AMENDMENT NO. 8 TO FINANCING AGREEMENT

Exhibit 10.2

AMENDMENT NO. 8 TO FINANCING AGREEMENT

This AMENDMENT NO. 8 TO FINANCING AGREEMENT (this “ Amendment ”) is entered into as of July 27, 2009 (the “ Amendment Date ”) but effective as to the provisions so specified below as of June 30, 2009, by and among METALICO, INC. , a Delaware corporation (“ Borrower ”), each Subsidiary of Borrower listed as a “Guarantor” on the signature pages hereto (each a “ Guarantor ” and collectively, jointly and severally, the “ Guarantors ”), the lenders signatory hereto (each a “ Lender ” and collectively, the “ Lenders ”), ABLECO FINANCE LLC, a Delaware limited liability company (“ Ableco ”), as collateral agent for the Lenders (in such capacity, together with any successor collateral agent, the “ Collateral Agent ”), and Ableco, as administrative agent for the Lenders (in such capacity, together with any successor administrative agent, the “ Administrative Agent ” and together with the Collateral Agent, each an “ Agent ” and collectively, the “ Agents ”).

W I T N E S S E T H:

WHEREAS , the Borrower, the Guarantors, the Agents and the Lenders are parties to that certain Financing Agreement, dated as of July 3, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the “ Financing Agreement ”; capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in the Financing Agreement as amended hereby);

WHEREAS, the Borrower has requested that the Agents and Required Lenders make certain amendments to the Financing Agreement;

WHEREAS , the Borrower recently made a principal pre-payment in the amount of $2,700,000 (the “ First Tax Refund Prepayment ”) pursuant to Section 2.05(c)(vii) of the Financing Agreement, which pre-payment constitutes the proceeds of Collateral consisting of a payment received in respect of Borrower’s 2008 Federal tax refund and in respect of any net operating loss carrybacks received by any of the Loan Parties ; and

WHEREAS, upon the terms and conditions set forth herein, the Agents and Required Lenders are willing to accommodate the Borrower’s request.

NOW THEREFORE , in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

(a)  Amendment to Section 1.01. Section 1.01 of the Financing Agreement is hereby amended by adding the following definitions in the appropriate alphabetical positions:

“ Eighth Amendment ” means that certain Amendment No. 8 to Financing Agreement and Consent, dated as of July 27, 2009, by and among the Borrower, the Guarantors, the Lenders, and the Agents.”

“ Eighth Amendment Effective Date ” has the meaning set forth in Section 2 of the Eighth Amendment.”

(b)  Amendment to Section 2.04(i) . Section 2.04(i) of the Financing Agreement is hereby amended and restated in its entirety as follows:

“(i) In the event that the Borrower does not make the Equity Proceeds Payment provided for in Section 3 of the Eighth Amendment on or before August 31, 2009, then the interest rate set forth in each of Sections 2.04(a), 2,04(b) and 2.04(c) shall be immediately and automatically increased by 2.0 percentage points (2.0%) as a result of such failure. For avoidance of doubt, the interest rate increase provided for in this Section 2.04(i) is in addition to, and total interest due will be computed on a cumulative basis with, accrual of interest at the Post Default Rate as provided in Section 2.04(d).”

(c)  Amendment to Section 2.05(c)(ix) . Section 2.05(c)(ix) of the Financing Agreement is hereby amended and restated in its entirety to read as follows:

“(ix) On the Eighth Amendment Effective Date, the Borrower will prepay the Term Loans in the aggregate amount of five million dollars ($5,000,000), which prepayment shall be applied to the outstanding principal amounts of the Term Loans on a pro rata basis.”

(d)  Correction of Amendment to Section 7.02(m) . The parties hereto hereby acknowledge and agree that the amendment set forth in Section 1(k) of Amendment No. 6 to Financing Agreement among the parties dated February 27, 2009 (the “Sixth Amendment”) was inadvertently designated as an amendment to Section 7.02(n) of the Financing Agreement in the Sixth Amendment and is hereby designated as an amendment to Section 7.02(m) of the Financing Agreement. For avoidance of doubt, the following text is the text that is being retroactively deleted from the end of Section 7.02(n) and retroactively added to the end of Section 7.02(m), effective as of the Sixth Amendment Effective Date:

“Notwithstanding anything to the contrary set forth in this Section 7.02(m) and to the extent permitted under the Convertible Notes Subordination Agreement, the Borrower may at any time and from time to time propose to the holders of the Convertible Subordinated Indebtedness to exchange on customary terms and conditions reasonably satisfactory to Administrative Agent, and to consummate the exchange of, all or any portion of the outstanding Convertible Notes for Capital Stock of the Borrower that is not Preferred Stock (i.e. that is Borrower’s common stock) (such exchange a “ Permitted Equity for Debt Exchange” ). For avoidance of doubt, (i) any Permitted Equity for Debt Exchange shall be a straight exchange of Subordinated Notes for common stock of the Borrower, (ii) such Permitted Equity for Debt Exchange shall not include any component of cash, new debt issuance, or other non-common stock compensation, premium, consent fee, amendment fee or other delivery of any kind or description directly or indirectly to or for the benefit of the holders of Subordinated Notes that tender Subordinated Notes into the exchange offer, and (ii) no Capital Stock of the Borrower may be issued for cash for the purpose of exchanging such cash for Subordinated Notes. Borrower may incur and directly pay customary and reasonable fees, including attorneys’ fees, accounting fees, investment banking fees, dealer-manager fees or financial advisor fees, in each case provided that the payment of such fees shall not result in the occurrence of a Default or Event of Default under this Agreement.”

(e)  Amendment to Section 7.02 . Section 7.02 of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by adding a new Section 7.02(t) at the end thereof as follows:

“(t) Minimum Reserve Under Foothill Loan Agreement . Permit Foothill to reduce the reserve (the “ Tenth Amendment Reserve ”) against availability under the Foothill Loan Agreement that is established under the Tenth Amendment to Amended and Restated Loan and Security Agreement, entered into by Borrower and Foothill concurrently with the execution and delivery of the Eighth Amendment to less than $20,000,000, provided , however , that if (i) no Default or Event of Default has occurred and is continuing, and (ii) the $10 million payment required under Section 3 of the Eighth Amendment has been received by Administrative Agent, then the Tenth Amendment Reserve may be reduced by up to $10 million without further consent from the Administrative Agent. In no event shall the Tenth Amendment Reserve be reduced below $10 million without the prior written consent of the Administrative Agent.”

(f)  Amendment to Section 7.03(a) . Section 7.03(a) of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by deleting the same in its entirety and inserting the following text in place thereof:

“(a) Leverage Ratio . (i) With respect to the fiscal quarters ending June 30, 2009, September 30, 2009 and December 31, 2009, permit the ratio of (x) Consolidated Funded Indebtedness of Borrower and its Subsidiaries as of the last day of each fiscal quarter set forth below to (y) for any fiscal quarter end set forth on the table below, the actual aggregate amount of Consolidated EBITDA of the Borrower and its Subsidiaries for the fiscal period commencing on January 1, 2009 and ending on the last day of such fiscal quarter, to be greater than the applicable ratio set forth below:

(ii) For each fiscal quarter ending on and after March 31, 2010, Administrative Agent shall establish required maximum leverage ratios for each test period ending on the last day of each fiscal quarter ending on and after March 31, 2010, to be computed (A) as the ratio of Consolidated Funded Indebtedness of Borrower and its Subsidiaries as of the last day of each applicable fiscal quarter to TTM EBITDA of the Borrower and its Subsidiaries for the period ended as of the last day of such fiscal quarter, (B) with reference to the projections to be delivered during December, 2009 pursuant to Section 7.01(a)(vii) and (C) otherwise in such manner as Administrative Agent may determine in its sole and absolute discretion, provided, that if Administrative Agent and Borrower cannot agree on such revised maximum ratios on or before January 31, 2010, then for purposes of Section 7.03(a) , the leverage ratios set forth opposite each fiscal quarter ending on and after March 31, 2010 shall be deemed for all purposes to be 2.50:1.00.”

(g)  Amendment to Section 7.03(c) . Section 7.03(c) of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by deleting the indicated coverage ratios pertaining to the fiscal quarters ending on June 30, 2009, September 30, 2009 and December 31, 2009 and inserting in place thereof the following ratios:

(h)  Amendment to Section 7.03(c). Section 7.03(c) of the Financing Agreement is hereby further amended effective for all purposes as of June 30, 2009, by deleting the last paragraph thereof and inserting in place thereof the following:

“Administrative Agent shall establish required minimum Fixed Charge Coverage Ratios for each fiscal period ending on the last day of each fiscal quarter ending on and after March 31, 2010 to be computed (A) on the basis of a trailing twelve month fiscal period ending on the last day of each fiscal quarter ending on and after March 31, 2010, (B) with reference to the projections to be delivered during December, 2009 pursuant to Section 7.01(a)(vii) and (C) otherwise in such manner as Administrative Agent may determine in its sole and absolute discretion, provided, that if Administrative Agent and Borrower cannot agree on such revised minimum ratios on or before January 31, 2010, then for purposes of Section 7.03(c) , the Fixed Charge Coverage Ratios set forth opposite each fiscal quarter ending on and after March 31, 2010 shall be deemed to be 1.00:1.00.”

(i)  Amendment to Section 7.03(d) . Section 7.03(d) of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by deleting the same in its entirety and inserting the following text in place thereof:

“(d) Consolidated EBITDA/TTM EBITDA . (i) With respect to the fiscal quarters ending June 30, 2009, September 30, 2009 and December 31, 2009, permit the actual aggregate amount of Consolidated EBITDA of the Borrower and its Subsidiaries for the fiscal period commencing on January 1, 2009 and ending on the last day of such fiscal quarter, to be less than set forth below:

(ii) For each fiscal quarter ending on and after March 31, 2010, Administrative Agent shall establish required minimum TTM EBITDA for the trailing twelve month fiscal period ending on the last day of each fiscal quarter ending on and after March 31, 2010, to be computed (A) on the basis of a trailing twelve month fiscal period ending on the last day of each fiscal quarter ending on and after March 31, 2010, (B) with reference to the projections to be delivered during December, 2009 pursuant to Section 7.01(a)(vii) and (C) otherwise in such manner as Administrative Agent may determine in its sole and absolute discretion, provided, that if Administrative Agent and Borrower cannot agree on such revised minimum TTM EBITDA on or before January 31, 2010, then for purposes of Section 7.03(d) , the TTM EBITDA set forth opposite each fiscal quarter ending on and after March 31, 2010 shall be deemed to be $14,860,000.“

(j)  Amendment to Section 7.03(f) . Section 7.03(f) of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by deleting the indicated Working Assets amount pertaining to each calendar month ending on or after June 30, 2009 and inserting in place thereof the following Working Assets amount:

Administrative Agent shall establish required minimum Working Assets for each period ending on the last Business Day of each calendar month on and after January 31, 2010 based on the projections to be delivered during December, 2009 pursuant to Section 7.01(a)(vii) in such manner as Administrative Agent may determine in its sole and absolute discretion, provided, that if Administrative Agent and Borrower cannot agree on such revised minimum Working Assets on or before January 31, 2010, then for purposes of Section 7.03(f) , the minimum Working Assets currently set forth opposite each calendar month ending on and after January 31, 2010 shall be $51,776,000.”

(k)  Amendment to Section 7.03 . Section 7.03 of the Financing Agreement is hereby amended effective for all purposes as of June 30, 2009, by adding a new Section 7.03(g) at the end thereof as follows:

“(g) Minimum Monthly Consolidated EBITDA . With respect to each fiscal month commencing with the fiscal month ending June 30, 2009, permit the actual amount of Consolidated EBITDA of the Borrower and its Subsidiaries for such fiscal month to be less than $250,000.”

(l)  Amendment to Section 9.01(a) . Section 9.01(a) of the Financing Agreement is hereby amended by adding the following new proviso at the end thereof: “ provided , however , that any failure to make a mandatory pre-payment due under Section 3 of the Eighth Amendment shall not constitute an Event of Default under this Section 9.01(a) but instead shall be treated for all purposes as a covenant default to which Section 9.01(d) shall be applicable, such that, for avoidance of doubt, the fifteen day cure period afforded to Borrower under Section 9.01(d) shall apply.”

2.  Covenant Regarding Turnover of 2008 Tax Refunds; Minimum Payment Due .