10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________

FORM 10-Q

________________________

ý Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2014

Or

¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from             to             

Commission File Number 001-32498

________________________

Xerium Technologies, Inc.

(Exact name of registrant as specified in its charter)

________________________

DELAWARE	42-1558674
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
14101 Capital Boulevard Youngsville, North Carolina	27596
(Address of principal executive offices)	(Zip Code)

(919) 526-1400

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	£		Accelerated filer	x
Non-accelerated filer	£	(Do not check if a smaller reporting company)	Smaller reporting company	£

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange

Act).    Yes  ¨    No  ý

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.    Yes  ý    No  ¨

The number of shares of the registrant’s common stock, $0.001 par value, outstanding as of May 5, 2014 was 15,410,122.

TABLE OF CONTENTS

Part I. Financial Information
		Page
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	32
Part II. Other Information
Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 6.	Exhibits	33

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Xerium Technologies, Inc.

Consolidated Balance Sheets

(Dollars in thousands)

	March 31, 2014 (Unaudited)			December 31, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	18,013		$	25,716
Accounts receivable, net	94,620			87,952
Inventories, net	88,295			83,930
Prepaid expenses	6,573			8,179
Other current assets	14,402			15,695
Total current assets	221,903			221,472
Property and equipment, net	316,853			309,664
Goodwill	67,936			68,975
Intangible assets	14,265			14,470
Other assets	10,106			9,483
Total assets	$	631,063		$	624,064
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Notes payable	$	8,243		$	8,267
Accounts payable	37,873			42,220
Accrued expenses	69,138			61,368
Current maturities of long-term debt	2,204			2,166
Total current liabilities	117,458			114,021
Long-term debt, net of current maturities	433,771			432,706
Liabilities under capital leases	4,324			—
Deferred taxes	15,789			16,350
Pension, other post-retirement and post-employment obligations	66,727			66,866
Other long-term liabilities	4,747			5,570
Commitments and contingencies (Note 9)
Stockholders’ deficit
Preferred stock, $0.001 par value, 1,000,000 shares authorized; no shares outstanding as of March 31, 2014 and December 31, 2013	—			—
Common stock, $0.001 par value, 20,000,000 shares authorized; 15,410,122 and 15,383,903 shares outstanding as of March 31, 2014 and December 31, 2013, respectively	15			15
Stock warrants	13,532			13,532
Paid-in capital	415,194			414,742
Accumulated deficit	(408,519		)	(409,686		)
Accumulated other comprehensive loss	(31,975		)	(30,052		)
Total stockholders’ deficit	(11,753		)	(11,449		)
Total liabilities and stockholders’ deficit	$	631,063		$	624,064

See accompanying notes.

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Xerium Technologies, Inc.

Consolidated Statements of Operations and Comprehensive (Loss) Income (Unaudited)

(Dollars in thousands, except per share data)

	Three Months Ended March 31,
	2014			2013
Net Sales	$	133,384		$	139,805
Costs and expenses:
Cost of products sold	81,218			85,298
Selling	18,178			19,221
General and administrative	14,797			14,634
Research and development	1,946			1,954
Restructuring	4,651			1,255
	120,790			122,362
Income from operations	12,594			17,443
Interest expense, net	(8,657		)	(9,206		)
Foreign exchange loss	(877		)	(249		)
Income before provision for income taxes	3,060			7,988
Provision for income taxes	(1,893		)	(2,503		)
Net income	$	1,167		$	5,485
Comprehensive (loss) income	$	(758	)	$	2,727
Net income per share:
Basic	$	0.08		$	0.36
Diluted	$	0.07		$	0.36
Shares used in computing net income per share:
Basic	15,391,391			15,312,523
Diluted	16,371,772			15,381,204

See accompanying notes.

4

Xerium Technologies, Inc.

Consolidated Statements of Cash Flows—(Unaudited)

(Dollars in thousands)

	Three Months Ended March 31,
	2014			2013
Operating activities
Net income	$	1,167		$	5,485
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation	509			295
Depreciation	8,233			8,966
Amortization of intangibles	416			576
Deferred financing cost amortization	716			709
Foreign exchange gain on revaluation of debt	(1,103		)	(118		)
Deferred tax expense	(808		)	282
Asset impairment	—			928
(Loss) Gain on disposition of property and equipment	27			(10		)
Provision for doubtful accounts	245			35
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(7,052		)	(9,227		)
Inventories	(4,048		)	928
Prepaid expenses	1,600			452
Other current assets	819			(1,963		)
Accounts payable and accrued expenses	4,202			2,946
Deferred and other long-term liabilities	(2,160		)	(1		)
Net cash provided by operating activities	2,763			10,283
Investing activities
Capital expenditures, gross	(10,494		)	(3,713		)
Proceeds from disposals of property and equipment	43			317
Net cash used in investing activities	(10,451		)	(3,396		)
Financing activities
Proceeds from borrowings	7,580			—
Principal payments on debt	(6,600		)	(603		)
Payment of financing fees	(710		)	—
Payment of obligations under capital leases	(190		)	—
Net cash provided by (used) in financing activities	80			(603		)
Effect of exchange rate changes on cash flows	(95		)	(298		)
Net (decrease) increase in cash	(7,703		)	5,986
Cash and cash equivalents at beginning of period	25,716			34,777
Cash and cash equivalents at end of period	$	18,013		$	40,763
Non-cash capitalized lease asset and liability	$	4,468		$	—

See accompanying notes.

5

Xerium Technologies, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

(Dollars in thousands, except per share data)

1. Description of Business and Significant Accounting Policies

Description of Business

Xerium Technologies, Inc. (the "Company") is a leading global provider of industrial consumables and mechanical services used in the production of paper, paperboard, building products and nonwoven materials. Its operations are strategically located in the major paper-making regions of the world, including North America, Europe, South America and Asia-Pacific.

Basis of Presentation

The accompanying unaudited condensed consolidated interim financial statements at March 31, 2014 and for the three months ended March 31, 2014 and 2013 include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, such financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. The interim results presented herein are not necessarily indicative of the results to be expected for the entire year. In management’s opinion, these unaudited condensed consolidated interim financial statements contain all adjustments of a normal recurring nature necessary for a fair presentation of the financial statements for the interim periods presented.These unaudited consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2013 as reported on the Company's Annual Report on Form 10-K filed on March 4, 2014.

Accounting Policies

Inventories, net

Inventories are generally valued at the lower of cost or market using the first-in, first-out (FIFO) method. Raw materials are valued principally on a weighted average cost basis. The Company’s work in process and finished goods are specifically identified and valued based on actual inputs to production. Provisions are recorded as appropriate to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires management to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business, while considering the general aging of inventory and factoring in any new business conditions.

The components of inventories are as follows at:

	March 31, 2014			December 31, 2013
Raw materials	$	22,708		$	22,009
Work in process	31,907			28,414
Finished goods (includes consigned inventory of $8,815 at March 31, 2014 and $8,697 at December 31, 2013)	42,047			41,845
Inventory allowances	(8,367		)	(8,338		)
	$	88,295		$	83,930

Goodwill

The Company accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other Intangible Assets (“Topic 350”). Topic 350 requires that goodwill and intangible assets that have indefinite lives not be amortized, but instead, must be tested for impairment at least annually or whenever events or business conditions warrant. During the first quarter of 2014, the Company evaluated events and business conditions to determine if a test for an impairment of goodwill was warranted. No such events or business conditions took place during this period, therefore no test was determined to be warranted at March 31, 2014.

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Warranties

The Company offers warranties on certain rolls products that it sells. The specific terms and conditions of these warranties vary depending on the product sold, the country in which the product is sold and arrangements with the customer. The Company estimates the costs that may be incurred under its warranties and records a liability for such costs. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company periodically assesses the adequacy of its recorded warranty claims and adjusts the amounts as necessary. The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2014:

Beginning Balance		Charged to  Cost of Sales		Effect of Foreign Currency Translation			Deduction from Reserves			Ending Balance
$	1,629	$	327	$	(5	)	$	(422	)	$	1,529

Net Income Per Common Share

Net income per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net income per share is based on the weighted-average number of shares outstanding during the period. As of March 31, 2014 and 2013, the Company had outstanding restricted stock units (“RSUs”), deferred stock units (“DSUs”), warrants and options.

The following table sets forth the computation of basic and diluted weighted-average shares:

	Three Months Ended March 31,
	2014	2013
Weighted-average common shares outstanding–basic	15,391,391	15,312,523
Dilutive effect of stock-based compensation awards outstanding	980,381	68,681
Weighted-average common shares outstanding–diluted	16,371,772	15,381,204

Dilutive securities aggregating approximately 1.7 million and 2.5 million were outstanding for the three months ended March 31, 2014 and 2013, but were not included in the computation of diluted earnings per share for the three months ended March 31, 2014 because the impact of including such shares would be anti-dilutive to the earnings per share calculations.

Impairment

The Company reviews its long-lived assets that have finite lives for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment (“Topic 360”). This topic requires that companies evaluate the fair value of long-lived assets based on the anticipated undiscounted future cash flows to be generated by the assets when indicators of impairment exist to determine if there is impairment to the carrying value. Any change in the carrying amount of an asset as a result of the Company's evaluation has been recorded in either restructuring expense, if it was a result of the Company's restructuring activities, or general and administrative expense for all other impairments in the consolidated statements of operations. Impairment charges associated with restructuring are discussed in Note 7 "Restructuring Expense". In the first quarter of 2014, the Company had no impairment charges.

Reclassifications

During the first quarter of 2014, while implementing a new financial reporting system, the Company redesigned its chart of accounts in order to provide more consistent internal and external reporting globally. In addition to this change, the Company's corporate management organizational structure was changed from primarily a geographic regional management organization to a more centralized functional management organization. These changes drove certain changes in the mappings of the related accounts in the chart of accounts. As these changes are correctly presented in the 2014 consolidated financial statements, these changes resulted in reclassifications in both the Consolidated Balance Sheet at December 31, 2013 and the Consolidated Statement of Operations for the three months ended March 31, 2013. Management performed a SAB 99 "Materiality" analysis on these reclassifications, and determined the only reclassification material to the Company's consolidated financial statements as a whole was a $0.7 million reclassification from research and development expenses to selling expenses as a result of moving certain personnel from the research and development department to the selling department. This reclassification has been made in the Consolidated Statement of Operations for the three months ended March 31, 2013.

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New Accounting Standards

In July of 2013, FASB issued ASU 2013-11 Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Taskforce) ("ASU 2013-11"). Beginning January 1, 2014, the effective date of this regulation, the Company has adopted the provisions of ASU 2013-11 related to presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  The effect on the date of adoption resulted in a decrease in other long term liabilities and a decrease in other assets of $1.1 million related to uncertain tax benefits for Canada, Germany, and Italy.

2. Derivatives and Hedging

As required by ASC Topic 815, Derivatives and Hedging (“Topic 815”), the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability or firm commitment attributable to a particular risk are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge.

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. From time to time, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known cash amounts, the value of which are determined by interest rates or foreign exchange rates.

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company uses interest rate caps as part of its interest rate risk management strategy. Interest rate caps designated as cash flow hedges protect the Company from increases in interest rates above the strike rate of the interest rate cap. At March 31, 2014, the fair market value of the Company’s interest rate swaps were nominal amounts. Therefore, the financial statements were not exposed to the effects of interest rate fluctuations and these did not have a material impact on its results of operations.

Non-designated Hedges of Foreign Exchange Risk

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to foreign exchange rates, but do not meet the strict hedge accounting requirements of Topic 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly to earnings.

The Company, from time to time, may enter into foreign exchange forward contracts to fix currencies at specified rates based on expected future cash flows to protect against the fluctuations in cash flows resulting from sales denominated in foreign currencies. Additionally, to manage its exposure to fluctuations in foreign currency on intercompany balances and certain purchase commitments, the Company from time to time may use foreign exchange forward contracts.

As of March 31, 2014 and December 31, 2013, the Company had outstanding derivatives that were not designated as hedges in qualifying hedging relationships. The value of these contracts is recognized at fair value based on market exchange forward rates and is recorded in other assets or other liabilities on the Consolidated Balance Sheets. The following represents the fair value of these derivatives at March 31, 2014 and December 31, 2013 and the change in fair value included in foreign exchange gain in the first quarter of 2014 and 2013:

8

	March 31, 2014			December 31, 2013
Fair value of derivatives	$	(935	)	$	530
	Three Months Ended March 31, 2014:			Three Months Ended March 31, 2013:
Change in fair value included in foreign exchange (loss) gain for the three months ended March 31, 2014 and March 31, 2013	$	(1,211	)	$	103

The following represents the notional amounts of foreign exchange forward contracts at March 31, 2014:

	Notional Sold		Notional Purchased
Non-designated hedges of foreign exchange risk	$	28,596	$	(22,259	)

Fair Value of Derivatives Under ASC Topic 820

ASC Topic 820, Fair Value Measurements and Disclosures (“Topic 820”), emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, Topic 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs including fair value of investments that do not have the ability to redeem at net asset value as of the measurement date, or during the first quarter following the measurement date. The derivative assets or liabilities are typically based on an entity’s own assumptions, as there is little, if any, market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and the Company considers factors specific to the asset or liability. The Company determined that its derivative valuations, which are based on market exchange forward rates, fall within Level 2 of the fair value hierarchy.

3. Long-term Debt

At March 31, 2014 and December 31, 2013, long-term debt consisted of the following:

	March 31, 2014		December 31, 2013
Senior secured term loan facility, payable quarterly, U.S. Dollar denominated–LIBOR (minimum 1.25%) plus 4.50% (5.75%) net of $0.9 million discount. Matures May of 2018.	$	197,639	$	198,000
Senior Notes (Unsecured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 8.875%, matures June of 2018	236,410		236,410
Other long term debt	1,926		462
	435,975		434,872
Less current maturities	2,204		2,166
Total	$	433,771	$	432,706

On May 17, 2013 (the "Closing Date"), the Company entered into a Credit and Guaranty Agreement for a $200.0 million term loan credit facility (the “Term Credit Facility”), net of a discount of $1.0 million, among the Company, certain direct an

9

d indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions. The Company also entered into a Revolving Credit and Guaranty Agreement originally for a $40.0 million asset-based revolving credit facility subject to a borrowing base among the Company, Xerium Canada Inc., as Canadian borrower, certain direct and indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions (the "Domestic Revolver"). On March 3, 2014, the Company entered into an amendment to the Revolving Credit and Guaranty Agreement (as amended, the “ABL Facility,” and collectively with the Term Credit Facility, the “Credit Facility”) to add the Company's German subsidiaries as European Borrowers and to provide for an additional $15 million European asset-based revolving credit facility subject to a European borrowing base (the "European Revolver"), increasing the aggregate availability under the ABL Facility to $55 million.

The Term Credit Facility provides for:

• a six-year $200 million senior secured term loan facility, provided the facility would mature in March 2018 if any of the Company's 8.875% senior unsecured notes due 2018 in the aggregate principal amount of $240 million (the “Notes”) remain outstanding at that time;

• an uncommitted accordion option (the “Incremental Facility”) allowing for increases for borrowings under the Term Credit Facility with the same terms, and borrowing of new tranches of term loans, up to an aggregate principal amount equal to (i) $75 million plus (ii) an additional amount (the “Facility Increase”) provided, if after giving effect to such Facility Increase (as well as any other additional term loans), on a pro forma basis, the Senior Secured Leverage Ratio (as defined in the Term Credit Facility) for the most recent four consecutive fiscal quarters does not exceed 2.25:1; and

• in connection with the amendment to the ABL Facility, the Term Credit Facility was amended to permit the ABL Facility to be further increased by an additional $10 million, to a total aggregate availability of not more than $65 million, provided that if the ABL Facility is increased beyond $55 million, certain baskets for additional indebtedness and liens otherwise available to the Company under the Term Loan Facility will be reduced dollar-for-dollar by any additional increase to the ABL Facility.

The Domestic Revolver provides for a $40 million senior secured revolving credit facility with a $20 million sub-limit on letters of credit. The European Revolver provides for a $15 million senior secured revolving credit facility with a $10 million sub-limit on letters of credit. Availability under both the Domestic Revolver and the European Revolver is subject to a borrowing base that is based on a specified percentage of eligible accounts receivable and inventory. The term of the ABL Facility is five years, provided that if any of the Notes remain outstanding in March 2018, the ABL Facility would mature at that time.

The Company used the borrowings under the Term Credit Facility to refinance all of its outstanding indebtedness under its previously existing senior secured term loan and revolving credit facility entered into in 2011 (the "2011 Credit Facility"). The Company intends to draw upon the ABL Facility from time-to-time for working capital and general corporate purposes.

The Term Credit Facility will require the Company to make amortization payments (payable in quarterly installments) equal to 1% of principal per annum with respect to the Term Credit Facility with the remaining amount due at final maturity. Voluntary prepayments will be permitted, in whole or in part, subject to minimum prepayment requirements; provided that prepayments made prior to the date that is six months after the Closing Date of the Term Credit Facility for the purpose of repricing or effectively repricing the term loan facilities must include a 1.0% prepayment premium; provided, further, that voluntary prepayments of loans bearing interest at the London Interbank Offered Rate (“LIBOR”) on a date other than the last day of the relevant interest period will be subject to the payment of customary breakage costs.

If the total amount of advances outstanding under the ABL Facility exceeds either $40 million or the borrowing base, the Company must repay an amount equal to the excess borrowing. If obligations under all outstanding letters of credit exceeds $20 million, the Company must cash collateralize its letters of credit in an amount equal to the excess obligations outstanding. Similarly, if the total amount of advances outstanding under the European Revolver exceed either $15 million or the European

borrowing base, the Company must repay an amount equal to the excess borrowing. If obligations under all outstanding

European-based letters of credit exceeds $10 million, the Company must cash collateralize its letters of credit in an amount

equal to the excess obligations outstanding.

The interest rates under the Term Credit Facility will be calculated, at the Company's option, at either the base rate or LIBOR, plus a margin of 4.00% and 5.00%, respectively. Each of the base rate and LIBOR shall be subject to a minimum of 2.25% and 1.25%, respectively. If the Company's Senior Secured Leverage Ratio (as defined in the Credit Facility) is less than 2.00:1 at any quarterly determination date, then the margins over the base rate and LIBOR will be 3.50% and 4.50%, respectively.

Depending on whether advances are made in U.S. Dollars or Canadian Dollars, interest rates under the Domestic Revolver will be calculated, at our option, at either a U.S.-based or Canadian-based base rate ("Base Rate Loans") or LIBOR or the Canadian Dealer Offered Rate ("CDOR") (each, "Fixed Rate Loans"), respectively, plus a margin of 0.75% for Base Rate Loans and a margin of 1.75% for Fixed Rate Loans. If we draw advances on the Domestic Revolver that are equal to or greater than 33.3% but less 66.7% of the $40 million limit, then the margins on Base Rate Loans and Fixed Rate Loans increase to

10

1.00% and 2.00%, respectively. The margins rise to 1.25% and 2.25%, respectively, if advances under the Domestic Revolver are equal to or greater than 66.7% of the $40 million limit. Interest rates under the European Revolver will be calculated, at either LIBOR or Overnight LIBOR, plus a margin of 1.75%. If the European Borrowers draw advances on the European Revolver that are equal to or greater than 33.3% but less than 66.7% of the $15 million limit, then the margin increases to 2.00%. The margin rises to 2.25% if advances under the European Revolver are equal to or greater than 66.7% of the $15 million limit. In addition to paying interest on outstanding advances under the ABL Facility, we will be required to pay a commitment fee to the lenders in respect of the unutilized commitments at a rate equal to 0.50% per annum if advances under the ABL Facility are less than or equal to 50% of the commitments or a rate equal to 0.375% per annum if advances under the ABL are more than 50% of the commitments.

The obligations under the Credit Facility are guaranteed by all of our existing and future direct and indirect subsidiaries that are organized in the United States (subject to certain exceptions in the case of immaterial subsidiaries and joint ventures) and, (i) in the case of the Domestic Revolver, by Xerium Canada Inc. and any future Canadian subsidiaries, provided that non-U.S. guarantors will only be liable for obligations of Xerium Canada Inc. and any other Canadian borrowers and (ii) in the case of the European Revolver, by each other European Borrower, certain other of the Company’s European subsidiaries and any existing or future direct and indirect subsidiaries that become a party to the ABL Facility. The Term Credit Facility is secured by a first-priority perfected security interest in substantially all of the assets of the Company, Xerium Canada Inc. and such subsidiary guarantors (collectively, the “Loan Parties”), in each case, now owned or later acquired, except with respect to the Loan Parties' accounts receivables and inventory, which are secured by a second-priority interest. The ABL Facility is secured by a first-priority perfected security interest in the Loan Parties' accounts receivables and inventory, and a second-priority interest in substantially all of the Loan Parties' other assets. In each case, the security interests are subject to certain exceptions and legal and tax considerations and requirements, including that only 65% of the voting capital stock of the domestic Loan Parties' “first-tier” non-U.S. subsidiaries is required to be pledged in respect of the obligations of the Company and the U.S. guarantors under the Credit Facility.

The Credit Facility contains certain customary covenants that, subject to exceptions, restrict the Company's ability to, among other things:

•declare dividends or redeem or repurchase equity interests;

•prepay, redeem or purchase debt;

•incur liens and engage in sale-leaseback transactions;

•make loans and investments;

•incur additional indebtedness;

•amend or otherwise alter debt and other material agreements;

•make capital expenditures in excess of $42 million per fiscal year, subject to adjustment;

•engage in mergers, acquisitions and asset sales;

•transact with affiliates; and

•engage in businesses that are not related to the Company's existing business.

The Credit Facility eliminates the interest coverage and leverage coverage ratio maintenance tests that were contained in the Company's 2011 Credit Facility. However, the ABL Facility contains a springing Fixed Charge Coverage Ratio (as defined in the ABL Facility), which must be not less than 1.00:1 during periods in which our Global Excess Availability (as defined in the ABL Facility) falls below certain minimum thresholds.

The Credit Facility contains certain customary representations and warranties, affirmative covenants and events of default, including payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults and cross-acceleration to certain indebtedness, certain events of bankruptcy, certain triggering events under U.S. and, in the case of the ABL Facility, Canadian employee benefit plans, material judgments, actual or asserted failures of any guarantee or security document supporting the Credit Facility to be in full force and effect and a change of control. If an event of default occurs, the lenders under the Credit Facility would be entitled to take various enforcement actions, including acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor.

On May 26, 2011, the Company completed a refinancing transaction, which replaced certain of its then outstanding indebtedness with the Notes. The Notes contain customary covenants that, subject to certain exceptions, restrict its ability to enter into certain transactions and engage in certain activities. The Company has $236.4 million aggregate principal amount outstanding under the Notes. The Notes contain customary covenants that, subject to certain exceptions, restrict its ability to enter into certain transactions and engage in certain activities.

As of March 31, 2014, the outstanding balance of the Company's term debt under its Credit Facility and Notes was $434.0 million, which is net of a $0.9 million discount. In addition, as of March 31 2014, an aggregate of $37.5 million is available for additional borrowings under the ABL Facility. This availability represents a borrowing base of $49.9 million under the ABL

11

Facility less $12.4 million of that facility committed for letters of credit or additional borrowings. Additionally, at March 31, 2014, the Company had approximately $5.1 million available for borrowings under other small lines of credit.

As of March 31, 2014 and December 31, 2013, the carrying value of the Company’s long-term debt was $436.0 million and $434.9 million, respectively, and its fair value was approximately $455.0 million and $451.6 million, respectively. The Company determined the fair value of its debt utilizing significant other observable inputs (Level 2 of the fair value hierarchy).

Capitalized Lease Liabilities

As of March 31, 2014, the Company had capitalized lease liabilities totaling $4.3 million. These amounts represent the lease on the corporate headquarters and a software licensing agreement.

4. Income Taxes

The Company utilizes the asset and liability method for accounting for income taxes in accordance with ASC Topic 740, Income Taxes (“Topic 740”). Under Topic 740, deferred tax assets and liabilities are determined based on the difference between their financial reporting and tax basis. The assets and liabilities are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company reduces its deferred tax assets by a valuation allowance if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In making this determination, the Company evaluates all available information including the Company’s financial position and results of operations for the current and preceding years, as well as any available projected information for future years.

For the three months ended March 31, 2014, the provision for income taxes was $1,893 as compared to $2,503 for the three months ended March 31, 2013. The decrease in tax expense was primarily attributable to the geographic mix of earnings for those periods in the three months ended March 31, 2014. The provision for income taxes is primarily impacted by income earned in tax paying jurisdictions relative to income earned in non-tax paying jurisdictions. The majority of income recognized for purposes of computing the effective tax rate is earned in countries where the statutory income tax rates range from 15% to 39.43%; however, permanent income adjustments recorded against pre-tax earnings may result in an effective tax rate that is higher or lower than the statutory tax rate in these jurisdictions. The Company generates losses in certain jurisdictions for which no tax benefit is received, as the deferred tax assets in these jurisdictions (including the net operating losses) are fully reserved in the valuation allowance. For this reason, the Company recognizes minimal income tax expense or benefit in these jurisdictions, of which the most material jurisdictions are the United States, the United Kingdom and Australia. Due to these reserves, the geographic mix of the Company’s pre-tax earnings has a direct correlation with how high or low its annual effective tax rate is relative to consolidated earnings. As the Company continues to reorganize and restructure its operations, it is possible that deferred tax assets, for which no income tax benefit has previously been provided, may more likely than not become realized. The Company continues to evaluate future operations and will record an income tax benefit in the period where it believes it is more likely than not that the deferred tax asset will be able to be realized.

As of March 31, 2014, the Company had a gross amount of unrecognized tax benefit of $7,919, exclusive of interest and penalties. The unrecognized tax benefit increased by approximately $428 during the three months ended March 31, 2014, as a result of foreign currency effects, statute expirations, and ongoing changes in currently reserved positions as a result of new facts or information. The Company’s policy is to recognize interest and penalties related to income tax matters as income tax expense, which were immaterial for the three months ended March 31, 2014 and 2013. The tax years 2000 through 2013 remain open to examination in a number of the major tax jurisdictions to which the Company and its subsidiaries are subject. The Company believes that it has made adequate provisions for all income tax uncertainties.

In July of 2013, FASB issued ASU 2013-11 Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Taskforce) ("ASU 2013-11"). Beginning January 1, 2014, the effective date of this regulation, the Company has adopted the provisions of ASU 2013-11 related to presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  The effect on the date of adoption resulted in a decrease in other long term liabilities and a decrease in other assets of $1,147 related to uncertain tax benefits for Canada, Germany, and Italy.

In November of 2011, the Federal Revenue Department of the Ministry of Finance of (“FRD”) issued a tax assessment against the Company’s indirect subsidiary, Xerium Technologies Brasil Indústria e Comércio S.A. (“Xerium Brazil”), challenging the goodwill recorded in the 2005 acquisition of Wangner Itelpa and Huyck Indústria e Comércio S.A. by Robec Brasil Participações Ltda., a predecessor to Xerium Brazil. This assessment denied the amortization of that goodwill against net income for the years 2006 through 2010 and sought payment of approximately $41,086 (subject to currency exchange rates) in

12

tax, penalties and interest as of March 31, 2014. The Company believes the transactions in question (i) complied with Brazilian tax and accounting rules, (ii) were effected for a legitimate business purpose, to consolidate the Company’s operating activities in Brazil into one legal entity, and (iii) were properly documented and declared to Brazilian tax and corporate authorities. Based on the foregoing, Xerium Brazil filed a response disputing the tax assessment. In December of 2012 an administrative panel at the first administrative appeals level within the FRD rendered a decision upholding the original assessment, but reducing the claimed penalties by 50%. This decision reduced the total assessed amount as of March 31, 2014 by approximately $11,102 to $29,984 (subject to currency exchange rates). On January 18, 2013, Xerium Brazil appealed the decision of the first administrative panel to the second of three administrative appeals courts potentially available to it within the FRD.

Although there can be no assurances, as of March 31, 2014, the Company believes it is more likely than not that it would prevail on every tax position under examination and therefore it did not accrue any amounts related to this assessment. The Company cannot assure a favorable outcome and cannot currently estimate the timing of the final resolution of this matter. The Company believes it has meritorious defenses and will vigorously contest this matter, and if the administrative courts of the FRD do not rule in the Company's favor, the Company intends to appeal its case to the Brazilian judicial courts. However, if management's views of the Company's position and the probable outcome of the assessment changes or the FRD’s initial position is sustained by Brazilian judicial courts, the amount accrued would adversely impact the Company’s financial condition and results of operations in the period in which any such determination or decision is made.

5. Pensions, Other Post-retirement and Post-employment Benefits

The Company accounts for its pensions, other post-retirement and post-employment benefit plans in accordance with ASC Topic 715, Compensation—Retirement Benefits (“Topic 715”). The Company has defined benefit pension plans covering substantially all of its U.S. and Canadian employees and employees of certain subsidiaries in other countries. Benefits are generally based on the employee’s years of service and compensation. These plans are funded in conformity with the funding requirements of applicable government regulations. The Company does not fund certain plans, as funding is not required. The Company plans to continue to fund its U.S. defined benefit plans to comply with the Pension Protection Act of 2006. In addition, the Company also intends to fund its U.K. and Canadian defined benefit plans in accordance with local regulations.

As required by Topic 715, the following tables summarize the components of net periodic benefit cost:

Defined Benefit Plans

	Three Months Ended March 31,
	2014			2013
Service cost	$	816		$	973
Interest cost	1,650			1,560
Expected return on plan assets	(1,564		)	(1,412		)
Amortization of prior service cost	—			3
Amortization of net loss	295			572
Net periodic benefit cost	$	1,197		$	1,696

6. Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss

Comprehensive (loss) income for the three months ended March 31, 2014 and 2013 is as follows (net of tax benefits of $32):

	Three Months Ended March 31,
	2014			2013
Net income	$	1,167		$	5,485
Foreign currency translation adjustments	(1,669		)	(4,392		)
Pension liability changes under Topic 715	(275		)	1,602
Change in value of derivative instruments	19			32
Comprehensive (loss) income	$	(758	)	$	2,727

13

The components of accumulated other comprehensive loss for the three months ended March 31, 2014 are as follows (net of tax benefits of $5.1 million):

	Foreign Currency Translation     Adjustment			Pension Liability Changes Under  Topic 715			Change in Value of Derivative Instruments			Accumulated    Other Comprehensive (Loss) Income
Balance at December 31, 2013	$	(136	)	$	(29,681	)	$	(235	)	$	(30,052	)
Other comprehensive loss before reclassifications	(1,669		)	—			—			(1,669		)
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	—			(275		)	—			(275		)
Amortization of interest expense	—			—			21			21
Net current period other comprehensive (loss) income	(1,669		)	(275		)	21			(1,923		)
Balance at March 31, 2014	$	(1,805	)	$	(29,956	)	$	(214	)	$	(31,975	)

For the three months ended March 31, 2014, the amortization of actuarial losses is included in cost of products sold and general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income.

7. Restructuring and Impairment Expense

During the three months ended March 31, 2014, the Company recorded restructuring expenses of approximately $4,651.These included charges relating to the closure of a roll cover facility in Germany, the reduction of headcount and the second phase of the closure of a clothing facility in Argentina. During the three months ended March 31, 2013, the Company recorded restructuring expenses of approximately $1,255. These charges were primarily related to headcount reductions, the closure of a roll covering facility in France and the closure of a machine clothing facility in Argentina.

The following table sets forth the significant components and activity under restructuring programs for the three months ended March 31, 2014 and 2013:

	Balance at December 31,  2013		Charges		Currency     Effects			Cash Payments			Balance at March 31, 2014
Severance and other benefits	$	6,466	$	4,411	$	(46	)	$	(2,240	)	$	8,591
Facility costs and other	1,468		240		(11		)	(312		)	1,385
Total	$	7,934	$	4,651	$	(57	)	$	(2,552	)	$	9,976

	Balance at December 31,  2012		Charges (1)		Currency     Effects			Cash Payments			Balance at March 31, 2013
Severance and other benefits	$	15,577	$	775	$	(451	)	$	(4,109	)	$	11,792
Facility costs and other	335		410		(10		)	(570		)	165
Total	$	15,912	$	1,185	$	(461	)	$	(4,679	)	$	11,957

(1) Amount excludes $70 impairment charges.

Restructuring and impairment expense by segment, which is not included in Segment Earnings in Note 8, is as follows:

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	Three Months Ended March 31,
	2014		2013
Clothing	$	2,254	$	409
Roll Covers	2,397		727
Corporate	—		119
Total	$	4,651	$	1,255

8. Business Segment Information

The Company is a global manufacturer and supplier of consumable products used primarily in the production of paper and is organized into two reportable segments: Clothing and Roll Covers. The Clothing segment represents the manufacture and sale of synthetic textile belts used to transport paper along the length of papermaking machines. The Roll Covers segment primarily represents the manufacture and refurbishment of covers used on the steel rolls of papermaking machines and the servicing of those rolls. The Company manages each of these operating segments separately.

Management evaluates segment performance based on earnings before interest, taxes, depreciation and amortization and before allocation of corporate charges. Such measure is then adjusted to exclude items that are of an unusual nature and are not used in measuring segment performance or are not segment specific (“Segment Earnings (Loss)”). The accounting policies of these segments are the same as those for the Company as a whole. Inter-segment net sales and inter-segment eliminations are not material for any of the periods presented.

Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2014 and 2013.

	Clothing		Roll Covers		Corporate			Total
Three Months Ended March 31, 2014:
Net Sales	$	88,971	$	44,413	$	—		$	133,384
Segment Earnings (Loss)	$	19,124	$	7,836	$	(1,258	)
Three Months Ended March 31, 2013:
Net Sales	$	89,937	$	49,868	$	—		$	139,805
Segment Earnings (Loss)	$	18,062	$	14,070	$	(2,989	)

Provided below is a reconciliation of Segment earnings (loss) to income before provision for income taxes for the three months ended March 31, 2014 and 2013, respectively.

	Quarter Ended March 31,
	2014			2013
Segment Earnings (Loss):
Clothing	$	19,124		$	18,062
Roll Covers	7,836			14,070
Corporate	(1,258		)	(2,989		)
Stock-based compensation	(509		)	(295		)
Idle facility asset impairment	—			(857		)
Interest expense, net	(8,657		)	(9,206		)
Depreciation and amortization	(8,649		)	(9,542		)
Restructuring expense	(4,651		)	(1,255		)
Plant startup costs	(176		)	—
Income before provision for income taxes	$	3,060		$	7,988

9. Commitments and Contingencies

15

The Company is involved in various legal matters which have arisen in the ordinary course of business as a result of various immaterial labor claims, taxing authority reviews and other routine legal matters. As of March 31, 2014, the Company accrued an immaterial amount in its financial statements for these matters for which the Company believed the possibility of loss was probable and was able to estimate the damages. The Company does not believe that the ultimate resolution of these matters will have a material adverse effect on its financial position, results of operations or cash flow. The Company believes that any additional liability in excess of amounts provided which may result from the resolution of legal matters will not have a material adverse effect on the financial condition, liquidity or cash flow of the Company. See Note 4 for a discussion of Xerium Brazil’s proceeding with the FRD.

10. Stock-Based Compensation and Stockholders’ Deficit

The Company records stock-based compensation expense in accordance with ASC Topic 718, Accounting for Stock Compensation and has used the straight-line attribution method to recognize expense for time-based restricted stock units ("RSUs") and deferred stock units ("DSUs"). The Company recorded stock-based compensation expense during the three months ended March 31, 2014 and March 31, 2013 as follows:

	Three Months Ended March 31,
	2014		2013
RSU, Options and DSU Awards (1)	$	509	$	295

(1) Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors.

Summary of Activity under the Long-Term Incentive Plans

On May 8, 2012, the Board approved the 2012 Executive Long-Term Incentive Plan (the “2012 Executive LTIP”) under the 2010 Equity Incentive Plan (the "2010 Plan"). Awards under the 2012 Executive LTIP are both time-based and performance-based. A specific target share award is set for each participant in the 2012 Executive LTIP. Awards will be paid in the form of RSUs or shares of common stock of the Company. Time-based awards, or 50% of the total target award, were granted in the form of 54,750 time-based RSUs under the Company’s 2010 Plan. At March 31, 2014, 13,416 time-based RSUs vested in accordance with the 2012 Executive LTIP and were converted to common stock, net of applicable tax withholdings. The remaining one-third of the time-based RSUs will vest on March 31, 2015, and convert into shares of common stock as they vest. Performance-based awards, which constitute 50% of the total award, will be determined based on the Company’s performance against a three-year cumulative Adjusted EBITDA metric, adjusted for currency fluctuations during the term of the 2012 – 2014 Executive LTIP. The performance-based awards will convert into shares of the Company’s common stock and be paid after the close of the three-year performance period. The amount of the payment will be based on a sliding scale ranging from 50% if the metric is achieved at 85% of the target up to 200% if the metric is achieved at or above 115% of the target.

On June 13, 2013, at the 2013 Annual Meeting of Stockholders of Xerium Technologies, Inc., the stockholders of the Company approved an amendment to the 2010 Plan, which increased the aggregate number of shares of the Company’s common stock that may be delivered under or in satisfaction of awards under such plan from 913,525 to 1,663,525, increased the number of shares that may be subject to option and stock appreciation right grants and that may be granted as stock awards to any one participant in a calendar year from 150,000 to 500,000, and set a maximum cash award that may be granted to any one participant in a calendar year at $2,000. This amendment was approved by the Company’s Board of Directors on March 12, 2013.

On June 13, 2013, after the stockholders had approved the amendment to the 2010 Plan, the Board approved the granting of awards under the 2013 Executive Long-Term Incentive Plan (the "2013 Executive LTIP") under the 2010 Plan. Awards under the 2013 Executive LTIP are both time-based and performance-based and will be paid in the form of RSUs or shares of common stock of the Company. Time-based awards, or 50% of the total target award, were granted in the form of 179,571 time-based RSUs under the Company’s 2010 Plan. These time-based awards will cliff vest on March 11, 2016, and will be converted to common stock, net of applicable tax withholdings. Performance-based awards, which constitute the remaining 50% of the total award, will vest depending on the Company’s stock price performance during the three year participant service period from March 11, 2013 through March 10, 2016. If the awards vest, they will convert into shares of the Company’s common stock and be paid after the close of the three-year performance period.

16

Other Stock Compensation Plans

On August 15, 2012, in connection with the previously announced anticipated retirement of Stephen R. Light, the Board of Directors of the Company appointed Harold C. Bevis to the position of President and Chief Executive Officer, effective immediately, and Mr. Light notified the Company of his resignation, effective as of that date, as the Company's Chairman, President and Chief Executive Officer. The Company granted Mr. Bevis a sign-on award of 204,208 restricted stock units and options to acquire 781,701 shares of the Company's Common Stock, par value $0.001 per share. Both the restricted stock units and the options will vest over a three year period, beginning on the second anniversary of the August 15, 2012 grant date. The options have a 10-year term and an exercise price of $4.00 per share, the August 15, 2012 closing price of the Company's common stock on the New York Stock Exchange. In addition, on August 15, 2012, the Company accelerated the vesting of Mr. Light's remaining 50,000 restricted stock units, issuing 27,900 shares of common stock, upon vesting, net of certain tax withholdings.

Directors’ Deferred Stock Unit Plan

Under the 2011 non-management directors stock plan ("2011 DSU Plan”), each director receives an annual retainer of $112, to be paid on a quarterly basis in arrears. Half of the annual retainer is payable in DSUs, with the remaining half payable in DSUs, cash or a mix of both at the election of each director. The non-management directors were awarded an aggregate of 5,668 DSUs under the 2011 DSU Plan for service during the quarter ended March 31, 2014. In addition, in accordance with the 2011 DSU Plan, 4,796 DSUs were settled in Common Stock during the quarter ended March 31, 2014.

11. Supplemental Guarantor Financial Information

On May 26, 2011, the Company closed on the sale of its Notes. The Notes are unsecured obligations of the Company and are fully and unconditionally guaranteed on a senior unsecured basis by all of the domestic wholly owned subsidiaries of the Company (the “Guarantors”). In accordance with Rule 3-10 of Regulation S-X promulgated under the Securities Act of 1933, as amended, the following condensed consolidating financial statements present the financial position, results of operations and cash flows of Xerium Technologies, Inc. (referred to as “Parent” for the purpose of this note only) on a stand-alone parent-only basis, the Guarantors on a Guarantors-only basis, the combined non-Guarantor subsidiaries and elimination entries necessary to arrive at the information for the Parent, the Guarantors and non-Guarantor subsidiaries on a consolidated basis.

17

Xerium Technologies, Inc.

Consolidating Balance Sheet—(Unaudited)

At March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	685		$	(11	)	$	17,339	$	—		$	18,013
Accounts receivable, net	60			23,786			70,774		—			94,620
Intercompany receivables	(111,677		)	108,965			2,712		—			—
Inventories, net	—			18,464			70,727		(896		)	88,295
Prepaid expenses	198			1,287			5,088		—			6,573
Other current assets	—			4,352			10,050		—			14,402
Total current assets	(110,734		)	156,843			176,690		(896		)	221,903
Property and equipment, net	25,018			59,706			232,129		—			316,853
Investments	712,436			288,753			—		(1,001,189		)	—
Goodwill	—			17,737			50,199		—			67,936
Intangible assets	11,141			2,710			414		—			14,265
Other assets	5			—			10,101		—			10,106
Total assets	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	1,436		$	10,077		$	26,360	$	—		$	37,873
Accrued expenses	13,233			8,464			47,441		—			69,138
Current notes payable	—			—			8,243					8,243
Current maturities of long-term debt	2,062			—			142		—			2,204
Total current liabilities	16,731			18,541			82,186		—			117,458
Long-term debt, net of current maturities	433,163			608			—		—			433,771
Capitalized lease obligations	4,324			—			—		—			4,324
Deferred taxes	609			3,040			12,140		—			15,789
Pension, other post-retirement and post-employment obligations	11,011			1,063			54,653		—			66,727
Other long-term liabilities	126			—			4,621		—			4,747
Intercompany loans	242,251			(359,058		)	116,807		—			—
Total stockholders’ (deficit) equity	(70,349		)	861,555			199,126		(1,002,085		)	(11,753		)
Total liabilities and stockholders’ equity	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063

18

Xerium Technologies, Inc.

Consolidating Balance Sheet

At December 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	4,120		$	(10	)	$	21,606	$	—		$	25,716
Accounts receivable, net	—			22,188			65,764		—			87,952
Intercompany receivables	(112,848		)	110,434			2,414		—			—
Inventories, net	—			18,077			66,632		(779		)	83,930
Prepaid expenses	398			936			6,845		—			8,179
Other current assets	514			3,729			11,452		—			15,695
Total current assets	(107,816		)	155,354			174,713		(779		)	221,472
Property and equipment, net	15,794			59,250			234,620		—			309,664
Investments	700,697			284,444			—		(985,141		)	—
Goodwill	—			17,737			51,238		—			68,975
Intangible assets	10,964			3,094			412		—			14,470
Other assets	4			—			9,479		—			9,483
Total assets	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	2,109		$	10,380		$	29,731	$	—		$	42,220
Accrued expenses	9,794			8,172			43,402		—			61,368
Current notes payable	—			—			8,267		—			8,267
Current maturities of long-term debt	2,024			—			142		—			2,166
Total current liabilities	13,927			18,552			81,542		—			114,021
Long-term debt, net of current maturities	432,706			—			—		—			432,706
Deferred taxes	327			3,040			12,983		—			16,350
Pension, other post-retirement and post-employment obligations	11,212			1,182			54,472		—			66,866
Other long-term liabilities	106			5			5,459		—			5,570
Intercompany loans	233,755			(355,003		)	121,248		—			—
Total stockholders’ (deficit) equity	(72,390		)	852,103			194,758		(985,920		)	(11,449		)
Total liabilities and stockholders’ equity	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064

19

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive Income (Loss) (Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	43,156		$	99,265		$	(9,037	)	$	133,384
Costs and expenses:
Cost of products sold	(419		)	29,999			60,731			(9,093		)	81,218
Selling	113			5,068			12,997			—			18,178
General and administrative	1,884			2,520			10,393			—			14,797
Research and development	276			1,118			552			—			1,946
Restructuring and impairment	(18		)	237			4,432			—			4,651
	1,836			38,942			89,105			(9,093		)	120,790
(Loss) income from operations	(1,836		)	4,214			10,160			56			12,594
Interest expense, net	(8,242		)	1,395			(1,810		)	—			(8,657		)
Foreign exchange loss	(12		)	(81		)	(784		)	—			(877		)
Equity (deficit) in subsidiaries income	11,731			5,892			—			(17,623		)	—
Income before provision for income taxes	1,641			11,420			7,566			(17,567		)	3,060
Provision for income taxes	(474		)	(34		)	(1,385		)	—			(1,893		)
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Comprehensive income (loss)	$	1,578		$	11,116		$	4,115		$	(17,567	)	$	(758	)

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive (Loss) Income-(Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	46,115		$	105,399		$	(11,709	)	$	139,805
Costs and expenses:
Cost of products sold	(450		)	30,863			66,594			(11,709		)	85,298
Selling	—			5,871			13,350			—			19,221
General and administrative	1,982			807			11,845			—			14,634
Research and development	—			1,359			595			—			1,954
Restructuring and impairment	119			238			898			—			1,255
	1,651			39,138			93,282			(11,709		)	122,362
(Loss) income from operations	(1,651		)	6,977			12,117			—			17,443
Interest (expense) income, net	(6,704		)	1,406			(3,908		)	—			(9,206		)
Foreign exchange gain (loss)	183			(13		)	(419		)	—			(249		)
Equity in subsidiaries income (deficit)	13,704			4,754			—			(18,458		)	—
Dividend income	—			1,555			—			(1,555		)	—
Income before provision for income taxes	5,532			14,679			7,790			(20,013		)	7,988
Provision for income taxes	(47		)	106			(2,562		)	—			(2,503		)
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Comprehensive income	$	5,254		$	14,562		$	2,924		$	(20,013	)	$	2,727

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Xerium Technologies, Inc.

Consolidating Statement of Cash Flows-(Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The  Company
Operating activities
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	456			—			53			—			509
Depreciation	108			1,850			6,275			—			8,233
Amortization of intangibles	—			384			32			—			416
Deferred financing cost amortization	716			—			—			—			716
Foreign exchange loss on revaluation of debt	(1,103		)	—			—			—			(1,103		)
Deferred tax expense	282			—			(1,090		)	—			(808		)
Loss on disposition of property and equipment	—			22			5			—			27
Provision for doubtful accounts	—			165			80			—			245
Undistributed equity in earnings of subsidiaries	(11,731		)	(5,892		)	—			17,623			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(61		)	(1,762		)	(5,229		)	—			(7,052		)
Inventories	—			(387		)	(3,605		)	(56		)	(4,048		)
Prepaid expenses	201			(351		)	1,750			—			1,600
Other current assets	515			(623		)	927			—			819
Accounts payable and accrued expenses	2,767			(11		)	1,446			—			4,202
Deferred and other long-term liabilities	(182		)	(828		)	(1,150		)	—			(2,160		)
Intercompany loans	(1,171		)	1,401			(230		)	—			—
Net cash (used in) provided by operating activities	(8,036		)	5,354			5,445			—			2,763
Investing activities
Capital expenditures, gross	(5,537		)	(922		)	(4,035		)	—			(10,494		)
Intercompany property and equipment transfers, net	—			—			—			—			—
Proceeds from disposals of property and equipment	—			35			8			—			43
Net cash used in investing activities	(5,537		)	(887		)	(4,027		)	—			(10,451		)
Financing activities													—
Proceeds from borrowings	7,580												7,580
Principal payments on debt	(6,600		)	—			—			—			(6,600		)
Payment of obligations under capital leases	(126		)	(64		)							(190		)
Payment of financing fees	(710		)										(710		)
Intercompany loans	9,994			(4,404		)	(5,590		)	—			—
Net cash provided by (used in) financing activities	10,138			(4,468		)	(5,590		)	—			80
Effect of exchange rate changes on cash flows	—			—			(95		)	—			(95		)
Net decrease in cash	(3,435		)	(1		)	(4,267		)	—			(7,703		)
Cash and cash equivalents at beginning of period	4,120			(10		)	21,606			—			25,716
Cash and cash equivalents at end of period	$	685		$	(11	)	$	17,339		$	—		$	18,013

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Xerium Technologies, Inc.

Consolidating Statement of Cash Flows (Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The Company
Operating activities
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	295			—			—			—			295
Depreciation	33			1,903			7,030			—			8,966
Amortization of intangibles	—			553			23			—			576
Deferred financing cost amortization	516			—			193			—			709
Foreign exchange loss on revaluation of debt	—			—			(118		)	—			(118		)
Deferred tax expense	—			—			282			—			282
Asset impairment	208			—			720						928
Loss (gain) on disposition of property and equipment	1			3			(14		)	—			(10		)
Intercompany dividend	—			—									—
Provision for doubtful accounts	—			(53		)	88			—			35
Undistributed equity in (earnings) loss of subsidiaries	(13,704		)	(4,754		)	—			18,458			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	—			(3,595		)	(5,632		)	—			(9,227		)
Inventories	—			529			399			—			928
Prepaid expenses	3			(639		)	1,088			—			452
Other current assets	(2,182		)	(35		)	254			—			(1,963		)
Accounts payable and accrued expenses	5,158			(234		)	(3,533		)	1,555			2,946
Deferred and other long-term liabilities	42			68			(111		)	—			(1		)
Intercompany loans	854			(1,496		)	642			—			—
Net cash (used in) provided by operating activities	(3,291		)	7,035			6,539			—			10,283
Investing activities
Capital expenditures, gross	(1,466		)	(632		)	(1,615		)	—			(3,713		)
Proceeds from disposals of property and equipment	—			—			317			—			317
Net cash used in investing activities	(1,466		)	(632		)	(1,298		)	—			(3,396		)
Financing activities
Principal payments on debt	(313		)	—			(290		)	—			(603		)
Intercompany loans	7,499			(6,449		)	(1,050		)	—			—
Net cash provided by (used in) financing activities	7,186			(6,449		)	(1,340		)	—			(603		)
Effect of exchange rate changes on cash flows	—			(1		)	(297		)	—			(298		)
Net increase (decrease) in cash	2,429			(47		)	3,604			—			5,986
Cash and cash equivalents at beginning of period	6,471			36			28,270			—			34,777
Cash and cash equivalents at end of period	$	8,900		$	(11	)	$	31,874		$	—		$	40,763

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to the safe harbor created by that Act. These statements relate to future events or to our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. In some cases, forward-looking statements can be identified by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other comparable terminology. Undue reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors that are, in some cases, beyond our control and that could materially affect actual results, levels of activity, performance, or achievements. Factors that could materially affect our actual results, levels of activity, performance or achievements include the following items:

• our strategy to lower our costs in response to market changes in the paper industry by reorganizing and restructuring our operations will require us to incur significantly higher costs in the short-term and may not provide the cost reductions and results we anticipate;

• we are subject to execution risk related to the startup of our proposed new facility in China;

• we are subject to the risk of a weaker global economy that influences the paper industry as well as local economic conditions in the areas around the world where we conduct business;

• structural shifts in the demand for paper, for instance the shift away from newsprint, printing and writing paper in favor of digital media, may adversely impact customers' demand for our products and services and consequently our financial results;

• our strategies and plans, including, but not limited to, those relating to developing and successfully marketing new products, enhancing our operational efficiencies and reducing costs, may not result in the anticipated benefits;

• our financial results could be adversely affected by fluctuations in interest rates and currency exchange rates;

• our manufacturing facilities may be required to quickly increase or decrease production capacity, which could negatively affect our production, customer order lead time, product quality, labor relations or gross margin;

• we may not be successful in developing and marketing new technologies or in competing against new technologies developed by competitors;

• variations in demand for our products, including our new products, could negatively affect our net sales and profitability;

• we are subject to fluctuations in the price of our component supply costs;

• due to our high degree of leverage and significant debt service obligations, we need to generate substantial operating cash flow to fund growth and unexpected cash needs;

• we are subject to the risk of terrorist attacks or an outbreak or escalation of any insurrection or armed conflict involving the United States or any other country in which we conduct business, or any other domestic or international calamity, including natural disasters;

• we are subject to the impact of changes in the policies, laws, regulations and practices of the United States and any foreign country in which we operate or conduct business, including changes regarding taxes and the repatriation of earnings; and

• anti-takeover provisions could make it more difficult for a third-party to acquire us.

Other factors that could materially affect our actual results, levels of activity, performance or achievements can be found in our “Risk Factors” section in our Annual Report on Form 10-K for the year ended December 31, 2013, filed with the SEC on March 4, 2014. If any of these risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary significantly from what we project. Any forward-looking statement in this Quarterly Report on Form 10-Q reflects our current views with respect to future events and is subject to these and other risks, uncertainties, and assumptions relating to our operations, results of operations, growth strategy, and liquidity. We assume no obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise, except as required by law.

All references in this Quarterly Report to “Xerium”, “the Company”, “we”, “our” and “us” means Xerium Technologies, Inc. and its subsidiaries.

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Company Overview

We are a leading global manufacturer and supplier of two types of consumable products used primarily in the production of paper—clothing and roll covers. Our operations are strategically located in the major paper-producing regions of North America, Europe, South America and Asia-Pacific. Our products play key roles in the formation and processing of paper along the length of a paper-making machine. Paper producers rely on our products and services to help improve the quality of their paper, differentiate their paper products, operate their paper-making machines more efficiently and reduce production costs.

We operate in two principal business segments: clothing and roll covers. In our clothing segment, we manufacture and sell highly engineered synthetic textile belts that transport paper as it is processed in a paper-making machine. Clothing plays a significant role in the forming, pressing and drying stages of paper production. Because paper-making processes and machine specifications vary widely, the clothing size, form, material and function is custom engineered to fit each individual paper-making machine and process. For the three months ended March 31, 2014, our clothing segment represented 67% of our net sales.

Our roll cover products provide a surface with the mechanical properties necessary to process the paper sheet in a cost-effective manner that delivers the sheet qualities desired by the paper producer. Roll covers are tailored to individual paper-making machines and processes, using different materials, treatments and finishings. In addition to manufacturing and selling new roll covers, we also provide refurbishment services for previously installed roll covers and we manufacture new and rebuilt spreader rolls. We also provide various related products and services to our customers, both directly and through third party providers, as a growing part of our overall product offering through our roll covers sales channels. For the three months ended March 31, 2014, our roll cover segment represented 33% of our net sales.

Industry Trends and Outlook

Historically, demand for our products has been driven primarily by the volume (tonnage) of paper produced on a worldwide basis, which in turn is affected by global economic conditions. Since 2000, paper producers have taken actions that seek to structurally improve the balance between the supply of, and demand for, paper in response to the industry's highly cyclical swings in profitability driven by the oversupply of paper during periods when paper producers have more aggregate capacity than the market requires. As part of these efforts, they have permanently shut down many paper-making machines or entire manufacturing facilities.

Beginning about the same time the paper industry began to address the structural balance between the supply and demand for paper, the widespread adoption of e-commerce and digitalization of traditionally printed material has resulted in a prolonged decline in newsprint and printing and writing grades of paper. This longer term decline has been partially offset by increases in the production of packaging grades, both as a consequence of globalization of manufacturing and as a result of the increase of tissue/personal care products which have increased as global GDP has risen, particularly in the developing world. In 2010 and 2011, global paper and board production began to recover from the economic recession and show growth, particularly in developing countries. As international shipments of manufactured goods increased, containerboard production recovered particularly strongly, contributing over 50% of the total global improvement. The paper and board production recovery, however, stalled in the second half of 2011 and remained weak throughout 2012 and 2013. In 2014, we still expect that global paper and board manufacturers' operating rates will remain near their 2013 levels, while industry forecasters predict the growth of global paper production from 2014 to 2015 to be between approximately 2% and 3% per annum. Generally, and over time, we expect growth in paper production to be greater in Asia-Pacific, South America and Eastern Europe than in the more mature North American and Western European regions, where demand may decline.

Despite projected growth, many paper producers continue to experience low levels of profitability. Any anticipated global paper production growth would be moderated by further consolidation among papermakers, reduction in the number of paper producers, and shutdowns of paper-making machines or facilities, which we believe will continue, particularly in Europe and North America, until there is a better balance between supply and demand for paper and the profit levels of paper producers improve.

Also affecting machine curtailments are structural productivity gains from new paper machine designs that have fewer rolls and from improved products that we and our competitors supply, which enable paper producers to manufacture more paper with fewer machines. In particular, market recognition of the extended life of our roll cover products has, and will likely continue to, negatively impact demand for these products and their volume potential. Additionally, we are seeing a trend that paper producers are placing an increasing emphasis on maintenance cost reduction and, as a result, are extending the life of roll covers through additional maintenance cycles before replacing them. However, we believe volume declines would be at least partially offset by our introduction of new products with the extended life qualities that our customer's desire and increasing market share of proprietary products such as our SmartRoll™.

24

In response to this, we expect to continue to focus our research and development efforts on new products that deliver increased value to our customers and for which they will pay increased prices. In addition, we intend to continue to enhance and deploy our value added selling approach as part of our strategy to differentiate our products, while at the same time we remain focused on cost reduction and efficiency programs.

The negative paper industry trends described above are likely to continue. We believe that the paper industry will continue to experience an increased emphasis on cost reduction and continued paper-machine shutdown activity. These underlying industry dynamics could negatively impact our business, results of operations and financial condition and are the key drivers behind our strategy to reduce our cost structure, align our geographic footprint with anticipated growth in the South America and Asia-Pacific regions and grow our non-paper business revenue streams.

Net Sales and Expenses

Net sales in both our clothing and roll covers segments are primarily driven by the following factors:

•The volume (tonnage) of worldwide paper production;

•Our ability to introduce new products that our customers value and will pay for;

• Advances in technology of our products, which can provide value to our customers by improving the efficiency of paper-making machines and reduce their manufacturing costs;

•Growth in developing markets, particular in Asia;

•The mix of paper grades being produced;

•Our ability to enter and expand our business in non-paper products; and

•The impact of currency fluctuations.

Net sales in our roll covers segment include our mechanical services business. We have expanded this business in response to demand from paper producers that we perform work on the internal mechanisms of their rolls while we refurbish or replace a roll cover. In our clothing segment, a small portion of our business has been conducted pursuant to consignment arrangements; for these, we do not recognize a sale of a product to a customer until the customer places the product into use, which typically occurs some period after the product is shipped to the customer or to a warehouse location near the customer’s facility. As part of the consignment agreement, we deliver the goods to a location designated by the customer. In addition, we agree to a “sunset” date with the customer, which represents the date by which the customer must accept all risks and responsibilities of ownership of the product and payment terms begin. For consignment sales, revenue is recognized on the earlier of the actual product installation date or the “sunset” date.

Our operating cost levels are impacted by total sales volume, raw material costs, the impact of inflation, foreign currency fluctuations and the success of our cost reduction programs.

The level of our cost of products sold is primarily attributable to labor costs, raw material costs, product shipping costs, plant utilization and depreciation, with labor costs constituting the largest component. We invest in facilities and equipment that enable innovative product development and improve production efficiency and costs. Recent examples of capital spending for such purposes include faster weaving looms and seaming machines with accurate electronic controls, automated compound mixing equipment and computer-controlled lathes and mills.

The level of research and development spending is driven by market demand for technology enhancements, including both specific customer needs and general market requirements, as well as by our own analysis of applied technology opportunities. With the exception of purchases of equipment and similar capital items used in our research and development activities, all research and development is expensed as incurred. Research and development expenses were $1.9 million and $2.0 million for the three months ended March 31, 2014 and 2013, respectively.

Foreign Exchange

We have a geographically diverse customer base. In the three months ended March 31, 2014 we generated approximately 36% of our net sales in North America, 36% in Europe, 19% in Asia-Pacific and 9% in South America.

A substantial portion of our net sales is denominated in Euros or other currencies. As a result, changes in the relative values of U.S. Dollars, Euros and other currencies affect our reported levels of net sales and profitability as the results are translated into U.S. Dollars for reporting purposes. In particular, decreases in the value of the U.S. Dollar relative to the

25

value of the Euro and these other currencies positively impact our levels of revenue and profitability because the translation of a certain number of Euros or units of such other currencies into U.S. Dollars for financial reporting purposes will represent more U.S. Dollars than it would have prior to the relative decrease in the value of the U.S. Dollar. Conversely, a decline in the value of the Euro will result in a lower number of U.S. Dollars for financial reporting purposes.

For certain transactions, our net sales are denominated in U.S. Dollars but all or a substantial portion of the associated costs are denominated in a different currency. As a result, changes in the relative values of U.S. Dollars, Euros and other currencies can affect the level of the profitability of these transactions. The largest proportion of such transactions consists of transactions in which the net sales are denominated in or indexed to the U.S. Dollar and all or a substantial portion of the associated costs are denominated in Brazilian Reals or other currencies.

During the three months ended March 31, 2014, we conducted business in nine foreign currencies. The following table provides the average exchange rate for the three months ended March 31, 2014 and the three months ended March 31, 2013 of the U.S. Dollar against each of the four foreign currencies in which we conduct the largest portion of our operations.

Currency	Three Months Ended March 31, 2014:	Three Months Ended March 31, 2013:
Euro	$1.37 = 1 Euro	$1.32 = 1 Euro
Brazilian Real	$0.42 = 1 Brazilian Real	$0.50 = 1 Brazilian Real
Canadian Dollar	$0.91 = 1 Canadian Dollar	$.99 = 1 Canadian Dollar
Australian Dollar	$0.90 = 1 Australian Dollar	$1.04 = 1 Australian Dollar

In the three months ended March 31, 2014, we conducted approximately 36% of our operations in Euros, approximately 11% in the Australian Dollar, approximately 8% in the Brazilian Real (although a significant portion of Brazil net sales are in U.S. Dollars) and approximately 5% in the Canadian Dollar.

To mitigate the risk of transactions in which a sale is made in one currency and associated costs are denominated in a different currency, we may utilize forward currency contracts in certain circumstances to lock in exchange rates with the objective that the gain or loss on the forward contracts will approximate the loss or gain that results from the transaction or transactions being hedged. We determine whether to enter into hedging arrangements based upon the size of the underlying transaction or transactions, an assessment of the risk of adverse movements in the applicable currencies and the availability of a cost effective hedge strategy. To the extent we do not engage in hedging or such hedging is not effective, changes in the relative value of currencies can affect our profitability.

Domestic and Foreign Operating Results:

The following is an analysis of our domestic and foreign operations during the three months ended March 31, 2014 and March 31, 2013 and a discussion of the results of operations during those periods (in thousands):

	Three Months Ended March 31,
	2014		2013
Domestic income from operations	$	2,378	$	5,326
Foreign income from operations	10,216		12,117
Total income from operations	$	12,594	$	17,443

During the three months ended March 31, 2014, domestic income from operations was lower than foreign income from operations primarily due to product mix, market differences and various unallocated corporate expenses. Excess cash generated from the operations of most foreign subsidiaries typically remained permanently reinvested. However, the earnings generated by foreign subsidiaries in 2013 and 2014 will be remitted to the parent company at some point in the future. U.S. income taxes and foreign withholding taxes have been provided related to those foreign earnings. Foreign un-remitted earnings generated in years prior to 2013 will remain indefinitely reinvested, except for Brazil and Mexico for which U.S. income taxes and foreign withholding taxes have been provided.

Cost Reduction Programs

26

An important part of our strategy is to seek to reduce our overall costs and improve our competitiveness. As a part of this effort, we engage in cost reduction programs, which are designed to improve the cost structure of our global operations in response to changing market conditions. These cost reduction programs include headcount reductions throughout the world as well as plant closures that are intended to rationalize production among our facilities to better enable us to match our cost structure with customer demand. Cost savings have been realized and are expected to be realized in labor costs and other production overhead, other components of costs of products sold, general and administrative expenses and facility costs. The majority of cost savings begin at the time of the headcount reductions and plant closure with remaining cost savings recognized over subsequent periods. Cost savings from headcount reductions have not been and are not expected to be offset by related increases in other expenses. Cost savings related to plant closures have been and are expected to be partially offset by additional costs incurred in the facilities that assumed the operations of the closed facility.

During the three months ended March 31, 2014, we recorded restructuring expenses of approximately $4.7 million. These included charges relating to the closure of a roll cover facility in Germany, the reduction of headcount and the second phase of the closure of a clothing facility in Argentina. During the three months ended March 31, 2013, we recorded restructuring expenses of approximately $1.3 million. These charges were primarily related to headcount reductions, the closure of a roll covering facility in France and the closure of a machine clothing facility in Argentina.

Results of Operations

The table that follows sets forth for the periods presented certain consolidated operating results.

	Three Months Ended March 31,
	2014			2013
	(in thousands)
Net sales	$	133,384		$	139,805
Costs and expenses:
Cost of products sold	81,218			85,298
Selling	18,178			19,221
General and administrative	14,797			14,634
Research and development	1,946			1,954
Restructuring	4,651			1,255
	120,790			122,362
Income from operations	12,594			17,443
Interest expense, net	(8,657		)	(9,206		)
Foreign exchange loss	(877		)	(249		)
Income before provision for income taxes	3,060			7,988
Provision for income taxes	(1,893		)	(2,503		)
Net income	$	1,167		$	5,485
Comprehensive (loss) income	$	(758	)	$	2,727

Three Months Ended March 31, 2014 Compared to the Three Months Ended March 31, 2013

Net Sales. Net sales for the three months ended March 31, 2014 decreased by $6.4 million, or 4.6%, to $133.4 million from $139.8 million for the three months ended March 31, 2013. For the three months ended March 31, 2014, approximately 67% of our net sales were in our clothing segment and approximately 33% were in our roll covers segment.

In our clothing segment, net sales for the three months ended March 31, 2014 decreased by $0.9 million, or 1.0%, to $89.0 million from $89.9 million for the three months ended March 31, 2013, primarily due to decreased sales volume of $0.8 million in Asia and $0.8 million in Europe, partially offset by a increase in sales volume of $0.4 million in North America and $0.3 million in South America.

In our roll covers segment, net sales for the three months ended March 31, 2014 decreased by $5.5 million or 11.0%, to $44.4 million from $49.9 million for the three months ended March 31, 2013. The decrease was primarily due to decreased sales volume of $2.9 million in North America, $2.2 million in Europe and $0.6 million in Asia. These were partially offset by by an increase of $0.2 million in South America.

27

Cost of Products Sold. Cost of products sold for the three months ended March 31, 2014 decreased by $4.1 million, or 4.9% to $81.2 million from $85.3 million for the three months ended March 31, 2013.

In our clothing segment, cost of products sold decreased $3.5 million in the current quarter compared to the first quarter of 2013 as a result of lower sales volume and cost of products sold as a percentage of sales. Cost of products sold, as a percentage of net sales decreased by 3.5% to 58.1% in the three months ended March 31, 2014 from 61.6% in the three months ended March 31, 2013. This decrease was primarily due to reduced costs as a result of restructuring savings and operational efficiencies, partially offset by unfavorable material variances due to inflation.

In our roll covers segment, cost of products sold decreased $0.5 million in the current quarter compared to the first quarter of 2013, due to reduced sales volume. However, cost of products sold, as a percentage of net sales increased by 6.1% to 66.1% for the three months ended March 31, 2014 from 60.0% for the three months ended March 31, 2013. This increase was primarily due to unfavorable sales mix as a result of higher sales of products and services with lower gross margins.

Selling Expenses. For the three months ended March 31, 2014, selling expenses decreased by $1.0 million, or 0.5% to $18.2 million from $19.2 million for the three months ended March 31, 2013. Favorable currency effects accounted for $0.6 million of this decrease, while restructuring savings accounted for the remaining $0.4 million.

General and Administrative Expenses. For the three months ended March 31, 2014, general and administrative expenses increased by $0.2 million, or 1.4% to $14.8 million from $14.6 million for the three months ended March 31, 2013, primarily as a result of a gain of $0.7 million realized in 2013 related to an insurance recovery from a plant fire and increased administrative costs of $0.3 million in 2014. These increases were partially offset by decreases related to the impairment of a vacant facility of $0.6 million in 2013 and CEO transition costs of $0.2 million in 2013 not incurred in 2014.

Restructuring Expenses. For the three months ended March 31, 2014, we incurred restructuring expenses of $4.7 million . These included charges relating to the closure of a roll cover facility in Germany, the reduction of headcount and the closure of a clothing facility in Argentina. In the first three months of 2013, we incurred restructuring expenses of $1.3 million. These charges were primarily related to headcount reductions, the closure of a roll covering facility in France and the second phase of the closure of a machine clothing facility in Argentina.

Interest Expense, Net. Net interest expense for the three months ended March 31, 2014 decreased by $0.5 million or 5.4%, to $8.7 million from $9.2 million for the three months ended March 31, 2013. The decrease was primarily due to capitalized interest of $0.3 million related to certain equipment construction projects in the first quarter of 2014 and lower average interest rates during the first quarter of 2014 versus the first quarter of 2013.

Provision for Income Taxes. For the three months ended March 31, 2014 and March 31, 2013, the provision for income taxes was $1.9 million and $2.5 million, respectively. The decrease in income tax expense was primarily attributable to decreased earnings and the geographic mix of earnings in the first quarter of 2014 as compared to the first quarter of 2013. Our provision for income taxes is primarily impacted by income we earn in tax paying jurisdictions relative to income we earn in non-tax paying jurisdictions. The majority of income recognized for purposes of computing our effective tax rate is earned in countries where the statutory income tax rates range from 15% to 39%. However, permanent income adjustments recorded against pre-tax earnings may result in an effective tax rate that is higher or lower than the statutory tax rate in these jurisdictions. We generate losses in certain jurisdictions for which we receive no tax benefit as the deferred tax assets in these jurisdictions (including net operating losses) are fully reserved in our valuation allowance. For this reason, we recognize minimal income tax expense or benefit in these jurisdictions, of which the most material jurisdictions are the United States, the United Kingdom and Australia. Due to these reserves, the geographic mix of our pre-tax earnings has a direct correlation with how high or low our annual effective tax rate is relative to consolidated earnings.

Liquidity and Capital Resources

Our principal liquidity requirements are for debt service, restructuring payments, working capital and capital expenditures. We plan to use cash on hand, cash generated by operations and, should it become necessary, access to our revolving credit facility, as our primary sources of liquidity. Our operations are highly dependent upon the paper production industry and the degree to which the paper industry is affected by global economic conditions and the availability of credit. Demand for our products could decline if paper manufacturers are unable to obtain required financing or if economic conditions cause additional mill closures. In addition, the impact of the most recent global economic recession and the continued lack of availability of credit may affect our customers’ ability to pay their debts.

Net cash provided by operating activities was $2.8 million for the three months ended March 31, 2014 and $10.3 million for the three months ended March 31, 2013. The $7.5 million decrease was due to decreased cash earnings.

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Net cash used in investing activities was $10.5 million for the three months ended March 31, 2014 and $3.4 million for the three months ended March 31, 2013. The increase in cash used of $7.1 million was primarily due to the increase in capital expenditures of $6.8 million.

Net cash provided by financing activities was $0.1 million for the three months ended March 31, 2014. Net cash used in financing activities was $0.6 million for the three months ended March 31, 2013, respectively. The increase of $0.7 million was primarily the result of the increase of $7.6 in proceeds from borrowings, partially offset by an increase of $6.0 million in principal payments made on debt in 2013 and an increase in the payment of financing fees and the payment of obligations under capital leases of $0.9 million.

As of March 31, 2014, the outstanding balance of our term debt under the Term Credit Facility and Notes (each defined below) was $434.0 million, which is net of a $0.9 million discount. In addition, as of March 31 2014, an aggregate of $37.5 million is available for additional borrowings under the ABL Facility (defined below). This availability represents a borrowing base of $49.9 million under the ABL Facility less $12.4 million of that facility committed for letters of credit or additional borrowings. Additionally, at March 31, 2014, we had approximately $5.1 million available for borrowings under other small lines of credit.

We expect to incur expense of approximately $10.0 million to $12.0 million related to the continuation of our restructuring initiatives for the remainder of 2014. We have incurred $4.7 million in the three months ended March 31, 2014. Actual restructuring costs for 2014 may substantially differ from estimates at this time, depending on the timing of the restructuring activities and the required actions to complete them.

Capital Expenditures

For the three months ended March 31, 2014 and 2013, we had capital expenditures of $10.5 million and $3.7 million. We are currently targeting capital expenditures for 2014 to approximate $48.0 million. We analyze our planned capital expenditures based on investment opportunities available to us and our financial and operating performance, and accordingly, actual capital expenditures may be more or less than this amount. We intend to use existing cash and cash from operations to fund our capital expenditures.

See “Credit Facility and Notes” below for a description on limitations on capital expenditures imposed by our Credit Facility.

Credit Facility and Notes

On May 17, 2013 (the "Closing Date"), we entered into a Credit and Guaranty Agreement for a $200 million term loan credit facility (the "Term Credit Facility”) among us, certain of our direct and indirect U.S. subsidiaries as guarantors and certain financial institutions. We also entered into a Revolving Credit and Guaranty Agreement for, originally, a $40 million asset-based revolving credit facility subject to a borrowing base among us, Xerium Canada Inc., as Canadian borrower, certain of our direct and indirect U.S. subsidiaries as guarantors and certain financial institutions (the "Domestic Revolver"). On March 3, 2014, we entered into an amendment to the Revolving Credit and Guaranty Agreement (as amended, the “ABL Facility,” and collectively with the Term Credit Facility, the “Credit Facility”) to add our German subsidiaries as European Borrowers and to provide for an additional $15 million European asset-based revolving credit facility subject to a European borrowing base (the "European Revolver"), increasing the aggregate availability under the ABL Facility to $55 million.

The Term Credit Facility provides for:

• a six-year $200 million senior secured term loan facility, provided the facility would mature in March 2018 if any of our 8.875% senior unsecured notes in the aggregate principal amount of $240 million (the "Notes") remain outstanding at that time;

• an uncommitted accordion option (the “Incremental Facility”) allowing for increases for borrowings under the Term Credit Facility with the same terms, and borrowing of new tranches of term loans, up to an aggregate principal amount equal to (i) $75 million plus (ii) an additional amount (the “Facility Increase”) provided, if after giving effect to such Facility Increase (as well as any other additional term loans), on a pro forma basis, the Senior Secured Leverage Ratio (as defined in the Term Credit Facility) for the most recent four consecutive fiscal quarters does not exceed 2.25:1; and

• in connection with the amendment to the ABL Facility, the Term Credit Facility was amended to permit the ABL Facility to be further increased by an additional $10 million, to a total aggregate availability of not more than $65 million, provided that if the ABL Facility is increased beyond $55 million, certain baskets for additional indebtedness and liens otherwise available to us under the Term Loan Facility will be reduced dollar-for-dollar by any additional increase to the ABL Facility.

The Domestic Revolver provides for a $40 million senior secured revolving credit facility with a $20 million sub-limit on letters of credit. The European Revolver provides for a $15 million senior secured revolving credit facility with a $10 million sub-limit on letters of credit. Availability under both the Domestic Revolver and the European Revolver is subject to a borrowing base that is based on a specified percentage of eligible accounts receivable and inventory. The term of the ABL Facility is five years, provided that if any of the Notes remain outstanding in March 2018, the ABL Facility would mature at that time.

We used the borrowings under the Term Credit Facility to refinance all of our outstanding indebtedness under our previously existing senior secured term loan and revolving credit facility entered into in 2011 (the "2011 Credit Facility"). We intend to draw upon the ABL Facility from time-to-time for working capital and general corporate purposes.

The Term Credit Facility will require us to make amortization payments (payable in quarterly installments) equal to 1% of principal per annum with respect to the term loan with the remaining amount due at final maturity. Voluntary prepayments will be permitted, in whole or in part, subject to minimum prepayment requirements; provided that voluntary prepayments of loans bearing interest at the London Interbank Offered Rate (“LIBOR”) on a date other than the last day of the relevant interest period will be subject to the payment of customary breakage costs.

The interest rates under the Term Credit Facility will be calculated, at our option, at either the base rate or LIBOR, plus a margin of 4.00% and 5.00%, respectively. Each of the base rate and LIBOR shall be subject to a minimum of 2.25% and 1.25%, respectively. If our Senior Secured Leverage Ratio (as defined in the Term Credit Facility) is less than 2.00:1 at any quarterly determination date, then the margins over the base rate and LIBOR will be 3.50% and 4.50%, respectively.

Depending on whether advances are made in U.S. Dollars or Canadian Dollars, interest rates under the Domestic Revolver will be calculated, at our option, at either a U.S.-based or Canadian-based base rate ("Base Rate Loans") or LIBOR or the Canadian Dealer Offered Rate ("CDOR") (each, "Fixed Rate Loans"), respectively, plus a margin of 0.75% for Base Rate Loans and a margin of 1.75% for Fixed Rate Loans. If we draw advances on the Domestic Revolver that are equal to or greater than 33.3% but less 66.7% of the $40 million limit, then the margins on Base Rate Loans and Fixed Rate Loans increase to 1.00% and 2.00%, respectively. The margins rise to 1.25% and 2.25%, respectively, if advances under the Domestic Revolver are equal to or greater than 66.7% of the $40 million limit. Interest rates under the European Revolver will be calculated, at either LIBOR or Overnight LIBOR, plus a margin of 1.75%. If the European Borrowers draw advances on the European Revolver that are equal to or greater than 33.3% but less than 66.7% of the $15 million limit, then the margin increases to 2.00%. The margin rises to 2.25% if advances under the European Revolver are equal to or greater than 66.7% of the $15 million limit. In addition to paying interest on outstanding advances under the ABL Facility, we will be required to pay a commitment fee to the lenders in respect of the unutilized commitments at a rate equal to 0.50% per annum if advances under

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the ABL Facility are less than or equal to 50% of the commitments or a rate equal to 0.375% per annum if advances under the ABL are more than 50% of the commitments.

The obligations under the Credit Facility are guaranteed by all of our existing and future direct and indirect subsidiaries that are organized in the United States (subject to certain exceptions in the case of immaterial subsidiaries and joint ventures) and, (i) in the case of the Domestic Revolver, by Xerium Canada Inc. and any future Canadian subsidiaries, provided that non-U.S. guarantors will only be liable for obligations of Xerium Canada Inc. and any other Canadian borrowers and (ii) in the case of the European Revolver, by each other European Borrower, certain of our other European subsidiaries and any existing or future direct and indirect subsidiaries that become a party to the ABL Facility. The Term Credit Facility is secured by a first-priority perfected security interest in substantially all of our assets, Xerium Canada Inc. and such subsidiary guarantors (collectively, the “Loan Parties”), in each case, now owned or later acquired, except with respect to the Loan Parties' accounts receivables and inventory, which are secured by a second-priority interest. The ABL Facility is secured by a first-priority perfected security interest in the Loan Parties' accounts receivables and inventory, and a second-priority interest in substantially all of the Loan Parties' other assets. In each case, the security interests are subject to certain exceptions and legal and tax considerations and requirements, including that only 65% of the voting capital stock of the domestic Loan Parties' “first-tier” non-U.S. subsidiaries is required to be pledged in respect of our obligations and the U.S. guarantors under the Credit Facility.

The Credit Facility contains certain customary covenants that, subject to exceptions, restrict our ability to, among other things:

•declare dividends or redeem or repurchase equity interests;

•prepay, redeem or purchase debt;

•incur liens and engage in sale-leaseback transactions;

•make loans and investments;

•incur additional indebtedness;

•amend or otherwise alter debt and other material agreements;

•make capital expenditures in excess of $42 million per fiscal year, subject to adjustment;

•engage in mergers, acquisitions and asset sales;

•transact with affiliates; and

•engage in businesses that are not related to our existing business.

The Credit Facility eliminates the interest coverage and leverage coverage ratio maintenance tests that were contained in the 2011 Credit Facility. However, the ABL Facility contains a springing Fixed Charge Coverage Ratio (as defined in the ABL Facility), which must be not less than 1.00:1 during periods in which our Global Excess Availability (as defined in the ABL Facility and generally, equal to our borrowing base less outstanding borrowings under the ABL Facility and trade payables at least 60 days past due) falls below certain minimum thresholds.

The Credit Facility contains certain customary representations and warranties, affirmative covenants and events of default, including payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults and cross-acceleration to certain indebtedness, certain events of bankruptcy, certain triggering events under U.S. and, in the case of the ABL Facility, Canadian employee benefit plans, material judgments, actual or asserted failures of any guarantee or security document supporting the Credit Facility to be in full force and effect and a change of control. If an event of default occurs, the lenders under the Credit Facility would be entitled to take various enforcement actions, including acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor.

On May 26, 2011, we completed a refinancing transaction, which replaced certain of our then outstanding indebtedness with the Notes.The Notes contain customary covenants that, subject to certain exceptions, restrict our ability to enter into certain transactions and engage in certain activities.

We are in compliance with all covenants under the Notes and Credit Facility at March 31, 2014.

Critical Accounting Policies

The condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). The preparation of financial statements in conformity with GAAP requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses. Actual results could differ from those estimates.

Our significant policies are described in the notes to the condensed consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013. Judgments and estimates of uncertainties are required in applying our accounting policies in many areas. There have been no material changes to the critical accounting policies

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affecting the application of those accounting policies as noted in our Annual Report on Form 10-K for the year ended December 31, 2013.

Non-GAAP Financial Measures

We use EBITDA and Adjusted EBITDA (each as defined in the Term Credit Facility) as supplementary non-GAAP liquidity measures to assist us in evaluating our liquidity and financial performance, specifically our ability to service indebtedness and to fund ongoing capital expenditures. Neither EBITDA nor Adjusted EBITDA should be considered in isolation or as a substitute for income from operations or cash flows (as determined in accordance with GAAP).

EBITDA is defined as net income before interest expense, income tax provision and depreciation (including non-cash impairment charges) and amortization.

“Adjusted EBITDA” means, with respect to any period, the total of (A) the consolidated net income for such period, plus (B) without duplication, to the extent that any of the following were deducted in computing such consolidated net income for such period: (i) provision for taxes based on income or profits, including, without limitation, federal, state, provincial, franchise and similar taxes, including any penalties and interest relating to any tax examinations, (ii) consolidated interest expense, (iii) consolidated depreciation and amortization expense, (iv) reserves for inventory in connection with plant closures, (v) consolidated operational restructuring costs, subject to annual limitations provided for in the Credit Facility, (vi) non-cash charges resulting from the application of purchase accounting, including push-down accounting, (vii) non-cash expenses resulting from the granting of common stock, stock options, restricted stock or restricted stock unit awards under equity compensation programs solely with respect to common stock, and cash expenses for compensation mandatorily applied to purchase common stock, (viii) non-cash items relating to a change in or adoption of accounting policies, (ix) non-cash expenses relating to pension or benefit arrangements, (x) expenses incurred as a result of the repurchase, redemption or retention of common stock earned under equity compensation programs solely in order to make withholding tax payments, (xi) amortization or write-offs of deferred financing costs, (xii) any non-cash losses resulting from mark to market hedging obligations (to the extent the cash impact resulting from such loss has not been realized in such period) and (xiii) other non-cash losses or charges (excluding, however, any non-cash loss or charge which represents an accrual of, or a reserve for, a cash disbursement in a future period), minus (C) without duplication, to the extent any of the following were included in computing consolidated net income for such period, (i) non-cash gains with respect to the items described in clauses (vi), (vii), (ix), (xi), (xii) and (xiii) (other than, in the case of clause (xiii), any such gain to the extent that it represents a reversal of an accrual of, or reserve for, a cash disbursement in a future period) of clause (B) above and (ii) provisions for tax benefits based on income or profits. Notwithstanding the foregoing, Adjusted EBITDA, as defined in the credit facility and calculated below, may not be comparable to similarly titled measurements used by other companies.

Consolidated net income is defined as net income determined on a consolidated basis in accordance with GAAP; provided, however, that the following, without duplication, shall be excluded in determining consolidated net income: (i) any net after-tax extraordinary or non-recurring gains, losses or expenses (less all fees and expenses relating thereto), (ii) the cumulative effect of changes in accounting principles, (iii) any fees and expenses incurred during such period in connection with the issuance or repayment of indebtedness, any refinancing transaction or amendment or modification of any debt instrument, in each case, as permitted under the Credit Facility and (iv) any cancellation of indebtedness income.

The following table provides reconciliation from net income and operating cash flows, which are the most directly comparable GAAP financial measures, to EBITDA and Adjusted EBITDA.

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	Three Months Ended March 31,
	2014			2013
Net income	$	1,167		$	5,485
Stock-based compensation	509			295
Depreciation	8,233			8,966
Amortization of intangibles	416			576
Deferred financing cost amortization	716			709
Foreign exchange loss on revaluation of debt	(1,103		)	(118		)
Deferred tax expense	(808		)	282
Asset impairment	—			928
Gain (loss) on disposition of property and equipment	27			(10		)
Net change in operating assets and liabilities	(6,394		)	(6,830		)
Net cash provided by operating activities	2,763			10,283
Interest expense, excluding amortization	7,941			8,497
Net change in operating assets and liabilities	6,394			6,830
Current portion of income tax expense	2,700			2,221
Stock-based compensation	(509		)	(295		)
Foreign exchange loss on revaluation of debt	1,103			118
Asset impairment	—			(928		)
(Loss) gain on disposition of property and equipment	(27		)	10
EBITDA	20,365			26,736
Stock-based compensation	509			295
Operational restructuring expenses	4,651			1,255
Non-restructuring impairment expense	—			857
Plant startup costs	176			—
Adjusted EBITDA	$	25,701		$	29,143

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our foreign currency exposure and interest rate risks as of March 31, 2014 have not materially changed from December 31, 2013 (see Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2013). As of March 31, 2014, we had outstanding long-term debt with a carrying amount of $436.0 million with an approximate fair value of $455.0 million.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures. We have carried out an evaluation, as of March 31, 2014 under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a–15(e) and 15d–15(e) under the Securities Exchange Act of 1934, as amended (the “Act”). Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms; and (ii) accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosures. No evaluation of disclosure controls and procedures can provide absolute assurance that these controls and procedures will operate effectively under all circumstances. However, our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives, and our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures are effective at the reasonable assurance level as set forth above.

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(b) Changes in Internal Control over Financial Reporting. No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Act) occurred during the quarter ended March 31, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There have been no material developments to the legal proceedings described in our Annual Report on Form 10-K for the year ended December 31, 2013. See Notes 4 and 9 to our Unaudited Condensed Consolidated Financial Statements for a discussion of our Brazilian operating subsidiary’s proceedings before the Federal Reserve Department of Brazil and other routine litigation to which we are subject.

ITEM 1A. RISK FACTORS

The risks described in our Annual Report on Form 10-K for the year ended December 31, 2013 have not materially changed.

ITEM 6.    EXHIBITS

See the exhibit index following the signature page to this Quarterly Report on Form 10-Q.

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SIGNATURES

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 thereunto duly authorized.

	XERIUM TECHNOLOGIES, INC.
	(Registrant)
May 8, 2014	By:	/s/Clifford E. Pietrafitta
		Clifford E. Pietrafitta
		Executive Vice President and CFO
		(Principal Financial Officer)

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EXHIBIT INDEX

Exhibit   Number	Description of Exhibits
10.1	Form of 2014 Management Incentive Plan
10.2	Employment Agreements with Wern-Lirn "Paul" Wang
31.1	Certification Statement of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification Statement of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification Statement of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification Statement of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document

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EX-10.1

XERIUM TECHNOLOGIES, INC.

2014 MANAGEMENT INCENTIVE COMPENSATION PROGRAM

This Xerium Technologies, Inc. 2014 Management Incentive Compensation (“MIC”) Program contains rules supplemental to those set forth in the Xerium Technologies, Inc. 2010 Equity Incentive Plan (the “EIP”). The MIC provides for the grant of the incentive award opportunities (each, an “Award”) under and subject to the terms of the EIP, which is incorporated herein by reference. In the event of any inconsistency between the MIC and applicable provisions of the EIP, the EIP shall control. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the EIP.

1.Administration; Eligibility. The MIC shall be administered by the Committee as described in the EIP. The Committee may in its discretion consult with outside advisors or internal Company resources for purposes of making any determinations in connection with its administration of the MIC. Eligibility to participate in the MIC shall be limited to individuals who are selected by the Committee to participate in the MIC from among those individuals who are eligible to participate in the EIP. Each selected individual who signs and returns an agreement (“Award Agreement”) in substantially the form of Exhibit A shall be a participant (“Participant”) in the MIC Program. Participation in any Award shall not entitle a Participant to share in any future Awards or in any other future awards of the Company or its subsidiaries.

2.Features of Awards. Each Award shall entitle the holder, subject to satisfaction of the performance conditions under the Award, to a benefit determined in accordance with the provisions of the Award Agreement applicable to such Participant that shall be payable in cash in accordance with the Award Agreement. The performance year is the fiscal/calendar year 2014.

3.Award Determinations. The Award for each Participant shall be initially determined as set forth on Schedule 1 of the Award Agreement on the basis of the target Award and Xerium’s 2014 Bank-Adjusted EBITDA (as defined in Schedule 1 of the Award Agreement) (the “Formula Award”) and the amounts actually payable to all Participants in the aggregate shall not exceed 100% of the sum of the Formula Awards for all Participants in the aggregate, provided, however, (i) one hundred twenty percent (120%) of the sum of the Formula Awards payable to all Participants shall constitute a pool for the payment of MIC Awards and (ii) the amount payable to any Participant shall not be less than eighty percent (80%) of and shall not exceed one hundred twenty percent (120%) of his or her Formula Award so long as the total amounts payable to all Participants in the aggregate do not exceed the 100% of the sum of the Formula Awards for all Participants cap set forth above.

4.Termination of Employment. Unless otherwise determined by the Committee in its sole discretion, no Award shall be payable to or in respect of Participant unless the Participant is employed by the Company or a subsidiary on December 31 of the performance year; provided that in the event of a termination of Participant’s employment by the Company or a subsidiary without Cause or a Good Reason (as “Cause” and “Good Reason” are defined in the Award Agreement), a pro-rata portion of the Award determined as of the date of termination shall be paid upon payout to all other Participants pursuant to Section 5 below.

5.Payout. The amount determined under Schedule 1 with respect to an Award shall be paid to a Participant in cash, as soon as practicable after completion of the Company’s audit for calendar year ending December 31, 2014, but in all events before the 15^th day of the third month following December 31 following the performance year.

6.Tax Withholding. The minimum tax withholding amount with respect to any payments being made in cash shall be withheld from such payments.

7.Intent to be Exempt from Section 162(m). Awards for the 2013 performance year are intended to qualify for the performance-based compensation exception under Section 162(m) of the Code.

8.Nature of Awards. Awards hereunder are intended as cash awards pursuant to the EIP. The MIC Program is unfunded and any cash payments by the Company hereunder shall be made from the general assets of the Company.

9.Other Incentives. Nothing in this MIC Program restricts the ability of the Company to pay incentive compensation or other supplemental compensation in any amount to any individual for any reason, including but not limited to hiring incentives, retention incentives, separation payments, safety and service awards or incentive compensation or awards on any other basis.

10.No Duplication. There shall be no duplication of annual incentives under multiple plans. If the Committee in its sole discretion determines that a Participant also participates in another annual cash incentive arrangement of the Company or any Affiliate based on the achievement of financial or personal goals, the Committee may in its sole discretion reduce the amount of any Award under this Plan by the amount or value of the of the duplicative benefit.

11.Prior MIC Programs. The MIC Program as set forth in this document supercedes for 2014 fiscal year all prior management incentive compensation plans.

12.Amendment. The Committee may amend the MIC at any time and from time to time, and may terminate the MIC, in each case subject only to such limitations, if any, as the EIP may impose.

13.409A. This MIC and the Awards granted thereunder shall be construed and administered consistent with the intent that they at all times be in compliance with or exempt from the requirements of Section 409A of the Code and the regulations promulgated thereunder.

- 2 -

EXHIBIT A

XERIUM TECHNOLOGIES, INC.

MANAGEMENT INCENTIVE COMPENSATION AWARD AGREEMENT

Pursuant to the terms of the Xerium Technologies, Inc. 2014 Management Incentive Compensation Program (the “MIC”) and the Xerium Technologies, Inc. 2010 Equity Incentive Plan (the “Plan”), Xerium Technologies, Inc. (the “Company”) hereby grants to the Employee the Management Incentive Compensation Award (“MIC Award”) described below.

1.The Incentive Compensation Award. The MIC Award is subject to the terms and conditions of this Management Incentive Compensation Award Agreement (“Agreement”) and the Plan. The Incentive Compensation Award is a cash award payable as set forth in this Agreement. The target amount of the award for the Employee, as a percentage of Employee’s year-end annual base compensation from the Company, is set forth on Schedule 1 of this Agreement. The amount payable will be adjusted upward or downward, or may be forfeited, based on performance as set forth on Schedule 1 of this Agreement. “Vested” portion of the Award is the portion of the Award to which the Employee has a nonforfeitable rights. An Award shall be paid hereunder only to the extent that such Award is Vested, as provided in this Agreement. The Employee’s rights to payment under the Award are subject to the restrictions described in this Agreement and the Plan in addition to such other restrictions, if any, as may be imposed by law.

1.Payment of Award. The amount determined under Schedule 1 shall be paid to the Employee in cash not later than March 15, 2015, subject to applicable tax withholding.

2.Treatment of Awards Upon a Change of Control; Termination of Employment.

(a)In the event a Change of Control (defined below) occurs prior to the close of the performance year with respect to the Award, for the performance period from January 1, 2014 to the date of closing of the Change of Control (the “COC Performance Year”) the applicable performance metrics specified in Schedule 1 of the Award Agreement shall be determined as follows: (i) the performance year shall be deemed to end on the effective date of such transaction; and (ii) the performance metrics shall be deemed achieved to the extent the applicable performance metrics specified in Schedule 1 of the Award Agreement for the shortened performance year described in clause (i) above are on target to be achieved based upon the financial information available to the Company. In the event such performance metrics have been achieved pursuant to the foregoing sentence for the COC Performance Year and the MIC (or an equivalent plan approved by the Board that is no less lucrative or generous than the MIC) is not continued for the period from the end of the COC Performance Year to the end of calendar year 2014, the full amount of the Award determined under Schedule 1 shall be paid to the Employee in cash promptly following the Change of Control, subject to applicable tax withholding. In the event such performance metrics have been achieved pursuant to the first sentence above for the COC Performance Year and the MIC (or an equivalent plan approved by the Board that is no less lucrative or generous than the MIC) is continued for the period from the end of the COC Performance Year to the end of the calendar year (subject to an adjustment for any payments made at the Change of Control effective date hereunder), the amount of the Award determined under Schedule 1 shall be prorated by multiplying the Award by a fraction, the numerator of which is the number of days in the COC Performance Year and the denominator of which is 365, and such Award shall be paid to the Employee in cash promptly following the Change of Control, subject to applicable tax withholding. For avoidance of doubt and for example purposes only, assuming a COC Performance Year ending on July 31 where the Bank Adjusted EBITDA is on target to achieve 125% of target for the full year

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and the Employee’s target award is 50% of a $250,000 base compensation, in the event that at the closing of such Change of Control the Company does not provide for the continuation of the MIC or equivalent plan that is no less lucrative or generous than the MIC for the remainder of the year, Employee shall be entitled to receive the full amount of his Award totaling $156,250.

(b)In the event of a termination of the Employee’s employment for reasons other than (i) death or Disability, (ii) termination without Cause or (iii) termination by the Employee with Good Reason on or prior to December 31, 2014, no Award shall be payable to Employee.

(c)In the event of a termination of the Employee’s employment as a result of (i) death or Disability, (ii) termination without Cause or (iii) termination by the Employee with Good Reason on or prior to December 31, 2014, the Formula Award for such Employee determined under Schedule 1 of the Award Agreement shall be prorated by multiplying such Formula Award amount by a fraction, the numerator of which is the number of days in the performance year in which Employee was employed by the Company and the denominator of which is 365. The resulting Award shall be paid to Employee in accordance with Section 2 above.

(d)For purposes of this Agreement, the following definitions will apply:

(i)“Cause” has the meaning ascribed to it in the written employment agreement between the Company and the Employee (as in effect on the date hereof). If the Employee has no written employment agreement with the Company, “Cause” shall mean (i) the Employee’s conviction of or plea of nolo contendere to a felony or other crime involving moral turpitude; (ii) the Employee’s fraud, theft or embezzlement committed with respect to the Company or any of its subsidiaries; or (iii) the Employee’s willful and continued failure to perform his material duties to the Company and its Subsidiaries, where the Company has provided written notice to the Employee of the failure and the Employee shall not have remedied such failure within then (10) business days following the effectiveness of such notice.

(ii)“Change of Control” shall mean any of the following which takes place after the Effective Date: (i) any Person or “group,” within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Act”), other than the Company or any of its subsidiaries or any trustee or other fiduciary holding securities under an employee benefit plan of the Company or one of its subsidiaries, becomes a beneficial owner, directly or indirectly, in one or a series of transactions, of securities representing fifty percent (50%) or more of the total number of votes that may be cast for the election of directors of the Company; (ii) any merger or consolidation involving the Company or any sale or other disposition of all or substantially all of the assets of the Company, or any combination of the foregoing, occurs and the beneficial owners of the Company’s voting securities outstanding immediately prior to such consolidation, merger, sale or other disposition do not, immediately following the consummation of such consolidation, merger, sale or other disposition, hold beneficial ownership, directly or indirectly, of securities representing fifty percent (50%) or more of the total number of votes that may be cast for election of directors of the surviving or resulting corporation in the case of any merger or consolidation or of the acquiring Person or Persons in the case of any sale or other disposition; or (iii) within twelve (12) months after a tender offer or exchange offer for voting securities of the Company (other than by the Company or any of its subsidiaries), individuals who are Continuing Directors shall cease to constitute a majority of the Board. For the purpose of this definition, the term “beneficial owner” (and correlative terms, including “beneficial ownership”) shall have the meaning set forth in Rule 13d-3 under the Act. provided in each such

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case such event is also a “change in control event” within the meaning of Treas. Reg. § 1.409A-3(i)(5)(1) (or similar applicable regulation under Section 409A of the Code).

(iii)“Disability” has the meaning ascribed to it in the written employment agreement between the Company and the Employee (as in effect on the date hereof). If the Employee has no written employment agreement with the Company, “Disability” shall mean Employee (i) is unable to engage in any substantial gainful activity 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 six (6) months, or (ii) 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 six (6) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company.

(iv)“Good Reason” has the meaning ascribed to it in the written employment agreement between the Company and the Employee (as in effect on the date hereof), where the Employee provides notice of the Good Reason event within 90 days of its occurrence and provides the Company at least 30 days to cure such matter. If the Employee has no written employment agreement with the Company, “Good Reason” shall mean a requirement that the Employee relocate more than fifty (50) miles from his then-current principal residence, it being understood that the Employee may be required to travel frequently and that prolonged periods spent away from Employee’s principal residence shall not constitute Good Reason.

(v)“Person” means any individual, partnership, limited liability company, corporation, association, trust, joint venture, unincorporated organization, or other entity or group.

3.Clawback. If an Employee receives an Award payout under the MIC based on financial statements that are subsequently required to be restated in a way that would decrease the amount of the Award to which the Employee was entitled, the Employee will refund to the Company the difference between what the Employee received and what the Employee should have received; provided that (i) the value of any difference to be refunded will be determined net of withholding and (ii) no refund will be required for Awards paid more than three years prior to the date on which the Company is required to prepare the applicable restatement. The value of any difference to be refunded will be determined in a manner consistent with regulations the Securities and Exchange Commission may adopt pursuant to Section 945 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

4.Confidentiality.

(a)Employee acknowledges that the Company and its subsidiaries continually develop Confidential Information (defined below), that the Employee may develop Confidential Information for the Company or its subsidiaries during Employee’s employment with the Company, and that Employee may learn of Confidential Information during the course of such employment. Employee will comply with the policies and procedures of the Company and its subsidiaries for protecting Confidential Information and shall never use or disclose to any Person (except as required by applicable law or for the proper performance of his duties and responsibilities to the Company and its subsidiaries), any Confidential Information obtained by Employee incident to his employment or other association with the Company or any of its subsidiaries. Employee agrees to only use the Company’s Confidential Information as necessary to perform his or her job during employment with the Company. Employee understands that this restriction shall continue to apply after his employment terminates, regardless of the reason for such termination. All documents, records,

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tapes and other media of every kind and description relating to the business, present or otherwise, of the Company or its subsidiaries and any copies, in whole or in part, thereof (the “Documents”), whether or not prepared by Employee, shall be the sole and exclusive property of the Company and its subsidiaries. Employee shall safeguard all Documents and shall surrender to the Company at the time his employment terminates, or at such earlier time or times as the Board or its designee may specify, all Documents then in the Employee’s possession or control.

(b)For purposes of this Agreement, “Confidential Information” means any and all information of the Company and its subsidiaries that is not generally known by others with whom they compete or do business, or with whom they plan to compete or do business and any and all information which, if disclosed by the Company or its subsidiaries, would assist in competition against them. Confidential Information includes without limitation such information relating to (i) the development, research, testing, manufacturing, marketing and financial activities of the Company and its subsidiaries, (ii) the Company and its subsidiaries Products (defined below), (iii) the costs, sources of supply, financial performance and strategic plans of the Company and its subsidiaries, (iv) the identity and special needs of the customers of the Company and its subsidiaries and (v) the people and organizations with whom the Company and its subsidiaries have business relationships and those relationships. Confidential Information also includes any information that the Company or any of its subsidiaries have received, or may receive hereafter, from others which was received by the Company or any of its subsidiaries with any understanding, express or implied, that the information would not be disclosed. For purposes of this Agreement, “Products” mean all products planned, researched, developed, tested, manufactured, sold, licensed, leased or otherwise distributed or put into use by the Company or any of its subsidiaries, together with all services provided or planned by the Company or any of its subsidiaries, during Employee’s employment with the Company or any of its subsidiaries.

5.Restricted Activities. Employee, as a condition to participation in the MIC and in consideration of Participant's continued employment by the Company and/or its subsidiaries, agrees that some restrictions on his activities during and after his employment are necessary to protect the goodwill, Confidential Information and other legitimate interests of the Company and its subsidiaries and agrees as follows:

(a)For a period of time beginning on the date Employee executes a copy of this Agreement and continuing for a period ending on the date which is one (1) year after Employee’s employment terminates (the “Non-Competition Period”) Employee shall not, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, engage in, assist or have any active interest in a business that competes with the Company or any of its subsidiaries or otherwise compete with the Company or any of its subsidiaries: (i) anywhere throughout the world; (ii) in North America; (iii) in South America; (iv) in Europe; (v) in Asia; (vi) in Australia; (vii) in the United States; (viii) in those states of the United States in which the Company or any of its subsidiaries sells products or conducts business activities. Specifically, but without limiting the foregoing, Employee agrees that during the Non-Competition Period, Employee shall not: (A) undertake any planning for any business competitive with the Company or any of its subsidiaries; or (B) engage in any manner in any activity that is competitive with the business of the Company or any of its subsidiaries. For the purposes of this Section 6, Employee’s undertaking shall encompass all items, products and services that may be used in substitution for Products.

(b)Employee agrees that, during his employment with the Company, he will not undertake any outside activity, whether or not competitive with the business of the Company or its subsidiaries that could reasonably give rise to a conflict of interest or otherwise interfere with his duties and obligations to the Company or any of its subsidiaries.

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(c)Employee further agrees that while he is employed by the Company and during the Non-Competition Period, Employee will not, (i) hire or attempt to hire any employee of the Company or any of its subsidiaries, (ii) hire or attempt to hire any independent contractor providing services to the Company or any of its subsidiaries, (iii) assist in hiring or any attempt to hire anyone identified in clauses (i) or (ii) of this sentence by any other Person, (iv) encourage any employee or independent contractor of the Company or any of its subsidiaries to terminate his or her relationship with the Company or any of its subsidiaries, or (v) solicit or encourage any customer or vendor of the Company or any of its subsidiaries to terminate or diminish its relationship with any of them, or, in the case of a customer, to conduct with any Person any competing business or activity. For purposes of Employee’s obligations hereunder during that portion of the Non-Competition Period that follows termination of Employee’s employment, employee, independent contractor, customer or vendor of the Company or any of its subsidiaries shall mean any Person who was such at any time during the six (6) months immediately preceding the date of the termination of Employee’s employment.

(d)In the event that the one (1) year period stated above is held unenforceable by a court of competent jurisdiction due to its length, then the period shall be six (6) months or such other time as determined enforceable by such court.

6.Non-Inducement. Employee will not directly or indirectly assist or encourage any person or entity in carrying out or conducting any activity that would be prohibited by this Agreement if such activity were carried out or conducted by me.

7.Assignment of Rights to Intellectual Property. Employee shall promptly and fully disclose all Intellectual Property (defined below) to the Company. Employee hereby assigns and agrees to assign to the Company (or as otherwise directed by the Company) Employee’s full right, title and interest in and to all Intellectual Property. Employee agrees to execute any and all applications for domestic and foreign patents, copyrights or other proprietary rights and to do such other acts (including without limitation the execution and delivery of instruments of further assurance or confirmation) requested by the Company to assign the Intellectual Property to the Company and to permit the Company to enforce any patents, copyrights or other proprietary rights to the Intellectual Property. Employee will not charge the Company for time spent in complying with these obligations. All copyrightable works that Employee creates shall be considered “work made for hire” and shall, upon creation, be owned exclusively by the Company. For purposes of this Section 8, “Intellectual Property” means inventions, discoveries, developments, methods, processes, compositions, works, concepts and ideas (whether or not patentable or copyrightable or constituting trade secrets) conceived, made, created, developed or reduced to practice by Employee (whether alone or with others and whether or not during normal business hours or on or off the premises of the Company or any of its subsidiaries) during Employee’s employment with the Company or any of its subsidiaries (including prior to the Effective Date if applicable) that relate to either the Products or any prospective activity of the Company or any of its subsidiaries or that make use of Confidential Information or any of the equipment or facilities of the Company or any of its subsidiaries.

8.Consideration and Acknowledgments. Employee acknowledges and agrees that the covenants described in Sections 4 through 8 of this Agreement are essential terms, and the underlying Management Incentive Compensation Award would not be provided by the Company in the absence of these covenants. Employee further acknowledges that these covenants are supported by adequate consideration as set forth in this Agreement, that full compliance with these covenants will not prevent Employee from earning a livelihood following the termination of his or her employment, and that these covenants do not place undue restraint on Employee and are not in conflict with any public interest. Employee further acknowledges and agrees that Employee fully understands these covenants, has had full and complete

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opportunity to discuss and resolve any ambiguities or uncertainties regarding these covenants before signing this Agreement, that these covenants are reasonable and enforceable in every respect, and has voluntarily agreed to comply with these covenants for their stated term. Employee agrees that in the event he or she is offered employment with a competing business at any time in the future, Employee shall immediately notify the competing business of the existence of the covenants set forth above.

9.Enforceability; General Provisions.

(a)Employee agrees that the restrictions contained in this Agreement are reasonable and necessary to protect the Company’s legitimate business interests and that full compliance with the terms of this Agreement will not prevent Employee from earning a livelihood following the termination of employment, and that these covenants do not place undue restraint on Employee.

(b)Because the Company’s current base of operations is in North Carolina, Employee consents to the jurisdiction of the state and federal courts of North Carolina with respect to any claim arising out of this Agreement.

(c)Employee acknowledges that in the event of a breach or a threatened breach of this Agreement, the Company will face irreparable injury which may be difficult to calculate in dollar terms and that the Company shall be entitled, in addition to all remedies otherwise available in law or in equity, to temporary restraining orders and preliminary and final injunctions enjoining such breach or threatened breach in any court of competent jurisdiction without the necessity of posting a surety bond, as well as to obtain an equitable accounting of all profits or benefits arising out of any violation of this Agreement.

(d)Employee agrees that if a court determines that any of the provisions in this Agreement is unenforceable or unreasonable in duration, territory, or scope, then that court shall modify those provisions so they are reasonable and enforceable, and enforce those provisions as modified.

(e)If any phrase or provision of this Agreement is declared invalid or unenforceable by a court of competent jurisdiction, that phrase, clause or provision shall be deemed severed from this Agreement, and will not affect the enforceability of any other provisions of this Agreement, which shall otherwise remain in full force and effect.

(f)Waiver of any of the provisions of this Agreement by the Company in any particular instance shall not be deemed to be a waiver of any provision in any other instance and/or of the Company’s other rights at law or under this Agreement.

(g)Employee agrees that the Company may assign its rights under this Agreement to its successors and that any such successor may stand in the Company’s shoes for purposes of enforcing this Agreement.

(h)Employee agrees to reimburse Company for all attorneys’ fees, costs, and expenses that it reasonably incurs in connection with enforcing its rights and remedies under this Agreement, but only to the extent the Company is ultimately the prevailing party in the applicable legal proceedings.

(i)If Employee violates this Agreement, then the restrictions set out in Sections 4 - 8 shall be extended by the same period of time as the period of time during which the violation(s) occurred.

(j)Employee fully understands Employee’s obligations in this Agreement, has had full and complete opportunity to discuss and resolve any ambiguities or uncertainties regarding these covenants

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before signing this Agreement, and has voluntarily agreed to comply with these covenants for their stated terms.

(k)Employee agrees that in the event Employee receives an offer of employment at any time in the future with any entity that may be considered a Competing Business Line, Employee shall immediately notify such Competing Business of the existence and terms of this Agreement. Employee also understands and agrees that the Company may notify anyone later employing Employee of the existence and provisions of this Agreement.

(l)Employee agrees that Employee’s obligations under Sections 4 through this Section 10 will survive the payment or forfeiture of the Award hereunder and continue for the duration of Employee’s employment with the Company, and thereafter to the extent stated in their terms.

10.Miscellaneous.

(a)No Assignment. No right or benefit or payment under the Plan shall be subject to assignment or other transfer nor shall it be liable or subject in any manner to attachment, garnishment or execution.

(b)Employment Rights. This Agreement shall not create any right of the Employee to continued employment with the Company or its Affiliates or limit the right of Company or its Affiliates to terminate the Employee’s employment at any time and shall not create any right of the Employee to employment with the Company or any of its Affiliates. Except to the extent required by applicable law that cannot be waived, the loss of the Award shall not constitute an element of damages in the event of termination of the Employee’s employment even if the termination is determined to be in violation of an obligation of the Company or its Affiliates to the Employee by contract or otherwise.

(c)Unfunded Status. The obligations of the Company hereunder shall be contractual only. The Employee shall rely solely on the unsecured promise of the Company and nothing herein shall be construed to give the Employee or any other person or persons any right, title, interest or claim in or to any specific asset, fund, reserve, account or property of any kind whatsoever owned by the Company or any Affiliate.

(d)Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction will not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction. In the event that any provision hereof would, under applicable law, be invalid or unenforceable in any respect, such provision will be construed by modifying or limiting it so as to be valid and enforceable to the maximum extent compatible with, and possible under, applicable law.

(e)Employee Acknowledgments. Employee acknowledges that (i) Employee has had access to Company’s trade secrets and Confidential Information at the highest levels, including without limitation manufacturing and marketing strategy, customer strategy and lists, technical know-how, product and process research and development, and business plans, (ii) Employee has had access to Confidential Information regarding and has been privy to discussions and strategy sessions at the highest levels of the Company regarding all aspects, business lines and product segments of the Company, and (iii) that these trade secrets and Confidential Information would inevitably be disclosed were Employee to work for a competitor.

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(f)Governing Law. This Agreement and all actions arising in whole or in part under or in connection herewith, will be governed by and construed in accordance with the domestic substantive laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction.

(g)Conflicts. To the extent there are any conflicts between provisions this Agreement and any applicable employment agreement entered into between Employee and the Company or its subsidiaries, the provisions of such employment agreement shall govern and nothing in this Agreement shall in any way amend, supersede or otherwise change any provisions or rights contained in such employment agreement.

(h)409A. The Award shall be construed and administered consistent with the intent that it be at all times in compliance with, or exempt from, the requirements of Section 409A of the Internal Revenue Code and the regulations thereunder.

(i)Section 162(m). The Award shall be construed and administered consistent with the intent that it qualify to the maximum extent possible as qualifying performance-based compensation within the meaning of Section 162(m) of the Internal Revenue Code and the regulations thereunder.

(j)Amendment. This Agreement may be amended only by mutual written agreement of the parties.

IN WITNESS WHEREOF, Xerium Technologies, Inc. and Employee have executed this Management Incentive Compensation Agreement as of the date first written above.

Xerium Technologies, Inc.

By:    
Name:    Michael Bly
Title:    EVP of Global Human Resources

Acknowledged and agreed:

Employee

Signature:    

Printed Name:    _________        

Date:    

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Schedule 1

(a)Target Award: ___% of base compensation

(b)Metric. One measure of performance will be used in determining the formula adjustment under the Award: Xerium 2014 Bank Adjusted EBITDA. The “Bank Adjusted EBITDA” means “Adjusted EBITDA,” as such term is defined in the Credit and Guaranty Agreement (the “Credit Agreement”), dated as of May 26, 2011, entered into by and among the Company, certain subsidiaries of the Company, Citibank N.A., as administrative agent, and other agents and banks party thereto, as in effect for Xerium Technologies, Inc. for the year ended December 31, 2014.

(c)Currency Adjustments. The final Bank Adjusted EBITDA will be adjusted at the end of the year to reflect currency fluctuations relative to the US$ in all markets. Any adjustments made will be based on the following budgeted rates:

Foreign Exchange Rates
ARS	$0.12669
AUD	$0.86590
BRL	$0.43036
CAD	$0.96621
CHF	$0.99322
CNY	$0.16529
EUR	$1.28000
GBP	$1.58500
JPY	$0.00939
MXN	$0.08139
NOK	$0.16356
SEK	$0.15536
VND	$0.00005

(d)Target and Formula. The minimum, target and maximum thresholds of Bank Adjusted EBITDA for 2014 shall be set by the Committee and delivered to the Employee in a separate writing; provided, however, that the amounts may be adjusted by the Committee after the initial determination of the amounts to reflect any material change of circumstance, including without limitation, the acquisition or disposition of any business by the Company or any of its subsidiaries.

Bank Adjusted EBITDA	Minimum	Target	Maximum
Percentage of Target Award Payable	0%	100%	150%

The formula amount payable with respect to an Award shall be determined as follows (where “X” below refers to the portion of the target award for a Participant under an Award):

• Bank Adjusted EBITDA Metric below minimum:    Award = no payment

• Bank Adjusted EBITDA Metric equal to minimum:    Award = 0

• Bank Adjusted EBITDA Metric at target:     Award = X

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• Bank Adjusted EBITDA Metric at maximum or above:     Award = 1.5X

The amount payable between the levels of Bank Adjusted EBITDA identified above shall be determined on the basis of straight line interpolation between points.

(e)The Committee may in its sole discretion adjust Award amount determined under subsection (e) upwards or downwards by 20% based on the following individual goals associated with the Company’s restructuring projects:

The Committee has delegated such authority (except with respect to his own Award) to the President and Chief Executive Officer of the Company.

The amount payable with respect to an Award shall in all cases be capped at one hundred eighty percent (180%) of a Participant’s target Award (1.8X).

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EX-10.2

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT (this “Contract”) is made in Shanghai, People’s Republic of China (“PRC”), on March 17, 2014,by and between:

Huyck Wangner (Shanghai) Trading Co., Ltd., with its registered address at Room 1508, 12th Floor, No. 596, Middle Longhua Road, Shanghai, P.R.China (the “Company”), and

Paul Wern-Lirn Wang (Passport Number: 710714535), with residential address at No. 150, 68 Nong, Zhifa Rd., Qingpu District, Shanghai, 201703, P.R.China. (“You”).

In this Contract, the Company and you are referred to collectively as the “Parties” and each individually as a “Party.”

1.EMPLOYMENT TERM

1.1 The term of this Contract is five years, commencing from 10 March, 2014 (the “Commencement Date”) to 9 March, 2019 (the “Expiration Date”). Three (3) months before the expiration of this contract, either party could issue to the other party a written request to extend this employment contract.  If the company decides not to extend this employment contract, then the termination clause in section 14.1 will apply.

1.2 Your probationary period shall be for a period of six (6) months commencing from the Commencement Date (the “Probationary Period”). The Probationary Period is included in your employment term.

2.POSITION AND DUTIES

2.1 Your position in the Company is President of China - Xerium Technologies. You agree to perform those job duties and functions of the position as set forth and described in the attached Exhibit A. You further agree that the Company in its discretion may reasonably change your job on a temporary or a permanent basis pursuant to business requirements and your work performance.

2.2 You will perform all duties and services hereunder in good faith and to the best of your ability. You agree to devote your working time, attention, and energies to the business of the Company and to be available at all reasonable times to perform such work as the Company may require.

2.3 Your working location is the Company in Shanghai. You agree to work at any other place that the Company may designate within the PRC. You may also be required to make business trips both inside and outside the PRC as required for the proper performance of your duties.

3. LABOR PROTECTION AND WORKING CONDITIONS

3.1 According to the actual circumstances of the work done and the actual position held by you, the Company shall provide you with a safe environment in accordance with PRC laws and regulations.

4. REPRESENTATIONS, WARRANTIES, AND UNDERTAKINGS

4.1 You hereby represent, warrant, and undertake the following:

(a) that throughout the term of this Contract, your provision of services to the Company under this Contract does not violate any contractual or statutory obligations;

(b) that as of the Commencement Date and throughout the term of this Contract, you possess the governmental permits/registrations necessary to work at the Company at its present location;

(c) that as of the Commencement Date, you possess the professional qualifications, licenses, and/or permits necessary to perform the job duties set out in this Contract and that you will maintain such qualifications, licenses, and/or permits throughout the term of this Contract;

(d) that as of the Commencement Date, you are not bound by or subject to any court order, agreement, arrangement, or undertaking, whether by contract or otherwise, which in any way restricts or prohibits you from entering into this Contract or performing your duties hereunder; and

(e) that all information that you provided to the Company during the recruitment period and thereafter, and throughout the term of this Contract, is true and correct.

5.COMPENSATION AND SOCIAL INSURANCE

5.1 Your annual salary is US$165,000 before withholding of applicable tax and your individual portion of social insurance (or other) contributions (if applicable). The Company may revise your base salary in case of change of your position.

5.2 The Company will provide you with the following allowances:

(i) Annual housing allowance (for serviced apartment including rental, fees and utilities) of US$110,000 per year during the term of this Contract.

(ii) Standard expatriate medical plan coverage administered by Ambassador as provided to US expatriates currently in China.

(iii) Annual child education allowance for your two daughters upon presenting actual school invoices (which currently is US$62,000 annually), until they graduate from high school.

(iv) A car and a driver, which will be arranged in accordance with company policy.

5.3 You annual salary and annual housing allowance will be paid to your bank account designated by you in twelve equal installments per year in RMB (converted at the middle rate published by People's Bank of China on the 20th day of every month). The payroll date for each month is the 5th day of the next month.

5.4 You are eligible to participate in the annual incentive plan of Xerium Technologies, Inc. ("Xerium") at a target participation level of 50% of base salary. During your first year, your incentive award will be pro-rated for 2014 based on your actual hire date. Please note that awards under the annual incentive plan and their terms are subject to the approval and discretion of the Compensation Committee of the Board of Directors of Xerium.

5.5 You are eligible to participate in the Long Term Incentive Program of Xerium at 50% of your base pay per year. During your first year, your incentive award will be pro-rated for 2014 based on your actual hire date. Please note that awards under the Long Term Incentive Program and their terms are subject to the approval and discretion of the Compensation Committee of the Board of Directors of Xerium.

5.6 In addition to other performance factors, in order to be eligible to receive the above awards, you must be performing services for the Company on the date of the awards payment. If you have not worked for the full award period, you may be eligible for a pro-rated award according to the duration of your employment in the award period. The Company reserves the right to vary, alter or discontinue any incentive plan and/or the terms of participation in any incentive plan from time to time with notice to you. The fact that an award is paid in one year is no guarantee that awards will be paid in subsequent years.

5.7 If required by applicable national and local rules, the Company will enroll you in various social insurance and benefit schemes in accordance therewith. The Parties will make their respective contributions for social insurance and welfare in accordance with the applicable national and local rules. The Company is entitled to withhold the contribution payable by you from your monthly base salary and pay it to the relevant governmental authorities in accordance with PRC law.

5.8 In addition to statutory social insurance benefits, you will be eligible to participate in any benefit plans that the Company establishes from time to time for its employees in China, at such times as you qualify for them or, as the case may be, as you are selected for participation in them. The Company reserves the right to amend or discontinue such benefit plans in its sole discretion with notice to you.

5.9 You will pay individual income tax in accordance with PRC law, the amount of which the Company shall withhold from your monthly income.

6. WORKING HOURS, STATUTORY HOLIDAYS AND ANNUAL LEAVE

6.1 Subject to the governmental approval as required by law, you are subject to a non-fixed working hour system and your working hours are not restricted by the normal office hours as may be prescribed in the employee handbook of the Company.

6.2 You understand that you will be entitled to the statutory holidays specified by the PRC government.

6.3 Your annual leave entitlement is twenty (20) working days each full calendar year and will be pro-rated during partial years of employment.

6.4 All annual leave taken by you will first satisfy any statutory entitlement to annual leave before satisfying any additional annual leave entitlement.

6.5 Annual leave for each year may not be carried forward without the approval of the Company and shall be taken at times approved by Company.

7.SERVICE WORKS, INVENTIONS AND CREATIONS

7.1 The copyright, patent application right, patent or ownership of any ideas, works, inventions, designs, devices, machines, masks, models, work in process, deliverables, products, procedures, improvements, developments, drawings, notes, documents, information and materials, creations, computer programs, know-how, trade secrets and proprietary information (“Work Product”), which are made, conceived or developed by you alone or in conjunction with others during the term of this Contract and one (1) year after the Expiration Date, shall belong to the Company so long as such Work Product is related to your duties or tasks assigned by the Company or are made, conceived or developed by utilizing the Company’s material and technical conditions such as funds, equipment, technology, confidential or proprietary information. In addition, the provisions of this Article shall be binding upon your successors and assigns.

8.CONFIDENTIALITY

8.1 Without prior written consent from the Company, you shall not at any time during the employment term or thereafter use for your own account or divulge to any person, firm, or company (and shall at all times use your best efforts to prevent the publication or disclosure of) any Confidential Information. For the purposes of this Article, “Confidential Information” shall mean any and all confidential or proprietary information concerning the business and affairs of the Company and its affiliates, including, without limitation, personal data regarding employees, secondees or any other individual’s personal data, data files, manuals, photographs, graphs, drawings, price lists, program information, financial data, market studies and strategies, business plans, and any other information, however documented. Confidential Information also includes, without limitation, any business secrets within the meaning of Article 10 of the PRC Anti-Unfair Competition Law. Your confidentiality obligations will survive the termination of your employment with the Company. Upon the Company’s demand, you agree immediately to surrender to the Company all originals and copies of documents, samples and all other items of whatever nature relating to any matter aforesaid and all items of whatever description belonging to the Company. You understand that Confidential Information does not include any of the foregoing items which has become publicly known and made generally available through

no wrongful act of you or of others who were under confidentiality obligations as to the item or items involved.

8.2 You agree that you will not, during your employment with the Company, improperly use or disclose any proprietary information or trade secrets of any former employer or other person or entity and that you will not bring onto the Company’s premises any unpublished document or proprietary information belonging to any such employer, person or entity without written consent from such employer, person or entity.

8.3 You recognize that the Company has received and in the future will receive from third parties their confidential or proprietary information subject to a duty on the Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out your work for the Company consistent with the Company’s agreement with such third party.

8.4 You understand and acknowledge that you are required to immediately disclose to the Company, clearly, fully, in writing and in detail, any and all material information that you learn about prospective customers, business partners, and competitors of the Company.

9.NON-SOLICITATION

9.1 For two (2) years after the termination of your employment, you will not directly or indirectly (whether as owner, partner, employee/secondee or otherwise) induce an employee, secondee, contractor or consultant of the Company to terminate an employment/employment relationship (of whatever form) with the Company, or solicit, hire, attempt to hire or employ any employee, secondee, contractor or consultant of the Company.

10.NON-BRIBERY

10.1 You will not give or promise any payment or gift of money or anything of value to officials (including officers or the employees of a government or regulatory agency, political parties and candidates, and the employees of state-owned entities) with the intent to induce such officials to use their authority to help you or the Company or any affiliated company for personal gain or for that of the Company or an affiliated company. You further agree that you will not demand or accept any payment or other benefit in money or in kind offered to you or your family members from any person as an inducement or reward for any act or forbearance or in connection with any matter or business transacted by or on behalf of the Company.

11.NON-COMPETITION

11.1 You agree that during the term of your employment and for two (2) years after the date of termination of your employment at the Company (“Post EmploymentNon-Compete Period”), you will not directly or indirectly (whether as owner, partner, employee/secondee

or otherwise) interfere with business relationships between the Company and any customer or targeted customer, nor will you, directly or indirectly, for your interests or the interests of any party other than the Company, engage in any “Competing Business” in the PRC or hold a position in any entity that engages in any Competing Business. “Competing Business” means any business competing with the Company and its affiliated companies for market share, customers, or talent.

11.2 You hereby agree that the Company has the option in its sole discretion, whether to require you to fulfill the non-compete obligations during the Post Employment Non-Compete Period set forth in this Article 11. If and only if the Company chooses to require you to fulfill the non-compete obligations during the Post Employment Non-Compete Period set forth in Article 11, the Company shall pay you for every twelve (12) months during the Post Employment Non-Compete Period an amount equal to 30% (thirty percent) of your annual wages, or the minimum amount required by the applicable laws in effect at the Expiration Date, whichever is higher (“Non-Compete Compensation”). Your “annual wages” in this Article 11 means the total of the base salary and any bonus paid to you during the twelve (12) months immediately preceding the Expiration Date.

11.3 The Company will pay the Non-Compete Compensation to you in installments on a monthly basis. If at the time of the Expiration Date, the applicable laws or regulations require a different payment date or schedule, the Company will comply with such laws or regulations and adjust the payment schedule accordingly.

11.4 If you fail to comply with Section 11.1 above, in addition to repayment of all the Non-Compete Compensation you have received, you will pay the Company liquidated damages in the amount of three times your annual salary or as otherwise permitted by law. If the liquidated damages cannot cover the loss that the Company suffers as a result of your breach of Section 11.1, the Company may claim further damages from you.

12.WORK RULES

12.1 The Company reserves the right to monitor email, internet and computer usage or perform background checks and/or drug tests. You are not allowed to move the Company’s data to personal storage devices (for example, iPods, digital cameras, external flash drives, portable hard drives, or any other non-Company equipment) at any time, and doing so may result in discipline, including summary termination of employment.

13.PERSONAL INFORMATION

13.1 You consent to the processing by the Company of personal data of which you are the subject. You agree that the data may be collected and held by the Company, or be disclosed or transferred to other employees/secondees of the Company (including if necessary to other affiliates of the Company outside the PRC) or to any other person as may be reasonably necessary or as otherwise permitted by PRC law.

14.TERMINATION OF EMPLOYMENT

14.1 The Company may terminate your employment with immediate effect under any circumstances allowable by law and the terms of this Contract or any subsequent amendments thereto. In the event that your employment is terminated by the Company according to the PRC laws, in which case any statutory severance compensation is required for such termination, the Company agrees to giving you thirty (30) days’ prior written notice and pay to you twelve (12) months of your monthly base salary as severance compensation (including any statutory severance compensation, if it is required under PRC laws for such termination).

14.2 Both Parties may terminate your employment by giving thirty (30) days’ prior written notice to the other Party, unless PRC law or this Contract provides otherwise.

14.3 The Company may suspend your duties when you are subject to an investigation of any disciplinary or legal matter, in which case the Company will pay the appropriate compensation or living allowance in accordance with applicable laws and regulations. If the investigation reveals that you have committed any disciplinary or legal offence, the Company will be entitled to terminate your employment.

14.4 The Company reserves the right to require you to not attend work and/or to not undertake all or any of your duties at any time, including during any period of notice.

14.5 On or before the termination of your employment with the Company, you shall return to the Company all property and belongings of the Company, including such items as mobile phones, laptop computers, documents, files, credit cards or keys (as applicable). You acknowledge and agree that the failure to do so shall entitle the Company to withhold payment of your final paycheck temporarily and/or any other payable item or to deduct an amount equivalent to the cost of such property from such payables.

14.6 You will not represent yourself or cause or allow yourself to be represented as being in any way connected with the Company after the termination of your employment.

14.7 In the event that your employment with the Company terminates, you hereby consent to the notification to your new employer of your continuing rights and obligations under this Contract. Further, you agree that you will provide your prospective employers with notice of your obligations to the Company.

15.LIABILITY FOR BREACH OF CONTRACT

15.1 In addition to the liquidated damages provided under this Contract or other agreements between the Parties or as provided by applicable PRC law or regulations, a Party shall compensate for the other Party’s direct loss as a result of its breach of this Contract.

16. GOVERNING LAW AND HANDLING OF LABOR DISPUTES

16.1 This Contract shall be interpreted and enforced in accordance with PRC law.

16.2 The Company and you agree that we will first endeavor to reach an amicable settlement of any labor dispute arising out of this Contract through mutual negotiations. If the dispute is not resolved within thirty (30) days after the commencement of negotiations, either Party may submit the labor dispute for arbitration to the labor dispute arbitration commission with jurisdiction over the matter. Any such proceeding shall be closed to the public.

17.MISCELLANEOUS PROVISIONS

17.1 This Contract is executed in English languages in two (2) originals. Each Party will hold one (1) executed original.

17.2 This Contract may be amended only by a written agreement signed by both Parties.

17.3 In the event that any term hereof conflicts with the rules and regulations of the Company, this Contract will prevail. Any matters that have not been addressed in this Contract will be handled in accordance with the rules and regulations of the Company.

17.4 If any provision of this Contract is determined to be invalid or unenforceable, in whole or in part, this determination will not affect any other provision of this Contract.

17.5 Failure or delay on the part of any Party to exercise any right or privilege under this Contract shall not operate as a waiver of such right or privilege, nor shall any partial exercise of any right or privilege preclude any further exercise thereof. Any waiver by a Party at any time of a breach of any term or provision of this Contract shall not be construed as a waiver by such Party of any subsequent breach, its rights in such provision, or any of its other rights hereunder.

17.6 Articles 8, 9 and 11 shall survive the termination of this Contract.

17.7 The headings contained in this Contract are for reference only and shall not be deemed to be a part of this Contract or to affect the meaning or interpretation hereof.

17.8 Any exhibit referred to in this Contract shall be incorporated herein and made a part hereof.

17.9 This Contract supersedes any prior oral or written agreements between the Parties relating to your employment with the Company.

17.10 You represent and warrant that you have read and understood all provisions of this Contract and have had an opportunity to confer with anyone of your choosing regarding the contents of this Contract.

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

Huyck Wangner (Shanghai) Trading Co., Ltd.

(Seal)

/s/ Michael Bly______________

Name: Michael Bly

Title: EVP of Global Human Resources

Date: 3/23/14

Employee:

/s/ Wern-Lirn Wang________

Name: Paul Wern-Lirn Wang

Passport Number: 710714535

Date:

EMPLOYMENT CONTRACT

THIS EMPLOYMENT CONTRACT (this “Contract”) is made in Hong Kong, on March 17, 2014,by and between:

Xerium Asia Holding Limited. &c/o Tricor Services Limited, with its registered address at Level 54 Hopewell Centre, 183 Queen’s Road East, Hong Kong (the “Company”), and

Paul Wern-Lirn Wang (Passport Number: 710714535), with residential address at No. 150, 68 Nong, Zhifa Rd., Qingpu District, Shanghai, 201703, P.R.China. (“You”).

In this Contract, the Company and you are referred to collectively as the “Parties” and each individually as a “Party.”

1.EMPLOYMENT TERM

1.1 The term of this Contract is five years, commencing from 10 March, 2014 (the “Commencement Date”) to 9 March, 2019 (the “Expiration Date”). Three (3) months before the expiration of this contract, either party could issue to the other party a written request to extend this employment contract.  If the company decides not to extend this employment contract, then the termination clause in section 14.1 will apply.

1.2 Your probationary period shall be for a period of six (6) months commencing from the Commencement Date (the “Probationary Period”). The Probationary Period is included in your employment term.

2.POSITION AND DUTIES

2.1 Your position in the Company is President of Asia - Xerium Technologies. You agree to perform those job duties and functions of the position as set forth and described in the attached Exhibit A. You further agree that the Company in its discretion may reasonably change your job on a temporary or a permanent basis pursuant to business requirements and your work performance.

2.2 You will perform all duties and services hereunder in good faith and to the best of your ability. You agree to devote your working time, attention, and energies to the business of the Company and to be available at all reasonable times to perform such work as the Company may require.

2.3 You may be required to make business trips in the Asia Pacific Region as required for the proper performance of your duties.

3. LABOR PROTECTION AND WORKING CONDITIONS

3.1 According to the actual circumstances of the work done and the actual position held by you, the Company shall provide you with a safe environment in accordance with applicable laws and regulations.

4. REPRESENTATIONS, WARRANTIES, AND UNDERTAKINGS

4.1 You hereby represent, warrant, and undertake the following:

(a) that throughout the term of this Contract, your provision of services to the Company under this Contract does not violate any contractual or statutory obligations;

(b) that as of the Commencement Date and throughout the term of this Contract, you possess the governmental permits/registrations necessary to work and perform the job duties set out in this Contract;

(c) that as of the Commencement Date, you possess the professional qualifications, licenses, and/or permits necessary to perform the job duties set out in this Contract and that you will maintain such qualifications, licenses, and/or permits throughout the term of this Contract;

(d) that as of the Commencement Date, you are not bound by or subject to any court order, agreement, arrangement, or undertaking, whether by contract or otherwise, which in any way restricts or prohibits you from entering into this Contract or performing your duties hereunder; and

(e) that all information that you provided to the Company during the recruitment period and thereafter, and throughout the term of this Contract, is true and correct.

5.COMPENSATION AND SOCIAL INSURANCE

5.1 Your annual salary is US$135,000, inclusive of all taxes. The Company may revise your base salary in case of change of your position.

5.2 You annual salary will be paid to your bank account designated by you in twelve equal installments per year in US dollar currency.

5.3 You are eligible to participate in the annual incentive plan of Xerium Technologies, Inc. ("Xerium") at a target participation level of 50% of base salary. During your first year, your incentive award will be pro-rated for 2014 based on your actual hire date. Please note that awards under the annual incentive plan and their terms are subject to the approval and discretion of the Compensation Committee of the Board of Directors of Xerium.

5.4 You are eligible to participate in the Long Term Incentive Program of Xerium at 50% of your base pay per year. During your first year, your incentive award will be pro-rated for 2014 based on your actual hire date. Please note that awards under the Long Term Incentive Program and their terms are subject to the approval and discretion of the Compensation Committee of the Board of Directors of Xerium.

5.5 In addition to other performance factors, in order to be eligible to receive the above awards, you must be performing services for the Company on the date of the awards payment. If you have not worked for the full award period, you may be eligible for a pro-rated award according to the duration of your employment in the award period. The Company reserves the right to vary, alter or discontinue any incentive plan and/or the terms of participation in any incentive plan from time to time with notice to you. The fact that an award is paid in one year is no guarantee that awards will be paid in subsequent years.

5.6 In addition, you will be eligible to participate in any benefit plans that the Company establishes from time to time for its employees, at such times as you qualify for them or, as the case may be, as you are selected for participation in them. The Company reserves the right to amend or discontinue such benefit plans in its sole discretion with notice to you.

5.7 You will be solely responsible for payment of individual salaries tax.

6.SERVICE WORKS, INVENTIONS AND CREATIONS

6.1 The copyright, patent application right, patent or ownership of any ideas, works, inventions, designs, devices, machines, masks, models, work in process, deliverables, products, procedures, improvements, developments, drawings, notes, documents, information and materials, creations, computer programs, know-how, trade secrets and proprietary information (“Work Product”), which are made, conceived or developed by you alone or in conjunction with others during the term of this Contract and one (1) year after the Expiration Date, shall belong to the Company so long as such Work Product is related to your duties or tasks assigned by the Company or are made, conceived or developed by utilizing the Company’s material and technical conditions such as funds, equipment, technology, confidential or proprietary information. In addition, the provisions of this Article shall be binding upon your successors and assigns.

7.CONFIDENTIALITY

7.1 Without prior written consent from the Company, you shall not at any time during the employment term or thereafter use for your own account or divulge to any person, firm, or company (and shall at all times use your best efforts to prevent the publication or disclosure of) any Confidential Information. For the purposes of this Article, “Confidential Information” shall mean any and all confidential or proprietary information concerning the business and affairs of the Company and its affiliates, including, without limitation, personal data regarding employees, secondees or any other individual’s personal data, data files, manuals, photographs, graphs, drawings, price lists, program information, financial data, market studies and strategies, business plans, and any other information, however documented. Confidential Information also includes, without limitation, any business and/or trade secrets under Hong Kong law. Your confidentiality obligations will survive the termination of your employment with the Company. Upon the Company’s demand, you agree immediately to surrender to the Company all originals and copies of documents,

samples and all other items of whatever nature relating to any matter aforesaid and all items of whatever description belonging to the Company. You understand that Confidential Information does not include any of the foregoing items which has become publicly known and made generally available through no wrongful act of you or of others who were under confidentiality obligations as to the item or items involved.

7.2 You agree that you will not, during your employment with the Company, improperly use or disclose any proprietary information or trade secrets of any former employer or other person or entity and that you will not bring onto the Company’s premises any unpublished document or proprietary information belonging to any such employer, person or entity without written consent from such employer, person or entity.

7.3 You recognize that the Company has received and in the future will receive from third parties their confidential or proprietary information subject to a duty on the Company’s part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out your work for the Company consistent with the Company’s agreement with such third party.

7.4 You understand and acknowledge that you are required to immediately disclose to the Company, clearly, fully, in writing and in detail, any and all material information that you learn about prospective customers, business partners and competitors of the Company.

8.NON-SOLICITATION

8.1 For two (2) years after the termination of your employment, you will not directly or indirectly (whether as owner, partner, employee/secondee or otherwise) induce an employee, secondee, contractor or consultant of the Company with whom you have or had business dealings within the period of two (2) years prior to the date of termination of your employment at the Company to terminate an employment/employment relationship (of whatever form) with the Company, or solicit, hire, attempt to hire or employ any such employee, secondee, contractor or consultant of the Company.

9.NON-BRIBERY

9.1 You will not give or promise any payment or gift of money or anything of value to officials (including officers or the employees of a government or regulatory agency, political parties and candidates, and the employees of state-owned entities) with the intent to induce such officials to use their authority to help you or the Company or any affiliated company for personal gain or for that of the Company or an affiliated company. You further agree that you will not demand or accept any payment or other benefit in money or in kind offered to you or your family members from any person as an inducement or reward for any act or forbearance or in connection with any matter or business transacted by or on behalf of the Company. The foregoing shall be without prejudice to your general obligation to comply with all applicable anti-bribery laws.

10.NON-COMPETITION

10.1 You agree that during the term of your employment and for two (2) years after the date of termination of your employment at the Company (“Post EmploymentNon-Compete Period”), you will not directly or indirectly (whether as owner, partner, employee/secondee or otherwise) interfere with business relationships between the Company and any customer or targeted customer, nor will you, directly or indirectly, for your interests or the interests of any party other than the Company, engage in any “Competing Business” in the Asia Pacific region. “Competing Business” means any business competing with the Company and its affiliated companies for market share, customers, or talent.

10.2 If you fail to comply with Section 10.1 above, you will pay the Company liquidated damages in the amount of three times your annual salary or as otherwise permitted by law. If the liquidated damages cannot cover the loss that the Company suffers as a result of your breach of Section 10.1, the Company may claim further damages from you.

11.WORK RULES

11.1 The Company reserves the right to monitor email, internet and computer usage or perform background checks and/or drug tests. You are not allowed to move the Company’s data to personal storage devices (for example, iPods, digital cameras, external flash drives, portable hard drives, or any other non-Company equipment) at any time, and doing so may result in discipline, including summary termination of employment.

12.PERSONAL INFORMATION

12.1 You consent to the processing by the Company of personal data of which you are the subject for the purpose of human resources management, including without limitation recruitment, appointment, benefits, termination, performance appraisal and discipline. You agree that the data may be collected and held by the Company, or be disclosed or transferred to other employees/secondees of the Company (including if necessary to other affiliates of the Company outside Hong Kong) or to any other person as may be reasonably necessary or as otherwise permitted by Hong Kong law.

13.TERMINATION OF EMPLOYMENT

13.1 The Company may terminate your employment with thirty (30) days’ notice or payment in lieu under any circumstances allowable by law and the terms of this Contract or any subsequent amendments thereto.

13.2 Both Parties may terminate your employment by giving thirty (30) days’ prior written notice to the other Party.

13.3 In the event that your employment is terminated by the Company, save where such termination is for cause, the Company agrees to pay to you twelve (12) months of your monthly base salary as compensation (which shall be inclusive of any statutory severance

and/or redundancy payment, long service payment and all termination payments to which you are or may be entitled under all applicable laws in connection with such termination).

13.4 The Company may suspend your duties when you are subject to an investigation of any disciplinary or legal matter, in which case the Company will pay the appropriate compensation or living allowance in accordance with applicable laws and regulations. If the investigation reveals that you have committed any disciplinary or legal offence, the Company will be entitled to terminate your employment.

13.5 The Company reserves the right to require you to not attend work and/or to not undertake all or any of your duties at any time, including during any period of notice.

13.6 On or before the termination of your employment with the Company, you shall return to the Company all property and belongings of the Company, including such items as mobile phones, laptop computers, documents, files, credit cards or keys (as applicable). You acknowledge and agree that the failure to do so shall entitle the Company to withhold payment of your final paycheck temporarily and/or any other payable item or to deduct an amount equivalent to the cost of such property from such payables.

13.7 You will not represent yourself or cause or allow yourself to be represented as being in any way connected with the Company after the termination of your employment.

13.8 In the event that your employment with the Company terminates, you hereby consent to the notification to your new employer of your continuing rights and obligations under this Contract. Further, you agree that you will provide your prospective employers with notice of your obligations to the Company.

14.LIABILITY FOR BREACH OF CONTRACT

14.1 In addition to the liquidated damages provided under this Contract or other agreements between the Parties or as provided by applicable laws or regulations, a Party shall compensate for the other Party’s direct loss as a result of its breach of this Contract.

15. GOVERNING LAW AND HANDLING OF LABOR DISPUTES

15.1 This Contract shall be governed by Hong Kong law.

15.2 The Company and you agree that we will first endeavor to reach an amicable settlement of any labor dispute arising out of this Contract through mutual negotiations. If the dispute is not resolved within thirty (30) days after the commencement of negotiations, either Party may submit the labor dispute for determination by the courts of Hong Kong.

16.MISCELLANEOUS PROVISIONS

16.1 This Contract is executed in English language in two (2) originals. Each Party will hold one (1) executed original.

16.2 This Contract may be amended only by a written agreement signed by both Parties.

16.3 In the event that any term hereof conflicts with the rules and regulations of the Company, this Contract will prevail. Any matters that have not been addressed in this Contract will be handled in accordance with the rules and regulations of the Company.

16.4 If any provision of this Contract is determined to be invalid or unenforceable, in whole or in part, this determination will not affect any other provision of this Contract.

16.5 Failure or delay on the part of any Party to exercise any right or privilege under this Contract shall not operate as a waiver of such right or privilege, nor shall any partial exercise of any right or privilege preclude any further exercise thereof. Any waiver by a Party at any time of a breach of any term or provision of this Contract shall not be construed as a waiver by such Party of any subsequent breach, its rights in such provision, or any of its other rights hereunder.

16.6 Articles 7,8 and 10 shall survive the termination of this Contract.

16.7 The headings contained in this Contract are for reference only and shall not be deemed to be a part of this Contract or to affect the meaning or interpretation hereof.

16.8 Any exhibit referred to in this Contract shall be incorporated herein and made a part hereof.

16.9 This Contract supersedes any prior oral or written agreements between the Parties relating to your employment with the Company.

16.10 You represent and warrant that you have read and understood all provisions of this Contract and have had an opportunity to confer with anyone of your choosing regarding the contents of this Contract.

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

[Xerium]

(Seal)

/s/ Michael Bly____________

Name: Michael Bly

Title: EVP of Global Human Resources

Date: 3/18/14

Employee:

/s/ Wern-Lirn Wang_______

Name: Paul Wern-Lirn Wang

Passport Number: 710714535

Date:

EX-31.1

Exhibit 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

I, Harold C. Bevis, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Xerium Technologies, Inc. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2014

/s/ Harold C. Bevis

Harold C. Bevis

President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION

I, Clifford E. Pietrafitta, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Xerium Technologies, Inc. (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 8, 2014

/s/ Clifford E. Pietrafitta

Clifford E. Pietrafitta

Executive Vice President and CFO

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

SECTION 1350, CHAPTER 63 OF TITLE 18, UNITED STATES CODE,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned, as principal executive officer of Xerium Technologies, Inc. (the “Company”), does hereby certify that, to his knowledge:

1) the Company’s Form 10-Q for the period ended March 31, 2014, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) the information contained in the Company’s Form 10-Q for the period ended March 31, 2014, fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Harold C. Bevis

Harold C. Bevis

President and Chief Executive Officer

(Principal Executive Officer)

May 8, 2014

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

SECTION 1350, CHAPTER 63 OF TITLE 18, UNITED STATES CODE,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to Section 1350, Chapter 63 of Title 18, United States Code, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned, as principal financial officer of Xerium Technologies, Inc. (the “Company”), does hereby certify that, to his knowledge:

1) the Company’s Form 10-Q for the period ended March 31, 2014, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) the information contained in the Company’s Form 10-Q for the period ended March 31, 2014, fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Clifford E. Pietrafitta

Clifford E. Pietrafitta

Executive Vice President and CFO

(Principal Financial Officer)

May 8, 2014

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Components Of Net Periodic Benefit Cost (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Pensions, Other Post-Retirement And Post-Employment Benefits [Abstract]
Service cost	$ 816	$ 973
Interest cost	1,650	1,560
Expected return on plan assets	(1,564)	(1,412)
Amortization of prior service cost	0	3
Amortization of net loss	295	572
Net periodic benefit cost	$ 1,197	$ 1,696

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Stock-Based Compensation and Stockholders' Deficit - Additional Information (Detail) (USD $)			0 Months Ended	3 Months Ended	0 Months Ended	3 Months Ended	0 Months Ended	3 Months Ended			0 Months Ended			3 Months Ended			0 Months Ended		3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	May 08, 2012 2012 Executive Long-Term Incentive Plan [Member]	Mar. 31, 2014 2012 Executive Long-Term Incentive Plan [Member] Time Based Restricted Stock Units (RSU)	May 08, 2012 2012 Executive Long-Term Incentive Plan [Member] Time Based Awards	Mar. 31, 2014 2012 Executive Long-Term Incentive Plan [Member] Time Based Awards	May 08, 2012 2012 Executive Long-Term Incentive Plan [Member] Performance Based Awards	Mar. 31, 2014 2012 Executive Long-Term Incentive Plan [Member] Performance Based Awards	Mar. 31, 2014 2012 Executive Long-Term Incentive Plan [Member] Performance Based Awards Minimum	Mar. 31, 2014 2012 Executive Long-Term Incentive Plan [Member] Performance Based Awards Maximum	Jun. 13, 2013 2013 Executive Long-Term Incentive Plan [Member] Time Based Restricted Stock Units (RSU)	May 08, 2012 2013 Executive Long-Term Incentive Plan [Member] Time Based Awards	Jun. 13, 2013 2013 Executive Long-Term Incentive Plan [Member] Performance Based Awards	Mar. 31, 2014 2013 Executive Long-Term Incentive Plan [Member] Performance Based Awards	Jun. 13, 2013 2010 Equity Incentive Plan [Member]	Jun. 11, 2013 2010 Equity Incentive Plan [Member]	Aug. 15, 2012 Chief Executive Officer Chief Executive Officer Stock Plan	Aug. 15, 2012 Retiring Chief Executive Officer Chief Executive Officer Stock Plan	Mar. 31, 2014 Non-Management Directors Plan Deferred Stock Unit (DSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock units granted			54,750								179,571						204,208	50,000
Stock units vested				13,416
Share-based Compensation Arrangement by Share-based Payment Award, Percent of Target Award					50.00%		50.00%					50.00%		50.00%
Incentive plan description						Time-based awards, or 50% of the total target award, were granted in the form of 54,750 time-based RSUs under the Company’s 2012 Plan.		The performance-based awards will convert into shares of the Company’s common stock and be paid after the close of the three-year performance period. The amount of the payment will be based on a sliding scale ranging from 50% if the metric is achieved at 85% of the target up to 200% if the metric is achieved at or above 115% of the target.
Percentage of award on sliding scale									50.00%	200.00%
Percentage of payout based on company performance									85.00%	115.00%
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized															1,663,525	913,525
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized Per Individual															500,000	150,000
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Cash Award Per Participant Per Year															$ 2,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures																	781,701	27,900
Common stock, par value	$ 0.001	$ 0.001															$ 0.001
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period							3 years						3 years				3 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Contractual Term																	10 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price																	$ 4.00
Deferred Compensation Arrangement with Individual, Annual Retainer Per Director																			$ 112,000
Deferred Compensation Arrangement with Individual, Shares Awarded																			5,668,000
Deferred Compensation Arrangement with Individual, Shares Issued																			4,796,000

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Reconciliation Of Segment Earnings (Loss) To Income Before Provision For Income Taxes (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Segment Earnings (Loss):
Segment Earnings (Loss)	$ 12,594	$ 17,443
Stock-based compensation	(509)	(295)
Idle facility asset impairment	0	857
Interest expense, net	(8,657)	(9,206)
Depreciation and amortization	(8,649)	(9,542)
Restructuring expense	(4,651)	(1,255)
Plant startup costs	(176)	0
Income before provision for income taxes	3,060	7,988
Clothing
Segment Earnings (Loss):
Segment Earnings (Loss)	19,124	18,062
Roll Covers
Segment Earnings (Loss):
Segment Earnings (Loss)	7,836	14,070
Corporate
Segment Earnings (Loss):
Segment Earnings (Loss)	$ (1,258)	$ (2,989)

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Derivatives and Hedging (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014 Not Designated as Hedging Instrument Foreign Exchange Contract	Dec. 31, 2013 Not Designated as Hedging Instrument Foreign Exchange Contract
Derivative [Line Items]
Derivatives fair value of other assets (liabilities)			$ (935)	$ 530
Fair value contracts included in foreign exchange gain (loss)	$ (1,211)	$ 103

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Stock-Based Compensation and Stockholders' Deficit (Tables)

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation Expense

The Company recorded stock-based compensation expense during the three months ended March 31, 2014 and March 31, 2013 as follows:

	Three Months Ended March 31,
	2014		2013
RSU, Options and DSU Awards (1)	$	509	$	295

(1) Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors.

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Supplemental Guarantor Financial Information - Consolidating Statement Of Operation and Comprehensive (Loss) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Schedule of Condensed Consolidating Statement of Operations [Line Items]
Net Sales	$ 133,384	$ 139,805
Costs and expenses:
Cost of products sold	81,218	85,298
Selling	18,178	19,221
General and administrative	14,797	14,634
Research and development	1,946	1,954
Restructuring and impairments expense	4,651	1,255
Operating Costs and Expenses, Total	120,790	122,362
(Loss) Income from operations	12,594	17,443
Interest (expense) income, net	(8,657)	(9,206)
Foreign exchange loss	(877)	(249)
Income before provision for income taxes	3,060	7,988
Provision for income taxes	(1,893)	(2,503)
Net income	1,167	5,485
Comprehensive (loss) income	(758)	2,727
Parent
Costs and expenses:
Cost of products sold	(419)	(450)
Selling	113
General and administrative	1,884	1,982
Research and development	276	0
Restructuring and impairments expense	(18)	119
Operating Costs and Expenses, Total	1,836	1,651
(Loss) Income from operations	(1,836)	(1,651)
Interest (expense) income, net	(8,242)	(6,704)
Foreign exchange loss	(12)	183
Equity in subsidiaries income (deficit)	11,731	13,704
Income before provision for income taxes	1,641	5,532
Provision for income taxes	(474)	(47)
Net income	1,167	5,485
Comprehensive (loss) income	1,578	5,254
Total Guarantors
Schedule of Condensed Consolidating Statement of Operations [Line Items]
Net Sales	43,156	46,115
Costs and expenses:
Cost of products sold	29,999	30,863
Selling	5,068	5,871
General and administrative	2,520	807
Research and development	1,118	1,359
Restructuring and impairments expense	237	238
Operating Costs and Expenses, Total	38,942	39,138
(Loss) Income from operations	4,214	6,977
Interest (expense) income, net	1,395	1,406
Foreign exchange loss	(81)	(13)
Equity in subsidiaries income (deficit)	5,892	4,754
Dividend income		1,555
Income before provision for income taxes	11,420	14,679
Provision for income taxes	(34)	106
Net income	11,386	14,785
Comprehensive (loss) income	11,116	14,562
Total Non-Guarantors
Schedule of Condensed Consolidating Statement of Operations [Line Items]
Net Sales	99,265	105,399
Costs and expenses:
Cost of products sold	60,731	66,594
Selling	12,997	13,350
General and administrative	10,393	11,845
Research and development	552	595
Restructuring and impairments expense	4,432	898
Operating Costs and Expenses, Total	89,105	93,282
(Loss) Income from operations	10,160	12,117
Interest (expense) income, net	(1,810)	(3,908)
Foreign exchange loss	(784)	(419)
Equity in subsidiaries income (deficit)	0
Income before provision for income taxes	7,566	7,790
Provision for income taxes	(1,385)	(2,562)
Net income	6,181	5,228
Comprehensive (loss) income	4,115	2,924
Other Eliminations
Schedule of Condensed Consolidating Statement of Operations [Line Items]
Net Sales	(9,037)	(11,709)
Costs and expenses:
Cost of products sold	(9,093)	(11,709)
Operating Costs and Expenses, Total	(9,093)	(11,709)
(Loss) Income from operations	56
Equity in subsidiaries income (deficit)	(17,623)	(18,458)
Dividend income		(1,555)
Income before provision for income taxes	(17,567)	(20,013)
Provision for income taxes	0
Net income	(17,567)	(20,013)
Comprehensive (loss) income	(17,567)	(20,013)
The Company
Schedule of Condensed Consolidating Statement of Operations [Line Items]
Net Sales	133,384	139,805
Costs and expenses:
Cost of products sold	81,218	85,298
Selling	18,178	19,221
General and administrative	14,797	14,634
Research and development	1,946	1,954
Restructuring and impairments expense	4,651	1,255
Operating Costs and Expenses, Total	120,790	122,362
(Loss) Income from operations	12,594	17,443
Interest (expense) income, net	(8,657)	(9,206)
Foreign exchange loss	(877)	(249)
Income before provision for income taxes	3,060	7,988
Provision for income taxes	(1,893)	(2,503)
Net income	1,167	5,485
Comprehensive (loss) income	$ (758)	$ 2,727

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Restructuring and Impairment Expense - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Restructuring and Related Activities [Abstract]
Restructuring	$ 4,651	$ 1,255

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Long-term Debt - Additional Information (Detail) (USD $)	0 Months Ended	3 Months Ended			3 Months Ended				0 Months Ended	3 Months Ended	12 Months Ended		3 Months Ended											0 Months Ended	3 Months Ended		0 Months Ended							0 Months Ended		3 Months Ended	12 Months Ended		3 Months Ended
	May 17, 2013	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 Letter of Credit [Member]	Mar. 31, 2014 Less than 50 percent	Mar. 31, 2014 More than 50 percent	Mar. 31, 2014 Minimum More than 50 percent	Mar. 31, 2014 Maximum Less than 50 percent	Mar. 03, 2014 Revolving Credit Facility [Member]	Mar. 31, 2014 Revolving Credit Facility [Member]	Dec. 31, 2013 Revolving Credit Facility [Member]	May 17, 2013 Revolving Credit Facility [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Base Rate [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] London Interbank Offered Rate (LIBOR) [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Less than 33.3 percent Base Rate [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Less than 33.3 percent Canadian Dealer Offered Rate (CDOR) [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Less than 33.3 percent London Interbank Offered Rate (LIBOR) [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Between 33.3 percent and 66.7 percent Base Rate [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Between 33.3 percent and 66.7 percent London Interbank Offered Rate (LIBOR) [Member]	Mar. 31, 2014 Revolving Credit Facility [Member] Minimum Between 33.3 percent and 66.7 percent	Mar. 31, 2014 Revolving Credit Facility [Member] Minimum More than 66.7 percent	Mar. 31, 2014 Revolving Credit Facility [Member] Maximum Less than 33.3 percent	Mar. 31, 2014 Revolving Credit Facility [Member] Maximum Between 33.3 percent and 66.7 percent	Mar. 03, 2014 European Revolving Credit Facility [Member]	Mar. 31, 2014 European Revolving Credit Facility [Member] Less than 33.3 percent London Interbank Offered Rate (LIBOR) [Member]	Mar. 31, 2014 European Revolving Credit Facility [Member] Less than 33.3 percent Overnight London Interbank Offered Rate (LIBOR) [Member]	Mar. 03, 2014 European Revolving Credit Facility [Member] Between 33.3 percent and 66.7 percent London Interbank Offered Rate (LIBOR) [Member]	Mar. 03, 2014 European Revolving Credit Facility [Member] More than 66.7 percent London Interbank Offered Rate (LIBOR) [Member]	Mar. 03, 2014 European Revolving Credit Facility [Member] Minimum Between 33.3 percent and 66.7 percent	Mar. 03, 2014 European Revolving Credit Facility [Member] Minimum More than 66.7 percent	Mar. 03, 2014 European Revolving Credit Facility [Member] Maximum Between 33.3 percent and 66.7 percent	Mar. 31, 2014 Letter of Credit [Member]	Mar. 03, 2014 Letter of Credit [Member]	May 17, 2013 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member]	Dec. 31, 2013 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member]	May 17, 2013 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member] Base Rate [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member] London Interbank Offered Rate (LIBOR) [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member] Below Threshold [Member] Base Rate [Member]	Mar. 31, 2014 Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member] Term Loan [Member] Below Threshold [Member] London Interbank Offered Rate (LIBOR) [Member]	May 17, 2013 Eight Point Eight Seven Five Percentage Of Senior Unsecured Notes Due On Two Thousand Eighteen [Member]	Mar. 31, 2014 New Term Loan Debt Payable Quarterly Us Dollar Denominated London Interbank Offer Rate Six Point Two Five Percentage As Of June Thirty Two Thousand Thirteen [Member] Term Loan [Member]	Mar. 31, 2014 Senior Notes Unsecured Payable Semi Annually Us Dollar Denominated Interest Rate Fixed At Eight Point Eight Seven Five Percentage Matures June Of Two Thousand Eighteen	Dec. 31, 2013 Senior Notes Unsecured Payable Semi Annually Us Dollar Denominated Interest Rate Fixed At Eight Point Eight Seven Five Percentage Matures June Of Two Thousand Eighteen	Mar. 31, 2014 New Term Credity Facility and Notes [Member]	Mar. 31, 2014 New Credit Facility [Member]	Mar. 31, 2014 Senior Secured Revolving Credit Facility [Member]
Debt Disclosure [Line Items]
Debt Instrument, Term									5 years																									6 years
Debt Instrument, Face Amount																																						$ 200,000,000
Debt discount																																			900,000			1,000,000						900,000
Line of Credit Facility, Amount Outstanding				12,400,000																																													49,900,000
Line of Credit Facility, Current Borrowing Capacity									55,000,000	40,000,000		40,000,000.0												15,000,000								20,000,000	10,000,000
Debt Instrument, Accordion Option, Tranche Amount																																						75,000,000
Debt Instrument, Accordion Option, Senior Secured Leverage Ratio Threshold	2.25
Debt Instrument, Collateral, Outstanding Letters of Credit Threshold										20,000,000														10,000,000
Debt Instrument, Basis Spread on Variable Rate													1.25%	2.25%	0.75%	1.75%	1.75%	1.00%	2.00%						1.75%	1.75%	2.00%	2.25%											4.00%	5.00%	3.50%	4.50%
Debt Instrument, Interest Rate, Effective Percentage Rate Range, Minimum																																							2.25%	1.25%
Debt Instrument, Basis Spread on Variable Rate, Senior Secured Leverage Ratio Threshold																																				2.00
Debt Instrument, Basis Spread on Variable Rate, Asset-Based Lending Percentage Threshold																				33.30%	66.70%	33.30%	66.70%						33.30%	66.70%	66.70%
Line of Credit Facility, Remaining Borrowing Capacity		5,100,000																																														37,500,000
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage					0.50%	0.375%
Debt Instrument, Unused Capacity, Commitment Fee Percentage, Asset-Based Lending Percentage Threshold							50.00%	50.00%
Percentage Of Voting Capital Sock Required To Be Pledged In Respect Of Obligations Under A Debt Agreement		65.00%
Debt Instrument, Covenant Compliance, Maximum Annual Capital Expenditures											42,000,000
Debt Instrument, Covenant Compliance, Minimum Fixed Charge Coverage Ratio											1.00
Refinancing transaction, outstanding indebtedness																																											240,000,000		236,410,000	236,410,000
Debt instrument percentage																																			5.70%								8.875%
Long-term debt, net of current maturities		433,771,000	432,706,000
Carrying value of long-term debt		435,975,000	434,872,000																																												434,000,000
Fair value of long-term debt		455,000,000	451,600,000
Line of Credit Facility, Increase in Borrowing Capacity									10,000,000
Line of Credit Facility, Maximum Borrowing Capacity									65,000,000
Line of Credit Facility, Maximum Borrowing Capacity, Requiring Additional Indebtedness and Liens to be Reduced									55,000,000
Debt Instrument, Amortization Payments, Quarterly, Percentage of Principal Per Annum																																					1.00%
Debt Instrument, Prepayment Premium																																					1.00%
Line of Credit Facility, Repayment Requirement on Excess Borrowing, Advances Outstanding										40,000,000														15,000,000
Liabilities under capital leases		$ 4,324,000	$ 0

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Stock-Based Compensation and Stockholders' Deficit - Stock-Based Compensation Expense (Detail) (RSU, Options and DSU Awards [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014		Mar. 31, 2013
RSU, Options and DSU Awards [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Stock-based compensation expense	$ 509	[1]	$ 295	[1]

[1] Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors.

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Income Taxes

3 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company utilizes the asset and liability method for accounting for income taxes in accordance with ASC Topic 740, Income Taxes (“Topic 740”). Under Topic 740, deferred tax assets and liabilities are determined based on the difference between their financial reporting and tax basis. The assets and liabilities are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company reduces its deferred tax assets by a valuation allowance if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In making this determination, the Company evaluates all available information including the Company’s financial position and results of operations for the current and preceding years, as well as any available projected information for future years.

For the three months ended March 31, 2014, the provision for income taxes was $1,893 as compared to $2,503 for the three months ended March 31, 2013. The decrease in tax expense was primarily attributable to the geographic mix of earnings for those periods in the three months ended March 31, 2014. The provision for income taxes is primarily impacted by income earned in tax paying jurisdictions relative to income earned in non-tax paying jurisdictions. The majority of income recognized for purposes of computing the effective tax rate is earned in countries where the statutory income tax rates range from 15% to 39.43%; however, permanent income adjustments recorded against pre-tax earnings may result in an effective tax rate that is higher or lower than the statutory tax rate in these jurisdictions. The Company generates losses in certain jurisdictions for which no tax benefit is received, as the deferred tax assets in these jurisdictions (including the net operating losses) are fully reserved in the valuation allowance. For this reason, the Company recognizes minimal income tax expense or benefit in these jurisdictions, of which the most material jurisdictions are the United States, the United Kingdom and Australia. Due to these reserves, the geographic mix of the Company’s pre-tax earnings has a direct correlation with how high or low its annual effective tax rate is relative to consolidated earnings. As the Company continues to reorganize and restructure its operations, it is possible that deferred tax assets, for which no income tax benefit has previously been provided, may more likely than not become realized. The Company continues to evaluate future operations and will record an income tax benefit in the period where it believes it is more likely than not that the deferred tax asset will be able to be realized.

As of March 31, 2014, the Company had a gross amount of unrecognized tax benefit of $7,919, exclusive of interest and penalties. The unrecognized tax benefit increased by approximately $428 during the three months ended March 31, 2014, as a result of foreign currency effects, statute expirations, and ongoing changes in currently reserved positions as a result of new facts or information. The Company’s policy is to recognize interest and penalties related to income tax matters as income tax expense, which were immaterial for the three months ended March 31, 2014 and 2013. The tax years 2000 through 2013 remain open to examination in a number of the major tax jurisdictions to which the Company and its subsidiaries are subject. The Company believes that it has made adequate provisions for all income tax uncertainties.

In July of 2013, FASB issued ASU 2013-11 Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Taskforce) ("ASU 2013-11"). Beginning January 1, 2014, the effective date of this regulation, the Company has adopted the provisions of ASU 2013-11 related to presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  The effect on the date of adoption resulted in a decrease in other long term liabilities and a decrease in other assets of $1,147 related to uncertain tax benefits for Canada, Germany, and Italy.

In November of 2011, the Federal Revenue Department of the Ministry of Finance of (“FRD”) issued a tax assessment against the Company’s indirect subsidiary, Xerium Technologies Brasil Indústria e Comércio S.A. (“Xerium Brazil”), challenging the goodwill recorded in the 2005 acquisition of Wangner Itelpa and Huyck Indústria e Comércio S.A. by Robec Brasil Participações Ltda., a predecessor to Xerium Brazil. This assessment denied the amortization of that goodwill against net income for the years 2006 through 2010 and sought payment of approximately $41,086 (subject to currency exchange rates) in tax, penalties and interest as of March 31, 2014. The Company believes the transactions in question (i) complied with Brazilian tax and accounting rules, (ii) were effected for a legitimate business purpose, to consolidate the Company’s operating activities in Brazil into one legal entity, and (iii) were properly documented and declared to Brazilian tax and corporate authorities. Based on the foregoing, Xerium Brazil filed a response disputing the tax assessment. In December of 2012 an administrative panel at the first administrative appeals level within the FRD rendered a decision upholding the original assessment, but reducing the claimed penalties by 50%. This decision reduced the total assessed amount as of March 31, 2014 by approximately $11,102 to $29,984 (subject to currency exchange rates). On January 18, 2013, Xerium Brazil appealed the decision of the first administrative panel to the second of three administrative appeals courts potentially available to it within the FRD.

Although there can be no assurances, as of March 31, 2014, the Company believes it is more likely than not that it would prevail on every tax position under examination and therefore it did not accrue any amounts related to this assessment. The Company cannot assure a favorable outcome and cannot currently estimate the timing of the final resolution of this matter. The Company believes it has meritorious defenses and will vigorously contest this matter, and if the administrative courts of the FRD do not rule in the Company's favor, the Company intends to appeal its case to the Brazilian judicial courts. However, if management's views of the Company's position and the probable outcome of the assessment changes or the FRD’s initial position is sustained by Brazilian judicial courts, the amount accrued would adversely impact the Company’s financial condition and results of operations in the period in which any such determination or decision is made.

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Restructuring and Impairment Expense - Restructuring Programs (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Restructuring Reserve
Beginning Balance	$ 7,934	$ 15,912
Charges	4,651	1,185
Currency Effects	(57)	(461)
Cash Payments	(2,552)	(4,679)
Ending Balance	9,976	11,957
Idle facility asset impairment	0	857
Severance [Member]
Restructuring Reserve
Beginning Balance	6,466	15,577
Charges	4,411	775
Currency Effects	(46)	(451)
Cash Payments	(2,240)	(4,109)
Ending Balance	8,591	11,792
Facility Costs And Other [Member]
Restructuring Reserve
Beginning Balance	1,468	335
Charges	240	410
Currency Effects	(11)	(10)
Cash Payments	(312)	(570)
Ending Balance	1,385	165
Facility Closing and Employee Severance [Member]
Restructuring Reserve
Idle facility asset impairment		$ 70

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Description of Business and Significant Accounting Policies - Changes In Warranty Liability (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Warranties, Increase (Decrease)
Beginning balance	$ 1,629
Charged to Cost of Sales	327
Effect of Foreign Currency Translation	(5)
Deduction from Reserves	(422)
Ending balance	$ 1,529

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Description of Business and Significant Accounting Policies - Components of Inventories (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Consigned inventory	$ 8,815	$ 8,697

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Restructuring and Impairment Expense - By Segment (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Restructuring Cost and Reserve [Line Items]
Restructuring and impairments expense	$ 4,651	$ 1,255
Clothing
Restructuring Cost and Reserve [Line Items]
Restructuring and impairments expense	2,254	409
Roll Covers
Restructuring Cost and Reserve [Line Items]
Restructuring and impairments expense	2,397	727
Corporate
Restructuring Cost and Reserve [Line Items]
Restructuring and impairments expense	$ 0	$ 119

XML

Description of Business and Significant Accounting Policies - Net Income (Loss) Per Common Share (Detail)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Weighted-average common shares outstanding–basic	15,391,391	15,312,523
Dilutive effect of stock-based compensation awards outstanding	980,381	68,681
Weighted-average common shares outstanding–diluted	16,371,772	15,381,204

XML

Description of Business and Significant Accounting Policies - Anti-dilutive Shares (Detail) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Dilutive securities outstanding, not included in the computation	1.7	2.5

XML

Long-term Debt

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

Long-term Debt

Long-term Debt

At March 31, 2014 and December 31, 2013, long-term debt consisted of the following:

	March 31, 2014		December 31, 2013
Senior secured term loan facility, payable quarterly, U.S. Dollar denominated–LIBOR (minimum 1.25%) plus 4.50% (5.75%) net of $0.9 million discount. Matures May of 2018.	$	197,639	$	198,000
Senior Notes (Unsecured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 8.875%, matures June of 2018	236,410		236,410
Other long term debt	1,926		462
	435,975		434,872
Less current maturities	2,204		2,166
Total	$	433,771	$	432,706

On May 17, 2013 (the "Closing Date"), the Company entered into a Credit and Guaranty Agreement for a $200.0 million term loan credit facility (the “Term Credit Facility”), net of a discount of $1.0 million, among the Company, certain direct and indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions. The Company also entered into a Revolving Credit and Guaranty Agreement originally for a $40.0 million asset-based revolving credit facility subject to a borrowing base among the Company, Xerium Canada Inc., as Canadian borrower, certain direct and indirect U.S. subsidiaries of the Company as guarantors and certain financial institutions (the "Domestic Revolver"). On March 3, 2014, the Company entered into an amendment to the Revolving Credit and Guaranty Agreement (as amended, the “ABL Facility,” and collectively with the Term Credit Facility, the “Credit Facility”) to add the Company's German subsidiaries as European Borrowers and to provide for an additional $15 million European asset-based revolving credit facility subject to a European borrowing base (the "European Revolver"), increasing the aggregate availability under the ABL Facility to $55 million.

The Term Credit Facility provides for:

• a six-year $200 million senior secured term loan facility, provided the facility would mature in March 2018 if any of the Company's 8.875% senior unsecured notes due 2018 in the aggregate principal amount of $240 million (the “Notes”) remain outstanding at that time;

• an uncommitted accordion option (the “Incremental Facility”) allowing for increases for borrowings under the Term Credit Facility with the same terms, and borrowing of new tranches of term loans, up to an aggregate principal amount equal to (i) $75 million plus (ii) an additional amount (the “Facility Increase”) provided, if after giving effect to such Facility Increase (as well as any other additional term loans), on a pro forma basis, the Senior Secured Leverage Ratio (as defined in the Term Credit Facility) for the most recent four consecutive fiscal quarters does not exceed 2.25:1; and

• in connection with the amendment to the ABL Facility, the Term Credit Facility was amended to permit the ABL Facility to be further increased by an additional $10 million, to a total aggregate availability of not more than $65 million, provided that if the ABL Facility is increased beyond $55 million, certain baskets for additional indebtedness and liens otherwise available to the Company under the Term Loan Facility will be reduced dollar-for-dollar by any additional increase to the ABL Facility.

The Domestic Revolver provides for a $40 million senior secured revolving credit facility with a $20 million sub-limit on letters of credit. The European Revolver provides for a $15 million senior secured revolving credit facility with a $10 million sub-limit on letters of credit. Availability under both the Domestic Revolver and the European Revolver is subject to a borrowing base that is based on a specified percentage of eligible accounts receivable and inventory. The term of the ABL Facility is five years, provided that if any of the Notes remain outstanding in March 2018, the ABL Facility would mature at that time.

The Company used the borrowings under the Term Credit Facility to refinance all of its outstanding indebtedness under its previously existing senior secured term loan and revolving credit facility entered into in 2011 (the "2011 Credit Facility"). The Company intends to draw upon the ABL Facility from time-to-time for working capital and general corporate purposes.

The Term Credit Facility will require the Company to make amortization payments (payable in quarterly installments) equal to 1% of principal per annum with respect to the Term Credit Facility with the remaining amount due at final maturity. Voluntary prepayments will be permitted, in whole or in part, subject to minimum prepayment requirements; provided that prepayments made prior to the date that is six months after the Closing Date of the Term Credit Facility for the purpose of repricing or effectively repricing the term loan facilities must include a 1.0% prepayment premium; provided, further, that voluntary prepayments of loans bearing interest at the London Interbank Offered Rate (“LIBOR”) on a date other than the last day of the relevant interest period will be subject to the payment of customary breakage costs.

If the total amount of advances outstanding under the ABL Facility exceeds either $40 million or the borrowing base, the Company must repay an amount equal to the excess borrowing. If obligations under all outstanding letters of credit exceeds $20 million, the Company must cash collateralize its letters of credit in an amount equal to the excess obligations outstanding. Similarly, if the total amount of advances outstanding under the European Revolver exceed either $15 million or the European

borrowing base, the Company must repay an amount equal to the excess borrowing. If obligations under all outstanding

European-based letters of credit exceeds $10 million, the Company must cash collateralize its letters of credit in an amount

equal to the excess obligations outstanding.

The interest rates under the Term Credit Facility will be calculated, at the Company's option, at either the base rate or LIBOR, plus a margin of 4.00% and 5.00%, respectively. Each of the base rate and LIBOR shall be subject to a minimum of 2.25% and 1.25%, respectively. If the Company's Senior Secured Leverage Ratio (as defined in the Credit Facility) is less than 2.00:1 at any quarterly determination date, then the margins over the base rate and LIBOR will be 3.50% and 4.50%, respectively.

Depending on whether advances are made in U.S. Dollars or Canadian Dollars, interest rates under the Domestic Revolver will be calculated, at our option, at either a U.S.-based or Canadian-based base rate ("Base Rate Loans") or LIBOR or the Canadian Dealer Offered Rate ("CDOR") (each, "Fixed Rate Loans"), respectively, plus a margin of 0.75% for Base Rate Loans and a margin of 1.75% for Fixed Rate Loans. If we draw advances on the Domestic Revolver that are equal to or greater than 33.3% but less 66.7% of the $40 million limit, then the margins on Base Rate Loans and Fixed Rate Loans increase to 1.00% and 2.00%, respectively. The margins rise to 1.25% and 2.25%, respectively, if advances under the Domestic Revolver are equal to or greater than 66.7% of the $40 million limit. Interest rates under the European Revolver will be calculated, at either LIBOR or Overnight LIBOR, plus a margin of 1.75%. If the European Borrowers draw advances on the European Revolver that are equal to or greater than 33.3% but less than 66.7% of the $15 million limit, then the margin increases to 2.00%. The margin rises to 2.25% if advances under the European Revolver are equal to or greater than 66.7% of the $15 million limit. In addition to paying interest on outstanding advances under the ABL Facility, we will be required to pay a commitment fee to the lenders in respect of the unutilized commitments at a rate equal to 0.50% per annum if advances under the ABL Facility are less than or equal to 50% of the commitments or a rate equal to 0.375% per annum if advances under the ABL are more than 50% of the commitments.

The obligations under the Credit Facility are guaranteed by all of our existing and future direct and indirect subsidiaries that are organized in the United States (subject to certain exceptions in the case of immaterial subsidiaries and joint ventures) and, (i) in the case of the Domestic Revolver, by Xerium Canada Inc. and any future Canadian subsidiaries, provided that non-U.S. guarantors will only be liable for obligations of Xerium Canada Inc. and any other Canadian borrowers and (ii) in the case of the European Revolver, by each other European Borrower, certain other of the Company’s European subsidiaries and any existing or future direct and indirect subsidiaries that become a party to the ABL Facility. The Term Credit Facility is secured by a first-priority perfected security interest in substantially all of the assets of the Company, Xerium Canada Inc. and such subsidiary guarantors (collectively, the “Loan Parties”), in each case, now owned or later acquired, except with respect to the Loan Parties' accounts receivables and inventory, which are secured by a second-priority interest. The ABL Facility is secured by a first-priority perfected security interest in the Loan Parties' accounts receivables and inventory, and a second-priority interest in substantially all of the Loan Parties' other assets. In each case, the security interests are subject to certain exceptions and legal and tax considerations and requirements, including that only 65% of the voting capital stock of the domestic Loan Parties' “first-tier” non-U.S. subsidiaries is required to be pledged in respect of the obligations of the Company and the U.S. guarantors under the Credit Facility.

The Credit Facility contains certain customary covenants that, subject to exceptions, restrict the Company's ability to, among other things:

•declare dividends or redeem or repurchase equity interests;

•prepay, redeem or purchase debt;

•incur liens and engage in sale-leaseback transactions;

•make loans and investments;

•incur additional indebtedness;

•amend or otherwise alter debt and other material agreements;

•make capital expenditures in excess of $42 million per fiscal year, subject to adjustment;

•engage in mergers, acquisitions and asset sales;

•transact with affiliates; and

•engage in businesses that are not related to the Company's existing business.

The Credit Facility eliminates the interest coverage and leverage coverage ratio maintenance tests that were contained in the Company's 2011 Credit Facility. However, the ABL Facility contains a springing Fixed Charge Coverage Ratio (as defined in the ABL Facility), which must be not less than 1.00:1 during periods in which our Global Excess Availability (as defined in the ABL Facility) falls below certain minimum thresholds.

The Credit Facility contains certain customary representations and warranties, affirmative covenants and events of default, including payment defaults, breaches of representations and warranties, covenant defaults, cross-defaults and cross-acceleration to certain indebtedness, certain events of bankruptcy, certain triggering events under U.S. and, in the case of the ABL Facility, Canadian employee benefit plans, material judgments, actual or asserted failures of any guarantee or security document supporting the Credit Facility to be in full force and effect and a change of control. If an event of default occurs, the lenders under the Credit Facility would be entitled to take various enforcement actions, including acceleration of amounts due under the Credit Facility and all actions permitted to be taken by a secured creditor.

On May 26, 2011, the Company completed a refinancing transaction, which replaced certain of its then outstanding indebtedness with the Notes. The Notes contain customary covenants that, subject to certain exceptions, restrict its ability to enter into certain transactions and engage in certain activities. The Company has $236.4 million aggregate principal amount outstanding under the Notes. The Notes contain customary covenants that, subject to certain exceptions, restrict its ability to enter into certain transactions and engage in certain activities.

As of March 31, 2014, the outstanding balance of the Company's term debt under its Credit Facility and Notes was $434.0 million, which is net of a $0.9 million discount. In addition, as of March 31 2014, an aggregate of $37.5 million is available for additional borrowings under the ABL Facility. This availability represents a borrowing base of $49.9 million under the ABL Facility less $12.4 million of that facility committed for letters of credit or additional borrowings. Additionally, at March 31, 2014, the Company had approximately $5.1 million available for borrowings under other small lines of credit.

As of March 31, 2014 and December 31, 2013, the carrying value of the Company’s long-term debt was $436.0 million and $434.9 million, respectively, and its fair value was approximately $455.0 million and $451.6 million, respectively. The Company determined the fair value of its debt utilizing significant other observable inputs (Level 2 of the fair value hierarchy).

Capitalized Lease Liabilities

As of March 31, 2014, the Company had capitalized lease liabilities totaling $4.3 million. These amounts represent the lease on the corporate headquarters and a software licensing agreement.

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Description of Business and Significant Accounting Policies - Additional Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Income Tax Contingency [Line Items]
Selling expenses	$ 18,178	$ 19,221
Other long-term liabilities	4,747		5,570
Other assets	10,106		9,483
Restatement Adjustment [Member]
Income Tax Contingency [Line Items]
Selling expenses	700
Accounting Standards Update 2013-11 [Member] | Restatement Adjustment [Member]
Income Tax Contingency [Line Items]
Other long-term liabilities	1,147
Other assets	$ 1,147

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Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss - Components Of Comprehensive Income (Loss) (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Equity [Abstract]
Comprehensive income (loss), tax	$ 0	$ 0
Comprehensive Income (Loss) And Accumulated Other Comprehensive Income (Loss) [Abstract]
Net income	1,167,000	5,485,000
Foreign currency translation adjustments	(1,669,000)	(4,392,000)
Pension liability changes under Topic 715	(275,000)	1,602,000
Change in value of derivative instruments	19,000	32,000
Comprehensive (loss) income	$ (758,000)	$ 2,727,000

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 18,013	$ 25,716
Accounts receivable, net	94,620	87,952
Inventories, net	88,295	83,930
Prepaid expenses	6,573	8,179
Other current assets	14,402	15,695
Total current assets	221,903	221,472
Property and equipment, net	316,853	309,664
Goodwill	67,936	68,975
Intangible assets	14,265	14,470
Other assets	10,106	9,483
Total assets	631,063	624,064
Current liabilities:
Notes payable	8,243	8,267
Accounts payable	37,873	42,220
Accrued expenses	69,138	61,368
Current maturities of long-term debt	2,204	2,166
Total current liabilities	117,458	114,021
Long-term debt, net of current maturities	433,771	432,706
Liabilities under capital leases	4,324	0
Deferred taxes	15,789	16,350
Pension, other post-retirement and post-employment obligations	66,727	66,866
Other long-term liabilities	4,747	5,570
Commitments and contingencies (Note 9)
Stockholders’ deficit
Preferred stock, $0.001 par value, 1,000,000 shares authorized; no shares outstanding as of March 31, 2014 and December 31, 2013	0	0
Common stock, $0.001 par value, 20,000,000 shares authorized; 15,410,122 and 15,383,903 shares outstanding as of March 31, 2014 and December 31, 2013, respectively	15	15
Stock warrants	13,532	13,532
Paid-in capital	415,194	414,742
Accumulated deficit	(408,519)	(409,686)
Accumulated other comprehensive loss	(31,975)	(30,052)
Total stockholders’ deficit	(11,753)	(11,449)
Total liabilities and stockholders’ deficit	$ 631,063	$ 624,064

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Summarized Financial Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Segment Reporting Information [Line Items]
Net Sales	$ 133,384	$ 139,805
Segment Earnings (Loss)	12,594	17,443
Clothing
Segment Reporting Information [Line Items]
Net Sales	88,971	89,937
Segment Earnings (Loss)	19,124	18,062
Roll Covers
Segment Reporting Information [Line Items]
Net Sales	44,413	49,868
Segment Earnings (Loss)	7,836	14,070
Corporate
Segment Reporting Information [Line Items]
Segment Earnings (Loss)	$ (1,258)	$ (2,989)

XML

Description of Business and Significant Accounting Policies

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Significant Accounting Policies

Description of Business and Significant Accounting Policies

Description of Business

Xerium Technologies, Inc. (the "Company") is a leading global provider of industrial consumables and mechanical services used in the production of paper, paperboard, building products and nonwoven materials. Its operations are strategically located in the major paper-making regions of the world, including North America, Europe, South America and Asia-Pacific.

Basis of Presentation

The accompanying unaudited condensed consolidated interim financial statements at March 31, 2014 and for the three months ended March 31, 2014 and 2013 include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, such financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. GAAP requires the Company’s management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. The interim results presented herein are not necessarily indicative of the results to be expected for the entire year. In management’s opinion, these unaudited condensed consolidated interim financial statements contain all adjustments of a normal recurring nature necessary for a fair presentation of the financial statements for the interim periods presented.These unaudited consolidated interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2013 as reported on the Company's Annual Report on Form 10-K filed on March 4, 2014.

Accounting Policies

Inventories, net

Inventories are generally valued at the lower of cost or market using the first-in, first-out (FIFO) method. Raw materials are valued principally on a weighted average cost basis. The Company’s work in process and finished goods are specifically identified and valued based on actual inputs to production. Provisions are recorded as appropriate to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires management to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business, while considering the general aging of inventory and factoring in any new business conditions.

The components of inventories are as follows at:

	March 31, 2014			December 31, 2013
Raw materials	$	22,708		$	22,009
Work in process	31,907			28,414
Finished goods (includes consigned inventory of $8,815 at March 31, 2014 and $8,697 at December 31, 2013)	42,047			41,845
Inventory allowances	(8,367		)	(8,338		)
	$	88,295		$	83,930

Goodwill

The Company accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other Intangible Assets (“Topic 350”). Topic 350 requires that goodwill and intangible assets that have indefinite lives not be amortized, but instead, must be tested for impairment at least annually or whenever events or business conditions warrant. During the first quarter of 2014, the Company evaluated events and business conditions to determine if a test for an impairment of goodwill was warranted. No such events or business conditions took place during this period, therefore no test was determined to be warranted at March 31, 2014.

Warranties

The Company offers warranties on certain rolls products that it sells. The specific terms and conditions of these warranties vary depending on the product sold, the country in which the product is sold and arrangements with the customer. The Company estimates the costs that may be incurred under its warranties and records a liability for such costs. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company periodically assesses the adequacy of its recorded warranty claims and adjusts the amounts as necessary. The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2014:

Beginning Balance		Charged to  Cost of Sales		Effect of Foreign Currency Translation			Deduction from Reserves			Ending Balance
$	1,629	$	327	$	(5	)	$	(422	)	$	1,529

Net Income Per Common Share

Net income per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net income per share is based on the weighted-average number of shares outstanding during the period. As of March 31, 2014 and 2013, the Company had outstanding restricted stock units (“RSUs”), deferred stock units (“DSUs”), warrants and options.

The following table sets forth the computation of basic and diluted weighted-average shares:

	Three Months Ended March 31,
	2014	2013
Weighted-average common shares outstanding–basic	15,391,391	15,312,523
Dilutive effect of stock-based compensation awards outstanding	980,381	68,681
Weighted-average common shares outstanding–diluted	16,371,772	15,381,204

Dilutive securities aggregating approximately 1.7 million and 2.5 million were outstanding for the three months ended March 31, 2014 and 2013, but were not included in the computation of diluted earnings per share for the three months ended March 31, 2014 because the impact of including such shares would be anti-dilutive to the earnings per share calculations.

Impairment

The Company reviews its long-lived assets that have finite lives for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment (“Topic 360”). This topic requires that companies evaluate the fair value of long-lived assets based on the anticipated undiscounted future cash flows to be generated by the assets when indicators of impairment exist to determine if there is impairment to the carrying value. Any change in the carrying amount of an asset as a result of the Company's evaluation has been recorded in either restructuring expense, if it was a result of the Company's restructuring activities, or general and administrative expense for all other impairments in the consolidated statements of operations. Impairment charges associated with restructuring are discussed in Note 7 "Restructuring Expense". In the first quarter of 2014, the Company had no impairment charges.

Reclassifications

During the first quarter of 2014, while implementing a new financial reporting system, the Company redesigned its chart of accounts in order to provide more consistent internal and external reporting globally. In addition to this change, the Company's corporate management organizational structure was changed from primarily a geographic regional management organization to a more centralized functional management organization. These changes drove certain changes in the mappings of the related accounts in the chart of accounts. As these changes are correctly presented in the 2014 consolidated financial statements, these changes resulted in reclassifications in both the Consolidated Balance Sheet at December 31, 2013 and the Consolidated Statement of Operations for the three months ended March 31, 2013. Management performed a SAB 99 "Materiality" analysis on these reclassifications, and determined the only reclassification material to the Company's consolidated financial statements as a whole was a $0.7 million reclassification from research and development expenses to selling expenses as a result of moving certain personnel from the research and development department to the selling department. This reclassification has been made in the Consolidated Statement of Operations for the three months ended March 31, 2013.

New Accounting Standards

In July of 2013, FASB issued ASU 2013-11 Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Taskforce) ("ASU 2013-11"). Beginning January 1, 2014, the effective date of this regulation, the Company has adopted the provisions of ASU 2013-11 related to presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists.  The effect on the date of adoption resulted in a decrease in other long term liabilities and a decrease in other assets of $1.1 million related to uncertain tax benefits for Canada, Germany, and Italy.

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Long-term Debt - Schedule Of Long-Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Other Long-Term Debt:
Other long term debt	$ 1,926	$ 462
Carrying value of long-term debt	435,975	434,872
Less current maturities	2,204	2,166
Total	433,771	432,706
Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member]
Senior Bank Debt (Secured):
Senior Bank Debt (Secured)	197,639	198,000
Senior Notes Unsecured Payable Semi Annually Us Dollar Denominated Interest Rate Fixed At Eight Point Eight Seven Five Percentage Matures June Of Two Thousand Eighteen
Senior Bank Debt (Secured):
Senior Notes (Unsecured), payable semi-annually-U.S. Dollar denominated interest rate fixed at 8.875%, matures June of 2018	$ 236,410	$ 236,410

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Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss (Tables)

3 Months Ended

Mar. 31, 2014

Equity [Abstract]

Components of Comprehensive Income (Loss)

Comprehensive (loss) income for the three months ended March 31, 2014 and 2013 is as follows (net of tax benefits of $32):

	Three Months Ended March 31,
	2014			2013
Net income	$	1,167		$	5,485
Foreign currency translation adjustments	(1,669		)	(4,392		)
Pension liability changes under Topic 715	(275		)	1,602
Change in value of derivative instruments	19			32
Comprehensive (loss) income	$	(758	)	$	2,727

Components of Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss for the three months ended March 31, 2014 are as follows (net of tax benefits of $5.1 million):

	Foreign Currency Translation     Adjustment			Pension Liability Changes Under  Topic 715			Change in Value of Derivative Instruments			Accumulated    Other Comprehensive (Loss) Income
Balance at December 31, 2013	$	(136	)	$	(29,681	)	$	(235	)	$	(30,052	)
Other comprehensive loss before reclassifications	(1,669		)	—			—			(1,669		)
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	—			(275		)	—			(275		)
Amortization of interest expense	—			—			21			21
Net current period other comprehensive (loss) income	(1,669		)	(275		)	21			(1,923		)
Balance at March 31, 2014	$	(1,805	)	$	(29,956	)	$	(214	)	$	(31,975	)

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Long-term Debt - Schedule Of Long-Term Debt (Parenthetical) (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Senior Secured Term Loan Facility, Payable Quarterly, US Dollar Denominated [Member]
Debt Disclosure [Line Items]
LIBOR rate, minimum	1.25%
Interest rate Percentage above LIBOR rate	4.50%
Debt instrument interest rate	5.70%
Debt discount	$ 0.9
Senior Notes Unsecured Payable Semi Annually Us Dollar Denominated Interest Rate Fixed At Eight Point Eight Seven Five Percentage Matures June Of Two Thousand Eighteen
Debt Disclosure [Line Items]
Debt instrument fixed interest rate	8.875%	8.875%
Debt instrument maturity	Jun. 01, 2018	Jun. 01, 2018

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Business Segment Information (Tables)

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Summarized Financial Information

Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2014 and 2013.

	Clothing		Roll Covers		Corporate			Total
Three Months Ended March 31, 2014:
Net Sales	$	88,971	$	44,413	$	—		$	133,384
Segment Earnings (Loss)	$	19,124	$	7,836	$	(1,258	)
Three Months Ended March 31, 2013:
Net Sales	$	89,937	$	49,868	$	—		$	139,805
Segment Earnings (Loss)	$	18,062	$	14,070	$	(2,989	)

Reconciliation of Segment Earnings (Loss) to Income Before Provision for Income Taxes

Provided below is a reconciliation of Segment earnings (loss) to income before provision for income taxes for the three months ended March 31, 2014 and 2013, respectively.

	Quarter Ended March 31,
	2014			2013
Segment Earnings (Loss):
Clothing	$	19,124		$	18,062
Roll Covers	7,836			14,070
Corporate	(1,258		)	(2,989		)
Stock-based compensation	(509		)	(295		)
Idle facility asset impairment	—			(857		)
Interest expense, net	(8,657		)	(9,206		)
Depreciation and amortization	(8,649		)	(9,542		)
Restructuring expense	(4,651		)	(1,255		)
Plant startup costs	(176		)	—
Income before provision for income taxes	$	3,060		$	7,988

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Derivatives and Hedging

3 Months Ended

Mar. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging

Derivatives and Hedging

As required by ASC Topic 815, Derivatives and Hedging (“Topic 815”), the Company records all derivatives on the balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether the Company has elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability or firm commitment attributable to a particular risk are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. Hedge accounting generally provides for the matching of the timing of gain or loss recognition on the hedging instrument with the recognition of the changes in the fair value of the hedged asset or liability that are attributable to the hedged risk in a fair value hedge or the earnings effect of the hedged forecasted transactions in a cash flow hedge.

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. From time to time, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known cash amounts, the value of which are determined by interest rates or foreign exchange rates.

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company uses interest rate caps as part of its interest rate risk management strategy. Interest rate caps designated as cash flow hedges protect the Company from increases in interest rates above the strike rate of the interest rate cap. At March 31, 2014, the fair market value of the Company’s interest rate swaps were nominal amounts. Therefore, the financial statements were not exposed to the effects of interest rate fluctuations and these did not have a material impact on its results of operations.

Non-designated Hedges of Foreign Exchange Risk

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to foreign exchange rates, but do not meet the strict hedge accounting requirements of Topic 815. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly to earnings.

The Company, from time to time, may enter into foreign exchange forward contracts to fix currencies at specified rates based on expected future cash flows to protect against the fluctuations in cash flows resulting from sales denominated in foreign currencies. Additionally, to manage its exposure to fluctuations in foreign currency on intercompany balances and certain purchase commitments, the Company from time to time may use foreign exchange forward contracts.

As of March 31, 2014 and December 31, 2013, the Company had outstanding derivatives that were not designated as hedges in qualifying hedging relationships. The value of these contracts is recognized at fair value based on market exchange forward rates and is recorded in other assets or other liabilities on the Consolidated Balance Sheets. The following represents the fair value of these derivatives at March 31, 2014 and December 31, 2013 and the change in fair value included in foreign exchange gain in the first quarter of 2014 and 2013:

	March 31, 2014			December 31, 2013
Fair value of derivatives	$	(935	)	$	530
	Three Months Ended March 31, 2014:			Three Months Ended March 31, 2013:
Change in fair value included in foreign exchange (loss) gain for the three months ended March 31, 2014 and March 31, 2013	$	(1,211	)	$	103

The following represents the notional amounts of foreign exchange forward contracts at March 31, 2014:

	Notional Sold		Notional Purchased
Non-designated hedges of foreign exchange risk	$	28,596	$	(22,259	)

Fair Value of Derivatives Under ASC Topic 820

ASC Topic 820, Fair Value Measurements and Disclosures (“Topic 820”), emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, Topic 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs including fair value of investments that do not have the ability to redeem at net asset value as of the measurement date, or during the first quarter following the measurement date. The derivative assets or liabilities are typically based on an entity’s own assumptions, as there is little, if any, market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and the Company considers factors specific to the asset or liability. The Company determined that its derivative valuations, which are based on market exchange forward rates, fall within Level 2 of the fair value hierarchy.

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Condensed Consolidated Balance Sheets (Parenthetical) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	20,000,000	20,000,000
Common stock, shares outstanding	15,410,122	15,383,903

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Description of Business and Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Inventories, net

Inventories, net

Inventories are generally valued at the lower of cost or market using the first-in, first-out (FIFO) method. Raw materials are valued principally on a weighted average cost basis. The Company’s work in process and finished goods are specifically identified and valued based on actual inputs to production. Provisions are recorded as appropriate to write-down obsolete and excess inventory to estimated net realizable value. The process for evaluating obsolete and excess inventory often requires management to make subjective judgments and estimates concerning future sales levels, quantities and prices at which such inventory will be able to be sold in the normal course of business, while considering the general aging of inventory and factoring in any new business conditions.

Goodwill

Goodwill

The Company accounts for goodwill and other intangible assets in accordance with ASC Topic 350, Intangibles—Goodwill and Other Intangible Assets (“Topic 350”). Topic 350 requires that goodwill and intangible assets that have indefinite lives not be amortized, but instead, must be tested for impairment at least annually or whenever events or business conditions warrant. During the first quarter of 2014, the Company evaluated events and business conditions to determine if a test for an impairment of goodwill was warranted. No such events or business conditions took place during this period, therefore no test was determined to be warranted at March 31, 2014.

Warranties

Warranties

The Company offers warranties on certain rolls products that it sells. The specific terms and conditions of these warranties vary depending on the product sold, the country in which the product is sold and arrangements with the customer. The Company estimates the costs that may be incurred under its warranties and records a liability for such costs. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim and new product introduction. The Company periodically assesses the adequacy of its recorded warranty claims and adjusts the amounts as necessary.

Net (Loss) Income Per Common Share

Net Income Per Common Share

Net income per common share has been computed and presented pursuant to the provisions of ASC Topic 260, Earnings per Share (“Topic 260”). Net income per share is based on the weighted-average number of shares outstanding during the period.

Impairment

Impairment

The Company reviews its long-lived assets that have finite lives for impairment in accordance with ASC Topic 360, Property, Plant, and Equipment (“Topic 360”). This topic requires that companies evaluate the fair value of long-lived assets based on the anticipated undiscounted future cash flows to be generated by the assets when indicators of impairment exist to determine if there is impairment to the carrying value. Any change in the carrying amount of an asset as a result of the Company's evaluation has been recorded in either restructuring expense, if it was a result of the Company's restructuring activities, or general and administrative expense for all other impairments in the consolidated statements of operations. Impairment charges associated with restructuring are discussed in Note 7 "Restructuring Expense". In the first quarter of 2014, the Company had no impairment charges.

Reclassifications

Reclassifications

During the first quarter of 2014, while implementing a new financial reporting system, the Company redesigned its chart of accounts in order to provide more consistent internal and external reporting globally. In addition to this change, the Company's corporate management organizational structure was changed from primarily a geographic regional management organization to a more centralized functional management organization. These changes drove certain changes in the mappings of the related accounts in the chart of accounts. As these changes are correctly presented in the 2014 consolidated financial statements, these changes resulted in reclassifications in both the Consolidated Balance Sheet at December 31, 2013 and the Consolidated Statement of Operations for the three months ended March 31, 2013.

New Accounting Standards

New Accounting Standards

In July of 2013, FASB issued ASU 2013-11 Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Taskforce) ("ASU 2013-11"). Beginning January 1, 2014, the effective date of this regulation, the Company has adopted the provisions of ASU 2013-11 related to presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. 

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	May 05, 2014
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Trading Symbol	XRM
Entity Registrant Name	XERIUM TECHNOLOGIES INC
Entity Central Index Key	0001287151
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		15,410,122

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Description of Business and Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Components of Inventories

The components of inventories are as follows at:

	March 31, 2014			December 31, 2013
Raw materials	$	22,708		$	22,009
Work in process	31,907			28,414
Finished goods (includes consigned inventory of $8,815 at March 31, 2014 and $8,697 at December 31, 2013)	42,047			41,845
Inventory allowances	(8,367		)	(8,338		)
	$	88,295		$	83,930

Changes In Warranty Liability

The table below represents the changes in the Company’s warranty liability for the three months ended March 31, 2014:

Beginning Balance		Charged to  Cost of Sales		Effect of Foreign Currency Translation			Deduction from Reserves			Ending Balance
$	1,629	$	327	$	(5	)	$	(422	)	$	1,529

Computation of Basic and Diluted Weighted-Average Shares

The following table sets forth the computation of basic and diluted weighted-average shares:

	Three Months Ended March 31,
	2014	2013
Weighted-average common shares outstanding–basic	15,391,391	15,312,523
Dilutive effect of stock-based compensation awards outstanding	980,381	68,681
Weighted-average common shares outstanding–diluted	16,371,772	15,381,204

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Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Statement [Abstract]
Net Sales	$ 133,384	$ 139,805
Costs and expenses:
Cost of products sold	81,218	85,298
Selling	18,178	19,221
General and administrative	14,797	14,634
Research and development	1,946	1,954
Restructuring	4,651	1,255
Operating Costs and Expenses, Total	120,790	122,362
(Loss) Income from operations	12,594	17,443
Interest expense, net	(8,657)	(9,206)
Foreign exchange loss	(877)	(249)
Income before provision for income taxes	3,060	7,988
Provision for income taxes	(1,893)	(2,503)
Net income	1,167	5,485
Comprehensive (loss) income	$ (758)	$ 2,727
Net income per share:
Basic (in dollars per share)	$ 0.08	$ 0.36
Diluted (in dollars per share)	$ 0.07	$ 0.36
Shares used in computing net income per share:
Basic (in shares)	15,391,391	15,312,523
Diluted (in shares)	16,371,772	15,381,204

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Restructuring and Impairment Expense

3 Months Ended

Mar. 31, 2014

Restructuring and Related Activities [Abstract]

Restructuring and Impairment Expense

Restructuring and Impairment Expense

During the three months ended March 31, 2014, the Company recorded restructuring expenses of approximately $4,651.These included charges relating to the closure of a roll cover facility in Germany, the reduction of headcount and the second phase of the closure of a clothing facility in Argentina. During the three months ended March 31, 2013, the Company recorded restructuring expenses of approximately $1,255. These charges were primarily related to headcount reductions, the closure of a roll covering facility in France and the closure of a machine clothing facility in Argentina.

The following table sets forth the significant components and activity under restructuring programs for the three months ended March 31, 2014 and 2013:

	Balance at December 31,  2013		Charges		Currency     Effects			Cash Payments			Balance at March 31, 2014
Severance and other benefits	$	6,466	$	4,411	$	(46	)	$	(2,240	)	$	8,591
Facility costs and other	1,468		240		(11		)	(312		)	1,385
Total	$	7,934	$	4,651	$	(57	)	$	(2,552	)	$	9,976

	Balance at December 31,  2012		Charges (1)		Currency     Effects			Cash Payments			Balance at March 31, 2013
Severance and other benefits	$	15,577	$	775	$	(451	)	$	(4,109	)	$	11,792
Facility costs and other	335		410		(10		)	(570		)	165
Total	$	15,912	$	1,185	$	(461	)	$	(4,679	)	$	11,957

(1) Amount excludes $70 impairment charges.

Restructuring and impairment expense by segment, which is not included in Segment Earnings in Note 8, is as follows:

	Three Months Ended March 31,
	2014		2013
Clothing	$	2,254	$	409
Roll Covers	2,397		727
Corporate	—		119
Total	$	4,651	$	1,255

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Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss

3 Months Ended

Mar. 31, 2014

Equity [Abstract]

Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss

Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss

Comprehensive (loss) income for the three months ended March 31, 2014 and 2013 is as follows (net of tax benefits of $32):

	Three Months Ended March 31,
	2014			2013
Net income	$	1,167		$	5,485
Foreign currency translation adjustments	(1,669		)	(4,392		)
Pension liability changes under Topic 715	(275		)	1,602
Change in value of derivative instruments	19			32
Comprehensive (loss) income	$	(758	)	$	2,727

The components of accumulated other comprehensive loss for the three months ended March 31, 2014 are as follows (net of tax benefits of $5.1 million):

	Foreign Currency Translation     Adjustment			Pension Liability Changes Under  Topic 715			Change in Value of Derivative Instruments			Accumulated    Other Comprehensive (Loss) Income
Balance at December 31, 2013	$	(136	)	$	(29,681	)	$	(235	)	$	(30,052	)
Other comprehensive loss before reclassifications	(1,669		)	—			—			(1,669		)
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	—			(275		)	—			(275		)
Amortization of interest expense	—			—			21			21
Net current period other comprehensive (loss) income	(1,669		)	(275		)	21			(1,923		)
Balance at March 31, 2014	$	(1,805	)	$	(29,956	)	$	(214	)	$	(31,975	)

For the three months ended March 31, 2014, the amortization of actuarial losses is included in cost of products sold and general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Income.

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Restructuring and Impairment Expense (Tables)

3 Months Ended

Mar. 31, 2014

Restructuring and Related Activities [Abstract]

Restructuring Programs

The following table sets forth the significant components and activity under restructuring programs for the three months ended March 31, 2014 and 2013:

	Balance at December 31,  2013		Charges		Currency     Effects			Cash Payments			Balance at March 31, 2014
Severance and other benefits	$	6,466	$	4,411	$	(46	)	$	(2,240	)	$	8,591
Facility costs and other	1,468		240		(11		)	(312		)	1,385
Total	$	7,934	$	4,651	$	(57	)	$	(2,552	)	$	9,976

	Balance at December 31,  2012		Charges (1)		Currency     Effects			Cash Payments			Balance at March 31, 2013
Severance and other benefits	$	15,577	$	775	$	(451	)	$	(4,109	)	$	11,792
Facility costs and other	335		410		(10		)	(570		)	165
Total	$	15,912	$	1,185	$	(461	)	$	(4,679	)	$	11,957

(1) Amount excludes $70 impairment charges.

Restructuring and Impairment Expense by Segment

Restructuring and impairment expense by segment, which is not included in Segment Earnings in Note 8, is as follows:

	Three Months Ended March 31,
	2014		2013
Clothing	$	2,254	$	409
Roll Covers	2,397		727
Corporate	—		119
Total	$	4,651	$	1,255

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Derivatives and Hedging (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The following represents the fair value of these derivatives at March 31, 2014 and December 31, 2013 and the change in fair value included in foreign exchange gain in the first quarter of 2014 and 2013:

	March 31, 2014			December 31, 2013
Fair value of derivatives	$	(935	)	$	530
	Three Months Ended March 31, 2014:			Three Months Ended March 31, 2013:
Change in fair value included in foreign exchange (loss) gain for the three months ended March 31, 2014 and March 31, 2013	$	(1,211	)	$	103

Notional Amounts Sold and Purchased

he following represents the notional amounts of foreign exchange forward contracts at March 31, 2014:

	Notional Sold		Notional Purchased
Non-designated hedges of foreign exchange risk	$	28,596	$	(22,259	)

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Stock-Based Compensation and Stockholders' Deficit

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation and Stockholders' Equity

Stock-Based Compensation and Stockholders’ Deficit

The Company records stock-based compensation expense in accordance with ASC Topic 718, Accounting for Stock Compensation and has used the straight-line attribution method to recognize expense for time-based restricted stock units ("RSUs") and deferred stock units ("DSUs"). The Company recorded stock-based compensation expense during the three months ended March 31, 2014 and March 31, 2013 as follows:

	Three Months Ended March 31,
	2014		2013
RSU, Options and DSU Awards (1)	$	509	$	295

(1) Related to RSUs, Options and DSUs awarded to certain employees and non-employee directors.

Summary of Activity under the Long-Term Incentive Plans

On May 8, 2012, the Board approved the 2012 Executive Long-Term Incentive Plan (the “2012 Executive LTIP”) under the 2010 Equity Incentive Plan (the "2010 Plan"). Awards under the 2012 Executive LTIP are both time-based and performance-based. A specific target share award is set for each participant in the 2012 Executive LTIP. Awards will be paid in the form of RSUs or shares of common stock of the Company. Time-based awards, or 50% of the total target award, were granted in the form of 54,750 time-based RSUs under the Company’s 2010 Plan. At March 31, 2014, 13,416 time-based RSUs vested in accordance with the 2012 Executive LTIP and were converted to common stock, net of applicable tax withholdings. The remaining one-third of the time-based RSUs will vest on March 31, 2015, and convert into shares of common stock as they vest. Performance-based awards, which constitute 50% of the total award, will be determined based on the Company’s performance against a three-year cumulative Adjusted EBITDA metric, adjusted for currency fluctuations during the term of the 2012 – 2014 Executive LTIP. The performance-based awards will convert into shares of the Company’s common stock and be paid after the close of the three-year performance period. The amount of the payment will be based on a sliding scale ranging from 50% if the metric is achieved at 85% of the target up to 200% if the metric is achieved at or above 115% of the target.

On June 13, 2013, at the 2013 Annual Meeting of Stockholders of Xerium Technologies, Inc., the stockholders of the Company approved an amendment to the 2010 Plan, which increased the aggregate number of shares of the Company’s common stock that may be delivered under or in satisfaction of awards under such plan from 913,525 to 1,663,525, increased the number of shares that may be subject to option and stock appreciation right grants and that may be granted as stock awards to any one participant in a calendar year from 150,000 to 500,000, and set a maximum cash award that may be granted to any one participant in a calendar year at $2,000. This amendment was approved by the Company’s Board of Directors on March 12, 2013.

On June 13, 2013, after the stockholders had approved the amendment to the 2010 Plan, the Board approved the granting of awards under the 2013 Executive Long-Term Incentive Plan (the "2013 Executive LTIP") under the 2010 Plan. Awards under the 2013 Executive LTIP are both time-based and performance-based and will be paid in the form of RSUs or shares of common stock of the Company. Time-based awards, or 50% of the total target award, were granted in the form of 179,571 time-based RSUs under the Company’s 2010 Plan. These time-based awards will cliff vest on March 11, 2016, and will be converted to common stock, net of applicable tax withholdings. Performance-based awards, which constitute the remaining 50% of the total award, will vest depending on the Company’s stock price performance during the three year participant service period from March 11, 2013 through March 10, 2016. If the awards vest, they will convert into shares of the Company’s common stock and be paid after the close of the three-year performance period.

Other Stock Compensation Plans

On August 15, 2012, in connection with the previously announced anticipated retirement of Stephen R. Light, the Board of Directors of the Company appointed Harold C. Bevis to the position of President and Chief Executive Officer, effective immediately, and Mr. Light notified the Company of his resignation, effective as of that date, as the Company's Chairman, President and Chief Executive Officer. The Company granted Mr. Bevis a sign-on award of 204,208 restricted stock units and options to acquire 781,701 shares of the Company's Common Stock, par value $0.001 per share. Both the restricted stock units and the options will vest over a three year period, beginning on the second anniversary of the August 15, 2012 grant date. The options have a 10-year term and an exercise price of $4.00 per share, the August 15, 2012 closing price of the Company's common stock on the New York Stock Exchange. In addition, on August 15, 2012, the Company accelerated the vesting of Mr. Light's remaining 50,000 restricted stock units, issuing 27,900 shares of common stock, upon vesting, net of certain tax withholdings.

Directors’ Deferred Stock Unit Plan

Under the 2011 non-management directors stock plan ("2011 DSU Plan”), each director receives an annual retainer of $112, to be paid on a quarterly basis in arrears. Half of the annual retainer is payable in DSUs, with the remaining half payable in DSUs, cash or a mix of both at the election of each director. The non-management directors were awarded an aggregate of 5,668 DSUs under the 2011 DSU Plan for service during the quarter ended March 31, 2014. In addition, in accordance with the 2011 DSU Plan, 4,796 DSUs were settled in Common Stock during the quarter ended March 31, 2014.

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Business Segment Information

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Business Segment Information

Business Segment Information

The Company is a global manufacturer and supplier of consumable products used primarily in the production of paper and is organized into two reportable segments: Clothing and Roll Covers. The Clothing segment represents the manufacture and sale of synthetic textile belts used to transport paper along the length of papermaking machines. The Roll Covers segment primarily represents the manufacture and refurbishment of covers used on the steel rolls of papermaking machines and the servicing of those rolls. The Company manages each of these operating segments separately.

Management evaluates segment performance based on earnings before interest, taxes, depreciation and amortization and before allocation of corporate charges. Such measure is then adjusted to exclude items that are of an unusual nature and are not used in measuring segment performance or are not segment specific (“Segment Earnings (Loss)”). The accounting policies of these segments are the same as those for the Company as a whole. Inter-segment net sales and inter-segment eliminations are not material for any of the periods presented.

Summarized financial information for the Company’s reportable segments is presented in the tables that follow for the three months ended March 31, 2014 and 2013.

	Clothing		Roll Covers		Corporate			Total
Three Months Ended March 31, 2014:
Net Sales	$	88,971	$	44,413	$	—		$	133,384
Segment Earnings (Loss)	$	19,124	$	7,836	$	(1,258	)
Three Months Ended March 31, 2013:
Net Sales	$	89,937	$	49,868	$	—		$	139,805
Segment Earnings (Loss)	$	18,062	$	14,070	$	(2,989	)

Provided below is a reconciliation of Segment earnings (loss) to income before provision for income taxes for the three months ended March 31, 2014 and 2013, respectively.

	Quarter Ended March 31,
	2014			2013
Segment Earnings (Loss):
Clothing	$	19,124		$	18,062
Roll Covers	7,836			14,070
Corporate	(1,258		)	(2,989		)
Stock-based compensation	(509		)	(295		)
Idle facility asset impairment	—			(857		)
Interest expense, net	(8,657		)	(9,206		)
Depreciation and amortization	(8,649		)	(9,542		)
Restructuring expense	(4,651		)	(1,255		)
Plant startup costs	(176		)	—
Income before provision for income taxes	$	3,060		$	7,988

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

The Company is involved in various legal matters which have arisen in the ordinary course of business as a result of various immaterial labor claims, taxing authority reviews and other routine legal matters. As of March 31, 2014, the Company accrued an immaterial amount in its financial statements for these matters for which the Company believed the possibility of loss was probable and was able to estimate the damages. The Company does not believe that the ultimate resolution of these matters will have a material adverse effect on its financial position, results of operations or cash flow. The Company believes that any additional liability in excess of amounts provided which may result from the resolution of legal matters will not have a material adverse effect on the financial condition, liquidity or cash flow of the Company. See Note 4 for a discussion of Xerium Brazil’s proceeding with the FRD.

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Supplemental Guarantor Financial Information

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Guarantor Financial Information

1. Supplemental Guarantor Financial Information

On May 26, 2011, the Company closed on the sale of its Notes. The Notes are unsecured obligations of the Company and are fully and unconditionally guaranteed on a senior unsecured basis by all of the domestic wholly owned subsidiaries of the Company (the “Guarantors”). In accordance with Rule 3-10 of Regulation S-X promulgated under the Securities Act of 1933, as amended, the following condensed consolidating financial statements present the financial position, results of operations and cash flows of Xerium Technologies, Inc. (referred to as “Parent” for the purpose of this note only) on a stand-alone parent-only basis, the Guarantors on a Guarantors-only basis, the combined non-Guarantor subsidiaries and elimination entries necessary to arrive at the information for the Parent, the Guarantors and non-Guarantor subsidiaries on a consolidated basis.

Xerium Technologies, Inc.

Consolidating Balance Sheet—(Unaudited)

At March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	685		$	(11	)	$	17,339	$	—		$	18,013
Accounts receivable, net	60			23,786			70,774		—			94,620
Intercompany receivables	(111,677		)	108,965			2,712		—			—
Inventories, net	—			18,464			70,727		(896		)	88,295
Prepaid expenses	198			1,287			5,088		—			6,573
Other current assets	—			4,352			10,050		—			14,402
Total current assets	(110,734		)	156,843			176,690		(896		)	221,903
Property and equipment, net	25,018			59,706			232,129		—			316,853
Investments	712,436			288,753			—		(1,001,189		)	—
Goodwill	—			17,737			50,199		—			67,936
Intangible assets	11,141			2,710			414		—			14,265
Other assets	5			—			10,101		—			10,106
Total assets	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	1,436		$	10,077		$	26,360	$	—		$	37,873
Accrued expenses	13,233			8,464			47,441		—			69,138
Current notes payable	—			—			8,243					8,243
Current maturities of long-term debt	2,062			—			142		—			2,204
Total current liabilities	16,731			18,541			82,186		—			117,458
Long-term debt, net of current maturities	433,163			608			—		—			433,771
Capitalized lease obligations	4,324			—			—		—			4,324
Deferred taxes	609			3,040			12,140		—			15,789
Pension, other post-retirement and post-employment obligations	11,011			1,063			54,653		—			66,727
Other long-term liabilities	126			—			4,621		—			4,747
Intercompany loans	242,251			(359,058		)	116,807		—			—
Total stockholders’ (deficit) equity	(70,349		)	861,555			199,126		(1,002,085		)	(11,753		)
Total liabilities and stockholders’ equity	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063

Xerium Technologies, Inc.

Consolidating Balance Sheet

At December 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	4,120		$	(10	)	$	21,606	$	—		$	25,716
Accounts receivable, net	—			22,188			65,764		—			87,952
Intercompany receivables	(112,848		)	110,434			2,414		—			—
Inventories, net	—			18,077			66,632		(779		)	83,930
Prepaid expenses	398			936			6,845		—			8,179
Other current assets	514			3,729			11,452		—			15,695
Total current assets	(107,816		)	155,354			174,713		(779		)	221,472
Property and equipment, net	15,794			59,250			234,620		—			309,664
Investments	700,697			284,444			—		(985,141		)	—
Goodwill	—			17,737			51,238		—			68,975
Intangible assets	10,964			3,094			412		—			14,470
Other assets	4			—			9,479		—			9,483
Total assets	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	2,109		$	10,380		$	29,731	$	—		$	42,220
Accrued expenses	9,794			8,172			43,402		—			61,368
Current notes payable	—			—			8,267		—			8,267
Current maturities of long-term debt	2,024			—			142		—			2,166
Total current liabilities	13,927			18,552			81,542		—			114,021
Long-term debt, net of current maturities	432,706			—			—		—			432,706
Deferred taxes	327			3,040			12,983		—			16,350
Pension, other post-retirement and post-employment obligations	11,212			1,182			54,472		—			66,866
Other long-term liabilities	106			5			5,459		—			5,570
Intercompany loans	233,755			(355,003		)	121,248		—			—
Total stockholders’ (deficit) equity	(72,390		)	852,103			194,758		(985,920		)	(11,449		)
Total liabilities and stockholders’ equity	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive Income (Loss) (Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	43,156		$	99,265		$	(9,037	)	$	133,384
Costs and expenses:
Cost of products sold	(419		)	29,999			60,731			(9,093		)	81,218
Selling	113			5,068			12,997			—			18,178
General and administrative	1,884			2,520			10,393			—			14,797
Research and development	276			1,118			552			—			1,946
Restructuring and impairment	(18		)	237			4,432			—			4,651
	1,836			38,942			89,105			(9,093		)	120,790
(Loss) income from operations	(1,836		)	4,214			10,160			56			12,594
Interest expense, net	(8,242		)	1,395			(1,810		)	—			(8,657		)
Foreign exchange loss	(12		)	(81		)	(784		)	—			(877		)
Equity (deficit) in subsidiaries income	11,731			5,892			—			(17,623		)	—
Income before provision for income taxes	1,641			11,420			7,566			(17,567		)	3,060
Provision for income taxes	(474		)	(34		)	(1,385		)	—			(1,893		)
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Comprehensive income (loss)	$	1,578		$	11,116		$	4,115		$	(17,567	)	$	(758	)

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive (Loss) Income-(Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	46,115		$	105,399		$	(11,709	)	$	139,805
Costs and expenses:
Cost of products sold	(450		)	30,863			66,594			(11,709		)	85,298
Selling	—			5,871			13,350			—			19,221
General and administrative	1,982			807			11,845			—			14,634
Research and development	—			1,359			595			—			1,954
Restructuring and impairment	119			238			898			—			1,255
	1,651			39,138			93,282			(11,709		)	122,362
(Loss) income from operations	(1,651		)	6,977			12,117			—			17,443
Interest (expense) income, net	(6,704		)	1,406			(3,908		)	—			(9,206		)
Foreign exchange gain (loss)	183			(13		)	(419		)	—			(249		)
Equity in subsidiaries income (deficit)	13,704			4,754			—			(18,458		)	—
Dividend income	—			1,555			—			(1,555		)	—
Income before provision for income taxes	5,532			14,679			7,790			(20,013		)	7,988
Provision for income taxes	(47		)	106			(2,562		)	—			(2,503		)
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Comprehensive income	$	5,254		$	14,562		$	2,924		$	(20,013	)	$	2,727

Xerium Technologies, Inc.

Consolidating Statement of Cash Flows-(Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The  Company
Operating activities
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	456			—			53			—			509
Depreciation	108			1,850			6,275			—			8,233
Amortization of intangibles	—			384			32			—			416
Deferred financing cost amortization	716			—			—			—			716
Foreign exchange loss on revaluation of debt	(1,103		)	—			—			—			(1,103		)
Deferred tax expense	282			—			(1,090		)	—			(808		)
Loss on disposition of property and equipment	—			22			5			—			27
Provision for doubtful accounts	—			165			80			—			245
Undistributed equity in earnings of subsidiaries	(11,731		)	(5,892		)	—			17,623			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(61		)	(1,762		)	(5,229		)	—			(7,052		)
Inventories	—			(387		)	(3,605		)	(56		)	(4,048		)
Prepaid expenses	201			(351		)	1,750			—			1,600
Other current assets	515			(623		)	927			—			819
Accounts payable and accrued expenses	2,767			(11		)	1,446			—			4,202
Deferred and other long-term liabilities	(182		)	(828		)	(1,150		)	—			(2,160		)
Intercompany loans	(1,171		)	1,401			(230		)	—			—
Net cash (used in) provided by operating activities	(8,036		)	5,354			5,445			—			2,763
Investing activities
Capital expenditures, gross	(5,537		)	(922		)	(4,035		)	—			(10,494		)
Intercompany property and equipment transfers, net	—			—			—			—			—
Proceeds from disposals of property and equipment	—			35			8			—			43
Net cash used in investing activities	(5,537		)	(887		)	(4,027		)	—			(10,451		)
Financing activities													—
Proceeds from borrowings	7,580												7,580
Principal payments on debt	(6,600		)	—			—			—			(6,600		)
Payment of obligations under capital leases	(126		)	(64		)							(190		)
Payment of financing fees	(710		)										(710		)
Intercompany loans	9,994			(4,404		)	(5,590		)	—			—
Net cash provided by (used in) financing activities	10,138			(4,468		)	(5,590		)	—			80
Effect of exchange rate changes on cash flows	—			—			(95		)	—			(95		)
Net decrease in cash	(3,435		)	(1		)	(4,267		)	—			(7,703		)
Cash and cash equivalents at beginning of period	4,120			(10		)	21,606			—			25,716
Cash and cash equivalents at end of period	$	685		$	(11	)	$	17,339		$	—		$	18,013

Xerium Technologies, Inc.

Consolidating Statement of Cash Flows (Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The Company
Operating activities
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	295			—			—			—			295
Depreciation	33			1,903			7,030			—			8,966
Amortization of intangibles	—			553			23			—			576
Deferred financing cost amortization	516			—			193			—			709
Foreign exchange loss on revaluation of debt	—			—			(118		)	—			(118		)
Deferred tax expense	—			—			282			—			282
Asset impairment	208			—			720						928
Loss (gain) on disposition of property and equipment	1			3			(14		)	—			(10		)
Intercompany dividend	—			—									—
Provision for doubtful accounts	—			(53		)	88			—			35
Undistributed equity in (earnings) loss of subsidiaries	(13,704		)	(4,754		)	—			18,458			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	—			(3,595		)	(5,632		)	—			(9,227		)
Inventories	—			529			399			—			928
Prepaid expenses	3			(639		)	1,088			—			452
Other current assets	(2,182		)	(35		)	254			—			(1,963		)
Accounts payable and accrued expenses	5,158			(234		)	(3,533		)	1,555			2,946
Deferred and other long-term liabilities	42			68			(111		)	—			(1		)
Intercompany loans	854			(1,496		)	642			—			—
Net cash (used in) provided by operating activities	(3,291		)	7,035			6,539			—			10,283
Investing activities
Capital expenditures, gross	(1,466		)	(632		)	(1,615		)	—			(3,713		)
Proceeds from disposals of property and equipment	—			—			317			—			317
Net cash used in investing activities	(1,466		)	(632		)	(1,298		)	—			(3,396		)
Financing activities
Principal payments on debt	(313		)	—			(290		)	—			(603		)
Intercompany loans	7,499			(6,449		)	(1,050		)	—			—
Net cash provided by (used in) financing activities	7,186			(6,449		)	(1,340		)	—			(603		)
Effect of exchange rate changes on cash flows	—			(1		)	(297		)	—			(298		)
Net increase (decrease) in cash	2,429			(47		)	3,604			—			5,986
Cash and cash equivalents at beginning of period	6,471			36			28,270			—			34,777
Cash and cash equivalents at end of period	$	8,900		$	(11	)	$	31,874		$	—		$	40,763

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Derivatives and Hedging - Notional Amounts of Outstanding Foreign Exchange Forward Contracts (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014
Derivatives Sold
Derivative [Line Items]
Non-designated hedges of foreign exchange risk	$ 28,596
Derivatives Purchased
Derivative [Line Items]
Non-designated hedges of foreign exchange risk	$ 22,259

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Supplemental Guarantor Financial Information - Consolidating Statement Of Cash Flows (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Operating activities
Net income	$ 1,167	$ 5,485
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Stock-based compensation	509	295
Depreciation	8,233	8,966
Amortization of intangibles	416	576
Deferred financing cost amortization	716	709
Unrealized foreign exchange loss on revaluation of debt	(1,103)	(118)
Deferred tax expense	(808)	282
(Loss) Gain on disposition of property and equipment	27	(10)
Provision for doubtful accounts	245	35
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(7,052)	(9,227)
Inventories	(4,048)	928
Prepaid expenses	1,600	452
Other current assets	819	(1,963)
Accounts payable and accrued expenses	4,202	2,946
Deferred and other long-term liabilities	(2,160)	(1)
Net cash provided by operating activities	2,763	10,283
Investing activities
Capital expenditures, gross	(10,494)	(3,713)
Proceeds from disposals of property and equipment	43	317
Net cash used in investing activities	(10,451)	(3,396)
Financing activities
Proceeds from borrowings	7,580	0
Principal payments on debt	(6,600)	(603)
Payment of obligations under capital leases	(190)	0
Payment of financing fees	(710)	0
Net cash provided by (used) in financing activities	80	(603)
Effect of exchange rate changes on cash flows	(95)	(298)
Net (decrease) increase in cash	(7,703)	5,986
Cash and cash equivalents at beginning of period	25,716	34,777
Cash and cash equivalents at end of period	18,013	40,763
Parent
Operating activities
Net income	1,167	5,485
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Stock-based compensation	456	295
Depreciation	108	33
Deferred financing cost amortization	716	516
Unrealized foreign exchange loss on revaluation of debt	(1,103)
Deferred tax expense	282
Asset impairment		208
(Loss) Gain on disposition of property and equipment		1
Undistributed equity in (earnings) loss of subsidiaries	(11,731)	(13,704)
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(61)
Prepaid expenses	201	3
Other current assets	515	(2,182)
Accounts payable and accrued expenses	2,767	5,158
Deferred and other long-term liabilities	(182)	42
Intercompany loans	(1,171)	854
Net cash provided by operating activities	(8,036)	(3,291)
Investing activities
Capital expenditures, gross	(5,537)	(1,466)
Net cash used in investing activities	(5,537)	(1,466)
Financing activities
Proceeds from borrowings	7,580
Principal payments on debt	(6,600)	(313)
Payment of obligations under capital leases	(126)
Payment of financing fees	(710)
Intercompany loans	9,994	7,499
Net cash provided by (used) in financing activities	10,138	7,186
Net (decrease) increase in cash	(3,435)	2,429
Cash and cash equivalents at beginning of period	4,120	6,471
Cash and cash equivalents at end of period	685	8,900
Total Guarantors
Operating activities
Net income	11,386	14,785
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Depreciation	1,850	1,903
Amortization of intangibles	384	553
(Loss) Gain on disposition of property and equipment	22	3
Provision for doubtful accounts	165	(53)
Undistributed equity in (earnings) loss of subsidiaries	(5,892)	(4,754)
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(1,762)	(3,595)
Inventories	(387)	529
Prepaid expenses	(351)	(639)
Other current assets	(623)	(35)
Accounts payable and accrued expenses	(11)	(234)
Deferred and other long-term liabilities	(828)	68
Intercompany loans	1,401	(1,496)
Net cash provided by operating activities	5,354	7,035
Investing activities
Capital expenditures, gross	(922)	(632)
Proceeds from disposals of property and equipment	35
Net cash used in investing activities	(887)	(632)
Financing activities
Payment of obligations under capital leases	(64)
Intercompany loans	(4,404)	(6,449)
Net cash provided by (used) in financing activities	(4,468)	(6,449)
Effect of exchange rate changes on cash flows		(1)
Net (decrease) increase in cash		(47)
Cash and cash equivalents at beginning of period	(10)	36
Cash and cash equivalents at end of period	(11)	(11)
Total Non-Guarantors
Operating activities
Net income	6,181	5,228
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Stock-based compensation	53
Depreciation	6,275	7,030
Amortization of intangibles	32	23
Deferred financing cost amortization		193
Unrealized foreign exchange loss on revaluation of debt		(118)
Deferred tax expense	(1,090)	282
Asset impairment		720
(Loss) Gain on disposition of property and equipment	5	(14)
Provision for doubtful accounts	80	88
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(5,229)	(5,632)
Inventories	(3,605)	399
Prepaid expenses	1,750	1,088
Other current assets	927	254
Accounts payable and accrued expenses	1,446	(3,533)
Deferred and other long-term liabilities	(1,150)	(111)
Intercompany loans	(230)	642
Net cash provided by operating activities	5,445	6,539
Investing activities
Capital expenditures, gross	(4,035)	(1,615)
Intercompany property and equipment transfers, net	0
Proceeds from disposals of property and equipment	8	317
Net cash used in investing activities	(4,027)	(1,298)
Financing activities
Principal payments on debt		(290)
Intercompany loans	(5,590)	(1,050)
Net cash provided by (used) in financing activities	(5,590)	(1,340)
Effect of exchange rate changes on cash flows	(95)	(297)
Net (decrease) increase in cash	(4,267)	3,604
Cash and cash equivalents at beginning of period	21,606	28,270
Cash and cash equivalents at end of period	17,339	31,874
Other Eliminations
Operating activities
Net income	(17,567)	(20,013)
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Undistributed equity in (earnings) loss of subsidiaries	17,623	18,458
Change in assets and liabilities which provided (used) cash:
Inventories	(56)
Accounts payable and accrued expenses		1,555
Net cash provided by operating activities	0
Investing activities
Intercompany property and equipment transfers, net	0
Net cash used in investing activities	0
Financing activities
Net (decrease) increase in cash	0
Cash and cash equivalents at end of period	0
The Company
Operating activities
Net income	1,167	5,485
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:
Stock-based compensation	509	295
Depreciation	8,233	8,966
Amortization of intangibles	416	576
Deferred financing cost amortization	716	709
Unrealized foreign exchange loss on revaluation of debt	(1,103)	(118)
Deferred tax expense	(808)	282
Asset impairment		928
(Loss) Gain on disposition of property and equipment	27	(10)
Provision for doubtful accounts	245	35
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(7,052)	(9,227)
Inventories	(4,048)	928
Prepaid expenses	1,600	452
Other current assets	819	(1,963)
Accounts payable and accrued expenses	4,202	2,946
Deferred and other long-term liabilities	(2,160)	(1)
Net cash provided by operating activities	2,763	10,283
Investing activities
Capital expenditures, gross	(10,494)	(3,713)
Proceeds from disposals of property and equipment	43	317
Net cash used in investing activities	(10,451)	(3,396)
Financing activities
Proceeds from borrowings	7,580
Principal payments on debt	(6,600)	(603)
Payment of obligations under capital leases	(190)
Payment of financing fees	(710)
Net cash provided by (used) in financing activities	80	(603)
Effect of exchange rate changes on cash flows	(95)	(298)
Net (decrease) increase in cash	(7,703)	5,986
Cash and cash equivalents at beginning of period	25,716	34,777
Cash and cash equivalents at end of period	$ 18,013	$ 40,763

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Pensions, Other Post-retirement and Post-employment Benefits (Tables)

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Components of Net Periodic Benefit Cost

As required by Topic 715, the following tables summarize the components of net periodic benefit cost:

Defined Benefit Plans

	Three Months Ended March 31,
	2014			2013
Service cost	$	816		$	973
Interest cost	1,650			1,560
Expected return on plan assets	(1,564		)	(1,412		)
Amortization of prior service cost	—			3
Amortization of net loss	295			572
Net periodic benefit cost	$	1,197		$	1,696

XML

Supplemental Guarantor Financial Information (Tables)

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidating Balance Sheet

Xerium Technologies, Inc.

Consolidating Balance Sheet—(Unaudited)

At March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	685		$	(11	)	$	17,339	$	—		$	18,013
Accounts receivable, net	60			23,786			70,774		—			94,620
Intercompany receivables	(111,677		)	108,965			2,712		—			—
Inventories, net	—			18,464			70,727		(896		)	88,295
Prepaid expenses	198			1,287			5,088		—			6,573
Other current assets	—			4,352			10,050		—			14,402
Total current assets	(110,734		)	156,843			176,690		(896		)	221,903
Property and equipment, net	25,018			59,706			232,129		—			316,853
Investments	712,436			288,753			—		(1,001,189		)	—
Goodwill	—			17,737			50,199		—			67,936
Intangible assets	11,141			2,710			414		—			14,265
Other assets	5			—			10,101		—			10,106
Total assets	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	1,436		$	10,077		$	26,360	$	—		$	37,873
Accrued expenses	13,233			8,464			47,441		—			69,138
Current notes payable	—			—			8,243					8,243
Current maturities of long-term debt	2,062			—			142		—			2,204
Total current liabilities	16,731			18,541			82,186		—			117,458
Long-term debt, net of current maturities	433,163			608			—		—			433,771
Capitalized lease obligations	4,324			—			—		—			4,324
Deferred taxes	609			3,040			12,140		—			15,789
Pension, other post-retirement and post-employment obligations	11,011			1,063			54,653		—			66,727
Other long-term liabilities	126			—			4,621		—			4,747
Intercompany loans	242,251			(359,058		)	116,807		—			—
Total stockholders’ (deficit) equity	(70,349		)	861,555			199,126		(1,002,085		)	(11,753		)
Total liabilities and stockholders’ equity	$	637,866		$	525,749		$	469,533	$	(1,002,085	)	$	631,063

Xerium Technologies, Inc.

Consolidating Balance Sheet

At December 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors		Other Eliminations			The Company
ASSETS
Current assets:
Cash and cash equivalents	$	4,120		$	(10	)	$	21,606	$	—		$	25,716
Accounts receivable, net	—			22,188			65,764		—			87,952
Intercompany receivables	(112,848		)	110,434			2,414		—			—
Inventories, net	—			18,077			66,632		(779		)	83,930
Prepaid expenses	398			936			6,845		—			8,179
Other current assets	514			3,729			11,452		—			15,695
Total current assets	(107,816		)	155,354			174,713		(779		)	221,472
Property and equipment, net	15,794			59,250			234,620		—			309,664
Investments	700,697			284,444			—		(985,141		)	—
Goodwill	—			17,737			51,238		—			68,975
Intangible assets	10,964			3,094			412		—			14,470
Other assets	4			—			9,479		—			9,483
Total assets	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities:
Accounts payable	$	2,109		$	10,380		$	29,731	$	—		$	42,220
Accrued expenses	9,794			8,172			43,402		—			61,368
Current notes payable	—			—			8,267		—			8,267
Current maturities of long-term debt	2,024			—			142		—			2,166
Total current liabilities	13,927			18,552			81,542		—			114,021
Long-term debt, net of current maturities	432,706			—			—		—			432,706
Deferred taxes	327			3,040			12,983		—			16,350
Pension, other post-retirement and post-employment obligations	11,212			1,182			54,472		—			66,866
Other long-term liabilities	106			5			5,459		—			5,570
Intercompany loans	233,755			(355,003		)	121,248		—			—
Total stockholders’ (deficit) equity	(72,390		)	852,103			194,758		(985,920		)	(11,449		)
Total liabilities and stockholders’ equity	$	619,643		$	519,879		$	470,462	$	(985,920	)	$	624,064

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive Income (Loss) (Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	43,156		$	99,265		$	(9,037	)	$	133,384
Costs and expenses:
Cost of products sold	(419		)	29,999			60,731			(9,093		)	81,218
Selling	113			5,068			12,997			—			18,178
General and administrative	1,884			2,520			10,393			—			14,797
Research and development	276			1,118			552			—			1,946
Restructuring and impairment	(18		)	237			4,432			—			4,651
	1,836			38,942			89,105			(9,093		)	120,790
(Loss) income from operations	(1,836		)	4,214			10,160			56			12,594
Interest expense, net	(8,242		)	1,395			(1,810		)	—			(8,657		)
Foreign exchange loss	(12		)	(81		)	(784		)	—			(877		)
Equity (deficit) in subsidiaries income	11,731			5,892			—			(17,623		)	—
Income before provision for income taxes	1,641			11,420			7,566			(17,567		)	3,060
Provision for income taxes	(474		)	(34		)	(1,385		)	—			(1,893		)
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Comprehensive income (loss)	$	1,578		$	11,116		$	4,115		$	(17,567	)	$	(758	)

Xerium Technologies, Inc.

Consolidating Statement of Operations and Comprehensive (Loss) Income-(Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total  Non Guarantors			Other Eliminations			The Company
Net sales	$	—		$	46,115		$	105,399		$	(11,709	)	$	139,805
Costs and expenses:
Cost of products sold	(450		)	30,863			66,594			(11,709		)	85,298
Selling	—			5,871			13,350			—			19,221
General and administrative	1,982			807			11,845			—			14,634
Research and development	—			1,359			595			—			1,954
Restructuring and impairment	119			238			898			—			1,255
	1,651			39,138			93,282			(11,709		)	122,362
(Loss) income from operations	(1,651		)	6,977			12,117			—			17,443
Interest (expense) income, net	(6,704		)	1,406			(3,908		)	—			(9,206		)
Foreign exchange gain (loss)	183			(13		)	(419		)	—			(249		)
Equity in subsidiaries income (deficit)	13,704			4,754			—			(18,458		)	—
Dividend income	—			1,555			—			(1,555		)	—
Income before provision for income taxes	5,532			14,679			7,790			(20,013		)	7,988
Provision for income taxes	(47		)	106			(2,562		)	—			(2,503		)
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Comprehensive income	$	5,254		$	14,562		$	2,924		$	(20,013	)	$	2,727

Consolidating Statement of Cash Flows

erium Technologies, Inc.

Consolidating Statement of Cash Flows-(Unaudited)

For the three months ended March 31, 2014

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The  Company
Operating activities
Net income	$	1,167		$	11,386		$	6,181		$	(17,567	)	$	1,167
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	456			—			53			—			509
Depreciation	108			1,850			6,275			—			8,233
Amortization of intangibles	—			384			32			—			416
Deferred financing cost amortization	716			—			—			—			716
Foreign exchange loss on revaluation of debt	(1,103		)	—			—			—			(1,103		)
Deferred tax expense	282			—			(1,090		)	—			(808		)
Loss on disposition of property and equipment	—			22			5			—			27
Provision for doubtful accounts	—			165			80			—			245
Undistributed equity in earnings of subsidiaries	(11,731		)	(5,892		)	—			17,623			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(61		)	(1,762		)	(5,229		)	—			(7,052		)
Inventories	—			(387		)	(3,605		)	(56		)	(4,048		)
Prepaid expenses	201			(351		)	1,750			—			1,600
Other current assets	515			(623		)	927			—			819
Accounts payable and accrued expenses	2,767			(11		)	1,446			—			4,202
Deferred and other long-term liabilities	(182		)	(828		)	(1,150		)	—			(2,160		)
Intercompany loans	(1,171		)	1,401			(230		)	—			—
Net cash (used in) provided by operating activities	(8,036		)	5,354			5,445			—			2,763
Investing activities
Capital expenditures, gross	(5,537		)	(922		)	(4,035		)	—			(10,494		)
Intercompany property and equipment transfers, net	—			—			—			—			—
Proceeds from disposals of property and equipment	—			35			8			—			43
Net cash used in investing activities	(5,537		)	(887		)	(4,027		)	—			(10,451		)
Financing activities													—
Proceeds from borrowings	7,580												7,580
Principal payments on debt	(6,600		)	—			—			—			(6,600		)
Payment of obligations under capital leases	(126		)	(64		)							(190		)
Payment of financing fees	(710		)										(710		)
Intercompany loans	9,994			(4,404		)	(5,590		)	—			—
Net cash provided by (used in) financing activities	10,138			(4,468		)	(5,590		)	—			80
Effect of exchange rate changes on cash flows	—			—			(95		)	—			(95		)
Net decrease in cash	(3,435		)	(1		)	(4,267		)	—			(7,703		)
Cash and cash equivalents at beginning of period	4,120			(10		)	21,606			—			25,716
Cash and cash equivalents at end of period	$	685		$	(11	)	$	17,339		$	—		$	18,013

Xerium Technologies, Inc.

Consolidating Statement of Cash Flows (Unaudited)

For the three months ended March 31, 2013

(Dollars in thousands)

	Parent			Total Guarantors			Total Non Guarantors			Other Eliminations			The Company
Operating activities
Net income	$	5,485		$	14,785		$	5,228		$	(20,013	)	$	5,485
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Stock-based compensation	295			—			—			—			295
Depreciation	33			1,903			7,030			—			8,966
Amortization of intangibles	—			553			23			—			576
Deferred financing cost amortization	516			—			193			—			709
Foreign exchange loss on revaluation of debt	—			—			(118		)	—			(118		)
Deferred tax expense	—			—			282			—			282
Asset impairment	208			—			720						928
Loss (gain) on disposition of property and equipment	1			3			(14		)	—			(10		)
Intercompany dividend	—			—									—
Provision for doubtful accounts	—			(53		)	88			—			35
Undistributed equity in (earnings) loss of subsidiaries	(13,704		)	(4,754		)	—			18,458			—
Change in assets and liabilities which provided (used) cash:
Accounts receivable	—			(3,595		)	(5,632		)	—			(9,227		)
Inventories	—			529			399			—			928
Prepaid expenses	3			(639		)	1,088			—			452
Other current assets	(2,182		)	(35		)	254			—			(1,963		)
Accounts payable and accrued expenses	5,158			(234		)	(3,533		)	1,555			2,946
Deferred and other long-term liabilities	42			68			(111		)	—			(1		)
Intercompany loans	854			(1,496		)	642			—			—
Net cash (used in) provided by operating activities	(3,291		)	7,035			6,539			—			10,283
Investing activities
Capital expenditures, gross	(1,466		)	(632		)	(1,615		)	—			(3,713		)
Proceeds from disposals of property and equipment	—			—			317			—			317
Net cash used in investing activities	(1,466		)	(632		)	(1,298		)	—			(3,396		)
Financing activities
Principal payments on debt	(313		)	—			(290		)	—			(603		)
Intercompany loans	7,499			(6,449		)	(1,050		)	—			—
Net cash provided by (used in) financing activities	7,186			(6,449		)	(1,340		)	—			(603		)
Effect of exchange rate changes on cash flows	—			(1		)	(297		)	—			(298		)
Net increase (decrease) in cash	2,429			(47		)	3,604			—			5,986
Cash and cash equivalents at beginning of period	6,471			36			28,270			—			34,777
Cash and cash equivalents at end of period	$	8,900		$	(11	)	$	31,874		$	—		$	40,763

XML

Supplemental Guarantor Financial Information - Condensed Consolidated Balance Sheet (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 18,013	$ 25,716	$ 40,763	$ 34,777
Accounts receivable, net	94,620	87,952
Inventories, net	88,295	83,930
Prepaid expenses	6,573	8,179
Other current assets	14,402	15,695
Total current assets	221,903	221,472
Property and equipment, net	316,853	309,664
Goodwill	67,936	68,975
Intangible assets	14,265	14,470
Other assets	10,106	9,483
Total assets	631,063	624,064
Current liabilities:
Accounts payable	37,873	42,220
Accrued expenses	69,138	61,368
Notes payable	8,243	8,267
Current maturities of long-term debt	2,204	2,166
Total current liabilities	117,458	114,021
Long-term debt, net of current maturities	433,771	432,706
Liabilities under capital leases	4,324	0
Deferred taxes	15,789	16,350
Pension, other post-retirement and post-employment obligations	66,727	66,866
Other long-term liabilities	4,747	5,570
Total stockholders’ (deficit) equity	(11,753)	(11,449)
Total liabilities and stockholders’ deficit	631,063	624,064
Parent
Current assets:
Cash and cash equivalents	685	4,120	8,900	6,471
Accounts receivable, net	60
Intercompany receivables	(111,677)	(112,848)
Prepaid expenses	198	398
Other current assets		514
Total current assets	(110,734)	(107,816)
Property and equipment, net	25,018	15,794
Investments	712,436	700,697
Intangible assets	11,141	10,964
Other assets	5	4
Total assets	637,866	619,643
Current liabilities:
Accounts payable	1,436	2,109
Accrued expenses	13,233	9,794
Current maturities of long-term debt	2,062	2,024
Total current liabilities	16,731	13,927
Long-term debt, net of current maturities	433,163	432,706
Liabilities under capital leases	4,324
Deferred taxes	609	327
Pension, other post-retirement and post-employment obligations	11,011	11,212
Other long-term liabilities	126	106
Intercompany loans	242,251	233,755
Total stockholders’ (deficit) equity	(70,349)	(72,390)
Total liabilities and stockholders’ deficit	637,866	619,643
Total Guarantors
Current assets:
Cash and cash equivalents	(11)	(10)	(11)	36
Accounts receivable, net	23,786	22,188
Intercompany receivables	108,965	110,434
Inventories, net	18,464	18,077
Prepaid expenses	1,287	936
Other current assets	4,352	3,729
Total current assets	156,843	155,354
Property and equipment, net	59,706	59,250
Investments	288,753	284,444
Goodwill	17,737	17,737
Intangible assets	2,710	3,094
Other assets	0
Total assets	525,749	519,879
Current liabilities:
Accounts payable	10,077	10,380
Accrued expenses	8,464	8,172
Total current liabilities	18,541	18,552
Long-term debt, net of current maturities	608
Deferred taxes	3,040	3,040
Pension, other post-retirement and post-employment obligations	1,063	1,182
Other long-term liabilities		5
Intercompany loans	(359,058)	(355,003)
Total stockholders’ (deficit) equity	861,555	852,103
Total liabilities and stockholders’ deficit	525,749	519,879
Total Non-Guarantors
Current assets:
Cash and cash equivalents	17,339	21,606	31,874	28,270
Accounts receivable, net	70,774	65,764
Intercompany receivables	2,712	2,414
Inventories, net	70,727	66,632
Prepaid expenses	5,088	6,845
Other current assets	10,050	11,452
Total current assets	176,690	174,713
Property and equipment, net	232,129	234,620
Goodwill	50,199	51,238
Intangible assets	414	412
Other assets	10,101	9,479
Total assets	469,533	470,462
Current liabilities:
Accounts payable	26,360	29,731
Accrued expenses	47,441	43,402
Notes payable	8,243	8,267
Current maturities of long-term debt	142	142
Total current liabilities	82,186	81,542
Deferred taxes	12,140	12,983
Pension, other post-retirement and post-employment obligations	54,653	54,472
Other long-term liabilities	4,621	5,459
Intercompany loans	116,807	121,248
Total stockholders’ (deficit) equity	199,126	194,758
Total liabilities and stockholders’ deficit	469,533	470,462
Other Eliminations
Current assets:
Cash and cash equivalents	0
Inventories, net	(896)	(779)
Total current assets	(896)	(779)
Investments	(1,001,189)	(985,141)
Total assets	(1,002,085)	(985,920)
Current liabilities:
Total stockholders’ (deficit) equity	(1,002,085)	(985,920)
Total liabilities and stockholders’ deficit	(1,002,085)	(985,920)
The Company
Current assets:
Cash and cash equivalents	18,013	25,716	40,763	34,777
Accounts receivable, net	94,620	87,952
Inventories, net	88,295	83,930
Prepaid expenses	6,573	8,179
Other current assets	14,402	15,695
Total current assets	221,903	221,472
Property and equipment, net	316,853	309,664
Goodwill	67,936	68,975
Intangible assets	14,265	14,470
Other assets	10,106	9,483
Total assets	631,063	624,064
Current liabilities:
Accounts payable	37,873	42,220
Accrued expenses	69,138	61,368
Notes payable	8,243	8,267
Current maturities of long-term debt	2,204	2,166
Total current liabilities	117,458	114,021
Long-term debt, net of current maturities	433,771	432,706
Liabilities under capital leases	4,324
Deferred taxes	15,789	16,350
Pension, other post-retirement and post-employment obligations	66,727	66,866
Other long-term liabilities	4,747	5,570
Total stockholders’ (deficit) equity	(11,753)	(11,449)
Total liabilities and stockholders’ deficit	$ 631,063	$ 624,064

XML

Comprehensive (Loss) Income and Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) (USD $)	3 Months Ended
	Mar. 31, 2014
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at December 31, 2013	$ (30,052,000)
Other comprehensive loss before reclassifications	(1,669,000)
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	(275,000)
Amortization of interest expense	21,000
Net current period other comprehensive (loss) income	(1,923,000)
Balance at March 31, 2014	(31,975,000)
Other comprehensive income (loss), tax	5,100,000
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at December 31, 2013	(136,000)
Other comprehensive loss before reclassifications	(1,669,000)
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	0
Amortization of interest expense	0
Net current period other comprehensive (loss) income	(1,669,000)
Balance at March 31, 2014	(1,805,000)
Accumulated Defined Benefit Plans Adjustment [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at December 31, 2013	(29,681,000)
Other comprehensive loss before reclassifications	0
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	(275,000)
Amortization of interest expense	0
Net current period other comprehensive (loss) income	(275,000)
Balance at March 31, 2014	(29,956,000)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Balance at December 31, 2013	(235,000)
Other comprehensive loss before reclassifications	0
Amounts reclassified from other comprehensive income
Amortization of actuarial losses	0
Amortization of interest expense	21,000
Net current period other comprehensive (loss) income	21,000
Balance at March 31, 2014	$ (214,000)

XML

Condensed Consolidated Statements of Cash Flows-(Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Operating activities
Net income	$ 1,167	$ 5,485
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation	509	295
Depreciation	8,233	8,966
Amortization of intangibles	416	576
Deferred financing cost amortization	716	709
Foreign exchange gain on revaluation of debt	(1,103)	(118)
Deferred tax expense	(808)	282
Asset impairment	0	928
(Loss) Gain on disposition of property and equipment	27	(10)
Provision for doubtful accounts	245	35
Change in assets and liabilities which provided (used) cash:
Accounts receivable	(7,052)	(9,227)
Inventories	(4,048)	928
Prepaid expenses	1,600	452
Other current assets	819	(1,963)
Accounts payable and accrued expenses	4,202	2,946
Deferred and other long-term liabilities	(2,160)	(1)
Net cash provided by operating activities	2,763	10,283
Investing activities
Capital expenditures, gross	(10,494)	(3,713)
Proceeds from disposals of property and equipment	43	317
Net cash used in investing activities	(10,451)	(3,396)
Financing activities
Proceeds from borrowings	7,580	0
Principal payments on debt	(6,600)	(603)
Payment of financing fees	(710)	0
Payment of obligations under capital leases	(190)	0
Net cash provided by (used) in financing activities	80	(603)
Effect of exchange rate changes on cash flows	(95)	(298)
Net (decrease) increase in cash	(7,703)	5,986
Cash and cash equivalents at beginning of period	25,716	34,777
Cash and cash equivalents at end of period	18,013	40,763
Non-cash capitalized lease asset and liability	$ 4,468	$ 0

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Pensions, Other Post-retirement and Post-employment Benefits

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Pensions, Other Post-retirement and Post-employment Benefits

Pensions, Other Post-retirement and Post-employment Benefits

The Company accounts for its pensions, other post-retirement and post-employment benefit plans in accordance with ASC Topic 715, Compensation—Retirement Benefits (“Topic 715”). The Company has defined benefit pension plans covering substantially all of its U.S. and Canadian employees and employees of certain subsidiaries in other countries. Benefits are generally based on the employee’s years of service and compensation. These plans are funded in conformity with the funding requirements of applicable government regulations. The Company does not fund certain plans, as funding is not required. The Company plans to continue to fund its U.S. defined benefit plans to comply with the Pension Protection Act of 2006. In addition, the Company also intends to fund its U.K. and Canadian defined benefit plans in accordance with local regulations.

As required by Topic 715, the following tables summarize the components of net periodic benefit cost:

Defined Benefit Plans

	Three Months Ended March 31,
	2014			2013
Service cost	$	816		$	973
Interest cost	1,650			1,560
Expected return on plan assets	(1,564		)	(1,412		)
Amortization of prior service cost	—			3
Amortization of net loss	295			572
Net periodic benefit cost	$	1,197		$	1,696

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Description of Business and Significant Accounting Policies - Components of Inventories (Detail) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Inventories, Net [Abstract]
Raw materials	$ 22,708	$ 22,009
Work in process	31,907	28,414
Finished goods (includes consigned inventory of $8,815 at March 31, 2014 and $8,697 at December 31, 2013)	42,047	41,845
Inventory allowances	(8,367)	(8,338)
Inventories, net	$ 88,295	$ 83,930

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Income Taxes - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Income Taxes [Line Items]
Provision for income taxes	$ 1,893	$ 2,503
Gross unrecognized tax benefit	7,919
Unrecognized tax benefit increase	428
Other long-term liabilities	4,747		5,570
Other assets	10,106		9,483
Tax, penalties and interest	41,086
Minimum
Income Taxes [Line Items]
Statutory income tax rate in foreign countries	15.00%
Maximum
Income Taxes [Line Items]
Statutory income tax rate in foreign countries	39.43%
BRAZIL | Foreign Tax Authority [Member]
Income Taxes [Line Items]
Income Tax Examination, Percentage Increase (Decrease) in Liability from Prior Year			(50.00%)
Income Tax Examination, Increase (Decrease) in Liability from Prior Year	11,102
Income Tax Examination, Liability Recorded	29,984
Restatement Adjustment [Member] | Accounting Standards Update 2013-11 [Member]
Income Taxes [Line Items]
Other long-term liabilities	1,147
Other assets	$ 1,147

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Long-term Debt (Tables)

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

Schedule Of Long-Term Debt

At March 31, 2014 and December 31, 2013, long-term debt consisted of the following:

	March 31, 2014		December 31, 2013
Senior secured term loan facility, payable quarterly, U.S. Dollar denominated–LIBOR (minimum 1.25%) plus 4.50% (5.75%) net of $0.9 million discount. Matures May of 2018.	$	197,639	$	198,000
Senior Notes (Unsecured), payable semi-annually–U.S. Dollar denominated interest rate fixed at 8.875%, matures June of 2018	236,410		236,410
Other long term debt	1,926		462
	435,975		434,872
Less current maturities	2,204		2,166
Total	$	433,771	$	432,706