Document:

<PAGE>

                                                                    Exhibit 10.1

                               Trex Company, Inc.
                                TREX Company, LLC

                                U.S. $40,000,000

                  8.32% Senior Secured Notes due June 19, 2009

                                 ---------------

                             Note Purchase Agreement

                               ------------------

                            Dated as of June 19, 2002

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                 Page
<S>                                                                                                              <C>
Section 1         Notes.........................................................................................    1

         Section 1.1.      Authorization of Notes...............................................................    1
         Section 1.2.      Additional Series of Notes...........................................................    1

Section 2         Sale And Purchase Of Notes....................................................................    1

Section 3         Closing.......................................................................................    2

Section 4         Conditions To Closing.........................................................................    2

         Section 4.1.      Representations and Warranties.......................................................    2
         Section 4.2.      Performance; No Default..............................................................    2
         Section 4.3.      Compliance Certificates..............................................................    2
         Section 4.4.      Opinions of Counsel..................................................................    3
         Section 4.5.      Purchase Permitted By Applicable Law, Etc............................................    3
         Section 4.6.      Sale of Other Notes..................................................................    3
         Section 4.7.      Payment of Special Counsel Fee.......................................................    3
         Section 4.8.      Private Placement Number.............................................................    3
         Section 4.9.      Changes in Corporate Structure.......................................................    3
         Section 4.10.     Execution of Collateral Documents....................................................    4
         Section 4.11.     Related Transactions.................................................................    4
         Section 4.12.     Filing and Recording.................................................................    4
         Section 4.13.     Funding Instructions.................................................................    4
         Section 4.14.     Payment of Recording Fees, Charges and Taxes.........................................    4
         Section 4.15.     Proceedings and Documents............................................................    4

Section 5         Representations And Warranties Of The Company.................................................    5

         Section 5.1.      Organization; Power and Authority....................................................    5
         Section 5.2.      Authorization, Etc...................................................................    5
         Section 5.3.      Disclosure...........................................................................    5
         Section 5.4.      Organization and Ownership of Shares of Subsidiaries; Affiliates.....................    6
         Section 5.5.      Financial Statements; Financial Projections..........................................    7
         Section 5.6.      Compliance with Laws, Other Instruments, Etc.........................................    7
         Section 5.7.      Governmental Authorizations, Etc.....................................................    7
         Section 5.8.      Litigation; Observance of Agreements, Statutes and Orders............................    7
         Section 5.9.      Taxes................................................................................    8
         Section 5.10.     Title to Property; Leases............................................................    8
         Section 5.11.     Licenses, Permits, Etc...............................................................    8
         Section 5.12.     Compliance with ERISA................................................................    9
         Section 5.13.     Private Offering by the Company......................................................    9
         Section 5.14.     Use of Proceeds; Margin Regulations..................................................    9
         Section 5.15.     Existing Debt; Future Liens..........................................................   10
         Section 5.16.     Foreign Assets Control Regulations, Etc..............................................   10
         Section 5.17.     Status under Certain Statutes........................................................   10
</TABLE>

                                      -i-

<PAGE>

                                TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
                                                                                                                 Page
<S>                                                                                                              <C>
         Section 5.18.     Environmental Matters................................................................   10
         Section 5.19.     Solvency of Company..................................................................   11

Section 6         Representations Of The Purchaser..............................................................   11

         Section 6.1.      Purchase for Investment..............................................................   11
         Section 6.2.      Source of Funds......................................................................   12

Section 7         Information As To Company.....................................................................   13

         Section 7.1.      Financial and Business Information...................................................   13
         Section 7.2.      Officer's Certificate................................................................   15
         Section 7.3.      Inspection...........................................................................   16

Section 8         Prepayment Of The Notes.......................................................................   16

         Section 8.1.      Required Prepayments.................................................................   16
         Section 8.2.      Optional Prepayments with Make-Whole Amount..........................................   17
         Section 8.3.      Change in Control....................................................................   17
         Section 8.4.      Allocation of Partial Prepayments....................................................   19
         Section 8.5.      Maturity; Surrender, Etc.............................................................   19
         Section 8.6.      Purchase of Notes....................................................................   20
         Section 8.7.      Make-Whole Amount....................................................................   20

Section 9         Affirmative Covenants.........................................................................   21

         Section 9.1.      Compliance with Law..................................................................   21
         Section 9.2.      Insurance............................................................................   21
         Section 9.3.      Maintenance of Properties............................................................   22
         Section 9.4.      Payment of Taxes and Claims..........................................................   22
         Section 9.5.      Corporate Existence, Etc.............................................................   22
         Section 9.6.      New Subsidiaries.....................................................................   22

Section 10        Negative Covenants............................................................................   24

         Section 10.1.     Transactions with Affiliates.........................................................   24
         Section 10.2.     Merger, Consolidation, Etc...........................................................   24
         Section 10.3.     Liens................................................................................   25
         Section 10.4.     Consolidated Adjusted Net Worth......................................................   26
         Section 10.5.     Cash Flow Fixed Charge Coverage Ratio................................................   27
         Section 10.6.     Limitations on Funded Debt...........................................................   27
         Section 10.7.     Sale of Assets, Etc..................................................................   27
         Section 10.8.     Line of Business.....................................................................   29

Section 11        Events Of Default.............................................................................   29

Section 12        Remedies On Default, Etc......................................................................   31

         Section 12.1.     Acceleration.........................................................................   31
         Section 12.2.     Other Remedies.......................................................................   32
</TABLE>

                                      -ii-

<PAGE>

                                TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
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<S>                                                                                                              <C>
         Section 12.3.     Rescission...........................................................................   32
         Section 12.4.     No Waivers or Election of Remedies, Expenses, Etc....................................   32

Section 13        Registration; Exchange; Substitution Of Notes.................................................   32

         Section 13.1.     Registration of Notes................................................................   32
         Section 13.2.     Transfer and Exchange of Notes.......................................................   32
         Section 13.3.     Replacement of Notes.................................................................   33

Section 14        Payment Of Notes..............................................................................   33

         Section 14.1.     Place of Payment.....................................................................   33
         Section 14.2.     Home Office Payment..................................................................   33

Section 15        Expenses, Etc.................................................................................   34

         Section 15.1.     Transaction Expenses.................................................................   34
         Section 15.2.     Survival.............................................................................   34

Section 16        Survival Of Representations And Warranties; Entire Agreement..................................   34

Section 17        Amendment And Waiver..........................................................................   35

         Section 17.1.     Requirements.........................................................................   35
         Section 17.2.     Solicitation of Holders of Notes.....................................................   35
         Section 17.3.     Binding Effect, Etc..................................................................   35
         Section 17.4.     Notes Held by Company, Etc...........................................................   36

Section 18        Notices.......................................................................................   36

Section 19        Reproduction of Documents.....................................................................   36

Section 20        Confidential Information......................................................................   37

Section 21        Substitution of Purchaser.....................................................................   37

Section 22        Release of Collateral.........................................................................   38

Section 23        Miscellaneous.................................................................................   39

         Section 23.1.     Successors and Assigns...............................................................   39
         Section 23.2.     Payments Due on Non-Business Days....................................................   39
         Section 23.3.     Severability.........................................................................   39
         Section 23.4.     Construction.........................................................................   39
         Section 23.5.     Counterparts.........................................................................   39
         Section 23.6.     Governing Law........................................................................   39
</TABLE>

                                     -iii-

<PAGE>

SCHEDULES

Schedule A       Information Regarding Purchasers
Schedule B       Defined Terms
Schedule 5.4     Subsidiaries
Schedule 5.5     Financial Statements
Schedule 5.8     Litigation
Schedule 5.11    Licenses and Permits
Schedule 5.15    Existing Debt and Existing Liens

EXHIBITS

Exhibit 1        Form of Note
Exhibit 4.4(a)   Description of Closing Opinion of Counsel to the Company
Exhibit 4.4(b)   Description of Special Counsel's Closing Opinion
Exhibit 4.4(c)   Description of Closing Opinion for Counsel to the Collateral
                 Agent
Exhibit 4.10     Form of Security Agreement

                                      -iv-

<PAGE>

                               TREX COMPANY, INC.
                                TREX COMPANY, LLC
                                160 Exeter Drive
                         Winchester, Virginia 22603-8605

                  8.32% Senior Secured Notes due June 19, 2009

                                                                     Dated as of
                                                                   June 19, 2002

TO EACH OF THE PURCHASERS LISTED IN
         THE ATTACHED SCHEDULE A:

Ladies and Gentlemen:

     Each of Trex Company, Inc., a Delaware corporation (the "Parent"), and TREX
Company, LLC, a Delaware limited liability company ("TREX LLC," the Parent and
TREX LLC are hereinafter sometimes referred to collectively as the "Company"),
jointly and severally agree with you as follows:

SECTION 1  Notes.

     Section 1.1. Authorization of Notes. The Company will authorize the issue
and sale of $40,000,000 aggregate principal amount of its 8.32% Senior Secured
Notes due June 19, 2009 (the "Notes," such term to include any such notes issued
in substitution therefor pursuant to Section 13). The Notes shall be
substantially in the form set out in Exhibit 1, with such changes therefrom, if
any, as may be approved by you, the Other Purchasers, and the Company. Certain
capitalized terms used in this Agreement are defined in Schedule B; references
to a "Schedule" or an "Exhibit" are, unless otherwise specified, to a Schedule
or an Exhibit attached to this Agreement.

     Section 1.2. Additional Series of Notes. The Company may, from time to time
to the extent otherwise permitted by this Agreement, including, without
limitation, upon compliance by the Company with Section 10.6, issue and sell
additional series of their promissory notes ranking pari passu with the Notes in
right of payment and ratably secured and may, in connection with the
documentation thereof, incorporate by reference various provisions of this
Agreement. Such incorporation by reference shall not in any way affect the
rights of the Holders hereunder or under the Notes.

SECTION 2  Sale and Purchase of Notes.

     Subject to the terms and conditions of this Agreement, the Company will
issue and sell to you and each of the other purchasers named in Schedule A (the
"Other Purchasers"), and you and the Other Purchasers will purchase from the
Company, at the Closing provided for in Section

<PAGE>

3, Notes in the principal amount specified opposite your name in Schedule A at
the purchase price of 100% of the principal amount thereof. Your obligation
hereunder and the obligations of the Other Purchasers are several and not joint
obligations and you shall have no liability to any Person for the performance or
non-performance by any Other Purchaser hereunder.

SECTION 3  Closing.

     The sale and purchase of the Notes to be purchased by you and the Other
Purchasers shall occur at the offices of McDermott, Will & Emery, 50 Rockefeller
Plaza, New York, New York 10020, at 10:00 a.m., New York City time, at a closing
(the "Closing") on June 19, 2002 or on such other Business Day thereafter on or
prior to June 28, 2002 as may be agreed upon by the Company and you and the
Other Purchasers. At the Closing the Company will deliver to you the Notes to be
purchased by you in the form of a single Note (or such greater number of Notes
in denominations of at least $1,000,000 as you may request) dated the date of
the Closing and registered in your name (or in the name of your nominee),
against delivery by you to the Company or its order of immediately available
funds in the amount of the purchase price therefor by wire transfer of
immediately available funds for the account of the Company at Bank of America,
N.A., 730 15th Street, NW, Washington, DC 20005, Account Name: Commercial
Settlements, Inc. Escrow Account, Account Number: 00-192-0587013, ABA No.: 054
001 204, Re: Advise David Nelson/CSI File: 020369/TREX. If at the Closing the
Company shall fail to tender such Notes to you as provided above in this Section
3, or any of the conditions specified in Section 4 shall not have been fulfilled
to your satisfaction, you shall, at your election, be relieved of all further
obligations under this Agreement, without thereby waiving any rights you may
have by reason of such failure or such non-fulfillment.

SECTION 4  Conditions to Closing.

     Your obligation to purchase and pay for the Notes to be sold to you at the
Closing is subject to the fulfillment to your satisfaction, prior to or at the
Closing, of the following conditions:

     Section 4.1. Representations and Warranties. The representations and
warranties of the Company in this Agreement shall be correct when made and at
the time of the Closing.

     Section 4.2. Performance; No Default. The Company shall have performed and
complied with all agreements and conditions contained in this Agreement required
to be performed or complied with by it prior to or at the Closing and after
giving effect to the issue and sale of the Notes (and the application of the
proceeds thereof as contemplated by Section 5.14) no Default or Event of Default
shall have occurred and be continuing. Neither the Company nor any Subsidiary
shall have entered into any transaction since the date of the Memorandum that
would have been prohibited by Sections 10.1, 10.3, or 10.6 hereof had such
Sections applied since such date.

     Section 4.3. Compliance Certificates.

             (a) Officer's Certificate. The Company shall have delivered to you
     an Officer's Certificate, dated the date of the Closing, certifying that
     the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

                                      2

<PAGE>

             (b) Secretary's Certificate. The Company shall have delivered to
     you a certificate certifying as to the resolutions attached thereto and
     other corporate and limited liability company, as the case may be,
     proceedings relating to the authorization, execution and delivery of the
     Notes and the Agreements.

     Section 4.4. Opinions of Counsel. You shall have received opinions in form
and substance satisfactory to you, dated the date of the Closing (a) from Hogan
& Hartson, L.L.P., counsel for the Company, covering the matters set forth in
Exhibit 4.4(a) and covering such other matters incident to the transactions
contemplated hereby as you or your counsel may reasonably request (and the
Company hereby instructs its counsel to deliver such opinion to you), (b) from
McDermott, Will & Emery, your special counsel in connection with such
transactions, substantially in the form set forth in Exhibit 4.4(b) and covering
such other matters incident to such transactions as you may reasonably request,
and (c) from counsel to the Collateral Agent substantially in the form set forth
in Exhibit 4.4(c) and covering such matters incident to such transactions as you
may reasonably request.

     Section 4.5. Purchase Permitted By Applicable Law, Etc. On the date of the
Closing your purchase of Notes shall (a) be permitted by the laws and
regulations of each jurisdiction to which you are subject, without recourse to
provisions (such as Section 1405(a)(8) of the New York Insurance Law) permitting
limited investments by insurance companies without restriction as to the
character of the particular investment, (b) not violate any applicable law or
regulation (including, without limitation, Regulation U, T or X of the Board of
Governors of the Federal Reserve System) and (c) not subject you to any tax,
penalty or liability under or pursuant to any applicable law or regulation,
which law or regulation was not in effect on the date hereof. If requested by
you, you shall have received an Officer's Certificate certifying as to such
matters of fact as you may reasonably specify to enable you to determine whether
such purchase is so permitted.

     Section 4.6. Sale of Other Notes. Contemporaneously with the Closing the
Company shall sell to the Other Purchasers and the Other Purchasers shall
purchase the Notes to be purchased by them at the Closing as specified in
Schedule A.

     Section 4.7. Payment of Special Counsel Fees. Without limiting the
provisions of Section 15.1, the Company shall have paid on or before the Closing
the reasonable fees, charges and disbursements of your special counsel referred
to in Section 4.4 to the extent reflected in a statement of such counsel
rendered to the Company at least one Business Day prior to the Closing.

     Section 4.8. Private Placement Number. A Private Placement Number issued by
Standard & Poor's CUSIP Service Bureau (in cooperation with the Securities
Valuation Office of the National Association of Insurance Commissioners) shall
have been obtained for the Notes.

     Section 4.9. Changes in Corporate Structure. The Company shall not have
changed its jurisdiction of incorporation or organization or been a party to any
merger or consolidation and shall not have succeeded to all or any substantial
part of the liabilities of any other entity, at any time following the date of
the most recent financial statements referred to in Schedule 5.5.

                                      3

<PAGE>

     Section 4.10. Execution of Collateral Documents. On or prior to the Closing
Date:

             (a) the Company and the Collateral Agent shall have entered into
     and delivered the Collateral Documents in form and substance satisfactory
     to you and the Collateral Documents shall be in full force and effect and
     you shall have received true, correct and complete copies thereof; and

             (b) the Collateral Agent, the Bank Lender and you shall have
     entered into and delivered the Intercreditor and Collateral Agency
     Agreement dated as of the date hereof ("Intercreditor Agreement") and the
     Company shall have acknowledged the execution and delivery of the
     Intercreditor Agreement and the Intercreditor Agreement shall be in full
     force and effect and you shall have received true, correct and complete
     copies thereof.

     Section 4.11. Related Transactions. On or prior to the Closing:

             (a) the Company shall have consummated the sale of all of the Notes
     scheduled to be sold on the Closing Date pursuant to this Agreement; and

             (b) the Company and the Bank Lender shall have fully executed and
     delivered the Credit Agreement and all conditions to the effectiveness
     thereof shall have been consummated.

     Section 4.12. Filing and Recording. The Collateral Documents (and/or
financing statements or similar notices thereof if and to the extent permitted
by applicable law) shall have been recorded or filed for record in such public
offices as may be deemed necessary or appropriate by you or your special counsel
(or deposited fully completed and executed originals for recording or filing
with an escrow agent in accordance with non-revocable instructions acceptable to
counsel for the Collateral Agent and Holders) in order to perfect the Liens and
security interests granted or conveyed thereby.

     Section 4.13. Funding Instructions. At least three (3) Business Days prior
to the Closing, you shall have received written instructions executed by a
Senior Financial Officer of the Company directing the manner of the payment of
funds and setting forth (a) the name of the transferee bank, (b) such transferee
bank's ABA number, (c) the account name and number into which the purchase price
for the Notes is to be deposited and (d) the name and telephone number of the
account representative responsible for verifying receipt of such funds.

     Section 4.14. Payment of Recording Fees, Charges and Taxes. All fees,
charges and taxes in connection with the recordation or filing and
re-recordation or re-filing of the Collateral Documents and any other agreement
or instrument, financing statement or any publication of notice required to be
filed or recorded to protect the validity of the Liens securing the obligations
of the Notes shall have been paid in full or amounts sufficient to pay the same
shall have been deposited with the title company.

     Section 4.15. Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions shall be
satisfactory to you and your special counsel,

                                      4

<PAGE>

and you and your special counsel shall have received all such counterpart
originals or certified or other copies of such documents as you or they may
reasonably request.

SECTION 5  Representations and Warranties of the Company.

     The Company represents and warrants to you that:

     Section 5.1. Organization; Power and Authority. The Parent is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and is duly qualified as a foreign corporation
and is in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Parent has the
corporate power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement, the Collateral
Documents and the Notes and to perform the provisions hereof and thereof. TREX
LLC is a limited liability company duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, and is duly
qualified as a foreign limited liability company and is in good standing in each
jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. TREX LLC has the limited liability company power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to transact, to
execute and deliver this Agreement, the Collateral Documents and the Notes and
to perform the provisions hereof and thereof.

     Section 5.2. Authorization, Etc. This Agreement, the Collateral Documents
and the Notes have been duly authorized by all necessary corporate and limited
liability company action on the part of the Company, and this Agreement and the
Collateral Documents constitute, and upon execution and delivery thereof each
Note will constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by (a) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (b) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).

     Section 5.3. Disclosure. The Company, through its agent, SPP Capital
Partners, LLC and BB&T Capital Markets, has delivered to you and each Other
Purchaser a copy of a Confidential Private Placement Memorandum dated April 2002
(as amended or supplemented in writing, the "Memorandum"), relating to the
transactions contemplated hereby. The Memorandum fairly describes, in all
material respects, the general nature of the business and principal properties
of the Company and the Subsidiaries. This Agreement, the Collateral Documents,
the Memorandum, the documents, certificates or other writings delivered to you
by or on behalf of the Company in connection with the transactions contemplated
hereby, and the financial statements listed in Schedule 5.5, taken as a whole,
do not contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading in the
light of the circumstances under which they were made; provided that no

                                      5

<PAGE>

representation or warranty in addition to the representations or warranties set
forth in Section 5.5 is made with respect to the financial projections of the
Company and the Subsidiaries for the fiscal year ending December 31, 2002, which
are set forth in the Memorandum under tab number VI. Except as disclosed in the
Memorandum or as expressly described in Schedule 5.5, or in one of the
documents, certificates or other writings identified therein, or in the
financial statements listed in Schedule 5.5, since December 31, 2001, there has
been no change in the financial condition, operations, business, properties or
prospects of the Company or any Subsidiary except changes that individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect. There is no fact known to the Company that could reasonably be expected
to have a Material Adverse Effect that has not been set forth herein or in the
Memorandum or in the other documents, certificates and other writings delivered
to you by or on behalf of the Company specifically for use in connection with
the transactions contemplated hereby.

     Section 5.4. Organization and Ownership of Shares of Subsidiaries;
Affiliates.

          (a) Schedule 5.4 contains (except as noted therein) complete and
correct lists (i) of the Subsidiaries, showing, as to each Subsidiary, the
correct name thereof, the jurisdiction of its organization, and the percentage
of shares of each class of its capital stock or similar equity interests
outstanding owned by the Company and each other Subsidiary, (ii) of the
Affiliates, other than Subsidiaries, controlled by the Company or any Subsidiary
and (iii) of the Company's directors and senior officers.

          (b) All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and nonassessable
and are owned by the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4); provided, however, that with
respect to Trex Wood Polymer Espana, S.L., the foregoing representation shall
only apply to the extent such concepts are applicable under the laws of Spain.

          (c) Each Subsidiary identified in Schedule 5.4 is a corporation or
other legal entity duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified as a foreign
corporation or other legal entity and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. Each such Subsidiary has the corporate or other power and
authority to own or hold under lease the properties it purports to own or hold
under lease and to transact the business it transacts and proposes to transact.

          (d) No Subsidiary is a party to, or otherwise subject to, any legal
restriction or any agreement (other than this Agreement, the agreements listed
on Schedule 5.4 and customary limitations imposed by corporate law or limited
liability company law statutes) restricting the ability of such Subsidiary to
pay dividends out of profits or make any other similar distributions of profits
to the Company or any Subsidiary that owns outstanding shares of capital stock
or similar equity interests of such Subsidiary.

                                      6

<PAGE>

     Section 5.5. Financial Statements; Financial Projections. The Company has
delivered to each Purchaser copies of the consolidated financial statements of
the Company and the Subsidiaries listed on Schedule 5.5. All of such
consolidated financial statements (including in each case the related schedules
and notes) fairly present in all material respects the consolidated financial
position of the Company and its Subsidiaries as of the respective dates
specified in such financial statements and the consolidated results of their
operations and cash flows for the respective periods so specified and have been
prepared in accordance with GAAP consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year-end adjustments and other
adjustments described therein).

     The financial projections for the Company and its Subsidiaries for the
fiscal year ending December 31, 2002 are set forth in the Memorandum under tab
number VI. Such projections were prepared in good faith by the Company and were
based on facts known to the Company on the date such financial projections were
made and on assumptions that were reasonable and consistent with such facts. The
Company has no reason to believe that such forecasts are unreasonable in any
material respect.

     Section 5.6. Compliance with Laws, Other Instruments, Etc. The execution,
delivery and performance by the Company of this Agreement, the Collateral
Documents and the Notes will not (a) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary under, any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, corporate charter or
by-laws, or any other agreement or instrument to which the Company or any
Subsidiary is bound or by which the Company or any Subsidiary or any of their
respective properties may be bound or affected, (b) conflict with or result in a
breach of any of the terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental Authority applicable
to the Company or any Subsidiary or (c) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to the Company
or any Subsidiary.

     Section 5.7. Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement, the Collateral Documents or the Notes,
excluding those registrations and filings required in connection with the
perfection of the Liens created pursuant to the Collateral Documents.

     Section 5.8. Litigation; Observance of Agreements, Statutes and Orders.

          (a) Except as set forth in Schedule 5.8, there are no actions, suits
or proceedings pending or, to the knowledge of the Company, threatened against
or affecting the Company or any Subsidiary or any property of the Company or any
Subsidiary in any court or before any arbitrator of any kind or before or by any
Governmental Authority that, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.

          (b) Neither the Company nor any Subsidiary is in default under any
term of any agreement or instrument to which it is a party or by which it is
bound, or any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority or is in violation

                                      7

<PAGE>

of any applicable law, ordinance, rule or regulation (including, without
limitation, Environmental Laws) of any Governmental Authority, which default or
violation, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.

     Section 5.9.  Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (a) the amount
of which is not individually or in the aggregate Material or (b) the amount,
applicability or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which the Company or a Subsidiary,
as the case may be, has established adequate reserves in accordance with GAAP.
The Company knows of no basis for any other tax or assessment that could
reasonably be expected to have a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company and its Subsidiaries in respect of
Federal, state or other taxes for all fiscal periods are adequate. The Federal
income tax liabilities of the Company and its Subsidiaries have been determined
by the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ended December 31, 2000.

     Section 5.10. Title to Property; Leases. The Company and its Subsidiaries
have good and sufficient title to their respective properties owned by them that
individually or in the aggregate are Material, including all such properties
reflected in the most recent audited balance sheet referred to in Section 5.5 or
purported to have been acquired by the Company or any Subsidiary after the date
of such balance sheet (except as sold or otherwise disposed of in the ordinary
course of business), in each case free and clear of Liens prohibited by this
Agreement. All leases of properties leased to the Company and its Subsidiaries
that individually or in the aggregate are Material are valid and subsisting and
are in full force and effect in all material respects.

     Section 5.11. Licenses, Permits, Etc.

          (a) Except as disclosed in Schedule 5.11 hereto, the Company and its
Subsidiaries own or possess all licenses, permits, franchises, authorizations,
patents, copyrights, service marks, trademarks and trade names, or rights
thereto, that individually or in the aggregate are Material, without known
conflict with the rights of others.

          (b) To the best knowledge of the Company, no product of the Company
infringes in any material respect any license, permit, franchise, authorization,
patent, copyright, service mark, trademark, trade name or other right owned by
any other Person.

          (c) To the best knowledge of the Company, there is no Material
violation by any Person of any right of the Company or any of its Subsidiaries
with respect to any patent, copyright, service mark, trademark, trade name or
other right owned or used by the Company or any of its Subsidiaries.

                                      8

<PAGE>

     Section 5.12. Compliance with ERISA.

          (a) The Company and each ERISA Affiliate have operated and
administered each Plan in compliance with all applicable laws except for such
instances of noncompliance as have not resulted in and could not reasonably be
expected to result in a Material Adverse Effect. Neither the Company nor any
ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA or
the penalty or excise tax provisions of the Code relating to employee benefit
plans (as defined in Section 3 of ERISA), and no event, transaction or condition
has occurred or exists that could reasonably be expected to result in the
incurrence of any such liability by the Company or any ERISA Affiliate, or in
the imposition of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate, in either case pursuant to Title I or IV of
ERISA or to such penalty or excise tax provisions or to Section 401(a)(29) or
412 of the Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.

          (b) The Company has no Plans subject to the minimum funding rules of
Section 412 of the Code.

          (c) The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.

          (d) The expected postretirement benefit obligation (determined as of
the last day of the Company's most recently ended fiscal year in accordance with
Financial Accounting Standards Board Statement No. 106, without regard to
liabilities attributable to continuation coverage mandated by section 4980B of
the Code) of the Company and its Subsidiaries is not Material.

          (e) The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder will not involve any transaction that is subject to
the prohibitions of section 406(a) of ERISA or in connection with which a tax
could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The
representation by the Company in the first sentence of this Section 5.12(e) is
made in reliance upon and subject to the accuracy of your representation in
Section 6.2 as to the sources of the funds used to pay the purchase price of the
Notes to be purchased by you.

     Section 5.13. Private Offering by the Company. Neither the Company nor
anyone acting on its behalf has offered the Notes or any similar securities for
sale to, or solicited any offer to buy any of the Notes or any similar
Securities from, or otherwise approached or negotiated in respect thereof with,
any Person other than you, the Other Purchasers and not more than 43 other
Institutional Investors, each of which has been offered the Notes at a private
sale for investment. Neither the Company nor anyone acting on its behalf has
taken, or will take, any action that would subject the issuance, offering, or
sale of the Notes to the registration requirements of Section 5 of the
Securities Act.

     Section 5.14. Use of Proceeds; Margin Regulations. The Company will apply
the proceeds of the sale of the Notes and proceeds from the facilities available
under the Credit

                                      9

<PAGE>

Agreement to repay in full its existing indebtedness to Wachovia Bank, National
Association and for general corporate purposes. No part of the proceeds from the
sale of the Notes hereunder will be used, directly or indirectly, for the
purpose of buying or carrying any margin stock within the meaning of Regulation
U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for
the purpose of buying or carrying or trading in any securities under such
circumstances as to involve the Company in a violation of Regulation X of such
Board (12 CFR 224) or to involve any broker or dealer in a violation of
Regulation T of such Board (12 CFR 220). Margin stock does not constitute more
than 5% of the value of the consolidated assets of the Company and its
Subsidiaries and the Company does not have any present intention that margin
stock will constitute more than 5% of the value of such consolidated assets. As
used in this Section 5.14, the terms "margin stock" and "purpose of buying or
carrying" shall have the meanings assigned to them in such Regulation U.

     Section 5.15. Existing Debt; Future Liens.

          (a) Schedule 5.15 sets forth a complete and correct list of all
outstanding Debt of the Company and its Subsidiaries as of the Closing. Neither
the Company nor any Subsidiary is in default, and no waiver of default is
currently in effect, in the payment of any principal or interest on any Debt of
the Company or such Subsidiary and no event or condition exists with respect to
any Debt of the Company or any Subsidiary that would permit (or that with notice
or the lapse of time, or both, would permit) one or more Persons to cause such
Debt to become due and payable before its stated maturity or before its
regularly scheduled dates of payment.

          (b) Neither the Company nor any Subsidiary has agreed or consented to
cause or permit in the future (upon the happening of a contingency or otherwise)
any of its property, whether now owned or hereafter acquired, to be subject to a
Lien not permitted by Section 10.3.

     Section 5.16. Foreign Assets Control Regulations, Etc. Neither the sale of
the Notes by the Company hereunder nor its use of the proceeds thereof will
violate the Trading with the Enemy Act, as amended, or any of the foreign assets
control regulations of the United States Treasury Department (31 CFR, Subtitle
B, Chapter V, as amended) or any enabling legislation or executive order
relating thereto.

     Section 5.17. Status under Certain Statutes. Neither the Company nor any
Subsidiary is subject to regulation under the Investment Company Act of 1940, as
amended, the Public Utility Holding Company Act of 1935, as amended, the
Interstate Commerce Act, as amended, or the Federal Power Act, as amended.

     Section 5.18. Environmental Matters. Neither the Company nor any Subsidiary
has knowledge of any claim or has received any notice of any claim, and no
proceeding has been instituted raising any claim, against the Company or any of
its Subsidiaries or any of their respective real properties now or formerly
owned, leased or operated by any of them or other assets, alleging any damage to
the environment or violation of any Environmental Laws, except, in each case,
such as could not reasonably be expected to result in a Material Adverse Effect.
Except as otherwise disclosed to you in writing,

                                      10

<PAGE>

             (a) neither the Company nor any Subsidiary has knowledge of any
     facts which would give rise to any claim, public or private, of violation
     of Environmental Laws or damage to the environment emanating from,
     occurring on or in any way related to real properties now or formerly
     owned, leased or operated by any of them or to other assets or their use,
     except, in each case, such as could not reasonably be expected to result in
     a Material Adverse Effect;

             (b) neither the Company nor any of its Subsidiaries has stored any
     Hazardous Materials on real properties now or formerly owned, leased or
     operated by any of them and has not disposed of any Hazardous Materials in
     a manner contrary to any Environmental Laws in each case in any manner that
     could reasonably be expected to result in a Material Adverse Effect; and

             (c) all buildings on all real properties now owned, leased or
     operated by the Company or any of its Subsidiaries are in compliance with
     applicable Environmental Laws, except where failure to comply could not
     reasonably be expected to result in a Material Adverse Effect.

     Section 5.19. Solvency of Company. After giving effect to the transactions
contemplated herein and after giving due consideration to any rights of
contribution (a) each of the Parent and TREX LLC have received fair
consideration and reasonably equivalent value for the incurrence of its
respective obligations under this Agreement and the Collateral Documents, (b)
the fair value of the assets of each of the Parent and TREX LLC (both at fair
valuation and at present fair saleable value) exceeds its respective
liabilities, (c) each of the Parent and TREX LLC is able to and expects to be
able to pay its respective debts as they mature, and (d) each of the Parent and
TREX LLC has capital sufficient to carry on its business as conducted and as
proposed to be conducted.

SECTION 6  Representations Of The Purchaser.

     Section 6.1. Purchase for Investment. You represent that you are purchasing
the Notes for your own account or for one or more separate accounts maintained
by you or for the account of one or more pension or trust funds and not with a
view to the distribution thereof, provided that the disposition of your or their
property shall at all times be within your or their control. You understand that
the Notes have not been registered under the Securities Act or applicable state
securities laws and may be resold, pledged, transferred, or otherwise disposed
of only if registered pursuant to the provisions of the Securities Act and
applicable state securities laws or if an exemption from such registration is
available, except under circumstances where neither such registration nor such
an exemption is required by the Securities Act or applicable state securities
laws, and that the Company is not required to register the Notes. You represent
that (a) you are an "accredited investor" within the meaning of subparagraph
(a)(1), (2), (3) or (7) of Rule 501 of Regulation D under the Securities Act,
(b) you were not formed for the specific purpose of purchasing the Notes, and
(c) your principal offices and the offices at which you made your decision to
purchase the Notes are located as the address specified opposite your name in
Schedule A.

                                      11

<PAGE>

     Section 6.2. Source of Funds. You represent that at least one of the
following statements is an accurate representation as to each source of funds (a
"Source") to be used by you to pay the purchase price of the Notes to be
purchased by you hereunder:

             (a)  the Source is an "insurance company general account" (as the
     term is defined in Prohibited Transaction Exemption ("PTE") 95-60 (issued
     July 12, 1995)) in respect of which the reserves and liabilities (as
     defined by the annual statement for life insurance companies approved by
     the National Association of Insurance Commissioners (the "NAIC Annual
     Statement")) for the general account contract(s) held by or on behalf of
     any employee benefit plan together with the amount of the reserves and
     liabilities for general account contract(s) held by or on behalf of any
     other employee benefit plans maintained by the same employer (or affiliate
     thereof as defined in PTE 95-60) or by the same employee organization, in
     the general account, do not exceed ten percent (10%) of the total reserves
     and liabilities of the general account (exclusive of separate account
     liabilities) plus surplus, as set forth in the NAIC Annual Statement filed
     with your state of domicile; or

             (b)  the Source is a separate account that is maintained solely in
     connection with such Purchaser's fixed contractual obligations under which
     the amounts payable, or credited, to any employee benefit plan (or its
     related trust) that has any interest in such separate account (or to any
     participant or beneficiary of such plan (including any annuitant)) are not
     affected in any manner by the investment performance of the separate
     account; or

             (c)  the Source is either (i) an insurance company pooled separate
     account, within the meaning of PTE 90-1 (issued January 29, 1990), or (ii)
     a bank collective investment fund, within the meaning of the PTE 91-38
     (issued July 12, 1991) and, except as you have disclosed to the Company in
     writing pursuant to this paragraph (c), no employee benefit plan or group
     of plans maintained by the same employer or employee organization
     beneficially owns more than 10% of all assets allocated to such pooled
     separate account or collective investment fund; or

             (d)  the Source constitutes assets of an "investment fund" (within
     the meaning of Part V of the QPAM Exemption) managed by a "qualified
     professional asset manager" or "QPAM" (within the meaning of Part V of the
     QPAM Exemption), no employee benefit plan's assets that are included in
     such investment fund, when combined with the assets of all other employee
     benefit plans established or maintained by the same employer or by an
     affiliate (within the meaning of Section V(c)(1) of the QPAM Exemption) of
     such employer or by the same employee organization and managed by such
     QPAM, exceed 20% of the total client assets managed by such QPAM, the
     conditions of Part I(c) and (g) of the QPAM Exemption are satisfied,
     neither the QPAM nor a person controlling or controlled by the QPAM
     (applying the definition of "control" in Section V(e) of the QPAM
     Exemption) owns a 5% or more interest in the Company and (i) the identity
     of such QPAM and (ii) the names of all employee benefit plans whose assets
     are included in such investment fund have been disclosed to the Company in
     writing pursuant to this paragraph (d); or

                                      12

<PAGE>

             (e) the Source is a governmental plan; or

             (f) the Source is one or more employee benefit plans, or a separate
     account or trust fund comprised of one or more employee benefit plans, each
     of which has been identified to the Company in writing pursuant to this
     paragraph (f); or

             (g) the Source does not include assets of any employee benefit
     plan, other than a plan exempt from the coverage of ERISA.

     As used in this Section 6.2, the terms "employee benefit plan",
"governmental plan", and "separate account" shall have the respective meanings
assigned to such terms in Section 3 of ERISA.

SECTION 7  Information As To Company.

     Section 7.1. Financial and Business Information. The Company shall deliver
to each holder of Notes that is an Institutional Investor:

             (a)  Quarterly Statements -- within 45 days after the end of each
     quarterly fiscal period in each fiscal year of the Parent (other than the
     last quarterly fiscal period of each such fiscal year), duplicate copies
     of,

                  (i)   a consolidated balance sheet of the Parent and its
             Subsidiaries as at the end of such quarter, and

                  (ii)  consolidated statements of income, and cash flows of the
             Parent and its Subsidiaries, for such quarter and (in the case of
             the second and third quarters) for the portion of the fiscal year
             ending with such quarter,

     setting forth in each case in comparative form the figures for the
     corresponding periods in the previous fiscal year, all in reasonable
     detail, prepared in accordance with GAAP applicable to quarterly financial
     statements generally, and certified by a Senior Financial Officer as fairly
     presenting, in all material respects, the financial position of the
     companies being reported on and their results of operations and cash flows,
     subject to changes resulting from year-end adjustments and other
     adjustments described therein, provided that delivery within the time
     period specified above of copies of the Company's Quarterly Report on Form
     10-Q prepared in compliance with the requirements therefor and filed with
     the Securities and Exchange Commission shall be deemed to satisfy the
     requirements of this Section 7.1(a);

             (b)  Annual Statements -- within 90 days after the end of each
     fiscal year of the Parent, duplicate copies of,

                  (i)   a consolidated balance sheet of the Parent and its
             Subsidiaries, as at the end of such year, and

                  (ii)  consolidated statements of income, changes in
             stockholders' equity and cash flows of the Parent and its
             Subsidiaries, for such year,

                                      13

<PAGE>

     setting forth in each case in comparative form the figures for the previous
     fiscal year, all in reasonable detail, prepared in accordance with GAAP,
     and accompanied by

              (A) an opinion thereon of independent certified public accountants
          of recognized national standing, which opinion shall state that such
          financial statements present fairly, in all material respects, the
          financial position of the companies being reported upon and their
          results of operations and cash flows and have been prepared in
          conformity with GAAP, and that the examination of such accountants in
          connection with such financial statements has been made in accordance
          with generally accepted auditing standards, and that such audit
          provides a reasonable basis for such opinion in the circumstances, and

              (B) a certificate of such accountants stating that they have
          reviewed this Agreement and stating further whether, in making their
          audit, they have become aware of any condition or event that then
          constitutes a Default or an Event of Default, and, if they are aware
          that any such condition or event then exists, specifying the nature
          and period of the existence thereof (it being understood that such
          accountants shall not be liable, directly or indirectly, for any
          failure to obtain knowledge of any such Default or Event of Default
          unless such accountants should have obtained knowledge thereof in
          making an audit in accordance with generally accepted auditing
          standards or did not make such an audit),

     provided that the delivery within the time period specified above of the
     Company's Annual Report on Form 10-K for such fiscal year (together with
     the Company's annual report to shareholders, if any, prepared pursuant to
     Rule 14a-3 under the Exchange Act) prepared in accordance with the
     requirements therefor and filed with the Securities and Exchange
     Commission, together with the accountant's certificate described in clause
     (B) above, shall be deemed to satisfy the requirements of this Section
     7.1(b);

          (c) SEC and Other Reports -- promptly upon their becoming available,
     one copy of (i) each financial statement, report, notice or proxy statement
     sent by the Company or any Subsidiary to public securities holders
     generally, and (ii) each regular or periodic report, each registration
     statement (without exhibits except as expressly requested by such holder of
     the Notes that is an Institutional Investor), and each prospectus and all
     amendments thereto filed by the Company or any Subsidiary with the
     Securities and Exchange Commission and of all press releases and other
     written communications made available generally by the Company or any
     Subsidiary to the public concerning developments that are Material;

          (d) Notice of Default or Event of Default -- promptly, and in any
     event within five Business Days after a Responsible Officer becoming aware
     of the existence of any Default or Event of Default or that any Person has
     given any notice or taken any action with respect to a claimed Default
     hereunder or that any Person has given any notice or taken any action with
     respect to a claimed default of the type referred to in Section 11(f),

                                      14

<PAGE>

     a written notice specifying the nature and period of existence thereof and
     what action the Company is taking or proposes to take with respect thereto;

          (e)  ERISA Matters -- promptly, and in any event within five Business
     Days after a Responsible Officer becoming aware of any of the following, a
     written notice setting forth the nature thereof and the action, if any,
     that the Company or an ERISA Affiliate proposes to take with respect
     thereto:

                  (i)   with respect to any Plan, any reportable event, as
          defined in section 4043(b) of ERISA and the regulations thereunder,
          for which notice thereof has not been waived pursuant to such
          regulations as in effect on the date hereof; or

                  (ii)  the taking by the PBGC of steps to institute, or the
          threatening by the PBGC of the institution of, proceedings under
          section 4042 of ERISA for the termination of, or the appointment of a
          trustee to administer, any Plan, or the receipt by the Company or any
          ERISA Affiliate of a notice from a Multiemployer Plan that such action
          has been taken by the PBGC with respect to such Multiemployer Plan; or

                  (iii) any event, transaction or condition that could result in
          the incurrence of any liability by the Company or any ERISA Affiliate
          pursuant to Title I or IV of ERISA or the penalty or excise tax
          provisions of the Code relating to employee benefit plans, or in the
          imposition of any Lien on any of the rights, properties or assets of
          the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA
          or such penalty or excise tax provisions, if such liability or Lien,
          taken together with any other such liabilities or Liens then existing,
          could reasonably be expected to have a Material Adverse Effect;

          (f)     Notices from Governmental Authority -- promptly, and in any
     event within 30 days of receipt thereof, copies of any notice to the
     Company or any Subsidiary from any Federal or state Governmental Authority
     relating to any order, ruling, statute or other law or regulation that
     could reasonably be expected to have a Material Adverse Effect; and

          (g)     Requested Information -- with reasonable promptness, such
     other data and information relating to the business, operations, affairs,
     financial condition, assets or properties of the Company or any of its
     Subsidiaries or relating to the ability of the Company to perform its
     obligations hereunder and under the Notes as from time to time may be
     reasonably requested by any such holder of Notes that is an Institutional
     Investor.

     Section 7.2. Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to subparagraph (a) or subparagraph (b)
of Section 7.1 shall be accompanied by a certificate of a Senior Financial
Officer of the Parent setting forth:

          (a)     Covenant Compliance -- the information (including detailed
     calculations) required in order to establish whether the Company was in
     compliance with the requirements of Section 10.2 through Section 10.7
     hereof, inclusive, during the quarterly or annual period covered by the
     statements then being furnished (including with respect

                                      15

<PAGE>

     to each such Section, where applicable, the calculations of the maximum or
     minimum amount, ratio or percentage, as the case may be, permissible under
     the terms of such Sections, and the calculation of the amount, ratio or
     percentage then in existence); and

          (b)     Event of Default -- a statement that such Senior Financial
     Officer has reviewed the relevant terms hereof and has made, or caused to
     be made, under his or her supervision, a review of the transactions and
     conditions of the Company and its Subsidiaries from the beginning of the
     quarterly or annual period covered by the statements then being furnished
     to the date of the certificate and that such review shall not have
     disclosed the existence during such period of any condition or event that
     constitutes a Default or an Event of Default or, if any such condition or
     event existed or exists (including, without limitation, any such event or
     condition resulting from the failure of the Company or any Subsidiary to
     comply with any Environmental Law), specifying the nature and period of
     existence thereof and what action the Company shall have taken or proposes
     to take with respect thereto.

     Section 7.3. Inspection. The Company shall permit the representatives of
each holder of Notes that is an Institutional Investor:

          (a)     No Default -- if no Default or Event of Default then exists,
     at the expense of such holder and upon reasonable prior notice to the
     Company, to visit the principal executive office of the Company, to discuss
     the affairs, finances and accounts of the Company and its Subsidiaries with
     the Company's officers, and (with the consent of the Company, which consent
     will not be unreasonably withheld) its independent public accountants, and
     (with the consent of the Company, which consent will not be unreasonably
     withheld) to visit the other offices and properties of the Company and each
     Subsidiary, all at such reasonable times and as often as may be reasonably
     requested in writing; and

          (b)     Default -- if a Default or Event of Default then exists, at
     the expense of the Company, to visit and inspect any of the offices or
     properties of the Company or any Subsidiary, to examine all their
     respective books of account, records, reports and other papers, to make
     copies and extracts therefrom, and to discuss their respective affairs,
     finances and accounts with their respective officers and independent public
     accountants (and by this provision the Company authorizes said accountants
     to discuss the affairs, finances and accounts of the Company and its
     Subsidiaries), all at such times and as often as may be requested.

SECTION 8  Prepayment Of The Notes.

     Section 8.1. Required Prepayments. On June 19, 2005 and on each June 19
thereafter to and including June 19, 2008, the Company will prepay $8,000,000.00
principal amount (or such lesser principal amount as shall then be outstanding)
of the Notes at 100% of the principal amount thereof and without payment of the
Make Whole Amount or any premium, provided that upon any partial prepayment of
the Notes pursuant to Section 8.2 or purchase of the Notes permitted by Section
8.6 the principal amount of each required prepayment of the Notes becoming due
under this Section 8.1 on and after the date of such prepayment or purchase
shall

                                      16

<PAGE>

be reduced in the same proportion as the aggregate unpaid principal amount of
the Notes is reduced as a result of such prepayment or purchase.

     Section 8.2. Optional Prepayments with Make-Whole Amount. The Company may,
at its option, upon notice as provided below, prepay at any time all, or from
time to time any part of, the Notes, in an amount not less than $1,000,000.00 of
the aggregate principal amount of the Notes then outstanding in the case of a
partial prepayment, at 100% of the principal amount so prepaid, together with
interest accrued thereon to the date of such prepayment, plus the Make-Whole
Amount determined for the prepayment date with respect to such principal amount.
The Company will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice shall specify
such date, the aggregate principal amount of the Notes to be prepaid on such
date, the principal amount of each Note held by such holder to be prepaid
(determined in accordance with Section 8.4), and the interest to be paid on the
prepayment date with respect to such principal amount being prepaid, and shall
be accompanied by a certificate of a Senior Financial Officer as to the
estimated Make-Whole Amount due in connection with such prepayment (calculated
as if the date of such notice were the date of the prepayment), setting forth
the details of such computation. Two Business Days prior to such prepayment, the
Company shall deliver to each holder of Notes a certificate of a Senior
Financial Officer specifying the calculation of such Make-Whole Amount as of the
specified prepayment date.

     Section 8.3. Change in Control.

          (a)     Notice of Change in Control or Control Event. The Company
will, within two Business Days after any Responsible Officer has knowledge of
the occurrence of any Change in Control or Control Event, give written notice of
such Change in Control or Control Event to each holder of Notes unless notice in
respect of such Change in Control (or the Change in Control contemplated by such
Control Event) shall have been given pursuant to subparagraph (b) of this
Section 8.3. If a Change in Control has occurred, such notice shall contain and
constitute an offer to purchase Notes as described in subparagraph (c) of this
Section 8.3 and shall be accompanied by the certificate described in
subparagraph (g) of this Section 8.3.

          (b)     Condition to Company Action. The Company will not take any
action that consummates or finalizes a Change in Control unless (i) at least 30
days prior to such action it shall have given to each holder of Notes written
notice containing and constituting an offer to purchase Notes as described in
subparagraph (c) of this Section 8.3, accompanied by the certificate described
in subparagraph (g) of this Section 8.3, and (ii) contemporaneously with such
action, it purchases all Notes required to be purchased in accordance with this
Section 8.3.

          (c)     Offer to Purchase Notes. The offer to purchase Notes
contemplated by subparagraphs (a) and (b) of this Section 8.3 shall be an offer
to purchase, in accordance with and subject to this Section 8.3, all, but not
less than all, of the Notes held by each holder (in this case only, "holder" in
respect of any Note registered in the name of a nominee for a disclosed
beneficial owner shall mean such beneficial owner) on a date specified in such
offer (the "Proposed Purchase Date"). If such Proposed Purchase Date is in
connection with an offer contemplated by subparagraph (a) of this Section 8.3,
such date shall be not less than 30 days

                                      17

<PAGE>

and not more than 60 days after the date of such offer (if the Proposed
Purchase Date shall not be specified in such offer, the Proposed Purchase Date
shall be the 45th day after the date of such offer).

          (d) Acceptance. A holder of Notes may accept or reject in whole or in
part the offer to purchase made pursuant to this Section 8.3 by causing a
written notice of such acceptance or rejection to be delivered to the Company at
least 15 days prior to the Proposed Purchase Date. A failure by a holder of
Notes to respond to an offer to purchase made pursuant to this Section 8.3 shall
be deemed to constitute an acceptance of such offer by such holder.

          (e) Purchase. Purchase of the Notes to be purchased pursuant to this
Section 8.3 shall be at 100% of the principal amount of such Notes, plus the
Make-Whole Amount determined as of the date of purchase with respect to such
principal amount, together with interest on such Notes accrued to the date of
purchase. On the Business Day preceding the date of purchase, the Company shall
deliver to each holder of Notes being purchased a statement showing the
Make-Whole Amount due in connection with such purchase and setting forth the
details of the computation of such amount. The purchase shall be made on the
Proposed Purchase Date.

          (f) Deferral Pending Change in Control. The obligation of the Company
to purchase Notes pursuant to the offers required by subparagraph (b) and
accepted in accordance with subparagraph (d) of this Section 8.3 is subject to
the occurrence of the Change in Control in respect of which such offers and
acceptances shall have been made. In the event that such Change in Control does
not occur on or prior to the Proposed Purchase Date in respect thereof, the
purchase shall be deferred in accordance with the terms and provisions of this
clause (f) until and shall be made on the date on which such Change in Control
occurs. The Company shall keep each holder of Notes reasonably and timely
informed of (i) any such deferral of the date of purchase, (ii) the date on
which such Change in Control and the purchase are expected to occur, and (iii)
any determination by the Company that efforts to effect such Change in Control
have ceased or been abandoned (in which case the offers and acceptances made
pursuant to this Section 8.3 in respect of such Change in Control shall be
deemed rescinded). The deferred purchase of the Notes by the Company pursuant to
this clause (f) is conditioned upon the payment by the Company to the holders
who accept such purchase offer pursuant to this Section 8.3 of all losses,
expenses, liabilities and costs suffered by such holder as a result of the
deferral of such purchase in connection with any hedging contract or position
entered into by such holder in reliance on the determination of the original
Proposed Purchase Date (the "Deferred Payment Hedging Loss"). Such Deferred
Payment Hedging Loss, if any, shall be reasonably determined and established by
such holder and a reasonable explanation of the same shall be communicated to
the Company. Such Deferred Payment Hedging Loss shall be due and payable on the
deferred Proposed Purchase Date. In addition, if such Change in Control is so
deferred, the Company shall recalculate the Make-Whole Amount due in connection
with such Change in Control pursuant to the terms of clause (e) above with
respect to the deferred Proposed Purchase Date.

          (g) Officer's Certificate. Each offer to purchase the Notes pursuant
to this Section 8.3 shall be accompanied by a certificate, executed by a Senior
Financial Officer of the Company and dated the date of such offer, specifying:
(i) the Proposed Purchase Date; (ii) that

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<PAGE>

such offer is made pursuant to this Section 8.3; (iii) the principal amount of
each Note offered to be purchased; (iv) the estimated Make-Whole Amount due in
connection with such purchase (calculated as if the date of such notice were the
date of the purchase) setting forth the details of such computation; (v) the
interest that would be due on each Note offered to be purchased, accrued to the
Proposed Purchase Date; (vi) that the conditions of this Section 8.3 have been
fulfilled; and (vii) in reasonable detail, the nature and date or proposed date
of the Change in Control.

          (h)     Definitions.

     "Change in Control" shall be deemed to have occurred if any "person" (as
such term is used in section 13(d) and section 14(d)(2) of the Exchange Act as
in effect on the date of the Closing) or persons constituting a Group, other
than any one or more of the Management Stockholders, becomes the "beneficial
owner" (as such term is used in Rule 13d-3 under the Exchange Act as in effect
on the date of the Closing), directly or indirectly, of more than 50% of the
total voting power of all classes then outstanding of the Parent's Voting Stock.

     "Control Event" means:

                  (i)   the execution by the Company or any of its Subsidiaries
          or Affiliates of any agreement or letter of intent with respect to any
          proposed transaction or event or series of transactions or events
          which, individually or in the aggregate, may reasonably be expected to
          result in a Change of Control,

                  (ii)  the execution of any written agreement which, when fully
          performed by the parties thereto, would result in a Change in Control,
          or

                  (iii) the making of any written offer by any "person" (as such
          term is used in section 13(d) and section 14(d)(2) of the Exchange Act
          as in effect on the date of the Closing) or persons constituting a
          Group to the holders of the common stock of the Parent, which offer,
          if accepted by the requisite number of holders, would result in a
          Change in Control.

     "Group" shall mean any group of "persons" (as such term is used in section
13(d) and section 14(d)(2) of the Exchange Act as in effect on the date of the
Closing) constituting a "group" for the purposes of Section 13(d) of the
Exchange Act, or any successor provision.

     Section 8.4. Allocation of Partial Prepayments. In the case of each partial
prepayment of the Notes pursuant to Section 8.2, the principal amount of the
Notes to be prepaid shall be allocated among all of the Notes at the time
outstanding in proportion, as nearly as practicable, to the respective unpaid
principal amounts thereof not theretofore called for prepayment.

     Section 8.5. Maturity; Surrender, Etc. In the case of each prepayment or
purchase of Notes pursuant to this Section 8, the principal amount of each Note
to be prepaid or purchased shall mature and become due and payable on the date
fixed for such prepayment or purchase, together with interest on such principal
amount accrued to such date and the applicable Make-Whole Amount, if any. From
and after such date, unless the Company shall fail to pay such

                                      19

<PAGE>

principal amount when so due and payable, together with the interest and
Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid, purchased or prepaid in full shall be
surrendered to the Company and cancelled and shall not be reissued, and no Note
shall be issued in lieu of any prepaid or purchased principal amount of any
Note.

     Section 8.6. Purchase of Notes. The Company will not and will not permit
any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except upon the purchase, payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes. The Company will promptly cancel all Notes acquired by it or any
Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to
any provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.

     Section 8.7. Make-Whole Amount. The term "Make-Whole Amount" means, with
respect to any Note, an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the Called Principal
of such Note over the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:

     "Called Principal" means, with respect to any Note, the principal of such
Note that is to be prepaid or purchased pursuant to Section 8.2 or Section 8.3
or has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.

     "Discounted Value" means, with respect to the Called Principal of any Note,
the amount obtained by discounting all Remaining Scheduled Payments with respect
to such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.

     "Reinvestment Yield" means, with respect to the Called Principal of any
Note, .50% over the yield to maturity implied by (i) the yields reported, as of
10:00 A.M. (New York City time) on the second Business Day preceding the
Settlement Date with respect to such Called Principal, on the display designated
the "PX Screen" on the Bloomberg Financial Markets Service Screen (or such other
display as may replace "PX Screen" on Bloomberg Financial Markets Service) for
actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date, or
(ii) if such yields are not reported as of such time or the yields reported as
of such time are not ascertainable, the Treasury Constant Maturity Series Yields
reported, for the latest day for which such yields have been so reported as of
the second Business Day preceding the Settlement Date with respect to such
Called Principal, in Federal Reserve Statistical Release H.15 (519) (or any
comparable successor publication) for actively traded U.S. Treasury securities
having a constant maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date. Such implied yield will be determined, if
necessary, by (a) converting U.S. Treasury bill quotations to bond-equivalent
yields in accordance with accepted financial practice and (b) interpolating
linearly between (1)

                                      20

<PAGE>

the actively traded U.S. Treasury security with the maturity closest to and
greater than the Remaining Average Life and (2) the actively traded U.S.
Treasury security with the maturity closest to and less than the Remaining
Average Life.

     "Remaining Average Life" means, with respect to any Called Principal, the
number of years (calculated to the nearest one-twelfth year) obtained by
dividing (i) such Called Principal into (ii) the sum of the products obtained by
multiplying (a) the principal component of each Remaining Scheduled Payment with
respect to such Called Principal by (b) the number of years (calculated to the
nearest one-twelfth year) that will elapse between the Settlement Date with
respect to such Called Principal and the scheduled due date of such Remaining
Scheduled Payment.

     "Remaining Scheduled Payments" means, with respect to the Called Principal
of any Note, all payments of such Called Principal and interest thereon that
would be due after the Settlement Date with respect to such Called Principal if
no payment or purchase of such Called Principal were made prior to its scheduled
due date, provided that if such Settlement Date is not a date on which interest
payments are due to be made under the terms of the Notes, then the amount of the
next succeeding scheduled interest payment will be reduced by the amount of
interest accrued to such Settlement Date and required to be paid on such
Settlement Date pursuant to Section 8.2, 8.3 or 12.1.

     "Settlement Date" means, with respect to the Called Principal of any Note,
the date on which such Called Principal is to be prepaid or purchased pursuant
to Section 8.2 or Section 8.3 or has become or is declared to be immediately due
and payable pursuant to Section 12.1, as the context requires.

SECTION 9  Affirmative Covenants.

     The Company covenants that so long as any of the Notes are outstanding:

     Section 9.1. Compliance with Law. The Company will, and will cause each of
its Subsidiaries to, comply with all laws, ordinances or governmental rules or
regulations to which each of them is subject, including, without limitation,
Environmental Laws, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental authorizations
necessary to the ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary to ensure that
non-compliance with such laws, ordinances or governmental rules or regulations
or failures to obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.

     Section 9.2. Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.

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<PAGE>

     Section 9.3. Maintenance of Properties. Except as may be otherwise
permitted under Section 10.7, the Company will, and will cause each of its
Subsidiaries to, maintain and keep, or cause to be maintained and kept, their
respective properties in good repair, working order and condition (other than
ordinary wear and tear), so that the business carried on in connection therewith
may be properly conducted at all times, provided that this Section 9.3 shall not
prevent the Company or any Subsidiary from discontinuing the operation and the
maintenance of any of its properties if such discontinuance is desirable in the
conduct of its business and the Company has concluded that such discontinuance
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

     Section 9.4. Payment of Taxes and Claims. The Company will, and will cause
each of its Subsidiaries to, file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or franchises, to the
extent such taxes and assessments have become due and payable and before they
have become delinquent and all claims for which sums have become due and payable
that have or might become a Lien on properties or assets of the Company or any
Subsidiary, provided that neither the Company nor any Subsidiary need pay any
such tax or assessment or claims if (a) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (b) the nonpayment of all such taxes and
assessments in the aggregate could not reasonably be expected to have a Material
Adverse Effect.

     Section 9.5. Corporate Existence, Etc. Except as may be otherwise permitted
under Section 10.2, the Company will at all times preserve and keep in full
force and effect its corporate existence. Subject to Sections 10.2 and 10.7, the
Company will at all times preserve and keep in full force and effect the
corporate, limited liability company, or partnership existence of each of its
Subsidiaries and all rights and franchises of the Company and its Subsidiaries
unless, in the good faith judgment of the Company, the termination of or failure
to preserve and keep in full force and effect such corporate existence, right or
franchise could not, individually or in the aggregate, have a Material Adverse
Effect.

     Section 9.6. New Subsidiaries. The Company will:

          (a)     cause each and every Material Subsidiary acquired or
     established subsequent to the date of this Agreement to execute and deliver
     a Material Subsidiary Guaranty to the Holders pursuant to which each such
     Material Subsidiary shall guarantee the payment of all amounts payable by
     the Company hereunder and under the Notes and the performance of all
     obligations of the Company hereunder and under the Notes, along with such
     additional Collateral Documents to secure its obligations under the
     Material Subsidiary Guaranty to the Holders and such other documentation as
     may be reasonably requested by Holders of the Notes, in form and substance
     reasonably acceptable to Holders of the Notes;

          (b)     in connection with the delivery of the Material Subsidiary
     Guaranty and the relevant Collateral Documents, the Company shall cause
     each Material Subsidiary

                                      22

<PAGE>

     Guarantor to deliver to each Holder of the Notes (i) such documents and
     evidence with respect to such Material Subsidiary Guarantor as any Holder
     may reasonably request in order to establish the existence and good
     standing of such Material Subsidiary Guarantor and evidence that the Board
     of Directors of such Material Subsidiary Guarantor has adopted resolutions
     authorizing the execution and delivery of the Material Subsidiary Guaranty
     and the Collateral Documents to which such Material Subsidiary Guarantor
     will become a party, (ii) evidence that the Material Subsidiary Guaranty
     and the relevant Collateral Documents do not violate any of such Material
     Subsidiary Guarantor's outstanding debt instruments in the form of (A) a
     certificate from such Material Subsidiary Guarantor to such effect, (B)
     consents or approvals of the holder or holders of any Security, and/or (C)
     amendments of agreements pursuant to which any Security may have been
     issued, all as may be reasonably deemed necessary by the Holders to permit
     the execution and delivery of the Material Subsidiary Guaranty and the
     Collateral Documents to which such Material Subsidiary Guarantor is a
     party, (iii) a certificate of such Material Subsidiary containing
     representations and warranties substantially similar to the representations
     and warranties as are set forth in Section 5 hereof applicable to such
     Material Subsidiary Guarantor and such other certificates or other evidence
     as any Holder may reasonably request to establish that the transactions
     contemplated by the Material Subsidiary Guaranty and the Collateral
     Documents to which such Material Subsidiary Guarantor is a party shall not
     subject any such Material Subsidiary Guarantor to any tax, penalty,
     liability or other onerous condition under or pursuant to any applicable
     law or governmental regulation, (iv) an opinion of independent counsel
     (which opinion, in scope, form and substance, and counsel, shall be
     reasonably satisfactory to the Holders) and (v) all other documents and
     showings reasonably requested by the Holders in connection with the
     execution and delivery of the Material Subsidiary Guaranty and the
     Collateral Documents to which such Material Subsidiary Guarantor is a
     party, which documents shall be satisfactory in form and substance to the
     Holders and their special counsel, and each Holder shall have received a
     copy (executed or certified as may be appropriate) of all of the foregoing
     legal documents;

          (c)     in addition to the other limitations contained in this
     Agreement, the Company will not permit any Material Subsidiary which is not
     a Material Subsidiary Guarantor at that time to be or become liable in
     respect of any other Guaranty after the date hereof; provided, however,
     that such Material Subsidiary may execute and deliver such subsequent
     Guaranty so long as the Company shall contemporaneously therewith cause
     such Material Subsidiary to execute and deliver, and such Material
     Subsidiary shall execute and deliver, to the Holders of the Notes, a
     Material Subsidiary Guaranty and all relevant Collateral Documents together
     with all other documents, agreement, certificates and opinions in
     compliance with the terms and provisions of this Section 9.6. It being the
     intent of this Section 9.6(c) that at all times the Company shall cause all
     Subsidiaries which have executed and delivered Guaranties to Holders of
     Funded Debt of the Company and/or any other Material Subsidiary to be
     Material Subsidiary Guarantors in accordance with and pursuant to the
     provisions of this Section 9.6; and

          (d)     all reasonable out-of-pocket fees and expenses of the Holders
     of the Notes, including, without limitation, the reasonable fees and
     expenses of special counsel to the Holders of the Notes, incurred in
     connection with the execution and delivery of the

                                      23

<PAGE>

     Material Subsidiary Guaranty, the Collateral Documents and the related
     agreements and opinions described above shall be borne by the Company.

SECTION 10 Negative Covenants.

          The Company covenants that so long as any of the Notes are
     outstanding:

     Section 10.1. Transactions with Affiliates. The Company will not and will
not permit any Subsidiary to enter into directly or indirectly any transaction
or Material group of related transactions (including, without limitation, the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate (other than the Company or any Subsidiary),
except in the ordinary course of the Company's or such Subsidiary's business and
upon fair and reasonable terms no less favorable to the Company or such
Subsidiary than would be obtainable in a comparable arm's-length transaction
with a Person not an Affiliate.

     Section 10.2. Merger, Consolidation, Etc. Except as may be permitted under
Section 10.7, the Parent shall not, and shall not permit any Subsidiary to,
consolidate with or merge with any other corporation or convey, transfer or
lease substantially all of its assets in a single transaction or series of
transactions to any Person (except that a Subsidiary (including, without
limitation, TREX LLC) may consolidate with or merge with, or convey, transfer or
lease substantially all of its assets in a single transaction or series of
transactions to (a) the Parent, or (b) a Wholly-owned Subsidiary of the Parent;
provided that in any such transaction involving the Parent, such surviving
entity shall be the Parent) unless:

            (i)   the successor formed by such consolidation or the survivor of
     such merger or the Person that acquires by conveyance, transfer or lease
     substantially all of the assets of the Company as an entirety, as the case
     may be, shall be solvent and shall be organized and existing under the laws
     of the United States or any State thereof (including the District of
     Columbia), and, if the Company is not such successor, (1) such successor
     shall have executed and delivered to each holder of any Notes its
     assumption of the due and punctual performance and observance of each
     covenant and condition of this Agreement, the Collateral Documents and the
     Notes and (2) shall have caused to be delivered to each holder of any Notes
     an opinion of nationally recognized independent counsel, or other
     independent counsel reasonably satisfactory to the Required Holders, to the
     effect that all agreements or instruments effecting such assumption are
     enforceable in accordance with their terms and comply with the terms
     hereof; and

            (ii)  immediately prior to and after giving effect to such
     transaction, (1) no Default or Event of Default shall have occurred and be
     continuing and (2) in any transaction not covered by clause (a) or (b)
     above, the surviving corporation would be permitted by the provisions of
     Section 10.6(d) to incur at least $1.00 of additional Funded Debt.

No such conveyance, transfer or lease of substantially all of the assets of the
Company shall have the effect of releasing the Company or any successor
corporation that shall theretofore have become such in the manner prescribed in
this Section 10.2 from its liability under this Agreement or the Notes.

                                      24

<PAGE>

     Section 10.3. Liens. The Company will not, and will not permit any of its
Subsidiaries to, create or incur, or suffer to be incurred or to exist, any Lien
on its or their property or assets, whether now owned or hereafter acquired or
upon any income or profits therefrom, or transfer any property for the purpose
of subjecting the same to the payment of obligations in priority to the payment
of its or their general creditors, or acquire or agree to acquire, or permit any
of its Subsidiaries to acquire, any property or assets upon conditional sales
agreements or other title retention devices, except:

          (a)      Liens for property taxes and assessments or governmental
     charges or levies and Liens securing claims or demands of mechanics and
     materialmen, provided payment thereof is not at the time required by
     Section 9.4;

          (b)      Liens of or resulting from any judgment or award, the time
     for the appeal or petition for rehearing of which shall not have expired,
     or in respect of which the Company or a Subsidiary shall at any time in
     good faith be prosecuting an appeal or proceeding for a review and in
     respect of which a stay of execution pending such appeal or proceeding for
     review shall have been secured;

          (c)      Liens incidental to the conduct of business or the ownership
     of properties and assets (including Liens in connection with worker's
     compensation, unemployment insurance and other like laws, warehousemen's
     and attorneys' liens and statutory landlords' liens) and Liens to secure
     the performance of bids, tenders or trade contracts, or to secure statutory
     obligations, surety or appeal bonds or other Liens of like general nature
     incurred in the ordinary course of business and not in connection with the
     incurrence of Debt, provided that such Liens do not, individually or in the
     aggregate, materially impair the use of the property encumbered by any such
     Lien in the operation of the business of the Company and its Subsidiaries,
     taken as a whole, or the value of the property so encumbered for the
     purposes of such business;

          (d)      minor survey exceptions or minor encumbrances, easements or
     reservations, or rights of others for rights-of-way, utilities and other
     similar purposes, or zoning or other restrictions as to the use of real
     properties, which are necessary for the conduct of the activities of the
     Company and its Subsidiaries or which customarily exist on properties of
     corporations engaged in similar activities and similarly situated and which
     do not in any event materially impair their use in the operation of the
     business of the Company and its Subsidiaries;

          (e)      Liens securing Debt of Subsidiary to the Company or to
     another Wholly-owned Subsidiary;

          (f)      Liens securing Debt of the Company or any Subsidiary existing
     as of the date of Closing and reflected on Schedule 5.15 hereto and Liens
     securing any refinancing of any such Debt; provided that so long as (x) the
     principal amount of Debt so secured at the time of such refinancing is not
     increased, (y) such Liens apply only to the same property which was
     theretofore subject thereto, and (z) at the time of such refinancing, no
     Default or Event of Default shall have occurred and be continuing; and
     provided further

                                      25

<PAGE>

     that with respect to any refinancing or replacement of the Revolving
     Commitment under the Credit Agreement as in effect as of the Closing or any
     refinancing thereof, such replaced or refinanced revolving commitment is
     issued pursuant to a Qualified Replacement Credit Agreement;

          (g)      Liens incurred after the Closing given to secure the payment
     of the purchase price incurred in connection with the acquisition,
     construction or improvement of fixed assets of the company, which Liens are
     incurred contemporaneously with or within 180 days after the payment of
     such purchase price of completion of such construction or improvement and
     Liens existing on fixed assets at the time of acquisition thereof or at the
     time of acquisition by the company of any business entity then owning such
     fixed assets whether by merger, consolidation or acquisition of
     substantially all of its assets, and whether or not such existing Liens
     were given to secure the payment of the purchase price of the fixed assets
     to which they attach, provided that (i) the Lien shall attach solely to the
     fixed assets acquired, constructed or improved, (ii) at the time of
     acquisition, construction or improvement of such fixed assets, the
     aggregate amount remaining unpaid on all Debt secured by such Liens on such
     fixed assets whether or not assume by the Company shall not exceed an
     amount equal to 100% of the lesser of the total purchase price or fair
     market value at the time of acquisition, construction or improvement of
     such fixed assets (as determined in good faith by the Board of Directors of
     the Company where the total purchase price or fair market value is in
     excess of $1,000,000 and as determined in good faith by senior management
     of the Company where the total purchase price or fair market value is
     $1,000,000 or less), and (iii) all Debt secured by such Liens shall be have
     incurred within the applicable limitations of this Agreement including,
     without limitation, Section 10.6(d);

          (h)      any interest or title of a lessor in property subject to any
     Capital Lease or Operating Lease;

          (i)      Liens created or permitted under the Collateral Documents;

          (j)      prior to a Permitted Collateral Release, in addition to the
     Liens permitted under Section 10.3(a) through (i) and (k) and (l), Liens
     securing Collateral Pool Debt; provided that all such Collateral Pool Debt
     secured by Liens incurred pursuant to this clause (j) will not exceed
     $20,000,000 in aggregate principal amount outstanding at any time;

          (k)      in addition to the Liens permitted under Section 10.3(a)
     through (j) and (l), Liens securing Debt that does not exceed $250,000 in
     the aggregate; and

          (l)      in addition to the Liens permitted under Section 10.3(a)
     through (k), Liens securing Debt of the Company or any Subsidiary incurred
     within the limitations of Section 10.6(e).

     Section 10.4. Consolidated Adjusted Net Worth. The Company will at all
times keep and maintain Consolidated Adjusted Net Worth at an amount not less
than the sum of (a) $70,000,000 plus (b) 25% of Consolidated Net Earnings
computed on a cumulative basis for

                                      26

<PAGE>

each of the elapsed fiscal years ending after December 31, 2001; provided that
notwithstanding that Consolidated Net Earnings for any elapsed fiscal year may
be a deficit figure, no reduction as a result thereof shall be made in the sum
to be maintained pursuant hereto.

     Section 10.5. Cash Flow Fixed Charge Coverage Ratio. The Company will keep
and maintain the ratio of Consolidated Cash Flow to Consolidated Fixed Charges
calculated on a Rolling Four Quarter Pro Forma Basis at not less than 2.0 to
1.00.

     Section 10.6. Limitations on Funded Debt. The Company will not, and the
Company will not permit any Subsidiary to, create, assume, guarantee or
otherwise incur or in any manner become liable in respect of any Funded Debt
except:

          (a)      Funded Debt evidenced by the Notes;

          (b)      Funded Debt of the Parent and its Subsidiaries outstanding as
     of the date of this Agreement and described on Schedule 5.15 hereto or any
     extension, renewal or refunding of any Funded Debt without increase in the
     principal amount thereof at the time of such extension, renewal or
     refunding;

          (c)      Funded Debt incurred pursuant to the Credit Agreement or
     pursuant to a Qualified Replacement Credit Agreement to the extent that
     such Qualified Replacement Credit Agreement shall not result in an increase
     in the principal amount of the Revolving Commitment under and pursuant to
     the Credit Agreement as in effect as of the Closing;

          (d)      additional Funded Debt of the Parent and of its Subsidiaries
     incurred after the Closing, provided, however, that Consolidated Funded
     Debt shall not exceed 60% of Consolidated Total Capitalization, determined
     at the end of the immediately preceding fiscal quarter; and

          (e)      additional Priority Debt, provided, however, that the Company
     will not at any time permit the aggregate amount of outstanding Priority
     Debt to exceed an amount equal to 15% of Consolidated Adjusted Net Worth,
     determined at the end of the immediately preceding fiscal quarter.

Any Person which becomes a Subsidiary after the date hereof shall for all
purposes of this Section 10.6 be deemed to have created, assumed or incurred at
the time it becomes a Subsidiary all Debt of such Person existing immediately
after it becomes a Subsidiary.

     Section 10.7. Sale of Assets, Etc. The Company shall not, and shall not
permit any Subsidiary thereof to, sell, lease, transfer or otherwise dispose of
assets (except assets sold in the ordinary course of business for fair market
value and except as provided in Section 10.2(b)); provided that the foregoing
restrictions do not apply to:

          (a)      the sale, lease, transfer or other disposition of assets of a
     Subsidiary to the Parent or to a Wholly-Owned Subsidiary;

          (b)      subject to the provisions of Section 10.2 hereof, the
     transfer to a Wholly-Owned Subsidiary created by TREX LLC or the Parent of
     all patents, trademarks,

                                      27

<PAGE>

     copyrights and other intellectual property of the Company, and the
     licensure of such intellectual property to the Company;

          (c)   the disposition of used, worn-out or obsolete equipment for no
     (or nominal) consideration if deemed prudent in the reasonable business
     judgment of the Company;

          (d)    the termination of the corporate or other existence of DENPLAX,
     S.A. and the Company's surrender of the Company's equity interest in
     DENPLAX, S.A., provided that no Default or Event of Default has occurred or
     would occur as a result of such termination of existence and surrender of
     equity interest and further provided that such termination of existence and
     surrender of equity interest is deemed prudent in the reasonable business
     judgment of the Company; or

          (e)    the sale of assets for cash or other property to a person or
     persons if all the following conditions are met:

                 (i)  such assets (valued at net book value) do not, together
          with all other assets of the Company and its Subsidiaries previously
          disposed of during the period from the date of this Agreement to and
          including the date of the sale of such assets (other than in the
          ordinary course of business), exceed 25% of Consolidated Total Assets,
          determined at the end of the immediately preceding fiscal quarter; and

                 (ii) immediately prior to and after the consummation of the
          transaction and prior to and after giving effect thereto (A) no
          Default or Event of Default would exist and (B) the Company would be
          permitted by the provisions of Section 10.6(d) to incur at least $1.00
          of additional Funded Debt;

provided, however, that for the purposes of the foregoing calculation, there
shall not be included any assets to the extent that the net proceeds of the sale
of such assets were or are applied (or are committed to be applied, and are
thereafter actually applied within 90 days after the end of the 365 day period)
within 365 days of the date of sale of such assets to either (A) the acquisition
of fixed assets useful and intended to be used in the operation of the business
of the Company and its Subsidiaries as described in Section 10.8 and having a
fair market value (as determined in good faith by the board of directors of the
Company for assets having a fair market value in excess of $1,000,000 and as
determined in good faith by senior management of the Company for assets having a
fair market value of $1,000,000 or less) at least equal to that of the net
proceeds applied from the sale of the assets so disposed of or (B) (1) prior to
the occurrence of a Permitted Collateral Release or at any time when any of the
Collateral Documents are in full force and effect, to the prepayment of Secured
Obligations on a pro rata basis, and (2) after the occurrence of a Permitted
Collateral Release, to the prepayment of Funded Debt which is not subordinated
to the Notes on a pro rata basis. It is understood and agreed by the Company
that any such proceeds paid and applied to the prepayment of the Notes as
hereinabove provided shall be prepaid as and to the extent provided in Section
8.2.

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<PAGE>

     Section 10.8. Line of Business. The Company will not, and will not permit
any of its Subsidiaries to, engage in any business if, as a result, the general
nature of the business in which the Company and its Subsidiaries, taken as a
whole, would then be engaged would be substantially changed from the general
nature of the business in which the Company and its Subsidiaries, taken as a
whole, are engaged on the date of this Agreement as described in the Memorandum.

SECTION 11 Events Of Default.

     An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:

          (a)      the Company defaults in the payment of any principal or
     Make-Whole Amount, if any, on any Note when the same becomes due and
     payable, whether at maturity or at a date fixed for prepayment or by
     declaration or otherwise; or

          (b)      the Company defaults in the payment of any interest on any
     Note for more than five Business Days after the same becomes due and
     payable; or

          (c)      the Company defaults in the performance of or compliance with
     any term contained in Sections 10.3 through 10.7; or

          (d)      the Company defaults in the performance of or compliance with
     any term contained herein (other than those referred to in paragraphs (a),
     (b) and (c) of this Section 11) and such default is not remedied within 30
     days after the earlier of (i) a Responsible Officer obtaining actual
     knowledge of such default and (ii) the Company receiving written notice of
     such default from any holder of a Note (any such written notice to be
     identified as a "notice of default" and to refer specifically to this
     paragraph (d) of Section 11); or

          (e)      any representation or warranty made in writing by or on
     behalf of the Company or by any officer of the Company in this Agreement or
     in any writing furnished in connection with the transactions contemplated
     hereby proves to have been false or incorrect in any material respect on
     the date as of which made; or

          (f)      (i) the Company or any Subsidiary is in default (as principal
     or as guarantor or other surety) in the payment of any principal of or
     premium or make-whole amount or interest on any Debt that is outstanding in
     an aggregate principal amount of at least $1,000,000 beyond any period of
     grace provided with respect thereto, or (ii) the Company or any Subsidiary
     is in default in the performance of or compliance with any term of any
     evidence of any Debt without regard to any waiver, amendment or
     modification thereof as a result of an anticipated default thereunder in an
     aggregate outstanding principal amount of at least $1,000,000 or of any
     mortgage, indenture or other agreement relating thereto or any other
     condition exists, and as a consequence of such default or condition such
     Indebtedness has become, or has been declared (or one or more Persons are
     entitled to declare such Debt to be), due and payable before its stated
     maturity or before its regularly scheduled dates of payment and such
     default has continued for 60 consecutive days from the occurrence thereof,
     or (iii) as a consequence

                                      29

<PAGE>

     of the occurrence or continuation of any event or condition, which is not
     cured, remedied, or waived for a period of up to 60 days from the
     occurrence of any event or condition (other than the passage of time or the
     right of the holder of Debt to convert such Debt into equity interests),
     (x) the Company or any Subsidiary has become obligated to purchase or repay
     Debt before its regular maturity or before its regularly scheduled dates of
     payment in an aggregate outstanding principal amount of at least
     $1,000,000, or (y) one or more Persons have the right to require the
     Company or any Subsidiary so to purchase or repay such Debt; or

          (g) the Company or any Subsidiary (i) is generally not paying, or
     admits in writing its inability to pay, its debts as they become due, (ii)
     files, or consents by answer or otherwise to the filing against it of, a
     petition for relief or reorganization or arrangement or any other petition
     in bankruptcy, for liquidation or to take advantage of any bankruptcy,
     insolvency, reorganization, moratorium or other similar law of any
     jurisdiction, (iii) makes an assignment for the benefit of its creditors,
     (iv) consents to the appointment of a custodian, receiver, trustee or other
     officer with similar powers with respect to it or with respect to any
     substantial part of its property, (v) is adjudicated as insolvent or to be
     liquidated, or (vi) takes corporate action for the purpose of any of the
     foregoing; or

          (h) a court or governmental authority of competent jurisdiction enters
     an order appointing, without consent by the Company or any of its
     Subsidiaries, a custodian, receiver, trustee or other officer with similar
     powers with respect to it or with respect to any substantial part of its
     property, or constituting an order for relief or approving a petition for
     relief or reorganization or any other petition in bankruptcy or for
     liquidation or to take advantage of any bankruptcy or insolvency law of any
     jurisdiction, or ordering the dissolution, winding-up or liquidation of the
     Company or any of its Subsidiaries, or any such petition shall be filed
     against the Company or any of its Subsidiaries and such petition shall not
     be dismissed within 60 days; or

          (i) a final judgment or judgments for the payment of money aggregating
     in excess of $1,000,000 are rendered against one or more of the Company and
     its Subsidiaries and which judgments are not, within 45 days after entry
     thereof, bonded, discharged or stayed pending appeal, or are not discharged
     within 45 days after the expiration of such stay; or

          (j) (i) any Plan shall fail to satisfy the minimum funding standards
     of ERISA or the Code for any plan year or part thereof or a waiver of such
     standards or extension of any amortization period is sought or granted
     under section 412 of the Code, (ii) a notice of intent to terminate any
     Plan shall have been or is reasonably expected to be filed with the PBGC or
     the PBGC shall have instituted proceedings under ERISA section 4042 to
     terminate or appoint a trustee to administer any Plan or the PBGC shall
     have notified the Company or any ERISA Affiliate that a Plan may become a
     subject of any such proceedings, (iii) the aggregate "amount of unfunded
     benefit liabilities" (within the meaning of section 4001(a)(18) of ERISA)
     under all Plans, determined in accordance with Title IV of ERISA, shall
     exceed $1,000,000, (iv) the Company or any ERISA Affiliate shall have
     incurred or is reasonably expected to incur any liability pursuant to

                                      30

<PAGE>

        Title I or IV of ERISA or the penalty or excise tax provisions of the
        Code relating to employee benefit plans, (v) the Company or any ERISA
        Affiliate withdraws from any Multiemployer Plan, or (vi) the Company or
        any Subsidiary establishes or amends any employee welfare benefit plan
        that provides post-employment welfare benefits in a manner that would
        increase the liability of the Company or any Subsidiary thereunder; and
        any such event or events described in clauses (i) through (vi) above,
        either individually or together with any other such event or events,
        could reasonably be expected to have a Material Adverse Effect; or

             (k)      the Parent or TREX LLC defaults in the performance of or
        compliance with any term contained in the Collateral Documents, and such
        default continues beyond any period of grace in respect thereof, or any
        Collateral Document ceases to be in full force and effect as a result of
        acts taken by the Company or any Subsidiary, except in connection with a
        Permitted Collateral Release, or any Collateral Document is declared to
        be null and void in whole or in material part by a court or other
        governmental or regulatory authority having jurisdiction or the validity
        or enforceability of any Collateral Document shall be contested by the
        Parent or TREX LLC or the Parent or TREX LLC renounces any Collateral
        Document or denies that it has any or further liability under any
        Collateral Document.

As used in Section 11(j), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.

SECTION 12 Remedies On Default, Etc.

        Section 12.1. Acceleration. If an Event of Default with respect to the
Company described in paragraph (g) or (h) of Section 11 (other than an Event of
Default described in clause (i) of paragraph (g) or described in clause (vi) of
paragraph (g) by virtue of the fact that such clause encompasses clause (i) of
paragraph (g)) has occurred, all the Notes then outstanding shall automatically
become immediately due and payable. If any other Event of Default has occurred
and is continuing the Required Holders at the time outstanding may at any time
at its or their option, by notice or notices to the Company, declare all the
Notes then outstanding to be immediately due and payable. If any Event of
Default described in paragraph (a) or (b) of Section 11 has occurred and is
continuing, any holder or holders of Notes at the time outstanding affected by
such Event of Default may at any time, at its or their option, by notice or
notices to the Company, declare all the Notes held by it or them to be
immediately due and payable. Upon any Notes becoming due and payable under this
Section 12.1, whether automatically or by declaration, such Notes will forthwith
mature and the entire unpaid principal amount of such Notes, plus (i) all
accrued and unpaid interest thereon and (ii) the Make-Whole Amount determined in
respect of such principal amount (to the full extent permitted by applicable
law), shall all be immediately due and payable, in each and every case without
presentment, demand, protest or further notice, all of which are hereby waived.
The Company acknowledges, and the parties hereto agree, that each holder of a
Note has the right to maintain its investment in the Notes free from repayment
by the Company (except as herein specifically provided for) and that the
provision for payment of a Make-Whole Amount by the Company in the event that
the Notes are prepaid or are accelerated as a result of an Event of Default, is
intended to provide compensation for the deprivation of such right under such
circumstances.

                                      31

<PAGE>

        Section 12.2. Other Remedies. If any Default or Event of Default has
occurred and is continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section 12.1, the holder of
any Note at the time outstanding may proceed to protect and enforce the rights
of such holder by an action at law, suit in equity or other appropriate
proceeding, whether for the specific performance of any agreement contained
herein or in any Note, or for an injunction against a violation of any of the
terms hereof or thereof, or in aid of the exercise of any power granted hereby
or thereby or by law or otherwise.

        Section 12.3. Rescission. At any time after any Notes have been declared
due and payable pursuant to the second or third sentence of Section 12.1, the
holders of not less than 66-2/3% in principal amount of the Notes then
outstanding, by written notice to the Company, may rescind and annul any such
declaration and its consequences if (a) the Company has paid all overdue
interest on the Notes, all principal of and Make-Whole Amount, if any, on any
Notes that are due and payable and are unpaid other than by reason of such
declaration, and all interest on such overdue principal and Make-Whole Amount,
if any, and (to the extent permitted by applicable law) any overdue interest in
respect of the Notes, at the Default Rate, (b) all Events of Default and
Defaults, other than non-payment of amounts that have become due solely by
reason of such declaration, have been cured or have been waived pursuant to
Section 17, and (c) no judgment or decree has been entered for the payment of
any monies due pursuant hereto or to the Notes. No rescission and annulment
under this Section 12.3 will extend to or affect any subsequent Event of Default
or Default or impair any right consequent thereon.

        Section 12.4. No Waivers or Election of Remedies, Expenses, Etc. No
course of dealing and no delay on the part of any holder of any Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers or remedies. No right, power or
remedy conferred by this Agreement or by any Note upon any holder thereof shall
be exclusive of any other right, power or remedy referred to herein or therein
or now or hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the Company
will pay to the holder of each Note on demand such further amount as shall be
sufficient to cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including, without limitation,
reasonable attorneys' fees, expenses and disbursements.

SECTION 13 Registration; Exchange; Substitution Of Notes.

        Section 13.1. Registration of Notes. The Company shall keep at its
principal executive office a register for the registration and registration of
transfers of Notes. The name and address of each holder of one or more Notes,
each transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor, promptly upon written request therefor, a complete and
correct copy of the names and addresses of all registered holders of Notes.

        Section 13.2. Transfer and Exchange of Notes. Upon surrender of any Note
at the principal executive office of the Company for registration of transfer or
exchange (and in the

                                      32

<PAGE>

case of a surrender for registration of transfer, duly endorsed or accompanied
by a written instrument of transfer duly executed by the registered holder of
such Note or his attorney duly authorized in writing and accompanied by the
address for notices of each transferee of such Note or part thereof), the
Company shall execute and deliver, at the Company's expense (except as provided
below), one or more new Notes (as requested by the holder thereof) in exchange
therefor, in an aggregate principal amount equal to the unpaid principal amount
of the surrendered Note. Each such new Note shall be payable to such Person as
such holder may request and shall be substantially in the form of Exhibit 1.
Each such new Note shall be dated and bear interest from the date to which
interest shall have been paid on the surrendered Note or dated the date of the
surrendered Note if no interest shall have been paid thereon. The Company may
require payment of a sum sufficient to cover any stamp tax or governmental
charge imposed in respect of any such transfer of Notes. Notes shall not be
transferred in denominations of less than $1,000,000, provided that if necessary
to enable the registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $1,000,000. Any
transferee, by its acceptance of a Note registered in its name (or the name of
its nominee), shall be deemed to have made the representations set forth in
Section 6.

        Section 13.3. Replacement of Notes. Upon receipt by the Company of
evidence reasonably satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be, in the case of
an Institutional Investor, notice from such Institutional Investor of such
ownership and such loss, theft, destruction or mutilation), and

                (a)   in the case of loss, theft or destruction, of indemnity
        reasonably satisfactory to it (provided that if the holder of such Note
        is, or is a nominee for, an original Purchaser or another Institutional
        Investor holder of a Note with a minimum net worth of at least
        $50,000,000, such Person's own unsecured agreement of indemnity shall be
        deemed to be satisfactory), or

                (b)   in the case of mutilation, upon surrender and cancellation
        thereof,

the Company at its own expense shall execute and deliver, in lieu thereof, a new
Note of the same series, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or mutilated Note if no
interest shall have been paid thereon.

SECTION 14 Payment Of Notes.

        Section 14.1. Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York, New York at the principal office of The
Chase Manhattan Bank in such jurisdiction. The Company may at any time, by
notice to each holder of a Note, change the place of payment of the Notes so
long as such place of payment shall be either the principal office of the
Company in such jurisdiction or the principal office of a bank or trust company
in such jurisdiction.

        Section 14.2. Home Office Payment. So long as you or your nominee shall
be the holder of any Note, and notwithstanding anything contained in Section
14.1 or in such Note to the contrary, the Company will pay all sums becoming due
on such Note for principal, Make-Whole

                                      33

<PAGE>

Amount, if any, and interest by the method and at the address specified for such
purpose below your name in Schedule A, or by such other method or at such other
address as you shall have from time to time specified to the Company in writing
for such purpose, without the presentation or surrender of such Note or the
making of any notation thereon, except that upon written request of the Company
made concurrently with or reasonably promptly after payment or prepayment in
full of any Note, you shall surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive
office or at the place of payment most recently designated by the Company
pursuant to Section 14.1. Prior to any sale or other disposition of any Note
held by you or your nominee you will, at your election, either endorse thereon
the amount of principal paid thereon and the last date to which interest has
been paid thereon or surrender such Note to the Company in exchange for a new
Note or Notes pursuant to Section 13.2. The Company will afford the benefits of
this Section 14.2 to any Institutional Investor that is the direct or indirect
transferee of any Note purchased by you under this Agreement and that has made
the same agreement relating to such Note as you have made in this Section 14.2.

SECTION 15 Expenses, Etc.

        Section 15.1. Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys' fees of your special counsel referred to in
Section 4.4(b)) incurred by you and each Other Purchaser or holder of a Note in
connection with such transactions and in connection with any amendments, waivers
or consents under or in respect of this Agreement, the Collateral Documents, the
Notes, or the Intercreditor Agreement (whether or not such amendment, waiver or
consent becomes effective), including: (a) the costs and expenses incurred in
enforcing or defending (or determining whether or how to enforce or defend) any
rights under this Agreement, the Collateral Documents, the Notes, or the
Intercreditor Agreement, or in responding to any subpoena or other legal process
or informal investigative demand issued in connection with this Agreement, the
Collateral Documents, the Notes, or the Intercreditor Agreement, or by reason of
being a holder of any Note, and (b) the costs and expenses, including financial
advisors' fees, incurred in connection with the insolvency or bankruptcy of the
Company or any Subsidiary or in connection with any work-out or restructuring of
the transactions contemplated hereby and by the Notes. The Company will pay, and
will save you and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those retained by you).

        Section 15.2. Survival. The obligations of the Company under this
Section 15 will survive the payment or transfer of any Note, the enforcement,
amendment or waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.

SECTION 16 Survival Of Representations And Warranties; Entire Agreement.

        All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by you of any Note or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note, regardless of
any investigation made at any time by or on behalf of you or any other holder of
a Note. All statements contained in any certificate or other instrument

                                      34

<PAGE>

delivered by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this Agreement.
Subject to the preceding sentence, this Agreement and the Notes embody the
entire agreement and understanding between you and the Company and supersede all
prior agreements and understandings relating to the subject matter hereof.

SECTION 17 Amendment And Waiver.

        Section 17.1. Requirements. This Agreement and the Notes may be amended,
and the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21, or any defined term (as it
is used therein), will be effective as to you unless consented to by you in
writing, and (b) no such amendment or waiver may, without the written consent of
the holder of each Note at the time outstanding affected thereby, (i) subject to
the provisions of Section 12 relating to acceleration or rescission, change the
amount or time of any prepayment or payment of principal of, or reduce the rate
or change the time of payment or method of computation of interest or of the
Make-Whole Amount on, the Notes, (ii) change the percentage of the principal
amount of the Notes the holders of which are required to consent to any such
amendment or waiver or (iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20.

        Section 17.2. Solicitation of Holders of Notes.

             (a)      Solicitation. The Company will provide each holder of the
Notes (irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof or of the Notes. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to the provisions
of this Section 17 to each holder of outstanding Notes promptly following the
date on which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.

             (b)      Payment. The Company will not directly or indirectly pay
or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security, to any holder of
Notes as consideration for or as an inducement to the entering into by any
holder of Notes of any waiver or amendment of any of the terms and provisions
hereof or of the Notes unless such remuneration is concurrently paid, or
security is concurrently granted, on the same terms, ratably to each holder of
Notes then outstanding whether or not such holder consented to such waiver or
amendment.

        Section 17.3. Binding Effect, Etc. Any amendment or waiver consented to
as provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder or
under any Note

                                      35

<PAGE>

shall operate as a waiver of any rights of any holder of such Note. As used
herein, the term "this Agreement" and references thereto shall mean this
Agreement as it may from time to time be amended or supplemented.

        Section 17.4. Notes Held by Company, Etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or the Notes, or
have directed the taking of any action provided herein or in the Notes to be
taken upon the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly or
indirectly owned by the Company or any of its Affiliates shall be deemed not to
be outstanding.

SECTION 18 Notices.

        All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery service
(charges prepaid), (b) by registered or certified mail with return receipt
requested (postage prepaid), or (c) by a recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:

                (a)   if to you or your nominee, to you or it at the address
        specified for such communications in Schedule A, or at such other
        address as you or it shall have specified to the Company in writing,

                (b)   if to any other holder of any Note, to such holder at such
        address as such other holder shall have specified to the Company in
        writing, or

                (c)   if to the Company, to the Company at its address set forth
        at the beginning hereof to the attention of Chief Financial Officer, or
        at such other address as the Company shall have specified to the holder
        of each Note in writing.

Notices under this Section 18 will be deemed given only when actually received.

SECTION 19 Reproduction of Documents.

        This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by you at the Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to you, may be reproduced by you by any
photographic, photostatic, microfilm, microcard, miniature photographic or other
similar process and you may destroy any original document so reproduced. The
Company agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and any enlargement, facsimile or further reproduction of
such reproduction shall likewise be admissible in evidence. This Section 19
shall not prohibit the Company or any other holder of Notes from contesting any
such reproduction to the same extent that it could

                                      36

<PAGE>

contest the original, or from introducing evidence to demonstrate the inaccuracy
of any such reproduction.

SECTION 20 Confidential Information.

        For the purposes of this Section 20, "Confidential Information" means
information delivered to you by or on behalf of the Company or any Subsidiary in
connection with the transactions contemplated by or otherwise pursuant to this
Agreement that is proprietary in nature and that was clearly marked or labeled
or otherwise adequately identified in writing when received by you as being
confidential information of the Company or such Subsidiary, provided that such
term does not include information that (a) was publicly known or otherwise known
to you prior to the time of such disclosure, (b) subsequently becomes publicly
known through no act or omission by you or any Person acting on your behalf, (c)
otherwise becomes known to you other than through disclosure by the Company or
any Subsidiary or (d) constitutes financial statements delivered to you under
Section 7.1 that are otherwise publicly available. You will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by you in good faith to protect confidential information of third
parties delivered to you, provided that you may deliver or disclose Confidential
Information to (i) your directors, trustees, officers, employees, agents,
attorneys and affiliates (to the extent such disclosure reasonably relates to
the administration of the investment represented by your Notes) and provided
that such Persons shall receive Confidential Information subject to the
Confidentiality provisions of this Section 20, (ii) your financial advisors and
other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (iii)
any other holder of any Note, (iv) any Institutional Investor to which you sell
or offer to sell such Note or any part thereof or any participation therein (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by the provisions of this Section 20), (v) any Person
from which you offer to purchase any security of the Company (if such Person has
agreed in writing prior to its receipt of such Confidential Information to be
bound by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over you, (vii) the National
Association of Insurance Commissioners or any similar organization, or any
nationally recognized rating agency that requires access to information about
your investment portfolio, or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to you, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
you are a party or (z) if an Event of Default has occurred and is continuing, to
the extent you may reasonably determine such delivery and disclosure to be
necessary or appropriate in the enforcement or for the protection of the rights
and remedies under your Notes and this Agreement. Each holder of a Note, by its
acceptance of a Note, will be deemed to have agreed to be bound by and to be
entitled to the benefits of this Section 20 as though it were a party to this
Agreement. On reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered to such holder
under this Agreement or requested by such holder (other than a holder that is a
party to this Agreement or its nominee or any holder that shall have previously
delivered such a confirmation), such holder will confirm in writing that it is
bound by the provisions of this Section 20.

SECTION 21 Substitution of Purchaser.

                                      37

<PAGE>

        You shall have the right to substitute any one of your Affiliates as the
purchaser of the Notes that you have agreed to purchase hereunder, by written
notice to the Company, which notice shall be signed by both you and such
Affiliate, shall contain such Affiliate's agreement to be bound by this
Agreement and shall contain a confirmation by such Affiliate of the accuracy
with respect to it of the representations set forth in Section 6. Upon receipt
of such notice, wherever the word "you" is used in this Agreement (other than in
this Section 21), such word shall be deemed to refer to such Affiliate in lieu
of you. In the event that such Affiliate is so substituted as a purchaser
hereunder and such Affiliate thereafter transfers to you all of the Notes then
held by such Affiliate, upon receipt by the Company of notice of such transfer,
wherever the word "you" is used in this Agreement (other than in this Section
21), such word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder of the
Notes under this Agreement.

SECTION 22 Release of Collateral.

        You and each subsequent holder of a Note agree to release any Collateral
from the Collateral Documents at such time as either (a) the Bank Lender
releases such Collateral from the Collateral Documents with respect to Revolving
Credit Loan Obligations; or (b) all amounts due and owing under the Credit
Agreement as in effect on the Closing or as amended (but not refinanced or
replaced) with respect to the Revolving Credit Loan Obligations is paid in full
and the Company shall not have executed and delivered a Qualified Replacement
Credit Agreement and no other holder of Debt of the Company shall have required
that the Collateral be pledged to secured such Debt; provided, however, that you
and each subsequent holder will not be required to release any Collateral from
the Collateral Documents under the circumstances contemplated herein if a
Default or Event of Default has occurred and is continuing. Your obligation to
release any Collateral from the Collateral Documents is conditioned upon your
prior receipt of a certificate from a Senior Financial Officer of the Company
stating that the circumstances and conditions described in this Section 22 have
occurred and have been satisfied.

        If at any time subsequent to the release above, the Bank Lender or any
other holder of Debt requires that the Collateral be pledged or repledged to
secure the Company's obligations under the Credit Agreement or such other
evidence of Debt, the Company shall grant a first perfected security interest in
the Collateral to the Noteholders, in addition to any such party. In addition to
the execution of a valid Security Agreement in the form of Exhibit 4.10 hereto,
the Company shall provide to you and the Other Purchasers and you and the Other
Purchasers shall have received the following, in form and substance satisfactory
to you and the Other Purchasers:

                  (i)   evidence that all filings, registrations and recordings
        have been made in the appropriate governmental offices, and all other
        action has been taken, which shall be necessary to create, in favor of
        the Collateral Agent on behalf of the Secured Parties, a perfected
        first priority Lien on the Collateral, including evidence of filing of
        completed UCC-1 financing statements, in each case in the appropriate
        governmental offices;

                  (ii)  the results, dated as of a recent date prior to the
        filing date, of searches conducted in the UCC filing records in each of
        the governmental offices in each jurisdiction in which Collateral is
        located, which shall have revealed no Liens with respect to any of the
        Collateral;

                                      38

<PAGE>

                  (iii) an opinion of counsel for the Company in form and
        substance satisfactory to you and the Other Purchasers in your
        reasonable discretion regarding the transactions contemplated thereby;
        and

                  (iv)  such due diligence and resolutions or other
        authorizations from the Company reasonably acceptable to you and the
        Other Purchasers.

SECTION 23 Miscellaneous.

        Section 23.1. Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.

        Section 23.2. Payments Due on Non-Business Days. Anything in this
Agreement or the Notes to the contrary notwithstanding, any payment of principal
of or Make-whole Amount or interest on any Note that is due on a date other than
a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day.

        Section 23.3. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.

        Section 23.4. Construction. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.

        Section 23.5. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.

        Section 23.6. Governing Law. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.

                                     * * * *

                                      39

<PAGE>

        If you are in agreement with the foregoing, please sign the form of
agreement on the accompanying counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.

                                      Very truly yours,

                                      Trex Company, Inc.

                                      By:  /s/ Anthony J. Cavanna
                                         ---------------------------------------
                                      Name: Anthony J. Cavanna
                                           -------------------------------------
                                      Title: Executive Vice President and Chief
                                            ------------------------------------
                                              Financial Offier
                                            ------------------------------------

                                      TREX Company, LLC

                                      By:  /s/ Anthony J. Cavanna
                                         ---------------------------------------
                                      Name: Anthony J. Cavanna
                                           -------------------------------------
                                      Title: Executive Vice President and Chief
                                            ------------------------------------
                                              Financial Offier
                                            ------------------------------------

                                       40

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

Teachers Insurance and Annuity
  Association of America

By:     /s/ John Goodreds
        --------------------------------------
Name:   John Goodreds
        --------------------------------------
Title:  Associate Director--Private Placements
        --------------------------------------

                                       41

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

Nationwide Life Insurance Company

By:     /s/ Joseph P. Young
        ---------------------------------------
Name:   Joseph P. Young
        ---------------------------------------
Title:  Credit Officer--Fixed Income Securities
        ---------------------------------------

                                       42

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

Nationwide Life And Annuity Insurance Company

By:     /s/ Joseph P. Young
        ---------------------------------------
Name:   Joseph P. Young
        ---------------------------------------
Title:  Credit Officer--Fixed Income Securities
        ---------------------------------------

                                       43

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

AMCO Insurance Company

By:     /s/ Joseph P. Young
        ---------------------------------------
Name:   Joseph P. Young
        ---------------------------------------
Title:  Credit Officer--Fixed Income Securities
        ---------------------------------------

                                       44

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

Nationwide Mutual Insurance Company

By:     /s/ Joseph P. Young
        ---------------------------------------
Name:   Joseph P. Young
        ---------------------------------------
Title:  Credit Officer--Fixed Income Securities
        ---------------------------------------

                                       45

<PAGE>

The foregoing is hereby agreed to as of the date thereof.

Great-West Life & Annuity Insurance Company

By:     /s/ Wayne T. Hoffman
        ---------------------------------------
Name:   Wayne T. Hoffman
        ---------------------------------------
Title:  Senior Vice President--Investments
        ---------------------------------------

By:     /s/ Tad Anderson
        ---------------------------------------
Name:   Tad Anderson
        ---------------------------------------
Title:  Manager--Investments
        ---------------------------------------

                                      46

<PAGE>
                                                                      Schedule B

                                  DEFINED TERMS

     As used herein, the following terms have the respective meanings set forth
below or set forth in the Section hereof following such term:

     "Affiliate" means, at any time, and with respect to any Person, (a) any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person, and (b) any Person beneficially owning or holding, directly
or indirectly, 10% or more of any class of voting or equity interests of the
Company or any Subsidiary or any corporation of which the Company and its
Subsidiaries beneficially own or hold, in the aggregate, directly or indirectly,
10% or more of any class of voting or equity interests. As used in this
definition, "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an "Affiliate"
is a reference to an Affiliate of the Company.

     "Bank Lender" means Branch Banking and Trust Company of Virginia, a
Virginia banking corporation, its successors or assigns in its capacity as
lender under and pursuant to the Credit Agreement and the term "Bank Lender"
shall include all Qualified Replacement Bank Lenders.

     "Business" is defined in Section 10.8.

     "Business Day" means (a) for the purposes of Section 8.7 only, any day
other than a Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed, and (b) for the purposes of any
other provision of this Agreement, any day other than a Saturday, a Sunday or a
day on which commercial banks in Richmond, Virginia are required or authorized
to be closed.

     "Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.

     "Closing" is defined in Section 3.

     "Code" means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.

     "Collateral" means the property described in the Collateral Documents, and
all other property now existing or hereafter acquired which may at any time be
or become subject to a Lien in favor of the Collateral Agent for the benefit of
the holders of the Notes pursuant to the Collateral Documents or otherwise,
securing the payment and performance of the Notes and the other Secured
Obligations.

<PAGE>

     "Collateral Agent" means Branch Banking and Trust Company of Virginia, a
Virginia banking corporation, its successors or assigns in its capacity as
Collateral Agent under and pursuant to the Intercreditor Agreement and the
Collateral Documents.

     "Collateral Documents" means the Security Agreement and any other agreement
pursuant to which the Company or any other Person provides a Lien on its assets
in favor of the Collateral Agent for the benefit of the Holders and all
financing statements, fixture filings, patent, trademark and copyright filings,
assignments, acknowledgments and other filings, documents and agreements made or
delivered pursuant thereto.

     "Collateral Pool Debt" means Debt of the Company (a) which is secured by
the Collateral, (b) the obligees of which are parties to the Intercreditor
Agreement and (c) the agreements evidencing such Debt contain a provision to
release the Collateral from the security therefor substantially identical to the
terms and provisions of Section 22 hereof.

     "Company" means, collectively, Trex Company, Inc., a Delaware corporation,
and TREX Company, LLC, a Delaware limited liability company.

     "Confidential Information" is defined in Section 20.

     "Consolidated Adjusted Net Worth" means the sum of (a) Stockholders'
Equity, (b) deferred taxes, (c) the LIFO Reserve, and (d) minority interests of
the Parent and its Subsidiaries as reflected in the most recent consolidated
balance sheet of the Parent as at the time of determination. Goodwill as
reflected on the balance sheet of the Parent shall be included as part of
Consolidated Adjusted Net Worth.

     "Consolidated Cash Flow" for any period means the sum of (a) Consolidated
Net Earnings during such period plus (to the extent deducted in determining
Consolidated Net Earnings) (b) all provisions for any Federal, state or local
income taxes made by the Parent and its Subsidiaries during such period, (c) all
provisions for depreciation and amortization (other than amortization of debt
discount) made by the Parent and its Subsidiaries during such period, (d)
Consolidated Fixed Charges during such period and (e) net extraordinary non-cash
gains/losses not incurred in the ordinary course of business.

     "Consolidated Fixed Charges" for any period means Consolidated Interest
Expense plus Consolidated Lease Expense.

     "Consolidated Funded Debt" means all Funded Debt of the Parent and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP
eliminating intercompany items.

     "Consolidated Interest Expense" means all Interest Expense of the Parent
and its Subsidiaries, determined on a consolidated basis.

     "Consolidated Lease Expense" means all Lease Expense of the Parent and its
Subsidiaries, determined on a consolidated basis.

     "Consolidated Net Earnings" for any period means the consolidated net
earnings of the Company and its Subsidiaries for such period determined in
accordance with GAAP, determined

                                        2

<PAGE>

on a consolidated basis after eliminating earnings or losses attributable to
outstanding Minority Interests, but excluding in any event:

          (a) any gains or losses on the sale or other disposition of
     Investments or fixed or capital assets, and any taxes on such excluded
     gains and any tax deductions or credits on account of any such excluded
     losses;

          (b) the proceeds of any life insurance policy;

          (c) net earnings and losses of any Subsidiary accrued prior to the
     date it became a Subsidiary;

          (d) net earnings and losses of any corporation (other than a
     Subsidiary), substantially all the assets of which have been acquired in
     any manner by the Parent or any Subsidiary, realized by such corporation
     prior to the date of such acquisition;

          (e) net earnings and losses of any corporation (other than a
     Subsidiary) with which the Parent or a Subsidiary shall have consolidated
     or amalgamated or which shall have merged into or with the Parent or a
     Subsidiary prior to the date of such consolidation, amalgamation or merger;

          (f) net earnings of any business entity (other than a Subsidiary) in
     which the Parent or any Subsidiary has an ownership interest unless such
     net earnings shall have actually been received by the Parent or such
     Subsidiary in the form of cash distributions;

          (g) any portion of the net earnings of any Subsidiary which for any
     reason is unavailable for payment of dividends to the Parent or any other
     Subsidiary;

          (h) earnings or losses resulting from any reappraisal, revaluation,
     write-up or write-down of assets;

          (i) any deferred or other credit representing any excess of, or any
     deficit representing any shortfall in, the equity in any Subsidiary at the
     date of acquisition thereof over the amount invested in such Subsidiary;

          (j) any gain or loss arising from the acquisition of any Securities of
     the Parent or any Subsidiary;

          (k) any reversal of any contingency reserve, except to the extent that
     provision for such contingency reserve shall have been made from income
     arising during such period; and

          (l) any other extraordinary gain or loss.

     "Consolidated Total Assets" means the total assets of the Parent and its
Subsidiaries determined in accordance with GAAP.

                                        3

<PAGE>

     "Consolidated Total Capitalization" means the sum of Consolidated Adjusted
Net Worth and Consolidated Funded Debt.

     "Credit Agreement" means the Credit Agreement dated as of June 19, 2002
between the Company and the Bank Lender, as such Credit Agreement may be
amended, restated, renewed, or extended and the term "Credit Agreement" shall
include a Qualified Replacement Credit Agreement.

     "Debt" with respect to any Person means, at any time, without duplication,

          (a) its liabilities for borrowed money and its redemption obligations
     in respect of mandatorily redeemable Preferred Stock or Preferred Stock
     redeemable at the option of the holder thereof;

          (b) its 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);

          (c) all liabilities appearing on its balance sheet in accordance with
     GAAP in respect of Capital Leases;

          (d) 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);

          (e) all its 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);

          (f) Swaps of such Person; and

          (g) any Guaranty of such Person with respect to liabilities of a type
     described in any of clauses (a) through (f) hereof.

Debt of any Person shall include all obligations of such Person of the character
described in clauses (a) through (g) to the extent such Person remains legally
liable in respect thereof notwithstanding that any such obligation is deemed to
be extinguished under GAAP.

     "Default" means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.

     "Default Rate" means that rate of interest that is the greater of (a) 2.00%
per annum above the rate of interest stated in clause (a) of the first paragraph
of the Notes or (b) 2.00% over the rate of interest publicly announced by [name
of reference bank] in New York, New York as its "base" or "prime" rate.

     "Deferred Payment Hedging Loss" is defined in Section 8.3(f).

                                        4

<PAGE>

     "DENPLAX Agreement" means the Addenda to Business Agreement and Shareholder
Contract dated April 26, 2000 between Empresa de Gestion Medioambiental, S.A.,
Trex Company, Inc., Sorema, S.A., RIH Recycling Industries Holding, S.A., and
DENPLAX, S.A.

     "Domestic Subsidiary" means a Subsidiary or Affiliate (excluding TREX LLC)
that is a corporation, limited liability company, partnership or other legal
entity or joint venture organized or formed under the laws of any State of the
United States or the District of Columbia.

     "Environmental Laws" means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.

     "ERISA Affiliate" means any trade or business (whether or not incorporated)
that is treated as a single employer together with the Company under section 414
of the Code.

     "Event of Default" is defined in Section 11.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.

     "Funded Debt" means all Debt of any Person which would, in accordance with
GAAP, constitute long term Debt including, but not limited to: (a) any Debt with
a maturity of more than one year after the creation of such Debt, (b) any Debt
outstanding under a revolving credit or similar agreement providing for
borrowings (and renewals and extensions thereof) which pursuant to its terms
would constitute long term Debt in accordance with GAAP, (c) any Capital Lease
obligation and (d) any Guaranty with respect to Funded Debt of another person;
provided that in the determination of Funded Debt of the Parent or any
Subsidiary thereof, there shall not be included Debt of the Parent and any
Subsidiary thereof outstanding under any revolving credit agreement or similar
agreement if during the 365-day period immediately preceding the date of any
such calculation of Funded Debt, there shall have been a period of at least 30
consecutive days on each day of which Debt of the Parent and any Subsidiary
thereof outstanding under such revolving credit agreement is equal to zero by
virtue, and solely by virtue, of such Debt having been paid from general
corporate funds of the Parent and any Subsidiary thereof and not from funds
borrowed by the Parent and any Subsidiary thereof pursuant to any other
agreement for the purpose of paying such Debt.

     "GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.

     "Governmental Authority" means

                                        5

<PAGE>

              (a)     the government of

                            (i)     the United States of America or any State or
                      other political subdivision thereof, or

                            (ii)    any jurisdiction in which the Company or any
                      Subsidiary conducts all or any part of its business, or
                      which asserts jurisdiction over any properties of the
                      Company or any Subsidiary, or

              (b)     any entity exercising executive, legislative, judicial,
     regulatory or  administrative  functions of, or pertaining to, any such
     government.

     "Guaranty" means, with respect to any Person, any obligation (except the
endorsement in the ordinary course of business of negotiable instruments for
deposit or collection or the DENPLAX Agreement) of such Person guaranteeing or
in effect guaranteeing any Debt, dividend or other obligation of any other
Person in any manner, whether directly or indirectly, including (without
limitation) obligations incurred through an agreement, contingent or otherwise,
by such Person:

              (a)     to purchase such Debt or obligation or any property
     constituting security therefor;

              (b)     to advance or supply funds (i) for the purchase or payment
     of such Debt or obligation, or (ii) to maintain any working capital or
     other balance sheet condition or any income statement condition of any
     other Person or otherwise to advance or make available funds for the
     purchase or payment of such Debt or obligation;

              (c)     to lease properties or to purchase properties or services
     primarily for the purpose of assuring the owner of such Debt or obligation
     of the ability of any other Person to make payment of the Debt or
     obligation; or

              (d)     otherwise to assure the owner of such Debt or obligation
     against loss in respect thereof.

In any computation of the Debt or other liabilities of the obligor under any
Guaranty, the Debt or other obligations that are the subject of such Guaranty
shall be assumed to be direct obligations of such obligor.

     "Hazardous Material" means any and all pollutants, toxic or hazardous
wastes or any other substances that might pose a hazard to health or safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage, or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law
(including, without limitation, asbestos, urea formaldehyde foam insulation and
polycholorinated biphenyls).

     "holder" means, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.

                                        6

<PAGE>

     "Institutional Investor" means (a) any original purchaser of a Note, (b)
any holder of a Note holding more than 5% of the aggregate principal amount of
the Notes then outstanding, and (c) any bank, trust company, savings and loan
association or other financial institution, any pension plan, any investment
company, any insurance company, any broker or dealer, or any other similar
financial institution or entity, regardless of legal form.

     "Intercreditor Agreement" is defined in Section 4.10.

     "Interest Expense" of the Parent and its Subsidiaries for any period means
all interest expense (including the interest component on Rentals on Capital
Leases) determined in accordance with GAAP and all amortization of debt discount
(excluding debt discount with respect to the "Warrant" as defined in the Credit
Agreement) and expense on any particular Debt (including, without limitation,
payment-in-kind, zero coupon and other like securities) for which such
calculations are being made. Computations of Interest Expense on a pro forma
basis for Debt having a variable interest rate shall be calculated at the rate
in effect on the date of any determination.

     "Investments" means all investments, in cash or by delivery of property,
made directly or indirectly in any property or assets or in any Person, whether
by acquisition of shares of capital stock, Debt or other obligations or
securities or by loan, advance, capital contribution or otherwise; provided that
"Investments" shall not mean or include routine investments in property to be
used or consumed in the ordinary course of business.

     "Lease Expense" of the Parent and its Subsidiaries for any period means all
lease expenses (excluding the interest component on Rentals on Capital Leases)
determined in accordance with GAAP.

     "LIBOR" shall have the meaning assigned thereto in the Credit Agreement.

     "Lien" means, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement or Capital Lease, upon or
with respect to any property or asset of such Person (including in the case of
stock, stockholder agreements, voting trust agreements and all similar
arrangements).

     "LIFO Reserve" means the difference between (a) inventory at the lower of
LIFO cost or market and (b) inventory at replacement cost (as measured by the
Company using average costs) or market, all as computed in accordance with GAAP.

     "Make-Whole Amount" is defined in Section 8.7.

     "Management Stockholder Affiliates" mean, at any time, and with respect to
any Person who is a Management Stockholder any other Person that at such time
directly or indirectly through one or more intermediaries Controls, or is
Controlled by, or is under common Control with, such Management Stockholder. As
used in this definition, "Control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise.

                                        7

<PAGE>

     "Management Stockholders" means Robert G. Matheny, Anthony J. Cavanna,
Andrew W. Ferrari, Roger A. Wittenberg, Harold F. Monahan, Paul D. Fletcher,
Joseph L. Bradford, William R. Gupp, and David W. Jordan and their respective
Management Stockholder Affiliates, individually and collectively.

     "Material" means material in relation to the business, operations, affairs,
financial condition, assets, properties, or prospects of the Company and its
Subsidiaries taken as a whole.

     "Material Adverse Effect" means a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Parent and its Subsidiaries taken as a whole, or (b) the ability of the Company
to perform its obligations under this Agreement and the Notes, or (c) the
validity or enforceability of this Agreement or the Notes.

     "Material Subsidiary" means collectively each Domestic Subsidiary that is a
member of the Material Subsidiary Group.

     "Material Subsidiary Group" as of any date means either (a) the smallest
number of Domestic Subsidiaries that account for (or in the case of a recently
formed or acquired Domestic Subsidiary would so account for on a pro forma
historical basis), when combined with the Company, at least 90% of Consolidated
EBITDA for either of the two most recently ended fiscal years of the Company, or
(b) the smallest number of Domestic Subsidiaries that account for (or in the
case of a recently formed or acquired Domestic Subsidiary would so account for
on a pro forma historical basis), when combined with the Company, at least 90%
of Consolidated Adjusted Net Worth for either of the two most recently ended
fiscal years of the Company; provided that any Domestic Subsidiary that accounts
for (or in the case of a recently formed or acquired Domestic Subsidiary would
so account for on a pro forma historical basis) 7-1/2% of either Consolidated
EBITDA for either of the two most recently ended fiscal years of the Company or
Consolidated Adjusted Net Worth for either of the past two most recently ended
fiscal years of the Company, shall be included in the Material Subsidiary Group.

     "Memorandum" is defined in Section 5.3.

     "Minority Interests" means any shares of stock of any class of a Subsidiary
(other than directors' qualifying shares as required by law) that are not owned
by the Parent and/or one or more of its Subsidiaries. Minority Interests shall
be valued by valuing Minority Interests constituting Preferred Stock at the
voluntary or involuntary liquidating value of such Preferred Stock, whichever is
greater, and by valuing Minority Interests constituting common stock at the book
value of capital and surplus applicable thereto adjusted, if necessary, to
reflect any changes from the book value of such common stock required by the
foregoing method of valuing Minority Interests in Preferred Stock.

     "Multiemployer Plan" means any Plan that is a "multiemployer plan" (as such
term is defined in section 4001(a)(3) of ERISA).

     "Notes" is defined in Section 1.

     "Officer's Certificate" means a certificate of a Senior Financial Officer
or of any other officer of the Company whose responsibilities extend to the
subject matter of such certificate.

                                        8

<PAGE>

     "Other Purchasers" is defined in Section 2.

     "Parent" means Trex Company, Inc., a Delaware corporation.

     "PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.

     "Permitted Collateral Release" means a release of all of the Collateral
from the lien of the Collateral Documents in accordance with the terms and
provisions of Section 22.

     "Person" means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, or a government or
agency or political subdivision thereof.

     "Plan" means an "employee benefit plan" (as defined in section 3(3) of
ERISA) that is or, within the preceding five years, has been established or
maintained, or to which contributions are or, within the preceding five years,
have been made or required to be made, by the Company or any ERISA Affiliate or
with respect to which the Company or any ERISA Affiliate may have any liability.

     "Preferred Stock" means any class of capital stock of a corporation that is
preferred over any other class of capital stock of such corporation as to the
payment of dividends or the payment of any amount upon liquidation or
dissolution of such corporation.

     "Priority Debt" means (a) Funded Debt of any Subsidiary (other than TREX
LLC) plus (without duplication) (b) Funded Debt of the Company or any Subsidiary
which is incurred after Closing secured by a Lien under and pursuant to Section
10.3(l). Without limitation of the foregoing, Real Estate Term Loan 4 (as
defined in the Credit Agreement) shall be considered to be Priority Debt.

     "Pro Forma Basis" means, for any period of determination thereof, without
duplication,

     (a) if the Company or any Subsidiary has issued any Debt excluding
borrowings under the Revolving Credit Facility as defined in the Credit
Agreement made in the ordinary course of business and not in connection with or
in view of or in anticipation of any acquisition of assets or the making of any
Investment since the beginning of such period that remains outstanding on the
last day of such period or if the transaction giving rise to the need to
calculate Consolidated Cash Flow or Consolidated Fixed Charges is an issuance of
Debt, or both, Consolidated Cash Flow and Consolidated Fixed Charges for such
period shall be calculated after giving effect on a pro forma basis to such Debt
as if such Debt had been issued on the first day of such period;

     (b) if since the beginning of such period the Company or any Subsidiary (by
merger or otherwise) shall have made an Investment in any of the Company's
Subsidiaries (or any Person which becomes a Subsidiary of the Company) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder,
Consolidated Cash Flow and Consolidated Fixed Charges for such period shall be
calculated after giving pro forma effect thereto (including the issuance of any
Debt) as if such Investment or acquisition occurred on the first day of such
period;

                                        9

<PAGE>

     (c) there shall be excluded from Consolidated Fixed Charges any
Consolidated Fixed Charges related to any amount of Debt that was outstanding
during such period or thereafter but that is not outstanding or is to be repaid
on the date of determination; and

     (d) with respect to any such period commencing prior to any proposed
acquisition, the proposed acquisition shall be deemed to have taken place on the
first day of such period.

     For purposes of this definition, whenever Pro Forma Basis is to be applied
to an acquisition of assets, the amount of income or earnings relating thereto,
and the amount of Consolidated Fixed Charges associated with any Debt issued in
connection therewith, pro forma calculations shall be determined in good faith
by a responsible financial or accounting officer of the Company, which
determination shall, if the Required Holders so request, be confirmed by the
independent accountants of the Company.

     If any Debt bears a floating rate of interest and is being applied on a Pro
Forma Basis, the interest on such Debt shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the entire
period (taking into account any interest rate agreement applicable to such Debt
if such interest rate agreement has a remaining term in excess of twelve
months).

     "property" or "properties" means, unless otherwise specifically limited,
real or personal property of any kind, tangible or intangible, choate or
inchoate.

     "QPAM Exemption" means Prohibited Transaction Class Exemption 84-14 issued
by the United States Department of Labor.

     "Qualified Replacement Credit Agreement" means an agreement (and all
amendments, restatements, supplements and modifications thereof) under and
pursuant to which Debt of the Company is issued and which satisfies the
following conditions: (a) the Debt issued thereunder shall be revolving in
nature; (b) the covenants and events of default contained therein shall be not
more onerous than those set forth in the Credit Agreement as in effect on the
Closing; (c) the interest rates (including default interest rates), or if such
rates are imposed by reference to LIBOR or some other reference rate, the
margins over LIBOR or such other reference rate, imposed therein shall be not
higher than 100 basis points over the comparative rates set forth in the Credit
Agreement as in effect on the Closing, (d) such Debt is secured by the
Collateral under and pursuant to the Collateral Documents, (e) the obligees of
such Debt are parties to the Intercreditor Agreement, and (f) the Credit
Agreement in effect on the date hereof as may have been amended, renewed or
extended shall have been terminated and all amounts due thereunder shall have
been paid in full.

     "Qualified Replacement Bank Lender" means any and all lenders which are
parties to a Qualified Replacement Credit Agreement.

     "Required Holders" means, at any time, the holders of at least 51% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates).

                                       10

<PAGE>

     "Responsible Officer" means any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.

     "Rolling Four Quarters" means a period of four consecutive fiscal quarters
treated as a single accounting period.

     "Secured Obligations" has the meaning set forth in the Intercreditor
Agreement.

     "Secured Parties" has the meaning set forth in the Intercreditor Agreement.

     "Securities Act" means the Securities Act of 1933, as amended from time to
time.

     "Security" has the meaning set forth in section 2(l) of the Securities Act
of 1933, as amended.

     "Security Agreement" means the Security Agreement between the Company and
the Collateral Agent, in substantially the form of Exhibit 4.10 attached hereto.

     "Senior Financial Officer" means the chief financial officer, principal
accounting officer, treasurer, comptroller or vice-president of finance of the
Company.

     "Stockholders' Equity" means, as of the date of any determination thereof
the amount of the capital stock accounts (net of treasury stock, at cost) plus
(or minus in the case of a deficit) the surplus in retained earnings of the
Parent and its Subsidiaries as determined in accordance with GAAP.

     "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
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 such partnership can and does ordinarily take major
business actions without the prior approval of such Person or 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.

     "Swaps" means, with respect to any Person, payment obligations with respect
to interest rate swaps, currency swaps and similar obligations obligating such
Person to make payments, whether periodically or upon the happening of a
contingency. For the purposes of this Agreement, the amount of the obligation
under any Swap shall be the amount determined in respect thereof as of the end
of the then most recently ended fiscal quarter of such Person, based on the
assumption that such Swap had terminated at the end of such fiscal quarter, and
in making such determination, if any agreement relating to such Swap provides
for the netting of amounts payable by and to such Person thereunder or if any
such agreement provides for the simultaneous payment of amounts by and to such
Person, then in each such case, the amount of such obligation shall be the net
amount so determined.

                                       11

<PAGE>

     "TREX LLC" means TREX Company, LLC, a Delaware limited liability company.

     "Voting Stock" means, with respect to any Person, capital stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.

     "Wholly-Owned Subsidiary" means, at any time, any Subsidiary one hundred
percent (100%) of all of the equity interests (except directors' qualifying
shares or investments by foreign nationals mandated by applicable law) and
voting interests of which are owned by any one or more of the Company and the
Company's other Wholly-Owned Subsidiaries at such time.

                                       12

<PAGE>

                                 [FORM OF NOTE]

                               Trex Company, Inc.
                                Trex Company, LLC

                   8.32% Senior Secured Note Due June 19, 2009

No. [_____]                                                        June 19, 2002
$[_______]                                                       PPN 89531@ AA 7

     FOR VALUE RECEIVED, the undersigned, Trex Company, Inc., a corporation
organized and existing under the laws of the State of Delaware and TREX COMPANY,
LLC, a limited liability company organized and existing under the laws of the
State of Delaware (hereinafter collectively referred to as the "Company"),
hereby jointly and severally promise to pay to [___________], or registered
assigns, the principal sum of [___________] DOLLARS on June 19, 2009, with
interest (computed on the basis of a 360-day year of twelve 30-day months) (a)
on the unpaid balance thereof at the rate of 8.32% per annum from the date
hereof, payable semiannually, on the 19th day of December and June in each year,
commencing with the December next succeeding the date hereof, until the
principal hereof shall have become due and payable, and (b) to the extent
permitted by law on any overdue payment (including any overdue prepayment) of
principal, any overdue payment of interest and any overdue payment of any
Make-Whole Amount (as defined in the Note Purchase Agreements referred to
below), payable semiannually as aforesaid (or, at the option of the registered
holder hereof, on demand), at a rate per annum from time to time equal to the
greater of (i) 10.32% or (ii) 2.00% over the rate of interest publicly announced
by [name of reference bank] from time to time in New York, New York as its
"base" or "prime" rate.

     Payments of principal of, interest on and any Make-Whole Amount with
respect to this Note are to be made in lawful money of the United States of
America at [ ] or at such other place as the Company shall have designated by
written notice to the holder of this Note as provided in the Note Purchase
Agreement referred to below.

     This Note is one of a series of Senior Secured Notes (herein called the
"Notes") issued pursuant to the Note Purchase Agreement, dated as of June 19,
2002 (as from time to time amended, the "Note Purchase Agreement"), between the
Company and the respective Purchasers named therein and is entitled to the
benefits thereof. Each holder of this Note will be deemed, by its acceptance
hereof, (i) to have agreed to the confidentiality provisions set forth in
Section 20 of the Note Purchase Agreement and (ii) to have made the
representations set forth in Section 6 of the Note Purchase Agreement.

     This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the

                                  Exhibit 4.10

<PAGE>

Company may treat the person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment and for all other purposes, and the
Company will not be affected by any notice to the contrary.

     The Company will make required prepayments of principal on the dates and in
the amounts specified in the Note Purchase Agreement. This Note is also subject
to optional prepayment, in whole or from time to time in part, at the times and
on the terms specified in the Note Purchase Agreement, but not otherwise.

     This Note is equally and ratably secured by the Collateral Documents (as
defined in the Note Purchase Agreement). Reference is hereby made to the
Collateral Documents for a description of the collateral thereby mortgaged,
warranted, bargained, sold, released, conveyed, assigned, transferred, pledged
and hypothecated, the nature and extent of the security for the Notes, the
rights of the holders of the Notes, the Collateral Agent (as defined in the Note
Purchase Agreement) in respect of such security and otherwise.

     If an Event of Default, as defined in the Note Purchase Agreement, occurs
and is continuing, the principal of this Note may be declared or otherwise
become due and payable in the manner, at the price (including any applicable
Make-Whole Amount) and with the effect provided in the Note Purchase Agreement.

     This Note shall be construed and enforced in accordance with, and the
rights of the parties shall be governed by, the law of the State of New York
excluding choice-of-law principles of the law of such State that would require
the application of the laws of a jurisdiction other than such State.

                                              Trex Company, Inc.

                                              By:_______________________________
                                              Name:_____________________________
                                              Title:____________________________

                                              TREX Company, LLC

                                              By:_______________________________
                                              Name:_____________________________
                                              Title:____________________________

                                    9.6(b)-2<PAGE>

                                                                    Exhibit 10.2

                                CREDIT AGREEMENT

                                      among

                               TREX COMPANY, LLC,

                               TREX COMPANY, INC.

                                       and

                  BRANCH BANKING AND TRUST COMPANY OF VIRGINIA

                            Dated as of June 19, 2002

<PAGE>
Table of Contents

<TABLE>
<S>                                                                                                              <C>
ARTICLE I      DEFINITIONS.....................................................................................    4

   Section 1.01.  Definitions..................................................................................    4
                  -----------
   Section 1.02.  Accounting Terms and Determinations.  .......................................................    4
                  -----------------------------------

ARTICLE II     THE CREDIT......................................................................................    5

   Section 2.01.  Commitment to Lend...........................................................................    9
                  ------------------
   Section 2.02.  Methods of Borrowing.........................................................................    9
                  --------------------
   Section 2.03.  Funding of Revolving Loans...................................................................    9
                  --------------------------
   Section 2.04.  Revolving Note...............................................................................    9
                  --------------
   Section 2.05.  Interest Rate................................................................................   10
                  -------------
   Section 2.06.  Unused Commitment Fee........................................................................   10
                  ---------------------
   Section 2.07.  Adjustments of Commitment....................................................................   10
                  -------------------------
   Section 2.08.  Maturity and Repayment of Loan...............................................................   11
                  ------------------------------
   Section 2.09.  General Provisions as to Payments............................................................   12
                  ---------------------------------
   Section 2.10.  Computation of Interest and Fees.............................................................   12
                  --------------------------------

ARTICLE III    COLLATERAL......................................................................................   12

ARTICLE IV     CONDITIONS......................................................................................   13

   Section 4.01.  Conditions to Closing........................................................................   13
                  ---------------------
   Section 4.02.  Conditions to All Loans......................................................................   18
                  -----------------------

ARTICLE V      REPRESENTATIONS AND WARRANTIES..................................................................   19

   Section 5.01.  Existence and Power..........................................................................   19
                  -------------------
   Section 5.02.  Company and Governmental Authorization; No Contravention.....................................   19
                  --------------------------------------------------------
   Section 5.03.  Binding Effect...............................................................................   20
                  --------------
   Section 5.04.  Financial Condition..........................................................................   20
                  -------------------
   Section 5.05.  Litigation...................................................................................   20
                  ----------
   Section 5.06.  Regulation U; Use of Proceeds................................................................   21
                  -----------------------------
   Section 5.07.  Regulatory Restrictions on Borrowing.........................................................   21
                  ------------------------------------
   Section 5.08.  Subsidiaries.................................................................................   21
                  ------------
   Section 5.09.  Full Disclosure..............................................................................   21
                  ---------------
   Section 5.10.  Tax Returns and Payments.....................................................................   22
                  ------------------------
   Section 5.11.  Compliance With ERISA........................................................................   22
                  ---------------------
   Section 5.12.  Intellectual Property........................................................................   22
                  ---------------------
   Section 5.13.  No Burdensome Restrictions...................................................................   22
                  --------------------------
   Section 5.14.  Environmental Matters........................................................................   23
                  ---------------------
   Section 5.19   Material Contracts...........................................................................   24
                  ------------------
</TABLE>
                                       i

<PAGE>

<TABLE>
<S>                                                                                                              <C>
ARTICLE VI    COVENANTS........................................................................................   24

   Section 6.01.  Information..................................................................................   24
                  -----------
   Section 6.02.  Payment of Obligations.......................................................................   28
                  ----------------------
   Section 6.03.  Maintenance of Property; Insurance...........................................................   28
                  ----------------------------------
   Section 6.04.  Conduct of Business and Maintenance of Existence.............................................   29
                  ------------------------------------------------
   Section 6.05.  Compliance With Laws.........................................................................   29
                  --------------------
   Section 6.06.  Accounting; Inspection of Property, Books and Records........................................   29
                  -----------------------------------------------------
   Section 6.07.  Restrictions on Liens........................................................................   29
                  ---------------------
   Section 6.08.  Restrictions on Debt.........................................................................   31
                  --------------------
   Section 6.09.  Limitations on Capital Expenditures..........................................................   32
                  -----------------------------------
   Section 6.10.  Total Consolidated Debt to Total Consolidated Capitalization Ratio...........................   32
                  ------------------------------------------------------------------
   Section 6.11.  Total Consolidated Debt to Consolidated EBITDA Ratio.........................................   33
                  ----------------------------------------------------
   Section 6.12.  Fixed Charge Coverage Ratio..................................................................   33
                  ---------------------------
   Section 6.13.  Minimum Tangible Net Worth...................................................................   33
                  --------------------------
   Section 6.14.  Consolidations, Mergers and Sales of Assets..................................................   33
                  -------------------------------------------
   Section 6.15.  Investments; Acquisitions....................................................................   34
                  -------------------------
   Section 6.16.  Payments, Etc................................................................................   36
                  -------------
   Section 6.17.  Use of Proceeds..............................................................................   38
                  ---------------
   Section 6.18.  Transactions With Other Persons..............................................................   38
                  -------------------------------
   Section 6.19.  Location of Finished Goods Inventory.........................................................   38
                  ------------------------------------
   Section 6.20.  Deposit Accounts.............................................................................   38
                  ----------------
   Section 6.21.  Compliance With Agreements...................................................................   38
                  --------------------------
   Section 6.22.  More Favorable Covenants.....................................................................   38
                  ------------------------
   Section 6.23.  Additional Pledge Agreement, Security Agreement, and Guaranty Agreement Documentation........   39
                  -------------------------------------------------------------------------------------
   Section 6.24.  Transactions with Affiliates.................................................................   42
                  ----------------------------
   Section 6.25.  Further Assurances.. ........................................................................   42
                  ------------------
   Section 6.26.  Independence of Covenants....................................................................   42
                  -------------------------

ARTICLE VII   DEFAULTS.........................................................................................   42

   Section 7.01.  Events of Default............................................................................   42
                  -----------------

ARTICLE VIII  CHANGE IN CIRCUMSTANCES..........................................................................   44

   Section 8.01.  Illegality...................................................................................   44
                  ----------
   Section 8.02.  Base Rate Loans Substituted for Affected LIBOR Loans.........................................   45
                  ----------------------------------------------------

ARTICLE IX    MISCELLANEOUS....................................................................................   45

   Section 9.01.  Notices......................................................................................   45
                  -------
   Section 9.02.  Expenses; Indemnity..........................................................................   45
                  -------------------
   Section 9.03.  No Waivers...................................................................................   46
                  ----------
   Section 9.04.  Amendments and Waivers.......................................................................   46
                  ----------------------
   Section 9.05.  Successors and Assigns.......................................................................   46
                  ----------------------
   Section 9.06.  Governing Law................................................................................   46
                  -------------
</TABLE>

                                      -ii-

<PAGE>

<TABLE>
<S>                                                                                                              <C>
   Section 9.07.  Arbitration; Submission to Jurisdiction......................................................   46
                  ---------------------------------------
   Section 9.08.  Obligations Joint and Several................................................................   47
                  -----------------------------
   Section 9.09.  Counterparts; Integration; Effectiveness.....................................................   47
                  ----------------------------------------
   Section 9.10.  Confidentiality..............................................................................   47
                  ---------------
   Section 9.11.  Severability; Modification...................................................................   48
                  --------------------------
</TABLE>

                                     -iii-

<PAGE>

                                CREDIT AGREEMENT

     THIS CREDIT AGREEMENT is dated as of June 19, 2002, by and among TREX
COMPANY, LLC, a Delaware limited liability company, TREX COMPANY, INC., a
Delaware corporation (collectively, the "Borrower") and BRANCH BANKING AND TRUST
COMPANY OF VIRGINIA, a Virginia banking corporation (the "Bank").

                              STATEMENT OF PURPOSE

     The Borrower has applied to the Bank for (i) a revolving credit facility,
with a letter of credit subfacility, in the aggregate amount of Twenty Million
Dollars ($20,000,000.00) for working capital financing of the Borrower's
accounts receivable and inventory, to purchase new equipment and/or for other
general corporate purposes of the Borrower, (ii) a term loan facility in the
amount of Nine Million Five Hundred Seventy Thousand Seventy-Nine and 58/100s
Dollars ($9,570,079.88) to refinance the Winchester Property, and (iii) a term
loan facility in the amount of Three Million Twenty-Nine Thousand Nine Hundred
Twenty and 12/100s Dollars ($3,029,920.12) to finance existing improvements to
the Winchester Property. The Bank has agreed to extend such credit facilities to
the Borrower on the terms and conditions contained in this Agreement.

     NOW, THEREFORE, for and in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby mutually acknowledged, the Borrower and the Bank hereby agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

     Section 1.01.  Definitions. All capitalized terms used in this Agreement or
in any Appendix, Schedule or Exhibit hereto which are not otherwise defined
herein or therein shall have the respective meanings set forth in the Appendix
attached hereto identified as the Definitions Appendix. The Definitions Appendix
is incorporated herein by reference in its entirety and is a part of this
Agreement to the same extent as if it had been set forth in this Section 1.01 in
full.

     Section 1.02.  Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared, in accordance with GAAP,
applied on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the audited consolidated financial
statements of the Borrower and its Consolidated Subsidiaries referred to in
Section 5.04(a) hereof. In the event of any material change in generally
accepted accounting principles from those used in the preparation of the audited
consolidated financial statements of the Borrower and its Consolidated
Subsidiaries referred to in Section 5.04(a) hereof, the Borrower shall, at the
request of the Bank, provide to the Bank a reconciliation of financial
statements prepared pursuant to generally accepted accounting principles as in
effect on the date of the preparation of

<PAGE>

such statements with what such financial statements would have been had they
been prepared in accordance with the accounting principles used in the
preparation of the audit report referred to in Section 5.04(a) hereof.

                                   ARTICLE II
                                   THE CREDIT

     Section 2.01.  Commitment To Lend.

     (a)  Term Loans. The Bank agrees, on the terms and conditions set forth in
this Agreement, to make (i) a term loan to the Borrower on the Closing Date in
the principal amount of Three Million One Hundred Forty-Five Thousand One
Hundred Thirty-Four and 57/100s Dollars ($3,145,134.57) ("Real Estate Term Loan
1"), (ii) a term loan to the Borrower on the Closing Date in the principal
amount of Eight Hundred Eighty-One Thousand Four Hundred Ninety-Nine and 67/100s
Dollars ($881,499.67) ("Real Estate Term Loan 2"), (iii) a term loan to the
Borrower on the Closing Date in the principal amount of Five Million Five
Hundred Forty-Three Thousand Four Hundred Forty-Five and 64/100s Dollars
($5,543,445.64) ("Real Estate Term Loan 3") and (iv) a term loan to the Borrower
on the Closing Date in the principal amount of Three Million Twenty-Nine
Thousand Nine Hundred Twenty and 12/100s Dollars ($3,029,920.12) ("Real Estate
Term Loan 4").

     (b)  Revolving Commitment. The Bank agrees, on the terms and conditions set
forth in this Agreement, to make Revolving Loans to the Borrower from time to
time during the Revolving Credit Period in amounts such that the aggregate
principal amount of Revolving Loans at any one time outstanding will not exceed
the lesser of (i) the available Borrowing Base minus the Letter of Credit
Obligations and (ii) the Revolving Commitment minus the Letter of Credit
Obligations. Within the foregoing limit, the Borrower may borrow, prepay and
reborrow Revolving Loans at any time during the Revolving Credit Period.

     (c)  Borrowing Base. Revolving Loans will be subject to monthly borrowing
base reporting.

          i.   "Borrowing Base" means (A) the sum of (1) 85.00% of the net
               amount of Eligible Accounts plus (2) the lesser of (a) 60.00% of
               the value of Eligible Inventory and (B) the Inventory Sublimit,
               minus (B) the amount of any Reserves required by the Bank.

          ii.  "Eligible Account" means an account receivable which is (a) (1)
               for the period April 1 to and including November 30 in any year,
               not more than 60 days from the date of the original invoice and
               (2) for the period December 1 of any year to and including March
               31 of the immediately following year, not more than 90 days from
               the date of the original invoice and (b) at all times, not more
               than 45 days from the due date of the original invoice that
               arises in the ordinary course of the Borrower's business, is on
               normal and customary terms in the Borrower's business (which
               customary terms include customer incentives), and meets the
               following eligibility requirements:

                                      -5-

<PAGE>

               1. the sale of goods or services reflected in such account
     receivable is final and such goods and services have been provided to the
     carrier for shipment to the account debtor and payment for such is owing;

               2. the invoices comprising an account receivable are not subject
     to any known claims, credits, adjustments, allowances, returns or disputes
     of any kind;

               3. the account debtor is not insolvent or the subject of any
     bankruptcy proceedings;

               4. the account debtor has its principal place of business in the
     United States; provided, however, that the foregoing eligibility
     requirements shall not apply to (a) any accounts receivable in an aggregate
     amount of $1,000,000 or less that are stated in United States Dollars and
     are due from account debtors that have their principal place of business in
     Canada, (b) accounts receivable stated in United States Dollars owed by
     DENPLAX S.A. in an aggregate amount of $100,000 or less and (c) accounts
     receivable stated in United States Dollars which are fully supported by
     letters of credit issued by United States banks or other financial
     institutions acceptable to the Bank in its reasonable discretion;

               5. the account debtor is not an Affiliate and is not a supplier
     to the Borrower and the account receivable is not otherwise exposed to risk
     of setoff, defense, counterclaim or recoupment;

               6. the account receivable is not subject to any assignment,
     security interest, lien, claim, or encumbrance of any kind other than the
     lien and security interest of the Collateral Agent;

               7. the account receivable does not arise out of sales on a
     bill-and-hold, guaranteed sale, sale or return, sale on approval or
     consignment basis and the account receivable is not subject to any known
     right of return, set-off or charge-back;

               8. the account receivable is not owing from an account debtor
     that is an agency, department or instrumentality of the United States or
     any state governmental authority in the United States ("Governmental
     Account"); provided, however, that the foregoing eligibility requirements
     shall not apply to (a) any Governmental Accounts in an aggregate amount of
     $1,000,000 or less or (b) any Governmental Account that has been assigned
     to the Collateral Agent in accordance with the Federal Assignment of Claims
     Act and/or other applicable federal or state laws, rules and regulations
     relating to the assignment or payment of such Account and as to which the
     Borrower has taken all such other and further action as the Collateral
     Agent shall have required with respect to the assignment of such Account;

               9. the account receivable does not arise out of a C.O.D. sale;

                                      -6-

<PAGE>

               10. the account receivable does not arise out of a conditional
     sales agreement or other agreement pursuant to which the Borrower has
     retained title to the goods sold or a lien thereon to secure payment of the
     account receivable;

               11. the account receivable is not payable by an account debtor
     having 50% or more in face value of its then existing accounts receivable
     with the Borrower ineligible hereunder; and

               12. the account receivable does not represent an account
     receivable that the Borrower has determined in good faith may not be valid
     or collectible or may be doubtful in amount, and such account receivable is
     not otherwise unacceptable to the Bank, in its reasonable discretion.

          iii. "Eligible Inventory" means inventory of finished goods in the
               Borrower's possession (i) that is held for use or sale in the
               ordinary course of the Borrower's business, (ii) which is
               physically located in the continental United States on premises
               owned by the Borrower (or, if such premises are owned by a third
               Person, such Person has waived or subordinated any landlord's
               lien it may have in a form satisfactory to the Bank and its
               counsel), (iii) for which the Borrower has not received a
               prepayment, (iv) which has not been returned to the Borrower by
               any purchaser thereof, (v) which is of a kind normally and
               customarily sold by the Borrower and which is not, because of
               age, unmerchantability, obsolescence or any other condition or
               circumstance, materially impaired in condition, value, or
               marketability in the good faith opinion of the Borrower, (vi)
               which is not subject to any assignment, security interest, lien,
               claim, or encumbrance of any kind other than the lien and
               security interest of the Collateral Agent, (vii) which meets all
               standards imposed by any Governmental Authority having regulatory
               authority over such inventory, its use and/or sale, (viii) which
               has not been consigned to any Person, (ix) which does not bear,
               incorporate or is otherwise subject to any trademark, patent or
               copyright which is not owned by the Borrower, unless such
               trademark, patent or copyright is licensed to the Borrower on
               terms and conditions satisfactory to the Bank, (x) for which no
               warehouse receipt has been issued with respect thereto, and (xi)
               which is not otherwise unacceptable to the Bank, in its
               reasonable discretion. The value of the inventory will be valued
               at the lower of cost or market on a first-in, first-out basis as
               determined in accordance with GAAP applied on a consistent basis.

          iv.  "Reserves" means such amounts as may be required by the Bank, at
               any time and from time to time without prior notice to the
               Borrower, which the Bank deems, in its sole but reasonable
               discretion, to be adequate to reserve against outstanding letters
               of credit, outstanding banker's

                                      -7-

<PAGE>

               acceptances, the Borrower's obligations to the Bank or any of the
               Bank's affiliates or any guaranties or other contingent debts of
               the Borrower.

     (d) Letter of Credit Facility. Upon the terms and subject to the conditions
contained in this Agreement and in the applicable Letter of Credit Applications,
the Bank agrees to issue irrevocable letters of credit (hereinafter with the
Existing Letter of Credit shall collectively be referred to as the "Letters of
Credit") for the account of the Borrower (or either of them) from time to time
during the period from the date of this Agreement through but excluding the
Revolving Credit Termination Date, provided that the amount available for
drawing under all outstanding Letters of Credit plus the aggregate unpaid
reimbursement obligations under the Letter of Credit Applications shall not
exceed at any time outstanding the least of (i) $1,500,000, (ii) the Revolving
Commitment minus the aggregate principal amount of all outstanding Revolving
Loans, and (iii) the Borrowing Base minus the aggregate principal amount of all
outstanding Revolving Loans.

               (1)  Documentation. (a) Commercial Letters of Credit. Not less
than three (3) Business Days prior to the date a commercial Letter of Credit is
to be issued for its account, the Borrower will complete, execute and deliver to
the Bank an Application and Agreement for Commercial Letter of Credit (each, a
"Commercial Letter of Credit Application"), each on the Bank's then current form
with the blanks therein appropriately completed, and such other documents as the
Bank may reasonably require in connection therewith. Each commercial Letter of
Credit issued by the Bank will be subject to the terms and conditions of the
Commercial Letter of Credit Application pursuant to which it is issued as well
as the terms and conditions of this Agreement. In the event of a conflict
between the provisions of a Commercial Letter of Credit Application and the
provisions of this Agreement, the provisions of this Agreement will govern.

                    (b)  Standby Letters of Credit. Not less than five (5)
Business Days prior to the date a standby Letter of Credit is to be issued for
its account, the Borrower will complete, execute and deliver to the Bank an
Application and Agreement for Standby Letter of Credit (each, a "Standby Letter
of Credit Application"), each on the Bank's then current form with the blanks
therein appropriately completed, and such other documents as the Bank may
reasonably require in connection therewith. Each standby Letter of Credit issued
by the Bank will be subject to the terms and conditions of the Standby Letter of
Credit Application pursuant to which it is issued as well as the terms and
conditions of this Agreement. In the event of a conflict between the provisions
of the Standby Letter of Credit Application and the provisions of this
Agreement, the provisions of this Agreement will govern.

               (2)  Fees. For each Letter of Credit issued under the terms of
this Agreement (other than the Existing Letter of Credit), the Borrower will pay
to the Bank at the time of issuance a fee computed on the amount of such Letter
of Credit at the rate equal to one percent (1%) per annum subject to any minimum
fees that the Bank may impose. Such fee will be fully earned at the time such
Letter of Credit is issued and nonrefundable. The Borrower will also pay to the
Bank when due its customary administrative fees as they may be established or
altered from time to time for issuing Letters of Credit and for honoring drafts
thereunder and, if applicable, for transferring, amending or extending such
Letters of Credit. Nothing contained

                                      -8-

<PAGE>

herein, however, shall obligate the Bank to transfer, amend or extend beyond its
original maturity date any Letter of Credit.

               (3)  Reimbursement Obligations. The Borrower will pay to the Bank
promptly upon demand any and all amounts paid by the Bank under any Letter of
Credit, as provided in the applicable Letter of Credit Application, together
with interest on such amount from the date such amount was paid by the Bank to
the date it receives payment in federal or other immediately available funds at
LIBOR plus the Applicable Revolving Loan Margin, with such rate to be reset on
each day on which there is a change to LIBOR. Such interest shall be computed
for the actual number of days elapsed over a year of 360 days.

               (4)  Expiration of Letters of Credit. Unless the Bank shall
otherwise agree, each commercial Letter of Credit issued under the provisions of
this Agreement shall expire not later than six (6) months after its date of
issuance, each standby Letter of Credit issued under the provisions of this
Agreement shall expire not later than one (1) year after its date of issuance
(exclusive of automatic renewal or "evergreen" features) and in any event all
Letters of Credit shall expire on or before the Revolving Credit Termination
Date.

     Section 2.02.  Methods of Borrowing.

     (a)  Notice of Borrowing. Except as otherwise provided in this Section
and/or the Services Agreement, the Borrower may, with the approval of the Bank,
give the Bank notice substantially in the form of Exhibit A hereto (a "Notice of
Borrowing") not later than 12:00 noon (local time in Winchester, Virginia) on
the date of each requested Revolving Loan, specifying the date of such Revolving
Loan (which shall be a Business Day) and the amount of such Revolving Loan
(which shall be in the minimum amount of $100,000 or a whole multiple of
$100,000 in excess thereof).

     (b)  Cash Management Services. The Borrower subscribes to the Bank's cash
management services and such services will be applicable to the Revolving Loans.
The terms of such services, as set forth in the Services Agreement, shall
control the manner in which funds are transferred between the Operating Account
and the Revolving Loans for credit or debit to the Revolving Loans.

     (c)  Overdrafts in Other Accounts. The Bank may, at its option, pay any
Item which will cause any deposit account maintained by the Borrower with the
Bank to become overdrawn; and such payment shall be deemed a Revolving Loan
hereunder.

     Section 2.03.  Funding of Revolving Loans. The Bank shall disburse the
proceeds of each Revolving Loan made pursuant to Section 2.01 as follows: the
proceeds of each Revolving Loan under Section 2.01 shall be made available by
the Bank to the Borrower in federal or other funds immediately available at the
Bank's Winchester, Virginia address referred to in Section 9.01.

     Section 2.04.  Revolving Note.

                                      -9-

<PAGE>

     (a)  Evidence of Revolving Loans. The Revolving Loans and the Borrower's
obligation to repay the Revolving Loans shall be evidenced by the Revolving Note
payable to the order of the Bank in an amount equal to the Revolving Commitment
and dated as of the Closing Date.

     (b)  Records of Amounts Due. The Bank shall record the date and amount of
each Revolving Loan made by it and the date and amount of each payment of
principal made by the Borrower with respect thereto, and may, if the Bank so
elects in connection with any transfer or enforcement of the Revolving Note,
endorse on any schedule forming a part thereof appropriate notations to evidence
the foregoing information with respect to each such Revolving Loan then
outstanding, provided that the failure of the Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower hereunder or
under the Revolving Note. The Bank is hereby irrevocably authorized by the
Borrower so to endorse the Revolving Note and to attach to and make a part of
the Revolving Note a continuation of any such schedule as and when required.

     Section 2.05.  Interest Rate.

     (a)  Revolving Loans. From the date hereof until and including June 30,
2005, each Revolving Loan shall bear interest on the outstanding principal
amount thereof, for each day from the date such Revolving Loan is made until it
becomes due, at a rate per annum equal to LIBOR for such day plus the Applicable
Revolving Loan Margin. Such interest shall be due and payable for each month in
arrears on the first Business Day of the immediately succeeding calendar month.

     (b)  Real Estate Term Loans 1, 2, 3 & 4. From the date hereof until and
including June 30, 2005, each of Real Estate Term Loans 1, 2, 3 & 4 shall bear
interest on the unpaid principal balance thereof, payable monthly in arrears at
a rate per annum equal to LIBOR plus the Applicable Real Estate Term Loan
Margin.

     (c)  Default Rate. Upon the occurrence and during the continuance of an
Event of Default, all Loans shall bear interest, payable on demand, at a rate
per annum equal to 2 1/2% over the rate, as calculated above, applicable to such
Loan on such day (the "Default Rate").

     Section 2.06. Unused Commitment Fee. The Borrower shall pay to the Bank
quarterly in arrears on each Quarterly Date and on the Revolving Credit
Termination Date, an unused commitment fee (the "Unused Commitment Fee") equal
to the Unused Commitment Fee Percentage on the average daily Unused Amount of
the Revolving Commitment for such calendar quarter (or portion thereof in the
case of the payment of the Unused Commitment Fee due on June 30, 2002) on the
basis of a year of 360 days for the actual number of days elapsed.

     Section 2.07. Adjustments of Commitment.

     (a)  Optional Reduction of Revolving Commitment. The Borrower may at any
time and from time to time, upon at least three Business Days' notice to the
Bank, permanently reduce (i) the Revolving Commitment to $0 or (ii) the
Revolving Commitment in excess of the aggregate outstanding principal amount of
the Revolving Loans in an aggregate principal amount

                                      -10-

<PAGE>

of $1,000,000 or any whole multiple of $1,000,000 in excess thereof; provided
that if the Revolving Commitment is not reduced to $0, the amount of the
Revolving Commitment shall not be reduced to an amount less than $5,000,000. Any
reduction of the Revolving Commitment to $0 shall be accompanied by payment of
all outstanding Revolving Credit Loan Obligations and furnishing of cash
collateral to the Bank for all Letter of Credit Obligations.

     (b)  Mandatory Reduction of Revolving Commitment. Not later than thirty
(30) calendar days after the Borrower's or the Bank's receipt of any Personal
Property Casualty Loss Proceeds or Net Proceeds and not later than 210 calendar
days after the Borrower's receipt of any Fixed Asset Proceeds that are not
reinvested in accordance with the provisions of Section 6.14(b)(ii), the
Borrower shall repay, or the Bank shall pay, as applicable, the Revolving Loans
in immediately available funds in an amount equal to such Personal Property
Casualty Loss Proceeds, Net Proceeds or Fixed Asset Proceeds, and the Revolving
Commitment shall permanently be reduced by the amount of such payment; provided,
however, that (i) the foregoing provisions shall not apply to Personal Property
Casualty Loss Proceeds received by the Collateral Agent under the Security
Agreement, if and so long as, pursuant to the terms of the Security Agreement,
such Personal Property Casualty Loss Proceeds are to be (A) held by the
Collateral Agent and disbursed for the restoration, repair or replacement of the
property in respect of which such proceeds were received or remitted to the
Borrower or (B) held by the Collateral Agent as security for, or applied by the
Collateral Agent to the reduction of, the Secured Obligations (as defined in the
Intercreditor Agreement), and (ii) if required by the terms of the Note
Agreement, Fixed Asset Proceeds shall be applied to the repayment of the Secured
Obligations on a pro rata basis.

     Section 2.08. Maturity and Repayment of Loans.

     (a)  Maturity of Revolver on Revolving Credit Termination Date. Each
Revolving Loan shall mature, and the principal amount thereof shall be due and
payable, on the Revolving Credit Termination Date.

     (b)  Prepayment of Revolving Loans. (1)Optional Prepayment. If the Bank has
elected to have the Services Agreement apply to the Revolving Loans, the
Revolving Loans shall be repaid as set forth in the Services Agreement, and
consistent with this Agreement. If the Bank has not elected to have the Services
Agreement apply to the Revolving Loans, the Borrower shall have the right to
prepay all or any part of the Revolving Loans in immediately available funds on
any Business Day.

               (2)  Mandatory. If, at any time, the aggregate principal amount
of Revolving Loans exceeds the lesser of (i) the available Borrowing Base minus
the Letter of Credit Obligations and (ii) the Revolving Commitment minus the
Letter of Credit Obligations, the Borrower will immediately prepay the Revolving
Loans in an amount sufficient to eliminate such excess.

     (c)  Real Estate Term Loans 1, 2, 3 & 4. Real Estate Term Loans 1, 2, 3 & 4
shall be due and payable as set forth in Real Estate Term Loan Note 1, Real
Estate Term Loan Note 2, Real Estate Term Loan Note 3 and Real Estate Term Loan
4, respectively; provided that the

                                      -11-

<PAGE>

principal balance of Real Estate Term Loans 1, 2, 3 & 4, together with all
accrued interest thereon, shall be immediately due and payable in full on June
30, 2005.

     (d)  Optional Prepayment of Real Estate Term Loans. Provided that with
respect to Real Estate Term Loans 1, 2, 3 & 4, the Borrower shall indemnify the
Bank against the Bank's loss or expense in employing deposits as a consequence
of the Borrower's payment or prepayment of any of Real Estate Term Loans 1, 2, 3
or 4 on any Business Day that is not the final Business Day of any calendar
month, the Borrower may, upon at least one (1) Business Day's notice to the
Bank, prepay Real Estate Term Loans 1, 2, 3 or 4, in whole at any time, or from
time to time in part, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment. The notice of prepayment
delivered by the Borrower to the Bank shall be irrevocable by the Borrower
following its receipt by the Bank. Any prepayment of Real Estate Term Loan 1, 2,
3 or 4 shall be applied to the principal payments due under Real Estate Term
Loan 1, 2, 3 or 4 (as applicable) in the inverse chronological order of their
maturities.

     (e)  Mandatory Prepayment of Real Estate Term Loans. Not later than thirty
(30) calendar days after the Borrower's or the Bank's receipt of any Winchester
Property Casualty Loss Proceeds, the Borrower shall repay, or the Bank shall
pay, as applicable, the Real Estate Term Loans in immediately available funds in
an amount equal to such Winchester Property Casualty Loss Proceeds in such order
of application as the Bank shall elect, in its sole discretion; provided,
however, that the foregoing provisions shall not apply to Winchester Property
Casualty Loss Proceeds received by the Bank under the Deed of Trust, if and so
long as, pursuant to the terms of the Deed of Trust, such Winchester Property
Casualty Loss Proceeds are to be held by the Bank and disbursed for the
restoration, repair or replacement of the property in respect of which such
proceeds were received.

     Section 2.09. General Provisions as to Payments. The Borrower shall make
each payment of principal of and interest on the Loans and fees hereunder not
later than 12:00 noon (local time in Winchester, Virginia) on the date when due,
without setoff, counterclaim or other deduction, in federal or other funds
immediately available to the Bank at its Winchester, Virginia address referred
to in Section 9.01 or such other location as designated by the Bank. Whenever
any payment of principal of, or interest on, the Loans or of fees shall be due
on a day which is not a Business Day, the date for payment thereof shall be
extended to the next succeeding Business Day. If the date for any payment of
principal is extended by operation of law or otherwise, interest thereon shall
be payable for such extended time.

     Section 2.10. Computation of Interest and Fees. Interest on the Loans
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).

                                   ARTICLE III
                                   COLLATERAL

     Section 3.01  Revolving Credit Collateral. The Revolving Credit Loan
Obligations shall be secured as follows:

                                      -12-

<PAGE>

     (a)  A first priority security interest in and lien on all of the personal
property business assets of any type and description of the Borrower, including
any property or acquisitions, whether now owned of hereafter acquired and
wherever located, as more particularly described in the Security Agreement; and

     (b)  To the extent required by Section 6.23 hereof, a first priority lien
on all stock of, member interests in or equivalent equity interests in, and the
guaranty of, each Material Subsidiary.

     Section 3.02 Real Estate Loan Collateral. The Real Estate Term Loan
Obligations shall be secured by a first priority deed of trust lien on the
Winchester Property, as more particularly described in the Deed of Trust.

                                   ARTICLE IV
                                   CONDITIONS

     Section 4.01. Conditions to Closing. The obligation of the Bank to enter
into this Agreement and to make the initial Revolving Loan and to make Real
Estate Term Loans 1, 2 & 3 hereunder are subject to the satisfaction of the
following conditions:

     (a)  Effectiveness. This Agreement shall have become effective as of the
date hereof.

     (b)  Notes. On or prior to the Closing Date, the Bank shall have received a
duly executed Revolving Note, Real Estate Term Loan 1 Note, Real Estate Term
Loan 2 Note, Real Estate Term Loan 3 Note, and Real Estate Term Loan 4 Note,
each dated as of the Closing Date and complying with the provisions of Section 2
hereof.

     (c)  Other Loan Documents. Each of the Loan Documents to be executed on or
before the Closing Date shall be in form and substance satisfactory to the Bank
and its counsel and shall have been duly executed and delivered to the Bank by
each of the parties thereto.

     (d)  Notice of Borrowing. If applicable, with respect to the initial
Revolving Loan, the Bank shall have received from the Borrower a Notice of
Borrowing in accordance with Section 2.02(a).

     (e)  Borrowing Base Certificate. On the Closing Date, the Bank shall have
received a Borrowing Base Certificate based on May 31, 2002 information, if
available, and if information as of May 31, 2002 is not available, the Borrowing
Base Certificate shall be based on April 30, 2002 information.

     (f)  Compliance Certificate. On the Closing Date, the Bank shall have
received a Compliance Certificate based on March 31, 2002 information, and a
certificate of the chief financial officer containing the information required
by Section 6.01(c)(i)(B) and Section 6.01(c)(ii) based on April 30, 2002
information.

                                      -13-

<PAGE>

     (g)  Adverse Change, Etc. On the Closing Date, nothing shall have occurred
(and the Bank shall not have become aware of any facts or conditions not
previously known) which has, or could reasonably be expected to have, a Material
Adverse Effect.

     (h)  Officer's Certificate. The Bank shall have received a certificate
dated the Closing Date signed on behalf of the Borrower by the Chairman of the
Board, the President, any Vice President or the Treasurer of the Borrower
stating that (i) on the Closing Date and after giving effect to the Loans being
made on the Closing Date, and to this Agreement, no Default or Event of Default
shall have occurred and be continuing and (ii) to the best knowledge and belief
of such officer, the representations and warranties of the Borrower contained in
the Loan Documents are true and correct on and as of the Closing Date.

     (i)  Opinion of Counsel. On the Closing Date, the Bank shall have received
from counsel to the Borrower a favorable opinion addressed to the Bank, dated
the Closing Date, and in form and substance satisfactory to the Bank with
respect to the Borrower and the Loan Documents and such additional matters
incident to the transactions contemplated hereby as the Bank may request.

     (j)  Borrower's Proceedings.

          (i)  On the Closing Date, the Bank shall have received for TREX
Company, LLC: (A) a copy of its certificate of formation, as amended, certified
by the Secretary of State of Delaware and dated as of a recent date prior to the
Closing Date; (B) a certificate of the Secretary of State of Delaware and each
other state (including without limitation Virginia) in which it is qualified as
a foreign limited liability company to do business, dated as of a recent date
prior to the Closing Date, as to the good standing of TREX Company, LLC; (C) a
copy of its operating agreement, including all amendments thereto; and (D) a
certificate of the appropriate officer or other authorized person of TREX
Company, LLC dated the Closing Date and certifying (1) that the documents
referred to in clause (C) above have not been amended since the date of said
certificate, (2) that attached thereto is a true, correct and complete copy of
resolutions and consents adopted by its sole member authorizing the execution,
delivery and performance of the Loan Documents and each other document delivered
in connection herewith and that said resolutions have not been amended or
rescinded and are in full force and effect on the date of such certificate, (3)
as to the incumbency and specimen signatures of its officer or other authorized
person executing the Loan Documents or any other document delivered in
connection herewith and (4) certifying as to the names and respective
jurisdictions of organization of all of its Subsidiaries existing on the Closing
Date. All company and legal proceedings and instruments and agreements relating
to the transactions contemplated by this Agreement or in any other document
delivered in connection herewith shall be satisfactory in form and substance to
the Bank and its counsel, and the Bank shall have received all information and
copies of all documents and papers, including records of company proceedings,
Governmental Approvals and good standing certificates which the Bank reasonably
may have requested in connection therewith, such documents and papers where
appropriate to be certified by proper company or governmental authorities.

                                      -14-

<PAGE>

          (ii) On the Closing Date, the Bank shall have received for Trex
Company, Inc.: (A) a copy of its articles of incorporation, as amended,
certified by the Secretary of State of Delaware and dated as of a recent date
prior to the Closing Date; (B) a certificate of the Secretary of State of
Delaware and each other state (including without limitation Virginia) in which
it is qualified as a foreign corporation to do business, dated as of a recent
date prior to the Closing Date, as to the good standing of Trex Company, Inc.;
(C) a copy of its by-laws, including all amendments thereto; and (D) a
certificate of the appropriate officer or other authorized person of Trex
Company, Inc. dated the Closing Date and certifying (1) that the documents
referred to in clause (C) above have not been amended since the date of said
certificate, (2) that attached thereto is a true, correct and complete copy of
resolutions adopted by its directors authorizing the execution, delivery and
performance of the Loan Documents and each other document delivered in
connection herewith and that said resolutions have not been amended or rescinded
and are in full force and effect on the date of such certificate, (3) as to the
incumbency and specimen signatures of its officer executing the Loan Documents
or any other document delivered in connection herewith and (4) certifying as to
the names and respective jurisdictions of organization of all of its
Subsidiaries existing on the Closing Date.

          All corporate and legal proceedings and instruments and agreements
relating to the transactions contemplated by this Agreement or in any other
document delivered in connection herewith shall be satisfactory in form and
substance to the Bank and its counsel, and the Bank shall have received all
information and copies of all documents and papers, including records of company
proceedings, Governmental Approvals and good standing certificates which the
Bank reasonably may have requested in connection therewith, such documents and
papers where appropriate to be certified by proper company or governmental
authorities.

     (k)  Perfection of Security Interests; Search Reports. On or prior to the
Closing Date, the Bank shall have received:

          (1)  appropriate Financing Statements (Form UCC-l or such other
financing statements or similar notices as shall be required by local law)
appropriately completed for filing under the Uniform Commercial Code or other
applicable local law of each jurisdiction in which the filing of a financing
statement or giving of notice may be required, or reasonably requested by the
Bank, to perfect the Liens purported to be created by the Loan Documents;

          (2)  appropriate filings for the perfection of the Lien on
intellectual property purported to be created by the Loan Documents;

          (3)  the Deed of Trust fully executed for filing under the applicable
local laws of each jurisdiction in which the Deed of Trust is required to be
filed by the Bank to perfect the Liens purported to be created thereby;

          (4)  Certificates of satisfaction or other appropriate release
documents sufficient to terminate the Liens in favor of Wachovia Bank, National
Association (formerly known as First Union National Bank), and any other
lienholder on the Winchester Property and to terminate the Liens in favor of all
lienholders on the Borrower's property located in Lyon

                                      -15-

<PAGE>

County, Nevada (other than the Lien held by Bank of America, N.A.) and written
authority to file the same; and

          (5)  copies of reports from Prentice-Hall Financial Services or other
independent search service reasonably satisfactory to the Bank listing all
effective financing statements that name the Borrower or any of its Subsidiaries
(under its present name and any previous name and, if requested by the Bank,
under any trade names) as debtor or seller that are filed in Delaware, Nevada or
Virginia, together with copies of such financing statements filed in Delaware,
Nevada or Virginia (none of which shall cover the Collateral (as that term is
defined in the Security Agreement)) except to the extent evidencing Permitted
Liens or for which the Bank shall have received financing statement amendments
(Form UCC-3) or such other termination statements as shall be required by local
law and written authority to file the same.

     (l)  ISDA Master Agreement. On or prior to the Closing Date, the Borrower
shall have executed and delivered all documents, instruments and certificates
associated with the ISDA Master Agreement.

     (m)  Letter of Credit Documents. If applicable, on or prior to the Closing
Date, the Borrower shall have executed and delivered all documents, instruments
and certificates required by the Bank to issue the Letters of Credit.

     (n)  Intercreditor Agreement. On or prior to the Closing Date, the Borrower
and all other parties thereto shall have executed and delivered the
Intercreditor Agreement.

     (o)  Appraisal. On or prior to the Closing Date, the Bank shall have
received an MAI appraisal of the Winchester Property, which appraisal shall
comply with all rules and regulations of any Governmental Authorities regulating
the Bank, shall be in form and substance satisfactory to the Bank in all
respects, and shall state a fair market value of not less than $16,800,000.

     (p)  Survey. On or prior to the Closing Date, the Bank shall have received
a current survey of the Winchester Property satisfactory to the Bank, showing no
encroachments and prepared by a certified land surveyor (using certification
language satisfactory to the Bank), which survey shall designate, without
limitation, (i) the dimensions of the Winchester Property, (ii) the dimensions
and location of the buildings and other improvements constructed thereon, (iii)
the dimensions of the parking spaces as well as the total number of parking
spaces, (iv) the location of all easements of record affecting the Winchester
Property, specifying the holder of such easement and the pertinent recording
information, (v) any and all building restrictions and/or setback lines, and
(vi) means of ingress and egress. Such survey shall also certify that no portion
of the Winchester Property is located in a special flood hazard area.

     (q)  Title Insurance. On or prior to the Closing Date, the Bank shall have
received (i) a policy of mortgagee title insurance insuring the lien of the Deed
of Trust as a first priority deed of trust lien on the Winchester Property in
the amount of $12,600,000, issued by a title insurance company acceptable to the
Bank, without exception for possible filed or unfiled mechanics' and
materialmen's liens, containing only such exceptions as are acceptable to the
Bank, and

                                      -16-

<PAGE>

containing such endorsements and affirmative coverage as are requested by the
Bank, and (ii) copies of all instruments that appear as exceptions to title on
such policy.

     (r)  Environmental Report. On or prior to the Closing Date, the Borrower
shall have delivered to the Bank a report from a qualified environmental
engineer or consultant acceptable to the Bank with respect to an environmental
investigation and audit of the Winchester Property (the scope of which shall be
defined by the Bank), showing no contamination of the Winchester Property by
Hazardous Substances, no violation of any Environmental Law, and that no portion
of the Winchester Property constitutes "wetlands" under any Environmental Law.

     (s)  Evidence of Insurance. On or prior to the Closing Date, the Borrower
shall have delivered to the Bank evidence satisfactory to the Bank that all
insurance required by the terms of this Agreement or any of the other Loan
Documents is in full force and effect and the Collateral Agent or the Bank, as
applicable, is named as loss payee or additional insured, as appropriate, on all
such insurance.

     (t)  Evidence of Termination of First Union Loan Agreement. On or prior to
the Closing Date, the Borrower shall have delivered evidence satisfactory to the
Bank that the First Union Loan Agreement has been terminated and all Debt owed
by the Borrower to First Union National Bank has been paid in full.

     (u)  Evidence of Consummation of Note Agreement. On or prior to the Closing
Date, the Borrower shall have delivered a true and correct copy of the fully
executed Note Agreement to the Bank, the terms of which shall be satisfactory to
the Bank in all respects; and the Borrower shall have delivered evidence
satisfactory to the Bank that the transactions contemplated by the Note
Agreement shall have been consummated and that the gross proceeds resulting from
the consummation of the transactions contemplated by the Note Agreement are not
less than $40,000,000.

     (v)  March 31, 2002 Financial Statements. On or prior to the Closing Date,
the Borrower shall have delivered to the Bank financial statements complying
with Section 6.01(b) for the fiscal quarter ended March 31, 2002 and certified
as required by Section 6.01(b), and the Bank shall have determined that such
financial statements are in form, content and express results that are
satisfactory to the Bank in its sole opinion.

     (w)  Novation Agreement. On or prior to the Closing Date, Wachovia Bank,
National Association (formerly known as First Union National Bank) shall have
executed and delivered an agreement with respect to Branch Banking and Trust
Company's undertaking to make payments under the existing ISDA Master Agreement
between the Borrower and Wachovia Bank, National Association (formerly known as
First Union National Bank), which agreement shall be in form and substance
acceptable to the Bank.

     (x)  Services Agreement. On or prior to the Closing Date, the Borrower
shall have executed and delivered the Services Agreement.

                                      -17-

<PAGE>

     (y) Severance Agreement. On or prior to the Closing Date, Bank of America,
N.A. shall have executed and delivered a release agreement in form and substance
acceptable to the Bank, pursuant to which Bank of America, N.A. agrees that all
equipment and inventory (other than fixtures excluding manufacturing and
production equipment) now or hereafter located on the Borrower's real property
located in Lyon County, Nevada is not subject to the mortgage lien held by Bank
of America, N.A. on such real property.

     (z)  Payment of Fees. All costs, fees and expenses due to the Bank on or
before the Closing Date (including, without limitation, the upfront revolving
credit fee in the amount of $150,000 and the upfront term loan fee in the amount
of $126,000, and the legal fees and expenses) shall have been paid.

     (aa) Counsel Fees. The Bank shall have received payment from the Borrower
of the reasonable fees and expenses of Troutman Sanders LLP described in Section
9.02 which are billed through the Closing Date.

     (bb) Other Documents. The Borrower shall have delivered to the Bank such
other documents, certificates and opinions as the Bank or its counsel requests,
certified (if applicable) by the chief executive officer, chief financial
officer, secretary or other officer of the Borrower as the Bank shall direct as
a true and correct copy thereof.

     Section 4.02. Conditions to All Loans. The obligation of the Bank to make
each Loan is subject to the satisfaction of the following conditions:

     (a)  the fact that the Closing Date shall have occurred;

     (b)  (i) with respect to each Revolving Loan, the fact that, immediately
after the making of such Loan, the aggregate outstanding principal amount of all
Revolving Loans will not exceed the lesser of (A) the available Borrowing Base
minus the Letter of Credit Obligations and (B) the Revolving Commitment minus
the Letter of Credit Obligations; and (ii) with respect to the Borrower's first
request for a Revolving Loan after each occurrence of any fire, theft, water
damage, vandalism or other damage to or loss of any Inventory for which
insurance proceeds are paid to the Borrower or the Collateral Agent, the
Borrower shall have executed and delivered to the Bank a new Borrowing Base
Certificate based on information as of the date of such request;

     (c)  the fact that, immediately before and after the making of such Loan,
no Default or Event of Default shall have occurred and be continuing;

     (d)  the fact that the representations and warranties of the Borrower
contained in this Agreement shall be true in all material respects on and as of
the date of such Loan or, if given with respect to a specific date, as of such
date; and

     (e)  (i) the Bank shall in good faith have determined that its prospect of
receiving payment in full of the Revolving Credit Loan Obligations or the Real
Estate Term Loan Obligations then outstanding or its ability to exercise its
rights and remedies hereunder and under the other Loan Documents has not been
impaired, (ii) no event or condition shall have occurred

                                      -18-

<PAGE>

since the Effective Date which had or could reasonably be expected to have a
Material Adverse Effect and (iii) the Bank shall not reasonably suspect that one
or more Defaults or Events of Default shall have occurred and be continuing.

     Each Loan hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Loan as to the facts specified in clauses (d)
and (e) of this Section.

                                   ARTICLE V
                         REPRESENTATIONS AND WARRANTIES

     The Borrower represents and warrants that:

     Section 5.01. Existence and Power. TREX Company, LLC is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware and has all powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted. Trex Company, Inc. is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all powers
and all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted. Each of the Subsidiaries (i)
that is a Domestic Subsidiary is duly organized, validly existing and in good
standing under the laws of the state of its organization and has all powers and
all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted and (ii) that is a Foreign
Subsidiary is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its formation, to the extent such concepts are
applicable under the laws of such Foreign Subsidiary's jurisdiction of
formation, and has all powers and all material governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted. Each Borrower and the Subsidiaries is duly qualified as a foreign
entity, licensed and in good standing in each jurisdiction where qualification
or licensing is required by the nature of its business or the character and
location of its property, business or customers and in which the failure to so
qualify or be licensed, as the case may be, in the aggregate, could have a
Material Adverse Effect.

     Section 5.02. Company and Governmental Authorization; No Contravention.

     (a)  The execution, delivery and performance by TREX Company, LLC of the
Loan Documents to which it is a party are within its limited liability company
powers, have been duly authorized by all necessary company action, require no
action by or in respect of, or filing with, any governmental body, agency or
official (except for any such action or filing as shall have been taken or made
and that is in full force and effect from and after the Closing Date) and do not
contravene, or constitute (with or without the giving of notice or lapse of time
or both) a default under, any provision of applicable law or of the
organizational documents of TREX Company, LLC or of any agreement, judgment,
injunction, order, decree or other instrument binding upon or affecting TREX
Company, LLC or result in the creation or imposition of any Lien on any asset of
TREX Company, LLC except as stated herein.

                                      -19-

<PAGE>

     (b)  The execution, delivery and performance by Trex Company, Inc. of the
Loan Documents to which it is a party are within its corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official (except
for any such action or filing as shall have been taken or made and that is in
full force and effect from and after the Closing Date) and do not contravene, or
constitute (with or without the giving of notice or lapse of time or both) a
default under, any provision of applicable law or of the organizational
documents of Trex Company, Inc. or any Subsidiary or of any agreement, judgment,
injunction, order, decree or other instrument binding upon or affecting Trex
Company, Inc. or any Subsidiary or result in the creation or imposition of any
Lien on any asset of Trex Company, Inc. or any of its Subsidiaries, except as
stated herein.

     (c)  Each of TREX Company, LLC, Trex Company, Inc. and its Subsidiaries (i)
has all Governmental Approvals required by any applicable law for it to conduct
its business, each of which is in full force and effect, is final and is not
subject to review on appeal and is not the subject of any pending, or to the
knowledge of its management, threatened attack by direct or collateral
proceedings and (ii) is in compliance with each Governmental Approval applicable
to it, except where the failure to obtain such Governmental Approval or
non-compliance with any Governmental Approval could not reasonably be expected
to have a Material Adverse Effect.

     Section 5.03. Binding Effect. Each Loan Document other than the Notes to
which the Borrower is a party constitutes a valid and binding agreement of the
Borrower and each Note, when executed and delivered in accordance with this
Agreement, will constitute a valid and binding obligation of the Borrower, in
each case enforceable against the Borrower in accordance with its terms, except
in each case as such enforceability may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by equitable principles
of general applicability (regardless of whether such enforceability is
considered in a proceeding in equity or at law).

     Section 5.04. Financial Condition.

     (a)  Interim Financial Statements. The unaudited consolidated balance sheet
of Trex Company, Inc. and its Consolidated Subsidiaries as of March 31, 2002 and
the related unaudited consolidated income statements for the fiscal quarter then
ended, copies of which have been delivered to the Bank, fairly present, in
conformity with GAAP applied on a basis consistent with the audited financial
statements for the fiscal year ended December 31, 2001, the consolidated
financial position of Trex Company, Inc. and its Consolidated Subsidiaries as of
such date and their consolidated results of operations and changes in financial
position for such 12-month period (subject to normal year-end audit
adjustments).

     (b)  Material Adverse Change. Since March 31, 2002, there has been no
material adverse change in condition (financial or otherwise), results of
operations, properties, assets, business or prospects of Trex Company, Inc. or
Trex Company, Inc. and its Consolidated Subsidiaries, considered as a whole.

     Section 5.05. Litigation. Except as set forth on Schedule 5.05, there is no
material action, suit, proceeding or investigation pending against, or to the
knowledge of the Borrower

                                      -20-

<PAGE>

threatened against, contemplated or affecting, the Borrower or any of its
Subsidiaries before any court, arbitrator or governmental body, agency or
official which has, or could reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect, or which in any manner draws into
question the validity or enforceability of any of the Loan Documents, and there
is no basis known to the Borrower or any of its Subsidiaries for any such
action, suit, proceeding or investigation.

     Section 5.06. Regulation U; Use of Proceeds. The Borrower and its
Subsidiaries do not own any "margin stock" as such term is defined in Regulation
U. The proceeds of the Loans will be used by the Borrower only for the purposes
set forth in Section 6.17.

     Section 5.07. Regulatory Restrictions on Borrowing. Neither the Borrower
nor any of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as amended, or
otherwise subject to any regulatory scheme which restricts its ability to incur
debt.

     Section 5.08. Subsidiaries. Part I of Schedule 5.08 (as such Schedule may
be supplemented by a writing delivered by the Borrower to the Bank from time to
time after the Effective Date) hereto lists each Subsidiary of the Borrower (and
the direct and indirect ownership interests of the Borrower therein), in each
case existing on the Effective Date. Except as set forth on Part I of such
Schedule 5.08, each such Subsidiary existing on the date hereof is, and in the
case of any additional corporate Subsidiaries formed after the Effective Date
each of such additional corporate Subsidiaries will be at each time that this
representation is made or deemed to be made after the Effective Date, a
Wholly-Owned Subsidiary that is a corporation duly incorporated, validly
existing and, to the extent relevant in such jurisdiction, in good standing
under the laws of its jurisdiction of incorporation, and has all corporate
powers and all material Governmental Approvals required to carry on its business
as now conducted. Except as listed on Part II of Schedule 5.08 (as such Schedule
may be supplemented by a writing delivered by the Borrower to the Bank from time
to time after the Effective Date), neither the Borrower nor any of its
Subsidiaries are engaged in any joint venture or partnership with any other
Person. All outstanding shares, member interests or equivalent equity interests,
as applicable, of each Subsidiary (i) that is a Domestic Subsidiary have been
duly authorized and validly issued and are fully paid and nonassessable and (ii)
that is a Foreign Subsidiary have been duly authorized and validly issued and
are fully paid and nonassessable to the extent such concepts are applicable
under the laws of such Foreign Subsidiary's jurisdiction of formation. Except as
listed on Part III of Schedule 5.08 (as such Schedule may be supplemented by a
writing delivered by the Borrower to the Bank from time to time after the
Effective Date), as of May 31, 2002, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments or other rights of any
type or nature whatsoever, which are convertible into, exchangeable for or
otherwise provide for or permit the issuance of capital stock of the Borrower or
any of its Subsidiaries.

     Section 5.09. Full Disclosure. All factual information (taken as a whole)
furnished by or on behalf of the Borrower or any of its Subsidiaries in writing
to the Bank for purposes of or in connection with this Agreement or any
transaction contemplated hereby is true and accurate in all material respects on
the date as of which such information is dated or certified and is not

                                      -21-

<PAGE>

incomplete by omitting to state any material fact necessary to make such
information (taken as a whole) not misleading at such time in light of the
circumstances under which such information was provided. The Borrower has
disclosed to the Bank in writing any and all facts which materially and
adversely affect or may materially and adversely affect (to the extent the
Borrower can now reasonably foresee) the business, operations, prospects or
financial condition of Trex Company, Inc. and its Consolidated Subsidiaries
taken as a whole or the ability of the Borrower to perform its obligations under
this Agreement and the other Loan Documents.

     Section 5.10. Tax Returns and Payments. Each of the Borrower and its
Subsidiaries has filed all United States federal income tax returns and all
other material tax returns, domestic and foreign, required to be filed by it and
has paid all taxes and assessments payable by it which have become due pursuant
to such returns or pursuant to any assessment received by the Borrower or any
Subsidiary, other than those not yet delinquent and except for those contested
in good faith, by appropriate proceedings, and for which adequate reserves have
been established (in accordance with GAAP). Each of the Borrower and its
Subsidiaries has paid, or has provided adequate reserves (in the good faith
judgment of the management of the Borrower and in accordance with GAAP) for the
payment of, all federal, state and foreign income taxes applicable for all prior
fiscal years and for the current fiscal year to the date hereof.

     Section 5.11. Compliance With ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (a) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (b) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (c)
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.

     Section 5.12. Intellectual Property. Each of the Borrower and its
Subsidiaries owns or possesses or holds under valid noncancelable licenses all
patents, trademarks, service marks, trade names, copyrights, licenses and other
intellectual property rights that are necessary for the operation of their
respective properties and businesses, and neither the Borrower nor any of its
Subsidiaries is in violation of any provision thereof. Except as disclosed on
Schedule 5.12 (as such Schedule may be supplemented by a writing delivered by
the Borrower to the Bank from time to time after the Effective Date), the
Borrower and its Subsidiaries conduct their business without infringement or
claim of infringement of any material license, patent, trademark, trade name,
service mark, copyright, trade secret or any other intellectual property right
of others and there is no infringement or claim of infringement by others of any
material license, patent, trademark, trade name, service mark, copyright, trade
secret or other intellectual property right of the Borrower and its
Subsidiaries, in each case which could reasonably be expected to have a Material
Adverse Effect.

     Section 5.13. No Burdensome Restrictions. No contract, lease, agreement or
other instrument to which the Borrower or any of its Subsidiaries is a party or
by which any of its

                                      -22-

<PAGE>

property is bound or affected, no charge, corporate restriction, judgment,
decree or order and no provision of applicable law or governmental regulation
have had or are reasonably expected to have a Material Adverse Effect.

     Section 5.14. Environmental Matters. In the ordinary course of its
business, the Borrower conducts an ongoing review of the effect of Environmental
Laws on the business, operations and properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including, without limitation, any capital or operating
expenditures required for cleanup or closure of properties presently or
previously owned, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law or as
a condition of any license, permit or contract, any related constraints on
operating activities, including any periodic or permanent shutdown of any
facility or reduction in the level of or change in the nature of operations
conducted at any such facility, any costs or liabilities in connection with
off-site disposal of wastes or Hazardous Substances, and any actual or potential
liabilities to third parties, including employees, and any related costs and
expenses). On the basis of this review, the Borrower has reasonably concluded
that such associated liabilities and costs, including the costs of compliance
with Environmental Laws, are unlikely to have a Material Adverse Effect.

     Section 5.15  Title to Properties. The Borrower and each of its
Subsidiaries has good and indefeasible title to its real properties (other than
properties which it leases) and good title to all of its other properties and
assets, including the properties and assets reflected in the balance sheet for
the Borrower and its Consolidated Subsidiaries referred to in Section 5.04
(except for properties and assets disposed of in the ordinary course of
business), subject to no Lien of any kind except Liens permitted by Section
6.07.

     Section 5.16  No Defaults. Neither the Borrower nor any of its Subsidiaries
is in default of the principal of or any interest on any Material Debt, and
neither the Borrower nor any of its Subsidiaries is in default under any
instrument under or subject to which any such indebtedness has been incurred,
and no event has occurred under the provisions of any such instrument which,
with the giving of notice or the lapse of time, or both, would constitute an
event of default thereunder. No event has occurred and is continuing which
constitutes a Default or an Event of Default, and no event which constitutes, or
which with the giving of notice or the passage of time, or both, would
constitute, a default or an event of default under any Material Contract or
judgment, decree or order to which the Borrower or any of its Subsidiaries or
any of their respective properties may be bound or which would require the
Borrower or any of its Subsidiaries to make a payment thereunder prior to the
scheduled maturity therefor, except in cases in which any such default or event
of default would not, in any instance or in the aggregate, have a Material
Adverse Effect.

     Section 5.17  Employee Relations. Each of the Borrower and its Subsidiaries
has a reasonably stable work force in place. The Borrower knows of no pending,
threatened or contemplated strikes, work stoppage or other collective labor
disputes involving its employees or those of any of its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.

                                      -23-

<PAGE>

     Section 5.18  Solvency. As of the Closing Date and after giving effect to
the transactions contemplated by this Agreement, the Loan Documents and the Note
Agreement, the Borrower and each of its Subsidiaries, taken as a whole, is
Solvent.

     Section 5.19  Material Contracts. Except for the Loan Documents, the Note
Agreement and the Notes (as defined in the Note Agreement), Schedule 5.19 sets
forth a complete and accurate list of all Material Contracts of the Borrower and
its Subsidiaries in effect as of the Closing Date not listed on any other
Schedule hereto. Other than as set forth on Schedule 5.19, each such Material
Contract is, and after giving effect to the consummation of the transactions
contemplated by the Loan Documents will be, in full force and effect in
accordance with the terms thereof as of the Closing Date. The Borrower and its
Subsidiaries have made available for inspection by the Bank a true and complete
copy of each Material Contract required to be listed on Schedule 5.19 or any
other Schedule hereto as of the Closing Date.

     Section 5.20  Debt. Schedule 5.20 is a complete and correct listing of all
Material Debt other than Debt associated with the Revolving Credit Loan
Obligations, the Real Estate Term Loan Obligations or the Note Agreement. The
Borrower and its Subsidiaries have performed and are in compliance in all
material respects with all of the terms of all Debt and all instruments and
agreements relating thereto, and no default or event of default, or event which
with notice or lapse of time or both would constitute such a default or event of
default on the part of the Borrower or its Subsidiaries exists with respect to
any Debt.

                                   ARTICLE VI
                                    COVENANTS

     The Borrower agrees that, so long as the Bank has any commitment to make
Revolving Loans or any of Real Estate Term Loans 1, 2, 3 or 4, or any Revolving
Credit Loan Obligations or Real Estate Term Loan Obligations remain unpaid:

     Section 6.01. Information. The Borrower will deliver or cause to be
delivered to the Bank:

     (a)  Annual Financial Statements. As soon as available and in any event
within 90 days after the end of each fiscal year of the Borrower, a consolidated
and, with respect to Material Subsidiaries, consolidating balance sheet of Trex
Company, Inc. and its Consolidated Subsidiaries as of the end of such fiscal
year and the related consolidated and, with respect to Material Subsidiaries,
consolidating statements of income, changes in equity and cash flows for such
fiscal year, setting forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and satisfactory in form to the
Bank; provided that the Borrower may deliver, in lieu of the foregoing
consolidated annual financial statements only, the annual report of the Borrower
for the applicable fiscal year on Form 10-K filed with the SEC, but only so long
as the consolidated financial statements contained in such annual report are
substantially the same in content as the consolidated financial statements
required by this Section 6.01(a). The foregoing financial statements shall be
accompanied by an opinion thereon by Ernst & Young, LLP or other independent
certified public accountants reasonably satisfactory to the Bank, which opinion
shall not be qualified as to the scope of the audit and which shall state that
such consolidated financial statements present fairly the consolidated financial
position of Trex

                                      -24-

<PAGE>

Company, Inc. and its Consolidated Subsidiaries as of the date of such financial
statements and the results of their operations for the period covered by such
financial statements in conformity with GAAP applied an a consistent basis
(except for changes in the application of which such accountants concur) and
shall not contain any "going concern" or like qualification or exception or
qualification arising out of the scope of the audit In addition, within 30 days
after the end of each fiscal year, the Borrower shall provide to the Bank a copy
of its annual budget with a written summary of all material assumptions
contained therein, which budget shall be in substantially the same form as the
budget prepared for calendar year 2002, a copy of which has been delivered to
the Bank. If any event occurs or condition exists that has or could reasonably
be expected to have a Material Adverse Effect or that materially adversely
affects or could reasonably be expected to materially adversely affect such
annual budget, the Borrower shall, within 10 calendar days of such event,
provide the Bank with a forecast for the remainder of such calendar year that
(i) takes into account such event or condition, (ii) contains a written summary
of all material assumptions contained in such forecast and (iii) contains a
written summary of those assumptions that have changed from the original budget
provided to the Bank for such year.

     (b)  Quarterly Financial Statements. As soon as available and in any event
within 45 days after the end of each of the first three fiscal quarters of each
fiscal year of Trex Company, Inc., an internally prepared consolidated and, with
respect to Material Subsidiaries, consolidating balance sheet of Trex Company,
Inc. and its Consolidated Subsidiaries as of the end of such fiscal quarter
(with all supporting schedules) and the related consolidated and, with respect
to Material Subsidiaries, consolidating statements of income and cash flows of
Trex Company, Inc. and its Consolidated Subsidiaries for such quarter, setting
forth in each case in comparative form the figures for the corresponding quarter
of the previous fiscal year, all in reasonable detail and satisfactory in form
to the Bank; provided that the Borrower may deliver, in lieu of the foregoing
quarterly consolidated financial statements only, the quarterly report of the
Borrower for the applicable fiscal quarter on Form 10-Q filed with the SEC, but
only so long as the consolidated financial statements contained in such
quarterly report are substantially the same in content as the consolidated
financial statements required by this Section 6.01(b). The foregoing financial
statements shall be reviewed by Ernst & Young LLP or other independent certified
public accountants reasonably satisfactory to the Bank, and all certified
(subject to normal year-end audit adjustments) as to fairness of presentation,
GAAP and consistency by the chief financial officer or chief accounting officer
of Trex Company, Inc.

     (c)  Monthly Financial Statements. As soon as available and in any event
within 15 Business Days after (i) the end of each month: (A) a Borrowing Base
Certificate and (B) a financial report of accounts receivable (including an
aging of accounts receivable in an initial increment of 30 days, a second
increment of 31-45 days, a third increment of 46-60 days and in 30-day
increments thereafter), inventory and production; and (ii) the end of the first
two months of each fiscal quarter, an internally prepared consolidated and, with
respect to Material Subsidiaries, consolidating balance sheet of Trex Company,
Inc. and its Consolidated Subsidiaries and the related consolidated and, with
respect to Material Subsidiaries, consolidating statements of income and cash
flows of Trex Company, Inc. and its Consolidated Subsidiaries for such month all
in reasonable detail and satisfactory in form to the Bank and all

                                      -25-

<PAGE>

certified (subject to normal year-end audit adjustments) as to fairness of
presentation, GAAP and consistency by the chief financial officer or chief
accounting officer of Trex Company, Inc.

     (d)  Officer's Certificate. Simultaneously with the delivery of each set of
financial statements referred to in subsections (a) and (b) above, a Compliance
Certificate of the chief financial officer or chief accounting officer of Trex
Company, Inc., (i) if applicable, setting forth in reasonable detail the
calculations required to establish whether the Borrower was in compliance with
the requirements of Sections 6.09 to and including 6.13, on the date of such
financial statements, (ii) stating whether there exists on the date of such
certificate any Default or Event of Default and, if any Default or Event of
Default then exists, setting forth the details thereof and the action which the
Borrower is taking or proposes to take with respect thereto, and (iii) stating
whether, since the date of the most recent previous delivery of financial
statements pursuant to subsections (a) or (b) of this Section, any event has
occurred or condition exists that has had or could reasonably be expected to
have a Material Adverse Effect, and, if so, the nature of such event or
condition.

     (e)  Accountant's Certificate. Simultaneously with the delivery of each set
of financial statements referred to in subsection (a) above, a statement of the
firm of independent public accountants which reported on such statements whether
anything has come to its attention to cause it to believe that any Default
existed on the date of such statements with respect to Sections 6.10, 6.11, 6.12
or 6.13 hereof.

     (f)  Default, Event of Default or Material Adverse Effect. Forthwith upon
the occurrence of any Default or Event of Default or any event that results in a
Material Adverse Effect, a certificate of the chief financial officer or chief
accounting officer of the Borrower setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect thereto.

     (g)  Litigation. As soon as reasonably practicable after obtaining
knowledge of the commencement of an action, suit, proceeding or investigation
against the Borrower or any of its Subsidiaries which could reasonably be
expected to have a Material Adverse Effect or which in any manner questions the
validity of this Agreement, any of the Loan Documents or any of the transactions
contemplated by this Agreement or any of the Loan Documents, a certificate of
the chief financial officer or chief legal officer of the Borrower containing an
explanation of the nature of such pending or threatened action, suit, proceeding
or investigation and such additional information as may be reasonably requested
by the Bank.

     (h)  Auditors' Management Letters. Promptly upon receipt thereof, copies of
each report submitted to Trex Company, Inc. or its Consolidated Subsidiaries by
independent public accountants in connection with any annual, interim or special
audit made by them of the books of Trex Company, Inc. or its Consolidated
Subsidiaries, including, without limitation, each report submitted to Trex
Company, Inc. or its Consolidated Subsidiaries concerning its accounting
practices and systems and any final comment letter submitted by such accountants
to management in connection with the annual audit of Trex Company, Inc. or its
Consolidated Subsidiaries.

                                      -26-

<PAGE>

     (i)  ERISA Matters. If and when any member of the ERISA Group (i) gives or
is required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could
reasonably be expected to result in the imposition of a Lien or the posting of a
bond or other security, a certificate of the chief financial officer or the
chief accounting officer of the Borrower setting forth details as to such
occurrence and action, if any, which the Borrower or applicable member of the
ERISA Group is required or proposes to take.

     (j)  Environmental Matters. Promptly, upon receipt of any complaint, order,
citation, notice or other written communication from any Person with respect to,
or upon the Borrower's obtaining knowledge of, notice of (i) the existence or
alleged existence of a violation of any applicable Environmental Law in
connection with any property now or previously owned, leased or operated by the
Borrower or any of its Subsidiaries, (ii) any release on such property or any
part thereof in a quantity that is reportable under any applicable Environmental
Law and (iii) any pending or threatened proceeding for the termination,
suspension or nonrenewal of any permit required under any applicable
Environmental Law, in each such case under clause (i), (ii) or (iii) in which
there is a reasonable likelihood of an adverse decision or determination which
could result in a Material Adverse Effect, and the action which the Borrower is
taking or proposes to take with respect thereto.

     (k)  Labor Controversy. As soon as reasonably practicable after obtaining
knowledge of the occurrence of any labor controversy that has resulted in, or is
reasonably likely to result in, a strike or other material work stoppage against
the Borrower or any Subsidiary which is reasonably likely to have a Material
Adverse Effect, notice thereof and the action which the Borrower is taking or
proposes to take with respect thereto.

     (l)  Attachment. Notice of any attachment, judgment, nonconsensual Lien,
levy or order exceeding $250,000 that has been assessed against the Borrower or
any Subsidiary, and the action which the Borrower is taking or proposes to take
with respect thereto.

     (m)  Note Agreement. Notice of the occurrence of any default or event of
default under the Note Agreement, under any other agreement or note evidencing
Material Debt, or

                                      -27-

<PAGE>

under any Material Contract, in each case which remains uncured or unwaived
following the expiration of any applicable cure period, and the action which the
Borrower is taking or proposes to take with respect thereto.

     (n)  Representations. Notice of any event which makes any of the
representations set forth in Article V inaccurate in any material respect as of
the date given or deemed to have been given.

     (o)  SEC Filings. Promptly upon the distribution thereof, one copy of (i)
each financial statement, report, notice or proxy statement sent by the Borrower
or any Subsidiary to public security holders generally and (ii) each regular or
periodic report, registration statement (without exhibits other than on Form
S-8) and each prospectus and all amendments thereto filed by the Borrower or any
Subsidiary with the SEC and of all press releases and other written
communications available generally by the Borrower or any Subsidiary to the
public concerning material developments or developments that could reasonably be
expected to have a Material Adverse Effect.

     (p)  Other Information. From time to time such additional financial or
other information regarding the condition (financial or otherwise), results of
operations, properties, assets, business or prospects of the Borrower or its
Consolidated Subsidiaries as the Bank may reasonably request.

     Section 6.02. Payment of Obligations. The Borrower will pay, perform and
discharge, and will cause each of its Subsidiaries to pay, perform and
discharge, at or before their respective due dates, (a) all Revolving Credit
Loan Obligations and all Real Estate Term Loan Obligations, as applicable to
them, under this Agreement and the other Loan Documents, (b) all their
respective obligations, liabilities and indebtedness, including all claims or
demands of materialmen, mechanics, carriers, warehousemen, landlords and other
like persons which, in any such case, if unpaid, might by law give rise to a
Lien upon any of their properties or assets which could reasonably be expected
to have a Material Adverse Effect and (c) all lawful taxes, assessments and
charges or levies made upon their properties or assets, by any governmental
body, agency or official, except where any of the items in clause (b) or (c) of
this Section 6.02 may be diligently contested in good faith by appropriate
proceedings and the Borrower or such Subsidiary shall have set aside on its
books, if required under GAAP, appropriate reserves for the accrual of any such
items.

     Section 6.03. Maintenance of Property; Insurance.

     (a)  Maintenance of Properties. The Borrower will keep, and will cause each
of its Subsidiaries to keep, all property useful and necessary in their
respective businesses, taken as a whole, in good working order and condition,
subject to ordinary wear and tear.

     (b)  Insurance. In addition to the insurance requirements set forth in the
Deed of Trust and the Security Agreement, the Borrower will maintain, and will
cause each of its Subsidiaries to maintain, insurance with financially sound and
responsible companies in such amounts (and with such risk retentions and with
such deductibles) and against such risks as is usually carried by owners of
similar businesses and properties in the same general areas in which the
Borrower

                                      -28-

<PAGE>

and its Subsidiaries operate, and the Borrower will maintain not less than
$64,000,000 of business interruption insurance at all times (or such lesser
amount as the Bank may agree to in its reasonable discretion). The Bank shall be
named as loss payee and additional insured on all such insurance policies. Not
less frequently than annually and more frequently if the Bank shall so request,
the Borrower shall deliver to the Bank certificates evidencing that it is named
as loss payee and additional insured on all such insurance and the Borrower
shall promptly deliver such other information as the Bank shall reasonably
request from time to time.

     Section 6.04. Conduct of Business and Maintenance of Existence. Except as
otherwise permitted by Section 6.14 hereof, the Borrower will continue, and will
cause each of its Subsidiaries to continue, to engage in business of the same
general type as now conducted by the Borrower and its Subsidiaries (or
complementary thereto), and will preserve, renew and keep in full force and
effect, and will cause each of its Subsidiaries to preserve, renew and keep in
full force and effect, their respective corporate existence and their respective
rights, privileges and franchises (including without limitation their
qualification and good standing) necessary or desirable in the normal conduct of
business.

     Section 6.05. Compliance With Laws. The Borrower will comply, and will
cause each of its Subsidiaries to comply, with all applicable laws, ordinances,
rules, regulations and requirements of governmental authorities (including,
without limitation, Environmental Laws, ERISA and the rules and regulations
thereunder) and maintain, and cause each of its Subsidiaries to maintain, all
licenses, permits and Governmental Approvals, except (a) where the necessity of
compliance or maintenance therewith is contested in good faith by appropriate
proceedings or (b) where noncompliance or nonmaintenance could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.

     Section 6.06. Accounting; Inspection of Property, Books and Records. The
Borrower will keep, and will cause each of the Subsidiaries to keep, proper
books of record and account in which full, true and correct entries in
conformity with GAAP shall be made of all dealings and transactions in relation
to their respective businesses and activities, will maintain, and will cause
each of the Subsidiaries to maintain, their respective fiscal reporting periods
on the present basis and will permit, and will cause each of their respective
Subsidiaries to permit, representatives of the Bank to visit and inspect any of
their respective properties, to examine and make copies from any of their
respective books and records and to discuss their respective affairs, finances
and accounts with their officers, employees and independent public accountants,
including field audits of Accounts and Inventory, all at such reasonable times
and as often as may reasonably be desired, and further, if requested, the
Borrower and each of its Subsidiaries shall provide equipment and real estate
appraisals to the Bank for the Collateral. The costs of all field audits,
inspections and appraisals will be borne by the Borrower; provided, however,
that unless an Event of Default has occurred and is continuing, the Borrower
shall only be responsible for the payment of one such audit, inspection or
appraisal during each calendar year. Notwithstanding the above, the Borrower
shall be permitted to make adjustments to its books of record and accounts as
may be required or as may be requested by an audit or outside review, so long as
the purpose of such adjustment is to bring said books or accounts into
conformity with GAAP.

     Section 6.07. Restrictions on Liens. The Borrower will not, and will not
permit any of its Subsidiaries to, without the prior written consent of the
Bank, create, incur, assume or suffer

                                      -29-

<PAGE>

to exist any Lien upon or with respect to any Collateral, or other accounts, or
ownership interests in its Subsidiaries, or proceeds thereof, or sell any
Collateral, or other accounts or ownership interests in its Subsidiaries, or
proceeds thereof subject to an understanding or agreement, contingent or
otherwise, to repurchase such Collateral, or other accounts, or ownership
interests in its Subsidiaries, or proceeds thereof (including sales of accounts
receivable or notes with recourse to the Borrower or any of its Subsidiaries) or
assign any right to receive income, or file or permit the filing of any
financing statement under the Uniform Commercial Code as in effect in any
applicable jurisdiction or any other similar notice of Lien under any similar
recording or notice statute, provided that the provisions of this Section 6.07
shall not prevent the creation, incurrence, assumption or existence of the
following (with such Liens described below being herein referred to as
"Permitted Liens"):

     (a)  Lien in favor of Bank of America, N.A. encumbering Borrower's facility
located in Lyon County, Nevada (the "Nevada Real Estate"), which lien is
evidenced by that certain Deed of Trust, Assignment of Rents and Leases,
Security Agreement and Fixture Filing dated September 28, 1999 and recorded on
September 30, 1999 in the Official Records of Lyon County, Nevada as Document
No. 239622 (the "Nevada Deed of Trust"); and Liens securing any refinancing of
the Nevada Real Estate, provided that at the time of such refinancing, (i) no
Default or Event of Default has occurred or would occur as a result of such
refinancing, (ii) the Debt secured by the Nevada Deed of Trust does not exceed
100% of the fair market value of the Nevada Real Estate at the time of such
refinancing and (iii) the Debt secured thereby is permitted under this Agreement
(including without limitation under Section 6.08);

     (b)  Liens created by or permitted under the Loan Documents;

     (c)  Liens for taxes or assessments or other governmental charges not yet
due or Liens for taxes being contested in good faith and by appropriate
proceedings for which adequate reserves (in the good-faith judgment of the
management of the Borrower and in accordance with GAAP) have been established;

     (d)  Liens incurred in connection with worker's compensation, unemployment
insurance, or other social security obligations;

     (e)  Liens arising in connection with deposits or pledges to secure bids,
tenders, contracts (other than contracts for the payment of money), leases,
statutory obligations, surety or appeal bonds, and other obligations arising in
the ordinary course of business;

     (f)  mechanic's, worker's, materialman's, landlord's, carrier's, or other
like Liens arising in the ordinary course of business with respect to
obligations that are not due or that are being contested in good faith by
appropriate proceedings for which adequate reserves (in the good-faith judgment
of the management of the Borrower and in accordance with GAAP) have been
established;

     (g)  Liens on unearned insurance premiums held by Persons financing the
payment thereof;

                                      -30-

<PAGE>

     (h)  Liens of or resulting from any judgment or award, the time for the
appeal or petition for rehearing of which shall not have expired, or in respect
of which the Borrower or a Subsidiary shall at any time in good faith be
prosecuting an appeal or proceeding for a review and in respect of which a stay
of execution pending such appeal or proceeding for review shall have been
secured;

     (i)  minor survey exceptions or minor encumbrances, easements or
reservations, or rights of others for rights-of-way, utilities and other similar
purposes, or zoning or other restrictions as to the use of real properties,
which are necessary for the conduct of the activities of the Borrower and its
Subsidiaries or which customarily exist on properties of corporations engaged in
similar activities and similarly situated and which do not in any event
materially impair their use in the operation of the business of the Borrower and
its Subsidiaries;

     (j)  Liens securing Debt of any Subsidiary to the Borrower or to another
Wholly-Owned Subsidiary, provided that such Liens have been subordinated to all
Liens in favor of the Collateral Agent and/or the Bank pursuant to written
subordination agreements in form and substance satisfactory to the Collateral
Agent and the Bank; and

     (k)  Liens on fixed assets of the Borrower or any Subsidiary which secure
only Debt incurred to finance the acquisition of such fixed assets and Liens
existing on fixed assets at the time of acquisition by the Borrower of any
business entity then owning such fixed assets, whether by merger, consolidation
or acquisition of substantially all of its assets, and whether or not such
existing Liens were given to secure the payment of the purchase price of the
fixed assets to which they attach (but only to the extent that such Liens are
incurred substantially contemporaneously with the acquisition of such fixed
assets, only to the extent of the lesser of the fair market value or cost of
such fixed assets, and only to the extent that the Debt secured thereby is
permitted by this Agreement, including without limitation Section 6.08 hereof);

     (l)  Liens existing on the Closing Date and set forth on Schedule 4.9 to
the Security Agreement, and the extension, renewal or replacement of any such
Lien, provided that (i) such Lien attaches only to the same property as the
original Lien, (ii) the principal amount of Debt secured by such Lien is not
increased and (iii) at the time of such extension, renewal or replacement, no
Default or Event of Default shall have occurred and be continuing;

     (n)  Liens on the Revolving Credit Loan Collateral securing Debt incurred
within the limitations of Section 6.08(v);

     (o)  interests of lessors under Capital Leases; and

     (p)  in addition to the Liens permitted under clauses (a) to and including
(o) of this Section 6.07, Liens securing Debt that does not exceed $250,000 in
the aggregate.

     Section 6.08. Restrictions on Debt. The Borrower shall not create, incur,
assume or suffer to exist, or permit any Subsidiary to create, incur, assume or
suffer to exist, any Debt, except (i) Debt owing to the Bank or to Branch
Banking and Trust Company; (ii) Material Debt existing on the Closing Date and
described on Schedule 5.20, and any extension, renewal or

                                      -31-

<PAGE>

refinancing of such Material Debt, provided that any such extension, renewal or
such refinancing (1) does not increase the principal amount of such Material
Debt at the time of such extension, renewal or refinancing and (2) is on terms
substantially similar to, and no more restrictive than, the original terms of
such Material Debt; (iii) Debt outstanding under the Note Agreement and under
the Notes (as defined in the Note Agreement) and the Subsidiary Guarantees
required pursuant thereto; (iv) Debt owing from the Borrower to a Wholly-Owned
Subsidiary, from a Wholly-Owned Subsidiary to the Borrower, or from one
Wholly-Owned Subsidiary to another Wholly-Owned Subsidiary; (v) additional
secured Facility Debt incurred after the Closing Date, provided that at the time
such additional Facility Debt is incurred (1) no Default or Event of Default
shall have occurred or will occur as a result of the incurrence of such Facility
Debt, (2) the aggregate principal amount of such additional Facility Debt is not
greater than $10,000,000, and (3) all the holders of such additional Facility
Debt (and all of the holders of the Liens securing such additional Facility
Debt) shall have become parties to the Intercreditor Agreement; and (vi) in
addition to the Debt permitted by clauses (i) to and including (v) above, Debt
incurred after the Closing Date, provided that at the time such additional Debt
is incurred, (1) no Default or Event of Default shall have occurred or will
occur as a result of the incurrence of such additional Debt, (2) the Total
Consolidated Debt to Total Consolidated Capitalization Ratio both immediately
prior to the incurrence of such additional Debt and immediately after and giving
effect to the incurrence of such additional Debt shall be at least three
percentage points lower than the maximum Total Consolidated Debt to Total
Consolidated Capitalization Ratio required by Section 6.10 on the date of the
incurrence of such additional Debt (e.g., if the additional Debt were incurred
during the period from the Closing Date to and including December 31, 2002, the
Total Consolidated Debt to Total Consolidated Capitalization Ratio both
immediately prior to the incurrence of such Debt and immediately after and
giving effect to the incurrence of such Debt shall not exceed 52%), and (3) the
Total Consolidated Debt to Consolidated EBITDA Ratio both immediately prior to
the incurrence of such additional Debt and immediately after and giving effect
to the incurrence of such additional Debt shall be at least 0.5 lower than the
maximum Total Consolidated Debt to Consolidated EBITDA Ratio required by Section
6.11 on the date of the incurrence of such additional Debt (e.g., if the
additional Debt were incurred during the period from the Closing Date to and
including December 31, 2002, the Total Consolidated Debt to EBITDA Ratio both
immediately prior to the incurrence of such additional Debt and immediately
after and giving effect to the incurrence of such additional Debt shall not
exceed 3.0 to 1). Any Person which becomes a Subsidiary after the date hereof
shall for all purposes of this Section 6.08 be deemed to have created, assumed
or incurred at the time it becomes a Subsidiary all Debt of such Person existing
immediately after it becomes a Subsidiary.

     Section 6.09. Limitations on Capital Expenditures. Without the prior
written consent of the Bank, the Borrower and its Subsidiaries shall not make
capital expenditures of more than the following aggregate amounts in each of its
fiscal years, provided that the Borrower may expend an amount equal to the
unspent portion of monies from the immediately preceding fiscal year in the
immediately succeeding fiscal year: $8,000,000 for fiscal year 2002; $20,000,000
for fiscal year 2004; and $12,000,000 for each fiscal year thereafter.

     Section 6.10. Total Consolidated Debt to Total Consolidated Capitalization
Ratio. The Borrower will not, as of the end of any calendar month, permit the
ratio of Total Consolidated Debt to Total Consolidated Capitalization (the
"Total Consolidated Debt to Total Consolidated Capitalization Ratio"), as a
percentage, to exceed the following amounts for the following

                                      -32-

<PAGE>

periods: (i) 55% for the period commencing on the Closing Date to and including
December 31, 2002 and (ii) 50% thereafter.

     Section 6.11. Total Consolidated Debt to Consolidated EBITDA Ratio. The
Borrower will not, as of the end of any fiscal quarter, permit the ratio of the
Total Consolidated Debt to Consolidated EBITDA (the "Total Consolidated Debt to
Consolidated EBITDA Ratio") for the four-quarter period ended as of the end of
such fiscal quarter to exceed the following amounts for the following periods:
(i) 3.5 to 1 for the period commencing on the Closing Date to and including
December 31, 2002, (ii) 3.0 to 1 for the period January 1, 2003 to and including
December 31, 2003 and (ii) 2.75 to 1 thereafter.

     Section 6.12. Fixed Charge Coverage Ratio. The Borrower will not, as of the
end of any fiscal quarter, permit the Fixed Charge Coverage Ratio for the four
quarter period ended as of the end of such fiscal quarter to be less than the
following amounts for the following periods: (i) 1.25 to 1 for the period
commencing on the Closing Date to and including December 31, 2002 and (ii) 1.35
to 1 thereafter.

     Section 6.13. Minimum Tangible Net Worth. The Borrower will at all times
maintain Consolidated Tangible Net Worth at not less than the sum of (i)
$70,000,000, (ii) 100% of the Net Proceeds of all stock issued after the Closing
Date, plus (iii) fifty percent (50%) of Consolidated Net Income after June 30,
2002 (taken as one accounting period), but excluding from such calculation of
Consolidated Net Income for purposes of this clause (iii) any quarter in which
Consolidated Net Income is negative.

     Section 6.14. Consolidations, Mergers and Sales of Assets. (a) Neither the
Borrower nor any Subsidiary will, without the prior written consent of the Bank,
consolidate or merge with or into any other Person, provided that so long as no
Default or Event of Default shall have occurred or will occur after giving
effect thereto, (i) a Subsidiary may merge into the Borrower if the Borrower is
the surviving entity and (ii) the Borrower or any Subsidiary may merge into or
consolidate with another Person if the Borrower or such Subsidiary, as the case
may be, is the entity surviving such merger or consolidation.

             (b)   Neither the Borrower nor any Subsidiary will, without the
prior written consent of the Bank, convey, sell, lease, assign transfer of
otherwise dispose of any of its property, business or assets (including, without
limitation, the sale of any receivables and leasehold interests and any sale
leaseback or similar transaction), whether now owned or hereafter acquired,
except:

                   (i)   the sale of Inventory in the ordinary course of
business;

                   (ii)  provided that no Default or Event of Default has
occurred or would occur as a result of the consummation of such sale or other
disposition, the sale or other disposal of assets (but specifically excluding
the real property and the improvements thereon encumbered by the Deed of Trust
or the Nevada Deed of Trust) for fair market value which the Borrower determines
are no longer needed for the operation of the business of the Borrower and its
Subsidiaries; provided that the aggregate net book value of assets so disposed
of shall not exceed $2,500,000 in any fiscal year; provided further that if the
Borrower or the applicable Subsidiary

                                      -33-

<PAGE>

(A) acquires fixed assets useful and intended to be used in the operation of the
business of the Borrower and its Subsidiaries, such fixed assets are subject to
the first lien and security interest of the Collateral Agent, such fixed assets
have an actual out-of-pocket cost equal to or greater than the proceeds
resulting from such sale or other disposition, and such fixed assets are
acquired within 210 days of such sale or other disposition or (B) applies the
net proceeds of any such sales which exceed $2,500,000 in any fiscal year (such
excess net proceeds, "Fixed Asset Proceeds") to prepay the Revolving Credit Loan
Obligations (or, if required by the terms of the Note Agreement, to repay the
Secured Obligations (as defined in the Intercreditor Agreement) on a pro rata
basis), such sale or other disposition shall be excluded from the calculation of
the amount in this clause (ii);

                   (iii) provided that no Default or Event of Default has
occurred or would occur as a result of such sale or other disposition, the sale,
lease, transfer or other disposition of any assets of any Subsidiary to the
Borrower or a Wholly-Owned Subsidiary;

                   (iv)  provided that no Default or Event of Default has
occurred and notwithstanding any other provision of this Agreement or in any of
the other Loan Documents, upon thirty (30) days prior written notice to the
Bank: (a) TREX Company, LLC may merge into or consolidate with Trex Company,
Inc. and (b) (1) TREX Company, LLC or Trex Company, Inc. may create a
Wholly-Owned Subsidiary (the "IP Subsidiary") and transfer thereto all patents,
trademarks, copyrights and other intellectual property of the Borrower (the
"IP"); provided, however, that the IP Subsidiary shall execute and deliver to
the Bank, or cause to be executed and delivered to the Bank, all of the
documentation required by Section 6.23, if any, and (2) the IP Subsidiary may
license the IP to the Borrower, subject to Section 6.24 hereof; and

                   (v)   the Borrower may terminate the corporate or other
existence of DENPLAX, S.A. and surrender its equity interest in DENPLAX, S.A.
for no consideration, provided that no Default or Event of Default has occurred
or would occur as a result of such termination of existence and surrender of
equity interest, and further provided that such termination of existence and
surrender of equity interest is deemed prudent in the reasonable business
judgment of the Borrower.

     Section 6.15. Investments; Acquisitions.

     (a)   Investments. Neither the Borrower nor any Subsidiary will hold, make
or acquire any Investment in any Person, except:

           (i)     the Borrower and any Subsidiary may invest in cash and Cash
Equivalents;

           (ii)    the Borrower and any Subsidiary may acquire and hold
receivables owing to them, if created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary trade terms;

           (iii)   the Borrower and any Subsidiary may acquire and own
investments (including Debt obligations) received in connection with the
bankruptcy or reorganization of

                                      -34-

<PAGE>

suppliers and customers and in settlement of delinquent obligations of, and
other disputes with customers and supplies arising in the ordinary course of
business;

          (iv)   the Borrower and any Subsidiary may make loans and advances to
any employees, officers, directors, managers, shareholders, or members of their
immediate families, and to current and/or prospective customers and/or vendors
in the ordinary course of business (excluding receivables arising in the
ordinary course of business), provided such loans and advances do not exceed at
any time, in the aggregate, $500,000;

          (v)    any Acquisition permitted by Section 6.15(b);

          (vi)   Trex Company, Inc. may invest up to $300,000 in addition to its
existing investment in Winchester Capital, Inc.;

          (vii)  Trex Company, Inc. or TREX Company, LLC may invest up to
$500,000 in the aggregate, in addition to the value of the IP to be contributed
thereto, in the IP Subsidiary;

          (viii) Trex Company, Inc. and TREX Company, LLC and/or any Subsidiary
may invest in Trex Wood Polymer Espana, S.L., in DENPLAX, S.A. and/or in
additional to-be-formed Foreign Subsidiaries and Foreign Joint Ventures,
provided that the total investment in all such Foreign Subsidiaries and Foreign
Joint Ventures, exclusive of the investment as of the Closing Date of Trex
Company, Inc. and TREX Company, LLC in Trex Wood Polymer Espana, S.L. and the
investment as of the Closing Date of Trex Wood Polymer Espana, S.L. in DENPLAX,
S.A., shall not at any time exceed $3,000,000;

          (ix)   any Subsidiary may invest in the Borrower;

          (x)    Trex Company, Inc. may invest in TREX Company, LLC (and vice
versa); and

          (xi)   Trex Company, Inc. and TREX Company, LLC may hold other
Investments not set forth in sub-clauses (i) to and including (x) above in an
aggregate amount not to exceed $15,000,000 at any time; provided, however, that
(A) with respect to the Investments described in sub-clauses (iv), (vi), (vii)
and (viii) above, the limits set forth therein may not be exceeded, and (B) any
amount invested pursuant to sub-clause (viii) above shall reduce
dollar-for-dollar the amount available for other Investments under this
sub-clause (xi).

     (b) Acquisitions. The Borrower will not, and will not permit any of its
Subsidiaries to, enter into any Acquisition transaction, except that the
Borrower and any Subsidiary may (i) acquire all or a material portion of the
assets of a Person and (ii) own, purchase or acquire stock, obligations or
securities of a Person which following such purchase or acquisition is a
Wholly-Owed Subsidiary if (A) the Person being acquired (or whose assets are
being acquired) is in the same general type of business as the Borrower (or
complementary thereto); (B) the aggregate cash consideration (exclusive of all
Debt of such Person being acquired that is not discharged by the seller at the
time of such Acquisition, all Debt as to which the Borrower takes subject, and
all other liabilities (including contingent earn-out payments) paid or to be
paid by the Borrower or

                                      -35-

<PAGE>

the Person being acquired in connection with such Acquisition) paid (1) in
connection with any Acquisition (or series of related Acquisitions) shall not
exceed $10,000,000 during any fiscal year of the Borrower and (2) in connection
with all Acquisitions shall not exceed $15,000,000 for the period from the
Closing Date to the Revolving Credit Termination Date, (C) the aggregate
consideration (including all Debt of such Person being Acquired that is not
discharged by the seller at the time of such Acquisition, all Debt as to which
the Borrower takes subject, and all other liabilities (including contingent
earn-out payments) paid or to be paid by the Borrower or the Person being
acquired in connection with such Acquisition) paid (1) in connection with all
Acquisitions shall not exceed $20,000,000 during any fiscal year of the Borrower
and (2) in connection with all Acquisitions shall not exceed $30,000,000 for the
period from the Closing Date to the Revolving Credit Termination Date; (D) (1)
the Total Consolidated Debt to Total Consolidated Capitalization Ratio both
immediately prior to such proposed Acquisition and immediately after and giving
effect to such proposed Acquisition shall be at least three percentage points
lower than the maximum Total Consolidated Debt to Total Consolidated
Capitalization Ratio required by Section 6.10 on the date of such proposed
Acquisition (e.g., if the proposed Acquisition occurs during the period from the
Closing Date to and including December 31, 2002, the Total Consolidated Debt to
Total Consolidated Capitalization Ratio both immediately prior to such proposed
Acquisition and immediately after and giving effect to such proposed Acquisition
shall not exceed 52%) and (2) the Pro Forma Total Consolidated Debt to
Consolidated EBITDA Ratio shall be at least 0.5 lower than the maximum ratio of
the Total Consolidated Debt to Consolidated EBITDA required by Section 6.11 on
the date of the proposed Acquisition (e.g., if the proposed Acquisition occurs
during the period from the Closing Date to and including December 31, 2002, the
Pro Forma Total Consolidated Debt to Consolidated EBITDA Ratio shall not exceed
3.0 to 1); (E) no Default or Event of Default has occurred or will occur as a
result of the Acquisition of such Person; and (F) the Borrower shall have
provided the Bank not less than ten (10) Business Days before the consummation
of such Acquisition a certificate in form and substance satisfactory to the Bank
that certifies as to each of the items in clauses (A), (B), (C), (D) and (E) of
this Section 6.15(b) and includes both pro forma financial statements that
demonstrate compliance with clause (D) of this Section 6.15(b) and consolidated
financial statements for the Borrower and its Subsidiaries that demonstrate
compliance with each of the covenants contained in Sections 6.09 to and
including 6.13 immediately prior to and after giving effect to such Acquisition,
and the Bank shall have accepted as correct prior to the consummation of such
Acquisition such certificate and the calculations and assumptions contained
therein and in the financial statements included therewith.

     Section 6.16. Payments, Etc. Except as permitted below, the Borrower will
not, and will not permit any of its Subsidiaries to, make any distribution,
dividend, payment or delivery of property or cash on or with respect to its
Capital Stock or its membership interests, or redeem, retire, purchase or
otherwise acquire, directly or indirectly, for any consideration, any membership
or other interests or shares of any class of its Capital Stock now or hereafter
outstanding (or any warrants exercisable for, or options or stock appreciation
rights in respect of, any of such shares of Capital Stock or membership
interests), or set aside any funds for any of the foregoing purposes, or permit
any of its Subsidiaries to purchase or otherwise acquire for consideration any
shares of Capital Stock or any membership interest in the Borrower or any shares
of Capital Stock or other equity interest in any other Subsidiary, as the case
may be, now

                                      -36-

<PAGE>

or hereafter outstanding (or any options or warrants exercisable for or stock
appreciation rights issued by the Borrower or any Subsidiary with respect to its
Capital Stock or membership interests).

     The foregoing provisions of this Section 6.16 shall not limit or prohibit
any of the following transactions:

     (a)  the making of any distribution, dividend, payment or delivery of
property or cash on or with respect to its Capital Stock or its membership
interests by (i) any Subsidiary to Trex Company, Inc or TREX Company, LLC or to
any Material Subsidiary or (ii) any Subsidiary that is not a Material Subsidiary
to another Subsidiary that is not a Material Subsidiary;

     (b)  the payment by Trex Company, Inc. of a dividend on its common stock
solely in shares of its common stock in connection with a split of such common
stock and of cash in lieu of fractional shares in connection with any such split
of common stock;

     (c)  any transaction contemplated by the Warrant, including the retirement
and cancellation of the Warrant and the issuance of new warrants in exchange,
replacement or substitution therefor and payment of cash in lieu of fractional
shares of common stock of Trex Company, Inc. upon any exercise of the Warrant;

     (d)  any transaction which is expressly permitted by Section 6.14 or
Section 6.15;

     (e)  any dividend payable solely in Capital Stock of Trex Company, Inc.
(other than Disqualified Stock) or any dividend of rights or other distribution
of rights under a Shareholder Rights Plan, any issuance of Capital Stock of Trex
Company, Inc. (other than Disqualified Stock) upon the exercise of such rights,
and any redemption, retirement or other acquisition by Trex Company, Inc. of any
such rights for consideration that does not exceed $250,000 in the aggregate;

     (f)  the redemption, retirement, purchase or other acquisition for
consideration of any class of Capital Stock of Trex Company, Inc. (or options,
warrants or other rights to acquire Capital Stock of Trex Company, Inc.) in
exchange for, or out of the proceeds of a substantially concurrent offering of,
shares of any class of Capital Stock (other than Disqualified Stock) of Trex
Company, Inc. (or options, warrants or other rights to acquire such Capital
Stock);

     (g)  the payment of cash in lieu of fractional shares of Capital Stock of
Trex Company, Inc. in connection with a transaction of merger or consolidation,
Acquisition or transfer of assets that complies with Section 6.14 or Section
6.15(b); provided, however, that the aggregate amount of all such cash payments
in any such transaction shall not exceed $100,000; or

     (h)  dividends on or with respect to Capital Stock of Trex Company, Inc. or
redemptions or purchases of Capital Stock of Trex Company, Inc. not otherwise
permitted under clauses (a) to and including (g) of this Section 6.16 that do
not exceed in the aggregate in any fiscal year of the Borrower, 50% of the
Consolidated Net Income for the immediately preceding

                                      -37-

<PAGE>

fiscal year, provided that no Default or Event of Default has occurred or will
occur immediately after and giving effect to such dividends, redemptions or
purchases.

     Section 6.17. Use of Proceeds. The proceeds of the Revolving Loans made
under this Agreement will be used by the Borrower for working capital financing
of the Borrower's accounts receivable and inventory, to purchase equipment
and/or for other general corporate purposes of the Borrower. The proceeds of the
Real Estate Term Loans 1, 2 & 3 made under this Agreement will be used by the
Borrower to refinance the Winchester Property, and the proceeds of the Real
Estate Term Loan 4 made under this Agreement will be used by the Borrower to
finance existing improvements to the Winchester Property. None of the proceeds
of the Revolving Loans or Real Estate Term Loans 1, 2, 3 or 4 will be, directly
or indirectly, for the purpose, whether immediate, incidental or ultimate, of
buying or carrying any "margin stock" within the meaning of Regulation U.

     Section 6.18. Transactions With Other Persons. The Borrower will not, and
will not permit any of its Subsidiaries to, enter into any agreement with any
Person whereby any of them shall agree to any restriction on the right of the
Borrower or any of its Subsidiaries to amend or waive any of the provisions of
this Agreement or any other Loan Document.

     Section 6.19. Location of Finished Goods Inventory. The Borrower will store
all finished goods Inventory at a location owned by the Borrower or its
Subsidiaries; provided, however, the Borrower may store any finished goods
Inventory at a location not owned by the Borrower or its Subsidiaries if the
Borrower has obtained a waiver from each landlord of such location, in form and
substance satisfactory to the Bank in its sole but reasonable discretion, by
which such landlord waive their respective rights, if any, in the finished goods
Inventory stored at such location.

     Section 6.20. Deposit Accounts. To facilitate the administration of the
Revolving Loans, the Borrower and its Subsidiaries shall maintain all of their
operating deposit accounts with the Bank and if requested by the Bank will
establish and maintain a lock box cash management system in an assignee account
at the Bank. Notwithstanding the foregoing, the Borrower or its Subsidiaries may
maintain one general operating depository account in each of Fernley, Nevada,
Almeria, Spain and up to three (3) other separate locations; provided that, if
at any time the balance in any such operating depository account exceeds
$150,000 at the close of any Business Day, the Collateral Agent shall be
entitled to a first priority security interest therein and the Borrower or such
Subsidiary shall take such actions (including without limitation obtaining a
control agreement from the applicable depository institution) as are necessary
to perfect such security interest.

     Section 6.21. Compliance With Agreements. The Borrower will comply in all
respects with, and will cause each of its Subsidiaries to comply in all respects
with, each term, condition and provision of all instruments and agreements
entered into in the conduct of its business, including without limitation any
Material Contract, except in the case where the failure to so qualify would not,
in any given instance or in the aggregate, have a Material Adverse Effect.

     Section 6.22. More Favorable Covenants. If, after the date hereof, any of
the covenants, representations and warranties or events of default, or any other
material term or provision,

                                      -38-

<PAGE>

contained in the Note Agreement is amended, restated, supplemented or otherwise
modified to make such covenant, representation and warranty or event of default,
or any other material term or provision more favorable, in the sole but
reasonable opinion of the Bank, to the lender or lenders under the Note
Agreement than are the terms of this Agreement to the Bank, this Agreement shall
be amended to contain each such more favorable covenant, representation and
warranty, event of default, term or provision, and the Borrower hereby agrees to
so amend this Agreement and to execute and deliver all such documents requested
by the Bank to reflect such amendment. If, after the date hereof, any of the
covenants, representations and warranties or events of default, or any other
material term or provision, of the documents executed in connection with the
Facility Debt permitted under Section 6.08(v) is, or is amended, restated,
supplemented or otherwise modified to be, more favorable, in the sole but
reasonable opinion of the Bank, to the lender or lenders under such Facility
Debt documents than are the terms of this Agreement to the Bank, this Agreement
shall be amended to contain each such more favorable covenant, representation
and warranty, event of default, term or provision, and the Borrower hereby
agrees to so amend this Agreement and to execute and deliver all such documents
requested by the Bank to reflect such amendment. Prior to the execution and
delivery of such documents by the Borrower, unless the Bank has waived in
writing its rights under this Section 6.22, this Agreement shall be deemed to
contain each such more favorable covenant, representation and warranty, event of
default, term or provision of the Note Agreement or the documents executed in
connection with the Facility Debt, as the case may be, for purposes of
determining the rights and obligations hereunder.

     Section 6.23. Additional Pledge Agreement, Security Agreement, and Guaranty
Agreement Documentation. (a) If, at any time after the date hereof, (1) any of
the Borrower's Subsidiaries, other than TREX Company, LLC, becomes a Material
Subsidiary or (2) the Borrower forms or acquires any Material Subsidiary, then
the Borrower shall provide to the Bank the following documentation:

          (i)   a subsidiary pledge agreement that secures the Revolving Credit
Loan Obligations, in form and substance acceptable to the Bank, and duly
executed and delivered by the owner or owners of such Subsidiary (the
"Additional Subsidiary Pledgor");

          (ii)  stock certificates or equivalent certificates evidencing the
equity interests representing 100% of the issued and outstanding capital stock
or equivalent equity interests of such Subsidiary which is owned by the Borrower
or its Subsidiary, together with blank stock powers or equivalent powers
therefor;

          (iii) a subsidiary security agreement that secures the Revolving
Credit Loan Obligations, substantially in the form of the Security Agreement,
and duly executed and delivered by such Subsidiary;

          (iv)  a subsidiary guaranty that guarantees the Revolving Credit Loan
Obligations, in form and substance acceptable to the Bank, and duly executed and
delivered by such Subsidiary;

          (v)   a certificate from the chief executive officer, chief financial
officer or treasurer of such Subsidiary, in form and substance reasonably
satisfactory to the Bank, to the effect

                                      -39-

<PAGE>

that all representations and warranties of such Subsidiary contained in the
subsidiary security agreement and the subsidiary guaranty are true, correct and
complete in all material respects; that such Subsidiary is not in violation of
any of the covenants contained in the subsidiary security agreement or the
subsidiary guaranty; that no Default or Event of Default has occurred and is
continuing or, after giving effect to its execution and delivery of the
subsidiary security agreement and the subsidiary guaranty, will occur;

          (vi)   a certificate from the chief executive officer, chief financial
officer or treasurer of such Additional Subsidiary Pledgor, in form and
substance reasonably satisfactory to the Bank, to the effect that all
representations and warranties of such Additional Subsidiary Pledgor contained
in the subsidiary pledge agreement are true, correct and complete in all
material respects; that such Additional Subsidiary Pledgor is not in violation
of any of the covenants contained in the subsidiary pledge agreement; that no
Default or Event of Default has occurred and is continuing or, after giving
effect to its execution and delivery of the subsidiary pledge agreement, will
occur;

          (vii)  a certificate of the secretary or other appropriate officer or
authorized person of such Subsidiary certifying as to the incumbency and
genuineness of the signature of each officer or authorized signer of such
Subsidiary executing the subsidiary security agreement and the subsidiary
guaranty and certifying that attached thereto is (A) a true and complete copy of
the articles of incorporation, articles of organization, partnership agreement
or equivalent organizational document of such Subsidiary, and all amendments
thereto, certified as of a recent date by the appropriate governmental official
of its jurisdiction of formation; (B) a true and complete copy of the bylaws,
operating agreement, or equivalent agreement of such Subsidiary as in effect on
the date of such certification; (C) a true and complete copy of resolutions duly
adopted by the board of directors, members, managers or equivalent governing
body of such Subsidiary authorizing the execution, delivery and performance of
the subsidiary security agreement and the subsidiary guaranty; and (D) a true
and complete copy of each certificate required to be delivered pursuant to
Section 6.23(ix);

          (viii) a certificate of the secretary or other appropriate officer or
authorized person of such Additional Subsidiary Pledgor certifying as to the
incumbency and genuineness of the signature of each officer or authorized signer
of such Additional Subsidiary Pledgor executing the subsidiary pledge agreement
and certifying that attached thereto is (A) a true and complete copy of the
articles of incorporation, articles of organization, partnership agreement or
equivalent organizational document of such Additional Subsidiary Pledgor, and
all amendments thereto, certified as of a recent date by the appropriate
governmental official of its jurisdiction of formation; (B) a true and complete
copy of the bylaws, operating agreement, or equivalent agreement of such
Additional Subsidiary Pledgor as in effect on the date of such certification;
(C) a true and complete copy of resolutions duly adopted by the board of
directors, members, managers or equivalent governing body of such Additional
Subsidiary Pledgor authorizing the execution, delivery and performance of the
subsidiary pledge agreement; and (D) a true and complete copy of each
certificate required to be delivered pursuant to Section 6.23(x);

          (ix)   a certificate of good standing of such Subsidiary as of a
recent date from the appropriate governmental official of its jurisdiction of
formation and in each other jurisdiction where such Subsidiary is qualified to
do business;

                                      -40-

<PAGE>

          (x)    a certificate of good standing of such Additional Subsidiary
Pledgor as of a recent date from the appropriate governmental official of its
jurisdiction of formation and in each other jurisdiction where such Additional
Subsidiary Pledgor is qualified to do business;

          (xi)   UCC financing statements for such Subsidiary, and otherwise in
form and substance acceptable to the Bank, together with evidence satisfactory
to the Bank that they have been filed in the appropriate filing offices to
perfect the security interests granted to the Bank in such subsidiary security
agreement;

          (xii)  UCC search reports acceptable to the Bank, covering such
Subsidiary for each filing office in which a financing statement in favor of the
Bank has been or is being filed to perfect the security interests granted to the
Bank in such subsidiary security agreement and for each filing office otherwise
specified by the Bank, which show only Liens which have been terminated, Liens
permitted under Section 6.07 and Liens which are otherwise acceptable to the
Bank;

          (xiii) a favorable opinion of counsel to such Subsidiary addressed to
the Bank in form and substance satisfactory to the Bank with respect to such
Subsidiary and the subsidiary security agreement and the subsidiary guaranty,
and such other matters as the Bank shall request;

          (xiv)  a favorable opinion of counsel to such Additional Subsidiary
Pledgor addressed to the Bank in form and substance satisfactory to the Bank
with respect to such Additional Subsidiary Pledgor and the subsidiary pledge
agreement, and such other matters as the Bank shall request; and

          (xv)   such other documents, instruments, certificates, opinions and
other information as the Bank shall reasonably request.

          (b)    In addition to the other limitations contained in this
Agreement, the Borrower will not permit any Material Subsidiary which has not
signed a subsidiary guaranty at that time to be or become liable in respect of
any other Guarantee after the date hereof; provided, however, that such Material
Subsidiary may execute and deliver such Guarantee so long as the Borrower shall
contemporaneously therewith cause such Material Subsidiary and the Additional
Subsidiary Pledgor to execute and deliver, and such Material Subsidiary shall
execute and deliver and the Additional Subsidiary Pledgor shall execute and
deliver, as applicable, to the Bank, a subsidiary guarantee, a subsidiary
security agreement and a subsidiary pledge agreement together with all other
documents, agreement, certificates and opinions in compliance with the terms and
provisions of this Section 6.23. It being the intent of this Section 6.23(b)
that at all times the Borrower shall cause all Subsidiaries which have executed
and delivered Guarantees to holders of Debt of the Borrower and/or any other
Material Subsidiary to have executed and delivered all of the documentation in
accordance with and pursuant to the provisions of this Section 6.23.

          (c)    The Borrower shall pay on demand all reasonable out-of-pocket
fees and expenses of the Bank, including without limitation the reasonable fees
and expenses of counsel to the Bank, incurred in connection with the execution
and delivery of the subsidiary pledge

                                      -41-

<PAGE>

agreements, the subsidiary security agreements, the subsidiary guaranties and
the related documents, agreements, certificates and opinions described in this
Section 6.23.

     Section 6.24.  Transactions with Affiliates. The Borrower will not and will
not permit any Subsidiary to enter into directly or indirectly any transaction
or material group of related transactions (including without limitation the
purchase, lease, sale or exchange of properties of any kind or the rendering of
any service) with any Affiliate (other than the Borrower or another Subsidiary),
except in the ordinary course of the Borrower's or such Subsidiary's business
and upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary than would be obtainable in a comparable arm's-length transaction
with a Person not an Affiliate.

     Section 6.25.  Further Assurances. The Borrower shall make, execute and
deliver, and cause each of its Subsidiaries to make, execute and deliver, all
such additional and further acts, things, deeds and instruments as the Bank may
reasonably require to document and consummate the transactions contemplated
hereby and to vest completely in and ensure the Bank its rights under this
Agreement and the other Loan Documents.

     Section 6.26.  Independence of Covenants. All covenants contained herein
shall be given independent effect so that if a particular action or condition is
not permitted by any of such covenants, the fact that such action or condition
would be permitted by an exception to, or otherwise be within the limitations
of, another covenant shall not avoid the occurrence of a Default if such action
is taken or condition exists.

                                   ARTICLE VII
                                    DEFAULTS

     Section 7.01.  Events of Default. If one or more of the following events
("Events of Default") shall have occurred and be continuing:

     (a)  the Borrower shall fail to pay, within five (5) days after the date
when due, any principal, interest, fee (including the Unused Commitment Fee) or
any other amount payable hereunder or under the Notes;

     (b)  the Borrower shall fail to observe or perform any covenant or
agreement contained in this Agreement, except those covenants or agreements
which address the events covered by clause (a) above, or which are contained in
Sections 6.01(a) to and including 6.01(e), or in Section 6.06, 6.07, 6.19, 6.20,
6.25 or 6.26;

     (c)  the Borrower shall fail to observe or perform any covenant or
agreement contained in Sections 6.01(a) to and including 6.01(e), or in Section
6.06, 6.07, 6.19, 6.20, 6.25 or 6.26, and such failure shall continue unremedied
for a period of fifteen (15) days;

     (d)  any representation, warranty, certification or statement made by the
Borrower in this Agreement or in any certificate, financial statement or other
document delivered pursuant hereto or thereto shall prove to have been incorrect
in any material respect when made or deemed to be made;

                                      -42-

<PAGE>

     (e)  the Borrower or any Subsidiary shall fail to make any payment or
perform any collateralization obligation in respect of any Material Financial
Obligations when due which remains uncured or unwaived following the expiration
of any applicable cure period;

     (f)  any event or condition shall occur which results in the acceleration
of the maturity of any Material Debt of the Borrower or any Subsidiary or
enables the holder of such Material Debt or any Person acting on such holder's
behalf to accelerate the maturity thereof;

     (g)  the Borrower or any Subsidiary shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;

     (h)  an involuntary case or other proceeding shall be commenced against the
Borrower or any Subsidiary seeking liquidation, reorganization or other relief
with respect to it or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Borrower or any Subsidiary under the federal
bankruptcy laws as now or hereafter in effect;

     (i)  any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $250,000 which it shall have become liable to
pay under Title IV of ERISA or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or default, within the meaning of Section
4219(c)(5) of ERISA, with respect to one or more Multiemployer Plans which could
reasonably be expected to cause one or more members of the ERISA Group to incur
a current payment obligation in excess of $250,000;

     (j)  one or more final judgments or orders for the payment of money in
excess of $250,000 in the aggregate which are not adequately insured against
shall be rendered against the Borrower or any Subsidiary of the Borrower and
such judgments or orders shall continue unbonded, unsatisfied and unstayed for a
period of 30 days;

     (k)  a Change of Control shall have occurred;

                                      -43-

<PAGE>

     (l)  the occurrence of any default or event of default under the Note
Agreement or under any of the documents executed in connection with the Facility
Debt, in each case which remains uncured or unwaived following the expiration of
any applicable cure period;

     (m)  the occurrence of any default or event of default under any Loan
Document (other than this Agreement) which remains uncured or unwaived following
the expiration of any applicable cure period; or

     (n)  Any material provision of this Agreement or any other Loan Document
shall for any reason cease to be valid and binding on the Borrower or any
Subsidiary party thereto or any such Person shall so state in writing, in each
case other than in accordance with the express terms hereof or thereof;

then, and in every such event, while such event is continuing, the Bank may (i)
by notice to the Borrower terminate the Revolving Commitment and it shall
thereupon terminate, and (ii) by notice to the Borrower declare the Revolving
Credit Loan Obligations and the Real Estate Term Loan Obligations (together with
accrued interest thereon) to be, and the Revolving Credit Loan Obligations and
the Real Estate Term Loan Obligations shall thereupon become, immediately due
and payable without presentment, demand, protest or other notice of any kind
(except as set forth in clause (i) above), all of which are hereby waived by the
Borrower, provided that in the case of any Default or any Event of Default
specified in Section 7.01(g) or (h) above with respect to the Borrower, without
any notice to the Borrower or any other act by the Bank, the commitment to make
Revolving Loans and Real Estate Term Loans 1, 2, 3 & 4 shall thereupon
automatically and immediately terminate and the Revolving Credit Loan
Obligations and the Real Estate Term Loan Obligations (together with accrued
interest and accrued and unpaid fees thereon) shall become immediately due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, upon the occurrence of any Event of Default, the
Bank is authorized at any time and from time to time, without presentment,
demand, protest or other notice of any kind (all of which rights being hereby
expressly waived), to set off and to appropriate and apply any and all deposits
and any other indebtedness at any time held or owing by the Bank to or for the
credit or the account of the Borrower against obligations and liabilities of the
Borrower to the Bank hereunder, under the Notes, or the other Loan Documents.

                                  ARTICLE VIII
                             CHANGE IN CIRCUMSTANCES

     Section 8.01.  Illegality. If, on or after the date of this Agreement, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Bank with any request or directive (whether or not having the force of
law) of any such authority, central bank or comparable agency, shall make it
unlawful or impossible for the Bank to make, maintain or fund Loans and the Bank
shall so notify the Borrower, until the Bank notifies the Borrower that the
circumstances giving rise to such suspension no longer exist,

                                      -44-

<PAGE>

each Loan then outstanding which bears interest at LIBOR shall be
converted immediately to a Base Rate Loan and all new Loans shall be Base Rate
Loans.

Section 8.02. Base Rate Loans Substituted for Affected LIBOR Loans. Upon the
occurrence of any event or condition set forth in Section 8.01, each Loan then
outstanding which bears interest at LIBOR shall be converted immediately to a
Base Rate Loan and all new Loans shall be Base Rate Loans. If the Bank notifies
the Borrower that the circumstances giving rise to such change in interest rate
no longer apply, the principal amount of each such Base Rate Loan shall cease
immediately to constitute a Base Rate Loan and shall thereafter bear interest in
accordance with Section 2.05.

                                   ARTICLE IX
                                  MISCELLANEOUS

     Section 9.01.  Notices. Unless otherwise specified herein, all notices,
requests and other communications to a party hereunder shall be in writing
(including facsimile transmission) and shall be given to such party: (a) at its
address or facsimile number set forth on the signature pages hereof, or (b) at
such other address or facsimile number as such party may hereafter specify for
the purpose of communication hereunder by notice to the other party hereto. Each
such notice, request or other communication shall be effective (i) if given by
facsimile transmission, when transmitted to the facsimile number specified in
this Section and confirmation of receipt is received, (ii) if given by mail, 72
hours after such communication is deposited in the mails, certified mail, return
receipt requested, with appropriate first-class postage prepaid, addressed as
specified in this Section, or (iii) if given by any other means, when delivered
at the address specified in this Section 9.01. Rejection or refusal to accept or
the inability to deliver because of a changed address of which no notice was
given shall not affect the validity of notice given in accordance with this
Section.

     Section 9.02.  Expenses; Indemnity. The Borrower will (a) pay all
out-of-pocket expenses of the Bank in connection with (i) the preparation,
execution and delivery of this Agreement and each other Loan Document, whenever
the same shall be executed and delivered, including without limitation all
out-of-pocket administrative and due diligence expenses and reasonable fees and
disbursements of counsel for the Bank and (ii) the preparation, execution and
delivery of any waiver, amendment or consent by the Bank relating to this
Agreement or any other Loan Document, including without limitation reasonable
fees and disbursements of counsel for the Bank, (b) pay all reasonable
out-of-pocket expenses of the Bank incurred in connection with the
administration and enforcement of any rights and remedies of the Bank under this
Agreement or any of the other Loan Documents and the collection, bankruptcy,
insolvency and other enforcement proceedings resulting therefrom, including
consulting with appraisers, accountants, engineers, attorneys and other Persons
concerning the nature, scope or value of any right or remedy of the Bank
hereunder or under any other Loan Document or any factual matters in connection
therewith, which expenses shall include without limitation the reasonable fees
and disbursements of such Persons, and (c) defend, indemnify and hold harmless
the Bank, and its parent, subsidiaries, affiliates, employees, agents, officers,
directors, agents and attorneys from and against any losses, penalties, fines,
liabilities, settlements, damages, costs and expenses, suffered by any such
Person in connection with any claim, investigation, litigation or other
proceeding (whether or not the Bank is a party thereto) and the prosecution and
defense thereof,

                                      -45-

<PAGE>

arising out of or in any way connected with this Agreement, any other Loan
Document or the Loans, including without limitation reasonable attorney's and
consultant's fees, except to the extent that any of the foregoing directly
result solely from the gross negligence or willful misconduct of the party
seeking indemnification therefor.

     Section 9.03.  No Waivers. No failure by either party to exercise, no
course of dealing with respect to, and no delay in exercising any right, power
or privilege hereunder or under the Notes shall operate as a waiver thereof, nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies provided herein shall be cumulative and not exclusive of any
rights or remedies provided by law.

     Section 9.04.  Amendments and Waivers. Any provision of this Agreement or
the Notes may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed by the Borrower and the Bank.

     Section 9.05.  Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, except that the Borrower may not assign or
otherwise transfer any of its rights or delegate any of its duties under this
Agreement without the prior written consent of the Bank, except as may be
permitted pursuant to Section 6.14 hereof. The Bank shall have the right to
assign or otherwise transfer any of its rights or interests in this Agreement or
the other Loan Documents, in whole or in part, at any time; provided that if no
Default or Event of Default shall have occurred, the Bank shall not assign or
otherwise transfer any rights or interests without the consent of the Borrower,
such consent not to be unreasonably withheld, conditioned or delayed.
Notwithstanding the immediately preceding sentence, the Bank shall have the
right, without the consent of the Borrower, to (i) assign or otherwise transfer
any of its rights or interests in this Agreement or any of the Loan Documents,
in whole or in part, to any affiliate of the Bank, (ii) to grant one or more
participations or similar interests in this Agreement or any of the Loan
Documents to any Person and/or (iii) to pledge or assign any of its rights or
interests in this Agreement or any of the Loan Documents, in whole or in part,
to any Federal Reserve Bank.

     Section 9.06.  Governing Law. This Agreement and the Notes shall be
governed by and construed in accordance with the internal laws of the
Commonwealth of Virginia.

     Section 9.07.  Arbitration; Submission to Jurisdiction.

     (a)  Upon demand of any party hereto, whether made before or after
institution of any judicial proceeding, any claim or controversy arising out of
or relating to the Loan Documents between the parties hereto (a "Dispute") shall
be resolved by binding arbitration conducted under and governed by the
Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules") of the
American Arbitration Association (the "AAA") and the Federal Arbitration Act.
Disputes may include, without limitation, tort claims, counterclaims, disputes
as to whether a matter is subject to arbitration, claims brought as class
actions, or claims arising from documents executed in the future. A judgment
upon the award may be entered in any court having jurisdiction. Notwithstanding
the foregoing, this arbitration provision does not apply to disputes under or
related to swap agreements.

                                      -46-

<PAGE>

     (b)  All arbitration hearings shall be conducted in the City of Richmond,
Virginia. A hearing shall begin within 90 days of demand for arbitration and all
hearings shall be concluded within 120 days of demand for arbitration. These
time limitations may not be extended unless a party shows cause for extension
and then for no more than a total of 60 days. The expedited procedures set forth
in Rule 51 et seq. of the Arbitration Rules shall be applicable to claims of
less than $1,000,000. Arbitrators shall be licensed attorneys selected from the
Commercial Financial Dispute Arbitration Panel of the AAA. The parties do not
waive applicable federal or state substantive law except as provided herein.

     (c)  Notwithstanding the preceding binding arbitration provisions, the
parties agree to preserve, without diminution, certain remedies that any party
may exercise before or after an arbitration proceeding is brought. The parties
shall have the right to proceed in any court of proper jurisdiction or by
self-help to exercise or prosecute the following remedies, as applicable: (i)
all rights to foreclose against any real or personal property or other security
by exercising a power of sale or under applicable law by judicial foreclosure,
including a proceeding to confirm the sale; (ii) all rights of self-help,
including peaceful occupation of real property and collection of rents, setoff
and peaceful possession of personal property; and (iii) obtaining provisional or
ancillary remedies, including injunctive relief, sequestration, garnishment,
attachment, appointment of receiver and filing an involuntary bankruptcy
proceeding. Any claim or controversy with regard to the parties' entitlement to
such remedies is a Dispute.

     (d)  Each party agrees that it shall not have a remedy of punitive or
exemplary damages against the other in any Dispute and hereby waives any right
or claim to punitive or exemplary damages it may have now or which may arise in
the future in connection with any Dispute, whether the Dispute is resolved by
arbitration or judicially.

     (e)  TO THE FULLEST EXTENT PERMITTED BY LAW, THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY
DISPUTE.

     Section 9.08.  Obligations Joint and Several. Each and every obligation of
the Borrower contained in this Agreement or in any other Loan Document executed
by the Borrower shall be the joint and several obligations of each of TREX
Company, LLC and Trex Company, Inc.

     Section 9.09.  Counterparts; Integration; Effectiveness. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. Each of this Agreement, the Notes and the other Loan Documents shall
be deemed to incorporate the other of said documents by reference and all of
said documents shall constitute the entire agreement and understanding among the
parties hereto and supersede any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof. This Agreement shall
become effective upon receipt by the Bank of counterparts hereof signed by each
of the parties hereto.

     Section 9.10.  Confidentiality. The Bank agrees to hold all nonpublic
information obtained pursuant to the requirements of this Agreement in
accordance with its customary procedure for handling confidential information of
this nature and in accordance with safe and

                                      -47-

<PAGE>

sound banking practices, provided that nothing herein shall prevent the Bank
from disclosing such information (a) to any other Person if reasonably
incidental to the administration of the Loans, (b) upon the order of any court
or administrative agency, (c) upon the request or demand of any regulatory
agency or authority, (d) which had been publicly disclosed other than as a
result of a disclosure by the Bank prohibited by this Agreement, (e) in
connection with any litigation to which the Bank or its affiliates, subsidiaries
or parent may be a party, (f) to the extent necessary in connection with the
exercise of any remedy hereunder and (g) to the Bank's legal counsel and
independent auditors.

     Section 9.11.  Severability; Modification. If any provision hereof is
invalid or unenforceable in any jurisdictions, then, to the fullest extent
permitted by law, (a) the other provisions hereof shall remain in full force and
effect in such jurisdiction; and (b) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provisions in any other jurisdiction.

                  [Remainder of Page Intentionally Left Blank]

                                      -48-

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.

                                            TREX COMPANY, LLC

160 Exeter Drive
Winchester, VA  22603-8605
Facsimile: (540) 542-6889
                                            By: /s/ Anthony J. Cavanna
                                                --------------------------
                                            Name: Anthony J. Cavanna
                                            Title: Executive Vice President and
                                                     Chief Financial Officer

                                            TREX COMPANY, INC.

160 Exeter Drive
Winchester, VA  22603-8605
Facsimile:  (540) 542-6889
                                            By: /s/ Anthony J. Cavanna
                                                --------------------------
                                            Name: Anthony J. Cavanna
                                            Title: Executive Vice President and
                                                     Chief Financial Officer

                                            BRANCH BANKING AND TRUST COMPANY
                                            OF VIRGINIA

115 North Cameron Street
Winchester, VA  22601
Facsimile: (540) 665-4210
Attention:  David Chandler

                                            By: /s/ David A. Chandler
                                                --------------------------
and                                         Name: David A. Chandler
                                            Title: Senior Vice President

110 South Stratford Road
Suite 301
Winston-Salem, NC  27104
Facsimile:  (336) 733-3254
Attention:  Cory Boyte

                                      -49-

<PAGE>

                              DEFINITIONS APPENDIX

     The definitions set forth in this Definitions Appendix are incorporated by
reference into Section 1.01 of the Credit Agreement dated as of June 19, 2002
among TREX Company, LLC, Trex Company, Inc. and Branch Banking and Trust Company
of Virginia (as the same may be amended, modified or supplemented from time to
time, the "Credit Agreement"). References in this Definitions Appendix to "this
Agreement," "herein," "hereof," "hereunder" and to any Article or Section shall
be interpreted to mean the Credit Agreement and the referenced Article or
Section, including this Definitions Appendix.

                                   DEFINITIONS

     "Accounts" means all "accounts" (as defined in the UCC) now owned or
hereafter acquired or arising by the Borrower, including any rights to payment
for the sale or lease of goods or rendition of services, whether or not they
have been earned by performance.

     "Acquisition," by any Person (herein called the "Acquiror"), means any
transaction involving the purchase, lease or other acquisition by such Acquiror
of (a) all or a material portion of the assets of another Person or (b) all of
the capital stock of another Person which would become an Affiliate of the
Acquiror as a result thereof.

     "Additional Subsidiary Pledgor" has the meaning set forth in Section 6.23.

     "Affiliate" means (a) any Person that directly, or indirectly through one
or more intermediaries, controls the Borrower (a "Controlling Person") or (b)
any Person (other than the Borrower or a Subsidiary) which is controlled by or
is under common control with a Controlling Person. As used herein, the term
"control" means possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.

     "Agreement" means this Credit Agreement, as it may be amended, restated,
supplemented or otherwise modified from time to time.

     "Applicable Revolving Loan Margin" means (i) 3.00% for the period from the
Closing Date through and including the first day of the month following receipt
by the Bank of the consolidated financial statements described in Section
6.01(b) for the period ending June 30, 2002 and (ii) thereafter shall be
determined by reference to the Total Consolidated Debt to Consolidated EBITDA
Ratio in accordance with the following table:

         Total Consolidated Debt to                    Applicable Revolving
         Consolidated EBITDA Ratio                     Loan Margin

             Equal to or higher than 3.0 to 1               3.25%

             Equal to or higher than 2.5 to 1               3.00%

<PAGE>

          but lower than 3.0 to 1

          Equal to or higher than 2.0 to 1                   2.75%
          but lower than 2.5 to 1

          Equal to or higher than 1.5 to 1                   2.25%
          but lower than 2.0 to 1

          Equal to or higher than 1.0 to 1                   1.75%
          but lower than 1.5 to 1

          Lower than 1.0 to 1                                1.50%

Except during the initial period described in clause (i) above, the Applicable
Revolving Loan Margin will be automatically adjusted as of the first day of the
month following receipt by the Bank of consolidated financial statements of the
Borrower and its Consolidated Subsidiaries pursuant to Section 6.01(a) or
Section 6.01(b) demonstrating to the Bank's reasonable satisfaction that there
has been a change in the Total Debt to EBITDA Ratio which would cause a change
in the Applicable Revolving Loan Margin in accordance with the preceding table.
Any such change shall apply to the Revolving Loans outstanding on such effective
date or made on or after such effective date. At all times after and during the
continuance of a Default with respect to the Borrower's obligations under
Section 6.01(a) or Section 6.01(b) until the delivery of the applicable
financial statements required pursuant thereto, the Applicable Revolving Loan
Margin shall be 3.25%.

     "Applicable Real Estate Term Loan Margin" means (i) 3.25% for the period
from the Closing Date through and including the first day of the month following
receipt by the Bank of the consolidated financial statements described in
Section 6.01(b) for the period ending June 30, 2002 and (ii) thereafter shall be
determined by reference to the Total Consolidated Debt to Consolidated EBITDA
Ratio in accordance with the following table:

          Total Consolidated Debt to                   Applicable Real Estate
          Consolidated EBITDA Ratio                    Term Loan Margin

          Equal to or higher than 3.0 to 1                   3.50%

          Equal to or higher than 2.5 to 1                   3.25%
          but lower than 3.0 to 1

          Equal to or higher than 2.0 to 1                   3.00%
          but lower than 2.5 to 1

          Equal to or higher than 1.5 to 1                   2.50%
          but lower than 2.0 to 1

          Equal to or higher than 1.0 to 1                   2.00%

<PAGE>

          but lower than 1.5 to 1

          Lower than 1.0 to 1                                1.75%

Except during the initial period described in clause (i) above, the Applicable
Real Estate Term Loan Margin will be automatically adjusted as of the first day
of the month following receipt by the Bank of consolidated financial statements
of the Borrower and its Consolidated Subsidiaries pursuant to Section 6.01(a) or
Section 6.01(b) demonstrating to the Bank's reasonable satisfaction that there
has been a change in the Total Debt to EBITDA Ratio which would cause a change
in the Applicable Real Estate Term Loan Margin in accordance with the preceding
table. Any such change shall apply to Real Estate Term Loans 1, 2, 3 & 4
outstanding on such effective date. At all times after and during the
continuance of a Default with respect to the Borrower's obligations under
Section 6.01(a) or Section 6.01(b) until the delivery of the applicable
financial statements required pursuant thereto, the Applicable Real Estate Term
Loan Margin shall be 3.50%.

     "Bank" means Branch Banking and Trust Company of Virginia, a Virginia
banking corporation, and its successors and assigns.

     "Base Rate" means, for any day, the Prime Rate for such day plus 1%.

     "Base Rate Loan" means a Loan which bears interest at the Base Rate.

     "Benefit Arrangement" means at any time an employee benefit plan within the
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and
which is maintained or otherwise contributed to by any member of the ERISA
Group.

     "Borrower" means TREX Company, LLC, a Delaware limited liability company,
Trex Company, Inc., a Delaware corporation and their successors.

     "Borrowing Base" has the meaning set forth in Section 2.01(c).

     "Borrowing Base Certificate" means a certificate of the Borrower
substantially in the form of Exhibit B attached hereto and executed by the chief
financial officer of the Borrower that contains a computation of the Borrowing
Base and such other information as the Bank shall require.

     "Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in the Commonwealth of Virginia or the State of North
Carolina are authorized by law to close.

     "Capital Lease" means, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.

<PAGE>

     "Capital Stock" for purposes of Section 6.16 means, with respect to any
Person, any and all shares, interests, participations and other equivalents
(howsoever designated and whether or not voting) in equity of such Person,
including, without limitation, all common stock and preferred stock.

     "Cash Equivalents" means (a) direct obligations of the United States or any
agency thereof, or obligations guaranteed by the United States of any agency
thereof, (b) prime commercial paper (rated A1 or better by Standard & Poor's
Rating Group or P1 or better by Moody's Investors Service, Inc.) with maturities
of ninety (90) days or less, or (c) time deposits with, including certificates
of deposit issued by, any office located in the United States of any bank or
trust company which is organized under the laws of the United States or any
state thereof and has capital, surplus and undivided profits aggregating at
least $250,000,000, provided in each case that such investment matures within
one year from the date of acquisition thereof by the Borrower.

     "Change of Control" shall be deemed to have occurred if any "person" (as
such term is used in section 13(d) and section 14(d)(2) of the Exchange Act as
in effect on the Closing Date) or persons constituting a Group, other than any
one or more of the Management Stockholders, becomes the "beneficial owner" (as
such term is used in Rule 13d-3 under the Exchange Act as in effect on the
Closing Date), directly or indirectly, of more than 50% of the total voting
power of all classes then outstanding of the Voting Stock of Trex Company, Inc.

     "Closing Date" means the date, not later than June 30, 2002, on which the
Bank determines that the conditions specified in or pursuant to Section 4.01
have been satisfied.

     "Collateral" means, collectively, the Winchester Property, as more
particularly described in the Deed of Trust, the collateral described in the
Security Agreement, and the collateral described in each of the additional
security agreements and the additional pledge agreements executed and delivered
pursuant to Section 6.23.

     "Collateral Agent" means Branch Banking and Trust Company of Virginia, a
Virginia banking corporation, in its capacity as collateral agent under the
Security Agreement and the Intercreditor Agreement, and any successor.

     "Commercial Letter of Credit Application" has the meaning set forth in
Section 2.01(d)(1)(a).

     "Compliance Certificate" means a certificate of the Borrower substantially
in the form of Exhibit C attached hereto and executed by the chief financial
officer of the Borrower that (i) contains a computation of each of the financial
ratios and other covenants contained in Sections 6.09 to and including 6.13 as
of the end of the period described therein, (ii) certifies that no Default or
Event of Default has occurred as of the end of such period and (iii) that
contains such additional information as the Bank shall require.

     "Consolidated EBITDA" means, as of the date of determination, the net
income (excluding extraordinary gains and extraordinary non-cash losses) plus
interest, taxes,

<PAGE>

depreciation and amortization of the Borrower and its Consolidated Subsidiaries
determined on a consolidated basis as of such date.

     "Consolidated Net Income" means, for any period, the net income (or loss)
of the Borrower and its Consolidated Subsidiaries (excluding extraordinary gains
and extraordinary non-cash losses as determined in accordance with GAAP) for
such period, as set forth in the financial statements required to be delivered
pursuant to Section 6.01(a) or Section 6.01(b) for such period.

     "Consolidated Subsidiary" means with respect to any Person at any date any
Subsidiary of such Person or other entity the accounts of which would be
consolidated with those of such Person in its consolidated financial statements
if such statements were prepared as of such date in accordance with GAAP.

     "Consolidated Tangible Net Worth" means, as of the date of determination,
stockholders' equity of the Borrower and its Subsidiaries less goodwill and less
all other items properly classified as "intangible assets" in accordance with
GAAP.

     "Debt" of any Person means, at any date, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (c)
all obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable arising in the ordinary course of
business), (d) all obligations of such Person as lessee under Capital Leases;
(e) all obligations of such Person under (i) a synthetic, off-balance sheet or
tax retention lease or (ii) an agreement for the use or possession of property
creating obligations that do not appear on the balance sheet of such Person but
which, upon the insolvency or bankruptcy or such Person, would be characterized
as the Debt of such Person (without regard to accounting treatment), (f) all
obligations of such Person to purchase securities or other property which arise
out of or in connection with the sale of the same or substantially similar
securities or property, (g) all obligations, contingent or otherwise, of such
Person to reimburse any bank or other person in respect of amounts paid under a
letter of credit, bankers' acceptance or similar instrument, (h) all obligations
of others secured by a Lien on any asset of such Person, whether or not such
obligation is assumed by such Person, (i) all net obligations of any such Person
pursuant to Derivatives Obligations which are required to be disclosed as
liabilities in accordance with GAAP, and (j) all obligations of others
Guaranteed by such Person; provided, however, that Debt shall not include
Guarantees of obligations of TREX Company, LLC or Trex Company, Inc.

     "Deed of Trust" means the Credit Line Deed of Trust, dated as of the
Closing Date, substantially in the form of Exhibit J hereto, between TREX
Company, LLC and the trustee named therein and describing the Winchester
Property, that secures the Real Estate Term Loan Obligations, as it may be
amended, restated, supplemented or otherwise modified from time to time.

     "Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.

<PAGE>

     "Default Rate" has the meaning set forth in Section 2.05(c).

     "DENPLAX Agreement" means the Addenda to Business Agreement and Shareholder
Contract dated April 26, 2000 between Empresa de Gestion Medioambiental, S.A.,
Trex Company, Inc., Sorema, S.A., RIH Recycling Industries Holding, S.A., and
DENPLAX, S.A.

     "Derivatives Obligations" of any Person means all obligations of such
Person in respect of any interest rate swap transaction, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.

     "Disqualified Stock" means any capital stock of Trex Company, Inc. that, by
its terms (or by the terms of any security into which it is convertible at the
option of the holder thereof or for which it is exchangeable at the option of
the holder thereof), or upon the happening of any event, (a) is mandatorily
redeemable or is redeemable at the option of the holder thereof for cash prior
to the Revolving Credit Termination Date, or (b) requires the payment of
dividends in cash or other periodic cash payments with respect thereto prior to
the Revolving Credit Termination Date.

     "Dollars" and the sign "$" means lawful money of the United States of
America.

     "Domestic Subsidiary" means a Subsidiary or Affiliate (excluding TREX
Company, LLC) that is a corporation, limited liability company, partnership or
other legal entity or joint venture organized or formed under the laws of any
state of the United States of America or the District of Columbia.

     "Effective Date" means the date of this Agreement.

     "Eligible Account" has the meaning set forth in Section 2.01(c).

     "Eligible Inventory" has the meaning set forth in Section 2.01(c).

     "Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment, including, without limitation, ambient air, surface water,
groundwater or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the cleanup or other
remediation thereof.

<PAGE>

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.

     "ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.

     "Event of Default" has the meaning set forth in Section 7.01.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time.

     "Existing Letter of Credit" means that certain irrevocable standby letter
of credit issued on May 6, 2002 for the benefit of Treasurer, County of
Frederick in the face amount of $108,756 with an expiry date of August 14, 2002.

     "Facility Debt" means Debt of the Borrower and/or its Subsidiaries that (a)
bears interest at a fixed rate, (b) has no principal payments due on or prior to
the Revolving Credit Termination Date and (c) has its stated maturity after the
Revolving Credit Termination Date.

     "First Union Loan Agreement" means the Amended and Restated Credit
Agreement dated as of September 30, 2001 by and between the Borrower and First
Union National Bank.

     "Fixed Asset Proceeds" has the meaning set forth in Section 6.14(b)(ii)(B).

     "Fixed Charge Coverage Ratio" means, for the four-quarter period ending on
the date of measurement, the ratio of (i) the sum of Consolidated EBITDA for
such four-quarter period plus the consolidated operating lease expense of the
Borrower and its Subsidiaries for such four-quarter period minus cash taxes for
such four-quarter period minus Maintenance Capital Expenditures for such
four-quarter period minus cash dividends and redemptions or purchases of Capital
Stock of Trex Company, Inc. for cash for such four-quarter period made pursuant
to Section 6.16(h), to (ii) the sum of current maturities of long-term debt of
the Borrower and its Consolidated Subsidiaries for such four-quarter period,
consolidated interest expense of the Borrower and its Consolidated Subsidiaries
for such four-quarter period, and consolidated operating lease expense of the
Borrower and its Subsidiaries for such four-quarter period; provided that any
principal payments due to Wachovia Bank, National Association (formerly known as
First Union National Bank) on Term Loan A (as defined in the First Union Loan
Agreement) due on each of March 1, 2002, April 1, 2002, May 1, 2002, June 1,
2002 or July 1, 2002 shall be excluded from current maturities of long-term debt
of the Borrower and its Consolidated Subsidiaries.

     "Foreign Subsidiary" or "Foreign Joint Venture" means a Subsidiary or
Affiliate that is not a Domestic Subsidiary.

<PAGE>

     "GAAP" means generally accepted accounting principles as in effect from
time to time in the United States of America.

     "Governmental Account" has the meaning set forth in Section 2.01(c).

     "Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

     "Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.

     "Group" means any group of "persons" (as such term is used in section 13(d)
and section 14(d)(2) of the Exchange Act as in effect on the Closing Date)
constituting a "group" for the purposes of section 13(d) of the Exchange Act, or
any successor provision.

     "Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt or other obligation of
any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
by agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (b)
entered into for the purpose of assuring in any other manner the obligee of such
Debt or other obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part), provided that the term
"Guarantee" shall not include (a) endorsements for collection or deposit in the
ordinary course of business or (b) the DENPLAX Agreement. The term "Guarantee"
used as a verb has a corresponding meaning.

     "Hazardous Substances" means any toxic, radioactive, caustic or otherwise
hazardous substance, including petroleum, its derivatives, by-products and other
hydrocarbons, or any substance having any constituent elements displaying any of
the foregoing characteristics.

     "Intercreditor Agreement" means the Intercreditor and Collateral Agency
Agreement dated as of June 19, 2002, by and among the Collateral Agent, the
Bank, and the noteholders party thereto, as it may be amended, as amended,
restated, supplemented or otherwise modified from time to time.

     "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.

     "Inventory" means all "inventory" (as defined in the UCC) now owned or
hereafter acquired by the Borrower, including all goods and merchandise,
wherever located, to be furnished under any contract of service or held for sale
or lease, all returned goods, raw materials, work-in-process, finished goods
(including embedded software), other materials and supplies of any kind, nature
or description which are used or consumed in the Borrower's

<PAGE>

business or used in connection with the packing, shipping, advertising, selling
or finishing of such goods or merchandise.

     "Inventory Sublimit" means (a) $10,000,000 during the period from May 1,
2002 to and including September 30, 2002, (b) $12,000,000 during the period from
May 1, 2003 to and including September 30, 2003, (c) $14,000,000 during the
period from May 1, 2004 to and including September 30, 2005 and (e) during any
period of time not covered by clauses (a) to and including (d) above, the
Revolving Commitment.

     "Investment" means as to any Person any direct or indirect purchase or
other acquisition by such Person of stock or other securities of any other
Person, or any direct or indirect loan, advance (other than advances to
employees for moving and travel expenses, drawing accounts and similar
expenditures in the ordinary course of business) or capital contribution by such
Person to any other Person, including all debt and accounts receivable from such
other Person which are not current assets or did not arise from sales to such
other Person in the ordinary course of business.

     "ISDA Master Agreement" means that certain agreement between the Borrower
and Branch Banking and Trust Company dated as of June 19, 2002, and all
amendments thereto and transactions thereunder.

     "Item" means any "item" as defined in Section 4-104 of the UCC and shall
also mean and include checks, drafts, money orders or other media of payment.

     "Letter of Credit" has the meaning set forth in Section 2.01(d).

     "Letter of Credit Applications" means a Commercial Letter of Credit
Application or a Standby Letter of Credit Application.

     "Letter of Credit Obligations" means, at any time, an amount equal to the
sum of (i) the aggregate undrawn and unexpired amount of the then outstanding
Letters of Credit, and (ii) the aggregate amount of drawings under Letters of
Credit which have not been reimbursed pursuant to Section 2.01(d)(3).

     "LIBOR" means, for any day, the rate of interest (rounded upwards, if
necessary to the nearest 1/100 of 1%) reported on Telerate page 3750 (or any
successor page) as the one-month London interbank offered rate for deposits in
U.S. dollars at approximately 11:00 a.m., London time (or, if not so reported,
then as determined by the Bank from another recognized source of interbank
quotation), on the first day of the calendar month in which such day occurs (or,
if such day is not a Business Day, on the preceding Business Day), as adjusted
from time to time in the Bank's sole discretion (for its customers with loans
bearing interest based on LIBOR generally) for then applicable reserve
requirements, deposit insurance assessments and other regulatory costs.

     "Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset.
For the purposes of this Agreement, the Borrower or any Subsidiary shall be
deemed to own subject to a Lien any asset

<PAGE>

which it has acquired or holds subject to the interest of a vendor or lessor
under any conditional sale agreement, Capital Lease or other title retention
agreement relating to such asset.

     "Loan Documents" means this Agreement, the Notes, the Deed of Trust, the
Security Agreement, all related financing statements, the Letter of Credit
Applications, the ISDA Master Agreement, the Intercreditor Agreement, the
Services Agreement, each subsidiary security agreement, each subsidiary guaranty
and each subsidiary pledge agreement executed and delivered pursuant to Section
6.23 hereof, and each other document, instrument or agreement executed and
delivered by the Borrower, its Subsidiaries or their counsel in connection with
this Agreement or otherwise referred to herein or contemplated hereby, all as
amended, restated, supplemented or otherwise modified from time to time.

     "Loans" means the Revolving Loans, and Real Estate Term Loans 1, 2, 3 & 4
made or existing pursuant to Section 2.01 and Section 2.02.

     "Maintenance Capital Expenditures" means, as of the date of determination,
actual capital expenditures of the Borrower and its Consolidated Subsidiaries
for the purpose of maintaining existing assets.

     "Management Stockholder Affiliates" mean, at any time, and with respect to
any Person who is a Management Stockholder, any other Person that at such time
directly or indirectly through one or more intermediaries Controls, or is
Controlled by, or is under common control with, such Management Stockholder. As
used in this definition, "Control" means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise.

     "Management Stockholders" means Robert G. Matheny, Anthony J. Cavanna,
Andrew W. Ferrari, Roger A. Wittenberg, Harold F. Monahan, Paul D. Fletcher,
Joseph L. Bradford, William R. Gupp and David W. Jordan, and their respective
Management Stockholder Affiliates.

     "Material Adverse Effect" means (a) any material adverse effect upon the
condition (financial or otherwise), results of operations, properties, assets,
business or prospects of the Borrower or of the Borrower and its Consolidated
Subsidiaries, taken as a whole; (b) a material adverse effect on the ability of
the Borrower to consummate the transactions contemplated hereby to occur on the
Closing Date; (c) a material adverse effect on the ability of the Borrower to
perform its obligations under this Agreement or any of the other Loan Documents;
or (d) a material adverse effect on the rights and remedies of the Bank under
this Agreement or any of the other Loan Documents.

     "Material Contract" means (a) any contract or other agreement, written or
oral, of the Borrower or any of its Subsidiaries involving monetary liability of
or to any such Person in an amount in excess of $250,000, or (b) any other
contract or agreement, written or oral, of the Borrower or any of its
Subsidiaries the failure to comply with which could reasonably be expected to
have a Material Adverse Effect.

<PAGE>

     "Material Debt" means Debt (other than the Notes) of the Borrower and/or
one or more of its Subsidiaries, arising in one or more related or unrelated
transactions, in an aggregate principal or face amount exceeding $250,000.

     "Material Financial Obligations" means a principal or face amount of Debt
(other than the Notes) and/or payment obligations in respect of Derivatives
Obligations of the Borrower and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, exceeding in the aggregate
$250,000.

     "Material Plan" means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $25,000.

     "Material Subsidiary" means collectively each Domestic Subsidiary that is a
member of the Material Subsidiary Group.

     "Material Subsidiary Group" as of any date means either (i) the smallest
number of Domestic Subsidiaries that account for (or in the case of a recently
formed or acquired Domestic Subsidiary would so account for on a pro forma
historical basis), when combined with the Borrower, at least 90% of Consolidated
EBITDA for either of the two most recently ended fiscal years of the Borrower,
or (ii) the smallest number of Domestic Subsidiaries that account for (or in the
case of a recently formed or acquired Domestic Subsidiary would so account for
on a pro forma historical basis), when combined with the Borrower, at least 90%
of Consolidated Tangible Net Worth for either of the two most recently ended
fiscal years of the Borrower; provided that any Domestic Subsidiary that
accounts for (or in the case of a recently formed or acquired Domestic
Subsidiary would so account for on a pro forma historical basis) 7 1/2% of
either Consolidated EBITDA for either of the two most recently ended fiscal
years of the Borrower or Consolidated Tangible Net Worth for either of the past
two most recently ended fiscal years of the Borrower, shall be included in the
Material Subsidiary Group.

     "Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five-year period.

     "Net Proceeds" means (i) with respect to any borrowed money Debt, the
aggregate cash proceeds received by the Borrower or any of its Subsidiaries in
connection with the incurrence of such borrowed money Debt, after deducting
therefrom all reasonable and customary costs and expenses incurred by the
Borrower or such Subsidiary directly in connection with the incurrence of such
borrowed money Debt; provided, however, that (1) the proceeds of the Note
Agreement and (2) the proceeds of borrowed money Debt permitted under Section
6.08 shall not be Net Proceeds; and (ii) with respect to any stock issued by the
Borrower or any of its Subsidiaries, the seventy-five percent (75%) of the
aggregate cash proceeds received by the Borrower or any of its Subsidiaries in
connection with the private or public issuance of any such stock, after
deducting therefrom all reasonable and customary costs and expenses incurred by
the Borrower or such Subsidiary directly in connection with the issuance of such
stock; provided, however, that the

<PAGE>

proceeds of common capital stock or options to purchase common capital stock
issued by Trex Company, Inc. pursuant to its employee stock purchase plan or
stock option and incentive plan shall not be Net Proceeds.

     "Nevada Deed of Trust" has the meaning set forth in Section 6.07(a).

     "Nevada Real Estate" has the meaning set forth in Section 6.07(a).

     "Note Agreement" means the Note Purchase Agreement dated as of June 19,
2002 by and between the Borrower and the noteholders party thereto relating to
the Borrower's $40,000,000 8.32% senior secured notes due June 19, 2009, as it
may be amended, restated, supplemented or otherwise modified from time to time.

     "Notes" means the Revolving Note, Real Estate Term Loan 1 Note, Real Estate
Term Loan 2 Note, Real Estate Term Loan 3 Note and Real Estate Term Loan 4 Note.

     "Notice of Borrowing" has the meaning set forth in Section 2.02(a).

     "Operating Account" means the demand deposit account maintained with the
Bank by the Borrower on which the Borrower draws checks to pay its operating
expenses, which account is linked to the cash management services provided by
the Bank to the Borrower pursuant to the Services Agreement.

     "PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.

     "Permitted Liens" has the meaning set forth in Section 6.07.

     "Person" means an individual, a corporation, a partnership, an association,
a trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

     "Personal Property Casualty Loss Proceeds" means any insurance,
condemnation or other proceeds resulting from the damage, destruction, or other
loss of furniture, fixtures, equipment or other fixed assets of the Borrower or
any Subsidiary (but specifically excluding the real property and the
improvements thereon encumbered by the Deed of Trust or the Nevada Deed of
Trust); provided, however, that the term "Personal Property Casualty Loss
Proceeds" shall not include any proceeds of less than $1,000,000 in the
aggregate in any fiscal year of the Borrower that the Borrower or any Subsidiary
receives prior to the occurrence of a Default or Event of Default if such
proceeds are used by the Borrower or the applicable Subsidiary to acquire
replacement fixed assets or to repair the damaged, destroyed or otherwise lost
fixed asset within 210 days of the occurrence of such damage, destruction or
other loss.

     "Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any

<PAGE>

member of the ERISA Group for employees of any member of the ERISA Group or (ii)
has at any time within the preceding five years been maintained, or contributed
to, by any Person which was at such time a member of the ERISA Group for
employees of any Person which as at such time a member of the ERISA Group.

     "Prime Rate" means the rate announced by the Bank from time to time, as its
Prime Rate, as such rate may change from time to time with changes to occur on
the date the Bank's Prime Rate changes. The Bank's Prime Rate is one of several
interest rate bases used by the Bank. The Bank lends at rates above and below
the Bank's Prime Rate, and the Borrower acknowledges that the Bank's Prime Rate
is not represented or intended to be the lowest or most favorable rate of
interest offered by the Bank.

     "Proceeds" means all proceeds of, and all other profits, products, rents or
receipts, in whatever form, arising from the collection, sale, lease, exchange,
assignment, licensing or other disposition of or other realization upon or
payment for the use of, Collateral, including (without limitation) all claims of
the Borrower against third parties for loss of, damage to or destruction of or
for proceeds payable under, or unearned premiums with respect to, policies of
insurance in respect of, any Collateral, and any condemnation or requisition
payments with respect to any Collateral, in each case whether now existing or
hereafter arising.

     "Pro Forma Total Consolidated Debt to Consolidated EBITDA Ratio" means, as
of the date of determination, the pro forma ratio of (i) the total of all Debt
of the Borrower, its Subsidiaries and the Person being acquired outstanding on
such date, after eliminating all offsetting debits and credits between the
Borrower and its Subsidiaries and all other items required to be eliminated in
the course of the preparation of consolidated financial statements of the
Borrower and its Subsidiaries in accordance with GAAP to (ii) Consolidated
EBITDA (excluding the Person being acquired) as of such date.

     "Quarterly Date" means the first Business Day of each January, April, July
and October.

     "Real Estate Term Loan Collateral" means, collectively, all of the
collateral described in the Deed of Trust and any additional collateral
described in any additional security agreements or pledge agreements that secure
the Real Estate Term Loan Obligations.

     "Real Estate Term Loan Obligations" means:

          (i)  all principal of and interest (including, without limitation, any
interest which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Borrower,
whether or not allowed or allowable as a claim in any such proceeding) on Real
Estate Term Loans 1, 2, 3 & 4, fees payable or reimbursement obligations under,
Real Estate Term Loan 1, Real Estate Term Loan 2, Real Estate Term Loan 3, or
Real Estate Term Loan 4;

          (ii) all other amounts now or hereafter payable by the Borrower and
all other obligations or liabilities now existing or hereafter arising or
incurred (including, without limitation, any amounts which accrue after the
commencement of any case, proceeding or other

<PAGE>

action relating to the bankruptcy, insolvency or reorganization of the Borrower,
whether or not allowed or allowable as a claim in any such proceeding) on the
part of the Borrower pursuant to Real Estate Term Loan 1, Real Estate Term Loan
2, Real Estate Term Loan 3, or Real Estate Term Loan 4;

          (iii) all Derivatives Obligations (including, without limitation, all
amounts payable with respect to the ISDA Master Agreement and any amounts which
accrue after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency or reorganization of the Borrower, whether or not
allowed or allowable as a claim in any such proceeding) of the Borrower to
Branch Banking and Trust Company;

          (iv)  all other indebtedness, obligations and liabilities of the
Borrower to the Bank or Branch Banking and Trust Company, now existing or
hereafter arising or incurred, whether or not evidenced by notes or other
instruments, and whether such indebtedness, obligations and liabilities are
direct or indirect, fixed or contingent, liquidated or unliquidated, due or to
become due, secured or unsecured, joint, several or joint and several, but
excluding the Revolving Credit Loan Obligations; and

          (v)   all renewals, modifications, consolidations or extensions of or
to each of the obligations described in clauses (i) to and including (iv) above.

     "Real Estate Term Loan 1" has the meaning set forth in Section 2.01(a).

     "Real Estate Term Loan 2" has the meaning set forth in Section 2.01(a).

     "Real Estate Term Loan 3" has the meaning set forth in Section 2.01(a).

     "Real Estate Term Loan 4" has the meaning set forth in Section 2.01(a).

     "Real Estate Term Loan 1 Note" means a promissory note of the Borrower,
dated as of the Closing Date, substantially in the form of Exhibit D hereto,
evidencing the obligation of the Borrower to repay Real Estate Term Loan 1, as
it may be amended, restated, supplemented or otherwise modified from time to
time.

     "Real Estate Term Loan 2 Note" means a promissory note of the Borrower,
dated as of the Closing Date, substantially in the form of Exhibit E hereto,
evidencing the obligation of the Borrower to repay Real Estate Term Loan 2, as
it may be amended, restated, supplemented or otherwise modified from time to
time.

     "Real Estate Term Loan 3 Note" means a promissory note of the Borrower,
dated as of the Closing Date, substantially in the form of Exhibit F hereto,
evidencing the obligation of the Borrower to repay Real Estate Term Loan 3, as
it may be amended, restated, supplemented or otherwise modified from time to
time.

     "Real Estate Term Loan 4 Note" means a promissory note of the Borrower,
dated as of the Closing Date, substantially in the form of Exhibit G hereto,
evidencing the obligation of the

<PAGE>

Borrower to repay Real Estate Term Loan 4, as it may be amended, restated,
supplemented or otherwise modified from time to time.

     "Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

     "Reserves" has the meaning set forth in Section 2.01(c).

     "Revolving Commitment" means $20,000,000.00 or such lesser amount to which
it is reduced pursuant to Section 2.07.

     "Revolving Credit Loan Collateral" means, collectively, all of the
collateral described in the Security Agreement, and any additional collateral
described in any additional security agreements or pledge agreements that secure
the Revolving Credit Loan Obligations.

     "Revolving Credit Loan Collateral Documents" mean, collectively, the
Security Agreement, and all additional security agreements, pledge agreements or
guaranties that secure the Revolving Credit Loan Obligations.

     "Revolving Credit Loan Obligations" means:

          (i)   all principal of and interest (including, without limitation,
any interest which accrues after the commencement of any case, proceeding or
other action relating to the bankruptcy, insolvency or reorganization of the
Borrower, whether or not allowed or allowable as a claim in any such proceeding)
on the Revolving Loan, Letters of Credit, fees payable or reimbursement
obligation under, or any note issued pursuant to, the Letters of Credit, the
Revolving Loan or the Security Agreement;

          (ii)  all other amounts now or hereafter payable by the Borrower and
all other obligations or liabilities now existing or hereafter arising or
incurred (including, without limitation, any amounts which accrue after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Borrower, whether or not allowed or
allowable as a claim in any such proceeding) on the part of the Borrower
pursuant to the Letters of Credit, the Revolving Note or the Security Agreement;
and

          (iii) all renewals, modifications, consolidations or extensions of or
to each of the obligations described in clauses (i) to and including (ii) above.

     "Revolving Credit Period" means the period from and including the Effective
Date to but not including June 30, 2005.

     "Revolving Credit Termination Date" means the earlier to occur of June 30,
2005, or the date of termination by the Bank pursuant to 7.01.

     "Revolving Loan" means a loan made pursuant to Section 2.01(b).

<PAGE>

     "Revolving Note" means a promissory note of the Borrower, dated as of the
Closing Date, substantially in the form of Exhibit I hereto, evidencing the
obligation of the Borrower to repay the Revolving Loans, as it may be amended,
restated, supplemented or otherwise modified from time to time.

     "SEC" means the United States Securities and Exchange Commission, and any
successor thereto.

     "Security Agreement" means the Security Agreement, dated as of the Closing
Date, substantially in the form of Exhibit H hereto, between the Borrower and
the Collateral Agent, dated as of the Closing Date, that secures, inter alia,
the Revolving Credit Loan Obligations, as it may be amended, restated,
supplemented or otherwise modified from time to time.

     "Services Agreement" means the BB&T Treasury Services Agreement, dated as
of June 6, 2002, between the Borrower and the Bank, as it may be amended,
restated, supplemented or otherwise modified from time to time.

     "Shareholder Rights Plan" means a plan adopted by the Board of Directors of
Trex Company, Inc. which provides for a distribution to some or all of the
stockholders of Trex Company, Inc. of rights which entitle the holders thereof
to exercise special voting rights and/or to purchase Capital Stock of Trex
Company, Inc. (other than Disqualified Stock ) or another Person (other than
Disqualified Stock) at a discounted value, provided that no stockholder shall be
entitled to any cash distribution in connection therewith.

     "Solvent" means, as to the Borrower and its Subsidiaries on a particular
date, that they, taken as a whole, (a) have capital sufficient to carry on their
business and transactions and all business and transactions in which they are
about to engage and are able to pay their debts as they mature, (b) own property
having a value, both at fair valuation and at present fair saleable value,
greater than the amount required to pay their probable liabilities (including
contingencies), and (c) do not believe that they will incur debts or liabilities
beyond their ability to pay such debts or liabilities as they mature.

     "Standby Letter of Credit Application" has the meaning set forth in Section
2.01(d)(1)(b).

     "Subsidiary" means any corporation or other entity of which securities or
other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by Trex Company, Inc.

     "Total Consolidated Capitalization" means, as of any date of determination
with respect to the Borrower, the sum of Total Consolidated Debt and
Consolidated Tangible Net Worth.

     "Total Consolidated Debt" means, as of the date of determination, the total
of all Debt of the Borrower and its Subsidiaries outstanding on such date, after
eliminating all offsetting debits and credits between the Borrower and its
Subsidiaries and all other items required to be

<PAGE>

eliminated in the course of the preparation of consolidated financial statements
of the Borrower and its Subsidiaries in accordance with GAAP.

     "Total Consolidated Debt to Consolidated EBITDA Ratio" has the meaning set
forth in Section 6.11.

     "Total Consolidated Debt to Total Consolidated Capitalization Ratio" has
the meaning set forth in Section 6.10.

     "UCC" means the Uniform Commercial Code as in effect on the date hereof in
the Commonwealth of Virginia, provided that if by reason of mandatory provisions
of law, for matters pertaining only to the perfection or the effect of
perfection or nonperfection of the security interest in or lien on any of the
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than Virginia, "UCC" means the Uniform Commercial Code as in
effect in such other jurisdiction for purposes of the provisions hereof relating
to such perfection or effect of perfection or nonperfection.

     "Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (a) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan but only to the extent that such excess
represents a potential liability of a member of the ERISA Group to the PBGC or
any other Person under Title IV of ERISA.

     "United States" means the United States of America, including the states
and the District of Columbia, but excluding its territories and possessions.

     "Unused Amount of the Revolving Commitment" means the Revolving Commitment
less the aggregate amount of Revolving Loans.

     "Unused Commitment Fee" has the meaning set forth in Section 2.06.

     "Unused Commitment Fee Percentage" means (i) 0.50% per annum for the period
from the Closing Date through and including the first day of the month following
receipt by the Bank of the consolidated financial statements described in
Section 6.01(b) for the period ending June 30, 2002 and (ii) thereafter shall be
the rate per annum determined by reference to the Total Consolidated Debt to
Consolidated EBITDA Ratio in accordance with the following table:

         Total Consolidated Debt to
         Consolidated EBITDA Ratio             Unused Commitment Fee Percentage

         Equal to or higher than 3.0 to 1                  0.50%
         but lower than 3.5 to 1

<PAGE>

          Equal to or higher than 2.5 to 1                0.50%
          but lower than 3.0 to 1

          Equal to or higher than 2.0 to 1                0.50%
          but lower than 2.5 to 1

          Equal to or higher than 1.5 to 1               0.375%
          but lower than 2.0 to 1

          Equal to or higher than 1.0 to 1                0.25%
          but lower than 1.5 to 1

          Lower than 1.0 to 1                             0.25%

Except during the initial period described in clause (i) above, the Unused
Commitment Fee Percentage will be automatically adjusted as of the first day of
the month following receipt by the Bank of consolidated financial statements of
the Borrower and its Consolidated Subsidiaries pursuant to Section 6.01(a) or
Section 6.01(b) demonstrating to the Bank's reasonable satisfaction that there
has been a change in the Total Debt to EBITDA Ratio which would cause a change
in the Unused Commitment Fee Percentage in accordance with the preceding table.
At all times after and during the continuance of a Default with respect to the
Borrower's obligations under Section 6.01(a) or Section 6.01(b) until the
delivery of the applicable financial statements required pursuant thereto, the
Unused Commitment Fee Percentage shall be 3.0%.

     "Voting Stock" means, with respect to any Person, capital stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.

     "Warrant" means the common stock purchase warrant issued by Trex Company,
Inc. to First Union National Bank (now known as Wachovia Bank, National
Association) dated as of November 13, 2001, and any common stock purchase
warrant subsequently issued in exchange, replacement or substitution therefor or
for any subsequently issued warrant.

     "Wholly-Owned Subsidiary" means, with respect to a Subsidiary, a Subsidiary
all the shares, member interests or equivalent equity interests of which (other
than any director's qualifying shares or investments by foreign nationals
mandated by applicable law) are, directly or indirectly, owned or controlled by
the Borrower and/or one or more of its Wholly-Owned Subsidiaries.

     "Winchester Property" means the Borrower's real estate and the improvements
thereon located in the City of Winchester, Virginia and the County of Frederick,
Virginia, as more particularly described in the Deed of Trust.

     "Winchester Property Casualty Loss Proceeds" means any insurance,
condemnation or other proceeds resulting from the damage, destruction, or other
loss of the real property and the improvements thereon encumbered by the Deed of
Trust; provided, however, that the term

<PAGE>

"Winchester Property Casualty Loss Proceeds" shall not include any proceeds of
less than $1,000,000 in the aggregate in any fiscal year of the Borrower that
the Borrower receives prior to the occurrence of a Default or Event of Default
if such proceeds are used by the Borrower to repair such damaged, destroyed or
otherwise lost real property and the improvements thereon within 360 days of the
occurrence of such damage, destruction or other loss.

                                      USAGE

     The following rules of construction and usage shall be applicable to any
instrument that is governed by this Appendix:

     (a)  All terms defined in this Appendix shall have the defined meanings
when used in any instrument governed hereby and in any certificate or other
document made or delivered pursuant thereto unless otherwise defined therein.

     (b)  The words "hereof," "herein," "hereunder" and words of similar import
when used in an instrument refer to such instrument as a whole and not to any
particular provision or subdivision thereof; references in any instrument to
"Article," "Section" or another subdivision or to an attachment are, unless the
context otherwise requires, to an article, section or subdivision of or an
attachment to such instrument; and the term "including" means "including,
without limitation."

     (c)  The definitions contained in this Appendix are equally applicable to
both the singular and plural forms of such terms and to the masculine as well as
to the feminine and neuter genders of such terms.

     (d)  Any agreement, instrument or statute defined or referred to below or
in any agreement or instrument that is governed by this Appendix means such
agreement or instrument or statute as from time to time amended, restated,
supplemented or otherwise modified from time to time, including (in the case of
agreements or instruments) by waiver or consent and (in the case of statutes) by
succession of comparable successor statutes and includes (in the case of
agreements or instruments) references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.

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