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INVACARE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Long-Term Debt
Debt as of December 31, 2009 and 2008 consisted of the following (in thousands):
2009 2008
$250,000,000 term loan facility at 2.25% above local interbank offered rates (LIBOR),
expires February 12, 2013 ................................................. $ — $160,000
$175,000,000 senior notes at 9.75%, due in February 2015 ......................... 173,490 173,193
$135,000,000 convertible senior subordinated debentures at 4.125%, due in February
2027 .................................................................. 86,728 82,586
Revolving credit agreements, due in February 2012 .............................. 1,725 —
Other notes and lease obligations ............................................. 11,382 10,627
273,325 426,406
Less current maturities of long-term debt ....................................... (1,091) (18,699)
$272,234 $407,707
On February 12, 2007, the company completed a financing program which provided the company with total
capacity of approximately $710 million, the net proceeds of which were used to refinance substantially all of the
company’s then existing indebtedness and pay related fees and expenses. As part of the financing, the company
entered into a $400,000,000 senior secured credit facility consisting of a $250,000,000 term loan facility and a
$150,000,000 revolving credit facility. The company’s obligations under the senior secured credit facility are
secured by substantially all of the company’s assets and are guaranteed by its material domestic subsidiaries,
with certain obligations also guaranteed by its material foreign subsidiaries. Borrowings under the revolving
credit facility currently bear interest at LIBOR plus a margin of 1.25%, including a facility fee of 0.25% per
annum on the facility. During 2009, the company fully paid down its $250 million term loan facility which was
not due to expire until February 2013. As a result, approximately $2.9 million pre-tax of deferred financing fees,
which were previously capitalized, were expensed in the NA/HME operating segment.
In February 2007, the company also completed the sale of $175,000,000 principal amount of its
9.75% Senior Notes due 2015 (the “Senior Notes”) to qualified institutional buyers pursuant to Rule 144A and to
non-U.S. persons outside the United States in reliance on Regulation S under the Securities Act of 1933, as
amended (the “Securities Act”). The notes are unsecured senior obligations of the company guaranteed by
substantially all of the company’s domestic subsidiaries, and pay interest at 9.75% per annum on each February 15
and August 15. The net proceeds to the company from the offering of the notes, after deducting the initial
purchasers’ discount and the offering expenses payable by the company, were approximately $167,000,000.
Also, as part of the refinancing, the company completed the sale of $135,000,000 principal amount of its
Convertible Senior Subordinated Debentures due 2027 (the “Convertible Notes”) to qualified institutional buyers
pursuant to Rule 144A under the Securities Act. The debentures are unsecured senior subordinated obligations of
the company guaranteed by substantially all of the company’s domestic subsidiaries, pay interest at 4.125% per
annum on each February 1 and August 1, and are convertible upon satisfaction of certain conditions into cash,
common shares of the company, or a combination of cash and common shares of the company, subject to certain
conditions, and at the company’s discretion. The debentures allow the company to satisfy the conversion using
any combination of cash or stock. The company intends to satisfy the accreted value of the debentures using
cash. Assuming adequate cash on hand at the time of conversion, the company also intends to satisfy the
conversion spread using cash, as opposed to stock.
The company includes the dilutive effect of shares necessary to settle the conversion spread in the Net
Earnings (loss) per Share—Assuming Dilution calculation unless such amounts are antidilutive. The initial
FS-17