Financial Advisor and Chief Restructuring Advisor - Engagement Letter

Exhibit 10.4


Rockefeller Center
620 Fifth Avenue [TRIAX CAPITAL 2nd Floor ADVISORS LOGO] New York, NY 10020
212.332-4011
Fax: 212 332.4019
www.triaxadvisors.com


July 23, 2004 Mark Alsentzer Chairman of the Board U.S. Plastic Lumber Corp. 2300 W. Glades Rd., Suite 4400 Boca Raton, FL 33431


Re: Engagement as Financial Advisor and Chief Restructuring Advisor


Dear Mr. Alsentzer:


We are writing this letter to confirm our agreement (the "Agreement") that U.S. Plastic Lumber Corp. et al. (the "Debtors" or the "Company") in the Chapter 11 cases currently pending in the United States Bankruptcy Court for the Southern District of Florida will engage Triax Capital Advisors, LLC ("Triax") to provide financial and restructuring advisory services and to serve as Chief Restructuring Officer on behalf of the Company which includes, but is not limited to, analyzing, assisting and developing a financial restructuring plan involving the Company, assisting the Company in a developing and negotiating a plan of reorganization with its creditors, selling the Company's assets, and/or raising additional debt/equity capital for the Company, providing turnaround and crisis management services, and any other tasks that may be requested by the Company. Triax shall provide the Company with the services of Joseph Sarachek to serve as Chief Restructuring Officer and at least one additional professional to work for the Company as set forth below.


This Agreement shall become effective as of July 23, 2004 upon the execution hereof by both the Company and Triax and approval of the Bankruptcy Court and shall terminate at any time after thirty (30 days) upon reasonable notice by the Company or Triax, subject to Bankruptcy Court approval. This agreement shall supercede any previous agreements executed by the Company. Neither termination nor completion of this assignment shall effect: a) any compensation earned by Triax up to the date of termination; b) any compensation which Triax is otherwise entitled to hereunder; c) the reimbursement of expenses incurred by Triax up to the date of termination; d) the attached indemnification provisions, which are incorporated herein, all of which shall remain in full force and effect.


Compensation of Services


Subject to approval by the United States Bankruptcy Court, and pursuant to the provisions of the Bankruptcy Code and Rules:


I. The Company shall pay Triax an hourly fee of $375 for senior
professionals, $250 for junior professionals and $100 for associates
("Hourly Fee"), beginning July 23, 2004 with a monthly maximum
compensation on hourly fees of $75,000 per month.


TRIAX CAPITAL ADVISORS, LLC
U.S. Plastic LumberCorp.


II. In addition to the Hourly Fee, the Company shall pay Triax a Transaction
Fee (the "Transaction Fee"), which is contingent upon the consummation of
a sale or sales of assets, a refinancing or repurchase of the secured
debt, or any other financial restructuring which provides aggregate gross
proceeds (whether in cash or other-in-kind consideration, including
assumption and forgiveness of debt ) as follows:


Gross Proceeds Cumulative Transaction Fee - -------------- -------------------------- From 0 to $5,000,000 3%, plus From $5,000,000 to $7,500,000 4% of the incremental, plus From $7,500,000 to $10,000,000 5% of the incremental, plus, Over $10,000,000 6% of any amount over $10,000,000


III. In addition to the Hourly Fee and Transaction Fee, the Company shall pay
Triax a Financing Fee (the "Financing Fee") of 1% of the aggregate amount
of any Financing, whether it be DIP Financing or exit financing committed
to the Company. The Financing Fee shall be paid out of the proceeds of any
Financing.


IV. Triax shall be reimbursed for all reasonable out-of-pocket expenses
incurred in carrying out the terms of this Agreement, including telephone,
travel, facsimile, courier, computer time charges and attorneys' fees (to
the extent necessary), food, messenger services, postage and copying.


V. The Transaction Fee and any accrued Hourly Fees that are due and owing,
shall be paid upon the earlier of i) a plan of reorganization is
confirmed, ii) a sale of, a portion or, substantially all of the assets;
or iii) a financing which provides that AMPAC Capital Solutions, LLC. is
no longer providing debtor in possession financing to the Company; iv) a
Trustee is appointed or the Company's cases are converted to Chapter 7;
and v) Triax's services have been terminated pursuant to this agreement.


All compensation and reimbursement of expenses are subject to prior approval of the Bankruptcy Court in accordance with sections 330 and 331 of the Bankruptcy Code. Triax agrees to include in its application for approval of compensation a narrative of services performed and will, to the best of its ability, include the time ...