MESABI TRUST

Current Developments

Receipt of Quarterly Royalty Report and Royalty Payment

On January 30, 2025, the Trustees of Mesabi Trust received the quarterly royalty report of iron ore production and shipments out of Silver Bay, Minnesota during the quarter ended December 31, 2024 (the “Royalty Report”) from Cliffs, the parent company of Northshore.

As reported by Cliffs to Mesabi Trust in the Royalty Report, based on shipments of iron ore products by Northshore during the three months ended December 31, 2024, Mesabi Trust was credited with a base royalty of $5,724,454. For the three months ended December 31, 2024, Mesabi Trust was also credited with a bonus royalty in the amount of $3,093,243. Cliffs reported that no adjustments were made in the fourth quarter 2024. In addition, a royalty payment of** $168,767 was paid to the Mesabi Land Trust. Accordingly, the total royalty payments received by Mesabi Trust on January 30, 2025 from Cliffs were **$8,986,464.

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 fourth calendar quarter of 2024, Cliffs credited Mesabi Trust with 1,110,800 tons of iron ore shipped or produced, as compared to 964,129 tons shipped or produced during the fourth calendar quarter of 2023.

The January 30, 2025 Royalty Report reported two additional low-volume sale transactions of iron ore pellets to a single third-party customer in December 2024. These two sale transactions are the only reported third-party pellet sales transactions since Cliffs’ July 30, 2024 quarterly royalty report when it reported two low-volume sales transactions to the same third-party customer in May and June 2024. The Trustees are continuing due diligence review of these transactions to evaluate whether such transactions meet the requirements of the Royalty Agreement. See “Risk Factors – Risks Related to Pass – Through Trust Structure of Mesabi Trust – The limited or lack of arms’-length third-party sales of iron ore pellets (processed at Northshore using Mesabi Trust’s iron ore) by Cliffs could lead to uncertainty under the Royalty Agreement with respect to the calculation of royalties, which could in turn result in potential disputes regarding the amount of royalties owed to the Trust,” as set forth on page 6 of Mesabi Trust’s Annual Report on Form 10-K for the fiscal year ended January 31, 2024 (filed April 24, 2024), page 19 of Mesabi Trust’s Quarterly Report on Form 10-Q for the fiscal quarter ended July 31, 2024 (filed September 5, 2024) and on page 6 of this Report.

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.

The Trustees of Mesabi Trust have received no specific updates concerning Cliffs’ plans with respect to Northshore iron ore operations. The last reported Cliffs’ public announcements made in April 2023 included that Northshore was then being partially restarted and would be run at less than full capacity for the remainder of 2023, and that Cliffs would continue to treat Northshore as a swing operation. With respect to calendar year 2025, Northshore has not advised Mesabi Trust of its expected shipments of iron ore products, or what percentage of 2025 shipments will be from Mesabi Trust iron ore.

Mesabi Trust Distribution Announcements

As previously announced by Mesabi Trust, on January 14, 2025 the Trustees of Mesabi Trust declared a distribution of five dollars ninety-five cents ($5.95) per Unit of Beneficial Interest payable on February 20, 2025 to Mesabi Trust Unitholders of record at the close of business on January 30, 2025. The distribution was paid as announced.

On April 15, 2025, the Trustees of Mesabi Trust announced the declaration of a distribution of fifty-six cents ($0.56) per Unit of Beneficial Interest payable on May 20, 2025 to Mesabi Trust Unitholders of record at the close of business on April 30, 2025.

AAA Arbitration Final Award and Payment

As previously reported, the arbitration initiated by the Trust in October 2022 concluded in June 2024. 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 Trust received the final award from the AAA tribunal on September 6, 2024, which unanimously awarded the Trust damages in the amount of $59,799,977 for underpaid royalties in 2020, 2021 and the first four months of 2022, plus pre-award interest in the amount of $11,288,269, calculated at the rate of 10% simple interest per annum from the date of the initial demand through September 6, 2024. Pursuant to the award, Cliffs and Northshore were required to pay the Trust the amounts specified in the Award by no later than October 6, 2024. The Tribunal approved the parties’ stipulated Consent Award approving the Trust’s ongoing entitlement to certain documentation related to verifying royalty calculations. The Tribunal denied the Trust’s request for declaratory relief regarding the time at which Cliffs’ and Northshore’s royalty obligations accrue.

Pursuant to the AAA tribunal’s final award dated September 6, 2024, Northshore and Cliffs paid Mesabi Trust $71,185,029 on October 4, 2024. This payment satisfied the AAA panel’s unanimous award of damages (including pre-award interest) for underpayment of royalties due to the Trust in 2020, 2021 and the first four months of 2022.

Mesabi filed a petition to confirm the award in New York County Supreme Court on January 16, 2025 (Court File No. 650311/2025). The court issued a decision and order confirming the award on March 7, 2025. A redacted copy of the confirmation of the final AAA Award can be found at Document No. 25 in the New York State Courts Electronic Filing System (New York County Supreme Court) at the following internet address: https://iapps.courts.state.ny.us/nyscef/CaseSearch. The information included on the website is not a part of, nor incorporated by reference into, this Annual Report on Form 10-K.

Northshore’s Proposed Project at Mile Post 7 Tailings Basin and Minnesota Litigation

Northshore operates Milepost 7 tailings basin located approximately five miles west of Silver Bay, Minnesota, and three miles from Lake Superior. Originally constructed in the late 1970’s, the Mile Post 7 tailings basin receives and impounds fine tailings that are a byproduct of processing taconite ore extracted from the Peter Mitchell Mine. The tailings basin now spans approximately 2,100 acres and is contained by three primary dams—Dams 1, 2, and 5.

In recent years, Northshore has proposed expanding the Milepost 7 tailings basin to accommodate increased production and extend the facility's operational lifespan. The proposed 650-acre expansion includes relocating an existing railroad embankment, extending Dams 1 and 2, constructing a rail switchback, and excavating clay from a borrow pit for dam construction. Additionally, the project involves stream mitigation efforts across several sites to address environmental impacts.

On March 1, 2024, the Minnesota DNR issued an order concluding that Northshore’s proposed Milepost 7 tailings basin project does not require an 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.

“It is important to note that the ruling does not require the DNR to prepare an Environmental Impact Statement (EIS) or a Supplemental EIS,” according to Erik Evans, a spokesperson for the DNR. “It requires us to take another look at our previous determination (i.e., that the project did not require an EIS) in light of the Court of Appeals' interpretation of Minnesota Environmental Policy Act (MEPA) regulations.”

The Trustees are unable to predict what impact, if any, the Minnesota Court of Appeals’ decision to reverse and remand the DNR order will have on production and shipments of iron ore products from Northshore or future royalties payable to the Trust.

On March 5, 2025, both the DNR and Northshore petitioned the Minnesota Supreme Court to review the Court of Appeals’ decision. The relator, WaterLegacy, opposed the petition and, on March 26, filed a motion to stay Northshore’s construction of the proposed project pending the resolution of the litigation. The DNR and Northshore both opposed the stay on substantive and procedural grounds. Northshore argued that any stay of its Milepost 7 tailings basin DNR Master Permit and five-year operating plan, “regardless of length, could require Northshore to cease operations at the Tailings Basin, which would necessitate the shutdown of Northshore’s iron ore pellet manufacturing operations entirely, and would result in significant economic harm to both Northshore and the local economy.” The Minnesota Supreme Court has not yet ruled on the petition for review or the motion to stay.

The Trustees are unable to predict what impact, if any, the Minnesota Supreme Court accepting or denying the petition for review or granting or denying WaterLegacy’s motion to stay will have on production and/or shipments of iron ore products from Northshore or on future royalties payable to the Trust.

Cliff's’ Recent Announcement to Idle One Mine and Partially Idle Another in Minnesota

On March 20, 2025, Cliffs announced that it is temporarily laying off 630 workers in Minnesota as it plans to idle its Minorca mine and partially idle its Hibbing Taconite mine on Minnesota’s Iron Range. Cliffs said it issued WARN notices related to the planned idle of these mines and that these temporary idlings are necessary to rebalance working capital needs and consume excess iron ore pellet inventory produced in 2024. Cliffs further disclosed that it remains committed to supporting its employees and communities while monitoring market conditions.

Cliffs’ Disclosure of Plans to Temporarily Idle Dearborn, Michigan Steel Plant

As reported by Bloomberg on March 25, 2025, a Cliffs representative said Cliffs will temporarily idle facilities at its Dearborn, Michigan steel plant and issue layoff notices to 600 employees amid weak US automotive demand. The Cliffs’ spokesperson also said Cliffs will idle the blast furnace, basic oxygen process steel shop and continuous casting facilities, and begin laying off employees in July 2025.

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 Amended Assignment of Peters Lease, and the framework of the Peters Lease (by virtue of Mesabi Land Trust’s interest in that Lease). 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 to provide accurate and timely information in Mesabi Trust’s reports filed with the SEC.

In accordance with the Agreement of Trust and the Amendment, the Trustees are entitled to, and in fact do, rely upon certain experts in good faith, including (i) the independent consultants they have contracted with, 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 this Mesabi Trust’s Annual Report on Form 10-K for the fiscal year-ended January 31, 2025.