Document:

Filed by Automated Filing Services Inc. (604) 609-0244 - Ikona Gear International, Inc. - Exhibit 4.1

Exhibit 4.1

Form of Broker Warrant 

THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS
WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”) NOR UNDER ANY STATE SECURITIES LAW AND MAY NOT BE PLEDGED, SOLD,
ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNTIL (1) A REGISTRATION
STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE
STATE SECURITIES LAW OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH NOTE MAY BE PLEDGED, SOLD,
ASSIGNED, HYPOTHECATED OR TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES LAWS. 

THE HOLDER OF THIS WARRANT MUST NOT SELL THIS WARRANT OR THE
SHARES ISSUABLE UPON CONVERSION OF THIS WARRANT TO A RESIDENT OF BRITISH
COLUMBIA, CANADA, INTO BRITISH COLUMBIA, CANADA OR THROUGH A MARKET IN BRITISH
COLUMBIA, CANADA BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE
DISTRIBUTION DATE. 

________________________________________ 
IKONA GEAR
INTERNATIONAL, INC. 
1850 HARTLEY AVENUE, UNIT #1 
COQUITLAM, BC V3K 7A1

CANADA 

STOCK PURCHASE WARRANT 

	Warrant No.: ____	Right to Purchase: _________________
	Date: 	  

          THIS
CERTIFIES THAT, for value received, ________________________________
(the “Holder”), is entitled to purchase from IKONA GEAR INTERNATIONAL,
INC., a Nevada corporation (the “Company”), at any time from
___________ until 5:00 p.m. (EST) on ____________ [5 years]
___________ [number] fully paid and nonassessable shares of the Company’s
common stock, par value $0.00001 per share (“Common Stock”), at an
exercise price of $0.50 per share (the “Exercise Price”), as adjusted.

          1.      The
Company is issuing this Warrant to the Holder pursuant to the engagement
agreement dated February 21, 2006 between the Company and Westminster Securities
Corporation (the “Engagement Letter”). 

          2.      (a)      To
exercise this Warrant or any part of this Warrant, the Holder must deliver to
the Company (collectively, the “Exercise Documentation”): (i) a completed
exercise agreement, a form of which is attached hereto; (ii) this Warrant; and
(iii) a check or wire transfer payable to the Company in an amount equal to the
product of the exercise price and the number of shares the Holder desires to
purchase. The Company will, without charge, use its best efforts to issue
certificates for shares of Common Stock purchased upon exercise of this Warrant
within five days after receipt of the Exercise Documentation. Unless this
Warrant has expired, or all of the purchase rights represented by this Warrant
have been exercised, the Company will also prepare a new Warrant, substantially
identical to this Warrant, representing the rights formerly represented by this
Warrant which have not expired or been exercised.

          
Notwithstanding the foregoing, this Warrant my be exercised only by persons who
represent at the time of exercise: (i) that they are the original recipient
hereof, (ii) that they are not located in the United States, are not a “U.S.
Person” (as defined in Rule 902 under the Securities Act, and are not acquiring
the Common Stock for the account or benefit of a U.S. Person or a person in the
United States, or (iii) that they have delivered the Exercise Documentation..

                    (b)      At
  any time this Warrant may also be exercised, in whole or in part, at such time
  by means of a “cashless exercise” in which the Holder shall be entitled
  to receive a certificate for the number of shares of Common Stock equal to the
  quotient obtained by dividing [(A-B) (X)] by (A), where:

	 	(A) = 	
      the closing bid price on the trading day preceding the
      date of such election; 

	 	(B) = 	
      the Exercise Price of the Warrants, as adjusted; and
    

	 	(X) = 	
      the number of shares of Common Stock issuable upon
      exercise of the Warrants in accordance with the terms of this Warrant.
    

          3.      The
Company will at all times reserve and keep available for issuance upon the
exercise of this Warrant such number of its authorized but unissued shares of
Common Stock as will be sufficient to permit the exercise in full of this
Warrant, and upon such issuance such shares of Common Stock will be validly
issued, fully paid and nonassessable. 

          4.      This
Warrant does not and will not entitle the Holder to any voting rights or other
rights as a stockholder of the Company.

          5.      Certain
Adjustments.

          (a)     
Stock Splits, etc. The number and kind of securities purchasable upon the
exercise of this Warrant and the exercise price shall be subject to adjustment
from time to time upon the happening of any of the following. In case the
Company shall (i) pay a dividend in shares of Common Stock or make a
distribution in shares of Common Stock to holders of its outstanding Common
Stock, (ii) subdivide its outstanding shares of Common Stock into a greater
number of shares, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock, or (iv) issue any shares of its
capital stock in a reclassification of the Common Stock, then the number of
shares purchasable upon exercise of this Warrant immediately prior thereto shall
be adjusted so that the Holder shall be entitled to receive the kind and number
of shares or other securities of the Company which it would have owned or have
been entitled to receive had such Warrant been exercised in advance thereof.
Upon each such adjustment of the kind and number of shares or other securities
of the Company which are purchasable hereunder, the Holder shall thereafter be
entitled to purchase the number of shares or other securities resulting from
such adjustment at an exercise price per share or other security obtained by
multiplying the exercise price in effect immediately prior to such adjustment by
the number of shares purchasable pursuant hereto immediately prior to such
adjustment and dividing by the number of shares or other securities of the
Company resulting from such adjustment. An adjustment made pursuant to this
paragraph shall become effective immediately after the effective date of such
event retroactive to the record date, if any, for such event. 

          (b)      Subsequent
Equity Sales. If the Company or any subsidiary thereof, as applicable, at
any time while this Warrant is outstanding, shall offer, sell, grant any option
to purchase or offer, sell or grant any right to reprice its securities, or
otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock or any securities of the
Company or the subsidiaries which would entitle the holder thereof to acquire at
any time Common Stock, including without limitation, any debt, preferred stock,
rights, options, warrants or other instrument that is at any time convertible
into or exchangeable for, or otherwise entitles the holder thereof to receive,
Common Stock (“Common Stock Equivalents”) at an effective price per share
less than the then exercise price of this Warrant (such lower price, the
“Base Share Price” and such issuances collectively, a “Dilutive
Issuance”), as adjusted hereunder (if the holder of the Common Stock or
Common Stock Equivalents so issued shall at any time, whether by operation of
purchase price adjustments, reset provisions, floating conversion, exercise or
exchange prices or otherwise, or due to warrants, options or rights per share
which is issued in connection with such issuance, be entitled to receive shares
of Common Stock at an effective price per share which is less than the exercise
price of this Warrant, such issuance shall be deemed to have occurred for less
than the exercise price), then, the Exercise Price shall be reduced and shall be
the same price as the lowest such effective price per share in connection with
such issuance. Such adjustments shall be made whenever such Common Stock or
Common Stock Equivalents are issued. The Company shall notify the Holder in
writing, no later than the three business days following the issuance of any
Common Stock or Common Stock Equivalents subject to this section, indicating
therein the applicable issuance price, or the applicable reset price, exchange
price, conversion 

price and other pricing terms (such notice the “Dilutive
Issuance Notice”). Notwithstanding the foregoing, no adjustments, alternate
consideration nor notices shall be made, paid or issued under this Section in
respect of an issuance of (a) shares of Common Stock or options to employees,
officers or directors of the Company pursuant to any stock or option plan duly
adopted by a majority of the non-employee members of the Board of Directors of
the Company or a majority of the members of a committee of non-employee
directors established for such purpose, (b) securities upon the exercise of or
conversion of any securities issued hereunder, and (c) securities issued
pursuant to acquisitions or strategic transactions, provided any such issuance
shall only be to a person or entity which is, itself or through its
subsidiaries, an operating company in a business synergistic with the business
of the Company and in which the Company receives benefits in addition to the
investment of funds, but shall not include a transaction in which the Company is
issuing securities primarily for the purpose of raising capital or to an entity
whose primary business is investing in securities. 

          (c)      Pro
Rata Distributions. If the Company, at any time prior to the termination
date or exercise date of this Warrant, shall distribute to all holders of Common
Stock (and not to Holders of the Warrants) evidences of its indebtedness or
assets or rights or warrants to subscribe for or purchase any security other
than the Common Stock (which shall be subject to the above section), then in
each such case the exercise price of this Warrant shall be adjusted by
multiplying the exercise price in effect immediately prior to the record date
fixed for determination of stockholders entitled to receive such distribution by
a fraction of which the denominator shall be the closing bid price determined as
of the record date mentioned above, and of which the numerator shall be such
closing bid price on such record date less the then per share fair market value
at such record date of the portion of such assets or evidence of indebtedness so
distributed applicable to one outstanding share of the Common Stock as
determined by the Board of Directors in good faith. In either case the
adjustments shall be described in a statement provided to the Holders of the
portion of assets or evidences of indebtedness so distributed or such
subscription rights applicable to one share of Common Stock. Such adjustment
shall be made whenever any such distribution is made and shall become effective
immediately after the record date mentioned above. 

          (d)      Reorganization,
Reclassification, Merger, Consolidation or Disposition of Assets. In case
the Company shall reorganize its capital, reclassify its capital stock,
consolidate or merge with or into another corporation (where the Company is not
the surviving corporation or where there is a change in or distribution with
respect to the Common Stock of the Company), or sell, transfer or otherwise
dispose of all or substantially all its property, assets or business to another
corporation and, pursuant to the terms of such reorganization, reclassification,
merger, consolidation or disposition of assets, shares of common stock of the
successor or acquiring corporation, or any cash, shares of stock or other
securities or property of any nature whatsoever (including warrants or other
subscription or purchase rights) in addition to or in lieu of common stock of
the successor or acquiring corporation (“Other Property”), are to be
received by or distributed to the holders of Common Stock of the Company, then
the Holder shall have the right thereafter to receive upon exercise of this
Warrant, the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and Other
Property receivable upon or as a result of such reorganization,
reclassification, merger, consolidation or disposition of assets by a holder of
the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such event. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the successor
or acquiring corporation (if other than the Company) shall expressly assume the
due and punctual observance and performance of each and every covenant and
condition of this Warrant to be performed and observed by the Company and all
the obligations and liabilities hereunder, subject to such modifications as may
be deemed appropriate (as determined in good faith by resolution of the Board of
Directors of the Company) in order to provide for adjustments of shares for
which this Warrant is exercisable which shall be as nearly equivalent as
practicable to the adjustments provided for in this Section. For purposes of
this Section, “common stock of the successor or acquiring corporation” shall
include stock of such corporation of any class which is not preferred as to
dividends or assets over any other class of stock of such corporation and which
is not subject to redemption and shall also include any evidences of
indebtedness, shares of stock or other securities which are convertible into or
exchangeable for any such stock, either immediately or upon the arrival of a
specified date or the happening of a specified event and any warrants or other
rights to subscribe for or purchase any such stock. The foregoing provisions of
this Section shall similarly apply to successive reorganizations,
reclassifications, mergers,consolidations or disposition of assets. 

                    
Whenever the number of shares or number or kind of securities or other property
purchasable upon the exercise of this Warrant or the exercise price is adjusted,
as herein provided, the Company shall give notice 

thereof to the Holder, which notice shall state the number of
shares (and other securities or property) purchasable upon the exercise of this
Warrant and the exercise price of such shares (and other securities or property)
after such adjustment, setting forth a brief statement of the facts requiring
such adjustment and setting forth the computation by which such adjustment was
made. 

          6.      Whenever
  the number of shares or number or kind of securities or other property purchasable
  upon the exercise of this Warrant or the exercise price is adjusted, as herein
  provided, the Company shall give notice thereof to the Holder, which notice
  shall state the number of shares (and other securities or property) purchasable
  upon the exercise of this Warrant and the exercise price of such shares (and
  other securities or property) after such adjustment, setting forth a brief statement
  of the facts requiring such adjustment and setting forth the computation by
  which such adjustment was made.

          7.      Notice
of Corporate Action. If at any time: 

          (a)      the
Company shall take a record of the holders of its Common Stock for the purpose
of entitling them to receive a dividend or other distribution, or any right to
subscribe for or purchase any evidences of its indebtedness, any shares of stock
of any class or any other securities or property, or to receive any other right,
or 

          (b)      there
shall be any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any consolidation or
merger of the Company with, or any sale, transfer or other disposition of all or
substantially all the property, assets or business of the Company to, another
corporation or, 

          (c)      there
shall be a voluntary or involuntary dissolution, liquidation or winding up of
the Company,

          then,
in any one or more of such cases, the Company shall give to the Holder (i) at
least 20 days’ prior written notice of the date on which a record date shall be
selected for such dividend, distribution or right or for determining rights to
vote in respect of any such reorganization, reclassification, merger,
consolidation, sale, transfer, disposition, liquidation or winding up, and (ii)
in the case of any such reorganization, reclassification, merger, consolidation,
sale, transfer, disposition, dissolution, liquidation or winding up, at least 20
days’ prior written notice of the date when the same shall take place. Such
notice in accordance with the foregoing clause also shall specify the date on
which any such record is to be taken for the purpose of such dividend,
distribution or right, the date on which the holders of Common Stock shall be
entitled to any such dividend, distribution or right, and the amount and
character thereof, and the time, if any such time is to be fixed, as of which
the holders of Common Stock shall be entitled to exchange their shares for
securities or other property deliverable upon such disposition, dissolution,
liquidation or winding up. Each such written notice shall be sufficiently given
if addressed to Holder at the last address of Holder appearing on the books of
the Company and delivered in accordance with this Section 7. Delivery shall be
deemed to be made upon the mailing, by first class mail, of all notices required
to be delivered hereunder. 

          8.      The
construction, validity and interpretation of this Warrant will be governed by
the laws of the State of New York, without giving effect to conflict of laws
principles. 

          IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested
by its duly authorized officers under its corporate seal. 

	 	IKONA GEAR INTERNATIONAL, INC. 	ATTEST: 
	 	  	  
	 	By: _______________________________________
    	 
    
	 	Name: Laith Nosh 	Secretary 
	 	Title: President and CEO 	  

EXHIBIT 

EXERCISE AGREEMENT 

	To: 	Ikona Gear International, Inc.

                    (1)      The
undersigned hereby elects to purchase ________ shares of Ikona Gear
International, Inc. pursuant to the terms of the attached Warrant (only if
exercised in full), and tenders herewith payment of the exercise price in full,
together with all applicable transfer taxes, if any. 

                    (2)      Payment
shall take the form of (check applicable box): 

[ ] in lawful money of the United
States; or 

[ ] the cancellation of such number of
shares as is necessary, in accordance with the formula set forth in subsection
2(b), to exercise this Warrant with respect to the maximum number of Warrant
Shares purchasable pursuant to the cashless exercise procedure set forth in
subsection 2(b). 

                    (3)      Please
issue a certificate or certificates representing said shares in the name of the
undersigned or in such other name as is specified
below: 
                              
_______________________________

                    (4)      The
undersigned hereby represents, as of the date hereof (please check one box):

[ ] we are the original recipient of
the attached Warrant, 

[ ] we are not located in the United
States, we are not a “U.S. Person” (as defined in Rule 902 under the Securities
Act, and we are not acquiring the Common Stock for the account or benefit of a
U.S. Person or a person in the United States, or

[ ] we have delivered the Exercise
Documentation. 

The shares shall be delivered to the following: 

_______________________________

_______________________________

_______________________________

[HOLDER] 

By:
______________________________
       Name:

       Title: 

Dated: _______________________WWW.EXFILE.COM, INC. -- 14281 -- SCHNITZER STEEL INDUSTRIES, INC. -- EXHIBIT 10.1 TO FORM 8-K

    EXHIBIT
      10.1

    

    SCHNITZER
      STEEL INDUSTRIES, INC.

    EMPLOYMENT
      AGREEMENT

     

     

    Tamara
      L.
      Adler (Lundgren)—Executive

    

     

    Schnitzer
      Steel Industries, Inc.—Company

    PO
      Box
      10047

    Portland,
      OR 97296-0047

    

    In
      consideration of the mutual covenants contained herein, and other good and
      valuable consideration, the Company and Executive agree as follows.

     

    1.  Effective
      Date and Term.
      The
      effective date of this Agreement is March 24, 2006, and this Agreement governs
      the terms and conditions of Executive’s employment through August 31, 2009. This
      Agreement replaces and supersedes the Agreement of Initial Employment Terms
      dated August 4, 2005 between the Company and Executive. This Agreement has
      been
      approved by the Compensation Committee of the Company’s Board of Directors (the
“Compensation
      Committee”.

     

    2.  Employment
      At-Will.
      The
      Company employs Executive as Executive Vice President, Strategy &
Investments, and President—Shared Services of the Company (EVPS&I—PSS) on
      the terms and conditions set forth in this Agreement.
      Executive serves as EVPS&I—PSS of the Company at the pleasure of the
      Company, and reports to the President & Chief Executive Officer. Executive’s
      employment is at will and may be terminated at any time, for any reason or
      no
      reason, upon notice by either the Company or Executive, subject to the
      obligations of the Company and Executive as provided in this Agreement.
      Termination of Executive as EVPS&I—PSS, for any reason, shall constitute the
      resignation by Executive, effective upon such termination as an officer of
      the
      Company. Upon request, Executive shall provide the Company with additional
      written evidence of any such resignation

     

    3.  Change
      in Control Severance Agreement.
      The
      Company and the Executive have entered into a Change in Control Severance
      Agreement dated March 24, 2006 (the “Change
      in Control Agreement”).

     

    4.  Annual
      Salary and Bonus.

     

    (a)  Base
      Salary.
      Beginning January 1, 2006, Executive’s base salary (the
      “Base
      Salary”)
      shall
      be at the annual rate of $550,000.
      Base
      Salary shall be payable in installments on regular Company paydays, subject
      to
      withholding for taxes and other proper deductions. Base Salary for any partial
      period of employment shall be prorated. Executive’s performance and the amount
      of the Base Salary shall be reviewed annually in connection with the Company’s
      normal compensation review and bonus cycle for executive officers, and the
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Base
      Salary may be increased from time to time in the sole discretion of the
      President & Chief Executive Officer. 

     

    (b)  Annual
      Performance Bonus for Fiscal Year Ended August 31, 2006.
      Executive’s target cash bonus for the fiscal year ending August 31, 2006 shall
      be $550,000. The actual amount of Executive’s bonus for this period shall be
      determined by the President & Chief Executive Officer in his sole
      discretion, subject to review by the Compensation Committee, based on his
      judgment regarding Executive’s performance during fiscal year 2006, and may be
      more or less than the target amount. There is no pre-determined minimum or
      maximum amount of the bonus. Bonus payment for performance during fiscal year
      2006 will be on the basis of a review and discussion with the President &
Chief Executive Officer, and will include consideration of a variety of
      financial and organizational objectives and the overall performance of the
      Company, as well as the achievement of personal goals agreed with the President
      & Chief Executive Officer. The bonus provided for in this Section 4(b) shall
      be payable to Executive on a date selected by the Company between September
      1
      and November 15, 2006, and is subject to withholding for taxes and other proper
      deductions. 

     

    (c)  Annual
      Performance Bonus for Fiscal Years ending August 31, 2007, 2008 and
      2009.
      At the
      beginning of fiscal year 2007, 2008 and 2009 (and in any event no later than
      90
      days into the fiscal year) the President & Chief Executive Officer will
      establish a bonus program for that fiscal year for Executive that will have
      two
      components: a component based on objective Company financial measures and a
      component based on management objectives (MBO). The first component will set
      forth objective Company financial performance criteria that will determine
      the
      amount of Executive’s bonus. The plan will specify bonus amounts higher and
      lower than the target for Company performance based on the predetermined
      objectives. The second component will be based on MBO performance criteria.
      At
      the beginning of each fiscal year the President & Chief Executive Officer,
      in consultation with Executive, will establish management objectives for
      Executive which will be clearly understood and measurable. The plan will specify
      bonus amounts higher or lower than the target for performance based on the
      objectives. At the end of the fiscal year, the President & Chief Executive
      Officer will review Executive’s performance, and determine the extent to which
      the objectives have been met and the applicable bonus amount. For FY 2007,
      the
      target annual bonus under the combined bonus plan will be 1x Base Salary, and
      the Company financial performance component will apply to 50% of the bonus
      target and the MBO component will apply to 50% of the bonus target. The same
      shall apply for FY2008 and 2009 unless otherwise determined by the President
      & Chief Executive Officer in consultation with Executive. The bonus for a
      fiscal year shall be payable to Executive on a date selected by the Company
      between September 1 and November 15 , 2006 in the next fiscal year, and is
      subject to withholding for taxes and other proper deductions.

     

    5.  Options
      and Other Benefits.

     

    (a)  Option
      Grants.
      The
      amount and terms of any stock option grants after the date of this Agreement
      shall be in the discretion of the Compensation Committee, as recommended to
      the
      Committee by the President & Chief Executive Officer.

     

    (b)  Benefits.
      Executive shall be entitled to participate in the Company’s employee benefit
      plans, insurance, executive medical coverage, sick leave, holidays, auto
      allowance and such other benefits as the Company from time to time may generally
      provide to its 

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    most
      senior officers, except that Executive shall not be a participant in the
      Company’s Supplemental Executive Retirement Bonus Plan (“SERBP”)
      or the
      Company’s Economic Value Added Bonus Program. If Executive’s employment
      continues beyond June 1, 2006, Executive will also become eligible for
      retirement benefits, including the SERBP, subject to the Compensation
      Committee’s review and approval regarding the terms and conditions of such
      benefits.

     

    (c)  Long
      Term Incentive Plan.
      Executive is eligible to participate in the Company’s long term incentive
      programs (“LTIP”),
      and
      awards to Executive under the LTIP will be made at the discretion of the
      Compensation Committee, as recommended by the President & Chief Executive
      Officer, in accordance with the modified LTIP now in effect for the Company,
      or
      as later modified by the Company.

     

    6.  Definitions.
      The
      following terms shall have the following meanings for purposes of this
      Agreement:

     

    (a)  “Cause”
shall
      mean (i) the willful and continued failure by Executive to perform
      substantially her assigned duties with the Company (other than any such failure
      resulting from her incapacity due to physical or mental illness) after a demand
      for substantial performance is delivered to Executive
      by the
      President & Chief Executive Officer of the Company which specifically
      identifies the manner in which the President & Chief Executive Officer
      believes that Executive has not substantially performed her duties or (ii)
      the
      willful engaging by Executive in illegal conduct which is materially and
      demonstrably injurious to the Company. For purposes of this Section 6(a) (ii),
      no act, or failure to act, on Executive’s
      part
      shall be considered “willful” unless done, or omitted to be done, by Executive
      in knowing bad faith and without reasonable belief that her action or omission
      was in, or not opposed to, the best interests of the Company. Any act, or
      failure to act, based upon authority given pursuant to direction from the
      President & Chief Executive Officer or based upon the advice of counsel for
      the Company shall be conclusively presumed to be done, or omitted to be done,
      by
      Executive in good faith and in the best interests of the Company.
      Notwithstanding the foregoing, Executive shall not be deemed to have been
      terminated for Cause unless and until there shall have been delivered to
      Executive a copy of a letter from the President and Chief Executive Officer,
      finding (after reasonable notice to her and an opportunity for her, together
      with her counsel, to be heard) that in his good faith opinion she was guilty
      of
      the conduct set forth above in (i) or (ii) of this paragraph (a) and specifying
      the particulars thereof in detail. 

     

    (b)  “Disability”
shall
      mean Executive’s
      absence from her duties with the Company on a full-time basis for one hundred
      eighty (180) consecutive days as a result of her incapacity due to physical
      or
      mental illness, unless within thirty (30) days after notice of termination
      is
      given to Executive following such absence she shall have returned to the
      full-time performance of her duties.

     

    (c)  “Good
      Reason”
shall
      mean termination by Executive of Executive’s employment with the Company based
      on any of the following events:

     

    (i)  a
      substantive change or diminution in Executive’s status, title, positions or
      responsibilities as EVPS&I—PSS or the assignment to Executive of any duties
      or responsibilities which are inconsistent with such status, title or positions,
      or any removal of

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    Executive
      from or any failure to reappoint or reelect Executive to such positions, except
      in connection with the termination of Executive’s employment for Cause or
      Disability or as a result of Executive’s death or by Executive other than for
      Good Reason;

     

    (ii)  a
      reduction by the Company in Executive’s base salary;

     

    (iii)  the
      failure by the Company to provide to Executive the compensation and benefits
      as
      provided in Section 4 of this Agreement;

     

    (iv)  the
      failure by the Company to provide and credit Executive with the number of paid
      vacation days to which Executive is then entitled in accordance with the
      Company’s normal vacation policy;

     

    (v)  
      the
      Company’s requiring Executive to relocate her residence, or change her base
      office locations from either of the current locations in New York and Portland
      (or other offices in reasonable proximity within those cities), absent agreement
      with the Executive, except for required travel on the Company’s business to an
      extent substantially consistent with the business travel obligations which
      Executive undertook as of the date of this Agreement;

     

    (vi)  the
      failure by the Company to obtain from any Successor (as defined in Section
      10 of
      this Agreement) the assent to this Agreement contemplated by Section 10;
      or

     

    (vii)  the
      failure by the Company to pay Executive any portion of Executive’s current
      compensation, to credit any deferred compensation plan account of Executive
      in
      accordance with Executive’s previous election, or to pay Executive any portion
      of an installment of deferred compensation under any plan in which Executive
      participated, within seven (7) days of the date such compensation is
      due.

     

    (viii)    
      Notwithstanding
      any provision in this Agreement to the contrary, Executive may terminate her
      employment for “Good Reason” only if (1) within 30 days after notice to
      Executive of the occurrence of any of the circumstances giving rise to “Good
      Reason,” Executive gives written notice to the Company of Executive’s believe
      that Good Reason exists and of her intention to terminate her employment for
      Good Reason and (2) within 30 days of such notice from Executive the
      circumstances giving rise to Good Reason are not fully corrected.

     

    7.  Effect
      of Termination of Employment.

     

    (a)  Termination by
      the Company for Cause or by
      Executive
      without Good Reason.
      If the
      Company terminates Executive’s employment for Cause
      or
      Executive terminates her employment
      without
      good reason, Executive shall be entitled to receive only (i)
      the
      Base
      Salary and any other compensation or benefits which have been earned or become
      payable as of the date of termination but which have not yet been paid to
      Executive,
      (ii)
      all paid time off accrued but untaken through the effective date of such
      termination, and (iii) reimbursement of expenses incurred through the effective
      date of such termination pursuant to 

     

     

    
      
        
        

      

      
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    the
      Company normal expense reimbursement policy. The amounts described in clauses
      (i) through (iii) of the foregoing are referred to as the “Accrued
      Obligations.”

     

    (b)  Termination
      by the Company Without Cause
      or by Executive for Good Reason.
      If
      the
      Company terminates Executive’s employment without Cause
      or
      Executive terminates her employment for Good Reason at any time before September
      1, 2009 and not under circumstances that would give rise to severance payments
      to Executive under the Change in Control Agreement: 

     

    (i)  Executive
      shall be entitled to receive the Accrued
      Obligations; 

     

    (ii)  Executive
      shall be entitled to receive a severance
      payment (subject to applicable taxes and withholding) in
      a lump
      sum in an amount equal to two times Executive’s annualized rate of Base
      Salary
      in
      effect immediately prior to the time of termination
      plus two
      times Executive’s target annual bonus in effect immediately prior to the
      termination;

     

    (iii)  Executive
      shall be paid a prorata portion of the target bonus for the fiscal year in
      which
      the termination occurs (based on the portion of the year worked);
      and

     

    (iv)  all
      options to purchase Company common stock then held by Executive shall become
      immediately vested and exercisable in full and all performance shares and
      restricted stock then held by Executive shall become immediately vested and
      all
      related forfeiture provisions shall lapse.

     

    (c)  Death.
      If
      Executive’s employment is terminated as a result of Executive’s death, Executive
      shall be entitled to receive the Accrued
      Obligations.
      

     

    (d)  Disability.
      If
      Executive’s employment is terminated as a result of Executive’s Disability,
      Executive shall be entitled to receive the Accrued
      Obligations.

     

    (e)  Date
      of Payment.
      Except
      as otherwise provided in this Agreement, all cash payments and lump-sum awards
      required to be made pursuant to the provisions of this Section 7
      shall be
      made no later than the 30th day following the effective date of Executive’s
      termination.

     

    (f)  Release
      of Claims.
      The
      Company shall have the right to require Executive to execute an appropriate
      general release of claims relating to her employment at the Company and
      termination of employment at the Company that could be brought by Executive
      hereunder as a condition to Executive’s receipt of any payments pursuant to this
      Section 7.

     

    (g)  Options,
      Performance Shares and Restricted Stock.
      The
      options, performance shares and restricted stock awarded to Executive by the
      Company shall, in the event of a termination of Executive’s employment, be
      governed by the provisions of the applicable award agreement; provided that
      the
      accelerated vesting provisions of Section 7(b)(iv) shall, if triggered, control
      in the event of any inconsistency with any such agreement. 

     

    (h)  No
      Obligation of Executive to Mitigate.
      The
      amount of any payment provided for in this Section 7 shall not be reduced,
      offset or subject to recovery by the Company 

     

     

    
      
        
        

      

      
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    by
      reason
      of any compensation earned by Executive as the result of employment by another
      employer after the date of termination.

     

    (i)  280G
      Excise Tax Gross Up Provision.
      If
      any of
      the payments provided for in Section 7(b) will be subject to the tax imposed
      by
      section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), or
      any similar tax that may hereafter be imposed (the “Excise Tax”), the Company
      shall pay to Executive at the time any such payment is paid an additional amount
      (the “Gross-Up Payment”) such that the net amount retained by Executive, after
      deduction of any Excise Tax on the payments and any federal, state and local
      income tax and Excise Tax upon the Gross-Up Payment, shall be equal to the
      payment provided for in Section 7(b). For purposes of determining the amount
      of
      the Gross-Up Payment, Executive shall be deemed to pay federal income taxes
      at
      the highest marginal rate of federal income taxation in the calendar year in
      which the Gross-Up Payment is to be made and state and local income taxes at
      the
      highest marginal rate of taxation in the state and locality of Executive’s
      residence on the date of termination, net of the maximum reduction in federal
      income taxes which could be obtained from deduction of such state and local
      taxes. In the event that the Excise Tax is subsequently determined to be less
      than the amount taken into account hereunder, Executive shall repay to the
      Company at the time that the amount of such reduction in Excise Tax is finally
      determined the portion of the Gross-Up Payment directly and indirectly
      attributable to such reduction plus interest on the amount of such repayment
      at
      the rate provided for in section 1274(d) of the Code. In the event that the
      Excise Tax is determined to exceed the amount taken into account hereunder
      (including by reason of any payment the existence or amount of which cannot
      be
      determined at the time of the Gross-Up Payment), the Company shall make an
      additional Gross-Up Payment in respect of such excess (plus any interest payable
      to the taxing authorities with respect to such excess) at the time that the
      amount of such excess is finally determined. The Company shall withhold the
      Excise Tax in accordance with section 4999(b) of the Code, and shall withhold
      federal, state and local income taxes from payments under Section 7(b) and
      Gross-Up Payments as required by law.

     

    8.  Withholding.
      Payment
      of all compensation under this Agreement, including but not limited to the
      Base
      Salary and Annual Performance Bonus, shall be subject to all applicable federal,
      state and local tax withholding.

     

    9.  Attorneys’
      Fees.
      Each
      party shall bear her or its own costs and attorneys’ fees which have been or may
      be incurred in connection with the negotiation of this Agreement. The Company
      shall pay to Executive all reasonable legal fees and related expenses incurred
      by Executive in good faith as a result of Executive seeking to obtain or enforce
      in good faith any right or benefit provided by this Agreement.

     

    10.  
       Successors;
      Binding Agreement.
      

     

    (a)  Upon
      Executive’s written request, the Company will seek to have any Successor (as
      hereinafter defined), by agreement in form and substance satisfactory to
      Executive, assent to the fulfillment by the Company of its obligations under
      this Agreement. For purposes of this Agreement, “Successor” shall mean any
      Person that succeeds to, or has the practical ability to control (either
      immediately or with the passage of time), the Company’s business directly, by
      merger, consolidation or purchase of assets, or indirectly, by purchase of
      the
      Company’s voting securities or otherwise.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    (b)  This
      Agreement shall inure to the benefit of and be enforceable by Executive’s
      personal or legal representatives, executors, administrators, successors, heirs,
      distributees, devisees and legatees. If Executive should die while any amount
      would still be payable to Executive hereunder if Executive had continued to
      live, all such amounts, unless otherwise provided herein, shall be paid in
      accordance with the terms of this Agreement to Executive’s devisee, legatee or
      other designee or, if there be no such designee, to Executive’s
      estate.

     

    11.  
       Survival.
      The
      respective obligations of, and benefits afforded to, the Company and Executive
      as provided in Sections 7, 9 and 15 of this Agreement shall survive termination
      of Executive’s employment and this Agreement.

     

    12.   
       Notice.
      For the
      purposes of this Agreement, notices and all other communications provided for
      in
      this Agreement shall be in writing and shall be deemed to have been duly given
      when delivered or mailed by United States registered mail, return receipt
      requested, postage prepaid and addressed to the address of the Company as set
      forth on the first page of this Agreement or Executive as set forth in the
      Company’s records, provided that all notices to the Company shall be directed to
      the attention of the President & Chief Executive Officer of the Company,
      with a copy to the Secretary of the Company, or to such other address as either
      party may have furnished to the other in writing in accordance herewith, except
      that notice of change of address shall be effective only upon
      receipt.

     

    13.   
       Miscellaneous.
      No
      provision of this Agreement may be modified, waived or discharged unless such
      modification, waiver or discharge is agreed to in a writing signed by Executive
      and the President & Chief Executive Officer of the Company. No waiver by
      either party hereto at any time of any breach by the other party hereto of,
      or
      of compliance with, any condition or provision of this Agreement to be performed
      by such other party shall be deemed a waiver of similar or dissimilar provisions
      or conditions at the same or at any prior or subsequent time. No agreements
      or
      representations, oral or otherwise, express or implied, with respect to the
      subject matter hereof have been made by either party which are not expressly
      set
      forth in this Agreement. The validity, interpretation, construction and
      performance of this Agreement shall be governed by the laws of the State of
      Oregon.

     

    14.   
       Validity.
      The
      invalidity or unenforceability of any provision of this Agreement shall not
      affect the validity or enforceability of any other provision of this Agreement,
      which shall remain in full force and effect.

     

    15.     
      Arbitration.
      Any
      dispute or controversy arising under or in connection with this Agreement shall
      be settled exclusively by arbitration in Portland, Oregon by three arbitrators
      in accordance with the rules of the American Arbitration Association then in
      effect. Judgment may be entered on the arbitrators’ award, which award shall be
      a final and binding determination of the dispute or controversy, in any court
      having jurisdiction; provided, however, that Executive shall be entitled to
      seek
      specific performance of Executive’s right to be paid until the date of
      termination during the pendency of any dispute or controversy arising under
      or
      in connection with this Agreement. The Company shall bear all costs and expenses
      of the arbitrators arising in connection with any arbitration proceeding
      pursuant to this Section 15.

     

    
      
        
        

      

      
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    16.   
       Related
      Agreements.
      To the
      extent that any provision of any other agreement between the Company or any
      of
      its subsidiaries and Executive shall limit, qualify or be inconsistent with
      any
      provision of this Agreement, then for purposes of this Agreement, while the
      same
      shall remain in force, the provision of this Agreement shall control and such
      provision of such other agreement shall be deemed to have been superseded,
      and
      to be of no force or effect, as if such other agreement had been formally
      amended to the extent necessary to accomplish such purpose.

     

    17.  Counterparts.
      This
      Agreement may be executed in several counterparts, each of which shall be deemed
      to be an original, but all of which together will constitute one and the same
      instrument.

     

    Dated:    
      March 24, 2006

     

     

    
      	SCHNITZER STEEL INDUSTRIES,
              INC.	 	 	 
	 	 	 	 
	 	 	 	 
	By  
              /s/ John D. Carter 	 	 	/s/ 
Tamara
              L.Adler (Ludgren)
	
              
                

              

              Name:  John D. Carter 
Title:  
                 President & Chief Executive Officer

            	 	 	
              
Tamara
              L. Adler (Lundgren)

    

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        8

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