As filed with the Securities and Exchange Commission on September 22, 2008

Registration No. 333-152974

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Amendment No. 1
to

Form S-4

 

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 

 

CLEVELAND-CLIFFS INC

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

1100 Superior Avenue

Cleveland, Ohio 44114-2544

(216) 694-5700

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

 

 

George W. Hawk, Jr., Esq.

General Counsel and Secretary

Cleveland-Cliffs Inc

1100 Superior Avenue

Cleveland, Ohio 44114-2544

(216) 694-5700

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

 

 

Copies to:

 

 

 

Approximate date of commencement of proposed sale to public:  As soon as practicable following the effective date of this registration statement and the date on which all other conditions to the merger of Alpha Merger Sub, Inc. with and into Alpha Natural Resources, Inc., or under certain circumstances, the merger of Alpha Natural Resources, Inc. with and into Alpha Merger Sub, LLC, pursuant to the merger agreement described in the enclosed document have been satisfied or waived.

 

If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  o

 

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

 

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

 

 

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

 

 

PRELIMINARY COPY

SUBJECT TO COMPLETION, DATED SEPTEMBER 22, 2008

 

TO THE SHAREHOLDERS OF

CLEVELAND-CLIFFS INC AND STOCKHOLDERS OF

ALPHA NATURAL RESOURCES, INC.

 

Cleveland-Cliffs Inc, which is referred to as Cleveland-Cliffs, and Alpha Natural Resources, Inc., which is referred to as Alpha, have entered into an agreement and plan of merger pursuant to which Alpha Merger Sub, Inc., a wholly-owned subsidiary of Cleveland-Cliffs, which is referred to as merger sub, will merge with and into Alpha, or, under certain circumstances, as described in Annex G, merger sub will be converted from a Delaware corporation to a Delaware limited liability company, Alpha Merger Sub, LLC, and Alpha will merge with and into Alpha Merger Sub, LLC. Upon successful completion of the merger, Alpha stockholders will be entitled to receive a combination of cash and Cleveland-Cliffs common shares in exchange for their shares of Alpha common stock. Pursuant to the merger, each share of Alpha common stock (other than shares of Alpha common stock held by any dissenting Alpha stockholder that has properly exercised appraisal rights in accordance with Delaware law, held in treasury by Alpha or owned by Cleveland-Cliffs) will be converted into the right to receive 0.95 of a common share of Cleveland-Cliffs and $22.23 in cash, without interest. Upon completion of the merger, we estimate that Alpha’s former stockholders will own approximately 39% of the then-outstanding common shares of Cleveland-Cliffs, based on the number of shares of Alpha common stock and Cleveland-Cliffs common shares outstanding on          , 2008. Cleveland-Cliffs shareholders will continue to own their existing shares, which will not be affected by the merger. Common shares of Cleveland-Cliffs are listed on the New York Stock Exchange under the symbol “CLF.” Upon completion of the merger, Alpha common stock, which is listed on the New York Stock Exchange under the symbol “ANR,” will be delisted. When the merger is completed, Cleveland-Cliffs will change its name to Cliffs Natural Resources Inc. and its common shares will continue to be listed on the New York Stock Exchange.

 

We expect the merger to be nontaxable for federal income tax purposes for Alpha stockholders and Cleveland-Cliffs shareholders, except for the receipt by Alpha stockholders of cash in exchange for their Alpha common stock or cash instead of fractional common shares of Cleveland-Cliffs.

 

We are each holding our special meeting of shareholders in order to obtain those approvals necessary to consummate the merger. At the Cleveland-Cliffs special meeting, Cleveland-Cliffs will ask its shareholders to adopt the merger agreement and approve the issuance of common shares of Cleveland-Cliffs in connection with the merger. At the Alpha special meeting, Alpha will ask its stockholders to adopt the merger agreement. The obligations of Cleveland-Cliffs and Alpha to complete the merger are also subject to the satisfaction or waiver of several other conditions to the merger. More information about Cleveland-Cliffs, Alpha and the proposed merger is contained in this joint proxy statement/prospectus. We urge you to read this joint proxy statement/prospectus, and the documents incorporated by reference into this joint proxy statement/prospectus, carefully and in their entirety, in particular, see “Risk Factors” beginning on page 27.

 

After careful consideration, each of our boards of directors has approved the merger agreement and has determined that the merger agreement and the merger are advisable and in the best interests of the shareholders of Cleveland-Cliffs and stockholders of Alpha, respectively. Accordingly, the Alpha board of directors recommends that the Alpha stockholders vote for the adoption of the merger agreement. The Cleveland-Cliffs board of directors recommends that the Cleveland-Cliffs shareholders vote for the adoption of the merger agreement and the issuance of Cleveland-Cliffs common shares to be issued in connection with the merger.

 

We are very excited about the opportunities the proposed merger brings to both Alpha stockholders and Cleveland-Cliffs shareholders, and we thank you for your consideration and continued support.

 

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this joint proxy statement/prospectus. Any representation to the contrary is a criminal offense.

 

This joint proxy statement/prospectus is dated          , 2008, and is first being mailed to Alpha stockholders and Cleveland-Cliffs shareholders on or about          , 2008.

 

REFERENCES TO ADDITIONAL INFORMATION

 

Except where we indicate otherwise, as used in this joint proxy statement/prospectus, “Cleveland-Cliffs” refers to Cleveland-Cliffs Inc and its consolidated subsidiaries and “Alpha” refers to Alpha Natural Resources, Inc. and its consolidated subsidiaries. This joint proxy statement/prospectus incorporates important business and financial information about Cleveland-Cliffs and Alpha from documents that each company has filed with the Securities and Exchange Commission, which we refer to as the SEC, but that have not been included in or delivered with this joint proxy statement/prospectus. For a list of documents incorporated by reference into this joint proxy statement/prospectus and how you may obtain them, see “Where You Can Find More Information” beginning on page 241.

 

This information is available to you without charge upon your written or oral request. You can also obtain the documents incorporated by reference into this joint proxy statement/prospectus by accessing the SEC’s website maintained at http://www.sec.gov.

 

In addition, Cleveland-Cliffs’ SEC filings are available to the public on Cleveland-Cliffs’ website, http://www.cleveland-cliffs.com, and Alpha’s filings with the SEC are available to the public on Alpha’s website, http://www.alphanr.com. Information contained on Cleveland-Cliffs’ website, Alpha’s website or the website of any other person is not incorporated by reference into this joint proxy statement/prospectus, and you should not consider information contained on those websites as part of this joint proxy statement/prospectus.

 

Cleveland-Cliffs will provide you with copies of this information relating to Cleveland-Cliffs, without charge, if you request them in writing or by telephone from:

 

Cleveland-Cliffs Inc
1100 Superior Avenue
Cleveland, Ohio 44114-2544
Attention: Investor Relations
(216) 694-5700

 

Alpha will provide you with copies of this information relating to Alpha, without charge, if you request them in writing or by telephone from:

 

Alpha Natural Resources, Inc.
One Alpha Place, P.O. Box 2345
Abingdon, Virginia 24212
Attention: Investor Relations
(276) 619-4410

 

If you would like to request documents, please do so by          , 2008, in order to receive them before the special meetings.

 

Cleveland-Cliffs has supplied all information contained in or incorporated by reference in this joint proxy statement/prospectus relating to Cleveland-Cliffs, and Alpha has supplied all information contained in or incorporated by reference in this joint proxy statement/prospectus relating to Alpha.

 

ALPHA NATURAL RESOURCES, INC.

One Alpha Place, P.O. Box 2345

Abingdon, Virginia 24212

 

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

TO BE HELD ON          , 2008

 

To our fellow Stockholders of Alpha Natural Resources, Inc.:

 

We will hold our special meeting of stockholders at          , on          , 2008, at          , unless adjourned to a later date. This special meeting will be held for the following purposes:

 

1. To adopt the Agreement and Plan of Merger, dated as of July 15, 2008, as it may be amended from time to time, by and among Cleveland-Cliffs Inc, Alpha Merger Sub, Inc., a wholly-owned subsidiary of Cleveland-Cliffs Inc, and Alpha Natural Resources, Inc., pursuant to which Alpha Merger Sub, Inc. will merge with and into Alpha Natural Resources, Inc., or, under certain circumstances, as described in Annex G, Alpha Merger Sub, Inc. will be converted from a Delaware corporation to a Delaware limited liability company, Alpha Merger Sub, LLC, and Alpha Natural Resources, Inc. will merge with and into Alpha Merger Sub, LLC, on the terms and subject to the conditions contained in the merger agreement, and each outstanding share of common stock of Alpha Natural Resources, Inc. (other than shares held by any of its dissenting stockholders that have properly exercised appraisal rights in accordance with Delaware law, held in its treasury or owned by Cleveland-Cliffs Inc) will be converted into the right to receive $22.23 in cash, without interest, and 0.95 of a common share of Cleveland-Cliffs Inc. A copy of the merger agreement is attached as Annex A to the accompanying joint proxy statement/prospectus; and

 

2. To approve adjournments of the Alpha Natural Resources, Inc. special meeting, if necessary, to permit further solicitation of proxies if there are not sufficient votes at the time of the Alpha Natural Resources, Inc. special meeting to approve the above proposal.

 

These items of business are described in the accompanying joint proxy statement/prospectus. Only stockholders of record at the close of business on          , 2008, are entitled to notice of the Alpha Natural Resources, Inc. special meeting and to vote at the Alpha Natural Resources, Inc. special meeting and any adjournments of the Alpha Natural Resources, Inc. special meeting.

 

Alpha Natural Resources, Inc.’s board of directors has approved the merger agreement and the transactions contemplated by the merger agreement, including the merger, and has determined that the merger agreement and the transactions contemplated by the merger agreement are advisable and fair to, and in the best interests of, Alpha Natural Resources, Inc. and its stockholders. Alpha Natural Resources, Inc.’s board of directors recommends that you vote for the adoption of the merger agreement.

 

In deciding to approve the merger agreement and the transactions contemplated by the merger agreement, including the merger, Alpha Natural Resources, Inc.’s board of directors considered the fairness opinion of its financial advisor delivered on July 15, 2008 and attached as Annex B to the accompanying joint proxy statement/prospectus. The fairness opinion speaks only as of its date and does not address the fairness of the merger consideration from a financial point of view at the time the merger is completed. We urge you to read “Risk Factors — Risks Relating to the Merger — The fairness opinions obtained by Cleveland-Cliffs and Alpha from their respective financial advisors will not reflect changes in circumstances between signing the merger agreement and the completion of the merger” on page 29.

 

Under Delaware law, appraisal rights will be available to Alpha Natural Resources, Inc. stockholders of record who do not vote in favor of the adoption of the merger agreement. To exercise your appraisal rights, you must strictly follow the procedures prescribed by Delaware law, submit a timely written demand for appraisal prior to the vote on the adoption of the merger agreement and otherwise comply with the requirements for exercising appraisal rights. These procedures are summarized in the accompanying joint proxy statement/prospectus.

Your vote is very important.  Whether or not you plan to attend the Alpha Natural Resources, Inc. special meeting in person, please complete, sign and date the enclosed proxy card(s) as soon as possible and return it in the postage-prepaid envelope provided, or vote your shares by telephone or over the Internet as described in the accompanying joint proxy statement/prospectus. Submitting a proxy now will not prevent you from being able to vote at the special meeting by attending in person and casting a vote. However, if you do not return or submit the proxy or vote your shares by telephone or over the Internet or vote in person at the special meeting, the effect will be the same as a vote against the proposal to adopt the merger agreement.

 

By order of the board of directors,

 

Vaughn Groves
Vice President, Secretary and General
Counsel

 

 

Please vote your shares promptly. You can find instructions for voting on the enclosed proxy card.

 

 

 

If you have questions, contact:

 

Alpha Natural Resources, Inc.

One Alpha Place, P.O. Box 2345

Abingdon, Virginia 24212

Attention: Investor Relations

(276) 619-4410

or

D.F. King & Co., Inc.

48 Wall Street, 22^nd Floor

New York, New York 10005

Banks and Brokers call collect: (212) 269-5550

All others call toll-free: (888) 887-0082

 

 

 

Abingdon, Virginia,          , 2008

 

 

 

 

CLEVELAND-CLIFFS INC

1100 Superior Avenue

Cleveland, Ohio 44114-2544

 

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON     , 2008

 

To our fellow Shareholders of Cleveland-Cliffs Inc:

 

The special meeting of shareholders of Cleveland-Cliffs Inc will be held at           on          , 2008, at          , unless postponed or adjourned to a later date. The Cleveland-Cliffs Inc special meeting will be held for the following purposes:

 

1. To adopt the Agreement and Plan of Merger, dated as of July 15, 2008, as it may be amended from time to time, by and among Cleveland-Cliffs Inc, Alpha Merger Sub, Inc., a wholly-owned subsidiary of Cleveland-Cliffs Inc, and Alpha Natural Resources, Inc., pursuant to which Alpha Merger Sub, Inc. will merge with and into Alpha Natural Resources, Inc., or, under certain circumstances, as described in Annex G, Alpha Merger Sub, Inc. will be converted from a Delaware corporation to a Delaware limited liability company, Alpha Merger Sub, LLC, and Alpha Natural Resources, Inc. will merge with and into Alpha Merger Sub, LLC, on the terms and subject to the conditions contained in the merger agreement, and approve the issuance of Cleveland-Cliffs Inc common shares in connection with the merger. A copy of the merger agreement is attached as Annex A to the accompanying joint proxy statement/prospectus;

 

2. To approve adjournments or postponements of the Cleveland-Cliffs Inc special meeting, if necessary, to permit further solicitation of proxies if there are not sufficient votes at the time of the Cleveland-Cliffs Inc special meeting to adopt the merger agreement and approve the issuance of the Cleveland-Cliffs Inc common shares on the terms and subject to the conditions contained in the merger agreement; and

 

3. To consider and take action upon any other business that may properly come before the Cleveland-Cliffs Inc special meeting or any reconvened meeting following an adjournment or postponement of the Cleveland-Cliffs Inc special meeting.

 

These items of business are described in the accompanying joint proxy statement/prospectus. Only shareholders of record at the close of business on          , 2008, are entitled to notice of the Cleveland-Cliffs Inc special meeting and to vote at the Cleveland-Cliffs Inc special meeting and any adjournments or postponements of the Cleveland-Cliffs Inc special meeting.

 

Cleveland-Cliffs Inc’s board of directors has approved the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Cleveland-Cliffs Inc common shares in connection with the merger, and has determined that the transactions contemplated by the merger agreement are advisable and fair to, and in the best interests of, Cleveland-Cliffs Inc and its shareholders. Cleveland-Cliffs Inc’s board of directors recommends that you vote for the adoption of the merger agreement and the approval of the issuance of Cleveland-Cliffs Inc common shares pursuant to the merger agreement.

 

In deciding to approve the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of the Cleveland-Cliffs Inc common shares in connection with the merger, Cleveland-Cliffs Inc’s board of directors considered the fairness opinion of its financial advisor delivered on July 15, 2008 and attached as Annex C to the accompanying joint proxy statement/prospectus. The fairness opinion speaks only as of its date and does not address the fairness of the merger consideration from a financial point of view at the time the merger is completed. We urge you to read “Risk Factors — Risks Relating to the Merger — The fairness opinions obtained by Cleveland-Cliffs and Alpha from their respective financial advisors will not reflect changes in circumstances between signing the merger agreement and the completion of the merger” on page 29.

Under Chapter 1701 of the Ohio Revised Code, dissenters’ rights will be available to Cleveland-Cliffs Inc shareholders of record who do not vote in favor of the proposal to adopt the merger agreement and approve the issuance of Cleveland-Cliffs Inc common shares. To exercise your dissenters’ rights, you must strictly follow the procedures prescribed by Chapter 1701 of the Ohio Revised Code. These procedures are summarized in the accompanying joint proxy statement/prospectus.

 

Your vote is very important.  Whether or not you plan to attend the Cleveland-Cliffs Inc special meeting in person, please complete, sign and date the enclosed proxy card(s) as soon as possible and return it in the postage-prepaid envelope provided, or vote your shares by telephone or over the Internet as described in the accompanying joint proxy statement/prospectus. Submitting a proxy now will not prevent you from being able to vote at the special meeting by attending in person and casting a vote. However, if you do not return or submit the proxy or vote your shares by telephone or over the Internet or vote in person at the special meeting, the effect will be the same as a vote against the proposal to adopt the merger agreement and approve the issuance of Cleveland-Cliffs Inc common shares in the merger.

 

By order of the board of directors,

 

George W. Hawk, Jr.
General Counsel and Secretary

 

Please vote your shares promptly. You can find instructions for voting on the enclosed proxy card.

 

 

 

If you have questions, contact:

 

Cleveland-Cliffs Inc

1100 Superior Avenue

Cleveland, Ohio 44114-2544

Attention: Investor Relations

(216) 694-5700

or

Innisfree M&A Incorporated

501 Madison Avenue, 20^th Floor

New York, New York 10022

Shareholders may call toll-free: (877) 456-3507

Banks and Brokers call collect: (212) 750-5833

 

 

 

 

Cleveland, Ohio,             , 2008

 

 

 

 

 

TABLE OF CONTENTS

 

 

The following questions and answers briefly address some commonly asked questions about the special meetings and the merger. They may not include all the information that is important to you. Cleveland-Cliffs Inc, which we refer to as Cleveland-Cliffs, and Alpha Natural Resources, Inc., which we refer to as Alpha, urge you to read carefully this entire joint proxy statement/prospectus, including the annexes and the other documents to which we have referred you. We have included page references in certain parts of this section to direct you to a more detailed description of each topic presented elsewhere in this joint proxy statement/prospectus.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

501 Madison Avenue, 20^th Floor

New York, NY 10022

Shareholders may call toll-free: (877) 456-3507

Banks and Brokers call collect: (212) 750-5833

 

48 Wall Street, 22^nd Floor

New York, NY 10005

Banks and Brokers call collect: (212) 269-5550

All others call toll-free: (888) 887-0082

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUMMARY

 

Information about Cleveland-Cliffs

 

Information about Alpha

 

The Merger

	•	$22.23 in cash, without interest; and
	•	0.95 of a fully paid, nonassessable common share of Cleveland-Cliffs.

 

Opinions of Financial Advisors (beginning on page 65 for Alpha’s financial advisor and page 77 for Cleveland-Cliffs’ financial advisor)

 

Record Date; Outstanding Shares; Shares Entitled to Vote (page 41 for Alpha and page 45 for Cleveland-Cliffs)

 

Stock Ownership of Directors and Executive Officers (page 84 for Alpha and Cleveland-Cliffs)

 

Ownership of the Combined Company After the Merger (page 85)

 

Interests of Alpha Directors and Executive Officers in the Merger (beginning on page 85)

 

Listing of Cleveland-Cliffs Common Shares and Delisting of Alpha Common Stock (page 89)

 

Appraisal Rights of Alpha Stockholders (beginning on page 89)

 

Dissenters’ Rights of Cleveland-Cliffs Shareholders (beginning on page 93)

 

Conditions to Completion of the Merger (beginning on page 94)

	•	adoption of the merger agreement by the Alpha stockholders at the Alpha special meeting;
	•	adoption of the merger agreement and approval of the issuance of Cleveland-Cliffs common shares pursuant to the terms of the merger agreement by the Cleveland-Cliffs shareholders at the Cleveland-Cliffs special meeting;
	•	the waiting period (including any extension thereof) applicable to the consummation of the merger under the Hart-Scott-Rodino Act, which is referred to as the HSR Act, must have expired or been terminated, and antitrust clearance in Turkey must have been obtained;
	•	making or obtaining consents, approvals, and actions of, filings with and notices to, the governmental entities required to consummate the merger and the other transactions contemplated by the merger agreement, the failure of which to be made or obtained is reasonably expected to have or result in a material adverse effect on Cleveland-Cliffs or Alpha;
	•	absence of any order or law of any governmental authority preventing the consummation of the merger;
	•	approval for listing on the NYSE, upon official notice of issuance, of Cleveland-Cliffs common shares to be issued in connection with the merger;

	•	continued effectiveness of the registration statement of which this joint proxy statement/prospectus is a part and the absence of any stop order or proceeding seeking a stop order by the SEC suspending the effectiveness of the registration statement;
	•	accuracy of each party’s representations and warranties in the merger agreement, except as would not reasonably be expected to have or result in a material adverse effect on the party making the representations;
	•	performance in all material respects of each party’s covenants set forth in the merger agreement required to be performed by it at or prior to the closing date of the merger; and
	•	delivery by both parties of customary officer’s certificates and tax opinions.

 

Termination of the Merger Agreement (beginning on page 113)

	•	by either Cleveland-Cliffs or Alpha if:

	•	the merger is not consummated by January 15, 2009, which date can be extended under certain circumstances to April 15, 2009 (we refer to such date, as possibly extended, as the outside date), unless the failure to consummate the merger by the outside date is the result of a breach of the merger agreement by the party seeking the termination or if such party has not yet held its special meeting of shareholders;
	•	the shareholders of Cleveland-Cliffs have voted and failed to adopt the merger agreement and approve the issuance of common shares of Cleveland-Cliffs pursuant to the merger agreement;
	•	the Alpha stockholders have voted and failed to adopt the merger agreement; or
	•	the other party breaches its representations or warranties or breaches or fails to perform its covenants set forth in the merger agreement, which breach or failure to perform results in a failure of certain of the conditions to the completion of the merger being satisfied and such breach or failure to perform is not cured within 30 days after the receipt of written notice thereof or is incapable of being cured by the outside date; or

	•	by Alpha if:

	•	prior to the receipt of its stockholders’ approval of the proposal to adopt the merger agreement, Alpha (i) receives an unsolicited written proposal after the date of the merger agreement concerning a business combination or acquisition of Alpha that the Alpha board of directors determines in its good faith judgment constitutes, or would reasonably be expected to lead to, a proposal that is more favorable to the

		Alpha stockholders than the transactions contemplated by the merger agreement, (ii) the Alpha board of directors determines in good faith that failure to take such action would be reasonably likely to be a violation of its fiduciary duties to Alpha stockholders under applicable Delaware law, (iii) provides Cleveland-Cliffs with a written notice that it intends to take such action, (iv) satisfies the conditions for withdrawing (or modifying in a manner adverse to Cleveland-Cliffs) the recommendation by its board of directors of the merger or recommending such superior proposal, and (v) concurrently with the termination of the merger agreement, enters into an acquisition agreement with a third party providing for the implementation of the transactions contemplated by such superior proposal; provided that Alpha pays a $350 million termination fee to Cleveland-Cliffs and such superior proposal did not result from Alpha’s breach of its non-solicitation obligations under the merger agreement;

	•	Cleveland-Cliffs materially breaches its covenants to convene the Cleveland-Cliffs special meeting or breaches its obligations to recommend that the Cleveland-Cliffs shareholders vote in favor of the adoption of the merger agreement and the issuance of common shares in connection with the merger; or
	•	the Cleveland-Cliffs board of directors or any committee thereof (i) withdraws or modifies, or publicly proposes to withdraw or modify, its recommendation that Cleveland-Cliffs’ shareholders adopt the merger agreement and approve the issuance of Cleveland-Cliffs common shares in connection with the merger, or (ii) recommends, adopts or approves, or proposes publicly to recommend, adopt or approve certain transactions involving Cleveland-Cliffs; or

	•	by Cleveland-Cliffs if:

	•	Alpha materially breaches its obligations not to solicit alternative takeover proposals or materially breaches its covenants to convene the Alpha special meeting or breaches its obligations to recommend that the Alpha stockholders vote in favor of the adoption of the merger agreement; or
	•	the Alpha board of directors or any committee thereof (i) withdraws or adversely modifies or publicly proposes to withdraw or adversely modify, its recommendation of the merger agreement and the transactions contemplated by the merger agreement, including the merger, or (ii) recommends, adopts or approves, or proposes publicly to recommend, adopt or approve a takeover proposal other than the merger agreement.

 

Termination Fees (beginning on page 115)

 

Material United States Federal Income Tax Consequences (beginning on page 96)

 

Accounting Treatment (page 96)

 

Risks

 

Comparison of Rights of Shareholders (beginning on page 219)

	•	subject to certain exceptions, amendments to Alpha’s certificate of incorporation require approval by Alpha’s board of directors and holders of a majority of the voting power of the corporation (or, in cases in which class voting is required, by holders of a majority of the voting power of such class), while amendments to the Cleveland-Cliffs’ articles of incorporation require approval by holders of two-thirds of the voting power of the corporation (or, in cases in which class voting is required, by holders of two-thirds of the voting power of such class);

	•	the Alpha bylaws may be amended and repealed by the Alpha board of directors, while the Cleveland-Cliffs board of directors does not have the power to amend or repeal the Cleveland-Cliffs regulations;

	•	while the Alpha stockholders do not have the right to vote cumulatively in the election of Alpha’s directors, the Cleveland-Cliffs shareholders, in contrast, may vote cumulatively in the election of Cleveland-Cliffs’ directors; and

	•	while any action by Alpha stockholders without a meeting requires written consent of holders of not less than the minimum number of votes otherwise required to authorize or take such action at a meeting of the Alpha stockholders, generally, the Cleveland-Cliffs shareholders may take action without a meeting only by unanimous written consent of all shareholders entitled to vote at such meeting.

 

FINANCIAL SUMMARY

 

Cleveland-Cliffs Market Price Data and Dividends

		Price Range of Common shares
Fiscal Year Ended		High				Low				Dividends Paid
December 31, 2006:
First Quarter		$	27.59			$	20.13			$	0.05
Second Quarter			25.22				15.70				0.0625
Third Quarter			20.05				16.58				0.0625
Fourth Quarter			24.74				18.42				0.0625
December 31, 2007:
First Quarter			32.42				23.00				0.0625
Second Quarter			46.03				32.10				0.0625
Third Quarter			45.00				28.20				0.0625
Fourth Quarter			53.15				36.75				0.0625
December 31, 2008:
First Quarter			63.89				38.63				0.0875
Second Quarter			121.95				57.32				0.0875
Third Quarter (through September 19, 2008)			118.10				63.32				0.0875

 

Alpha Market Price Data and Dividends

		Price Range of Common Stock
Fiscal Year Ended		High				Low
December 31, 2006:
First Quarter		$	23.60			$	19.25
Second Quarter			27.46				17.88
Third Quarter			20.18				14.41
Fourth Quarter			17.07				14.09
December 31, 2007:
First Quarter			15.85				12.32
Second Quarter			21.07				15.43
Third Quarter			23.50				15.92
Fourth Quarter			35.20				22.78
December 31, 2008:
First Quarter			44.58				21.92
Second Quarter			108.73				40.05
Third Quarter (through September 19, 2008)			119.30				49.59

 

Selected Historical Consolidated Financial Data of Cleveland-Cliffs

		Six Months Ended June 30,								Year Ended December 31,
		2008(b)				2007				2007(a)				2006				2005(b)				2004				2003
		(In millions, except per share data)
Financial Data:
Revenue from product sales and services		$	1,503.1			$	873.1			$	2,275.2			$	1,921.7			$	1,739.5			$	1,203.1			$	825.1
Cost of goods sold and operating expenses			(994.3	)			(681.7	)			(1,813.2	)			(1,507.7	)			(1,350.5	)			(1,053.6	)			(835.0	)
Other operating income (expense)			(56.6	)			(30.6	)			(80.4	)			(48.3	)			(32.5	)			(31.9	)			(38.4	)
Operating income (loss)			452.2				160.8				381.6				365.7				356.5				117.6				(48.3	)
Income (loss) from continuing operations			287.2				119.4				269.8				279.8				273.2				320.2				(34.9	)
Income (loss) from discontinued operations			—				—				0.2				0.3				(0.8	)			3.4				—
Income (loss) before extraordinary gain and cumulative effect of accounting change			287.2				119.4				270.0				280.1				272.4				323.6				(34.9	)
Extraordinary gain(g)			—				—				—				—				—				—				2.2
Cumulative effect of accounting changes(c)			—				—				—				—				5.2				—				—
Net income (loss)			287.2				119.4				270.0				280.1				277.6				323.6				(32.7	)
Preferred stock dividends			(1.3	)			(2.8	)			(5.2	)			(5.6	)			(5.6	)			(5.3	)			—
Income (loss) applicable to common shares			285.9				116.6				264.8				274.5				272.0				318.3				(32.7	)
Earnings (loss) per common share — basic(d)(e)(f) Continuing operations			3.04				1.43				3.19				3.26				3.08				3.70				(.43	)
Discontinued operations			—				—				—				—				(.01	)			.04				—
Cumulative effect of accounting changes and extraordinary gain			—				—				—				—				.06				—				.03
Earnings (loss) per common share			3.04				1.43				3.19				3.26				3.13				3.74				(.40	)
Earnings (loss) per common share — diluted(d)(e)(f) Continuing operations			2.73				1.14				2.57				2.60				2.46				2.92				(.43	)
Discontinued operations			—				—				—				—				(.01	)			.03				—
Cumulative effect of accounting changes and extraordinary gain			—				—				—				—				.05				—				.03
Earnings (loss) per common share — diluted(d)(e)(f)			2.73				1.14				2.57				2.60				2.50				2.95				(.40	)
Total assets		$	4,046.9			$	2,221.0			$	3,075.8			$	1,939.7			$	1,746.7			$	1,232.3			$	881.6
Debt obligations effectively serviced			774.8				158.6				505.8				47.2				49.6				9.1				34.6
Net cash from (used by) operating activities			82.9				(37.7	)			288.9				428.5				514.6				(141.4	)			42.7
Series A-2 preferred stock			19.6				172.3				134.7				172.3				172.5				172.5				—
Distributions to preferred shareholders cash dividends			1.3				2.8				5.5				5.6				5.6				5.3				—
Distributions to common shareholders cash dividends
— Per share(d)(e)(f)			.18				.13				.25				.24				.15				.03				—
— Total			16.9				10.2				20.9				20.2				13.1				2.2				—
Repurchases of common shares			—				2.2				2.2				121.5				—				6.5				—

		Six Months Ended June 30,								Year Ended December 31,
		2008(b)				2007				2007(a)				2006				2005(b)				2004				2003
		(In millions, except per share data)
Iron ore and coal production and sales statistics (tons in millions — North America; tonnes in millions — Asia-Pacific)
Production tonnage — North American iron ore			18.0				16.9				34.6				33.6				35.9				34.4				30.3
— North American coal			1.7				—				1.1				—				—				—				—
— Asia-Pacific iron ore			4.0				4.2				8.4				7.7				5.2				—				—
Production tonnage — North American iron ore (Cleveland-Cliffs share)			11.5				10.8				21.8				20.8				22.1				21.7				18.1
Sales tonnage — North American iron ore			8.2				7.9				22.3				20.4				22.3				22.6				19.2
— North American coal			1.6				—				1.2				—				—				—				—
— Asia-Pacific iron ore			3.9				4.1				8.1				7.4				4.9				—				—
Common shares outstanding (millions)(d)(e)(f)
— Average for period			94.0				81.4				83.0				84.1				86.9				85.2				82.0
— At period end			102.6				82.0				87.2				81.8				87.6				86.4				84.0

(a)		On July 31, 2007, Cleveland-Cliffs completed the acquisition of Cliffs North American Coal LLC (formerly PinnOak Resources, LLC), which is referred to as PinnOak, a producer of high-quality, low-volatile metallurgical coal. Results for 2007 include PinnOak’s results since the acquisition.

(b)		On April 19, 2005, Cleveland-Cliffs completed the acquisition of 80.4 percent of Portman, an iron ore mining company in Australia. The acquisition was initiated on March 31, 2005 by the purchase of approximately 68.7 percent of Portman’s outstanding shares. Results for 2005 include Portman’s results since the acquisition. On May 21, 2008, Portman authorized a tender offer to repurchase up to 16.5 million shares, or 9.39 percent of its common stock, and as a result of the repurchase of shares pursuant to the tender offer, Cleveland-Cliffs’ ownership interest in Portman increased from 80.4 percent to 85.2 percent on June 24, 2008. See “Information about Cleveland-Cliffs — Business — Strategic Transformation” on page 118.

(c)		Effective January 1, 2005, Cleveland-Cliffs adopted Emerging Issues Task Force, or EITF, 04-6, “Accounting for Stripping Costs Incurred during Production in the Mining Industry”.
(d)		On March 11, 2008, the board of directors of Cleveland-Cliffs declared a two-for-one stock split of its common shares. The record date for the stock split was May 1, 2008 with a distribution date of May 15, 2008. Accordingly, all common shares and per share amounts for all periods presented have been adjusted retroactively to reflect the stock split.
(e)		On May 9, 2006, the board of directors of Cleveland-Cliffs approved a two-for-one stock split of its common shares. The record date for the stock split was June 15, 2006 with a distribution date of June 30, 2006. Accordingly, all common shares and per share amounts for all periods presented have been adjusted retroactively to reflect the stock split.
(f)		On November 9, 2004, the board of directors of Cleveland-Cliffs approved a two-for-one stock split of its common shares. The record date for the stock split was December 15, 2004, with a distribution date of December 31, 2004. Accordingly, all common shares and per share amounts for all periods presented have been adjusted retroactively to reflect the stock split.
(g)		In 2003, Cleveland-Cliffs recognized a $2.2 million extraordinary gain in conjunction with the acquisition of the assets of Eveleth Mines; $3.3 million acquisition and startup costs for this same mine, renamed United Taconite LLC, which is referred to as United Taconite, and $8.7 million of restructuring charges related to a salaried employee reduction program.

 

Selected Historical Consolidated Financial Data of Alpha

																						ANR Fund IX Holdings,
																						L.P. and Alpha NR
										Alpha Natural Resources, Inc.												Holding, Inc. and
										and Subsidiaries												Subsidiaries
		Six Months Ended June 30,								Year Ended December 31,
		2008				2007				2007				2006				2005				2004				2003
		(In thousands, except per share and per ton data)
Statement of Operations Data:
Revenues:
Coal revenues		$	1,077,555			$	767,362			$	1,647,505			$	1,681,434			$	1,413,174			$	1,079,981			$	694,596
Freight and handling revenues			145,187				84,799				205,086				188,366				185,555				141,100				73,800
Other revenues			26,385				13,778				33,241				34,743				27,926				28,347				13,453
Total revenues			1,249,127				865,939				1,885,832				1,904,543				1,626,655				1,249,428				781,849
Costs and expenses:
Cost of coal sales (exclusive of items shown separately)			824,635				635,204				1,371,519				1,346,733				1,184,092				920,359				626,265
Increase in fair value of derivative instruments, net			(23,200	)			(840	)			(8,926	)			(402	)			—				—				—
Freight and handling costs			145,187				84,799				205,086				188,366				185,555				141,100				73,800
Cost of other revenues			23,125				10,396				25,817				22,982				23,675				22,994				12,488
Depreciation and amortization			89,170				73,644				159,579				140,851				73,122				55,261				35,385
Selling, general and administrative expense (exclusive of depreciation and amortization shown separately above)			36,086				27,221				58,605				67,952				88,132				40,607				21,926
Total costs and expenses			1,095,003				830,424				1,811,680				1,766,482				1,554,576				1,180,321				769,864
Income from operations			154,124				35,515				74,152				138,061				72,079				69,107				11,985

																						ANR Fund IX Holdings,
																						L.P. and Alpha NR
										Alpha Natural Resources, Inc.												Holding, Inc. and
										and Subsidiaries												Subsidiaries
		Six Months Ended June 30,								Year Ended December 31,
		2008				2007				2007				2006				2005				2004				2003
		(In thousands, except per share and per ton data)
Other income (expense):
Interest expense			(27,184	)			(20,023	)			(40,215	)			(41,774	)			(29,937	)			(20,041	)			(7,848	)
Interest income			3,023				1,094				2,340				839				1,064				531				103
Loss on early extinguishment of debt			(14,669	)			—				—				—				—				—				—
Miscellaneous income (expense)			2				554				(93	)			523				91				722				574
Total other income (expense), net			(38,828	)			(18,375	)			(37,968	)			(40,412	)			(28,782	)			(18,788	)			(7,171	)
Income from continuing operations before income taxes and minority interest			115,296				17,140				36,184				97,649				43,297				50,319				4,814
Income tax expense (benefit)			15,630				4,131				8,629				(30,519	)			18,953				5,150				898
Minority interest			(201	)			(87	)			(179	)			—				2,918				22,781				1,164
Income from continuing operations			99,867				13,096				27,734				128,168				21,426				22,388				2,752
Loss from discontinued operations			—				—				—				—				(213	)			(2,373	)			(490	)
Net income		$	99,867			$	13,096			$	27,734			$	128,168			$	21,213			$	20,015			$	2,262
Earnings per share data:
Net income (loss) per share, as adjusted(1)
Basic and diluted:
Income from continuing operations		$	1.48			$	0.20			$	0.43			$	2.00			$	0.38			$	1.52			$	0.19
Loss from discontinued operations			—				—				—				—				—				(0.16	)			(0.04	)
Net income per basic share		$	1.48			$	0.20			$	0.43			$	2.00			$	0.38			$	1.36			$	0.15
Net income per diluted share		$	1.46			$	0.20			$	0.43			$	2.00			$	0.38			$	1.36			$	0.15
Pro forma net income (loss) per share(2)
Basic and diluted:
Income from continuing operations																		$	0.35			$	0.25
Loss from discontinued operations																			—				(0.07	)
Net income per basic and diluted share																		$	0.35			$	0.18
Balance sheet data (at period end):
Cash and cash equivalents		$	406,494			$	8,655			$	54,365			$	33,256			$	39,622			$	7,391			$	11,246
Operating and working capital			311,857				109,926				157,147				116,464				35,074				56,257				32,714
Total assets			1,678,936				1,146,198				1,210,914				1,145,793				1,013,658				477,121				379,336
Notes payable and long-term debt, including current portion			545,596				445,134				446,913				445,651				485,803				201,705				84,964
Stockholders’ equity and partners’ capital			666,744				364,889				380,836				344,049				212,765				45,933				86,367
Statement of cash flows data:
Net cash provided by (used in):
Operating activities		$	179,437			$	102,308			$	225,741			$	210,081			$	149,643			$	106,776			$	54,104
Investing activities			(73,851	)			(113,763	)			(165,203	)			(160,046	)			(339,387	)			(86,202	)			(100,072	)
Financing activities			246,543				(13,146	)			(39,429	)			(56,401	)			221,975				(24,429	)			48,770
Capital expenditures			(74,207	)			(71,655	)			(126,381	)			(131,943	)			(122,342	)			(72,046	)			(27,719	)