EXHIBIT 10.22

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS AND,
ACCORDINGLY, MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF EXCEPT
(1) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND
APPLICABLE STATE SECURITIES LAWS OR (2) PURSUANT TO AN APPLICABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.

WARRANT AGREEMENT

To Purchase Shares of Voting Common Stock, par value $.10 per share of

RADNOR HOLDINGS CORPORATION

Dated as of April 4, 2006 (the “Effective Date”)

WHEREAS, Radnor Holdings Corporation, a Delaware corporation (the “Company”),
has entered into a Purchase Agreement dated as of the date hereof (the “Purchase
Agreement”) with Special Value Expansion Fund, LLC, a Delaware limited liability
company and Special Value Opportunities Fund, LLC, a Delaware limited liability
company, pursuant to which such purchasers are entitled to receive warrants to
purchase a number of shares equal to 7.0% (assuming the exercise of outstanding
warrants, including this Warrant Agreement, to purchase 102 shares) as of the
date hereof of the Company’s outstanding Voting Common Stock; and

WHEREAS, pursuant to the Purchase Agreement, the Company desires to grant to
Warrantholder, in consideration for its commitment under the Purchase Agreement,
the right to purchase shares of the Company’s Voting Common Stock, $.10 par
value per share (the “Voting Common Stock”).

NOW, THEREFORE, in consideration of the Warrantholder’s execution of the
Purchase Agreement and providing the financial accommodations provided for
therein, and the mutual covenants and agreements contained herein, the Company
and the Warrantholder agree as follows:

1. GRANT OF THE RIGHT TO PURCHASE VOTING COMMON STOCK.

The Company hereby grants to Special Value Opportunities Fund, LLC (the
“Warrantholder”), and the Warrantholder is entitled, upon the terms and subject
to the conditions hereinafter set forth, to subscribe to and purchase, from the
Company, at a purchase price per share equal to $0.01 (the “Exercise Price”)
under this Warrant Agreement (“Warrant Agreement” or this “Warrant”),
thirty-four (34) fully paid and non-assessable shares of the Voting Common
Stock. The number of shares and Exercise Price for such shares set forth in this
Section 1 are subject to adjustment as provided in Section 8 hereof.

2. TERM OF THE WARRANT AGREEMENT.

Except as otherwise provided for herein, the term of this Warrant Agreement and
the right to purchase Voting Common Stock as granted herein shall commence on
the Effective Date and shall be exercisable for a period ending on the seventh
(7th) anniversary of the Effective Date.

3. EXERCISE OF THE PURCHASE RIGHTS.

(a) Exercise. The purchase rights set forth in this Warrant Agreement are
exercisable by the Warrantholder, in whole or in part, at any time, or from time
to time, prior to the expiration of the term set forth in Section 2 above, by
tendering to the Company at its principal office a notice of exercise in the
form attached hereto as Exhibit I (the “Notice of Exercise”), duly completed and
executed. Promptly upon receipt of the Notice of Exercise and the payment of the
Exercise Price in accordance with the terms set forth below, and in no event
later than five (5) business days thereafter, the Company shall issue to the
Warrantholder a certificate for the number of shares of Voting Common Stock
purchased and shall execute the acknowledgment of exercise in the form attached

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hereto as Exhibit II (the “Acknowledgment of Exercise”) indicating the number of
shares which remain subject to future purchases, if any. Notwithstanding the
foregoing, in the event that the Warrantholder elects to effect a Net Issuance
(as defined below), the Company and the Warrantholder shall execute, and shall
effect such Net Issuance pursuant to, an exchange agreement in the form attached
hereto as Exhibit III (the “Exchange Agreement”).

The Exercise Price may be paid at the Warrantholder’s election either (i) by
cash or check, or (ii) at any time on or after the Company completes a
registered public offering of its common stock (the “Common Stock”), by
surrender of Warrants (“Net Issuance”) as determined below.

If the Warrantholder elects the Net Issuance method, the Company will issue
Voting Common Stock in accordance with the following formula:

X = Y(A-B)

            A

 

  Where:      X = the number of shares of Voting Common Stock to be issued to
the Warrantholder.

 

  Y = the number of shares of Voting Common Stock requested to be exercised
under this Warrant Agreement.

 

  A = the fair market value of one (1) share of Common Stock at the time the net
issuance election is made.

 

  B = the Exercise Price.

For purposes of the above calculation, current fair market value of Common Stock
shall mean with respect to each share of Common Stock:

(i) if the exercise is in connection with an initial public offering of the
Company’s Common Stock, and if the Company’s Registration Statement relating to
such public offering has been declared effective by the SEC, then the fair
market value per share shall be the initial “Price to Public” of the Common
Stock specified in the final prospectus with respect to the offering;

(ii) if this Warrant is exercised after, and not in connection with the
Company’s initial public offering, and:

(a) if the Common Stock is traded on a securities exchange, the fair market
value shall be deemed to be the average of the closing prices over a ten
(10) day period ending three days before the day the current fair market value
of the Voting Common Stock is being determined; or

(b) if the Common Stock is traded over-the-counter, the fair market value shall
be deemed to be the average of the closing bid and asked prices quoted on the
NASDAQ system (or similar system) over the ten (10) day period ending three days
before the day the current fair market value of the Voting Common Stock is being
determined.

(iii) if at any time the Common Stock is not listed on any securities exchange
or quoted in the NASDAQ system or over-the-counter market, then the Exercise
Price may be paid only by cash or check.

Upon partial exercise by either cash or Net Issuance, the Company shall promptly
issue an amended Warrant Agreement representing the remaining number of shares
purchasable hereunder. All other terms and conditions of such amended Warrant
Agreement shall be identical to those contained herein, including, but not
limited to, the Effective Date hereof.

(b) Exercise Prior to Expiration. Notwithstanding any other provision of this
Warrant Agreement and to the extent this Warrant is not previously exercised as
to all Voting Common Stock subject hereto, and if the fair market value of one
share of Common Stock, calculated as set forth above, is greater than the
Exercise Price then in effect, this Warrant shall be deemed automatically
exercised by Net Issuance pursuant to Section 3(a) above (even if not
surrendered) immediately before its expiration. For purposes of such automatic
exercise, the fair market value of one share of Common Stock upon such
expiration shall be determined pursuant to Section 3(a) above. To the extent
this Warrant or any portion thereof is deemed automatically exercised pursuant
to this Section 3(b), the Company agrees to promptly notify the Warrantholder of
the number of shares of Voting Common Stock the Warrantholder is to receive by
reason of such automatic exercise.

 

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4. RESERVATION OF SHARES.

During the term of this Warrant Agreement, the Company will at all times have
authorized and reserved a sufficient number of shares of its Voting Common Stock
to provide for the exercise of the rights to purchase Voting Common Stock as
provided for herein.

5. NO FRACTIONAL SHARES OR SCRIP.

No fractional shares or scrip representing fractional shares shall be issued
upon the exercise of the Warrant, but in lieu of such fractional shares the
Company shall make a cash payment therefor upon the basis of the Exercise Price
then in effect.

6. NO RIGHTS AS STOCKHOLDER.

This Warrant Agreement alone does not entitle the Warrantholder to any voting
rights or other rights as a stockholder of the Company prior to the exercise of
the Warrant.

7. WARRANTHOLDER REGISTRY.

The Company shall maintain a registry showing the name and address of the
registered holder of this Warrant Agreement.

8. ADJUSTMENT RIGHTS.

The purchase price per share and the number of shares of Voting Common Stock
purchasable hereunder are subject to adjustment, as follows:

(a) Merger and Sale of Assets. If at any time there shall be a capital
reorganization of the shares of the Company’s stock (other than a combination,
reclassification, exchange or subdivision of shares otherwise provided for
herein), or a merger or consolidation of the Company with or into another
corporation whether or not the Company is the surviving corporation, or the sale
of all or substantially all of the Company’s properties and assets to any other
person (hereinafter referred to as a “Merger Event”), then, as a part of such
Merger Event, lawful provision shall be made so that the Warrantholder shall
thereafter be entitled to receive, upon exercise of the Warrant, the number of
shares of stock, property, money or other securities of the successor
corporation resulting from such Merger Event, equivalent in value to that which
would have been issuable if Warrantholder had exercised this Warrant immediately
prior to the Merger Event. In any such case, appropriate adjustment (as
determined in good faith by the Company’s Board of Directors) shall be made in
the application of the provisions of this Warrant Agreement with respect to the
rights and interest of the Warrantholder after the Merger Event to the end that
the provisions of this Warrant Agreement (including adjustments of the Exercise
Price and number of shares of Voting Common Stock purchasable) shall be
applicable to the greatest extent possible.

(b) Reclassification of Shares. If the Company at any time shall, by
combination, reclassification, exchange or subdivision of securities or
otherwise, change any of the securities as to which purchase rights under this
Warrant Agreement exist into the same or a different number of securities of any
other class or classes, this Warrant Agreement shall thereafter represent the
right to acquire such number and kind of securities as would have been issuable
as the result of such change with respect to the securities which were subject
to the purchase rights under this Warrant Agreement immediately prior to such
combination, reclassification, exchange, subdivision or other change.

(c) Subdivision or Combination of Shares. If the Company at any time shall
combine its Voting Common Stock, the number of shares exercisable under this
Warrant Agreement shall be proportionately decreased and the Exercise Price
shall be proportionately increased, and if the Company at any time shall
subdivide its Voting Common Stock, the number of shares exercisable under this
Warrant Agreement shall be proportionately increased and the Exercise Price
shall be proportionately decreased.

(d) Stock Dividends. If the Company at any time shall pay a dividend payable in,
or make any other distribution (except any distribution specifically provided
for in the foregoing subsections (a) or (b) or a distribution payable in cash or
any other property other than capital stock) on the Company’s Voting Common
Stock, then the number of shares exercisable under this Warrant Agreement shall
be adjusted, from and after the record date of such dividend or distribution, to
that number and type of shares that would have been received by the holder of
this Warrant had the Warrantholder exercised this Warrant immediately prior to
the payment of such dividend or distribution. After such adjustment, such
adjusted number of shares receivable upon exercise of this Warrant shall be
further adjusted from time as set forth in this Section 8.

 

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(e) Notice of Amendments. The Company shall promptly provide the Warrantholder
with any restatement, amendment, modification or waiver of the Company’s
Certificate of Incorporation that pertains to the Voting Common Stock.

(f) Notice of Adjustments. If: (i) the Company shall declare any dividend or
distribution upon its stock, whether in cash, property, stock or other
securities; (ii) the Company shall offer for subscription prorata to the holders
of any class of its stock any additional shares of stock of any class or other
rights; (iii) there shall be any Merger Event; (iv) there shall be an initial
public offering; or (v) there shall be any voluntary dissolution, liquidation or
winding up of the Company; then, in connection with each such event, the Company
shall send to the Warrantholder: (A) no later than the date such notice, if any,
is provided to the Company’s stockholders, written notice of the date on which
the books of the Company shall close or a record shall be taken for such
dividend, distribution, subscription rights (specifying the date on which the
holders of Voting Common Stock shall be entitled thereto) or for determining
rights to vote in respect of such Merger Event, dissolution, liquidation or
winding up; (B) in the case of any such Merger Event, dissolution, liquidation
or winding up, no later than the date such notice, if any, is provided to the
Company’s stockholders, written notice of the date when the same shall take
place (and specifying the date on which the holders of Voting Common Stock shall
be entitled to exchange their Voting Common Stock for securities or other
property deliverable upon such Merger Event, dissolution, liquidation or winding
up); and (C) in the case of a public offering, the Company shall give the
Warrantholder no later than the date such notice, if any, is provided to the
Company’s stockholders, written notice prior to the effective date thereof. To
the extent the foregoing provisions conflict with any term of the Investor
Rights Agreement (as defined below), the Investor Rights Agreement shall
control.

Each such written notice shall set forth, in reasonable detail, (i) the event
requiring the adjustment, (ii) the amount of the adjustment, (iii) the method by
which such adjustment was calculated, (iv) the Exercise Price, and (v) the
number of shares subject to purchase hereunder after giving effect to such
adjustment, and shall be given by first class mail, postage prepaid, addressed
to the Warrantholder, at the address as shown on the books of the Company.

(g) Timely Notice. Failure to timely provide such notice required by subsection
(f) above shall entitle Warrantholder to retain the benefit of the applicable
notice period notwithstanding anything to the contrary contained in any
insufficient notice received by Warrantholder.

9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY .

(a) Reservation of Common Stock. The Voting Common Stock issuable upon exercise
of the Warrantholder’s rights has been duly and validly reserved and, when
issued in accordance with the provisions of this Warrant Agreement, will be
validly issued, fully paid and non-assessable, and will be free of any taxes,
liens, charges or encumbrances of any nature whatsoever; provided, however, that
the Voting Common Stock issuable pursuant to this Warrant Agreement may be
subject to restrictions on transfer under state and/or Federal securities laws.
The Company has made available to the Warrantholder true, correct and complete
copies of its Charter and Bylaws, as amended. The issuance of certificates for
shares of Voting Common Stock upon exercise of the Warrant Agreement shall be
made without charge to the Warrantholder for any issuance tax in respect
thereof, or other cost incurred by the Company in connection with such exercise
and the related issuance of shares of Voting Common Stock. The Company shall not
be required to pay any tax which may be payable in respect of any transfer
involved and the issuance and delivery of any certificate in a name other than
that of the Warrantholder.

(b) Due Authority. The execution and delivery by the Company of this Warrant
Agreement and the performance of all obligations of the Company hereunder,
including the issuance to Warrantholder of the right to acquire the shares of
Voting Common Stock, have been duly authorized by all necessary corporate action
on the part of the Company, and this Warrant Agreement is not inconsistent with
the Company’s Charter or Bylaws, does not contravene any law or governmental
rule, regulation or order applicable to it, does not and will not contravene any
provision of, or constitute a default under, any indenture, mortgage, contract,
shareholders agreement, registration rights agreement or other instrument to
which it is a party or by which it is bound, and constitutes a legal, valid and
binding agreement of the Company, enforceable in accordance with its terms.

 

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10. TRANSFERS.

Subject to the terms and conditions contained in the Investor Rights Agreement
dated as of even date herewith (as amended from time to time, the “Investor
Rights Agreement”) among the Company, the Warrantholder and other holders of the
Company’s securities, this Warrant Agreement and all rights hereunder are
transferable in whole or in part by the Warrantholder and any successor
transferee. The transfer shall be recorded on the books of the Company upon
receipt by the Company of a notice of transfer in the form attached hereto as
Exhibit IV (the “Transfer Notice”), at its principal offices and the payment to
the Company of all transfer taxes and other governmental charges imposed on such
transfer.

11. REGISTRATION RIGHTS. Warrantholder shall be entitled, with respect to the
shares of Voting Common Stock issued upon exercise hereof or the shares of
Common Stock or other securities issued upon conversion of such Voting Common
Stock as the case may be, to all of the registration rights set forth in the
Investor Rights Agreement.

12. DEFINITIONS.

(a) For the purposes of this Warrant Agreement, the following terms shall have
the meanings indicated:

“Acknowledgment of Exercise” shall have the meaning given thereto in
Section 3(a) hereof.

“Capital Stock” means, with respect to any Person, any common stock, preferred
stock and any other capital stock of such Person and shares, interests,
participations or other ownership interest (however designated), of any Person
and any rights (other than debt securities convertible into, or exchangeable
for, capital stock), warrants or options to purchase any of the foregoing,
including (without limitation) each class of common stock and preferred stock of
such Person if such Person is a corporation and each general and limited
partnership interest of such Person if such Person is a partnership.

“Common Stock” shall have the meaning given thereto in Section 3(a) hereof.

“Company” shall have the meaning given thereto in the preambles hereof.

“Company Independent Appraiser” shall have the meaning given thereto in
Section 13(a) hereof.

“Effective Date” shall have the meaning given thereto in the heading of this
Warrant Agreement.

“Equity Interests” means shares, interests, participations or other equivalents
(however designated) of Capital Stock and all warrants, options or other rights
to acquire Capital Stock (but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock).

“Exchange Agreement” shall have the meaning given thereto in Section 3(a)
hereof.

“Exercise Price” shall have the meaning given thereto in Section 1 hereof.

“Investor Rights Agreement” shall have the meaning given thereto in Section 10
hereof.

“Merger Event” shall have the meaning given thereto in Section 8(a) hereof.

“Mutual Determination” shall have the meaning given thereto in Section 13(a)
hereof.

“Mutual Independent Appraiser” shall have the meaning given thereto in
Section 13(a) hereof.

“Net Issuance” shall have the meaning given thereto in Section 3(a) hereof.

“Notice of Exercise” shall have the meaning given thereto in Section 3(a)
hereof.

“Party Determination” shall have the meaning given thereto in Section 13(a)
hereof.

“Person” means any individual, corporation, partnership, limited partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.

“Purchase Agreement” shall have the meaning given thereto in the preambles
hereof.

 

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“Put Notice” shall have the meaning given thereto in Section 13(a) hereof.

“Put Option” shall have the meaning given thereto in Section 13(a) hereof.

“Transfer Notice” shall have the meaning given thereto in Section 10 hereof.

“Voting Common Stock” shall have the meaning given thereto in the preambles
hereof.

“Warrant” or “Warrant Agreement” shall have the meaning given thereto in
Section 1 hereof.

“Warrantholder” shall have the meaning given thereto in Section 1 hereof.

“Warrantholder Independent Appraiser” shall have the meaning given thereto in
Section 13(a) hereof.

(b) Capitalized terms used but not defined herein shall have the respective
meanings given thereto in the Purchase Agreement.

13. PUT OPTION.

(a) At any time after March 31, 2010, upon written demand from the Warrantholder
(such written demand, the “Put Notice”), the Company shall purchase and the
Warrantholder shall sell the number of Warrants indicated in the Put Notice (the
“Put Option”) at a price equal to the Fair Market Value of such Warrants. For
purposes of this Section 13, “Fair Market Value” of a Warrant shall be the fair
market value of the Warrant determined as of the date of delivery of the Put
Notice to the Company by reference to the current fair market value of Common
Stock if such current fair market value can be determined pursuant to
Section 3(a) hereof. If such current fair market value cannot be determined
pursuant to Section 3(a) hereof, “Fair Market Value” of a Warrant shall be the
fair market value of the Warrant, determined as of the date of delivery of the
Put Notice to the Company, as agreed between the Company and the Warrantholder
as the result of good faith negotiations between them, within fifteen (15) days
of the date of delivery of the Put Notice to the Company. If the Company and the
Warrantholder are not able to agree on the Fair Market Value of a Warrant
pursuant to the preceding sentence within fifteen (15) days of the date of
delivery of the Put Notice to the Company, “Fair Market Value” of a Warrant
shall be the fair market value of the Warrant, determined in each case as of the
date of delivery of the Put Notice to the Company, by an independent appraiser
or independent appraisers as follows:

(i) within 15 days of delivery of the Put Notice to the Company, the
Warrantholder shall select an independent appraiser (the “Warrantholder
Independent Appraiser”) and provide written notice to the Company of the
identity of such independent appraiser, and the Company shall select an
independent appraiser (the “Company Independent Appraiser”) and provide written
notice to the Warrantholder of the identity of such independent appraiser. The
Company and the Warrantholder shall instruct the Company Independent Appraiser
and the Warrantholder Independent Appraiser to work together in good faith to
select a third independent appraiser (the “Mutual Independent Appraiser”) within
20 days of delivery of the Put Notice to the Company.

(ii) Fair Market Value shall be as determined by the Warrantholder Independent
Appraiser; provided that if, within five days of receipt of the determination of
Fair Market Value made by the Warrantholder Independent Appraiser, the Company
provides written notice to the Warrantholder that the Company objects to such
determination, the Company shall obtain, as promptly as is reasonably
practicable and in any event within 30 days of receipt of the determination of
Fair Market Value made by the Warrantholder Independent Appraiser, a
determination of fair market value from the Company Independent Appraiser (each
of the determination of fair market value of the Warrantholder Independent
Appraiser and the determination of fair market value of the Company Independent
Appraiser, a “Party Determination” and together the “Party Determinations”) and
shall, within five days of receipt thereof, provide written notice of such
determination to the Warrantholder.

(iii) In the event that the Company obtains a determination of fair market value
from the Company Independent Appraiser pursuant to the foregoing subclause (ii),
(A) in the event that the lower of the Party Determinations is not more than 10%
lower that the higher of the Party Determinations, Fair Market Value shall be
the average of the Party Determinations, and (B) in the event that the lower of
the Party Determinations is 10% or more lower than the higher of the Party
Determinations, the parties shall obtain, as promptly as is reasonably
practicable and in any event within 30 days of the receipt of the determination
of the Company Independent Appraiser, a determination of fair market value from
the Mutual Independent Appraiser (a “Mutual Determination”).

 

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(iv) In the event that the parties obtain a Mutual Determination pursuant to the
foregoing subclause (iii), (X) if the Mutual Determination is greater than the
lower of the Party Determinations, but lesser than the higher of the Party
Determinations, then Fair Market Value shall be the Mutual Determination, (Y) if
the Mutual Determination is less than or equal to the lower of Party
Determinations, then Fair Market Value shall be the lower of the Party
Determinations, and (Z) if the Mutual Determination is equal to or greater than
the higher of the Party Determinations, then Fair Market Value shall be the
higher of the Party Determinations.

The Company agrees to cooperate with the appraisers and to provide the
appraisers with such access to the Company’s books, records and personnel as the
appraisers might reasonably require in making such determinations. The fees and
expenses of any such determination made by the appraisers shall be borne by the
Company. The Fair Market Value of the Warrants shall be based upon a valuation
of the Company as if all of its operations were being sold to a single purchaser
in an arm’s length transaction between a willing purchaser and a willing seller
through a disposition of all of its stock or assets and such valuation shall be
determined without regard to the fact that the shares issuable upon exercise of
the Warrants may constitute a minority ownership interest in a closely held
corporation and shall not give effect to any discount for lack of liquidity of
the Warrants or the shares issuable upon exercise of the Warrants, the fact that
the Warrants or the shares issuable upon exercise of the Warrants may not be
registered under the Securities Act or any contractual restrictions limiting the
ability of the Warrantholder to dispose of the Warrants or the shares issuable
upon exercise of the Warrants or limiting the ability of a transferee of such
shares to transfer such shares.

(b) The Put Option can be exercised for all or some of the Warrants and on up to
three (3) occasions; provided that the Put Option cannot be exercised more than
twice in any calendar year.

(c) The consummation of any exercise of the Put Option shall occur on such date
as may be agreed between the Warrantholder and the Company but in no event later
than thirty (30) days after the later of (i) delivery of the applicable Put
Notice and (ii) the determination of the Fair Market Value of the Warrants
subject to the Put Option pursuant to Section 13(a) hereof.

14. MISCELLANEOUS.

(a) Effective Date. The provisions of this Warrant Agreement shall be construed
and shall be given effect in all respects as if it had been executed and
delivered by the Company on the date hereof. This Warrant Agreement shall be
binding upon any successors or assigns of the Company.

(b) Attorneys’ Fees. In any litigation, arbitration or court proceeding between
the Company and the Warrantholder relating hereto, the prevailing party shall be
entitled to attorneys’ fees and expenses and all costs of proceedings incurred
in enforcing this Warrant Agreement.

(c) Governing Law. This Warrant Agreement shall be governed by and construed for
all purposes under and in accordance with the laws of the State of New York.

(d) Counterparts. This Warrant Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

(e) Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery, facsimile
transmission (provided that the original is sent by personal delivery or mail as
hereinafter set forth) or seven (7) days after deposit in the United States
mail, by registered or certified mail, addressed (i) to the Warrantholder at
2951 28th Street, Suite 1000, Santa Monica, CA 90405 (and/or, if by facsimile,
(310) 899-4967); and (ii) to the Company at Radnor Financial Center, Suite 300,
150 Radnor Chester Road, Radnor, Pennsylvania 19087, Attention: Michael T.
Kennedy (Fax: (610) 995-2697), with a copy to Duane Morris LLP, 30 South 17th
Street, Philadelphia, Pennsylvania 19103-4196, Attention: Thomas G. Spencer
(Fax: (215) 979-1020); or at such other address as any such party may
subsequently designate by written notice to the other party.

(f) Remedies. In the event of any default hereunder, the non-defaulting party
may proceed to protect and enforce its rights either by suit in equity and/or by
action at law, including but not limited to an action for damages as a result of
any such default, and/or an action for specific performance for any default
where Warrantholder will not have an adequate remedy at law and where damages
will not be readily ascertainable. The Company expressly agrees that it shall
not oppose an application by the Warrantholder or any other person entitled to
the benefit of this Warrant Agreement requiring specific performance of any or
all provisions hereof or enjoining the Company from continuing to commit any
such breach of this Warrant Agreement.

 

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(g) No Impairment of Rights. The Company will not, by amendment of its Charter
or through any other means, avoid or seek to avoid the observance or performance
of any of the terms of this Warrant, but will at all times in good faith assist
in the carrying out of all such terms and in the taking of all such actions as
may be necessary or appropriate in order to protect the rights of the
Warrantholder against impairment. The foregoing notwithstanding, the Company
shall not be deemed to have impaired the Warrantholder’s rights hereunder if it
amends its Charter, or the holders of the Voting Common Stock waive rights
thereunder, in a manner that does not affect the Warrantholder in a manner
different from the effect that such amendments or waivers have on the rights of
the holders of the Voting Common Stock.

(h) Survival. The representations, warranties, covenants and conditions of the
respective parties contained herein or made pursuant to this Warrant Agreement
shall survive the execution and delivery of this Warrant Agreement.

(i) Severability. In the event any one or more of the provisions of this Warrant
Agreement shall for any reason be held invalid, illegal or unenforceable, the
remaining provisions of this Warrant Agreement shall be unimpaired, and the
invalid, illegal or unenforceable provision shall be replaced by a mutually
acceptable valid, legal and enforceable provision, which comes closest to the
intention of the parties underlying the invalid, illegal or unenforceable
provision.

(j) Amendments. Any provision of this Warrant Agreement may be amended or waived
by a written instrument signed by the Company and by the Warrantholder, except
as may otherwise be provided in the Purchase Agreement.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Warrant Agreement to be
executed by its officers thereunto duly authorized as of the Effective Date.

 

  COMPANY:

  RADNOR HOLDINGS CORPORATION   By:  

/s/ Michael T. Kennedy

  Title:   President and CEO

  WARRANTHOLDER:

  SPECIAL VALUE OPPORTUNITIES FUND, LLC   By:  

/s/ José Feliciano

  Title:   Authorized Signatory

[Signature Page to Warrant]

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EXHIBITS OMITTED

[Signature Page to Warrant]