Invacare announced actions to strengthen the company and position it for long-term success. To facilitate its financial restructuring, the company has entered into a restructuring support agreement, or RSA agreement, with substantially all of its debt holders, including its term loan lender, all of the holders of convertible senior secured notes, and holders of a majority of its convertible senior unsecured notes. The agreement provides for a significant reduction of the company’s debt balance and a substantial new money investment, which will enhance the company’s liquidity, thereby enabling it to invest for future growth. Specifically, the transactions agreed to in the RSA contemplate a substantial reduction of the company’s funded debt by approximately $240M. In addition, the RSA includes a backstop for a rights offering to holders of claims on account of the company’s unsecured notes and holders of general unsecured claims, providing the company with $60 million of equity capital to repay certain of its debt obligations and facilitate the company’s transformation plan. To effectuate the transactions contemplated by the agreement, Invacare and two of its U.S. based subsidiaries commenced voluntary Chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas. Invacare’s other businesses throughout the rest of the world remain strong and are not included in these filings. The company does not anticipate these filings to impact its ability to manufacture and deliver products to its customers globally.
Published first on TheFly
