Warrant Agreement - Special Value Opportunities Fund LLC



 EXHIBIT 10.28 
 CONFIDENTIAL TREATMENT 
 PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECRETARY OF THE
COMMISSION PURSUANT TO THE REGISTRANT’S APPLICATION OBJECTING TO DISCLOSURE AND REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24b-2; THE OMITTED PORTIONS HAVE BEEN MARKED WITH BRACKETS. 
 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 October 27, 2005 (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, and such purchasers are
entitled to receive warrants to purchase a number of shares equal to at least 6.875%, but not more than 15.625% of the shares outstanding (on a Fully Diluted Basis) as of the date hereof of the Company’s outstanding Voting Common Stock; and

 WHEREAS, 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”): 
 (a) From the date hereof until the Warrant Adjustment Date, thirty-seven
(37) fully paid and non-assessable shares of the Voting Common Stock (the “Initial Share Amount”); 







 (b) On the Warrant Adjustment Date, the Initial Share Amount shall be adjusted upward or downward to a
number of fully paid and non-assessable shares of the Voting Common Stock, at the Exercise Price, equal to the following (the “2006 Adjusted Share Amount”):
[                                        ]

 (c) If the Warrantholder exercises this Warrant at any time prior to the Warrant Adjustment Date, such exercise is for an amount of shares
of Voting Common Stock greater than 6.875% of the Effective Date Voting Common Stock and a downward adjustment is required as set forth in Section 1(b)(i) or (ii) above, then the Warrantholder agrees promptly to return to the Company the
number of shares of Voting Common Stock in excess of the 2006 Adjusted Share Amount (and the Company agrees promptly to return the Exercise Price paid for such returned shares of Voting Common Stock after their return). 
 (d) Notwithstanding the foregoing, if the Company has not delivered its 2006 Audited Financial Statements to the Warrantholder by the Warrant Adjustment
Date, thereafter, the 2006 Adjusted Share Amount shall equal 15.625% of the Effective Date Voting Common Stock. If the Company delivers the 2006 Audited Financial Statements to the Warrantholder prior to June 30, 2007, Section 1(b) will
again be applicable. If the Company fails to deliver the 2006 Audited Financial Statements by the Warrant Adjustment Date, but does deliver such financial statements by June 30, 2007, the Warrantholder shall return to the Company shares of
Voting Common Stock received upon exercise of the Warrant during the Default Period to the extent such shares exceed the 2006 Adjusted Share Amount (and the Company agrees promptly to return the Exercise Price paid for such returned shares of Voting
Common Stock after their return). 
 (e) The number of shares and Exercise Price for such shares set forth in subsections (a), (b) and
(d) above 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 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. 
  

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 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. 
 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. 
  

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 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. 
 (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 

  

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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. 
 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. 
  

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 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. 
 “Capitalized Lease Obligation” means Indebtedness represented by obligations
under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP and the amount of such Indebtedness shall be the capitalized amount of such obligations determined in accordance with GAAP. 
 “Common Stock” shall have the meaning given thereto in Section 3(a) hereof. 
 “Company” shall have the meaning given thereto in the preambles hereof. 
 “Consolidated Interest Expense” means, for any period, the total interest expense of the Company and the Subsidiaries, on a consolidated
basis, plus, to the extent not included in such interest expense, (i) interest expense attributable to Capitalized Lease Obligations, (ii) amortization of debt discount and debt issuance cost, (iii) non-cash interest expense,
(iv) commissions, discounts and other fees and charges owed, in each case, with respect to letters of credit and bankers’ acceptance financing, (v) interest actually paid by the Company or any such Subsidiary under any guarantee of
Indebtedness, (vi) net costs associated with Hedging Obligations (including fees and amortization of discounts), and (vii) preferred stock dividends in respect of all redeemable stock of the Company held by Persons other than the Company
or a Subsidiary (to the extent reflected on the Company’s statement of income or operations for such period). 
 “Consolidated
Net Income” means, for any period, the aggregate net income (loss) of the Company and the Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that (i) the Net Income of any Person that
is not a Subsidiary of the Company but that is consolidated with the Company or a consolidated Subsidiary or is accounted for by the Company or a consolidated Subsidiary by the equity method of accounting shall be included only to the extent of the
amount of cash dividends or cash distributions actually paid to the Company or a consolidated Subsidiary, (ii) all gains and losses that are extraordinary or are either unusual or nonrecurring (including any gain or loss realized upon the
termination of any employee pension benefit plan and any gain or loss from the sale or other disposition of assets other than in the ordinary course of business or from the issuance or sale of any Equity Interests) shall be excluded; and
(iii) the net income from any entity acquired (whether by assets acquisition, merger, share purchase or otherwise) by the Company or any of the consolidated Subsidiaries from the date hereof until December 31, 2006 shall be excluded.

 “Default Period” shall having the meaning given thereto in Section 1(d) hereof. 
 “Effective Date” shall have the meaning given thereto in the heading of this Warrant Agreement. 
 “Effective Date Voting Common Stock” shall mean the Voting Common Stock of the Company outstanding as of the date hereof, calculated on
a Fully Diluted Basis; provided that (i) in the event of any combination, reclassification, exchange or subdivision of or affecting the Voting Common Stock, the Effective Date Voting Common Stock shall thereafter mean such number and
kind of securities as the Effective Date Voting Common Stock would represent upon such combination, reclassification, exchange, subdivision or other change, (ii) upon a Merger Event, the Effective Date Voting Common Stock shall thereafter mean
such number of shares of stock, property, money or other securities of the successor corporation resulting from such Merger Event as the Effective Date Voting Common Stock would represent upon giving effect to such Merger Event, and (iii) in
the event that the Company at any time shall make a distribution or pay a dividend payable in the Company’s Voting Common Stock or any other Capital Stock of the Company, then the Effective Date Voting Common Stock shall thereafter 

  

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mean such number and kind of securities as the Effective Date Voting Common Stock would represent upon payment of such dividend or distribution. 

“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. 
 “Fully Diluted
Basis” means, as of any date of determination, the sum of (a) the number of shares of Voting Common Stock outstanding as of such date of determination plus (b) the number of shares of Voting Common Stock issuable upon the
exercise, conversion or exchange of all then-outstanding warrants, options, or other rights exercisable for, directly or indirectly, shares of Voting Common Stock, whether at the time of issue or upon the passage of time or upon the occurrence of
some future event, and whether or not in the money as of such date of determination; provided that the Voting Common Stock issuable upon conversion of any other class of the Company’s Capital Stock pursuant to the Company’s
Certificate of Incorporation shall not be included in the foregoing calculation. 
 “GAAP” means accounting principles
generally accepted in the United States of America. 
 “Hedging Obligations” means the obligations of any Person or entity
pursuant to any swap or cap agreement, exchange agreement, collar agreement, option, futures or forward hedging contract or other similar agreement or arrangement designed to protect such Person or entity against fluctuations in interest rates.

 “Indebtedness” with respect to any Person means, at any time, without duplication, (i) all liabilities for borrowed
money and its redemption obligations in respect of mandatorily redeemable preferred stock, (ii) all liabilities for the deferred purchase price of property acquired by such Person (excluding accounts payable arising in the ordinary course of
business but including all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property), (iii) all synthetic lease obligations and all liabilities appearing on its balance sheet
in accordance with GAAP in respect of capital leases, (iv) all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for such liabilities);
and (v) all liabilities in respect of letters of credit or instruments serving a similar function issued or accepted for its account by banks and other financial institutions (whether or not representing obligations for borrowed money).
Indebtedness of any Person shall include all obligations of such Person of the character described in clauses (i) through (v) of the foregoing sentence to the extent such Person remains legally liable in respect thereof notwithstanding
that any such obligation is deemed to be extinguished under GAAP. Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture in which such Person is a general partner or a joint venturer, unless such Indebtedness
is, by its terms, non-recourse to the assets of such Person other than as a result of customary exclusions. 
 “Initial Share
Amount” shall have the meaning given thereto in Section 1(a) 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. 
 “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. 
 “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. 
 “Subsidiary”
means, as to any Person, any corporation, association or other business entity in which such Person or one or more of its Subsidiaries or such Person and one or more of its Subsidiaries owns sufficient equity or voting interests to enable it or them
(as a group) ordinarily, in the absence of contingencies, to elect a majority of the directors (or Persons performing similar functions) of such entity, and any partnership or joint venture if more 

  

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than a 50% interest in the profits or capital thereof is owned by such Person or one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries. Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company. 
 “Transfer Notice” shall have the meaning given thereto in Section 10 hereof. 
 “2006 Adjusted Share Amount” shall have the meaning given thereto in Section 1(b) hereof. 
 “2006
Audited Financial Statements” means the audited consolidated financial statements of the Company and its consolidated Subsidiaries for the fiscal year ended December 29, 2006, duly certified by the Chief Financial Officer of the
Company. 
 “2006 EBITDA” means the Consolidated Net Income of the Company and the Subsidiaries for the fiscal year ended
December 29, 2006, plus, without duplication, the following to the extent included in calculating such Consolidated Net Income: (i) Consolidated Interest Expense, (ii) consolidated income tax expense and (iii) consolidated
depreciation and amortization expense. 2006 EBITDA shall be calculated based on the 2006 Audited Financial Statements. 
 “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. 
 “Warrant Adjustment Date” means the
earlier of (i) the date that the Company delivers the 2006 Audited Financial Statements to the Warrantholder (which delivery shall be deemed to have occurred upon the Company’s filing of an annual report on Form 10-K containing the 2006
Audited Financial Statements with the United States Securities and Exchange Commission), and (ii) March 31, 2007. 
 “Warrantholder” shall have the meaning given thereto in Section 1 hereof. 
 (b) Capitalized terms used but
not defined herein shall have the respective meanings given thereto in the Purchase Agreement. 
 13. 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) 566-1010); 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 

  

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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. 
 (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/ David Hollander

		 		 		 	 Title:
	 	 Authorized Person


  

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