SIMS LIMITED — Annual Report 2009

Nov 12, 2009

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

�

• Registration statement pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934

or

� Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended June 30, 2009

or

� Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

or

� Shell company report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of event requiring this shell company report

Commission file number: 001-33983

Sims Metal Management Limited

(Exact name of Registrant as specified in its charter)

N/A

(Translation of Registrant’s name into English)

Victoria, Australia

(Jurisdiction of incorporation or organization)

110 Fifth Avenue, Suite 700 New York, NY 10011 (Address of principal executive offices)

Frank M. Moratti, Company Secretary and Legal Counsel (61 2) 9902-6004; Frank.Moratti@simsmm.com Sir Joseph Banks Corporate Park Suite 3, Level 2, 32-34 Lord Street Botany, NSW 2019, Australia

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class Ordinary Shares American Depositary Shares, each representing one ordinary share

Name of each exchange on which registered New York Stock Exchange* New York Stock Exchange

• Not for trading, but only in connection with the listing of American Depositary Shares pursuant to requirements of the Securities and Exchange Commission.

Securities registered or to be registered pursuant to Section 12(g) of the Act: None.

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None.

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of June 30, 2009: 182,227,569 Ordinary Shares

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

� Yes � No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934.

� Yes � No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

� Yes � No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

� Yes � No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer �

Accelerated filer �

Non-accelerated filer � Smaller reporting company � (Do not check if a smaller reporting company)

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

US GAAP �

International Financial Reporting Standards as issued by the International Accounting Standards Board � Other �

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

� Item 17 � Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

� Yes � No

TABLE OF CONTENTS

PART I Item 1. Identity of Directors, Senior Management and Advisors Item 2. Offer Statistics and Expected Timetable Item 3. Key Information Item 4. Information on the Company Item 4A. Unresolved Staff Comments Item 5. Operating and Financial Review and Prospects Item 6. Directors, Senior Management and Employees Item 7. Major Shareholders and Related Party Transactions Item 8. Financial Information Item 9. The Offer and Listing Item 10. Additional Information Item 11. Quantitative and Qualitative Disclosures About Market Risk Item 12. Description of Securities Other than Equity Securities PART II Item 13. Defaults, Dividend Arrearages and Delinquencies Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds Item 15. Controls and Procedures Item 16A. Audit Committee Financial Expert Item 16B. Code of Ethics Item 16C. Principal Accountant Fees and Services Item 16D. Exemptions from the Listing Standards for Audit Committees Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers Item 16F. Change in Registrant ’ s Certifying Accountant Item 16G. Corporate Governance PART III Item 17. Financial Statements Item 18. Financial Statements Item 19. Exhibits EX - 4.8 EX - 4.13 EX - 4.14 EX - 4.15 EX - 4.17 EX - 4.18 EX - 4.19 EX - 8.1 EX - 12.1 EX - 12.2 EX - 13.1 EX - 15.1 EX - 15.2	Page
	3 3 3 15 27 27 40 50 51 52 53 64 64 64 64 64 66 66 67 67 67 67 67 68 68 68
Item 16F. Change in Registrant ’ s Certifying Accountant Item 16G. Corporate Governance Item 17. Financial Statements Item 18. Financial Statements Item 19. Exhibits EX - 4.8 EX - 4.13 EX - 4.14 EX - 4.15 EX - 4.17 EX - 4.18 EX - 4.19 EX - 8.1 EX - 12.1 EX - 12.2 EX - 13.1 EX - 15.1 EX - 15.2

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EXPLANATORY NOTE

Sims Metal Management Limited is a corporation incorporated in the State of Victoria, Australia. In this annual report, references to “we,” “us,” “our,” “the Group,” “Company,” “company” or “Sims” means Sims Metal Management Limited and its consolidated subsidiaries.

Sims presents its consolidated financial statements in Australian dollars. In this annual report, references to “A$” are to the Australian dollar and references to “US$” are to the United States dollar. Except as otherwise stated, all monetary amounts in this annual report are presented in Australian dollars. References to a particular “fiscal” year are to our fiscal year ended June 30 of such year. References to years not specified as being fiscal years are to calendar years.

Our principal executive offices are located at 110 Fifth Avenue, Suite 700, New York, NY 10011 and our telephone number is (212) 604-0710. Our registered office is located at Sir Joseph Banks Corporate Park, Suite 3, Level 2, 32—34 Lord Street, Botany, New South Wales, Australia, 2019. The telephone number of the registered office is (61 2) 8113 1600.

On March 14, 2008, we acquired Metal Management, Inc., or Metal Management, through a merger transaction in which the stockholders of Metal Management received American Depositary Shares, or ADSs, representing Sims ordinary shares. Where this annual report provides information for dates prior to March 14, 2008, such information does not include the historical information of Metal Management.

We maintain an Internet website at www.simsmm.com. None of the information contained on our website, or on any other website linked to our website, will be incorporated in this annual report by reference or otherwise be deemed to be a part of this annual report.

FORWARD LOOKING STATEMENTS

This annual report contains a number of forward-looking statements, including statements about our financial condition, results of operations, earnings outlook and prospects. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “will,” “seek” and other similar words and expressions.

The forward-looking statements involve certain risks and uncertainties. Our ability to predict results or the actual effects of our plans and strategies is subject to inherent uncertainty. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include those set forth in this annual report under the caption “Risk Factors.”

Because these forward-looking statements are subject to assumptions and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. You are cautioned not to place undue reliance on these statements, which speak only as of the date of this annual report.

Factors that could cause our actual results to differ materially from those contemplated by the forward looking statements include, among others, the following factors:

• the impact of the global financial crisis and recession on our earnings, liquidity and financial condition;

• current disruption in credit markets arising from the global financial crisis and recessionary conditions in many parts of the developed world;

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• cyclicality and volatility in the metal recycling industry;

• exposure to changes in commodity prices, currency exchange rates and interest rates;

• loss of export sales and increased competition from containerized recycled metal exports and substitute materials;

• exposure to customer credit risks;

• termination of material contracts;

• availability of adequate sources of material supply;

• failure to comply with or other liabilities incurred pursuant to applicable laws, including applicable environmental laws;

• the loss of senior executive employees or managers;

• labor problems and compliance with health and safety regulations;

• costs and risks associated with defined benefit pension plans and other employee benefits;

• goodwill and other identified intangible asset impairment and other financial and accounting issues;

• compliance costs and other risks relating to internal control over financial reporting;

• existing and future litigation; and

• the risks of global operations, including international hostilities.

All subsequent written and oral forward-looking statements related to the information contained in this annual report and attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this annual report. Except to the extent required by applicable law or regulation, we undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this annual report or to reflect the occurrence of unanticipated events.

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PART I

Item 1. Identity of Directors, Senior Management and Advisors

Not applicable.

Item 2. Offer Statistics and Expected Timetable

Not applicable.

Item 3. Key Information

A. Selected financial data

A detailed description of our business can be found in “Item 4 — Information on the Company.”

Selected Financial Data

Our consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the Australian Accounting Standards Board, or AASB, and International Financial Reporting Standards as issued by the International Accounting Standards Board. The foregoing accounting standards are referred to collectively in this annual report as IFRS. The selected consolidated income statement data for the fiscal years ended June 30, 2009, 2008 and 2007 and the selected consolidated balance sheet data as of June 30, 2009 and 2008 below are derived from our audited consolidated financial statements prepared in accordance with IFRS, which are included elsewhere in this annual report. The selected consolidated income statement data for the fiscal years ended June 30, 2006 and 2005 and the selected consolidated balance sheet data as of June 30, 2007, 2006 and 2005 are derived from our audited consolidated financial statements prepared in accordance with IFRS, which are not included in this annual report.

In reading the selected historical financial data, please note that on March 14, 2008, we acquired Metal Management and its results are included only for the final 3.5 months in fiscal 2008. See “Item 5 — Operating and Financial Review and Prospects” for additional information regarding the impact of the Metal Management acquisition.

In the year ended June 30, 2009, we revised our accounting policy for the valuation of land, buildings and leasehold improvements from the revaluation method to the historical cost method in accordance with AASB 116, “ Property, Plant and Equipment ” and AASB 108, “Accounting Policies, Changes in Accounting Estimates and Errors. ” This change in accounting policy has been applied retrospectively and is included in the results below.

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		**As of and for **	the fiscal years ended June 30,
	2009 A$	2008 2007 2006 A$ A$ A$ (in thousands, except per share data)		2005 A$
Income statement data in accordance with IFRS:
Revenue	8,641,010	7,670,536 5,550,897 3,754,509		2,565,603
Goodwill impairment charge	(191,094 )	(3,349 ) — —		—
Share of pre-tax profit of investments accounted for using the equity method	60,808	64,573 7,030 4,164		2,626
(Loss)/profit before income tax	(122,162 )	660,603 356,889 269,781		283,226
(Loss)/profit after income tax	(150,295)	440,098 239,938 184,929		196,010
Basic (loss)/earnings per share (cents)	(82.9 )	310.9 192.1 163.9		215.2
Diluted (loss)/earnings per share (cents)	(82.9)	307.9 191.0 163.4		215.0
Weighted average number of shares outstanding	181,247	141,574 124,916 112,857		91,086
Weighted average number of diluted shares outstanding	181,247	142,948 125,620 113,193		91,180
Balance Sheet data in accordance with IFRS:
Total current assets	985,878	2,014,457 792,820 711,642		411,158
Total assets	3,808,560	4,646,476 2,057,371 1,836,632		836,425
Total current liabilities	576,932	1,225,020 473,058 386,221		229,190
Borrowings	175,144	398,414 307,591 301,459		98,946
Total liabilities	949,513	1,812,552 885,284 728,708		365,048
Total equity	2,859,047	2,833,924 1,172,087 1,107,924		471,377

Exchange Rate Data

For the periods indicated, the following table sets forth information concerning the exchange rate between the U.S. dollar and the Australian dollar. The data are expressed in U.S. dollars per Australian dollar and are based on noon buying rates published by the Federal Reserve Bank of New York for the Australian dollar. The average rate for a year means the average of the exchange rates on the last day of each month during that year. The average rate for a month means the average of the daily exchange rates during that month.

	Period end Rate	Average Rate	Highest Rate	Lowest Rate
For the fiscal year ended June 30:
2009	0.8055	0.7483	0.9797	0.6073
2008	0.9562	0.9042	0.9644	0.7860
2007	0.8491	0.7925	0.8491	0.7407
2006	0.7423	0.7472	0.7781	0.7056
2005	0.7618	0.7568	0.7974	0.6880
For the month ended:
October 2009	0.9038	0.9067	0.9275	0.8656
September 2009	0.8824	0.8622	0.8824	0.8306
August 2009	0.8439	0.8353	0.8439	0.8201
July 2009	0.8339	0.8049	0.8339	0.7751
June 2009	0.8055	0.8025	0.8195	0.7851
May 2009	0.7993	0.7648	0.7993	0.7290

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Dividends

For fiscal 2009, an interim dividend of A$0.28 per share was determined by our Board of Directors, or Board, in February 2009 and was paid in April 2009. A final dividend of A$0.10 per share was determined by our Board in August 2009 and paid in October 2009.

The table below sets forth the amounts of interim, final and total dividends paid in respect of each fiscal year indicated.

Fiscal year ended	Interim	Final Special (in A$ per share)	Total
June 30, 2009	0.28	0.10 —	0.38
June 30, 2008	0.55	0.65 0.10	1.30
June 30, 2007	0.60	0.60 —	1.20
June 30, 2006	0.45	0.60 —	1.05
June 30, 2005	0.70	0.70 0.20	1.60

We presently expect to continue to pay dividends in the future. The total amounts of future dividends will be determined by our Board and will depend on our profit after tax, cash flow, financial and economic conditions and other factors. We have expressed an intention to maintain a dividend payout ratio of between 45% and 55% of profit after tax.

Cash dividends are paid in Australian dollars. Fluctuations in the exchange rate between the Australian dollar and U.S. dollar will affect the U.S. dollar amounts received by holders of Sims ADSs upon conversion of the dividends into U.S. dollars.

B. Capitalization and Indebtedness

Not applicable.

C. Reasons for the Offer and Use of Proceeds

Not applicable.

D. Risk Factors

Set forth below are risks that we believe may be material to our business operations. Additional risks and uncertainties that are presently unknown or deemed to be immaterial may also adversely affect our business operations.

The global financial crisis and recession in many parts of the world have adversely affected our earnings, liquidity and financial condition and are expected to continue to do so, until global economic conditions and scrap prices improve.

Global financial and credit markets have been extremely unstable and unpredictable and worldwide economic conditions have been weak. The instability of the credit markets and weakness of the global economy has adversely affected, and could continue to adversely affect, the demand for our customers’ products, the amount, timing and stability of their orders to us, the financial strength of our customers and suppliers, their ability or willingness to do business with us, our willingness to do business with them, our suppliers’ and customers’ ability to fulfill their obligations to us and the ability of our customers, our suppliers and us to obtain credit. These factors have adversely affected, and could continue to adversely affect, our operations, earnings and financial condition. This instability also could affect the prices at which we could make any such sales, which also could adversely affect our earnings and financial condition.

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The metal recycling industry has historically been, and is expected to remain, highly cyclical. A protracted fall in scrap metal prices, as occurred around the end of calendar 2008, would have a material adverse effect on our operating results. When inbound scrap flows are weak, which they are now, it reduces our ability to buy, process and sell scrap metals.

Scrap metal prices are volatile and the operating results of the metal recycling industry, in general, have historically been cyclical, and are expected to remain, highly cyclical in nature, and our operations, specifically, are expected to be highly cyclical in nature. After rising during 2007 and through the summer of 2008, scrap metal prices in global markets fell sharply beginning in the late summer of 2008 as a result of collapsing demand and the resulting excess supply in the industry. The fall in prices during this period adversely affected the results of scrap metal companies, including Sims, as a result of lower revenues and write-downs of inventories to net realizable value.

Scrap metal prices are sensitive to trends in cyclical industries, such as the automotive and construction industries. In the past, substantial price decreases during periods of economic weakness have not always been offset by commensurate price increases during periods of economic strength. Although scrap prices have stabilized to a large degree, the timing and extent of factors that will lead to a recovery to inbound flows of scrap cannot be predicted. Recovery of inbound volumes will likely depend on a broad recovery from the current global economic downturn, although the length and nature of business cycles affecting the scrap metal industry have historically been unpredictable. If the downturn in scrap metal prices were to be protracted, this would materially and adversely affect our revenues and profitability including through possible further write-downs of inventories.

See “Item 5—Operating and Financial Review and Prospects—Overview—Key Factors Affecting Results of Operations.”

Developments in the steel industry could have a material adverse impact on our operating results.

The scrap metal industry, and our business specifically, may also be adversely affected by increases in steel imports into the United States or other significant market regions, such as Australia, the United Kingdom and New Zealand, which may have an adverse impact on steel production in such market regions and a corresponding adverse impact on the demand for recycled metal from some of our facilities within such market regions. Additionally, the scrap metal industry, and our business specifically, could be negatively affected by changes in tariffs, or increased freight costs which could negatively impact export sales or attract imports of recycled metal or metal substitutes, which could, in turn, reduce demand for our recycled metal.

We are subject to significant risks relating to changes in commodity prices, currency exchange rates and interest rates, and may not be able to effectively protect against these risks.

We are exposed to commodity price risk during the period that we have title to products that are held in inventory for processing or resale. Prices of commodities, including recycled metals, can be volatile due to numerous factors beyond our control. In an increasing price environment for raw materials, competitive conditions may limit our ability to pass on price increases to our consumers. In a decreasing price environment for processed recycled metal, we may not have the ability to fully recoup the cost of raw materials that we procure, process and sell to our customers. New entrants into our markets could result in higher purchase prices for raw materials and lower margins from our recycled metal. We are unable to hedge positions in certain commodities, such as recycled ferrous metal, where no established futures market exists. Thus, our sales and inventory position will be vulnerable to adverse changes in commodity prices, which could materially adversely impact our operating and financial performance. We operate a global trading business that is involved in the purchase and sale of ferrous steel making raw materials without a corresponding sale or purchase. At any one time, this global trading business may have a material number of “open” or “at risk” trading positions. To the extent that markets move in an adverse direction and we have not hedged our position, this will have an adverse impact on profitability. From September 2008 to December 2008, there was a precipitous decline in commodity prices which required us to adjust our inventory to net realizable value. In fiscal 2009, we recorded inventory write-

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downs to net realizable value of approximately A$119 million. Additional provisions may be required in the future if commodity prices were to decline or if orders we intend to ship are cancelled or subject to renegotiation.

As a company that operates in many countries, we are also exposed to movements in currency exchange rates, the impact of which cannot be reliably predicted. We report our financial results in Australian dollars; however, we have significant assets, liabilities and earnings denominated in currencies other than Australian dollars, in particular U.S. dollars, British pounds and Euros. These assets, liabilities and earnings, therefore, are exposed to fluctuations in exchange rates between these currencies and the Australian dollar. Currency exchange rates have been extremely volatile in recent periods. In addition, all of our borrowings have variable interest rates. It may not be possible for us to effectively hedge against changes in interest rates at all or on an economically reasonable basis. Increases in interest rates could materially increase our borrowing costs and could have a material adverse effect on our results of operations and financial condition.

The unprecedented disruptions in the credit and equity markets worldwide in fiscal 2009 may impede or prevent our access to the capital markets for additional funding to expand or operate our business and may affect the availability or cost of borrowing under our existing or future credit facilities. Additionally, we believe the disruptions in the credit markets contributed to rapidly falling commodity prices in fiscal 2009, which have had an adverse impact on our revenues and results of operations.

The credit and equity markets of both mature and developing economies have experienced extraordinary volatility, asset erosion and uncertainty in the last twelve months, leading to governmental intervention in the banking and automobile manufacturing sectors in the U.S. and abroad on an unprecedented scale. Until these market disruptions that occurred in fiscal 2009 are overcome and markets normalize on a longer term and sustainable basis, we may not be able to access the capital markets, or to access them on acceptable terms, to obtain funding needed for expansion or operation of our business in furtherance of our strategic plan. In addition, changes in the capital or other legal requirements applicable to commercial lenders may affect the availability or increase the cost of borrowing under our credit facilities. If we are unable to obtain needed capital in this manner on terms acceptable to us, we may have to limit our growth initiatives or take other actions that could adversely affect our business, financial condition, results of operations and cash flows.

The loss of export sales could adversely affect our results of operations and financial condition.

A significant portion of our recycled metal sales is exported to markets outside of Australia, the U.S. and the United Kingdom, with significant sales to customers in China, Turkey, South Korea, Malaysia and other markets. If business opportunities in these markets were to decline significantly for any reason and alternative markets could not be found at comparable market prices, it would materially adversely affect our results of operations and financial condition. In fiscal 2009, the global financial crisis limited our customers’ ability to place orders for our products. Other risks associated with our export business include, among other factors, political and economic factors, economic conditions in the world’s economies, changes in legal and regulatory requirements, purchases or exports recycled metal, freight costs and customer collection risks. Any of these factors could result in lower export sales, which could have a material adverse effect on our results of operations and financial condition.

We are subject to competition from containerized recycled metal exports which negatively affects our port operations and marketing programs.

We generate a significant proportion of our earnings from the export of recycled metal. In 2007, there was a significant increase in the number of empty containers at ports in the United States, Australia, the United Kingdom and elsewhere. These containers were used for exporting materials at a relatively low cost because vessel operators provide lower freight costs to container shippers relative to bulk shippers. We are currently experiencing similar pressures from containerized recycled metal exports. Small recycled metal operators, principally in the United States, have taken advantage of this situation by exporting significant quantities of recycled metal in containers in competition with us. The increasing

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competition from containerized recycled metal exports may reduce our export gross margin on sales or volumes and, accordingly, may have a material adverse effect on our results of operations and financial condition.

The termination of material customer contracts could have a material adverse effect on our results of operations and financial condition.

We generally do not enter into long-term contracts with our customers. In addition, certain of our customers have in the past sought to terminate or modify their contracts on short notice without the payment of monetary penalties or incurring other penalties. The loss of significant customers, deterioration in the financial condition of significant customers, or the termination or modification of material customer contracts could have a material adverse effect on our results of operations and financial condition.

In fiscal 2009, we experienced a dramatic reduction in demand for both ferrous and non-ferrous scrap metal in part attributable to weakening economies and in some instances due to reactions by consumers to falling commodity prices. In some cases, we have had to renegotiate existing contracts due to the precipitous decline in commodity prices. In other cases, certain non-ferrous customers reneged on their contracts altogether, resulting in lost revenue of approximately A$36 million.

Potential credit losses from significant customers could adversely affect our results of operations and financial condition.

In connection with the sale of products (other than sales with letters of credit), we generally do not require collateral as security for customer receivables nor do we typically purchase credit insurance. We may have significant balances owing from customers that operate in cyclical industries and under leveraged conditions that may impair the collection of those receivables. We sell scrap metals to steel mills and other consumers which may have difficulty refinancing maturing obligations because of the conditions prevailing in the global credit markets. Failure to collect a significant portion of amounts due on those receivables could have a material adverse effect on our results of operations and financial condition.

We rely in part on lines of credit from commercial banks to finance our operations. Our results of operations and financial condition would be materially adversely affected if we were unable to continue to have access to bank financing on acceptable terms.

We currently maintain unsecured credit facilities provided by Commonwealth Bank of Australia, or CBA, Westpac Banking Corporation, or WBC, Bank of America, N.A., or BOA and certain other lenders. These credit facilities have maturity dates from 2010 through 2011. The lending relationships are generally long standing and typically have been extended in the ordinary course, but recognizing the recent and current circumstances of the global credit markets, no future assurance can be provided in this regard.

As of June 30, 2009, the total amount available under these facilities was approximately A$1.1 billion of which A$206.5 million (including guarantees) was outstanding, resulting in approximately A$856.5 million of additional borrowing availability under the facilities. At June 30, 2009, we also had cash balances of approximately A$69.5 million. If these banking institutions were to fail or to otherwise become unable or unwilling to satisfy their obligations to us under our credit agreements, then these events would be likely to have a material adverse effect on our results of operations and financial condition. Furthermore, the credit facilities contain customary events of default. The occurrence of an event of default under a credit facility could result in the termination of such credit facility by the relevant lender and, due to the existence of cross default provisions among our various lenders, could result in the termination of all of our credit facilities. Should these events occur, then they would be likely to have a material adverse effect on our results of operations and financial condition. We are also subject to certain financial covenants under the credit facilities which are measured on a bi-annual basis. If we are unable to comply with such covenants then such non-compliance would result in a deemed default under the facilities due to the aforementioned cross

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default provisions. Although we were in compliance with all of the financial covenants in our credit facilities as of June 30, 2009, based on current uncertainty arising from the global financial crisis and its related effects on commodity markets coupled with the ensuing economic conditions in the U.S. and United Kingdom, there can be no certainty or assurance given that we will be able to continue to comply with our financial or other obligations under the credit facilities.

All of our bank credit facility providers may either vary the terms of their facilities to their satisfaction, or with varying notice periods, give notice of termination of their facilities. There can be no assurance that our lenders will continue to provide us with financing on acceptable terms.

Given the continuing difficult financial market conditions caused by the global credit crisis, there can be no assurance that we will be able to extend or refinance our existing credit facilities when they mature. If we are able to extend or refinance our existing credit facilities, there can be no assurance that the financial and other terms of the new facilities will be comparable to the terms of our existing credit facilities or that the available terms will be acceptable to us. Our inability to extend or refinance our existing credit facilities at all, or on terms comparable to the terms of our existing credit facilities, could have a material adverse effect on our results of operations and financial condition.

As of June 30, 2009, A$870 million of our credit facilities are denominated in Australian dollars. We use these credit facilities periodically to fund our operations in the United States and Europe. If the Australian dollar were to weaken significantly against the U.S. dollar, the Euro or the British pound, then there would be a reduction in the amount of U.S. dollar, Euro and British pound borrowings that could be made available from the Australian credit facilities. This would in turn adversely impact our ability to fund our U.S. and European operations.

The profitability of our metal recycling operations depends, in part, on the availability of an adequate source of supply.

We procure our recyclable metal inventory from numerous sources. These suppliers generally are not bound by long-term contracts and have no obligation to sell recyclable metal to us. In periods of low industry prices, suppliers may elect to hold recyclable metal to wait for higher prices or intentionally slow their metal collection activities. If a substantial number of suppliers cease selling recyclable metal to us, we will be unable to recycle metal at desired levels and our results of operations and financial condition could be materially adversely affected. In addition, a slowdown of industrial production in the United States or certain other countries, as has recently occurred, reduces the supply of industrial grades of metal to the metal recycling industry, resulting in us having less recyclable metal available to process and market.

A significant increase in the use of substitute materials by consumers of processed recycled ferrous metal could reduce demand for our products.

During periods of high demand, tightness can develop in the available supply of recycled ferrous metal. The relative scarcity of recycled ferrous metal, particularly prime or industrial grades, during such periods, provides opportunities for producers of substitute products, such as pig iron and direct reduced iron pellets. It cannot be assured that the use of substitutes to recycled ferrous metal will not proliferate in the future if the prices for recycled metal rise or if the supply of available unprepared ferrous metal tightens. A number of third parties around the world are working on ways to produce recycled ferrous metal substitutes. If these efforts prove successful, they could become significant competitors and could adversely impact our results of operations and financial condition.

Our operations are subject to extensive governmental regulation in each of the jurisdictions in which we operate.

In each of the jurisdictions in which we operate, we are subject to a variety of laws and regulations relating to trade, competition, taxes, employees and employee benefits, worker health and safety, land use, the environment, international trade, and other matters. We may be required to make significant expenditures and to devote substantial management time and attention in order to operate our

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business in compliance with such laws and regulations. In addition, changes in these laws or regulations or their interpretations or enforcement may require us to make significant additional expenditures or to change our business practices. If we fail to comply with applicable laws and regulations, we could incur criminal or civil fines, penalties, assessments or other damages, which could be substantial and could have material restrictions or limitations placed on our business operations. In certain cases, governmental compliance actions may also give rise to potential claims for damages by private parties. Furthermore, we are dependent on international markets for shipping scrap and if laws or regulations were to prohibit or limit our ability to ship between continents, there could be an adverse impact to our results of operations and financial condition.

Our operations are subject to stringent environmental laws and regulations.

We are subject to comprehensive statutory and regulatory environmental requirements relating to, among others:

• the acceptance, storage, treatment, handling and disposal of solid, hazardous and toxic waste;

• the discharge of materials into the air;

• the management and treatment of wastewater and storm water;

• the remediation of soil and groundwater contamination; and

• the protection of employee health and safety.

The nature of our business, and previous operations by others at facilities currently or formerly owned or operated or otherwise used by us, exposes us to risks of claims under environmental laws and regulations, especially for the remediation of soil or groundwater contamination. We may be required to make material expenditures for remedial activities or capital improvements with regard to sites currently or formerly owned or operated or otherwise used by us.

Environmental statutes and regulations have changed rapidly in recent years by requiring greater and more expensive protective measures. Thus, it is possible that we will be subject to even more stringent environmental standards in the future. For example, in many jurisdictions in which we operate, there is the potential for regulation and or legislation relating to mercury contaminants. Automobile hulks that are purchased and processed by us may contain mercury switches. Legislation or regulations that may be enacted in the future cannot be presently known and neither can the effects, if any, that any such law or regulation could have on our business. For these reasons and others, the future capital expenditures for pollution control equipment, remediation or other initiatives that may be required cannot be predicted with accuracy. However, it is generally expected that environmental standards will become increasingly more stringent and that the expenditures necessary to comply with those heightened standards will correspondingly increase.

We are required to maintain, and to comply with, various permits and licenses to conduct our operations. Failure to maintain, or violations of, any permit or license, if not remedied, could result in us incurring substantial fines, suspension of operations or closure of a site. Further, our operations are conducted primarily outdoors and, as such, depending on the nature of the ground cover, such outdoor operations will involve the risk of releases of wastes and other regulated materials to the soil and possibly to groundwater. As part of our continuous improvement programs, we expect to incur costs to improve environmental control systems.

Because companies in the metal recycling industry have the potential for discharging wastes or other regulated materials into the environment, in any given year, a significant portion of our capital expenditures could be related, directly or indirectly, to pollution control or environmental remediation.

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Regulation of greenhouse gas emissions and climate change issues may adversely affect our operations and markets.

A number of governments or governmental bodies have introduced or are contemplating regulatory changes in response to the potential impacts of climate change. International treaties or agreements may also result in increasing regulation of greenhouse gas emissions, including the introduction of carbon emissions trading mechanisms, in jurisdictions in which we operate. Any such regulation will likely result in increased future energy and compliance costs. From a medium and long-term perspective, we are likely to see an increase in costs relating to our assets that emit significant amounts of greenhouse gases as a result of these regulatory initiatives. These regulatory initiatives will be either voluntary or mandatory and may impact our operations directly or through our suppliers or customers. Assessments of the potential impact of future climate change regulation are uncertain, given the wide scope of potential regulatory change in countries in which we operate.

The potential physical impacts of climate change on our operations are highly uncertain, and would be particular to the geographic circumstances. These effects may adversely impact the cost, production and financial performance of our operations.

Our operations generate waste that is required to be treated, stored and disposed of in accordance with applicable environmental laws.

Our metal recycling operations produce significant amounts of waste that we are required to pay to have treated or discarded. For example, we operate shredders for which the primary feedstock is automobile hulks and obsolete household appliances. Approximately 20% of the weight of an automobile hulk consists of non-metallic material, commonly referred to as shredder fluff or automobile shredder residue, or ASR, which constitutes the remnant material after the separation of saleable ferrous and non-ferrous metals. Environmental regulations in countries in which we operate require us to test ASR to determine if it is to be classified as hazardous waste before disposing of it off-site in permitted landfills. Our other waste streams in the United States and other countries in which we operate are subject to similar requirements. Additionally, we employ significant source control programs to ensure, to the fullest extent possible, that prohibited hazardous materials do not enter our raw materials stream. However, we cannot be assured that such materials will be successfully removed from our source streams and resultant recycling by-products. As a result, our waste streams may, from time to time, be classified as a hazardous waste in which case we may incur higher costs for disposal of these waste products.

Environmental assessments, conducted by independent environmental consulting firms, of certain of our operating sites have revealed that some soil impacts, potentially including impacts associated with various metals, petrochemical by-products, waste oils, polychlorinated biphenyls, which are referred to as PCBs, and volatile organic compounds are, or may be, present at varying levels. It is likely that such impacts at varying levels may exist at some of the sites and it is expected that some of these sites could require investigation, monitoring and remediation in the future. The costs of such remediation could be significant. The existence of such impacts at some of our facilities potentially could require us to incur significant costs to remediate and could materially adversely affect our ability to sell those properties.

We may have potential environmental investigation and cleanup liabilities.

Certain of our U.S. subsidiaries have received notices from the United States Environmental Protection Agency, or USEPA, U.S. state agencies or third parties that they have been identified as potentially responsible for the cost of investigation and cleanup of landfills or other sites where the subsidiary’s material was shipped. In most cases, many other parties are also named as potentially responsible parties. The Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, enables USEPA and other United States’ regulatory agencies to recover from owners, operators, generators and transporters the cost of investigation and cleanup of sites which pose serious threats to the environment or public health. In certain circumstances, a potentially responsible party may

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be held jointly and severally liable for the cost of cleanup. In other cases, a party who is liable may only be liable for a divisible share. Liability may be imposed even if the party shipped materials in a lawful manner at the time of shipment. Liability for investigation and cleanup costs can be significant, particularly in cases where joint and several liability may be imposed. CERCLA, including the Superfund Recycling Equity Act of 1999, limits the exposure of metals recyclers for sales of certain recyclable material under certain circumstances. However, the recycling defense is subject to conducting reasonable care evaluations of current and potential consumers. Because CERCLA can be imposed retroactively on shipments that occurred many years ago, and because USEPA and state agencies are still discovering sites that present problems to public health or the environment, we cannot be assured that we will not become liable in the future for significant costs associated with investigation and remediation of CERCLA waste sites.

We do not have environmental impairment insurance, except in limited amounts for specific circumstances.

In general, because we believe that the cost of the premiums outweighs the benefit of coverage, we do not carry environmental impairment liability insurance. If we were to incur significant liability for environmental damage, such as a claim for soil or groundwater remediation, our results of operations and financial condition could be materially adversely affected.

Our operations present risk of injury or death.

Because of the heavy industrial activities that are conducted at our facilities, there exists a risk of serious injury or death to our employees or other visitors to our operations, notwithstanding the safety precautions that are taken. Our operations are subject to regulation by governmental agencies responsible for employee health and safety. We currently have in place policies and workplace strategies to minimize this risk to employees and other visitors to our facilities and, accordingly, to minimize the risk that we will incur government fines for violations of such regulations. We may, nevertheless, be unable to avoid material liabilities for any death or injury that may occur in the future and these types of incidents may have a material adverse effect on our results of operations and financial condition.

The loss of any member of our senior management team or a significant number of our managers could have a material adverse effect on our results of operations and financial condition.

Our operations depend heavily on the skills and efforts of our senior management team. In addition, we rely substantially on the experience of the management of our businesses with regard to day-to-day operations. While we have employment agreements with certain of our senior management team, we may be unable to retain the services of any of those individuals. The loss of any member of our senior management team or a significant number of managers could have a material adverse effect on our results of operations and financial condition.

We may not be able to negotiate future labor contracts on favorable terms.

Many of our employees are represented by various labor unions. As the agreements with those unions expire, we may not be able to negotiate extensions or replacements of them on terms favorable to us, or at all, or avoid strikes, lockouts or other labor actions from time to time. Therefore, as labor contracts expire, we cannot be assured that new labor agreements will be reached with our unions or on terms that we find acceptable. Any labor action resulting from the failure to reach an agreement with our unions could have an adverse effect on our results of operations and financial condition.

Losses relating to our pension plans and a decline in returns on our plan assets may negatively affect our results of operations and financial condition.

The fair value of our pension plan assets has declined and our investment return has decreased under the current market circumstances. If the fair value of our pension plan assets decline or our investment return decreases further, or if there is a change in the actuarial assumptions on which the calculations of the projected pension obligations or pension plan assets are based, such as a decline in the

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discount rate or the expected rate of return on plan assets, we may incur additional losses. Changes in the interest rate environment and other factors may also adversely affect the amount of unfunded pension obligations. In addition, we contribute to various multi-employer pension plans which cover employees under collective bargaining agreements. The required contributions are specified in such collective bargaining agreements. However, we may be required to fund additional amounts in the future if one or more of these multi-employer plans do not meet regulatory funding guidelines.

If the goodwill or other identifiable intangible assets recorded in connection with our recent acquisitions becomes impaired, we may be required to record impairment charges, which may adversely affect our financial results, the price of our securities and our ability to pay dividends.

In accordance with IFRS, we have accounted for our acquisitions using the purchase method of accounting. We recorded the excess of the purchase price over the fair value of the assets and liabilities of the acquired companies as goodwill. IFRS requires us to test goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. Impairment is determined by assessing the recoverable amount of the cash-generating unit or CGU, to which the goodwill relates. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.

In fiscal 2009, the global financial crisis and recession led to the decline in our market capitalization and negatively affected the fair value of our CGUs for purposes of our periodic testing of goodwill for impairment. As a result, we recorded A$191.1 million of goodwill impairment charges in fiscal 2009. As of June 30, 2009, the balance of goodwill and other identifiable intangible assets was A$1.1 billion and A$238.8 million, respectively.

The metal recycling industry is highly cyclical and therefore is more likely than other less cyclical companies in other industries to incur impairment losses due to variability in our earnings and cash flows. We may be required to record additional impairment charges relating to goodwill in future periods if the fair value of any of our CGUs declines below the fair value of related assets net of liabilities. Any additional impairment charges will negatively affect our results of operations and capitalization and could have a material adverse effect on our ability to pay dividends.

Prior to our merger with Metal Management, Sims was not subject to Securities and Exchange Commission rules. We have incurred, and will continue to incur, significant expenditures and investment of senior management’s time with respect to our internal controls to ensure compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002.

Section 404 of the Sarbanes-Oxley Act of 2002, or SOX 404, and the regulations of the Securities and Exchange Commission, or SEC, thereunder require our senior executives and senior financial officers to assess the effectiveness of our internal controls over financial reporting on an annual basis. Fiscal 2009 was the first year that we were required to comply with SOX 404. We incurred professional fees of approximately A$9.7 million in fiscal 2009 to comply with the requirements of SOX 404. We will continue to incur additional expenditures in future periods to ensure compliance with SOX 404.

Material weaknesses in our internal control over financial reporting could result in the inability of investors to rely on our financial statements, which could result in an adverse effect on the perceived value of the company and, thus, a reduction in our stock price. Management is responsible for establishing and maintaining adequate internal control over financial reporting. As discussed below under “Item 15. Controls and Procedures,” there were two material weaknesses identified in fiscal 2008 which were remediated in fiscal 2009. There were no material weaknesses in fiscal 2009. If material weaknesses are identified in future periods, our shareholders may face additional risks. The existence of material weaknesses could impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis and result in the loss of investor confidence in the reliability of our financial statements. As a result, our business, financial condition, results of operations

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and prospects, as well as the trading price of our ordinary shares and ADSs, could be materially and adversely affected.

If we were to lose our foreign private issuer status under U.S. federal securities laws, we would likely incur additional expenses associated with compliance with the U.S. securities laws applicable to U.S. domestic issuers.

We are a foreign private issuer, as such term is defined in Rule 405 under the Securities Act, and, therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, applicable to U.S. domestic issuers. In order to maintain this status, a majority of our ordinary shares, including ordinary shares underlying our ADSs, must be either directly or indirectly owned of record by non-residents of the United States as we do not currently satisfy any of the additional requirements necessary to preserve this status. Currently, we believe that a majority of our ordinary shares are held by non-residents of the United States. If we lost this status, we would be required to comply with the Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. We may also be required to make changes in our corporate governance practices in accordance with various SEC, and New York Stock Exchange, or the NYSE, rules. The regulatory and compliance costs to us under U.S. securities laws if we are required to comply with the reporting requirements applicable to a U.S. domestic issuer may be significantly higher than the cost we would incur as a foreign private issuer.

We are exposed to the risk of legal claims and other liabilities that may have a material adverse effect on our results of operations and financial condition.

We are exposed to the risk of legal claims and other liabilities arising in connection with the operation of our business that may have a material adverse effect on our results of operations and financial condition. These claims and liabilities may include (i) claims by employees or former employees relating to personal injury, compensation or employment law violations; (ii) environmental, land use and other claims arising out of the ownership or operation of facilities; and (iii) disputes with customers, suppliers and other business relations. The nature of our business may make us more likely than some other companies to be exposed to the risk of legal claims and other liabilities. In particular, metal recycling companies are generally exposed to higher risks of environmental claims and liabilities than companies in non-manufacturing industries, and employees working in the metal recycling industry may be more likely to suffer workplace injuries than employees of companies in other industries. The resolution of these claims and other liabilities may require us to pay material damages or other costs to third parties, including potentially punitive, exemplary or other special damages. The resolution of claims may also involve an extensive commitment of senior management’s time and attention, and may require changes in our business practices resulting in decreased revenues or profits or additional costs. Even if claims or other liabilities are resolved successfully, we may incur significant legal and other expenses in defending against such matters.

Our tax liabilities may substantially increase if the tax laws and regulations in the countries in which we operate change or become subject to adverse interpretations or inconsistent enforcement.

Taxes payable by companies in many of the countries in which we operate are substantial and include value added tax, excise duties, taxes on income (including profits and capital gains), payroll related taxes, property taxes and other taxes. Tax laws and regulations in some of these countries may be subject to frequent change, varying interpretation and inconsistent enforcement. In addition, many of the jurisdictions in which we operate have adopted transfer pricing legislation. If tax authorities impose significant additional tax liabilities as a result of transfer pricing adjustments, it could have a material adverse effect on our results of operations and financial condition. It is possible that taxing authorities in the countries in which we operate will introduce additional revenue raising measures. The introduction of any such provisions may affect our overall tax efficiency and could result in significant additional taxes becoming payable. Any such additional tax exposure could have a material adverse effect on our results of operations and financial condition. We may face a significant increase in income taxes if tax rates

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increase or the tax laws or regulations in the jurisdictions in which we operate or treaties between those jurisdictions are modified in an adverse manner. This may adversely affect our cash flows, liquidity and ability to pay dividends.

Our operations are subject to risks and uncertainties relating to international conflicts and terrorism.

Due to the extensive diversification of our international operations and significant presence on ports, we are subject to a higher level of risk than some other companies relating to international conflicts, wars, internal civil unrest, trade embargoes and acts of terrorism. Our international operations include sales in developing countries, which may be more likely than developed countries to be affected by international conflicts and terrorism. Risks of this type may affect facilities owned or operated by us or facilities of our suppliers or customers. In addition, risks of this type may affect port facilities or other transportation infrastructure owned or used by us in the operation of our business. In circumstances implicated by international conflicts, there could be severe limitations imposed on intercontinental shipments of materials which could have a material adverse effect on our results of operations and financial condition.

Our largest shareholder has significant influence over transactions requiring shareholder approval.

Mitsui Raw Materials Development Pty Limited holds approximately 19% of the outstanding ordinary shares of Sims and is our largest shareholder. Under our constitution, Mitsui & Co., Ltd and any of its related corporate bodies, which are collectively referred to as Mitsui, have the right to designate a representative director to serve on our Board so long as Mitsui holds 5% or more of Sims ordinary shares and, so long as Mitsui holds 15% or more of Sims ordinary shares, then Mitsui has the right to designate both a representative director and an independent director to serve on our Board. Mitsui may have interests with respect to its investment in Sims that are different from, or in addition to, the interests of other holders of Sims ordinary shares or Sims ADSs. The extent of Mitsui’s shareholding in Sims could also have the effect of discouraging offers to acquire control of Sims and may preclude holders of Sims ordinary shares or Sims ADSs from receiving any premium above the market price for their shares that may be offered in connection with any attempt to acquire control of Sims.

Item 4. Information on the Company

A. History and development of the company

We are an Australian domiciled corporation that is incorporated in the State of Victoria, Australia, and we operate under the Corporations Act. Our principal place of business is located at 110 Fifth Avenue, Suite 700, New York, NY 10011 and the telephone number is (212) 604-0710.

Sims was originally established in 1917 by Albert Sims, a Sydney-based recycled metals dealer. The business was incorporated as Albert G. Sims Limited in 1928 and was renamed Simsmetal Limited in 1968. In 1970, it merged with Consolidated Metal Products Limited and the merged Australian Securities Exchange, or ASX, listed company was named Sims Consolidated Limited. In 1979, Sims Consolidated Limited was acquired by Peko-Wallsend Limited and subsequently delisted. Sims Consolidated Limited was then acquired by North Limited (previously known as North Broken Hill Holdings Limited, and then North Broken Hill Peko Limited) in 1988. In 1989, North Limited sold the business to Elders Resources NZFP Limited, a diversified resources company. In 1990, Carter Holt Harvey Limited made a successful takeover bid for Elders Resources NZFP Limited and divested that company’s non-forestry businesses, which included Sims. Sims changed its name to Simsmetal Limited in 1990 and relisted on the ASX in 1991. Simsmetal Limited changed its name to Sims Group Limited in 2003. At our annual general meeting on November 21, 2008, shareholders approved the change in our corporate name to Sims Metal Management Limited.

Our corporate strategy is to grow and develop our core metal recycling business internationally, but particularly in North America and the United Kingdom, and our emerging innovative recycling

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solutions business to collectively create the world’s leading recycling company. Key elements include the pursuit of external growth opportunities and continued investment in existing operations.

We have established a long-term track record of expanding our operational and sourcing footprint through both acquisitions and strategic alliances. We believe that our acquisition of Metal Management completed in March 2008 established us as the largest metals recycling operation within North America.

Based on our experience gained from numerous international acquisitions, we have established strict acquisition criteria. The acquisition criteria require that any acquisition target (i) holds a leading market position; (ii) delivers access to domestic and international customers; (iii) offers a sound platform for future growth; (iv) has a similar culture, including a strong emphasis on integrity, environmental compliance and a commitment to worker safety; and, (v) is able to enhance shareholder value. The acquisition criteria have underpinned our strong track record of international expansion.

On March 14, 2008, we merged with Metal Management. Metal Management was one of the largest full service scrap metal recyclers in the United States with locations in 17 U.S. states. The acquisition was consummated to strengthen our position in the North American scrap recycling market and expand our presence in non-ferrous products. The acquisition was complementary as our operations in North America were primarily export-focused while Metal Management’s operations were primarily domestic-focused and included a large non-ferrous recycling business. Other recent scrap metal acquisitions and joint ventures include:

• October 2005, we merged with entities operating certain of the recycling businesses of Hugo Neu Corporation, or Hugo Neu, in the United States;

• December 2006, we acquired Cymru Metals Recycling in the United Kingdom;

• January 2007, we acquired the operating assets of Menzies Metals Recycling in Australia;

• August 2007, we acquired the operating assets of McInerney Metals in Australia;

• September 2007, we were a party to the creation of a joint venture with Adams Steel LLC in the United States, named SA Recycling;

• October 2007, we acquired the operating assets of ER Coley (Steel) in the United Kingdom;

• May 2008, SA Recycling acquired Pacific Coast Recycling, LLC in the United States;

• June 2008, we acquired the operating assets of Evans and Mondon Limited in the United Kingdom;

• September 2008, SA Recycling acquired a 70% interest in Silver Dollar Recycling in the United States;

• September 2008, we acquired the operating assets of Weinert Recycling in the United States;

• February 2009, we acquired the operating assets of All Metal Recovery Limited in the United Kingdom; and

• July 2009, we acquired the operating assets of Fairless Iron & Metal, LLC in the United States.

Sims Recycling Solutions, our innovative recycling solutions business which includes electronic product de-manufacturing and processing operations, which is referred to as e-recycling, was launched with the construction of an end-of-life refrigerator recycling plant in the United Kingdom in 2002. Since then, the business has expanded with the acquisitions of:

• October 2004, we acquired the Mirec Group, or Mirec, in The Netherlands;

• October 2006, we acquired Metall + Recycling, or M&R, in Germany;

• February 2007, we acquired United Recycling Industries, or URI in the United States;

• April 2007, we acquired the e-recycling assets of Noranda Recycling, or Noranda, in the United States;

• November 2007, we acquired Trishyiraya Recycling Private Limited, or Trishyiraya in India;

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• January 2008, we acquired the operating assets of RecommIT Limited, or RecommIT, in the United Kingdom;

• January 2008, we acquired Accu-Shred Limited in Canada;

• April 2008, we acquired Life Cycle Services, or LCS, in the United Kingdom;

• June 2008, we acquired the operating assets of Clearhouse Technology Pty Ltd, or Clearhouse, in Australia;

• October 2008, we acquired Global Investment Recovery, Inc, or GIR, in the United States; and

• May 2009, we acquired the operating assets of Global Environment Recycling Co. Limited.

We have also expanded and enhanced our operations through capital expenditures. Our capital expenditures for fiscal 2009, 2008 and 2007 were A$187.5 million, A$129.7 million and A$90.5 million, respectively. We have obligations under contracts relating to capital expenditures. Estimated amounts remaining to be executed on such contracts totaled approximately A$34.7 million at June 30, 2009.

In fiscal 2009, we embarked on two important capital projects in North America. As described further in “Item 4.B. Business Overview,” we signed a long-term contract with the Department of Sanitation of New York City. In connection with this contract, we are constructing a material recycling facility in Brooklyn, New York and making additional improvements to our existing facilities in New York and New Jersey. We budgeted capital expenditures totaling US$82.7 million for this project of which US$3 million was spent in fiscal 2009. We expect to spend approximately US$22.0 million in fiscal 2010. We are also completing facility improvements at our shredding facilities in New Jersey and Connecticut whereby we have licensed technology which will enable us to recover incremental copper and other non-ferrous material from auto-shredder processed material that is currently being sent to landfills. The total cost of this project is approximately US$49.0 million of which US$29.0 million was spent in fiscal 2009. We expect to spend approximately US$18.0 million in fiscal 2010 to complete this project. We expect to finance these capital projects from our cash flow from operations and borrowings under our credit facilities.

In fiscal 2009, we completed the construction of a state-of-the-art waste from electrical and electronic equipment, or WEEE, facility in Newport, United Kingdom at a cost of £13 million. The facility is the world’s first and fully integrated completely closed loop recycling facility offering reuse, resale, recycling of all commodities contained within post consumer products from metals to plastics. It occupies 50,000 square meters and is expected to recycle over 100,000 tons of material annually.

Globally, we have approximately 93 subsidiaries as well as interests in several joint ventures. For a list of our wholly-owned and indirectly owned subsidiaries, see Exhibit 8.1 filed hereto.

B. Business overview

We believe we are one of the world’s largest metals recycling companies on the basis of our market capitalization and the size and scope of our operations. We operate a geographically diverse metals recycling business with a network of processing facilities, many with deep-water port access, supported by an extensive network of feeder yards from which to source recyclable ferrous and non-ferrous metals. We have significant positions in the metals recycling markets of Australasia, the United States, and the United Kingdom. We also have a strategic network of trading offices in Asia. Through our Sims Recycling Solutions business, we have an emerging global e-recycling business, with established operations in the United Kingdom, Continental Europe and North America and a developing presence in the Asia Pacific region.

We are domiciled in Australia, however over 94% of our revenue in fiscal 2009 was derived from operations outside Australia, including approximately 74% derived from North America. Our business consists of Metal Recycling, Sims Recycling Solutions and several other smaller businesses. The Metal Recycling business collects and processes ferrous and non-ferrous metals for sale to customers in

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domestic and international markets. The Sims Recycling Solutions business collects and processes post-consumer products such as televisions, radios, computers and other electronic and electrical consumer goods. Sims also operates, or has interests in, other businesses, including manufacturing and renewable energy businesses. As part of our post-merger strategy, we divested our steel distribution and tire recycling businesses in Australia on June 30, 2008 and 2009, respectively.

We are principally organized geographically and then by line of business. While our Group Chief Executive Officer evaluates results in a number of different ways, the geographical areas of operation is the primary basis for which the allocation of resources and financial results are assessed. The major geographic areas of operations are as follows:

• North America — comprising the United States of America and Canada.

• Australasia — comprising Australia, New Zealand, Papua New Guinea and Asia.

• Europe — comprising United Kingdom, Sweden, Netherlands and Germany.

We also report revenues by the following product groups:

• Ferrous secondary recycling — comprising the collection, processing and trading of iron and steel secondary raw material.

• Non-ferrous secondary recycling — comprising the collection, processing and trading of other metal alloys and residues, principally aluminum, lead, copper, zinc and nickel bearing materials.

• Secondary processing — comprising value added process involving the melting, refining and ingoting of certain non-ferrous metals and the reclamation and reprocessing of plastics.

• Recycling solutions — comprising the provision of environmentally responsible solutions for the disposal of post consumer electronic products, including IT assets recycled for commercial customers. The Company offers fee for service business opportunities in the environmentally responsible recycling of negative value materials including refrigerators, electrical and electronic equipment.

• The following table sets forth our sales by geography and product group for the past three years.

(in thousands)					Fiscal years ended June 30,	Fiscal years ended June 30,
		2009 A$	%		2008 A$	%		2007 A$	%
Net sales by geography:
Australasia		1,158,619	13%		1,745,109	23%		1,465,384	26%
North America		6,368,489	74 %		4,607,898	60 %		2,938,245	53 %
Europe		1,109,117	13%		1,312,584	17%		1,144,891	21%
Net sales		8,636,225	100 %		7,665,591	100 %		5,548,520	100 %
Net sales by product group:
Ferrous metals		6,642,694	77 %		5,421,102	71 %		3,587,925	64 %
Non-ferrous metals		1,193,397	14%		1,324,123	17%		1,264,402	23%
Secondary processing		221,624	2 %		361,159	5 %		262,347	5 %
Recycling solutions		578,510	7%		559,207	7%		433,846	8%
Net sales		8,636,225	100 %		7,665,591	100 %		5,548,520	100 %

Metal Recycling

Industry Overview

Recycled ferrous (steel and iron) scrap is one of the primary metallics utilized in the steelmaking production process. Other primary metallics include pig iron and steel scrap substitutes (i.e. directly

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reduced iron). Recycled ferrous scrap is the predominant feedstock for Electric-Arc-Furnace, or EAF, based steel production.

In 2008, according to the World Steel Association, or WSA, 1.323 billion tons of steel was produced globally, representing a 28.6 million ton decrease from the 2007 production level of 1.351 billion tons. China has increased steel production significantly in recent years (principally using the basic oxygen furnace steel production method) representing 38% of global steel production for 2008. According to the WSA, EAF-based steel production was 405 million tons in 2008 and represented approximately 31% of total global steel production, which is a 43% increase on volumes in 2000 of 283 million tons. Approximately, 476 million tons of recycled steel was consumed in steel production in 2008.

Globally, recycled metals are predominantly sourced among developed industrial regions which include North America, the European Union, Australia and Japan where greater amounts of recyclable industrial and obsolete metals exist. The two most significant regions for global recycled metals are North America and the European Union and in both regions we have significant presence.

Both ferrous and non-ferrous metals are either consumed domestically in their country of origin or traded in the export market. Given the lower price to weight ratio of ferrous recycled metals, the market for unprocessed ferrous scrap is primarily a local or regional market. The predominant importers of recycled metals are developing regions and countries. The most significant importers are Turkey, China, Korea, Taiwan, Malaysia, Indonesia and Mexico.

Our Metal Recycling Operations

Our Metals Recycling operations encompass buying, processing and selling of ferrous and non-ferrous recycled metals. We are a geographically diverse metals recycler with a network of processing facilities, many with deep-water port access, supported by an extensive network of feeder yards from which we source recyclable ferrous and non-ferrous metals. The Metal Recycling business has operations in six countries, including the United States, Australia and the United Kingdom.

We buy ferrous metal from metal dealers, peddlers, auto wreckers, demolition firms and others who generate obsolete metal and from manufacturers who generate industrial metal. We process ferrous metal for resale using a variety of methods, including sorting, shredding, cutting, torching, baling or breaking. After processing, ferrous recycled metal is sold to end users such as electric arc furnace mills, integrated steel mills, foundries and brokers.

We source non-ferrous metals from manufacturers, known as production offcuts, and from generators of electricity, telecommunication service providers and others who generate obsolete metal. Peddlers and metal dealers, who collect from a variety of sources, also deliver material directly to our facilities. In addition, we generate significant quantities of non-ferrous metal as a by-product, which is referred to as NFSR, Zorba or mixed metals, from our ferrous shredding operations. We report such sales as ferrous sales.

North America

We believe we are one of the largest metal recyclers in North America. Our North American metals recycling business, including our 50% interest in SA Recycling LLC, consists of over 100 physical operations located in 21 U.S. states and British Columbia, Canada. Our geographic diversity and deep water port access on both the U.S. east and west coasts provides operational flexibility and enables us to divert sales, when deemed appropriate, between export and domestic markets to maximize profitability. Other operational benefits include: reduced exposure to regional issues; flexibility of ports of origin to minimize freight movements; and reduced risks of berthing delays often experienced by users of unaffiliated terminal facilities.

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Australasia

We believe we are one of the largest metals recyclers in the southern hemisphere, with 36 metal recycling operations in Australia, 10 metal recycling operations in New Zealand and 3 metal recycling operations in Papua New Guinea.

Europe

We believe we are one of the largest metals recyclers in the United Kingdom. We recover and process recycled ferrous metal through 54 physical operations strategically located to serve domestic customers and export markets. Satellite feeder yard operations, extending throughout England and Wales, facilitate the supply of metal through to our larger processing facilities. Most of our main facilities are accredited under the ISO 9001 Quality Assurance system. Our non-ferrous operations are integrated with many of the ferrous metal sites throughout the United Kingdom, offering comprehensive service to suppliers.

Marketing

Our export and import marketing activities are conducted through our international businesses, being Sims Metal Management Asia Limited, based in Hong Kong, which markets non-ferrous metals, and Sims Global Trade Corporation, based in New York, which markets ferrous metals. These activities consist of teams of traders and exclusive agents, marketing and brokering recycled ferrous, non-ferrous metals and alternative steel making raw materials on behalf of Sims and third parties.

Sims Metal Management Asia Limited, through its network of offices in Hong Kong, Malaysia, Vietnam and India, and Sims Global Trade Corporation manage relationships with a large percentage of our overseas client base in over 20 countries in various regions, including Asia, Eastern Europe and South America. The international businesses are also involved in the global trading of numerous metal-related commodities and provide a service to our customer base through their market and product knowledge, financial strength and expertise in shipping and banking.

Sims Recycling Solutions

Sims Recycling Solutions, or SRS, is an emerging global e-recycling business, with established operations in the United Kingdom, Continental Europe and North America and a developing presence in the Asia Pacific region. The Sims Recycling Solutions business handles in excess of 500,000 tons of electronic and electrical material each year, much of it under contract with waste management companies, local authorities and original equipment manufacturers.

North America

In August 2003, we opened our first e-recycling facility in North America in Hayward, California. This facility processes both business-tobusiness products on behalf of major information technology clients and obsolete products arising as a consequence of California’s e-recycling legislation. This legislation, in particular the fact that it bans cathode ray tube disposal in landfills, combined with the infrastructure acquired in Los Angeles through the Hugo Neu merger, offers the potential for e-recycling facilities in southern California, which would expand upon our presence in northern California. Potential e-recycling legislation in New York and recently enacted legislation in New Jersey is also expected to provide a suitable environment for us to operate.

The acquisitions of URI and Noranda in fiscal 2008 expanded our presence in North America. URI, based in West Chicago, Illinois, is a fully integrated e-recycler offering a range of services including the collection, refurbishment and re-sale of working equipment, parts recovery for re-sale, mechanized testing and processing of monitors, mechanical recycling of e-waste and secondary smelting and refining of high grade electronics by-product materials. The Noranda acquisition consisted of the end-of-life recycling assets of Xstrata Copper Canada’s e-recycling business in Roseville, California; Brampton, Canada; and LaVergne, Tennessee.

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Our acquisition of GIR in fiscal 2009 increased our North American e-recycling and asset recovery market presence by approximately 40%, consolidating our market leading position. GIR is a leading U.S. e-recycler and asset recovery specialist based in Tampa, Florida. GIR is a multi-state service provider, with operating facilities in Florida, South Carolina, Nevada, Louisiana and Arizona.

We also recycle post-consumer materials through a 20 year recycling contract with the New York City Department of Sanitation. This contract became effective in January 2009. Under this contract, we handle plastic, glass and metal and, in the future, will handle paper as well. Packer trucks owned and operated by New York City deliver recyclables to our facilities as a commingled product which are then processed using a series of screens, magnets, eddy currents, optical sorters and conveyors. The recyclables are separated and sorted into ferrous and nonferrous metals, different plastic resins, glass and residue. The recycled materials are shipped to U.S. and non-U.S. markets.

Europe

We operate one of the United Kingdom’s largest and most sophisticated refrigerator recycling facilities using leading technology to fragment domestic and commercial fridges within an enclosed environment. The purpose of this process is to safely remove ozone depleting substances for destruction. The remaining materials are separated mechanically into product streams including steel, non-ferrous metals, plastics and foam. These products are then marketed in the recycled materials market.

Under European Union Directive 2002/96/EC on Waste Electrical and Electronic Equipment, or the WEEE Directive, producers of WEEE are obliged to meet the costs of recovery and recycling of WEEE. Servicing the needs of the WEEE manufacturing industry and local authorities in processing WEEE in an effective, environmentally sound and legally compliant manner is expected to be a growth opportunity for the SRS business. Each of the 15 original members of the European Union has formally adopted the WEEE Directive.

We have made a number of European e-recycling acquisitions, including Mirec, M+R, RecommIT and LCS. The acquisition of Mirec provided us with operations in the United Kingdom, Netherlands, Belgium and Sweden, with alliances in Denmark, Ireland, Germany, France, Switzerland and Italy. The acquisition of M+R has provided us with unique technical capabilities for the recycling of electronic and electrical equipment and non-ferrous metals processing as well as a broadened operational base in Europe. The acquisition of LCS in the United Kingdom further strengthened our information technology asset management capability and positioning as one of Europe’s leading operators in the high value B2B market. These acquisitions are also expected to provide us with a platform to further enhance our business as legislation continues to take effect across Europe.

Australasia

We are committed to providing an effective and efficient e-recycling program and have operations in Australasia to address the growing social and environmental problem that end-of-life computers and other information technology equipment represents. As part of this program, we established Australia’s first national e-recycling network, in joint venture with a leading global environmental services company.

The acquisition of Clearhouse provided us with one of the leading service providers in Australia covering the collection, data protection, redeployment and remarketing of obsolete IT equipment for a variety of governments and B2B customers.

We made an initial investment in the rapidly developing Indian e-recycling market, through the acquisition of Trishyiraya, based in Chennai. We recently commissioned Australia’s first e-recycling mechanical plant in Sydney.

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Secondary Processing

We operate a number of small manufacturing businesses in Australia, including secondary aluminum and plastics operations which produce, for resale, specification aluminum alloy products and pellets, respectively. We also operate a plastics and aluminum trading business and have a 50% interest in Australian Refined Alloys, Australia’s largest secondary lead smelter, in a joint venture with Nyrstar.

Until June 30, 2009, we operated a small tire recycling business in Australia, which produced granulated rubber utilized in various rubberized surfaces. We sold this business to a third party on June 30, 2009.

We have a 50% interest in LMS Generation Pty Limited, a specialist landfill gas and renewable energy company, which researches, installs and develops landfill gas extraction systems, renewable energy and power generation technologies.

Sources and Availability of Raw Materials

Metal Recycling

We purchase metals for our Metal Recycling business from two primary sources:

• obsolete metal which is sourced from metal dealers, peddlers (individuals that constitute Sims’s retail trade), auto wreckers, demolition firms, railroads and others who generate steel or non-ferrous metals; and

• industrial generated materials which are sourced mainly from manufacturers who generate off cuts or by-products made from steel, iron or non-ferrous metals, known as prompt or industrial metal.

Suppliers are generally not bound by long-term contracts and have no obligation to sell metals to us. Among other things, the supply of these raw materials can be dependent on prevailing market conditions, including the buy and sell prices of ferrous and non-ferrous recycled metals. In periods of low prices, suppliers may elect to hold metal to wait for higher prices or intentionally slow their metal collection activities. In addition, a global slowdown of industrial production, similar to what occurred in fiscal 2009, reduces the supply of industrial grades of metal to the metal recycling industry, potentially reducing the amount of metals available for us to recycle.

Sims Recycling Solutions

We source raw materials for our Sims Recycling Solutions business from a number of sources, including:

• manufacturers of post-consumer electronic products who must comply with specific end of life disposal requirements under legislation such as the WEEE Directive; and

• the business community for remarketable, reusable or recyclable electronic and electrical products.

The availability of these raw materials may depend on the continuation of existing disposal legislation and our ability to extend existing contracts or enter new contracts for the collection of post-consumer recyclable materials.

Government Regulation

In each of the jurisdictions in which we operate, we are subject to a variety of laws and regulations relating to trade, competition, taxes, employees and employee benefits, worker health and safety, land use, the environment and other matters. Certain of these laws and regulations, in particular those relating to worker health and safety and the environment, have a material impact on our ongoing

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business operations. Changes in these laws or regulations or their interpretations or enforcement may require us to make expenditures or change our business practices. For example, changes in environmental laws and regulations have in the past, and may in the future, require us to spend substantial amounts to comply with restrictions on air emissions, wastewater discharge, waste management and landfill sites, including remediation costs. There is a general trend toward increased government regulation, including environmental regulation, in many of the jurisdictions in which we operate.

Environmental Matters

Our business is subject to comprehensive statutory and regulatory environmental requirements in each of the jurisdictions in which we operate, including, among others, regulations governing: the acceptance, storage, treatment, handling, and disposal of waste, including ASR, and PCB materials; the discharge of materials into the atmosphere, potentially including chlorofluorocarbons; the management and treatment of wastewater and storm water discharges; the potential remediation of soil and groundwater impacts; the resolution of potential impacts to natural resources; and the protection of public and employee health and safety. We do not believe that pending or potential matters under these statutory and regulatory environmental requirements, if adversely determined, would have a material adverse effect on our financial condition.

The nature of our business and previous operations by others at facilities currently or formerly owned or operated or otherwise used by Sims exposes us to risks of claims under environmental laws and regulations and for the remediation of soil or groundwater impacts. Management does not believe that pending or potential claims and remediation matters, if adversely determined, would have a material adverse effect on our financial condition.

Sustainability

We are committed to environmental stewardship and the preservation of natural resources and, as such, sustainability is an important and continuing focus of our operations.

Recycling is known to be one of the best and most effective means of reducing energy consumption and carbon emissions. It also preserves scarce natural resources, saves water, and reduces pollution and our dependence on landfills.

In recognition of our dedication to sustainability, we were honored to be named at the 2009 World Economic Forum in Davos, Switzerland as one of the top 100 most sustainable corporations in the world. The Global 100 Most Sustainable Corporations in the World project was launched in 2005 to identify companies that consistently demonstrate superior positioning and performance in environment, social and governance issues relative to their industry peers. In addition, we have been a regular participant in the Carbon Disclosure Project for four years, the FTSE4Good in previous years and this year marks our second year of participation in the Dow Jones Sustainability Index.

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Seasonality

Our operations can be adversely affected by protracted periods of inclement weather, reduced levels of industrial production, or interruptions in transportation services from vessel carriers, railroads or barge lines, which may reduce the volume of material processed at our facilities. The geographic diversification of our operations mitigates these factors to some degree. In addition, periodic maintenance shutdowns or labor disruptions at our larger customers may have an adverse impact on our operations.

Patents and Trademarks

Management believes that our operations are not dependent to any significant degree upon any single patent or license, or series of related patents or licenses, or any single commercial or financial contract. Management also believes that our operations are not dependent upon any single trademark or trade name, although trademarks and trade names are identified with a number of our products and services and are of importance in the sale and marketing of such products and services.

C. Organizational Structure

We are organized under the laws of Australia. For a list of our wholly-owned and indirectly owned subsidiaries, see Exhibit 8.1 filed hereto.

D. Property, Plant and Equipment

Our principal executive offices are located in New York, New York. We also have regional executive offices in Chicago, Illinois; Botany, Australia, Hong Kong and Stratford upon Avon, United Kingdom. We lease each of our executive office facilities.

As of June 30, 2009, we had over 230 operating facilities and are represented in 15 countries throughout the world, with a large proportion in North America, Australia and the United Kingdom. We own many of these properties and continue to improve and replace properties when considered appropriate to meet the needs of our individual operations. There are no individually significant properties that were under-utilized during fiscal 2009. These properties range in size from approximately 6,100 square feet to 3,172,500 square feet.

The following is a list of the location and use of our significant properties. This list is not intended to be a complete list of all of our operating facilities.

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AUSTRALASIAN SITES

Location Canberra, Australian Capital Territory, Australia Alexandria, New South Wales, Australia Milperra, New South Wales, Australia St. Marys, New South Wales, Australia Villawood, New South Wales, Australia Wetherill Park, New South Wales, Australia Darwin, Northern Territory, Australia Gladstone, Queensland, Australia Northgate, Queensland, Australia Rocklea, Queensland, Australia Townsville, Queensland, Australia Gillman, South Australia, Australia Bell Bay, Tasmania, Australia Braeside, Victoria, Australia Broadmeadows, Victoria, Australia Brooklyn, Victoria, Australia Laverton North, Victoria, Australia Laverton North, Victoria, Australia Moolap, Victoria, Australia Noble Park, Victoria, Australia Karratha, Western Australia, Australia Spearwood, Western Australia, Australia Christchurch, New Zealand Wellington, New Zealand Auckland, New Zealand	Leased or Owned Leased Owned (50% interest) Owned Owned Leased Owned Owned Owned Owned Owned Leased Owned Leased Leased Owned Owned Owned Owned (50% interest) Owned Owned Owned Owned Owned (50% interest) Owned (50% interest) Owned (50% interest)	Principal Activities
		metal recycling yard ARA secondary lead smelting operation metal recycling yard metal recycling yard/ shredder/ e-recycling facility metal recycling yard metal recycling yard metal recycling yard metal recycling yard metal recycling yard/ shredder metal recycling yard metal recycling yard/ shredder metal recycling yard e-recycling facility metal recycling yard metal recycling yard/ shredder Secondary aluminium/ melting & processing operation ARA secondary lead smelting operation Aluminium salt slag recovery plant metal recycling yard metal recycling yard/ feeder yard metal recycling yard/ shredder/ e-recycling metal recycling yard/ shredder metal recycling yard metal recycling yard/ shredder

EUROPEAN SITES

Location Europark Nord, Sint Niklaas, Belgium Rathenaustrasse, Bergkamen, Germany Dillenburgstraat, Eindhoven, Netherlands Sint Janskamp, Echt, Netherlands Karosserigatan, Katrineholm, Sweden Avonmouth, Bristol, UK Dunkirk, Nottingham, UK Longside Industrial Estate, Dumfries, UK Long Marston, Stratford upon Avon, UK South Dock, Newport, UK Wimborne, Dorset, UK Yateley, Hants, UK	Leased or Owned Leased Owned Owned Leased Leased Leased Owned Owned Leased Leased Owned Owned	Principal Activities
		e-recycling facility e-recycling facility e-recycling facility e-recycling facility e-recycling facility metal recycling yard/dock/shredder metal recycling yard/shredder e-recycling facility UK head office, metal recycling yard/ dense media plant/ R & D centre metal recycling yard/ dock/ shredder/ fridges processing and e-recycling facility metal recycling yard/ shredder metal recycling yard/shredder

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NORTH AMERICAN SITES

Location Richmond, British Columbia, Canada Brampton, Ontario, Canada Birmingham, Alabama, USA Phoenix, Arizona, USA Tucson, Arizona, USA Richmond, California, USA Anaheim, California, USA Bakersfield, California, USA Fontana, California, USA Hayward, California USA Long Beach, California, USA Redwood City, California, USA Roseville, California, USA Sacramento, California, USA San Jose, California, USA Sun Valley, California, USA Terminal Island, California, USA Denver, Colorado, USA Hartford, Connecticut, USA North Haven, Connecticut, USA Bedford Park, Illinois, USA Chicago, Illinois, USA Franklin Park, Illinois, USA West Chicago, Illinois, USA East Chicago, Indiana, USA Detroit, Michigan, USA Greenville, Mississippi, USA Sherman, Mississippi, USA Port of Albany, New York, USA Las Vegas, Nevada, USA Claremont Pier, Jersey City, New Jersey, USA Newark, New Jersey, USA Port of Newark, Newark, New Jersey, USA Defiance, Ohio, USA Elizabeth, Pennsylvania, USA Morrisville, Pennsylvania, USA La Vergne, Tennessee, USA	Leased or Owned Leased (50% owned joint venture) Leased Owned Owned Owned Owned Owned (50% owned joint venture) Owned (50% owned joint venture) Owned (50% owned joint venture) Leased Leased (50% owned joint venture) Leased Leased Leased Leased Leased (50% owned joint venture) Leased (50% owned joint venture) Owned Leased Owned Owned Owned Owned Leased Owned Owned Leased Owned Leased Owned (50% owned joint venture) Owned Owned Leased Owned Owned Owned Leased	Principal Activities
		metal recycling yard/shredder e-recycling facility metal recycling yard/shredder metal recycling yard/shredder metal recycling yard/shredder metal recycling yard metal recycling yard/shredder metal recycling yard/shredder metal recycling yard e-recycling facility metal recycling yard metal recycling yard/ shredder e-recycling facility metal recycling yard metal recycling yard metal recycling yard metal recycling yard/ shredder metal recycling yard/ shredder metal recycling yard metal recycling yard/ shredder metal recycling yard metal recycling yard/ shredder precious metal refining e-recycling facility metal recycling yard metal recycling yard metal recycling yard/ shredder metal recycling yard metal recycling yard metal recycling yard/shredder metal recycling yard/ shredder metal recycling yard/shredder stevedoring metal recycling yard metal recycling yard metal recycling yard/shredder e-recycling facility

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Location Memphis, Tennessee, USA Nashville, Tennessee, USA Houston, Texas, USA Salt Lake City, Utah, USA Chesapeake, Virginia, USA Richmond, Virginia, USA Petersburg, Virginia, USA	Leased or Owned Owned Owned (50% owned joint venture) Owned Owned Owned Owned Leased	Principal Activities
		metal recycling yard/ shredder metal recycling yard/ shredder metal recycling yard metal recycling yard/ shredder metal recycling yard/ shredder metal recycling yard/ shredder metal recycling yard/ shredder

We believe that our facilities are suitable for their present use and are generally in good operating condition. We carry insurance covering property and casualty and certain other risks to which its facilities and operations may be subject. We do not believe that our earnings are materially dependent upon any single operating facility.

Item 4A. Unresolved Staff Comments

Not applicable.

Item 5. Operating and Financial Review and Prospects

A. Operating results

This section begins with an overview of the principal factors and trends affecting our results of operations. The overview is followed by a discussion of our critical accounting policies and estimates that we believe are important to understanding the assumptions and judgments reflected in our reported financial results. We then present an analysis of our results of operations for the last three fiscal years. Our primary segment reporting is based on the following geographical divisions: Australasia, North America and Europe.

The following discussion should be read in conjunction with our consolidated financial statements included in Item 18 of this annual report and “Item 3.D — Key Information — Risk Factors.” Our financial statements and the financial information discussed below have been prepared in accordance with IFRS.

On March 14, 2008, we merged with Metal Management. Operating results for Metal Management are only included in our operating results in fiscal 2008 for 3.5 months. Accordingly, the results for fiscal 2008 are not directly comparable to the results for fiscal 2009 or fiscal 2007.

Principal factors affecting our Results of Operations

The scrap metal recycling industry has historically been highly cyclical and is affected significantly by general economic conditions, both domestically and internationally. Historically, in periods of national recession or periods of slowing economic growth, the scrap metal recycling industry has experienced cyclical downtrends. In fiscal 2009, our results of operations were impacted severely by the global financial crisis and recession. Prior to fiscal 2009, the scrap metal industry experienced a cyclical uptrend which led to record results for the company in fiscal 2008. The favorable operating results in fiscal 2008 were primarily driven by strong global demand, primarily from China, Korea, Turkey and other developing countries.

We believe we have a competitive advantage in the scrap metal recycling industry based on the size and scope of our business, our product line diversification and other strengths including favorable

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port locations. Additionally, we operate a geographically diverse business with a network of processing facilities throughout the world.

Our revenues are predominantly derived from the sale of processed scrap metal. Prices for scrap metals vary by product type (ferrous or non-ferrous) and fluctuate on a monthly basis. Our selling prices for scrap metal are impacted by worldwide and local demand, country-specific economic conditions, and commodity spot prices for non-ferrous metals.

Like other competitors within the metal recycling business, we rely on generating a margin between the sales price to the end customer over the price paid to the suppliers of unprocessed metals. A key global driver for us is ferrous scrap prices for benchmark grades such as heavy melting steel, shredded steel and various prime grades which are highly correlated to steel prices. During an increasing price environment, our margins generally increase as the difference in timing between buying unprocessed scrap and selling processed product typically results in higher margins. Conversely, decreasing scrap prices generally have the opposite effect on margins and profitability. Additionally during times of lower scrap prices, suppliers of obsolete scrap sometime elect to hold onto scrap to wait for higher prices, which exacerbates the cyclicality in margins.

Over the last several years, freight costs, and in particular ocean freight rates, have impacted our results of operations. Ocean freight rates for bulk cargoes were high and volatile throughout fiscal 2007 and 2008, but declined significantly in fiscal 2009. The volatility in ocean freight rates is impacted by demand for bulk cargo ships from producers of iron ore, steel, coal and other commodities. We also faced competition from smaller scrap metal recyclers who began to use ocean containers to export ferrous scrap metal. The costs for ocean containers have been significantly less on a per-ton basis than bulk cargoes. In order to address the disparity in freight rates, we also ship ferrous scrap in ocean containers from certain facilities. Freight costs for rail and trucks have also been volatile and are impacted by demand and energy costs.

Because a substantial portion of our assets, liabilities, sales and earnings are denominated in currencies other than the Australian dollar (our reporting currency), we are exposed to fluctuations in the values of these currencies relative to the Australian dollar. These currency fluctuations, especially the fluctuation of the value of the U.S. dollar relative to the Australian dollar, can impact our operating results. From time to time, we use derivative financial instruments such as foreign exchange contracts and commodity hedges to hedge certain risk exposures for specific transactions.

Recent Developments

In our first quarter of fiscal 2010, we have seen the ferrous markets firming in terms of pricing and demand, primarily due to strong demand from export markets in developing countries. Non-ferrous markets remain liquid with relatively firm pricing. Scrap flows continue to be lackluster relative to historic highs but have modestly increased recently. A sustainable recovery in scrap flows, relative to the highs seen in fiscal 2008, is subject to successful economic stimulus plans being implemented around the world and a return to more normalized consumer discretionary spending and industrial production.

Critical Accounting Policies

Management’s discussion and analysis of our operational results and financial condition is based on our financial statements, which have been prepared in accordance with IFRS. Our critical accounting policies affecting our results of operations and financial condition are more fully described in Notes 1 and 3 to the consolidated financial statements included in Item 18 of this annual report. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of revenue, assets, liabilities and expenses. We re-evaluate our estimates on an on-going basis. Our estimates are based on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

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Recently issued accounting pronouncements

Recently-issued accounting pronouncements that are relevant to our operations but have not yet been adopted are more fully described in Note 1 to the consolidated financial statements included in Item 18 of this annual report.

Results of Operations

Comparability and change in accounting policy

In fiscal 2009, we revised our accounting policy for the valuation of land, buildings and leasehold improvements from the revaluation method to the historical cost method in accordance with AASB 116. The policy change results in the financial statements providing more reliable and more relevant information about the effects of transactions, other events and conditions on our financial position and financial performance. This will allow for enhanced comparability with our peers and also provide a consistent valuation methodology among all fixed asset classes for the benefit of current and prospective investors and for internal financial reporting purposes. The change was also intended to reduce administrative costs in the form of professional fees incurred to accomplish the revaluations. This change in accounting policy has been applied retrospectively in this annual report. Refer to Note 1(b)(iv) in the consolidated financial statements included in Item 18 of this annual report.

Fiscal 2009 compared with fiscal 2008

Fiscal 2009 was a tumultuous year for us, as the extraordinary economic crisis impacted nearly every company engaged in the global trading of bulk commodities. Our industry was directly affected by markedly lower commodity prices, diminished flows of scrap metals and decreased finished steel and metal production. The challenges we faced due to the global financial crisis and recession during fiscal 2009 — which is commonly assessed as the worst on record since the 1930’s — included the near halt of the credit markets, the failure or inability of certain ferrous and non-ferrous consumers to honor contractual commitments, the severe constriction of scrap flows around the world and substantially reduced demand for recycled raw materials.

During fiscal 2009, we took decisive action to reduce spending and headcount to mitigate the global recession’s impact on us, which we believe will position us as an even leaner and stronger company. Our fiscal 2009 results reflect the following significant expenses.

(inthousands)	2009 A$
Goodwill impairment charge	191,094
Write-down of inventory to net realizable value	119,418
Sarbanes-Oxley related professional fees1,8	9,661
Withdrawal liability related to a multi-employer pension plan2,8	3,422
Impairment provisions for trade receivables3,8	23,678
Professional fees and other costs incurred in connection with Fairless Iron & Metal acquisition4,8	2,541
Severance8	5,481
Loss on sale of subsidiaries5,8	2,577
Asset impairments and yard closure costs6,8	13,669
Merger costs7,8	4,048

1 Represents external professional fees related to the compliance with Section 404 of the Sarbanes-Oxley Act of 2002 (United States).

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• 2 Represents a termination liability associated with the withdrawal from a multi-employer pension plan in the United States.

• 3 Represents provisions recorded for trade debtors for which the Group believes collectibility is in doubt.

• 4

• 4 The acquisition of Fairless Iron & Metal was completed on July 3, 2009. As a result, the Group has applied the transitional principles consistent with the revised AASB 3 whereby transaction costs are expensed for all acquisitions prospectively from July 1, 2009.

• 5 Represents the loss on sale of Tyrecycle.

• 6

• Amounts represent the write-down of equipment as a result of asset retirements and rationalization, write-down of an investment and costs related to yard closures.

• 7

• Merger costs include integration bonuses, retention incentives and other costs associated with the post merger rationalization of the Sims Metal Management Limited and Metal Management businesses.

• 8 These amounts are reflected in other expenses in the table below.

Despite enduring recessionary economic conditions, our sales revenue in fiscal 2009 increased 13% to A$8.6 billion, even though yearover-year average selling prices declined. However, this increase primarily was due to the March 2008 merger with Metal Management.

The following table sets forth selective line items and the percentage of net sales that they represent for the periods indicated. The comparability of fiscal 2009 to fiscal 2008 will be impacted by the March 2008 Metal Management acquisition which is included for a full year in fiscal 2009 and for only 3.5 months in fiscal 2008 and also by the effects of the global financial crisis on our fiscal 2009 results.

			Fiscal years ended June 30,	Fiscal years ended June 30,	%of Sales	% Change
		2009 A$	%of 2008 Sales A$ (in thousands, except percentage data)
Total revenue		8,641,010	100	7,670,536	100	13
Cost of materials and freight		(7,191,933)	(84)	(6,103,252)	(80)	18
Depreciation and amortization		(170,820 )	(2 )	(95,086 )	(1 )	80
Finance costs		(21,508)	(0)	(34,374)	0	(37)
Income from equity accounted investments		60,808	1	64,573	1	(6 )
Goodwill impairment charge		(191,094)	(2)	(3,349)	0	n/a
Other expenses		(1,248,625 )	(15 )	(838,445 )	(11 )	49
(Loss)/profit before income tax		(122,162)	(2)	660,603	9	(118)
Income tax expense		(28,133 )	0	(220,505 )	(3 )	(87 )
(Loss)/profit after tax		(150,295)	(2)	440,098	6	(134)

In fiscal 2009, total revenue was a record A$8.6 billion, a 13% increase from fiscal 2008. Despite year-over-year decreases in average selling prices, revenue increased due to the merger with Metal Management, which is included for all of fiscal 2009 but only 3.5 months of fiscal 2008. See detailed discussion below on revenue by segment and product group.

Cost of materials and freight was A$7.2 billion in fiscal 2009 compared to A$6.1 billion in fiscal 2008. The increase was primarily due to higher material costs related to higher sales as a result of the merger with Metal Management. Cost of materials also includes the write-down of inventories to net realizable value of A$119.4 million in fiscal 2009.

Depreciation and amortization expense was A$170.8 million in fiscal 2009 compared to A$95.1 million in fiscal 2008. The increase primarily reflects the depreciation and amortization related to Metal Management, which is included for all of fiscal 2009 but only 3.5 months in fiscal 2008. Depreciation expense also increased due to higher levels of capital expenditures, which were A$187.5 million in fiscal 2009 compared to A$129.7 million in fiscal 2008.

Finance costs were A$21.5 million in fiscal 2009 compared to A$34.4 million in fiscal 2008. The decrease was primarily due to lower borrowings as a result of cash flows generated from operations. See “Liquidity and Capital Resources” discussion below for further information related to our borrowings.

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Income from equity accounted investments was A$60.8 million in fiscal 2009 compared to A$64.6 million in fiscal 2008. Our most significant equity accounted investment relates to SA Recycling LLC which was formed in September 2007 and is only included in our fiscal 2008 results for 10 months. Income from SA Recycling was A$51.8 million in fiscal 2009 compared to A$47.4 million in fiscal 2008. Due to our poor operating results in fiscal 2009, SA Recycling’s income was significant to us as defined by Rule 1-02(w) of Regulation S-X of the Exchange Act. As a result, we have included audited financial statements of SA Recycling for the year ended June 30, 2009 under Item 18 of this annual report. The audited consolidated financial statements of SA Recycling are prepared in accordance with U.S. Generally Accepted Accounting Principles and in U.S. dollars. We report our share of SA Recycling’s income by making adjustments for accounting policies that differ from our policies under IFRS. We translate SA Recycling’s financial statements from U.S. dollars to Australian dollars using average exchange rates for the period for profit and loss items, and closing rates for balance sheet items.

In fiscal 2009, we recorded a goodwill impairment charge of A$191.1 million related to four CGUs within the North America segment and one CGU in the Australasia segment. Refer to Note 13 in our consolidated financial statements included in Item 18 of this annual report for further information related to asset impairment testing.

Other expenses primarily represent employee benefits expense and repairs and maintenance. The increase predominantly represents expenses from a full year inclusion of Metal Management in fiscal 2009 versus 3.5 months in fiscal 2008 and the significant expenses recorded in fiscal 2009 which are noted above.

Income tax expense was A$28.1 million in fiscal 2009 resulting in an effective tax rate of (23.0)% compared to A$220.5 million in fiscal 2008 and a corresponding effective tax rate of 33%. Although we incurred a loss before income tax of A$122.1 million, an income tax provision was recognized due to the non-deductibility of the A$191.1 million goodwill impairment charge. Excluding the impact of the nondeductible goodwill impairment charge, our effective tax rate was 40.8% which reflects the change in the geographical mix of our sources of income.

Loss after tax was A$(150.3) million in fiscal 2009 compared to profit after tax of A$440.1 million in fiscal 2008. The loss in fiscal 2009 was primarily due to the non-cash goodwill impairment charge.

Results by segments

The following table sets forth our revenue and earnings before interest and taxes, or EBIT, by segment. In discussing the operating results of our segments, we focus on EBIT which is a non-GAAP (IFRS or U.S.) financial measure. EBIT is the key measure that management uses internally to assess the performance of our business, make decisions on the allocation of resources and assess operational management. EBIT is not a measure that is recognized under IFRS and it may differ from similarly titled measures reported by other companies. Therefore, in the table below, we provide a reconciliation of EBIT to (loss)/profit before income tax.

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(in thousands)			Fiscal years ended June 30,	Fiscal years ended June 30,	Fiscal years ended June 30,
		2009 A$	%		2008 A$	%
Sales by geography:
Australasia		1,158,619	13		1,745,109	23
North America		6,368,489	74		4,607,898	60
Europe		1,109,117	13		1,312,584	17
Total sales		8,636,225			7,665,591
Other revenue		4,785	0		4,945	0
Total revenue		8,641,010	100		7,670,536	100
Sales by product:
Ferrous metals		6,642,694	77		5,421,102	71
Non-ferrous metals		1,193,397	14		1,324,123	17
Secondary processing		221,624	2		361,159	5
Recycling solutions		578,510	7		559,207	7
Net sales		8,636,225	100		7,665,591	100
EBIT by geography:
Australasia		18,696	(18 )		182,364	26
North America		(88,545)	86		415,726	60
Europe		(33,077 )	32		94,011	14
Total EBIT		(102,926)	100		692,101	100
Reconciliation:
Total EBIT		(102,926)			692,101
Interest income		2,272			2,876
Finance costs		(21,508)			(34,374)
(Loss)/profit before income tax		(122,162 )			660,603

Australasia

Sales in fiscal 2009 decreased by A$586.5 million (33.6%) to A$1.2 billion from A$1.7 billion in fiscal 2008. EBIT in fiscal 2009 decreased by A$163.7 million (89.7%) to A$18.7 million from A$182.4 million in fiscal 2008.

The decrease in sales was due to a 27% reduction in scrap tonnage processed and overall lower commodity prices. EBIT in Australasia was impacted by A$9 million of inventory adjustments, A$9 million of non-ferrous contract renegotiations and A$12 million of other abnormal items (including A$1 million of goodwill impairment).

North America

The global economic recession was particularly severe in North America, where approximately 55% of all new steel production was idled as of the end of June 2009. Sales in fiscal 2009 increased by A$1.8 billion (38.2%) to A$6.4 billion from A$4.6 billion in fiscal 2008. EBIT in fiscal 2009 was a loss of A$88.5 million compared to a profit of A$415.7 million in fiscal 2008.

The increase in sales was a result of a full year contribution from Metal Management compared to 3.5 months in fiscal 2008. However, scrap tonnage processed and brokered declined by 29% resulting in lower sales volumes and we also experienced lower commodity prices. Negative EBIT was caused by a A$190.2 million goodwill impairment charge. EBIT was also impacted by A$71 million of inventory adjustments, A$19 million of non-ferrous contract renegotiations and A$36 million of other abnormal items. EBIT in fiscal 2009 was positively impacted by income from SA Recycling of A$51.8 million.

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Europe

Sales in fiscal 2009 decreased by A$203.5 million (15.5%) to A$1.1 billion from A$1.3 billion in fiscal 2008. EBIT in fiscal 2009 was a loss of A$33.1 million compared to a profit of A$94.0 million in fiscal 2008. The decrease in sales was due a 20% reduction in scrap inflows and lower commodity prices. EBIT decreased as a result of by A$39 million of inventory adjustments and A$8 million of non-ferrous contract renegotiations.

Sales by Product Group

Ferrous sales were A$6.6 billion in fiscal 2009 compared to A$5.4 billion in fiscal 2008, representing an increase of A$1.2 billion (22.5%). The increase in ferrous sales was mainly due to a full year contribution from Metal Management versus 3.5 months in fiscal 2008. In fiscal 2009, ferrous sales volumes (including brokerage) increased by approximately 1.7 million tons, or 15%, to 12.6 million tons compared to 10.9 million tons in fiscal 2008. However, overall ferrous commodity prices were lower in fiscal 2009.

Non-ferrous sales were A$1.2 billion in fiscal 2009 compared to A$1.3 billion in fiscal 2008. Even though there was a full year contribution from Metal Management in fiscal 2009, non-ferrous sales decreased due to lower commodity prices and the impact of non-ferrous contract renegotiations. In fiscal 2009, non-ferrous sales volumes (including brokerage) increased by approximately 11,000 tons (2%), to 464,000 tons compared to 453,000 tons in fiscal 2008.

Secondary processing sales were A$221.6 million in fiscal 2009 compared to A$361.1 million in fiscal 2008, which represented a decrease of A$139.5 million (38.6%). The decrease in sales was primarily due to the sale of Sims Steel in fiscal 2008.

Recycling solutions sales were A$578.5 million in fiscal 2009 compared to A$559.2 million in fiscal 2008. Recycling solutions sales were also impacted in fiscal 2009 by lower commodity prices but volumes held steady.

Fiscal 2008 compared with fiscal 2007

The following table sets forth selective line items and the percentage of net sales that they represent for the periods indicated.

			Fiscal years ended June 30,	Fiscal years ended June 30,	% Change
		2008 A$
Total revenue		7,670,536	100	5,550,897 100	38
Cost of materials and freight		(6,103,252)	(80)	(4,387,432) (79)	39
Depreciation and amortization		(95,086 )	(1 )	(74,453 ) (1 )	28
Finance costs		(34,374)	(0)	(30,405) (1)	13
Income from equity accounted investments		64,573	1	7,030 0	819
Other expenses		(841,794)	(11)	(708,748) (13)	19
Profit before income tax		660,603	9	356,889 6	85
Income tax expense		(220,505)	(3)	(116,951) (2)	89
Profit after tax		440,098	6	239,938 4	83

In fiscal 2008, total revenue was A$7.7 billion, a 38% increase from fiscal 2007. Approximately A$1.4 billion of the increase was attributable to the partial year contribution from Metal Management, which was acquired in March 2008. The increase in total revenue was also due to robust market conditions in the second half of fiscal 2008, resulting in record ferrous contributions experienced towards

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the end of fiscal 2008, particularly from the North America segment. See detailed discussion below on revenue by segment and product group.

Cost of materials and freight was A$6.1 billion in fiscal 2008 compared to A$4.4 billion in fiscal 2007. The increase was due to higher costs paid for unprepared scrap metal as a result of higher commodity prices, and costs of materials from recent acquisitions, most significantly Metal Management (approximately A$1.0 billion). Freight costs were also higher reflecting higher bulk cargo freight rates.

Depreciation and amortization expense was A$95.1 million in fiscal 2008 compared to A$74.5 million in fiscal 2007. The increase was due to depreciation and amortization related to recent acquisitions, most significantly Metal Management. Depreciation expense also increased due to higher levels of capital expenditures which were A$129.7 million in fiscal 2008 compared to A$90.5 million in fiscal 2007.

Finance costs were A$34.4 million in fiscal 2008 compared to A$30.4 million in fiscal 2007. The increase was primarily due to higher borrowings. The weighted average interest rate on our borrowings was 5.6% in fiscal 2008 compared to 6.7% in fiscal 2007. See “Liquidity and Capital Resources” discussion below for a further information related to our borrowings.

Income from equity accounted investments was A$64.6 million in fiscal 2008 compared to A$7.0 million in fiscal 2007. The increase was a result of the formation of the SA Recycling joint venture in September 2007 which accounted for A$47.4 million of income from equity accounted investments in fiscal 2008.

Other expenses primarily represent employee benefits expense and repairs and maintenance. The increase predominantly represents expenses from Metal Management which were included for 3.5 months in the fiscal 2008 results.

Income tax expense was A$220.5 million in fiscal 2008 resulting in an effective tax rate of 33.4% compared to A$117.0 million in fiscal 2007 and a corresponding effective tax rate of 32.8%. The increases were due to greater operating profits and a larger proportion of group profits generated in the United States where the federal statutory tax rate is 35% compared to 30% in Australia and 28% in the United Kingdom.

Profit after tax was a record A$440.1 million in fiscal 2008 compared to A$239.9 million in fiscal 2007. The record result was due to increased sales revenue, sales volumes, equity accounted income and a 3.5 month contribution from Metal Management (approximately A$86.8 million).

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Results by segments

The following table sets forth our revenue and EBIT by segment.

(in thousands)			Fiscal years ended June 30,	Fiscal years ended June 30,	Fiscal years ended June 30,
		2008 A$	%		2007 A$	%
Sales by geography:
Australasia		1,745,109	23		1,465,384	26
North America		4,607,898	60		2,938,245	53
Europe		1,312,584	17		1,144,891	21
Total sales		7,665,591			5,548,520
Other revenue		4,945	0		2,377	0
Total revenue		7,670,536	100		5,550,897	100
Sales by product:
Ferrous metals		5,421,102	71		3,587,925	64
Non-ferrous metals		1,324,123	17		1,264,402	23
Secondary processing		361,159	5		262,347	5
Recycling solutions		559,207	7		433,846	8
Net sales		7,665,591	100		5,548,520	100
EBIT by geography:
Australasia		182,364	26		154,183	40
North America		415,726	60		163,570	43
Europe		94,011	14		67,177	17
Total EBIT		692,101	100		384,930	100
Reconciliation:
Total EBIT		692,101			384,930
Interest income		2,876			2,364
Finance costs		(34,374)			(30,405)
Profit before income tax		660,603			356,889

Australasia

Sales in fiscal 2008 increased by A$279.7 million (19.1%) to A$1.7 billion from A$1.5 billion in fiscal 2007. EBIT in fiscal 2008 increased by A$28.2 million (18.3%) to A$182.4 million from A$154.2 million in fiscal 2007. The increase in sales and EBIT was due to higher prices for scrap metals and increased sales volumes.

The strength of the Australasia business in fiscal 2008 was reflected in a 12% increase in ferrous tonnage physically handled, and a 4% increase in non-ferrous tons traded, compared to fiscal 2007. To a significant extent, these record volumes were driven by our expanding base of regional sites in key areas and strong demand throughout Australia’s mining centers. Ongoing capital investment in downstream technologies further enhanced non-ferrous recoveries from all of our shredder operations. In New Zealand, Sims Pacific Metals (our 50% joint venture) experienced strong demand from domestic consumers and also increased performance efficiencies as a result of major processing equipment upgrades.

North America

Sales in fiscal 2008 increased by A$1.7 billion (56.8%) to A$4.6 billion from A$2.9 billion in fiscal 2007. In U.S. dollar terms, sales increased by 83%. EBIT in fiscal 2008 increased by A$252.2 million (154.1%) to A$415.7 million from A$163.6 million in fiscal 2007.

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Market conditions in North America were strong in the second half, particularly towards the end of the third quarter and throughout the fourth quarter of fiscal 2008. The increase in sales and EBIT was due to higher prices for scrap metals, higher sales volumes and approximately A$1.4 billion of sales and A$140.2 million of EBIT from Metal Management for 3.5 months in fiscal 2008. Total processed and brokered ferrous and non-ferrous tons in North America increased 33%, year on year, to approximately 7.9 million tons. Fiscal 2008 EBIT also includes a 10 month contribution from the SA Recycling joint venture (A$47.4 million).

Europe

Sales in fiscal 2008 increased by A$167.7 million (14.6%) to A$1.3 billion from A$1.1 billion in fiscal 2007. EBIT in fiscal 2008 increased by A$26.8 million (39.9%) to A$94.0 million from A$67.2 million in fiscal 2007. Our European operations also enjoyed a record performance in fiscal 2008, with strong ferrous market conditions, particularly in the second half of the year.

Year on year, ferrous intake grew by 16% and non-ferrous volumes by 34% contributing to the record performance. Our results also benefited from the full year inclusion of Cymru Metals, which was acquired in January 2007.

Sales by Product Group

Ferrous sales were A$5.4 billion in fiscal 2008 compared to A$3.6 billion in fiscal 2007, representing an increase of A$1.8 billion (51.1%). The increase in ferrous sales was mainly due to higher selling prices, particularly in the fourth quarter in the United States. Ferrous sales also benefited from the inclusion of sales from Metal Management for 3.5 months in fiscal 2008 (approximately A$1.1 billion). In fiscal 2008, ferrous sales volumes (including brokerage) increased by approximately 2.0 million tons, or 22%, to 10.9 million tons compared to 9.0 million tons in fiscal 2007. Substantially all of the ferrous sales volume increase was attributable to Metal Management (approximately 1.8 million tons).

Non-ferrous sales were slightly higher in fiscal 2008 at A$1.32 billion when compared to fiscal 2007 non-ferrous sales of A$1.26 billion. In fiscal 2008, non-ferrous sales volumes increased by approximately 61,000 tons (16%), to 453,000 tons compared to approximately 392,000 tons in fiscal 2007. All of the increase was attributable to Metal Management.

Secondary processing sales were A$361.2 million in fiscal 2008 compared to A$262.3 million in fiscal 2007, which represented an increase of A$98.8 million (37.7%). The increase in sales was primarily due to an increase in lead prices and volumes for the ARA joint venture.

Recycling solutions sales were A$559.2 million in fiscal 2008 compared to A$433.8 million in fiscal 2007, which represented an increase of A$125.4 million (28.9%). The increase reflected a full year contribution from the businesses acquired in fiscal 2007, strong metal prices (particularly for precious metals) and an initial contribution from the “lifecycle management” dimension of the business.

B. Liquidity and Capital Resources

Treasury responsibilities and philosophy

The primary responsibilities of our treasury function are to secure access to capital resources, maintain an efficient capital structure, and manage the company’s liquidity, foreign exchange, interest rate and commodity price risk. Our overall financial risk management strategy seeks to mitigate these risks to reduce adverse volatility in them on our financial performance.

Financial risk management is carried out by a limited number of employees. We have written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and the investment of excess liquidity.

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We use derivative financial instruments in certain circumstances in accordance with Board approved policies to hedge exposure to fluctuations in foreign exchange rates or commodity prices. Derivative financial instruments are used for hedging purposes and not as trading or other speculative instruments.

For further information regarding our financial and capital risk management, including our use of derivatives, see Note 2 of our consolidated financial statements included in Item 18 of this annual report.

Sources of liquidity

Our sources of liquidity include cash and cash equivalents, collections from customers and amounts available under our unsecured multicurrency/multi-option credit facilities, most of which are global in nature. We believe these sources are adequate to fund operating expenses and related liabilities, planned capital expenditures and acquisitions, and the payment of cash dividends to shareholders for at least the next 12 months.

As of June 30, 2009, our cash and cash equivalents amounted to A$69.5 million compared to A$133.5 million as of June 30, 2008. As of June 30, 2009, total borrowings were A$175.1 million compared to A$398.4 million as of June 30, 2008. The majority of our borrowings are from our credit facilities. We had available borrowing capacity under our credit facilities of A$856.5 million as of June 30, 2009, compared to A$668.6 million as of June 30, 2008.

Our primary credit facilities are provided by Commonwealth Bank of Australia, or CBA, Westpac Banking Corporation, or WBC, and Bank of America Corporation, N.A., or BOA. All of our primary credit facilities are unsecured and are guaranteed by certain of our subsidiaries. There are no restrictions as to how much can be borrowed under the credit facilities provided we are not in default and the borrowings do not exceed the commitment amount. Our CBA credit facility, which matures on December 31, 2010, is for A$450 million and provides for multicurrency borrowings. Our WBC credit facility, which matures on August 1, 2010 is for A$250 million and also provides for multi-currency borrowings. Borrowings under both the CBA and WBC credit facilities bear interest at either (i) LIBOR plus a margin (for currencies other than the Australian dollar), or (ii) the Reuters Bank Bill Swap Bid Rate plus a margin (for Australian dollar borrowings). Our BOA credit facility, which matures on December 1, 2010, is for US$150 million and bears interest at either the U.S. Federal Funds Rate plus a margin, the U.S. Prime Rate or the Eurocurrency Floating Rate plus a margin.

These credit facilities generally contain customary representations and warranties and covenants. Customary negative covenants include certain restrictions on our ability and that of our subsidiaries to engage in certain corporate transactions without such lender’s consent, including: (i) the creation of certain liens on our property; (ii) mergers, dissolution, liquidation or consolidation with or into another entity; (iii) certain dispositions of our property; engaging in any substantially different material line of business; and (iv) certain related party transactions.

These credit facilities also require us to comply with certain financial covenants which are measured on a bi-annual basis. The primary financial covenants require us to have a minimum tangible net worth that is not less than 85% of our tangible net worth of the preceding year, a ratio of earnings before interest, taxes, depreciation and amortization, or EBITDA, to net interest expense ratio of not less than 3.5 times to 1 and a ratio of total financial indebtedness to EBITDA that is not greater than 3.0 to 1. We were in compliance with all of our financial covenants as of June 30, 2009.

Furthermore, these credit facilities contain customary events of default, such as: failure to pay any amounts outstanding under the credit facility when due; the failure to perform or observe certain covenants, including any financial covenant; certain breaches of any representation and warranty contained in the credit facility; the inability of us or any of our subsidiaries to pay its debts as they become due and payable; and the institution of an insolvency proceeding with respect to us or any subsidiary. The occurrence of an event of default under a credit facility could result in the termination of such credit facility by the lender and the acceleration of all amounts outstanding under such credit facility.

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These credit facilities also provide for cross defaults, such that if we default under one credit facility, we will be deemed to have defaulted under all of our credit facilities.

All of our bank credit facility providers may either vary the terms of their facilities to their satisfaction or, with varying notice periods, give notice of termination of their facilities. There can be no assurance that our lenders will continue to provide us with financing on acceptable terms.

During the course of fiscal 2009 it was agreed with CBA that the documentation governing its facility would be updated to reflect CBA’s current credit agreement documentation standards. Under a “most favored nation” understanding that we have with each of our bank credit providers the terms of each of our credit facilities can be no less favorable than those of any other facilities. Accordingly the changes to the CBA documentation were offered to our other credit providers and the documentation governing the facilities of those other providers was also updated where applicable. The “most favored nation” provision does not apply to pricing, tenor, fees or similar commercial terms. The changes to the documentation applicable to the facilities of each of our bank credit providers were finalized in November 2009.

Approximately A$870 million of our current loan facilities are denominated in Australian dollars.

Cash Flows

Fiscal 2009 compared with fiscal 2008

Net cash from operating activities was A$554.5 million in fiscal 2009 compared to A$247.5 million in fiscal 2008. The increase was primarily due to working capital changes which generated cash of A$325.9 million in fiscal 2009 compared to cash used for working capital of A$209.1 million in fiscal 2008. The improvement in working capital was due to a significant decline in commodity prices which resulted in lower accounts receivable and lower inventory values.

Net cash used in investing activities in fiscal 2009 was A$214.7 million compared to A$137.7 million in fiscal 2008. Cash used in investing activities increased in fiscal 2009 primarily due to higher capital expenditures and an increase in cash used for acquisitions. Capital expenditures in fiscal 2009 were A$187.5 million compared to A$129.7 million in fiscal 2008. Significant capital expenditures in fiscal 2009 include investments for recovery systems for automobile shredder residue and for the construction of a WEEE facility in the United Kingdom. We continue to invest in capital projects which are either replacement in nature or which we believe will enhance our operations. Cash used for acquisitions was A$76.0 million in fiscal 2009 compared to A$58.5 million in fiscal 2008. In fiscal 2009, we received A$39.7 million of cash from the sale of our non-core manufacturing businesses. In fiscal 2008, we received a return of capital of A$48.5 million from our joint ventures.

Net cash used in financing activities was A$426.8 million in fiscal 2009 compared to A$13.5 million in fiscal 2008. In fiscal 2009, we used cash generated from operations to repay outstanding borrowings resulting in a cash usage of A$265.3 million. In fiscal 2008, our borrowings increased by A$137.3 million primarily to fund our working capital needs. Cash dividends paid in fiscal 2009 was A$159.9 million compared to A$156.6 million in fiscal 2008. Although dividends per share decreased in fiscal 2009, the higher dividends were a result of the issuance of shares for the acquisition of Metal Management.

On October 26, 2009, we paid a dividend of A$0.10 per share to shareholders of record on October 9, 2009. The total amount of dividends paid was A$18.0 million which consisted of cash dividends of A$15.2 million and A$2.8 million of dividends reinvested into ordinary shares pursuant to our dividend reinvestment plan.

Fiscal 2008 compared with fiscal 2007

Net cash from operating activities was A$247.5 million in fiscal 2008 compared to A$335.5 million in fiscal 2007. Although profit after tax increased in fiscal 2008 by A$200.2 million, higher working capital balances resulted in lower cash flow generation from operations. Cash used for working capital was A$209.1 million in fiscal 2008 compared with cash generated from working capital of A$16.7 million in fiscal 2007. The increase in working capital was due to higher commodity prices which resulted in higher accounts receivable and inventory balances.

Net cash used in investing activities in fiscal 2008 was A$137.7 million compared to A$241.2 million in fiscal 2007. Cash used in investing activities decreased in fiscal 2008 due to lower cash outflows for acquisitions of A$58.5 million compared to A$158.9 million in fiscal 2007. In fiscal 2008, we also received a return of capital of A$48.5 million from our joint ventures. Capital expenditures in fiscal 2008 was A$129.7 million compared to A$90.5 million in fiscal 2007.

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Net cash used in financing activities was A$13.5 million in fiscal 2008 compared to A$71.5 million in fiscal 2007. In fiscal 2008, we increased our borrowings by A$137.3 million in order to fund increased working capital requirements, capital expenditures and dividend payments. Cash dividends paid increased to A$156.6 million in fiscal 2008 compared to A$120.0 million in fiscal 2007 primarily as a result of the issuance of 53.5 million shares for the acquisition of Metal Management.

C. Research and Development, Patents and Licenses

Not applicable.

D. Trends information

See “Item 5A — Operating Results” for information on material trends affecting our business and results of operations.

E. Off-Balance Sheet Arrangements

There are no material off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors, except as follows:

• We occasionally sell a portion of our accounts receivable to a third party under an US$35.0 million uncommitted facility agreement. At the time the receivables are sold, the receivables are removed from our consolidated balance sheet. All credit risk passes to the third party at the time of the assignment, such that we have no further exposure to default by the specific trade debtors. The third party is not obliged to accept offers of receivables and we are not obligated to make offers or pay commitment fees to the third party. At June 30, 2009, we had utilized US$17.8 million of this facility.

• We have provided letters of credit in respect of the performance of contracts and workers compensation insurance entered into in the ordinary course of business. At June 30, 2009, the amount of letters of credit was A$64.3 million.

• Along with our joint venture partner in SA Recycling, we both equally guarantee SA Recycling’s lines of credit. The amount of the guarantee we currently provide is A$83.9 million.

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F. Tabular Disclosure of Contractual Obligations

Our consolidated contractual obligations and commitments are summarized in the following table which includes aggregate information about our contractual obligations as of June 30, 2009 and the periods in which payments are due, based on the earliest date on which we could be required to settle the liabilities.

Contractual Obligations (inthousands of A$)				Payments due by period	Payments due by period	Payments due by period	Payments due by period	Payments due by period
		Total		Less than 1 Year		1 to 3 Years		3 to 5 Years	More than 5 Years
Long-term debt1		187,557		9,641		177,916		—		—
Capital expenditures		34,662		34,197		465		—		—
Derivatives — net settled		9,689		9,689		—		—		—
Derivatives — gross settled:
Inflows		(174,728 )		(174,728 )		—		—		—
Outflows		174,790		174,790		—		—		—
Pension plan contributions2		5,202		5,202		—		—		—
Operating leases		358,340		69,806		107,516		53,163		127,855
Total contractual cash obligations		595,512		128,597		285,897		53,163		127,855

1 — Long-term debt includes interest based on the June 30, 2009 floating interest rates.

• 2 — Pension plan contributions represent expected cash contributions to our defined benefit pension plans for the year ending June 30, 2009. It is not practicable to present expected cash contributions for subsequent years because they are determined annually on an actuarial basis to provide for current and future benefits in accordance with federal law and other regulations.

Item 6. Directors, Senior Management and Employees

A. Directors and senior management

Directors

Set forth below is information regarding the members of our Board of Directors, or the Board, as of October 1, 2009:

Name and Age Executive Directors: Daniel W. Dienst, 44 Non-Executive Directors: Paul J. Varello, 65 Norman R. Bobins, 66 J. Michael Feeney, 63 Masakatsu Iwanaga, 68 Robert Lewon, 66 Paul K. Mazoudier, 67 Gerald E. Morris, 77 Christopher J. Renwick, 66	Title Group Chief Executive Officer Chairman and Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Non-Independent, Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director Independent Non-Executive Director	Term Expires
		# + 2011 + 2011 2011 2010

• — Under our constitution, the Group Chief Executive Officer does not have a term limit.

• — Messrs. Iwanaga and Mazoudier will be retiring at the conclusion of the Annual General Meeting, or AGM, on November 20, 2009.

• • — Messrs. Varello and Feeney will be standing for re-election as Independent Non-Executive Directors at our AGM on November 20, 2009.

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Daniel W. Dienst

Executive Director and Group Chief Executive Officer since March 2008. Member of the Safety, Health, Environment & Community Committee, Nomination/Governance Committee and Finance & Investment Committee. Mr. Dienst was formerly a Director (since June 2001), Chairman (since April 2003), Chief Executive Officer (since January 2004) and President (since September 2004) of Metal Management who we merged with in March 2008. From January 1999 to January 2004, he served in various capacities with CIBC World Markets Corp., lastly as Managing Director of the Corporate and Leveraged Finance Group. From 2002-2005, he was Chairman of the Board of Metals USA, Inc., a NASDAQ — listed steel service center company until its sale to a private entity. He is a Director of other Sims Metal Management Limited subsidiaries and associated companies. He is a graduate of Washington University and received a JD from The Brooklyn Law School.

Paul J. Varello

Appointed as a Director in November 2005, appointed Vice-Chairman in November 2008 and Chairman in August 2009. Member of the Nomination/Governance Committee and the Finance & Investment Committee. Mr. Varello is Chairman of Commonwealth Engineering and Construction (“CEC”), located in Houston, Texas. Prior to founding CEC in 2003, he was Chairman and CEO of American Ref-Fuel Company. He is a registered professional engineer and a member of the American Society of Civil Engineers and the American Institute of Chemical Engineers.

Norman R. Bobins

Appointed as a Director in March 2008. Chairman of the Finance & Investment Committee. He was formerly a Director of Metal Management (since 2006). From 2008, Mr. Bobins is the Chairman of Norman Bobins Consulting LLC. From May 2007 until October 2007, Mr. Bobins was the Chairman of the Board of LaSalle Bank Corporation (a financial institution). From 2002 to 2007, he was President and Chief Executive Officer of LaSalle Bank Corporation. From 2006-2007, he was President and Chief Executive Officer of ABN AMRO North America. From 2002-2007, he was Senior Executive Vice President at ABN AMRO Bank N.V., the Dutch parent of LaSalle Bank Corporation. Mr. Bobins is the Non Executive Chairman of The PrivateBank and Trust Company. He is also a Director of NICOR, Inc., Transco, Inc., and AAR CORP. He earned his BS from the University of Wisconsin and his MBA from the University of Chicago.

J Michael Feeney

Appointed as a Director in September 1991. Chairman of the Remuneration Committee and member of the Risk, Audit & Compliance Committee. Mr. Feeney was formerly an Executive Director of Collins Partners Corporate Advisory and prior to that Finance and Strategy Director for Philip Morris, Executive Director, Strategy & Corporate Affairs for Elders IXL and Executive Director, Corporate Strategy of Elders Resources NZFP.

Masakatsu Iwanaga

Appointed as a Director in June 2007. He is a member of the Australia & New Zealand Chamber of Commerce in Japan. He joined Mitsui & Co., Ltd in 1963 and worked in various divisions of that company culminating in his appointment, in 1999, as President & Managing Director, Mitsui Iron Ore Development, a position he held until his retirement in 2005.

Robert Lewon

Appointed as a Director in March 2008. Chairman of the Nomination/Governance Committee and member of the Safety, Health, Environment & Community Committee and Finance & Investment Committee. He was formerly a Director (since March 2004) of Metal Management. Mr. Lewon has over 40 years of experience in the scrap metal industry and has served as an executive of scrap companies,

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including President of Simsmetal USA Corp. He has been active in the Institute of Scrap Recycling Industries, Inc. and its predecessor ISIS, serving as Director and national officer, among other positions. Additionally, he has served as a consultant to scrap metal companies since his retirement from Simsmetal in 1993, and, prior to his appointment as a Director of the Company, he was a long time advisor/consultant to TAMCO, the only steel mill in California.

Paul K. Mazoudier

Appointed as a Director in September 1991 and served as Chairman from January 1999 to August 2009. Member of the Safety, Health, Environment & Community Committee, Remuneration Committee and Risk, Audit & Compliance Committee. Mr. Mazoudier was formerly an Executive Director of Sims Consolidated (1974-79) and a former partner and NSW Chairman of Minter Ellison, lawyers. He was a Director of HPAL Limited from 2000 until November 2007.

Gerald E. Morris

Appointed as a Director in March 2008. Chairman of the Risk, Audit & Compliance Committee and member of the Remuneration Committee and Nomination/Governance Committee. He was formerly a Director (since January 2004) of Metal Management. Mr. Morris currently serves as President and CEO of Intalite International N.V., a diversified holding company with investments primarily in the metals fabrication industry. He also serves as Chairman and Director of Beacon Trust Company. He previously served as a Director of Metals USA, Inc., Rexel, Inc. and Tivoli Industries, Inc., and as trustee of the Blanchard Group of Funds. He is a Certified Public Accountant.

Christopher J. Renwick

Appointed as a Director in June 2007. Chairman of the Safety, Health, Environment & Community Committee and member of the Finance & Investment Committee. Mr. Renwick was employed with the Rio Tinto Group for over 35 years rising, in 1997, to Chief Executive, Rio Tinto Iron Ore, a position he held until his retirement in 2004. He is Chairman and Director of Coal and Allied Industries Limited (since 2004), a Director of Downer EDI Limited (since 2004), member of the board of Governors of Ian Clunies-Ross Foundation (since 2005) and chairman of the Rio Tinto Aboriginal Fund (since 2004).

Former Directors

Jeremy L. Sutcliffe

Mr. Sutcliffe served as an Executive Director from 2002 until August 26, 2009. He joined Sims in 1990 and held various senior executive positions, including Chief Executive UK, before assuming the position of Group Chief Executive in March 2002, a position he held until March 2008. As contemplated by the March 2008 Metal Management merger, Mr. Dienst, the former CEO and President of Metal Management, became the Group Chief Executive Officer of Sims initially with primary responsibility for North American operations, while Mr. Sutcliffe continued to manage the remainder of Sims’ operations for a transitionary period. As a result of the efforts of Messrs. Dienst and Sutcliffe, the integration and transition of key operational responsibilities was completed successfully and ahead of schedule. Mr. Sutcliffe’s contract term was set to expire on October 31, 2010, but due to the early completion of the integration and transition, Mr. Sutcliffe’s contract was terminated on August 26, 2009 and a mutually agreed settlement on remaining payments and obligations was reached.

Ross B. Cunningham

Mr. Cunningham served as Executive Director, Group Finance & Strategy from 1984 until his retirement from the Board on November 21, 2008. He joined Sims in 1967 and has held various senior positions in Australia and South-East Asia, including General Manager, NSW and General Manager, Finance & Administration.

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John T. DiLacqua

Mr. DiLacqua served as an Independent Non-Executive Director from March 2008 until his retirement from the Board on November 21, 2008. He was formerly a director (since June 2001) of Metal Management, which merged with Sims in March 2008.

Executive Officers

Set forth below is information regarding our executive officers as of October 1, 2009:

Name and Age	Title
Robert Larry, 48	Group Chief Financial Officer
Graham Davy, 44	CEO — European Metals and Sims Recycling Solutions — Global Operations
Robert Kelman, 46	President — Commercial, North America
Darron McGree, 62	Managing Director — Australia and New Zealand
Alan Ratner, 58	President — Operations, North America

Robert Larry

Group Chief Financial Officer since March 2008. Executive Vice President and Chief Financial Officer of Metal Management from August 1996 to March 2008. Treasurer of Metal Management from September 2004 to March 2008.

Graham Davy

CEO — European Metals and Sims Recycling Solutions — Global Operations since October 2006. Has been employed by the Group in various capacities since September 1988, including establishing the SRS business in 2002.

Robert Kelman

President — Commercial, North America since March 2008. President and Chief Operating Officer of Sims Group USA Holdings from 2007 to March 2008. Vice President and General Manager of Northeast Metals Operations of Sims Group USA since 2005. Prior to that time, he was the Senior Vice President and General Manager of Hugo Neu Schnitzer East, a joint venture between Hugo Neu Corporation and Schnitzer Steel, since 1997.

Darron McGree

Managing Director of Sims Group Australia Holdings Limited since 2005. Prior to that time, held various senior management positions with Sims since joining the company in 1983.

Alan Ratner

President — Operations, North America since March 2008. President of Metal Management Northeast, Inc. from 2001 to March 2008.

Former Executive Officers

Tom Bird

Mr. Bird resigned in August 2009. He previously served as Managing Director — Metals Recycling — United Kingdom.

B. Compensation

The following section reports the remuneration to our Board and describes our compensation policies and actual compensation for our executive officers as well as our use of equity incentives.

Director Compensation

Non-executive directors, or NEDs, receive an annual fee, paid monthly or quarterly, for their services. No additional fees are paid to NEDs for attending Board or committee meetings. NED fees are

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made up of a base fee and fees (as applicable) for chairmanship of the Board and committees as outlined in the table below.

NED fees in A$ (effective July 1, 2008)
Base fee (Chairman)	433,200
Base fee (Non-executive Director)	195,600
Chairman Risk, Audit & Compliance Committee	60,000
Chairman Safety, Health, Environment & Community Committee	30,000
Chairman Remuneration Committee	30,000
Chairman Finance & Investment Committee	30,000
Chairman Nomination/Governance Committee	—

In October 2009, the Board approved the payment of a fee of A$30,000 per annum, effective from November 1, 2009, to the Chairman of the Nomination/Governance Committee. The Board has otherwise resolved that there will be no increase in individual NED fees for fiscal 2010. NEDs are not currently covered by any contract of employment and, therefore, have no contract duration, notice period for termination or entitlement to termination payments. NEDs do not participate in any incentive (cash or equity-based) arrangements. NEDs also receive reimbursement for reasonable travel, accommodation and other expenses incurred in traveling to or from meetings of the Board or when otherwise engaged in the business of the Company in accordance with Board policy.

NEDs may participate in the Sims Metal Management Deferred Tax Director and Employee Share Plan (“NED Plan”). Under the NED Plan, a NED agrees to contribute a nominated percentage of the annual fees he receives from us to fund the acquisition of our shares by the NED Plan trustee.

Our NEDs’ Retirement Allowance Scheme was discontinued effective June 30, 2006. The accrued amounts in respect of the remaining NEDs who had participated (Messrs. Mazoudier and Feeney) were frozen and have been indexed at 5% per annum until payment. For Australian resident NEDs, we withhold 9% of their fees and contributes on behalf of each such NED to a complying superannuation fund, as required by legislation.

The following table sets forth the total remuneration paid to NEDs in fiscal 2009. Fees that were paid in US dollars were converted at a rate of A$1 to US$.9626 and fees paid in Japanese Yen were converted at a rate of A$1 to ¥ 101.04, both being the exchange rates set by the Board in July 2008. For NEDs who receive payments in foreign currencies, the tables below reflect the Australian dollar equivalent of the fees paid to each such NED based on the exchange rate at the date of payment. For information with respect to the Sims shares and equity awards held by members of the Board, please see “Item 6.E Share Ownership” below.

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Name	Short-term benefits	Post-employment benefits	Post-employment benefits	Share-based payments NED Share Plan	Total
	Cash Fees4	Super- annuation	Retirement benefits
			(in A$)
P Varello1	284,897	—	—	—	284,897
N Bobins1	284,897	—	—	—	284,897
J DiLacqua1,2	87,768	—	—	—	87,768
M Feeney	173,504	17,389	21,096	19,708	231,697
M Iwanaga3	293,526	—	—	—	293,526
R Lewon1	247,013	—	—	—	247,013
P Mazoudier	397,432	35,769	45,636	—	478,837
G Morris1	322,782	—	—	—	322,782
C Renwick	167,351	18,628	—	39,622	225,601

1 — Messrs. Bobins, DiLacqua, Lewon, Morris and Varello are residents of the United States and receive their payments in US dollars.

• 2

• Mr. DiLacqua retired from the Board on November 21, 2008.

• 3

• Mr. Iwanaga is a resident of Japan and receives his payments in Japanese Yen.

• 4 — Figure shown is after fee sacrifice to either superannuation and/or NED Share Plan.

Executive Officer Compensation

The following table sets forth remuneration paid to our executives in fiscal 2009. Certain executive directors and executive officers are not residents of Australia. Their respective remuneration paid in foreign currency has been converted to Australian dollars at an average exchange rate for the year. For information with respect to the Sims shares and equity awards held by executive officers, please see “Item 6.E — Share Ownership” below.

Name	Salary1	Cash Bonus	Other2	Superannu- Other ation/retirement long-term benefits benefits3 (in A$)	Other long-term benefits3	Termination benefits	Termination benefits	Share- based pay- ments4	Total
D Dienst5	1,328,038	2,665,438	195,796	— 15,915			—	1,357,334	5,562,521
J Sutcliffe6	1,347,284	2,630,160	144,071	219,798 43,554		—		(613,272)	3,771,595
R Cunningham7	255,915	192,545	2,809	51,550 26,437			3,130,316	364,243	4,023,815
T Bird5, 8	451,112	272,664	41,441	42,631 28,229		—		476,240	1,312,317
G Davy5	584,198	440,969	41,441	42,631 —			—	765,199	1,874,438
R Kelman5	835,875	1,221,782	43,031	15,373 —		—		682,840	2,798,901
R Larry5	835,875	417,938	50,068	— 15,915			—	398,833	1,718,629
D McGree	536,651	315,870	17,513	105,772 20,379		—		578,093	1,574,278
A Ratner5	835,875	1,434,696	36,683	— 15,915			—	1,098,471	3,421,640

• 1 — Cash salary includes amounts sacrificed in lieu of other benefits at the discretion of the individual.

• 2

• 3

• Other short-term benefits include auto allowances, health and life insurance benefits, and amounts accrued for annual leave during the period. The amount for Mr. Dienst also includes payments for personal security.

• Other long-term benefits include amounts accrued for cash-based long term incentive plans, long-service leave and deferred compensation plans.

• 4 — Share-based payments represent the accounting expense (as computed pursuant to AASB 2, “ Share-based Payments ”) recognized by us for share-based awards. Certain share-based awards made in the 2007 and 2008 fiscal years only vest upon satisfaction of nonmarket based performance hurdles. These performance hurdles are not expected to be achieved and therefore previously recognized share-based payments have been reversed in the 2009 fiscal year and results in a reduction in total 2009 remuneration for the impacted individuals.

• 5 — Messrs. Dienst, Kelman, Larry and Ratner are residents of the United States and receive their cash payments in US dollars.

• Messrs. Bird and Davy are residents of the United Kingdom and receive their cash payments in pound sterling.

• 6

• Mr. Sutcliffe’s employment was terminated by way of redundancy on August 26, 2009.

• 7

• Mr. Cunningham retired on November 21, 2008. Termination benefits represent payments for severance, but do not include payments for unused leave as these accruals were previously disclosed as remuneration. In addition, share-based payments for Mr. Cunningham in 2009 represent the acceleration of expense for awards which have not yet vested, but contain “good-leaver” provisions.

• 8 — Mr. Bird resigned on August 17, 2009.

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Short-term Incentive Plan (“STI Plan”)

The design and implementation of an STI Plan in fiscal 2009 was delayed by the complexities of the integration and transition of key operational responsibilities following the March 2008 merger with Metal Management. However, in order for us to ensure retention of key executives during the integration, as well as reward the extraordinary effort of participants in combining two large companies quickly and smoothly during difficult economic conditions, the Remuneration Committee approved a “bridge” bonus payment, in lieu of a formal STI Plan, for performance over the first half of fiscal 2009. The “bridge” plan covered executive directors, executive officers and all other employees who received a maximum bonus under the STI Plans of both former companies in fiscal 2008.

In fiscal 2008, each of the former Sims Group Limited and Metal Management paid out maximum STIs to its respective participants. For former Metal Management participants, the maximum STI payment was two times target; for former Sims Group Limited participants, the maximum STI payment was three times target. To calculate the basis of a participant’s potential “bridge” payment, a two times target maximum was applied to his or her fixed remuneration at the start of fiscal 2009; the actual “bridge” payment, being only for a six-month period, was capped at 50% of the calculated amount.

By the beginning of the second half of fiscal 2009, it was apparent that there was no reasonable return on net assets target that would support an STI Plan payout for the balance of the fiscal year. Therefore, there was no STI Plan established for the second half of fiscal 2009, and no further STI payments beyond the “bridge” payment described above were made to executive directors and executive officers.

Integration bonuses

The employment agreements between us and each of Messrs. Dienst and Sutcliffe included the provision for payment of a one-time integration bonus of up to US$1 million to each of them, payable upon the completion of the transition activities consequent to the March 2008 Metal Management merger. The integration bonuses were originally anticipated to be paid in August 2009, upon the successful completion of integration objectives established by the Integration Committee of the Board. The Integration Committee determined that the integration objectives were completed successfully and ahead of schedule and, as a result, the Board approved early payment of the maximum integration bonus to each of Messrs. Dienst and Sutcliffe in April 2009.

The focus of the integration efforts was in North America, where both the former Sims Group Limited and Metal Management had important business operations. Key to the success of the integration was the efforts of the co-presidents of North America, Messrs. Kelman and Ratner. In recognition of their contributions, the Board approved a one-time integration bonus, consisting of US$500,000 cash and US$250,000 in ADSs each to Messrs. Kelman and Ratner. The payments were made in December 2008.

Share-based Plan Awards

During fiscal 2009, the following grants of options were made to executive officers. The options vest equally over three years beginning on August 31, 2009.

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Name	Grant date	Number granted	Exercise price	Exercise price	Expiry date
Ordinary shares (A$)
J Sutcliffe1	November 24, 2008	135,435	$13.11		November 24, 2015
T Bird2	April 2, 2009	39,347	$ 17.79		April 2, 2016
G Davy	April 2, 2009	48,950	$17.79		April 2, 2016
D McGree	April 2, 2009	47,534	$ 17.79		April 2, 2016
ADS (US$)
D Dienst	November 24, 2008	181,654	$ 8.39		November 24, 2015
R Kelman	April 2, 2009	87,664	$12.19		April 2, 2016
R Larry	April 2, 2009	109,580	$ 12.19		April 2, 2016
A Ratner	April 2, 2009	87,664	$12.19		April 2, 2016

1 — Mr. Sutcliffe’s agreement was terminated by way of redundancy on August 26, 2009. As a result of “good-leaver” provisions in the option agreement, he will continue to vest in the option grant.

2

—

Mr. Bird resigned on August 17, 2009 and as a result, the above award was forfeited.

During fiscal 2009, the following grants of performance rights were made to executive officers. The performance rights will vest on August 31, 2011 subject to the achievement of a total stockholder return over a three-year period commencing on July 1, 2009.

Name	Date of Grant	Number of Rights
D Dienst	November 24, 2008	61,092
J Sutcliffe1	November 24, 2008	44,440
T Bird2	April 2, 2009	14,720
G Davy	April 2, 2009	18,312
R Kelman	April 2, 2009	38,580
R Larry	April 2, 2009	48,225
D McGree	April 2, 2009	16,313
A Ratner	April 2, 2009	38,580

1 — Mr. Sutcliffe’s agreement was terminated by way of redundancy on August 26, 2009. As a result of “good-leaver” provisions in the performance right agreement, he will continue to vest in the performance right grant.

2

—

Mr. Bird resigned on August 17, 2009 and as a result, the above award was forfeited.

For additional information on our share-based plans, refer to Note 24 of the consolidated financial statements included in Item 18 of this annual report.

C. Board Practices

Under our constitution, the Board is required to be comprised of at least six directors. Under our Board Charter, a majority of directors, including the Chairperson of the Board, must be independent. The Chairperson must not also be the Group Chief Executive Officer or other officer or employee of Sims or of any of its consolidated subsidiaries.

In accordance with the Listing Rules of the ASX, directors (other than the Group Chief Executive Officer) appointed to fill a casual vacancy or as an addition to the Board must stand for re-election at the next following annual general meeting of the listed company, and directors serve three-year terms and are eligible for re-election to further three-year terms.

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Committees of the Board

The Board has established five committees to assist in the execution of Board functions, namely, a Remuneration Committee, a Risk, Audit & Compliance Committee, a Safety, Health, Environment & Community Committee, a Nomination/Governance Committee and a Finance & Investment Committee. Although the Board may delegate powers and responsibilities to these committees, the Board retains ultimate accountability for discharging its duties. Descriptions of the current roles and responsibilities of these committees are set out below.

Remuneration Committee

The Remuneration Committee of the Board is comprised of at least three directors, with a majority being independent. The current members of the Remuneration Committee are J. Michael Feeney (Chair), Paul K. Mazoudier, and Gerald E. Morris.

The primary role of the Remuneration Committee is to support and advise the Board on the implementation and maintenance of coherent, fair and responsible remuneration policies which are observed and which enable us to attract and retain executives and directors who will create value for shareholders.

Risk, Audit & Compliance Committee

The Risk, Audit & Compliance Committee, or RAC, is comprised of at least three directors, each of whom must be independent. All RAC members must be financially literate and have an understanding of the industry in which we operate. At least one member must have accounting or related financial management expertise, either as being a qualified accountant, or other financial professional with experience of financial and accounting matters. The current members of the RAC are Gerald E. Morris (Chair), J. Michael Feeney, and Paul K. Mazoudier.

The primary role of the RAC is to assist the Board in fulfilling its corporate governance and oversight responsibilities in relation to Sims accounting and financial reporting, internal control structure, risk management systems (including the review of risk mitigation, which includes insurance coverage), the internal and external audit functions, and compliance with legal and regulatory requirements.

The RAC is also required to pre-approve all audit and non-audit services (including valuation, internal audit, legal and corporate services) provided by the external auditors and not engaging the external auditors to perform any non-audit/assurance services that may impair or appear to impair the external auditors’ judgment or independence in respect of Sims or that violate the prohibitions on non-audit services provided in Sections 201 and 202 of the Sarbanes-Oxley Act of 2002 or the auditor independence rules or interpretations of the SEC or the United States Public Company Accounting Oversight Board.

Safety, Health, Environment & Community Committee

The Safety, Health, Environment & Community Committee, or SHEC, is comprised of at least three directors, of whom one at least must be independent. The current members of the SHEC are Christopher J. Renwick (Chair), Daniel W. Dienst, Robert Lewon, and Paul K. Mazoudier.

The SHEC provides additional focus and advice to the Board on key safety, health, environment and community issues. The SHEC assists the Board to fulfill and discharge its SHEC obligations. The main role and function of the SHEC is to:

• Following receipt of a recommendation from the Sims SHEC Executive Committee, recommend to the Board for adoption the SHEC standards and policy across Sims global business.

• Monitor and review reports from the Sims SHEC Executive Committee on the effectiveness of the SHEC standards, policy and management systems across Sims global business.

• Liaise with and receive advice from the Sims SHEC Executive Committee on key SHEC issues.

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• Report to the Board on key SHEC issues.

Nomination/Governance Committee

The Nomination/Governance Committee is comprised of at least three directors, with a majority being independent. The current members of the Nomination/Governance Committee are Robert Lewon (Chair), Paul J. Varello, J. Michael Feeney, Daniel W. Dienst, and Gerald E. Morris.

The primary role of the Nomination/Governance Committee is to support and advise the Board in fulfilling its responsibilities to shareholders of the company in having a Board comprising individuals who are best able to discharge the responsibilities of directors.

Finance & Investment Committee

The Finance & Investment Committee, or FIC, is comprised of at least three directors of whom one at least shall be independent. The current members of the FIC are Norman R. Bobins (Chair), Daniel W. Dienst, Robert Lewon, Christopher J. Renwick and Paul J. Varello.

The role of the FIC is to review, advise and report to the Board on the management of our financial resources and invested assets, shareholder dividend policy and shareholder dividends, our capital plan and capital position, debt levels, hedging policies and other financial matters. The FIC also reviews broad investment policies and guidelines for us and our subsidiaries and makes recommendations to the Board.

D. Employees

We had 5,533 employees as of June 30, 2009. The table below sets forth the total number of employees by geography segment for the past three years.

			**As **	of June 30,
		2009		2008		2007
Australasia		945		1,099		985
North America		3,248		3,574		1,414
Europe		1,340		1,312		1,024
Total employees		5,533		5,985		3,423

The decrease in the number of employees from June 30, 2008 to June 30, 2009 is a result of company-wide cost rationalization measures. The increase in the number of employees from June 30, 2007 to June 30, 2008 primarily was a result of the March 2008 Metal Management acquisition.

We have a mix of collective “at will” and individually negotiated employment arrangements throughout North America, Australasia and Europe. Whatever the nature of those arrangements, we recognize the right of our employees to freely associate and to join or not join unions.

In locations where our employees are represented by unions, we work closely with the unions to maintain positive labor relations. We had no significant strikes or other industrial actions during fiscal 2009 and successfully renegotiated the collective bargaining agreements that expired during the fiscal year. We believe that successful relations with all our employees, unionized and non-unionized, must be built on values of mutual trust and respect.

Management believes that we have a good relationship with our employees and with the labor unions.

E. Share ownership

Details regarding share ownership, as well as potential ownership interest through holding of equity-based incentives, of the members of our Board and our executive officers are set forth in Note 24 of the consolidated financial statements included in Item 18 of this annual report.

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Item 7. Major Shareholders and Related Party Transactions

A. Major shareholders

As of October 14, 2009, to the knowledge of Sims, the following persons, having provided us with substantial shareholder notices in accordance with the Corporations Act of Australia, beneficially owned 5% or more of Sims ordinary shares:

Principal Beneficial Shareholders	Number of Shares	Percentage
Mitsui Raw Materials Development Pty Limited	34,649,903	19.00 %
M & G Investment Funds	21,968,173	12.05%
Legg Mason Asset Management Limited	13,892,429	7.62 %

As of October 14, 2009, the following persons were registered at Sims’ share registry as holding 5% or more of Sims ordinary shares:

Principal Registered Shareholders	Number of Shares	Percentage
National Nominees Limited	34,685,055	19.02 %
Mitsui Raw Materials Development Pty Limited	33,486,787	18.36%
HSBC Custody Nominees (Australia) Limited	31,222,919	17.12 %
J.P. Morgan Nominees Australia Limited	19,876,791	10.90%

Shareholders of the company do not have different voting rights. Mitsui Raw Materials Development Pty Limited holds approximately 19% of the outstanding ordinary shares of Sims and is our largest shareholder. Under our constitution, Mitsui & Co., Ltd and any of its related corporate bodies, which are collectively referred to as Mitsui, have the right to designate a representative director to serve on our Board so long as Mitsui holds 5% or more of Sims ordinary shares and, so long as Mitsui holds 15% or more of Sims ordinary shares, then Mitsui has the right to designate both a representative director and an independent director to serve on our Board. Currently, Mr. Iwanaga is Mitsui’s designated representative director and Mr. Renwick is Mitsui’s designated independent director.

As of June 30, 2009, there were 182,227,569 ordinary shares outstanding, of which 5,607,245 ordinary shares were held by 42 registered holders with a registered address in the United States and 30,838,689 ADSs were held by 257 registered holders with a registered address in the United States. Since certain of the ordinary shares and ADSs were held by brokers and nominees, the number of record holders in the United States may not be representative of the number of beneficial holders or of where the beneficial holders are resident.

B. Related party transactions

Transactions with related parties that are material to us or to a related party are presented in Note 30 of our consolidated financial statements included in Item 18 of this annual report.

C. Interests of experts and counsel

Not applicable.

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Item 8. Financial Information

A. Consolidated Statements and Other Financial Information

Our consolidated financial statements are set out on pages F-1 to F-77 of this annual report (refer to “Item 18 Financial Statements”).

Export Sales

The total amount of sales made outside of Australia in fiscal 2009 was A$8.2 billion which represented 94% of total sales of A$8.6 billion.

Legal Proceedings

Various claims and legal actions are pending against us in respect of contractual obligations and other matters arising out of the conduct of our business. Appropriate provision has been recorded for the estimated loss on claims and legal actions. In the opinion of management, any liability will not materially affect our consolidated financial position, results of operations, or cash flows.

Dividend Policy

Under our constitution, our Board may, from time to time, determine that a dividend is payable to our shareholders. Subject to our constitution, the Corporations Act, the listing rules of the ASX and the rights of holders of shares with special rights as to dividends, dividends are to be apportioned and paid among our shareholders in proportion to the amounts paid up (not credited) on the shares held by the shareholders. In relation to partly paid shares, any amount paid on a share in advance of a call will be ignored when calculating the relevant proportion. We presently expect to continue to pay dividends in the future. The total amounts of future dividends will be determined by our Board and will depend on our profit after tax, cash flow, financial and economic conditions and other factors. We have expressed an intention to maintain a dividend payout ratio of between 45% and 55% of profit after tax.

The Corporations Act and our constitution provide that no dividend is payable except out of our profits. Our constitution provides that the declaration of the Board as to the amount of profits is conclusive. Under Australian law, the term “profits” has a particular legal meaning that broadly requires ensuring that the past fiscal year’s retained earnings (deducting any current fiscal year losses) are sufficient to satisfy the dividend amount payable.

The Board may deduct from any dividend payable to a shareholder all sums of money presently payable by the shareholder to Sims on account of calls on shares held by it or otherwise.

Except as otherwise provided by law, all dividends unclaimed for one year after having been declared may be invested or otherwise made use of by Board for the benefit of Sims until claimed.

In addition, we have adopted a dividend reinvestment plan, which permits eligible participants to elect to be issued Sims ordinary shares in lieu of a cash dividend for some or all of their Sims ordinary shares.

B. Significant Changes

In November 2009, we amended the documentation applicable to the facilities of each of our bank credit providers. See “Item 5B Operating and Financial Review and Prospects – Liquidity and Capital Resources.” Any other significant changes that have occurred since June 30, 2009 are presented in Note 34 of our consolidated financial statements included in Item 18 of this annual report.

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Item 9. The Offer and Listing

A. Offer and Listing Details

Our capital consists of ordinary shares traded on the ASX under the symbol “SGM.” ADSs, each representing one ordinary share, are traded on the NYSE under the symbol “SMS.” The ADSs are evidenced by American Depositary Receipts, or ADRs, issued by Bank of New York Mellon, as depositary under the Amended and Restated Deposit Agreement dated as of March 14, 2008, among Sims, Bank of New York Mellon and registered holders from time to time of ADRs. The ADSs began trading on March 17, 2008.

The table below sets forth, for the periods indicated, the reported high and low quoted prices for our ordinary shares on the ASX and the reported high and low quoted prices for the ADSs on the NYSE.

	ASX Price per share A$ High Low	ASX Price per share A$ High Low	NYSE Price per share US$	NYSE Price per share US$
	High		High	Low
Year ended June 30, 2009:
First Quarter	43.20	27.22	41.49	20.00
Second Quarter	29.99	10.68	23.37	6.97
Third Quarter	20.61	14.44	14.87	9.39
Fourth Quarter	27.19	16.90	22.78	11.90
Year ended June 30, 2008:
First Quarter	34.28	23.59	n/a	n/a
Second Quarter	32.40	25.05	n/a	n/a
Third Quarter	34.67	24.00	31.12	23.70
Fourth Quarter	42.41	29.62	40.99	27.25
Year ended June 30, 2007	28.65	22.62	n/a	n/a
Year ended June 30, 2006	20.60	14.03	n/a	n/a
Year ended June 30, 2005	19.25	11.36	n/a	n/a
Most recent six months:
October 2009	24.00	19.38	22.11	17.11
September 2009	24.40	22.21	21.02	18.57
August 2009	27.98	22.10	23.74	19.07
July 2009	29.15	23.28	23.52	18.21
June 2009	27.19	22.37	22.78	17.75
May 2009	23.75	19.88	18.83	14.69

B. Plan of Distribution

Not applicable.

C. Markets

The principal trading markets for our shares are the ASX, in the form of ordinary shares, and the NYSE, in the form of ADSs.

D. Selling Shareholders

Not applicable.

E. Dilution

Not applicable.

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F. Expenses of the Issue

Not applicable.

Item 10. Additional Information

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

General

We are a public company limited by shares registered under the Corporations Act by the Australian Securities and Investments Commission, or ASIC. Our registered company number is 114 838 630. Our constitution does not specify the objects and purposes of the company. The rights of our shareholders are set forth in our constitution, which is similar in nature to the certificate of incorporation and bylaws of a company incorporated under state corporation laws in the United States. Our constitution is subject to the terms of the listing rules of the ASX and the Corporations Act. Our constitution may be amended or repealed and replaced by special resolution of shareholders, which is a resolution passed by at least 75% of the votes cast by shareholders entitled to vote on the resolution.

Our current constitution was adopted on October 21, 2005 and was amended on November 21, 2007. Under Australian law, a company has the legal capacity and powers of an individual both inside and outside Australia. The material provisions of our constitution are summarized below. This summary is not intended to be complete, nor does it provide a definitive statement of the rights and liabilities of our shareholders and is qualified in its entirety by reference to the constitution filed as Exhibit 1.1 hereto.

Directors

Our constitution provides for a minimum of six directors. Under the listing rules of the ASX, our directors are elected for three year terms and must retire from office or seek re-election by no later than the third annual general meeting following such director’s election or three years, whichever is longer. Our Group Chief Executive Officer, Daniel W. Dienst, is not subject to this obligation while he serves in such position.

The number of directors up for election at an annual general meeting depends upon the number of directors due to retire or seek re-election that year. However, our constitution provides that, unless otherwise determined by a resolution of our Board while Sims is listed on the ASX, at least one director must retire from office at each annual general meeting, unless there has been an election of directors earlier that year. If no director is required to retire at the annual general meeting due to having been in office for three years or due to being appointed that year, the director required to retire will be the one who has been longest in office since his or her last election.

Directors are elected by an ordinary resolution of the holders of our ordinary shares and ADSs. However, the Board has the power to appoint any other person as a director either to fill a casual vacancy (on retirement of a director or where the maximum allowable number of directors has not been appointed). Directors appointed in this manner must retire from office (and will be eligible for re-election) at the next annual general meeting. The constitution contains no age limit requirements for the retirement or non-retirement of directors and does not require a director to hold shares in Sims.

Subject to the Corporations Act and the listing rules of the ASX, neither a director nor his or her alternate may vote at any Board meeting about any contract or arrangement in which the director has, whether directly or indirectly, a material personal interest. However, that director may execute or otherwise act in respect of that contract or arrangement. Any director who has a material personal interest in a matter that relates to the company’s affairs must give the other directors notice of that interest, unless the interest is of a type referred to in section 191(2) (a) of the Corporations Act, or all of the conditions

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referred to in section 191(2)(c) of the Corporation Act are satisfied. The director must declare the nature and extent of the director’s interest and the relation of the interest to the company’s affairs at a Board meeting as soon as possible after the director becomes aware of his or her interest in the matter. A director who has an interest in a matter may give a standing notice to the other directors of the nature and extent of that director’s interest in the matter in accordance with section 192 of the Corporations Act. Any director who holds any office or possesses any property whereby the holding or possession might (whether directly or indirectly) create conflicting duties or interests with those as a company director must declare the fact of holding that office or possessing that property, and the nature and extent of any conflict, at the first Board meeting held after he or she becomes a director or (if already a director) at the first Board meeting held after he or she becomes aware of the relevant facts.

We may in general meeting, from time to time, determine the maximum aggregate cash remuneration to be paid to the non-executive directors for services rendered as directors. In fiscal 2009, the maximum aggregate remuneration was A$2.5 million. At our 2009 AGM to be held on November 20, 2009, we have asked shareholders to approve an increase in the maximum aggregate remuneration to A$3.0 million. The directors may divide the remuneration among themselves in any proportions and in any manner as they may from time to time determine. If the directors do not or are unable to agree as to the apportionment of the remuneration, it will be divided among them equally. If any director performs extra services or makes special exertions (at the Board’s request), such as going or living abroad, serving on any Board committee, or otherwise for any company purpose, we may remunerate that director by paying for those services and exertions.

The directors may, from time to time, at their discretion, cause the company to borrow or raise any sum or sums of money or obtain other financial accommodation for company purposes and may grant security for the repayment of that sum or sums or the payment, performance or fulfillment of any debts, liabilities, contracts or obligations incurred or undertaken by the company in any manner and on any terms and conditions as they think fit and in particular by the issue or re-issue of bonds, perpetual or redeemable debentures or any mortgage, charge or other security on the undertaking or the whole or any part of the property of the company (both present and future) including its uncalled or unpaid capital for the time being.

Rights and Restrictions on Classes of Shares

The rights of holders of our ordinary shares are governed by the Corporations Act, our constitution, the listing rules of the ASX and Australian law. Our constitution provides that we may issue preference, deferred, or non-voting shares, whether in relation to dividends, voting, return of share capital, payment of calls or otherwise as the Board may determine from time to time.

Our constitution provides that, subject to the Corporations Act and the listing rules of the ASX, all or any of the rights and privileges attached to any class of shares (unless otherwise provided by the terms of issue of the shares of that class) may be varied or cancelled, including by converting or reclassifying shares from one class to another (i) with the written consent of holders of at least 75% of the shares issued in such class; or (ii) with the approval of a special resolution passed at a meeting of holders of the shares of such class.

Dividend Rights

Under our constitution, the Board may, from time to time, determine that a dividend is payable to our shareholders. Subject to our constitution, the Corporations Act, the listing rules of the ASX and the rights of holders of shares with special rights as to dividends, dividends are to be apportioned and paid among our shareholders in proportion to the amounts paid up (not credited) on the shares held by the shareholders. In relation to partly paid shares, any amount paid on a share in advance of a call will be ignored when calculating the relevant proportion.

The Corporations Act and our constitution provide that no dividend is payable except out of our profits. Our constitution provides that the declaration of the Board as to the amount of our profits is

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conclusive. Under Australian law, the term “profits” has a particular legal meaning that broadly requires ensuring that the accumulated retained earnings of prior fiscal years (deducting any current fiscal year losses) are sufficient to satisfy the dividend amount payable.

Voting Rights

Our constitution provides that, generally, each shareholder has one vote on a show of hands and, on a poll, one vote for each ordinary share fully paid and, if not fully paid, a fraction of a vote equivalent to the proportion of the ordinary share paid up.

A shareholder may not vote at any general meeting in respect of ordinary shares it holds on which calls or other moneys are due and payable to Sims at the time of the meeting. However, a shareholder holding ordinary shares on which no calls or other moneys are due and payable to Sims is entitled to receive notices of, and to attend, any general meeting and to vote and be counted in a quorum even though that shareholder has moneys then due and payable to Sims in respect of other ordinary shares which that shareholder holds.

Joint holders of our ordinary shares may vote at any shareholders’ meeting either personally or by proxy or by attorney or representative in respect of those ordinary shares as if they were solely entitled to those ordinary shares. If more than one joint holder votes, then the vote of the joint holder whose name appears first on the register will be counted.

Preemptive Rights

Preemptive rights on transfers of shares are not applicable to listed companies in Australia. ASX listing rule 7.1 provides the extent to which listed companies can place shares without offering them to existing shareholders on a rights basis. Generally, placements are limited to 15% of the company’s outstanding share capital in any rolling 12-month period.

Liability to Further Calls

The Board may make calls on the shareholders as it deems fit for all moneys unpaid on shares held by such shareholders which are not moneys made payable by the conditions of allotment at fixed times. A call is deemed to have been made when the board resolution authorizing such call was passed. A call may be made payable by installments. The Board may revoke or postpone a call.

We must give written notice of a call at least 30 business days before such call is due. The notice must specify the time and place for payment and any other information required by the listing rules of the ASX. The non-receipt of any notice by, or the accidental omission to give notice of any call to, any shareholder will not invalidate the call.

The directors may, on the issue of shares, differentiate between the shareholders as to the amount of calls to be paid and the time for payment of those calls. Any sum which, by the terms of issue of a share, becomes payable on allotment or at any fixed date, will for the purposes of Sims’s constitution be deemed to be a call duly made and payable on the date on which the sum is payable. In case of nonpayment, all the relevant provisions of our constitution as to payment of interest and expenses, forfeiture or otherwise will apply as if the sum had become payable by virtue of a call duly made and notified.

A sum called in respect of a share and not paid on or before the date for payment bears interest from the date for payment to the time of actual payment at any rates as the Board may determine. The Board may waive payment of interest, either in whole or in part.

Liquidation Rights

In a winding up, any assets available for distribution to shareholders will, subject to the rights of the holders of shares issued on special terms and conditions, our constitution, the Corporations Act and the listing rules of the ASX, be distributed amongst the shareholders in proportion to the capital paid up

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on their shares and any surplus distributed in proportion to the amount paid up (not credited) on shares held by them.

We cannot pay any director or liquidator any fee or commission on the sale or realization of the whole or part of Sims’s undertaking or assets without shareholders’ approval. Such approval must be given at a general meeting convened by notice specifying the fee or commission proposed to be paid.

If Sims is wound up, whether voluntarily or otherwise, the liquidator may (i) with the shareholders’ approval via a special resolution, divide among the contributories in specie or kind any part of the assets of Sims; (ii) with the shareholders’ approval via a special resolution, vest any part of the assets of Sims in trustees of trusts for the benefit of the contributories or any of them as the liquidator deems appropriate; and (iii) determine the values it considers fair and reasonable on any property to be divided and determine how the division is to be carried out.

Annual General Meetings and General Meetings of Shareholders

Under the Corporations Act and our constitution, there are two types of shareholders’ meetings: annual general meetings and general meetings. Annual general meetings, under the Corporations Act, are required to be held at least once every calendar year and within five months after the end our fiscal year.

General meetings of shareholders may be called by Board. Under the Corporations Act, notice of a general meeting must be given to our shareholders at least 28 days before the date of such general meeting. The notice must specify the date, time and place of the general meeting and state the general nature of the business to be transacted at the general meeting. Under the Corporations Act, a general meeting of shareholders may be called by shareholders holding at least 5% of the total votes that may be cast at the meeting or at least 100 shareholders who are entitled to vote. A quorum for a general meeting is three shareholders.

All shareholders are entitled to attend annual general meetings and general meetings, in person or by proxy, attorney or corporate representative.

Foreign Ownership Regulation

Except for the provisions of the Foreign Acquisitions and Takeovers Act 1975 which impose certain conditions on, or approvals in respect of, the foreign ownership of Australian companies, there are no limitations imposed by law, or our constitution, on the rights of non residents or foreign persons to hold or vote the ordinary shares or Sims ADSs that would not apply generally to all shareholders.

Restrictions on Takeovers

The Corporations Act places restrictions on the acquisition of greater than 20% of Sims’s issued voting shares (or where a shareholder’s voting power, whose voting power was already above 20% but below 90%, increases in any way). Such acquisitions must comply with certain prescribed exceptions to these restrictions set forth in the Corporations Act. For instance, such an acquisition may be made under a takeover offer made to all shareholders on the same terms and which complies with certain timetable and disclosure requirements.

Generally, a company listed on the ASX may not acquire a substantial asset from, or dispose of a substantial asset to, a person who (together with associates) controls more than 10% of such company’s voting shares, or issue securities to a related party (generally connoting control of the company), unless such transaction has been approved by such company’s shareholders. The Corporations Act also imposes limitations on transactions between public companies and related parties which do not have shareholder approval (unless certain exceptions apply).

Clause 13 of our constitution, which relates to the making of proportional takeover bids, has lapsed by operation of the Corporations Act and it has no effect.

Ownership Threshold

There are no provisions in our constitution that require a shareholder to disclose ownership above a certain threshold. The Corporations Act, however, requires a substantial shareholder to notify us and the

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ASX once a 5% relevant interest in our voting shares is obtained. Further, once a shareholder owns a 5% relevant interest in us, such shareholder must notify us and the ASX of any increase or decrease of 1% or more in its holding of our voting shares or if it ceases to have relevant interest of at least 5%.

C. Material Contracts

The following are material contracts, other than contracts entered into the ordinary course of business, that we have entered into during the last two fiscal years.

Acquisition of Metal Management, Inc.

On March 14, 2008, MMI Acquisition Corporation, a wholly-owned subsidiary of Sims, merged with and into Metal Management. We issued 53,473,817 Sims ADSs to the former shareholders of Metal Management. The merger agreement is included as Exhibit 4.1 of this annual report.

Primary Credit Facilities Provided by CBA, WBC and BOA

A summary of the contracts governing Sims’ primary credit facilities provided by CBA, WBC and BOA is provided above in “Item 5B Operating and Financial Review and Prospects — Liquidity and Capital Resources.”

D. Exchange Controls

The Australian Banking (Foreign Exchange) Regulations and other Australian legislation and regulations control and regulate, or permit the control and regulation of, a broad range of payments and transactions involving non-residents of Australia. We are not restricted from transferring funds from Australia or placing funds to the credit of non-residents of Australia subject to:

• withholding for Australian tax due in respect of dividends (to the extent they are unfranked) and interest and royalties paid to nonresidents of Australia; and

• a requirement for approval from the Reserve Bank of Australia or in some cases the Minister for Foreign Affairs for certain payments or dealings in or out of Australia to or on behalf of:

• members of the previous government of Iraq, its senior officials and their immediate families;

• certain supporters of the former government of the Federal Republic of Yugoslavia;

• the Taliban or any undertaking owned or controlled directly or indirectly by the Taliban and certain other named terrorist organizations and individuals;

• certain ministers and senior officials of the Government of Zimbabwe;

• certain Burmese regime figures and supporters;

• certain entities associated with North Korea; or

• certain entities and persons associated with Iran.

This list is subject to change from time to time.

Accordingly, at the present time, remittance of dividends on our ordinary shares to the depositary is not subject to exchange controls.

Other than under the Corporations Act, the Australian Foreign Acquisitions and Takeovers Act (insofar as such laws apply) or as contained in associated Australian government policy (and except as otherwise described above), there are no limitations, either under Australian law or under our constitution on the right to hold or vote Sims ordinary shares.

E. Taxation

Australian taxation

The following discussion is a summary of certain Australian taxation implications of the ownership of ordinary shares (including American Depository Shares). The statements concerning Australian taxation set out below are based on the laws in force at the date of this annual report and the Convention between the Government of Australia and the Government of the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (the Tax Treaty), and are subject to any changes in Australian law and any changes in the Tax Treaty occurring after that date.

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The discussion is intended only as a descriptive summary and does not purport to be a complete analysis of all the potential Australian tax implications of owning and disposing of ordinary shares. The specific tax position of each investor will determine the applicable Australian income tax implications for that investor. We recommend each investor consult their own tax adviser concerning the implications of receiving dividends and owning and disposing of ordinary shares.

Taxation of dividends

Under the Australian dividend imputation system, Australian tax paid at the company level is imputed (or allocated) to shareholders by means of imputation credits which attach to dividends paid by the company to the shareholder. Such dividends are termed “franked dividends.”

While a company may only declare a dividend out of profits, the extent to which a dividend is franked depends in broad terms upon a company’s available franking credits and the nature of that dividend. Accordingly, a dividend paid to a shareholder may be wholly or partly franked or wholly unfranked.

Fully franked dividends paid to non-resident shareholders are exempt from Australian dividend withholding tax. Dividends that are not fully franked dividends are subject to withholding tax on the unfranked portion except to the extent that the dividend is declared to be “conduit foreign income” (in essence income and gains that have a foreign source from an Australian perspective which would include dividends received from non-Australian subsidiaries).

Dividends paid to non-resident shareholders which are not fully franked are subject to dividend withholding tax at the rate of 30% (unless reduced by a double tax treaty) to the extent they are unfranked and not paid out of conduit foreign income. In the case of residents of the United States, the rate is reduced to 15% under the Tax Treaty, provided the shares are not effectively connected with a permanent establishment or a fixed base of a non-resident in Australia through which the non-resident carries on business in Australia or provides independent personal services. Where a United States company holds directly at least 10% of the voting interest in the company paying the dividend, the withholding tax rate is reduced to 5%.

In the case of residents of the United States that have a permanent establishment or fixed base in Australia and the shares in respect of which the dividends are paid are attributable to that permanent establishment or fixed base, the dividends will not be subject to dividend withholding tax. Rather, such dividends will be taxed on a net assessment basis in Australia and, where the dividends are franked, entitlement to a tax offset against Australian income tax payable by the shareholder may arise to the extent of the franking credits.

There are rules where in certain circumstances a shareholder may not be entitled to the benefit of franking credits (i.e. the ability to claim a tax offset). The application of these rules will depend upon the shareholder’s own circumstances, including the period which the shares are held and the extent to which the shareholder is ‘at risk’ in relation to their shareholding. Shareholders will need to obtain their own advice in relation to these rules.

The company will send shareholders statements indicating the extent to which dividends are franked or paid out of conduit foreign income, and the amount of tax (if any) withheld.

A United States holder of ordinary shares (who is also not a tax resident of Australia and who does not hold ordinary shares as a business asset through a permanent establishment in Australia) with no other Australian source income is not required to file an Australian tax return.

Fully franked dividends paid to non-residents shareholders, dividends paid out of conduit foreign income or dividends subject to dividend withholding tax are not subject to any further Australian income tax.

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Gain or loss on disposition of shares

The Australian income tax treatment in respect of the disposition of shares will depend on whether the investor holds the shares on capital or revenue account. This will be a question of fact and each investor will need to consider its own circumstances.

Capital Account

Under existing law, a resident of the United States disposing of shares in an Australian company will be free from capital gains tax in Australia except where:

• (a) the shares are held as part of a trade or business conducted through a permanent establishment in Australia; or

• (b) the shareholder and its associates hold (or have held the shares for a 12 month period during the last 24 months) an interest of 10% or more in the issued capital of the company and more than 50% of the company’s assets relate to Australian real property.

If either of the above exceptions apply, capital gains tax in Australia is payable as follows:

Individual Investor

Capital gains tax is payable on 50% of any capital gains (without adjustment for inflation indexation) on the disposal of shares acquired on or after 11:45 a.m. on September 21, 1999 and held for at least 12 months. For shares considered to be acquired for Australian tax purposes prior to 11:45 a.m. on September 21, 1999, individuals will be able to choose between the following alternatives:

• taxed on any capital gain after allowing for cost base indexation up to September 30, 1999 (essentially when indexation ceased) where the shares have been held for at least 12 months (i.e. the difference between the disposal price and the original cost indexed for inflation over the period to September 30, 1999); and

• taxed on 50% of the actual capital gain (without adjustment for inflation indexation) where the shares have been held for at least 12 months.

Normal rates of income tax would apply to capital gains so calculated.

Capital losses are not subject to indexation; they are available as deductions, but only in the form of offset against capital gains. Depending upon which of the above alternatives are chosen, capital losses may be offset against capital gains indexed to September 30, 1999 or the full nominal capital gain before the 50% reduction. Excess capital losses can be carried forward indefinitely for offset against future capital gains.

Corporate Investor

Capital gains tax is payable on any capital gains made (without adjustment for inflation indexation) on the disposal of shares considered to be acquired for Australian tax purposes on or after 11:45am on September 21, 1999. For shares acquired prior to 11:45am on September 21, 1999, a corporate investor will be taxed on any capital gain after allowing for indexation of the cost base (i.e. the difference between the disposal price and the original cost indexed for inflation over the period). The 50% discount is not applicable for corporate investors. The corporate income tax and capital gains tax rate is currently 30%.

There may be other special rules which apply to the taxation of capital gains for other types of entities.

Revenue Account

Under Australia’s domestic income tax provisions, a non-resident of Australia is taxed on profits arising on the sale of shares where that profit is on revenue account and has an Australian source. The

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source of profit is a question of fact and will need to be assessed by the investor. Where the gain is taxable, the Tax Treaty may apply as follows:

• (a) If the United States investor holds the shares as part of a trade or business conducted through a permanent establishment in Australia, any profit on disposal would be assessable and subject to ordinary income tax. (Any losses on disposal may constitute an allowable deduction.)

• (b) If the United States investor does not hold the shares as part of a trade or business conducted through a permanent establishment in Australia, then the Tax Treaty should operate to ensure that the taxing of any profits arising on the sale of shares should only occur in the United States even if the source of that profit is Australian. The only exception is if the profits are in respect of the disposal of shares which consist wholly or principally of real property situated in Australia in which case Australia will have taxing rights under the Tax Treaty.

Any taxable gain would be fully taxable, that is, there is no concession to reduce the gain for inflation or apply a discount to reduce the gain. If a gain is taxable, any capital gain on the sale should be reduced to nil under specific anti-duplication rules.

There should be no Australian stamp duty, goods and services tax or transfer taxes on the sale, disposal or exchange of ordinary shares by a U.S. shareholder.

Australia does not impose any gift, estate, death, or other duty in respect of the gift, devise or bequest of ordinary shares by a U.S. shareholder.

United States Federal taxation

The following discussion is a summary of certain United States federal income tax consequences of owning ordinary Shares or ADSs. This section is based on the U.S. Internal Revenue Code of 1986, as amended, or the Code, its legislative history, existing and proposed regulations and published rulings and court decisions, all as currently in effect, as well as the Tax Treaty. These laws are subject to change, possibly on a retroactive basis. This discussion does not address effects of any state or local tax laws. The specific tax position of each investor will determine the applicable United States federal, state and local income tax implications for that investor and we recommend each investor consult their own tax adviser concerning the implications of receiving dividends and owning and disposing of ordinary shares or ADSs. This section does not apply to you if you are not a “U.S. holder” as defined below.

For purposes of this discussion, you are a “U.S. holder” if you are a beneficial owner of shares and you are:

• a citizen or resident of the United States;

• a domestic corporation;

• an estate whose income is subject to United States federal income tax regardless of its source; or

• a trust if a United States court can exercise primary supervision over the trust’s administration and one or more United States persons are authorized to control all substantial decision of the trust.

Taxation of dividends

Under the United States federal income tax laws, and subject to the discussion below under “Passive foreign investment company,” if you are a U.S. holder, you must include in your gross income the gross amount of any dividend paid by us out of our current or accumulated earnings and profits (as determined for United States federal income tax purposes). If you are a non-corporate U.S. holder,

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dividends paid to you in taxable years beginning before January 1, 2011 that constitute qualified dividend income will be taxable to you at a maximum tax rate of 15% provided that you hold the shares for more than 60 days during the 121-day period beginning 60 days before the exdividend date and meet other holding period requirements.

As a general rule, dividends paid by a foreign corporation will not constitute qualified dividend income if such corporation is treated, for the tax year in which the dividend is paid, or the preceding tax year, as a passive foreign investment company, or a PFIC, for U.S. federal income tax purposes. We do not believe that we will be classified as a PFIC for U.S. federal income tax purposes for our current taxable year or that we were classified as a PFIC in a prior taxable year, and therefore dividends we pay with respect to our shares generally will be qualified dividend income. However, see the discussion under “Passive foreign investment company” below. The 15% reduced rate applicable to dividend distributions does not apply to tax years beginning after December 31, 2010.

You must include any Australian tax withheld from the dividend payment in this gross amount even though you do not in fact receive it. The dividend is ordinary income that you must include in income when you receive the dividend, actually or constructively. The dividend will not be eligible for the dividends-received deduction generally allowed to United States corporations in respect of dividends received from other United States corporations. The amount of the dividend distribution that you must include in your income as a U.S. holder will be the U.S. dollar value of the Australian dollar payments made, determined at the spot Australian dollar/US dollar rate on the date the dividend distribution is included in your income, regardless of whether the payment is in fact converted into U.S. dollars. Generally, any gain or loss resulting from currency exchange fluctuations during the period from the date you include the dividend payment in income to the date you convert the payment into U.S. dollars will be treated as ordinary income or loss and will not be eligible for the special tax rate applicable to qualified dividend income. The gain or loss generally will be income from sources within the United States for foreign tax credit limitation purposes. Distributions in excess of current and accumulated earnings and profits, as determined for United States federal income tax purposes, will be treated as a non-taxable return of capital to the extent of your basis in your ordinary shares and thereafter as capital gain.

Subject to certain limitations, the Australian tax withheld in accordance with the Tax Treaty and paid over to Australia will be creditable against your United States federal income tax liability. Special rules apply in determining the foreign tax credit limitation with respect to dividends that are subject to the maximum 15% rate.

Dividends will be income from sources outside the United States. Under the foreign tax credit rules, dividends paid in taxable years beginning before January 1, 2007, with certain exceptions, will be “passive” or “financial services” income, but dividends paid in taxable years beginning after December 31, 2006 will, depending on your circumstances, be “passive” or “general” income which, in either case, is treated separately from other types of income for purposes of computing the foreign tax credit.

Taxation of capital gains

Subject to the discussion below under “Passive foreign investment company,” if you are a U.S. holder and you sell or otherwise dispose of your ordinary shares or ADSs, you will recognize capital gain or loss for United States federal income tax purposes equal to the difference between the U.S. dollar value of the amount that you realize and your tax basis, determined in U.S. dollars, in your ordinary shares or ADSs. Capital gain of a non-corporate U.S. holder that is recognized before January 1, 2011 is generally taxed at a maximum rate of 15% where the holder has a holding period greater than one year.

Passive foreign investment company

Special U.S. federal income tax rules apply to U.S. holders owning shares of a PFIC. We believe that we were not a PFIC for U.S. federal income tax purposes in any prior taxable year and that we will not be classified as a PFIC for the current taxable year, but we cannot be certain whether we will be

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treated as a PFIC for the current year or any future taxable year. We will generally be considered a PFIC for any taxable year if either (i) at least 75% of our gross income is passive income (the “Income Test”), or (ii) at least 50% of the value of our assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income (the “Asset Test”). For this purpose, passive income generally includes dividends, interest, royalties, rents (other than royalties and rents derived in the active conduct of a trade or business and not derived from a related person), annuities and gains from assets that produce passive income. We will be treated as owning our proportionate share of the assets and earning our proportionate share of the income of any other corporation in which we own, directly or indirectly, 25% or more (by value) of the stock.

We must make a separate determination each year as to whether we are a PFIC. As a result, it is possible that our PFIC status will change. In particular, our PFIC status under the Asset Test will generally be determined by using the market price of our ADSs and ordinary shares, which is likely to fluctuate over time, to calculate the total value of our assets. Accordingly, fluctuations in the market price of the ADSs or ordinary shares may result in our being a PFIC. If we are classified as a PFIC for any year during which you hold ADSs or ordinary shares, we will generally continue to be treated as a PFIC for all succeeding years during which you hold ADSs or ordinary shares. However, if we cease to be a PFIC under the Income Test and the Asset Test, you may make certain elections, including the “mark-to-market” election as discussed below, to avoid PFIC status on a going-forward basis.

If we are a PFIC for any taxable year during which you hold ADSs or ordinary shares, you will be subject to special tax rules with respect to (i) any “excess distribution” that you receive and (ii) any gain you realize from a sale or other disposition (including a pledge) of the ADSs or ordinary shares, unless you make a “mark-to-market” election. Excess distributions are generally defined as distributions you receive in a taxable year that are greater than 125% of the average annual distributions you received during the shorter of the three preceding taxable years or your holding period for the ADSs or ordinary shares. Under these special tax rules: (i) the excess distribution or gain will be allocated ratably over your holding period for the ADSs or ordinary shares, (ii) the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we were a PFIC, will be treated as ordinary income, and (iii) the amount allocated to each other year will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year. The entire amount of any gain realized upon the sale or other disposition will be treated as an excess distribution made in the year of sale or other disposition and as a consequence will be treated as ordinary income and, to the extent allocated to years prior to the year of sale or disposition with respect to which we were a PFIC, will be subject to the interest charge described above. The tax liability for amounts allocated to years prior to the year of disposition or “excess distribution” cannot be offset by any net operating losses for such years, and gains (but not losses) realized on the sale of the ADSs or ordinary shares cannot be treated as capital, even if you hold the ADSs or ordinary shares as capital assets.

Alternatively, a U.S. holder of “marketable stock” (as defined below) in a PFIC may make a mark-to-market election for such stock of a PFIC to elect out of the tax treatment discussed above. If you make a mark-to-market election for the ADSs or ordinary shares, you will include in income each year an amount equal to the excess, if any, of the fair market value of the ADSs or ordinary shares as of the close of your taxable year over your adjusted basis in such ADSs or ordinary shares. You are allowed a deduction for the excess, if any, of the adjusted basis of the ADSs or ordinary shares over their fair market value as of the close of the taxable year. However, deductions are allowable only to the extent of any net mark-to-market gains on the ADSs or ordinary shares included in your income for prior taxable years. Amounts included in your income under a mark-to-market election, as well as gain on the actual sale or other disposition of the ADSs or ordinary shares, are treated as ordinary income. Ordinary loss treatment also applies to the deductible portion of any mark-to-market loss on the ADSs or ordinary

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shares, as well as to any loss realized on the actual sale or disposition of the ADSs or ordinary shares, to the extent that the amount of such loss does not exceed the net mark-to-market gains previously included for such ADSs or ordinary shares. Your basis in the ADSs or ordinary shares will be adjusted to reflect any such income or loss amounts. If you make a valid mark to market election, the tax rules that apply to distributions by corporations which are not PFICs would apply to distributions by us, except that the lower applicable capital gains rate for qualified dividend income discussed above under “Taxation of dividends” would not apply.

The mark-to-market election is available only for “marketable stock,” which is generally stock that is traded on a qualified exchange or other market. We have listed our ordinary shares and ADSs on the New York Stock Exchange. We believe that the New York Stock Exchange will constitute a qualified exchange or other market for this purpose. However, no assurances can be provided that our ordinary shares and ADSs will continue to trade on the New York Stock Exchange or that they will be regularly traded for this purpose.

If a non-U.S. corporation is a PFIC, a holder of shares in that corporation may elect out of the general PFIC rules discussed above by making a qualified electing fund, or QEF, election to include its pro rata share of the corporation’s income on a current basis. You may make a QEF election with respect to us only if we agree to furnish you annually with certain tax information, however. If you hold ADSs or ordinary shares in any year in which we are a PFIC, you will be required to file Internal Revenue Service Form 8621 regarding distributions you receive on the ADSs or ordinary shares, and any gain realized on the disposition of the ADSs or ordinary shares.

The rules applicable to owning shares of a PFIC are complex, and each U.S. holder should consult with its own tax advisor regarding the consequences of investing in a PFIC.

Information reporting and backup withholding

Dividend payments with respect to ADSs or ordinary shares and proceeds from the sale, exchange or redemption of ADSs or ordinary shares may be subject to information reporting to the Internal Revenue Service and possible U.S. backup withholding at a current rate of 28%, unless the conditions of an applicable exception are satisfied. Backup withholding will not apply to a U.S. holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. U.S. holders who are required to establish their exempt status generally must provide such certification on Internal Revenue Service Form W-9. U.S. holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Payments to Non-U.S. holders of distributions on, or proceeds from the disposition of, ordinary shares are generally exempt from information reporting and backup withholding. However, a Non-U.S. holder may be required to establish that exemption by providing certification of non-U.S. status on an appropriate Internal Revenue Service Form W-8.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against your U.S. federal income tax liability, and you may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the Internal Revenue Service and furnishing any required information.

F. Dividends and Paying Agents

Not applicable.

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G. Statements by Experts

Not applicable.

H. Documents on Display

We are subject to the periodic reporting and other informational requirements of the Exchange Act. Under the Exchange Act, we are required to file or furnish reports and other information with the SEC. Copies of reports and other information, when so filed, may be inspected without charge and may be obtained at prescribed rates at the public reference facilities maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. The public may obtain information regarding the Washington, D.C. Public Reference Room by calling the SEC at 1-800-SEC-0330. The public may also view our annual reports and other documents filed with the SEC on the internet at www.sec.gov. As a foreign private issuer, we are exempt from the rules under the Exchange Act prescribing the furnishing and content of quarterly reports and proxy statements, and our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions in Section 16 of the Exchange Act.

I. Subsidiary Information

Not applicable.

Item 11. Quantitative and Qualitative Disclosures About Market Risk

In the normal course of business, our activities result in exposure to a number of financial risks, including market risk (including foreign currency risk, interest rate risk and commodity price risk), credit risk and liquidity risk. Our overall financial risk management strategy seeks to mitigate these risks and reduce volatility on our financial performance. See Note 2 to our consolidated financial statements included in Item 18 of this annual report for detailed information on our financial and capital risk management.

Item 12. Description of Securities Other than Equity Securities

Not applicable.

PART II

Item 13. Defaults, Dividend Arrearages and Delinquencies

Not applicable.

Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds

Not applicable.

Item 15. Controls and Procedures

Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including the Group Chief Executive Officer and Group Chief Financial Officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of June 30, 2009. Based on this evaluation, our Group Chief Executive Officer and Group Chief Financial Officer concluded that our disclosure controls and procedures were effective as of

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such date. Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports that we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including the Group Chief Executive Officer and Group Chief Financial Officer, to allow timely discussions regarding required disclosure.

In designing and evaluating our disclosure controls and procedures, our management, including the Group Chief Executive Officer and the Group Chief Financial Officer, recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Because of the inherent limitations in all control systems, no evaluations of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Group have been detected.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting of Sims, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS as issued by the IASB.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of our management, including our Group Chief Executive Officer and Group Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation, our management concluded that our internal control over financial reporting was effective as of June 30, 2009. The effectiveness of our internal control over financial reporting as of June 30, 2009 has been audited by PricewaterhouseCoopers, an independent registered public accounting firm, as stated in its report which is included herein on page F-1.

Changes in Internal Control over Financial Reporting

In our Annual Report on Form 20-F for the fiscal year ended June 30, 2008, management and our independent registered public accounting firm identified material weaknesses in our internal control over financial reporting. Specifically, we did not maintain an effective process for reviewing financial information and did not have a sufficient number of personnel with an appropriate level of accounting knowledge, experience and training in the application of IFRS commensurate with management’s financial reporting requirements.

A material weakness is a deficiency, or combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual financial statements will not be prevented or detected on a timely basis.

During fiscal 2009, management implemented a number of remediation measures as described below to address the material weaknesses.

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• Defined clear roles and responsibilities and enhanced training for personnel involved in the entity level control processes.

• Implemented standard accounting policies related to estimates involving significant management judgments, as well as other financial reporting areas.

• Expanded our corporate accounting and tax departments and have staffed these departments with individuals that have a thorough understanding of IFRS and the accounting for income taxes.

• Implemented procedures whereby all complex routine and non-routine transactions, such as business combinations and accounting for deferred income taxes, are reviewed by senior management and accurately accounted for in accordance with IFRS.

As of June 30, 2009, we determined that the new controls are effectively designed and have demonstrated effective operation to enable management to conclude that the material weaknesses identified in fiscal 2008 had been remediated. Consequently, this matter did not constitute a control deficiency as of June 30, 2009.

Other than these control enhancements, there have been no changes in internal control over financial reporting during the fiscal year ended June 30, 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 16A. Audit Committee Financial Expert

The Board has determined that both J. Michael Feeney and Gerald E. Morris is an “audit committee financial expert” as defined in Item 16A of Form 20-F. Messrs. Feeney and Morris and each of the other members of the RAC is an “independent director” as defined in Section 303A.02 of the NYSE’s Listed Company Manual

Item 16B. Code of Ethics

We are conscious of our place in the community and the need to adhere to the highest standards of business conduct and compliance with the law and best practice. Our continued success will be assisted by the maintenance of the highest standards of integrity from all employees.

To assist employees to maintain our reputation, a written Code of Conduct has been developed which defines our basic principles of business conduct. Among other things, the Code of Conduct is intended to promote:

• honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

• full, fair, accurate, timely and understandable disclosure in reports and documents that the we file with, or submit to, the ASX, the NYSE, the SEC and in other public communications made by us;

• compliance with applicable governmental laws, rules and regulations;

• prompt internal reporting to the persons identified in the Code of Conduct of violations; and

• accountability for adherence to the Code of Conduct.

While the Code of Conduct outlines the minimum standards of behavior required of each of our directors, officers, and employees, we also expect all of our employees and contractors to strive to achieve levels of performance which exceed basic compliance. Our Board is strongly committed both to the letter of the Code of Conduct and to the spirit of best practice underpinning it, and expects similar commitment from all of our employees and contractors.

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The Code of Conduct is posted on our website at www.simsmm.com, under Corporate Governance.

Item 16C. Principal Accountant Fees and Services

The remuneration of our principal auditors (PricewaterhouseCoopers) including audit fees, audit related fees, tax fees and all other fees, as well as remuneration payable to other accounting firms, is set forth in Note 26 of the consolidated financial statements included in Item 18 of this annual report.

We have adopted policies designed to uphold the independence of our principal auditors by prohibiting their engagement to provide a range of accounting and other professional services that might compromise their appointment as independent auditors. The engagement of our principal auditors to provide statutory audit services, other services pursuant to legislation, taxation services and certain other services are preapproved. Any engagement of our independent auditors to provide other permitted services is subject to the specific approval of the RAC or its chairman.

Prior to the commencement of each financial year, management and our principal auditors submit to the RAC a schedule of the types of services that are expected to be performed during the following year for its approval. The RAC may impose a dollar limit on the total value of other permitted services that can be provided.

Item 16D. Exemptions from the Listing Standards for Audit Committees

Not applicable.

Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Not applicable.

Item 16F. Change in Registrant’s Certifying Accountant

Not applicable.

Item 16G. Corporate Governance

Under the NYSE’s corporate governance standards as codified under Section 303A of the NYSE Listed Company Manual, or the Listing Rules, foreign private issuers, such as Sims, are permitted to follow home country practice in lieu of the Listing Rules, except for the rule regarding compliance with Rule 10A-3 of the Exchange Act and certain notification provisions contained in the Listing Rules. Also, the Listing Rules require that foreign private issuers disclose any significant ways in which their corporate governance practices differ from those followed by listed domestic companies under the Listing Rules. Such significant differences are described below and on our Internet website at www.simsmm.com.

Following a comparison of our corporate governance practices with the requirements of the Listing Rules, the following significant differences were identified:

• we do not schedule regular sessions where NEDs meet without management participation other than in the case of the Risk, Audit and Compliance Committee; however, the NEDs are free to meet amongst themselves as they choose;

• the Remuneration Committee charter does not include a mandate to review and approve the corporate goals and objectives relevant to Group Chief Executive Officer compensation (this responsibility rests with the Board), to specify the qualifications of its members or its reporting obligations to the Board. It also does not include a mandate to report on executive

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• officer compensation (such disclosure is made in the remuneration report in our annual reports), to give the Remuneration Committee sole authority to retain and terminate a search firm or to approve a consultant’s fees and other retention terms (although the Remuneration Committee is authorized to obtain professional advice on any matters within its charter); and

• we do not have corporate governance guidelines with respect to the procedure for how a director may access management, director compensation information (however, such disclosure is made in the remuneration report in our annual reports) or director orientation and continuing education.

PART III

Item 17. Financial Statements

Not applicable.

Item 18. Financial Statements

The following consolidated financial statements are filed as part of this annual report:

Consolidated Financial Statements — Sims Metal Management Limited

Report of Independent Registered Public Accounting Firm	F-1
Income Statements	F-2
Balance Sheets	F-3
Statements of Recognized Income and Expense	F-4
Cash Flow Statements	F-5
Notes to the Financial Statements	F-7

Consolidated Financial Statements — SA Recycling, LLC and Subsidiaries

Report of Independent Registered Public Accounting Firm	F-80
Consolidated Balance Sheets	F-81
Consolidated Statements of Operations	F-82
Consolidated Statements of Changes in Members Equity	F-83
Consolidated Statements of Cash Flows	F-84
Notes to Consolidated Financial Statements	F-85

Item 19. Exhibits

Exhibit Index

Exhibit Number 1.1	Description
	Constitution of the Registrant (incorporated by reference to Exhibit 3.1 on Form F-4 filed on November 28, 2007).

• 2.1 Form of Deposit Agreement among the Registrant, The Bank of New York, as the depositary, and all owners and holders from time to time of American Depositary Shares issued thereunder (incorporated by reference to Exhibit 4.1 on Form F-4/A filed on February 8, 2008).

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Exhibit Number Description

• 2.2 Top-Up Deed, dated April 2, 2007, by and between the Registrant and Votraint No. 1652 Pty Limited (Mitsui) (incorporated by reference to Exhibit 4.2 on Form F-4 filed on November 28, 2007).

• 2.3 Amendment Deed, dated November 27, 2007, by and between the Registrant and Mitsui Raw Materials Development Pty Limited (incorporated by reference to Exhibit 4.3 on Form F-4 filed on November 28, 2007).

• 4.1 Agreement and Plan of Merger dated as of September 24, 2007, between and among the Registrant, MMI Acquisition Corporation and Metal Management, Inc. (incorporated by reference to Appendix A on Form F-4 filed on November 28, 2007).

• 4.2 Rules of the Dividend Reinvestment Plan (incorporated by reference to Exhibit 10.1 on Form F-4 filed on November 28, 2007).

• 4.3 Executive Long Term Incentive Plan Rules (incorporated by reference to Exhibit 10.2 on Form F-4 filed on November 28, 2007).

• 4.4 Long Term Incentive Plan Rules, as amended October 23, 2008 (incorporated by reference to Exhibit 4.5 on Form S-8 filed on January 23, 2009).

• 4.5 Sims Group Limited Transition Incentive Stock Plan (incorporated by reference to Exhibit 10.1 on Form S-8 filed on March 14, 2008).

• 4.6 Employment Agreement, dated January 8, 2007, by and between the Registrant and Graham Davy (incorporated by reference to Exhibit 10.9 on Form F-4 filed on November 28, 2007).

• 4.7 Employment Agreement, effective as of February 1, 2007, by and between the Registrant and Bob Kelman (incorporated by reference to Exhibit 10.10 on Form F-4 filed on November 28, 2007).

• 4.8 Deed of Release, dated August 26, 2009, by and between Sims Metal Management Limited and Jeremy Sutcliffe.

• 4.9 Employment Agreement, dated January 8, 2007, by and between the Registrant and Darron McGree (incorporated by reference to Exhibit 10.11 on Form F-4 filed on November 28, 2007).

• 4.10 Letter Agreement, dated September 24, 2007, by and between the Registrant and Robert C. Larry (incorporated by reference to Exhibit 10.12 on Form F-4 filed on November 28, 2007).

• 4.11 Letter Agreement, dated September 24, 2007, by and between the Registrant and Daniel W. Dienst (incorporated by reference to Exhibit 10.13 on Form F-4 filed on November 28, 2007).

• 4.12 Operating Agreement of SA Recycling LLC, dated as of September 1, 2007, by and between Adams Steel, LLC and Simsmetal West LLC (f/k/a Sims Hugo Neu West LLC) (incorporated by reference to Exhibit 10.14 on Form F-4/A filed on January 17, 2008).

• 4.13 • Multi-Option Facility Agreement dated November 2, 2009 among Commonwealth Bank of Australia, Sims Metal Management Limited, and its affiliates listed on Schedule 1 thereto as “Original Borrowers.”

• 4.14 Common Terms Deed dated November 2, 2009 among Commonwealth Bank of Australia, Sims Metal Management Limited, and its affiliates listed on Parts 1 and 2 of Schedule 1 thereto as “Original Borrowers” and “Original Guarantors,” respectively.

• 4.15 • Group Limit Facility dated November 2, 2009, between, amongst others, Commonwealth Bank of Australia and Sims Metal Management Limited.

• 4.16 • Multicurrency Revolving Floating Rate Cash Advance Facility, dated November 1, 2000, among Westpac Banking Corporation and Simsmetal Limited, Simsmetal Finance Limited, Simsmetal USA Corporation, Simsmetal UK Holdings Limited and Simsmetal UK Limited (collectively, the “Parties”); the Standard Terms, dated November 1, 2000, among the Parties; and the variations to such agreements (incorporated by reference to Exhibit 4.16 on Form 20-F filed on December 10, 2008).

• 4.17 • Variation to Standard Terms dated November 2, 2009 by and among Westpac Banking Corporation, Sims Metal Management Limited and certain of its subsidiaries (including the Standard Terms in the Annexure thereto).

• 4.18 • Amended and Restated Credit Agreement dated as of November 2, 2009 among Sims Group USA Holdings Corporation, certain of its affiliates identified therein as “Borrowers,” and Bank of America, N.A.

• 4.19 Amended and Restated Deed Poll of Continuing Guaranty dated as of November 2, 2009 by Sims Metal Management Limited in favor of Bank of America, N.A.

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Exhibit Number Description

• 8.1 List of subsidiaries.

• 12.1 Certification of Group Chief Executive Officer pursuant to Rule 13 (a) — 14(a) of the Securities Exchange Act of 1934.

• 12.2 Certification of Group Chief Financial Officer pursuant to Rule 13 (a) — 14(a) of the Securities Exchange Act of 1934.

• 13.1 Certification of Group Chief Executive Officer and Group Chief Financial Officer pursuant to Rule 13(a) — 14 (b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

• 15.1 Consent of Independent Registered Public Accounting Firm to the incorporation of the audit report relating to Sims Metal Management Limited and effectiveness of internal control over financial reporting of Sims Metal Management Limited by reference in registration statements on Form S-8.

• 15.2 Consent of Independent Registered Public Accounting Firm to the incorporation of the audit report relating to SA Recycling LLC by reference in registration statements on Form S-8.

• Portions of this exhibit have been omitted pursuant to a request for confidential treatment filed with the Commission under Rule 24b-2 under the Securities Exchange Act of 1934, as amended. The omitted confidential material has been filed separately with the Commission. The location of the confidential information is indicated in the exhibit with brackets and a bullet point ([ • ]).

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

Sims Metal Management Limited

By: /s/ Frank M. Moratti Frank M. Moratti Company Secretary and Legal Counsel

Date: November 12, 2009

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==> picture [544 x 181] intentionally omitted <==

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Sims Metal Management Limited:

In our opinion, the accompanying consolidated balance sheets and the related consolidated income statements, consolidated statements of recognized income and expense and consolidated cash flow statements present fairly, in all material respects, the financial position of Sims Metal Management Limited and its subsidiaries (“the Company”) at 30 June 2009 and 2008, and the results of their operations and their cash flows for each of the three years in the period ended 30 June 2009 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of 30 June 2009, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included under the heading “Management’s Report on Internal Control over Financial Reporting” in the accompanying Annual Report. Our responsibility is to express opinions on these financial statements and on the Company’s internal control over financial reporting based on our audits (which was an integrated audit in 2009). We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

As discussed in Note 1b to the consolidated financial statements, the Company has changed the manner in which it accounts for the valuation of land, buildings and leasehold improvements in fiscal 2009. This change has been applied retrospectively.

Our audit of the consolidated financial statements of the Company was conducted for the purpose of forming an opinion on the consolidated financial statements taken as a whole. The Company has included parent only information on the face of the consolidated financial statements and other parent company only disclosures in the notes to the financial statements. Such parent only information is presented for purposes of additional analysis and is not a required part of the consolidated financial statements presented in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board. Such information has been subjected to the auditing procedures applied in the audit of the consolidated financial statements, and, in our opinion, is fairly stated in all material respects in relation to the consolidated financial statements taken as a whole.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

PricewaterhouseCoopers Sydney, Australia 28 August 2009

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Income Statements

For the year ended 30 June 2009

	Note				Consolidated		2007 A$’000		Parent	Parent
			2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
Revenue	4		8,641,010		7,670,536		5,550,897		232,557		171,678
Other income	5		33,737		55,667		8,978		—		—
Raw materials used and changes in inventories	9		(6,272,623 )		(5,324,584 )		(3,847,254 )		—		—
Freight expense			(919,310)		(778,668)		(540,178)		—		—
Employee benefits expense			(592,380 )		(404,873 )		(296,421 )		(2,733 )		(2,777 )
Depreciation and amortisation expense	6		(170,820)		(95,086)		(74,453)		—		—
Repairs and maintenance expense			(147,773 )		(126,192 )		(117,993 )		—		—
Other expenses			(542,209)		(363,047)		(303,312)		—		—
Finance costs			(21,508 )		(34,374 )		(30,405 )		—		—
Goodwill impairment charge	13		(191,094)		(3,349)		—		—		—
Share of pre-tax profit of investments accounted for using the equity method	29		60,808		64,573		7,030		—		—
(Loss)/profit before income tax			(122,162)		660,603		356,889		229,824		168,901
Income tax (expense)/benefit	7		(28,133 )		(220,505 )		(116,951 )		353		391
(Loss)/profit for the year attributable to equity holders of the Parent			(150,295) A¢		440,098 A¢		239,938 A¢		230,177		169,292
(Loss)/earnings per share:
Basic	32		(82.9)		310.9		192.1
Diluted	32		(82.9 )		307.9		191.0

The above income statements should be read in conjunction with the accompanying notes.

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Balance Sheets As at 30 June 2009

	Note		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
			2009 A$’000				2009 A$’000		2008 A$’000
ASSETS
Current assets
Cash and cash equivalents	33		69,536		133,487		198		—
Trade and other receivables	8		350,309		839,518		—		41,147
Current tax receivable			96,197		26,583		14,476		—
Inventory	9		469,123		1,010,921		—		—
Derivative financial instruments	10		713		3,948		—		—
Total current assets			985,878		2,014,457		14,674		41,147
Non-current assets
Receivables	8		17,482		2,963		—		—
Investments accounted for using the equity method	29		400,244		332,226		—		—
Other financial assets	11		—		—		4,026,774		4,026,736
Property, plant and equipment	12		947,725		784,692		—		—
Deferred tax assets	7		71,636		109,982		—		—
Goodwill	13		1,146,785		1,166,534		—		—
Other intangible assets	14		238,810		235,622		—		—
Total non-current assets			2,822,682		2,632,019		4,026,774		4,026,736
Total assets			3,808,560		4,646,476		4,041,448		4,067,883
LIABILITIES
Current liabilities
Trade and other payables	15		537,947		1,062,253		284,831		343,483
Borrowings	16		811		877		—		—
Derivative financial instruments	10		10,464		2,463		—		—
Current tax liabilities			5,910		131,363		—		40,756
Provisions	17		21,800		28,064		—		—
Total current liabilities			576,932		1,225,020		284,831		384,239
Non-current liabilities
Payables			4,200		2,270		—		—
Borrowings	16		174,333		397,537		—		—
Deferred tax liabilities	7		148,843		148,168		—		—
Provisions	17		34,026		34,729		—		—
Retirement benefit obligations	18		11,179		4,828		—		—
Total non-current liabilities			372,581		587,532		—		—
Total liabilities			949,513		1,812,552		284,831		384,239
Net assets			2,859,047		2,833,924		3,756,617		3,683,644
EQUITY
Contributed equity	19		2,352,928		2,325,924		3,673,584		3,646,580
Reserves	20		166,045		(174,335)		38,426		36,141
Retained profits	20		340,074		682,335		44,607		923
Total equity			2,859,047		2,833,924		3,756,617		3,683,644

The above balance sheets should be read in conjunction with the accompanying notes.

F-3

Table of Contents

Statements of Recognised Income and Expense For the year ended 30 June 2009

	Note			Consolidated	Consolidated		2007 A$’000		Parent	Parent
			2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
Actuarial (loss)/gain on defined benefit plans, net of tax	18		(5,473 )		(7,827 )		5,211		—		—
Changes in fair value of cash flow hedges, net of tax	20		998		(9,656)		9,121		—		—
Exchange differences on translation of foreign operations	20		336,911		(130,800 )		(74,784 )		—		—
Net income/(expense) recognised directly in equity			332,436		(148,283)		(60,452)		—		—
(Loss)/profit for the year			(150,295 )		440,098		239,938		230,177		169,292
Total recognised income and expense for the year			182,141		291,815		179,486		230,177		169,292
Effect of change in accounting policy:
Total equity at the beginning of the financial year			2,833,924		1,279,430		1,183,198
Accounting policy change, net of tax	1 (b)(vi)		—		(107,343 )		(75,274 )
Restated total equity at the beginning of the financial year			2,833,924		1,172,087		1,107,924
Profit as originally reported			—		433,162		239,352
Accounting policy change, net of tax	1 (b)(vi)		—		6,936		586
Restated profit			—		440,098		239,938

The above statements of recognised income and expense should be read in conjunction with the accompanying notes.

F-4

Table of Contents

Cash Flow Statements For the year ended 30 June 2009

	Note				Consolidated		2007 A$’000		Parent	Parent
			2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
Cash flows from operating activities
Receipts from customers (inclusive of goods and services tax)			9,232,836		7,353,894		5,683,089		—		—
Payments to suppliers and employees (inclusive of goods and services tax)			(8,475,440 )		(6,943,173 )		(5,183,974 )		—		—
Interest received			2,272		2,876		2,364		—		—
Interest paid			(20,927 )		(34,374 )		(30,405 )		—		—
Dividends from associates and jointly controlled entities	29		41,458		5,153		—		—		—
Insurance recoveries			12,277		7,632		—		—		—
Dividends from wholly-owned entities			—		—		—		231,001		170,205
Income taxes paid			(238,025 )		(144,477 )		(135,612 )		(54,428 )		(40,056 )
Net loans (from)/to subsidiaries			—		—		—		(16,886)		20,705
Net cash inflow from operating activities	33		554,451		247,531		335,462		159,687		150,854
Cash flows from investing activities
Payments for property, plant and equipment	12		(187,474 )		(129,691 )		(90,503 )		—		—
Payments on acquisitions of subsidiaries, net of cash acquired	27		(76,014)		(58,517)		(158,914)		—		—
Proceeds from sale of property, plant and equipment			5,461		2,022		8,203		—		—
Proceeds from sale of subsidiaries			39,708		—		—		—		—
Return of capital from jointly controlled entities	29		3,584		48,496		—		—		—
Net cash outflow from investing activities			(214,735)		(137,690)		(241,214)		—		—
Cash flows from financing activities
Proceeds from borrowings			1,847,303		815,715		916,509		—		—
Repayment of borrowings			(2,112,610 )		(678,377 )		(869,825 )		—		—
Fees paid for loan facilities			(1,987)		—		—		—		—
Proceeds from issue of shares			442		5,735		1,872		442		5,735
Dividends paid	21		(159,931)		(156,589)		(120,026)		(159,931)		(156,589)
Net cash outflow from financing activities			(426,783 )		(13,516 )		(71,470 )		(159,489 )		(150,854 )
Net (decrease)/increase in cash and cash equivalents			(87,067)		96,325		22,778		198		—
Cash and cash equivalents at the beginning of the financial year			133,487		38,560		15,800		—		—
Effects of exchange rate changes on cash and cash equivalents			23,116		(1,398)		(18)		—		—
Cash and cash equivalents at the end of the financial year	33		69,536		133,487		38,560		198		—

The above cash flow statements should be read in conjunction with the accompanying notes.

F-5

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

	Page
1 Summary of significant accounting policies	F-7
2 Financial and capital risk management	F-22
3 Critical accounting estimates and judgements	F-27
4 Revenue	F-28
5 Other income	F-29
6 Expenses	F-29
7 Income tax and deferred tax	F-30
8 Trade and other receivables	F-34
9 Inventory	F-35
10 Derivative financial instruments	F-36
11 Other financial assets	F-36
12 Property, plant and equipment	F-37
13 Goodwill	F-38
14 Intangible assets	F-40
15 Trade and other payables	F-40
16 Borrowings	F-41
17 Provisions	F-41
18 Retirement benefit obligations	F-42
19 Contributed equity	F-45
20 Reserves and retained profits	F-46
21 Dividends	F-47
22 Contingencies	F-48
23 Commitments	F-49
24 Share ownership plans	F-50
25 Key management personnel disclosures	F-56
26 Remuneration of auditors	F-60
27 Business combinations and disposals	F-61
28 Subsidiaries	F-63
29 Investments in associates and jointly controlled entities	F-67
30 Related party transactions	F-69
31 Segment reporting	F-71
32 Earnings per share	F-75
33 Cash flow information	F-75
34 Events occurring after the reporting period	F-77

F-6

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies

Sims Metal Management Limited is a company domiciled in Australia. The principal accounting policies adopted in the preparation of this financial report are set out below. These policies have been consistently applied to all years presented, unless otherwise stated. The financial report includes separate financial statements for Sims Metal Management Limited as an individual entity referred to in this financial report as the “Parent” or “Company”. Sims Metal Management Limited and its subsidiaries together are referred to in this financial report as the “Group” or the “Consolidated” entity.

The Parent was incorporated on 20 June 2005. Under the terms of a scheme of arrangement entered into between Sims Metal Management Limited (formerly known as Sims Group Limited from 20 June 2005 to 21 November 2008) and Sims Group Australia Holdings Limited (formerly known as Sims Group Limited prior to 20 June 2005) on 31 October 2005, the shareholders in Sims Group Australia Holdings Limited exchanged their shares in that entity for the shares in Sims Metal Management Limited. As required by Australian Accounting Standards Board (“AASB”) 3, “ Business Combinations ”, Sims Group Australia Holdings Limited was deemed to be the acquirer in this business combination. This transaction has therefore been accounted for as a reverse acquisition under AASB 3. Accordingly the consolidated financial statements of Sims Metal Management Limited have been prepared as a continuation of the consolidated financial statements of Sims Group Australia Holdings Limited. Sims Group Australia Holdings Limited, as the deemed acquirer, has applied purchase accounting for its acquisition of Sims Metal Management Limited as at 31 October 2005.

(a) Statement of compliance

The financial report is a general purpose financial report which has been prepared in accordance with the requirements of the Corporations Act 2001, Australian Accounting Standards and other authoritative pronouncements of the AASB. The financial report also complies with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board.

(b) Basis of preparation

(i) Historical cost convention

This financial report has been prepared under the historical cost convention, except for derivative financial instruments, which are measured at fair value.

(ii) Parent entity

As at 30 June 2009, the Parent had current liabilities greater than current assets. The current liabilities represent intercompany balances between entities which are a party to a Deed of Cross Guarantee to which the Parent is also a party. See Note 28.

(iii) Reclassifications and prior period adjustments

Certain reclassifications have been made to prior period amounts to conform to the current period financial statement presentation with no significant impact effect on the previously reported financial statements.

The Group reclassified outstanding cheques of A$99.4 million which were included within non-current borrowings as at 30 June 2008 to trade and other payables to be consistent with the presentation as at 30 June 2009. The Group also reclassified finance leases of A$1.2 million which were included within trade and other payables as at 30 June 2008 to current and non-current borrowings to be consistent with the presentation as at 30 June 2009. The reclassifications had no impact on net assets and did not affect the Group’s compliance with any lending covenants.

In connection with the Group’s ongoing efforts to remediate its previously reported material weaknesses and other internal control deficiencies, the Group identified two immaterial adjustments related to the year ended 30 June 2008. These items related to unrealised profits in closing inventories on sales between equity accounted jointly controlled entities and certain Group subsidiaries which had not been eliminated (A$8.8 million pre-tax) and certain share-based payment awards for which the fair values had been understated at the date of grant in the calculation of the annual expense (A$2.4 million pre-tax). The Group concluded that these adjustments were not material to its financial statements for both the 2008 and 2009 financial years. The impact of these adjustments has been reflected in the current financial year.

F-7

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(b) Basis of preparation (continued)

(iv) Critical accounting estimates

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in Note 3.

(v) Early adoption of accounting standards

Revised AASB 123, “ Borrowing Costs” and AASB 2007-6, “ Amendments to Australian Accounting Standards arising from AASB 123” were early adopted by the Group on 1 July 2008. Revised AASB 123 has removed the option to expense all borrowing costs and requires the capitalisation of all borrowing costs directly attributable to the acquisition, construction or the production of a qualifying asset.

(vi) Change in accounting policy

In the current financial year, the Group revised its accounting policy for the valuation of land, buildings and leasehold improvements from the revaluation method to the historical cost method in accordance with AASB 116, “ Property, Plant and Equipment ” and AASB 108, “Accounting Policies, Changes in Accounting Estimates and Errors ”. The policy change results in the financial report providing reliable and more relevant information about the effects of transactions, other events and conditions on the Group’s financial position and financial performance. This will allow for enhanced comparability among the Group’s peers and also provide a consistent valuation methodology among all fixed asset classes for the benefit of current and prospective investors and for internal financial reporting purposes. The change was also intended to reduce administrative costs in the form of professional fees incurred to accomplish the revaluations. This change in accounting policy has been applied retrospectively in this financial report, with the impact summarised below.

Consolidated	2008 A$’000	Impact of Policy Change A$’000	Restated 2008 A$’000
Investments accounted for using the equity method	335,826	(3,600 )	332,226
Property, plant and equipment	950,210	(165,518)	784,692
Deferred tax assets	111,360	(1,378 )	109,982
Current tax liabilities	131,429	(66)	131,363
Deferred tax liabilities	190,434	(42,266 )	148,168
Reserves	(39,014)	(135,321)	(174,335)
Retained profits	675,178	7,157	682,335

Consolidated	2008 A$’000	Impact of Policy Change & Other A$’000	Restated 2008 A$’000	2007 A$’000	Impact of Policy Change & Other A$’000	Restated 2007 A$’000
Other income	51,448	4,219	55,667	8,978	—	8,978
Depreciation and amortisation expense	(94,557)	(529)	(95,086)	(75,177)	724	(74,453)
Other expenses	(371,479 )	8,432	(363,047 )	(303,312 )	—	(303,312 )
Income tax expense	(218,668)	(1,837)	(220,505)	(116,813)	(138)	(116,951)
Profit for the year	433,162	6,936	440,098	239,352	586	239,938
	A¢		A¢	A¢		A¢
Earnings per share:
Basic (Note 32)	306.0		310.9	191.6		192.1
Diluted (Note 32)	303.0		307.9	190.5		191.0

F-8

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(c) Principles of consolidation

(i) Subsidiaries

Subsidiaries are entities which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

The results of subsidiaries acquired or disposed of during the financial year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.

The purchase method of accounting is used to account for the acquisition of subsidiaries. The purchase method of accounting involves allocating the cost of the business combination to the fair value of assets acquired and liabilities assumed at the date of acquisition. See Note 27 for further details.

Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of the subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Investments in subsidiaries are accounted for at cost in the individual financial statements of the Parent.

(ii) Associates

Associates are entities over which the Group has significant influence but not control or joint control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for in the Parent’s financial statements using the cost method and in the Group’s financial statements using the equity method of accounting, after initially being recognised at cost. The Group’s investment in associates includes goodwill (net of any accumulated impairment loss) identified on acquisition. Details relating to associates are set out in Note 29.

The Group’s share of its associates’ post-acquisition profits or losses is recognised in the income statement, and its share of post-acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. Dividends receivable from associates are recognised in the Parent’s income statement, while in the Group’s financial statements they reduce the carrying amount of the investment.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed as appropriate to ensure consistency with the policies adopted by the Group.

F-9

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(c) Principles of consolidation (continued)

(iii) Joint ventures

Joint venture operations

The Group’s proportionate interests in the assets, liabilities, income and expenses of its joint ventures have been incorporated in the consolidated financial statements under the appropriate headings. Details of the joint venture operations are set out in Note 29.

Jointly controlled entities

The Group’s interests in jointly controlled entities are accounted for in the consolidated financial statements using the equity method. Under the equity method, the share of the profits or losses of the jointly controlled entities are recognised in the income statement, and the share of movements in reserves is recognised in reserves in the balance sheet. Details relating to jointly controlled entities are set out in Note 29.

Profits or losses on transactions establishing the joint ventures and transactions with the joint ventures are eliminated to the extent of the Group’s ownership interest until such time as they are realised by the joint venture on consumption or sale, unless they relate to an unrealised loss that provides evidence of the impairment of an asset transferred.

(d) Segment reporting

AASB 8, “ Operating Segments ” was early adopted by the Group in the year ended 30 June 2008. Operating segments are reported in a manner consistent with the internal reporting provided to the Group Chief Executive Officer who is the chief operating decision maker. Details on the Group’s segments are set out in Note 31.

(e) Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in Australian dollars (“A$”) which is Sims Metal Management Limited’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges or are attributable to part of the net investment in a foreign operation.

Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary assets such as equities classified as available-for-sale financial assets are included in the fair value reserve in equity.

F-10

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(e) Foreign currency translation (continued)

(iii) Group companies

The results and financial position of all Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

• assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;

• income and expenses for each income statement are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

• all resulting exchange differences are recognised as a separate component of equity.

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other currency instruments designated as hedges of such investments, are taken to equity. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, a proportionate share of such exchange differences are recognised in the income statement as part of the gain or loss on sale where applicable.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

(f) Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns and trade allowances.

The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved.

Details relating to the Group’s revenue are set out in Note 4. Revenue is recognised for the major business activities as follows:

(i) Sales of goods

Revenue from the sale of goods is recognised when there is persuasive evidence, usually in the form of an executed sales agreement at the time of delivery of goods to the customer, indicating that there has been a transfer of risks and rewards to the customer, no further work or processing is required, the quantity and quality of the goods has been determined, the price is fixed and generally title has passed.

(ii) Service revenue

Service revenue principally represents revenue earned from the collection of end-of-life post consumer products for the purpose of product recycling. Service revenue is recognised when the services have been provided. Service revenue received in advance of the service being rendered is deferred.

(iii) Interest income

Interest income is recognised on a time proportion basis using the effective interest method.

(iv) Dividend income

Dividends are recognised as revenue when the right to receive payment is established.

F-11

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(g) Government grants

Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions.

Government grants relating to costs are deferred and recognised in the income statement over the period necessary to match them with the costs that they are intended to compensate.

Government grants relating to the purchase of property, plant and equipment are included in non-current liabilities as deferred income and are credited to the income statement on a straight line basis over the expected lives of the related assets.

(h) Income tax

The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax basis of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in subsidiaries where the Parent is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.

(i) Tax consolidation legislation

Sims Metal Management Limited and its wholly-owned Australian controlled entities have implemented the tax consolidation legislation.

The head entity, Sims Metal Management Limited, and the controlled entities in the tax consolidated group account for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax consolidated group continues to be a stand alone taxpayer in its own right.

In addition to its own current and deferred tax amounts, Sims Metal Management Limited also recognises the current tax liabilities or assets arising from controlled entities in the tax consolidated group.

Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts receivable from or payable to other controlled entities in the tax consolidated group. Details about the tax funding agreement are disclosed in Note 7.

Any difference between the amounts assumed and amounts receivable or payable under the tax funding agreement are recognised as a contribution to (or distribution from) wholly-owned tax consolidated entities.

F-12

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(i) Leases

Leases of property, plant and equipment where the Group, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in other borrowings. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the income statement over the lease period as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Property, plant and equipment acquired under finance leases is depreciated over the asset’s useful life or over the shorter of the asset’s useful life and the lease term if there is no reasonable certainty that the Group will obtain ownership at the end of the lease term.

Leases in which a significant portion of the risks and rewards of ownership are not transferred to the Group as lessee are classified as operating leases as set out in Note 23. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

Lease income from operating leases where the Group is a lessor is recognised in income on a straight-line basis over the lease term.

(j) Business combinations

The purchase method of accounting is used to account for all business combinations, including business combinations involving entities or businesses under common control, regardless of whether equity instruments or other assets are acquired. Cost is measured as the fair value of the assets given, equity instruments issued or liabilities incurred or assumed at the date of exchange plus costs directly attributable to the acquisition. Where equity instruments are issued in an acquisition, the fair value of the instruments is their published market price as at the date of exchange unless, in rare circumstances, it can be demonstrated that the published price at the date of exchange is an unreliable indicator of fair value and that other evidence and valuation methods provide a more reliable measure of fair value. Transaction costs arising on the issue of equity instruments are recognised directly in equity.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill and are set out in Note 27. If the cost of acquisition is less than the Group’s share of the fair value of the identifiable net assets of the subsidiary acquired, the difference is recognised directly in the income statement, but only after a reassessment of the identification and measurement of the net assets acquired.

When part or the entire amount of purchase consideration is contingent on future events, the cost of the acquisition initially recorded includes a reasonable estimate of the fair value of the contingent amounts expected to be payable in the future. The cost of the acquisition is adjusted when revised estimates are made, with corresponding adjustments made to goodwill until the ultimate outcome is known.

(k) Impairment of assets

Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment or more frequently if events or changes in circumstances indicate that they might be impaired. Impairment is determined by assessing the recoverable amount of the cash-generating unit (“CGU”), to which the goodwill relates. See Note 13 for information on the Group’s CGUs. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

F-13

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(l) Cash and cash equivalents

Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions and other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts are shown within borrowings in current liabilities in the balance sheet.

(m) Trade and other receivables

Trade receivables, which generally have 30 to 60 day terms, are recognised initially at fair value and subsequently measured at amortised cost, less provision for impairment.

Collectibility of trade receivables is reviewed on an ongoing basis. Individual debts which are known to be uncollectible are written off by reducing the carrying amount directly. A provision for impairment of trade receivables is recognised when there is objective evidence that the Group will not be able to collect the receivable. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 90 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is recognised in the income statement as other expenses.

When a trade receivable for which an impairment provision had been recognised becomes uncollectible in a subsequent period, it is written-off against the provision for impairment account. Subsequent recoveries of amounts previously written-off are credited against other expenses in the income statement. Details relating to trade and other receivables are set out in Note 8.

(n) Inventory

Raw materials and stores, work in progress and finished goods are stated at the lower of cost and net realisable value. Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditures, the latter being allocated on the basis of normal operating capacity. Costs are assigned to inventory on the basis of weighted average costs. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Details relating to inventory are set out in Note 9.

(o) Non-current assets (or disposal groups) held for sale and discontinued operations

Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. They are measured at the lower of their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee benefits and financial assets that are carried at fair value, which are specifically exempt from this requirement.

An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset (or disposal group), but not in excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the date of the sale of the non-current asset (or disposal group) is recognised at the date of derecognition.

Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while they are classified as held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be recognised.

Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(o) Non-current assets (or disposal groups) held for sale and discontinued operations (continued)

A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and that represents a separate major line of business or geographical area of operations, is part of a single coordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations are presented separately on the face of the income statement.

(p) Investments and other financial assets

The Group classifies its financial assets in the following categories: financial assets at fair value through profit or loss and loans and receivables. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and re-evaluates this designation at each reporting date.

(i) Financial assets at fair value through profit or loss

Financial assets classified as held for trading are included in the category “financial assets at fair value through profit or loss”. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term with the intention of making a profit. Derivatives are also classified as held for trading unless they are designated as effective hedging instruments. Gains or losses on financial assets held for trading are recognised in profit or loss and the related assets are classified as current assets in the balance sheet.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Group provides money, goods or services directly to a debtor with no intention of selling the receivable. They are included in current assets, except for those with maturities greater than 12 months after the balance sheet date which are classified as non-current assets. Loans and receivables are included in trade and other receivables in the balance sheet.

(iii) Recognition and derecognition

All regular way purchases and sales of financial assets are recognised on the trade date – the date that the Group commits to purchase or sell the asset. Regular way purchases or sales are purchases or sales of financial assets under contracts that require delivery of the assets within the timeframe established generally by regulation or convention in the market place. The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

(q) Property, plant and equipment

Property, plant and equipment is stated at historical cost less accumulated depreciation. Historical cost includes expenditures that are directly attributable to the acquisition and installation of the items. Cost may also include transfers from equity of any gains/losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Details relating to property, plant and equipment are set out in Notes 1(b)(vi) and 12.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(q) Property, plant and equipment (continued)

All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred. Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost net of their residual values, over their estimated useful lives, as follows:

• Buildings — 25-40 years

• Plant and equipment — 3-14 years

• Leasehold improvements — life of the lease

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. An asset’s carrying amount is written-down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount as set out in Note 1(k). Gains and losses on disposals are determined by comparing proceeds with carrying amounts and recognised in the income statement.

(r) Derivatives and hedging activities

The Group is a party to derivative financial instruments in the normal course of business in order to hedge its exposure to currency fluctuations in foreign exchange rates and commodity prices in accordance with the Group’s financial risk management policies which are set out in Note 2.

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group designates certain derivatives as either; (i) hedges of the fair value of recognised assets or liabilities or a firm commitment (“fair value hedges”); or (ii) hedges of highly probable forecast transactions (“cash flow hedges”).

Certain derivative instruments do not qualify for hedge accounting, despite being valid economic hedges of the relevant risks. Changes in the fair value of any derivative instrument that does not qualify for hedge accounting are recognised immediately in the income statement and are included in other income or other expenses and are classified in the balance sheet as a current asset or liability.

The Group documents at the inception of the hedging transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions have been and will continue to be highly effective in offsetting changes in fair values or cash flows of hedged items.

The fair values of various derivative financial instruments used for hedging purposes are disclosed in Note 10. Movements in the hedging reserve in equity are shown in Note 20. The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining maturity of the hedged item is more than 12 months; it is classified as a current asset or liability when the remaining maturity is less than 12 months.

(i) Fair value hedge

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(r) Derivatives and hedging activities (continued)

(ii) Cash flow hedge

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in equity in the hedging reserve. The gain or loss relating to the ineffective portion is recognised immediately in the income statement within other income or other expenses.

Amounts accumulated in equity are recognised in the income statement in the periods when the hedged item affects profit or loss (for instance when the forecast sale that is hedged takes place). The gain or loss relating to the effective portion of forward foreign exchange contracts hedging export sales is recognised in the income statement within revenue. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset (for example, inventory) or a non-financial liability, the gains and losses previously deferred in equity are transferred from equity and included in the measurement of the initial cost or carrying amount of the asset or liability.

When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gains or losses that were deferred in equity are immediately transferred to the income statement.

(s) Goodwill and intangible assets

(i) Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill on acquisitions of associates is included in investments accounted for under the equity method. Goodwill is not amortised. Instead, goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to CGUs for the purpose of impairment testing as set out in Note 13.

(ii) Trade Name

Trade name relates principally to the “Metal Management” trading name. This intangible has a finite useful life and is carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of the trade name over its estimated useful life, which is 20 years.

(iii) Supplier relationships and contracts

Supplier relationships and contracts acquired as part of a business combination are recognised separately from goodwill. The supplier relationships are carried at their fair value at the date of acquisition less accumulated amortisation and impairment losses. Amortisation is calculated based on the timing of projected cash flows of the supplier relationships or straight-line method (as appropriate) over their estimated useful lives, which currently vary from 1 to 19 years.

(iv) Permits

Permits acquired as part of a business combination are recognised separately from goodwill. The permits are carried at their fair value at the date of acquisition and are not amortised. Instead, permits are tested for impairment annually or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.

(t) Trade and other payables

These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Details relating to trade and other payables are set out in Note 15.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(u) Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the income statement over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities, which are not an incremental cost relating to the actual draw-down of the facility, are recognised as prepayments and amortised to finance costs on a straight-line basis over the term of the facility.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled, or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in other income or finance cost.

Borrowings are classified as current liabilities unless the Group has the unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date. Details relating to borrowings are set out in Note 16.

(v) Borrowing costs

Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time required to complete and prepare the asset for its intended use. Other borrowing costs are recognised as expenses in the period in which they are incurred.

(w) Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. Details relating to provisions are set out in Note 17.

Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the reporting date. The discount rate used to determine the present value reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

(x) Employee benefits

(i) Wages and salaries, annual leave and sick leave

Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of the balance sheet date are recognised in other payables in respect of employees’ services up to the balance sheet date and are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured at the rates paid or payable.

(ii) Long service leave

The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the balance sheet date. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.

F-18

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(x) Employee benefits (continued)

(iii) Superannuation, pensions and other post-retirement benefits

The Group operates or participates in a number of pension (including superannuation) schemes throughout the world. The funding of the schemes complies with local regulations. The assets of the schemes are generally held separately from those of the Group and are administered by trustees or management boards.

For defined contribution schemes or schemes operated on an industry-wide basis where it is not possible to identify assets attributable to the participation by the Group’s employees, the cost is calculated on the basis of contributions payable.

For defined benefit schemes, the cost of providing pensions is charged to the income statement so as to recognise current and past service costs, interest cost on defined benefit obligations, and the effect of any curtailments or settlements, net of expected returns on plan assets. Actuarial gains and losses are recognised directly in equity. An asset or liability is consequently recognised in the balance sheet based on the present value of defined benefit obligations, less any unrecognised past service costs and the fair value of plan assets, except that any such asset can not exceed the total of unrecognised past service costs and the present value of refunds from and reductions in future contributions to the plan.

The present value of the defined benefit obligations are calculated by independent actuaries by discounting expected future payments using market yields at the reporting date on high quality corporate bonds in countries that have developed corporate bond markets. However, where developed corporate bond markets do not exist, the discount rates are selected by reference to national government bonds. In both instances, the bonds are selected with terms to maturity and currency that match, as closely as possible, the estimated future cash flows. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Details relating to retirement benefit obligations are set out in Note 18.

(iv) Share-based payments

Share-based compensation benefits are provided to certain employees via the schemes set out in Note 24. For equity-settled share-based arrangements, the fair value is measured at grant date and recognised as an employee benefit expense with a corresponding increase in equity. For cash-settled share-based arrangements, the fair value is measured at grant date and recognised as an employee benefit expense with a corresponding increase to a liability.

The fair value at grant date is independently determined using either a binomial model or a Monte-Carlo simulation model. The model takes into account the exercise price, the term, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield, and the risk-free interest rate for the term of the grant. The fair value is adjusted to reflect market vesting conditions, but excludes the impact of any non-market vesting conditions (for example, earnings per share targets). Non-market vesting conditions are included in assumptions about the number of shares that are expected to become exercisable. At each balance sheet date, the Group revises its estimate of the number of shares that are expected to become exercisable. The employee benefit expense recognised each period takes into account the most recent estimate. The impact of the revision to original estimates, if any, is recognised in the income statement with a corresponding adjustment to equity.

(v) Termination benefits

Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after the balance sheet date are discounted to present value.

(y) Contributed equity

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Details relating to contributed equity are set out in Note 19.

F-19

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(z) Dividends

A provision is made for the amount of any dividends declared on or before the end of the financial year but not distributed at the balance sheet date. Details relating to dividends are set out in Note 21.

(aa) Earnings per share

(i) Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Group, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.

(ii) Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

Details relating to earnings per share are set out in Note 32.

(ab) Goods and services or other value-added taxes (“GST”)

Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case, it is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.

(ac) New accounting standards and interpretations

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2009 reporting periods. The Group’s assessment of the impact of these new standards and interpretations is set out below.

(i) Revised AASB 101, “Presentation of Financial Statements and AASB 2007-8, Amendments to Australian Accounting Standards arising from AASB 101” and AASB 2007-10, “ Further Amendments to Australian Accounting Standards arising from AASB 101”

The revised AASB 101 that was issued in September 2007 is applicable for annual reporting periods beginning on or after 1 July 2009. AASB 101 introduces the notion of a “complete set of financial statements”, and changes the presentation of financial statements so owner changes in equity are disclosed separately from non-owner changes in equity. All non-owner changes in equity are disclosed separately from owner changes in equity. All non-owner changes in equity “comprehensive income” will be presented either in one statement of comprehensive income or in two statements (an income statement and a statement of comprehensive income), instead of being presented in the statement of changes in equity. Additional disclosure will be made of the income tax relating to each component of other comprehensive income, and the titles of the financial statements will change although their use will not be mandatory (“balance sheet” becomes “statement of financial position”; “income statement” becomes part of the “statement of comprehensive income”, unless a separate income statement is provided; “cash flow statement” becomes “statement of cash flows”). AASB 2007-08 contains consequential amendments to disclosures required by other Australian Accounting Standards as a result of the revised AASB 101.

F-20

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 1 – Summary of significant accounting policies (continued)

(ac) New accounting standards and interpretations (continued)

(ii) AASB 2008-1, “Amendments to Australian Accounting Standard — Share-based Payments: Vesting Conditions and Cancellations”

AASB 2008-1 was issued in February 2008 and will become applicable for annual reporting periods beginning on or after 1 January 2009. The revised standard clarifies that vesting conditions are service conditions and performance conditions only and that other features of a sharebased payment are not vesting conditions. It also specifies that all cancellations, whether by the entity or by other parties, should receive the same accounting treatment. The Group will apply the revised standard from 1 July 2009, but it is not expected to affect the accounting for the Group’s share-based payments.

(iii) Revised AASB 3, “Business Combinations”, AASB 127, “Consolidated and Separate Financial Statements” and AASB 2008-3, “Amendments to Australian Accounting Standards arising from AASB 3 and AASB 127”

These standards amend the accounting for certain aspects of business combinations and changes in ownership interests in controlled entities. Consequential amendments are made to other standards, AASB 128, “Investments in Associates” and AASB 131, “Interests in Joint Ventures” . Changes include:

• transaction costs are recognised as an expense at the acquisition date, unless the cost relates to issuing debt or equity securities;

• contingent consideration is measured at fair value at the acquisition date (allowing for a 12 month period post-acquisition to affirm fair values) without regard to the probability of having to make future payment, and all subsequent changes in fair value are recognised in profit; and

• changes in control are considered significant economic events, thereby requiring ownership interests to be remeasured to their fair value (and the gain/loss recognised in profit) when control of a controlled entity is gained or lost.

The Group will apply the revised standard from 1 July 2009. Refer to Note 6.

(iv) AASB 2008-08, “Amendment to IAS 39 Financial Instruments: Recognition and Measurement”

AASB 2008-08 amends AASB 139, “Financial Instruments: Recognition and Measurement” and must be applied retrospectively in accordance with AASB 108, “ Accounting Policies, Changes in Accounting Estimates and Errors ”. The amendment makes two significant changes. It prohibits designating inflation as a hedgeable component of a fixed rate debt. It also prohibits including time value in the one-sided hedged risk when designating options as hedges. The Group will apply the amended standard from 1 July 2009. It is not expected to have a material impact on the Group’s consolidated financial statements.

(v) AASB 2008-05, “Amendments to Australian Accounting Standards arising from the Annual Improvements Project” and AASB 2008-06, “Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project”

AASB 2008-05 and AASB 2008-06 are applicable to the Group commencing on 1 July 2009. These standards make various minor amendments to other standards. However, these standards would not result in any changes to historical financial results if they were early adopted and the standards are not expected to have a material impact on the Group’s consolidated financial statements.

(ad) Rounding of amounts

The Group is of a kind referred to in Class Order 98/0100, issued by the Australian Securities and Investments Commission, relating to the “rounding off” of amounts in the financial report. Amounts in the financial report have been rounded off in accordance with that Class Order to the nearest thousand dollars, or in certain cases, the nearest dollar.

F-21

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 – Financial and capital risk management

Financial risk management

In the normal course of business, the Group’s activities result in exposure to a number of financial risks:

• market risk (including interest rate risk, foreign currency risk and commodity price risk);

• credit risk; and

• liquidity risk.

The Group’s overall financial risk management strategy seeks to mitigate these risks and reduce volatility on the Group’s financial performance.

The Group uses derivative financial instruments in certain circumstances in accordance with Board of Directors (“Board”) approved policies to hedge exposure to fluctuations in foreign exchange rates or commodity prices. Derivative financial instruments are used for hedging purposes and not as trading or other speculative instruments. The Group uses different methods to measure different types of risk to which it is exposed. These methods include monitoring key movements in interest rates, key transactions affected by foreign exchange and commodity prices, and ageing analysis for credit risk.

Risk management is carried out by a limited number of employees as authorised by the Board. The Board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and the investment of excess liquidity.

(a) Market risks

Market risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market prices. The market risks to which the Group is exposed are discussed in further detail below.

(i) Interest rate risk

Interest rate risk refers to the risk that the value of a financial instrument or cash flows associated with the instrument will fluctuate because of changes in market interest rates. The Group does not use any derivative financial instruments to manage its exposure to interest rate risk. Cash deposits and borrowings issued at fixed rates expose the Group to fair value interest rate risk.

The Group’s borrowings are sourced from both domestic and offshore markets and include short-term and long-term maturities. Some of the Group’s borrowings consist of foreign currency denominated borrowings. The Group’s regional operations borrow in the currency of their geographic locations. The Group’s borrowings are managed in accordance with targeted currency, interest rate, liquidity, and debt portfolio maturity profiles.

Specifically, interest rate risk is managed on the Group’s net debt portfolio by:

• providing access to diverse sources of funding;

• reducing risks of refinancing by establishing and managing in accordance with target maturity profiles; and

• negotiating interest rates with the Group’s banks based on a variable pricing matrix which includes a LIBOR rate plus a margin.

F-22

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 — Financial and capital risk management (continued)

(a) Market risks (continued)

(i) Interest rate risk (continued)

The table below shows the Group’s sensitivity to post-tax profit to a 1% increase in the stated interest rates. A sensitivity of 1% is deemed reasonable based on current and past market conditions. The calculations are based on interest-bearing financial instruments with variable interest rates at the balance sheet date.

Consolidated +1% (100 basis points)	Impact on post-tax profit higher/(lower)	Impact on post-tax profit higher/(lower)
	2009 A$’000 (675)	2008 A$’000
		(1,756)

+1% (100 basis points)

A 1% decrease in the stated interest rates would have an equal and opposite effect. The Parent has no exposure.

(ii) Foreign currency risk

Foreign currency risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency that is not the entity’s functional currency. The exposure of an entity to transaction risk is minimised by matching local currency income with local currency costs.

The Group seeks to denominate borrowings in the currencies of its principal assets and cash flows. These are primarily denominated in Australian dollars, US dollars, British pounds and Euro.

In accordance with Board approved policies, the Group enters into forward foreign exchange contracts to buy and sell specific amounts of various foreign currencies in the future at pre-determined exchange rates. The contracts are entered into to hedge transactions denominated in currencies which are not the functional currency of the relevant entity. These contracts are hedging highly probable forecasted transactions for the ensuing financial year. The contracts are timed to mature when monies from the forecasted sales are scheduled to be received or when payments for purchases are scheduled to be made. The Group does not hedge its exposure to recognised assets and liabilities.

Financial assets and liabilities

Financial assets and liabilities denominated in currencies other than the functional currency of an entity are periodically restated to their functional currency, and the associated gain or loss is taken to the income statement. The table below shows the carrying amount of the Group’s foreign currency denominated financial assets and liabilities at the balance sheet date.

Consolidated Currency	Net financial assets/(liabilities)	Net financial assets/(liabilities)
	2009 A$’000	2008 A$’000
US dollar	(58,294 )	18,456
Euro	(57,482)	(69,331)
British pound	49,941	4,305

The table below shows the impact of a 10% appreciation of the relevant currency for the Group’s net foreign currency denominated financial assets. A sensitivity of 10% has been selected as this is considered reasonable given the current level of exchange rates and the volatility observed both on a historical basis and market expectations for future movements.

Consolidated Impact on post-tax profit — higher/(lower) Impact on equity	US dollar 2009 2008 A$’000 A$’000 (3,789) 1,235 28,198 24,464	Euro	2008 A$’000 (4,638) —	British pound	British pound
	2009 A$’000 (3,789) 28,198	2009 A$’000 (3,736) —		2009 A$’000 3,246 —	2008 A$’000
					288 —

A 10% depreciation of the relevant currency would have an equal and opposite effect. The Parent has no exposure.

F-23

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 — Financial and capital risk management (continued)

(a) Market risks (continued)

(ii) Foreign currency risk (continued)

Forward foreign exchange contracts

The table below shows the Group’s sensitivity to foreign exchange rates on its forward foreign exchange contracts. A sensitivity of 10% has been selected as this is considered reasonable given the current level of exchange rates and the volatility observed both on a historical basis and market expectations for future movements.

Consolidated Impact on post-tax profit — higher/(lower) Impact on equity — higher/(lower)	US dollar 2009 2008 A$’000 A$’000 — — 1,703 606	Euro	2008 A$’000 — 116	British pound	British pound
	2009 A$’000 — 1,703	2009 A$’000 — 383		2009 A$’000 (3,299) 4,755	2008 A$’000 — 8,803

A 10% depreciation of the stated currencies would have an equal and opposite effect. The Parent has no exposure.

The financial statements for each of the Group’s foreign operations are prepared in local currency being their functional currency. For the purposes of preparing the Group’s consolidated financial information, each foreign operation’s financial statements are translated into Australian dollars using the applicable foreign exchange rates as at the balance date. A translation risk therefore exists on translating the financial statements of the Group’s foreign operations into Australian dollars for the purposes of reporting consolidated financial information. As a result, volatility in foreign exchange rates can impact the Group’s net assets, net profit and the foreign currency translation reserve.

(iii) Commodity price risk

The Group is exposed to risks associated with fluctuations in the market price for both ferrous and non-ferrous metals which are at times volatile. The Group attempts to mitigate commodity price risk by seeking to turn its inventories quickly instead of holding inventories in anticipation of higher commodity prices. Where appropriate, the Group enters into forward commodity contracts matched to purchases or sales of metal and precious metal commitments.

The Group’s normal policy is to sell its products at prevailing market prices. Exceptions to this rule are subject to strict limits and policies approved by the Board and to rigid internal controls and compliance monitoring. The Group’s exposure to commodity prices is to an extent diversified by virtue of its broad commodity base.

At the balance date, none of the Group’s forward commodity contracts qualified for hedge accounting, despite being valid economic hedges of the relevant risk. Accordingly, any movement in commodity rates that impact the fair value of these forward commodity contracts are recorded in the income statement.

At the balance date, the Group’s commodity contracts consisted primarily of copper and nickel contracts. The following table shows the effect on post-tax profit and equity from a 10% appreciation in commodity rates at the balance date based on the outstanding commodity contracts, with all other variables held constant. A 10% sensitivity has been selected as this is considered reasonable given the current level of commodity prices and the volatility observed both on a historical basis and on market expectations for future movements.

Consolidated Impact on post-tax profit — higher/(lower) Impact on equity — higher/(lower)	Copper prices 2009 2008 A$’000 A$’000 (4,458) — — (2,796)	Nickel prices	Nickel prices
	2009 A$’000 (4,458) —	2009 A$’000 (401) —	2008 A$’000
			(2,210) —

A 10% depreciation of the stated commodity prices would have an equal and opposite effect. The Parent has no exposure.

F-24

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 — Financial and capital risk management (continued)

(b) Credit risk

Credit risk is the risk that a contracting entity will not complete its obligations under a financial instrument and cause a financial loss to the Group. The Group has exposure to credit risk on all financial assets included in the Group’s balance sheet.

The Group establishes credit limits for its customers. Trade and other receivables consist of a large number of customers, spread across the consumer, business and international sectors. The Group does not have any significant credit risk exposure to a single customer or groups of customers. Ongoing credit evaluation is performed on the financial condition of the Group’s customers and, where appropriate, an impairment provision is raised. The Group does not insure itself against collection risks. Occasionally, the Group will sell a portion of its trade receivables to a third party under an uncommitted facility agreement. For further details refer to Note 8.

The Group is also exposed to credit risk arising from the Group’s transactions in derivative contracts. For credit purposes, there is only a credit risk where the counterparty is liable to pay the Group in the event of a closeout. The Group has policies that limit the amount of credit exposure to any financial institution. Derivative counterparties and cash transactions are limited to financial institutions that meet acceptable credit worthiness criteria. Credit risk further arises in relation to financial guarantees as set out in Note 22.

(c) Liquidity risks

Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions.

Liquidity risk includes the risk that, as a result of the Group’s operational liquidity requirements:

• the Group will not have sufficient funds to settle a transaction on the due date;

• the Group will be forced to sell financial assets at a value which is less than what they are worth;

• the Group may be unable to settle or recover a financial asset at all; or

• the Group may be required to refinance the Group’s borrowing facilities.

The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Due to the dynamic nature of the underlying businesses, the Group aims at maintaining flexibility in funding by keeping committed credit lines available with a variety of counterparties.

The Group has access to unsecured global multi-currency/multi-option loan facilities. Unsecured global multi-currency/multi-option loan facilities are provided by a number of the Group’s bankers. The loan facilities are subject to annual reviews and have maturities in excess of 1 year and less than 3 years.

The Group had access to the following credit standby arrangements at the balance date.

Unsecured global multi-currency/multi-option loan facilities Amount of credit unused	Consolidated 2009 2008 A$’000 A$’000 1,062,993 1,065,781 856,490 668,584	Parent	Parent
	2009 A$’000 1,062,993 856,490	2009 A$’000 — —	2008 A$’000
			— —

F-25

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 — Financial and capital risk management (continued)

(c) Liquidity risks (continued)

The table below analyses the Group and Parent’s financial assets and liabilities, net and gross settled derivative financial instruments into relevant maturity groupings based on the remaining period at the balance date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Consolidated				2009	Between 2 and 5 years A$’000	Between 2 and 5 years A$’000		2008
		Less than 1 year A$’000		Between 1 and 2 years A$’000				Less than 1 year A$’000		Between 1 and 5 years A$’000
Non-derivative financial liabilities:
Trade and other payables		(537,947)		—		—		(1,062,253)		—
Payables — non-current		—		(1,937 )		(2,263 )		—		(2,270 )
Borrowings (including interest payments)		(9,641)		(177,916)		—		(21,983)		(406,769)
		(547,588 )		(179,853 )		(2,263 )		(1,084,236 )		(409,039 )
Derivatives:
Net settled (commodity contracts)		9,689		—		—		(1,699 )		—
Gross settled:
- (inflow)		(174,728 )		—		—		(139,236 )		—
- outflow		174,790		—		—		139,450		—
		9,751		—		—		(1,485 )		—
Parent
Non-derivative financial liabilities:
Trade and other payables		(284,831)		—		—		(343,483)		—
		(284,831 )		—		—		(343,483 )		—

For purposes of the above table, interest payments have been projected using interest rates applicable at the balance date on borrowings outstanding at the balance date. The Group’s borrowings fluctuate and are subject to variable interest rates. Future interest payments are therefore subject to borrowings outstanding and the interest applicable at that time.

(d) Fair value estimation

The fair value of financial assets and financial liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

• Cash and cash equivalents — approximates to the carrying amount;

• Receivables less impairment provision and payables — approximates to the carrying amount due to their short-term nature;

• Derivative financial instruments — based on market prices and exchange rates at the balance date.

• Borrowings — approximates to the carrying amount as bank borrowings have floating interest rates.

All of the fair values of financial assets and liabilities in the Group are equal to their carrying values.

F-26

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 2 — Financial and capital risk management (continued)

Capital risk management

The capital structure of the Group consists of net debt and equity. The Group’s objectives when managing capital are to maintain an optimal capital structure and manage effectively the cost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The Group monitors its capital structure using the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings less cash and cash equivalents. Total capital is calculated as equity as shown in the balance sheet plus net debt. The Group seeks to maintain an optimum gearing ratio.

The Group and Parent’s gearing ratios are set out below.

	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent	Parent	Parent
	2009 A$’000		2009 A$’000			2008 A$’000
Total borrowings	175,144	398,414	—			—
Less: cash and cash equivalents	(69,536)	(133,487)	(198)			—
Net debt	105,608	264,927	(198	)		—
Plus: total equity	2,859,047	2,833,924	3,756,617			3,683,644
Total capital	2,964,655	3,098,851	3,756,419			3,683,644
Gearing ratio	3.6%	8.5%	0.0%			0.0%

Gearing ratio

There have been no breaches of external obligations such as regulatory obligations or bank covenants.

Note 3 — Critical accounting estimates and judgements

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements and estimates on historical experience and on other various factors it believes to be reasonable under the circumstances, the result of which form the basis of the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions and conditions.

Management has identified the following critical accounting policies for which significant judgements, estimates and assumptions are made. Actual results may differ from these estimates under different assumptions and conditions and may materially affect financial results or the financial position reported in future periods. Further details of the nature of these assumptions and conditions may be found in the relevant notes to the financial statements.

(i) Inventories

The Group’s inventories primarily consist of ferrous and non-ferrous scrap metals. Quantities of inventories are determined based on various inventory systems used by the Group and are subject to periodic physical verification using estimation techniques, including observation, weighing and other industry methods. Inventories are stated at the lower of cost or net realisable value, with due allowance for excess, obsolete or slow moving items. Net realisable value is based on current assessments of future demand and market conditions. Impairment losses may be recognised on inventory within the next financial year if management needs to revise its estimates in response to changing circumstances. Due to adverse market conditions in the year ended 30 June 2009, there were significant net realisable value adjustments as set out in Note 6.

F-27

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 3 — Critical accounting estimates and judgements (continued)

(ii) Taxation

The Group is subject to income taxes in Australia and jurisdictions where it has foreign operations. Judgement is required in assessing whether deferred tax assets and certain deferred tax liabilities are recognised on the balance sheet. Deferred tax assets, including those arising from unused tax losses, capital losses and temporary differences, are recognised only where it is considered more likely than not that they will be recovered, which is dependent on the generation of sufficient future taxable profits.

Assumptions about the generation of future taxable profits depend on management’s estimates of future cash flows. These depend on estimates of future sales volumes, operating costs, capital expenditure, dividends and other capital management transactions. Judgements are also required about the application of income tax legislation. These judgements are subject to risk and uncertainty, hence there is a possibility that changes in circumstances will alter expectations, which may impact the amount of deferred tax assets and deferred tax liabilities recognised on the balance sheet and the amount of other tax losses and temporary differences not yet recognised. In such circumstances, some or all of the carrying amounts of recognised deferred tax assets and liabilities may require adjustment, resulting in a corresponding credit or charge to the income statement.

(iii) Impairment of goodwill and intangibles with indefinite useful lives

The Group determines whether goodwill and intangibles with indefinite useful lives are impaired on at least an annual basis. This requires an estimation of the recoverable amount of the CGUs to which the goodwill and intangibles with indefinite useful lives are allocated. The assumptions used in this estimation of recoverable amount and the carrying amount of goodwill and intangibles with indefinite useful lives are detailed in Notes 13 and 14. In the year ended 30 June 2009, the Group impaired goodwill by A$191.1 million.

(iv) Share-based payment transactions

The Group measures the cost of equity settled transactions with employees by reference to the fair value of the equity instruments at the date of grant. The fair value is determined independently using a binomial model or a Monte-Carlo simulation model, using the assumptions detailed in Note 24. The accounting estimates and assumptions relating to equity-settled share-based payments (i.e. in relation to the assessments of the probability of achieving non-market based vesting conditions) would have no impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact expenses and equity.

(v) Defined benefit plans

Various actuarial assumptions are required when determining the Group’s pension schemes. These assumptions and the related carrying amounts are disclosed in Note 18.

(vi) Estimation of useful lives of assets

The estimation of the useful lives of assets has been based on historical experience. In addition, the condition of the assets is assessed at least annually and considered against the remaining useful life. Adjustments to useful lives are made when considered necessary.

Note 4 — Revenue

			Consolidated	Consolidated		2007 A$’000		Parent	Parent
		2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
Sales of goods		8,417,419		7,517,277		5,420,590		—		—
Service revenue		218,806		148,314		127,930		—		—
Total sales revenue		8,636,225		7,665,591		5,548,520		—		—
Interest income		2,272		2,876		2,364		—		—
Dividend income		—		—		—		231,001		170,205
Management fees		—		—		—		1,556		1,473
Rental income		2,513		2,069		13		—		—
Total other revenue		4,785		4,945		2,377		232,557		171,678
		8,641,010		7,670,536		5,550,897		232,557		171,678

F-28

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 4 — Revenue (continued)

As a consequence of the rapid and unprecedented deterioration in economic conditions and the related effects on commodity markets during the first half of the 2009 financial year, the Group renegotiated a number of non-ferrous sales contracts with its customers. Revenue is shown after the impact of these contract renegotiations, which amounted to A$36.0 million.

Note 5 — Other income

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
		2009 A$’000		2008 A$’000			2009 A$’000	2008 A$’000
Net gain on contribution of assets to SA Recycling LLC (Note 29(d))		—		38,841		—	—	—
Unrealised gain on held for trading derivatives		—		3,901		—	—	—
Realised gain on held for trading derivatives		29,857		—		—	—	—
Net gain on disposal of property, plant and equipment		864		—		401	—	—
Insurance recovery		1,786		11,815		7,632	—	—
Negative goodwill on acquisition (Note 27)		399		—		—	—	—
Net foreign exchange gains		—		243		—	—	—
Government grants		831		867		945	—	—
		33,737		55,667		8,978	—	—

Note 6 — Expenses

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
	2009 A$’000			2008 A$’000			2009 A$’000	2008 A$’000
(a) (Loss)/profit before income tax includes the following specific expenses:
Depreciation and amortisation:
Buildings		11,443		7,303		4,104	—	—
Leasehold improvements		4,594		2,765		3,686	—	—
Plant and equipment		104,706		55,728		42,840	—	—
		120,743		65,796		50,630	—	—
Amortisation of identified intangible assets		50,077		29,290		23,823	—	—
		170,820		95,086		74,453	—	—
Finance costs		21,508		34,374		30,405	—	—
Net loss on disposal of property, plant and equipment		—		1,965		—	—	—
Unrealised loss on held for trading derivatives		10,253		—		—	—	—
Rental expenses relating to operating leases		71,695		43,883		33,489	—	—
Net foreign exchange losses		48		—		59	—	—
Defined contribution superannuation expense		8,042		6,275		5,949	—	—
Share-based payment expense		9,258		13,388		2,831	—	—
Research and development		1,724		2,082		2,515	—	—

F-29

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 6 — Expenses (continued)

	Consolidated	Consolidated	2007 A$’000	Parent	Parent
	2009 A$’000	2008 A$’000		2009 A$’000	2008 A$’000
(b) (Loss)/profit before income tax includes the following expenses which are included due to their size or nature:
Write-down of inventory to net realisable value 119,418 — — —					—
Sarbanes-Oxley related professional fees1 9,661 — — —					—
Withdrawal liability related to a multi-employer pension plan2 3,422 — — —					—
Impairment provisions for trade receivables3 23,678 590 (436 ) —					—
Professional fees and other costs incurred in connection with Fairless Iron & Metal acquisition4 2,541 — — —					—
Redundancies 5,481 5,605 — —					—
Loss on sale of subsidiaries (Note 27) 2,577 — — —					—
Impairment loss on fire destroyed assets — 71 6,784 —					—
Asset impairments and yard closure costs5 13,669 4,553 — —					—
Merger costs6 4,048 1,387 — —					—

• 1

• 2

• 3

• Represents external professional fees related to the compliance with Section 404 of the Sarbanes-Oxley Act of 2002 (United States).

• Represents a termination liability associated with the withdrawal from a multi-employer pension plan in the United States.

• Represents provisions recorded for trade debtors for which the Group believes collectibility is in doubt. Refer to Note 1(m).

• 4 The acquisition of Fairless Iron & Metal was completed on 3 July 2009. As a result, the Group has applied the transitional principles consistent with the revised AASB 3 whereby transaction costs are expensed for all acquisitions prospectively from 1 July 2009. Refer to Note 1(ac)(iii).

• 5 Amounts represent the write-down of equipment as a result of asset retirements and rationalisation, write-down of an investment and costs related to yard closures.

• 6 Merger costs include integration bonuses, retention incentives and other costs associated with the post merger rationalisation of the Sims Metal Management Limited and Metal Management Inc businesses.

Note 7 — Income tax and deferred tax

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
		2009 A$’000		2008 A$’000			2009 A$’000	2008 A$’000
(a) Income tax expense
Current income tax charge/(benefit)		27,511		217,056		119,860	(353)	(391)
Adjustments for prior years		(10,284 )		5,485		176	—	—
Deferred income tax		8,326		(6,197)		(5,366)	—	—
		25,553		216,344		114,670	(353 )	(391 )
Income tax expense on equity accounted profits (Note 29)		2,580		4,161		2,281	—	—
		28,133		220,505		116,951	(353 )	(391 )
Deferred income tax expense included in income tax expense comprises:
Decrease/(increase) in deferred tax assets		15,503		9,991		(25,268 )	—	—
(Decrease)/increase in deferred tax liabilities		(7,177)		(16,188)		19,902	—	—
		8,326		(6,197 )		(5,366 )	—	—

F-30

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 7 — Income tax and deferred tax (continued)

			Consolidated	Consolidated		2007 A$’000		Parent	Parent
		2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
(b) Reconciliation of income tax expense to accounting (loss)/profit before tax
Accounting (loss)/profit before income tax		(122,162)		660,603		356,889		229,824		168,901
Tax at the standard Australian rate of 30%		(36,649 )		198,181		107,067		68,947		50,671
Adjustments for prior years		(10,284)		5,485		176		—		—
Effect of tax rates in other jurisdictions		12,039		34,407		13,004		—		—
Non-deductible expenses		3,477		3,588		787		—		—
Non-assessable gain on formation of jointly controlled entity		—		(12,983 )		—		—		—
Non-assessable income		(1,059)		(6,467)		(10)		—		—
Non-deductible goodwill impairment		57,234		—		—		—		—
Current year tax losses not previously recognised		—		(66)		(554)		—		—
Dividends received from subsidiaries		—		—		—		(69,300 )		(51,062 )
Other		3,375		(1,640)		(3,519)		—		—
Income tax expense (benefit)		28,133		220,505		116,951		(353 )		(391 )
(c) Amounts recognised directly to equity
Share-based payments		7,744		(6,875 )		—		—		—
Foreign exchange gain/(loss) on US$ receivable		20,445		(14,451)		(9,338)		—		—
Defined benefit plans		(2,715 )		(3,463 )		1,512		—		—
Cash flow hedges		(445)		(4,677)		5,559		—		—
Total deferred tax debited/(credited) to equity		25,029		(29,466 )		(2,267 )		—		—

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
(d) Deferred tax assets and liabilities
Deferred tax assets
The balance comprises temporary difference attributable to:
(amounts recognised in profit and loss):
Provisions and other accruals		22,235		5,111	—	—
Employee benefits		9,346		16,722	—	—
Stores and consumables		5,126		—	—	—
Property, plant and equipment		4,437		7,103	—	—
Jointly controlled associates		1,152		8,850	—	—
Foreign exchange losses		1,991		—	—	—
Share-based payments		7,281		20,125	—	—
Other		12,058		18,538	—	—
		63,626		76,449	—	—
(amounts recognised directly in equity):
Share-based payments		—		6,875	—	—
Defined benefit plans		4,666		—	—	—
Foreign exchange losses on US$ receivable		3,344		23,789	—	—
Other		—		2,869	—	—
		8,010		33,533	—	—

F-31

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 7 — Income tax and deferred tax (continued)

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
(d) Deferred tax assets and liabilities (continued)
Deferred tax assets (continued)
Movements
Balance at 1 July		109,982		63,221	—	—
Charged to income statement		(15,503 )		(9,991 )	—	—
Adjustments for prior years		8,682		—	—	—
Transfers to deferred tax liabilities		(17,173 )		—	—	—
Charged directly to equity		(26,115)		24,195	—	—
Acquisitions		—		38,532	—	—
Foreign exchange differences		11,763		(5,975)	—	—
Balance at 30 June		71,636		109,982	—	—
Deferred tax assets to be recovered within 12 months		41,410		23,649	—	—
Deferred tax assets to be recovered after 12 months		30,226		86,333	—	—
		71,636		109,982	—	—
Deferred tax liabilities
The balance comprises temporary differences attributable to:
(amounts recognised in profit and loss):
Intangibles		65,682		68,485	—	—
Property, plant and equipment		76,167		67,198	—	—
Other		5,976		10,973	—	—
		147,825		146,656	—	—
(amounts recognised directly in equity):
Share-based payments		869		—	—	—
Cash flow hedges		149		—	—	—
Defined benefit plans		—		1,512	—	—
		1,018		1,512	—	—
Movements
Balance at 1 July		148,168		85,516	—	—
Charged to income statement		(7,177 )		(16,188 )	—	—
Adjustments for prior years		(3,227)		—	—	—
Transfers from deferred tax assets		(17,173 )		—	—	—
Charged directly to equity		(1,088)		(5,271)	—	—
Acquisitions/disposals		942		95,733	—	—
Foreign exchange differences		28,398		(11,622)	—	—
Balance at 30 June		148,843		148,168	—	—
Deferred tax liabilities to be settled within 12 months		5,976		10,973	—	—
Deferred tax liabilities to be settled after 12 months		142,867		137,195	—	—
		148,843		148,168	—	—

F-32

Table of Contents

Notes to the Financial Statements

For the year ended 30 June 2009

Note 7 — Income tax and deferred tax (continued)

(e) Tax losses

Deferred tax assets are recognised for carried forward tax losses to the extent that realisation of the related tax benefit through future taxable profits is probable. As at 30 June 2009, the Group has unused tax losses (primarily for states in the United States) of A$55.2 million (2008: A$10.8 million) available for offset against future profits. A deferred tax asset has been recognised in respect of A$2.2 million (2008: A$0.4 million) of such losses.

The benefit of tax losses will only be obtained if (i) the Group derives future assessable income of a nature and an amount sufficient to enable the benefit from the deductions for the losses to be realised; (ii) the Group continues to comply with the conditions for deductibility imposed by tax legislation; and (iii) no changes in tax legislation adversely affects the Group in realising the benefit from the deduction for the losses.

No deferred tax asset has been recognised in respect of the remaining unused tax losses of A$39.9 million (2008: A$20.8 million) due to the unpredictability of future profit streams in the relevant jurisdictions.

(f) Unrecognised temporary differences

As at 30 June 2009, there were no unrecognised temporary differences associated with the Group’s investments in subsidiaries, associates, or jointly controlled entities, as the Group has no liability for additional taxation should unremitted earnings be remitted.

(g) Tax consolidation

Sims Metal Management Limited and its wholly-owned Australian resident subsidiaries formed a tax consolidated group with effect from 1 November 2005. Sims Metal Management Limited is the head entity of the tax consolidated group. Members of the tax consolidated group have entered into a tax sharing and funding agreement that provides for the allocation of income tax liabilities between entities should the head entity default on its tax payment obligations. No amounts have been recognised in the consolidated financial statements in respect of this agreement on the basis that the probability of default is remote.

(h) Tax effect accounting by members of the Australian tax consolidated group

Sims Metal Management Limited as the head entity and the controlled entities in the Australian tax consolidated group continue to account for their own current and deferred tax amounts. The Group has applied the group allocation approach in determining the appropriate amount of current taxes to allocate to members of the Australian tax consolidated group.

In addition to its own current and deferred tax amounts, the head entity also recognises current tax liabilities (or assets) assumed from controlled entities in the Australian tax consolidated group.

The amounts receivable or payable under the tax sharing agreement are due upon receipt of the funding advice from the head entity, which is issued as soon as practicable after the end of each financial year. The head entity may also require payment of interim funding amounts to assist with its obligations to pay tax installments.

F-33

Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 8 — Trade and other receivables

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000		2008 A$’000
Current:
Trade receivables		286,078		743,006	—		—
Provision for impairment of receivables		(8,962 )		(949 )	—		—
		277,116		742,057	—		—
Other receivables and deferred expenses		60,655		84,171	—		—
Prepayments		12,538		13,290	—		—
Net tax-related amounts receivable from subsidiaries		—		—	—		41,147
		73,193		97,461	—		41,147
		350,309		839,518	—		41,147
Non-current:
Trade receivables		7,777		—	—		—
Other		9,705		2,963	—		—
		17,482		2,963	—		—

Occasionally, the Group will sell a portion of its trade receivables to a third party under an uncommitted facility agreement. All credit risk passes to the third party at the time of the assignment, such that the Group has no further exposure to default by the specific trade debtors. The third party is not obliged to accept offers of receivables and the Group is not obligated to make offers or pay commitment fees to the third party. The Group does not generally insure trade receivables.

(a) Movements in provision for impairment of receivables

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
		2009 A$’000		2008 A$’000			2009 A$’000	2008 A$’000
Balance at 1 July		949		1,760		3,015	—	—
Acquisitions		—		145		—	—	—
Provision for impairment/(write-back) recognised during the year		23,678		590		(436 )	—	—
Receivables written-off during the year as uncollectible		(15,098)		(1,528)		(785)	—	—
Foreign exchange differences		(567 )		(18 )		(34 )	—	—
Balance at 30 June		8,962		949		1,760	—	—

The creation and release of the provision for impaired receivables has been included in other expenses in the income statement. Refer to Note 1(m).

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Notes to the Financial Statements

For the year ended 30 June 2009

Note 8 — Trade and other receivables (continued)

(b) Past due but not impaired

As at 30 June 2009, receivables of A$83.5 million (2008: A$260.2 million) were past due but not impaired and the Group does not hold any material collateral in relation to these receivables. These relate to a number of independent customers for whom there is no recent history of default.

The ageing analysis of these receivables are as follows:

Days overdue:		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
1 – 30 days		51,494		191,382	—	—
31 – 60 days		13,657		50,141	—	—
Over 60 days		18,374		18,645	—	—
		83,525		260,168	—	—

(c) Other receivables and deferred expenses

Other receivable amounts generally arise from transactions outside the usual operating activities of the Group. Interest may be charged at commercial rates where the terms of repayment exceed six months. Collateral is not normally obtained.

(d) Net tax-related amounts receivable from subsidiaries

Net tax-related amounts receivable from subsidiaries generally arise from the tax funding agreement with the Australian tax consolidated entities.

Note 9 — Inventory

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Raw materials at net realisable value		101,926		230,934	—	—
Stores and spare parts at net realisable value		36,526		29,179	—	—
Finished goods at net realisable value		330,671		750,808	—	—
		469,123		1,010,921	—	—

(a) Inventory expense

Inventories recognised as expense during the year ended 30 June 2009 amounted to A$6.4 billion (2008: A$5.4 billion). Write-downs of inventories to net realisable value are disclosed in Note 6.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 10 — Derivative financial instruments

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Current assets:
Forward foreign exchange contracts — cash flow hedges		713		33	—	—
Forward commodity contracts — held for trading		—		3,901	—	—
Forward commodity contracts — cash flow hedges		—		14	—	—
		713		3,948	—	—
Current liabilities:
Forward foreign exchange contracts — cash flow hedges		211		247	—	—
Forward commodity contracts — held for trading		9,689		—	—	—
Forward foreign exchange contracts — held for trading		564		—	—	—
Forward commodity contracts — cash flow hedge		—		2,216	—	—
		10,464		2,463	—	—

During the year ended 30 June 2009, a net after tax gain of A$0.4 million (2008: after tax loss of A$0.6 million) resulting from the change in the fair value of derivatives were taken directly to equity in the cash flow hedge reserve. These changes constitute the effective portion of the hedging relationship. Net after tax loss of A$0.6 million (2008: after tax gain of A$9.0 million) recognised in the cash flow hedging reserve were transferred to the income statement during the year ended 30 June 2009.

Note 11 — Other financial assets

Investments in controlled entities (Note 28)	Consolidated 2009 2008 A$’000 A$’000 — —		Parent	Parent
	2009 A$’000 —		2009 A$’000 4,026,774		2008 A$’000
					4,026,736

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Notes to the Financial Statements For the year ended 30 June 2009

Note 12 — Property, plant and equipment

In the current year, the Group revised its accounting policy for the valuation of land, buildings and leasehold improvements from the revaluation method to the historical cost method in accordance with AASB 116, “ Property, Plant and Equipment ”. The new policy has been applied retrospectively with the impact on comparative information in relation to the 2008 and 2007 financial years disclosed in Note 1(b)(vi).

Consolidated		Freehold land A$’000		Buildings A$’000		Leasehold improve- ments A$’000		Plant & equipment A$’000		Capital work in progress A$’000		Total A$’000
At 30 June 2009
Cost		254,506		187,006		53,808		817,684		99,502		1,412,506
Accumulated depreciation		—		(33,811 )		(17,900 )		(413,070 )		—		(464,781 )
Net book amount		254,506		153,195		35,908		404,614		99,502		947,725
Year ended 30 June 2009
Balance at 1 July		212,349		123,867		24,480		368,779		55,217		784,692
Additions		6,870		20,313		13,630		63,459		83,202		187,474
Disposals		(218)		(3,242)		—		(1,220)		—		(4,680)
Transfers		1,051		5,714		1,022		33,617		(42,684 )		(1,280 )
Impairment loss (Note 6)		—		—		—		(10,021)		—		(10,021)
Depreciation expense		—		(11,443 )		(4,594 )		(104,706 )		—		(120,743 )
Acquisition of subsidiaries (Note 27)		3,698		4,365		52		18,993		—		27,108
Disposal of subsidiaries		(1,061 )		(554 )		—		(5,443 )		—		(7,058 )
Foreign exchange differences		31,817		14,175		1,318		41,156		3,767		92,233
Balance at 30 June		254,506		153,195		35,908		404,614		99,502		947,725
At 30 June 2008
Cost		212,349		142,013		35,611		688,690		55,217		1,133,880
Accumulated depreciation		—		(18,146)		(11,131)		(319,911)		—		(349,188)
Net book amount		212,349		123,867		24,480		368,779		55,217		784,692
Year ended 30 June 2008
Balance at 1 July		150,103		89,663		26,773		239,464		35,514		541,517
Additions		8,081		2,933		10,747		49,116		58,814		129,691
Disposals		(7,153 )		(264 )		(51 )		(234 )		—		(7,702 )
Impairment loss		—		—		—		(71)		—		(71)
Transfers		9,716		17,627		1,224		13,369		(41,936 )		—
Transfer to SA Recycling (Note 29)		(31,351)		(1,378)		(10,219)		(25,614)		(2,874)		(71,436)
Depreciation expense		—		(7,303 )		(2,765 )		(55,728 )		—		(65,796 )
Acquisition of subsidiaries		98,695		29,320		1,114		165,304		9,320		303,753
Foreign exchange differences		(15,742 )		(6,731 )		(2,343 )		(16,827 )		(3,621 )		(45,264 )
Balance at 30 June		212,349		123,867		24,480		368,779		55,217		784,692

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Notes to the Financial Statements For the year ended 30 June 2009

Note 13 — Goodwill

(a) Movements in carrying amounts

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Cost		1,312,599		1,169,883	—	—
Accumulated impairment*		(165,814)		(3,349)	—	—
Net book value		1,146,785		1,166,534	—	—
Balance at 1 July		1,166,534		532,240	—	—
Transfer to SA Recycling LLC		—		(173,652 )	—	—
Impairment charge		(191,094)		(3,349)	—	—
Acquisition of subsidiaries (Note 27)		43,999		826,463	—	—
Fair value adjustments to prior year acquisitions		(587)		—	—	—
Other		(1,726 )		—	—	—
Foreign exchange differences		129,659		(15,168)	—	—
Balance at 30 June		1,146,785		1,166,534	—	—

• Accumulated impairment as at 30 June 2008 of A$3.3 million related to the Group’s Tyrecycle CGU which was sold on 30 June 2009 (refer to Note 27).

(b) Allocation of Goodwill by segment and CGU grouping

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Australasia		20,931		26,870	—	—
North America		1,005,620		1,025,617	—	—
Europe		120,234		114,047	—	—
		1,146,785		1,166,534	—	—

(c) Goodwill impairment testing

The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired as was the case during the year ended 30 June 2009. Due to the current economic environment, changes to the Group’s operating results and forecasts, and a significant reduction in the Group’s market capitalisation, the Group determined a triggering event had occurred and performed a goodwill impairment test during the period.

In accordance with AASB 136, “Impairment of Assets”, the Group performed its goodwill impairment test by comparing the recoverable amount of each CGU with its carrying amount, including goodwill. CGUs are the smallest identifiable group of assets, liabilities and associated goodwill that generate cash inflows that are largely independent of the cash inflows from other assets or groups of assets. For the purposes of assessing impairment, assets are grouped at the lowest CGU level for which there are separately identifiable cash flows. The recoverable amount of a CGU was determined based on value-in-use calculations.

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Notes to the Financial Statements

For the year ended 30 June 2009

Note 13 — Goodwill (continued)

(d) Key assumptions used for value-in-use calculations

The value-in-use calculations use a 5-year cash flow projection which is based on the 2010 financial budget (as approved by the Board) and a 4-year forecast prepared by management. A terminal value is included in the final year of the cash flow calculation. The cash flows are discounted using a rate for each CGU based on an estimate of the Group’s weighted average cost of capital adapted for the regions and currencies in which the CGUs operate. The after-tax discount rates ranged between 10.5% and 12.0% (2008: 12% for all CGUs). The current year pre-tax discount rates ranged between 12.5% and 17.0%.

The cash flow projections are based on management’s best estimates, with reference to historical results, to determine income, expenses, capital expenditures and cash flows for each CGU. These projections incorporate estimates of volumes, prices and margins. The growth rate assumptions ranged from 1.5% to 3.0% reflecting achievement of a long-term estimate of inflation in the region in which each CGU operates. The assumptions reflect past experience and also factor in current and expected economic conditions.

(e) Impairment charge

As a result of the impairment review, the Group recognised a non-cash impairment charge of A$191.1 million in the year ended 30 June 2009 (2008: A$3.3 million). The charge related to the write-off of goodwill in relation to four CGUs within the North America segment, operating in the ferrous and non-ferrous secondary recycling product groups, and one secondary processing CGU in the Australasia segment. In the event of continued adverse economic conditions in the markets in which the Group operates, the Group will continue to monitor its goodwill, indefinite-lived intangible assets and long-lived assets for possible future impairment.

(f) Impact of possible changes in key assumptions

With regard to the assessment of the value-in-use of each CGU, a sensitivity analysis was conducted on the effect of changes in forecasted cash flows and discount rates. If forecasted cash flows were to decrease by 10% for each CGU, an additional impairment charge of A$19.1 million would be required in respect of one CGU in the North America segment not currently impaired. If discount rates were to increase by 1% for each CGU, an additional impairment charge of A$39.3 million would be required in respect of two CGUs within the North America segment, one of which was impaired during the period, the other is not currently impaired.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 14 — Intangible assets

Consolidated		Supplier relation- ships A$’000		Trade names A$’000		Permits A$’000		Contracts A$’000		Other A$’000		Total A$’000
At 30 June 2009
Cost		262,937		38,329		9,759		33,350		—		344,375
Accumulated amortisation		(75,316 )		(2,481 )		—		(27,768 )		—		(105,565 )
Net book amount		187,621		35,848		9,759		5,582		—		238,810
Year ended 30 June 2009
Balance at 1 July		189,896		31,830		4,295		9,478		123		235,622
Acquisitions		7,044		—		—		708		—		7,752
Transfers		(3,403)		—		3,526		—		(123)		—
Amortisation charge		(39,967 )		(2,077 )		—		(8,033 )		—		(50,077 )
Foreign exchange differences		34,051		6,095		1,938		3,429		—		45,513
Balance at 30 June		187,621		35,848		9,759		5,582		—		238,810
At 30 June 2008
Cost		219,799		32,308		4,295		25,499		195		282,096
Accumulated amortisation		(29,903)		(478)		—		(16,021)		(72)		(46,474)
Net book amount		189,896		31,830		4,295		9,478		123		235,622
Year ended 30 June 2008
Balance at 1 July		72,287		—		7,609		13,240		1,038		94,174
Acquisitions		169,110		34,468		1,682		5,823		395		211,478
Transfer to SA Recycling LLC		(17,804 )		—		(3,957 )		—		(1,012 )		(22,773 )
Amortisation charge		(20,626)		(487)		—		(6,907)		(176)		(28,196)
Acceleration of amortisation		—		—		—		(1,094 )		—		(1,094 )
Foreign exchange differences		(13,071)		(2,151)		(1,039)		(1,584)		(122)		(17,967)
Balance at 30 June		189,896		31,830		4,295		9,478		123		235,622

Note 15 — Trade and other payables

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
		2009 A$’000				2009 A$’000		2008 A$’000
Trade payables		309,626		904,805		—		—
Other payables		219,930		153,634		255		72
Deferred income		8,391		3,814		—		—
Amounts payable to subsidiaries (including taxes payable)		—		—		284,576		343,411
		537,947		1,062,253		284,831		343,483

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 16 — Borrowings

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Current borrowings		811		877	—	—
Non-current borrowings:
Bank loans		173,394		397,081	—	—
Other borrowings		939		456	—	—
		174,333		397,537	—	—

Bank loans are unsecured but are subject to guarantees/cross guarantees, cross defaults and indemnities (as appropriate) from the Parent and some of its subsidiaries. Further information relating to interest rates, facility arrangements and fair values is set out in Note 2.

Note 17 — Provisions

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Current:
Employee entitlements		14,794		21,004	—	—
Other		7,006		7,060	—	—
		21,800		28,064	—	—
Non-current:
Employee entitlements		12,158		10,307	—	—
Environmental compliance		5,259		6,875	—	—
Contingent consideration — business combinations		14,244		17,547	—	—
Other		2,365		—	—	—
		34,026		34,729	—	—

The environmental compliance provision is an estimate of costs for property remediation that will be required in the future.

The contingent consideration provision is an estimate of final consideration payable in respect of business combinations likely to be paid in the future. The amounts are typically based on the future profitability of the businesses acquired. Refer to Note 1(j).

(a) Movements in carrying amounts

Consolidated		Current Other A$’000			Non-current	Non-current
			Contingent consider- ation A$’000		Environ- mental compliance A$’000			Other A$’000
Balance at 1 July		7,060		17,547		6,875		—
Reclassifications/transfers		(1,281)		(1,967)		—		1,967
Additional provisions recognised		1,907		1,641		—		233
Payments		(758)		—		(3,144)		(198)
Purchase accounting adjustment		—		(3,535 )		—		—
Foreign exchange differences		78		558		1,528		363
Balance at 30 June		7,006		14,244		5,259		2,365

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 18 — Retirement benefit obligations

The Group operates various defined benefit plans for certain employees. The plans provide benefits based on years of service and/or final average salary.

The following sets out details in respect of the defined benefits sections only. The expense recognised in relation to the defined contribution plans is disclosed in Note 6.

(a) Balance sheet amounts

The amounts recognised in the balance sheet are determined as follows:

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Present value of the defined benefit obligation		73,410		81,559	—	—
Fair value of defined benefit plan assets		(62,231)		(76,731)	—	—
Net liability in the balance sheet		11,179		4,828	—	—

The Group has no legal obligation to settle this liability with an immediate contribution or additional one-off contributions. The Group intends to continue to contribute to the defined benefit plans based on recommendations from its actuaries.

(b) Reconciliations

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Reconciliation of the present value of the defined benefit obligation, which is partly funded:
Balance at 1 July		81,559		69,976	—	—
Current service cost		2,167		2,012	—	—
Interest cost		5,001		3,933	—	—
Actuarial gains		(8,679 )		(535 )	—	—
Benefits paid		(9,725)		(3,333)	—	—
Contributions paid by members		471		496	—	—
Acquired in business combinations		—		14,002	—	—
Plan changes		231		—	—	—
Foreign exchange differences		2,385		(4,992)	—	—
Balance at 30 June		73,410		81,559	—	—
Reconciliation of the fair value of plan assets:
Balance at 1 July		76,731		77,430	—	—
Expected return on plan assets		5,522		5,466	—	—
Actuarial losses		(16,867 )		(11,825 )	—	—
Contributions by Group		3,815		2,147	—	—
Contributions paid by members		471		496	—	—
Benefits paid		(9,725)		(3,333)	—	—
Acquired in business combinations		—		12,468	—	—
Foreign exchange differences		2,284		(6,118)	—	—
Balance at 30 June		62,231		76,731	—	—

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 18 — Retirement benefit obligations (continued)

(c) Amounts recognised in the income statement

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
		2009 A$’000		2008 A$’000			2009 A$’000	2008 A$’000
Current service cost		2,167		2,012		2,663	—	—
Interest cost		5,001		3,933		3,921	—	—
Curtailment/settlement gain		—		—		(1,726 )	—	—
Expected return on plan assets		(5,522)		(5,466)		(4,968)	—	—
Total included in employee benefits expense		1,646		479		(110 )	—	—
Actual return on plan assets		(11,345)		(6,359)		8,922	—	—

(d) Amounts recognised in statements of recognised income and expense

			Consolidated	Consolidated		2007 A$’000	Parent	Parent
		2009 A$’000		2008 A$’000			2009 A$’000	2008 A$’000
Actuarial (loss)/gain recognised in the year		(8,188 )		(11,290 )		6,723	—	—
Deferred tax		2,715		3,463		(1,512)	—	—
Defined benefit plan actuarial (loss)/gain, net of tax		(5,473 )		(7,827 )		5,211	—	—
Cumulative actuarial (losses)/gains (gross of tax) recognised in the statement of recognised income and expense		(13,941)		(5,753)		5,537	—	—

(e) Categories of plan assets

The major categories of plan assets are as follows:

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Cash		15,504		18,816	—	—
Equity instruments		36,360		41,498	—	—
Debt instruments		7,022		9,675	—	—
Property		3,345		6,005	—	—
Other assets		—		737	—	—
Total plan assets		62,231		76,731	—	—

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 18 — Retirement benefit obligations (continued)

(f) Principal actuarial assumptions

		Consolidated
	2009 %	2008 %	2007 %
Australia
Discount rate	4.6	5.5	5.3
Expected rate of return on plan assets	8.0	8.0	8.0
Future salary increases	3.0	5.0	5.0
United Kingdom
Discount rate	6.2	6.2	5.8
Expected rate of return on plan assets	6.1	6.4	5.8
Future salary increases	4.0	5.0	4.8
United States
Discount rate	6.5	6.0	—
Expected rate of return on plan assets	8.0	8.0	—
Future salary increases	3.5	3.5	—

The expected rate of return on plan assets has been based on historical and future expectations of returns for each of the major categories of asset classes as well as the expected and actual allocation of plan assets to these major categories. This resulted in the selection of the weighted average returns of plan assets for each of the defined benefit plans as set out above.

(g) Employer contributions

Employer contributions to the defined benefit section of the plans are based on recommendations by the plan’s actuaries. Actuarial assessments are made at no more than one year intervals, and the last such assessment was made as at 30 June 2009. The objective of funding is to ensure that the benefit entitlements of members and other beneficiaries are fully funded by the time they become payable. To achieve this objective, the actuaries have adopted a method of funding benefits known as the aggregate funding method. This funding method seeks to have benefits funded by means of a total contribution which is expected to be a constant percentage of members’ salaries over their working lifetimes.

Using the funding method described above and particular actuarial assumptions as to the plan’s future experience, the actuaries recommended, in their review as at 30 June 2009, a contribution amount that would be sufficient to meet the Group’s obligations to the defined benefit scheme. Total employer contributions expected to be paid by Group companies for the 2010 financial year is A$4.3 million for Australia, A$0.7 million for United Kingdom, and A$0.2 million for the United States.

(h) Historic summary

Consolidated		2009 A$’000		2008 A$’000		2007 A$’000		2006 A$’000		2005 A$’000
Defined benefit plan obligation		73,410		81,559		69,976		87,062		82,913
Plan assets		(62,231)		(76,731)		(77,430)		(82,232)		(60,720)
Deficit/(surplus)		11,179		4,828		(7,454 )		4,830		22,193
Experience adjustments arising on plan liabilities		(8,679)		(535)		(2,769)		(2,602)		9,687
Experience adjustments arising on plan assets		16,867		11,825		(3,954 )		(3,319 )		(2,580 )

F-44

Table of Contents

Notes to the Financial Statements

For the year ended 30 June 2009

Note 19 — Contributed equity

(a) Share capital

Ordinary shares — fully paid

	Consolidated 2009 2008 A$’000 A$’000 2,352,928 2,325,924	Consolidated 2009 2008 A$’000 A$’000 2,352,928 2,325,924		Parent	Parent
	2009 A$’000 2,352,928			2009 A$’000 3,673,584		2008 A$’000
						3,646,580

Ordinary shares trade on the Australian Securities Exchange (“ASX”) and entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of shares held. Voting rights attaching to the ordinary shares are, on a show of hands, one vote for every person present as a member, proxy, attorney or representative thereof and, on a poll, one vote per share for every member present in person or by proxy, attorney or representative. Ordinary shares have no par value. The Company’s shares also trade on the New York Stock Exchange in the form of American Depositary Shares (“ADS”) with one ordinary share equaling one ADS. ADSs have the same rights as ordinary shares including participation in dividends and voting rights.

Refer to the accounting policy in Note 1 relating to the basis of preparation for the Parent entity.

(b) Movements in ordinary shares

		Number of Shares		Consolid- ated A$’000		Parent A$’000
Balance at 1 July 2007		125,851,663		811,976		2,132,632
Issued under long-term incentive plans		176,142		—		—
Issued under the employee share plan recognised as issued following repayment of associated employee loans		82,659		1,491		1,491
Issued on acquisition of Metal Management Inc		53,473,817		1,490,090		1,490,090
Issued under the dividend reinvestment plan		617,417		18,123		18,123
Issued on exercise of share options		215,250		4,244		4,244
Balance at 30 June 2008		180,416,948		2,325,924		3,646,580
Issued under long-term incentive plans		257,282		—		—
Issued under the employee share plan recognised as issued following repayment of associated employee loans		27,838		442		442
Issued under the dividend reinvestment plan		1,384,554		26,562		26,562
Shares issued to employees for integration bonus		60,096		—		—
Balance at 30 June 2009 for accounting purposes		182,146,718		2,352,928		3,673,584
Issue of ordinary shares under the employee share scheme deemed to be options for accounting purposes		80,851		—		—
Balance at 30 June 2009 per share register		182,227,569		2,352,928		3,673,584

(c) Employee share scheme and other share ownership plans

Further details on the employee share scheme as well as other share ownership plans are set out in Note 24.

(d) Dividend reinvestment plan

The Company has established a dividend reinvestment plan under which holders of ordinary shares may elect to have all or part of their dividend entitlements satisfied by issue of new ordinary shares rather than by being paid cash. Shares issued in the year ended 30 June 2009 under the plan were at a 2.5% discount to the market price.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 20 — Reserves and retained profits

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
		2009 A$’000				2009 A$’000		2008 A$’000
(a) Reserves
Share-based payments reserve		38,426		36,141		38,426		36,141
Cash flow hedging reserve		391		(607 )		—		—
Foreign currency translation reserve		127,228		(209,869)		—		—
		166,045		(174,335 )		38,426		36,141
(b) Movements in reserves
Share-based payments reserve
Balance at 1 July		36,141		5,355		36,141		5,355
Share-based payment expense		9,258		13,388		9,258		13,388
Shares issued to employees for integration bonus		771		—		771		—
Share options assumed from Metal Management Inc		—		10,523		—		10,523
Deferred tax on current year movements		(7,744)		6,875		(7,744)		6,875
Balance at 30 June		38,426		36,141		38,426		36,141
Hedging reserve — cash flow hedges
Balance at 1 July		(607 )		9,049		—		—
Revaluation		540		(13)		—		—
Deferred tax on revaluation		(149 )		(594 )		—		—
Transfer to net profit — gross		13		(14,320)		—		—
Deferred tax on transfer to net profit		594		5,271		—		—
Balance at 30 June		391		(607)		—		—
Foreign currency translation reserve
Balance at 1 July		(209,683)		(79,069)		—		—
Currency translation differences arising during the year		336,911		(130,800 )		—		—
Balance at 30 June		127,228		(209,869)		—		—

(c) Nature and purpose of reserves

(i) Share-based payment reserve

The share-based payments reserve is used to recognise the fair value of share-based awards issued to employees.

(ii) Hedging reserve

The hedging reserve is used to record gains or losses on a hedging instrument in a cash flow hedge that are recognised directly in equity, as described in Note 1(r). Amounts are recognised in profit and loss when the associated hedged transaction affects profit and loss.

(iii) Foreign currency translation reserve

Exchange differences arising on translation of investment in the net assets of foreign controlled entities are taken to the foreign currency translation reserve, as described in Note 1(e). The reserve is recognised in profit and loss when the net investment is disposed or borrowings forming part of the net investment are repaid.

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Table of Contents

Notes to the Financial Statements

For the year ended 30 June 2009

Note 20 — Reserves and retained profits (continued)

(d) Retained profits

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
		2009 A$’000				2009 A$’000		2008 A$’000
Balance at 1 July		682,335		420,734		923		6,343
Effect of accounting policy change		—		4,042		—		—
Restated balance at 1 July		682,335		424,776		923		6,343
(Loss)/profit after tax		(150,295)		440,098		230,177		169,292
Dividends paid		(186,493 )		(174,712 )		(186,493 )		(174,712 )
Actuarial loss on defined benefit plans, net of tax		(5,473)		(7,827)		—		—
Balance at 30 June		340,074		682,335		44,607		923

Note 21 — Dividends

			Consolidated	Consolidated		2007 A$’000		Parent	Parent
		2009 A$’000		2008 A$’000				2009 A$’000		2008 A$’000
(a) Recognised amounts
Declared and paid during the year
Interim dividend 2009 paid at 28 cents per share franked 100% at a 30% tax rate		50,924		—		—		50,924		—
Final dividend 2008 paid at 75 cents per share franked 23% at a 30% tax rate		135,569		—		—		135,569		—
Interim dividend 2008 paid at 55 cents per share franked 47% at a 30% tax rate		—		99,013		—		—		99,013
Final dividend 2007 paid at 60 cents per share franked 51% at a 30% tax rate		—		75,699		—		—		75,699
Interim dividend 2007 paid at 60 cents per share franked 57% at a 30% tax rate		—		—		75,240		—		—
Final dividend 2006 paid at 60 cents per share franked 51% at a 30% tax rate		—		—		74,782		—		—
Total dividends paid		186,493		174,712		150,022		186,493		174,712
Shares issued under the dividend reinvestment plan		(26,562)		(18,123)		(29,996)		(26,562)		(18,123)
Total cash dividends paid		159,931		156,589		120,026		159,931		156,589

(b) Dividends not recognised at year end

Since the end of the year, the Directors have determined the payment of a final dividend of 10 cents per share franked at 100% based on a 30% tax rate. The aggregate amount of the proposed dividend expected to be paid on 26 October 2009 out of consolidated retained profits as at 30 June 2009, but not recognised as a liability at year end is A$18.2 million (2008: A$135.4 million; 2007: A$75.7 million).

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 21 — Dividends (continued)

(c) Franked dividends

The franked portions of the final dividends recommended after 30 June 2009 will be franked out of existing franking credits or out of franking credits arising from the payment of income tax in the year ended 30 June 2010.

Franking credits available for the subsequent financial year based on tax rate of 30% (2008: 30%)		Parent	Parent
		2009 A$’000 27,515		2008 A$’000
				47,786

The above amounts represent the balances of the franking accounts at year end, adjusted for:

• franking credits that will arise from the payment of income tax payable as at 30 June 2009;

• franking debits that will arise from the payment of dividends recognised as a liability as at the reporting date; and

• franking credits that will arise from the receipt of dividends recognised as receivables at the reporting date.

The impact on the franking account of the dividend determined by the Directors since year end, but not recognised as a liability at year end, will be a reduction in the franking account of A$7.8 million (2008: A$13.4 million).

Note 22 — Contingencies

Details of contingent liabilities for which no amounts are recognised in the consolidated financial statements are detailed below.

(a) Guarantees

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
		2009 A$’000				2009 A$’000		2008 A$’000
Bank guarantees — subsidiaries		64,274		22,869		54,752		22,869
Borrowing guarantee — SA Recycling LLC		83,880		129,857		83,880		129,857
Total guarantees		148,154		152,726		138,632		152,726

The Parent entity, subsidiaries, joint venture operations, jointly controlled entities and associated companies have given a number of guarantees in respect of the performance of contracts and workers compensation insurance entered into in the ordinary course of business.

(b) Environmental claims

The Group is subject to comprehensive environmental requirements relating to, among others, the acceptance, storage, treatment, handling and disposal of solid waste and hazardous waste, the discharge of materials into air, the management and treatment of wastewater and storm water, and the remediation of soil and groundwater contamination. As a consequence, the Group has incurred and will continue to incur environmental costs and liabilities associated with site and facility operation, closure, remediation, monitoring and licensing. Provisions have been made in respect of estimated environmental liabilities where obligations are known to exist and can be reasonably measured. However, additional liabilities may emerge due to a number of factors including changes in environmental laws and regulations in each of the jurisdictions in which the Group operates or has operated. The Group cannot predict the extent to which it may be affected in the future by any such changes in legislation or regulation.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 22 — Contingencies (continued)

(c) Legal claims

Various Group companies are parties to legal actions and claims that arise in the ordinary course of their business. While the outcome of such legal proceedings cannot be readily foreseen, the Group believes that they will be resolved without material effect on its financial position. Provision has been made for known obligations where the existence of the liability is probable and can be reasonably estimated.

(d) Tax audits

The Group files income tax returns in many jurisdictions throughout the world. Various tax authorities are currently reviewing or auditing the Group’s income tax returns. Tax returns contain matters that could be subject to differing interpretations of applicable tax laws and regulations. While it is difficult to predict the ultimate outcome in some cases, the Group does not anticipate that there will be any material impact upon the Group’s financial position.

(e) Subsidiaries

Under the terms of a Deed of Cross Guarantee entered into in accordance with ASIC Class Order 98/1418 (as amended by Class Orders 98/2107, 00/0321, 01/1087, 02/0248 and 02/1017), the Parent entity has undertaken to meet any shortfall which might arise on the winding up of controlled entities which are party to the deed as described in Note 28. The controlled entities are not in liquidation and there is no indication that they will be wound up.

Note 23 — Commitments

(a) Capital commitments

Capital expenditure contracted for at the reporting date but not recognised as liabilities is as follows:

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
Payable within 1 year		34,197		24,624	—	—
Payable later than 1 year but not later than 5 years		465		935	—	—
		34,662		25,559	—	—

The capital commitments included above also include the Group’s share relating to joint venture operations, jointly controlled entities and associates.

(b) Lease commitments

The Group has entered into various operating leases on property, plant and equipment. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated. Lease commitments for operating leases are as follows:

		Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent
		2009 A$’000				2009 A$’000	2008 A$’000
Not later than one year		69,806		60,010		1,140	—
Later than one, but not later than three years		107,516		90,661		3,908	—
Later than three, but not later than five years		53,163		39,841		3,908	—
Later than five years		127,855		61,695		50,387	—
Total lease commitments not recognised as liabilities		358,340		252,207		59,343	—

The above amounts include the Group’s share of joint ventures, jointly controlled entities and associates.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 23 — Commitments (continued)

(b) Lease commitments (continued)

Parent lease commitment

On 29 May 2009, the Parent entered into a lease agreement for property in the United States. The property will be sub-leased to a Group subsidiary in the United States. Lease payments will not commence until the 2010 financial year as the lessor is making improvements to the property.

Note 24 — Share ownership plans

The Company has a number of share ownership plans in operation which are designed to link the rewards of eligible employees to the longterm performance of the Company and the returns generated for shareholders. The maximum number of shares that can be outstanding at any time under the share ownership plans is limited to 5% of the Company’s issued capital. Grants under the various share ownership plans can be in the form of options, performance rights (“Rights”) or restricted share units (“RSUs”). Certain share ownership plans also provide for cashsettled rights which are determined by the Board or employee at the date of grant.

An option is a contract that gives the holder the right, but not the obligation to acquire the Company’s shares at a fixed or determinable price for a specified period of time. Rights and RSUs are a contractual right to acquire the Company’s shares for nil consideration. Holders of options, Rights or RSUs are not entitled to dividends or voting rights.

(a) Non-executive Director (“NED”) Share Plan

Participation in the NED Share Plan is voluntary and all NED’s are eligible to participate. Under the NED Share Plan, NED’s elect to sacrifice all or part of their director fees in return for an allocation of fully paid ordinary shares of equivalent value. The NED Share Plan therefore does not involve any additional remuneration for participating NED’s.

Shares are allocated quarterly and are either issued as new shares or purchased on the ASX at the prevailing market price. In the year ended 30 June 2009, 2,640 shares (2008: 1,674 shares) were allocated to participating NED’s.

(b) 2009 Long Term Incentive Plan (“2009-LTIP”)

Under the 2009-LTIP, eligible employees may be invited to receive an award of options, Rights or RSUs. Options have an exercise price based on the prevailing market price of the Company’s ordinary shares (or ADSs) at the time of grant. Awards under the 2009-LTIP may vest either based on continuous service or based on performance conditions. Refer to the Remuneration Report for further information on the terms of the grants made in the year ended 30 June 2009 pursuant to the 2009-LTIP.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(b) 2009 Long Term Incentive Plan (continued)

Details of the awards outstanding under the 2009-LTIP are as follows:

Grant date	Expiry date	Expiry date	Exercise price	Exercise price	Balance at start of the year	Balance at start of the year	Granted during the year	Granted during the year	Exercised during the year	Exercised during the year	Forfeited during the year	Forfeited during the year	Balance at end of the year	Balance at end of the year	Vested and exercisable at end of the year
Ordinary shares:
Options:
24 Nov 08	24 Nov 15		A$ 13.11		—		135,435		—		—		135,435		—
2 Apr 09	2 Apr 16		A$ 17.79		—		135,831		—		—		135,831		—
17 Jun 09	17 Jun 16		A$ 25.22		—		287,526		—		—		287,526		—
Total					—		558,792		—		—		558,792		—
Weighted average exercise price					A$ 0.00		A$ 20.48		A$ 0.00		A$ 0.00		A$ 20.48		A$ 0.00
Rights:
24 Nov 08 30 Jun 13			—		—		44,440		—		—		44,440
2 Apr 09 30 Jun 13			—		—		49,345		—		—		49,345
23 Jun 09 1 Jul 12			—		—		5,000		—		—		5,000
Total					—		98,785		—		—		98,785
ADS:
Options:
24 Nov 08 24 Nov 15			US$ 8.39		—		181,654		—		—		181,654		—
2 Apr 09 2 Apr 16			US$ 12.19		—		284,908		—		—		284,908		—
17 Jun 09 17 Jun 16			US$ 20.73		—		715,910		—		—		715,910		—
Total					—		1,182,472		—		—		1,182,472		—
Weighted average exercise price					US$ 0.00		US$ 16.78		US$ 0.00		US$ 0.00		US$ 16.78		US$ 0.00
Rights:
24 Nov 08 30 Jun 13			—		—		61,092		—		—		61,092
2 Apr 09 30 Jun 13			—		—		125,385		—		—		125,385
30 Jun 09 1 Apr 12			—		—		11,562		—		—		11,562
Total					—		198,039		—		—		198,039

The weighted average remaining contractual life of total options outstanding as at 30 June 2009 was 6.82 years.

The fair value of options granted were independently determined using a Binomial method which allowed for the effects of an early exercise for vested options assuming the share price exceed one and a half times the exercise price. The fair value of Rights granted were independently determined using a Black-Scholes method to produce a Monte-Carlo simulation model which allows for the incorporation for a Total Shareholder Return (“TSR”) performance condition that must be met before the Rights vest.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(b) 2009 Long Term Incentive Plan (continued)

The following weighted average assumptions were used to determine the fair value of options and Rights granted:

2009:	Options Ordinary shares ADS	Options Ordinary shares ADS	Rights	Rights
	Ordinary shares		Ordinary shares	ADS
Risk-free interest rate	4.7 %	3.0 %	4.1 %	2.5 %
Dividend yield	3.9%	3.9%	4.0%	4.0%
Volatility	46.3 %	55.7 %	44.6 %	54.0 %
Expected life (years)	4.3	4.3	5.0	5.0
Share price at grant date	A$ 20.10	US$ 16.07	A$ 15.48	US$ 11.78
Fair Value	A$ 6.27	US$ 5.48	A$12.42	US$ 8.81

(c) 2008 Long Term Incentive Plan (“2008-LTIP”)

Rights were issued to eligible employees in the year ended 30 June 2008. The Rights vest in line with achievement of continuous service and, in respect of 50% of an award of Rights, market based performance criteria and, for the remaining 50%, non-market based performance criteria. The continuous service criterion is met if the participant is an employee of the Group at vesting, generally three years from the date of grant. Market based performance criteria are satisfied if the Group’s TSR over the three financial years from 1 July 2007 is at the 51st percentile or higher against a comparator group of companies. Non-market based performance criteria are satisfied if the growth in diluted earnings per share (“EPS”) of the Group over the three financial years from 1 July 2007 is between 5% and 10% when assessed against the Group’s EPS for the year ended 30 June 2007.

Special one-time Rights were also granted to certain employees who were employees of the Group in the 2003 financial year so that they were not disadvantaged in transitioning to the 2008-LTIP. These Rights vest in three tranches, with the first two tranches vesting one year and two years, respectively, from the grant date, and subject to the Group achieving EPS growth of between 5% and 10% over the five financial years from 1 July 2003 to 30 June 2008 for the first tranche and from 1 July 2004 to 30 June 2009 for the second tranche respectively. The third tranche vests in accordance with the criteria outlined in the paragraph above.

Rights granted to employees within the Sims Recycling Services (“SRS”) division have 50% of their award subject to an SRS Earnings before Interest, Tax, Depreciation and Amortisation (“EBITDA”) performance hurdle in lieu of an EPS hurdle. The EBITDA performance hurdle is determined by reference to SRS’ cumulative compound EBITDA growth for the three financial years from 1 July 2007 (which must be at least 15%, and is then pro-rated between 15% and 25%) when assessed against SRS’ EBITDA in the year ended 30 June 2007. If any of these rights remain unvested at the end of year three for the first and second tranche, then they will be retested over the four year performance period concluding at the end of year four. If any Rights remain unvested at the end of year four, they will be retested over the five year performance period concluding at the end of year five. There are no additional grants being made pursuant to the 2008-LTIP.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(c) 2008 Long Term Incentive Plan (continued)

Details of the Rights outstanding are as follows:

Grant date	Expiry date	Fair value per share at grant date A$	Balance at start of the year	Granted during the year	Vested during the year	Forfeited during the year	Balance at end of the year
2009:
25 Sept 07	1 Sept 08	$ 31.62	159,016	—	(156,969)	(2,047)	—
25 Sept 07	1 Sept 09	$ 29.78	167,822	—	—	(4,146 )	163,676
25 Sept 07	1 Sept 12	$24.02–28.04	480,122	—	—	(21,401)	458,721
Totals — 2009			806,960	—	(156,969 )	(27,594 )	622,397
Totals — 2008			—	806,960	—	—	806,960

The fair value of the Rights with market based performance conditions was independently determined using a Black-Scholes methodology to produce a Monte-Carlo simulation model which allows for the incorporation for a TSR performance condition that must be met before the Rights vest. Rights with non-market based performance conditions do not take into account the performance condition. Key assumptions included expected volatility of 32%, a dividend yield of 6.0%, a risk free rate of 6.38%, an expected life of 1 to 5 years and a share price at valuation date of A$33.10.

(d) Former Executive Long Term Incentive Plan (“Former LTIP”)

Prior to 30 June 2008, share awards were pursuant to the Former LTIP. The Former LTIP had three components: (i) employee share plan; (ii) RSUs; and (iii) Rights. No further grants are being made pursuant to the Former LTIP.

(i) Employee share plan

Offers of shares under the employee share plan were made to eligible Australian based employees in the 2006 and 2007 financial years. The Company provided financial assistance in the form of a share secured non-interest bearing employee loan. The loan is repayable in full within five years after the financial assistance is provided or such longer period and in such a manner as the Company may determine.

The beneficial ownership of the shares vest with employees in line with achievement of continuous service and non-market based performance criteria. The continuous service criterion is met if the “Participant” is an employee of the Group at vesting. Periods of continuous service vary from one to three years, while non-market based performance criteria are satisfied if the growth in EPS of the Group of between 5% and 10% is achieved over periods which vary between three and five years. There is no reward if less than 5% EPS growth is achieved. Holders of these shares are entitled to dividends over the term of the relevant vesting period.

Set out below is a summary of the employee share plan:

Grant date	Expiry date	Exercise price A$	Balance at start of the year	Granted during the year	Exercised during the year	Forfeited during the year	Balance at end of the year	Vested and exercisable at end of the year
2009:
22 Jul 05	22 Jul 10	$ 14.99	44,286	—	(21,081)	—	23,205	23,205
28 Jul 06	28 Jul 11	$ 18.73	64,403	—	(6,757 )	—	57,646	23,626
Totals — 2009			108,689	—	(27,838)	—	80,851	46,831
Weighted average exercise price			$ 17.21	$ 0.00	$ 15.90	$ 0.00	$ 17.66	$ 16.88
Totals — 2008			191,348	—	(82,659)	—	108,689	46,818
Weighted average exercise price			$ 17.56	$ 0.00	$ 18.03	$ 0.00	$ 17.21	$ 17.42

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(d) Former Executive Long Term Incentive Plan (continued)

(ii) Restricted share units

RSUs were issued to eligible US based employees. For RSUs issued on 28 July 2006, the vesting is based on both continuous service and nonmarket based performance criteria. Non-market based performance criteria are satisfied if the growth in EPS of the Group is between 5% and 10% over the period of three financial years commencing on 1 July 2006. There is no reward if less than 5% EPS growth is achieved. All other RSUs granted vest based on continuous service which is generally 3 years. Holders of RSUs are not entitled to dividends over the term of the relevant vesting period.

Set out below is a summary of RSUs granted under the Former LTIP:

Grant date	Expiry date	Fair value per share at grant date A$	Balance at start of the year	Granted during the year	Vested during the year	Forfeited during the year	Balance at end of the year
2009:
1 Nov 05	1 Jul 09	$ 14.72	107,506	—	(58,730)	—	48,776
28 Jul 06	1 Sep 09	$ 7.66	11,028	—	—	(2,380 )	8,648
3 Mar 08	31 Aug 11	$ 29.81	13,735	—	—	—	13,735
Totals — 2009			132,269	—	(58,730 )	(2,380 )	71,159
Totals — 2008			232,011	53,552	(123,431)	(29,863)	132,269

The fair value of the RSUs granted on 3 March 2008 was based on the Company’s share price on the date of grant and was discounted by the Company’s dividend yield of 4.2%.

(iii) Performance rights

For the Rights granted on 1 July 2007 and 17 September 2007, the vesting is based on continuous service until 30 April 2010. For all other Rights, vesting is based on continuous service and achieving non-market based performance criteria. Continuous service varies from one to three years, while non-market based performance criteria are satisfied if the growth in EPS of the Group is between 5% and 10% over periods which vary between three and five years.

Set out below is a summary of Rights issued pursuant to the Former LTIP:

Grant date	Expiry date	Fair value per share at grant date A$	Balance at start of the year	Granted during the year	Vested during the year	Forfeited during the year	Balance at end of the year
2009:
31 Oct 05	30 Oct 10	$ 16.68	71,947	—	(23,983)	—	47,964
18 Nov 05	30 Oct 08	$ 16.68	14,989	—	(14,989 )	—	—
10 Jul 06	30 Jun 09	$ 19.15	7,833	—	(2,611)	(5,222)	—
28 Jul 06	1 Sep 09	$ 7.66	3,579	—	—	—	3,579
1 Jul 07	30 Apr 10	$ 22.26	44,803	—	—	—	44,803
17 Sep 07	30 Apr 10	$ 27.27	42,088	—	—	—	42,088
Totals — 2009			185,239	—	(41,583)	(5,222)	138,434
Totals — 2008			152,711	86,891	(52,711 )	(1,652 )	185,239

The fair value of the Rights granted in the year ended 30 June 2008, which vest only based on continuous service, was based on the Company’s share price on the date of grant and was discounted by the Company’s dividend yield of 6.0%.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(e) Transition Incentive Share Plan related to the Metal Management Inc Merger

In accordance with the terms and conditions of the merger agreement with Metal Management Inc, the Sims Group Limited Transition Incentive Plan (“SGLTIP”) was established. The SGLTIP assumed the rights and obligations of Metal Management Inc under its former plan (“MMI Plan”). The Group assumed both options and restricted shares from the MMI Plan. No additional grants can be made under the SGLTIP.

(i) Share options

The options assumed were held by the former directors of Metal Management Inc who became Directors of the Company on the merger date. Each outstanding share option under the MMI Plan was converted into 2.05 options of the Company. Each option represents the right to acquire one ADS. In addition, the exercise price of each outstanding option under the MMI Plan was converted at the same exchange ratio. All the options assumed were fully vested and therefore the fair value was recorded as a component of the purchase price for Metal Management Inc.

Set out below is a summary of options under the SGLTIP:

Grant date	Expiry date	Exercise price US$	Balance at start of the year	Assumed during the year	Exercised during the year	Forfeited during the year	Balance at end of the year	Vested and exercisable at end of the year
2009:
14 Mar 08	16 Jan 14	$ 8.57	61,500	—	—	—	61,500	61,500
14 Mar 08	16 Apr 14	$ 8.76	20,500	—	—	—	20,500	20,500
14 Mar 08	16 Jan 14	$ 12.81	205,000	—	—	—	205,000	205,000
14 Mar 08	7 Apr 11	$ 15.29	123,000	—	—	—	123,000	123,000
14 Mar 08	16 Jan 14	$ 17.08	205,000	—	—	—	205,000	205,000
14 Mar 08	28 Apr 12	$ 22.55	123,000	—	—	—	123,000	123,000
Totals — 2009			738,000	—	—	—	738,000	738,000
Weighted average exercise price			$ 15.54	$ 0.00	$ 0.00	$ 0.00	$ 15.54	$ 15.54
Totals — 2008			—	953,250	(215,250)	—	738,000	738,000
Weighted average exercise price			$ 0.00	$ 16.31	$ 34.58	$ 0.00	$ 15.54	$ 15.54

No options were exercised during the year ended 30 June 2009. For options exercised during the year ended 30 June 2008, the weighted average share price was US$34.58. The weighted average remaining contractual life of options outstanding as at 30 June 2009 was 3.80 years (2008: 4.80 years). The weighted average fair value of options assumed was A$11.04 per share and was calculated taking into account the value of an ordinary share on the merger date, the exercise price of each option and the remaining term of each option. Other key assumptions included the risk free interest rate, which ranged from 5.99% to 6.15%, a dividend yield of 4.2%, and a volatility of 34%.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 24 — Share ownership plans (continued)

(e) Transition Incentive Share Plan related to the Metal Management Inc Merger (continued)

(ii) Restricted shares

The restricted shares assumed were held by former employees of Metal Management Inc who are now employed by the Group. The restricted shares vest evenly over three years based on continuous service. The holder of the restricted share is entitled to dividends and voting rights during the period of restriction. Each unvested restricted share at the merger date was converted into 2.05 restricted ADS of the Company. The fair value of restricted shares assumed was based on the value of an ordinary share of the Company on the merger date.

Set out below is a summary of restricted shares under the SGLTIP:

Grant date	Expiry date	Fair value per share at grant date US$	Balance at start of the year	Assumed during the year	Vested during the year	Forfeited during the year	Balance at end of the year
2009:
14 Mar 08	14 Mar 09	$ 25.27	83,150	—	(78,025)	(5,125)	—
14 Mar 08	14 Mar 10	$ 25.27	83,159	—	—	(12,027 )	71,132
14 Mar 08	14 Mar 11	$ 25.27	83,176	—	—	(12,027)	71,149
Totals — 2009			249,485	—	(78,025 )	(29,179 )	142,281
Totals — 2008			—	256,250	—	(6,765)	249,485

(f) Effect of share-based payments on profit and loss

The expense recognised in the income statement in relation to share-based payments is disclosed in Note 6. The carrying amount of liabilities for cash-settled share-based arrangements as at 30 June 2009 was A$144,000 (2008: $282,000).

Note 25 — Key management personnel disclosures

Key management personnel are those persons defined as having authority and responsibility for planning, directing and controlling the activities of the Group, either directly or indirectly, including any director (executive or non-executive). Please refer to the Directors Report for information regarding each key management person.

(a) Key management personnel compensation

	Consolidated 2009 2008 A$ A$	Consolidated 2009 2008 A$ A$	Consolidated 2009 2008 A$ A$	Consolidated 2009 2008 A$ A$	Consolidated 2009 2008 A$ A$	Parent	Parent	Parent
	2009 A$					2009 A$		2008 A$
Short-term benefits		19,434,908		15,180,745		2,733,303		2,777,023
Long-term benefits	166,344			262,147		—		—
Post-employment benefits	616,273			657,350		—		—
Termination benefits	3,130,316			—		—		—
Share-based payments	5,167,311			7,681,214		—		—
	28,515,152			23,781,456		2,733,303		2,777,023

The Company has taken advantage of the relief provided by Australian Securities and Investments Commission Class Order 06/50 and has transferred the detailed remuneration disclosures to the Remuneration Report, which is presented in the Directors’ Report.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 25 — Key management personnel disclosures (continued)

(b) Equity instrument disclosures relating to key management personnel

(i) Options provided as remuneration and shares issued on exercise of such options

Details of options provided as remuneration and shares issued on the exercise of such options, together with terms and conditions of the options, can be found in the remuneration report.

(ii) Share holdings

The number of shares in the Company held during the financial year by each Director and other key management personnel, including their personally related parties, are set out below.

2009 Name	Balance at 1 July 2008	Received on exercise of options or rights	Purchases /(Sold)	Other changes during the year	Balance at 30 June 2009
Non-Executive Directors:
N Bobins (ADS)	54,600	—	—	—	54,600
M Feeney	25,734	—	940	—	26,674
P Mazoudier	14,639	—	562	—	15,201
G Morris (ADS)	20,000	—	—	—	20,000
C Renwick	1,444	—	1,700	—	3,144
P Varello (ADS)	6,225	—	24,600	—	30,825
Executive Directors:
D Dienst (ADS)	1,156,872	—	—	—	1,156,872
R Cunningham1	—	32,433	(14,989)	(17,444)	—
J Sutcliffe2	52,255	82,577	(102,255 )	—	32,577
Senior Executives:
T Bird3	—	6,732	(6,732 )	—	—
G Davy	3,003	12,903	(12,903)	—	3,003
R Kelman (ADS)4	—	14,931	(14,931 )	30,048	30,048
R Larry (ADS)	90,972	—	—	—	90,972
D McGree	—	11,924	—	—	11,924
A Ratner (ADS)4	74,316	—	(3,115)	30,048	101,249
Total	1,500,060	161,500	(127,123 )	42,652	1,577,089

1 Mr Cunningham retired from the Board on 21 November 2008. Other changes for Mr Cunningham represent his share holdings on the date of his retirement.

2

2 Mr Sutcliffe’s service agreement was terminated by way of redundancy on 26 August 2009. 3

The Company accepted Mr Bird’s resignation on 17 August 2009.

4

Other changes for Messrs Kelman and Ratner represent shares they each received as part of an integration bonus.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 25 — Key management personnel disclosures (continued)

(b) Equity instrument disclosures relating to key management personnel (continued)

(ii) Share holdings (continued)

2008 Name		Balance at 1 July 2007		Received on exercise of options or rights		Purchases /(Sold)		Other changes during the year		Balance at 30 June 2008
Non-Executive Directors:
N Bobins (ADS)		—		123,000		(68,400)		—		54,600
G Brunsdon2		3,497		—		—		(3,497 )		—
J DiLacqua1(ADS)		—		61,500		(61,500)		—		—
B Every2		4,000		—		—		(4,000 )		—
M Feeney		25,504		—		230		—		25,734
P Mazoudier		14,082		—		557		—		14,639
G Morris (ADS)		—		30,750		(10,750)		—		20,000
C Renwick		—		—		1,444		—		1,444
P Varello (ADS)		4,600		—		1,625		—		6,225
Executive Directors:
D Dienst3(ADS)		—		—		—		1,156,872		1,156,872
R Cunningham1		—		25,408		(25,408 )		—		—
J Sutcliffe4		15,517		60,721		(23,983)		—		52,255
Senior Executives:
T Bird5		—		2,788		(2,788)		—		—
G Davy		—		3,003		—		—		3,003
R Kelman (ADS)		—		29,863		(29,863)		—		—
R Larry3(ADS)		—		—		—		90,972		90,972
D McGree		—		8,185		(8,185)		—		—
A Ratner (ADS)3		—		—		—		74,316		74,316
Total		67,200		345,218		(227,021)		1,314,663		1,500,060

1 Messrs Cunningham and DiLacqua retired from the Board on 21 November 2008.

2

2 Messrs Brunsdon and Every retired from the Board on 21 November 2007.

3 Other changes for Messrs Dienst, Larry and Ratner represent their respective shareholdings after the merger with Metal Management Inc. Amount for Mr Ratner also includes 25,625 restricted share awards which will vest over 3 years subject to employment conditions.

4 Mr Sutcliffe’s service agreement was terminated by way of redundancy on 26 August 2009.

5 The Company accepted Mr Bird’s resignation on 17 August 2009.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 25 — Key management personnel disclosures (continued)

(b) Equity instrument disclosures relating to key management personnel (continued)

(iii) Option holdings

The numbers of options over ordinary shares or ADS in the Company held during the financial year by each Director and other key management personnel, including their personally related parties, are set out below.

2009 Name		Balance at 1 July 2008			Granted as compen- sation	Granted as compen- sation		Exercised	Other changes	Other changes		Balance at 30 June 2009	Balance at 30 June 2009	Balance at 30 June 2009		Vested	Vested	Vested		Unvested	Unvested
Non-Executive Directors:
R Lewon (ADS)		123,000			—			—		—		123,000				123,000				—
G Morris (ADS)		205,000			—			—		—		205,000				205,000				—
Executive Directors:
D Dienst (ADS)		410,000			181,654			—		—		591,654				410,000				181,654
J Sutcliffe3		—			135,435			—		—		135,435				—				135,435
Senior Executives:
T Bird4		—			39,347			—		—		39,347				—				39,347
G Davy		—			48,950			—		—		48,950				—				48,950
R Kelman (ADS)		—			87,664			—		—		87,664				—				87,664
R Larry (ADS)		—			109,580			—		—		109,580				—				109,580
D McGree		—			47,534			—		—		47,534				—				47,534
A Ratner (ADS)		—			87,664			—		—		87,664				—				87,664
Total 2008 Name		738,000 Balance at 1 July 2007		737,828 Granted as compen- sation			— Exercised			— Other changes1		1,475,828 Balance at 30 June 2008				738,000 Vested				737,828 Unvested
Non-Executive Directors:
N Bobins (ADS)		—		—			(123,000)			123,000				—				—			—
J DiLacqua2(ADS)		—		—			(61,500 )			61,500				—				—			—
R Lewon (ADS)		—		—			—			123,000				123,000				123,000			—
G Morris (ADS)		—		—			(30,750 )			235,750				205,000				205,000
Executive Directors:
D Dienst (ADS)		—		—			—			410,000				410,000				410,000			—
R Cunningham2		10,417		—			(10,417)			—				—				—			—
J Sutcliffe3		36,738		—			(36,738 )			—				—				—			—
D McGree		8,185		—			(8,185)			—				—				—			—
Total		55,340		—			(270,590 )			953,250				738,000				738,000			—

1 Options were assumed as a result of the Metal Management Inc merger.

2

2 Mr Cunningham and Mr DiLacqua retired from the Board on 21 November 2008. 3

3 Mr Sutcliffe’s service agreement was terminated by way of redundancy on 26 August 2009. 4

The Company accepted Mr Bird’s resignation on 17 August 2009.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 25 — Key management personnel disclosures (continued)

(b) Equity instrument disclosures relating to key management personnel (continued)

(iv) Rights and award holdings

The numbers of rights to ordinary shares or ADS in the Company held during the financial year by each Director and other key management personnel, including their personally related parties, are set out below.

Name		Balance at 1 July 2007		Granted as compen- sation		Vested		Balance at 30 June 2008		Granted as compen- sation		Vested		Balance at 30 June 2009
Executive Directors:
D Dienst (ADS)		—		—		—		—		61,092		—		61,092
R Cunningham1		29,978		66,847		(14,989 )		81,836		—		(32,433 )		49,403
J Sutcliffe2		95,930		224,534		(23,983)		296,481		44,440		(82,577)		258,344
Senior Executives:
T Bird3		2,788		54,785		(2,788)		54,785		14,720		(6,732)		62,773
G Davy		3,003		94,246		(3,003 )		94,246		18,312		(12,903 )		99,655
R Kelman (ADS)		59,725		24,644		(29,863)		54,506		38,580		(14,931)		78,155
R Larry (ADS)		—		—		—		—		48,225		—		48,225
D McGree		—		66,737		—		66,737		16,313		(11,924)		71,126
A Ratner (ADS)		—		25,625		—		25,625		38,580		(8,541 )		55,664
Total		191,424		557,418		(74,626)		674,216		280,262		(170,041)		784,437

• 1 Mr. Cunningham retired from the Board on 21 November 2008. Balance as at 30 June 2009 represents awards that will vest in future periods based on satisfaction of performance criteria as a result of “good-leaver” provisions in his share-based awards.

• 2

• 3

Mr Sutcliffe’s service agreement was terminated by way of redundancy on 26 August 2009.

• The Company accepted Mr Bird’s resignation on 17 August 2009.

(c) Other transactions with key management personnel

Transactions entered into with any Directors or other key management personnel of the Company, including their personally related parties, are at normal commercial terms. During the year ended 30 June 2009, a company related to Paul Varello was paid US$9,145 for safety consulting services (2008: US$6,000).

Note 26 — Remuneration of auditors

It is the Group’s policy to employ PricewaterhouseCoopers on assignments additional to their statutory audit duties where PricewaterhouseCoopers’ expertise and experience with the Group are important. These assignments are principally for tax advice and due diligence on acquisitions, or where PricewaterhouseCoopers are awarded assignments on a competitive basis. All audit and non-audit services provided by PricewaterhouseCoopers are subject to pre-approval by the Group’s Risk, Audit and Compliance Committee in accordance with the Group Independence Policy.

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Notes to the Financial Statements

For the year ended 30 June 2009

Note 26 — Remuneration of auditors (continued)

During the year, the following fees were paid and payable for services provided by the auditor of the Parent, its related practices and nonrelated audit firms:

		Consolidated	Consolidated	2008 A$’000	Parent	Parent
		2009 A$’000			2009 A$’000	2008 A$’000
PricewaterhouseCoopers — Australian Firm:
Audit of financial reports		4,066		2,166	—	—
Sarbanes-Oxley readiness advice		1,705		—	—	—
Taxation services		213		427	—	—
Acquisition due diligence and other		110		1,132	—	—
		6,094		3,725	—	—
Related practices of PricewaterhouseCoopers — Australian Firm:
Audit of financial reports		4,319		2,194	—	—
Sarbanes-Oxley readiness advice		506		—	—	—
Taxation services		710		138	—	—
Acquisition due diligence and other		31		79	—	—
		5,566		2,411	—	—
Total remuneration for PricewaterhouseCoopers		11,660		6,136	—	—

Note 27 — Business combinations and disposals

• (a) Summary of acquisitions

During the year ended 30 June 2009, the Group acquired the following businesses:

• On 29 July 2008, the purchase of the assets and business of C Herring & Son Ltd. The business is a small established ferrous and nonferrous metal recycler and is based in Hartlepool, United Kingdom.

• On 15 September 2008, the purchase of the assets and business of Weinert Recycling Co Inc. The business is a regional ferrous and nonferrous metal recycler and operates in two locations in Middletown and Ferndale, New York.

• On 3 October 2008, the purchase of the issued capital of Global Investment Recovery Inc. The business is a multi-state electronic recycling and asset recovery service provider in the United States, with operating facilities in Florida, South Carolina, Nevada, Louisiana and Arizona.

• On 17 February 2009, the purchase of the assets and business of All Metal Recovery Limited. The business is a small ferrous and nonferrous metal recycler and is based in Birmingham, United Kingdom.

• On 27 May 2009, the purchase of the assets and business of Global Environment Recycling Co. Limited. The business is an electronic recycler located in Liverpool, United Kingdom.

Aggregate revenue and aggregate net profit contribution by the above acquisitions to the Group post acquisition was not significant.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 27 — Business combinations and disposals (continued)

(b) Purchase consideration and assets and liabilities acquired

Details of the aggregate purchase consideration and the fair value of assets and liabilities acquired during the year ended 30 June 2009 are presented below.

		A$’000
Purchase consideration:
Cash		75,878
Direct costs relating to acquisitions		1,795
Total purchase consideration		77,673

	Acquiree’s carrying amount A$’000	Acquiree’s carrying amount A$’000		Fair value A$’000
Cash		1,659		1,659
Trade and other receivables		18,631		18,631
Prepayments		1,630		1,630
Inventories		2,918		2,918
Property, plant and equipment (Note 12)		20,998		27,108
Identified intangibles (Note 14)		—		7,752
Trade and other creditors		(24,490 )		(24,490 )
Deferred tax liability		(714)		(942)
Current tax liabilities		(193 )		(193 )
Net assets		20,439		34,073
Negative goodwill recognised (Note 5)				(399 )
Goodwill on acquisition (Note 13)				43,999
Total purchase consideration				77,673
Cash acquired				(1,659)
Net cash outflow				76,014

The initial accounting for the acquisitions has only been provisionally determined for those acquisitions completed in the last twelve months. The goodwill is attributable to several factors including, site locations, synergies existing in the operations acquired and the assembled workforce which together contribute to the profitability of the acquired businesses. Negative goodwill relating to an acquisition in the United Kingdom was recognised in the income statement under the heading other income.

(c) Prior year acquisition

Acquisition of Metal Management Inc

On 14 March 2008, the Company purchased the issued capital of Metal Management Inc for A$1.5 billion. The consideration comprised 53,473,817 ordinary shares (in the form of American Depositary Shares) with a fair value of A$1.5 billion, the assumption of outstanding share options with a fair value of A$10.5 million and transaction costs of A$19.5 million. Metal Management Inc was one of the largest full service scrap metal recyclers in the United States with 50 locations in 17 states. The acquisition was consummated to expand the Group’s presence in the North American scrap recycling market. The acquisition was complementary as Sims’ operations in North America were primarily exportfocused while those of Metal Management Inc were primarily domestic-focused and included a large non-ferrous recycling business. Additionally, both companies had significantly overlapping businesses in the United States.

If the acquisition of Metal Management Inc occurred on 1 July 2007, revenues and net profit of the Company would have been A$10.2 billion and A$493.0 million, respectively, for the year ended 30 June 2008. These amounts have been calculated using the Company’s accounting policies and by adjusting the results of Metal Management Inc to reflect additional depreciation and amortisation expense that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets had applied from 1 July 2007, together with the consequential tax effects.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 27 — Business combinations and disposals (continued)

(d) Disposals

On 30 June 2009, the Company sold the issued capital of Tyrecycle Pty Limited and a related parcel of land for A$8.5 million in cash. The sale was part of the Company’s announced strategy of disposing of its non-core businesses. There was a loss on the disposal of A$2.6 million as set out in Note 6. The sale agreement includes a net asset adjustment which amounted to A$0.7 million and is included in “other payables” on the balance sheet.

Note 28 — Subsidiaries

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in Note 1.

Name of entity	Country of Incorporation	Equity holding	Equity holding
		2009 %	2008 %
Sims Metal Management Limited
Sims Group Australia Holdings Limited (i)	Australia	100%	100%
PNG Recycling Limited	PNG	100 %	100 %
Sims Aluminium Pty Limited (i)	Australia	100%	100%
Sims E-Recycling Pty Limited	Australia	90 %	90 %
Sims E-Recycling (NZ) Limited	New Zealand	100%	—
Sims Group Canada Holdings Limited	Canada	100 %	100 %
Sims Group Mauritius Limited	Mauritius	100%	100%
Trishyiraya Recycling India Private Ltd	India	100 %	100 %
Sims Tyrecycle Properties Pty Ltd	Australia	100%	100%
Sims Tyrecycle Pty Ltd (iii)	Australia	—	100 %
Simsmetal Holdings Pty Limited	Australia	100%	100%
Sims Metal Management Asia Limited (formerly Sims Asia Holdings Limited)	Hong Kong	100 %	100 %
Sims Energy Pty Limited	Australia	100%	100%
Sims Industrial Pty Limited	Australia	100 %	100 %
Simsmetal Industries Limited	New Zealand	100%	100%
Simsmetal Services Pty Limited (i)	Australia	100 %	100 %
Sims Manufacturing Pty Limited	Australia	100%	100%
Simsmetal Executive Staff Superannuation Pty Limited	Australia	100 %	100 %
Sims Superannuation Management Pty Limited	Australia	100%	100%
Universal Inspection and Testing Company Pty Limited	Australia	100 %	100 %
Sims Recycling Solutions Pte Limited	Singapore	100%	100%
Simsmetal Staff Equity Pty Limited	Australia	100 %	100 %
Sims Group UK Holdings Limited	UK	100%	100%
Sims Group UK Intermediate Holdings Limited	UK	100 %	100 %
Sims Group UK Limited	UK	100%	100%
C Herring & Son Limited (ii)	UK	100 %	—
Life Cycle Services Limited (ii)	UK	100%	—
All Metal Recovery Limited (ii)	UK	100 %	—
All Metal Recovery Cradley Heath Limited (ii)	UK	100%	—
ER Coley (Steel) Limited	UK	100 %	100 %
ER Coley (Cast) Limited	UK	100%	100%
Evans & Mondon Limited	UK	100 %	100 %
Mirec BV	The Netherlands	100%	100%
Sims Recycling Solutions NV	Belgium	100 %	100 %
Recommit Limited	UK	100%	100%
Sims Cymru Limited	UK	100 %	100 %
Sims Group German Holdings GmbH	Germany	100%	100%

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Notes to the Financial Statements For the year ended 30 June 2009

Note 28 — Subsidiaries (continued)

Name of entity	Country of Incorporation	Equity holding	Equity holding
		2009 %	2008 %
Sims M+R GmbH	Germany	100 %	100 %
Sims Recycling Solutions AB (formerly Mirec AB)	Sweden	100%	100%
Sims Group Recycling Solutions Canada Ltd	Canada	100 %	100 %
Accu-Shred Limited	Canada	100%	100%
Sims Recycling Solutions SARL (ii)	France	100 %	—
Sims Recycling Solutions Inc (formerly United Refining and Smelting)	USA	100%	100%
Sims Recycling Solutions Holdings Inc (formerly Sims Recycling Solutions Inc)	USA	100 %	100 %
Global Investment Recovery Inc (ii)	USA	100%	—
Sims Recycling Solutions UK Holdings Limited	UK	100 %	100 %
Sims Recycling Solutions UK Group Limited	Scotland	100%	100%
Sims Recycling Solutions UK Limited	Scotland	100 %	100 %
United Castings Limited	UK	100%	100%
Sims Group UK Pension Trustees Limited	UK	100 %	100 %
Sims Group Holdings 1 Pty Ltd	Australia	100%	100%
Sims Group Holdings 2 Pty Ltd	Australia	100 %	100 %
Sims Metal Management USA GP	USA	100%	100%
Sims Group USA Holdings Corporation	USA	100 %	100 %
SHN Co LLC	USA	100%	100%
HNW Recycling LLC	USA	100 %	100 %
HNE Recycling LLC	USA	100%	100%
Dover Barge Company	USA	100 %	100 %
North Carolina Resource Conservation LLC	USA	100%	100%
Simsmetal East LLC	USA	100 %	100 %
Sims Municipal Recycling of New York LLC	USA	100%	100%
Schiabo Larovo Corporation	USA	100 %	100 %
Simsmetal West LLC	USA	100%	100%
Sims Group Global Trade Corporation	USA	100 %	100 %
Sims Group USA Corporation	USA	100%	100%
Metal Management Inc	USA	100 %	100 %
MM Metal Dynamics Holdings Inc	USA	100%	100%
Metal Dynamics LLC	USA	100 %	100 %
Metal Dynamics Detroit LLC	USA	100%	100%
Metal Dynamics Indianapolis LLC	USA	100 %	100 %
Metal Management Midwest Inc	USA	100%	100%
CIM Trucking Inc	USA	100 %	100 %
Metal Management Indiana Inc	USA	100%	100%
Metal Management Memphis LLC	USA	100 %	100 %
Metal Management Ohio Inc	USA	100%	100%
SMM — North America Trade Corporation (formerly Metal Management S&A Holdings Inc)	USA	100 %	100 %
Metal Management Pittsburgh Inc	USA	100%	100%
Metal Management Aerospace Inc	USA	100 %	100 %
Metal Management West Coast Holdings Inc	USA	100%	100%
Metal Management West Inc	USA	100 %	100 %
Metal Management Arizona LLC	USA	100%	100%
Proler Southwest GP Inc	USA	100 %	100 %
Metal Management Proler Southwest Inc	USA	100%	100%
Proler Southwest LP	USA	100 %	100 %
Metal Management Alabama Inc	USA	100%	100%
Metal Management Mississippi Inc	USA	100 %	100 %

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Notes to the Financial Statements For the year ended 30 June 2009

Note 28 — Subsidiaries (continued)

Name of entity	Country of Incorporation	Equity holding	Equity holding
		2009 %	2008 %
Naporano Iron & Metal Inc	USA	100 %	100 %
Metal Management Northeast Inc	USA	100%	100%
Metal Management Connecticut Inc	USA	100 %	100 %
New York Recycling Ventures Inc	USA	100%	100%
Metal Management New Haven Inc	USA	100 %	100 %
Reserve Iron & Metal Limited Partnership	USA	100%	100%

(i) These subsidiaries and the Parent are parties to a Deed of Cross Guarantee under which each entity guarantees the debts of the others. The above entities represent a Closed Group and an Extended Closed Group for the purposes of the relevant Australian Securities & Investments Commission Class Order.

• (ii) These subsidiaries were acquired or incorporated during the year.

• (iii) These subsidiaries were sold, de-registered or liquidated during the year.

The voting power held in each subsidiary is proportionate to the equity holdings.

Deed of Cross Guarantee

Sims Metal Management Limited, Sims Group Australia Holdings Limited, Sims Aluminium Pty Limited and Simsmetal Services Pty Limited are parties to a deed of cross guarantee under which each Group guarantees the debts of the others. Sims Tyrecycle Pty Limited was a party to the deed until its sale on 30 June 2009. By entering into the deed, the wholly-owned entities have been relieved from the requirements to prepare a financial report and directors’ report under Class Order 98/1418 (as amended) issued by the Australian Securities & Investments Commission.

The above companies represent a “Closed Group” for the purposes of the Class Order. As there are no other parties to the Deed of Cross Guarantee that are controlled by Sims Metal Management Limited, they also represent the “Extended Closed Group”.

Set out below is a condensed consolidated income statement, a summary of movements in consolidated retained profits and a consolidated balance sheet for the Closed Group.

		2009 A$’000		2008 A$’000		2007 A$’000
(i) Consolidated income statement
Profit before income tax		244,295		253,376		202,236
Income tax expense		(1,423 )		(51,374 )		(40,778 )
Profit after tax		242,872		202,002		161,458
(ii) Summary of movements in consolidated retained profits
Balance at 1 July		113,634		84,709		71,607
Effect of accounting policy change (Note 1(b)(vi))		—		6,465		—
Profit for the year		242,872		202,002		161,458
Actuarial (loss)/gain on defined benefit plan, net of tax		2,859		(4,830 )		1,666
Dividends provided for or paid		(186,493)		(174,712)		(150,022)
Balance at 30 June		172,872		113,634		84,709

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Notes to the Financial Statements For the year ended 30 June 2009

Note 28 — Subsidiaries (continued)

Deed of Cross Guarantee (continued)

		2009 A$’000		2008 A$’000
(iii) Consolidated balance sheet
ASSETS
Current assets
Cash and cash equivalents		19,317		1,546
Trade and other receivables		274,935		332,179
Current tax receivable		16,624		—
Inventory		82,274		112,012
Derivative financial instruments		—		47
Other financial assets		3,092		3,803
Total current assets		396,242		449,587
Non-current assets
Receivables		2,346		150
Investments accounted for using the equity method		18,522		13,636
Other financial assets		2,303,038		2,302,999
Property, plant and equipment		101,471		102,781
Deferred tax assets		15,411		16,677
Intangible assets		15,832		18,546
Total non-current assets		2,456,620		2,454,789
Total assets		2,852,862		2,904,376
LIABILITIES
Current liabilities
Trade and other payables		266,494		304,376
Derivative financial instruments		775		1,897
Current tax liabilities		—		33,942
Provisions		12,190		16,098
Total current liabilities		279,459		356,313
Non-current liabilities
Borrowings		—		60,138
Deferred tax liabilities		4,439		6,511
Provisions		8,790		9,045
Retirement benefit obligations		6,070		3,317
Total non-current liabilities		19,299		79,011
Total liabilities		298,758		435,324
Net assets		2,554,104		2,469,052
EQUITY
Contributed equity		2,352,928		2,325,924
Reserves		28,304		29,494
Retained profits		172,872		113,634
Total equity		2,554,104		2,469,052

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Notes to the Financial Statements For the year ended 30 June 2009

Note 29 — Investments in associates and jointly controlled entities

(a) Carrying amounts of associates and jointly controlled entities

Name of associates or jointly controlled entities	Principal activity	Country of incorpor- ation	Ownership interest 2009 2008	Ownership interest 2009 2008			Consolidated carrying amount	Consolidated carrying amount	Consolidated carrying amount	Consolidated carrying amount
			2009				2009 A$’000			2008 A$’000
SA Recycling LLC	Metal Recycling	USA	50 %	50 %			329,895			271,330
Metal Management Nashville LLC	Metal Recycling	USA	50%	50%			22,301			20,368
Rondout Iron & Metal LLC	Metal Recycling	USA	50 %	50 %			643			1,082
Port Albany Ventures LLC	Stevedoring and Marine Services	USA	50%	50%			6,647			5,791
Richmond Steel Recycling Limited	Metal Recycling	Canada	50 %	50 %			21,648			19,485
LMS Generation Pty Ltd	Landfill gas management	Australia	50%	50%			18,509			13,611
Australia Refined Alloys Pty Limited	Metal Recycling	Australia	50 %	50 %			13			13
Extruded Metals Limited	Metal Recycling	New Zealand	33%	33%			588			546
							400,244			332,226
								Consolidated
								2009 A$’000		2008 A$’000
(b) Movements in carrying amounts:
Balance at 1 July								332,226		25,945
Additions from acquisition of businesses during the year								—		27,440
Additions from formation of SA Recycling								—		342,336
Share of profits before tax								57,638		62,334
Associates share of income tax expense								(2,580)		(4,161)
Accretion of deferred gain to equity accounted profits								3,170		2,239
Deferral of gain on formation of SA Recycling LLC								—		(38,840)
Dividends received								(41,458 )		(5,153 )
Return of capital from SA Recycling LLC								(3,343)		(46,083)
Return of capital from other jointly controlled entities								(241 )		(2,413 )
Other								1,726		—
Foreign exchange differences								53,106		(31,418 )
Balance at 30 June								400,244		332,226
(c) Share of associates and jointly controlled entities profits:
Profit before income tax								60,808		64,573
Associates share of income tax expense								(2,580 )		(4,161 )
Profit after income tax recognised in equity accounted investment								58,228		60,412
Jointly controlled entities income tax expense*								(19,184 )		(19,331 )
Associates and jointly controlled entities profit after tax								39,044		41,081

• The jointly controlled entities to which this relates are “pass through” entities for taxation purposes. As such, the Group incurs the income tax expense and associated tax liability on its share of the profits and includes this amount as part of its income tax expense (see Note 7).

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Notes to the Financial Statements For the year ended 30 June 2009

Note 29 — Investments in associates and jointly controlled entities (continued)

(d) SA Recycling LLC

On 1 September 2007, the Group completed the merger of its Southern Californian metal recycling assets with those of Adams Steel LLC. The newly created jointly controlled entity, SA Recycling LLC, operates within a territory encompassing Southern California, Arizona, Southern Nevada and Northern Mexico and combines Sims’ deep water facility at the Port of Los Angeles with Adams Steel’s two inland shredding operations and extensive network of inland feeder yards.

In accordance with AASB 128, “Investments in Associates” and AASB 131, “Interests in Joint Ventures” the SA Recycling LLC is a jointly controlled entity accounted for under the equity method. The fair values of assets and liabilities contributed to SA Recycling LLC at 1 September 2007 were as follows:

	Book value A$’000	Book value A$’000		Fair value A$’000		Non-cash gain A$’000
Property, plant and equipment		71,436		79,872		(8,436 )
Goodwill and intangible assets		196,425		265,670		(69,245)
Non-current provisions		(3,206 )		(3,206 )		—
		264,655		342,336		(77,681)

In accordance with Urgent Issues Group (“UIG”) 113, “Jointly Controlled Entities — Non-Monetary Contributions by Venturers”, the portion of the non-cash gain attributable to the equity interest of the other venturer, in this instance 50%, was recognised immediately on contribution of assets to the SA Recycling LLC jointly controlled entity. This has been recognised as other income, see Note 5. The remaining 50% of the non-cash gain for goodwill and intangibles has been allocated to reduce the cost of the equity accounted investment and will be recognised progressively over the remaining useful life of the assets to which it relates. The remaining 50% of the non-cash gain for property, plant and equipment has been allocated to reduce the cost of the equity accounted investment and will be recognised if the land to which the gain relates is sold.

(e) Summarised financial information of associates and jointly controlled entities

		Consolidated	Consolidated	Consolidated
		2009 A$’000		2008 A$’000
Group’s share of assets and liabilities
Current assets		92,132		190,129
Non-current assets		313,421		370,966
Total assets		405,553		561,095
Current liabilities		34,152		203,493
Non-current liabilities		102,213		12,628
Total liabilities		136,365		216,121
Net assets		269,188		344,974

			Consolidated	Consolidated
		2009 A$’000		2008 A$’000		2007 A$’000
Group’s share of revenue, expenses and results
Revenues		814,216		699,865		101,224
Expenses		(756,578 )		(637,531 )		(94,194 )
Profit before income tax		57,638		62,334		7,030

(f) Contingent liabilities and capital commitments

The Group’s share of the contingent liabilities of associates and jointly controlled entities is disclosed in Note 22. The Group’s share of the capital commitments and other expenditure commitments of associates and jointly controlled entities is disclosed in Note 23.

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Notes to the Financial Statements

For the year ended 30 June 2009

Note 29 — Investments in associates and jointly controlled entities (continued)

(g) Jointly controlled operations

The Group has a 50% interest in Sims Pacific Metals Joint Venture which is accounted for under the proportionate consolidation method. Sims Pacific Metals Joint Venture is an unincorporated joint venture based in New Zealand and its principal activity is metal recycling.

The Group’s interest in the jointly controlled operation is included in the balance sheet under the classifications shown below:

		Consolidated	Consolidated	Consolidated
		2009 A$’000		2008 A$’000
Current assets		10,186		25,146
Non-current assets		7,578		11,884
Total assets		17,764		37,030
Current liabilities		10,121		21,681
Non-current liabilities		3,248		241
Total liabilities		13,369		21,922
Net assets		4,395		15,108

The Group’s share of the jointly controlled operation’s contingent liabilities and capital expenditure commitments is included in Notes 22 and 23.

Note 30 — Related party transactions

(a) Parent

The Parent of the consolidated group is Sims Metal Management Limited.

(b) Subsidiaries

Interests held in subsidiaries are set out in Note 28.

(c) Key management personnel

Disclosures relating to key management personnel are set out in Note 25.

(d) Outstanding balances arising from transactions with related entities

The following balances are outstanding at the reporting date in relation to transactions with related parties:

Tax funding agreement receivable (payable) Subsidiaries	Consolidated 2009 2008 A$’000 A$’000 — —	Parent
	2009 A$’000 —	2009 A$’000 (14,123)	2008 A$’000
			41,147

No provision for doubtful debts has been raised in relation to any outstanding balances, and no expense has been recognised in respect of bad or doubtful debts due from related parties.

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Notes to the Financial Statements For the year ended 30 June 2009

Note 30 — Related party transactions (continued)

(e) Transactions with related parties

The following transactions occurred with related parties:

	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
	2009 A$’000		2009 A$’000	2008 A$’000
Tax consolidation legislation
Current tax receivable (payable) assumed from wholly-owned tax consolidation entities	—	—	14,123	(41,147)
Dividend revenue
Received from subsidiaries	—	—	231,001	170,205
Management fee
Received from subsidiaries	—	—	1,556	1,473
Operating expenses
Paid by subsidiaries	—	—	2,733	2,777
Superannuation contributions
Contributions to superannuation funds on behalf of employees	7,653	8,386	—	—

(f) Transactions with associates and jointly controlled entities

	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000	Parent	Parent
	2009 A$’000		2009 A$’000	2008 A$’000
Sales	70,654	8,341	—	—
Purchases	1,139,622	689,634	—	—
Management fees and commissions	11,477	10,011	—	—
Other costs	353	276	—	—

(g) Outstanding balances arising from transactions with associates and jointly controlled entities

Current receivables Current payables	Consolidated 2009 2008 A$’000 A$’000 16,313 4,603 18,790 169,074	Parent	Parent
		2009 A$’000 — —	2008 A$’000
			— —

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 30 — Related party transactions (continued)

(h) Loans from related parties

	Consolidated 2009 2008 A$’000 A$’000	Consolidated 2009 2008 A$’000 A$’000		Parent	Parent
	2009 A$’000			2009 A$’000		2008 A$’000
Loans from related parties balance at 1 July	—	—		343,411		362,638
Net reduction in loan *	—	—		(58,835)		(19,227)
Loans from related parties balance at 30 June	—	—		284,576		343,411

• Other than for cash transactions to fund and pay dividends, all other cash receipts and payments of the Parent are conducted through a subsidiary. The net reduction reflects the aggregate impact of these transactions during the year.

No provision for doubtful debts has been raised in relation to any outstanding balances, and no expense has been recognised in respect of bad or doubtful debts due from related parties.

(i) Terms and conditions

The terms and conditions of the tax funding agreement are set out in Note 7. Loans from subsidiaries are at call and bear no interest. All other transactions were made on normal commercial terms and conditions and at market rate.

Note 31 — Segment reporting

(a) Operating segments

The Group is principally organised geographically and then by line of business. While the Chief Executive Officer evaluates results in a number of different ways, the geographical areas of operation is the primary basis for which the allocation of resources and financial results are assessed. The major geographic areas of operations are as follows:

• North America — comprising the United States of America and Canada.

• Australasia — comprising Australia, New Zealand, Papua New Guinea and Asia.

• Europe — comprising United Kingdom, Sweden, Holland and Germany.

The Group also reports revenues by the following product groups:

• Ferrous secondary recycling — comprising the collection, processing and trading of iron and steel secondary raw material.

• Non-ferrous secondary recycling — comprising the collection, processing and trading of other metal alloys and residues, principally aluminum, lead, copper, zinc and nickel bearing materials.

• Secondary processing — comprising value added process involving the melting, refining and ingoting of certain non-ferrous metals and the reclamation and reprocessing of plastics.

• Recycling solutions — comprising the provision of environmentally responsible solutions for the disposal of post consumer electronic products, including IT assets recycled for commercial customers. The Company offers fee for service business opportunities in the environmentally responsible recycling of negative value materials including refrigerators, electrical and electronic equipment.

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 31 — Segment reporting (continued)

(b) Segment information

		North America A$’000		Australasia A$’000		Europe A$’000	Consolidated A$’000	Consolidated A$’000
2009
Total sales revenue		6,368,489		1,158,619		1,109,117		8,636,225
Other revenue/income		2,750		1,536		499		4,785
Total segment revenue		6,371,239		1,160,155		1,109,616		8,641,010
Segment EBITDA		224,416		40,943		(6,371 )		258,988
Depreciation and amortisation		122,754		21,360		26,706		170,820
Goodwill impairment charge		190,207		887		—		191,094
Segment EBIT		(88,545)		18,696		(33,077)		(102,926)
Interest income								2,272
Finance costs								(21,508)
Loss before income tax								(122,162 )
Segment total assets		2,769,992		485,495		553,073		3,808,560
Segment total liabilities		465,926		175,429		308,158		949,513
Net assets		2,304,066		310,066		244,915		2,859,047
Other segment information:
Share of pre-tax profit of investments accounted for using the equity method		55,255		5,553		—		60,808
Investments in associates and jointly controlled entities		381,134		19,110		—		400,244
Acquisitions of property, plant and equipment		106,416		39,751		41,307		187,474
2008
Total sales revenue		4,607,898		1,745,109		1,312,584		7,665,591
Other revenue/income		2,293		1,182		1,470		4,945
Total segment revenue		4,610,191		1,746,291		1,314,054		7,670,536
Segment EBITDA		471,409		202,314		116,813		790,536
Depreciation and amortisation		55,683		16,601		22,802		95,086
Goodwill impairment charge		—		3,349		—		3,349
Segment EBIT		415,726		182,364		94,011		692,101
Interest income								2,876
Finance costs								(34,374)
Profit before income tax								660,603

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 31 — Segment reporting (continued)

(b) Segment information (continued)

		North America A$’000		Australasia A$’000		Europe A$’000	Consolidated A$’000	Consolidated A$’000
2008 (continued)
Segment total assets		3,372,061		597,168		677,247		4,646,476
Segment total liabilities		767,379		526,897		518,276		1,812,552
Net assets		2,604,682		70,271		158,971		2,833,924
Other segment information:
Share of pre-tax profit of investments accounted for using the equity method		60,271		4,302		—		64,573
Investments in associates and jointly controlled entities		318,056		14,170		—		332,226
Acquisitions of property, plant and equipment		59,987		32,589		37,115		129,691
2007
Total sales revenue		2,938,245		1,465,384		1,144,891		5,548,520
Other revenue/income		512		1,155		710		2,377
Total segment revenue		2,938,757		1,466,539		1,145,601		5,550,897
Segment EBITDA		204,331		167,716		87,336		459,383
Depreciation and amortisation		40,761		13,533		20,159		74,453
Segment EBIT		163,570		154,183		67,177		384,930
Interest income								2,364
Finance costs								(30,405 )
Profit before income tax								356,889
Segment total assets		1,109,507		450,874		496,990		2,057,371
Segment total liabilities		295,879		222,753		366,652		885,284
Net assets		813,628		228,121		130,338		1,172,087
Other segment information:
Share of pre-tax profit of investments accounted for using the equity method		4,446		2,584		—		7,030
Investments in associates and jointly controlled entities		14,029		11,916		—		25,945
Acquisitions of property, plant and equipment		42,684		25,019		22,800		90,503

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 31 — Segment reporting (continued)

(c) Sales to external customers

		2009 A$’000		2008 A$’000		2007 A$’000
Australia		475,814		773,050		576,722
China		1,320,597		600,101		638,674
Malaysia		449,143		663,990		599,228
USA		2,045,890		1,175,386		529,534
Turkey		1,352,907		1,072,729		400,731
South Korea		643,508		412,093		354,939
Other		2,348,366		2,968,242		2,448,692
		8,636,225		7,665,591		5,548,520

(d) Intersegment sales

Segment revenues, expenses and results include transfers between segments. Such transfers are priced on an “arm’s-length” basis and are eliminated on consolidation.

(e) Revenue by product

		2009 A$’000		2008 A$’000		2007 A$’000
Ferrous metal recycling		6,642,694		5,421,102		3,587,925
Non-ferrous metal recycling		1,193,397		1,324,123		1,264,402
Secondary processing		221,624		361,159		262,347
Recycling solutions		578,510		559,207		433,846
		8,636,225		7,665,591		5,548,520

(f) Material non-current assets

Material non-current assets (excluding financial instruments, deferred tax assets and retirement benefit assets) are held in the following countries:

		2009 A$’000		2008 A$’000
Australia		189,141		179,961
USA		2,238,260		2,054,268
United Kingdom		170,637		148,109
Benelux		65,248		42,366
Germany		44,746		50,901
Canada		23,243		21,131
New Zealand		7,805		8,263
Other		11,966		17,038
		2,751,046		2,522,037

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Table of Contents

Notes to the Financial Statements For the year ended 30 June 2009

Note 32 — Earnings per share

The Group calculates both basic and diluted earnings per share. Basic earnings per share is computed using the weighted average number of shares outstanding during the period. Diluted earnings per share is computed using the weighted average number of shares outstanding during the period plus the dilutive effect of share options and rights outstanding during the period.

	2009	2008	2007
(Loss)/profit used in calculating earnings per share (A$’000)	(150,295 )	440,098	239,938
(Loss)/earnings per share (in cents)
Basic	(82.9 )	310.9	192.1
Diluted	(82.9)	307.9	191.0
Weighted average number of shares used in the denominator (‘000)
Number of shares for basic earnings per share	181,247	141,574	124,916
Dilutive effect of share-based awards	—	1,374	704
Number of shares for diluted earnings per share	181,247	142,948	125,620

Due to the loss after tax for the year ended 30 June 2009, the dilutive effect of share-based awards, which was 899,000 shares, was not included as the result would have been anti-dilutive.

Share awards granted to employees are considered to be potential ordinary shares and have been included in the determination of diluted earnings per share to the extent to which they are dilutive. Details relating to share awards are set out in Note 24.

Note 33 — Cash flow information

(a) Reconciliation of cash

Cash at the end of the financial year as shown in the statements of cash flows is reconciled to the related items in the statements of financial position as follows:

	Consolidated	Consolidated	2007 A$’000	Parent	2008 A$’000
	2009 A$’000	2008 A$’000		2009 A$’000
Cash at bank and on hand	59,123	112,944	31,404	198	—
Short term deposits	10,413	20,543	7,156	—	—
Cash and cash equivalents	69,536	133,487	38,560	198	—

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Notes to the Financial Statements For the year ended 30 June 2009

Note 33 — Cash flow information (continued)

(b) Reconciliation of (loss)/profit after income tax expense to net cash inflow

	Consolidated	Consolidated	2007 A$’000	Parent	2008 A$’000
	2009 A$’000	2008 A$’000		2009 A$’000
(Loss)/profit for the year	(150,295 )	440,098	239,938	230,177	169,292
Adjustments for non-cash items:
Depreciation and amortisation	170,820	95,086	74,453	—	—
Net gain on contribution of assets to SA Recycling LLC	—	(38,841)	—	—	—
Unrealised (gain)/loss on held for trading derivatives	10,253	(3,901 )	—	—	—
Impairment of goodwill	191,094	3,349	—	—	—
Impairment of property, plant and equipment	10,021	71	6,784	—	—
Net loss/(profit) on disposal of non-current assets	(864)	1,894	(401)	—	—
Loss on sale of subsidiaries	2,577	—	—	—	—
Share-based payment	9,258	13,388	2,831	—	—
Non-cash pension expense	1,646	479	(110 )	—	—
Non-cash compensation	771	—	—	—	—
Negative goodwill recognised on acquisition	(399 )	—	—	—	—
Equity accounted profits net of dividends received	(16,770)	(55,259)	(4,749)	—	—
Other	419	282	—	—	—
Change in operating assets and liabilities, excluding the effects of acquisitions and disposals of entities:
Decrease/(increase) in trade and other receivables	492,794	(176,650 )	42,275	—	1,490
Decrease/(increase) in inventories	543,440	(407,604)	(16,650)	—	—
Decrease in prepayments	1,720	18,562	3,758	—	—
(Decrease)/increase in provisions	(10,213)	24,220	(16,391)	—	—
(Decrease)/increase in income taxes	(194,811 )	80,298	3,928	(55,232 )	(28 )
Increase/(decrease) in deferred taxes	38,808	(11,195)	(20,889)	—	—
(Decrease)/increase in trade and other payables	(545,818 )	263,254	20,685	(15,258 )	(19,900 )
Net cash inflow from operating activities	554,451	247,531	335,462	159,687	150,854

• (c) Non-cash investing and financing activities

• (i) During the year ended 30 June 2009, dividends of A$26.6 million (2008: A$18.1 million; 2007: A$30.0 million) were paid via the issue of ordinary shares pursuant to the dividend reinvestment plan. Refer to Note 21.

• (ii) On 14 March 2008, the Company acquired 100% of the share capital of Metal Management Inc for A$1,500.6 million. The consideration given comprised of 53,473,817 ordinary shares in Sims Metal Management Limited with a fair value of A$1,490.1 million and A$10.5 million of fully vested share options assumed at fair value. Refer to Note 27.

• (iii) On 1 September 2007, the Group completed the merger of its Southern Californian metal recycling assets with those of Adams Steel LLC amounting to an investment of A$342.3 million. For details of the assets and liabilities contributed to the SA Recycling joint venture, refer to Note 29.

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Notes to the Financial Statements

For the year ended 30 June 2009

Note 34 — Events occurring after the reporting period

On 3 July 2009, the Group acquired the assets of Fairless Iron & Metal, LLC (“Fairless”) based in Morrisville, Pennsylvania on the East Coast of the United States. Fairless, a full-service ferrous and non-ferrous recycler, operates two principal facilities including a state-of-the-art megashredder, non-ferrous recovery systems and a deep water port export facility. The acquisition price of Fairless was not significant to the Group. The assets of Fairless were not combined with those of the Group for the year ended 30 June 2009.

On 17 August 2009, the Company accepted the resignation of Thomas Bird, Managing Director — United Kingdom.

On 26 August 2009, the service agreement for Jeremy Sutcliffe, Executive Director, was terminated by way of redundancy. Refer to the Directors Report for additional information.

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SA Recycling, LLC and Subsidiaries Consolidated Financial Statements June 30, 2009 and 2008

F-78

SA Recycling, LLC and Subsidiaries
Index
June 30, 2009 and 2008
				Page
Report of Independent Registered Public Accounting Firm				F-80
Consolidated Financial Statements
Consolidated Balance Sheets				F-81
Consolidated Statements of Operations				F-82
Consolidated Statements of Changes in Members ’		Equity		F-83
Consolidated Statements of Cash Flows				F-84
Notes to Consolidated Financial Statements				F-85–F-103
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Report of Independent Registered Public Accounting Firm

To the Members of SA Recycling, LLC:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, of changes in members’ equity and of cash flows present fairly, in all material respects, the financial position of SA Recycling, LLC and its subsidiaries at June 30, 2009 and 2008, and the results of their operations and their cash flows for each of the two years in the period ended June 30, 2009 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in Note 16 to the consolidated financial statements, the Company has entered into significant transactions with Global Trade, a related party.

July 31, 2009

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SA Recycling, LLC and Subsidiaries Consolidated Balance Sheets June 30, 2009 and 2008

(in thousands of dollars)	2009	2008
Assets
Current assets
Cash	$ 3,604	$ 4,345
Receivables
Trade, net of allowance for doubtful accounts of $138 and $286 at June 30, 2009 and 2008, respectively	10,131	30,948
Related party	10,207	166,771
Other	292	556
Inventories	48,432	70,506
Restricted cash	10,000	—
Wear parts and spares	11,067	7,853
Other current assets	2,759	2,454
Total current assets	96,492	283,434
Property, plant and equipment, net	205,800	194,257
Intangible assets, net	43,273	23,596
Goodwill	163,252	138,697
Other assets	4,518	4,349
Total assets	$ 513,335	$ 644,333
Liabilities and Members’ Equity
Current liabilities
Cash overdrafts	$ 9,022	$ 31,743
Accounts payable	8,977	29,487
Accrued liabilities	5,850	32,439
Environmental liabilities	1,425	1,425
Related party payables	11,048	3,638
Current portion of long-term debt	271	105,184
Other current liabilities	28	66
Total current liabilities	36,621	203,982
Environmental liabilities, net of current portion	5,847	6,597
Deferred income tax liabilities	1,278	—
Long-term debt	131,357	140,145
Total liabilities	175,103	350,724
Commitments and contingencies (Note 12)
Minority interest	7,197	—
Members’ equity	331,035	293,609
Total liabilities and members’ equity	$ 513,335	$ 644,333

The accompanying notes are an integral part of these consolidated financial statements.

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SA Recycling, LLC and Subsidiaries Consolidated Statements of Operations Years ended June 30, 2009 and 2008

(in thousands of dollars)	2009	2008
Revenue
Gross sales	$983,699	$921,928
Less:
Freight out	(31,572)	(43,184)
Other	(11,642 )	(8,961 )
Total net revenue	940,485	869,783
Cost of sales (excluding depreciation)	742,145	709,702
General and administrative expenses	72,548	47,780
Depreciation and amortization expense	23,433	13,446
Income from operations	102,359	98,855
Other (income) expense, net
Income from equity investment	(237)	(1,187)
Interest expense	7,200	4,843
Other income	(3,022)	(2,636)
Total other expense, net	3,941	1,020
Income before provision for income taxes	98,418	97,835
Provision for income taxes	592	313
Net income before minority interest	97,826	97,522
Loss attributable to minority interest	132	—
Net income	$ 97,958	$ 97,522

The accompanying notes are an integral part of these consolidated financial statements.

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SA Recycling, LLC and Subsidiaries Statements of Changes in Members’ Equity Years ended June 30, 2009 and 2008

(in thousands of dollars)	Adams Steel	Simsmetal West	Total
Balances at June 30, 2007	$ —	$ —	$ —
Members’ contribution	73,762	210,199	283,961
Members’ distribution	(43,937 )	(43,937 )	(87,874 )
Net income	48,761	48,761	97,522
Balances at June 30, 2008	78,586	215,023	293,609
Members’ distribution	(28,210)	(28,210)	(56,420)
Reduction in contributed capital (Note 2)	(338 )	(3,774 )	(4,112 )
Reclassification of contributed capital (Note 2)	(6,897)	6,897	—
Net income	48,979	48,979	97,958
Balances at June 30, 2009	$ 92,120	$238,915	$331,035

The accompanying notes are an integral part of these consolidated financial statements.

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SA Recycling, LLC and Subsidiaries Consolidated Statements of Cash Flows Years ended June 30, 2009 and 2008

(in thousands of dollars)	2009	2008
Cash flows from operating activities
Net income	$ 97,958	$ 97,522
Adjustment to reconcile net income to net cash provided by (used in) operating activities
Depreciation and amortization	23,433	13,446
Non cash inventory write-down	487	—
Equity method investment	(237)	(1,187)
Minority interest	(132 )	—
(Gain) loss on sale of fixed assets	(266)	74
Provision for doubtful accounts	(148 )	286
Deferred income taxes	(192)	—
Changes in operating assets and liabilities, net of effect of acquisitions and contributions from members
Receivables	21,229	(9,470)
Related party receivables	156,564	(166,771 )
Inventories	23,019	(4,580)
Wear parts and spares	(3,214 )	(3,724 )
Other current assets	(411)	(1,618)
Other assets	(310 )	—
Cash overdrafts	(22,721)	24,476
Accounts payable	(20,510 )	15,804
Accrued liabilities	(26,589)	31,259
Environmental liabilities	(1,224 )	—
Related party payables	7,410	3,638
Other current liabilities	(38 )	66
Net cash provided by (used in) operating activities	254,108	(779)
Cash flows from investing activities
Acquisition of businesses, net of cash acquired	(57,952)	(120,466)
Purchase of property and equipment	(18,098 )	(29,135 )
Restricted cash deposits	(10,000)	—
Proceeds from sale of property and equipment	1,322	513
Other	—	155
Net cash used in investing activities	(84,728 )	(148,933 )
Cash flows from financing activities
Proceeds on notes payable	—	5,000
Payments on notes payable	(5,651)	(254)
Proceeds on lines of credit	624,550	429,900
Payments on lines of credit	(632,600)	(291,100)
Proceeds on term loans	—	100,000
Payments on term loans	(100,000)	—
Financing costs	—	(1,615 )
Payment of cash distributions to members	(56,420)	(87,874)
Net cash (used in) provided by financing activities	(170,121 )	154,057
Net (decrease) increase in cash	(741)	4,345
Cash at beginning of period	4,345	—
Cash at end of period	$ 3,604	$ 4,345
Supplemental cash flow information
Cash paid for
Income taxes	$ 1,667	$ 246
Interest	4,924	4,385

The accompanying notes are an integral part of these consolidated financial statements.

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

1. Organization, Business and Basis of Presentation

SA Recycling, LLC, a Delaware limited liability company, (the “Company”), was formed on June 4, 2007 pursuant to a plan to form a joint venture by the combination of operations of Adams Steel, LLC (“Adams Steel”) and Simsmetal West LLC (“Simsmetal West”) (collectively, the “Members”) for the purpose of purchasing, processing and selling ferrous and non-ferrous scrap metals. The Company is a full service scrap metal recycling company with multiple locations located primarily throughout Southern California, which purchase and recycle all types of scrap metal including car bodies, appliances, non ferrous metals, and construction and demolition materials. Other services include mobile car body smashing, demolition contracting, certified destruction services, green waste and oil filter recycling.

The Company formed a joint venture on September 1, 2007, at which time it received contributions of assets and liabilities from Adams Steel and Simsmetal West and began operations.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America.

Principles of Consolidation

The consolidated financial statements include the financial statements of the Company and its majority-owned and wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation. These changes had no significant impact on previously reported balance sheets, statements of operations or statements of cash flows.

Revenue Recognition

The Company’s primary source of revenue is from the sale of processed ferrous and non-ferrous scrap metals. The Company also generates revenues from reselling new steel and performing other recycling services.

The Company recognizes revenue in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 104, Revenue Recognition . Revenues from processed ferrous and non-ferrous scrap metal sales are recognized when title and risk of loss have passed to the customer. Revenues relating to non ferrous export sales are recognized upon receipt of the materials by the customer. Revenues from services are recognized as the service is performed. Sales adjustments related to weight differences are accrued against revenues as incurred.

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Revenues by product category were as follows for the years ended June 30:

	2009	2008
Ferrous metals	$ 793,014	$ 742,214
Non-ferrous metals	181,531	168,386
Other recycling services	9,154	11,328
Gross revenue	$983,699	$921,928

Cash

Cash represents cash in banks and cash on hand. Cash balances at banks are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 per bank. As of June 30, 2009 and 2008, and at various times throughout the years, the Company had deposits in excess of FDIC limits.

Restricted Cash

The revolving line of credit with Fifth Third Bank (Note 9) requires a compensating balance of $10,000, which is legally restricted and recorded separately on the Company’s balance sheet.

Accounts Receivable

Accounts receivable represents amounts due from customers on product and other sales. The carrying amount of accounts receivable approximates fair value. The Company’s determination of the allowance for doubtful accounts receivable includes a number of factors, including the age of the balance, past experience with the customer account, changes in collection patterns and general industry conditions.

Concentrations of Credit Risk and Major Customers

Financial instruments that subject the Company to credit risk consist primarily of accounts receivable. Sales to related party customers and through related party commissioned agents accounted for approximately 84% and 78% of total gross sales for the years ended June 30, 2009 and 2008, respectively. One related party customer accounted for approximately 75% and 69% of total gross sales for the years ended June 30, 2009 and 2008, respectively.

Property, Plant and Equipment

Property, plant and equipment are recorded at cost less accumulated depreciation. Major rebuilds and improvements are capitalized, while repairs and maintenance costs are expensed as incurred. Depreciation is calculated using the straight-line method over the following estimated useful lives:

Buildings	20 to 39 years
Land improvements	5 to 20 years
Leasehold improvements	Lesser of useful life or remaining lease term
Plant and equipment	3 to 15 years

When assets are sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is recorded in the consolidated statement of operations.

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Goodwill and Indefinite-Lived Intangible Assets

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired. In accordance with Statements of Financial Accounting Standards (“SFAS”) No. 142, Goodwill and Other Intangible Assets , goodwill and other intangible assets that are not subject to amortization are tested for impairment in the third quarter of each year, or more frequently if events and circumstances warrant.

Determining the fair value of a reporting unit or an indefinite-lived purchased intangible asset is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, and future economic and market conditions. The Company bases its fair value estimates on assumptions they believe to be reasonable but which are unpredictable and inherently uncertain. Actual future results may differ from those estimates.

There was no impairment loss recognized for the years ended June 30, 2009 and 2008.

Intangible Assets Subject to Amortization

Intangible assets subject to amortization that are acquired by the Company are carried at cost, less accumulated amortization. Depending on the materiality of the intangible asset acquired, the Company utilizes a valuation specialist to value intangible assets and assist the Company in the determination of the appropriate amortizable lives.

Long-Lived Assets

In accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets , long-lived assets such as purchased intangibles and property, plant and equipment, subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount exceeds the fair value of the asset.

There was no impairment loss recognized for the years ended June 30, 2009 and 2008.

Other Assets

Included in other assets at June 30, 2009 and 2008, is $3,267 and $3,369, respectively, related to a 50% ownership interest in T&L Properties, Inc. The Company uses the equity method of accounting for this investment, with earnings and losses reported within other (income) expense, net, in the consolidated statements of operations. This investment has resulted in cumulative undistributed earnings of $3,267 at June 30, 2009, that are included as a part of equity of the investment.

Environmental Provision

The Company maintains a reserve based upon estimated liability associated with environmental conditions caused by past operations. A reserve is established when it is probable, in accordance with SFAS No. 5, Accounting for Contingencies , that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company maintained an environmental reserve at

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

June 30, 2009 and 2008 of $7,272 and $8,022, respectively. These estimated liabilities are subject to revision in future periods based on actual cost or new information.

Fair Value of Financial Instruments

The carrying amount of financial instruments, consisting of cash, trade accounts and other receivables, accounts payable, short-term borrowings and other liabilities, approximates their fair values at the balance sheet dates due to their relatively short maturities.

Minority Interest

The Company acquired a controlling interest in Silver Dollar Recycling, LLC during fiscal 2009 (Note 4). As part of the purchase price allocation, the equity relating to the non-controlling interest was classified as minority interest and shown in the mezzanine section of the consolidated balance sheet. Net income or loss attributable to the non-controlling interest is shown as a separate line item on the consolidated statement of operations and increases or reduces the minority interest account on the consolidated balance sheet.

Adjustments to Members’ Equity and Goodwill

Due to facts and circumstances identified in fiscal year 2009, immaterial adjustments were made to members’ equity as follows:

• i. Reclassification of contributed assets between goodwill and Simsmetal West members’ equity of $3,774.

• ii. Reclassification of members’ equity from Adams Steel to Simsmetal West of $6,897.

• iii. Reclassification between equity investment and Adams Steel members’ equity of $338.

• iv. Reclassification of the purchase price of Oxnard Metals, Inc. between goodwill and deferred tax liability of $1,577.

Income Taxes

The Company, as an LLC, operates as a limited liability company, which is treated as a partnership for income tax purposes and consequently is not subject to federal income taxes. For California tax purposes, the Company is subject to certain state franchise taxes. The Members are required to include their proportionate share of the Company’s income or loss in their own tax returns.

A number of the Company’s consolidated wholly owned subsidiaries are corporations. Income taxes for these entities are accounted for under the asset and liability method of SFAS No. 109, Accounting for Income Taxes . Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be ultimately realized.

The Company has elected not to early adopt the application of FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes – an Interpretation of SFAS No. 109 , and will continue to evaluate its uncertain tax positions pursuant to SFAS No. 5, Accounting for Contingencies .

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Comprehensive Income

There are no comprehensive income (loss) items other than net income. Comprehensive income equals net income for all of the periods presented.

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

Recently Issued Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements , which defines fair value, establishes a framework for using fair value to measure assets and liabilities, and expands disclosures about fair value measurements. The statement applies whenever other statements require or permit assets or liabilities to be measured at fair value. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. The adoption of SFAS No. 157 is further discussed in Note 8. In accordance with FASB Staff Position (“FSP”) SFAS No. 157-2, Effective Date of SFAS 157, the Company deferred the adoption of SFAS No. 157 for one year for nonfinancial assets and nonfinancial liabilities that are recognized or disclosed at fair value in the financial statements on a nonrecurring basis. The Company is currently evaluating the potential impact of adopting FSP SFAS No. 157-2 on the consolidated financial statements.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (“SFAS No. 141(R)”) which replaces SFAS No. 141, Business Combinations (“SFAS No. 141”), originally issued in June 2001. SFAS No. 141(R) has a broader scope than SFAS No. 141, and applies the method of accounting from SFAS No. 141 to all transactions and other events in which one entity obtains control over one or more other businesses. Companies are required to apply the new standard prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008; earlier adoption is prohibited. SFAS No. 141(R) will have no effect on the Company’s financial statements unless and until the Company enters into a new business combination.

In December 2007, the FASB issued SFAS No. 160, Non-controlling Interests in Consolidated Financial Statements — An Amendment of ARB No. 51 (“SFAS No. 160”). SFAS No. 160 establishes new accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. Companies are required to adopt SFAS 160 for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008; earlier adoption is prohibited. Management is currently evaluating the potential impact of adopting SFAS No. 160 on the Company’s consolidated financial statements.

In April 2008, the FASB issued Staff Position No. 142-3, Determination of the Useful Life of Intangible Assets. The position amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of the recognized intangible asset under SFAS No. 142. Under the position, companies are required to consider their own historical experience in renewing or extending similar arrangements and in the absence of historical experience, companies are required to consider the assumptions that market participants would use regarding renewal or extension, adjusted for company-specific factors. The position will be effective for fiscal years beginning after December 15, 2008. The position must be applied

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

prospectively to intangible assets acquired after the effective date. The adoption of this position will not have an impact on the Company’s financial statements unless or until the Company enters into a business combination for which defensive assets exist.

In August 2008, Emerging Issues Task Force No. 08-6, Equity Method Investment Accounting Considerations, was issued to clarify the initial recognition and measurement and subsequent measurement issues associated with accounting for equity method investments. The issue will be effective for the transactions occurring in the fiscal years beginning on or after December 15, 2008. The adoption of this position will not have an impact on the Company’s financial statements unless or until the Company enters into a transaction for which these investments exists.

In August 2008, Emerging Issues Task Force No. 08-7, Accounting for Defensive Intangible Assets, was issued to address the accounting for defensive intangible assets after initial measurement. The issue applies to all intangible assets acquired, including intangible asset acquired in a business combination, in situations in which the acquirer does not intend to actively use the asset but intends to hold the asset to prevent its competitors from obtaining access to the asset. The issue will be effective for intangible assets acquired on or after the fiscal year beginning on or after December 15, 2008. The adoption of this issue will not have an impact on the Company’s financial statements unless or until the Company enters into a new business combination for which defensive intangible assets exists.

In October 2008, the FASB issued Staff Position No. 157-3, Determining the Fair Value of a Financial Assets When the Market for That Asset is Not Active. The position clarifies the application of SFAS No. 157 in a market that is not active. This position was effective for the period. The adoption of this position will not have an impact on the Company’s financial statements.

In April 2009, the FASB issued Staff Position No. 141(R)-1, Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies. The position clarifies initial recognition and measurement, subsequent measurement and accounting and disclosures for assets and liabilities from contingencies in a business combination. The position has the same effective date as SFAS No. 141(R) and therefore will be effective for all business combinations on or after the beginning of fiscal years beginning on or after December 15, 2008. The adoption of this position will have no effect on the Company’s financial statements unless and until the Company enters into a new business combination.

In April 2009, the FASB issued two new accounting standards which are required to be adopted no later than periods ending after June 15, 2009. For the year ended June 30, 2009 the Company adopted the following provisions, which did not result in any impact to the Company’s financial statements:

(i) FASB Staff Position No. 157-4, Determining Whether a Market is Not Active and a Transaction Is Not Distressed provides guidelines for making fair value measurement more consistent with the principles presented in SFAS No. 157. FSP FAS No. 157-4 provides additional authoritative guidance in determining whether a market is active or inactive, and whether a transaction is distressed, is applicable to all assets and liabilities (i.e. financial and nonfinancial) and will require enhanced disclosures.

(ii) FASB Staff Position No. 115-2 and No. 124-2, Recognition and Presentation of Other-Than-Temporary Impairments provides additional guidance to provide greater clarity about the credit and noncredit component of an other-than-temporary impairment event and to

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

improve presentation and disclosure of other-than-temporary impairments in the financial statements.

3. Significant Noncash Investing and Financing Transactions

During the year ended June 30, 2008, the Company engaged in the following significant noncash investing and financing transactions with regards to the contributions received from Adams Steel and Simsmetal West on September 1, 2007:

	2009	2008
Contribution received from Adams Steel upon execution of Operating Agreement on September 1, 2007	$ (7,235)	$ 73,762
Contribution received from Simsmetal West upon execution of Operating Agreement on September 1, 2007	$ 3,123	$210,199

The assets and liabilities contributed were recorded at net book value. The 2009 activity reflects reclassifications made during 2009 to the initial contributions recorded (Note 2).

4. Acquisitions

During the years ended June 30, 2009 and 2008, the Company acquired one entity and five entities, respectively. The acquisitions have been accounted for as purchases in accordance with SFAS No. 141, Business Combinations . These acquisitions expanded on the Company’s ability to access suppliers of scrap metals and increase the processing of ferrous and non-ferrous scrap metals. The costs of the acquisitions were allocated to the assets acquired and liabilities assumed based on estimates of their respective fair market values at the dates of the acquisitions. In determining fair market value, considerations were taken for market comparables, condition of assets acquired, historical and prospective financial performance of the acquired entities, and expectations on future outlooks for the industry. The results of the acquired entities are included from the dates of acquisition to June 30, 2009 and 2008.

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Silver Dollar Recycling, LLC Acquisition

On September 5, 2008, the Company acquired 70.295% of the membership interest of Silver Dollar Recycling, LLC (“SDR”) for $59,674. SDR is in the business of purchasing, processing and selling ferrous and non-ferrous scrap metals. The following table summarizes the allocation of purchase price to the acquired assets and assumed liabilities of SDR at the date of acquisition.

Purchase consideration
Cash consideration	$ 55,192
Promissory note	4,236
Direct transaction costs	246
	$ 59,674
Allocation
Tangible assets acquired
Cash	$ 1,722
Inventories	1,432
Property, plant and equipment	11,571
Identifiable intangible assets acquired
Non-compete (amortization period of 4 years)	351
Tradename (amortization period of 15 months)	2,397
Supplier relationships (amortization period of 10 years)	23,252
Goodwill	26,752
Total assets acquired	67,477
Liabilities assumed
Environmental liabilities	(474)
Minority Interest	(7,329 )
	$ 59,674

Upon completion of purchase accounting, an indefinite-lived tradename was identified. In the fourth quarter of 2009, the Company converted the indefinite-lived tradename to definite lived and assigned a 15 month useful life. The Company plans to terminate use of the existing tradename at the end of fiscal year 2010.

The Amended and Restated Operating Agreement of SDR provides a member with a 25.250% interest the right, at its option, to require the Company to purchase or redeem all of its interest in SDR during the period from July 1, 2009 through December 31, 2011 (the “Put Option”). In conjunction with the Put Option, the Company has the right to purchase the remaining 4.455% interest in SDR (the “Call Option”). The purchase price under the Put Option and Call Option shall be the purchase price that would have been paid for these interests under the original acquisition of the controlling interest of SDR, less distributions paid other than tax distributions, plus 5% per annum compounded annually.

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Pacific Coast Recycling LLC Acquisition

On May 23, 2008, the Company acquired 100% of the membership interest of Pacific Coast Recycling LLC (“PCR”) for $111,788. PCR is in the business of purchasing, processing and selling ferrous and non-ferrous scrap metals. The following table summarizes the estimated allocation of purchase price to the acquired assets and assumed liabilities of PCR at the date of acquisition. As of June 30, 2008, the Company owed the seller of PCR $19,915 for the working capital adjustment, which was paid during fiscal year 2009.

Purchase consideration
Cash consideration	$109,469
Direct transaction costs	2,319
	$111,788
Allocation
Tangible assets acquired
Accounts receivable	$ 21,338
Inventories	65,646
Prepaid expenses	1,241
Asset held for sale (Note 6)	5,711
Property, plant and equipment	37,210
Identifiable intangible assets acquired
Supplier relationships (amortization period of 10 years)	2,478
Total assets acquired	133,624
Liabilities assumed
Current liabilities	(21,345)
Long-term debt	(491 )
Total liabilities assumed	(21,836)
	$ 111,788

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SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Oxnard Metals, Inc. Acquisition

On November 30, 2007, the Company acquired 100% of the common stock of Oxnard Metals, Inc. (“Oxnard”) for $7,046. Oxnard is in the business of purchasing, processing and selling ferrous and non-ferrous scrap metals. The following table summarizes the final allocation of purchase price to the acquired assets and assumed liabilities of Oxnard at the date of acquisition.

Purchase consideration
Cash consideration	$ 6,617
Direct transaction costs	429
	$ 7,046
Allocation
Tangible assets acquired
Cash	$ 365
Accounts and other receivable	345
Inventories	227
Property, plant and equipment	1,957
Identifiable intangible assets acquired
Supplier relationships and other (amortization period of 7 to 10 years)	3,818
Goodwill	2,455
Total assets acquired	9,167
Liabilities assumed
Current liabilities	(544)
Deferred tax liabilities	(1,577 )
Total liabilities assumed	(2,121)
	$ 7,046

During the year ended June 30, 2008, the Company acquired 100% of three other entities. The total purchase price for these three acquisitions was $3,289.

5. Inventories

Inventories are stated at the lower of cost or market. Cost for ferrous and non ferrous metals is determined using the average cost method. Inventories consist of the following categories at June 30:

	2009	2008
Ferrous metals	$ 41,644	$ 59,199
Non-ferrous metals	6,610	10,996
Other	178	311
Total inventories	$48,432	$ 70,506

The Company makes certain assumptions regarding future demand and net realizable value in order to assess that inventory is properly recorded at the lower of cost or market. The assumptions are based on both historical experience and current information. Due to declines in the future

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

selling prices of scrap metal in the first quarter of fiscal 2009, the Company recorded an adjustment of $487 to reduce the value of its inventory (and increase cost of sales) at December 31, 2008 to the lower of cost or market. The Company did not record an additional adjustment for lower of cost or market as of June 30, 2009. The Company did not have any adjustments for the lower of cost or market in fiscal 2008.

6. Property, Plant and Equipment

A summary of property, plant and equipment is as follows at June 30:

	2009	2008
Land	$ 70,907	$ 56,789
Buildings and land improvements	13,920	6,474
Leasehold improvements	11,330	8,682
Plant and equipment	127,277	100,706
Construction in progress	9,726	32,091
	233,160	204,742
Less: Accumulated depreciation	(27,360 )	(10,485 )
Property, plant and equipment, net	$205,800	$194,257

Construction in progress includes $5,711 for an asset held for sale at June 30, 2008. This asset was returned to the vendor during fiscal 2009 at its carrying value.

Depreciation expense amounted to $17,070 and $10,485 for the years ended June 30, 2009 and 2008, respectively.

7. Goodwill and Intangible Assets

The following table presents the changes in the carrying value of goodwill for the years ended June 30, 2009 and 2008:

Balance at June 30, 2007	$ —
Contributions	137,346
Acquisitions	1,351
Balance at June 30, 2008	138,697
Adjustment (Note 2)	(2,197 )
Acquisitions	26,752
Balance at June 30, 2009	$ 163,252

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

Intangible assets consist of the following at June 30, 2009:

Amortization Period	Gross Carrying Amount	Accumulated Amortization	Net
Intangible assets subject to amortization
Supplier relationships 7 to 10 years	$44,800	$ (7,880)	$36,920
Tradenames 15 months	2,822	(571 )	2,251
Other Lesser of term of agreement or useful life	1,685	(833)	852
	49,307	(9,284 )	40,023
Intangible assets not subject to amortization
Permits	$ 3,250	$ —	$ 3,250
Intangible assets consist of the following at June 30, 2008: Total net intangible assets Amortization Period	$52,557 Gross Carrying Amount	$ (9,284) Accumulated Amortization	$43,273 Net
Intangible assets subject to amortization
Supplier relationships 7 to 10 years	$21,548	$ (2,608)	$18,940
Other Lesser of term of agreement or useful life	1,759	(353 )	1,406
	23,307	(2,961)	20,346
Intangible assets not subject to amortization
Permits	3,250	—	3,250
Total net intangible assets	$ 26,557	$ (2,961 )	$ 23,596

Amortization expense amounted to $6,363 and $2,961 for the years ended June 30, 2009 and 2008, respectively.

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

A summary of the expected amortization expense for the succeeding periods as of June 30, 2009 is as follows:

Fiscal years ending June 30,
2010	$ 8,511
2011	6,027
2012	6,004
2013	4,076
2014	3,091
Thereafter	12,584 $40,293

8. Fair Value of Financial Instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value is offset by the assessment of the Company’s or counterparty’s non-performance risk. To determine fair value, the Company primarily utilizes reported market transactions and discounted cash flow analyses. SFAS No. 157, Fair Value Measurements , was adopted by the Company for financial assets and liabilities effective July 1, 2008. The adoption of SFAS No. 157 for non-financial assets and liabilities has been deferred for one year.

Long-Term Debt Instruments

The fair value of the long-term debt instruments are determined by a valuation model which is based on discounted future cash flows of the instruments using current market rates. The carrying amounts and fair values of the debt instruments as of June 30, 2009 were as follows:

	Carrying	Fair
	Value	Value
Revolving credit and letter of credit facility	$130,750	$129,330
Notes Payable	878	878

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

9. Credit Facilities and Long-Term Debt

Credit facilities and long-term debt consist of the following at June 30:

	2009	2008
Noncurrent debt
Revolving credit and letter of credit facility	$130,750	$138,800
Other	607	1,345
Total long-term debt	131,357	140,145
Current debt
Term loan	—	100,000
Loans from related parties (Note 15)	—	5,000
Other	271	184
Total current debt	271	105,184
Total debt	$131,628	$245,329

Revolving Credit and Letter of Credit Facilities

On September 4, 2007, the Company entered into a $150,000 unsecured revolving line of credit and letter of credit facility, which has a maturity date of October 1, 2010 (the “Credit Agreement”), with Bank of America, N.A., in order to fund working capital requirements and other capital requirements to operate the business. As of June 30, 2009 and 2008, the Company had outstanding credit facility borrowings of $130,750 and $138,800, respectively, a standing letter of credit in the amount of $5,370 and $1,460, respectively, and $13,880 and $9,740, respectively, available to borrow. The debt is severally guaranteed by both of the equity members of the Company.

Borrowings under the facility bear interest, at the Company’s option, at either the prime rate plus the applicable margin as defined in the credit agreement (ranging from -1.4% to -2.55%) or Eurocurrency rate loan (defined as London InterBank Offered Rates (“LIBOR”)) plus the applicable margin as defined in the credit agreement (ranging from 0.875% to 1.4%). Borrowings are deemed to be prime rate loans, unless a Eurocurrency rate loan is requested. The interest rate at June 30, 2009 and 2008 was 1.19% and 2.65%, respectively.

In accordance with the Credit Agreement, the Company pays a quarterly unutilized facility fee calculated as 1/4 of 1% per annum times the daily amount available to be drawn under the facility, as well as for each standby letter of credit equal to the applicable margin (as defined in the agreement) times the daily amount available to be drawn under any letter of credit.

The Credit Agreement contains, among other provisions, certain defined financial and non-financial covenants including a maximum cash flow gearing ratio, interest coverage ratio, a minimum tangible net worth and the requirement to provide audited financial statements in compliance with accounting principles generally accepted in the United States of America within 120 days of the Company’s year end. At June 30, 2009 and 2008, the Company was in compliance with these covenants.

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

On September 10, 2008, the Company entered into a $50,000 unsecured revolving line of credit (the “Second Agreement”), which has a maturity date of June 30, 2010, with Fifth Third Bank and Union Bank of California, in order to fund working capital and other general business purposes. As of June 30, 2009 the Company had no outstanding borrowings on this credit facility. The debt is severally guaranteed by both of the equity members of the Company.

Borrowings under the facility bear interest, at the Company’s option, at either the prime rate plus 0.5% or LIBOR plus 2.25%. The rate to be used is determined upon each borrowing. In accordance with this agreement, the Company pays a quarterly unutilized facility fee calculated as 0.30% per annum times the daily amount available to be drawn under the facility, as well as 0.125% for each standby letter of credit equal to the applicable margin (as defined in the agreement) times the daily amount available to be drawn under any letter of credit.

The Second Agreement contains, among other provisions, certain defined financial and non-financial covenants including a maximum cash flow gearing ratio, an interest coverage ratio, a minimum tangible net worth and the requirement to provide audited financial statements in compliance with accounting principles generally accepted in the United States within 90 days of the Company’s year end. At June 30, 2009, the Company was in compliance with these covenants.

Term Loan

On May 23, 2008, the Company entered into a one year $100,000 term loan agreement with Fifth Third Bank as the agent, of which $40,000 was funded by Fifth Third Bank, $40,000 was funded by California Bank & Trust and $20,000 was funded by HSBC. This term loan was entered into to finance the acquisition of PCR. As of June 30, 2008, $100,000, was outstanding under the term loan. The term loan was paid in full during fiscal year 2009.

Other

Additionally, the Company had $878 and $1,529 as of June 30, 2009 and 2008, respectively, of notes payable to various individuals as a result of 2008 acquisitions.

These notes have principal and interest payments of $29 a month and mature between fiscal years 2011 and 2013.

Annual maturities are as follows:

Years ending June 30,
2010	$ 271
2011	131,056
2012	223
2013	78
2014	—
Thereafter	—
	$ 131,628

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

10. Members’ Equity

The Company was formed as a limited liability company (“LLC”) in the State of Delaware on June 4, 2007. The Operating Agreement of SA Recycling, LLC (the “Operating Agreement”) was made effective as of September 1, 2007 by and between Adams Steel and Simsmetal West, both limited liability companies organized in the State of Delaware. In consideration for assets received, both Adams Steel and Simsmetal West received a 50% percentage interest in the Company. The Company’s profit and losses are allocated in proportion to the Members respective percentage interest. Additional capital contributions are not permitted unless unanimously approved by all Members. If approved, contributions will be a pro rata portions of the aggregate capital contributions approved based on each Member’s percentage interest. No Member has an obligation to make any loans or advances or guarantee any of the obligations, although they have chosen to guarantee certain obligations. Distributions are to be made, as determined by the Board of Directors and to the extent of available cash, pro rata according to the Members’ unit percentage interests. Cash distributions will be made solely from cash available for distributions as defined in the Operating Agreement. Additionally, tax distributions will be made quarterly to each Member in accordance with the methodology established in the Operating Agreement. Total distributions of $28,210 and $43,937 were made to each Member during the years ended June 30, 2009 and 2008, respectively.

11. Defined Contribution and Union Pension Plans

The Company has a 401(k) defined contribution plan (the “Plan”) which covers substantially all employees of the Company. Plan participants may make voluntary contributions up to the lesser of 100% of their earnings or the statutory limitation. Employer contributions consist of qualified non-elective contributions equal to 3% of compensation and qualified non-elective contributions of 3% for income in excess of the social security wage base. These contributions are not subject to vesting under safe harbor provisions. Additionally, discretionary supplemental employer contributions in the year following each plan year end may be made. The discretionary contributions, if applicable, vest over a five-year service period; 20% vests after the first year and an additional 20% vests for each year of service to the Company thereafter. Expense related to the Plan was approximately $1,565 and $1,485 for the years ended June 30, 2009 and 2008, respectively.

The Company made contributions to the union-sponsored trust fund, which provides pension benefits to employees covered by collective bargaining agreements. The Company’s contributions amounted to $459 for the year ended June 30, 2009.

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

12. Commitments and Contingencies

Operating Leases

The Company has various operating lease agreements related to equipment and facilities, which expire at various dates through August 2024. Rent expense under such agreements was $12,833 and $3,930 for the years ended June 30, 2009 and 2008, respectively. A summary of minimum future lease commitments under noncancelable long-term operating leases, including the anticipated exercise of lease extension options, for the succeeding periods as of June 30, 2009 is as follows:

Fiscal years ending June 30,
2010	$ 13,194
2011	12,491
2012	11,756
2013	9,991
2014	6,401
Thereafter	38,016
	91,849

Legal Matters

From time to time, the Company is involved in various litigation matters involving ordinary and routine claims incidental to its business. A portion of these matters result from environmental compliance issues and workers compensation related claims arising from the Company’s operations. There are presently no legal proceedings pending against the Company, which, in the opinion of the Company’s management, is likely to have a material adverse effect on its business, financial condition or results of operations.

Environmental Matters

The Company is subject to comprehensive local, state, federal and international regulatory and statutory environmental requirements relating to, among others, the acceptance, storage, treatment, handling and disposal of solid waste and hazardous waste, the discharge of materials into air, the management and treatment of wastewater and storm water, the remediation of soil and groundwater contamination, the restoration of natural resource damages and the protection of employees’ health and safety. The Company believes that it and its subsidiaries are in material compliance with currently applicable statutes and regulations governing the protection of human health and the environment, including employee health and safety. However, environmental legislation may in the future be enacted and create liability for past actions and the Company or its subsidiaries may be fined or held liable for damages.

The Company’s environmental risk analysis indicates that significant remedial costs are possible if regulatory actions are triggered; however, there are certain mitigating factors that decrease the likelihood that major remedial actions will be required over the next five years. The primary factor is that a majority of the known and suspected impacts at these facilities currently lack a regulatory trigger and a related factor is the industrial nature of the general site areas. These factors, in conjunction with plans to continue to expand the paved portions of the sites, serve to reduce the likelihood of new agency-driven remedial actions. To the extent that issues arise, the Company should continue to be able to address them through its normal operating and capital budgets. It

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

appears unlikely that the management of potential impact issues, in the aggregate, would significantly exceed the recorded reserve balance over the next five years.

The Company evaluates the adequacy of its environmental reserves on an annual basis in accordance with Company policy. Adjustments to the liabilities are made when additional information becomes available that affects the estimated costs to study or remediate any environmental issues or expenditures for which reserves were established.

13. Balance Sheet Information

Accrued Liabilities

Accrued liabilities consist of the following at June 30:

	2009	2008
Working capital adjustment for PCR acquisition (Note 4)	$ —	$ 19,915
Accrued payroll, bonus and other employee benefits	5,260	10,936
Other	590	1,588
	$ 5,850	$ 32,439

14. Income Taxes

The provision for income taxes primarily relates to tax on the income before provision for income taxes of the Company’s wholly owned subsidiaries that are corporations.

Significant components of the income tax provision for the year are as follows:

Current
Federal	$ 652
State	132
	784
Deferred
Federal	(166)
State	(26 )
	(192)
Total income tax provision	$ 592
Deferred tax liabilities consist of the following components as of June 30, 2009: Noncurrent deferred income taxes
Deferred tax liabilities
Intangible asset amortization	1,247
Other, net	31
Total deferred tax liabilities	1,278
Noncurrent deferred tax liabilities	$ 1,278

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Table of Contents

SA Recycling, LLC and Subsidiaries Notes to Consolidated Financial Statements June 30, 2009 and 2008

(in thousands of dollars)

15. Sales Commitments

The Company entered into a foreign sales agreement with Sims Group Global Trade Corporation (“Global Trade”) effective September 1, 2007. The Company appointed Global Trade on an exclusive basis to export the Company’s ferrous goods to non-domestic locations (defined as locations outside of the United States of America and Mexico). As part of the agreement, the Company must make available to Global Trade no less than 85% of the Company’s total inventory each month for foreign sales. The agreement defines total inventory as the existing ferrous inventory for the month and the forecasted ferrous inventory of scrap for the following 90 calendar days. The agreement terminates upon written notification by either party and 90 day notice.

16. Related Party Transactions

In addition to those described elsewhere, the Company had the following transactions with related parties:

The Company’s largest customer, Global Trade, is a related party. Another company, Sims Asia Holdings Limited (“CME”), is a related party and a commissioned agent on behalf of the Company. Gross sales balances of $81,113 and $85,431 for the fiscal years ended June 30, 2009 and 2008, respectively, represent sales made through CME to third parties during the year. The Company experienced the following sales to and amounts due from Global Trade for the years ended June 30, 2009 and 2008 as part of operating activities:

2009
Gross sales	$736,453
Total due to the Company	$ 10,014
2008
Gross sales	$ 635,668
Total due to the Company	$153,014

The Company had aggregated related party payables of $11,048 and $3,638 at June 30, 2009 and 2008, respectively, to various Sims Metal Management entities.

During fiscal years 2009 and 2008, the Company purchased inventory of $51,837 and $5,598, respectively, from various Sims Metal Management Entities and other related parties.

On June 9, 2008, the Company issued a note payable to each of the two Members in exchange for proceeds of $2,500 for each note. The notes were issued for the purpose of sustaining the operating cash flow of the Company. The notes were paid during fiscal year 2009.

17. Subsequent Events

The Company has performed an evaluation of subsequent events through July 31, 2009, which is the date the financial statements were available to be issued.

F-103

EX-4.8 c53813exv4w8.htm EX-4.8

Exhibit 4.8

Deed of Release

Sims Metal Management Limited Jeremy Sutcliffe

==> picture [144 x 60] intentionally omitted <==

Level 12

60 Carrington Street SYDNEY NSW 2000 DX 262 SYDNEY NSW Tel: (02) 8915 1000 Fax: (02) 8916 2000 www.addisonslawyers.com.au Ref: JLM:SIM001/4001 363323_1.DOC

3 6 6 6 7 7 7 8 8 9 9 9 9 9 10 13

16

Table of Contents

1. Defined terms and interpretation

2. Termination of Employment

3. Termination Entitlements

4. Release

5. Return of Property

6. Confidentiality and Continuing Obligations

7. Resignation from offices and Indemnity

8. Restraint

9. Confidentiality of Deed

10. Public Statements

11. Acknowledgements

12. Benefit of Deed

13. Bar

14. Notices 15. General

Schedule 1 — Termination Entitlements Schedule 2 — Announcement

1

DETAILS

Date:

Parties

• (1) Sims Metal Management Limited (“Sims”)

ABN 69 114 838 630 Address Sir Joseph Banks Corporate Park Suite 3, Level 2 32 — 34 Lord Street BOTANY NSW 2019 Fax (02) 9902 6006 Attention Company Secretary Jeremy Sutcliffe (“Executive”) Address 26 Prince Albert Street MOSMAN NSW 2088

• (2) Jeremy Sutcliffe (“Executive”)

Recitals

• A. The Executive commenced his employment with the Sims Group in or about 1989.

• B. The Executive was employed pursuant to the First Contract from 1 March 2002.

• C. The Executive was employed pursuant to the Second Contract from in or about October 2005.

• D. The parties have agreed that the Employment came to an end with effect from 31 July 2009 as a result of Sims determining that it no longer required the functions, duties and responsibilities then performed by the Executive to be performed by anyone.

• E. The Executive made claims against Sims arising out of the Termination, including claims that Sims had breached the Second Contract.

• F. Sims rejected the claims made by the Executive.

• G. Sims and the Executive have agreed to:

• (a) the termination of the Employment on the Termination Date;

2

• (b) the Termination Entitlements to be paid or provided by Sims to the Executive as set out in Schedule 1;

• (c) a release of all Claims that the Executive may have against Sims; and

• (d) a restraint on competition with Sims,

on the terms set out in this deed.

Operative Parts

1. Defined terms and interpretation

• 1.1 Defined terms

The following definitions apply unless the context requires otherwise.

Business Day means:

• (a) for the purpose of sending or receiving a notice, a day which is not a Saturday, Sunday, a bank holiday or a public holiday in the city where the notice is received; and

• (b) for all other purposes, a day which is not a Saturday, Sunday, a bank holiday or a public holiday in Sydney.

Business Hours means from 9.00am to 5.00pm on a Business Day.

Claim means any right, entitlement, charge, action, suit, proceeding, verdict, judgment, damage, loss, penalty, fine, interest, cost, expense, liability, claim, demand or cause of action (whether based in contract, tort, statute or equity) and whether or not prospective or contingent, present or future, fixed or unascertained, actual or contingent, known or unknown.

Confidential Information has the meaning given it in the First Contract.

Corporations Act means the Corporations Act 2001 (Cth).

Details means, in relation to a party, the details for that party set out in this deed.

Employment means the Executive’s employment with Sims pursuant to the Second Contract.

First Contract means the contract of employment dated 28 February 2002 between the Executive and Simsmetal Limited (ACN 008 634 526) (now Sims Group Australia Holdings Limited (ACN 008 634 526)).

Notice has the meaning given in clause 14.1.

Related Body Corporate has the meaning given to it in the Corporations Act.

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Restraint Area means any country in the world where any member of the Sims Group conducts any business (whether now or in the future).

Restraint Period means the period commencing from the Termination Date and concluding on 31 October 2009.

Second Contract means the contract of employment dated 5 September 2005 between the Executive and Sims, incorporating certain provisions from the First Contract, and as varied by the letter from Sims to the Executive dated 24 September 2007.

Sims Group means

• (a) Sims;

• (b) any Related Body Corporate of Sims;

• (c) any entity that controls, is controlled by or is under common control with, Sims; and

• (d) any other entity that is connected with Sims or any other member of the Sims Group by a common interest in an economic enterprise including, without limitation, a partner or another member of a joint venture.

Termination means the termination of the Employment with effect from the Termination Date.

Termination Date means 31 July 2009.

Termination Entitlements means the payments and entitlements set out in Schedule 1 to be paid or provided to the Executive or as the Executive otherwise directs in writing.

1.2

Interpretation

In this deed, except where the context otherwise requires:

• (a) the singular includes the plural and vice versa and a gender includes other genders;

• (b) other grammatical forms of a defined word or expression have a corresponding meaning;

• (c) a reference to a clause, paragraph, schedule or annexure is to a clause or paragraph of or schedule or annexure to this deed and a reference to this deed includes any schedule and annexure;

• (d) a reference to a document or agreement, includes the document or agreement as novated, altered, supplemented or replaced from time to time;

• (e) a reference to A$, $A, dollar or $ is to Australian currency;

4

• (f) a reference to time is to Sydney time;

• (g) a reference to a year (other than a financial year) or a month means a calendar year or calendar month respectively;

• (h) a reference to a party is to a party to this deed, and a reference to a party to a document includes the party’s executors, administrators, successors and permitted assigns and substitutes;

• (i) a reference to a person includes a natural person, partnership, firm, body corporate, trust, joint venture, association, governmental or local authority or agency or other entity;

• (j) a reference to a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;

• (k) any authorities, associations, bodies and entities whether statutory or otherwise will, in the event of such authority, association, body or entity ceasing to exist or being reconstituted, replaced or the powers or functions thereof being transferred to or taken over by any other authority, association, body or entity, be deemed to refer respectively to the authority, association, body or entity established, constituted or substituted in lieu thereof which exercises substantially the same powers or functions;

• (l) the meaning of general words is not limited by specific examples introduced by including, for example or similar expressions;

• (m) any agreement, representation, warranty or indemnity by two or more parties (including where two or more persons are included in the same defined term) binds them jointly and severally;

• (n) any agreement, representation, warranty or indemnity in favour of two or more parties (including where two or more persons are included in the same defined term) is for the benefit of them jointly and severally;

• (o) a rule of construction does not apply to the disadvantage of a party because the party was responsible for the preparation of this deed or any part of it; and

• (p) if a day on or by which an obligation must be performed or an event must occur is not a Business Day, the obligation must be performed or the event must occur on or by the next Business Day.

1.3 Headings

Headings are for ease of reference only and do not affect interpretation.

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2. Termination of Employment

2.1 Termination Date

The Employment terminated on the Termination Date.

2.2 Redundancy

The parties acknowledge that the Employment terminated by reason of the redundancy of the Executive’s position on the Termination Date.

2.3 Survival

Subject to the terms of this deed, the obligations of the Executive under the following provisions of the First Contract will continue to apply after the Termination:

• (a) clause 13 (Confidential Information); and

• (b) clause 14 (assignment of intellectual property rights).

3. Termination Entitlements

• (a) Sims agrees to pay or provide the Termination Entitlements on the date of this deed, or as otherwise agreed between the parties, to the Executive as required under the terms of this deed. Sims may withhold such amounts from the Termination Entitlements as required by any taxation or superannuation laws.

• (b) The Termination Entitlements will be treated as having satisfied the conditions for “genuine redundancy” for Australian taxation purposes.

• (c) The Executive agrees that:

  • (i) the Termination Entitlements include the full amounts, benefits and entitlements that the Sims Group owes the Executive, whether for salary, wages, allowances, bonuses, incentives under any discretionary scheme, short term incentives, long term incentives, equity based incentives, or other remuneration, leave entitlements, payment in lieu of notice, severance pay, or anything else connected with the Employment and the termination of the Employment; and

  • (ii) the Executive will not be entitled to any other amount or benefit whatsoever in respect of the Employment or the termination of the Employment except as expressly set out in this deed.

4. Release

4.1 Satisfaction of rights

The Executive agrees that this deed fully satisfies the rights that the Executive, and anyone who claims through the Executive, has or may have against the Sims Group or

6

4.2

any of its officers, employees, agents and professional advisers arising directly or indirectly out of the matters recited, including the Employment and the Termination.

Executive Release

The Executive hereby releases and forever discharges each member of the Sims Group and each of its officers, employees, agents and professional advisers from all Claims arising directly or indirectly out of the matters recited, including the Employment and the Termination.

5. Return of Property

On or before the date of this deed, and subject to the terms of this deed, the Executive must return to Sims:

• (a) all property belonging to the Sims Group or its customers or clients (including, without limitation, cards, keys, motor vehicles, equipment and materials) that the Executive has, or can reasonably obtain; and

• (b) all material (in whatever form, including electronic form) that the Executive has, or can reasonably obtain, that contains Confidential Information relating to the business of the Sims Group or its organisation or affairs.

6.

Confidentiality and Continuing Obligations

The Executive remains under an ongoing duty not to use or disclose any Confidential Information belonging or relating to the Sims Group. The Executive continues to be bound, and agrees to abide, by the Executive’s obligations set out in clause 13 and clause 14 of the First Contract which continue after the Termination.

7. Resignation from offices and Indemnity

7.1 Resignation

By the date of this deed, or such other date specified in writing by Sims, the Executive must resign from all directorships, offices and positions that the Executive holds in the Sims Group or in any external organisation in connection with the Employment.

7.2 Authority

If the Executive does not immediately resign from all such directorships, offices and positions in accordance with this clause, the Executive authorises Sims (or any persons authorised by Sims) to do all things and execute all documents necessary on behalf of the Executive to give effect to these resignations.

7.3 Indemnity

Notwithstanding the Termination, the Deed of Access, Indemnity and Insurance dated 8 June 2006 between the Executive and Sims will continue to apply in accordance with its terms.

7

8. Restraint

8.1 Restrained Activities

In consideration for the payments referred to in the Schedule 1 the Executive agrees that, during the Restraint Period, the Executive must not anywhere in the Restraint Area:

• (a) engage or prepare to engage in any business activity which:

• (i) is the same or similar to that part or parts of the business carried on by any member of the Sims Group; or

• (ii) is in competition with the business carried on by any member of the Sims Group;

• (b) solicit, canvass, approach or accept any approach from any person who was, at any time during the Executive’s last 12 months of employment with Sims, a customer of Sims, with a view to obtaining the custom of that person in a business that is the same or similar to the business conducted by Sims or is in competition with the business conducted by Sims;

• (c) interfere with the relationship between Sims and its customers, employees or suppliers; or

• (d) induce or assist in the inducement of any employee of any member of the Sims Group to leave their employment.

8.2 Meaning of “engage in”

The term “engage in” in clause 8.1 means to participate, assist or otherwise be directly or indirectly involved as a member, person with a substantial holding (as defined in the Corporations Act), director, consultant, adviser, contractor, principal, agent, manager, employee, beneficiary, partner, associate, trustee or financier.

8.3 Restraint is reasonable

The Executive agrees that the restraint in clause 8.1 is in the circumstances reasonable and necessary to protect the legitimate interests of Sims.

9. Confidentiality of Deed

9.1 No disclosure

Each party must not disclose the terms or content of this deed or any discussions and correspondence relating to the negotiation of this deed, unless the other party first agrees in writing.

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9.2 Exceptions

Clause 9.1 does not prevent a party from disclosing information to the party’s lawyer or accountant, where the law requires that the information must be disclosed or to enforce this deed.

10. Public Statements

• 10.1 The parties agree that Sims will issue an announcement regarding the Employment and the Termination in the terms set out in Schedule 2.

• 10.2 Prior to making any further public statement regarding the Employment, the Termination, or the Termination Entitlements,(not including in any annual or remuneration report), Sims must first consult with the Executive about the reasons for and proposed terms of the public announcement and give the Executive a reasonable opportunity to discuss with Sims any suggested amendments to the proposed public announcement.

11. Acknowledgements

Bothe parties acknowledge and agree that:

• (a) they have obtained legal advice about this deed; and

• (b) the terms of this deed are fair and reasonable.

12. Benefit of Deed

Sims has the benefit of this deed for itself and also in trust for each member of the Sims Group and each of its officers, employees, agents and professional advisers any of whom may independently enforce it against the Executive.

13. Bar

Each member of the Sims Group and each of its officers, employees, agents and professional advisers may use this deed, including as a bar, against the Executive in any court or other proceedings brought by the Executive or anyone who claims through the Executive.

The Executive may use this deed, including as a bar, against Sims in any court or other proceedings bought by Sims or anyone who claims through Sims.

14. Notices

14.1 Service of notices

A notice, demand, consent, approval or communication under this deed ( Notice ):

• (a) must be in writing and in English directed to the recipient’s address for notices specified in the Details (as varied by any Notice);

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• (b) must be hand delivered, left at or sent by prepaid post or facsimile to the recipient’s address for notices specified in the Details (as varied by any Notice); and

• (c) may be given by an agent of the sender.

14.2 Effective on receipt

A Notice given in accordance with clause 14.1 takes effect when received (or at a later time specified in it), and is taken to be received:

• (a) if hand delivered or left at the recipient’s address, on delivery;

• (b) if sent by prepaid post, the third Business Day after the date of posting, or the seventh Business Day after the date of posting if posted to or from outside Australia); and

• (c) if sent by facsimile, when the sender’s facsimile system generates a message confirming successful transmission of the entire Notice unless, within one Business Day after the transmission, the recipient informs the sender that it has not received the entire Notice,

but if the delivery or transmission under paragraph (a) or (c) is outside Business Hours, the Notice is taken to be received at the commencement of Business Hours after that delivery, receipt or transmission.

14.3 Process service

Any process or other document relating to litigation, administrative or arbitral proceedings in relation to this deed may be served by any method contemplated by this clause in addition to any means authorised by law.

15. General

15.1 Alterations

This deed may be altered only in writing signed by each party.

15.2 Approvals and consents

Except where this deed expressly states otherwise, a party may, in its discretion, give conditionally or unconditionally or withhold any approval or consent under this deed.

15.3

Assignment

A party may only assign this deed or a right under this deed with the prior written consent of each other party.

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15.4 Counterparts

This deed may be executed in counterparts. All executed counterparts constitute one document. This deed may be executed by either of the parties by duly executing a counterpart and forwarding a copy of the signed counterpart to the other party.

15.5 Costs

Sims shall bear its own costs in relation to, and associated with, this deed and giving effect to the deed. Any stamp duty assessed on this deed will be paid by Sims.

Sims shall bear the Executive’s costs in relation to and associated with the Employment, the Termination, this deed and giving effect to this deed, to a maximum amount of A$12,000 (excluding GST). Sims’ obligations under this clause are in addition to Sims’ previous agreements to pay invoices rendered by Clayton Utz to the Executive dated 31 March 2009 and 30 June 2009.

15.6

No merger

Except where this deed expressly states otherwise, the rights and obligations of the parties under this deed do not merge on completion of any transaction contemplated by this deed.

15.7 Entire agreement

This deed constitutes the entire agreement between the parties in connection with its subject matter and supersedes all previous agreements or understandings between the parties in connection with its subject matter.

15.8 Further action

Each party must do, at its own expense, everything reasonably necessary to give full effect to this deed and the transactions contemplated by it (including executing documents) and to use all reasonable endeavours to cause relevant third parties to do likewise.

15.9 Severability

If the whole or any part of a provision of this deed is invalid or unenforceable in a jurisdiction it must, if possible, be read down for the purposes of that jurisdiction so as to be valid and enforceable. If however, the whole or any part of a provision of this deed is not capable of being read down, it is severed to the extent of the invalidity or unenforceability without affecting the remaining provisions of this deed or affecting the validity or enforceability of that provision in any other jurisdiction.

15.10 Enforcement of indemnities

It is not necessary for a party to incur expense or make payment before enforcing a right of indemnity conferred by this deed.

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15.11 Survival

Any indemnity or obligation of confidentiality in this deed is independent and survives termination of this deed. Any other term which by its nature is intended to survive termination of this deed survives termination of this deed.

15.12 Attorneys

Each person who executed this deed on behalf of a party declares that he or she has no notice of the revocation or suspension by the grantor or in any other manner of the power of attorney under the authority of which he or she executes this deed.

15.13 Waiver

A party does not waive a right, power or remedy if it fails to exercise or delays in exercising the right, power or remedy. A single or partial exercise by a party of a right, power or remedy does not prevent another or further exercise of that or another right, power or remedy. A waiver of a right, power or remedy must be in writing and signed by the party giving the waiver.

15.14 Relationship

Except where this deed expressly states otherwise, this deed does not create a relationship of employment, trust, agency or partnership between the parties.

15.15 Remedies cumulative

The rights provided in this deed are cumulative with and not exclusive of the rights, powers or remedies provided by law independently of this deed.

15.16 Governing law

This deed will be governed by and construed in accordance with the law for the time being in force in New South Wales and the parties, by entering into this deed, are deemed to have submitted to the non-exclusive jurisdiction of the courts of that State.

15.17 Exercise of rights

A party may exercise a right, at its discretion and separately or concurrently with another right.

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Schedule 1 — Termination Entitlements

Entitlement

Entitlement to remuneration package up to 31 July 2009 including accruing of annual leave and long service leave to that date

Amount

Pro-rata entitlement to A$1,551,000 pa (constant through to 31 July 2009). Any outstanding amounts will be paid on the date of this deed or as otherwise agreed.

Salary agreed to be paid for the period 1 August 2009 — 31 October 2009

A$336,821. This amount will be paid on the date of this deed or as otherwise agreed.

STI for fiscal 2009

75% of Package — guaranteed ‘bridge’ proposal = A$1,163,000. This amount will be paid on the date of this deed or as otherwise agreed.

Redundancy payment in lieu of notice for 12 months

A$1,551,200. This amount will be paid on the date of this deed or as otherwise agreed.

Accrued holiday pay and long service leave

Annual leave entitlement at 31 October 2009 is A$575,000

Long service leave entitlement at 31 October 2009 is A$459,000

These amounts will be paid on the date of this deed or as otherwise agreed.

STI for fiscal 2010

Pro rata basis (ie up to and including 31 October 2009) on 75% of Package (A$1.551m equal to A$387,000), payable on the date of this deed or as otherwise agreed.

Tranche E of the Retention Incentive dated 31 October 2005

A$700,000. This amount will be paid on the date of this deed or as otherwise agreed.

Tranche 2 of the F2008 LTI Plan

Sims will pay the Executive A$1,273,000 in full satisfaction of the Executive’s expected entitlement to performance rights under Tranche 2 of the F2008 LTI Plan as outlined in the invitation letter of 25 September 2007. This amount will be paid on the date of this deed or as otherwise agreed.

Tranche 3 of the F2008 LTI Plan

Termination will qualify as a ‘Qualifying Cessation’ and the Executive’s unvested performance rights will not immediately lapse and will be retained and tested for satisfaction of vesting conditions at the end of the Performance Period. Sims must make available to the Executive any material, including any external advice obtained by Sims, relied upon when testing for satisfaction of vesting conditions.

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The Executive’s maximum entitlement as per the invitation letter of 25 September 2007 subject to the terms of the F2008 LTI Plan, is:

44,218 performance rights based on TSR hurdle F08-F10, 29,746 performance rights based on EPS hurdle F08-F10, and 29,746 performance rights based on SRS EBITDA F08-F10.

Directors may determine (prior to vesting) to pay the entitlement in cash if and when vested rather than issue shares. No retesting will be allowed.

Options — Tranches 1, 2 and 3 of the F2009 LTI Plan

The Termination will qualify as a ‘Qualifying Cessation’ and the Executive’s unvested options will not immediately lapse and will vest in accordance with the Vesting Schedule outlined in the invitation letter of 24 November 2008. Sims agrees that it will not exercise its discretion to satisfy the Executive’s vested options by way of cash payment and that any vested options may be exercised by the Executive up to 5.00pm on the Expiry date in accordance with the invitation letter of 24 November 2008.

The Executive’s maximum entitlement as per the invitation letter of 24 November 2008 subject to the terms of the F2009 LTI Plan, is:

45,145 options ex $13.11 vest 1 Sept 09, 45,145 options ex $13.11 vest 1 Sept 10, and 45,145 options ex $13.11 vest 1 Sept 11.

Performance rights under the F2009 LTI Plan

The Termination will qualify as a ‘Qualifying Cessation’ and the Executive’s unvested performance rights will not immediately lapse and will be retained and tested for satisfaction of vesting conditions at the end of the First Performance Period (as defined in the invitation letter of 24 November 2008). Sims must make available to the Executive any material, including any external advice obtained by Sims, relied upon when testing for satisfaction of vesting conditions.

The Executive’s maximum entitlement as per the invitation letter of 24 November 2008 subject to the terms of the F2009 LTI Plan, is:

44,440 performance rights based on TSR hurdle F09-F11

Directors may determine (prior to vesting) to pay the entitlement in cash if and when vested rather than issue shares.

No retesting will be allowed.

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Superannuation

Sims must make such contribution to the Sims Defined Benefit Plan as may be necessary to ensure that the Executive’s superannuation benefit under that Plan is equal to the benefit the Executive would have received if the Executive had remained in Sims’ employ until 31 October 2010 in accordance with the terms of the Second Contract. This payment, which the parties agree to be A$467,436, will be made on the date of this deed or as otherwise agreed.

On the date of this deed, Sims will request the trustee of the Sims Defined Benefit Plan to liaise with the Executive to ascertain from him how he wishes the amount due to be paid.

Subject to the terms of the indemnity given by the Executive in favour of Sims, Sims will ensure that Sims Metal Management Asia Limited remains the trustee of the Sutcliffe Superannuation Fund (established while the Executive was employed as the Chief Executive Officer of Simsmetal UK Holdings Ltd) until 31 October 2010.

Other Benefits

Sims agrees that the Executive may retain New South Wales motor vehicle registration number “AS 999”.

Sims will continue to provide motor vehicle insurance in respect of the Executive’s motor vehicles (Rego AXS 35B, AS999 and BHG 42A), in accordance with the terms and conditions pursuant to which such insurance was provided by Sims immediately prior to the Termination, until 31 October 2009.

Sims agrees that the Executive may purchase, at book value, the laptop, printer and blackberry used by the Executive immediately prior to the Termination, subject to deletion of all Sims’ confidential information from the hard drive.

Sims agrees to continue to provide IT support to the Executive until 31 October 2009. Sims agrees that the Executive may retain and use for personal purposes the Executive’s “@simsmm.com” email address until 31 October 2009.

Sims agrees that in the period 1 November 2009 until 31 October 2010, it will automatically forward personal emails addressed to the Executive at the Executive’s “@simsmm.com”, “@simsgroup” and “@au.sims-group.com” email addresses to the Executive at such email address as the Executive may nominate in writing from time to time and send an automatic reply to the sender of any such email advising the sender of the Executive’s nominated email address.

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Schedule 2 — Announcement

Sims Metal Management announced today that Executive Director, Mr Jeremy Sutcliffe is leaving the Company and stepping down from the Board.

Mr Sutcliffe is the former CEO of Sims Group Limited, which merged with North American based Metal Management, Inc in March 2008 to create Sims Metal Management Limited (SimsMM). As contemplated by the merger, Mr Dan Deinst, the former CEO and President of Metal Management, became the CEO of SimsMM initially with primary responsibility for North American operations, while Mr Sutcliffe continued to manage the remainder of SimsMM’s operations for a transitionary period. Due to the efforts of Messrs Dienst and Sutcliffe, the integration and transition of key operational responsibilities was completed successfully and ahead of schedule.

In acknowledging Mr Sutcliffe’s contribution during a career which spanned over 20 years, the Board noted that under his tenure as Group CEO from 2002 to 2008, the Company delivered a Total Shareholder Return of over 850%, the seventh highest performer of all the companies listed on the ASX100 over the period, and saw its market capitalisation grow more than twelve fold.

“We owe Jeremy a debt of gratitude for helping to bring together two already significant companies to form the world’s largest listed metal recycling company and to have achieved this with minimal reliance on debt,” said SimsMM Chairman Mr Paul Varello.

Mr Sutcliffe’s contract, which was due to run to 31 October 2010, has been terminated and a mutually agreed settlement on remaining payments and obligations reached.

Mr Sutcliffe is currently a non executive director of CSR Limited.

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Executed as a deed

Executed by Sims Metal Management Limited ) (ABN 69 114 838 630) in ) accordance with Section 127 of the ) Corporations Act 2001 (Cth)

Signature of authorised person

Director

Office held

Paul Varello

Name of authorised person (BLOCK LETTERS)

Signed, Sealed and Delivered by Jeremy Sutcliffe ) in the presence of: ) )

Signature of authorised person

Secretary Office held

Frank Moratti

Name of authorised person (BLOCK LETTERS) Jeremy Sutcliffe

Signature of Witness

Name of Witness (BLOCK LETTERS)

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EX-4.13 c53813exv4w13.htm EX-4.13

Exhibit 4.13

CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO CERTAIN PORTIONS OF THIS AGREEMENT. CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION.

Agreement Sims Metal Management Limited Multi-option facility agreement Commonwealth Bank of Australia Each Borrower specified in Schedule 1 adam.stapledon@freehills.com

[*] Confidential Treatment Requested

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Contents Table of contents The agreement 1 Operative part 2 Definitions and interpretation 2 1.1 Agreement components 2 1.2 Definitions 2 1.3 Incorporated definitions 13 1.4 Incorporated provisions 13 Conditions precedent 13 2.1 Conditions precedent to initial Funding Portion 13 2.2 Conditions precedent to all Funding Portions 14 2.3 Certified copies 15 2.4 Benefit of conditions precedent 15 Roll over of principal outstanding 15 Commitment, purpose and availability of Facility 17 4.1 Provision of Commitment 17 4.2 Purpose 17 4.3 Cancellation of Commitment during Availability Period 17 4.4 Cancellation at end of Availability Period 17 4.5 Review and renewal of Commitment 17 Funding and rate setting procedures 19 5.1 Delivery of Funding Notice 19 5.2 Requirements for a Funding Notice 19 5.3 Irrevocability of Funding Notice 20 5.4 Amount of Funding Portions 20 5.5 Selection of Funding Periods 20 5.6 Determination of Funding Rate 21 5.7 Market disruption 21 5.8 Confidentiality 22 5.9 Currency movements 22 5.10 Unavailability of a currency 23 Cash Advance Facility 23 6.1 Provision of Funding Portions 23 6.2 Number of Funding Portions 23 6.3 Consolidation and division of Funding Portions 23 6.4 Selection Notice 24 6.5 Repayment 24 6.6 Prepayment under Cash Advance Facility 24

1 Definitions and interpretation

2 Conditions precedent

3 Roll over of principal outstanding

4 Commitment, purpose and availability of Facility

5 Funding and rate setting procedures

6 Cash Advance Facility

Contents 1

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Contents 6.7 Prepayment date 25 6.8 Interest 25 6.9 Liquidity Bills 25 6.10 Fees 26 Commercial Bills Facility 26 7.1 Bill acceptance and endorsement procedure 26 7.2 Preparation of Bills 26 7.3 Failure to prepare Bills 26 7.4 Form of Bills 27 7.5 Restriction on use by the Lender 27 7.6 Tax on Bills 28 7.7 Signing of Bills and appointment of Lender as attorney 28 7.8 Notification of rate and discounting procedure 28 7.9 Bills accepted or endorsed but not discounted 29 7.10 Borrower’s primary liability to pay Bills 29 7.11 Indemnity in respect of Bills 29 7.12 Variation of procedures 29 7.13 Fees 29 7.14 Repayment by cash cover and netting 30 7.15 Acknowledgment regarding signed Bills 31 Credit Support Facility 31 8.1 Issue of Credit Support Documents 31 8.2 Additional Funding Notice requirements 31 8.3 Form of Credit Support Documents 31 8.4 Prepayment under Credit Support Facility 32 8.5 Prepayment date 32 8.6 Cash cover 32 33 8.8 Tax on Credit Support Documents 33 8.9 Liability of Borrowers 33 8.10 Early expiration or reduction 34 8.11 Beneficiary Contracts and notification 34 8.12 Obligations of the Lender 34 8.13 Indemnity in respect of Credit Support Document 35 8.14 Unconditional nature of Borrower’s obligations 35 Trade Finance Facility 36 9.1 Additional Funding Notice requirements 36 9.2 Provision of Advances 37 9.3 Application of Trade Advances 38 9.4 Repayment of Trade Advances 38 9.5 Interest on Advances 38 9.6 Issue of Documentary LCs 38 9.7 Form of Documentary LCs 38 9.8 Credit Support Document terms apply to Documentary LC 39 9.9 Foreign Bills Negotiation 39

7 Commercial Bills Facility

8 Credit Support Facility

9 Trade Finance Facility

	9.10 Interest on Proceeds of Negotiation	39
	9.11 Repayment of Proceeds of Negotiation	39
	9.12 Extension of repayment of Proceeds of Negotiation	39
	9.13 Fees	40
10	Overdraft Facility	40
	10.1 Overdraft Facility	40
	[*] Confidential Treatment Requested

Contents 2

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10.2 Funding Portions 10.3 Prepayment 10.4 Fees 11 Representations and warranties 11.1 Representations and warranties 11.2 Survival and repetition of representations and warranties 11.3 Reliance by Lender 12 Undertakings 12.1 Incorporated undertakings 12.2 Compliance 12.3 Term of undertakings 13 Events of Default 13.1 Events of Default 13.2 Effect of Event of Default 13.3 Application of cash cover under Commercial Bills Facility, Trade Finance Facility and Credit Support Facility 13.4 New Related Body Corporate 14 Fees 15 Interest on overdue amounts 15.1 Payment of interest 15.2 Accrual of interest 15.3 Rate of interest 16 Assignment and substitution 17 Additional Borrowers 17.1 Additional Borrowers 17.2 Repetition of Representations 18 General 18.1 Governing law and jurisdiction 18.2 Prohibition and enforceability 18.3 Waivers 18.4 Variation 18.5 Cumulative rights 18.6 Counterparts 18.7 Attorneys Schedules Borrowers

Contents

40 40 41 41 41 41 41 41 41 41 41 42 42 42 42 42 43 43 43 43 44 44 44 44 44 45 45 45 45 46 46 46 46 48

Key Terms Schedule		50
Fee Schedule		53
Funding Notices		56
Selection Notice		62
Renewal Notice		64
	[*] Confidential Treatment Requested
		Contents 3

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[*] Confidential Treatment Requested Roll over of existing Drawings Signing page Attachments Accession Deed — Additional Borrowers	Contents
	67 70

Contents 4

The agreement

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Multi-option facility agreement
Date�2 November 2009
Between the parties
Original Borrower	Each of the persons listed inSchedule 1
Lender	Commonwealth Bank of Australia
	ABN 48 123 123 124 of Level 21, Darling Park Tower 1, 201 Sussex Street, Sydney, New South Wales
	2000, Australia
Background	The Lender has agreed to provide the Facilities to the Borrowers on the terms of this agreement.
The parties agree	as set out in the Operative part of this agreement, in consideration of, among other things, the mutual
	promises contained in this agreement.

[*] Confidential Treatment Requested

page 1

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----- Start of picture text -----

Operative part
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• 1 Definitions and interpretation

• 1.1 Agreement components

• This agreement includes any schedule.

• 1.2 Definitions

• The meanings of the terms used in this document are set out below.

Term Accession Deed	Meaning
	an accession deed in the form of Attachment 1.

Additional Borrower a person which becomes an Additional Borrower in accordance with clause 17. Applicable Screen Rate in respect of a Funding Period and a Funding Portion denominated in:

• 1 A$, the average bid rate quoted on the page entitled ‘BBSY’ on the Reuters Monitor System or any Replacement Page at or about 10.10am (Sydney time) on the Rate Set Date for that Funding Portion;

• 2 US Dollars, the arithmetic mean of the rates quoted on the page entitled ‘LIBOR01’ on the Reuters Monitor System or any Replacement Page at or about 11.00am (London time) on the Rate Set Date for that Funding Portion for Euro deposits in US Dollars;

• 3 Sterling, the rate quoted on the page entitled ‘LIBOR01’ on the Reuters Monitor System or any Replacement Page at or about 11.00am (London time) on the Rate Set Date for that Funding Portion for deposits in Sterling;

• 4 Euro, the rate quoted on the page entitled ‘EURIBOR01’ on the Reuters Monitor System or any Replacement Page at or about 11.00am (Brussels time) on the Rate Set Date for that Funding Portion;

• 5 CAD, the rate quoted on the page entitled ‘LIBOR01’ on the Reuters Monitor System or any Replacement Page at or about 11.00am (Ottawa time) on the Rate Set Date for that Funding Portion for deposits in Sterling;

• 6 any other Available Currency, the rate agreed by the Lender at the time such currency is approved by the Lender,

in each case for a term equal to, or if not equal to most closely approximating, that Funding Period: if the rate is not displayed on any Rate Set Date for such a term, but rates are displayed for terms longer and shorter than that period, then the rate will be determined by the Lender by linear interpolation between the nearest longer and shorter terms.

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1 <Definitions and interpretation

Term Application for Irrevocable Documentary Credit Available Currency Availability Period Bank Guarantee Base Rate

Meaning

an application for irrevocable documentary credit in the form most recently notified to Sims by the Lender. A$, US Dollars, Sterling, CAD and Euro and any other currency approved by the Lender. in relation to a Facility, the period commencing on the date on which the conditions precedent set out in clause 2.1 are satisfied or waived by the Lender and ending on the earlier of: 1 the Termination Date (if any) for that Facility; 2 the date falling one month prior to the Final Termination Date; and 3 the date on which the Commitment is cancelled in full under this agreement. a guarantee issued by the Lender under the Credit Support Facility. on any Rate Set Date in respect of a Funding Period for a Funding Portion:

• 1 the Applicable Screen Rate for the Funding Period and the Funding Portion; or

• 2 if on the Rate Set Date for any reason the Applicable Screen Rate is not displayed or the basis on which the Applicable Screen Rate is displayed is changed and in the opinion of the Lender it ceases to reflect the Lender’s cost of funding to the same extent as at the date of this agreement, then the Base Rate will be the rate determined by the Lender to be the average of rates quoted to the Lender by 3 Reference Banks on the Rate Set Date for:

• in the case of a Funding Portion denominated in A$ the rate percent per annum determined by the Lender as the average of the rates quoted to the Lender by each Reference Bank for the purchase of Bills accepted by the Reference Bank which have a tenor equal to the Funding Period of the Funding Portion and a Face Value Amount equal to the amount of the Funding Portion; or

• in the case of a Funding Portion denominated in a Foreign Currency, the rate determined by the Lender based on the rates otherwise quoted by the Reference Banks (or so many of them as are prepared to quote such rates), on application by the Lender, for deposits in that currency for a term equal to the Funding Period of the Funding Portion commencing on that Funding Date in an amount equal to the amount of the Funding Portion; and

• 3 if, on the Rate Set Date, the Base Rate for a Funding Portion cannot be determined in accordance with paragraphs (1) or (2) of this definition, the Base Rate will be the Lender’s cost of funding the Funding Portion for the Funding Period.

All calculations of rates for the purposes of this definition will be expressed as a percent per annum.

Beneficiary

the beneficiary of a Credit Support Document or a Documentary LC.

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1 <Definitions and interpretation

Term Beneficiary Contract Bill Acceptance / Endorsement Fee Bill Acceptance / Endorsement Fee Rate Bill Discount Rate Bill Funding Borrower Break Costs

Meaning

each agreement between a Borrower and a Beneficiary where the Lender has issued a Credit Support Document or a Documentary LC in favour of the Beneficiary to support the obligations of the Borrower to the Beneficiary under that agreement. the fee payable to the Lender for accepting or endorsing Bills, calculated in accordance with clause 7.13(a). on any date, in respect of a Bill Funding, the % per annum under the heading “Bill Acceptance/Endorsement Fee Rate” corresponding to the most recent Gearing Ratio (as set out in the most recent Compliance Certificate provided by Sims), as specified in Part 2 of the Key Terms Schedule under the heading “Bill Acceptance/Endorsement Fee Rate”. at any date the rate of discount expressed as a per cent yield to maturity per annum at which the Lender is prepared at that date to purchase Bills accepted or endorsed by itself. any Funding Portion under the Commercial Bills Facility. each Original Borrower and each Additional Borrower. for any repayment or prepayment the amount (if any) by which:

• 4 the interest on the amount repaid or prepaid which the Lender should have received under this agreement (had the repayment or prepayment not occurred),

• exceeds:

• 5 the return which the Lender would be able to obtain by placing the amount repaid or prepaid to it on deposit with a Reference Bank nominated by it,

in each case for the period from the date of repayment or prepayment until the last day of the then current Funding Period applicable to the repaid or prepaid amount.

• Business Day 1 in relation to any Funding Portion or any other payment obligation, a day (excluding a Saturday, Sunday or public holiday) on which banking institutions are open for business:

  • in Sydney and Melbourne in relation to Dollars;

  • in New York City and Los Angeles in relation to US Dollars;

  • in London in relation to Sterling;

  • in Ottawa in relation to CAD;

  • in London in relation to Euro, provided that the relevant day is also a TARGET Day in relation to Euro; and

• 2 for all other purposes, a day on which banks are open for business in Sydney and Melbourne excluding a Saturday, Sunday or public holiday.

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1 <Definitions and interpretation

Term CAD Cash Advance Facility Cash Advance Facility Limit Commercial Bills Facility Commercial Bills Facility Limit Commitment Commitment Fee Rate Common Terms Deed Credit Support Document Credit Support Document Fee Rate Credit Support Facility Credit Support Facility Limit Current Bill

Meaning

the lawful currency of Canada. if specified as “Available” in Part 1 of the Key Terms Schedule, the cash advance facility made available by the Lender to the Borrowers under clause 6 and on the terms set out in Part 1 of the Key Terms Schedule. the “Facility Limit” in respect of the Cash Advance Facility (if any) as specified in Part 1 of the Key Terms Schedule, as adjusted under this agreement. if specified as “Available” in Part 2 of the Key Terms Schedule, the acceptance, discount and endorsement facility made available by the Lender to the Borrowers under clause 7 and on the terms set out in Part 2 of the Key Terms Schedule. the “Facility Limit” in respect of the Commercial Bills Facility (if any) as specified in Part 2 of the Key Terms Schedule, as adjusted under this agreement. the amount specified as such in Part 6 of the Key Terms Schedule. the “Commitment Fee Rate” specified in Part 6 of the Key Terms Schedule. the deed entitled ‘Common Terms Deed’ dated on or about the date of this agreement between, amongst others, the Lender and the Borrowers. 1 each Bank Guarantee; and 2 each Standby LC, which is issued under the Credit Support Facility. for a Credit Support Document issued under the Credit Support Facility, the % per annum under the heading “Credit Support Document Fee Rate” corresponding to the most recent Gearing Ratio (as set out in the most recent Compliance Certificate provided by Sims), specified in Part 3 of the Key Terms Schedule. if specified as “Available” in Part 3 of the Key Terms Schedule, the credit support document facility made available by the Lender to the Borrowers under clause 8 and on the terms set out in Part 3 of the Key Terms Schedule. the “Facility Limit” in respect of the Credit Support Facility (if any) as specified in Part 3 of the Key Terms Schedule, as adjusted under this agreement. any Bill drawn under the Commercial Bills Facility which has not been

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1 <Definitions and interpretation

Term Meaning

discharged in full or in respect of which the obligations of the relevant Borrower or the Lender under this agreement have not been satisfied.

Current Credit Support Document

each Credit Support Document which has not been discharged in full or in respect of which a Borrower’s obligations under this agreement have not been satisfied.

Current Documentary LC

each Documentary LC which has not been discharged in full or in respect of which a Borrower’s obligations under this agreement have not been satisfied.

Current Dollar Amount

at any time:

• 1 for a Funding Portion under the Cash Advance Facility or Overdraft Facility, or for a Trade Advance or Proceeds of Negotiation denominated in:

• Dollars, the principal amount of that Funding Portion outstanding at that time;

• a Foreign Currency, the Dollar Equivalent at that time of the principal amount of that Funding Portion outstanding at that time;

• 2 for a Credit Support Document under the Credit Support Facility denominated in:

• Dollars, its Face Value Amount at that time;

• a Foreign Currency, the Dollar Equivalent at that time of its Face Value Amount at that time; and

• 3 for a Documentary LC under the Trade Finance Facility denominated in:

• Dollars, its Face Value Amount at that time;

• a Foreign Currency, the Dollar Equivalent at that time of its Face Value Amount at that time.

• 4 for a Bill under the Commercial Bills Facility denominated in Dollars, its Face Value Amount at that time.

Discount Amount

in respect of a Bill discounted by the Lender, the Dollar amount derived by application of the following formula

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where:

FVA equals the Face Value Amount of the Bill;

R equals the Bill Discount Rate on the Funding Date on which the Bill is discounted (expressed as a number eg 10.74% is expressed as 10.74); and

D equals the number of days in the Funding Period for the Bill.

Documentary LC a documentary letter of credit issued by the Lender under the Trade Finance Facility.

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1 <Definitions and interpretation

Term Documentary LC Fee Rate Dollar Equivalent Euro Event of Default Exchange Rate Exchange Rate Calculation Date Existing Multi-Option Facility Agreement Expiry Date Extension Fee Rate Face Value Amount

Meaning

for a Documentary LC issued under the Trade Finance Facility, the “Documentary LC Fee Rate” specified in Part 4 of the Key Terms Schedule. in relation to an amount expressed in a Foreign Currency at any time, the amount of Dollars determined by translating that amount of Foreign Currency into Dollars at the Exchange Rate for that Foreign Currency at that time. the single currency unit of each Participating Member State. any event specified in clause 13.1. in relation to any Foreign Currency, the spot rate of exchange determined by the Lender to be the rate of exchange to buy that Foreign Currency with Dollars. the last Business Day of each month. the multi-option facility agreement between, amongst others, Sims and the Lender dated 29 October 1991. in relation to a Credit Support Document or a Documentary LC, the expiry date for that Credit Support Document of Documentary LC as specified in that Credit Support Document or Documentary LC (as applicable). the “Extension Fee Rate” specified in Part 6 of the Key Terms Schedule. at any time:

• 1 in relation to a Credit Support Document, the amount stated in, or determined in accordance with, the Credit Support Document as the maximum amount payable under it at that time;

• 2 in relation to a Documentary LC, the amount stated in, or determined in accordance with, the Documentary LC as the maximum amount payable under it at that time; and

• 3 in relation to a Bill, the amount stated on the Bill as the maximum amount payable under the Bill.

• Facility 1 the Cash Advance Facility;

• 2 the Commercial Bills Facility;

• 3 the Credit Support Facility;

• 4 the Trade Finance Facility; or

• 5 the Overdraft Facility.

  • [*] Confidential Treatment Requested

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1 <Definitions and interpretation

Term Facility Limit Fee Letter Fee Schedule Final Termination Date Finance Contract Financial Close Foreign Bill Foreign Currency Funding Date Funding Notice Funding Period Funding Portion Funding Rate

Meaning

1 in respect of the Cash Advance Facility, the Cash Advance Facility Limit; 2 in respect of the Commercial Bills Facility, the Commercial Bills Facility Limit; 3 in respect of the Credit Support Facility, the Credit Support Facility Limit; 4 in respect of the Trade Finance Facility, the Trade Finance Facility Limit; and 5 in respect of the Overdraft Facility, the Overdraft Facility Limit. each fee letter between the Lender and Sims in respect of an extension fee payable in accordance with clause 14(b). the schedule of fees and charges set out in Schedule 3. the date specified as such in Part 6 of the Key Terms Schedule as extended from time to time in accordance with clause 4.5. any written contract or arrangement between a Borrower under the Credit Support Facility, or a Borrower of a Documentary LC under the Trade Finance Facility, and a Beneficiary which requires the Borrower to pay or repay to any person any amount due in respect of financial accommodation. the date on which all of the conditions set out in clause 2.1 are first satisfied or waived by the Lender. a negotiable instrument (whether clean or documentary) where the party named as drawee is not a resident of Australia, which is in a form satisfactory to the Lender. US Dollars, Sterling, CAD and Euro and any other foreign currency which is freely transferable and convertible into Dollars. the date on which a Funding Portion is provided, or is to be provided, to or for the account of a Borrower under this agreement. a notice given under clause 5.1. for a Funding Portion, a period selected or determined under clause 5.5. each portion of the Commitment provided under this agreement. in respect of a Funding Period for a Funding Portion under the Cash Advance Facility or provided as a Trade Advance under the Trade Finance Facility, the aggregate of:

[*] Confidential Treatment Requested

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1 <Definitions and interpretation

Term Meaning

• the Base Rate on the Rate Set Date for that Funding Period; and

• the Margin.

Gearing Ratio for a Calculation Period, the ratio of Financial Indebtedness to EBITDA. Group Guarantee the deed so entitled dated 21 March 1996 between, amongst others, the Lender and Sims. Group Limit Facility the group limit overdraft facility dated on or about the date of this agreement between, amongst others, the Lender and Sims.

Interest Payment Date the last day of each Funding Period. Key Terms Schedule

the Key Terms Schedule set out in Schedule 2 as amended, supplemented or replaced from time to time in accordance with this agreement.

• Lending Office 1 the Sydney Lending Office;

• 2 the office of the Lender at Senator House, 85 Queen Victoria Street London EC4V4HA, England;

• 3 the office of the Lender at Level 17, 599 Lexington Avenue New York 10022, USA; or

• 4 any other office notified by the Lender under this agreement.

• Liquidity Bill a Bill drawn under clause 6.9. Margin 1 on any date in respect of a Funding Portion under the Cash Advance Facility, an amount payable under clause 15 or [*], the % per annum specified in Part 1 of the Key Terms Schedule under the heading “Margin” which corresponds to the most recent Gearing Ratio (as set out in the most recent Compliance Certificate provided by Sims); and

• 2 in respect of a Funding Portion provided as a Trade Advance under the Trade Finance Facility, the % per annum specified in Part 4 of the Key Terms Schedule under the heading “Margin” which corresponds to the most recent Gearing Ratio (as set out in the most recent Compliance Certificate provided by Sims).

Negative Pledge Agreement the deed entitled ‘Negative Pledge’ dated 29 October 1991 between, amongst others, the Lender, Sims and the companies named in Schedule 1 of that deed. Net Bill Proceeds in respect of a Bill discounted by the Lender under the Commercial Bills Facility, the amount to be provided by the Lender in respect of that Bill in accordance with clause 7.8.

[*] Confidential Treatment Requested

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1 <Definitions and interpretation

Term

Obligation

Meaning any obligation to make payment in respect of an underlying trade transaction, either pre or postshipment.

• Original Dollar Amount 1 for a Funding Portion under the Cash Advance Facility or Overdraft Facility or for a Trade Advance or Proceeds of Negotiation under the Trade Finance Facility denominated in:

  • Dollars, the Dollar amount of that Funding Portion;

  • a Foreign Currency, the Dollar Equivalent of that Funding Portion calculated at the Exchange Rate for that Foreign Currency on the Funding Date for that Funding Portion; and

• 2 for a Credit Support Document under the Credit Support Facility or a Documentary LC under the Trade Finance Facility denominated in:

  • Dollars, its Face Value Amount on its Funding Date;

  • a Foreign Currency, the Dollar Equivalent of its Face Value Amount calculated on the Funding Date for that Credit Support Document; and

• 3 for a Bill under the Commercial Bills Facility, its Face Value Amount on its Funding Date.

• Outstanding Current Bill Amount in respect of a Bill Funding and in relation to any Funding Date, the aggregate Face Value Amount of all Current Bills under the Commercial Bills Facility which mature on or before that Funding Date and which have not been paid by a Borrower or in respect of which the obligations of a Borrower under clauses 7.10, 7.11, 7.14(a) and 7.14(b) remain unsatisfied.

Overdraft Account each account of an Overdraft Borrower held with the Lender. Overdraft Borrower each “Overdraft Borrower” specified in Part 5 of the Key Terms Schedule. Overdraft Facility if specified as “Available” in Part 5 of the Key Terms Schedule, the overdraft facility made available by the Lender to the Overdraft Borrowers under clause 10 and on the terms set out in Part 5 of the Key Terms Schedule and the Group Limit Facility. Overdraft Facility Limit the “Cap Limit” as defined in the Group Limit Facility. Overdue Margin the “Overdue Margin” specified in Part 6 of the Key Terms Schedule. Overdue Rate [*] Participating Member State any member state of the European Union that adopts or has adopted Euro as its lawful currency in accordance with legislation of the European Union relating to the European Monetary Union.

[*] Confidential Treatment Requested

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1 <Definitions and interpretation

Term Payment Documents Principal Outstanding Proceeds of Negotiation Rate Set Date Relevant Credit Support Documents Relevant Currency Relevant Interbank Market Renewal Notice Selection Notice

Meaning

the documents against which the Lender is required to make payment under any Documentary LC. at any time, the aggregate Current Dollar Amount of all outstanding Funding Portions. in respect of the Trade Finance Facility, a Funding Portion, being the proceeds of negotiation of a Foreign Bill, that is provided in Same Day Funds in an Available Currency as specified in the relevant Funding Notice. in respect of a Funding Period for a Funding Portion: 1 denominated in Dollars, the[*]of that Funding Period; and 2 denominated in US Dollars,[*]of that Funding Period; 3 denominated in Euro,[*]of that period; 4 denominated in CAD,[*]of that Funding Period; and 5 denominated in Sterling, the[*]of that Funding Period. 1 each Transaction Document; 2 each Credit Support Document; 3 each Documentary LC; and 4 each Beneficiary Contract. the currency in which a payment is required to be made under the Transaction Documents and is: 1 for any Funding Portion or other payment obligation denominated in Dollars, Dollars; 2 for any Funding Portion or other payment obligation denominated in a Foreign Currency, that Foreign Currency; and 3 in any other case, if not expressly stated to be another currency, Dollars. 1 in relation to A$, the Australian bank bill market; 2 in relation to US Dollars, CAD or Sterling, the London interbank market; and 3 in relation to Euro, the interbank market for Euro operating in Participating Member States. a renewal notice substantially in the form set out in Schedule 6. a notice given under clause 6.4.

[*] Confidential Treatment Requested

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1 <Definitions and interpretation

Meaningeaningningg

Term Meaningeaningningg Standby LC a standby letter of credit issued by the Lender under the Credit Support Facility. Sterling the lawful currency of the United Kingdom. Sydney Lending Office the office of the Lender set out on page 1 of this agreement. TARGET Trans-European Automated Real-time Gross Settlement Express Transfer payment system. TARGET Day a day on which TARGET is open for settlement of payments in Euro. Termination Date in relation to:

• 1 the Cash Advance Facility, the “Termination Date” in respect of the Cash Advance Facility (if any) as specified in Part 1 of the Key Terms Schedule;

• 2 the Commercial Bills Facility, the “Termination Date” in respect of the Commercial Bills Facility (if any) as specified in Part 2 of the Key Terms Schedule;

• 3 the Credit Support Facility, the “Termination Date” in respect of the Credit Support Facility (if any) as specified in Part 3 of the Key Terms Schedule;

• 4 the Trade Finance Facility, the “Termination Date” in respect of the Trade Finance Facility (if any) as specified in Part 4 of the Key Terms Schedule;

• 5 the Overdraft Facility, the “Termination Date” in respect of the Overdraft Facility (if any) as specified in Part 5 of the Key Terms Schedule,

or in each case any later date agreed to by the Borrowers and the Lender.

in respect of the Trade Finance Facility, a Funding Portion that is provided in Same Day Funds in an Available Currency as specified in the relevant Funding Notice.

Trade Advance in respect of the Trade Finance Facility, a Funding Portion that is provided in Same Day Funds in an Available Currency as specified in the relevant Funding Notice. Trade Advance Request a request for a Trade Advance in the form most recently notified to Sims by the Lender. Trade Finance Facility if specified as “Available” in Part 4 of the Key Terms Schedule, the trade finance facility made available by the Lender to the Borrowers under clause 9 and on the terms set out in Part 4 of the Key Terms Schedule. Trade Finance Facility Limit the “Facility Limit” in respect of the Trade Finance Facility (if any) as specified in Part 4 of the Key Terms Schedule, as adjusted under this agreement. Transaction Document 1 this agreement;

• 2 each Fee Letter;

[*] Confidential Treatment Requested

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2 Conditions precedent

Term

Meaning

• 3 the Common Terms Deed;

• 4 the Group Limit Facility;

• 5 each Renewal Notice and Key Terms Schedule;

• 6 each “Transaction Document” of the Lender, as defined in the Common Terms Deed;

• 7 any other document designated as such by the Borrowers and the Lender,

or any document or agreement entered into or given under any of the above.

Undrawn Commitment at any time, the Commitment less the Principal Outstanding. US Dollars the lawful currency of the United States of America. USD Prime Rate the rate described as the Lender’s ‘USD Prime Rate’, as published from time to time or, if there is no such rate at any time, any substitute or replacement reference rate published by the Lender from time to time.

1.3 Incorporated definitions

• A word or phrase, other than one defined in clause 1.2, defined in the Common Terms Deed has the same meaning when used in this agreement.

1.4 Incorporated provisions

Clauses 1.3 to 1.6 (inclusive), 9, 15.2 and 16 of the Common Terms Deed apply to this agreement as if set out in full in this agreement and as if references in those clauses to ‘this deed’ were to ‘this agreement’.

• 2 Conditions precedent

2.1 Conditions precedent to initial Funding Portion

The Lender is not obliged to provide the Commitment or the first Funding Portion until the Lender has received all of the following in form and of substance satisfactory to the Lender:

• (a) Verification certificate : a verification certificate in the form of Schedule 2 of the Common Terms Deed given in respect of each Transaction Party and dated no more than 5 days before the date of this agreement;

[*] Confidential Treatment Requested

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2 Conditions precedent

• (b) Transaction Documents : originals of each Transaction Document which can be executed before the first Funding Date, duly executed by all parties to them other than the Lender and, where applicable:

• (1) duly stamped or, if not duly stamped, evidence satisfactory to the Lender that they will be duly stamped; and

• (2) in registrable form together with all executed documents necessary to register them;

• (c) enquiries : results of searches, enquiries and requisitions in respect of each Transaction Party;

• (d) opinions : an opinion from:

• (1) Freehills in respect of each Transaction Party incorporated in Australia, this agreement and the Common Terms Deed;

• (2) counsel for the Borrowers in respect of each Transaction Party incorporated outside of Australia;

• (e) Overdraft account authorities : signed account authorities, signature cards and any other documents required by the Lender with respect to the Overdraft Accounts;

• (f) KYC & AML : each document or other information necessary in the Lender’s opinion to enable the Lender to do any know your customer checks or anti-money laundering checks;

• (g) structure diagram : a complete diagram showing the structure and ownership arrangements of the Sims Group; and

• (h) US solvency certificate : with respect to each Transaction Party incorporated or organised under the laws of a state of the United States of America only, a certificate signed by an officer of that Transaction Party stating that it is solvent and able to pay its debts as and when they fall due.

2.2 Conditions precedent to all Funding Portions

The Lender is not obliged to provide any Funding Portion under a Facility until the following conditions are fulfilled to the Lender’s satisfaction:

• (a) Funding Notice : the Borrower has delivered a Funding Notice to the Lender requesting the Funding Portion;

• (b) Funding Date : the Funding Date for the Funding Portion is a Business Day within the Availability Period for the Facility;

• (c) Commitment : the Commitment is not, and will not be, exceeded by the provision of that Funding Portion when the Original Dollar Amount of that proposed Funding Portion is added to the Current Dollar Amount of all other outstanding Funding Portions;

• (d) Facility Limit : the Facility Limit for the Facility is not, and will not be, exceeded by the provision of that Funding Portion when the Original Dollar Amount of that proposed Funding Portion is added to the Current Dollar Amount of all other outstanding Funding Portions under that Facility;

[*] Confidential Treatment Requested

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3 Roll over of principal outstanding

• (e) Group Limit : in respect of a Funding Portion under the Overdraft Facility, the “Group Limit” (as defined in the Group Limit Facility) is not, and will not be, exceeded by the provision of that Funding Portion;

• (f) no Default : no Default has occurred which is continuing and no Default will result from the Funding Portion being provided;

• (g) Beneficiary Contract : in relation to a Funding Portion under the Credit Support Facility or to be provided as a Documentary LC under the Trade Finance Facility, the Borrower has provided the Lender with any information that the Lender reasonably requires in relation to each Beneficiary Contract to which the requested Funding Portion relates, and the terms and conditions of that Beneficiary Contract are reasonably satisfactory to the Lender;

• (h) Dollars : in respect of a Funding Portion under the Commercial Bills Facility, the Funding Portion is denominated in Dollars; and

• (i) Available Currency : in respect of a Funding Portion to be denominated in a Foreign Currency other than an Available Currency, the Lender (in its absolute discretion) has given its prior consent in writing to providing the Funding Portion in the requested Foreign Currency.

2.3 Certified copies

If requested by the Lender, an Officer of the relevant Transaction Party must certify a copy of a document given to the Lender under clauses 2.1 or 2.2 to be a true copy of the original document.

2.4 Benefit of conditions precedent

A condition in this clause 2 is for the benefit only of the Lender and only the Lender may waive it.

• 3 Roll over of principal outstanding

The parties agree that on and from Financial Close:

• (a) each Drawing (as defined in the Existing Multi-Option Facility Agreement) which is outstanding under the Existing Multi-Option Facility Agreement immediately prior to Financial Close:

• (1) under the ‘AUD Overdraft Facility’ (as described in the appendix headed ‘AUD Overdraft Facility Appendix’ in the Existing Multi-Option Facility Agreement) is deemed to be a Funding Portion under the Overdraft Facility; and

• (2) under the ‘Foreign Currency Facility’ (as described in the appendix headed ‘Foreign Currency Facility Appendix’ in the Existing Multi-Option Facility Agreement) is deemed to be a Funding Portion under the Cash Advance Facility,

in the same currency and for the same principal amount as the relevant Drawing and, where applicable, with a Funding Period equivalent to the Interest Period (as defined in the Existing Multi-Option Facility Agreement) for the Drawing.

[*] Confidential Treatment Requested

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4 Commitment, purpose and availability of Facility

Where the relevant Drawing was denominated in a Foreign Currency, the Dollar Equivalent of the Funding Portion shall be deemed to be equal to the AUD Equivalent (as defined in the Existing Multi-Option Facility Agreement) of the principal amount of the Drawing immediately prior to Financial Close;

• (b) each outstanding standby letter of credit or bank guarantee issued on behalf of a Sims Group company under the Existing MultiOption Facility Agreement prior to Financial Close is deemed to be a Funding Portion provided under the Credit Support Facility;

• (c) each outstanding documentary letter of credit issued on behalf of a Sims Group company under the Existing Multi-Option Facility Agreement prior to Financial Close is deemed to be a Funding Portion provided under the Trade Finance Facility;

• (d) without limiting clauses 3(b) and 3(c), each Drawing (as defined in the Existing Multi-Option Facility Agreement) described in columns 1 to 3 of Schedule 7 which is outstanding under the Existing Multi-Option Facility Agreement immediately prior to Financial Close is deemed to be a Funding Portion under the relevant Facility specified in column 4 of Schedule 7 for that Drawing in the same currency, with a Face Value Amount equal to the principal amount specified in Schedule 7 and, where the Drawing was denominated in a Foreign Currency, the Dollar Equivalent of the Face Value Amount shall be deemed to be equal to the AUD Equivalent (as defined in the Existing Multi-Option Facility Agreement) of the face value amount of the Drawing immediately prior to Financial Close;

• (e) any amount drawn by an Overdraft Borrower under the USD denominated bank account held with the Lender with account number 100601904USD115601 is deemed to be a Funding Portion under the Overdraft Facility;

• (f) all other amounts payable by a Borrower or a Guarantor (each as defined in the Existing Multi-Option Facility Agreement) to the Lender under or in connection with the Existing Multi-Option Facility Agreement, the Negative Pledge or the Group Guarantee that have accrued but not been paid up to the date of Financial Close are deemed to be payable under and in accordance with the terms of this agreement;

• (g) each of the Existing Multi-Option Facility Agreement, the Negative Pledge Agreement and the Group Guarantee is terminated and discharged in accordance with its terms;

• (h) the Borrowers and the Guarantors remain bound by any liabilities under the Existing Multi-Option Facility Agreement or Group Guarantee which have accrued but have not been performed up to the date of Financial Close, except as expressly contemplated by this deed; and

• (i) the Lender’s commitment to provide financial accommodation under the Existing Multi-Option Facility Agreement is cancelled.

[*] Confidential Treatment Requested

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• 4 Commitment, purpose and availability of Facility

• 4 Commitment, purpose and availability of Facility

4.1 Provision of Commitment

The Lender must make the Commitment available to the Borrower on the terms of this agreement.

4.2 Purpose

• A Borrower must use the net proceeds of a Funding Portion:

• (a) under:

  • (1) the Cash Advance Facility, only for the “Purpose” specified in Part 1 of the Key Terms Schedule;

  • (2) the Commercial Bills Facility, only for the “Purpose” specified in Part 2 of the Key Terms Schedule;

  • (3) the Credit Support Facility, only for the “Purpose” specified in Part 3 of the Key Terms Schedule;

  • (4) the Trade Finance Facility, only for the “Purpose” specified in Part 4 of the Key Terms Schedule;

  • (5) the Overdraft Facility, only for the “Purpose” specified in Part 5 of the Key Terms Schedule; or

• (b) in each case, for any other purpose that the Lender approves.

• 4.3 Cancellation of Commitment during Availability Period

• (a) A Borrower may cancel any of the Undrawn Commitment by giving the Lender [*] notice.

• (b) A partial cancellation of the Undrawn Commitment may only be made [*].

• (c) A notice given under clause 4.3(a) is irrevocable.

• 4.4 Cancellation at end of Availability Period

• On the date falling one month prior to the Final Termination Date, the Commitment is cancelled to the extent of the Undrawn Commitment.

4.5 Review and renewal of Commitment

• (a) On or before the date falling 12 months prior to the then Final Termination Date ( Existing Termination Date ), the Lender may review its participation under this agreement. Following this review the Lender, at its absolute discretion, may offer to extend its participation under the Facility Agreement to a date falling 12 months after the Existing Termination Date ( New Termination Date ) by

[*] Confidential Treatment Requested

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4 Commitment, purpose and availability of Facility

delivering to Sims a signed Renewal Notice attaching a proposed Key Terms Schedule and/or specifying a revised ‘Margin’ (as defined in the Group Limit Facility) for the Overdraft Facility.

• (b) The Lender’s offer contained in any Renewal Notice delivered in accordance with clause 4.5(a) may be subject to any conditions precedent or subsequent as the Lender specifies in its absolute discretion.

• (c) If, within 30 days of receiving a Renewal Notice delivered in accordance with clause 4.5(a):

• (1) the Borrowers have signed and delivered to the Lender the Renewal Notice; and

• (2) the Lender has notified Sims that it is satisfied in its absolute discretion that all of the conditions specified in the Renewal Notice have been satisfied,

the definition of “Final Termination Date” contained in clause 1.2 of this agreement shall be amended to be the New Termination Date and the Key Terms Schedule and ‘Margin’ (as defined in the Group Limit Facility) amended in accordance with the Renewal Notice with effect on and from the date of the Renewal Notice.

• (d) If:

• (1) the Lender does not deliver a Renewal Notice to the Borrowers;

• (2) the Borrowers do not satisfy any condition in the relevant Renewal Notice; or

• (3) the Borrowers do not sign and return a Renewal Notice delivered in accordance with clause 4.5(a) within 30 days of having received it,

• the Final Termination Date will not be amended.

• (e) Clause 14.2 of the Common Terms Deed is incorporated here by reference as if each reference therein to “this deed” were a reference to this agreement.

• (f) Nothing in the Transaction Documents obliges the Lender:

• (1) to extend any Final Termination Date; or

• (2) to provide a Renewal Notice.

• (g) Each Borrower acknowledges and agrees that the delivery or acceptance of any Renewal Notice or any amendment to a Transaction Document pursuant to this clause 4.5 or a Renewal Notice does not:

• (1) affect the validity or enforceability of this agreement or any other Transaction Document;

• (2) prejudice or adversely affect any right, power, authority, discretion or remedy arising under this agreement or any other Transaction Document before the date of any amendment under clause 4.5(c); or

[*] Confidential Treatment Requested

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5 Funding and rate setting procedures

  - (3) discharge, release or otherwise affect any liability or obligation arising under this agreement or any other Transaction Document before the date of any amendment under clause 4.5(c).

• 5 Funding and rate setting procedures

• 5.1 Delivery of Funding Notice

• (a) If a Borrower requires the provision of a Funding Portion under a Facility it must deliver to the Lender a Funding Notice.

• (b) Clause 5.1(a) does not apply in respect of the provision of a Funding Portion:

  • (1) under the Overdraft Facility; or

  • (2) to be provided as a Trade Advance or a Documentary LC under the Trade Finance Facility, in respect of which the Lender has received a Trade Advance Request no later than 10.00am local time (in the city of the applicable Lending Office) 2 Business Days before the proposed Funding Date.

• (c) Sims may at any time on a Business Day and within normal working hours, request that the Lender confirm whether it has determined that a Market Disruption Event has occurred and is continuing at that time. Without prejudice to the rights of the Lender under clause 5.7, the Lender shall promptly on receipt of any such request notify Sims whether at the time such notice is given it has determined that a Market Disruption Event has occurred.

• 5.2 Requirements for a Funding Notice

A Funding Notice to be effective must be:

• (a) in writing in the form of, and specifying the matters required in:

• (1) Part A of Schedule 4, in respect of the Cash Advance Facility or in respect of a Funding Portion to be provided as a Trade Advance under the Trade Finance Facility;

• (2) Part B of Schedule 4, in respect of the Commercial Bills Facility; and

• (3) Part C of Schedule 4 in respect of the Credit Support Facility or a Funding Portion to be provided as a Documentary LC under the Trade Finance Facility;

• (b) be received by the Lender before 11.00am on a Business Day at least 2 Business Days before the proposed Funding Date in respect of Funding Portions to be provided in Dollars or on a Business Day at least 3 Business Days before the proposed Funding Date in respect of Funding Portions to be provided in a Foreign Currency (or any shorter period that the Lender agrees in writing); and

[*] Confidential Treatment Requested

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5 Funding and rate setting procedures

• (c) if a Funding Portion is to be provided in a Foreign Currency on the relevant Funding Date, specify the Original Dollar Amount of the Funding Portion and the Foreign Currency in which it is required.

5.3 Irrevocability of Funding Notice

The Borrower of a Funding Portion is irrevocably committed to draw Funding Portions from the Lender in accordance with each Funding Notice given to the Lender.

5.4 Amount of Funding Portions

Each Borrower must ensure that the amount of each Funding Portion under the Cash Advance Facility or Commercial Bills Facility is:

• (a) if denominated in Dollars, [*] ;

• (b) if denominated in a Foreign Currency, [*] ; or

• (c) equal to the Undrawn Commitment.

5.5 Selection of Funding Periods

• (a) A Borrower of any Funding Portion under the Cash Advance Facility, Commercial Bills Facility or a Funding Portion to be provided as a Trade Advance or as Proceeds of Negotiation under the Trade Finance Facility must select the initial Funding Period which is to apply to the Funding Portion in the Funding Notice delivered for that Funding Portion.

• (b) A Borrower of a Funding Portion under the Cash Advance Facility may select a subsequent Funding Period which is to apply to the Funding Portion in a Selection Notice delivered for that Funding Portion.

• (c) Each Funding Period:

• (1) under the Cash Advance Facility must be [*] or any other period that the Lender agrees with the Borrower;

• (2) under the Commercial Bills Facility must be [*] ;

• (3) for a Trade Advance must be [*] ; and

• (4) for Proceeds of Negotiation must be [*] .

• (d) If a Funding Period ends on a day which is not a Business Day, it is regarded as ending on the next Business Day in the same calendar month or, if none, the preceding Business Day.

• (e) A Funding Period for a Funding Portion commences either on the first Funding Date for that Funding Portion or on the last day of the immediately preceding Funding Period for that Funding Portion.

• (f) No Funding Period may end after the Termination Date for a Facility (if any) or the Final Termination Date.

• (g) If a Borrower:

[*] Confidential Treatment Requested

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5 Funding and rate setting procedures

  - (1) fails to select a Funding Period for a Funding Portion under clause 5.5(a) or clause 5.5(b); or

  - (2) selects a Funding Period in a manner which does not comply with this clause 5.5,

  - then that Funding Period will be 1 month or such other period as the Lender selects.

• 5.6 Determination of Funding Rate

• (a) The Lender must notify Sims of the Funding Rate for a Funding Period for a Funding Portion as soon as reasonably practicable, and in any event [*] , after it has made its determination of the applicable Base Rate.

• (b) Each determination of the Base Rate by the Lender is sufficient evidence of that rate against the Borrowers unless the contrary is proved.

5.7 Market disruption

• (a) If the Lender determines that a Market Disruption Event occurs in relation to a Funding Portion for any Funding Period, then it shall promptly notify Sims, and the Base Rate for the Funding Period shall be the rate notified to Sims by the Lender as soon as practicable and in any event before interest is due to be paid in respect of that Funding Period, to be that which expresses as a percentage rate per annum the cost to the Lender of funding that Funding Portion from whatever source or sources it may reasonably select.

• (b) The Lender shall determine the rate notified by it under clause 5.7(a) in good faith. The rate so notified and any notification under clause 5.7(c) will be conclusive and binding on the parties in the absence of manifest error.

• (c) In this agreement “Market Disruption Event” means:

• (1) at or about noon on the Rate Set Date for the relevant Funding Period the Applicable Screen Rate is not available and none or only one of the Reference Banks supplies a rate to the Lender to determine the Base Rate for the relevant currency and period; or

• (2) in relation to a Funding Portion for which the Base Rate was to have been LIBOR or EURIBOR, before 5pm (London time) on the Business Day after the Rate Set Date for the relevant Funding Period, the Lender is satisfied that as a result of circumstances affecting the market generally:

  • (A) the cost to it on the Rate Set Date of obtaining matching deposits in the Relevant Interbank Market expressed as a rate percent per annum is or would be in excess of LIBOR or, if applicable, EURIBOR; or

  • (B) it is unable to obtain matching deposits in the Relevant Interbank Market, or

• (3) in relation to a Funding Portion for which the Base Rate was to have been BBSY, before 5pm (Sydney time) on the Business Day after the Rate Set Date for the relevant Funding Period, the Lender is satisfied

[*] Confidential Treatment Requested

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5 Funding and rate setting procedures

• that as a result of circumstances affecting the market generally the cost to it of funding its participation in the Funding Portion exceeds BBSY.

5.8 Confidentiality

• (a) Each of the Lender and the Borrowers shall keep confidential and not disclose to any other person, any information relating to the Lender provided under clause 5.7.

• (b) However, the Lender, the Borrowers, or their officers or employees may disclose such information:

• (1) to the extent required by any applicable law or regulation; or

• (2) to the extent it reasonably deems necessary in connection with any actual or contemplated proceedings or a claim with respect to clauses 5.7 or 5.8.

5.9 Currency movements

• (a) On or following each Exchange Rate Calculation Date the Lender may calculate the Current Dollar Amount as at the Exchange Rate Calculation Date of each outstanding Funding Portion and notify Sims of any amount required to be paid by it to the Lender under clause 5.9(b).

• (b) If, at an Exchange Rate Calculation Date, the aggregate Current Dollar Amount of each outstanding Funding Portion is greater than 105% of the Commitment, the Borrowers must, upon Sims receiving notice from the Lender under clause 5.9(a), pay to the Lender within 2 Business Days the amount of the difference.

• (c) All payments made under clause 5.9(b) must be deposited in an account:

• (1) with the Lender;

• (2) on which interest will accrue (and form part of the deposit on payment) at the usual 30 day deposit rate of the Lender for that type of account; and

• (3) are only available to the Borrower in accordance with clause 5.9(d) or upon termination and discharge of each Transaction Document and each Credit Support Document.

• (d) If, at an Exchange Rate Calculation Date, the aggregate Current Dollar Amount of each outstanding Funding Portion is less than the sum of:

• (1) the Commitment; and

• (2) the balance of deposits held by the Lender under clause 5.9(c),

then Sims may direct the Lender to apply (and if so directed the Lender must apply) the lesser of the amount of the difference and the balance of the deposits towards repayment or prepayment of the Principal Outstanding under a Facility.

[*] Confidential Treatment Requested

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6 Cash Advance Facility

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5.10 Unavailability of a currency

If, before the specified time for determining the Applicable Screen Rate for a Funding Portion on the Rate Set Date under a Facility (other than the Credit Support Facility) to be denominated in a Foreign Currency (other than USD) on any Rate Set Date:

• (a) Sims has received notice from the Lender that the Foreign Currency requested for that Funding Portion is not readily available to the Lender in the amount required or is not freely convertible into Dollars or USD in the Relevant Interbank Market; or

• (b) the Lender notifies the Borrowers that compliance with its obligation to provide the Funding Portion in the proposed Foreign Currency would require the Lender to obtain an Authorisation which has not already been obtained, would contravene a law or regulation applicable to it or is otherwise impossible or impracticable,

• then the Lender will not be required to provide that Funding Portion in the Foreign Currency, but must if requested by Sims, provide that Funding Portion in USD.

• 6 Cash Advance Facility

• 6.1 Provision of Funding Portions

• (a) If a Borrower gives a Funding Notice for a Funding Portion under the Cash Advance Facility denominated in Dollars, the Lender must provide, subject to this agreement, the Funding Portion in Same Day Funds.

• (b) If a Borrower gives a Funding Notice for a Funding Portion denominated in a Foreign Currency, and, in the case of a Foreign Currency other than an Available Currency, the Lender in its absolute discretion consents to provide the Funding Portion in that Foreign Currency the Lender must provide, subject to this agreement, the Funding Portion in Same Day Funds in the Foreign Currency specified not later than 12 noon (being the time in the place of payment) on the specified Funding Date to the account specified by the Borrower in the Funding Notice and otherwise in accordance with the relevant Funding Notice.

6.2 Number of Funding Portions

• The Borrowers must ensure that no more than [*] Funding Portions under the Cash Advance Facility are outstanding at any time.

• 6.3 Consolidation and division of Funding Portions

• (a) If 2 or more Funding Portions under the Cash Advance Facility have Funding Periods which are of the same duration, then those Funding Portions will be consolidated into, and treated as, a single Funding Portion.

• (b) If a Borrower requests in a Selection Notice that a Funding Portion for the Cash Advance Facility be divided into 2 or more Funding Portions with different Funding Periods selected by the Borrower in a manner which complies with

[*] Confidential Treatment Requested

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6 Cash Advance Facility

• clause 5.5, then that Funding Portion will be divided into the amounts and with the Funding Periods specified in the Selection Notice.

6.4 Selection Notice

A Selection Notice to be effective must be:

• (a) in writing in the form of Schedule 5; and

• (b) received by the Lender before 11.00am on a Business Day [*] before the Selection Date for a relevant Funding Portion funded in Dollars and [*] before the Selection Date for a relevant Funding Portion funded in a Foreign Currency under the Cash Advance Facility (or any shorter period that the Lender agrees in writing).

6.5 Repayment

• Each Borrower must repay each Funding Portion made to it and all other Outstanding Moneys:

• (a) in full on the earlier of:

  • (1) the Termination Date for the Cash Advance Facility (if any); and

  • (2) the Final Termination Date; and

• (b) otherwise as required under this agreement.

• 6.6 Prepayment under Cash Advance Facility

• (a) A Borrower may prepay all or part of the Principal Outstanding under the Cash Advance Facility by giving the Lender [*] prior notice specifying:

  • (1) the prepayment date;

  • (2) the relevant Funding Portions which are to be prepaid in whole or in part.

• (b) Prepayment of part of the Principal Outstanding under the Cash Advance Facility that is denominated in an Available Currency may only be made:

  • (1) in the case of any prepayment denominated in and permitted to be made in Dollars, [*] ; and

  • (2) in the case of any prepayment denominated in and permitted to be made in a Foreign Currency, [*] .

• (c) The Borrowers must prepay the amount specified in the prepayment notice on the prepayment date specified in the notice together with all unpaid interest accrued to the prepayment date in respect of the prepaid amount.

• (d) The Commitment is not reduced by an amount prepaid under this clause 6.6 and accordingly, subject to this agreement, a prepaid amount may be redrawn.

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6 Cash Advance Facility

• (e) A notice given under clause 6.6(a) is irrevocable.

6.7 Prepayment date

• The Borrower may make a prepayment under clause 6.6 on any Business Day.

• 6.8 Interest

• (a) The Borrower of a Funding Portion under the Cash Advance Facility must pay interest on the principal amount of the Funding Portion for each Funding Period at the Funding Rate for the Funding Period.

• (b) Interest is calculated on daily balances on the basis of a 365 day year (in the case of a Funding Portion denominated in AUD or Sterling) and on the basis of a 360 day year (in the case of a Funding Portion other than one denominated in AUD or Sterling) and for the actual number of days elapsed from and including the first day of each Funding Period to, but excluding, the last day of the Funding Period or, if earlier, the date of prepayment or repayment of the Funding Portion under this agreement.

• (c) The Borrowers must pay accrued interest in arrears to the Lender on each Interest Payment Date.

6.9 Liquidity Bills

• (a) The Borrowers irrevocably and for value authorise the Lender, at its option, to prepare Liquidity Bills in respect of a Funding Portion under the Cash Advance Facility so that:

• (1) their total face value amount does not exceed the outstanding principal amount of the Funding Portion and total interest payable to the Lender in respect of the Funding Portion;

• (2) their maturity date is not later than the last day of the Funding Period for that Funding Portion,

• and to sign them as drawer or endorser in the name of and on behalf of the relevant Borrower.

• (b) The Lender may negotiate or deal with any Liquidity Bill prepared by it as it sees fit and for its own benefit.

• (c) The Lender must pay any Tax on or in respect of the Liquidity Bills and any dealing with the Liquidity Bills.

• (d) The Lender indemnifies a Borrower of a Funding Portion under the Cash Advance Facility against any Loss which the Borrower suffers, incurs or is liable for in respect of the Borrower being a party to a Liquidity Bill.

• (e) Nothing in clause 6.9(d) affects a Borrower’s obligations under this agreement (including any Borrower’s obligations in relation to the payment of the Outstanding Moneys) which are absolute and unconditional obligations and not affected by any actual or contingent liability of the Lender to a Borrower under clause 6.9(d).

[*] Confidential Treatment Requested

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7 Commercial Bills Facility

• (f) If a Borrower discharges any Liquidity Bill by payment, the amount of that payment is regarded as applied on the date of payment against the money owing by the Borrower to the Lender.

6.10 Fees

• The Borrowers will pay to the Lender such fees referable to the Cash Advance Facility initially as specified in the Fee Schedule and thereafter as advised by the Lender from time to time.

• 7 Commercial Bills Facility

7.1 Bill acceptance and endorsement procedure

Where a Funding Notice has been delivered in accordance with clause 5.2, Bills have been delivered to the Lender under clause 7.2 or prepared by it under clause 7.3 and where this clause 7 has been complied with in respect of those Bills the Lender must, subject to this agreement:

• (a) in respect of Bills it is required to accept, accept those Bills;

• (b) in respect of Bills it is required to endorse, endorse those Bills;

• (c) in respect of Bills it is required to discount, insert as payee itself (if not already done) or such other person it has arranged to purchase those Bills.

7.2 Preparation of Bills

• If a Borrower gives a Funding Notice for a Bill Funding the Borrower must:

• (a) prepare Bills comprised in a Bill Funding in accordance with clause 7.4;

• (b) sign each Bill in the Borrower’s relevant capacity;

• (c) if a third party is named as drawer, cause the third party to sign the Bills as drawer; and

• (d) deliver those Bills to the Lender:

  • (1) [*] if the Lender is required to accept and discount or endorse and discount those Bills; and

  • (2) [*] if the Lender is required to accept only or endorse only those Bills.

• 7.3 Failure to prepare Bills

• (a) the Borrower of a Bill Funding fails to prepare or sign or deliver Bills in accordance with clause 7.2; or

• (b) the Lender elects to do so,

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7 Commercial Bills Facility

each Borrower irrevocably authorises the Lender to prepare and sign (by one of its Officers) as drawer, acceptor or endorser those Bills on behalf of the Borrower and in accordance with clause 7.4.

7.4 Form of Bills

• (a) Each Bill comprised in a Bill Funding must:

  • (1) be in the form approved by the Lender from time to time;

  • (2) be payable on a specified date and so as to exclude days of grace for payment;

  • (3) have a maturity date which is a Business Day before the end of the Availability Period;

  • (4) have a tenor equal to its Funding Period selected in the relevant Funding Notice (or any other period agreed to by the Lender) or required by this agreement (but not greater than 185 nor less than 30 days);

  • (5) for Bills the Lender is required to accept, be drawn with the Borrower of the Bill Funding as drawer and the Lender as acceptor and the Lender as payee, or at the Lender’s option, or if the Lender is not discounting the Bill, with the name of the payee left blank;

  • (6) for Bills the Lender is required to endorse, be drawn with a third party named as drawer and the Borrower of the Bill Funding as acceptor and the Lender as payee;

  • (7) for Bills the Lender is required to accept, be expressed to be payable at the Lending Office or such other place as the Lender may notify from time to time; and

  • (8) be denominated in Dollars.

• (b) The aggregate Face Value Amount of all Bills comprised in a Bill Funding must equal the aggregate amount of the Bill Funding requested under the relevant Funding Notice.

• (c) The Lender may vary the term and maturity date of any Bill comprised in a Bill Funding, despite any different term or maturity date requested in the relevant Funding Notice, if in the Lender’s opinion the variation is necessary so as to ensure that each Bill complies with this agreement, in particular clauses 7.4(a) and 7.4(b).

• (d) Each Borrower and the Lender must observe the requirements of the Bills of Exchange Act 1909 (Cth) to ensure the validity of each Bill.

• 7.5 Restriction on use by the Lender

The Lender must not use or deal with any Bill delivered to or prepared by it under this clause 7 except in accordance with this clause 7.

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7 Commercial Bills Facility

• 7.6 Tax on Bills

• (a) The Borrower of a Bill Funding must pay any Tax (other than an Excluded Tax) on or in respect of Bills and any dealing with Bills and the proceeds of Bills.

• (b) To the extent possible, any such Tax must be paid before any Bills are delivered to the Lender under clause 7.2.

• 7.7 Signing of Bills and appointment of Lender as attorney

• (a) All Bills under the Commercial Bills Facility to be signed by a Borrower (whether as drawer, acceptor or endorser) must be signed by an Officer on its behalf.

• (b) The Borrower must, immediately upon any change occurring in the identity of its Officers authorised to sign, draw, accept and endorse Bills on its behalf, provide to the Lender a new certificate satisfactory to the Lender to replace any certificate provided under clause 2.1.

• (c) Each Borrower irrevocably authorises and appoints the Lender and each Officer of the Lender as its attorney to prepare and execute for and on behalf of, and in the name of, any Borrower and to complete all Bills required by a Borrower for a Bill Funding.

• (d) Each Borrower must ratify and confirm anything done or caused to be done by its attorney pursuant to the power and authority granted by it under clause 7.7(c) or by the Lender in respect of any Bill which conforms with the relevant Funding Notice (as varied pursuant to clause 7.4(c)) and this agreement.

• 7.8 Notification of rate and discounting procedure

• (a) Where a Bill Funding has been requested, the Lender must not later than 10.45am (Sydney time) on the Funding Date notify the Bill Discount Rate for that Funding Date to Sims.

• (b) If:

  • (1) before 11.15am (Sydney time) on the Funding Date the Borrower of the Bill Funding accepts the Lender’s Bill Discount Rate and requests the Lender to discount Bills; or

  • (2) the Borrower of the Bill Funding has requested the Lender to discount Bills in the relevant Funding Notice,

the Lender must discount, or procure the discount of, those Bills at the Bill Discount Rate notified by it under clause 7.8(a) and, subject to clause 7.14(b), it must pay to the Borrower by 2.00 pm (Sydney time) on the Funding Date the aggregate Face Value Amount of the Bills less the aggregate of:

• (3) [*] in respect of each Bill;

• (4) [*] in respect of those Bills;

• (5) any amount payable by the Borrower under clauses 7.6, 7.10 or 7.11 which remains unpaid; and

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7 Commercial Bills Facility

  - (6) any Outstanding Current Bill Amount in respect of Bills under the Commercial Bills Facility on the Funding Date.

• (c) Any amount deducted by the Lender under clause 7.8(b)(5) or 7.8(b)(6) must be applied in discharge of the Borrower’s obligations to the Lender under clauses 7.10 or 7.11, or in payment of the relevant amount of Tax, as the case may be.

• 7.9 Bills accepted or endorsed but not discounted

• If the Lender is not required to discount Bills under clause 7.8:

• (a) before 1.00pm (Sydney time) on the Funding Date the Lender must, following acceptance or endorsement of the Bills in accordance with clause 7.1, release the Bills to the Borrower of the Bill Funding at the Lending Office but only against receipt of Same Day Funds for:

  • (1) the Bill Acceptance / Endorsement Fee in respect of those Bills;

  • (2) any amount payable by a Borrower under clauses 7.6, 7.10 or 7.11 which remains unpaid;

  • (3) any Outstanding Current Bill Amount in respect of Bills under the Commercial Bills Facility on the Funding Date; and

• (b) each Borrower agrees that the Lender is entitled to participate in any tender or other process under which the Bills are discounted.

7.10 Borrower’s primary liability to pay Bills

As between the Lender and the Borrowers, the Borrowers are primarily liable in respect of Bills accepted by the Lender or endorsed by the Lender and accordingly the liability of a Borrower with respect to any Bill is not discharged if the Lender pays the Bill as acceptor or endorser or becomes the holder of the Bill at any time whether before, on or after maturity.

7.11 Indemnity in respect of Bills

The Borrowers indemnify the Lender against any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment (including, but not limited to, any Tax referred to in clause 7.6) which the Lender suffers, incurs or is liable for by reason of or arising out of or in consequence of the Lender signing, drawing, accepting or endorsing any Bill or otherwise dealing with any Bill in the manner contemplated by this agreement.

7.12 Variation of procedures

The Lender may vary any of the times at or by which any thing is to be done under this clause 7 to ensure the effective operation of the procedures contemplated by this clause 7. Any such variation will be binding on the Borrowers immediately upon Sims being notified of it.

7.13 Fees

• (a) On each Funding Date on which a Bill Funding is made, including in respect of a Bill Funding drawn in accordance with clause 7.14(e), the Borrowers must pay

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7 Commercial Bills Facility

• to the Lender [*] , an amount equal to [*] per annum of the Face Value Amount of each Bill accepted by the Lender on that Funding Date, calculated for the number of days in the tenor of each Bill on the basis of a 365 day year.

• (b) The Borrowers will pay to the Lender such other fees referable to the Commercial Bills Facility initially as specified in the Fee Schedule and thereafter as advised from time to time by the Lender to the Borrowers with at least 30 days notice.

7.14 Repayment by cash cover and netting

• (a) Subject to clause 7.14(b), the Borrower must not later than 1.00pm (Sydney time) on the maturity date for a Bill comprised in a Bill Funding which is accepted by the Lender, or endorsed and held at maturity by the Lender, pay to the Lender an amount equal to the Face Value Amount of the Bill.

• (b) If all or part of a Bill Funding is to be redrawn on the last day of its Funding Period, then on that day the only amount that must be paid or made available by the Lender or the Borrowers, as the case may be depending on the amount of the Bill Funding, is the difference between:

• (1) the amount which the Borrowers are required to pay to the Lender in respect of Bills maturing on that day under clause 7.14 (a) and 7.14(d) plus any amount the Borrowers are required to pay on that date under clauses 7.8(b)(4) and 7.8(b)(5); and

• (2) any Net Bill Proceeds (excluding the amount payable under clause 7.8(b)(6)) which the Lender is required to pay or make available to the Borrower in respect of replacement Bills on that day under clause 7.8.

• (c) Clause 7.8(b) applies to clause 7.14(b) only to the extent specified in clause 7.14(b).

• (d) In respect of a Bill endorsed by the Lender and held by a third party at maturity the Borrower of the relevant Bill Funding must:

• (1) on the maturity date immediately notify the Lender when the Borrower discharges that Bill; and

• (2) if demand is made on the Lender as endorser of the Bill immediately on demand pay to the Lender an amount equal to the Face Value Amount of the Bill.

• (e) If, on the maturity date for a Bill comprised in a Bill Funding, a Borrower has not paid any amount payable to the Lender in accordance with clauses 7.14(a), 7.14(b) or 7.14(d), each Borrower irrevocably authorises and appoints the Lender and each Officer of the Lender as its attorney to prepare and execute for and on behalf of, and in the name of, any Borrower and to complete all Bills required by a Borrower for a Bill Funding, as in the opinion of the Lender are necessary and in such amounts as are sufficient to result in Net Bill Proceeds of an amount equal to the amount of any such payment otherwise payable to the Lender under clauses 7.14(a), 7.14(b) or 7.14(d).

• (f) Each Borrower must ratify and confirm anything done or caused to be done by its attorney pursuant to the power and authority granted by it under clause 7.14(e).

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8 Credit Support Facility

7.15 Acknowledgment regarding signed Bills

The Borrowers acknowledge that if the Lender, without actual notice to the contrary, relies on Bills which appear to have genuine signatures of Officers of a Borrower, the Lender has no further duty to enquire as to the signatory’s authority or any other matters in connection with execution of the Bill and the indemnity in clause 7.11 will not be affected by any lack of authority, fraud or forgery by any person (other than the Lender or its employees).

• 8 Credit Support Facility

8.1 Issue of Credit Support Documents

If a Borrower gives a Funding Notice under the Credit Support Facility, the Lender must, subject to this agreement, issue each Credit Support Document requested in the Funding Notice on the specified Funding Date in the specified Available Currency and otherwise in accordance with that Funding Notice.

8.2 Additional Funding Notice requirements

Each Funding Notice requesting the issue of any Credit Support Document must, in addition to satisfying clause 5.2, specify in relation to each requested Credit Support Document:

• (a) details of each Beneficiary Contract to which it relates (including, without limitation, details of the Beneficiary and the terms and conditions of any Beneficiary Contract (by annexing a copy to the Funding Notice or by any other means acceptable to the Lender in its absolute discretion);

• (b) whether it is required to be in the form of a Standby LC or Bank Guarantee;

• (c) its proposed Funding Date;

• (d) its proposed Expiry Date;

• (e) the currency in which it is to be denominated;

• (f) its Face Value Amount in Dollars or, if it is to be denominated in a Foreign Currency, its Face Value Amount in the Foreign Currency;

• (g) the effective interest rate, and the period for which that interest is to accrue, if applicable, under any Finance Contract to which it relates; and

• (h) any other information the Lender may reasonably require from time to time.

• 8.3 Form of Credit Support Documents

A Credit Support Document must:

• (a) be substantially in a form acceptable to the Lender, in its sole discretion;

• (b) unless otherwise agreed by the Lender, have a minimum Face Value Amount:

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8 Credit Support Facility

  - (1) if denominated in Dollars, of **[*]** ; or

  - (2) if denominated in a Foreign Currency, **[*]** of **[*]** ;

• (c) be payable at a Lending Office;

• (d) only be payable on a Business Day;

• (e) unless otherwise agreed by the Lender, have an Expiry Date which is before the Termination Date for the Credit Support Facility (if any) and the Final Termination Date;

• (f) have an Expiry Date which is a date not more than 14 days after the termination date of any Beneficiary Contract to which it relates unless otherwise agreed;

• (g) be irrevocable and non transferable; and

• (h) be denominated in an Available Currency.

• 8.4 Prepayment under Credit Support Facility

• (a) A Borrower may prepay the Principal Outstanding in relation to any Current Credit Support Document issued under the Credit Support Facility by giving the Lender [*] notice specifying:

  • (1) the prepayment date; and

  • (2) the relevant Current Credit Support Documents.

• (b) The Borrowers must prepay each Current Credit Support Document specified in the prepayment notice on the prepayment date specified in the notice by either:

  • (1) returning to the Lender the originals of each Current Credit Support Document specified in the prepayment notice for cancellation by the Lender or an acknowledgement from each Beneficiary of each such Credit Support Document in favour of the Lender that each such Beneficiary has no right to make a claim under the relevant Credit Support Document; or

  • (2) paying cash cover to the Lender in Same Day Funds and in Dollars in an amount equal to the Current Dollar Amount of each Current Credit Support Document specified in the prepayment notice.

• (c) The Lender must apply any cash cover received by it under clause 8.4(b)(2) in accordance with clause 13.3.

• (d) A notice given under clause 8.4(a) is irrevocable.

• 8.5 Prepayment date

• The Borrower may make a prepayment under clause 8.4 on any Business Day.

• 8.6 Cash cover

• The Borrowers must not later than 1.00pm (Sydney time) on the earlier of:

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8 Credit Support Facility

• (a) the Termination Date for the Credit Support Facility; and

• (b) the Final Termination Date,

• repay each Current Credit Support Document by either:

• (c) returning to the Lender the originals of each Current Credit Support Document for cancellation by the Lender or an acknowledgement from each Beneficiary of each such Credit Support Document in favour of the Lender that each such Beneficiary has no right to make a claim under the relevant Credit Support Document; or

• (d) paying cash cover to the Lender in Same Day Funds and in Dollars in an amount equal to the Current Dollar Amount of each Current Credit Support Document.

8.7 Fees

• (a) On each Funding Date on which a Credit Support Document is issued to the Borrowers, and thereafter on each date falling 6 months after the date on which a Credit Support Document is issued to the Borrowers, the Borrowers must pay to the Lender a fee equal to the greater of:

  • (1) the Credit Support Document Fee Rate per annum of the Face Value Amount of each Credit Support Document issued, calculated for the 6 month period following the date on which the fee is payable, up to and including the Expiry Date of the relevant Credit Support Document and on the basis of a 365 day year; and

  • (2) $80.00 for each Credit Support Document issued.

• (b) The Borrowers will pay to the Lender such other fees referable to the Credit Support Facility initially as specified in the Fee Schedule and thereafter as advised by the Lender from time to time.

• 8.8 Tax on Credit Support Documents

The Borrowers must pay any Tax (other than an Excluded Tax) on or in respect of any issued Credit Support Document.

8.9 Liability of Borrowers

• (a) If the Lender makes any payment to a Beneficiary under a Credit Support Document, the Borrowers must pay to the Lender immediately on demand Same Day Funds in the same amount and in the same currency as the payment made by the Lender to the Beneficiary.

• (b) The liability of the Borrowers under clause 8.9(a) in respect of any Credit Support Document is a continuing obligation and only ceases upon the Borrower paying to the Lender all amounts required to be paid under this agreement in respect of the Credit Support Document.

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8.10 Early expiration or reduction

• (a) The Borrowers may agree with a Beneficiary to vary a Credit Support Document so that:

• (1) the Credit Support Document will expire on a date before the Expiry Date; or

• (2) the Face Value Amount of the Credit Support Document is reduced,

or both, but the agreement is not binding upon the Lender in any case unless the Lender has given its prior written consent such consent not to be unreasonably withheld or delayed.

• (b) The consent of the Lender under clause 8.10(a) will only be given if:

• (1) the proposed variation has been notified in writing to the Lender by Sims;

• (2) except in the case of Bank Guarantees, the Beneficiary’s bank has notified the Lender that it agrees to the proposed variation; and

• (3) Sims has requested the Lender to re-issue a replacement Credit Support Document incorporating the proposed variation,

and any consent only becomes effective when the original Credit Support Document is returned to the Lender or, if the Credit Support Document has been lost or destroyed, when the Lender receives, in a form and substance satisfactory to it, a written confirmation (on the Beneficiary’s letterhead) given by a director or other officer acceptable to the Lender of the Beneficiary, as to the circumstances of the loss or destruction of the original Credit Support Document and acknowledging that no claim will be made under it.

8.11 Beneficiary Contracts and notification

Each Borrower must:

• (a) use all reasonable endeavours to comply with all its obligations under or in respect of each Beneficiary Contract; and

• (b) give notice to the Lender promptly upon becoming aware of any:

• (1) material breach of any term by a Transaction Party; or

• (2) termination, rescission or discharge,

of any Beneficiary Contract.

8.12 Obligations of the Lender

If a Beneficiary satisfies all requirements of a Credit Support Document regarding payment under the Credit Support Document, the Lender must pay the Beneficiary despite:

• (a) any breach by a Borrower or any other Transaction Party of any of its obligations under any Transaction Document or of any provision of a Beneficiary Contract;

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8 Credit Support Facility

• (b) any direction by a Borrower to the Lender not to pay;

• (c) any right of set off or other claim which a Borrower or any other Transaction Party may have against the Beneficiary;

• (d) any dispute between a Borrower or any other Transaction Party and the Beneficiary;

• (e) any dispute by a Borrower as to the obligation of the Lender to make payment; or

• (f) any other thing notified or known to the Lender relating to a Borrower, any other Transaction Party and any Beneficiary.

8.13 Indemnity in respect of Credit Support Document

The Borrowers jointly and severally indemnify the Lender against any Loss which the Lender pays, suffers, incurs or is liable for by reason of, arising out of, or in consequence of:

• (a) the Lender issuing, making payment under or consenting to any amendment to or variation of any Credit Support Document;

• (b) any claim or purported claim for payment under a Credit Support Document; or

• (c) anything done by any person who is or claims to be entitled to the benefit of a Credit Support Document,

provided that the Lender has acted with due care in connection with the Credit Support Document and other than any Loss due to the negligent failure of the Lender to enquire as to whether any notice or demand has been inaccurately transmitted or received from any cause whatsoever or has been given or sent by an unauthorised person.

• 8.14 Unconditional nature of Borrower’s obligations

• (a) The obligations of a Borrower under this agreement, including clause 8.13, are absolute and unconditional and are not released or discharged or otherwise affected by anything which but for this provision might have that effect, including:

  • (1) any set off, deduction, counterclaim, agreement, defence, suspension, deferment or other claim which the Borrower or any other Transaction Party may have against the Lender or any Beneficiary;

  • (2) any falsity, inaccuracy, insufficiency or forgery of or in any communication which on its face purports to be a communication signed or authorised under any Relevant Credit Support Document;

  • (3) any communication inaccurately transmitted or received or sent by an unauthorised person;

  • (4) any impossibility or illegality of performance of any Relevant Credit Support Document;

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9 Trade Finance Facility

  - (5) any act of any Government Agency, court or arbitrator or application of any law (present or future) in any jurisdiction affecting any of the terms of any Relevant Credit Support Document;

  - (6) any failure by any person to obtain any Authorisation or other approval or consent necessary or appropriate in connection with any Relevant Credit Support Document;

  - (7) any falsity, inaccuracy, insufficiency or forgery of or in any document presented to the Lender as a Beneficiary Contract or otherwise in respect of a Credit Support Document and which appears to the Lender in its opinion to correspond to the documents specified in the Funding Notice requesting the relevant Credit Support Document or otherwise required under the relevant Credit Support Document;

  - (8) any Relevant Credit Support Document which is wholly or partly void, voidable, unenforceable or invalid; or

  - (9) any other act, omission, matter or thing whatsoever whether negligent or not, provided that the Lender has acted with due care in connection with the Credit Support Document and other than a negligent failure of the Lender to enquire as to whether any notice or demand has been inaccurately transmitted or received from any cause whatsoever or has been given or sent by an unauthorised person.

• (b) The Lender is not liable for any failure, and is not required to make any enquiries, in respect of any matter listed in clause 8.14(a) with respect to any claim which on its face complies with the relevant Credit Support Document.

• (c) Clauses 8.14(a) and 8.14(b) apply irrespective of:

  • (1) the consent or knowledge, or lack of consent or knowledge, of the Lender, any Transaction Party or any other person of any event described in clause 8.14(a); or

  • (2) any rule of law or equity to the contrary.

• 9 Trade Finance Facility

• 9.1 Additional Funding Notice requirements

• (a) Each Funding Notice requesting the issue of a Funding Portion under the Trade Finance Facility must, in addition to satisfying clause 5.2, specify in relation to each requested Funding Portion:

  • (1) whether the requested Funding Portion is to be provided as a Documentary LC, Proceeds of Negotiation or a Trade Advance; and

  • (2) the relevant Obligation to which the Funding Portion applies.

• (b) Each Funding Notice requesting that a Funding Portion be provided as a Documentary LC must, in addition to satisfying clause 5.2, specify in relation to each requested Documentary LC:

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  - 9     Trade Finance Facility

• (1) details of each Beneficiary Contract to which it relates (including, without limitation, details of the Beneficiary and the terms and conditions of any Beneficiary Contract (by annexing a copy to the Funding Notice or by any other means acceptable to the Lender in its absolute discretion);

• (2) the form of the Payment Documents (by annexing a copy of the form of each Payment Document or a detailed description of it to the Funding Notice);

• (3) all other required terms and conditions of the Documentary LC (by annexing an Application for Irrevocable Documentary Credit);

• (4) its proposed Funding Date;

• (5) its proposed Expiry Date;

• (6) the currency in which it is to be denominated;

• (7) its Face Value Amount in Dollars or, if it is to be denominated in a Foreign Currency, its Face Value Amount in the Foreign Currency;

• (8) the effective interest rate, and the period for which that interest is to accrue, if applicable, under any Finance Contract to which it relates; and

• (9) any other information the Lender may reasonably require from time to time.

• (c) Each Funding Notice requesting that a Funding Portion be provided as Proceeds of Negotiation must be accompanied by:

• (1) such application forms and authorities as are required by the Lender in its discretion; and

• (2) the relevant Foreign Bill.

9.2 Provision of Advances

• If Part 4 of the Key Terms Schedule specifies that Trade Advances are “Available” and a Borrower gives a Funding Notice for a Trade Advance:

• (a) denominated in Dollars, the Lender must provide, subject to this agreement, the Funding Portion in Same Day Funds, to be applied in accordance with clause 9.3;

• (b) denominated in a Foreign Currency, and, in the case of a Foreign Currency other than an Available Currency, the Lender in its absolute discretion consents to provide the Funding Portion in that Foreign Currency, the Lender must provide, subject to this agreement, the Funding Portion in Same Day Funds in the Foreign Currency specified not later than 12 noon (being the time in the place of payment) on the specified Funding Date, to be applied in accordance with clause 9.3.

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9 Trade Finance Facility

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9.3 Application of Trade Advances

The Lender will apply each Trade Advance under the Trade Finance Facility towards satisfaction of the Obligation specified in the Funding Notice, on the Funding Date specified in that Funding Notice.

9.4 Repayment of Trade Advances

• Each Borrower must repay each Trade Advance on the Interest Payment Date for that Funding Portion.

• 9.5 Interest on Advances

• (a) The Borrower of a Trade Advance must pay interest on the principal amount of the Trade Advance at the Funding Rate for the Funding Period.

• (b) Interest is calculated on daily balances on the basis of a 365 day year (in the case of a Trade Advance denominated in AUD or Sterling) and on the basis of a 360 day year (in the case of an Advance other than one denominated in AUD) and for the actual number of days elapsed from and including the first day of each Funding Period to, but excluding, the last day of the Funding Period or, if earlier, the date of prepayment or repayment of the Trade Advance under this agreement.

• (c) The Borrowers must pay accrued interest in arrears to the Lender at the end of each month during the Funding Period and on the Interest Payment Date for the Advance.

9.6 Issue of Documentary LCs

If Part 4 of the Key Terms Schedule specifies that Documentary LCs are “Available” and a Borrower gives a Funding Notice requesting a Documentary LC under the Trade Finance Facility, the Lender must, subject to this agreement, issue each Documentary LC requested in the Funding Notice on the specified Funding Date in the specified Available Currency and otherwise in accordance with that Funding Notice.

9.7 Form of Documentary LCs

A Documentary LC must:

• (a) be substantially in a form acceptable to the Lender, in its sole discretion;

• (b) be payable at a Lending Office;

• (c) only be payable on a Business Day;

• (d) unless otherwise agreed by the Lender, have an Expiry Date which is before the Termination Date for the Trade Finance Facility (if any) and the Final Termination Date;

• (e) have an Expiry Date which is a date not more than 14 days after the termination date of any Beneficiary Contract to which it relates unless otherwise agreed;

• (f) be irrevocable and non transferable; and

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9 Trade Finance Facility

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• (g) be denominated in an Available Currency.

9.8 Credit Support Document terms apply to Documentary LC

Clauses 8.4 to 8.6 (inclusive) and clauses 8.8 to 8.14 (inclusive) apply to each Documentary LC provided under the Trade Finance Facility as though each reference to the ‘Credit Support Facility’ were to the Trade Finance Facility, each reference to a ‘Credit Support Document’ were to a Documentary LC and each reference to a ‘Current Credit Support Document’ were to a Current Documentary LC.

9.9 Foreign Bills Negotiation

If Part 4 of the Key Terms Schedule specifies that Proceeds of Negotiation are “Available” and a Borrower gives a Funding Notice for Proceeds of Negotiation the Lender must, subject to this agreement, negotiate Foreign Bills duly presented to the Lender for negotiation and shall pay the Proceeds of Negotiation to the Borrower of the Funding Portion.

9.10 Interest on Proceeds of Negotiation

• (a) The Borrower of a Funding Portion provided as Proceeds of Negotiation must pay interest on the principal amount of the Proceeds of Negotiation at the Funding Rate for the Funding Period.

• (b) Interest is calculated on daily balances on the basis of a 365 day year (in the case of Proceeds of Negotiation denominated in AUD or Sterling) and on the basis of a 360 day year (in the case of Proceeds of Negotiation other than one denominated in AUD or Sterling) and for the actual number of days elapsed from and including the first day of each Funding Period to, but excluding, the last day of the Funding Period or, if earlier, the date of prepayment or repayment of the Proceeds of Negotiation under this agreement.

• (c) The Borrowers must pay accrued interest in arrears to the Lender on each Interest Payment Date for the relevant Funding Portion and on the date on which the Proceeds of Negotiation are repaid to the Lender in full in accordance with clause 9.11.

9.11 Repayment of Proceeds of Negotiation

• (a) The Borrowers must procure that any Funding Portion provided as Proceeds of Negotiation is repaid in full on or before the expiry date of the relevant Foreign Bill negotiated by the Lender in accordance with clause 9.9.

• (b) The parties acknowledge and agree that payment or reimbursement in full by a counterparty bank under a Foreign Bill negotiated by the Lender in accordance with clause 9.9 will be deemed to be a repayment of the relevant Funding Portion provided as Proceeds of Negotiation.

9.12 Extension of repayment of Proceeds of Negotiation

• (a) A Borrower of a Funding Portion provided as Proceeds of Negotiation may request an extension for the repayment of the Funding Portion by:

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10 Overdraft Facility

• (1) on any date prior to the date on which the Foreign Bill negotiated by the Lender in accordance with clause 9.9 in connection with the Proceeds of Negotiation expires ( Expiring Bill ), giving notice to the Lender in writing that it requests an extension for the repayment of the Proceeds of Negotiation; and

• (2) providing the Lender with a replacement Foreign Bill on substantially the same terms (other than as to its expiry date) and for the same principal amount as the Expiring Bill ( Replacement Bill ).

• (b) If a Borrower has requested an extension for the repayment of a Funding Portion provided as Proceeds of Negotiation in accordance with clause 9.12(a) the Lender may, in its absolute discretion, agree to extend the date for repayment of the Proceeds of Negotiation in accordance with the terms of the Replacement Bill.

• (c) If the Lender agrees to extend the date for repayment of the Proceeds of Negotiation in accordance with this clause 9.12, the Borrowers must procure that the Funding Portion provided as Proceeds of Negotiation will be repaid in full on or before the expiry date of the Replacement Bill.

9.13 Fees

The Borrowers will pay to the Lender such other fees referable to the Trade Finance Facility initially, as specified in the Fee Schedule and thereafter as advised by the Lender from time to time.

• 10 Overdraft Facility

10.1 Overdraft Facility

• (a) The Lender agrees to make the Overdraft Facility available on the terms and conditions set out in this agreement and the Group Limit Facility.

• (b) If there is any inconsistency between the terms of this agreement and the terms of the Group Limit Facility, the terms of the Group Limit Facility will prevail to the extent of the inconsistency.

10.2 Funding Portions

• (a) A Funding Portion under the Overdraft Facility may be in any minimum amount and the requirements of clause 5.4 do not apply to the Overdraft Facility.

• (b) Any number of Funding Portions under the Overdraft Facility may be outstanding at any time.

10.3 Prepayment

• A Borrower may prepay a Funding Portion drawn under the Overdraft Facility at any time in whole or in part.

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11 Representations and warranties

10.4 Fees

• The Borrowers will pay to the Lender the Lender’s account services fees, notified to Sims from time to time and such other fees referable to the Overdraft Facility in accordance with the Group Limit Facility.

• 11 Representations and warranties

11.1 Representations and warranties

Each Borrower makes the representations and warranties contained in clause 3 of the Common Terms Deed for themselves and on behalf of each other Transaction Party for the benefit of the Lender, as if those representations and warranties were set out in full in this clause 11.1.

11.2 Survival and repetition of representations and warranties

• The representations and warranties given under this agreement:

• (a) survive the execution of each Transaction Document; and

• (b) are deemed to be repeated on each date representations and warranties are repeated under clause 3.2(b) of the Common Terms Deed with respect to the facts and circumstances then subsisting.

11.3 Reliance by Lender

Each Borrower acknowledges that the Lender has entered into each Transaction Document to which it is a party in reliance on the representations and warranties given under this agreement.

• 12 Undertakings

12.1 Incorporated undertakings

The Borrowers must, and must ensure that each other Transaction Party will, comply with clause 4 of the Common Terms Deed.

12.2 Compliance

Each Borrower must, and must ensure that each other Transaction Party will, comply with all its obligations under each Transaction Document to which it is a party.

12.3 Term of undertakings

Unless the Lender otherwise agrees in writing, until:

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13 Events of Default

• (a) the Commitment is cancelled; and

• (b) the Outstanding Moneys are unconditionally repaid in full;

• each Borrower must, at its own cost, comply with its undertakings in this clause 12.

• 13 Events of Default

13.1 Events of Default

An Event of Default occurs if an ‘Event of Default’ as defined in the Common Terms Deed occurs, whether or not it is within the control of a Transaction Party.

13.2 Effect of Event of Default

Clauses 5.2 to 5.4 (inclusive) of the Common Terms Deed apply to this agreement as if set out in full in this agreement and as if references in those clauses to ‘this deed’ were to ‘this agreement’.

• 13.3 Application of cash cover under Commercial Bills Facility, Trade Finance Facility and Credit Support Facility

• (a) The Lender must apply any cash cover paid to it under clause 7.14, 8.4(b)(2), 8.6 or 13.2 or pursuant to clause 9.8:

  • (1) firstly, against the obligations of the Borrowers under this agreement in respect of any Current Credit Support Document or Current Bill in relation to which the cash cover was lodged; and

  • (2) secondly, in payment of the balance, if any, of the Outstanding Moneys.

• (b) The Lender is not required to pay any interest on any amount of cash cover paid to it under clause 7.14, 8.4(b)(2), 8.6 or 13.2 or pursuant to clause 9.8.

• (c) If the Lender is satisfied that:

  • (1) every Current Credit Support Document, Current Bill and Current Documentary LC has been paid in full or discharged; and

  • (2) no Outstanding Moneys are or may become due,

then the Lender must, if it receives a written notice from Sims to do so, repay to the Borrowers any amount paid to the Lender under clause 7.14, 8.4(b)(2), 8.6 or 13.2 or pursuant to clause 9.8 which has not been, or is not required to be, applied in accordance with clause 13.3(a).

13.4 New Related Body Corporate

• (a) Where, after the date of this agreement, an entity becomes a Related Body Corporate of a Transaction Party and, at such time, financial accommodation has been provided to such entity by the Lender or any other member of the

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14 Fees

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Commonwealth Bank Group ( Existing Accommodation ), the Lender may, at any time within 60 days after the notification to the Lender that an entity that has been provided with Existing Accommodation has become a Related Body Corporate of a Transaction Party, by notice in writing to that entity or any other Transaction Party declare:

  - (1) that where the notice is given to the relevant entity, the Existing Accommodation (or any lesser amount specified in the notice) is due and payable within the period specified in the notice which shall be not less than 60 days; or

  - (2) that where the notice is given to a Transaction Party other than the relevant entity, financial accommodation then provided by the Lender to that Transaction Party must be reduced by payment of an amount (specified in the notice) equal to or less than the existing accommodation within the period specified in the notice.

• (b) Amounts specified in a notice given pursuant to 13.4(a) are payable within the period specified in such notice.

• 14 Fees

• The Borrowers must pay to the Lender the following fees:

• (a) commitment fee : a non-refundable commitment fee equal to the Commitment Fee Rate per annum calculated on a daily basis on the daily balance of the Undrawn Commitment on the basis of a 365 day year and for the actual number of days elapsed, to be paid in arrears on the last day of each calendar quarter; and

• (b) [*]

• 15 Interest on overdue amounts

• 15.1 Payment of interest

Each Borrower must pay interest on:

• (a) any of the Outstanding Moneys due and payable by it, but unpaid; and

• (b) any interest payable but unpaid under this clause 15.

15.2 Accrual of interest

The interest payable under this clause 15:

• (a) accrues from day to day from and including the due date for payment up to the actual date of payment, before and, as an additional and independent obligation, after any judgment or other thing into which the liability to pay the Outstanding Moneys becomes merged; and

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16 Assignment and substitution

• (b) may be capitalised at monthly intervals.

15.3 Rate of interest

The rate of interest payable under this clause 15 on any part of the Outstanding Moneys is the higher of:

• (a) the Overdue Rate determined by the Lender:

  • (1) on the date that part of the Outstanding Moneys becomes due and payable but is unpaid; and

  • (2) on each date which is 1 month after the immediately preceding date on which the Overdue Rate was determined under this clause 15.3(a); and

• (b) the rate fixed or payable under a judgment or other thing referred to in clause 15.2(a).

• 16 Assignment and substitution

• Clause 13 of the Common Terms Deed applies to this agreement as if set out in full in this agreement and as if references in that clause to ‘this deed’ were to ‘this agreement’ other than the reference to ‘this deed’ in clause 13.2(c) which should be read as a reference to the Common Terms Deed.

• 17 Additional Borrowers

17.1 Additional Borrowers

Sims may request that any of its wholly owned Subsidiaries becomes an Additional Borrower. That Subsidiary shall become an Additional Borrower if:

• (a) the Lender approves the addition of that Subsidiary as an Additional Borrower;

• (b) Sims delivers to the Lender a duly completed and executed Accession Deed for the accession of that Subsidiary as an Additional Borrower;

• (c) Sims confirms that no Default is continuing or would occur as a result of that Subsidiary becoming an Additional Borrower; and

• (d) the Subsidiary has acceded as an “Additional Borrower” and an “Additional Guarantor” under the Common Terms Deed.

17.2 Repetition of Representations

Delivery of an Accession Deed to the Lender constitutes confirmation by the relevant Subsidiary that the representations and warranties in the Transaction Documents are true and correct in relation to it as at the date of delivery as if made by reference to the facts and circumstances then existing.

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18 General

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18 General

• 18.1 Governing law and jurisdiction

• (a) This agreement is governed by the laws of New South Wales.

• (b) Each Borrower irrevocably submits to the exclusive jurisdiction of the courts of New South Wales.

• (c) Each Borrower irrevocably waives any objection to the venue of any legal process on the basis that the process has been brought in an inconvenient forum.

• (d) Each Borrower irrevocably waives any immunity in respect of its obligations under this agreement that it may acquire from the jurisdiction of any court or any legal process for any reason including the service of notice, attachment before judgment, attachment in aid of execution or execution.

• (e) Each Borrower (other than Sims) appoints Sims Metal Management Limited of Sir Joseph Banks Corporate Park, Suite 3, Level 2 32-34 Lord Street Botany NSW 2019 Australia in relation to proceedings in New South Wales as its agent to receive service of any legal process on its behalf without excluding any other means of service permitted by the law of New South Wales.

• (f) Sims irrevocably accepts its appointment as process agent under clause 18.1(e).

• 18.2 Prohibition and enforceability

• (a) Any provision of, or the application of any provision of, any Transaction Document or any Power which is prohibited in any jurisdiction is, in that jurisdiction, ineffective only to the extent of that prohibition.

• (b) Any provision of, or the application of any provision of, any Transaction Document which is void, illegal or unenforceable in any jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions in that or any other jurisdiction.

18.3 Waivers

• (a) Waiver of any right arising from a breach of this agreement or of any Power arising on default under this agreement or on the occurrence of an Event of Default must be in writing and signed by the party granting the waiver.

• (b) A failure or delay in exercise, or partial exercise, of:

• (1) a right arising from a breach of this agreement or the occurrence of an Event of Default; or

• (2) a Power created or arising on default under this agreement or on the occurrence of an Event of Default,

does not result in a waiver of that right or Power.

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18 General

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• (c) A party is not entitled to rely on a delay in the exercise or non-exercise of a right or Power arising from a breach of this agreement or on a default under this agreement or on the occurrence of an Event of Default as constituting a waiver of that right or Power.

• (d) A party may not rely on any conduct of another party as a defence to exercise of a right or Power by that other party.

• (e) This clause may not itself be waived except in writing.

18.4 Variation

A variation of any term of this agreement must be in writing and signed by the parties.

18.5 Cumulative rights

The Powers are cumulative and do not exclude any other right, power, authority, discretion or remedy of the Lender, any Receiver or Attorney.

18.6 Counterparts

• (a) This agreement may be executed in any number of counterparts.

• (b) All counterparts, taken together, constitute one instrument.

• (c) A party may execute this agreement by signing any counterpart.

18.7 Attorneys

Each of the attorneys executing this agreement states that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

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		Schedules
Table of contents
Borrowers		48
Key Terms Schedule		50
Fee Schedule		53
Funding Notices		56
Selection Notice		62
Renewal Notice		64
Roll over of existing Drawings		67
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Schedule 1 Borrowers

Schedule 1

Borrowers

Clause 1.2 (Definitions)

Name	Jurisdiction of incorporation / registration / organisation	Company number (if any)
Sims Metal Management Limited	Australia	69 114 838 630
Sims Group Australia Holdings Limited	Australia	37 008 634 526
Sims Aluminium Pty Limited	Australia	93 004 370 905
Sims Group UK Limited	United Kingdom	3242331
Sims Group UK Holdings Limited	United Kingdom	2904307
Mirec B.V.	The Netherlands	17073024
Sims Recycling Solutions AB	Sweden	N/A
Sims Group USA Corporation	Delaware	N/A
Sims Group Global Trade Corporation	Delaware	N/A
North Carolina Resource Conservation, LLC	North Carolina	N/A
Sims Group USA Holdings Corporation	Delaware	N/A
Schiabo Larovo Corporation	Delaware	N/A
Simsmetal East LLC	Delaware	N/A
Simsmetal West LLC	Delaware	N/A

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Schedule 1 Borrowers

Name	Jurisdiction of incorporation / registration / organisation	Company number (ifany)
Metal Management, Inc.	Delaware	N/A
Metal Management Alabama, Inc.	Delaware	N/A
Metal Management Arizona, L.L.C.	Arizona	N/A
Metal Management Connecticut, Inc.	Delaware	N/A
Metal Management Memphis, L.L.C.	Tennessee	N/A
Metal Management Midwest, Inc.	Illinois	N/A
Metal Management Mississippi, Inc.	Delaware	N/A
Metal Management Northeast, Inc.	New Jersey	N/A
Metal Management Ohio, Inc.	Ohio	N/A
Metal Management West, Inc.	Colorado	N/A
Proler Southwest LP	Texas	N/A
Metal Dynamics Detroit LLC	Delaware	N/A

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Schedule 2

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Key Terms Schedule

Part 1 – Cash Advance Facility

Facility	Available.
Facility Limit	Not applicable.
Purpose	Financing or supporting the working capital needs of the Sims Group.
Termination Date	Not applicable.
Margin	The Margin determined in accordance with the following table:
	Gearing Ratio	Margin
	[*]	[*]
Part 2 – Commercial Bills Facility
Facility	Available.
Facility Limit	Not applicable.
Purpose	Financing or supporting the working capital needs of the Sims Group.
Termination Date	Not applicable.
Bill Acceptance /
Endorsement Fee
Rate	The Bill Acceptance / Endorsement Fee Rate determined in accordance with the following table:

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<Schedule 2 Key Terms Schedule

Bill Acceptance / Endorsement Gearing Ratio Fee Rate

[] []

Part 3 – Credit Support Facility

Facility	Available.
Facility Limit	Not applicable.
Purpose	Financing or supporting the working capital needs of the Sims Group.
Termination Date	Not applicable.
Credit Support	The Credit Support Document Fee Rate determined in accordance with the
Document Fee Rate	following table:
		Credit Support Document Fee
	Gearing Ratio	Rate
	[*]	[*]

Part 4 – Trade Finance Facility

Facility	Available.
Documentary LCs	Available.
Trade Advances	Available.
Proceeds of
Negotiation	Available.
Facility Limit	Not applicable.

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<Schedule 2 Key Terms Schedule

Purpose The financing or refinancing of Obligations.

Termination Date	Not applicable.
Margin	The Margin determined in accordance with the following table:

	Gearing Ratio	Margin
	[*]	[*]
Part 5 – Overdraft Facility
Facility	Available.
Purpose	Financing or supporting the working capital needs of the Sims Group.
Termination Date	Not applicable.
Overdraft Borrower	1 Sims Group Australia Holdings Limited;

• 2 Sims Aluminium Pty Limited;

3 Sims Metal Management Ltd; and

• 4 any other entity agreed by the Lender to be an “Applicant” for the purposes of the Group Limit Facility in accordance with paragraph (2)(g) of the Group Limit Facility.

Part 6 – General
Commitment	$450,000,000
Commitment Fee	On any date,[*]of the Margin on that date.
Rate
Final Termination	31 December 2010.
Date
Overdue Margin	[*]per annum.
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Schedule 3

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Fee Schedule

1.1 Cash Advance Facility fees

Such fees referable to the Cash Advance Facility as advised by the Lender to Sims from time to time.

1.2 Commercial Bills Facility fees

Charge type Bill Handling Fee 1.3 Credit Support Facility fees Such fees referable to the Credit Support Facility as advised by the Lender to Sims from time to time. 1.4 Trade Finance Facility fees Product Charge Type Pricing Imports Import Documentary Collections Document handling [*] Accepted Bills received for payment [*] Documents free of payment [*] Consignment [*] AWB release issuance [*] Avalisation Bills of Exchange [*] Additional handling charges [*] Import Documentary Letters of Credits (IDLC) Issuance [*] Issuance — via bank’s e-channel [*] Amendment [*] Amendment — via bank’s e-channel [*]	Charge type Bill Handling Fee 1.3 Credit Support Facility fees Such fees referable to the Credit Support Facility as advised by the Lender to Sims from time to time. 1.4 Trade Finance Facility fees Product Charge Type Pricing Imports Import Documentary Collections Document handling [*] Accepted Bills received for payment [*] Documents free of payment [*] Consignment [*] AWB release issuance [*] Avalisation Bills of Exchange [*] Additional handling charges [*] Import Documentary Letters of Credits (IDLC) Issuance [*] Issuance — via bank’s e-channel [*] Amendment [*] Amendment — via bank’s e-channel [*]	Pricing [*]	Min/Max [*] Min/Max	Min/Max
	[*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]		[*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]

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Schedule 3 Fee Schedule

Product Bank’s e-channel Drawings under IDLC Exports Export Documentary Collections Foreign Bills Negotiated Export Documentary Letters Credits (EDLC)	Charge Type Increase in value Extension of expiry Back-to-back issuance Cash-covered issuance structuring System set-up Monthly channel cost Document handling Acceptance/deferred payment Drawing under expired DC Discrepancy fee Reimbursement Commission Telex fee Document handling Documents free of payment Tracers for payment Additional handling charges Document handling Additional handling charges Advising Advising of amendments Assignment of proceeds Transfer of EDLC Transfer of amendment Confirmation of EDLC (charge for Bank and Country Risk) Without Recourse Export Finance	Pricing [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]	Min/Max
			[*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]

Drawings under EDLC	Document handling	[*]	[*]
	Acceptance	[*]	[*]
	Discrepancy fee	[*]	[*]
	Telex fee	[*]	[*]

[*] Confidential Treatment Requested

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Schedule 3 Fee Schedule

Product Trade Advances Out of pocket expenses	Charge Type Draw down Roll over Prepayment Late payment fee SWIFT per message Telex per message Fax per message (international) Fax per message (domestic) Courier (International) Courier (domestic) Express post	Pricing [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]	Min/Max
			[*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]

[*] Confidential Treatment Requested

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Schedule 4

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Funding Notices

Clause 5.2 (Requirements for a Funding Notice)

Part A – Funding Notice (Cash Advance Facility and Trade Advances or Proceeds of Negotiation under Trade Finance Facility)

To: [ insert name of Lender ] ( Lender )

Attention: [ insert relevant name ]

We refer to the multi-option facility agreement dated 2 November 2009 between each party listed in Schedule 1 of that agreement (as Borrowers ) and Commonwealth Bank of Australia (as Lender ) ( Facility Agreement ).

Under clause 5 of the Facility Agreement:

• (a) We give you notice that we wish to draw on [ insert date ] ( Funding Date ).

• (b) The aggregate Original Dollar Amount to be drawn is $ [ insert amount ] .

• (c) Particulars of each Funding Portion are:

Borrower	Facility	Dollars or specify Foreign Currency	Principal Amount (in Dollars or applicable Foreign Currency)	Original Dollar Amount	Funding Period	Obligation (Trade Finance Facility only)

• (d) The proceeds of each Funding Portion are to be used in accordance with clause 4.2 of the Facility Agreement.

• (e) We request that the proceeds [be remitted to account number [ insert account number ] at [ insert details ] /be applied towards satisfaction of the above Obligation.]

• (f) [ Note: for Proceeds of Negotiation only ] [The Foreign Bill to be negotiated in connection with the Funding Portion is attached.]

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<Schedule 4 Funding Notices

• (g) We represent and warrant that no Default has occurred which is continuing or will result from the provision of any Funding Portion [, except as follows: [ insert details ], and we propose the following remedial action [ insert details ]] .

• A term defined in the Facility Agreement has the same meaning when used in this Funding Notice.

date

Signed for and on behalf of [ insert Borrower ] by

sign here �

Officer

print name

[*] Confidential Treatment Requested

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<Schedule 4 Funding Notices

Part B – Commercial Bills Facility

Clause 5.2 (Requirements for a Funding Notice)

To: [ insert name of Lender ] (Lender)

Attention: [ insert relevant name ]

We refer to the multi-option facility agreement dated 2 November 2009 between each party listed in Schedule 1 of that agreement (as Borrowers ) and Commonwealth Bank of Australia (as Lender ) ( Facility Agreement ).

Under clause 5 of the Facility Agreement:

• (a) we give you notice that we wish to draw on [ insert date ] ( Funding Date );

• (b) the aggregate Dollar Amount to be drawn is $ [ insert amount ] ;

• (c) particulars of the Funding Portion are:

Borrower	Facility	Face Value Amount	Funding Period

and in respect of each Bill Funding we request that you accept only/accept and discount/ endorse only/endorse and discount each Bill comprised therein.

• (d) Please prepare, complete and sign the Bills comprised in each Bill Funding on our behalf.

• (e) We represent and warrant that no Default has occurred which is continuing or will result from the provision of any Funding Portion [, except as follows: [ insert details ], and we propose the following remedial action [ insert details ]] .

A term defined in the Facility Agreement has the same meaning when used in this Funding Notice.

[*] Confidential Treatment Requested

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<Schedule 4 Funding Notices date Signed for and on behalf of [ insert Borrower ] by sign here � Officer print name

[*] Confidential Treatment Requested

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<Schedule 4 Funding Notices

Part C – Funding Notice (Credit Support Facility and Documentary LCs under Trade Finance Facility)

Clause 5.2 (Requirements for a Funding Notice)

To: [ insert name of Lender ] (Lender)

Attention: [ insert relevant name ]

We refer to the multi-option facility agreement dated 2 November 2009 between each party listed in Schedule 1 of that agreement (as Borrowers ) and Commonwealth Bank of Australia (as Lender ) ( Facility Agreement ).

Under clause 5 of the Facility Agreement:

• (a) we give you notice that we wish to draw on [ insert date ] ( Funding Date );

• (b) the aggregate Original Dollar Amount to be drawn is $ [ insert amount ] ;

• (c) particulars of the Funding Portion are:

Face Value Amount (in Type of contingent Dollars or liability (Documentary applicable Original LC, Standby LC or Expiry Foreign Dollar Borrower Facility Bank Guarantee) Date Currency) Amount Beneficiary

• (d) [ A copy of the Beneficiary Contract for each Credit Support Document requested above is attached. ]

• (e) [A copy of the Payment Documents for each Documentary LC requested above is attached.]

• (f) [A copy of the Application for Irrevocable Documentary Credit for each Documentary LC requested above is attached.]

• (g) [The effective rate interest rate and period for which that interest is to accrue under each of the Finance Contracts for each Credit Support Document requested above is as follows: [ insert details ]]

• (h) We request that you deliver each requested Credit Support Document to the relevant Beneficiary specified above;

• (i) We represent and warrant that no Default has occurred which is continuing or will result from the provision of any Funding Portion [, except as follows: [ insert details ], and we propose the following remedial action [ insert details ]] .

[*] Confidential Treatment Requested

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<Schedule 4 Funding Notices A term defined in the Facility Agreement has the same meaning when used in this Funding Notice.

date Signed for and on behalf of [ insert Borrower ] by sign here � Officer

print name

[*] Confidential Treatment Requested

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Schedule 5

Selection Notice

Clause 6.4 (Selection Notice)

To: [ insert name of Lender ] ( Lender )

Attention: [ insert relevant name ]

We refer to the multi-option facility agreement dated 2 November 2009 between each party listed in Schedule 1 of that agreement (as Borrowers ) and Commonwealth Bank of Australia (as Lender ) ( Facility Agreement ).

Under clause 5 of the Facility Agreement:

• (a) We give you notice that we wish to select the following Funding Period for the following Funding Portion under the Cash Advance Facility with effect on the date that the current Funding Period applicable to the relevant Funding Portion ends: [insert details of Funding Portion including the Principal Amount, existing Funding Period, new Funding Period and Selection Date] .

• (b) We give you notice that we wish to divide the following Funding Portion under the Cash Advance Facility into the following amounts and with the following Funding Periods with effect on the date that the current Funding Period applicable to the relevant Funding Portion ends: [insert details of Funding Portion including the Principal Amount, existing Funding Period, new divided Funding Portions and new Funding Periods for the divided Funding Portions ].

• (c) We represent and warrant that no Default has occurred which is continuing [, except as follows: [ insert details ], and we propose the following remedial action [ insert details ]] .

A term defined in the Facility Agreement has the same meaning when used in this Selection Notice.

[*] Confidential Treatment Requested

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<Schedule 5 Selection Notice date Signed for and on behalf of the Borrowers by sign here � Officer print name

[*] Confidential Treatment Requested

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Schedule 6 Renewal Notice

Schedule 6

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Renewal Notice

To: [ insert name of Lender ] ( Sims )

Attention: [ insert relevant name ]

Date:

We refer to the multi-option facility agreement dated 2 November 2009 between each party listed in Schedule 1 of that agreement (as Borrowers ) and the Commonwealth Bank of Australia (as Lender ) ( Facility Agreement ).

Under clause 4.5 of the Facility Agreement we give you notice that the Lender has agreed to extend the Final Termination Date by 12 months, from [ insert date ] ( Existing Final Termination Date ) to [ insert date ] ( New Final Termination Date ), subject to the following conditions:

• (a) the Borrowers indicating their acknowledgement and agreement to the extension of the Final Termination Date by 12 months, by signing and delivering this notice to the Lender within 30 days of receiving it;

• (b) [the Borrowers indicating their acknowledgement and agreement to the Key Terms Schedule being amended and restated in the form set out in the Schedule to this notice, by initialling the attached schedule and delivering the initialled schedule (attached to this notice) to the Lender within 30 days of receiving it]; and

• (c) [ insert additional conditions precedent as required ].

Subject to the above conditions being satisfied, we agree that on and from the Existing Final Termination Date:

• (d) the definition of “Final Termination Date” in clause 1.2 of the Facility Agreement shall be amended to be the New Final Termination Date; [and

• (e) the Key Terms Schedule will be amended and restated in the form set out in the attached Schedule; and.

• (f) the “Margin” for the purposes of the Group Limit Facility will be amended to be as follows:]

Group Limit Amount ($A) [] []	Margin
	[] []

• (g) A term defined in the Facility Agreement has the same meaning when used in this Renewal Notice.

[*] Confidential Treatment Requested

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	Schedule 6 Renewal Notice
Schedule — Amended and restated Key Terms Schedule
[to be inserted]
Lender
Signed for
[Commonwealth Bank of Australia]
by its attorney
sign here�
Attorney
print name
in the presence of
sign here�
Witness
print name

[*] Confidential Treatment Requested

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sign here� print name sign here� print name	Schedule 6 Renewal Notice Agreed and acknowledged by Sims on behalf of the Borrowers: Sims Signed for Sims Metal Management Limited Director Director/Company Secretary

[*] Confidential Treatment Requested

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Schedule 7 Roll over of existing Drawings �

Schedule 7

Roll over of existing Drawings

Clause 3 (Roll over of principal outstanding)

Borrower Sims Group Australia Holdings Limited (formerly known as Sims Metal Limited) Sims Group Australia Holdings Limited Sims Group Australia Holdings Limited Sims Group Australia Holdings Limited Sims Group Australia Holdings Limited Sims Metal Management Limited on behalf of Sims E-Recycling Pty Limited Sims Group UK Limited Sims Group UK Limited Sims Group UK Limited Sims Group UK Limited and Mirec B.V. Sims Group UK Limited Sims Group UK Limited and Mirec B.V.	Description of drawing under Existing Multi- Option Facility Agreement AUD10,000 bank guarantee issued on 6 June 1984 in favour of[*]. AUD50,000 bank guarantee issued on 18 May 2005 in favour of[*]. AUD88,360 bank guarantee issued on 31 October 2005 in favour of[*]. AUD1,000,000 bank guarantee issued on 26 June 2008 in favour of[*]. AUD50,000 bank guarantee issued on 6 February 2009 in favour of[*]. AUD42,625 bank guarantee issued on 12 March 2009 in favour of[*]. EUR150,000 bank guarantee issued on 3 June 2005 in favour of[*]. EUR20,000 bank guarantee issued on 13 June 2005 in favour of[*]. EUR15,000 bank guarantee issued on 13 June 2006 in favour of[*]. EUR20,000 bank guarantee issued on 8 May 2007 in favour of[*]. EUR15,000 bank guarantee issued on 9 May 2009 in favour of[*]. GBP41,665 bank guarantee issued on 1 October 2007 in favour of[*].	Identification Number [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]	Facility under this agreement
			Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility

[*] Confidential Treatment Requested

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Schedule 7 Roll over of existing Drawings �

Borrower Sims Group UK Limited Sims Group UK Limited Mirec B.V. Sims Recycling Solutions AB Sims Group UK Limited Sims Group UK Limited Sims Recycling Solutions Canada Ltd Sims Hugo Neu West Sims Hugo Neu Corp. Sims Group USA Holding Corporation Simsmetal West LLC Sims Metal Management Limited Sims Group UK Limited Sims Group UK Limited Sims Group UK Limited	Description of drawing under Existing Multi- Option Facility Agreement EUR3,488.79 bank guarantee issued on 12 November 2007 in favour of[*]. EUR3,944.84 bank guarantee issued on 12 November 2007 in favour of[*]. EUR150,000 bank guarantee issued on 4 January 2008 in favour of[*]. EUR50,000 bank guarantee issued on 18 January 2008 in favour of[*]. EUR14,348 bank guarantee issued on 20 May 2008 in favour of[*]. EUR275,000 bank guarantee issued on 8 December 2008 in favour of[*]. CAD500,000 letter of credit issued on 2 October 2008 in favour of[*]. USD300,000 letter of credit issued 11 January 2006 in favour of[*]. USD3,075,466 letter of credit issued 14 March 2006 in favour of[*]. USD60,000 letter of credit issued 18 June 2007 in favour of[*]. USD250,000 letter of credit issued 26 July 2007 in favour of[*]. AUD74,797.30 bank guarantee issued on 28 September 2009 in favour of[*]. GBP212,984 bank guarantee issued on 12 May 2009 in favour of[*]. EUR94,055 bank guarantee issued on 8th July 2009 in favour of[*]. EUR90,000 bank guarantee issued on 18th August 2009 in favour of[*].	Identification Number [*] [*] [*] N/A [*] [*] [*] [*] [*] [*] [*] [*] [*] [*] [*]	Facility under this agreement
			Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility Credit Support Facility

[*] Confidential Treatment Requested

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Borrower Sims Group UK Limited	Description of drawing under Existing Multi- Option Facility Agreement GBP3,110 bank guarantee issued on 17th September 2009 in favour of[*].	Schedule 7 Roll o Identification Number [*]	ver of existing Drawings� Facility under this agreement
			Credit Support Facility

[*] Confidential Treatment Requested

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sign here� print name sign here� print name sign here� print name sign here� print name	Signing page Executed as an agreement Sims Signed sealed and delivered by Sims Metal Management Limited by Company Secretary/Director Director Borrower Signed sealed and delivered by Sims Group Australia Holdings Limited by Company Secretary/Director Director

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered by Sims Aluminium Pty Limited by
	Company Secretary/Director
	Director
	Borrower Signed sealed and delivered by Sims Group UK Limited by
	Company Secretary/Director
	Director

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered by Sims Group UK Holdings Limited by
	Company Secretary/Director
	Director
	Borrower Signed sealed and delivered by Mirec B.V. by
	Company Secretary/Director
	Director
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered by Sims Recycling Solutions AB by
	Company Secretary/Director
	Director
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Sims Group USA Corporation by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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Borrower

Signed sealed and delivered for Sims Group Global Trade Corporation by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of sign here � Witness print name

Borrower Signed sealed and delivered for North Carolina Resource Conservation, LLC by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness print name

[*] Confidential Treatment Requested

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Signing page

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Borrower

sign here� print name sign here� print name sign here� print name sign here� print name	Signed sealed and delivered for Sims Group USA Holdings Corporation by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Schiabo Larovo Corporation by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Simsmetal East LLC by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Simsmetal West LLC by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Metal Management, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Management Alabama, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Metal Management Arizona, L.L.C. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Management Connecticut, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Metal Management Memphis, L.L.C. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Management Midwest, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Metal Management Mississippi, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Management Northeast, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Metal Management Ohio, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Management West, Inc. by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for Proler Southwest LP by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Metal Dynamics Detroit LLC by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

[*] Confidential Treatment Requested

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sign here� print name sign here� print name	Signing page Lender Signed sealed and delivered for Commonwealth Bank of Australia by its attorney Attorney in the presence of Witness

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Attachments

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Table of contents

Accession Deed — Additional Borrowers

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page 1

Attachment 1

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Accession Deed — Additional Borrowers

Clauses 1.2 (Definitions) and 17 (Additional Borrowers)

Date �

This deed poll is made by

Sims Sims Metal Management Limited

ACN 114 838 630 of Sir Joseph Banks Corporate Park, Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

Additional Borrower [ ] [ insert ACN/ABN/ARBN ] of [ ]

• Background 5 Under the Facility Agreement dated 2 November 2009 ( Facility Agreement ) between each party listed in Schedule 1 of that agreement (as Borrowers ) and Commonwealth Bank of Australia (as Lender ) a person may become a Borrower by execution of this deed poll.

• 6 The Additional Borrower wishes to become a Borrower on the terms and conditions set out in this deed poll.

This deed poll witnesses as follows:

• 1 Interpretation

• (a) Words and phrases defined in the Facility Agreement (including by incorporation) have the same meaning when used in this deed poll.

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<Attachment 1 Accession Deed – Additional Borrowers

• (b) In this deed poll, Existing Borrower has the meaning set out below.

Term Existing Borrower	Meaning
	each person which is a Borrower under the Facility Agreement at the time of execution of this deed poll.

• 2 Representations and warranties

• The Additional Borrower represents and warrants to, and for the benefit of the Lender, as set out in clause 11.1 of the Facility Agreement, on the basis that:

• (a) each reference to a Borrower in clause 11.1 of the Facility Agreement includes a reference to the Additional Borrower;

• (b) each reference to a Transaction Document includes this deed and each other Transaction Document to which the Additional Borrower is a party; and

• (c) clauses 11.2 and 11.3 of the Facility Agreement apply to this clause 2 as if set out in full.

• 3 Status of Additional Borrower

The Additional Borrower agrees that it irrevocably becomes an ‘Additional Borrower’ as defined in, and for all purposes under, the Facility Agreement as if named in and as a party to the Facility Agreement, and accordingly is bound by the Facility Agreement as an Additional Borrower.

• 4 Receipt of documents

The Additional Borrower acknowledges having received and reviewed to its satisfaction a copy of each Transaction Document and each other document requested by it before signing this deed poll.

• 5 Confirmation by existing Transaction Parties

• Sims (for itself and as attorney for each other Transaction Party) confirms that nothing in this deed poll:

• (a) affects the validity or enforceability of the Transaction Documents;

• (b) prejudices or adversely affects any right, power, authority, discretion or remedy arising under the Transaction Documents; or

[*] Confidential Treatment Requested

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<Attachment 1 Accession Deed – Additional Borrowers

• (c) discharges, releases or otherwise affects any liability or obligation arising under the Transaction Documents.

• 6 Governing law

• This deed poll is governed by the laws of New South Wales.

• 7 Benefit of deed poll

• This deed poll is given in favour of and for the benefit of:

• (1) the Lender; and

• (2) each Borrower,

• under the Facility Agreement and their respective successors and permitted assigns

• 8 Address for notices

The details for the Additional Borrower for service of notices are:

• Address: [ ] .

Attention: [ ] .

Facsimile: [ ] .

• 9 Attorneys

Each of the attorneys executing this deed poll states that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

[*] Confidential Treatment Requested

page 3

sign here� print name sign here� print name sign here� print name sign here� print name	<Attachment 1 Accession Deed – Additional Borrowers Executed as a deed poll Additional Borrower Signed sealed and delivered for [ ] by its attorney Attorney in the presence of Witness Sims Signed sealed and delivered for Sims Metal Management Limited for itself and as attorney for each other Transaction Party Director Director/Company Secretary

[*] Confidential Treatment Requested

page 4

EX-4.14 c53813exv4w14.htm EX-4.14

Exhibit 4.14

Deed

Sims Metal Management Limited Common Terms Deed Sims Metal Management Limited Each person listed in Part 1 of Schedule 1 Each person listed in Part 2 of Schedule 1 Each person listed in Part 3 of Schedule 1

adam.stapledon@freehills.com

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MLC Centre Martin Place Sydney NSW 2000 Australia GPO Box 4227 Sydney NSW 2001 Australia Sydney Melbourne Perth Brisbane Singapore

Telephone +61 2 9225 5000 Facsimile +61 2 9322 4000 www.freehills.com DX 361 Sydney

Correspondent offices in Hanoi Ho Chi Minh City Jakarta

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	Contents
Table of contents
The agreement	1
Operative part	2
1 Definitions and interpretation	2
1.1 Agreement components	2
1.2 Definitions	2
1.3 Interpretation	18
1.4 Inclusive expressions	19
1.5 Business Day	19
1.6 Accounting Standards	19
2 Operation of Common Terms	20
2.1 Several obligations and rights of Lenders	20
2.2 Terms of Transaction Documents	20
3 Representations and warranties	21
3.1 Representations and warranties	21
3.2 Survival and repetition of representations and warranties	24
3.3 Reliance by Lender	25
4 Undertakings	25
4.1 Provision of information and reports	25
4.2 Proper accounts	26
4.3 Notices to the Lender	26
4.4 Compliance	26
4.5 Maintenance of capital	26
4.6 Compliance with laws and Authorisations	27
4.7 Payment of Taxes and outgoings	27
4.8 Conduct of business	27
4.9 Maintenance of existence	27
4.10 Negative pledge	28
4.11 No change to business	28
4.12 Financial accommodation	28
4.13 Restrictions on dealings	29
4.14 Maintenance of assets	29
4.15 Insurance	29
4.16 Hedging	29
4.17 Financial undertakings	30
4.18 Guarantors	30
4.19 Deed of Cross Guarantee	30
4.20 Term of undertakings	31

Contents 1

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	Contents
vents of Default	31
5.1 Events of Default	31
5.2 Effect of Event of Default	34
5.3 Transaction Parties to continue to perform	35
5.4 Enforcement	35
eview Event	35
uarantee and indemnity	36
7.1 Guarantee	36
7.2 Payment	36
7.3 Securities for other money	36
7.4 Amount of Outstanding Moneys	36
7.5 Proof by Lender	37
7.6 Avoidance of payments	37
7.7 Indemnity for avoidance of Outstanding Moneys	37
7.8 No obligation to marshal	38
7.9 Non-exercise of Guarantors’ rights	38
7.10 Principal and independent obligation	38
7.11 Suspense account	39
7.12 Unconditional nature of obligations	39
7.13 No competition	41
7.14 Continuing guarantee	42
7.15 Variation	42
7.16 Judgments	43
erman Guarantors	43
ayments	44
9.1 Manner of payment	44
9.2 Payments on a Business Day	44
9.3 Payments in gross	44
9.4 Additional payments	45
9.5 Taxation deduction procedures	45
9.6 Tax Credit	45
9.7 Tax affairs	45
9.8 Amounts payable on demand	46
9.9 Appropriation of payments	46
9.10 Currency exchanges	46
9.11 Currency of account	46
9.12 Change of currency	47
Increased costs and illegality	47
10.1 Increased costs	47
10.2 Illegality	48
Indemnities	49
11.1 General indemnity	49
11.2 Foreign currency indemnity	49

5 Events of Default

6 Review Event

7 Guarantee and indemnity

8 German Guarantors

9 Payments

10 Increased costs and illegality

11 Indemnities

11.1 General indemnity 11.2 Foreign currency indemnity

50 50

11.3 Conversion of currencies

11.4 Continuing indemnities and evidence of loss

12 Fees, Tax, costs and expenses

Fees, Tax, costs and expenses	50
12.1 Tax	50
12.2 Costs and expenses	51

Contents 2

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	Contents
12.3 GST	51
Assignment and substitution	52
13.1 Assignment by Transaction Party	52
13.2 Assignment by Lender	52
13.3 Assist	52
13.4 Securitisation permitted	52
13.5 Participation permitted	53
13.6 Lending Office	53
13.7 No increase in costs	53
New Lenders and Additional Transaction Parties	53
14.1 New Lenders	53
14.2 Retired Lenders	53
14.3 Additional Borrowers	53
14.4 Additional Guarantors	54
14.5 Repetition of Representations	54
Representatives	54
15.1 Lender as agent or trustee	54
15.2 Transaction Parties’ agent	55
Saving provisions	55
16.1 No merger of security	55
16.2 Exclusion of moratorium	55
16.3 Conflict	56
16.4 Consents	56
16.5 Principal obligations	56
16.6 Non-avoidance	56
16.7 Set-off authorised	57
16.8 Lender’s certificates and approvals	57
16.9 No reliance or other obligations and risk assumption	57
16.10 Power of attorney	58
General	58
17.1 Confidential information	58
17.2 Transaction Party to bear cost	59
17.3 Dispute Resolution	59
17.4 Notices	61
17.5 Governing law and jurisdiction	62
17.6 Prohibition and enforceability	62
17.7 Waivers	63
17.8 Variation	63
17.9 Cumulative rights	63
17.10 Counterparts	63
17.11 Attorneys	63

13 Assignment and substitution

14 New Lenders and Additional Transaction Parties

15 Representatives

16 Saving provisions

17 General

Schedules

Parties	65
Part 1 – Original Borrowers	65
Part 2 – Original Guarantors	67
Part 3 – Original Lender	71

Contents 3

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	Contents
Verification certificate	72
Compliance Certificate	75
Conditions Precedent	77
Signing page	78
Attachments
Accession Deed – Additional Guarantors and Additional Borrowers
Accession Deed – New Lenders

Contents 4

The agreement

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Common Terms Deed

Date � 2 November 2009

Between the parties Sims

Sims Metal Management Limited

ACN 114 838 630 of Sir Joseph Banks Corporate Park, Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

( Sims )

Original Borrowers Each party listed in Part 1 of Schedule 1

(each an Original Borrower )

Original Guarantors Each party listed in Part 2 of Schedule 1

(each an Original Guarantor )

Original Lender The party listed in Part 3 of Schedule 1

( Original Lender )

• Background 1 One or more of the Lenders may agree from time to time to provide Facilities to one or more of the Borrowers.

• 2 The Transaction Parties and each Lender wish to set out in this deed standard terms and conditions to apply to each Facility.

This deed witnesses

that in consideration of, among other things, the mutual promises contained in this deed, the parties agree as set out in the Operative part of this deed.

page 1

Operative part

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• 1 Definitions and interpretation

1.1 Agreement components

This deed includes any schedule.

1.2 Definitions

The meanings of the terms used in this document are set out below.

Term Meaning Accession Deed an accession deed in the form of Attachment 1. Accounting Standards generally accepted accounting principles in Australia. ACDC Australian Commercial Disputes Centre Limited.

ACDC Guidelines for the ACDC Guidelines for Expert Determination (or, if the ACDC ceases to exist, the guidelines for Expert Determination expert determination of any similar organisation nominated by the Law Society of NSW) in force from time to time. Additional Borrower a person which becomes an Additional Borrower in accordance with clause 14.3. Additional Guarantor a person which becomes an Additional Borrower in accordance with clause 14.4. Attorney an attorney appointed under a Transaction Document.

• Authorisation 1 any consent, registration, filing, agreement, notice of non-objection, notarisation, certificate, licence, approval, permit, authority or exemption from, by or with a Government Agency; or

• 2 in relation to anything which a Government Agency may prohibit or restrict within a specific period, the expiry of that period without intervention or action or notice of intended intervention or action.

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1 <Definition and interpretation

Term Bill Borrower Business Day	Meaning
	a bill of exchange as defined in the_Bills of Exchange Act 1909_(Cth). 1 each Original Borrower; and 2 each Additional Borrower. 1 for the purposes of clause 17.4, a day on which banks are open for business in the city where the notice or other communication is received excluding a Saturday, Sunday or public holiday; and

• 2 for the purposes of a Transaction Document, any other day specified as a Business Day for the purposes of that Transaction Document;

• 3 for all other purposes, a day on which banks are open for business in Sydney and Melbourne excluding a Saturday, Sunday or public holiday.

• Calculation Date 30 June and 31 December in each year. Calculation Period each period of 12 months ending on a Calculation Date. Change in Law any present or future law, regulation, treaty, order or official directive or request (which, if not having the force of law, would be complied with by a responsible financial institution) which:

• 1 commences, is introduced, or changes, after the date of this deed; and

	2 does not relate to a change in the effective rate at which Tax is imposed on the overall net income
	of the Lender.
Collateral Security	any present or future Encumbrance, Guarantee or other document or agreement created or entered into
	by a Transaction Party or any other person as security for, or to credit enhance, the payment of any of
	the Outstanding Moneys.
Compliance Certificate	a certificate in the form of Schedule 3.
Contamination	in respect of a property, the presence of Pollutants:
	1 in, on or under the property; or
	2 in the ambient air and emanating from the property.
Contested Tax	a Tax payable by a Transaction Party where the Transaction Party is contesting its liability to pay that
	Tax, and has reasonable grounds to do so, having set aside adequate reserves of liquid assets to satisfy
	the liability if that contest is unsuccessful.

page 3

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1 <Definition and interpretation

Term Contingent Liability Control Controller Corporations Act Deed of Cross Guarantee Default Dispute Distribution Dollars,A$and$ EBITDA

Meaning

uncalled capital held by any member of the Sims Group in any corporation other than another member of the Sims Group and any other contingent liability under a Guarantee given by any member of the Sims Group to any person other than another member of the Sims Group. control as defined in section 50AA of the Corporations Act. a controller as defined in section 9 of the Corporations Act. the_Corporations Act 2001_(Cth). any deed entered into in connection with the granting by the Australian Securities & Investments Commission of an order pursuant to Part 2M.6 of the Corporations Act. 1 an Event of Default; or 2 a Potential Event of Default. has the meaning given in clause 17.3(d). any dividend, distribution or other amount declared or paid by a Transaction Party on any Marketable Securities issued by it. the lawful currency of the Commonwealth of Australia. for a relevant period and in respect of the Sims Group, the profit on ordinary activities before: 1 taxation;

• 2 Net Interest Expense; and

3 amortisation of intangible assets and depreciation of tangible assets of the Sims Group, as shown on a consolidated basis and as disclosed in the Sims Group’s most recent audited consolidated annual Financial Reports or semi-annual audited or unaudited consolidated Financial Reports, as applicable.

For the purposes of calculating EBITDA, the calculation will exclude:

• 1 any significant non-cash items or items disclosed as required by AASB 101.97 and AASB 101.98 due to their size or nature or by the corresponding provisions of future revisions of this accounting standard, that are of a non-recurring nature including but not limited to:

page 4

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1 <Definition and interpretation

Term

Meaning

• losses or gains on the sale or revaluation of assets,

• costs relating to restructuring and redundancy,

• discontinued operations,

• discounts on acquisition and gains on formation of joint ventures,

• post acquisition adjustments to contingent liabilities recorded on the date of a business acquisition pursuant to purchase accounting rule changes to be introduced on 1 July 2009, and

• costs associated with becoming Sarbanes-Oxley Act compliant (as required following the Sims Group’s registration as an issuer in the United States of America);

• 2 significant unrealized gains or losses;

• 3 any other significant non-cash items or items including but not limited to:

• write downs of inventory to net realisable value and

• forgone profit arising from sales contract negotiations; and

• 4 any impairment charge or loss (or gain or reversal) relating to the recoverable amount of assets (including any impairment charge relating to goodwill or identified intangible assets),

that are of a non-recurring nature.

The foregoing adjustments to EBITDA in paragraphs (1) to (3) for each Calculation Period will be agreed by the Lender and Sims in writing prior to the end of that Calculation Period, subject to the operation of clause 17.3.

Except for the purpose of calculating the ratio of Net Interest Expense to EBITDA under clause 4.17(a) (2), EBITDA as calculated on any Calculation Date will be adjusted to take into account the effects of any acquisitions or disposals of any company or business made during the Calculation Period ending on that Calculation Date. The adjustments will be made on the basis of the historical EBITDA of the company or business acquired or disposed of in the Calculation Period and ending on that Calculation Date by reference to historical EBITDA for the twelve months immediately preceding the Calculation Date and by reference to:

• 1 in the case of a disposal, the period of time during which the applicable company or business was part of the Sims Group; or

• 2 in the case of an acquisition, for that period being the twelve months immediately preceding the Calculation Date.

Encumbrance an interest or power:

• 1 reserved in or over an interest in any asset, including any retention of title; or

• 2 created or otherwise arising in or over any interest in any asset under a bill of sale, mortgage, charge, lien, pledge, trust or power,

by way of, or having similar commercial effect to, security for the payment of a debt, any other monetary obligation or the performance of

page 5

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1 <Definition and interpretation

Term Environmental Law Environmental Liability ERISA ERISA Affiliate Event of Default Excluded Tax

Meaning

any other obligation, and includes any agreement to grant or create any of the above. any legislation regulating Pollutants in connection with the protection of the environment or health and safety. any actual or potential Loss incurred or which may be incurred in connection with: 1 the investigation or remediation; 2 a claim by any third party; 3 any action, order, declaration or notice by a Government Agency under an Environmental Law; or 4 any agreement between a Transaction Party and any: • owner or occupier of land; or • Government Agency; of or in respect of Contamination of any Premises. the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations thereunder. all members of a controlled group of corporations and all trades and businesses (whether or not incorporated) under common control and all other entities which, together with an Undertaking Company and any Subsidiary are treated as a single employer under any or all of Sections 414(b), (c), (m) or (o) of the United States Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations thereunder. in respect of a Lender, any event specified in clause 5.1. a Tax imposed by any jurisdiction on the net income of the Lender but not a Tax: 1 calculated on or by reference to the gross amount of any payment (without allowance for any deduction) derived by the Lender under a Transaction Document or any other document referred to in a Transaction Document; or 2 imposed as a result of the Lender being considered a resident of or organised or doing business in that jurisdiction solely as a result of it being a party to a Transaction Document or any transaction contemplated by a Transaction Document.

Facility in respect of a Lender, any facility made available to a Borrower by that Lender pursuant to a Facility Agreement.

page 6

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1 <Definition and interpretation

Term Facility Agreement Financial Indebtedness

Meaning

1 in respect of the Original Lender, the facility agreement dated on or about the date of this deed between the Original Lender and the Original Borrowers; and 2 in respect of each New Lender, the agreement or instrument evidencing or containing the terms of Financial Indebtedness of a Borrower to the New Lender as described in the Lender Accession Deed for that New Lender, but does not include any Facility Agreement of a Retired Lender. any debt or other monetary liability in respect of moneys borrowed or raised or any financial accommodation including under or in respect of any:

• 1 Bill, bond, debenture, note or similar instrument;

• 2 acceptance, endorsement or discounting arrangement;

• 3 Guarantee;

• 4 finance or capital Lease;

• 5 agreement for the deferral for more than 90 days of a purchase price or other payment in relation to the acquisition of any asset or service;

• 6 obligation to deliver goods or provide services paid for in advance by any financier;

• 7 agreement for the payment of capital or premium on the redemption of any preference shares; or

• 8 interest or currency swap or hedge arrangement, financial option, futures contract or analogous transaction (the amount of such Financial Indebtedness being the marked to market value of the relevant transaction);

• 9 counter indemnity obligation in respect of a guarantee, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution,

and irrespective of whether the debt or liability:

• 10 is present or future;

• 11 is actual, prospective, contingent or otherwise;

• 12 is at any time ascertained or unascertained;

• 13 is owed or incurred alone or severally or jointly or both with any other person; or

• 14 comprises any combination of the above.

Financial Report in relation to an entity, the following financial statements and information in relation to the entity, prepared for its financial half year or financial year:

1 an income statement;

• 2 a balance sheet;

page 7

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1 <Definition and interpretation

• Term Meaning 3 a statement of changes in equity; and

• 4 a cash flow statement.

Fixed Charges for any period, with respect to the Sims Group, the sum of:

• 1 the aggregate amount of interest paid or accrued in respect of moneys borrowed or raised or in respect of any financial accommodation on a consolidated basis (including without limitation amortisation of original issue discounts on any such moneys or accommodation, commissions, discounts and facility, acceptance, usage and issuance and any other fees and charges with respect to any Guarantee, promissory note or acceptance or any discounting arrangements);

• 2 all but the principal component of rentals in respect of capitalised rent paid, accrued or scheduled to be paid or accrued on a consolidated basis during such period; and

• 3 dividends paid, accrued or scheduled to be paid or accrued on a consolidated basis in respect of shares or stock which are Financial Indebtedness during the relevant period.

in respect of a Lender, each date on which financial accommodation is provided, or is to be provided, to the Borrower under a Facility of that Lender.

• Funding Date in respect of a Lender, each date on which financial accommodation is provided, or is to be provided, to the Borrower under a Facility of that Lender.

• German Guarantor 1 for the purposes of clause 8 only, a Guarantor incorporated as a limited liability company (GmbH) under the laws of Germany; or

• 2 for all other purposes, a Guarantor which is incorporated in, resident in or whose principal area of business is in Germany.

Government Agency any government or any governmental, semi-governmental, administrative, fiscal or judicial body, department, commission, authority, tribunal, agency or entity. GST the goods and services tax levied under the GST Act. GST Act the A New Tax System (Goods and Services Tax) Act 1999 (Cth). Guarantee any guarantee, suretyship, letter of credit, letter of comfort or any other obligation:

• 1 to provide funds (whether by the advance or payment of money, the purchase of or subscription for shares or other securities, the purchase of assets or services, or otherwise) for the payment or discharge of;

• 2 to indemnify any person against the consequences of default in the payment of; or

page 8

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1 <Definition and interpretation

Term Guaranteed Share Guarantor Hedging Agreement Insolvent

Meaning

3 to be responsible for, any debt or monetary liability of another person or the assumption of any responsibility or obligation in respect of the insolvency or the financial condition of any other person. any share or stock issued by a member of the Sims Group where redemption of such share or stock or the payment of capital or dividends on such share or stock is the subject of a Guarantee of a member of the Sims Group or a Guarantee of another person who will have recourse in respect of its liability under that Guarantee directly or indirectly to a member of the Sims Group or its assets (other than as a shareholder). 1 each Original Guarantor; and 2 each Additional Guarantor. each interest rate, foreign exchange transaction, equity or equity index option, bond option, commodity swap, commodity option, cap transaction, currency swap transaction, cross-currency swap rate transaction or any other hedge or derivative agreement entered into by a Transaction Party, including any master agreement and any transaction or confirmation under it. an entity is Insolvent if:

• 1 it is (or states that it is) an insolvent under administration or insolvent (each as defined in the Corporations Act); or

• 2 it is in liquidation, in provisional liquidation, under administration or wound up or has had a Controller appointed to its property; or

• 3 it is subject to any arrangement, assignment, moratorium or composition, protected from creditors under any statute or dissolved (in each case, other than to carry out a reconstruction or amalgamation while solvent which does not have, or is not likely to have, a Material Adverse Effect); or

• 4 an application or order has been made (and, in the case of an application, it is not stayed, withdrawn or dismissed within 14 days), resolution passed, proposal put forward, or any other action taken, in each case in connection with that person, which is preparatory to or could result in any of (1), (2) or (3) above; or

• 5 it is taken (under section 459F(1) of the Corporations Act) to have failed to comply with a statutory demand; or

• 6 it is the subject of an event described in section 459C(2)(b) or section 585 of the Corporations Act (or it makes a statement from which the Bank reasonably deduces it is so subject); or

• 7 it is otherwise unable to pay its debts when they fall due; or

• 8 something having a substantially similar effect to (1) to (7) happens in connection with that entity under the law of any jurisdiction.

page 9

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1 <Definition and interpretation

Term Intangible Assets Issue Latest Audited Consolidated Balance Sheet Lease Lender

Meaning

include all goodwill, copyright, patents, trade marks and licences, research and development, future income tax benefit, underwriting and formation expenses and other items of a like nature which according to current accounting practices are regarded as unidentifiable and intangible assets. any dispute (other than a dispute that is frivolous or vexatious) between Sims and the Lender as to the calculation of the adjustments to be made in accordance with paragraphs (1) to (4) of the definition of EBITDA in clause 1.1. at any time, the most recently prepared audited consolidated balance sheet of the Sims Group, or if a half yearly unaudited balance sheet has been prepared more recently, that half yearly balance sheet. a lease, charter, hire purchase, hiring agreement or any other agreement under which any property is or may be used or operated by a person other than the owner. severally:

• 1 the Original Lender; and

• 2 any New Lender,

other than a Retired Lender.

Lender Accession Deed an accession deed in the form of Attachment 2. Lending Office 1 in respect of the Original Lender, the office of the Original Lender set out in Schedule 1; and

• 2 in respect of each other Lender, the office of that Lender set out in its Accession Deed, or any other office notified by the Lender under this deed.

Loss any claim, action, damage, loss, liability, cost, charge, expense, outgoing or payment.

Marketable Securities marketable securities as defined in section 9 of the Corporations Act. Material Adverse Effect in respect of a Lender, a material adverse effect on:

• 1 the financial condition of the Transaction Parties (taken as a whole);

• 2 any Transaction Party’s ability to perform any of its obligations under any Transaction Document of that Lender;

page 10

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1 <Definition and interpretation

Term Net Interest Expense New Lender Officer Other Facility Document Outstanding Moneys

Meaning

3 the validity or enforceability of the whole or any material part of a Transaction Document or any material rights or remedies of a Lender under the Transaction Documents of that Lender; or 4 any Encumbrance provided to that Lender by a Transaction Party. for any period, the aggregate (without double counting) of all interest paid or accrued during that period in respect of any Financial Indebtedness of the Sims Group (including any fees and charges with respect to any guarantee, indemnity or letter of credit or under any bill of exchange, promissory note or any other acceptance or discounting arrangement and any finance charges paid or payable under any hire purchase agreement or lease agreement for which a member of the Sims Group is actually or contingently liable) less any interest income of the Sims Group during that period. a person who has executed a Lender Accession Deed in accordance with clause 14. 1 in relation to a Transaction Party, a director or a secretary, or a person notified to be an authorised officer, of the Transaction Party; 2 in relation to a Lender, any person whose title includes the word ‘Director’, ‘Managing Director’, ‘Manager’ or ‘Vice President’, and any other person appointed by the Lender to act as its authorised officer for the purposes of this deed. in respect of a Lender, any agreement that any Relevant Company has entered into or will enter into in connection with the provision to a member of the Sims Group of financial accommodation or under which a member of the Sims Group incurs or may incur Financial Indebtedness other than a Transaction Document of that Lender. in respect of a Lender, all debts and monetary liabilities of each Transaction Party to the Lender under or in relation to any Transaction Document and in any capacity, irrespective of whether the debts or liabilities:

• 1 are present or future;

• 2 are actual, prospective, contingent or otherwise;

3 are at any time ascertained or unascertained;

• 4 are owed or incurred by or on account of any Transaction Party alone, or severally or jointly with any other person;

• 5 are owed to or incurred for the account of the Lender alone, or severally or jointly with any other person;

6 are owed to any other person as agent (whether disclosed or not) for or on behalf of the Lender;

• 7 are owed or incurred as principal, interest, fees, charges, taxes, duties or other imposts, damages (whether for breach of contract or

page 11

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1 <Definition and interpretation

Term Payment Currency Permitted Encumbrance Permitted Financial Accommodation Pollutant Potential Event of Default

Meaning

tort or incurred on any other ground), losses, costs or expenses, or on any other account; 8 are owed to or incurred for the account of the Lender directly or as a result of: • the assignment or transfer to the Lender of any debt or liability of any Transaction Party (whether by way of assignment, transfer or otherwise); or • any other dealing with any such debt or liability; 9 are owed to or incurred for the account of the Lender before the date of this deed, or before the date of any assignment of this deed to the Lender by any other person or otherwise; or 10 comprise any combination of the above. the currency in which any payment is actually made. 1 A lien or statutory charge which arises by operation of law in the ordinary course of day to day business and does not secure Financial Indebtedness, but only so long as the amount secured is paid on the due date, except where that amount is being contested in good faith; and 2 Encumbrances that at any time secure an amount of secured liabilities of entities within the Sims Group not exceeding in aggregate an amount equal to 5% of Total Tangible Assets at that time, which affects or relates to any of the assets of any Transaction Party. any financial accommodation provided by a Transaction Party: 1 under the Transaction Documents; 2 to another Transaction Party; 3 in the form of deposits held with financial institutions in the ordinary course of business and supplier advances for which security adequate to cover the amount of the supplier advance is taken; or 4 to parties other than other Transaction Parties which when added to all such other outstanding accommodation provided by all Relevant Companies does not exceed A$35,000,000. a pollutant, contaminant, dangerous, toxic or hazardous substance, petroleum or petroleum product, chemical, solid, special liquid, industrial or other waste. in respect of a Lender, any thing which would become an Event of Default on the giving of notice (whether or not notice is actually given), the expiry of time or any combination of the above.

page 12

	Term Power Premises Principal Outstanding Reference Bank Related Body Corporate Relevant Currency Relevant Company Retired Lender Review Event Same Day Funds Selection Date Sims Group Subsidiary	1 <Definition and interpratation Meaning
		any right, power, authority, discretion or remedy conferred on the Lender or an Attorney by any Transaction Document or any applicable law. any property owned or occupied by a Transaction Party or which is used by a Transaction Party to carry on any activities. at any time in respect of a Lender, the aggregate principal amount of all Financial Indebtedness outstanding under the Transaction Documents of that Lender at that time. 1 Commonwealth Bank of Australia; 2 Westpac Banking Corporation; 3 Australia and New Zealand Banking Group Limited; and 4 National Australia Bank Limited, or such other person as the Lender and the Borrower may agree. a related body corporate as defined in section 50 of the Corporations Act. the currency in which a payment is required to be made under the relevant Transaction Document and, if not expressly stated to be another currency, is Dollars. any Transaction Party or any Subsidiary of any of them. a Lender which has been released under clause 14.2. in respect of a Lender, any event specified in clause 6(a) in respect of that Lender. immediately available and freely transferable funds. the last day of an Interest Period. Sims and its Subsidiaries. a subsidiary as defined in section 46 of the Corporations Act.

page 13

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1 <Definition and interpratation

Term Meaning Tangible Assets all assets other than Intangible Assets. Tangible Net Worth at any time, Total Tangible Assets less:

• Total Indebtedness; and

• aggregate Intangible Assets of the Sims Group.

• Tax 1 any tax including the GST, levy, charge, impost, duty, fee, deduction, compulsory loan or withholding; or

• 2 any income, stamp or transaction duty, tax or charge,

which is assessed, levied, imposed or collected by any Government Agency and includes any interest, fine, penalty, charge, fee or other amount imposed on or in respect of any of the above.

Tax Act the Income Tax Assessment Act 1936 (Cth) or the Income Tax Assessment Act 1997 (Cth) as applicable. Tax Invoice includes any document or record treated by the Commissioner of Taxation as a tax invoice or as a document entitling a recipient to an input tax credit. Total Indebtedness at any time the aggregate amount (as disclosed by the Latest Audited Consolidated Balance Sheet) of all secured and unsecured liabilities of the Sims Group together with, unless already included in the Latest Audited Consolidated Balance Sheet:

• 1 the aggregate amount (as disclosed by its latest audited balance sheet) of all secured and unsecured liabilities of any entity which has become a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet and all other amounts which would be included in this definition if references to the Latest Audited Consolidated Balance Sheet were to be to the latest audited balance sheet of that entity;

• 2 the unrepaid principal (or its equivalent) of any Financial Indebtedness where the proceeds or benefits of that Financial Indebtedness:

• have been received by any member of the Sims Group, since the date of the Latest Audited Consolidated Balance Sheet, excluding the amount of any such proceeds which have been applied in reduction of any secured or unsecured liabilities included in this definition; or

• are to be received by any member of the Sims Group and the receipt of such proceeds or benefits has been underwritten or otherwise assured to the satisfaction of the auditor of the Sims Group;

• 3 the paid up capital amount and accrued but unpaid dividends of Guaranteed Shares;

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Term

Meaning

1 <Definition and interpratation

and after:

4 deducting:

• the aggregate amount of all secured and unsecured liabilities of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet and in respect of which no other member of the Sims Group has any liability; and

• the aggregate amount of all liabilities which in the opinion of the auditor of the Sims Group have been defeased in such a way as to enable any such liability to be considered as having been extinguished within the meaning of paragraph 30 of Australian Accounting Standard AAS23; and

• debt reductions of the type referred to in the third bullet point of paragraph 2 of the definition of “Total Tangible Assets”;

• 5 eliminating all inter-entity balances among the members of the Sims Group or any of them (including any member of the Sims Group which has become one since the date of the Latest Audited Consolidated Balance Sheet); and

• 6 making such further adjustments (including elimination of any double counting arising in relation to any Guarantee and the obligation or indebtedness that is the subject of the Guarantee) which in the opinion of the auditor of the Sims Group are appropriate to make a proper determination of the total amount of the aggregate indebtedness of the members of the Sims Group.

In this definition references to “secured and unsecured liabilities” shall include (without limiting the generality of the expression) all Financial Indebtedness and provisions for estimated liabilities for income taxes, long service leave and dividends recommended, declared or accrued but unpaid and provisions for any Contingent Liability but shall not include paid up share capital (other than Guaranteed Shares), reserves of any nature or undistributed profits.

Total Tangible Assets

at any time the aggregate of the book values, as disclosed by the Latest Audited Consolidated Balance Sheet, of all Tangible Assets of the Sims Group and of such Intangible Assets of the Sims Group as the Lender in its sole and absolute discretion may from time to time agree, together with, (unless already included in the Latest Audited Consolidated Balance Sheet):

• 1 the aggregate (as disclosed by its latest audited balance sheet) of the book value of the Tangible Assets as determined by the auditor of the Sims Group (after making provisions for depreciation and bad and doubtful debts and any income yet to mature) of any entity which has become a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet;

• 2 the aggregate proceeds of:

• any issue of shares or stock (including premium) of any member of the Sims Group received since the balance date of the latest Audited Consolidated Balance Sheet; and

• the aggregate proceeds of any calls on partly paid shares made by any member of the Sims Group which have been received

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Term

Meaning

1 <Definition and interpratation

since the balance date of the Latest Audited Consolidated Balance Sheet,

  - excluding the amount of any such proceeds which:

• have been applied in reduction of any secured or unsecured liabilities included in the definition of “Total Indebtedness”; or

• have been applied in acquiring any assets included in Total Tangible Assets under this definition;

• 3 the book value of any Tangible Assets (not excluded as provided below) acquired since the date of the Latest Audited Consolidated Balance Sheet by any member of the Sims Group with the proceeds of the sale of shares or units in any entity which has ceased to be a member of the Sims Group since that date;

• 4 the book value of all assets which are or may be leased, chartered, hired, managed, used or operated under a finance lease (where the capitalised rent has been included in Total Indebtedness) as determined by the auditor of the Sims Group at least annually or (at the option of Sims) the value as at the date of calculation as assessed by a qualified independent valuer chosen by Sims and approved by the Lender);

• 5 the proceeds of any Financial Indebtedness referred to in paragraph 2 of the definition of “Total Indebtedness” excluding the amount of any proceeds which:

• have been applied in reduction of any other secured or unsecured liabilities included in that definition; or

• have been applied in acquiring any assets included in Total Tangible Assets under this definition;

• 6 (if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent valuer approved by the Lender), the excess (if any) of the fair value of that Tangible Asset as established by the valuer over its book value (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of that entity) and as accepted by the auditor of the Sims Group without qualification;

and after deducting:

• 7 the amount of any income yet to mature and the amount of provisions for depreciation and for bad and doubtful debts as disclosed by the Latest Audited Consolidated Balance Sheet;

• 8 the aggregate (as disclosed by the latest audited balance sheet of the relevant entity) of the book values of the Tangible Assets of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet, other than Tangible Assets of that entity which have become assets of another member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph 6, the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value);

• 9 the book value of any Tangible Assets of any member of the Sims

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1 <Definition and interpratation

Term

• Meaning Group which have been applied since the date of the Latest Audited Consolidated Balance Sheet in the acquisition of any entity which has become a member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph 6, the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value); and

• 10 if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent valuer (whether at the request of the Lender or otherwise), the excess (if any) of the book value of that Tangible Asset (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of that entity) over its fair value as established by the valuer and as accepted by the auditor of the Sims Group without qualification;

and after:

• 11 eliminating all inter-entity balances among any of the members of the Sims Group (including any member of the Sims Group which has become such since the Latest Audited Consolidated Balance Sheet); and

• 12 making such further adjustments as may properly be necessary to avoid any double counting of assets or as may be required by the auditor of the Sims Group to enable a proper determination to be made of the total amount of the Total Tangible Assets.

Transaction Document in respect of a Lender:

• 1 this deed;

• 2 each Accession Deed;

• 3 each Lender Accession Deed;

• 4 each Hedging Agreement for that Lender;

• 5 the Facility Agreement for that Lender;

• 6 any other document which Sims acknowledges in writing to be a Transaction Document for that Lender;

• 7 any other document or agreement to which a Transaction Party is or becomes a party with that Lender or under which obligations are owed by a Transaction Party to that Lender,

or any document or agreement entered into or given under or for the purpose of amending any of the above and in each case whether or not other parties are involved and whether or not it arises as a result of an assignment or transfer.

• Transaction Party 1 each Borrower; and

• 2 each Guarantor.

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1 <Definitions and interpretation

1.3 Interpretation

• In this deed headings and bold type are for convenience only and do not affect the interpretation of this deed and, unless the context requires otherwise:

• (a) words importing the singular include the plural and vice versa;

• (b) words importing a gender include any gender;

• (c) other parts of speech and grammatical forms of a word or phrase defined in this deed have a corresponding meaning;

• (d) an expression suggesting or referring to a natural person or an entity includes any company, partnership, joint venture, association, corporation or other body corporate and any Government Agency;

• (e) a reference to any thing (including any right) includes a part of that thing but nothing in this clause 1.3(e) implies that performance of part of an obligation constitutes performance of the obligation;

• (f) a reference to a clause, party, attachment, exhibit or schedule is a reference to a clause of, and a party, attachment, exhibit and schedule to, this deed and a reference to this deed includes any attachment, exhibit and schedule;

• (g) a reference to a statute, regulation, proclamation, ordinance or by-law includes all statutes, regulations, proclamations, ordinances or by-laws amending, consolidating or replacing it, whether passed by the same or another Government Agency with legal power to do so, and a reference to a statute includes all regulations, proclamations, ordinances and by-laws issued under that statute;

• (h) a reference to a document includes all amendments or supplements to, or replacements or novations of, that document;

• (i) a reference to liquidation includes official management, appointment of an administrator, compromise, arrangement, merger, amalgamation, reconstruction, winding up, dissolution, deregistration, assignment for the benefit of creditors, scheme, composition or arrangement with creditors, insolvency, bankruptcy, or a similar procedure or, where applicable, changes in the constitution of any partnership or person, or death;

• (j) a reference to a party to any document includes that party’s successors and permitted assigns;

• (k) a reference to an agreement other than this deed includes an undertaking, deed, agreement or legally enforceable arrangement or understanding whether or not in writing;

• (l) a reference to an asset includes all property of any nature, including a business, and all rights, revenues and benefits;

• (m) a reference to a document includes any agreement in writing, or any certificate, notice, deed, instrument or other document of any kind;

• (n) no provision of this deed may be construed adversely to a party solely on the ground that the party was responsible for the preparation of this deed or that provision;

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1 <Definitions and interpretation

• (o) a reference to drawing, accepting, endorsing or other dealing with a Bill refers to drawing, accepting, endorsing or dealing within the meaning of the Bills of Exchange Act 1909 (Cth);

• (p) a reference to a body, other than a party to this deed (including an institute, association or authority), whether statutory or not:

• (1) which ceases to exist; or

• (2) whose powers or functions are transferred to another body,

is a reference to the body which replaces it or which substantially succeeds to its powers or functions;

• (q) a Default “subsists” or “continues” if it has not been waived by, or remedied to the satisfaction of, the Lender; and

• (r) references to time are to Sydney time.

1.4 Inclusive expressions

Specifying anything in this deed after the words ‘include’ or ‘for example’ or similar expressions does not limit what else is included unless there is express wording to the contrary.

1.5 Business Day

Except where clause 9.2 applies, where the day on or by which any thing is to be done is not a Business Day, that thing must be done on or by the preceding Business Day.

1.6 Accounting Standards

• (a) Any accounting practice or concept relevant to this deed is to be construed or determined in accordance with the Accounting Standards.

• (b) Each Lender and Transaction Party acknowledges that changes in the Accounting Standards after the date of this deed may make the operation of the undertakings set out in clause 4.17 or 4.18, a defined term or another clause in a Transaction Document that refers to the Accounting Standards or any accounting practice or concept, inappropriate.

• (c) If Sims or a Lender considers that such a change has occurred and notifies the Lenders or Sims (as applicable) to that effect (the date such notice is given, the Notification Date ), Sims and the Lenders agree to negotiate in good faith to agree to appropriate amendments to the affected clause or definition.

• (d) If Sims and the Lenders fail to agree on amendments to the affected clause or definition within 20 Business Days (or such other period as may be agreed between Sims and the Lenders) of the Notification Date, then any references to the Accounting Standards in this deed or any other Transaction Document will be deemed to be a reference to the Accounting Standards as at the date of this deed.

• (e) Unless and until an agreement is reached as contemplated in this clause 1.6, the Borrowers will provide each Financial Report and Compliance Certificate

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2 Operation of Common Terms

together with, in each case, any reconciliation statements (audited, where applicable) necessary to enable calculation of the financial undertakings and associated definitions based on the Accounting Standards prior to the relevant change occurring and those changes will be ignored for the purposes of the financial undertakings and the relevant definitions.

• 2 Operation of Common Terms

• 2.1 Several obligations and rights of Lenders

The parties acknowledge that each Lender contracts with the Transaction Parties on an independent and individual basis and accordingly:

• (a) no relationship arises between the Lenders;

• (b) the obligations and rights of the Lenders under each Transaction Document are several;

• (c) failure of a Lender to perform its obligations under a Transaction Document does not relieve any other Lender from any of its obligations under a Transaction Document;

• (d) no Lender is responsible for the obligations of any other Lender under a Transaction Document; and

• (e) each Lender may separately enforce its rights under any Transaction Document.

• 2.2 Terms of Transaction Documents

• (a) Each Transaction Party and Lender agree that the terms of this deed are incorporated in the Facility Agreement for that Lender.

• (b) If there is any inconsistency between the terms of this deed and the terms of the Transaction Documents of a Lender, as between the Transaction Parties and that Lender the terms of the Transaction Documents for that Lender will prevail to the extent of the inconsistency.

• (c) Sims will promptly notify a Lender ( First Lender ) if, in the reasonable opinion of Sims, the terms of a Facility provided by the First Lender (other than those terms related to pricing (including fees and margins), facility limits and repayment dates) are or become less favourable to the First Lender in any material respect than the terms of a Facility provided by any other Lender (the Other Lender ) (including the granting of an Encumbrance to any party other than pursuant to an Encumbrance permitted by the terms of the First Lender’s Facility). Upon request from the First Lender, the Transaction Parties will amend the Facility Agreement or Transaction Documents of the First Lender to provide for the same or substantially similar terms and conditions to apply to the First Lender.

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3 Representations and warranties

• 3 Representations and warranties

• 3.1 Representations and warranties

• Each Transaction Party represents and warrants to and for the benefit of each Lender that:

• (a) registration : it and each Relevant Company is a corporation, or in the case of a Relevant Company incorporated or organised under the laws of a state in the United States of America, a corporation, limited liability company or limited partnership (or other form of entity as may be notified by Sims to the Lenders) or in the case of a Relevant Company incorporated or organised under the laws of Germany a limited liability company, duly incorporated or organised in accordance with the laws of its place of incorporation or organisation, is validly existing under those laws and is capable of suing and being sued;

• (b) corporate power : it has the corporate power to own its assets and to carry on its business as it is now being conducted;

• (c) authority : it has power and authority to enter into and perform its obligations under the Transaction Documents of that Lender to which it is expressed to be a party;

• (d) authorisations : it has taken all necessary action to authorise the execution, delivery and performance of the Transaction Documents of that Lender to which it is expressed to be a party;

• (e) binding obligations : the Transaction Documents of that Lender to which it is expressed to be a party constitute its legal, valid and binding obligations and are enforceable in accordance with their terms;

• (f) transaction permitted : the execution, delivery and performance by it of the Transaction Documents of that Lender to which it is expressed to be a party will not breach, or result in a contravention of:

  • (1) any law, regulation or Authorisation;

  • (2) its constitution or other constituent documents;

  • (3) any limitation on its powers or the powers of its directors; or

  • (4) any Encumbrance or agreement which is binding on it or any of its Subsidiaries,

    • and will not result in:

  • (5) the creation or imposition of any Encumbrance on any assets of it or any of its Subsidiaries other than as permitted under a Transaction Document of that Lender; or

  • (6) the acceleration of the date for payment of any obligation under any agreement which is binding on it;

• (g) No filing or stamp taxes : under the law of any relevant jurisdiction it is not necessary that the Transaction Documents of that Lender be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp

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3 Representations and warranties

duty, registration or other similar Tax be paid on or in relation to the Transaction Documents of that Lender or the transactions contemplated by those Transaction Documents;

• (h) Authorisations : all Authorisations required:

• (1) to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Transaction Documents of that Lender to which it is a party;

• (2) to make the Transaction Documents of that Lender to which it is a party admissible in evidence in its jurisdiction of incorporation or organisation; and

• (3) for each Transaction Party to carry on its business, which are material and where failure to do so would have a Material Adverse Effect,

• have been obtained or effected and are in full force and effect;

• (i) default under law : neither it nor any of its Subsidiaries is in breach of a law or obligation affecting any of them or their assets in a way which has had, or is likely to have, a Material Adverse Effect;

• (j) Environment Law :

• (1) there is and has been nothing relating to it or its business or assets which under any Environmental Law or law relating to health and safety has given rise or may give rise to substantial expenditure by it, a substantial claim against it or a requirement that it cease or substantially alter a material activity; and

• (2) other than those Authorisations which a failure to obtain or maintain is not likely to have a Material Adverse Effect, it has obtained all Authorisations it is required to obtain under any Environmental Laws and such Authorisations are in full force and effect;

• (k) taxation : to the best of its knowledge, information and belief, having made due enquiries, it has complied with all material laws relating to Tax in all jurisdictions in which it is subject to Tax and has paid all Taxes due and payable by it (other than those Taxes which it is contesting in good faith and in respect of which it has made adequate reserves as long as failure to pay those Taxes would not have, and is not reasonably likely to have, a Material Adverse Effect);

• (l) pari passu : its payment obligations under the Transaction Documents of that Lender rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally;

• (m) no immunity : neither it nor any of its Subsidiaries has immunity from the jurisdiction of a court or from legal process;

• (n) Governing law and enforcement : subject to any qualification in any legal opinion provided to that Lender pursuant to the Transaction Documents of that Lender relating to it or the laws of its jurisdiction:

• (1) the choice of law referred to in clause 17.5 as the governing law of the Transaction Documents of that Lender will be recognised and

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3 Representations and warranties

  - enforced in its jurisdiction of incorporation or organisation and in the jurisdiction referred to in that clause (if different); and

• (2) any judgment obtained against it in any jurisdiction referred to in clause 17.5 in relation to a Transaction Document of that Lender will be recognised and enforced in its jurisdiction of incorporation or organisation;

• (o) not a trustee : it does not enter into any Transaction Document of that Lender as trustee of any trust or settlement;

• (p) legal and beneficial owner : it is the legal and beneficial owner of its assets and undertaking;

• (q) no Encumbrances or other interests : there is no Encumbrance over any of its assets or undertaking other than a Permitted Encumbrance;

• (r) commercial benefit : the entering into and performance by it of its obligations under the Transaction Documents of that Lender to which it is expressed to be a party is for its commercial benefit and is in its commercial interests;

• (s) solvency : there are no reasonable grounds to suspect that it is unable to pay its debts as and when they become due and payable;

• (t) no benefit to related party or financial assistance : no person has contravened nor will contravene section 208, section 209 or Part 2J.3 of the Corporations Act (or similar laws under the laws of any other jurisdiction which may be applicable to it) by entering into any Transaction Document of that Lender or participating in any transaction in connection with a Transaction Document of that Lender;

• (u) financial information : its most recent Financial Reports or accounts which it has provided to the Lender under clause 4.1:

• (1) give a true and fair view of the financial condition and state of affairs of it and its Subsidiaries as at the date they were prepared and disclose all material Financial Indebtedness and material contingent liabilities; and

• (2) were prepared in accordance with the Accounting Standards (except to the extent expressly disclosed in them) and all applicable laws;

• (v) no change in affairs : there has been no change in its or any of its Subsidiaries’ state of affairs since the end of the accounting period for its most recent Financial Reports or accounts, referred to in clause 3.1(u) which has had or is likely to have a Material Adverse Effect;

• (w) disclosure : all information provided to the Lender by or on its behalf in relation to it, its assets, business or affairs or the Transaction Documents was correct and not misleading (by omission or otherwise) as at the time it was provided;

• (x) full disclosure : it has disclosed in writing to the Lender all facts relating to it and its Subsidiaries, the Transactions Documents of that Lender and all things in connection with them, which are material to the assessment of the nature and amount of the risk undertaken by the Lender in entering into the Transaction Documents of that Lender and doing anything in connection with them;

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3 Representations and warranties

• (y) Litigation : no litigation, tax claim, dispute arbitration, administrative proceeding or other similar proceeding is presently current or pending or, to a Relevant Company’s knowledge, threatened, which might have a Material Adverse Effect;

• (z) representations true : each of its representations and warranties contained in the Transaction Documents is correct and not misleading when made or repeated;

• (aa) no Default :

  • (1) there is no subsisting Event of Default; and

  • (2) to the best of its knowledge, there is no subsisting Potential Event of Default;

• (bb) “most favoured nation” : in the reasonable opinion of Sims, the terms of each Facility (other than those terms related to pricing (including fees and margins, facility limits, repayment dates and in the case of hedging pricing and individual transaction amounts) are no less favourable in any material respect than the terms in any Other Facility Document;

• (cc) ERISA : each Transaction Party incorporated or organised in the United States of America and each of its Subsidiaries (each a Sims US Company ) has operated and administered each employee benefit plan (as defined in Section 3 of ERISA) in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and could not reasonably be expected to result in a Material Adverse Effect. No Sims US Company has incurred any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the U.S. Internal Revenue Code relating to employee benefit plans (as defined in Section 3 of ERISA), and no event, transaction or condition has occurred or exists that would reasonably be expected to result in the incurrence of any such liability by a Sims US Company, or in the imposition of any lien on any of the rights, properties or assets of a Sims US Company, in either case pursuant to Title I or IV of ERISA or to such penalty or excise tax provisions or to Section 401(a)(29) or 412 of the U.S. Internal Revenue Code, other than such liabilities or liens as would not individually or in the aggregate reasonably be expected to result in respect of each Sims US Company in a Material Adverse Effect;

• (dd) Federal Reserve Regulations : No Transaction Party is engaged principally, nor as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System). No part of the proceeds of the loan will be used, whether immediately, incidentally or ultimately, for purchasing or carrying any “margin security” or “margin stock” as such terms are used in Regulations U and X of the Board of Governors of the Federal Reserve System; and

• (ee) Not an Investment Company : No Transaction Party is, nor during the term of the loan will it be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

• 3.2 Survival and repetition of representations and warranties

The representations and warranties given under this deed:

• (a) survive the execution of each Transaction Document; and

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• (b) are repeated on each date on which financial accommodation is made available under a Transaction Document, each Interest Payment Date (as defined in the relevant Transaction Document) and each day on which a person becomes an Additional Borrower or Additional Guarantor, in each case with respect to the facts and circumstances then subsisting.

3.3 Reliance by Lender

Each Transaction Party acknowledges that each Lender has entered into each Transaction Document to which it is a party in reliance on the representations and warranties given under this deed.

• 4 Undertakings

• 4.1 Provision of information and reports

• Each Transaction Party must provide to each Lender the following:

• (a) Annual Financial Reports : as soon as practicable and in any event no later than 90 days after the end of each financial year, copies of the annual audited Financial Report of the Sims Group for that financial year (delivery of Financial Reports under this clause by Sims will be deemed to satisfy each other Transaction Party’s obligation under this paragraph);

• (b) Half-year Financial Reports : as soon as practicable and in any event no later than 90 days after the end of the first half of each financial year, copies of the unaudited semi-annual Financial Report of the Sims Group for that half financial year (delivery of Financial Reports under this clause by Sims will be deemed to satisfy each other Transaction Party’s obligation under this paragraph);

• (c) Compliance Certificate : together with the documents provided under clauses 4.1(a) and (b), a Compliance Certificate;

• (d) directors’ certificate : at the Lender’s request, a certificate signed by at least 2 directors of Sims stating:

  • (1) if a Default has occurred; and

  • (2) if so, full details of the relevant Default and the remedial action being taken or proposed;

• (e) documents issued : copies of all documents issued by it to holders of its Marketable Securities at the same time as their issue;

• (f) KYC & AML : promptly upon request, any document or information necessary in the Lender’s opinion to enable the Lender to undertake any know your customer checks or anti-money laundering checks; and

• (g) other information : any other information which the Lender reasonably requests.

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4.2 Proper accounts

• Each Transaction Party must:

• (a) keep accounting records which give a true and fair view of its financial condition and state of affairs; and

• (b) ensure that the accounts it provides under clause 4.1 are prepared in accordance with the Accounting Standards.

4.3 Notices to the Lender

• Each Transaction Party must notify the Lender as soon as it becomes aware of:

• (a) any Default occurring, together with full details of the Default and any step taken or proposed to remedy it;

• (b) any breach of any Environmental Law or the issuing of any proceedings or notice or requirements against or upon it or its assets in respect of, or which is likely to result in, any Environmental Liability or breach of any Environmental Law in each case, which has had, or is reasonably likely to have a Material Adverse Effect;

• (c) any litigation, arbitration, administrative or other proceeding in respect of it or any of its assets being commenced or threatened which is in excess of $25,000,000 or its equivalent.

• (d) any proposal of any Government Agency to compulsorily acquire the whole or a substantial part of its assets; and

• (e) the acquisition by it of a Subsidiary.

• 4.4 Compliance

Each Transaction Party must, and Sims must ensure that each other member of the Sims Group will:

• (a) comply with all its obligations under each Transaction Document to which it is a party; and

• (b) ensure that no Event of Default occurs.

4.5 Maintenance of capital

Each Transaction Party will ensure that no Relevant Company takes any action to reduce its capital, cancel its uncalled capital or buy back its shares ( Capital Reduction ) if the Capital Reduction would, in aggregate with any other Capital Reductions by the Relevant Company in the preceding year, result in a reduction of the issued ordinary capital of the Relevant Company of greater than or equal to 10% for that year (however any Capital Reduction may not in any event be made if it causes a breach of the undertakings contained in clauses 4.17 or 4.18).

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4.6 Compliance with laws and Authorisations

• Each Transaction Party must and must ensure that each Relevant Company will:

• (a) comply with all laws and legal requirements, including each judgement, award, decision, finding or any other determination of a Government Agency, which applies to it or any of its assets, where failure to do so will have or be likely to have a Material Adverse Effect;

• (b) obtain, maintain and comply with:

• (1) all authorisations required in relation to the entry into, performance of obligations under, and enforceability of, each Transaction Document to which it is a party; and

• (2) all authorisations that are material to the carrying on of the business of the Sims Group (taken as a whole) where failure to do so has or is likely to have a Material Adverse Effect,

and ensure those Authorisations are not cancelled, suspended, not renewed, varied or found to be invalid; and

• (c) not do anything which would prevent the renewal of any Authorisation referred to in clause 4.6(b) or cause it to be renewed on less favourable terms.

• 4.7 Payment of Taxes and outgoings

• (a) Each Transaction Party must pay all Taxes when due, other than:

  • (1) Contested Taxes; and

  • (2) where failure to do so will not have or be likely to have a Material Adverse Effect.

• (b) Each Transaction Party must pay all Contested Taxes when the terms of any final determination or settlement require those Contested Taxes to be paid.

4.8 Conduct of business

• Each Transaction Party must conduct its business (including collecting debts owed to it) in a proper, orderly and efficient manner.

• 4.9 Maintenance of existence

• A Transaction Party must, and must ensure that each Relevant Company will:

• (a) maintain its corporate existence, good standing and registration in the jurisdiction of its organisation or incorporation;

• (b) not transfer its jurisdiction of organisation or incorporation;

• (c) not enter into any amalgamation, demerger or corporate reconstruction where such event has or would be likely to have a Material Adverse Effect except a solvent amalgamation or reconstruction on terms agreed by the Lender; and

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4 Undertakings

• (d) not amend its constitution or any other constituent document of it where such amendment has or would be likely to have a Material Adverse Effect, without the Lender’s prior written consent.

4.10 Negative pledge

• (a) A Transaction Party must not, and Sims must procure that no other member of the Sims Group will, create or allow to exist or agree to any Encumbrance over any of its assets other than a Permitted Encumbrance.

• (b) No Transaction Party will deposit money with a person in circumstances where the money is not repayable unless the Transaction Party performs obligations (including to pay money) to that person, except in respect of deposits which in aggregate do not exceed A$35,000,000 at any time.

• (c) A Transaction Party must not, and each Transaction Party must ensure that no Relevant Company will, dispose of 10% or more of its Total Tangible Assets or an interest in them or agree or attempt to do so (whether in one or more related or unrelated transactions) except:

• (1) where the disposals are in the ordinary course of day to day trading; and

• (2) the disposals are of obsolete assets no longer required for its business.

• (d) A Transaction Party must not enter into any arrangement which, if complied with, would prevent any Transaction Party from complying with its obligations under the Transaction Documents.

• (e) This clause 4.10 does not apply to the creation of an Encumbrance or disposal of an asset if such creation or disposal cannot be prohibited by reason of Section 1136 German Civil Code ( Bürgerliches Gesetzbuch ).

4.11 No change to business

The Relevant Companies will not substantially change the nature of the business or businesses carried on by them as a whole. No Relevant Company will take any action which would have that effect, whether by disposal, acquisition or otherwise.

4.12 Financial accommodation

• (a) A Transaction Party must not provide any financial accommodation, or give any Guarantee in respect of any financial accommodation other than financial accommodation provided to a Transaction Party, to or for the benefit of any person, other than Permitted Financial Accommodation or with the prior written consent of the Lender.

• (b) A Transaction Party must not permit financial accommodation to remain owing to it by a Relevant Company which is not a Transaction Party.

• (c) A Transaction Party must not satisfy any financial accommodation owed to a Relevant Company which is not a Transaction Party except any financial accommodation which, in aggregate with all other financial accommodation

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• owed by a Transaction Party to a Relevant Company which is not a Transaction Party that is satisfied in the 12 month period prior to the date on which the financial accommodation is to be satisfied, does not exceed A$10,000,000.

4.13 Restrictions on dealings

A Transaction Party must not deal with another party unless it does so at arm’s length for full commercial consideration and in the ordinary course of its ordinary business.

4.14 Maintenance of assets

Each Transaction Party, other than a Transaction Party whose assets comprise less than 2% of the Total Tangible Assets or a Transaction Party whose profits from ordinary activities account for less than 2% of EBITDA, must maintain and keep its assets in a good state of repair and in good working order allowing for fair wear and tear except where failure to do so would not have a material adverse effect on:

• (a) the financial condition of the Transaction Party;

• (b) its ability to perform any of its obligations under a Transaction Document; or

• (c) any Encumbrance provided to a Lender by that Transaction Party.

4.15 Insurance

Each Transaction Party must, and must ensure that each Relevant Company will:

• (a) maintain industrial special risks insurance, public liability insurance, professional indemnity liability insurance and directors and officers liability insurance with an independent and reputable insurer and consistent with the insurances maintained by it as at the date of this deed;

• (b) otherwise insure, and keep insured, its property which is of an insurable nature in the manner and to the extent which is in accordance with good business practice for property of such nature; and

• (c) promptly following a request by the Lender, provide the Lender with any certificates of currency or other evidence of currency in respect of all insurances required to be maintained by it under this deed.

4.16 Hedging

A Transaction Party must not (and in the case of Sims, must ensure that no Relevant Company will) enter into a Hedging Agreement except:

• (a) for the purposes of hedging that Transaction Party’s actual or projected interest rate, foreign exchange or other exposures arising in the ordinary course of its ordinary business and not for speculative purposes; or

• (b) with the Lender’s prior written consent.

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4 Undertakings

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4.17 Financial undertakings

• (a) Each Transaction Party must ensure that on each Calculation Date:

• (1) the ratio of Financial Indebtedness to EBITDA for the Calculation Period ending on that Calculation Date is not greater than 3.0:1;

• (2) the ratio of EBITDA to Net Interest Expense for the Calculation Period ending on that Calculation Date is not less than 3.5:1; and

• (3) Tangible Net Worth is at least 85% of the Tangible Net Worth calculated for the last Calculation Date of the preceding financial year.

4.18 Guarantors

• (a) Each Transaction Party must ensure that:

• (1) the Guarantors (excluding any German Guarantors) will:

  • (A) at all times own, in aggregate, at least 80% of the Total Tangible Assets of the Sims Group; and

  • (B) generate at least 80% of the EBITDA for each Calculation Period ending on a Calculation Date; and

• (2) where a Subsidiary owns at least 5% of Total Tangible Assets at any time or generates at least 5% of EBITDA for a Calculation Period ending on a Calculation Date, the Subsidiary becomes an Additional Guarantor in accordance with clause 14.4 within 3 months (or such minimum longer period of time as is required by law) of the earlier of the Subsidiary becoming the owner of at least 5% of Total Tangible Assets and the relevant Calculation Date, unless the Lender is provided with a written legal advice (in a form satisfactory to the Lender, acting reasonably) from a law firm in the jurisdiction in which the Subsidiary was incorporated to the effect that the accession of the Subsidiary to this deed as a Guarantor on the terms of this deed would be contrary to the law under which the Subsidiary was incorporated or carries on a substantial portion of its business.

• (b) A failure to comply with clause 4.18(a)(1) at any time, as a result of the acquisition of a Subsidiary or the acquisition of any new assets or a business, will not constitute a Default if Sims procures that additional members of the Sims Group become Guarantors in accordance with clause 14.4 to the extent required to ensure compliance with clause 4.18(a)(1) within 3 months of the relevant failure to comply.

4.19 Deed of Cross Guarantee

A Transaction Party:

• (a) must not consent to the amendment, termination, revocation, suspension or repudiation of, or waive its rights arising under, any Deed of Cross Guarantee to which it is a party without the Lender’s consent (which consent may be withheld in the Lender’s absolute discretion or, where granted, may be subject to such terms as the Lender, in its absolute discretion, requires); and

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5 Events of Default

• (b) must notify the Lender immediately upon it becoming aware of any proposal or request or requirement that it provide a consent or waiver in respect of any Deed of Cross Guarantee to which it is a party.

• 4.20 Term of undertakings

• Unless the Lender otherwise agrees in writing, until:

• (a) the commitment of that Lender is cancelled; and

• (b) the Outstanding Moneys of that Lender are unconditionally repaid in full;

• each Transaction Party must, at its own cost, comply with its undertakings in this clause 4.

• 5 Events of Default

• 5.1 Events of Default

• It is an Event of Default in respect of a Lender, whether or not it is within the control of a Transaction Party, if:

• (a) failure to pay : a Transaction Party fails to pay principal under a Transaction Document of that Lender or any interest or any other amount payable under a Transaction Document of that Lender on time on the due date in the manner required under that Transaction Document unless, in the case of interest or any other amount, it is paid within 2 days of the due date and it demonstrates to the satisfaction of that Lender that the delay was due to a failure in transmission of funds outside of its control where the funds were available to it with a bank and it gave the requisite instructions;

• (b) failure to comply : a Transaction Party fails to comply with clause 4.17 or clause 4.18;

• (c) non-remediable failure : a Transaction Party fails to perform any other undertaking or obligation of it under any Transaction Document of that Lender and that failure is not in the opinion of that Lender remediable;

• (d) remediable failure : the failure described in clause 5.1(c) is in the opinion of that Lender remediable, and the Transaction Party does not remedy the failure within 10 Business Days after receipt by the Transaction Party of a notice from that Lender specifying the failure;

• (e) misrepresentation : any representation or warranty or statement of a Transaction Party under a Transaction Document of that Lender is incorrect or misleading in a material respect when made or repeated;

• (f) cross default : any Financial Indebtedness of a Relevant Company in an amount of at least A$5,000,000 or its equivalent or of the Relevant Companies totalling (in aggregate for all such Relevant Companies) at least A$25,000,000 or its equivalent:

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5 Events of Default

• (1) becomes due and payable before the scheduled date for payment (except as a result of an exercise of a prepayment right in the absence of default); or

• (2) is not paid when due (after taking into account any applicable grace period);

• (g) Cancellation of commitment: An obligation upon any person to provide finance to:

• (1) a Relevant Company totalling at least A$5,000,000 (or its equivalent); or

• (2) the Relevant Companies totalling (in aggregate) at least A$25,000,000 (or its equivalent),

• is terminated except as a result of voluntary termination in the absence of default;

• (h) Encumbrance : any Encumbrance is enforced against an asset or assets of a Relevant Company with a value or in an amount exceeding A$10,000,000 or its equivalent;

• (i) execution : a distress, attachment, execution or other process of a Government Agency is issued against, levied or entered upon:

• (1) an asset of a Relevant Company with a value or in an amount of at least A$10,000,000 or its equivalent; or

• (2) an asset or assets of Relevant Companies totalling (in aggregate for all such Relevant Companies) at least A$25,000,000 or its equivalent,

• and is not set aside or satisfied within 10 Business Days;

• (j) suspends payment : a Relevant Company suspends payment of its debts generally;

• (k) insolvency : a Relevant Company is Insolvent;

• (l) maintenance of capital and existence : a Transaction Party fails to comply with clause 4.5 or 4.9;

• (m) unenforceability :

• (1) all or a material part of a Transaction Document of that Lender is illegal, void, voidable or unenforceable;

• (2) a Relevant Company becomes entitled to terminate any material provision of any Transaction Document of that Lender (other than following the occurrence of a termination event or an event of default under a Hedging Agreement with the Lender in respect of which the Lender is an “Affected Party” or the “Defaulting Party” (as applicable) (as defined in that Hedging Agreement)); or

• (3) the execution, delivery or performance of a Transaction Document of that Lender by a Transaction Party or the exercise by the Lender of all

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5 Events of Default

  - or any of its rights under a Transaction Document breaches or results in a contravention of any law;

• (n) Environmental : there is any claim or requirement of expenditure or alteration of activity or cessation of activity under any Environmental Law or law relating to health or there is any breach of any Authorisation, in each case which in the opinion of the Lender is likely to have a Material Adverse Effect or any circumstance arises which may give rise to such an action, claim, requirement or breach;

• (o) Governmental interference : a law or anything done by a Governmental Agency is likely to in the opinion of the Lender have a Material Adverse Effect;

• (p) seizure : all or any material part of the assets of the Sims Group are seized or otherwise appropriated by, or custody thereof is assumed by any Governmental Agency, or the Sims Group is otherwise prevented from exercising normal day-to-day control over all or a material part of its assets or loses any of the rights or privileges necessary to maintain its existence or to carry on its business and Sims does not demonstrate to the reasonable satisfaction of the Lender within 15 Business Days of such seizure, appropriation, assumption of custody or execution that no Material Adverse Effect has resulted, or is reasonably likely to result, therefrom;

• (q) event of default : an event of default, termination event (other than a termination event under a Hedging Agreement with the Lender in respect of which the Lender is an “Affected Party” (as defined in that Hedging Agreement)) or other similar event occurs with respect to a Relevant Company under any agreement relating to Financial Indebtedness between a Relevant Company and the Lender including the occurrence of an event which is an “event of default” with respect to a Relevant Company under any Transaction Document of that Lender other than this agreement, or any other event occurs which renders enforceable a Transaction Document of that Lender which comprises or includes a Guarantee;

• (r) Disposal without consent : a disposal occurs which cannot be prohibited pursuant to Section 1136 German Civil Code (Bürgerliches Gesetzbuch), if the disposal has not been approved by the Lender in writing, provided such disposal corresponds to a disposal set out in clause 4.10(a) and 4.10(c);

• (s) investigation : a person is appointed under the Corporations Act or any other applicable legislation to investigate any part of the affairs of a Transaction Party and the relevant Transaction Party does not demonstrate to the reasonable satisfaction of the Lender within 15 Business Days of such appointment that no Material Adverse Effect has resulted from, or is reasonably likely to result from, the investigation or as a consequence thereof;

• (t) deregistration : a step is taken under section 601AA, 601AB or 601AC of the Corporations Act or analogous provisions in a relevant jurisdiction to cancel the registration of a Transaction Party;

• (u) ASX delisting/suspension : except with the written consent of the Lender, any securities of Sims are:

• (1) not listed on at least one of:

• (A) the official list of the Australian Securities Exchange operated by ASX Limited; or

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5 Events of Default

• (B) the official list of the New York Stock Exchange; or

• (2) suspended from quotation or trading on any official list referred to in clause 5.1(u)(1) for 5 consecutive trading days (except where such suspension is requested by Sims for the purpose of an acquisition or a fundraising and such securities remain suspended on that basis only and not on any other basis); or

• (3) removed from the official list of any of:

• (A) the Australian Securities Exchange operated by ASX Limited;

• (B) the New York Stock Exchange; or

• (C) another stock exchange,

because the operator of the relevant stock exchange decides that Sims or its securities no longer meet the requirements for continued listing (except where Sims has requested such removal and that is the sole basis for the removal);

• (v) material adverse effect : any event occurs which, in the reasonable opinion of the Lender, may have a Material Adverse Effect; and

• (w) ceasing business : a Transaction Party stops payment, significantly changes the general character of its business or threatens to do any of those things, or a Relevant Company ceases to carry on business, except to reconstruct or amalgamate while solvent, and which event may have a Material Adverse Effect.

• 5.2 Effect of Event of Default

• (a) If an Event of Default in respect of a Lender occurs that Lender may at any time after its occurrence by notice to Sims declare that:

  • (1) the Outstanding Moneys under that Facility are immediately due and payable; or

  • (2) the Commitment under that Facility is cancelled,

or make each of the declarations under clauses 5.2(a)(1) and (2).

• (b) Subject to clause 5.2(c), the Borrowers must immediately repay the Outstanding Moneys under the relevant Facility on receipt of a notice under clause 5.2(a)(1).

• (c) A notice given by a Lender under clause 5.2(a)(1) and (a)(2) shall be of no effect if:

• (1) it is given because of the occurrence of an Event of Default specified in clause 5.1(b), 5.1(c), 5.1(e), 5.1(f), 5.1(g), 5.1(l), 5.1 (m) or 5.1(w); and

• (2) within 2 Business Days of the notice the Transaction Parties are able to show to the Lender’s absolute satisfaction (in the Lender’s absolute discretion) that:

• (A) the Event of Default is not subsisting; or

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6 Review Event

• (B) where the notice relates to an Event of Default specified in clause 5.1(l) or 5.1(w), the Event of Default subsisting does not and will not have a Material Adverse Effect.

5.3 Transaction Parties to continue to perform

• (a) If the Lender makes a declaration under clause 5.2:

• (1) the declaration does not affect the obligations of a Transaction Party under the Transaction Documents; and

• (2) each Transaction Party must continue to perform its obligations under the Transaction Documents as if the declaration had not been made, subject to any directions given by the Lender under any Transaction Document.

• (b) Clause 5.3(a) does not affect the Borrower’s obligations under clause 5.2.

5.4 Enforcement

• (a) The Transaction Documents may be enforced without notice to a Transaction Party or any other person even if:

  • (1) the Lender accepts any part of the Outstanding Moneys after an Event of Default; or

  • (2) there has been any other Event of Default.

• (b) The Lender is not liable to any Transaction Party for any Loss a Transaction Party may suffer, incur or be liable for arising out of or in connection with the Lender exercising any Power, except to the extent specifically set out in a Transaction Document.

• 6 Review Event

• (a) It is a Review Event with respect to a Facility and a Lender if:

  • (1) Control : the persons who at the date of this deed have Control of Sims cease to have Control of Sims; or

  • (2) listing : any securities of Sims are added to the official list of any stock exchange (other than the official list of the Australian Securities Exchange operated by ASX Limited and the official list of the New York Stock Exchange).

• (b) If a Review Event occurs under:

  • (1) clause 6(a)(1), then the relevant Lender may, within 90 days after the date on which the Lender is notified of that change of Control, review the terms of any financial accommodation provided under any Transaction Document of that Lender. Following that review, the

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7 Guarantee and indemnity

  - Lender may require repayment on demand of all or part of the financial accommodation provided to any Transaction Party and terminate all its Facilities;

• (2) clause 6(a)(2), then the relevant Lender may, for a period of not less than 60 days after the date the Lender is notified of that event ( Listing Review Period ), review the terms of any financial accommodation provided under any Transaction Document. Following the Listing Review Period the Lender may require repayment on demand of all or part of the financial accommodation provided to any Transaction Party and terminate all its Facilities, if the Lender, acting reasonably, believes that Sims’ presence on the official list of such a stock exchange, will have, or is reasonably likely to have, a Material Adverse Effect.

• 7 Guarantee and indemnity

7.1 Guarantee

The Guarantors jointly and severally and unconditionally and irrevocably guarantee to each Lender severally the payment of the Outstanding Moneys of that Lender.

7.2 Payment

• (a) If the Outstanding Moneys are not paid when due, each Guarantor must immediately on demand from a Lender pay to that Lender the Outstanding Moneys of that Lender in the same manner and currency as the Outstanding Moneys are required to be paid.

• (b) A demand under clause 7.2(a) may be made at any time and from time to time.

• 7.3 Securities for other money

A Lender may apply any amounts received by it or recovered under any:

• (a) Collateral Security; or

• (b) other document or agreement,

which is a security for any of the Outstanding Moneys and any other money in the manner it determines in its absolute discretion.

• 7.4 Amount of Outstanding Moneys

• (a) This clause 7 applies to any amount which forms part of the Outstanding Moneys from time to time.

• (b) The obligations of each Guarantor under this clause 7 extend to any increase in the Outstanding Moneys as a result of:

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7 Guarantee and indemnity

• (1) any amendment, supplement, renewal or replacement of any Transaction Document to which a Transaction Party and the Lender is a party; or

• (2) the occurrence of any other thing.

• (c) Clause 7.4(b):

• (1) applies regardless of whether any Guarantor is aware of or consented to or is given notice of any amendment, supplement, renewal or replacement of any agreement to which a Transaction Party and the Lender is a party or the occurrence of any other thing; and

• (2) does not limit the obligations of any Guarantor under this clause 7.

7.5 Proof by Lender

In the event of the liquidation of a Transaction Party, each Guarantor authorises the Lender to prove for all money which any Guarantor has paid or is or may be obliged to pay under any Transaction Document of that Lender, any other document or agreement or otherwise in respect of the Outstanding Moneys of that Lender.

7.6 Avoidance of payments

• (a) If any payment, conveyance, transfer or other transaction relating to or affecting the Outstanding Moneys is:

• (1) void, voidable or unenforceable in whole or in part; or

• (2) claimed to be void, voidable or unenforceable and that claim is upheld, conceded or compromised in whole or in part,

• the liability of each Guarantor under this clause 7 and any Power is the same as if:

• (3) that payment, conveyance, transfer or transaction (or the void, voidable or unenforceable part of it); and

• (4) any release, settlement or discharge made in reliance on any thing referred to in clause 7.6(a)(3),

had not been made and each Guarantor must immediately take all action and sign all documents necessary or required by the Lender to restore to the Lender the benefit of this clause 7 and any Encumbrance held by the Lender immediately before the payment, conveyance, transfer or transaction.

• (b) Clause 7.6(a) applies whether or not the Lender knew, or ought to have known, of anything referred to in clause 7.6(a).

• 7.7 Indemnity for avoidance of Outstanding Moneys

• (a) If any of the Outstanding Moneys (or money which would have been Outstanding Moneys if it had not been irrecoverable) are irrecoverable by the Lender from:

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7 Guarantee and indemnity

• (1) any Transaction Party; or

• (2) a Guarantor on the footing of a guarantee,

the Guarantors jointly and severally, unconditionally and irrevocably, and as a separate and principal obligation:

  - (3) indemnify the Lender against any Loss suffered, paid or incurred by the Lender in relation to the non payment of that money; and

  - (4) must pay the Lender an amount equal to that money.

• (b) Clause 7.7(a) applies to the Outstanding Moneys (or money which would have been Outstanding Moneys if it had not been irrecoverable) which are or may be irrecoverable irrespective of whether:

  • (1) they are or may be irrecoverable because of any event described in clause 7.6;

  • (2) they are or may be irrecoverable because of any other fact or circumstance;

  • (3) the transactions or any of them relating to that money are void or illegal or avoided or otherwise unenforceable; and

  • (4) any matters relating to the Outstanding Moneys are or should have been within the knowledge of the Lender.

• 7.8 No obligation to marshal

• The Lender is not required to marshal or to enforce or apply under or appropriate, recover or exercise:

• (a) any Encumbrance, Guarantee or Collateral Security or other document or agreement held, at any time, by or on behalf of that or the Lender; or

• (b) any money or asset which the Lender, at any time, holds or is entitled to receive.

• 7.9 Non-exercise of Guarantors’ rights

A Guarantor must not exercise any rights it may have inconsistent with this clause 7.

• 7.10 Principal and independent obligation

• (a) This clause 7 is:

  • (1) a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation; and

  • (2) independent of and not in substitution for or affected by any other Collateral Security which the Lender may hold in respect of the Outstanding Moneys or any obligations of any Transaction Party or any other person.

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7 Guarantee and indemnity

• (b) This clause 7 is enforceable against a Guarantor:

• (1) without first having recourse to any Collateral Security;

• (2) whether or not the Lender has made demand on any Transaction Party (other than any demand specifically required to be given, or notice required to be issued, to a Guarantor under clause 7.2 or any other provision of a Transaction Document);

• (3) whether or not the Lender has given notice to any Transaction Party or any other person in respect of any thing;

• (4) whether or not the Lender has taken any other steps against any Transaction Party or any other person;

• (5) whether or not any Outstanding Moneys is then due and payable; and

• (6) despite the occurrence of any event described in clause 7.12.

7.11 Suspense account

• (a) The Lender may apply to the credit of an interest bearing suspense account any:

• (1) amounts received under this clause 7;

• (2) dividends, distributions or other amounts received in respect of the Outstanding Moneys in any liquidation; and

• (3) other amounts received from a Guarantor, a Transaction Party or any other person in respect of the Outstanding Moneys.

• (b) The Lender may retain the amounts in the suspense account for as long as it determines and is not obliged to apply them in or towards satisfaction of the Outstanding Moneys. Following payment in full of the Outstanding Moneys, it shall return the balance to the relevant Transaction Party or to another person entitled to it.

7.12 Unconditional nature of obligations

• (a) This clause 7 and the obligations of each Guarantor under the Transaction Documents are absolute, binding and unconditional in all circumstances, and are not released or discharged or otherwise affected by anything which but for this provision might have that effect, including:

• (1) the grant to any Transaction Party or any other person at any time, of a waiver, covenant not to sue or other indulgence;

• (2) the release (including a release as part of any novation) or discharge of any Transaction Party or any other person other than an express release given to a Transaction Party in writing;

• (3) the cessation of the obligations, in whole or in part, of any Transaction Party or any other person under any Transaction Document or any other document or agreement;

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7 Guarantee and indemnity

• (4) the liquidation of any Transaction Party or any other person;

• (5) any arrangement, composition or compromise entered into by the Lender, any Transaction Party or any other person;

• (6) any Transaction Document or any other document or agreement being in whole or in part illegal, void, voidable, avoided, unenforceable or otherwise of limited force or effect;

• (7) any extinguishment, failure, loss, release, discharge, abandonment, impairment, compounding, composition or compromise, in whole or in part of any Transaction Document or any other document or agreement;

• (8) any Collateral Security being given to the Lender by any Transaction Party or any other person;

• (9) any alteration, amendment, variation, supplement, renewal or replacement of any Transaction Document or any other document or agreement;

• (10) any moratorium or other suspension of any Power;

• (11) the Lender or Attorney exercising or enforcing, delaying or refraining from exercising or enforcing, or being not entitled or unable to exercise or enforce any Power;

• (12) the Lender obtaining a judgment against any Transaction Party or any other person for the payment of any of the Outstanding Moneys;

• (13) any transaction, agreement or arrangement that may take place with the Lender, any Transaction Party or any other person;

• (14) any payment to the Lender or Attorney, including any payment which at the payment date or at any time after the payment date is in whole or in part illegal, void, voidable, avoided or unenforceable;

• (15) any failure to give effective notice to any Transaction Party or any other person of any default under any Transaction Document or any other document or agreement;

• (16) any legal limitation, disability or incapacity of any Transaction Party or of any other person;

• (17) any breach of any Transaction Document or any other document or agreement;

• (18) the acceptance of the repudiation of, or termination of, any Transaction Document or any other document or agreement;

• (19) any Outstanding Moneys being irrecoverable for any reason;

• (20) any disclaimer by any Transaction Party or any other person of any Transaction Document or any other document or agreement;

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7 Guarantee and indemnity

  - (21) any assignment, novation, assumption or transfer of, or other dealing with, any Powers or any other rights or obligations under any Transaction Document or any other document or agreement;

  - (22) the opening of a new account of any Transaction Party with the Lender or any transaction on or relating to the new account;

  - (23) any prejudice (including material prejudice) to any person as a result of any thing done or omitted by the Lender, any Transaction Party or any other person;

  - (24) any prejudice (including material prejudice) to any person as a result of the Lender, Attorney or any other person selling or realising any property the subject of a Collateral Security at less than the best price;

  - (25) any prejudice (including material prejudice) to any person as a result of any failure or neglect by the Lender, Attorney or any other person to recover the Outstanding Moneys from any Transaction Party or by the realisation of any property the subject of a Collateral Security;

  - (26) any prejudice (including material prejudice) to any person as a result of any other thing;

  - (27) the receipt by the Lender of any dividend, distribution or other payment in respect of any liquidation;

  - (28) the failure of any other Guarantor or any other person who is intended to become a co-surety or co-indemnifier of that Guarantor to execute this deed or any other document; or

  - (29) any other act, omission, matter or thing whether negligent or not.

• (b) Clause 7.12(a) applies irrespective of:

  • (1) the consent or knowledge or lack of consent or knowledge, of the Lender, any Transaction Party or any other person of any event described in clause 7.12(a); or

  • (2) any rule of law or equity to the contrary.

• 7.13 No competition

• (a) Until the Outstanding Moneys have been fully paid and this clause 7 has been finally discharged, a Guarantor is not entitled to:

  • (1) be subrogated to the Lender;

  • (2) claim or receive the benefit of any Encumbrance, Guarantee or other document or agreement of which the Lender has the benefit;

  • (3) claim or receive the benefit of any moneys held by the Lender; or

  • (4) claim or receive the benefit of any Power;

  • (5) either directly or indirectly prove in, claim or receive the benefit of any distribution, dividend or payment arising out of or relating to the

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7 Guarantee and indemnity

  - liquidation of any Transaction Party liable to pay the Outstanding Moneys, except in accordance with clause 7.13(b);

• (6) make a claim or exercise or enforce any right, power or remedy (including under an Encumbrance or Guarantee or by way of contribution) against any Transaction Party liable to pay the Outstanding Moneys other than payments made in the ordinary course of business that are not otherwise restricted by this clause 7.13;

• (7) accept, procure the grant of or allow to exist any Encumbrance in favour of a Guarantor from any Transaction Party liable to pay the Outstanding Moneys;

• (8) exercise or attempt to exercise any right of set-off against, or realise any Encumbrance taken from, any Transaction Party liable to pay the Outstanding Moneys; or

• (9) raise any defence or counterclaim in reduction or discharge of its obligations under this clause 7.

• (b) If required by the Lender, a Guarantor must prove in any liquidation of any Transaction Party liable to pay the Outstanding Moneys for all money owed to the Guarantor.

• (c) All money recovered by a Guarantor from any liquidation or under any Encumbrance or Guarantee from any Transaction Party liable to pay the Outstanding Moneys must be received and held in trust by the Guarantor for the Lender to the extent of the unsatisfied liability of the Guarantor under this clause 7.

• (d) A Guarantor must not do or seek, attempt or purport to do anything referred to in clause 7.13(a).

7.14 Continuing guarantee

This clause 7 is a continuing obligation of each Guarantor, despite:

• (a) any settlement of account; or

• (b) the occurrence of any other thing,

and remains in full force and effect until:

• (c) all the Outstanding Moneys have been paid in full; and

• (d) this clause 7 has been finally discharged by all the Lenders.

7.15 Variation

This clause 7 extends to cover the Transaction Documents as amended, varied or replaced, whether with or without the consent of any one or more of the Guarantors, including any increase in the limit or maximum principal amount available under a Transaction Document.

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8 German Guarantors

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7.16 Judgments

• A final judgment obtained against a relevant Transaction Party is conclusive as against each Guarantor.

• 8 German Guarantors

• (a) To the extent that the guarantee created under clause 7 is granted by a German Guarantor (a German Guarantee ) and the German Guarantee guarantees to a Lender (the Relevant Lender ) amounts which are owed by direct or indirect shareholders of the German Guarantor or affiliated companies of such shareholders (with the exception of affiliated companies which are also affiliated companies of the German Guarantor), the German Guarantee to the Relevant Lender shall be subject to certain limitations as set out in clause 8(b). In relation to any other amounts guaranteed, the German Guarantee remains unlimited.

• (b) To the extent that a demand under clause 7 is made by a Relevant Lender upon a German Guarantor in respect of amounts in relation to which the conditions pursuant to clause 8(a) are fulfilled, the relevant German Guarantor’s liability shall be limited, in respect of that demand only:

  • (1) if the value of that German Guarantor’s Net Assets is greater than its stated share capital at the time of the demand, to that amount such that after payment of that amount the value of the German Guarantor’s Net Assets is not less than its stated share capital ( Stammkapital ); or

  • (2) if the value of its Net Assets is lower than its stated share capital at the time of the demand, to nil,

for the purpose of not affecting its assets which are required for the obligatory preservation of its stated share capital according to §§ 30, 31 German GmbH-Act ( GmbH-Gesetz ).

(c) In this clause 8, Net Assets ( Nettovermögen ) means the sum of the German Guarantor’s assets pursuant to Section 266 para. 2 A, B and C of the German Commercial Code ( Handelsgesetzbuc h), less the sum of the German Guarantor’s liabilities pursuant to Section 266, paragraphs 3 B, C (but disregarding, for the avoidance of doubt, the obligations under clause 7 of this deed) and D of the German Commercial Code ( Handelsgesetzbuch ) each as shown in a balance sheet as of the date on which the enforcement of the German Guarantee is sought ( Stichtagsbilanz ) whereby the balance sheet shall be adjusted as set out under clause 8(d).

• (d) For the purposes of calculating the Net Assets, the following balance sheet items shall be adjusted as follows:

• (1) loans provided to the German Guarantor shall be disregarded, if and to the extent such loans have been made available, directly or indirectly to the German Guarantor from funds made available by the Relevant Lender;

• (2) the amount of any increase of the stated share capital ( Stammkapital ) of the German Guarantor registered after the date of such German

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9 Payments

     - Guarantor becoming a party to this deed without the prior written consent of the Relevant Lender shall be deducted from the relevant stated share capital;

  - (3) loans provided to the German Guarantor by any of its affiliated entities shall be disregarded if and to the extent such loans are subordinated, or are considered subordinated pursuant to Section 39, paragraph 1, number 5 German Insolvency Act ( _InsO_ ); and

  - (4) loans and other liabilities incurred in violation of the provisions of the Transaction Documents shall be disregarded.

• (e) This clause 8 shall apply mutatis mutandis if the German Guarantee is granted by a Guarantor incorporated in Germany as a limited liability partnership (GmbH & Co. KG) in relation to the limited liability company as general partner ( Komplementär ) of such Guarantor.

• 9 Payments

9.1 Manner of payment

All payments by a Transaction Party under the Transaction Documents must be made:

• (a) in Same Day Funds;

• (b) in the Relevant Currency;

• (c) no later than 10.00am in the place for payment on the due date,

to the Lender’s account as specified by the Lender to the Borrower or in any other manner the Lender directs from time to time.

9.2 Payments on a Business Day

If a payment is due on a day which is not a Business Day, the due date for that payment is the next Business Day in the same calendar month or, if none, the preceding Business Day, and interest must be adjusted accordingly.

9.3 Payments in gross

All payments which a Transaction Party is required to make under any Transaction Document must be without:

• (a) any set-off, counterclaim or condition; or

• (b) any deduction or withholding for any Tax or any other reason unless the Transaction Party is required to make a deduction or withholding by applicable law.

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9 Payments

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9.4 Additional payments

• (a) any Transaction Party is required to make a deduction or withholding in respect of Tax (other than Excluded Tax) from any payment to be made to the Lender under any Transaction Document; or

• (b) the Lender is required to pay any Tax (other than Excluded Tax) in respect of any payment it receives from a Transaction Party under any Transaction Document,

the Transaction Party:

• (c) indemnifies the Lender against that Tax; and

• (d) must pay to the Lender an additional amount which the Lender determines to be necessary to ensure that the Lender receives when due a net amount (after payment of any Tax in respect of each additional amount) that is equal to the full amount it would have received if a deduction or withholding or payment of Tax had not been made.

9.5 Taxation deduction procedures

• If clause 9.4(a) applies:

• (a) the Transaction Party must pay the amount deducted or withheld to the appropriate Government Agency as required by law; and

• (b) the Transaction Party must:

• (1) use reasonable endeavours to obtain a payment receipt from the Government Agency (and any other documentation ordinarily provided by the Government Agency in connection with the payment); and

• (2) within 2 Business Days after receipt of the documents referred to in clause 9.5(b)(1), deliver copies of them to the Lender.

9.6 Tax Credit

• If a Transaction Party makes an additional payment under clause 9.4 for the benefit of the Lender, and the Lender determines that:

• (a) a credit against, relief or remission for, or repayment of any Tax ( Tax Credit ) is attributable to that additional payment; and

• (b) the Lender has obtained, utilised and retained that Tax Credit,

then the Lender must pay an amount to the Transaction Party which the Lender determines will leave it (after that payment) in the same after Tax position as it would have been in had the additional payment not been made by the Transaction Party.

9.7 Tax affairs

Nothing in clause 9.6:

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9 Payments

• (a) interferes with the right of the Lender to arrange its tax affairs in any manner it thinks fit;

• (b) obliges the Lender to investigate the availability of, or claim, any Tax Credit; or

• (c) obliges the Lender to disclose any information relating to its tax affairs or any tax computations.

9.8 Amounts payable on demand

If any amount payable by a Transaction Party under any Transaction Document is not expressed to be payable on a specified date, that amount is payable by the Transaction Party on demand by the Lender.

9.9 Appropriation of payments

• (a) All payments made by a Transaction Party under a Transaction Document may be appropriated as between principal, interest and other amounts as the Lender determines or, failing any determination, in the following order:

  • (1) first, towards reimbursement of all fees, costs, expenses, charges, damages and indemnity payments due and payable by the Transaction Parties under the Transaction Documents;

  • (2) second, towards payment of interest due and payable under the Transaction Documents; and

  • (3) third, towards repayment or prepayment of the Principal Outstanding.

• (b) Any appropriation under clauses 9.9(a) overrides any appropriation made by a Transaction Party.

• 9.10 Currency exchanges

• If the Lender receives an amount under a Transaction Document in a currency which is not in the Relevant Currency, the Lender:

• (a) may convert the amount received into the Relevant Currency in accordance with its normal procedures; and

• (b) is only regarded as having received the amount that it has converted into the Relevant Currency.

• 9.11 Currency of account

• (a) Subject to paragraphs 9.11(b) to 9.11(e) below, Dollars are the currency of account and payment for any sum due from a Borrower or any other Transaction Party under any Transaction Document.

• (b) A repayment of financial accommodation shall be made on its due date in the currency in which it is denominated.

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10 Increased costs and illegality

• (c) Each payment of interest shall be made in the currency in which the sum in respect of which the interest is payable was denominated when that interest accrued.

• (d) Each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred.

• (e) Any amount expressed to be payable in a currency other than Dollars shall be paid in that other currency.

9.12 Change of currency

• (a) Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:

  • (1) any reference in a Transaction Document to, and any obligations arising under a Transaction Document in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Lender (after consultation with the Borrowers); and

  • (2) any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Lender (acting reasonably).

• (b) If a change in any currency of a country occurs, this agreement will, to the extent the Lender (acting reasonably and after consultation with the Borrowers) specifies to be necessary, be amended to comply with any generally accepted conventions and market practice in the Relevant Interbank Market and otherwise to reflect the change in currency.

• 10 Increased costs and illegality

• 10.1 Increased costs

• (a) If a Lender determines that any Change in Law affecting it or any of its holding companies (each a Holding Company ) directly or indirectly:

  • (1) increases the effective cost to the Lender of performing its obligations under the Transaction Documents of that Lender or funding or maintaining that Lender’s participation in that Lender’s Facility;

  • (2) reduces any amount received or receivable by the Lender under the Transaction Documents of that Lender; or

  • (3) in any other way reduces the effective return to the Lender or any Holding Company under the Transaction Documents of that Lender or the overall return on capital of the Lender or any Holding Company,

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10 Increased costs and illegality

• (each an Increased Cost ), the Borrowers must pay to the Lender on demand compensation for the Increased Cost to the extent attributed by the Lender or Holding Company (using the methods it considers appropriate) to the Lender’s obligations under the Transaction Documents of that Lender or the funding or maintenance of that Lender’s Facility.

• (b) A Transaction Party is not obliged to pay compensation under this clause if the relevant increased cost, reduction in the amount receivable or reduction in return on capital is:

• (1) fully compensated for by clause 9.4; or

• (2) attributable to the wilful breach by the Lender claiming the benefit of the clause of any law or a breach by the Lender of the terms of a Transaction Document.

• (c) A claim under clause 10.1(a) in the absence of manifest error, is sufficient evidence of the amount to which the Lender is entitled under clause 10.1(a) unless the contrary is proved.

• (d) If Sims receives a demand from a Lender under clause 10.1(a), the Borrowers may, by written notice to the Lender on or before the date which is 20 Business Days after the date of that demand, cancel the commitment of that Lender and prepay its Outstanding Moneys in full.

• (e) A notice under clause 10.1(d) is irrevocable and the relevant Borrowers must, on the date which is 40 Business Days after the date that the notice is given, pay to that Lender the Outstanding Moneys of that Lender in full.

10.2 Illegality

• (a) If any Change in Law or other event makes it illegal for a Lender to perform its obligations under the Transaction Documents of that Lender or fund or maintain that Lender’s Facility, that Lender may by notice to Sims:

• (1) suspend all or part of its obligations under the Transaction Documents for the duration of the illegality; or

• (2) by notice to Sims, cancel all or part of its Commitment and require the Borrowers to repay the Outstanding Moneys in part or in full on the date which is 40 Business Days after the date on which the Lender gives the notice or any earlier date required by, or to comply with, the applicable law,

provided that if the Lender determines in its absolute discretion that the illegality can be avoided by a partial suspension or cancellation, then the Lender may only suspend its obligations or cancel its Commitment under this clause 10.2 to the extent it considers necessary to avoid the illegality.

• (b) A notice under clause 10.2(a)(2) is irrevocable and the Borrowers must, on the repayment date determined under clause 10.2(a)(2), pay to the relevant Lender the Outstanding Moneys of that Lender in full.

• (c) If this clause 10.2 applies, the relevant Lender agrees to use reasonable endeavours for a period of 90 days to make the relevant financial accommodation available by some alternative means including changing its Lending Office or making the financial accommodation available through a

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11 Indemnities

Related Body Corporate provided that nothing in this clause 10.2 will oblige the Lender to incur any costs or expenses or take any action or refrain from taking any action where, in the opinion of the Lender, the taking of that action or the refraining from taking that action is impractical, may be prejudicial to the Lender or is contrary to the Lender’s policies.

11 Indemnities

11.1 General indemnity

• (a) Each Borrower indemnifies each Lender against any Loss which that Lender (whether acting as agent of the Borrower or of the Lender) or an Attorney pays, suffers, incurs or is liable for, in respect of any of the following:

• (1) financial accommodation requested under a Transaction Document not being made for any reason including any failure by a Transaction Party to fulfil any condition precedent contained in the Transaction Documents of that Lender, but excluding any default by that Lender;

• (2) financial accommodation provided by that Lender being repaid or discharged other than on the scheduled date for repayment or discharge;

• (3) the occurrence of any Default;

• (4) that Lender exercising its Powers consequent upon or arising out of the occurrence of any Default;

• (5) the non-exercise, attempted exercise, exercise or delay in the exercise of any Power; and

• (6) any act or omission of a Transaction Party or any of its employees or agents.

• (b) The indemnity in clause 11.1(a), includes the amount determined by the Lender as being incurred by reason of the liquidation or reemployment of deposits or other funds acquired or contracted for by the Lender to fund or maintain its Facility.

11.2 Foreign currency indemnity

If, at any time:

• (a) a Lender or an Attorney receives or recovers any amount payable by a Transaction Party including:

• (1) under any judgment or order of any Government Agency;

• (2) for any breach of any Transaction Document;

• (3) on the liquidation or bankruptcy of the Transaction Party or any proof or claim in that liquidation or bankruptcy; or

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12 Fees, Tax, costs and expenses

• (4) any other thing into which the obligations of the Transaction Party may have become merged; and

• (b) the Payment Currency is not the Relevant Currency,

the Borrower indemnifies the Lender or Attorney against any shortfall between the amount payable in the Relevant Currency and the amount actually or notionally received or recovered by the Lender or Attorney after the Payment Currency is converted or translated into the Relevant Currency under clause 11.3.

11.3 Conversion of currencies

In making any currency conversion under clause 11.2, the Lender or Attorney may itself or through its bankers purchase one currency with another, whether or not through an intermediate currency, whether spot or forward, in accordance with its normal practice.

11.4 Continuing indemnities and evidence of loss

• (a) Each indemnity of a Transaction Party in a Transaction Document is a continuing obligation of the Transaction Party, despite:

• (1) any settlement of account; or

• (2) the occurrence of any other thing,

and remains in full force and effect until the Outstanding Moneys are fully and finally repaid.

• (b) Each indemnity of a Transaction Party in a Transaction Document is an additional, separate and independent obligation of a Transaction Party and no one indemnity limits the general nature of any other indemnity.

• (c) Each indemnity of a Transaction Party in a Transaction Document survives the termination of any Transaction Document.

• (d) A certificate given by an Officer of the Lender detailing the amount of any Loss covered by any indemnity in a Transaction Document is sufficient evidence unless the contrary is proved. Any such certificate must provide reasonable details of the amount claimed and where appropriate how it has been calculated.

• 12 Fees, Tax, costs and expenses

• 12.1 Tax

• (a) The Borrowers must pay any Tax, other than an Excluded Tax in respect of the Lender, which is payable in respect of a Transaction Document (including in respect of the execution, delivery, performance, release, discharge, amendment or enforcement of a Transaction Document).

• (b) The Borrowers must pay any fine, penalty or other cost in respect of a failure to pay any Tax described in clause 12.1(a) except to the extent that the fine,

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13 Assignment and substitution

penalty or other cost is caused by the Lender’s failure to lodge money received from the Borrower within 5 Business Days before the due date for lodgement.

• (c) Each Borrower indemnifies the Lender against any amount payable under clause 12.1(a) or (b).

12.2 Costs and expenses

• The Borrowers must pay all costs and expenses of the Lender in relation to:

• (a) the negotiation, preparation, execution, delivery, stamping, registration, completion, variation and discharge of any Transaction Document, provided that those costs and expenses are reasonable;

• (b) the enforcement, protection or waiver of any rights under any Transaction Document;

• (c) the consent or approval of the Lender given under any Transaction Document, provided that those costs and expenses are reasonable; and

• (d) any enquiry by a Government Agency involving a Transaction Party,

including any legal costs and expenses and any professional consultant’s fees on a full indemnity basis, subject, in the case of costs and expenses arising under clause 12.2(a) or 12.2(c) only, to any maximum amount for such costs, expenses and fees agreed between the Lender and Sims.

12.3 GST

• (a) If GST is or will be imposed on a supply made under or in connection with a Transaction Document by a Lender, the Lender may, to the extent that the consideration otherwise provided for that supply is not stated to include an amount in respect of GST on the supply:

• (1) increase the consideration otherwise provided for that supply under the Transaction Document by the amount of that GST; or

• (2) otherwise recover from the recipient of the supply the amount of that GST.

• (b) The Lender must issue a Tax Invoice to the recipient of the supply no later than 5 Business Days after payment to the Lender of the GST inclusive consideration for that supply.

• (c) Where under a Transaction Document a Transaction Party is required to reimburse or indemnify for an amount, that Transaction Party will pay the relevant amount (including any sum in respect of GST) less any GST input tax credit the relevant Lender is entitled to claim in respect of that amount.

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13 Assignment and substitution

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13 Assignment and substitution

13.1 Assignment by Transaction Party

A Transaction Party must not assign or novate any of its rights or obligations under a Transaction Document of a Lender without the Lender’s prior written consent.

13.2 Assignment by Lender

The Lender may assign or novate any of its rights and obligations under a Transaction Document of that Lender to any person if:

• (a) any necessary prior Authorisation is obtained;

• (b) where the Lender is novating any of its rights and obligations under a Transaction Document the Borrower gives its prior consent to the novation which consent must not be unreasonably withheld and is deemed given if no response is received within 15 days of a request for consent; and

• (c) the proposed assignee becomes a party to this deed as a New Lender by executing a Lender Accession Deed in accordance with clause 14.

13.3 Assist

Each party must do any thing which a Lender reasonably requests including, executing any documents or amending any Transaction Document of that Lender (other than this deed), to effect any transfer, assignment, novation or substitution under this clause 13.

13.4 Securitisation permitted

• (a) A Lender may, without having to obtain the consent of or notify a Transaction Party, assign, transfer, sub-participate or otherwise deal with any of its rights under a Transaction Document to a trustee of a trust, a company or any other entity which in each case is established for the purposes of securitisation ( Securitisation Dealing ) provided that the Lender remains the Lender on record.

• (b) Despite any Securitisation Dealing by a Lender:

• (1) the Lender must continue to perform all its obligations under this deed; and

• (2) any amount paid by the Transaction Party to the Lender will satisfy the Transaction Party’s obligation to make that payment until the Transaction Party is given notice by the Lender of the Securitisation Dealing and directed by the Lender to pay any amount payable by the Transaction Party under this deed to the relevant assignee, transferee or sub-participant.

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14 New Lenders and Additional Transaction Parties

13.5 Participation permitted

The Lender may grant a participation interest (being a right to share in the financial benefits of this deed, without any rights against a Transaction Party) in any of the Lender’s rights and benefits under the Transaction Documents of that Lender to any other person without having to obtain the consent of or to notify a Transaction Party.

13.6 Lending Office

• (a) The Lender may change its Lending Office at any time.

• (b) The Lender must promptly notify Sims of the change.

13.7 No increase in costs

If a Lender assigns or novates any of its rights or obligations under any Transaction Document or changes its Lending Office, no Transaction Party is required to pay any net increase in the aggregate amount of costs, Taxes, fees or charges which is a direct consequence of the transfer or assignment or change of Lending Office.

• 14 New Lenders and Additional Transaction Parties

14.1 New Lenders

A bank or other financial institution which is not an Original Lender may become a Lender for the purposes of this deed by entering into a duly completed and executed Lender Accession Deed with Sims (on behalf of itself and each other Transaction Party).

14.2 Retired Lenders

A Lender will no longer be bound by the Transaction Documents of that Lender immediately upon notification by the Lender to Sims that all obligations of the Transaction Parties to the Lender have been discharged and released.

14.3 Additional Borrowers

Sims may request that any of its wholly owned Subsidiaries becomes an Additional Borrower. That Subsidiary shall become an Additional Borrower if:

• (a) the Lender approves the addition of that Subsidiary as an Additional Borrower;

• (b) Sims delivers to each Lender a duly completed and executed Accession Deed for the accession of that Subsidiary as an Additional Guarantor and Additional Borrower;

• (c) Sims confirms that no Default is continuing or would occur as a result of that Subsidiary becoming an Additional Guarantor and Additional Borrower; and

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15 Representatives

• (d) each Lender has received all of the documents and other evidence listed in Schedule 4 in relation to that Additional Borrower, each in form and substance satisfactory to it.

14.4 Additional Guarantors

Sims may request that any of its wholly owned Subsidiaries become an Additional Guarantor. That Subsidiary shall become an Additional Guarantor if:

• (a) Sims delivers to each Lender an original counterpart of a duly completed and executed Accession Deed; and

• (b) Sims confirms that no Default is continuing or would occur as a result of that Subsidiary becoming an Additional Guarantor; and

• (c) each Lender has received all of the documents and other evidence listed in Schedule 4 in relation to that Additional Guarantor, each in form and substance satisfactory to it.

14.5 Repetition of Representations

Delivery of an Accession Deed to a Lender constitutes confirmation by the relevant Subsidiary that the representations and warranties in the Transaction Documents of that Lender are true and correct in relation to it as at the date of delivery as if made by reference to the facts and circumstances then existing.

• 15 Representatives

15.1 Lender as agent or trustee

If a Lender or any other person acts as an agent or trustee ( Facility Agent ) on behalf of any other Lenders in respect of any Transaction Document then as between the Facility Agent and those Lenders and the Transaction Parties in relation to, but subject to the terms of, those Transaction Documents:

• (a) any information, consent, approval, waiver, variation or notice under this deed that is able or required to be given:

• (1) by one or more of those Lenders shall be given only by the Facility Agent on behalf of those Lenders; and

• (2) to one or more of those Lenders may be given to the Facility Agent on behalf of those Lenders (and if given to the Facility Agent is regarded as given to each such Lender);

• (b) without limiting clause 15.1(a), any notice provided for in this deed relating to or given consequent upon a breach or default or Event of Default under a Transaction Document to which those Lenders are party shall only be given by the Facility Agent on behalf of those Lenders; and

• (c) each Transaction Party may assume, without the necessity for enquiry, that the Facility Agent is duly appointed and that anything done or purported to be done

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16 Saving provisions

by the Facility Agent under a Transaction Document to which those Lenders are party has been authorised by the requisite Lender or Lenders under those Transaction Documents.

15.2 Transaction Parties’ agent

• (a) All communications under the Transaction Documents to and from the Transaction Parties may be sent to or by Sims.

• (b) Each Transaction Party (other than Sims) by its execution of this deed or an Accession Deed irrevocably appoints Sims to act on its behalf as its agent and attorney in relation to the Transaction Documents and irrevocably authorises:

• (1) Sims on its behalf to supply all information concerning itself contemplated by this deed to any Lender;

• (2) Sims on its behalf to give and receive all notices and instructions under the Transaction Documents;

• (3) Sims on its behalf to agree and sign all documents under or in connection with the Transaction Documents (including any Accession Deed, Lender Accession Deed or amendment, supplement or variation to any Transaction Document) without further reference to or the consent of that Transaction Party; and

• (4) each Lender to give any notice, demand or other communication to that Transaction Party pursuant to the Transaction Documents to Sims,

and in each case the Transaction Party will be bound by any act of Sims under this clause 15.2.

• 16 Saving provisions

16.1 No merger of security

• (a) Nothing in this deed merges, extinguishes, postpones, lessens or otherwise prejudicially affects:

• (1) any Encumbrance or indemnity in favour of the Lender; or

• (2) any Power.

• (b) No other Encumbrance or Transaction Document which the Lender has the benefit of in any way prejudicially affects any Power.

16.2 Exclusion of moratorium

To the extent not excluded by law, a provision of any legislation which directly or indirectly:

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16 Saving provisions

• (a) lessens, varies or affects in favour of a Transaction Party any obligations under a Transaction Document; or

• (b) stays, postpones or otherwise prevents or prejudicially affects the exercise by the Lender of any Power,

is negatived and excluded from each Transaction Document and all relief and protection conferred on a Transaction Party by or under that legislation is also negatived and excluded.

16.3 Conflict

Where any right, power, authority, discretion or remedy conferred on the Lender or an Attorney by any Transaction Document is inconsistent with the powers conferred by applicable law then, to the extent not prohibited by that law, those conferred by applicable law are regarded as negatived or varied to the extent of the inconsistency.

16.4 Consents

• (a) Whenever the doing of any thing by a Transaction Party is dependent on the consent of the Lender, the Lender may withhold its consent or give it conditionally or unconditionally in its absolute discretion, unless expressly stated otherwise in a Transaction Document.

• (b) Any conditions imposed on a Transaction Party by the Lender under clause 16.4(a) must be complied with by the Transaction Party.

16.5 Principal obligations

• This deed and each Collateral Security is:

• (a) a principal obligation and is not ancillary or collateral to any other Encumbrance (other than another Collateral Security) or other obligation; and

• (b) independent of, and unaffected by, any other Encumbrance or other obligation which the Lender may hold at any time in respect of the Outstanding Moneys.

16.6 Non-avoidance

If any payment by a Transaction Party to the Lender is avoided for any reason including any legal limitation, disability or incapacity of or affecting the Transaction Party or any other thing, and whether or not:

• (a) any transaction relating to the Outstanding Moneys was illegal, void or substantially avoided; or

• (b) any thing was or ought to have been within the knowledge of the Lender, the Transaction Party:

• (c) as an additional, separate and independent obligation, indemnifies the Lender against that avoided payment; and

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16 Saving provisions

• (d) acknowledges that any liability of the Transaction Party under the Transaction Documents and any right or remedy of the Lender under the Transaction Documents is the same as if that payment had not been made.

16.7 Set-off authorised

• If a Transaction Party does not pay any amount when due and payable by it to the Lender under a Transaction Document, the Lender may:

• (a) apply any credit balance in any currency in any account of the Transaction Party with the Lender in or towards satisfaction of that amount; and

• (b) effect any currency conversion which may be required to make an application under clause 16.7(a).

16.8 Lender’s certificates and approvals

• (a) A certificate signed by any Officer of the Lender in relation to any amount, calculation or payment under any Transaction Document is sufficient evidence of that amount, calculation or payment unless the contrary is proved.

• (b) Where any provision of a Transaction Document requires the Lender’s approval, that approval will not be effective unless and until it is provided in writing.

16.9 No reliance or other obligations and risk assumption

Each Transaction Party acknowledges and confirms that:

• (a) it has not entered into any Transaction Document in reliance on any representation, warranty, promise or statement made by or on behalf of the Lender;

• (b) in respect of the transactions evidenced by the Transaction Documents, the Lender has no obligations other than those expressly set out in the Transaction Documents; and

• (c) in respect of interest rates or exchange rates, the Lender is not liable for:

• (1) any movement in interest rates or exchange rates;

• (2) any information, advice or opinion provided by the Lender or any person on behalf of the Lender, even if provided at the request of a Transaction Party (it being acknowledged by each Transaction Party that such matters are inherently speculative);

• (3) any information, advice or opinion provided by the Lender or any person on behalf of the Lender, even if relied on by a Transaction Party; or

• (4) any information, advice or opinion provided by the Lender or any person on behalf of the Lender, even if provided incorrectly or negligently.

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17 General

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16.10 Power of attorney

• (a) For consideration received, each Transaction Party irrevocably appoints the Lender and each Officer of the Lender as the attorney of the Transaction Party to:

• (1) execute and deliver all documents; and

• (2) do all things,

which are necessary or desirable to give effect to each Transaction Document.

• (b) An attorney appointed under clause 16.10(a) may appoint a substitute attorney to perform any of its powers.

• (c) An Attorney appointed under clause 16.10(a) may only exercise any of its powers under this clause 16.10 whilst an Event of Default is subsisting.

• 17 General

17.1 Confidential information

The Lender must not disclose to any person:

• (a) any Transaction Document; or

• (b) any information about any Transaction Party,

except:

• (c) in connection with a permitted assignment, novation, participation or securitisation under clause 13, or a proposed permitted assignment, novation, participation or securitisation under clause 13, where the disclosure is made on the basis that the recipient of the information will comply with this clause 17.1 in the same way that the Lender is required to do;

• (d) to any professional or other adviser consulted by it in relation to any of its rights or obligations under the Transaction Documents;

• (e) to the Reserve Bank of Australia, the Australian Tax Office or any Government Agency requiring disclosure of the information;

• (f) in connection with the enforcement of its rights under the Transaction Documents;

• (g) where the information is already in the public domain, or where the disclosure would not otherwise breach any duty of confidentiality;

• (h) if required by law; or

• (i) otherwise with the prior written consent of the relevant Transaction Party (such consent not to be unreasonably withheld).

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17.2 Transaction Party to bear cost

Any thing which must be done by a Transaction Party under any Transaction Document, whether or not at the request of the Lender, must be done at the cost of the Transaction Party.

17.3 Dispute Resolution

• (a) If an Issue or a circumstance that is reasonably likely to result in a Issue, arises Sims and the Lender must not commence any court proceedings relating to the Issue unless it has complied with the provisions of this clause 17.3, except to seek urgent interlocutory relief.

• (b) If Sims or the Lender become aware of an Issue or a circumstance that is reasonably likely to result in an Issue, it must promptly notify the other ( Initial Notice ), and if the Issue is not resolved within ten (10) Business Days from the date that of that Initial Notice, (excluding the date of that Initial Notice) (or such other period as agreed to in writing between Sims and the Lender), then either Sims or the Lender may give a written notice to the other specifying the nature and details of the Issue ( Notification ).

• (c) If an Issue is resolved within ten (10) Business Days from the date on which Initial Notice is provided (excluding the date on which Initial Notice is given) (or such other period as agreed to in writing between Sims and the Lender), Sims and the Lender must exchange written acknowledgement of such resolution prior to the end of the ten (10) Business Day period.

• (d) Once a Notification of an Issue is given in accordance with clause 17.3(b), a Dispute is taken to have arisen. If no Notification is given in accordance with clause 17.3(b) or the Issue is resolved and written acknowledgement has been exchanged between Sims and the Lender in accordance with clause 17.3(c), a Dispute will not be taken to have arisen in relation to any Issue and the provisions of this clause 17.3 will no longer apply. If the provisions of this clause 17.3 no longer apply as a result of the failure of either Sims or the Lender to give a Notification, the matter or thing asserted by either Sims or the Lender which gave rise to the Issue will be disregarded.

• (e) If Sims and the Lender do not resolve a Dispute within ten (10) Business Days after the Notification is given (excluding the date on which the Notification is given) (or such other period as agreed to in writing between Sims and the Lender) either Sims or the Lender may submit the Dispute to expert determination.

• (f) If the Dispute is to be referred to expert determination under clause 17.3(e):

• (1) both Sims and the Lender may nominate an independent expert with relevant expertise in accounting, legal and commercial matters to act as expert and submit this nomination to the other within the earlier of twelve (12) Business Days after the Notification is given (excluding the date on which the Notification is given), or two (2) Business Days following a decision by Sims and the Lender to submit the Dispute to expert determination (excluding the date on which that decision is reached) (or such other period as agreed to in writing between Sims and the Lender);

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17 General

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• (2) if only the Lender or only Sims nominates an expert by the time specified in, and otherwise in accordance with, clause 17.3(f) (1), the nominated expert will be taken to have been agreed to by both Sims and the Lender and that expert will be validly appointed;

• (3) if Sims and the Lender do not agree on the appointment of an expert within three (3) Business Days after both expert nominations have been submitted (excluding the date on which both nominations have been submitted), the matter will be referred to the President of the Institute of Chartered Accountants of Australia who will nominate an expert to determine the Dispute and both Sims and the Lender will accept this nomination;

• (4) where Sims is engaged in a dispute with any of its other lenders (which have adopted a dispute resolution clause in substantially the same form as this clause 17.3) in relation to the same subject matter as a Dispute or Issue between Sims and the Lender, the Lender agrees to the common appointment of an expert to resolve the disputes simultaneously and an expert appointed in these circumstances can only be appointed if the expert accepts a common appointment;

• (5) the terms of the expert’s retainer must provide that in resolving the Dispute the expert will, to the extent relevant, be subject to the then current ACDC Guidelines for Expert Determination, and will use all reasonable endeavours to ensure that if a Dispute relates to a current Calculation Period a decision is reached prior to the Calculation Date for that Calculation Period;

• (6) the terms of the expert’s retainer must provide that the expert must provide a decision as soon as reasonably practicable and in any event no later than the five (5) Business Days from the date of referral (excluding the date of referral) (or such other period as agreed to in writing between Sims and the Lender);

• (7) the decision of the expert is final and binding on the Lender and the Transaction Parties except in the case of manifest error; and

• (8) if, for any reason:

• (A) an expert is not appointed within five (5) Business Days of the expert appointment decision being referred to the President of the Institute of Chartered Accountants of Australia (excluding the date on which the matter is referred); or

• (B) the appointed expert provides Sims and the Lender with written confirmation that the expert is unable to reach a decision in relation to the Dispute,

  • the provisions of this clause 17.3 will no longer apply to the Dispute and each of Sims and the Lender may:

• (C) commence court proceedings; and/or

• (D) pursue any other remedies that are available to the relevant party,

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17 General

in relation to the matter or thing forming the subject matter of the Dispute.

• (g) If a Dispute or Issue first arises prior to the end of a Calculation Period and is not resolved in accordance with this clause 17.3 by the end of that Calculation Period, Sims and the Lender agree to use reasonable endeavours to resolve the Dispute or Issue as soon as possible following the relevant Calculation Date and in any event no later than 30 Business Days following Sims and the Lender first becoming aware of the Issue or Dispute (excluding the date on which both Sims and the Lender first become aware of the Issue or Dispute) (or such other period as agreed to in writing between Sims and the Lender).

• (h) The Lender agrees that, prior to the resolution of the Dispute or Issue in accordance with the provisions of this clause 17.3, or the termination of the dispute resolution process as contemplated by clause 17.3(f)(8), the subject matter of any Dispute or Issue may not be taken into account in determining whether Sims is in breach of any of the financial undertakings contained in clause 4.17 of this deed that require EBITDA to be calculated.

• (i) Sims must bear the costs of complying with this clause 17.3 and comply with the obligations under the Transaction Documents during the dispute resolution process contained in this clause 17.3.

• (j) In acting under the provisions of this clause 17.3 Sims and the Lender must at all times use reasonable endeavours to resolve any Dispute or Issue.

• (k) Each Transaction Party represents and warrants for the benefit of each Lender that each Other Facility Document that requires or contemplates adjustments to EBITDA, contains a dispute resolution clause in substantially the same form as this clause 17.3.

17.4 Notices

• (a) Any notice or other communication including, any request, demand, consent or approval, to or by a party to any Transaction Document must be in legible writing and in English addressed to the party in accordance with its details set out below in respect of any Transaction Party and in Schedule 1 with respect to a Lender or as specified to the sender by the party by notice.

Notices to a Transaction Party:

Address: Sir Josephs Banks Corporate Park Suite 3, Level 2 32-34 Lord Street Botany NSW 2019 Fax no: +61 2 8113 1620 Email address: frank.moratti@simsmm.com Department/officer: Frank Moratti Company Secretary

• (b) If the sender is a company, any such notice or other communication must be signed by an Officer of the sender.

• (c) Any such notice or other communication is regarded as being given by the sender and received by the addressee:

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• 17 General

• (1) if by delivery in person, when delivered to the addressee;

• (2) if by post, on delivery to the addressee; or

• (3) if by facsimile, when received by the addressee in legible form,

but if the delivery or receipt is on a day which is not a Business Day or is after 4.00pm (addressee’s time) it is regarded as received at 9.00am on the following Business Day.

• (d) Any such notice or other communication can be relied on by the addressee and the addressee is not liable to any other person for any consequences of that reliance if the addressee believes it to be genuine, correct and authorised by the sender.

• (e) A facsimile transmission is regarded as legible unless the addressee telephones the sender within 2 hours after the transmission is received or regarded as received under clause 17.4(c) and informs the sender that it is not legible.

17.5 Governing law and jurisdiction

• (a) This deed is governed by the laws of New South Wales.

• (b) Each Transaction Party irrevocably submits to the non-exclusive jurisdiction of the courts of New South Wales.

• (c) Each Transaction Party irrevocably waives any objection to the venue of any legal process on the basis that the process has been brought in an inconvenient forum.

• (d) Each Transaction Party irrevocably waives any immunity in respect of its obligations under this deed that it may acquire from the jurisdiction of any court or any legal process for any reason including the service of notice, attachment before judgment, attachment in aid of execution or execution.

• (e) Each Transaction Party (other than Sims) irrevocably appoints Sims in relation to proceedings in New South Wales as its agent to receive service of any legal process on its behalf without excluding any other means of service permitted by the law of New South Wales and Sims irrevocably accepts that appointment.

17.6 Prohibition and enforceability

• (a) Any provision of, or the application of any provision of, any Transaction Document or any Power which is prohibited in any jurisdiction is, in that jurisdiction, ineffective only to the extent of that prohibition.

• (b) Any provision of, or the application of any provision of, any Transaction Document which is void, illegal or unenforceable in any jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions in that or any other jurisdiction.

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17 General

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17.7 Waivers

• (a) Waiver of any right arising from a breach of this deed or of any Power arising on default under this deed or on the occurrence of an Event of Default must be in writing and signed by the party granting the waiver.

• (b) A failure or delay in exercise, or partial exercise, of:

• (1) a right arising from a breach of this deed or the occurrence of an Event of Default; or

• (2) a Power created or arising on default under this deed or on the occurrence of an Event of Default,

does not result in a waiver of that right or Power.

• (c) A party is not entitled to rely on a delay in the exercise or non-exercise of a right or Power arising from a breach of this deed or on a default under this deed or on the occurrence of an Event of Default as constituting a waiver of that right or Power.

• (d) A party may not rely on any conduct of another party as a defence to exercise of a right or Power by that other party.

• (e) This clause may not itself be waived except in writing.

17.8 Variation

A variation of any term of this deed must be in writing and signed by the parties.

17.9 Cumulative rights

The Powers are cumulative and do not exclude any other right, power, authority, discretion or remedy of the Lender or Attorney.

17.10 Counterparts

• (a) This deed may be executed in any number of counterparts.

• (b) All counterparts, taken together, constitute one instrument.

• (c) A party may execute this deed by signing any counterpart.

17.11 Attorneys

Each of the attorneys executing this deed states that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

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	Shedules
Table of contents
Parties	65
Part 1 - Original Borrowers	65
Part 2 - Original Guarantors	67
Part 3 - Original Lender	71
Verification certificate	72
Compliance Certificate	75
Conditions Precedent	77

page 64

Schedule 1

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Parties

Clause 1.2 (Definitions)

Part 1 — Original Borrowers

Name Sims Metal Management Limited Sims Group Australia Holdings Limited Sims Aluminium Pty Limited Sims Group UK Limited Sims Group UK Holdings Limited Mirec B.V. Sims Recycling Solutions AB Sims Group USA Corporation Sims Group Global Trade Corporation North Carolina Resource Conservation LLC	ABN/ACN/ARBN 69 114 838 630 37 008 634 526 93 004 370 905 3242331 2904307 17073024 N/A N/A N/A N/A	Jurisdiction of incorporation / registration /organisation
		Australia Australia Australia United Kingdom United Kingdom The Netherlands Sweden Delaware Delaware North Carolina

page 65

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<Schedule 1 Parties

Name Sims Group USA Holdings Corporation Schiabo Larovo Corporation Simsmetal East LLC Simsmetal West LLC Metal Management, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Memphis, L.L.C. Metal Management Midwest, Inc. Metal Management Mississippi, Inc. Metal Management Northeast, Inc. Metal Management Ohio, Inc. Metal Management West, Inc. Proler Southwest LP Metal Dynamics Detroit LLC	ABN/ACN/ARBN N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A	Jurisdiction of incorporation / registration /organisation
		Delaware Delaware Delaware Delaware Delaware Delaware Arizona Delaware Tennessee Illinois Delaware New Jersey Ohio Colorado Texas Delaware

page 66

<Schedule 1 Parties

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Part 2 — Original Guarantors

Name	ABN/ACN/ARBN	Jurisdiction of incorporation/ registration
Sims Group Australia Holdings Limited Sims Metal Management Limited Simsmetal Holdings Pty Limited Simsmetal Services Pty Limited Sims Manufacturing Pty Limited Sims Industrial Pty Limited Sims Energy Pty Limited Sims Aluminium Pty Limited Sims Group UK Limited Sims Group UK Holdings Limited Mirec B.V. Sims Recycling Solutions AB Simsmetal Industries Limited Sims M+R GmbH Sims Group German Holdings GmbH Sims Metal Management Asia Limited (previously known as Sims Asia Holdings Limited)	37 008 634 526 69 114 838 630 97 000 021 563 76 000 166 987 13 004 332 870 95 000 090 479 42 009 667 752 93 004 370 905 3242331 2904307 17073024 N/A N/A N/A N/A N/A	Australia Australia Australia Australia Australia Australia Australia Australia United Kingdom United Kingdom The Netherlands Sweden New Zealand Germany Germany Hong Kong

page 67

<Schedule 1 Parties

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Name Sims Group Recycling Solutions Canada Ltd Sims Group Canada Holdings Limited Sims Group USA Corporation Sims Group Global Trade Corporation North Carolina Resource Conservation, LLC Sims Group USA Holdings Corporation SHN Co., LLC HNE Recycling LLC HNW Recycling LLC Schiabo Larovo Corporation Simsmetal East LLC Simsmetal West LLC Sims Recycling Solutions Holdings Inc. (formerly Sims Recycling Solutions, Inc.) Sims Recycling Solutions, Inc. (formerly United Refining & Smelting Co.)	ABN/ACN/ARBN N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A	Jurisdiction of incorporation/ registration
		Canada Canada Delaware Delaware North Carolina Delaware Delaware Delaware Delaware Delaware Delaware Delaware Illinois Illinois

page 68

<Schedule 1 Parties

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Name Metal Management, Inc. CIM Trucking, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Metal Management Midwest, Inc. Metal Management Mississippi, Inc. Metal Management New Haven, Inc. Metal Management Northeast, Inc. Metal Management Ohio, Inc. Metal Management Pittsburgh, Inc. Metal Management Proler Southwest, Inc. SMM — North America Trade Corporation Metal Management West Coast Holdings, Inc. Metal Management West, Inc.	ABN/ACN/ARBN N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A	Jurisdiction of incorporation/ registration
		Delaware Illinois Delaware Arizona Delaware Illinois Tennessee Illinois Delaware Delaware New Jersey Ohio Delaware Delaware Delaware Delaware Colorado

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<Schedule 1 Parties

Name MM Metal Dynamics Holdings, Inc. Naporano Iron & Metal, Inc. New York Recycling Ventures, Inc. Proler Southwest GP, Inc. Proler Southwest LP Reserve Iron & Metal Limited Partnership Metal Dynamics LLC Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC Sims Municipal Recycling of New York LLC	ABN/ACN/ARBN N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A	Jurisdiction of incorporation/ registration
		Delaware Delaware Delaware Delaware Texas Delaware Delaware Delaware Delaware Delaware

page 70

<Schedule 1 Parties

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Part 3 — Original Lender Name Commonwealth Bank of Australia	ABN/ACN/ARBN ABN 48 123 123 124	Address and service details
		Address:201 Sussex Street, Darling Park Tower 1, Sydney, New South Wales 2000, Australia Attention:Senior Vice President, Institutional Banking & Markets. Facsimile:61 2 9118 4003

page 71

Schedule 2

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Verification certificate

Schedule 4

[To be signed by a director of the relevant company, or in the case of a corporation or entity incorporated or organised under the laws of a state of the United States of America, by a secretary or assistant secretary of that entity.]

To: [ ] ( Lender )

Verification Certificate

We refer to the Common Terms Deed dated 2 November 2009 ( Common Terms Deed ) between Sims Metal Management Limited (as Sims ), each party listed in Part 1 of Schedule 1 of that deed as Original Borrowers, each party listed in Part 2 of Schedule 1 of that deed as Original Guarantors and the person listed in Part 3 of Schedule 1 of that deed as Original Lender.

Capitalised terms in this certificate have the meaning given in the Common Terms Deed unless otherwise defined herein.

I am a director of [ insert company name ] (the Company ).

I hereby certify that:

• 1 Attachments

Attached are true, complete and up-to-date copies (or, where specified below, originals) of the following and there have been no amendments or variations since the date of the copy or original:

• (a) power of attorney : A power of attorney under which the Company executed the Transaction Documents of the Lender to which it is or will be a party, and, if required by the Lender, evidence of its stamping and registration.

• (b) extract of board minutes : Extracts of minutes of meeting of directors of the Company which evidences the resolutions:

• (1) authorising the execution and delivery of and observance of obligations under the Transaction Documents of the Lender to which it is or will be a party;

• (2) authorising the appointment of Authorised Officers of the Company; and

• (3) explaining why the directors believe it is in the best interests of the Company [this sentence to be inserted in relation to all foreign companies]

together with any other document which evidences any other necessary corporate or other action of the Company in connection with the Transaction Documents of the Lender to which it is or will be a party;

page 72

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<Schedule 2 Verification certificate

• (c) extract of Shareholder Minutes : [Extracts of minutes of a meeting of all members of the Company which evidences the unanimous resolutions of those shareholders authorising execution and delivery of and observance of obligations under the Transaction Documents of the Lender to which it is a party;] [ to be inserted where shareholder resolutions are required to authorise the Company’s execution and performance of the Transaction Documents ]

• (d) certificate of incorporation and constituent documents : This Verification Certificate attaches a copy of the certificate of incorporation and constituent documents for the Company [or an original certificate signed by a director of the Company confirming that there are no constituent documents], including, in the case of each Guarantor other than Sims which is incorporated in Australia evidence that the constitution incorporates a provision which expressly authorises the directors of each such corporation to act in the best interests of its holding company;

• (e) legal opinion : An opinion in favour of the Lender by lawyers acceptable to the Lender in the jurisdiction of incorporation or organisation of the Company, in respect of the Company and due execution of, and enforceability against, the Company of the Transaction Documents of the Lender to which it is a party;

• (f) Authorisations : All Authorisations (if any) necessary for the Company to execute and observe obligations under and enforce the Transaction Documents of the Lender;

• (g) specimen signatures : Specimen signatures of each Authorised Officer of the Company; and

• (h) [certificate of good standing : A certificate from the Secretary of State of the State of incorporation or organisation of any United States of America incorporated or organised Company, certifying the Company’s good standing in that State.][ In the case of each Transaction Party incorporated or organised in a State of the United States ]

• 2 Confirmations, representations and warranties

• I confirm:

• (a) that borrowing or guaranteeing or securing, as appropriate, the commitments under all Transaction Documents of the Lender, would not cause any borrowing, guarantee, security or similar limit binding on the Company to be exceeded;

• (b) that the Company is solvent and able to pay its debts as and when they fall due [ delete in the case of a Company incorporated or organised under the laws of a state of the United States of America ];

• (c) that the representations and warranties set out in clause 3 (Representations and Warranties) of the Common Terms Deed are true and correct;

• (d) the Company is not prevented by Chapter 2E or any other provision of the Corporations Act (or similar laws under the laws of any other jurisdiction which may be applicable to it) from entering into and performing any of the Transaction Documents of the Lender to which it is a party or the giving of effect to the transactions contemplated by them;

• (e) that Chapter 2J.3 of the Corporations Act (or similar laws under the laws of any other jurisdiction which may be applicable to it) has not been and will not be breached by the

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<Schedule 2 Verification certificate

• Company entering into the Transaction Documents of the Lender to which it is a party or the giving of effect to the transactions contemplated by them; and

• (f) that the entry by the Company into the Transaction Documents of the Lender to which it is a party and the giving of effect to the transactions contemplated by them is in its best interests and for the purposes of its business.

date

sign here �

Authorised Officer

print name

page 74

Schedule 3

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Compliance Certificate

Clause 4.1(c)

To: [ ] ( Lender )

Compliance Certificate

We refer to the Common Terms Deed dated 2 November 2009 ( Common Terms Deed ) between Sims Metal Management Limited (as Sims ), each party listed in Part 1 of Schedule 1 of that deed as Original Borrowers, each party listed in Part 2 of Schedule 1 of that deed as Original Guarantors and the person listed in Part 3 of Schedule 1 of that deed as Original Lender.

Capitalised terms in this certificate have the meaning given in the Common Terms Deed unless otherwise defined herein.

• For the Calculation Period ended on [Insert Calculation Date] ( Calculation Date ):

• (a) the ratio of Financial Indebtedness to EBITDA for the Calculation Period ending on that Calculation Date is not greater than 3.0:1;

• (b) the ratio of EBITDA to Net Interest Expense for the Calculation Period ending on that Calculation Date is not less than 3.5:1,

• (c) Tangible Net Worth on that Calculation Date is at least 85% of the Tangible Net Worth calculated for the last Calculation Date of the preceding financial year.

as is evidenced by the attached supporting calculations.

• The Guarantors (excluding any German Guarantors):

• (a) at all times owned, in aggregate, at least 80% of the Total Tangible Assets of the Sims Group; and

• (b) generate at least 80% of the EBITDA for the Calculation Period ending on the Calculation Date,

• as is evidenced by the attached supporting calculations except [ insert details of any circumstances relevant to clause 4.18(b) including the dates by which subsidiaries will become additional guarantors as required ].

Each Subsidiary that owned at least 5% of Total Tangible Assets at any time in the Calculation Period or generated at least 5% of EBITDA for the Calculation Period ending on the Calculation Date, is a Guarantor (except [ insert details of any circumstances relevant to clause 4.18(b) including the dates by which subsidiaries will become additional guarantors as required ]), as is evidenced by the attached supporting calculations.

page 75

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<Schedule 3 Compliance certificate

Since the date of the last Compliance Certificate no condition or event that constitutes a Default or Review Event has occurred or is subsisting, except [insert details] .

The representations and warranties in the Common Terms Deed are true and correct as though they have been made at the date of this certificate in respect of the facts and circumstances then subsisting, except [insert details] .

For and on behalf of

Sims Metal Management Limited

ABN 69 114 838 630

date

sign here �

Director

print name

sign here �

Director / Secretary

print name

page 76

Schedule 4

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Conditions Precedent

Clause 14

• (a) An Accession Deed duly executed by the Additional Guarantor or Additional Borrower (as the case may be);

• (b) A Verification certificate in the form of Schedule 2 (or in the case of an Additional Guarantor or Additional Guarantor incorporated outside Australia, such other form as the Lender may require) in respect of the Additional Guarantor or Additional Borrower (as the case may be) together with each attachment referred to in it;

• (c) Duly executed forms, notices and other documents which are required in order to register or file with the appropriate Government Agency any document referred to in this Schedule 4; and

• (d) Such evidence and information, including legal opinions, in relation to the execution of the documents referred to in this Schedule 4 as the Lender reasonably requires.

page 77

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Signing page Executed as a deed Borrower Signed sealed and delivered by Sims Metal Management Limited by sign here � Company Secretary/Director print name sign here � Director print name Borrower Signed sealed and delivered by Sims Group Australia Holdings Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 78

Signing page

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Borrower Signed sealed and delivered by Sims Aluminium Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name Borrower Signed sealed and delivered by Sims Group UK Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 79

Signing page

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Borrower Signed sealed and delivered by Sims Group UK Holdings Limited by sign here � Company Secretary/Director print name sign here � Director print name Borrower Signed sealed and delivered by Mirec B.V. by sign here � Company Secretary/Director print name sign here � Director print name in the presence of sign here � Witness print name

page 80

Signing page

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Borrower Signed sealed and delivered by Sims Recycling Solutions AB by sign here � Company Secretary/Director print name sign here � Director print name in the presence of sign here � Witness print name

page 81

Signing page

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Borrower

Signed sealed and delivered for Sims Group USA Corporation by its officer sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of sign here � Witness

print name

Borrower Signed sealed and delivered for Sims Group Global Trade Corporation by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of sign here � Witness

print name

page 82

Signing page

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sign here� print name sign here� print name sign here� print name sign here� print name	Borrower Signed sealed and delivered for North Carolina Resource Conservation, LLC by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Borrower Signed sealed and delivered for Sims Group USA Holdings Corporation by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness

page 83

Signing page

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Borrower

Signed sealed and delivered for Schiabo Larovo Corporation by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Borrower

Signed sealed and delivered for Simsmetal East LLC by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 84

Signing page

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Borrower Signed sealed and delivered for Simsmetal West LLC by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Metal Management, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 85

Signing page

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Borrower Signed sealed and delivered for Metal Management Alabama, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Metal Management Arizona, L.L.C. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 86

Signing page

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Borrower Signed sealed and delivered for Metal Management Connecticut, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Metal Management Memphis, L.L.C. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 87

Signing page

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Borrower Signed sealed and delivered for Metal Management Midwest, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Metal Management Mississippi, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 88

Signing page

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Borrower Signed sealed and delivered for Metal Management Northeast, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Metal Management Ohio, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 89

Signing page

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Borrower Signed sealed and delivered for Metal Management West, Inc. by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name Borrower Signed sealed and delivered for Proler Southwest LP by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name in the presence of sign here � Witness print name

page 90

Signing page

==> picture [66 x 16] intentionally omitted <==

Borrower

sign here� print name sign here� print name sign here� print name sign here� print name	Signed sealed and delivered for Metal Dynamics Detroit LLC by its officer
	Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
	in the presence of
	Witness
	Guarantor Signed sealed and delivered by Sims Group Australia Holdings Limited by
	Company Secretary/Director
	Director

page 91

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor Signed sealed and delivered by Sims Metal Management Limited by sign here � Company Secretary/Director print name sign here � Director print name Guarantor Signed sealed and delivered by Sims Aluminium Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 92

Signing page Guarantor Signed sealed and delivered by Simsmetal Holdings Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name Guarantor Signed sealed and delivered by Simsmetal Services Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 93

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor Signed sealed and delivered by Sims Manufacturing Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name Guarantor Signed sealed and delivered by Sims Industrial Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 94

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor Signed sealed and delivered by Sims Energy Pty Limited by sign here � Company Secretary/Director print name sign here � Director print name Guarantor Signed sealed and delivered by Sims Group UK Limited by sign here � Company Secretary/Director print name sign here � Director print name

page 95

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor Signed sealed and delivered by Sims Group UK Holdings Limited by sign here � Company Secretary/Director print name sign here � Director print name Guarantor Signed sealed and delivered by Mirec B.V. by sign here � Company Secretary/Director print name sign here � Director print name in the presence of sign here � Witness print name

page 96

sign here� print name sign here� print name sign here� print name sign here� print name sign here� print name	Guarantor Signed sealed and delivered by Sims Recycling Solutions AB by Company Secretary/Director Director in the presence of Witness Guarantor Signed sealed and delivered for Simsmetal Industries Limited by its officer Director in the presence of Witness	Signing page
		Director

page 97

==> picture [66 x 16] intentionally omitted <==

Signing page

sign here� print name sign here� print name sign here� print name sign here� print name	Guarantor Signed sealed and delivered for Sims M+R GmbHby its officer Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed in the presence of Witness Guarantor Signed sealed and delivered for Sims Group German Holdings GmbH by its officer Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed in the presence of Witness
		Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed
		Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

page 98

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Signing page

sign here� print name sign here� print name sign here� print name print title sign here� print name

Guarantor THE COMMON SEAL of ) SIMS METAL MANAGEMENT ASIA LIMITED ) (PREVIOUSLY KNOWN AS ) SIMS ASIA HOLDINGS LIMITED) ) was affixed to this Deed ) in the presence of: Officer in the presence of Witness Guarantor Signed sealed and delivered for Sims Group Recycling Solutions Canada Ltd by its officer Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed in the presence of Witness

page 99

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor Signed sealed and delivered for Sims Group Canada Holdings Limited by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed print name print title in the presence of sign here � Witness print name

page 100

Signing page

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Guarantor

Signed sealed and delivered for Sims Group USA Corporation by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name Guarantor Signed sealed and delivered for Sims Group Global Trade Corporation by its officer

sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness print name

page 101

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for North Carolina Resource Conservation, LLC by its officer

sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name in the presence of sign here � Witness print name

Guarantor

Signed sealed and delivered for Sims Group USA Holdings Corporation by its officer sign here � Officer By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name in the presence of sign here � Witness print name

page 102

Signing page

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Guarantor

Signed sealed and delivered for SHN Co., LLC by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for HNE Recycling LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 103

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for HNW Recycling LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Schiabo Larovo Corporation by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 104

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for Simsmetal East LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Simsmetal West LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 105

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for Sims Recycling Solutions Holdings Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Sims Recycling Solutions, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 106

Signing page

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Guarantor

Signed sealed and delivered for Metal Management, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for CIM Trucking, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 107

Signing page

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Guarantor

Signed sealed and delivered for Metal Management Alabama, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Metal Management Arizona, L.L.C. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 108

Signing page

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Guarantor

Signed sealed and delivered for Metal Management Connecticut, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Metal Management Indiana, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 109

Signing page

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Guarantor

Signed sealed and delivered for Metal Management Memphis, L.L.C. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Metal Management Midwest, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 110

Signing page

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Guarantor

Signed sealed and delivered for Metal Management Mississippi, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Metal Management New Haven, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 111

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for Metal Management Northeast, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Metal Management Ohio, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 112

Signing page

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Guarantor

Signed sealed and delivered for Metal Management Pittsburgh, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Metal Management Proler Southwest, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 113

Signing page

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Guarantor

Signed sealed and delivered for SMM — North America Trade Corporation by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Metal Management West Coast Holdings, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 114

Signing page

==> picture [66 x 16] intentionally omitted <==

Guarantor

Signed sealed and delivered for Metal Management West, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for MM Metal Dynamics Holdings, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 115

Signing page

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Guarantor

Signed sealed and delivered for Naporano Iron & Metal, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for New York Recycling Ventures, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 116

Signing page

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Guarantor

Signed sealed and delivered for Proler Southwest GP, Inc. by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

Guarantor

Signed sealed and delivered for Proler Southwest LP by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here �

Witness

print name

page 117

Signing page

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Guarantor

Signed sealed and delivered for Reserve Iron & Metal Limited Partnership by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Metal Dynamics LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 118

Signing page

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Guarantor

Signed sealed and delivered for Metal Dynamics Detroit LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Guarantor

Signed sealed and delivered for Metal Dynamics Indianapolis LLC by its officer

sign here �

Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

page 119

Signing page

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Guarantor

Signed sealed and delivered for Sims Municipal Recycling of New York LLC by its officer

sign here � Officer

By executing this deed the signatory states that the signatory has received no notice of revocation of the authority under which the signatory signs this deed

print name

in the presence of

sign here � Witness

print name

Lender

Signed sealed and delivered for Commonwealth Bank of Australia by its attorney

sign here � Attorney print name in the presence of sign here � Witness print name

page 120

Attachments

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Table of contents

Accession Deed – Additional Guarantors and Additional Borrowers Accession Deed – New Lenders

Page 1

Attachment 1

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Accession Deed – Additional Guarantors and Additional Borrowers

Clauses 1.2 (Definitions) and 14 (New Lenders and Additional Transaction Parties)

Date � This deed poll is made by

Sims Sims Metal Management Limited

ACN 114 838 630 of Sir Joseph Banks Corporate Park, Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

Additional Guarantor [ ]

[ insert ACN/ABN/ARBN ] of [ ]

• Background 1 Under the Common Terms Deed dated 2 November 2009 ( Common Terms Deed ) between Sims Metal Management Limited, each party listed in Part 1 of Schedule 1 of that deed (as Original Borrowers ), each party listed in Part 2 of Schedule 1 of that deed (as Original Guarantors ) and the person listed in Part 3 of Schedule 1 of that deed (as Original Lender ) a person may become a Guarantor[ and Borrower] by execution of this deed poll.

• 2 The Additional Guarantor wishes to become a Guarantor[ and Borrower] on the terms and conditions set out in this deed poll.

This deed poll witnesses as follows:

3 Interpretation

• (a) Words and phrases defined in the Common Terms Deed have the same meaning when used in this deed poll.

page 1

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<Attachment 1 Accession Deed — Additional Guarantors and Additional Borrowers

• (b) In this deed poll, Existing Guarantor has the meaning set out below.

Term Meaning

Existing Guarantor each person which is a Guarantor under the Common Terms Deed at the time of execution of this deed poll.

4 Guarantee

In consideration of, among other things:

• (a) forbearance by the Lender to require repayment of the Outstanding Moneys in full; and

• (b) the payment to the Additional Guarantor of $10 (receipt of which is acknowledged),

the Additional Guarantor jointly and severally with each Existing Guarantor irrevocably and unconditionally guarantees to the Lender the payment of the Outstanding Moneys on the terms contained in the Common Terms Deed (including clause 7 of the Common Terms Deed).

• 5 Representations and warranties

The Additional Guarantor represents and warrants to, and for the benefit of each Lender, as set out in clause 3.1 of the Common Terms Deed, on the basis that:

• (a) each reference to a Transaction Party in clause 3.1 of the Common Terms Deed includes a reference to the Additional Guarantor;

• (b) each reference to a Transaction Document includes this deed and each other Transaction Document to which the Additional Guarantor is a party; and

• (c) clauses 3.2 and 3.3 of the Common Terms Deed apply to this clause 5 as if set out in full.

• 6 Status of Additional Guarantor

The Additional Guarantor agrees that it irrevocably becomes an ‘Additional Guarantor’[ and ‘Additional Borrower’] as defined in, and for all purposes under, the Common Terms Deed as if named in and as a party to the Common Terms Deed, and accordingly is bound by the Common Terms Deed as an Additional Guarantor[ and Additional Borrower].

page 2

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<Attachment 1 Accession Deed — Additional Guarantors and Additional Borrowers

• 7 Receipt of documents

• The Additional Guarantor acknowledges having received and reviewed to its satisfaction a copy of each Transaction Document and each other document requested by it before signing this deed poll.

• 8 Confirmation by existing Transaction Parties

• Sims (for itself and as attorney for each other Transaction Party) confirms that nothing in this deed poll:

• (a) affects the validity or enforceability of the Transaction Documents;

• (b) prejudices or adversely affects any right, power, authority, discretion or remedy arising under the Transaction Documents; or

• (c) discharges, releases or otherwise affects any liability or obligation arising under the Transaction Documents.

• 9 Governing law

This deed poll is governed by the laws of New South Wales.

• 10 Benefit of deed poll

• (a) This deed poll is given in favour of and for the benefit of:

• (1) each Lender; and

• (2) each Transaction Party,

under the Common Terms Deed and their respective successors and permitted assigns

• (b) Each Lender has the benefit of this deed poll and can enforce it even if not in existence at the time this deed poll is executed.

• (c) Each Lender may enforce its rights under this deed poll independently from each other Lender.

• 11 Address for notices

The details for the Additional Guarantor for service of notices are:

Address: [ ] .

Attention: [ ] .

page 3

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<Attachment 1 Accession Deed — Additional Guarantors and Additional Borrowers

Facsimile: [ ] .

• 12 Attorneys

Each of the attorneys executing this deed poll states that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

Executed as a deed poll

Additional Guarantor

Signed sealed and delivered for

• [ ]

by its attorney

sign here �

Attorney print name in the presence of sign here � Witness

print name

print name

page 4

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<Attachment 1 Accession Deed — Additional Guarantors and Additional Borrowers

sign here� print name sign here� print name	Sims Signed sealed and delivered forSims Metal Management Limited for itself and as attorney for each other Transaction Party
	Director
	Director/Secretary

page 5

Attachment 2

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Accession Deed — New Lenders

Clauses 1.2 (Definitions) and 14 (New Lenders and Additional Transaction Parties)

►

This deed is made by

Sims Sims Metal Management Limited

ACN 114 838 630 of Sir Joseph Banks Corporate Park, Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

New Lender [ ] [ insert ACN/ABN/ARBN ] of [ ]

• Background 1 Under the Common Terms Deed dated 2 November 2009 ( Common Terms Deed ) between Sims Metal Management Limited ( Sims ), each party listed in Part 1 of Schedule 1 of that deed (as Original Borrowers ), each party listed in Part 2 of Schedule 1 of that deed (as Original Guarantors ) and the person listed in Part 3 of Schedule 1 of that deed (as Original Lender ) a person may become a Lender by execution of this deed.

• 2 The New Lender wishes to become a Lender on the terms and conditions set out in this deed poll.

This deed witnesses as follows:

• 1 Interpretation

Words and phrases defined in the Common Terms Deed have the same meaning when used in this deed.

page 1

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<Attachment 2 Accession Deed — New Lenders

• 2 New Lender

• The New Lender agrees that it irrevocably becomes a ‘New Lender’ as defined in, and for all purposes under, the Common Terms Deed as if named in and as a party to the

• Common Terms Deed, and accordingly is bound by the Common Terms Deed as a New Lender.

• [The Facility Agent (as defined in clause 15.1 of the Common Terms Deed) for the New Lender is [Insert details] .]

• 3 Facility Agreement and Transaction Documents

• For the purposes of the Common Terms Deed:

• (a) the “Facility Agreement” of the New Lender is:

• [Insert details]

• (b) The “Transaction Documents” of the New Lender are:

• (1) each Transaction Document as defined in the Common Terms Deed to which the New Lender is a party; and

• (2) [Insert details] .

• 4 Confirmation by existing Transaction Parties

• Sims (for itself and as attorney for each other Transaction Party) confirms that nothing in this deed:

• (a) affects the validity or enforceability of the Transaction Documents;

• (b) prejudices or adversely affects any right, power, authority, discretion or remedy arising under the Transaction Documents; or

• (c) discharges, releases or otherwise affects any liability or obligation arising under the Transaction Documents.

• 5 Governing law

• This deed poll is governed by the laws of New South Wales.

• 6 Benefit of deed poll

• (a) This deed poll is given in favour of and for the benefit of:

page 2

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<Attachment 2 Accession Deed — New Lenders

• (1) each Lender; and

• (2) each Transaction Party,

• under the Common Terms Deed and their respective successors and permitted assigns

• (b) Each Lender has the benefit of this deed poll and can enforce it even if not in existence at the time this deed poll is executed.

• (c) Each Lender may enforce its rights under this deed poll independently from each other Lender.

• 7 Address for notices

The details for the New Lender for service of notices are:

Address: [ ].

Attention: [ ]. Facsimile: [ ].

• 8 Attorneys

Each of the attorneys executing this deed poll states that the attorney has no notice of the revocation of the power of attorney appointing that attorney.

page 3

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<Attachment 2 Accession Deed — New Lenders

Executed as a deed poll

New Lender

Signed sealed and delivered for [ ] by its attorney

sign here � Attorney print name

in the presence of sign here � Witness print name

Sims

Signed sealed and delivered for Sims Metal Management Limited for itself and as attorney for each other Transaction Party

sign here � Director

print name

sign here � Director/Company Secretary print name

page 4

EX-4.15 c53813exv4w15.htm EX-4.15

Exhibit 4.15

CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO CERTAIN PORTIONS OF THIS AGREEMENT. CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION.

GROUP LIMIT FACILITY

TO: COMMONWEALTH BANK OF AUSTRALIA ABN 48 123 123 124 (“ the Bank ”)

APPLICATION FOR GROUP ACCOMMODATION

Application is hereby made to the Bank by the companies listed in the First Schedule hereto or listed in any schedule signed by or on behalf of the Bank and the company named in the Second Schedule hereto pursuant to clause 2(i) in substitution for the First Schedule hereto (all such companies and each of them separately being referred to herein as “ the Applicant ”) for accommodation from time to time by way of overdraft (referred to herein as “ the Accommodation ”).

In this application:

“ Cap Limit ” means A$249,999,999-00 or such other amount as agreed from time to time by the Bank.

“ Cap Limit Amount ” means the amount (converted into Australian dollars at the Exchange Rate, if necessary) by which the aggregate debit balances of all accounts of the Applicant are drawn.

“ Common Terms Deed ” means the deed so entitled dated on or about the date of this application between, amongst others, the Bank and the Applicant.

“ Exchange Rate ” has the meaning given in the Multi-Option Facility Agreement.

“ Group Limit ” means A$5,000,000-00 or such other amount as agreed from time to time by the Bank .

“ Group Limit Amount ” means the amount (in Australian dollars), if any, by which the aggregate of debit balances of all accounts of all companies comprising the Applicant (converted into Australian dollars at the Exchange Rate, if necessary) exceeds the aggregate of credit balances of the Applicant (converted into Australian dollars at the Exchange Rate, if necessary) .

“ Margin ” means, initially, the rate determined in accordance with the following table:

==> picture [380 x 28] intentionally omitted <==

and thereafter as varied from time to time in accordance with clause 1(d);

Multi-Option Facility Agreement means the facility agreement so entitled dated on or about the date of this application between, amongst others, the Bank and the Applicant.

It is understood that the following conditions shall apply to all Accommodation approved pursuant to this application:-

1. (a) The Accommodation shall be granted on the Bank’s usual terms and conditions, the terms and conditions set out in this application, the Multi-Option Facility Agreement, the Common Terms Deed and such other terms and conditions as the Bank may from time to time impose.

2. (b) (i) The Applicant must ensure that the Group Limit Amount is less than or equal to the Group Limit.

   • (ii) The Applicant must ensure that the Cap Limit Amount is less than or equal to the Cap Limit.

   • (iii) If at any time the Group Limit Amount exceeds the Group Limit or the Cap Limit Amount exceeds the Cap Limit the Applicant must pay to the Bank on demand the amount necessary to reduce the Group Limit Amount or the Cap Limit

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Amount to below or equal to the Group Limit or Cap Limit as applicable.

• (c) (i) The Accommodation shall be secured by such securities as may from time to time be agreed between the Bank and the company named in the Second Schedule hereto, which securities shall be in such form or forms as required by the Bank. Securities presently required are set out in the annexure hereto (being, as at the date of this application, none).

• (ii) The titles to any property over which security is to be granted to the Bank must be to the Bank’s satisfaction and will be investigated by the Bank or its solicitors at the Applicant’s expense. Any expense incurred by the Bank in such investigation will be paid by the Applicant whether or not any Accommodation is granted.

• (iii) The Applicant understands and agrees that any inspection undertaken of any property over which security is to be granted will be conducted for the Bank’s own internal purposes only and not on the Applicant’s behalf and will remain the Bank’s exclusive property. The Applicant also understands and agrees that the Bank will not incur any responsibility whatsoever for or in connection with and makes no representation with respect to the construction of any building on the land or the standard or value thereof by virtue of any such inspection or any subsequent action it may take as a result of such inspection.

• (iv) The Applicant must not, and must procure that no other company comprising the Applicant will, create or allow to exist or agree to any Encumbrance (as defined in the Common Terms Deed) over any account to which this Application for Accommodation applies.

• (d) The Bank may from time to time at its pleasure cancel or vary the Cap Limit or the Group Limit, immediately by notice in writing to the company named in the Second Schedule hereto and may vary the rate of interest applicable to the Accommodation in accordance with the procedure for the review and renewal of its commitment under clause 4.5 of the Multi-Option Facility Agreement.

• (e) The Accommodation is payable on the earlier of:

• (i) the date on which demand for repayment of the Accommodation is made by the Bank;

• (ii) the Termination Date (as defined in the Multi-Option Facility Agreement) (if any) for the Overdraft Facility (as defined in the Multi-Option Facility Agreement); and

• (iii) the Final Termination Date (as defined in the Multi-Option Facility Agreement).

• (f) The Applicant will pay to the Bank, the Bank’s fees and charges (including establishment fees and charges, loan service and account service fees and charges) which the Bank shall charge, pay or incur in any way in connection with the establishment and continuance of the Accommodation (initially as specified in the Third Schedule and thereafter as advised by the Bank from time to time) and any right, power, claim or remedy of any kind in respect of the Accommodation or any security for the Accommodation.

• (g) The Bank may debit any account of the Applicant with all interest in respect of the Accommodation or credit any account of the Applicant with any net credit interest payable by the Bank to the applicant in accordance with clause 1(h)(v) and all costs, charges and expenses as aforesaid.

• (h) Interest accrues and is calculated on the net balance of all accounts of the Applicant to which this Application for Accommodation applies (“the accounts of the applicant”) as follows:-

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  - (i) Interest at the Corporate Overdraft Reference Rate (being the interest rate published under that title from time to time by the Bank in leading daily newspapers in each State for overdraft accommodation or, if there is no such rate at any time, any substitute or replacement reference rate published by the Bank from time to time) plus the Margin, is calculated on any day on which the net balance of the accounts of the applicant is in debit and is calculated on that net debit balance (the “debit interest”). The determination by the Bank of the Corporate Overdraft Reference Rate and the Margin is, in the absence of manifest error, conclusive and binding on the Applicant;

  - (ii) Interest, initially at the rate specified in the Third Schedule and thereafter at the rate agreed by the company named in the Second Schedule and the Bank in writing, is calculated on any day on which the net balance of the accounts of the applicant is in credit and is calculated on that net credit balance (the “credit interest”);

  - (iii)  The amounts of debit interest and credit interest are set off against each other on the monthly interest charging date for the accounts of the applicant to produce a net balance of either debit interest owing by the applicant to the Bank or credit interest payable by the Bank to the applicant;

  - (iv) If as a result of the set-off in accordance with clause 1(h)(iii) a net balance of debit interest is owing by the applicant to the Bank the net debit interest is debited to any account of the applicant in accordance with clause 1(g); and

  - (v) If as a result of the set-off in accordance with clause 1(h)(iii) a net balance of interest is payable by the Bank to the applicant the net credit interest is credited to any account of the applicant in accordance with clause 1(g).

1. (a) The Applicant requests and authorises the Bank to make available all or any part of the Accommodation to any one or more of the companies comprising the Applicant by allowing any one or more of the companies from time to time to draw upon such of their accounts conducted with the Bank as the Bank may approve.

2. (b) The Applicant requests and authorises the Bank to rely on such authorities to operate upon accounts by cheque or any other means given to the Bank by any of the companies comprising the Applicant from time to time to authorise drawings of all or any part of the Accommodation.

3. (c) The Applicant agrees to indemnify the Bank for all liabilities incurred to the Bank by any of the companies comprising the Applicant and each company agrees to be liable jointly with all other companies comprising the Applicant and severally as principal debtor to the Bank for all moneys from time to time owing to the Bank pursuant to the Accommodation whether or not the same exceeds the Cap Limit or Group Limit.

4. (d) The Applicant acknowledges that the Bank may during the continuance of the Accommodation refuse to honour or pay cheques drawn or any other drawings upon any of the companies’ accounts, whether the relevant account is in debit or credit at the time the cheques are presented for payment or the drawings requested to be made, in any case where the Cap Limit, the Group Limit or the Commitment (as defined in the Multi-Option Facility Agreement) would be exceeded if such cheques or other drawings were paid.

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• (e) The Applicant authorises the Bank in its discretion to apply the whole or any part of the balance standing to the credit of any of its accounts with the Bank from time to time towards satisfaction of any moneys owing to the Bank pursuant to the Accommodation on any account of any of the companies comprising the Applicant.

• (f) The Applicant appoints the company named in the Second Schedule to this application to be its agent for the purposes of receiving from and giving to the Bank all advice and notifications relevant to the Accommodation, including notices of non-payment or dishonour of any drawings on the accounts of any companies comprising the Applicant and requests for increases in the Cap Limit or the Group Limit and for the extension of the Accommodation to a further company or companies and any release or exchange or addition to the securities securing the Accommodation from time to time and agreeing the accounts to which this Application applies and the rate of interest on any net credit balance of the accounts of the Applicant in accordance with clause 1(h)(ii).

• (g) The Applicant agrees that the Bank in its discretion from time to time may agree to the Accommodation being extended to such further company or companies as may be nominated by the company named in the Second Schedule provided that such further company or companies is incorporated in Australia, accedes as an “Additional Borrower” (as defined in the Multi-Option Facility Agreement) under and in accordance with the Multi-Option Facility Agreement and agrees in writing to be bound by all terms and conditions applicable to the Accommodation including the terms of this application. The Applicant further agrees with respect to each such extension of the Accommodation that:-

• (i) the liability of the Applicant with respect to the companies comprising the Applicant immediately prior to the extension of Accommodation to any company shall not be affected by such extension; and

• (ii) the terms of this application, including without limitation the indemnity set out in clause 2(c), shall apply to such further company or companies as if they were named in the first Schedule.

• (h) Where the securities securing the Accommodation are varied from the securities set out in the annexure hereto, then the companies comprising the Applicant agree that any release of, exchange or addition to, the securities at any time shall not release or discharge any of the companies comprising the Applicant from full liability in respect of the Accommodation including, without limitation, their liability under clause 2(c).

• (i) Upon any extension of the Accommodation to any further company or companies pursuant to clause 2(g) or any release of, exchange or addition to the securities securing the Accommodation pursuant to clause 2(h) a new Schedule setting out details of all the companies thereafter to comprise the Applicant and/or the securities thereafter securing the Accommodation shall be signed by or on behalf of the Bank and the company named in the Second Schedule hereto and in the event that the new Schedule amends the First Schedule hereto whether by addition or deletion of companies comprising the Applicant such new Schedule will apply in substitution for the First Schedule or in the event that the new Schedule varies the securities required by the Bank to secure the Accommodation such new Schedule will apply in substitution for the annexure referred to in clause 1(c)(i).

• (j) No payment which may be avoided under any law for the time being in force relating to bankruptcy or the winding up or administration of companies and no release settlement or discharge which may have been given or made on the faith of any such payment shall prejudice or affect the right of the Bank to recover under this application from the Applicant and in the event of any such

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payment being so avoided, whether such avoidance is ordered, compromised or conceded, the Bank and the Applicant shall be restored to the rights which each respectively would have had if no such payment had been made and no release settlement or discharge had been given or made on the faith thereof and the Bank may in its discretion decline to give any such release settlement or discharge so long as any payment made in or towards payment of the Accommodation remains liable to be so avoided.

• (k) (i) If:

(a) the commencement or intrdocution of, or any change in, a present or future law, regulation or treaty (which if not having the force of law, would be complied with by a responsible financial institution) or in its interpretation or administration; or

• (b) the commencement or introduction of, or a change in any present or future order, official policy, directive, requirement guideline or request (whether or not having the force of law but if not having the force of law, would be complied with by a responsible financial institution) of or from any government or central bank or governmental, fiscal, monetary, supervisory or other authority provided that any such change does not relate to the effective rate of tax which is imposed on the overall net income of the Bank),

will in the Bank’s determination result in a direct or indirect increase to the Bank of the cost of committing, providing or maintaining any Accommodation granted to the Applicant by the Bank or in a direct or indirect reduction in any amount received or receivable by the Bank or in the effective return to the Bank (including, without limitation, the return on the Bank’s capital) under this application, in each case by an amount which the Bank deems to be material,

then the Applicant must pay to the Bank on demand the additional amounts which the Bank certifies are necessary to compensate it for the increased cost or reduction caused by the change, compliance and/or change in the manner of compliance.

• (ii) Where the increased cost or reduction is indirect, then the Applicant must pay to the Bank the proportion of it which the Bank determines is fairly attributable to the Accommodation granted to the Applicant by the Bank.

• (iii) In determining any amount payable under clause 2(k) (i) or (ii), the Bank may use averaging, attribution and/or any other methods of calculation as it commonly uses and/or any other reasonable methods of calculation as it deems appropriate.

• (iv) The Applicant is not obliged to pay compensation under this clause if the relevant increased cost, reduction in the amount receivable or reduction in return on capital is:

• (a) fully compensated for by clause 9.4 of the Common Terms Deed; or

• (b) attributable to the wilful breach by the Bank of any law or a breach by the Bank of the terms of a Transaction Document (as defined in the Common Terms Deed).

• (iv) In the event of any inconsistency between the provisions of this clause 2(k) and any similar clause in any agreement between any company comprising the Applicant and the Bank relating to the provision of the Accommodation,

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the provisions of this clause 2(k) shall apply to the extent of any inconsistency between this clause 2(k) and any such inconsistent provision.

• (l) The Applicant hereby acknowledges that it has not relied on any representations, predictions or statements of opinion by the Bank or any of its officers or agents as to the tax treatment of any interest debited to or accruing to any account of the Applicant under this Application for Group Accommodation.

• (m) The Applicant acknowledges and agrees that this application is a Transaction Document for the purposes of the Common Terms Deed and the Multi-Option Facility Agreement.

• (n) This application is governed by the laws of New South Wales.

Dated this 2nd day of November, 2009

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First Schedule

SIMS GROUP AUSTRALIA HOLDINGS LIMITED ACN 008 634 526 SIMS ALUMINIUM PTY LIMITED ACN 004 370 905 SIMS METAL MANAGEMENT LTD ACN 114 838 630

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Second Schedule

SIMS GROUP AUSTRALIA HOLDINGS LIMITED ACN 008 634 526

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Third Schedule – Overdraft fees and credit interest

Overdraft Fees and Charges
Overdraft Line Fee	[*]	[*]	p.a. charged
			quarterly
Credit Interest			Terms
Facility Limits
For Balances to $500,000.00			p.a.
• RBA Target Cash Rate (presently:[*]p.a.) less[*]
For Balances to $1,000,000.00			p.a.
• RBA Target Cash Rate (presently:[*]p.a.) less[*]
For Balances to $2,000,000.00			p.a.
• RBA Target Cash Rate (presently:[*]p.a.) less[*]
For Balances over $2,000,000.00			p.a.
• RBA Target Cash Rate (presently:[*]p.a.) less[*]

	Proposed Fee GST	Proposed Fee GST
Cash Pooling Facilities	Exclusive	Inclusive	Terms
Notional Cash Pooling (GLF/NBRS)
Maintenance Fee	[*]	[*]	per month

Proposed Fee GST Proposed Fee GST Account Transactions Exclusive Inclusive Terms	Proposed Fee GST Proposed Fee GST Account Transactions Exclusive Inclusive Terms	Proposed Fee GST Proposed Fee GST Account Transactions Exclusive Inclusive Terms
Transaction Fees
Account Maintenance Fee [*] [*] per A/C per month
Cheques Written / Negotiated [*]	[*]	per item
Over the Counter Deposit [*] [*] per transaction
Cheques in OTC Deposits [*]	[*] per item
Over the Counter Withdrawals / Cash Cheques [*] [*] per transaction
Quick Deposits Box Deposits [*]	[*] per transaction
Cheques in Quick Deposits Box Deposits [*] [*] per item
Electronic Debit — Electronic Withdrawal [*]	[*] per transaction
Electronic Debit — ATM Withdrawal [*] [*]per transaction
Electronic Credit — Electronic Deposit [*]	[*] per transaction

Accounts

Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms	Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms	Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms
Service Fees
Audit Certificate Fee [*] [*] per certificate
Certificate of Balance / Interest [*]	[*] per certificate
Bank Cheque — Issuance Fee [*] [*] per cheque
Bank Cheque — Cancellation Fee [*]	[*]	per cheque
Bank Cheque — Duplicate Issuance fee [*] [*] per cheque
Banker’s Opinion Fee [*]	[*] per item
Note Handling Fee (for OTC Dr/Cr notes over $50,000) [*] [*] per transaction
Coin Handling Fee (for OTC Dr/Cr coins over $1,000) [*]	[*] per transaction

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Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms Dishonour Fee — Outward (cheque) [*] [*] per item	Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms Dishonour Fee — Outward (cheque) [*] [*] per item	Current Fee GST Current Fee GST Ancillary Services Exclusive Inclusive Terms Dishonour Fee — Outward (cheque) [*] [*] per item
Dishonour Fee — Outward (DE) [*]	[*] per item
Duplicate Statement Fee [*] [*] per statement
Encashment Authority Fee [*]	[*] per item
Foreign Currency Draft Fee (from branch) [*] [*]per draft
Inward International Money Transfer (IMT) Cr to Non-CBA A/C Fee [*]	[*] per transaction
Inward International Money Transfer (IMT) Cr to CBA A/C Fee [*] [*] per transaction
Night Safe Wallet (initial) [*]	[*] per item
Night Safe Wallet (additional) [*] [*] per item
Overdrawing Approval Fee [*]	[*] per approval
QuickCash Envelopes — Fee [*] [*] per item
Stopped Cheque Fee [*]	[*]	per cheque
Stopped Cheque Lift Fee [*] [*] per cheque
Special Answer Fee [*]	[*] per item
Transaction Trace — Paper [*] [*] per item
Transaction Trace — Electronic [*]	[*] per item
Transaction Trace — International [*] [*] per item
Voucher Retrieval Fee (per item) [*]	[*] per trace
Voucher Retrieval Fee (min price) [*] [*]per request
Voucher Retrieval Fee (per hour) [*]	[*] per hour

Payments: Electronic Banking

Current Fee GST Current Fee GST CommBiz Exclusive Inclusive Terms	Current Fee GST Current Fee GST CommBiz Exclusive Inclusive Terms	Current Fee GST Current Fee GST CommBiz Exclusive Inclusive Terms	Current Fee GST Current Fee GST CommBiz Exclusive Inclusive Terms
Electronic Banking Channel Fees (CommBiz: )
GST Additional Training / Technical Services (CommBiz) [] []* per hour
GST Provision of Security Token [] []*		per token
GST User Access with Security Token [] []* per user / per month
Electronic Banking Transaction Fees
GST Transaction Activity Fee — Direct Credit [] []* per transaction
GST Transaction Activity Fee — Direct Debit [] []*		per transaction
GST Transaction Activity Fee — BPAY Payment [] []* per transaction
Priority Payment to CommBank A/C [*] [*]		per transaction
Priority Payment to Other Bank A/C [*] [*] per transaction Current Fee GST Current Fee GST Electronic Banking - Ancillary Services Exclusive Inclusive Terms
Ancillary Fees (Diammond / CommBiz)
GST Rejected / Returned Electronic Transactions (non CommBiz) [] []* per transaction
GST Returned Direct Credit / Direct Debit payment (CommBiz only) []**	[*]		per transaction
GST File Recall / Duplicate File Recall (non CommBiz) [] []* per file
GST Direct Credit File Recall (CommBiz only) []**	[*] per file
GST Transaction (Item) Recalls (non CommBiz) [] []* per transaction

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Current Fee GST Current Fee GST Electronic Banking - Ancillary Services Exclusive Inclusive Terms	Current Fee GST Current Fee GST Electronic Banking - Ancillary Services Exclusive Inclusive Terms	Current Fee GST Current Fee GST Electronic Banking - Ancillary Services Exclusive Inclusive Terms
GST Direct Credit Item Recall (CommBiz only) []**	[*] per transaction
GST BPAY Payment Item Recall (CommBiz only) [] []* per transaction
GST Overlimit Processing — Direct Entry Payment (non CommBiz) []**	[*] per referral
GST Declined Transactions / Outward Dishonour (non CommBiz) [] []* per transaction
GST Risk Approval/Declined Direct Credit / Direct Debit payment (CommBiz) []**	[*] per transaction
Risk Approval/Declined Priority/IMT/ Foreign Currency payment (CommBiz) [*] [*] per transaction
GST Transaction Traces (non CommBiz) []**	[*] per trace
GST Trace, Direct Credit / Direct Debit (CommBiz only) [] []* per trace
Trace Priority/IMT/Foreign Currency Payment (CommBiz) [*]	[*] per trace
Amendment to IMT or Foreign Currency Payment (CommBiz only) [*] [*] per amendment
Cancellation of IMT or Foreign Currency Payment (CommBiz only) [*]	[*] per cancellation
Copy of Payment Message (CommBiz only) [*] [*] per copy
Remittance Advice (CommBiz)
GST E-mail [] []* per item
GST Fax — within Australia []**	[*] per item
GST Fax — Overseas [] []* per item
GST Mail — within Australia []**	[*]	per item
GST Mail — Overseas [] []* per item
Secure Request (CommBiz)
Stop Cheque or Lift Stop request [*] [*] per cheque

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Executed as a deed

Signed, sealed and delivered by SIMS GROUP AUSTRALIA HOLDINGS LIMITED ACN 008 634 526

Signed, sealed and delivered by SIMS ALUMINIUM PTY LIMITED ACN 004 370 905

) ) ) Director ) Full ) Name: ) ) Address ) ) ) Company Secretary or Other ) Director ) ) Full ) Name: ) ) Address: ) ) ) Director ) Full ) Name: )[ ) ][Address ] ) ) ) Company Secretary or Other ) Director ) ) Full ) Name: ) ) Address:

[*] Confidential Treatment Requested

Signed, sealed and delivered by SIMS METAL MANAGEMENT LIMITED ACN 114 838 630

==> picture [273 x 205] intentionally omitted <==

----- Start of picture text -----

13
)
)
) Director
) Full
) Name:
)
) Address
)
)
) Company Secretary or Other
) Director
)
) Full
) Name:
)
[ ) ] [Address: ]
----- End of picture text -----

Lender

Signed sealed and delivered for Commonwealth Bank of Australia by its attorney

sign here � Attorney

print name

in the presence of sign here � Witness

print name

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Annexure to Application for Group Accommodation

Dated:

Schedule of Securities

UNSECURED

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EX-4.17 c53813exv4w17.htm EX-4.17

Exhibit 4.17

CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO CERTAIN PORTIONS OF THIS AGREEMENT. CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION.

Institutional Banking Level 3, 275 Kent Street SYDNEY NSW 2000 Phone: (02) 8254 8812 Fax: (02) 8254 8999

November 2, 2009

The Directors Sims Metal Management Limited Sir Joseph Banks Corporate Park Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

Attention: Mr. Peter Ricketts

Variation to Standard Terms

Westpac Banking Corporation ( Westpac ) proposes to further vary the Standard Terms dated 1 November 2000, as amended ( Standard Terms ), to which Sims Metal Management Limited ACN 114 838 630 ( Sims ) and its subsidiaries listed in the attached Subsidiaries Schedule (together the Undertaking Companies ) are parties.

The amendments needed to document the varied Standard Terms are set out below.

Please confirm the Undertaking Companies’ acceptance of these amendments by signing the accompanying copy of this letter and arranging for it to be signed also by the companies listed in the attached Guarantors Schedule (together the Guarantors ) and returning it to us within 30 days of the date of this letter or such later date as Westpac may agree in writing.

Capitalised terms defined in the Standard Terms have the same meanings when used in this letter.

This is a Bank Document for the purposes of the Standard Terms.

Variation to Standard Terms — ©Westpac Banking Corporation

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1. Amendments

Standard Terms

The Standard Terms are amended by replacing the entire Standard Terms with the Standard Terms set out in the Annexure.

2. General

Condition Precedent

Before the amendments referred to above become effective Westpac must confirm in writing that the following conditions precedent have been satisfied:

• the Undertaking Companies and the Guarantors must sign and return a copy of this letter; and

• if incorporated outside of Australia, each Undertaking Company and Guarantor must deliver in form and substance satisfactory to Westpac, a legal opinion regarding execution of this letter.

References to Standard Terms

Any reference in the multicurrency revolving floating rate cash advance facility agreement dated 1 November 2000, as amended, between Sims, the Undertaking Companies and Westpac ( Agreement ) to the Standard Terms includes a reference to the Standard Terms as amended by this letter or as further varied from time to time.

Confirmation by Guarantors

Each Guarantor confirms that:

• It agrees to the amendment to the Standard Terms referred to in this letter;

• This amendment does not in any way release, reduce or limit its liability and obligations to Westpac under the Group Guarantee dated 15 November 2000 between (amongst others) it and Westpac (the Group Guarantee );

• The Group Guarantee remains a valid obligation binding on it to pay amongst other things and according to its terms, all moneys due and payable from time to time to Westpac under the Agreement and Standard Terms as varied from time to time; and

• This confirmation is binding on it irrespective of whether all Guarantors sign or whether the statements are true in respect of each other Guarantor.

Variation to Standard Terms — ©Westpac Banking Corporation

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Governing law and Jurisdiction

This letter is governed by New South Wales law. The Undertaking Companies and Guarantors accept the non-exclusive jurisdiction of the courts having jurisdiction there.

Subsidiaries’ Schedule

Name of Company	ACN/ARB/ place of incorporation
Sims Group Australia Holdings Limited	008 634 526
Sims Group UK Limited	UK 3242331
Sims Group UK Holdings Limited	UK 2904307
Mirec BV	Holland 17073024
Sims Recycling Solutions AB	Sweden
Sims Group USA Corporation	Delaware
Sims Group Global Trade Corporation	Delaware
North Carolina Resource Conservation LLC	North Carolina
Sims Group USA Holdings Corporation	Delaware
Schiabo Larovo Corporation	Delaware
Simsmetal East LLC	Delaware
Simsmetal West LLC	Delaware
Metal Management, Inc.	Delaware
Metal Management Alabama, Inc.	Delaware
Metal Management Arizona, L.L.C.	Arizona
Metal Management Connecticut, Inc.	Delaware
Metal Management Memphis, L.L.C.	Tennessee
Metal Management Midwest, Inc.	Illinois
Metal Management Mississippi, Inc.	Delaware
Metal Management Northeast, Inc.	New Jersey
Metal Management Ohio, Inc.	Ohio
Metal Management West, Inc.	Colorado
Proler Southwest LP	Texas
Metal Dynamics Detroit LLC	Delaware
Variation to Standard Terms — ©Westpac Banking Corporation		Page 3
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Guarantors Schedule

Name of Company Sims Group Australia Holdings Limited Sims Metal Management Limited Simsmetal Holdings Pty Limited Simsmetal Services Pty Limited Sims Manufacturing Pty Limited Sims Industrial Pty Limited Sims Energy Pty Limited Sims Group UK Limited Sims Group UK Holdings Limited Mirec BV Sims Recycling Solutions AB Simsmetal Industries Limited Sims M+R GmbH Sims Group German Holdings GmbH Sims Metal Management Asia Limited (previously known as Sims Asia Holdings Limited) Sims Group Recycling Solutions Canada Ltd Sims Group Canada Holdings Limited Sims Group USA Corporation Sims Group Global Trade Corporation North Carolina Resource Conservation, LLC Sims Group USA Holdings Corporation SHN Co., LLC HNE Recycling LLC HNW Recycling LLC Schiabo Larovo Corporation Simsmetal East LLC Simsmetal West LLC Variation to Standard Terms — ©Westpac Banking Corporation

ACN/ARBN

008 634 526 114 838 630 000 021 563 000 166 987 004 332 870 000 090 479 009 667 752 UK 3242331 UK 2904307 Holland 17073024 Sweden New Zealand Germany Germany Hong Kong Canada Canada Delaware Delaware North Carolina Delaware Delaware Delaware Delaware Delaware Delaware Delaware Page 4

[*] Confidential Treatment Requested

Name of Company

Name of Company Sims Recycling Solutions Holdings, Inc. (formerly Sims Recycling Solutions, Inc.) Sims Recycling Solutions, Inc. (formerly United Refining & Smelting Co.) Metal Management, Inc. CIM Trucking, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Metal Management Midwest, Inc. Metal Management Mississippi, Inc. Metal Management New Haven, Inc. Metal Management Northeast, Inc. Metal Management Ohio, Inc. Metal Management Pittsburgh, Inc. Metal Management Proler Southwest, Inc. Sims — North America Trade Corporation Metal Management West Coast Holdings, Inc. Metal Management West, Inc. MM Metal Dynamics Holdings, Inc. Naporano Iron & Metal, Inc. New York Recycling Ventures, Inc. Proler Southwest GP, Inc. Proler Southwest LP Reserve Iron & Metal Limited Partnership Metal Dynamics LLC Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC	ACN/ARBN
	Illinois Illinois Delaware Illinois Delaware Arizona Delaware Illinois Tennessee Illinois Delaware Delaware New Jersey Ohio Delaware Delaware Delaware Delaware Colorado Delaware Delaware Delaware Delaware Texas Delaware Delaware Delaware Delaware

Sims Municipal Recycling of New York LLC

Delaware

Page 5

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

Signed for and on behalf of Westpac Banking Corporation by its duly Authorised Officer in the presence of: Signature of witness Signature of Authorised Officer Name of witness (please print) Name of Authorised Officer (please print) Office Held Office Held ADDRESS: Level 3, 275 Kent Street, Sydney, NSW 2000 FACSIMILE: (02) 8254 6935

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

Page 6

Accepted for Sims Metal Management Limited by two directors:

Signature of director Signature of director Name of director (please print) Name of director (please print) ADDRESS: Sir Joseph Banks Corporate Park Suite 3, Level 2 32-34 Lord Street Botany NSW 2019 FACSIMILE: (02) 9954 9680

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

Page 7

Executed by Schiabo Larovo Corporation by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

Page 8

[*] Confidential Treatment Requested

Executed by Simsmetal East LLC by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

Page 9

[*] Confidential Treatment Requested

Executed by Simsmetal West LLC by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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[*] Confidential Treatment Requested

Executed by Metal Management, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Metal Management Alabama, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by

Metal Management Arizona, L.L.C. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Connecticut, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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[*] Confidential Treatment Requested

Executed by

Metal Management Memphis, L.L.C. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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[*] Confidential Treatment Requested

Executed by Metal Management Midwest, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Metal Management Mississippi, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Northeast, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Ohio, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Page 19

Executed by Metal Management West, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Page 20

Executed by Proler Southwest LP by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Dynamics Detroit LLC by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Simsmetal Industries Limited by its officer:

Signature of director	Signature of director
Name of director (please print)	Name of director (please print)
Variation to Standard Terms —©Westpac Banking Corporation		Page 23

[*] Confidential Treatment Requested

Executedby
Sims M+R GmbH
by its officer:
Signature of officer	Signature of officer
Name of officer (please print)	Name of officer (please print)
Variation to Standard Terms —©Westpac Banking Corporation		Page 24

[*] Confidential Treatment Requested

Executedby
Sims Group German Holdings GmbH
by its officer:
Signature of officer	Signature of officer
Name of officer (please print)	Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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The Common Seal of Sims Metal Management Asia Limited (previously known as Sims Asia Holdings Limited)

was affixed to this deed in the presence of:

Signature of director Name of director (please print)

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Sims Group Recycling Solutions Canada Ltd by its officer: Signature of officer Name of officer (please print) Title (please print)

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Sims Group Canada Holdings Limited by its officer: Signature of officer Name of officer (please print) Title (please print)

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Sims Recycling Solutions, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Sims Group Recycling Solutions Holdings Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by CIM Trucking, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Indiana, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management New Haven, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Pittsburgh, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Metal Management Proler Southwest, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by Sims – North America Trade Corporation by its officer:

Signature of officer

Name of officer (please print)

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Executed by Metal Management West Coast Holdings, Inc. by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by MM Metal Dynamics Holdings, Inc. by its officer:

Signature of officer

Name of officer (please print)

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Executed by Naporano Iron & Metal, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

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Executed by New York Recycling Ventures, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Proler Southwest GP, Inc. by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Reserve Iron & Metal Limited Partnership by its officer:

Signature of officer Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Metal Dynamics LLC by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Metal Dynamics Indianapolis LLC by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by

Sims Municipal Recycling of New York LLC by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Signed by

Sims Group Australia Holdings Limited by a director and secretary/director: Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation

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Signed by

Simsmetal Holdings Pty Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation

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Signed by

Simsmetal Services Pty Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Signed by

Sims Manufacturing Pty Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Signed by Sims Industrial Pty Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Signed by

Sims Energy Pty Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

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Signed by Sims Group UK Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation

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Signed by

Sims Group UK Holdings Limited by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation

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Signed by Mirec BV by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation

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Signed by

Sims Recycling Solutions AB by a director and secretary/director:

Signature of director Name of director (please print)	Signature of director/secretary � Name of director/secretary �

Variation to Standard Terms — ©Westpac Banking Corporation [*] Confidential Treatment Requested

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Executed by Sims Group USA Corporation by its officer:

Signature of officer

Name of officer (please print)

Variation to Standard Terms — ©Westpac Banking Corporation

[*] Confidential Treatment Requested

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Executed by Sims Group Global Trade Corporation by its officer:

Signature of officer Name of officer (please print)

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Executed by North Carolina Resource Conservation, LLC by its officer:

Signature of officer

Name of officer (please print)

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Executed by Sims Group USA Holdings Corporation by its officer:

Signature of officer Name of officer (please print)

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Executed by SHN Co., LLC by its officer:

Signature of officer

Name of officer (please print)

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Executed by HNE Recycling LLC by its officer: Signature of officer

Name of officer (please print)

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Executed by HNW Recycling LLC by its officer: Signature of officer

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Annexure

Amended Standard Terms

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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO CERTAIN PORTIONS OF THIS AGREEMENT. CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION.

Institutional Banking Level 3, 275 Kent Street SYDNEYNSW2000

Phone: (02) 8254 8812 Fax: (02) 8254 8999

November 2, 2009

The Directors Sims Metal Management Limited Sir Joseph Banks Corporate Park Suite 3, Level 2 32-34 Lord Street Botany NSW 2019

Attention: Mr. Peter Ricketts

Dear Sirs,

STANDARD TERMS

Sims Metal Management Limited (ACN 114 838 630) ( Sims ) and any of its subsidiaries listed in the attached Subsidiaries Schedule (each an Undertaking Subsidiary ) have asked Westpac Banking Corporation ( Westpac ) to give credit, or to continue to provide it, to anyone or more of them.

In exchange for Westpac doing all or any of those things, each of Sims and each Undertaking Subsidiary (each an Undertaking Company ) agrees to the following terms.

1 DEFINITIONS

1.1 Definitions

In this agreement the following definitions apply.

Accounts means the consolidated audited annual accounts and cash flow statements of Sims.

Accounting Standards has the meaning given in clause 1.2(a).

ACDC means Australian Commercial Disputes Centre Limited.

ACDC Guidelines for Expert Determination means the ACDC Guidelines for Expert Determination (or, if the ACDC ceases to exist, the guidelines for expert determination of any similar organisation nominated by the Law Society of NSW) in force from time to time.

Agreement includes any document or instrument of any kind, any deed, agreement or arrangement.

Authorisation includes any consent, registration, filing, lodgment, agreement, certificate, notarisation, permission, licence, approval, authority or exemption, from by or with any

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Governmental Agency. Where a Governmental Agency can prohibit or restrict something if it acts within a specified period after formal notification of it (for example lodgment, registration or filing), Authorisation includes the expiry of that period without that action.

Bank Document means any present or future document, agreement or arrangement (whether or not in writing):

• (a) to which any Undertaking Company is or becomes a party with Westpac; or

• (b) under which obligations arise from any Undertaking Company to Westpac,

in each case, whether or not other parties are involved and whether or not it arises as a result of an assignment or transfer.

Business Day means a day on which banks are open for business in Sydney and Melbourne, not being a Saturday, Sunday or public holiday.

Calculation Date means 30 June and 31 December in each year.

Calculation Period means each period of 12 months ending on a Calculation Date.

Change in Law has the meaning given in clause 10.

Contingent Liability means uncalled capital held by any member of the Sims Group in any corporation other than another member of the Sims Group and any other contingent liability under a Guarantee given by any member of the Sims Group to any person.

Corporations Act means the Corporations Act 2001 (Cth).

Deed of Cross Guarantee means any deed entered into in connection with the granting by the Australian Securities & Investments Commission of an order pursuant to Part 2M.6 of the Corporations Act.

Dispute has the meaning given in clause 15.3(d).

EBITDA means for a relevant period and in respect of the Sims Group, the profit on ordinary activities before:

• (a) taxation;

• (b) Net Interest Expense; and

• (c) amortisation of intangible assets and depreciation of tangible assets of the Sims Group,

as shown on a consolidated basis and as disclosed in the Sims Group’s most recent audited consolidated annual financial reports or semiannual audited or unaudited consolidated financial reports, as applicable.

For the purposes of calculating EBITDA, the calculation will exclude:

• (d) any significant non-cash items or items disclosed as required by AASB 101.97 and AASB 101.98 due to their size or nature or by the corresponding provisions of future revisions of this accounting standard, that are of a non-recurring nature including but not limited to:

• (i) losses or gains on the sale or revaluation of assets,

• (ii) costs relating to restructuring and redundancy,

• (iii) discontinued operations,

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• (iv) discounts on acquisition and gains on formation of joint ventures,

• (v) post acquisition adjustments to contingent liabilities recorded on the date of a business acquisition pursuant to purchase accounting rule changes to be introduced on 1 July 2009, and

• (vi) costs associated with becoming Sarbanes-Oxley Act compliant (as required following the Sims Group’s registration as an issuer in the United States of America);

• (e) significant unrealized gains or losses;

• (f) any other significant non-cash items or items including but not limited to:

• (i) write downs of inventory to net realisable value;

• (ii) revaluation increments to the inventory; and

• (iii) forgone profit arising from sales contract negotiations; and

• (g) any impairment charge or loss (or gain or reversal) relating to the recoverable amount of assets (including any impairment charge relating to goodwill or identified intangible assets),

that are of a non-recurring nature.

The foregoing adjustments to EBITDA in paragraphs (d) to (f) for each Calculation Period will be agreed by Westpac and Sims in writing prior to the end of that Calculation Period, subject to the operation of clause 15.3.

Except for the purpose of calculating the ratio of Net Interest Expense to EBITDA, EBITDA as calculated on any Calculation Date will be adjusted to take into account the effects of any acquisitions or disposals of any company or business made during the Calculation Period ending on that Calculation Date. The adjustments will be made on the basis of the historical EBITDA of the company or business acquired or disposed of in the Calculation Period and ending on that Calculation Date by reference to historical EBITDA for the twelve months immediately preceding the Calculation Date and by reference to:

• (a) in the case of a disposal, the period of time during which the applicable company or business was part of the Sims Group; or

• (b) in the case of an acquisition, for that period being the twelve months immediately preceding the Calculation Date.

Environmental Law means any legislation regulating Pollutants in connection with the protection of the environment or health and safety.

ERISA means the United States Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations thereunder.

ERISA Affiliate means all members of a controlled group of corporations and all trades and businesses (whether or not incorporated) under common control and all other entities which, together with an Undertaking Company and any Subsidiary are treated as a single employer under any or all of Sections 414(b), (c), (m) or (o) of the United States Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations thereunder.

Event of Default has the meaning given in clause 6 below.

Excluded Member is Sims Rush Pty Limited.

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Finance Debt means any debt or other monetary liability in respect of moneys borrowed or raised or any financial accommodation including under or in respect of any:

• (a) bill of exchange as defined in the Bills of Exchange Act 1909 (Cth), bond, debenture, note or similar instrument;

• (b) acceptance, endorsement or discounting arrangement;

• (c) Guarantee;

• (d) finance or capital lease;

• (e) agreement for the deferral for more than 90 days of a purchase price or other payment in relation to the acquisition of any asset or service;

• (f) obligation to deliver goods or provide services paid for in advance by any financier;

• (g) agreement for the payment of capital or premium on the redemption of any preference shares;

• (h) interest or currency swap or hedge arrangement, financial option, futures contract or analogous transaction (the amount of such Finance Debt being the marked to market value of the relevant transaction); or

• (i) counter indemnity obligation in respect of a guarantee, bond, standby or documentary letter of credit or any other instrument issued by a bank or financial institution,

and irrespective of whether the debt or liability:

• (j) is present or future;

• (k) is actual, prospective, contingent or otherwise;

• (l) is at any time ascertained or unascertained;

• (m) is owed or incurred alone or severally or jointly or both with any other person; or

• (n) comprises any combination of the above.

• German Guarantor means a Guarantor which is incorporated in, resident in or whose principal area of business is in Germany

Governmental Agency includes any government, or any government, semi-government or judicial agency or authority.

Group Guarantee has the meaning given in clause 4(i).

GST means the goods and services tax levied under the GST law.

GST law means the A New Tax System (Goods and Services Tax) Act 1999 (Cth).

Guarantee means any guarantee, indemnity, letter of comfort or other assurance against loss. It includes any obligation to be responsible for the solvency or financial condition of another party, or for payment of a debt or obligation of another party, either directly or indirectly (for example, by acquiring the debt or obligation).

Guaranteed Share means any share or stock issued by a member of the Sims Group where redemption of such share or stock or the payment of capital or dividends on such share or stock is the subject of a Guarantee of a member of the Sims Group or a Guarantee of another person who will have recourse in respect of its liability under that Guarantee directly or indirectly to a member of the Sims Group or its assets (other than as a shareholder).

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Guarantor means any party which gives any Guarantee or Security Interest in relation to the obligations of or guaranteed by any Undertaking Company to Westpac now or in the future.

Hazardous Materials shall mean any flammable materials, explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or similar materials defined as such in any law concerning any Hazardous Material, or environmental protection or health and safety.

Hedging Agreement means each interest rate, foreign exchange transaction, equity or equity index option, bond option, commodity swap, commodity option, cap transaction, currency swap transaction, cross-currency swap rate transaction or any other hedge or derivative agreement entered into by an Undertaking Company, including any master agreement and any transaction or confirmation under it.

An entity is Insolvent if:

• (a) it is (or states that it is) an insolvent under administration or insolvent (each as defined in the Corporations Act); or

• (b) it is in liquidation, in provisional liquidation, under administration or wound up or has had a controller appointed to its property; or

• (c) it is subject to any arrangement, assignment, moratorium or composition, protected from creditors under any statute or dissolved (in each case, other than to carry out a reconstruction or amalgamation while solvent which does not have, or is not likely to have, a Material Adverse Effect); or

• (d) an application or order has been made (and, in the case of an application, it is not stayed, withdrawn or dismissed within 14 days), resolution passed, proposal put forward, or any other action taken, in each case in connection with that person, which is preparatory to or could result in any of (a), (b) or (c) above; or

• (e) it is taken (under section 459F(1) of the Corporations Act) to have failed to comply with a statutory demand; or

• (f) it is the subject of an event described in section 459C(2)(b) or section 585 of the Corporations Act (or it makes a statement from which Westpac reasonably deduces it is so subject); or

• (g) it is otherwise unable to pay its debts when they fall due; or

• (h) something having a substantially similar effect to (a) to (g) happens in connection with that entity under the law of any jurisdiction.

Intangible Assets include all goodwill, copyright, patents, trade marks and licences, research and development, future income tax benefit, underwriting and formation expenses and other items of a like nature which according to current accounting practices are regarded as unidentifiable and intangible assets.

Issue means any dispute (other than a dispute that is frivolous or vexatious) between Sims and Westpac as to the calculation of the adjustments to be made in accordance with paragraphs (d) to (g) of the definition of EBITDA in this clause 1.1.

Latest Audited Consolidated Balance Sheet means the most recently prepared audited consolidated balance sheet of the Sims Group, or if a half yearly unaudited balance sheet has been prepared more recently, the half yearly balance sheet, as at or prior to the date at which an examination is being made to determine Total Indebtedness, Total Tangible Assets, current assets, current liabilities or Shareholders Funds.

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Letter of Offer means the multicurrency revolving floating rate cash advance facility agreement dated 1 November 2000 between Sims, Westpac and others, as amended.

Listing Review Period has the meaning given in clause 8(b).

Material Adverse Effect means a material adverse effect on:

• (a) the financial condition of the Undertaking Companies (taken as a whole);

• (b) any Undertaking Company’s ability to perform any of its obligations under any Bank Document;

• (c) the validity or enforceability of the whole or any material part of a Bank Document or any material rights or remedies of Westpac under the Bank Documents; or

• (d) any encumbrance provided to Westpac by an Undertaking Company.

Net Interest Expense means for any period, the aggregate (without double counting) of all interest paid or accrued during that period in respect of any Finance Debt of the Sims Group (including any fees and charges with respect to any guarantee, indemnity or letter of credit or under any bill of exchange, promissory note or any other acceptance or discounting arrangement and any finance charges paid or payable under any hire purchase agreement or lease agreement for which a member of the Sims Group is actually or contingently liable) less any interest income of the Sims Group during that period.

Notification has the meaning given in clause 15.3(b).

Other Documents means those agreements, in the substantially same form as these Standard Terms, or in substantially the same form as these Standard Terms together with any letter of offer in substantially the same form as the Letter of Offer into which any Relevant Company has entered as borrower, or will enter as borrower, with any other party.

Permitted Financial Accommodation means any financial accommodation provided by an Undertaking Company:

• (a) under the Bank Documents;

• (b) to another Undertaking Company;

• (c) in the form of deposits held with financial institutions in the ordinary course of business and supplier advances for which security adequate to cover the amount of the supplier advance is taken; or

• (d) to parties other than Undertaking Companies which when added to all such other outstanding accommodation provided by all Relevant Companies does not exceed A$35,000,000.

Permitted Security Interest means:

• (a) a lien or statutory charge which arises by operation of law in the ordinary course of day to day business and does not secure Finance Debt, but only so long as it pays the amount secured promptly, except where that amount is being contested in good faith; and

• (b) Security Interests that secure Secured Indebtedness not exceeding 5% of Total Tangible Assets.

Pollutant means a pollutant, contaminant, dangerous, toxic or hazardous substance, petroleum or petroleum product, chemical, solid, special liquid, industrial or other waste.

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Relevant Company means Sims, any Guarantor or any subsidiary of any of them.

Secured Indebtedness means at any time the aggregate amount of all secured liabilities of the Sims Group other than the Excluded Member.

Security Interest includes any mortgage, pledge, lien, charge or other security or any arrangement which gives a creditor a preferential right to an asset or its proceeds.

Shareholders’ Funds means Total Tangible Assets less Total Indebtedness.

Sims Group means Sims and its Subsidiaries.

Subsidiary has the meaning given in the Corporations Act.

Tangible Assets means all assets other than Intangible Assets.

Tax means:

• (a) any tax including the GST, levy, charge, impost, duty, fee, deduction, compulsory loan or withholding; or

• (b) any income, stamp or transaction duty, tax or charge,

which is assessed, levied, imposed or collected by any Governmental Agency and includes any interest, fine, penalty, charge, fee or other amount imposed on or in respect of any of the above.

Tax Credit has the meaning given in clause 13.4.

TNW means Shareholders’ Funds less Intangible Assets

Total Indebtedness means at any time the aggregate amount (as disclosed by the Latest Audited Consolidated Balance Sheet) of all secured and unsecured liabilities of the Sims Group together with, unless already included in the Latest Audited Consolidated Balance Sheet:

• (a) the aggregate amount (as disclosed by its latest audited balance sheet) of all secured and unsecured liabilities of any entity which has become a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet and all other amounts which would be included in this definition if references to the Latest Audited Consolidated Balance Sheet were to be to the latest audited balance sheet of that entity;

• (b) the unrepaid principal (or its equivalent) of any Finance Debt where the proceeds or benefits of that Finance Debt:

• (i) have been received by any member of the Sims Group, since the date of the Latest Audited Consolidated Balance Sheet, excluding the amount of any such proceeds which have been applied in reduction of any secured or unsecured liabilities included in this definition; or

• (ii) are to be received by any member of the Sims Group and the receipt of such proceeds or benefits has been underwritten or otherwise assured to the satisfaction of the auditor of the Sims Group;

• (c) the paid up capital amount and accrued but unpaid dividends of Guaranteed Shares;

and after:

• (d) deducting:

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• (i) the aggregate amount of all secured and unsecured liabilities of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet and in respect of which no other member of the Sims Group has any liability; and

• (ii) the aggregate amount of all liabilities which in the opinion of the auditor of the Sims Group have been defeased in such a way as to enable any such liability to be considered as having been extinguished within the meaning of paragraph 30 of Australian Accounting Standard AAS23; and

• (iii) debt reductions of the type referred to in (b)(iii) of the definition of “Total Tangible Assets”;

• (e) eliminating all inter-entity balances among the member of the Sims Groups or any of them (including any member of the Sims Group which has become one since the date of the Latest Audited Consolidated Balance Sheet); and

• (f) making such further adjustments (including, without limitation, elimination of any double counting arising in relation to any Guarantee and the obligation or indebtedness that is the subject of the Guarantee) which in the opinion of the auditor of the Sims Group are appropriate to make a proper determination of the total amount of the aggregate indebtedness of the members of the Sims Group.

In this definition references to “secured and unsecured liabilities” shall include (without limiting the generality of the expression) all Finance Debt and provisions for estimated liabilities for income taxes, long service leave and dividends recommended, declared or accrued but unpaid and provisions for any Contingent Liability but shall not include paid up share capital (other than Guaranteed Shares), reserves of any nature or undistributed profits;

Total Tangible Assets means at any time the aggregate of the book values, as disclosed by the Latest Audited Consolidated Balance Sheet, of all Tangible Assets of the Sims Group and of such Intangible Assets of the Sims Group as Westpac in its sole and absolute discretion may from time to time agree, together with, (unless already included in the Latest Audited Consolidated Balance Sheet):

• (a) the aggregate (as disclosed by its latest audited balance sheet) of the book value of the Tangible Assets as determined by the auditor of the Sims Group (after making provisions for depreciation and bad and doubtful debts and any income yet to mature) of any entity which has become a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet;

• (b) the aggregate proceeds of:

• (i) any issue of shares or stock (including premium) of any member of the Sims Group received since the balance date of the latest Audited Consolidated Balance Sheet; and

• (ii) the aggregate proceeds of any calls on partly paid shares made by any member of the Sims Group which have been received since the balance date of the Latest Audited Consolidated Balance Sheet,

excluding the amount of any such proceeds which:

• (iii) have been applied in reduction of any secured or unsecured liabilities included in the definition of “Total Indebtedness”; or

• (iv) have been applied in acquiring any assets included in Total Tangible Assets under this definition;

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• (c) the book value of any Tangible Assets (not excluded as provided below) acquired since the date of the Latest Audited Consolidated Balance Sheet by any member of the Sims Group with the proceeds of the sale of shares or units in any entity which has ceased to be a member of the Sims Group since that date;

• (d) the book value of all assets which are or may be leased, chartered, hired, managed, used or operated under a finance lease (where the capitalised rent has been included in Total Indebtedness) as determined by the auditor of the Sims Group at least annually or (at the option of Sims) the value as at the date of calculation as assessed by a qualified independent valuer chosen by Sims and approved by Westpac);

• (e) the proceeds of any Finance Debt referred to in paragraph (b) of the definition of “Total Indebtedness” excluding the amount of any proceeds which:

• (i) have been applied in reduction of any other secured or unsecured liabilities included in that definition; or

• (ii) have been applied in acquiring any assets included in Total Tangible Assets under this definition;

• (f) (if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent valuer approved by Westpac), the excess (if any) of the fair value of that Tangible Asset as established by the valuer over its book value (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of that entity) and as accepted by the auditor of the Sims Group without qualification;

and after deducting:

• (g) the amount of any income yet to mature and the amount of provisions for depreciation and for bad and doubtful debts as disclosed by the Latest Audited Consolidated Balance Sheet;

• (h) the aggregate (as disclosed by the latest audited balance sheet of the relevant entity) of the book values of the Tangible Assets of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet, other than Tangible Assets of that entity which have become assets of another member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph (f), the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value);

• (i) the book value of any Tangible Assets of any member of the Sims Group which have been applied since the date of the Latest Audited Consolidated Balance Sheet in the acquisition of any entity which has become a member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph (f), the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value); and

• (j) if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent valuer (whether at the request of Westpac or otherwise), the excess (if any) of the book value of that Tangible Asset (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of that entity) over its fair value as established by the valuer and as accepted by the auditor of the Sims Group without qualification;

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and after:

• (k) eliminating all inter-entity balances among any of the Sims Group (including any member of the Sims Group which has become such since the Latest Audited Consolidated Balance Sheet); and

• (l) making such further adjustments as may properly be necessary to avoid any double counting of assets or as may be required by the auditor of the Sims Group to enable a proper determination to be made of the total amount of the Total Tangible Assets.

• 1.2 Accounting Standards

• (a) Any accounting practice or concept relevant to this agreement is to be construed or determined in accordance with generally accepted accounting standards in Australia ( Accounting Standards ).

• (b) Westpac and each Undertaking Company acknowledges that changes in the Accounting Standards after the date of this agreement may make the operation of the financial undertakings set out in clause 5, a defined term or another clause in a Bank Document that refers to the Accounting Standards or any accounting practice or concept, inappropriate.

• (c) If Sims or Westpac considers that such a change has occurred and notifies Westpac or Sims (as applicable) to that effect (the date such notice is given, the Notification Date ), Sims and Westpac agree to negotiate in good faith to agree to appropriate amendments to the affected clause or definition.

• (d) If Sims and Westpac fail to agree on amendments to the affected clause or definition within 20 Business Days (or such other period as may be agreed between Sims and Westpac) of the Notification Date, then any references to the Accounting Standards in any Bank Document will be deemed to be a reference to the Accounting Standards as at the date of this agreement.

• (e) Unless and until an agreement is reached as contemplated in this clause, the Undertaking Companies will provide each financial report and compliance certificate under clause 4(a)(ii) together with, in each case, any reconciliation statements (audited, where applicable) necessary to enable calculation of the financial undertakings and associated definitions based on the Accounting Standards prior to the relevant change occurring and those changes will be ignored for the purposes of the financial undertakings and the relevant definitions

2 REPRESENTATIONS AND WARRANTIES

Each Undertaking Company represents and warrants as follows.

• (a) (Status) Each Relevant Company is incorporated in the place stated by it. Any Bank Document to which a Relevant Company is expressed to be a party is its binding obligation enforceable against it, and does not breach any document or agreement binding on it or any law.

• (b) ( Corporate power ) It has the corporate power to own its assets and to carry on its business as it is now being conducted.

• (c) (Authority) It has power and authority to enter into and perform its obligations under the Bank Documents to which it is expressed to be a party. No further corporate action is necessary for it to draw under each facility provided under a Bank Document. Each person held out in a verification certificate attached to a Bank Document or other

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• document signed by a secretary or director as having that authority, is authorised to sign a draw down or other notice on its behalf.

• (d) ( Transaction permitted ) The execution, delivery and performance by it of the Bank Documents to which it is expressed to be a party will not breach, or result in a contravention of:

• (i) any law, regulation or authorisation;

• (ii) its constitution or other constituent documents;

• (iii) any limitation on its powers or the powers of its directors; or

• (iv) any encumbrance or agreement which is binding on it or any of its subsidiaries,

• (v) and will not result in:

  • (A) the creation or imposition of any encumbrance on any assets of it or any of its subsidiaries other than as permitted under a Bank Document; or

  • (B) the acceleration of the date for payment of any obligation under any agreement which is binding on it.

• (e) ( Authorisations ) All Authorisations required:

• (i) to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Bank Documents to which it is a party;

• (ii) to make the Bank Documents to which it is a party admissible in evidence in its jurisdiction of incorporation or organisation; and

• (iii) for each Undertaking Company to carry on its business, which are material and where failure to obtain or effect any such Authorisation would have a Material Adverse Effect,

have been obtained or effected and are in full force and effect.

• (f) (Accounts) Its most recent consolidated and unconsolidated accounts give a true and fair view under generally accepted accounting principles. There has been no material adverse change since the period they cover. They disclose all material Finance Debt and material contingent liabilities.

• (g) ( No filing or stamp taxes ) Under the law of any relevant jurisdiction it is not necessary that the Bank Documents be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp duty, registration or other similar Tax be paid on or in relation to the Bank Documents or the transactions contemplated by those Bank Documents.

• (h) ( Default under law ) No Relevant Company is in breach of a law or obligation affecting any of it or its assets in a way which has had, or is likely to have, a Material Adverse Effect.

• (i) (Litigation) No litigation, Tax claim, dispute or other proceeding is current or, to a Relevant Company’s knowledge, the Relevant Company is not threatened with a reasonable likelihood of an adverse decision in excess of A$10,000,000 or which is likely to have a Material Adverse Effect.

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• (j) ( Representations true ) Each of its representations and warranties contained in the Bank Documents is correct and not misleading when made or repeated.

• (k) ( Most favoured nation ) In the reasonable opinion of Sims, the terms of each of the Bank Documents (other than those terms related to pricing (including fees and margins, facility limits, repayment dates and in the case of hedging pricing and individual transaction amounts) are no less favourable in any material respect than the terms in any other facility agreements to which a Relevant Company is a party.

• (l) (No default) There is no subsisting Event of Default, or event which with time or notice or both would become an Event of Default (including any breach of a Bank Document).

• (m) ( Environment Law ):

• (i) There is and has been nothing relating to it or its business or assets which under any law relating to the environment, Hazardous Materials, planning or health and safety has given rise or may give rise to substantial expenditure by it, a substantial claim against it or a requirement that it cease or substantially alter a material activity and

• (ii) other than those Authorisations which a failure to obtain or maintain is not likely to have a Material Adverse Effect, each Undertaking Company has obtained all Authorisations it is required to obtain under any Environmental Laws and such Authorisations are in full force and effect.

• (n) ( Taxation ) To the best of each Undertaking Company’s knowledge, information and belief, having made due enquiries, it has complied with all material laws relating to Tax in all jurisdictions in which it is subject to Tax and has paid all Taxes due and payable by it (other than those Taxes which it is contesting in good faith and in respect of which it has made adequate reserves as long as failure to pay those Taxes would not have, and is not reasonably likely to have, a Material Adverse Effect).

• (o) ( Pari passu ) Each Undertaking Company’s payment obligations under the Bank Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.

• (p) ( No immunity ) No Relevant Company has immunity from the jurisdiction of a court or from legal process.

• (q) ( Governing law and enforcement ) Subject to any qualification in any legal opinion provided to Westpac pursuant to the Bank Documents relating to it or the laws of its jurisdiction:

• (i) the choice of law referred to in this agreement as the governing law of the Bank Documents will be recognised and enforced in its jurisdiction of incorporation or organisation and in the jurisdiction referred to in that clause (if different); and

• (ii) any judgment obtained against it in that jurisdiction will be recognised and enforced in its jurisdiction of incorporation or organisation.

• (r) ( Not a trustee ) No Undertaking Company enters into any Bank Document as trustee of any trust or settlement.

• (s) ( Legal and beneficial owner ) Each Undertaking Company is the legal and beneficial owner of its assets and undertaking.

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• (t) ( Security Interest ) There is no Security Interest over any of its assets or undertaking other than a Permitted Security Interest.

• (u) ( Commercial benefit ) The entering into and performance by each Undertaking Company of its obligations under the Bank Documents to which it is expressed to be a party is for its commercial benefit and is in its commercial interests.

• (v) ( Solvency ) There are no reasonable grounds to suspect that any Undertaking Company is unable to pay its debts as and when they become due and payable.

• (w) ( No benefit to related party or financial assistance ) No person has contravened nor will contravene section 208, section 209 or Part 2J.3 of the Corporations Act (or similar laws under the laws of any other jurisdiction which may be applicable to it) by entering into any Bank Document or participating in any transaction in connection with a Bank Document.

• (x) ( No change in affairs ) There has been no change in any Relevant Company’s state of affairs since the end of the accounting period for its most recent financial reports or accounts, which has had or is likely to have a Material Adverse Effect.

• (y) ( Disclosure ) All information provided to Westpac by or on its behalf in relation to it, its assets, business or affairs or the Bank Documents was correct and not misleading (by omission or otherwise) as at the time it was provided.

• (z) ( Full disclosure ) It has disclosed in writing to Westpac all facts relating to it and its subsidiaries, the Bank Documents and all things in connection with them, which are material to the assessment of the nature and amount of the risk undertaken by Westpac in entering into the Bank Documents and doing anything in connection with them.

• (aa) (Holding Company) No Undertaking Company is a “holding company”, or a “subsidiary company” of a “holding company”, or an “affiliate” of a “holding company” or of a “subsidiary company” of a “holding company”, or a “public utility” within the meaning of the United States Public Utility Holding Company Act of 1935, as amended.

• (bb) (ERISA.) Any United States of America incorporated Undertaking Company and its Subsidiaries ( Sims US Company ) have satisfied the minimum funding standards under the ERISA, as amended, with respect to its employee benefit plans and is in compliance in all material respects with the presently applicable provisions of such Act. Except to the extent that certain nonqualifying deferred compensation plans or certain amounts paid in relation to separation of employment of former employees John Mike and Alan D Ratner or all or any portion of the 401 (K) plan at any time associated with Simsmetal America (including without limitation any portion related to any matching contributions made by Simsmetal America to such 401(K) plan) constitute the maintenance, sponsorship, contributions to or obligation to contribute to any plan; no Sims US Company nor any ERISA affiliate of it maintains, sponsors, contributes to or is obligated to contribute to, or during the five (5) years ending on the date of execution and delivery of this Agreement, has maintained, sponsored, contributed to or was obligated to contribute to, any plan. None of its assets are, or are deemed to be “plan assets” whether by operation of law or under regulations promulgated under ERISA.

• (cc) (Federal Reserve Regulations) No Undertaking Company is engaged principally, nor as one of its important activities, the business of extending credit for the purpose of purchasing or carrying any margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve System). No part of the proceeds of the loan will be used., whether immediately, incidentally or ultimately, for any purpose, which violates

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or is inconsistent with any of the provisions of Regulations G, T, U, or X of the Board of Governors of the Federal Reserve System.

• (dd) (Margin Regulations) No Undertaking Company is engaged in the business of extending credit for the purpose of purchasing or carrying any margin stock or margin securities (within the meaning of Regulations U and X issued by the Board of Governors of the Federal Reserve System), and no proceeds of accommodation under Bank Documents will be used, directly or indirectly, to purchase or carry any margin stock or margin securities or to extend credit to others for the purpose of purchasing or carrying any margin stock or margin securities.

• (ee) (Not an Investment Company; Public Utility Holding Company) No Undertaking Company is, nor during the term of the loan will it be, (a) an “investment company” within the meaning of the Investment Company Act of 1940, as amended, or (b) subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act or any (whether US or not), federal or local statute or regulation limiting their ability to incur indebtedness for money borrowed as contemplated by any Bank Document.

3 REPETITION OF REPRESENTATIONS AND WARRANTIES

Each of the representations and warranties contained in clause 2 are made on the date of acceptance of this letter and shall be repeated on the date of each drawdown of financial accommodation under any Bank Document.

4 UNDERTAKINGS

Each Undertaking Company undertakes as follows, to the extent that the undertaking applies to it. It also undertakes to ensure that each Relevant Company complies with the following, to the extent that the undertaking applies to a Relevant Company. In each case these apply unless Westpac gives written consent otherwise.

• (a) (Information) It will provide the following:

• (i) promptly after each relevant accounting period (but within 90 days for a full year and 90 days for half year), copies of the Sims Group consolidated audited annual and unaudited semi-annual balance sheet, cashflow statements and profit and loss statements;

• (ii) when it provides those accounts or statements, a certificate of a director certifying as to whether: an Event of Default subsists, its representations are true, and it complies with the financial undertakings in clause 5;

• (iii) promptly, all documents issued by it to its shareholders;

• (iv) promptly, advice of any material change to the terms of facilities provided by other lenders to members of the Sims Group;

• (v) promptly, notice of any litigation, arbitration, administrative or other proceeding in respect of it or any of its assets being commenced or threatened which is in excess of A$25,000,000 or its equivalent;

• (vi) as soon as it becomes aware, notice of any breach of any Environmental Law or the issuing of any proceedings or notice or requirements against or upon it or its assets in respect of, or which is likely to result in, any environmental

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liability or breach of any Environmental Law in each case, which has had, or is reasonably likely to have a Material Adverse Effect;

• (vii) as soon as it becomes aware, notice of any proposal of any Governmental Agency to compulsorily acquire the whole or a substantial part of its assets;

• (viii) as soon as it becomes aware, notice of the acquisition by it of a Subsidiary; and

• (ix) promptly, any other information reasonably requested by Westpac.

Any account or statement must give a true and fair view and generally accepted accounting principles must have been consistently applied in the preparation of such accounts or statements.

• (b) (Notice of default) It will notify Westpac as soon as it becomes aware of any Event of Default, or event which with giving of time or notice or both would become an Event of Default (including any breach of a Bank Document) occurring, together with full details of such event and any step taken or proposed to remedy it.

• (c) (Negative Pledge):

• (i) Neither it nor a Relevant Company create or allow a Security Interest over any of its assets or enter any other transaction or arrangement which gives a creditor a preferential right to an asset owned or used by it other than a Permitted Security Interest.

• (ii) No Undertaking Company will deposit money with a person in circumstances where the money is not repayable unless the Undertaking Company performs obligations (including to pay money) to that person, except in respect of deposits which in aggregate do not exceed A$35,000,000 at any time.

• (iii) It must not enter into any arrangement which, if complied with, would prevent any Undertaking Company from complying with its obligations under the Bank Documents.

• (d) (Assets) Neither it nor a Relevant Company will dispose of 10% or more of its Total Tangible Assets or an interest in them or agree or attempt to do so (whether in one or more related or unrelated transactions) except:

• (i) where the disposals in the ordinary course of day to day trading;

• (ii) the disposals are of surplus assets no longer required for its business.

• (e) (Authorisations) Each Relevant Company will keep in force and comply with all Authorisations required in relation to the performance and enforceability of the Bank Documents.

• (f) (Change of business) The Relevant Companies will not substantially change the nature of the business or businesses carried on by them as a whole. No Relevant Company will take any action which would have that effect, whether by disposal, acquisition or otherwise.

• (g) (Arms length dealings) No Undertaking Company will deal with any other party except at arms length for full commercial consideration in the ordinary course of business.

• (h) (Environmental Law) Each Undertaking Company will maintain procedures which in the opinion of Westpac are adequate to monitor its compliance with laws relating to

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the environment planning and health or any authorisation under any of those laws, and which are adequate to deal with circumstances which may give rise to a claim or a requirement of substantial expenditure by it pursuant to these laws.

• (i) (Guarantors) It will ensure that:

• (i) the guarantors under the interlocking Guarantee dated 15 November 2000 between (amongst others) the Guarantors and Westpac ( Group Guarantee ) (excluding any German Guarantors) will:

  • (A) at all times own, in aggregate, at least 80% of Total Tangible Assets of the Sims Group; and

  • (B) generate at least 80% of the EBITDA for each Calculation Period ending on a Calculation Date of the Sims Group,

  • or in the case of a newly acquired or created Subsidiary or where assets or a business have been newly acquired, the guarantors under the Group Guarantee will own at least 80% of Total Tangible Assets and generate at least 80% of EBIIDA within 3 months of such acquisition or creation; and

• (ii) where a Subsidiary owns at least 5% of Total Tangible Assets at any time or generates at least 5% of EBITDA for a Calculation Period ending on a Calculation Date, the Subsidiary must become a New Guarantor in accordance with the Group Guarantee within 3 months of the earlier of becoming the owner of 5% of Total Tangible Assets or the relevant Calculation Date, unless Westpac is provided with a written legal advice (in a form satisfactory to Westpac, acting reasonably) from a law firm in the jurisdiction in which the Subsidiary was incorporated to the effect that the accession of the Subsidiary to the Group Guarantee as a Guarantor on the terms of the Group Guarantee would be contrary to the law under which the Subsidiary was incorporated or carries on a substantial portion of its business.

Documentation to add guarantors must be to Westpac’s satisfaction. All guarantors must provide evidence of due execution of documentation (for example, verification certificate). All foreign guarantors must within 3 months of becoming a guarantor must provide a legal opinion in a form satisfactory to Westpac.

• (j) (Amend Bank Documents) It will if requested by Westpac negotiate in good faith, and after agreement promptly implement any changes to the Bank Documents that Westpac reasonably believes necessary to ensure that the Bank Documents reflect terms at least as favourable as those afforded by the Sims Group to other lenders.

• (k) (Foreign Borrowers legal opinions) All foreign borrowers must within 3 months of becoming a borrower provide a legal opinion in a form satisfactory to Westpac.

• (l) ( Secured Indebtedness ) Secured Indebtedness must not exceed 5% of Total Tangible Assets.

• (m) ( Directors’ certificate ) At Westpac’s request, provide a certificate signed by at least 2 directors of Sims stating:

• (i) if an Event of Default subsists or an event which with time or notice or both would become an Event of Default; and

• (ii) if so, full details of the relevant Event of Default or other event referred to in paragraph (i) and the remedial action being taken or proposed.

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• (n) ( Compliance ) It must, and Sims must, ensure that each other member of the Sims Group will:

• (i) comply with all its obligations under each Bank Document to which it is a party; and

• (ii) ensure that no Event of Default occurs.

• (o) ( Maintenance of capital ) It will ensure that no Relevant Company takes any action to reduce its capital, cancel its uncalled capital or buy back its shares ( Capital Reduction ) if the Capital Reduction would, in aggregate with any other Capital Reductions by the Relevant Company in the preceding year, result in a reduction of the issued ordinary capital of the Relevant Company of greater than or equal to 10% for that year (however any Capital Reduction may not in any event be made if it causes a breach of the financial undertakings in clause 5).

• (p) ( Compliance with laws and Authorisations ) It must, and Sims must, ensure that each Relevant Company will:

• (i) comply with all laws and legal requirements, including each judgement, award, decision, finding or any other determination of a Governmental Agency, which applies to it or any of its assets, where failure to do so will have or be likely to have a Material Adverse Effect;

• (ii) obtain, maintain and comply with:

  • (A) all Authorisations required in relation to the entry into, performance of obligations under, and enforceability of, each Bank Document to which it is a party; and

  • (B) all Authorisations that are material to the carrying on of the business of the Sims Group (taken as a whole) where failure to do so has or is likely to have a Material Adverse Effect,

  • and ensure those Authorisations are not cancelled, suspended, not renewed, varied or found to be invalid; and

• (iii) not do anything which would prevent the renewal of any Authorisation referred to in clause 4(p)(ii) or cause it to be renewed on less favourable terms.

• (q) ( Payment of Taxes and other outgoings ) It must pay all Taxes when due, other than:

• (i) contested Taxes; and

• (ii) where failure to do so will not have or be likely to have a Material Adverse Effect.

• Each Undertaking Company must pay all contested Taxes when the terms of any final determination or settlement require those contested Taxes to be paid.

• (r) ( Conduct of business ) It must conduct its business (including collecting debts owed to it) in a proper, orderly and efficient manner.

• (s) ( Maintenance of existence ) It must, and Sims must, ensure that each Relevant Company will:

• (i) maintain its corporate existence, good standing and registration in the jurisdiction of its organisation or incorporation;

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• (ii) not transfer its jurisdiction of organisation or incorporation;

• (iii) not enter into any amalgamation, demerger or corporate reconstruction where such event has or would be likely to have a Material Adverse Effect, except a solvent amalgamation or reconstruction on terms agreed by Westpac; and

• (iv) not amend its constitution or any other constituent document of it where such amendment has or would be likely to have a Material Adverse Effect, without Westpac’s prior written consent.

• (t) ( Financial accommodation ):

• (i) It must not provide any financial accommodation, or give any guarantee in respect of any financial accommodation other than financial accommodation provided to an Undertaking Company, to or for the benefit of any person, other than Permitted Financial Accommodation or with the prior written consent of Westpac.

• (ii) It must not permit financial accommodation to remain owing to it by a Relevant Company which is not an Undertaking Company.

• (iii) It must not satisfy any financial accommodation owed to a Relevant Company which is not an Undertaking Company except any financial accommodation which, in aggregate with all other financial accommodation owed by an Undertaking Company to a Relevant Company which is not an Undertaking Company that is satisfied in the 12 month period prior to the date on which the financial accommodation is to be satisfied, does not exceed A$10,000,000.

• (u) ( Maintenance of assets ) Each Undertaking Company, other than an Undertaking Company whose assets comprise less than 2% of the Total Tangible Assets or an Undertaking Company whose profits from ordinary activities account for less than 2% of EBITDA, must maintain and keep its assets in a good state of repair and in good working order allowing for fair wear and tear except where failure to do so would not have a material adverse effect on:

• (i) the financial condition of the Undertaking Company;

• (ii) its ability to perform any of its obligations under a Bank Document; or

• (iii) any encumbrance provided to Westpac by that Undertaking Company.

• (v) ( Insurance ) Each Undertaking Company must, and must ensure that each Relevant Company will:

• (i) maintain industrial special risks insurance, public liability insurance, professional indemnity liability insurance and directors and officers liability insurance with an independent and reputable insurer and consistent with the insurances maintained by it as at the date of this agreement;

• (ii) otherwise insure, and keep insured, its property which is of an insurable nature in the manner and to the extent which is in accordance with good business practice for property of such nature; and

• (iii) promptly following a request by Westpac, provide Westpac with any certificates of currency or other evidence of currency in respect of all insurances required to be maintained by it under this agreement.

• (w) ( Hedging ) It must not (and in the case of Sims, must ensure that no Relevant Company will) enter into a Hedging Agreement except:

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• (i) for the purposes of hedging that Undertaking Company’s actual or projected interest rate, foreign exchange or other exposures arising in the ordinary course of its ordinary business and not for speculative purposes; or

• (ii) with Westpac’s prior written consent.

• (x) ( Deed of Cross Guarantee ) An Undertaking Company:

• (i) must not consent to the amendment, termination, revocation, suspension, repudiation of, or waive its rights arising under, any Deed of Cross Guarantee to which it is a party without Westpac’s consent (which consent may be withheld in Westpac’s absolute discretion or, where granted, may be subject to such terms as Westpac, in its absolute discretion, requires); and

• (ii) must notify Westpac immediately upon it becoming aware of any proposal or request or requirement that it provide a consent or waiver in respect of any Deed of Cross Guarantee to which it is a party.

Paragraphs (c) and (d) do not apply to any disposal if such disposal cannot be prohibited pursuant to Sections 1136 German Civil Code (Bürgerliches Gesetzbuch).

It will promptly remedy any material breaches or circumstances referred to above.

5 FINANCIAL UNDERTAKINGS

Each Undertaking Company must ensure that on each Calculation Date:

• (a) the ratio of Finance Debt to EBITDA for the Calculation Period ending on that Calculation Date is not greater than 3.0:1;

(b) the ratio of EBITDA to Net Interest Expense for the Calculation Period ending on that Calculation Date is not less than 3.5:1; and

• (c) TNW is at least 85% of the TNW calculated for the last Calculation Date of the preceding financial year.

6 EVENTS OF DEFAULT

Each of the following is an Event of Default (even if outside the control of any Undertaking Company except as stated below).

(a) (Obligations under transaction documents) Any Undertaking Company fails to do any of the following:

• (i) to pay principal under a Bank Document or any interest or other amount under a Bank Document on the due date unless the interest or other amount is paid within 2 days of the due date and it demonstrates to the satisfaction of Westpac that the delay was due to a failure in transmission of funds outside of its control where the funds were available to it with a bank and it gave the requisite instructions;

• (ii) to comply with its financial undertakings in clause 5; or

• (iii) to comply with any other obligation in a Bank Document and, if in the opinion of Westpac that failure can be remedied within 10 Business Days, does not remedy that failure within 10 Business Days of notice of that failure.

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• (b) (Misrepresentation) A representation or statement by or on behalf of an Undertaking Company in a Bank Document, or in a document provided under it, is misleading in a material respect.

• (c) (Cross Default) Finance Debt of a Relevant Company totalling at least A$5,000,000 or its equivalent or of the Relevant Companies totalling (in aggregate for all such Relevant Companies) at least A$25,000,000 or its equivalent:

• (i) is not paid when due (or within an applicable grace period) except where it is being contested in good faith; or

• (ii) becomes due and payable before its stated maturity, except as a result of an exercise of a prepayment right in the absence of default.

An obligation to provide finance to a Relevant Company totalling at least A$5,000,000 or its equivalent or to the Relevant Companies totalling (in aggregate for all such Relevant Companies) at least A$25,000,000 or its equivalent, is terminated except as a result of voluntary termination in the absence of default.

• (d) (Enforcement against assets) A Security Interest is enforced, or distress, attachment, execution or other process of a Governmental Agency is issued or levied, against any asset or a Relevant Company with a value or in an amount of at least A$10,000,000 or its equivalent or an asset or assets of Relevant Companies totalling (in aggregate for all such Relevant Companies) at least A$25,000,000 or its equivalent, and is not set aside or satisfied within 10 Business Days.

• (e) (Maintenance of capital and existence) An Undertaking Company fails to comply with clause 4(o) or 4(s).

• (f) (Insolvency) A Relevant Company is Insolvent.

• (g) (Bank Documents) All or a material part of a Bank Document is for any reason:

• (i) terminated or of no force or limited force; or

• (ii) terminable at the option of the Relevant Company,

• except as expressly provided under that Bank Document. A Relevant Company alleges it is so.

• (h) (Ceasing business) An Undertaking Company stops payment, significantly changes the general character of its business or threatens to do any of those things, or a Relevant Company ceases to carry on business, except to reconstruct or amalgamate while solvent, and which event may have a Material Adverse Effect.

• (i) (Environmental) If there is any claim or requirement of expenditure or cessation of activity under any law relating to the environment, planning or health which in the opinion of Westpac is likely to have a Material Adverse Effect or any circumstances arises which may give rise to such a claim or requirement.

• (j) (Governmental interference) A law or anything done by a Governmental Agency is likely to in the opinion of Westpac have a Material Adverse Effect.

• (k) (CBA event of default) an event of default, termination event (other than a termination event under a Hedging Agreement with Commonwealth Bank of Australia in respect of which Commonwealth Bank of Australia is an “Affected Party” (as defined in that Hedging Agreement)) or other similar event occurs under any agreement relating to Finance Debt between a Relevant Company and Commonwealth Bank of Australia.

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• (l) ( Disposal without consent ) A disposal which cannot be prohibited pursuant to Section 1136 German Civil Code (Bürgerliches Gesetzbuch), if the disposal has not been approved by Westpac in writing, provided such disposal corresponds to a disposal set out in clause 4 (c) and (d).

• (m) ( Unenforceability ):

• (i) All or a material part of a Bank Document of Westpac is illegal, void, voidable or unenforceable;

• (ii) A Relevant Company becomes entitled to terminate any material provision of any Bank Document (other than following the occurrence of a termination event or an Event of Default under a Hedging Agreement with Westpac in respect of which Westpac is an “Affected Party” or the “Defaulting Party” (as applicable) as defined in that Hedging Agreement); or

• (iii) The execution, delivery or performance of a Bank Document by an Undertaking Company or the exercise by Westpac of all or any of its rights under a Bank Document breaches or results in a contravention of any law.

• (n) ( Seizure ) All or any material part of the assets of the Sims Group are seized or otherwise appropriated by, or custody thereof is assumed by any Governmental Agency, or the Sims Group is otherwise prevented from exercising normal day-to-day control over all or a material part of its assets or loses any of the rights or privileges necessary to maintain its existence or to carry on its business and Sims does not demonstrate to the reasonable satisfaction of Westpac within 15 Business Days of such seizure, appropriation, assumption of custody or execution that no Material Adverse Effect has resulted, or is reasonably likely to result, therefrom.

• (o) ( Event of default ) An event of default, termination event (other than a termination event under a Hedging Agreement with Westpac in respect of which Westpac is an “Affected Party” (as defined in that Hedging Agreement)) or other similar event occurs with respect to a Relevant Company under any agreement relating to Finance Debt between a Relevant Company and Westpac including the occurrence of an event which is an “event of default” with respect to a Relevant Company under any Bank Document, or any other event occurs which renders enforceable a Bank Document which comprises or includes a guarantee.

• (p) ( Investigation ) A person is appointed under the Corporations Act or any other applicable legislation to investigate any part of the affairs of an Undertaking Company and the relevant Undertaking Company does not demonstrate to the reasonable satisfaction of Westpac within 15 Business Days of such appointment that no Material Adverse Effect has resulted from, or is reasonably likely to result from, the investigation or as a consequence thereof.

• (q) ( Deregistration ) A step is taken under section 601AA, 601AB or 601AC of the Corporations Act or analogous provisions in a relevant jurisdiction to cancel the registration of an Undertaking Company.

• (r) ( ASX delisting/suspension ): Except with the written consent of Westpac, any securities of Sims are:

• (i) not listed on at least one of:

  • (A) the official list of the Australian Securities Exchange operated by ASX Limited; or

  • (B) the official list of the New York Stock Exchange; or

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• (ii) suspended from quotation or trading on any official list referred to in clause 6(r)(i) for 5 consecutive trading days (except where such suspension is requested by Sims for the purpose of an acquisition or a fundraising and such securities remain suspended on that basis only and not on any other basis); or

• (iii) removed from the official list of any of:

• (A) the Australian Securities Exchange operated by ASX Limited;

• (B) the New York Stock Exchange; or

• (C) another stock exchange,

because the operator of the relevant stock exchange decides that Sims or its securities no longer meet the requirements for continued listing (except where Sims has requested such removal and that is the sole basis for the removal).

• (s) ( Material adverse effect ) Any event occurs which, in the reasonable opinion of Westpac, may have a Material Adverse Effect.

Nothing in paragraph (e), (f) or (h) is an Event of Default if done for a solvent reorganisation previously approved by Westpac.

7 WESTPAC’S REMEDIES AND POWERS

7.1 Event of Default

If an Event of Default occurs then Westpac may at any time either or both:

• (a) terminate any facility provided under any Bank Document; and

• (b) by written notice require each Undertaking Company to repay all amounts lent or provided to it under any Bank Document, and all other amounts actually or contingently outstanding by it under any Bank Document, and the Undertaking Company must pay them immediately.

If an amount is paid to Westpac to cover an amount contingently owing, Westpac will hold that amount in an interest bearing account until the amount becomes actually owing or ceases to be contingently owing. Westpac will then apply the amount in the account (including interest) in payment of the amount actually owing and return the balance to the relevant Undertaking Company.

Where a Bank Document specifies that a facility can be terminated by Westpac at any time, Westpac may at any time do either of the things specified in (a) or (b) above whether or not an Event of Default has occurred.

Any notice given by Westpac pursuant to paragraphs (a) or (b) shall be of no effect if:

• (a) it is given because of the occurrence of an Event of Default specified in paragraphs (a)(ii), (a)(iii), (b), (c), (e), (h) or (m) of clause 6; and

• (b) within two Business Days of the notice the Undertaking Company is able to show to the Westpac’s satisfaction that:

• (i) the Event of Default is not subsisting; or

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• (ii) where the notice relates to an Event of Default specified in clause 6(e) or 6(h), the Event of Default subsisting does not and will not have a Material Adverse Effect.

7.2 Application of money — set-off

If an Undertaking Company does not pay an amount when due, Westpac may apply any money in any of Undertaking Company’s accounts or deposits (whether or not matured) in payment of any amount payable by it under any Bank Document. It need not do so. It can convert currencies using its normal procedures provided those procedures are fair and reasonable to both Sims and Westpac.

7.3 No waiver

No failure to exercise a power, and no delay in exercising a power, operates as a waiver. Waivers must be in writing.

8 REVIEW

• (a) (Control) If Sims becomes controlled by another person then Westpac may within 90 days after notification of that change of control review the terms of any financial accommodation provided under any Bank Document. Following that review Westpac may require repayment of all or part of the financial accommodation provided to any Undertaking Company and terminate all facilities.

• For this purpose a corporation is controlled by a person or entity holding a relevant interest (as defined in the Corporations Act) of more than 50% of voting shares in Sims.

• (b) ( Listing ) If any securities of Sims are added to the official list of any stock exchange (other than the official list of the Australian Securities Exchange operated by ASX Limited and the official list of the New York Stock Exchange), then Westpac may, for a period of not less than 60 days after the date Westpac is notified of that event ( Listing Review Period ), review the terms of any financial accommodation provided under any Bank Document. Following the Listing Review Period Westpac may require repayment on demand of all or part of the financial accommodation provided to any Undertaking Company and terminate its facility under the Bank Documents, if Westpac, acting reasonably, believes that Sims’ presence on the official list of such a stock exchange, will have, or is reasonably likely to have, a Material Adverse Effect.

9 PAYMENTS

9.1 Method of payment

Each Undertaking Company will make all payments at the address on the execution page of this agreement or as specified by Westpac except where a Bank Document specifies otherwise. Payments must be in cleared funds and free of any set-off or deduction, except for Taxes where required by law.

9.2 Time of payment

Unless otherwise stated, amounts payable under any of the clauses “Yield protection”, and “Additional Payments” are payable within two Business Days of demand.

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10 YIELD PROTECTION

• Whenever Westpac determines that a Change in Law (as defined below) has the effect of:

• (a) increasing its costs of funding or maintaining a facility under a Bank Document, or reducing its return or amounts received in respect of the facility; or

• (b) reducing its return on capital allocated to a facility under a Bank Document (including because more capital needs to be allocated to the facility or cannot be used elsewhere),

then Westpac will promptly notify the relevant Undertaking Company, who must pay Westpac the amount Westpac certifies is necessary to compensate it. That certificate will give an outline of the calculation, and will be conclusive and bind the Undertaking Company in the absence of manifest error.

If the Undertaking Company so requests, Westpac will negotiate in good faith with a view to finding a means of minimising the effect, but is not a defence that the effect could have been avoided or minimised.

Change in Law is the commencement or introduction of, or a change in, any present or future law, regulation, treaty, order, official directive, ruling or request or a change in its interpretation, after the date of this Agreement. If it does not have the force of law, it must be one with which responsible Australian banks would comply. Without limitation, it includes any occurrence which is a “Change in Law” as described above and which relates to capital adequacy, special deposit, liquidity, reserve, prime assets, Tax or prudential requirements (except a change in Tax on overall net income).

It does not include a change where Westpac is entitled to receive adequate compensation under another provision of a Bank Document.

11 ILLEGALITY

• (a) If any Change in Law or other event makes it illegal for Westpac to perform its obligations under the Bank Documents or fund or maintain the facility under the Bank Documents, Westpac may by notice to Sims:

• (i) suspend all or part of its obligations under the Bank Documents for the duration of the illegality; or

• (ii) by notice to Sims, cancel all or part of its commitment under the Bank Documents and require the Undertaking Companies to repay the outstanding moneys in part or in full on the date which is 40 Business Days after the date on which Westpac gives the notice or any earlier date required by, or to comply with, the applicable law,

provided that if Westpac determines in its absolute discretion that the illegality can be avoided by a partial suspension or cancellation, then Westpac may only suspend its obligations or cancel its commitment under this clause to the extent it considers necessary to avoid the illegality.

• (b) A notice under clause 11(a) is irrevocable and the Undertaking Companies must, on the repayment date determined under clause 11 (a), pay to Westpac the outstanding moneys of in full.

• (c) If this clause applies, Westpac agrees to use reasonable endeavours for a period of 90 days to make the relevant financial accommodation available by some alternative

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means including changing its lending office or making the financial accommodation available through a related body corporate provided that nothing in this clause will oblige Westpac to incur any costs or expenses or take any action or refrain from taking any action where, in the opinion of Westpac, the taking of that action or the refraining from taking that action is impractical, may be prejudicial to Westpac or is contrary to Westpac’s policies.

12 CONFIDENTIAL INFORMATION

Westpac must not disclose to any person:

• (a) any Bank Document; or

• (b) any information about any Undertaking Company,

except:

• (c) in connection with a permitted assignment, novation, participation or securitisation, or a proposed permitted assignment, novation, participation or securitisation, where the disclosure is made on the basis that the recipient of the information will comply with this clause in the same way that Westpac is required to do;

• (d) to any professional or other adviser consulted by it in relation to any of its rights or obligations under the Bank Documents;

• (e) to the Reserve Bank of Australia, the Australian Tax Office or any Governmental Agency requiring disclosure of the information;

• (f) in connection with the enforcement of its rights under the Bank Documents;

• (g) where the information is already in the public domain, or where the disclosure would not otherwise breach any duty of confidentiality;

• (h) if required by law or by regulation; or

• (i) otherwise with the prior written consent of the relevant Undertaking Company (such consent not to be unreasonably withheld).

13 ADDITIONAL PAYMENTS

13.1 Indemnity and costs

Each Undertaking Company will pay Westpac’s reasonable legal costs (including goods and services tax or similar tax) in relation to the preparation of each Bank Document to which it is a party and any security for its obligations, and any amendment of it, or any consent or waiver. (In respect of the preparation of this agreement, company searches referred to in conditions precedent to Bank Documents and the Bank Documents prepared around the date of this agreement, legal costs on account of preparation are capped at A$5,000.)

Subject to clause 15.3, each Undertaking Company will indemnify Westpac against any liability, loss, cost or expense (including legal costs on a full indemnity basis and including any goods and services tax or similar tax) it incurs in or as a result of an Event of Default or a breach of its obligations, or in the actual or contemplated enforcement of this agreement or any Bank Document to which it is a party or in the actual or contemplated enforcement of any security.

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Each Undertaking Company will, to the fullest extent permitted by law, indemnify and hold harmless Westpac and its respective directors, officers, employees and agents, from and against any and all claims, damages, liabilities and expenses (including, without limitation, reasonable attorney costs) for which any of them may become liable or which may be incurred by or asserted against Westpac or any such director, officer, employee or agent, in each case in connection with or arising out of or by reason of any investigation, litigation, or proceeding, whether or not Westpac or any such director, officer, employee or agent is a party thereto, arising out of, related to or in connection with any Bank Document or any transaction in which any proceeds of all or any part of the accommodation under Bank Documents are applied or proposed to be applied; EXPRESSLY INCLUDING ANY SUCH CLAIM, DAMAGE, LIABILITY OR EXPENSE ARISING OUT OF THE ORDINARY, SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH INDEMNIFIED PERSON (but excluding any such claim, damage, liability or expense to the extent attributable to the gross negligence or wilful misconduct of, or violation of any law or regulation by, any such indemnified Person). The undertaking in this clause shall survive the payment of all or any accommodation under Bank Documents.

13.2 Goods and Services Tax

• (a) Notwithstanding any other provision of this agreement, any amount payable to Westpac under this agreement does not include any goods and services tax or similar tax by whatever name called (including GST ) Terms defined in the GST law have the same meaning in this agreement.

• (b) To the extent that any supply under or in connection with this agreement by Westpac constitutes a taxable supply, the consideration payable will automatically be increased to include an additional amount on account of GST. That amount will be the product of the value of the consideration for the supply and the prevailing GST rate.

• (c) Notwithstanding any other provision in this agreement if, for the purposes of GST law, Westpac is not entitled to an input tax credit in respect of the whole or part of any GST payable on a supply acquired by Westpac in connection, whether directly or indirectly, with this agreement, Westpac may increase the amounts paid or payable under this agreement to the extent necessary to recoup the input tax incurred by Westpac in connection with that supply.

13.3 Tax

If an Undertaking Company is required to deduct any Tax from any payment under a Bank Document (except a Tax on Westpac’s overall net income), then:

• (a) the Undertaking Company must pay that amount to the appropriate authority and promptly give Westpac evidence of payment; and

• (b) the amount payable is increased so that (after deducting that Tax, and paying any Taxes on the increased amount) Westpac receives the same amount it would have received had no deduction been made.

• 13.4 Tax Credit

• If an Undertaking Company makes an additional payment under clause 13.3 and Westpac determines that:

• (a) a credit against, relief or remission for, or repayment of any Tax ( Tax Credit ) is attributable to that additional payment; and

• (b) Westpac has obtained, utilised and retained that Tax Credit,

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then Westpac must pay an amount to the Undertaking Company which Westpac determines will leave it (after that payment) in the same after tax position as it would have been in had the additional payment not been made by the Undertaking Company.

13.5 Currency Indemnity

Each Undertaking Company will indemnify Westpac if any amount payable under or in connection with a Bank Document is received in a currency which is different from that in which it is required to be paid under this agreement. This indemnity applies whatever the reason for receipt of the amount in a different currency.

13.6 Stamp duty

Each Undertaking Company will pay all stamp, transaction and other similar duties and charges in relation to this agreement or any Bank Document to which it is a party and any security for its obligations and any transaction under them. This includes financial institutions duty and debits Tax. Each Undertaking Company will also pay any fines and penalties unless they result from a failure by Westpac to lodge a document for stamping in sufficient time, having received from the Undertaking Company the amount of stamp duty in good time.

14 NEW PARTIES

A party can join this agreement as an Undertaking Subsidiary and if Westpac agrees, can be joined to other Bank Documents. To do so it must sign an accession agreement in the form attached. Upon signing the accession agreement the party will automatically become an Undertaking Subsidiary under this agreement (and assume the nominated status under any Bank Document set out in the accession agreement) and have the same obligations and rights as if named in the Subsidiaries Schedule and as if it had signed this agreement and that other Bank Document.

Sims will promptly advise Westpac of the acquisition or creation of a new Subsidiary. Sims will also advise Westpac if it is necessary for that Subsidiary to become a party to the interlocking Guarantee dated 15 November 2000 in order to ensure compliance with Undertaking clause 4(i).

15 GENERAL

15.1 Statement

A written statement by Westpac as to any amount due under a Bank Document will be sufficient evidence of that amount unless the relevant Undertaking Company proves it wrong.

15.2 Term

This agreement will continue so long as there is any liability, obligation, document or agreement between Westpac and any Relevant Company or until Westpac releases it whichever event occurs earlier.

15.3 Dispute resolution

• (a) If an Issue or a circumstance that is reasonably likely to result in an Issue, arises Sims and Westpac must not commence any court proceedings relating to the Issue unless it has complied with the provisions of this clause 15.3, except to seek urgent interlocutory relief.

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• (b) If Sims or Westpac becomes aware of an Issue or a circumstance that is reasonably likely to result in an Issue, it must promptly notify the other ( Initial Notice ), and if the Issue is not resolved within ten (10) Business Days from the date of that Initial Notice (excluding the date of that Initial Notice) (or such other period as agreed to in writing between Sims and Westpac), then either Sims or Westpac may give a written notice to the other specifying the nature and details of the Issue ( Notification ).

• (c) If an Issue is resolved within ten (10) Business Days from the date on which Initial Notice is provided (excluding the date on which Initial Notice is given) (or such other period as agreed to in writing between Sims and Westpac), Sims and Westpac must exchange written acknowledgement of such resolution prior to the end of the ten (10) Business Day period.

• (d) Once a Notification is given in accordance with clause 15.3(b), a Dispute is taken to have arisen. If no Notification is given in accordance with clause 15.3(b) or the Issue is resolved and written acknowledgement has been exchanged between Sims and Westpac in accordance with clause 15.3(c), a Dispute will not be taken to have arisen in relation to the Issue and the provisions of this clause 15.3 will no longer apply. If the provisions of this clause 15.3 no longer apply as a result of the failure of either Sims or Westpac to give a Notification, the matter or thing asserted by either Sims or Westpac which gave rise to the Issue will be disregarded.

• (e) If Sims and Westpac do not resolve the Dispute within ten (10) Business Days after the Notification is given (excluding the date on which the Notification is given) (or such other period as agreed to in writing between Sims and Westpac) either Sims or Westpac may submit the Dispute to expert determination.

• (f) If the Dispute is referred to expert determination under clause 15.3(e):

• (i) both Sims and Westpac may nominate an independent expert with relevant expertise in accounting, legal and commercial matters to act as expert and submit this nomination to the other within the earlier of twelve (12) Business Days after the Notification is given (excluding the date on which the Notification is given), or two (2) Business Days following a decision by Sims and Westpac to submit the Dispute to expert determination (excluding the date on which that decision is reached) (or such other period as agreed to in writing between Sims and Westpac);

• (ii) if only Westpac or only Sims nominates an expert in accordance with clause 15.3(f)(i), the nominated expert will be taken to have been agreed to by both Sims and Westpac and that expert will be validly appointed;

• (iii) if Sims and Westpac do not agree on the appointment of an expert within three (3) Business Days after both expert nominations have been submitted (excluding the date on which both nominations have been submitted), the matter will be referred to the President of the Institute of Chartered Accountants of Australia who will nominate an expert to determine the Dispute and both Sims and Westpac will accept this nomination;

• (iv) where Sims is engaged in a dispute with any of its other lenders (which have adopted a dispute resolution clause in substantially the same form as this clause 15.3) in relation to the same subject matter as a Dispute or Issue between Sims and Westpac, Westpac agrees to the common appointment of an expert to resolve the disputes simultaneously and an expert appointed in these circumstances can only be appointed if the expert accepts a common appointment;

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• (v) the terms of the expert’s retainer must provide that in resolving the Dispute the expert will, to the extent relevant, be subject to the then current ACDC Guidelines for Expert Determination, and will use all reasonable endeavours to ensure that if a Dispute relates to a current Calculation Period a decision is reached prior to the Calculation Date for that Calculation Period;

• (vi) the terms of the expert’s retainer must provide that the expert must provide a decision as soon as reasonably practicable and in any event no later than the five (5) Business Days from the date of referral (excluding the date of referral) (or such other period as agreed to in writing between Sims and Westpac);

• (vii) the decision of the expert is final and binding on Westpac and the Undertaking Companies except in the case of manifest error; and

• (viii) if, for any reason:

• (A) an expert is not appointed within five (5) Business Days of the expert appointment decision being referred to the President of the Institute of Chartered Accountants of Australia (excluding the date on which the matter is referred);

• (B) or the appointed expert provides Sims and Westpac with written confirmation that the expert is unable to reach a decision in relation to the Dispute,

• the provisions of this clause 15.3 will no longer apply to the Dispute and each of Sims and Westpac may:

• (C) commence court proceedings; and/or

• (D) pursue any other remedies that are available to the relevant party,

in relation to the matter or thing forming the subject matter of the Dispute.

• (g) If a Dispute or Issue first arises prior to the end of a Calculation Period and is not resolved in accordance with this clause 15.3 by the end of that Calculation Period, Sims and Westpac agree to use reasonable endeavours to resolve the Dispute or Issue as soon as possible following the relevant Calculation Date and in any event no later than 30 Business Days following Sims and Westpac first becoming aware of the Issue (excluding the date on which both Sims and Westpac first become aware of the Issue) (or such other period as agreed to in writing between Sims and Westpac).

• (h) Westpac agrees that prior to the resolution of the Dispute or Issue in accordance with the provisions of this clause 15.3, or the termination of the dispute resolution process as contemplated by clause 15.3(f)(viii), the subject matter of any Dispute or Issue may not be taken into account in determining whether Sims is in breach of any of the financial undertakings contained in clause 5 of these Standard Terms that require EBITDA to be calculated.

• (i) Sims must bear the costs of complying with this clause 15.3 and comply with the obligations under the Bank Documents during the dispute resolution process contained in this clause 15.3.

• (j) In acting under the provisions of this clause 15.3 Sims and Westpac must at all times use reasonable endeavours to resolve any Dispute or Issue.

• (k) Each Undertaking Company represents and warrants for the benefit of Westpac that each Other Document that requires or contemplates adjustments to EBITDA contains a dispute resolution clause in substantially the same form as this clause 15.3.

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15.4 Assignment

• (a) No Undertaking Company may assign its rights under any Bank Document. Westpac may transfer any part of its rights and, with an Undertaking Company’s consent, its obligations. An Undertaking Company will not withhold that consent unreasonably. With the prior consent of Sims which consent will not be withheld unreasonably, Westpac may disclose information concerning a Bank Document or an Undertaking Company to a potential transferee or sub-participant Westpac may transfer any part of its rights with the prior consent of Sims which consent will not be withheld unreasonably. Westpac may from time to time change its office at which accommodation is made or carried, provided that if at the time of any change from one office to another the effect thereof would be to increase any amount payable by an Undertaking Company under a Bank Document then such change shall not be made without the prior written consent of Sims.

• (b) Notwithstanding any other provision set forth in a Bank Document, Westpac may at any time assign, as collateral or otherwise, any of its rights (including, without limitation, rights to payments of principal and/or interest on accommodation) under a Bank Document in respect of accommodation made or carried by a Westpac office in the United States of America to any Federal Reserve Bank without notice to, or consent of, the Undertaking Companies or any of their agents, successors or assigns.

• (c) Where Westpac wants to transfer any part of its obligations the relevant Undertaking Company will sign when reasonably requested by Westpac a document which will effect that transfer and which does not increase the Undertaking Company’s obligations. Westpac will bear its own costs and stamp duty on that document.

15.5 Notices

• (a) Any notice, demand, statement, certificate or other communication by Westpac under any Bank Document may be given by any person whose title includes the word a manager, a counsel, a head or a president, or any attorney authorised to do so.

• (b) Notices may be sent by facsimile, post or any other means to the recipient’s address or number set out on the signature page of this agreement or to any other address or number notified to the sender by the recipient.

• (c) Notices will be taken to have been given if delivered or left at that address on the date on which they are delivered or left.

15.6 Governing law and jurisdiction

This agreement is governed by NSW law. Each Undertaking Company accepts the non-exclusive jurisdiction of the courts having jurisdiction there in relation to each Bank Document.

SUBSIDIARIES SCHEDULE

Name of company	Corporation number	Jurisdiction of incorporation / registration / organisation
Sims Group Australia Holdings Limited	008 634 526	Australia
Sims Metal Management Limited	114 838 630	Australia

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Name of company	Corporation number	Jurisdiction of incorporation / registration / organisation
Simsmetal Holdings Pty Limited	000 021 563	Australia
Simsmetal Services Pty Limited	000 166 987	Australia
Sims Manufacturing Pty Limited	004 332 870	Australia
Sims Industrial Pty Limited	000 090 479	Australia
Sims Energy Pty Limited	009 667 752	Australia
Sims Group UK Limited	3242331	UK
Sims Group UK Holdings Limited	2904307	UK
Mirec BV	17073024	The Netherlands
Sims Recycling Solutions AB	N/A	Sweden
Simsmetal Industries Limited	N/A	New Zealand
Sims M+R GmbH	N/A	Germany
Sims Group German Holdings GmbH	N/A	Germany
Sims Metal Management Asia Limited	N/A	Hong Kong
Sims Group Recycling Solutions Canada Ltd	N/A	Canada
Sims Group Canada Holdings Limited	N/A	Canada
Sims Group USA Corporation	N/A	Delaware
Sims Group Global Trade Corporation	N/A	Delaware
North Carolina Resource Conservation, LLC	N/A	North Carolina
Sims Group USA Holdings Corporation	N/A	Delaware
SHN Co., LLC	N/A	Delaware
HNE Recycling LLC	N/A	Delaware
HNW Recycling LLC	N/A	Delaware
Schiabo Larovo Corporation	N/A	Delaware
Simsmetal East LLC	N/A	Delaware
Simsmetal West LLC	N/A	Delaware
Sims Recycling Solutions Holdings, Inc. (formerly Sims Recycling Solutions, Inc.)	N/A	Illinois
Sims Recycling Solutions, Inc. (formerly United Refining & Smelting Co.)	N/A	Illinois
Metal Management, Inc.	N/A	Delaware
CIM Trucking, Inc.	N/A	Illinois
Metal Management Alabama, Inc.	N/A	Delaware
Metal Management Arizona, L.L.C.	N/A	Arizona
Metal Management Connecticut, Inc.	N/A	Delaware
Metal Management Indiana, Inc.	N/A	Illinois
Metal Management Memphis, L.L.C.	N/A	Tennessee
Metal Management Midwest, Inc.	N/A	Illinois
Metal Management Mississippi, Inc.	N/A	Delaware
Metal Management New Haven, Inc.	N/A	Delaware
Metal Management Northeast, Inc.	N/A	New Jersey
Metal Management Ohio, Inc.	N/A	Ohio
Metal Management Pittsburgh, Inc.	N/A	Delaware
Metal Management Proler Southwest, Inc.	N/A	Delaware
Sims – North America Trade Corporation	N/A	Delaware
Metal Management West Coast Holdings, Inc.	N/A	Delaware
Metal Management West, Inc.	N/A	Colorado
MM Metal Dynamics Holdings, Inc.	N/A	Delaware

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Name of company	Corporation number	Jurisdiction of incorporation / registration / organisation
Naporano Iron & Metal, Inc.	N/A	Delaware
New York Recycling Ventures, Inc.	N/A	Delaware
Proler Southwest GP, Inc.	N/A	Delaware
Proler Southwest LP	N/A	Texas
Reserve Iron & Metal Limited Partnership	N/A	Delaware
Metal Dynamics LLC	N/A	Delaware
Metal Dynamics Detroit LLC	N/A	Delaware
Metal Dynamics Indianapolis LLC	N/A	Delaware
Sims Municipal Recycling of New York LLC	N/A	Delaware

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ANNEXURE

UNDERTAKING SUBSIDIARIES

FORM OF ACCESSION AGREEMENT

By this Agreement [New Undertaking Subsidiary Name& ACN] ( Company Name ) of becomes:

• an Undertaking Subsidiary under the Sims Group Standard Terms dated ( Standard Terms ) with Westpac Banking Corporation ARBN 007 457 141 ( Westpac ) and others, and bound by them as stated in the Standard Terms;

• an [insert status] under the [insert name of Bank Document] dated ( insert short name of Bank Document ) with Westpac and others, and bound by the terms of the ( insert short name of Bank Document ) as stated in the ( insert short name of Bank Document ).

It does so in consideration of A$1 which it has received from Westpac and in consideration of Westpac at its request giving credit, or continuing to provide it or not taking immediate action to enforce the obligations of another Undertaking Company, and for other good and valuable consideration.

Capitalised terms used in this agreement are defined either within the text of this agreement or within the Standard Terms.

THE COMMON SEAL of ) [Company Name] ) was duly affixed in the presence of: )

Signature Print Name Office Held

Signature Print Name Office Held

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EX-4.18 c53813exv4w18.htm EX-4.18

Exhibit 4.18

CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO CERTAIN PORTIONS OF THIS AGREEMENT. CONFIDENTIAL PORTIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION.

AMENDED AND RESTATED CREDIT AGREEMENT Dated as of November 2, 2009 among SIMS GROUP USA HOLDINGS CORPORATION, and CERTAIN AFFILIATES as Borrowers, BANK OF AMERICA, N.A. as Lender

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TABLE OF CONTENTS

Section ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS 1.01 Defined Terms 1.02 Other Interpretive Provisions 1.03 Accounting Terms 1.04 Exchange Rates; Currency Equivalents 1.05 Additional Alternative Currencies 1.06 Change of Currency 1.07 Times of Day 1.08 Letter of Credit Amounts ARTICLE II. THE COMMITMENT AND CREDIT EXTENSIONS 2.01 Loans 2.02 Borrowings, Conversions and Continuations of Loans 2.03 Letters of Credit 2.04 Prepayments 2.05 Termination or Reduction of Commitment 2.06 Repayment of Loans 2.07 Interest 2.08 Fees 2.09 Computation of Interest and Fees 2.10 Evidence of Debt 2.11 Payments Generally 2.12 Designated Borrowers 2.13 Extension of Maturity Date ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY 3.01 Taxes 3.02 Illegality 3.03 Inability to Determine Rates 3.04 Increased Costs; Reserves on Eurocurrency Rate Loans 3.05 Compensation for Losses 3.06 Survival ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS 4.01 Conditions of Initial Credit Extension 4.02 Conditions to all Credit Extensions ARTICLE V. REPRESENTATIONS AND WARRANTIES 5.01 Existence, Qualification and Power 5.02 Authorization; No Contravention 5.03 Governmental Authorization; Other Consents 5.04 Binding Effect 5.05 Litigation 5.06 No Default 5.07 Ownership of Property; Liens 5.08 Environmental Compliance 5.09 ERISA Compliance 5.10 Subsidiaries; Equity Interests

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Section 5.11 Margin Regulations; Investment Company Act; Public Utility Holding Company Act 5.12 Disclosure 5.13 Compliance with Laws 5.14 Taxpayer Identification Number; Other Identifying Information 5.15 No Filing or Stamp Taxes 5.16 Taxation 5.17 Pari Passu 5.18 Governing Law and Enforcement 5.19 Not a Trustee 5.20 Commercial Benefit 5.21 Full Disclosure 5.22 Litigation 5.23 Representations True 5.24 Latest Audited Financial Statements; No Material Adverse Effect ARTICLE VI. AFFIRMATIVE COVENANTS 6.01 Information 6.02 Notices 6.03 Payment of Obligations 6.04 Preservation of Existence, Etc 6.05 Maintenance of Properties; Conduct of Business; Insurance 6.06 Compliance with Laws 6.07 Books and Records 6.08 Use of Proceeds 6.09 Most Favored Nations Status ARTICLE VII. NEGATIVE COVENANTS 7.01 Liens 7.02 Fundamental Changes 7.03 Dispositions 7.04 Change in Nature of Business 7.05 Finance Debt 7.06 Use of Proceeds 7.07 Negative Pledge 7.08 Swap Contracts ARTICLE VIII. CROSS-GUARANTY 8.01 Cross-Guaranty 8.02 Limitation of Liability 8.03 Liability of Borrowers Absolute 8.04 Waivers by Borrowers 8.05 Borrower’s Rights of Subrogation, Contribution, Etc 8.06 Continuing Guaranty; Reinstatement of Guaranty 8.07 Indemnity and Contribution 8.08 Liability Cumulative ARTICLE IX. EVENTS OF DEFAULT AND REMEDIES 9.01 Events of Default 9.02 Remedies Upon Event of Default 9.03 Application of Funds 9.04 Review Event ARTICLE X. MISCELLANEOUS

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Section 10.01 Amendments, Etc 10.02 Notices; Effectiveness; Electronic Communication 10.03 No Waiver; Cumulative Remedies 10.04 Expenses; Indemnity; Damage Waiver 10.05 Payments Set Aside 10.06 Successors and Assigns 10.07 Treatment of Certain Information; Confidentiality 10.08 Right of Setoff 10.09 Interest Rate Limitation 10.10 Counterparts; Integration; Effectiveness 10.11 Survival of Representations and Warranties 10.12 Severability 10.13 Governing Law; Jurisdiction; Etc 10.14 Waiver of Jury Trial 10.15 USA PATRIOT Act Notice 10.16 Time of the Essence 10.17 Judgment Currency 10.18 Amendment and Restatement

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SCHEDULES

1.01 Mandatory Cost Formulae 5.12 Subsidiaries; Other Equity Investments 10.02 Lender’s Office; Certain Addresses for Notices

EXHIBITS

Form of

A Loan Notice B Note C Guaranty D Designated Borrower Request and Assumption Agreement E Designated Borrower Notice

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AMENDED AND RESTATED CREDIT AGREEMENT

This AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”) is entered into as of November 2, 2009, among SIMS GROUP USA HOLDINGS CORPORATION, a Delaware corporation, formerly known as Sims Hugo Neu Corporation (the “Company”), SIMS GROUP GLOBAL TRADE CORPORATION, a Delaware corporation, successor by merger to Sims Hugo Neu Global Trade LLC (“Global Trade”), HNE RECYCLING LLC, a Delaware limited liability company (“HNE Recycling”), HNW RECYCLING LLC, a Delaware limited liability company (“HNW Recycling”), SIMSMETAL EAST LLC, a Delaware limited liability company, successor to Sims Hugo Neu East (General Partnership), a New York general partnership (“SHN East”), SIMSMETAL WEST LLC, a Delaware limited liability company, successor to Sims Hugo Neu West (General Partnership), a California general partnership (“SHN West”), SIMS GROUP USA CORPORATION, a Delaware corporation (“Sims USA”), METAL MANAGEMENT, INC., a Delaware corporation (“Metal Management”), MM METAL DYNAMICS HOLDINGS, INC., a Delaware corporation (“MM Dynamics”), METAL MANAGEMENT MIDWEST, INC., an Illinois corporation (“MM Midwest”), METAL MANAGEMENT OHIO, INC., an Ohio corporation (“MM Ohio”), SMM – NORTH AMERICA TRADE CORPORATION, a Delaware corporation, formerly known as Metal Management S&A Holdings, Inc. (“SMM — North America”), METAL MANAGEMENT WEST COAST HOLDINGS, INC., a Delaware corporation (“MM West Coast”), METAL MANAGEMENT PROLER SOUTHWEST, INC., a Delaware corporation (“MM Proler Southwest”), PROLER SOUTHWEST GP, INC., a Delaware corporation (“MM Southwest GP”), NAPORANO IRON & METAL, INC., a Delaware corporation (“Naporano”), METAL MANAGEMENT NORTHEAST, INC., a New Jersey corporation (“MM Northeast”), and METAL MANAGEMENT NEW HAVEN, INC., a Delaware corporation (“MM New Haven”), CIM TRUCKING, INC., an Illinois corporation (“CIM”), METAL MANAGEMENT ALABAMA, INC., a Delaware corporation (“MM Alabama”), METAL MANAGEMENT ARIZONA, L.L.C., an Arizona limited liability company (“MM Arizona”), METAL MANAGEMENT CONNECTICUT, INC., a Delaware corporation (“MM Connecticut”), METAL MANAGEMENT INDIANA, INC., an Illinois corporation (“MM Indiana”), METAL MANAGEMENT MEMPHIS, L.L.C., a Tennessee limited liability company (“MM Memphis”), METAL MANAGEMENT MISSISSIPPI, INC., a Delaware corporation (“MM Mississippi”), METAL MANAGEMENT PITTSBURGH, INC., a Delaware corporation (“MM Pittsburgh”), METAL MANAGEMENT WEST, INC., a Colorado corporation (“MM West”), NEW YORK RECYCLING VENTURES, INC., a Delaware corporation (“NY Recycling”), PROLER SOUTHWEST LP, a Texas limited partnership (“Proler Southwest”), RESERVE IRON & METAL LIMITED PARTNERSHIP, a Delaware limited partnership (“Reserve”), METAL DYNAMICS LLC, a Delaware limited liability company (“Metal Dynamics”), METAL DYNAMICS DETROIT LLC, a Delaware limited liability company (“MD Detroit”), METAL DYNAMICS INDIANAPOLIS LLC, a Delaware limited liability company (“MD Indianapolis”, and together with the Company, Global Trade, HNE Recycling, HNW Recycling, SHN East, SHN West, Sims USA, Metal Management, MM Dynamics, MM Midwest, MM Ohio, SMM - North America, MM West Coast, MM Proler Southwest, MM Southwest GP, Naporano, MM Northeast, MM New Haven, CIM, MM Alabama, MM Arizona, MM Connecticut, MM Indiana, MM Memphis, MM Mississippi, MM Pittsburgh, MM West, NY Recycling, Proler Southwest, Reserve, Metal Dynamics, MD Detroit and any additional Affiliates of the Company becoming a

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party hereto as provided in Section 2.12 hereof collectively, the “Designated Borrowers” and together with the Company, collectively, the “Borrowers” individually, a “Borrower”), and BANK OF AMERICA, N.A., a national banking association (the “Lender”).

A. The Borrowers and the Lender are parties to that certain Credit Agreement dated September 12, 2006 (as amended, supplemented or otherwise modified, the “Prior Credit Agreement”) pursuant to which the Lender has committed, subject to the terms and conditions therein set forth, to make Credit Extensions to the Borrowers.

B. The Borrowers have requested the Lender to make certain modifications to, and amend and restate in its entirety, the Prior Credit Agreement, which the Lender has agreed to do on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to amend and restate the Prior Credit Agreement as follows:

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS

1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings set forth below:

“Affiliate” means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“Agreement” means this Credit Agreement.

“Alternative Currency” means each of Euro, Sterling, Australian Dollars and each other currency (other than Dollars) that is approved in accordance with Section 1.05.

“Alternative Currency Equivalent” means, at any time, with respect to any amount denominated in Dollars, the equivalent amount thereof in the applicable Alternative Currency as determined by the Lender at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of such Alternative Currency with Dollars.

“Alternative Currency Reserve” means, at any time, the Dollar amount equal to 5% of the Outstanding Amount of Loans denominated in Alternative Currencies at such time.

“Applicable Margin” means the following percentages per annum, based upon the Cashflow Gearing Ratio as set forth in the most recent Compliance Certificate received by the Lender pursuant to Section 5.02(a) of the Guaranty:

Applicable Margin

PricingLevel [*]	Cashflow Gearing Ratio [*]	Commitment Fee [*]	Eurocurrency Rate Loans Standby Letters of Credit [*]	Base Rate Loans
				[*]

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Any increase or decrease in the Applicable Margin resulting from a change in the Cashflow Gearing Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 5.02(a) of the Guaranty; provided, however, that if a Compliance Certificate is not delivered when due in accordance with such Section, then the next higher Pricing Level shall apply from and after the date on which such Compliance Certificate was due and until the first day of the month following the Lender’s receipt of such Compliance Certificate.

“Applicable Time” means, with respect to any borrowings and payments in any Alternative Currency, the local time in the place of settlement for such Alternative Currency as may be determined by the Lender to be necessary for timely settlement on the relevant date in accordance with normal banking procedures in the place of payment.

“Applicant Borrower” has the meaning specified in Section 2.12.

“Approved Fund” means any Fund that is administered or managed by (a) the Lender, (b) an Affiliate of the Lender or (c) an entity or an Affiliate of an entity that administers or manages the Lender.

“Attributable Indebtedness” means, on any date, (a) in respect of any capitalized lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capitalized lease.

“Australian Dollar” and “AU$” mean lawful money of Australia.

“Availability Period” means the period from and including the Closing Date to the earlier of (a) the Maturity Date and (b) the date of termination of the Commitment.

“Base Rate” means for any day a fluctuating rate per annum equal to the [*] .

“Base Rate Loan” means a Loan that bears interest based on the Base Rate. All Base Rate Loans shall be denominated in Dollars.

“Borrower” and “Borrowers” each has the meaning specified in the introductory paragraph hereto.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Lending Office with respect to Obligations denominated in Dollars is located and:

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(a) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Dollars, any fundings, disbursements, settlements and payments in Dollars in respect of any such Eurocurrency Rate Loan, or any other dealings in Dollars to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day on which dealings in deposits in Dollars are conducted by and between banks in the London interbank eurodollar market;

(b) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Euro, any fundings, disbursements, settlements and payments in Euro in respect of any such Eurocurrency Rate Loan, or any other dealings in Euro to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means a TARGET Day;

(c) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro, means any such day on which dealings in deposits in the relevant currency are conducted by and between banks in the London or other applicable offshore interbank market for such currency; and

(d) if such day relates to any fundings, disbursements, settlements and payments in a currency other than Dollars or Euro in respect of a Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro, or any other dealings in any currency other than Dollars or Euro to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan (other than any interest rate settings), means any such day on which banks are open for foreign exchange business in the principal financial center of the country of such currency.

“Cash Collateralize” has the meaning specified in Section 2.03(f).

“Cashflow Gearing Ratio” means the ratio specified in Section 5.10(b) of the Guaranty.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

“Change of Control” means an event or series of events by which:

(a) the Parent shall cease to have possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of each Borrower through the ability to exercise voting power of the equity securities of each such Borrower; or

(b) any Person shall have acquired a “relevant interest” (as such term is defined in the Corporations Law of Australia) in more than fifty percent (50%) of the equity securities of the Parent entitled to vote for members of the board of directors of the Parent.

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“Closing Date” means the first date all the conditions precedent in Section 4.01 are satisfied or waived by the Lender.

“Code” means the Internal Revenue Code of 1986.

“Commitment” means the obligation of the Lender to make Loans and L/C Credit Extensions hereunder in an aggregate principal amount at any one time not to exceed the amount of $150,000,000, as such amount may be adjusted from time to time in accordance with this Agreement.

“Company” has the meaning specified in the introductory paragraph hereto.

“Compliance Certificate” means a certificate substantially in the form of Exhibit A attached to the Guaranty.

“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Corporations Act” means the Corporations Act 2001 (Cth) of Australia.

“Credit Extension” means each of the following: (a) a borrowing of a Loan and (b) an L/C Credit Extension.

“Debtor Relief Laws” means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

“Default Rate” means (a) when used with respect to Obligations other than Letter of Credit Fees, an interest rate equal to (i) the Prime Rate plus (ii) the Applicable Margin applicable to Base Rate Loans plus (iii) [*] per annum; provided, however, that with respect to a Eurocurrency Rate Loan, the Default Rate shall be an interest rate equal to the interest rate (including any Applicable Margin and any Mandatory Cost) otherwise applicable to such Loan plus [*] per annum, and (b) when used with respect to Letter of Credit Fees, a rate equal to the Applicable Margin applicable to standby Letters of Credit plus [*] per annum.

“Designated Borrower” has the meaning specified in the introductory paragraph hereto.

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“Designated Borrower Notice” has the meaning specified in Section 2.12.

“Designated Borrower Request and Assumption Agreement” has the meaning specified in Section 2.12.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

“Dollar” and “$” mean lawful money of the United States.

“Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in any Alternative Currency, the equivalent amount thereof in Dollars as determined by the Lender at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of Dollars with such Alternative Currency.

“Domestic Affiliate” means any wholly-owned Subsidiary of the Parent that is organized under the laws of any political subdivision of the United States.

“Eligible Assignee” means (a) an Affiliate of the Lender; (b) an Approved Fund; and (c) any other Person (other than a natural person) approved by the Borrower (such approval not to be unreasonably withheld or delayed); provided that no such approval shall be required if an Event of Default has occurred and is continuing.

“EMU” means the economic and monetary union in accordance with the Treaty of Rome 1957, as amended by the Single European Act 1986, the Maastricht Treaty of 1992 and the Amsterdam Treaty of 1998.

“EMU Legislation” means the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified European currency.

“Environmental Laws” means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Company, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

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“Equity Interests” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Company within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001(a) (2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by the Company or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the Company or any ERISA Affiliate.

“Euro” and “EUR” mean the lawful currency of the Participating Member States introduced in accordance with the EMU Legislation.

“Eurocurrency Fixed Rate” means, for any Interest Period with respect to a Eurocurrency Rate Loan, the rate per annum equal to (i) the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Lender from time to time) at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period, for deposits in the relevant currency (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (ii) if such published rate is not available at such time for any reason, then the “Eurocurrency Rate” for such Interest Period shall be the rate per annum determined by the Lender to be the rate at which deposits in the relevant currency for delivery on the first day of such Interest Period in Same Day Funds in the approximate amount of the Eurocurrency Rate Loan being made, continued or converted by the Lender and with a term equivalent to such Interest Period would be offered by the Lender’s London Branch (or other branch or Affiliate of the Lender) to major banks in the London or other offshore interbank

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market for such currency at their request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period.

“Eurocurrency Fixed Rate Loan” means a Loan that bears interest at a rate based on the Eurocurrency Fixed Rate.

“Eurocurrency Floating Rate” means, for any day, the rate per annum equal to (i) the British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Lender from time to time) at approximately 11:00 a.m. (London time) two Business Days prior to such day for deposits in the relevant currency (for delivery on such day) with a term equivalent to one month or (ii) if such published rate is not available at such time for any reason, then the “Eurocurrency Rate” shall be the rate per annum determined by the Lender to be the rate at which deposits in the relevant currency for delivery on such day in Same Day Funds in the approximate amount of the Base Rate Loan being made, continued or converted by the Lender and with a term equivalent to one month would be offered by the Lender’s London Branch (or other branch or Affiliate of the Lender) to major banks in the London or other offshore interbank market for such currency at their request at approximately 11:00 a.m. (London time) two Business Days prior to such day.

“Eurocurrency Floating Rate Loan” means a Loan that bears interest at a rate based on the Eurocurrency Floating Rate.

“Eurocurrency Rate” means (i) with respect to a Eurocurrency Floating Rate Loan or Base Rate Loan, the Eurocurrency Floating Rate and (ii) with respect to a Eurocurrency Fixed Rate Loan, the Eurocurrency Fixed Rate.

“Eurocurrency Rate Loan” means a Loan that bears interest at a rate based on the Eurocurrency Rate. Eurocurrency Rate Loans may be denominated in Dollars or in an Alternative Currency. All Loans denominated in an Alternative Currency must be Eurocurrency Rate Loans.

“Eurocurrency Unavailability Period” means any period during which the obligation of the Lenders to make or maintain Eurocurrency Rate Loans has been suspended pursuant to Section 3.02 or Section 3.03.

“Event of Default” has the meaning specified in Section 9.01.

“Excluded Taxes” means, with respect to the Lender or any other recipient of any payment to be made by or on account of any obligation of any Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of the Lender, in which its applicable Lending Office is located and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which such Borrower is located.

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“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to the Lender on such day on such transactions as determined by the Lender.

“Finance Debt” means, as to any Person, all indebtedness, present or future, actual or contingent, of such Person in relation to money borrowed or raised or any other financing, including, without limitation, any and all such indebtedness under or in respect of any of the following:

• (a) a Guarantee;

(b) a discounting arrangement, a finance lease or similar agreement, hire purchase, deferred purchase price (for more than 90 days);

• (c) a Swap Contract (the amount of such Finance Debt being the marked to market value of the relevant transaction); and

• (d) an obligation to deliver property or provide services paid for in advance by a financier.

“FRB” means the Board of Governors of the Federal Reserve System of the United States.

“Fund” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“GAAP” means generally accepted accounting standards in Australia, consistently applied.

“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” means, as to any Person, any (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or

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indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“Guaranty” means the Continuing Guaranty made by the Parent in favor of the Lender, substantially in the form of Exhibit C.

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Honor Date” has the meaning specified in Section 2.03(c)(i).

“Indebtedness” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

(c) net obligations of such Person under any Swap Contract;

(d) all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business and, in each case, not past due for more than 60 days after the date on which such trade account payable was created);

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(e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(f) capitalized leases and Synthetic Lease Obligations;

(g) all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends; and

(h) all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any capitalized lease or Synthetic Lease Obligation as of any date shall be deemed to be the amount of Attributable Indebtedness in respect thereof as of such date.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Indemnitees” has the meaning specified in Section 10.04(b).

“Information” has the meaning specified in Section 10.07.

“Intangible Assets” means assets that are considered to be intangible assets under GAAP, including customer lists, goodwill, computer software, copyrights, trade names, trademarks, patents, franchises, licenses, unamortized deferred charges, unamortized debt discount and capitalized research and development costs.

“Interest Payment Date” means, (a) as to any Loan other than a Eurocurrency Floating Rate Loan or a Base Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurocurrency Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Eurocurrency Floating Rate Loan or Base Rate Loan, the last Business Day of each March, June, September and December and the Maturity Date.

“Interest Period” means, as to each Eurocurrency Fixed Rate Loan, the period commencing on the date such Eurocurrency Fixed Rate Loan is disbursed or converted to or continued as a Eurocurrency Fixed Rate Loan [*] , as selected by the Company in its Loan Notice; provided that:

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(i) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(ii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(iii) no Interest Period shall extend beyond the Maturity Date.

“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor Guarantees Indebtedness of such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment.

“IRS” means the United States Internal Revenue Service.

“ISP” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance).

“Issuer Documents” means with respect to any Letter of Credit, the Letter of Credit Application, and any other document, agreement and instrument entered into by the Lender and the Company (or any Subsidiary) or in favor the Lender and relating to such Letter of Credit.

“Laws” means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

“L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the renewal or increase of the amount thereof.

“L/C Obligations” means, as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all Unreimbursed Amounts. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.08.

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For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“Lending Office” means the office or offices of the Lender described as such on Schedule 10.02, or such other office or offices as the Lender may from time to time notify the Borrower.

“Letter of Credit” means any letter of credit issued hereunder. A Letter of Credit may be a commercial letter of credit or a standby letter of credit. Letters of Credit may be issued in Dollars or in an Alternative Currency.

“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by the Lender.

“Letter of Credit Expiration Date” means the day that is seven days prior to the Maturity Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).

“Letter of Credit Fee” has the meaning specified in Section 2.03(h).

“Letter of Credit Sublimit” means an amount equal to the amount of the Commitment. The Letter of Credit Sublimit is part of, and not in addition to, the Commitment.

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

“Loan” has the meaning specified in Section 2.01.

“Loan Documents” means this Agreement, each Designated Borrower Request and Assumption Agreement, each Note, each Issuer Document and the Guaranty.

“Loan Notice” means a notice of (a) a borrowing of a Loan, (b) a conversion of a Loan from one Type to the other, or (c) a continuation of a Eurocurrency Fixed Rate Loan as the same Type, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

“Loan Parties” means, collectively, the Company, each Designated Borrower and the Parent.

“Mandatory Cost” means, with respect to any period, the percentage rate per annum determined in accordance with Schedule 1.01.

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“Material Adverse Effect” means (a) a material adverse effect upon financial condition of the Parent and its Subsidiaries taken as a whole; (b) a material impairment of the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against any Loan Party of any Loan Document to which it is a party.

“Material Credit Agreements” means (a) that certain Variation to Standard Terms (with attached amended Standard Terms) dated on or about November 2, 2009, as amended, among the Parent and certain of its Subsidiaries and Westpac Banking Corporation, (b) that certain Amendment and Restatement Deed (with attached amended and restated Multi Option Facility Agreement) dated on or about November 2, 2009, as amended, among the Parent and certain of its Subsidiaries and HSBC Bank Australia Limited, HSBC Bank Plc and HSBC Bank USA National Association, (c) that certain Multi Option Facility Agreement and Common Terms Deed dated on or about November 2, 2009, as amended, among the Parent and certain of its Subsidiaries and Commonwealth Bank of Australia, (d) that certain Variation to Standard Terms (with attached amended Standard Terms) dated on or about November 2, 2009, as amended, among the Parent and certain of its Subsidiaries and National Australia Bank Limited, and (d) any replacement or successor agreements to any of the foregoing or any substantially similar loan or credit agreements with other banks or lenders pursuant to which such banks or lenders have agreed to extend credit to the Parent or its Subsidiaries.

“Maturity Date” means December 1, 2010; provided, however, that if such date is not a Business Day, the Maturity Date shall be the next preceding Business Day.

“Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which the Company or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

“Note” means a promissory note made by a Borrower in favor of the Lender evidencing Loans made by the Lender to such Borrower, substantially in the form of Exhibit B.

“Obligations” means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding.

“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement,

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instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“Outstanding Amount” means (i) with respect to Loans on any date, the Dollar Equivalent amount of the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of Loans occurring on such date; and (ii) with respect to any L/C Obligations on any date, the Dollar Equivalent amount of the aggregate outstanding amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by the Company of Unreimbursed Amounts.

“Parent” means Sims Metal Management Limited, a corporation incorporated in the State of Victoria, Commonwealth of Australia.

“Participant” has the meaning specified in Section 10.06(c).

“Participating Member State” means each state so described in any EMU Legislation.

“PBGC” means the Pension Benefit Guaranty Corporation.

“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by the Company or any ERISA Affiliate or to which the Company or any ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple employer or other plan described in Section 4064 (a) of ERISA, has made contributions at any time during the immediately preceding five plan years.

“Permitted Finance Debt” means any Finance Debt provided by a Loan Party:

• (a) under the Loan Documents;

• (b) to another Loan Party;

(c) in the form of deposits held with financial institutions in the ordinary course of business and supplier advances for which security adequate to cover the amount of the supplier advance is taken; or

(d) to Persons other than other Loan Parties which when added to all such other outstanding Finance Debt provided by all Relevant Companies does not exceed AU$35,000,000.

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“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any “employee benefit plan” (as such term is defined in Section 3(3) of ERISA) established by the Company or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate.

“Prime Rate” means for any day a fluctuating rate per annum equal to the rate of interest in effect for such day as publicly announced from time to time by the Lender as its “prime rate.” The “prime rate” is a rate set by the Lender based upon various factors including the Lender’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such rate announced by the Lender shall take effect at the opening of business on the day specified in the public announcement of such change.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

“Relevant Company” means any Loan Party and any Subsidiary of any of them.

“Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day notice period has been waived.

“Request for Credit Extension” means (a) with respect to a borrowing, conversion or continuation of a Loan, a Loan Notice, and (b) with respect to an L/C Credit Extension, a Letter of Credit Application.

“Responsible Officer” means the chief executive officer, president, chief financial officer, treasurer, assistant treasurer or controller of a Loan Party and, solely for purposes of notices given pursuant to Article II, any other officer or employee of the applicable Loan Party so designated by any of the foregoing officers in a notice to the Lender. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan Party.

“Revaluation Date” means (a) with respect to any Loan, each of the following: (i) each date of a borrowing of a Eurocurrency Rate Loan denominated in an Alternative Currency, (ii) each date of a continuation of a Eurocurrency Rate Loan denominated in an Alternative Currency pursuant to Section 2.02, and (iii) such additional dates as the Lender may reasonably require; and (b) with respect to any Letter of Credit, each of the following: (i) each date of issuance of a Letter of Credit denominated in an Alternative Currency, (ii) each date of an amendment of any such Letter of Credit having the effect of increasing the amount thereof (solely with respect to the increased amount), (iii) each date of any payment by the Lender under any Letter of Credit denominated in an Alternative Currency, and (iv) such additional dates as the Lender may reasonably require.

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“Same Day Funds” means (a) with respect to disbursements and payments in Dollars, immediately available funds, and (b) with respect to disbursements and payments in an Alternative Currency, same day or other funds as may be determined by the Lender to be customary in the place of disbursement or payment for the settlement of international banking transactions in the relevant Alternative Currency.

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“Sims Group” means the Parent and its Subsidiaries.

“Special Notice Currency” means at any time an Alternative Currency, other than the currency of a country that is a member of the Organization for Economic Cooperation and Development at such time located in North America or Europe.

“Spot Rate” for a currency means:

(a) in the case of any Loan denominated in an Alternative Currency, the Spot Rate shall be the daily 10 am spot rate published by the New York Federal Reserve Bank at its website, http://www.ny.frb.org/markets/fxrates/tenAm.cfm for such currency on the date that is two Business Days prior to the date as of which the foreign exchange computation is made. The daily 10 am spot rates are midpoints of buying rates and selling rates, and do not necessarily reflect rates at which actual transactions have occurred. In the event that such rate does not appear on such website or such website is no longer published, the Spot Rate for a currency in the case of any Loan denominated in an Alternative Currency shall be the rate determined by the Lender to be the rate quoted by the Lender as the spot rate for the purchase by the Lender of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to the date as of which the foreign exchange computation is made; provided that the Lender may obtain such spot rate from another financial institution designated by the Lender if the Lender does not have as of the date of determination a spot buying rate for any such currency; and

(b) in the case of any Letter of Credit denominated in an Alternative Currency and for all other purposes under this Agreement not described in clause (a) above, the Spot Rate shall be the rate determined by the Lender to be the rate quoted by the Lender as the spot rate for the purchase by the Lender of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date as of which the foreign exchange computation is made; provided that the Lender may obtain such spot rate from another financial institution designated by the Lender if the Lender does not have as of the date of determination a spot buying rate for any such currency; and provided further that the Lender may use such spot rate quoted on the date two Business Days prior to the date as of which the foreign exchange computation is made in all cases other than a Letter of Credit denominated in an Alternative Currency.

“Sterling” and “£” mean the lawful currency of the United Kingdom.

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“Subsidiary” of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise specified, all references herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or Subsidiaries of the Company.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more midmarket or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include the Lender or any Affiliate of the Lender).

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment).

“TARGET Day” means any day on which the Trans-European Automated Real-time Gross Settlement Express Transfer (TARGET) payment system (or, if such payment system ceases to be operative, such other payment system (if any) determined by the Lender to be a suitable replacement) is open for the settlement of payments in Euro.

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“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Threshold Amount” means AU$10,000,000.

“Total Outstandings” means the sum of (i) the aggregate Outstanding Amount of all Loans and (ii) the aggregate Outstanding Amount of all L/C Obligations

“Type” means, with respect to a Loan, its character as a Base Rate Loan, a Eurocurrency Floating Rate Loan or a Eurocurrency Fixed Rate Loan.

“Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

“United States” and “U.S.” mean the United States of America.

“Unreimbursed Amount” has the meaning specified in Section 2.03(c)(i).

“Yen” and “¥” mean the lawful currency of Japan.

1.02 Other Interpretive Provisions. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “herein,” “hereof” and “hereunder,” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

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(b) In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

(c) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

1.03 Accounting Terms.

(a) Generally. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the financial statements of the Parent for the fiscal period ended June 30, 2009, except as otherwise specifically prescribed herein.

(b) Changes in GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Company or the Lender shall so request, the Lender and the Company shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Lender); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Company shall provide to the Lender financial statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

1.04 Exchange Rates; Currency Equivalents.

(a) As of each Revaluation Date, the Spot Rates shall be used for calculating Dollar Equivalent amounts of Credit Extensions and Outstanding Amounts denominated in Alternative Currencies. Such Spot Rates shall become effective as of such Revaluation Date and shall be the Spot Rates employed in converting any amounts between the applicable currencies until the next Revaluation Date to occur. Except for purposes of financial statements delivered by Loan Parties hereunder or calculating financial covenants hereunder or except as otherwise provided herein, the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent amount as so determined by the Lender.

(b) Wherever in this Agreement in connection with a borrowing, conversion, continuation or prepayment of a Eurocurrency Rate Loan or the issuance, amendment or extension of a Letter of Credit, an amount, such as a required minimum or multiple amount, is expressed in Dollars, but such borrowing, Eurocurrency Rate Loan or Letter of Credit is denominated in an Alternative Currency, such amount shall be the relevant Alternative Currency Equivalent of such Dollar amount (rounded to the nearest unit of such Alternative Currency, with 0.5 of a unit being rounded upward), as determined by the Lender in its sole discretion

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(c) Wherever in this Agreement in connection with the determination any Loan Party’s performance or observance any covenant contained in this Agreement on its part to be performed or observed, an amount, such as a required minimum amount, is expressed in Australian Dollars, but the amounts to be determined are denominated in currencies other than Australian Dollars, the equivalent amount in Australian Dollars shall, subject to Section 7.05 of the Guaranty, be determined by the Lender.

1.05 Additional Alternative Currencies.

(a) The Company may from time to time request that Eurocurrency Rate Loans be made and/or Letters of Credit be issued in a currency other than those specifically listed in the definition of “Alternative Currency;” provided that such requested currency is a lawful currency (other than Dollars) that is readily available and freely transferable and convertible into Dollars. In the case of any such request with respect to the making of Eurocurrency Rate Loans, such request shall be subject to the approval of the Lender.

(b) Any such request shall be made to the Lender not later than 11:00 a.m., [*] prior to the date of the desired Credit Extension (or such other time or date as may be agreed by the Lender, in its sole discretion).

(c) If the Lender consents to making Eurocurrency Rate Loans in such requested currency, the Lender shall so notify the Company and such currency shall thereupon be deemed for all purposes to be an Alternative Currency hereunder for purposes of any borrowings of Eurocurrency Rate Loans as provided in Section 2.02 and for purposes of any Letter of Credit issuances as provided in Section 2.03.

1.06 Change of Currency.

(a) Each obligation of the Borrowers to make a payment denominated in the national currency unit of any member state of the European Union that adopts the Euro as its lawful currency after the date hereof shall be redenominated into Euro at the time of such adoption (in accordance with the EMU Legislation). If, in relation to the currency of any such member state, the basis of accrual of interest expressed in this Agreement in respect of that currency shall be inconsistent with any convention or practice in the London interbank market for the basis of accrual of interest in respect of the Euro, such expressed basis shall be replaced by such convention or practice with effect from the date on which such member state adopts the Euro as its lawful currency; provided that if any borrowing of Loans in the currency of such member state is outstanding immediately prior to such date, such replacement shall take effect, with respect to such borrowing, at the end of the then current Interest Period.

(b) Each provision of this Agreement shall be subject to such reasonable changes of construction as the Lender may from time to time specify to be appropriate to reflect the adoption of the Euro by any member state of the European Union and any relevant market conventions or practices relating to the Euro.

(c) Each provision of this Agreement also shall be subject to such reasonable changes of construction as the Lender may from time to time specify to be appropriate to reflect a change

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in currency of any other country and any relevant market conventions or practices relating to the change in currency.

1.07 Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Pacific time (daylight or standard, as applicable).

1.08 Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the Dollar Equivalent of the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the Dollar Equivalent of the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

ARTICLE II.

THE COMMITMENT AND CREDIT EXTENSIONS

2.01 Loans. Subject to the terms and conditions set forth herein, the Lender agrees to make loans (each such loan, a “Loan”) to the Borrowers in Dollars or in one or more Alternative Currencies from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of the Commitment; provided, however, that after giving effect to any borrowing, the Total Outstandings shall not exceed the amount of the Commitment; and provided further that the availability of the Commitment at any time for the making of Loans and the issuance of Letters of Credit shall be reduced by the amount of the Alternative Currency Reserve (if any). Within the limits of the Commitment, and subject to the other terms and conditions hereof, the Borrowers may borrow under this Section 2.01, prepay under Section 2.04, and reborrow under this Section 2.01. Loans may be Base Rate Loans, Eurocurrency Floating Rate Loans or Eurocurrency Fixed Rate Loans, as further provided herein.

2.02 Borrowings, Conversions and Continuations of Loans.

(a) Each borrowing, each conversion of a Loan from one Type to the other, and each continuation of a Eurocurrency Fixed Rate Loan shall be made upon the Company’s irrevocable notice to the Lender, which may be given by telephone. Each such notice must be received by the Lender not later than (i) [*] the requested date of any borrowing of, conversion to or continuation of Eurocurrency Fixed Rate Loans denominated in Dollars or of any conversion of Eurocurrency Fixed Rate Loans denominated in Dollars to Eurocurrency Floating Rate Loans or Base Rate Loans, (ii) [*] the requested date of any borrowing or continuation of Eurocurrency Fixed Rate Loans denominated in Alternative Currencies, and (iii) [*] the requested date of any borrowing of Eurocurrency Floating Rate Loans or Base Rate Loans. Each telephonic notice by the Company pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Lender of a written Loan Notice, appropriately completed and signed by a Responsible Officer of the Company. Each borrowing of, conversion to or continuation of Eurocurrency Fixed Rate Loans shall be [*] . Except as provided in Section 2.03(c), each borrowing of or conversion to Eurocurrency Floating Rate Loans or Base Rate Loans shall be [*] . Each Loan Notice (whether

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telephonic or written) shall specify (i) whether the Company is requesting a borrowing, a conversion of Loans from one Type to the other, or a continuation of Eurocurrency Fixed Rate Loans, (ii) the requested date of the borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Loans to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or to which existing Loans are to be converted, (v) if applicable, the duration of the Interest Period with respect thereto, (vi) the currency of the Loans to be borrowed, and (vii) if applicable, the Designated Borrower. If the Company fails to specify a currency in a Loan Notice requesting a borrowing, then the Loans so requested shall be made in Dollars. If the Company fails to specify a Type of Loan in a Loan Notice or if the Company fails to give a timely notice requesting a conversion or continuation, then the applicable Loans shall be made as, or converted to, Base Rate Loans; provided, however, that in the case of a failure to request on a timely basis a continuation of Loans denominated in an Alternative Currency, such Loans shall be continued as Eurocurrency Floating Rate Loans in their original currency. Any automatic conversion to Eurocurrency Floating Rate Loans or Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurocurrency Fixed Rate Loans. [*] .

(b) Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if such borrowing is the initial Credit Extension, Section 4.01), the Lender shall make the proceeds of each Loan available to the Company or the other applicable Borrower either by (i) crediting the account of such Borrower on the books of the Lender with the amount of such proceeds or (ii) wire transfer of such proceeds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Lender by the Company; provided, however, that if, on the date the Loan Notice with respect to such borrowing denominated in Dollars is given by the Company, there are Unreimbursed Amounts outstanding then the proceeds of such borrowing, first, shall be applied to the payment in full of any such Unreimbursed Amounts, and, second, shall be made available to the applicable Borrower as provided above.

(c) Except as otherwise provided herein, a Eurocurrency Fixed Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurocurrency Fixed Rate Loan. During the existence of a Default, no Loan may be requested as, converted to or continued as Eurocurrency Fixed Rate Loans (whether in Dollars or any Alternative Currency) without the consent of the Lender, and the Lender may demand that any or all of the then outstanding Eurocurrency Fixed Rate Loans denominated in an Alternative Currency be prepaid, or redenominated into Dollars in the amount of the Dollar Equivalent thereof, on the last day of the then current Interest Period with respect thereto.

(d) The Lender shall promptly notify the Company of the interest rate applicable to any Interest Period for a Eurocurrency Fixed Rate Loan upon determination of such interest rate. On the first Business Day of each week following a week during which a Eurocurrency Floating Rate Loan is outstanding, the Lender shall notify the Company of the Eurocurrency Floating Rate applicable to such Loan(s) during the preceding week; provided, however, that the Lender shall incur no liability for failing to provide the Company with such notice. Upon request of the Company, the Lender shall notify the Borrower of the then current Eurocurrency Floating Rate. At any time that a Base Rate Loan is outstanding, the Lender shall notify the Borrower of any change in the Lender’s prime rate used in determining the Prime Rate promptly following the public announcement of such change.

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(e) After giving effect to all borrowings, all conversions of Loans from one Type to the other, and all continuations of Loans as the same Type, there shall not be more than ten Interest Periods in effect.

2.03 Letters of Credit.

(a) The Letter of Credit Commitment.

(i) Subject to the terms and conditions set forth herein, the Lender agrees (A) from time to time on any Business Day during the period from the Closing Date until the Letter of Credit Expiration Date, to issue Letters of Credit denominated in Dollars or in one or more Alternative Currencies for the account of the Company or any Designated Borrower, and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (B) to honor drawings under the Letters of Credit; provided that the Lender shall not be obligated to make any L/C Credit Extension with respect to any Letter of Credit if as of the date of such L/C Credit Extension, (x) the Total Outstandings would exceed the amount of the Commitment, and (y) the Outstanding Amount of the L/C Obligations would exceed the Letter of Credit Sublimit; and provided further that the availability of the Commitment at any time for the making of Loans and the issuance of Letters of Credit shall be reduced by the amount of the Alternative Currency Reserve (if any). Each request by the Company for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Company that the L/C Credit Extension so requested complies with the conditions set forth in the provisos to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, the Company’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Company may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

(ii) The Lender shall be under no obligation to issue any Letter of Credit if:

(A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Lender from issuing such Letter of Credit, or any Law applicable to the Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Lender shall prohibit, or request that the Lender refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the Lender with respect to such Letter of Credit any restriction, reserve or capital requirement (for which the Lender is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Lender any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the Lender in good faith deems material to it;

(B) the issuance of such Letter of Credit would violate one or more policies of the Lender applicable to letters of credit generally;

(C) except as otherwise agreed by the Lender, such Letter of Credit is in an initial stated amount [*] ;

(D) except as otherwise agreed by the Lender, such Letter of Credit is to be denominated in a currency other than Dollars or an Alternative Currency;

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(E) the Lender does not as of the issuance date of such requested Letter of Credit issue Letters of Credit in the requested currency; or

(F) such Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder.

(iii) The Lender shall not amend any Letter of Credit if the Lender would not be permitted at such time to issue such Letter of Credit in its amended form under the terms hereof.

(iv) The Lender shall be under no obligation to amend any Letter of Credit if (A) the Lender would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(b) Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit.

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Company delivered to the Lender in the form of a Letter of Credit Application, appropriately completed and signed by a Responsible Officer of the Company. Such Letter of Credit Application must be received by the Lender not later than [*] prior to the proposed issuance date or date of amendment, as the case may be. In the case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the Lender: [*] . In the case of a request for an amendment of any outstanding Letter of Credit, such Letter of Credit Application shall specify in form and detail satisfactory to the Lender [*] .

(ii) Upon the Lender’s determination that the requested issuance or amendment is permitted in accordance with the terms hereof, then, subject to the terms and conditions hereof, the Lender shall, on the requested date, issue a Letter of Credit for the account of the Company (or the applicable Designated Borrower) or enter into the applicable amendment, as the case may be, in each case in accordance with the Lender’s usual and customary business practices.

(iii) If the Company so requests in any applicable Letter of Credit Application, the Lender may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such AutoExtension Letter of Credit must permit the Lender to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the Lender, the Company shall not be required to make a specific request to the Lender for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lender shall, subject to the terms and conditions set forth herein, permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that the Lender shall have no obligation to permit any such extension if the

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Lender has determined that it would have no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of clause (ii) or (iii) of Section 2.03(a) or otherwise)

(iv) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the Lender will also deliver to the Company a true and complete copy of such Letter of Credit or amendment.

(c) Drawings and Reimbursements.

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the Lender shall notify the Company thereof. In the case of a Letter of Credit denominated in an Alternative Currency, the Company shall reimburse the Lender in [*] . In the case of any such reimbursement in Dollars of a drawing under a Letter of Credit denominated in an Alternative Currency, the Lender shall notify the Company of the Dollar Equivalent of the amount of the drawing promptly following the determination thereof. Not later than [*] (each such date, an “Honor Date”), the Company shall reimburse the Lender in an amount equal to the amount of such drawing and in the applicable currency. If the Company fails to so reimburse the Lender by such time, the Company shall be deemed to have requested a borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount equal to the amount of the unreimbursed drawing [*] (the “Unreimbursed Amount”), without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base Rate Loans, but subject to the amount of the unutilized portion of the Commitment and the conditions set forth in Section 4.02 (other than the delivery of a Loan Notice).

(ii) If the Company fails to reimburse the Lender for any drawing under any Letter of Credit (whether by means of a borrowing or otherwise), such unreimbursed amount shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate.

(d) Obligations Absolute. The obligation of the Company to reimburse the Lender for each drawing under each Letter of Credit shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following:

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document;

(ii) the existence of any claim, counterclaim, setoff, defense or other right that the Company or any Designated Borrower may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the Lender or any other Person, whether in connection with this Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction;

(iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any

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statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(iv) any payment by the Lender under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the Lender under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law;

(v) any adverse change in the relevant exchange rates or in the availability of the relevant Alternative Currency to the Company or any Designated Borrower or in the relevant currency markets generally; or

(vi) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Company or any Designated Borrower.

The Company shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Company’s instructions or other irregularity, the Company will immediately notify the Lender. The Company shall be conclusively deemed to have waived any such claim against the Lender and its correspondents unless such notice is given as aforesaid.

(e) Role of Lender. The Company agrees that, in paying any drawing under a Letter of Credit, the Lender shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. The Company hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Company’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. None of the Lender, any of its Related Parties nor any correspondent, participant or assignee of the Lender shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.03(c) (ii); provided, however, that anything in such clauses to the contrary notwithstanding, the Company may have a claim against the Lender, and the Lender may be liable to the Company, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Company which the Company proves were caused by the Lender’s willful misconduct or gross negligence or the Lender’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, the Lender may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the Lender shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or

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purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

(f) Cash Collateral.

(i) Upon the request of the Lender, (A) if the Lender has honored any full or partial drawing request under any Letter of Credit and such drawing has not been reimbursed on the applicable Honor Date, or (B) if, as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Company shall, in each case, immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations.

(ii) In addition, if the Lender notifies the Company at any time that the Outstanding Amount of all L/C Obligations at such time exceeds [*] of the Letter of Credit Sublimit then in effect, then, within [*] after receipt of such notice, the Company shall Cash Collateralize the L/C Obligations in an amount equal to the amount by which the Outstanding Amount of all L/C Obligations exceeds the Letter of Credit Sublimit.

(iii) The Lender may, at any time and from time to time after the initial deposit of Cash Collateral required in this Agreement, request that additional Cash Collateral be provided in order to protect against the results of exchange rate fluctuations.

(iv) Sections 2.04 and 9.02(a)(iii) set forth certain additional requirements to deliver Cash Collateral hereunder. For purposes of this Section 2.03, Section 2.04 and Section 9.02(a)(iii), “Cash Collateralize” means to pledge and deposit with or deliver to the Lender, as collateral for the L/C Obligations, cash or deposit account balances pursuant to documentation in form and substance satisfactory to the Lender. Derivatives of such term have corresponding meanings. The Company hereby grants to the Lender a security interest in all such cash, deposit accounts and all balances therein and all proceeds of the foregoing. Cash Collateral shall be maintained in blocked, non-interest bearing deposit accounts at the Lender.

(g) Applicability of ISP and UCP. Unless otherwise expressly agreed by the Lender and the Company when a Letter of Credit is issued, (i) the rules of the ISP shall apply to each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary Credits (UCP), as most recently published by the International Chamber of Commerce at the time of issuance shall apply to each commercial Letter of Credit.

(h) Letter of Credit Fees. The Company shall pay to the Lender, in Dollars, a Letter of Credit fee (the “Letter of Credit Fee”) (i) for each commercial Letter of Credit equal to [*] per annum times the Dollar Equivalent of the daily amount available to be drawn under such Letter of Credit, and (ii) for each standby Letter of Credit equal to [*] . For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.08. Letter of Credit Fees shall be (i) due and payable on [*] after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears. If there is any change in the Applicable Margin during any quarter, the daily amount available to be drawn under each standby

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Letter of Credit shall be computed and multiplied by the Applicable Margin separately for each period during such quarter that such Applicable Margin was in effect. Notwithstanding anything to the contrary contained herein, upon the request of the Lender, while any Event of Default exists, all Letter of Credit Fees shall accrue at the Default Rate.

(i) Documentary and Processing Charges Payable to Lender. The Company shall pay to the Lender, in Dollars, the customary issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the Lender relating to letters of credit as from time to time in effect. Such customary fees and standard costs and charges are due and payable on demand and are nonrefundable.

(j) Conflict with Issuer Documents. In the event of any conflict between the terms hereof and the terms of any Issuer Document, the terms hereof shall control.

(k) Letters of Credit Issued for Designated Borrowers. Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Designated Borrower, the Company shall be obligated to reimburse the Lender hereunder for any and all drawings under such Letter of Credit. The Company hereby acknowledges that the issuance of Letters of Credit for the account of Subsidiaries inures to the benefit of the Company, and that the Company’s business derives substantial benefits from the businesses of such Subsidiaries.

2.04 Prepayments.

(a) Each Borrower may, upon notice from the Company to the Lender, at any time or from time to time voluntarily prepay Loans in whole or in part without premium or penalty; provided that (i) such notice must be received by the Lender not later than 1:00 p.m. (A) [*] date of prepayment of Eurocurrency Fixed Rate Loans denominated in Dollars, (B) [*] date of prepayment of Eurocurrency Fixed Rate Loans denominated in Alternative Currencies , and (C) [*] date of prepayment of Eurocurrency Floating Rate Loans or Base Rate Loans; (ii) any prepayment of Eurocurrency Fixed Rate Loans denominated in Dollars shall be [*] ; (iii) any prepayment of Eurocurrency Fixed Rate Loans denominated in Alternative Currencies shall be [*] ; and (iv) any prepayment of Eurocurrency Floating Rate Loans or Base Rate Loans shall be [*] . Each such notice shall specify the date and amount of such prepayment and the Type(s) of Loans to be prepaid and, [*] . If such notice is given by the Company, the applicable Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. [*] .

(b) If the Lender notifies the Company at any time that the Total Outstandings at such time exceed an amount equal to [*] of the Commitment then in effect, then, within [*] after receipt of such notice, the Borrowers shall prepay Loans and/or the Company shall Cash Collateralize the L/C Obligations in an aggregate amount sufficient to reduce such Outstanding Amount as of such date of payment to an amount not to exceed 100% of the Commitment then in effect; provided, however, that, subject to the provisions of Section 2.03(f)(ii), the Company shall not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.04(b) unless after the prepayment in full of the Loans the Total Outstandings exceed the amount of the Commitment. [*] .

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2.05 Termination or Reduction of Commitment. The Company may, upon notice to the Lender, terminate the Commitment, or from time to time permanently reduce the amount of the Commitment; provided that (i) any such notice shall be received by the Lender not later than 1:00 p.m. [*] the date of termination or reduction, (ii) any such partial reduction shall be [*] , (iii) the Company shall not terminate or reduce the amount of the Commitment if, after giving effect thereto and to any concurrent prepayments hereunder, [*] , and (iv) if, after giving effect to any reduction of the amount of the Commitment, [*] .

2.06 Repayment of Loans. Each Borrower shall repay to the Lender on the Maturity Date the aggregate principal amount of Loans made to such Borrower outstanding on such date.

2.07 Interest.

(a) Subject to the provisions of subsection (b) below, (i) each Eurocurrency Floating Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Eurocurrency Floating Rate plus the Applicable Margin plus [] the Mandatory Cost, if any; (ii) each Eurocurrency Fixed Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurocurrency Fixed Rate for such Interest Period plus the Applicable Margin plus [] the Mandatory Cost, if any; and (iii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Margin applicable to Base Rate Loans.

(b) (i) If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

(ii) If any amount (other than principal of any Loan) payable by any Borrower under any Loan Document is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the Lender, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

(iii) Upon the request of the Lender, while any Event of Default of the types described in Sections 9.01(a), (i) or (j) exists, the Borrowers shall pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

(iv) Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

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(c) Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

2.08 Fees In addition to certain fees described in subsections (h) and (i) of Section 2.03:

(a) Commitment Fee. The Company shall pay to the Lender, a commitment fee in Dollars equal to the Applicable Margin applicable to Commitment Fee times the actual daily amount by which the amount of the Commitment exceeds the Total Outstandings. The commitment fee shall accrue at all times during the Availability Period, including at any time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the last day of the Availability Period. The commitment fee shall be calculated quarterly in arrears, and if there is any change in the Applicable Margin during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Margin separately for each period during such quarter that such Applicable Margin was in effect.

(b) Other Fees. The Company shall pay to the Lender, in Dollars, such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

2.09 Computation of Interest and Fees All computations of interest for Base Rate Loans when the Prime Rate is determined by the Lender’s “prime rate” shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year), or, in the case of interest in respect of Loans denominated in Alternative Currencies as to which market practice differs from the foregoing, in accordance with such market practice. Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.11, bear interest for one day. Each determination by the Lender of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

2.10 Evidence of Debt. The Credit Extensions made by the Lender shall be evidenced by one or more accounts or records maintained by the Lender in the ordinary course of business. The accounts or records maintained by the Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lender to the Borrowers and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrowers hereunder to pay any amount owing with respect to the Obligations. Upon the request of the Lender to a Borrower, such Borrower shall execute and deliver to the Lender a Note, which shall evidence the Loans to such Borrower in addition to such accounts or records. The Lender may attach schedules to a Note and endorse thereon the

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date, Type (if applicable), amount, currency and maturity of the Loans and payments with respect thereto.

2.11 Payments Generally. All payments to be made by the Borrowers shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein and except with respect to principal of and interest on Loans denominated in an Alternative Currency, all payments by the Borrowers hereunder shall be made to the Lender at its Lending Office in Dollars and in Same Day Funds not later than 3:00 p.m. on the date specified herein. Except as otherwise expressly provided herein, all payments by the Borrowers hereunder with respect to principal and interest on Loans denominated in an Alternative Currency shall be made to the Lender at its Lending Office in such Alternative Currency and in Same Day Funds not later than the Applicable Time specified by the Lender on the dates specified herein. Without limiting the generality of the foregoing, the Lender may require that any payments due under this Agreement be made in the United States. If, for any reason, any Borrower is prohibited by any Law from making any required payment hereunder in an Alternative Currency, such Borrower shall make such payment in Dollars in the Dollar Equivalent of the Alternative Currency payment amount. If any payment to be made by any Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.

2.12 Designated Borrowers.

(a) Effective as of the date hereof each of the Designated Borrowers specified in the introductory paragraph hereto shall be a “Designated Borrower” hereunder and may receive Loans for its account on the terms and conditions set forth in this Agreement.

(b) The Company may at any time, upon not less than 15 Business Days’ notice from the Company to the Lender (or such shorter period as may be agreed by the Lender in its sole discretion), designate any Domestic Affiliate (an “Applicant Borrower”) as a Designated Borrower to receive Loans hereunder by delivering to the Lender a duly executed notice and agreement in substantially the form of Exhibit D (a “Designated Borrower Request and Assumption Agreement”). The parties hereto acknowledge and agree that prior to any Applicant Borrower becoming entitled to utilize the credit facilities provided for herein the Lender shall have received such supporting resolutions, incumbency certificates, opinions of counsel and other documents or information, in form, content and scope reasonably satisfactory to the Lender, as may be reasonably required by the Lender in its sole discretion, and Notes signed by such new Borrowers to the extent the Lender so requires. If the Lender agrees that an Applicant Borrower shall be entitled to receive Loans hereunder, then promptly following receipt of all such requested resolutions, incumbency certificates, opinions of counsel and other documents or information, the Lender shall send a notice in substantially the form of Exhibit E (a “Designated Borrower Notice”) to the Company specifying the effective date upon which the Applicant Borrower shall constitute a Designated Borrower for purposes hereof, whereupon each of the Lender agrees to permit such Designated Borrower to receive Loans hereunder, on the terms and conditions set forth herein, and each of the parties agrees that such Designated Borrower otherwise shall be a Borrower for all purposes of this Agreement; provided that no Loan Notice

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or Letter of Credit Application may be submitted by or on behalf of such Designated Borrower until the date five Business Days after such effective date.

(c) Each Domestic Affiliate that is or becomes a “Designated Borrower” pursuant to this Section 2.12 hereby irrevocably appoints the Company as its agent for all purposes relevant to this Agreement and each of the other Loan Documents, including (i) the giving and receipt of notices, (ii) the execution and delivery of all documents, instruments and certificates contemplated herein and all modifications hereto, and (iii) the receipt of the proceeds of any Loans made by the Lender, to any such Designated Borrower hereunder. Any acknowledgment, consent, direction, certification or other action which might otherwise be valid or effective only if given or taken by all Borrowers, or by each Borrower acting singly, shall be valid and effective if given or taken only by the Company, whether or not any such other Borrower joins therein. Any notice, demand, consent, acknowledgement, direction, certification or other communication delivered to the Company in accordance with the terms of this Agreement shall be deemed to have been delivered to each Designated Borrower.

(d) The Company may from time to time, upon not less than 15 Business Days’ notice from the Company to the Lender (or such shorter period as may be agreed by the Lender in its sole discretion), terminate a Designated Borrower’s status as such; provided that there are no outstanding Loans payable by such Designated Borrower, or other amounts payable by such Designated Borrower on account of any Loans made to it, as of the effective date of such termination.

2.13 Extension of Maturity Date.

(a) Requests for Extension. The Company may, by notice to the Lender [*] each anniversary of the Maturity Date (the “Maturity Anniversary Date”) request that the Lender extend the Maturity Date then in effect hereunder (the “Existing Maturity Date”) for an additional year from the Existing Maturity Date.

(b) Lender Election to Extend. The Lender, acting in its sole discretion, shall, by notice to the Company given not later than the date (the “Notice Date”) that is [*] prior to the applicable Maturity Anniversary Date, advise the Company whether or not the Lender agrees to extend the Existing Maturity Date and any conditions associated with such agreement to extend and if the Lender does not so advise the Company on or before the Notice Date, the Lender shall be deemed to have not agreed to such extension.

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY

3.01 Taxes.

(a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the respective Borrowers hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that if the applicable Borrower shall be required by applicable law to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions

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applicable to additional sums payable under this Section) the Lender receives an amount equal to the sum it would have received had no such deductions been made, (ii) such Borrower shall make such deductions and (iii) such Borrower shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

(b) Payment of Other Taxes by the Borrowers. Without limiting the provisions of subsection (a) above, each Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) Indemnification by the Borrowers. Each Borrower shall indemnify the Lender, within 10 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by the Lender and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority; provided that the Lender has paid such Indemnified Taxes in good faith. A certificate as to the amount of such payment or liability delivered to a Borrower by the Lender shall be conclusive absent manifest error.

(d) Evidence of Payments. As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Borrower to a Governmental Authority, such Borrower shall deliver to the Lender the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Lender.

(e) Treatment of Certain Refunds. If the Lender determines that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by any Borrower or with respect to which any Borrower has paid additional amounts pursuant to this Section, it shall pay to such Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by such Borrower under this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of the Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that each Borrower, upon the request of the Lender, agrees to repay the amount paid over to such Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Lender in the event the Lender is required to repay such refund to such Governmental Authority. The Lender agrees to provide to the Borrower evidence of any refund of any Taxes or Other Taxes described in the preceding sentence and the amount thereof; provided, however, that the Lender shall not incur any liability for failing to provide the Borrower with such evidence. This subsection shall not be construed to require the Lender to make available its tax returns (or any other information relating to its taxes that it deems confidential) to any Borrower or any other Person.

3.02 Illegality. If the Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for the Lender or its Lending Office to make, maintain or fund Eurocurrency Rate Loans (whether denominated in Dollars or an Alternative Currency), or to determine or charge interest rates based upon the Eurocurrency Rate, or any Governmental Authority has imposed material restrictions on the authority of the

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Lender to purchase or sell, or to take deposits of, Dollars or any Alternative Currency in the applicable interbank market, then, on notice thereof by the Lender to the Company, any obligation of the Lender to make or continue Eurocurrency Rate Loans in the affected currency or currencies or, in the case of Eurocurrency Rate Loans in Dollars, to convert Base Rate Loans to Eurocurrency Rate Loans, shall be suspended until the Lender notifies the Company that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrowers shall, upon demand from the Lender, prepay or, if applicable and such Loans are denominated in Dollars, convert all Eurocurrency Rate Loans to Base Rate Loans, either on the last day of the Interest Period therefor, if the Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, or immediately, if the Lender may not lawfully continue to maintain such Eurocurrency Rate Loans.

3.03 Inability to Determine Rates.

(a) Eurocurrency Floating Rate. If the Lender determines that for any reason in connection with any request for a Eurocurrency Floating Rate Loan or a conversion to or continuation thereof that (a) deposits (whether in Dollars or an Alternative Currency) are not being offered to banks in the applicable offshore interbank market for such currency for the applicable amount of such Eurocurrency Floating Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurocurrency Floating Rate with respect to a proposed Eurocurrency Rate Loan (whether denominated in Dollars or an Alternative Currency), or (c) the Eurocurrency Floating Rate with respect to a proposed Eurocurrency Floating Rate Loan does not adequately and fairly reflect the cost to the Lender of funding such Eurocurrency Floating Rate Loan, the Lender will promptly so notify the Company. Thereafter, the obligation of the Lender to make or maintain Eurocurrency Floating Rate Loans in the affected currency or currencies shall be suspended until the Lender revokes such notice. Upon receipt of such notice, the Company may revoke any pending request for a borrowing of, conversion to or continuation of Eurocurrency Floating Rate Loans in the affected currency or currencies or, failing that, will be deemed to have converted such request into a request for a borrowing of Base Rate Loans in the amount specified therein.

(b) Eurocurrency Fixed Rate. If the Lender determines that for any reason in connection with any request for a Eurocurrency Fixed Rate Loan or a conversion to or continuation thereof that (a) deposits (whether in Dollars or an Alternative Currency) are not being offered to banks in the applicable offshore interbank market for such currency for the applicable amount and Interest Period of such Eurocurrency Fixed Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurocurrency Fixed Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan (whether denominated in Dollars or an Alternative Currency), or (c) the Eurocurrency Fixed Rate for any requested Interest Period with respect to a proposed Eurocurrency Fixed Rate Loan does not adequately and fairly reflect the cost to the Lender of funding such Eurocurrency Fixed Rate Loan, the Lender will promptly so notify the Company. Thereafter, the obligation of the Lender to make or maintain Eurocurrency Fixed Rate Loans in the affected currency or currencies shall be suspended until the Lender revokes such notice. Upon receipt of such notice, the Company may revoke any pending request for a borrowing of, conversion to or continuation of Eurocurrency Fixed Rate Loans in the affected currency or currencies or, failing that, will be deemed to have

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converted such request into a request for a borrowing of Base Rate Loans in the amount specified therein.

3.04 Increased Costs; Reserves on Eurocurrency Rate Loans.

• (a) Increased Costs Generally. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, the Lender (except (A) any reserve requirement contemplated by Section 3.04(e) and (B) the requirements of the Bank of England and the Financial Services Authority or the European Central Bank reflected in the Mandatory Cost, other than as set forth below);

(ii) subject the Lender to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit or any Eurocurrency Rate Loan made by it, or change the basis of taxation of payments to the Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 3.01 and the imposition of, or any change in the rate of, any Excluded Tax payable by the Lender);

(iii) result in the failure of the Mandatory Cost, as calculated hereunder, to represent the cost to the Lender of complying with the requirements of the Bank of England and/or the Financial Services Authority or the European Central Bank in relation to its making, funding or maintaining Eurocurrency Rate Loans; or

(iv) impose on the Lender or the London interbank market any other condition, cost or expense affecting this Agreement or Eurocurrency Rate Loans made by the Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to the Lender of making or maintaining any Eurocurrency Rate Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to the Lender of issuing or maintaining any Letter of Credit (or of maintaining its obligation to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by the Lender hereunder (whether of principal, interest or any other amount) then, upon request of the Lender, the Company will pay (or cause the applicable Designated Borrower to pay) to the Lender such additional amount or amounts as will compensate the Lender for such additional costs incurred or reduction suffered.

(b) Capital Requirements. If the Lender determines that any Change in Law affecting the Lender or its Lending Office or its holding company, if any, regarding capital requirements has or would have the effect of reducing the rate of return on the Lender’s capital or on the capital of its holding company, if any, as a consequence of this Agreement, the Commitment, the Loans or the Letters of Credit, to a level below that which the Lender or its holding company could have achieved but for such Change in Law (taking into consideration the Lender’s policies and the policies of its holding company with respect to capital adequacy), then from time to time the Company will pay (or cause the applicable Designated Borrower to pay) to the Lender such additional amount or amounts as will compensate the Lender or its holding company for any such reduction suffered.

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(c) Certificates for Reimbursement. A certificate of the Lender setting forth the amount or amounts necessary to compensate the Lender or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to the Company shall be conclusive absent manifest error. The Company shall pay (or cause the applicable Designated Borrower to pay) the Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Delay in Requests. Failure or delay on the part of the Lender to demand compensation pursuant to the foregoing provisions of this Section shall not constitute a waiver of the Lender’s right to demand such compensation; provided that no Borrower shall be required to compensate the Lender pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than three months prior to the date that the Lender notifies the Company of the Change in Law giving rise to such increased costs or reductions and of the Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the three-month period referred to above shall be extended to include the period of retroactive effect thereof).

(e) Additional Reserve Requirements. The Company shall pay (or cause the applicable Designated Borrower to pay) to the Lender, (i) as long as the Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurocurrency Rate Loan equal to the actual costs of such reserves allocated to such Loan by the Lender (as determined by the Lender in good faith, which determination shall be conclusive), and (ii) as long as the Lender shall be required to comply with any reserve ratio requirement or analogous requirement of any other central banking or financial regulatory authority imposed in respect of the maintenance of the Commitment or the funding of the Eurocurrency Rate Loans, such additional costs (expressed as a percentage per annum and rounded upwards, if necessary, to the nearest five decimal places) equal to the actual costs allocated to the Commitment or the Loans by the Lender (as determined by the Lender in good faith, which determination shall be conclusive), which in each case shall be due and payable on each date on which interest is payable on such Loan; provided the Company shall have received at least 10 days’ prior notice of such additional interest or costs from the Lender. If the Lender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional interest or costs shall be due and payable 10 days from receipt of such notice.

3.05 Compensation for Losses. Upon demand of the Lender from time to time, the Company shall promptly compensate (or cause the applicable Designated Borrower to compensate) the Lender for and hold the Lender harmless from any loss, cost or expense incurred by it as a result of:

(a) any continuation, conversion, payment or prepayment of any Eurocurrency Fixed Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b) any failure by any Borrower (for a reason other than the failure of the Lender to make a Loan) to prepay, borrow, continue or convert any Eurocurrency Fixed Rate Loan on the date or in the amount notified by the Company or the applicable Designated Borrower; or

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(c) any failure by any Borrower to make payment of any Loan or drawing under any Letter of Credit (or interest due thereon) denominated in an Alternative Currency on its scheduled due date or any payment thereof in a different currency;

including any loss of anticipated profits, any foreign exchange losses and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan, from fees payable to terminate the deposits from which such funds were obtained or from the performance of any foreign exchange contract. The Company shall also pay (or cause the applicable Designated Borrower to pay) any reasonable and customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Company (or the applicable Designated Borrower) to the Lender under this Section 3.05, the Lender shall be deemed to have funded each Eurocurrency Fixed Rate Loan made by it at the Eurocurrency Fixed Rate for such Loan by a matching deposit or other borrowing in the offshore interbank market for such currency for a comparable amount and for a comparable period, whether or not such Eurocurrency Fixed Rate Loan was in fact so funded.

3.06 Survival. All of the Borrowers’ obligations under this Article III shall survive termination of the Commitment and repayment of all other Obligations hereunder.

ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01 Conditions of Initial Credit Extension. The obligation of the Lender to make its initial Credit Extension hereunder is subject to satisfaction of the following conditions precedent:

(a) The Lender’s receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and substance satisfactory to the Lender and its legal counsel:

(i) executed counterparts of this Agreement, sufficient in number for distribution to the Lender and the Company;

• (ii) executed counterparts of the Guaranty, sufficient in number for distribution to the Lender and the Company;

• (iii) Notes executed by the Borrowers in favor of the Lender;

(iv) such certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as the Lender may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party;

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(v) such documents and certifications as the Lender may reasonably require to evidence that each Loan Party is duly organized or formed, and that each Loan Party is validly existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect;

(vi) favorable opinions of Baker & McKenzie LLP, counsel to the Borrowers and the Parent, each addressed to the Lender, as to such other matters concerning the Loan Parties and the Loan Documents as the Lender may reasonably request;

(vii) a certificate of a Responsible Officer of each Loan Party either (A) attaching copies of all consents, licenses and approvals required in connection with the execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full force and effect, or (B) stating that no such consents, licenses or approvals are so required;

(viii) a certificate signed by a Responsible Officer of the Parent (A) certifying that (A) each of the Material Credit Agreements are in full force and effect and that no default or event of default (howsoever defined) has occurred and is continuing under any of the Material Credit Agreements and (B) certifying that the financial covenants set forth in Section 5.10 of the Guaranty are no less restrictive than the financial covenants set forth in the Material Credit Agreements;

(ix) a certificate signed by a Responsible Officer of the Company certifying (A) that the conditions specified in Sections 4.02(a) and (b) have been satisfied, and (B) that there has been no event or circumstance since June 30, 2009 that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect;

(x) such other assurances, certificates, documents, consents or opinions as the Lender reasonably may require.

(b) Any fees required to be paid on or before the Closing Date shall have been paid.

(c) Unless waived by the Lender, the Company shall have paid all fees, charges and disbursements of counsel to the Lender (directly to such counsel if requested by the Lender) to the extent invoiced prior to or on the Closing Date, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Company and the Lender);.

(d) The Closing Date shall have occurred on or before November 12, 2009.

4.02 Conditions to all Credit Extensions. The obligation of the Lender to honor any Request for Credit Extension (other than a Loan Notice requesting only a conversion of Loans to the other Type, or a continuation of Eurocurrency Fixed Rate Loans) is subject to the following conditions precedent:

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(a) The representations and warranties of (i) the Borrowers contained in Article V, (ii) the Parent contained in Article IV of the Guaranty and (iii) each Loan Party contained in each other Loan Document or in any document furnished at any time under or in connection herewith or therewith, shall be true and correct on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date, and except that for purposes of this Section 4.02, the representations and warranties contained in subsection (a) of Section 4.06 of the Guaranty shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 5.01 of the Guaranty.

(b) No Default shall exist, or would result from such proposed Credit Extension or the application of the proceeds thereof.

(c) The Lender shall have received a Request for Credit Extension in accordance with the requirements hereof.

(d) If the applicable Borrower is a Designated Borrower, then the conditions of Section 2.12 to the designation of such Borrower as a Designated Borrower shall have been met to the satisfaction of the Lender.

(e) In the case of a Credit Extension to be denominated in an Alternative Currency, there shall not have occurred any change in national or international financial, political or economic conditions or currency exchange rates or exchange controls which in the reasonable opinion of the Lender would make it impracticable for such Credit Extension to be denominated in the relevant Alternative Currency.

Each Request for Credit Extension (other than a Loan Notice requesting only a conversion of Loans to the other Type or a continuation of Eurocurrency Fixed Rate Loans) submitted by the Company shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

ARTICLE V. REPRESENTATIONS AND WARRANTIES

Each Borrower represents and warrants to the Lender that:

5.01 Existence, Qualification and Power. Each Borrower (a) is duly organized or formed, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under this Agreement and the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

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5.02 Authorization; No Contravention. The execution, delivery and performance by each Borrower of this Agreement and each other Loan Document to which it is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of any of such Borrower’s Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which such Borrower is a party or affecting such Borrower or the properties of such Borrower or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law, to the extent, in the case of clauses (b) and (c), any such conflict, breach, contravention or violation, could reasonably be expected to have a Material Adverse Effect.

5.03 Governmental Authorization; Other Consents. No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Borrower of this Agreement or any other Loan Document to which any Borrower is a party.

5.04 Binding Effect. This Agreement has been, and each other Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Borrower that is party thereto. This Agreement constitutes, and each other Loan Document when so delivered will constitute, a legal, valid and binding obligation of such Borrower, enforceable against each Borrower that is party thereto in accordance with its terms.

5.05 Litigation. No litigation, tax claim, dispute arbitration, administrative proceeding or other similar proceeding is presently current or pending or, to a Relevant Company’s knowledge, threatened that (a) purports to pertain to this Agreement or any other Loan Document, or any of the transactions contemplated hereby or (b) which might, individually or in the aggregate, have a Material Adverse Effect.

5.06 No Default. No Borrower is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

5.07 Ownership of Property; Liens. Each Borrower is the legal and beneficial owner of its assets and undertaking. The property of each Borrower is subject to no Liens, other than Liens permitted by Section 7.01.

5.08 Environmental Compliance. Other than those authorizations which a failure to obtain or maintain is not likely to have a Material Adverse Effect, each Borrower has obtained all authorizations it is required to obtain under any Environmental Laws and such authorizations are in full force and effect.

5.09 ERISA Compliance. Other than with respect to clause (v) of subsection (d) below, except for matters that could reasonably be expected to result in a Material Adverse Effect:

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(a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of each Borrower, nothing has occurred which would prevent, or cause the loss of, such qualification. Each Borrower and each ERISA Affiliate have made all required contributions to each Plan subject to Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan.

(b) There are no pending or, to the best knowledge of each Borrower, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan that could reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has resulted or could reasonably be expected to result in a Material Adverse Effect.

(c) (i) No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) no Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) no Borrower nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) no Borrower nor any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.

5.10 Subsidiaries; Equity Interests. No Borrower has any Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.10, and all of the outstanding Equity Interests in such Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by a Loan Party in the amounts specified on Part (a) of Schedule 5.10 free and clear of all Liens. No Borrower has any equity investments in any other corporation or entity other than those specifically disclosed in Part (b) of Schedule 5.10. All of the outstanding Equity Interests in each Borrower have been validly issued, are fully paid and nonassessable and are owned by Persons and in the amounts specified on Part (c) of Schedule 5.10 free and clear of all Liens.

5.11 Margin Regulations; Investment Company Act; Public Utility Holding Company Act.

(a) No Borrower is engaged or will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock.

(b) No Borrower nor, no Person Controlling any Borrower, nor any Subsidiary (i) is a “holding company,” or a “subsidiary company” of a “holding company,” or an “affiliate” of a “holding company” or of a “subsidiary company” of a “holding company,” within the meaning

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of the Public Utility Holding Company Act of 1935, or (ii) is or is required to be registered as an “investment company” under the Investment Company Act of 1940.

5.12 Disclosure. All information provided to the Lender by or on behalf of any Borrower in relation to it, its assets, business or affairs or the Loan Documents was correct and not misleading (by omission or otherwise) as at the time it was provided.

5.13 Compliance with Laws. Each Borrower is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

5.14 Taxpayer Identification Number; Other Identifying Information. The true and correct U.S. taxpayer identification number of each Borrower a party hereto on the Closing Date is set forth on Schedule 10.02.

5.15 No Filing or Stamp Taxes. Under the law of any relevant jurisdiction it is not necessary that the Loan Documents be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp duty, registration or other similar Tax be paid on or in relation to the Loan Documents or the transactions contemplated by those Loan Documents.

5.16 Taxation. To the best of each Borrower’s knowledge, information and belief, having made due enquiries, it has complied with all material laws relating to Tax in all jurisdictions in which it is subject to Tax and has paid all Taxes due and payable by it (other than those Taxes which it is contesting in good faith and in respect of which it has made adequate reserves as long as failure to pay those Taxes would not have, and is not reasonably likely to have, a Material Adverse Effect).

5.17 Pari Passu. Each Borrower’s payment obligations under the Loan Documents rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.

5.18 Governing Law and Enforcement. Subject to any qualification in any legal opinion provided to the Lender pursuant to the Loan Documents relating to it or the laws of its jurisdiction:

(i) the choice of law referred to in this Agreement as the governing law of the Loan Documents will be recognized and enforced in its jurisdiction of incorporation or organization and in the jurisdiction referred to in that clause (if different); and

(ii) any judgment obtained against it in that jurisdiction will be recognized and enforced in its jurisdiction of incorporation or organization.

5.19 Not a Trustee. No Borrower enters into any Loan Document as trustee of any trust or settlement.

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5.20 Commercial Benefit. The entering into and performance by each Borrower of its obligations under the Loan Documents to which it is expressed to be a party is for its commercial benefit and is in its commercial interests.

5.21 Full Disclosure. Each Borrower has disclosed in writing to the Lender all facts relating to it and its Subsidiaries, the Loan Documents and all things in connection with them, which are material to the assessment of the nature and amount of the risk undertaken by the Lender in entering into the Loan Documents and doing anything in connection with them.

5.22 Litigation. No litigation, tax claim, dispute arbitration, administrative proceeding or other similar proceeding is presently current or pending or, to a Borrower’s or its Subsidiaries’ knowledge, threatened, which might have a Material Adverse Effect.

5.23 Representations True. Each of Borrower’s representations and warranties contained in the Loan Documents is correct and not misleading when made or repeated.

5.24 Latest Audited Financial Statements; No Material Adverse Effect.

(a) The Latest Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of the Borrowers and their Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Borrowers and their Subsidiaries as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.

(b) Since the date of the Latest Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

ARTICLE VI. AFFIRMATIVE COVENANTS

So long as the Commitment shall be in effect, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, each Borrower shall:

6.01 Information. Deliver to the Lender, in form and detail satisfactory to the Lender, such additional information regarding the business, financial or corporate affairs of each Borrower, or compliance with the terms of the Loan Documents, as the Lender may from time to time reasonably request.

6.02 Notices. Promptly notify the Lender:

• (a) of the occurrence of any Default;

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(b) of any breach of any Environmental Law or the issuing of any proceedings or notice or requirements against or upon it or its assets in respect of, or which is likely to result in, any environmental liability or breach of any Environmental Law in each case, which has had, or is reasonably likely to have a Material Adverse Effect;

(c) of the commencement of, or any material development in, any litigation, arbitration, administrative or other proceeding in respect of it or any of its assets being commenced or threatened which is in excess of $25,000,000 or its equivalent;

• (d) of the occurrence of any ERISA Event;

(d) of any proposal of any Government Authority to compulsorily acquire the whole or a substantial part of its assets; and

• (e) of the acquisition or formation by it of a Subsidiary.

Each notice pursuant to this Section 6.02 shall be accompanied by a statement of a Responsible Officer of the Company setting forth details of the occurrence referred to therein and stating what action the Company has taken and proposes to take with respect thereto. Each notice pursuant to Section 6.02(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

6.03 Payment of Obligations. Pay and discharge its obligations and liabilities, including (a) tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by such Borrower; (b) all lawful claims which, if unpaid, would by law become a Lien upon its property; and (c) all Indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness.

6.04 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 7.02 or 7.03; and (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

6.05 Maintenance of Properties; Conduct of Business; Insurance.

(a) Maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted.

(b) Conduct its business (including collecting debts owed to it) in a proper, orderly and efficient manner;

• (c) and shall ensure that each of its Subsidiaries will:

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(i) maintain industrial special risks insurance, public liability insurance, professional indemnity liability insurance and directors and officers liability insurance with an independent and reputable insurer and consistent with the insurances maintained by it as at the date of this Agreement;

(ii) otherwise insure, and keep insured, its property which is of an insurable nature in the manner and to the extent which is in accordance with good business practice for property of such nature; and

(iii) promptly following a request by the Lender, provide the Lender with any certificates of currency or other evidence of currency in respect of all insurances required to be maintained by it under this Agreement.

6.06 Compliance with Laws. Ensure that each Relevant Company will:

(a) comply with all laws and legal requirements, including each judgment, award, decision, finding or any other determination of a government agency, which applies to it or any of its assets, where failure to do so will have or be likely to have a Material Adverse Effect;

(b) obtain, maintain and comply with:

(i) all authorizations required in relation to the entry into, performance of obligations under, and enforceability of, each Loan Document to which it is a party; and

(ii) all authorizations that are material to the carrying on of the business of the Sims Group (taken as a whole) where failure to do so has or is likely to have a Material Adverse Effect,

(iii) and ensure those authorizations are not cancelled, suspended, not renewed, varied or found to be invalid; and

(c) not do anything which would prevent the renewal of any authorization referred to in subsection (b) above or cause it to be renewed on less favorable terms.

6.07 Books and Records. (a) Maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of such Borrower; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over such Borrower.

6.08 Use of Proceeds. Use the proceeds of the Credit Extensions for non-hostile acquisitions and for general corporate purposes not in contravention of any Law or of any Loan Document.

6.09 Most Favored Nations Status. Promptly, but in any event within fifteen (15) days after the occurrence of each such event or matter, give written notice (“Borrower MFN Notice”) to the Lender specifying in reasonable detail the incurrence of any new or additional material Indebtedness and the material terms (other than pricing) thereof, and of any change,

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whether by addition or modification in the material terms (other than pricing), conditions, covenants (including financial covenants) or events of default of any material Indebtedness. If the Lender determines in its sole discretion that the terms, covenants (including financial covenants) or events of default of any material Indebtedness of any Loan Party existing on the date of this Agreement or incurred thereafter are more restrictive with respect to any Loan Party than the terms, conditions, covenants (including financial covenants) or events of default of this Agreement, the Lender shall promptly, but in any event within fifteen (15) days after the Lender’s receipt of the Borrower MFN Notice, give written notice (“Lender MFN Notice”) to the Company specifying in reasonable detail those terms, conditions, covenants (including financial covenants) or events of default of such Indebtedness, if any, that the Lender will require to be incorporated in this Agreement and the other Loan Documents. In the event that the Lender delivers a Lender MFN Notice, then within thirty (30) days after the Company’s receipt thereof, the Company shall, and shall cause each Loan Party to, execute and deliver to the Lender such documents, instruments, consents and agreements in form and content satisfactory to the Lender, as may be required by the Lender in its sole discretion, in order to incorporate into this Agreement and the other Loan Documents the terms, conditions, covenants (including financial covenants) and events of default specified in the Lender MFN Notice, together with such supporting resolutions, incumbency certificates, opinions of counsel and other documents or information, in form, content and scope satisfactory to the Lender, as may be required by the Lender in its sole discretion.

ARTICLE VII. NEGATIVE COVENANTS

So long as the Commitment shall be in effect, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Company shall not, nor shall it permit any Subsidiary to, directly or indirectly:

7.01 Liens. Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than Liens permitted under Section 6.01 of the Guaranty.

7.02 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into another Person, except that, so long as no Default exists or would result therefrom, any Borrower may merge with any one or more other Borrowers.

7.03 Dispositions. Make any Disposition or agree or attempt to do so (whether in one or more related or unrelated transactions) except Dispositions permitted under Section 6.03 of the Guaranty.

7.04 Change in Nature of Business. Engage in any material line of business substantially different from those lines of business conducted by the Borrowers on the date hereof or any business substantially related or incidental thereto.

7.05 Finance Debt.

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(a) Provide any Finance Debt, or give any Guarantee in respect of any Finance Debt, to or for the benefit of any Person, other than Permitted Finance Debt or with the prior written consent of the Lender.

(b) Permit Finance Debt to remain owing to it by a Borrower or any of its Subsidiaries which is not a Loan Party.

(c) Satisfy any Finance Debt owed to a Borrower or any of its Subsidiaries which is not a Loan Party, except any Finance Debt which, in aggregate with all other Finance Debt owed by a Loan Party to a Borrower or any of its Subsidiaries which is not a Loan Party that is satisfied in the twelve (12) month period prior to the date on which the Finance Debt is to be satisfied, does not exceed AU$10,000,000.

7.06 Use of Proceeds. Use the proceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

7.07 Negative Pledge.

(a) Deposit money with a Person in circumstances where the money is not repayable unless the Borrower performs obligations (including to pay money) to that Person, except in respect of deposits which in aggregate do not exceed AU$35,000,000 at any time.

(b) Enter into any arrangement which, if complied with, would prevent any Loan Party from complying with its obligations under the Loan Documents.

7.08 Swap Contracts. Enter into a Swap Contract except:

(a) for the purposes of hedging that Borrower’s actual or projected interest rate, foreign exchange or other exposures arising in the ordinary course of its ordinary business and not for speculative purposes; or

• (b) with the Lender’s prior written consent.

ARTICLE VIII. CROSS-GUARANTY

8.01 Cross-Guaranty. Each Borrower hereby agrees that such Borrower is jointly and severally liable for, and subject to the provisions of Section 8.02, each Borrower hereby irrevocably, absolutely and unconditionally guarantees, as a primary obligor and not merely as a surety, the full and punctual payment or performance when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise, and at all times thereafter, all of the Obligations owed or hereafter owing to the Lender by each other Borrower. Without limiting the generality of the foregoing, each Borrower’s liability hereunder shall extend to all amounts that constitute part of the Obligations and would be owed by another Borrower to the Lender under the Loan Documents but for the operation of the automatic stay under Section

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362(a) of the Bankruptcy Code of the United States of America (Title 11, United States Code) (the “Bankruptcy Code”) or the operation of Sections 502(b) and 506(b) of the Bankruptcy Code.

8.02 Limitation of Liability. Anything contained in this Article VIII to the contrary notwithstanding, if any Fraudulent Transfer Law (as hereinafter defined) is determined by a court of competent jurisdiction to be applicable to the guaranty obligations of any Borrower hereunder, such obligation shall be limited to a maximum aggregate amount equal to the largest amount that would not render its obligations hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of the Bankruptcy Code or any applicable provisions of comparable state law (collectively, the “Fraudulent Transfer Laws”), in each case after giving effect to all other liabilities of such Borrower, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liabilities of such Borrower in respect of intercompany indebtedness to the other Borrowers or other Affiliates of the other Borrowers to the extent that such indebtedness would be discharged in an amount equal to the amount paid by such Borrower hereunder) and after giving effect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation, reimbursement, indemnification or contribution of such Borrower pursuant to applicable Law or pursuant to the terms of any agreement.

8.03 Liability of Borrowers Absolute. Each Borrower agrees that its guaranty obligation hereunder are irrevocable, absolute, independent and unconditional and shall not be affected by any circumstance which constitutes a legal or equitable discharge of a guarantor or surety other than payment in full of the Obligations guaranteed hereunder. In furtherance of the foregoing and without limiting the generality thereof, each Borrower agrees as follows:

(a) Its guaranty obligation hereunder constitutes a guaranty of payment and performance when due and not of collection.

(b) The Lender may enforce its guaranty obligation hereunder upon the occurrence of an Event of Default under the Loan Documents notwithstanding the existence of any dispute between or among any other Borrower and the Lender with respect to the existence of such Event of Default.

(c) The guaranty obligations of each Borrower hereunder are independent of the obligations of the Borrowers hereunder or under the Loan Documents and the obligations of any other guarantor of the Obligations, and a separate action or actions may be brought and prosecuted against each Borrower to enforce its guaranty obligations hereunder, irrespective of whether any action is brought against any other Borrower or any other Loan Party or whether any other Borrower or any other Loan Party is joined in any such action or actions.

(d) Payment by the Borrowers of a portion, but not all, of the Obligations shall in no way limit, affect, modify or abridge any Borrower’s liability for any portion of the Obligations which has not been paid. Without limiting the generality of the foregoing, if the Lender is awarded a judgment in any suit brought to enforce any Borrower’s covenant to pay a portion of the Obligations, such judgment shall not be deemed to release any Borrower from its covenant to pay the portion of the Obligations that is not the subject of such suit.

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(e) The Lender upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability of the guaranty obligations of each Borrower hereunder or giving rise to any reduction, limitation, impairment, discharge or termination of the guaranty obligations any Borrower hereunder, from time to time may (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Obligations, (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations, (iii) request and accept other guaranties of the Obligations, (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any other guaranties of the Obligations, or any other obligation of any Person (including any other Borrower) with respect to the Obligations and (v) exercise any other rights available to them under the Loan Documents.

(f) The guaranty obligations of each Borrower hereunder shall be valid and enforceable and shall not be subject to any reduction, limitation, impairment, discharge or termination for any reason (other than payment in full of the Obligations), including the occurrence of any of the following, whether or not such Borrower shall have had notice or knowledge of any of them: (i) any failure or omission to assert or enforce an agreement or election not to assert or enforce, or the stay or enjoining, by order of court, by operation of law or otherwise, of the exercise or enforcement of, any claim or demand or any right, power or remedy (whether arising at law, in equity or otherwise) with respect to the Obligations or any agreement relating thereto, or with respect to any other guaranty of the payment of the Obligations; (ii) any rescission, waiver, amendment or modification of, or any consent to departure from, any of the terms or provisions (including provisions relating to events of default) of the Loan Documents or any agreement or instrument executed pursuant thereto, or of any other guaranty for the Obligations, in each case whether or not in accordance with the terms of the Loan Documents or any agreement relating to such other guaranty; (iii) the Obligations, or any agreement relating thereto, at any time being found to be illegal, invalid or unenforceable in any respect; (iv) the application of payments received from any source to the payment of indebtedness of the Borrowers other than the Obligations, even though the Lender might have elected to apply such payment to any part or all of the Obligations; (v) the Lender’s consent to the change, reorganization or termination of the corporate structure or existence of any Borrower or any of their Subsidiaries and to any corresponding restructuring of the Obligations; (vi) any defenses, set-offs or counterclaims which the Borrower may allege or assert against the Lender in respect of the Obligations, including failure of consideration, breach of warranty, payment, statute of frauds, statute of limitations, accord and satisfaction and usury; and (vii) any other act or thing or omission, or delay to do any other act or thing, which may or might in any manner or to any extent vary the risk of any Borrower as an obligor in respect of the Obligations.

8.04 Waivers by Borrowers. Each Borrower hereby waives, for the benefit of the Lender:

(a) any right to require the Lender, as a condition of payment or performance by any Borrower, to (i) proceed against the Borrowers, any other guarantor of the Guaranteed Obligations or any other Person, (ii) proceed against or have resort to any balance of any deposit

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account or credit on the books of the Lender in favor of any Borrower or any other Person, or (iii) pursue any other remedy in the power of the Lender whatsoever;

(b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of any Borrower including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of any Borrower from any cause other than payment in full of the Obligations;

(c) any defense based upon any Law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal;

(d) any defense based upon the Lender’s errors or omissions in the administration of the Obligations, except behavior which amounts to bad faith;

(e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of this Article VIII and any legal or equitable discharge of any Borrower’s obligations hereunder, (ii) the benefit of any statute of limitations affecting any Borrower’s liability hereunder or the enforcement hereof, and (iii) any rights to set-offs, recoupments and counterclaims;

(f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, notices of default under the Loan Documents or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations or any agreement related thereto, notices of any extension of credit to any Borrower and notices of any of the matters referred to in Section 8.03 above and any right to consent to any thereof; and

(g) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of this Article VIII.

8.05 Borrower’s Rights of Subrogation, Contribution, Etc. Until all of the Obligations shall have been finally and indefeasibly paid and performed in full, the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to this Agreement have been surrendered, each Borrower waives any claim, right or remedy, direct or indirect, that such Borrower now has or may hereafter have against any other Borrower or any of their assets in connection with this Article VIII or the performance by such Borrower of its guaranty obligations hereunder, in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including (a) any right of subrogation, reimbursement or indemnification that such Borrower now has or may hereafter have against any other Borrower, and (b) any right to enforce, or to participate in, any claim, right or remedy that the Lender now has or may hereafter have against any other Borrower. In addition, until all of the Obligations shall have been finally and indefeasibly paid and performed in full, the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to this Agreement have been surrendered, each Borrower shall withhold exercise of any right of

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contribution such Borrower may have against any other guarantor of the Obligations. Each Borrower further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification such Borrower may have against any other Borrower, and any rights of contribution such Borrower may have against any such other guarantor, shall be junior and subordinate to any rights the Lender may have against each Borrower, and to any right the Lender may have against such other guarantor. If any amount shall be paid to a Borrower on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when the Obligations shall not have been finally and indefeasibly paid and performed in full, the Commitment shall not have been terminated, all Letters of Credit issued or deemed issued pursuant to this Agreement shall not have been surrendered shall not have been terminated, such amount shall be held in trust for the Lender and shall forthwith be paid over to the Lender to be applied against the Obligations, whether matured or unmatured, in accordance with the terms hereof.

8.06 Continuing Guaranty; Reinstatement of Guaranty.

(a) The guaranty obligations of each Borrower hereunder shall be continuing and shall remain in effect until all of the Obligations shall have been finally and indefeasibly paid and performed in full (other than contingent indemnification obligations), the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to this Agreement have expired or been terminated. Each Borrower hereby irrevocably waives any right to revoke its guaranty obligations hereunder as to future transactions giving rise to any Obligations.

(b) In the event that all or any portion of the Obligations are paid by any Borrower or by any other guarantor, the obligations of each Borrower hereunder shall continue and remain in full force and effect or be reinstated, as the case may be, in the event that all or any part of such payment(s) are rescinded or recovered directly or indirectly from the Lender as a preference, fraudulent transfer or otherwise, and any such payments which are so rescinded or recovered shall constitute Obligations for all purposes under this Article VIII.

8.07 Indemnity and Contribution. Each Borrower (for purposes of this Section 8.07, a “Contributing Party”) agrees (subject to the provisions of Section 8.05) that, in the event a payment shall be made by any other Borrower under this Article VIII of all or any of the Obligations (other than Credit Extensions for which that Borrower is primarily liable) (for purposes of this Section 8.07, a, the “Claiming Party”), the Contributing Party shall indemnify the Claiming Party in an amount equal to the amount of such payment multiplied by a fraction of which the numerator shall be the net worth of the Contributing Party on the date of this Agreement (or, in the case of any Designated Borrower becoming a party hereto pursuant to Section 2.12 hereof, the effective date specified in the Designated Borrower Notice given by the Lender in respect of such Designated Borrower) and the denominator shall be the aggregate net worth of all the Borrowers on the date of this Agreement (or, in the case of any Designated Borrower becoming a party hereto pursuant to Section 2.12 hereof, the effective date specified in the Designated Borrower Notice given by the Lender in respect of such Designated Borrower).

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8.08 Liability Cumulative. The debts, liabilities, obligations, covenants and duties of Borrowers under this Article VIII is in addition to and shall be cumulative with all debts, liabilities, obligations, covenants and duties of each Borrower to Lender under this Agreement and the other Loan Documents to which such Borrower is a party or in respect of any Obligations or obligation of the other Borrowers, without any limitation as to amount, unless the instrument or agreement evidencing or creating such other liability specifically provides to the contrary.

ARTICLE IX. EVENTS OF DEFAULT AND REMEDIES

9.01 Events of Default. Any of the following shall constitute an Event of Default:

(a) Non-Payment. Any Borrower or any other Loan Party fails to pay (i) when and as required to be paid herein, and in the currency required hereunder, any amount of principal of any Loan or any L/C Obligation, or (ii) within three days after the same becomes due, any interest on any Loan or on any L/C Obligation, or any commitment or other fee due hereunder, or (iii) within five days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or

(b) Specific Covenants. The Company fails to perform or observe any term, covenant or agreement contained in any of Section 6.01, 6.04, or 6.08 or Article VII, or the Parent fails to perform or observe any term, covenant or agreement contained in any of Sections 5.01, 5.02, 5.03, 5.05 or 5.10 or Article VI of the Guaranty; or

(c) Other Defaults. Any Loan Party fails to perform or observe any other covenant or agreement (not specified in subsection (a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days; or

(d) Representations and Warranties. Any representation, warranty, certification or statement of fact made or deemed made (i) by the Borrowers contained in Article V, (ii) by the Parent contained in Article IV of the Guaranty and (iii) or on behalf of any Loan Party contained in each other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or misleading in any material respect when made or deemed made; or

(e) Material Credit Agreements. A default or event of default (howsoever defined) has occurred and is continuing under any Material Credit Agreement, the effect of which default or other event is to cause, or to permit the counterparty or counterparties under such Material Credit Agreements to cause, with the giving of notice if required, the Indebtedness evidenced thereby or credit extended thereunder to be demanded or to become due prior to its stated maturity;

(f) Cross-Default. Any Finance Debt of a Relevant Company in an amount of at least AU$5,000,000 or its equivalent or of the Relevant Companies totaling (in aggregate for all such Relevant Companies) at least AU$25,000,000 or its equivalent:

(i) becomes due and payable before the scheduled date for payment (except as a result of an exercise of a prepayment right in the absence of default); or

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(ii) is not paid when due (after taking into account any applicable grace period); or

• (g) Change of Control. There occurs any Change of Control and 90 calendar days have elapsed following such Change of Control; or

• (h) Material Adverse Effect.

(i) Insolvency Proceedings, Etc. Any Relevant Company institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

(j) Inability to Pay Debts; Attachment. (i) Any Relevant Company becomes unable or admits in writing its inability or fails generally to pay its debts as they become due, or (ii) a distress, attachment, execution or other process of a Governmental Authority is issued against, levied or entered upon (A) an asset of a Relevant Company with a value or in an amount of at least AU$10,000,000 or its equivalent or (B) an asset or assets of the Relevant Companies totaling (in aggregate for all such Relevant Companies) at least AU$25,000,000 or its equivalent, and is not set aside or satisfied within 10 Business Days after its issue or levy; or

• (k) Judgments.

• (i) There is entered against the Relevant Companies

(A) one or more final judgments or orders for the payment of money totaling (in aggregate for all such Relevant Companies) at least AU$25,000,000 or its equivalent (to the extent not covered by independent third-party insurance as to which the insurer does not dispute coverage), or

(B) any one or more non-monetary final judgments,

that, in either case, if enforced under applicable law, could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or

(ii) a distress, attachment, execution or other process of a government agency is issued against, levied or entered upon:

(A) an asset of a Relevant Company with a value or in an amount of at least AU$10,000,000 or its equivalent; or

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(B) an asset or assets of Relevant Companies totaling (in aggregate for all such Relevant Companies) at least AU$25,000,000 or its equivalent,

and, in either case, is not set aside or satisfied within 10 Business Days; or

(l) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or could reasonably be expected to result in liability of any Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold Amount, or (ii) any Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or

(m) Invalidity of Loan Documents. Any provision of this Agreement, the Guaranty or any other Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan Party or any other Person contests in any manner the validity or enforceability of any provision of any Loan Document; or any Loan Party denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any provision of any Loan Document; or

(n) Cancellation of Commitment. An obligation upon any Person to provide Finance Debt to (i) a Relevant Company totaling at least AU$5,000,000 (or its equivalent) or (ii) the Relevant Companies totaling (in aggregate) at least AU$25,000,000 (or its equivalent), is terminated except as a result of voluntary termination in the absence of default; or

(o) Encumbrance. Any encumbrance is enforced against an asset or assets of a Relevant Company with value or in an amount exceeding AU$10,000,000 or its equivalent; or

(p) Suspends Payments. A Relevant Company suspends payment of its debts generally; or

(q) Unenforceability. (i) All or a material part of a Loan Document is illegal, void, voidable or unenforceable, or (ii) a Relevant Company becomes entitled to terminate any material provision of any Loan Document (other than following the occurrence of a termination event or event of default under a Swap Contract with the Lender in respect of which the Lender is an “Affected Party” or the “Defaulting Party” (as applicable) as defined in that Swap Contract), or (iii) the execution, delivery or performance of a Loan Document by a Loan Party or the exercise by the Lender of all or any of its rights under a Loan Document breaches or results in a contravention of any law; or

(r) Environmental. There is any claim or requirement of expenditure or alteration of activity or cessation of activity under any Environmental Law or law relating to health or there is any breach of any authorization, in each case which in the opinion of the Lender is likely to have a Material Adverse Effect or any circumstance arises which may give rise to such an action, claim, requirement or breach; or

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(s) Governmental interference. A law or anything done by a Governmental Authority is likely to in the opinion of the Lender have a Material Adverse Effect; or

(t) Seizure. All or any material part of the assets of the Sims Group are seized or otherwise appropriated by, or custody thereof is assumed by any Governmental Authority, or the Sims Group is otherwise prevented from exercising normal day-to-day control over all or a material part of its assets or loses any of the rights or privileges necessary to maintain its existence or to carry on its business and Sims does not demonstrate to the reasonable satisfaction of the Lender within fifteen (15) Business Days of such seizure, appropriation, assumption of custody or execution that no Material Adverse Effect has resulted, or is reasonably likely to result, therefrom; or

(u) Investigation. A Person is appointed under the Corporations Act or any other applicable legislation to investigate any part of the affairs of a Loan Party and the relevant Loan Party does not demonstrate to the reasonable satisfaction of the Lender within 15 Business Days of such appointment that no Material Adverse Effect has resulted from, or is reasonably likely to result from, the investigation or as a consequence thereof; or

(v) Deregistration. . A step is taken under section 601AA, 601AB or 601AC of the Corporations Act or analogous provisions in a relevant jurisdiction to cancel the registration of a Loan Party; or

• (w) ASX delisting/Suspension. Except with the written consent of the Lender, any securities of the Parent are:

• (i) not listed on at least one of:

• (A) the official list of the Australian Securities Exchange operated by ASX Limited; or

• (B) the official list of the New York Stock Exchange; or

(ii) suspended from quotation or trading on any official list referred to in clause (i) for 5 consecutive trading days (except where such suspension is requested by the Parent for the purpose of an acquisition or a fundraising and such securities remain suspended on that basis only and not on any other basis); or

• (iii) removed from the official list of any of:

• (A) the Australian Securities Exchange operated by ASX Limited;

• (B) the New York Stock Exchange; or

• (C) another stock exchange,

because the operator of the relevant stock exchange decides that the Parent or its securities no longer meet the requirements for continued listing (except where Sims has requested such removal and that is the sole basis for the removal); or

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(x) Ceasing Business. A Loan Party stops payment, significantly changes the general character of its business or threatens to do any of those things, or a Relevant Company ceases to carry on business, except to reconstruct or amalgamate while solvent, and which event may have a Material Adverse Effect.

9.02 Remedies Upon Event of Default.

(a) Remedies Generally. If any Event of Default occurs and is continuing, the Lender may take any or all of the following actions:

(i) declare the Commitment to be terminated, whereupon the Commitment shall be terminated;

(ii) declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by each Borrower;

(iii) require that the Company Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and

(iv) exercise all rights and remedies available to it under the Loan Documents or applicable Laws;

provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to any Borrower under the Bankruptcy Code of the United States, the Commitment shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of the Company to Cash Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of the Lender.

(b) Borrower Agreement. Subject to subsection (c) below, Borrowers shall, upon demand therefor as provided in subsection (a) above, immediately:

(i) repay the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document; and

(ii) Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof).

(c) Standstill Period. A demand made by the Lender for the repayment of Loans under subsection (a)(ii) or for the Cash Collateralization of the L/C Obligations under subsection (a)(iii) shall not be binding on any Borrower if:

(i) it is given because of the occurrence of an Event of Default specified in Section 5.10 of the Guaranty or Sections 9.01(c), 9.01(d), 9.01(f), 9.01(n), 9.01(q) or 9.01(x) of this Agreement; and

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(ii) within 2 Business Days of the notice the Company is able to demonstrate to the Lender’s absolute satisfaction (in the Lender’s sole and absolute discretion) that:

(A) the Event of Default did not occur or does not exist; or

(B) where the notice relates to an Event of Default specified in Section 9.01(x), the occurrence or existence of such Event of Default does not and will not have a Material Adverse Effect.

9.03 Application of Funds. After the exercise of remedies provided for in Section 9.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically been required to be Cash Collateralized as set forth in the proviso to Section 9.02(a)), any amounts received on account of the Obligations shall be applied by the Lender in such order as it elects in its sole discretion.

9.04 Review Event . If any securities of the Parent are added to the official list of any stock exchange (other than the official list of the Australian Securities Exchange operated by ASX Limited and the official list of the New York Stock Exchange), then the Lender may, for a period of not less than 60 days after the date the Lender is notified of that event (the “Listing Review Period”), review the terms of any Finance Debt provided under any Loan Document. Following the Listing Review Period the Lender may require repayment on demand of all or part of the Finance Debt provided to any Loan Party and terminate all its facilities, if the Lender, acting reasonably, believes that the Parent’s presence on the official list of such a stock exchange, will have, or is reasonably likely to have, a Material Adverse Effect.

ARTICLE X. MISCELLANEOUS

10.01 Amendments, Etc. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Company or any other Loan Party therefrom, shall be effective unless in writing signed by the Lender and the Company or the applicable Loan Party, as the case may be, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

10.02 Notices; Effectiveness; Electronic Communication.

(a) Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable address, telecopier number, electronic mail address or telephone number specified for notices to the applicable Person on Schedule 10.02. Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the

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recipient). Notices delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

(b) Electronic Communications. Notices and other communications to the Lender hereunder may be delivered or furnished by electronic communication (including e mail and Internet or intranet websites) pursuant to procedures approved by the Lender; provided that the foregoing shall not apply to notices to the Lender pursuant to Article II if the Lender has notified the Company that it is incapable of receiving notices under such Article by electronic communication. The Lender or the Company may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

Unless the Lender otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e- mail or other written acknowledgement); provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

(c) Change of Address, Etc. Each of the Borrowers and the Lender may change its address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto.

(d) Reliance by Lender. The Lender shall be entitled to rely and act upon any notices (including telephonic Loan Notices) purportedly given by or on behalf of any Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Company shall indemnify the Lender and its Related Parties from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of any Borrower. All telephonic notices to and other telephonic communications with the Lender may be recorded by the Lender, and each of the parties hereto hereby consents to such recording.

10.03 No Waiver; Cumulative Remedies. No failure by the Lender to exercise, and no delay by the Lender in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

10.04 Expenses; Indemnity; Damage Waiver.

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(a) Costs and Expenses. The Company shall pay (i) all reasonable out of pocket expenses incurred by the Lender and its Affiliates (including the reasonable fees, charges and disbursements of counsel for the Lender), in connection with the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out of pocket expenses incurred by the Lender in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out of pocket expenses incurred by the Lender (including the reasonable fees, charges and disbursements of any counsel for the Lender), and shall pay all fees and time charges for attorneys who may be employees of the Lender, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out of pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

(b) Indemnification by the Company. The Company shall indemnify the Lender and its Related Parties (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any third party or by any Borrower or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder, the consummation of the transactions contemplated hereby or thereby, or the administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the Lender to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by any Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to any Borrower or any of its Subsidiaries, or (iv) any actual or threatened claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Company or any other Loan Party, and regardless of whether any Indemnitee is a party thereto, in all cases, whether or not caused by or arising, in whole or in part, out of the comparative, contributory or sole negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the Company or any other Loan Party against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if the Company or such other Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.

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(c) Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, no Borrower shall assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

(d) Payments. All amounts due under this Section shall be payable not later than ten Business Days after demand therefor.

(e) Survival. The agreements in this Section shall survive the termination of the Commitment and the repayment, satisfaction or discharge of all the other Obligations.

10.05 Payments Set Aside. To the extent that any payment by or on behalf of any Borrower is made to the Lender, or the Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred.

10.06 Successors and Assigns.

(a) Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that neither any Borrower nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Lender and the Lender may not assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (c) of this Section, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (c) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of the Lender) any legal or equitable right, remedy or claim under or by reason of this Agreement.

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(b) Assignments by Lender. The Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of the Commitment, the Loans and L/C Obligations at the time owing to it) pursuant to documentation acceptable to the Lender and the assignee, it being understood and agreed that with respect to any Letters of Credit outstanding at the time of any such assignment, the Lender may sell to the assignee a ratable participation in such Letters of Credit. From and after the effective date specified in such documentation, such Eligible Assignee shall be a party to this Agreement and, to the extent of the interest assigned by the Lender, have the rights and obligations of the Lender under this Agreement, and the Lender shall, to the extent of the interest so assigned, be released from its obligations under this Agreement (and, in the case of an assignment of all of the Lender’s rights and obligations under this Agreement, shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 10.04 and 10.05 with respect to facts and circumstances occurring prior to the effective date of such assignment, and shall continue to have all of the rights provided hereunder to the Lender in its capacity as issuer of any Letters of Credit outstanding at the time of such assignment). Upon request, the Borrowers (at their expense) shall execute and deliver new or replacement Notes to the Lender and the assignee, and shall execute and deliver any other documents reasonably necessary or appropriate to give effect to such assignment and to provide for the administration of this Agreement after giving effect thereto.

(c) Participations. The Lender may at any time, without the consent of, or notice to, any Borrower, sell participations to any Person (other than a natural person or the Company or any of the Company’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of the Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the outstanding Letters of Credit and/or the Loans and/or the reimbursement obligations in respect of Letters of Credit); provided that (i) the Lender’s obligations under this Agreement shall remain unchanged, (ii) the Lender shall remain solely responsible to the Borrower for the performance of such obligations and (iii) the Borrower shall continue to deal solely and directly with the Lender in connection with the Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which the Lender sells such a participation shall provide that the Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that the Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification that would (i) postpone any date upon which any payment of money is scheduled to be made to such Participant, (ii) reduce the principal, interest, fees or other amounts payable to such Participant (provided, however, that the Lender may, without the consent of the Participant, (A) amend any financial covenant hereunder (or any defined term used therein) even if the effect of such amendment would be to reduce the rate of interest on any Loan or Letter of Credit reimbursement obligation or to reduce any fee payable hereunder and (B) waive the right to be paid interest at the Default Rate), or (iii) release the Parent from the Guaranty. Subject to subsection (d) of this Section, the Company agrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were the Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were the Lender.

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(d) Limitations Upon Participant Rights. A Participant shall not be entitled to receive any greater payment under Sections 3.01 or 3.04 than the Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Company’s prior written consent. A Participant that is not a “United States person” within the meaning of Section 7701(a)(30) of the Code shall not be entitled to the benefits of Section 3.01 unless the Company is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Company, to provide to the Lender such tax forms prescribed by the IRS as are necessary or desirable to establish an exemption from, or reduction of, U.S. withholding tax.

(e) Certain Pledges. The Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under the Note, if any) to secure obligations of the Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release the Lender from any of its obligations hereunder or substitute any such pledgee or assignee for the Lender as a party hereto.

10.07 Treatment of Certain Information; Confidentiality. The Lender agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to a Borrower and its obligations, (g) with the consent of the Company or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Lender or any of its Affiliates on a nonconfidential basis from a source other than the Company.

For purposes of this Section, “Information” means all information received from the Company or any Subsidiary relating to the Company or any Subsidiary or any of their respective businesses, other than any such information that is available to the Lender on a nonconfidential basis prior to disclosure by the Company or any Subsidiary; provided that, in the case of information received from the Company or any Subsidiary after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

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10.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, the Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by the Lender or any such Affiliate to or for the credit or the account of any Borrower or any other Loan Party against any and all of the obligations of such Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to the Lender, irrespective of whether or not the Lender shall have made any demand under this Agreement or any other Loan Document and although such obligations of such Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or office of the Lender different from the branch or office holding such deposit or obligated on such indebtedness. The rights of the Lender and its Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that the Lender or its Affiliates may have. The Lender agrees to notify the Company promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.

10.09 Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Company. In determining whether the interest contracted for, charged, or received by the Lender exceeds the Maximum Rate, the Lender may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

10.10 Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Lender and when the Lender shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

10.11 Survival of Representations and Warranties. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Lender, regardless of any investigation made by the Lender or on its behalf and notwithstanding that the Lender may have had notice or knowledge of any Default at the time of

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any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

10.12 Severability. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.13 Governing Law; Jurisdiction; Etc.

(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b) SUBMISSION TO JURISDICTION. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST ANY BORROWER OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT

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PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d) SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.14 Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

10.15 USA PATRIOT Act Notice. The Lender that is subject to the Act (as hereinafter defined) and the Lender hereby notifies the Borrowers that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrowers, which information includes the name and address of each Borrower and other information that will allow the Lender to identify such Borrower in accordance with the Act.

10.16 Time of the Essence. Time is of the essence of the Loan Documents.

10.17 Judgment Currency. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due hereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Lender could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The obligation of each Borrower in respect of any such sum due from it to Lender hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receipt by the Lender of any sum adjudged to be so due in the Judgment Currency, the Lender may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency. If the amount of the Agreement Currency so purchased is less than the sum originally due to the Lender from any Borrower in the Agreement Currency, such Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify

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the Lender against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Lender in such currency, the Lender agrees to return the amount of any excess to such Borrower (or to any other Person who may be entitled thereto under applicable law).

10.18 Amendment and Restatement. This Agreement shall become effective on the Closing Date and shall supersede all provisions of the Prior Credit Agreement as of such date. From and after the Closing Date all references made to the Prior Credit Agreement in any Loan Document or in any other instrument or document shall, without more, be deemed to refer to this Agreement.

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IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

SIMS GROUP USA HOLDINGS CORPORATION , formerly known as Sims Hugo Neu Corporation

By:

Name:

Title:

SIMS GROUP GLOBAL TRADE CORPORATION , successor by merger to Sims Hugo Neu Global Trade LLC

By: Name: Title:

HNE RECYCLING LLC

By: Name: Title:

HNW RECYCLING LLC

By: Name: Title:

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SIMSMETAL EAST LLC , successor to Sims Hugo Neu East (General Partnership)

By:

Name:

Title:

SIMSMETAL WEST LLC , successor to Sims Hugo Neu West (General Partnership)

By:

Name:

Title:

SIMS GROUP USA CORPORATION

By:

Name: Title:

METAL MANAGEMENT, INC.

By: Name: Title:

MM METAL DYNAMICS HOLDINGS, INC.

By: Name: Title:

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METAL MANAGEMENT MIDWEST, INC.

By:

Name: Title:

METAL MANAGEMENT OHIO, INC.

By: Name: Title:

SMM — NORTH AMERICA TRADE CORPORATION , formerly known as Metal Management S&A Holdings, Inc.

By: Name: Title:

METAL MANAGEMENT WEST COAST HOLDINGS, INC.

By:

Name:

Title:

METAL MANAGEMENT PROLER SOUTHWEST, INC.

By:

Name:

Title:

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PROLER SOUTHWEST GP, INC.

By:

Name: Title:

NAPORANO IRON & METAL, INC.

By: Name: Title:

METAL MANAGEMENT NORTHEAST, INC.

By: Name: Title:

METAL MANAGEMENT NEW HAVEN, INC.

By: Name: Title:

CIM TRUCKING, INC.

By: Name: Title:

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METAL MANAGEMENT ALABAMA, INC.

By:

Name: Title:

METAL MANAGEMENT ARIZONA, L.L.C.

By: Name: Title:

METAL MANAGEMENT CONNECTICUT, INC.

By: Name: Title:

METAL MANAGEMENT INDIANA, INC.

By: Name: Title:

METAL MANAGEMENT MEMPHIS, L.L.C.

By: Name: Title:

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METAL MANAGEMENT MISSISSIPPI, INC.

By:

Name: Title:

METAL MANAGEMENT PITTSBURGH, INC.

By: Name: Title:

METAL MANAGEMENT WEST, INC.

By: Name: Title:

NEW YORK RECYCLING VENTURES, INC.

By: Name: Title:

PROLER SOUTHWEST LP

By: Name: Title:

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RESERVE IRON & METAL LIMITED PARTNERSHIP

By: Name: Title:

METAL DYNAMICS LLC

By: Name: Title:

METAL DYNAMICS DETROIT LLC

By: Name: Title:

METAL DYNAMICS INDIANAPOLIS LLC

By: Name: Title:

BANK OF AMERICA, N.A.

By: Name: Title:

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SCHEDULE 1.01

MANDATORY COST FORMULAE

1. The Mandatory Cost (to the extent applicable) is an addition to the interest rate to compensate the Lender for the cost of compliance with:

2. (a) the requirements of the Bank of England and/or the Financial Services Authority (or, in either case, any other authority which replaces all or any of its functions); or

3. (b) the requirements of the European Central Bank.

4. On the first day of each Interest Period (or as soon as possible thereafter) the Lender shall calculate, as a percentage rate, a rate (the “Additional Cost Rate”) in accordance with the paragraphs set out below. The Mandatory Cost will be calculated by the Lender as a weighted average of the Lender’s Additional Cost Rates and will be expressed as a percentage rate per annum. The Lender will, at the request of the Company, deliver to the Company a statement setting forth the calculation of any Mandatory Cost.

5. The Additional Cost Rate for the Lender lending from a Lending Office in a Participating Member State will be its reasonable determination of the cost (expressed as a percentage of the Lender’s participation in all Loans made from such Lending Office) of complying with the minimum reserve requirements of the European Central Bank in respect of Loans made from that Lending Office.

6. The Additional Cost Rate for the Lender lending from a Lending Office in the United Kingdom will be calculated by the Lender as follows:

7. (a) in relation to any Loan in Sterling:

==> picture [220 x 25] intentionally omitted <==

• (b) in relation to any Loan in any currency other than Sterling:

==> picture [220 x 22] intentionally omitted <==

Where:

• “A” is the percentage of Eligible Liabilities (assuming these to be in excess of any stated minimum) which that the Lender is from time to time required to maintain as an interest free cash ratio deposit with the Bank of England to comply with cash ratio requirements.

• “B” is the percentage rate of interest (excluding the Applicable Margin, the Mandatory Cost and any interest charged on overdue amounts pursuant to the first sentence

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of Section 2.07(b) and, in the case of interest (other than on overdue amounts) charged at the Default Rate, without counting any increase in interest rate effected by the charging of the Default Rate) payable for the relevant Interest Period of such Loan.

• “C” is the percentage (if any) of Eligible Liabilities which that the Lender is required from time to time to maintain as interest bearing Special Deposits with the Bank of England.

• “D” is the percentage rate per annum payable by the Bank of England to the Lender on interest bearing Special Deposits.

• “E” is designed to compensate the Lender for amounts payable under the Fees Rules and is calculated by the Lender as being the average of the most recent rates of charge supplied by the Lenders pursuant to paragraph 7 below and expressed in pounds per £1,000,000.

• For the purposes of this Schedule:

• (a) “Eligible Liabilities” and “Special Deposits” have the meanings given to them from time to time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank of England;

• (b) “Fees Rules” means the rules on periodic fees contain in the FSA Supervision Manual or such other law or regulation as may be in force from time to time in respect of the payment of fees for the acceptance of deposits;

• (c) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under the activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee required pursuant to the Fees Rules but taking into account any applicable discount rate); and

• (d) “Tariff Base” has the meaning given to it in, and will be calculated in accordance with, the Fees Rules.

• In application of the above formulae, A, B, C and D will be included in the formulae as percentages (i.e. 5% will be included in the formula as 5 and not as 0.05). A negative result obtained by subtracting D from B shall be taken as zero. The resulting figures shall be rounded to four decimal places.

• If requested by the Company, the Lender shall, as soon as practicable after publication by the Financial Services Authority, supply to the Company, the rate of charge payable by the Lender to the Financial Services Authority pursuant to the Fees Rules in respect of the relevant financial year of the Financial Services Authority (calculated for this purpose by the Lender as being the average of the Fee Tariffs applicable to the Lender for that financial year) and expressed in pounds per £1,000,000 of the Tariff Base of the Lender.

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1. The Lender shall supply any information required for the purpose of calculating its Additional Cost Rate. In particular, but without limitation, the Lender shall supply the following information in writing:

2. (a) the jurisdiction of the Lending Office out of which it is making available its participation in the relevant Loan; and

3. (b) any other information reasonably required for such purpose.

4. The percentages of the Lender for the purpose of A and C above and the rates of charge of the Lender for the purpose of E above shall be determined based upon the information supplied pursuant to paragraphs 7 and 8 above and on the assumption that, the Lender’s obligations in relation to cash ratio deposits and Special Deposits are the same as those of a typical bank from its jurisdiction of incorporation with a Lending Office in the same jurisdiction as its Lending Office.

5. Any determination by the Lender pursuant to this Schedule in relation to a formula, the Mandatory Cost, an Additional Cost Rate or any amount payable to the Lender shall, in the absence of manifest error, be conclusive and binding on all parties hereto.

6. The Lender may from time to time, after consultation with the Company, determine and notify to all parties any amendments which are required to be made to this Schedule in order to comply with any change in law, regulation or any requirements from time to time imposed by the Bank of England, the Financial Services Authority or the European Central Bank (or, in any case, any other authority which replaces all or any of its functions) and any such determination shall, in the absence of manifest error, be conclusive and binding on all parties hereto.

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SCHEDULE 5.12

SUBSIDIARIES, OTHER EQUITY INVESTMENTS AND EQUITY INTERESTS IN THE BORROWERS

Part (a). Subsidiaries.

• Borrower Subsidiary

• 1. Sims Group USA Holdings SHN Co., LLC Corporation HNE Recycling LLC

Ownership of Subsidiaries Sims Group USA Holdings Corporation (100%)

Sims Group USA Holdings Corporation (100%)

Sims Group USA Corporation

Sims Group USA Holdings Corporation (100%)

HNW Recycling LLC

SHN Co., LLC (100%)

Sims Group Global Trade HNE Recycling LLC (100%) Corporation Simsmetal West LLC HNW Recycling LLC (50%), HNE Recycling LLC (50%) Simsmetal East LLC HNW Recycling LLC (50%), HNE Recycling LLC (50%) Dover Barge Company HNW Recycling LLC (50%), HNE Recycling LLC (50%) North Carolina Resource HNW Recycling LLC (50%), Conservation LLC HNE Recycling LLC (50%) Schiabo Larovo Corporation Simsmetal East LLC (100%) 2. Sims Group Global Trade None N/A Corporation 3. HNE Recycling LLC Sims Group Global Trade HNE Recycling LLC (100%) Corporation 4. HNW Recycling LLC None N/A 5. Simsmetal East LLC Schiabo Larovo Corporation Simsmetal East LLC (100%) 6. Simsmetal West LLC None N/A 7. Sims Group USA Corporation None N/A 8. Metal Management, Inc. MM Metal Dynamics Holdings, Inc. Metal Management, Inc. (100%) Metal Management Midwest, Inc. Metal Management, Inc. (100%) Metal Management Ohio, Inc. Metal Management, Inc. (100%) SMM — North America Trade Corporation Metal Management, Inc. (100%)

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Borrower

Subsidiary

Ownership of Subsidiaries Metal Management, Inc. (100%)

Metal Management West Coast Holdings, Inc.

Metal Management Proler Southwest, Inc. Metal Management, Inc. (100%) Proler Southwest GP, Inc. Metal Management, Inc. (100%) Naporano Iron & Metal, Inc. Metal Management, Inc. (100%) Metal Management Northeast, Inc. Metal Management, Inc. (100%) Metal Management New Haven, Inc. Metal Management, Inc. (100%) CIM Trucking, Inc. Metal Management Midwest, Inc. (100%) Metal Management Aerospace, SMM — North America Trade Inc. Corporation (100%) Metal Management Alabama, Inc. Proler Southwest LP (100%) Metal Management Arizona, Metal Management West Coast L.L.C. Holdings, Inc. (100%) Metal Management Connecticut, Metal Management Northeast, Inc. Inc. (100%) Metal Management Indiana, Inc. Metal Management Midwest, Inc. (100%) Metal Management Memphis, Metal Management Midwest, L.L.C. Inc. (100%) Metal Management Mississippi, Inc. Proler Southwest LP (100%) Metal Management Pittsburgh, SMM — North America Trade Inc. Corporation (100%) Metal Management West, Inc. Metal Management West Coast

Metal Management West Coast Holdings, Inc. (100%)

New York Recycling Ventures, Metal Management Northeast, Inc. Inc. (100%) Proler Southwest LP

Metal Management Proler Southwest, Inc. (99%) (LP) Proler Southwest GP, Inc. (1%) (GP)

Metal Management, Inc. (75%) (LP)

Reserve Iron & Metal Limited Partnership Metal Dynamics LLC

Metal Management Ohio, Inc. (25%) (GP)

MM Metal Dynamics Holdings, Inc. (100%)

Metal Dynamics Detroit LLC

Metal Dynamics LLC (100%)

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			Ownership of Subsidiaries Metal Dynamics LLC (100%) MM Metal Dynamics Holdings, Inc. (100%) Metal Dynamics LLC (100%) Metal Dynamics LLC (100%) Metal Management Midwest, Inc. (100%) Metal Management Midwest, Inc. (100%) Metal Management Midwest, Inc. (100%) Metal Management, Inc. (75%) (LP) Metal Management Ohio, Inc. (25%) (GP) SMM — North America Trade Corporation (100%) SMM — North America Trade Corporation (100%) Metal Management West Coast Holdings, Inc. (100%) Metal Management West Coast Holdings, Inc. (100%) Metal Management Proler Southwest, Inc. (99%) (LP) Proler Southwest GP, Inc. (1%) (GP) Proler Southwest LP (100%) Proler Southwest LP (100%) Metal Management Proler Southwest, Inc. (99%) (LP) Proler Southwest GP, Inc. (1%) (GP) Proler Southwest LP (100%) Proler Southwest LP (100%) N/A Metal Management Northeast, Inc. (100%)
9. 10. 11. 12. 13. 14. 15. 16. 17.	Borrower MM Metal Dynamics Holdings, Inc. Metal Management Midwest, Inc. Metal Management Ohio, Inc. SMM — North America Trade Corporation Metal Management West Coast Holdings, Inc. Metal Management Proler Southwest, Inc. Proler Southwest GP, Inc. Naporano Iron & Metal, Inc. Metal Management Northeast, Inc.	Subsidiary Metal Dynamics Indianapolis LLC Metal Dynamics LLC Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC CIM Trucking, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Reserve Iron & Metal Limited Partnership Metal Management Aerospace, Inc. Metal Management Pittsburgh, Inc. Metal Management Arizona, L.L.C. Metal Management West, Inc. Proler Southwest LP Metal Management Mississippi, Inc. Metal Management Alabama, Inc. Proler Southwest LP Metal Management Alabama, Inc. Metal Management Mississippi, Inc. None Metal Management Connecticut, Inc.

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Part 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 1. 2. 3.	(b).Other Equity Investments . Borrower Metal Management New Haven, Inc. CIM Trucking, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Metal Management Mississippi, Inc. Metal Management Pittsburgh, Inc. Metal Management West, Inc. New York Recycling Ventures, Inc. Proler Southwest LP Reserve Iron & Metal Limited Partnership Metal Dynamics LLC Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC Borrower Sims Group USA Holdings Corporation Sims Group Global Trade Corporation HNE Recycling LLC	Subsidiary Ownership of Subsidiaries New York Recycling Ventures, Inc. Metal Management Northeast, Inc. (100%) None N/A None N/A None N/A None N/A None N/A None N/A None N/A None N/A None N/A None N/A None N/A Metal Management Alabama, Inc. Proler Southwest LP (100%) Metal Management Mississippi, Inc. Proler Southwest LP (100%) None N/A None N/A None N/A None N/A Other Entities (% owned by Borrower) None None Dover Barge Company (50%) Simsmetal East LLC (50%) North Carolina Resource Conservation LLC (50%) Simsmetal West LLC (50%)	Ownership of Subsidiaries
			Metal Management Northeast, Inc. (100%) N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Proler Southwest LP (100%) Proler Southwest LP (100%) N/A N/A N/A N/A

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4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27.	[*] Borrower HNW Recycling LLC Simsmetal East LLC Simsmetal West LLC Sims Group USA Corporation Metal Management, Inc. MM Metal Dynamics Holdings, Inc. Metal Management Midwest, Inc. Metal Management Ohio, Inc. SMM — North America Trade Corporation Metal Management West Coast Holdings, Inc. Metal Management Proler Southwest, Inc. Proler Southwest GP, Inc. Naporano Iron & Metal, Inc. Metal Management Northeast, Inc. Metal Management New Haven, Inc. CIM Trucking, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Metal Management Mississippi, Inc. Metal Management Pittsburgh, Inc. Metal Management West, Inc.	Other Entities (% owned by Borrower)
		Confidential Treatment Requested Dover Barge Company (50%) Simsmetal East LLC (50%) North Carolina Resource Conservation LLC (50%) Simsmetal West LLC (50%) None SA Recycling LLC (50%) None None None Rondout Iron & Metal Company, LLC (50%) Metal Management Nashville, LLC (50%) None None None None None Port Albany Ventures LLC (50%) None None None None None None None None None None None

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Part (c).Owners of Equity Interests in the Borrowers . Borrower 28. New York Recycling Ventures, Inc. 29. Proler Southwest LP 30. Reserve Iron & Metal Limited Partnership 31. Metal Dynamics LLC 32. Metal Dynamics Detroit LLC 33. Metal Dynamics Indianapolis LLC Borrower 1. Sims Group USA Holdings Corporation 2. Sims Group Global Trade Corporation 3. HNE Recycling LLC 4. HNW Recycling LLC 5. Simsmetal East LLC 6. Simsmetal West LLC 7. Sims Group USA Corporation 8. Metal Management, Inc. 9. MM Metal Dynamics Holdings, Inc. 10 Metal Management Midwest, Inc. 11. Metal Management Ohio, Inc. 12. SMM — North America Trade Corporation 13. Metal Management West Coast Holdings, Inc. 14. Metal Management Proler Southwest, Inc. 15. Proler Southwest GP, Inc. 16. Naporano Iron & Metal, Inc. 17. Metal Management Northeast, Inc.	Other Entities (% owned by Borrower)
	None None None None None None Parent (% owned by Parent)
	Sims Metal Management Limited (100%) HNE Recycling LLC (100%) Sims Group USA Holdings Corporation (100%) SHN Co., LLC (100%) HNE Recycling LLC (50%) HNW Recycling LLC (50%) HNE Recycling LLC (50%) HNW Recycling LLC (50%) Sims Group USA Holdings Corporation (100%) Sims Metal Management Limited (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%) Metal Management, Inc. (100%)

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18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33.	Borrower Metal Management New Haven, Inc. CIM Trucking, Inc. Metal Management Alabama, Inc. Metal Management Arizona, L.L.C. Metal Management Connecticut, Inc. Metal Management Indiana, Inc. Metal Management Memphis, L.L.C. Metal Management Mississippi, Inc. Metal Management Pittsburgh, Inc. Metal Management West, Inc. New York Recycling Ventures, Inc. Proler Southwest LP Reserve Iron & Metal Limited Partnership Metal Dynamics LLC Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC	Parent (% owned by Parent)
		Metal Management, Inc. (100%) Metal Management Midwest, Inc. (100%) Proler Southwest LP (100%) Metal Management West Coast Holdings, Inc. (100%) Metal Management Northeast, Inc. (100%) Metal Management Midwest, Inc. (100%) Metal Management Midwest, Inc. (100%) Proler Southwest LP (100%) SMM — North America Trade Corporation (100%) Metal Management West Coast Holdings, Inc. (100%) Metal Management Northeast, Inc. (100%) Metal Management Proler Southwest, Inc. (99%) (LP) Proler Southwest GP, Inc. (1%) (GP) Metal Management, Inc. (75%) (LP) Metal Management Ohio, Inc. (25%) (GP) MM Metal Dynamics Holdings, Inc. (100%) Metal Dynamics LLC (100%) Metal Dynamics LLC (100%)

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SCHEDULE 10.02

LENDER’S OFFICE; CERTAIN ADDRESSES FOR NOTICES

COMPANY and DESIGNATED BORROWERS:

Sims Group USA Holdings Corporation 110 5th Avenue, Suite 700 New York, New York 10011

Attention: Myles Partridge EVP and CFO Telephone: (212) 500-7507 Telecopier: (212) 604-0722 Electronic Mail: mpartridge@us.sims-group.com Website Address: www.sims-group.com

U.S. Taxpayer Identification Number(s):

Sims Group USA Holdings Corporation	20-3622384
Sims Group Global Trade Corporation	20-8474694
HNE Recycling LLC	42-1682531
HNW Recycling LLC	20-2880190
SimsMetal East LLC	20-8484120
SimsMetal West LLC	20-8484184
Sims Group USA Corporation	94-3053218
Metal Management, Inc.	94-2835068
MM Metal Dynamics Holdings, Inc.	20-8828154
Metal Management Midwest, Inc.	36-2582686
Metal Management Ohio, Inc.	34-0901723
SMM — North America Trade Corporation	25-1619177
Metal Management West Coast Holdings, Inc.	36-4325792
Metal Management Proler Southwest, Inc.	35-2265134
Proler Southwest GP, Inc.	20-3916027
Naporano Iron & Metal, Inc.	36-4325790
Metal Management Northeast, Inc.	22-1449923
Metal Management New Haven, Inc.	36-4345073
CIM Trucking, Inc.	36-4035047
Metal Management Alabama, Inc.	36-4218674
Metal Management Arizona, L.L.C.	86-0819529
Metal Management Connecticut, Inc.	06-1516622
Metal Management Indiana, Inc.	36-3197180
Metal Management Memphis, L.L.C.	62-1600547
Metal Management Mississippi, Inc.	76-0570379
Metal Management Pittsburgh, Inc.	36-4235943
Metal Management West, Inc.	84-0888787

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New York Recycling Ventures, Inc.	20-5968735
Proler Southwest LP	36-4169987
Reserve Iron & Metal Limited Partnership	34-1658201
Metal Dynamics LLC	74-3161971
Metal Dynamics Detroit LLC	20-8827974
Metal Dynamics Indianapolis LLC	20-8828030

LENDER:

Lender’s Office (for payments and Requests for Credit Extensions):

Bank of America, N.A. 2001 Clayton Rd CA4-702-02-25 Concord, CA 94520

Attention: Chris P Potter Telephone: (925) 675-8027 Telecopier: (888) 969-2419 Electronic chris.p.potter@bankofamerica.com Mail:

Lender’s Domestic Wire Instructions

Bank Name: Bank of America NA NY NY ABA/Routing No.: 026009593 Account Name: Credit Services West Account No.: 3750836479 Attention: Chris P Potter Reference: Sims Group USA Holdings Corporation

Lender’s Foreign Wire Instructions

Currency: Australian Dollars (AUD) Bank Name: Bank of America Sydney Swift/Routing No.: BOFAAUSX Account Name: Grand Cayman Unit #1207 Account No.: 96272016 Attention: Grand Cayman Unit #1207 Reference: Sims Group USA Holdings Corporation

Lender’s Foreign Wire Instructions

Currency: Euro Currency (EUR) Bank Name: Bank of America London Swift/Routing No.: BOFAGB22 Account Name: Grand Cayman Unit #1207 Account No.: 96272019 Attention: Grand Cayman Unit #1207 Reference: Sims Group USA Holdings Corporation

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Lender’s Foreign Wire Instructions

Currency: British Pounds Sterling (GBP) Bank Name: Bank of America London Swift/Routing No.: BOFAGB22 Account Name: Grand Cayman Unit #1207 Account No.: 96272027 FFC Account Name: Sort Code 16-50-50 Attention: Grand Cayman Unit #1207 Reference: Sims Group USA Holdings Corporation

Lender’s Foreign Wire Instructions

Currency: Japanese Yen (JPY) Bank Name: Bank of America Tokyo Swift/Routing No.: BOFAJPJX Account Name: Grand Cayman Unit #1207 Account No.: 96272011 Attention: Grand Cayman Unit #1207 Reference: Sims Group USA Holdings Corporation

Other Notices as Lender:

Bank of America, N.A. Commercial Banking Mail Code: WA1-501-36-06 800 Fifth Avenue, Floor 36 Seattle, WA 98104

Attention: Timothy G. Holsapple Senior Vice President Telephone: (206) 358-3130 Facsimile: (206) 358-3971 Electronic Mail: tim.holsapple@bankamerica.com

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EXHIBIT A

FORM OF LOAN NOTICE

Date: , _____

To: Bank of America, N.A.

Ladies and Gentlemen:

Reference is made to that certain Amended and Restated Credit Agreement, dated as of November 2, 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Sims Group USA Holdings Corporation, formerly known as Sims Hugo Neu Corporation, a Delaware corporation (the “Company”), the Designated Borrowers from time to time party thereto, and Bank of America, N.A..

The Company hereby requests, on behalf of itself or, if applicable, the Designated Borrower referenced in item 6 below (the “Applicable Designated Borrower”) (select one):

• A Borrowing of Loans � A conversion or continuation of Loans

• On (a Business Day).

• In the amount of $

• .

• Comprised of . [Type of Loan requested]

• In the following currency:

• .

• For Eurocurrency Fixed Rate Loans: with an Interest Period of ___months.

• On behalf of [insert name of applicable Designated Borrower].

The Borrowing, if any, requested herein complies with the provisos to the first sentence of Section 2.01 of the Agreement.

SIMS GROUP USA HOLDINGS

CORPORATION , formerly known as Sims Hugo Neu Corporation

By:

Name:

Title:

[*] Confidential Treatment Requested

1

EXHIBIT B

FORM OF NOTE

$___,000,000

[ , ___]

FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to Bank of America, N.A., a national banking association, or assigns (the “Lender”), in accordance with the provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time to time made by the Lender to the Borrower under that certain Amended and Restated Credit Agreement, dated as of November 2, 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among Sims Group USA Holdings Corporation, a Delaware corporation, formerly known as Sims Hugo Neu Corporation, the Designated Borrowers from time to time party thereto, and the Lender.

The Borrower promises to pay interest on the unpaid principal amount of each Loan from the date of such Loan until such principal amount is paid in full, at such interest rates and at such times as provided in the Agreement. All payments of principal and interest shall be made to the Lender in the currency in which such Loan was denominated and in Same Day Funds at the Lending Office for such currency. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement.

This Note is one of the Notes referred to in the Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided therein. This Note is also entitled to the benefits of the Guaranty. Upon the occurrence and continuation of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Agreement. Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount, currency and maturity of its Loans and payments with respect thereto.

The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note.

[Remainder of page intentionally left blank]

[*] Confidential Treatment Requested

1

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

[BORROWER / APPLICABLE DESIGNATED BORROWER]

By: Name: Title:

[*] Confidential Treatment Requested

2

EXHIBIT C

[FORM OF GUARANTY]

[*] Confidential Treatment Requested

1

EXHIBIT D

FORM OF DESIGNATED BORROWER REQUEST AND ASSUMPTION AGREEMENT

Date: , _____

To: Bank of America, N.A.

Ladies and Gentlemen:

This Designated Borrower Request and Assumption Agreement is made and delivered pursuant to Section 2.12 of that certain mended and Restated Credit Agreement, dated as of November 2, 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Sims Group USA Holdings Corporation, a Delaware corporation, formerly known as Sims Hugo Neu Corporation (the “Company”), the Designated Borrowers from time to time party thereto, and Bank of America, N.A. (the “Lender”), and reference is made thereto for full particulars of the matters described therein. All capitalized terms used in this Designated Borrower Request and Assumption Agreement and not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement.

Each of (the “Designated Borrower”) and the Company hereby confirms, represents and warrants to the Lender that the Designated Borrower is a Domestic Affiliate.

The documents required to be delivered to the Lender under Section 2.12 of the Credit Agreement will be furnished to the Lender in accordance with the requirements of the Credit Agreement.

The true and correct U.S. taxpayer identification number of the Designated Subsidiary is .

The parties hereto hereby confirm that with effect from the date hereof, the Designated Borrower shall have obligations, duties and liabilities toward each of the other parties to the Credit Agreement identical to those which the Designated Borrower would have had if the Designated Borrower had been an original party to the Credit Agreement as a Borrower. The Designated Borrower confirms its acceptance of, and consents to, all representations and warranties, covenants, and other terms and provisions of the Credit Agreement.

The parties hereto hereby request that the Designated Borrower be entitled to receive Loans under the Credit Agreement, and understand, acknowledge and agree that neither the Designated Borrower nor the Company on its behalf shall have any right to request any Loans for its account unless and until the date five Business Days after the effective date designated by the Lender in a Designated Borrower Notice delivered to the Company pursuant to Section 2.12 of the Credit Agreement.

[*] Confidential Treatment Requested

2

This Designated Borrower Request and Assumption Agreement shall constitute a Loan Document under the Credit Agreement.

THIS DESIGNATED BORROWER REQUEST AND ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

IN WITNESS WHEREOF , the parties hereto have caused this Designated Borrower Request and Assumption Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

[DESIGNATED BORROWER]

By: Name: Title:

SIMS GROUP USA HOLDINGS CORPORATION , formerly known as Sims Hugo Neu Corporation By: Name: Title:

[*] Confidential Treatment Requested

3

EXHIBIT E

FORM OF DESIGNATED BORROWER NOTICE

Date: , _____

To: Sims Group USA Holdings Corporation

Ladies and Gentlemen:

This Designated Borrower Notice is made and delivered pursuant to Section 2.12 of that certain Amended and Restated Credit Agreement, dated as of November 2, 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Sims Group USA Holdings Corporation, a Delaware corporation, formerly known as Sims Hugo Neu Corporation (the “Company”), the Designated Borrowers from time to time party thereto, and Bank of America, N.A. (the “Lender”), and reference is made thereto for full particulars of the matters described therein. All capitalized terms used in this Designated Borrower Notice and not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement.

The Lender hereby notifies Company that effective as of the date hereof shall be a Designated Borrower and may receive Loans for its account on the terms and conditions set forth in the Credit Agreement.

This Designated Borrower Notice shall constitute a Loan Document under the Credit Agreement.

BANK OF AMERICA, N.A.

By:

Name:

Title:

[*] Confidential Treatment Requested

1

EX-4.19 c53813exv4w19.htm EX-4.19

Exhibit 4.19

AMENDED AND RESTATED DEED POLL OF CONTINUING GUARANTY

Dated as of November 2, 2009

by SIMS METAL MANAGEMENT LIMITED,

as Guarantor, BANK OF AMERICA, N.A.

as Lender

==> picture [148 x 38] intentionally omitted <==

TABLE OF CONTENTS

Section ARTICLE I. DEFINITIONS AND INTERPRETIVE PROVISIONS 1.01 Terms Defined in Credit Agreement 1.02 Certain Defined Terms 1.03 Interpretive Provisions 1.04 Accounting Terms 1.05 Rounding ARTICLE II. GUARANTY 2.01 Guaranty 2.02 Liability of Guarantor Absolute 2.03 Waivers by Guarantor 2.04 Void or Voidable Transactions 2.05 Indemnity 2.06 Guarantor’s Rights of Subrogation, Contribution, Etc 2.07 Subordination of Other Obligations 2.08 Continuing Guaranty 2.09 Authority of Borrowers 2.10 Information 2.11 Right of Setoff 2.12 Bankruptcy; Post-Petition Interest; Reinstatement of Guaranty ARTICLE III. TAXES 3.01 Payments Free of Taxes 3.02 Payment of Other Taxes by Guarantor 3.03 Indemnification by the Guarantor 3.04 Evidence of Payment 3.05 Treatment of Certain Refunds ARTICLE IV. REPRESENTATIONS AND WARRANTIES 4.01 Existence, Qualification and Power 4.02 Authorization; No Contravention 4.03 Governmental Authorization; Other Consents 4.04 Commercial Acts; No Immunity 4.05 Binding Effect 4.06 Latest Audited Financial Statements; No Material Adverse Effect 4.07 Litigation 4.08 No Default 4.09 Environmental Compliance 4.10 Compliance with Laws 4.11 Identifying Information 4.12 Solvency 4.13 Material Credit Agreements 4.14 Benefit 4.15 Guarantor Not a Trustee 4.16 No Benefit to Related Party 4.17 Disclosure

Page

2 2 2 10 10 10 11 11 11 13 13 14 14 15 15 15 15 16 16 17 17 17 17 17 18 18 18 18 19 19 19 19 19 20 20 20 20 20 20 20 20 20 21

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Section 4.18 Repeat of Representations and Warranties 4.19 Reliance 4.20 No Filing or Stamp Taxes 4.21 Taxation 4.22 Pari Passu 4.23 Governing Law and Enforcement 4.24 Legal and Beneficial Owner 4.25 Full Disclosure 4.26 Most Favored Nation 4.27 Representations True ARTICLE V. AFFIRMATIVE COVENANTS 5.01 Financial Statements 5.02 Certificates; Other Information 5.03 Notices 5.04 Payment of Obligations 5.05 Preservation of Existence, Etc 5.06 Maintenance of Properties; Conduct of Business; Insurance 5.07 Compliance with Laws 5.08 Books and Records 5.09 Approvals and Authorizations 5.10 Financial Covenants 5.11 Most Favored Nations Status ARTICLE VI. NEGATIVE COVENANTS 6.01 Liens 6.02 Fundamental Changes 6.03 Dispositions 6.04 Change in Nature of Business 6.05 Finance Debt 6.06 Negative Pledge 6.07 Swap Contracts ARTICLE VII. MISCELLANEOUS 7.01 No Waiver; Cumulative Remedies 7.02 Costs and Expenses 7.03 Notices 7.04 Dispute Resolution 7.05 Payment by Guarantor; Application of Payments 7.06 Assignments, Participations, Confidentiality 7.07 Loan Document 7.08 Governing Law; Jurisdiction; Etc 7.09 Waiver of Jury Trial 7.10 USA PATRIOT Act Notice 7.11 Amendments, Etc 7.12 Integration; Effectiveness 7.13 Severability 7.14 No Inconsistent Requirements 7.15 Judgment Currency 7.16 Amendment and Restatement 7.17 Consideration

Page

21 21 21 21 21 21 21 21 22 22 22 22 22 23 23 23 23 24 24 24 25 25 25 25 26 26 26 26 26 27 27 27 27 27 28 30 31 31 31 32 32 32 32 32 33 33 33 33

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AMENDED AND RESTATED DEED POLL OF CONTINUING GUARANTY

This AMENDED AND RESTATED DEED POLL OF CONTINUING GUARANTY (“Guaranty”) is entered into as of November 2, 2009, made by SIMS METAL MANAGEMENT LIMITED, ABN 69 114 838 630, a corporation incorporated in the State of Victoria, Commonwealth of Australia (the “Guarantor”), in favor of BANK OF AMERICA, N.A., a national banking association (the “Lender”).

RECITALS

A. Sims Group USA Holdings Corporation, a Delaware corporation (the “Company”), the Designated Borrowers from time to time party thereto (together with the Company, collectively, the “Borrowers” individually, a “Borrower”), and the Lender are parties to that certain Credit Agreement dated September 12, 2006 (as amended, supplemented or otherwise modified, the “Prior Credit Agreement”) pursuant to which the Lender has committed, subject to the terms and conditions therein set forth, to make Credit Extensions to the Borrowers.

B. In connection with, and as a condition precedent to the Lender’s obligation to make the initial Credit Extension under the Prior Credit Agreement, the Guarantor entered into that certain Deed Poll of Continuing Guaranty dated September 12, 2006 (as amended, supplemented or otherwise modified, the “Prior Guaranty”) pursuant to which, among other things, the Guarantor guaranteed all advances to, and debts, liabilities, obligations, covenants and duties of, the Borrowers owing to the Lender arising under the Prior Credit Agreement.

C. Borrowers and the Lender intend to become parties to that certain Amended and Restated Credit Agreement dated or to be dated on or about November 2, 2009 (as amended, restated, supplemented or otherwise modified, the “Credit Agreement”) pursuant to which the Lender has committed or will commit, subject to the terms and conditions therein set forth, to make Credit Extensions to the Borrowers.

D. It is a condition precedent to the Lender’s obligation to make the initial Credit Extension under the Credit Agreement that the Guarantor enter into this Guaranty.

E. The Guarantor, as the direct or indirect parent of each Borrower, will derive substantial and direct benefits (which benefits are hereby acknowledged by the Guarantor) from the Credit Extensions and other benefits to be provided to the Borrowers under the Credit Agreement.

THIS DEED POLL WITNESSES

NOW, THEREFORE, in consideration of the foregoing and in order to induce the Lender to make Credit Extensions under the Credit Agreement, the parties hereto agree to amend and restate the Prior Guaranty as follows:

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ARTICLE I. DEFINITIONS AND INTERPRETIVE PROVISIONS

1.01 Terms Defined in Credit Agreement. All capitalized terms used in this Guaranty and not otherwise defined herein have the meanings specified in the Credit Agreement.

1.02 Certain Defined Terms. As used in this Guaranty, the following terms have the following meanings:

• “ACDC” means Australian Commercial Disputes Centre Limited.

“ACDC Guidelines for Expert Determination” means the ACDC Guidelines for Expert Determination (or, if the ACDC ceases to exist, the guidelines for expert determination of any similar organization nominated by the Law Society of NSW) in force from time to time.

“Acquisition” means the acquisition of substantially all of the recycling operations of Hugo Neu Corporation as outlined in the Project Old Update to Information Memorandum dated June 15, 2005.

“AUD” and “AU$” mean lawful money of Australia.

“Calculation Date” means 30 June and 31 December of each year.

“Calculation Period” means each period of 12 months ending on a Calculation Date.

“Compliance Certificate” means a certificate substantially in the form of Exhibit A.

“Dispute” has the meaning given to it in Section 7.04(d).

• “EBITDA” means for a relevant period and in respect of the Sims Group, the profit on ordinary activities before:

• (a) taxation;

• (b) Net Interest Expense; and

• (c) amortization of intangible assets and depreciation of tangible assets of the Sims Group,

as shown on a consolidated basis and as disclosed in the Sims Group’s most recent audited consolidated annual financial reports or semiannual audited or unaudited consolidated financial reports, as applicable.

For the purposes of calculating EBITDA, the calculation will exclude:

• (i) any significant non-cash items or items disclosed as required by AASB 101.97 and AASB 101.98 due to their size or nature or by the corresponding provisions of future revisions of this accounting standard, that are of a non-recurring nature including but not limited to:

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• (A) losses or gains on the sale or revaluation of assets;

• (B) costs relating to restructuring and redundancy;

• (C) discontinued operations;

• (D) discounts on acquisition and gains on formation of joint ventures;

• (E) post acquisition adjustments to contingent liabilities recorded on the date of a business acquisition pursuant to purchase accounting rule changes to be introduced on 1 July 2009; and

• (F) costs associated with becoming Sarbanes-Oxley Act compliant (as required following Sims Group’s registration as an issuer in the United States of America);

• (ii) significant unrealized gains or losses;

• (iii) any other significant non-cash items or items including but not limited to:

• (A) write downs of inventory to net realizable value;

• (B) revaluation increments to inventory; and

• (C) forgone profit arising from sales contract negotiations; and

• (iv) any impairment charge or loss (or gain or reversal) relating to the recoverable amount of assets (including any impairment charge relating to goodwill or identified intangible assets),

that are of a non-recurring nature.

The foregoing adjustments to EBITDA in paragraphs (i) to (iii) for each Calculation Period will be agreed by the Lender and the Guarantor in writing prior to the end of that Calculation Period, subject to the operation of Section 7.04.

Except for the purpose of calculating the ratio of Net Interest Expense to EBITDA, EBITDA as calculated on any Calculation Date will be adjusted to take into account the effects of any acquisitions or disposals of any company or business made during the Calculation Period ending on that Calculation Date. The adjustments will be made on the basis of the historical EBITDA of the company or business acquired or disposed of in the Calculation Period and ending on that Calculation Date by reference to historical EBITDA for the twelve months immediately preceding the Calculation Date and by reference to:

• (a) in the case of a disposal, the period of time during which the applicable company or business was part of the Sims Group; or

• (b) in the case of an acquisition, for that period being the twelve months immediately preceding the Calculation Date.

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“Encumbrance” means any:

• (a) security for the payment of money or performance of obligations, including a mortgage, charge, lien, pledge, trust, power or title retention or flawed deposit arrangement; or

• (b) right, interest or arrangement which has the effect of giving another Person a preference, priority or advantage over creditors including any right of set-off; or

• (c) right that a Person (other than the owner) has to remove something from land (known as a profit à prendre), easement, public right of way, restrictive or positive covenant, lease, or license to use or occupy; or

• (d) third party right or interest or any right arising as a consequence of the enforcement of a judgment,

or any agreement to create any of them or allow them to exist.

“Fixed Charges” means for any period, with respect to the Sims Group, the sum of:

• (a) the aggregate amount of interest paid or accrued in respect of moneys borrowed or raised or in respect of any financial accommodation on a consolidated basis (including without limitation amortization of original issue discounts on any such moneys or accommodation, commissions, discounts and facility, acceptance, usage and issuance and any other fees and charges with respect to any Guarantee, promissory note or acceptance or any discounting arrangements);

• (b) all but the principal component of rentals in respect of capitalized rent paid, accrued or scheduled to be paid or accrued on a consolidated basis during such period; and

• (c) dividends paid, accrued or scheduled to be paid or accrued on a consolidated basis in respect of shares or stock which are Finance Debt

• during the relevant period.

“GAAP” means generally accepted accounting standards in Australia, consistently applied.

“Governmental Authority” means the government of Australia or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guaranteed Share” means any share or stock issued by a member of the Sims Group where redemption of such share or stock or the payment of capital or dividends on such share or stock is the subject of a Guarantee of a member of the Sims Group or a Guarantee of another

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Person who will have recourse in respect of its liability under that Guarantee directly or indirectly to a member of the Sims Group or its assets (other than as a shareholder).

“Issue” means any dispute (other than a dispute that is frivolous or vexatious) between the Guarantor and the Lender as to the calculation of the adjustments to be made in accordance with paragraphs (i) to (iv) of the definition of EBITDA in this Section 1.02.

“Intangible Assets” include all goodwill, copyright, patents, trade marks and licenses, research and development, future income tax benefit, underwriting and formation expenses and other items of a like nature which according to current accounting practices are regarded as unidentifiable and intangible assets.

“Latest Audited Consolidated Balance Sheet” means the most recently prepared audited consolidated balance sheet of the Sims Group, or if a half yearly unaudited balance sheet has been prepared more recently, the half yearly balance sheet, as at or prior to the date at which an examination is being made to determine Total Indebtedness, Total Tangible Assets, Current Assets, Current Liabilities or Shareholders Funds.

“Latest Audited Financial Statements” means the Latest Audited Consolidated Balance Sheet, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the accounting period ended on the date of the Latest Audited Consolidated Balance Sheet, including the notes thereto.

“Laws” means, collectively, all international, foreign, Commonwealth, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.

“Loan Parties” means, collectively, the Company and each Designated Borrower.

“Material Adverse Effect” means (a) a material adverse effect upon the financial condition of the Sims Group taken as a whole; (b) a material impairment of the ability of the Guarantor or any Loan Party to perform its obligations under any Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against the Guarantor of any Loan Document to which it is a party.

“Material Credit Agreements” means (a) that certain Variation to Standard Terms (with attached amended Standard Terms) dated on or about November 2, 2009, as amended, among the Guarantor and certain of its Subsidiaries and Westpac Banking Corporation, (b) that certain Amendment and Restatement Deed (with attached amended and restated Multi Option Facility Agreement) dated on or about November 2, 2009, as amended, among the Guarantor and certain of its Subsidiaries and HSBC Bank Australia Limited, HSBC Bank Plc and HSBC Bank USA National Association, (c) that certain Multi Option Facility Agreement and Common Terms Deed dated on or about November 2, 2009, as amended, among the Guarantor and certain of its Subsidiaries and Commonwealth Bank of Australia, (d) that certain Variation to Standard Terms

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(with attached amended Standard Terms) dated on or about November 2, 2009, as amended, among the Guarantor and certain of its Subsidiaries and National Australia Bank Limited, and (d) any replacement or successor agreements to any of the foregoing or any substantially similar loan or credit agreements with other banks or lenders pursuant to which such banks or lenders have agreed to extend credit to the Guarantor or its Subsidiaries.

“Net Interest Expense” means for any period, the aggregate (without double counting) of all interest paid or accrued during that period in respect of any Finance Debt of the Sims Group (including any fees and charges with respect to any guarantee, indemnity or letter of credit or under any bill of exchange, promissory note or any other acceptance or discounting arrangement and any finance charges paid or payable under any hire purchase agreement or lease agreement for which a member of the Sims Group is actually or contingently liable) less any interest income of the Sims Group during that period.

“Other Taxes” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Guaranty or any other Loan Document to which the Guarantor is a party.

“Responsible Officer” means the chief executive officer, president, chief financial officer, treasurer, assistant treasurer or controller of the Guarantor or other individual holding an other and similar position with the Guarantor.

“Shareholders’ Funds” means Total Assets less Total Indebtedness.

“Sims Group” means the Guarantor and its Subsidiaries.

“Tangible Assets” means all assets other than Intangible Assets.

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“TNW” means Shareholders’ Funds less Intangible Assets.

“Total Assets” means at any time the aggregate amount (as disclosed by the Latest Audited Consolidated Balance Sheet) of all assets of the Sims Group.

“Total Finance Debt” means at any time all Finance Debt that would be included in the calculation of Total Indebtedness.

“Total Indebtedness” means at any time the aggregate amount (as disclosed by the Latest Audited Consolidated Balance Sheet) of all secured and unsecured liabilities of the Sims Group together with, without duplication and unless already included in the Latest Audited Consolidated Balance Sheet:

• (a) the aggregate amount (as disclosed by its latest audited balance sheet) of all secured and unsecured liabilities of any entity which has become a member of the

6

Sims Group since the date of the Latest Audited Consolidated Balance Sheet and all other amounts which would be included in this definition if references to the Latest Audited Consolidated Balance Sheet were to be to the latest audited balance sheet of that entity;

• (b) the unrepaid principal (or its equivalent) of any Finance Debt where the proceeds or benefits of that Finance Debt:

• (i) have been received by any member of the Sims Group, since the date of the Latest Audited Consolidated Balance Sheet, excluding the amount of any such proceeds which have been applied in reduction of any secured or unsecured liabilities included in this definition; or

• (ii) are to be received by any member of the Sims Group and the receipt of such proceeds or benefits has been underwritten or otherwise assured to the satisfaction of the auditor of the Sims Group;

• (c) the paid up capital amount and accrued but unpaid dividends of Guaranteed Shares;

and after:

• (d) deducting:

• (i) the aggregate amount of all secured and unsecured liabilities of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet and in respect of which no other member of the Sims Group has any liability; and

• (ii) the aggregate amount of all liabilities which in the opinion of the auditor of the Sims Group have been defeased in such a way as to enable any such liability to be considered as having been extinguished within the meaning of paragraph 30 of Australian Accounting Standard AAS23; and

• (iii) debt reductions of the type referred to in (b)(iii) of the definition of “Total Tangible Assets”;

• (e) eliminating all inter entity balances among the member of the Sims Groups or any of them (including any member of the Sims Group which has become one since the date of the Latest Audited Consolidated Balance Sheet); and

• (f) making such further adjustments (including, without limitation, elimination of any double counting arising in relation to any Guarantee and the obligation or indebtedness that is the subject of the Guarantee) which in the opinion of the auditor of the Sims Group are appropriate to make a proper determination of the total amount of the aggregate indebtedness of the members of the Sims Group.

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In this definition and the definition of “Current Liabilities”, references to “secured and unsecured liabilities” shall include (without limiting the generality of the expression) all Finance Debt and provisions for estimated liabilities for income taxes, long service leave and dividends recommended, declared or accrued but unpaid and provisions for any Contingent Liability but shall not include paid up share capital (other than Guaranteed Shares), reserves of any nature or undistributed profits;

“Total Tangible Assets” means at any time the aggregate of the book values, as disclosed by the Latest Audited Consolidated Balance Sheet, of all Tangible Assets of the Sims Group and of such Intangible Assets of the Sims Group as the Lender in its sole and absolute discretion may from time to time agree, together with, (unless already included in the Latest Audited Consolidated Balance Sheet):

• (a) the aggregate (as disclosed by its latest audited balance sheet) of the book value of the Tangible Assets as determined by the auditor of the Sims Group (after making provisions for depreciation and bad and doubtful debts and any income yet to mature) of any entity which has become a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet;

• (b) the aggregate proceeds of:

• (i) any issue of shares or stock (including premium) of any member of the Sims Group received since the balance date of the latest Audited Consolidated Balance Sheet; and

• (ii) the aggregate proceeds of any calls on partly paid shares made by any member of the Sims Group which have been received since the balance date of the Latest Audited Consolidated Balance Sheet,

excluding the amount of any such proceeds which:

• (iii) have been applied in reduction of any secured or unsecured liabilities included in the definition of “Total Indebtedness”; or

• (iv) have been applied in acquiring any assets included in Total Tangible Assets under this definition;

• (c) the book value of any Tangible Assets (not excluded as provided below) acquired since the date of the Latest Audited Consolidated Balance Sheet by any member of the Sims Group with the proceeds of the sale of shares or units in any entity which has ceased to be a member of the Sims Group since that date;

• (d) the book value of all assets which are or may be leased, chartered, hired, managed, used or operated under a finance lease (where the capitalized rent has been included in Total Indebtedness) as determined by the auditor of the Sims Group at least annually or (at the option of the Guarantor) the value as at the date of calculation as assessed by a qualified independent appraiser chosen by the Guarantor and approved by the Lender);

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• (e) the proceeds of any Finance Debt referred to in paragraph (b) of the definition of “Total Indebtedness” excluding the amount of any proceeds which:

  • (i) have been applied in reduction of any other secured or unsecured liabilities included in that definition; or

  • (ii) have been applied in acquiring any assets included in Total Tangible Assets under this definition;

• (f) (if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent appraiser approved by the Lender), the excess (if any) of the fair value of that Tangible Asset as established by the appraiser over its book value (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of that entity) and as accepted by the auditor of the Sims Group without qualification;

• and after deducting:

• (g) the amount of any income yet to mature and the amount of provisions for depreciation and for bad and doubtful debts as disclosed by the Latest Audited Consolidated Balance Sheet, in each case to the extent otherwise reported as an asset of the Sims Group;

• (h) the aggregate (as disclosed by the latest audited balance sheet of the relevant entity) of the book values of the Tangible Assets of any entity which has ceased to be a member of the Sims Group since the date of the Latest Audited Consolidated Balance Sheet, other than Tangible Assets of that entity which have become assets of another member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph (f), the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value);

• (i) the book value of any Tangible Assets of any member of the Sims Group which have been applied since the date of the Latest Audited Consolidated Balance Sheet in the acquisition of any entity which has become a member of the Sims Group since that date (except that, where a revaluation of any asset had previously been made under paragraph (f), the fair value of that asset as determined in accordance with that paragraph shall be used instead of the book value); and

• (j) if a revaluation of a Tangible Asset of any member of the Sims Group has been carried out by an independent appraiser (whether at the request of the Lender or otherwise), the excess (if any) of the book value of that Tangible Asset (as disclosed in the Latest Audited Consolidated Balance Sheet or, in the case of any entity which has become a member of the Sims Group since the Latest Audited Consolidated Balance Sheet, as disclosed in the latest audited balance sheet of

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that entity) over its fair value as established by the appraiser and as accepted by the auditor of the Sims Group without qualification; and after:

• (k) eliminating all inter-entity balances among any of the Sims Group (including any member of the Sims Group which has become such since the Latest Audited Consolidated Balance Sheet); and

• (l) making such further adjustments as may properly be necessary to avoid any double counting of assets or as may be required by the auditor of the Sims Group to enable a proper determination to be made of the total amount of the Total Tangible Assets.

1.03 Interpretive Provisions. The rules of construction and interpretation specified in Section 1.02 of the Credit Agreement also apply to this Guaranty and are incorporated herein by this reference.

1.04 Accounting Terms.

(a) Generally. All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Guaranty shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Latest Audited Financial Statements, except as otherwise specifically prescribed herein.

(b) Changes in GAAP. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth herein or in any other Loan Document, and either the Guarantor or the Lender shall so request, the Lender and the Guarantor shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Lender); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Guarantor shall provide to the Lender financial statements and other documents required under this Guaranty or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.

1.05 Rounding. Any financial ratios required to be maintained by the Guarantor pursuant to this Guaranty shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

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ARTICLE II. GUARANTY

2.01 Guaranty. The Guarantor hereby irrevocably, absolutely and unconditionally guarantees, as a primary obligor and not merely as a surety, the full and punctual payment or performance when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise, and at all times thereafter, all of the following debts, liabilities and obligations (collectively, the “Guaranteed Obligations”): (i) all advances to, and debts, liabilities, obligations, covenants and duties of, the Borrowers owing to the Lender arising under the Credit Agreement and each other Loan Document or otherwise with respect to any Loan or Letter of Credit; and (ii) any and all fees, costs or out-of-pocket expenses (including the fees, charges and disbursements of any counsel for the Lender) incurred by the Lender in enforcing any rights under the Loan Documents, in each case whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. Without limiting the generality of the foregoing, the Guarantor’s liability hereunder shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any Loan Party to the Lender under the Loan Documents but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code of the United States of America (Title 11, United States Code) (the “Bankruptcy Code”) or the operation of Sections 502(b) and 506(b) of the Bankruptcy Code.

2.02 Liability of Guarantor Absolute. The Guarantor agrees that its obligations hereunder are irrevocable, absolute, independent and unconditional and shall not be affected by any circumstance which constitutes a legal or equitable discharge of a guarantor or surety other than, subject to Section 2.04, payment in full of the Guaranteed Obligations. In furtherance of the foregoing and without limiting the generality thereof, the Guarantor agrees as follows:

(a) This Guaranty constitutes a guaranty of payment and performance when due and not of collection.

(b) The Lender may enforce this Guaranty upon the occurrence of an Event of Default under the Loan Documents notwithstanding the existence of any dispute between or among any Borrower and the Lender with respect to the existence of such Event of Default.

(c) The obligations of the Guarantor hereunder are independent of the obligations of the Borrowers under the Loan Documents and the obligations of any other guarantor of the obligations of Borrowers under the Loan Documents, and a separate action or actions may be brought and prosecuted against the Guarantor to enforce this Guaranty, irrespective of whether any action is brought against any Borrower or any other Loan Party or whether any Borrower or any other Loan Party is joined in any such action or actions.

(d) Payment by the Guarantor of a portion, but not all, of the Guaranteed Obligations shall in no way limit, affect, modify or abridge the Guarantor’s liability for any portion of the Guaranteed Obligations which has not been paid. Without limiting the generality of the

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foregoing, if the Lender is awarded a judgment in any suit brought to enforce the Guarantor’s covenant to pay a portion of the Guaranteed Obligations, such judgment shall not be deemed to release the Guarantor from its covenant to pay the portion of the Guaranteed Obligations that is not the subject of such suit.

(e) The Lender upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability of this Guaranty or giving rise to any reduction, limitation, impairment, discharge or termination of any Guarantor’s liability hereunder, from time to time may (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Guaranteed Obligations, (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Guaranteed Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations, (iii) request and accept other guaranties of the Guaranteed Obligations, (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any other guaranties of the Guaranteed Obligations, or any other obligation of any Person with respect to the Guaranteed Obligations and (v) exercise any other rights available to them under the Loan Documents.

(f) This Guaranty and the obligations of the Guarantor hereunder shall be valid and enforceable and shall not be subject to any reduction, limitation, impairment, discharge or termination for any reason (other than payment in full of the Guaranteed Obligations), including the occurrence of any of the following, whether or not the Guarantor shall have had notice or knowledge of any of them: (i) any failure or omission to assert or enforce an agreement or election not to assert or enforce, or the stay or enjoining, by order of court, by operation of law or otherwise, of the exercise or enforcement of, any claim or demand or any right, power or remedy (whether arising at law, in equity or otherwise) with respect to the Guaranteed Obligations or any agreement relating thereto, or with respect to any other guaranty of the payment of the Guaranteed Obligations; (ii) any rescission, waiver, amendment or modification of, or any consent to departure from, any of the terms or provisions (including provisions relating to events of default) of the Loan Documents or any agreement or instrument executed pursuant thereto, or of any other guaranty for the Guaranteed Obligations, in each case whether or not in accordance with the terms of the Loan Documents or any agreement relating to such other guaranty; (iii) the Guaranteed Obligations, or any agreement relating thereto, at any time being found to be illegal, invalid or unenforceable in any respect; (iv) the application of payments received from any source to the payment of indebtedness of the Borrowers other than the Guaranteed Obligations, even though the Lender might have elected to apply such payment to any part or all of the Guaranteed Obligations; (v) the Lender’s consent to the change, reorganization or termination of the corporate structure or existence of any Borrower or any of their Subsidiaries and to any corresponding restructuring of the Guaranteed Obligations; (vi) any defenses, set-offs or counterclaims which any Borrower may allege or assert against the Lender in respect of the Guaranteed Obligations, including failure of consideration, breach of warranty, payment, statute of frauds, statute of limitations, accord and satisfaction and usury; and (vii) any other act or thing or omission, or delay to do any other act or thing, which may or might in any manner or to any extent vary the risk of any Guarantor as an obligor in respect of the Guaranteed Obligations.

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2.03 Waivers by Guarantor. The Guarantor hereby waives, for the benefit of the Lender:

(a) any right to require the Lender, as a condition of payment or performance by any Guarantor, to (i) proceed against the Borrowers, any other guarantor of the Guaranteed Obligations or any other Person, (ii) proceed against or have resort to any balance of any deposit account or credit on the books of the Lender in favor of any Borrower or any other Person, or (iii) pursue any other remedy in the power of the Lender whatsoever;

(b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of any Borrower including any defense based on or arising out of the lack of validity or the unenforceability of the Guaranteed Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of any Borrower from any cause other than payment in full of the Guaranteed Obligations;

(c) any defense based upon any Law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal;

(d) any defense based upon the Lender’s errors or omissions in the administration of the Guaranteed Obligations, except behavior which amounts to bad faith;

(e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of this Guaranty and any legal or equitable discharge of any Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting any Guarantor’s liability hereunder or the enforcement hereof, and (iii) any rights to set-offs, recoupments and counterclaims;

(f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance of this Guaranty, notices of default under the Loan Documents or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Guaranteed Obligations or any agreement related thereto, notices of any extension of credit to any Borrower and notices of any of the matters referred to in Section 2.02 above and any right to consent to any thereof; and

(g) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of this Guaranty.

2.04 Void or Voidable Transactions. Without limiting Section 2.12, if under any Debtor Relief Law any Person claims that a transaction (including a payment) under or in connection with this Guaranty or the Guaranteed Obligations is (whether such claim is asserted by any third party or by any Borrower or any other Loan Party) void or voidable, and such claim is upheld, conceded or compromised, then notwithstanding Section 2.02: (a) the Lender is immediately entitled as against the Guarantor to the rights in respect of the Guaranteed Obligations to which it was entitled immediately before the transaction; and (b) the Guarantor agrees, at its own expense, to execute, acknowledge, deliver and cause to be duly filed all such instruments and documents and take all such actions as the Lender may request to restore to the

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Lender any Encumbrance (including this Guaranty) held by it from the Guarantor immediately before the transaction. The Guarantor’s obligations under this Section are continuing obligations, independent of the Guarantor’s other debts, liabilities, obligations, covenants and duties under this Guaranty and shall survive any termination of this Guaranty.

2.05 Indemnity. The Guarantor shall indemnify the Lender and its Related Parties (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the reasonable fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any third party or by any Borrower or any other Loan Party arising out of, in connection with, or as a result of:

(a) the failure of the Borrower to timely pay and perform the Guaranteed Obligations in accordance with the terms of the Credit Agreement and the other Loan Documents;

(b) all or any portion of the Guaranteed Obligations, or any agreement relating thereto, being found to be illegal, invalid or unenforceable in any respect;

(c) all or any portion of the debts, liabilities or obligations of the Guarantor under Section 2.01 being found to be illegal, invalid or unenforceable in any respect;

(d) the payment by the Lender to any trustee in bankruptcy or liquidator (of an insolvent Person) in connection with a payment by the Guarantor or a Borrower;

(e) the failure of the Guarantor to timely pay and perform any debt, liability, obligation, covenant or duty owing to the Lender under this Guaranty;

(f) any representation or warranty made or deemed made by the Guarantor hereunder proving to be incorrect or misleading when made or deemed made; or

(g) the exercise, enforcement or protection by any Person of any right, remedy, power or privilege of the Lender under this Guaranty or the failure or delay to exercise, enforce or protect any such right, remedy, power or privilege.

All amounts due under this Section shall be payable within 10 days of written demand therefor.

2.06 Guarantor’s Rights of Subrogation, Contribution, Etc. Until all of the Guaranteed Obligations shall have been finally and indefeasibly paid and performed in full, the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to the Credit Agreement have been surrendered, the Guarantor waives any claim, right or remedy, direct or indirect, that the Guarantor now has or may hereafter have against any Borrower or any of its assets in connection with this Guaranty or the performance by the Guarantor of its obligations hereunder, in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including (a) any right of subrogation, reimbursement or indemnification that the Guarantor now has or may hereafter have against the any Borrower, and (b) any right to enforce, or to participate in, any claim, right or remedy that

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the Lender now has or may hereafter have against any Borrower. In addition, until all of the Guaranteed Obligations shall have been finally and indefeasibly paid and performed in full, the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to the Credit Agreement have been surrendered, the Guarantor shall withhold exercise of any right of contribution the Guarantor may have against any other guarantor of the Guaranteed Obligations. The Guarantor further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification the Guarantor may have against any Borrower, and any rights of contribution the Guarantor may have against any such other guarantor, shall be junior and subordinate to any rights the Lender may have against each Borrower, and to any right the Lender may have against such other guarantor. If any amount shall be paid to the Guarantor on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when the Guaranteed Obligations shall not have been finally and indefeasibly paid and performed in full, the Commitment shall not have been terminated, all Letters of Credit issued or deemed issued pursuant to the Credit Agreement shall not have been surrendered shall not have been terminated, such amount shall be held in trust for the Lender and shall forthwith be paid over to the Lender to be applied against the Guaranteed Obligations, whether matured or unmatured, in accordance with the terms hereof.

2.07 Subordination of Other Obligations. Any debts, liabilities and obligations of each Borrower now or hereafter held by the Guarantor is hereby subordinated in right of payment to the Guaranteed Obligations, and any such debts, liabilities and obligations of each Borrower to the Guarantor collected or received by the Guarantor after an Event of Default has occurred and is continuing shall be held in trust for the Lender and shall forthwith be paid over to the Lender to be applied against the Guaranteed Obligations but without affecting, impairing or limiting in any manner the liability of the Guarantor under any other provision of this Guaranty.

2.08 Continuing Guaranty. This Guaranty is a continuing guaranty and shall remain in effect until all of the Guaranteed Obligations shall have been finally and indefeasibly paid and performed in full (other than contingent indemnification obligations), the Commitment has been terminated, all Letters of Credit issued or deemed issued pursuant to the Credit Agreement have expired or been terminated; provided, however, that the obligations of the Guarantor under Section 2.04, Article III and Section 7.02 shall survive any termination of this Guaranty. The Guarantor hereby irrevocably waives any right to revoke this Guaranty as to future transactions giving rise to any Guaranteed Obligations.

2.09 Authority of Borrowers. It is not necessary for the Lender to inquire into the powers of any Borrower or any other Loan Party or of the officers, directors, members, partners or agents acting or purporting to act on their behalf, and any Guaranteed Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder.

2.10 Information. Loans may be made or continued and Letters of Credit may be issued, amended or extended by the Lender, as applicable, to or for the account of any Borrower from time to time under the Credit Agreement and related Loan Documents without notice to or authorization from the Guarantor regardless of the financial or other condition of any Borrower at the time of any such extension of credit. The Lender shall have no obligation to disclose or

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discuss with the Guarantor its assessment, or the Guarantor’s assessment, of the financial condition of any Borrower. The Guarantor has adequate means to obtain information from each Borrower on a continuing basis concerning the financial condition of such Borrower and its ability to perform its obligations under the Loan Documents, and the Guarantor assumes the responsibility for being and keeping informed of the financial condition of each Borrower and of all circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations. The Guarantor hereby waives and relinquishes any duty on the part of the Lender to disclose any matter, fact or thing relating to the business, operations or conditions of each Borrower now known or hereafter known by the Lender.

2.11 Right of Setoff. If an Event of Default shall have occurred and be continuing, the Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Laws, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by the Lender to or for the credit or the account of the Guarantor against any and all of the obligations of the Guarantor now or hereafter existing under this Guaranty or any other Loan Document to the Lender, irrespective of whether or not the Lender shall have made any demand under this Guaranty or any other Loan Document and although such obligations of the Guarantor may be contingent or unmatured or are owed to a branch or office of the Lender different from the branch or office holding such deposit or obligated on such indebtedness. The rights of the Lender under this Section are in addition to other rights and remedies (including other rights of setoff) that the Lender may have. The Lender agrees to notify the Guarantor promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.

2.12 Bankruptcy; Post-Petition Interest; Reinstatement of Guaranty.

(a) So long as the Guaranteed Obligations shall not have been finally and indefeasibly paid and performed in full, the Commitment shall not have expired or been terminated, all Letters of Credit issued or deemed issued pursuant to the Credit Agreement shall not have expired or been terminated, the Guarantor shall not, without the prior written consent of the Lender, commence or join with any other Person in commencing any proceeding under any Debtor Relief Law against any Borrower. The obligations of the Guarantor under this Guaranty shall not be reduced, limited, impaired, discharged, deferred, suspended or terminated by any proceeding under any Debtor Relief Laws naming any Borrower as the debtor or by any defense which any Borrower may have by reason of the order, decree or decision of any court or administrative body resulting from any such proceeding.

(b) The Guarantor acknowledges and agrees that any interest on any portion of the Guaranteed Obligations which accrues after the commencement of any proceeding referred to in clause (a) above (or, if interest on any portion of the Guaranteed Obligations ceases to accrue by operation of law by reason of the commencement of said proceeding, such interest as would have accrued on such portion of the Guaranteed Obligations if said proceedings had not been commenced) shall be included in the Guaranteed Obligations because it is the intention of the Guarantor and the Lender that the Guaranteed Obligations which are guaranteed by the Guarantor pursuant to this Guaranty should be determined without regard to any Law which may relieve any Borrower of any portion of such Guaranteed Obligations. The Guarantor will permit

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any trustee in any proceeding under any Debtor Relief Law or similar Person to pay the Lender, or allow the claims of the Lender in respect of, any such interest accruing after the date on which such proceeding is commenced.

(c) In the event that all or any portion of the Guaranteed Obligations are paid by any Borrower or by any other guarantor, the obligations of the Guarantor hereunder shall continue and remain in full force and effect or be reinstated, as the case may be, in the event that all or any part of such payment(s) are rescinded or recovered directly or indirectly from the Lender as a preference, fraudulent transfer or otherwise, and any such payments which are so rescinded or recovered shall constitute Guaranteed Obligations for all purposes under this Guaranty.

ARTICLE III. TAXES

3.01 Payments Free of Taxes. Any and all payments by or on account of any obligation of the Guarantor hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that if the Guarantor shall be required by applicable Laws to deduct any Indemnified Taxes (including any Other Taxes but excluding, to the extent included in Other Taxes, any Excluded Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Lender receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Guarantor shall make such deductions and (iii) the Guarantor shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable Laws.

3.02 Payment of Other Taxes by Guarantor. Without limiting the provisions of Section 3.01, the Guarantor shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable Laws.

3.03 Indemnification by the Guarantor. The Guarantor shall indemnify the Lender, within 30 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes (but excluding, to the extent included in Other Taxes, any Excluded Taxes) imposed or asserted on or attributable to amounts payable under this Article) paid by the Lender and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority; provided that the Lender has paid such Indemnified Taxes in good faith. A certificate as to the amount of such payment or liability delivered to the Guarantor by the Lender shall be conclusive absent manifest error.

3.04 Evidence of Payment. As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Guarantor to a Governmental Authority, the Guarantor shall deliver to the Lender the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Lender or such other, alternate evidence as may be

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reasonably acceptable to the Lender evidencing payment in full of all applicable Indemnified Taxes and Other Taxes.

3.05 Treatment of Certain Refunds. If the Lender determines that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by the Guarantor or with respect to which the Guarantor has paid additional amounts pursuant to this Section, it shall pay to the Guarantor an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Guarantor under this Section with respect to the Taxes or Other Taxes giving rise to such refund), net of all reasonable out-of-pocket expenses of the Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the Guarantor, upon the request of the Lender, agrees to repay the amount paid over to the Guarantor (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Lender in the event the Lender is required to repay such refund to such Governmental Authority. The Lender agrees to provide to the Guarantor evidence of any refund of any Taxes or Other Taxes described in the preceding sentence and the amount thereof; provided, however, that the Lender shall not incur any liability for failing to provide the Guarantor with such evidence. This subsection shall not be construed to require the Lender to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Guarantor or any other Person.

ARTICLE IV. REPRESENTATIONS AND WARRANTIES

The Guarantor represents and warrants to the Lender that:

4.01 Existence, Qualification and Power. The Guarantor (a) is duly organized or formed, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and (ii) execute, deliver and perform its obligations under this Guaranty and the other Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

4.02 Authorization; No Contravention. The execution, delivery and performance by the Guarantor of this Guaranty and the other Loan Documents to which it is a party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) contravene the terms of the Guarantor’s Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (i) any Contractual Obligation to which the Guarantor is a party or affecting the Guarantor or the properties of the Guarantor or any of its Subsidiaries or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law, to the extent, in the case of clauses (b) and (c), any such conflict, breach, contravention or violation, could reasonably be expected to have a Material Adverse Effect.

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4.03 Governmental Authorization; Other Consents. No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, the Guarantor of this Guaranty and the other Loan Documents to which it is a party.

4.04 Commercial Acts; No Immunity. The Relevant Companies are subject to civil and commercial Laws with respect to their obligations under this Guaranty and the other Loan Documents to which they are party, and the execution, delivery and performance by the Relevant Companies of this Guaranty and the other Loan Documents to which they are party constitute and will constitute private and commercial acts and not public or governmental acts. None of the Relevant Companies nor any of their properties have any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) under the Laws of the jurisdiction in which the Relevant Companies are incorporated or organized in respect of their obligations under this Guaranty and the other Loan Documents to which they are party.

4.05 Binding Effect. This Guaranty has been, and each other Loan Document to which it is a party, when delivered, will have been, duly executed and delivered by the Guarantor. This Guaranty constitutes, and each such other Loan Document when so delivered will constitute, a legal, valid and binding obligation of the Guarantor, enforceable against it in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other Laws affecting the enforcement of creditors’ rights generally.

4.06 Latest Audited Financial Statements; No Material Adverse Effect.

(a) The Latest Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present the financial condition of the Sims Group as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of the Sims Group as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.

(b) Since the date of the Latest Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

4.07 Litigation. No litigation, tax claim, dispute arbitration, administrative proceeding or other similar proceeding is presently current or pending or, to a Relevant Company’s knowledge, threatened that (a) purports to pertain to this Guaranty or any other Loan Document, or any of the transactions contemplated hereby or (b) which might, individually or in the aggregate, have a Material Adverse Effect.

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4.08 No Default. Neither the Guarantor nor any Subsidiary thereof is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Guaranty or any other Loan Document.

4.09 Environmental Compliance. Other than those authorizations which a failure to obtain or maintain is not likely to have a Material Adverse Effect, the Guarantor has obtained all authorizations it is required to obtain under any Environmental Laws and such authorizations are in full force and effect.

4.10 Compliance with Laws. The Guarantor is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

4.11 Identifying Information. The true and correct unique identification number of the Guarantor that has been issued by the jurisdiction of its incorporation or organization is ABN 69 114 838 630.

4.12 Solvency. There are no reasonable grounds to suspect that the Guarantor or any of its Subsidiaries are unable to pay their debts as and when they become due and payable or will be unable to do so.

4.13 Material Credit Agreements. (a) Each of the Material Credit Agreements are in full force and effect and that no default or event of default (howsoever defined) has occurred and is continuing under any of the Material Credit Agreements, the effect of which default or other event is to cause, or to permit the counterparty or counterparties under such Material Credit Agreements to cause, with the giving of notice if required, the Indebtedness evidenced thereby or credit extended thereunder to be demanded or to become due prior to its stated maturity; and (b) the financial covenants set forth in Section 5.10 are no less restrictive than the financial covenants set forth in the Material Credit Agreements.

4.14 Benefit. The entering into and performance by the Guarantor of its obligations under the Loan Documents to which it is expressed to be a party is for its commercial benefit and is in its commercial interests.

4.15 Guarantor Not a Trustee. The Guarantor does not enter into this Guaranty or any other Loan Document to which it is a party as a trustee of any trust or settlement.

4.16 No Benefit to Related Party. The Guarantor has not contravened or will contravene section 208 or section 209 of the Corporations Act 2001 (Cwlth) by entering into any Loan Document or participating in any transaction in connection with a Loan Document.

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4.17 Disclosure. All information provided to the Lender by or on the Guarantor’s behalf in relation to it, its assets, business or affairs or the Loan Documents was correct and not misleading (by omission or otherwise) as at the time it was provided.

4.18 Repeat of Representations and Warranties. The representations and warranties in this Article IV are taken to be made on the date of this Guaranty and repeated (by reference to the then current circumstances) on every date on which the Lender provides financial accommodation to a Borrower.

4.19 Reliance. The Guarantor acknowledges that the Lender has entered into the Loan Documents to which it is a party in reliance on the representations and warranties in this Article IV.

4.20 No Filing or Stamp Taxes. Under the law of any relevant jurisdiction it is not necessary that the Loan Documents be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp duty, registration or other similar Tax be paid on or in relation to the Loan Documents or the transactions contemplated by those Loan Documents.

4.21 Taxation. To the best of the Guarantor’s knowledge, information and belief, having made due enquiries, it has complied with all material laws relating to Tax in all jurisdictions in which it is subject to Tax and has paid all Taxes due and payable by it (other than those Taxes which it is contesting in good faith and in respect of which it has made adequate reserves as long as failure to pay those Taxes would not have, and is not reasonably likely to have, a Material Adverse Effect).

4.22 Pari Passu. The Guarantor’s payment obligations under this Guaranty and the other Loan Documents to which it is a party rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.

4.23 Governing Law and Enforcement. Subject to any qualification in any legal opinion provided to the Lender pursuant to the Loan Documents relating to it or the laws of its jurisdiction:

(a) the choice of law referred to in this Guaranty as the governing law of this Guaranty will be recognized and enforced in its jurisdiction of incorporation or organization and in the jurisdiction referred to in that clause (if different); and

(b) any judgment obtained against it in that jurisdiction will be recognized and enforced in its jurisdiction of incorporation or organization.

4.24 Legal and Beneficial Owner. The Guarantor is the legal and beneficial owner of its assets and undertaking.

4.25 Full Disclosure. The Guarantor has disclosed in writing to the Lender all facts relating to it and its Subsidiaries, the Loan Documents and all things in connection with them, which are material to the assessment of the nature and amount of the risk undertaken by the Lender in entering into the Loan Documents and doing anything in connection with them.

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4.26 Most Favored Nation. In the reasonable opinion of the Guarantor, the terms of the Loan Documents (other than those terms related to pricing (including fees and margins, facility limits, repayment dates and in the case of hedging pricing and individual transaction amounts)) are no less favorable in any material respect than the terms in any other facility agreements to which a Relevant Company is a party.

4.27 Representations True. The Guarantor’s representations and warranties contained in the Loan Documents are correct and not misleading when made or repeated.

ARTICLE V. AFFIRMATIVE COVENANTS

So long as the Commitment shall be in effect, any Loan or other Obligation under the Credit Agreement shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Guarantor shall, and shall (except in the case of the covenants set forth in Sections 5.01, 5.02, and 5.03) cause each Loan Party to:

5.01 Financial Statements. Deliver to the Lender, in form and detail satisfactory to the Lender:

(a) as soon as available, but in any event within 90 days after the end of each fiscal year of the Guarantor, the audited consolidated balance sheet of the Guarantor and its Subsidiaries as at the end of such fiscal year, and the related audited consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year and the accompanying audit report; and

(b) as soon as available, but in any event within 90 days after the end of the first fiscal half of each fiscal year of the Guarantor, the unaudited consolidated balance sheet of the Guarantor and its Subsidiaries as at the end of such fiscal half year, and the related unaudited consolidated statements of income or operations, shareholders’ equity and cash flows for such half year prepared in accordance with GAAP.

5.02 Certificates; Other Information. Deliver to the Lender, in form and detail satisfactory to the Lender:

(a) concurrently with the delivery of the financial statements referred to in Sections 5.01(a) and (b), a duly completed Compliance Certificate signed by the chief executive officer, chief financial officer, treasurer or controller of the Guarantor;

(b) promptly after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of the Guarantor;

(c) promptly, such additional information regarding the business, financial or corporate affairs of the Guarantor or any Subsidiary, or compliance with the terms of the Loan Documents, as the Lender may from time to time reasonably request.

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5.03 Notices. Promptly notify the Lender:

• (a) of the occurrence of any Default; and

(b) of any breach of any Environmental Law or the issuing of any proceedings or notice or requirements against or upon it or its assets in respect of, or which is likely to result in, any Environmental Liability or breach of any Environmental Law in each case, which has had, or is reasonably likely to have a Material Adverse Effect;

(c) of the commencement of, or any material development in, any litigation, arbitration, administrative or other proceeding in respect of it or any of its assets being commenced or threatened which is in excess of AU$25,000,000 or its equivalent;

(d) of any proposal of any Government Authority to compulsorily acquire the whole or a substantial part of its assets; and

• (e) of the acquisition or formation by it of a Subsidiary.

Each notice pursuant to this Section 5.03 shall be accompanied by a statement of a Responsible Officer of the Guarantor setting forth details of the occurrence referred to therein and stating what action the Guarantor has taken and proposes to take with respect thereto.

5.04 Payment of Obligations. Pay and discharge its obligations and liabilities, including (a) tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Guarantor or such Subsidiary; (b) all lawful claims which, if unpaid, would by law become a Lien upon its property; and (c) all Indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness.

5.05 Preservation of Existence, Etc. (a) Preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 6.02 or 6.03; and (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

5.06 Maintenance of Properties; Conduct of Business; Insurance.

(a) Maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted;

(b) Conduct its business (including collecting debts owed to it) in a proper, orderly and efficient manner.

(c) Shall, and shall ensure that each Relevant Company will:

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(i) maintain industrial special risks insurance, public liability insurance, professional indemnity liability insurance and directors and officers liability insurance with an independent and reputable insurer and consistent with the insurances maintained by it as at the date of this Guaranty;

(ii) otherwise insure, and keep insured, its property which is of an insurable nature in the manner and to the extent which is in accordance with good business practice for property of such nature; and

(iii) promptly following a request by the Lender, provide the Lender with any certificates of currency or other evidence of currency in respect of all insurances required to be maintained by it under this Guaranty.

5.07 Compliance with Laws. Ensure that each Relevant Company will:

(a) comply with all laws and legal requirements, including each judgment, award, decision, finding or any other determination of a Governmental Authority, which applies to it or any of its assets, where failure to do so will have or be likely to have a Material Adverse Effect;

(b) obtain, maintain and comply with:

(i) all authorizations required in relation to the entry into, performance of obligations under, and enforceability of, each Loan Document to which it is a party; and

(ii) all authorizations that are material to the carrying on of the business of the Sims Group (taken as a whole) where failure to do so has or is likely to have a Material Adverse Effect,

and ensure those authorizations are not cancelled, suspended, not renewed, varied or found to be invalid; and

(c) not do anything which would prevent the renewal of any authorization referred to in subsection (b) above or cause it to be renewed on less favorable terms.

5.08 Books and Records. (a) Maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Guarantor or such Subsidiary, as the case may be; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Guarantor or such Subsidiary, as the case may be.

5.09 Approvals and Authorizations. Maintain all authorizations, consents, approvals and licenses from, exemptions of, and filings and registrations with, each Governmental Authority of the jurisdiction in which each Foreign Obligor is organized and existing, and all approvals and consents of each other Person in such jurisdiction, in each case that are required in connection with the Loan Documents.

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5.10 Financial Covenants. Ensure that on each Calculation Date:

• (a) the ratio of Finance Debt to EBITDA for the Calculation Period ending on that Calculation Date is not greater than 3.0:1;

(b) the ratio of EBITDA to Net Interest Expense for the Calculation Period ending on that Calculation Date is not less than 3.5:1; and

• (c) TNW is at least 85% of the TNW calculated for the last Calculation Date of the preceding financial year.

5.11 Most Favored Nations Status. Promptly, but in any event within fifteen (15) days after the occurrence of each such event or matter, give written notice (“Guarantor MFN Notice”) to the Lender specifying in reasonable detail the incurrence of any new or additional material Indebtedness and the material terms (other than pricing) thereof, and of any change, whether by addition or modification in the material terms (other than pricing), conditions, covenants (including financial covenants) or events of default of any material Indebtedness. If the Lender determines in its sole discretion that the terms, covenants (including financial covenants) or events of default of any material Indebtedness of the Guarantor existing on the date of this Agreement or incurred thereafter are more restrictive with respect to the Guarantor than the terms, conditions, covenants (including financial covenants) or events of default of this Guaranty, the Lender shall promptly, but in any event within fifteen (15) days after the Lender’s receipt of the Guarantor MFN Notice, give written notice (“Lender MFN Notice”) to the Guarantor specifying in reasonable detail those terms, conditions, covenants (including financial covenants) or events of default of such Indebtedness, if any, that the Lender will require to be incorporated in this Guaranty. In the event that the Lender delivers a Lender MFN Notice, then within thirty (30) days after the Guarantor’s receipt thereof, the Guarantor shall execute and deliver to the Lender such documents, instruments, consents and agreements in form and content satisfactory to the Lender, as may be required by the Lender in its sole discretion, in order to incorporate into this Guaranty the terms, conditions, covenants (including financial covenants) and events of default specified in the Lender MFN Notice, together with such supporting resolutions, incumbency certificates, opinions of counsel and other documents or information, in form, content and scope satisfactory to the Lender, as may be required by the Lender in its sole discretion.

ARTICLE VI. NEGATIVE COVENANTS

So long as the Commitment shall be in effect, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, the Guarantor shall not, nor shall it permit any Loan Party to, directly or indirectly:

6.01 Liens. Create, incur, assume or suffer to exist any Liens upon any of its property, assets or revenues, whether now owned or hereafter acquired, except Liens securing Indebtedness in an aggregate amount not to exceed five percent (5%) of Total Tangible Assets as of the date of the most recently prepared audited consolidated balance sheet of the Sims Group.

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6.02 Fundamental Changes. Merge, dissolve, liquidate, consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person, except that, so long as no Default exists or would result therefrom:

(a) any Subsidiary may merge with (i) the Guarantor, provided that the Guarantor shall be the continuing or surviving Person, or (ii) any one or more other Subsidiaries, provided that when any Borrower is merging with another Subsidiary, the Borrower shall be the continuing or surviving Person; and

(b) any Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to the Guarantor or to another Subsidiary; provided that if the transferor in such a transaction is a Borrower, then the transferee must either be the Guarantor or a Borrower.

6.03 Dispositions. Dispose of more than ten percent (10%) of Total Tangible Assets or an interest in them or agree or attempt to do so (whether in one or more related or unrelated transactions) except:

• (a) where the Disposal is in the ordinary course of day to day trading; and

• (b) the Disposals are of surplus or obsolete assets no longer required for its business.

6.04 Change in Nature of Business. Engage in any material line of business substantially different from those lines of business conducted by the Guarantor and its Subsidiaries on the date hereof or any business substantially related or incidental thereto.

6.05 Finance Debt.

(a) Provide any Finance Debt, or give any Guarantee in respect of any Finance Debt, to or for the benefit of any Person, other than Permitted Finance Debt or with the prior written consent of the Lender;

(b) Permit Finance Debt to remain owing to it by a Relevant Company which is not a Loan Party; or

(c) Satisfy any Finance Debt owed to a Relevant Company which is not a Loan Party except any Finance Debt which, in aggregate with all other Finance Debt owed by a Loan Party to a Relevant Company which is not a Loan Party that is satisfied in the twelve (12) month period prior to the date on which the Finance Debt is to be satisfied, does not exceed AU$10,000,000.

6.06 Negative Pledge.

(a) Deposit money with a Person in circumstances where the money is not repayable unless the Guarantor performs obligations (including to pay money) to that Person, except in respect of deposits which in aggregate do not exceed AU$35,000,000 at any time; or

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(b) Enter into any arrangement which, if complied with, would prevent any Loan Party from complying with its obligations under the Loan Documents.

6.07 Swap Contracts . Enter, and must ensure that no Relevant Company will enter, into a Swap Contract agreement except:

(a) for the purposes of hedging its actual or projected interest rate, foreign exchange or other exposures arising in the ordinary course of its ordinary business and not for speculative purposes; or

(b) with the Lender’s prior written consent.

ARTICLE VII. MISCELLANEOUS

7.01 No Waiver; Cumulative Remedies. No failure by the Lender to exercise, and no delay in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. No waiver of any single breach or default under this Guaranty shall be deemed a waiver of any other breach or default. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges that may otherwise be available to the Lender. Any single or partial exercise of any right or remedy shall not preclude the further exercise thereof or the exercise of any other right or remedy. No notice or demand on the Guarantor in any case shall entitle the Guarantor to any other or further notice or demand in similar or other circumstances.

7.02 Costs and Expenses. Subject to Section 7.04, the Guarantor agrees to pay or reimburse the Lender within five Business Days after demand for any and all reasonable fees, costs or out-of-pocket expenses (including the fees, charges and disbursements of any counsel for the Lender) incurred by the Lender in connection with the exercise, enforcement or protection of any of the rights of the Lender under this Guaranty (including all such costs and expenses incurred during any “workout” or restructuring in respect of the Guaranteed Obligations and during any legal proceeding, including any proceeding under any Debtor Relief Law).

7.03 Notices. All notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier (a) in the case of the Lender, to the address or telecopier number of the Lender specified for notices in Schedule 10.02 of the Credit Agreement and (b) in the case of the Guarantor, to the address or facsimile number of the Borrowers specified for notices on Schedule 10.02 of the Credit Agreement. Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient).

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7.04 Dispute Resolution.

(a) If an Issue, or a circumstance that is reasonably likely to result in an Issue, arises the Guarantor and the Lender must not commence any court proceedings relating to the Issue unless it has complied with the provisions of this Section 7.04, except to seek urgent interlocutory relief.

(b) If the Guarantor or the Lender become aware of an Issue, or a circumstance that is reasonably likely to result in an Issue, it must promptly notify the other (“Initial Notice”) and if the Issue is not resolved within ten (10) Business Days from the date of that Initial Notice (excluding the date of that Initial Notice) (or such other period as agreed to in writing between the Guarantor and the Lender), then either the Guarantor or the Lender may give a written notice to the other specifying the nature and details of the Issue (“Notification”).

(c) If an Issue is resolved within ten (10) Business Days from the date on which Initial Notice is provided (excluding the date on which Initial Notice is given) (or such other period as agreed to in writing between the Guarantor and the Lender), the Guarantor and the Lender must exchange written acknowledgement of such resolution prior to the end of the ten (10) Business Day period.

(d) Once a Notification is given in accordance with Section 7.04(b), a Dispute is taken to have arisen. If no Notification is given in accordance with Section 7.04(b) or the Issue is resolved and written acknowledgement has been exchanged between the Guarantor and the Lender in accordance with Section 7.04(c), a Dispute will not be taken to have arisen in relation to the Issue and the provisions of this Section 7.04 will no longer apply. If the provisions of this Section 7.04 no longer apply as a result of the failure of either the Guarantor or the Lender to give a Notification, the matter or thing asserted by either the Guarantor or the Lender which gave rise to the Issue will be disregarded.

(e) If the Guarantor and the Lender do not resolve the Dispute within ten (10) Business Days after the Notification is given (excluding the date on which the Notification is given) (or such other period as agreed to in writing between the Guarantor and the Lender) either the Guarantor or the Lender may submit the Dispute to expert determination.

(f) If the Dispute is referred to expert determination under Section 7.04(e):

(i) both the Guarantor and the Lender may nominate an independent expert with relevant expertise in accounting, legal and commercial matters to act as expert and submit this nomination to the other within the earlier of twelve (12) Business Days after the Notification is given (excluding the date on which the Notification is given), or two (2) Business Days following a decision by the Guarantor and the Lender to submit the Dispute to expert determination (excluding the date on which that decision is reached) (or such other period as agreed to in writing between the Guarantor and the Lender);

(ii) if only the Lender or only the Guarantor nominates an expert in accordance with Section 7.04(f)(i), the nominated expert will be taken to have been agreed to by both the Guarantor and the Lender and that expert will be validly appointed;

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(iii) if the Guarantor and the Lender do not agree on the appointment of an expert within three (3) Business Days after both expert nominations have been submitted (excluding the date on which both nominations have been submitted), the matter will be referred to the President of the Institute of Chartered Accountants of Australia who will nominate an expert to determine the Dispute and both the Guarantor and the Lender will accept this nomination;

(iv) where the Guarantor is engaged in a dispute with any of its other lenders (which have adopted a dispute resolution Section in substantially the same form as this Section 7.04) in relation to the same subject matter as a Dispute or Issue between the Guarantor and the Lender, the Lender agrees to the common appointment of an expert to resolve the disputes simultaneously and an expert appointed in these circumstances can only be appointed if the expert accepts a common appointment;

(v) the terms of the expert’s retainer must provide that in resolving the Dispute the expert will, to the extent relevant, be subject to the then current ACDC Guidelines for Expert Determination, and will use all reasonable endeavours to ensure that if a Dispute relates to a current Calculation Period a decision is reached prior to the Calculation Date for that Calculation Period;

(vi) the terms of the expert’s retainer must provide that the expert must provide a decision as soon as reasonably practicable and in any event no later than the five (5) Business Days from the date of referral (excluding the date of referral) (or such other period as agreed to in writing between the Guarantor and the Lender);

(vii) the decision of the expert is final and binding on the Lender and the Guarantor except in the case of manifest error; and

(viii) if, for any reason:

(A) an expert is not appointed within five (5) Business Days of the expert appointment decision being referred to the President of the Institute of Chartered Accountants of Australia (excluding the date on which the matter is referred);

(B) or the appointed expert provides the Guarantor and the Lender with written confirmation that the expert is unable to reach a decision in relation to the Dispute,

the provisions of this Section 7.04 will no longer apply to the Dispute and the Guarantor and the Lender may:

(C) commence court proceedings; and/or

(D) pursue any other remedies that are available to the relevant party,

in relation to the matter or thing forming the subject matter of the Dispute.

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(g) If a Dispute or Issue first arises prior to the end of a Calculation Period and is not resolved in accordance with this Section 7.04 by the end of that Calculation Period, the Guarantor and the Lender agree to use reasonable endeavours to resolve the Dispute or Issue as soon as possible following the relevant Calculation Date and in any event no later than 30 Business Days following the Guarantor and the Lender first becoming aware of the Issue (excluding the date on which both the Guarantor and the Lender first become aware of the Issue) (or such other period as agreed to in writing between the Guarantor and the Lender).

(h) The Lender agrees that prior to the resolution of the Dispute or Issue in accordance with the provisions of this Section 7.04, or the termination of the dispute resolution process as contemplated by Section 7.04(f)(viii), the subject matter of any Dispute or Issue may not be taken into account in determining whether the Guarantor is in breach of any of the financial undertakings contained in Section 5.10 of this Guaranty that require EBITDA to be calculated.

(i) The Guarantor must bear the costs of complying with this Section 7.04 and comply with the obligations under the Loan Documents during the dispute resolution process contained in this Section 7.04.

(j) In acting under the provisions of this Section 7.04 the Guarantor and the Lender must at all times use reasonable endeavours to resolve any Dispute or Issue.

(k) The Guarantor represents and warrants for the benefit of the Lender that each Material Credit Agreement that requires or contemplates adjustments to EBITDA contains a dispute resolution Section in substantially the same form as this Section 7.04.

7.05 Payment by Guarantor; Application of Payments. Without limiting any other right that the Lender has at law or in equity against the Guarantor by virtue hereof, upon the failure of any Borrower to pay any Guaranteed Obligation when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code), the Guarantor hereby promises to and will forthwith pay, or cause to be paid, to the Lender as designated thereby, in cash such Guaranteed Obligation. Except as otherwise expressly provided herein, all payments by the Guarantor hereunder shall be made to the Lender within 10 days of written demand therefor in the currency in which the applicable Guaranteed Obligation was denominated and in Same Day Funds at the Lending Office for such currency. If any amount payable by the Guarantor under this Guaranty is not paid when due, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate. Payments received from the Guarantor shall, unless otherwise expressly provided herein, be applied:

First, to payment of any fees, costs or out-of-pocket expenses (including the fees, charges and disbursements of any counsel for the Lender) incurred by the Lender in connection with the exercise, enforcement or protection of any of the rights of the Lender under this Guaranty; and

Second, to payment in full of the Guaranteed Obligations (to the extent not included in clause First above) in accordance with Section 8.03 of the Credit Agreement.

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The Lender shall have absolute discretion as to the time of application of any payments received from the Guarantor.

7.06 Assignments, Participations, Confidentiality. The Lender may from time to time, without notice to the Guarantor and without affecting the Guarantor’s obligations hereunder, transfer its interest in the Guaranteed Obligations to Eligible Assignees and Participants as provided in the Credit Agreement. The Guarantor agrees that each such transfer will give rise to a direct obligation of the Guarantor to each such Eligible Assignee and Participant and that each such Eligible Assignee and Participant shall have the same rights and benefits under this Guaranty as it would have if it were the Lender. The Guarantor and the Lender agree that the provisions of Section 10.07 of the Credit Agreement shall apply to all information provided to the Lender by the Guarantor under this Guaranty or any other Loan Document to which the Guarantor is a party, other than any such information that is available to the Lender on a nonconfidential basis prior to disclosure by the Guarantor; provided that, in the case of information received from the Guarantor after the date hereof, such information is clearly identified in writing at the time of delivery as confidential.

7.07 Loan Document. This Guaranty is a Loan Document executed and delivered pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions thereof. Without limiting the generality of the foregoing, the rules of construction and interpretation specified in Section 1.02 of the Credit Agreement also apply to this Guaranty and are incorporated herein by this reference.

7.08 Governing Law; Jurisdiction; Etc.

(a) GOVERNING LAW. THIS GUARANTY IS GOVERNED BY THE LAW IN FORCE IN NEW SOUTH WALES, AUSTRALIA.

(b) SUBMISSION TO JURISDICTION. THE GUARANTOR SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF NEW SOUTH WALES, AUSTRALIA. NOTHING IN THIS GUARANTY OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT AGAINST ANY GUARANTOR OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c) WAIVER OF VENUE. THE GUARANTOR IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. THE GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

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(d) SERVICE OF PROCESS. THE GUARANTOR IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.03. NOTHING IN THIS GUARANTY WILL AFFECT THE RIGHT OF THE LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

7.09 Waiver of Jury Trial. THE GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTY AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS IN THIS SECTION.

7.10 USA PATRIOT Act Notice. The Lender hereby notifies the Guarantor that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Guarantor, which information includes the name and address of the Guarantor and other information that will allow the Lender to identify the Guarantor in accordance with the Act.

7.11 Amendments, Etc. No amendment or waiver of any provision of this Guaranty, and no consent to any departure by the Guarantor therefrom, shall be effective unless in writing signed by the Lender and the Guarantor, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit under the Credit Agreement shall not be construed as a waiver of any Default or Event of Default under the Credit Agreement.

7.12 Integration; Effectiveness. This Guaranty and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. This Guaranty shall become effective when the Lender shall have received a copy of this Guaranty that bears the signatures of the Guarantor. Delivery of an executed signature page of this Guaranty by telecopy shall be effective as delivery of a manually executed signature page of this Guaranty.

7.13 Severability. If any provision of this Guaranty is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Guaranty shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions

32

the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

7.14 No Inconsistent Requirements. The Guarantor acknowledges that this Guaranty and the other Loan Documents may contain covenants and other terms and provisions variously stated regarding the same or similar matters, and agrees that all such covenants, terms and provisions are cumulative and all shall be performed and satisfied in accordance with their respective terms.

7.15 Judgment Currency. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due hereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Lender could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The obligation of the Guarantor in respect of any such sum due from it to the Lender hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicable provisions of this Guaranty (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receipt by the Lender of any sum adjudged to be so due in the Judgment Currency, the Lender may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency. If the amount of the Agreement Currency so purchased is less than the sum originally due to the Lender from the Guarantor in the Agreement Currency, the Guarantor agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Lender or the Person to whom such obligation was owing against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Lender in such currency, the Lender agrees to return the amount of any excess to the Guarantor (or to any other Person who may be entitled thereto under applicable Laws).

7.16 Amendment and Restatement. This Amended and Restated Deed Poll of Continuing Guaranty amends and restates in its entirety that certain Deed Poll of Continuing Guaranty dated September 12, 2006 made by the Guarantor in favor of the Lender.

7.17 Consideration. The Guarantor acknowledges that the Lender is acting in reliance on the Guarantor incurring obligations and giving rights under this Guaranty.

[Remainder of page intentionally left blank]

33

THIS AMENDED AND RESTATED DEED POLL OF CONTINUING GUARANTY IS EXECUTED AND UNCONDITIONALLY DELIVERED AS A DEED POLL FOR THE BENEFIT OF BANK OF AMERICA, N.A. (INCLUDING ITS PERMITTED SUCCESSORS AND ASSIGNS) AND IS GOVERNED BY THE LAWS OF THE STATE OF NEW SOUTH WALES.

EXECUTED by SIMS METAL MANAGEMENT ) LIMITED in accordance with section 127(1) of the ) Corporations Act 2001 (Cwlth) by authority of its ) directors: ) ) ) ) Signature of director/company secretary ) delete whichever is not applicable Signature of director ) ) ) Name of director/company secretary* Signature of director (block letters) ) (block letters)

Signature of director (block letters)

*delete whichever is not applicable

EXECUTED by BANK OF AMERICA, N.A. : ) ) ) ) ) Signature of officer ) ) ) ) Signature of officer (block letters) )

1

EXHIBIT A

FORM OF COMPLIANCE CERTIFICATE

Financial Statement Date: [ , _]

To: Bank of America, N.A.

Ladies and Gentlemen:

Reference is made to that certain Amended and Restated Deed Poll of Continuing Guaranty, dated as of November 2, 2009 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Guaranty;” the terms defined therein being used herein as therein defined), made by Sims Metal Management Limited, a corporation incorporated in the State of Victoria, Commonwealth of Australia (the “Guarantor”), in favor of Bank of America, N.A., a national banking association (the “Lender”).

The undersigned Responsible Officer hereby certifies as of the date hereof that he/she is the of the Guarantor, and that, as such, he/she is authorized to execute and deliver this Certificate to the Lender on the behalf of the Guarantor, and that:

[Use following paragraph 1 for fiscal year-end financial statements]

1. Attached hereto as Schedule 1 are the year-end audited financial statements required by Section 5.01(a) of the Guaranty for the fiscal year of the Guarantor ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section.

[Use following paragraph 1 for first fiscal half-year financial statements]

1. Attached hereto as Schedule 1 are the unaudited financial statements required by Section 5.01(b) of the Guaranty for the first fiscal half year of the Guarantor ended as of the above date. Such financial statements fairly present the financial condition, results of operations and cash flows of the Guarantor and its Subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.

[select one:]

1. [To the best knowledge of the undersigned during such fiscal period, the Guarantor and each of the Loan Parties have performed and observed each covenant and condition of the Loan Documents applicable to it, and no Default has occurred and is continuing.]

—or—

1. [The following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]

2. The representations and warranties of (i) the Guarantor contained in Article IV of the Guaranty and (ii) each Loan Party contained in each other Loan Document or in any document furnished at any time under or in connection with the Loan Documents, are true and correct on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in subsection (a) of Section 4.06 of the Guaranty shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 5.01 of the Guaranty, including the statements in connection with which this Compliance Certificate is delivered.

3. The financial covenant analyses and information set forth on Schedule 2 attached hereto are true and accurate on and as of the date of this Certificate.

IN WITNESS WHEREOF , the undersigned has executed this Certificate as of , ___.

SIMS METAL MANAGEMENT LIMITED

By:

Name:

Title:

2

For the Quarter/Year ended (“Statement Date”) SCHEDULE 2 to the Compliance Certificate ($ in 000’s)

EX-8.1 c53813exv8w1.htm EX-8.1

Exhibit 8.1

Australia Sims Aluminum Pty Limited Sims Energy Pty Limited Sims E-Recycling Pty Limited (90% direct interest) Sims Group Australia Holdings Limited Sims Group Holdings 1 Pty Ltd Sims Group Holdings 2 Pty Ltd Sims Industrial Pty Limited Sims Manufacturing Pty Limited Sims Superannuation Management Pty Limited Sims Tyrecycle Properties Pty Ltd Simsmetal Executive Staff Superannuation Pty Limited Simsmetal Holdings Pty Limited Simsmetal Services Pty Limited Simsmetal Staff Equity Pty Limited Universal Inspection and Testing Company Pty Limited Australian Refined Alloys Pty Limited (50% joint venture interest) Australia Refined Allow (Sales) Pty Ltd (50% joint venture interest) LMS Energy Pty Ltd (50% indirect through a 50% JV) LMS generation Pty Limited (50% joint venture interest) Consolidated Extrusions Pty Limited (33.3% joint venture interest) Consolidated Extrusions (Management) Pty Limited (33.3% joint venture interest) Renewable Electricity Pty Ltd (formerly Gas Energy Power Pty Ltd) (50% indirect through 50% JV) Swanbank Gas Pty Ltd (50% indirect through 50% JV)

Belgium

Sims Recycling Solutions NV

Canada

Sims Group Canada Holdings Limited Sims Recycling Solutions Canada Ltd Accu-Shred Limited Richmond Steel Recycling Limited (50% joint venture interest)

France Sims Recycling Solutions SARL

Germany

Sims Group German Holdings GmbH Sims M+R GmbH Sims Technorecyle GmbH

Hong Kong, China Sims Metal Management Asia Limited (formerly Sims Asia Holdings Limited)

India

Trishyiraya Recycling India Private Ltd (99% indirect / 1% direct)

Mauritius Sims Group Mauritius Limited

The Netherlands Mirec BV Sims Recycling Solutions Cooperatief B.A.

New Zealand

Simsmetal Industries Limited Sims E-Recycling (NZ) Limited Sims Pacific Metals Limited (50% joint venture interest) Extruded Metals (New Zealand) Limited (33.3% joint venture interest)

Papua New Guinea PNG Recycling Limited

Scotland

Sims Recycling Solutions Limited Sims Recycling Solutions UK Group Limited

Singapore

Sims Recycling Solutions Pte Ltd (formerly Recycling Solutions Pte Ltd)

Spain Life Cycle Services Iberia SL (30% joint venture interest)

Sweden Sims Recycling Solutions AB (formerly Mirec AB) United Kingdom All Metal Recovery Limited All Metal Recovery Cradley Heath Limited ER Coley (Steel) Limited ER Coley (Cast) Limited Evans & Mondon Limited Life Cycle Services Limited Recommit Limited Sims Cymru Limited Sims Group UK Holdings Limited Sims Group UK Intermediate Holdings Limited Sims Group UK Limited Sims Group UK Pension Trustees Limited Sims Recycling Solutions UK Holdings Limited United Castings Limited C Herring & Son Limited

United States Arizona

Metal Management Arizona, L.L.C.

Colorado

Metal Management West, Inc.

Delaware

Sims Metal Management USA GP Sims Group USA Holdings Corporation Sims Group USA Corporation SHN Co, LLC HNE Recycling LLC HNW Recycling LLC Simsmetal East LLC Simsmetal West LLC

Delaware (continued) Sims Group Global Trade Corporation Dover Barge Company Schiabo Larovo Corporation Sims Municipal Recycling of New York, LLC Metal Management, Inc. Metal Dynamics Detroit LLC Metal Dynamics Indianapolis LLC Metal Dynamics LLC Metal Management Aerospace, Inc. Metal Management Alabama, Inc. Metal Management Connecticut, Inc. Metal Management Mississippi, Inc. Metal Management New Haven, Inc. Metal Management Pittsburgh, Inc. Metal Management Proler Southwest, Inc. SMM-North America Trade Corporation (formerly Metal Management S&A Holdings, Inc.) Metal Management West Coast Holdings, Inc. MM Metal Dynamics Holdings, Inc. Naparano Iron & Metal, Inc. New York Recycling Ventures, Inc. Proler Southwest GP, Inc. Reserve Iron & Metal Limited Partnership Metal Management Nashville, LLC (50% joint venture interest) SA Recycling LLC (50% joint venture interest) Port Albany Ventures LLC (50% joint venture interest Rondout Iron & Metal Company, LLC (50% joint venture interest)

Florida

Global Investment Recovery, Incorporated

Illinois

Sims Recycling Solutions Holdings Inc. Sims Recycling Solutions, Inc. CIM Trucking, Inc. Metal Management Indiana, Inc. Metal Management Midwest, Inc.

New Jersey Metal Management Northeast, Inc.

North Carolina

North Carolina Resource Conservation LLC

Ohio

Metal Management Ohio, Inc.

Tennessee

Metal Management Memphis, L.L.C.

Texas

Proler Southwest LP

EX-12.1 c53813exv12w1.htm EX-12.1

Exhibit 12.1

CERTIFICATIONS

I, Daniel W. Dienst, certify that:

1. I have reviewed this annual report on Form 20-F of Sims Metal Management Limited;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

1. The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

Date: November 12, 2009

/s/ Daniel W. Dienst

Daniel W. Dienst Group Chief Executive Officer

EX-12.2 c53813exv12w2.htm EX-12.2

Exhibit 12.2

CERTIFICATIONS

I, Robert C. Larry, certify that:

1. I have reviewed this annual report on Form 20-F of Sims Metal Management Limited;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

1. The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

Date: November 12, 2009

/s/ Robert C. Larry Robert C. Larry Group Chief Financial Officer

EX-13.1 c53813exv13w1.htm EX-13.1

Exhibit 13.1

Certification Pursuant to Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 18 U.S.C. Section 1350

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of Sims Metal Management Limited (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Annual Report on Form 20-F for the year ended June 30, 2009 (the “Form 20-F”) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 20-F fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Daniel W. Dienst Daniel W. Dienst Group Chief Executive Officer November 12, 2009

/s/ Robert C. Larry Robert C. Larry Group Chief Financial Officer November 12, 2009

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-15.1 c53813exv15w1.htm EX-15.1

Exhibit 15.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-156922 and No. 333-149717) of Sims Metal Management Limited of our report dated August 28, 2009 relating to the financial statements and the effectiveness of internal control over financial reporting, which appears in this Form 20-F.

PricewaterhouseCoopers Sydney, New South Wales

November 11, 2009

EX-15.2 c53813exv15w2.htm EX-15.2

Exhibit 15.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (No. 333-156922 and No. 333-149717) of Sims Metal Management Limited of our report dated July 31, 2009 relating to the consolidated financial statements of SA Recycling, LLC, which appears in this Form 20-F.

PricewaterhouseCoopers LLP Irvine, California

November 9, 2009