Mesabi Trust 10-Q for FY2026 Q3
Mesabi Trust (MSB)
About this 10-Q
Mesabi Trust filed this 10-Q on December 12, 2025, covering the quarter ended October 31, 2025 (FY2026 Q3).
Headline figures
Quarter ended October 31, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $3.59M
- down 95.5% from $79M a year earlier
- Net income
- $2.77M
- down 96.5% from net income of $78.33M a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
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c/o Deutsche Bank Trust Company Americas Trust & Agency Services | | |
(Address of principal executive offices) | | (Zip Code) |
(
(Registrant’s telephone number, including area code)
Not applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
| Trading Symbol | Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ | | Accelerated filer ☐ |
| Smaller reporting company | |
| | Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of December 11, 2025, there were
TABLE OF CONTENTS
Forward-Looking Statements
Certain information included in this Quarterly Report on Form 10-Q contains, or incorporates by reference, not only historical information, but also “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. All such forward-looking statements, including those statements regarding estimation of iron ore pellet production, shipments, pricing, royalties and other matters, are based on information from the lessee/operator (and its parent corporation) of the mine located on the lands owned and held in trust for the benefit of the holders of units of beneficial interest of Mesabi Trust (“Mesabi Trust” or the “Trust”). These statements may be identified by the use of forward-looking words, such as “may,” “will,” “could,” “project,” “predict,” “intend,” “believe,” “anticipate,” “expect,” “estimate,” “continue,” “potential,” “plan,” “should,” “assume,” “forecast” and other similar words. Such forward-looking statements are inherently subject to known and unknown risks and uncertainties. Actual results and future developments could differ materially from the results or developments expressed in or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, volatility of iron ore and steel prices, market supply and demand, competition, environmental hazards, health and safety conditions, regulation or government action, litigation, uncertainties about estimates of reserves, general adverse business and industry economic trends, uncertainties arising from war, terrorist events and other global events, higher or lower customer demand for steel and iron ore, decisions by mine operators regarding curtailments or idling production lines or entire plants, environmental compliance uncertainties, difficulties in obtaining and renewing necessary operating permits, higher imports of steel and iron ore substitutes, processing difficulties, consolidation and restructuring in the domestic steel market, market inputs tied to indexed price adjustment factors found in some Cliffs’ customer contracts resulting in future adjustments to royalties payable to Mesabi Trust, and other factors. Further, substantial portions of royalties earned by Mesabi Trust are based on estimated prices that are subject to interim and final adjustments, which can be positive or negative, and are dependent in part on multiple price and inflation index factors under agreements to which Mesabi Trust is not a party and that are not known until after the end of a contract year. It is possible that future negative price adjustments could partially or even completely offset royalties or royalty income that would otherwise be payable to the Trust in any particular quarter, or at year-end, thereby potentially reducing cash available for distribution to the Trust’s Unitholders (as defined below) in future quarters.
For a discussion of the factors, including without limitation, those that could materially and adversely affect Mesabi Trust’s actual results and performance, see “Risk Factors” set forth on pages 4 through 19 of Mesabi Trust’s Annual Report for the fiscal year ended January 31, 2025. These risks and uncertainties are not exclusive and further information concerning the Trust, including factors that potentially could materially affect our operating results, financial condition or the market price of the Units, may emerge from time to time. Mesabi Trust undertakes no obligation, other than that imposed by law, to make any revisions to the forward-looking statements contained in this filing or to update them to reflect circumstances occurring after the date of this filing. We advise you, however, to consult any further disclosures we make on related subjects in our future Quarterly Reports on Form 10-Q, Annual Reports on Form 10-K and Current Reports on Form 8-K that we file with or furnish to the Securities and Exchange Commission.
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PART I – FINANCIAL INFORMATION
Item 1. Financial Statements. (Note 1)
Mesabi Trust
Condensed Statements of Income
Three and Nine Months Ended October 31, 2025 and 2024
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| Three Months Ended | | Nine Months Ended | ||||||||
| | October 31, | | October 31, | ||||||||
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| 2025 |
| 2024 |
| 2025 |
| 2024 | ||||
| | (unaudited) |
| (unaudited) | | (unaudited) | | (unaudited) | ||||
A. Condensed Statements of Income | | | | | | | | | | | | |
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Revenues | | | | | | | | | | | | |
Royalty income | | $ | |
| $ | |
| $ | |
| $ | |
Arbitration award | | | — | | | | | | — | | | |
Interest | |
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Total revenues | |
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Expenses | | | |
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Net income | | $ | |
| $ | |
| $ | |
| $ | |
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WEIGHTED AVERAGE NUMBER OF UNITS OUTSTANDING | | | | | | | | | | | | |
Number of units outstanding | | | | | | | | | | | ||
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Net income per unit (Note 2) | | $ | | | $ | | | $ | | | $ | |
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Distributions declared per unit (Note 4) | | $ | | | $ | | | $ | | | $ | |
See Notes to Condensed Financial Statements.
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Mesabi Trust
Condensed Balance Sheets
October 31, 2025 and January 31, 2025
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| October 31, 2025 |
| January 31, 2025 |
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| | (unaudited) | | | | | |
B. Condensed Balance Sheets | | | | | | | |
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Assets | | | | | | | |
Cash and cash equivalents | | $ | | | $ | | |
Accrued income receivable | |
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Contract asset | | | | | | | |
Prepaid expenses | |
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Current assets | |
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Fixed property, including intangibles, at nominal values | | | | | | | |
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Assignments of leased property | | | | | | | |
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Amended assignment of Peters Lease | |
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Assignment of Cloquet Leases | |
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Certificate of beneficial interest for | |
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Total assets | | $ | | | $ | | |
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Liabilities, Unallocated Reserve And Trust Corpus | | | | | | | |
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Liabilities | | | | | | | |
Distribution payable | | $ | | | $ | | |
Accrued expenses | | | | | | | |
Total liabilities | |
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Unallocated reserve | |
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Trust corpus | |
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Total liabilities, unallocated reserve and trust corpus | | $ | | | $ | | |
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See Notes to Condensed Financial Statements.
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Mesabi Trust
Condensed Statements of Cash Flows
Nine Months Ended October 31, 2025 and 2024
| | Nine Months Ended | ||||
| | October 31, | ||||
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| 2025 |
| 2024 | ||
| | | (unaudited) | | | (unaudited) |
C. Condensed Statements of Cash Flows | | | | | | |
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Operating activities | | | | | | |
Royalties received | | $ | | | $ | |
Arbitration award | | | — | | | |
Interest received | |
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Expenses paid | |
| ( | |
| ( |
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Net cash from operating activities | |
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Financing activity | | | | | | |
Distributions to unitholders | |
| ( | |
| ( |
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Net change in cash and cash equivalents | |
| ( | |
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Cash and cash equivalents, beginning of period | |
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Cash and cash equivalents, end of period | | $ | | | $ | |
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Reconciliation of net income to net cash from operating activities | | | | | | |
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Net income | | $ | | | $ | |
Increase in accrued income receivable | |
| ( | |
| ( |
Increase in contract asset | | | ( | | | ( |
(Increase) decrease in prepaid expense | |
| ( | |
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Increase (decrease) in accrued expenses | |
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| ( |
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Net cash from operating activities | | $ | | | $ | |
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Non cash financing activity | | | | | | |
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Distributions declared and payable | | $ | | | $ | |
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See Notes to Condensed Financial Statements.
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Mesabi Trust
Notes to Condensed Financial Statements
October 31, 2025 (Unaudited)
Note 1. The condensed financial statements and notes to the condensed financial statements of Mesabi Trust (the “Trust”) included herein have been prepared in accordance with the instructions to Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Trustees of Mesabi Trust (the “Trustees”), all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of (a) the results of operations for the three and nine months ended October 31, 2025 and 2024, (b) the financial position as of October 31, 2025 and (c) the cash flows for the nine months ended October 31, 2025 and 2024, have been made. For further information, refer to the financial statements and footnotes included in Mesabi Trust’s Annual Report on Form 10-K for the year ended January 31, 2025.
Note 2.
The Trust accounts for revenue in accordance with ASC 606 - Revenue from Contracts with Customers. All revenue is recognized as the performance obligations are satisfied. Mesabi Trust holds all of the interests formerly owned by Mesabi Iron Company (“MIC”), including all right, title and interest in the Amendment of Assignment, Assumption and Further Assignment of Peters Lease dated August 17, 1989 among the trustees of Mesabi Trust, Bruce D. Sherling, as Trustee in Bankruptcy for the Estate of Reserve Mining Company, and Cypress Northshore Mining Corporation, predecessor to Northshore Mining Company (referred to as the “Amended Assignment of Peters Lease” or the “Royalty Agreement”). In accordance with the Royalty Agreement, the Trust recognizes revenue for providing access to the lands and minerals only after the consideration that it is entitled to receive is determinable. The Trust is entitled to payment upon production of pellets to be sold for internal use by facilities owned by Cleveland Cliffs Inc. (“Cliffs”), the parent company of Northshore Mining Company (“Northshore” or “NMC”), or its subsidiaries. As a result, the Trust recognizes revenue for internal use pellets upon production of those pellets, which are deemed to be shipped under the Royalty Agreement, regardless of pellet grade. Pellets that are not designated for internal use by Cliffs, or its subsidiaries, are recognized as revenue upon shipment from Silver Bay, Minnesota. Shipped product and deemed shipped product are hereafter collectively referred to as “shipped.”
Disaggregation of Revenues
The following table represents a disaggregation of royalty revenue for the three and nine months ended October 31, 2025 and October 31, 2024.
| | Three Months Ended October 31, | ||||
| | 2025 | | 2024 | ||
Base overriding royalties | | $ | |
| $ | |
Bonus royalties | |
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Fee royalties | |
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Total royalty income | | $ | |
| $ | |
| | Nine Months Ended October 31, | ||||
| | 2025 | | 2024 | ||
Base overriding royalties | | $ | |
| $ | |
Bonus royalties | |
| | |
| |
Fee royalties | |
| | |
| |
Total royalty income | | $ | |
| $ | |
Base overriding royalties
The performance obligation for the base overriding royalty consists of providing NMC access to the Peters Lands, Cloquet Lands, and Mesabi Lands and the right to mine on these lands. The consideration to be received from this access under the Amended Assignment of Peters Lease relates to the volume of iron ore shipped. The Trust receives royalties at the greater of (i) the aggregate quantity of iron ore products shipped, that were mined from Mesabi Trust Lands, and (ii) a portion of the aggregate quantity of all iron ore products shipped, that were mined from any lands during the calendar year, such portion being
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The royalty percentage paid to the Trust increases as the aggregate tonnage of iron ore products shipped, attributable to the Trust in any calendar year increases. The Trust earns a
Bonus royalties
The performance obligation for the bonus royalties consists of providing NMC access to the Peters Lands, Cloquet Lands, and Mesabi Lands and the right to mine on these lands. The consideration to be received from this access under the Amended Assignment of Peters Lease relates to the volume of iron ore shipped by NMC. The Trust recognizes bonus royalties on a quarterly basis based on shipments for the fiscal quarter at the actual royalty percentage for those shipments and based on the anticipated prices for iron ore products sold under Cliffs’ customer contracts. The Trust is paid royalty bonuses when iron ore products shipped are sold at anticipated prices above a threshold price per ton. The royalty bonus is based on a percentage of the gross proceeds of product shipped. The royalty bonus percentage ranges from /2 of
AAA Arbitration 2024 Final Award
As previously reported, on October 14, 2022, Mesabi Trust initiated arbitration against Northshore, the lessee/operator of the leased lands, and its parent, Cliffs, with the American Arbitration Association (“AAA”). The Trust sought an award of damages relating to Cliffs’ and Northshore’s underpayment of royalties in 2020, 2021, and the first four months of 2022 by virtue of Cliffs’ and Northshore’s failure to use the highest priced arms’-length iron ore pellet sale from the preceding four quarters in pricing certain pellet shipments from 2020 through the first four months of 2022. The Trust also sought declaratory relief related to the Trust’s entitlement to certain documentation and to the time when Cliffs’ and Northshore’s royalty obligations accrue.
The evidentiary hearing was completed before a panel of
Pursuant to the AAA tribunal’s unanimous final award dated September 6, 2024, Northshore and Cliffs paid Mesabi Trust $
Fee royalties
Fee royalties are determined based on the volume of crude ore mined on a quarterly basis. The Trust recognizes fee royalties on a quarterly basis based on the actual crude ore mined during the fiscal quarter. Fee royalties are payable to the Mesabi Land Trust, a Minnesota land trust, which holds a
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mined after the payment of expenses to U.S. Bank N.A. for its services as the corporate trustee. The fee royalty on crude ore is based on an agreed price per ton, subject to certain indexing.
Accrued income receivable
Accrued income receivable represents royalty income earned but not yet received by the Trust. Accrued income receivable is comprised of (i) shipments during the last month of the Trust’s fiscal quarter, if any, and (ii) net positive price adjustments, if any, (which may include the sum of positive and negative price adjustments) resulting from price adjustment mechanisms in the agreements between Cliffs and its customers that determine the final sales price of the shipments from Silver Bay, Minnesota.
Contract asset and contract liability
The contract asset and contract liability are presented net in the accompanying balance sheets as both the contract asset and contract liability are derived from
Note 3. The Trustees determine whether to declare a distribution each year in April, July, October and January. The Trust’s financial statements are prepared on an accrual basis and present the Trust’s results of operations based on each of the Trust’s fiscal quarters, which end
Note 4. On October 10, 2025, the Trustees declared a distribution of $
On October 30, 2025, the Trustees received the quarterly royalty report of iron ore production and shipment during the calendar quarter ended September 30, 2025 from Cliffs. See “Recent Developments— Receipt of Quarterly Royalty Report and Royalty Payment from Cliffs” as set forth on page 15 of this Quarterly Report on Form 10-Q for the fiscal quarter ended October 31, 2025.
Each quarter, as authorized by the Agreement of Trust dated July 18, 1961, as amended (the “Agreement of Trust”), the Trustees evaluate all relevant factors, including all costs, expenses, obligations, and present and future liabilities of the Trust (whether fixed or contingent) in determining a prudent level of unallocated reserve in light of the unpredictable nature of the iron ore industry, current economic conditions and current communications from Cliffs as it relates to NMC.
Pursuant to the Agreement of Trust, the Trustees make decisions about cash distributions to Unitholders based on the royalty payments it receives from Cliffs when received, rather than as royalty income is recorded in accordance with the Trust’s revenue recognition policy. Refer to Note 3 for further information.
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As of October 31, 2025 and January 31, 2025, the unallocated cash and cash equivalents portion of the Trust’s Unallocated Reserve was comprised of the following components. Cash equivalents consists of U.S. government securities with maturities of 3 months or less as of the date of acquisition by the Trust.
| | October 31, 2025 | | January 31, 2025 | | ||
Cash and cash equivalents | | $ | | | $ | | |
Distribution payable | |
| ( | |
| ( | |
| | | | | | | |
Unallocated cash and cash equivalents | | $ | | | $ | | |
A reconciliation of the Trust’s Unallocated Reserve and Trust Corpus for the three and nine months ended October 31, 2025 and 2024 is as follows:
| | | Unallocated | | | Trust | | | |
| | | Reserve | | | Corpus | | | Total |
Balances as of July 31, 2025 |
| $ | | | $ | | | $ | |
| | | | | | | | | |
Net income | |
| | |
| — | |
| |
Distributions declared - $ | |
| ( | |
| — | |
| ( |
| | | | | | | | | |
Balances as of October 31, 2025 | | $ | | | $ | | | $ | |
| | | Unallocated | | | Trust | | | | |
| | | Reserve | | | Corpus | | | Total | |
Balances as of January 31, 2025 |
| $ | | | $ | | | $ | |
|
| | | | | | | | | | |
Net income | |
| | |
| — | |
| | |
Distributions declared - $ | |
| ( | |
| — | |
| ( | |
| | | | | | | | | | |
Balances as of October 31, 2025 | | $ | | | $ | | | $ | | |
| | | Unallocated | | | Trust | | | |
| | | Reserve | | | Corpus | | | Total |
Balances as of July 31, 2024 |
| $ | | | $ | | | $ | |
| | | | | | | | | |
Net income | |
| | |
| — | |
| |
Distributions declared - $ | |
| ( | |
| — | |
| ( |
| | | | | | | | | |
Balances as of October 31, 2024 | | $ | | | $ | | | $ | |
| | | Unallocated | | | Trust | | | |
| | | Reserve | | | Corpus | | | Total |
Balances as of January 31, 2024 |
| $ | | | $ | | | $ | |
| | | | | | | | | |
Net income | |
| | |
| — | |
| |
Distributions declared - $ | |
| ( | |
| — | |
| ( |
| | | | | | | | | |
Balances as of October 31, 2024 | | $ | | | $ | | | $ | |
Item 2. Trustees’ Discussion and Analysis of Financial Condition and Results of Operations.
This discussion should be read in conjunction with the condensed financial statements and notes presented in this Quarterly Report on Form 10-Q and the financial statements and notes in the last filed Annual Report on Form 10-K for the year ended January 31, 2025 for a full understanding of Mesabi Trust’s financial position and results of operations for the three and nine months ended October 31, 2025.
All references in this discussion and in this Quarterly Report on Form 10-Q to iron ore products “shipped” or “shipments” shall include iron ore products that are actually shipped from Silver Bay, Minnesota and/or stockpiled for intercompany use that Cleveland Cliffs Inc. (“Cliffs”) has deemed shipped, as referenced by the parties to, and in accordance with, the Amended Assignment
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of Peters Lease. Following the outcome of the 2019 arbitration, Cliffs began accruing royalty payments to the Trust for both DR pellets and standard pellets to be sold for internal use at facilities owned by Cliffs or its subsidiaries. This accrual method was upheld in the September 6, 2024 award. As a result, the Trust recognizes revenue for internal use pellets upon production of those pellets, regardless of pellet grade. Pellets produced by Northshore Mining Company (“Northshore” or “NMC”) that are not designated for internal use by Cliffs, or its subsidiaries, and instead are intended for sale to third parties in arms’-length sales, continue to be recognized as revenue upon shipment from Silver Bay, Minnesota.
Background
Mesabi Trust, formed pursuant to the Agreement of Trust, is a trust organized under the laws of the State of New York. Mesabi Trust holds all of the interests formerly owned by Mesabi Iron Company (“MIC”), including all right, title and interest in the Amendment of Assignment, Assumption and Further Assignment of Peters Lease dated August 17, 1989 among the trustees of Mesabi Trust, Bruce D. Sherling, as Trustee in Bankruptcy for the Estate of Reserve Mining Company, and Cypress Northshore Mining Corporation, predecessor to Northshore (referred to as the “Amended Assignment of Peters Lease” or the “Royalty Agreement”), the Amendment of Assignment, Assumption and Further Assignment of Cloquet Lease (the “Amended Assignment of Cloquet Lease” and together with the Amended Assignment of Peters Lease, the “Amended Assignment Agreements”), the beneficial interest in a trust organized under the laws of the State of Minnesota to administer the Mesabi Fee Lands (as defined below) as the trust corpus in compliance with the laws of the State of Minnesota on July 18, 1961 (the “Mesabi Land Trust”) and all other assets and property identified in the Agreement of Trust. The Amended Assignment of Peters Lease relates to an Indenture made as of April 30, 1915 among East Mesaba Iron Company (“East Mesaba”), Dunka River Iron Company (“Dunka River”) and Claude W. Peters (the “Peters Lease”) and the Amended Assignment of Cloquet Lease relates to an Indenture made May 1, 1916 between Cloquet Lumber Company and Claude W. Peters (the “Cloquet Lease”).
The Agreement of Trust specifically prohibits the Trustees of the Mesabi Trust (the “Trustees”) from entering into or engaging in any business. This prohibition applies even to business activities the Trustees may deem necessary or proper for the preservation and protection of the Trust Estate. Accordingly, the Trustees’ activities in connection with the administration of Trust assets are limited to collecting income, paying expenses and liabilities, distributing net income to the holders of Certificates of Beneficial Interest in Mesabi Trust (“Unitholders”) after the payment of, or provision for, such expenses and liabilities, and protecting and conserving the assets held by the Trust.
The Trustees do not intend to expand their responsibilities beyond those permitted or required by the Agreement of Trust, as amended by the Amendment to the Agreement of Trust dated October 25, 1982 (the “Agreement of Trust”), and those required under applicable law. Mesabi Trust has no employees, but it engages independent consultants to assist the Trustees in, among other things, monitoring the volume and sales prices of iron ore products shipped, based on information supplied to the Trustees by Northshore, the lessee/operator of the lands leased under the Peters Lease and Cloquet Lease (the “Peters Lease Lands” and “Cloquet Lease Lands,” respectively) and the 20% fee interest of certain lands that are particularly described in, and subject to a mining lease under, the Peters Lease (the “Mesabi Fee Lands,” and together with the Peters Lease Lands and Cloquet Lease Lands, the “Mesabi Trust Lands”), and its parent company, Cliffs. References to Northshore or NMC in this quarterly report, unless the context requires otherwise, are applicable to Cliffs as well.
Leasehold royalty income constitutes the principal source of the Trust’s revenue. The income of the Trust is highly dependent upon the activities and operations of Northshore. Royalty rates and the resulting royalty payments received by the Trust are determined in accordance with the terms of the Trust’s leases and assignments of leases.
Three types of royalties, as well as royalty bonuses, comprise the Trust’s leasehold royalty income:
| ● | Base overriding royalties. Base overriding royalties have historically constituted the majority of the Trust’s royalty income. Base overriding royalties are determined by both the volume and selling price of iron ore products shipped. Northshore is obligated to pay the Trust base overriding royalties in varying amounts, based on the volume of iron ore products shipped. Base overriding royalties are calculated as a percentage of the gross proceeds of iron ore products produced at Mesabi Trust Lands (and to a limited extent other lands) and shipped. The percentage ranges from 2-1/2% of the gross proceeds for the first one million tons of iron ore products shipped annually to 6% of the gross proceeds for all iron ore products in excess of four million tons shipped annually. Base overriding royalties typically are subject to interim and final price adjustments under Cliffs’ customer contracts (to the extent they are utilized) and, as described elsewhere in this report, such adjustments may be positive or negative. |
| ● | Royalty bonuses. The Trust earns royalty bonuses when iron ore products shipped are sold at prices above a threshold price per ton. The royalty bonus is based on a percentage of the gross proceeds of product shipped. The threshold price is adjusted (but not below $30.00 per ton) on an annual basis for inflation and deflation (the “Adjusted Threshold Price”). The Adjusted Threshold Price is $69.41 per ton for calendar year 2025 and was $67.75 per ton for calendar year 2024. The royalty bonus percentage ranges from 1/2 of 1% of the gross proceeds (on all tonnage shipped for sale at prices between the Adjusted Threshold Price and $2.00 above the Adjusted Threshold Price) to 3% of the gross proceeds (on all tonnage shipped for sale at prices $10.00 or more |
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| above the Adjusted Threshold Price). Royalty bonuses typically are subject to price adjustments under Cliffs’ customer contracts (to the extent they are utilized) and, as described elsewhere in this report, such adjustments may be positive or negative. |
| ● | Fee royalties. Fee royalties have historically constituted a smaller component of the Trust’s total royalty income. Fee royalties are payable to the Mesabi Land Trust, a Minnesota land trust, which holds a 20% interest as fee owner in the Amended Assignment of Peters Lease. Mesabi Trust holds the entire beneficial interest in the Mesabi Land Trust for which U.S. Bank N.A. acts as the corporate trustee. Mesabi Trust receives the net income of the Mesabi Land Trust, which is generated from royalties on the amount of crude ore mined after the payment of expenses to U.S. Bank N.A. for its services as the corporate trustee. Crude ore is the source of iron oxides used to make iron ore pellets and other products. The fee royalty on crude ore is based on an agreed price per ton, subject to certain indexing. |
| ● | Minimum advance royalties. Northshore’s obligation to pay base overriding royalties and royalty bonuses with respect to the sale of iron ore products generally accrues upon the shipment of those products. However, regardless of whether any shipment has occurred, Northshore is obligated to pay to Mesabi Trust a minimum advance royalty. Each year, the amount of the minimum advance royalty is adjusted (but not below $500,000 per annum) for inflation or deflation. The minimum advance royalty is $1,157,261 for calendar year 2025 and was $1,129,615 for calendar year 2024. Until overriding royalties (and royalty bonuses, if any) for a particular year equal or exceed the minimum advance royalty for the year, Northshore must make quarterly payments of up to 25% of the minimum advance royalty for the year. Because minimum advance royalties are essentially prepayments of base overriding royalties and royalty bonuses earned each year, any minimum advance royalties paid in a fiscal quarter are recouped by credits against base overriding royalties and royalty bonuses earned in later fiscal quarters during the year. |
The current royalty rate schedule became effective on August 17, 1989 pursuant to the Amended Assignment Agreements, which the Trust entered into with Cyprus Northshore Mining Corporation (“Cyprus NMC”). Pursuant to the Amended Assignment Agreements, overriding royalties are determined by both the volume and selling price of iron ore products shipped. In 1994, Cyprus NMC was sold by its parent corporation to Cliffs and renamed Northshore Mining Company. Cliffs now operates Northshore as a wholly owned subsidiary.
Under the relevant agreements, Northshore has the right to mine and ship iron ore products from lands other than Mesabi Trust Lands. Northshore alone determines whether to conduct mining operations on Mesabi Trust Lands and/or such other lands based on its current mining and engineering plan. The Trustees do not exert any influence over mining operational decisions. To encourage the use of iron ore products from Mesabi Trust Lands, Mesabi Trust receives royalties on stated percentages of iron ore shipped, whether or not the iron ore products are from Mesabi Trust Lands. Mesabi Trust receives royalties at the greater of (i) the aggregate quantity of iron ore products shipped that were mined from Mesabi Trust Lands, and (ii) a portion of the aggregate quantity of all iron ore products shipped that were mined from any lands, such portion being 90% of the first four million tons shipped during such year, 85% of the next two million tons shipped during such year, and 25% of all tonnage shipped during such year in excess of six million tons. The royalty percentage paid to the Trust increases as the aggregate tonnage of iron ore products shipped, attributable to the Trust, in any calendar year increases past each of the ton volume thresholds. Assuming a consistent sales price per ton throughout a calendar year, shipments of iron ore product attributable to the Trust later in the year generate a higher royalty to the Trust, as total shipments for the year exceed the one million ton thresholds.
During the course of its typical fiscal year, historically some portion of royalties expected to be paid to Mesabi Trust would be based in part on estimated prices for certain iron ore products sold under some of the Cliffs’ customer contracts. Generally, Cliffs’ customer contracts have typically used estimated prices which are subject to interim and final pricing adjustments, which can be positive or negative, and are dependent in part on multiple price and inflation index factors that are not known until after the end of a contract year. Even though Mesabi Trust is not a party to the Cliffs’ customer contracts, these adjustments can result in significant variations in royalties payable to Mesabi Trust (and, in turn, the resulting amount available for distribution to Unitholders by the Trust) from quarter to quarter and on a comparative historical basis, and these variations, which can be positive or negative, cannot be predicted by the Trust. In either case, when used in Cliffs’ third party customer contracts, these price adjustments would impact future royalties payable to the Trust and, in turn, would impact cash reserves that may become available for distribution to Unitholders.
Historically, sales volumes under most of its multi-year supply agreements with Cliffs’ customers, in general, are largely dependent on customer requirements and contain a base price that is adjusted annually using one or more adjustment factors. The factors that could result in price adjustments under Cliffs’ customer contracts include changes in the Platts 62% Price, hot-rolled coil steel price, the Atlantic Basin pellet premium, published Platts international indexed freight rates and changes in specified producer price indices, including those for industrial commodities, fuel and steel.
As also described elsewhere in this report, the Trust receives a bonus royalty equal to a percentage of the gross proceeds of iron ore products (mined from Mesabi Trust Lands) shipped and sold at prices above the Adjusted Threshold Price. Although 98.3% of all the iron ore products shipped during calendar 2024 was sold at prices higher than the Adjusted Threshold Price, the Trustees are unable to project whether Cliffs will continue to be able to sell iron ore products at prices above the applicable Adjusted Threshold Price, entitling the Trust to any future bonus royalty payments.
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In order to calculate the royalties owed by Northshore to Mesabi Trust, the 1989 Royalty Agreement requires that Northshore make sales of iron ore products to third parties on an arms’-length basis without regard to any other business relationship between Northshore and the third-party buyer of the iron ore products. In order to calculate royalties on less than arms’-length sales (including sales from Northshore to Cliffs’ corporate affiliates), the Royalty Agreement requires reference to the highest contract price obtained by Northshore in the preceding four calendar quarters in a sale to a buyer not affiliated with Northshore and made on an arms’-length basis. Since Cliffs’ acquisition of ArcelorMittal USA in late-2020, and accelerating after Cliffs’ Toledo HBI plant came online in mid-2021, Northshore has increased the proportion of iron ore mined from the Mesabi Trust Lands that it sells to Cliffs’ corporate affiliates and decreased the proportion of such iron ore that it sells to third parties in arms’-length transactions. Cliffs’ public statements beginning in October 2021 have indicated that Cliffs will be limiting the tonnage of iron ore pellets that it sells to third parties from all of its mines, and particularly Northshore, which Cliffs idled from May 2022 to April 2023. Cliffs also said it will continue to run Northshore as a swing operation. For the twelve-month period ended December 31, 2023, Cliffs has reported to the Trust two low volume shipments of iron ore pellets (produced from iron ore principally mined from Mesabi Trust Lands) to a single third-party customer. Cliffs’ quarterly royalty report used the highest price from those two transactions to set the price for royalty purposes for subsequent shipments intended for Cliffs’ affiliates internal consumption beginning in July 2023. For the twelve-month period ended December 31, 2024, Cliffs has reported to the Trust four low volume shipments of iron ore pellets (produced with iron ore principally mined from Mesabi Trust Lands) to a single third-party customer. Cliffs’ quarterly royalty report used the highest price from certain of those transactions to set the price for royalty purposes for subsequent shipments intended for Cliffs’ affiliates’ internal consumption beginning in July 2024, subject to the newly reported arms’-length third-party customer sales transactions thereafter. According to Cliffs’ quarterly royalty reports, beginning with the third calendar quarter of 2025, the highest contract price obtained by Northshore in the preceding four calendar quarters in a sale to a buyer not affiliated with Northshore and made on an arms’-length basis decreased, resulting in a lower bonus royalty rate for the Trust beginning July 1, 2025. The Trust is continuing to evaluate whether such transactions meet the requirements of the Royalty Agreement. Without consistent arms’-length sales from Northshore to third parties, the calculation of royalties on iron ore Northshore ships to Cliffs’ affiliates could be uncertain under the Royalty Agreement, which could in turn result in potential disputes regarding the amount of royalties owed to the Trust.
Deutsche Bank Trust Company Americas, the Corporate Trustee of Mesabi Trust, performs certain administrative functions for Mesabi Trust. The Trust maintains a website at www.mesabi-trust.com. The Trust makes available (free of charge) its annual, quarterly and current reports (and any amendments thereto) filed with the SEC through its website as soon as reasonably practicable after electronically filing or furnishing such material with or to the SEC.
Results of Operations
Comparison of Iron Ore Pellet Production and Shipments for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
As shown in the table below, during the three months ended October 31, 2025, production and shipments of iron ore pellets at Northshore from Mesabi Trust Lands both totaled 915,605 tons. By comparison, pellet production and shipments for the comparable period in 2024 were both 1,066,665 tons. The decrease in production and shipments is attributable to lower demand from Northshore’s customers as compared to the prior comparable period. For the three months ended October 31, 2025, 100% of shipments originated from Trust lands.
|
| Pellets Produced from |
| Pellets Shipped from |
|
| | Trust Lands | | Trust Lands |
|
Three Months Ended | | (Tons) | | (Tons) |
|
October 31, 2025 |
| 915,605 |
| 915,605 | |
October 31, 2024 | | 1,066,665 | | 1,066,665 | |
As shown in the table below, during the nine months ended October 31, 2025, production and shipments of iron ore pellets at Northshore from Mesabi Trust Lands both totaled 2,496,746 tons. By comparison, pellet production and shipments for the comparable period in 2024 were both 3,019,695 tons. The decrease in production and shipments is primarily attributable to Northshore being in an extended maintenance shut down in February 2025. For the nine months ended October 31, 2025, 100% of shipments originated from Trust lands.
|
| Pellets Produced from |
| Pellets Shipped from |
|
| | Trust Lands | | Trust Lands |
|
Nine Months Ended | | (Tons) | | (Tons) |
|
October 31, 2025 |
| 2,496,746 |
| 2,496,746 | |
October 31, 2024 |
| 3,019,695 |
| 3,019,695 | |
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Comparison of Royalty Income for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
As reflected in the table below, the Trust’s total royalty income for the three months ended October 31, 2025 decreased by $3,957,757 to $3,390,609 as compared to the three months ended October 31, 2024. The decrease in total royalty income is attributable to a decrease in both pricing and shipments of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024.
The table below shows that the base overriding royalties decreased $1,886,191 and the bonus royalties decreased by $2,125,658 for the three months ended October 31, 2025, as compared to the three months ended October 31, 2024. Fee royalties increased by $54,092 over the same period. The decrease in the base overriding royalties is attributable to a decrease in both pricing and shipments of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The decrease in the bonus royalty is attributable to a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The increase in the fee royalties is attributable to an increase in the royalty rate paid during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024.
The table below summarizes the components of Mesabi Trust’s total royalty income for the three months ended October 31, 2025 and October 31, 2024, respectively:
| | Three Months Ended October 31, | | ||||
| | 2025 | | 2024 | | ||
Base overriding royalties | | $ | 2,263,892 |
| $ | 4,150,083 | |
Bonus royalties | |
| 902,047 | |
| 3,027,705 | |
Fee royalties | |
| 224,670 | |
| 170,578 | |
Total royalty income | | $ | 3,390,609 |
| $ | 7,348,366 | |
As reflected in the table below, the Trust’s total royalty income for the nine months ended October 31, 2025 decreased by $6,456,708 to $13,156,985 as compared to the nine months ended October 31, 2024. The decrease in royalty income is attributable to Northshore being in an extended maintenance shut down in February 2025 along with a decrease in both pricing and shipments of iron ore during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024.
The table below shows that the base overriding royalties decreased $3,226,781 and the bonus royalties decreased by $3,320,181 for the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. Fee royalties increased by $90,254 over the same period. The decrease in the base overriding royalties is attributable to an extended maintenance shut down at Northshore in February 2025 along with a decrease in both pricing and shipments of iron ore during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. The decrease in the bonus royalty is attributable to a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the nine months ended October 31, 2025 as compared to the nine months ended October 31, 2024. The increase in the fee royalties is attributable to an increase in the royalty rate paid during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024.
The table below summarizes the components of Mesabi Trust’s total royalty income for the nine months ended October 31, 2025 and October 31, 2024, respectively:
| | Nine Months Ended October 31, | | ||||
| | 2025 | | 2024 | | ||
Base overriding royalties | | $ | 7,905,014 | | $ | 11,131,795 | |
Bonus royalties | | | 4,704,321 | | | 8,024,502 | |
Fee royalties | | | 547,650 | | | 457,396 | |
Total royalty income | | $ | 13,156,985 | | $ | 19,613,693 | |
Comparison of Net Income, Expenses and Distributions for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
Net income for the three months ended October 31, 2025 was $2,767,463, a decrease of $75,558,062 as compared to the three months ended October 31, 2024. The decrease in net income for the three months ended October 31, 2025 is primarily attributable to the recognition of revenue related to the AAA arbitration award in the prior period and a decrease in royalty income due to a decrease in both pricing and shipments, as well as a reduction in the bonus royalty rate of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The Trust’s expenses for the three months ended October 31, 2025 were $822,987, an increase of $146,672 compared to the expenses for the three months ended October 31, 2024. The increase in
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expenses was primarily attributable to an increase in legal fees for the three months ended October 31, 2025, as compared to the prior comparable period. The table below summarizes the Trust’s income and expenses for the three months ended October 31, 2025 and October 31, 2024, respectively.
| | Three Months Ended October 31, |
| ||||
| | 2025 | | 2024 |
| ||
Total royalty income |
| $ | 3,390,609 |
| $ | 7,348,366 | |
Arbitration award | | | — | | | 71,185,029 | |
Interest income | |
| 199,841 | |
| 468,445 | |
Total revenues | |
| 3,590,450 | |
| 79,001,840 | |
Expenses | |
| 822,987 | |
| 676,315 | |
Net income |
| $ | 2,767,463 |
| $ | 78,325,525 | |
Net income for the nine months ended October 31, 2025 was $11,142,554, a decrease of $76,064,649 as compared to the nine months ended October 31, 2024. The decrease in net income for the nine months ended October 31, 2025 is primarily due to the recognition of revenue related to the AAA arbitration award in the prior period and a decrease in royalty income attributed to an extended maintenance shut down in February 2025 along with a decrease in both pricing and shipments of iron ore and a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. The Trust’s expenses for the nine months ended October 31, 2025 were $2,789,193, a decrease of $1,745,926 compared to the expenses for the nine months ended October 31, 2024. The decrease in expenses was primarily attributable to a decrease in legal fees for the nine months ended October 31, 2025 as compared to the prior comparable period during which the Trust was engaged in active arbitration. The table below summarizes the Trust’s income and expenses for the nine months ended October 31, 2025 and October 31, 2024, respectively.
| | Nine Months Ended October 31, |
| ||||
| | 2025 | | 2024 |
| ||
Total royalty income |
| $ | 13,156,985 |
| $ | 19,613,693 | |
Arbitration award | | | — | | | 71,185,029 | |
Interest income | |
| 774,762 | |
| 943,600 | |
Total revenues | |
| 13,931,747 | |
| 91,742,322 | |
Expenses | |
| 2,789,193 | |
| 4,535,119 | |
Net income |
| $ | 11,142,554 |
| $ | 87,207,203 | |
As presented on the “Trust’s Condensed Statements of Income” on page 3 of this quarterly report, the Trust’s net income per unit decreased $5.7590 per unit to $0.2109 per unit for the fiscal quarter ended October 31, 2025, as compared to the fiscal quarter ended October 31, 2024. On October 10, 2025, the Trust declared a distribution of $0.34 per unit payable on November 20, 2025 to Unitholders of record on October 30, 2025. Comparatively, the Trust declared a distribution of $0.39 per unit during the quarter ended October 31, 2024. During the nine months ended October 31, 2025 and October 31, 2024, the Trust declared distributions totaling $1.02 per unit to Unitholders of record and $0.98, respectively.
On a quarterly basis, the Trustees review a variety of financial and economic data and information impacting the Trust, and upon the Trustees’ determination, distributions may be declared approximately eleven weeks after the Trustees receive a quarterly royalty report from Northshore and Cliffs and the Trust receives the actual royalty payment with respect to royalty income that is payable for iron ore shipments through the end of each prior calendar quarter. Royalty payments may include pricing adjustments with respect to shipments made during prior periods. The Trust accounts for and reports accrued income receivable based on shipments during the last month of each of the Trust’s fiscal quarters (April, July, October and January) and price adjustments under Cliffs’ customer contracts (which can be positive or negative and can result in significant variations in royalties received by Mesabi Trust and cash available for distribution to Unitholders) as reported to the Trust by Northshore. The Trust accounts for these amounts by using estimated prices and reports such amounts as revenue even though accrued income receivable is not available for distribution to Unitholders until it is received by the Trust. Accordingly, distributions declared by the Trust are not equivalent to the Trust’s net income during the periods reported in this Quarterly Report on Form 10-Q.
Comparison of Unallocated Reserve as of October 31, 2025, October 31, 2024 and January 31, 2025
As set forth in the table below, Unallocated Reserve decreased from $95,324,736 as of October 31, 2024 to $21,087,860 as of October 31, 2025. The decrease in Unallocated Reserve as of October 31, 2025, as compared to October 31, 2024, is primarily the result of a decrease in unallocated cash and cash equivalents and a decrease in accrued income receivable. The decrease in the unallocated cash and cash equivalents portion of the Unallocated Reserve is in part attributable to AAA arbitration award being received as of October 31, 2024, which was subsequently distributed to unitholders. The decrease in the accrued income receivable portion of the Unallocated Reserve is attributable to a decrease in pricing, including a lower bonus royalty rate, in the last month of the fiscal quarter ended October 31, 2025 as compared to the prior comparable period.
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| | October 31, | | % increase | | ||||
|
| 2025 |
| 2024 |
| (decrease) | | ||
Accrued Income Receivable | | $ | 1,522,367 | | $ | 3,883,400 |
| (60.8)% | |
Contract Asset | | | 1,055,605 | | | 669,276 | | 57.7% | |
Unallocated Cash and Cash Equivalents | | | 18,731,120 | | | 90,793,345 |
| (79.4)% | |
Accrued Expenses, net | |
| (221,232) | |
| (21,285) |
| 939.4% | |
Unallocated Reserve | | $ | 21,087,860 | | $ | 95,324,736 |
| (77.9)% | |
The Trust’s Unallocated Reserve as of October 31, 2025 decreased by $2,239,857 to $21,087,860, as compared to the fiscal year ended January 31, 2025. The decrease in the Unallocated Reserve as of October 31, 2025, as compared to January 31, 2025, is the result of a decrease in unallocated cash and cash equivalents offset by an increase in the accrued income receivable and contract asset. The decrease in the unallocated cash and cash equivalents portion of the Unallocated Reserve is attributable to the extended maintenance shut down at Northshore in February 2025 during which minimal mining, production and shipment occurred. The increase in the accrued income receivable portion of the Unallocated Reserve is attributable to an increase in shipments in the last month of the fiscal quarter ended October 31, 2025 as compared to the last month of the fiscal year ended January 31, 2025. The increase in the contract asset portion of the Unallocated Reserve is attributable to estimates of variable consideration related to the shipments calendar year-to-date through October 31, 2025 as compared to only one month of calendar year-to-date shipments for the fiscal year ended January 31, 2025. See “Note 2” for further discussion of contract asset and contract liability.
| | | | % increase |
| ||||
|
| October 31, 2025 |
| January 31, 2025 |
| (decrease) | | ||
Accrued Income Receivable | | $ | 1,522,367 | | $ | 1,160,761 |
| 31.2% | |
Contract Asset | | | 1,055,605 | | | 240,642 |
| 338.7% | |
Unallocated Cash and Cash Equivalents | |
| 18,731,120 | |
| 22,140,471 | | (15.4)% | |
Accrued Expenses, net | | | (221,232) | | | (214,157) |
| (3.3)% | |
Unallocated Reserve | | $ | 21,087,860 | | $ | 23,327,717 |
| (9.6)% | |
It is possible that future negative price adjustments could offset, or even eliminate, future royalties or royalty income that would otherwise be payable to the Trust in any particular quarter, or at year end, thereby potentially reducing cash available for distribution to the Trust’s Unitholders in future quarters. See the discussion under the heading “Risk Factors” beginning on page 4 of the Trust’s Annual Report on Form 10-K for the fiscal year ended January 31, 2025 (filed April 24, 2025).
Each quarter, as authorized by the Agreement of Trust, the Trustees will reevaluate all relevant factors including all costs, expenses, obligations, and present and future liabilities of the Trust (whether fixed or contingent) in determining a prudent level of unallocated reserve in light of the unpredictable nature of the iron ore industry, current and projected future mining operations and current economic conditions. Although the actual amount of the Unallocated Reserve will fluctuate from time to time and may increase or decrease from its current level, it is currently anticipated that future distributions will be highly dependent upon royalty income as it is received and the level of Trust expenses. The amount of future royalty income will be a function of the volume of iron ore products produced or shipped and the dollar amount from the sale to third-party customers in bona fide transactions by Northshore that meet the requirements of the royalty agreement. Production and shipping activity is greatly reduced during the winter months. As previously disclosed, on April 25, 2023, Cliffs announced that “higher levels of steel production have led to the partial restart of some operations at … [its] iron ore mining and pelletizing swing facility at Northshore earlier this month.” Cliffs also announced that it “…will continue to treat that facility as our swing operation. And at this time, we still do not expect to operate Northshore in full any time this year.” The Trustees have not been provided with any additional information regarding the anticipated volume of production, stockpiling or shipping of iron ore products at the Northshore operations in Babbitt and Silver Bay, Minnesota. General adverse business and industry economic trends, uncertainties arising from war, terrorist events and other global events, higher or lower customer demand for steel and iron ore, decisions by mine operators regarding curtailments or idling production lines or entire plants, environmental compliance uncertainties, difficulties in obtaining and renewing necessary operating permits, higher imports of steel and iron ore substitutes, processing difficulties and consolidation and restructuring in the domestic steel market may adversely affect the amount and timing of such future shipments and sales. The Trustees will continue to monitor the economic and other circumstances of the Trust to strike a responsible balance between distributions to Unitholders and the need to maintain adequate reserves at a prudent level, given the unpredictable nature of the iron ore and steel industry, the Trust’s dependence on the actions of Cliffs/Northshore, and the fact that the Trust essentially has no other liquid assets.
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Recent Developments
Commencement of Arbitration
On September 26, 2025, Mesabi Trust initiated arbitration against Northshore and its parent, Cliffs (Northshore and Cliffs, jointly, the “Operator”), the lessee/operator of the leased lands. Mesabi Trust commenced the arbitration proceeding through the American Arbitration Association. Mesabi Trust seeks damages and declaratory relief relating to the Operator’s idling of Northshore’s operations from May 2022 to April 2023 and underpayment of royalties on intercompany shipments from 2023 through the present.
Receipt of Quarterly Royalty Report and Royalty Payment Received
On October 30, 2025, the Trustees of Mesabi Trust received the quarterly royalty report (“Royalty Report”) from Cliffs, the parent company of Northshore.
As reported to Mesabi Trust by Cliffs in the Royalty Report, based on shipments of iron ore products by Northshore during the three months ended September 30, 2025, Mesabi Trust was credited with a base royalty of $2,817,500. For the three months ended September 30, 2025, Mesabi Trust was also credited with a bonus royalty in the amount of $973,410. Cliffs reported that no adjustments were made in the third quarter. In addition, a royalty payment of $214,232 was paid to the Mesabi Land Trust. Accordingly, the total royalty payments received by Mesabi Trust on October 30, 2025 from Cliffs were $4,005,142.
The royalties paid to Mesabi Trust are based on the volume of iron ore pellets and other products produced or shipped during the quarter and the year to date, the pricing of iron ore product sales, and the percentage of iron ore pellet production and shipments from Mesabi Trust lands rather than from non-Mesabi Trust lands. In the third calendar quarter of 2025, Cliffs credited Mesabi Trust with 987,370 tons of iron ore shipped, as compared to 972,154 tons shipped or produced during third calendar quarter of 2024. Cliffs’ Royalty Report reported three sale transactions of iron ore pellets shipped to a single third-party during September 2025, which are subject to continued due diligence review. Cliffs’ Royalty Report also indicated that royalty calculations are based on prices that are subject to change.
The volume of iron ore pellets (and other iron ore products) produced or shipped by Northshore varies from quarter to quarter and year to year based on a number of factors, including, among others, Cliffs’ decisions to idle Northshore operations (which occurred from May 2022 until April 2023), the requested delivery schedules of customers (including affiliates), general economic conditions in the iron ore industry, and production schedules and weather conditions on the Great Lakes. These multiple factors can result in significant variations in royalties received by Mesabi Trust (and in turn, the resulting funds available for distribution to Unitholders by Mesabi Trust) from quarter to quarter and from year to year. These variations, which can be positive or negative, cannot be predicted by the Trustees of Mesabi Trust. Based on the above factors, and as indicated by Mesabi Trust’s historical distribution payments, the royalties received by Mesabi Trust, and the distributions paid to Unitholders, if any, in any particular quarter are not necessarily indicative of royalties that will be received, or distributions that will be paid, if any, in any subsequent quarter or full year.
Trust’s Prior Announcement of a Thirty-Four Cents Distribution
On October 10, 2025, Mesabi Trust issued a press release announcing that the Trustees of Mesabi Trust declared a distribution of thirty-four cents ($0.34) per Unit of Beneficial Interest payable on November 20, 2025 to Mesabi Trust Unitholders of record at the close of business on October 30, 2025. This compares to a thirty-nine cent ($0.39) per Unit distribution declared for the same period last year.
Cleveland-Cliffs Announcement of Replacing Aluminum with Steel in Automotive Stamping Equipment
On October 29, 2025, Cliffs announced that it successfully completed a production trial in collaboration with a major automotive OEM, in which Cliffs’ exposed steel parts were stamped with no defects using the OEM’s existing aluminum-forming equipment. Cliffs press release indicated that the trial marks a significant milestone in demonstrating that Cliffs steel can effectively replace aluminum in critical automotive applications without the need for costly retooling. Cliffs described this as a major breakthrough in the wake of recent major disruptions, presumably long-lasting, in the aluminum supply chain.
According to Cliffs’ press release, this achievement was made possible through Cliffs’ industry-leading technical service and application engineering teams, who worked directly with the OEM’s production and tooling specialists to fine-tune the material design and forming parameters. According to Cliffs, the result was a smooth transition from aluminum to steel, with no changes required to the stamping line.
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Cliffs also indicated that it has already moved from the trial phase to routine production and delivery of regular orders to the client. Cliffs said it has also received inquiries from other clients for programs that will replace aluminum with Cliffs steel, underscoring the growing confidence among automotive OEM’s in domestic steel and Cliffs’ supply reliability.
Cleveland-Cliffs Announcement of Pricing its Underwritten Public Offering
On October 30, 2025, Cliffs announced the pricing of its underwritten public offering (the “Offering”) of 75,000,000 common shares, par value $0.125 per share (the “Common Shares”), for expected gross proceeds of $964 million, before discounts and expenses. In addition, Cliffs has also granted the underwriter a 30-day option to purchase up to an additional 11,250,000 Common Shares. The Offering was expected to close on October 31, 2025, subject to the satisfaction of customary closing conditions. Cliffs said it intends to use the net proceeds from the Offering for the repayment of borrowings under its asset-based credit facility, with any remaining net proceeds for general corporate purposes.
Cleveland-Cliffs Announcement of POSCO as MOU Strategic Partner
On October 30, 2025, Cliffs announced that POSCO, Korea's largest steelmaker and the world's third largest steelmaker outside of China, is its strategic partner under the previously disclosed transformative Memorandum of Understanding. The MoU between the two companies was executed on September 17, 2025. Cliffs reported that with the recent completion of the new U.S. and Korea trade agreement, cooperation between the two nations' industrial sectors will be further reinforced by the POSCO-Cliffs partnership.
According to Cliffs’ press release, the partnership will allow POSCO to support and grow its established U.S. customer base while ensuring that its products meet U.S. trade and origin requirements. Cliffs said it expects the ultimate outcome of this MoU to be highly accretive to shareholders.
Cliffs’ press release reported that a formal announcement on a definitive agreement is expected in the fourth quarter of 2025 or first quarter in 2026 with closing expected in 2026.
Northshore’s Proposed Project at Mile Post 7 Tailings Basin and Minnesota Litigation Update
On March 1, 2024, the Minnesota Department of Natural Resources (“DNR”) issued an order concluding that Northshore’s proposed project relating to the Milepost 7 tailings basin does not require an environmental impact statement (“EIS”) to proceed. On February 3, 2025, the Minnesota Court of Appeals reversed the DNR’s decision that an EIS was not needed, concluding it was “arbitrary and capricious” and in error. The Court remanded the case to the DNR for a new determination of whether the cumulative potential environmental impact of both the proposed project and the ongoing and future effects of the Milepost 7 tailings basin requires an EIS for the proposed project.
On March 5, 2025, both the DNR and Northshore petitioned the Minnesota Supreme Court to review the Court of Appeals’ decision. On May 13, 2025, the Minnesota Supreme Court denied Cliffs’ and the DNR’s petitions for review, thereby leaving in place the Court of Appeals’ reversal decision and remand back to the DNR.
The Trustees are unable to predict what impact, if any, the Minnesota Court of Appeals’ decision to reverse and remand the DNR order or the DNR’s future redetermination regarding whether the proposed project requires an EIS will have on mining, production and shipments of iron ore products from Northshore or future royalties payable to the Trust.
On June 16, 2025, WaterLegacy filed a civil complaint in the Second Judicial District, Ramsey County, Minnesota, Case No. 62-cv-25-4810, seeking injunctive and declaratory relief against the DNR and Northshore in relation to the proposed Milepost 7 tailings basin project. WaterLegacy seeks declaratory and injunctive relief under the Minnesota Environmental Policy Act (“MEPA”) and the Minnesota Environmental Rights Act (“MERA”). WaterLegacy specifically asks the court to (1) declare that any DNR approvals or Northshore construction activities related to the proposed project prior to completion of an EIS are prohibited under MEPA and (2) enjoin these approvals and activities until the EIS process is complete. WaterLegacy also asks the court to (1) declare that the proposed project’s dam enlargement violates or is likely to violate Minnesota dam permitting standards and rules and (2) enjoin the DNR and Northshore from proceeding with the proposed project until a new dam permit is issued in compliance with Minnesota statutes and rules.
On July 29, 2025, WaterLegacy filed a motion for a temporary injunction seeking to enjoin DNR from issuing any further approvals and Northshore from engaging in any construction or development activities related to the proposed project, including any activities to extend dams, relocate railroads, increase dam heights, expand the tailings basin footprint, or increase tailings deposition, pending resolution of the litigation or completion of environmental review. On September 4, 2025, the court issued an order denying the requested temporary injunction. The case is proceeding, and trial is set to occur in September 2027.
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The Trustees are unable to predict what impact, if any, the WaterLegacy lawsuit will have on mining, production and shipments of iron ore products from Northshore or future royalties payable to the Trust.
Forward-Looking Statements
This report contains certain forward-looking statements based on Cliffs’ publicly announced plans with respect to Northshore in the future, which statements are intended to be made under the safe harbor protections of the Private Securities Litigation Reform Act of 1995, as amended. Cliffs’ implementation of, or changes to, these plans are beyond Mesabi Trust’s control. As such, such statements are subject to risks and uncertainties, which could cause actual results to differ materially.
Although the Mesabi Trustees believe that any such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties, which could cause actual results to differ materially. Additional information concerning these and other risks and uncertainties is contained in Mesabi Trust’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended January 31, 2025 (filed April 24, 2025). Mesabi Trust undertakes no obligation to publicly update or revise any of the forward-looking statements made herein to reflect events or circumstances after the date hereof.
Important Factors Affecting Mesabi Trust
The Agreement of Trust specifically prohibits the Trustees from entering into or engaging in any business. This prohibition seemingly applies even to business activities the Trustees deem necessary or proper for the preservation and protection of the Trust’s assets. Accordingly, the Trustees’ activities in connection with the administration of Trust assets are limited to collecting income, paying expenses and liabilities, distributing net income to Mesabi Trust’s Unitholders after the payment of, or provision for, such expenses and liabilities, monitoring royalties and protecting and conserving the held assets.
Neither Mesabi Trust nor the Trustees have any control over the operations and activities of Northshore, except within the framework of the Royalty Agreement. Cliffs alone controls (i) historical operating data, including iron ore production volumes, decisions to reduce or idle the Northshore plant and mining operations, marketing of iron ore products, operating and capital expenditures as they relate to Northshore, environmental and other liabilities and the effects of regulatory changes; (ii) plans for Northshore’s future operating and capital expenditures; (iii) geological data relating to ore reserves; (iv) projected production of iron ore products; (v) contracts between Cliffs and Northshore with their customers; and (vi) the decision to mine off Mesabi Trust and/or state lands, based on Cliffs’ current mining and engineering plan. The Trustees do not exert any influence over mining operational decisions at Northshore, nor do the Trustees provide any input regarding the ore reserve estimated at Northshore as reported by Cliffs. While the Trustees request relevant information from Cliffs and Northshore in accordance with the Royalty Agreement for use in periodic reports as part of their evaluation of Mesabi Trust’s disclosure controls and procedures, the Trustees do not control this information and they rely on the information in Cliffs’ periodic and current filings with the SEC, as well as information from Northshore, to provide accurate and timely information in Mesabi Trust’s reports filed with the SEC.
In accordance with the Agreement of Trust, the Trustees are entitled to, and in fact do, rely upon certain experts in good faith, including (i) independent consultants with respect to monthly production and shipment reports, which include figures on crude ore production and iron ore pellet shipments, and discussions concerning the condition and accuracy of the scales and plans regarding the development of Mesabi Trust’s mining property; and (ii) the accounting firm they have contracted with for non-audit services, including reviews of financial data related to shipping and sales reports provided by Northshore and a review of the schedule of leasehold royalties payable to Mesabi Trust.
For a discussion of additional factors, including but not limited to those that could adversely affect Mesabi Trust’s actual results and performance, see “Risk Factors” set forth on pages 4 through 19 of Mesabi Trust’s Annual Report on Form 10-K for the fiscal year-ended January 31, 2025 (filed April 24, 2025).
Iron Ore Pricing and Contract Adjustments
Cliffs has recently disclosed that marketing and selling iron ore pellets to third party customers in arms-length transactions is no longer a core aspect of Northshore’s business. Historically, when Cliffs produced iron ore for arms’-length sales to third-party customers, some portion of the royalties Cliffs paid to Mesabi Trust were based in part on estimated prices for certain iron ore products sold under some of Cliffs’ customer contracts. Mesabi Trust is not a party to any of the Cliffs’ customer contracts. Generally, prices in some of such contracts were subject to interim and final pricing adjustments, which can be positive or negative, and which adjustments are dependent in part on a variety of price and inflation index factors, including but not limited to various benchmark pellet prices, hot band steel prices and various Producer Price Indexes. Although Northshore makes interim adjustments to the royalty payments on a quarterly basis, these price adjustments typically were not finalized until after the end of a contract year. In such circumstances, significant and frequent variations in royalties paid to the Trust could result. Iron ore products that are sold internally to Cliffs’ affiliates do not include such contract adjustment provisions.
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Potential distributions to Unitholders by the Trust can also vary significantly from quarter to quarter and on a comparative historical basis. These variations, which can be positive or negative, cannot be predicted by Mesabi Trust. It is possible that future negative price adjustments could partially or even completely offset royalties or royalty income that would otherwise be payable to the Trust in any particular quarter, or at year-end, thereby potentially reducing cash available for distribution to the Trust’s Unitholders in future quarters.
Effects of Securities Regulation
The Trust is a publicly traded, pass-through royalty trust with its Trust Certificates listed on the New York Stock Exchange (“NYSE”) and is therefore subject to extensive regulation under, among others, the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”), each as amended, and the rules and regulations of the NYSE. Issuers failing to comply with such authorities risk serious consequences, including criminal as well as civil and administrative penalties. In most instances, these laws, rules and regulations do not specifically address their applicability to a publicly-traded pass-through royalty trust such as Mesabi Trust. In particular, Sarbanes-Oxley mandated the adoption by the SEC and NYSE of certain rules and regulations that are impossible for the Trust to literally satisfy because of its nature as a pass-through royalty trust. Pursuant to NYSE rules, as a pass-through royalty trust, the Trust is exempt from many of the corporate governance requirements that apply to other publicly traded corporations. The Trust does not have, nor does the Agreement of Trust provide for, a board of directors, an audit committee, a corporate governance committee, a compensation committee or executive officers. The Trust has no employees. The Trustees closely monitor the SEC’s and NYSE’s rulemaking activities and will comply with their rules and regulations to the extent applicable.
The Trust’s website is located at www.mesabi-trust.com.
Critical Accounting Policies and Estimates
The Trust is a publicly traded, pass-through royalty trust with its Trust Certificates listed on the NYSE and is therefore subject to extensive regulation under, among others, the Securities Act of 1933, the Securities Exchange Act of 1934, Sarbanes-Oxley, each as amended, and the rules and regulations of the NYSE. Issuers failing to comply with such authorities risk serious consequences, including criminal as well as civil and administrative penalties. In most instances, these laws, rules and regulations do not specifically address their applicability to a publicly-traded pass-through royalty trust such as Mesabi Trust. In particular, Sarbanes-Oxley mandated the adoption by the SEC and NYSE of certain rules and regulations that are impossible for the Trust to literally satisfy because of its nature as a pass-through royalty trust. Pursuant to NYSE rules, as a pass-through royalty trust, the Trust is exempt from many of the corporate governance requirements that apply to other publicly traded corporations. The Trust does not have, nor does the Agreement of Trust provide for, a board of directors, an audit committee, a corporate governance committee, a compensation committee or executive officers. The Trust has no employees. The Trustees closely monitor the SEC’s and NYSE’s rulemaking activities and will comply with their rules and regulations to the extent applicable.
There have been no material changes in the Trust’s critical accounting policies or significant accounting estimates during the three months ended October 31, 2025. For a complete description of the Trust’s significant accounting policies, please see Note 2 to the financial statements included in the Trust’s Annual Report on Form 10-K for the year ended January 31, 2025 (filed April 24, 2025).
Certain Tax Information
The Trust is not taxable as a corporation for federal or state income tax purposes and is instead qualified as a nontaxable grantor trust. Since the Trust’s inception, all net taxable income is annually attributable directly to Unitholders for tax purposes regardless of whether the income is distributed or retained by the Trust in its reserve account. As such, in lieu of the Trust paying income taxes, Unitholders report their pro rata share of the various items of Trust income and deductions on their income tax returns. This reporting is required whether or not the earnings of the Trust are distributed as to Unitholders. During calendar year 2024, any funds retained to increase the Trust’s unallocated reserve, which were derived from reportable royalty income and other proceeds, will nonetheless become taxable as reportable income to Unitholders, depending on each individual’s personal tax situation. Information regarding the background on the changes in the Trust’s unallocated reserve is described above under “Results of Operations — Comparison of Unallocated Reserve as of October 31, 2025, October 31, 2024 and January 31, 2025” beginning on page 14. Unitholders are encouraged to consult with their own tax advisors to plan for any financial impact related to this and to review their personal tax situations related to investing in, holding or selling units of beneficial interest in Mesabi Trust.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
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Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures. The Trust maintains a system of disclosure controls and procedures designed to ensure that information required to be disclosed by the Trust in the reports that it furnishes or files under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the rules and regulations of the SEC. Due to the pass-through nature of the Trust, the Trust’s disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed by the Trust is received from Cliffs and its wholly-owned subsidiary, Northshore. In order to help ensure the accuracy and completeness of the information required to be disclosed in the Trust’s periodic and current reports, the Trust employs certified public accountants, geological consultants, and attorneys. These professionals hired by the Trust advise the Trust in its review and compilation of the information in this Form 10-Q and the other periodic reports filed by the Trust with the SEC.
As part of their evaluation of Mesabi Trust’s disclosure controls and procedures, the Trustees rely on quarterly shipment and royalty calculations provided by Northshore and Cliffs. Because Northshore has declined to provide a written certification attesting to whether Northshore has established disclosure controls and procedures and internal controls sufficient to enable it to verify that the information furnished to the Trustees is accurate and complete, the Trustees also rely on (a) an annual certification from Northshore and Cliffs, certifying as to the accuracy of the royalty calculations, and (b) the related due diligence review performed by the Trust’s accountants. In addition, Mesabi Trust’s consultants review the schedule of leasehold royalties payable, and shipping and sales reports provided by Northshore against production and shipment reports prepared by Eveleth Fee Office, Inc., an independent consultant to Mesabi Trust (“Eveleth Fee Office”). Eveleth Fee Office performs inspections of the Northshore mine and its pelletizing operations, observes production and shipping activities, gathers production and shipping information from Northshore and prepares monthly production and shipment reports for the Trustees. Furthermore, as part of its engagement by Mesabi Trust, Eveleth Fee Office also attends Northshore’s calibration and testing of its crude ore scales and boat loader scales which are conducted on a periodic basis.
As of the end of the period covered by this report, the Trustees carried out an evaluation of Mesabi Trust’s disclosure controls and procedures. Based on this evaluation, the Trustees have concluded that such disclosure controls and procedures are effective.
Changes in Internal Control over Financial Reporting. To the knowledge of the Trustees, there were no changes in the Trust’s internal control over financial reporting that occurred during the Trust’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Trust’s internal control over financial reporting. The Trustees note for purposes of clarification that they have no authority over, and make no statement concerning, the internal controls of Northshore or Cliffs.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
On September 26, 2025, Mesabi Trust initiated arbitration against Northshore and its parent, Cliffs (Northshore and Cliffs, jointly, the “Operator”), the lessee/operator of the leased lands. Mesabi Trust commenced the arbitration proceeding through the American Arbitration Association. Mesabi Trust seeks damages and declaratory relief relating to the Operator’s idling of Northshore’s operations from May 2022 to April 2023 and underpayment of royalties on intercompany shipments from 2023 through the present.
Item 1A. Risk Factors
The following Risk Factor supplements the Trust’s Risk Factors as described in “Risk Factors” as set forth in pages 4 to 19 of Mesabi Trust’s Annual Report on Form 10-K for the fiscal year ended January 31, 2025 (filed April 24, 2025).
Limited bona fide third-party sales transactions of iron ore products (processed at Northshore using Mesabi Trust iron ore) by Cliffs at prices below the annual bonus royalty threshold price could reduce or even eliminate bonus royalties historically paid to the Trust.
Since 2005, the Trust has consistently been paid bonus royalties by the mine operator pursuant to the Royalty Agreement. The Trust recognizes bonus royalties on a quarterly basis, based on the volume of shipments for each fiscal quarter at the actual royalty percentage for those shipments and based on the anticipated prices for iron ore products sold by Cliffs in bona-fide third-party transactions. The Trust is paid royalty bonuses when iron ore products shipped are sold at anticipated prices above a bonus threshold price per ton, which is calculated annually. The royalty bonus is based on a percentage of the gross proceeds of all iron ore product shipped that quarter. The royalty bonus percentage ranges from 1/2 of one percent of the gross proceeds (on all tons of iron ore shipped for sale at prices between the threshold price and $2.00 above the threshold price) to 3% of the gross proceeds (on all tonnage shipped for sale at prices $10 or more above the threshold price). The threshold price is adjusted annually for inflation and is $69.41 per ton for calendar year 2025. Although 98.3% of all the iron ore products shipped from Silver Bay during calendar 2024 were sold at prices higher than the 2024 adjusted threshold price, the Trustees are unable to project whether Cliffs will continue to sell iron ore products at prices above the applicable adjusted threshold price, entitling the Trust to any future bonus royalty payments. Limited third-party customer sale transactions of iron ore products produced with iron ore mined from Mesabi Lands at prices below the adjusted threshold price could lead to uncertainty under the Royalty Agreement regarding the calculation of bonus royalties, which in turn could result in potential disputes regarding the amount of bonus royalties owed to the Trust. Furthermore, such developments could potentially reduce or even eliminate bonus royalties payable to the Trust during a particular quarter or year.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
Item 5. Other Information
Mine Safety and Health Administration Safety Data. Pursuant to §1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, Cliffs started reporting information related to certain mine safety results at Northshore. This information is available in Part II, Item 4 of Cliffs’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, filed with the SEC on October 22, 2025.
Rule 10b5-1 Plan and Non-Rule 10b5-1 Trading Arrangement Adoptions, Terminations, and
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Item 6. Exhibits.
(a)Exhibits
The following exhibits are being filed or furnished with this Quarterly Report on Form 10-Q:
Exhibit No. |
| Exhibit |
| Filing Method |
| | | | |
31 | | | Filed herewith | |
| | | | |
32 | | | Furnished herewith | |
| | | | |
99.1 | | | Filed herewith | |
| | | | |
101 | | Inline XBRL Instance Document | | Filed herewith |
| | | | |
104 | | Cover Page Interactive Data File | | Embedded within the Inline XBRL document and contained in Exhibit 101 |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| MESABI TRUST | ||
| (Registrant) | ||
| | ||
| By: | DEUTSCHE BANK TRUST COMPANY AMERICAS | |
| | Corporate Trustee | |
| Principal Administrative Officer and duly authorized signatory:* | ||
| | | |
| | | |
| | | |
December 12, 2025 | | By: | /s/ Chris Niesz |
| | Name: Chris Niesz* | |
| | Title: Director | |
* There are no principal executive officers or principal financial officers of the registrant.
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Exhibit 31
CERTIFICATION
I, Chris Niesz, certify that:
1. | I have reviewed this Quarterly Report on Form 10-Q of Mesabi Trust, for which Deutsche Bank Trust Company Americas acts as Corporate Trustee; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, distributable income and changes in trust corpus of the registrant as of, and for, the periods presented in this report; |
4. | I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), or for causing such controls and procedures and internal control over financial reporting to be established and maintained, for the registrant and have: |
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, is made known to me by others within those entities, particularly during the period in which this report is being prepared;
b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors:
a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves persons who have a significant role in the registrant’s internal control over financial reporting.
In giving the foregoing certifications in paragraphs 4 and 5, I have relied to the extent I consider reasonable on information provided to me by Northshore Mining Company/Cleveland-Cliffs Inc. and Eveleth Fee Office, Inc.
Date: December 12, 2025 | By: | /s/ Chris Niesz |
| | Chris Niesz* |
| | Director |
| | Deutsche Bank Trust Company Americas |
| | Corporate Trustee |
* There are no principal executive officers or principal financial officers of the registrant.
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Exhibit 32
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, the Corporate Trustee of Mesabi Trust, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge, the Quarterly Report of Mesabi Trust on Form 10-Q for the quarter ended October 31, 2025 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Form 10-Q fairly presents in all material respects the financial condition and results of operations of Mesabi Trust.
/s/ Chris Niesz | | December 12, 2025 |
Chris Niesz* | | |
Director | | |
Deutsche Bank Trust Company Americas | | |
Corporate Trustee | | |
* There are no principal executive officers or principal financial officers of the registrant.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Unitholders and Trustees of Mesabi Trust:
Results of Review of Interim Financial Information
We have reviewed the condensed balance sheet of Mesabi Trust (the Trust) as of October 31, 2025, and the related condensed statements of income for the three-month and nine-month periods ended October 31, 2025 and 2024, and cash flows for the nine-month periods ended October 31, 2025 and 2024, and the related notes (collectively referred to as the interim financial statements). Based on our review, we are not aware of any material modifications that should be made to the Trust’s interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.
Basis for Review Results
These interim financial statements are the responsibility of the Trust’s Trustees. We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
/s/ Boulay PLLP
Minneapolis, Minnesota
December 12, 2025
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