Exhibit 10.46

 

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JAMES R. MICHAUD

   CLIFFS NATURAL RESOURCES INC.

Senior Vice President – Human Resources

   200 Public Square, Suite 3300, Cleveland, OH 44114-2315

P. 216.694.5533 james.michaud@cliffsnr.com

   P 216.694.5700 cliffsnaturalresources.com

June 7, 2011

William R. Calfee

3911-3 Lander Road

Chagrin Falls, Ohio 44022

Dear Mr. Calfee:

Due to your planned retirement on July 1, 2011, the Compensation & Organization
Committee of the Board of Directors has approved a consulting arrangement and
special treatment of your Long-Term Incentive (LTI) and Management Performance
Incentive (MPI) awards.

The specific elements include:

 

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One year consulting agreement paid at a monthly rate of $8,000.00.

 

  •  

The consulting agreement would be renewable after 12 months; by agreement of
both you and a designated representative of Cliffs Natural Resources Inc. (the
“Company”). The parties commit to give each other at least 60 days advance
written notice of intent to renew this agreement.

 

  •  

Consulting duties include:

 

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Assistance in the development of the new commercial organization,

 

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Working on the Arcelor Mittal Issues, and

 

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Any other assignments that help add value to the organization.

 

  •  

Your consulting duties should not prevent you from experiencing a “separation
from service” for purposes of nonqualified deferred compensation plans of the
Company that are subject to the requirements of Section 409A of the Internal
Revenue Code (the “Code”) because we anticipate that the level of consulting
services you will be asked to perform will not exceed 20 percent of the average
level of services you performed during the last few years of your employment.

 

  •  

Upon signing the consulting agreement and prior to your planned retirement, the
Company will make a one-time payment of $30,000 to you.

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Your outstanding LTI awards for the 2009 - 2011 and 2010 - 2012 LTI Incentive
Periods will not be prorated as a result of your retirement and the amounts
payable thereunder will be based on the degree of actual achievement and will be
determined and paid in the normal course following the completion of each LTI
cycle. You will not forfeit any portion of the Performance Shares or the
Restricted Share Units (RSUs) granted to you for both cycles solely as a result
of your retirement, notwithstanding Section 8.4 or 10.5 of the Amended and
Restated Cliffs 2007 Incentive Equity Plan, as amended, or any other provision
of that Plan or the applicable award agreements that would have required such
proration or forfeiture. In effect, your Performance Shares and RSUs will be
settled as though you remained employed throughout the entire incentive period
and will be based on the level of the Company’s actual performance when measured
against the applicable performance objectives over the entire applicable
incentive period. This additional vesting will not accelerate the date of
payment of such awards, and the Company will make such payments to you in a
manner that complies with Section 409A of the Code.

 

  •  

Your 2011 MPI Plan award will not be prorated on account of your retirement.
Instead, you will be paid the 2011 MPI award as though you remained employed
through the date the 2011 MPI awards are paid to other senior executives. The
Organizational MPI Grant will be calculated based upon the Company’s actual
performance during 2011 when measured against the twelve performance criteria
listed in the March 8, 2011 MPI award letter from Joe Carrabba. The additional
vesting and the waiving of the requirement that you be employed on the date of
payment of the 2011 MPI award provided by this paragraph will not accelerate the
date of payment of the 2011 MPI award, and the Company will make such payment to
you in a manner that complies with Section 409A of the Code.

 

  •  

The Company will provide you with additional payments, if necessary, equal to
the amount of any additional tax or interest incurred or assessed, including an
amount equal to the income tax on such additional payments, if the 2009-2011 LTI
award, the 2010-2012 LTI award, the 2011 MPI award or any payments thereof do
not comply with Section 409A of the Code. The Company shall make such additional
payments to you by the end of the calendar year following the calendar year in
which you remit the additional taxes or interest.

Bill, please sign below to indicate your acceptance of the consulting
arrangement and special treatment of your LTI and MPI awards described above. A
separate agreement detailing your responsibilities and those of the Company in
your consulting role will be supplied as well.

 

Sincerely, /s/ James R. Michaud

James R. Michaud

Senior Vice President – Human Resources

 

Accepted:   /s/ William R. Calfee   William R. Calfee Date:   June 7, 2011

 

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