Changes in specially permitted capital expenditures for Brazil, such that the permitted amounts are $4.6 million for 2006, $8.2 million for 2007 and $3.8 million for 2008.
Additionally, the permitted use of these capital expenditures is altered to include all production capacity expansion projects in Brazil.
The applicable margin on the revolving and term loans is increased by 0.25 percent and subject to a further increase of an additional 0.25 percent in the event that the indebtedness under the senior credit facility is rated lower than B1 by Moody's or lower than B+ by Standard & Poor's.
The Company paid an amendment fee of $1,420,139.40 in connection with the amendment.
Xerium also announced that it expects to establish a dividend reinvestment plan (DRIP) during the first quarter of 2007.
Thomas Gutierrez, Xerium's Chief Executive Officer, said, "We are pleased to have secured additional financial flexibility through the amendment to our senior credit facility and to have received the commitment from the Apax entities to reinvest cash dividends received in 2007 in our common stock through a dividend reinvestment plan as described above."
He added, "While we believe that the credit facility amendment and the commitment of the Apax entities improve our ability to pay dividends in 2007 under the credit facility, we expect to evaluate our dividend policy very closely each quarter, as we move forward, to ensure thatkey growth investments and our ability to continue to reduce debt are treated as main priorities."
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