Document:

EX-10.2

Exhibit 10.2

AMENDMENT NO. 1 TO

ASSET PURCHASE AGREEMENT

THIS AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT, dated as of February 13, 2007 (this
“Amendment”), is made and entered into by and among Enesco Group, Inc., an Illinois
corporation (“Parent”), Gregg Manufacturing, Inc., California corporation (together with
Parent, the “Sellers”), and EGI Acquisition, LLC, a Delaware corporation (the
“Purchaser”). Capitalized terms used, but not otherwise defined, herein shall have the
meanings ascribed to such terms in the Purchase Agreement (as defined below).

WHEREAS, the Sellers and the Purchaser have entered into that certain Asset Purchase
Agreement, dated as of January 21, 2007 (as amended by this Amendment, the “Purchase
Agreement”), which contemplates that the Sellers will, and will cause their respective
Subsidiaries to, sell, assign, transfer, convey and deliver to the Purchaser, and the Purchaser
will purchase from such Persons, all of such Persons’ rights, title and interests in and to, the
Purchased Assets, and the Purchaser will assume and agree to pay, perform and discharge the Assumed
Liabilities, in each case, upon the terms and subject to the conditions set forth in the Purchase
Agreement; and

WHEREAS, the Sellers and the Purchaser desire to amend the Purchase Agreement as set forth
below;

NOW, THEREFORE, in consideration of the mutual agreements contained herein and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

ARTICLE I.

AMENDMENT TO PURCHASE AGREEMENT

Section 1.1 Amendment of Section 1.1. The definition of “Permitted Exceptions” in
Section 1.1 of the Purchase Agreement is hereby amended and restated in its entirety as follows:

“Permitted Exceptions” means: (i) with respect to real property (a) all easements, rights
of way and encumbrances of record disclosed in policies of title insurance that have been disclosed
to Purchaser prior to the date hereof and (b) zoning, entitlement and other land use and
environmental regulations by any Governmental Body, provided that such regulations
have not been violated by existing usage of improvements; provided, however, that
in the case of this clause (i) none of the foregoing, individually or in the aggregate, detract
from the value or current use of the applicable Real Property (hereinafter defined), require the
removal, alteration or loss of any improvement located thereon (including, without limitation,
paved parking areas) or materially interfere with the use of the affected asset or Real Property as
the Business is currently conducted, provided that, if any of the foregoing
encumbrances include mortgages or like encumbrances on the landlord’s interest in any Leased Real
Property, the tenant receives a non-disturbance agreement reasonably satisfactory to it, providing
inter alia, that the mortgagee shall not disturb the tenant’s occupancy or other rights in the
event of foreclosure (unless the tenant is in default past applicable notice and cure periods under
the related Lease); (ii) mechanics’, carriers’, workers’, repairers’ and similar Liens arising or
incurred in the Ordinary Course of Business for sums not yet due and payable; (iii) title of a
lessor under a capital or operating lease; (iv) any other Liens that will be discharged in full
prior to Closing in connection with the Sale Order or any other actions of the Bankruptcy Court;
and (v) the Liens described in Schedule 1.1(d) hereto.”

Section 1.2 Amendment of Section 2.1(q). Section 2.1(q) of the Purchase Agreement is
hereby amended and restated in its entirety as follows:

“any and all residual amounts of or reversionary interests in each of the L/C Collateral (as such
term is defined in the Order approving the DIP Financing Agreement) and the Prepetition Indemnity
Amount (as such term is defined in the Order approving the DIP Financing Agreement), provided
however, that the Purchased Assets shall not include any residual amounts of or reversionary
interests in the Prepetition Indemnity Amount to be released to Sellers that shall constitute part
of the Wind-down Fund (as defined below) in accordance with paragraph 34 of Exhibit A of that
certain Final Order Authorizing Debtors To (A) Incur Postpetition Debt, (B) Grant Liens and Provide
Security and Other Relief to Wells Fargo Foothill, Inc., as Agent, and (C) Grant Adequate
Protection to the Prepetition Agent and Prepetition Lenders, dated February 12, 2007; and”

Section 1.3 Amendment of Section 2.1. Section 2.1 of the Purchase Agreement is hereby
amended by adding the following after Section 2.1(r):

"(s) any and all rights of the Sellers under that certain pay-off letter dated January 23, 2007
issued by Bank of America and LaSalle Bank National Association, including, without limitation, the
right to receive certain lien terminations and releases against certain assets of the Sellers and
certain release documentation related thereto, as more fully described therein.”

Section 1.4 Amendment of Section 2.1(m). Section 2.1(m) of the Purchase Agreement is
hereby amended by adding the words “or Assumed Liabilities” at the end thereof .

Section 1.5 Amendment of Section 2.3. Section 2.3 of the Purchase Agreement is hereby
amended and restated in its entirety as follows:

"Assumption of Liabilities. On the terms and subject to the conditions set forth in this
Agreement, at the Closing, Purchaser shall assume, effective as of the Closing, and shall timely
perform and discharge in accordance with their respective terms, solely the Assumed Liabilities,
subject to all objections, claims, counterclaims, rights of setoff or recoupment, and other
defenses of the Sellers. “Assumed Liabilities” shall mean only the following liabilities (other
than the Excluded Liabilities):

(a) all Liabilities arising under the Assumed Contracts;

(b) solely to the extent provided in Section 9.1, the Liabilities arising out of the Foreign
Benefit Plans; and

(c) each of the following Liabilities solely to the extent such Liabilities constitute current
liabilities:

(i) all accrued payroll obligations of Transferred Employees (including vacation accruals, but
excluding any severance or other obligations arising from the termination of employment of any
employees of the Business, the Sellers or the Foreign Subsidiaries);

(ii) other than Intercompany Payables or the Pre-Petition Liabilities, all accounts payable
incurred in the Ordinary Course of Business after the Petition Date (including, for the avoidance
of doubt, (i) invoiced accounts payable and (ii) accrued but uninvoiced accounts payable); and

(iii) all obligations arising from advances received from customers of the Business;

(d) the Pre-Petition Liabilities set forth on Schedule 2.3(d) of the Sellers
Disclosure Schedule; provided that the Purchaser shall only be obligated to assume and timely
perform and discharge in accordance with their respective terms, such Pre-Petition Liabilities
which, in the aggregate as of a date certain as agreed to by the Sellers and the Purchaser, as
certified by the Sellers as of such date, are not greater than (x) $18,100,000 (the
"Threshold”) plus (y) ten percent (10%) of the Threshold; provided further, to the extent
such Pre-Petition Liabilities, in the aggregate exceed the Threshold plus 10%, Purchaser, in its
sole discretion, may remove certain Pre-Petition Liabilities from Schedule 2.3(d) upon
three days notice to the creditor who is so removed and shall determine those Pre-Petition
Liabilities and corresponding amounts to assume and discharge which, in the aggregate, equal an
amount not greater than the Threshold plus 10%; and

(e) a success fee in an amount no more than 1.5% of the Aggregate Consideration (as defined
below) minus $75,000 payable on behalf of the Sellers to Mesirow Financial Services Inc.”

Section 1.6 Amendment of Section 2.6. Section 2.6 of the Purchase Agreement is hereby
amended and restated in its entirety as follows:

” Purchaser’s Election Right. Notwithstanding anything to the contrary in this Agreement,
Purchaser shall have the right, without any further adjustment to the Purchase Price, to add any
Contract that is an executory contract or unexpired lease to Schedule 2.6, thereby making
such Contract an Assumed Contract, by written notice delivered to Sellers at any time during the
period from and after the date hereof until the later (A) of the Closing Date and (B) the fifth
Business Day after receiving notice from any Seller that such Seller intends to reject such
Contract.”

Section 1.7 Amendment of Section 3.1. Section 3.1 of the Purchase Agreement is hereby
amended and restated in its entirety as follows:

“The aggregate consideration for the Purchased Assets (the “Aggregate Consideration”)
shall be (a) an amount in cash equal to the principal amount plus interest, fees and any other
expenses of the DIP Note outstanding as of the Closing Date (the “Purchase Price”), (b) the
assumption of the Assumed Liabilities, (c) forgiveness of any and all Pre-Petition Liabilities of
the Sellers owed to Affiliates of the Purchaser, including without limitation a certain deposit in
the amount of $100,000 funded by an Affiliate of the Purchaser for the benefit of Parent prior to
the date hereof and (d) $700,000.00 in respect of administration expenses incurred by Sellers in
the Bankruptcy Case, as adjusted by Section 2.1(q) (the “Wind-down Fund”). To the extent
the Purchase Price shall exceed the aggregate of (i) the amount set forth in the Payoff Letters and
(ii) the Wind-down Fund, such excess shall be returned to Purchaser. On the Closing Date, Parent
shall deliver to Purchaser a certificate from an authorized executive officer of each of Parent and
the DIP Lender which states the principal amount plus interest, fees and any other expenses of the
DIP Note outstanding as of the Closing Date. Purchaser shall have the right to rely
unconditionally and conclusively on such certificate in determining the Purchase Price and shall be
obligated to fund only such amount. To the extent that it is determined that the Purchase Price
paid is greater than amounts owed or owing under the DIP Amount, the excess, if any, shall
immediately be returned to the Purchaser. Notwithstanding anything to the contrary in this Section
3.1, if and to the extent Purchaser or any of its Affiliates shall become a DIP Lender or otherwise
assume the rights of a DIP Lender under the DIP Note, in lieu of paying cash in satisfaction of the
Purchase Price, Purchaser or its Affiliates, as applicable, shall be entitled to cancel all or any
portion of the DIP Note held by Purchaser or such Affiliates, and together with the other
components of Aggregate Consideration set forth in this Section 3.1 of the Purchase Agreement such
cancellation shall constitute the Purchase Price, for purposes of Section 3.1(a).”

Section 1.8 Amendment of Section 3.2. Section 3.2 of the Purchase Agreement is hereby
amended and restated in its entirety as follows:

“On the terms and subject to the conditions set forth herein, at the Closing, in consideration for
the sale of the Purchased Assets, Purchaser shall (i) pay, on behalf of Sellers and in full
satisfaction of their obligations under the DIP Note, the Purchase Price to the DIP Lender;
provided that in lieu of paying cash in satisfaction of the Purchase Price, Purchaser or its
Affiliates, as applicable, shall be entitled to cancel all or any portion of the DIP Note held by
Purchaser or such Affiliates and (ii) assume the Assumed Liabilities. The Purchase Price payable at
Closing, if at all, shall be paid by Purchaser to the DIP Lender by wire transfer of immediately
available funds into an account designated by the DIP Lender at least two Business Days prior to
the Closing Date.”

Section 1.9 Amendment of Section 4.1. Section 4.1 of the Purchase Agreement is
hereby amended and restated in its entirety as follows:

“The closing of the purchase and sale of the Purchased Assets and the assumption of the Assumed
Liabilities provided for in Article II hereof (collectively, the “Closing”) shall
take place at the offices of Schulte Roth & Zabel LLP located at 919 Third Avenue, New York, New
York (or at such other place as the Parties may designate in writing) at 10:00 a.m. (New York City
time) on the date that the Sale Order is entered on the docket of the Bankruptcy Court or such
other date agreed to by Purchaser, in its sole discretion; provided that such date agreed to by
Purchaser in its sole discretion does not in and of itself give rise to Purchaser’s right to
terminate this Agreement in accordance with Section 4.4. The date on which the Closing shall be
held is referred to in this Agreement as the “Closing Date.” The Closing shall be deemed
to have occurred at 11:59:59 p.m. (New York City time) on the Closing Date.”

Section 1.10 Amendment of Section 7.2. Section 7.2 of the Purchase Agreement is hereby
amended by replacing the reference to “February 13, 2007” therein with “February 15, 2007.”

Section 1.11 Amendment of Section 10.1. Section 10.1 of the Purchase Agreement is hereby
amended by adding the following after Section 10.1(g):

"(h) the Bankruptcy Court shall have entered the Sale Order no later than February 15, 2007 in form
and substance reasonably acceptable to Purchaser, and the Sale Order shall have become a Final
Order.”

Section 1.12 Amendment of Section 10.3(b). Section 10.3(b) of the Purchase Agreement
is hereby amended and restated in its entirety as follows:

” (b) the Bankruptcy Court shall have entered the Sale Order no later than February 15;”

ARTICLE II.

AMENDMENT OF DISCLOSURE SCHEDULE

Section 2.1 Amendment of Schedules. The Sellers Disclosure Schedule is hereby amended
and restated in its entirety as set forth on Exhibit A attached hereto, and each such
amended Schedule of the Sellers Disclosure Schedule shall be deemed for all purposes to have been
delivered as of the date of the Purchase Agreement.

ARTICLE III.

ASSIGNMENT; POST-CLOSING ACCESS

Section 3.1 Assignment. Pursuant to Section 12.8 of the Purchase Agreement, Purchaser
may assign any or all of its rights and obligations under the Purchase Agreement, without the
consent of any Parties thereto, to any one or more of its Affiliates. Prior to Closing, Purchaser
will provide the Sellers with a schedule (the “Purchase Breakdown Schedule”) that specifies
(a) the names of the Affiliates to whom Purchaser intends to assign a portion of its rights and
corresponding obligations, (b) which of the Purchased Assets the Purchaser and each such Affiliate
will acquire and (c) the portion of the Aggregate Consideration the Purchaser and each such
Affiliate will pay. The Purchaser and the Affiliates listed on the Purchase Breakdown Schedule
will pay the Aggregate Consideration and will acquire all the Purchased Assets. The Sellers hereby
agree and acknowledge their obligation to transfer the Purchased Assets to Purchaser and such
Affiliates of Purchaser as identified on such Schedule and to accept as payment the portion of the
Aggregate Consideration set forth opposite such Purchased Asset’s identity, on such Schedule.

Section 3.2 Post-Closing Access to Records. Purchaser agrees that the Sellers, the
unsecured creditors committee, or their authorized representatives (or any subsequently appointed
trustee) (collectively, the “Estate”), shall be expressly granted access to the Sellers’
books, records and former key employees to the extent still employed by the Purchaser following the
Closing, at no charge to the Estate, in order to conduct any investigation of claims or liens, or
winddown activities necessary, at such reasonable times during normal business hours and upon
prior, reasonable notification so as not to disrupt, in Purchaser’s sole discretion, Purchaser’s
operation of the business.

ARTICLE IV.

MISCELLANEOUS

Section 4.1 No Waiver. Nothing in this Amendment shall constitute a waiver by the
Sellers or the Purchaser of any breach or default on the part of any party to the Purchase
Agreement.

Section 4.2 Governing Law; Jurisdiction. This Amendment shall be governed by and
construed in accordance with the Bankruptcy Code and to the extent not consistent with the
Bankruptcy Code, the internal laws of the State of New York applicable to contracts made and
performed in such State (without regard to principles of conflicts of laws).

Section 4.3 Entire Agreement. This Amendment together with the Purchase Agreement
(together with the Schedules, Exhibits and other agreements referenced therein), constitute the
entire agreement of the parties hereto with respect to the subject matter hereof and thereof and
supersede all prior agreements and undertakings, both written and oral, among the Sellers and the
Purchaser with respect to the subject matter hereof and thereof.

Section 4.4 Effect. Except as expressly set forth herein, this Amendment shall not by
implication or otherwise alter, modify, amend or in any way affect any of the representations,
warranties, terms, conditions, obligations, covenants or agreements contained in the Purchase
Agreement, all of which shall continue in full force and effect in accordance with their respective
terms. For the avoidance of doubt, except as expressly set forth herein, the execution, delivery
and effectiveness of this Amendment shall not constitute a reaffirmation, remaking, withdrawal or
modification as of the date of this Amendment of any of the representations, warranties or
covenants of any party hereto.

Section 4.5 Counterparts. This Amendment may be executed and delivered (including by
facsimile transmission) in one or more counterparts, and by the different parties hereto in
separate counterparts, each of which when executed shall be deemed to be an original, but all of
which taken together shall constitute one and the same agreement.

[remainder of page intentionally left blank; signature page follows]

1

IN WITNESS WHEREOF, the parties hereto caused this Amendment No. 1 to Asset Purchase
Agreement to be duly executed as of the date first above written.

PURCHASER

EGI ACQUISITION, LLC

By: /s/ Seth M. Hendon

Name: Seth M. Hendon

Title: Vice President

SELLERS:

ENESCO GROUP, INC.

By: /s/ Marie Meisenbach Graul

Name: Marie Meisenbach Graul

Title: Executive Vice President and

Chief Financial Officer

GREGG MANUFACTURING, INC.

By: /s/ Charles Eugene Sanders

Name: Charles Eugene Sanders

Title: Secretary and Treasurer

2EX-10.(a)

SEVERANCE AGREEMENT

THIS SEVERANCE AGREEMENT (this “Agreement”), dated as of this 8th day of January,
2007 is made and entered by and between Cleveland-Cliffs Inc, an Ohio corporation (the
“Company”), and Laurie Brlas (the “Executive”).

WITNESSETH:

WHEREAS, the Executive is an elected officer who is a full-time employee of the Company or one
or more of its Subsidiaries who is a Senior Vice President, Vice President, Controller or Secretary
and who is expected to make major contributions to the short- and long-term profitability, growth
and financial strength of the Company;

WHEREAS, the Company recognizes that, as is the case for most publicly held companies, the
possibility of a Change in Control (as defined below) exists;

WHEREAS, the Company desires to assure itself of both present and future continuity of
management and desires to establish certain minimum severance benefits for certain of its senior
executives, including the Executive, applicable in the event of a Change in Control;

WHEREAS, the Company wishes to ensure that its senior executives are not practically disabled
from discharging their duties in respect of a proposed or actual transaction involving a Change in
Control; and

WHEREAS, the Company desires to provide additional inducement for the Executive to continue to
remain in the employ of the Company.

NOW, THEREFORE, the Company and the Executive agree as follows:

	1.	 	Certain Defined Terms. In addition to terms defined elsewhere herein, the following
terms have the following meanings when used in this Agreement with initial capital letters:

	 	(a)	 	“Base Pay” means the Executive’s annual base salary rate as in effect from
time to time.

	 	(b)	 	“Board” means the Board of Directors of the Company.

	 	(c)	 	“Cause” means that, prior to any termination pursuant to Section 3(b), the
Executive shall have committed:

	 	(i)	 	and been convicted of a criminal violation involving fraud,
embezzlement or theft in connection with his duties or in the course of his
employment with the Company or any Subsidiary;

	 	(ii)	 	intentional wrongful damage to property of the Company or any
Subsidiary;

	 	(iii)	 	intentional wrongful disclosure of secret processes or
confidential information of the Company or any Subsidiary; or

	 	(iv)	 	intentional wrongful engagement in any Competitive Activity;

and any such act shall have been demonstrably and materially harmful to the Company. For
purposes of this Agreement, no act or failure to act on the part of the Executive shall be
deemed “intentional” if it was due primarily to an error in judgment or negligence, but
shall be deemed “intentional” only if done or omitted to be done by the Executive not in
good faith and without reasonable belief that the Executive’s action or omission was in the
best interest of the Company. Notwithstanding the foregoing, the Executive shall not be
deemed to have been terminated for “Cause” hereunder unless and until there shall have been
delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of
not less than three quarters of the Board then in office at a meeting of the Board called
and held for such purpose, after reasonable notice to the Executive and an opportunity for
the Executive, together with the Executive’s counsel (if the Executive chooses to have
counsel present at such meeting), to be heard before the Board, finding that, in the good
faith opinion of the Board, the Executive had committed an act constituting “Cause” as
herein defined and specifying the particulars thereof in detail. Nothing herein will limit
the right of the Executive or his beneficiaries to contest the validity or propriety of any
such determination.

	 	(d)	 	“Change in Control” means the occurrence during the Term of any of the
following events:

	 	(i)	 	The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 30% or more of the combined voting power of the then
outstanding Voting Stock of the Company; provided, however, that for purposes
of this Section 1(d)(i), the following acquisitions shall not constitute a
Change in Control: (A) any issuance of Voting Stock of the Company directly
from the Company that is approved by the Incumbent Board (as defined in Section
1(d)(ii), below), (B) any acquisition by the Company of Voting Stock of the
Company, (C) any acquisition of Voting Stock of the Company by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
Subsidiary, or (D) any acquisition of Voting Stock of the Company by any Person
pursuant to a Business Combination that complies with clauses (A), (B) and (C)
of Section 1(d)(iii), below; or

	 	(ii)	 	individuals who, as of the date hereof, constitute the Board
(the “Incumbent Board”) cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a Director
subsequent to the date hereof whose election, or nomination for election by the
Company’s shareholders, was approved by a vote of at least a majority of the
Directors then comprising the Incumbent Board (either by a specific vote or by
approval of the proxy statement of the Company in which such person is named as
a nominee for director, without objection to such nomination) shall be deemed
to have been a member of the Incumbent Board, but excluding, for this purpose,
any such individual whose initial assumption of office occurs as a result of an
actual or threatened election contest (within the meaning of Rule 14a-11 of the
Exchange Act) with respect to the election or removal of Directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board; or

	 	(iii)	 	consummation of a reorganization, merger or consolidation
involving the Company, a sale or other disposition of all or substantially all
of the assets of the Company, or any other transaction involving the Company
(each, a “Business Combination”), unless, in each case, immediately following
such Business Combination, (A) all or substantially all of the individuals and
entities who were the beneficial owners of Voting Stock of the Company
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 55% of the combined voting power of the then outstanding
 shares of Voting Stock of the entity resulting from such Business Combination
(including, without limitation, an entity which as a result of such transaction
owns the Company or all or substantially all of the Company’s assets either
directly or through one or more subsidiaries) in substantially the same
proportions relative to each other as their ownership, immediately prior to
such Business Combination, of the Voting Stock of the Company, (B) no Person
(other than the Company, such entity resulting from such Business Combination,
or any employee benefit plan (or related trust) sponsored or maintained by the
Company, any Subsidiary or such entity resulting from such Business
Combination) beneficially owns, directly or indirectly, 30% or more of the
combined voting power of the then outstanding shares of Voting Stock of the
entity resulting from such Business Combination, and (C) at least a majority of
the members of the Board of Directors of the entity resulting from such
Business Combination were members of the Incumbent Board at the time of the
execution of the initial agreement or of the action of the Board providing for
such Business Combination; or

	 	(iv)	 	approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company, except pursuant to a Business
Combination that complies with clauses (A), (B) and (C) of Section 1(d)(iii).

	 	(e)	 	“Competitive Activity” means the Executive’s participation, without the written
consent of an officer of the Company, in the management of any business enterprise if
such enterprise engages in substantial and direct competition with the Company and such
enterprise’s sales of any product or service competitive with any product or service of
the Company amounted to 10% of such enterprise’s net sales for its most recently
completed fiscal year and if the Company’s net sales of said product or service
amounted to 10% of the Company’s net sales for its most recently completed fiscal year.
“Competitive Activity” will not include (i) the mere ownership of securities in any
such enterprise and the exercise of rights appurtenant thereto or (ii) participation in
the management of any such enterprise other than in connection with the competitive
operations of such enterprise.

	 	(f)	 	“Employee Benefits” means the perquisites, benefits and service credit for
benefits as provided under any and all employee retirement income and welfare benefit
policies, plans, programs or arrangements in which Executive is entitled to
participate, including without limitation any stock option, performance share,
performance unit, stock purchase, stock appreciation, savings, pension, supplemental
executive retirement, or other retirement income or welfare benefit, deferred
compensation, incentive compensation, group or other life, health, medical/hospital or
other insurance (whether funded by actual insurance or self-insured by the Company or a
Subsidiary), disability, salary continuation, expense reimbursement and other employee
benefit policies, plans, programs or arrangements that may now exist or any equivalent
successor policies, plans, programs or arrangements that may be adopted hereafter by
the Company or a Subsidiary, providing perquisites, benefits and service credit for
benefits at least as great in value in the aggregate as are payable thereunder prior to
a Change in Control.

	 	(g)	 	“Exchange Act” means the Securities Exchange Act of 1934, as amended.

	 	(h)	 	“Incentive Pay” means an annual bonus, incentive or other payment of
compensation, in addition to Base Pay, made or to be made in regard to services
rendered in any year or other period pursuant to any bonus, incentive, profit-sharing,
performance, discretionary pay or similar agreement, policy, plan, program or
arrangement (whether or not funded) of the Company or a Subsidiary, or any successor
thereto.

	 	(i)	 	“Industry Service” means professionally related service, prior to his
employment by the Company or a Subsidiary, by the Executive as an employee within the
iron, steel and mining industries or service within an industry to which such
Executive’s position with the Company relates. The Executive shall be given credit for
one year of Industry Service for every two years of service with the Company, as
designated in writing by, or in minutes of the actions of, the Compensation and
Organization Committee of the Board, and such years of credited Industry Service shall
be defined as “Credited Years of Industry Service.”

	 	(j)	 	“Retirement Plans” means the retirement income, supplemental executive
retirement, excess benefits and retiree medical, life and similar benefit plans
providing retirement perquisites, benefits and service credit for benefits at least as
great in value in the aggregate as are payable thereunder prior to a Change in Control.

	 	(k)	 	“Severance Compensation” means the severance pay and other benefits provided by
Sections 4(a) and (b).

	 	(l)	 	“Severance Period” means the period of time commencing on the date of the first
occurrence of a Change in Control and continuing until the earlier of (i) the second
anniversary of the occurrence of the Change in Control, or (ii) the Executive’s death.

	 	(m)	 	“Subsidiary” means an entity in which the Company directly or indirectly
beneficially owns 50% or more of the outstanding capital or profits interests or Voting
Stock.

	 	(n)	 	“Supplemental Retirement Plan” or “SRP” means the Cleveland-Cliffs Inc
Supplemental Retirement Benefit Plan (as Amended and Restated as of January 1, 2001),
as it may be amended prior to a Change in Control, and modified as provided in Annex A,
Paragraph (3).

	 	(o)	 	“Term” means the two(2)-year period commencing on the Executive’s Termination
Date.

	 	(p)	 	“Termination Date” means the date on which the Executive’s employment is
terminated pursuant to Section 3 (the effective date of which shall be the date of
termination, or such other date that may be specified by the Executive if the
termination is pursuant to Section 3(b)).

	 	(q)	 	“Voting Stock” means securities entitled to vote generally in the election of
directors.

	2.	 	Operation of Agreement. This Agreement will be effective and binding immediately
upon its execution, but, anything in this Agreement to the contrary notwithstanding, this
Agreement will not be operative unless and until a Change in Control occurs. Upon the
occurrence of a Change in Control at any time during the Term, without further action, this
Agreement shall become immediately operative, including without limitation, the last sentence
of Section 11 notwithstanding that the Term may have theretofore expired.

	 	3.	 	Termination Following a Change in Control.(a) (a) In the event of the
occurrence of a Change in Control, the Executive’s employment may be terminated by the
Company or a Subsidiary during the Severance Period and the Executive shall be entitled
to the benefits provided by Section 4 unless such termination is the result of the
occurrence of one or more of the following events:

	 	(i)	 	The Executive’s death;

	 	(ii)	 	If the Executive becomes permanently disabled within the
meaning of, and begins actually to receive disability benefits pursuant to, the
long-term disability plan in effect for, or applicable to, the Executive
immediately prior to the Change in Control; or

	 	(iii)	 	Cause.

If, during the Severance Period, the Executive’s employment is terminated by the Company or any
Subsidiary other than pursuant to Section 3(a)(i), 3(a)(ii) or 3(a)(iii), the Executive will be
entitled to the benefits provided by Section 4 hereof.

	 	(b)	 	In the event of the occurrence of a Change in Control, the Executive may
terminate employment with the Company and any Subsidiary during the Severance Period
with the right to Severance Compensation as provided in Section 4 upon the occurrence
of one or more of the following events (regardless of whether any other reason, other
than Cause as hereinabove provided, for such termination exists or has occurred,
including without limitation other employment):

	 	(i)	 	(A) A significant adverse change in the nature or scope of the
authorities, powers, functions, responsibilities or duties attached to the
position with the Company and any Subsidiary which the Executive held
immediately prior to the Change in Control, (B) a reduction in the Executive’s
Base Pay, (C) a reduction in the Executive’s opportunity to receive Incentive
Pay from the Company and any Subsidiary, or (D) the termination or denial of
the Executive’s rights to Employee Benefits or a reduction in the scope or
value thereof, any of which is not remedied by the Company within 10 calendar
days after receipt by the Company of written notice from the Executive of such
change, reduction or termination, as the case may be;

	 	(ii)	 	The liquidation, dissolution, merger, consolidation or
reorganization of the Company or transfer of all or substantially all of its
business and/or assets, unless the successor or successors (by liquidation,
merger, consolidation, reorganization, transfer or otherwise) to which all or
substantially all of its business and/or assets have been transferred (by
operation of law or otherwise) assumed all duties and obligations of the
Company under this Agreement pursuant to Section 11(a);

	 	(iii)	 	The Company relocates its principal executive offices (if such
offices are the principal location of Executive’s work), or requires the
Executive to have his principal location of work changed, to any location that,
in either case, is in excess of 25 miles from the location thereof immediately
prior to the Change in Control, without his prior written consent; or

	 	(iv)	 	Without limiting the generality or effect of the foregoing, any
material breach of this Agreement by the Company or any successor thereto which
is not remedied by the Company within 10 calendar days after receipt by the
Company of written notice from the Executive of such breach.

	 	(c)	 	A termination by the Company pursuant to Section 3(a) or by the Executive
pursuant to Section 3(b) will not affect any rights that the Executive may have
pursuant to any agreement, policy, plan, program or arrangement of the Company or
Subsidiary providing Employee Benefits, which rights shall be governed by the terms
thereof, except for any rights to severance compensation to which the Executive may be
entitled upon termination of employment under any severance pay policy, plan, program
or arrangement of the Company, which rights shall, during the Severance Period, be
superseded by this Agreement.

	 	4.	 	Severance Compensation.(a) (a) If, following the occurrence of a
Change in Control, the Company or Subsidiary terminates the Executive’s employment
during the Severance Period other than pursuant to Section 3(a)(i), 3(a)(ii) or
3(a)(iii), or if the Executive terminates his employment pursuant to Section 3(b), the
Company will pay to the Executive the amounts described in Annex A within ten (10)
business days after the Termination Date, or, if later, upon the expiration of the
revocation period provided for in Exhibit A, and will continue to provide to the
Executive the benefits described on Annex A for the periods described therein.

	 	(b)	 	Without limiting the rights of the Executive at law or in equity, if the
Company fails to make any payment or provide any benefit required to be made or
provided hereunder on a timely basis, the Company will pay interest on the amount or
value thereof at an annualized rate of interest equal to the so-called composite “prime
rate” as quoted from time to time during the relevant period in the Midwest Edition of
The Wall Street Journal, plus 2%. Such interest will be payable as it accrues
on demand. Any change in such prime rate will be effective on and as of the date of
such change.

	 	(c)	 	Notwithstanding any provision of this Agreement to the contrary, the parties’
respective rights and obligations under this Section 4 and under Sections 5, 7, 8 and
the last sentence of Section 9 and Paragraph (3) of Annex A will survive any
termination or expiration of this Agreement or the termination of the Executive’s
employment following a Change in Control for any reason whatsoever.

	 	(d)	 	Unless otherwise expressly provided by the applicable policy, plan, program or
agreement, after the occurrence of a Change in Control, the Company shall pay in cash
to the Executive a lump sum amount equal to the value of any annual bonus or long-term
incentive pay (including, without limitation, incentive-based annual cash bonuses and
performance units, but not including any equity-based compensation or compensation
provided under a qualified plan) earned or granted with respect to the Executive’s
service during the performance period or periods that includes the date on which the
Change in Control occurred, disregarding any applicable vesting requirements; provided
that such amount shall be calculated at the plan target rate, but prorated on the
portion of the Executive’s service that had elapsed during the applicable performance
period. Such payment shall take into account service rendered through the payment date
and shall be made at the earlier of (i) the date prescribed for payment pursuant to the
applicable plan, program or agreement, and (ii) within five business days after the
Termination Date.

	 	(e)	 	Notwithstanding any provision to the contrary in any applicable policy, plan,
program or agreement, upon the occurrence of a Change in Control, all equity incentive
grants and awards held by the Executive shall become fully vested and all stock options
held by the Executive shall become fully exercisable.

	 	5.	 	Certain Additional Payments by the Company.(a) (a) Anything in this
Agreement to the contrary notwithstanding, in the event that this Agreement shall
become operative and it shall be determined (as hereafter provided) that any payment
(other than the Gross-Up payments provided for in this Section 5) or distribution by
the Company or any of its affiliates to or for the benefit of the Executive, whether
paid or payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise pursuant to or by reason of any other agreement, policy, plan, program or
arrangement, including without limitation any stock option, performance share,
performance unit, stock appreciation right or similar right, or the lapse or
termination of any restriction on or the vesting or exercisability of any of the
foregoing (a “Payment”), would be subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the “Code”) (or any successor provision
thereto) by reason of being considered “contingent on a change in ownership or control”
of the Company, within the meaning of Section 280G of the Code (or any successor
provision thereto) or to any similar tax imposed by state or local law, or any interest
or penalties with respect to such tax (such tax or taxes, together with any such
interest and penalties, being hereafter collectively referred to as the “Excise Tax”),
then the Executive shall be entitled to receive an additional payment or payments
(collectively, a “Gross-Up Payment”); provided, however, that no Gross-up Payment shall
be made with respect to the Excise Tax, if any, attributable to (i) any incentive stock
option, as defined by Section 422 of the Code (“ISO”) granted prior to the execution of
this Agreement, or (ii) any stock appreciation or similar right, whether or not
limited, granted in tandem with any ISO described in clause (i). The Gross-Up Payment
shall be in an amount such that, after payment by the Executive of all taxes (including
any interest or penalties imposed with respect to such taxes), including any Excise Tax
imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payment.

	 	(b)	 	Subject to the provisions of Section 5(f), all determinations required to be
made under this Section 5, including whether an Excise Tax is payable by the Executive
and the amount of such Excise Tax and whether a Gross-Up Payment is required to be paid
by the Company to the Executive and the amount of such Gross-Up Payment, if any, shall
be made by a nationally recognized accounting firm (the “Accounting Firm”) selected by
the Executive in his sole discretion. The Executive shall direct the Accounting Firm
to submit its determination and detailed supporting calculations to both the Company
and the Executive within 30 calendar days after the Termination Date, if applicable,
and any such other time or times as may be requested by the Company or the Executive.
If the Accounting Firm determines that any Excise Tax is payable by the Executive, the
Company shall pay the required Gross-Up Payment to the Executive within five business
days after receipt of such determination and calculations with respect to any Payment
to the Executive. If the Accounting Firm determines that no Excise Tax is payable by
the Executive, it shall, at the same time as it makes such determination, furnish the
Company and the Executive an opinion that the Executive has substantial authority not
to report any Excise Tax on his federal, state or local income or other tax return. As
a result of the uncertainty in the application of Section 4999 of the Code (or any
successor provision thereto) and the possibility of similar uncertainty regarding
applicable state or local tax law at the time of any determination by the Accounting
Firm hereunder, it is possible that Gross-Up Payments which will not have been made by
the Company should have been made (an “Underpayment”), consistent with the calculations
required to be made hereunder. In the event that the Company exhausts or fails to
pursue its remedies pursuant to Section 5(f) and the Executive thereafter is required
to make a payment of any Excise Tax, the Executive shall direct the Accounting Firm to
determine the amount of the Underpayment that has occurred and to submit its
determination and detailed supporting calculations to both the Company and the
Executive as promptly as possible. Any such Underpayment shall be promptly paid by the
Company to, or for the benefit of, the Executive within five business days after
receipt of such determination and calculations.

	 	(c)	 	The Company and the Executive shall each provide the Accounting Firm access to
and copies of any books, records and documents in the possession of the Company or the
Executive, as the case may be, reasonably requested by the Accounting Firm, and
otherwise cooperate with the Accounting Firm in connection with the preparation and
issuance of the determinations and calculations contemplated by Section 5(b). Any
determination by the Accounting Firm as to the amount of the Gross-Up Payment shall be
binding upon the Company and the Executive.

	 	(d)	 	The federal, state and local income or other tax returns filed by the Executive
shall be prepared and filed on a consistent basis with the determination of the
Accounting Firm with respect to the Excise Tax payable by the Executive. The Executive
shall make proper payment of the amount of any Excise Payment, and at the request of
the Company, provide to the Company true and correct copies (with any amendments) of
his federal income tax return as filed with the Internal Revenue Service and
corresponding state and local tax returns, if relevant, as filed with the applicable
taxing authority, and such other documents reasonably requested by the Company,
evidencing such payment. If prior to the filing of the Executive’s federal income tax
return, or corresponding state or local tax return, if relevant, the Accounting Firm
determines that the amount of the Gross-Up Payment should be reduced, the Executive
shall within five business days pay to the Company the amount of such reduction.

	 	(e)	 	The fees and expenses of the Accounting Firm for its services in connection
with the determinations and calculations contemplated by Section 5(b) shall be borne by
the Company. If such fees and expenses are initially paid by the Executive, the
Company shall reimburse the Executive the full amount of such fees and expenses within
five business days after receipt from the Executive of a statement therefor and
reasonable evidence of his payment thereof.

	 	(f)	 	The Executive shall notify the Company in writing of any claim by the Internal
Revenue Service or any other taxing authority that, if successful, would require the
payment by the Company of a Gross-Up Payment. Such notification shall be given as
promptly as practicable but no later than 10 business days after the Executive actually
receives notice of such claim and the Executive shall further apprise the Company of
the nature of such claim and the date on which such claim is requested to be paid (in
each case, to the extent known by the Executive). The Executive shall not pay such
claim prior to the earlier of (i) the expiration of the 30-calendar-day period
following the date on which he gives such notice to the Company and (ii) the date that
any payment of amount with respect to such claim is due. If the Company notifies the
Executive in writing prior to the expiration of such period that it desires to contest
such claim, the Executive shall:

	 	(i)	 	provide the Company with any written records or documents in
his possession relating to such claim reasonably requested by the Company;

	 	(ii)	 	take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including
without limitation accepting legal representation with respect to such claim by
an attorney competent in respect of the subject matter and reasonably selected
by the Company;

	 	(iii)	 	cooperate with the Company in good faith in order effectively
to contest such claim; and

	 	(iv)	 	permit the Company to participate in any proceedings relating
to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including interest and penalties) incurred in connection with such contest and shall
indemnify and hold harmless the Executive, on an after-tax basis, for and against any Excise Tax or
income tax, including interest and penalties with respect thereto, imposed as a result of such
representation and payment of costs and expenses. Without limiting the foregoing provisions of
this Section 5(f), the Company shall control all proceedings taken in connection with the contest
of any claim contemplated by this Section 5(f) and, at its sole option, may pursue or forego any
and all administrative appeals, proceedings, hearings and conferences with the taxing authority in
respect of such claim (provided, however, that the Executive may participate therein at his own
cost and expense) and may, at its option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall determine; provided,
however, that if the Company directs the Executive to pay the tax claimed and sue for a
refund, the Company shall advance the amount of such payment to the Executive on an interest-free
basis and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise
Tax or income or other tax, including interest or penalties with respect thereto, imposed with
respect to such advance; and provided further, however, that any extension
of the statute of limitations relating to payment of taxes for the taxable year of the Executive
with respect to which the contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Company’s control of any such contested claim shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

	 	(g)	 	If, after the receipt by the Executive of an amount advanced by the Company
pursuant to Section 5(f), the Executive receives any refund with respect to such claim,
the Executive shall (subject to the Company’s complying with the requirements of
Section 5(f)) promptly pay to the Company the amount of such refund (together with any
interest paid or credited thereon after any taxes applicable thereto). If, after the
receipt by the Executive of an amount advanced by the Company pursuant to Section 5(f),
a determination is made that the Executive shall not be entitled to any refund with
respect to such claim and the Company does not notify the Executive in writing of its
intent to contest such denial or refund prior to the expiration of 30 calendar days
after such determination, then such advance shall be forgiven and shall not be required
to be repaid and the amount of any such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid by the Company to the Executive
pursuant to this Section 5.

	6.	 	No Mitigation Obligation. The Company hereby acknowledges that it will be difficult
and may be impossible for the Executive to find reasonably comparable employment following the
Termination Date and that the non-competition covenant contained in Section 8 will further
limit the employment opportunities for the Executive. In addition, the Company acknowledges
that its severance pay plans applicable in general to its salaried employees do not provide
for mitigation, offset or reduction of any severance payment received thereunder.
Accordingly, the payment of the Severance Compensation by the Company to the Executive in
accordance with the terms of this Agreement is hereby acknowledged by the Company to be
reasonable, and the Executive will not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise, nor will any profits,
income, earnings or other benefits from any source whatsoever create any mitigation, offset,
reduction or any other obligation on the part of the Executive hereunder or otherwise, except
as expressly provided in the last sentence of Paragraph (2) set forth on Annex A.

	7.	 	Certain Payments not Considered for Other Benefits, etc. The Gross-up Payment, legal
fee and expense reimbursement provided under Section 8 and reimbursements for outplacement
counseling provided under Paragraph 6 of Annex A will not be included as earnings for the
purpose of calculating contributions or benefits under any employee benefit plan of the
Company. Such payments and payments of severance pay will not be made from any benefit plan
funds, and shall constitute an unfunded unsecured obligation of the Company.

8. Legal Fees and Expenses.(a) (a) It is the intent of the Company that the
Executive not be required to incur legal fees and the related expenses associated with the
interpretation, enforcement or defense of Executive’s rights under this Agreement by
litigation or otherwise because the cost and expense thereof would substantially detract
from the benefits intended to be extended to the Executive hereunder. Accordingly, if it
should appear to the Executive that the Company has failed to comply with any of its
obligations under this Agreement or in the event that the Company or any other person takes
or threatens to take any action to declare this Agreement void or unenforceable, or
institutes any litigation or other action or proceeding designed to deny, or to recover
from, the Executive the benefits provided or intended to be provided to the Executive
hereunder, the Company irrevocably authorizes the Executive from time to time to retain
counsel of Executive’s choice, at the expense of the Company as hereafter provided, to
advise and represent the Executive in connection with any such interpretation, enforcement
or defense, including without limitation the initiation or defense of any litigation or
other legal action, whether by or against the Company or any Director, officer, stockholder
or other person affiliated with the Company, in any jurisdiction. Notwithstanding any
existing or prior attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Executive’s entering into an attorney-client
relationship with such counsel, and in that connection the Company and the Executive agree
that a confidential relationship shall exist between the Executive and such counsel.
Without respect to whether the Executive prevails, in whole or in part, in connection with
any of the foregoing, the Company will pay and be solely financially responsible for any and
all attorneys’ and related fees and expenses incurred by the Executive in connection with
any of the foregoing; provided that, in regard to such matters, the Executive has not acted
in bad faith or with no colorable claim of success.

	 	(b)	 	To ensure that the provisions of this Agreement can be enforced by the
Executive, certain trust arrangements (“Trusts”) have been established between KeyTrust
Company of Ohio, N.A., as Trustee (“Trustee”), and the Company. Each of Trust
Agreement No. 1 (Amended and Restated Effective June 1, 1997, as amended) (“Trust
Agreement No. 1”), Trust Agreement No. 2 (Amended and Restated Effective October 15,
2002, as amended) (“Trust Agreement No. 2”), and Trust Agreement No. 7 dated April 9,
1991, as amended (“Trust Agreement No. 7”), as it may be subsequently amended and/or
restated, between the Trustee and the Company, sets forth the terms and conditions
relating to payment from Trust Agreement No. 1 of compensation, pension benefits and
other benefits pursuant to the Agreement owed by the Company, payment from Trust
Agreement No. 2 for attorneys’ fees and related fees and expenses pursuant to
Section 7(a) hereof owed by the Company, and payment from Trust Agreement No. 7 of
pension benefits owed by the Company. Executive shall make demand on the Company for
any payments due Executive pursuant to Section 7(a) hereof prior to making demand
therefor on the Trustee under Trust Agreement No. 2.

	 	(c)	 	Upon the earlier to occur of (i) a Change in Control or (ii) a declaration by
the Board that a Change Control is imminent, the Company shall promptly to the extent
it has not previously done so, and in any event within five (5) business days:

	 	(A)	 	transfer to Trustee to be added to the
principal of the Trust under Trust Agreement No. 1 a sum equal to
(I) the present value on the date of the Change in Control (or on such
fifth business day if the Board has declared a Change in Control to be
imminent) of the payments to be made to Executive under the provisions
of Annex A and Section 5 hereof, such present value to be computed
using the assumptions set forth in Annex A hereof and the computations
provided for in Section 5 hereof less (II) the balance in the
Executive’s accounts provided for in Trust Agreement No. 1 as of the
most recent completed valuation thereof, as certified by the Trustee
under Trust Agreement No. 1 less (III) the balance in the Executive’s
accounts provided for in Trust Agreement No. 7 as of the most recently
completed valuation thereof, as certified by the Trustee under Trust
Agreement No. 7; provided, however, that if the Trustee under Trust
Agreement No. 1 and/or Trust Agreement No. 7 does not so certify by the
end of the fourth (4th) business day after the earlier of such Change
in Control or declaration, then the balance of such respective account
shall be deemed to be zero. Any payments of compensation, pension or
other benefits by the Trustee pursuant to Trust Agreement No. 1 or
Trust Agreement No. 7 shall, to the extent thereof, discharge the
Company’s obligation to pay compensation, pension and other benefits
hereunder, it being the intent of the Company that assets in such
Trusts be held as security for the Company’s obligation to pay
compensation, pension and other benefits under this Agreement; and

	 	(B)	 	transfer to the Trustee to be added to the
principal of the Trust under Trust Agreement No. 2 the sum of TWO
HUNDRED FIFTY THOUSAND DOLLARS ($250,000) less any principal in such
Trust on such fifth business day. Any payments of the Executive’s
attorneys’ and related fees and expenses by the Trustee pursuant to
Trust Agreement No. 2 shall, to the extent thereof, discharge the
Company’s obligation hereunder, it being the intent of the Company that
assets in such Trust be held as security for the Company’s obligation
under Section 7(a) hereof. Executive understands and acknowledges that
the entire corpus of the Trust under Trust Agreement No. 2 will be
$250,000 and that said amount will be available to discharge not only
the obligations of the Company to Executive under Section 7(a) hereof,
but also similar obligations of the Company to other executives and
employees under similar provisions of other agreements and plans.

	 	9.	 	Competitive Activity; Confidentiality; Nonsolicitation.(a) (a) During
the Term, if the Executive shall have received or shall be receiving benefits under
Section 4, and, if applicable, Section 5, the Executive shall not, without the prior
written consent of the Company, which consent shall not be unreasonably withheld,
engage in any Competitive Activity.

	 	(b)	 	During the Term, the Company agrees that it will disclose to Executive its
confidential or proprietary information (as defined in this Section 9(b)) to the extent
necessary for Executive to carry out his obligations to the Company. The Executive
hereby covenants and agrees that he will not, without the prior written consent of the
Company, during the Term or thereafter disclose to any person not employed by the
Company, or use in connection with engaging in competition with the Company, any
confidential or proprietary information of the Company. For purposes of this
Agreement, the term “confidential or proprietary information” will include all
information of any nature and in any form that is owned by the Company and that is not
publicly available (other than by Executive’s breach of this Section 9(b)) or generally
known to persons engaged in businesses similar or related to those of the Company.
Confidential or proprietary information will include, without limitation, the Company’s
financial matters, customers, employees, industry contracts, strategic business plans,
product development (or other proprietary product data), marketing plans, and all other
secrets and all other information of a confidential or proprietary nature. For
purposes of the preceding two sentences, the term “Company” will also include any
Subsidiary (collectively, the “Restricted Group”). The foregoing obligations imposed
by this Section 9(b) will not apply (i) during the Term, in the course of the business
of and for the benefit of the Company, (ii) if such confidential or proprietary
information will have become, through no fault of the Executive, generally known to the
public or (iii) if the Executive is required by law to make disclosure (after giving
the Company notice and an opportunity to contest such requirement).

	 	(c)	 	The Executive hereby covenants and agrees that during the Term Executive will
not, without the prior written consent of the Company, which consent shall not
unreasonably be withheld, on behalf of Executive or on behalf of any person, firm or
company, directly or indirectly, attempt to influence, persuade or induce, or assist
any other person in so persuading or inducing, any employee of the Restricted Group to
give up, or to not commence, employment or a business relationship with the Restricted
Group.

	 	(c)	 	The Executive further agrees that he shall return, within 10 days of the
effective date of his termination as an employee of the Company and any Subsidiary, in
good condition, all property of the Company and any Subsidiary then in his possession,
including, without limitation, whether in hard copy or in media (i) property, documents
and/or all other materials (including copies, reproductions, summaries and/or analyses)
which constitute, refer or relate to Confidential Information of the Company or any
Subsidiary, (ii) keys to property of the Company or any Subsidiary, (iii) files and
(iv) blueprints or other drawings.

	 	(d)	 	The Executive further acknowledges and agrees that his obligation of
confidentiality shall survive until and unless such Confidential Information of the
Company or any Subsidiary shall have become, through no fault of the Executive,
generally known to the public or the Executive is required by law (after providing the
Company with notice and opportunity to contest such requirement) to make disclosure.
The Executive’s obligations under this Section are in addition to, and not in
limitation or preemption of, all other obligations of confidentiality which the
Executive may have to the Company and any Subsidiary under general legal or equitable
principles or statutes.

	 	(e)	 	During the Term, the Executive further agrees that he will not, directly or
indirectly:

(i) induce or attempt to induce customers, business relations or accounts of
the Company or any of the Subsidiaries to relinquish their contracts or
relationships with the Company or any of the Subsidiaries; or

(ii) solicit, entice, assist or induce other employees, agents or independent
contractors to leave the employ of the Company or any of the Subsidiaries or to
terminate their engagements with the Company and/or any of the Subsidiaries or
assist any competitors of the Company or any of the Subsidiaries in securing the
services of such employees, agents or independent contractors.

	10.	 	Release. Receipt of Severance Compensation by the Executive is conditioned upon the
Executive executing and delivering to the Company a release substantially in the form provided
in Exhibit A.

	11.	 	Employment Rights. Nothing expressed or implied in this Agreement shall create any
right or duty on the part of the Company, a Subsidiary or the Executive to have the Executive
remain in the employment of the Company or a Subsidiary at any time prior to or following a
Change in Control. Any termination of employment of the Executive or the removal of the
Executive from the office or position in the Company or a Subsidiary prior to a Change in
Control but following the commencement of any discussion with any third person that ultimately
results in a Change in Control shall be deemed to be a termination or removal of the Executive
after a Change in Control for all purposes of this Agreement.

	12.	 	Withholding of Taxes. The Company may withhold from any amounts payable under this
Agreement all federal, state, city or other taxes as the Company is required to withhold
pursuant to any applicable law, regulation or ruling.

	 	13.	 	Successors and Binding Agreement.(a) (a) The Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise) to all or substantially all of the business or assets of
the Company, by agreement in form and substance reasonably satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in the same manner
and to the same extent the Company would be required to perform if no such succession
had taken place. This Agreement will be binding upon and inure to the benefit of the
Company and any successor to the Company, including without limitation any persons
acquiring directly or indirectly all or substantially all of the business or assets of
the Company whether by purchase, merger, consolidation, reorganization or otherwise
(and such successor shall thereafter be deemed the “Company” for the purposes of this
Agreement), but will not otherwise be assignable, transferable or delegable by the
Company.

	 	(b)	 	This Agreement will inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators, successors,
heirs, distributees and legatees.

	 	(c)	 	This Agreement is personal in nature and neither of the parties hereto shall,
without the consent of the other, assign, transfer or delegate this Agreement or any
rights or obligations hereunder except as expressly provided in Sections 11(a) and
11(b). Without limiting the generality or effect of the foregoing, the Executive’s
right to receive payments hereunder will not be assignable, transferable or delegable,
whether by pledge, creation of a security interest, or otherwise, other than by a
transfer by Executive’s will or by the laws of descent and distribution and, in the
event of any attempted assignment or transfer contrary to this Section 11(c), the
Company shall have no liability to pay any amount so attempted to be assigned,
transferred or delegated.

	 	(d)	 	The obligation of the Company to make payments and/or provide benefits
hereunder shall represent an unsecured obligation of the Company.

	 	(e)	 	The Company recognizes that each Executive will have no adequate remedy at law
for breach by the Company of any of the agreements contained herein and, in the event
of any such breach, the Company hereby agrees and consents that each Executive shall be
entitled to a decree of specific performance, mandamus or other appropriate remedy to
enforce performance of obligations of the Company under this Agreement.

	14.	 	Notices. For all purposes of this Agreement, all communications, including without
limitation notices, consents, requests or approvals, required or permitted to be given
hereunder will be in writing and will be deemed to have been duly given when hand delivered or
dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or
five business days after having been mailed by United States registered or certified mail,
return receipt requested, postage prepaid, or three business days after having been sent by a
nationally recognized overnight courier service such as FedEx, UPS, or Purolator, addressed to
the Company (to the attention of the Secretary of the Company) at its principal executive
office and to the Executive at his principal residence, or to such other address as any party
may have furnished to the other in writing and in accordance herewith, except that notices of
changes of address shall be effective only upon receipt.

	15.	 	Governing Law. The validity, interpretation, construction and performance of this
Agreement will be governed by and construed in accordance with the substantive laws of the
State of Ohio, without giving effect to the principles of conflict of laws of such State.

	16.	 	Validity. If any provision of this Agreement or the application of any provision
hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the
remainder of this Agreement and the application of such provision to any other person or
circumstances will not be affected, and the provision so held to be invalid, unenforceable or
otherwise illegal will be reformed to the extent (and only to the extent) necessary to make it
enforceable, valid or legal.

	17.	 	Administration of this Agreement.

	 	(a)	 	In General: This Agreement shall be administered by the Company.

	 	(b)	 	Delegation of Duties: The Company may delegate any of its
administrative duties, including, without limitation, duties with respect to the
processing, review, investigation, approval and payment of severance pay and Gross-up
Payments, to named administrator or administrators.

	 	(c)	 	Regulations: The Company shall promulgate any rules and regulations it
deems necessary in order to carry out the purposes of this Agreement or to interpret
the terms and conditions of this Agreement; provided, however, that no rule, regulation
or interpretation shall be contrary to the provisions of this Agreement.

	 	(d)	 	Claims Procedure: Subject to the provisions of Section 5, the Company
shall determine the rights of any employee of the Company to any Severance Compensation
or a Gross-up Payment hereunder. Any employee or former employee of the Company or a
Subsidiary who believes that he has not received any benefit under this Agreement to
which he believes he is entitled, may file a claim in writing with the Vice President
Human Resources. The Company shall, no later than 90 days after the receipt of a
claim, either allow or deny the claim by written notice to the claimant. If a claimant
does not receive written notice of the Company’s decision on his claim within such
90-day period, the claim shall be deemed to have been denied in full.

A denial of a claim by the Company, wholly or partially, shall be written in a manner calculated to
be understood by the claimant and shall include:

	 	(i)	 	the specific reason or reasons for the denial;

	 	(ii)	 	specific reference to pertinent provisions of this Agreement on
which the denial is based;

	 	(iii)	 	a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of why such
material or information is necessary; and

	 	(iv)	 	an explanation of the claim review procedure.

A claimant whose claim is denied (or his duly authorized representative) may, within 30 days after
receipt of denial of his claim, request a review of such denial by the Company by filing with the
Secretary of the Company a written request for review of his claim. If the claimant does not file
a request for review with the Company within such 30-day period, the claimant shall be deemed to
have acquiesced in the original decision of the Company on his claim. If a written request for
review is so filed within such 30-day period, the Company shall conduct a full and fair review of
such claim. During such full review, the claimant shall be given the opportunity to review
documents that are pertinent to his claim and to submit issues and comments in writing. The
Company shall notify the claimant of its decision on review within 60 days after receipt of a
request for review. Notice of the decision on review shall be in writing. If the decision on
review is not furnished to the claimant within such 60-day period, the claim shall be deemed to
have been denied on review.

	 	(e)	 	Revocability of Action: Any action taken by the Company with respect to
the rights or benefits under this Agreement of the Executive shall be revocable by the
Company as to payments or distributions not yet made to such person, and acceptance of
Severance Pay or a Gross-up Payment under this Agreement constitutes acceptance of and
agreement to the Company making any appropriate adjustments in future payments or
distributions to such person to offset any excess or underpayment previously made to
him.

	 	(f)	 	Requirement of Receipt: Upon receipt of any Severance Compensation or
a Gross-up Payment hereunder, the Company reserves the right to require any Executive
to execute a receipt evidencing the amount and payment of such Severance Compensation
and/or Gross-up Payment.

	18.	 	Amendment and Termination. The Company reserves the right, except as hereinafter
provided, at any time and from time to time, to amend, modify, change or terminate this
Agreement and/or any Committee Action, including any Exhibit thereto; provided, however, that
any such amendment, modification, change or termination that adversely affects the rights of
the Executive under this Agreement may not be made without the written consent of the
Executive.

	18.	 	Special Amendments. Notwithstanding any other provision of this Agreement, on or
prior to the last day on which amendments can be made to this Agreement to bring it into
compliance with or make it exempt from the requirements of Internal Revenue Code Section 409A,
such an amendment can be unilaterally made by:

	 	(a)	 	The Company as long as a Change in Control has
not occurred; or

	 	(b)	 	The Executive if a Change in Control has
occurred.

Notwithstanding the foregoing, in the event that the proposed or final Treasury
Regulations and other guidance available on such last day prohibit accelerating any payments
into 2006 (or a subsequent year) and/or prohibit deferring any payments which would have
been paid in 2006 (or a subsequent year) into a later year, then any such amendment pursuant
to this Section will comply with such prohibitions. In addition, any such amendment shall
not increase the severance benefits of the Executive beyond what are set forth in the
Agreement.

	19.	 	Other Plans, etc. If the terms of this Agreement are inconsistent with the
provisions of any other plan, program, contract or arrangement of the Company or any
Subsidiary, to the extent such plan, program, contract or arrangement may be amended by the
Company or a Subsidiary, the terms of this Agreement will be deemed to so amend such plan,
program, contract or arrangement, and the terms of this Agreement will govern. This Agreement
supersedes and replaces the Cleveland-Cliffs Inc Change in Control Severance Pay Plan.

	20.	 	Construction. The masculine gender, when used in this Agreement, shall be deemed to
include the feminine gender and the singular number shall include the plural, unless the
context clearly indicates to the contrary.

	21.	 	Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the
same agreement.

IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered
as of the date first above written.

	 	 	 
	CLEVELAND-CLIFFS INC

By:

	 	

/s/ Joseph A. Carrabba

Joseph A. Carrabba

Chairman and Chief Executive Officer

1

/s/ Laurie Brlas

Executive

CLEVELAND-CLIFFS INC

SEVERANCE AGREEMENT

ANNEX A

Severance Compensation

(1) A lump sum payment in an amount equal to three (3) times the sum of (A) Base Pay
(at the highest rate in effect for any period prior to the Termination Date), plus (B) Incentive
Pay (in an amount equal to not less than the greater of (i) the target bonus and/or target award
opportunity for the fiscal year immediately preceding the year in which the Change in Control
occurred, or (ii) the target bonus and/or target award opportunity for the fiscal year in which the
Termination Date occurs).

(2) For a period of thirty-six (36) months following the Termination Date (the
“Continuation Period”), the Company will arrange to provide the Executive with Employee Benefits
that are welfare benefits (but not stock option, performance share, performance unit, stock
purchase, stock appreciation or similar compensatory benefits) substantially similar to those that
the Executive was receiving or entitled to receive immediately prior to the Termination Date (or,
if greater, immediately prior to the reduction, termination, or denial described in Section
3(b)(ii)). If and to the extent that any benefit described in this Paragraph 2 is not or cannot be
paid or provided under any policy, plan, program or arrangement of the Company or any Subsidiary,
as the case may be, then the Company will itself pay or provide for the payment to the Executive,
his dependents and beneficiaries, of such Employee Benefits along with, in the case of any benefit
described in this Paragraph 2 which is subject to tax because it is not or cannot be paid or
provided under any such policy, plan, program or arrangement of the Company or any Subsidiary, an
additional amount such that after payment by the Executive, or his dependents or beneficiaries, as
the case may be, of all taxes so imposed, the recipient retains an amount equal to such taxes.
Notwithstanding the foregoing, or any other provision of the Agreement, for purposes of determining
the period of continuation coverage to which the Executive or any of his dependents is entitled
pursuant to Section 4980B of the Code (or any successor provision thereto) under the Company’s
medical, dental and other group health plans, or successor plans, the Executive’s “qualifying
event” shall be the termination of the Continuation Period and the Executive shall be considered to
have remained actively employed on a full-time basis through that date. Without otherwise limiting
the purposes or effect of Section 5, Employee Benefits otherwise receivable by the Executive
pursuant to this Paragraph 2 will be reduced to the extent comparable welfare benefits are actually
received by the Executive from another employer during the Continuation Period following the
Executive’s Termination Date, and any such benefits actually received by the Executive shall be
reported by the Executive to the Company.

(3) A lump sum payment (the “SRP Payment”) in an amount equal to the sum of the future pension
benefits (converted to a lump sum of actuarial equivalence) which the Executive would have been
entitled to receive two (2) years following the Termination Date under the SRP, and as modified by
this Paragraph (3) (assuming Base Salary and Incentive Pay as determined in Paragraph (1), if the
Executive had remained in the full-time employment of the Company until two (2) years following the
Termination Date.

The calculation of the SRP Payment and its actuarial equivalence shall be made as of the
Termination Date. The lump sum of actuarial equivalence shall be calculated as of two (2) years
following the Termination Date using the assumptions and factors used in the SRP, and such sum
shall be discounted to the date of payment using a discount rate prescribed for purposes of
valuation computations under Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”) or any successor provision thereto, or if no rate is so prescribed, a rate equal to the
then “applicable interest rate” under Section 417(e)(3)(A)(ii)(II) of the Code for the month in
which the Termination Date occurs.

The Company hereby waives the discretionary right, at any time subsequent to the date of a Change
in Control, to amend or terminate the SRP as to the Executive as provided in paragraph 7 thereof or
to terminate the rights of the Executive or his beneficiary under the SRP in the event Executive
engages in a competitive business as provided in any plan or arrangement between the Company and
the Executive or applicable to the Executive, including but not limited to, the provisions of
paragraph 4 of the SRP, or any similar provisions of any such plan or arrangement or other plan or
arrangement supplementing or superseding the same. This Paragraph (3) shall constitute a
“Supplemental Agreement” as defined in Paragraph 1.J of the SRP. If the Company shall terminate
the Executive’s employment during the Severance Period, other than for Cause pursuant to Section
3(a)(i), 3(a)(ii) or 3(a)(iii) of the Agreement, or if the Executive shall terminate his employment
pursuant to Section 3(b) of the Agreement, or if, following the end of the Severance Period, the
Executive’s employment is terminated for any reason, for the purposes of computing the Executive’s
period of continuous service and of calculating and paying his benefit under the SRP:

(A) At the time of his termination of employment with the Company (by death or
otherwise), the Executive shall be credited with years of continuous service for
benefit accrual and eligibility equal to the greater of (i) the number of his actual
years of continuous service or (ii) the number of years of continuous service he
would have had if he had continued his employment with the Company for two (2) years
after the Termination Date, and had he attained the greater of (iii) his actual
chronological age, (iv) sixty-five, or (v) his chronological age two (2) years after
the Termination Date. In addition, the Executive shall be eligible for a 30-year
pension benefit based upon his years of continuous service as computed under the
preceding sentence. Such Executive shall be eligible to commence a 30-year pension
benefit on the earlier of (vi) the date upon which the Executive would have
otherwise reached 30 years of continuous service with the Company but for his
termination of employment after the Change in Control at which time the Executive
shall be deemed to be age 65, or (vii) the date upon which the sum of the
Executive’s years of continuous service (as computed in the first sentence of this
subparagraph (A)) and the Executive’s Credited Years of Industry Service is equal
to 30 years of service, at which time the Executive shall be deemed to be age 65;
and

(B) The Executive shall be a “Participant” in the SRP, notwithstanding any
limitations therein. The terms of the Agreement and this Annex A shall take
precedence to the extent they are contrary to provisions contained in the SRP.

Payment of the SRP Payment by the Company shall be deemed to be a satisfaction of all obligations
of the Company to the Executive under the SRP.

(4) Base Salary through the Termination Date plus prorata Incentive Pay for the year in which
the Termination Date occurs calculated at the greater of (i) the target bonus and/or target
opportunity or (ii) actual performance, in each case for the fiscal year in which the Termination
Date occurs.

(5) In lieu of the Executive’s right to receive deferred compensation under the Voluntary
Non-Qualified Deferred Compensation Plan or any other plan providing for deferral of income or
amounts otherwise payable to the Executive, a lump sum payment in cash in an amount equal to 100%
of the Executive’s cash and stock account balances under such plans.

(6) Outplacement services by a firm selected by the Executive, at the expense of the Company
in an amount up to 15% of the Executive’s Base Pay.

(7) Post-retirement medical, hospital, surgical and prescription drug coverage for the
lifetime of the Executive, his spouse and any eligible dependents equivalent to that which would
have been furnished on the day prior to the Change in Control to an officer of the Company who
retired on such date with full eligibility for such benefits.

2

CLEVELAND-CLIFFS INC

SEVERANCE AGREEMENT

EXHIBIT A

Form of Release

WHEREAS, the Executive’s employment has been terminated in accordance with Section 3 of the
Severance Agreement (the “Agreement”) dated as of January 8, 2007 between the Executive
and Cleveland-Cliffs Inc; and

WHEREAS, the Executive is required to sign this Release in order to receive the Severance
Compensation (as such term is defined in the Agreement) as described in Annex A of the Agreement
and the other benefits described in the Agreement.

NOW THEREFORE, in consideration of the promises and agreements contained herein and other good
and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, and
intending to be legally bound, the Executive agrees as follows:

1. This Release is effective on the date hereof and will continue in effect as provided
herein.

2. In consideration of the payments to be made and the benefits to be received by the
Executive pursuant to the Agreement, which the Executive acknowledges are in addition to payments
and benefits which the Executive would be entitled to receive absent the Agreement (other than
severance pay and benefits under any other severance plan, policy, program or arrangement sponsored
by Cleveland-Cliffs Inc), the Executive, for herself and her dependents, successors, assigns,
heirs, executors and administrators (and her and their legal representatives of every kind), hereby
releases, dismisses, remises and forever discharges Cleveland-Cliffs Inc, its predecessors,
parents, subsidiaries, divisions, related or affiliated companies, officers, directors,
stockholders, members, employees, heirs, successors, assigns, representatives, agents and counsel
(the “Company”) from any and all arbitrations, claims, including claims for attorney’s fees,
demands, damages, suits, proceedings, actions and/or causes of action of any kind and every
description, whether known or unknown, which Executive now has or may have had for, upon, or by
reason of any cause whatsoever (“claims”), against the Company, including but not limited to:

(a) any and all claims arising out of or relating to Executive’s employment by or
service with the Company and his termination from the Company;

(b) any and all claims of discrimination, including but not limited to claims of
discrimination on the basis of sex, race, age, national origin, marital status, religion or
handicap, including, specifically, but without limiting the generality of the foregoing, any
claims under the Age Discrimination in Employment Act, as amended, Title VII of the Civil
Rights Act of 1964, as amended, the Americans with Disabilities Act, Ohio Revised Code
Section 4101.17 and Ohio Revised Code Chapter 4112, including Sections 4112.02 and 4112.99
thereof; and

(c) any and all claims of wrongful or unjust discharge or breach of any contract or
promise, express or implied.

3. Executive understands and acknowledges that the Company does not admit any violation of
law, liability or invasion of any of his rights and that any such violation, liability or invasion
is expressly denied. The consideration provided for this Release is made for the purpose of
settling and extinguishing all claims and rights (and every other similar or dissimilar matter)
that Executive ever had or now may have against the Company to the extent provided in this Release.
Executive further agrees and acknowledges that no representations, promises or inducements have
been made by the Company other than as appear in the Agreement.

4. Executive further agrees and acknowledges that:

(a) The release provided for herein releases claims to and including the date of this
Release;

(b) She has been advised by the Company to consult with legal counsel prior to
executing this Release, has had an opportunity to consult with and to be advised by legal
counsel of her choice, fully understands the terms of this Release, and enters into this
Release freely, voluntarily and intending to be bound;

(c) She has been given a period of 21 days to review and consider the terms of this
Release, prior to its execution and that she may use as much of the 21 day period as she
desires; and

(d) She may, within 7 days after execution, revoke this Release. Revocation shall be
made by delivering a written notice of revocation to the Vice President Human Resources at
the Company. For such revocation to be effective, written notice must be actually received
by the Vice President Human Resources at the Company no later than the close of business on
the 7th day after Executive executes this Release. If Executive does exercise his right to
revoke this Release, all of the terms and conditions of the Release shall be of no force and
effect and the Company shall not have any obligation to make payments or provide benefits to
Executive as set forth in Sections 4, 5, and 7 of the Agreement.

5. Executive agrees that he will never file a lawsuit or other complaint asserting any claim
that is released in this Release.

6.

3

Executive waives and releases any claim that he has or may have to reemployment after
     .

IN WITNESS WHEREOF, the Executive has executed and delivered this Release on the date set
forth below.

	 	 	Dated:

Executive

4

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