WAIVER AND RIDER NO.5



Exhibit 10.11 
 
WAIVER AND RIDER NO. 5 
TO 
EQUIPMENT LEASE 
AGREEMENT 
 
THIS WAIVER AND RIDER NO. 5 TO EQUIPMENT LEASE AGREEMENT, dated as of January 10, 2003 (this “Agreement”), between
APPLIED EXTRUSION TECHNOLOGIES, INC. (the “Lessee”) and PNC LEASING, LLC, successor in interest by assignment from LASALLE NATIONAL LEASING CORPORATION (the “Lessor”). 
 
W I T N E S S E T H: 
 
WHEREAS, the Lessee and the Lessor are parties to the
Equipment Lease Agreement, dated as of December 29, 1997, as amended (the “Lease Agreement”); and 
 
WHEREAS, certain of the Lessee’s financial statements that for the period ending on or prior to September 30, 2002 that were
delivered to the Lessor were inaccurate in certain material respects and, as a result, a Default (such capitalized term and all other capitalized terms not defined herein shall have the meanings provided for in Article I) has or may have
occurred under Section 15(3), (6) and (7) of the Lease Agreement (collectively, the “Subject Events of Default”); and 
 
WHEREAS, the Lessee has delivered to the Lessor its restated financial statements for the period ending September 30, 2002 (collectively,
the “Restated Financial Statements”); and 
 
WHEREAS, the Lessee has requested that, as of the Effective Date, the Subject Events of Default be waived and the amendment set forth herein be made; and 
 
WHEREAS, the Lessor is willing, subject to the terms and conditions hereinafter set forth, to grant such
waiver; 
 
NOW, THEREFORE, in consideration of the
agreements herein contained, the parties hereto hereby agree as follows: 
 
ARTICLE I 
 
DEFINITIONS 
 
SECTION 1.1. Certain Definitions. The following terms (whether or not underscored) when used in this Agreement shall have the following meanings: 
 
“Agreement” is defined in the preamble. 
 
“Effective Date” shall have the meaning
provided in Section 5.1. 
 
“Lease
Agreement” is defined in the first recital. 







 
“Lessee” is defined in the preamble. 
 
“Lessor” is defined in the preamble. 
 
“Restated Financial Statements” is defined in the third recital. 
 
“Subject Events of Default” defined in the
second recital. 
 
SECTION 1.2.
Other Definitions. Unless otherwise defined or the context otherwise requires, terms used herein have the meanings provided for in the Lease Agreement. 
 
ARTICLE II 
 
WAIVER 
 
Effective on (and subject to the occurrence of) the Effective Date, the Lessor waives the Subject Events of Default that occurred as a
result of the delivery of the Restated Financial Statements. 
 
ARTICLE III 
 
AMENDMENT 
 
The
Lessee agrees that for each period set forth below its EBIDTA shall not be less than the applicable amount set forth opposite each such relevant period: 
 

	 Two fiscal quarters ended 3/31/03
	  	 16,433

	 Three fiscal quarters ended 6/30/03
	  	 27,945

	 Four fiscal quarters ended 9/30/03
	  	 39,419

	 Four fiscal quarters ended 12/31/03
	  	 42,000

	 Four fiscal quarters ended 3/30/04
	  	 42,000

	 Four fiscal quarters ended 6/30/04
	  	 42,000

	 Four fiscal quarters ended 9/30/04
	  	 48,000

	 and the four fiscal quarters ended every fiscal quarter thereafter
	  	 48,000


 
For
purposes hereof, “EBITDA” means the consolidated net income of the Lessee plus the consolidated interest expense of the Lessee plus the amount deducted in determining net income in respect of income taxes and amortization and
depreciation of assets, in each case of the Lessee and its subsidiaries and as calculated by the Lessee prior to the date hereof. This amendment shall form a part of the Agreement as if originally set forth therein. 
 

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ARTICLE
IV 
 
REPRESENTATIONS AND
WARRANTIES 
 
In order to induce the Lessor
to make the waiver provided for in Article II and the amendment provided for in Article III, the Lessee hereby represents and warrants that (a) after giving effect to the waiver provided in Article II each of its representations
and warranties contained in the Lease Agreement is true and correct in all material respects as of the date hereof as if made on the date hereof (except, if any such representation and warranty relates to an earlier date, such representation and
warranty shall be true and correct in all material respects as of such earlier date) and (b) both immediately before and after giving effect to the provisions of this Agreement no Default (other than the Subject Events of Default) has occurred and
is continuing. 
 
ARTICLE V

 
MISCELLANEOUS

 
SECTION 5.1. Effective
Date. This Agreement shall become effective as of January 10, 2003 (herein called the “Effective Date”) if each of the Lessor and Lessee have exchanged executed counterparts of the Agreement. 
 
SECTION 5.2. Limitation of Waiver and
Amendment. The waiver set forth in Article II and the amendment set forth in Article III shall be limited precisely as provided for herein and shall not be deemed to be a waiver of, amendment of, consent to or modification of any
other term or provision of the Lease Agreement. 
 
SECTION 5.3. Counterparts. This Agreement may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the
same agreement. 
 
SECTION 5.4.
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. 
 
SECTION 5.5. Costs and Expenses. The Lessee agrees to pay all reasonable costs and
expenses of the Lessor incurred in connection with the execution and delivery of this Agreement. 
 
SECTION 5.6. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. THE LESSOR AND THE LESSEE VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT. 
 

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IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers hereunto duly authorized as of the day and year first above written. 
 

	 LESSOR:
  

PNC LEASING, LLC

	
	 By:
	 	 /s/    JAMES G.
KLOCEK        


	 Name:
	 	 James G. Klocek

	 Title:
	 	 Vice President



 

	 LESSEE:
  

APPLIED EXTRUSION TECHNOLOGIES, INC.

	
	 By:
	 	 /s/    BRIAN P.
CRESCENZO        


	 Name:
	 	 Brian P. Crescenzo

	 Title:
	 	 Vice President of Finance



 

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