ITEM 3. LEGAL PROCEEDINGS.
Rio Tinto. - ----------
On July 21, 1993, CCIC and Cliffs Copper Corp, a subsidiary of the Company, each received Findings of Alleged Violation and Order from the Department of Conservation and Natural Resources, Division of Environmental Protection, State of Nevada. The Findings allege that tailings materials left at the Rio Tinto Mine, located near Mountain City, Nevada, are entering State waters which the State considers to be in violation of State water quality laws. The Rio Tinto Mine was operated by Cliffs Copper Corp from 1971 to 1975 and by other companies prior to 1971. The Order requires remedial action to eliminate water quality impacts. In 1996, CCIC and other responsible parties entered into an Administrative Order on Consent (AOC) with the Nevada Division of Environmental Protection (NDEP), which provides for the completion of remedial action to occur in 1996 and 1997. CCIC and the other responsible parties have entered into a Participation Agreement to equitably share the cost of the remediation. The total projected cost of remediation is $2,335,000 of which CCIC's share is $525,000.
Summitville. - ------------
On January 12, 1993, CCIC received from the United States Environmental Protection Agency a Notice of Potential Liability at the Summitville mine site, located at Summitville, Colorado, where CCIC, as one of three joint venturers, conducted an unsuccessful copper ore exploration activity from 1966 through 1969. On June 25, 1993, CCIC received from the U.S. EPA a Notice of Potential Involvement in certain portions of the Summitville mine site. The mine site has been listed on the National Priorities List under the Comprehensive Environmental Response Compensation and Liability Act. The Company conducted no production activities at the Summitville mine site. In 1996, CCIC and one of the other venturers reached a de minimis settlement agreement with U.S. EPA, which became final in February, 1997, on payment of the $700,000 settlement amount of which CCIC's share was $350,000.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
EXECUTIVE OFFICERS OF THE REGISTRANT
Position with the Company as of March 17, 1997 --------------------
There is no family relationship between any of the executive officers of the Company, or between any of such executive officers and any of the Directors of the Company. Officers are elected to serve until successors have been elected. All of the above-named executive officers of the Company were elected effective on the effective dates listed below for each such officer.
The business experience of the persons named above for the last five years is as follows:
M. T. Moore President and Chief Executive Officer, Company, January 1, 1987 to May 9, 1988. Chairman,President and Chief Executive Officer, Company, May 10, 1988 to date.
J. S. Brinzo Executive Vice President-Finance, Company, September 1, 1989 to September 30, 1993. Senior Executive-Finance, Company, October 1, 1993 to September 30, 1995. Executive Vice President-Finance, Company, October 1, 1995 to date.
W. R. Calfee Senior Executive Vice President, Company, September 1, 1989 to September 30, 1993. Senior Executive-Commercial, Company, October 1, 1993 to September 30, 1995. Executive Vice President-Commercial, Company October 1, 1995 to date.
T. J. O'Neil Senior Vice President-Technical, Company, November 18, 1991 to September 30, 1994. Executive Vice President-CCI Operations and Technology, Company, October 1, 1994 to September 30, 1995. Executive Vice President-Operations, Company, October 1, 1995 to date.
J. W. Sanders Senior Vice President and General Manager, Copper Range Company, June, 1991 to June, 1994. President and Chief Operating Officer, Copper Range Company, July, 1994 to September 30, 1995. Senior Vice President-Technical, Company, October 1, 1995 to date.
A. S. West Senior Vice President-Sales, Company, July 1, 1988 to date.
PART II
ITEM 5.
ITEM 5. MARKET FOR REGISTRANTS' COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
The information required by this item is incorporated herein by reference and made a part hereof from that portion of the Company's Annual Report to Security Holders for the year ended December 31, 1996 contained in the material under the headings, "Common Share Price Performance and Dividends", "Investor and Corporate Information" and "Summary of Financial and Other Statistical Data", such information filed as a part hereof as Exhibits 13(h), 13(i) and 13(j), respectively.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA.
The information required by this item is incorporated herein by reference and made a part hereof from that portion of the Company's Annual Report to Security Holders for the year ended December 31, 1996 contained in the material under the headings, "Summary of Financial and Other Statistical Data" and "Notes to Consolidated Financial Statements", such information filed as a part hereof as Exhibits 13(j) and 13(g), respectively.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The information required by this item is incorporated herein by reference and made a part hereof from that portion of the Company's Annual Report to Security Holders for the year ended December 31, 1996 contained in the material under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations", such information, filed as a part hereof as Exhibit 13(a).
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The information required by this item is incorporated herein by reference and made a part hereof from that portion of the Company's Annual Report to Security Holders for the year ended December 31, 1996 contained in the material under the headings "Statement of Consolidated Financial Position", "Statement of Consolidated Income", "Statement of Consolidated Cash Flows", "Statement of Consolidated Shareholders' Equity", "Notes to Consolidated Financial Statements" and "Quarterly Results of Operations", such information filed as a part hereof as Exhibits 13(c), 13(d), 13(e), 13(f), 13(g) and 13(h), respectively.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information regarding Directors required by this Item is incorporated herein by reference and made a part hereof from the Company's Proxy Statement to Security Holders, dated March 24, 1997, from the material under the heading "Election of Directors". The information regarding executive officers required by this item is set forth in Part I hereof under the heading "Executive Officers of the Registrant", which information is incorporated herein by reference.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION.
The information required by this Item is incorporated herein by reference and made a part hereof from the Company's Proxy Statement to Security Holders, dated March 24, 1997 from the material under the headings "Executive Compensation (excluding the Compensation Committee Report on Executive Compensation)", "Pension Benefits", and the first seven paragraphs under "Agreements and Transactions".
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information required by this Item is incorporated herein by reference and made a part hereof from the Company's Proxy Statement to Security Holders, dated March 24, 1997, from the material under the heading "Securities Ownership of Management and Certain Other Persons".
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
None.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a)
(1) and (2)-List of Financial Statements and Financial Statement Schedules.
The following consolidated financial statements of the Company, included in the Annual Report to Security Holders for the year ended December 31, 1996, are incorporated herein by reference from Item 8 and made a part hereof:
Statement of Consolidated Financial Position - December 31, 1996 and 1995 Statement of Consolidated Income - Years ended December 31, 1996, 1995 and 1994 Statement of Consolidated Cash Flows - Years ended December 31, 1996, 1995 and 1994 Statement of Consolidated Shareholders' Equity - Years ended December 31, 1996, 1995 and 1994 Notes to Consolidated Financial Statements
The following consolidated financial statement schedule of the Company is included herein in Item 14(d) and attached as Exhibit 99(a).
Schedule II - Valuation and Qualifying accounts
All other schedules for which provision is made in the applicable accounting regulation of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore have been omitted.
(3) List of Exhibits - Refer to Exhibit Index on pages 20-26 which is incorporated herein by reference.
(b) There were no reports on Form 8-K filed during the three months ended December 31, 1996.
(c) Exhibits listed in Item 14(a)(3) above are included herein.
(d) Financial Statements and Schedule listed above in Item 14(a)(1) and (2) are incorporated herein by reference.
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CLEVELAND-CLIFFS INC
By: /s/ John E. Lenhard ---------------------------------------- John E. Lenhard, Secretary and Assistant General Counsel
Date: March 26, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Signatures Title Date - ---------- ----- ----
M. T. Moore Chairman, March 26, 1997 President and Chief Executive Officer and Principal Executive Officer and Director
J. S. Brinzo Executive Vice President- March 26, 1997 Finance and Principal Financial Officer
R. Emmet Vice President and March 26, 1997 Controller and Principal Accounting Officer
R. S. Colman Director March 26, 1997
J. D. Ireland, III Director March 26, 1997
G. F. Joklik Director March 26, 1997
E. B. Jones Director March 26, 1997
F. R. McAllister Director March 26, 1997
J. C. Morley Director March 26, 1997
S. B. Oresman Director March 26, 1997
J. H. Wade Director March 26, 1997
A. W. Whitehouse Director March 26, 1997
By: /s/ John E. Lenhard ------------------------------------- (John E. Lenhard, as Attorney-in-Fact)
Original powers of attorney authorizing Messrs. M. Thomas Moore, John S. Brinzo, Frank L. Hartman, and John E. Lenhard and each of them, to sign this Annual Report on Form 10-K and amendments thereto on behalf of the above-named officers and Directors of the Registrant have been filed with the Securities and Exchange Commission.
EXHIBIT INDEX
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 14(c) of this Report.
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 14(c) of this Report.
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 14(c) of this Report.
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 14(c) of this Report.
* Reflects management contract or other compensatory arrangement required to be filed as an Exhibit pursuant to Item 14(c) of this Report.
13 Selected portions of 1996 Annual Report to Security Holders
13(a) Management's Discussion and Analysis of Financial Condition and Results of Operations Filed Herewith (Page 29-39)
13(b) Report of Independent Auditors Filed Herewith (Page 40)
13(c) Statement of Consolidated Financial Position Filed Herewith (Page 41-42)
13(d) Statement of Consolidated Income Filed Herewith (Page 43)
13(e) Statement of Consolidated Cash Flows Filed Herewith (Page 44)
13(f) Statement of Consolidated Shareholders' Equity Filed Herewith (Page 45)
13(g) Notes to Consolidated Financial Statements Filed Herewith (Page 46-63)
13(h) Quarterly Results of Operations/Common Share Price Performance and Dividends Filed Herewith (Page 64)
13(i) Investor and Corporate Information Filed Herewith (Page 65)
13(j) Summary of Financial and Other Statistical Data Filed Herewith (Page 66-67)
21 Subsidiaries of the registrant Filed Herewith (Page 68-70)
23 Consent of independent auditors Filed Herewith (Page 71)
24 Power of Attorney Filed Herewith (Page 72) 27 Consolidated Financial Data Schedule submitted for Securities and Exchange Commission -- information
99 Additional Exhibits
99(a) Schedule II - Valuation and Qualifying Accounts Filed Herewith (Page 73)