<PAGE>

                                                                    EXHIBIT 4.11

THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE SECURITIES LAWS. THIS DEBENTURE MAY NOT BE OFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OF THE DEBENTURE UNDER SUCH ACT
AND UNDER ANY APPLICABLE STATE SECURITIES LAWS, UNLESS THE ISSUER HEREOF IS
SATISFIED THAT SUCH REGISTRATION IS NOT REQUIRED AS TO SUCH SALE OR OFFER.

THIS DEBENTURE IS SUBJECT TO THE TERMS OF SUBORDINATION SET FORTH IN SECTION 4
HEREOF.


               AMENDED AND RESTATED SENIOR SUBORDINATED DEBENTURE

                  THIS AMENDED AND RESTATED SENIOR SUBORDINATED DEBENTURE (the
"AMENDED AND RESTATED DEBENTURE") is made as of this 20th day of November, 2002
by and among: (i) BLUE RHINO CORPORATION, a Delaware corporation (the
"COMPANY"), (ii) USA LEASING, L.L.C., a Delaware limited liability company,
RHINO SERVICES, L.L.C., a Delaware limited liability company, CPD ASSOCIATES,
INC., a North Carolina corporation, QUICKSHIP, INC., a Delaware corporation,
UNIFLAME CORPORATION, a Delaware corporation, BLUE RHINO CONSUMER PRODUCTS, LLC,
a Delaware limited liability company and UNIFLAME, LLC, a Delaware limited
liability company (collectively with the Company, the "BORROWERS"), (iii) ALLIED
CAPITAL CORPORATION, a Maryland corporation (the "HOLDER").

                                    RECITALS

                  A. Pursuant to an Investment Agreement dated as of June 15,
2001 (the "EXISTING INVESTMENT AGREEMENT") by and among the Borrowers and the
Holder, the Holder purchased senior subordinated debentures (the "ORIGINAL
DEBENTURES") in the aggregate principal amount of $15,000,000.

                  B. The Existing Investment Agreement is being amended as of
November 20, 2002 by the First Amendment to Investment Agreement (the "FIRST
AMENDMENT") (the Existing Investment Agreement, as amended by the First
Amendment and as may be further amended from time to time, is herein referred to
as the "INVESTMENT AGREEMENT").

                  C. In connection with the First Amendment, the Borrowers and
the Holder have agreed to amend certain terms and conditions of the Investment
Agreement and to amend and restate the Original Debentures.

                  Now, therefore, in consideration of the foregoing and other
good and valuable consideration, the parties agree that the Original Debenture
shall be amended, restated, and consolidated in its entirety by this Amended and
Restated Debenture.



<PAGE>


                           AMENDED AND RESTATED SENIOR
                             SUBORDINATED DEBENTURE


$15,000,000                                                        June 15, 2001

                  FOR VALUE RECEIVED, the undersigned, (i) BLUE RHINO
CORPORATION a Delaware corporation (the "COMPANY"), (ii) USA LEASING, L.L.C., a
Delaware limited liability company, RHINO SERVICES, L.L.C., a Delaware limited
liability company, CPD ASSOCIATES, INC., a North Carolina corporation,
QUICKSHIP, INC., a Delaware corporation, UNIFLAME CORPORATION, a Delaware
corporation, BLUE RHINO CONSUMER PRODUCTS, LLC, a Delaware limited liability
company and UNIFLAME, LLC, a Delaware limited liability company (collectively
with the Company, the "BORROWERS") jointly and severally promise to pay to the
order of ALLIED CAPITAL CORPORATION, a Maryland corporation (the "HOLDER"), the
principal sum of FIFTEEN MILLION DOLLARS ($15,000,000), together with interest
thereon as set forth below, at its offices or such other place as the Holder may
designate in writing.

         1. Investment Agreement. This Amended and Restated Senior Subordinated
Debenture (the "DEBENTURE") amends and restates the Senior Subordinated
Debenture executed and delivered by the Borrowers at the Closing in connection
with an investment (the "INVESTMENT") made by the Holder in the Borrowers,
pursuant to the terms and conditions of an Investment Agreement by and among the
Borrowers and the Holder, dated of even date herewith (, as amended the
"INVESTMENT AGREEMENT"). This Debenture is subject to the terms and conditions
of the Investment Agreement. A copy of the Investment Agreement may be examined
during normal business hours at the offices of the Company. Any capitalized term
used herein and not otherwise defined herein shall have the meaning assigned to
it in the Investment Agreement.

         2. Interest Rate Provisions.

                  2.1 Interest. Except as provided in Section 4.2.2 hereof, from
the date hereof and thereafter until the repayment of this Debenture in full,
interest shall accrue on the principal balance of this Debenture outstanding
from time to time at the fixed rate of 13% per annum.

                  2.2 Default Interest Rate. If (i) the Borrowers shall default
in the payment when due of the principal of or interest on this Debenture or any
other amount becoming due hereunder, by acceleration or otherwise, or under any
other Loan Document to which any Borrower is a party or (ii) any other Default
or Event of Default exists under Section .12 of the Investment Agreement, in
each case whether or not such default is declared, the interest rate on this
Debenture shall each increase to 17% per annum.

                  2.3 Calculation of Interest. Interest shall be calculated on
the basis of a 360-day year assuming 12 equal 30 day months and shall be
computed for each payment period on the principal balance for the actual number
of days outstanding.



                                       2
<PAGE>

         3. Payment Provisions. The following payment provisions are subject to
Section hereof.

                  3.1 Interest Payments. Commencing on August 1, 2001, and
continuing on each succeeding November 1, February 1, May 1 and August 1
thereafter, up to and including the Maturity Date (each such date, a "PAYMENT
DATE"), the Borrowers shall pay in cash to the Holder quarterly installments of
interest only (in arrears) on the then outstanding principal balance under this
Debenture.

                  3.2 Principal Payments and Payment at Maturity. On the
Maturity Date, the entire then outstanding principal balance of this Debenture,
together with all accrued but unpaid interest, and all other sums owed hereunder
shall be due and payable in full in cash without further notice or demand.

                  3.3 Prepayments; Application of Payments.

                           (a) The Borrowers may prepay the then outstanding
principal amount of this Debenture in whole or in part at any time, so long as
if such prepayment occurs prior to the date of the third anniversary hereof, the
Borrowers pay to the Holder a prepayment premium (the "PREPAYMENT PREMIUM") as
defined in and calculated in accordance with Section 2.6 of the Investment
Agreement along with such prepayment. The Prepayment Premium shall be due
whether this Debenture is due upon voluntary or mandatory prepayment of this
Debenture in whole or in party. No Prepayment Premium shall be due or payable
with respect to any prepayment that occurs after June 15, 2004.

                           (b) Each prepayment with respect to this Debenture
shall be made in increments of $500,000 and shall be applied in the following
order of priority: (i) first, to any Prepayment Premium due pursuant to Section
2.6 of the Investment Agreement; (ii) second, to accrued, but unpaid, interest
at the applicable rate; and (iii) finally, to the then outstanding principal
balance of the Debenture.

                  3.4 Mandatory Prepayment of the Debenture.

                           (a) Election Requiring Borrowers to Prepay Debenture.
Upon a Change of Control, the Holder shall have the right (but not the
obligation) to require the Borrowers to (a) prepay this Debenture for an amount
equal to the then outstanding principal balance, all accrued but unpaid interest
thereon and all Prepayment Premiums and (b) pay all of the other Obligations in
full (the "MANDATORY PREPAYMENT PRICE"), which amount shall be calculated on the
date of the prepayment and be payable in cash on such date.

                           (b) Procedure for Mandatory Prepayment. At least 30
days but no more than 60 days prior to a Change of Control, the Company shall
provide written notice ("Notice of Transfer") to the Holder setting forth the
event constituting the Change of Control and the date of such event. Upon
receipt of the Notice of Transfer, the Holder shall have 30 days during which it
may elect to require the Borrowers to prepay this Debenture. If the Holder
elects to require the Borrowers to prepay this Debenture, it shall provide
written notice ("Notice of



                                       3
<PAGE>

Prepayment") to the Borrowers of its election to do so within the 30-day period
after its receipt of the Notice of Transfer. The Borrowers shall pay the
Mandatory Prepayment Price on the date of the Change of Control.

         4. Subordination. The indebtedness represented by this Debenture is
subordinate to the Senior Debt of the Borrowers in accordance with the terms
hereof.

                  4.1 Definitions. Capitalized terms used but not otherwise
defined herein shall have the following meanings:

                  Collection Action shall mean, with respect to the Junior Debt
         (a) to sue for, take or receive from or on behalf of any Borrower or
         any guarantor of the Junior Debt, by set-off or in any other manner,
         the whole or any part of any moneys which may now or hereafter be owing
         by any Borrower or any such guarantor with respect to the Junior Debt,
         (b) to initiate or participate with others in any suit, action or
         Proceeding against any Borrower or any such guarantor (including any
         right to sue the Borrower or to file or participate in the filing of
         any involuntary bankruptcy petition against such Borrower) to (i)
         enforce payment of or to collect the whole or any part of the Junior
         Debt or (ii) commence judicial enforcement of any of the rights and
         remedies under the Junior Debt Documents or applicable law with respect
         to the Junior Debt, (c) to exercise any put option or to cause any
         Borrower or any such guarantor to honor any redemption or mandatory
         prepayment obligation with respect to the Junior Debt or the Warrants
         or any capital stock of the Company obtained upon exercise of the
         Warrants or (d) to take any action to realize upon any collateral
         securing the Junior Debt (if any) or to exercise any other right or
         remedy with respect to such collateral.

                  Junior Debt shall mean all of the obligations of the Borrowers
         to Holder evidenced by this Debenture and all other amounts now or
         hereafter owed by the Borrowers to Holder under any of the Junior Debt
         Documents.

                  Junior Debt Documents shall mean this Debenture, the
         Investment Agreement, Warrants and any guaranty with respect to the
         Junior Debt and all other documents, agreements and instruments
         executed and delivered in connection therewith.

                  Junior Default shall mean a default in the payment of the
         Junior Debt or in the performance of any term, covenant or condition
         contained in the Junior Debt Documents or any other occurrence
         permitting Holder to accelerate the payment of all or any portion of
         the Junior Debt.

                  Junior Default Notice shall mean a written notice from Holder
         or the Company to holders of Senior Debt pursuant to which such holders
         are notified of the occurrence of a Junior Default, which notice
         incorporates a reasonably detailed description of such Junior Default.

                  Reorganization Subordinated Securities shall mean any notes,
         other del securities, or equity securities issued in a Proceeding in
         substitution of all or any portion of the



                                       4
<PAGE>

         Junior Debt, in each case that are subordinated in right of payment,
         performance or otherwise to the Senior Debt (or any notes or other
         securities issued in substitution c all or any portion of the Senior
         Debt) to at least the same extent that the Junior Debt is subordinated
         to the Senior Debt pursuant to the terms hereof.

                  Proceeding shall mean any voluntary or involuntary insolvency,
         bankruptcy receivership, custodianship, liquidation, dissolution,
         reorganization, assignment for the benefit of creditors, appointment of
         a custodian, receiver, trustee or other officer with similar powers or
         any other proceeding for the liquidation, dissolution or other winding
         up of a person or entity.

                  Senior Acceleration shall mean acceleration of the
         indebtedness due under the Senior Debt Documents.

                  Senior Credit Facility means that certain Credit Agreement, by
         and among the Company, Bank of America, N.A., as Administrative Agent
         Swing Line Lender and Letter of Credit Issuer, and the other lenders
         party thereto, dated as of November 20, 2002, as the same may be
         amended, supplemented or otherwise modified from time to time and any
         agreement or agreements renewing, replacing, restating or refinancing
         all or any of the debt or commitments thereunder or any notes or
         agreements otherwise evidencing any Senior Debt, but only in each case
         to the extent the Indebtedness thereunder continues to constitute
         Senior Debt as provided in the definition thereof.

                  Senior Covenant Default shall mean any default or event of
         default with respect to the financial covenants or the negative
         covenants in the Senior Credit Facility, which default or event of
         default entitles the holders of Senior Debt to accelerate the maturity
         of the Senior Debt.

                  Senior Debt means all of the following: (a) the aggregate
         principal indebtedness advanced from time to time under the Senior
         Credit Facility up to a maximum aggregate principal amount that shall
         not exceed $60,000,000 (as reduced by all payments and prepayments of
         principal outstanding under term loans made under such Senior Credit
         Facility and by the permanent reduction of the revolving credit
         facilities established under such Senior Credit Facility, (b) all
         interest accrued and accruing on the aggregate principal outstanding
         under the Senior Credit Facility from time to time (including, without
         limitation, any interest accruing after the filing of any petition in
         bankruptcy, or the commencement of any insolvency, reorganization or
         like proceeding relating to any Credit Party, whether or not a claim
         for post-filing or post-petition interest is allowed in such
         proceeding); (c) all other reasonable fees or monetary obligations owed
         under the Senior Credit Facility; and (d) all reasonable costs incurred
         by the Senior Lenders under the Senior Credit Facility in commencing or
         pursuing any enforcement action(s) with respect to the amounts
         described in clauses (a) through (c), including attorneys' fees and
         disbursements. "Senior Debt" shall also include all amendments,
         modifications, renewals, replacements, restatements and refinancings of
         the foregoing, in whole or in pa provided such amendments,
         modifications, renewals, replacements, restatements refinancings do not
         (i) increase the interest rate or default rate payable on any component


                                       5
<PAGE>
         thereof by more than 2% over the interest rate or default rate,
         respectively, that is applicable thereto on the date hereof, (ii)
         extend the final maturity of the Senior Debt beyond August 1, 2006,
         (iii) provide for any annual principal amortization payment in excess
         of the Permitted Annual Amortization Amount, (iv) include additional
         financial covenants or amend any of the financial covenants set forth
         in the Senior Credit Facility to render such covenants more
         restrictive, other than additional financial covenant identical to
         those set forth in Section 6.12 of the Investment Agreement that are no
         more than 15% more restrictive as such financial covenants or (v) amend
         any provisions set forth in the Senior Credit Facility which expressly
         permit the prepayment of the Junior Debt to render such provisions more
         restrictive.

                  Senior Debt Documents shall mean the Senior Credit Facility
         and all other documents, agreements and instruments evidencing or
         pertaining to all or any portion of the Senior Debt.

                  Senior Default shall mean any Senior Payment Default or Senior
         Covenant Default.

                  Senior Default Notice shall mean a written notice from the
         holders of Senior Debt to Holder pursuant to which Holder is notified
         of the occurrence of a Senior Default, which notice incorporates a
         reasonably detailed description of such Senior Default.

                  Senior Payment Default shall mean any failure by the Borrowers
         to make any required payment of interest or principal, or any other
         monetary payment, under the Senior Debt Documents, which failure
         continues beyond the expiration of any applicable cure period provided
         by the terms of the Senior Debt Documents, including, without
         limitation, any default in payment of Senior Debt after acceleration
         thereof.

                  Warrant means, collectively, the warrants to purchase
         1,372,071 shares of Common Stock of the Company (as adjusted in
         accordance with the terms thereof), issued in accordance with the
         Investment Agreement.

                  4.2 Subordination.

                           4.2.1 Subordination of Junior Debt to Senior Debt.
Each of the Borrowers covenants and agrees, and Holder by its acceptance of this
Debenture (whether upon original issue or upon transfer or assignment) likewise
covenants and agrees, that (a) the payment of any and all of the Junior Debt
shall be subordinate and subject in right of payment, to the extent and in the
manner hereinafter set forth, to the prior payment in full in cash of the Senior
Debt and (b) the existing and hereafter acquired liens and security interests of
any holder of Senior Debt in any collateral securing all or any portion of the
Senior Debt shall be senior, regardless of the time or method of perfection, to
all existing and hereafter acquired liens security interests, if any, of Holder
(or any agent therefor) in the collateral, if any, securing all or any portion
of the Junior Debt. The Company shall provide to Holder notice of each holder of
Senior Debt upon the incurrence of Senior Debt from such holder, which notice
shall include the name, address and phone number of such holder, and Holder
shall promptly acknowledge in writing receipt of



                                       6
<PAGE>
such notice. Each holder of Senior Debt, whether now outstanding or hereafter
created, incurred, assumed or guaranteed, shall be deemed to have acquired
Senior Debt in reliance upon the provisions contained herein. This Section 4
shall constitute a continuing offer to all Persons who, in reliance upon such
provisions, become holders or, or continue to hold Senior Debt, and such
provisions are made for the benefit of the holders of the Senior Debt, and such
holders are made obligees hereunder and any one or more of them may enforce such
provisions.

                           4.2.2 Proceedings.

                           (a) Payments. In the event of any Proceeding
involving any Borrower, (i) all Senior Debt first shall be paid in full in cash
before any payment of or with respect to the Junior Debt from such Borrower
shall be made (other than a distribution of Reorganization Subordinated
Securities which Holder is hereby specifically authorized to receive and
retain); (ii) any payment or distribution, whether in cash, property or
securities which, but for the terms hereof, otherwise would be payable or
deliverable in respect of the Junior Debt from such Borrower (other than a
distribution of Reorganization Subordinated Securities which Holder is hereby
specifically authorized to receive and retain), shall be paid or delivered
directly to holders of Senior Debt (pro rata to such holders) (to be held and/or
applied thereby in accordance with the terms of the Senior Debt Documents) until
all Senior Debt is paid in full, in cash, and Holder irrevocably authorizes,
empowers and directs all receivers, trustees, liquidators custodians,
conservators and others having authority in the premises to effect all such
payments and distributions, and Holder also irrevocably authorizes, empowers and
directs holders of Senior Debt to demand, sue for, collect and receive every
such payment or distribution; and (iii) Holder agrees to execute and deliver to
each holder of Senior Debt of which Holder has notice or its representative all
such further instruments confirming the authorization referred to in the
foregoing clause (ii).

                           (b) Voting and Other Matters. At any meeting of
creditors or in the event of any Proceeding involving any Borrower, Holder shall
retain the right to vote, file a proof of claim and otherwise act with respect
to the Junior Debt (including the right to vote to accept or reject any plan of
partial or complete liquidation, reorganization, arrangement, composition, or
extension), provided that Holder shall not initiate or prosecute any claim or
action in such Proceeding challenging the enforceability of the Senior Debt,
this Section 4, or any liens and security interests securing the Senior Debt. In
the event Holder fails to execute, verify, deliver and file any proofs of claim
in respect of the Junior Debt in connection with any such Proceeding prior to 15
days before the expiration of the time to file any such proof or fails to vote
any such claim in any such Proceeding prior to 5 days before the expiration of
the time to vote any such claim, Holder hereby irrevocably authorizes, empowers
and appoints the holders of Senior Debt its agent and attorney-in-fact to
execute, verify, deliver and file such proofs of claim and vote such claim in
any such Proceeding; provided the holders of Senior Debt shall have no
obligation to exercise any such authority with respect to Holder's claim. In the
event that the holders of Senior Debt vote any claim in accordance with the
authority granted hereby Holder shall not be entitled to change or withdraw such
vote.

                           (c) Reinstatement. The Senior Debt shall continue to
be treated as Senior Debt and the provisions hereof shall continue to govern the
relative rights and priorities of



                                       7
<PAGE>

holders of Senior Debt and Holder even if all or part of the Senior Debt or the
security interests securing the Senior Debt are subordinated, set aside, avoided
or disallowed in connection with any such Proceeding. This Section 4 shall be
reinstated if at any time any payment of any of the Senior Debt is rescinded or
must otherwise be returned by any holder of Senior Debt or any representative of
such holder.

                           4.2.3 Payment Upon Senior Default.

                           (a) Commencement of Payment Blockage. Subject to
Section 4.2.3(b), the Borrowers may not make and Holder may not receive any
payment with respect to this Debenture or any other Junior Debt Document
(whether as a result of a Collection Action or otherwise) if, at the time of
such payment:

                                    (i) A Senior Payment Default exists and such
                           Senior Payment Default shall not have been cured or
                           waived in accordance with the terms of the Senior
                           Debt Documents;

                                    (ii) The Company and Holder shall have
                           received a Senior Default Notice from the holders of
                           Senior Debt stating that a Senior Covenant Default
                           exists; or

                                    (iii) the holders of Senior Debt have
                           accelerated such Senior Debt.

                           (b) Termination of Payment Blockage. The Borrowers
may resume payments (and may make any payments missed due to the application of
Section 4.2.3(a)) in respect of the Junior Debt or any judgment with respect
thereto:

                                    (i) In the case of a Senior Payment Default
                           referred to in Section 4.2.3(a)(i), upon a cure or
                           waiver thereof in accordance with the terms of the
                           Senior Debt Documents;

                                    (ii) In the case of a Senior Covenant
                           Default referred to in Section 4.2.3(a)(ii), upon the
                           earlier to occur of (x) the cure or waiver of all
                           Senior Covenant Defaults referenced in the applicable
                           Senior Default Notice in accordance with the terms of
                           the Senior Debt Documents, or (y) the expiration of a
                           period of 180 days from the date such Senior Default
                           Notice was received by Holder; or

                                    (iii) In the case of acceleration of the
                           Senior Debt, upon the earlier to occur of (y) the
                           indefeasible satisfaction in full of the Senior Debt
                           and the termination of all lending commitments under
                           the Senior Debt Documents, and (z) any modification
                           of the Senior Debt Documents by which the
                           acceleration is rescinded and the indebtedness is
                           reinstated and no longer immediately due and payable
                           in full.



                                       8
<PAGE>

                           (c) Limitation on Payment Blockages. Notwithstanding
any provision of this Section 4.2.3 to the contrary:

                                    (i) The Borrowers shall not be prohibited
                           from making and Holder shall not be prohibited from
                           receiving, payments under Section 4.2.3(a)(ii) (x) on
                           more than one occasion within any period of 365
                           consecutive days and (y) on more than an aggregate of
                           four occasions so long as this Debenture is
                           outstanding; and

                                    (ii) No Senior Covenant Default existing on
                           the date a Senior Default Notice is given pursuant to
                           Section 4.2.3 shall be used as a basis for any
                           subsequent Senior Default Notice unless such default
                           has been cured or waived for a period of at least 90
                           days.

                           (d) Non-Applicability to Proceeding. The provisions
of this Section 4.2.3 shall not apply to any payment with respect to which
Section 4.2.2 would be applicable.

                           4.2.4 Payments Otherwise Permitted. The failure of
the Borrowers to make any payment with respect to the Junior Debt by reason of
the operation of Section 4.2.3 shall not be construed as preventing the
occurrence of a Junior Default under the applicable Junior Debt Documents.
Nothing contained in this Section 4.2 or elsewhere herein or in the Junior Debt
Documents shall prevent the Borrowers at any time, except during the pendency of
any Proceeding referred to in Section 4.2.2 or under the conditions referred to
in Section 4.2.3 from making payments or prevent Holder from receiving payments
or exercising any remedy available to Holder under the Junior Debt documents at
any time on account of the principal, interest or other charges with respect to
the Junior Debt.

                           4.2.5 Restriction on Collection Action by Holder.
Upon any event of default under the Junior Debt Documents, and after fifteen
days prior written notice to holders of Senior Debt of which Holder has notice,
Holder may accelerate the Junior Debt. Notwithstanding any such acceleration or
any default under the Junior Debt Documents, until the Senior Debt is
indefeasibly paid in full in cash and all lending commitments under the Senior
Debt Documents have been terminated, Holder shall not, without the prior written
consent of the holders of a majority in principal amount of the Senior Debt,
take any Collection Action with respect to the Junior Debt, except as permitted
in the following sentence or Section 4.2.2 hereof Upon the earliest to occur of:

                           (a) the passage of 180 days from the delivery of a
Junior Debt Notice to the holders of Senior Debt of which Holder has notice if
any Junior Default described therein shall not have been cured or waived within
such period; or

                           (b) acceleration of the Senior Debt; or

                           (c) the occurrence of any Proceeding with respect to
any Borrower or its assets; or



                                       9
<PAGE>

                           (d) the commencement by any holder of the Senior Debt
of any judicial or non judicial action or proceeding against any Borrower or any
guarantor of the Senior Debt to (i) enforce payment of or to collect the whole
or any part of the Senior Debt, (ii) enforce any of the rights and remedies
available to any holder of the Senior Debt with respect to the Senior Debt or
any collateral securing the Senior Debt, or (iii) realize upon any of the
collateral securing the Senior Debt or exercise any other right or remedy with
respect to such collateral; or

                           (e) the occurrence of any Senior Default or Junior
Default arising from the merger, sale, liquidation, dissolution, or change of
control of any Borrower,

Holder may, upon ten days prior written notice to the holders of Senior Debt of
which Holder has notice, take any Collection Action. Such ten day notice may be
given during the 180 day period described in clause (a) above. Notwithstanding
the foregoing, Holder may vote, file proofs of claim and otherwise act with
respect to the Junior Debt in any Proceeding involving any Borrower or its
assets to the extent otherwise permitted by Section 4.2.2. Any amount received
by Holder as a result of any Collection Action with respect to the Junior Debt
prior to the indefeasible satisfaction of the Senior Debt in full in cash and
termination of all lending commitments under the Senior Debt Documents will be
paid to the holders of Senior Debt (pro rata to such holders) to the extent
required by the provisions of Section 4.2.8 hereof.

                           4.2.6 Prepayments. Except as expressly permitted
under Section 8.14(b) of the Senior Credit Facility (or as expressly permitted
by any replacements thereof), which are expressly permitted hereby, the
Borrowers shall not be entitled to make, or Holder be entitled to demand, take,
receive, or retain, any prepayments of interest or principal on account of any
of the Junior Debt prior to the indefeasible payment in full in cash of the
Senior Debt and the termination of all lending commitments under the Senior Debt
Documents. Payments received by Holder after acceleration of the Junior Debt or
the commencement of a Collection Action otherwise permitted hereby shall not
constitute a prohibited prepayment under this Section 4.2.6.

                           4.2.7 Amendment of Junior Debt Documents. Until the
Senior Debt is paid in full in cash and notwithstanding anything contained in
the Junior Debt Documents, the Senior Credit Facility or any of the other Senior
Debt Documents to the contrary, Holder shall not, without the prior written
consent of the holders of a majority in principal amount of the Senior Debt,
agree to any amendment, modification or supplement to the Junior Debt Documents
the effect of which is to (i) increase the maximum principal amount of the
Junior Debt or rate of interest on any of the Junior Debt, (ii) change any date
upon which payments of principal or interest on the Junior Debt are due to an
earlier date, (iii) add or make more restrictive any event of default or any
covenant with respect to the Junior Debt, (iv) change any redemption or
prepayment provisions of the Junior Debt to an earlier date or add any
additional events requiring such redemption or prepayment, (v) alter the
subordination provisions with respect to the Junior Debt, including, without
limitation, subordinating the Junior Debt to any other debt, (vi) take any liens
or security interests in assets of any Borrower or any other assets securing the
Senior Debt (other than such liens or security interests, if any, that exist in
favor of Holder as of the date hereof and are otherwise permitted by the Senior
Debt Documents ), (viii) change or amend any other term of the Junior Debt
Documents if such change or amendment would result in a Senior



                                       10
<PAGE>

Default or (ix) permit the exercise of the put rights of Holder under Section
3.2 of the Investor Rights Agreement prior to the fifth anniversary of the date
thereof.

                           4.2.8 Incorrect Payments and Proceeds of Collection
Action. If the Holder receives, prior to the indefeasible satisfaction of the
Senior Debt in full in cash and termination of all lending commitments under the
Senior Debt Documents, any payment or distribution on account of the Junior Debt
not permitted hereby (whether received as a result of a Collection Action or
otherwise), such payment or distribution shall be held in trust by Holder for
the benefit of all holders of Senior Debt and shall be promptly paid over to the
holders of Senior Debt (pro rata to such holders), or their designated
representatives, for application (in accordance with the Senior Debt Documents)
to the payment of the Senior Debt then remaining unpaid, until indefeasible
satisfaction of the Senior Debt in full in cash and termination of all lending
commitments under the Senior Debt Documents.

                           4.2.9 Sale Transfer, etc. Holder shall not sell,
assign, pledge, dispose of or otherwise transfer all or any portion of the
Junior Debt or any Junior Debt Document (a) without giving prior written notice
of such action to the holders of Senior Debt, and (b) unless prior to the
consummation of any such action, the transferee thereof shall execute and
deliver to the holders of Senior Debt of which the transferee or Holder has
notice an agreement providing for the continued subordination and forbearance of
the Junior Debt to the Senior Debt as provided herein and for the continued
effectiveness of all of the rights of the holders of the Senior Debt arising
hereunder. Notwithstanding the failure to execute or deliver any such agreement,
the subordination effected hereby shall survive any sale, assignment, pledge,
disposition or other transfer of all or any portion of the Junior Debt, and the
terms hereof shall be binding upon the successors and assigns of Holder.

                  4.3 Modifications to Senior Debt. The holders of Senior Debt
may at any time and from time to time without the consent of or notice to
Holder, without incurring liability to Holder and without impairing or releasing
the obligations of Holder hereunder, change the manner or place of payment or
extend the time of payment of or renew or alter any of the terms of the Senior
Debt, or amend in any manner any agreement, note, guaranty or other instrument
evidencing or securing or otherwise relating to the Senior Debt; provided that
the Junior Debt shall not be subordinated in accordance herewith to indebtedness
or obligations to the extent such indebtedness or obligations do not constitute
"Senior Debt" under the definition set forth in Section 4.1 hereof.

                  4.4 Continued Effectiveness. The terms hereof, the
subordination effected hereby, and the rights and the obligations of Holder, the
Borrowers, any holders of the Senior Debt arising hereunder shall not be
affected, modified or impaired in any manner or to any extent by the validity or
enforceability of any of the Senior Debt Documents or the Junior Debt Documents,
or any exercise or non-exercise of any right, power or remedy under or in
respect of the Senior Debt or the Senior Debt Documents or the Junior Debt or
the Junior Debt Documents. The Holder and each other holder of Junior Debt
hereby acknowledges that the provisions hereof are intended to be enforceable at
all times, whether before the commencement of, after the commencement of, in
connection with or premised on the occurrence of a Proceeding.



                                       11
<PAGE>

                  4.5 No Contest by Holder. Holder agrees that it will not at
any time contest the validity, perfection, priority or enforceability of the
Senior Debt, the Senior Debt Documents or the liens and security interests of
any holders of the Senior Debt in any collateral securing the Senior Debt.

                  4.6 Representations and Warranties. The original Holder of
this Debenture hereby represents and warrants to the holders of Senior Debt as
follows:

                           4.6.1 Existence and Power. Holder is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Maryland.

                           4.6.2 Authority. Holder has the power and authority
to enter into, execute, deliver and carry out the terms hereof, all of which
have been duly authorized by all proper and necessary action and are not
prohibited by its organizational documents.

                           4.6.3 Binding Agreements. This Debenture constitutes
the valid and legally binding obligation of Holder enforceable in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and by equitable principles.

                           4.6.4 Conflicting Agreements; Litigation. No
provisions of any mortgage, indenture, contract, agreement, statute, rule,
regulation, judgment, decree or order binding on Holder conflicts with, or
requires any consent which has not already been obtained under, or would in any
way prevent the execution, delivery or performance of the terms hereof by
Holder. The execution, delivery and carrying out of the terms hereof will not
constitute a default under, or result in the creation or imposition of, or
obligation to create, any lien or security interest in the property of Holder
pursuant to the terms of any such mortgage, indenture, contract or agreement. No
pending or, to the best of Holder's knowledge, threatened, litigation,
arbitration or other proceedings if adversely determined would in any way
prevent the performance of the terms hereof by Holder.

                           4.6.5 No Divestiture. Holder is the sole owner,
beneficially and of record, of this Debenture and the Junior Debt.

                           4.6.6 Default under Junior Note. No Junior Default
exists under or with respect to this Debenture or any of the other Junior Debt
Documents.

                  4.7 Junior Default Notice. The Company shall provide the
holders of Senior Debt with a Junior Default Notice upon the occurrence of each
Junior Default, and shall notify such holders in the event such Junior Default
is cured or waived.

                  4.8 Cumulative Rights, No Waivers. Each and every right,
remedy and power granted to any holder of the Senior Debt hereunder shall be
cumulative and in addition to any other rights remedy or power specifically
granted herein or the Senior Debt Documents or now or hereafter existing in
equity, at law, by virtue of statute or otherwise, and may be exercised by any
holder of Senior Debt, from time to time, concurrently or independently and as
often and in such



                                       12
<PAGE>

order as such holder may deem expedient. Any failure or delay on the part of the
holder of Senior Debt in exercising any such right, remedy or power, or
abandonment or discontinuance of steps to enforce the same, shall not operate as
a waiver thereof or affect the rights of such holder thereafter to exercise the
same, and any single or partial exercise of any such right, remedy or power
shall not preclude any other or further exercise thereof or the exercise of any
other right, remedy or power, and no such failure, delay, abandonment or single
or partial exercise of the rights of such holder hereunder shall be deemed to
establish a custom or course of dealing or performance among the parties hereto.

                  4.9 Modification. Any modification or waiver of any provision
hereof, or any consent to any departure by Holder therefrom, shall not be
effective in any event unless the same is in writing and signed by the holders
of a majority in principal amount of the outstanding Senior Debt, and then such
modification, waiver or consent shall be effective only in the specific instance
and for the specific purpose given. Any notice or demand given to Holder by any
holder of Senior Debt in any circumstances not specifically required by such
holder hereunder shall not entitle Holder to any other or further notice or
demand in the same, similar or other circumstances unless specifically required
hereunder.

                  4.10 Additional Documents and Actions. Holder at any time, and
from time to time, after the execution and delivery hereof, promptly will
execute and deliver such further documents and do such further acts and things
as the holders of Senior Debt reasonably may request that may be necessary in
order to effect fully the purposes hereof.

                  4.11 Notices. Unless otherwise specifically provided herein,
any notice or other communication required or permitted to be given shall be in
writing addressed to the respective party at the address provided by such party
to the Company and may be personally served, telecopied or sent by overnight
courier service or certified or registered United States mail and shall be
deemed to have been given (a) if delivered in person, when delivered; (b) if
delivered by telecopy, on the date of transmission if transmitted on a Business
Day before 4:00 p.m. (Eastern time) or, if not, on the next succeeding Business
Day; (c) if delivered by overnight courier, two Business Days after delivery to
such courier properly addressed; or (d) if by United States mail, four Business
Days after deposit in the United States mall, postage prepaid and properly
addressed.

                  4.12 Defines Rights of Creditors; Obligations Unconditional.
The provisions of this Section 4 are solely for the purpose of defining the
relative rights of Holder and the holders of Senior Debt and shall not be deemed
to create any rights or priorities in favor of any other Person, including,
without limitation, the Borrowers. As between the Borrowers and Holder, nothing
contained herein shall impair the unconditional and absolute obligation of the
Borrowers to Holder to pay the Junior Debt as such Junior Debt shall become due
and payable in accordance with the Junior Debt Documents.

                  4.13 Subrogation. After the indefeasible payment in full in
cash of the Senior Debt and the termination of all lending commitments under the
Senior Debt Documents, and prior to repayment in full of the Junior Debt, Holder
shall be subrogated to the rights of the holders of Senior Debt to the extent
that distributions otherwise payable to Holder have been



                                       13
<PAGE>

applied to the Senior Debt in accordance with the provisions of this Section 4.
For purposes of such subrogation, no payments or distributions to the holders of
Senior Debt of any cash, property or securities to which Holder would be
entitled except for the provisions of this Section 4, and no payments pursuant
to the provisions of this Section 4 to the holders of Senior Debt by Holder,
shall, as among the Borrowers, their creditors (other than the holders of Senior
Debt), any guarantors of the Senior Debt or Junior Debt, and Holder be deemed to
be a payment of distribution by the Borrowers or such guarantor to or on account
of the Senior Debt. The holders of Senior Debt shall have no obligation or duty
to protect Holder's rights of subrogation arising pursuant to this Section 4 or
under any applicable law, nor shall such holders be liable for any loss to, or
impairment of, any subrogation rights held by the Holder

                  4.14 Conflict. In the event of any conflict between any term,
covenant or condition of this Section 4 and any term, covenant or condition of
any of the Junior Debt Documents, the provisions of this Section 4 shall control
and govern.

                  4.15 WAIVER OF JURY TRIAL. HOLDER, THE BORROWERS AND THE
HOLDERS OF SENIOR DEBT HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS SECTION 4. EACH
OF HOLDER, THE BORROWERS AND THE HOLDERS OF SENIOR DEBT ACKNOWLEDGES THAT THIS
WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH
HAS RELIED ON THE WAIVER IN ENTERING INTO THIS SECTION 4 AND THAT EACH WILL
CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH OF HOLDER,
BORROWER AND HOLDERS OF SENIOR DEBT WARRANTS AND REPRESENTS THAT EACH HAS HAD
THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

                  4.16 Reliance. Upon any payment or distribution of assets of
the Company or any guarantor of the Junior Debt or Senior Debt in connection
with any Proceeding with respect thereto, Holder shall be entitled to rely upon
any order or decree by any court of competent jurisdiction in which such
Proceeding is pending, delivered to Holder, purporting to enforce or interpret
this Section 4 for the purpose of ascertaining the holders of Senior Debt
entitled to participate in such payment or distribution in accordance with this
Section 4, the amount thereof, and all other matters related thereto. Holder
shall not at any time be charged with knowledge of the existence of any facts
which would prohibit the making of any payment to it, unless and until Holder
shall have received written notice thereof in accordance with this Section 4
from the Company or the holders of Senior Debt, and prior to the receipt of any
such written notice Holder shall be entitled to assume conclusively that no such
facts exist, without, however limiting the rights of the holders of Senior Debt
to recover from Holder, or the obligation of Holder to turn over to the holders
of Senior Debt, any payment or distribution made to Holder to which Holder is
not entitled in accordance with this Section 4.

         5. Assignment. This Debenture and the obligations hereunder may not be
assigned by the Borrowers without the prior written consent of the Holder.



                                       14
<PAGE>

         6. Default and Remedies. The occurrence of an Event of Default under
the Investment Agreement shall constitute a default hereunder and shall entitle
the Holder to exercise the rights and remedies specified in the Investment
Agreement, as well as those available at law or in equity.

         7. Waivers. Each of the Borrowers hereby waives presentment, demand,
protest, or further notice of any kind (except such notices as may be
specifically required by the express terms of the Investment Agreement).

         8. Controlling Law. This Debenture and all matters related hereto shall
be governed, construed and interpreted strictly in accordance with the laws of
the State of Maryland, without regard to its principles of conflicts of law.

         9. No Usury. This Debenture is subject to the express condition that at
no time shall the Borrowers be obligated or required to pay interest hereunder
at a rate which could subject the Holder to either civil or criminal liability
as a result of being in excess of the maximum rate which the Borrowers are
permitted by law to contract or agree to pay. If, by the terms of this
Debenture, the Borrowers are at any time required or obligated to pay interest
at a rate in excess of such maximum rate, the rate of interest under this
Debenture shall be deemed to be immediately reduced to such maximum rate and
interest payable hereunder shall be computed at such maximum rate and the
portion of all prior interest payments in excess of such maximum rate shall be
applied and shall be deemed to have been payments in reduction of the principal
balance of this Debenture.

         10. No Novation. All of the terms, covenants and conditions of the
Original Debenture shall continue, except as specifically amended and restated
hereby. This Amended and Restated Debenture does not extinguish the outstanding
indebtedness and is not intended to be a substitution or novation of the
original indebtedness or instruments evidencing the same, all of which shall
continue in full force and effect except as specifically amended and restated
hereby or by instruments executed concurrently herewith.



                            [Signatures on next page]



                                       15
<PAGE>

                  IN WITNESS WHEREOF, the undersigned has caused this Amended
and Restated Debenture to be executed and its seal affixed on the day and year
first above written.


                                  BLUE RHINO CORPORATION

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Executive Vice President

                                  USA LEASING, L.L.C.
                                  By:      Blue Rhino Corporation, as Manager

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Executive Vice President and
                                           Chief Financial Office

                                  RHINO SERVICES, L.L.C.
                                  By:      Blue Rhino Corporation, as Manager

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Executive Vice President and
                                           Chief Financial Office

                                  CPD ASSOCIATES, INC.

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Vice President

                                  QUICKSHIP, INC.

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:  Mark Castaneda
                                           Title:  Asst. Secretary/Treasurer

                                  UNIFLAME CORPORATION


                                  By:  /s/ Kurt Gehsmann     (SEAL)
                                       ----------------------------
                                           Name:    Kurt Gehsmann
                                           Title:   Vice President


                                       16
<PAGE>


                                  BLUE RHINO CONSUMER PRODUCTS, LLC

                                  By:      Blue Rhino Corporation, as Manager


                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Executive Vice President and
                                           Chief Financial Office

                                  UNIFLAME, LLC

                                  By:      Blue Rhino Corporation, as Manager

                                  By:  /s/ Mark Castaneda    (SEAL)
                                       ----------------------------
                                           Name:    Mark Castaneda
                                           Title:   Executive Vice President and
                                           Chief Financial Office





                                       17