U S PLASTIC LUMBER CORP
SPECIAL ADVANCE PROMISSORY NOTE
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<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>g85576exv10w2.htm
<DESCRIPTION>SPECIAL ADVANCE PROMISSORY NOTE
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<P align="right"><FONT size="2"><B>Exhibit&nbsp;10.2</B></FONT>

<P align="center"><FONT size="2"><B>AMENDED AND RESTATED SECURED PROMISSORY NOTE<BR>
<U>(Special Advance Promissory Note)</U></B></FONT>

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    <TD valign="top"><FONT size="2">$2,000,000.00</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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October &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2003<BR>
Los Angeles, California</FONT></TD>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>FOR VALUE RECEIVED, </B>the undersigned <U>(&#147;Borrower&#148;)</U>, hereby promises to pay
to the order of <B>GUARANTY BUSINESS CREDIT CORPORATION <U>(&#147;GBCC&#148;)</U>, </B>at its offices
located at 333 South Grand Avenue, Suite&nbsp;1650, Los Angeles, California 90071,
in such coin or currency of the United States which shall be legal tender in
payment of all debts and dues, public and private, at the time of payment, the
principal sum of Two Million Dollars ($2,000,000), or such lesser amount as
Borrower has drawn pursuant to the Loan Agreement (as defined below) as Special
Advance Loans, together with interest from and after the date hereof on the
unpaid principal balance outstanding at a per annum rate equal to the Default
Rate for Revolving Advances.
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note is the Special Advance Promissory Note referred to in, and is
issued pursuant to, that certain Loan and Security Agreement among Borrower and
GBCC, dated December&nbsp;19, 2002 (hereinafter, as amended, restated, supplemented
or modified from time to time, including, without limitation, by that certain
Second Amendment to Loan and Security Agreement and Limited Waiver of Defaults,
the <U>&#147;Second Amendment&#148;</U>, between Borrower and GBCC dated as of July&nbsp;25, 2003,
and by that certain Letter Agreement between Borrower and GBCC dated as of even
date herewith, the <U>&#147;Loan Agreement&#148;</U>), and is entitled to all of the benefits
and security of the Loan Agreement and the other Transaction Documents. All of
the terms, covenants and conditions of the Loan Agreement and the Transaction
Documents are hereby made a part of this Note and are deemed incorporated
herein in full. All capitalized terms used herein, unless otherwise
specifically defined in this Note, shall have the meanings ascribed to them in
the Loan Agreement. This Note amends and restates in full the Amended and
Restated Secured Promissory Note of Company dated as of October&nbsp;23, 2003.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The rate of interest in effect hereunder shall increase or decrease by an
amount equal to any increase or decrease in the Prime Rate effective as of the
opening of business on the date that any such change in the Prime Rate occurs.
Interest shall be computed in the manner provided in the Loan Agreement.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subject to the terms of the Loan Agreement and the Second Amendment, the
principal amount and accrued interest of this Note shall be due and payable
upon the occurrence of an Acceleration Event (as defined in the Second
Amendment).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon the occurrence of an Event of Default (excluding any Event of Default
expressly waived by GBCC on or before the date hereof), unless such Event of
Default is expressly curable pursuant to the Transaction Documents and has been
cured as provided therein, GBCC shall have all of the default rights and
remedies set forth in the Loan Agreement and the other Transaction Documents.
</FONT>
<P align="center"><FONT size="2">1</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Time is of the essence of this Note. To the fullest extent permitted by
applicable law, Borrower, for itself and its legal representatives, successors
and assigns, expressly waives presentment, demand, protest, notice of dishonor,
notice of non-payment, notice of maturity, notice of protest, presentment for
the purpose of accelerating maturity, diligence in collection, and the benefit
of any exemption or insolvency laws.
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Wherever possible, each provision of this Note shall be interpreted in
such manner as to be effective and valid under applicable law, but if any
provision of this Note shall be prohibited or invalid under applicable law,
such provision shall be ineffective to the extent of such prohibition or
invalidity without invalidating the remainder of such provision or remaining
provisions of this Note. No delay or failure on the part of GBCC in the
exercise of any right or remedy hereunder shall operate as a waiver thereof,
nor as an acquiescence in any default, nor shall any single or partial exercise
by GBCC of any right or remedy preclude any other right or remedy. GBCC, at its
option, may enforce its rights against any collateral securing this Note
without enforcing its rights against Borrower, any guarantor of the
indebtedness evidenced hereby or any other property or indebtedness due or to
become due to Borrower. Borrower agrees that, without releasing or impairing
Borrower&#146;s liability hereunder, GBCC may at any time release, surrender,
substitute or exchange any collateral securing this Note and may at any time
release any party primarily or secondarily liable for the indebtedness
evidenced by this Note.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Note shall be governed by, and construed and enforced in accordance
with, the laws of the State of California.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EACH OF GBCC AND BORROWER HEREBY WAIVES ITS RIGHT TO A TRIAL BY JURY, IF
ANY, IN ANY ACTION TO ENFORCE, DEFEND, INTERPRET OR OTHERWISE CONCERNING THIS
NOTE.
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and
delivered in Los Angeles, California as of the date first above written.
</FONT>
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<B>U.S. PLASTIC LUMBER LTD., a Delaware<BR>
Corporation</B></FONT></TD>
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By: /s/ Michael D. Schmidt</FONT></TD>
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Name: Michael D. Schmidt</FONT></TD>
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Title: Treasurer</FONT></TD>
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<P align="center"><FONT size="2">2</FONT>



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