USPL Board Approves Clean Earth Sale

U.S. Plastic Lumber Corp. announced that its board of directors approved an Amended and Restated Purchase Agreement to sell Clean Earth Inc., its environmental services and recycling division, to CEI Holding Corp. The closing of this transaction will be subject to approval by the stockholders of USPL and certain other conditions. It is the intent of the parties to close this transaction during July or August, 2002, subject to meeting all conditions precedent to closing.

Mark Alsentzer, USPL's CEO said, "Although the closing of this transaction has been delayed as a result of the difficulty the former purchaser had in raising equity capital, we are very confident that the new Purchaser has the required funding, subject to the conditions precedent within the Purchase Agreement.

USPL's senior lenders will also provide a $10 million Revolving credit line to USPL for two years after the closing of the transaction, subject to conditions within the commitment letter. In addition, GE Capital Corporation and its syndicate lending group have agreed to a two year forbearance of principal payments, subject to certain conditions including the closing of the CEI sale transaction and a payment of $500,000 upon the closing of the CEI sale transaction.

USPL also reported that as part of the financing commitments that are in place, its senior lenders have required a restructuring of USPL's debentures with Stout Partnership, an affiliate of USPL, and the Halifax Fund, L.P.

Alsentzer added, "Given the circumstances, we are satisfied with the terms of the deal we have received on the sale of CEI and we will recommend our stockholders approve the transaction. We will use the proceeds to significantly reduce our debt, and by doing so, we anticipate the balance sheet and liquidity of USPL will be much improved. Coupled with the nearly complete reorganization of our Plastic Lumber operations, we believe USPL should be well positioned to improve its financial condition and profitably grow its remaining business."