EXHIBIT 10.1
METALICO, INC.
SECOND AMENDED AND RESTATED
STOCKHOLDERS' AGREEMENT
THIS SECOND AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT, dated as of May
24, 2004 (this "Agreement"), by and among Metalico, Inc., a Delaware corporation
("Company"), the Persons executing this Agreement as Holders of Securities, and
such other Persons that become parties hereto after the date of this Agreement
in accordance with the terms and provisions contained herein (collectively,
"Holders"). This Agreement amends and restates in its entirety that certain
Amended and Restated Stockholders' Agreement dated as of May 31, 2001 by and
among the Company and the Holders.
PRELIMINARY STATEMENT
Certain of the Holders own shares of Common Stock, par value $0.001 per
share, of the Company ("Common").
Certain of the Holders own shares of Preferred Stock, par value $0.001 per
share, of the Company ("Preferred").
Upon the terms and subject to the conditions of the Exchange Agreement
(defined below), the Holders of Preferred are exchanging their shares of
existing preferred stock in the Company for shares of Preferred, on the terms
set forth therein.
It is in the best interests of the Company and the Holders to memorialize
certain aspects of all of the Holders' stock ownership and the rights of the
Holders and the Company relating thereto, all as hereinafter set forth.
In consideration of the mutual covenants and agreements contained herein,
and in order to induce the Investors to enter into the exchange set forth in the
Exchange Agreement, the parties agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. As used in this Agreement, the following terms
herein shall have the following meanings:
"Argentum" means Argentum Capital Partners, L.P., a Delaware limited
partnership.
"Argentum II" means Argentum Capital Partners II, L.P., a Delaware limited
partnership.
"Board" means the Board of Directors of the Company.
"Charter" means the Third Amended and Restated Certificate of
Incorporation of the Company, as such may be amended from time to time.
"Exchange Agreement" means the Exchange Agreement of even date herewith
among the Company and the Holders of Preferred party thereto, as such agreement
may be amended from time to time.
"First Analysis Entities" means Apex Investment Fund III, LP, a Delaware
limited partnership, Apex Strategic Partners, LLC, a Delaware limited liability
company, Infrastructure & Environmental Private Equity Fund III, LP, a Delaware
limited partnership, Environmental & Information Technology Private Equity Fund
III, a civil partnership with limitation of liability established under the laws
of the Federal Republic of Germany, and The Productivity Fund III, L.P., a
Delaware limited partnership.
"Fully Diluted Securities" means all issued and outstanding shares of
Common, all shares of Common issuable upon conversion of the Preferred, and all
shares of Common which may be directly or indirectly issuable upon the exercise,
exchange or conversion of any other Securities.
"Investors" means First Analysis Entities, RFE, Seacoast Capital,
Argentum, Argentum II and Kitty Hawk and the Persons who have executed the
signature pages to this Agreement as Holders other than the Management Holders.
"Kitty Hawk" means Kitty Hawk Capital Limited Partnership IV, a Delaware
limited partnership.
"Person" means an individual, partnership, corporation, business trust,
limited liability company, joint stock company, trust, unincorporated
association, joint venture, or other entity of whatever nature.
"RFE" means RFE Investment Partners V, L.P., a Delaware limited
partnership.
"Seacoast Capital" means Seacoast Capital Partners Limited Partnership, a
Delaware limited partnership.
"Securities" means any equity securities of the Company, whether now or
hereafter authorized or issued, and any instrument convertible into, or
exercisable or exchangeable for, any such Securities or Security.
"Securities Act" means the Securities Act of 1933, as amended.
"Stock" means shares of Common and Preferred.
"Subsidiary" has the meaning provided in the Charter.
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ARTICLE 2
DIRECTORS
SECTION 2.1 Election of Directors.
(a) The Company and each of the Holders agree that, so long as any
Preferred remains outstanding and is not converted to Common pursuant to the
terms of the Charter, the voting agreement set forth in this Section 2.1 shall
remain in effect, and each Holder shall take all action necessary from time to
time (including, without limitation, the voting of Securities, the execution of
written consents, the calling of special meetings, the removal of directors, the
filling of vacancies on the Board, the waiving of notice and attendance at
meetings, the amendment of the Company's bylaws and the like) necessary to
maintain the membership of the Board as follows:
(i) The number of directors composing the Board shall be no more
than seven (7);
(ii) So long as Seacoast Capital owns at least 75% of the Preferred
owned by Seacoast Capital on the date hereof, Seacoast Capital shall designate
one (1) nominee for election to the Board (the "Seacoast Capital Nominee");
(iii) So long as the First Analysis Entities collectively own at
least 75% of the Preferred owned by the First Analysis Entities on the date
hereof, the First Analysis Entities shall designate one (1) nominee for election
to the Board ("First Analysis Nominee");
(iv) So long as RFE owns at least 75% of the Preferred owned by RFE
on the date hereof, RFE shall designate one (1) nominee for election to the
Board ("RFE Nominee");
(v) So long as Argentum and Argentum II collectively own at least
75% of the Preferred collectively owned by Argentum and Argentum II on the date
hereof, Argentum and Argentum II shall together designate one (1) nominee for
election to the Board ("Argentum Nominee") (the Seacoast Nominee, the First
Analysis Nominee, the RFE Nominee and the Argentum Nominee being referred to
collectively herein as the "Preferred Nominees").
(vi) By their execution of this Agreement the Holders agree that
the initial Preferred Nominees shall consist of ▇▇▇▇▇▇ ▇▇▇▇▇▇ (the Seacoast
Capital Nominee), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the First Analysis Nominee), ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
(the RFE Nominee) and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (the Argentum Nominee).
(b) The remaining directors shall be elected by the holders of all
voting Securities voting together as a single class, with each holder of
convertible Securities being entitled to cast the number of votes as equals the
number of votes which could be cast by such holder upon conversion of such
convertible Securities.
(c) The Persons entitled to name a director pursuant to subsections
2.1(a)(ii), (iii),
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(iv), and (v) are referred to in this Section as the "Principals" with respect
to that director. If the Principals give notice at any time to the Company and
the other Holders that an individual then serving as a director of the Company
at such Principals' designation is no longer their designee, then the Company
and the Holders shall take all action necessary to remove the director so
designated.
(d) If an individual then serving as a director of the Company dies,
resigns, or is removed as a director of the Company pursuant to Section 2.1(c)
above, then the Company and the Holders shall take all action necessary to elect
as a director of the Company any individual newly designated by the Principals
with respect to the director who died, resigned, or was removed.
(e) If a Principal shall no longer be entitled to name a director
pursuant to Section 2.1(a)(ii), (iii), (iv) or (v), so long as the remaining
Investors collectively own 50% of the Preferred owned collectively by all
Investors on the date hereof, such remaining Investors, voting together as a
group, shall designate the nominee for election to the Board previously
designated by such Principal.
(f) This Section 2.1 constitutes a voting agreement within the meaning
of Section 218 of the Delaware General Corporation Law.
Section 2.2 Reimbursement of Expenses. The Company agrees to reimburse
each director for the reasonable out-of-pocket expenses incurred by such
director in performing his or her services as a director of the Company or any
Subsidiary, including expenses incurred in connection with attendance at
meetings of the Board.
Section 2.3 Committee Composition. At least one Preferred Nominee shall
serve on each standing and special committee of the Board.
ARTICLE 3
LOCKUP AGREEMENT
SECTION 3.1 Lockup Agreement. Each Holder agrees in connection with any
registration of any of the Securities that, upon the request of the Company or
the underwriters managing any underwritten offering of the Securities, such
Holder will not sell, make any short sale of, loan, grant any option for the
purchase of, or otherwise dispose of any Securities (other than the Securities
included in the registration) without the prior written consent of the Company
or such underwriters, as the case may be, for such period of time (not to exceed
180 days) from the effective date such registration as the Company or the
underwriters may specify.
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ARTICLE 4
MISCELLANEOUS
SECTION 4.1 Dividends in Stock. If a stock dividend is paid on any Stock
held by any party to this Agreement, or if any Stock held by any party to this
Agreement is exchanged for Stock of a different class or series, or for voting
trust certificates evidencing any beneficial interest in such Stock, or if any
other event (such as a stock split, reclassification, or similar event) shall
occur that any Holders shall receive additional or replacement Securities
(whether of the same or a different class or series), then such Securities of
the same or a different class or series, or such voting trust certificates, as
the case may be, shall thereupon become subject to the provisions of the
Agreement upon the same terms and conditions as the Stock originally covered by
this Agreement.
SECTION 4.2 Legends.
(a) Each certificate evidencing any Stock that is issued to any Holder
shall bear a legend in substantially the following form, unless a Holder
requests and the Company determines that any such Stock is eligible, under Rule
144 of the Securities Act or otherwise, for the removal of such legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY OTHER APPLICABLE FEDERAL OR
STATE SECURITIES LAWS, 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.
(b) In addition to the legend required by Section 4.2(a), each
certificate for Stock issued to any Holder or any subsequent transferee shall be
stamped or otherwise imprinted with any legend required pursuant to applicable
state corporation and securities laws. If any Stock shall cease to be subject to
the restrictions on transfer set forth above or otherwise required herein, the
Company shall, upon written request of the Holder thereof, issue to such Holder
a new certificate evidencing such Stock without the applicable legend required
by Section 4.2(a) endorsed thereon.
(c) The Company may decline to acknowledge or register a transfer of any
Security bearing any legend required hereunder, and may instruct any transfer
agent for its Securities to decline the same, unless the Company is reasonably
satisfied that the Securities being transferred have been registered or are
exempt from registration under applicable securities laws.
SECTION 4.3 Headings. The headings in this Agreement are for convenience
of reference only and shall not control or affect the meaning or construction of
any provisions hereof.
SECTION 4.4 Pronouns. All pronouns and any variations thereof shall be
deemed to refer to the masculine, feminine, singular and plural as the identity
of that Person referred to require.
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SECTION 4.5 Remedies. The parties acknowledge that the Securities are
unique chattels and possess a special, unique and extraordinary character which
would make it difficult to assess the monetary damage which any party hereto
would sustain in the event of a breach hereof by another party hereto and that
in the event of any such breach by any Holder or the Company, the other parties
would be irreparably harmed and could not be made whole by monetary damages. The
Company and each Holder accordingly agree (a) to waive the defense in any action
for specific performance that a remedy at law would be adequate, and (b) that an
aggrieved party hereunder shall be entitled to compel specific performance of
this Agreement, in addition to any other remedy to which they may be entitled at
law or in equity.
SECTION 4.6 Entire Agreement. This Agreement and the other documents and
agreements executed by the parties hereto on this date or referred to herein
together constitute the entire agreement and understanding of the parties hereto
in respect of the subject matter referred to herein and therein, and there are
no restrictions, promises, representations, warranties, covenants, or
undertakings with respect to the subject matter hereof, other than those
expressly set forth or referred to herein or therein. This Agreement supersedes
all prior agreements and understandings between the parties hereto with respect
to the subject matter hereof.
SECTION 4.7 Notices. All communications in connection with this Agreement
shall be in writing and shall be deemed properly given if hand delivered or sent
by telecopier (provided that such communication is confirmed by same-day deposit
in the United States mail first class postage prepaid) or overnight courier with
adequate evidence of delivery or sent by registered or certified mail return
receipt requested and, if to a Holder, addressed to such Holder at its address
as shown on the books of the Company or its transfer agent, and if to the
Company, at its offices at:
Metalico, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or such other addresses or Persons as the recipient shall have designated to the
sender by a written notice given in accordance with this Section. Any notice
called for hereunder shall be deemed given when received.
SECTION 4.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
agreements between Delaware residents entered into and to be performed entirely
within Delaware.
SECTION 4.9 Severability. The invalidity or unenforceability of any
provisions hereof in any jurisdiction shall not affect the validity, legality or
enforceability of the remainder hereof in such jurisdiction or the validity,
legality or enforceability hereof, including any such provision, in any other
jurisdiction, it being intended that all rights and obligations of the parties
hereunder shall be enforceable to the fullest extent permitted by law.
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SECTION 4.10 Agreement to be Bound. Prior to the termination of this
Agreement, no Stock may be transferred to any third party (the "Restricted
Holders") unless such Restricted Holder, prior to such transfer, agrees in
writing, in form and substance satisfactory to the Company, to be bound by the
terms hereof to the same extent and in the same manner as the transferor of such
Stock, a copy of which writing shall be maintained on file with the secretary of
the Company and shall include the address of such Restricted Holder to which
notices hereunder shall be sent. Each such supplementary agreement shall become
effective upon its execution by the Company and the Restricted Holder, and it
shall not require the signatures or the consent of any other party hereto. Upon
such execution such Restricted Holder shall be bound by all the restrictions
placed on Holders hereby, shall be subject to any additional restrictions set
forth in such supplementary agreement and shall enjoy only such rights as are
specifically set forth in such supplementary agreement.
SECTION 4.11 Termination. This Agreement shall terminate and be of no
further force or effect upon the first to occur of (i) the consummation of a
Qualified Offering (as defined in the Charter), (ii) a Conversion Event (as
defined in the Charter), or (iii) the written agreement of the Holders of 95% of
the Fully Diluted Securities held by parties to this Agreement.
SECTION 4.12 Successors, Assigns, Transferees. All representations,
warranties, covenants and agreements of the parties contained in this Agreement
or made in writing in connection herewith, shall, except as otherwise provided
herein, be binding upon and inure to the benefit of their respective successors
and assigns. In addition, and whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of the Holders
are also for the benefit of, and enforceable by, any subsequent Holders of
Securities, except any subsequent holder who acquires any such Security after
such Security has been sold to the public pursuant to an effective registration
statement under the Securities Act or in a sale under Rule 144 of the Securities
Act.
SECTION 4.13 Assurances. The Holders, by the signing hereof, hereby agree
to execute and deliver such other documents and agreements, including but not
limited to assignments, bills of sale, stock powers, or resolutions, as may be
reasonably necessary, desirable or convenient in order to effect the purposes
hereof.
SECTION 4.14 Amendments, Waivers. Any provision hereof may be amended,
modified or supplemented upon the consent in writing by the Company and the
Holders of at least 95% of the Fully Diluted Securities held by parties to this
Agreement, and upon the effectiveness of such amendment, modification or
supplement, all of the Holders will be deemed to be bound thereby.
SECTION 4.15 Counterparts. This agreement may be executed in two or more
counterparts and by facsimile signature, each of which shall be deemed an
original but all of which shall constitute one and the same Agreement.
SECTION 4.16 Arbitration. Any dispute arising in connection with this
Agreement (except any action for specific performance or other forms of
extraordinary equitable relief) shall
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be submitted to binding arbitration in accordance with Section 7.11 of the
Exchange Agreement.
SECTION 4.17 Construction and Representation. The parties understand and
acknowledge that they have each been represented by (or have had the opportunity
to be represented by) counsel in connection with the preparation, execution and
delivery of this Agreement. This Agreement shall not be construed against any
party for having drafted it. Any other Holders have been advised to obtain
independent counsel if they so desire.
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IN WITNESS WHEREOF, the parties hereto have executed this Stockholders'
Agreement as of the date first above written.
THE COMPANY: METALICO, INC., a Delaware corporation
By: _______________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chief Executive Officer
HOLDERS:
APEX INVESTMENT FUND III, LP
By: Apex Management III, LLC, its General Partner
By: First Analysis Apex Management III, LLC,
Managing Member
By: _______________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Member
APEX STRATEGIC PARTNERS, LLC
By: Apex Management III, LLC, its Manager
By: First Analysis Apex Management III, LLC,
Managing Member
By: _______________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Member
INFRASTRUCTURE & ENVIRONMENTAL PRIVATE EQUITY FUND
III, LP
By: Infrastructure and Environmental Private Equity
Management LLC, its General Partner
By: First Analysis IEPEF Management Company III,
LLC, A Member
By: _______________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Member
ENVIRONMENTAL & INFORMATION TECHNOLOGY PRIVATE
EQUITY FUND III, a civil partnership with
limitation of liability established under the laws
of the Federal Republic of Germany
By: Infrastructure and Environmental Private Equity
Management, LLC, its General Partner
By: First Analysis IEPEF Management Company III,
LLC, A Member
By: _______________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Member
THE PRODUCTIVITY FUND III, L.P.
By: First Analysis Management Company III, LLC, its
General Partner
By: _______________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Member
RFE INVESTMENT PARTNERS V, L.P.
By: RFE Associates V, L.P., Its General Partner
By: _______________________________________________
Title: General Partner
SEACOAST CAPITAL PARTNERS LIMITED PARTNERSHIP
By: Seacoast I Advisors, Its General Partner
By: _______________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Member
ARGENTUM CAPITAL PARTNERS, L.P.
By: _______________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, President
BR Associates, General Partner
ARGENTUM CAPITAL PARTNERS II, L.P., a Delaware
limited partnership
By: Argentum Partners II, L.L.C, its General
Partner
By: Argentum Investments, L.L.C., its Managing
Member
By: _______________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Managing Member
KITTY HAWK CAPITAL LIMITED PARTNERSHIP IV, a
Delaware limited partnership
By: Kitty Hawk Partners Limited Liability Company
IV, the General Partner
By: _______________________________________________
Name: _____________________________________________
Title: ____________________________________________
UNITED ALLOYS AND STEEL CORP.
By: _______________________________________________
Name: _____________________________________________
Title: ____________________________________________
___________________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
DANKRIS HOLDINGS, LLC
By ________________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
___________________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇
___________________________________________________
▇▇▇▇ AND ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
___________________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
THE ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ TRUST, UTD JUNE 7, 1995
By ________________________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Trustee
___________________________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
INDIANA TRUST INVESTMENT MANAGEMENT COMPANY
By: _______________________________________________
Name: _____________________________________________
Title: ____________________________________________