Exhibit 4.1

     FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT AND TO AMENDED
                         AND RESTATED PLEDGE AGREEMENT


     This FIRST  AMENDMENT  TO AMENDED  AND  RESTATED  CREDIT  AGREEMENT  AND TO
AMENDED  AND  RESTATED  PLEDGE  AGREEMENT  dated as of  November  15, 2002 (this
"Amendment"),  is by and among AKI, INC., a Delaware  corporation  ("Borrower"),
HELLER FINANCIAL,  INC., a Delaware  corporation  ("Agent"),  in its capacity as
Agent for the benefit of all Lenders and  individually as a Lender,  and each of
the other  Lenders  signatories  hereto,  and each of the other  Persons who are
parties  hereto  (individually,  a  "Loan  Party"  and  collectively  the  "Loan
Parties").

                                R E C I T A L S:

     A.  Borrower,  Agent and Lenders are  parties to that  certain  Amended and
Restated  Credit  Agreement  dated as of December 18, 2001 (as the same has been
and hereafter may be amended, restated,  supplemented or otherwise modified from
time to time, the "Credit Agreement").

     B.  Borrower  and Agent are parties to that  certain  Amended and  Restated
Pledge  Agreement  dated as of  December  18, 2001 (as the same has been and may
hereafter be amended, restated,  supplemented or otherwise modified from time to
time, the "Pledge Agreement")

     C. Borrower,  Agent and Lenders wish to amend the Credit  Agreement and the
Pledge Agreement as provided herein.

     NOW, THEREFORE, the parties agree as follows:

     1. Definitions.  Capitalized terms used in this Amendment, unless otherwise
defined  herein,  shall have the  meanings  ascribed to such terms in the Credit
Agreement.

     2.  Amendments  to the Credit  Agreement.  The Credit  Agreement  is hereby
amended as follows:

     (a). the first  sentence of  subsection  1.5(B) of the Credit  Agreement is
hereby deleted and the following language is hereby substituted therefor:

     "Within  one hundred  (100) days after the end of each of its fiscal  years
     commencing with the fiscal year ended June 30, 2004,  Borrower shall prepay
     the Term Loan in an amount equal to (i) fifty  percent  (50%) of the Excess
     Cash Flow for such fiscal year, if the Total  Indebtedness  to EBITDA Ratio
     for the trailing  twelve month period ending on the last day of such fiscal
     year is less than 3.50,  or (ii)  seventy-five  percent (75%) of the Excess
     Cash Flow for such fiscal year, if the Total  Indebtedness  to EBITDA Ratio
     for the trailing  twelve month period ending on the last day of such fiscal
     year is greater than or equal to 3.50.";


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     (b). subsection 3.5(H)(iv) of the Credit Agreement is hereby deleted in its
entirety and the following language is hereby substituted therefor:

     "(iv) the  aggregate  cost  of  all  purchases  or  repurchases  after  the
     Restatement  Effective  Date pursuant to this clause (H) of subsection  3.5
     shall not exceed $25,000,000; and"; and

     (c).  the  term  "$250,000"  appearing  in  subsection  3.8 of  the  Credit
Agreement is hereby  deleted in its entirety and the term  "$400,000"  is hereby
substituted therefor; and

     (d).  Schedules  5.4(A) and 5.4(B) to the Credit  Agreement are hereby both
deleted in their entirety and Schedules  5.4(A) and 5.4(B)  attached  hereto and
made a part hereof are hereby substituted therefor, respectively.

     3. Amendments to Pledge  Agreement.  The Pledge Agreement is hereby amended
as follows:

     (a). the first "WHEREAS" clause appearing  therein is hereby deleted in its
entirety and the following language is hereby substituted therefor:

     "WHEREAS,  Pledgor is the legal and  beneficial  owner of all of the issued
     and outstanding capital stock of Encapsulation Services, Inc., a New Jersey
     corporation  ("Encapsulation")  and  IST,  Corp.,  a  Delaware  corporation
     ("IST";  IST and Encapsulation are hereinafter  referred to individually as
     the "Company" and collectively as the  "Companies"),  all of which stock is
     described on Exhibit A hereto; and"; and

     (b).  Exhibit A thereof is hereby  deleted in its  entirety  and  Exhibit A
attached hereto and made a part hereof is hereby substituted therefor.

     4.  Representations  and  Warranties.  To induce  Agent to enter  into this
Amendment, Borrower represents and warrants to Lender that:

     (a). the execution,  delivery and performance by Borrower of this Amendment
are within its  corporate  power,  have been duly  authorized  by all  necessary
corporate  action  and do not and  will  not  contravene  or  conflict  with any
provision of law applicable to Borrower,  the  Certificate of  Incorporation  or
Bylaws  of  Borrower,  or any  order,  judgment  or decree of any court or other
agency of government or any contractual obligation binding upon Borrower;

     (b).  the Credit  Agreement  as amended as of the date hereof is the legal,
valid and  binding  obligation  of  Borrower  enforceable  against  Borrower  in
accordance with its terms;

     (c). each of the  representations  and warranties set forth in Section 5 of
the Credit Agreement  (other that those which, by their terms,  specifically are
made as of a certain  date prior to the date hereof) are true and correct in all
material respects as of the date hereof; and


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     (d). no Default or Event of Default has occurred and is continuing.

     5. Conditions. The effectiveness of the amendments stated in this Amendment
is subject to each of the following conditions precedent or concurrent:

     (a). no Default or Event of Default under the Credit Agreement,  as amended
hereby, shall have occurred and be continuing;

     (b).  Borrower and each other Loan Party shall have  executed and delivered
this  Amendment and such other  documents and  instruments  as Agent may require
shall have been executed and/or delivered to Agent;

     (c).   Agent  shall  have  received  in  immediately   available   funds  a
fully-earned, nonrefundable amendment fee in an amount equal to $37,500;

     (d).  Agent shall have received at least:  (i) four (4) original,  executed
versions of the  Irrevocable  Proxy  Coupled With  Interest,  a form of which is
attached  hereto as Annex A and (ii) one  original,  undated  and  executed  (in
blank) version of the stock power,  a form of which is attached  hereto as Annex
B; and

     (e). all legal matters  incident to this Amendment shall be satisfactory to
Agent and its legal counsel.

     6. Miscellaneous.

     (a). Captions.  Section captions used in this Amendment are for convenience
only, and shall not affect the construction of this Amendment.

     (b).  Governing  Law.  This  Amendment  shall be a contract  made under and
governed  by the laws of the State of  Illinois,  without  regard to conflict of
laws  principles.  Whenever  possible each provision of this Amendment  shall be
interpreted  in such manner as to be effective and valid under  applicable  law,
but if any provision of this  Amendment  shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such  prohibition
or  invalidity,  without  invalidating  the  remainder of such  provision or the
remaining provisions of this Amendment.

     (c).  Counterparts.  This  Amendment  may  be  executed  in any  number  of
counterparts,  and each such counterpart shall be deemed to be an original,  but
all such counterparts shall together constituted but one and the same Amendment.

     (d). Successors and Assigns. This Amendment shall be binding upon Borrower,
each other Loan Party,  each Lender,  Agent and their respective  successors and
assigns, and shall inure to the sole benefit of Borrower, each other Loan Party,
each Lender, Agent and their respective successors and assigns.

     (e).  References.  Any reference to the Credit  Agreement  contained in any
notice,  request,  certificate,  or other document executed concurrently with or
after the  execution


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and delivery of this Amendment shall be deemed to include this Amendment  unless
the context shall otherwise require.

     (f). Continued Effectiveness.  The Credit Agreement, as amended hereby, and
each of the other Loan Documents, remain in full force and effect.

     (g). Costs,  Expenses and Taxes. Borrower affirms and acknowledges that the
terms of subsection  1.3(E) of the Credit  Agreement apply to this Amendment and
the transactions, agreements and documents contemplated hereunder and hereby.

     7.  References.  Any  reference  to the Credit  Agreement  contained in any
document,  instrument  or  agreement  executed  in  connection  with the  Credit
Agreement shall be deemed to be a reference to the Credit  Agreement as modified
by this Amendment.

     8. Ratification. The terms and provisions set forth in this Amendment shall
modify  and  supersede  all  inconsistent  terms and  provisions  of the  Credit
Agreement and shall not be deemed to be a consent to the  modification or waiver
of any other term or  condition  of the Credit  Agreement.  Except as  expressly
modified and  superseded  by this  Amendment,  the terms and  provisions  of the
Credit Agreement are ratified and confirmed and shall continue in full force and
effect.

     9.  Reaffirmation.  Each of the Loan Parties as debtor,  grantor,  pledgor,
guarantor,  assignor,  or in other any other similar capacity in which such Loan
Party  grants liens or security  interests in its property or otherwise  acts as
accommodation  party or  guarantor,  as the case may be, hereby (i) ratifies and
reaffirms  all  of  its  payment  and  performance  obligations,  contingent  or
otherwise, under each of the Loan Documents to which it is a party (after giving
effect  hereto)  and (ii) to the  extent  such Loan  Party  granted  liens on or
security  interests in any of its property pursuant to any such Loan Document as
security for or otherwise  guaranteed the Borrower's  Obligations  under or with
respect to the Loan  Documents,  ratifies and reaffirms such guarantee and grant
of security  interests  and liens and  confirms  and agrees  that such  security
interests and liens  hereafter  secure all of the Obligations as amended hereby.
Each of the Loan Parties hereby consents to this Amendment and acknowledges that
each of the Loan  Documents  remains  in full  force  and  effect  and is hereby
ratified and reaffirmed.  The execution of this Amendment shall not operate as a
waiver of any  right,  power or remedy of the  Agent or  Lenders,  constitute  a
waiver  of any  provision  of any of the Loan  Documents  or  serve to  effect a
novation of the Obligations.

     10.  Ratification of Liability;  Acknowledgment of Rights.  Each Loan Party
hereby  ratifies  and  confirms  its  respective  liabilities,  obligations  and
agreements under the Credit Agreement and the other Loan Documents and the liens
and security  interests  created thereby,  and acknowledges  that: (i) it has no
defenses,  claims or set-offs to the  enforcement by the Lenders or the Agent of
such  liabilities,  obligations and  agreements;  (ii) the Lenders and the Agent
have fully  performed  all  undertakings  owed to it as of the date hereof;  and
(iii) the  Lenders  and the Agent do not  waive,  diminish  or limit any term or
condition  contained in the Credit  Agreement (as amended  hereby) or, in any of
the other Loan Documents.

                 - Remainder of Page Intentionally Left Blank -
                            [Signature Page Follows]


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     IN WITNESS  WHEREOF,  this  Amendment has been duly executed as of the date
first written above.


BORROWER:                              AKI, INC., a Delaware corporation
--------
                                       By:  /s/ Kenneth A. Budde
                                           ------------------------------------
                                       Name:   Kenneth A. Budde
                                       Title:  Chief Financial Officer


AGENT AND LENDER:                      HELLER FINANCIAL, INC., a Delaware
----------------                       corporation, as Agent and as a Lender

                                       By:  /s/ Susan K. Staub
                                            -----------------------------------
                                       Name:   Susan K. Staub
                                       Title:  Vice President

OTHER LOAN PARTIES:
------------------

AKI HOLDING CORP., a Delaware
corporation

By:  /s/ Kenneth A. Budde
     -----------------------------
Name:   Kenneth A. Budde
Title:  Chief Financial Officer


IST, CORP., a Delaware corporation

By:  /s/ Kenneth A. Budde
     -----------------------------
Name:   Kenneth A. Budde
Title:  Chief Financial Officer


ENCAPSULATION SERVICES, INC., a
New Jersey corporation

By:  /s/ Kenneth A. Budde
     -----------------------------
Name:   Kenneth A. Budde
Title:  Chief Financial Officer