Sample Business Contracts


Severance Agreement - Cleveland-Cliffs Inc. and Edward C. Dowling


                               SEVERANCE AGREEMENT

            THIS SEVERANCE AGREEMENT (this "Agreement"), dated as of March 9,
2004 is made and entered by and between Cleveland-Cliffs Inc, an Ohio
corporation (the "Company"), and Edward C. Dowling (the "Executive").

                                   WITNESSETH:

            WHEREAS, the Executive is a senior executive of the Company or one
or more of its Subsidiaries and is expected to make major contributions to the
short- and long-term profitability, growth and financial strength of the
Company;

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

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

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

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

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

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

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

      (b)         "Board" means the Board of Directors of the Company.

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

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

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

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

            (iv)        intentional wrongful engagement in any Competitive
                  Activity;

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

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

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

            (ii)        individuals who, as of the date hereof, constitute the
                  Board (the "Incumbent Board") cease for any reason to
                  constitute at least a majority of the Board; provided,
                  however, that any individual becoming a Director subsequent to
                  the date hereof whose election, or nomination for election by
                  the Company's shareholders, was approved by a vote of at least
                  a majority of the Directors then comprising the Incumbent
                  Board (either by

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                  a specific vote or by approval of the proxy statement of the
                  Company in which such person is named as a nominee for
                  director, without objection to such nomination) shall be
                  deemed to have been a member of the Incumbent Board, but
                  excluding, for this purpose, any such individual whose initial
                  assumption of office occurs as a result of an actual or
                  threatened election contest (within the meaning of Rule 14a-11
                  of the Exchange Act) with respect to the election or removal
                  of Directors or other actual or threatened solicitation of
                  proxies or consents by or on behalf of a Person other than the
                  Board; or

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

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

      (e)         "Competitive Activity" means the Executive's participation,
            without the written consent of an officer of the Company, in the
            management of any business enterprise if such enterprise engages in
            substantial and direct competition with the Company and such
            enterprise's sales of any product or service competitive with any
            product or service of the Company amounted to 10% of such
            enterprise's net

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            sales for its most recently completed fiscal year and if the
            Company's net sales of said product or service amounted to 10% of
            the Company's net sales for its most recently completed fiscal year.
            "Competitive Activity" will not include (i) the mere ownership of
            securities in any such enterprise and the exercise of rights
            appurtenant thereto or (ii) participation in the management of any
            such enterprise other than in connection with the competitive
            operations of such enterprise.

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

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

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

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

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

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

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

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

      (n)         "Term" means the period commencing as of the date hereof and
            expiring as of the later of (i) the close of business on December
            31, 2004, or (ii) the expiration of the Severance Period; provided,
            however, that (A) commencing on January 1, 2005 and each January 1
            thereafter, the term of this Agreement will automatically be
            extended for an additional year unless, not later than September 30
            of the immediately preceding year, the Company or the Executive
            shall have given notice that it or the Executive, as the case may
            be, does not wish to have the Term extended and (B) subject to the
            last sentence of Section 9, if, prior to a Change in Control, the
            Executive ceases for any reason to be an officer of the Company and
            any Subsidiary, thereupon without further action the Term shall be
            deemed to have expired and this Agreement will immediately terminate
            and be of no further effect. For purposes of this Section 1(n), the
            Executive shall not be deemed to have ceased to be an employee of
            the Company and any Subsidiary by reason of the transfer of
            Executive's employment between the Company and any Subsidiary, or
            among any Subsidiaries.

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

      (p)         "Voting Stock" means securities entitled to vote generally in
            the election of directors.

2.                Operation of Agreement. This Agreement will be effective and
      binding immediately upon its execution, but, anything in this Agreement to
      the contrary notwithstanding, this Agreement will not be operative unless
      and until a Change in Control occurs. Upon the occurrence of a Change in
      Control at any time during the Term, without further action, this
      Agreement shall become immediately operative, including without
      limitation, the last sentence of Section 9 notwithstanding that the Term
      may have theretofore expired.

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

      (i)               The Executive's death;

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

      (iii)             Cause.

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

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

            (i)         Failure to elect or reelect or otherwise to maintain the
                  Executive in the office or the position, or a substantially
                  equivalent office or position, of or with the Company and/or a
                  Subsidiary (or any successor thereto by operation of law or
                  otherwise), as the case may be, which the Executive held
                  immediately prior to a Change in Control, or the removal of
                  the Executive as a Director of the Company and/or a Subsidiary
                  (or any successor thereto) if the Executive shall have been a
                  Director of the Company and/or a Subsidiary immediately prior
                  to the Change in Control;

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

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            (iii)       A determination by the Executive (which determination
                  will be conclusive and binding upon the parties hereto
                  provided it has been made in good faith and in all events will
                  be presumed to have been made in good faith unless otherwise
                  shown by the Company by clear and convincing evidence) that a
                  change in circumstances has occurred following a Change in
                  Control, including, without limitation, a change in the scope
                  of the business or other activities for which the Executive
                  was responsible immediately prior to the Change in Control,
                  which has rendered the Executive substantially unable to carry
                  out, has substantially hindered Executive's performance of, or
                  has caused Executive to suffer a substantial reduction in, any
                  of the authorities, powers, functions, responsibilities or
                  duties attached to the position held by the Executive
                  immediately prior to the Change in Control, which situation is
                  not remedied within 10 calendar days after written notice to
                  the Company from the Executive of such determination;

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

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

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

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

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

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

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

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

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

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

      (b)         Subject to the provisions of Section 5(f), all determinations
            required to be made under this Section 5, including whether an
            Excise Tax is payable by the Executive and the amount of such Excise
            Tax and whether a Gross-Up Payment is required to be paid by the
            Company to the Executive and the amount of such Gross-Up Payment, if
            any, shall be made by a nationally recognized accounting firm (the
            "Accounting Firm") selected by the Executive in his sole discretion.
            The Executive shall direct the Accounting Firm to submit its
            determination and detailed supporting calculations to both the
            Company and the Executive within 30 calendar days after the
            Termination Date, if applicable, and any such other time or times as
            may be requested by the Company or the Executive. If the Accounting
            Firm determines that any Excise Tax is payable by the Executive, the
            Company shall pay the required Gross-Up Payment to the Executive
            within five business days after receipt of such determination and
            calculations with respect to any Payment to the Executive. If the
            Accounting Firm determines that no Excise Tax is payable by the
            Executive, it shall, at the same time as it makes such
            determination, furnish the Company and the Executive an opinion that
            the Executive has substantial authority not to report any Excise Tax
            on his federal,

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            state or local income or other tax return. As a result of the
            uncertainty in the application of Section 4999 of the Code (or any
            successor provision thereto) and the possibility of similar
            uncertainty regarding applicable state or local tax law at the time
            of any determination by the Accounting Firm hereunder, it is
            possible that Gross-Up Payments which will not have been made by the
            Company should have been made (an "Underpayment"), consistent with
            the calculations required to be made hereunder. In the event that
            the Company exhausts or fails to pursue its remedies pursuant to
            Section 5(f) and the Executive thereafter is required to make a
            payment of any Excise Tax, the Executive shall direct the Accounting
            Firm to determine the amount of the Underpayment that has occurred
            and to submit its determination and detailed supporting calculations
            to both the Company and the Executive as promptly as possible. Any
            such Underpayment shall be promptly paid by the Company to, or for
            the benefit of, the Executive within five business days after
            receipt of such determination and calculations.

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

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

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

      (f)         The Executive shall notify the Company in writing of any claim
            by the Internal Revenue Service or any other taxing authority that,
            if successful, would

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

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

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

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

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

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

                                       11
<PAGE>

Furthermore, the Company's control of any such contested claim shall be limited
to issues with respect to which a Gross-Up Payment would be payable hereunder
and the Executive shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other taxing
authority.

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

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

7.                Legal Fees and Expenses.(a) (a) It is the intent of the
      Company that the Executive not be required to incur legal fees and the
      related expenses associated with the interpretation, enforcement or
      defense of Executive's rights under this Agreement by litigation or
      otherwise because the cost and expense thereof would substantially detract
      from the benefits intended to be extended to the Executive hereunder.
      Accordingly, if it should appear to the Executive that the Company has
      failed to comply with any of its obligations under this Agreement or in
      the event that the Company or any other person takes or threatens to take
      any action to declare this Agreement void or unenforceable, or institutes
      any litigation or other action or proceeding designed to deny, or to
      recover from, the Executive the benefits provided or intended to be
      provided to the Executive hereunder, the Company irrevocably authorizes
      the Executive from time to time to retain counsel

                                       12
<PAGE>

      of Executive's choice, at the expense of the Company as hereafter
      provided, to advise and represent the Executive in connection with any
      such interpretation, enforcement or defense, including without limitation
      the initiation or defense of any litigation or other legal action, whether
      by or against the Company or any Director, officer, stockholder or other
      person affiliated with the Company, in any jurisdiction. Notwithstanding
      any existing or prior attorney-client relationship between the Company and
      such counsel, the Company irrevocably consents to the Executive's entering
      into an attorney-client relationship with such counsel, and in that
      connection the Company and the Executive agree that a confidential
      relationship shall exist between the Executive and such counsel. Without
      respect to whether the Executive prevails, in whole or in part, in
      connection with any of the foregoing, the Company will pay and be solely
      financially responsible for any and all attorneys' and related fees and
      expenses incurred by the Executive in connection with any of the
      foregoing; provided that, in regard to such matters, the Executive has not
      acted in bad faith or with no colorable claim of success.

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

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

                  (A)   transfer to Trustee to be added to the principal of the
                        Trust under Trust Agreement No. 1 a sum equal to (I) the
                        present value on the date of the Change in Control (or
                        on such fifth business day if the Board has declared a
                        Change in Control to be imminent) of the payments to be
                        made to Executive under the provisions of Annex A and
                        Section 5 hereof, such present value to be computed
                        using the assumptions set forth in Annex A hereof and
                        the computations provided for in Section 5 hereof less
                        (II) the balance in the Executive's accounts provided
                        for in Trust Agreement No. 1 as of

                                       13
<PAGE>

                        the most recent completed valuation thereof, as
                        certified by the Trustee under Trust Agreement No. 1
                        less (III) the balance in the Executive's accounts
                        provided for in Trust Agreement No. 7 as of the most
                        recently completed valuation thereof, as certified by
                        the Trustee under Trust Agreement No. 7; provided,
                        however, that if the Trustee under Trust Agreement No. 1
                        and/or Trust Agreement No. 7 does not so certify by the
                        end of the fourth (4th) business day after the earlier
                        of such Change in Control or declaration, then the
                        balance of such respective account shall be deemed to be
                        zero. Any payments of compensation, pension or other
                        benefits by the Trustee pursuant to Trust Agreement No.
                        1 or Trust Agreement No. 7 shall, to the extent thereof,
                        discharge the Company's obligation to pay compensation,
                        pension and other benefits hereunder, it being the
                        intent of the Company that assets in such Trusts be held
                        as security for the Company's obligation to pay
                        compensation, pension and other benefits under this
                        Agreement; and

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

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

      (b)         During the Term, the Company agrees that it will disclose to
            Executive its confidential or proprietary information (as defined in
            this Section 8(b)) to the extent necessary for Executive to carry
            out his obligations to the Company. The Executive hereby covenants
            and agrees that he will not, without the prior written consent of
            the Company, during the Term or thereafter disclose to any person
            not employed by the Company, or use in connection with engaging in
            competition

                                       14
<PAGE>

            with the Company, any confidential or proprietary information of the
            Company. For purposes of this Agreement, the term "confidential or
            proprietary information" will include all information of any nature
            and in any form that is owned by the Company and that is not
            publicly available (other than by Executive's breach of this Section
            8(b)) or generally known to persons engaged in businesses similar or
            related to those of the Company. Confidential or proprietary
            information will include, without limitation, the Company's
            financial matters, customers, employees, industry contracts,
            strategic business plans, product development (or other proprietary
            product data), marketing plans, and all other secrets and all other
            information of a confidential or proprietary nature. For purposes of
            the preceding two sentences, the term "Company" will also include
            any Subsidiary (collectively, the "Restricted Group"). The foregoing
            obligations imposed by this Section 8(b) will not apply (i) during
            the Term, in the course of the business of and for the benefit of
            the Company, (ii) if such confidential or proprietary information
            will have become, through no fault of the Executive, generally known
            to the public or (iii) if the Executive is required by law to make
            disclosure (after giving the Company notice and an opportunity to
            contest such requirement).

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

9.                Employment Rights. Nothing expressed or implied in this
      Agreement will create any right or duty on the part of the Company or the
      Executive to have the Executive remain in the employment of the Company or
      any Subsidiary prior to or following any Change in Control. Any
      termination of employment of the Executive or the removal of the Executive
      from the office or position in the Company or any Subsidiary that occurs
      (i) not more than 180 days prior to the date on which a Change in Control
      occurs, and (ii) following the commencement of any discussion with a third
      person that ultimately results in a Change in Control, shall be deemed to
      be a termination or removal of the Executive after a Change in Control for
      purposes of this Agreement.

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

11.               Successors and Binding Agreement.(a) (a) The Company will
      require any successor (whether direct or indirect, by purchase, merger,
      consolidation, reorganization or otherwise) to all or substantially all of
      the business or assets of the Company, by agreement in form and substance
      reasonably satisfactory to the Executive, expressly to assume and agree to
      perform this Agreement in the same manner and to the same extent the
      Company would be required to perform if no

                                       15
<PAGE>

      such succession had taken place. This Agreement will be binding upon and
      inure to the benefit of the Company and any successor to the Company,
      including without limitation any persons acquiring directly or indirectly
      all or substantially all of the business or assets of the Company whether
      by purchase, merger, consolidation, reorganization or otherwise (and such
      successor shall thereafter be deemed the "Company" for the purposes of
      this Agreement), but will not otherwise be assignable, transferable or
      delegable by the Company.

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

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

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

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

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

                                       16
<PAGE>

15.               Miscellaneous. No provision of this Agreement may be modified,
      waived or discharged unless such waiver, modification or discharge is
      agreed to in writing signed by the Executive and the Company. No waiver by
      either party hereto at any time of any breach by the other party hereto or
      compliance with any condition or provision of this Agreement to be
      performed by such other party will be deemed a waiver of similar or
      dissimilar provisions or conditions at the same or at any prior or
      subsequent time. No agreements or representations, oral or otherwise,
      expressed or implied with respect to the subject matter hereof have been
      made by either party which are not set forth expressly in this Agreement.
      References to Sections are to references to Sections of this Agreement.

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

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

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

                                      CLEVELAND-CLIFFS INC

                                      By:            /s/ J. S. Brinzo
                                          --------------------------------------
                                                         J. S. Brinzo

                                           Chairman and Chief Executive Officer

                                                     /s/ E. C. Dowling
                                          --------------------------------------

                                                     Edward C. Dowling

                                       17
<PAGE>

                                                                         Annex A

                             Severance Compensation

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

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

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

                                      A-1
<PAGE>

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

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

                  (A) At the time of his termination of employment with the
            Company (by death or otherwise), the Executive shall be credited
            with years of continuous service for benefit accrual and eligibility
            equal to the greater of (i) the number of his actual years of
            continuous service or (ii) the number of years of continuous service
            he would have had if he had continued his employment with the
            Company for three (3) years after the Termination Date, and had he
            attained the greater of (iii) his actual chronological age, (iv)
            sixty-five, or (v) his chronological age three (3) years after the
            Termination Date. In addition, the Executive shall be eligible for a
            30-year pension benefit based upon his years of continuous service
            as computed under the preceding sentence. Such Executive shall be
            eligible to commence a 30-year pension benefit on the earlier of
            (vi) the date upon which the Executive would have otherwise reached
            30 years of continuous service with the Company but for his
            termination of employment after the Change in Control at which time
            the Executive shall be deemed to be age 65, or (vii) the date upon
            which the sum of the Executive's years of continuous service (as
            computed in the first sentence of this subparagraph (A)) and the
            Executive's Credited Years of Industry Service is equal to 30 years
            of service, at which time the Executive shall be deemed to be age
            65; and

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

                                      A-2
<PAGE>

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

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

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

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

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

                                      A-3
<PAGE>

                              CLEVELAND-CLIFFS INC
                               SEVERANCE AGREEMENT

                                    EXHIBIT A

                                 Form of Release

            WHEREAS, the Executive's employment has been terminated in
accordance with Section 3 of the Severance Agreement (the "Agreement") dated as
of March 9, 2004 between the Executive and Cleveland-Cliffs Inc; and

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

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

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

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

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

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

                                    Exh. A-1
<PAGE>

      Code Section 4101.17 and Ohio Revised Code Chapter 4112, including
      Sections 4112.02 and 4112.99 thereof; and

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

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

      4. Executive further agrees and acknowledges that:

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

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

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

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

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

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

                                    Exh. A-2
<PAGE>

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

Dated:___________________________________        _______________________________
                                                            Executive

                                    Exh. A-3


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