Exhibit 10.16

FIFTH AMENDMENT TO

LOAN AND SECURITY AGREEMENT

as of December 1, 2006

WELLS FARGO FOOTHILL, INC., as Agent and Lender

2450 Colorado Avenue

Suite 3000 West

Santa Monica, California 90404

Ladies and Gentlemen:

Wells Fargo Foothill, Inc., as Arranger and Administrative Agent (“Agent”) and
Lender (together with all other lenders party thereto from time to time,
collectively, the “Lenders”) and BGF Industries, Inc., a Delaware corporation,
(“Borrower”) have entered into certain financing arrangements pursuant to that
certain Loan and Security Agreement, dated as of June 6, 2003, among Agent,
Lenders and Borrower (as the same now exists or may hereafter be amended,
modified, supplemented, extended, renewed, restated or replaced, the “Loan
Agreement”) and all other Loan Documents at any time executed and/or delivered
in connection therewith or related thereto. All capitalized terms used herein
shall have the meaning assigned thereto in the Loan Agreement, unless otherwise
defined herein.

Borrower, Agent and Lenders have agreed to certain amendments to the Loan
Agreement and the other Loan Documents, on and subject to the terms and
conditions contained in this Fifth Amendment to Loan and Security Agreement
(this “Amendment”).

In consideration of the foregoing and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged by the parties
hereto, the parties hereto hereby agree as follows:

1. Amendments to Loan Agreement and Loan Documents. In order to effectuate
certain amendments of the Loan Agreement and Loan Documents agreed to among
Agent, Lenders and Borrower, the Loan Agreement and Loan Documents are hereby
amended as follows:

(a) Commencing with the delivery of the Borrower’s financial statements for the
quarter ended September 30, 2006, the definition of the term “Base Rate Margin”,
as set forth in Section 1.1 of the Loan Agreement, is hereby amended and
restated in its entirety to read as follows:

““Base Rate Margin” means 0.0.%, if EBITDA, measured on a trailing twelve-month
basis as of the end of the fiscal quarter on or immediately preceding the date
of determination, is greater than $20,000,000, (ii) one-quarter of one percent
(0.25%), if EBITDA, measured on a trailing twelve-month basis as of the end of
the fiscal quarter on or immediately preceding the date of determination, is
greater than $17,000,000 but less than or equal to $20,000,000, and
(iii) one-half

--------------------------------------------------------------------------------

of one percent (0.50%), if EBITDA, measured on a trailing twelve-month basis as
of the end of the fiscal quarter on or immediately preceding the date of
determination, is less than or equal to $17,000,000.”

(b) The definition of the term “Base Rate Term Loan Margin”, as set forth in
Section 1.1 of the Loan Agreement, is hereby amended and restated in its
entirety to read as follows:

““Base Rate Term Loan Margin” means one-quarter of one percent (0.25%).”

(c) The definition of the term “Eligible Accounts”, as set forth in Section 1.1
of the Loan Agreement, is hereby amended and restated by the amendment and
restatement of clause (i) thereof in its entirety to read as follows:

“(i) Accounts with respect to an Account Debtor whose total obligations owing to
Borrower exceed: (1) 15% of all Eligible Accounts, if the Account Debtor is
Cytec Engineered Materials and its affiliates or Composix Co., (ii) $750,000, if
the Account Debtor is Owens Corning, and (iii) 10% of all Eligible Accounts,
with respect to all other Account Debtors, in each case to the extent of the
obligations owing by such Account Debtor in excess of such percentage or amount,
as applicable,”

(d) Commencing with the delivery of the Borrower’s financial statements for the
quarter ended September 30, 2006, the definition of “LIBOR Rate Margin”, as set
forth in Section 1.1 of the Loan Agreement, is hereby amended and restated in
its entirety as follows:

“LIBOR Rate Margin” means (i) two and one-quarter percent (2.25%), if EBITDA,
measured on a trailing twelve-month basis as of the end of the fiscal quarter on
or immediately preceding the date of determination, is greater than $20,000,000,
(ii) two and one-half percent (2.50%), if EBITDA, measured on a trailing
twelve-month basis as of the end of the fiscal quarter on or immediately
preceding the date of determination, is greater than $17,000,000 but less than
or equal to $20,000,000, and (iii) two and three-quarters percent (2.75%), if
EBITDA, measured on a trailing twelve-month basis as of the end of the fiscal
quarter on or immediately preceding the date of determination, is less than or
equal to $17,000,000.”

(e) The definition of the term “LIBOR Rate Term Loan Margin”, as set forth in
Section 1.1 of the Loan Agreement, is hereby amended and restated in its
entirety to read as follows:

““LIBOR Rate Term Loan Margin” means two and one-half percent (2.5%).”

(f) The definition of the term “Maximum Revolver Amount”, as set forth in
Section 1.1 of the Loan Agreement, is hereby amended and restated in its
entirety as follows:

 

2

--------------------------------------------------------------------------------

““Maximum Revolver Amount” means $21,000,000.”

(g) Section 2.6(c) of the Loan Agreement is hereby amended and restated to read
in its entirety as follows:

“(c) Upon the occurrence and during the continuation of an Event of Default (and
at the election of Agent or the Required Lenders),

1. all outstanding Obligations (except for undrawn Letters of Credit and except
for Bank Product Obligations) that have been charged to the Loan Account
pursuant to the terms hereof shall bear interest on the Daily Balance thereof at
a per annum rate equal to two (2%) percentage points above the per annum rate
otherwise applicable hereunder, and

2. the Letter of Credit fee provided for above shall be increased to two
(2%) percentage points above the per annum rate otherwise applicable hereunder.”

(h) Section 2.11(a) of the Loan Agreement is hereby amended and restated to read
in its entirety as follows:

“(a) Unused Line Fee. On the first day of each month during the term of this
Agreement, an unused line fee in an amount equal to 0.375% per annum times the
result of (a) the Maximum Revolver Amount, less (b) the sum of (i) the average
Daily Balance of Advances that were outstanding during the immediately preceding
month, plus (ii) the average Daily Balance of the Letter of Credit Usage during
the immediately preceding month, plus (iii) the then-outstanding principal
balance of the Term Loan during the immediately preceding month.”

(i) Section 2.11(c) of the Loan Agreement is hereby amended and restated by the
amendment and restatement of clause (i) thereof to read in its entirety as
follows:

“(i) a fee of $850 per day, per auditor, plus out-of-pocket expenses for each
financial audit of Borrower performed by personnel employed by Agent, provided
that, so long as no Default or Event of Default has occurred, Borrower shall not
be obligated to reimburse Agent for such fees and expenses for more than two
(2) financial audits in any calendar year,”

(j) Sections 6.2(a) and 6.2(b) of the Loan Agreement are hereby amended and
restated to read in their entirety as follows:

“(a) Reserved.

  (b) Reserved.”

(k) Section 6.2 of the Loan Agreement is hereby amended and restated by amending
and restating the heading in the left column of the chart reading “monthly (not
later than the 10th day of each month) to read in its entirety as follows:

 

3

--------------------------------------------------------------------------------

“Monthly (not later than the 15th day of each month)”

(l) Section 6.2(c) of the Loan Agreement is hereby amended and restated to read
in its entirety as follows:

“(c) accounts receivable reports including a sales journal, collection journal,
and credit register, and notice of all returns, disputes or claims”

(m) Section 6.2(f) of the Loan Agreement is hereby amended and restated to read
in its entirety as follows:

“(f) a summary aging, by vendor, of Borrower’s accounts payable and any book
overdraft, and Inventory reports specifying Borrower’s cost and the wholesale
market value of its Inventory, by category, with additional detail showing
additions to and deletions from the Inventory,”

(n) Minimum EBITDA. Section 7.20(a) of the Loan Agreement is hereby amended and
restated to read in its entirety as follows:

“(a) Minimum EBITDA. Fail to maintain EBITDA as of the end of each quarter of
not less than $15,000,000 calculated on a trailing 12 month basis, except as
Agent and Borrower may otherwise agree in writing following Agent’s receipt of
Borrower’s updated financial projections delivered in accordance with
Section 6.3(c)(ii) hereof, which financial projections shall be satisfactory to
Agent in its sole discretion.”

(o) Capital Expenditures. Section 7.20(b) of the Loan Agreement is hereby
amended and restated in its entirety to read as follows:

“(b) Capital Expenditures. Make capital expenditures in any fiscal year
exceeding, in the aggregate, $4,500,000, except as Agent and Borrower may
otherwise agree in writing following Agent’s receipt of Borrower’s financial
projections delivered in accordance with Section 6.3(c)(ii) hereof, which
financial projections shall be satisfactory to Agent in its sole discretion.”

(p) Amended and Restated Term Loan. Contemporaneously herewith, and as a
one-time financial accommodation to Borrower, Agent and Lenders are making an
additional advance to Borrower in the original principal amount of $2,120,126
(the “Second Additional Term Loan”). The Second Additional Term Loan shall be
consolidated with the currently outstanding principal balance of the existing
Term Loan, as previously consolidated (such principal balance, together with the
Second Additional Term Loan, collectively, the “Term Loan”), which Term Loan, as
of the date hereof, shall be in the original principal amount of $6,000,000 and
shall amortize as set forth in the Loan Agreement.

(q) Amendment of Fee Letter. Section 2 of the Fee Letter is hereby amended and
restated by the amendment and restatement of the first paragraph thereof to read
in its entirety as follows:

 

4

--------------------------------------------------------------------------------

“2. Servicing Fee. On the first day of each month, commencing December 1, 2006,
Borrower shall pay to Agent a servicing fee in an amount equal to Three Thousand
($3,000) Dollars.”

2. Acknowledgment.

(a) Acknowledgment of Obligations. Borrower hereby acknowledges, confirms and
agrees that as of the close of business on December 6, 2006, Borrower is
indebted to Agent and Lenders (i) in respect of the Advances, in the aggregate
principal amount of $0, (ii) in respect of the Term Loan, in the principal
amount of $3,779,874, and (iii) in respect of Letter of Credit Usage (including
undrawn Letters of Credit with an aggregate face amount of $171,438.15) in the
aggregate amount of $3,951,312.15. All such Obligations, together with interest
accrued and accruing thereon, and fees, costs, expenses and other charges
payable by Borrower to Agent and Lenders, are unconditionally owing by Borrower
to Agent and Lenders in accordance with the terms of the Loan Documents, without
offset, defense or counterclaim of any kind, nature or description whatsoever.

(b) Acknowledgment of Security Interests. Borrower and each Guarantor hereby
acknowledges, confirms and agrees that Agent and Lenders have and shall continue
to have valid, enforceable and perfected liens upon and security interests in
all collateral, including, without limitation, the Collateral, heretofore
granted to Agent and Lenders pursuant to the Loan Documents or otherwise granted
to or held by Agent or any Lender.

(c) Binding Effect of Documents. Borrower and each Guarantor hereby
acknowledges, confirms and agrees that: (i) each of the Loan Documents to which
it is a party has been duly executed and delivered to Agent and Lenders by
Borrower and such Guarantor, as the case may be, and each is in full force and
effect as of the date hereof, (ii) the agreements and obligations of Borrower
and each Guarantor contained in such documents and in this Agreement constitute
the legal, valid and binding Obligations of Borrower and each Guarantor
enforceable against each of them in accordance with their respective terms, and
neither Borrower nor any Guarantor has a valid defense to the enforcement of
such Obligations, and (iii) Agent and Lenders are and shall be entitled to the
rights, remedies and benefits available under the Loan Documents and applicable
law.

3. Representations, Warranties and Covenants. In addition to the continuing
representations, warranties and covenants heretofore or hereafter made by
Borrower and Guarantors to Agent and Lenders pursuant to the Loan Agreement and
the other Loan Documents, Borrower hereby represents, warrants and covenants
with and to Agent and Lenders as follows (which representations, warranties and
covenants are continuing and shall survive the execution and delivery hereof and
shall be incorporated into and made a part of the Loan Documents):

(a) No Event of Default exists on the date of this Amendment (after giving
effect to the amendments to the Loan Documents set forth herein).

(b) This Amendment has been duly executed and delivered by Borrower and each
Guarantor and is in full force and effect as of the date hereof, and the
agreements and

 

5

--------------------------------------------------------------------------------

obligations of Borrower and each Guarantor contained herein constitute its
legal, valid and binding obligations, enforceable against it in accordance with
the terms hereof.

4. Conditions Precedent. The effectiveness of this Amendment shall be subject to
the receipt by Agent of each of the following, in form and substance
satisfactory to Agent:

(a) a fully executed copy of this Amendment, duly authorized, executed and
delivered by Borrower and each Guarantor; and

(b) such additional documents and due diligence as may be determined by Agent.

5. Effect of this Amendment. Except as modified pursuant hereto, no other
changes or modifications to the Loan Agreement and the other Loan Documents are
intended or implied and in all other respects the Loan Agreement and the other
Loan Documents are hereby specifically ratified, restated and confirmed by all
parties hereto as of the effective date hereof. To the extent of any conflict
between the terms of this Amendment and any of the Loan Documents, the terms of
this Amendment shall control. The Loan Documents, as amended hereby, and this
Amendment shall be read and be construed as one agreement.

6. Amendment Fee. Borrower shall pay to Agent for its own account an amendment
fee in an amount equal to $25,000, which amount shall be fully earned and
payable simultaneously with the execution of this Amendment and shall not be
subject to refund, rebate or proration for any reason whatsoever. Such fee shall
be in addition to all other amounts payable under the Loan Documents, shall
constitute part of the Obligations and may, at Agent’s option, be charged
directly to any account of Borrower maintained with Agent.

7. Further Assurances. The parties hereto shall execute and deliver such
additional documents and take such additional actions as, in the exercise of
Agent’s discretion, may be necessary or desirable to effectuate the provisions
and purposes of this Amendment.

8. GOVERNING LAW. THE VALIDITY, INTERPRETATION AND ENFORCEMENT OF THIS AMENDMENT
AND ANY DISPUTE ARISING OUT OF THE RELATIONSHIP BETWEEN THE PARTIES HERETO,
WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE, SHALL BE GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO PRINCIPLES OF
CONFLICTS OF LAW).

9. Binding Effect. This Amendment shall be binding upon and inure to the benefit
of each of the parties hereto and their respective successors and assigns.

 

6

--------------------------------------------------------------------------------

10. Counterparts. This Amendment may be executed in any number of counterparts,
but all of such counterparts, when executed together, shall constitute but one
and the same agreement. In making proof of this Amendment, it shall not be
necessary to produce or account for more than one counterpart hereof signed by
each of the parties hereto. This Amendment may be executed and delivered via
telecopier with the same force and effect as if it were a manually executed and
delivered counterpart.

[SIGNATURES ON FOLLOWING PAGE]

 

7

--------------------------------------------------------------------------------

Very truly yours, BORROWER: BGF INDUSTRIES, INC. By:  

/s/ James R. Henderson

  James R. Henderson Title:   President

 

ACKNOWLEDGED AND AGREED TO BY THE GUARANTORS: NVH INC. By:  

/s/ Philippe R. Dorier

  Philippe R. Dorier Title:   Secretary & Treasurer GLASS HOLDINGS LLC By:  

/s/ Philippe R. Dorier

  Philippe R. Dorier Title:   Secretary & Treasurer BGF SERVICES, INC. By:  

/s/ Philippe R. Dorier

  Philippe R. Dorier Title:   Secretary & Treasurer AGREED:

WELLS FARGO FOOTHILL, INC.,

as Agent and Lender

By:  

/s/ Kristy S. Loucks

  Kristy S. Loucks Title:   Vice President

[Fifth Amendment to Loan and Security Agreement]