Applied Extrusion amends credit facility, gets waiver through Oct. 1 on not paying interest on notes

By Jeff Pines

Washington, Sept. 3 - Applied Extrusion Technologies Inc. obtained a waiver through Oct. 1 from General Electric Capital Corp. for its credit facility that protects Applied Extrusion from a default after it failed to make the July 1 interest payments on its 10¾% senior notes.

New Castle, Del.-based Applied Extrusion reported the waiver in a Friday filing with the Securities and Exchange Commission.

Applied Extrusion is working on a prepackaged reorganization plan, which has the support of more than 70% of its noteholders. The reorganization plan calls for noteholders to get all of the reorganized company's equity and a share of $50 million of new 12% seven-year notes. Interest may be paid in cash or in kind.

As of Aug. 27, the company had $43.74 million outstanding on its revolver and a $45.31 million term loan. Besides GE, the other lenders are Black Diamond International Funding Ltd., TRS 1 LLC and Merrill Lynch Capital.

Applied Extrusion makes specialized oriented polypropylene films used in consumer products labeling and flexible packaging.

In a previous filing, the company said it did not expect the bankruptcy to last more than 60 days.

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