**Exhibit 10.2**

**XERIUM TECHNOLOGIES, INC.**

**MANAGEMENT INCENTIVE COMPENSATION PROGRAM**

This Xerium Technologies, Inc. Management Incentive Compensation (“MIC”) Program contains rules supplemental tothose 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 isincorporated 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; Features of Awards. The MIC shall be administered by the Committee as described in theEIP. 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 limitedto individuals who are selected in accordance with the terms of the EIP to participate in the MIC from among those individuals who are eligible to participate in the EIP (each, a “Participant”). Participation in any Award shall not entitlea Participant to share in any future Awards or in any other future awards of the Company or its subsidiaries. Each Award shall entitle the holder, subject to satisfaction of the performance conditions under the Award (and, to the extent the Award isintended to qualify for the performance-based compensation exception under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), to the further limitations of the EIP with respect thereto), to a benefitdetermined under Section 2 below and Exhibit A (the “Performance-Based Benefit Amount”) that shall be payable in cash or shares of the Company’s Common Stock (“Shares”) in accordance with Exhibit A,subject to tax withholding as described in Section 4 below. The number of Shares deliverable in respect of all or part of an Award shall be determined as described in Section 3 below. 

2. Determination of Performance-Based Benefit Amount. The determination of each Participant’s Performance-Based BenefitAmount under an Award for the performance year shall be made in accordance with the provisions of Exhibit A applicable to such Participant for such performance year. 

3. Determination of Number of Shares Payable. The number of Shares payable under any Award shall be the quotient determined by dividing (x) by (y), where (x) is that portion of the TotalBenefit Amount, if any, payable in Shares and (y) is the average of the per-share closing prices of the Common Stock (adjusted as appropriate to reflect any stock splits, stock dividends or similar events) for the last twenty (20) tradingdays of the performance year, rounded down to the nearest whole number. 

4. Latest Payment Date; Tax Withholding. Allpayments, if any, under an Award shall be made not later than by March 31 of the calendar year following the performance year. The minimum tax withholding amount with respect to any payments being made in cash shall be withheld from suchpayments. The minimum tax withholding amount with respect to any payments being made in Shares shall be satisfied by means of share withholding. 

5. Intent to be Exempt from Section 162(m). Awards for the 2011 performance yearare intended to qualify for the performance-based compensation exception under Section 162(m) of the Code. In the case of any Award for a subsequent performance year that is intended to so qualify, (i) the Exhibit A performancegoals with respect to such Award shall be established by the Committee not later than ninety (90) days after the commencement of the performance year (or by such earlier date as is required by Section 1.162-27(e)(2)(i) of the TreasuryRegulations), (ii) the Exhibit A performance goals, as so established, shall be consistent with the eligible performance measures, if any, approved by the shareholders of the Company for use in respect of performance awards under the EIPand shall be objectively determinable in compliance with Section 1.162-27(e)(2) of the Treasury Regulations, and (iii) no portion of the Award shall be paid unless and until the Committee has certified (as required bySection 1.162-27(e)(5) of the Treasury Regulations) that the performance goals have been achieved (or, if the performance goals are expressed in terms that admit of varying payout levels for different levels of performance, have been achievedat a level sufficient to support the payment). 

6. Nature of Awards. Awards hereunder are intended to qualify as StockUnit Awards under the EIP, with any cash portion payable pursuant to Section 9(d) of the EIP. The MIC is unfunded and any cash payments by the Company hereunder shall be made from the general assets of the Company. 

7. Termination of Employment. No Award shall be payable to or in respect of a Participant, except as the Committee shall otherwiseexpressly determine, unless the Participant is employed by the Company or a subsidiary on December 31 of the performance year. 

8. Availability of Common Stock. If, when Awards become payable in respect of any performance year, the number of shares of Common Stock needed to grant any Shares under the Awards exceeds thenumber of shares then available under the EIP, the Shares shall be delivered when the shareholders approve an increase in the number of shares available under the EIP. If the shareholders do not approve such an increase so that all or part of theShares are not delivered, the Company will pay out the value of any Shares that were not delivered in cash and determine their value by reversing the calculation under Section 3 above used to determine the number of such Shares. 

9. Treatment of Awards Upon a Change of Control. If (a) the Company merges into or combines with any other entity and,immediately following such merger or combination, any Person or group of Persons acting in concert holds 50% or more of the voting power of the entity surviving such merger or combination (other than any Person or group of Persons which held 50% ormore of the Company’s voting power immediately prior to such merger or combination or any Affiliated Person of any such Person or member of such group) (each of (a), (b) or (c) a “Change of Control”); (b) any Person orgroup of Persons acting in concert acquires 50% or more of the Company’s voting power; or (c) the Company sells all or substantially all of its assets or business for cash or for securities of another Person or group of Persons (other thanto any Person or group of Persons which held 50% or more of the Company’s total voting power immediately prior to such sale or to any Affiliated Person of any such Person or any member of such group), then, unless the Committee provides for thecontinuation or assumption of Awards or for the grant of new awards in substitution therefor (which substitute awards, if any, may be payable in cash or other property or a combination thereof) by the surviving entity or acquiror, in each case onsuch terms and subject to such conditions as the Committee may determine, with respect to each Award not so assumed or continued: 

(a) In the event such transaction occurs on or after the close of the performance year with respect to the Award, the Committee shall determine, acting in its sole and reasonable discretion, prior to theoccurrence of the transaction, the extent to which the applicable performance metrics specified in Exhibit A have been satisfied. If financial statements or other relevant data are not available prior to the time of such determination, theCommittee shall make such determination based upon the financial information and data then available to the Company. 

 
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(b) In the event such transaction occurs prior to the close of the performance year withrespect to the Award, the applicable performance metrics specified in Exhibit A shall be determined as follows: (i) the performance year shall be deemed to end on the effective date of such transaction; and (ii) the extent to whichthe applicable performance metrics specified in Exhibit A for the shortened performance year described in clause (i) above have been achieved shall be determined by the Committee based upon the financial information available to theCompany (it being understood that the Committee may, to the extent it deems necessary, extrapolate performance through the effective date of the transaction based upon available data); (iii) the performance determined pursuant to clause(ii) shall then be adjusted by multiplying it by fraction, the numerator of which is the number of days in the shortened performance year and the denominator of which is 365, and the performance as so adjusted shall be the basis for determiningthe Performance-Based Benefit Amount with respect to the Award, subject to proration in accordance with Section 9(c) below. 

(c) If subsection (b) above applies, the Performance-Based Benefit Amount initially determined under subsection (b) with respect to an Award shall be prorated by multiplying such initiallydetermined amount by a fraction, the numerator of which is the number of days in the shortened performance year and the denominator of which is 365. 

For purposes of this Section 9, “Person” means any individual, partnership, limited liability company, corporation, association, trust, joint venture, unincorporated organization, or otherentity or group, and “Affiliated Person” means, with respect to any Person, any other Person that directly or indirectly controls or is controlled by or is under common control with such Person. 

10. Clawback.****If a participant receives an Award payout under the MIC based on financial statements that are subsequentlyrequired to be restated in a way that would decrease the amount of the Award to which the Participant was entitled, the Participant will refund to the Company the difference between what the Participant received and what the Participant should havereceived; provided that 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 amanner 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. 

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

12.409A. 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 regulationspromulgated thereunder. 

 
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**XERIUM TECHNOLOGIES, INC.**

**MANAGEMENT INCENTIVE COMPENSATION PROGRAM**

**Exhibit A (Applicable to 2011 Performance Year)**

There is one type of Award underthe MIC for the 2011 performance year. Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with U.S. generally accepted accounting principles**(“GAAP”)**. 

**Awards**

 
i.Metrics
Two measures of performance willbe used in determining the Performance-Based Benefit Amount, if any, under an Award: (i) Xerium 2011 Bank Adjusted EBITDA (weighted at 80%) and (ii) Xerium 2011 Net Sales (weighted at 20%) (collectively, the “Metrics”).

 
 (1)Bank Adjusted EBITDA Metric
The“Bank Adjusted EBITDA Metric” means “Adjusted EBITDA,” as such term is defined in the first sentence of the definition of such term in the Second Amended and Restated Credit and Guaranty Agreement (the “CreditAgreement”), dated as of May 25, 2010, entered into by and among the Company, certain subsidiaries of the Company, Citigroup Global Markets Inc., and other agents and banks party thereto, as in effect for Xerium Technologies, Inc. for theyear ended December 31, 2011. The Committee shall determine the Bank Adjusted EBITDA Metric relative to the target for such metric set forth below. 

 
 (2)Net Sales Metric
The “Net SalesMetric” means “Net Sales,” as defined under GAAP and as reported in the Consolidated Statement of Operations as set forth in the Company’s Form 10-K. The Committee shall determine the Net Sales Metric relative to the target forsuch metric set forth below. 

 
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ii.Currency Adjustments 
Both Metrics will beadjusted 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
  $0.254  
AUD
  $0.906  
BRL
  $0.568  
CAD
  $0.972  
CHF
  $0.960  
CNY
  $0.148  
EUR
  $1.307  
GBP
  $1.571  
JPY
  $0.012  
MXN
  $0.079  
SEK
  $0.165  
VND
  $0.000052  
 
iii.Targets
The targets for the Metrics for2011 are (1) “Target Bank Adjusted EBITDA Metric” at $126.3 million and (2) “Target Net Sales Metric” at $576.6 million respectively; provided, however, that the amounts may be adjusted by the Committeeafter 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. 

 
iv.Determination of Performance-Based Benefit Amount
The Performance-Based Benefit Amount payable with respect to an Award shall be the sum of the amounts determined pursuant to Section iv(1) and iv(2) below. 

 
 (1)Bank Adjusted EBITDA Metric
“X” below refers to the portion of the target award for a Participant that is based on the Bank Adjusted EBITDA Metric. 

“Y” refers to the Target Bank Adjusted EBITDA Metric set forth above. 

The portion of the Performance-Based Benefit Amount payable with respect to the Bank Adjusted EBITDA Metric shall be determined as follows: 

Bank Adjusted EBITDA Metric below .95Y: no payment 

Bank Adjusted EBITDA Metric at .95Y: bonus = .35X 

Bank Adjusted EBITDA Metric atY: bonus = X 

Bank Adjusted EBITDA Metric at 1.20Y or above: bonus = 2X 

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

 
 (2)Net Sales Metric
“X” belowrefers to the portion of the target award for a Participant that is based on the Net Sales Metric. 

“Y” refers to the Target NetSales EBITDA Metric set forth above. 

The portion of the Performance-Based Benefit Amount payable with respect to the Net Sales Metric shallbe determined as follows: 

Net Sales Metric below .95Y: no payment 

Net Sales Metric at .95Y: bonus = .35X 

Net Sales Metric at Y: bonus = X 

Net Sales Metric at 1.10Y or above: bonus = 2X

The amount payable between the levels of Net Sales Metric identified above shall be determined on the basis of straight line interpolationbetween points. 

 
v.Payout
The Performance-Based BenefitAmount with respect to an Award shall be payable to a Participant in the following manner: 

50% Cash 

50% Shares 

 
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