Exhibit 10(k)(iv)
EXECUTION VERSION
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FIRST AMENDMENT, dated as of November 13, 2006 (this "Amendment"),
to the Note Agreement and Guaranty, dated as of October 25, 2005 (as the same
may be further amended, supplemented, waived or otherwise modified from time to
time, the "Note Agreement"), among ALBANY INTERNATIONAL CORP., a Delaware
corporation (the "Company"), the Guarantors (as defined in the Note Agreement),
and The Prudential Insurance Company of America ("Prudential") and the several
Purchasers (as defined in the Note Agreement) (together with Prudential,
individually, a "Purchaser," " and collectively, "Purchasers").
W I T N E S S E T H:
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WHEREAS, the Company and Guarantors party thereto and the Purchasers
party thereto have executed and delivered the Note Agreement; and
WHEREAS, the Company has requested the amendment of certain
provisions of the Note Agreement, and the Purchasers have indicated willingness
to agree to such amendments subject to certain limitations and conditions, as
provided for herein;
NOW THEREFORE, in consideration of the premises, the mutual
covenants and the agreements hereinafter set forth and other good and valuable
consideration, the parties hereto hereby agree that on the Amendment Effective
Date, as defined herein, the Note Agreement will be amended as follows:
1. Definitions. Unless otherwise defined herein, terms defined in
the Note Agreement are used herein as therein defined.
2. Amendment to Section 6B of the Note Agreement (Negative Pledge).
Section 6B of the Note Agreement is hereby amended, as of the Amendment
Effective Date, as follows: clause (e) is hereby amended by deleting the text
therein in its entirety and inserting in lieu thereof the following text: "(e)
any Lien on any asset of any corporation existing at the time such corporation
is merged or consolidated with or into the Company or any Consolidated
Subsidiary and not created in contemplation of such event; provided that such
Lien shall not extend to other properties or assets of the Company or any
Subsidiary and shall secure only those obligations which it secures on the date
of such merger or consolidation and extensions, renewals and replacements
thereof that do not increase the outstanding principal amount thereof;".
3. Amendment to Section 6D of the Note Agreement (Transactions with
Affiliates). Section 6D of the Note Agreement is hereby amended, as of the
Amendment Effective Date, as follows: (a) clause (d) is hereby amended by
deleting the text therein in its entirety and inserting in lieu thereof the
following text:
"the Company or any Subsidiary (i) may make sales to or purchases from any
Affiliate and, in connection therewith, extend credit, may make payments
or provide compensation for services rendered by any Affiliate, and may
engage in any other transaction with any Affiliate, in each case in the
ordinary course of business and consistent with past practice and (ii) may
repurchase common stock of the Company from any Affiliate; provided that
any such transaction with an Affiliate pursuant to clause (i) or (ii) is
on terms and conditions at least as favorable to the Company or such
Subsidiary as the terms and conditions that would apply (1) in an arm's
length transaction with a Person not an Affiliate or (2) in the case of a
transaction relating to pension, deferred compensation, insurance or other
benefit plans with an Affiliate employee, in a similar transaction with a
non-Affiliate employee; and".
4. Amendment to Section 6E of the Note Agreement (Restricted
Payments). Section 6E of the Note Agreement is hereby amended, as of the
Amendment Effective Date, by deleting after the words "does not exceed" the
number "2.25" and inserting in lieu thereof the number "2.50".
5. Amendment to Section 6G of the Note Agreement (Investments,
Loans, Advances, Guarantees and Acquisitions). Section 6G of the Note Agreement
is hereby amended, as of the Amendment Effective Date, as follows: (a) clause
(c) is hereby amended by deleting after the words "Equity Interest in other
Persons" the words "with an aggregate fair market value for all such
acquisitions not to exceed $250,000,000"; (b) clause (d) is hereby amended by
deleting after the words "Leverage Ratio" the words "is less than 2.50 to 1.00"
and inserting in lieu thereof the words "does not exceed 3.00 to 1.00, and loans
or advances to Subsidiaries to provide funds required to effect such
acquisitions"; and (c) clause (e) is hereby amended by deleting the text therein
in its entirety and inserting in lieu thereof the following text:
(e) (i) any investment, loan or advance by the Company or a Guarantor in
or to the Company or another Guarantor, (ii) any investment, loan or
advance by a Subsidiary that is not a Guarantor in or to the Company or a
Guarantor; provided that each such loan or advance referred to in this
preceding clause (ii) shall be subordinated to the obligations hereunder
(it being understood that any such subordination shall not be construed to
create a Lien), (iii) any investment, loan or advance by any Subsidiary
that is not a Guarantor in or to any other Subsidiary that is not a
Guarantor and (iv) any investment, loan or advance by the Company or any
Guarantor in or to any Subsidiary that is not a Guarantor; provided that
each investment, loan or advance referred to in the preceding clause (iv)
must be in an outstanding principal amount which, together with the
aggregate outstanding principal amount of all other investments, loans and
advances permitted by such clause (iv), shall not exceed $100,000,000 at
any time and (v) any investment, loan or advance by the Company or a
Guarantor to any Subsidiary that is not a Guarantor (whether directly or
indirectly through one or more intervening Subsidiaries that is not a
Guarantor) and the business operations of which are in China, South Korea
or Brazil; provided that each investment, loan or advance referred to in
the preceding clause (v) must be in an outstanding principal amount which,
together with the aggregate outstanding principal amount of all other
investments, loans and advances permitted by such clause (v), shall not
exceed $150,000,000 at any time;".
6. Amendment to Section 6H of the Note Agreement (Leverage Ratio).
Section 6H of the Note Agreement is hereby amended, as of the Amendment
Effective Date, by deleting the text therein in its entirety and inserting in
lieu thereof the following text:
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"6H. Leverage Ratio. The Company will not permit the Leverage Ratio (i) on
any date during any Material Acquisition Period to exceed 3.50 to 1.00, and (ii)
on any other date, to exceed 3.00 to 1.00."
7. Amendment to Section 6I of the Note Agreement (Interest Coverage
Ratio). Section 6I of the Note Agreement is hereby amended, as of the Amendment
Effective Date, by deleting the text therein in its entirety and inserting in
lieu thereof the following text:
"The Company will not permit the ratio of (i) Consolidated EBITDA for any
period of four consecutive fiscal quarters to (ii) Consolidated Interest
Expense during such four fiscal quarter period to be less than 3.00 to
1.00".
8. Amendment to Section 11B of the Note Agreement (Other Terms).
Section 11B of the Note Agreement is hereby amended, as of the Amendment
Effective Date, as follows: (a) the definition of "Consolidated Tangible Net
Worth" is hereby amended by deleting the date that reads "September 30, 2003"
and inserting in lieu thereof the date "December 31, 2005"; and (b) the
definition section is hereby further amended, as follows: (i) by adding the
following defined term and definition in its entirety, in its appropriate,
respective position determined by alphabetical order:
"Material Acquisition Period" means each period of six consecutive
fiscal quarters of the Company commencing with the fiscal quarter in which
one or more of the Company and a Subsidiary has consummated (i) one or
more acquisitions of Equity Interests in Persons that become Subsidiaries
upon such acquisition or (ii) one or more acquisitions from a Person or a
business; provided, that the aggregate consideration paid for any such
acquisitions pursuant to (including, without limitation, Indebtedness of
the new Subsidiary and, without duplication, any Indebtedness of such
Persons that is assumed by any one or more of the Company and/or a
Subsidiary), taken together with the aggregate consideration (including
assumed Indebtedness as aforesaid) paid for all other such acquisitions
consummated during the immediately preceding three fiscal quarters of the
Company, is equal to at least $250,000,000." and
(ii) by deleting the definitions of "Adjusted Net Proceeds" and "Pro Rata
Prepayment" in their entirety, and inserting in lieu thereof, in their
appropriate, respective position determined by alphabetical order, the following
new definitions:
""Adjusted Net Proceeds" in respect of any Pro Rata Prepayment Event
means an amount equal to the product of (a) 75% of the Net Proceeds (as
defined in the Revolving Credit Agreement) of the associated Prepayment
Event (as defined in the Revolving Credit Agreement), and (b) a fraction,
the numerator of which is aggregate outstanding principal balance of the
Notes and the denominator of which is the numerator plus the Aggregate
Revolving Credit Exposure (as defined in the Revolving Credit Agreement)
calculated as of the date of the Prepayment event giving rise to such Net
Proceeds."
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"Pro Rata Prepayment" shall mean a prepayment of the Notes in an
aggregate amount equal to the Adjusted Net Proceeds in respect of the
applicable Pro Rata Prepayment Event."
9. Representations and Warranties. The Company and each other
Guarantor hereby:
(a) other than such representations expressly given as of a specific
date, repeats (and confirms as true and correct) as of the Amendment Effective
Date to the Purchasers that each of the representations and warranties made by
the Company and each other Guarantor pursuant to the Note Agreement and are
hereby incorporated herein (as though set forth herein) in their entirety; and
(b) further represent and warrant as of the Amendment Effective Date
that: (i) No Default. No Default or Event of Default shall have occurred and be
continuing on such date after giving effect to this Amendment;
(ii) Power and Authority. Each such Person has the corporate or
equivalent power to execute and deliver this Amendment, and to perform the
provisions hereof, and this Amendment has been duly authorized by all necessary
corporate or equivalent action on the part of each such Person;
(iii) Due Execution. This Amendment has been duly executed and
delivered by such Person and constitutes such Person's legal, valid and binding
obligation, enforceable in accordance with its terms, except as such
enforceability may be limited (x) by general principles of equity and conflicts
of laws or (y) by bankruptcy, reorganization, insolvency, moratorium or other
laws of general application relating to or affecting the enforcement, of
creditors' rights;
(iv) No Consent's Required. No consent, approval, authorization or
order of, or filing, registration or qualification with, any court or
Governmental Authority or third party is required in connection with the
execution, delivery or performance by such Person of this Amendment;
(v) Acknowledgement of Obligation; Waiver of Claims. It has no
defenses, offsets or counterclaims against any of its obligations under or in
respect to the Note Agreement, the Notes or the AI Guaranty Agreement and that
all amounts outstanding under and in respect to the Notes and the Note Agreement
are owing to holders of the Notes without defense, offset or counterclaim; and
(vi) Revolving Credit Agreement. Other than (A) that certain
restatement dated as of April 14, 2006 and (B) the First Amendment dated as of
August 28, 2006, there have been no amendments to the Revolving Credit
Agreement.
10. Acknowledgements and Consent of Guarantors. Each Guarantor
hereby acknowledges that it has reviewed the terms and provisions of the Note
Agreement, the Notes, the AI Guaranty Agreement and this Amendment and consents
to the amendment to Note Agreement effected pursuant to this Amendment. Each
Guarantor confirms that they will
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continue to guarantee the obligations to the fullest extent in accordance with
the AI Guaranty Agreement and acknowledges and agrees that: (a) the AI Guaranty
Agreement shall continue in full force and effect and that its obligations
thereunder shall be valid and enforceable and shall not be impaired or limited
by the execution or effectiveness of this Amendment; and (b)(i) notwithstanding,
the conditions to effectiveness hereof, such Guarantor is not required by the
terms of the Note Agreement, the Notes or the AI Guaranty Agreement to consent
to the amendments to the Note Agreement effected pursuant to this Amendment; and
(ii) nothing in Note Agreement, the Notes or AI Guaranty Agreement shall be
deemed to require the consent of any such Guarantor to any future amendments to
the Note Agreement.
11. Conditions Precedent. This Amendment shall become effective as
of August __, 2006 provided the conditions precedent set forth below shall have
been fulfilled (the "Amendment Effective Date") and shall constitute a
Transaction Document:
(a) the Purchasers shall have received counterparts of this
Amendment, executed and delivered by a duly authorized officer of each of the
parties hereto;
(b) the Purchasers shall have received such additional documents or
certificates with respect to legal matters or corporate or other proceeding
related to the transactions contemplated hereby as may be reasonable requested
by the Purchasers on or prior to August 17, 2006;
(c) the representations and warranties contained in Section 10 above
shall be true and correct in all material respects on and as of the Amendment
Effective Date, as if made on and as of the Amendment Effective Date and there
shall exist on the Amendment Effective Date no Event of Default or Default;
(d) the Company shall have paid the Purchasers (and the Purchasers
shall have received) on the date hereof a fee in the amount of $20,000; and
(e) the Company and each other Guarantor shall have made all
requests, filings and registrations with, and obtained all consents and
approvals from, the relevant national, state, local or foreign jurisdiction(s),
or any administrative, legal or regulatory body or agency thereof, that are
necessary for the Company and each other Guarantor in connection with this
Amendment and any and all other documents relating hereto.
12. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
13. No Other Amendments; Confirmation. Except as expressly amended,
modified and supplemented hereby, the terms, provisions and conditions of the
Note Agreement, the Notes, the AI Guaranty Agreement and the agreements and
instruments relating thereto are and shall remain unchanged and in full force
and effect and are hereby ratified and confirmed in all respects.
14. Headings. The headings of sections of this Amendment are
inserted for convenience only and shall not be deemed to constitute a part of
this Amendment.
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15. Counterparts. This Amendment may be executed in any number of
counterparts by the parties hereto, each of which counterparts when so executed
shall be an original, but all counterparts taken together shall constitute one
and the same instrument.
[Remainder of page intentionally left blank. Signature pages follow.]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be
duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.
ALBANY INTERNATIONAL CORP.
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Corporate Treasurer
ALBANY INTERNATIONAL HOLDINGS TWO, INC.,
as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: VP, Asst. Secretary
ALBANY INTERNATIONAL TECHNIWEAVE, INC.,
as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Treasurer, Asst. Secretary
ALBANY INTERNATIONAL RESEARCH CO.,
as a Guarantor
By: /s/ Xxxxxxx X. Xxxxx, Xx.
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Name: Xxxxxxx X. Xxxxx, Xx.
Title: VP, Asst. Treasurer
GESCHMAY CORP., as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: VP, Asst. Secretary
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XXXXXXX DRYING FABRICS, INC.,
as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: VP, Asst. Secretary
GESCHMAY WET XXXXX, INC., as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: VP, Asst. Secretary
GESCHMAY FORMING FABRICS CORP.,
as a Guarantor
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
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Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: VP, Asst. Secretary
The foregoing Amendment is hereby
accepted as of the date first above written.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
By: /s/ Xxxxxxxxxxx Xxxxx
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Name: Xxxxxxxxxxx Xxxxx
Title: Vice President
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THE PRUDENTIAL LIFE INSURANCE COMPANY, LTD.
By: Prudential Investment Management (Japan), Inc.,
as Investment Manager
By: Prudential Investment Management, Inc.,
as Sub-Adviser
By: /s/ Xxxxxxxxxxx Xxxxx
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Name: Xxxxxxxxxxx Xxxxx
Title: Vice President
GIBRALTAR LIFE INSRUANCE CO. LTD.,
By: Prudential Investment Management (Japan), Inc.,
as Investment Manager
By: Prudential Investment Management, Inc.,
as Sub-Adviser
By: /s/ Xxxxxxxxxxx Xxxxx
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Name: Xxxxxxxxxxx Xxxxx
Title: Vice President
SECURITY BENEFIT LIFE INSURANCE COMPANY, INC.
By: Prudential Private Placement Investors, L.P.
(as Investment Advisor)
By: Prudential Private Placement Investors, L.P.
(as General Partner)
By: /s/ Xxxxxxxxxxx Xxxxx
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Name: Xxxxxxxxxxx Xxxxx
Title: Vice President
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