10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 - For the Period Ended June 30, 2008

Or

o   Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 - For the Transition Period From ________________________ to________________________

Commission file number 1-701

GREAT NORTHERN IRON ORE PROPERTIES

(Exact name of registrant as specified in its charter)

Minnesota	41-0788355
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
W-1290 First National Bank Building 332 Minnesota Street Saint Paul, Minnesota	55101-1361
(Address of principal executive office)	(Zip Code)
(651) 224-2385
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer (as defined in Rule 12b-2 of the Act).

Large accelerated filer  o    Accelerated filer  x    Non-accelerated filer  o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).   Yes  o   No  x

Number of shares of beneficial interest outstanding on June 30, 2008:    1,500,000

PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements

GREAT NORTHERN IRON ORE PROPERTIES

CONDENSED BALANCE SHEETS

	June 30 2008		December 31 2007
ASSETS	(Unaudited)		(Note)
CURRENT ASSETS
Cash and cash equivalents	$	983,039	$	979,175
United States Treasury securities		4,459,474		4,997,278
Royalties receivable		3,295,136		2,924,517
Prepaid expenses		34,902		4,519
TOTAL CURRENT ASSETS		8,772,551		8,905,489
NONCURRENT ASSETS
United States Treasury securities		2,498,528		4,755,295
PROPERTIES
Mineral and surface lands		38,691,707		38,691,707
Less: Allowances for depletion and amortization		-35,050,435		-34,940,185
		3,641,272		3,751,522
Building and equipment		311,342		313,891
Less: Allowances for accumulated depreciation		-212,134		-200,321
		99,208		113,570
TOTAL PROPERTIES		3,740,480		3,865,092
TOTAL ASSETS	$	15,011,559	$	17,525,876
LIABILITIES AND BENEFICIARIES' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	61,106	$	95,356
Distributions		3,150,000		4,350,000
TOTAL CURRENT LIABILITIES		3,211,106		4,445,356
NONCURRENT LIABILITIES
Deferred compensation		102,400		102,400
Liability for pension benefits		1,073,829		979,064
TOTAL NONCURRENT LIABILITIES		1,176,229		1,081,464
TOTAL LIABILITIES		4,387,335		5,526,820
BENEFICIARIES' EQUITY, including certificate holders' equity, represented by 1,500,000 certificates (shares or units) of beneficial interest authorized and outstanding, and the reversionary interest		12,141,867		13,580,035
Accumulated other comprehensive loss		-1,517,643		-1,580,979
TOTAL BENEFICIARIES' EQUITY		10,624,224		11,999,056
TOTAL LIABILITIES AND BENEFICIARIES' EQUITY	$	15,011,559	$	17,525,876

Note:  The balance sheet at December 31, 2007, has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

See notes to condensed financial statements.

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GREAT NORTHERN IRON ORE PROPERTIES

CONDENSED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended June 30						Six Months Ended June 30
	2008			2007			2008			2007
Revenues:
Royalties	$	3,538,825		$	5,132,657		$	5,813,723		$	8,312,508
Interest and other income		99,312			115,411			244,211			287,694
		3,638,137			5,248,068			6,057,934			8,600,202
Costs and expenses		663,647			684,110			1,346,102			1,392,703
NET INCOME	$	2,974,490		$	4,563,958		$	4,711,832		$	7,207,499
Weighted-average shares outstanding		1,500,000			1,500,000			1,500,000			1,500,000
BASIC & DILUTED EARNINGS PER SHARE	$	1.98		$	3.04		$	3.14		$	4.80
Distributions declared per share	$	2.10	(1)	$	2.30	(2)	$	4.10	(3)	$	4.30	(4)

(1)	$2.10	declared	6/11/2008
		payable	7/31/2008
(2)	$2.30	declared	6/19/2007
		paid	7/31/2007
(3)	$2.00	declared	3/10/2008	plus	$2.10	declared	6/11/2008
		paid	4/30/2008			payable	7/31/2008
(4)	$2.00	declared	3/9/2007	plus	$2.30	declared	6/19/2007
		paid	4/30/2007			paid	7/31/2007

See notes to condensed financial statements.

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GREAT NORTHERN IRON ORE PROPERTIES

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

	Six Months Ended June 30
	2008		2007
Cash flows from operating activities:
Cash received from royalties and rents	$	5,492,794	$	7,921,842
Cash paid to suppliers and employees		-1,128,022		-1,095,472
Interest received		189,092		216,684
NET CASH PROVIDED BY OPERATING ACTIVITIES		4,553,864		7,043,054
Cash flows from investing activities:
U.S. Treasury securities purchased		-700,000		-1,375,000
U.S. Treasury securities matured		3,500,000		1,800,000
NET CASH PROVIDED BY INVESTING ACTIVITIES		2,800,000		425,000
Cash flows from financing activities:
Distributions paid		-7,350,000		-7,950,000
NET CASH USED IN FINANCING ACTIVITIES		-7,350,000		-7,950,000
Net increase (decrease) in cash and cash equivalents		3,864		-481,946
Cash and cash equivalents at beginning of year		979,175		1,131,504
CASH AND CASH EQUIVALENTS AT JUNE 30	$	983,039	$	649,558

See notes to condensed financial statements.

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GREAT NORTHERN IRON ORE PROPERTIES

NOTES TO CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Periods of Three and Six Months ended June 30, 2008 and June 30, 2007

Note A – BASIS OF PRESENTATION

The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the periods stated above are not necessarily indicative of the results that may be expected for each respective full year. For further information, refer to the financial statements and footnotes included in the Great Northern Iron Ore Properties (“Trust”) Annual Report on Form 10-K for the year ended December 31, 2007.

Note B – BENEFICIARIES’ EQUITY

Pursuant to the Court Order of November 29, 1982, the Trustees were directed to create and maintain an account designated as “Principal Charges.” This account constitutes a first and prior lien of certificate holders on any property transferable to the reversioner and reflects an allocation of beneficiaries’ equity between the certificate holders and the reversioner. This account is neither an asset nor a liability of the Trust. Rather, this account maintains and represents a balance which will be payable to the certificate holders of record from the reversioner at the end of the Trust. The balance in this account consists of attorneys’ fees and expenses of counsel for adverse parties pursuant to the Court Order in connection with litigation commenced in 1972 relating to the Trustees’ powers and duties under the Trust Agreement and the costs of homes and surface lands acquired in accordance with provisions of a lease with United States Steel Corporation, net of an allowance to amortize the cost of the land based on actual shipments of taconite and net of a credit for disposition of tangible assets. Following is an analysis of this account as of June 30, 2008:

Attorneys’ fees and expenses	$	1,024,834
Cost of surface lands		6,057,365
Cumulative shipment credits		-1,788,982
Cumulative asset disposition credits		-119,241
Principal Charges account balance	$	5,173,976

Upon termination of the Trust, the Trustees shall either sell tangible assets or obtain a loan with tangible assets as security to provide monies for distribution to the certificate holders in the amount of the Principal Charges account balance.

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Note C – PENSION PLAN

A summary of the components of net periodic pension cost is as follows:

	Three Months Ended June 30				Six Months Ended June 30
	2008		2007		2008		2007
Service cost	$	56,605	$	60,346	$	113,210	$	120,691
Interest cost		82,318		81,961		164,636		163,921
Expected return on assets		-91,540		-86,423		-183,081		-172,845
Amortization of net loss		27,300		38,890		54,601		77,781
Amortization of prior service cost		4,368		4,368		8,735		8,735
Net periodic pension cost	$	79,051	$	99,142	$	158,101	$	198,283

The plan’s annual actuarial valuation was performed as of the plan’s fiscal year-end March 31. The actuarially recommended contribution to the pension plan for 2008 was $412,422, which contribution is scheduled to be made in August or September of 2008.

Note D – COMPREHENSIVE INCOME

A summary of the components of comprehensive income is as follows:

	Three Months Ended June 30				Six Months Ended June 30
	2008		2007		2008		2007
Net income	$	2,974,490	$	4,563,958	$	4,711,832	$	7,207,499
Other comprehensive income:
Defined benefit pension plan, pursuant to SFAS No. 158 –
Amortization of net loss		27,300		38,890		54,601		77,781
Amortization of prior service cost		4,368		4,368		8,735		8,735
Total other comprehensive income		31,668		43,258		63,336		86,516
Total comprehensive income	$	3,006,158	$	4,607,216	$	4,775,168	$	7,294,015

Note E – NEW ACCOUNTING STANDARDS

During May 2008, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 162 “The Hierarchy of Generally Accepted Accounting Principles.” This Statement is intended to improve the financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with United States generally accepted accounting principles. This Statement is not expected to have any impact on the Trust.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

Periods of Three and Six Months ended June 30, 2008 and June 30, 2007

The Trust owns interest in 12,033 acres on the Mesabi Iron Range Formation in northeastern Minnesota, most of which are under lease to major iron ore producing companies. Due to the Trustees’ election pursuant to Section 646 of the Tax Reform Act of 1986, as amended, commencing with year 1989 the Trust is not subject to federal and Minnesota corporate income taxes. The Trust is now a grantor trust. Shares of beneficial interest in the Trust are traded on the New York Stock Exchange under the ticker symbol “GNI” (CUSIP No. 391064102).

The terms of the Great Northern Iron Ore Properties Trust Agreement, created December 7, 1906, state that the Trust shall continue for twenty years after the death of the last survivor of eighteen persons named in the Trust Agreement. The last survivor of these eighteen persons died on April 6, 1995. Accordingly, the Trust terminates twenty years from April 6, 1995, that being April 6, 2015.

At the end of the Trust on April 6, 2015, the certificates of beneficial interest (shares) in the Trust will cease to trade on the New York Stock Exchange and thereafter will represent only the right to receive certain distributions payable to the certificate holders of record at the time of the termination of the Trust. Upon termination, the Trust is obligated to distribute ratably to these certificate holders the net monies remaining in the hands of the Trustees (after paying and providing for all expenses and obligations of the Trust), plus the balance in the Principal Charges account (this account is explained in the Trust’s Annual Report sent to all certificate holders every year). All other Trust property (most notably the Trust’s mineral properties and the active leases) must be conveyed and transferred to the reversioner (currently Glacier Park Company, a wholly owned subsidiary of ConocoPhillips) under the terms of the Trust Agreement.

We have previously provided information in our various Securities and Exchange Commission filings, including our Annual Report, about the final distribution payable to the certificate holders upon the Trust’s termination. The exact final distribution, though not determinable at this time, will generally consist of the sum of the Trust’s net monies (essentially, total assets less liabilities and properties) and the balance in the Principal Charges account, less any and all expenses and obligations of the Trust upon termination. To offer a hypothetical example, without factoring in any expenses and obligations of the Trust upon its termination, and using the financial statement values as of December 31, 2007, the net monies were approximately $8,134,000 and the Principal Charges account balance was approximately $5,037,000, resulting in a final distribution payable of approximately $13,171,000, or about $8.78 per share. After payment of this final distribution, the certificates of beneficial interest (shares) would be cancelled and have no further value. It is important to note, however, that the actual net monies on hand and the Principal Charges account balance will most likely fluctuate during the ensuing years and will not be “final” until after the termination and wind-down of the Trust. The Trust offers this example to further inform investors about the conceptual nature of the final distribution and does not imply or guarantee a specific known final distribution amount.

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Results of Operations:

Royalties decreased $2,498,785 and $1,593,832 during the six months and three months ended June 30, 2008, respectively, as compared to the same periods in 2007, due mainly to reduced mining on Trust lands caused by unusually high water conditions in the mining pits that are hampering our lessees’ mining operations.

Interest and other income decreased $43,483 and $16,099 during the six months and three months ended June 30, 2008, respectively, as compared to the same periods in 2007, due mainly to reduced yields on the Trust’s investments.

Costs and expenses decreased $46,601 and $20,463 during the six months and three months ended June 30, 2008, respectively, as compared to the same periods in 2007, due mainly to reduced net periodic pension cost pertaining to the Trust’s pension plan.

At their meeting held on June 11, 2008, the Trustees declared a distribution of $2.10 per share, amounting to $3,150,000 payable July 31, 2008, to certificate holders of record at the close of business on June 30, 2008. The Trustees have now declared two quarterly distributions in 2008. The first, in the amount of $2.00 per share, was paid on April 30, 2008 to certificate holders of record on March 31, 2008; and the second, that being the current distribution. The first and second quarter 2007 distributions were $2.00 and $2.30 per share, respectively. The Trustees intend to continue quarterly distributions and set the record date as of the last business day of each quarter. The next distribution will be paid in late October 2008 to certificate holders of record on September 30, 2008.

A mining agreement dated January 1, 1959, with United States Steel Corporation provides that one-half of annual earned royalty income, after satisfaction of minimum royalty payments, shall be applied to reimburse the lessee for a portion of its cost of acquisition of surface lands overlying the leased mineral deposits, which surface lands are then conveyed to the Trustees. There are surface lands yet to be purchased, the costs of which are yet unknown and will not be known until the actual purchases are made.

Liquidity:

In the interest of preservation of principal of Court-approved reserves and guided by the restrictive provisions of Section 646 of the Tax Reform Act of 1986, as amended, monies are invested primarily in U.S. Treasury securities with maturity dates not to exceed three years and, along with cash flows from operations, are deemed adequate to meet currently foreseeable liquidity needs.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

– None

Item 4.  Controls and Procedures

As of the end of the period covered by this report, the Trust conducted an evaluation, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, of the Trust’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934 (the “Exchange Act”)). Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Trust’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the

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Trust in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms. There was no change in the Trust’s internal control over financial reporting during the Trust’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

On May 7, 2008, a Ramsey County District Court Judge presided over a hearing, the purpose of which was to review and approve the accounts of the Trustees for the calendar year 2007, and also for the purpose of considering requested increases in compensation for the Trustees of Great Northern Iron Ore Properties. By Court Order dated May 12, 2008, the Court approved of the accounts of the Trustees for the calendar year 2007 and, further, granted the requested fee increases in Trustee compensation, effective July 1, 2008. Said increases amounted to $20,000 per year to the President’s base salary compensation, $20,000 per year to the President’s bonus compensation (subject to the bonus formula calculation), and a $10,000 per year increase in compensation to each of the Trustees other than the President.

Item 1A.  Risk Factors

There are no material changes from the risk factors previously disclosed in the Trust’s December 31, 2007 Annual Report on Form 10-K.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

– None

Item 3.  Defaults Upon Senior Securities

– None

Item 4.  Submission of Matters to a Vote of Certificate Holders

– None

Item 5.  Other Information

– None

Item 6.  Exhibits

Exhibit No.	Document
– 10.1	Court Order on Trustees’ Compensation (and annual hearing of accounts), dated May 12, 2008, but effective July 1, 2008 (filed as Exhibit 10.1 to Form 8-K of Great Northern Iron Ore Properties filed on May 12, 2008, and incorporated by reference)
– 10.2*	U.S. Steel Corporation Minntac January 1, 1959 Lease and Operating Agreement and all subsequent amendments through September 12, 2003
– 10.3*	Hibbing Taconite Company Mahoning January 1, 1979 Lease and Operating Agreement and all subsequent amendments through January 1, 2006

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Exhibit No.	Document
– 31.1	Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
– 31.2	Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
– 32.1	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002 (Furnished but not filed)

________

* Indicates confidential treatment request as to certain portions of this exhibit that has been filed separately with the Securities and Exchange Commission.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			GREAT NORTHERN IRON ORE PROPERTIES (Registrant)
Date	July 24, 2008	By	/s/ Joseph S. Micallef
			Joseph S. Micallef, President of the Trustees and Chief Executive Officer

Date	July 24, 2008	By	/s/ Thomas A. Janochoski
			Thomas A. Janochoski, Vice President & Secretary and Chief Financial Officer

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QUARTERLY REPORT ON FORM 10-Q

EXHIBIT INDEX

QUARTER ENDED JUNE 30, 2008

GREAT NORTHERN IRON ORE PROPERTIES

W-1290 First National Bank Building

332 Minnesota Street

Saint Paul, Minnesota 55101-1361

Exhibit No.	Document
– 10.1	Court Order on Trustees’ Compensation (and annual hearing of accounts), dated May 12, 2008, but effective July 1, 2008 (filed as Exhibit 10.1 to Form 8-K of Great Northern Iron Ore Properties filed on May 12, 2008, and incorporated by reference)
– 10.2*	U.S. Steel Corporation Minntac January 1, 1959 Lease and Operating Agreement and all subsequent amendments through September 12, 2003
– 10.3*	Hibbing Taconite Company Mahoning January 1, 1979 Lease and Operating Agreement and all subsequent amendments through January 1, 2006
– 31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
– 31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
– 32.1	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002 (Furnished but not filed)

________

* Indicates confidential treatment request as to certain portions of this exhibit that has been filed separately with the Securities and Exchange Commission.

EX-10.2

Exhibit 10.2

U.S. Steel Corporation Minntac January 1, 1959 Lease and Operating Agreement

and all subsequent amendments through September 12, 2003

THIS INDENTURE, made and entered into as of the 1st day of January, 1959, by and between:

PHILIP L. RAY, RALPH BUDD, LOUIS W. HILL, JR., and WILFRID E. RUMBLE, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”;

and

UNITED STATES STEEL CORPORATION, a New Jersey corporation,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH:

The Lessors, for valuable considerations to them paid by the Lessee, receipt whereof is hereby acknowledged, and in further consideration of the covenants on the part of the Lessee to be kept, performed, and observed, as contained in that certain agreement executed simultaneously herewith between the parties hereto (hereinafter referred to as the “Operating Agreement”), do hereby let, lease, and demise unto the Lessee, until and including the 31st day of December, 2057, or until this lease will be sooner terminated in accordance with the provisions of said Operating Agreement, the following described lands and premises situated in the County of St. Louis and State of Minnesota, hereinafter referred to as the “demised premises”, to-wit:

The Southeast quarter of the Northeast quarter (SE¼ of NE¼), the East half of the Southwest quarter (E½ of SW¼), and the Southwest quarter of the Southeast quarter (SW¼ of SE¼) of Section Two (2); the Southwest quarter of the Northeast quarter (SW¼ of NE¼); and the Southeast quarter of the Northwest quarter (SE¼ of NW¼) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

The Southeast quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government survey thereof by Frank D. Howe in 1878; and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast quarter of the Northwest quarter (SE¼ of NW¼), and the West half of the Southwest quarter (W½ of SW¼) of Section One (1); the Northwest quarter (NW¼) and the Northeast quarter of the Southeast quarter (NE¼ of SE¼) of Section Two (2); the East half of the Northeast quarter (E½ of NE¼) of Section Three (3); the Northeast quarter of the Southwest quarter (NE¼ of SW¼), and the South half of the Southwest quarter (S½ of SW¼) of Section Five (5); the Southeast quarter of the Northeast quarter (SE¼ of NE¼) of Section Seven (7); the North half of the Northeast quarter (N½ of NE¼), the Southeast quarter of the Northeast quarter (SE¼ of NE¼), the Northeast quarter of the Northwest quarter (NE¼ of NW¼), the Southwest quarter of the Northwest quarter (SW¼ of NW¼), the North half of the Southwest quarter (N½ of SW¼), and the Southeast quarter (SE¼) of Section Eight (8); the Southwest quarter of the Northwest quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest quarter of the Northeast quarter (NW¼ of NE¼) and the Northeast quarter of the Northwest quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; and all the ores and minerals in, under, and upon also the North half of the Southwest quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; together with all of the mining and other privileges, rights, interests, and estates of the lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine, and remove said ores and minerals); all as such ores and minerals, privileges, rights, interests, and estates were excepted and reserved in prior deeds of record; and together with any and all right, title, and interest that the Lessors may hereafter acquire in or with respect to said lands.

Subject, however, to any and all public highways, railroad rights of way, and electric transmission or telephone lines upon said lands, and to any and all other rights and privileges listed in a schedule attached to said Operating Agreement.

2

TO HAVE AND TO HOLD THE SAME, together with all and singular the hereditaments and appurtenances thereunto belonging or in anywise appertaining, including all mining rights, interests and estates of the Lessors in and to said lands, and all right, title, interest, and estate of the Lessors under or by virtue of or in connection with all easements, licenses, rights of way, leases and other rights heretofore granted on, over or with respect to said lands or any part or parts thereof (excepting the Lessors’ interest under or by virtue of that certain mining lease granted to Skubic Bros. Company covering the Southeast quarter of the Northeast quarter (SE¼ of NE¼) of Section Two (2), Township Fifty-eight (58) North, Range Eighteen (18) West), for the purposes and upon and subject to the terms and provisions herein provided or referred to.

This lease is made and delivered for the purpose of granting to the Lessee, and the Lessee is hereby expressly granted, the exclusive rights and privileges (subject to mining leases heretofore granted) to explore for, mine, remove, beneficiate, and dispose of, for its own account, all the iron formation materials in said lands.

The further considerations for this lease and the rights, privileges, and obligations of the parties with respect to said lands and the use thereof, are all as set forth in said Operating Agreement; and this lease and said Operating Agreement shall always be considered and construed together, and they shall be deemed jointly to constitute but one agreement covering the rights, privileges, and obligations of the parties, reference to said Operating Agreement being hereby made for greater particularity.

3

IN WITNESS WHEREOF, the parties hereto have duly executed this instrument in triplicate as of the day and year first above written.

Signed, Sealed and Delivered in Presence of:
/s/ Mary A. Olson		/s/ Philip L. Ray
		Philip L. Ray
/s/ Dorothy A. Habermaier
As to Philip L. Ray
Signed, Sealed and Delivered in Presence of:
/s/ [illegible]		/s/ Ralph Budd
		Ralph Budd
/s/ R. L. Pendlebury
As to Ralph Budd
/s/ Mary A. Olson		/s/ Louis W. Hill, Jr.
		Louis W. Hill, Jr.
/s/ Dorothy A. Habermaier
As to Louis W. Hill, Jr.
/s/ Mary A. Olson		/s/ Wilfrid E. Rumble
		Wilfrid E. Rumble
/s/ Dorothy A. Habermaier
As to Wilfrid E. Rumble		All as Trustees as aforesaid
	UNITED STATES STEEL CORPORATION
/s/ Benjamin J. Blacik	by	/s/ Christian F. Beukema
		President of its
		Oliver Iron Mining Division
/s/ Emmey J. Prisk	Attest:	/s/ Howard P. Clarke
As to United States Steel Corporation		Its Assistant Secretary

4

STATE OF MINNESOTA,	)
	) ss.
County of Ramsey.	)

On this 13th day of June, 1960 before me, a Notary Public within and for said County and State, appeared PHILIP L. RAY, LOUIS W. HILL, JR., and WILFRID E. RUMBLE, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Mary A. Olson

Notary Public

Ramsey County Minnesota
My Commission Expires January 25, 1962

STATE OF CALIFORNIA,	)
	) ss.
County of Santa Barbara.	)

On this 21st day of June, 1960, before me, a Notary Public within and for said County and State, appeared RALPH BUDD, to me personally known, who, being by me personally sworn, did say that he is a Trustee under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; and that as said Trustee he executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ R. L. Pendlebury

Notary Public

Santa Barbara County, California
My Commission Expires July 8, 1962

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STATE OF MINNESOTA,	)
	) ss.
County of St. Louis.	)

On this 1st day of July, 1960, before me, a Notary Public within and for said County and State, personally appeared CHRISTIAN F. BEUKEMA, to me personally known, who, being by me duly sworn, did say that he is ___________ President of Oliver Iron Mining Division, UNITED STATES STEEL CORPORATION, a New Jersey corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation, and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors, and said CHRISTIAN F. BEUKEMA acknowledged said instrument to be the free act and deed of said corporation.

/s/ E. J. Prisk

Notary Public

St. Louis County, Minnesota
My Commission Expires Sept. 25, 1964

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OPERATING AGREEMENT

THIS AGREEMENT, made and entered into as of the 1st day of January, 1959, by and between:

PHILIP L. RAY, RALPH BUDD, LOUIS W. HILL, JR., and WILFRID E. RUMBLE, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”;

and

UNITED STATES STEEL CORPORATION, a New Jersey corporation,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH:

WHEREAS, the Lessors have contemporaneously herewith executed and delivered to the Lessee a mining lease of all those certain tracts or parcels of land (hereinafter referred to as the “demised premises”) situated and being in the County of St. Louis and State of Minnesota described as follows, to-wit:

The Southeast quarter of the Northeast quarter (SE¼ of NE¼), the East half of the Southwest quarter (E½ of SW¼), and the Southwest quarter of the Southeast quarter (SW¼ of SE¼) of Section Two (2); the Southwest quarter of the Northeast quarter (SW¼ of NE¼); and the Southeast quarter of the Northwest quarter (SE¼ of NW¼) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

The Southeast quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6),

Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government survey thereof by Frank D. Howe in 1878; and all the ores and minerals in, under, and upon also Government Lots Two (2), and Three (3), the Southeast quarter of the Northwest quarter (SE¼ of NW¼), and the West half of the Southwest quarter (W½ of SW¼) of Section One (1); the Northwest quarter (NW¼), and the Northeast quarter of the Southeast quarter (NE¼ of SE¼) of Section Two (2); the East half of the Northeast quarter (E½ of NE¼) of Section Three (3); the Northeast quarter of the Southwest quarter (NE¼ of SW¼), and the South half of the Southwest quarter (S½ of SW¼) of Section Five (5); the Southeast quarter of the Northeast quarter (SE¼ of NE¼) of Section Seven (7); the North half of the Northeast quarter (N½ of NE¼), the Southeast quarter of the Northeast quarter (SE¼ of NE¼), the Northeast quarter of the Northwest quarter (NE¼ of NW¼), the Southwest quarter of the Northwest quarter (SW¼ of NW¼), the North half of the Southwest quarter (N½ of SW¼), and the Southeast quarter (SE¼) of Section Eight (8); the Southwest quarter of the Northwest quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest quarter of the Northeast quarter (NW¼ of NE¼) and the Northeast quarter of the Northwest quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; and all the ores and minerals in, under, and upon also the North half of the Southwest quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; together with all of the mining and other privileges, rights, interests, and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine, and remove said ores and minerals); all as such ores and minerals, privileges, rights, interests, and estates were excepted and reserved in prior deeds of record; and together with any and all right, title, and interest that the Lessors may hereafter acquire in or with respect to said lands.

Subject, however, to any and all public highways, railroad rights of way, and electric transmission or telephone lines upon the demised premises, and to any and all other rights and privileges listed in a schedule attached hereto, marked “Exhibit A”, and made a part hereof.

NOW, THEREFORE, in consideration of the premises and of the making of said mining lease and of the mutual agreements hereinafter stated, the parties hereto hereby agree unto and with each other as follows:

Section 1 - Purpose

The demised premises are by said mining lease demised for the purpose of granting to the Lessee the exclusive rights and privileges (subject to mining leases heretofore granted) to

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explore for, mine, remove, beneficiate, and dispose of, for its own account, all the iron formation materials in the demised premises, together with the rights and privileges, insofar as the Lessors may have and may lawfully grant, to cave the surface of the said lands, to make any or all use of the said lands and thereon or therein to place, erect, construct, maintain, and use all such buildings, plants, structures, railroads, roadways, pipe lines, equipment, and facilities, and to make all such excavations, openings, ditches, drains, improvements, and changes, all as the Lessee will deem necessary or useful for any of the purposes aforesaid or for any subsidiary purposes connected therewith.

Section 2 - Lessors’ Covenants of Title

The Lessors, in their capacities only as trustees as aforesaid and not in their respective individual capacities and with intention to bind the aforesaid trust estate of which they are trustees and not to bind themselves personally, hereby covenant unto and with the Lessee that they are lawfully seized in fee simple of the demised premises and that the demised premises are free from all encumbrances except as aforesaid; that the Lessors have good right to lease the same in the manner and form aforesaid; and that the Lessee, its successors or assigns, keeping, performing, and observing each of the agreements and conditions to be kept, performed, and observed by it as herein provided or referred to, the Lessors, their successors and assigns, shall warrant and defend the Lessee, its successors and assigns, in the quiet and peaceable possession of the demised premises, subject to the matters above stated or referred to, for the uses and purposes herein provided or referred to, during the continuance of the lease, against all persons lawfully claiming or to claim the whole or any part thereof.

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Section 3 - Definitions

Wherever used in this Operating Agreement, the following terms and words shall be understood to mean as follows:

The term “merchantable ore” shall be taken to mean all iron formation materials that in their respective natural state without beneficiation of any kind other than crushing or dry screening or both and the elimination of rejects, can be mined, shipped and sold by the Lessee on the market at a reasonable profit, after taking into consideration all direct and indirect costs of the Lessee with respect to such ore, in the year with respect to which the question of merchantability arises.

The term “non-merchantable ore” shall be taken to mean all iron formation materials that in their respective natural state will not be included within the definition of merchantable ore as stated above.

The term “ore” when used alone shall be taken to mean merchantable ore and non-merchantable ore as stated above.

The term “merchantable concentrate” shall be taken to mean the merchantable product resulting from the beneficiation of non-merchantable ore and not the residue nor any tailings (whether fine tailings or coarse tailings) resulting therefrom.

The term “taconite ore” shall be taken to mean all non-merchantable ore in which the iron oxide is so finely disseminated that substantially all of the iron-bearing particles of merchantable grade are smaller than 20 mesh and from which, in accordance with good engineering and metallurgical practice, a merchantable concentrate cannot be made without involving treatment by fine grinding, magnetic separation, flotation, or some other method or methods other than or in addition to one or more of the following methods: crushing, screening, straight washing, jigging, heavy media separation, spirals, cyclones, roasting, drying through the use of fuel, sintering, or agglomerating.

The terms “ship”, “shipped”, and “shipment” shall each be taken to mean (1) when used with reference to merchantable ore, the removal of such ore from the demised premises for any purpose other than stockpiling; (2) when used with reference to taconite ore, the removal of such ore from the demised premises for any purpose other than stockpiling; (3) when used with reference to non-merchantable ore other than taconite ore, the removal of such ore from the demised premises for any purpose other than stockpiling or beneficiation; (4) when used with reference to merchantable concentrates produced from non-merchantable ore other than taconite ore, the removal of such merchantable concentrates from the place of beneficiation for any purpose other than stockpiling; and (5) when used with reference to any ore or merchantable concentrates produced from non-merchantable ore other than taconite ore, stockpiled pursuant to the provisions of this Operating Agreement, the removal thereof from the premises upon which stockpiled for any purpose other than restockpiling in accordance with the provisions of this Operating Agreement or other than beneficiation in the case of non-merchantable ore other than

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taconite. For the purpose of computing and accounting for royalty, the time of each shipment, in all cases, shall more particularly be the day when such ores or merchantable concentrates will be weighed, as hereinafter provided, in the course of each shipment. Wasting of non-merchantable ore as authorized by Section 4 hereof shall be excluded as within the above definition.

The word “ton” shall be taken to mean a gross ton of two thousand two hundred forty (2,240) pounds avoirdupois.

Section 4 - Manner of Mining - Waste

The mining of the ore and all the work and operations hereunder by or under the Lessee shall be conducted and carried on in such manner only as is usual and customary in skillful and proper mining operations of similar character elsewhere conducted in the Lake Superior District, and in accordance with the requirements of good engineering, and so as not to do, cause, or permit, except as may be reasonably necessary in the skillful and proper mining out of such ore, any unusual permanent waste or injury to the demised premises so as to interfere with the subsequent operations thereof for mining purposes.

All merchantable ore, when encountered in mineable quantities, shall be mined clean as the mining progresses, allowing only for such waste thereof as necessarily occurs in skillful and proper mining operations of similar character elsewhere conducted in the Lake Superior District.

The Lessee may waste such non-merchantable ore from the demised premises that, at the time of wasting thereof, (a) cannot economically be beneficiated into a merchantable concentrate and (b) has no probability of becoming susceptible to such beneficiation. “Wasting” shall be understood to include, but not be limited to, the mixing of such non-merchantable ore with similar non-merchantable ore from other lands or with non-iron formation materials, and the use or sale or other disposition of such non-merchantable ore for other than metallurgical purposes, such as road building materials, ballast, fill or similar purposes. The removal of such non-merchantable ore from the demised premises and the wasting thereof shall not cause royalty to

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accrue thereon. If the Lessors will serve written notice upon the Lessee objecting to any specific practice of wasting non-merchantable ore, the Lessee shall immediately cease the practice objected to until such time that the Lessors concur, or that it be established by arbitration as hereinafter provided, that such specific practice did involve only non-merchantable ore authorized to be wasted by the foregoing provision.

It is understood that the Lessee shall be under no duty or obligation, either expressed or implied, to open up or develop or to continue to operate any mine or mines in the demised premises. Nothing herein contained shall require the Lessee to develop a separate shaft or shafts in the demised premises nor prevent the Lessee from developing any mine or operations in the demised premises solely through or in connection with Lessee’s operations on or in any adjoining or nearby property or properties.

Section 5 - Placing of Stockpiles and Waste Dumps on Demised Premises

Ores and waste materials encountered by the Lessee in its operations hereunder may be deposited upon the demised premises on areas approved in advance by the Lessors and in such manner only as not unreasonably to interfere with the future operation of any mine or mines thereon, provided such future operations will be conducted in accordance with mining practice that was usual and customary at the time such ores or waste materials were deposited upon the demised premises.

Section 6 - Right to Beneficiate - Accrual of Royalty

The Lessee shall have the right and privilege, but shall not be required, to beneficiate for the purpose of improving its character or quality any or all non-merchantable ores. Non-merchantable ores may be beneficiated by crushing, screening, washing, jigging, heavy media separation, spirals, cyclones, roasting, flotation, magnetic separation, or other processes that may

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be developed, by drying by the use of fuel or otherwise, or by agglomerating by roasting, sintering, or any other suitable means, or by any combination thereof, so as to make a merchantable concentrate. Such beneficiation shall be done with suitable and proper machinery and appliances and in a careful, good and workmanlike manner, according to good engineering practices and so as not to cause any greater waste of such non-merchantable ore than is necessary in order to produce a merchantable concentrate. All non-merchantable ore mined and removed from the demised premises to a concentrating plant for the purpose of beneficiation, shall be beneficiated, and the merchantable concentrates from non-merchantable ore other than taconite ore shall be shipped, within the time or times hereinafter provided.

Royalty shall accrue upon taconite ore when such ore will be shipped to the concentrating plant for beneficiation. Royalty shall accrue upon non-merchantable ore other than taconite ore when the merchantable concentrates produced therefrom will be shipped, whereupon the royalty, at the rate hereinafter provided, shall accrue upon the weight of the merchantable concentrates and not upon such non-merchantable ore as mined nor upon the tailings nor any residue of such beneficiation.

Section 7 - Residue

The tailings or residue material remaining after the beneficiation of taconite ore mined from the demised premises shall belong to the Lessee, excepting such tailings or residue material that will have been placed upon the demised premises and will remain thereon after the termination of the lease.

The tailings or residue material remaining after the beneficiation of non-merchantable ore other than taconite ore mined from the demised premises shall belong to the Lessors, subject to the rights of the Lessee hereunder, and may be kept separate or, subject to the provisions of the

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fifth paragraph of this section, may be commingled with similar material produced from beneficiation of non-merchantable ore mined from other lands. The Lessors’ proportionate interests in any such commingled tailings or residue material shall be the ratio of the iron units contributed by the demised premises to the total of iron units in the commingled tailings or residue material contributed by all sources; and the Lessee shall make such determinations of weights and analyses, and shall keep and make available to the Lessors such records and data, as will be reasonably necessary to indicate such proportionate interests of the Lessors in such commingled tailings or residue material.

During the continuance of the lease, the Lessee may beneficiate all tailings or residue material remaining after the beneficiation by the Lessee of non-merchantable ore other than taconite ore mined from, or allocated to, the demised premises, and ship the product of such beneficiation, paying royalty thereon at the respective rates herein provided for Class B ore or Class C ore, depending upon the quality and characteristics of the tailings or residue material, as such, so beneficiated.

If any tailings or residue material belonging to the Lessors, or any such commingled tailings or residue material, will be deposited on lands not owned by the Lessors, the Lessee shall first grant or secure from the owner thereof a written agreement properly recognizing, protecting, and preserving the interests and rights of the Lessors in all such tailings or residue material. Such written agreement shall be one that is satisfactory to the Lessors, but the Lessors shall not unreasonably withhold their approval.

Before the Lessee beneficiates any non-merchantable ore other than taconite ore from the demised premises and commingles the tailings or residue materials therefrom, the parties hereto will enter into a further commingling agreement establishing, in more detail, appropriate

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methods and procedures with respect to accounting for, and the preservation and protection of, the respective rights and interests of all parties having any rights and interests in any such commingled tailings or residue material. Such commingling agreement shall be one that is satisfactory to the Lessors, but the Lessors shall not unreasonably delay the consummation thereof, demand that any unreasonable terms or conditions be contained in said agreement nor demand that any of the terms or conditions of the lease or of this Operating Agreement be changed as a condition precedent or subsequent to the execution by the Lessors of such agreement.

Section 8 - Ores and Merchantable Concentrates From Demised Premises to Be Kept Separate

Except as herein otherwise expressly provided, all ores mined from the demised premises shall be kept separate and apart from ores mined from other lands until after the merchantable ore or taconite ore or the merchantable concentrates from non-merchantable ore other than taconite ore from the demised premises will have been weighed respectively, as herein provided, for the determination of the amounts of royalty due the Lessors.

Section 9 - Mixing of Ores and Merchantable Concentrates

The Lessee shall have the right and privilege at any time, and so long as it may hold similar rights and privileges on or in connection with any other property or properties at the time owned or controlled by the Lessee, of mixing (1) in stockpile or at the commencement of shipment, merchantable ore mined from the demised premises with merchantable ore of similar character and quality mined from any such other property; (2) in stockpile or at the commencement of shipment or, prior to the time of weighing as required by Section 15 hereof, during the beneficiation process, taconite ore mined from the demised premises with taconite ore of similar character and quality mined from any such other property; (3) in stockpile or at any

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stage in the beneficiation process, non-merchantable ore other than taconite ore mined from the demised premises with non-merchantable ore of similar character and quality mined from any such other property; and (4) in stockpile or at the commencement of shipment, merchantable concentrates produced from non-merchantable ore other than taconite ore mined from the demised premises with merchantable concentrates of similar character and quality produced from non-merchantable ore mined from any such other property; PROVIDED, however, that whenever the Lessee will do any such mixing, it shall keep accurate separate accounts and records of the respective quantities of ores or merchantable concentrates mined or derived from the demised premises and from such other property contributed to each such mixture, either by weighing the same or by use of uniform size cars, trucks, or other containers or measure uniformly filled.

Of each such mixture of merchantable ores or of taconite ores or of merchantable concentrates, or of the total merchantable concentrates produced from the beneficiation of each such mixture of non-merchantable ores other than taconite ores, that proportion thereof shall, in the absence of fraud, be conclusively deemed to have been derived from the demised premises that will bear the same relation to the total of such mixture as the quantity, determined as in this section hereinbefore provided, of the ores or merchantable concentrates from the demised premises contributed to such mixture will bear to the total quantity, similarly determined, of the ores or merchantable concentrates from all properties contributed to such mixture. The actual weights, as hereinafter provided in Section 15, of each shipment of or from any such mixture of merchantable ores or of taconite ores or of merchantable concentrates, or of merchantable concentrates produced from the beneficiation of any such mixture of non-merchantable ores

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other than taconite ores, shall be apportioned to the respective properties contributing thereto in accordance with the provisions set forth above.

Each stockpile of such mixed ores or merchantable concentrates and the actual weights, as hereinafter provided, of each shipment therefrom shall be apportioned in the same manner and accredited to each of the respective properties contributing thereto. If contributions have been made to any stockpile during more than one stockpile year, shipments made after the first such year shall be computed on a stockpile year basis, July 1 to June 30, and shall be deemed to have come from the earliest year’s contributions until a tonnage equal to the total estimated contributions to such stockpile during such earliest year will have been shipped, so that all shipments made from stockpile shall be deemed to be from the oldest ore or merchantable concentrates (in terms of stockpile years) in said stockpile. The basis of apportionment of any so-called “overrun” or “underrun” of any such stockpile shall be the quantity of ore or merchantable concentrates, as determined in the manner set forth above, contributed thereto by each property since the last previous cleanup of such stockpile.

Section 10 – Royalty

The Lessee agrees to pay royalty to the Lessors on or before the 20th days of April, July, October, and January (hereinafter referred to as “quarter days”) in each year during the term of the lease or until the lease will be sooner terminated, at the rate or rates hereinafter provided, in effect at the time of shipment, for all merchantable ore, taconite ore, and merchantable concentrates produced from non-merchantable ore other than taconite ore, derived from the demised premises, that will have been shipped by the Lessee during the three (3) months preceding the first day of the month in which such payment will be made.

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The rates of royalty per ton (plus the additional amount, if any, as provided hereafter in this Section 10) shall be respectively as follows:

Class A Ore: On Class A ore the rate of royalty per ton shall be   *** .

Class A ore shall be understood to mean all merchantable ore.

Class B Ore: On Class B ore the rate of royalty per ton shall be   *** .

Class B ore shall be understood to mean all merchantable concentrates produced from non-merchantable ore other than taconite ore.

Class C Ore: On Class C ore the rate of royalty per ton shall be   ***   plus the product resulting from multiplying   ***  , hereinafter referred to as the “reference rate”, by the per cent of weight recovery of taconite ore as defined in Section 10 (b) hereof.

Class C ore shall be understood to mean all taconite ore.

On any non-merchantable ore shipped to market direct without beneficiation of any kind and on any non-merchantable ore, after crushing or dry screening or both, shipped to market in all its fractional parts without further beneficiation of any kind to all or any fractional part thereof, the royalty rate per ton shall be at the rate provided for Class A ore; and any such non-merchantable ore shall be accounted for within the meaning of the several provisions of this lease as “merchantable ore” shipped.

If the current market value (as such term is defined in Section 10 (a) hereof) at Lake Erie ports of standard grade Mesabi Range Bessemer iron ore analyzing 51.50 per cent iron, natural analysis, will exceed   ***   per gross ton, said royalty rates for Class A ore and Class B ore and said reference rate for Class C ore, respectively, shall be increased by   ***   of such excess value.

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Section 10 (a) - Determination of Current Market Value at Lake Erie Ports of Mesabi Range Bessemer Ore

The current market value at Lake Erie ports of standard grade Mesabi Range Bessemer iron ore analyzing 51.50 per cent natural iron, referred to in Section 10 hereof, shall be determined as of the time of shipment of the particular ore or merchantable concentrates with respect to which royalty will be from time to time payable hereunder, and shall be understood to mean the then currently published price of such standard grade ore delivered at rail of vessel at Lake Erie ports, as published in IronAge or other recognized trade paper.

In the event that there will be no such published price of said standard grade Mesabi Range Bessemer iron ore analyzing 51.50 per cent iron, natural analysis, then such current market value thereof at Lake Erie ports shall be fixed by mutual agreement between the Lessee and the Lessors, or in the event they are unable to reach an agreement as to such current market value, then by arbitration as provided in Section 28 hereof.

Section 10 (b) - Determination of Weight Recovery Factor

For computing the amount of royalty due on Class C ore, the factor of the per cent of weight recovery of taconite ore (hereinafter called “recovery factor”) shall be the quotient resulting from dividing the quantity of merchantable concentrates produced by the Lessee from a beneficiation plant by the quantity of taconite ore from all property sources processed therein to produce such quantity of such concentrates. The recovery factor shall be determined for each calendar year separately for each beneficiation plant, and each recovery factor shall be used, as hereinafter in this Section provided, in accounting for the royalty on the quantity of taconite ore from the demised premises entering the respective beneficiation plant.

For the purpose of determining the recovery factor, the quantities of taconite ore from all property sources entering a beneficiation plant and the quantities of merchantable concentrates

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produced therefrom and shipped directly from the beneficiation plant or placed into stockpile shall be weighed in a manner authorized by Section 15 hereof. Each recovery factor shall be determined to the nearest one-thousandth of one per cent.

It is agreed that the quantity of merchantable concentrates to be taken into account in determining the recovery factor shall be the weight of concentrates from taconite ore in the form of agglomerates produced by one of the processes now commonly known as pelletizing, nodulizing, or sintering and by using additives only for agglomeration binding purposes. If the Lessee elects, as it may, (a) not to agglomerate as a continuous process any or all of the product of concentration (i.e. the product resulting from beneficiation to the point of completion of reject elimination other than that to occur during the agglomeration process), or (b) to make from such product of concentration a special agglomerate by using additives other than as required for agglomeration binding (such as self-fluxing agglomerates), or (c) to make from such product of concentration an agglomerate by a process other than pelletizing, nodulizing, or sintering (such as blocking or briquetting) or (d) to submit directly such product of concentration to a reduction process, then in any such event the quantity of such product of concentration, either shipped directly from the beneficiation plant or placed into stockpile or so made into such special agglomerate or so made into an agglomerate by a process other than pelletizing, nodulizing, or sintering, or submitted to direct reduction processing, shall be appropriately adjusted to account for the loss of weight, by reason of the difference in moisture content, to be expected if such product of concentration were to be agglomerated by pelletizing, nodulizing, or sintering. Such adjustment shall be made by computing the weight of such product of concentration upon elimination of all moisture above 2% natural moisture. For such weight conversion purposes, the Lessee shall take such samplings of such product of concentration as will be sufficient in number

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and timeliness to produce, in accordance with good engineering practice, a true representation of the moisture content of such product of concentration and shall weigh such product of concentration in a manner authorized by Section 15 hereof.

Royalty on all Class C ore from the demised premises entering a beneficiation plant during each calendar year shall be computed by using the recovery factor experienced in the beneficiation plant during the last preceding full calendar year of plant operation, or if it is the first year of plant operation, by using the recovery factor of .31500. Beneficiation plant operation for 180, or more, days in a calendar year shall constitute a “full calendar year of plant operation”.

Section 11 - Minimum Royalty

The Lessee covenants and agrees that during the continuance of the lease it shall pay to the Lessors, as rent for the demised premises or as royalty for the Class A ore, Class B ore, and Class C ore shipped as aforesaid, an annual calendar year minimum rental or royalty at the rate of at least   ***   during the period of five (5) years from and after December 31, 1958; and at the rate of at least   ***   during the period of five (5) years from and after December 31, 1963; and at the rate of at least   *** during the period of five (5) years from and after December 31, 1968; and at the rate of at least   ***   during the period of five (5) years from and after December 31, 1973; and at the rate of at least   ***   for each calendar year from and after December 31, 1978.

Upon any termination of the lease, whether by surrender by the Lessee or otherwise, the Lessee shall pay to the Lessors, as such minimum rental or royalty, the minimum amount payable for the year in which such termination will occur if such termination will occur on December 31st of such year, or prorated for the portion of the year that will have expired at the date of termination if such termination will occur prior to December 31st of such year.

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Section 12 - Advance or Prepaid Royalty

Said annual minimum sums shall be paid as aforesaid, whether any ore will have been mined or shipped from the demised premises or in fact exists therein or not, in quarterly installments payable upon each of the quarter days above specified, for the three (3) months preceding the first day of the month in which such payment is to be made, and each sum so paid shall be applied, so far as necessary or so far as it will go, in satisfaction of the royalty payable for the Class A ore, Class B ore, and Class C ore shipped by the Lessee during such quarter year. If the sum paid for any such quarter year will exceed the amount of royalty on the Class A ore, Class B ore, and Class C ore shipped during such quarter year, such excess shall be deemed to be and treated as advance or prepaid royalty, which the Lessee shall be entitled to apply in settlement of the royalty payable, at the rate or rates above provided, on Class A ore, Class B ore, and Class C ore shipped in any subsequent quarter of the same or any subsequent year in excess of one-fourth (1/4) of the agreed minimum payment to be made for that year, until by such application or applications such advance or prepaid royalty will be exhausted; but in no event shall the Lessors be liable to refund such advance or prepaid royalty. Any royalty actually paid upon Class A ore, Class B ore, and Class C ore shipped in any quarter year in excess of one-fourth (1/4) of the agreed minimum payment to be made for that year shall be in discharge insofar as such excess royalty will go, of the obligation to pay rent for any subsequent quarter or quarters of the same calendar year.

Section 13 - Payment of Royalty by Application of Lessee’s Surface Acquisition Costs

It is understood that the Lessee has acquired surface ownerships of several of the lands hereinbefore described in which the Lessors own only the mineral estates leased to Lessee, and that the Lessee intends, but is not hereby obligated, to acquire the surface ownerships of the

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remainder of said lands. It is agreed, in accordance with the provisions of this Section 13, that the Lessee shall apply its past and future costs, as herein defined, of acquiring such surface ownerships in satisfaction of the royalties to become due under this Operating Agreement for Class A ore, Class B ore, and Class C ore shipped by the Lessee, and that such surface ownerships shall then be conveyed by the Lessee to the Lessors.

The Lessee has concurrently herewith furnished the Lessors with a statement of such surface ownerships the Lessee has acquired to date, listing the surface ownerships in sequence of date of acquisition and stating after each surface ownership the respective acquisition costs. If undivided interests in any such surface ownerships were, or will be, acquired upon different dates, the acquisition of such surface ownerships were or shall be deemed complete upon the date of acquisition of the last remaining undivided interest therein outstanding in third parties.

The Lessee shall obtain the concurrence of the Lessors to the terms of each transaction before acquiring the surface ownerships of the remainder of said lands. Such surface ownerships shall be added to the aforesaid statement in sequence of their respective dates of acquisition.

The acquisition cost to be allowed as a credit upon royalties as herein provided shall be limited to the purchase price, realtors’ fees, appraisers’ fees, abstract of title costs, attorneys’ fees and legal expenses in connection with title examination or procurement of new certificates of title, recording fees, and similar out-of-pocket items (excluding salaries of Lessee’s employees) paid by the Lessee for, or in connection with, such acquisitions, and the ad valorem taxes paid by the Lessee in 1959 and prior years upon such surface ownerships acquired by it prior to January 1, 1959. If the purchase price will be, in total or in part, an exchange of land owned by the Lessee, the value of such exchange land shall be the Lessee’s acquisition cost thereof, as herein defined (excepting ad valorem taxes paid thereon), plus any platting and improvement

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costs paid by the Lessee and allocable thereto. There shall be deducted, from time to time, from the respective acquisition costs any amount actually realized by Lessee in reduction of Federal and Minnesota income taxes payable by it by reason of the taking of allowable depreciation or casualty loss upon any buildings acquired as a part of the acquisition of said surface ownerships and any net amount, after taxes, actually realized by the Lessee upon the sale of such buildings.

At such time or times during the continuance of the lease when the royalty payable for Class A ore, Class B ore, and Class C ore shipped by the Lessee during a quarter year will exceed the agreed minimum payment to be made for that quarter year and there will then be no, or insufficient, advance or prepaid royalty previously paid to the Lessors under Section 11 hereof to be applied in settlement of such excess royalty, the Lessee shall apply said acquisition costs in settlement of such excess royalty then payable, until by such application or applications such acquisition costs will thereby be exhausted; provided, however, that only one-half (1/2) of such excess royalty payable on any such quarter day will be thus settled and that any excess royalty thus settled shall not affect the amount of minimum royalty required to be paid by Sections 11 and 12 hereof in any subsequent quarter or quarters of the same calendar year.

When and as the application or applications of such acquisition costs in settlement of excess royalty will equal in amount the several acquisition costs of each of such surface ownerships, taking the same in sequence according to the date of respective acquisition, the Lessee shall, from time to time, convey that respective surface ownership to the Lessors, or their nominee, by warranty deed, reserving therein a leasehold interest for the remaining term of the lease and subject to all and singular the terms and conditions of the lease and this Operating Agreement. After each of such conveyances, the surface lands so conveyed shall be deemed a

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part of the lease and included herein under the references to the “demised premises”, except as otherwise herein specifically provided.

If, upon the termination of the lease for any reason, there will then have been such an application or applications of acquisition costs in an amount less than the respective acquisition costs of the surface ownership next in sequence on said list, then the Lessors shall pay to the Lessee such balance of the respective acquisition costs of such surface ownership, and the Lessee shall convey the same, by warranty deed, to the Lessors, or their nominee. All other surface ownerships as to which there will have been no application of their respective acquisition costs in settlement of excess royalty shall remain the property of the Lessee free and clear of any rights or interests therein of the Lessors.

Until such conveyances of said surface ownerships by the Lessee to the Lessors, the Lessee may make such use of said surface lands as it could make if said surface lands were a part of the demised premises under the lease and this Operating Agreement from the date hereof, and the Lessee agrees to pay the taxes levied thereon and to protect the titles thereto, all in accordance with the provisions of this Operating Agreement applicable to the demised premises.

Section 14 - Place of Payment of Royalty

The several payments of royalty herein required to be made to the Lessors shall be made in lawful money of the United States of America or by checks delivered in the usual course of business to the Lessors at such address, or at and to such bank, as the Lessors may from time to time designate by written notice to the Lessee. Any bank or banks so designated shall be deemed the agent of the Lessors for the purpose of receiving, collecting, and receipting for such payments.

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Section 15 – Weights

The Lessee shall cause all Class A ores, Class B ores, and Class C ores derived from the demised premises and shipped by it to be weighed by the railroad company transporting the same, upon its regular scales, or by the Lessee upon platform scales or a belt weighing device or other weighing device in practical use now or hereafter in connection with mining or beneficiation operations, that may be installed by the Lessee either upon the demised premises or upon other land conveniently located at or near a place of beneficiation or of stockpiling. The Lessors and the Lessee shall each have the right to inspect, review, and test the correctness of said railroad company’s scales and weights, and of the other scales or weighing devices installed by the Lessee and the weights shown thereby, and the manner and method of weighing, at any time and in such manner as they may respectively see fit to adopt, it being understood that any errors in these respects, when ascertained, shall be promptly recognized and corrected.

The weighing of Class C ore may be postponed to an intermediate stage in the beneficiation process, but in any event to be done prior to the elimination in the beneficiation process of any waste material therefrom. If, prior to weighing, Class C ore derived from the demised premises will be mixed in the beneficiation plant with taconite ore from other properties, as authorized by Section 9 hereof, the actual weights of the mixed ores entering the beneficiation plant during each shift of plant operation shall be apportioned to the respective properties contributing thereto in accordance with the provisions of Section 9 hereof.

Section 16 - Monthly Reports

The Lessee shall furnish to the Lessors on or before the 20th day of each calendar month a detailed report stating separately the respective quantities of Class A ore, Class B ore, and Class C ore derived from the demised premises that will have been shipped by the Lessee during

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the preceding calendar month. Such monthly report for the third month of each calendar quarter year may be combined as part of the quarterly report required by Section 17.

The Lessee shall also furnish to the Lessors on or before the 20th day of each calendar month a report concerning ores and merchantable concentrates from the demised premises showing for the preceding calendar month the following, to-wit: (1) the analyses and estimated or actual quantities of all non-merchantable ore other than taconite ore removed directly from the demised premises or from stockpile that entered a beneficiation plant (separated as to respective quantities thereof for each beneficiation plant and for each source of said ore); (2) the analyses and estimated quantities of all non-merchantable ore placed in stockpile and not beneficiated during said month (separated as to the respective quantities thereof for each stockpile); (3) the estimated quantities of all merchantable ore placed in stockpile and not shipped therefrom during said month (separated as to the respective quantities thereof for each stockpile); (4) the analyses and estimated or actual quantities of merchantable concentrates derived from non-merchantable ore other than taconite ore placed into stockpile and not shipped therefrom during said month (separated as to the respective quantities thereof for each stockpile); (5) the analyses and quantities of any tailings or residue materials resulting from the beneficiation of non-merchantable ore other than taconite ore (separated as to the respective quantities thereof for each place of disposal); and (6) the analyses and estimated or actual quantities of non-merchantable ore wasted under the provisions of Section 4 hereof.

The monthly reports herein specified shall be required of the Lessee only as to such items, if any, active during each calendar month.

In the event that any ores or merchantable concentrates from the demised premises will be mixed with ores or merchantable concentrates from other properties, in accordance with the

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provisions hereinbefore contained, such monthly reports shall reasonably disclose all relevant facts in connection with such mixtures and the determinations and allocations based thereon.

Statements of weights shown by railroad scales shall be certified by an officer or agent of the railroad company. Statements of weights shown by the scales or other weighing device installed by the Lessee, or quantities determined by other methods hereinbefore provided for, shall be certified by a representative of the Lessee having knowledge of the facts, and if such scales or weighing device automatically print such weights in duplicate, the Lessee shall send one of each such duplicate weight slips to such representative as the Lessors may designate as its agent to receive such weight slips.

Section 17 - Quarterly Reports

At the time of making each quarterly payment of royalty, the Lessee shall furnish to the Lessors: (1) An exact statement that will show separately the respective quantities of Class A ore, Class B ore, and Class C ore shipped by the Lessee during the preceding quarter and on which royalty is payable; (2) a statement of the then applicable current market value of standard grade Mesabi Range Bessemer iron ore analyzing 51.50 per cent iron, natural analysis, as determined in accordance with the provisions of Section 10 (a) hereof; and (3) in the case of royalty then being payable for Class C ore, a statement of the recovery factor or factors being used in the computation of such royalty, as determined and authorized in accordance with the provisions of Section 10 (b) hereof.

Section 18 - Other Information to Be Furnished by Lessee  

On or before the first day of March in each year during the continuance of the lease, the Lessee shall furnish to the Lessors, upon request, copies of the Lessee’s annual open pit and

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underground maps and cross sections of the demised premises as of the first day of January of such year.

At reasonable intervals, the Lessee shall furnish to the Lessors at their request: (1) Such information concerning the ores mined from the demised premises or remaining therein as the Lessors may reasonably request and as the Lessee customarily obtains for its own records, and (2) such reports or statements with respect to any beneficiation operations conducted by the Lessee as the Lessors may reasonably request and as will be reasonably necessary to protect the Lessors’ interest in non-merchantable ore from the demised premises beneficiated or to be beneficiated thereby.

Section 19 - Use of Demised Premises for Cross-Mining

The Lessee is hereby granted the rights and privileges, to the extent that the Lessors may lawfully grant the same, during the continuance of the lease to use the demised premises (including the surface thereof) for any purpose auxiliary to the carrying on of any mining operations either in the demised premises or in any other lands and for the enjoyment of such other cross-mining rights and privileges as may be necessary or convenient from time to time in the conduct of any such mining operations; provided, that such use by the Lessee of the demised premises shall not unreasonably interfere with the future operation of any mine or mines therein. Without limiting the generality of the foregoing, it is understood that (1) any and all ores and waste materials from other lands may be mined, removed, and hoisted over or across the demised premises or through a shaft, incline, openings, or pits in or upon the demised premises, by any means whatsoever; (2) the Lessee may construct and use in and upon the demised premises all such roads, railroad tracks, plants, structures, buildings, power lines, pipe lines, and other facilities and improvements and make all such excavations, pits, shafts, and openings therein as

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may be necessary or convenient for use in the conduct of any such mining operations; (3) merchantable ores and merchantable concentrates from other lands may be stockpiled upon the demised premises, provided, that the same shall be removed from the demised premises on or before the termination in any manner of the lease, the Lessors hereby agreeing to recognize the rights and interests of the owners of such other lands in and to any such merchantable ores and merchantable concentrates mined therefrom and stockpiled upon the demised premises; and (4) non-merchantable ores and waste materials from other lands may be stockpiled or wasted upon the demised premises, provided, that the lessee shall notify the Lessors of the proposed location of any such stockpile grounds and waste dumps and shall furnish the Lessors with the Lessee’s best information as to the ores and minerals, if any, underlying such proposed location, and if the Lessors will reasonably believe that stockpiling or depositing materials on such proposed location will unreasonably interfere with subsequent mining operations in the demised premises, the Lessors and Lessee shall agree on an alternative location if available and in the absence of such agreement shall submit the matter to arbitration as hereinafter provided.

Section 20 - Use of Other Lands for Cross-Mining

The Lessee may mine, remove, and hoist any and all ores and waste materials from the demised premises over or across other lands or through a shaft, incline, openings, or pits in or upon other lands, by any means whatsoever, and may stockpile any ores or merchantable concentrates from the demised premises upon stockpile grounds situated upon other lands. Except as herein otherwise provided, all such ores and merchantable concentrates from the demised premises so stockpiled upon other lands shall at all times be kept entirely separate and distinct from any ores or merchantable concentrates removed from other lands, until the same will have been shipped and weighed as herein provided. The beneficiation of non-merchantable

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ore, as herein permitted, may be carried on either upon the demised premises or upon other lands, and the product of such beneficiation, at any stage in such process, may be stockpiled on other lands. The respective rights and interests of the Lessors and the Lessee in and to any ores and merchantable concentrates from the demised premises so stockpiled upon other lands shall not be divested by the removal thereof from the demised premises, and unless such other lands are owned by the Lessors, the Lessee shall first secure from the owner or owners of such other lands a written agreement properly recognizing and fully protecting and preserving the rights and interests of the Lessors in and to such ores and merchantable concentrates; provided, that if the Lessee is the owner of such other lands, such written agreement shall be granted by the Lessee upon the termination, in any manner, of the lease as to such ores and merchantable concentrates then in stockpile on such other lands.

It is understood that the removal of any ores or merchantable concentrates from the demised premises to other lands for stockpiling under the provisions of this Section 20 shall not be treated as a shipment thereof so as to require the payment of royalty thereon, but royalty upon such ores and merchantable concentrates so removed and stockpiled upon such other lands shall become due and payable only if and when the same will be shipped from such stockpile.

Section 21 - Ores and Merchantable Concentrates Stockpiled on Other Lands to Be Shipped Upon Termination of Lease

On or before any termination of the lease, if the date of termination will be prior to August first of any year, all merchantable ores and merchantable concentrates from non-merchantable ores other than taconite ore from the demised premises stockpiled upon other lands shall be shipped, and all non-merchantable ores removed from the demised premises to a plant for the purpose of beneficiation shall be beneficiated and shipped, during that calendar year and the royalty thereon shall be paid on the quarter day following such shipment or respective

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shipments. If the date of termination of the lease will be after August first of any year, then all such merchantable ores and such merchantable concentrates shall be shipped, and such non-merchantable ores shall be beneficiated and shipped, during the shipping season in said year or during the shipping season in the following calendar year, and the royalty thereon shall be paid on the quarter day following such shipment or respective shipments.

Section 22 - Lessors’ Right to Enter and Inspect

The Lessors, their agents and employees, shall have the right and privilege at all reasonable times to enter into and upon the demised premises for the purpose of inspecting the demised premises and taking all reasonable means to ascertain the condition thereof and the kind, quality, and quantity of the ores and minerals remaining therein or mined and removed therefrom, and to enter upon any other lands upon which any ores mined from the demised premises, or any merchantable concentrates thereof, will then be stockpiled or to which any such ores will then be removed for beneficiation, for the purpose of inspecting the beneficiation plant and ascertaining the kind, quality, and quantity of ores and merchantable concentrates thereon, or shipped therefrom, not thereby unreasonably or unnecessarily hindering or interrupting any of the operations of the Lessee; and for said purposes the Lessors, their agents, and employees, may enter the demised premises or such other lands through any adjoining or adjacent lands through which the Lessee will have the right to remove such ores.

Section 23 - Taxes - Depletion Agreement

The lessee agrees to pay promptly, before delinquency, all taxes and assessments, general, specific, ordinary, and extraordinary, that may be levied or assessed, during the continuance of the lease, upon the demised premises, the ores and merchantable concentrates mined therefrom, and all improvements and personal property thereon, commencing with the

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taxes for the year 1959 that are payable in 1960, and including the taxes for the year in which the lease may be terminated unless it be terminated prior to May first of any year, in which event the Lessee shall not be required to pay the taxes for that year except the taxes, if any, on or account of any ore or merchantable concentrate or other property that the Lessee will have the right, as herein provided, to remove, either from the demised premises or from other lands, after the termination of the lease, levied during the continuance of such right of removal; provided, however, that the Lessee shall always have the right to contest, in the courts or otherwise, the validity or amount of any such taxes or assessments in case it will deem the same unlawful, unjust, unequal, or excessive, or to take such other steps or proceedings as it may deem necessary to secure a cancellation, reduction, readjustment, or equalization thereof, before it shall be required to pay the same; but the Lessee shall not permit nor suffer the demised premises or said other property, or any part thereof, to be sold or forfeited at any time for any such taxes and assessments. The Lessee shall send a duplicate receipt for all such taxes and assessments, when paid, to the Lessors.

The Lessee shall pay the royalty taxes assessed under the laws of the State of Minnesota, against or on account of the royalty payable to the Lessors under this Operating Agreement and all occupation taxes and any and all other taxes assessed on account of the Lessee’s mining or other operations in or on the demised premises; but the Lessee shall not be required to pay any income or other taxes imposed on the Lessors by reason of the receipt of such royalty.

It is agreed for purposes of the lease and this Operating Agreement and solely for purposes of allocation of taxes under Revenue Ruling 16 or any similar rulings, regulations, or statutory provisions permitting allocation of taxes between lessor and lessee for calculation of percentage depletion for Federal income tax purposes, that the Lessors’ share of ad valorem and

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royalty taxes and any taxes in lieu of ad valorem taxes is limited to the total sum of taxes levied and assessed against the demised premises and paid by the Lessors with respect to the year 1958.

Section 24 - Lessee to Protect Title

The Lessee shall keep the title to the demised premises, all buildings, equipment, improvements and other personal property on the demised premises, and all ore and merchantable concentrates mined or derived from the demised premises and not shipped, free and clear from any and all liens and other encumbrances arising in any manner whatsoever from or on account of the Lessee’s mining operations under the lease.

Section 25 - Lessee to Protect Lessors  

The Lessee shall protect, indemnify, and hold harmless the Lessors from and against any and all claims made by third parties for injury to or death of persons or damage to property arising from or on account of the Lessee’s operations under the lease.

Section 26 - Lessors to Have Lien

The Lessors shall at all times have a lien upon all stockpiled merchantable concentrates from taconite ore derived wholly or partly from the demised premises and upon all movable machinery, equipment, and other personal property of the Lessee on or in the demised premises as security for any unpaid balance of money due hereunder, and as security for the performance by the Lessee of each and all of the covenants and conditions hereof obligatory upon the Lessee, which lien may be enforced against any such merchantable concentrates or such property in like manner as liens conferred by chattel mortgages, or by any other lien security, are or may be entitled to be then enforced under the laws of the State of Minnesota. Nothing herein contained, however, is intended or shall be construed to prevent, at any time when the Lessee will not be in default, the removal, from the demised premises of tools, machinery, equipment, or any other

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property or the shipment of such merchantable concentrates to consumers (including the Lessee); and said lien shall not follow such merchantable concentrates so shipped.

Section 27 - Right to Arbitration  

In the event that any disagreement or controversy will arise between the Lessors and the Lessee as to whether any of the Lessee’s mining practices conform to the standards stipulated herein, or as to any fact that might affect the determination of royalty payable hereunder, or as to any fact relative to the observance or fulfillment of the terms and obligations hereof by either party, or as to any other matter hereinabove stated to be the subject of arbitration, then either party may demand that such disagreement or controversy shall be determined by arbitration in the manner hereinafter provided.

Section 28 - Arbitration Procedure - Appointment of Arbitrators - Hearing - Decision - Expenses - Manner of Giving Notice

If and whenever the Lessee will desire an arbitration, it shall serve a written notice upon the Lessors, stating in substance the matter or question in dispute that it desires to submit to arbitrament and naming a competent person to act as an arbitrator; and if and whenever the Lessors will desire an arbitration, they shall serve upon the Lessee a written notice stating in substance the matter or question in dispute that they desire to submit to arbitrament and naming a competent person to act as an arbitrator. Within twenty (20) days after the mailing of such notice, the Lessors, or the Lessee if such notice be served by the Lessors, shall appoint a competent person to act as an arbitrator, and the two so appointed shall jointly appoint a third arbitrator. In case either the Lessors or the Lessee will fail to appoint an arbitrator and to serve written notice thereof upon the Lessee or the Lessors within said period of twenty (20) days, or in case the arbitrators appointed by the parties will fail to agree upon a third arbitrator within an additional period of ten (10) days, such arbitrator or arbitrators may be appointed by any person

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holding the office of District Judge for the Minnesota Judicial District that includes St. Louis County, Minnesota, upon application made by the Lessee or the Lessors, after ten (10) days’ written notice to the other party. Each of the persons appointed to act as arbitrator shall be a person qualified by experience to hear and determine the matter or question to be arbitrated, and if the nature of such matter or question shall so require, they shall be mining engineers experienced in the mining of iron ore in the Lake Superior District. Said arbitrators, as soon as possible after their appointment, shall meet at a time and place convenient for the parties, after giving to each of the parties not less than ten (10) days’ written notice thereof; and after hearing the parties hereto, or such of them as may desire to be heard, in regard to the matter or question in dispute, taking such evidence and making such other investigations as justice shall require and the arbitrators may deem necessary, they shall decide the matter or question submitted to them, make their decision in writing, and serve a copy thereof upon each party. The decision of the arbitrators, or a majority of them, shall be final, and binding upon the parties hereto, and they shall immediately conform to and in all respects render full and prompt compliance with such decision. The expenses and charges of the arbitrators shall be paid by such party, or apportioned between the parties, as the arbitrators shall determine.

Any such notice to be served upon the Lessee as aforesaid shall be served by mailing such notice by registered mail deposited in any Post Office in the United States, postage prepaid, addressed to the Lessee at the address hereinafter specified; and any such notice to be served upon the Lessors shall be served by mailing such notice by registered mail deposited in any Post Office in the United States, postage prepaid, addressed to the Lessors at the address hereinafter specified.

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Section 29 - Disputes or Differences Not to Interrupt Performance of Operating Agreement

Any such disagreement or controversy shall not interrupt the performance of this Operating Agreement nor the continuation of operations hereunder (except as provided in Section 4 hereof concerning the wasting of non-merchantable ore); but such operations may be continued and settlements and payments may be made hereunder in the same manner as prior to the arising of such disagreement or controversy, until the matters in dispute will be finally determined by arbitration as aforesaid, and thereupon such payments or restitutions shall be made as may be required by the decision of the arbitrators; provided, that if the Lessors will claim that an improper method of mining or beneficiation is then being pursued, in violation of the terms of this Operating Agreement, that is likely to result in great damage or loss before a decision can be reached by the arbitrators, and if such claim will be certified by a reputable independent mining engineer to be well founded, in his opinion, then the method complained of shall be discontinued until the final decision of the arbitrators.

Section 30 - Forfeiture

If any taxes, assessments, rent, or royalty herein agreed to be paid by the Lessee, or any part thereof, will remain unpaid after the times herein specified for the payment thereof (subject to the Lessee’s right to contest the validity or amount of such taxes and assessments or to take steps to secure a cancellation, reduction, readjustment, or equalization thereof as above provided), or if the Lessee will fail to keep, observe, and perform any of the other covenants, agreements, and conditions in this Operating Agreement expressed to be kept and performed by the Lessee, and if such non-payment or other default will continue for sixty (60) days after receipt by the Lessee of written notice from the Lessors specifying the default complained of, then, unless the subject matter of the alleged default will be referred to arbitration as herein provided, the lessors shall have the right, at their election, at any time thereafter while such

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default will continue, to declare the lease terminated and the rights and privileges of the Lessee thereunder forfeited, and thereupon to take possession of the demised premises, or any part thereof in the name of the whole, and without any process whatever to re-enter and re-possess the same, as well as their interest in all unshipped ores and merchantable concentrates, and wholly to exclude from the demised premises the Lessee and all persons claiming under it, and all rights of the Lessee in the demised premises shall thereupon be terminated, subject, however, to the provisions of Section 32 hereof; and any such re-entry on the part of the Lessors shall be without prejudice to any other remedy or proceedings that the Lessors might have in law, equity, or otherwise by reason of any such default of the Lessee, or for the recovery of possession of the demised premises. Provided, however, that if the Lessee will deny the default alleged by the Lessors and will demand arbitration in the manner herein provided, the period required for the hearing and determination of such matter by the arbitrators shall not be deemed a part of said sixty (60) days hereinabove referred to; and if the contention of the Lessors will be sustained by the arbitrators, the Lessee shall have sixty (60) days after the filing of the decision of the arbitrators in which to correct the default so found.

Section 31 - Termination by Lessee

The Lessee shall have the right to terminate the lease at any time by giving to the Lessors at least six (6) months’ written notice by registered mail deposited in any Post Office in the United States, postage prepaid, addressed to the Lessors at the address hereinafter specified. The Lessors shall acknowledge in writing the receipt of such notice; but in any event, the giving of such notice shall be deemed complete upon the day of the mailing of the same as aforesaid, and the lease shall terminate on the date specified in such notice, whether the receipt thereof will be so acknowledged or not. If such date of termination will be after August first of any year, any

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merchantable ores theretofore mined from the demised premises and then in stockpile on the demised premises and any merchantable concentrates from non-merchantable ore other than taconite ore then stockpiled on the demised premises may be shipped, and any non-merchantable ores theretofore mined from the demised premises and then in stockpile on the demised premises for beneficiation thereof may be beneficiated, at any time during the shipping season in said year or during the shipping season in the following calendar year, and the royalty thereon shall be paid on the quarter day following such shipment or respective shipments. On or before the date of such termination the Lessee shall execute and deliver to the Lessors a recordable instrument of termination and surrender of the lease.

Section 32 - Lessee’s Right to Remove Equipment Upon Termination of Lease - Lessee to Surrender Possession

The Lessee shall, have six (6) months after the termination of the lease, or after the shipment of said merchantable ore and merchantable concentrates and the beneficiation of said non-merchantable ores as hereinabove provided, during which to remove all pumps, engines, tools, machinery, rails, railway tracks, shaft headframes, structures of every kind and all other property, of every nature and description, erected or placed by the Lessee in or upon the demised premises, provided all taxes then due and payable and all royalties and other monies due to the Lessors will have been paid and all other conditions, covenants, and agreements obligatory upon the Lessee will have been fully performed; and on failure within said six (6) months to remove such property, all of the same not removed shall either (a) belong to and become the property of the Lessors or their successors in interest or (b) be removed by the Lessors, in which event the cost of such removal shall be charged to the Lessee, and the Lessee agrees to pay said cost. But the Lessee shall not remove nor impair any supports placed in any underground mine in the demised premises or any timber or framework necessary to the use or maintenance of any shaft

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or other approach to such mines or of any tramways therein; and the Lessee shall not remove any fences then existing upon the demised premises. Upon termination of the lease, the Lessee, if it will not already have done so, shall erect any fence then required to be erected in accordance with the statutes of the State of Minnesota, or any regulation or order made pursuant thereto; and the Lessee shall not leave the demised premises, as the result of its operations or business, in such condition as to constitute a continuing menace to the lateral support of adjacent property that is not a part of the demised premises.

On or before the expiration of said period of six (6) months, the Lessee shall quietly and peaceably surrender possession of the demised premises to the Lessors or their successors in interest.

Section 33 – Addresses

For the purposes hereof, the address of the Lessors shall be:

Great Northern Iron Ore Properties

Office of the Trustees

W-1481 First National Bank Building

St. Paul 1, Minnesota,

or such other place as the Lessors will have last designated in writing to the Lessee; and the address of the Lessee shall be:

Wolvin Building

Duluth 2, Minnesota,

or such other place as the Lessee will have last designated in writing to the Lessors.

Section 34 - Mailing of Payments, Reports, and Notices

Payments by check and routine or regular periodical reports and statements hereunder may be sent by regular mail so addressed; and if so addressed and mailed in due season, then if any of the same will not be received when due, the addressee shall notify the addressor of such

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failure of receipt and give the addressor a reasonable time to follow up and secure the delivery of the payment, report, or statement, or to send a duplicate thereof, before claiming any default on account of such failure of delivery. But as to any formal notices of cancellation, default, or termination, or as otherwise provided herein, the same shall be delivered to the party notified either personally or by registered mail to be effective hereunder.

Section 35 - Assignment or Sublease

The Lessee shall have the right to assign the lease together with this Operating Agreement, to contract with others to mine and beneficiate the ores from the demised premises, and to sublease the same for all the purposes of the lease and with the same rights and privileges as are herein granted to the Lessee; provided, that any such assignment, contract, or sublease shall not operate as a release or discharge of the Lessee from the performance of its obligations under the lease and this Operating Agreement until and unless the Lessors will in writing consent thereto.

The Lessors may assign their rights and obligations under the lease and this Operating Agreement to any person or corporation without the consent of the Lessee. In the event of such assignment, or of the termination of the Great Northern Iron Ore Properties Trust, resulting, or thereafter resulting, in the ownership of the Lessors’ rights and obligations under the lease and this Operating Agreement by more than one person or corporation, then the provisions of Section 30, pertaining to “Forfeiture”, shall be deemed amended so as to require that the written notice of default referred to therein must be such notice from the owners of undivided interests then aggregating at least seventy-five per cent (75%) of the entire ownership of the Lessors’ rights and obligations under the lease and this Operating Agreement.

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Section 36 - Lease Runs With the Land and Binds Assignees

All of the covenants, conditions, and provisions of the lease and this Operating Agreement shall run with the demised premises and inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

Section 37 - Section Headings

The section headings in this instrument are inserted for convenience only and shall not be considered a part of this Operating Agreement nor be used in its interpretation.

IN WITNESS WHEREOF, the parties hereto have duly executed this instrument in triplicate as of the day and year first above written.

Signed, Sealed and Delivered in Presence of:
/s/ Mary A. Olson	/s/ Philip L. Ray
	Philip L. Ray
/s/ Dorothy A. Habermaier
As to Philip L. Ray
/s/ [illegible]	/s/ Ralph Budd
	Ralph Budd
/s/ R. L. Pendlebury
As to Ralph Budd
/s/ Mary A. Olson	/s/ Louis W. Hill, Jr.
	Louis W. Hill, Jr.
/s/ Dorothy A. Habermaier
As to Louis W. Hill, Jr.
/s/ Mary A. Olson	/s/ Wilfrid E. Rumble
	Wilfrid E. Rumble
/s/ Dorothy A. Habermaier
As to Wilfrid E. Rumble	All as Trustees as aforesaid.

36

	UNITED STATES STEEL CORPORATION
/s/ Benjamin J. Blacik	by	/s/ Christian F. Beukema
		President of its
		Oliver Iron Mining Division
/s/ Emmey J. Prisk	Attest:	/s/ Howard P. Clarke
As to United States Steel Corporation		Its Assistant Secretary

37

STATE OF MINNESOTA,	)
	) ss.
County of Ramsey.	)

On this 13th day of June, 1960, before me, a Notary Public within and for said County and State, appeared PHILIP L. RAY, LOUIS W. HILL, JR., and WILFRID E. RUMBLE, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Mary A. Olson

Notary Public

Ramsey County, Minnesota
My Commission Expires January 25, 1962

STATE OF CALIFORNIA,	)
	) ss.
County of Santa Barbara.	)

On this 21st day of June, 1960, before me, a Notary Public within and for said County and State, appeared RALPH BUDD, to me personally known, who, being by me personally sworn, did say that he is a Trustee under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; and that as said Trustee he executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ R. L. Pendlebury

Notary Public

Santa Barbara County, California
My Commission Expires July 8, 1962

38

STATE OF MINNESOTA,	)
	) ss.
County of St. Louis.	)

On this 1st day of July, 1960, before me, a Notary Public within and for said County and State, personally appeared CHRISTIAN F. BEUKEMA, to me personally known, who, being by me duly sworn, did say that he is _________ President of Oliver Iron Mining Division, UNITED STATES STEEL CORPORATION, a New Jersey corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation, and that said instrument is the corporate seal of said corporation, and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors, and said CHRISTIAN F. BEUKEMA acknowledged said instrument to be the free act and deed of said corporation.

/s/ E. J. Prisk

Notary Public

St. Louis County, Minnesota
My Commission Expires Sept. 25. 1964

39

“EXHIBIT A”

Outstanding Property Interests

Lot 1, Section 1, 58-18

Railway R/W D.,Wpg.& Pac.Ry.Co. 5/28/1913 Ry. R/W #97

Lots 2 and 3, and  

SE1/4-NW1/4, Section 1, 58-18

Prindle Mine Spur D.M.& N.Ry.Co. 5/28/1915 Ry. R/W #116

SE1/4-NE1/4, Section 2, 58-18

Private Road Oliver Iron Mining Co. 6/1/1951 Roads #133

Wheeling Mine Lease Skubic Bros. Co. 1/1/1955 Wheeling #1 & #2

NE1/4-SW1/4, Section 2, 58-18

Public Highway County of St. Louis 2/7/1921 Roads #25

Telephone Line N.W. Bell Tele. Co. 1/2/1942 Tele. #66

Power Line M.P.&L. Co. 1/1/1958 Power #272

SE1/4-SW1/4, Section 2, 58-18

Railway R/W (Hanna and

Pilot Mine Spurs) G.N. Ry.Co. 4/8/1920 Ry. R/W #291

Railroad Lines G.N. Ry.Co. 3/7/1949 Ry. R/W #404

Railroad Lines G.N. Ry.Co. 8/1/1950 Ry. R/W #413

Power Line M.P.& L.Co. 1/1/1958 Power #272

SW1/4-SE1/4, Section 2, 58-18

Railroad Lines G.N. Ry.Co. 8/1/1950 Ry. R/W #413

THIS INDENTURE, made and entered into this 20th day of August, 1981, but effective as of January 1, 1978, by and between:

WILLIAM W. WATSON, LOUIS W. HILL, JR., HARRY L. HOLTZ and JOSEPH S. MICALLEF, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”;

and

UNITED STATES STEEL CORPORATION, a Delaware corporation, party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH:

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation, a New Jersey corporation, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast quarter of the Northeast quarter (SE¼ of NE¼), the East half of the Southwest quarter (E½ of SW¼), and the Southwest quarter of the Southeast quarter (SW¼ of SE¼) of Section Two (2); the Southwest quarter of the Northeast quarter (SW¼ of NE¼); and the Southeast quarter of the Northwest quarter (SE¼ of NW¼) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

The Southeast quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be

overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government survey thereof by Frank D. Howe in 1878; and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast quarter of the Northwest quarter (SE¼ of NW¼), and the West half of the Southwest quarter (W½ of SW¼) of Section One (1); the Northwest quarter (NW¼), and the Northeast quarter of the Southeast quarter (NE¼ of SE¼) of Section Two (2); the East half of the Northeast quarter (E½ of NE¼) of Section Three (3); the Northeast quarter of the Southwest quarter (NE¼ of SW¼), and the South half of the Southwest quarter (S½ of SW¼) of Section Five (5); the Southeast quarter of the Northeast quarter (SE¼ of NE¼) of Section Seven (7); the North half of the Northeast quarter (N½ of NE¼), the Southeast quarter of the Northeast quarter (SE¼ of NE¼), the Northeast quarter of the Northwest quarter (NE¼ of NW¼), the Southwest quarter of the Northwest quarter (SW¼ of NW¼), the North half of the Southwest quarter (N½ of SW¼), and the Southeast quarter (SE¼) of Section Eight (8); the Southwest quarter of the Northwest quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest quarter of the Northeast quarter (NW¼ of NE¼) and the Northeast quarter of the Northwest quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; and all the ores and minerals in, under, and upon also the North half of the Southwest quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government survey thereof; together with all of the mining and other privileges, rights, interests, and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine, and remove said ores and minerals); all as such ores and minerals, privileges, rights, interests, and estates were excepted and reserved in prior deeds of record; and together with any and all right, title, and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter included in the reference to the “demised premises”, for the several purposes defined in said Indenture of Lease;

WHEREAS, the Lessee has succeeded, by merger of corporations, to the leasehold estate so conveyed to said United States Steel Corporation, a New Jersey corporation;

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as to certain particulars;

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and

2

with each other that the said Operating Agreement dated as of January 1, 1959 shall be, and hereby is, amended as of January 1, 1978, in the following particulars only, and not otherwise, to-wit:

Section 13 of said Operating Agreement, entitled “Payment of Royalty by Application of Lessee’s Surface Acquisition Costs”, is amended so as to add thereto the following, to-wit:

“From and after each application of acquisition costs in settlement of excess royalty as hereinabove provided, the Lessee shall, during the continuance of this lease, administer, in a manner being in its sole judgment, the existence and utilization of any buildings then located upon those respective surface lands to be conveyed by reason of each such application. The Lessee shall perform, or be obligated to perform, all legal obligations growing out of the existence of such buildings or out of the administration thereof by the Lessee. All capital improvements and costs of repairs and maintenance, required by law or made voluntarily, shall be made at the sole expense of the Lessee. The Lessee may, in its sole judgment, dispose of such buildings in any manner, including sale for removal off the demised premises and demolition. The Lessee shall indemnify and save harmless the Lessors from all legal requirements and obligations arising out of the existence, utilization, or disposal of such buildings during the continuance of this lease. The Lessee may keep for its own account all rentals, fees, and sales proceeds derived from such administration in payment for the obligations assumed under this paragraph and in reimbursement of the tax obligations assumed by the Lessee as to such buildings under Section 23 of this Operating Agreement. No accounting for such administration need be made by the Lessee to the Lessors, but the Lessee shall report to the Lessors each removal, demolition, or destruction of any such buildings.

3

“All actions by the Lessee taken under the immediate foregoing paragraph may be taken in the sole name of the Lessee and when so done shall be binding upon the Lessors, but the Lessors shall execute any documents when such execution will be required by law or custom.

“Each lease or license granted under these provisions by the Lessee to others for the use or occupancy of any buildings shall be limited, from time to time, to a three (3) year term and shall be terminable upon a ninety (90) day termination clause by the Lessee, or by the Lessors after the termination in any manner of the said Operating Agreement or after the termination of this amendment thereto.

“The Lessors shall have the right to terminate at any time this amendment to Section 13 of said Operating Agreement by giving to the Lessee at least one (1) year’s written notice by registered or certified mail deposited in any Post Office in the United States, postage prepaid, addressed to the Lessee at 800 Missabe Building, Duluth, Minnesota, 55802, or to such other place as the Lessee will have last designated in writing to the Lessors.

“This amendment to Section 13 of said Operating Agreement shall, in any event, terminate upon the termination of the Great Northern Iron Ore Properties Trust.”

4

IN WITNESS WHEREOF, the parties hereto have duly executed this instrument in triplicate as of the day and year first above written, but effective as of January 1, 1978.

/s/ William W. Watson	UNITED STATES STEEL CORPORATION
William W. Watson
/s/ Louis W. Hill, Jr.	by	/s/ R. D. Goldback
Louis W. Hill, Jr.		Vice President
/s/ Harry L. Holtz	Attest:	/s/ [illegible]
Harry L. Holtz		Assistant Secretary
/s/ Joseph S. Micallef
Joseph S. Micallef All as trustees as aforesaid

STATE OF MINNESOTA,	)
	) ss.
County of Ramsey.	)

On this 21st day of August, 1981, before me, a Notary Public within and for said County and State, appeared WILLIAM W. WATSON, LOUIS W. HILL, JR., HARRY L. HOLTZ and JOSEPH S. MICALLEF, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Carole D. Lockrem

Notary Public
Ramsey County, Minnesota
My Commission Expires June 26, 1987

5

STATE OF PENNSYLVANIA	)
	) ss.
County of Allegheny	)

On this 1st day of September, 1981, before me, a Notary Public within and for said County and State, personally appeared R. D. Goldback, to me personally known, who, being by me duly sworn, did say that he is Vice President of UNITED STATES STEEL CORPORATION, a Delaware corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation, and that said instrument is the corporate seal of said corporation; and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors, and said R. D. Goldback acknowledged said instrument to be the free act and deed of said corporation.

/s/ Lois A. Witt

Notary Public
Pittsburgh, Allegheny County
Commonwealth of Pennsylvania
My Commission Expires October 18, 1982

6

THIS INDENTURE, made and entered into this 7th day of December, 1987, but effective as of January 1, 1987 by and between:

HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain document dated December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”; and

USX CORPORATION (formerly known as UNITED STATES STEEL CORPORATION), a Delaware corporation,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH:

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as amended by that certain document dated August 20, 1981, but effective as of January 1, 1978, the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation (now known as USX Corporation), a New Jersey corporation, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast Quarter of the Northeast Quarter (SE 1/4 of NE 1/4), the East Half of the Southwest Quarter (E 1/2 of SW 1/4), and the Southwest Quarter of the Southeast Quarter (SW 1/4 of SE 1/4) of Section Two (2); the Southwest Quarter of the Northeast Quarter (SW 1/4 of NE 1/4); and the Southeast Quarter of the Northwest Quarter (SE 1/4 of NW 1/4) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

The Southeast Quarter (SE 1/4) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by William P. Allen

in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by Frank D. Howe in 1878; and all the ores and minerals in, under and upon also Government Lots Two (2) and Three (3), the Southeast Quarter of the Northwest Quarter (SE 1/4 of NW 1/4), and the West Half of the Southwest Quarter (W 1/2 of SW 1/4) of Section One (1); the Northwest Quarter (NW 1/4), and the Northeast Quarter of the Southeast Quarter (NE 1/4 of SE 1/4) of Section Two (2); the East Half of the Northeast Quarter (E 1/2 of NE 1/4) of Section Three (3); the Northeast Quarter of the Southwest Quarter (NE 1/4 of SW 1/4); and the South Half of the Southwest Quarter (S 1/2 of SW 1/4) of Section Five (5); the Southeast Quarter of the Northeast Quarter (SE 1/4 of NE 1/4) of Section Seven (7); the North Half of the Northeast Quarter (N 1/2 of NE 1/4), the Southeast Quarter of the Northeast Quarter (SE 1/4 of NE 1/4), the Northeast Quarter of the Northwest Quarter (NE 1/4 of NW 1/4), the Southwest Quarter of the Northwest Quarter (SW 1/4 of NW 1/4), the North Half of the Southwest Quarter (N 1/2 of SW 1/4), and the Southeast Quarter (SE 1/4) of Section Eight (8); the Southwest Quarter of the Northwest Quarter (SW 1/4 of NW 1/4) of Section Nine (9); and the Northwest Quarter of the Northeast Quarter (NW 1/4 of NE 1/4) and the Northeast Quarter of the Northwest Quarter (NE 1/4 of NW 1/4) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; and all the ores and minerals in, under, and upon also the North Half of the Southwest Quarter (N 1/2 of SW 1/4) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; together with all of the mining and other privileges, rights, interests and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine and remove said ores and minerals); all as such ores and minerals, privileges, rights, interests and estates were excepted and reserved in prior deeds of record; and together with any and all right, title and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter included in the reference to the “demised premises”, for the several purposes defined in said Indenture of Lease;

WHEREAS, the Lessee has succeeded, by merger of corporations, to the leasehold estate so conveyed to said USX Corporation, a Delaware corporation;

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as to certain particulars;

2

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1959, as amended as of January 1, 1978 shall be and hereby is amended further as of January 1, 1987, in the following particulars only, and not otherwise, to-wit:

Section 10 of the Operating Agreement entitled “Royalty” is amended as follows:

1. Delete in its entirety the paragraph entitled “Class C Ore:” and insert, therefore the following:

“Class C Ore: On Class C ore the rate of royalty per ton shall be the product resulting from multiplying   ***  , hereinafter referred to as the “reference rate”, by the percent of weight recovery of taconite ore as defined in Section 10(b) hereof.”

2. In the last paragraph, delete the wording “and said reference rate for Class C ore, respectively,”

3. Add the following two paragraphs at the end of the Section:

“Said reference rate for Class C ore shall be adjusted by $   ***   times an amount by which the Producer Price Index for the Iron and Steel Subgroup (with 1967 equal 100 as the base) fluctuates from the January 1987 level of 346.8. For example: Reference rate = $   ***   + [$   ***   (I.S. – 346.8)].

“For the five-year period, 1987, 1988, 1989, 1990 and 1991, the royalty rate on Class C ore shall be   ***   of the calculated rate.”

Section 10(a) of the Operating Agreement, entitled “Determination of Current Market Value at Lake Erie Ports of Mesabi Range Bessemer Ore” is amended as follows:

1. Add to the heading the words “and Determination of the Producer Price Index for the Iron and Steel Subgroup.”

2. Add the following paragraph at the end of the Section:

“Not withstanding the above, Class C ore shall, during the remaining time of this Operating Agreement, be governed by the following:

The Producer Price Index for the Iron and Steel Subgroup used to establish the ‘Reference Rate’ shall be the unadjusted index (with

3

1967 = 100 as the base), commodity Code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November, as the case may be) immediately preceding the quarter in which royalty payments are due on shipments made. For example: The Iron and Steel Subgroup index for February would be used to calculate the royalty on shipments made in the second calendar quarter.”

Section 11 of the Operating Agreement entitled “Minimum Royalty” is amended to add the following paragraph:

“For the total five year period encompassing the years 1987, 1988, 1989, 1990 and 1991, Lessee guarantees to produce   ***   of its total production from GNIOP lands.” However, USX makes no guarantee as to production in any particular year.”

Section 13 of the Operating Agreement entitled “Payment of Royalty by Application of Lessee’s Surface Acquisition Costs” is amended to add the following paragraph:

“During the years 1987, 1988, 1989, 1990 and 1991, Lessee will make no property purchases for the account of Great Northern Iron Ore Properties.”

4

IN WITNESS WHEREOF, the parties have duly executed this instrument in triplicate as of the day and year first above written, but effective as of January 1, 1987.

/s/ Harry L. Holtz
Harry L. Holtz
/s/ Joseph S. Micallef
Joseph S. Micallef
/s/ Roger W. Staehle
Roger W. Staehle
/s/ Robert A. Stein
Robert A. Stein
All as Trustees as aforesaid
USX CORPORATION
By	/s/ G. Colombari
	Senior Vice President Related Resources
Attest:	/s/ R. M. Stanton
	Assistant Secretary

5

STATE OF MINNESOTA,	)
	) ss.
COUNTY OF RAMSEY	)

On this 7th day of December, 1987, before me, a Notary Public within and for said County and State, appeared HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Carole D. Lockrem

Notary Public
Ramsey County, Minnesota
My Commission Expires June 25, 1993

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF ALLEGHENY	)

On this 28th day of December, 1987, before me a Notary Public within and for said County and State, personally appeared G. Colombari, to me personally known, who, being by me duly sworn, did say that he is Senior Vice President-Related Resources of USX CORPORATION, a Delaware corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation; and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors, and said G. Colombari acknowledged said instrument to be the free act and deed of said corporation.

/s/ Lois A. Witt

Notary Public
Pittsburgh, Allegheny County
Commonwealth of Pennsylvania
My Commission Expires October 18, 1990

6

THIS INDENTURE, made and entered into this 9th day January, 1992, but effective as of January 1, 1992 by and between:

HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain document dated December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”; and

USX CORPORATION (formerly known as UNITED STATES STEEL CORPORATION), a Delaware corporation,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as amended by that certain document dated August 20, 1981, but effective as of January 1, 1978, and further amended by that certain document dated December 7, 1987, but effective as of January 1, 1987 (hereinafter the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation (now known as USX Corporation), a New Jersey corporation, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast Quarter of the Northeast Quarter (SE 1/4 of NE 1/4), the East Half of the Southwest Quarter (E 1/2 of SW 1/4), and the Southwest Quarter of the Southeast Quarter (SW 1/4 of SE 1/4) of Section Two (2); the Southwest Quarter of the Northeast Quarter (SW 1/4 of NE 1/4); and the Southeast Quarter of the Northwest Quarter (SE 1/4 of NW 1/4) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

The Southeast Quarter (SE 1/4) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by Frank D. Howe in 1878 and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast Quarter of the Northwest Quarter (SE 1/4 of NW 1/4), and the West Half of the Southwest Quarter (W 1/2 of SW 1/4) of Section One (1); the Northwest Quarter (NW 1/4), and the Northeast Quarter of the Southeast Quarter (NE 1/4 of SE 1/4) of Section Two (2); the East Half of the Northeast Quarter (E 1/2 of NE 1/4) of Section Three (3); the Northeast Quarter of the Southwest Quarter (NE 1/4 of SW 1/4); and the South Half of the Southwest Quarter (S 1/2 of SW 1/4) of Section Five (5); the Southeast Quarter of the Northeast quarter (SE 1/4 of NE 1/4) of Section Seven (7); the North Half of the Northeast Quarter (N 1/2 of NE 1/4), the Southeast Quarter of the Northeast Quarter (SE 1/4 of NE 1/4), the Northeast Quarter of the Northwest Quarter (NE 1/4 of NW 1/4), the Southwest Quarter of the Northwest Quarter (SW 1/4 of NW 1/4), the North Half of the Southwest Quarter (N 1/2 of SW 1/4), and the Southeast Quarter (SE 1/4) of Section Eight (8); the Southwest Quarter of the Northwest Quarter (SW 1/4 of NW 1/4) of Section Nine (9); and the Northwest Quarter of the Northeast Quarter (NW 1/4 of NE 1/4) and the Northeast Quarter of the Northwest Quarter (NE 1/4 of NW 1/4) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; and all the ores and minerals in, under, and upon also the North Half of the Southwest Quarter (N 1/2 of SW 1/4) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; together with all of the mining and other privileges, rights, interests and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine and remove said ores and minerals); all as such ores and minerals, privileges, rights, interest and estates were excepted and reserved in prior deeds of record; and together with any and all right, title and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter referred to as the “demised premises”, for the several purposes defined in said Indenture of Lease;

WHEREAS, the Lessee has succeeded, by merger of corporations, to the leasehold estate so conveyed to said United States Steel Corporation, a New Jersey corporation; and

2

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Indenture of Lease and Operating Agreement as to certain particulars;

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1959, as amended on August 20, 1981, but effective as of January 1, 1978, and later amended on December 7, 1987, but effective as of January 1, 1987, shall be and hereby is further amended and effective as of January 1, 1992, in the following particulars only, and not otherwise, to-wit;

Section 10 of the Operating Agreement entitled “Royalty” is amended by adding the following paragraph at the end of the said Section:

“For the ten-year period, 1992 through 2001, the royalty rate on Class C ore shall be the product resulting from multiplying (i)   ***  , “Adjusted Reference Rate,” by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup for the quarterly calculation period, as defined in Section 10(a) hereof, to the November 1991 Producer Price Index for the Iron and Steel Subgroup, by (iii) the percent of weight recovery of taconite ore as defined in Section 10(b) hereof. For example:

	(PPI I/S Qtrly Calculation Period)
$   ***	(November 1991, PPI I/S       )	Weight Recovery.”

Section 10(a) of the Operating Agreement entitled “Determination of Current Market Value at Lake Erie Ports of Mesabi Range Bessemer Ore and Determination of the Producer Price Index for the Iron and Steel Subgroup” is amended to add the following paragraph at the end of the said Section:

“Notwithstanding the above, Class C Ore shall, for the ten-year period 1992 through 2001, be governed by the following:

The Producer Price Index for the Iron and Steel Subgroup, to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November, of years 1992 through 2001) immediately preceding the quarter in which

3

royalty payments are due on shipments made. For example: The Iron and Steel Subgroup index for February would be used to calculate the royalty on shipments made in the second calendar quarter.”

Section 11 of the Operating Agreement entitled “Minimum Royalty” is amended to add the following paragraph at the end of said Section:

“For the five-year period encompassing the years 1992, 1993, 1994, 1995 and 1996, Lessee guarantees to produce not less than   ***   of its total production for each and every year from the demised premises and not less than   ***   of its total production for that five-year period from the demised premises. For the five-year period encompassing the years 1997, 1998, 1999, 2000 and 2001, Lessee guarantees to produce not less than   ***   of its total production for each and every year from the demised premises and not less than   ***   of its total production for that five-year period from the demised premises.”

All other terms and conditions of the Indenture of Lease and Operating Agreement are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument in triplicate as of the day and year first above written, but effective as of January 1, 1992.

/s/ Harry L. Holtz
Harry L. Holtz
/s/ Joseph S. Micallef
Joseph S. Micallef
/s/ Roger W. Staehle
Roger W. Staehle
/s/ Robert A. Stein
Robert A. Stein
All as Trustees as aforesaid
USX CORPORATION
By:	/s/ Charles Gedeon
	President U.S. – Diversified Group
Attest:	/s/ Richard F. Lerach
	Assistant Secretary

4

STATE OF MINNESOTA,	)
	) ss.
COUNTY OF RAMSEY	)

On this 23rd day of January, 1992, before me, a Notary Public within and for said County and State, appeared HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Carole D. Lockrem

Notary Public
Ramsey County, Minnesota
My Commission Expires June 25, 1993

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF ALLEGHENY	)

On this 9th day of January, 1992, before me, a Notary Public within and for said County and State, personally appeared CHARLES C. GEDEON, to me personally known, who, being by me duly sworn, did say that he is President-U. S. Diversified Group of USX CORPORATION, a Delaware corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation; and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors, and said Charles C. Gedeon acknowledged said instrument to be the free act and deed of said corporation.

/s/ Carol A. Marcinowski

Notary Public
Pittsburgh, Allegheny County, PA
My Commission Expires July 19, 1994

5

THIS INDENTURE, made and entered into this 4th day of October, 1999, but effective as of January 1, 1997 by and between:

JOSEPH S. MICALLEF, HARRY L. HOLTZ, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain document dated December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”; and

USX CORPORATION (formerly known as UNITED STATES STEEL CORPORATION), a Delaware corporation,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as amended by that certain document dated August 20, 1981, but effective as of January 1, 1978, and later amended by that certain document dated December 7, 1987, but effective as of January 1, 1987, and further amended by that certain document dated January 9, 1992, but effective as of January 1, 1992 (hereinafter the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation (now known as USX Corporation), a Delaware corporation, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the East Half of the Southwest Quarter (E½ of SW¼), and the Southwest Quarter of the Southeast Quarter (SW¼ of SE¼) of Section Two (2); the Southwest Quarter of the Northeast Quarter (SW¼ of NE¼); and the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

The Southeast Quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by Frank D. Howe in 1878 and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼), and the West Half of the Southwest Quarter (W½ of SW¼) of Section One (1); the Northwest Quarter (NW¼), and the Northeast Quarter of the Southeast Quarter (NE¼ of SE¼) of Section Two (2); the East Half of the Northeast Quarter (E½ of NE¼) of Section Three (3); the Northeast Quarter of the Southwest Quarter (NE¼ of SW¼); and the South Half of the Southwest Quarter (S½ of SW¼) of Section Five (5); the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼) of Section Seven (7); the North Half of the Northeast Quarter (N½ of NE¼), the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼), the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼), the North Half of the Southwest Quarter (N½ of SW¼), and the Southeast Quarter (SE¼) of Section Eight (8); the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest Quarter of the Northeast Quarter (NW¼ of NE¼) and the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; and all the ores and minerals in, under, and upon also the North Half of the Southwest Quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; together with all of the mining and other privileges, rights, interests and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine and remove said ores and minerals); all as such ores and minerals, privileges, rights, interest and estates were excepted and reserved in prior deeds of record; and together with any and all right, title and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter referred to as the “demised premises”, for the several purposes defined in said Indenture of Lease;

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Operating Agreement as to certain particulars;

2

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1959, as amended on August 20, 1981, but effective as of January 1, 1978, and later amended on December 7, 1987, but effective as of January 1, 1987, and further amended on January 9, 1992, but effective as of January 1, 1992, shall be and hereby is further amended and effective as of January 1, 1997, in the following particulars only, and not otherwise, to-wit:

Section 3 of the Operating Agreement entitled “Definitions” is amended by removing the words “other than stockpiling” from item (2) of the last paragraph (defining “ship”, “shipped”, and “shipment”) on page 4.

All other terms and conditions of the Indenture of Lease and Operating Agreement are hereby ratified and affirmed.

3

IN WITNESS WHEREOF, the parties have duly executed this instrument in triplicate as of the day and year first above written, but effective as of January 1, 1997.

GREAT NORTHERN IRON ORE PROPERTIES
/s/ Joseph S. Micallef
Joseph S. Micallef
/s/ Harry L. Holtz
Harry L. Holtz
/s/ Roger W. Staehle
Roger W. Staehle
/s/ Robert A. Stein
Robert A. Stein
All as Trustees as aforesaid
U. S. STEEL GROUP, a unit of USX Corporation
By:	/s/ Charles C. Gedeon
	Executive Vice President Raw Materials & Diversified Business
Attest:	/s/ Kenneth R. Peppesnoy
	Assistant Secretary

4

STATE OF MINNESOTA,	)
	) ss.
COUNTY OF RAMSEY	)

On this 18th day of February, 2000, before me, a Notary Public within and for said County and State, appeared JOSEPH S. MICALLEF, HARRY L. HOLTZ, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Rose M. Tester

Notary Public
My commission expires: Jan. 31. 2005

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF ALLEGHENY	)

On this 10th day of January, 2000, before me, a Notary Public within and for said County and State, personally appeared CHARLES C. GEDEON, to me personally known, who, being by me duly sworn, did say that he is Executive Vice President – Raw Materials & Diversified Business of U. S. Steel Group, a unit of USX Corporation, a Delaware corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the corporate seal of said corporation; and that said instrument was signed and sealed on behalf of said corporation by authority of its Board of Directors, and said Charles C. Gedeon acknowledged said instrument to be the free act and deed of said corporation.

/s/ Mary Margaret Hussey

Notary Public
My commission expires: June 2, 2000

5

THIS INDENTURE, made and entered into this 2^nd day of August, 2001, but effective as of January 1, 2002 by and between:

JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain document dated December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors”; and

UNITED STATES STEEL LLC (formerly known as USX CORPORATION and UNITED STATES STEEL CORPORATION), a Delaware limited liability company,

party of the second part, hereinafter referred to as “Lessee”,

WITNESSETH

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as amended by that certain document dated August 20, 1981, but effective as of January 1, 1978, and further amended by that certain document dated December 7, 1987, but effective as of January 1, 1987, and further amended by that certain document dated January 9, 1992, but effective as of January 1, 1992, and further amended by that certain document dated October 4, 1999, but effective as of January 1, 1997 (hereinafter the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation (now known as United States Steel LLC), a Delaware limited liability company, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the East Half of the Southwest Quarter (E½ of SW¼), and the Southwest Quarter of the Southeast Quarter (SW¼ of SE¼) of Section Two (2); the Southwest Quarter of the Northeast Quarter (SW¼ of NE¼); and the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼) of Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

The Southeast Quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof,

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by Frank D. Howe in 1878 and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼), and the West Half of the Southwest Quarter (W½ of SW¼) of Section One (1); the Northwest Quarter (NW¼), and the Northeast Quarter of the Southeast Quarter (NE¼ of SE¼) of Section Two (2); the East Half of the Northeast Quarter (E½ of NE¼) of Section Three (3); the Northeast Quarter of the Southwest Quarter (NE¼ of SW¼); and the South Half of the Southwest Quarter (S½ of SW¼) of Section Five (5); the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼) of Section Seven (7); the North Half of the Northeast Quarter (N½ of NE¼), the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼), the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼), the North Half of the Southwest Quarter (N½ of SW¼), and the Southeast Quarter (SE¼) of Section Eight (8); the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest Quarter of the Northeast Quarter (NW¼ of NE¼) and the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; and all the ores and minerals in, under, and upon also the North Half of the Southwest Quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; together with all of the mining and other privileges, rights, interests and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine and remove said ores and minerals); all as such ores and minerals, privileges, rights, interest and estates were excepted and reserved in prior deeds of record; and together with any and all right, title and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter referred to as the “demised premises”, for the several purposes defined in said Indenture of Lease;

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Operating Agreement as to certain particulars;

2

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1959, as amended on August 20, 1981, but effective as of January 1, 1978, and further amended on December 7, 1987, but effective as of January 1, 1987, and further amended on January 9, 1992, but effective as of January 1, 1992, and further amended on October 4, 1999, but effective as of January 1, 1997, shall be and hereby is further amended and effective as of January 1, 2002, in the following particulars only, and not otherwise, to-wit:

Section 10 of the Operating Agreement entitled “Royalty” is amended as follows:

1. Insert the following at the end of the paragraph designated Class C Ore:

“Notwithstanding the above, beginning January 1, 2002, and continuing for the remaining time of this Operating Agreement, the rate of royalty on Class C Ore shall be   ***  , hereinafter referred to as the “Reference Rate”.”

2. Add the following two paragraphs at the end of said Section:

“Notwithstanding the above, beginning January 1, 2002, and continuing for the remaining time of this Operating Agreement, said Reference Rate for Class C Ore shall be adjusted by the ratio of the PPI I/S, rounded to four decimal places, for the quarterly calculation period, as defined in Section 10(a) hereof, to the November 2001 PPI I/S, said resulting product hereinafter referred to as the “Adjusted Reference Rate”, rounded to the nearest one-tenth of one cent ($.001). In no event shall the Adjusted Reference Rate be less than the Reference Rate   ***  . For example:

***    x	PPI I/S Quarterly Calculation Period	= Adjusted Reference Rate
	November 2001, PPI I/S

Notwithstanding the above, for the three-year period 2002, 2003 and 2004, the royalty rate on Class C Ore shall be   ***   , provided the tonnage guarantee, as defined in Section 11 of the Operating Agreement, for each of the three years (2002, 2003 and 2004) is met. If the tonnage guarantee for any one of the three years is not met, Lessee will pay Lessors the amount required to attain the tonnage guarantee for that year, said amount hereinafter referred to as the “Tonnage Guarantee Deficiency”, and payable with the fourth quarter royalty due for the respective calendar year in which said Tonnage Guarantee Deficiency occurs. Any amount paid by Lessee to Lessors as Tonnage Guarantee Deficiency will not be recoverable with subsequent shipments as “Advance or Prepaid Royalty” pursuant to the provisions of Section 12 of the Operating Agreement.”

3

Section 10(a) of the Operating Agreement entitled “Determination of Current Market Value at Lake Erie Ports of Mesabi Range Bessemer Ore and Determination of the Producer Price Index for the Iron and Steel Subgroup” is amended to add the following paragraph at the end of the said Section:

“Notwithstanding the above, Class C Ore shall, for the period beginning January 1, 2002, and continuing for the remaining time of this Operating Agreement, be governed by the following:

The Producer Price Index for the Iron and Steel Subgroup, to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as the base), commodity code 101, published by the Bureau of Labor Statistics of the United States Department of Labor, herein referred to as the “PPI I/S”, for the second month in the quarterly period (i.e., for February, May, August or November, as the case may be) immediately preceding the quarter in which royalty payments are due on shipments made. For example: The Iron and Steel Subgroup Index for February would be used to calculate the royalty on shipments made in the second calendar quarter.”

Section 10(b) of the Operating Agreement entitled “Determination of Weight Recovery Factor” is amended to add the following paragraph at the end of said Section:

“Notwithstanding the above, beginning January 1, 2002, and continuing for the remaining time of this Operating Agreement, the factor of the percent of weight recovery for Class C Ore shall be   ***  .”

Section 11 of the Operating Agreement entitled “Minimum Royalty” is amended as follows:

1. Insert the following at the end of the first paragraph:

“Notwithstanding the above, beginning with the calendar year 2002, and continuing for the remaining time of this Operating Agreement, minimum rental or royalty shall be   ***   for each calendar year.”

2. Insert the following paragraph at the end of said Section:

“Notwithstanding the above, for the three-year period encompassing the years 2002, 2003 and 2004, Lessee guarantees to produce not less than   ***   of its total crude ore production for each and every year from the demised premises.”

Section 33 of the Operating Agreement entitled “Addresses” is replaced in its entirety with the following:

4

“For the purposes hereof, the address of the Lessors shall be:

Great Northern Iron Ore Properties

W-1290 First National Bank Building

332 Minnesota Street

Saint Paul, Minnesota 55101

or such other place as the Lessors will have last designated in writing to the Lessee; and the address of the Lessee shall be:

United States Steel LLC

Minnesota Ore Operations

P. O. Box 417

Mountain Iron, Minnesota 55768

or such other place as the Lessee will have last designated in writing to the Lessors.”

All other terms and conditions of the Indenture of Lease and Operating Agreement are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument in triplicate as of the day and year first above written, but effective as of January 1, 2002.

GREAT NORTHERN IRON ORE PROPERTIES
/s/ Joseph S. Micallef
Joseph S. Micallef
/s/ Roger W. Staehle
Roger W. Staehle
/s/ Robert A. Stein
Robert A. Stein
All as Trustees as aforesaid
UNITED STATES STEEL LLC
By:	/s/ Charles C. Gedeon
	Executive Vice President Raw Materials & Diversified Business
Attest:	/s/ Kenneth R. Peppesnoy
	Assistant Secretary

5

STATE OF MINNESOTA,	)
	) ss.
COUNTY OF RAMSEY	)

On this 10th day of October, 2001, before me, a Notary Public within and for said County and State, appeared JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Rose M. Tester

Notary Public
My commission expires: Jan. 31, 2005

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF ALLEGHENY	)

On this 5th day of September, 2001, before me, a Notary Public within and for said County and State, personally appeared CHARLES C. GEDEON, to me personally known, who, being by me duly sworn, did say that he is Executive Vice President – Raw Materials & Diversified Business of United States Steel LLC, a Delaware limited liability company, the company named in the foregoing instrument; that the seal affixed to said instrument is the seal of said company; and that said instrument was signed and sealed on behalf of said company by authority of its Board of Directors, and said Charles C. Gedeon acknowledged said instrument to be the free act and deed of said company.

/s/ Mary Margaret Hussey

Notary Public
My commission expires: June 2, 2003

6

THIS INDENTURE, made and entered into this 12th day of September, 2003, but effective as of July 1, 2003, by and between:

JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, as Trustees under that certain document dated December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as Great Northern Iron Ore Properties,

parties of the first part, hereinafter referred to as “Lessors;” and

UNITED STATES STEEL CORPORATION (formerly known as UNITED STATES STEEL LLC and USX CORPORATION), a Delaware corporation,

party of the second part, hereinafter referred to as “Lessee.”

WITNESSETH

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1959, as amended by that certain document dated August 20, 1981, but effective as of January 1, 1978, and further amended by that certain document dated December 7, 1987, but effective as of January 1, 1987, and further amended by that certain document dated January 9, 1992, but effective as of January 1, 1992, and further amended by that certain document dated October 4, 1999, but effective as of January 1, 1997, and further amended by that certain document dated August 2, 2001, but effective as of January 1, 2002 (hereinafter referred to as the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to United States Steel Corporation, a Delaware corporation, a leasehold estate, until and including December 31, 2057, in the following described lands and premises situated and being in the County of St. Louis and State of Minnesota, to-wit:

The Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the East Half of the Southwest Quarter (E½ of SW¼), and the Southwest Quarter of the Southeast Quarter (SW¼ of SE¼) of Section Two (2); the Southwest Quarter of the Northeast Quarter (SW¼ of NE¼); and the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼) of

Section Eight (8); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

The Southeast Quarter (SE¼) of Section Thirty-five (35), Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof;

All the ores and minerals in, under, and upon Government Lot One (1) of Section One (1), Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by William P. Allen in 1882, EXCEPTING that part of said Government Lot One (1) that would be overlapped by and included within Government Lot Four (4) of Section Six (6), Township Fifty-eight (58) North, Range Seventeen (17) West of the Fourth Principal Meridian, according to the United States Government Survey thereof by Frank D. Howe in 1878 and all the ores and minerals in, under, and upon also Government Lots Two (2) and Three (3), the Southeast Quarter of the Northwest Quarter (SE¼ of NW¼), and the West Half of the Southwest Quarter (W½ of SW¼) of Section One (1); the Northwest Quarter (NW¼), and the Northeast Quarter of the Southeast Quarter (NE¼ of SE¼) of Section Two (2); the East Half of the Northeast Quarter (E½ of NE¼) of Section Three (3); the Northeast Quarter of the Southwest Quarter (NE¼ of SW¼); and the South Half of the Southwest Quarter (S½ of SW¼) of Section Five (5); the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼) of Section Seven (7); the North Half of the Northeast Quarter (N½ of NE¼), the Southeast Quarter of the Northeast Quarter (SE¼ of NE¼), the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼), the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼), the North Half of the Southwest Quarter (N½ of SW¼), and the Southeast Quarter (SE¼) of Section Eight (8); the Southwest Quarter of the Northwest Quarter (SW¼ of NW¼) of Section Nine (9); and the Northwest Quarter of the Northeast Quarter (NW¼ of NE¼) and the Northeast Quarter of the Northwest Quarter (NE¼ of NW¼) of Section Seventeen (17); all in Township Fifty-eight (58) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; and all the ores and minerals in, under, and upon also the North Half of the Southwest Quarter (N½ of SW¼) of Section Thirty-two (32); Township Fifty-nine (59) North, Range Eighteen (18) West of the Fourth Principal Meridian, according to the United States Government Survey thereof; together with all of the mining and other privileges, rights, interests and estates of the Lessors in or with respect to the lands described in this paragraph (including the privileges and rights to enter upon said lands and to explore for, mine and remove said ores and minerals); all as such ores and minerals, privileges, rights, interest and estates were excepted and reserved in prior deeds of record; and together with any and all right, title and interest that the Lessors may hereafter acquire in or with respect to said lands;

hereinafter referred to as the “demised premises,” for the several purposes defined in said Indenture of Lease; and

2

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Operating Agreement as to certain particulars.

NOW, THEREFORE, in consideration of the premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereto hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1959, as amended on August 20, 1981, but effective as of January 1, 1978, and further amended on December 7, 1987, but effective as of January 1, 1987, and further amended on January 9, 1992, but effective as of January 1, 1992, and further amended on October 4, 1999, but effective as of January 1, 1997, and further amended on August 2, 2001, but effective as of January 1, 2002, shall be and hereby is further amended and effective as of July 1, 2003, in the following particulars only, and not otherwise, to-wit:

Section 10 of the Operating Agreement entitled “Royalty” is amended as follows:

1. Add the following two paragraphs at the end of said Section:

“Notwithstanding the above, for the   ***-year period   ***   through   ***  , the royalty rate on Class C Ore shall be the product resulting from multiplying (i)   ***  , hereinafter referred to as the ‘   ***  ,’ by (ii) a ratio of the Producer Price Index for the Iron and Steel subgroup (PPI I/S), rounded to four decimal places, for the quarterly calculation period, as defined in Section 10(a) hereof, to the May   *** PPI I/S (   ***   ), said resulting product hereinafter referred to as the ‘   ***   ,’ rounded to the nearest one-tenth of one cent ($.001). For example:

***    x	PPI I/S Quarterly Calculation Period	=    ***
	May    ***   , PPI I/S (   ***   )

For the   ***-year period   ***   through   *** , the   *** , as defined above, will be   *** , rounded to the nearest one-tenth of one cent ($.001), for Class C Ore shipped from the demised premises that exceeds   ***   crude ore tons in any stand alone calendar quarter.”

Section 11 of the Operating Agreement entitled “Minimum Royalty” is amended as follows:

3

1.   Insert the following paragraph to follow the end of the second paragraph:

“Notwithstanding the above, for the   ***-year period   ***   through   ***  , minimum rental or royalty shall be   ***   for each calendar year or   ***   for each calendar quarter.”

2.   Insert the following paragraph at the end of said Section:

“Notwithstanding the above, for the   ***-year period   ***   through   ***  , the following production guarantee provisions are required and supersede any overlapping terms previously stated hereinbefore:

For the   ***   -month period   ***   through   ***   , hereinafter referred to as ‘Period One,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed from the demised premises. If the    ***-month production tonnage guarantee of   ***   is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the   ***   production tonnage guarantee for the   ***-month period, said additional equivalent tonnage hereinafter referred to as the ‘Tonnage Guarantee Deficiency – Period One.’ Royalty due for the Tonnage Guarantee Deficiency – Period One shall be determined using the royalty rate then in effect for the fourth quarter of   ***    and shall be payable with the fourth quarter   ***   royalty payment. Payment for any Tonnage Guarantee Deficiency – Period One will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

For the   ***   -year period   ***   through   ***   , hereinafter referred to as ‘Period Two,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed for each and every year from the demised premises. If the annual   ***   production tonnage guarantee for any   ***   of the   ***   years included in Period Two is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the annual   ***   production tonnage guarantee for that year, said additional equivalent tonnage hereinafter referred to as the ‘Tonnage Guarantee Deficiency – Period Two.’ Royalty due for the Tonnage Guarantee Deficiency – Period Two shall be determined using the royalty rate then in effect for the fourth quarter of the respective calendar year and shall be payable with the fourth quarter royalty due for the respective calendar year in which said Tonnage Guarantee Deficiency – Period Two occurs. Payment for any Tonnage Guarantee Deficiency – Period Two, for any of the years   ***   , will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement; however, any Tonnage Guarantee Deficiency – Period Two, for any of the years   ***   , may be credited in subsequent years within Period Two in which shipments exceed the yearly production guarantee of   ***   and will not be carried beyond   ***   , the end of Period Two. Payment for any Tonnage Guarantee Deficiency for the year   ***   will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12

4

of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

For the entire   ***   year period   ***   through   ***, hereinafter referred to as ‘Period Three,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed for the entire   ***   year period from the demised premises. If the   ***   year production tonnage guarantee of   ***   is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the   ***   production tonnage guarantee for the   ***   year period, said additional equivalent tonnage hereinafter referred to as the ‘Tonnage Guarantee Deficiency – Period Three.’ Royalty due for the Tonnage Guarantee Deficiency – Period Three shall be determined using the royalty rate then in effect for the fourth quarter of   ***   and shall be payable with the fourth quarter   ***   royalty payment. Payment for any Tonnage Guarantee Deficiency – Period Three will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

However, in the event there is a Tonnage Guarantee Deficiency – Period Two for the annual guarantee for the specific year   ***   and a Tonnage Guarantee Deficiency – Period Three, then only the greater of the two deficiencies, not both deficiencies, will become due and payable. In any event, as stated above, said ‘greater’ deficiency paid will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

For the   ***-year period   ***   through   ***, hereinafter referred to as ‘Period Four,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed for each and every year from the demised premises. If the annual   ***   production tonnage guarantee for any   ***   of the   ***   years included in Period Four is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the annual   ***   production tonnage guarantee for that year, said additional equivalent tonnage hereinafter referred to as the ‘Tonnage Guarantee Deficiency – Period Four.’ Royalty due for the Tonnage Guarantee Deficiency – Period Four shall be determined using the royalty rate then in effect for the fourth quarter of the respective calendar year and shall be payable with the fourth quarter royalty due for the respective calendar year in which said Tonnage Guarantee Deficiency – Period Four occurs. Payment for any Tonnage Guarantee Deficiency – Period Four for any of the years   ***  , will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement; however, any Tonnage Guarantee Deficiency – Period Four, for any of the years   ***  , may be credited in subsequent years within Period Four in which shipments exceed the yearly production guarantee of   ***   and will not be carried beyond   ***  , the end of Period Four. Payment for any Tonnage Guarantee Deficiency for the year   ***   will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

5

For the entire   ***-year period   ***   through   ***, hereinafter referred to as ‘Period Five,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed for the entire   ***-year period from the demised premises. If the   ***-year production tonnage guarantee of   ***   is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the   ***   production tonnage guarantee for the   ***-year period, said additional equivalent tonnage hereinafter referred to as ‘Tonnage Guarantee Deficiency – Period Five.’ Royalty due for the Tonnage Guarantee Deficiency – Period Five shall be determined using the royalty rate then in effect for the fourth quarter of   ***   and shall be payable with the fourth quarter   ***   royalty payment. Payment for any Tonnage Guarantee Deficiency – Period Five will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

However, in the event there is a Tonnage Guarantee Deficiency – Period Four for the annual guarantee for the specific year   ***   and a Tonnage Guarantee Deficiency – Period Five, then only the greater of the two deficiencies, not both deficiencies, will become due and payable. In any event, as stated above, said ‘greater’ deficiency paid will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement and shall not be credited toward any required production guarantee in any subsequent period.

For the   ***-month period   ***   through   ***, hereinafter referred to as ‘Period Six,’ Lessee guarantees to produce (ship) not less than   ***   of its total crude ore crushed from the demised premises. If the   ***-month production tonnage guarantee of   ***   is not achieved, Lessee will pay Lessors for the additional equivalent tonnage required to attain the   ***   production tonnage guarantee for the   ***-month period, said additional equivalent tonnage hereinafter referred to as the ‘Tonnage Guarantee Deficiency – Period Six.’ Royalty due for the Tonnage Guarantee Deficiency –Period Six shall be determined using the royalty rate then in effect for the second quarter of   ***   and shall be payable with the second quarter   ***   royalty payment. Payment for any Tonnage Guarantee Deficiency – Period Six will not be recoverable with subsequent shipments as ‘Advance or Prepaid Royalty’ pursuant to the provisions of Section 12 of the Operating Agreement.”

Section 13 of the Operating Agreement entitled “Payment of Royalty Application of Lessee’s Surface Acquisition Costs” is amended to add the following paragraph at the end of said Section:

“Notwithstanding the above, for the   ***-year period   ***   through   ***  , Lessors shall allow, as a credit upon royalties as herein provided, up to   ***   of the St. Louis County Assessor’s Market Value, in aggregate, for all surface properties acquired in any calendar year during said   ***-year period. Lessee shall be obligated for any amount that exceeds   ***   of the St. Louis County Assessor’s Market Value, in aggregate, for all surface properties acquired in any calendar year during said   ***-year period. Regardless of the   ***   annual limit for which the Lessors are potentially obligated, as defined herein, once the acquisition is closed by the Lessee, Lessee will convey   ***   of the respective surface ownership acquired to the

6

Lessors, or their nominee, by warranty deed, reserving therein a leasehold interest for the remaining term of the lease and subject to all and singular the terms and conditions of the lease and this Operating Agreement.”

All other terms and conditions of the Indenture of Lease and Operating Agreement are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument, in triplicate, as of the day and year first above written, but effective as of July 1, 2003.

GREAT NORTHERN IRON ORE PROPERTIES
/s/ Joseph S. Micallef
Joseph S. Micallef
/s/ Roger W. Staehle
Roger W. Staehle
/s/ Robert A. Stein
Robert A. Stein
/s/ John H. Roe, III
John H. Roe, III
All as Trustees as aforesaid
UNITED STATES STEEL CORPORATION
By:	/s/ David H. Lohr
	David H. Lohr Vice President – Plant Operations
Attest:	/s/ Kenneth R. Peppesnoy
	Assistant Secretary

7

STATE OF MINNESOTA,	)
	) ss.
COUNTY OF RAMSEY	)

On this 7th day of November, 2003, before me, a Notary Public within and for said County and State, appeared JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Linda J. Bergen

Notary Public
My commission expires: 1-31-2005

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF ALLEGHENY	)

On this 14th day of October, 2003, before me, a Notary Public within and for said County and State, personally appeared DAVID H. LOHR to me personally known, who, being by me duly sworn, did say that he is Vice President - Plant Operations of United States Steel Corporation, a Delaware corporation, the corporation named in the foregoing instrument; that the seal affixed to said instrument is the seal of said corporation; and that said instrument was signed and sealed on behalf of said corporation by authority of its Board of Directors, and said David H. Lohr acknowledged said instrument to be the free act and deed of said corporation.

/s/ Mary Margaret Hussey

Notary Public
My commission expires: June 2, 2007

8

EX-10.3

Exhibit 10.3

Hibbing Taconite Company Mahoning January 1, 1979 Lease and Operating Agreement

and all subsequent amendments through January 1, 2006

INDENTURE OF LEASE

THIS INDENTURE OF LEASE, made as of this 1st day of January, 1979, by and between WILLIAM W. WATSON, LOUIS W. HILL, JR., HARRY L. HOLTZ and JOSEPH S. MICALLEF, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and LOUIS W. HILL, JAMES N. HILL, WALTER J. HILL and EDWARD T. NICHOLS, which Trust is commonly known as Great Northern Iron Ore Properties, Parties of the First Part (hereinafter referred to as “Lessors”), and MAHONING ORE AND STEEL PARTNERSHIP, a Minnesota partnership, Party of the Second Part (hereinafter referred to as “Lessee”).

W I T N E S S E T H:

GRANTING
   CLAUSE   

That in consideration of the sum of One Dollar ($1.00) paid by the Lessee to the Lessors, the receipt of which is hereby acknowledged, in consideration of the covenants, agreements and conditions hereinafter contained, to be observed, kept and performed by the Lessee, and in further consideration of the execution simultaneously herewith and the full and complete performance by the Lessee of a certain Operating Agreement (hereinafter referred to as the “Agreement”) dated January 1, 1979, (which Agreement hereby is referred to and hereby is made a part hereof, as fully as if all the terms and conditions thereof were set forth in this Indenture of Lease), covering, among other things, the operation of the mining properties hereinafter particularly described, the Lessors have demised, leased and granted, and by these presents do demise, lease and grant to the said Lessee, its successors and assigns, upon the terms and subject

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to the conditions herein and in the Agreement set forth, the tracts or parcels of land in Minnesota, more particularly described below, said Agreement and this Indenture of Lease being in substitution and in lieu of that mining lease dated April 1st, 1895, as subsequently modified, supplemented and amended, recorded in the Office of the Register of Deeds of St. Louis County, Minnesota in Book R of Agreements on Page 499, etseq., and recorded in the office of the Register of Deeds of Itasca County, Minnesota, in Book 32, Miscellaneous Records, Page 118, etseq.:

In St. Louis County;

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-Seven (57) North of Range Twenty-One (21) West, St. Louis County,

In Itasca County;

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼), of Section Twenty-Seven (27); Township Fifty-Seven (57) North of Range Twenty-Two (22) West, Itasca County.

All of the foregoing premises, subject to legal highways, surface conveyances and easements, including but not limited to, rights of way and easements for railroads, electric power transmission lines, water lines, ditches, telegraph and telephone wires now of record (which premises, subject to the above-mentioned prior conveyances and encumbrances, are hereinafter

-2-

referred to as the “Premises”), are leased to Lessee for the purpose, among other things, of exploring for, mining, taking out and removing therefrom, and concentrating or otherwise treating and shipping any and all Merchantable Iron Ore, Concentratable Ore and Taconite as those terms are defined in the Agreement, which are or which may hereafter be found on, in or under the Premises or produced therefrom; and so long as Lessee shall pay the minimum royalty or rent as provided in the Agreement, nothing herein contained shall require Lessee to mine the Premises or exercise any or all of the rights herein granted except as it deems it desirable to do so.

Notwithstanding the foregoing grant, Lessee agrees that a grant of right-of-way rights on or over any of the Premises by Lessee to persons or entities not party to this Indenture of Lease for purposes of constructing a railroad or a power line shall require the written consent of Lessors, which consent shall not be unreasonably withheld. In addition, Lessors reserve unto themselves the right to grant rights-of-way and easements on or over any of the Premises, subject to the written consent of Lessee, which consent shall not be unreasonably withheld.

TO HAVE AND TO HOLD, the said Premises, together with all and singular the hereditaments and appurtenances thereunto belonging or in anywise appertaining, unto the Lessee, its successors and assigns, for the term of forty-eight (48) years from and after the date hereof, to and including December 31, 2026, for the purposes aforesaid, subject, however, to the conditions and reservations herein and in the Agreement set forth.

Lessors covenant and agree that Lessee, its successors or assigns, paying the yearly rents and taxes called for by the Agreement and fully performing the covenants and agreements herein contained to be performed, shall and may at all times peaceably and quietly hold and enjoy the Premises, subject to the above-mentioned prior conveyances and encumbrances, and shall

-3-

receive and take the profits thereof without any molestation, interruption and eviction by Lessors, or any other person or persons lawfully claiming or to claim the same by, through or under the Lessors.

The grants contained in this Indenture of Lease are subject, however, to the express condition that in case and as often as the Lessee shall make default in the performance of or by the violation of any of its several covenants, as set forth in the Agreement and in this Indenture, or shall breach any of the conditions thereof or hereof, and such default or breach shall continue uncorrected or unsatisfied by the Lessee for a period of sixty (60) days after written notice thereof shall be given to the Lessee by the Lessors, then and from thenceforward it shall be lawful for the Lessors to declare this Indenture of Lease terminated and the rights of Lessee hereunder forfeited, and the Lessors thereupon immediately, without notice or process of law, may enter upon the Premises by their officers, agents or representatives and resume and hold the sole and exclusive possession and ownership of the same against the Lessee and against all other persons claiming from, through or under it; provided, however, that in case of the termination in the manner aforesaid of such right, title and interest of the Lessee, nevertheless, the Lessors may demand, collect, sue for and recover all moneys at the time of such termination owing to it by the Lessee under and pursuant to the terms and provisions of this Indenture and of the Agreement; and provided, further, that if the Lessee shall perform such covenant or covenants or cure such breach during such period of sixty (60) days, such default or breach shall be deemed to have been cured, and the Lessors shall not have any rights, nor shall the Lessee be subject to any liability based upon such default or breach; and provided also, that if the Lessee shall deny any such default or breach claimed by the Lessors, and shall demand arbitration thereof in accordance with the arbitration provisions contained in the Agreement, the time required for such

-4-

arbitration shall not be deemed a part of such sixty (60) day period, and the Lessee shall have sixty (60) days after the decision of the arbitrators in which to correct any default or breach found by the arbitrators.

IN WITNESS WHEREOF, this Indenture of Lease has been executed by the parties hereto as of the day and year first above written.

/s/ William W. Watson
William W. Watson
/s/ Louis W. Hill, Jr.
Louis W. Hill, Jr.
/s/ Harry L. Holtz
Harry L. Holtz
/s/ Joseph S. Micallef
Joseph S. Micallef
Trustees under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties.
MAHONING ORE AND STEEL PARTNERSHIP
By Bethlehem Steel Corporation as
	General Partner
By	/s/ Robert M. McCann
	Vice President
Attest	/s/ R. G. Masters
	Assistant Secretary

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STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared WILLIAM W. WATSON, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared LOUIS W. HILL, JR., Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

-6-

STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared HARRY L. HOLTZ, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

-7-

STATE OF PENNSYLVANIA	)
	:	SS.
COUNTY OF LEHIGH	)

On this 27^th day of July, 1981, before me, a Notary Public with and for said County and State, personally appeared R. M. McCann and R. G. Masters, to me personally known, who, being each by me duly sworn, did depose and say that they are respectively a Vice President and an Assistant Secretary of Bethlehem Steel Corporation, a general partner of Mahoning Ore and Steel Partnership, the partnership named in the foregoing instrument, and that said instrument was signed in behalf of the partnership by authority of its Management Committee and as the free act and deed of said partnership.

/s/ Beverly A. DeFubic

Notary Public

My commission expires January 7, 1985.

This instrument prepared by:

F. L. Hartman

Attorney at Law

1100 Superior Avenue

Cleveland, Ohio 44114

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AMENDED MAHONING AGREEMENT

TABLE OF CONTENTS

Article I	Granting Clause	2
Article II	Warranty	3
Article III	Definitions	4
Article IV	Lessee’s Covenants	6
	Section 1 Operations	6
	Section 2 Royalty	7
	Section 3 Minimum Royalty	13
	Section 4 Weights	16
	Section 5 Reports	17
	Section 6 Taxes	18
	Section 7 Liens	19
	Section 8 Indemnity	19
Article V	Controversy Not to Suspend Rights	21
Article VI	Inspection by Lessors	21
Article VII	Termination by Lessors	21
Article VIII	Notices	22
Article IX	Termination by Lessee	22
Article X	Surrender and Removal	23
Article XI	Lien of Lessors	24
Article XII	Cross Mining Rights	24
Article XIII	Beneficiation	26
Article XIV	Materials from Prior Operations	29
Article XV	Arbitration	30
Article XVI	Headings	31
Article XVII	Assignment	31
Article XVIII	Successors and Assigns	32
Article XIX	Insolvency	32

MAHONING

OPERATING

AGREEMENT

THIS AGREEMENT, made as of this 1st day of January, 1979, by and between WILLIAM W. WATSON, LOUIS W. HILL, JR., HARRY L. HOLTZ and JOSEPH S. MICALLEF, as Trustees (hereinafter referred to as “Lessors”), under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and LOUIS W. HILL, JAMES N. HILL, WALTER J. HILL and EDWARD T. NICHOLS, which Trust is commonly known as Great Northern Iron Ore Properties, (hereinafter called the “Trust”), and MAHONING ORE AND STEEL PARTNERSHIP, a Minnesota partnership (hereinafter referred to as “Lessee”).

W I T N E S S E T H

WHEREAS, under and by virtue of the mining lease dated April 1st, 1895, recorded in the Office of the Register of Deeds of St. Louis County, Minnesota in Book “R” of Agreements on Page 499, et seq., and recorded in the Office of the Register of Deeds of Itasca County, Minnesota, in Book 32 of Miscellaneous Records on Page 118, et seq. (which lease as heretofore supplemented, amended, and modified, is hereinafter called the “Mahoning Lease”), AMMI W. WRIGHT and others, as lessors, leased to the MAHONING ORE COMPANY, as Lessee, certain mineral and auxiliary lands for mining and related purposes then comprising the Mahoning Mine which now is as hereinafter described; and

WHEREAS, the Lessors have now become and are the owners by mesne transfers of the fee to the Mahoning Mine and the owners of all the right, title and interest of the Lessors and their successors under the Mahoning Lease; and

WHEREAS, the Lessee has succeeded to all the right, title and interest of the MAHONING ORE COMPANY, as Lessee, and is now the owner and holder of the Mahoning Lease and the leasehold estate created thereby; and

WHEREAS, the parties hereto wish to further amend, modify and extend the Mahoning Lease all upon the terms and subject to the provisions hereinafter set forth.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and undertakings of the parties hereinafter set forth, the parties respectively mutually covenant and agree that effective from and after the date hereof, the Mahoning Lease shall be, and the same is, amended, supplemented, and modified so that each, all and singular the terms, provisions, conditions and agreements of the Mahoning Lease shall be those hereinafter set forth, which shall be and constitute, from and after the date hereof, the entire lease and agreement between the parties and in substitution and in lieu of the Mahoning Lease as heretofore supplemented, amended and modified.

AMENDED MAHONING LEASE

ARTICLE I

GRANTING CLAUSE

LEASE OF PREMISES

Lessors, concurrently with the execution of this Agreement, by an indenture of Lease in the form of Exhibit A attached hereto and by this reference incorporated herein, do demise, lease, and grant unto Lessee, for the term of forty-eight (48) years from and after the date hereof, to and including December 31, 2026, those tracts or parcels of land situated in the State of Minnesota described as follows:

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In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-Seven (57) North of Range Twenty-One (21) West, St. Louis County;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼) of Section Twenty-Seven (27), Township Fifty-Seven (57) North of Range Twenty-Two (22) West, Itasca County.

which tracts or parcels of land are hereinafter referred to as the “Premises.”

ARTICLE II

WARRANTY

Lessors covenant and agree that Lessee, its successors or assigns, paying the yearly rents and taxes called for herein and fully performing the covenants and agreement herein contained to be performed, shall and may at all times peaceably and quietly hold and enjoy the Premises, subject to the prior conveyances and encumbrances set out in Exhibit A hereto, and shall receive and take the profits thereof without any molestation, interruption and eviction by Lessors, or any other person or persons lawfully claiming or to claim the same by, through or under Lessors.

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ARTICLE III

DEFINITIONS

The following terms, whenever used in this Agreement, shall have the respective meanings hereinafter set forth unless the context shall otherwise require:

(a) “Concentratable Ore”: all iron ore not falling within the definition of Merchantable Iron Ore or Taconite, which under good mining practices ordinarily and customarily would be mined and treated prior to shipment.

(b) “Concentrates”: the beneficiated products resulting from the treatment of Concentratable Ore by any process whatsoever.

(c) “Mahoning Mine”: the Premises and including all estates, rights, privileges, interests and other property, real or personal, as the same are more particularly described, defined and limited herein and in that certain Indenture of Lease, a true copy of which is attached as Exhibit “A”.

(d) “Merchantable Iron Ore”: iron ore which, in accordance with good engineering methods and in accordance with practices then prevailing in similar work and operations on the Mesabi Range, ordinarily and customarily would be mined and shipped in its natural condition without treatment other than dry screening.

(e) “Oxide Pellets”: pellets in which the iron mineral is composed essentially of hematite (Fe₂0₃), which pellets as of the date hereof are produced in the trade from ore containing hematite or magnetite, or any combination thereof.

(f) “Reduced Pellets or Partially Reduced Pellets”: pellets in which the iron mineral is composed essentially of iron (Fe) and some iron oxide (Fe0).

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(g) “ship”, “shipped” and “shipment”: (i) when used with reference to Merchantable Iron Ore or Taconite, the removal of such ore from the Mahoning Mine for any purpose other than stockpiling, and, if stockpiled, the removal from stockpile for any purpose other than restockpiling; (ii) when used with reference to Concentratable Ore, the removal of such ore from the Mahoning Mine for any purpose other than stockpiling or treatment, and, if stockpiled, the removal from stockpile for any purpose other than treatment or restockpiling; and (iii) when used with reference to Concentrates, the removal of such Concentrates from the place of treatment for any purpose other than stockpiling;

(h) “Taconite”: any ferruginous chert or ferruginous slate in the form of compact, siliceous rock, in which the iron oxide is so finely disseminated that substantially all the rock must be reduced to a size less than 20 mesh (Tyler) by fine grinding in order to obtain a marketable iron-bearing material. Whenever the term “Taconite” is used in this Agreement it shall mean Taconite in its natural state prior to any treatment.

(i) “Taconite Concentrates”: the concentrated product resulting from the treatment of Taconite by any process whatsoever.

(j) “Taconite Lands”: the Premises and all other lands in Townships 57, 58 and 59, Ranges 20, 21 and 22 owned or controlled by Lessee or any successors or successor thereto.

(k) “ton”: the long ton of two thousand two hundred and forty (2,240) pounds avoirdupois.

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(l) “tract” or “tracts”: one or more parcels of land, respectively, described in accordance with the land subdivision system used by the United States Government in the survey of public lands, being either a government lot or one-quarter (¼) of a quarter section, according to the United States Government Survey of the government township in which the parcel is located.

(m) “iron unit”: iron content expressed as a percent of total content e.g. one iron unit equals one percent (1%) of iron (Fe) or 22.4 pounds when referring to a ton.

ARTICLE IV

LESSEE’S COVENANTS

In consideration of the rights and privileges in the said Indenture of Lease and herein granted, Lessee hereby covenants and agrees to and with the Lessors, as follows:

Section 1. Operations

All operations of the Lessee under this Agreement which involve the mining and removal of any ores or materials from the Premises shall be conducted in a good and workmanlike manner and in accordance with good engineering practices, then in effect on the Mesabi Range and Lessee shall furnish to Lessors from time to time upon their request, (i) one copy of Lessee’s mine maps and cross sections (with the results of drilling shown thereon), (ii) reports of the tonnage of all Taconite shipped to any concentrating plant and the results of any operations involving Taconite in the said concentrating plant, and (iii) statements of the estimated tonnage of all Merchantable Iron Ore, Concentrates, Taconite, Concentratable Ore and any other iron-bearing materials mined from the Premises and stockpiled thereon or elsewhere, it being understood that all such information shall be such as the Lessee customarily obtains for its own records and Lessee shall not be required to compile special reports or statements for such

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purposes; provided, however, that, subject to the above requirements, the Lessee may, from time to time and when and as it deems it desirable, use and employ such methods of mining, treating, concentrating or beneficiating any or all of the ores and iron-bearing materials in or derived from the Premises as it may desire or find most profitable or economical.

Section 2. Royalty

The Lessee shall on the 20th day of January, April, July and October of each and every year, herein referred to as “quarter days”, or on or before the day ensuing if that day falls on Sunday or a holiday, so long as this Agreement continues in force, pay to the Lessors in the following name and address: Trustees, Great Northern Iron Ore Properties, W-2081 First National Bank Building, St. Paul, Minnesota 55101, or such other place in the United States as Lessors shall from time to time designate in writing, for all Merchantable Iron Ore, Concentrates and Taconite derived from the Premises which shall be by the Lessee shipped as herein provided, during the three (3) months preceding the first day of the month in which such payment is to be made as aforesaid (each such period being herein called the “calendar quarter”), royalty at the following respective rates per ton:

A. For each ton of Merchantable Iron Ore or Concentrates, a sum equal to   ***   , which amount shall be subject to increase in the same proportion that the Producer Price Index for All Commodities (with 1967 equal to 100 as a base), published by the Bureau of Labor Statistics of the U.S. Department of Labor, formerly referred to as the Wholesale Price Index (hereinafter called the “Index”) or any successor Federal agency publishing such Index increases for the first month of the calendar quarter (i.e., for January, April, July or October, as the case

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may be) in which Merchantable Iron Ore or Concentrates are shipped exceeds the January, 1977 Wholesale Price Index level of 188.0;

B. For each ton of Taconite, a sum calculated as follows:

(1) The base royalty, except as provided in subparagraph (2) below of this Paragraph B shall be   ***   per ton of Oxide Pellets as increased by   ***   of the sum of the additional amounts per ton determined in accordance with subparagraphs (a) and (b) below.

(a) Reference shall be made to the Producer Price Index for All Commodities (with 1967 equal 100 as a base), published by the Bureau of Labor Statistics of the United States Department of Labor, or any successor Federal agency publishing such index (hereinafter called “the Index”), for the second month in such calendar quarter (i.e., for February, May, August or November, as the case may be). If the Index for such month shall exceed the January, 1977 Wholesale Price Index of 188.0, the excess shall be computed and the result multiplied by   ***   . For example, if the Index increased to 210.4 for August, 1978, the additional amount for the calendar quarter of July, August, and September of 1978 would be computed as follows:

***

(b) If the prevailing Lake Erie market price per iron unit of Lake Superior District Oxide Pellets of type, grade and character similar to those being produced in the trade as of the date hereof delivered

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to rail of vessel at Cleveland, Ohio, as published in Iron Age or as otherwise provided in Paragraph C below of this Section 2, shall exceed the price of $   ***   per unit of iron, an additional amount shall be determined, which shall be the difference between $   ***   multiplied by 64 (deemed iron content per ton), and said prevailing Lake Erie market price multiplied by 64, and the difference, if any, multiplied by   ***   . For example, if such prevailing Lake Erie market price at Cleveland, Ohio, was increased to $   ***   per unit, the amount would be computed as follows:

Price Per Iron Unit	$	***	$	***
64 Iron Units Per Ton	x	64	x	64
Price Per Ton of pellets	$	***	$	***

Difference
$	***
	***
$	***
x	***
$	***

(2) Anything hereinabove contained to the contrary notwithstanding, for the period of this Agreement prior to January 1, 1992, the base royalty with respect to each ton of Oxide Pellets produced from Taconite shipped from  ***  (hereinafter called “initial base royalty”) shall be  ***  plus  ***  of the amount by which the base royalty determined as provided in subparagraph 2 B(1) exceeds  ***  . If, prior to 1992,   ***   is economically exhausted by the shipment of Taconite producing less than  

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***   tons of Oxide Pellets, determined in accordance with subparagraph 2 B(3) hereof, then the foregoing initial base royalty shall apply to shipments of Taconite from any of the Premises until January 1, 1992 or   ***   tons of Oxide Pellets are produced, whichever occurs first.

(3) The base royalty pursuant to subparagraph (1) or the initial base royalty pursuant to subparagraph (2) above shall be converted to a Taconite basis as follows:

For each quarter year in which Taconite is mined hereunder, the conversion factor shall be based upon Lessee’s plant operations in such quarter year and shall be a ratio determined by dividing the total number of tons of Oxide Pellets produced from the plant or plants in which Taconite from the Premises is concentrated by the total number of tons of Taconite from the Taconite Lands processed in such plant or plants to produce such tonnages of Oxide Pellets during such quarter year. For purposes of the foregoing sentence, tonnages of Oxide Pellets shall include Taconite Concentrates produced but not pelletized, the tonnages of which shall be the number of tons of Oxide Pellets which could be expected to result from the pelletizing of such Taconite Concentrates, provided, however, that Taconite Concentrates making up customary in-plant surge piles shall be excluded. The conversion factor multiplied by the base royalty or the initial base royalty, as the case may be, shall be the royalty on Taconite for the quarter year. If the final figures required to make the computations necessary to compute the royalty in each quarter

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on the above basis are not available, the most reasonable figures available shall be used and such royalty shall be adjusted to the final tonnages and recovery at the end of each calendar year and an appropriate adjustment based on such information made to the Lessors not later than January 20th of the next calendar year with the royalty statement required by such date.

C.            In the event some period other than 1967 is used as a base of 100 in determining the Index for the purpose of computing the escalation amount, such Index shall be adjusted so as to be in correct relationship to such 1967 base. In the event such Index is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the Index during any period subsequent to March, 1978, it being intended to substitute an index which most accurately reflects fluctuations in the prices of all commodities in the manner presently reported by the Index. If the parties hereto cannot agree upon a substitute index which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.

If the prevailing Lake Erie market price of Lake Superior District iron ore pellets published in Iron Age shall change in various issues of Iron Age published during a calendar quarter, such market price as published in the last issue of that calendar quarter shall be employed for the purpose of making the royalty adjustment provided herein for such calendar quarter. If prices quoted in such last issue of Iron Age indicate there is in effect more than one bona fide Lake Erie market price, then the arithmetical average of all of the prices quoted by all

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of the companies shown as quoting a price in such issue as being in effect at that time shall be deemed the prevailing Lake Erie market price.

If Iron Age shall cease publication, or shall cease to publish such prevailing market price of Lake Superior District iron ore pellets delivered to rail of vessel at Cleveland, Ohio, or shall be in error and such price shall be published by some other publication generally accepted in the trade as reliable, then quotations of such price as published by such other publication shall be accepted and employed for the purpose of making the royalty adjustment hereinabove provided. If, and for so long as, such prevailing price of iron ore pellets delivered at Cleveland as aforesaid shall not be published in Iron Age or in another publication accepted as aforesaid, then this agreement shall nevertheless continue in full force and effect, and the parties hereto shall determine by mutual agreement another method or formula to be used until such published price may again be available and which will produce as nearly as may be the same rates of royalty as would have prevailed under a continuation of such publication of such prices. If such published price ceases to be available and the parties hereto fail within a reasonable time to agree upon such new method or formula for the adjustment of royalty rates hereunder, the same shall be determined by arbitration in the manner hereinafter provided.

D.        Royalties paid on Taconite shipped hereunder include the value of tailings derived from such Taconite and any such tailings so derived shall be the property of Lessee, provided, however, that if any of such tailings shall be sold, Lessors will be paid   ***   of the proceeds of such sale, after deduction of all costs and expenses of Lessee attributable to such sale.

E.         If Lessee shall produce on the Taconite Lands Reduced Pellets or Partially Reduced Pellets rather than or in addition to Oxide Pellets from iron-bearing material mined from the Premises, or if Lessee shall encounter in the Premises mineral in economically

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mineable quantities which Lessee wishes to remove and treat and for which no royalty rate is provided in this Agreement, Lessee shall notify Lessors thereof and the parties hereto shall promptly thereafter attempt to agree upon a base royalty for Reduced Pellets or Partially Reduced Pellets or a royalty rate for said mineral, as the case may be, but a failure to agree shall not be subject to arbitration, nor shall such a failure suspend or invalidate this Agreement nor the rights and privileges of Lessee herein.

Section 3. Minimum Royalty

For each year during which this Agreement shall continue in effect and regardless of whether Lessee shall conduct on the Premises any mining or other operations, Lessee, subject to the provisions hereinafter contained, shall pay to Lessors as minimum royalty or rent for and with respect to such year for the Premises and the rights and privileges granted hereby, a minimum payment of a sum computed at the following rates:

A) ***   with respect to calendar year 1979; and

B) ***   with respect to each calendar year thereafter, subject to escalation as hereinafter provided.

The amount of minimum royalty payable with respect to each calendar year shall be escalated as to minimums to be paid commencing in 1981 by multiplying the minimum royalty payable by a fraction, the numerator of which is the base royalty on Oxide Pellets for the last calendar quarter of the year immediately preceding the year in which such minimum royalty is payable and the denominator of which is the base royalty for the last calendar quarter of 1979. For example, if the base royalty as of December 31, 1979 is $   ***  , and as escalated to the last quarter of 1980 is $  ***, the amount of minimum royalty payable for the first quarter of 1981 and each of the three succeeding calendar quarters would be calculated as follows:

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Base annual minimum for 1981			=	$   ***
Base quarterly minimum for 1981			=	$   ***
1981 quarterly escalated minimum			=
$   ***   x	$  ***	÷ 4 =
	$   ***		$   ***

If, at any time after the first calendar year of this Agreement, the accumulated tonnage of Taconite shipped plus the tonnage paid for in minimum royalty in excess of the minimum royalty used and applied in satisfaction of earned royalty hereunder shall exceed the equivalent of 40 million tons of Oxide Pellets, then commencing with the next full calendar quarter and for the remaining term hereof the minimum royalty payable hereunder shall be an amount equal to  ***of the amount otherwise payable as minimum royalty as determined in accordance with the preceding two paragraphs. To determine the total number of tons of Oxide Pellets paid for by such excess minimum royalty, such excess minimum royalty shall be divided by the royalty rate on Oxide Pellets in effect in the calendar quarter for which such determination is made.

The annual minimum royalty or rent shall be paid in quarterly installments on the 20th day of January, April, July and October in each year, each installment being for the calendar quarter preceding the quarter in which such payment date falls.

The minimum royalty payment for the calendar quarter in which termination of this Agreement occurs, if such termination occurs other than on the last day of such quarter, shall be that proportion of the minimum royalty payment due for such quarter which the number of days from the first day of such quarter to the effective date of termination bears to the total number of days in such quarter.

When and if for any calendar year, Lessee shall have paid to Lessors as minimum royalty or earned royalty or both an amount equal to four times the minimum royalty payment due for

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the first calendar quarter of such year, then and in that event there shall be no minimum royalty payment required for any subsequent calendar quarter of that year.

If earned royalty payable by Lessee for any calendar quarter shall be less than the amount of the minimum royalty payment for the calendar quarter, determined as hereinabove provided, Lessee shall pay Lessors on the quarter day immediately following such quarter, an additional sum equal to the difference between such earned royalty for such calendar quarter and the minimum royalty payment for such calendar quarter and such additional sum (hereinafter called “prepaid royalty”) shall be considered an advance or prepayment of earned royalty on subsequent shipments.

Lessee shall have the right to apply any prepaid royalty, including the prepaid royalty in the amount of   ***   existing on the date of this Agreement, in any subsequent calendar quarter of the same or any subsequent calendar year to the extent required or so far as the same will go in satisfaction of the amount of earned royalty payable by Lessee for any such quarter which is in excess of the minimum royalty payment for such calendar year. Notwithstanding anything to the contrary contained in the foregoing sentence, on the date on which the Trust shall terminate and cease existence, any prepaid royalty credit then existing hereunder shall be considered liquidated and cancelled, provided that any minimum royalty payable after such date shall continue to apply in satisfaction of any earned royalty payable hereunder during the balance of the term of this Agreement. In addition, during the three (3) calendar years immediately preceding the year in which the Trust shall terminate and cease existence, Lessee shall have the right to apply and credit any earned royalty paid hereunder during any of the said three (3) calendar years in excess of minimum royalty toward the satisfaction of any minimum royalty otherwise payable for the period commencing with the start of the said three (3) calendar years and ending on the date on

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which the Trust shall so terminate and cease. For purposes of the immediately preceding sentence, minimum royalties payable during such period shall be calculated at the escalated minimum royalty rate applicable at the commencement of said period, and as of the date of the termination of the Trust minimum royalties payable thereafter shall be calculated as escalated in accordance with the second paragraph of this Section 3.

Section 4. Weights

In the event that Merchantable Iron Ore, Concentrates or Taconite are shipped from the Premises by a common carrier railroad company, the Merchantable Iron Ore, Concentrates or Taconite so shipped shall (except as hereinafter provided) be weighed separately by the railroad company transporting the same, which weights shall determine the quantities as between the parties hereto. In the event that Merchantable Iron Ore, Concentrates or Taconite are shipped from the Premises, by means other than a common carrier railroad company, the weights of the Merchantable Iron Ore, Concentrates or Taconite so shipped shall (except as hereinafter provided) be determined separately by weighing upon belt scales or other weighing devices of standard design customarily used on the Mesabi Range in similar practices, or by such other means as may be mutually agreed upon between the parties hereto, and the weights so obtained shall be prima facie evidence between the parties hereto of the amounts so taken. If Taconite from the Premises is intermingled before weighing with Taconite from other lands, the tonnage shipped shall be determined by a count of uniformly loaded vehicles or units (which vehicles or units shall at all times be of uniform size, or in any event of a known capacity, so that accurate accounting of the quantity of material transported thereby can always be made) from the Premises and from said other lands and by allocation of the combined weights determined by such belt scales or other weighing devices upon the basis of such vehicle or unit count, or by

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such other means as may be mutually agreed upon between the parties hereto. Lessors shall at any and all reasonable times have free access to and right of inspection of any such belt scales or other weighing devices, and may make such tests to verify the accuracy thereof as they may desire and any variance, discrepancy or inaccuracy discovered in such belt scales or other weighing devices shall be promptly corrected by Lessee and any differences arising therefrom shall be promptly adjusted and settled. Lessee shall as promptly as possible after the end of each calendar month supply Lessors with its statement as to all weights obtained by such belt scales or other weighing devices during the preceding calendar month, specifying separately the tonnage of Merchantable Iron Ore, Concentrates and Taconite. Lessee will cause any common carrier railroad company transporting any ore mined from the Premises promptly to furnish to Lessors the usual and customary written certificates showing the true weight of the various classifications of ore so transported over its lines of railroad and giving the number and weight of each car and the place from which shipped, so that Lessors may accurately determine the weights and identity of each grade of the various classes of said ore so produced and shipped from the Premises. Said written certificates, when properly certified by the agent of the railroad company furnishing the same shall be prima facie evidence of all facts therein stated.

Section 5. Reports

The Lessee, at the time of each quarterly payment of royalty, shall transmit to the Lessors a true and accurate statement showing for the preceding calendar quarter the following, to-wit:

(a) The tonnage and analysis of Merchantable Iron Ore and Concentrates, respectively, mined from the Premises and shipped during such quarter;

(b) The tonnage and analysis of all Concentratable Ore mined from the Premises taken to any treating plant during such quarter and the results of any operations

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involving the said ore in the said treating plant, including tonnage and iron unit recovery and analyses of Concentrates and tailings;

(c) The total tonnage and classification of Taconite and iron-bearing material mined from the Premises and stockpiled or shipped during such quarter;

(d) The indices, factors, tonnages and calculations essential to make the determinations specified in Section 2 of this Article IV.

The royalty statement transmitted for the fourth calendar quarter of each year shall include or be accompanied by an accurate statement of the total number of tons of Taconite processed in such year in the Lessee’s plant or plants from all sources and the total number of tons of Oxide Pellets (including the natural iron content thereof) produced from such Taconite in such year.

The Lessee will also furnish to the Lessors annually, if requested, an accurate statement and report of exploration and development work upon the Premises during the preceding year and at least a quarter-portion of all exploration samples, and, when requested by the Lessors in writing, a quarter-portion of mine or mill samples.

Section 6. Taxes

The Lessee shall pay all lawful taxes and assessments, general and specific, ordinary and extraordinary which may be lawfully imposed, levied or assessed upon any and all of the Premises and on the Merchantable Iron Ore, Concentratable Ore, Concentrates, Taconite, Oxide Pellets and other iron-bearing material in which Lessors retain an interest taken or derived therefrom, and on all improvements and personal property thereon and on all royalty paid by it to the Lessors pursuant to this Agreement while this Agreement shall remain in force with respect thereto, but excluding any taxes upon or measured by the net income of Lessors, and shall

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furnish the Lessors with duplicate receipts promptly after Lessee obtains them, showing the payment of all such assessments and taxes; provided, however, that the Lessee shall always have the right to contest in the courts or otherwise the validity of any such taxes or assessments in case the same shall be claimed to be unlawful, unjust, unequal or excessive, or to take such other steps or proceedings as may be necessary to secure a cancellation, reduction, readjustment or equalization thereof before the Lessee shall be required to pay and discharge the same or any part thereof; but provided further that the Lessee shall not permit or suffer the Premises or any part thereof or any Merchantable Iron Ore, Concentratable Ore, Concentrates, Taconite and Oxide Pellets from the Premises or any improvements or personal property thereon, to be sold at any time for any such taxes or assessments.

Section 7. Liens

While this Agreement shall remain in force, the Lessee shall protect the Premises and all improvements thereon and iron-bearing material mined thereon or concentrates derived therefrom and not sold and disposed of in due course of business or shipped therefrom, from all mechanics’ and laborers’ liens and shall keep the title to the same free and clear from all clouds or encumbrances on account of, or in any manner arising from, the mining operations conducted hereunder or the use and occupancy hereunder of the Lessee or the agents, servants, or employees of the Lessee, and the Lessee shall protect, indemnify and save harmless the Lessors from claims, actions and liability of whatever kind, arising from the operations of the Lessee in its work or mining under the provisions of this Agreement.

Section 8. Indemnity

Lessee shall do and perform, or refrain from doing, with respect to the Premises, whatever may be legally required to comply with all valid laws, ordinances, regulations, rules,

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orders, and requirements (now existing or hereafter enacted, adopted, or made during the term hereof) of any and all federal, state, county, and municipal authorities having jurisdiction over the manner in which Lessee conducts its mining operations in, or use of, the Premises (including the use of other lands in connection therewith), including specifically, but not exclusively, mine land reclamation; control of stockpiling of surface overburden or iron formation materials, and of tailings basins (location, erosion, vegetation, terracing or other practical controls); stabilization of open pit embankments; and air, water, and solid waste pollution. The termination of this Agreement for any reason shall not release Lessee from any liability accrued prior to such termination, and the Lessee shall erect such proper fences or guard rails with respect to all shafts, pits, caves and other openings and excavations upon or encompassing the Premises as will be adequate and sufficient to prevent persons, vehicles and animals from falling into the same, and shall leave the surrendered Premises, as a result of its operations or business hereunder, in such condition as will not constitute a nuisance to persons and adjacent property, and as will fully comply with all valid laws, ordinances, regulations, rules, orders and requirements then existing of any and all governmental authorities having jurisdiction over the conditions in which lands are left at the termination of mining operations. Lessee agrees to defend and save harmless Lessors, except to the extent of Lessors’ negligence or contributory negligence, from expense for any liability for personal injury, property damage or orders or penalties imposed by governmental authority arising out of the acts or omissions of Lessee in its mining or use of the Premises. This indemnity shall expire five years from the date of the expiration or termination of this Agreement and during such five years, Lessors shall give Lessee reasonable written notice of any such alleged claims and an opportunity to contest same.

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ARTICLE V

CONTROVERSY NOT TO SUSPEND RIGHTS

The uninterrupted right of the Lessee to the use of the Premises and to exercise the rights and privileges herein provided for shall continue unsuspended notwithstanding any controversy or disagreement between the parties hereto respecting the same, provided the Lessee shall duly pay all royalties which may accrue on shipments and minimum royalty or rent at the time or times and in the manner stipulated in and by this Agreement.

ARTICLE VI

INSPECTION BY LESSORS

Lessors, or their duly authorized agents and employees, shall at all times have the right to enter upon the Premises or stockpile grounds to inspect or survey the same, provided they shall not thereby unnecessarily or unreasonably hinder or interrupt the operation of the Lessee.

Lessors or their representative(s), as Lessors shall authorize in writing to Lessee, shall have the right to enter any plant of the Lessee in which ore or Taconite from the Premises is beneficiated for the purpose of inspection of operations in such a manner as will not unreasonably interfere with said operations and as will comply with mine safety laws and regulations.

ARTICLE VII

TERMINATION BY LESSORS

If the royalties or the minimum royalty or rent provided for remain unpaid after the time above specified, or if the Lessee shall fail to keep any of the other conditions and covenants herein expressed to be performed or observed by the Lessee, and if either such failure shall continue for sixty (60) days after the receipt by the Lessee of written notice from the Lessors,

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specifying any such failure, then and from thenceforward it shall be lawful for the Lessors to declare this Agreement terminated and the rights of the Lessee hereunder forfeited; provided, however, that if the Lessee shall deny the failure alleged by the Lessors and shall demand arbitration thereof in the manner hereinafter provided, the period required for the hearing and determination of such matter by the arbitrators shall not be deemed a part of said sixty (60) days hereinbefore referred to; and if the contention of the Lessors be sustained by the arbitrators, the Lessee shall have sixty (60) days after the issuance of the decision by the arbitrators in which to correct the failure complained of.

ARTICLE VIII

NOTICES

All payments, reports, statements, and notices required or permitted to be made and transmitted to the Lessors by the Lessee may be made or given by depositing the same in the United States mail, postage prepaid, addressed to the Lessors at their address hereinbefore referred to, or at such other address as the Lessors may from time to time designate in writing, and all notices and communications authorized to be given by the Lessors to the Lessee shall be addressed to the Lessee at 1100 Superior Avenue, Cleveland, Ohio, 44114, or at such other address as the Lessee may from time to time designate in writing; but any notice of termination or default shall be effective only on actual delivery by certified mail or otherwise.

ARTICLE IX

TERMINATION BY LESSEE

The Lessee shall have the right at any time, and from time to time, upon one year’s notice in writing, to terminate this Agreement in its entirety, such notice to be given in the manner provided in Article VIII above; and in such case this Agreement shall terminate in its entirety

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one (1) year after the giving of such notice by the Lessee, provided that all of the covenants, agreements and conditions hereof obligatory upon the Lessee, including payment of all minimum royalty or rent and the royalties, if any, and other sums that may have accrued and become payable hereunder (except current taxes required to be paid by the Lessee but not then due and payable, which must and will be paid by the Lessee within ten (10) days after they become due and payable), shall have been fully kept, observed and performed by the Lessee; and upon any such surrender or termination of this Agreement, the Lessee may, and upon the written request of the Lessors shall, promptly execute and record, in any public office where the aforementioned indenture of lease may have been filed or recorded, an appropriate form of release and discharge.

ARTICLE X

SURRENDER AND REMOVAL

Upon the termination of this Agreement, by expiration of time, or otherwise, the Lessee shall peacefully surrender possession of the Premises to the Lessors; and thereafter the Lessee shall have six (6) months in which to remove all engines, tools, machinery, railway tracks, shaft houses, buildings, dwellings or structures and all other property of every nature and description erected or placed by it upon the Premises so surrendered, except any and all supports placed in any shafts, drifts, or openings upon the Premises, or any timber or framework necessary to the use and maintenance of shafts or approaches to mines or tramways within mines, none of which shall be so removed by the Lessee; provided always, however, that none of said property may be so removed by the Lessee unless all payments of taxes (except taxes not then due and payable), royalties and other amounts payable hereunder shall have been made and all other covenants, agreements and conditions hereof obligatory upon the Lessee shall have been fully and faithfully observed and performed. Any such property not removed within the six (6) month period shall

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become the property of Lessors, or Lessors may remove the same and be reimbursed by Lessee for the cost thereof, provided such removal is completed and such reimbursement is requested of Lessee within twelve (12) months after the expiration of Lessee’s six (6) month period of removal.

ARTICLE XI

LIEN OF LESSORS

The Lessors shall at all times have and hold a lien upon all iron ore and iron-bearing material (or any concentrates or products thereof) mined from the Premises but not shipped, and upon all improvements placed upon the Premises by the Lessee, as security for any unpaid balance of money due hereunder, and as security for the performance by the Lessee of each and all of the covenants and conditions hereof obligatory upon the Lessee. Nothing herein contained with reference to the creation of a lien as above described shall prevent the sale and removal of said iron ore, iron-bearing material, concentrates or products in the usual course of Lessee’s business, nor the removal of any other property at any time when said Lessee shall not be in default; and the above referred to lien shall not, in case of sales of ore, concentrates or products to third parties, be deemed to follow the ore, concentrates or products as against such third parties.

ARTICLE XII

CROSS MINING RIGHTS

In the conduct of mining operations on the Premises, the Lessee shall have the right, if it so desires, to mine and remove any of the iron ore or iron-bearing material existing upon the Premises, on, over or through, any adjoining or other property, and may, in accordance with good engineering practices then in effect on the Mesabi Range, place or store the iron ore and

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iron-bearing material (or any concentrates or products thereof) from the Premises upon any other property owned or controlled by the Lessee. The Lessee may also, if it so desires, use the Premises, or any part thereof, and any shafts, openings, pits, plants and stockpile grounds sunk or made thereon, for the mining, removal, treatment and storing of any iron ore or iron-bearing material (or any concentrates or products thereof) from any adjoining or other property, or for any purpose or purposes connected therewith. The removal of iron ore or iron-bearing material (or any concentrates or products thereof) from the Premises under the provisions of this Article shall not be treated as a mining and shipment to require the payment of royalty thereon, and royalty thereon shall accrue only when the same are weighed and shipped from such other property; provided, however, that until such weighing and shipment, the rights and liens of the Lessors in and to such iron ores, iron-bearing material (or any concentrates or products thereof), including but not limited to the right of ingress to and egress from the lands on which iron ore and iron-bearing material (or concentrates or products thereof) is stored, shall be preserved and protected by the recognition thereof by the owners of such other property to which same may be removed for a period of at least five (5) years after the termination of the leasehold rights of the Lessee in and to such other property; and the Lessors hereby agree to and do and will recognize for a period of five (5) years after the termination of this Agreement with respect to the Premises so used, the rights and liens of the owners of such other lands in and upon any ores, concentrates or products therefrom which may be handled over, or placed, or stored upon any part of the Premises. Should any iron ore or iron-bearing material (or any concentrates or products thereof) of Lessors be stored upon lands in Lessee’s possession, Lessee shall, to the extent the Lessee has title thereto, before conveying or otherwise transferring any of such lands to other parties or at the termination of this Agreement, transfer title to any of such lands to Lessors or shall give to

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the Lessors in writing the right to enter upon the lands and to remove its material so long as any such material is stored thereon.

The Lessee may also deposit any stripping or waste material from the Premises upon any adjoining or other lands and may deposit any stripping or waste material from any adjoining or other lands upon the Premises, but only at a location on the Premises approved by Lessors and in such manner as will not interfere with any future mining operations on the Premises.

ARTICLE XIII

BENEFICIATION

Taconite and Concentratable Ore upon which royalty may accrue or be payable hereunder, may be treated on or off the Premises. If Lessee desires to treat Taconite on the Premises, it may construct at a convenient and proper location as mutually agreed upon the Premises a suitable plant or plants for properly treating such Taconite. Lessee shall also have the right, at its election, and when and in any manner it sees fit, to wash, jig, screen, sinter or otherwise treat, beneficiate or concentrate any Concentratable Ore taken from the Premises and for that purpose such Concentratable Ore may be removed to a plant or plants established or maintained either upon the Premises or elsewhere upon lands owned or controlled by Lessee, and iron ore or iron-bearing material from adjoining or other property may be beneficiated, concentrated or otherwise treated in any such plant or plants as may be established or maintained on the Premises.

With respect to tailings resulting from the concentration, beneficiation or treatment of Concentratable Ore, Lessee shall have and is hereby granted the right to commingle in common deposit tailings resulting from the concentration or treatment of Concentratable Ore from the Premises with tailings resulting from the concentration or treatment of Concentratable Ore

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removed from any adjoining or other property, it being understood and agreed, however, that Lessors shall have no right, title or interest in tailings which have been produced from the treatment of Taconite on which Lessee shall have paid the royalties herein provided. Lessee shall keep accurate track and record separately of the quantities before concentration or treatment of all such Concentratable Ores either by weighing the same upon belt scales or other weighing devices of standard design customarily used on the Mesabi Range in similar practices, or by the use of uniformly sized cars or other containers or measuring devices uniformly filled or by such other mutually agreed methods, and the tailings commingled in any tailings basin as hereinbefore provided shall be divided and allocated among the parties contributing thereto on the basis of the quantities of the Concentratable Ores from the various properties contributing thereto. Lessee, upon termination of this Agreement, shall, by a good and sufficient instrument, grant and convey to the Lessors their respective ownership in the aggregate of such tailings from Concentratable Ore deposited in any such tailings basin, together with a perpetual easement for the removal thereof, reserving to itself, however, all such proportions, if any, as may be owned by it and the right to continue to deposit in such tailings basin tailings resulting from the treatment of ores removed from other lands.

It is further understood and agreed that in order to facilitate the operations of the Lessee in any such plant or plants so established or operated either upon the Premises or other lands owned or leased by the Lessee, the Lessee may, if it so desires, mix any Taconite or Concentratable Ore from the Premises with Taconite or Concentratable Ore of a similar character from any other property or properties within the Taconite Lands now or hereafter owned or leased by Lessee prior to the beneficiation, concentration or treatment thereof; provided, however, that in case and so long as the Lessee shall exercise such rights to mix such materials it

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shall, as to Taconite or Concentratable Ore going into each such plant or plants, keep accurate track and record separately of the quantity of the Taconite or Concentratable Ore from the Premises going into such mixture, and of the quantity of Taconite or Concentratable Ore from other properties going into such mixtures, either by weighing the same before mixing, or by the use of uniform-sized cars or other containers or measures or other mutually agreed methods; and in such event the Concentrates resulting from the treatment of such Concentratable Ore shall be conclusively deemed to have been derived from the Premises and from such other lands in the proportion in which the quantity of Concentratable Ore from the Premises used in such mixture bears to the total quantity of Concentratable Ore contained in such mixture.

If Taconite is to be commingled after having been weighed, but before shipment, the Lessee shall cause the quantity and character thereof to be carefully and accurately determined so that the respective interests of Lessors in such commingled material shall at all times be ascertainable and shall at all times be protected to the end that Lessors shall receive when due, the same amount of royalty for its proportion of such commingled material, as nearly as possible, as it would have received if such material had not been commingled and had been beneficiated, stockpiled and shipped separately.

For any quarter year in which the Lessee shall have exercised its rights to so mix Taconite or Concentratable Ore from the Premises with those from other lands prior to the completion of their beneficiation, concentration or shipment, the report by the Lessee to the Lessors, for such quarter, as required by Section 5 of Article IV, shall also show separately, and for each classification of ores upon which royalty is to be paid, the following:

(a) The total weight of the Concentrates or Oxide Pellets made from such mixed ores or materials in such quarter; and

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(b) The weight or measured units (i.e., number of cars) of –

(1) the Taconite or Concentratable Ore derived from the Premises; and

(2) the Taconite or Concentratable Ore derived from other lands, so going into the production of such Concentrates or Oxide Pellets; and

(c) The weight or amount of such Concentrates assigned as derived from the Premises as provided in this Article.

ARTICLE XIV

MATERIALS FROM PRIOR OPERATIONS

Iron-bearing material resulting from the treatment of Concentratable Ore and lean ore deposited in stockpiles and tailings basins on the Premises or parts thereof pursuant to the Mahoning Lease prior to this Agreement are included under this Agreement for the term hereof. Certain tonnages of iron ore derived from the Premises are, as of the date hereof, in stockpile on the North Half of the North Half of the Southwest Quarter (N½-N½-SW¼) of Section Thirty-Five (35), the North Half of the Northeast Quarter of the Southeast Quarter (N½-NE¼-SE¼) of Section Thirty-Four (34), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) of Section Thirty-Five (35), Township Fifty-Eight (58) North, Range Twenty-One (21) West, and the Northwest Quarter of the Northeast Quarter (NW¼-NE¼) of Section Ten (10), Township Fifty-Seven (57) North, Range Twenty-One (21) West, Minnesota. The agreement dated May 20, 1913 between West Missabe Land Co. and Lessee, the agreement dated May 19, 1947 between Grant Iron Mining Company and Lessee, and the agreement dated December 1, 1950 between Grant Iron Mining Company and Lessee, all of which govern such stockpiles on the above lands, are terminated and superseded by the provisions hereof. The provisions hereof shall also govern that stockpile situated on the Northeast Quarter of the Southwest Quarter

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(NE¼-SW¼) and the Northwest Quarter of the Southeast Quarter (NW¼-SE¼), both in Section Thirty-Four (34), Township Fifty-Eight (58) North, Range Twenty-One (21) West, known as the “Midget Dump.”

Lessee shall have the right to remove such iron ore from stockpile and the removal and commingling thereof shall be included as being within the ordinary course of mining or grading out for the purposes of this Agreement.

ARTICLE XV

ARBITRATION

In case any disagreement or controversy shall arise between the parties hereto relative to the observance or fulfillment of the terms and obligations hereof by either party, then such controversy or disagreement shall be determined by arbitration. Either party may within thirty (30) days after such disagreement arises demand arbitration thereof and the party or parties making such demand shall in writing specify the matter to be submitted to arbitration and at the same time choose and nominate some disinterested competent person to act as an arbitrator; thereupon within twenty (20) days after receipt of such written notice the other party to this Agreement shall in writing choose and nominate a disinterested and competent arbitrator and the two arbitrators so chosen shall forthwith select a third arbitrator, giving written notice to both parties of the choice so made and fixing a place and time for meeting not later than thirty (30) days thereafter, at which both parties may appear and be heard touching such controversy. The decision of said arbitrators shall be made in writing within thirty (30) days after the completion of hearings thereon, and when signed by a majority of them shall be final and conclusive upon both parties, and the award so made shall be forthwith complied with. In case the notified party shall neglect or refuse to choose and nominate an arbitrator as above provided and within the

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time hereinabove specified, then the party demanding arbitration shall have the right to name the second arbitrator. In case the two chosen by either of the above methods shall fail to agree upon a third arbitrator and give notice as herein provided, such third arbitrator shall, upon the application of either party, be named by the person who may then be holding the Office of Chief Judge of the United States District Court in and for the district in which Duluth, Minnesota, is located, or the person holding an office which corresponds to such office as now extant if it shall then have been abolished. The expense of any such arbitration, including reasonable compensation for the arbitrators, shall be paid by the party against which the award therein shall be made, or as otherwise determined by the arbitrators.

ARTICLE XVI

HEADINGS

The captions appearing at the head of the articles and sections of this Agreement are inserted for convenient reference purposes only and are not to be considered in the interpretation and construction of this Agreement.

ARTICLE XVII

ASSIGNMENT

Neither this Agreement nor the Premises hereunder may be assigned, in whole or in part, without prior written consent of the Lessors, which consent shall not unreasonably be withheld; provided, however, that (1) Lessee may, contemporaneously with the execution of this Agreement, assign undivided interests in this Agreement to the participants in Hibbing Taconite Company, a joint venture consisting of Bethlehem Steel Corporation, a Delaware corporation, Pickands Mather & Co., a Delaware corporation, Hibbing Development Company, a Minnesota partnership, and Ontario Hibbing Company, a Minnesota corporation; (2) the above-named

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participants in the said joint venture may from time to time assign any portion of their interest hereunder as among themselves, to reflect changes in their interests in said joint venture; (3) any or all of said participants may assign from time to time any interest hereunder to an assignee or assignees whose liabilities hereunder are guaranteed by the assignor or whose financial capability is demonstrated to the reasonable satisfaction of Lessors to be sufficient to meet its liabilities under this Agreement; and (4) any or all of said participants may subject its or their interests herein to the lien of a mortgage or pledge to the extent necessary in order to secure such financing as may be needed to bring the Premises into production or to refinance expenditures made to bring the Premises into production.

ARTICLE XVIII

SUCCESSORS AND ASSIGNS

This Agreement shall extend to, inure to the benefit of and be binding upon the respective successors and assigns of the parties hereto; subject, however, to the provisions of Article XVII hereof.

ARTICLE XIX

INSOLVENCY

If the Lessee, during the term hereof, shall be adjudged insolvent or bankrupt, or shall seek the protection of any insolvency or bankruptcy acts or laws, or make any assignment for the benefit of its creditors, or if any execution be issued or attachment levied against it or any of its effects whatsoever, and such execution or attachment shall not be discharged, removed, vacated or bonded within sixty (60) days from the receipt of written demand from the Lessors to so discharge, remove, vacate or bond such execution or attachment, then in each and every event:

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(a) The royalties for all Merchantable Iron Ore, Concentrates and Taconite theretofore shipped from the Premises and not theretofore paid for shall forthwith and immediately become due and payable, any provision herein contained to the contrary notwithstanding; and

(b) The right of the Lessee to remove or ship or take away Merchantable Iron Ore, Concentrates and Taconite from the Premises shall, upon written notice from Lessors, be and remain suspended and no Merchantable Iron Ore, Concentrates or Taconite shall thereafter be shipped, removed or taken away from the Premises by the Lessee or any receiver of anyone claiming under this Agreement, unless and until all royalties for such ore theretofore shipped and all sums payable hereunder, including all taxes, assessments and governmental charges hereinagreed to be paid by the Lessee and then payable, shall have been paid, and, during the period that bankruptcy or insolvency shall continue, no Merchantable Iron Ore, Concentrates or Taconite shall be shipped from the Premises unless and until all royalties thereon shall have first been paid and all other sums due and payable shall have been paid or, to the satisfaction of the Lessors, secured to be paid; and

(c) If the Lessee, or any receiver or representative of Lessee, or anyone claiming under it, shall violate the conditions contained in subdivisions (a) or (b) of this paragraph, the Lessors shall have the right to terminate and cancel this Agreement subject to and upon the terms and conditions hereinafter provided, and it shall expire and all rights of the Lessee, or any receiver or representative of the Lessee, or anyone claiming under it, shall terminate sixty (60) days after the service upon the Lessee, or the receiver of the Lessee, by the Lessors, as herein provided, of a

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written notice specifying the particular default complained of, unless such default shall have been remedied within such sixty (60) day period; and the Lessors shall, at the expiration of said sixty (60) day period, if such default be not then remedied, be entitled to the immediate possession of the Premises and to institute any suitable proceeding or action to obtain possession of the Premises, and the expiration of this Agreement, at the end of such notice provided for, shall be in the same manner and have the same effect as if it were the expiration by lapse of time of the term therein demised; and

(d) All liens on any property, wheresoever situated, in this Agreement provided and given, shall continue in full force and effect notwithstanding any termination of this Agreement, until the full and complete satisfaction of all the terms herein contained.

The rights reserved by the Lessors under this paragraph shall be in addition to and not in derogation of the rights vested in the Lessors elsewhere in this Agreement.

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IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of the day and year first above written.

/s/ William W. Watson
William W. Watson
/s/ Louis W. Hill, Jr.
Louis W. Hill, Jr.
/s/ Harry L. Holtz
Harry L. Holtz
/s/ Joseph S. Micallef
Joseph S. Micallef
Trustees under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties.
MAHONING ORE AND STEEL
PARTNERSHIP (Bethlehem Steel
Corporation as General Partner)
By	/s/ Robert M. McCann
	Vice President
Attest	/s/ R. G. Masters
	Assistant Secretary

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STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared WILLIAM W. WATSON, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared LOUIS W. HILL, JR., Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

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STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared HARRY L. HOLTZ, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

STATE OF MINNESOTA	)
	:	SS.
COUNTY OF RAMSEY	)

On this 9th day of June, 1981, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, Trustee under that certain Trust Agreement executed December 7, 1906, by and between Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as Great Northern Iron Ore Properties; to me known to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed as such Trustee.

/s/ Carole D. Lockrem

Notary Public

My commission expires June 26, 1987

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STATE OF PENNSYLVANIA	)
	:	SS.
COUNTY OF LEHIGH	)

On this 24th day of July, 1981, before me, a Notary Public within and for said County and State, personally appeared ROBERT M. McCANN and R. G. MASTERS to me personally known, who being each by me duly sworn, did depose and say that they are respectively the Vice President and Assistant Secretary of Bethlehem Steel Corporation, a general partner of Mahoning Ore and Steel Partnership, the partnership named in the foregoing instrument, and that said instrument was signed in behalf of the partnership by authority of its Management Committee and as the free act and deed of said partnership.

/s/ Beverly A. DeFubic

Notary Public

My commission expires January 7, 1985

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ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS AGREEMENT made and entered into as of the first day of January, 1979, among MAHONING ORE AND STEEL PARTNERSHIP, a Minnesota partnership (hereinafter referred to as “Assignor”), and BETHLEHEM STEEL CORPORATION, a Delaware corporation, PICKANDS MATHER & CO., a Delaware corporation, HIBBING DEVELOPMENT COMPANY, a Minnesota partnership, and ONTARIO HIBBING COMPANY, a Minnesota corporation, as tenants in common, BETHLEHEM to the extent of an undivided Fifty Per Cent (50%) interest, PICKANDS MATHER to the extent, of an undivided Ten Per Cent (10%) interest, HIBBING DEVELOPMENT COMPANY to the extent of an undivided Thirty-three and three thousand three hundred and thirty-three ten thousands Per Cent (33.3333%) interest, and ONTARIO HIBBING to the extent of an undivided Six and six thousand six hundred and sixty-seven ten thousands Per Cent (6.6667%) interest (Bethlehem, Pickands Mather, Hibbing Development Company and Ontario Hibbing being hereinafter referred to collectively as “Assignees”).

W I T N E S S E T H:

Assignor, for and in consideration of the covenants and agreements hereof to be kept and performed by Assignees, does hereby assign, transfer and set over unto Assignees all of its right, title and interest in, to and under that certain Agreement and that certain Indenture of Lease, each dated as of January 1, 1979 between Trustees, Great Northern Iron Ore Properties, lessors, and Assignor as lessee, under which Assignor has the right to mine iron-ore bearing material in accordance with the terms and provisions thereof upon the lands leased which consist of the

following described premises situated in St. Louis County, and Itasca County, State of Minnesota:

In St. Louis County;

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-Seven (57) North of Range Twenty-one (21) West, St. Louis County;

In Itasca County;

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼), of Section Twenty-Seven (27); Township Fifty-Seven (57) North of Range Twenty-Two (22) West, Itasca County.

including among such right, title and interest the right to take credit for advance minimum royalty payments heretofore paid by Assignor or Assignor’s predecessor in interest and subject to all restrictions, reservations, licenses, easements and other such limitations as recited in said Agreement and Indenture of Lease and such reservations of Assignor as are provided in an agreement of even date between the parties hereto relating to the payment of royalties.

Assignor hereby represents to, and covenants and agrees with, Assignees that Assignor has duly and faithfully kept, performed and observed the terms, covenants, conditions,

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provisions, restrictions and obligations to be performed by Assignor and accruing under the Agreement and Indenture of Lease prior to the date hereof.

Assignees hereby covenant and agree with Assignor that Assignees shall, and each of them hereby does, assume and agree duly and faithfully to keep, perform and observe the terms, covenants, conditions, provisions, restrictions and obligations to be performed by Assignor and accruing under the Agreement and Indenture of Lease from and after the date hereof.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written by their respective officers thereunto duly authorized.

		MAHONING ORE AND STEEL PARTNERSHIP
Attest:	/s/ R. G. Masters	By	BETHLEHEM STEEL CORPORATION
	Assistant Secretary		A General Partner
		By	/s/ Robert M. McCann
			Vice President
		BETHLEHEM STEEL CORPORATION
Attest:	/s/ R. G. Masters	By	/s/ Robert M. McCann
	Assistant Secretary		Vice President
			PICKANDS MATHER & CO.
Attest:	/s/ R. F. Oldenberg	By	/s/ H. P. Whaley

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		ONTARIO HIBBING COMPANY
Attest:	/s/ [illegible]	By	/s/ G. H. G. Layt
		HIBBING DEVELOPMENT COMPANY
		By	Pickands Mather & Co., a General Partner
Attest:	/s/ R. F. Oldenberg	By	/s/ H. P. Whaley
			Vice President
		By
			Vice President

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STATE OF Pennsylvania	)
	)	SS.
COUNTY OF Lehigh	)

The foregoing instrument was acknowledged before me this 29th day of July, 1981, by ROBERT M. McCANN and R. G. MASTERS of Bethlehem Steel Corporation, a general partner of MAHONING ORE AND STEEL PARTNERSHIP, the partnership named in the foregoing instrument, and that said instrument was signed in behalf of the partnership by authority of its Management Committee and as the free act and deed of said partnership.

/s/ Ethel H. Vary

Notary Public

My commission expires July 17, 1982

COMMONWEALTH OF PENNSYLVANIA	)
	)	SS.
COUNTY OF LEHIGH	)

The foregoing instrument was acknowledged before me this 29th day of July, 1981, by ROBERT M. McCANN, Vice President, of BETHLEHEM STEEL CORPORATION, a Delaware corporation, on behalf of the corporation.

/s/ Ethel H. Vary

Notary Public

My commission expires July 17, 1982

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STATE OF OHIO	)
	)	SS.
COUNTY OF CUYAHOGA	)

The foregoing instrument was acknowledged before me this 24th day of August, 1981, by H. P. WHALEY, Vice President, of PICKANDS MATHER & CO., a Delaware corporation, on behalf of the corporation.

/s/ Kathleen M. Schupp

Notary Public

My commission expires August 26, 1981

PROVINCE OF ONTARIO	)
	)	SS.
MUNICIPALITY OF METROPOLITAN TORONTO	)

The foregoing instrument was acknowledged before me this 20th day of August, 1981, by G. H. G. Layt, Vice President, of ONTARIO HIBBING COMPANY, a Minnesota corporation, on behalf of the corporation.

/s/ [illegible]

Notary Public

My commission expires ________________________.

at the pleasure of the Crown.

-6-

STATE OF Ohio

COUNTY OF Cuyahoga

The foregoing instrument was acknowledged before me this 24th day of August, 1981, by H. P. WHALEY, Vice President of Pickands Mather & Co., a General Partner, of HIBBING DEVELOPMENT COMPANY, the partnership named in the foregoing instrument and that said instrument was signed in behalf of the partnership by authority of its Management Committee and as the free act and deed of said partnership.

/s/ Kathleen M. Schupp

Notary Public

My commission expires August 26, 1981

-7-

ASSIGNMENT OF INTEREST

UNDER MAHONING INDENTURE OF LEASE

AND MAHONING AGREEMENT

THIS ASSIGNMENT, dated as of the 1st day of February, 1981, from BETHLEHEM STEEL CORPORATION, a Delaware corporation (hereinafter called the “Assignor”),

TO

BETHLEHEM HIBBING CORPORATION, a Minnesota corporation (hereinafter called the “Assignee”),

W I T N E S S E T H :

WHEREAS, by an Indenture of Lease (the “Lease”) and by an Agreement (the “Agreement”) each dated January 1, 1979, the Trustees of Great Northern Iron Ore Properties leased to Mahoning Ore and Steel Partnership, a Minnesota partnership, certain lands described hereinbelow; and

WHEREAS, by an Assignment and Assumption Agreement dated January 1, 1979, said Mahoning Ore and Steel Partnership assigned to the Assignor, to Pickands Mather & Co., a Delaware corporation, to Hibbing Development Company, a Minnesota partnership, and to Ontario Hibbing Company, a Minnesota corporation, as tenants in common, all of its right, title and interest in, to and under the Lease and the Agreement, the Assignor to the extent of an undivided fifty percent (50%) interest, said Pickands Mather & Co. to the extent of an undivided ten percent (10%) interest, said Hibbing Development Company to the extent of an undivided thirty-three and three thousand three hundred thirty-three ten thousandths percent (33.3333%) interest, and said Ontario Hibbing Company to the extent of an undivided six and six thousand six hundred sixty-seven ten thousandths percent (6.6667%) interest; and

WHEREAS, the Assignee has requested that the Assignor assign to it the Assignor’s leasehold estate under said Assignment and Assumption Agreement, and the Assignor is willing so to do;

NOW, THEREFORE, the Assignor, for and in consideration of the covenants and agreements hereof to be kept and performed by the Assignee, does hereby assign, transfer and set over to the Assignee all of the Assignor’s undivided fifty percent (50%) interest as Assignee under said Assignment and Assumption Agreement dated as of January 1, 1979, which interest is in respect of the following described premises (hereinafter called the “Assigned Premises”), located partly in St. Louis County and partly in Itasca County, in the State of Minnesota:

In St. Louis County;

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE 1/4 - SW 1/4), the Southeast Quarter of the Southwest Quarter (SE 1/4 – SW 1/4), the Northwest Quarter of the Southeast Quarter (NW 1/4 - SE 1/4) and the North Half of the Southwest Quarter of the Southeast Quarter (N 1/2 - SW 1/4 - SE 1/4) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE 1/4 - SE 1/4) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW 1/4 - NE 1/4), the Northwest Quarter of the Southeast Quarter (NW 1/4 - SE 1/4) and the Southwest Quarter of the Southeast Quarter (SW 1/4 - SE 1/4) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW 1/4 -NE 1/4) and the Southeast Quarter of the Northeast Quarter (SE 1/4 - NE 1/4) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE 1/4 - NE 1/4), the Northeast Quarter of the Northwest Quarter (NE 1/4 – NW 1/4), the Northwest Quarter of the Northwest Quarter (NW 1/4 - NW 1/4), the Southwest Quarter of the Northwest Quarter (SW 1/4 - NW 1/4), the Southeast Quarter of the Northwest Quarter (SE 1/4 - NW 1/4) and the Northwest Quarter of the Southwest Quarter (NW 1/4 - SW 1/4) of Section Ten (10), Township Fifty-Seven (57) North of Range Twenty-One (21) West, St. Louis, County;

In Itasca County;

The Southeast Quarter of the Southwest Quarter (SE 1/4 -SW 1/4), of Section Twenty-Seven (27); Township Fifty-Seven (57) North of Range Twenty-Two (22) West, Itasca County.

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TOGETHER WITH all of the mining rights, easements, licenses and rights of way which are appurtenant to the Assigned Premises and are held by the Assignor under or pursuant to the said Assignment and Assumption Agreement, together with the Assignor’s prorata interest in the right to take credit for recoverable minimum royalty payments made pursuant to the Lease.

The Assignee hereby accepts said Assignment and agrees to comply, from and after the date hereof, with all of the terms and provisions of the Agreement, the Lease and the Assignment and Assumption Agreement which are binding upon the Assignor including, but not limited to, the terms and provisions thereof concerning the payment of all royalties, taxes and other sums which are to be paid by the assignees thereunder.

The Assignor shall give notice of this assignment to the other parties to the said Assignment and Assumption Agreement and shall give notice to them that the address of the Assignee is:

Bethlehem Hibbing Corporation

Attention: Secretary

Bethlehem, Pennsylvania 18016.

The provisions hereof shall run with the Assigned Premises and shall be binding upon, and shall enure to the benefit of, the parties hereto and their successors and assigns.

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            IN WITNESS WHEREOF, the parties hereto have executed this Assignment as of the day and year first above written.

	BETHLEHEM STEEL CORPORATION,
ATTEST:	by
/s/ R. G. Masters	/s/ Robert M. McCann
Assistant Secretary	Vice President
	BETHLEHEM HIBBING CORPORATION,
ATTEST:	by
/s/ R. G. Masters	/s/ H. J. Ashe
Assistant Secretary	Vice President

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COMMONWEALTH OF PENNSYLVANIA	)
	:	SS.
COUNTY OF LEHIGH	)

The foregoing instrument was acknowledged before me this 29th day of July, 1981, by Robert M. McCann, a Vice President of BETHLEHEM STEEL CORPORATION, a Delaware corporation, on behalf of the corporation.

/s/ Ethel H. Vary

Notary Public

My Commission Expires July 17, 1982

COMMONWEALTH OF PENNSYLVANIA	)
	:	SS.
COUNTY OF LEHIGH	)

The foregoing instrument was acknowledged before me this 29th day of July, 1981, by H. J. Ashe, a Vice President of BETHLEHEM HIBBING CORPORATION, a Minnesota corporation, on behalf of the corporation.

/s/ Ethel H. Vary

Notary Public

My Commission Expires July 17, 1982

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THIS INDENTURE, made and entered into this 19th day of March, 1993, but effective as of January 1, 1993, by and between:

HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES,

parties of the first part, hereinafter referred to as “Lessors;” and

BETHLEHEM HIBBING CORPORATION, a Minnesota corporation (to the extent of an undivided 50% interest), CLIFFS MINING COMPANY, a Delaware corporation formerly known as Pickands Mather & Co. (to the extent of an undivided 10% interest), ONTARIO HIBBING COMPANY, a Minnesota corporation (to the extent of an undivided 6.6667% interest) and HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership (to the extent of an undivided 33.3333% interest); which entities are collectively known as HIBBING TACONITE JOINT VENTURE,

parties of the second part, hereinafter referred to as “Lessee,”

W I T N E S S E T H

WHEREAS, by an Indenture of Lease and Operating Agreement, each dated as of January 1, 1979, the Lessors, or their respective predecessor Trustees, granted to the Lessee, or its predecessor Mahoning Ore and Steel Partnership, a Minnesota partnership, a leasehold estate, until and including December 31, 2026, in the following described tracts or parcels of land situated in the State of Minnesota described as follows:

In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three

(3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-seven (57) North of Range Twenty-one (21) West, St. Louis County;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼), of Section Twenty-seven (27); Township Fifty-seven (57) North of Range Twenty-two (22) West, Itasca County;

which tracts or parcels of land are hereinafter referred to as the “Premises;” and,

WHEREAS, it is mutually desired by the Lessors and the Lessee to amend said Indenture of Lease and Operating Agreement as to certain particulars;

NOW, THEREFORE, in consideration of the Premises and of the respective benefits to accrue to each of them by the making of this agreement, the parties hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1979, shall be and hereby is amended March 19, 1993, but effective as of January 1, 1993, in the following particulars only, and not otherwise, to-wit:

Article IV, Section 2., entitled “Royalty,” of the Operating Agreement is amended by adding the following Section F. at the end of said Article IV, Section 2.:

“F. Notwithstanding the above royalty rate calculation and for the sole purpose of determining an earned royalty rate for the ten-year period 1993 through 2002, said earned royalty rate for each ton of Taconite shipped from the Premises, except for *** , shall be the product resulting from multiplying (i) *** , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup for the quarterly

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calculation period, as defined within this Article IV, Section 2.F. hereof, to the February 1993 Producer Price Index for the Iron and Steel Subgroup, by (iii) the conversion factor, as defined in Article IV, Section 2.B.(3) hereinbefore, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly Calculation Period) x Conversion Factor

(February 1993 PPI I/S   =   113.0 )

Notwithstanding the above royalty rate calculation and for the sole purpose of determining an earned royalty rate for the ten-year period 1993 through 2002, said earned royalty rate for each ton of Taconite shipped from   ***  , shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup for the quarterly calculation period, as defined within this Article IV, Section 2.F. hereof, to the February 1993 Producer Price Index for the Iron and Steel Subgroup, by (iii) the conversion factor, as defined in Article IV, Section 2.B.(3) hereinbefore, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly Calculation Period) x Conversion Factor

(February 1993 PPI I/S   =   113.0 )

For purposes of this Article IV, Section 2.F., the Producer Price Index for the Iron and Steel Subgroup (PPI I/S), to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) of the quarter in which shipments are made. For example: The PPI I/S for February would be used to calculate the royalty on shipments made in the first calendar quarter.

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.

(1) For the five-year period encompassing the years 1993, 1994, 1995, 1996 and 1997, Lessee guarantees to produce not less than   ***   of the total Taconite shipped from Taconite Lands for each and every year from the demised Premises and not less than   ***   of the total Taconite shipped

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from Taconite Lands for said five-year period from the demised Premises. Lessee further guarantees to produce not less than   ***   of the aforesaid   ***   for said five-year period from   ***  . A deficiency of any or all of the aforementioned production guarantees shall become a liability of the Lessee payable to the Lessor in accordance with the terms set forth in the following subparagraphs (a), (b) and (c), each liability independently calculated:

(a) In the event Lessee produces less than   ***   of the total Taconite shipped from Taconite Lands, for any reason whatsoever, from the demised Premises for each and every year during said five-year period ending 1997, the Lessee shall be liable to the Lessors for the production deficiency as of the end of each year in which the production deficiency occurred at the calculated earned royalty rate then in effect for the fourth quarter of that year in which the production deficiency occurred, as defined within the first paragraph of Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, of the year succeeding the production deficiency.

(b) In the event Lessee produces less than   ***   of the total Taconite shipped from Taconite Lands, for any reason whatsoever, from the demised Premises during said five-year period ending 1997, the Lessee shall be liable to the Lessors for the production deficiency as of the end of 1997 at the calculated earned royalty rate then in effect for the fourth quarter of 1997, as defined within the first paragraph of Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, 1998.

(c) In the event Lessee produces less than   ***   of the   ***   , as described in Article IV, Section 2.F.(1) above, for any reason whatsoever, from *** during said five-year period ending 1997, the Lessee shall be liable to the Lessors for the production deficiency as of the end of 1997 at the calculated earned royalty rate then in effect for the fourth quarter of 1997, as defined within Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, 1998.

(2) For the five-year period encompassing the years 1998, 1999, 2000, 2001 and 2002, Lessee guarantees to produce not less than   ***   of the total Taconite shipped from Taconite Lands for each and every year from the demised Premises and not less than   ***   of the total Taconite shipped from Taconite Lands for said five-year period from the demised Premises. Lessee further guarantees to produce not less than   ***   of the aforesaid

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***   for said five year period from   ***  . A deficiency of any or all of the aforementioned production guarantees shall become a liability of the Lessee payable to the Lessor in accordance with the terms set forth in the following subparagraphs (a), (b) and (c), each liability independently calculated:

(a) In the event Lessee produces less than   ***   of the total Taconite shipped from Taconite Lands, for any reason whatsoever, from the demised Premises for each and every year during said five-year period ending 2002, the Lessee shall be liable to the Lessors for the production deficiency as of the end of each year in which the production deficiency occurred at the calculated earned royalty rate then in effect for the fourth quarter of that year in which the production deficiency occurred, as defined within the first paragraph of Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, of the year succeeding the production deficiency.

(b) In the event Lessee produces less than   ***   of the total Taconite shipped from Taconite Lands, for any reason whatsoever, from the demised Premises during said five-year period ending 2002, the Lessee shall be liable to the Lessors for the production deficiency as of the end of 2002 at the calculated earned royalty rate then in effect for the fourth quarter of 2002, as defined within the first paragraph of Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, 2003.

(c) In the event Lessee produces less than   ***   of the   ***   , as described in Article IV, Section 2.F.(2) above, for any reason whatsoever, from *** during said five-year period ending 2002, the Lessee shall be liable to the Lessors for the production deficiency as of the end of 2002 at the calculated earned royalty rate then in effect for the fourth quarter of 2002, as defined within Article IV, Section 2.F. hereof. For purposes of the immediately preceding sentence, said liability shall be payable January 20, 2003.”

The first paragraph of Article IV, Section 2. is further amended by changing the Lessors’ address to:

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“Trustees, Great Northern Iron Ore Properties

W-1290 First National Bank Building

St. Paul, Minnesota 55101-1361.”

All other notices which are to be sent to the Lessors shall be sent to this revised address.

All other terms and conditions of the Indenture of Lease and Operating Agreement, including the provisions stated in Article IV, Section 3., entitled “Minimum Royalty,” are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument in multiple counterparts, all of which will be considered one and the same agreement, as of the day and year first above written, but effective as of January 1, 1993.

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GREAT NORTHERN IRON ORE PROPERTIES

/s/ Harry L. Holtz

Harry Holtz

/s/ Joseph S. Micallef

Joseph S. Micallef

/s/ Roger W. Staehle

Roger W. Staehle

/s/ Robert A. Stein

Robert A. Stein

All as Trustees as aforesaid

STATE OF MINNESOTA	)
	)
COUNTY OF RAMSEY	)

On this 17th day of June, 1993, before me, a Notary Public within and for said County and State, appeared HARRY L. HOLTZ, JOSEPH S. MICALLEF, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument for the uses and purposes therein mentioned.

/s/ Rose M. Tester

Notary Public

My commission expires 10-15-98

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BETHLEHEM HIBBING CORPORATION
By	/s/ A. A. Zimmerman
Attest	/s/ Stephen J. Selden

STATE OF Pennsylvania	)
	)
COUNTY OF Lehigh	)

On this 14th day of June, 1993, before me, a Notary Public within and for said County and State, personally appeared A. A. Zimmerman, the President of BETHLEHEM HIBBING CORPORATION, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Lynn L. Deppe

Notary Public

My commission expires Dec. 27, 1993

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CLIFFS MINING COMPANY
By	/s/ Thomas J. O’Neil
	Senior Vice President - Technical
Attest	/s/ J. E. Lenhard

STATE OF OHIO	)
	)
COUNTY OF CUYAHOGA	)

On this 29th day of June, 1993, before me, a Notary Public within and for said County and State, personally appeared Thomas J. O’Neil the Sr. Vice President of CLIFFS MINING COMPANY, a Delaware corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Shaner

Notary Public

My commission expires May 21, 1994

-9-

ONTARIO HIBBING COMPANY
By	/s/ A. S. Mackenzie
Attest	/s/ [illegible]

PROVINCE OF ONTARIO	)
	)
DOMINION OF CANADA	)

On this 14th day of June, 1993, before me, a Notary Public within and for said Province and Dominion, personally appeared A. S. MACKENZIE the President of ONTARIO HIBBING COMPANY, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the corporation, and acknowledged that he executed the same as his free act and deed.

/s/ J.A. B. John

Notary Public

My commission expires at the Pleasure of the Crown

-10-

HIBBING DEVELOPMENT COMPANY By Pickands Hibbing Corporation
By	/s/ Thomas J. O’Neil
	Vice President
Attest	/s/ J. E. Lenhard
	Secretary

STATE OF OHIO	)
	)
COUNTY OF CUYAHOGA	)

On this 29th day of June, 1993, before me, a Notary Public within and for said County and State, personally appeared T. J. O’Neil, Vice President of Pickands Hibbing Corporation, a general partner of HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership, to me known to be the person described in and who executed the foregoing instrument on behalf of the general partnership, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Shaner

Notary Public

My Commission Expires May 21, 1994

-11-

THIS INDENTURE, made and entered into this 1st day of November, 2000, by and between:

JOSEPH S. MICALLEF, HARRY L. HOLTZ, ROGER W. STAEHLE and ROBERT A. STEIN, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES,

parties of the first part, hereinafter referred to as “Lessors;” and

BETHLEHEM HIBBING CORPORATION, a Minnesota corporation (to the extent of an undivided 50% interest), CLIFFS MINING COMPANY, a Delaware corporation formerly known as Pickands Mather & Co. (to the extent of an undivided 10% interest), ONTARIO HIBBING COMPANY, a Minnesota corporation (to the extent of an undivided 6.6667% interest) and HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership (to the extent of an undivided 33.3333% interest); which entities are collectively known as HIBBING TACONITE JOINT VENTURE,

parties of the second part, hereinafter referred to as “Lessee.”

W I T N E S S E T H

WHEREAS, by an Indenture of Lease dated January 1, 1979 and an Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, the Lessors, or their respective predecessor Trustees, granted to the Lessee, or its predecessor Mahoning Ore and Steel Partnership, a Minnesota partnership, a leasehold estate, until and including December 31, 2026, in the following described tracts or parcels of land situated in the State of Minnesota described as follows:

In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest

Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-seven (57) North, Range Twenty-one (21) West;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼) of Section Twenty-seven (27), Township Fifty-seven (57) North, Range Twenty-two (22) West;

which tracts or parcels of land are hereinafter referred to as the “Premises;” and

WHEREAS, it is mutually desired by the Lessors and the Lessee to further amend said Operating Agreement as to certain particulars.

NOW, THEREFORE, in consideration of the Premises and of the respective benefits to accrue to each of them by the making of this Amendment, the parties hereby agree unto and with each other that the said Operating Agreement dated as of January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, shall be and hereby is further amended and effective as of January 1, 2000, in the following particulars only, and not otherwise, to-wit:

ARTICLE IV (LESSEE’S COVENANTS), Section 1., entitled “Operations,” is amended by adding the following paragraphs at the end of this Section:

“The parties acknowledge that a railroad track has been constructed, and is being used by Burlington Northern Inc., over a strip of land (hereinafter called the “Track Lands”) which is across that part of the Premises described as the

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Southwest Quarter of the Northeast Quarter (SW¼-NE¼) of Section Nine (9), in Township Fifty-seven (57) North, Range Twenty-one (21) West, St. Louis County, Minnesota, and they acknowledge further, that in order to permit the mining of the Track Lands, the railroad track will have to be moved. It is agreed that the Lessee shall not forego the mining of the Track Lands merely because of the expense involved in moving the railroad track; and it is further agreed that the Lessors will permit the filling and grading of mined out areas of the Premises to the extent necessary for the proper relocation of the railroad tracks.

The parties further acknowledge that a county road (St. Louis County) will be constructed, for public use, over a strip of land (hereinafter called the “Road Lands”) which is across that part of the Premises described as the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) of Section Nine (9), in Township Fifty-seven (57) North, Range Twenty-one (21) West, St. Louis County, Minnesota, and they acknowledge further, that in order to permit the mining of the Road Lands, the county road will have to be moved. It is agreed that the Lessee shall not forego the mining of the Road Lands merely because of the expense involved in moving the county road; and it is further agreed that the Lessors will permit the filling and grading of the mined out areas of the Premises to the extent necessary for the proper relocation of the county road.”

All other terms and conditions of the Indenture of Lease and Operating Agreement, as amended, are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument in multiple counterparts, all of which will be considered one and the same agreement, as of the day and year first above written.

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LESSORS:

GREAT NORTHERN IRON ORE PROPERTIES

/s/ Joseph S. Micallef

Joseph S. Micallef

/s/ Harry L. Holtz

Harry L. Holtz

/s/ Roger W. Staehle

Roger W. Staehle

/s/ Robert A. Stein

Robert A. Stein

All as Trustees as aforesaid

STATE OF MINNESOTA	)
	) ss.
COUNTY OF RAMSEY	)

On this 14th day of December, 2000, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, HARRY L. HOLTZ, ROGER W. STAEHLE and ROBERT A. STEIN, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument on behalf of the Trust, and acknowledged that they executed the same as their free act and deed.

/s/ Rose M. Tester

Notary Public

My Commission Expires 1-31-05

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LESSEE:
BETHLEHEM HIBBING CORPORATION
By	/s/ J. P. Krum
	President
Attest	/s/ E. J. Dindorf

STATE OF Pennsylvania	)
	) ss.
COUNTY OF Lehigh	)

On this 20th day of November, 2000, before me, a Notary Public within and for said County and State, personally appeared J. P. Krum the President of BETHLEHEM HIBBING CORPORATION, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Marian J. Seifert

Notary Public

My Commission Expires June 22, 2002

-5-

LESSEE:
CLIFFS MINING COMPANY
By	/s/ E. C. Dowling
	Senior Vice President
Attest	/s/ J. E. Lenhard

STATE OF Ohio	)
	) ss.
COUNTY OF Cuyahoga	)

On this 10th day of November, 2000, before me, a Notary Public within and for said County and State, personally appeared E. C. Dowling the Senior Vice President of CLIFFS MINING COMPANY, a Delaware corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Rindfleisch

Notary Public

My Commission Expires May 21, 2004

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LESSEE:
ONTARIO HIBBING COMPANY
By	/s/ Brian Warry
Attest	/s/ J. A. B. John

PROVINCE OF ONTARIO	)
	) ss.
DOMINION OF CANADA	)

On this 27th day of November, 2000, before me, a Notary Public within and for said Province and Dominion, personally appeared BRIAN WARRY the President of ONTARIO HIBBING COMPANY, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ J. A. B. John

Notary Public

My Commission Expires at the pleasure of the Crown

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LESSEE:
HIBBING DEVELOPMENT COMPANY By Pickands Hibbing Corporation
By	/s/ E. C. Dowling
	Senior Vice President
Attest	/s/ J. E. Lenhard

STATE OF Ohio	)
	) ss.
COUNTY OF Cuyahoga	)

On this 10th day of November, 2000, before me, a Notary Public within and for said County and State, personally appeared E. C. Dowling, the Sr. Vice President of Pickands Hibbing Corporation, a general partner of HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership, to me known to be the person described in and who executed the foregoing instrument on behalf of the Partnership, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Rindfleisch

Notary Public

My Commission Expires May 21, 2004

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THIS INDENTURE, made and entered into this 30^th day of January, 2003, but effective as of January 1, 2003, by and between:

JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES,

parties of the first part, hereinafter referred to as “Lessors;” and

BETHLEHEM HIBBING CORPORATION, a Minnesota corporation (to the extent of an undivided 50% interest), CLIFFS MINING COMPANY, a Delaware corporation formerly known as Pickands Mather & Co. (to the extent of an undivided 10% interest), ONTARIO HIBBING COMPANY, a Minnesota corporation (to the extent of an undivided 6.6667% interest) and HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership (to the extent of an undivided 33.3333% interest); which entities are collectively known as HIBBING TACONITE JOINT VENTURE,

parties of the second part, hereinafter referred to as “Lessee.”

W I T N E S S E T H

WHEREAS, by an Indenture of Lease dated January 1, 1979 and an Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993 and later amended by that certain document dated November 1, 2000, but effective January 1, 2000 (hereinafter collectively referred to as the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to the Lessee, or its predecessor Mahoning Ore and Steel Partnership, a Minnesota partnership, a leasehold estate, until and including December 31, 2026, in the following described tracts or parcels of land situated in the State of Minnesota described as follows:

In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the

foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-seven (57) North, Range Twenty-one (21) West;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼) of Section Twenty-seven (27), Township Fifty-seven (57) North, Range Twenty-two (22) West;

which tracts or parcels of land are hereinafter referred to as the “Premises;” and

WHEREAS, it is mutually desired by the Lessors and the Lessee to further amend said Operating Agreement as to certain particulars.

NOW, THEREFORE, in consideration of the Premises and of the respective benefits to accrue to each of them by the making of this Amendment, the parties hereby agree unto and with each other that the said Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, and later amended by that certain document dated November 1, 2000, but effective January 1, 2000, shall be and hereby is further amended as of January 30, 2003, but effective January 1, 2003, in the following particulars only, and not otherwise, to-wit:

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ARTICLE IV (LESSEE’S COVENANTS), Section 2., entitled “Royalty,” is amended by adding the following Section G. and Section H. at the end of said Article IV, Section 2.:

“G. Notwithstanding the above, for the three-year period 2003 through 2005, the royalty rate for each ton of Taconite shipped from the Premises shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.G. hereof, to the November 2002 Producer Price Index for the Iron and Steel Subgroup, by (iii) the conversion factor, as defined in Article IV, Section 2.B.(3) hereinbefore, said royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period) x Conversion Factor

(November 2002 PPI I/S = 117.9)

In no event shall the product derived from multiplying (i) by (ii), as defined within this Article IV, Section 2.G. hereof, be less than   ***  .

For purposes of this Article IV, Section 2.G., the Producer Price Index for the Iron and Steel Subgroup (PPI I/S), to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) immediately preceding the quarter in which shipments are made. For example: The PPI I/S for February would be used to calculate the royalty on shipments made in the second calendar quarter.

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in a correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.

H. Notwithstanding the above, beginning with the calendar year 2006 and continuing for the remaining term of the Indenture of Lease and Operating Agreement, the royalty rate for each ton of Taconite shipped from the Premises shall be the product resulting from multiplying (i) *** , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.H. hereof, to the November

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2005 Producer Price Index for the Iron and Steel Subgroup, by (iii) the conversion factor, as defined in Article IV, Section 2.B.(3) hereinbefore, said royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period) x Conversion Factor

(November 2005 PPI I/S)

For purposes of this Article IV, Section 2.H., the Producer Price Index for the Iron and Steel Subgroup (PPI I/S), to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) immediately preceding the quarter in which shipments are made. For example: The PPI I/S for February would be used to calculate the royalty on shipments made in the second calendar quarter.

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in a correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.”

ARTICLE IV (LESSEE’S COVENANTS), Section 3., entitled “Minimum Royalty,” is amended by inserting the following paragraphs before the third full paragraph of said Article IV, Section 3.:

“Notwithstanding the above, for the three-year period 2003 through 2005, the minimum royalty shall be *** for each calendar year (2003, 2004 and 2005).   ***.

Notwithstanding the above, beginning with the calendar year 2006 and continuing for the remaining term of the Indenture of Lease and Operating Agreement, the minimum royalty shall be the product resulting from multiplying (i)   ***  , hereinafter referred to as the “Base Minimum Royalty,” by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 3. hereof, to the November 2005 Producer Price Index for the Iron and Steel Subgroup, said minimum royalty to be calculated to two decimal places. For example:

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$   *** x   (PPI I/S Qtrly. Calculation Period)

(November 2005 PPI I/S)

For purposes of this Article IV, Section 3., the Producer Price Index for the Iron and Steel Subgroup (PPI I/S), to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) immediately preceding the quarter for which minimum royalty is due. For example: The PPI I/S for February would be used to calculate the minimum royalty due for the second quarter, payable on the 20^th day of July.

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in a correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.”

ARTICLE IV (LESSEE’S COVENANTS), Section 5., entitled “Reports,” is amended by adding the following paragraph at the end of said Article IV, Section 5.:

“The Lessee shall furnish to the Lessors, upon written request from Lessors, mining projections from the Premises. Mining projections shall include tonnage and maps, of reasonable scale, which outline the areas from which the mining projections were derived. The maps shall be prepared according to engineering standards used at Hibbing Taconite.”

ARTICLE XII (CROSS MINING RIGHTS) is amended by inserting the words “in such manner as will not interfere with any future mining operations on the Premises” in the first paragraph, 12^th line down, after the word “property” of said Article XII.

All other terms and conditions of the Indenture of Lease and Operating Agreement, as amended, are hereby ratified and affirmed.

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IN WITNESS WHEREOF, the parties have duly executed this instrument in multiple counterparts, all of which will be considered one and the same agreement, as of the day and year first above written, but effective as of January 1, 2003.

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LESSORS:

GREAT NORTHERN IRON ORE PROPERTIES

/s/ Joseph S. Micallef

Joseph S. Micallef

/s/ Roger W. Staehle

Roger W. Staehle

/s/ Robert A. Stein

Robert A. Stein

/s/ John H. Roe, III

John H. Roe, III

All as Trustees as aforesaid

STATE OF MINNESOTA	)
	) ss.
COUNTY OF RAMSEY	)

On this 19th day of May, 2003, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument on behalf of the Trust, and acknowledged that they executed the same as their free act and deed.

/s/ Linda J. Bergen

Notary Public

My Commission Expires 1-31-2006

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LESSEE:
BETHLEHEM HIBBING CORPORATION
By	/s/ Stephen J. Selden
Attest	/s/ Lynda M. Reeman

STATE OF PENNSYLVANIA	)
	) ss.
COUNTY OF Lehigh	)

On this 22nd day of April, 2003, before me, a Notary Public within and for said County and State, personally appeared Stephen J. Selden the Secretary of BETHLEHEM HIBBING CORPORATION, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Judy C. Wuchter

Notary Public

My Commission Expires Mar. 19, 2006

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LESSEE:
CLIFFS MINING COMPANY
By	/s/ E. C. Dowling, Jr.
	Senior Vice President
Attest	/s/ J. E. Lenhard
	Vice President, Secretary and General Counsel

STATE OF Ohio	)
	) ss.
COUNTY OF Cuyahoga	)

On this 16th day of April, 2003, before me, a Notary Public within and for said County and State, personally appeared E. C. Dowling the Sr. Vice President of CLIFFS MINING COMPANY, a Delaware corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Rindfleisch

Notary Public

My Commission Expires May 21, 2004

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LESSEE:
ONTARIO HIBBING COMPANY
By	/s/ B. W. Warry
Attest	/s/ J. A. B. John

PROVINCE OF ONTARIO	)
	) ss.
DOMINION OF CANADA	)

On this 14th day of April, 2003, before me, a Notary Public within and for said Province and Dominion, personally appeared B. W. WARRY the President of ONTARIO HIBBING COMPANY, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ J. A. B. John

Notary Public

My Commission Expires at the pleasure of the Crown.

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LESSEE:
HIBBING DEVELOPMENT COMPANY By Pickands Hibbing Corporation
By	/s/ E. C. Dowling, Jr.
	E. C. Dowling, Jr., Senior Vice President
Attest	/s/ J. E. Lenhard
	J. E. Lenhard, Secretary

STATE OF Ohio	)
	) ss.
COUNTY OF Cuyahoga	)

On this 16th day of April, 2003, before me, a Notary Public within and for said County and State, personally appeared E. C. Dowling, the Sr. Vice President of Pickands Hibbing Corporation, a general partner of HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership, to me known to be the person described in and who executed the foregoing instrument on behalf of the Partnership, and acknowledged that he executed the same as his free act and deed.

/s/ Lucille E. Rindfleisch

Notary Public

My Commission Expires May 21, 2004

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THIS INDENTURE, made and entered into this 1^st day of October, 2003, but effective as of January 1, 2004, by and between:

JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES,

parties of the first part, hereinafter referred to as “Lessors;” and

HIBBING TACONITE HOLDING INC., a Minnesota corporation (to the extent of an undivided 50% interest), CLIFFS MINING COMPANY, a Delaware corporation formerly known as Pickands Mather & Co. (to the extent of an undivided 10% interest), ONTARIO HIBBING COMPANY, a Minnesota corporation (to the extent of an undivided 6.6667% interest) and HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership (to the extent of an undivided 33.3333% interest); which entities are collectively known as HIBBING TACONITE JOINT VENTURE,

parties of the second part, hereinafter referred to as “Lessee.”

W I T N E S S E T H

WHEREAS, by an Indenture of Lease dated January 1, 1979 and an Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993 and further amended by that certain document dated November 1, 2000, but effective January 1, 2000, and further amended by that certain document dated January 30, 2003, but effective January 1, 2003 (hereinafter collectively referred to as the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to the Lessee, or its predecessor Mahoning Ore and Steel Partnership, a Minnesota partnership, a leasehold estate, until and including December 31, 2026, in the following described tracts or parcels of land situated in the State of Minnesota described as follows:

In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-seven (57) North, Range Twenty-one (21) West;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼) of Section Twenty-seven (27), Township Fifty-seven (57) North, Range Twenty-two (22) West;

which tracts or parcels of land are hereinafter referred to as the “Premises;” and

WHEREAS, it is mutually desired by the Lessors and the Lessee to further amend said Operating Agreement as to certain particulars.

NOW, THEREFORE, in consideration of the Premises and of the respective benefits to accrue to each of them by the making of this Amendment, the parties hereby agree unto and with each other that the said Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, and further amended by that certain document dated November 1, 2000, but effective January 1, 2000, and further amended by that certain document dated January 30, 2003, but effective January 1, 2003, shall be and

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hereby is further amended as of October 1, 2003, but effective January 1, 2004, in the following particulars only, and not otherwise, to-wit:

ARTICLE III (DEFINITIONS), is amended by replacing Paragraph (g), entitled “ship,” “shipped” and “shipment”, in its entirety, with the following paragraph:

“(g) “ship,” “shipped” and “shipment”: (i) When used with reference to Merchantable Iron Ore, the removal of such ore from the Premises for any purpose other than stockpiling, and, if stockpiled, the removal from stockpile for any purpose other than restockpiling; (ii) when used with reference to Concentratable Ore, the removal of such ore from the Premises for any purpose other than stockpiling or treatment, and, if stockpiled, the removal from stockpile for any purpose other than treatment or restockpiling; (iii) when used with reference to Concentrates, the removal of such Concentrates from the place of treatment for any purpose other than stockpiling; (iv) when used with reference to Mineable Taconite from the Premises, the total tonnage of Mineable Taconite determined *** ; and (v) when used with reference to Mineable Taconite removed from stockpile, the month in which Mineable Taconite is removed from stockpile for any purpose other than restockpiling.”

ARTICLE III (DEFINITIONS) is further amended by adding the following Paragraph (n) at the end of said ARTICLE III (DEFINITIONS):

“(n) “Mineable Taconite”: Taconite that, based on good engineering standards then in effect on the Mesabi Range prior to the time Taconite is blasted, or removed from stockpile, is considered suitable for treatment to produce Oxide Pellets, Reduced Pellets or Partially Reduced Pellets. The density factor to be used to convert cubic feet of Taconite, which has not been blasted, to tons of Mineable Taconite is 11 cubic feet per ton. The factor to be used to convert tons of stockpiled Taconite to tons of Mineable Taconite will be an equitable truck factor that will be established at the time of removal.”

ARTICLE IV (LESSEE’S COVENANTS), Section 1., entitled “Operations,” is amended by replacing the first paragraph of this Section 1. with the following paragraph:

“All operations of the Lessee under this Agreement which involve the mining and removal of any ores or materials from the Premises shall be conducted in a good and workmanlike manner and in accordance with good engineering standards then in effect on the Mesabi Range, and Lessee shall furnish to Lessors from time to time upon their request, (i) one copy of Lessee’s mine maps and cross sections (with the results of drilling shown thereon) respecting the Premises, (ii) reports of the tonnage of all Mineable Taconite shipped or removed from stockpile, and (iii) statements of the

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estimated tonnage of all Merchantable Iron Ore, Concentrates, Taconite, Mineable Taconite, Concentratable Ore and any other iron-bearing materials mined from the Premises and stockpiled thereon or elsewhere, it being understood that all such information shall be such as the Lessee customarily obtains for its own records and Lessee shall not be required to compile special reports or statements for such purposes; provided, however, that, subject to the above requirements, the Lessee may, from time to time and when and as it deems it desirable, use and employ such methods of mining, treating, concentrating or beneficiating any or all of the ores and iron-bearing materials in or derived from the Premises as it may desire or find most profitable or economical.”

ARTICLE IV (LESSEE’S COVENANTS), Section 2., entitled “Royalty,” is amended by inserting a comma and the words “Mineable Taconite” after the word “Concentrates” in the first paragraph of said Section 2.

Section 2. is further amended by adding the following subsection (4) to said Article IV, Section 2.B.:

“(4) Notwithstanding the above, beginning January 1, 2004, and continuing for the remaining term of the Indenture of Lease and Operating Agreement, the factor of the percent of weight recovery for Mineable Taconite shall be   ***.”

Section 2. is further amended by adding the following Paragraph I. at the end of said Article IV, Section 2.:

“I. Notwithstanding the above royalty rate calculations and for the sole purpose of determining an earned royalty rate for the two-year period 2004 through 2005, said earned royalty rate for each ton of Mineable Taconite shipped from the Premises shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.I. hereof, to the November 2002 PPI I/S, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period)

(November 2002 PPI I/S = 117.9)

With respect to the preceding paragraph, in no event shall the product derived from multiplying (i) by (ii), as defined above within this Article IV, Section 2.I. hereof, be less than   ***.

Notwithstanding the above royalty rate calculations and for the sole purpose of determining an earned royalty rate beginning with the calendar year 2006, and

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continuing for the remaining term of the Indenture of Lease and Operating Agreement, said earned royalty rate for each ton of Mineable Taconite shipped from the Premises shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.I. hereof, to the November 2005 PPI I/S, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qrtly. Calculation Period)

(November 2005 PPI I/S)

For purposes of this Article IV, Section 2.I., the PPI I/S, to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) immediately preceding the quarter in which shipments are made. For example: The PPI I/S for February would be used to calculate the royalty on shipments made in the second calendar quarter.

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index, which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.”

ARTICLE IV (LESSEE’S COVENANTS), Section 3., entitled “Minimum Royalty,” is amended by adding the following sentence at the end of the seventh full paragraph beginning “If, at any time after the first calendar year of this Agreement, the accumulated tonnage of Taconite...” of said Section 3.:

“Notwithstanding the above, beginning January 1, 2004, to determine the total number of tons of Oxide Pellets paid for as escalated earned or minimum royalty, the escalated earned or minimum royalty paid for each quarterly period shall be divided by the quotient of (i) the earned royalty rate for each ton of Mineable Taconite shipped from the Premises in effect in the calendar quarter for which such determination is made, divided by (ii) the   ***   weight recovery percentage of   ***  . For example:

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Quarterly Escalated Earned or Minimum Royalty

Quarterly Escalated Earned Royalty Rate for Mineable Taconite ÷   ***   ”

ARTICLE IV (LESSEE’S COVENANTS), Section 5., entitled “Reports,” is amended by replacing the period at the end of subsection (d) with a semicolon, and by adding the following subsection (e) at the end of the first paragraph of Section 5.:

“(e) The tonnage of all Mineable Taconite shipped.”

ARTICLE XIX (INSOLVENCY), is amended by replacing Paragraph (a), in its entirety, with the following paragraph:

“(a) The royalties for all Merchantable Iron Ore, Concentrates, Mineable Taconite and Taconite theretofore shipped from the Premises and not theretofore paid for shall forthwith and immediately become due and payable, any provision herein contained to the contrary notwithstanding; and”

ARTICLE XIX (INSOLVENCY) is further amended by replacing Paragraph (b), in its entirety, with the following paragraph:

“(b) The right of the Lessee to remove or ship or take away Merchantable Iron Ore, Concentrates, Mineable Taconite or Taconite from the Premises shall, upon written notice from Lessors, be and remain suspended and no Merchantable Iron Ore, Concentrates, Mineable Taconite or Taconite shall thereafter be shipped, removed or taken away from the Premises by the Lessee or any receiver of anyone claiming under this Agreement, unless and until all royalties for such ore theretofore shipped and all sums payable hereunder, including all taxes, assessments and governmental charges herein agreed to be paid by the Lessee and then payable, shall have been paid, and, during the period that bankruptcy or insolvency shall continue, no Merchantable Iron Ore, Concentrates, Mineable Taconite or Taconite shall be shipped from the Premises unless and until all royalties thereon shall have first been paid and all other sums due and payable shall have been paid or, to the satisfaction of the Lessors, secured to be paid; and”

All other terms and conditions of the Indenture of Lease and Operating Agreement, as amended, are hereby ratified and affirmed.

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IN WITNESS WHEREOF, the parties have duly executed this instrument, in multiple counterparts, all of which will be considered one and the same agreement, as of the day and year first above written, but effective as of January 1, 2004.

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LESSORS:

GREAT NORTHERN IRON ORE PROPERTIES

/s/ Joseph S. Micallef

Joseph S. Micallef

/s/ Roger W. Staehle

Roger W. Staehle

/s/ Robert A. Stein

Robert A. Stein

/s/ John H. Roe, III

John H. Roe, III

All as Trustees as aforesaid

STATE OF MINNESOTA	)
	) ss.
COUNTY OF RAMSEY	)

On this 15th day of March , 2004, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument on behalf of the Trust, and acknowledged that they executed the same as their free act and deed.

/s/ Angela Jo Pollard

Notary Public

My Commission Expires Jan. 31, 2005

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LESSEE:
HIBBING TACONITE HOLDING INC.
By	/s/ Gordon Spelich
Attest	/s/ Kristin L. Kasmer

STATE OF Ohio	)
	) ss.
COUNTY OF Summit	)

On this 10th day of February, 2004, before me, a Notary Public within and for said County and State, personally appeared Gordon Spelich the Vice Pres. of HIBBING TACONITE HOLDING INC., a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Thomas F. Wood

Notary Public

My Commission Expires ____________

My Commission Has No Expiration Date

Section 147.03 R.C.

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LESSEE:
CLIFFS MINING COMPANY
By	/s/ E. C. Dowling, Jr.
	Executive Vice President-Operations
Attest	/s/ J. E. Lenhard
	Vice President, Secretary and General Counsel

STATE OF OHIO	)
	) ss.
COUNTY OF CUYAHOGA	)

On this 6th day of February, 2004, before me, a Notary Public within and for said County and State, personally appeared E. C. DOWLING, JR. the EXECUTIVE VICE PRESIDENT-OPERATIONS of CLIFFS MINING COMPANY, a Delaware corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Joan M. Spirnak

Notary Public

My Commission Expires Aug. 2, 2005

-10-

LESSEE:
ONTARIO HIBBING COMPANY
By	/s/ B. W. Warry
Attest	/s/ J. A. B. John

PROVINCE OF ONTARIO	)
	) ss.
DOMINION OF CANADA	)

On this 3rd day of February, 2004, before me, a Notary Public within and for said Province and Dominion, personally appeared BRIAN W. WARRY the PRESIDENT of ONTARIO HIBBING COMPANY, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ J. A. B. John

Notary Public

My Commission Expires at the pleasure of the Crown.

-11-

LESSEE:
HIBBING DEVELOPMENT COMPANY By Pickands Hibbing Corporation
By	/s/ E. C. Dowling, Jr.
	E. C. Dowling, Jr., Vice President
Attest	/s/ J. E. Lenhard
	J. E. Lenhard, Secretary

STATE OF OHIO	)
	) ss.
COUNTY OF CUYAHOGA	)

On this 6th day of February, 2004, before me, a Notary Public within and for said County and State, personally appeared E. C. DOWLING, JR. the VICE PRESIDENT of Pickands Hibbing Corporation, a general partner of HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership, to me known to be the person described in and who executed the foregoing instrument on behalf of the Partnership, and acknowledged that he executed the same as his free act and deed.

/s/ Joan M. Spirnak

Notary Public

My Commission Expires Aug 2, 2005

-12-

THIS INDENTURE, made and effective this 1^st day of January, 2006, by and between:

JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN and JOHN H. ROE, III, as Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES,

parties of the first part, hereinafter referred to as “Lessors;” and

HIBBING TACONITE HOLDING, INC., a Minnesota corporation (to the extent of an undivided 50% interest), CLIFFS MINING COMPANY, a Delaware corporation formerly known as Pickands Mather & Co. (to the extent of an undivided 10% interest), ONTARIO HIBBING COMPANY, a Minnesota corporation (to the extent of an undivided 6.6667% interest) and HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership (to the extent of an undivided 33.3333% interest); which entities are collectively known as HIBBING TACONITE JOINT VENTURE,

parties of the second part, hereinafter referred to as “Lessee.”

W I T N E S S E T H

WHEREAS, by an Indenture of Lease dated January 1, 1979 and an Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, and further amended by that certain document dated November 1, 2000, but effective January 1, 2000, and further amended by that certain document dated January 30, 2003, but effective January 1, 2003, and further amended by that certain document dated October 1, 2003, but effective January 1, 2004 (hereinafter collectively referred to as the “Indenture of Lease and Operating Agreement”), the Lessors, or their respective predecessor Trustees, granted to the Lessee, or its predecessor Mahoning Ore and Steel Partnership, a Minnesota partnership, a leasehold estate, until and including December 31, 2026, in the following described tracts or parcels of land situated in the State of Minnesota described as follows:

In St. Louis County:

Lots One (1), Two (2), Three (3) and Four (4) of Section One (1) and Lots One (1), Two (2), Three (3) and Four (4) of Section Two (2), (all of the foregoing described lots herein collectively referred to as “Tract 1”); the Northeast Quarter of the Southwest Quarter (NE¼-SW¼), the Southeast Quarter of the Southwest Quarter (SE¼-SW¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the North Half of the Southwest Quarter of the Southeast Quarter (N½-SW¼-SE¼) of Section Two (2); the Southeast Quarter of the Southeast Quarter (SE¼-SE¼) of Section Three (3); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼), the Northwest Quarter of the Southeast Quarter (NW¼-SE¼) and the Southwest Quarter of the Southeast Quarter (SW¼-SE¼) of Section Eight (8); the Southwest Quarter of the Northeast Quarter (SW¼-NE¼) and the Southeast Quarter of the Northeast Quarter (SE¼-NE¼) of Section Nine (9); the Northeast Quarter of the Northeast Quarter (NE¼-NE¼), the Northeast Quarter of the Northwest Quarter (NE¼-NW¼), the Northwest Quarter of the Northwest Quarter (NW¼-NW¼), the Southwest Quarter of the Northwest Quarter (SW¼-NW¼), the Southeast Quarter of the Northwest Quarter (SE¼-NW¼) and the Northwest Quarter of the Southwest Quarter (NW¼-SW¼) of Section Ten (10), Township Fifty-seven (57) North, Range Twenty-one (21) West;

In Itasca County:

The Southeast Quarter of the Southwest Quarter (SE¼-SW¼) of Section Twenty-seven (27), Township Fifty-seven (57) North, Range Twenty-two (22) West;

which tracts or parcels of land are hereinafter referred to as the “Premises;” and

WHEREAS, it is mutually desired by the Lessors and the Lessee to further amend said Operating Agreement as to certain particulars.

NOW, THEREFORE, in consideration of the Premises and of the respective benefits to accrue to each of them by the making of this Amendment, the parties hereby agree unto and with each other that the said Operating Agreement dated January 1, 1979, as amended by that certain document dated March 19, 1993, but effective January 1, 1993, and further amended by that certain document dated November 1, 2000, but effective January 1, 2000, and further amended by that certain document dated January 30, 2003, but effective January 1, 2003, and further

-2-

amended by that certain document dated October 1, 2003, but effective January 1, 2004, shall be and hereby is further amended and effective as of January 1, 2006, in the following particulars only, and not otherwise, to-wit:

ARTICLE IV (LESSEE’S COVENANTS), Section 2., entitled “Royalty,” is amended by adding the following Paragraph J. at the end of said Article IV, Section 2.:

“J. Notwithstanding the above royalty rate calculations and for the sole purpose of determining an earned royalty rate for the three-year period 2006 through 2008, inclusive, said earned royalty rate for each ton of Mineable Taconite shipped from the Premises shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.J. hereof, to the November 2002 PPI I/S, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period)

(November 2002 PPI I/S = 117.9)

With respect to the preceding paragraph, in no event shall the product derived from multiplying (i) by (ii), as defined above within this Article IV, Section 2.J. hereof, be less than   ***  .

Notwithstanding the above royalty rate calculations and for the sole purpose of determining an earned royalty rate beginning with the calendar year 2009, and continuing for the remaining term of the Indenture of Lease and Operating Agreement, said earned royalty rate for each ton of Mineable Taconite shipped from the Premises shall be the product resulting from multiplying (i)   ***  , by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 2.J. hereof, to the November 2008 PPI I/S, said earned royalty rate to be calculated to four decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period)

(November 2008 PPI PS)

For purposes of this Article IV, Section 2.J., the PPI I/S, to be used for the quarterly calculation period, shall be the unadjusted index (with 1982 = 100 as a base), commodity code 10-1, published by the Bureau of Labor Statistics of the United States Department of Labor for the second month in the quarterly period (i.e., for February, May, August or November) immediately preceding the quarter in which shipments are made. For example: The PPI I/S for February would be used to calculate the royalty on shipments made in the second calendar quarter.

-3-

In the event some period other than 1982 is used as a base of 100 in determining the PPI I/S, such PPI I/S shall be adjusted so as to be in correct relationship to such 1982 base. In the event the PPI I/S is changed or is not published by any Federal agency, the index to be used as aforesaid shall be that index published, which, after necessary adjustment, if any, provides the most reasonable substitute for the PPI I/S during any period subsequent to the change or cessation of publication, it being intended to substitute an index which most accurately reflects the fluctuations in the prices of iron and steel in the manner presently reported by the Producer Price Index for the Iron and Steel Subgroup. If the parties hereto cannot agree upon a substitute index, which accomplishes this purpose, such question shall be determined by arbitration in the manner hereinafter provided.”

ARTICLE IV (LESSEE’S COVENANTS), Section 3., entitled “Minimum Royalty,” is amended by inserting the following paragraphs before the fifth full paragraph of said Article IV, Section 3.:

“Notwithstanding the above, for the three-year period 2006 through 2008, inclusive, the minimum royalty shall be   ***   for each calendar year (2006, 2007 and 2008).   ***.

Notwithstanding the above, beginning with the calendar year 2009 and continuing for the remaining term of the Indenture of Lease and Operating Agreement, the minimum royalty shall be the product resulting from multiplying (i)   ***  , hereinafter referred to as the “Base Minimum Royalty,” by (ii) a ratio of the Producer Price Index for the Iron and Steel Subgroup (PPI I/S) for the quarterly calculation period, as defined within this Article IV, Section 3. hereof, to the November 2008 Producer Price Index for the Iron and Steel Subgroup, said minimum royalty to be calculated to two decimal places. For example:

$   *** x   (PPI I/S Qtrly. Calculation Period)

(November 2008 PPI I/S) ”

All other terms and conditions of the Indenture of Lease and Operating Agreement, as amended, are hereby ratified and affirmed.

IN WITNESS WHEREOF, the parties have duly executed this instrument, in multiple counterparts, all of which will be considered one and the same agreement, effective as of the day and year first above written, that being January 1, 2006.

-4-

LESSORS:

GREAT NORTHERN IRON ORE PROPERTIES

/s/ Joseph S. Micallef

Joseph S. Micallef

/s/ Roger W. Staehle

Roger W. Staehle

/s/ Robert A. Stein

Robert A. Stein

/s/ John H. Roe, III

John H. Roe, III

All as Trustees aforesaid

STATE OF MINNESOTA	)
	) ss.
COUNTY OF RAMSEY	)

On this 20th day of March, 2006, before me, a Notary Public within and for said County and State, personally appeared JOSEPH S. MICALLEF, ROGER W. STAEHLE, ROBERT A. STEIN AND JOHN H. ROE, III, to me personally known, who, being by me each personally sworn, did respectively say that they are Trustees under that certain Trust Agreement executed December 7, 1906, by and between the Lake Superior Company, Limited, an association organized under the laws of the State of Michigan, and Louis W. Hill, James N. Hill, Walter J. Hill and Edward T. Nichols; which Trust is commonly known as GREAT NORTHERN IRON ORE PROPERTIES; and that as said Trustees, they executed the foregoing instrument on behalf of the Trust, and acknowledged that they executed the same as their free act and deed.

/s/ Linda J. Bergen

Notary Public

My Commission Expires 1-31-09

-5-

LESSEE:
HIBBING TACONITE HOLDING INC.
By	/s/ Carlos M. Hernandez
Printed Name/Title		VP C. Hernandez

STATE OF Indiana	)
	) ss.
COUNTY OF Lake	)

On this 3rd day of May, 2006, before me, a Notary Public within and for said County and State, personally appeared Carlos M. Hernandez, the Vice President of HIBBING TACONITE HOLDING INC., a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Sarah M. Gasienica

Notary Public

My Commission Expires May 22, 2009

-6-

LESSEE:
CLIFFS MINING COMPANY
By	/s/ J. A. Carrabba
	J. A. Carrabba
Printed Name/Title		President

STATE OF OHIO	)
	) ss.
COUNTY OF CUYAHOGA	)

On this 8th day of March, 2006, before me, a Notary Public within and for said County and State, personally appeared J. A. CARRABBA, the PRESIDENT of CLIFFS MINING COMPANY, a Delaware corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Joan M. Spirnak

Notary Public

My Commission Expires Aug. 2, 2010

-7-

LESSEE:
ONTARIO HIBBING COMPANY
By	/s/ C. Osborne
Printed Name/Title		C. Osborne
		President & Treasurer

PROVINCE OF Ontario	)
	) ss.
DOMINION OF Canada	)

On this 11th day of May, 2006, before me, a Notary Public within and for said Province and Dominion, personally appeared Colin Osborne, the President & Treasurer of ONTARIO HIBBING COMPANY, a Minnesota corporation, to me known to be the person described in and who executed the foregoing instrument on behalf of the Corporation, and acknowledged that he executed the same as his free act and deed.

/s/ Greg McNels
Notary Public
My Commission Expires	None

-8-

LESSEE:
HIBBING DEVELOPMENT COMPANY By Pickands Hibbing Corporation
By	/s/ J. A. Carrabba
	J. A. Carrabba
Printed Name/Title		President

STATE OF OHIO	)
	) ss.
COUNTY OF CUYAHOGA	)

On this 8th day of March, 2006, before me, a Notary Public within and for said County and State, personally appeared J. A. CARRABBA, the PRESIDENT of Pickands Hibbing Corporation, a general partner of HIBBING DEVELOPMENT COMPANY, a Minnesota general partnership, to me known to be the person described in and who executed the foregoing instrument on behalf of the Partnership, and acknowledged that he executed the same as his free act and deed.

/s/ Joan M. Spirnak

Notary Public

My Commission Expires Aug. 2, 2010

-9-

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Joseph S. Micallef, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Great Northern Iron Ore Properties;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15f and 15d-15(f)) for the registrant and have:

              a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

              b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

              c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

              d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors [or persons performing the equivalent functions]:

              a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

              b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By	/s/ Joseph S. Micallef	Date:	July 24, 2008
	Joseph S. Micallef President of the Trustees and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Thomas A. Janochoski, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Great Northern Iron Ore Properties;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15f and 15d-15(f)) for the registrant and have:

              a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

              b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

              c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

              d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors [or persons performing the equivalent functions]:

              a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

              b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

By	/s/ Thomas A. Janochoski	Date:	July 24, 2008
	Thomas A. Janochoski Vice President & Secretary and Chief Financial Officer

EX-32.1

Exhibit 32.1

Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002 (Furnished but not filed)

In connection with this quarterly report of Great Northern Iron Ore Properties on Form 10-Q filed with the Securities and Exchange Commission, I, Joseph S. Micallef, President of the Trustees and Chief Executive Officer of Great Northern Iron Ore Properties, certify that:

1. This quarterly report fully complies with the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in this quarterly report fairly presents, in all material respects, the financial condition and results of operations of Great Northern Iron Ore Properties.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Great Northern Iron Ore Properties and will be retained by Great Northern Iron Ore Properties and furnished to the Securities and Exchange Commission or its staff upon request.

Date	July 24, 2008	By	/s/ Joseph S. Micallef
			Joseph S. Micallef, President of the Trustees and Chief Executive Officer

In connection with this quarterly report of Great Northern Iron Ore Properties on Form 10-Q filed with the Securities and Exchange Commission, I, Thomas A. Janochoski, Vice President & Secretary and Chief Financial Officer of Great Northern Iron Ore Properties, certify that:

1. This quarterly report fully complies with the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in this quarterly report fairly presents, in all material respects, the financial condition and results of operations of Great Northern Iron Ore Properties.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Great Northern Iron Ore Properties and will be retained by Great Northern Iron Ore Properties and furnished to the Securities and Exchange Commission or its staff upon request.

Date	July 24, 2008	By	/s/ Thomas A. Janochoski
			Thomas A. Janochoski, Vice President & Secretary and Chief Financial Officer