Exhibit 10.12



 







EXHIBIT 10.12




CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.




FIRST AMENDMENT TO PELLET SALE AND PURCHASE AGREEMENT




     This FIRST AMENDMENT TO PELLET SALE AND PURCHASE AGREEMENT (the “Amendment”) is entered into,
dated and effective as of December 16, 2004, by and among THE CLEVELAND-CLIFFS IRON COMPANY, an
Ohio corporation (“CCIC”), CLIFFS MINING COMPANY, a Delaware corporation (“CMC”), NORTHSHORE MINING
COMPANY, a Delaware corporation (“Northshore”), CLIFFS SALES COMPANY, an Ohio corporation formerly
known as Northshore Sales Company (“Sales”; CCIC, CMC, Northshore and Sales, collectively,
"Cliffs”), INTERNATIONAL STEEL GROUP INC., a Delaware corporation (“ISG”), ISG CLEVELAND INC., a
Delaware corporation (“ISG Cleveland”), and ISG INDIANA HARBOR INC., a Delaware corporation (“ISG
Indiana Harbor”; ISG, ISG Cleveland and ISG Indiana Harbor, collectively, “Steel”).



RECITALS




     WHEREAS, Cliffs and Steel desire to enter into this Amendment to amend their Pellet Sale and
Purchase Agreement, dated as of April 10, 2002 (the “Agreement”);



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


1. The WHEREAS clause appearing on pages 1 and 2 of the Agreement is hereby deleted and the
following added as a new WHEREAS clause:





     WHEREAS, Cliffs desires to sell to Steel and Steel desires to purchase from Cliffs
certain quantities of grades of iron ore pellets as follows: (i) such grades of iron ore
standard pellets being those produced at the [****] iron ore pellet plant (“[****]
Pellets”), located in [****] (“[****] Mine”); (ii) such grades of iron ore flux pellets
being those produced at the [****] iron ore plant (“[****] Pellets”), located in [****]
(“[****] Mine”); (iii) such grades of iron ore standard pellets being those produced at the
[****] iron ore pellet plant (“[****] Pellets”), located in [****] (“[****] Mine”); (iv)
such grades of iron ore standard pellets being those produced at the [****] iron ore pellet
plant (“[****] Pellets”), located in [****] (“[****] Mine”); (v) such grades of iron ore
partial flux pellets being those produced at the [****] iron ore plant (“[****] Pellets”),
located in [****] (“[****] Mine”); or (vi) such other pellet grades as may be mutually
agreed to by the parties hereto (such [****] Pellets, [****] Pellets, [****] Pellets, [****]
Pellets, [****] Pellets, and other mutually agreed upon pellets collectively being referred
to herein as “Cliffs Pellets”), all on the conditions contained herein.



 









 





CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.



2. Section 4(c) of the Agreement is hereby deleted and the following added as a new Section 4(c):





     (c) With respect to the tonnage of [****] Pellets which Cliffs will have available for
sale to Steel, on or before December 31 of each year Cliffs shall notify Steel in writing as
to the tonnage of [****] Pellets Cliffs shall sell to Steel, which tonnage shall equal
Steel’s Annual Pellet Tonnage Requirements for such year.


3. Section 5(c) of the Agreement is hereby deleted and the following is added as a new Section
5(c):





     (c) The prices for the specific grades of Cliffs Pellets sold and purchased in each of
the years 2003 and 2004 for the Cleveland Works or other dock area designated by Steel
pursuant to Section 8(a), and the Indiana Harbor Works shall be based on the [****] prices
per iron unit as described in Section 5(a) (iii) and 5(b)(ii) above (“[****] prices per iron
unit for each of the Cleveland Works and the Indiana Harbor Works”), which [****] prices per
iron unit for each of the Cleveland Works and the Indiana Harbor Works shall then be
adjusted, up or down, in the year [****] by an amount as determined in accordance with
Section 5(d) below.


4. Sections 5(g)(i)(1) and (2) of the Agreement are hereby deleted and the following is added as
new Sections 5(g)(i)(1) and 5(g)(i)(2):





     (g)(1) In [****], annual special steel pricing payments (“Special Payment”) shall be
made, wherein Cliffs shall pay Steel or Steel shall pay Cliffs, as the case may be, [****].
The amount of the Special Payment shall be determined as follows:




	 	(1)  	If during [****], Steel’s [****], Cliffs shall pay Steel an amount equal to:
(w) the amount [****], (x) multiplied by [****], (y) multiplied by [****], (z)
multiplied by [****].
	 
	 	(2)  	If during [****], Steel’s [****], Steel shall pay Cliffs an amount equal to:
(w) the amount [****], (x) multiplied by [****], (y) multiplied by the [****], (z)
multiplied by the [****].




Page 2 of 7









 











CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.



5. The following is added as a new section 5A:





     5A(a) The prices for specific grades of Cliffs Pellets sold and purchased in each of
the years [****] and thereafter for the Cleveland Works or other dock areas designated by
Steel pursuant to Section 8(a), and Indiana Harbor Works shall be based on [****] Prices as
described in Section 5A(b), below, which [****] Prices for each of the Cleveland Works and
the Indiana Harbor Works shall then be adjusted quarterly, up or down, in the year [****]
and thereafter by an amount as determined in accordance with Section 5A(c) below.




     (b) For purposes of this Section 5A, the [****] Prices per iron unit for Cliffs Pellets
shall be as follows:



Cleveland Works




	 	 	 	 	 	 	 
	 	 	 	 	Expected	 	Estimated
	 	 	[****]	 	Natural	 	Price
	Grade	 	[****] Price	Iron Content	Per Ton
	[****] Flux

	 	$[****]
	 	[****]
	 	$[****]
	[****] Partial Flux

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]






Indiana Harbor Works




	 	 	 	 	 	 	 
	 	 	 	 	Expected	 	Estimated
	 	 	[****]	 	Natural	 	Price
	Grade	 	[****] Price	Iron Content	Per Ton
	[****] Flux

	 	$[****]
	 	[****]
	 	$[****]
	[****] Partial Flux

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]
	[****] Standard

	 	$[****]
	 	[****]
	 	$[****]






Page 3 of 7









 






CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.





     (c) In order to determine the adjusted prices to be paid during the years [****] and
thereafter for the Cliffs Pellets, the [****] Prices for each of the Cleveland Works and the
Indiana Harbor Works and each of the following respective year’s then-adjusted prices per
iron unit for each of the Cleveland Works and the Indiana Harbor Works shall be further
adjusted, up or down, each year for the year in determination as follows:




	 	(1)  	Divide (x) the numerator, which is the amount by which the [****] (“[****]”)
for the calendar year in determination changes (up or down) from the immediately
preceding calendar year’s [****]; by (y) the denominator, which is the immediately
preceding calendar year’s [****], and multiply the result obtained by [****]; and
	 
	 	(2)  	Divide (x) the numerator, which is the amount by which the [****] (“[****]”)
for the calendar year in determination changes from the immediately preceding calendar
year’s [****]; by (y) the denominator, which is the immediately preceding calendar
year’s [****], and multiply the result obtain by [****]; and
	 
	 	(3)  	Sum the results obtained in paragraphs (1) and (2) above and multiply that
total by [****]; and
	 
	 	(4)  	Multiply the results determined in (3) above by the preceding year’s adjusted
prices per iron unit, which will then equal the current year’s price adjustment per
	 
	 	(5)  	Add the result determined in (4) above to the preceding year’s adjusted price
per iron unit for the Cleveland Works and the Indiana Harbor Works, which will then
equal the current year’s adjusted prices per iron unit for the Cleveland Works and the
Indiana Harbor Works; and
	 
	 	(6)  	Multiply the result determined in (5) above by the current year’s expected
natural iron content, which will then equal the current year’s estimated price per ton
for the Cleveland Works and the Indiana Harbor Works.





     Those adjusted prices per ton shall then become the contract’s year estimated price for the
Cliffs Pellets delivered to the Cleveland Works and the Indiana Harbor Works for the year in
determination.




     (d) The final price for all tons sold by Cliffs to Steel shall be based on actual
natural iron content shipped, as provided in Section 6 of this Agreement.



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CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.





     (e) Attached as Exhibit 5 is an example of the adjustment formula applying the
provisions of Sections 5A(b) and 5A(c).




     (f) (i) Beginning in [****], a Special Payment shall be made in each year, wherein
Cliffs shall pay Steel or Steel shall pay Cliffs, as the case may be, if [****]. The amount
of the Special Payment shall be determined as follows:




	 	(1)  	In any contract year in which [****], Cliffs shall pay Steel an amount equal
to: (w) the amount [****], (x) multiplied by [****], (y) multiplied by [****], (z)
multiplied by the total tons of Cliffs Pellets which Steel [****] in the contract year.
	 
	 	(2)  	In any contract year in which [****], Steel shall pay Cliffs an amount equal
to: (w) the amount [****], (x) multiplied by [****], (y) multiplied by [****], (z)
multiplied by the total tons of Cliffs Pellets which Steel [****] in the contract year.
	 
	 	(3)  	For the purpose of estimating the Special Payment, a steel pricing payment
calculation shall be made by Steel following the end of each quarter, using the formula
provided for in Sections 5A(f)(i)(1) and 5A(f)(i)(2) above for each quarter. This
calculation (and payment, if any) shall be based on [****]. Within 30 days following
each quarter Steel shall notify Cliffs in writing of the amount (if any) payable by
Cliffs to Steel or Steel to Cliffs, and a quarterly payment, if any, shall be made by
Cliffs to Steel or Steel to Cliffs, as the case may be, within 45 days after the end of
each quarter.
	 
	 	(4)  	The final Special Payment calculation shall be made after the end of the year
in accordance with Sections 5A(f)(i)(1) and 5A(f)(i)(2) above which will reflect [****]
adjustment will be made to reflect any difference between the actual year’s Special
Payment and the quarterly estimated payments that were made during the year. Payment
due, from either party, as a result of the actual annual calculation shall be made by
February 15 of the year following the contract year.




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CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.





	 	(5)  	Attached as Exhibits 6 and 7 are examples of the calculations applying the
provisions of Sections 5A(f)(i).






     (ii) In the event that in any year [****] are less than [****], then Cliffs and Steel
agree to review the [****]. If the [****] are greater than or equal to [****] of Steel’s
[****], then the provisions of Section 5A(f)(i) shall apply without further modification. If
such [****] threshold is still not satisfied, then Cliffs and Steel agree to substitute
[****]. The [****] which are used for the price ranges, as provided for in Section 5A(f)(i)
above, shall be adjusted as follows: (i) the [****] (ii) the [****], (iii) with the
difference between (i) and (ii) above being added to both the [****] to determine the
revised ranges for the [****] in order to determine the Special Payment.




     (g) Prices for Cliffs Pellets shall be adjusted on a calendar quarterly basis based
upon estimated and/or actual changes, as applicable, in the published indices specified in
Section 5A(c) (“Quarterly Price Adjustment”). Cliffs shall calculate the Quarterly Price
Adjustment and provide Steel with such Quarterly Price Adjustment by the 15th day after the
end of each calendar quarter, or on such later date as may be mutually agreed between Cliffs
and Steel. Cliffs shall issue an invoice or credit memo, as the case may be, to Steel
concurrently with the Quarterly Price Adjustment, and payment from Cliffs to Steel or Steel
to Cliffs, as the case may be, shall be made by the 15th day following issuance of the
invoice or credit memo, as the case may be.


6. Exhibit 1 is hereby deleted and a new Exhibit 1 is hereby attached to this Agreement and
incorporated in the Agreement by reference.




* * * END OF PAGE * * *




Page 6 of 7









 







IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by their respective
authorized officers.




	 	 	 	 	 	 	 	 	 
	THE CLEVELAND-CLIFFS IRON COMPANY	 	INTERNATIONAL STEEL GROUP INC.	 	 
	By:	 	
/s/ William R. Calfee


Name:  William R. Calfee
Title:  President
	 	By:
	 	/s/ Rodney B. Mott


Name:  Rodney B. Mott
Title:
	 	 
	CLIFFS MINING COMPANY	 	ISG CLEVELAND INC.	 	 
	By:	 	
/s/ William R. Calfee


Name:  William R. Calfee
Title:  Executive Vice President — Commercial
	 	By:
	 	/s/ Rodney B. Mott


Name:  Rodney B. Mott
Title:	 	 
	NORTHSHORE MINING COMPANY	 	ISG INDIANA HARBOR INC.	 	 
	By:	 	
/s/ William R. Calfee


Name:  William R. Calfee
Title:  Executive Vice President — Commercial
	 	By:
	 	/s/ Rodney B. Mott


Name:  Rodney B. Mott
Title:	 	 
	CLIFFS SALES COMPANY	 	 	 	 	 	 
	By:	 	
/s/ William R. Calfee


Name:  William R. Calfee
Title:  Executive Vice President —
Commercial	 	 	 	 	 	 






Page 7 of 7









 






CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.




EXHIBIT 1




CLEVELAND-CLIFFS [****] PELLET TYPICAL ANALYSIS

AS LOADED TO VESSEL FOR SHIPMENT*




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	 	 	Report	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Frequency	 	Typical	 	[***]	 	[***]	 	Typical	 	[***]	 	[***]	 	Typical	 	[***]	 	[***]	 	Typical	 	[***]	 	[***]	 	Typical	 	[***]	 	[***]
	Moisture

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	A. DRY CHEMICAL ANALYSIS
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Iron

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	SiO2

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	Al2O3

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	CaO

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	MgO

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	Mn

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	Phos

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	 
	 	 
	 	[***]
	 	[***]
	 	[***]
	 	[***]	 	 	 	 
	S

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	TiO2

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	Na2O

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	K2O

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	B. SIZING. Wt. %
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	% + 1/2”

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	% - 1/2” x + 3/8”

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	% - 3/8 x + 1/4”

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	% - 1/4”

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	% - 28 mesh
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	C. TUMBLE TEST
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	% + 1/4” before tumble

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	% + 1/4” after tumble

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	 	[***]
	Q Index

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	Tumble Index - 28 mesh

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	D. COMPRESSION TEST
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Minus 1/2” by plus 7/16”
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Minus 1/2” by plus 3/8”

	 	[***]
	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]
	 	 	 	 	 	[***]	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	TYPICAL ANALYSIS

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	S.D.

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	ANALYSIS LIMITS

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LETTER “V” DENOTES

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LETTER “M” DENOTES

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LETTER “SA” DENOTES

	 	 	 	[***]	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






 









 






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FILED SEPARATELY WITH THE SECURITIES AND

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EXHIBIT 5




PRICE ADJUSTMENT FORMULA

[****], [****], [****], [****], AND [****] PELLETS

FOR YEARS 2005 THROUGH 2016




	 	 	 	 	 	 	 
	Current Year’s Price Adjustment Calculation
	 	 	 	 	 	 
	      1. Section 5A(b) and 5A(c)
	 	 	 	 	 	 
	(1)

	 	[****]
	 	X
	 	[****] = A
	

	 	[****]	 	 	 	 
	 
	(2)

	 	[****]
	 	X
	 	[****] = B
	

	 	[****]	 	 	 	 
	 
	(3) (4) ((A + B) X 75.00%) X

	 	Preceding Year’s Adjusted Price Per Iron Unit
	 	=
	 	Current Year’s
Price Adjustment
Per Iron Unit
	 
	Current Year’s Adjusted Price Per Iron Unit
	 	 	 	 	 	 
	 
	(5) Current Year’s Price Adjustment Per Iron Unit

	 	+ Preceding Year’s Adjusted Price Per Iron Unit
	 	=
	 	Current Year’s
Adjusted Price Per
Iron Unit
	 
	Current Year’s Estimated Pellet Price Per Ton
	 	 	 	 	 	 
	 
	(6) Current Year’s Adjusted Price Per Iron Unit

	 	X Current Year’s Expected Natural Iron Content
	 	=
	 	Current Year’s
Estimated Pellet
Price Per Ton






 









 






CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.




EXHIBIT 6




[****] FORMULA

[****], [****], [****], [****], AND [****] PELLETS

FOR THE YEARS 2005 THROUGH 2016




	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Example 1	 	Example 2	 	Example 3	 	Example 4	 	Example 5	 	Example 6
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	First Quarter
	 	 	 	 	 	 	 	 	 	 	 	 
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Second Quarter
	 	 	 	 	 	 	 	 	 	 	 	 
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	 	[****]
	[****]

	 	[****]
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	Third Quarter
	 	 	 	 	 	 	 	 	 	 	 	 
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	Year
	 	 	 	 	 	 	 	 	 	 	 	 
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CONFIDENTIAL MATERIAL HAS BEEN OMITTED AND

FILED SEPARATELY WITH THE SECURITIES AND

EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSIONS.




EXHIBIT 7




SUBSTITUTE [****] EXAMPLE

[****]

FOR YEARS 2005 THROUGH 2016



Contract [****] — [****]



Contract [****] — [****]



In The Event That [****] Annual Total [****] Are Less Than [****], Then Steel And Cliffs Agree To
Substitute Another [****] — Substitute [****]



Determine Substitute [****]



(1) Current Year’s Actual Average [****] of Substituted [****] — Prior Year’s [****] = A



(2) A + [****] = [****]



(3) A + [****] = [****]



Results From (2) and (3) Above Determine Substitute [****]