INVACARE CORP (Form: 8-K, Received: 01/07/2009 17:06:41)

INVACARE CORPORATION

/s/ Joseph S. Usaj

SR VP Human Resources

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 31, 2008

INVACARE CORPORATION

(Exact name of registrant as specified in its charter)


Ohio	1-15103	95-2680965

(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification 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 or former address, if changed 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):

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS


Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 7.01. Regulation FD Disclosure
Item 9.01. Financial Statements and Exhibits
SIGNATURE
Exhibit Index
EX-10.1
EX-10.2
EX-10.3
EX-10.4
EX-10.5
EX-99.1


Item 5.02.		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Invacare Corporation (“Invacare” or the “Company”) has approved amendments and taken other actions with respect to a number of the Company’s compensation and benefit plans and to certain of its agreements with its executive officers and employees, primarily to reflect changes as necessary to comply with Section 409A of the Internal Revenue Code (“Section 409A”). Section 409A is the tax law enacted in 2004 governing “non-qualified” deferred compensation arrangements that imposes additional tax and penalties on service providers (including employees and directors) if a covered arrangement does not comply with Section 409A. Final IRS regulations require documentary compliance with Section 409A by December 31, 2008. The following is a summary of the most significant terms of these amendments and revisions.

DC Plus Plan

The DC Plus Plan is a non-qualified contributory savings plan for highly compensated employees, which allows participants to defer compensation above the amount allowed in the Invacare Retirement Savings Plan (the Company’s qualified retirement plan) and to provide participants with additional pre-tax savings opportunities. In 2004, the Company froze what was originally established as the 401(k) Benefit Equalization Plus Plan (the “401(k) Plus Plan”) and prohibited further deferrals and contributions to that plan for compensation earned after December 31, 2004. It then adopted the DC Plus Plan, effective January 1, 2005, in order to address the requirements of Section 409A. All benefits of the participants earned and vested in the 401(k) Plus Plan as of December 31, 2004 remain preserved under the pre-existing plan provisions.

As has been described in the Company’s proxy statements, the DC Plus Plan allows participants from and after January 1, 2005 to defer all or any portion of their annual cash bonus compensation and up to 50% of their salary to the plan. The Company provides a matching contribution on amounts deferred of up to an annual maximum of 2% of salary, as well as a quarterly contribution of up to 4% of salary for the benefit of eligible participants (both reduced by the actual matching and quarterly contributions under the qualified plan). Previously, the DC Plus Plan was designed as a “pour-over” plan that transferred to the qualified plan deferrals up to certain IRS limits on an annual basis, but that feature was removed effective January 1, 2009. Participants may allocate contributions among an array of funds representing a full range of risk/return profiles, including Company common shares reflected in phantom share units. Employee deferrals and contributions by the Company for the benefit of each employee are credited with earnings, gains or losses based on the performances of investment funds selected by the employee. These funds previously were the same as those offered for investment under the qualified plan, but as of January 1, 2009, a new series of investment choices is being offered under the DC Plus Plan. Participants do not have any direct interest in or ownership of the funds. Participant’s contributions are always 100% vested and Company contributions vest according to a five year graduated scale. All distributions from the plan are in the form of cash and are paid in a single lump sum upon termination of employment or death, unless the participant terminates employment after reaching retirement age, the account is over the required threshold amount (i.e., over $20,000 in the 401(k) Plus Plan portion and $16,500, as adjusted from time to time, in the DC Plus Plan portion), and the participant has elected to receive payment in annual installments instead of a lump sum. The installment period cannot exceed 15 years. Distributions under the DC Plus Plan may be made only upon termination of employment,

death, disability or hardship, or at a time certain specified by the employee at the time of deferral in accordance with the terms of the plan.

Supplemental Executive Retirement Plan

For many years, the Company has provided a Supplemental Executive Retirement Plan for certain of its executive officers (the “Pre-existing SERP”), which has been described in the Company’s proxy statements. In order to comply with Section 409A, to simplify the design and accounting for future benefits and to avoid an unintended diminution of benefits under the Pre-existing SERP for executives who worked past normal retirement age, the Company has amended and restated this plan to alter the benefits provided to current and future SERP participants.

The currently-employed SERP participants are Messrs. Mixon (Chairman and Chief Executive Officer), Blouch (President and Chief Operating Officer), Gudbranson (Senior Vice President and Chief Financial Officer), Richey (President - Invacare Technologies and Senior Vice President - Product Development), Slangen (Senior Vice President Sales and Marketing), Usaj (Senior Vice President Human Resources) and LaPlaca (Senior Vice President and General Counsel) (the “Active Participants”). As of December 31, 2008, Invacare has an aggregate, accumulated benefit obligation to those participants of approximately $19,348,000. There is an additional benefit owed to previously-employed participants, but those individuals are not affected by Section 409A and they will remain entitled to benefits under the Pre-existing SERP. The Company has purchased life insurance policies as a way to assist in the ultimate funding of its SERP obligations.

Except for changes mandated by Section 409A (which generally are adverse to the participating executive), the most significant difference between the Pre-existing SERP and the amended SERP is the way that benefits are earned. The Pre-existing SERP is intended to provide a benefit equal to 50% of final compensation (subject to certain offsets) at normal retirement. Under the amended plan, the benefit is stated as a hypothetical account balance. Active Participants will receive an initial credit to their account balance approximately equal to their accumulated benefit obligation from the Pre-existing SERP as of December 31, 2008. Thereafter, so long as the Company continues the plan in the amended form, Active Participants will receive specified annual company credits, plus annual interest credits, to their hypothetical accounts designed to result in a benefit after a “full career” at Invacare that approximates the projected benefit provided under the Pre-existing SERP after a “full career.” Each of the Active Participants has signed a participation agreement confirming his or her consent to the amended Plan design. Future participants who are selected by the Compensation Committee of the Board (the “Committee”) will be entitled to receive annual contributions, plus interest credits, to their hypothetical account balances equal to a specified percentage of their ongoing targeted compensation. The particular percentage for each future participant will be based upon his or her age at the time of initial participation, as specified in the amended plan. Once a participant reaches his or her full career normal retirement benefit (approximately 3.65 times his or her then targeted compensation), the only additional annual credits under the current design would be those for interest (initially 6% of the account balance, subject to adjustment by the Committee). In designing the SERP amendment, the Company attempted to avoid any change which would materially increase Invacare’s future earnings charges attributable to the SERP.

The Pre-existing SERP also provided for enhanced benefits where a participant’s career at Invacare is interrupted in certain circumstances, such as certain terminations of employment within the two years following a change in control, or if someone should become disabled. Since the new design builds a participant’s benefit with annual credits over a period of years, benefits payable to a participant who terminates at the early end of a “full career” due to disability or within the two years following a change in control could be adversely affected. As a result, the amended Plan provides additional credits in the event of termination following disability or in some cases within two years of a change in control. These additional credits are designed to bring the affected participant’s account to an amount that approximates the benefit that would have been provided under the Pre-existing SERP.

Change of Control Agreements

For many years, Invacare has had agreements with each of its named executive officers that protect them against certain circumstances, including certain terminations of their employment, within the three-year period following a change of control as defined in the agreements. Largely in response to Section 409A, these so-called “double-trigger” change of control agreements have been amended and restated effective as of December 31, 2008. These agreements are referred to as “double-trigger” agreements because payment of substantially all of the benefits under an agreement (with the exception of a retention bonus equal to one year’s salary payable if the executive remains employed on the date that is one year following a change of control) are not payable until both a change of control has occurred, and the covered executive has suffered a qualifying termination of employment or resignation for good reason. The payments and benefits provided under the amended and restated change of control agreements remain substantially unchanged from the original version except that the new agreement references provision of additional benefits under several newly adopted plans, including the amended SERP and the DC Plus Plan (described above) and eliminates payments under the original agreements that were equivalent to three years of automobile subsidy and club dues.

Other Plans and Agreements

Invacare also amended several other employee benefit plans and agreements that cover benefits or compensation payable to its directors and/or executive officers, including amendments or actions taken to achieve compliance with Section 409A with respect to the Company’s 2003 Performance Plan, as amended, and the Company’s Severance Protection Agreement with Gerald B. Blouch.

The foregoing descriptions of the Amended and Restated Supplemental Executive Retirement Plan, the related participation agreement, the Amended and Restated Change of Control Agreements and the DC Plus Plan do not purport to be complete and are qualified in their entirety by reference to the full text of those documents, copies of which are attached hereto as Exhibit 10.1, 10.2, 10.3 and 10.4, respectively, and are incorporated herein by reference.

Item 7.01. Regulation FD Disclosure.

On December 31, 2008, the Company issued a press release, which is furnished herewith as

Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.


Exhibit Number		Description

10.1		Cash Balance Supplemental Executive Retirement Plan, as amended and restated, effective December 31, 2008.

10.2		Form of Participation Agreement, for current participants in the Cash Balance Supplemental Executive Retirement Plan, as of December 31, 2008, with schedule of participants.

10.3		Form of Change of Control Agreement, as amended, as of December 31, 2008, with schedule of participants.

10.4		Deferred Compensation Plus Plan, as amended, effective December 31, 2008.

10.5		Amended and Restated Severance Protection Agreement, between the Company and Gerald B. Blouch, effective December 31, 2008.

99.1		Press Release, dated December 31, 2008.

SIGNATURE

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 hereunto duly authorized.


		Invacare Corporation
		(Registrant)

Date: January 7, 2009

		/s/ Anthony C. LaPlaca

		Anthony C. LaPlaca
		Senior Vice President and General Counsel

Exhibit Index


Exhibit Number		Description

10.1		Cash Balance Supplemental Executive Retirement Plan, as amended and restated, effective December 31, 2008.

10.2		Form of Participation Agreement, for current participants in the Cash Balance Supplemental Executive Retirement Plan, as of December 31, 2008, with schedule of participants.

10.3		Form of Change of Control Agreement, as amended, as of December 31, 2008, with schedule of participants.

10.4		Deferred Compensation Plus Plan, as amended, effective December 31, 2008.

10.5		Amended and Restated Severance Protection Agreement, between the Company and Gerald B. Blouch, effective December 31, 2008.

99.1		Press Release, dated December 31, 2008.

Exhibit 10.1

INVACARE CORPORATION

CASH BALANCE SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN

As Amended and Restated December 31, 2008

INVACARE CORPORATION
CASH BALANCE SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN
(As Amended and Restated Effective December 31, 2008)

Table of Contents


	Page
ARTICLE I		1

INTRODUCTION		1
1.1 Background		1
1.2 Name of Plan		1
1.3 Purposes of Plan		1
1.4 “Top Hat” Pension Benefit Plan		1
1.5 Tax Treatment		1
1.6 Plan Unfunded		1
1.7 Effective Date and Scope of Restatement		2
1.8 Administration		2

ARTICLE II		3

DEFINITIONS AND CONSTRUCTION		3
2.1 Definitions		3
2.2 Number and Gender		9
2.3 Headings		9

ARTICLE III		10

PARTICIPATION AND ELIGIBILITY		10
3.1 Participation		10
3.2 Commencement of Participation		10
3.3 Cessation of Active Participation		10

ARTICLE IV		11

CREDITS AND BENEFITS		11
4.1 Annual Credits		11
4.2 Earnings on Account		12
4.3 Retirement Benefit		12
4.4 Termination Benefit		12
4.5 Disability Benefit		13
4.6 Death Benefit		13
4.8 Change in Control		13

ARTICLE V		14


	Page
FORM OF PAYMENT		14
5.1 Form of Payment		14
5.2 Change in Date or Form of Distribution		14
5.3 Transition Elections and Provisions		15
5.4 Designation of Beneficiaries		15
5.5 Change of Beneficiary Designation		15
5.6 No Beneficiary Designation		15
5.7 Withholding		16

ARTICLE VI		17

ADMINISTRATION		17
6.1 Committee		17
6.2 General Powers of Administration		17
6.3 Indemnification of Committee		18

ARTICLE VII		19

DETERMINATION OF BENEFITS, CLAIMS PROCEDURE AND ADMINISTRATION		19
7.1 Claims		19
7.2 Claim Decision		19
7.3 Request for Review of a Denied Claim		20
7.4 Review of Decision		20
7.5 Discretionary Authority		21
7.6 Disability Benefit Claims Procedures		21

ARTICLE VIII		23

AMENDMENT AND TERMINATION		23
8.1 Power to Amend or Terminate		23
8.2 Distribution Upon Plan Termination		23

ARTICLE IX		25

MISCELLANEOUS		25
9.1 Plan Not a Contract of Employment		25
9.2 Hypothetical Accounts and Creditor Status of Participants		25
9.3 Investments		25
9.4 Non-Assignability of Benefits		26
9.5 Severability		26
9.6 Governing Laws		26
9.7 Binding Effect		26
9.8 Entire Agreement		26
9.9 No Guaranty of Tax Consequences		26

INVACARE CORPORATION
CASH BALANCE SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN
(As Amended and Restated Effective December 31, 2008)

ARTICLE I
INTRODUCTION

1.1 Background.

The Company maintains the Invacare Corporation Supplemental Executive Retirement Plan (the “Plan”), which was originally adopted effective May 1, 1995, and amended and restated effective February 1, 2000. The Plan is hereby amended and restated effective December 31, 2008, in the form set forth herein.

1.2 Name of Plan.

This Plan was formerly known as the Invacare Corporation Supplemental Executive Retirement Plan, and as restated herein shall hereinafter be referred to as the Invacare Corporation Cash Balance Supplemental Executive Retirement Plan.

1.3 Purposes of Plan.

The purposes of the Plan are to provide deferred compensation in order to help attract and retain a select group of management or highly compensated Employees of Invacare Corporation (the “Company”) and to supplement the benefits under other retirement and savings plans offered by the Company for such Employees.

1.4 “Top Hat” Pension Benefit Plan.

The Plan is an “employee pension benefit plan” within the meaning of ERISA Section 3(2). The Plan is intended to be maintained, however, for a select group of management or highly compensated employees and, therefore, to be exempt from Parts 2, 3 and 4 of Title 1 of ERISA and shall be construed and administered accordingly.

1.5 Tax Treatment.

The Plan is not intended to qualify under Code Section 401(a). However, the Plan is intended to meet the requirements to avoid adverse tax consequences under Code Section 409A and shall be construed and administered accordingly.

1.6 Plan Unfunded.

The Plan is intended to be unfunded for purposes of ERISA and the Code and shall be construed and administered accordingly. All benefits shall be unfunded, unsecured promises of the Company to be paid from the general assets of the Company and no amounts will be set aside for the benefit of Participants or their Beneficiaries. As provided in Section 9.3, however, the Company may acquire assets or establish a trust to assist the Company in meeting

its anticipated liabilities under the Plan; provided that all such assets continue to be subject to the claims of the Company’s creditors in the event of its insolvency.

1.7 Effective Date and Scope of Restatement.

This amendment and restatement of the Plan is effective December 31, 2008 and applies in full with respect to any Participant who terminates employment on or after December 31, 2008. All Participants who, as of December 31, 2008, are Employees of the Company have consented to this amendment and restatement. As amended and restated herein, this Plan utilizes a cash balance approach, which provides retirement benefits determined with reference to hypothetical account balances determined under a formula. Prior to this restatement, the Plan utilized a traditional defined benefit formula.

The terms of the Plan as in effect on December 31, 2004 (attached hereto as Exhibit A), shall continue in full force and effect with respect to any Participant who terminated employment on or before December 31, 2004, with vested benefits under the Plan (“Grandfathered Participants”), except to the extent such terms are expressly amended with respect to such Grandfathered Participants; provided that no such amendment shall be effective to the extent that it would, for purposes of Code Section 409A, materially modify the benefits earned and vested under this Plan by Grandfathered Participants as of December 31, 2004, unless such amendment specifically indicates that it is intended to materially modify such benefits. Except to the extent otherwise provided in any such amendment, the right to benefits and the time, form and amount of benefits, if any, payable to a Grandfathered Participant, or to a Grandfathered Participant’s beneficiary, shall be determined in accordance with the terms and provisions of the Plan in effect as of December 31, 2004 (or, if earlier, as of the date of such Grandfathered Participant’s most recent termination of employment).

With respect to any Participant who is not a Grandfathered Participant, but who terminated employment on or before December 31, 2008 (“Former Participant”), the terms of the Plan as in effect on December 31, 2004 shall apply as to the right to benefits and value of benefits, if any, except as expressly further modified herein or in a later amendment hereunder, but the time and form of such benefits (and the amount payable based on such time and form) shall be determined pursuant to transition elections and provisions under Section 5.3.

This document reflects the provisions of the Plan in effect for periods on and after December 31, 2008. For the period from January 1, 2005 through December 31, 2008, the Plan was operated in good faith compliance with Code Section 409A and applicable transition guidance and relief thereunder (including but not limited to Notice 2007-86), but this document is not intended to fully reflect the operation of the Plan during such period.

1.8 Administration.

The Plan shall be administered by the Committee or its delegates, as set forth in Article VI.

ARTICLE II
DEFINITIONS AND CONSTRUCTION

2.1 Definitions.

For purposes of the Plan, the following words and phrases shall have the respective meanings set forth below, unless their context clearly requires a different meaning:

	(a)		“Account” means the hypothetical account maintained by the Company for bookkeeping purposes in order to determine the benefits payable hereunder, to which shall be credited the Participant’s Credits calculated under Section 4.1, and earnings determined in accordance with Section 4.2, and from which shall be debited any distributions and forfeitures.

	(b)		“Affiliate” means any corporation or business organization during any period during which it would be treated, together with the Company, as a single employer for purposes of Code Sections 414(b) or (c).

	(c)		“Base Salary” means, for any Participant for any Plan Year, the portion of the cash compensation constituting salary and commissions which is paid by the Company to or for the benefit of such individual for services rendered or labor performed while a Participant for such Plan Year, including any amounts such Participant could have received in cash in lieu of (i) deferrals pursuant to any qualified or nonqualified plan of deferred compensation and (ii) contributions made on his behalf to any qualified plan maintained by the Company or to any cafeteria plan under Code Section 125 maintained by the Company. In the event any determination is required to be made under this Plan with respect to a Participant after the beginning of a Plan Year but before such Participant’s Base Salary for such Plan Year has been determined, the Base Salary as in effect at the end of the immediately preceding Plan Year shall be used.

	(d)		“Beneficiary” means the person or persons designated by the Participant in accordance with Section 5.4 or, in the absence of an effective designation, the person or entity described in Section 5.6.

	(e)		“Board” means the Board of Directors of the Company.

	(f)		“Bonus” means, for any Participant for any Plan Year, the target amount of bonus for such individual with respect to such Plan Year under the Company’s Executive Incentive Bonus Plan or any successor to such plan. In the event any determination is required to be made under this Plan with respect to a Participant after the beginning of a Plan Year but before such Participant’s target

Bonus for such Plan Year has been determined, the Bonus as in effect at the end of the immediately preceding Plan Year shall be used.

(g)

“Change in Control” means the happening of any of the following events:

	(i)		Any one person, or more than one person acting as a group (other than (x) the Company or any of its subsidiaries, or (y) any employee benefit plan or employee stock ownership plan or related trust of the Company or any of its subsidiaries, or (z) any person or entity organized, appointed, or established by the Company or any of its subsidiaries, for or pursuant to the terms of any such plan or trust), acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company (as determined by reference to voting power in the election of directors). However, if any one person, or more than one person acting as a group, is considered to own more than 50% of the total fair market value or total voting power of the stock of the Company, the acquisition of additional stock by the same person or persons is not considered to cause a Change in Control. An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Company acquires its stock in exchange for cash or other property will be treated as an acquisition of stock for purposes of this subsection (g). This subsection (g) applies only when there is a transfer of stock of the Company (or issuance of stock of the Company) and stock in the Company remains outstanding after the transaction.

	(ii)		Any one person, or more than one person acting as a group (other than (x) the Company or any of its subsidiaries, or (y) any employee benefit plan or employee stock ownership plan or related trust of the Company or any of its subsidiaries, or (z) any person or entity organized, appointed, or established by the Company or any of its subsidiaries, for or pursuant to the terms of any such plan), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing 30% or more of the total voting power of the stock of the Company (as determined by reference to voting power in the election of directors).

	(iii)		A majority of members of the Board of Directors is replaced during any 12-month period by Directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors prior to the date of the appointment or election.

	(iv)		Any one person, or more than one person acting as a group (other than (x) the Company or any of its subsidiaries, or (y) any employee benefit plan or employee stock ownership plan or related trust of the Company or any of its subsidiaries, or (z) any person or entity organized, appointed, or established by the Company or any of its subsidiaries, for or pursuant to the terms of any such plan), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons), whether by operation of law or otherwise, assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions.

			In determining whether a Change in Control has occurred, this definition shall be interpreted in accordance with regulations under Code Section 409A.

	(h)		“Code” means the Internal Revenue Code of 1986, as amended. In general, a reference to the Code will include all lawful regulations and pronouncements promulgated thereunder, including without limitation, all applicable transition relief with respect to Code Section 409A.

	(i)		“Committee” means the administrative committee named to administer the Plan pursuant to Section 6.1.

	(j)		“Compensation Committee” means the Compensation and Management Development Committee of the Board or such successor committee as may hereafter be appointed by the Board. On and after a Change in Control, the Compensation Committee shall consist of the same individuals who constituted the Compensation Committee immediately prior to the Change in Control, or such successors as may be designated by the majority of them.

	(k)		“Company” means Invacare Corporation and any successor thereto.

	(l)		“Credit” means the annual amount credited to a Participant’s Account calculated in accordance with Section 4.1.

	(m)		“Directors” means the Board of Directors of the Company.

	(n)		“Disability” means a physical or mental impairment that qualifies a Participant for benefits under the Company’s Long Term Disability Plan.

	(o)		“Earnings” means, for any Plan Year, the Participant’s:

	(i)		Base Salary for such Plan Year, plus

	(ii)		the Participant’s target Bonus for such Plan Year.

	(p)		“Employee” means any common-law employee of the Company or any Affiliate.

	(q)		“ERISA” means the Employee Retirement Income Security Act of 1974, as amended In general, a reference to ERISA will include all lawful regulations and pronouncements promulgated thereunder.

	(r)		“Interest Crediting Rate” shall mean six percent (6%) interest per annum, compounded annually (or for periods between Valuation Dates which occur more frequently than annually, at such interest rate compounded for such periods as equates to a six percent (6%) interest rate per annum, compounded annually), except to the extent the Committee may declare another rate of periodic interest or other rate of earnings to be applicable, as determined under a methodology described in the regulations under Code Section 3121(v); provided, however, that after a Change in Control, the Committee shall obtain the consent of all affected Participants in order to reduce the Interest Crediting Rate.

	(s)		“Normal Retirement Date” means the earlier of a Participant’s (i) attainment of age sixty-two (62) and completion of fifteen (15) or more years of Vesting Service, or (ii) attainment of age sixty-five (65).

	(t)		“Participant” means each Employee who has been selected for participation in the Plan, who has become a Participant pursuant to Article III and who retains an Account under this Plan.

	(u)		“Participation Agreement” means the Agreement by which a Participant agrees to become a Participant and be bound by the terms of the Plan pursuant to Section 3.2. Each Participation Agreement shall be incorporated into and made a part of this Plan with respect to the applicable Participant.

	(v)		“Plan” means the Invacare Corporation Supplemental Executive Retirement Plan, as restated herein as the Invacare Corporation Cash Balance Supplemental Executive Retirement Plan, as amended from time to time hereafter, and as it previously existed, to the extent applicable with respect to Grandfathered Participants and Former Participants.

	(w)		“Plan Year” means the 12-consecutive month period commencing January 1 of each year ending on the following December 31.

	(x)		“Retirement” means a Participant’s Termination of Employment after Normal Retirement Date.

	(y)		“Termination of Employment” means the separation from service of the Participant’s from the Company and all Affiliates for any reason, which includes:

	(i)		a voluntary resignation;

	(ii)		involuntary discharge for any reason, with or without cause;

	(iii)		retirement;

	(iv)		death;

	(v)		a leave of absence (including military leave, sick leave, or other bona fide leave of absence) but only at the point that such leave exceeds the greatest of (i) six months, (ii) the period for which the Participant’s right to reemployment is guaranteed either by statute or by contract, or (iii) 12 months if such leave constitutes sick leave arising by reason of an injury to, or sickness of, the Participant, which, in either case, involves a medically determinable physical or mental impairment that (y) is expected to result in death or to last for a continuous period of not less than 6 months, and (z) renders the Participant unable to perform the duties of his position of employment or any substantially similar position of employment; or

	(vi)		a permanent decrease in the Participant’s service to a level that is no more than twenty percent (20%) of its prior level.

by the Participant after a certain date or that the level of bona fide services the Participant will perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period (or the full period of services if the Participant has been providing services less than 36 months).

			The transfer of a Participant from the Company to an Affiliate or from an Affiliate to the Company or another Affiliate shall not constitute a Termination of Employment for purposes of this Plan. In addition, without limiting the generality of the foregoing, in determining Affiliates for purposes of applying this definition of Termination of Employment, the usual “at least 80%” standard in Sections 1563(a)(1), (2) and (3) of the Code shall read “at least 50%” (or, where the Compensation Committee has determined that there is a good business reason for such lower limit, “at least 20%”) for purposes of construing Sections 414(b) and 414(c) of the Code.

	(z)		“Valuation Date” means (i) the last day of each calendar quarter and (ii) and any special valuation date designated by the Committee.

	(aa)		“Vesting Percentage” means the percentage of a Participant’s benefit which is nonforfeitable. A Participant’s Vesting Percentage shall be based upon his years of Vesting Service as follows:


Years of Vesting Service	Vesting Percentage
Less than 1		0
1		20
2		40
3		60
4		80
5 or more		100

Notwithstanding the foregoing, a Participant’s benefits shall become 100% vested upon the earliest to occur of his attainment of age sixty five (65) while employed, Disability while employed, death while employed, and Termination of Employment within two (2) years following a Change of Control.

(bb)

“Vesting Service” means, except as may be otherwise provided in a Participant’s Participation Agreement, a Participant’s period of employment while a Participant.

2.2 Number and Gender.

Wherever appropriate herein, words used in the singular shall be considered to include the plural and words used in the plural shall be considered to include the singular. The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender.

2.3 Headings.

The headings of Articles and Sections herein are included solely for convenience, and if there is any conflict between such headings and the rest of the Plan, the text shall control.

ARTICLE III
PARTICIPATION AND ELIGIBILITY

3.1 Participation.

Participants in the Plan are those Employees who (a) are subject to the income tax laws of the United States, (b) are members of a select group of highly compensated or management Employees, (c) are selected by the Compensation Committee, in its sole discretion, as eligible to be Participants and (d) agree to become Participants and to be bound by the terms of the Plan as set forth in Section 3.2. The Compensation Committee, or its designee, shall notify each Participant of his selection as eligible to be a Participant. An Employee who becomes a Participant in the Plan shall remain eligible to continue participation in the Plan for each Plan Year thereafter, unless the Compensation Committee shall determine otherwise.

3.2 Commencement of Participation.

Except as provided in the following sentence, an Employee who has been designated by the Compensation Committee as eligible to become a Participant shall become a Participant effective as of the entry date specified in a Participation Agreement entered into between the Employee and the Company, provided that if such date is other that the first day of a calendar year, any credits made pursuant to Section 4.1(c) for such Plan Year shall be based only on Earnings earned after the entry date. In order to become a Participant, the Employee shall execute a Participation Agreement, in such form as the Committee shall determine, prior to the entry date specified in a Participation Agreement (or, if earlier, within the first 30 days after such Employee is first designated as eligible to become a Participant). At a minimum, a Participation Agreement shall contain the Participant’s agreement to become a Participant and be bound by the terms of the Plan, shall specify the date of the Participant’s entry into the Plan, and shall provide for the Participant’s election as to form of payment pursuant to Section 5.1, as shown in Exhibit B, but may contain such additional or differing terms as the Compensation Committee determines to be appropriate with respect to any one or more Participants.

3.3 Cessation of Active Participation.

Notwithstanding any provision herein to the contrary, an individual who has become a Participant in the Plan shall cease to be an active Participant eligible to receive credits under Section 4.1(b) or (c), effective as of the end of any Plan Year as may be designated by the Compensation Committee of the Board. Any such action shall be communicated to such Participant prior to the effective date of such action. Such termination of active participation shall not impact the time and form of payment of any amounts credited to such Participant’s Account, which will be distributed by the Company in accordance with the other provisions hereof.

ARTICLE IV
CREDITS AND BENEFITS

4.1 Annual Credits.

Except to the extent the Plan is hereafter amended or terminated by the Compensation Committee in a manner permitted by Section 8.1, there shall be credited to each Participant’s hypothetical Account Credits determined as follows:

	(a)		Each Employee who was a Participant as of December 31, 2008 (excluding any Grandfathered Participant or Former Participant) shall receive an initial Credit equal to his accumulated benefit obligation under the prior provisions of this Plan as of December 31, 2008, based on the assumptions utilized in preparing the audited financial statements of the Company for 2008.

	(b)		Each Employee who was a Participant as of December 31, 2008 (excluding any Grandfathered Participant or Former Participant) shall receive an annual Credit equal to the relevant dollar amount set forth in the Participation Agreement between the Company and the Employee for each full or partial Plan Year commencing with 2009 during which he is a Participant and an Employee as of December 31 of such Year, not in excess of the maximum number of Plan Years for such annual Credits as set forth in such Participation Agreement. If a participant is not an Employee for a full Plan Year, the annual Credit shall be ratably reduced to reflect the period in which he is not an Employee.

	(c)		Each Employee who first becomes a Participant in the Plan after December 31, 2008 shall receive for each full or partial Plan Year on and after 2009 during which he is a Participant and an Employee a Credit equal to a percentage of his Earnings for such Plan Year which are earned while a Participant and an Employee (with such Credit being prorated for any partial Plan Year) based upon his age at entry into the Plan, as set forth in the following table, or as otherwise set forth in his Participation Agreement:


Plan	Credit for Plan Year as			Plan		Credit for Plan Year
Entry	a Percentage of			Entry		as a Percentage of
Age	Earnings			Age		Earnings
26		8.00	%		41		15.00	%
27		8.00	%		42		16.00	%
28		9.00	%		43		17.00	%
29		9.00	%		44		18.00	%
30		9.00	%		45		20.00	%
31		10.00	%		46		21.00	%


Plan	Credit for Plan Year as			Plan		Credit for Plan Year
Entry	a Percentage of			Entry		as a Percentage of
Age	Earnings			Age		Earnings
32		10.00	%		47		23.00	%
33		11.00	%		48		23.00	%
34		11.00	%		49		23.00	%
35		12.00	%		50		23.00	%
36		12.00	%		51		24.00	%
37		13.00	%		52		27.00	%
38		13.00	%		53		29.00	%
39		14.00	%		54		32.00	%
40		15.00	%		55+		35.00	%

Notwithstanding the foregoing, in no event shall any annual Credit under this subsection (c) be granted for any Plan Year for any Participant if, as of the June 30 of such Plan Year the Account of such Participant has a value in excess of 3.65 times his Earnings for such Plan Year, or such other amount as may be set forth in his Participation Agreement.

4.2 Earnings on Account.

As of each applicable Valuation Date, the Account of a Participant (excluding any Grandfathered Participant or Former Participant) shall be credited with earnings in an amount equal to his Account balance at such time times the Interest Crediting Rate.

4.3 Retirement Benefit.

On the first day of the seventh month after a Participant’s Retirement (or, if later, the January 2nd of the calendar year following the Participant’s Retirement), the Participant (excluding any Grandfathered Participant or Former Participant) shall receive or commence receipt of his benefit hereunder, which shall be the value of his Account determined in accordance with Section 4.7 and paid in the form determined in accordance with Section 5.1.

4.4 Termination Benefit.

Following a Participant’s Termination of Employment other than for Retirement under Section 4.3, the Participant shall be entitled to his Vested Percentage of his Account, paid in the form determined in accordance with Section 5.1, with payment to be made or commence on the latest of (a) the first day of the seventh month after a Participant’s Termination of Employment, (b) the January 2nd of the calendar year following the Participant’s Termination of Employment, or (c) the first day of the month coincident with or next following the date the Participant reaches age 65. The Vested Percentage shall be determined as of the date of Termination of Employment and the value of the Account shall be determined in accordance with Section 4.7.

4.5 Disability Benefit.

In the event that an Employee who was a Participant (other than a Grandfathered Participant or Former Participant) as of December 31, 2008 incurs a Termination of Employment by reason of Disability, then as of the date of such Termination of Employment, an additional Credit shall be added to the Account of such Participant which shall be equal to the excess, if any, of (a) 3.65 times such Participant’s Earnings for such Plan Year, prorated for years of Vesting Service (rounded to the nearest whole year) less than 15 years (i.e., multiplied by a fraction equal to the number of such years of Vesting Service divided by 15), over (b) the amount of such Participant’s Account as of the date of such Termination of Employment, and no further Credits under Section 4.1(b) or (c) shall be provided with respect to any such Plan Years thereafter. In the event of such a Termination of Employment due to Disability, payment of such Participant’s Account shall be made in accordance with Section 4.4 or, if the Participant satisfied the requirements for Retirement at the time of such Termination of Employment, Section 4.3.

4.6 Death Benefit.

On the 30th day after the death of the Participant either while employed or prior to distribution or commencement of distribution of the Participant’s Account, the Participant’s Beneficiary shall be entitled to receive, in lieu of any other payment hereunder (whether to the Participant, his estate or any other beneficiary), a lump sum payment of the value of the greater of the Participant’s Account as of the date of the Participant’s death or one times the Participant’s Earnings for the Plan Year in which the Participant’s death occurs.

In the event of the death of the Participant after commencement of distribution of the Participant’s Account, but prior to payment of all benefits due, the Participant’s Beneficiary shall be entitled to continue to receive any remaining payments due under the form of benefit payable to the Participant prior to death.

4.7 Valuation of Account.

The value of the Account for purposes of any payment under Sections 4.3-4.6 shall be determined as of the Valuation Date coinciding with or next preceding the date of payment (in the case of installment payments, the Valuation Date preceding the date of each installment).

4.8 Change in Control.

In the event of the Termination of Employment of a Participant for a reason other than death within two (2) years of a Change of Control, such Participant shall be 100% vested in his Account and an additional Credit shall be added to the Account of such Participant which shall be equal to the excess, if any, of (a) 3.65 times the greater of his Earnings for such Plan Year or for the immediately preceding Plan Year, discounted from Normal Retirement Date to the date of such Termination of Employment, if earlier, at a rate of 6% per annum, compounded annually, over (b) the amount of his Account as of the date of such Termination of Employment. Payment of such Participant’s Account shall be made six (6) months after such Termination of Employment.

ARTICLE V
FORM OF PAYMENT

5.1 Form of Payment.

	(a)		A Participant may elect in accordance with the timing set forth in Section 3.2 to receive his Account payable on account of Retirement or Termination of Employment in (i) a lump sum payment or (ii) annual installments amortized over a period of years elected by the Participant not to exceed fifteen (15) years (which set of installment payments shall be treated for purposes of Code Section 409A and the subsequent election provisions of Section 5.2 hereof as a single payment), with earnings continuing to be credited on the unpaid balance of the Account in accordance with the Interest Crediting Rate, and with each installment being equal to the unpaid Account balance as of the Valuation Date coinciding with or next preceding such installment, divided by the remaining number of installments. After the first installment, any later installment shall be made as of the January 1 of the calendar year in which it would otherwise be payable under this Section.

	(b)		If the Participant fails to make a timely election under Section 5.1(a) above, he shall be deemed to have made an election to receive a lump sum payment.

5.2 Change in Date or Form of Distribution.

A Participant may make a single election to change the form of benefit which, as of his commencement of participation is initially applicable to him pursuant to the provisions of Section 5.1, to any of the other forms of benefit permissible under Section 5.1 subject to the following rules:

	(a)		the election may not take effect until at least 12 months after the date on which such election is made;

	(b)		the payment with respect to which such election is made must be deferred (other than a distribution upon death) for a period of five (5) years from the date such payment would otherwise have been paid; and

	(c)		any such election may not be made less than 12 months before the date the payment is scheduled to be paid.

Such election will become irrevocable as of the last permissible date for making such election under the earlier of (a) or (c) above.

5.3 Transition Elections and Provisions.

Notwithstanding Sections 5.1 and 5.2 above, the distributions and distribution elections (and subsequent changes thereto) permitted by the Company prior to 2009 pursuant to the transition relief under Code Section 409A, shall be given full force and effect. In addition, Participants who made transition elections regarding the time and form of distribution shall be permitted to make such further elections to change the time and form of payment as are permitted by the Company under Section 5.2 above.

5.4 Designation of Beneficiaries.

Each Participant shall have the right, at any time, to designate one (1) or more persons or entities as Beneficiary (both primary as well as secondary) (a) to whom benefits under this Plan shall be paid in the event of a Participant’s death prior to distribution or commencement of distribution of the Participant’s Account, or (b) in the event of a Participant’s death after commencement of distribution, to whom any remaining payments shall be paid which may remain due under the form of benefit payable to the Participant prior to death. Each Beneficiary designation shall be in a written form prescribed by the Committee and will be effective only when filed with the Committee during the Participant’s lifetime.

5.5 Change of Beneficiary Designation.

Except as provided below, any nonspousal designation of Beneficiary may be changed by a Participant without the consent of such Beneficiary by the filing of a new designation with the Committee. The filing of a new designation shall cancel all designations previously filed.

5.6 No Beneficiary Designation.

If any Participant fails to properly designate a Beneficiary in the manner provided above, or if the Beneficiary designated by a deceased Participant dies before the Participant or before complete distribution of the Participant’s benefits, the Participant’s Beneficiary shall be the person in the first of the following classes in which there is a survivor:

	(a)		The Participant’s surviving spouse;

	(b)		The Participant’s children in equal shares, except that if any of the children predeceases the Participant but leaves issue surviving, then such issue shall take by right of representation the share the parent would have taken if living;

	(c)		The Participant’s parents;

	(d)		The Participant’s estate.

5.7 Withholding.

All distributions shall be subject to legally required income and employment tax withholding. In addition, and to the extent permitted under Code Section 409A, the Company may elect to accelerate a Participant’s benefit hereunder to pay any Federal Insurance Contributions Act (“FICA”) tax imposed under Code Sections 3101, 3121(a), and Section 3121(v)(2) on compensation deferred under the Plan (the “FICA Amount”), as well as to pay the income tax at source on wages imposed under Code Section 3401 or the corresponding withholding provisions of applicable state, local, or foreign tax laws as a result of the payment of the FICA Amount, and to pay the additional income tax at source on wages attributable to the pyramiding Code Section 3401 wages and taxes However, the total payment accelerated under this Section 5.7 must not exceed the aggregate of the FICA Amount, and the income tax withholding related to such FICA Amount.

ARTICLE VI
ADMINISTRATION

6.1 Committee.

The Plan shall be administered by a Committee, which, prior to a Change in Control, shall consist of the Company’s Chief Financial Officer, the Senior Vice President of Human Resources and the Senior Vice President and General Counsel, or the respective successors to those positions , and on and after a Change in Control shall be the Compensation Committee. The Committee shall be responsible for the general operation and administration of the Plan and for carrying out the provisions thereof. The Committee may delegate to qualified individuals certain aspects of the management and operational responsibilities of the Plan, including the employment of advisors and the delegation of ministerial duties, provided that such delegation is in writing. No member of the Committee who is a Participant shall participate in any matter relating to his status as a Participant or his rights or entitlement to benefits as a Participant, nor shall the Committee make a determination as to eligibility for participation in this Plan.

6.2 General Powers of Administration.

The Committee shall be the Plan Administrator under ERISA (the “Administrator”). The Administrator will be responsible for the general administration of the Plan and will have all powers as may be necessary to carry out the provisions of the Plan and may, from time to time, establish rules for the administration of the Plan and the transaction of the Plan’s business. In addition to any powers, rights and duties set forth elsewhere in this Plan, it will have the following powers and duties:

	(a)		To enact rules, regulations, and procedures and to prescribe the use of such forms as it deems advisable;

	(b)		To appoint or employ agents, attorneys, actuaries, accountants, assistants or other persons (who may also be Participants in this Plan or be employed by or represent the Company) at the expense of the Company, as it deems necessary to keep its records or to assist it in taking any other action authorized or required under the Plan;

	(c)		To interpret the Plan, and to resolve ambiguities, inconsistencies and omissions, to determine any question of fact, to determine the right to benefits of, and the amount of benefits, if any, payable to, any person in accordance with the provisions of the Plan and resolve all questions arising under the Plan;

	(d)		To administer the Plan in accordance with its terms and any rules and regulations it establishes;

	(e)		To maintain records concerning the Plan as it deems sufficient to prepare reports, returns and other information required by the Plan or by law; and

	(f)		To direct the Company to pay benefits under the Plan, and to give other directions and instructions as may be necessary for the proper administration of the Plan.

Any decision, interpretation or other action made or taken by the Administrator arising out of or in connection with the Plan, will be within the absolute discretion of the Administrator, and, subject to the review by the Compensation Committee under Sections 7.3 and 7.4, will be final, binding and conclusive on the Company, and all Participants and Beneficiaries and their respective heirs, executors, administrators, successors and assigns. The Administrator’s determinations under the Plan need not be uniform, and may be made selectively among Participants, whether or not they are similarly situated.

6.3 Indemnification of Committee.

The Company shall indemnify the members of the Committee against any and all claims, losses, damages, expenses, including attorney’s fees, incurred by them, and any liability, including any amounts paid in settlement with their approval, arising from their action or failure to act, except when the same is judicially determined to be attributable to their gross negligence or willful misconduct.

ARTICLE VII
DETERMINATION OF BENEFITS, CLAIMS PROCEDURE AND ADMINISTRATION

7.1 Claims.

A Participant, Beneficiary or other person who believes that he or she is being denied a benefit to which he or she is entitled (hereinafter referred to as “Claimant”), or his or her duly authorized representative, may file a written request for such benefit with the Committee setting forth his or her claim. The request must be addressed to the Committee at the Company at its then principal place of business.

7.2 Claim Decision.

Upon receipt of a claim, the Committee shall advise the Claimant that a reply will be forthcoming within a reasonable period of time, but ordinarily not later than 90 days, and shall, in fact, deliver such reply within such period. However, the Committee may extend the reply period for an additional ninety days for reasonable cause. If the reply period will be extended, the Committee shall advise the Claimant in writing during the initial 90-day period indicating the special circumstances requiring an extension and the date by which the Committee expects to render the benefit determination.

If the claim is denied in whole or in part, the Committee will render a written opinion, using language calculated to be understood by the Claimant, setting forth:

	(a)		the specific reason or reasons for the denial;

	(b)		the specific references to pertinent Plan provisions on which the denial is based;

	(c)		a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation as to why such material or such information is necessary;

	(d)		appropriate information as to the steps to be taken if the Claimant wishes to submit the claim for review, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review; and

	(e)		the time limits for requesting a review of the denial under Section 7.3 and for the actual review of the denial under Section 7.4.

If no notice is provided, the claim will be deemed denied. The interpretations, determinations and decisions of the Committee will be final and binding upon all persons with respect to any right, benefit and privilege hereunder, subject to the review procedures set forth in this Article.

7.3 Request for Review of a Denied Claim.

Within sixty days after the receipt by the Claimant of the written opinion described above, the Claimant may request in writing that the Compensation Committee review the Committee’s prior determination. Such request must be addressed to the Compensation Committee at the Company at its then principal place of business. The Claimant or his or her duly authorized representative may submit written comments, documents, records or other information relating to the denied claim, which information shall be considered in the review under this Section without regard to whether such information was submitted or considered in the initial benefit determination. In the event the Compensation Committee has become the Committee pursuant to Section 6.1, the initial decision on a claim for benefits under Section 7.1 shall be made by such person (including a member of the Compensation Committee) as the Compensation Committee may select, and the review under this Section 7.3 shall be made by the Compensation Committee (or the remaining members thereof).

The Claimant or his or her duly authorized representative shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information which (a) was relied upon by the Committee in making its initial claims decision, (b) was submitted, considered or generated in the course of the Committee making its initial claims decision, without regard to whether such instrument was actually relied upon by the Committee in making its decision or (c) demonstrates compliance by the Committee with its administrative processes and safeguards designed to ensure and to verify that benefit claims determinations are made in accordance with governing Plan documents and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants. If the Claimant does not request a review of the Committee’s determination within such 60-day period, he or she shall be barred and estopped from challenging such determination.

7.4 Review of Decision.

Within a reasonable period of time, ordinarily not later than sixty days, after the Compensation Committee’s receipt of a request for review, it will review the Committee’s prior determination. If special circumstances require that the sixty-day time period be extended, the Compensation Committee will so notify the Claimant within the initial 60-day period indicating the special circumstances requiring an extension and the date by which the Compensation Committee expects to render its decision on review, which shall be as soon as possible but not later than 120 days after receipt of the request for review. In the event that the Compensation Committee extends the determination period on review due to a Claimant’s failure to submit information necessary to decide a claim, the period for making the benefit determination on review shall not take into account the period beginning on the date on which notification of extension is sent to the Claimant and ending on the date on which the Claimant responds to the request for additional information.

Benefits under the Plan will be paid only if the Compensation Committee decides in its discretion that the Claimant is entitled to such benefits. The decision of the Compensation Committee shall be final and non-reviewable, unless found to be arbitrary and capricious by a court of competent review. Such decision will be binding upon the Company and the Claimant. Without limiting the foregoing, if the law provides that the Claimant may bring a legal action

alleging a claim for benefits under this Plan, then, no Claimant may file any lawsuit in any court of law with respect to a claim for benefits hereunder unless such Claimant has timely and properly taken all steps to submit his claim to the Committee and to appeal any benefit denial to the Compensation Committee, and has otherwise followed the application and review procedures of this Plan.

If the Compensation Committee makes an adverse benefit determination on review, the Compensation Committee will render a written opinion, using language calculated to be understood by the Claimant, setting forth:

	(a)		the specific reason or reasons for the denial;

	(b)		the specific references to pertinent Plan provisions on which the denial is based;

	(c)		a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information which (i) was relied upon by the Compensation Committee in making its decision, (ii) was submitted, considered or generated in the course of the Compensation Committee making its decision, without regard to whether such instrument was actually relied upon by the Compensation Committee in making its decision or (iii) demonstrates compliance by the Compensation Committee with its administrative processes and safeguards designed to ensure and to verify that benefit claims determinations are made in accordance with governing Plan documents, and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants; and

	(d)		a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following the adverse benefit determination on such review.

7.5 Discretionary Authority.

The Committee and Compensation Committee shall both have discretionary authority to determine a Claimant’s entitlement to benefits upon his claim or his request for review of a denied claim, respectively.

7.6 Disability Benefit Claims Procedures.

With respect to the determination of a claim for a Disability Benefit, the procedures set forth in Sections 7.2, 7.3 and 7.4 above shall be modified to the extent necessary to conform with the requirements applicable for determinations of disability benefits under 29 C.F.R. Section 2560.503-1, including:

	(a)		The time for the initial determination of benefit under Section 7.2 shall be 45 days (instead of 90 days), and may be extended for two additional periods of 30 days. A notice to the Claimant of any such extension shall be provided prior to the start of the extension and shall indicate that the Committee has determined that the extension is necessary due to matters beyond the control of the Plan, the circumstances requiring the extension, the date by which a decision is expected, the standards upon which entitlement to a Disability Benefit is based, the unresolved issues that prevent a decision on the claim and the additional information needed to resolve the claim. The Claimant shall be afforded at least 45 days in which to provide the specified information (during which time, the period for the Committee to make a determination shall be tolled).

	(b)		To the extent any internal rule, guideline, protocol or similar criterion is relied upon in making an initial adverse claim determination, then a copy of such rule, guideline, protocol or criterion shall be available to the Claimant upon request, free of charge.

	(c)		The time for requesting a review under Section 7.3 of an initial adverse claims determination shall be 180 days (instead of 60 days).

	(d)		The review under Section 7.4 by the Compensation Committee shall be made by a person or entity which is neither the individual nor a subordinate of the individual who made the initial determination of benefit. If the initial determination of benefit was based in whole or in part on a medical judgment, the Compensation Committee shall consult with an appropriate health care professional who was not consulted in the initial determination of benefit and who is not the subordinate of the individual consulted in the initial claims determination. In addition, the identity of the health care professionals consulted in connection with the initial determination and the determination on appeal shall be available to the Claimant upon request.

ARTICLE VIII
AMENDMENT AND TERMINATION

8.1 Power to Amend or Terminate.

The Company reserves the right, by action of the Compensation Committee in its sole discretion, to retroactively or prospectively amend, modify or terminate this Plan, or any Participation Agreement or related document, at any time. Without limiting the generality of the foregoing, the Company specifically retains the right (but not the obligation) to make, prospectively or retroactively, any amendment to this Plan, or any Participation Agreement or related document as it deems necessary or desirable to more fully address issues in connection with compliance with (or exemption from) Code Section 409A and such other laws. Notwithstanding any of the foregoing or any other provisions contained herein, (i) no amendment, modification or termination shall reduce the amounts credited to any Participant’s Account or otherwise impair the rights of the Participant with respect to amounts credited to his Account without his consent, all as determined as of the date of such amendment, modification or termination, and (ii) after a Change in Control, the Plan, or any Participation Agreement or related document, may only be amended, modified or terminated in any manner adverse to any Participant if the consent of all of the affected Participants is obtained.

8.2 Distribution Upon Plan Termination.

In the event the Company terminates the Plan in the manner permitted under Section 8.1, no further amounts shall be credited to Participant Accounts, and no liquidation and payment of benefits shall occur as a result of the termination; provided, however, that subject to the provisions of Section 8.1, the Company may, in its discretion, provide by amendment to the Plan for the liquidation and termination of the Plan where:

	(a)		the termination and liquidation does not occur proximate to a downturn in the financial health of the Company and Affiliates;

	(b)		the Plan and all arrangements required to be aggregated with the Plan under Code Section 409A are terminated and liquidated;

	(c)		no payments, other than those that would be payable under the terms of the Plan and the aggregated arrangements if the termination and liquidation had not occurred, are made within twelve (12) months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan;

	(d)		all payments are made within twenty-four (24) months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan; and

	(e)		the Company and its Affiliates do not adopt a new arrangement that would be aggregated with any terminated arrangement under Code Section 409A, at any time within three (3) years following

the date of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan.

Notwithstanding the above, the Company may, in its discretion, provide by amendment to liquidate and terminate the Plan where the termination and liquidation occurs within 12 months of a corporate dissolution taxed under Code Section 331, or with the approval of a bankruptcy court pursuant to 11 United States Code Section 503(b)(1)(A), provided that all amounts deferred under the Plan are included in the Participants’ gross incomes in the latest of the following years (or, if earlier, the taxable year in which the amount is actually or constructively received):

	(a)		the calendar year in which the termination and liquidation occurs;

	(b)		the first calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or

	(c)		the first calendar year in which the payment is administratively practicable.

ARTICLE IX
MISCELLANEOUS

9.1 Plan Not a Contract of Employment.

The adoption and maintenance of the Plan shall not be or be deemed to be a contract of employment between the Company and any person or to be consideration for the employment of any person. Nothing herein contained shall give or be deemed to give any person the right to be retained in the employ of the Company or to restrict the right of the Company to discharge any person at any time; nor shall the Plan give or be deemed to give the Company the right to require any person to remain in the employ of the Company or to restrict any person’s right to terminate his employment at any time.

9.2 Hypothetical Accounts and Creditor Status of Participants.

The Accounts established under this Plan shall be hypothetical in nature and shall be maintained for bookkeeping purposes only. Neither the Plan nor any of the Accounts shall hold any actual funds or assets. The payments to a Participant, his Beneficiary or any other distributee hereunder shall be made from assets of the Company which shall continue, at all times, to be a part of the general unrestricted assets of the Company. The Company’s obligation hereunder shall be an unfunded and unsecured promise to pay money in the future. The right of any person to receive one or more payments under the Plan shall be an unsecured claim against the general assets of the Company. Any liability of the Company to any Participant, former Participant, or Beneficiary with respect to a right to payment shall be based solely upon contractual obligations created by the Plan and the Participation Agreement entered into by such Participant. Neither the Company, the Board, nor any other person shall be deemed to be a trustee of any amounts to be paid under the Plan. Except as provided in Section 9.3, nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship, between the Company and a Participant, former Participant, Beneficiary, or any other person.

9.3 Investments.

The Company may, in its sole discretion, acquire insurance policies, annuities or other financial vehicles for the purpose of providing future assets to the Company to meet its anticipated liabilities under the Plan. Such policies, annuities or other acquired assets, shall at all times be and remain unrestricted general property and assets of the Company, and Participants and Beneficiaries shall have no rights, other than as general creditors, with respect to any such policies, annuities or other acquired assets. Furthermore, the Company may establish a trust to hold such policies, annuities or other acquired assets, to be used to make, or reimburse the Company for, payments to the Participants or Beneficiaries of all or part of the benefits under this Plan; provided, however, that the trust assets shall at all times remain subject to the claims of general creditors of the Company in the event of its insolvency. In the event that a trust is established under this section, the Company shall remain liable for paying the benefits under this Plan. However, any payment of benefits to a Participant or Beneficiary made by the trust shall satisfy the Company’s obligation to make such payment to such person.

9.4 Non-Assignability of Benefits.

No Participant, Beneficiary or distributee of benefits under the Plan shall have any power or right to transfer, assign, anticipate, hypothecate or otherwise encumber any part or all of the amounts payable hereunder, which are expressly declared to be unassignable and non-transferable. Any such attempted assignment or transfer shall be void. No amount payable hereunder shall, prior to actual payment thereof, be subject to seizure by any creditor of any such Participant, Beneficiary or other distributee for the payment of any debt, judgment, or other obligation, by a proceeding at law or in equity, nor transferable by operation of law in the event of the bankruptcy, insolvency or death of such Participant, Beneficiary or other distributee hereunder.

9.5 Severability.

If any provision of this Plan shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining provisions hereof; instead, each provision shall be fully severable and the Plan shall be construed and enforced as if said illegal or invalid provision had never been included herein.

9.6 Governing Laws.

All provisions of the Plan shall be construed in accordance with the internal laws (but not the choice of laws) of Ohio, except to the extent preempted by federal law.

9.7 Binding Effect.

This Plan shall be binding on each Participant and his heirs and legal representatives and on the Company and its successors and assigns.

9.8 Entire Agreement.

This document and any amendments contain all the terms and provisions of the Plan and shall constitute the entire Plan, any other alleged terms or provisions being of no effect.

9.9 No Guaranty of Tax Consequences.

While the Company has established, and will maintain, the Plan, the Company makes no representation, warranty, commitment, or guaranty concerning the income, employment, or other tax consequences of participation in the Plan under federal, state, or local law.

9.10 Compliance with Code Section 409A.

It is the intention and purpose of the Company that this Plan shall be, at all relevant times, in compliance with (or exempt from) Code Section 409A and all other applicable laws, and this Plan shall be so interpreted and administered. In no event, however, shall this section or any other provisions of this Plan be construed to require the Company to provide any gross-up for the tax consequences of any provisions of, or payments under, this Plan except as

may be provided in any separate agreement between the Company and any Participant, and the Company shall have no responsibility for tax or legal consequences to any Participant (or Beneficiary) resulting from the terms or operation of this Plan.

IN WITNESS WHEREOF, the Company has caused this Plan to be executed on this 31st day of December, 2008.

Exhibit 10.2

INVACARE CORPORATION CASH BALANCE
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Participation Agreement
(Participants as of December 31, 2008)

Agreement to Participate

I, , hereby agree, effective December 31, 2008, to continue my participation in the Invacare Corporation Cash Balance Supplemental Executive Retirement Plan, as amended and restated effective December 31, 2008 (the “Plan”). I agree to be bound by the terms of the Plan as so amended and restated (or as it may be amended in the future in accordance with its terms) and the terms of this Participation Agreement. In addition, I consent to the amendment and restatement of the Invacare Corporation Supplemental Executive Retirement Plan in the form of the Plan.

Amount of Benefits under the Plan

I understand that the Plan generally provides for credits to an account in my name as follows:

(i)		an initial credit equal to my accumulated benefit obligation under the Plan as of December 31, 2008, determined in accordance with the assumptions used in preparing the Company’s audited financial statements for 2008; plus

(ii)		annual credits made on or about December 31 of each calendar year beginning with 2009 equal to such amounts as may be determined from time to time by the Compensation Committee of Invacare Corporation (“Invacare” or the “Company”) for each year that I am both an Employee and a Participant. I understand that it is the present intention of the Committee (which intention, although not binding, shall not be changed except (x) in accordance with the terms of the Plan and (y) unless and until the Committee advises me in writing of any such change) that such annual credits will be in accordance with the column titled “Scheduled SERP Contribution” in the chart attached as Exhibit A to this Participation Agreement and will be provided for the number of years indicated in such Exhibit (such credits to be ratably reduced in any year in which I am not an Employee and Participant for the full year); plus

(iii)		an interest credit, which unless and until changed by the Committee in accordance with the terms of the Plan, will be computed in the manner set forth in the Plan and at the rate of six percent (6%), compounded annually; plus

(iv)		the possibility of special credits in the event of my death, termination of employment due to disability or termination of employment within the two (2) years following a change in control.

I have been given an estimate of my initial credit amount under (i), which is reflected as the Beginning Account Balance on Exhibit A and understand I will be advised of the final confirmed figure after the Company’s audited financial statements are finalized. I understand that each year’s Scheduled SERP Contribution will become final and binding as of December 31 of such year and that interest will be credited to my account quarterly throughout each year unless and until changed by the Committee.

I understand that (a) my Account will be charged periodically in an amount necessary to pay my share of the FICA tax on credits received from the Company and the income tax withholding associated with such FICA tax, (b) that the payment schedule contained on Exhibit A does not reflect the amounts to be charged for FICA and income tax withholding and (c) that my benefits will be taxable at ordinary income rates in effect at the time they are paid. .

Election of Form of Payment

I understand that payment of my benefits under the Plan may be subject to satisfaction of a vesting requirement and will be made at the time and in the form provided under the Plan. If my benefit is payable due to my Retirement or Termination of Employment, I hereby elect to receive such benefits under the Plan in the form of:

a single lump sum payment

annual installments over a period of years [Note, cannot exceed 15 years] .

Tax Impact

I understand that I (and not the Company) am responsible for tax or legal consequences to me or any of my Beneficiaries resulting from the terms or operation of this Plan. Payments to me from the Plan will be subject to applicable income and employment taxes and withholding, at or before the time paid.

I specifically acknowledge that:

(i)		as a result of the amendment and restatement of the Plan, I will incur FICA tax liabilities as of December 31, 2008 or, if later, the time I am vested in my rights under the Plan (the “vesting date”);

(ii)		as of my vesting date, the Company may use such portion of my Account as is necessary to satisfy such FICA obligations (and related income tax withholding arising from such deemed distribution); and

(iii)		thereafter, further FICA tax obligations (and related income tax withholding) will be incurred each year that I am an Employee and a Participant in the Plan and receive credits to my account in accordance with the terms of the Plan and this Participation Agreement. I understand the Company will use such portion of my Account as is necessary to satisfy such further FICA and income tax withholding obligations.

Acknowledgements

I acknowledge that (i) I have received a copy of the Plan and a Memorandum Regarding Principal Changes in SERP dated December 12, 2008 explaining the principal revisions to the Plan, (ii) I have reviewed those documents and have had the opportunity to discuss any questions with a representative of Invacare and have received satisfactory answers to those questions and (iii) I have been encouraged by the Company to discuss the terms of the amended Plan with my financial and legal advisors and have been provided sufficient time to do so.

I understand that while the Company presently intends to continue the Plan indefinitely, it specifically reserves the right to revise or amend the Plan at any time in accordance with its terms, including the right to reduce the amount of annual credits and the interest crediting rate at any time on a prospective basis, or to eliminate all future credits, including interest, at any time. Further, I understand that this Participation Agreement will be read and interpreted in accordance with and subject to the terms of the Plan and that any inconsistencies between this Participation Agreement and the Plan will be resolved in favor of the Plan. All terms used in this Participation Agreement shall have the same meaning as under the Plan.

Signed this day of December, 2008.


		PARTICIPANT:





		Print Name

ACKNOWLEDGED FOR THE COMPANY:

By:

Its:

Schedule of Participation Agreements with Current Executive Officers



Name	Position	Date of Agreement
A. Malachi Mixon, III	Chairman of the Board of Directors and Chief Executive Officer	December 31, 2008

Gerald B. Blouch	President and Chief Operating Officer	December 31, 2008

Robert K. Gudbranson	Senior Vice President - Chief Financial Officer	December 31, 2008

Joseph B. Richey, II	President - Invacare Technologies Division and Senior Vice President - Electronics and Design Engineering	December 31, 2008

Louis F. J. Slangen	Senior Vice President - Global Market Development	December 31, 2008

Joseph S. Usaj	Senior Vice President - Human Resources	December 31, 2008

Anthony C. LaPlaca	Senior Vice President and General Counsel	December 31, 2008

Exhibit 10.3

AGREEMENT

This AGREEMENT (“Agreement”), is made as of the 31st day of December, 2008, between INVACARE CORPORATION, an Ohio corporation (“Invacare”), and (the “Executive”).

Invacare previously has entered into an agreement with Executive that is similar to this Agreement in recognition of the importance of the Executive’s services to the continuity of management of Invacare and based upon its determination that it will be in the best interests of Invacare to encourage the Executive’s continued attention and dedication to the Executive’s duties in the potentially disruptive circumstances of a possible Change of Control of Invacare. (As used in this Agreement, the term “Change of Control” and certain other capitalized terms have the meanings ascribed to them in Section 10 hereof.)

Invacare has determined that it is necessary to amend and restate such previous agreement with Executive based on certain changes to the existing Change of Control Agreements between Invacare and certain of its executive officers, including Executive, that were reviewed and approved by the Compensation, Management Development and Corporate Governance Committee of Invacare including, without limitation, revisions intended to comply with Internal Revenue Code Section 409A.

Invacare and the Executive agree, effective as of the date first set forth above (the “Effective Date”), as follows:

1. Additional Payment if Executive is Employed by Invacare on First Anniversary of the Date of a Change of Control or if Employment is Terminated in Certain Circumstances Within One Year of a Change of Control . If, following the occurrence of a Change of Control, either (i) the Executive continues to be employed by Invacare or one of its Affiliates on the first anniversary of the date of the Change of Control, or (ii) the Executive’s employment with Invacare is terminated by Invacare for any reason other than Cause, Disability, or death, or is terminated by the Executive for Good Reason, within one year after the Change of Control, then Invacare shall pay to the Executive, within ten business days after the earlier of such events, a lump-sum amount equal to the sum of (a) the Executive’s Annual Base Salary plus (b) the Executive’s Target Bonus.

2. Severance Benefits if Employment is Terminated in Certain Circumstances Within Three Years of a Change of Control . If, within three years following the occurrence of a Change of Control, the Executive’s employment with Invacare is terminated by Invacare for any reason other than Cause, Disability, or death, or is terminated by the Executive for Good Reason, then the provisions of this Section 2 shall become applicable in all respects and Invacare shall pay to the Executive, in addition to any amount paid or payable pursuant to Section 1 above, the amounts specified in Sections 2.1, 2.2, 2.3, 2.4, and 2.5 on the dates indicated therein, shall provide to the Executive the benefits specified in Section 2.6 for the periods specified

therein, and shall cause certain rights of the Executive (or his or her Beneficiary (or Beneficiaries), as applicable) to vest as provided in Sections 2.7, 2.8, 2.9, and 2.10:

2.1 Lump Sum Severance Benefit . Invacare shall pay to the Executive, within ten business days after the Termination Date, a lump sum severance benefit equal to two times the sum of (i) the Executive’s Annual Base Salary plus (ii) the Executive’s Target Bonus.

2.2 Invacare Retirement Savings Plan . Invacare shall pay to the Executive, within 60 days after the Termination Date, a lump sum amount equal to three times the highest amount of total contributions (including both matching contributions and other employer contributions) made by Invacare to the Invacare Retirement Savings Plan (or related successor plan or plans) with respect to the Executive for any single plan year ending on or after the date that is three years before the date of the Change of Control. In the event the Executive is not fully vested under the Invacare Retirement Savings Plan as of the Termination Date, the lump sum amount payable under this Section 2.2 shall be increased to include an amount equal to the non-vested portion of the Executive’s account under the Invacare Retirement Savings Plan.

2.3 401(k) Plus Plan . Invacare shall pay to the Executive, within 60 days after the Termination Date, a lump sum amount equal to three times the highest amount of the employer contributions (including both matching contributions and other employer contributions) credited to the Invacare 401(k) Plus Benefit Equalization Plan (or related successor plan or plans) (the “401(k) Plus Plan”) for the benefit of the Executive for any single plan year ending on or after the date that is three years before the date of the Change of Control.

2.4 Deferred Compensation Plus Plan . Invacare shall pay to the Executive, within 60 days after the Termination Date, a lump sum amount equal to three times the highest amount of the employer contributions (including both matching contributions and other employer contributions) credited to the Invacare Deferred Compensation Plus Plan (or related successor plan or plans) for the benefit of the Executive for any single plan year ending on or after the date that is three years before the date of the Change of Control.

2.5 SERP . Invacare shall pay to the Executive, within 60 days after the Termination Date, a lump sum amount equal to the sum of the contributions and credited interest which were scheduled to be added to Executive’s account under the Invacare Cash Balance Supplemental Executive Retirement Plan (or related successor plan or plans), during the three year period immediately following the Termination Date (including prorated amounts, as applicable), if Executive had continued in the employ of Invacare through the third anniversary of the Termination Date, all as reflected on the attachment to the participation agreement executed by the Executive in connection with such plan

2.6 Insurance Benefits . Invacare shall provide to the Executive, from the Termination Date through the third anniversary of the Termination Date, continuing coverage under health, life, and disability insurance programs at least equal in all respects to the highest level of such coverage provided by Invacare to the Executive at any time during the period beginning one year before the Change of Control and ending on the Termination Date.

2.7 Stock Options and Restricted Stock . In respect of all options to purchase Invacare stock and all shares of restricted stock that have been granted to the Executive pursuant to any stock option or restricted stock agreement, plan or arrangement sponsored by Invacare and which remain outstanding as of the Termination Date, and notwithstanding any other provision to the contrary contained in any stock option or restricted stock agreement, plan or arrangement, Invacare shall:

(a) with respect to all options, cause such options:

	(i)		to become exercisable in full as of the Termination Date;

	(ii)		to continue to be exercisable until the earlier to occur of the second anniversary of the Termination Date or the expiration date of the option;

	(iii)		to be exercisable (and/or to be eligible to satisfy any tax withholding requirements in connection with the exercise of the options) using shares of Invacare common stock previously owned by the Executive and/or shares subject to the options being exercised as consideration in lieu of a cash payment or other arrangement, but only to the extent that any such exercise of the option (and/or withholding tax payments) would not result in Invacare being required to take an additional charge in respect of such exercise in determining and reporting its net income for financial accounting purposes; and

(b) with respect to all restricted stock, cause such restricted stock:

	(i)		to become vested in full as of the Termination Date; and

	(ii)		to be eligible to satisfy any tax withholding requirements in connection with such vesting of the restricted stock using shares of Invacare common stock previously owned by the Executive and/or shares of restricted stock that become so vested as consideration (in lieu of a cash payment or other

arrangement) for the payment of withholding tax, but only to the extent that any such withholding tax payments would not result in Invacare being required to take an additional charge in respect of such accelerated vesting or withholding tax payment in determining and reporting its net income for financial accounting purposes.

2.8 Vesting of Certain Rights . Invacare shall cause the Executive’s rights under (a) the Invacare 401(k) Plus Plan, (b the Invacare Deferred Compensation Plus Plan and (c) the Invacare Cash Balance Supplemental Executive Retirement Plan, to become, as of the Termination Date, immediately vested in full.

2.9 Death of the Executive . In the event of the Executive’s death at any time after the Termination Date through the third anniversary of the Termination Date, then, assuming the Executive was, as of such time, entitled to receive payments and/or benefits pursuant to Sections 1 and/or 2 of this Agreement:

(a) the amounts described in Sections 1, 2.1, 2.2, 2.3, 2.4, and 2.5, to the extent not paid to the Executive, shall be paid to the Beneficiary as soon as practicable following the Executive’s death;

(b) any person who would have been entitled to coverage as the Executive’s dependent (or otherwise because of the Executive’s coverage) under any health insurance program maintained by Invacare (as described in Section 2.6) shall continue to be provided with such coverage as though the Executive had survived through the third anniversary of the Termination Date;

(c) such persons as may be entitled thereto shall receive such benefits as may be provided under any Employee Benefit Plans in accordance with the terms of such Employee Benefit Plans;

(d) such persons as may be entitled thereto shall receive such benefits as may be provided under any other agreement the Executive may have with Invacare or an Affiliate including, without limitation, any agreement relating to options to purchase Invacare stock.

2.10 Alternate Form of Benefit . Notwithstanding the preceding provisions of this Section 2, to the extent the Executive cannot, as a matter of law, or pursuant to the customs or policies of any insurance underwriter or the terms of any benefit plan, realize any benefit or advantage described above in this Section 2 (and especially Section 2.6), or if Invacare reasonably believes that providing the Executive with any such benefit or advantage would be economically disadvantageous because doing so would cause Invacare to lose tax or other

benefits or would cause Executive to incur additional taxes or lose other benefits, Invacare shall notify the Executive and shall pay to the Executive an additional amount or provide a comparable benefit which shall, taking account of any federal, state and local income taxes incurred by the Executive in respect of such payments or benefits, place the Executive in the same, or substantially the same, position, on an after-tax basis, as though he had realized such benefit or advantage; provided , that the amount of any payment to the Executive pursuant to the preceding clause shall be calculated at Invacare’s cost and expense by the Accounting Firm, and its determination of such amount shall be final and binding upon both the Executive and Invacare, and the Executive and Invacare shall each provide the Accounting Firm with such information as it may reasonably request in order to calculate any such amount; provided further , that in no event shall any such additional amount or comparable benefit be provided to the Executive prior to or materially after the time the original payment or benefit would have been provided.

2.11 Later Time for Payment on Account of Termination . Notwithstanding the preceding provisions of Sections 1 and 2, solely to the extent required to comply with applicable provisions of Internal Revenue Code Section 409A (“Section 409A”) with respect to any amounts or benefits not exempt from 409A, payments made pursuant to Sections 1 (ii), 2.1, 2.2, 2.3, 2.4, 2.5 and 2.6 on account of the Executive’s termination of employment shall: (a) not commence until the date that is six months and a day following the Termination Date; and (b) upon commencement, include along with the initial payment an amount sufficient to reimburse the Executive for reasonable lost interest at a rate of 6% per annum, compounded annually, incurred during the period commencing on the date which is 60 days after the Termination Date through the date of payment by Invacare. In the event that Invacare, in the exercise of its reasonable discretion, determines that a delay in payments under this Section 2.11 is required in order to comply with Code Section 409A, Invacare shall, within two business days after the Termination Date, deposit the entire amount due and to become due under Sections 1(ii) and 2, in the trust established by Invacare with Wachovia Bank of North Carolina, N.A. pursuant to a Benefit Security Trust Agreement dated August 21, 1996, as such agreement may be amended from time to time in accordance with its terms. Payments to the Executive from such trust shall thereafter be made in accordance with this Section 2.11; provided, however, that Invacare shall remain fully obligated to the Executive for the full and complete satisfaction of its liabilities and obligations under this Agreement.

3. Excess Parachute Payment Gross-Up; Section 409A Gross-Up .

3.1 Potential for Excess Parachute Payments and for Section 409A Liability . Invacare and the Executive acknowledge that, upon or following a Change of Control, one or more payments or distributions or acceleration or alteration of rights or benefits to be made by Invacare to or for the benefit of the

Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement, under some other plan, agreement, or arrangement, or otherwise) (a “Payment”) may be determined to be an “excess parachute payment” that is not deductible by Invacare for Federal income tax purposes and with respect to which the Executive will be subject to an excise tax, penalties or interest because of Sections 280G and 4999, respectively, of the Internal Revenue Code. Invacare and the Executive also acknowledge that, upon or following a Change of Control, one or more Payments may be determined to give rise to liability on the part of the Executive for accelerated or additional tax (or interest or penalties) under Section 409A of the Internal Revenue Code. If benefits become payable to the Executive under Sections 1 or 2 of this Agreement, the Accounting Firm, which shall make all determinations required to be made under this Section 3, shall determine whether any Payment would be an excess parachute payment and whether any Payment would give rise to Section 409A liability on the part of the Executive. The Accounting Firm shall communicate its determination, together with detailed supporting calculations, to Invacare and to the Executive within 30 days after the Termination Date or such earlier time as is requested by Invacare. Invacare and the Executive shall cooperate with each other and the Accounting Firm and shall provide necessary information so that the Accounting Firm may make all such determinations. Invacare shall pay all of the fees of the Accounting Firm for services performed by the Accounting Firm as contemplated in this Section 3.

3.2 Excess Parachute Payment Gross-Up . If any Payment gives rise, directly or indirectly, to liability on the part of the Executive for excise tax, penalties or interest as a result of Section 4999 of the Internal Revenue Code, Invacare shall make additional cash payments to the Executive, from time to time and at the same time, as any Payment constituting an excess parachute payment is paid or provided to the Executive (or as soon thereafter as is practicable and, in any event, no later than March 15 of the calendar year which follows the calendar year in which the excess parachute payment was made or provided to the Executive), in such amounts as are necessary to put the Executive in the same position, after payment of all federal, state, and local taxes (whether income taxes, excise taxes under Section 4999 of the Internal Revenue Code or otherwise, or other taxes) and payment of penalties and interest arising as a result of Section 4999 of the Internal Revenue Code, as the Executive would have been in after payment of all federal, state, and local income taxes if the Payments had not given rise to an excise tax, penalties or interest as a result of Section 4999 of the Internal Revenue Code.

3.3 Section 409A Gross-Up . If any Payment gives rise, directly or indirectly, to liability on the part of the Executive for tax, penalties or interest as a result of 409A, Invacare shall make additional cash payments to the Executive, from time to time and at the same time, as any Payment giving rise to such liability is paid or provided to the Executive (or as soon thereafter as is practicable and, in any event, no later than March 15 of the calendar year which follows the calendar year in which the Payment giving rise to Section 409A liability was

made or provided to the Executive), in such amounts as are necessary to put the Executive in the same position, after payment of all federal, state, and local taxes (whether income taxes, excise taxes under 409A or otherwise, or other taxes) and interest and penalties, as the Executive would have been in after payment of all federal, state, and local income taxes if the Payments had not given rise to excise taxes, penalties or interest under 409A; provided , however, that in no event shall Invacare be required to make additional cash payments under this Section 3.3 if the Accounting Firm determines that doing so would result in a windfall to the Executive due to duplicative gross-up provisions in this Agreement or in any other binding arrangement.

4. Other Benefits .

4.1 Reimbursement of Certain Expenses After a Change of Control . Invacare shall pay, as incurred (in no event later than the end of the Executive’s taxable year following the year in which such expenses were incurred), all expenses incurred by the Executive at any time during the longer of 20 years or the Executive’s lifetime, including the reasonable fees of counsel engaged by the Executive, in respect of enforcing the Executive’s rights hereunder and/or defending any action brought to have this Agreement declared invalid or unenforceable.

4.2 Sick Leave Pay for Executive . If, after a Change of Control and prior to the Termination Date, the Executive is unable to perform services for Invacare for any period by reason of accidental bodily injury or sickness, Invacare will pay and provide to the Executive, as sick leave pay, all compensation and benefits to which the Executive would have been entitled had the Executive continued to be actively employed by Invacare through the earliest of the following dates (the “Sick Leave Period”): (a) the first date on which the Executive is again capable of performing services for Invacare consistent with past practice , or (b) the date on which the Executive’s employment is terminated by Invacare by reason of Disability or otherwise, or (c) the date on which Invacare has paid and provided 29 months of compensation and benefits to the Executive during the period of the Executive’s incapacity, or (d) the date of the Executive’s death. Notwithstanding the foregoing, the Sick Leave Period may not be greater than 6 months unless the Executive’s injury or sickness can be expected to result in death or can be expected to last for a continuous period of not less than 6 months, and such injury or sickness renders the Executive unable to perform the duties of his position of employment or any substantially similar position of employment. The foregoing sick leave pay is intended to compensate Executive for compensation and benefits that he otherwise would have earned during the Sick Leave Period, and shall not reduce or otherwise have any effect on Executive’s rights to receive any other compensation, benefits or other Payments hereunder for any other reason, including as may be owed arising out of cessation of Executive’s employment.

5. No Set-Off; No Obligation to Seek Other Employment or to Otherwise Mitigate Damages; No Effect Upon Other Plans . Invacare’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense, or other claim whatsoever which Invacare may have against the Executive. The Executive shall not be required to mitigate damages or the amount of any payment provided for under this Agreement by seeking other employment or otherwise. The amount of any payment provided for under this Agreement shall not be reduced by any compensation or benefits earned by the Executive as the result of employment by another employer or otherwise after the termination of the Executive’s employment.

6. Taxes; Withholding of Taxes . Without limiting the right of Invacare to withhold taxes pursuant to this Section 6, the Executive shall be responsible (after taking into account all payments to be made by Invacare to or on behalf of the Executive under Sections 1 or 2 hereof, and any gross-ups required under Section 3 hereof) for all income, excise, and other taxes (federal, state, city, or other) imposed on or incurred by the Executive as a result of receiving the payments provided in this Agreement, including, without limitation, the payments provided under Sections 1 or 2 of this Agreement. Subject to Section 3.1 hereof, Invacare may withhold from any amounts payable under this Agreement all federal, state, city, or other taxes as Invacare shall determine to be required pursuant to any law or government regulation or ruling. Without limiting the generality of the foregoing, Invacare may withhold from any amount payable under this Agreement amounts sufficient to satisfy any withholding requirements that may arise out of any benefit provided to or in respect of the Executive by Invacare under Section 2 of this Agreement.

7. Term of this Agreement . This Agreement shall be effective as of the date first above written and shall thereafter apply to any Change of Control occurring on or before December 31, 2009 or during any succeeding applicable term, and on December 31, 2009 and on December 31 of each succeeding year thereafter (a “Renewal Date”), the term of this Agreement, if not previously terminated, shall be automatically extended for an additional year unless either party has given notice to the other, at least one year in advance of that Renewal Date, that the Agreement shall not apply to any Change of Control occurring after that Renewal Date.

7.1 Termination of Agreement Upon Termination of Employment Before a Change of Control . This Agreement shall automatically terminate on the first date occurring before a Change of Control on which the Executive is no longer employed by Invacare, except that, for purposes of this Agreement, any involuntary termination of employment of the Executive or any termination by the Executive for Good Reason that is effected within 6 months before a Change in Control and primarily in contemplation of a Change of Control that actually occurs after the date of the termination shall be deemed to be a termination of the Executive’s employment as of the date immediately after that Change of Control, and in such case, the Change in Control shall constitute the date as of which the Executive’s right to payment hereunder shall become vested.

7.2 No Termination of Agreement During Three Year Period Beginning on Date of a Change of Control . After a Change of Control, this Agreement may not be terminated. However, if the Executive’s employment with Invacare continues for more than three years following the occurrence of a Change of Control, then, for all purposes of this Agreement other than Sections 1 and 4.1, that particular Change of Control shall thereafter be treated for purposes of this Agreement as if it never occurred; provided, however, that the foregoing shall not deprive Executive of any rights, benefits or payments (or allow Invacare to avoid any obligations) that were or became vested under this or any other agreement, plan or arrangement.

8. Internal Revenue Code Section 409A . This Agreement is intended to meet the requirements for exemption from (or to the extent not exempt, compliance with) Section 409A (including without limitation, the exemptions for short-term deferrals and separation pay arrangements), and this Agreement shall be so construed and administered. Notwithstanding anything in this Agreement to the contrary, at any time prior to a Change in Control, Invacare may unilaterally amend this Agreement, retroactively or prospectively, while maintaining the spirit of this Agreement and after consultation with Executive, to secure exemption from (or, to the extent not exempt, to ensure compliance with), the requirements of 409A and to avoid adverse tax consequences to Executive thereunder. Furthermore, at any time prior to a Change in Control, the Executive agrees to execute such further instruments and take such further action as may be necessary to comply with 409A or to avoid adverse tax consequences to Executive thereunder.

9. Miscellaneous .

9.1 Successor to Invacare . In the event that

	(a)		Invacare transfers all or substantially all of its assets to another corporation or entity; or

	(b)		(i) Invacare consolidates with or merges with or into any other corporation or entity and

			(ii) either (x) Invacare is not the surviving corporation or entity of such consolidation or merger or (y) Invacare is the surviving corporation or entity of such consolidation or merger but the shareholders of Invacare immediately prior to the consummation of such merger or consolidation do not own securities representing a majority of the outstanding voting power of such surviving corporation or entity or its parent after the consummation of the consolidation or merger,

then, in any of such events, the entity surviving such consolidation or merger and each Affiliate thereof having an individual net worth of $5 million or more shall assume joint and several liability for this Agreement in a signed writing and

deliver a copy thereof to the Executive. Upon such assumption, the successor corporation or entity and each Affiliate thereof having an individual net worth of $5 million or more shall become obligated to perform the obligations of Invacare under this Agreement and the term “Invacare” as used in this Agreement shall be deemed to refer to such successor entity and such Affiliates jointly and severally. Any failure of Invacare to obtain the written agreement of such successor or surviving entity (including a parent successor entity) and the required Affiliates to assume this Agreement before the effectiveness of any such succession shall be deemed to be a material breach of this Agreement.

9.2 Notices . Notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered in person or by confirmed facsimile transmission (to the Senior Vice President of Human Resources of Invacare in the case of notices to Invacare and to the Executive in the case of notices to the Executive) or mailed by United States registered mail, return receipt requested, postage prepaid, addressed as follows:

If to Invacare:

Invacare Corporation
One Invacare Way
Elyria, OH 44035
Attention: Senior Vice President of Human Resources

If to the Executive:

or such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.

9.3 Employment Rights . Nothing expressed or implied in this Agreement shall create any right or duty on the part of Invacare or the Executive to have the Executive continue as an officer of Invacare or an Affiliate of Invacare or to remain in the employment of Invacare or an Affiliate of Invacare.

9.4 Administration . Invacare shall be responsible for the general administration of this Agreement and for making payments under this Agreement. All fees and expenses billed by the Accounting Firm for services contemplated under this Agreement shall be the responsibility of Invacare.

9.5 Source of Payments . Any payment specified in this Agreement to be made by Invacare may be made directly by Invacare solely from its general

assets, and the Executive shall have the rights of an unsecured general creditor of Invacare with respect thereto.

9.6 Validity . The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement which shall remain in full force and effect.

9.7 Modification; Waiver. No provision of this Agreement may be modified, waived, or discharged unless such waiver, modification, or discharge is agreed to in a writing signed by the Executive and Invacare. No waiver by either party hereto at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same time or at any prior or subsequent time.

9.8 Entire Agreement; Supercession. Except as otherwise specifically provided herein, this Agreement, including its attachments, contains the entire agreement between the parties concerning the subject matter hereof and incorporates and supersedes any and all prior discussions or agreements, written or oral, the parties may have had with respect to such subject matter, including without limitation that certain change of control agreement previously entered into by Invacare and the Executive, which is hereby amended and restated in its entirety; provided , however, that except as expressly provided otherwise herein, nothing in this Agreement shall affect any rights the Executive or anyone claiming through the Executive may have in respect of either (a) any Employee Benefit Plan which provides benefits to or in respect of the Executive or (b) any other agreements the Executive may have with Invacare or an Affiliate of Invacare, including without limitation any employment or severance protection agreements the Executive may have with Invacare or an Affiliate of Invacare.

9.9 Post-Mortem Payments; Designation of Beneficiary . As indicated in Section 2.9, in the event that, following the termination of the Executive’s employment with Invacare, the Executive is entitled to receive any payments pursuant to this Agreement and the Executive dies, such payments shall be made to the Executive’s Beneficiary designated hereunder. At any time after the execution of this Agreement, the Executive may prepare, execute, and file with the Secretary of Invacare a copy of the Designation of Beneficiary form attached to this Agreement as Exhibit A. The Executive shall thereafter be free to amend, alter or change such form; provided , however, that any such amendment, alteration or change shall be made by filing a new Designation of Beneficiary form with the Secretary or the Senior Vice President of Human Resources of Invacare. In the event the Executive fails to designate a beneficiary, following the death of the Executive, all payments of the amounts specified by this Agreement which would have been paid to the Executive’s designated beneficiary pursuant to this Agreement shall instead be paid to the Executive’s spouse, if any, if she survives the Executive or, if there is no spouse or she does not survive the Executive, to the Executive’s estate.

9.10 Service with Affiliates . Any services the Executive performs for an Affiliate of Invacare shall be deemed performed for Invacare. Any transfer of the Executive’s employment from Invacare to an Affiliate of Invacare, or from an Affiliate of Invacare to Invacare, or from an Affiliate of Invacare to another Affiliate of Invacare shall be deemed not to constitute a termination of the Executive’s employment with Invacare.

9.11 Time Periods . Any action required to be taken under this Agreement within a certain number of days shall be taken within that number of calendar days; provided , however, that if the last day for taking such action falls on a weekend or a holiday, the period during which such action may be taken shall be automatically extended to the next business day. If the day for taking any action under this Agreement falls on a weekend or a holiday, such action may be taken on the next business day. Notwithstanding the foregoing, no such extension shall permit an action to be taken at a time that would cause an exempt payment to become subject to Section 409A or to cause a payment that would otherwise be compliant with Section 409A to cease to be so compliant.

9.12 Incorporation by Reference . The incorporation herein of any terms by reference to another document shall not be affected by the termination of any agreement set forth in such other document or the invalidity of any provisions thereof.

9.13 Binding Effect; Construction of Agreement . This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal representatives, executors, administrators, successors, heirs, and designees (including, without limitation, the Beneficiary). Upon the Executive’s death, for purposes of this Agreement, the term “Executive” shall be deemed to include, as applicable, any person (including, without limitation, the Beneficiary) who is entitled to benefits under this Agreement following the Executive’s death.

9.14 Governing Law . All questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Ohio, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Ohio or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Ohio.

9.15 Representations and Warranties of Invacare . Invacare represents and warrants to the Executive that (i) Invacare is a corporation duly organized, validly existing, and in good standing under the laws of the State of Ohio; (ii) Invacare has the power and authority to enter into and carry out this Agreement, and there exists no contractual or other restriction upon its so doing; (iii) Invacare has taken such corporate action as is necessary or appropriate to enable it to enter into and perform its obligations under this Agreement; and (iv) this Agreement constitutes the legal, valid and binding obligation of Invacare, enforceable against Invacare in accordance with its terms.

9.16 Gender . The use of the feminine, masculine or neuter pronoun shall not be restrictive as to gender and shall be interpreted in all cases as the context may require.

10. Definitions .

10.1 Accounting Firm . The term “Accounting Firm” means the independent auditors of Invacare for the fiscal year preceding the year in which the Change of Control occurred and such firm’s successor or successors; provided, however, if such firm is unable or unwilling to serve and perform in the capacity contemplated by this Agreement, Invacare shall select another national accounting firm of recognized standing to serve and perform in that capacity under this Agreement, except that such other accounting firm shall not be the then independent auditors for Invacare or any of its Affiliates.

10.2 Affiliate . The term “Affiliate” shall mean, with respect to any person or entity, any other person or entity which controls, is controlled by, or is under common control with such person or entity within the meaning of Section 414(b) or (c) of the Internal Revenue Code.

10.3 Annual Base Salary . “Annual Base Salary” means the highest annual rate of base salary payable by Invacare to the Executive at any time between the Effective Date and the Termination Date.

10.4 Beneficiary . “Beneficiary” means the person designated by the Executive as his beneficiary pursuant to Section 9.9 or such other person as determined pursuant to Section 9.9 hereof.

10.5 Cause . The employment of the Executive by Invacare shall have been terminated for “Cause” if, after a Change of Control and prior to the termination of employment, any of the following has occurred:

(a) the Executive shall have been convicted of a felony,

(b) the Executive commits an act or series of acts of dishonesty in the course of the Executive’s employment which are materially inimical to the best interests of Invacare and which constitutes the commission of a felony, all as determined by the vote of three-fourths of all of the members of the Board of Directors of Invacare (other than the Executive, if the Executive is a Director of Invacare), which determination is confirmed by a panel of three arbitrators appointed and acting in accordance with the rules of the American Arbitration Association for the purpose of reviewing that determination,

(c) any federal or state regulatory agency with jurisdiction over Invacare has issued a final order, with no further right of appeal, that has the effect of suspending, removing, or barring the Executive from continuing his service as an officer or director of Invacare, or

(d) after being notified in writing by the Board of Directors of Invacare to cease any particular Competitive Activity, the Executive shall intentionally continue to engage in such Competitive Activity more than thirty (30) days after receipt of such notice while the Executive remains in the employ of Invacare.

10.6 Change of Control . A “Change of Control” shall be deemed to have occurred at the first time on which, after the Effective Date:

(a) There is a report filed on Schedule 13D or Schedule 14D-1 (or any successor schedule, form, or report), each as adopted under the Securities Exchange Act of 1934, as amended, disclosing the acquisition, in a transaction or series of transactions, by any person (as the term “person” is used in Section 13(d) and Section 14(d)(2) of the Securities Exchange Act of 1934, as amended), other than (1) A. Malachi Mixon and/or any Affiliate of A. Malachi Mixon, (2) Invacare or any of its subsidiaries, (3) any employee benefit plan or employee stock ownership plan or related trust of Invacare or any of its subsidiaries, or (4) any person or entity organized, appointed or established by Invacare or any of its subisidiaries for or pursuant to the terms of any such plan or trust, of such number of shares of Invacare as entitles that person to exercise 30% or more of the voting power of Invacare in the election of Directors; or

(b) During any period of 24 consecutive calendar months, individuals who at the beginning of such period constitute the Directors of Invacare cease for any reason to constitute at least a majority of the Directors of Invacare unless the election of each new Director of Invacare (over such period) was approved or recommended by the vote of at least two-thirds of the Directors of Invacare then still in office who were Directors of Invacare at the beginning of the period; or

(c) There is a merger, consolidation, combination (as defined in Section 1701.01(Q), Ohio Revised Code), majority share acquisition (as defined in Section 1701.01(R), Ohio Revised Code), or control share acquisition (as defined in Section 1701.01(Z)(1), Ohio Revised Code, or in Invacare’s Articles of Incorporation) involving Invacare and, as a result of which, the holders of shares of Invacare prior to the transaction become, by reason of the transaction, the holders of such number of shares of the surviving or acquiring corporation or other entity as entitles them to exercise less than fifty percent (50%) of the voting power of the surviving or acquiring corporation or other entity in the election of Directors; or

(d) There is a sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Invacare, but only if the transferee of the assets in such transaction is not a subsidiary of Invacare; or

(e) The shareholders of Invacare approve any plan or proposal for the liquidation or dissolution of Invacare, but only if the transferee of the assets of Invacare in such liquidation or dissolution is not a subsidiary of Invacare.

If an event described in any of Clauses (a), (b), (c), (d), and (e) occurs, a Change of Control shall be deemed to have occurred for all purposes of this Agreement and, except as provided in the last sentence of Section 7.2, that Change of Control shall be irrevocable.

10.7 Competitive Activity . The Executive shall be deemed to have engaged in “Competitive Activity” if the Executive engages in any business or business activity (other than as a director, officer, or employee of Invacare) in which Invacare engages as of the time of the notice provided in Section 10.5(d).

10.8 Demotion or Removal . The Executive shall be deemed to have been subjected to “Demotion or Removal” if, during the three year period commencing on the date of a Change of Control, other than by Voluntary Resignation or with the Executive’s written consent, the Executive ceases to hold the highest position held by him at any time during the one year period ending on the date of the Change of Control with all of the duties, authority, and responsibilities of that office as in effect at any time during the one year period ending on the date of the Change of Control.

10.9 Disability . For purposes of this Agreement, the Executive’s employment will have been terminated by Invacare by reason of “Disability” of the Executive only if (a) as a result of accidental bodily injury or sickness, the Executive has been unable to perform his normal duties for Invacare for a period of 180 consecutive days, and (b) the Executive begins to receive payments under the executive long term disability plan or its successor plan(s) sponsored by Invacare not later than 30 days after the Termination Date.

10.10 Employee Benefit Plan . “Employee Benefit Plan” means any plan or arrangement defined as such in 29 U.S.C. §1002 which provides benefits to the employees of Invacare or its Affiliates.

10.11 Good Reason . The Executive shall have “Good Reason” to terminate his employment under this Agreement if, at any time after a Change of Control has occurred and before the third anniversary of that Change of Control, one or more of the events listed in (a) through (f) of this Section 10.11 occurs and, based on that event, the Executive gives notice of such event (and of his intention to terminate his employment if Invacare does not cure such condition(s)) on a date that is both (i) within 90 days of the occurrence of that event and (ii) not later than the third anniversary of that Change of Control, and Invacare does not cure the condition(s) constituting the event within 30 days after such notice:

(a) The Executive is subjected to a Demotion or Removal involving a material diminution in the Executive’s authority, duties, or responsibilities or in those of the individual to whom the Executive is required to report; or

(b) The Executive’s Annual Base Salary is materially reduced (which for this purposes shall be deemed to occur if the reduction is five percent (5%) or greater); or

(c) The Executive’s opportunity for incentive compensation is materially reduced from the level of his opportunity for incentive compensation as in effect immediately before the date of the Change of Control or from time to time thereafter (which for this purposes shall be deemed to occur if the reduction is equivalent to a five percent (5%) or greater reduction in Executive’s Annual Base Salary); or

(d) The Executive is excluded (other than by his volitional action(s)) from full participation in any benefit plan or arrangement maintained for senior executives of Invacare generally, and such exclusion materially reduces the benefits provided to the Executive; or

(e) The Executive’s principal place of employment for Invacare is relocated a material distance (which for this purpose shall be deemed to be more than 35 miles) from One Invacare Way, Elyria, Ohio; or

(f) Any other action or inaction that constitutes a material breach by Invacare of this Agreement or any other agreement under which the Executive provides his services to Invacare.

10.12 Internal Revenue Code . A reference to any provision of the Internal Revenue Code means that provision of the Internal Revenue Code of 1986, as amended, and any successor provision, and any applicable regulations promulgated thereunder.

10.13 Target Bonus . “Target Bonus” means the Executive’s Annual Base Salary multiplied by the higher of (a) the target bonus percentage in effect for the Executive under Invacare’s bonus plan during the fiscal year immediately preceding the fiscal year in which the Change of Control occurs, or (b) the target bonus percentage in effect for the Executive under Invacare’s bonus plan during the fiscal year in which the Change of Control occurs.

10.14 Termination Date . “Termination Date” means the date on which (and related terms, such as “termination of employment” and “terminate employment” mean a situation in which) the Executive incurs a separation from service with Invacare and all of its Affiliates within the meaning of Section 409A. A separation from service under Section 409A includes a quit, discharge, or retirement, or a leave of absence (including military leave, sick leave, or other

bona fide leave of absence such as temporary employment by the government, at the point that such leave exceeds the greater of six months, the period for which the Participant’s right to reemployment is provided either by statute or by contract, or in the case of sick leave, 29 months, if the Executive’s injury or sickness can be expected to result in death or can be expected to last for a continuous period of not less than 6 months, and such injury or sickness renders the Executive unable to perform the duties of his position of employment or any substantially similar position of employment). A separation from service under Section 409A also occurs upon a permanent decrease in service to a level that is no more than twenty percent (20%) of its prior level. For this purpose, whether a separation from service has occurred is determined based on whether it is reasonably anticipated that no further services will be performed by the Executive after a certain date or that the level of bona fide services the Executive will perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period (or the full period of services if the Executive has been providing services less than 36 months).

10.15 Voluntary Resignation . A “Voluntary Resignation” shall have occurred if the Executive terminates his employment with Invacare by voluntarily resigning at his own instance without having been requested to so resign by Invacare, except that any resignation by the Executive will not be deemed to be a Voluntary Resignation if, at the time of that resignation, the Executive had Good Reason to resign.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.


	INVACARE CORPORATION (“Invacare”)
	By
	Joseph S. Usaj, Senior Vice President of
	Human Resources




	(the “Executive”)

Exhibit A

DESIGNATION OF BENEFICIARY


To:		Invacare Corporation Attn: Secretary

I, the undersigned, , am a party to a certain Agreement with Invacare Corporation, an Ohio corporation, dated as of December 31, 2008 (the “Agreement”). Pursuant to the agreement, I have the right to designate a person or persons to receive, in the event of my death, any amounts that might become payable to me under the Agreement. I hereby exercise this right and direct that, upon my death, any amounts payable to me under the Agreement shall be distributed in the proportions set forth below to the following person(s) if he, she or they survive me, namely:


Beneficiary	Relationship	Percent Share

If none of the above-designated person (s) survives me, any amounts payable under the Agreement shall be distributed to .

Any and all previous designations of beneficiary made by me are hereby revoked, and I hereby reserve the right to revoke this designation of beneficiary.


Date:


				(Signature)


				(Print name)

Schedule of Change of Control Agreements with Current Executive Officers


Name	Position	Date of Agreement
A. Malachi Mixon, III	Chairman of the Board of Directors and Chief Executive Officer	December 31, 2008

Gerald B. Blouch	President and Chief Operating Officer	December 31, 2008

Robert K. Gudbranson	Senior Vice President — Chief Financial Officer	December 31, 2008

Joseph B. Richey, II	President — Invacare Technologies Division and Senior Vice President - Electronics and Design Engineering	December 31, 2008

Louis F. J. Slangen	Senior Vice President — Global Market Development	December 31, 2008

Joseph S. Usaj	Senior Vice President — Human Resources	December 31, 2008

Anthony C. LaPlaca	Senior Vice President and General Counsel	December 31, 2008

Exhibit 10.4

INVACARE CORPORATION

DEFERRED COMPENSATION PLUS PLAN

INVACARE CORPORATION
DEFERRED COMPENSATION PLUS PLAN
(Effective January 1, 2005)

Table of Contents


	Page

ARTICLE I		1

INTRODUCTION		1
1.1 Name of Plan		1
1.2 Purposes of Plan		1
1.3 “Top Hat” Pension Benefit Plan		1
1.4 Plan Unfunded		1
1.5 Effective Date		1
1.6 Administration		2

ARTICLE II		3

DEFINITIONS AND CONSTRUCTION		3
2.1 Definitions		3
2.2 Number and Gender		9
2.3 Headings		9

ARTICLE III		10

PARTICIPATION AND ELIGIBILITY		10
3.1 Participation		10
3.2 Commencement of Participation		10
3.3 Cessation of Active Participation		10
3.4 Protective Measures		10

ARTICLE IV		11

CONTRIBUTIONS AND VESTING		11
4.1 Deferrals by Participants		11
4.2 Effective Date of Participation and Deferral Election Form		12
4.3 Modification or Revocation of Election by Participant		12
4.4 Matching Contributions		12
4.5 Make Whole IQC Contributions		12
4.6 Discretionary Contributions		12
4.7 Suspension of Contributions		13
4.8 Vesting		13
4.9 Suspension and Forfeiture Following Accelerated Distribution of Grandfathered Deferrals		13

ARTICLE V		14

ACCOUNTS		14
5.1 Establishment of Bookkeeping Accounts		14
5.2 Subaccounts		14
5.3 Earnings Elections		14
5.4 Hypothetical Accounts and Creditor Status of Participants		15
5.5 Investments		15

ARTICLE VI		16

PAYMENT OF ACCOUNT		16
6.1 Timing of Distribution of Accounts		16


	Page

6.2 Adjustment for Investment Gains and Losses Upon a Distribution		16
6.3 Form of Payment		16
6.4 Change in Date or Form of Distribution		17
6.5 Transition Elections		18
6.6 Designation of Beneficiaries		18
6.7 Change of Beneficiary Designation		18
6.8 No Beneficiary Designation		18
6.9 Withdrawals for Unforeseeable Emergency		19
6.10 Withholding		19

ARTICLE VII		20

ADMINISTRATION		20
7.1 Committee		20
7.2 General Powers of Administration		20
7.3 Indemnification of Committee		21

ARTICLE VIII		22

DETERMINATION OF BENEFITS, CLAIMS PROCEDURE AND ADMINISTRATION		22
8.1 Claims		22
8.2 Claim Decision		22
8.3 Request for Review of a Denied Claim		23
8.4 Review of Decision		23
8.5 Discretionary Authority		24

ARTICLE IX		25

AMENDMENT AND TERMINATION		25
9.1 Power to Amend or Terminate		25
9.2 Distribution Upon Plan Termination		25

ARTICLE X		27

MISCELLANEOUS		27
10.1 Plan Not a Contract of Employment		27
10.2 Non-Assignability of Benefits		27
10.3 Severability		27
10.4 Governing Laws		27
10.5 Binding Effect		27
10.6 Entire Agreement		27
10.7 No Guaranty of Tax Consequences		28

INVACARE CORPORATION
DEFERRED COMPENSATION PLUS PLAN
(Effective January 1, 2005)

ARTICLE I
INTRODUCTION

1.1 Name of Plan.

Invacare Corporation (the “Company”) hereby adopts the Invacare Corporation Deferred Compensation Plus Plan (the “Plan”).

1.2 Purposes of Plan.

The purposes of the Plan are to provide deferred compensation for a select group of management or highly compensated Employees and to provide eligible Employees the opportunity to defer receipt of a portion of Base Salary, Bonus Compensation and/or other compensation.

1.3 “Top Hat” Pension Benefit Plan.

The Plan is an “employee pension benefit plan” within the meaning of ERISA Section 3(2). The Plan is maintained, however, for a select group of management or highly compensated employees and, therefore, is exempt from Parts 2, 3 and 4 of Title 1 of ERISA. The Plan is not intended to qualify under Code Section 401(a).

1.4 Plan Unfunded.

The Plan is unfunded. All benefits will be paid from the general assets of the Company, which will continue to be subject to the claims of the Company’s creditors. No amounts will be set aside for the benefit of Plan Participants or their Beneficiaries.

1.5 Effective Date.

The Company maintains the Invacare Corporation 401(k) Plus Benefit Equalization Plan (“Prior Plan”) which relates to certain deferred compensation amounts which were deferred, earned and vested on or prior to December 31, 2004, plus earnings and losses attributable thereto. Such amounts remain subject to all terms and provisions of the Prior Plan which are not intended to be modified by the terms hereof, or otherwise materially modified, so as to allow such amounts to be exempt from Code Section 409A.

The Company now establishes the Invacare Corporation Deferred Compensation Plus Plan, effective January 1, 2005, which relates to (i) amounts deferred after December 31, 2004, and (ii) any amounts previously deferred under the Prior Plan but which were not vested prior to January 1, 2005 (all liabilities with respect to such amounts being hereby transferred to this Plan), plus earnings and losses attributable thereto. The Plan is effective as of the Effective Date; provided, however, that in general this document reflects the provisions of the Plan in effect for periods on and after January 1, 2009. For the period between the Effective Date and

January 1, 2009, the Plan was operated in good faith compliance with Code Section 409A and applicable transition guidance and relief thereunder (including but not limited to Notice 2007-86), but this document is not intended to fully reflect the operation of the Plan during such period.

1.6 Administration.

The Plan shall be administered by the Committee or its delegates, as set forth in Section 7.1.

ARTICLE II
DEFINITIONS AND CONSTRUCTION

2.1 Definitions.

For purposes of the Plan, the following words and phrases shall have the respective meanings set forth below, unless their context clearly requires a different meaning:

	(a)		“Account” means the bookkeeping account or accounts maintained by the Company to reflect the Participant’s Base Salary Deferrals, Bonus Deferrals, Matching Contributions, IQC Contributions, Discretionary Contributions and Prior Plan Unvested Amounts, together with all earnings, gains and losses thereon. Accounts shall be further denominated as Retirement Accounts or In-Service Distribution Accounts.

	(b)		“Affiliate” means any corporation or business organization during any period during which it would be treated, together with the Company, as a single employer for purposes of Code Sections 414(b) or (c).

	(c)		“Base Salary” means the base rate of cash compensation, including commissions, paid by the Company to or for the benefit of a Participant for services rendered or labor performed while a Participant, including base pay a Participant could have received in cash in lieu of (i) deferrals pursuant to Section 4.1 and (ii) contributions made on his behalf to any qualified plan maintained by the Company or to any cafeteria plan under Code Section 125 maintained by the Company.

	(d)		“Base Salary Deferral” means the amount of a Participant’s Base Salary which the Participant elects to have withheld hereunder and credited to his Account pursuant to Section 4.1.

	(e)		“Beneficiary” means the person or persons designated by the Participant in accordance with Section 6.6 or, in the absence of an effective designation, the person or entity described in Section 6.8.

	(f)		“Board” means the Board of Directors of the Company.

	(g)		“Bonus Compensation” means the amount that is awarded to a Participant for a Plan Year under any bonus arrangement maintained by the Company and is “performance-based compensation” under Code Section 409A.

	(h)		“Bonus Deferral” means the amount of a Participant’s Bonus Compensation which the Participant elects to have withheld hereunder and credited to his Account pursuant to Section 4.1.

(i)

“Change of Control” means the first time on which, after the Effective Date:

	(i)		There is a report filed on Schedule 13D or Schedule 14D-1 (or any successor schedule, form, or report), each as adopted under the Securities Exchange Act of 1934, as amended, disclosing the acquisition, in a transaction or series of transactions, by any person (as the term “person” is used in Section 13(d) and Section 14(d)(2) of the Securities Exchange Act of 1934, as amended), other than (1) A. Malachi Mixon and/or any Affiliate of A. Malachi Mixon, (2) Invacare or any of its subsidiaries, (3) any employee benefit plan or employee stock ownership plan or related trust of Invacare or any of its subsidiaries, or (4) any person or entity organized, appointed or established by Invacare or any of its subsidiaries for or pursuant to the terms of any such plan or trust, of such number of shares of Invacare as entitles that person to exercise 30% or more of the voting power of Invacare in the election of Directors; or

	(ii)		During any period of 24 consecutive calendar months, individuals who at the beginning of such period constitute the Directors of Invacare cease for any reason to constitute at least a majority of the Directors of Invacare unless the election of each new Director of Invacare (over such period) was approved or recommended by the vote of at least two-thirds of the Directors of Invacare then still in office who were Directors of Invacare at the beginning of the period; or

	(iii)		There is a merger, consolidation, combination (as defined in Section 1701.01(Q), Ohio Revised Code), majority share acquisition (as defined in Section 1701.01(R), Ohio Revised Code), or control share acquisition (as defined in Section 1701.01(Z)(1), Ohio Revised Code, or in Invacare’s Articles of Incorporation) involving Invacare and, as a result of which, the holders of shares of Invacare prior to the transaction become, by reason of the transaction, the holders of such number of shares of the surviving or acquiring corporation or other entity as entitles them to exercise less than fifty percent (50%) of the voting power of the surviving or acquiring corporation or other entity in the election of Directors; or

	(iv)		There is a sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of Invacare, but only if the

			transferee of the assets in such transaction is not a subsidiary of Invacare; or
	(v)		The shareholders of Invacare approve any plan or proposal for the liquidation or dissolution of Invacare, but only if the transferee of the assets of Invacare in such liquidation or dissolution is not a subsidiary of Invacare.

			If an event described in any of Clauses (a), (b), (c), (d), and (e) occurs, a Change of Control shall be deemed to have occurred for all purposes of this Agreement and that Change of Control shall be irrevocable.

	(j)		“Code” means the Internal Revenue Code of 1986, as amended. In general, a reference to the Code will include all lawful regulations and pronouncements promulgated thereunder, including without limitation, all applicable transition relief with respect to Code Section 409A.

	(k)		“Committee” means the administrative committee named to administer the Plan pursuant to Section 7.1.

	(l)		“Company” means Invacare Corporation and any successor thereto.

	(m)		“Deferral Period” means the period of time for which a Participant elects to defer receipt of the Base Salary Deferrals and Bonus Deferrals credited to such Participant’s In-Service Account(s).

	(n)		“Directors” means the Board of Directors of the Company.

	(o)		“Disability” means, with respect to any Participant, that such Participant is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, either (i) unable to engage in any substantial gainful activity, or (ii) receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Company. Without limitation, for purpose of this Plan, a Participant will be deemed to have a Disability if the Participant is determined to be totally disabled by the Social Security Administration, or is determined to be disabled in accordance with a disability insurance program of the Company or any Affiliate (provided that the definition of disability applied under such disability insurance program complies with the requirements of Section 409A).

	(p)		“Discretionary Contribution” means the Company’s contribution, if any, made pursuant to Section 4.6.

	(q)		“Effective Date” means January 1, 2005, except where a different date is specifically set forth.

	(r)		“Employee” means any common-law employee of the Company or any Affiliate.

	(s)		“ERISA” means the Employee Retirement Income Security Act of 1974, as amended. In general, a reference to ERISA will include all lawful regulations and pronouncements promulgated thereunder.

	(t)		“401(k) Plan” means the Invacare Retirement Savings Plan, as in effect on January 1, 2005, and as amended from time to time thereafter.

	(u)		“In-Service Distribution Accounts” means an Account(s) to which a Participant’s Base Salary Deferrals and Bonus Deferrals are credited pursuant to the terms of the Plan and the election of a Participant. Each of a Participant’s In-Service Distribution Accounts is distributable in a future calendar year which is not less than two (2) years following the end of the Plan Year in which the deferral of compensation was made and which is selected by the Participant pursuant to Section 4.1 hereof. A Participant may have up to two (2) In-Service Distribution Accounts under the Plan at any one time.

	(v)		“IQC Contributions” means the amount, if any, of Invacare Quarterly Contributions made by the Company under the 401(k) Plan for a Plan Year.

	(w)		“Key Employee” means a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i). For purposes of this Plan, “Key Employees” will be identified on the basis of the 12 month period ending each December 31 and each such identification will apply during the 12 month period commencing on the succeeding April 1.

	(x)		“Make Whole IQC Contribution” means a contribution equal to the Invacare Quarterly Contribution that would have been made to the 401(k) Plan for a Participant but for the limitation on compensation contained in Code Section 401(a)(17).

	(y)		“Matching Contribution” means the matching amount, as determined by the Company each year, that would be credited to the Participant’s Account based on Base Salary Deferrals and

			Bonus Deferrals under the 401(k) Plan if such deferrals had been deferred by the Participant into the 401(k) Plan (but without regard to the limitations of Code Section s 401(a)(17), 415 or other relevant limitations under the Code), reduced by the actual matching contributions made on deferrals under the 401(k) Plan. Any Matching Contribution shall be credited by the Company to the Retirement Account of each Participant at such time or times as the Company determines.

	(z)		“Participant” means each Employee who has been selected for participation in the Plan, who has become a Participant pursuant to Article III and who retains an Account under this Plan.

	(aa)		“Participation and Deferral Election Form” means the written agreement pursuant to which the Participant elects the amount of his Base Salary and/or his Bonus Compensation to be deferred pursuant to the Plan, the Account to which such deferrals are to be credited, the Deferral Period, if applicable, the deemed investment of amounts deferred and the time and form of payment of such amounts and such other matters as the Committee shall determine from time to time.

	(bb)		“Plan” means the Invacare Corporation Deferred Compensation Plus Plan, as in effect on the Effective Date, and as amended from time to time hereafter.

	(cc)		“Plan Year” means the 12-consecutive month period commencing January 1 of each year ending on the following December 31.

	(dd)		“Prior Plan Unvested Amounts” means any unvested amount credited to a Participant’s Account under the Invacare Corporation 401(k) Benefit Equalization Plus Plan as of December 31, 2004 which is transferred to the Participant’s Retirement Account under this Plan on or after the Effective Date.

	(ee)		“Retirement” means a Participant’s Termination of Employment after the attainment of age fifty-five (55) and completion of ten (10) Years of Service or more.

	(ff)		“Retirement Account” means an Account to which Base Salary Deferrals and Bonus Deferrals are credited pursuant to the terms of the Plan and the election of a Participant. A Participant’s Retirement Account shall also be credited with any Matching Contributions, Make Whole IQC Contributions, Profit Sharing Contributions and Discretionary Contributions creditable to a Participant under the terms of the Plan. A Participant’s Retirement Account is generally payable upon his Retirement.

(gg)

“Termination of Employment” means the separation from service of a Participant from the Company and all Affiliates for any reason, which includes:

	(i)		a voluntary resignation;

	(ii)		involuntary discharge for any reason, with or without cause;

	(iii)		Retirement;

	(iv)		death;

	(v)		a leave of absence (including military leave, sick leave, or other bona fide leave of absence) but only at the point that such leave exceeds the greatest of (i) six months, (ii) the period for which the Participant’s right to reemployment is guaranteed either by statute or by contract, or (iii) 12 months if such leave constitutes sick leave arising by reason of an injury to, or sickness of, the Participant, which, in either case, involves a medically determinable physical or mental impairment that (y) is expected to result in death or to last for a continuous period of not less than 6 months, and (z) renders the Participant unable to perform the duties of his position of employment or any substantially similar position of employment; or

	(vi)		a permanent decrease in the Participant’s service to a level that is no more than twenty percent (20%) of its prior level.

In determining whether a Termination of Employment has occurred, this definition shall be interpreted in accordance with regulations under Code Section 409A, with respect to separation from service, including, without limitation, whether it is reasonably anticipated that no further services will be performed by the Participant after a certain date or that the level of bona fide services the Participant will perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period (or the full period of services if the Participant has been providing services less than 36 months).

The transfer of a Participant from the Company to an Affiliate or from an Affiliate to the Company or another Affiliate shall not constitute a Termination of Employment for purposes of this Plan. In addition, without limiting the generality of the foregoing, in

determining Affiliates for purposes of applying this definition of Termination of Employment, the usual “at least 80%” standard in Code Section 1563(a)(1), (2) and (3) shall read “at least 50%” (or, where the Compensation Committee has determined that there is a good business reason for such lower limit, “at least 20%”) for purposes of construing Code Sections 414(b) and 414(c).

	(hh)		“Unforeseeable Emergency” means a severe financial hardship to a Participant within the meaning of Code Section 409A resulting from: (i) an illness or accident of the Member or the Member’s spouse or dependent (as defined in Code Section 152 without regard to Code Sections 152(b)(1), (b)(2) and (d)(1)(B)); (ii) loss of the Participant’s property due to casualty; or (iii) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.

	(ii)		“Valuation Date” means each business day.

	(jj)		“Years of Service” shall have the same meaning as in the 401(k) Plan.

2.2 Number and Gender.

2.3 Headings.

The headings of Articles and Sections herein are included solely for convenience, and if there is any conflict between such headings and the rest of the Plan, the text shall control.

ARTICLE III
PARTICIPATION AND ELIGIBILITY

3.1 Participation.

Participants in the Plan are those Employees who are (a) subject to the income tax laws of the United States, (b) members of a select group of highly compensated or management Employees, and (c) selected by the Committee or its delegates, in its sole discretion, as Participants. The Committee shall notify each Participant of his selection as a Participant. An Employee who satisfies the eligibility requirements set forth in subsections (a) and (b) shall remain eligible to continue participation in the Plan for each Plan Year following his selection by the Committee as a Participant unless the Committee shall determine otherwise.

3.2 Commencement of Participation.

Except as provided in the following sentence, an Employee shall become a Participant effective as of the first day of the Plan Year following the date on which his Participation and Deferral Election Form becomes effective.

3.3 Cessation of Active Participation.

Notwithstanding any provision herein to the contrary, an individual who has become a Participant in the Plan shall cease to be a Participant hereunder, effective as of such date as may be designated by the Committee, provided that for purposes of ceasing Base Salary Deferrals and Bonus Deferrals, such date may only occur as of the end of a Plan Year, except to the extent otherwise permitted under Code Section 409A. Any such Committee action shall be communicated to such Participant prior to the effective date of such action.

3.4 Protective Measures.

If the Administrator determines, in its sole discretion, that a Participant is not, or may not be, a member of a “select group of management or highly compensated employees” within the meaning of Section 201(2), 301(a)(3), 401(a)(1) or 4021(b)(6) of ERISA, then the Administrator may, in its sole discretion, terminate the Participant’s participation in the Plan as of the last day of the then current Plan Year. Such Participant’s deferral election(s) shall also be cancelled as of the last day of such Plan Year. Such termination of participation shall not impact the time and form of payment of the amounts credited to such Participant’s Accounts, which will be distributed by the Company in accordance with the other provisions hereof.

ARTICLE IV
CONTRIBUTIONS AND VESTING

4.1 Deferrals by Participants.

No later than the last day of the Plan Year immediately preceding the Plan Year to which the Participation and Deferral Election Form relates, a Participant who elects to make Base Salary Deferrals must file with the Committee a Participation and Deferral Election Form pursuant to which such Participant elects to make Base Salary Deferrals.

A Participant must file a Participation and Deferral Election Form to make Bonus Deferrals at a time prescribed by the Committee which time shall be not later than six (6) months before the end of the 12 month period over which the services upon which the Bonus Compensation is based are performed, provided that in no event may an election to defer be made after such Bonus Compensation to which the Bonus Deferral relates has become readily ascertainable.

A deferral election will be irrevocable as of the last permissible date for making such election, as described in this Section 4.1.

A Participant shall be entitled to defer a whole percent of his Base Salary or Bonus Compensation, subject to a maximum deferral of fifty percent (50%) of Base Salary and one hundred percent (100%) of Bonus Compensation.

At the time a Participant completes a Participation and Deferral Election Form, he shall elect to have his Base Salary Deferrals and Bonus Deferrals credited to a Retirement Account or an In-Service Distribution Account.

An election to have amounts credited to an In-Service Distribution Account shall specify the Deferral Period applicable to such amounts by specifying the calendar year in which payment of amounts in such In-Service Distribution Account shall be made or shall commence to be made in accordance with Section 6.1, which shall be no sooner than two full years following the Plan Year to which such deferrals relate and whether the distribution is to be paid in a lump sum or in annual installments amortized over a specified period of years not to exceed five (5) years in accordance with Section 6.3(b). A Participant shall be permitted a maximum of two In-Service Distribution Accounts in existence at any time. Once a Participant has two In-Service Distribution Accounts established, he may make further In-Service Distribution elections only if the amount subject to such further elections can be properly allocated to an existing In-Service Distribution Account. In the event an election to have amounts credited to an In-Service Distribution Account fails to specify a valid Deferral Period, then any amounts subject to such election shall be credited to an In-Service Distribution Account with a Deferral Period of two full years following the Plan Year to which the deferrals relate. If the Participant already has two existing In-Service Distribution Accounts, the amounts subject to the election shall be credited to the Account that has a remaining Deferral Period that is closest to but not less than two years.

Base Salary Deferrals will be credited to the Account of each Participant as soon as practicable following each pay date, if and to the extent that the Participant earned such Base Salary as an Employee for such pay date. Bonus Deferrals will be credited to the Account of each Participant not later than the last day of the month in which such Bonus Compensation otherwise would have been paid to the Participant in cash, provided that if the Participant has incurred a Termination of Employment at the time the Bonus Compensation would otherwise have been paid, the Bonus Deferral shall be immediately distributed from the Plan if the Participant has received full distribution of his Account; otherwise, it shall be credited to the Plan and paid in accordance with the timing and form of payment otherwise applicable to such Participant’s Retirement Account .

4.2 Effective Date of Participation and Deferral Election Form.

Except as provided below with respect to a new Participant, a Participant’s Participation and Deferral Election Form shall become effective on the first day of the Plan Year to which it relates. If an Employee fails to timely complete a Participation and Deferral Election Form in accordance with Section 4.1, the Employee shall be deemed to have elected not to make Base Salary Deferrals and/or Bonus Deferrals for such Plan Year.

4.3 Modification or Revocation of Election by Participant.

Subject to Section 6.10, a Participant may not prospectively change the amount of his Base Salary Deferrals or Bonus Deferrals during a Plan Year. Unless required or permitted by law, under no circumstances may a Participant’s Participation and Deferral Election Form be made, modified or revoked retroactively.

4.4 Matching Contributions.

Each Participant who elects to make Base Salary Deferrals and/or Bonus Deferrals to the Plan and who has completed at least six (6) months of service with the Company or any Affiliate will receive Matching Contributions in accordance with the applicable matching contribution percentage formula provided under the 401(k) Plan. Matching Contributions will be credited to the Participant’s Retirement Account at such time or times as the Company shall determine.

4.5 Make Whole IQC Contributions.

Each year, the Retirement Account of each eligible Participant shall be credited with the Make Whole IQC Contribution, if any, to which he is entitled under Section 2.1(x).

4.6 Discretionary Contributions.

For each Plan Year, the Retirement Account of each eligible Participant shall be credited with such Discretionary Contribution, if any, as is determined by the Company for such Plan Year at such time or times as the Company shall determine.

4.7 Suspension of Contributions.

Anything contained herein to the contrary notwithstanding, if a Participant receives a distribution from the Plan due to an Unforeseeable Emergency, any existing deferral election(s) made under Section 4.1 shall be cancelled. Any future deferral election made under Section 4.1 shall apply only to Base Salary or Bonus Compensation that would otherwise be payable at least six (6) months after receipt of such distribution. If required by the terms of the 401(k) Plan, if a Participant receives a hardship distribution under the 401(k) Plan, he shall have any existing deferral election(s) made under Section 4.1 cancelled. Any future deferral election made under Section 4.1 shall apply only to Base Salary or Bonus Compensation that would otherwise be payable at least six (6) months after receipt of such distribution.

4.8 Vesting.

A Participant shall be 100% vested at all times in that portion of his Account which is attributable to Base Salary Deferrals and Bonus Deferrals. Matching Contributions, Make Whole IQC Contributions, Discretionary Contributions and Prior Plan Unvested Amounts shall vest in accordance with the vesting schedule contained in the 401(k) Plan. Notwithstanding the foregoing, all Matching Contributions, Make Whole IQC Contributions, Profit Sharing Contributions and Discretionary Contributions shall be 100% vested immediately upon a Change in Control or a Participant’s Disability. Any provisions of the Plan relating to the distribution of a Participant’s Account shall mean only the vested portion of such Account. Since the Plan is unfunded, the portion of a Participant’s Account which is not vested and therefore not distributed with the vested portion of his Account shall remain property of the Company and shall not be allocated to the Accounts of other Participants or otherwise inure to their benefit.

4.9 Suspension and Forfeiture Following Accelerated Distribution of Grandfathered Deferrals.

If a Participant elects to receive an accelerated distribution from the Participant’s account under the Invacare Corporation 401(k) Plus Benefit Equalization Plan, he shall forfeit the unvested portion of his Account under the Plan and shall be suspended from making future deferral elections under Section 4.1 for the two (2) consecutive Plan Years which begin on or after the date of such distribution, although any existing deferral election(s) under Section 4.1 for the Plan Year in which such accelerated distribution is taken shall remain in force.

ARTICLE V
ACCOUNTS

5.1 Establishment of Bookkeeping Accounts.

A separate bookkeeping Account or Accounts shall be maintained for each Participant. Such Account(s) shall be credited with the Base Salary Deferrals and Bonus Deferrals made by the Participant pursuant to Section 4.1, Matching Contributions made by the Company pursuant to Section 4.4, Make Whole IQC Contributions made pursuant to Section 4.5, Discretionary Contributions made pursuant to Section 4.6 and any Prior Plan Unvested Amount credited (or charged, as the case may be) with the hypothetical investment results determined pursuant to Section 5.3, and charged with distributions made to or with respect to a Participant.

5.2 Subaccounts.

Within each Participant’s bookkeeping Account, separate subaccounts shall be maintained to the extent necessary or desirable for the administration of the Plan. At a minimum, a Retirement Account shall be maintained for distributions to be made upon a Participant’s Retirement or other Termination of Employment and an In-Service Distribution Account shall be maintained for distributions to be made upon expiration of each Deferral Period selected by the Participant under Section 4.1.

5.3 Earnings Elections.

Amounts credited to a Participant’s Account shall be credited or charged with earnings and losses based on hypothetical investments elected by the Participant. A Participant may elect different investment allocations for new contributions and existing Account balances. Only whole percentages may be elected, the minimum percentage for any allocation is 1%, and the total elections must allocate 100% of all new contributions and 100% of all existing Account balances. Investment elections may be changed daily, in accordance with procedures established by the Committee. The hypothetical investment alternatives and the procedures relating to the election of such investments, other than those set forth in this Section 5.3, shall be determined by the Committee from time to time. A Participant’s Account shall be adjusted as of each Valuation Date to reflect investment gains and losses.

Notwithstanding the foregoing provisions of this Section 5.3, if investment in Invacare stock is permitted hereunder, the Company in its sole discretion, shall have the authority to place such restrictions upon the investment directions of any person who is subject to Section 16(b) of the Securities Exchange Act of 1934 as amended (“Insider”) as shall be appropriate to comply with such section. Such restrictions shall include, but shall not be limited to the following: Insiders shall be permitted to submit investment directions relating to Invacare stock only on a “semi-annual date” which is no less than six (6) months after the date of the most recent investment direction received from such Insider relating to Invacare Stock. For purposes of this Section 5.3, the term “semi-annual date” shall mean a date which is within the period that begins the third business day following the date on which the Company’s first fiscal quarter and

third fiscal quarter summary statements of sales and earnings shall be released and which ends on the twelfth business day following such release date.

5.4 Hypothetical Accounts and Creditor Status of Participants.

The Accounts established under this Article V shall be hypothetical in nature and shall be maintained for bookkeeping purposes only. Neither the Plan nor any of the Accounts (or subaccounts) shall hold any actual funds or assets. The payments to a Participant, his Beneficiary or any other distributee hereunder shall be made from assets of the Company which shall continue, at all times, to be a part of the general unrestricted assets of the Company. The right of any person to receive one or more payments under the Plan shall be an unsecured claim against the general assets of the Company. Any liability of the Company to any Participant, former Participant, or Beneficiary with respect to a right to payment shall be based solely upon contractual obligations created by the Plan. Neither the Company, the Board, nor any other person shall be deemed to be a trustee of any amounts to be paid under the Plan. Except as provided in Section 5.5, nothing contained in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship, between the Company and a Participant, former Participant, Beneficiary, or any other person.

5.5 Investments.

The Company may, in its sole discretion, acquire insurance policies, annuities or other financial vehicles for the purpose of providing future assets to the Company to meet its anticipated liabilities under the Plan. Such policies, annuities, or other acquired assets, shall at all times be and remain unrestricted general property and assets of the Company or property of a trust established pursuant to this Plan. Participants and Beneficiaries shall have no rights, other than as general creditors, with respect to any such policies, annuities or other acquired assets. Furthermore, the Company may establish a trust to hold such policies, annuities or other acquired assets, to be used to make, or reimburse the Company for, payments to the Participants or Beneficiaries of all or part of the benefits under this Plan, provided, however, that the trust assets shall at all times remain subject to the claims of general creditors of the Company in the event of its insolvency. In the event that a trust is established under this section, the Company shall remain liable for paying the benefits under this Plan. However, any payment of benefits to a Participant or Beneficiary made by the trust shall satisfy the Company’s obligation to make such payment to such person.

ARTICLE VI
PAYMENT OF ACCOUNT

6.1 Timing of Distribution of Accounts.

Distribution of a Participant’s entire Account (including any undistributed In-Service Distribution Accounts) shall be made or shall commence to be made as soon as practicable, but no later than 90 days, following the Participant’s Retirement or other Termination of Employment or death. Prior to a Participant’s Termination of Employment, distribution of a Participant’s In-Service Distribution Account(s) shall be made or shall commence to be made as soon as practicable after, but no later than 90 days following the expiration of the Deferral Period selected by the Participant for such Account(s). Notwithstanding the foregoing, if a Participant is a Key Employee, in the event of distribution upon Termination of Employment (for reasons other than death), actual payment of the Participant’s Accounts shall not occur prior to the first day of the seventh month following the Termination of Employment.

6.2 Adjustment for Investment Gains and Losses Upon a Distribution.

For purposes of any distributions hereunder, the value of a Participant’s Account shall be determined as of the Valuation Date immediately preceding the time such distribution is to be made.

6.3 Form of Payment.

	(a)		In general, all distributions hereunder shall be made in the form of a single lump sum payment. Notwithstanding the foregoing, at the time a Participant makes his first deferral election hereunder, a Participant may elect that if his Account is payable by reason of Retirement, payment shall be made in a lump sum or in annual installments amortized over a period of years not to exceed fifteen (15) years. Gains and losses on the unpaid balance shall continue to be credited or charged to the Account in accordance with the provisions of Section 5.3. Each annual installment shall be equal to the value of the Account as of the Valuation Date immediately preceding the date of payment divided by the number of installments remaining.

	(b)		Except as provided below, a Participant’s In-Service Distribution Account(s) shall be paid in one of the following forms as elected by the Participant:

(i)

A lump sum amount which is equal to the applicable Account balance; or

(ii)

A nnual installments amortized over a period of years not to exceed five (5) years. Gains and losses on the unpaid balance shall continue to be credited or charged to the Account in accordance with the provisions of Section 5.3. Each annual installment shall be equal to the value of the Account as of the Valuation Date immediately preceding the date of payment divided by the number of installments remaining.

Notwithstanding the form elected, if at the time of distribution by reason of Termination of Employment, a Participant’s total Account value under the Plan and all similar arrangements that would constitute a single nonqualified deferred compensation plan as defined under Treasury Regulation 1.409A-1(c)(2) is not more than the amount specified in Code Section 402(g)(1)(B), as adjusted from time to time, then the benefit shall be paid in a single lump sum as soon as practicable but no later than 90 days following the distribution event; provided, however, that if a Participant is a Key Employee, payment of the Participant’s Accounts for reasons other than death shall not occur prior to the first day of the seventh month following the Termination of Employment.

6.4 Change in Date or Form of Distribution.

In general, the form of payment elected by a Participant with respect to his Retirement Account shall be determined by the Participant’s election made at the time he makes his initial deferral election hereunder. Furthermore, the time and form of payment of any In-Service Distribution Account shall be determined by the Participant’s election made at the time he first elects such In-Service Distribution Account. Notwithstanding the foregoing, a Participant may elect one time to change the form of payment of his Retirement Account or the time and form of payment of his In-Service Distribution Account. Any such revised election shall be made by submitting such election in the form determined by the Committee and shall be subject to the following rules:

	(a)		the election may not take effect until at least 12 months after the date on which such election is made;

	(b)		the payment with respect to which such election is made must be deferred (other than a distribution upon death or Unforeseeable Emergency) for a period of not less than five (5) years from the date such payment would otherwise have been paid; and

	(c)		any subsequent election affecting a distribution at a specified time (or pursuant to a fixed schedule) may not be made less than 12 months before the date the payment is scheduled to be paid.

Any such revised election will become irrevocable as of the earlier of the last permissible date for making such election under (a) or (c) above.

6.5 Transition Elections.

Notwithstanding Sections 4.3, 6.3 and 6.4 above, the distributions and distribution elections (and subsequent changes thereto) permitted by the Company prior to 2009 pursuant to the transition relief under Code Section 409A, shall be given full force and effect. In addition, Participants shall be permitted to make such further elections to change the time and form of payment as are permitted by the Company under Section 6.4 above.

6.6 Designation of Beneficiaries.

Each Participant shall have the right, at any time, to designate one (1) or more persons or an entity as Beneficiary (both primary as well as secondary) to whom benefits under this Plan shall be paid in the event of a Participant’s death prior to complete distribution of the Participant’s Account. Each Beneficiary designation shall be in such form as prescribed by the Committee and will be effective only when filed with the Committee during the Participant’s lifetime. Designation by a married Participant of a Beneficiary other than the Participant’s spouse shall not be effective unless the spouse executes a written consent that acknowledges the effect of the designation and is witnessed by a notary public, or the consent cannot be obtained because the spouse cannot be located.

6.7 Change of Beneficiary Designation.

6.8 No Beneficiary Designation.

If any Participant fails to designate a Beneficiary in the manner provided above, or if the Beneficiary designated by a deceased Participant dies before the Participant or before complete distribution of the Participant’s benefits, the Participant’s Beneficiary shall be the person in the first of the following classes in which there is a survivor:

	(a)		The Participant’s surviving spouse;

	(b)		The Participant’s children in equal shares, except that if any of the children predeceases the Participant but leaves issue surviving, then such issue shall take by right of representation the share the parent would have taken if living;

	(c)		The Participant’s parents;

	(d)		The Participant’s estate.

6.9 Withdrawals for Unforeseeable Emergency.

A Participant may apply in writing to the Committee for, and the Committee may permit, a withdrawal of all or any part of a Participant’s Account, together with all earnings, gains and losses thereon, if the Committee, in its sole discretion, determines that the Participant has incurred an Unforeseeable Emergency. The amount that may be withdrawn shall be limited to the amount reasonably necessary to relieve the Unforeseeable Emergency upon which the request is based, plus the federal and state taxes due on the withdrawal, as determined by the Committee. The Committee may require a Participant who requests a withdrawal on account of an Unforeseeable Emergency to submit such evidence as the Committee, in its sole discretion, deems necessary or appropriate to substantiate the circumstances upon which the request is based and the unavailability of other resources with which the Participant may relieve the Unforeseeable Emergency.

6.10 Withholding.

All distributions shall be subject to legally required income and employment tax withholding. All deferrals shall be determined net of any required tax or other withholdings (including, without limitation, withholdings for FICA tax).

ARTICLE VII
ADMINISTRATION

7.1 Committee.

The Plan shall be administered by a Committee, which shall include the Senior Vice President of Human Resources, the Chief Financial Officer and the Senior Vice President and General Counsel, or the respective successors to those positions. The Committee shall be responsible for the general operation and administration of the Plan and for carrying out the provisions thereof. The Committee may delegate to others certain aspects of the management and operational responsibilities of the Plan including the employment of advisors and the delegation of ministerial duties to qualified individuals, provided that such delegation is in writing. No member of the Committee who is a Participant shall participate in any matter relating to his status as a Participant or his rights or entitlement to benefits as a Participant.

7.2 General Powers of Administration.

	(a)		To enact rules, regulations, and procedures and to prescribe the use of such forms as it deems advisable;

	(b)		To appoint or employ agents, attorneys, actuaries, accountants, assistants or other persons (who may also be Participants in this Plan or be employed by or represent the Company) at the expense of the Company, as it deems necessary to keep its records or to assist it in taking any other action authorized or required under the Plan;

	(c)		To interpret the Plan, and to resolve ambiguities, inconsistencies and omissions, to determine any question of fact, to determine the right to benefits of, and the amount of benefits, if any, payable to, any person in accordance with the provisions of the Plan and resolve all questions arising under the Plan;

	(d)		To administer the Plan in accordance with its terms and any rules and regulations it establishes; and

	(e)		To maintain records concerning the Plan as it deems sufficient to prepare reports, returns and other information required by the Plan or by law; and

(f)

To direct the Company to pay benefits under the Plan, and to give other directions and instructions as may be necessary for the proper administration of the Plan.

Any decision, interpretation or other action made or taken by the Administrator arising out of or in connection with the Plan, will be within the absolute discretion of the Administrator, and will be final, binding and conclusive on the Company, and all Participants and Beneficiaries and their respective heirs, executors, administrators, successors and assigns. The Administrator’s determinations under the Plan need not be uniform, and may be made selectively among Participants, whether or not they are similarly situated.

7.3 Indemnification of Committee.

ARTICLE VIII
DETERMINATION OF BENEFITS, CLAIMS PROCEDURE AND ADMINISTRATION

8.1 Claims.

8.2 Claim Decision.

Upon receipt of a claim, the Committee shall advise the Claimant that a reply will be forthcoming within a reasonable period of time, but ordinarily not later than ninety days, and shall, in fact, deliver such reply within such period. However, the Committee may extend the reply period for an additional ninety days for reasonable cause. If the reply period will be extended, the Committee shall advise the Claimant in writing during the initial 90-day period indicating the special circumstances requiring an extension and the date by which the Committee expects to render the benefit determination.

If the claim is denied in whole or in part, the Committee will render a written opinion, using language calculated to be understood by the Claimant, setting forth:

	(a)		the specific reason or reasons for the denial;

	(b)		the specific references to pertinent Plan provisions on which the denial is based;

	(c)		a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation as to why such material or such information is necessary;

	(d)		appropriate information as to the steps to be taken if the Claimant wishes to submit the claim for review, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review; and

	(e)		the time limits for requesting a review of the denial under Section 8.3 and for the actual review of the denial under Section 8.4.

If no notice is provided, the claim will be deemed denied. The interpretations, determinations and decisions of the Administrator will be final and binding upon all persons with respect to any right, benefit and privilege hereunder, subject to the review procedures set forth in this Article.

8.3 Request for Review of a Denied Claim.

Within sixty days after the receipt by the Claimant of the written opinion described above, the Claimant may request in writing that the Senior Vice President of Human Resources of the Company (“Executive Officer”) review the Committee’s prior determination. Such request must be addressed to the Executive Officer at the Company at its then principal place of business. The Claimant or his or her duly authorized representative may submit written comments, documents, records or other information relating to the denied claim, which information shall be considered in the review under this Section without regard to whether such information was submitted or considered in the initial benefit determination.

8.4 Review of Decision.

Within a reasonable period of time, ordinarily not later than sixty days, after the Executive Officer’s receipt of a request for review, it will review the Committee’s prior determination. If special circumstances require that the sixty-day time period be extended, the Executive Officer will so notify the Claimant within the initial 60-day period indicating the special circumstances requiring an extension and the date by which the Executive Officer expects to render its decision on review, which shall be as soon as possible but not later than 120 days after receipt of the request for review. In the event that the Executive Officer extends the determination period on review due to a Claimant’s failure to submit information necessary to decide a claim, the period for making the benefit determination on review shall not take into account the period beginning on the date on which notification of extension is sent to the Claimant and ending on the date on which the Claimant responds to the request for additional information.

Benefits under the Plan will be paid only if the Executive Officer decides in its discretion that the Claimant is entitled to such benefits. The decision of the Executive Officer shall be final and non-reviewable, unless found to be arbitrary and capricious by a court of competent review. Such decision will be binding upon the Company and the Claimant. Without limiting the foregoing, if the law provides that the Claimant may bring a legal action alleging a claim for benefits under this Plan, then, no Claimant may file any lawsuit in any court of law with respect to a claim for benefits hereunder unless such Claimant has timely and properly taken all steps to submit his claim to the Committee and to appeal any benefit denial to the

Executive Officer, and has otherwise followed the application and review procedures of this Plan.

If the Executive Officer makes an adverse benefit determination on review, the Executive Officer will render a written opinion, using language calculated to be understood by the Claimant, setting forth:

	(a)		the specific reason or reasons for the denial;

	(b)		the specific references to pertinent Plan provisions on which the denial is based;

	(c)		a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information which (i) was relied upon by the Executive Officer in making its decision, (ii) was submitted, considered or generated in the course of the Executive Officer making its decision, without regard to whether such instrument was actually relied upon by the Executive Officer in making its decision or (iii) demonstrates compliance by the Executive Officer with its administrative processes and safeguards designed to ensure and to verify that benefit claims determinations are made in accordance with governing Plan documents, and that, where appropriate, the Plan provisions have been applied consistently with respect to similarly situated claimants; and

	(d)		a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following the adverse benefit determination on such review.

8.5 Discretionary Authority.

The Committee and Executive Officer shall both have discretionary authority to determine a Claimant’s entitlement to benefits upon his claim or his request for review of a denied claim, respectively.

ARTICLE IX
AMENDMENT AND TERMINATION

9.1 Power to Amend or Terminate.

The Company reserves the right, by action of its Board in its sole discretion, to retroactively or prospectively amend, modify or terminate this Plan at any time.

9.2 Distribution Upon Plan Termination.

In the event the Company terminates the Plan in the manner permitted under Section 9.1, no liquidation and payment of benefits shall occur as a result of the termination; provided, however, that subject to the provisions of Section 9.1, the Company may, in its discretion, provide by amendment to the Plan for the liquidation and termination of the Plan where:

	(a)		the termination and liquidation does not occur proximate to a downturn in the financial health of the Company and Affiliates;

	(b)		the Plan and all arrangements required to be aggregated with the Plan under Code Section 409A are terminated and liquidated;

	(c)		no payments, other than those that would be payable under the terms of the Plan and the aggregated arrangements if the termination and liquidation had not occurred, are made within twelve (12) months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan;

	(d)		all payments are made within twenty-four (24) months of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan; and

	(e)		the Company and its Affiliates do not adopt a new arrangement that would be aggregated with any terminated arrangement under Code Section 409A, at any time within three (3) years following the date of the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan.

(a)

the calendar year in which the termination and liquidation occurs;

	(b)		the first calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or

	(c)		the first calendar year in which the payment is administratively practicable.

Notwithstanding the above, the Company may, in its discretion and pursuant to irrevocable action, provide by amendment to liquidate and terminate the Plan where the termination and liquidation occurs within the 30 days preceding or the 12 months following a “change in control event” (as defined under Code Section 409A), provided that the Plan and all arrangements required to be aggregated with the Plan under Code Section 409A are terminated and liquidated with respect to each Participant who experiences the “change in control event,” and provided that under the terms of the termination and liquidation all such Participants are required to receive all amounts of compensation deferred under the Plan and all aggregated arrangements within 12 months of the irrevocable amendment.

ARTICLE X
MISCELLANEOUS

10.1 Plan Not a Contract of Employment.

10.2 Non-Assignability of Benefits.

10.3 Severability.

10.4 Governing Laws.

All provisions of the Plan shall be construed in accordance with the internal laws (but not the choice of laws) of Ohio, except to the extent preempted by federal law.

10.5 Binding Effect.

This Plan shall be binding on each Participant and his heirs and legal representatives and on the Company and its successors and assigns.

10.6 Entire Agreement.

This document and any amendments contain all the terms and provisions of the Plan and shall constitute the entire Plan, any other alleged terms or provisions being of no effect. The Plan, together with any Participation and Deferral Election Forms, constitute the entire agreement between the parties with respect to the subject matter hereof.

10.7 No Guaranty of Tax Consequences.

It is the intention and purpose of the Company that this Plan shall be, at all relevant times, in compliance with (or exempt from) Code Section 409A and all other applicable laws, and this Plan shall be so interpreted and administered. In addition to the general amendment rights of the Company with respect to the Plan, the Company specifically retains the unilateral right (but not the obligation) to make, prospectively or retroactively, any amendment to this Plan or any related document as it deems necessary or desirable to more fully address issues in connection with compliance with (or exemption from) Code Section 409A and such other laws. In no event, however, shall this section or any other provisions of this Plan be construed to require the Company to provide any gross-up for the tax consequences of any provisions of, or payments under, this Plan and the Company shall have no responsibility for tax or legal consequences to any Participant (or Beneficiary) resulting from the terms or operation of this Plan.

IN WITNESS WHEREOF, the Company has caused this Plan to be signed as of the 31st day of December, 2008.


		INVACARE CORPORATION

		By		/s/ Joseph S. Usaj


		Its		SR VP Human Resources

Exhibit 10.5

SEVERANCE PROTECTION AGREEMENT

THIS AMENDED AND RESTATED SEVERANCE PROTECTION AGREEMENT is made and effective as of December 31 , 2008, by and between Invacare Corporation, an Ohio corporation with its principal place of business at One Invacare Way, Elyria, Ohio 44036 (“Invacare” or the “Company”), and Gerald B. Blouch (the “Executive”).

WITNESSETH :

WHEREAS, Executive is considered a key employee of the Company; and

WHEREAS, the Company desires to retain and motivate Executive consistent with the terms of this Agreement; and

WHEREAS, the Company and Executive, in order to insure Executive’s continued attention and dedication to his duties, previously entered into a certain severance protection agreement, effective as of October 1, 2002; and

WHEREAS, the Company and Executive desire to amend and restate such previous agreement because of recent legislation and other economic factors and in order to further address Internal Revenue Code Section 409A;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the Company and Executive agree as follows:

1. Acknowledgement of Position . The Company currently employs Executive as President and Chief Operating Officer of the Company, having those duties and responsibilities, and the authority, customarily possessed by the President and Chief Operating Officer of a major corporation and such additional duties as have been and may be assigned to him from time to time by the Chief Executive Officer and/or the Board of Directors of the Company (the “Board”) which are consistent with the positions of President and Chief Operating Officer of a major corporation. Service by Executive on the boards of other companies shall not be deemed to be a violation of this Agreement, provided such service does not significantly interfere with the confidentiality provisions or performance of his duties hereunder.

2. Termination of Employment .

A. Termination Due to Death or Disability . In the event that Executive’s employment with the Company is terminated due to his death or disability as defined in Section 3 hereof, respectively, his estate or his beneficiaries, as the case may be, shall be entitled to any

payments or benefits (including salary, etc.) accrued but unpaid at the time of Executive’s termination due to his death or disability, all as payable under Company plans in effect at the time of termination. If Executive dies or becomes disabled during the term of this Agreement, the duties of the Company and Executive, one to the other, under this Agreement shall terminate as of the date of Executive’s death, except as provided above.

B. Termination by the Company for Cause or Resignation by Executive other than for Good Reason . Upon Executive’s resignation other than for “Good Reason” as defined in Section 3, or upon the termination of Executive’s employment by the Company for “Cause” as defined in Section 3, Executive shall be entitled to any payments or benefits accrued but unpaid at the time of Executive’s termination by the Company for Cause or resignation by Executive other than for Good Reason, all as payable under Company plans in effect at the time of termination.

C. Termination by the Company other than for Cause or Resignation of Executive for Good Reason . Upon Executive’s termination by the Company other than for “Cause” as defined in Section 3 of this Agreement, or by Executive for “Good Reason” as described in Section 3 of this Agreement, Executive shall be entitled to the following amounts and benefits:

	(i)		Compensation payable to the extent of three times the amount of Executive’s then applicable annual base salary to be paid in a single sum no later than the earlier of six months and a day after the termination of employment or the 15th day of the 3rd month of the calendar year following the calendar year in which such termination of employment occurs (such earlier date being referred to herein as the “Short-term Date”);

	(ii)		75% of Executive’s target bonus for the year in which employment terminates to be paid no later than the Short-term Date;

	(iii)		Any then-outstanding stock option grant or award shall immediately vest in full as of the date of termination of employment (notwithstanding any provision therein contained); and

(iv)

The exercise period of any unexercised stock option shall be extended until the earlier of two (2) years after the date of termination of employment or expiration of the option (notwithstanding any provision therein contained). In addition, Executive shall be permitted to exercise any such option by means of a cashless exercise program, so long as (a) such program is allowed under all applicable laws and regulations, and (b) the Company is not required to recognize additional compensation expense as a result thereof.

In the event Executive violates any of the Restrictive Covenants, as defined in Section 11 of this Agreement, Executive shall no longer be entitled to receive any further cash severance amounts pursuant to subclauses (i) and (ii) above (and shall be obligated to promptly repay to the Company any such amounts previously paid to him, with interest at a rate of 6% compounded annually for any period from the initial violation of the Restrictive Covenants until the date of repayment), and thereafter subclauses (iii) and (iv) shall terminate and instead, the treatment of Executive’s options will be governed by the terms of the option plans and agreements thereunder.

3. Definitions .

A. Disability .

The term “disability” as used in this Agreement shall mean Executive’s inability, due to a mental or physical condition, to continue to provide services to the Company substantially consistent with past practice for a period of at least ninety (90) consecutive days, as evidenced by a written certification as to such condition from a physician designated by Executive and reasonably acceptable to the Board.

B. Good Reason .

Executive shall have “Good Reason” to terminate his employment under this Agreement if one or more of the events listed in (a) through (f) of this Section occurs and, based upon that event, Executive gives notice of his intention to terminate his employment effective on a date that is within 90 days of the initial occurrence of that event and Invacare does not cure the condition(s) constituting the event within 30 days after such notice:

	(i)		Executive is subjected to a material Demotion or Removal involving the Executive’s authority, duties, or responsibilities or in those of the individual to whom the Executive is required to report;

	(ii)		Executive’s Annual Base Salary, which shall mean his salary for the most recent fiscal year of the Company, is materially reduced (which for this purpose shall be deemed to occur if the reduction is equivalent to a five percent (5%) or greater reduction in the Executive’s Annual Base Salary);

	(iii)		Executive’s opportunity for incentive compensation as an officer or employee of the Company is materially reduced from the level of his opportunity for such incentive compensation for the prior year, without his prior written consent (which for this purposes shall be deemed to occur if the reduction is equivalent to a five percent (5%) or greater reduction in Executive’s Annual Base Salary);

	(iv)		Executive is excluded from full participation in any benefit plan or arrangement maintained for senior executives of the Company generally, and such exclusion materially reduces the benefits provided to the Executive;

	(v)		Executive’s responsibilities, duties, or authority as an officer or employee of the Company are at any time materially reduced from those then currently held by him; or

	(vi)		Executive’s principal place of employment is relocated more than 35 miles from One Invacare Way, Elyria, Ohio without his prior written consent.

C. Cause.

The employment of Executive by the Company shall have been terminated for “Cause” if any of the following has occurred:

	(i)		Executive shall have been convicted of a felony;

	(ii)		Executive commits an act or series of acts of dishonesty in the course of Executive’s employment which are materially inimical to

			the best interests of the Company and which constitutes the commission of a felony, all as determined by the vote of three-fourths of all of the members of the Board (exclusive of the Executive, if the Executive is a Director of the Company), which determination is confirmed by a panel of three arbitrators appointed and acting in accordance with the rules of the American Arbitration Association for the purpose of reviewing that determination;

	(iii)		any federal or state regulatory agency with jurisdiction over the Company has issued a final order, with no further right of appeal, that has the effect of suspending, removing, or barring Executive from continuing his service as an officer or Director of the Company;

	(iv)		after being notified in writing by the Board to cease any particular Competitive Activity, Executive shall intentionally continue to engage in such Competitive Activity while Executive remains in the employ of the Company; or

	(v)		Executive shall fail to devote his full business time to the business of the Company (excluding for these purposes any services performed for any charitable organizations, or organizations where he is participating as the Company’s representative), which failure continues after 30 days following the Company’s notice to Executive specifying such failure, during which time he will have the right to cure.

D. Demotion or Removal .

Executive shall be deemed to have been subjected to “Demotion or Removal” if (other than by voluntary resignation or with Executive’s written consent) Executive ceases to hold the highest position as an employee/officer of Invacare held by him at any time during the effectiveness of this Agreement with all of the duties, authority, and responsibilities of that office as in effect at any time during the effectiveness of this Agreement.

E. Competitive Activity .

Executive shall be deemed to have engaged in “Competitive Activity” if Executive engages in any business or business activity (other than as a Director, officer, or employee of the Company) that violates Section 7 hereof.

G. Termination .

Termination (and related terms, such as “termination of employment” and “terminate employment” mean a situation in which) the Executive incurs a “separation from service” with Invacare and all of its Affiliates within the meaning of Code Section 409A, which includes:

	(a)		a voluntary resignation or a resignation by Executive for Good Cause,

	(b)		involuntary discharge by Invacare for any reason;

	(c)		retirement;

	(d)		a leave of absence (including military leave, sick leave, or other bona fide leave of absence) but only at the point that such leave exceeds the greatest of (i) six months, (ii) the period for which the Executive’s right to reemployment is guaranteed either by statute or by contract, or (iii) 12 months if such leave constitutes sick leave arising by reason of an injury to, or sickness of, Executive, which, in either case, (A) is expected to result in death or to last for a continuous period of not less than 6 months, and (B) renders the Executive unable to perform the duties of his position of employment or any substantially similar position of employment; or

	(e)		a permanent decrease in Executive’s service to a level that is no more than twenty percent (20%) of its prior level.

For purposes of this subsection G, whether a separation from service has occurred is determined based on whether it is reasonably anticipated that no further services will be performed by the Executive after a certain date or that the level of bona fide services the Executive will perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent

contractor) over the immediately preceding 36-month period (or the full period of services if the Executive has been providing services less than 36 months).

4. Notice of Termination .

Any termination of Executive’s employment by the Company or by Executive shall be communicated by written Notice of Termination to the other party hereto, which shall set forth the effective date of such termination (not earlier than the date of mailing, or delivery by other means, of the notice).

5. Expenses .

In the event either party to this Agreement shall be forced to enforce the terms of this Agreement, the party successfully enforcing such terms shall be entitled to reimbursement of its reasonable legal and accounting fees from the other party hereto.

6. Term; Change of Control .

This Agreement’s term shall begin on the effective date written above and shall terminate three (3) years thereafter or upon a Change of Control of the Company as defined in the Change of Control Agreement between Executive and the Company dated as of April 1, 2000, and as most recently amended and restated as of December 31, 2008, as the same may be further amended (the “Change of Control Agreement”); provided, however, that if such Change of Control does not occur, then the term of this Agreement automatically shall extend for additional one (1) year terms unless terminated by either party upon ninety (90) days written notice. For purposes of this Agreement, “Change of Control” shall have the meaning ascribed to it in the above referenced Change of Control Agreement. The Company and Executive acknowledge that if a Change of Control occurs, Executive will thereafter be protected to the extent and on the terms provided in the Change of Control Agreement (the payments under which are, similar to this Agreement, intended to be exempt from Internal Revenue Code Section 409A).

7. Noncompetition .

Executive agrees that from the date hereof until the end of the two (2) year period commencing on the date of his termination of employment with the Company or the two (2) year period after the last payment due to Executive hereunder, whichever occurs later (the “Noncompetition Period”), he will not, either directly or indirectly, in any capacity whatsoever,

(a) compete with the Company by soliciting any customer of the Company by whatever method or (b) operate, control, advise, be employed and/or engaged by, perform any consulting services for, invest in (other than the purchase of no more than 5 percent of the publicly traded securities of a company whose securities are traded on a national stock exchange) or otherwise become associated with, any person, company or other entity who or which, at any time during the Noncompetition Period, competes with the Company. As used above, “compete” is defined as the marketing, distribution or sale of products substantially similar to or directly competitive with those sold by the Company in any geographical area in which the Company maintains offices, sales agents, has customers or otherwise conducts business, at the time of Executive’s termination of employment. Executive further expressly represents and understands that if Executive’s employment is terminated, this Agreement will prohibit Executive from future employment with all major companies that compete with the Company, as defined in this Agreement, and as such, will constrain some of Executive’s overall possibilities for future employment. By Executive’s signature to this Agreement, Executive expressly represents that his training, education and background are such that his ability to earn a living shall not be impaired by the restriction in this Agreement.

8. Nondisclosure .

Executive agrees at all times to hold as secret and confidential (unless disclosure is required pursuant to court order, subpoena, in a governmental proceeding, arbitration, or pursuant to other requirement of law) any and all proprietary knowledge, technical information, business information, developments, trade secrets and confidences of the Company or its business, including, without limitation, (a) information or business secrets relating to the products, customers, business, conduct or operations of the Company or any of its respective clients, customers, consultants or licensees; and (b) any of the Company’s customer lists, pricing and purchasing information or policies (collectively, “Confidential Information”), of which he has acquired knowledge during or after his employment with the Company, to the extent that such matters (i) have not previously been made public or are not thereafter made public by or through the Executive, or (ii) do not otherwise become available to Executive, in either case, via a source not bound by any confidentiality obligations to the Company. The phrase “made public” as used in this Agreement shall apply to matters within the domain of the general public or the Company’s industry. Executive agrees not to use, directly or indirectly, such knowledge

for his own benefit or for the benefit of others and not to disclose any of such Confidential Information without the prior written consent of the Company. At the termination of employment with the Company, Executive agrees to promptly return to the Company any and all written Confidential Information received from the Company which relates in any way to any of the foregoing items covered in this paragraph and to destroy any transcripts or copies Executive may have of such Confidential Information unless an alternative method of disposition is approved by the Company.

9. Nonsolicitation/Noninterference/Nondisparagement .

Executive agrees that during the period that is coterminous with the Noncompetition Period (the “Nonsolicitation Period”), he will not at any time, without the prior written consent of the Company, directly or indirectly solicit, induce, or attempt to solicit or induce any employee, former employee (as herein defined), agent, consultant, or other significant representative of the Company for the purpose of providing employment opportunities or to terminate such individual’s relationship with the Company. Executive further covenants and agrees that, during the Nonsolicitation Period, he will not, without the prior written consent of the Company, directly or indirectly, induce or attempt to induce any actual or prospective customers or suppliers of the Company to terminate, alter or change its relationship with the Company or otherwise interfere with any relationship between the Company and any of its actual or prospective suppliers or customers. A “former employee” shall mean any person who was employed by the Company at any time during the one (1) year period prior to Executive’s termination of employment with the Company. Executive further covenants that at all times after termination of his employment with the Company, Executive shall refrain from making any statements (whether oral, written or electronic) to any person or organization, including, but not limited to, members of the press and media, and other members of the public, which would disparage the Company or its officers, Directors or affiliates.

10. Intellectual Property Assignment .

Executive agrees that all ideas, improvements, computer programs, code, or flowcharts, inventions, and discoveries that are directly related to the business of the Company either as previously conducted or as conducted at any time during Executive’s employment, that Executive may have made or that Executive may make or conceive, alone or jointly with others,

prior to or during Executive’s employment with the Company shall be the sole property of the Company, and Executive agrees:

	(A)		to promptly disclose any such ideas, improvements, inventions, and discoveries to the Company; and

	(B)		to treat such ideas, improvements, inventions, and discoveries as the trade secrets of the Company; and

	(C)		not to disclose such ideas, improvements, inventions, and discoveries to anyone, both during and after Executive’s employment with the Company, without the Company’s prior written approval.

Executive hereby assigns all of Executive’s right, title and interest, in and to any such ideas, improvements, inventions, or discoveries, including any potential patent rights and any additional rights conferred by law upon Executive as the author, designer, or inventor thereof, to (a) vest full title in the idea, improvement, invention, or discovery in the Company, and (b) to enable the Company to seek, maintain or enforce patent or other protection thereon anywhere in the world.

Executive agrees that the Company is the author (owner) of any work of authorship or copyrightable work (“Work”) created by Executive, in whole or in part, during Executive’s employment by the Company and directly relating to the business of the Company as previously conducted or as conducted at any time during Executive’s employment. Executive acknowledges that each writing and other literary Work , each drawing and other pictorial and/or graphic Work and any audio-visual Work, created by Executive, in whole or in part, and directly relating to his position or responsibilities with the Company has been prepared by Executive for the Company as a Work for hire. Executive agrees that in the event that such Work is not considered Work for hire, Executive hereby assigns all copyright and any other rights conferred in law unto Executive in and to such Work to the Company. Executive agrees that at the request of the Company, Executive will execute any documents deemed necessary by the Company to (a) vest full title to the Work in the Company, and (b) enable the Company to register, maintain, or enforce copyrights in the Work anywhere in the world. Executive will treat any such Work as the trade secrets of the Company and will not disclose it to anyone both during and after Executive’s employment by the Company, without the Company’s prior written approval.

11. Internal Revenue Code Section 409A .

This Agreement is intended to meet the requirements for exemption from (or to the extent not exempt, in compliance with) Internal Revenue Code Section 409A (including without limitation, the exemptions for short-term deferrals and separation pay arrangements), and this Agreement shall be so construed and administered. Notwithstanding anything in this Agreement to the contrary, Invacare may unilaterally amend this Agreement, retroactively or prospectively, while maintaining the spirit of this Agreement and after consultation with Executive, to secure exemption from (or, to the extent not exempt, to ensure compliance with), the requirements of Section 409A and to avoid adverse tax consequences to Executive thereunder. Furthermore, the Executive agrees to execute such further instruments and take such further action as may be necessary to comply with Section 409A or to avoid adverse tax consequences to Executive thereunder. In no event, however, shall this section or any other provisions of this Agreement be construed to require the Company to provide any gross-up for the tax consequences under Internal Revenue Code Section 409A of any provisions of, or payments under, this Agreement and the Company shall have no responsibility for tax or legal consequences to any Executive (or Beneficiary) resulting from the terms or operation of this Agreement, except as otherwise set forth in Section 14, below.

12. Severability .

In the event that Sections 7, 8, 9 or 10 (the “Restrictive Covenants”) hereof shall be found by a court of competent jurisdiction to be invalid or unenforceable as written as a matter of law, the parties hereto agree that such court(s) may exercise its discretion in reforming such provision(s) to the end that Executive shall be subject to noncompetition, nondisclosure, nonsolicitation/noninterference, nondisparagement and intellectual property assignment covenants that are reasonable under the circumstances and enforceable by the Company.

13. Acknowledgment .

Executive specifically acknowledges that the Restrictive Covenants are reasonable, appropriate, and necessary as to duration, scope, and geographic area in view of the nature of the relationship between Executive and the Company and the investment by the Company of significant time and resources in the training, development, and employment of Executive. Executive warrants and represents that in the event that any of the Restrictive Covenants become operative, he will be able to engage in other activities for the purpose of earning a livelihood, and shall not be impaired by these restrictions.

Executive further acknowledges that the remedy at law for any breach of these covenants, including monetary damages to which the Company may be entitled, will be inadequate and that the Company, its successors and/or assigns, shall be entitled to injunctive relief against any breach without bond. Such injunctive relief shall not be exclusive, but shall be in addition to any other rights or remedies which the Company may have for any such breach.

Executive further acknowledges that he is an “at will” employee of the Company and nothing expressed or implied in this Agreement shall create any right or duty on the part of the Company or Executive to have Executive continue as an officer of the Company or to remain in the employment of the Company.

14. Limitation of Payment .

Notwithstanding anything in this Agreement to the contrary, if receipt of any of the benefits hereunder would subject Executive to tax under Section 4999 of the Internal Revenue Code of 1986, as amended (or similar successor statute) (hereafter “Section 4999”), the Company shall promptly pay to Executive a “gross up” amount that would allow the Executive to receive the net after-tax amount he would have received but for the application of said Section 4999 to any payments hereunder, including any payments made pursuant to this Section 14.

15. Successor to Invacare .

The Company shall not consolidate with or merge into any other corporation, or transfer all or substantially all of its assets to another corporation, unless such other corporation shall assume this Agreement in a signed writing and deliver a copy thereof to Executive. Upon such assumption, the successor corporation shall become obligated to perform the obligations of the Company under this Agreement and the term “Company” as used in this Agreement shall be deemed to refer to such successor corporation.

16. Notices .

Notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered in person or by confirmed facsimile transmission (Chairman of the Board of the Company in the case of notices to the Company and to Executive in the case of notices to the Executive) or mailed by United States registered mail, return receipt requested, postage prepaid, addressed as follows (or to such other address as may be specified in accordance herewith):

If to Company:

Invacare Corporation
899 Cleveland Street
P.O. Box 4028
Elyria, OH 44036-2125
Attention: Chairman of the Board

If to Executive:

Gerald B. Blouch
1823 Arlington Row
Westlake, Ohio 44145

17. Entire Agreement; Supercession.

Except as otherwise specifically provided herein, this Agreement, including its attachments, contains the entire agreement between the parties concerning the subject matter hereof and incorporates and supersedes any and all prior discussions or agreements, written or oral, the parties may have had with respect to such subject matter including, without limitation, that certain severance protection agreement entered into by Invacare and the Executive as of October 1, 2002; provided , however, that except as expressly provided otherwise herein, nothing in this Agreement shall affect any rights Executive or anyone claiming through Executive may have in respect of either (a) any employee benefit plan which provides benefits to or in respect of the Executive or (b) any other agreements the Executive may have with the Company or an Affiliate, including the Change of Control Agreement, except to the extent any such employee benefit plan or other agreement provides benefits which are duplicative of those provided under this Agreement.

18. Post-Mortem Payments; Designation of Beneficiary .

In the event that, following the termination of Executive’s employment with the Company, the Executive is entitled to receive any payments pursuant to this Agreement and Executive dies, such payments shall be made to the Executive’s beneficiary designated hereunder. At any time after the execution of this Agreement, the Executive may prepare, execute, and file with the Secretary of the Company a copy of the Designation of Beneficiary form attached to this Agreement as Exhibit A. Executive shall thereafter be free to amend, alter or change such form; provided , however, that any such amendment, alteration or change shall be made by filing a new Designation of Beneficiary form with the Secretary of the Company. In the

event Executive fails to designate a beneficiary, following the death of Executive all payments of the amounts specified by this Agreement which would have been paid to the Executive’s designated beneficiary pursuant to this Agreement shall instead be paid to Executive’s spouse, if any, if she survives Executive or, if there is no spouse or she does not survive Executive, to Executive’s estate.

19. Representations and Warranties of the Company .

The Company represents and warrants to Executive that (i) the Company is a corporation duly organized, validly existing, and in good standing under the laws of the State of Ohio; (ii) the Company has the power and authority to enter into and carry out this Agreement, and there exists no contractual or other restriction upon its so doing; (iii) the Company has taken such corporate action as is necessary or appropriate to enable it to enter into and perform its obligations under this Agreement; and (iv) this Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

20. Governing Law .

All questions concerning the construction, validity and interpretation of this Agreement and the exhibits hereto will be governed by and construed in accordance with the internal laws of the State of Ohio, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Ohio or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Ohio.

21. Assignment .

Neither the Company nor Executive shall assign this Agreement without the prior written consent of the other party hereto.

22. Entire Agreement; Amendments; Waivers .

As set forth in Section 17, this Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof. It may not be changed orally, but only by agreement, in writing, signed by each of the parties hereto. The terms or covenants of this Agreement may be waived only by a written instrument specifically referring to this Agreement, executed by the party waiving compliance. Any such waiver, amendment or modification on behalf of the Company, unless otherwise specified herein, may be authorized either by a simple majority of the Board (excluding Executive for all purposes) or a majority of

the Compensation Committee members. The failure of the Company at any time, or from time to time, to require performance of any of Executive’s obligations under this Agreement shall in no manner affect the Company’s right to enforce any provision of this Agreement at a subsequent time; and the waiver by the Company of any right arising out of any breach shall not be construed as a waiver of any right arising out of any subsequent breach.

23. Headings .

The headings in this Agreement are intended solely for convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.

24. Counterparts .

This Agreement may be executed in multiple counterparts each of which shall be deemed an original but all of which together shall constitute one and the same document.

[Signature Page to Follow]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.


	INVACARE CORPORATION “Invacare”
	By	/s/ Joseph Usaj
		Joseph Usaj, Senior Vice President


	GERALD B. BLOUCH “Executive”
	/s/ Gerald B. Blouch

Exhibit A
to Severance Protection Agreement

DESIGNATION OF BENEFICIARY


To:		Invacare Corporation Attention: Secretary

I, the undersigned Gerald B. Blouch, am a party to a certain Amended and Restated Severance Protection Agreement with Invacare Corporation, an Ohio corporation, dated as of , 2008 (the “Agreement”). Pursuant to the Agreement, I have the right to designate a person or persons to receive, in the event of my death, any amounts that might become payable to me under the Agreement. I hereby exercise this right and direct that, upon my death, any amounts payable to me under the Agreement shall be distributed in the proportions set forth below to the following person(s) if he, she or they survive me, namely:


Beneficiary	Relationship	Percent Share

If none of the above-designated person(s) survives me, any amounts payable under the Agreement shall be distributed to .

Any and all previous designations of beneficiary made by me are hereby revoked, and I hereby reserve the right to revoke this designation of beneficiary.


Date:

						Gerald B. Blouch

Exhibit 99.1


News Release		Contact:
		Lara Mahoney
		Invacare Corporation
		(440) 329-6393

INVACARE CORPORATION ANNOUNCES NEW SENIOR VICE PRESIDENT AND GENERAL COUNSEL

ELYRIA, Ohio – (December 31, 2008) – Invacare Corporation (NYSE: IVC) today announced that Anthony C. LaPlaca will become its Senior Vice President and General Counsel effective January 1, 2009, replacing Dale C. LaPorte, 66, who retired as of December 31, 2008. Mr. LaPlaca will report directly to A. Malachi Mixon, III, Chairman and Chief Executive Officer.

He will be responsible for all legal affairs, risk management, and intellectual property matters at the Company and also will serve as the corporate secretary.

“We will miss Dale LaPorte after so many years of assistance to our company, both as outside counsel and for the last three years as our Senior Vice President and General Counsel,” said Mr. Mixon. “Dale assisted me with the buyout of Invacare Corporation back in 1979 when it was a small private company and he has worked tirelessly for Invacare ever since. While we will miss his wise counsel and loyal dedication, we know that he deserves to enjoy his retirement.”

Mr. LaPlaca comes to Invacare from Bendix Commercial Vehicle Systems LLC, a member of the Knorr-Bremse group, where he served as Vice President and General Counsel for the past six and a half years. Prior to that he served as Vice President and General Counsel to Honeywell Transportation & Power Systems and General Counsel to Honeywell Commercial Vehicle Systems LLC, the predecessor to the Bendix business at Honeywell. Before that, Mr. LaPlaca was in private practice for thirteen years at a Cleveland-based national law firm, including the last four years as a partner. Mr. LaPlaca, 50, holds a bachelor of science degree from The Wharton School, University of Pennsylvania, and a juris doctor degree cum laude from Boston University School of Law.

Invacare Corporation (NYSE:IVC), headquartered in Elyria, Ohio, is the global leader in the manufacture and distribution of innovative home and long-term care medical products that promote recovery and active lifestyles. The company has 6,100 associates and markets its products in 80 countries around the world. For more information about the company and its products, visit Invacare’s website at www.invacare.com.