Invacare 2015 Annual Report Download - page 124

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INVACARE CORPORATION AND SUBSIDIAIRIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
FS-52
company’s ongoing turnaround and addressing potential risks and contingencies described in the company’s Risk Factors as
included in this Form 10-K.
Supplemental Guarantor Information
Effective February 12, 2007, substantially all of the domestic subsidiaries (the “Guarantor Subsidiaries”) of the company
became guarantors of the indebtedness of Invacare Corporation under its 4.125% Convertible Senior Subordinated Debentures
due 2027 (the “Debentures”) with an original aggregate principal amount of $135,000,000. The majority of the company’s
subsidiaries are not guaranteeing the indebtedness of the Debentures (the “Non-Guarantor Subsidiaries”). Each of the Guarantor
Subsidiaries has fully and unconditionally guaranteed, on a joint and several basis, to pay principal, premium and interest related
to the Debentures and each of the Guarantor Subsidiaries are directly or indirectly100%-owned subsidiaries of the company.
Specifically, the Debentures are guaranteed on an unsecured senior subordinated basis by all of the company's existing domestic
subsidiaries (other than the company's captive insurance subsidiary and any receivables subsidiaries) and certain future direct and
indirect 100% owned domestic subsidiaries. All of the guarantors are released and relieved of any liability under such guarantees
upon the satisfaction and discharge of the indenture governing the debentures and the payment in full of the debentures. Additionally,
in the event any subsidiary guarantor no longer guarantees any of the company's existing or future senior debt incurred in a public
or private U.S. capital markets transaction, such guarantor shall be released and relieved of any liability which it has under the
indenture governing the debentures. On February 16, 2016, all of the company’s subsidiaries were released as guarantors of the
Debentures, pursuant to the terms of the Indenture, dated as of February 12, 2007, between the company and the trustee named
therein. See "Subsequent Events".
Presented below are the consolidating condensed financial statements of Invacare Corporation (Parent), its combined
Guarantor Subsidiaries and combined Non-Guarantor Subsidiaries with their investments in subsidiaries accounted for using the
equity method. The company does not believe that separate financial statements of the Guarantor Subsidiaries are material to
investors and accordingly, separate financial statements and other disclosures related to the Guarantor Subsidiaries are not presented.
CONSOLIDATING CONDENSED STATEMENTS OF OPERATIONS
The
company
(Parent)
Combined
Guarantor
Subsidiaries
Combined
Non-Guarantor
Subsidiaries Eliminations Total
(in thousands)
Year ended December 31, 2015
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 211,178 $ 402,108 $ 649,966 $ (120,914) $ 1,142,338
Cost of products sold . . . . . . . . . . . . . . . . . 187,272 305,592 457,634 (120,984) 829,514
Gross Profit . . . . . . . . . . . . . . . . . . . . 23,906 96,516 192,332 70 312,824
Selling, general and administrative
expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 111,814 63,068 144,965 — 319,847
Charge related to restructuring activities . . 1,339 — 632 — 1,971
Income (loss) from equity investee . . . . . . 69,636 29,353 703 (99,692) —
Interest expense (income)—net . . . . . . . . . 3,011 428 (693) — 2,746
Earnings (Loss) from Continuing
Operations Before Income Taxes. . . (22,622) 62,373 48,131 (99,622)(11,740)
Income taxes. . . . . . . . . . . . . . . . . . . . . . . . 3,568 — 11,142 — 14,710
Net Earnings (Loss) from
Continuing Operations . . . . . . . . . . . (26,190) 62,373 36,989 (99,622)(26,450)
Net Earnings from Discontinued
Operations . . . . . . . . . . . . . . . . . . . . . — 260 — — 260
Net Earnings (Loss). . . . . . . . . . . . . . (26,190) 62,633 36,989 (99,622)(26,190)
Other Comprehensive Income (Loss),
net of Tax. . . . . . . . . . . . . . . . . . . . . . . . . . (81,006) (15,037)(67,842) 82,879 (81,006)
Comprehensive Income (Loss) . . . . . . . . $ (107,196) $ 47,596 $ (30,853) $ (16,743) $ (107,196)