Exhibit 10.2
JPMorgan [LOGO]
JPMorgan Chase Bank, N.A.
P.O. Box 161
60 Victoria Embankment
London EC4Y 0JP
England
March 23, 2006
To: Albany International Corp.
1373 Broadway
Albany, New York 12204
Attention: David Michaels
Telephone No.: (518) 445-2212
Facsimile No.: (518) 447-6305
Re: Warrants Transaction Amendment
This letter agreement (the "Amendment") amends the terms and conditions of
the Transaction (the "Transaction") entered into between JPMorgan Chase Bank,
N.A., London Branch ("JPMorgan"), and Albany International Corp., a Delaware
corporation (the "Company"), pursuant to a letter agreement dated March 7, 2006
(the "Confirmation"), pursuant to which JPMorgan has purchased from the Company
a Number of Warrants equal to 2,061,993. This Amendment relates to, and sets
forth the terms of, the purchase by JPMorgan from the Company of an additional
Number of Warrants (the "Additional Number of Warrants").
Upon the effectiveness of this Amendment, all references in the
Confirmation to the "Number of Warrants" will be deemed to be to the Number of
Warrants, as amended hereby and all references in the Confirmation to the
"Transaction" will be deemed to be to the Transaction as amended hereby. Except
to the extent specified below, all other provisions of the Confirmation shall
apply to the Additional Number of Warrants as if such Additional Number of
Warrants were originally subject to the Confirmation. Capitalized terms used
herein without definition shall have the meanings assigned to them in the
Confirmation.
Amendments. The terms relating to the purchase by JPMorgan of the Additional
Number of Warrants are as follows:
1. The "Trade Date" with respect to the Additional Number of Warrants will be
March 23, 2006.
2. The "Number of Warrants" for the Transaction will be "2,474,392" reflecting
an increase of 412,399 Warrants.
3. An additional "Premium" to be determined by the Calculation Agent will be
payable by JPMorgan to the Company with respect to the Additional Number of
Warrants (the "Additional Warrant Premium") on a Currency Business Day to be
specified by the Calculation Agent (such date, the "Additional Warrant Premium
Payment Date") by written notice to the Company in substantially the form of the
pricing supplement set forth in Exhibit A hereto (the "Pricing Supplement") no
later than one Currency Business Day prior to the Additional Warrant Premium
Payment Date.
Repeated Representations. The Company hereby repeats the representations and
warranties set forth in Section 8 and Sections 9(f), (g) and (h) of the
Confirmation; provided that the Company shall be deemed to
JPMorgan Chase Bank, National Association
Organised under the laws of the United States as a National Banking Association
Main Office 1111 Polaris Parkway, Columbus, Ohio 43271
Registered as a branch in England & Wales branch No. BR000746
Registered Branch Office 125 London Wall, London EC2Y 5AJ
Authorised and regulated by the Financial Services Authority
repeat the representation contained in Section 8(e) of the Confirmation on each
day during the period beginning on the date hereof and ending on the Additional
Warrant Premium Payment Date.
Rule 10b-18. The Company further represents that, except as disclosed by the
Company to JPMorgan or as described in the offering memorandum relating to the
Convertible Notes, neither the Company nor any of its affiliates has purchased
any Shares (as contemplated by Rule 10b-18 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) during each of the four calendar weeks
preceding the date hereof. The Company further covenants and agrees that neither
it nor any of its affiliates will purchase any Shares prior to earlier of the
Additional Warrant Premium Payment Date and the Early Unwind Date (as defined
below).
Conditionality and Early Unwind. The respective obligations of the parties
hereunder shall become final and binding only if no Early Unwind Event (as
defined below) shall have occurred and be continuing as of the Early Unwind Date
(as defined below). Notwithstanding the foregoing, the Company and JPMorgan,
intending to be legally bound, hereby acknowledge and agree that in the event
that an Early Unwind Event has occurred and is continuing on the Early Unwind
Date, JPMorgan or one or more of its affiliates, shall terminate its hedging
activities with respect to the portion of the Transaction contemplated by this
Amendment on the Early Unwind Date and each party shall be released and
discharged by the other parties from, and agrees not to make any claim against
the other parties with respect to, any obligations or liabilities of the other
parties arising out of and to be performed in connection with such portion of
the Transaction; provided that, if such Early Unwind Event results from a breach
by the Company of any representation of or any undertaking by the Company
contained in the Purchase Agreement and relating to the issuance by the Company
of additional USD 30,000,000 principal amount of Convertible Notes (the
"Additional Convertible Notes"), the Company shall purchase from JPMorgan on the
Early Unwind Date any Shares purchased by JPMorgan or one or more of its
affiliates in connection with the portion of the Transaction contemplated by
this Amendment and reimburse JPMorgan for any costs or expenses (including
market losses) relating to the unwinding of its reasonable hedging activities in
connection with such portion of the Transaction (including any losses or costs
incurred as a result of its terminating, liquidating, obtaining or
reestablishing any reasonable hedge or related trading position). The amount of
any such reimbursement shall be determined by JPMorgan in its reasonable good
faith discretion. JPMorgan shall notify the Company of such amount, including,
upon the Company's request, an explanation of the basis of determination of such
amount, and the Company shall pay such amount in immediately available funds on
the Early Unwind Date.
For purposes of the foregoing: (i) an "Early Unwind Event" means (a) the failure
to close the Additional Convertible Notes issuance by the Early Unwind Date for
any reason whatsoever or (b) the failure of the Company to comply with any
representations, warranties or undertakings contained in this Amendment; and
(ii) an "Early Unwind Date" means March 28, 2006 or such later date as agreed
upon by the parties.
No Additional Amendments or Waivers. Except as amended hereby, all the terms of
the Transaction and provisions in the Confirmation shall remain and continue in
full force and effect and are hereby confirmed in all respects.
Counterparts. This Amendment may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if all of the signatures
thereto and hereto were upon the same instrument.
Governing Law. The provisions of this Amendment shall be governed by the New
York law (without reference to choice of law doctrine).
Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing this Amendment and returning it in the manner indicated
in the attached cover letter.
Very truly yours,
J.P. Morgan Securities Inc., as agent for
JPMorgan Chase Bank, National Association
By: /s/ Sudheer Tegulapelle
Authorized Signatory
Name: Sudheer Tegulapelle
Accepted and confirmed
as of the Trade Date:
ALBANY INTERNATIONAL CORP.
By: /s/ David C. Michaels
Authorized Signatory
Name: David C. Michaels
- --------------------------------------------------------------------------------
Bank of America(R) [LOGO]
EQUITY FINANCIAL PRODUCTS GROUP
- --------------------------------------------------------------------------------
Bank of America, N.A.
c/o Banc of America Securities LLC
9 West 57th Street, 40th Floor
New York, NY 10019
March 23, 2006
To: Albany International Corp.
1373 Broadway
Albany, New York 12204
Attention: David Michaels
Telephone No.: (518) 445-2212
Facsimile No.: (518) 447-6305
Re: Warrants Transaction Amendment (Ref. No.: NY-21552)
This letter agreement (the "Amendment") amends the terms and conditions of
the Transaction (the "Transaction") entered into between Bank of America, N.A.
("BofA"), and Albany International Corp., a Delaware corporation (the
"Company"), pursuant to a letter agreement dated March 7, 2006 (the
"Confirmation"), pursuant to which BofA has purchased from the Company a Number
of Warrants equal to 1,374,662. This Amendment relates to, and sets forth the
terms of, the purchase by BofA from the Company of an additional Number of
Warrants (the "Additional Number of Warrants").
Upon the effectiveness of this Amendment, all references in the
Confirmation to the "Number of Warrants" will be deemed to be to the Number of
Warrants, as amended hereby and all references in the Confirmation to the
"Transaction" will be deemed to be to the Transaction as amended hereby. Except
to the extent specified below, all other provisions of the Confirmation shall
apply to the Additional Number of Warrants as if such Additional Number of
Warrants were originally subject to the Confirmation. Capitalized terms used
herein without definition shall have the meanings assigned to them in the
Confirmation.
Amendments. The terms relating to the purchase by BofA of the Additional Number
of Warrants are as follows:
1. The "Trade Date" with respect to the Additional Number of Warrants will be
March 23, 2006.
2. The "Number of Warrants" for the Transaction will be "1,649,594" reflecting
an increase of 274,932 Warrants.
3. An additional "Premium" to be determined by the Calculation Agent will be
payable by BofA to the Company with respect to the Additional Number of Warrants
(the "Additional Warrant Premium") on a Currency Business Day to be specified by
the Calculation Agent (such date, the "Additional Warrant Premium Payment Date")
by written notice to the Company in substantially the form of the pricing
supplement set forth in Exhibit A hereto (the "Pricing Supplement") no later
than one Currency Business Day prior to the Additional Warrant Premium Payment
Date.
Repeated Representations. The Company hereby repeats the representations and
warranties set forth in Section 8 and Sections 9(f), (g) and (h) of the
Confirmation; provided that the Company shall be deemed to repeat the
representation contained in Section 8(e) of the Confirmation on each day during
the period beginning on the date hereof and ending on the Additional Warrant
Premium Payment Date.
Rule 10b-18. The Company further represents that, except as disclosed by the
Company to BofA or as described in the offering memorandum relating to the
Convertible Notes, neither the Company nor any of its affiliates has purchased
any Shares (as contemplated by Rule 10b-18 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) during each of the four calendar weeks
preceding the date hereof. The Company further covenants and agrees that neither
it nor any of its affiliates will purchase any Shares prior to earlier of the
Additional Warrant Premium Payment Date and the Early Unwind Date (as defined
below).
Conditionality and Early Unwind. The respective obligations of the parties
hereunder shall become final and binding only if no Early Unwind Event (as
defined below) shall have occurred and be continuing as of the Early Unwind Date
(as defined below). Notwithstanding the foregoing, the Company and BofA,
intending to be legally bound, hereby acknowledge and agree that in the event
that an Early Unwind Event has occurred and is continuing on the Early Unwind
Date, BofA or one or more of its affiliates, shall terminate its hedging
activities with respect to the portion of the Transaction contemplated by this
Amendment on the Early Unwind Date and each party shall be released and
discharged by the other parties from, and agrees not to make any claim against
the other parties with respect to, any obligations or liabilities of the other
parties arising out of and to be performed in connection with such portion of
the Transaction; provided that, if such Early Unwind Event results from a breach
by the Company of any representation of or any undertaking by the Company
contained in the Purchase Agreement and relating to the issuance by the Company
of additional USD 30,000,000 principal amount of Convertible Notes (the
"Additional Convertible Notes"), the Company shall purchase from BofA on the
Early Unwind Date any Shares purchased by BofA or one or more of its affiliates
in connection with the portion of the Transaction contemplated by this Amendment
and reimburse BofA for any costs or expenses (including market losses) relating
to the unwinding of its reasonable hedging activities in connection with such
portion of the Transaction (including any losses or costs incurred as a result
of its terminating, liquidating, obtaining or reestablishing any reasonable
hedge or related trading position). The amount of any such reimbursement shall
be determined by BofA in its reasonable good faith discretion. BofA shall notify
the Company of such amount, including, upon the Company's request, an
explanation of the basis of determination of such amount, and the Company shall
pay such amount in immediately available funds on the Early Unwind Date.
For purposes of the foregoing: (i) an "Early Unwind Event" means (a) the failure
to close the Additional Convertible Notes issuance by the Early Unwind Date for
any reason whatsoever or (b) the failure of the Company to comply with any
representations, warranties or undertakings contained in this Amendment; and
(ii) an "Early Unwind Date" means March 28, 2006 or such later date as agreed
upon by the parties.
No Additional Amendments or Waivers. Except as amended hereby, all the terms of
the Transaction and provisions in the Confirmation shall remain and continue in
full force and effect and are hereby confirmed in all respects.
Counterparts. This Amendment may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if all of the signatures
thereto and hereto were upon the same instrument.
Governing Law. The provisions of this Amendment shall be governed by the New
York law (without reference to choice of law doctrine).
Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing this Amendment and returning it in the manner indicated
in the attached cover letter.
Very truly yours,
Bank of America, N.A.
By: /s/ Eric P. Hambleton
Authorized Signatory
Name: Eric P. Hambleton
Accepted and confirmed
as of the Trade Date:
ALBANY INTERNATIONAL CORP.
By: /s/ David C. Michaels
Authorized Signatory
Name: David C. Michaels