended or otherwise modified from time to time, collectively, the "Commitment Letters") providing fully underwritten commitments from one or more reputable financial institutions and/or institutional investors to provide financing to the Company in an aggregate amount sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007, in form and substance satisfactory to the Required Banks and the "Required Holders" (as defined in the Note Purchase Agreements) in accordance with each of the New NPA Waivers, and (ii) the waiver period under each of the Other December 2006 Waivers has likewise been (or shall be, concurrently with the extension of the Waiver Period) extended to February 15, 2007 on terms and conditions satisfactory to the Required Banks; provided, however if on or prior to January 31, 2007, (x) any of the Commitment Letters is terminated (unless the commitments under the remaining Commitment Letters, after giving effect to such termination and any new Commitment Letter or Commitment Letters entered into by the Company in replacement of such terminated Commitment Letter and delivered to the Agent and each of the Banks prior to such termination, are sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007) or (y) the waiver period under any of the Other December 2006 Waivers shall have reverted to January 31, 2007 then, in any such case, the Outside Waiver Termination Date shall revert to January 31, 2007; provided, further that if any of the events described in the foregoing clauses (x) or (y) occurs after January 31, 2007, the Waiver Period shall expire as of the occurrence of such event without notice or any further action. 1.3 The Waiver shall be effective only for the Waived 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 Waived 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 Waived 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. 4 SECTION 2. Amendments to the Existing Waiver. Subject to the terms and conditions of this Agreement, the Existing Waiver is hereby and shall be amended as follows: 2.1 Section 2.5 of the Existing Waiver is hereby amended by deleting the phrase "and continuing through April 15, 2007" in the second line thereof. SECTION 3. 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: 3.1 The following definitions are added to Section 1.1 of the Credit Agreement in appropriate alphabetical order: "New NPA Waivers" shall have the meaning set forth in the Second Waiver and Amendment Agreement. "Other December 2006 Waivers" shall have the meaning set forth in the Second Waiver and Amendment Agreement. "Second Waiver Effective Date" shall mean December 15, 2006. "Second Waiver and Amendment Agreement" shall mean the Second Waiver and Amendment Agreement dated as of December 15, 2006 among the Borrowers, the Agent and the Banks. 3.2 Section 5.2(n) is restated 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, 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, the NPA Waivers or the New NPA Waivers, (iii) enter into any agreement or arrangement requiring any defeasance of any kind of any of the Senior Unsecured Notes, (iv) amend, 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 delivered on the Waiver Effective Date and New NPA Waivers (collectively 5 the "NPA Waivers), 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 Second Waiver Effective Date, as modified by the New NPA Waivers; 3.3 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 the Second Waiver and Amendment Agreement; 3.4 Each of the Borrowers acknowledges and agrees that any covenants, defaults or similar provisions set forth in any of the Other December 2006 Waivers not substantially provided for in this Agreement, or more favorable to the creditors thereunder than the covenants, defaults or similar provisions hereunder, 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. 3.5 Notwithstanding anything to the contrary in the Credit Agreement, no amendment, modification, waiver or extension of the limitation on new Advances set forth in Section 2.1 of the Existing Waiver shall be effective unless the same shall be in writing and signed by the Borrowers, the Agent and each of the Banks. SECTION 4. 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 4 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 this Agreement), as well as the warranties and representations in this Section 4, shall survive the effectiveness of the Waiver set forth in this Agreement): (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; 6 (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 Waived Defaults and (ii) to the extent that any of such representations and warranties expressly relate by their terms to a prior date; (e) 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; (f) except for the Waived Defaults, no event has occurred and no condition exists that would constitute a Default or Event of Default; (g) the amount of Consolidated Total Debt of the Company and its Subsidiaries (as defined in and as calculated under the Credit Agreement) as of December 15, 2006 is $500,762,618 and is detailed on Schedule 3(g) hereto; (h) no principal or interest payments are due on the Senior Unsecured Notes at any time on or before February 15, 2007; (i) attached hereto as Exhibit A is the form of the New NPA Waiver and attached hereto as Exhibit B is the form of the New Securitization Waiver, and the Other December 2006 Waivers shall be 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 the Other Primary Loan Agreements to cause, any payment of such Indebtedness or obligations to become due prior to its due date. SECTION 5. Conditions to Effectiveness of the Waiver; Post-Closing Covenants . (a) 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 December 15, 2006: 7 (i) counterparts of this Agreement shall have been duly executed by each Borrower, the Agent and the Required Banks; (ii) the Other December 2006 Waivers shall be in form and substance satisfactory to the Agent and the Required Banks and shall be executed simultaneously herewith and be effective; (iii) after giving effect to this Agreement and the Other December 2006 Waivers, the representations and warranties of each Borrower set forth in Section 4 hereof, in Section 3 of the Existing Waiver and in Article IV of the Credit Agreement shall be true and correct on and with respect to the date hereof and on the Effective Date; and (iv) a statement of the Company's and its Subsidiaries' cash balances as of the close of business on December 15, 2006, certified as true and correct by a senior financial officer of the Company. (b) The Company shall, on or prior to December 18, 2006: (i) Pay to each Bank signatory to this Agreement on the Effective Date a fee in amount of 10 basis points, calculated on the amount of such Bank's Commitment, which fees shall be payable to the Agent, for the benefit of such Banks; and (ii) Pay the reasonable fees and disbursements of the Agent's counsel, Dickinson Wright PLLC, incurred in connection with the negotiation, preparation, execution and delivery of the Existing Waiver, this Agreement and the transactions contemplated hereby; the payment of the fees and disbursements pursuant to this Section 5(b)(ii) does not preclude the Agent's rights to indemnification and reimbursement for other costs and expenses as provided in Section 7 of this Agreement or Section 8.5 of the Credit Agreement. The failure of the Company to comply with any of the covenants set forth in this Section 5(b) shall constitute, and shall be deemed to constitute, an immediate Event of Default under the Credit Agreement. SECTION 6. Covenants. In addition to and without limiting the Company's obligations under the Credit Agreement, the Company covenants and agrees that at all times from and after the date hereof: 6.1 In the event the Commitment Letters are not delivered on or before December 22, 2006, the Agent or its special counsel, on behalf of the Banks, may engage a financial advisor, and the Company shall acknowledge and agree to such engagement (as amended, restated or otherwise modified from time to time, the "Financial Advisor Engagement Agreement") satisfactory in form and substance to the Banks and their special counsel and the Company shall pay all fees and expenses payable under such Financial Advisor Engagement Agreement. After such engagement, the Company shall comply with each of the terms and conditions of the Financial Advisor Engagement Agreement. 8 6.2. If either (i) the condition set forth in Section 1.2(b)(i) of this Agreement is not met, or (ii) the event set forth in clause (x) of the first proviso to Section 1.2(b) of this Agreement occurs, the Company shall pay, and there shall become due and payable, on the next Business Day following the first to occur of the events set forth in the foregoing clause (i) or clause (ii), a fee to each Bank in an amount equal to 15 basis points, calculated on such Bank's Commitment (which fee shall be paid by wire transfer of immediately available funds); such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Agreement is thereafter terminated or rescinded for any reason. 6.3. The Company will not, and will not permit any of its Subsidiaries or Affiliates to, pay or agree to pay any fees or other consideration, or given any additional security or collateral, or shorten the maturity or average life of any indebtedness or permanently reduce any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company (or any agent of any creditor or group of creditors) without the prior written consent of the Required Banks (other than (i) a fee payable to the holders of the Senior Unsecured Notes on substantially identical terms to those set forth in Section 6.2 above with respect to the fee payable to the Banks under such Section, (ii) any reduction of the facility available under the Securitization Documents and (iii) a waiver fee payable to the Securitization Lenders under Section 4 of the New Securitization Waiver). 6.4. The Company will not permit any Primary Loan Document (other than the Credit Agreement) to be amended, waived or otherwise modified after the date hereof without the prior written consent of the Required Banks. 6.5 The Company covenants and agrees that it shall close the credit facilities which are the subject of the Commitment Letters on or before February 15, 2007 and it shall make a drawing under such credit facilities on or before February 15, 2007 for the purpose of repaying all amounts outstanding under the Credit Agreement. The failure of the Company to comply with any of the covenants set forth in this Section 6 shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 6.1(d) of the Credit Agreement. SECTION 7. 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 8. 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 9 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 February 15, 2007. 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 9. Miscellaneous. 9.1 Within 10 Business Days after the 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. 9.2 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. 9.3 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. 9.4 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. 9.5 This Agreement 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. 10 9.6 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. 9.7 This Agreement 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] 11 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 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 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/Thomas Randolph Thomas Randolph Title: Managing Director By: /s/Doug Weir Doug Weir Title: Vice President HARRIS N.A. By: /s/ Todd M. Kosteinik Todd M. Kosteinik Its: Vice President 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 COOPERATIEVE CENTRALE RAIFFEISEN- BOERENLEENBANK B.A. "RABOBANK INTERNATIONAL", NEW YORK BRANCH By: Its: EXHIBIT A Form of New NPA Waiver (To be conformed for each of the Note Purchase Agreements) EXHIBIT B Form of New Securitization Waiver EX-10 5 exhibit4.txt 10.4 Exhibit 10.4 SECOND OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMANCE UNDERTAKING THIS SECOND OMNIBUS WAIVER, AMENDMENT AND REAFFIRMATION OF PERFORMANCE UNDERTAKING, dated as of December 15, 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); WHEREAS, the parties entered into an Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking dated as of November 14, 2006 (the "Existing Waiver") pursuant to which the Agent and the Purchasers, among other things, waived a Termination Event and Amortization Event through and including the date hereof; WHEREAS, the Companies have asked the Agent and the Purchasers to extend the waivers granted pursuant to the Existing Waiver through January 31, 2007 (as the same may be extended in accordance with the terms hereof, the "Outside Waiver Termination Date"); WHEREAS, the parties wish to (a) extend the waivers granted under the Existing Waiver through the Outside Waiver Termination Date, (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; and WHEREAS, simultaneously herewith, Invacare and various noteholders are entering into a Second Waiver and Amendment, dated as of December 15, 2006 (the "Noteholder Waiver") to the separate and several Note Purchase Agreements dated as of April 27, 2006, and a First Amendment to Waiver and Amendment Agreement, dated as of December 15, 2006 with respect to their certain Credit Agreement dated as of January 14, 2005 (the "Bank Waiver" and, together with the Noteholder Waiver, the "Other December 2006 Waivers"); 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: 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; Amendments. 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 the Outside Waiver Termination Date arise) under: (i) Section 5.1(c) of the Receivables Sale Agreement by virtue of Invacare's failure to observe Sections 5.2(a), 5.2(c), 6.1(c) and 6.1(f) of the Five-Year Credit Agreement and/or Sections 7.1(d), 11.3 and 12 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, (ii) Section 5.1(a)(ii) of the Receivables Sale Agreement by virtue of Invacare's failure to observe Section 4.1(b)(i) of the Receivables Sale Agreement, and (iii) Section 9.1(a)(ii) of the Receivables Purchase Agreement by virtue of Invacare's failure to observe Section 7.1(b)(v) of the Receivables Purchase Agreement (all of the foregoing, collectively, the "Existing Defaults") is hereby waived for the period commencing on the date hereof through the earliest to occur of (A) the Outside Waiver Termination Date, (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. 2 (b) Any Amortization Event or Potential Amortization Event that may have arisen (or that may at any time hereafter prior to the Outside Waiver Termination Date arise) under Section 9.1(c) of the Receivables Purchase Agreement by virtue of the Existing Defaults is hereby waived for the period commencing on the date hereof through the earliest to occur of (i) the Outside Waiver Termination Date, (B) any Potential Amortization Event or Amortization Event other than the Existing 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. (c) The Outside Waiver Termination Date shall be automatically extended from January 31, 2007 to February 15, 2007, without notice or any other action, if (i) on or prior to December 22, 2006, Invacare has provided the Agent with a fully executed commitment letter or letters (as amended or otherwise modified from time to time, collectively, the "Commitment Letters") providing fully underwritten commitments from one or more reputable financial institutions and/or institutional investors to provide financing to Invacare in an aggregate amount sufficient to pay in full all outstanding obligations of Invacare and its Subsidiaries under the Primary Loan Documents (as defined in the Noteholder Waiver) on or prior to February 15, 2007, in form and substance satisfactory to the Agent and (ii) the waiver period under each of the Other December 2006 Waivers has likewise been (or shall be, concurrently with the extension of this Waiver) extended to February 15, 2007 on terms and conditions satisfactory to the Agent; provided, however if on or prior to January 31, 2007, (x) any of the Commitment Letters is terminated (unless the commitments under the remaining Commitment Letters, after giving effect to such termination and any new Commitment Letter or Commitment Letters entered into by Invacare in replacement of such terminated Commitment Letter and delivered to the Agent prior to such termination, are sufficient to pay in full all outstanding obligations of Invacare and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007) or (y) the waiver period under any of the Other December 2006 Waivers shall have reverted to January 31, 2007 then, in any such case, the Outside Waiver Termination Date shall revert to January 31, 2007; provided, further that if any of the events described in the foregoing clauses (x) or (y) occurs after January 31, 2007, the waivers contained herein shall expire as of the occurrence of such event without notice or any further action. 2.2. Amendments. (a) Section 6.2(a) of the Receivables Purchase Agreement is hereby amended to insert ", Weekly Report" after the term "Monthly Report". (b) Section 8.5 of the Receivables Purchase Agreement is hereby amended and restated in its entirety to read as follows: 3 Section 8.5. Reports. The Servicer shall prepare and forward to the Agent (i) on the 12th Business Day of each month, a Monthly Report, (ii) on Wednesday of each week commencing on or after December 17, 2006 (or if any such Wednesday is not a Business Day, on the next succeeding Business Day thereafter, a Weekly Report as of the last Business Day of the week then most recently ended, (iii) from and after the occurrence of an Amortization Event, at such times as Agent shall request, an interim report in form reasonably acceptable to the Agent showing the amount of Eligible Receivables, and (iv) at such times as the Agent shall reasonably request, a listing by Obligor of all Receivables together with an aging of such Receivables. (c) A new Exhibit XI is hereby added to the Receivables Purchase Agreement which reads in the form of Annex A to this Waiver. (d) The following new definitions are hereby added to Exhibit I of the Receivables Purchase Agreement in their appropriate alphabetical order: "DLL Discount Factor" means, on any date of determination, 25% of the aggregate Outstanding Balance of "IVC & ICCG lease invoices" as reported on the most recent Monthly Report. "Weekly Report" means a report, in substantially the form of Exhibit XI hereto (appropriately completed), furnished by the Servicer to the Agent pursuant to clause (ii) of Section 8.5. (e) The definitions of the following terms in the Receivables Purchase Agreement are hereby amended and restated in their entirety to read as follows: "Aggregate Reserves" means, on any date of determination, 38% of the Net Receivables Balance. "Designated Obligor" means (a) Mobility Products Unlimited, and (b) any other Obligor designated in writing by the Agent, in the exercise of reasonable credit judgment, as being unacceptable to it. "Liquidity Termination Date" means the Outside Waiver Termination Date or such later date as extended pursuant to the terms of this Agreement. "Monthly Report" means a report, in substantially the form of Exhibit IX hereto (appropriately completed), furnished by the Servicer to the Agent pursuant to clause (i) of Section 8.5. "Net Eligible Receivable" means the total Eligible Receivables minus the Cash Discount Factor and minus the DLL Discount Factor. "Outside Waiver Termination Date" has the meaning specified in that certain Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of December 15, 2006 by and among the parties hereto. 4 3. Certain Representations. In order to induce the Agent and the Purchasers to enter into this Waiver, each of the Companies hereby represents and warrants to the Agent and the Purchasers that, after giving effect to the waivers contained in Section 2 hereof, (a) no Termination Event, Potential Termination Event, Amortization Event or Potential Amortization Event exists and is continuing as of the Effective Date (as defined in Section 4 below), (b) each of the Agreements to which such Company is a party, as amended hereby, constitutes the legal, valid and binding obligations of such Company enforceable against such Company in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws relating to or limiting creditors' rights generally and by general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law and (c) each of such Company's representations and warranties contained in each of the Agreements to which it is a party is true and correct as of the Effective Date as though made on such date (except for such representations and warranties that speak only as of an earlier date). 4. Effective Date; Conditions Precedent. This Waiver shall become effective as of the date hereof (the "Effective Date") upon receipt by the Agent of (a) counterparts of this Waiver, duly executed by each of the parties hereto, (b) a copy of each of the Other December 2006 Waivers executed by the parties thereto, on terms and conditions acceptable to the Agent, (c) payment in immediately available funds of $6,927.20 in outstanding legal fees and disbursements of the Agent's counsel as of November 30, 2006, (d) counterparts of an amended and restated Fee Letter, duly executed by the Agent, the Conduit, IRC and J.P. Morgan Securities Inc., and (e) payment of a fully-earned and non-refundable Waiver Fee (as defined in the Fee Letter) in immediately available funds. 5. Ratification; Reaffirmation of Performance Undertaking. Except as expressly modified hereby, the Agreements, as amended hereby, is hereby ratified, approved and confirmed in all respects. By its signature below, Invacare hereby consents to the terms of this Waiver and hereby confirms that its Performance Undertaking remains unaltered and in full force and effect. 6. Reference to Agreement. From and after the Effective Date hereof, each reference in the Agreements to "this Agreement", "hereof", or "hereunder" or words of like import, and all references to the Agreements in any and all agreements, instruments, documents, notes, certificates and other writings of every kind and nature shall be deemed to mean the Agreements in each case, as modified by this Waiver. 7. Costs and Expenses. The Seller agrees to pay all reasonable costs, fees, and out-of-pocket expenses (including reasonable attorneys' fees and time charges of attorneys for the Agent) incurred by the Agent in connection with the preparation, execution and enforcement of this Waiver. 8. CHOICE OF LAW. THIS WAIVER SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF NEW YORK. 5 9. Execution in Counterparts. This Waiver may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. IN WITNESS WHEREOF, the parties have executed this Waiver as of the date first above written. PARK AVENUE RECEIVABLES COMPANY, LLC BY: JPMORGAN CHASE BANK, N.A., ITS ATTORNEY-IN-FACT By: /s/ Ronald J. Atkins Name: Ronald J. Atkins Title: Authorized Signatory JPMORGAN CHASE BANK, N.A., INDIVIDUALLY AND AS AGENT By: /s/ Ronald J. Atkins Name: Ronald J. Atkins Title: Vice President INVACARE CORPORATION, HEALTHTECH PRODUCTS, INC. AND INVACARE SUPPLY GROUP, INC. By: /s/ Gregory C. Thompson Name: Gregory C. Thompson Title: Chief Financial Officer INVACARE RECEIVABLES CORPORATION By: /s/ Gregory C. Thompson Name: Gregory C. Thompson Title: Chief Financial Officer Annex A EXHIBIT XI FORM OF WEEKLY REPORT [GRAPHIC OMITTED] EX-10 6 exhibit5.txt 10.5 Exhibit 10.5 ================================================================================ INVACARE CORPORATION ----------------------------------- SECOND WAIVER AND AMENDMENT Dated as of December 15, 2006 to NOTE PURCHASE AGREEMENTS Dated as of April 27, 2006 ----------------------------------- Re: $150,000,000 6.15% Senior Notes due April 27, 2016 ================================================================================ SECOND WAIVER AND AMENDMENT TO NOTE PURCHASE AGREEMENTS THIS SECOND WAIVER AND AMENDMENT, dated as of December 15, 2006 (this "Waiver and Amendment") to the separate and several Note Purchase Agreements dated as of April 27, 2006, is between INVACARE CORPORATION, an Ohio corporation (the "Company"), and each of the institutions which is a signatory to this Waiver and is a Noteholder referred to below. RECITALS: A. The Company has previously entered into separate and several Note Purchase Agreements, each dated as of April 27, 2006, between the Company and each of the institutions identified on Schedule A thereto (together with their successors and assigns, each a "Noteholder," and, collectively, the "Noteholders"), as amended by that certain Waiver and Amendment, dated as of November 14, 2006 (as amended, restated or otherwise modified, the "Existing NPA Waiver"), to Note Purchase Agreements dated as of April 27, 2006 (as amended, restated or otherwise modified from time to time, collectively, the "Note Purchase Agreement"), , pursuant to which the Company issued and sold its $150,000,000 6.15% Senior Notes due April 27, 2016 (as amended, restated, supplemented, replaced or otherwise modified hereby or from time to time, collectively, the "Notes"). The Noteholders are the holders of all of the outstanding principal amount of the Notes. B. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of February 27, 1998, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of October 1, 2003, to Note Purchase Agreements dated as of February 27, 1998, that certain Second Amendment, dated as of September 29, 2005, to Note Purchase Agreements dated as of February 27, 1998, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of February 27, 1998 (as amended, restated or otherwise modified from time to time, the "Existing 1998 NPA Waiver"), and that certain Second Waiver and Amendment, dated as of the date hereof, to Note Purchase Agreements dated as of February 27, 1998 (as amended, restated or otherwise modified from time to time, the "New 1998 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "1998 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $80,000,000 6.71% Series A Senior Notes due February 27, 2008 (as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "1998 Notes") and (ii) $20,000,000 6.60% Series B Senior Notes due February 27, 2005 (which Series B Notes have since been paid in full by the Company). C. The Company has also previously entered into separate and several Note Purchase Agreements, each dated as of October 1, 2003, between the Company and each of the institutions identified on Schedule A thereto, as amended by that certain First Amendment, dated as of September 29, 2005, to Note Purchase Agreement dated as of October 1, 2003, that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of October 1, 2003 (as amended, restated or otherwise modified from time to time, the "Existing 2003 NPA Waiver"), and that certain Second Waiver and Amendment, dated as of the date hereof, to Note Purchase Agreements dated as of October 1, 2003 ,(as amended, restated or otherwise modified from time to time, the "New 2003 NPA Waiver") (such Note Purchase Agreements, as amended, restated or otherwise modified from time to time, collectively, the "2003 Note Purchase Agreement"), pursuant to which the Company issued and sold to the purchasers named on Schedule A thereto its (i) $50,000,000 3.97% Series A Senior Notes due October 1, 2007, (ii) $30,000,000 4.74% Series B Senior Notes due October 1, 2009, and (iii) $20,000,000 5.05% Series C Senior Notes due October 1, 2010 (all of such notes, as amended, restated, supplemented, replaced or otherwise modified from time to time, collectively, the "2003 Notes"). D. The Company has also previously entered into that certain Credit Agreement dated as of January 14, 2005, among the Company, the Borrowing Subsidiaries (as defined therein), JPMorgan Chase Bank, N.A., as agent (the "Agent"), and the other bank lenders party thereto (the "Banks"), as amended by that certain Letter Agreement, dated as of March 31, 2005, that certain First Amendment to Credit Agreement, dated as of August 12, 2005, that certain Second Amendment to Credit Agreement, dated as of March 31, 2006, that certain Waiver and Amendment Agreement, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Bank Waiver"), and that certain Second Waiver and Amendment Agreement (as amended, restated or otherwise modified from time to time, the "New Bank Waiver"), dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "Bank Credit Agreement"). E. The Company is also a party to (i) that certain Receivables Purchase Agreement, dated as of September 30, 2005, among the Company, as Servicer, Invacare Receivables Corporation, as Seller, Park Avenue Receivables Company, LLC and JPMorgan Chase Bank, N.A., as Agent, and the purchasers named on Schedule A thereto (the "Securitization Lenders") as amended by that certain Amendment No. 1 to Receivables Purchase Agreement, dated as of September 28, 2006 and that certain Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of November 14, 2006 (as amended, restated or otherwise modified from time to time, the "Existing Securitization Waiver"), and that certain Second Omnibus Waiver, Amendment and Reaffirmation of Performance Undertaking, dated as of the date hereof (as amended, restated or otherwise modified from time to time, the "New Securitization Waiver", and together with the New 1998 NPA Waiver, the New 2003 NPA Waiver and the New Bank Waiver, the "Other December 2006 Waivers") (such Receivables Purchase Agreement, as amended, restated or otherwise modified from time to time, the "Securitization Purchase Agreement"), (ii) that certain Receivables Sale Agreement, dated as of September 30, 2005, among the Company, Invacare Receivables Corporation, Healthtech Products, Inc. and Invacare Supply Group, Inc. as amended by the Existing Securitization Waiver and the New Securitization Waiver (as amended, restated or otherwise modified from time to time, the "Securitization Sale Agreement") and (iii) that certain Performance Undertaking, dated as of September 30, 2005, in favor of Invacare Receivables Corporation (as amended, restated or otherwise modified from time to time, the "Performance Undertaking", and together with the Securitization Sale Agreement and the Securitization Purchase Agreement, the "Securitization Documents", and the Securitization Documents, together with the 1998 Note Purchase Agreement, the 2003 Note Purchase Agreement and the Bank Credit Agreement, collectively, the "Other Primary Loan Agreements", and the Other Primary Loan Agreements, together with the Note Purchase Agreement, 2 collectively, the "Primary Loan Agreements" and the Primary Loan Agreements, together with the other agreements, documents and instruments entered into in connection therewith or pursuant thereto, collectively, the "Primary Loan Documents"). F. Pursuant to (i) the Existing NPA Waiver, the Noteholders have agreed to waive, through December 15, 2006 (subject to the terms and conditions thereof) certain Defaults and Events of Default that otherwise would exist and be continuing under the Note Purchase Agreements and which are set forth on Schedule A attached hereto (collectively, the "Existing Defaults"), (ii) the Existing 1998 NPA Waiver, the holders of the 1998 Notes (the "1998 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 1998 Note Purchase Agreement, (iii) the Existing 2003 NPA Waiver, the holders of the 2003 Notes (the "2003 Noteholders") have agreed to waive, through December 15, 2006, certain defaults and events of default under the 2003 Note Purchase Agreement, (iv) the Existing Bank Waiver, the Banks have agreed to waive, through December 15, 2006, certain defaults and events of default under the Bank Credit Agreement and (v) the Existing Securitization Waiver, the Securitization Lenders have agreed to waive, through December 15, 2006, certain "Termination Events" and "Potential Termination Events" under (and as defined in) the Securitization Sale Agreement and certain "Amortization Events" and "Potential Amortization Events" under (and as defined in) the Securitization Purchase Agreement (all of such events, the "Existing Securitization Defaults" and together with any other such events from time to time existing under such documents, the "Securitization Defaults"). G. The Company has requested that the Noteholders agree to extend the waivers of the Existing Defaults under the Note Purchase Agreement, and the Noteholders are agreeable to such request, solely on the terms and conditions set forth herein, including, without limitation, the amendments described in Section 2 hereof. H. The Company has likewise requested that (i) the 1998 Noteholders agree to extend the waivers of the defaults and events of default under the 1998 Note Purchase Agreement pursuant to the terms of the New 1998 NPA Waiver, (ii) the 2003 Noteholders agree to extend the waivers of the defaults and events of default under the 2003 Note Purchase Agreement pursuant to the terms of the New 2003 NPA Waiver, (iii) the Banks agree to extend the waivers of the defaults and events of default under the Bank Credit Agreement (and waive any new defaults or events of default thereunder) pursuant to the terms of the New Bank Waiver and (iv) the Securitization Lenders agree to extend the waivers of the Existing Securitization Defaults under the Securitization Documents pursuant to the terms of the New Securitization Waiver. I. All requirements of law have been fully complied with and all other acts and things necessary to make this Waiver and Amendment a valid, legal, and binding instrument according to its terms for the purposes herein expressed have been done or performed. NOW, THEREFORE, upon the full and complete satisfaction of the conditions precedent to the effectiveness of this Waiver and Amendment set forth in Section 3 4 hereof, and in consideration of good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the Company and the undersigned Noteholders do hereby agree as follows: SECTION 1. TEMPORARY WAIVER. (a) The Company acknowledges and agrees that, as a result of the Existing Defaults under the Note Purchase Agreement, the Noteholders may, on or after December 15, 2006, if they so elect, proceed to enforce their respective rights and remedies under the Note Purchase Agreement to collect the Company's obligations thereunder. (b) Subject to the terms and conditions of this Waiver and Amendment, the Noteholders hereby agree to temporarily waive (collectively, the "Waivers") the Existing Defaults during the period (the "Waiver Period") commencing on the Effective Date and expiring on the earliest to occur of (i) January 31, 2007, unless such date has been automatically extended to February 15, 2007 as provided in Section 1(c) below (the "Outside Waiver Termination Date"), (ii) any Default or Event of Default under the Note Purchase Agreement (including, without limitation, any Default or Event of Default arising out of a failure to comply with any term, covenant or condition of the Existing NPA Waiver, including Section 5 thereof as amended hereby), (iii) the breach or nonperformance by the Company or any Subsidiary of any covenant, agreement or condition set forth in this Waiver and Amendment or the Other December 2006 Waivers, (iv) any breach of, default, event of default or Securitization Default under any Other Primary Loan Agreement (or any amendment or waiver with respect thereto) or any termination or other expiration of the waiver period set forth in the Other December 2006 Waivers, and (v) the date on which any representation or warranty in Section 3 hereof fails to be true and correct. (c) The Outside Waiver Termination Date shall be automatically extended from January 31, 2007 to February 15, 2007, without notice or any other action, if (i) on or prior to December 22, 2006, the Company has provided each of the Noteholders with a fully executed commitment letter or letters (as amended or otherwise modified from time to time, collectively, the "Commitment Letters") providing fully underwritten commitments from one or more reputable financial institutions and/or institutional investors to provide financing to the Company in an aggregate amount sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007, in form and substance satisfactory to the Required Holders and (ii) the waiver period under each of the Other December 2006 Waivers has likewise been (or shall be, concurrently with the extension of the Waiver Period) extended to February 15, 2007 on terms and conditions satisfactory to the Required Holders; provided, however if on or prior to January 31, 2007, (x) any of the Commitment Letters is terminated (unless the commitments under the remaining Commitment Letters, after giving effect to such termination and any new Commitment Letter or Commitment Letters entered into by the Company in replacement of such terminated Commitment Letter and delivered to each of the Noteholders prior to such termination, are sufficient to pay in full all outstanding obligations of the Company and its Subsidiaries under the Primary Loan Documents on or prior to February 15, 2007) or (y) the waiver period under any of the Other December 2006 Waivers shall have reverted to January 31, 2007 then, in any such case, the Outside Waiver Termination Date shall revert to January 31, 2007; provided, further that if any of the events described in the 4 foregoing clauses (x) or (y) occurs after January 31, 2007, the Waiver Period shall expire as of the occurrence of such event without notice or any further action. (d) The waiver contemplated in this Section 1 shall be effective only for the Existing Defaults and only for the Waiver Period, and such waiver shall not entitle the Company 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 Noteholders. Such waiver shall not prejudice or constitute a waiver of any right or remedies which any Noteholder may have or be entitled to with respect to any other breach of any provision of any of the Note Purchase Agreement or the Notes. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement and Notes 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, an Event of Default will continue to exist under the Note Purchase Agreement, and the Noteholders may, 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 Note Purchase Agreement), accelerate the payment in full of the obligations owed to the Noteholders under the Note Purchase Agreement and Notes, and enforce and exercise any or all of the Noteholders' rights under or in respect of the Note Purchase Agreement and the Notes and under applicable law. (e) For avoidance of doubt, it is hereby acknowledged and agreed to by the Company that the addition of the agreements and covenants in Section 5 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 Noteholders, and the Noteholders shall retain all their rights and remedies under or in respect of the Note Purchase Agreement and Notes and under applicable law with respect to the Existing Defaults upon the expiration or termination of the Waiver Period. SECTION 2. AMENDMENTS. Section 2.1. Amendment and Restatement of the Notes. (a) Amendment and Restatement. Each Note is hereby, without any further action required on the part of any Person, deemed to be automatically amended to conform to and have the terms provided in Exhibit 2.1(a) to this Agreement (except that the principal amount and the payee of each such Note shall remain unchanged). Any Note issued on or after the Effective Date shall be in the form of Exhibit 2.1(a) to this Waiver and Amendment. (b) Replacement Notes. Upon the request of any Noteholder, the Company will issue a replacement Note or Notes (consistent with the terms hereof) in favor of such Noteholder in the appropriate form in exchange for the Note or Notes of such Noteholder delivered to the Company at the time of such exchange. Section 2.2. Amendments of Existing NPA Waiver. 5 (a) Section 5 of the Existing NPA Waiver is hereby amended by deleting the phrase "and continuing through April 15, 2007" in the third and fourth lines thereof. (b) Section 5(b) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(b) the Company will not, and will not permit any of its Subsidiaries to, at any time, directly or indirectly (i) create, incur, assume, guarantee, or otherwise become liable in respect of (A) any Debt of the Company other than Debt incurred under the Credit Agreement, (B) any Debt of Subsidiaries other than Debt incurred under the Credit Agreement by Subsidiaries that are party to the Credit Agreement as of December 15, 2006 and (C) any Securitization except that one or more Special Purpose Subsidiaries that are party to the Securitization Documents as of December 15, 2006 may become liable in respect of a Permitted Receivables Securitization Program not exceeding $75,401,750 (not including obligations in respect of fees, expenses, indemnities and other reimbursement obligations permitted under such Permitted Receivables Securitization Program) in the aggregate at any time and (ii) create, incur, assume or suffer to exist, any Lien securing any Debt of the Company or any Subsidiary or any Lien created, incurred, assumed or otherwise existing with respect to any Securitization, except Liens incurred on receivables, related assets and collections of the Company or any Subsidiary in connection with such assets being transferred to a Special Purpose Subsidiary pursuant to a Permitted Receivables Securitization Program as permitted in accordance with Section 5(f) of this Waiver; as used in this Section 5(b), "Securitization" means one or more transactions wherein the Company and/or a Subsidiary transfers receivables, related assets and collections of the Company and/or such Subsidiary to a special purpose Subsidiary which issues or incurs indebtedness secured by such receivables and all of its other assets;" (c) Section 5(i) of the Existing NPA Waiver is hereby amended and restated in its entirety to read as follows: "(i) the Company will not, and will not permit any Subsidiary to, (x) enter into any agreement restricting the ability of the Company and its Subsidiaries to amend or modify the Note Purchase Agreement or Notes or any document or instrument executed in connection therewith, except as set forth in the waiver/amendment to the Bank Credit Agreement referred to in Section 3(c) hereof or (y) enter into any agreement or arrangement requiring any defeasance of the Bank Credit Agreement; and" SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. To induce the Noteholders to execute and deliver this Waiver and Amendment (which representations shall survive the execution and delivery of this Waiver and Amendment), the Company represents and warrants to the Noteholders that: 6 (a) this Waiver and Amendment has been duly authorized, executed and delivered by it and this Waiver and Amendment constitutes the legal, valid and binding obligation, contract and agreement of the Company enforceable against it 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 Note Purchase Agreement, as modified by this Waiver and Amendment, constitutes the legal, valid, and binding obligations, contracts, and agreements of the Company 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, delivery and performance by the Company of this Waiver and Amendment (i) has been duly authorized by all requisite corporate action and, if required, shareholder action, (ii) does not require the consent or approval of any governmental or regulatory body or agency, and (iii) does not and will not (A) violate (1) any provision of law, statute, rule or regulation or its certificate of incorporation or bylaws, (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 referred to in clause (iii)(A)(3) of this Section 3(c) or (C) result in the creation of any Lien; (d) as of the date hereof and after giving effect to this Waiver and Amendment and the Other December 2006 Waivers, (i) no Default or Event of Default has occurred which is continuing under the Note Purchase Agreement, (ii) no default, event of default, Securitization Default or similar event has occurred and is continuing under any Other Primary Loan Agreement; and (e) all the representations and warranties made by the Company in the Note Purchase Agreement 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; (f) neither the Company nor any of its Affiliates has paid or agreed to pay any fees or other consideration, or given any additional security or collateral, or shortened the maturity or average life of any indebtedness or permanently reduced any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company, in connection with the obtaining of any consents or approvals in connection with the transactions contemplated hereby (including, without limitation, under the Other Primary Loan Agreements), other than (i) with respect to the Notes, the payment of the waiver fees referred to in Section 4(b)(i) below and the additional fee payable in accordance with Section 5.2 below, (ii) with respect to the 1998 Notes, a waiver fee equal to 0.10% of the 7 aggregate outstanding principal amount of the 1998 Notes paid pro rata to the 1998 Noteholders, (iii) with respect to the 2003 Notes, a waiver fee equal to 0.10% of the aggregate outstanding principal amount of the 2003 Notes paid pro rata to the 2003 Noteholders, (iv) with respect to the Bank Credit Agreement, a waiver fee equal to 0.10% of the aggregate commitments of the Banks, (v) the waiver fee payable to the Securitization Lenders under Section 4 of the New Securitization Waiver and (vi) with respect to the 1998 Notes, the 2003 Notes and the Bank Credit Agreement, a fee payable to the Banks, the 1998 Noteholders and the 2003 Noteholders, respectively, on substantially identical terms to those set forth in Section 5.2 below with respect to the fee payable to the holders of Notes under such Section; (g) the amount of Consolidated Debt of the Company and its Subsidiaries (as defined in and as calculated under the Note Purchase Agreement) as of December 15, 2006, is $500,762,618, as described in further detail on Schedule B hereto; (h) the amount of all Revolving Credit Advances (as defined in the Bank Credit Agreement) outstanding under the Bank Credit Agreement as of December 15, 2006 is $157,893,617, consisting of $117,254,840 in Revolving Credit Advances made to Subsidiaries and $40,638,778 in Revolving Credit Advances made to the Company; and as of December 15, 2006, there are no Bid-Option Loans (as defined in the Bank Credit Agreement) outstanding; (i) on December 15, 2006, the Company and its Subsidiaries have the right to obtain Advances (as defined in the Credit Agreement) of $20,000,000 under the Credit Agreement; (j) except as set forth and described in the Recitals hereto, the Company has not entered into any amendment or waiver or entered into any agreement having the effect of an amendment or waiver with respect to any provision of any of the Primary Loan Documents; and (k) 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. SECTION 4. CONDITIONS TO EFFECTIVENESS; POST-CLOSING COVENANTS. (a) The Waivers shall not become effective until, and shall become effective when, each and every one of the following conditions shall have been satisfied (the "Effective Date"): (i) executed counterparts of this Waiver and Amendment, duly executed by the Company and the Required Holders, shall have been delivered to the Noteholders; (ii) the representations and warranties of the Company set forth in Section 3 hereof are true and correct on and with respect to the date hereof and (except to the extent that any of such representations and warranties expressly relate by their terms to a prior date) the Effective Date; 8 (iii) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Bank Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing Bank Waiver, together with any other defaults or events of default that have occurred and are continuing, for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder), and on the Effective Date, after giving effect to the New Bank Waiver, (i) the Company and its Subsidiaries have the right to obtain Advances of not less than $20,000,000 under the Credit Agreement and (ii) the "Termination Date" under the Credit Agreement shall not be on a date prior to January 14, 2010; (iv) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 1998 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 1998 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (v) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New 2003 NPA Waiver which shall provide for any amendment, modification, waiver, or consent necessary to waive the defaults or events of default waived under the Existing 2003 NPA Waiver for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vi) the Company shall have furnished to the Noteholders and their special counsel an executed copy of the New Securitization Waiver which shall provide for an amendment, modification, waiver, or consent necessary to waive the Existing Securitization Defaults for the Waiver Period, and any such amendment, modification, waiver, or consent shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel (including, without limitation, with respect to any waiver thereunder not expiring before the end of the Waiver Period hereunder); (vii) the Company shall have acknowledged and agreed to an engagement agreement between Bingham McCutchen LLP (on behalf of the Noteholders) and FTI Consulting, Inc. (as amended, restated or otherwise modified from time to time, the "Financial Advisor Engagement Agreement") satisfactory in form and substance to the Noteholders and their special counsel; 9 (viii) the Company shall have acknowledged and agreed to an engagement agreement among the Noteholders and Bingham McCutchen LLP (as amended, restated or otherwise modified from time to time, the "Bingham Engagement Agreement", and together with the Financial Advisor Engagement Agreement, the "Engagement Agreements") satisfactory in form and substance to the Noteholders and their special counsel; (ix) the Noteholders shall have received a copy of the resolutions of the Board of Directors of the Company authorizing the execution, delivery, and performance by the Company of this Waiver and Amendment, certified by its Secretary or an Assistant Secretary, together with documentation evidencing all other proceedings taken in connection with the transactions contemplated by this Waiver and Amendment, and all documents necessary to the consummation thereof, in each case, which shall be reasonably satisfactory in form and substance to the Noteholders and their special counsel; (x) the Noteholders shall have received such lien searches with respect to the Company as are reasonably required by the Noteholders or their special counsel; and (xi) a statement of the Company's and its Subsidiaries' cash balances as of the close of business on Friday, December 15, 2006, certified as true and correct by a Senior Financial Officer. (b) The Company shall, on or prior to December 18, 2006: (i) pay to each Noteholder, by wire transfer of immediately availably funds, a waiver fee, whether or not such holder has signed this Waiver and Amendment, in an amount equal to 0.10% of the aggregate outstanding principal amount of the Notes held by such Noteholder; such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is terminated or rescinded for any reason; (ii) pay the reasonable fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP, and the Noteholder's financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby, and any fees and expenses of Chapman and Cutler LLP in connection with the negotiation, preparation, execution and delivery of the Existing NPA Waivers that have not yet been paid; the payment of the fees and disbursements pursuant to this Section 4(b)(ii) does not preclude the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 6 of this Waiver and Amendment or Section 16 of the Note Purchase Agreement; and (iii) pay the fee reserves payable to the Bingham McCutchen LLP and FTI Consulting, Inc. under the terms of their respective Engagement Letters. 10 The failure of the Company to comply with any of the covenants set forth in this Section 4(b) shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 5. COVENANTS. In addition to and without limiting the Company's obligations under the Note Purchase Agreement, the Company covenants and agrees that at all times from and after the date hereof: Section 5.1. Compliance with Financial Advisor Engagement Agreement. The Company shall comply with each of the terms and conditions of the Financial Advisor Engagement Agreement. Section 5.2. Fee Upon Failure to Deliver (or Termination of) Commitment Letters. If either (i) the condition set forth in Section 1(c)(i) of this Waiver and Amendment is not met or (ii) the event set forth in clause (x) of the first proviso to Section 1(c)(i) of this Waiver and Amendment occurs, the Company shall pay, and there shall become due and payable, on the next Business Day following the first to occur of the events set forth in the foregoing clause (i) or clause (ii), a fee to each Noteholder in an amount equal to 0.15% of the aggregate outstanding principal amount of the Notes then held by such Noteholder (which fee shall be paid by wire transfer of immediately available funds); such fee shall be deemed earned when paid and shall not be subject to recovery or repayment in the event this Waiver and Amendment is thereafter terminated or rescinded for any reason. Section 5.3. Payment of Additional Fees or Compensation to Creditors. The Company will not, and will not permit any of its Subsidiaries or Affiliates to, pay or agree to pay any fees or other consideration, or give any additional security or collateral, or shorten the maturity or average life of any indebtedness or permanently reduce any borrowing capacity, in each case, in favor of or for the benefit for any creditor of the Company (or any agent of any creditor or group of creditors) without the prior written consent of the Required Holders (other than a fee payable to the Banks, the 1998 Noteholders and the 2003 Noteholders on substantially identical terms to those set forth in Section 5.2 above with respect to the fee payable to the Noteholders under such Section). Section 5.4. Amendments to Primary Loan Documents. The Company will not permit any Primary Loan Document or any amendment or waiver of any Primary Loan Document (in each case, other than the Note Purchase Agreement and the Notes), to be amended, waived or otherwise modified after the date hereof without the prior written consent of the Required Holders. Section 5.5. Closing of New Credit Facilities; Prepayment. The Company covenants and agrees that it shall close the credit facilities which are the subject of the Commitment Letters on or before February 15, 2007 and it shall make a drawing under such credit facilities on or before February 15, 2007 for the purpose of prepaying all amounts owing under the Note Purchase Agreement. Any such prepayment shall be deemed to be an optional prepayment of the Company's obligations under the Note Purchase Agreement and the Notes in 11 accordance with Section 8.2 of the Note Purchase Agreement, and the Noteholders waive the requirement of prior written notice of prepayment thereunder in connection with such prepayment. The failure of the Company to comply with any of the covenants set forth in this Section 5 shall constitute, and shall be deemed to constitute, an immediate Event of Default under Section 12(c) of the Note Purchase Agreement. SECTION 6. FEES AND EXPENSES. The Company shall pay the fees and disbursements of the Noteholders' special counsel, Bingham McCutchen LLP and the Noteholders' financial advisor, FTI Consulting, Inc., incurred in connection with the negotiation, preparation, execution and delivery of this Waiver and Amendment and the transactions contemplated hereby in accordance with the terms of the Engagement Letters. This provision shall be supplementary to, and shall not in any way be deemed to limit, the Noteholders' rights to indemnification and reimbursement for other costs and expenses as provided in Section 16 of the Note Purchase Agreement. SECTION 7. RELEASE. In order to induce the Noteholders to enter into this Waiver and Amendment, the Company acknowledges and agrees that: (a) neither the Company nor any of its Subsidiaries has any claim or cause of action against any of the Noteholders or any of their respective directors, trustees, officers, employees or agents (collectively, the "Released Parties") relating to or arising out of the Note Purchase Agreement or Notes or any of the transactions related thereto; (b) neither the Company nor any of its 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; and (c) each of the Released Parties has heretofore properly performed and satisfied in a timely manner all of its obligations to the Company and its Subsidiaries under the Note Purchase Agreement. Notwithstanding this representation and as further consideration for the agreements and understandings herein, the Company, on behalf of itself and its employees, agents, executors, heirs, successors and assigns (the "Releasing Parties"), hereby releases the Noteholders, its respective predecessors, officers, directors, trustees, 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 Note Purchase Agreement or Notes or any of the transactions relating thereto. No Released Party shall be liable with respect to, and the Company hereby waives, releases and agrees not to sue for, any special, indirect or consequential damages relating to the Note Purchase Agreement and the Notes or arising out of its activities in connection herewith or therewith (whether before, on or after the date hereof). 12 SECTION 8. AMENDMENTS AND WAIVERS. This Waiver and Amendment may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with (and only with) the written consent of the Company and the Required Holders. SECTION 9. DEFINITIONS. Capitalized terms used herein shall have the respective meanings ascribed thereto in the Note Purchase Agreement, unless defined herein (in which case such terms shall have the meanings set forth herein) or the context shall otherwise require. SECTION 10. MISCELLANEOUS. Section 10.1. More Favorable Provisions. The Company acknowledges and agrees that any covenants, defaults or similar provisions set forth in any of the Other December 2006 Waivers not substantially provided for in this Waiver and Amendment, or any such covenants, defaults or similar provisions that are more favorable to the creditors thereunder than the covenants, defaults or similar provisions hereunder, are hereby incorporated by reference into this Waiver and Amendment 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. Section 10.2. Construction; References to Note Purchase Agreement. This Waiver and Amendment shall be construed in connection with and as part of the Note Purchase Agreement. Any and all notices, requests, certificates and other instruments executed and delivered after the execution and delivery of this Waiver and Amendment may refer to the Note Purchase Agreement without making specific reference to this Waiver and Amendment but nevertheless all such references shall include this Waiver and Amendment unless the context otherwise requires. This Waiver and Amendment shall not be construed more strictly against the Noteholders merely by virtue of the fact that the same has been prepared by the Noteholders or their counsel, it being recognized that the Company and the Noteholders have contributed substantially and materially to the preparation of this Waiver and Amendment, 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 Waiver and Amendment. Section 10.3. Ramifications of Waiver; Reaffirmation. The Company acknowledges that the waivers and amendments granted hereunder by the Noteholders shall not be construed as an agreement to amend or waive any other provision of any of the Note Purchase Agreement, and the Noteholders shall have no obligation to enter into any such amendment or waiver. Other than the Existing Defaults temporarily waived during the Waiver Period, none of the Noteholders have waived, nor are they by this Waiver and Amendment waiving, and have made no commitment to waive, any other Default or Event of Default that may occur or be continuing on the date hereof or may occur or be continuing after the date hereof. The Noteholders reserve their respective rights, in their discretion, to exercise any or all of their rights and remedies under the Note Purchase Agreement as a result of any other such Default or Event of Default. No 13 delay or omission of the Noteholders to exercise any right under the Note Purchase Agreement shall impair any such right or be construed to be a waiver of any other such Default or Event of Default or an acquiescence therein. Except as modified, waived or expressly amended by this Waiver and Amendment, all terms, conditions, and covenants contained in the Note Purchase Agreement are hereby ratified and confirmed by the Company and shall be and remain in full force and effect. Section 10.4. Affirmation of Recitals; etc. The Company hereby acknowledges and affirms the accuracy of all recitals to this Waiver and Amendment. The Company represents that neither it, nor any of its Subsidiaries, has any intention to file or acquiesce in the filing of any bankruptcy or insolvency proceeding hereafter and that the Company believes that the period of time allowed by this Waiver and Amendment is sufficient for the Company and its Subsidiaries to accomplish the transactions that they have undertaken as represented by the Company to the Noteholders. Section 10.5. Further Assurances. The Company will, and will cause each of its Subsidiaries to, execute and deliver any and all documents reasonably deemed necessary or appropriate by the Noteholders to carry out the intent of and/or to implement this Waiver and Amendment. Section 10.6. Section Headings. The descriptive headings of the various Sections or parts of this Waiver and Amendment are for convenience only and shall not affect the meaning or construction of any of the provisions hereof. Section 10.7. Governing Law. This Waiver and Amendment shall be governed by and construed and enforced in accordance with the law of the State of New York, excluding choice-of-law principles of the law of such State that would require the application of the laws of a jurisdiction other than such State. Section 10.8. Survival. The provisions of Sections 6 and 7 of this Waiver and Amendment shall survive and continue in effect following any termination, rescission or expiration of this Waiver and Amendment. Section 10.9. Time is of the Essence. TIME IS OF THE ESSENCE WITH RESPECT TO ALL COVENANTS, CONDITIONS, AGREEMENTS, OR OTHER PROVISIONS HEREIN. Section 10.10. Counterparts. This Waiver and Amendment may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page to this Waiver and Amendment by facsimile shall be effective as delivery of a manually executed counterpart of this Waiver and Amendment. [Remainder of page left intentionally blank] 14 If you are in agreement with the foregoing, please sign the form of agreement on the accompanying counterpart of this Waiver and Amendment and return it to the Company, whereupon the foregoing shall become a binding agreement between you and the Company. INVACARE CORPORATION By: /s/ Gregory C. Thompson Name: Gregory C. Thompson Title: Chief Financial Officer The foregoing is hereby agreed to as of the date thereof. METROPOLITAN LIFE INSURANCE COMPANY METLIFE INVESTORS INSURANCE COMPANY BY: METROPOLITAN LIFE INSURANCE COMPANY, ITS INVESTMENT MANAGER METLIFE LIFE AND REINSURANCE COMPANY OF SOUTH CAROLINA BY: METROPOLITAN LIFE INSURANCE COMPANY, ITS INVESTMENT MANAGER By: /s/ Judoth A. Gulotta Name: Judoth A. Gulotta Title: Director The foregoing is hereby agreed to as of the date thereof. AXA EQUITABLE LIFE INSURANCE COMPANY By: /s/ Amy Judd Name: Amy Judd Title: Investment Officer $21,000,000 J. ROMEO & CO. (as nominee for MONY Life Insurance Company) By J. ROMEO & CO. (as nominee for MONY Life Insurance Company of America) By J. ROMEO & CO. /s/ Peter Coccia Its Partner The foregoing is hereby agreed to as of the date thereof. HORIZON BLUE CROSS BLUE SHIELD OF NEW JERSEY By: AllianceBernstein LP, its Investment Adviser By: /s/ Amy Judd Name: Amy Judd Title: Senior Vice President $2,000,000 The foregoing is hereby agreed to as of the date thereof. SYMETRA LIFE INSURANCE COMPANY, a Washington corporation By: Principal Global Investors, LLC, a Delaware limited liability company, its authorized signatory By: /s/ Randy Woodbury Name: Randy Woodbury Title: Senior Analyst By: /s/ Timothy Warrick Name: Timothy Warrick Title: Portfolio Manager PRINCIPAL LIFE INSURANCE COMPANY By: Principal Global Investors, LLC, a Delaware limited liability company, its authorized signatory By: /s/ Debra Svoboda Name: Debra Svoboda Title: EPP Counsel By: /s/ Randy Woodbury Name: Randy Woodbury Title: Senior Analyst AVIVA LIFE INSURANCE COMPANY By Its VANTISLIFE INSURANCE COMPANY By: Principal Global Investors, LLC, a Delaware limited liability company, its authorized signatory By: /s/ Randy Woodbury Name: Randy Woodbury Title: Senior Analyst By: /s/ Timothy Warrick Name: Timothy Warrick Title: Portfolio Manager The foregoing is hereby agreed to as of the date thereof. THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA By: /s/ Brian Keeting Name: Brian Keeting Title: Director, Fixed Income BERKSHIRE LIFE INSURANCE COMPANY OF AMERICA By: /s/ Brian Keeting Name: Brian Keeting Title: Director, Fixed Income The foregoing is hereby agreed to as of the date thereof. TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA By: /s/ Roi G. Chandy Name: Roi G. Chandy Title: Director The foregoing is hereby agreed to as of the date thereof. WOODMEN OF THE WORLD LIFE INSURANCE SOCIETY By: /s/ James E. Stolze Name: James E. Stolze Title: Assistant Vice President The foregoing is hereby agreed to as of the date thereof. LIFE INSURANCE COMPANY OF THE SOUTHWEST By: /s/ R. Scott Higgins Name: R. Scott Higgins Title: Vice President, Sentinel Asset Management The foregoing is hereby agreed to as of the date thereof. OHIO NATIONAL LIFE ASSURANCE CORPORATION By: /s/ Jed R. Martin Name: Jed R. Martin Title: Vice President, Private Placements The foregoing is hereby agreed to as of the date thereof. AMERICAN FAMILY LIFE INSURANCE COMPANY By: /s/ Phillip Hannifan Name: Phillip Hannifan Title: Investment Director Schedule A Existing Defaults Events of Default under Section 12.1(c) of the Note Purchase Agreement by virtue of (a) the continuing failure of the Company to comply with Section 11.3 (the Consolidated Debt covenant which is tested at all times) and (b) the failure of the Company to give the written notice of its failure to comply with Section 11.3, as required by Section 7.1(d). Events of Default under Section 12(f) of the Note Purchase Agreement (by operation of Section 5(j) of the Existing NPA Waiver) due to the existence of the defaults, events of default and Securitization Defaults described in the Other December 2006 Waivers. Schedule B Description of Consolidated Debt [to be provided by the Company] EXHIBIT 2.1(a) THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. [FORM OF SENIOR NOTE] INVACARE CORPORATION 6.15% SENIOR NOTE DUE APRIL 27, 2016 No. R -__ PPN: 461203 C* 0 $__________ [Date] FOR VALUE RECEIVED, the undersigned, INVACARE CORPORATION, an Ohio corporation (herein called the "Company"), hereby promises to pay to _______________ or registered assigns, the principal sum of _________________________________ DOLLARS ($__________) on April 27, 2016, with interest (computed on the basis of a 360-day year of twelve 30-day months) (a) on the unpaid balance thereof at a rate equal to 6.15% per annum from the date hereof, payable semiannually on April 27 and October 27 in each year, commencing with the April 27 or October 27 next succeeding the date hereof, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, on any overdue payment of interest, and, during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount (as defined in the Note Purchase Agreements (defined below)), payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand), at a rate per annum from time to time equal to the Default Rate (as defined in the Note Purchase Agreements). Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at Elyria, Ohio or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreements referred to below. This Note is one of the 6.15% Senior Notes due April 27, 2016 (herein called the "Notes") issued pursuant to separate Note Purchase Agreements, each dated as of April 27, 2006, as amended by that certain Waiver and Amendment, dated as of November 14, 2006, to Note Purchase Agreements dated as of April 27, 2006, and that certain Second Waiver and Amendment, dated as of December 15, 2006, to Note Purchase Agreements dated as of April 27, 2006 (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, collectively, the "Note Purchase Agreements"), among the Company and the respective Purchasers named therein and is entitled to the benefits thereof. Each holder of this Note will be deemed, by its acceptance hereof, (i) to have agreed to the confidentiality provisions set forth in Section 21 of the Note Purchase Agreements and (ii) to have made the representation set forth in Section 6.2 of the Note Purchase Agreements. This Note is a registered Note and, as provided in the Note Purchase Agreements, upon surrender of this Note for registration of transfer, duly endorsed, or accompanied by a written instrument of transfer, duly executed, by the registered holder hereof or such holder's attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee. Prior to due presentment for registration of transfer, the Company may treat the person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary. This Note is subject to certain prepayments in the events, on the terms and in the manner and amounts as provided in the Note Purchase Agreements. This Note is also subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreements, but not otherwise. If an Event of Default, as defined in the Note Purchase Agreements, occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole Amount) and with the effect provided in the Note Purchase Agreements. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE. INVACARE CORPORATION By: Name: ___________________________________ Title: __________________________________ -----END PRIVACY-ENHANCED MESSAGE-----