EXHIBIT 4.5

                                   DEMAND NOTE

$700,000.00                                                    FEBRUARY 9, 2004

         FOR VALUE RECEIVED, the undersigned, Metalico, Inc., a Delaware
Corporation, having executive offices in Cranford, New Jersey ("Maker") hereby
promises to pay to Carlos E. Aguero, the President and Chief Executive Officer
of Maker ("Payee"), in lawful money of the Untied States of America and in
immediately available funds, the principal sum of Seven Hundred Thousand Nine
($700,000.00), together with interest on the principal balance from time to time
outstanding at an annual rate of Five Percent (5%), at such address designated
by Payee (the "Note") payable as follows:

Interest is payable monthly and principal shall be due and payable in full on
Demand, but if Demand is not made payment in full no later than February 9,
2005, except that the Note may be redeemed within five (5) business days of the
date upon which Maker shall have completed an initial public offering of its
common stock (the "IPO").

The occurrence of any of the following shall constitute a default ("Default")
hereunder:

         (a)      if Maker shall fail to make payment of principal or interest
                  on this Note or any other note or obligation of Maker to Payee
                  within 14 days of when the same shall become due and payable;

         (b)      if a petition under any chapter of Title 11 of the United
                  States Code (or any similar law of the United States or other
                  jurisdiction) shall be filed by or against Maker.

         Upon or at any time after the occurrence of any Default the Payee or
         any holder hereof may declare due and payable the entire or any portion
         of the unpaid balance of the Note by giving Notice as provided
         hereunder. If, within fifteen (15) days following receipt of such
         Notice the Maker has not repaid all principal and interest demanded by
         said Notice, the Payee shall be entitled to a judgment in the amount of
         such principal and interest then due, and Payee shall have no other
         rights or remedies for Maker's default hereunder, in law or equity,
         except those rights and remedies to enforce only those entitlement
         specifically described herein.

         At the option of the Maker, the unpaid balance of this Note may be
         prepaid in whole or in part, from time to time, except that the Maker
         shall nevertheless remain liable to the Payee for any additional
         interest which it would otherwise have been required to pay had the
         Note not been prepaid.

         Except as otherwise expressly provided herein, the Maker of this Note
         hereby waives presentment for payment, demand for payment, dishonor,
         notice of dishonor, protest




         and notice of protest, and any and all other requirements necessary to
         hold it liable as Maker.

         The liability of Maker hereunder shall be unconditional. No act,
         failure or delay by the holder hereof to declare a Default as set forth
         herein or to exercise any rights to declare such Default or to exercise
         any such right or remedy at such time as it shall determine in its sole
         discretion. The Maker further agrees to pay all costs of litigation in
         case it becomes necessary to protect the security hereof.

         This Note shall be binding upon Maker, its successors and assigns, and
         shall inure to the benefit of the Payee. The Payee shall not assign its
         rights hereunder.

         This Note is given and accepted as evidence of indebtedness only and
         not in payment or satisfaction of any indebtedness or obligation. Time
         is of the essence with respect to all of Maker's obligations and
         agreements under this Note.

         Dated: February 9, 2004

ATTEST:                                  METALICO, INC.  MAKER



                                         By:
----------------------------------          -----------------------------------
                                            Michael J. Drury
                                         Its: Executive Vice President


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