EXHIBIT 4.6
[METALICO, INC. LOGO]
THIS NOTE AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
THUS MAY NOT BE TRANSFERRED UNLESS REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND SUCH OTHER LAWS OR
UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
CONVERTIBLE NOTE
$______________________ Cranford, New Jersey
As of September 30, 2004
FOR VALUE RECEIVED, METALICO, INC., a Delaware corporation (the
"Maker") promises to pay to the order of __________________ (the "Payee") or to
an assignee of the Payee approved by the Maker, which approval will not be
unreasonably withheld, the sum of ______________________ Dollars
($____________), with interest on the unpaid principal balance at seven per cent
(7%) per annum, on the date occurring one year after the date first written
above (the "Maturity Date"). Payments of interest will be made monthly in
arrears on the first day of each month until the principal balance hereunder has
been fully retired. If any such day is not a business day, payment will be made
on the next succeeding business day. The Maker will pay interest to the Payee at
such address or to such account as the Payee specifies in writing to the Maker
at least five business days before such payment is to be made.
This Note represents an unsecured obligation of the Maker.
The Payee will have the right, at its option, at any time up to and
including the date (such date the "Conversion Deadline") that is the later to
occur of (a) the date that is two weeks after the effective date of the listing
of the Maker's Common Stock on the American Stock Exchange or any comparable
exchange or its functional equivalent, and (b) December 31, 2004, to convert the
outstanding principal balance of this Note (but not less than the outstanding
balance) into shares of Common Stock of the Maker at the conversion price of
$2.75 per share, promptly after surrender of the Note, accompanied by a written
notice of such conversion to the Maker. Upon such conversion this Note will be
cancelled and the indebtedness of the Maker hereunder will be satisfied. The
Payee will be entitled to registration rights with respect to such Common Stock
issued hereunder comparable to the rights held by holders of the Maker's
Preferred Stock.
The Maker may, at its option, prepay all or any portion of the
outstanding principal balance of this Note, if any, without premium or penalty,
at any time from and including the first day after the Conversion Deadline to
the day before the Maturity Date. All accrued and unpaid interest will be
payable on the date of any prepayment that reduces the outstanding balance of
Principal Amounts to $0.
This Note is issued on and as of the same date as certain other
Convertible Notes made by the Maker containing substantially identical terms
(collectively, the "Convertible Notes"). The terms of this Note may not be
amended, waived, modified or supplemented without the written consent of the
Maker and the holders of all such Convertible Notes. Notwithstanding the
foregoing, the Convertible Notes (including this Note) may be amended or
supplemented, without the consent of any holder of a Convertible Note, to cure
any ambiguity, defect or inconsistency in a manner that does not materially
adversely affect any such holder.
If the Maker defaults for thirty (30) days in the payment when due of
interest on this Note or in the performance of any obligation to the Payee under
this Note, the holders of at least 51% of the then-outstanding principal balance
of Convertible Notes (the "Majority Holders") may declare the principal balance
of the Convertible Notes, together with any accrued interest thereon, to be due
and payable. If, pursuant to or within the meaning of the United States
Bankruptcy Code or any other federal or state law relating to insolvency or
relief of debtors (a "Bankruptcy Law"), the Maker (i) commences a voluntary case
or proceeding, (ii) consents to the entry of an order for relief against it in
an involuntary case, (iii) consents to the appointment of a trustee, receiver,
assignee, liquidator or similar official, (iv) makes an assignment for the
benefit of its creditors, or (v) admits in writing its inability to pay its
debts as they become due; or if a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that (i) is for relief against the
Maker in an involuntary case, (ii) appoints a trustee, receiver, assignee,
liquidator or similar official for the Maker or substantially all of the Maker's
properties, or (iii) orders the liquidation of the Maker, and in each case the
order or decree is not dismissed within 90 days, then the principal balance of
the Convertible Notes, together with any accrued interest thereon, will become
due and payable without further action or notice. The Majority Holders may on
behalf of the holders of all of the Convertible Notes waive any existing default
or event of default except a continuing default in the payment of interest on
the Convertible Notes.
No director, officer, employee, or stockholder of the Maker will have
any liability for any obligations of the Maker under this Note or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
The Payee by accepting this Note waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of this Note.
The Maker of this Note hereby waives presentment, demand, protest and
notice of dishonor and protest.
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The indebtedness evidenced by this Note is subordinate and subject in
right of payment to the prior payment in full of all principal of (and premium,
if any) and interest on all bank financing and other similar indebtedness of the
Maker ("Senior Indebtedness"), whether outstanding on the date of this Note or
thereafter created, incurred or assumed, expressly including, without
limitation, the indebtedness of the Maker arising under that certain Loan and
Security Agreement by and between Xxxxx Fargo Foothill, Inc. (f/k/a Foothill
Capital Corporation), the Maker, and the subsidiaries of the Maker party thereto
dated as of May 31, 2001, as it has been and may be amended form time to time.
If there occurs an event of default which has been declared in writing with
respect to any Senior Indebtedness, as defined therein, or in the instrument
under which it is outstanding, permitting the holder of such Senior Indebtedness
to accelerate the maturity thereof and the Payee has received written notice
thereof from the holder of such Senior Indebtedness, then, unless and until such
event of default has been cured or waived or has ceased to exist, or all such
Senior Indebtedness with respect to which the Maker is in default has been paid
in full, no payment will be made in respect of the principal of or interest on
this Note, unless within one hundred eighty (180) days after the happening of
such event of default, the maturity of such Senior Indebtedness has not been
accelerated. The Payee, by its acceptance hereof, is hereby deemed to
acknowledge and agree that the foregoing subordination provisions are, and are
intended to be, an inducement to and a consideration of each holder of Senior
Indebtedness, whether such Senior Indebtedness was created or acquired before or
after the creation of the indebtedness evidenced by this Note, and each such
holder of Senior Indebtedness will be deemed conclusively to have relied on such
subordination provisions in acquiring and holding, or in continuing to hold,
such Senior Indebtedness.
This Note shall be binding upon the Maker, its successors and assigns,
and shall inure to the benefit of the Payee. It may not be changed or terminated
orally. This Note shall be construed in accordance with the laws of the State of
New Jersey without giving effect to its conflicts of laws provisions.
THE MAKER AND, BY ITS ACCEPTANCE OF THIS NOTE, THE PAYEE HEREBY
VOLUNTARILY, IRREVOCABLY AND UNCONDITIONALLY WAIVE ANY RIGHT TO HAVE A JURY
PARTICIAPTE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE, BETWEEN THE PAYEE AND THE MAKER ARISING OUT OF, IN CONNECTION WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THE MAKER AND
THE PAYEE IN CONNECTION WITH THIS NOTE. THIS PROVISION WILL NOT IN ANY WAY
AFFECT, WAIVE, LIMIT, AMEND OR MODIFY THE PAYEE'S ABILITY TO PURSUE ITS REMEDIES
CONTAINED HEREIN.
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IN WITNESS WHEREOF, the Maker has caused this Note to be signed by its
duly authorized officer as of the date first written above.
METALICO, INC., a Delaware corporation
By:
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Name: Xxxxxx X. Xxxxxx
Title: President
STATE OF NEW JERSEY )
) SS.:
COUNTY OF UNION )
On this 30th day of September, 2004, before me personally came Xxxxxx
X. Xxxxxx, to me known, who, being by me duly sworn, did depose and say that he
is a duly elected officer of the Maker of the above Convertible Note.
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XXXXXX X. XXXXXX
Attorney at Law
In the State of New Jersey
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